##### Table of Contents





UNITED STATES
 SECURITIES AND EXCHANGE
    COMMISSION
 Washington, D.C.
    20549
    FORM 10-K
  (x)

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended January 1,
    2011OR( )

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
    THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period from
    
    to   Commission file number
    001-15515
  Textron Financial
    Corporation
 (Exact Name of Registrant as
    Specified in Its Charter)
   Delaware

05-6008768(State or Other Jurisdiction of
    Incorporation or Organization)

(I.R.S. Employer
    Identification No.)40 Westminster Street, Providence, R.I.(Address of Principal Executive
    Offices)

02903(Zip Code)   Registrants telephone number,
    including area code:
    (401) 621-4200
  Securities registered pursuant to Section 12(b) of the
    Act:
  Name of Each Exchange onTitle of Class

Which Registered$100,000,000 5.125% Notes
    due August 15, 2014

New York Stock Exchange    Securities registered pursuant to Section 12(g) of the
    Act:
 Common Stock, $100.00 par value
   X
  X
   X
   Regulation S-T
   Regulation S-K Form 10-K Form 10-K.
   Rule 12b-2
 Large
    accelerated filer
    Accelerated filer
    Non-accelerated filer X
    Smaller reporting company (Do not check if a smaller
    reporting company)
   Rule 12b-2  X
     REGISTRANT
    MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION I (1)
    (a) AND (b) OFFORM 10-K
    AND IS THEREFORE FILING THIS FORM WITH THE REDUCED
    DISCLOSURE FORMAT




---



##### 





TABLE OF
    CONTENTS
   
 PART I.Item 1.


Business


3Item 1A.


Risk Factors


4Item 1B.


Unresolved Staff Comments


7Item 2.


Properties


7Item 3.


Legal Proceedings


7PART II.Item 5.


Market for Registrants Common Equity and
    Related Stockholder Matters


8Item 6.


Selected Financial Data


8Item 7.


Managements Discussion and Analysis of
    Financial Condition and Results of Operations


8Item 7A.


Quantitative and Qualitative Disclosure about
    Market Risk


10Item 8.


Financial Statements and Supplementary Data


13Item 9.


Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure


50Item 9A.


Controls and Procedures


50Item 9B.


Other Information


50PART III.Item 10.


Directors and Executive Officers of the
    Registrant


50Item 11.


Executive Compensation


50Item 12.


Security Ownership of Certain Beneficial Owners
    and Management


50Item 13.


Certain Relationships and Related Transactions


50Item 14.


Principal Accounting Fees and Services


51PART IV.Item 15.


Exhibits, Financial Statement Schedules


51EX-12EX-23EX-24EX-31.1EX-31.2EX-32.1EX-32.2   -2-




---



##### Table of Contents



PART I.  Item 1.
    Business  General
    E-Z-GO
    Form 10-K.
  Form 10-K.
  Available
    Information
  http://www.textronfinancial.com Form 10-K, Form 10-Q, Form 8-K,
  Forward-looking
    Information
   -3-




---



##### Table of Contents




    Changes in worldwide economic, political or regulatory
    conditions that impact interest and foreign exchange rates;
    The ability to maintain portfolio credit quality and to realize
    full value of finance receivables and of assets acquired upon
    foreclosure of finance receivables;
    The ability to control costs and successful implementation of
    various cost-reduction programs;
    Increases in pension expenses and employee medical benefits;
    The impact of changes in tax legislation;
    The ability to maintain certain minimum levels of financial
    performance as required by various debt covenants;
    Access to financing, including securitizations, at competitive
    rates;
    Access to equity in the form of retained earnings and capital
    contributions from Textron;
    Uncertainty in estimating contingent liabilities and
    establishing reserves to address such contingencies;
    Risks and uncertainties related to dispositions, including
    difficulties or unanticipated expenses in connection with the
    consummation of dispositions or the disruption of current plans
    and operations;
    The ability to successfully exit the non-captive portion of our
    business;
    Uncertainty in estimating the market value of our Finance
    receivables held for sale and our Allowance for losses on
    finance receivables held for investment;
    Bankruptcy or other financial problems at major customers that
    could cause disruptions or difficulty in collecting amounts owed
    by such customers;
    Legislative or regulatory actions impacting our operations; and
    Continued volatility in the economy resulting in a prolonged
    downturn in the markets in which we do business.  Item 1A.
    Risk
    Factors    We may
    not be able to continue to execute the liquidation of our
    Non-captive Finance segment at a favorable pace and level of
    recovery.
  and/or
 -4-




---



##### Table of Contents



mark-to-market and/or mark-to-market and/or
  Difficult
    conditions in the financial markets have adversely affected the
    quality of our finance asset portfolios, and our losses may
    increase if we are unable to successfully collect our finance
    receivables or realize sufficient value from
    collateral.
    Failure
    to maintain investment grade credit ratings acceptable to
    investors may increase the cost of our funding and may adversely
    affect our access to the capital markets.
    Our
    ability to fund our Captive Finance segment activities at
    economically competitive levels depends on our ability to borrow
    and the cost of borrowing in the credit markets.
   -5-




---



##### Table of Contents



If we
    fail to comply with the covenants contained in our various debt
    agreements, it may adversely affect our liquidity, results of
    operations and financial condition.
        We may
    need to obtain financing in order to meet our debt obligations
    in the future; such financing may not be available to us on
    satisfactory terms, if at all.
    The
    levels of our reserves are subject to many uncertainties and may
    not be adequate to cover writedowns or losses.
  and/or held-for-sale
 -6-




---



##### Table of Contents



We are
    subject to legal proceedings and other claims.
    Unanticipated
    changes in our tax rates or exposure to additional income tax
    liabilities could affect our profitability.
  non-U.S. jurisdictions,
  Item 1B.
    Unresolved
    Staff Comments    Item 2.
    Properties  Form 10-K.
  Item 3.
    Legal
    Proceedings     -7-




---



##### Table of Contents



PART II.  Item 5.
    Market
    for Registrants Common Equity and Related Stockholder
    Matters  Form 10-K.
  Item 6.
    Selected
    Financial Data  Form 10-K.
  Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations   Financial
    Condition
  Liquidity
    and Capital Resources
         -8-




---



##### Table of Contents



Results
    of Operations
  Revenues
    2010vs. 2009(In millions)Lower average finance receivables of $2.0 billion

$
(114
)Lower gains on debt extinguishment


(54
)Impact of variable-rate receivable interest rate floors


(26
)Decrease in servicing and investment income related to
    securitizations


(24
)Lower accretion of valuation allowance


(16
)Lower other income


(15
)Suspended earnings on nonaccrual finance receivables


(10
)Lower portfolio losses, net of gains


81Lower securitization losses, net of gains


28   Loss
    before Income Taxes and Noncontrolling Interest
    2010vs. 2009(In millions)Lower average finance receivables of $2.0 billion

$
(59
)Lower gains on debt extinguishment


(54
)Impact of variable-rate receivable interest rate floors


(26
)Decrease in servicing and investment income related to
    securitizations


(24
)Lower accretion of valuation allowance


(16
)Lower other income


(15
)Interest expense rate impact


(14
)Suspended earnings on nonaccrual finance receivables


(10
)Decrease in the provision for loan losses


123Lower portfolio losses, net of gains


81Lower operating and administrative expenses


41Lower securitization losses, net of gains


28Increase in special charges


(89
)      -9-




---



##### Table of Contents



Item 7A.
    Quantitative
    and Qualitative Disclosure about Market Risk  Risk
    Management
    
    Credit risk;
    Asset/liability risk (including interest rate and foreign
    exchange risk); and
    Liquidity risk.    Credit
    Risk Management
    
    Underwriting procedures;
    Centralized approval of individual transactions exceeding
    certain size limits; and
    Active portfolio and account management.    
    Analyzing business or property cash flows and collateral values;
    Performing financial sensitivity analyses; and
    Assessing potential exit strategies.     -10-




---



##### Table of Contents



Geographic
    Concentration
  Form 10-K.
  Asset/Liability
    Risk Management
    
    Interest rate exposure arising from changes in interest rate
    indices; and
    Foreign currency exposure arising from changes in exchange rates.      Interest
    Rate Risk Management
    Foreign
    Exchange Risk Management
   -11-




---



##### Table of Contents



Liquidity
    Risk Management
    
    Collection of existing finance receivables;
    Committed bank lines of credit;
    Sales of finance receivables classified as held for sale;
    Syndication and securitization of finance receivables;
    Other forms of secured financing;
    Unsecured term loans; and
    Intercompany borrowings from Textron.  Interest
    Rate Sensitivity
     -12-




---



##### Table of Contents



Item 8.
    Financial
    Statements and Supplementary Data  REPORT OF
    MANAGEMENT
  Form 10-K. Rules 13a-15(f).
      
      
       -13-




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  The Board of Directors
 Textron Financial Corporation
              
   -14-




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  The Board of Directors
 Textron Financial Corporation
          
   -15-




---



##### Table of Contents



CONSOLIDATED
    STATEMENTS OF OPERATIONS
    2010


2009


2008(In millions)Finance charges

$
268


$
434


$
558Portfolio losses, net of gains


(81
)


(162
)


(5
)Rental revenues on operating leases


27



30



34Gains on early extinguishment of debt


1



55



Securitization (losses) gains:Total
    other-than-temporary
    impairments






(39
)


(21
)Portion of
    other-than-temporary
    impairments recognized in Other comprehensive loss, before
    income taxes






13



Net
    other-than-temporary
    impairments recognized in securitization (losses) gains






(26
)


(21
)Other securitization (losses) gains






(2
)


63Total securitization (losses) gains






(28
)


42Other (loss) income


(8
)


31



94Total revenues


207



360



723Interest expense


118



159



307Depreciation of equipment on operating leases


17



18



18Net interest margin


72



183



398Operating and administrative expenses


169



210



214Provision for losses


142



265



234Special charges


102



13



489Loss before income taxes and noncontrolling interest


(341
)


(305
)


(539
)Income tax benefit


(111
)


(100
)


(78
)Net loss before noncontrolling interest


(230
)


(205
)


(461
)Noncontrolling interest, net of income taxes






(2
)


Net loss

$
(230
)

$
(203
)

$
(461
)    -16-




---



##### Table of Contents



CONSOLIDATED
    BALANCE SHEETS
  January 1,


January 2,2011


2010(In millions)AssetsCash and equivalents

$
33


$
144Finance receivables held for investment, net of unearned income:Installment contracts


1,773



2,327Mortgage loans


859



1,073Revolving loans


501



1,137Leveraged leases


279



313Finance leases


262



403Distribution finance receivables


182



771Total finance receivables held for investment


3,856



6,024Allowance for losses on finance receivables held for investment


(339
)


(339
)Finance receivables held for investment  net


3,517



5,685Finance receivables held for sale


413



819Equipment on operating leases  net


177



216Other assets


430



460Total assets

$
4,570


$
7,324Liabilities and Shareholders EquityLiabilitiesAccrued interest and other liabilities

$
270


$
423Amounts due to Textron Inc.


254



472Deferred income taxes


110



137Debt


3,435



5,488Total liabilities


4,069



6,520Shareholders EquityCapital surplus


1,870



1,487Subsidiary preferred stock


1



1Investment in parent company preferred stock


(25
)


(25
)Accumulated other comprehensive loss






(49
)Retained deficit


(1,345
)


(610
)Total shareholders equity


501



804Total liabilities and shareholders equity

$
4,570


$
7,324    -17-




---



##### Table of Contents



CONSOLIDATED
    STATEMENTS OF CASH FLOWS
    2010


2009


2008(In millions)Cash flows from operating activities:Net loss

$
(230
)

$
(203
)

$
(461
)Net income attributable to noncontrolling interest






(2
)


Net loss before noncontrolling interest


(230
)


(205
)


(461
)Adjustments to reconcile net loss before noncontrolling interest
    to net cash (used) provided by operating activities:Provision for losses


142



265



234(Decrease) increase in taxes payable


(135
)


167



(25
)Portfolio losses


112



162



6Special charges, net of income tax


71



1



23Deferred income tax provision


(61
)


(203
)


(94
)Depreciation and amortization


30



36



40(Decrease) increase in accrued interest and other liabilities


(16
)


10



(41
)Valuation allowance on finance receivables held for sale


8



(15
)


293Gains on early extinguishment of debt


(1
)


(30
)


Goodwill impairment










169Other  net


36



11



23Net cash (used) provided by operating activities


(44
)


199



167Cash flows from investing activities:Finance receivables originated or purchased


(666
)


(3,558
)


(11,879
)Finance receivables repaid


2,324



4,801



11,245Proceeds from receivable sales, including securitizations


670



728



631Proceeds from disposition of other assets, including repossessed
    assets and properties and operating leases


151



236



40Collection of retained interests in securitizations






117



15Other investments


17



11



(116
)Net cash provided (used) by investing activities


2,496



2,335



(64
)Cash flows from financing activities:Principal payments on long-term debt


(1,730
)


(2,498
)


(1,307
)Proceeds from issuance of long-term debt










1,161Principal payments on line of credit


(300
)






Proceeds from line of credit






1,740



Principal payments on secured debt


(225
)


(1,092
)


Proceeds from issuance of secured debt


166



143



300Principal payments on nonrecourse debt


(136
)


(180
)


(267
)Net (decrease) increase in intercompany loan due to Textron
    Inc.


(218
)


311



133Net decrease in commercial paper






(743
)


(668
)Capital contributions from Textron Inc.


392



279



634Dividends paid to Textron Inc.


(514
)


(358
)


(151
)Other  net






(22
)


19Net cash used by financing activities


(2,565
)


(2,420
)


(146
)Effect of exchange rate changes on cash


2



14



(1
)Net (decrease) increase in cash and equivalents


(111
)


128



(44
)Cash and equivalents at beginning of year


144



16



60Cash and equivalents at end of year

$
33


$
144


$
16    -18-




---



##### Table of Contents



CONSOLIDATED
    STATEMENTS OF CHANGES IN EQUITY
    InvestmentIn Parent







Accumulated







TotalCompany



Subsidiary



Other



Retained



Share-



Non-Capital



Preferred



Preferred



Comprehensive



Earnings



holders



controlling



TotalSurplus



Stock



Stock



Income (Loss)



(Deficit)



Equity



Interest



Equity(In millions)Balance December 29, 2007


$
592



$
(25
)


$




$
26



$
545



$
1,138



$




$
1,138Comprehensive loss:Net loss























(461
)



(461
)








(461
)Other comprehensive loss:Foreign currency translation, net of income taxes


















(79
)








(79
)








(79
)Change in unrealized net losses on hedge contracts, net of
    income taxes


















(1
)








(1
)








(1
)Change in unrealized net gains on interest-only securities, net
    of income taxes


















(1
)








(1
)








(1
)Other comprehensive loss


















(81
)








(81
)








(81
)Comprehensive loss




























(542
)








(542
)Capital contributions from Textron Inc.



634
























634









634Dividends to Textron Inc.



(9
)


















(142
)



(151
)








(151
)Balance January 3, 2009



1,217




(25
)








(55
)



(58
)



1,079









1,079Comprehensive loss:Net loss























(203
)



(203
)



(2
)



(205
)Other comprehensive income:Foreign currency translation, net of income taxes


















7









7









7Change in unrealized net losses on retained interests, net of
    income taxes


















(1
)








(1
)








(1
)Other comprehensive income


















6









6









6Comprehensive loss




























(197
)



(2
)



(199
)Capital contributions from Textron Inc.



279
























279









279Dividends to Textron Inc.



(9
)


















(349
)



(358
)








(358
)Sale of subsidiary preferred stock













1














1









1Sale of noncontrolling interest

































21




21Repurchase of noncontrolling interest

































(19
)



(19
)Balance January 2, 2010



1,487




(25
)



1




(49
)



(610
)



804









804Comprehensive loss:Net loss























(230
)



(230
)








(230
)Other comprehensive loss:Foreign currency translation, net of income
    taxes(1)


















46









46









46Change in unrealized net losses on hedge contracts, net of
    income taxes


















3









3









3Other comprehensive income


















49









49









49Comprehensive loss




























(181
)








(181
)Capital contributions from Textron Inc.



392
























392









392Dividends to Textron Inc.



(9
)


















(505
)



(514
)








(514
)Balance January 1, 2011


$
1,870



$
(25
)


$
1



$




$
(1,345
)


$
501



$




$
501   (1)
   -19-




---



##### Table of Contents



NOTES TO
    THE CONSOLIDATED FINANCIAL STATEMENTS
  NOTE 1Summary of Significant Accounting Policies
  Nature of
    Operations
    E-Z-GO
      Principles
    of Consolidation
    Use of
    Estimates
   -20-




---



##### Table of Contents



Finance
    Charges
      Allowance
    for Losses on Finance Receivables Held for Investment
    Aviation
    Golf
    Equipment
    Timeshare
    Golf
    Mortgage
   -21-




---



##### Table of Contents



Distribution
    Finance
        Aviation
    Golf
    Equipment
    Timeshare
    Golf
    Mortgage
    Distribution
    Finance
   -22-




---



##### Table of Contents



Finance
    Receivable Origination Fees and Costs
    Other
    (Loss) Income
    Portfolio
    Losses, net of Gains
    Fixed
    Assets
    Equipment
    on Operating Leases
    Pension
    Benefits and Postretirement Benefits Other than
    Pensions
    Income
    Taxes
   -23-




---



##### Table of Contents



Derivative
    Financial Instruments
        Fair
    Value of Financial Instruments
    Finance
    Receivables Held for Sale
  and/or and/or
 -24-




---



##### Table of Contents



Cash and
    Equivalents
    NOTE 2Special Charges
    2010


2009


2008Non-Captive


Non-Captive


Captive


Non-CaptiveFinance


Finance


Finance


Finance


Total(In millions)Restructuring charges

$
11


$
13


$
4


$
23


$
27Other special charges


91















Valuation allowance on finance receivables held for sale














293



293Goodwill impairment










16



153



169Total Special charges

$
102


$
13


$
20


$
469


$
489   Restructuring
    Charges
    2010


2009


2008(In millions)Severance and pension curtailment costs

$
7


$
12


$
15Contract termination costs


3



1



1Asset impairments


1







11Total Restructuring charges

$
11


$
13


$
27  -25-




---



##### Table of Contents



Severance andPension


ContractCurtailment


Termination


AssetCosts


Costs


Impairments


Total(In millions)Balance at December 29, 2007

$



$



$



$
Additions


15



1



11



27Cash Paid


(4
)










(4
)Non-cash utilization










(11
)


(11
)Balance at January 3, 2009


11



1







12Additions


12



1







13Cash Paid


(10
)


(2
)






(12
)Balance at January 2, 2010


13











13Additions


7



3



1



11Cash Paid


(13
)


(1
)






(14
)Non-cash utilization










(1
)


(1
)Balance at January 1, 2011

$
7


$
2


$



$
9     Captive


Non-captiveFinance


Finance


Total(In millions)Severance and pension curtailment costs

$
1


$
33


$
34Non-cash asset impairments


3



9



12Contract termination costs






5



5Total Restructuring charges

$
4


$
47


$
51     Other
    Special charges
    Valuation
    Allowance on Finance Receivables Held for Sale
   -26-




---



##### Table of Contents



Goodwill
    Impairment
    NOTE 3Relationship with Textron Inc.
        non-U.S. buyers.
   -27-




---



##### Table of Contents



NOTE 4Finance Receivables and Allowance for Losses on Finance
    Receivables Held for Investment
  Finance
    Receivables by Product Line / Receivable Class
    January 1, 2011


January 2, 2010(Dollars in millions)Captive FinanceAviation

$
1,763



41
%

$
2,353



34
%Golf Equipment


212



5
%


417



6
%Non-captive FinanceTimeshare


894



21
%


1,302



19
%Golf Mortgage


876



21
%


1,085



16
%Structured Capital


317



7
%


349



5
%Distribution Finance


120



3
%


1,076



16
%Other Liquidating


87



2
%


261



4
%Total finance receivables

$
4,269



100
%

$
6,843



100
%   E-Z-GO
     -28-




---



##### Table of Contents



Finance
    Receivables Concentrations
    January 1, 2011


January 2, 2010(Dollars in millions)United States:Southeast

$
1,021



24
%

$
1,579



23
%West


642



15
%


1,012



15
%Southwest


586



14
%


943



14
%Mideast


369



9
%


535



8
%Midwest


361



8
%


567



8
%Northeast


82



2
%


127



2
%Total United States

$
3,061



72
%

$
4,763



70
%Mexico


309



7
%


415



6
%South America


241



6
%


330



5
%Canada


170



4
%


669



10
%Other international


488



11
%


666



9
%Total finance receivables

$
4,269



100
%

$
6,843



100
%     January 1, 2011


January 2, 2010(Dollars in millions)General aviation

$
1,785



41
%

$
2,378



35
%Resort


894



21
%


1,327



19
%Golf


857



20
%


1,231



18
%Other


733



18
%


1,907



28
%Total finance receivables

$
4,269



100
%

$
6,843



100
%   Finance
    Receivables Held for Investment
       -29-




---



##### Table of Contents



Leveraged
    Leases
  January 1, 2011


January 2, 2010(In millions)Rental receivable

$
761


$
948Nonrecourse debt


(414
)


(570
)Estimated residual values of leased assets


128



152475



530Less unearned income


(196
)


(217
)Investment in leveraged leases


279



313Deferred income taxes


(219
)


(238
)Net investment in leveraged leases

$
60


$
75       2010


2009


2008(In millions)Income recognized

$
3


$
5


$
4Income tax expense


(1
)


(2
)


(1
)Income from leveraged leases

$
2


$
3


$
3   Credit
    Quality Indicators and Nonaccrual Finance Receivables
       -30-




---



##### Table of Contents



January 1, 2011


January 2, 2010Performing



Watchlist



Nonaccrual



Total


Performing


Watchlist



Nonaccrual



Total(Dollars in millions)Captive FinanceAviation


$
1,356



$
238



$
169



$
1,763


$
1,792


$
275



$
286



$
2,353Golf Equipment



138




51




23




212



243



74




16




333Non-captive FinanceTimeshare



222




77




382




681



450



474




378




1,302Golf Mortgage



163




303




219




685



386



249




254




889Distribution Finance



76




11




33




120



481



107




88




676Structured Capital



290




27









317



313



31




5




349Other Liquidating



54









24




78



52



57




13




122Total finance receivables held for investment


$
2,299



$
707



$
850



$
3,856


$
3,717


$
1,267



$
1,040



$
6,024% of total finance receivables held for investment



59.63
%



18.33
%



22.04
%



100.00
%


61.71
%


21.03
%



17.26
%



100.00
%     and/or
  January 1, 2011Total FinanceLess than









Greater than


Receivables31 Days



31-60 Days


61-90 Days


90 Days


Held forPast Due



Past Due


Past Due


Past Due


Investment(In millions)Captive FinanceAviation

$
1,607



$
67


$
41


$
48


$
1,763Golf Equipment


171




13



9



19



212Non-captive FinanceTimeshare


533




14



6



128



681Golf Mortgage


543




12



7



123



685Distribution Finance


98




1







21



120Structured Capital


317
















317Other Liquidating


68




1



1



8



78Total finance receivables held for investment

$
3,337



$
108


$
64


$
347


$
3,856   -31-




---



##### Table of Contents



January 2, 2010Total FinanceLess than









Greater than


Receivables31 Days



31-60 Days


61-90 Days


90 Days


Held forPast Due



Past Due


Past Due


Past Due


Investment(In millions)Captive FinanceAviation

$
2,077



$
102


$
96


$
78


$
2,353Golf Equipment


300




11



11



11



333Non-captive FinanceTimeshare


1,213




6







83



1,302Golf Mortgage


615




60



106



108



889Distribution Finance


590




20



3



63



676Structured Capital


344












5



349Other Liquidating


113




4



1



4



122Total finance receivables held for investment

$
5,252



$
203


$
217


$
352


$
6,024     Impaired
    Loans
     -32-




---



##### Table of Contents



January 1, 2011Unpaid





AverageRecorded


Principal


Related


RecordedInvestment


Balance


Allowance


Investment(In millions)Impaired loans with no related allowance for lossesCaptive FinanceAviation

$
17


$
21


$



$
14Golf Equipment














1Non-captive FinanceTimeshare


69



74







70Golf Mortgage


138



146







118Distribution Finance


10



15







46Other Liquidating


15



69







7Total

$
249


$
325


$



$
256Impaired loans with a related allowance for lossesCaptive FinanceAviation

$
147


$
144


$
45


$
187Golf Equipment


4



5



2



5Non-captive FinanceTimeshare


355



385



102



356Golf Mortgage


175



178



39



182Distribution Finance


11



11



2



18Other Liquidating


5



4



1



3Total

$
697


$
727


$
191


$
751Total Impaired loansCaptive FinanceAviation

$
164


$
165


$
45


$
201Golf Equipment


4



5



2



6Non-captive FinanceTimeshare


424



459



102



426Golf Mortgage


313



324



39



300Distribution Finance


21



26



2



64Other Liquidating


20



73



1



10Total

$
946


$
1,052


$
191


$
1,007   -33-




---



##### Table of Contents



January 2, 2010Unpaid





AverageRecorded


Principal


Related


RecordedInvestment


Balance


Allowance


Investment(In millions)Impaired loans with no related allowance for lossesCaptive FinanceAviation

$
39


$
39


$



$
37Golf Equipment














Non-captive FinanceTimeshare


142



137







82Golf Mortgage


84



86







94Distribution Finance


67



69







21Other Liquidating


17



16







6Total

$
349


$
347


$



$
240Impaired loans with a related allowance for lossesCaptive FinanceAviation

$
258


$
258


$
46


$
98Golf Equipment


3



3



1



1Non-captive FinanceTimeshare


354



366



59



234Golf Mortgage


179



179



32



96Distribution Finance


46



45



14



49Other Liquidating


7



8



1



7Total

$
847


$
859


$
153


$
485Total Impaired loansCaptive FinanceAviation

$
297


$
297


$
46


$
135Golf Equipment


3



3



1



1Non-captive FinanceTimeshare


496



503



59



316Golf Mortgage


263



265



32



190Distribution Finance


113



114



14



70Other Liquidating


24



24



1



13Total

$
1,196


$
1,206


$
153


$
725    -34-




---



##### Table of Contents



Allowance
    for Losses on Finance Receivables Held for Investment
    For the Year Ended January 1, 2011Allowance for losses on
    finance





Golf







Golf



Distribution



Structured



Otherreceivables held for
    investment

Aviation



Equipment



Timeshare



Mortgage



Finance



Capital



Liquidating



Total(In millions)Beginning balance

$
112



$
9



$
79



$
65



$
62



$




$
12



$
339Provision for losses


36




14




38




66




(18
)








6




142Less net charge-offs


44




7




7




52




23









5




138Transfers












(4
)























(4
)Ending balance

$
104



$
16



$
106



$
79



$
21



$




$
13



$
339Individually evaluated for impairment

$
45



$
2



$
102



$
39



$
2



$




$
1



$
191Collectively evaluated for impairment


59




14




4




40




19









12




148Ending balance

$
104



$
16



$
106



$
79



$
21



$




$
13



$
339Finance receivables held for investmentIndividually evaluated for impairment

$
164



$
4



$
424



$
313



$
21



$




$
20



$
946Collectively evaluated for impairment


1,599




208




257




372




99




38




58




2,631Ending balance

$
1,763



$
212



$
681



$
685



$
120



$
38



$
78



$
3,577   For the Year Ended January 2, 2010Allowance for losses on
    finance





Golf







Golf



Distribution



Structured



Otherreceivables held for
    investment

Aviation



Equipment



Timeshare



Mortgage



Finance



Capital



Liquidating



Total(In millions)Beginning balance

$
29



$
9



$
35



$
52



$
55



$




$
11



$
191Provision for losses


109




9




47




45




47









8




265Less net charge-offs


26




7




3




32




40









7




115Transfers







(2
)




























(2
)Ending balance

$
112



$
9



$
79



$
65



$
62



$




$
12



$
339Individually evaluated for impairment

$
46



$
1



$
59



$
32



$
14



$




$
1



$
153Collectively evaluated for impairment


66




8




20




33




48









11




186Ending balance

$
112



$
9



$
79



$
65



$
62



$




$
12



$
339Finance receivables held for investmentIndividually evaluated for impairment

$
297



$
3



$
496



$
263



$
113



$




$
24



$
1,196Collectively evaluated for impairment


2,056




330




806




626




563




36




98




4,515Ending balance

$
2,353



$
333



$
1,302



$
889



$
676



$
36



$
122



$
5,711   January 1,


January 2,2011


2010Allowance for losses on finance receivables held for investment
    as a percentage of finance receivables held for investment


8.80
%


5.63
%Allowance for losses on finance receivables held for investment
    as a percentage of nonaccrual finance receivables held for
    investment


39.92
%


32.62
%Allowance for losses on impaired nonaccrual finance receivables
    as a percentage of impaired nonaccrual finance receivables


23.82
%


15.57
%  -35-




---



##### Table of Contents



NOTE 5Equipment on Operating Leases
  January 1,


January 2,2011


2010(In millions)Equipment on operating leases, at cost:Aircraft

$
243


$
256Golf cars


22



26Accumulated depreciation:Aircraft


(81
)


(59
)Golf cars


(7
)


(7
)Equipment on operating leases  net

$
177


$
216      NOTE 6Other Assets
    January 1,


January 2,2011


2010(In millions)Repossessed assets and properties

$
157


$
119Operating assets received in satisfaction of troubled finance
    receivables


107



112Investment in other marketable securities


51



68Other long-term investments


50



54Derivative financial instruments


34



61Other


31



46Total other assets

$
430


$
460     and/or
   -36-




---



##### Table of Contents



other-than-temporarily
  NOTE 7Debt and Credit Facilities
  January 1,


January 2,2011


2010(In millions)Credit Line borrowings:Due 2012 (weighted-average rates of 0.91% and 0.91%,
    respectively)

$
1,440


$
1,740Long-term debt:Fixed-rate notesDue 2010 (weighted-average rate of 4.80%)






581Due 2011 (weighted-average rates of 4.95% and 4.96%,
    respectively)


203



218Due 2012 (weighted-average rates of 4.43% and 4.43%,
    respectively)


52



52Due 2013 (weighted-average rates of 5.18% and 5.19%,
    respectively)


453



478Due 2014 (weighted-average rates of 5.07% and 5.07%,
    respectively)


111



111Due 2015 (weighted-average rates of 4.59% and 4.59%,
    respectively)


10



10Due 2016 and thereafter (weighted-average rates of 5.11% and
    7.85%, respectively)


31



43Total fixed-rate notes


860



1,493Variable-rate notesDue 2010 (weighted-average rate of 0.60%)






1,054Due 2011 (weighted-average rates of 0.83% and 0.75%,
    respectively)


171



201Due 2013 (weighted-average rates of 1.18% and 1.16%,
    respectively)


100



100Total variable-rate notes


271



1,355Securitized on-balance sheet debt:Amortizing (weighted-average rates of 2.01% and 1.45%,
    respectively)


530



559Subordinated debt:Due 2042 and thereafter (6.00%)


300



300Unamortized discount


(1
)


(2
)Fair value adjustments


35



43Total long-term, securitized on-balance sheet and subordinated
    debt


1,995



3,748Total debt

$
3,435


$
5,488       Fixed-to-Floating
 -37-




---



##### Table of Contents



and/or
            NOTE 8Derivative Financial Instruments
   -38-




---



##### Table of Contents



Notional
    Amount            Fair
    Value AmountAssets


LiabilitiesJanuary 1,


January 2,



January 1,


January 2,


January 1,


January 2,2011


2010



2011


2010


2011


2010(In millions)Fair Value HedgesInterest Rate Exchange AgreementsFixed-rate debt


$
628


$
946



$
34


$
40


$



$
Fixed-rate receivables



451



419








3



(6
)


(3
)Net Investment HedgesForeign Currency Forward Exchange AgreementsForeign-dollar functional currency subsidiary equity



38



71
















(2
)Cash Flow HedgesCross-Currency Interest Rate Exchange AgreementsForeign-dollar denominated variable-rate debt/receivable



4



165








18



(2
)


(1
)$
1,121


$
1,601



$
34


$
61


$
(8
)

$
(6
)         Amount of Gain/(Loss)Gain/(Loss) Location



2010


2009(In millions)Fair Value HedgesInterest rate exchange agreements


Interest expense



$
25


$
(13
)Interest rate exchange agreements


Finance charges




(11
)


10    -39-




---



##### Table of Contents



NOTE 9Fair Value of Financial Instruments
    Assets
    Recorded at Fair Value on a Recurring Basis
  Derivative
    Financial Instruments
    Investment
    in Other Marketable Securities
    Changes
    in Fair Value for Unobservable Input
    2010


2009(In millions)Retained Interests in SecuritizationsBalance, beginning of period

$
3


$
12Transfers from nonrecurring classification






110Reclassification to Finance receivables held for investment


(3
)


(85
)Change in value recognized in Other comprehensive loss






11Impairments recognized in earnings






(8
)Collections, net






(37
)Balance, end of period

$



$
3  -40-




---



##### Table of Contents



Assets
    Recorded at Fair Value on a Nonrecurring Basis
   Balance at


Total LossJanuary 1,


January 2,2011


2010


2010


2009(In millions)Impaired finance receivables

$
504


$
694


$
(148
)

$
(165
)Finance receivables held for sale


413



819



(22
)


(14
)Repossessed assets and properties


117



85



(38
)


(30
)Other investments


32



30



(9
)


(20
)Operating assets received in satisfaction of troubled finance
    receivables






41







(11
)   Impaired
    Finance Receivables
    Finance
    Receivables Held for Sale
    and/or
 -41-




---



##### Table of Contents



Repossessed
    Assets and Properties / Operating Assets Received in
    Satisfaction of Troubled Finance Receivables
    Other
    Investments
   -42-




---



##### Table of Contents



Assets
    and Liabilities Not Recorded at Fair Value
    January 1, 2011


January 2, 2010Carrying


Estimated


Carrying


EstimatedValue


Fair Value


Value


Fair Value(In millions)Assets:Installment contracts

$
1,654


$
1,583


$
2,204


$
2,007Mortgage loans


781



686



1,008



924Revolving loans


395



359



1,058



902Distribution finance receivables


161



157



709



690Investment in other marketable securities










68



56Retained interests in securitizations, excluding interest-only
    securities










6



6$
2,991


$
2,785


$
5,053


$
4,585Liabilities:Bank line of credit

$
1,440


$
1,410


$
1,740


$
1,682Fixed-rate debt


894



885



1,534



1,490Securitized on-balance sheet debt


530



481



559



548Subordinated debt


300



252



300



207Variable-rate debt


271



272



1,355



1,333Amounts due to Textron Inc.


254



252



472



469$
3,689


$
3,552


$
5,960


$
5,729   Finance
    Receivables Held for Investment
  and/or
  Investments
    in Other Marketable Securities
   -43-




---



##### Table of Contents



Debt
    NOTE 10Investment in Parent Company Preferred Stock
    NOTE 11Comprehensive loss
    2010



2009


2008(In millions)Net loss


$
(230
)


$
(203
)

$
(461
)Foreign currency translation, net of income taxes of
    $48.6 million in 2010 and income tax benefits of
    $8.9 million in 2009 and $39.7 million in 2008



46




7



(79
)Net deferred gain (loss) on hedge contracts, net of income tax
    expense of $1.6 million in 2010 and income tax benefit of
    $0.8 million in 2008



3








(1
)Net deferred loss on retained interests, net of income tax
    benefits of $0.3 million in 2009 and $0.2 million in
    2008








(1
)


(1
)Comprehensive loss


$
(181
)


$
(197
)

$
(542
)     NOTE 12Income Taxes
    2010



2009


2008(In millions)United States


$
(354
)


$
(309
)

$
(478
)Foreign



13




4



(61
)Total


$
(341
)


$
(305
)

$
(539
)  -44-




---



##### Table of Contents



2010



2009


2008(In millions)Current:Federal


$
(29
)


$
108


$
19State



(2
)



12



(8
)Foreign



(2
)



(17
)


5Total current income tax (benefit) expense


$
(33
)


$
103


$
16Deferred:Federal


$
(70
)


$
(197
)

$
(89
)State



(8
)



(23
)


1Foreign








17



(6
)Total deferred income tax benefit



(78
)



(203
)


(94
)Total income tax benefit


$
(111
)


$
(100
)

$
(78
)       2010



2009


2008Federal statutory income tax rate



(35.0
)%



(35.0
)%


(35.0
)%Increase (decrease) in taxes resulting from:State income taxes



(3.5
)



(2.3
)


(0.8
)Non-U.S. tax
    rate differential



(1.6
)



0.6



3.7Change in state valuation allowance



1.6




1.0



(1.4
)Unrecognized tax benefits and interest



4.7




2.0



2.5Goodwill impairment












9.8Change in status of foreign subsidiaries



2.1




1.9



7.6Other, net



(0.9
)



(1.0
)


(0.8
)Effective income tax rate



(32.6
)%



(32.8
)%


(14.4
)%       non-U.S. tax
   -45-




---



##### Table of Contents



2010



2009(In millions)Balance  Beginning of year


$
9



$
6Additions for tax positions of the current year








2Additions for tax positions of prior years








3Reductions for tax positions of prior years



(2
)



Reductions for expiration of statute of limitation



(1
)



Reductions for settlements with tax authorities








(2
)Balance  End of year


$
6



$
9       non-U.S. income
    January 1, 2011



January 2, 2010(In millions)Deferred tax assets:Allowance for losses on finance receivables held for investment


$
128



$
132Valuation allowance on finance receivables held for sale



28




69Foreign currency translation








32Obligation for pension and postretirement benefits



34




32Nonaccrual finance receivables



31




19Net operating losses and credits



18




10Deferred origination fees



6




9Other



43




41Total deferred tax assets



288




344Valuation allowance for deferred tax assets



(22
)



(26
)Net deferred tax assets



266




318Deferred tax liabilities:Leveraged leases



219




238Finance leases



53




93Equipment on operating leases



54




69Other



50




55Total deferred tax liabilities



376




455Net deferred tax liabilities


$
110



$
137  -46-




---



##### Table of Contents



non-U.S. finance non-U.S. loan
  non-U.S. portion
    January 1, 2011


January 2, 2010(In millions)State net operating loss carryforwards expiring from 2011
    through 2030


$
12


$
8Non-U.S. net
    operating loss carryforwards expiring in 2030



4



State credit carryforwards beginning to expire in 2026



2



2   NOTE 13Commitments
        January 1, 2011(In millions)Committed revolving lines of credit

$
177Loans


15     NOTE 14Contingencies
   -47-




---



##### Table of Contents



NOTE 15Financial Information about Operating Segments
    2010



2009



2008(Dollars in millions)Revenues:Captive Finance


$
106




51
%


$
170




47
%


$
222




30
%Non-captive Finance



101




49
%



190




53
%



501




70
%Total revenues


$
207




100
%


$
360




100
%


$
723




100
%Loss before income taxes and noncontrolling
    interest:(1)(2)Captive Finance


$
(54
)







$
(95
)







$
28Non-captive Finance



(185
)








(197
)








(78
)Segment loss



(239
)








(292
)








(50
)Special charges



102









13









489Loss before income taxes and noncontrolling interest


$
(341
)







$
(305
)







$
(539
)Finance assets:(3)Captive Finance


$
2,224








$
3,016








$
3,668Non-captive Finance



2,588









4,404









5,631Total finance assets


$
4,812








$
7,420








$
9,299    (1)
    
    Interest expense is allocated to each segment in proportion to
    its net investment in finance assets. Net investment in finance
    assets includes finance assets less deferred income taxes,
    security deposits and other specifically identified liabilities.
    The interest allocation matches variable-rate finance assets in
    the Captive Finance segment with variable-rate debt of similar
    duration and fixed-rate finance assets in the Captive Finance
    segment with fixed-rate debt of similar duration to the extent
    possible. The remaining balance of interest expense incurred is
    included in the Non-captive Finance segments interest
    expense.(2)
    
    Direct operating expenses are included in each segments
    (loss)/income. Prior to 2009, indirect expenses were allocated
    to each segment based on the use of such resources and were
    based primarily upon the segments proportion of net
    investment in finance assets, headcount, number of transactions,
    information technology resources and senior management time. Due
    to the plan to exit all of our Non-captive Finance segment and
    the resulting variations in personnel levels and job
    responsibilities, indirect corporate oversight expenses,
    comprised primarily of executive salaries and benefits, are
    included in the segment loss of the Non-captive Finance segment,
    although a portion of these expenses relate to oversight of the
    Captive Finance segment.(3)
    
    Finance assets include: finance receivables; equipment on
    operating leases, net of accumulated depreciation; repossessed
    assets and properties; operating assets received in satisfaction
    of troubled finance receivables; retained interests in
    securitizations; investments in other marketable securities and
    other short- and long-term investments (some of which are
    classified in Other assets on Textron Financials
    Consolidated Balance Sheets). -48-




---



##### Table of Contents



NOTE 16Quarterly Financial Data (Unaudited)
  First Quarter



Second Quarter



Third Quarter



Fourth Quarter2010



2009



2010



2009



2010



2009



2010


2009(In millions)Revenues


$
73



$
122



$
55



$
86



$
55



$
71



$
24


$
81Net interest margin


$
37



$
63



$
17



$
41



$
20



$
33



$
(2
)

$
46Operating and administrative expenses



41




53




44




53




45




54




39



50Provision for losses



55




76




44




87




28




43




15



59Segment loss



(59
)



(66
)



(71
)



(99
)



(53
)



(64
)



(56
)


(63
)Special charges



3




3




3




5




94




1




2



4Loss before income taxes and noncontrolling interest



(62
)



(69
)



(74
)



(104
)



(147
)



(65
)



(58
)


(67
)Income tax benefit



(21
)



(16
)



(36
)



(39
)



(35
)



(21
)



(19
)


(24
)Net loss before noncontrolling interest



(41
)



(53
)



(38
)



(65
)



(112
)



(44
)



(39
)


(43
)Noncontrolling interest, net of income taxes


















1









(3
)







Net loss


$
(41
)


$
(53
)


$
(38
)


$
(66
)


$
(112
)


$
(41
)


$
(39
)

$
(43
)  -49-




---



##### Table of Contents



Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure    Item 9A.
    Controls
    and Procedures  Rule 13a-15(e) 15d-15(e))
  Form 10-K.
  10-K.
  c)
    Changes in Internal Controls  There has been no
    change in our internal control over financial reporting during
    the fourth fiscal quarter of the fiscal year covered by this
    report that has materially affected, or is reasonably likely to
    materially affect, our internal control over financial reporting.  Item 9B.
    Other
    Information      PART III.
  Item 10.
    Directors
    and Executive Officers of the Registrant  Form 10-K.
  Item 11.
    Executive
    Compensation  Form 10-K.
  Item 12.
    Security
    Ownership of Certain Beneficial Owners and
    Management  Form 10-K.
  Item 13.
    Certain
    Relationships and Related Transactions  Form 10-K.
 -50-




---



##### Table of Contents



Item 14.
    Principal
    Accounting Fees and Services    Audit Fees  Forms 10-Q,
  Audit Related Fees
  Tax Fees
  All Other Fees
 PART IV.  Item 15.
    Exhibits,
    Financial Statement Schedules  (1)
    List of
    Financial Statements and Financial Statement Schedules    1.
    Consolidated Statements of Operations for each of the years in
    the three-year period ended January 1, 2011.2.
    Consolidated Balance Sheets at January 1, 2011 and
    January 2, 2010.3.
    Consolidated Statements of Cash Flows for each of the years in
    the three-year period ended January 1, 2011.4.
    Consolidated Statements of Changes in Equity for each of the
    years in the three-year period ended January 1, 2011.5.
    Notes to the Consolidated Financial Statements.    (2)
    Exhibits  Regulation S-K
  Exhibit No.3.1

Restated Certificate of Incorporation of Textron Financial,
    dated July 19, 1993. Incorporated by reference to
    Exhibit 3.1 to Textron Financial Corporations
    Registration Statement on Form 10 (File
    No. 0-27559).3.2

By-Laws of Textron Financial Corporation as of May 2, 2000.
    Incorporated by reference to Exhibit 3.1 to Textron
    Financial Corporations Quarterly Report on
    Form 10-Q
    filed August 11, 2000.4.1A

Indenture dated as of December 9, 1999, between Textron
    Financial Corporation and SunTrust Bank (formerly known as Sun
    Trust Bank, Atlanta) (including form of debt securities).
    Incorporated by reference to Exhibit 4.1 to Amendment
    No. 2 to Textron Financial Corporations Registration
    Statement on
    Form S-3
    (No. 333-88509). -51-




---



##### Table of Contents



Exhibit No.4.1B

First Supplemental Indenture dated November 16, 2006
    between Textron Financial Corporation and U.S. Bank National
    Association (successor to SunTrust Bank) to Indenture dated as
    of December 9, 1999. Incorporated by reference to
    Exhibit 4.3 to Textron Financial Corporations
    Registration Statement on
    Form S-3
    (File
    No. 333-138755).4.1C

Form of Medium-Term Note of Textron Financial Corporation.
    Incorporated by reference to Exhibit 4.3 to Textron
    Financial Corporations Current Report on
    Form 8-K
    filed November 17, 2006.4.3A

Indenture, dated as of February 8, 2007, between Textron
    Financial Corporation and Deutsche Bank Trust Company
    Americas, as trustee, incorporated herein by reference to
    Exhibit 99.1 of Textron Financial Corporations
    Current Report on
    Form 8-K
    filed February 13, 2007.4.3B

Contribution Agreement, dated February 8, 2007, between
    Textron Financial Corporation and Textron Inc, incorporated
    herein by reference to Exhibit 99.2 of Textron Financial
    Corporations Current Report on
    Form 8-K
    filed February 13, 2007.4.3C

Replacement Capital Covenant, dated February 8, 2007,
    incorporated herein by reference to Exhibit 99.3 of Textron
    Financial Corporations Current Report on
    Form 8-K
    filed February 13, 2007.4.4A

Credit Agreement dated as of July 14, 2009 among Cessna
    Finance Export Corporation, as borrower, Textron Finance Holding
    Company, as borrower parent, Textron Financial Corporation, as
    guarantor, Wells Fargo Bank Northwest, National Association, as
    Security Trustee and Export-Import Bank of the United States.
    Incorporated by reference to Exhibit 99.1 to Textron
    Financial Corporations Current Report on
    Form 8-K
    filed July 16, 2009.4.4B

Servicing Agreement dated as of July 14, 2009 between
    Textron Financial Corporation, as servicer, and Cessna Finance
    Export Corporation. Incorporated by reference to
    Exhibit 99.2 to Textron Financial Corporations
    Current Report on
    Form 8-K
    filed July 16, 2009.4.4C

TFC Guarantee dated as of July 14, 2009 by Textron
    Financial Corporation in favor of Wells Fargo Bank Northwest,
    National Association, as Security Trustee, and Export-Import
    Bank of the United States. Incorporated by reference to
    Exhibit 99.3 to Textron Financial Corporations
    Current Report on
    Form 8-K
    filed July 16, 2009.10.1

Support Agreement dated as of May 25, 1994, between Textron
    Financial Corporation and Textron Inc. Incorporated by reference
    to Exhibit 10.1 to Textron Financial Corporations
    Registration on Form 10 (File
    No. 0-27559).10.2

Receivables Purchase Agreement between Textron Financial and
    Textron dated as of January 1, 1986. Incorporated by
    reference to Exhibit 10.2 to Textron Financial
    Corporations Registration on Form 10 (File
    No. 0-27559).10.3

Tax Sharing Agreement between Textron Financial and Textron
    dated as of December 29, 1990. Incorporated by reference to
    Exhibit 10.3 to Textron Financial Corporations
    Registration on Form 10 (File
    No. 0-27559).10.4A

5-Year
    Credit Agreement, dated as of March 28, 2005, among
    Textron, the Banks listed therein, JPMorgan Chase Bank, N.A., as
    Administrative Agent, and Citibank, N.A., as Syndication Agent.
    Incorporated by reference to Exhibit 10.1 to Textrons
    Current Report on
    Form 8-K
    filed March 31, 2005.10.4B

Amendment No. 1, dated as of April 21, 2006, to the
    5-Year
    Credit Agreement, dated as of March 28, 2005, among
    Textron, the Banks listed therein, JPMorgan Chase Bank, N.A., as
    Administrative Agent, and Citibank, N.A., as Syndication Agent.
    Incorporated by reference to Exhibit 10.1 to Textrons
    Current Report on
    Form 8-K
    filed April 25, 2006.10.4C

Amendment No. 2, dated as of April 20, 2007, to the
    5-Year
    Credit Agreement, dated as of March 28, 2005, as amended on
    April 21, 2006, among Textron the Banks listed therein,
    JPMorgan Chase Bank, N.A., as Administrative Agent, and
    Citibank, N.A., as Syndication Agent, incorporated herein by
    reference to Exhibit 10.1 of Textron Inc.s Current
    Report on
    Form 8-K
    filed April 25, 2007.10.5A

Five-Year Credit Agreement dated July 28, 2003 among
    Textron Financial Corporation, the Banks listed therein, and
    JPMorgan Chase Bank, as Administrative Agent. Incorporated by
    reference to Exhibit 10.2 to Textron Financial
    Corporations Current Report on
    Form 8-K
    filed August 26, 2003. -52-




---



##### Table of Contents



Exhibit No.10.5B

Amendment No. 1, dated as of July 25, 2005, to the
    Five-Year Credit Agreement dated as of July 28, 2003 among
    Textron Financial, the Banks listed therein, and JPMorgan Chase
    Bank N.A., as Administrative Agent. Incorporated by reference to
    Exhibit 10.1 to Textron Financial Corporations
    Current Report on
    Form 8-K
    filed July 27, 2005.10.5C

Amendment No. 2, dated as of April 28, 2006, to the
    Five-Year Credit Agreement, dated as of July 28, 2003,
    among Textron Financial Corporation, the Banks listed therein
    and JPMorgan Chase Bank N.A., as Administrative Agent.
    Incorporated by reference to Exhibit 10.1 to Textron
    Financial Corporations Current Report on
    Form 8-K
    filed May 1, 2006.10.5D

Amendment No. 3, dated as of April 27, 2007, to the
    Five-Year Credit Agreement, dated as of July 28, 2003, as
    amended on March 28, 2005 and April 28, 2006, among
    Textron Financial Corporation, the Banks listed therein and
    JPMorgan Chase Bank N.A., as Administrative Agent. Incorporated
    by reference to Exhibit 10.1 to Textron Financial
    Corporations Current Report on
    Form 8-K
    filed April 27, 2007.12

Computation of Ratio of Earnings to Fixed Charges.23

Consent of Independent Registered Public Accounting Firm.24

Power of Attorney dated as of March 1, 2011.31.1

Certification of Chief Executive Officer Pursuant to
    Rule 13a-14(a).31.2

Certification of Chief Financial Officer Pursuant to
    Rule 13a-14(a).32.1

Certification of Chief Executive Officer Pursuant to
    18 U.S.C. Section 1350.32.2

Certification of Chief Financial Officer Pursuant to
    18 U.S.C. Section 1350.     Note:
    Instruments defining the rights of holders of certain issues of
    long-term debt of Textron Financial have not been filed as
    exhibits to this Report because the authorized principal amount
    of any one of such issues does not exceed 10% of the total
    assets of Textron Financial and its subsidiaries on a
    consolidated basis. Textron Financial agrees to furnish a copy
    of each such instrument to the Commission upon request. -53-




---



##### Table of Contents



SIGNATURES
  Form 10-K st
  
  By:
    *  Warren R. Lyons   st
  By:
    *  Warren R. Lyons    By:
    *  Mary F. Lovejoy   By:
    *  Eric Salander   By:
    /s/  Thomas
    J. Cullen  Thomas J. Cullen    By:
    /s/  Thomas
    N. Nichipor  Thomas N. Nichipor    *By:
    /s/  Elizabeth
    C. Perkins  Elizabeth C. Perkins  -54-