ex101.htm


    Exhibit
10.1

    
      TEXAS
INSTRUMENTS 2009 LONG-TERM INCENTIVE PLAN

      
        As
amended September 17, 2009

         

            SECTION
1 .  Purpose.

         

            The Texas
Instruments 2009 Long-Term Incentive Plan is intended as a successor plan to the
Company’s 2000 Long-Term Incentive Plan, 2003 Long-Term Incentive Plan and the
predecessors thereto.  This Plan is designed to enhance the ability of
the Company to attract and retain exceptionally qualified individuals and to
encourage them to acquire a proprietary interest in the growth and performance
of the Company.

         

            SECTION
2 .  Definitions.

         

            As used in
the Plan, the following terms shall have the meanings set forth in this Section
2.  Any definition of a performance measure used in connection with an
Award described by Section 11(f) shall have the meaning commonly ascribed to
such term by generally acceptable accounting principles as practiced in the
United States.

         

            (a)
“Affiliate” shall mean (i) any
entity that, directly or indirectly, is controlled by the Company and (ii) any
entity in which the Company has a significant equity interest, in either case as
determined by the Committee.

         

            (b) “Award” shall mean any Option,
award of Restricted Stock, Restricted Stock Unit, Performance Unit or Other
Stock-Based Award granted under the Plan.

         

            (c) “Award Agreement” shall mean
any written agreement, contract or other instrument or document evidencing an
Award granted under the Plan, which may, but need not, be executed or
acknowledged by a Participant.  An Award Agreement may be in
electronic form.

         

            (d) “Board” shall mean the board of
directors of the Company.

           

            (e)
“Cash Flow” for a period shall
mean net cash provided by operating activities.

         

            (f) “Change in Control” shall mean
an event that will be deemed to have occurred:

        
          


          
            	
                     
      

                  	
                    (i)

                  	
                    On
      the date any Person, other than (1) the Company or any of its
      Subsidiaries, (2) a trustee or other fiduciary holding stock under an
      employee benefit plan of the Company or any of its Affiliates, (3) an
      underwriter temporarily holding stock pursuant to an offering of such
      stock, or (4) a corporation owned, directly or indirectly, by the
      stockholders of the Company in substantially the same proportions as their
      ownership of stock of the Company, acquires ownership of stock of the
      Company that, together with stock held by such Person, constitutes more
      than 50 percent of the total fair market value or total voting power of
      the stock of the Company.  However, if any Person is considered
      to own more than 50 percent of the total fair market value or total voting
      power of the stock of the Company, the acquisition of additional stock by
      the same Person is not considered to be a Change in
    Control;

                  


          

          


          
            	
                     
      

                  	
                    (ii)

                  	
                    On
      the date a majority of members of the Board is replaced during any
      12-month period by directors whose appointment or election is not endorsed
      by a majority of the Board before the date of the appointment or election;
      or

                  


          

          


          
            	
                     
      

                  	
                    (iii)

                  	
                    On
      the date any Person acquires (or has acquired during the 12-month period
      ending on the date of the most recent acquisition by such Person) assets
      from the Company that have a total gross fair market value equal to or
      more than 80 percent of the total gross fair market value of all of the
      assets of the Company immediately before such acquisition or
      acquisitions.  For this purpose, gross fair market value means
      the value of the assets of the Company or the value of the assets being
      disposed of, determined without regard to any liabilities associated with
      such assets.  However, there is no Change in Control when there
      is such a sale or transfer to (i) a stockholder of the Company
      (immediately before the asset transfer) in exchange for or with respect to
      the Company’s then outstanding stock; (ii) an entity, at least 50 percent
      of the total value or voting power of the stock of which is owned,
      directly or indirectly, by the Company; (iii) a Person that owns, directly
      or indirectly, at least 50 percent of the total value or voting power of
      the outstanding stock of the Company; or (iv) an entity, at least 50
      percent of the total value or voting power of the stock of which is owned,
      directly or indirectly, by a Person that owns, directly or indirectly, at
      least 50 percent of the total value or voting power of the outstanding
      stock of the Company.

                  


          

          


          
            	
                     
      

                  	
                    (iv)

                  	
                    For
      purposes of (i), (ii) and (iii) of this Section
  2(f),

                  


          

          


          
            	
                     
      

                  	
                    (A)

                  	
                    “Affiliate”
      shall have the meaning set forth in Rule 12b-2 promulgated under Section
      12 of the Securities Exchange Act of 1934, as
  amended;

                  


          

          


          
            	
                     
      

                  	
                    (B)

                  	
                    “Person”
      shall have the meaning given in Section 7701(a)(1) of the
      Code.  Person shall include more than one Person acting as a
      group as defined by the Final Treasury Regulations issued under Section
      409A of the Code; and

                  


          

          


          
            	
                     
      

                  	
                    (C)

                  	
                    “Subsidiary”
      means any entity whose assets and net income are included in the
      consolidated financial statements of the Company audited by the Company’s
      independent auditors and reported to stockholders in the annual report to
      stockholders.

                  


          

          


          
            	
                     
      

                  	
                    (v)

                  	
                    Notwithstanding
      the foregoing, in no case will an event in (i), (ii) or (iii) of this
      Section 2(f) be treated as a Change in Control unless such event also
      constitutes a “change in control event” with respect to the Company within
      the meaning of Treas. Reg. § 1.409A-3(i)(5) or any successor
      provision.

                  


          

           

              (g) “Code” shall mean the Internal
Revenue Code of 1986, as amended from time to time.

           

              (h) “Committee” shall mean a
committee of the Board designated by the Board to administer the
Plan.  Unless otherwise determined by the Board, the Compensation
Committee designated by the Board shall be the Committee under the
Plan.

           

              (i) “Company” shall mean Texas
Instruments Incorporated, together with any successor thereto.

           

              (j) “Cycle Time” shall mean the
actual time a specific process relating to a product or service of the Company
takes to accomplish.

           

              (k) “Earnings Before Income Taxes”
shall mean income from continuing operations plus provision for income
taxes.

           

              (l) “Earnings Before Income Taxes,
Depreciation and Amortization” or “EBITDA” shall mean income from
continuing operations plus 1) provision for income taxes, 2) depreciation
expense and 3) amortization expense.

           

              (m) “Earnings Per Share” for a
period shall mean diluted earnings per common share from continuing operations
before extraordinary items.

           

              (n) “Executive Group” shall mean
every person who is expected by the Committee to be both (i) a “covered
employee” as defined in Section 162(m) of the Code as of the end of the taxable
year in which an amount related to or arising in connection with the Award may
be deducted by the Company, and (ii) the recipient of taxable compensation of
more than $1,000,000 for that taxable year.

           

              (o) “Fair Market Value” shall mean,
with respect to any property (including, without limitation, any Shares or other
securities), the fair market value of such property determined by such methods
or procedures as shall be established from time to time by the
Committee.

           

              (p) “Free Cash Flow” for a period
shall mean net cash provided by operating activities of continuing operations
less additions to property, plant and equipment.

           

              (q) “Gross Profit” for a period
shall mean net revenue less cost of revenue.

           

              (r) “Gross Profit Margin” for a
period shall mean Gross Profit divided by net revenue.

           

              (s) “Incentive Stock Option” shall
mean an option granted under Section 6 that is intended to meet the
requirements of Section 422 of the Code, or any successor provision
thereto.

           

              (t) “Involuntary Termination”
shall mean a Termination of Employment, other than for cause, due to the
independent exercise of unilateral authority of TI to terminate the
Participant’s services, other than due to the Participant’s implicit or explicit
request, where the Participant was willing and able to continue to perform
services, in accordance with Treas. Reg. § 1.409A-1(n)(1) or any successor
provision.

           

              (u) “Manufacturing Process Yield”
shall mean the good units produced as a percent of the total units
processed.

           

              (v) “Market Share” shall mean the
percent of sales of the total available market in an industry, product line or
product attained by the Company or one or more of its business units, product
lines or products during a time period.

           

              (w) “Net Revenue Per Employee” in a
period shall mean net revenue divided by the average number of employees, with
average defined as the sum of the number of employees at the beginning and
ending of the period divided by two.

           

              (x) “Non-Qualified Stock Option”
shall mean an option granted under Section 6 that is not intended to be an
Incentive Stock Option.

           

              (y) “Option” shall mean an
Incentive Stock Option or a Non-Qualified Stock Option.

           

              (z) “Other Stock-Based Award” shall
mean any right granted under Section 10.

           

              (aa) “Participant” shall mean an
individual granted an Award under the Plan.

           

              (bb) “Performance Unit” shall mean
any right granted under Section 8.

           

              (cc) “Plan” shall mean this Texas
Instruments 2009 Long-Term Incentive Plan.

           

              (dd) “Operating Profit” shall mean
revenue less (i) cost of revenue, (ii) research and development expense and
(iii) selling, general and administrative expense.

           

              (ee) “Restricted Stock” shall mean
any Share granted under Section 7.

           

              (ff) “Restricted Stock Unit” shall
mean a contractual right granted under Section 7 that is denominated in Shares,
each of which represents a right to receive the value of a Share (or a
percentage of such value, which percentage may be higher than 100%) on the terms
and conditions set forth in the Plan and the applicable Award
Agreement.

           

              (gg) “Return on Assets” for a
period shall mean net income divided by average total assets, with average
defined as the sum of the amount of assets at the beginning and ending of the
period divided by two.

           

              (hh) “Return on Capital” for a
period shall mean net income divided by stockholders’ equity.

           

              (ii) “Return on Common Equity” for
a period shall mean net income divided by total stockholders’ equity, less
amounts, if any, attributable to preferred stock.

           

              (jj) “Return on Invested Capital”
for a period shall mean net income divided by the sum of stockholders’ equity
and long-term debt.

           

              (kk) “Return on Net Assets” for a
period shall mean net income divided by the difference of average total assets
less average non-debt liabilities, with average defined as the sum of assets or
liabilities at the beginning and ending of the period divided by
two.

           

              (ll) “Revenue Growth” shall mean
the percentage change in revenue from one period to another.

           

              (mm) “Shares” shall mean shares of
the common stock of the Company, $1.00 par value.

           

              (nn) “Specified Employee” shall
mean an employee who is a “specified employee” (as defined in Section
409A(2)(b)(i) of the Code) for the applicable period, as determined by the
Committee in accordance with Treas. Reg. § 1.409A-1(i) or any successor
provision.

           

              (oo) “Stock Appreciation Right” or
“SAR” shall mean any
right granted pursuant to Section 9 to receive, upon exercise by the
Participant, the excess of (i) the Fair Market Value of one Share on the
date of exercise or any date or dates during a specified period before the date
of exercise over (ii) the grant price of the right, which grant price,
except in the case of Substitute Awards, shall not be less than the Fair Market
Value of one Share on the date of grant of the right.

           

              (pp) “Substitute Awards” shall mean
Awards granted in assumption of, or in substitution for, outstanding awards
previously granted by a company acquired by the Company or with which the
Company combines.

           

              (qq) “Termination of Employment”
shall mean the date on which the Participant has incurred a “separation from
service” within the meaning of Treas. Reg. §  1.409A-1(h) or any
successor provision.

           

              (rr) “TI” shall mean and include
the Company and its Affiliates.

           

              (ss) “Total Stockholder Return”
shall mean the sum of the appreciation in stock price and dividends paid on
common stock over a given period of time.

           

              SECTION
3 .  Eligibility.

           

              (a) Any
individual who is employed by the Company or any Affiliate, and any individual
who provides services to the Company or any Affiliate as an independent
contractor, including any officer or employee-director, shall be eligible to be
selected to receive an Award under the Plan.

           

              (b) An
individual who has agreed to accept employment by, or to provide services to,
the Company or an Affiliate shall be deemed to be eligible for Awards hereunder
as of commencement of employment.

           

              (c) Directors
who are not full-time or part-time officers or employees are not eligible to
receive Awards hereunder.

           

              (d) Holders
of options and other types of Awards granted by a company acquired by the
Company or with which the Company combines are eligible for grant of Substitute
Awards hereunder.

           

              SECTION
4 .  Administration.

           

              (a) The Plan
shall be administered by the Committee.  The Committee shall be
appointed by the Board.  A director may serve as a member or alternate
member of the Committee only during periods in which the director is (i)
independent within the meaning of the rules of the New York Stock Exchange and
the Company’s director independence standards and (ii) an “outside director” as
described in Section 162(m) of the Code.

           

              (b) Subject
to the terms of the Plan and applicable law, the Committee shall have full power
and authority to: (i) designate Participants; (ii) determine the type or types
of Awards (including Substitute Awards) to be granted to each Participant under
the Plan; (iii) determine the number of Shares to be covered by (or with respect
to which payments, rights, or other matters are to be calculated in connection
with) Awards; (iv) determine the terms and conditions of any Award (v) determine
whether, to what extent, and under what circumstances Awards may be settled or
exercised in cash, Shares, other securities, other Awards, or other property, or
canceled, forfeited or suspended, and the method or methods by which Awards may
be settled, exercised, canceled, forfeited or suspended; (vi) determine,
consistent with Section 11(g), whether, to what extent, and under what
circumstances cash, Shares, other securities, other Awards, other property, and
other amounts payable with respect to an Award under the Plan shall be deferred
either automatically or at the election of the holder thereof or of the
Committee; (vii) interpret and administer the Plan and any instrument or
agreement relating to, or Award made under, the Plan; (viii) establish, amend,
suspend or waive such rules and regulations and appoint such agents as it shall
deem appropriate for the proper administration of the Plan, including adopting
sub-plans and addenda for Participants outside the United States to achieve
favorable tax results or facilitate compliance with applicable laws; (ix)
determine whether and to what extent Awards should comply or continue to comply
with any requirement of statute or regulation; and (x) make any other
determination and take any other action that the Committee deems necessary or
desirable for the administration of the Plan.

           

              (c) All
decisions of the Committee shall be final, conclusive and binding upon all
parties, including the Company, the stockholders and the
Participants.

           

              SECTION
5 .  Shares
Available for Awards.

           

              (a) Subject
to adjustment as provided in this Section 5, the number of Shares available for
issuance under the Plan shall be 75,000,000 shares.  Notwithstanding
the foregoing and subject to adjustment as provided in Section 5(e), no
Participant may receive Options and SARs under the Plan in any calendar year
that relate to more than 4,000,000 Shares.

           

              (b) If, after
the effective date of the Plan, (i) any Shares covered by an Award, or to which
such an Award relates, are forfeited or (ii) any Award expires or is cancelled
or otherwise terminated, then the number of Shares available for issuance under
the Plan shall increase, to the extent of any such forfeiture, expiration,
cancellation or termination.  For purposes of this Section 5(b),
awards and options granted under any previous option or long-term incentive plan
of the Company (other than a Substitute Award granted under any such plan) shall
be treated as Awards.  For the avoidance of doubt, the number of
Shares available for issuance under the Plan shall not be increased by:
(i) the withholding of Shares as a result of the net settlement of an
outstanding Option or SAR; (ii) the delivery of Shares to pay the exercise
price or withholding taxes relating to an Award; or (iii) the repurchase of
Shares on the open market using the proceeds of an Option’s
exercise.

           

              (c) Any
Shares underlying Substitute Awards shall not be counted against the Shares
available for granting Awards.

           

              (d) Any
Shares delivered pursuant to an Award may consist, in whole or in part, of
authorized and unissued Shares, of treasury Shares or of both.

           

              (e) In the
event that any dividend or other distribution (whether in the form of cash,
Shares, other securities, or other property), recapitalization, stock split,
reverse stock split, reorganization, merger, consolidation, split-up, spin-off,
combination, repurchase or exchange of Shares or other securities of the
Company, issuance of warrants or other rights to purchase Shares or other
securities of the Company, or other similar corporate transaction or event
affects the Shares such that an adjustment is appropriate in order to prevent
dilution or enlargement of the benefits or potential benefits intended to be
made available under the Plan, then the Committee shall equitably adjust any or
all of (i) the number and type of Shares (or other securities or property) which
thereafter may be made the subject of Awards, including the aggregate and
individual limits specified in Section 5(a), (ii) the number and type of Shares
(or other securities, cash or property) subject to outstanding Awards, and (iii)
the grant, purchase, or exercise price with respect to any Award or, if deemed
appropriate, make provision for a cash payment to the holder of an outstanding
Award; provided, however, that the number of
Shares subject to any Award denominated in Shares shall always be a whole
number.  Any such adjustment with respect to a “stock right”
outstanding under the Plan, as defined in Section 409A of the Code, shall be
made in a manner that is intended to avoid the imposition of any additional tax
or penalty under Section 409A.

           

              SECTION
6 .  Options.

           

              (a) The
Committee is hereby authorized to grant Options to Participants with the terms
and conditions described in this Section 6 and with such additional terms and
conditions, in either case not inconsistent with the provisions of the Plan, as
the Committee shall determine.

           

              (b) The
purchase price per Share under an Option shall be determined by the Committee;
provided, however, that, except in the
case of Substitute Awards, such purchase price shall not be less than the Fair
Market Value of a Share on the date of grant of such Option.

           

              (c) The term
of each Option shall be fixed by the Committee but shall not exceed 10 years;
provided, however, that
the Committee may provide for a longer term to accommodate regulations in
non-U.S. jurisdictions that require a minimum exercise or vesting period
following a Participant’s death to achieve favorable tax results or comply with
local law.

           

              (d) The
Committee shall determine the time or times at which an Option may be exercised
in whole or in part, and the method or methods by which, and the form or forms
(including, without limitation, cash, Shares, other Awards, or other property,
or any combination thereof, having a Fair Market Value on the exercise date
equal to the relevant exercise price) in which, payment of the exercise price
with respect thereto may be made or deemed to have been made.

           

              (e) The terms
of any Incentive Stock Option granted under the Plan shall comply in all
respects with the provisions of Section 422 of the Code, or any successor
provision thereto, and any regulations promulgated thereunder, but the Company
makes no representation that any options will qualify, or continue to qualify as
an Incentive Stock Option and makes no covenant to maintain Incentive Stock
Option status.

           

              SECTION
7 .  Restricted
Stock and Restricted Stock Units.

           

              (a) The
Committee is hereby authorized to grant Awards of Restricted Stock and
Restricted Stock Units to Participants with the terms and conditions described
in this Section 7 and with such additional terms and conditions, in either case
not inconsistent with the provisions of the Plan, as the Committee shall
determine.

           

              (b) Shares of
Restricted Stock and Restricted Stock Units shall be subject to such
restrictions as the Committee may impose (including, without limitation, any
limitation on the right to vote a Share of Restricted Stock or the right to
receive any dividend or other right or property), which restrictions may lapse
separately or in combination at such time or times, in such installments or
otherwise, as the Committee may deem appropriate.

           

              (c) Any share
of Restricted Stock granted under the Plan may be evidenced in such manner as
the Committee may deem appropriate including, without limitation, book-entry
registration or issuance of a stock certificate or certificates.  In
the event any stock certificate is issued in respect of shares of Restricted
Stock granted under the Plan, such certificate shall be registered in the name
of the Participant and shall bear an appropriate legend referring to the terms,
conditions, and restrictions applicable to such Restricted Stock.

             

              (d) Except as
otherwise determined by the Committee, upon termination of employment or
cessation of the provision of services (as determined under criteria established
by the Committee) for any reason during the applicable restriction period, all
Shares of Restricted Stock and all Restricted Stock Units still, in either case,
subject to restriction shall be forfeited and reacquired by the Company; provided, however, that the Committee
may, when it finds that a waiver would be in the best interests of the Company,
waive in whole or in part any or all remaining restrictions with respect to
Shares of Restricted Stock or Restricted Stock Units.

           

              SECTION
8 .  Performance
Units.

           

              (a) The
Committee is hereby authorized to grant Performance Units to Participants with
terms and conditions as the Committee shall determine not inconsistent with the
provisions of the Plan.

           

              (b) Subject
to the terms of the Plan, a Performance Unit granted under the Plan (i) may be
denominated or payable in cash, Shares (including, without limitation,
Restricted Stock), other securities, other Awards, or other property and (ii)
shall confer on the holder thereof rights valued as determined by the Committee
and payable to, or exercisable by, the holder of the Performance Unit, in whole
or in part, upon the achievement of such performance goals during such
performance periods as the Committee shall establish.  Subject to the
terms of the Plan, the performance goals to be achieved during any performance
period, the length of any performance period, the amount of any Performance Unit
granted and the amount of any payment or transfer to be made pursuant to any
Performance Unit shall be determined by the Committee.

           

              SECTION
9 .  Stock
Appreciation Rights (SARs).

           

              (a) The
Committee is hereby authorized to grant SARs to Participants with terms and
conditions as the Committee shall determine not inconsistent with the provisions
of the Plan.

           

              (b) The term
of each SAR shall be fixed by the Committee but shall not exceed 10 years; provided, however, that the
Committee may provide for a longer term to accommodate regulations in non-U.S.
jurisdictions that require a minimum exercise or vesting period following a
Participant’s death.

           

              SECTION
10 .  Other
Stock-based Awards.

           

              The Committee
is hereby authorized to grant to Participants such other Awards that are
denominated or payable in, valued in whole or in part by reference to, or
otherwise based on or related to, Shares (including, without limitation,
securities convertible into Shares) as are deemed by the Committee to be
consistent with the purposes of the Plan.  Subject to the terms of the
Plan, the Committee shall determine the terms and conditions of such
Awards.  Shares or other securities delivered pursuant to a purchase
right granted under this Section 10 shall be purchased for such consideration,
which may be paid by such method or methods and in such form or forms,
including, without limitation, cash, Shares, other securities, other Awards, or
other property, or any combination thereof, as the Committee shall determine,
the value of which consideration, as established by the Committee, shall, except
in the case of Substitute Awards, not be less than the Fair Market Value of such
Shares or other securities as of the date such purchase right is
granted.

           

              SECTION
11 .  General
Provisions Applicable to Awards.

           

              (a) Awards
shall be granted for no cash consideration or for such minimal cash
consideration as may be required by applicable law.

           

              (b) Awards
may, in the discretion of the Committee, be granted either alone or in addition
to or in tandem with any other Award or any award granted under any other plan
of the Company.  Awards granted in addition to or in tandem with other
Awards, or in addition to or in tandem with awards granted under any other plan
of the Company, may be granted either at the same time as or at a different time
from the grant of such other Awards or awards.

           

              (c) Subject
to the terms of the Plan, payments or transfers to be made by the Company upon
the grant, exercise or settlement of an Award may be made in such form or forms
as the Committee shall determine including, without limitation, cash, Shares,
other securities, other Awards, or other property, or any combination thereof,
and may be made in a single payment or transfer, in installments, or on a
deferred basis, in each case in accordance with Section 11(g) and rules and
procedures established by the Committee.  Such rules and procedures
may include, without limitation, provisions for the payment or crediting of
reasonable interest on installment or deferred payments or, with respect only to
Awards other than Options and SARs, the grant or crediting of dividend
equivalents in respect of installment or deferred payments.

           

              (d) Unless
the Committee shall otherwise determine, (i) no Award, and no right under
any such Award, shall be assignable, alienable, saleable or transferable by a
Participant otherwise than by will or by the laws of descent and distribution;
provided, however, that, if so
determined by the Committee, a Participant may, in the manner established by the
Committee, designate a beneficiary or beneficiaries to exercise the rights of
the Participant, and to receive any property distributable, with respect to any
Award upon the death of the Participant; (ii) each Award, and each right
under any Award, shall be exercisable during the Participant’s lifetime only by
the Participant or, if permissible under applicable law, by the Participant’s
guardian or legal representative; and (iii) no Award, and no right under
any such Award, may be pledged, alienated, attached, or otherwise encumbered,
and any purported pledge, alienation, attachment or encumbrance thereof shall be
void and unenforceable against the Company.  The provisions of this
paragraph shall not apply to any Award which has been fully exercised, earned or
paid, as the case may be, and shall not preclude forfeiture of an Award in
accordance with the terms thereof.

           

              (e) All
certificates for Shares or other securities delivered under the Plan pursuant to
any Award or the exercise thereof shall be subject to such stop transfer orders
and other restrictions as the Committee may deem advisable under the Plan or the
rules, regulations, and other requirements of the Securities and Exchange
Commission, any stock exchange upon which such Shares or other securities are
then listed, and any applicable Federal, state or foreign securities laws, and
the Committee may cause a legend or legends to be put on any such certificates
to make appropriate reference to such restrictions.

           

              (f) Every
Award (other than an Option or SAR) to a member of the Executive Group that the
Committee intends to constitute “qualified performance-based compensation” for
purposes of Section 162(m) of the Code shall include a pre-established formula,
such that payment, retention or vesting of the Award is subject to the
achievement during a performance period or periods, as determined by the
Committee, of a level or levels, on an absolute basis or relative to other
companies, as determined by the Committee, of one or more of the following
performance measures:  (i) Cash Flow, (ii) Cycle Time, (iii) Earnings
Before Income Taxes, (iv) Earnings Per Share, (v) EBITDA, (vi) Free Cash Flow,
(vii) Gross Profit, (viii) Gross Profit Margin, (ix) Manufacturing Process
Yield, (x) Market Share, (xi) net income, (xii) Net Revenue Per Employee, (xiii)
Operating Profit, (xiv) Return on Assets, (xv) Return on Capital, (xvi) Return
on Common Equity, (xvii) Return on Invested Capital, (xviii) Return on Net
Assets, (xix) Revenue Growth or (xx) Total Stockholder Return.  For
any Award subject to any such pre-established formula, no more than $5,000,000
can be paid in satisfaction of such Award to any Participant, provided, however, that if the performance
formula relating to such Award is expressed in Shares, the maximum limit shall
be 4,000,000 Shares in lieu of such dollar limit.

           

              (g) Unless
the Committee expressly determines otherwise in the Award Agreement, any Award
of an Option, SAR, or Restricted Stock is intended to qualify as a stock right
exempt under Section 409A of the Code, and the terms of the Award Agreement and
any related rules and procedures adopted by the Committee shall reflect such
intention.  Unless the Committee expressly determines otherwise in the
Award Agreement, with respect to any other Award that would constitute deferred
compensation within the meaning of Section 409A of the Code, the Award Agreement
shall set forth the time and form of payment and the election rights, if any, of
the holder in a manner that is intended to avoid the imposition of additional
taxes and penalties under Section 409A.  The Company makes no
representation or covenant that any Award granted under the Plan will comply
with Section 409A.

           

              (h) The
Committee shall not have the authority to provide in any Award granted hereunder
for the automatic award of an Option upon the exercise or settlement of such
Award.

           

              (i) This
Section 11(i) applies with respect to Awards granted on or after January 1,
2010.   If a Participant experiences an Involuntary Termination
within 24 months after a Change in Control, then unless specifically provided to
the contrary in any Award Agreement or the Committee otherwise determines under
authority granted elsewhere in the Plan,

          
            (1)  Awards
held by the Participant shall become fully vested and exercisable, and any
restrictions applicable to the Awards shall lapse, upon the effective date of
such termination;

            
              (2)  to
the extent permitted without additional tax or penalty by Section 409A of the
Code, the shares underlying Restricted Stock Units, Performance Units or other
Stock-Based Awards held by the Participant will be issued on, or as soon as
practicable (but no later than 60 days) after, the
Participant’s  Involuntary Termination, provided,
however,  that if the Participant is a Specified Employee upon such
termination, the shares will be issued on, or as soon as practicable (but no
more than 10 days) after, the first day of the seventh month following such
Involuntary Termination; and

              
                (3)  to
the extent that the issuance of shares as specified in (2) above is not
permitted without additional tax or penalty by Section 409A, the Award will
continue to full term and the shares will be issued at the issuance date
specified in the Award Agreement as if the Participant were still an employee of
TI on such date.

                 

                    SECTION
12 .  Amendment
and Termination.

                 

                    (a) Unless
otherwise expressly provided in an Award Agreement or in the Plan, the Board may
amend, alter, suspend, discontinue, or terminate the Plan or any portion thereof
at any time; provided,
however, that no such
amendment, alteration, suspension, discontinuation or termination shall be made
without (i) stockholder approval if such approval is necessary to comply
with the listing requirements of the New York Stock Exchange or (ii) the consent
of the affected Participants, if such action would adversely affect the rights
of such Participants under any outstanding Award.  Notwithstanding
anything to the contrary herein, the Committee may amend the Plan in such manner
as may be necessary to enable the Plan to achieve its stated purposes in any
jurisdiction outside the United States in a tax-efficient manner and in
compliance with local rules and regulations.

                 

                    (b) The
Committee may waive any conditions or rights under, or amend, alter, suspend,
discontinue or terminate, any Award theretofore granted, prospectively or
retroactively, without the consent of any relevant Participant or holder or
beneficiary of an Award, provided, however, that (i) no such
action shall impair the rights of any affected Participant or holder or
beneficiary under any Award theretofore granted under the Plan; (ii) except as
provided in Section 5(e), no such action shall reduce the exercise price of any
Option or SAR established at the time of grant thereof; and (iii) except in
connection with a corporate transaction involving the Company (including an
event described in Section 5(e), an Option or SAR may not be terminated in
exchange for (x) a cash amount greater than the excess, if any, of the Fair
Market Value of the underlying Shares on the date of cancellation over the
exercise price times the number of Shares outstanding under the Award (the
“Award Value”), (y) another Option or SAR with an exercise price that is less
than the exercise price of the cancelled Option or SAR, or (z) any other type of
Award.  For avoidance of doubt, in connection with a corporate
transaction involving the Company (including an event described in Section
5(e)), any Award may be terminated in exchange for a cash payment, and such
payment is not required to exceed the Award Value.  Notwithstanding
the foregoing, the Committee may terminate Awards granted in any jurisdiction
outside the United States prior to their expiration date for consideration
determined by the Committee when, in the Committee’s judgment, the
administrative burden of continuing Awards in such locality outweighs the
benefit to the Company.  Any such action taken with respect to an
Award intended to be a stock right exempt under Section 409A of the Code shall
be consistent with the requirements for exemption under Section 409A, and any
such action taken with respect to an Award that constitutes deferred
compensation under Section 409A shall be in compliance with the requirements of
Section 409A.  The Committee also may modify any outstanding Awards to
comply with Section 409A without consent from Participants.  The
Company makes no representation or covenant that any action taken pursuant to
this Section 12(b) will comply with Section 409A.

                 

                    (c) The
Committee shall be authorized to make adjustments in the terms and conditions
of, and the criteria included in, Awards in recognition of changes in applicable
laws, regulations or accounting principles, whenever the Committee determines
that such adjustments are appropriate in order to prevent dilution or
enlargement of the benefits or potential benefits intended to be made available
under the Plan.  Any such action taken with respect to an Award
intended to be a stock right exempt under Section 409A of the Code shall be
consistent with the requirements for exemption under Section 409A, and any such
action taken with respect to an Award that constitutes deferred compensation
under Section 409A shall be in compliance with the requirements of Section
409A.  However, the Company makes no representation or covenants that
Awards will comply with Section 409A.

                 

                    (d) The
Committee may correct any defect, supply any omission, or reconcile any
inconsistency in the Plan or any Award in the manner and to the extent it shall
deem desirable to carry the Plan into effect.

                 

                    SECTION
13 .  Miscellaneous.

                 

                    (a) No
employee, independent contractor, Participant or other person shall have any
claim to be granted any Award under the Plan, and there is no obligation for
uniformity of treatment of employees, independent contractors, Participants, or
holders or beneficiaries of Awards, either collectively or individually, under
the Plan.  The terms and conditions of Awards need not be the same
with respect to each recipient.

                 

                    (b) The
Committee may delegate to another committee of the Board, one or more officers
or managers of the Company, or a committee of such officers or managers, the
authority, subject to such terms and limitations as the Committee shall
determine, to grant Awards to, or to cancel, modify, waive rights with respect
to, alter, discontinue, suspend or terminate Awards held by, employees who are
not officers or directors of the Company for purposes of Section 16 of the
Securities Exchange Act of 1934, as amended; provided, however, that any such
delegation to management shall conform with the requirements of the General
Corporation Law of Delaware, as in effect from time to time.

                 

                    (c) The
Company shall be authorized to withhold from any Award granted or any payment
due or transfer made under any Award or under the Plan or from any compensation
or other amount owing to a Participant the amount (in cash, Shares, other
securities, other Awards, or other property) of withholding taxes (including
income tax, social insurance contributions, payment on account and other taxes)
due in respect of an Award, its exercise, or any payment or transfer of Shares,
cash or property under such Award or under the Plan and to take such other
action (including, without limitation, providing for elective payment of such
amounts in cash, Shares, other securities, other Awards or other property by the
Participant) as may be necessary in the opinion of the Company to satisfy all
obligations of the Company for the payment of such taxes.

                 

                    (d) Nothing
contained in the Plan shall prevent the Company from adopting or continuing in
effect other or additional compensation arrangements, and such arrangements may
be either generally applicable or applicable only in specific
cases.

                 

                    (e) The grant
of an Award shall not be construed as giving a Participant the right to be
retained in the employ or service of the Company or any
Affiliate.   Further, the Company or the applicable Affiliate may
at any time dismiss a Participant from employment or terminate the services of
an independent contractor, free from any liability, or any claim under the Plan,
unless otherwise expressly provided in the Plan or in any Award Agreement or in
any other agreement binding the parties.

                   

                    (f) If any
provision of the Plan or any Award is or becomes or is deemed to be invalid,
illegal, or unenforceable in any jurisdiction, or as to any person or Award, or
would disqualify the Plan or any Award under any law deemed applicable by the
Committee, such provision shall be construed or deemed amended to conform to
applicable laws, or if it cannot be so construed or deemed amended without, in
the determination of the Committee, materially altering the intent of the Plan
or the Award, such provision shall be stricken as to such jurisdiction, person
or Award, and the remainder of the Plan and any such Award shall remain in full
force and effect.

                 

                    (g) Neither
the Plan nor any Award shall create or be construed to create a trust or
separate fund of any kind or a fiduciary relationship between the Company and a
Participant or any other person.  To the extent that any person
acquires a right to receive payments from the Company pursuant to an Award, such
right shall be no greater than the right of any unsecured general creditor of
the Company.

                 

                    (h) No
fractional Shares shall be issued or delivered pursuant to the Plan or any
Award, and the Committee shall determine whether cash, other securities or other
property shall be paid or transferred in lieu of any fractional Shares, or
whether such fractional Shares or any rights thereto shall be canceled,
terminated or otherwise eliminated.

                 

                    SECTION
14 .  Effective
Date of the Plan.

                 

                    The Plan
shall be effective as of the date of its approval by the stockholders of the
Company.

                 

                    SECTION
15 .  Term
of the Plan.

                   

                    No Award
shall be granted under the Plan after the tenth anniversary of the effective
date.  However, unless otherwise expressly provided in the Plan or in
an applicable Award Agreement, any Award theretofore granted may extend beyond
such date, and the authority of the Committee and the Board under Section 12 to
amend, alter, adjust, suspend, discontinue, or terminate any such Award, or to
waive any conditions or rights under any such Award, and to amend the Plan,
shall extend beyond such date.

                   

                    SECTION
16 .  Governing
Law.

                 

                    The Plan
shall be construed in accordance with and governed by the laws of the State of
Texas without giving effect to the principles of conflict of laws
thereof.