SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended December 31, 1999
Commission File Number 1-3761
TEXAS INSTRUMENTS INCORPORATED
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(Exact name of Registrant as specified in its charter)
Delaware 75-0289970
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(State of Incorporation) (I.R.S. Employer Identification No.)
12500 TI Boulevard, P.O. Box 660199, Dallas, Texas 75266-0199
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 972-995-3773
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class which registered
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Common Stock, par value $1.00 New York Stock Exchange
The Swiss Exchange
Preferred Stock Purchase Rights New York Stock Exchange
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of the Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. X
The aggregate market value of voting stock held by non-affiliates of the
Registrant was approximately $85,473,000,000 as of January 31, 2000.
814,528,072
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(Number of shares of common stock outstanding as of January 31, 2000)
Parts I, II, III and IV hereof incorporate information by reference to the
Registrant's proxy statement for the 2000 annual meeting of stockholders.
PART I
ITEM 1. Business.
General Information
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Texas Instruments Incorporated ("TI" or the "company," including subsidiaries
except where the context indicates otherwise) is headquartered in Dallas,
Texas, and has manufacturing, design or sales operations in 27 countries.
TI's largest geographic markets are in the United States, Asia, Japan and
Europe. TI has been in operation since 1930.
The financial information with respect to TI's business segments and
operations outside the United States, which is contained in the note to the
financial statements captioned "Business Segment and Geographic Area Data" on
pages B-23 through B-25 of TI's proxy statement for the 2000 annual meeting of
stockholders, is incorporated herein by reference to such proxy statement.
Semiconductor
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TI is a global semiconductor company and the world's leading designer and
supplier of digital signal processors and analog integrated circuits, the
engines driving the digitization of electronics. These two types of
semiconductor products work together in digital electronic devices such as
digital cellular phones. Analog technology converts analog signals like
sound, light, temperature and pressure into the digital language of zeros and
ones, which can then be processed in real-time by a digital signal processor.
Analog integrated circuits also translate digital signals back to analog.
Digital signal processors and analog integrated circuits enable a wide range of
new products and features for TI's more than 30,000 customers in commercial,
industrial and consumer markets.
TI also is a world leader in the design and manufacturing of other
semiconductor products. Those products include standard logic, application-
specific integrated circuits, reduced instruction-set computing
microprocessors, microcontrollers and digital imaging devices.
The semiconductor business comprised 84% of TI's 1999 revenues. TI's
semiconductor products are used in a diverse range of electronic systems,
including digital cell phones, computers, printers, hard disk drives, modems,
networking equipment, digital cameras and video recorders, motor controls,
autos, and home appliances. Products are sold primarily to original-equipment
manufacturers and through distributors. TI's semiconductor patent portfolio
has been established as an ongoing contributor to semiconductor revenues.
Revenues generated from sales to TI's top four semiconductor customers
accounted for approximately 23% of total semiconductor revenues in 1999.
The semiconductor business is intensely competitive, subject to rapid
technological change and pricing pressures, and requires high rates of
investment. TI is the leading supplier of digital signal processors and
analog integrated circuits, yet faces strong competition in all of its
semiconductor
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product lines. The rapid pace of change and technological breakthroughs
constantly create new opportunities for existing competitors and start-ups,
which can quickly render existing technologies less valuable.
In digital signal processors, TI competes with a growing number of large and
small companies, both U.S.-based and international. New product development
capabilities, applications support, software knowledge and advanced technology
are the primary competitive factors in this business.
The market for analog integrated circuits is highly fragmented. TI competes
with many large and small companies, both U.S.-based and international.
Primary competitive factors in this business are the availability of innovative
designs and designers, a broad range of process technologies and applications
support and, particularly in the standard products area, price.
A Decline in the Market for Digital Signal Processors or Analog Integrated
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Circuits Could Have a Material Adverse Effect on TI's Results of Operations.
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TI has undertaken a strategy that focuses on developing and marketing digital
signal processors and analog integrated circuits. TI has divested certain of
its operations and acquired others and invested its resources with the view of
furthering its focus on these products. While TI believes that focusing its
efforts on digital signal processors and analog integrated circuits offers the
best opportunity for TI to achieve its strategic goals and that TI has
developed, and will continue to develop, a wide range of innovative and
technologically advanced products, the results of TI's operations may be
adversely affected in the future if the demand for digital signal processors
and analog integrated circuits decreases or this market grows at a pace
significantly less than that projected by management.
Other TI Businesses
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In addition to semiconductors, TI has two other principal segments. The
largest, representing 11% of TI's 1999 revenues, is Materials & Controls (M&C).
This business sells electrical and electronic controls, electronic connectors,
sensors, radio-frequency identification systems and clad metals into commercial
and industrial markets. Typically the top supplier in targeted product areas,
M&C faces strong multinational and regional competitors. The primary
competitive factors in this business are product reliability, manufacturing
costs and engineering expertise. The products of this business are sold
directly to original-equipment manufacturers and through distributors.
Revenues generated from sales to TI's top four M&C customers accounted for
approximately 16% of total M&C revenues in 1999.
Educational & Productivity Solutions (E&PS) represents 5% of TI's 1999
revenues and is a leading supplier of educational and graphing calculators.
This business sells primarily through retailers and to schools through
instructional dealers. TI's principal competitors in this business are Japan-
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and U.S.-based companies. Technology expertise, price and infrastructure for
education and market understanding are primary competitive factors in this
business. Revenues generated from sales to TI's top four E&PS customers
accounted for approximately 35% of total E&PS revenues in 1999.
Acquisitions and Divestitures
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From time to time TI considers acquisitions and divestitures that may
strengthen its business portfolio. TI may effect one or more of these
transactions at such time or times as it determines to be appropriate. In
1999, to support TI's focus on digital signal processors and analog integrated
circuits, it acquired technology companies that brought unique expertise in
key markets for these core product areas. In the first quarter, TI acquired
Butterfly VLSI, Ltd., a developer of chipsets for the short-distance wireless
market. In the second quarter, TI acquired Libit Signal Processing Ltd., a
developer of cable modem chipsets. In the third quarter, TI acquired ATL
Research A/S, a research and development company specializing in radio
frequency engineering, primarily for cellular phones; and Telogy Networks,
Inc., a developer of voice-over-Internet Protocol (VoIP) software. In the
fourth quarter, TI acquired two companies to support its analog catalog
portfolio: Unitrode Corporation, a designer and supplier of power supply
control, interface and battery management components, all rapidly growing
technologies necessary for portable devices, power systems and interface
applications; and Power Trends, Inc., a supplier of point-of-use power
solutions. The acquisition of Unitrode was accounted for as a pooling of
interests in 1999. All prior periods have been restated. The acquisitions
of Telogy and Power Trends were also accounted for as pooling of
interests in 1999; the historical operations of these entities were not
significant in relation to TI's consolidated operations on either an
individual or an aggregate basis; consequently, prior period financial
statements have not been restated for these acquisitions.
In addition, in the third quarter, TI's Materials & Controls business acquired
Integrated Sensor Solutions, Inc., a developer of high performance sensors
that are used in electrical control systems in the automotive market, and the
Educational & Productivity Solutions business acquired Soft Warehouse, Inc., a
maker of mathematical software for educational and professional use.
Backlog
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The dollar amount of backlog of orders believed by TI to be firm was $1827
million as of December 31, 1999 and $1265 million as of December 31, 1998.
Backlog orders are, under certain circumstances, subject to cancellation by
the purchaser without penalty. Also, there is generally a short cycle between
order and shipment. Accordingly, the company does not believe that its
backlog as of any particular date is necessarily indicative of actual revenues
for any future period.
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Raw Materials
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TI purchases materials, parts and supplies from a number of suppliers. The
materials, parts and supplies essential to TI's business are generally
available at present and TI believes at this time that such materials, parts
and supplies will be available in the foreseeable future.
Patents and Trademarks
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TI owns many patents in the United States and other countries in fields
relating to its business. The company has developed a strong, broad-based
patent portfolio. TI also has several agreements with other companies
involving license rights and anticipates that other licenses may be negotiated
in the future. TI does not consider its business materially dependent upon
any one patent or patent license, although taken as a whole, the rights of TI
and the products made and sold under patents and patent licenses are important
to TI's business.
TI owns trademarks that are used in the conduct of its business. These
trademarks are valuable assets, the most important of which are "Texas
Instruments," TI's corporate monogram and "TMS320."
Research and Development
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TI's research and development expense was $1333 million in 1999, compared with
$1225 million in 1998 and $1556 million in 1997. Included is a charge for the
value of acquisition-related purchased in-process research and development of
$79 million in 1999, $25 million in 1998, and $461 million in 1997.
Seasonality
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TI's revenues and operating results are subject to some seasonal variation.
Employees
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The information concerning the number of persons employed by TI at December 31,
1999 on page B-31 of TI's proxy statement for the 2000 annual meeting of
stockholders is incorporated herein by reference to such proxy statement.
Cautionary Statements Regarding Future Results of Operations
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You should read the following cautionary statements in conjunction with
discussions of factors discussed elsewhere in this and other of TI's filings
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with the Securities and Exchange Commission (SEC) and in materials
incorporated by reference in these filings. These cautionary statements are
intended to highlight certain factors that may affect the financial condition
and results of operations of TI and are not meant to be an exhaustive
discussion of risks that apply to companies with broad international
operations, such as TI. Like other businesses, TI is susceptible to
macroeconomic downturns in the United States or abroad that may affect the
general economic climate and performance of TI or its customers. Similarly,
the price of TI's securities is subject to volatility due to fluctuations in
general market conditions, differences in TI's results of operations from
estimates and projections generated by the investment community and other
factors beyond TI's control.
A Weakening in the Semiconductor Market May Adversely Affect TI's
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Performance.
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TI's semiconductor business represents its largest business segment and
the principal source of its revenues. The semiconductor market has
historically been cyclical and subject to significant economic downturns. A
significant weakening in the semiconductor market may adversely affect TI's
results of operations and have an adverse effect on the market price of its
securities.
The Technology Industry is Characterized by Rapid Technological Change
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that Requires TI to Develop New Technologies and Products.
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TI's results of operations depend in part upon its ability to successfully
develop and market innovative products in a rapidly changing technological
environment. TI requires significant capital to develop new technologies and
products to meet changing customer demands that, in turn, may result in
shortened product lifecycles. Moreover, expenditures for technology and
product development are generally made before the commercial viability for such
developments can be assured. As a result, there can be no assurance that TI
will successfully develop and market these new products, that the products TI
does develop and market will be well received by customers or that TI will
realize a return on the capital expended to develop such products.
TI's Faces Substantial Competition that Requires TI to Respond Rapidly to
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Product Development and Pricing Pressures.
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TI faces intense technological and pricing competition in the markets in
which it operates. TI expects that the level of this competition will increase
in the future from large, established semiconductor and related product
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companies, as well as from emerging companies serving niche markets also served
by TI. Certain of TI's competitors possess sufficient financial, technical and
management resources to develop and market products that may compete favorably
against those products of TI that currently offer technological and/or price
advantages over competitive products. Competition results in price and product
development pressures, which may result in reduced profit margins and lost
business opportunities in the event that TI is unable to match price declines
or technological, product, applications support, software or manufacturing
advances of its competitors.
TI's Performance Depends upon its Ability to Enforce Its Intellectual
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Property Rights and to Develop or License New Intellectual Property.
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TI benefits from royalties generated from various license agreements that
will be in effect through the year 2005. Future royalty revenues and access
to world-wide markets depend on the continued strength of TI's intellectual
property portfolio. TI actively enforces and protects its intellectual
property rights, but there can be no assurance that TI's efforts will be
adequate to prevent the misappropriation or improper use of the protected
technology. Moreover, there can be no assurance that, as TI's business expands
into new areas, TI will be able to independently develop the technology,
software or know-how necessary to conduct its business. TI may have to rely
increasingly on licensed technology from others. To the extent that TI relies
on licenses from others, there can be no assurance that it will be able to
obtain all of the licenses it desires in the future on terms it considers
reasonable or at all.
A Decline in Demand in Certain End-User Markets Could Have a Material
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Adverse Effect on the Demand for TI's Products and Results of Operations.
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TI's customer base includes companies in a wide range of industries, but
TI generates a significant amount of revenues from sales to customers in the
telecommunications and computer-related industries. Within these industries,
a large portion of TI revenues is generated by the sale of digital signal
processors and analog integrated circuits to customers in the cellular phone,
modem and hard disk drive segments of these industries. A significant decline
in any one or several of these end-user markets could have a material adverse
effect on the demand for TI's products and its results of operations.
There Can Be No Assurance of the Accuracy of the Assessment of Year 2000
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Issues.
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In anticipation of potential Year 2000 issues that result from the use of
two digit, rather than four digit, year dates in software, TI implemented a
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company-wide program to assess its Year 2000 readiness and, where appropriate,
to implement corrective actions. TI does not anticipate any material
disruption in our operations as the result of any Year 2000 issues. However,
there can be no assurance that TI has fully and accurately assessed its Year
2000 readiness or of the effectiveness of TI's corrective actions. Nor can
there be any assurance that TI's customers and suppliers fully and accurately
assessed their Year 2000 readiness or of the effectiveness of their corrective
actions.
TI's International Manufacturing Operations and Sales Subject It to Risks
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Associated with Legal, Political, Economic or Other Changes Outside of the
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United States.
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TI operates in 27 countries worldwide and in 1999 derived in excess of 67%
of its revenues from sales to locations outside the United States. Operating
internationally exposes TI to changes in the laws or policies, as well as the
general economic conditions, of the various countries in which it operates,
which could result in an adverse effect on TI's business operations in such
countries and its results of operations. Also, as discussed in more detail on
pages B-11, B-35 and B-36 of TI's proxy statement for the 2000 annual meeting
of stockholders, TI uses forward currency exchange contracts to minimize the
adverse earnings impact from the effect of exchange rate fluctuations on the
company's non-U.S. dollar net balance sheet exposures. Nevertheless, in
periods when the U.S. dollar strengthens in relation to the non-U.S.
currencies in which TI transacts business, the remeasurement of non-U.S.
dollar transactions can have an adverse effect on TI's non-U.S. business.
The Loss of or Significant Curtailment of Purchases by any of TI's Largest
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Customers Could Adversely Affect TI's Results of Operations.
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While TI generates revenues from thousands of customers worldwide, the
loss of or significant curtailment of purchases by one or more of its top
customers, including curtailments due to a change in the sourcing policies or
practices of these customers, may adversely affect TI's results of operations.
TI's Continued Success Depends Upon Its Ability to Retain and Recruit a
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Sufficient Number of Qualified Employees in a Competitive Environment.
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TI's continued success depends on the retention and recruitment of
skilled personnel, including technical, marketing, management and staff
personnel. Experienced personnel in the electronics industry are in high
demand and competition for their skills is intense. There can be no
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assurance that TI will be able to successfully retain and recruit the key
personnel that it requires.
Available Information
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TI files annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any reports, statements and
other information filed by TI at the SEC's public reference rooms at 450 Fifth
Street, N.W., Washington, D.C. 20549, or at the SEC offices in New York, New
York and Chicago, Illinois. Please call (800) SEC-0330 for further
information on the public reference rooms. TI's filings are also available to
the public from commercial document retrieval services and at the web site
maintained by the SEC at http://www.sec.gov.
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ITEM 2. Properties.
TI's principal executive offices are located at 12500 TI Boulevard, Dallas,
Texas. TI owns and leases facilities in the United States and 12 other
countries for manufacturing, design and related purposes. The following table
indicates the general location of TI's principal manufacturing and design
operations and the business segments which make major use of them. Except as
otherwise indicated, these facilities are owned by TI.
Materials
Semiconductor & Controls E&PS
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Dallas, Texas(1) X X X
Houston, Texas X
Sherman, Texas(1)(2) X
Santa Cruz, California X
Attleboro, X X
Massachusetts
Hiji, Japan X
Miho, Japan X
Kuala Lumpur, X X
Malaysia(3)
Baguio, X
Philippines(4)
Taipei, Taiwan X
Nice, France X
Freising, Germany X X
Aguascalientes, Mexico X X
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(1) Certain facilities or portions thereof in Dallas and Sherman are leased
to Raytheon Company or Raytheon-related entities in connection with the sale
in 1997 of TI's defense systems and electronics business.
(2) Leased.
(3) Approximately half of this site is owned on leased land; the remainder is
leased.
(4) Owned on leased land.
TI's facilities in the United States contained approximately 17,100,000 square
feet as of December 31, 1999, of which approximately 3,300,000 square feet
were leased. TI's facilities outside the United States contained approximately
5,200,000 square feet as of December 31, 1999, of which approximately 1,400,000
square feet were leased.
TI believes that its existing properties are in good condition and suitable
for the manufacture of its products. At the end of 1999, the company utilized
substantially all of the space in its facilities.
Leases covering TI's leased facilities expire at varying dates generally
within the next 10 years. TI anticipates no difficulty in either retaining
occupancy through lease renewals, month-to-month occupancy or purchases of
leased facilities, or replacing the leased facilities with equivalent
facilities.
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ITEM 3. Legal Proceedings.
Approximately $300 million of grants from the Italian government to TI's former
memory operations in Italy are being reviewed in the ordinary course by
government auditors. TI understands that these auditors are questioning
whether some of the grants were applied to purposes outside the scope of the
grants. TI's deferred gain on the sale of its memory business may be reduced
to the extent that any grants are determined to have been misapplied. Also, TI
understands that an Italian prosecutor is conducting a criminal investigation
concerning a portion of the grants relating to specified research and
development activities. The company believes that the grants were obtained and
used in compliance with applicable law and contractual obligations.
TI is involved in various investigations and proceedings conducted by the
federal Environmental Protection Agency and certain state environmental
agencies regarding disposal of waste materials. Although the factual
situations and the progress of each of these matters differ, the company
believes that the amount of its liability will not have a material adverse
effect upon its financial position or results of operations and, in most cases,
TI's liability will be limited to sharing clean-up or other remedial costs with
other potentially responsible parties.
ITEM 4. Submission of Matters to a Vote of Security Holders.
Not applicable.
PART II
ITEM 5. Market for Registrant's Common Equity and Related Stockholder
Matters.
The information which is contained in the note to the financial statements
captioned "Common Stock Prices and Dividends" on page B-43 of TI's proxy
statement for the 2000 annual meeting of stockholders, and the information
concerning the number of stockholders of record at December 31, 1999 on page
B-31 of such proxy statement, are incorporated herein by reference to such
proxy statement.
ITEM 6. Selected Financial Data.
The "Summary of Selected Financial Data" for the years 1995 through 1999 which
appears on page B-31 of TI's proxy statement for the 2000 annual meeting of
stockholders is incorporated herein by reference to such proxy statement.
ITEM 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
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The information contained under the caption "Management Discussion and Analysis
of Financial Condition and Results of Operations" on pages B-32 through B-41 of
TI's proxy statement for the 2000 annual meeting of stockholders is
incorporated herein by reference to such proxy statement.
ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk
Information concerning market risk is contained on pages B-35 and B-36 of TI's
proxy statement for the 2000 annual meeting of stockholders and is incorporated
by reference to such proxy statement.
ITEM 8. Financial Statements and Supplementary Data.
The consolidated financial statements of the company at December 31, 1999 and
1998 and for each of the three years in the period ended December 31, 1999, and
the report thereon of the independent auditors, on pages B-1 through B-30 of
TI's proxy statement for the 2000 annual meeting of stockholders, are
incorporated herein by reference to such proxy statement.
The "Quarterly Financial Data" on page B-42 of TI's proxy statement
for the 2000 annual meeting of stockholders is also incorporated herein by
reference to such proxy statement.
ITEM 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
Not applicable.
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PART III
ITEM 10. Directors and Executive Officers of the Registrant.
The information with respect to directors' names, ages, positions, term of
office and periods of service, which is contained under the caption "Nominees
for Directorship" in the company's proxy statement for the 2000 annual meeting
of stockholders, is incorporated herein by reference to such proxy statement.
The following is an alphabetical list of the names and ages of the executive
officers of the company and the positions or offices with the company presently
held by each person named:
Name Age Position
Richard J. Agnich 56 Senior Vice President and Secretary
William A. Aylesworth 57 Senior Vice President,
Treasurer and Chief Financial
Officer
Thomas J. Engibous 47 Director; Chairman of the
Board, President and Chief Executive
Officer
Joseph F. Hubach 42 Senior Vice President and General
Counsel
Stephen H. Leven 48 Senior Vice President
Keh-Shew Lu 53 Senior Vice President
John Scarisbrick 47 Senior Vice President
Richard Schaar 54 Senior Vice President
(President, Educational &
Productivity Solutions)
M. Samuel Self 60 Senior Vice President and Controller
(Chief Accounting Officer)
Elwin L. Skiles, Jr. 58 Senior Vice President
Richard K. Templeton 41 Executive Vice President
(President, Semiconductor)
Teresa L. West 39 Senior Vice President
Delbert A. Whitaker 56 Senior Vice President
Thomas Wroe 49 Senior Vice President
(President, Materials & Controls)
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The term of office of the above listed officers is from the date of their
election until their successor shall have been elected and qualified. Mr.
Hubach was elected to his respective office on January 20, 2000; the most
recent date of election of the other officers was April 22, 1999. Messrs.
Agnich, Aylesworth, Engibous and Skiles have served as officers of the company
for more than five years. Mr. Templeton has served as an officer of the
company since 1996, and he has been an employee of the company for more than
five years. Ms. West and Messrs. Hubach, Leven, Lu, Scarisbrick, Schaar,
Self, Whitaker and Wroe have served as officers of the company since March 19,
1998 and have been employees of the company for more than five years.
ITEM 11. Executive Compensation.
The information which is contained under the captions "Directors Compensation"
and "Executive Compensation" in the company's proxy statement for the 2000
annual meeting of stockholders is incorporated herein by reference to such
proxy statement.
ITEM 12. Security Ownership of Certain Beneficial Owners and Management.
The information concerning (a) the only persons that have reported beneficial
ownership of more than 5% of the common stock of TI, and (b) the ownership of
TI's common stock by the Chief Executive Officer and the four other most
highly compensated executive officers, and all executive officers and
directors as a group, which is contained under the caption "Voting Securities"
in the company's proxy statement for the 2000 annual meeting of stockholders,
is incorporated herein by reference to such proxy statement. The information
concerning ownership of TI's common stock by each of the directors, which is
contained under the caption "Nominees for Directorship" in such proxy
statement, is also incorporated herein by reference to such proxy statement.
ITEM 13. Certain Relationships and Related Transactions.
Not applicable.
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PART IV
ITEM 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.
(a) 1 and 2. Financial Statements and Financial Statement
Schedules:
The financial statements and financial statement schedules are
listed in the index on page 23 hereof.
3. Exhibits:
Designation of
Exhibit in
this Report Description of Exhibit
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3(a) Restated Certificate of Incorporation of the
Registrant (incorporated by reference to Exhibit
3(a) to the Registrant's Annual Report on Form
10-K for the year 1993).
3(b) Certificate of Amendment to Restated Certificate
of Incorporation of the Registrant (incorporated
by reference to Exhibit 3(b) to the Registrant's
Annual Report on Form 10-K for the year 1993).
3(c) Certificate of Amendment to Restated Certificate
of Incorporation of the Registrant (incorporated
by reference to Exhibit 3(c) to the Registrant's
Annual Report on Form 10-K for the year 1993).
3(d) Certificate of Amendment to Restated Certificate
of Incorporation of the Registrant (incorporated
by reference to Exhibit 3 to the Registrant's
Quarterly Report on Form 10-Q for the quarter
ended June 30, 1996).
3(e) Certificate of Ownership Merging Texas
Instruments Automation Controls, Inc. into the
Registrant (incorporated by reference to Exhibit
3(e) to the Registrant's Annual Report on Form
10-K for the year 1993).
3(f) Certificate of Elimination of Designations of
Preferred Stock of the Registrant (incorporated
by reference to Exhibit 3(f) to the Registrant's
Annual Report on Form 10-K for the year 1993).
3(g) Certificate of Ownership and Merger Merging
Tiburon Systems, Inc. into the Registrant
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(incorporated by reference to Exhibit 4(g) to the
Registrant's Registration Statement No.
333-41919 on Form S-8).
3(h) Certificate of Ownership and Merger Merging
Tartan, Inc. into the Registrant (incorporated by
reference to Exhibit 4(h) to the Registrant's
Registration Statement No. 333-41919 on Form
S-8).
3(i) Certificate of Designation relating to the
Registrant's Participating Cumulative Preferred
Stock (incorporated by reference to Exhibit 4(a)
to the Registrant's Quarterly Report on Form 10-Q
for the quarter ended September 30, 1998).
3(j) Certificate of Elimination of Designation of
Preferred Stock of the Registrant (incorporated by
reference to Exhibit 3(j) to the Registrant's
Annual Report on Form 10-K for the year 1998).
3(k) Certificate of Ownership and Merger Merging
Intersect Technologies, Inc. into the Registrant.
3(l) Certificate of Ownership and Merger Merging
Soft Warehouse, Inc. into the Registrant.
3(m) Certificate of Ownership and Merger Merging
Silicon Systems, Inc. into the Registrant.
3(n) By-Laws of the Registrant.
4(a)(i) Rights Agreement dated as of June 18, 1998
between the Registrant and Harris Trust and
Savings Bank as Rights Agent, which includes as
Exhibit B the form of Rights Certificate
(incorporated by reference to Exhibit 1 to the
Registrant's Registration Statement on Form 8-A
dated June 23, 1998).
4(a)(ii) Amendment dated as of September 18, 1998 to the
Rights Agreement (incorporated by reference to
Exhibit 2 to the Registrant's Amendment No. 1 to
Registration Statement on Form 8-A dated September
23, 1998).
4(b) The Registrant agrees to provide the Commission,
upon request, copies of instruments defining the
rights of holders of long-term debt of the
Registrant and its subsidiaries.
10(a)(i) Amended and Restated TI Deferred Compensation
Plan.*
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10(a)(ii) First Amendment to Restated TI Deferred
Compensation Plan.*
10(a)(iii) Second Amendment to Restated TI Deferred Compensation Plan.*
10(b)(i) TI Employees Supplemental Pension Plan.*
10(b)(ii) First Amendment to TI Supplemental Pension Plan.*
10(c) Texas Instruments Long-Term Incentive Plan
(incorporated by reference to Exhibit 10(a)(ii)
to the Registrant's Annual Report on Form 10-K
for the year 1993).*
10(d) Texas Instruments 1996 Long-Term Incentive Plan
(incorporated by reference to Exhibit 10 to the
Registrant's Quarterly Report on Form 10-Q for
the quarter ended June 30, 1996).*
10(e) Texas Instruments Executive Officer Performance
Plan (incorporated by reference to the
Registrant's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1997).*
10(f) Texas Instruments Restricted Stock Unit Plan for
Directors (incorporated by reference to
Exhibit 10(e) to the Registrant's Quarterly
Report on Form 10-Q for the quarter ended
March 31, 1998).
10(g) Texas Instruments Directors Deferred Compensation
Plan (incorporated by reference to Exhibit 10(f)
to the Registrant's Quarterly Report on Form 10-Q
for the quarter ended March 31, 1998).
10(h) Texas Instruments Stock Option Plan for
Non-Employee Directors (incorporated by reference
to Exhibit 10(g) to the Registrant's Annual Report
on Form 10-K for the year 1998).
10(i) Asset Purchase Agreement dated as of January 4,
1997 between the Registrant and Raytheon Company
(exhibits and schedules omitted) (incorporated by
reference to Exhibit 2.1 to the Registrant's
Current Report on Form 8-K dated January 4,
1997).
10(j) Acquisition Agreement dated as of June 18, 1998
between Texas Instruments Incorporated and Micron
Technology, Inc. (exhibit C omitted) (incorporated
by reference to Exhibit 2.1 to the Registrant's
Current Report on Form 8-K dated June 18, 1998).
10(k) Second Amendment to Acquisition Agreement dated as
of September 30, 1998 between Texas Instruments
-17-
Incorporated and Micron Technology, Inc.
(incorporated by reference to Exhibit 2.2 to the
Registrant's Current Report on Form 8-K dated
October 15, 1998).
10(l) Securities Rights and Restrictions Agreement dated
as of September 30, 1998 between Texas Instruments
Incorporated and Micron Technology, Inc.
(incorporated by reference to Exhibit 10(k) to the
Registrant's Annual Report on Form 10-K for the
year 1998).
11 Computation of Earnings Per Common and Dilutive
Potential Common Share.
12 Computation of Ratio of Earnings to Fixed Charges.
13 Portions of Registrant's Proxy Statement for the
2000 Annual Meeting of Stockholders Incorporated
by Reference Herein (incorporated by reference to
Exhibit B to the Registrant's Proxy Statement for
the 2000 Annual Meeting of Stockholders).
21 List of Subsidiaries of the Registrant.
23 Consent of Ernst & Young LLP.
27 Financial Data Schedule as of December 31,
1999 and for the year then ended.
27.1 Restated Financial Data Schedule as of
December 31, 1998 and for the year then ended.
27.2 Restated Financial Data Schedule as of
December 31, 1997 and for the year then ended.
- ----------------
*Executive Compensation Plans and Arrangements:
Amended and Restated TI Deferred Compensation Plan.
First Amendment to Restated TI Deferred Compensation Plan.
Second Amendment to Restated TI Deferred Compensation Plan.
TI Employees Supplemental Pension Plan.
First Amendment to TI Supplemental Pension Plan.
Texas Instruments Long-Term Incentive Plan (incorporated by
reference to Exhibit 10(a)(ii) to the Registrant's Annual Report on
Form 10-K for the year 1993).
Texas Instruments 1996 Long-Term Incentive Plan (incorporated by
reference to Exhibit 10 to the Registrant's Quarterly Report on Form
-18-
10-Q for the quarter ended June 30, 1996).
Texas Instruments Executive Officer Performance Plan (incorporated
by reference to the Registrant's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1997).
(b) Reports on Form 8-K:
The Registrant filed the following reports on Form 8-K with the SEC during the
quarter ended December 31, 1999: Form 8-K dated October 15, 1999, relating to
completion of the acquisition by the Registrant of Unitrode Corporation; and
Form 8-K dated December 6, 1999, relating to extension of an exchange offer
for debt securities of the Registrant.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
1995:
This report includes "forward-looking statements" intended to qualify for the
safe harbor from liability established by the Private Securities Litigation
Reform Act of 1995. These forward-looking statements generally can be
identified by phrases such as TI or its management "believes," "expects,"
"anticipates," "foresees," "forecasts," "estimates" or other words or phrases
of similar import. Similarly, statements herein that describe TI's business
strategy, outlook, objectives, plans, intentions or goals also are forward-
looking statements. All such forward-looking statements are subject to certain
risks and uncertainties that could cause actual results to differ materially
from those in forward-looking statements.
We urge you to carefully consider the following important factors that could
cause actual results to differ materially from the expectations of TI or its
management:
- - Market demand for semiconductors, particularly for digital signal
processors and analog integrated circuits in key markets, such as
telecommunications and computers.
- - TI's ability to develop, manufacture and market innovative products in a
rapidly changing technological environment.
- - TI's ability to compete in products and prices in an intensely competitive
industry.
- - TI's ability to maintain and enforce a strong intellectual property
portfolio and obtain needed licenses from third parties.
- - Accurate assessment of Year 2000 by TI, its customers and its suppliers.
- - Global economic, social and political conditions in the countries in which
TI and its customers and suppliers operate, including fluctuations in
foreign currency exchange rates.
- - Losses or curtailments of purchases from key customers or the timing of
customer inventory corrections.
-19-
- - TI's ability to recruit and retain skilled personnel.
- - Availability of raw materials and critical manufacturing equipment.
For a more detailed discussion of these factors see the text under the heading
"Cautionary Statements Regarding Future Results of Operations" in Item 1 of
this report. The forward-looking statements included in this report are made
only as of the date of this report and TI undertakes no obligation to publicly
update the forward-looking statements to reflect subsequent events or
circumstances.
-20-
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this Report to be signed on its
behalf by the undersigned, thereunto duly authorized.
TEXAS INSTRUMENTS INCORPORATED
By: /s/ WILLIAM A. AYLESWORTH
------------------------------
William A. Aylesworth
Senior Vice President,
Treasurer and Chief
Financial Officer
Date: February 18, 2000
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed below by the following persons on behalf of the
Registrant and in the capacities indicated on the 17th day of February, 2000.
Signature Title
/s/ JAMES R. ADAMS Director
- ------------------------------------
James R. Adams
/s/ DAVID L. BOREN Director
- ------------------------------------
David L. Boren
/s/ JAMES B. BUSEY IV Director
- ------------------------------------
James B. Busey IV
/s/ DANIEL A. CARP Director
- ------------------------------------
Daniel A. Carp
/s/ THOMAS J.ENGIBOUS Chairman of the Board; President;
- ------------------------------------ Chief Executive Officer; Director
Thomas J. Engibous
/s/ GERALD W. FRONTERHOUSE Director
- ------------------------------------
Gerald W. Fronterhouse
/s/ DAVID R. GOODE Director
- ------------------------------------
David R. Goode
-21-
/s/ WAYNE R. SANDERS Director
- ------------------------------------
Wayne R. Sanders
/s/ RUTH J. SIMMONS Director
- ------------------------------------
Ruth J. Simmons
/s/ CLAYTON K. YEUTTER Director
- ------------------------------------
Clayton K. Yeutter
/s/ WILLIAM A. AYLESWORTH Senior Vice President; Treasurer;
- ------------------------------------ Chief Financial Officer
William A. Aylesworth
/s/ M. SAMUEL SELF
- ------------------------------------ Senior Vice President; Controller;
M. Samuel Self Chief Accounting Officer
-22-
TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES
INDEX TO FINANCIAL STATEMENTS
AND FINANCIAL STATEMENT SCHEDULES
(Item 14(a))
Page Reference
--------------
Proxy Statement
for the 2000
Annual Meeting
Form 10-K of Stockholders
--------- ---------------
Information incorporated by reference
to the Registrant's Proxy Statement for
the 2000 Annual Meeting of Stockholders
Consolidated Financial Statements:
Income for each of the three
years in the period ended
December 31, 1999 B-1
Balance sheet at December 31,
1999 and 1998 B-2
Cash flows for each of the
three years in the period
ended December 31, 1999 B-3
Stockholders' equity for each of
the three years in the period
ended December 31, 1999 B-4
Notes to financial statements B-5 - B-29
Report of Independent Auditors B-30
Consolidated Schedule for each of the three
years in the period ended December 31, 1999:
II. Allowance for Losses 24
All other schedules have been omitted since the required information is
not present or not present in amounts sufficient to require submission of the
schedule, or because the information required is included in the consolidated
financial statements or the notes thereto.
-23-
Schedule II
---------
<TABLE>
<CAPTION>
TEXAS INSTRUMENTS AND SUBSIDIARIES
ALLOWANCE FOR LOSSES
(IN MILLIONS OF DOLLARS)
Years Ended December 31, 1999, 1998, 1997
Balance at Balance
Beginning Charged to at End
Description of Year Expenses Deductions of Year
Allowance for losses:
<S> <C> <C> <C> <C>
1999 $72 $ 82 $ (87) $67
1998 $75 $ 74 $ (77) $72
1997 $91 $134 $(150) $62
Allowance for losses from uncollectible accounts, returns, etc., are deducted from accounts
receivable in the balance sheet.
</TABLE>
-24-
Exhibit Index
Designation of
Exhibit in Electronic
this Report Description of Exhibit or Paper
- -------------- ---------------------- ----------
3(a) Restated Certificate of Incorporation of the E
Registrant (incorporated by reference to Exhibit
3(a) to the Registrant's Annual Report on Form
10-K for the year 1993).
3(b) Certificate of Amendment to Restated Certificate E
of Incorporation of the Registrant (incorporated
by reference to Exhibit 3(b) to the Registrant's
Annual Report on Form 10-K for the year 1993).
3(c) Certificate of Amendment to Restated Certificate E
of Incorporation of the Registrant (incorporated
by reference to Exhibit 3(c) to the Registrant's
Annual Report on Form 10-K for the year 1993).
3(d) Certificate of Amendment to Restated Certificate E
of Incorporation of the Registrant (incorporated
by reference to Exhibit 3 to the Registrant's
Quarterly Report on Form 10-Q for the quarter
ended June 30, 1996).
3(e) Certificate of Ownership Merging Texas E
Instruments Automation Controls, Inc. into the
Registrant (incorporated by reference to Exhibit
3(e) to the Registrant's Annual Report on Form
10-K for the year 1993).
3(f) Certificate of Elimination of Designations of E
3(g) Certificate of Ownership and Merger Merging E
Tiburon Systems, Inc. into the Registrant
(incorporated by reference to Exhibit 4(g) to the
Registrant's Registration Statement No.
333-41919 on Form S-8).
3(h) Certificate of Ownership and Merger Merging E
Tartan, Inc. into the Registrant (incorporated by
reference to Exhibit 4(h) to the Registrant's
Registration Statement No. 333-41919 on Form
S-8).
3(i) Certificate of Designation relating to the E
Registrant's Participating Cumulative Preferred
Stock (incorporated by reference to Exhibit 4(a)
to the Registrant's Quarterly Report on Form 10-Q
for the quarter ended September 30, 1998).
3(j) Certificate of Elimination of Designation of E
Preferred Stock of the Registrant (incorporated by
reference to Exhibit 3(j) to the Registrant's
Annual Report on Form 10-K for the year 1998).
3(k) Certificate of Ownership and Merger Merging E
Intersect Technologies, Inc. into the Registrant.
3(l) Certificate of Ownership and Merger Merging E
Soft Warehouse, Inc. into the Registrant.
3(m) Certificate of Ownership and Merger Merging E
Silicon Systems, Inc. into the Registrant.
3(n) By-Laws of the Registrant. E
4(a)(i) Rights Agreement dated as of June 18, 1998 E
between the Registrant and Harris Trust and
Savings Bank as Rights Agent, which includes as
Exhibit B the form of Rights Certificate
(incorporated by reference to Exhibit 1 to the
Registrant's Registration Statement on Form 8-A
dated June 23, 1998).
4(a)(ii) Amendment dated as of September 18, 1998 to the E
Rights Agreement (incorporated by reference to
Exhibit 2 to the Registrant's Amendment No. 1 to
Registration Statement on Form 8-A dated September
23, 1998).
4(b) The Registrant agrees to provide the Commission,
upon request, copies of instruments defining the
rights of holders of long-term debt of the
Registrant and its subsidiaries.
10(a)(i) Amended and Restated TI Deferred Compensation E
Plan.*
10(a)(ii) First Amendment to Restated TI Deferred E
Compensation Plan.*
10(a)(iii) Second Amendment to Restated TI Deferred E
Compensation Plan.*
10(b)(i) TI Employees Supplemental Pension Plan.* E
10(b)(ii) First Amendment to TI Supplemental Pension Plan.* E
10(c) Texas Instruments Long-Term Incentive Plan E
(incorporated by reference to Exhibit 10(a)(ii)
to the Registrant's Annual Report on Form 10-K
for the year 1993).*
10(d) Texas Instruments 1996 Long-Term Incentive Plan E
(incorporated by reference to Exhibit 10 to the
Registrant's Quarterly Report on Form 10-Q for
the quarter ended June 30, 1996).*
10(e) Texas Instruments Executive Officer Performance E
Plan (incorporated by reference to the
Registrant's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1997).*
10(f) Texas Instruments Restricted Stock Unit Plan for E
Directors (incorporated by reference to
Exhibit 10(e) to the Registrant's Quarterly
Report on Form 10-Q for the quarter ended
March 31, 1998).
10(g) Texas Instruments Directors Deferred Compensation E
Plan (incorporated by reference to Exhibit 10(f)
to the Registrant's Quarterly Report on Form 10-Q
for the quarter ended March 31, 1998).
10(h) Texas Instruments Stock Option Plan for E
Non-Employee Directors (incorporated by reference
to Exhibit 10(g) to the Registrant's Annual Report
on Form 10-K for the year 1998).
10(i) Asset Purchase Agreement dated as of January 4, E
1997 between the Registrant and Raytheon Company
(exhibits and schedules omitted) (incorporated by
reference to Exhibit 2.1 to the Registrant's
Current Report on Form 8-K dated January 4,
1997).
10(j) Acquisition Agreement dated as of June 18, 1998 E
between Texas Instruments Incorporated and Micron
Technology, Inc. (exhibit C omitted) (incorporated
by reference to Exhibit 2.1 to the Registrant's
Current Report on Form 8-K dated June 18, 1998).
10(k) Second Amendment to Acquisition Agreement dated as E
of September 30, 1998 between Texas Instruments
Incorporated and Micron Technology, Inc.
(incorporated by reference to Exhibit 2.2 to the
Registrant's Current Report on Form 8-K dated
October 15, 1998).
10(l) Securities Rights and Restrictions Agreement dated E
as of September 30, 1998 between Texas Instruments
Incorporated and Micron Technology, Inc.
(incorporated by reference to Exhibit 10(k) to the
Registrant's Annual Report on Form 10-K for the
year 1998).
11 Computation of Earnings Per Common and Dilutive E
Potential Common Share.
12 Computation of Ratio of Earnings to Fixed Charges. E
13 Portions of Registrant's Proxy Statement for the E
2000 Annual Meeting of Stockholders Incorporated
by Reference Herein (incorporated by reference to
Exhibit B to the Registrant's Proxy Statement for
the 2000 Annual Meeting of Stockholders).
21 List of Subsidiaries of the Registrant. E
23 Consent of Ernst & Young LLP. E
27 Financial Data Schedule as of December 31, E
1999 and for the year then ended.
27.1 Restated Financial Data Schedule as of E
December 31, 1998 and for the year then ended.
27.2 Restated Financial Data Schedule as of E
December 31, 1997 and for the year then ended.
- ----------------
*Executive Compensation Plans and Arrangements:
Amended and Restated TI Deferred Compensation Plan.
First Amendment to Restated TI Deferred Compensation Plan.
Second Amendment to Restated TI Deferred Compensation Plan.
TI Employees Supplemental Pension Plan.
First Amendment to TI Supplemental Pension Plan.
Texas Instruments Long-Term Incentive Plan (incorporated by
reference to Exhibit 10(a)(ii) to the Registrant's Annual Report on
Form 10-K for the year 1993).
Texas Instruments 1996 Long-Term Incentive Plan (incorporated by
reference to Exhibit 10 to the Registrant's Quarterly Report on Form
10-Q for the quarter ended June 30, 1996).
Texas Instruments Executive Officer Performance Plan (incorporated
by reference to the Registrant's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1997).
EXHIBIT 3(k)
------------
CERTIFICATE OF OWNERSHIP AND MERGER
MERGING
INTERSECT TECHNOLOGIES, INC.
WITH AND INTO
TEXAS INSTRUMENTS INCORPORATED
Pursuant to Section 253 of the
General Corporation of Law
of the State of Delaware
Texas Instruments Incorporated, a Delaware corporation (the
"Company"), does hereby certify to the following facts relating to the merger
(the "Merger") of Intersect Technologies, Inc., a Delaware corporation (the
"Subsidiary"), with and into the Company, with the Company remaining as the
surviving corporation:
FIRST: The Company is incorporated pursuant to the General
Corporation Law of the State of Delaware (the "DGCL"). The Subsidiary is
incorporated pursuant to the DGCL.
SECOND: The Company owns all of the outstanding shares of each
class of capital stock of the Subsidiary.
THIRD: The Board of Directors of the Company, by the following
resolutions duly adopted at a meeting of the Board on July 15, 1999,
determined to merge the Subsidiary with and into the Company pursuant to
Section 253 of the DGCL:
RESOLVED, that the Board of Directors of the Company
has deemed it advisable that Intersect Technologies,
Inc. (the "Subsidiary") be merged with and into the
Company pursuant to Section 253 of the General Corpora
tion Law of the State of Delaware; and it is
FURTHER RESOLVED, that the Subsidiary be merged with
and into the Company (the "Merger"); and it is
FURTHER RESOLVED, that by virtue of the Merger and
without any action on the part of the holder thereof,
each then outstanding share of common stock of the
Company shall remain unchanged and continue to remain
outstanding as one share of common stock of the
Company, held by the person who was the holder of such
share of common stock of the Company immediately prior
to the Merger; and it is
FURTHER RESOLVED, that by virtue of the Merger and
without any action on the part of the holder thereof,
each then outstanding share of common stock of the
Subsidiary shall be cancelled and no consideration
shall be issued in respect thereof; and it is
FURTHER RESOLVED, that the proper officers of the
Company be and they hereby are authorized and directed
to make, execute and acknowledge, in the name and under
the corporate seal of the Company, a Certificate of
Ownership and Merger for the purpose of effecting the
Merger and to file the same in the office of the
Secretary of State of the State of Delaware, and to do
all other acts and things that may be necessary to
carry out and effectuate the purpose and intent of the
resolutions relating to the Merger; and it is
FURTHER RESOLVED, that the Merger shall be effective
upon the date of filing of the Certificate of Ownership
and Merger with the Secretary of State of the State of
Delaware; and it is
FURTHER RESOLVED, that the appropriate officers of the
Company be, and each hereby is, authorized, on behalf
of the Company to do all things and to take any other
actions in furtherance of the foregoing resolutions as
such officer may deem necessary or appropriate.
FOURTH: The Company shall be the surviving corporation of the Merger.
FIFTH: The Certificate of Incorporation of the Company as in effect
immediately prior to the effective time of the Merger shall be the Certificate
of Incorporation of the surviving corporation.
IN WITNESS WHEREOF, the Company has caused this Certificate of
Ownership and Merger to be executed by its duly authorized officer this 15th
day of July, 1999.
TEXAS INSTRUMENTS INCORPORATED
By: /s/ RICHARD J. AGNICH
---------------------------------
Name: Richard J. Agnich
Office: Senior Vice President, Secretary
and General Counsel
EXHIBIT 3(l)
------------
CERTIFICATE OF OWNERSHIP AND MERGER
MERGING
SOFT WAREHOUSE, INC.
WITH AND INTO
TEXAS INSTRUMENTS INCORPORATED
Pursuant to Section 253 of the
General Corporation of Law
of the State of Delaware
Texas Instruments Incorporated, a Delaware corporation (the
"Company"), does hereby certify to the following facts relating to the merger
(the "Merger") of Soft Warehouse, Inc., a Hawaii corporation (the
"Subsidiary"), with and into the Company, with the Company remaining as the
surviving corporation:
FIRST: The Company is incorporated pursuant to the General
Corporation Law of the State of Delaware (the "DGCL"). The Subsidiary is
incorporated pursuant to the laws of the State of Hawaii.
SECOND: The Company owns all of the outstanding shares of each
class of capital stock of the Subsidiary.
THIRD: The Board of Directors of the Company, by the following
resolutions duly adopted at a meeting of the Board on September 16, 1999,
determined to merge the Subsidiary with and into the Company pursuant to
Section 253 of the DGCL:
RESOLVED, that the Board of Directors of the Company
has deemed it advisable that Soft Warehouse, Inc.
(the "Subsidiary") be merged with and into the
Company pursuant to Section 253 of the General
Corporation Law of the State of Delaware and Section
415-75, Hawaii Revised Statutes; and it is
FURTHER RESOLVED, that the Subsidiary be merged with
and into the Company (the "Merger"); and it is
FURTHER RESOLVED, that by virtue of the Merger and
without any action on the part of the holder thereof,
each then outstanding share of common stock of the
Company shall remain unchanged and continue to remain
outstanding as one share of common stock of the
Company, held by the person who was the holder of
such share of common stock of the Company immediately
prior to the Merger; and it is
FURTHER RESOLVED, that by virtue of the Merger and
without any action on the part of the holder thereof,
each then outstanding share of common stock of the
Subsidiary shall be cancelled and no consideration
shall be issued in respect thereof; and it is
FURTHER RESOLVED, that the proper officers of the
Company be and they hereby are authorized and
directed to make, execute and acknowledge, in the
name and under the corporate seal of the Company, a
Certificate of Ownership and Merger for the purpose
of effecting the Merger and to file the same in the
office of the Secretary of State of the State of
Delaware, and to do all other acts and things that
may be necessary to carry out and effectuate the
purpose and intent of the resolutions relating to the
Merger; and it is
FURTHER RESOLVED, that the Merger shall be effective
on September 30, 1999; and it is
FURTHER RESOLVED, that the appropriate officers of
the Company be, and each hereby is, authorized, on
behalf of the Company to do all things and to take
any other actions in furtherance of the foregoing
resolutions as such officer may deem necessary or
appropriate.
FOURTH: The Company shall be the surviving corporation of the
Merger.
FIFTH: The Restated Certificate of Incorporation of the Company as
in effect immediately prior to the effective time of the Merger shall be the
Certificate of Incorporation of the surviving corporation.
IN WITNESS WHEREOF, the Company has caused this Certificate of
Ownership and Merger to be executed by its duly authorized officer this 23rd
day of September, 1999.
TEXAS INSTRUMENTS INCORPORATED
By: /s/ RICHARD J. AGNICH
---------------------------------
Name: Richard J. Agnich
Office: Senior Vice President, Secretary
and General Counsel
EXHIBIT 3(m)
------------
CERTIFICATE OF OWNERSHIP AND MERGER
MERGING
SILICON SYSTEMS, INC.
WITH AND INTO
TEXAS INSTRUMENTS INCORPORATED
Pursuant to Section 253 of the
General Corporation of Law
of the State of Delaware
Texas Instruments Incorporated, a Delaware corporation (the
"Company"), does hereby certify to the following facts relating to the merger
(the "Merger") of Silicon Systems, Inc., a Delaware corporation (the
"Subsidiary"), with and into the Company, with the Company remaining as the
surviving corporation:
FIRST: The Company is incorporated pursuant to the General
Corporation Law of the State of Delaware (the "DGCL"). The Subsidiary is
incorporated pursuant to the DGCL.
SECOND: The Company owns all of the outstanding shares of each
class of capital stock of the Subsidiary.
THIRD: The Board of Directors of the Company, by the following
resolutions duly adopted at a meeting of the Board on December 2, 1999,
determined to merge the Subsidiary with and into the Company pursuant to
Section 253 of the DGCL:
RESOLVED, that the Board of Directors of the Company
has deemed it advisable that Silicon Systems, Inc.
(the "Subsidiary") be merged with and into the
Company pursuant to Section 253 of the General
Corporation Law of the State of Delaware; and it is
FURTHER RESOLVED, that the Subsidiary be merged with
and into the Company (the "Merger"); and it is
FURTHER RESOLVED, that by virtue of the Merger and
without any action on the part of the holder thereof,
each then outstanding share of common stock of the
Company shall remain unchanged and continue to remain
outstanding as one share of common stock of the
Company, held by the person who was the holder of
such share of common stock of the Company immediately
prior to the Merger; and it is
FURTHER RESOLVED, that by virtue of the Merger and
without any action on the part of the holder thereof,
each then outstanding share of common stock of the
Subsidiary shall be cancelled and no consideration
shall be issued in respect thereof; and it is
FURTHER RESOLVED, that the proper officers of the
Company be and they hereby are authorized and
directed to make, execute and acknowledge, in the
name and under the corporate seal of the Company, a
Certificate of Ownership and Merger for the purpose of
effecting the Merger and to file the same in the
office of the Secretary of State of the State of
Delaware, and to do all other acts and things that
may be necessary to carry out and effectuate the
purpose and intent of the resolutions relating to the
Merger; and it is
FURTHER RESOLVED, that the Merger shall be effective
upon the date of filing of this Certificate of
Ownership and Merger with the Secretary of State of the
State of Delaware; and it is
FURTHER RESOLVED, that the appropriate officers of
the Company be, and each hereby is, authorized on
behalf of the Company to do all things and to take
any other actions in furtherance of the foregoing
resolutions as such officer may deem necessary or
appropriate.
FOURTH: The Company shall be the surviving corporation of the
Merger.
FIFTH: The Restated Certificate of Incorporation of the Company as
in effect immediately prior to the effective time of the Merger shall be the
Certificate of Incorporation of the surviving corporation.
IN WITNESS WHEREOF, the Company has caused this Certificate of
Ownership and Merger to be executed by its duly authorized officer this 17th
day of December, 1999.
TEXAS INSTRUMENTS INCORPORATED
By: /s/ RICHARD J. AGNICH
---------------------------------
Name: Richard J. Agnich
Office: Senior Vice President, Secretary
and General Counsel
Exhibit 3(n)
------------
TEXAS INSTRUMENTS INCORPORATED
BY-LAWS
(As Amended Through January 20, 2000)
Index*
Page
ARTICLE I - Offices
Section 1. Registered Office . . . . . . . . . . . . . . . 1
2. Other Offices . . . . . . . . . . . . . . . . . 1
ARTICLE II - Meetings of Stockholders
Section 1. Annual Meetings . . . . . . . . . . . . . . . . 1
2. Special Meetings . . . . . . . . . . . . . . . . 2
3. Place of Meeting . . . . . . . . . . . . . . . . 2
4. Notice of Meetings . . . . . . . . . . . . . . . 2
5. Quorum . . . . . . . . . . . . . . . . . . . . . 3
6. Voting . . . . . . . . . . . . . . . . . . . . . 3
7. List of Stockholders . . . . . . . . . . . . . . 4
8. Inspectors . . . . . . . . . . . . . . . . . . . 5
9. Nomination of Directors; Notice of
Stockholder Nominees . . . . . . . . . . . . 5
10. Business at Annual Meeting; Notice
of Stockholder Business . . . . . . . . . . . 7
ARTICLE III - Board of Directors
Section 1. General Powers . . . . . . . . . . . . . . . . . 8
2. Number, Term of Office and
Qualifications . . . . . . . . . . . . . . . 8
3. Election of Directors . . . . . . . . . . . . . 9
4. Organization and Order of Business . . . . . . . 9
5. Resignations . . . . . . . . . . . . . . . . . . 9
6. Vacancies and Increases . . . . . . . . . . . . 9
7. Emergency By-Laws and Other
Powers in Emergency . . . . . . . . . . . . . 10
8. Place of Meeting . . . . . . . . . . . . . . . . 11
9. Annual Meetings . . . . . . . . . . . . . . . . 11
10. Regular Meetings . . . . . . . . . . . . . . . . 11
11. Special Meetings; Notice . . . . . . . . . . . . 12
12. Quorum and Manner of Acting . . . . . . . . . . 13
13. Compensation . . . . . . . . . . . . . . . . . . 13
*This Index is not part of the official text of the By-Laws.
Page
ARTICLE IV - Committees of Directors
Section 1. Appointment of Committees . . . . . . . . . . . 14
2. Procedure . . . . . . . . . . . . . . . . . . . 15
3. Minutes of Committee Proceedings . . . . . . . . 15
ARTICLE V - Officers
Section 1. Officers . . . . . . . . . . . . . . . . . . . . 15
2. Election and Term of Office . . . . . . . . . . 16
3. Election by Board Committee or Officer . . . . . 16
4. Removal . . . . . . . . . . . . . . . . . . . . 16
5. Resignations . . . . . . . . . . . . . . . . . . 17
6. Vacancies . . . . . . . . . . . . . . . . . . . 17
7. Chairman of the Board of Directors . . . . . . . 17
8. President . . . . . . . . . . . . . . . . . . . 17
9. Inability of Chairman of the Board
and President to Act . . . . . . . . . . . . 18
10. Executive Vice Presidents,
Senior Vice Presidents and
Vice Presidents . . . . . . . . . . . . . . . 18
11. The Secretary . . . . . . . . . . . . . . . . . 18
12. The Assistant Secretary . . . . . . . . . . . . 19
13. The Treasurer . . . . . . . . . . . . . . . . . 19
14. The Assistant Treasurer . . . . . . . . . . . . 20
15. Salaries . . . . . . . . . . . . . . . . . . . . 21
ARTICLE VI - Limitation of Liability and Indemnification
of Directors, Officers and Certain
Representatives of the Corporation
Section 1. Limitation of Liability . . . . . . . . . . . . 21
2. Indemnification of Directors,
Officers and Employees . . . . . . . . . . . 22
ARTICLE VII - Contracts, Checks, Drafts, Bank Accounts,
Books and Records, etc.
Section 1. Execution of Contracts . . . . . . . . . . . . . 23
2. Loans . . . . . . . . . . . . . . . . . . . . . 23
3. Checks, Drafts, etc . . . . . . . . . . . . . . 24
4. Deposits . . . . . . . . . . . . . . . . . . . . 24
5. General and Special Bank Accounts . . . . . . . 24
6. Proxies in Respect of Stock or Other
Securities of Other Corporations . . . . . . 25
Page
ARTICLE VIII - Books and Records . . . . . . . . . . . . . . . 26
ARTICLE IX - Shares and Their Transfer; Examination
of Books
Section 1. Certificates for Stock . . . . . . . . . . . . . 26
2. Transfers of Stock . . . . . . . . . . . . . . . 27
3. Regulations . . . . . . . . . . . . . . . . . . 27
4. Lost, Destroyed, Stolen, and
Mutilated Certificates . . . . . . . . . . . 28
5. Fixing Record Date . . . . . . . . . . . . . . . 28
ARTICLE X - Seal . . . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE XI - Fiscal Year . . . . . . . . . . . . . . . . . . . 29
ARTICLE XII - Notices and Waivers Thereof . . . . . . . . . . 29
ARTICLE XIII - Annual Financial Statement . . . . . . . . . . 30
ARTICLE XIV - Amendments . . . . . . . . . . . . . . . . . . . 31
B Y - L A W S
of
TEXAS INSTRUMENTS INCORPORATED
ARTICLE I
Offices
Section 1. Registered Office. The registered office of the
Corporation in the State of Delaware shall be at 100 West Tenth Street, in the
City of Wilmington, County of New Castle, and the name of the registered agent
in charge thereof is The Corporation Trust Company.
Section 2. Other Offices. The Corporation may also have a general
office in the City of Dallas, State of Texas, and may also have such other
office or offices, either within or without the State of Delaware, as the
Board of Directors may from time to time appoint or as the business of the
Corporation may require.
ARTICLE II
Meetings of Stockholders
Section 1. Annual Meetings. An annual meeting of the stockholders
of the Corporation shall be held on the third Thursday in April in each year
or on such other date as may be fixed from time to time by the Board of
Directors, at such hour as may be specified in the notice thereof, for the
purpose of electing directors and for the transaction of such other business
as may properly be brought before such meeting. If any annual meeting shall
not be held on the day designated or as provided herein, the Board of
Directors shall cause the meeting of the stockholders to be held as soon
thereafter as convenient for the election of such directors. A failure to
hold the annual meeting of the stockholders at the designated time or to elect
a sufficient number of directors to conduct the business of the Corporation
shall not affect otherwise valid corporate acts and shall not work any
forfeiture or dissolution of the Corporation.
Section 2. Special Meetings. Special meetings of the stockholders,
for any purpose or purposes, may be called at any time by the Chairman of the
Board, President or the Board of Directors, and shall be called by the
Chairman of the Board, President or the Secretary at the request in writing of
a majority of the Board of Directors, except as otherwise provided by law or
in the Certificate of Incorporation or any amendment thereto.
Section 3. Place of Meeting. All meetings of the stockholders for
the election of directors shall be held in the City of Dallas, State of Texas,
at such place within such City as may be fixed from time to time by the Board
of Directors, or at such other place either within or without the State of
Delaware as shall be designated from time to time by the Board of Directors
and stated in the notice of the meeting. All other meetings of the
stockholders shall be held at such places, within or without the State of
Delaware, as may from time to time be fixed by the Board of Directors or as
shall be specified or fixed in the respective notices or waivers of notice
thereof.
Section 4. Notice of Meetings. Except as otherwise expressly
required by law or by these By-Laws, notice of each meeting of the
stockholders, whether annual or special, shall be given not less than ten (10)
nor more than sixty (60) days before the date of the meeting, to each
stockholder of record of the Corporation entitled to vote at such meeting by
delivering a written or printed notice thereof to him personally or by
depositing such notice in the United States mail postage prepaid, directed to
the stockholder at his address as it appears upon the records of the
Corporation. Every such notice shall state the place, date and hour of the
meeting and, if the meeting be special, briefly, the purpose or purposes
thereof. Except when expressly required by law, no publication of any notice
of a meeting of the stockholders shall be required; and except when expressly
required by law, no notice of any adjourned meeting of the stockholders of the
Corporation need be given.
Section 5. Quorum. At all meetings of the stockholders (except
where otherwise provided by law, by the Certificate of Incorporation or by
these By-Laws) stockholders holding of record a majority of the shares of
stock of the Corporation issued and outstanding and entitled to vote thereat,
present in person or by proxy, shall constitute a quorum for the transaction
of business. Except as otherwise expressly provided by law, in the absence of
a quorum at any such meeting or any adjournment or adjournments thereof, a
majority in voting interest of those present in person or by proxy and voting
thereon may adjourn such meeting from time to time, until a quorum shall be
present, without notice other than announcement at the meeting, except that if
the adjournment is for more than thirty (30) days, or if after the adjournment
a new record date is fixed for the adjourned meeting, a notice of the
adjourned meeting shall be given to each stockholder entitled to vote at the
meeting. At any adjourned meeting at which a quorum may be present any
business may be transacted which might have been transacted at the meeting as
originally called. The absence from any meeting of stockholders holding the
number of shares of stock of the Corporation having voting powers required by
the laws of the State of Delaware or by the Certificate of Incorporation or by
these By-Laws for action upon any given matter shall not prevent action at
such meeting upon any other matter or matters which may properly come before
the meeting, if there shall be present thereat in person or by proxy
stockholders entitled to vote thereat holding the number of shares of stock of
the Corporation having voting power required in respect of such other matter
or matters.
Section 6. Voting. Except as otherwise expressly provided by law
or by the Certificate of Incorporation or by these By-Laws, each stockholder of
the Corporation shall, at each meeting of the stockholders, be entitled to one
vote in person or by proxy for each share of the stock of the Corporation
having voting powers held by him and registered in his name on the books of
the Corporation on the date fixed pursuant to the provisions of Section 5 of
Article IX of these By-Laws as the record date for the determination of
stockholders who shall be entitled to notice of and to vote at such meeting.
Shares of its own stock belonging to the Corporation, or to another
corporation if a majority of the shares entitled to vote in the election of
directors of such other corporation is held by the Corporation, shall not be
voted nor counted for quorum purposes. At all meetings of the stockholders
all matters except those the manner of deciding upon which shall otherwise be
expressly regulated by law or by the Certificate of Incorporation or by these
By-Laws, shall be decided by the vote of a majority in voting interest of the
stockholders present in person or by proxy and entitled to vote thereat, a
quorum being present. The vote for directors, and upon the demand of any
stockholder, the vote upon any question before the meeting shall be by written
ballot.
Section 7. List of Stockholders. It shall be the duty of the
Secretary or other officer of the Corporation who shall have charge of its
stock ledger, either directly or through a transfer agent or transfer clerk
appointed by the Board of Directors, to prepare and make, at least ten (10)
days before every meeting of the stockholders a complete alphabetically
arranged list of the stockholders showing the address of each stockholder and
the number of shares registered in the name of each stockholder. Such list
shall be open to the examination of any stockholder, for any purpose germane
to the meeting, during ordinary business hours, for a period of at least ten
(10) days prior to the meeting, either at a place within the city where the
meeting is to be held, which place shall be specified in the notice of the
meeting, or, if not so specified, at the place where the meeting is to be
held. The list shall also be produced and kept at the time and place of the
meeting during the whole time thereof, and may be inspected by any stockholder
who is present. The stock ledger shall be the only evidence as to who are the
stockholders entitled to examine the stock ledger, the list required by this
section or the books of the Corporation, or to vote in person or by proxy at
any meeting of stockholders.
Section 8. Inspectors. Prior to each meeting of the stockholders,
two Inspectors shall be appointed by the Board of Directors, or, if no such
appointment shall have been made, such Inspectors shall be appointed by the
Chairman of the meeting, to act thereat. Each Inspector so appointed shall
first subscribe an oath or affirmation faithfully to execute the duties of an
inspector at such meeting with strict impartiality and according to the best
of his ability.
Such Inspectors shall take charge of the ballots at such meeting and
after the balloting thereat on any question shall count the ballots cast
thereon and shall make a report in writing to the secretary of such meeting of
the results thereof. The Inspectors need not be stockholders of the
Corporation, and any officer of the Corporation may be an Inspector on any
question other than a vote for or against his election to any position with
the Corporation or on any other question in which he may be directly
interested other than as a stockholder.
Section 9. Nomination of Directors; Notice of Stockholder Nominees.
Except as provided in Section 6 of Article III of these By-Laws, only persons
who are nominated in accordance with the following procedures shall be
eligible for election as directors. Nominations of persons for election to
the Board of Directors of the Company may be made at an annual meeting of
stockholders (a) by or at the direction of the Board of Directors or (b) by
any stockholder of the Company entitled to vote for the election of directors
at the meeting who complies with the notice procedures set forth in this
Section 9 of Article II. Such nominations, other than those made by or at
the direction of the Board of Directors, shall be made pursuant to timely
notice in writing to the Secretary of the Company. To be timely, a
stockholder's notice shall be delivered to or mailed and received at the
principal executive offices of the Company not less than 90 days prior to the
first anniversary of the preceding year's annual meeting; provided, however,
that in the event that the date of the annual meeting is advanced by more than
30 days, or delayed by more than 70 days, from such anniversary date, notice
by the stockholder to be timely must be so delivered not later than the close
of business on the later of the ninetieth day prior to such annual meeting or
the tenth day following the day on which public announcement of the date of
such meeting is first made. Such stockholder's notice to the Secretary shall
set forth (a) as to each person whom the stockholder proposes to nominate for
election or re-election as a director, (i) the name, age, business address and
residence address of the person, (ii) the principal occupation or employment
of the person, (iii) the class and number of shares of stock of the Company
which are beneficially owned by the person, (iv) the person's written consent
to serve as a director if elected, and (v) any other information relating to
the person that would be required to be disclosed in solicitations for proxies
for election of directors pursuant to Regulation 14A under the Securities
Exchange Act of 1934, as amended; and (b) as to the stockholder giving the
notice, (i) the name and address of the stockholder and the beneficial owner,
if any, on whose behalf the nomination is made, (ii) the class and number of
shares of stock of the Company which are beneficially owned by the stockholder
and such beneficial owner, and (iii) whether the proponent intends or is part
of a group which intends to solicit proxies from other stockholders in support
of such nomination. The Company may require any proposed nominee to furnish
such other information as may reasonably be required by the Company to
determine the eligibility of such proposed nominee to serve as a director of
the Company.
The Chairman of the annual meeting shall, if the facts warrant,
determine and declare to the meeting that a nomination was not made in
accordance with the provisions of this Section 9 of Article II, and the
defective nomination shall be disregarded.
Section 10. Business at Annual Meeting; Notice of Stockholder
Business. To be properly brought before an annual meeting of stockholders,
business must be either (a) specified in the notice of meeting (or any
supplement thereto) given by or at the direction of the Board of Directors, or
(b) otherwise properly brought before the meeting by or at the direction of
the Board of Directors or by a stockholder. In addition to any other
applicable requirements, for business to be properly brought before the
meeting by a stockholder, the stockholder must have given timely notice
thereof in writing to the Secretary of the Company. To be timely, a
stockholder's notice must be delivered to or mailed and received at the
principal executive offices of the Company not less than 90 days prior to the
first anniversary of the preceding year's annual meeting; provided, however,
that in the event that the date of the annual meeting is advanced by more than
30 days, or delayed by more than 70 days, from such anniversary date, notice
by the stockholder to be timely must be so delivered not later than the close
of business on the later of the ninetieth day prior to such annual meeting or
the tenth day following the day on which public announcement of the date of
such meeting is first made. A stockholder's notice to the Secretary shall set
forth as to each matter the stockholder proposes to bring before the meeting
(i) a brief description of the business desired to be brought before the
meeting and the reason for conducting such business at the meeting, (ii) the
name and address of the stockholder and the beneficial owner, if any,
proposing such business, (iii) the class and number of shares of stock of the
Company which are beneficially owned by the stockholder and such beneficial
owner, (iv) any material interest in such business of the stockholder and the
beneficial owner, if any, on whose behalf the proposal is made, and (v)
whether the proponent intends or is part of a group which intends to solicit
proxies from other stockholders in support of such proposal.
Notwithstanding anything in these By-Laws to the contrary, no
business shall be conducted at any annual meeting except in accordance with
the procedures set forth in this Section 10 of Article II; provided, however,
that nothing in this Section 10 of Article II shall be deemed to preclude
discussion by any stockholder of any business properly brought before the
meeting.
The Chairman of the annual meeting shall, if the facts warrant,
determine and declare to the meeting that business was not properly brought
before the meeting in accordance with the provisions of this Section 10 of
Article II, and any such business shall not transacted.
ARTICLE III
Board of Directors
Section 1. General Powers. The property, business and affairs of
the Corporation shall be managed under the direction of the Board of
Directors, who may exercise all such powers of the Corporation and do all such
lawful acts and things as are not by law, by the Certificate of Incorporation
or by these By-Laws directed or required to be exercised or done by the
stockholders.
Section 2. Number, Term of Office and Qualifications. The number
of directors which shall constitute the whole Board shall be fifteen (15)
until changed by further resolution of the Board of Directors of the Company.
Directors need not be stockholders.
Except as provided by Section 6 of Article III of these By-Laws, the
directors shall be elected annually, and each director shall continue in
office until his successor shall have been elected and shall qualify or until
his death or other termination of his services. No person shall be eligible
for election or re-election as a director of the Corporation after attaining
age seventy.
Section 3. Election of Directors. Except as provided in Section 6
of Article III of these By-Laws, the directors shall be elected by plurality
vote of the stockholders present in person or by proxy and entitled to vote at
the annual meeting of the stockholders, a quorum being present.
Section 4. Organization and Order of Business. At all meetings of
the Board of Directors, the Chairman of the Board of Directors shall preside.
In his absence, the President, or, in the absence of both of these officers, a
member of the Board of Directors chosen by a majority of the directors present
thereat, shall act as Chairman of such meeting and preside thereat. The
Secretary, or, in his absence, an Assistant Secretary, or, in the absence of
all of them, any person appointed by the Chairman of the meeting, shall act as
secretary of such meeting.
Section 5. Resignations. Any director of the Corporation may resign
at any time by giving notice of his resignation to the Chairman of the Board,
the President or the Secretary of the Corporation. Any such resignation shall
take effect at the time specified therein or, if the time when it shall become
effective shall not be specified therein, immediately upon its receipt by such
Chairman of the Board, President or Secretary; and, unless otherwise specified
therein, the acceptance of such resignation shall not be necessary to make it
effective.
Section 6. Vacancies and Increases. Vacancies and newly created
directorships resulting from any increase in the authorized number of
directors may be filled by a majority of the directors then in office although
less than a quorum, or by a sole remaining director. Any vacancy not filled
in such manner may be filled by the stockholders at any special meeting of the
stockholders called for that purpose.
Section 7. Emergency By-Laws and Other Powers in Emergency. During
any emergency resulting from an attack on the United States, or during any
nuclear or atomic disaster, or during the existence of any catastrophe, or
other similar emergency conditions, as a result of which a quorum of the Board
of Directors or a standing committee thereof cannot readily be convened for
action, the following provisions shall be applicable:
(a) Emergency Management Committee. If a quorum of one or more
committees created pursuant to Article IV of these By-Laws cannot readily be
convened for action within their respective jurisdictions and a quorum of the
Board of Directors cannot readily be convened to act, then all the powers and
duties vested in the committee or committees or the Board of Directors so
lacking a quorum shall vest, automatically, in the Emergency Management
Committee, which shall consist of all readily available members of the Board
of Directors. Two members shall constitute a quorum unless there is only one,
in which case one shall constitute a quorum. Other provisions of these
By-Laws notwithstanding, the Emergency Management Committee (1) shall call a
meeting of the Board of Directors as soon as circumstances permit for the
purpose of filling vacancies on the Board of Directors and its Committees and
to take such other action as may be appropriate and (2) if the Emergency
Management Committee determines that less than a majority of the members of
the Board of Directors are available for service, shall issue a call for a
special meeting of stockholders to be held at the earliest date practicable
for the election of directors.
(b) If there are no remaining directors, the officers (not
exceeding the number of directors then authorized) who have at that time the
longest period of employment continuous to such date uninterrupted by leave of
absence in the office or offices (in the following order) of (1) Executive
Vice President, (2) Group Vice President, (3) Senior Vice President, (4) Vice
President, and (5) Assistant Vice President, shall be deemed directors for any
meeting of the Board of Directors until the termination of the emergency, or
until a meeting of the stockholders can conveniently and safely be convened,
whichever shall first occur. If two or more persons shall have been elected
to the same office on the same day the person or persons to be deemed a
director or directors shall be the person or persons with the longest
continuous period of service uninterrupted by leave of absence with the
Corporation.
(c) The Board of Directors, either before or during any such
emergency, may provide, and from time to time modify, lines of succession in
the event that during such emergency any or all officers or agents of the
Corporation shall for any reason be rendered incapable of discharging their
duties.
Section 8. Place of Meeting. The Board of Directors may hold its
meetings at such place or places within or without the State of Delaware as
the Board of Directors may from time to time by resolution determine, or as
shall be specified or fixed in these By-Laws, or in the respective notices or
waivers of notice thereof.
Section 9. Annual Meetings. After each annual election of
directors the Board of Directors shall meet for the purpose of organization,
the election of officers of the Corporation and the transaction of other
business, as soon thereafter as practicable, at the place where the meeting of
stockholders for the election of directors was held. Notice of such meeting
or of any adjournment thereof need not be given. Such meeting may be held at
any other time or place which shall be specified in a notice given as
hereinafter provided for special meetings of the Board of Directors or in a
waiver of notice thereof in accordance with these By-Laws.
Section 10. Regular Meetings. Regular meetings of the Board of
Directors shall be held at such times as the Board of Directors shall, from
time to time, by resolution, determine. If no other place be fixed by
resolution for such regular meetings they shall be held at the general office
of the Corporation in the City of Dallas, State of Texas. Except as otherwise
provided by law or by these By-Laws, notices of regular meetings need not be
given. The time and place of any regular meeting may be changed on three
days' notice to each director, as in the manner provided for notice of special
meetings of the Board of Directors, from the Chairman of the Board of
Directors, the President, or the Secretary or an Assistant Secretary.
Section 11. Special Meetings; Notice. Special meetings of the
Board of Directors, for any purpose or purposes, shall be held whenever called
by the Chairman of the Board or the President. A special meeting shall be
called by the Chairman of the Board, President or Secretary upon the written
request of four directors, or such lesser number constituting one-half of the
total number of directors at the time in office. A notice shall be given as
hereinafter in this Section provided of each such special meeting, in which
shall be stated the time and place of such meeting, but except as otherwise
expressly provided by law or by these By-Laws, the purposes thereof need not
be stated in such notice. Except as otherwise provided by law, notice of each
such meeting shall be mailed to each director, addressed to him at his
residence or usual place of business, at least three days before the day on
which such meeting is to be held, or shall be sent addressed to him at such
place by telegraph, cable or wireless or be delivered personally or by
telephone not later than the day before the day on which such meeting is to be
held. Notice of any meeting of the Board need not, however, be given to any
director, if waived by him at any time, whether before or after the meeting,
in writing or by telegraph, cable or wireless, or if he shall be present at
such meeting; and any special meeting of the Board shall be a legal meeting
without any notice thereof having been given if all the directors of the
Corporation then in office shall be present thereat.
Section 12. Quorum and Manner of Acting. At all meetings of the
Board of Directors, one-third of the total number of directors shall
constitute a quorum for the transaction of business; and, except as otherwise
specified in Section 1 of Article IV, Section 4 of Article V, and Article XIV
of these By-Laws, and except as may otherwise be expressly provided by law or
by the Certificate of Incorporation, the act of a majority of the directors
present shall be the act of the Board of Directors. Members of the Board of
Directors may participate in any meeting of such Board by means of conference
telephone or similar communications equipment by means of which all persons
participating in the meeting can hear each other, and such participation in
the meeting shall constitute presence in person at such meeting. In the
absence of a quorum at any meeting, it may be adjourned, from time to time,
until a quorum shall be present thereat. Notice of any adjourned meeting need
not be given. The directors shall act only as a Board and the individual
directors shall have no power as such.
Section 13. Compensation. The Board of Directors may at any time
and from time to time by resolution provide that a specified sum shall be paid
to any director of the Corporation or to any director member of any Committee
who shall not otherwise be in the employ of the Corporation or of any
subsidiary of the Corporation, either as his annual compensation as such
director, member of such committee or as compensation for his attendance at
any annual, regular, or special meeting of the Board or of such committee or
other activities as a director; and the Board of Directors may also likewise
provide that the Corporation shall reimburse each such director or member of
such committee for any expenses paid by him on account of his attendance at
any such meeting or his engaging in other activities as a director. Unless
otherwise expressly provided by resolution adopted by the Board of Directors,
none of the directors and none of the members of any committee of directors of
the Corporation contemplated by these By-Laws or otherwise provided for by
resolution of the Board of Directors shall, as such, receive any stated
compensation for his services. Nothing in this Section shall be construed to
preclude any director from serving the Corporation in any other capacity and
receiving compensation therefor.
ARTICLE IV
Committees of Directors
Section 1. Appointment of Committees. The Board of Directors may,
by resolution passed by a majority of the whole Board, designate one or more
"Board Committees," each Committee to consist of one or more of the directors
of the Corporation which, to the extent provided in the resolution or in the
By-Laws of the Corporation, shall have and may exercise, as authorized by the
Board, the powers of the Board of Directors in the management of the business
and affairs of the Corporation, and may authorize the seal of the Corporation
to be affixed to all papers which may require it. The Board of Directors may
designate one or more directors as an alternative member of any committee, who
may replace any absent or disqualified member at any meeting of the Committee.
Such Board Committee or Committees shall serve during the pleasure of the
Board of Directors, and shall have such name or names as may be stated in the
By-Laws of the Corporation or as may be determined from time to time by
resolution adopted by the Board of Directors.
In addition, the Board of Directors may, by resolution passed by a
majority of the whole Board of Directors, designate one or more "Board
Appointed Committees" consisting of one or more of the directors of the
Corporation and such other members as it may designate to have such powers and
duties as the Board of Directors may determine. No additional compensation
shall be paid to such other members who are company executives in connection
with their attendance at meetings of Board Appointed Committees. The term and
names of such Board Appointed Committees shall be determined from time to time
by resolution adopted by the Board of Directors.
Section 2. Procedure. A majority of all the members of any
committee appointed pursuant to this Article IV may fix its rules of procedure,
determine its action, and fix the time and place, within or without the State
of Delaware, of its meetings, and specify what notice thereof, if any, shall
be given, unless the Board of Directors shall otherwise by resolution provide.
Unless the Board of Directors shall otherwise by resolution provide, the
members of any committee appointed pursuant to this Article IV may participate
in any meeting of such committee by means of conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, and such participation in the meeting shall
constitute presence in person at such meeting. The Board of Directors shall
have power at any time to change the members of any such committee, to fill
vacancies therein, and to discharge any such committee, either with or without
cause.
Section 3. Minutes of Committee Proceedings. The Board Committees
shall keep regular minutes of their proceedings and report the same to the
Board of Directors when required.
ARTICLE V
Officers
Section 1. Officers. The officers of the Corporation shall include
a Chairman of the Board of Directors and a President, who may be the same
person, and there may be one or more Vice Chairmen of the Board of Directors,
one or more Executive Vice Presidents, one or more Senior Vice Presidents, one
or more Vice Presidents, a Secretary, and a Treasurer, all of whom shall be
subject to the control of the Board of Directors. The Board of Directors may
designate a Chief Executive Officer and a Chief Operating Officer.
The Board of Directors may from time to time elect such other
officers and agents as the Board may deem necessary or advisable, including
one or more Assistant Vice Presidents, one or more Assistant Secretaries, one
or more Assistant Treasurers, a Controller and an Assistant Controller, each
of which officers and agents shall be subject to the control of the Board of
Directors and shall hold office for such period, have such authority and
perform such duties as are provided in these By-Laws or as the Board of
Directors or the President may from time to time determine.
Section 2. Election and Term of Office. Unless elected pursuant to
Section 3 of this Article V, the officers of the Corporation shall be elected
annually by the Board of Directors at the first meeting thereof held after the
annual meeting of stockholders for the election of officers. Each officer
shall hold office until his successor shall have been duly chosen and shall
have qualified or until his death or until he shall resign or shall have been
removed in the manner hereinafter provided.
Section 3. Election by Board Committee or Officer. The Board of
Directors may delegate to any officer or committee established by the Board of
Directors the power to elect any officers and agents of the Corporation.
Section 4. Removal. Except where otherwise expressly provided in a
contract duly authorized by the Board of Directors, all officers and agents of
the Corporation, elected by the Board of Directors, may be removed, either
with or without cause, at any time, by resolution adopted by a majority of the
whole Board of Directors at any regular meeting, or at any special meeting
called for the purpose, if notice of the regular or special meeting gave
notice of the proposed removal. Also, except where otherwise expressly
provided in a contract duly authorized by the Board of Directors, all other
officers shall hold their office, agency or employment at the discretion of,
and may be removed or discharged, with or without cause, by the Board of
Directors, by the committee or officer that elected them or by any superior
officer upon whom such power of removal may be conferred by the Board of
Directors.
Section 5. Resignations. Any officer of the Corporation may resign
at any time by giving written notice of his resignation to the Board of
Directors or to the Chairman of the Board or to the President or to the
Secretary of the Corporation. Any such resignation shall take effect at the
time specified therein, or, if the time when it shall become effective shall
not be specified therein, immediately upon its receipt by the Board of
Directors or such Chairman of the Board or President or Secretary; and, unless
otherwise specified therein, the acceptance of such resignation shall not be
necessary to make it effective.
Section 6. Vacancies. A vacancy in any office due to death,
resignation, removal, disqualification or any other cause may be filled for
the unexpired portion of the term in the manner prescribed in these By-Laws
for regular elections to such office.
Section 7. Chairman of the Board of Directors. The Chairman of the
Board of Directors shall be under the direction of the Board of Directors and
shall have the primary responsibility for the effective operation of the
Board. The Chairman shall preside at all meetings of the Board of Directors
and of the stockholders. In any prolonged absence or incapacity of the
President, he shall perform all the duties and functions and exercise all the
powers of the President.
Section 8. President. Unless otherwise determined by the Board of
Directors, the President shall be the Chief Executive Officer of the
Corporation under the supervision and direction of the Board and shall have
the primary responsibility for carrying out the policies of the Board. When
the President is absent temporarily in the ordinary course of business, he is
authorized to designate another senior officer to act in his behalf during his
absence. In the absence of the Chairman of the Board, he shall preside at all
meetings of the stockholders and the Board of Directors. He shall see that
all orders and resolutions of the Board of Directors are carried into effect.
He may sign, execute and deliver in the name of the Corporation all deeds,
mortgages, bonds, contracts or other instruments authorized by the Board of
Directors, and checks, notes and orders for the payment of money, except in
cases where the signing, execution or delivery thereof shall be expressly
delegated by the Board of Directors or by these By-Laws to some other officer
or agent of the Corporation or where any of them shall be required by law
otherwise to be signed, executed or delivered.
Section 9. Inability of Chairman of the Board and President to Act.
If the President and the Chairman of the Board are unable to act, the Board
shall determine by resolution who shall perform the duties of the President
and Chairman of the Board.
Section 10. Executive Vice Presidents, Senior Vice Presidents and
Vice Presidents. Each Executive Vice President, Senior Vice President and
Vice President shall have such powers and perform such duties as the Board of
Directors, the Chairman of the Board or the President may from time to time
prescribe and shall perform such other duties as may be prescribed by these
By-Laws.
Section 11. The Secretary. The Secretary shall attend and keep the
minutes of meetings of the stockholders, of the Board of Directors and (unless
the Board designates a secretary or secretaries for a committee or committees)
of all committees, in one or more books provided for that purpose; give notice
of all meetings in accordance with these By-Laws and as required by law; have
charge of the seal of the Corporation; he may sign with the Chairman of the
Board, President, Executive Vice President, Senior Vice President, Vice
President, or Assistant Vice President, in the name of the Corporation, all
contracts and instruments of conveyance authorized by the Board of Directors,
or by any committee thereunto duly authorized, and, when so ordered or
authorized he shall affix the seal of the Corporation thereto; he shall have
charge of the certificate books, transfer books and stock ledgers, and such
other books and papers as the Board of Directors may direct, all of which
shall, at all reasonable times, be open to the examination of any Director,
upon application at the office of the Corporation during business hours;
prepare and submit to the Board of Directors or the President such reports and
data as may be requested of him; and in general perform all the duties
incident to the office of Secretary, and such other duties as from time to
time may be assigned to him by the Board of Directors or the President. The
Board of Directors may from time to time delegate to another officer or person
any of the duties usually performed by the Secretary to the extent permitted
by law.
Section 12. The Assistant Secretary. At the request of the
Secretary or in the event of his absence or inability to act, the Assistant
Secretary or, if there be more than one, any of the Assistant Secretaries,
shall (unless the Board directs otherwise) perform the duties of the
Secretary, and, when so acting, shall have all the powers of, and be subject
to all the restrictions upon, the Secretary. Each Assistant Secretary shall
perform such other duties as from time to time may be assigned to him by the
President, the Secretary, or the Board of Directors.
Section 13. The Treasurer. The Treasurer shall be under the
direction of the officer who has been designated by the Board of Directors.
The principal financial officer of the Corporation may also hold the position
of Treasurer if so approved by the Board of Directors. If required by the
Board of Directors, the Treasurer shall give a bond for the faithful discharge
of his duties in such sum and with such surety or sureties as the Board of
Directors shall determine (and in the event such bond be required, a new bond
shall be taken at least every six years). The Treasurer shall have charge and
custody of, and be responsible for, all funds, securities, notes, valuable
effects and financial records of the Corporation, receive and give receipt for
moneys due and payable to the Corporation from any sources whatsoever; when
necessary or proper he shall endorse on behalf of the Corporation for
collection, checks, notes and other obligations and shall deposit the same to
the credit of the Corporation in such bank or banks or depositary or
depositaries as the Board of Directors may designate; he shall cause such
funds of the Corporation to be disbursed by checks or drafts on the authorized
banks or depositaries of the Corporation signed as provided in these By-Laws
or by resolution of the Board of Directors; he shall be responsible for the
accuracy of the amounts of, and cause to be preserved, proper vouchers for all
moneys so disbursed; he shall enter or cause to be entered regularly in the
books of the Corporation, to be kept by him or under his supervision for that
purpose, a full and accurate account of all the moneys received and paid by
him on account of the Corporation; he shall render to the Board of Directors,
the Chairman of the Board, or the President, whenever they shall require him
so to do, a statement of the cash account and such other financial statements
as may be prepared from the financial records, and as soon as may be
practicable after the close of each fiscal year make and submit to the Board
of Directors like report or reports for such fiscal year; and in general
perform all the duties incident to the office of Treasurer, and such other
duties as from time to time may be assigned to him by the Board of Directors
or the President. The Board of Directors may from time to time delegate to
another officer or person any of the duties usually performed by the Treasurer
to the extent permitted by law.
Section 14. The Assistant Treasurer. If required by the Board of
Directors, the Assistant Treasurer shall give a bond for the faithful
discharge of his duties in such sum and with such surety or sureties as the
Board of Directors shall determine (and in the event such bond be required, a
new bond shall be taken at least every six years). At the request of the
Treasurer or in the event of his absence or inability to act, the Assistant
Treasurer or, if there be more than one, any of the Assistant Treasurers,
shall (unless the Board directs otherwise) perform the duties of the Treasurer
and, when so acting, shall have all the powers of, and be subject to all the
restrictions upon, the Treasurer. Each Assistant Treasurer shall perform such
other duties as from time to time may be assigned to him by the President, the
Treasurer, or the Board of Directors.
Section 15. Salaries. The salaries of all officers of the
Corporation shall be determined or provided for from time to time by the Board
of Directors. No officer shall be prevented from receiving any such salary
because he is also a member of the Board of Directors.
ARTICLE VI
Limitation of Liability and Indemnification of
Directors, Officers and Certain
Representatives of the Corporation
Section 1. Limitation of Liability. No person shall be liable to
the Corporation for any loss or damage suffered by it on account of any action
taken or omitted to be taken in good faith as a director, member of a
directors' committee or officer of the Corporation, if such person exercised
or used the same degree of care and skill as a prudent man would have
exercised or used under the circumstances in the conduct of his own affairs.
Without limitation on the foregoing, any such person shall be deemed to have
exercised or used such degree of care and skill if he took or omitted to take
such action in reliance in good faith upon advice of counsel for the
Corporation, or the books of account or other records of the Corporation, or
reports or information made or furnished to the Corporation by any officials,
accountants, engineers, agents or employees of the Corporation, or by an
independent certified public accountant or auditor, engineer, appraiser or
other expert employed by the Corporation and selected with reasonable care by
the Board of Directors, by any such committee or by an authorized officer of
the Corporation.
Section 2. Indemnification of Directors, Officers and Employees.
The Corporation shall indemnify, in the manner and to the full extent
permitted by the laws of the State of Delaware, any former or present
director, officer or employee of the Corporation or of any subsidiary of the
Corporation (or the estate of any such person) who was or is a party to, or is
threatened to be made a party to, any threatened, pending or completed action,
suit or proceeding, whether or not by or in the right of the Corporation, and
whether civil, criminal, administrative, investigative or otherwise, by reason
of the fact that such person is or was a director, officer or employee of the
Corporation, or is or was serving any other enterprise at the request of the
Corporation; provided, however, that the Corporation shall indemnify any such
person seeking indemnification in connection with a proceeding (or part
thereof) initiated by such person only if such proceeding (or part thereof)
was authorized in advance by the Board of Directors of the Corporation. The
Corporation may, to the full extent permitted by the laws of the State of
Delaware, purchase and maintain insurance on behalf of any such person against
any liability which may be asserted against him. To the full extent permitted
by the laws of the State of Delaware, the indemnification provided herein
shall include expenses (including attorney's fees), judgments, fines and
amounts paid in settlement. In the manner provided by law, any such expenses
may be, and any such expenses incurred by any former or present director or
officer of the Corporation shall be, paid by the Corporation in advance of the
final disposition of such action, suit or proceeding. The indemnification
provided herein shall not be deemed to limit the right of the Corporation to
indemnify any other person for any such expenses to the full extent permitted
by law, nor shall it be deemed exclusive of any other rights to which any
person seeking indemnification from the Corporation may be entitled under any
agreement, vote of stockholders or disinterested directors or otherwise, both
as to action in his official capacity and as to action in another capacity
while holding such office. No amendment to or repeal of this Section 2 of
Article VI shall apply or be effective to limit or reduce the indemnification
rights provided under this Section 2 of Article VI with respect to any acts or
omissions occurring prior to such amendment or repeal.
ARTICLE VII
Contracts, Checks, Drafts, Bank Accounts,
Books and Records, etc.
Section 1. Execution of Contracts. The Board of Directors may
authorize any officer or officers or agent or agents of the Corporation to
enter into any contract or execute and deliver any instrument in the name and
on behalf of the Corporation, and such authority may be general or confined to
specific instances; and, unless so authorized by the Board of Directors, no
officer, agent or employee shall have any power or authority to bind the
Corporation by any contract or engagement or to pledge its credit or to render
it liable pecuniarily for any purpose or to any amount.
Section 2. Loans. No loan shall be contracted on behalf of the
Corporation, and no negotiable paper shall be issued in its name, unless
authorized (i) by the Board of Directors, or (ii) by a Committee of the Board
if the Board of Directors has delegated to any such Committee the power to
make such authorizations. When so authorized any officer or agent of the
Corporation may effect loans and advances at any time for the Corporation from
any bank, trust company or other institution, or from any firm, corporation or
individual, and for such loans and advances may make, execute and deliver
promissory notes or other evidences of indebtedness of the Corporation, and,
when authorized so to do by the Board of Directors, and, if required by law,
by the stockholders, as security for the payment of any and all loans,
advances, indebtedness and liabilities of the Corporation, may mortgage,
pledge, hypothecate or transfer any real or personal property at any time held
by the Corporation and to that end execute deeds of trust, and instruments of
mortgage or pledge, or otherwise transfer said property.
Section 3. Checks, Drafts, etc. All checks, drafts, orders for the
payment of money, obligations and bills of exchange shall be signed or
endorsed (except endorsements for collection for the account of the
Corporation or for deposit to its credit) by such officer or officers,
employee or employees or agent or agents of the Corporation and in such manner
as shall from time to time be determined by resolution of the Board of
Directors. Each of such officers and employees shall give such bond, if any,
as the Board of Directors shall determine.
Section 4. Deposits. All funds of the Corporation not otherwise
employed shall be deposited from time to time to the credit of the Corporation
in one or more of such banks, trust companies or other depositaries as the
Board of Directors may select or as may be selected by any officer or officers
or agent or agents of the Corporation to whom power in that respect shall have
been delegated by the Board of Directors. For the purpose of deposit and for
the purpose of collection for the account of the Corporation, checks, drafts
and other orders for the payment of money which are payable to the order of
the Corporation may be endorsed, assigned and delivered by any officer or
agent of the Corporation to whom such power is so delegated.
Section 5. General and Special Bank Accounts. The Board of
Directors may from time to time authorize the opening and keeping of general
and special bank accounts with one or more of such banks, trust companies or
other depositaries as the Board of Directors may select or as may be selected
by any officer or officers, agent or agents of the Corporation to whom power
in that respect shall have been delegated by the Board of Directors. The
Board of Directors may make such special rules and regulations with respect to
such bank accounts, not inconsistent with the provisions of these By-Laws, as
it may deem expedient.
Section 6. Proxies in Respect of Stock or Other Securities of Other
Corporations. Unless otherwise provided by resolutions adopted by the Board
of Directors, the Chairman of the Board, the President, any Executive Vice
President, any Group Vice President, any Senior Vice President, any Vice
President, the Secretary or the Treasurer of the Corporation, or any one or
more of them shall have full power and authority to exercise in the name and
on behalf of the Corporation all the powers and rights, including the right to
vote and consent, which the Corporation may have as the holder of stock or
other securities in any other corporation, and from time to time to appoint an
attorney or attorneys or an agent or agents, or proxy or proxies with like
power and authority in respect of such stock or other securities, and may
instruct the person or persons so appointed as to the manner of exercising
such powers and rights, and may execute or cause to be executed in the name
and on behalf of the Corporation and under its corporate seal, or otherwise,
all such written proxies or other instruments as he or they may deem necessary
or proper in order that the Corporation may exercise its said powers and
rights. The Board of Directors from time to time may by resolution confer
like powers and authority upon any other person or persons.
ARTICLE VIII
Books and Records
The books and records of the Corporation may be kept outside of the
State of Delaware, at the general office of the Corporation in Dallas, Texas,
or at such other place or places as may be from time to time designated or
selected by the Board of Directors.
ARTICLE IX
Shares and Their Transfer;
Examination of Books
Section 1. Certificates for Stock. Every owner of stock of the
Corporation shall be entitled to have a certificate in such form not
inconsistent with the Certificate of Incorporation as the Board of Directors
shall prescribe, certifying the number and class of shares of stock of the
Corporation owned by him. The certificates representing shares of the
respective classes of such stock (if there be more than one) shall state the
name of the person owning the shares represented thereby, shall be numbered in
the order in which they shall be issued, and shall be signed in the name of
the Corporation by the Chairman of the Board or the President or an Executive
Vice President or a Group Vice President or a Senior Vice President or a Vice
President or by the Treasurer or the Secretary or an Assistant Treasurer or an
Assistant Secretary of the Corporation and its seal shall be affixed thereto;
provided, however, that where such certificate is countersigned by (1) a
transfer agent other than the Corporation or its employee, or (2) a registrar
other than the Corporation or its employee, if the Board of Directors shall by
resolution so authorize, any of the signatures of the foregoing officers of
the Corporation and the seal of the Corporation may be facsimile. In case any
officer of the Corporation, transfer agent or registrar who has signed, or
whose facsimile signature has been placed upon a certificate shall have ceased
to be such officer, transfer agent, or registrar before such certificate is
issued, such certificate may be issued by the Corporation with the same effect
as if he were such officer, transfer agent or registrar at the date of issue.
The name of the person owning the shares represented by each certificate, the
number of shares, and the date of issue shall be entered on the stock ledger
of the Corporation. Every certificate surrendered to the corporation for
exchange or transfer shall be cancelled and a new certificate or certificates
shall not be issued in exchange for any existing certificate, until such
existing certificate shall have been so cancelled, except in cases provided
for in Section 4 of Article IX.
Section 2. Transfers of Stock. Transfers of shares of stock of the
Corporation shall be made only on the books of the Corporation by the
registered holder thereof, or by his attorney thereunto authorized by power of
attorney duly executed and filed with the Secretary of the Corporation, or
with a transfer clerk or a transfer agent appointed as provided in Section 3
of Article IX, and on surrender of the certificate or certificates for such
shares properly endorsed and the payment of all taxes thereon. The person in
whose name shares of stock are registered on the books of the Corporation
shall be deemed and treated as the owner thereof for all purposes; and the
Corporation shall not be bound to recognize any equitable or other claim to or
interest in such share or shares on the part of any other person, whether or
not it shall have express or other notice thereof, save as expressly provided
by the laws of the State of Delaware.
Section 3. Regulations. The Board of Directors may make such rules
and regulations as it may deem expedient, not inconsistent with these By-Laws,
concerning the issue, transfer and registration of certificates for shares of
the stock of the Corporation. It may appoint one or more transfer clerks or
one or more transfer agents and one or more registrars, and may require all
certificates of stock to bear the signature or signatures of any of them.
Section 4. Lost, Destroyed, Stolen, and Mutilated Certificates.
The holder of any stock of the Corporation shall immediately notify the
Corporation of any loss, destruction, theft, or mutilation of the certificate
therefor, and the Corporation may issue a new certificate of stock in the
place of any certificate theretofore issued by it, alleged to have been lost,
destroyed, stolen, or mutilated, upon the surrender of the mutilated
certificate, or in the case of loss, destruction, or theft of the certificate,
upon satisfactory proof of such loss, destruction, or theft. The Board of
Directors may, in its discretion, as a condition precedent to the issuance of
a new certificate, require the owner of the lost, destroyed, or stolen
certificate or his legal representatives to give the Corporation a bond in such
sum, limited or unlimited, and in such form and with such surety or sureties,
as the Board shall in its uncontrolled discretion determine, to indemnify the
Corporation against any claim that may be made against it on account of the
alleged loss, destruction, or theft of any such certificate, or the issuance
of such new certificates.
Section 5. Fixing Record Date. In order that the Corporation may
determine the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, or to express consent to corporate
action in writing without a meeting, or entitled to receive payment of any
dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock
or for the purpose of any other lawful action, the Board of Directors may fix,
in advance, a record date, which shall not be more than sixty nor less than
ten days before the date of such meeting, nor more than sixty days prior to
any other action.
A determination of stockholders of record entitled to notice of or
to vote at a meeting of stockholders shall apply to any adjournment of the
meeting; provided, however, that the Board of Directors may fix a new record
date for the adjourned meeting.
ARTICLE X
Seal
The corporate seal of the Corporation shall be in the form of a
circle and shall bear the full name of the Corporation, the state and year of
incorporation, and the words "Corporate Seal." Said seal may be used by
causing it or a facsimile thereof to be impressed, affixed or otherwise
reproduced. The seal shall be retained by the Secretary. A duplicate of the
seal may be kept and used by the Treasurer, by an Assistant Secretary or
Assistant Treasurer, or by any other employee authorized by resolution of the
Board of Directors.
ARTICLE XI
Fiscal Year
The fiscal year of the Corporation shall begin on the first day of
January and end on the thirty-first day of December in each year.
ARTICLE XII
Notices and Waivers Thereof
Whenever under the provisions of the law of the State of Delaware,
of the Certificate of Incorporation, or these By-Laws notice of any nature is
required to be given to any director, officer or stockholder, unless otherwise
provided by law or expressly provided by these By-Laws, such notice may be
given personally, or it may be given in writing by depositing the same in the
post office or a letter box maintained and kept by the United States
Government in a postpaid sealed envelope addressed to such director, officer
or stockholder at such address as appears upon the books of the Corporation,
or, in default of other address, to such director, officer or stockholder at
the general post office in the City of Wilmington, Delaware, and such notice
shall be deemed to be given at the time when the same shall be thus mailed; a
waiver of such notice in writing signed by the person or persons entitled to
such notice, or a telegram, cable or wireless sent by such person, whether
before or after the time stated therein shall be deemed equivalent to notice.
Attendance of a person at a meeting of stockholders shall constitute a waiver
of notice of such meeting, except when the stockholder attends a meeting for
the express purpose of objecting, at the beginning of the meeting, to the
transaction of any business because the meeting is not lawfully called or
convened. Neither the business to be transacted at, nor the purpose of, any
regular or special meeting of the stockholders need be specified in any
written waiver of notice.
ARTICLE XIII
Annual Financial Statement
The Board of Directors shall cause to be published and submitted to
the stockholders, at least fifteen days in advance of their annual meeting,
the Corporation's annual financial statement covering the previous fiscal
year, and containing such other information and data as the Board of Directors
may deem appropriate.
ARTICLE XIV
Amendments
These By-Laws, as they shall be at any time and whether or not
previously altered, amended or added to, may be made, altered, amended or
repealed from time to time by the Board of Directors by the affirmative vote
of a majority of the authorized number of directors at any regular or special
meeting of directors if notice of the proposed change was contained in the
notice of such meeting. The stockholders also, by the affirmative vote of a
majority of the stock issued, outstanding and entitled to vote may from time
to time make, alter, amend or repeal the By-Laws at any regular or special
meeting if notice of the proposed change was contained in the notice of the
meeting; and any addition, alteration, amendment or repeal effected by the
Board of Directors may be altered, amended or repealed by the stockholders in
the manner hereinabove set forth.
Exhibit 10(a)(i)
----------------
Amended and Restated
TI DEFERRED COMPENSATION PLAN
(Effective January 1, 1998)
Table of Contents
ARTICLE I
DEFINITIONS AND CONSTRUCTION. . . . . . . . . . . . . . . . . . . . 2
Sec. 1-1. Accounts . . . . . . . . . . . . . . . . . . . . . 2
Sec. 1-2. Administrator . . . . . . . . . . . . . . . . . . . 2
Sec. 1-3. Beneficiary . . . . . . . . . . . . . . . . . . . . 2
Sec. 1-4. Benefit Restoration Account . . . . . . . . . . . . 2
Sec. 1-5. Benefit Restoration Only Participant . . . . . . . 3
Sec. 1-6. Board of Directors. . . . . . . . . . . . . . . . . 3
Sec. 1-8. Code . . . . . . . . . . . . . . . . . . . . . . . 3
Sec. 1-9. Compensation. . . . . . . . . . . . . . . . . . . . 3
Sec. 1-10. Compensation Committee . . . . . . . . . . . . . . 3
Sec. 1-11. Deferred Compensation Agreement. . . . . . . . . . 3
Sec. 1-12. Deferred Compensation Account. . . . . . . . . . . 4
Sec. 1-13. Designated Employee. . . . . . . . . . . . . . . . 4
Sec. 1-14. Election Period. . . . . . . . . . . . . . . . . . 4
Sec. 1-15. Employee . . . . . . . . . . . . . . . . . . . . . 4
Sec. 1-16. Employer . . . . . . . . . . . . . . . . . . . . . 4
Sec. 1-17. ERISA. . . . . . . . . . . . . . . . . . . . . . . 4
Sec. 1-18. Incentive Compensation . . . . . . . . . . . . . . 4
Sec. 1-19. Participant. . . . . . . . . . . . . . . . . . . . 4
Sec. 1-20. Plan Year. . . . . . . . . . . . . . . . . . . . . 5
Sec. 1-21. Subsidiary . . . . . . . . . . . . . . . . . . . . 5
Sec. 1-22. Termination of Employment. . . . . . . . . . . . . 5
Sec. 1-23. Universal Plan . . . . . . . . . . . . . . . . . . 5
Sec. 1-24. U.S. Retirement Plan . . . . . . . . . . . . . . . 5
Sec. 1-25. Construction . . . . . . . . . . . . . . . . . . . 5
ARTICLE II . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
ELIGIBILITY AND PARTICIPATION . . . . . . . . . . . . . . . . . . . 6
Sec. 2-1. Eligibility . . . . . . . . . . . . . . . . . . . . 6
Sec. 2-2. Participation in a Deferred Compensation Account . 6
Sec. 2-3. Participation in a Benefit Restoration Account for
Participants in the U.S. Retirement Plan. . . . . . . . . . . 6
Sec. 2-4. Participation in a Benefit Restoration Account for
Participants in the Universal Plan. . . . . . . . . . . . . . 7
ARTICLE III. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
PARTICIPANT ACCOUNTS. . . . . . . . . . . . . . . . . . . . . . . . .7
Sec. 3-1. Participant Accounts . . . . . . . . . . . . . . . .7
Sec. 3-2. Elections by Participants for a Deferred
Compensation Account. . . . . . . . . . . . . . . . . . . . . .8
Sec. 3-3. Benefit Restoration Accounts . . . . . . . . . . . .8
Sec. 3-4. Investment Performance of Contributions. . . . . . .9
Sec. 3-5. Withdrawal of Contributions. . . . . . . . . . . . .9
Sec. 3-6. Election for Distribution of Participant Accounts. 10
Sec. 3-7. Distribution of Participant Accounts . . . . . . . 10
Sec. 3-8. Time of Distribution . . . . . . . . . . . . . . . 11
Sec. 3-9. Taxes. . . . . . . . . . . . . . . . . . . . . . . 12
Sec. 3-10. Assignment. . . . . . . . . . . . . . . . . . . . 12
Sec. 3-11. Spousal Claims. . . . . . . . . . . . . . . . . . 12
Sec. 3-12. Payment in the Event of Legal Disability. . . . . 12
ARTICLE IV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
FUNDING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Sec. 4-1. Funding. . . . . . . . . . . . . . . . . . . . . . 13
Sec. 4-2. Creditor Status .. . . . . . . . . . . . . . . . . 13
ARTICLE V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
ADMINISTRATION OF THE PLAN. . . . . . . . . . . . . . . . . . . . . 13
Sec. 5-1. Administration . . . . . . . . . . . . . . . . . . 13
Sec. 5-2. Number and Selection . . . . . . . . . . . . . . . 13
Sec. 5-3. Action by Administrator. . . . . . . . . . . . . . 13
Sec. 5-4. Accounts of Participants . . . . . . . . . . . . . 14
Sec. 5-5. Rules and Regulations. . . . . . . . . . . . . . . 14
Sec. 5-6. Reliance on Documents. . . . . . . . . . . . . . . 14
Sec. 5-7. Non-Liability . . . . . . . . . . . . . . . . . . .14
Sec. 5-8. Resignation or Removal . . . . . . . . . . . . . . 14
Sec. 5.9. Information: Overpayment or Underpayment of
Benefits. . . . . . . . . . . . . . . . . . . . . . . . . . . 14
ARTICLE VI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
GENERAL PROVISIONS. . . . . . . . . . . . . . . . . . . . . . . . . 15
Sec. 6-1. Amendment, Termination . . . . . . . . . . . . . . 15
Sec. 6-2. Plan Not an Employment Contract. . . . . . . . . . 15
Sec. 6-3. Rights of Persons Making Claims. . . . . . . . . . 15
Sec. 6-4. Status of Benefits in this Plan. . . . . . . . . . 15
TI DEFERRED COMPENSATION PLAN
TEXAS INSTRUMENTS INCORPORATED, a Delaware corporation with its principal
offices in Dallas, Texas (hereinafter referred to as "TI" or "the Company"),
does hereby amend, restate, and continue the TI Deferred Compensation Plan
(hereinafter referred to as the "Plan").
TI adopted the TI Supplemental Pension and Profit Sharing Benefit Plan
effective as of September 8, 1978, and the TI Supplemental Pension and Profit
Sharing Benefit Plan II as of January 1, 1993. Both such plans were amended
from time to time. These supplemental plans supplemented pension benefits
provided under the TI Employees Pension Plan and defined contribution plan
benefits provided under the TI Employees Universal Profit Sharing Plan. The
provisions of such supplemental plans relevant to, and supplementing pension
benefits under, the TI Employees Pension Plan were amended, restated and
merged into the TI Employees Supplemental Pension Plan, effective January 1,
1998. The supplemental pension plan obligations accrued under the two prior
such supplemental plans will be provided on and after January 1, 1998, under
the TI Employees Supplemental Pension Plan.
The provisions of the two prior supplemental plans relevant to, and
supplementing benefits under, the TI Employees Universal Profit Sharing Plan,
and effective January 1, 1998, the TI Employees Retirement and Profit Sharing
Plan, are hereby amended, restated and merged into this Plan, the TI Deferred
Compensation Plan, effective January 1, 1998.
Following January 1, 1998, the TI Supplemental Pension and Profit Sharing
Benefit Plan and the TI Supplemental Pension and Profit Sharing Plan II, as
amended from time to time, shall not apply to any Employee of any Employer who
has not yet commenced receipt of benefits under such supplemental plans prior
to January 1, 1998. The benefits of Employees or Beneficiaries in pay status
prior to January 1, 1998, under such supplemental plans shall continue to be
determined under the provisions of the prior supplemental plans, as
applicable, and not under this Plan.
This Plan as so amended and restated shall be effective as of January 1,
1998.
The purposes of the Plan are:
(i) to provide to a select group of management and highly compensated
employees, as described in section 201(2) of the Employee
Retirement Income Security Act of 1974 ("ERISA"), the opportunity
to defer to a later date payment of certain compensation which
they may earn; and
(ii) to restore certain benefits which cannot be provided under the
TI Employees Universal Profit Sharing Plan or the TI U.S. Employees
Retirement and Profit Sharing Plan as a result of that deferral of
compensation or by reason of the application of section 401(a)(17)
and/or section 415 of the Internal Revenue Code of 1986, as
amended (the "Code").
ARTICLE I
DEFINITIONS AND CONSTRUCTION
Whenever used in this Plan, the following words and phrases shall have
the meanings set forth below, unless a different meaning is plainly required
by the context. Unless otherwise indicated by the context, any masculine
terminology when used in the Plan shall also include the feminine gender, and
the definition of any term in the singular shall also include the plural.
Sec. 1-1. Accounts. "Accounts" means both the Benefit Restoration
Account and the Deferred Compensation Account of a Participant.
Sec. 1-2. Administrator "Administrator" means the person or persons
from time to time acting under the provisions of Article V hereof.
Sec. 1-3. Beneficiary. "Beneficiary" means the person or persons named
by a Participant who is not married as his or her Beneficiary, co-Beneficiary,
or contingent Beneficiary. "Beneficiary" means, in the case of a married
Participant, the spouse of the Participant to whom the Participant was married
at the time of his or her death, provided that a married Participant shall be
entitled to designate one or more Beneficiaries or contingent Beneficiaries
other than the Participant's spouse to receive any amount payable under the
Plan in the event of his or her death and from time to time to change such
designation. Such designation of a non-spousal Beneficiary shall not be
effective unless:
(i) the spouse of the Participant consents in writing to such
designation and the spouse's consent acknowledges the effect of
such designation and is witnessed by a Plan representative or a
notary public; or
(ii) the Participant establishes to the satisfaction of the
Administrator that such spouse's consent may not be obtained
because the spouse cannot be located.
Any consent by a spouse (or the establishment that consent of a spouse may not
be obtained) shall be effective only with respect to that spouse. Such spouse
may revoke his or her consent by filing prior to the Termination of Employment
of the Participant a revocation in such form and manner as the Administrator
shall specify. The Administrator may rely on the representations by the
Participant as to whether the Participant has no spouse or the spouse cannot
be located and shall have no liability for such reliance. All Beneficiary
designations and changes of Beneficiary Designations shall be made in
accordance with such rules and regulations, as the Administrator shall
prescribe.
A person who is an alternate payee under a qualified domestic relations
order may be considered a Beneficiary for purposes of this Plan.
Sec. 1-4. Benefit Restoration Account "Benefit Restoration Account"
means the bookkeeping account of a Participant maintained by TI which reflects
contributions and earnings posted pursuant to Section 3-4 hereof.
Sec. 1-5. Benefit Restoration Only Participant. "Benefit Restoration
Only Participant" means a Participant for whom a Benefit Restoration Account
is maintained but who is not a Designated Employee.
Sec. 1-6. Board of Directors. "Board of Directors" means the Board of
Directors of TI or of any Subsidiary which has adopted this Plan.
Sec. 1-7. Change in Control. . "Change in Control" means an event which
shall be deemed to have occurred when:
(i) any Person, alone or together with its Affiliates and Associates or
otherwise, shall become an Acquiring Person (otherwise than
pursuant to a transaction or agreement approved by the Board of
Directors prior to the time the Acquiring Person became such); or
(ii) a majority of the Board of Directors of the Company shall change
within any 24-month period, unless the election or the nomination
for election by the Company's stockholders of each new director has
been approved by a vote of at least a majority of the directors
then still in office who were directors at the beginning of the
Period. For the purposes hereof, the terms "Persons", "Affiliates",
"Associates", "Acquiring Person" and "Period" shall have the
meanings given to such terms in the Rights Agreement dated as of
June 17, 1988, between the Company and Harris Trust and Savings
Bank, successor in interest to First Chicago Trust Company of New
York (formerly Morgan Shareholder Services Trust Company), as in
effect on the date hereof, provided, however, that if the
percentage employed in the definition of Acquiring Person is
reduced hereafter from 20% in such Rights Agreement or any
successor Rights Agreement, then such reduction shall also be
applicable for the purposes hereof.
Sec. 1-8. Code. "Code" means the Internal Revenue Code of 1986, as
amended.
Sec. 1-9. Compensation. "Compensation" for a Participant who is a
participant in the Universal Plan shall have the same meaning as in the
Universal Plan. "Compensation" for a Participant who is also a participant in
the U.S. Retirement Plan shall have the same meaning as in the U.S. Retirement
Plan. Additionally, "Compensation" for purposes of this Plan shall include:
(i) all Compensation or Incentive Compensation deferred pursuant to
Section 3-2 hereof; and
(ii) all Compensation that was excluded from consideration under the
Universal Plan or the U.S. Retirement Plan because of the
limitations under section 401(a)(17) and/or section 415 of the Code.
Sec. 1-10. Compensation Committee. "Compensation Committee" means the
Compensation Committee of the Board of Directors of TI.
Sec. 1-11. Deferred Compensation Agreement. "Deferred Compensation
Agreement" means an agreement pursuant to which a Designated Employee elects
to defer part of his or her Compensation and which specifies:
(i) that the Designated Employee agrees to participate in this Plan in
accordance with its provisions; and
(ii) that this Plan is incorporated by reference and the Deferred
Compensation Agreement shall be subject to this Plan in all
respects.
Sec. 1-12. Deferred Compensation Account. "Deferred Compensation
Account" means the bookkeeping account of a Participant maintained by TI,
which reflects contributions and earnings posted pursuant to Section 3-2
hereof.
Sec. 1-13. Designated Employee. "Designated Employee" means an employee
of TI or a Subsidiary who is designated by the Compensation Committee as
eligible to defer compensation pursuant to this Plan during a Plan Year.
Sec. 1-14. Election Period. "Election Period" means the period
specified by the Administrator at least once during a Plan Year during which
Participants may enter into or amend existing Deferred Compensation Agreements.
All elections made during the Election Period shall be subject to the
provisions of this Plan.
Sec. 1-15. Employee. "Employee" means any employee of TI or its
subsidiaries, whether full or part-time.
Sec. 1-16. Employer. "Employer" means Texas Instruments Incorporated and
any other corporation and any other member of the controlled group of
corporations (as defined in section 414(b) of the Code) which includes TI and
which adopts the Universal Plan or the U.S. Retirement Plan, unless the
controlled group member's adopting resolutions specifically provide that while
adopting the Universal Plan or the U.S. Retirement Plan, it is not adopting
this Plan. In any event, among the Employers, TI shall have sole power to
amend or terminate this Plan.
Sec. 1-17. ERISA. "ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as amended.
Sec. 1-18. Incentive Compensation. "Incentive Compensation" means a
Participant's cash incentive award under the Texas Instruments' Executive
Officer Performance Plan and Annual Performance Bonus Plan, as amended from
time to time, and any successor to those plans.
Sec. 1-19. Participant. "Participant" means both an Active Participant
and an Inactive Participant, as such terms are defined in this Section 1-19.
(i) "Active Participant" means an Employee who participates in this
Plan in accordance with Article II hereof and who is not an
"Inactive Participant" as defined in (ii) below.
(ii) "Inactive Participant" shall include:
(a) with respect to the Deferred Compensation Account, a Designated
Employee who has a Deferred Compensation Account balance but
who did not execute a Deferred Compensation Agreement for the
current Plan Year in accordance with Article III hereof, and
(b) an Employee who has either a Deferred Compensation Account
balance, but who is no longer a Designated Employee, or
(c) a former Employee who has a Deferred Compensation Account
balance and/or a Benefit Restoration Account balance and who
has had a Termination of Employment.
Sec. 1-20. Plan Year. "Plan Year" means a calendar year.
Sec. 1-21. Subsidiary. "Subsidiary" means any entity whose assets and
net income are included in the consolidated financial statements of TI and its
subsidiaries audited by TI's independent auditors and reported to shareholders
in the published annual report to shareholders.
Sec. 1-22. Termination of Employment. "Termination of Employment" means
the complete cessation of the employer-employee relationship between TI or any
Subsidiary and a Participant, including a leave of absence from which the
Administrator, in its sole discretion, determines that the Participant is not
expected to return.
Sec. 1-23. Universal Plan. "Universal Plan" means the TI Employees
Universal Profit Sharing Plan.
Sec. 1-24. U.S. Retirement Plan. "U.S. Retirement Plan" means the TI
U.S. Employees Retirement and Profit Sharing Plan.
Sec. 1-25. Construction. This Plan is not intended to constitute a
"qualified plan" subject to the limitations of section 401(a) of the Code, nor
shall it constitute a "funded plan", for purposes of such requirements. It is
intended that this Plan shall be exempt from the participation and vesting
requirements of Part 2 of Title I of ERISA, the funding requirements of Part 3
of Title I of ERISA and the fiduciary requirements of Part 4 of Title I of
ERISA by reason of the exclusions afforded plans which are unfunded and
maintained by an employer primarily for the purpose of providing deferred
compensation for a select group of management or highly compensated employees.
If any provision of this Plan is determined to be for any reason invalid or
unforceable, the remaining provisions of this plan shall continue in full
force and effect. This Plan shall be governing construed in accordance with
the laws of the State of Texas, except to the extent otherwise required by
applicable federal law. Heading and subheadings are for the purpose of
reference only and are not to be considered in the construction of this Plan.
Where this Plan supplements benefits under the Universal Plan and the U.S.
Retirement Plan, this Plan is functionally and operationally related to such
plans, and is to be interpreted in a manner consistent with the Universal Plan
and the U.S. Retirement Plan to provide the benefits contemplated hereunder in
a comprehensive manner.
ARTICLE II
ELIGIBILITY AND PARTICIPATION
Sec. 2-1. Eligibility. A Designated Employee as of October 31 of the
immediately preceding Plan Year, and such other Employees as the Compensation
Committee may designate as Designated Employees from time to time, shall be
eligible to participate in:
(i) a Deferred Compensation Account during such Plan Year in accordance
with the provisions of Section 2-2 below, and/or
(ii) a Benefit Restoration Account in accordance with the provisions of
Section 2-3 or Section 2-4 below.
Any Employee who receives a credit pursuant to Section 2-3 or Section 2-4
shall be a Participant, but will be a Benefit Restoration Only Participant
unless the Employee is also a Designated Employee. The participation of a
Benefit Restoration Only Participant, and the participation of a Designated
Employee who is subject to Section 2-3 or Section 2-4 shall be automatic. The
participation of a Designated Employee in a Deferred Compensation Account is
elective, as described below.
Sec. 2-2. Participation in a Deferred Compensation Account. A
Designated Employee shall become a Participant in a Deferred Compensation
Account by completing a Deferred Compensation Agreement in the manner and form
(including without limitation, telephonic and electronic transmission,
utilization of voice response systems and computer entry) specified by the
Administrator or by electing to defer Compensation as provided in Section 3-2
below.
Sec. 2-3. Participation in a Benefit Restoration Account for
Participants in the U.S. Retirement Plan.
(i) An Employee will become a Participant in this Plan, and a Benefit
Restoration Account in the name of the Participant will be credited
with contributions not credited to such Participant's "Contribution"
or "Profit Sharing" accounts under the U.S. Retirement Plan for that
Plan Year as of the date the limitations under section 401(a)(17)
and/or section 415 of the Code are first applicable, so that
allocations under the U.S. Retirement Plan allocable to such
accounts of such Participant are restricted.
(ii) An Employee will become a Participant in this Plan, and a Benefit
Restoration Account in the name of such Participant will be
credited with "Employer 401(m) Contributions" not credited to the
Participant's "401(k) Account" under the U.S. Retirement Plan for
that Plan Year as of the date the limitations under section
401(a)(17) and/or section 415 of the Code first restrict
contributions or allocations under the U.S. Retirement Plan;
provided that the Participant has made an election under the U.S.
Retirement Plan to defer the maximum amount of compensation
permitted under section 402(g) of the Code.
(iii) A Designated Employee will become a Participant in this Plan and a
Benefit Restoration Account in the name of the Designated Employee
Participant will be credited with contributions not credited to the
Participant's "Contribution Account", "Profit Sharing Account", and
with "Employer 401(m) Contributions" not credited to the Designated
Employee Participant's "401(k) Account" under the U.S. Retirement
Plan for that Plan Year because the Designated Employee Participant
deferred compensation under this Plan, as of date deferred
Compensation or deferred Incentive Compensation is credited to the
Participant's Deferred Compensation Account pursuant to Section 3-2
below; provided that no "Employer 401(m) Contributions" restoration
shall be made unless the Participant has made an election under the
U.S. Retirement Plan to defer the maximum amount of compensation
permitted under section 402(g) of the Code.
Sec. 2-4. Participation in a Benefit Restoration Account for
Participants in the Universal Plan.
(i) An Employee will become a Participant in this Plan and a Benefit
Restoration Account in the name of such Participant will be credited
with contributions not credited to the Participant's "Universal
Profit Sharing Account" under the Universal Plan for that Plan Year,
as of the date the limitations under section 401(a)(17) and/or
section 415 of the Code are first applicable, so that allocations
under the Universal Plan to the "Universal Profit Sharing Account"
under the Universal Plan of such Participant are restricted.
(ii) Designated Employee will become a Participant in this Plan, and a
Benefit Restoration Account in the name of such Participant will be
credited with "Employer Matched Savings Contributions" not credited
to the Designated Employee Participant's "Cash or Deferred Account"
under the Universal Plan for that Plan Year because the Designated
Employee Participant deferred compensation under this Plan, as of
the date the Compensation or Incentive Compensation is credited to
the Participant's Deferred Compensation Account pursuant to Section
3-2 below; provided that the Participant has made an election under
the Universal Plan to defer the maximum amount of compensation
permitted under section 402(g) of the Code. Notwithstanding
anything in this Section 2-4 to the contrary, no contributions shall
be credited under this Plan on account of "Employer Matched Savings
Contributions" that cannot be credited to the Participant's "Cash or
Deferred Account" under the Universal Plan by reason of section 415
of the Code.
(iii) A Designated Employee will become a Participant in this Plan and a
Benefit Restoration Account in the name of such Participant will be
credited with contributions not credited to the Participant's
"Universal Profit Sharing Account" under the Universal Plan for that
Plan Year because the Designated Employee Participant deferred
compensation under this Plan, as of the date the Compensation or
Incentive Compensation is credited to the Participant's Deferred
Compensation Account pursuant to Section 3-2 below.
Article III
PARTICIPANT ACCOUNTS
Sec. 3-1. Participant Accounts. TI shall maintain for each Participant
an unfunded bookkeeping Deferred Compensation Account and/or Benefit
Restoration Account to which shall be credited or debited all contributions
and any earnings and losses that would have been incurred thereon if the
Accounts had been invested as directed by the Participant pursuant to this
Article III. Except as provided in Section 3-5, a Participant shall at all
time have a fully vested and nonforfeitable right to the amounts credited to
his or her Deferred Compensation Account under this Plan, and to the extent
the Participant is vested in corresponding benefits under the Universal Plan
or the U.S. Retirement Plan, the Participant shall be vested in the amounts
credited to his or her Benefit Restoration Account, subject to the
distribution provisions and other requirements of this Plan.
Sec. 3-2. Elections by Participants for a Deferred Compensation Account.
(i) A Designated Employee who elects to participate in a Deferred
Compensation Account may, during the Election Period, elect to defer
into a Deferred Compensation Account no more than 90% of the
Designated Employee's Incentive Compensation for the next Plan Year.
A Participant's election to defer Incentive Compensation during any
succeeding Plan Year is irrevocable and shall become effective as of
the first month of the Plan Year immediately following such Election
Period.
(ii) A Designated Employee who elects to participate in a Deferred
Compensation Account may, at any time, elect to defer into a
Deferred Compensation Account no more than 10% of the Designated
Employee's Compensation (exclusive of Incentive Compensation) during
a Plan Year. An election for deferral of Compensation other than
Incentive Compensation shall become effective on the later to occur
of:
(a) the pay period immediately following the pay period in which
the election was made; and
(b) the date the Participant has deferred the maximum amount
permitted under section 402(g) of the Code into the
Participant's "Cash or Deferred Account" under the Universal
Plan or "401(k) account" under the U.S. Retirement Plan, as
applicable.
The Employer of a Designated Employee Participant shall credit to the
Designated Employee Participant's Deferred Compensation Account the amount of
Compensation (exclusive of Incentive Compensation) and/or Incentive
Compensation the Participant has elected to defer. Such amount shall be
credited as of the date the compensation deferred would otherwise have been
paid to the Participant in the absence of the Participant's deferral election.
Sec. 3-3. Benefit Restoration Accounts. The Employer of a Participant
shall credit to the Benefit Restoration Account of such Participant all of the
following that apply:
(i) the amount of any "Employer 401(m) Contributions" which would have
been made but which were not made under the U.S. Retirement Plan
because either the provisions of section 401(a)(17) and/or section
415 of the Code applied to restrict contributions or the Participant
deferred compensation pursuant to Section 3-2 above, provided that
such contribution, when added to any 401(m) contribution actually
made pursuant to the U.S. Retirement Plan, does not exceed 4% of the
amount of Compensation received by such Participant during the Plan
Year.
(ii) the amount of any contributions to the Participant's "Contribution
Account" or "Profit Sharing Account" under the U.S. Retirement Plan,
which were not made to the U.S. Retirement Plan because of the
application of section 401(a)(17) and/or section 415 of the Code or
because the Participant deferred compensation pursuant to Section 3-2
above;
(iii) the amount of any "Matched Savings Contribution" under the Universal
Plan which would have been credited but which was not credited under
the Universal Plan solely because the Designated Employee deferred
compensation pursuant to Section 3-2 above, provided that such
contribution, when added to any "Matched Savings Contribution"
actually made pursuant to the Universal Plan, does not exceed 2% of
such Designated Employee's Compensation during the Plan Year; and
(iv) the amount of any contributions to the Participant's "Profit Sharing
Account" under the Universal Plan which were not credited to the
Universal Plan because of the application of section 401(a)(17)
and/or section 415 of the Code or because the Participant deferred
compensation pursuant to Section 3-2 above.
Sec. 3-4. Investment Performance of Contributions. As soon as the
Administrator determines that it is administratively feasible, a Participant
may direct the Administrator to value amounts deferred pursuant to Section 3-2
above or restored pursuant to Section 3-3 above so as to reflect the
performance of any of the participant investment funds authorized under the
U.S. Retirement Plan. Separate directions may be made with respect to amount
already credited to a Participant's accounts and with respect to amounts to be
credited in the future.
Participant investment performance directions may be made not more often
than once each day. Each such direction which conforms to the terms and
conditions specified by the Administrator shall be effective as soon as
practicable after it is made and shall continue in effect until revoked or
modified by a new direction.
If a Participant has made no investment performance direction pursuant to
this Section 3-4 then the Participant's Accounts shall be valued as follows:
(i) any Deferred Compensation Account of such Participant established
pursuant to Section 3-2 shall reflect the performance of the "Income
Fund" under the U.S. Retirement Plan;
(ii) the portion of the Benefit Restoration Account established pursuant
to Section 3-3 (ii) or (iv) above, for "Profit Sharing Contributions"
not made to the U.S. Retirement Plan or Universal Plan, shall reflect
the performance of "TI Stock Fund" under the U.S. Retirement Plan;
and
(iii) the remainder of the Benefit Restoration Account established pursuant
to Section 3-1 above shall be valued to reflect the Participant's
investment performance direction, if any, for his or her Deferred
Compensation Account. If no performance election was made under the
Deferred Compensation Account, or the Participant is a Benefit
Restoration Account Only Participant, the remainder of the Benefit
Restoration Account shall reflect the investment performance of the
"Income Fund" under the U.S. Retirement Plan.
Sec. 3-5. Withdrawal of Contributions. During a Plan Year, a
Participant may withdraw funds credited to the Participant's Deferred
Compensation Account, not to exceed 100% of the Participant's Deferred
Contribution Account balance on December 31 of the immediately preceding Plan
Year. A Participant who makes such an election shall forfeit 10% of the amount
withdrawn and the Participant's Deferred Contribution Account shall be adjusted
to reflect such forfeiture. Withdrawals shall be made as soon as practicable
after the Administrator receives a request for a withdrawal of funds. A
Participant may not withdraw funds credited to the Benefit Restoration Account
until after the date of the Participant's Termination of Employment, in which
event distribution shall be made pursuant to Section 3-6.
Sec. 3-6. Election for Distribution of Participant Accounts.
(i) At the earlier of the time a Designated Employee Participant first
elects to defer Incentive Compensation or Compensation other than
Incentive Compensation, or when any Participant is credited with an
allocation to the Participant's Benefit Restoration Account, the
Participant shall elect the form of distribution to be made from the
Participant's Accounts. Such election shall be made in such manner
and form (including without limitation, telephonic and electronic
transmission, utilization of voice response systems and computer
entry) as specified by the Administrator, subject to Section 3-6(ii)
and (iii) below. Such election shall remain in effect until a
subsequent distribution election becomes effective.
(ii) An election of form of payment of distribution of an Account may be
revoked and a new election substituted therefor only during the
Enrollment Period. Any substituted election shall not become
effective until 12 months after the date of such election.
(iii) Participants may elect to receive distribution of their Accounts in
the following forms, subject to Section 3-7 and Section 3-8:
(a) a lump sum payable within 5 years from the date distribution
could first be made under this Section 3-6;
(b) annual installments to be paid over any period of 5 years;
provided that the Accounts must be fully distributed within 10
years from the date the first distribution could have been made
pursuant to this Section 3-6; or
(c) annual installments to be paid over 10 years; provided that
the Accounts must be fully distributed within 15 years from
the date the first distribution could have been made
pursuant to this Section 3-6.
If no election for distribution of a Deferred Compensation Account or
Benefit Restoration Account has been made, such account shall be distributed in
a lump sum as soon as administratively practicable, subject to Section 3-7.
Sec. 3-7. Distribution of Participant Accounts.
(i) TI shall maintain each Participant's bookkeeping Deferred
Compensation Account and/or Benefit Restoration Account until
distributed, subject to Section 6-1(ii) and to the following:
(a) if the cumulative amount credited to the Participant's Accounts
at the Participant's Termination of Employment is less than
$25,000.00, the Participant's Accounts shall be distributed in a
lump sum as soon as practicable; or
(b) if the cumulative amount credited to the Participant's Accounts
at the Participant's Termination of Employment is greater than
$25,000, the Participant's Accounts shall be distributed to the
Participant in the manner elected by the Participant pursuant to
Section 3-6 hereof.
(ii) The Administrator, in its sole and absolute discretion, may require
that a lump sum distribution of any amounts remaining credited to a
Participant's Accounts be made to any Participant following such
Participant's Termination of Employment if the Participant thereafter
becomes affiliated with a governmental agency or with any private
company or firm which the Administrator believes, in its sole and
absolute direction, to be in competition with TI.
(iii) In the event of a Change of Control, distribution of the Accounts of
all Participants shall be made in a lump sum no later than the month
following the month during which such Change of Control occurred, and
accounts shall reflect this distribution, as provided in Section
3-7(v) below. The Plan shall thereafter continue to be administered,
following the Change of Control, in accordance with its terms as
though the Change of Control had not occurred (provided that Accounts
shall be adjusted to reflect the distribution).
(iv) Notwithstanding the foregoing, in the event of the death of a
Participant prior to the receipt of the full amount to be
distributed, one-half of the then balance credited to the
Participant's Accounts will be distributed as soon as practicable
following the month in which the death occurred. Such distribution
shall be made to the Beneficiary or Beneficiaries designated by the
Participant, or if there is no Beneficiary designation under this
Plan, to the Participant's beneficiary under the Universal Plan or
U.S. Retirement Plan, as applicable. If no beneficiary was
designated under either of those plans, distribution will be made to
the Participant's estate. Any amounts which were not distributed in
the year of the Participant's death or which were credited to the
Participant's Accounts during the Plan Year in which the
Participant's death occurs shall be distributed as soon as
practicable after March 16 of the following Plan Year, with the exact
date of distribution to be determined by the Administrator, in its
sole and absolute discretion.
(v) Accounts shall be adjusted to reflect all distributions.
Sec. 3-8. Time of Distribution
(i) Except as otherwise elected by the Participant, distributions shall
commence on or before the last day of the month immediately following
the month in which the Participant's Termination of Employment
occurs, except as provided below:
(a) Amounts deferred pursuant to Section 3-2 for the Plan Year prior
to the Plan Year in which the Participant's Termination of
Employment occurs shall not be distributed before March 16 of
the current Plan Year.
(b) Amounts deferred pursuant to Section 3-2 for the Plan Year
during which a Participant's Termination of Employment occurs
shall not be distributed before March 16 of the Plan Year
immediately following the Plan Year in which the Participant's
Termination of Employment occurs.
(ii) Distributions to be paid in a Plan Year following a Participant's
Termination of Employment shall be paid after March 15 and before
April 1 of that Plan Year.
(iii) The amount of the distribution pursuant to paragraph (i) above for
the Plan Year in which the Participant's Termination of Employment
occurs, shall not, when combined with such Participant's other
remuneration by TI for such Plan Year, exceed the amount that would
be deductible by TI for Federal income tax purposes by reason of
section 162(m) of the Code. Any amount not distributed pursuant to
this paragraph (iii) shall be distributed in March of the Plan Year
immediately following, subject to the same limitation,
Sec. 3-9. Taxes. TI makes no guarantees and assumes no obligation or
responsibility with respect to a Participant's Federal, state, or local income,
estate, inheritance or gift tax obligations, if any, under this Plan or any
Deferred Compensation Agreement. Any taxes required to be withheld from
payments to payee under this Plan shall be deducted and withheld by the
Company, benefit provider or funding agent appointed under the Plan.
Sec. 3-10. Assignment. Except as provided in Section 3-11 below, no
Participant or Beneficiary of a Participant shall have any right to assign,
pledge, hypothecate, anticipate or in any way create a lien on any amounts
payable hereunder. No amounts payable hereunder shall be subject to assignment
or transfer or otherwise be alienable, either by voluntary or involuntary act,
or by operation of law, or subject to attachment, execution, garnishment,
sequestration or other seizure under any legal, equitable or other process, or
be liable in any way for the debts or defaults of Participants and their
Beneficiaries.
Sec. 3-11. Spousal Claims. Any claim against any benefits hereunder for
child support, spousal maintenance or alimony shall be treated in the same
manner as would a claim for corresponding benefits under the U.S. Retirement
Plan or the Universal Plan and shall be subject to all claims provisions and
restriction of those plans. The Administrator may delegate the administration
of spousal claims to the Profit Sharing Administration Committee under the U.S.
Retirement Plan and the Universal Plan.
Sec. 3-12. Payment in the Event of Legal Disability. If a Participant or
Beneficiary entitled to distribution from the Plan is under a legal disability,
or in the sole judgment of the Administrator is unable to apply such
distribution to his or her own interest and advantage, the Administrator may
direct the Plan to make such payment, to be expended for his or her benefit in
any one or more of the following ways:
(i) directly to such person;
(ii) such person's legal guardian or conservator; or
(iii) to such person's spouse or to any person charged with his or her
support.
The decision of the Administrator shall in each case be final and binding
upon all persons in interest. Any such payment shall completely discharge the
obligation of the Administrator, TI and the Plan with respect to such payment.
ARTICLE IV
FUNDING
Sec. 4-1. Funding Benefits under this Plan shall be funded solely by
the Employers. Benefits payable under this Plan shall be paid from the general
assets of the Employers and this Plan shall constitute the Employers' unfunded
and unsecured promise to pay such benefits. Notwithstanding the foregoing, TI
may create reserves, funds, and provide for amounts to be held in trust on
behalf of the Employers under such trust agreements or custodial arrangements
as the Compensation Committee in its absolute and sole discretion deems
appropriate.
Sec. 4-2. Creditor Status. A Participant and his or her Beneficiary or
Beneficiaries shall be general creditors of the Employers with respect to the
payment of any benefit under this Plan.
ARTICLE V
ADMINISTRATION OF THE PLAN
Sec. 5-1. Administration. The Administrator shall be charged with the
administration of the Plan and shall have the power and authority as may be
necessary and appropriate for such purposes, including (but not by way of
limitation), the defense of lawsuits and conduct of litigation in the name of
the Plan (subject to the approval of the General Counsel of TI), the full power
and discretion to interpret and construe this Plan where it concerns question
of eligibility or status, and subject to the opportunity for review of denied
claims pursuant to Section 5-5 below, rights of Participants and others
hereunder, and in general decide any dispute arising under this Plan. In all
such cases the determination of the Administrator shall be final, conclusive
and binding with respect to Participants and Beneficiaries.
Sec. 5-2. Number and Selection. The Plan shall be administered by an
Administrator or Administrators appointed by the Compensation Committee. Each
Administrator shall serve without compensation for services in connection with
the administration of this Plan and TI shall pay the expenses of administering
the Plan.
Sec. 5-3. Action by Administrator.
(i) If the Administrator is one person, that person shall determine all
actions delegated to the Administrator, except as otherwise provided
below.
(ii) If more than one person is appointed Administrator, all actions of
the Administrator shall be by a majority of the persons so appointed,
except as otherwise provided below. Such actions may be taken at a
meeting of the Administrators or without a meeting by a resolution or
memorandum signed by all the persons then appointed Administrator. No
Administrator shall be entitled to vote or decide upon any matter
pertaining to himself or herself individually but such matter shall
be determined by the remaining Administrator or by a majority of the
remaining Administrators, if any, or if the Administrator is one
person, by the Compensation Committee.
The Administrator may appoint agents, retain legal counsel and other
services, and perform such acts as may be necessary for the proper
administration of the Plan.
Sec. 5-4. Accounts of Participants. The Administrator shall maintain
records of all accounts of Participants and such other records and data as may
be necessary and appropriate for the proper administration of the Plan and to
determine the amounts distributable to Participants and Beneficiaries.
Sec. 5-5. Rules and Regulations. The Administrator may adopt and
promulgate such rules and regulations as it may deem appropriate for the
administration of the Plan. The Administrator shall adopt and promulgate
written rules governing claims procedures reasonably calculated to:
(i) provide adequate written notice to any Participant or other person
whose claim under the Plan has been denied, setting forth the
specific reasons for such denial; and
(ii) afford a reasonable opportunity to such Participant or other person
for a full and fair review by the Plan Administrator of the decision
denying the claim.
The determination of the Administrator upon such review shall be final and
conclusive.
Sec. 5-6. Reliance on Documents. The Administrator shall be entitled to
rely upon, and shall have no liability in relying upon, any representation made
to it by TI or any officer of TI, or upon any paper or document believed by it
to be genuine and to have been signed or sent by the proper person.
Sec. 5-7. Non-Liability. No member of the Board of Directors, nor
Administrator, nor any officer or employee of TI shall be liable for any act
done or omitted by him or her with respect to the Plan except for his or her
own willful misconduct.
Sec. 5-8. Resignation or Removal. Any Administrator may resign by giving
written notice to the Compensation Committee and may be removed by the
Compensation Committee by giving written notice to the Administrator. Upon the
death, resignation, removal or inability of any Administrator to act as such,
the Compensation Committee may appoint a successor.
Sec. 5.9. Information: Overpayment or Underpayment of Benefits. In
implementing the terms of this Plan the Administrator may, without the consent
of notice to any person, release to or obtain from any entity or other
organization or person information, with respect to any persons, which the
Administrator deems to be necessary for such purpose. Any Participant or
Beneficiary claiming benefits under this Plan shall furnish to the
Administrator such information as may be necessary to determine eligibility for
and amount of benefit, as a condition of claim to and receipt of such benefit.
The Administrator may adopt, in its sole discretion, whatever rules procedures
and accounting practices it determines to be appropriate in providing for the
collection of any overpayment of benefits. If a Participant or Beneficiary
receives an underpayment of benefits, the Administrator shall direct that
immediate payment be made to make up for the underpayment. If an overpayment
is made to a Participant or Beneficiary for whatever reason, the Administrator
in its sole discretion, may withhold payment of any further benefits under the
Plan until the overpayment has been collected or may require repayment of
benefits paid under this Plan without regard to further benefits to which the
Participant or Beneficiary may be entitled.
ARTICLE VI
GENERAL PROVISIONS
Sec. 6-1. Amendment, Termination.
(i) The Compensation Committee of the Board of Directors of TI may
change, amend, modify, alter, or terminate the Plan at any time and
in any manner except that no such amendment, modification, or
alteration shall be exercised retroactively to alter or change the
rights of Participants or their Beneficiaries insofar as they relate
to past deferrals, nor shall any such amendment divest any
Participant of any deferral made prior to the amendment. The Company
intends to continue this Plan indefinitely, but nevertheless assumes
no contractual obligation to continue this Plan or makes any promise
to pay benefits other than as provided under this Plan.
(ii) The Board of Directors of TI reserves to its Compensation Committee
the right to discontinue deferrals under a Deferred Compensation
Agreement at any time. In the event of such discontinuance TI
reserves the right to distribute to each Participant the full value
of the Participant's Deferred Compensation Account at any time or
times.
Sec. 6-2. Plan Not an Employment Contract. The Plan is not an employment
contract. It does not give to any person the right to be continued in
employment, and all Participants remain subject to change of compensation,
transfer, change of job, discipline, layoff, discharge or any other change of
employment status. Nothing contained in this Plan shall prevent a Participant
or the Beneficiary from receiving, in addition to any payments provided for
under this Plan, any payments provided for any other Plan or benefit program of
the Company, or which would otherwise be payable or distributable to him or her
or his or her surviving spouse or beneficiary. Nothing in this Plan shall be
construed as preventing TI or any of its Subsidiaries from establishing any
other or different Plans providing for current or deferred compensation for
employees.
Sec. 6-3. Rights of Persons Making Claims. No Employee, Designated
Employee or Participant, or any person or entity claiming through an Employee,
Designated Employee or Participant, shall have any rights whatsoever other than
the rights and benefits specifically granted under this Plan.
Sec. 6-4. Status of Benefits in this Plan. No benefits accrued under,
credited to Accounts under, or paid under this Plan shall constitute "earnings"
or "compensation" for purposes of any other benefit plan sponsored by the
Employers.
IN WITNESS WHEREOF, Texas Instruments Incorporated has caused this
instrument to be executed by its duly authorized officer.
Texas Instruments Incorporated
By: /s/ RICHARD J. AGNICH
----------------------------
Richard J. Agnich
Senior Vice President, General Counsel and Secretary
Exhibit 10(a)(ii)
-----------------
FIRST AMENDMENT
TO RESTATED
TI DEFERRED COMPENSATION PLAN
TEXAS INSTRUMENTS INCORPORATED, a Delaware corporation with its
principal offices in Dallas, Texas (hereinafter referred to as "TI" or the
"Company"), hereby adopts the First Amendment to the restated TI Deferred
Compensation Plan.
TI adopted the TI Supplemental Pension and Profit Sharing Benefit
Plan effective as of September 8, 1978, and the TI Supplemental Pension and
Profit Sharing Benefit Plan II as of January 1, 1993. Both such plans were
amended from time to time. These supplemental plans supplemented pension
benefits provided under the TI Employees Pension Plan and defined
contribution plan benefits provided under the TI Employees Universal Profit
Sharing Plan. The provisions of such supplemental plans relevant to, and
supplementing pension benefits under, the TI Employees Pension Plan were
amended, restated and merged into the TI Employees Supplemental Pension Plan,
effective January 1, 1998. The supplemental pension plan obligations accrued
under the two such supplemental plans are provided on and after January 1,
1998, under the TI Employees Supplemental Pension Plan. The provisions of
the two supplemental plans relevant to, and supplementing benefits under, the
TI Employees Universal Profit Sharing Plan, and effective January 1, 1998,
the TI Employees Retirement and Profit Sharing Plan, were amended, restated
and merged into the TI Deferred Compensation Plan (the "Plan") effective
January 1, 1998.
This First Amendment to the restated TI Deferred Compensation Plan
shall be effective as of the dates indicated below. Except as hereby amended
by this First Amendment to the restated TI Deferred Compensation Plan, the
Plan, as amended and restated effective January 1, 1998, shall continue in
full force and effect.
1. Effective January 1, 1998, a new Section 1-20A is hereby added,
to appear between Section 1.20 and Section 1.21 of the Plan. The
new Section 1.20A shall read as follows:
"Sec. 1-20A. SSI Plans. "SSI Plans" means the Silicon
Systems, Inc. Incentive Stock Plan, effective July 14, 1995
and as amended thereafter, and/or the Silicon Systems, Inc.
Phantom Stock Plan, effective April 1, 1993, and as amended
thereafter."
2. The following provisions are hereby added to Section 3.2(i), at
the end thereof:
"Additionally, commencing with elections effective for the
1999 Plan Year, if a Designated Employee holds an award of
incentive stock or phantom stock granted under the SSI
Plans, the Designated Employee may elect during the
Election Period to defer into a Deferred Compensation
Account no more than 90% of the proceeds otherwise payable
under the terms of the SSI Plans upon the redemption of
phantom stock or incentive stock under the SSI Plans by the
Designated Employee in the subsequent Plan Year. A
Participant's election to defer the receipt of redemption
proceeds under the SSI Plans for the succeeding Plan Year
is irrevocable and shall become effective as of the first
month of the Plan Year next following such Election Period.
Effective January 1, 1998, if a Designated Employee holds
an award of phantom stock under the SSI Plans, and the
phantom stock shares subject to the award will lapse due to
the passage of time after March 31, 1998, and on or before
December 31, 1998 (pursuant to the terms of paragraph 7 of
the SSI Plans), the Designated Employee may elect to defer
the proceeds of the exercise of such otherwise lapsing
phantom stock shares by electing on or before March 31,
1998, to defer into a Deferred Compensation Account no more
than 90% of the proceeds otherwise payable under the terms
of the SSI Plans upon the redemption of the phantom stock
that is subject to lapse in 1998 under the SSI Plans by the
Designated Employee. A Participant's election to defer the
receipt in 1998 of such proceeds under the SSI Plans must
be made on or before March 1, 1998, and shall be
irrevocable. If no election is made to redeem the phantom
stock subject to lapse, any deferral election to defer
proceeds shall be ineffective and such phantom stock shall
lapse in accordance with the provisions of the SSI Plans."
3. Except as amended by this First Amendment, the Company hereby
ratifies the Plan as last amended and restated effective
January 1, 1998.
IN WITNESS WHEREOF, Texas Instruments Incorporated has caused
this instrument to be executed by its duly authorized officer.
Texas Instruments Incorporated
By: /s/ RICHARD J. AGNICH
------------------------------------
Richard J. Agnich
Senior Vice President, General Counsel and Secretary
Exhibit 10(a)(iii)
------------------
SECOND AMENDMENT
TO RESTATED
TI DEFERRED COMPENSATION PLAN
TEXAS INSTRUMENTS INCORPORATED, a Delaware corporation with its
principal offices in Dallas, Texas (hereinafter referred to as "TI" or the
"Company") hereby adopts this Second Amendment to the restated TI Deferred
Compensation Plan.
This Second Amendment to the restated TI Deferred Compensation Plan
shall be effective as of the dates indicated below. Except as hereby amended
by this Second Amendment to the restated TI Deferred Compensation Plan, the
Plan, as previously amended, shall continue in full force and effect.
1. Effective January 1, 2000, a new Section 1-6A is hereby
added, to appear between Section 1-6 and Section 1-7 of the
Plan. The new Section 1-6A shall read as follows:
"Sec. 1-6A. Cash Profit Sharing Compensation. "Cash
Profit Sharing Compensation" means the cash profit sharing
bonus payable for a Plan Year under the Company's cash
profit sharing bonus program, as amended from time to time,
and any successor to that program."
2. Effective January 1, 2000, Section 1-9(i) is hereby amended in
the entirety to read as follows:
"(i) All Compensation, Cash Profit Sharing Compensation or
Incentive Compensation deferred pursuant to Section
3-2 hereof; and"
3. Effective January 1, 2000, a new Section 1-21A is hereby added,
to appear between Section 1-21 and Section 1-22 of the Plan. The
new Section 1-21A shall read as follows:
"Sec. 1-21A. Supplemental Plan Cashout. "Supplemental
Plan Cashout" means the supplemental benefit amount
credited to the Participant's Deferred Compensation Account
pursuant to Section 3-2(iii) and no longer payable under
the TI Supplemental Pension Plan."
4. Effective January 1, 2000, a new Section 3-2(ii) is hereby added,
and Section 3-2(ii), as it appears before this Second Amendment,
is hereby renumbered as Section 3-2(iv). The new Section 3-2(ii)
shall read as follows:
"(ii) A Designated Employee who elects to participate in a
Deferred Compensation Account may, during the
Election Period, elect to defer into the Deferred
Compensation Account no more than 90% of the
Designated Employee's Cash Profit Sharing
Compensation payable in the next Plan Year. A
Participant's election to defer Cash Profit Sharing
Compensation during any succeeding Plan Year is
irrevocable and shall become effective as of the
first month of the Plan Year immediately following
such Election Period."
5. A new Section 3-2(iii) is hereby added, between the new Section
3-2(ii) added by the preceding paragraph and Section 3-2(iv), as
renumbered by the preceding paragraph. The new Section 3-2(iii)
shall read as follows:
"(iii) A Designated Employee who elects to participate in
a Deferred Compensation Account may elect to defer
a Supplemental Plan Cashout to be credited to the
Designated Employee Participant's Account. The
deferral election for such deferral must be given
not later than the calendar year preceding the
calendar year in which the Designated Employee
shall retire (or be subject to any other event
creating an entitlement to payment) under the TI
Employees Pension Plan."
6. Effective January 1, 2000, Section 3-2(iv) (renumbered by
paragraph 4 above) is hereby amended in the entirety to read as
follows:
"(iv) A Designated Employee who elects to participate in a
Deferred Compensation Account may, at any time,
elect to defer into the Deferred Compensation
Account no more than 25% of the Designated
Employee's Compensation (exclusive of Incentive
Compensation and Cash Profit Sharing Compensation)
during a Plan Year. An election for deferral of
Compensation other than Incentive Compensation, Cash
Profit Sharing Compensation and/or a Supplemental
Plan Cashout shall become effective as of the pay
period immediately following the pay period in which
the election was made and shall remain in effect
until changed by a subsequent election, which shall
not be effective until the pay period immediately
following the pay period in which the subsequent
election was made."
7. Effective January 1, 2000, the final paragraph of Section 3-2 is
hereby amended in the entirety to read as follows:
"The Employer of a Designated Employee Participant shall
credit to the Designated Employee Participant's Deferred
Compensation Account the amount of Compensation (exclusive
of Incentive Compensation, Cash Profit Sharing Compensation
and/or a Supplemental Plan Cashout) the Participant has
elected to defer, and the amount of Cash Profit Sharing
Compensation, Incentive Compensation and/or Supplemental
Plan Cashout the Participant has elected to defer. Such
amounts shall be credited as of the date the compensation
so deferred would otherwise have been paid to the
Participant in the absence of the Participant's deferral
election."
8. Effective October 1, 1999, new subparagraphs (d), (e) and (f)
shall be added to Section 3-6(iii), to follow subparagraph
3-6(iii)(c). The word "or" is deleted following the semicolon at
the end of Section 3-6(iii)(b), and a semicolon is inserted in
lieu of the period ending Section 3-6(iii)(c). The new
subparagraphs shall read as follows:
"(d) lump sum payable upon the date on which the
Participant attains the age of 60 years;
(e) a lump sum payable on the date on which the
Participant attains the age of 65 years; or
(f) a lump sum payable on the date on which the
Participant attains the age of 701/2 years."
9. Effective January 1, 1998, a new Section 3-7(vi) is hereby added,
to follow Section 3-7(v). The new Section 3-7(vi) shall read as
follows:
"(vi) Distributions and withdrawals under Article III
shall be made by check or wire transfer of cash and
may be made through a paying agent or recordkeeper
selected by the Administrator."
10. Except as amended by this Second Amendment, the Company hereby
ratifies the Plan as last amended and restated effective January
1, 1998, and as amended thereafter. Attached hereto as an Annex
is a copy of the Plan reflecting the Plan as it shall read after
incorporation of the amendments made through this Second
Amendment and all preceding amendments, and reflecting the
provisions in effect as of January 1, 2000.
IN WITNESS WHEREOF, Texas Instruments Incorporated has caused this
instrument to be executed by its duly authorized officer.
Texas Instruments Incorporated
By: /s/ RICHARD J. AGNICH
----------------------------------------------
Richard J. Agnich
Senior Vice President, General Counsel and Secretary
Exhibit 10(b)(i)
----------------
TI SUPPLEMENTAL PENSION PLAN
Texas Instruments Incorporated, a Delaware corporation with its principal
offices in Dallas, Texas, (hereafter "TI" or "the Company") does hereby amend,
restate, and continue the TI Supplemental Pension and Profit Sharing Benefit
Plan and the TI Supplemental Pension and Profit Sharing Benefit Plan II in
part as the TI Supplemental Pension Plan (hereinafter referred to as the
"Plan").
TI adopted the TI Supplemental Pension and Profit Sharing Benefit Plan
effective as of September 8, 1978, and the TI Supplemental Pension and Profit
Sharing Benefit Plan II as of January 1, 1993. Both such plans were amended
from time to time. These two supplemental plans supplemented pension benefits
provided under the TI Employees Pension Plan and defined contribution plan
benefits provided under the TI Employees Universal Profit Sharing Plan. The
provisions of such supplemental plans relevant to, and supplementing pension
benefits under, the TI Employees Pension Plan are hereby amended, restated and
merged into this Plan, effective January 1, 1998. The supplemental pension
plan obligations accrued under the two prior such supplemental plans will be
provided under this Plan on and after January 1, 1998.
The provisions of the two supplemental plans relevant to, and
supplementing benefits under, the TI Employees Universal Profit Sharing Plan,
and effective January 1, 1998, the TI Employees Retirement and Profit Sharing
Plan, were amended, restated and merged into the TI Deferred Compensation Plan
(the "Deferred Compensation Plan").
Following January 1, 1998, the TI Supplemental Pension and Profit Sharing
Benefit Plan and the TI Supplemental Pension and Profit Sharing Plan II, as
amended from time to time, shall not apply to any Employee of any Employer who
has not commenced receipt of benefits under such supplemental plans prior to
January 1, 1998. The benefits of Employees or Beneficiaries in pay status
prior to January 1, 1998, under such supplemental plans shall continue to be
determined under the provisions of the prior supplemental plans, as
applicable, and not under this Plan.
This Plan as so amended and restated shall be effective as of January 1,
1998.
The purpose of the Plan is to restore certain benefits which cannot be
provided under the TI Employees Pension Plan as a result of deferral of
compensation under the Deferred Compensation Plan or by reason of the
application of section 401(a)(17) and/or section 415 of the Internal Revenue
Code of 1986, as amended (the "Code"), to a select group of management and
highly compensated employees, as described in section 201(2) of the Employee
Retirement Income Security Act of 1974 (hereinafter referred to as "ERISA").
With respect to benefits or contributions lost under the TI Employees Pension
Plan by reason of the operation of section 415 of the Code, this Plan is
intended to constitute an "excess benefit plan", as defined in Section 3 of
ERISA, that is exempt from the provisions of ERISA by reason of
section 4(b)(5) of ERISA.
Article I
Definitions and Construction
Whenever used in this Plan, the following words and phrases shall have
the meanings set forth below, unless a different meaning is plainly required
by the context. Unless otherwise indicated by the context, any masculine
terminology when used in the Plan shall also include the feminine gender, and
the definition of any term in the singular shall also include the plural.
Sec. 1-1. Administrator. "Administrator" means the person or persons
from time to time acting under the provisions of Article V hereof.
Sec. 1-2. Beneficiary. "Beneficiary" means the person or persons named
by a Participant who is not married as his or her Beneficiary, co-Beneficiary,
or contingent Beneficiary under the TI Employees Pension Plan. "Beneficiary"
means, in the case of a married Participant, the spouse of the Participant to
whom the Participant was married at the time of his or her death unless the
Participant has designated another joint annuitant, contingent annuitant,
Beneficiary, co-Beneficiary, or contingent Beneficiary under the TI Employees
Pension Plan, in which case such persons or person shall be the
Beneficiary(ies) under this Plan.
A person who is an alternate payee under a qualified domestic relations
order may be considered a Beneficiary for purposes of this Plan.
Sec. 1-3. Board of Directors. "Board of Directors" means the Board of
Directors of TI or of any Subsidiary which has adopted this Plan.
Sec. 1-4. Code. "Code" means the Internal Revenue Code of 1986, as
amended from time to time.
Sec. 1-5. Compensation Committee. "Compensation Committee" means the
Compensation Committee of the Board of Directors of TI.
Sec. 1-6. Deferred Compensation Plan. "Deferred Compensation Plan"
means the TI Deferred Compensation Plan.
Sec. 1-7. Employee. "Employee" means any employee of TI or its
Subsidiaries, whether full or part-time.
Sec. 1-8. Employer. "Employer" means Texas Instruments Incorporated
and any other corporation which may become a party to this Plan; provided that
TI shall have sole power to amend or terminate this Plan.
Sec. 1-9. ERISA. "ERISA" means the Employee Retirement Income Security
Act of 1974, as amended from time to time.
Sec. 1-10. Participant. "Participant" means both a Participant who is
accruing or has accrued a benefit pursuant to designation under Article III.
Sec. 1-11. Plan Year. "Plan Year" means a calendar year.
Sec. 1-12. Subsidiary. "Subsidiary" means any entity whose assets and
net income are included in the consolidated financial statements of TI and its
subsidiaries audited by TI's independent auditors and reported to shareholders
in the published annual report to shareholders.
Sec. 1-13. Termination of Employment. "Termination of Employment" means
the complete cessation of the employer-employee relationship between TI or any
Subsidiary and a Participant, including a leave of absence from which the
Administrator, in its sole discretion, determines that the Participant is not
expected to return.
Sec. 1-14. Construction. This Plan is not intended to constitute a
"qualified plan" subject to the limitations of section 401(a) of the Code, nor
shall it constitute a "funded plan", for purposes of such requirements. It is
intended that this Plan shall be exempt from the participation and vesting
requirements of Part 2 of Title I of ERISA, the funding requirements of Part 3
of Title I of ERISA and the fiduciary requirements of Part 4 of Title I of
ERISA by reason of the exclusions afforded plans which are unfunded and
maintained by an employer primarily for the purpose of providing deferred
compensation for a select group of management or highly compensated employees.
If any provision of this Plan is determined to be for any reason invalid or
unforceable, the remaining provisions of this plan shall continue in full
force and effect. This Plan shall be governing construed in accordance with
the laws of the State of Texas, except to the extent otherwise required by
reference only and are not to be considered in the construction of this Plan.
This Plan is functionally and operationally related to the TI Employees Pension
Plan, and is to be interpreted in a manner consistent with the TI Employees
Pension Plan to provide the benefits contemplated hereunder in a comprehensive
manner.
Article II
Eligibility and Participation
Sec. 2-1. Eligibility and Participation. Any Employee shall be eligible
for participation in this Plan, and shall automatically become a Participant
in the event, that, pursuant to the terms of Article III, any amount would be
payable to the Participant under this Plan. In the event that a Participant
shall have a Termination of Employment prior to becoming vested in any benefit
under the TI Employees Pension Plan, the Participant shall forfeit any benefits
accrued under this Plan. Conversely, in the event the Participant shall
separate from employment with a vested interest in benefits under the TI
Employees Pension Plan, the Participant shall have a vested interest in the
corresponding benefits under this Plan. Until a vested Participant has
received payment of all benefits credited to or accrued by the Participant
hereunder, the participation of the Participant in this Plan shall continue.
Article III
Supplemental Benefits
Sec. 3-1. Supplemental Benefits. The benefit payable under this Plan to
a Participant shall be the difference between the benefit actually payable
under the TI Employees Pension Plan at the time of computation (and in the
form of benefit for which the computation is made) and the benefit that would
be payable under the TI Employees Pension Plan if:
(a) the TI Employees Pension Plan contained no limit on the Compensation
that may be considered under section 401(a)(17) of the Code (for
purposes of the calculation and accrual of benefits under the TI
Employees Pension Plan);
(b) "Compensation" for each plan year under the TI Employees Pension
Plan included amounts electively deferred, if any, by a Participant
under the Deferred Compensation Plan from earnings that would have
constituted Compensation for such plan year under the TI Employees
Pension Plan, had such amounts not be electively deferred and/or, if
applicable, had section 401(a)(17) of the Code not precluded the
consideration of such earnings as Compensation (in the absence of
such deferral); for such purpose, no amounts of "Incentive
Compensation", as such term is defined in the TI Deferred
Compensation Plan, shall be considered as Compensation for purposes
of calculating this benefit (whether or not such Incentive
Compensation is deferred under the Deferred Compensation Plan; and.
(c) the TI Employees Pension Plan contained no limit pursuant to section
415 of the Code upon the maximum amount of pension that be paid by
the TI Employees Pension Plan (such as the limits in effect on
January 1, 1998, under Section 5.12 of the TI Employees Pension
Plan).
Sec. 3-2. Payment of Supplemental Benefit. Subject to Section 3-3, the
benefit determined pursuant to Section 3-1 shall be paid to the person
entitled thereto as though it were a part of the benefit being paid to such
person under the TI Employees Pension Plan, so that it is payable at the same
time, and in the same form, and subject to the same limits and restrictions
(other than the limitations referenced in subparagraphs (a), (b) and (c) of
Section 3-1) as such person's benefits are subject to under the TI Employees
Pension Plan. In the event that the benefits under the TI Employees Pension
Plan are payable in the form of a direct rollover, the benefits payable under
this Plan shall be payable as though the benefits under the TI Employees
Pension Plan were payable in the normal form of benefit applicable to such
person.
Sec. 3-3. Restrictions. No benefits accrued under this Plan may be
withdrawn by, or distributed to, a Participant while the Participant remains
employed by the Company or an Affiliate. No loans may be made to any
Participant with respect to benefits accrued under this Plan. Benefits
payable under this Plan may not be rolled over or transferred to an individual
retirement account or to any other employee benefit plan. No distribution
shall be made under this Plan by reason of a distribution under the TI
Employees Pension Plan that is made pursuant to section 401(a)(9) of the Code.
In the event that payment of benefits under the TI Employees Pension Plan is
suspended, payment of corresponding benefits under this Plan will be similarly
suspended. Benefits provided under this Plan shall not constitute earnings or
compensation for purposes of determining contributions or benefits under any
other employee benefit plan of the Employers.
Sec. 3-4. Taxes. TI makes no guarantees and assumes no obligation or
responsibility with respect to a Participant's Federal, state, or local
income, estate, inheritance or gift tax obligations, if any, under this Plan.
Any taxes required to be withheld from payment to payees hereunder shall be
deducted and withheld by the Company, benefit provider or funding agent.
Sec. 3-5. Assignment. Except as provided in Section 3-6 below, no
Participant or Beneficiary of a Participant shall have any right to assign,
pledge, hypothecate, anticipate or in any way create a lien on any amounts
payable hereunder. No amounts payable hereunder shall be subject to
assignment or transfer or otherwise be alienable, either by voluntary or
involuntary act, or by operation of law, or subject to attachment, execution,
garnishment, sequestration or other seizure under any legal, equitable or
other process, or be liable in any way for the debts or defaults of
Participants and their Beneficiaries.
Sec. 3-6. Spousal Claims. Any claim against any benefits hereunder for
child support, spousal maintenance or alimony shall be treated in the same
manner as would a claim for corresponding benefits under the TI Employees
Pension Plan and shall be subject to all claims provisions and restrictions of
the TI Employees Pension Plan. The Administrator may delegate the
administration of spousal claims to the Administration Committee under the TI
Employees Pension Plan.
Sec. 3-7. Payment in the Event of Legal Disability. If a Participant or
Beneficiary entitled to distribution from the Plan is under a legal
disability, or in the sole judgment of the Administrator is unable to apply
such distribution to his or her own interest and advantage, the Administrator
may direct the Plan to make such payment, to be expended for his or her
benefit in any one or more of the following ways:
(a) directly to such person;
(b) such person's legal guardian or conservator; or
(c) to such person's spouse or to any person charged with his or her
support.
The decision of the Administrator shall in each case be final and binding
upon all persons in interest. Any such payment shall completely discharge the
obligation of the Administrator, TI and the Plan with respect to such payment.
Article IV
Funding
Sec. 4-1. Funding. Benefits under this Plan shall be funded solely by
the Employers. Benefits payable under this Plan shall be paid from the general
assets of the Employers and this Plan shall constitute the Employers' unfunded
and unsecured promise to pay such benefits. Notwithstanding the foregoing, TI
may create reserves, funds, and provide for amounts to be held in trust on
behalf of the Employers under such trust agreements or custodial arrangements
as the Compensation Committee in its absolute and sole discretion deems
appropriate.
Sec. 4-2. Creditor Status. A Participant and his or her Beneficiary or
Beneficiaries shall be general creditors of TI with respect to the payment of
any benefit under this Plan.
Article V
Administration of the Plan
Sec. 5-1. Administration. The Administrator shall be charged with the
administration of the Plan and shall have the power and authority as may be
necessary and appropriate for such purposes, including (but not by way of
limitation), the defense of lawsuits and conduct of litigation in the name of
the Plan (subject to the approval of the General Counsel of TI), the full
power and discretion to interpret and construe this Plan where it concerns
question of eligibility or status, and subject to the opportunity for review
of denied claims pursuant to Section 5-5 below, the rights of Participants and
others hereunder, and in general decide any dispute arising under this Plan.
In all such cases the determination of the Administrator shall be final,
conclusive and binding with respect to Participants and Beneficiaries.
Sec. 5-2. Number and Selection. The Plan shall be administered by an
Administrator or Administrators appointed by the Compensation Committee. Each
Administrator shall serve without compensation for services in connection
with the administration of this Plan and TI shall pay the expenses of
administering the Plan.
Sec. 5-3. Action by Administrator.
(a) If the Administrator is one person, that person shall determine all
actions delegated to the Administrator, except as otherwise provided below.
(b) If more than one person is appointed Administrator, all actions of
the Administrator shall be by a majority of the persons so appointed, except
as otherwise provided below. Such actions may be taken at a meeting of the
Administrator or without a meeting by a resolution or memorandum signed by all
the persons then appointed Administrator. No Administrator shall be entitled
to vote or decide upon any matter pertaining to himself or herself
individually but such matter shall be determined by the remaining
Administrator or by a majority of the remaining Administrators, if any, or if
the Administrator is one person, by the Compensation Committee.
The Administrator may appoint agents, retain legal counsel and other
services, and perform such acts as may be necessary for the proper
administration of the Plan.
Sec. 5-4. Recordkeeping. The Administrator shall maintain records and
data as may be necessary and appropriate for the proper administration of the
Plan and shall determine the amounts distributable to Participants and
Beneficiaries.
Sec. 5-5. Rules and Regulations. The Administrator may adopt and
promulgate such rules and regulations as it may deem appropriate for the
administration of the Plan. The Administrator shall adopt and promulgate
written rules governing claims procedures reasonably calculated to:
(i) provide adequate written notice to any Participant or other person whose
claim under the Plan has been denied, setting forth the specific reasons for
such denial; and
(ii) afford a reasonable opportunity to such Participant or other person for
a full and fair review by the Plan Administrator of the decision denying the
claim.
The determination of the Administrator upon such review shall be final and
conclusive.
Sec. 5-6. Reliance on Documents. The Administrator shall be entitled to
rely upon, and shall have no liability in relying upon, any representation
made to it by TI or any officer of TI, or upon any paper or document believed
by it to be genuine and to have been signed or sent by the proper person.
Sec. 5-7. Non-Liability. No member of the Board of Directors, nor
Administrator, nor any officer or employee of TI shall be liable for any act
done or omitted by him or her with respect to the Plan except for his or her
own willful misconduct.
Sec. 5-8. Resignation or Removal. Any Administrator may resign by
giving written notice to the Compensation Committee and may be removed by the
Compensation Committee by giving written notice to the Administrator. Upon the
death, resignation, removal or inability of any Administrator to act as such,
the Compensation Committee may appoint a successor.
Sec. 5.9. Information: Overpayment or Underpayment of Benefits. In
implementing the terms of this Plan the Administrator may, without the consent
of notice to any person, release to or obtain from any entity or other
organization or person information, with respect to any persons, which the
Administrator deems to be necessary for such purpose. Any Participant or
Beneficiary claiming benefits under this Plan shall furnish to the
Administrator such information as may be necessary to determine eligibility
for and amount of benefit, as a condition of claim to and receipt of such
benefit. The Administrator may adopt, in its sole discretion, whatever rules,
procedures and accounting practices it determines to be appropriate in
providing for the collection of any overpayment of benefits. If a Participant
or Beneficiary receives an underpayment of benefits, the Administrator shall
direct that immediate payment be made to make up for the underpayment. If an
overpayment is made to a Participant or Beneficiary for whatever reason, the
Administrator in its sole discretion, may withhold payment of any further
benefits under the Plan until the overpayment has been collected or may
require repayment of benefits paid under this Plan without regard to further
benefits to which the Participant or Beneficiary may be entitled.
Article VI
General Provisions
Sec. 6-1. Amendment, Termination. The Compensation Committee of the
Board of Directors of TI may change, amend, modify, alter, or terminate the
Plan at any time and in any manner, prospectively or retroactively, except
that no such amendment, modification, alteration or termination shall be
exercised retroactively to reduce or eliminate the benefit accrued by a
Participant to the date of amendment, modification or termination. The
Company intends to continue this Plan indefinitely, but nevertheless assumes
no contractual obligation beyond the promise to pay the benefits described in
this Plan.
Sec. 6-2. Plan Not an Employment Contract. The Plan is not an
employment contract. It does not give to any person the right to be continued
in employment, and all Participants remain subject to change of compensation,
transfer, change of job, discipline, layoff, discharge or any other change of
employment status. Nothing contained in this Plan shall prevent a Participant
or Beneficiary from receiving, in addition to any payments provided for under
this Plan, any payments provided for any other Plan or benefit program of the
Employers, or which would otherwise be payable or distributable to him or her
or his or her surviving spouse or Beneficiary. Nothing in this Plan shall be
construed as preventing TI or any of its subsidiaries from establishing any
other or different Plans providing for current or deferred supplemental
compensation for employees.
Sec. 6-3. Rights of Persons Making Claims. No Employee, or Participant,
or any person or entity claiming through an Employee or Participant, shall
have any rights whatsoever other than the rights and benefits specifically
granted under this Plan.
In witness whereof, Texas Instruments Incorporated has caused this
instrument to be executed by its duly authorized officer.
Texas Instruments Incorporated:
By: /s/ RICHARD J. AGNICH
--------------------------------
Richard J. Agnich
Senior Vice President, General Counsel
and Secretary
Exhibit 10(b)(ii)
-----------------
FIRST AMENDMENT
TO
TI SUPPLEMENTAL PENSION PLAN
TEXAS INSTRUMENTS INCORPORATED, a Delaware corporation with its
principal offices in Dallas, Texas (hereinafter referred to as "TI" or the
"Company") hereby adopts this First Amendment to the TI Supplemental Pension
Plan, which was amended and restated in the entirety effective as of
January 1, 1998.
This First Amendment to the TI Supplemental Pension Plan shall be
effective January 1, 2000. Except as hereby amended, the TI Supplemental
Pension Plan, as hereby amended, shall continue in full force and effect.
1. Section 3-2 is hereby amended and restated in the entirety to read
as follows:
"Sec. 3.2. Payment of Supplemental Benefit. Subject to
Section 3-3, and except to the extent deferred pursuant to the
Deferred Compensation Plan, the benefit determined pursuant to
Section 3-1 shall be paid to the person entitled thereto as though
it were a part of the benefit being paid to such person under the
TI Employees Pension Plan, so that it is payable at the same time,
and in the same form, and subject to the same limits and
restrictions (other than the limitations referenced in
subparagraphs (a), (b) and (c) of Section 3-1) as such person's
benefits are subject to under the TI Employees Pension Plan. In
the event that benefits under the TI Employees Pension Plan are
payable in the form of a direct rollover, unless the benefits
payable under this Plan are deferred pursuant to the terms and
provisions of the Deferred Compensation Plan, the benefits payable
under this Plan shall be payable as though the benefits under the
TI Employees Pension Plan were payable in the normal form of
benefit applicable to such person. If only part of the
Participant's benefit under this Plan are deferred pursuant to the
terms and provisions of the Deferred Compensation Plan, the
remaining benefits, after actuarial adjustment to reflect the
amount deferred, shall be paid in accordance with the preceding
provisions of this Section 3-2."
2. Section 3-3 is hereby amended and restated in the entirety to read
as follows:
"Sec. 3-3. Restrictions. No benefits accrued under this Plan
may be withdrawn by, or distributed to, a Participant while the
Participant remains employed by the Company or an Affiliate,
provided that all or a part of the benefits payable under this Plan
may be deferred pursuant to the terms and provisions of the
Deferred Compensation Plan. No loans may be made to any
Participant with respect to benefit accrued under this Plan.
Except to the extent deferred pursuant to the terms and provisions
of the Deferred Compensation Plan, benefits payable under this Plan
may not be rolled over or transferred to an individual retirement
account or to any other employee benefit plan. No distribution
shall be made under this Plan by reason of a distribution under the
TI Employees Pension Plan that is made pursuant to section
401(a)(9) of the Code. In the event that payment of benefits under
the TI Employees Pension Plan is suspended and the benefits under
this Plan have not been deferred pursuant to the terms and
provisions of the Deferred Compensation Plan, payment of
corresponding benefits under this Plan will be similarly suspended.
To the extent that a Participant defers payment of benefits under
this Plan pursuant to the terms and provisions of the Deferred
Compensation Plan, the Participant shall not be entitled to
benefits under this Plan, but the corresponding deferred benefits
shall be payable in accordance with the terms and provision of the
Deferred Compensation Plan. In the event that only a part of the
benefits of the Participant under this Plan are deferred pursuant
to the Deferred Compensation Plan, the remaining benefits,
actuarially adjusted to reflect subtraction of the amount so
deferred, shall be payable in accordance with Section 3-1.
Actuarial equivalency calculations shall be determined by the
Administrator, in its sole and absolute discretion. Benefits
provided under this Plan shall not constitute earnings or
compensation for purposes of determining contributions or benefits
under any other employee benefit plan of the Employers."
3. The first sentence of Section 3-5 is hereby amended to read as
follows:
"Except as provided in Section 3-6 below, or except as the
Participant may defer payment of benefits under this Plan pursuant
to the terms and provisions of the Deferred Compensation Plan, no
Participant or beneficiary of a Participant shall have any right to
assign, pledge, hypothecate, anticipate or in any way create a lien
on any amounts payable hereunder."
4. Except as hereby amended by this First Amendment to TI
Supplemental Pension Plan, the TI Supplemental Pension Plan as
previously amended and restated effective January 1, 1998 is
hereby ratified.
IN WITNESS WHEREOF, Texas Instruments Incorporated has caused this
instrument to be executed by its duly authorized officer.
Texas Instruments Incorporated:
By: /s/ RICHARD J. AGNICH
--------------------------------
Richard J. Agnich
Senior Vice President, General Counsel
and Secretary
<TABLE>
<CAPTION>
EXHIBIT 11
----------
TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES
EARNINGS PER COMMON AND DILUTIVE POTENTIAL COMMON SHARE
Years ended December 31
------------------------------------------
1999 1998 1997
---------- ---------- ----------
<S> <C> <C> <C>
Income from continuing operations
before extraordinary item (in millions).................... $ 1,406 $ 416 $ 339
Add: Interest, net of tax and profit sharing effect,
on convertible debentures assumed converted......... -- -- --
---------- ---------- ----------
Adjusted income from continuing operations
before extraordinary item.................................. 1,406 416 339
Discontinued operations:
Income from operations....................................... -- -- 52
Gain on sale................................................. -- -- 1,473
Extraordinary item............................................. -- -- (22)
---------- ---------- ----------
Adjusted net income............................................ $ 1,406 $ 416 $ 1,842
========== ========== ==========
Diluted earnings per common and dilutive potential common share:
Weighted average common shares outstanding (in thousands)...... 804,198 796,900 785,641
Weighted average dilutive potential common shares:
Stock option and compensation plans........................ 32,562 21,350 19,661
Convertible debentures..................................... -- -- 6,534
---------- ---------- ----------
Weighted average common and dilutive potential common shares... 836,760 818,250 811,836
========== ========== ==========
Diluted earnings per common share:
Income from continuing operations
before extraordinary item................................ $ 1.68 $ .51 $ .42
Discontinued operations:
Income from operations..................................... -- -- .07
Gain on sale............................................... -- -- 1.81
Extraordinary item........................................... -- -- (.03)
---------- ---------- ----------
Net income................................................... $ 1.68 $ .51 $ 2.27
========== ========== ==========
Basic earnings per common share:
Weighted average common shares outstanding (in thousands)...... 804,198 796,900 785,641
========== ========== ==========
Basic earnings per common share:
Income from continuing operations
before extraordinary item................................ $ 1.75 $ .52 $ .43
Discontinued operations:
Income from operations..................................... -- -- .07
Gain on sale............................................... -- -- 1.87
Extraordinary item........................................... -- -- (.03)
---------- ---------- ----------
Net income................................................... $ 1.75 $ .52 $ 2.34
========== ========== ==========
</TABLE>
<TABLE>
<CAPTION>
EXHIBIT 12
----------
TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Dollars in millions)
<S> <C> <C> <C> <C> <C>
1999 1998 1997 1996 1995
------ ------ ------ ------ ------
Income before income taxes
and fixed charges:
Income before extraordinary item,
interest expense on loans,
capitalized interest amortized,
and provision for income taxes.......... $2,112 $ 725 $ 882 $ 105 $1,563
Add interest attributable to
rental and lease expense................ 30 41 44 44 41
------ ------ ------ ------ ------
$2,142 $ 766 $ 926 $ 149 $1,604
====== ====== ====== ====== ======
Fixed charges:
Total interest on loans (expensed
and capitalized).......................... $ 84 $ 85 $ 114 $ 108 $ 69
Interest attributable to rental
and lease expense......................... 30 41 44 44 41
------ ------ ------ ------ ------
Fixed charges................................. $ 114 $ 126 $ 158 $ 152 $ 110
====== ====== ====== ====== ======
Ratio of earnings to fixed charges............ 18.8 6.1 5.8 * 14.5
====== ====== ====== ====== ======
* Not meaningful. The coverage deficiency was $3 million in 1996.
</TABLE>
Exhibit 21
----------
TEXAS INSTRUMENTS INCORPORATED AND SUBSIDIARIES
LIST OF SUBSIDIARIES OF THE REGISTRANT
The following are current subsidiaries of the Registrant.
Subsidiary and Name Under Which Business is Done Where Organized
- ------------------------------------------------ ---------------
Amati Communications Corporation Delaware
Auto Circuits, Inc. Massachusetts
Automotive Sensors & Controls Dresden GmbH Germany
Benchmarq Microelectronics Corporation of South Korea Delaware
Benchmarq Microelectronics International, Ltd. Barbados
Butterfly Communications Inc. Delaware
European Engineering and Technologies S.p.A. Italy
GO DSP Corporation Canada
ICOT International Limited United Kingdom
Power Trends Foreign Sales Corporation Barbados
Power Trends, Inc. Illinois
Silicon Systems (Singapore) Pte Ltd Singapore
Telogy Networks, Inc. Delaware
Telogy Networks (UK) Limited United Kingdom
Texas Instrumentos Eletronicos do Brasil Limitada Brazil
Texas Instruments A/S, Denmark Denmark
Texas Instruments Asia Limited Delaware
Texas Instruments Australia Limited Australia
Texas Instruments Automotive Sensors and Controls Delaware
San Jose Inc.
Texas Instruments (Bahamas) Limited Bahamas
Texas Instruments Belgium Belgium
Texas Instruments Canada Limited Canada
Texas Instruments (China) Company Limited China
Texas Instruments China Incorporated Delaware
Texas Instruments de Mexico, S.A. de C.V. Mexico
Texas Instruments Deutschland G.m.b.H. Germany
Texas Instruments Electronic Systems Sdn. Bhd. Malaysia
Texas Instruments Espana, S.A. Spain
Texas Instruments Foreign Sales Corporation Barbados
Texas Instruments France S.A. France
Texas Instruments Gesellschaft m.b.H. Austria
Texas Instruments Holland B.V. Netherlands
Texas Instruments Hong Kong Limited Hong Kong
Texas Instruments (India) Limited India
Texas Instruments Insurance (Bermuda) Limited Bermuda
Texas Instruments International Capital Corporation Delaware
Texas Instruments International (Overseas) Limited United Kingdom
Texas Instruments International Trade Corporation Delaware
Texas Instruments (Ireland) Limited Ireland
Texas Instruments (Israel) Cable Broadband Israel
Communications Ltd.
Texas Instruments Israel Ltd. Israel
Texas Instruments Italia S.p.A. Italy
Texas Instruments Japan Limited Japan
Texas Instruments Korea Limited Korea
Texas Instruments Limited United Kingdom
Texas Instruments Malaysia Sdn. Bhd. Malaysia
Texas Instruments Oy Finland
Texas Instruments (Philippines) Incorporated Delaware
Texas Instruments Richardson LLC Delaware
Texas Instruments (Shanghai) Co., Ltd. China
Texas Instruments Singapore (Pte) Limited Singapore
Texas Instruments Supply Company Texas
Texas Instruments Taiwan Limited Taiwan
Texas Instruments Trade & Investment Company S.A. Panama
Texas Instruments Tsukuba Research and Development Japan
Center Limited
TI Europe Limited United Kingdom
TI Information Engineering International Incorporated Delaware
TI Mexico Trade, S.A. de C.V. Mexico
Unitrode B.V. Netherlands
Unitrode Corporation Maryland
Unitrode Electronics Asia Limited Hong Kong
Unitrode Electronics B.V. Netherlands
Unitrode Electronics GmbH Germany
Unitrode Electronics (Singapore) Pte Ltd Singapore
Unitrode Export, Inc. Barbados
Unitrode Ireland Ltd. Ireland
Unitrode-Maine Maine
Unitrode S.r.l. Italy
Unitrode Trading (Singapore) Pte. Ltd. Singapore
Unitrode (UK) Limited United Kingdom
EXHIBIT 23
----------
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Annual Report on Form
10-K of Texas Instruments Incorporated of our report dated January 24, 2000,
included in the proxy statement for the 2000 annual meeting of stockholders of
Texas Instruments Incorporated.
Our audits also included the financial statement schedule of Texas Instruments
Incorporated listed in Item 14(a). This schedule is the responsibility of the
Registrant's management. Our responsibility is to express an opinion based on
our audits. In our opinion, the financial statement schedule referred to
above, when considered in relation to the basic financial statements taken as
a whole, presents fairly in all material respects the information set forth
therein.
We also consent to the incorporation by reference in the following
registration statements, and in the related prospectuses thereto, of our
report dated January 24, 2000 with respect to the consolidated financial
statements and schedule of Texas Instruments Incorporated, included in or
incorporated by reference in this Annual Report on Form 10-K for the year
ended December 31, 1999: Registration Statements (Forms S-8) No. 33-61154,
No. 33-21407 (as amended), No. 33-42172 No. 33-54615, No. 333-07127, No.
333-41913, No. 333-41919, No. 333-31319, No. 333-31321, No. 333-31323 and No.
333-48389, and Registration Statements (Form S-3) No. 333-03571 and No. 333-
93011, and Registration Statements (Form S-4) No. 333-89433, No. 333-89097,
No. 333-87199 and No. 333-80157.
/s/ ERNST & YOUNG LLP
Dallas, Texas
February 29, 2000
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from THE
CONSOLIDATED FINANCIAL STATEMENTS OF TEXAS INSTRUMENTS INCORPORATED AND
SUBSIDIARIES AS OF DECEMBER 31, 1999, AND FOR THE YEAR THEN ENDED, and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> DEC-31-1999
<CASH> 662
<SECURITIES> 2,000
<RECEIVABLES> 1,843
<ALLOWANCES> 67
<INVENTORY> 845
<CURRENT-ASSETS> 6,055
<PP&E> 7,120
<DEPRECIATION> 3,285
<TOTAL-ASSETS> 15,028
<CURRENT-LIABILITIES> 2,628
<BONDS> 1,097
0
0
<COMMON> 814
<OTHER-SE> 8,441
<TOTAL-LIABILITY-AND-EQUITY> 15,028
<SALES> 9,468
<TOTAL-REVENUES> 9,468
<CGS> 4,931
<TOTAL-COSTS> 4,931
<OTHER-EXPENSES> 1,333
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 75
<INCOME-PRETAX> 2,019
<INCOME-TAX> 613
<INCOME-CONTINUING> 1,406
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,406
<EPS-BASIC> 1.75
<EPS-DILUTED> 1.68
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This Restated Financial Data Schedule contains summary financial
information extracted from THE CONSOLIDATED FINANCIAL STATEMENTS OF TEXAS
INSTRUMENTS INCORPORATED AND SUBSIDIARIES AS OF DECEMBER 31, 1998, AND FOR
THE YEAR THEN ENDED, and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> DEC-31-1998
<CASH> 632
<SECURITIES> 1,709
<RECEIVABLES> 1,373
<ALLOWANCES> 72
<INVENTORY> 618
<CURRENT-ASSETS> 4,999
<PP&E> 6,536
<DEPRECIATION> 3,085
<TOTAL-ASSETS> 11,490
<CURRENT-LIABILITIES> 2,223
<BONDS> 1,027
0
0
<COMMON> 400
<OTHER-SE> 6,336
<TOTAL-LIABILITY-AND-EQUITY> 11,490
<SALES> 8,617
<TOTAL-REVENUES> 8,617
<CGS> 5,479
<TOTAL-COSTS> 5,479
<OTHER-EXPENSES> 1,225
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 75
<INCOME-PRETAX> 632
<INCOME-TAX> 216
<INCOME-CONTINUING> 416
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 416
<EPS-BASIC> .52
<EPS-DILUTED> .51
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This Restated Financial Data Schedule contains summary financial
information extracted from THE CONSOLIDATED FINANCIAL STATEMENTS OF TEXAS
INSTRUMENTS INCORPORATED AND SUBSIDIARIES AS OF DECEMBER 31, 1997, AND FOR
THE YEAR THEN ENDED, and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<MULTIPLIER> 1,000,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<CASH> 1,083
<SECURITIES> 2,022
<RECEIVABLES> 1,735
<ALLOWANCES> 62
<INVENTORY> 760
<CURRENT-ASSETS> 6,249
<PP&E> 7,566
<DEPRECIATION> 3,302
<TOTAL-ASSETS> 11,093
<CURRENT-LIABILITIES> 2,541
<BONDS> 1,286
0
0
<COMMON> 398
<OTHER-SE> 5,711
<TOTAL-LIABILITY-AND-EQUITY> 11,093
<SALES> 9,972
<TOTAL-REVENUES> 9,972
<CGS> 6,179
<TOTAL-COSTS> 6,179
<OTHER-EXPENSES> 1,556
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 94
<INCOME-PRETAX> 771
<INCOME-TAX> 432
<INCOME-CONTINUING> 339
<DISCONTINUED> 1,525
<EXTRAORDINARY> (22)
<CHANGES> 0
<NET-INCOME> 1,842
<EPS-BASIC> 2.34
<EPS-DILUTED> 2.27
</TABLE>
