Texas Instruments Incorporated Nonqualified Stock Option Agreement (Executive Officers) Form No. 2
Exhibit
10.2
Texas
Instruments Incorporated
(Executive
Officers)
Form
No. 2
2009
LTIP
Your
option is subject to the following terms and conditions, your acceptance of
which is required before you can exercise the option:
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1.
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Exercisability. On
or after the first anniversary of the Option Date (as defined in Section
9), during the balance of the option term, your option may be exercised
and shares purchased at any time or times under the following
conditions:
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(a)
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Installment
Table. Except as provided in Sections 1(b), 1(c) and
1(d), the option will be exercisable through the tenth anniversary of the
Option Date based on the following
table.
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On
or After
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Percent
Exercisable
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1st
anniversary of the Option Date
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25%
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2nd
anniversary of the Option Date
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50%
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3rd
anniversary of the Option Date
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75%
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4th
anniversary of the Option Date
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100%
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(b)
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Change in
Control: If there is a Change in Control (as defined in
Section 9), then Section 1(c) (except Section 1(c)(vii)) and the table in
Section 1(a) will not apply and, subject to the other terms and conditions
of this agreement, the option will be exercisable in full through the
tenth anniversary of the Option
Date.
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(c)
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Termination of
Employment. The effect of termination of employment from
TI (as defined in Section 9) is as
follows:
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(i)
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Termination for
cause: The option will be canceled immediately upon
termination.
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(ii)
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Death: The
option will continue to full term, becoming exercisable per the table in
Section 1(a), and will be exercisable by your
heirs.
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(iii)
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Permanent
disability: The option will continue to full term, becoming
exercisable per the table in Section
1(a).
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(iv)
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Termination (except
for cause), at least six months after the Option Date and when you are
retirement eligible (normal or early) either under the terms of the TI
401(k) or pension plan in your home country or the country in which you
work, as applicable (regardless of whether you are a participant in such
plan), or if there is no such plan, as may be set forth in the laws or
regulations in your home country or the country in which you work, as
applicable: The option will continue to full term,
becoming exercisable per the table in Section
1(a).
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(v)
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Termination (except
for cause) at least six months after the Option Date and after 20 years of
service (credited or otherwise) as a TI employee, but you are not
retirement eligible as described in Section
1(c)(iv): The option will continue to full term, but
will be exercisable only to the extent it was exercisable on the date of
termination.
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(vi)
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Other: For
any termination other than those specified above, the option will be
exercisable for 30 days after the date of termination, only to the extent
that it was exercisable on the date of termination per the table in
Section 1(a), except as follows: If you die within 30 days
after your termination, then your heirs may exercise the option for a
period of up to one year after your death, but only to the extent any
unexercised portion was exercisable on the date of
termination.
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(vii)
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If
your termination under Section 1(c)(v) or (vi) occurs within 30 days
before the effective date of a Change in Control, then the Change in
Control will be deemed to have occurred first and the option will be
exercisable in accordance with Section
1(b).
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(d)
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Confidential
Information and Competition. See Section 6, particularly
Section 6(c), for the effect of disclosure of confidential information or
of competition with TI.
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2.
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Continuing
Employment. Your option will not be affected by any
change of employment so long as you continue to be employed by
TI. The option will not constitute or be evidence of any
agreement or understanding, expressed or implied, on the part of TI to
employ you for any specific period.
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3.
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Transferability. Your
option is not transferable except by will or by the laws of descent and
distribution, and during your lifetime may be exercised only by
you.
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4.
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Manner of
Exercise. Your option may be exercised by delivery of a
written notice of exercise to the Secretary of the Company or the
Secretary’s designee, specifying the number of shares for which you wish
to exercise the option, and delivery of the full purchase price thereof,
in a form approved by the Compensation Committee of the Board of Directors
of the Company, to the Secretary or the Secretary’s designee, or in such
other manner as the Committee may otherwise from time to time
permit.
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5.
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Long-Term Incentive
Plan. Your option is subject to all of the terms and
conditions of the Texas Instruments 2009 Long-Term Incentive Plan
(hereinafter “the Plan”). In the event of any conflict between
such terms and conditions and those set forth herein, the terms of the
Plan shall govern and be determinative. It is expressly
intended that the definition of Change in Control contained in Section 9
shall supersede any definition of such term or similar term that may be
contained in the Plan.
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6.
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Confidential
Information and Competition. By accepting your option,
and in consideration for the option and for the Company’s obligations set
forth herein, you agree with the Company as
follows:
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(a)
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You
recognize and acknowledge that in the course of your employment with TI,
you have obtained private or confidential information and proprietary data
relating to TI, including but not limited to TI’s trade secrets
(hereinafter "Confidential Information"). TI agrees that it
will continue to provide you with access to its Confidential Information
to the extent necessary for you to carry out the duties of your employment
with TI.
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(b)
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You
agree not to use or disclose to third parties, either directly or
indirectly, Confidential Information at any time, except with the prior
written consent of TI. Without intending to limit the remedies
available to TI, you acknowledge that damages at law will be an
insufficient remedy to TI if you violate the terms of this Section 6(b)
and agree that TI may apply for and have injunctive relief in any court of
competent jurisdiction specifically to enforce the terms of this paragraph
upon the breach or threatened breach of any such terms or otherwise
specifically to enforce such terms.
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(c)
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You
agree that, if, during your employment and for a period of two years
thereafter you engage in Competition (as defined in Section 9), either
directly or indirectly, for your own benefit or on behalf of any other
person or entity, or if, at any time, you use or disclose to third parties
any Confidential Information without the written consent of the Company,
then (i) the option will not be thereafter exercisable at any time, and
(ii) you shall repay immediately to the Company any profit (spread between
Option Price and market price of the Company’s common stock on the date of
exercise) made on the option within three years prior to termination of
your employment or any time after termination of your
employment. Any amount payable to the Company pursuant to this
provision may be reduced or waived as the Company, in its sole judgment,
deems warranted by the
circumstances.
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(d)
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You
recognize and acknowledge that the provisions of this Section 6 relating
to nondisclosure and noncompetition during and after employment are
entered into by you in consideration of, and as a material inducement to,
the agreements by the Company herein as well as an inducement for the
Company to enter into this Option Agreement, and that, but for your
agreement to the provisions of this Section 6, the Company would not have
entered into this Agreement.
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7.
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Responsibility for
Taxes. You acknowledge that the ultimate liability for
income tax, social insurance or other tax-related withholding (hereinafter
“Tax-Related Items”) in connection with this grant, its exercise or the
subsequent sale of shares received thereunder is your responsibility, and
that TI (a) makes no representations or undertakings with respect to the
treatment for tax purposes of the grant or exercise of this option or sale
of shares received thereunder, or any dividends on issued shares, and (b)
does not commit to structure the grant to reduce your liability for
Tax-Related Items. You authorize TI to withhold all applicable
Tax-Related Items legally payable by you from your wages or other cash
compensation paid to you by TI or from proceeds of the sale of the
shares. If permissible under local law, TI may (a) sell or
arrange for the sale of shares that you acquire to meet the withholding
obligation for Tax-Related Items, and/or (b) withhold shares, provided
that TI only withholds the number of shares necessary to satisfy the
minimum withholding amount. Finally, you shall pay to TI any
amount of Tax-Related Items that TI may be required to withhold that
cannot be satisfied by the means described
above.
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8.
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Nature of
Grant. In accepting this grant, you acknowledge
that: (a) the Plan is established voluntarily by the Company,
it is discretionary in nature and it may be modified, amended, suspended
or terminated by the Company at any time, as provided in the Plan; (b) all
decisions with respect to future grants, if any, will be at the sole
discretion of the Company; (c) the grant of your option is voluntary and
occasional and does not create any contractual or other right to receive
future grants of options, or benefits in lieu of options; (d) you are
voluntarily participating in the Plan; (e) your option is an extraordinary
item that does not constitute compensation for services rendered to TI;
(f) your option is not part of normal or expected compensation or salary
for any purposes, including, but not limited to, calculating any
severance, termination, pension or retirement benefits or similar
payments; (g) the option grant will not be interpreted to form an
employment contract or relationship with TI; (h) the future value of the
underlying shares is unknown and cannot be predicted with certainty; and
(i) the value of any shares acquired upon exercise may increase or
decrease in value.
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9.
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Certain
Definitions.
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(a)
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The
term “Change in
Control” means an event 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 of the Company 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 Person, Affiliates,
Associates and Acquiring Person shall have the meanings given to such
terms in the Rights Agreement dated as of June 18, 1998, between the
Company and Xxxxxx Trust and Savings
Bank.
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(b)
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(c)
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The term “Competition”
means:
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(i)
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engaging
in any business activity similar to that in which you engaged during your
last three years of employment with TI for any person or entity selling,
marketing, designing or manufacturing products the same as, similar to, or
that compete with products that TI sells or markets in any area that TI
sells or markets such products;
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(ii)
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engaging
in the selling or marketing of any products that are the same as, similar
to, or that compete with any products that you sold or marketed, or
attempted to sell or market, during the last three years of your
employment with TI in any area in which you sold or marketed, or attempted
to sell or market, such products;
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(iii)
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engaging
in the manufacture or design of any products that are the same as, similar
to or that compete with any products that you sold or marketed, or
attempted to sell or market, or participated in the design or manufacture
of, during the last three years of your employment with TI;
or
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(iv)
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engaging
in the selling or marketing of any products that are the same as, similar
to, or that compete with any products that you participated in the design
or manufacture of during the last three years of your employment with TI
in any area in which TI has sold or marketed, or attempted to sell or
market, such products.
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(d)
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The
term “Option
Date” means the effective date of grant of this
option.
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10.
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11.
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Severability. The
provisions of this Agreement are severable and if any one or more
provisions are determined to be illegal or otherwise unenforceable, in
whole or in part, the remaining provisions shall nevertheless be binding
and enforceable.
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END
By
accepting this option agreement, I acknowledge I have read and I agree to be
bound by all of the terms and conditions set forth above, including Section 6
relating to Confidential Information and
Competition.
