2018 Proxy Statement

TEXTRON 2018 PROXY STATEMENT 46 NAMED EXECUTIVE OFFICER WHO TERMINATED EMPLOYMENT DURING 2017 For Cheryl H. Johnson who was retirement eligible at the time that she voluntarily terminated her employment with the Company during 2017, the following table shows payments made or expected to be made to her under existing agreements and plans, in addition to amounts disclosed in the Summary Compensation Table on page 34. Type of Compensation Annual Incentive / Severance $ 0 RSUs settled in stock (1) 1,046,489 Stock Options (1)(2) 419,632 Cash settlement of PSUs (1)(3) 738,952 3HQVLRQ EHQH¿W 2WKHU EHQH¿WV Amount Triggered due to Termination $3,939,652 $PRXQWV UHSRUWHG IRU 568V VWRFN RSWLRQV DQG 368V UHÀHFW DFFHOHUDWHG DQG RU SURUDWHG YHVWLQJ LQ WKH FDVH RI 568V LVVXHG SULRU WR DQG FRQWLQXHG vesting triggered by Ms. Johnson’s termination of employment. $PRXQWV UHÀHFW WKH LQWULQVLF YDOXH RI RXWVWDQGLQJ XQYHVWHG RSWLRQV DW WKH HQG RI WKH ¿VFDO \HDU 0V -RKQVRQ¶V XQYHVWHG VWRFN RSWLRQV ZLOO FRQWLQXH WR vest per their respective vesting schedules. 368 DPRXQWV KDYH EHHQ FDOFXODWHG DVVXPLQJ WKDW WKH 368 F\FOH ZLOO EH SDLG DW RI WDUJHW DQG WKH 368 F\FOH ZLOO EH SDLG DW RI WDUJHW 7KHVH ¿JXUHV DUH EDVHG RQ DFWXDO &RPSDQ\ SHUIRUPDQFH DJDLQVW JRDOV IRU DQG DQG WDUJHW &RPSDQ\ SHUIRUPDQFH DJDLQVW JRDOV IRU DQG ,Q DGGLWLRQ WKH ¿JXUHV DVVXPH PHGLDQ WRWDO VKDUHKROGHU UHWXUQ SHUIRUPDQFH RYHU HDFK \HDU 368 F\FOH (4) Includes a $65,466 distribution from Ms. Johnson’s previously vested DIP and a $32,127 distribution from Ms. Johnson’s previously vested SSP. PAY RATIO :H DUH UHTXLUHG E\ WKH 'RGG )UDQN :DOO 6WUHHW 5HIRUP DQG &RQVXPHU 3URWHFWLRQ $FW DQG 6HFXULWLHV DQG ([FKDQJH &RPPLVVLRQ ³6(&´ UXOHV WR SURYLGH WKH UDWLR RI WKH DQQXDO WRWDO FRPSHQVDWLRQ RI 0U 'RQQHOO\ RXU &KLHI ([HFXWLYH 2I¿FHU WR WKDW RI DQ employee whose annual compensation is at the median of all our employees. Textron and its consolidated subsidiaries together have approximately 37,000 employees located throughout the world, with approximately 74% in the U.S., 15% in Europe, 6% in Canada and Mexico combined, 4% in Asia and 1% elsewhere. To identify WKH HPSOR\HH ZLWK FRPSHQVDWLRQ DW WKH PHGLDQ RI DOO HPSOR\HHV IRU RXU ¿VFDO \HDU ZH XVHG ³DQQXDO UDWH´ DV UHÀHFWHG LQ RXU HQWHUSULVH ZLGH KXPDQ UHVRXUFHV LQIRUPDWLRQ V\VWHP DV RI 2FWREHU IRU DOO RI RXU HPSOR\HHV LQFOXGLQJ SDUW WLPH WHPSRUDU\ DQG VHDVRQDO HPSOR\HHV 7KH DQQXDO UDWH IRU VDODULHG HPSOR\HHV UHÀHFWV EDVH VDODU\ SDLG RQ DQ DQQXDO EDVLV )RU KRXUO\ HPSOR\HHV WKH DQQXDO UDWH LV DUULYHG DW XVLQJ WKHLU KRXUO\ UDWH DQG VWDQGDUG ZRUN KRXUV :H GLG QRW PDNH DQ\ FRVW RI living adjustments despite the large variety of labor markets in which our employees work, nor did we make any adjustments to account for the variety of compensation arrangements used to pay employees in varying roles (e.g., we did not include overtime, FRPPLVVLRQV ERQXVHV RU RWKHU W\SHV RI QRQ ¿[HG FRPSHQVDWLRQ 8VLQJ WKLV PHWKRGRORJ\ ZH GHWHUPLQHG WKDW WKH ³PHGLDQ HPSOR\HH´ ZDV D IXOO WLPH KRXUO\ HPSOR\HH ORFDWHG LQ WKH 8 6 ZLWK WRWDO FRPSHQVDWLRQ IRU WKH ¿VFDO \HDU LQ WKH DPRXQW RI ³$QQXDO WRWDO FRPSHQVDWLRQ´ RI WKH PHGLDQ HPSOR\HH LQFOXGHV regular and overtime earnings, any applicable annual bonus payment, Company contributions to a 401(k) plan on behalf of the HPSOR\HH DQG WKH &RPSDQ\ SDLG SRUWLRQ RI KHDOWK DQG ZHOIDUH EHQH¿WV ³$QQXDO WRWDO FRPSHQVDWLRQ´ IRU 0U 'RQQHOO\ IRU WKH ¿VFDO \HDU ZDV ZKLFK LV D LQFUHDVH RYHU WKH DPRXQW UHÀHFWHG LQ WKH 7RWDO FROXPQ LQ WKH 6XPPDU\ &RPSHQVDWLRQ 7DEOH DERYH 7KH LQFUHDVH UHÀHFWV WKH LQFOXVLRQ RI 0U 'RQQHOO\¶V KHDOWK DQG ZHOIDUH EHQH¿WV ZKLFK DUH H[FOXGHG IURP WKH 6XPPDU\ &RPSHQVDWLRQ 7DEOH DPRXQWV XQGHU 6(& UXOHV Based upon this information, for 2017 the ratio of the annual total compensation of Mr. Donnelly to the annual total compensation of the median employee was 165 to 1.