Exhibit 10(b)
TI EMPLOYEES NON-QUALIFIED
PENSION PLAN II
(EFFECTIVE JANUARY 1,
2009)
TI EMPLOYEES NON-QUALIFIED
PENSION PLAN II
TEXAS
INSTRUMENTS INCORPORATED, a Delaware corporation with its principal
offices in Dallas, Texas (hereinafter referred to as
“TI” or “the Company”), froze the TI
Employees Supplemental Pension Plan (the "Frozen Plan"), effective
as of December 31, 2004, to the extent benefits under that plan
were earned and vested as of that date, and continued said plan in
accordance with its terms, to provide for the payment of the
benefits which were earned, vested and frozen as of December 31,
2004. Subsequently, TI changed the name of the Frozen
Plan to the TI Employees Non-Qualified Pension Plan.
Effective as of
January 1, 2005, TI established a new non-qualified pension plan
(the “New Plan”) in order to provide (i) for the
payment of the frozen earned benefits under the Frozen Plan which
were not vested as of January 1, 2005, and (ii) to provide a select
group of management or highly compensated employees described in
Section 201(2) of the Employee Retirement Income Security Act of
1974, as amended (“ERISA”) with the opportunity to
restore certain benefits which cannot be provided under the TI
Employees Pension Plan from and after January 1, 2005 as a result
of (a) deferral of compensation under a new deferred compensation
plan established effective as of January 1, 2005 (known
from and after January 1, 2009 as the “TI Deferred
Compensation Plan”), or (b) the application of Section
401(a)(17) and/or Section 415 of the Internal Revenue Code of 1986,
as amended (the “Code”). TI maintained the
New Plan in accordance with the interim guidance promulgated under
Section 409A of the Code. In addition , for
periods prior to January 1, 2009 the benefits payable under the New
Plan may be deferred pursuant to the terms and provisions of the
new deferred compensation plan established effective as of January
1, 2005. The benefits provided under the New Plan are
unfunded with the result that the participants in the Plan are
general unsecured creditors of TI.
TI hereby
amends and restates the New Plan, effective as of January 1, 2009
(the “Plan”), in the form provided herein in order to
remove the option of deferring payment of the benefits under this
Plan, to remove the entitlement to benefits upon a Change in
Control, as defined in the New Plan, to comply with the Final
Treasury Regulations under Section 409A of the Code and to name the
New Plan the “TI Non-Qualified Pension Plan
II.” 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.
Except as
otherwise provided herein, the earning of benefits and payment of
those benefits under the New Plan shall be governed by the
applicable interim guidance under Section 409A of the Code in
effect prior to January 1, 2009, and the earning of benefits and
payment of those benefits from and after January 1, 2009 shall be
governed by the terms and conditions of this Plan.
Article
I
Definitions
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. Administration
Committee . “Administration
Committee” 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,
entity or entities, trust or trusts, or the Participant’s
estate, including one or more organizations described in each of
Sections 170(c), 2055(a), and 2522(a) of the Code (or any
substitute provisions), named by a Participant who is not married
as his Beneficiary or contingent Beneficiary under the TI Employees
Pension Plan. “Beneficiary” means, in the
case of a married Participant, the spouse (as defined in the
Defense of Marriage Act) of the Participant at the time of his
death, unless the Participant has designated another joint
annuitant, contingent annuitant, Beneficiary, or contingent
Beneficiary under the TI Employees Pension Plan, in which case such
persons or person, entity or entities, trust or trusts, or the
Participant’s estate 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.
Sec. 1-5. Compensation
Committee . “Compensation Committee”
means the Compensation Committee of the Board of Directors of
TI.
Sec. 1-6. Employee
. “Employee” means any employee of TI or its
Subsidiaries, whether full or part-time, other than an employee who
is defined as a “Tucson Participant” in Appendix E of
the TI Employees Pension Plan.
Sec. 1-7. Employer
. “Employer” means Texas Instruments
Incorporated.
Sec. 1-8. ERISA
. “ERISA” means the Employee Retirement
Income Security Act of 1974, as amended.
Sec. 1-9. Participant
. “Participant” means an individual entitled
to a supplemental pension pursuant to the provisions of Article
III.
Sec. 1-10. Plan Year
. “Plan Year” means a calendar
year.
Sec. 1-11. Present
Value . “Present Value” means, at
any time, the actuarial lump sum value determined at such time of
the applicable benefit, based on the actuarial assumptions used to
determine single sum payments as set forth in Section 1.2(b)(2)(B),
or any successor provision, of the TI Employees Pension
Plan.
Sec. 1-12. Separation from
Service . “Separation from Service”
means a termination of services provided by a Participant to an
Employer and any other member of the controlled group of
corporations (as defined in Section 414(b) of the Code) which
includes TI (hereinafter for purposes of this Section 1-12, TI and
such other controlled group members being referred to as
“ERISA Affiliates”), whether voluntarily or
involuntarily, other than by reason of death, as determined by the
Administration Committee in accordance with Treas. Reg.
§1.409A-1(h). In determining whether a Participant
has experienced a Separation from Service, the following provisions
shall apply:
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For a
Participant who provides services to an Employer as an Employee, a
Separation from Service shall occur when such Participant has
experienced a termination of employment with the Employer or an
ERISA Affiliate. A Participant shall be considered to
have experienced a termination of employment when the facts and
circumstances indicate that the Participant and the Employer
reasonably anticipate that either (a) no further services will be
performed for the Employer or an ERISA Affiliate after a certain
date, or (b) that the level of bona fide services the Participant
will perform for the Employer or an ERISA Affiliate after such date
(whether as an Employee or as an independent contractor) will
permanently decrease to no more than 20% of the average level of
bona fide services performed by such Participant (whether as an
Employee or an independent contractor) over the immediately
preceding thirty-six (36) month period (or the full period of
services to the Employer if the Participant has been providing
services to the Employer less than thirty-six (36)
months).
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If a
Participant is on military leave, sick leave, or other bona fide
leave of absence, the employment relationship between the
Participant and the Employer shall be treated as continuing intact,
provided that the period of such leave does not exceed six (6)
months; or if longer, so long as the Participant retains a right to
reemployment with the Employer or an ERISA Affiliate under an
applicable statute or by contract. If the period of a
military leave, sick leave, or other bona fide leave of absence
exceeds six (6) months and the Participant does not retain a right
to reemployment under an applicable statute or by contract, the
employment relationship shall be considered to be terminated for
purposes of the Plan as of the first business day immediately
following the end of such six (6) month period. If a
leave of absence is due to any medically determinable physical or
mental impairment that can be expected to result in death or can be
expected to last for a continuous period of not less than six (6)
months, where such impairment causes the Participant to be unable
to perform the duties of his position of employment or any
substantially similar position of employment, a twenty-nine (29)
month period of absence shall be substituted for such six (6) month
period. In applying the provisions of this paragraph, a
leave of absence shall be considered a bona fide leave of absence
only if there is a reasonable expectation that the Participant will
return to perform services for an Employer or an ERISA
Affiliate.
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Sec. 1-13. Specified
Employee . “Specified Employee”
means any Participant who is determined to be a “key
employee” (as defined under Section 416(i) of the Code
without regard to paragraph (5) thereof) for the applicable period,
as determined annually by the Administration Committee in
accordance with Treas. Reg. §1.409A-1(i). In
determining whether a Participant is a Specified Employee, the
following provisions shall apply:
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Identification
of the individuals who fall within the definition of “key
employee” under Code Section 416(i) without regard to
paragraph (5) thereof) shall be based upon the twelve (12) month
period ending on each December 31 st (referred to below as the “identification
date”). In applying the applicable provisions of
Code Section 416(i) to
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identify such
individuals, “compensation” shall be determined in
accordance with Treas. Reg. §1.415(c)-2(a) without regard to
(a) any safe harbor provided in Treas. Reg. §1.415(c)-2(d),
(b) any of the special timing rules provided in Treas. Reg.
§1.415(c)-2(e), and (c) any of the special rules provided in
Treas. Reg. §1.415(c)-2(g); and
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Each
Participant who is a “key employee” in accordance with
part (i) of this Section shall be treated as a Specified Employee
for purposes of this Plan if such Participant experiences a
Separation from Service during the twelve (12) month period that
begins on the April 1 st following the applicable identification
date.
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Sec. 1-14. 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.
Article
II
Eligibility and
Participation
Sec. 2-1. Eligibility and
Participation . Any Employee who was a
Participant in the TI Employees Pension Plan on December 31, 1997
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 experience a Separation from Service 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. A vested Participant shall continue to participate
in this Plan until such Participant has received payment of all
benefits credited to or accrued by the Participant
hereunder.
Article
III
Supplemental
Benefits
Sec. 3-1. Supplemental
Benefits .
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The benefit
payable under this Plan to a Participant shall be the difference
between the Present Value of the benefit actually payable under the
TI Employees Pension Plan at the time of computation (based on the
form of benefit for which the computation is made) and the Present
Value of the benefit that would be payable under the TI Employees
Pension Plan at such time of computation (in the same form as
provided above) if:
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The TI
Employees Pension Plan contained n
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