Exhibit 10.16


 


DIRECTOR REMUNERATION PACKAGE


COMPENSATION AND BENEFITS
SUMMARY


FOR NON-EMPLOYEE DIRECTORS


 


COMPENSATION


 


Retainer                                An
annual retainer of $110,000 is paid in quarterly installments at the end of
each full quarter.  Payments are prorated
for partial calendar quarters served.  At
least $65,000 of the annual Board retainer must be deferred into the Directors’
Deferred Income Plan stock unit account. 
Committee chairpersons are paid an additional $5,000 annual retainer,
except in the case of the Audit Committee chair who is paid an additional
$15,000 annual retainer.  The additional
retainer is paid in quarterly installments at the end of each full quarter, and
payments are prorated for partial quarters served.


 


Meeting
Fees                                                                                   $1,500
is paid for each Board and committee meeting attended, except in the case of
the Audit Committee for which $2,500 is paid for each meeting attended


 


Annual
Stock Grant                                        Once
a year, on April 30th, deferred stock units will be granted equal to 20% of the
then current annual retainer.  To be
eligible for this credit, the Director must be a Director on the date of the
Annual Shareholders’ Meeting and must have been a Director for more than three
months.


 


Restricted
Stock                                                                A
grant of 1,000 shares of restricted stock is made to non-employee Directors
upon joining the Board.


 


DEFERRED
INCOME PLAN


 


                                                                                                                                                            In addition to the required deferral to
the stock unit account of $65,000 of the retainer, any percentage of the remainder
of the retainer and meeting fees may be deferred into either the stock unit
account or an interest bearing account. 
Textron will contribute a 10% premium for all amounts deferred into the
stock unit account in excess of the minimum deferral amount.  This premium will also be deferred in full to
the stock unit account.  The annual stock
grant will be credited (without premium) to the stock unit account.


 


OTHER


 


Expenses                                                                                                          Reasonable
travel, lodging and incidental expenses in connection with meetings are
reimbursed.


 


Matching


Gift Programs                     The
Textron Charitable Trust will match Director contributions from a minimum gift
of $25 to an aggregate maximum of $7,500 annually to any mix of cultural,
educational, environmental or hospital institutions on a $1 for $1 basis.


 


Director’s Charitable


Award Program                  Textron
sponsors a program under which it contributes up to $1,000,000 to the Textron
Charitable Trust on behalf of each director upon his or her death, and the
trust donates 50% of that amount in accordance with the director’s
recommendation among up to five charitable organizations.  Payment of the contributions ultimately are
recovered from life insurance policies that Textron maintains on the lives of
directors for this purpose.  The
directors do not receive any direct financial benefit from this program since
the insurance proceeds and charitable deductions accrue solely to Textron.  The program was closed to new participants in
2004.


 


CitationShares Directors


Evaluation
Program                                      
The CitationShares Director’s Evaluation Program was
established to evaluate the performance of the CitationShares fractional
ownership program, a joint venture between Cessna Aircraft Company and TAG
Aviation USA.  Under the program, Textron
makes ten hours per year of free flight time available for personal use to
non-employee Directors on Cessna Citation aircraft purchased by Textron from
CitationShares under the fractional ownership program.  Usage by participating Directors exceeding
ten hours per year is billed to Directors at Textron’s cost.  Following each flight, a participating
Director is expected to complete an evaluation of his or her travel experience.