Document:

exv10w1h

Exhibit 10.1 H

Notice of Grant of Performance Share Units 

and Performance Share Unit Agreement

 

	 	 	 
	«First» «Last»

	 	PSU No.: «PSU_Grant_»
	«Addr1»

	 	Plan: 2007
	«Addr2»

	 	ID: «EMPID»
	«City», «State» «ZIP» «Country»

	 	Location: Corporate

 

Effective «Grant_Date», pursuant to the 2007 Long-Term Incentive Plan (the “Plan”), you have been
granted «PSU» Performance Share Units, which constitute the right to receive, if earned pursuant to
their terms, the cash equivalent of a number of shares of Common Stock of Textron Inc. determined
by a formula and valued as provided in the Performance Share Unit Terms and Conditions (2/2009).

This grant is governed by the Performance Share Unit Terms and Conditions (2/2009) and the Plan
(both of which are available on the Textron Enterprise Intranet) and is subject to the Performance
Share Unit Non-Competition Agreement (2/2009 version) attached hereto.

The Performance Period is the period beginning with Fiscal Year 2009 and ending with Fiscal Year
2011. Separate performance measures will be established for each fiscal year within the
Performance Period, and the performance measures for each fiscal year will apply to one third of
the Performance Share Units granted for the Performance Period. The Committee has discretion to
reduce the number of units earned for annual performance in each fiscal year. In determining
whether to reduce the number of units earned for annual performance in each fiscal year, the
Committee expects to apply guidelines based on cumulative performance for all three fiscal years in
the Performance Period; but the Committee has discretion to make a downward adjustment that is
larger or smaller than the reduction indicated in the guidelines.

The attached document «PSU_Grant_» shows the performance measures and units you can earn based on
annual performance for Fiscal Year 2009, which apply to one third of the Performance Share Units
granted to you in this award. Performance measures and units you can earn for Fiscal Year 2010 and
Fiscal Year 2011 will be established and communicated to you during the first 90 days of each
fiscal year.

The attached document also shows the guidelines that the Committee expects to follow in determining
whether to reduce the number of units earned each year based on performance for all three fiscal
years in the Performance Period. If the Committee elects to make a reduction, the reduction would
apply at the end of the Performance Period to all of the units you have earned in each fiscal year
during the Performance Period. As a result, any payout you receive at the end of the Performance
Period would be based in part on annual performance and in part on performance for the entire
Performance Period. The Committee has discretion to make a downward adjustment larger or smaller
than the reduction indicated in the attached guidelines.

 

 

The cash value of all PSUs will be paid (to the extent earned) following the end of the Performance
Period, before March 15. Accordingly, PSUs earned based on annual performance in the first or
second year of the Performance Period will be reduced, at the Committee’s discretion, at the end of
the third year of the Performance Period, and will not be paid until the 21/2 month period following
the third year of the Performance Period. All PSUs, including PSUs earned based on annual
performance in the first or second year of the Performance Period, remain subject to forfeiture
until the end of the Performance Period as provided in the Performance Share Unit Terms and
Conditions (2/2009).

By your signature and the Company’s signature below, you and the Company agree that this grant is
governed by the attached Performance Share Unit Terms and Conditions (2/2009) and the Plan, both of
which are available on the Textron Enterprise Intranet. In addition, you agree that this grant is
subject to the Performance Share Unit Non-Competition Agreement (2/2009 version) attached hereto,
the terms of which are fully incorporated herein.

TEXTRON INC.

 

	 	 	 	 	 
	By:
	 	 	 	 
	 
	 	 	 	 
	 

	 	 
	 	Date
	 
	 	 	 	 
	Agreed by:
	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	Date

Please retain a copy of this signed agreement and return the original to

your Human Resources Department within 30 days of receipt of this document.

 

 

Performance Share Units

2009 — 2011 Award Period

«PSU_Grant_»

Annual Performance Measures for Fiscal Year 20[ ]: 

Applicable to One Third of Performance Share Units

Detail of Fiscal Year 20[ ] Performance Measures for each Component

	 	 	 	 	 	 	 	 	 
	 	 	 	 	Performance	 	% of Units	 	Units for
	Measure	 	Weighting	 	vs. Target	 	Earned	 	Component
	 

	 	 
	 	 
	 	 	 	 

	•	 	Intermediate performance between the minimum and maximum levels specified earns a
corresponding percentage of Performance Share Units (PSUs) for each component.
	 
	•	 	PSUs earned for the fiscal year equal one third of the units granted times the percentage
earned based on performance and targets identified above.
	 
	•	 	PSUs earned for the fiscal year are subject to reduction, at the Committee’s discretion,
based on performance for all three fiscal years in the Performance Period.
	 
	•	 	All PSUs are paid in cash, to the extent earned, following the end of the Performance
Period, before March 15. Accordingly, PSUs earned (subject to reduction) in the first or
second year of the Performance Period will not be paid until the 21/2 month period following the
third year of the Performance Period.
	 
	•	 	All PSUs, including PSUs earned (subject to reduction) in the first or second year of the
Performance Period, remain subject to forfeiture until the end of the Performance Period as
provided in the Performance Share Unit Terms and Conditions (2/2009).
	 
	•	 	The cash-out value of each PSU earned is equal to the average closing share price of
Textron common stock during the first 10 trading days of the fiscal year immediately following
the end of the Performance Period. Thus, PSU payouts are correlated to both financial and
share price performance over the measurement period.

 

 

Performance Share Units

2009 — 2011 Award Period

«PSU_Grant_»

Guidelines for Discretionary Performance Reduction

for 2009 — 2011 Award Period: 

Applicable to All Performance Share Units

PSU Reduction Factor Based on Performance for 2009 — 2011

	 	 	 	 
	Performance for 2009 - 2011:	 	 	 
	3-Year Performance Measure[s]	 	 	Award Adjustment
	 
	 	 	 

	•	 	Intermediate performance between the minimum and maximum levels specified might earn a
corresponding reduction.
	 
	•	 	The Committee may make a discretionary reduction in the Performance Share Units (PSUs)
earned based on annual performance for each fiscal year in the Performance Period. The
Committee expects to reduce the PSUs using the guidelines shown above; but the Committee has
discretion to make a larger or smaller downward adjustment.
	 
	•	 	All PSUs are paid in cash, to the extent earned, following the end of the Performance
Period, before March 15. Accordingly, PSUs earned (subject to reduction) in the first or
second year of the Performance Period will not be paid until the 21/2 month period following the
third year of the Performance Period.
	 
	•	 	All PSUs, including PSUs earned (subject to reduction) in the first or second year of the
Performance Period, remain subject to forfeiture until the end of the Performance Period as
provided in the Performance Share Unit Terms and Conditions (2/2009).
	 
	•	 	The cash-out value of each PSU earned is equal to the average closing share price of
Textron common stock during the first 10 trading days of the fiscal year immediately following
the end of the Performance Period. Thus, PSU payouts are correlated to both financial and
share price performance over the measurement period.

 

 

TEXTRON INC.

TEXTRON 2007 LONG-TERM INCENTIVE PLAN

PERFORMANCE SHARE UNIT TERMS AND CONDITIONS

(2/2009)

____________________

	•	 	Pursuant to the 2007 Long-Term Incentive Plan (the “Plan”), Textron has awarded to
executive the number of Performance Share Units set forth on the applicable Notice of Grant
signed by Textron and Grantee on the terms and conditions herein set forth. Each Performance
Share Unit constitutes the right to receive cash equal to the fair market value of one share
of Common Stock of Textron Inc. for each Performance Share Unit earned by the executive, as
determined in accordance with the Plan, the Notice of Grant, the Performance Share Unit
Non-Competition Agreement (2/2009), and these Performance Share Unit Terms and Conditions
(2/2009). Performance Share Units earned for the Performance Period are based on annual
performance for each fiscal year in the Performance Period and may be reduced based on
performance for the entire Performance Period. The earned Performance Share Units payable to
the executive in accordance with the provisions of this agreement shall be paid solely in cash
based on the fair market value of the Common Stock (determined based on the average of the
closing prices of Textron’s common stock, as reported on the New York Stock Exchange, for the
first ten trading days immediately following the end of the Performance Period).
	 
	•	 	When the applicable Performance Period ends, Textron will issue to the executive cash equal
to the aggregate value of the Performance Share Units earned by the executive, reduced by the
amount needed to satisfy required statutory minimum withholding taxes. The cash payment shall
be made following the end of the Performance Period, before March 15.
	 
	•	 	If the executive’s employment with Textron shall terminate for “Cause,” all Performance
Share Units awarded to the executive for which the applicable Performance Period has not ended
shall be forfeited (including, but not limited to, Performance Share Units that have already
been earned based on annual performance during a fiscal year in the Performance Period).
	 
	•	 	Except as otherwise provided herein, the executive shall forfeit outstanding Performance
Share Units (including, but not limited to, Performance Share Units that have already been
earned based on annual performance during a fiscal year in the Performance Period) if the
executive’s employment with Textron ends for any reason prior to the end of the Performance
Period applicable to such Performance Share Units, provided that if the executive’s employment
ends (other than for Cause) prior to such date because of “Disability,” death or after the
executive has become eligible for “Early or Normal Retirement,” and if the executive has been
employed by Textron for at least one year after the beginning of the Performance Period, the
executive or the executive’s estate will receive a cash payment (subject to tax withholding)
at the end of the Performance Period for (1) the Performance Share Units actually earned for
any fiscal year that is completed before the executive’s employment ends, and (2) a “Pro-Rata
Portion” of the Performance Share Units for the fiscal year in which the executive’s
employment ends (to the extent that the financial performance goals applicable to the
Performance Share Units have been

 

 

	 	 	achieved upon the completion of such fiscal year), subject to a discretionary reduction, in
each case, based on performance for all three fiscal years in the Performance Period.
	•	 	Notwithstanding the above, the applicable Performance Period for the Performance Share
Units which may be paid pursuant to this Award shall end immediately upon a “Change in
Control” of Textron, as defined in the Plan. In such instance, Textron shall pay to the
executive (or to the executive’s estate in the event of the executive’s death prior to
payment), subject to tax withholding, (1) the value of any Performance Share Units actually
earned for any fiscal year that has already ended, and (2) the full value (assuming annual
performance at target levels) of the unearned Performance Share Units outstanding for any
fiscal year that has not yet ended, without discretionary reduction in either case for
performance in all three fiscal years in the Performance Period. The payment shall be made
within 30 days after the Change in Control, provided that the accelerated payment does not
violate Section 409A of the Internal Revenue Code. If the accelerated payment of the Award
would violate Section 409A of the Internal Revenue Code, the payment shall be made on the date
when the Performance Share Unit would have been paid if no Change in Control had occurred.
Note: Sale of a business unit usually does not constitute a Change in Control as defined in
the Plan.
	 
	•	 	The number of Performance Share Units awarded to the executive hereunder shall be equitably
adjusted in the event of a stock split, stock dividend, recapitalization, reorganization,
merger, consolidation, split-up, spin-off, or any other corporate event affecting the Common
Stock, as provided in the Plan, in order to preserve the benefits or potential benefits
intended to be made available to the Grantee.
	 
	•	 	Nothing in this document shall confer upon the executive the right to continue in the
employment of Textron or affect any right that Textron may have to terminate the employment of
the executive.
	 
	•	 	The Performance Share Units shall not be assignable or transferable by the executive.
	 
	•	 	The executive shall not have voting rights nor will the executive qualify for dividends
with respect to the Performance Share Units during the Performance Period.
	 
	•	 	The Performance Share Units shall be subject to the terms and conditions of the Plan in all
respects.

DEFINITIONS

“Cause” 

“Cause” shall mean: (i) an act or acts of willful misrepresentation, fraud or willful dishonesty
(other than good faith expense account disputes) by the executive which in any case is intended to
result in his or another person or entity’s substantial personal enrichment at the expense of
Textron; (ii) any willful misconduct by the executive with regard to Textron, its business, assets
or employees that has, or was intended to have, a material adverse impact (economic or otherwise)
on Textron; (iii) any material, willful and knowing violation by the executive of (x) Textron’s
Business Conduct Guidelines, or (y) any of his or her fiduciary duties to Textron which in either
case has, or was intended to

 

 

have, a material adverse impact (economic or otherwise) on Textron; (iv) the willful or reckless
behavior of the executive with regard to a matter of a material nature which has a material adverse
impact (economic or otherwise) on Textron; (v) the executive’s willful failure to attempt to
perform his or her duties or his or her willful failure to attempt to follow the legal written
direction of the Board, which in either case is not remedied within ten (10) days after receipt by
the executive of a written notice from Textron specifying the details thereof; or (vi) the
executive’s conviction of, or pleading nolo contendere or guilty to, a felony (other than (x) a
traffic infraction or (y) vicarious liability solely as a result of his position provided the
executive did not have actual knowledge of the actions or in actions creating the violation of the
law or the executive relied in good faith on the advice of counsel with regard to the legality of
such action or inaction (or the advice of other specifically qualified professionals as to the
appropriate or proper action or inaction to take with regard to matters which are not matters of
legal interpretation); No action or inaction should be deemed willful if not demonstrably willful
and if taken or not taken by the executive in good faith as not being adverse to the best interests
of Textron. Reference in this paragraph to Textron shall also include direct and indirect
subsidiaries of Textron, and materiality and material adverse impact shall be measured based on the
action or inaction and the impact upon, and not the size of, Textron taken as a whole, provided
that after a Change in Control, the size of Textron, taken as a whole, shall be a relevant factor
in determining materiality and material adverse impact.

“Performance Period” 

For the purposes of this grant, the Performance Period means the period of three fiscal years
identified in the Notice of Grant.

“Early or Normal Retirement” 

“Early retirement” with Textron is defined as attainment of age 60 or the completion of 20 years of
vesting service or the attainment of age 55 with the completion of 10 years of vesting service.
“Normal retirement” with Textron is age 65.

“Disability” 

“Disability” shall mean, for purposes of this Award, the inability of the executive to engage in
any substantial gainful activity due to injury, illness, disease, bodily or mental infirmity which
can be expected to result in death or is expected to be permanent. An individual shall not be
considered disabled unless executive furnishes proof of the existence thereof. Textron may require
the existence or non-existence of a disability to be determined by a physician whose selection is
mutually agreed upon by the executive (or his or her representatives) and Textron.

“Pro-Rata Portion” 

“Pro-Rata Portion” shall mean the number of complete or partial months of the executive’s active
service to Textron during the fiscal year divided by 12. An executive must be employed by Textron
for a minimum of one year after the beginning of the Performance Period before pro-rata Performance
Share Units may be paid. The Pro-Rata Portion shall apply to one third of the Performance Share
Units granted to the executive, shall be payable to an executive only to the extent that the
financial performance goals for

 

 

the fiscal year are satisfied, and shall be subject to a discretionary reduction at the end of the
Performance Period based on performance for all three fiscal years in the Performance Period.

Example: On March 1, 2009, an executive was granted 6,000 Performance Share Units constituting the
right to receive the cash equivalent value of 6,000 shares to be paid (to the extent earned)
following completion of the 2009-2011 Performance Period. The annual performance goals for each
fiscal year during the Performance Period are applicable to 2,000 of the executive’s Performance
Share Units.

The performance during 2009 was sufficient to earn 100% of the applicable Performance Share Units
for that fiscal year. The executive terminates employment with Textron on August 16, 2010, after
having attained age 55 with the completion of 10 years of vesting service.

Because the executive’s age and years of service qualify as ‘early retirement’ and the executive
was employed by Textron for one year after the beginning of the performance period, the executive
is eligible to receive the cash equivalent of the 2,000 Performance Share Units actually earned in
2009, plus a pro-rata portion of the 2,000 Performance Share Units available for 2010 (provided
that the Performance Share Units for 2010 are earned pursuant to their terms), subject to a
discretionary reduction based on performance for the entire Performance Period. Assuming that the
financial performance goals for 2010 are also satisfied at the 100% level, the number of
Performance Share Units earned for 2010 would be calculated as follows:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Number of Complete	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	or Partial Months	 	 	 	 	 	 	 	 
	Fiscal Year	 	PSUs Available for	 	 	 	Employed by Textron	 	 	 	 	 	 	 	 
	of	 	2010 (one third of	 	 	 	During the 2010	 	 	 	Number of Months in	 	 	 	 
	Termination	 	total grant)	 	 	 	Fiscal Year	 	 	 	the Fiscal Year	 	 	 	Pro-Rata Portion
	2010

	 	 	2,000	 	 	x
	 	 	8	 	 	÷
	 	 	12	 	 	=
	 	1,333 units
(subject to
adjustment — paid,
to the extent
earned, in early
2012)

At the end of 2011, the cumulative performance for the entire 2009-2011 Performance Period
indicates a 17% reduction in the executive’s performance units under the discretionary reduction
guidelines. In these circumstances, the Committee expects to reduce the executive’s 3,333 PSUs by
17%, although the Committee has discretion to make a larger or smaller downward adjustment. If the
Committee elects to make a 17% reduction in the executive’s PSUs, the executive will be entitled to
receive a cash payment (during the first 21/2 months of 2012) equal to the value of 2,766 shares of
Textron common stock.

 

 

TEXTRON INC.

PERFORMANCE SHARE UNIT NON-COMPETITION AGREEMENT

(2/2009)

You have been granted Performance Share Units (“PSUs”) pursuant to the Textron 2007 Long-Term
Incentive Plan (the “Plan”). Textron grants Performance Share Units to attract, retain and reward
employees, to increase identification with Textron’s interests and the interests of Textron’s
shareholders, and to provide incentive for remaining with and enhancing the value of Textron over
the long-term. In consideration for granting Performance Share Units to you, please acknowledge
that you have read and agree to this Performance Share Unit Non-Competition Agreement by signing
the attached Notice of Grant of Performance Share Unit and Performance Share Unit Agreement.

Agreement regarding Your Performance Share Units

	1.	 	Forfeiture of PSUs and required repayment if you engage in certain competitive
activities
	 
	 	 	If at any time during the Performance Period (as defined in the Notice of Grant of Performance
Share Unit and Performance Share Unit Agreement) while you are a Company employee, or within
two years after the termination of your employment, you do any of the following activities:

	 	(a)	 	engage in any business which competes with the Company’s business (as defined in
Paragraph 2) within the Restricted Territory (as defined in Paragraph 3); or
	 
	 	(b)	 	solicit customers, business or orders or sell any products and services (i) in
competition with the Company’s business within the Restricted Territory or (ii) for any
business, wherever located, that competes with the Company’s business within the
Restricted Territory; or
	 
	 	(c)	 	divert, entice or otherwise take away customers, business or orders of the
Company within the Restricted Territory, or attempt to do so; or
	 
	 	(d)	 	promote or assist, financially or otherwise, any firm, corporation or other
entity engaged in any business which competes with the Company’s business within the
Restricted Territory;

	 	 	then your right to receive all Performance Share Units shall be forfeited effective the date
you enter into such activity, and you will be required to repay Textron an amount equal to the
value of any PSU earned and paid to you from and after the date beginning 180 days prior to the
earlier of (a) your termination of employment or (b) the date you engage in such activity, or
at any time after such date. You will be in violation of Paragraph 1 if you engage in any or
all of the activities discussed in this Paragraph directly as an individual or indirectly as an
employee, representative, consultant or in any other capacity on behalf of any firm,
corporation or other entity.
	 
	2.	 	Company’s business — Defined for the purpose of this Agreement:

	 	(a)	 	the Company shall include Textron and all subsidiary, affiliated or related
companies or operations of Textron, and

 

 

	 	(b)	 	the Company’s business shall include the products manufactured, marketed and sold
and/or the services provided by any operation of the Company for which you have worked
or to which you were assigned or had responsibility (either direct or supervisory), at
the time of the termination of your employment and any time during the two-year period
prior to such termination.

	3.	 	Restricted Territory — Defined for the purpose of Paragraph 1, the Restricted
Territory shall be defined as and limited to:

	 	(a)	 	the geographic area(s) within a one hundred (100) mile radius of any and all
Company location(s) in or for which you have worked or to which you were assigned or had
responsibility (either direct or supervisory), at the time of the termination of your
employment and at any time during the two-year period prior to such termination; and
	 
	 	(b)	 	all of the specific customer accounts, whether within or outside of the
geographic area described in (a) above, with which you have had any contact or for which
you have had any responsibility (either direct or supervisory), at the time of
termination of your employment and at any time during the two-year period prior to such
termination.

	4.	 	Forfeiture of PSUs and required repayment if you engage in certain solicitation
activities
	 
	 	 	If you directly or indirectly solicit or induce or attempt to solicit or induce any
employee(s), sales representative(s), agent(s) or consultant(s) of the Company to terminate
their employment, representation or other association with the Company, then your right to
receive all PSUs shall be forfeited effective the date you enter into such activity and you
will be required to repay Textron an amount equal to the value of any PSU earned and paid to
you from and after the date beginning 180 days prior to the earlier of (a) your termination of
employment or (b) the date you engage in such activity, or at any time after such date.
	 
	5.	 	Forfeiture of PSUs and required repayment if you disclose confidential information
	 
	 	 	You specifically acknowledge that any trade secrets or confidential business and technical
information of the Company or its suppliers or customers, whether reduced to writing,
maintained on any form of electronic media, or maintained in your mind or memory and whether
compiled by you or the Company, derives independent economic value from not being readily known
to or ascertainable by proper means by others who can obtain economic value from its disclosure
or use; that reasonable efforts have been made by the Company to maintain the secrecy of such
information; that such information is the sole property of the Company or its suppliers or
customers and that any retention, use or disclosure of such information by you during your
employment (except in the course of performing your duties and obligations of employment with
the Company) or after termination thereof, shall constitute a misappropriation of the trade
secrets of the Company or its suppliers or customers. If you directly or indirectly
misappropriate any such trade secrets, then your right to receive all PSUs shall be forfeited
effective the date you enter into such activity and you will be required to repay Textron an
amount equal to the value of any PSU earned and paid to you from and after the date beginning
180 days prior to the earlier of (a) your termination of employment or (b) the date you engage
in such activity, or at any time after such date.

 

 

	6.	 	Organization and Compensation Committee Discretion
	 
	 	 	You may be released from your obligations under Paragraph 1, 4 and 5 above only if the
Organization and Compensation Committee of the Board of Directors (or its duly appointed agent)
determines in its sole discretion that such action is in the best interests of Textron.
	 
	7.	 	Severability
	 
	 	 	The parties agree that each provision contained in this Agreement shall be treated as a
separate and independent clause, and the unenforceability of any one clause shall in no way
impair the enforceability of any of the other clauses herein. Moreover, if one or more of the
provisions contained in this Agreement shall for any reason be held to be excessively broad as
to scope, activity or subject, then such provisions shall be construed by the appropriate
judicial body by limiting and reducing it or them, so as to be enforceable to the extent
compatible with the applicable law.exv10w5

 EXHIBIT 10.5 

 

TEXTRON SPILLOVER SAVINGS PLAN

 

Effective January 1, 2009

 

 

 

Textron Spillover Savings Plan

Effective January 1, 2009

Table of Contents

	 	 	 	 	 
	Introduction
	 	 	1	 
	 
	 	 	 	 
	Article I – Definitions
	 	 	2	 
	1.01 Account
	 	 	2	 
	1.02 Beneficiary
	 	 	2	 
	1.03 Benefits Committee
	 	 	2	 
	1.04 Board
	 	 	2	 
	1.05 Change in Control
	 	 	2	 
	1.06 Compensation
	 	 	4	 
	1.07 ERISA
	 	 	4	 
	1.08 Executive Plan
	 	 	4	 
	1.09 IRC
	 	 	4	 
	1.10 Key Executive
	 	 	4	 
	1.11 Key Executive Plan
	 	 	4	 
	1.12 Participant
	 	 	4	 
	1.13 Plan
	 	 	4	 
	1.14 Plan Administrator
	 	 	4	 
	1.15 Qualified Savings Plan
	 	 	4	 
	1.16 Separation From Service
	 	 	5	 
	1.17 Supplemental Shares
	 	 	5	 
	1.18 Statutory Limit
	 	 	5	 
	1.19 Textron
	 	 	5	 
	1.20 Textron Company
	 	 	5	 
	1.21 Total Disability
	 	 	5	 
	 
	 	 	 	 
	Article II – Participation
	 	 	5	 
	2.01 Eligibility and Participation
	 	 	5	 
	2.02 Period of Participation
	 	 	5	 
	 
	 	 	 	 
	Article III – Spillover Savings Benefit
	 	 	6	 
	3.01 Supplemental Matching Contribution
	 	 	6	 
	3.02 Crediting Contributions
	 	 	6	 
	3.03 Crediting Dividends and other Adjustments
	 	 	6	 
	3.04 Converting Supplemental Shares to Cash
	 	 	7	 
	 
	 	 	 	 
	Article IV – Vesting
	 	 	7	 
	4.01 Vesting Schedule
	 	 	7	 
	4.02 Change in Control
	 	 	7	 

			
	 	 	 
	Textron Spillover Savings Plan
	 	Table of Contents
	Effective January 1, 2009
	 	Page i

 

 

Table of Contents

	 	 	 	 	 
	Article V – Distribution of Accounts
	 	 	7	 
	5.01 Separation From Service
	 	 	7	 
	5.02 Disability or Death
	 	 	7	 
	5.04 Distribution Upon Change in Control
	 	 	8	 
	5.05 Distributions Before July 25, 2007
	 	 	8	 
	 
	 	 	 	 
	Article VI – Unfunded Plan
	 	 	8	 
	6.01 No Plan Assets
	 	 	8	 
	6.02 Top-Hat Plan Status
	 	 	8	 
	 
	 	 	 	 
	Article VII – Plan Administration
	 	 	8	 
	7.01 Plan Administrator’s Powers
	 	 	8	 
	7.02 Tax Withholding
	 	 	9	 
	7.03 Use of Third Parties to Assist with Plan Administration
	 	 	9	 
	7.04 Proof of Right to Receive Benefits
	 	 	9	 
	7.05 Claims Procedure
	 	 	9	 
	7.06 Enforcement Following a Change in Control
	 	 	10	 
	 
	 	 	 	 
	Article VIII – Amendment and Termination
	 	 	11	 
	8.01 Amendment
	 	 	11	 
	8.02 Termination
	 	 	11	 
	8.03 Distributions Upon Plan Termination
	 	 	12	 
	 
	 	 	 	 
	Article IX – Miscellaneous
	 	 	12	 
	9.01 Use of Masculine or Feminine Pronouns
	 	 	12	 
	9.02 Transferability of Plan Benefits
	 	 	12	 
	9.03 Section 409A Compliance
	 	 	13	 
	9.04 Controlling State Law
	 	 	13	 
	9.05 No Right to Employment
	 	 	13	 
	9.06 Additional Conditions Imposed
	 	 	13	 

			
	 	 	 
	Textron Spillover Savings Plan 

Effective January 1, 2009
	 	Table of Contents

Page ii

 

 

Textron Spillover Savings Plan

Effective January 1, 2009

Introduction

The Textron Spillover Savings Plan (the “Plan”) is an unfunded, nonqualified deferred compensation
arrangement. The Plan is a continuation of the defined contribution portions of the Supplemental
Benefits Plan for Textron Key Executives (the “Key Executive Plan”) and the Textron Supplemental
Benefits Plan for Executives (the “Executive Plan”). The defined contribution portions of these
plans were separated from the defined benefit portions of the plans effective January 1, 2007, and
the defined benefit portions were combined to form the Textron Spillover Pension Plan. The defined
contribution portions of the Key Executive Plan and the Executive Plan were continued as separate
plans, the Supplemental Savings Plan for Textron Key Executives and the Textron Supplemental
Savings Plan for Executives, on and after January 1, 2007. These two plans are now being combined,
effective January 1, 2008, to form the Textron Spillover Savings Plan.

The Plan provides supplemental savings benefits for designated executives of Textron and its
affiliates who participate in the Textron Savings Plan. The Plan provides benefits that would have
been payable under the Textron Savings Plan if not for the limits imposed by the Internal Revenue
Code of 1986, as amended (the “IRC”).

Appendix A and Appendix B of the Plan set forth the defined contribution provisions of the Key
Executive Plan and the Executive Plan as in effect on October 3, 2004, when IRC Section 409A was
enacted as part of the American Jobs Creation Act of 2004. Supplemental savings benefits that were
earned and vested (within the meaning of Section 409A) before January 1, 2005, and any subsequent
increase that is permitted to be included in such amounts under IRC Section 409A, are calculated
and paid solely as provided in Appendix A or Appendix B, whichever is applicable, and are not
subject to any other provisions of the Textron Spillover Savings Plan.

A Key Executive’s supplemental savings benefits that were earned or vested after 2004 and before
January 1, 2008, under the Key Executive Plan are subject to the provisions of IRC Section 409A.
These benefits are calculated under Appendix A, but are paid exclusively as provided in the Textron
Spillover Savings Plan (not including Appendix A). Although the provisions of the Textron
Spillover Savings Plan generally are effective as of January 1, 2008, the provisions that govern
the distribution of benefits earned or vested after 2004 under the Key Executive Plan are effective
as of January 1, 2005.

Supplemental savings benefits provided under the Executive Plan generally are paid out no later
than March 15 following the year in which the benefits are credited to a participant’s account. In
a few cases, however, supplemental savings benefits that were earned and vested under the Executive
Plan before January 1, 2005, remained unpaid as of the date on which this Plan was established.
These benefits will be paid to the

			
	 	 	 
	Textron Spillover Savings Plan	 	 
	Effective January 1, 2009
	 	Page 1

 

 

Participants in a lump sum in January of 2008. Any benefits that were credited under the Executive
Plan between January 1, 2007, and December 31, 2007, shall be paid exclusively as provided in
Appendix B.

Appendix A permits a Participant to request a distribution option for the benefits payable under
that Appendix. This special election provision is effective as of July 25, 2007, the date on which
the Plan was adopted by the Board.

Article I – Definitions

The following terms shall have the meanings set forth in this Article, unless a contrary or
different meaning is expressly provided:

	1.01	 	“Account” means the bookkeeping entry used to record supplemental matching contributions and
earnings credited to a Participant under the Plan. All amounts credited to the Account shall
be unfunded obligations of Textron: no assets shall be set aside or contributed to the Plan
for the Participant’s benefit. A Key Executive’s Account does not include supplemental
savings benefits that were earned and vested (within the meaning of IRC Section 409A) before
January 1, 2005, and any subsequent increase that is permitted to be included in such amounts
under IRC Section 409A, which are calculated and paid solely as provided in Appendix A.
	 
	1.02	 	“Beneficiary” means the person designated under the Plan (including any person who is
automatically designated by the terms of the Plan) to receive any death benefit payable with
respect to a Participant. A Participant’s trust or estate may also be the Participant’s
Beneficiary.
	 
	1.03	 	“Benefits Committee” means the Employee Benefits Committee of Textron.
	 
	1.04	 	“Board” means the Board of Directors of Textron.
	 
	1.05	 	“Change in Control” means, for any Participant who was not an employee of a Textron Company
on December 31, 2007:

	 	(a)	 	any “person” or “group” (within the meaning of Sections 13(d) and 14(d)(2) of
the Securities Exchange Act of 1934, as amended (the “Act”) and of IRC Section 409A)
other than Textron, any trustee or other fiduciary holding Textron common stock under
an employee benefit plan of Textron or a related company, or any corporation which is
owned,
directly or indirectly, by the stockholders of Textron in substantially similar
proportions as their ownership of Textron common stock

			
	 	 	 
	Textron Spillover Savings Plan	 	 
	Effective January 1, 2009
	 	Page 2

 

 

	 	(1)	 	becomes (other than by acquisition from Textron or a related
company) the “beneficial owner” (as defined in Rule 13d-3 under the Act) of
stock of Textron that, together with other stock held by such person or group,
possesses more than 50% of the combined voting power of Textron’s
then-outstanding voting stock, or
	 
	 	(2)	 	acquires (or has acquired during the 12-month period ending
on the date of the most recent acquisition by such person) beneficial
ownership of stock of Textron possessing more than 30% of the combined voting
power of Textron’s then-outstanding stock, or
	 
	 	(3)	 	acquires (or has acquired during the 12-month period ending
on the date of the most recent acquisition by such person) all or
substantially all of the total gross fair market value of all of the assets of
Textron immediately prior to such acquisition or acquisitions (where gross
fair market value is determined without regard to any associated liabilities);
or

	 	(b)	 	a merger or consolidation of Textron with any other corporation occurs, other
than a merger or consolidation that would result in the voting securities of Textron
outstanding immediately before the merger or consolidation continuing to represent
(either by remaining outstanding or by being converted into voting securities of the
surviving entity) 50% or more of the combined voting power of the voting securities of
Textron or such surviving entity outstanding immediately after such merger or
consolidation, or
	 
	 	(c)	 	during any 12-month period, a majority of the members of the Board is
replaced by directors whose appointment or election is not endorsed by a majority of
the members of the Board of Directors before the date of their appointment or
election.

Each of the events described above will be treated as a “Change in Control” only to the
extent that it is a change in ownership, change in effective control, or change in the
ownership of a substantial portion of Textron’s assets within the meaning of IRC Section
409A.

For any Participant who was an employee of a Textron Company on December 31, 2007, the
definition set forth above in this Section 1.05 shall be used to determine whether an event
is a “Change in Control” to the extent that the event would alter the time or form of
payment of the Participant’s benefit. To the extent
that the event would cause any change in the Participant’s rights under the Plan that does
not affect the status of the Participant’s benefit under IRC Section 409A (including, but
not limited to, accelerated vesting of the Participant’s benefit or

			
	 	 	 
	Textron Spillover Savings Plan	 	 
	Effective January 1, 2009
	 	Page 3

 

 

restrictions on
amendments to the Plan), the definition set forth in Section 7.03 of Appendix A shall be
used to determine whether the event is a “Change in Control.”

	1.06	 	“Compensation” means a Participant’s eligible annual compensation as defined in the Qualified
Savings Plan in which he participates, and any annual compensation that would be eligible
under the Qualified Savings Plan if the Participant’s deferral election under the Deferred
Income Plan for Textron Executives were disregarded, but determined (in each case) without
regard to the Statutory Limit.
	 
	1.07	 	“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
	 
	1.08	 	“Executive Plan” means the Textron Supplemental Benefits Plan for Executives, as in effect
before January 1, 2007, and the Textron Supplemental Savings Plan for Executives, as in effect
from January 1 through December 31, 2007.
	 
	1.09	 	“IRC” means the Internal Revenue Code of 1986, as amended. References to any section of the
Internal Revenue Code shall include any final regulations interpreting that section.
	 
	1.10	 	“Key Executive” means an employee of a Textron Company who has been and continues to be
designated as a Key Executive under the Plan by Textron’s Chief Executive Officer and Chief
Human Resources Officer.
	 
	1.11	 	“Key Executive Plan” means the Supplemental Benefits Plan for Textron Key Executives, as in
effect before January 1, 2007, and the Supplemental Savings Plan for Textron Key Executives,
as in effect from January 1 through December 31, 2007. The defined contribution provisions of
the Key Executive Plan are included in this Plan as Appendix A.
	 
	1.12	 	“Participant” means an employee of Textron who is eligible to participate in the Plan
pursuant to Section 2.01 and whose participation has not been terminated as provided in
Section 2.01.
	 
	1.13	 	“Plan” means this Textron Spillover Savings Plan, as amended and restated from time to time.
	 
	1.14	 	“Plan Administrator” means Textron or its designees, as described in Section 7.01.
	 
	1.15	 	“Qualified Savings Plan” means the Textron Savings Plan or another tax-qualified defined
contribution plan maintained by a Textron Company that has been designated by the Management
Committee of Textron as eligible for supplemental

			
	 	 	 
	Textron Spillover Savings Plan	 	 
	Effective January 1, 2009
	 	Page 4

 

 

	 	 	contributions under the Plan. Any Qualified
Savings Plan other than the Textron Savings Plan shall be identified in an appendix to this
Plan, and the appendix shall also set forth any special terms or conditions that apply to
participants in the Qualified Savings Plan.
	 
	1.16	 	“Separation From Service” means a Participant’s termination of employment with all Textron
Companies, other than by reason of death or Total Disability, that qualifies as a “separation
from service” for purposes of IRC Section 409A.
	 
	1.17	 	“Supplemental Shares” means phantom shares of Textron common stock accumulated and accounted
for under the Plan for the purpose of determining the cash value of distributions from a
Participant’s Account.
	 
	1.18	 	“Statutory Limit” means the limit on eligible compensation under tax-qualified defined
contribution plans imposed by IRC Section 401(a)(17) or the limit on annual additions imposed
by IRC Section 415.
	 
	1.19	 	“Textron” means Textron Inc., a Delaware corporation, and any successor to Textron Inc.
	 
	1.20	 	“Textron Company” means Textron or any company controlled by or under common control with
Textron within the meaning of IRC Section 414(b) or (c).
	 
	1.21	 	“Total Disability” means physical or mental incapacity of a Participant who is employed by a
Textron Company on the disability date, if the incapacity (a) enables the Participant to
receive disability benefits under the Federal Social Security Act, and (b) also qualifies as a
“disability” for purposes of IRC Section 409A(a)(2)(C).

Article II – Participation

	2.01	 	Eligibility. An employee of a Textron Company who is a United States citizen or
resident and who
participates in a Qualified Savings Plan shall become a participant in the Plan when his
matching contribution under the Qualified Savings Plan is limited by the Statutory Limit.
	 
	2.02	 	Period of Participation. Except as provided in the following sentence, once an
individual becomes a Participant under Section 2.01 above, the individual shall remain a
Participant until the individual’s Account is fully distributed, or until the individual’s
participation in the Plan is terminated by the Board (or by the Chief Executive Officer and
the Chief Human Resources Officer) effective as of the following January 1. If an employee or
former employee is not identified in Textron’s records as a Participant as of December 31,
2008, the individual shall

			
	 	 	 
	Textron Spillover Savings Plan	 	 
	Effective January 1, 2009
	 	Page 5

 

 

not be a Participant, and shall not be entitled to receive any
benefit under the Plan, unless the individual either (i) becomes a Participant after 2008
pursuant to Section 2.01, or (ii) is designated by the Board (or by the Chief Executive
Officer and Chief Human Resources Officer) as a Participant after 2008.

Article III – Spillover Savings Benefit

	3.01	 	Supplemental Matching Contribution. If a Participant contributes at least 10% of
eligible compensation to the Textron Savings Plan during a calendar year, the Participant’s
Account under the Plan shall be credited with a supplemental matching contribution equal to
(1) 5% [i.e., 50% of 10%] of the Participant’s Compensation, reduced by (2) the Participant’s
actual matching contribution for the calendar year under the Textron Savings Plan. If a
Participant participates in a Qualified Savings Plan other than the Textron Savings Plan, the
Participant shall receive a comparable supplemental matching contribution in an amount
sufficient to restore the portion of the matching contribution lost because of the application
of the Statutory Limit to eligible compensation under the Qualified Savings Plan. The
Participant must be employed by a Textron Company on December 31 of the calendar year in order
to receive a supplemental matching contribution for that calendar year.
	 
	3.02	 	Crediting Contributions. Textron shall credit the supplemental matching contribution
to a Participant’s Account after the end of the calendar year for which the supplemental
matching contribution is made, but not later than March 15 of the following year. The credit
shall be made as a number of Supplemental Shares determined by dividing the amount of the
supplemental matching contribution for the calendar year by the average of the composite
closing prices of Textron common stock, as reported in The Wall Street Journal for each
trading day in the calendar year for which the credit is made.
	 
	3.03	 	Crediting Dividend Equivalents and Other Adjustments. Textron shall credit additional
Supplemental Shares to a Participant’s Account in each calendar quarter to reflect the
dividend equivalents attributable to the Supplemental Shares that were credited to the
Participant’s Account on the record date. The number of additional Supplemental Shares shall
be determined by dividing the dividend amount by the average of the composite closing prices
of Textron common stock, as reported in The Wall Street Journal for the month in which the
record date occurs. The number of Supplemental Shares credited to a Participant’s Account
shall be adjusted, without receipt of any consideration by Textron, on account of any stock
split, stock dividend, or similar increase or decrease affecting Textron common stock, as if
the Supplemental Shares were actual shares of Textron common stock.

			
	 	 	 
	Textron Spillover Savings Plan	 	 
	Effective January 1, 2009
	 	Page 6

 

 

	3.04	 	Converting Supplemental Shares to Cash. All distributions from the Plan shall be
made in cash. The cash value distributed will be determined by multiplying the current value
of Textron common stock by the number of whole and fractional Supplemental Shares in the
Participant’s Account as of the distribution date. The current value of a share of Textron
common stock on the distribution date shall be the average of the composite closing prices, as
reported in The Wall Street Journal, for the first ten trading days of the calendar month
following the Participant’s Separation From Service, death, or Total Disability.

Article IV – Vesting

	4.01	 	Vesting Schedule. Except as provided in Section 4.02, a Participant’s Account shall
be vested to the same extent that the Participant’s matching contribution account under the
Qualified Savings Plan is vested. Any portion of the Participant’s Account that is not vested
at the time of the Participant’s Separation From Service shall be forfeited.
	 
	4.02	 	Change in Control. In the event of a Change in Control, a Participant’s Account
shall become fully vested if the Participant is employed by a Textron Company on the date of
the Change in Control.

Article V – Distribution of Accounts

	5.01	 	Separation From Service. A Participant’s Account shall be distributed in a lump sum
in cash on the first
business day of the seventh month following his Separation From Service (or in January
2009, if later).
	 
	5.02	 	Disability or Death. If a Participant dies before his Account is distributed, the
Participant’s Account shall be distributed in a lump sum in cash on the first business day of
the first month that begins at least ninety (90) days after the Participant’s death. If a
Participant suffers a Total Disability before his Account is distributed, the Participant’s
Account shall be distributed in a lump sum in cash on the last business day of the month
following his Total Disability. The Participant’s Beneficiary under the Plan shall be the
same as the Participant’s beneficiary under the Qualified Savings Plan. If a Beneficiary is
receiving installment payments as of December 31, 2007, any remaining installments due after
2007 shall be aggregated and paid in a lump sum on the first business day of January 2008.
	 
	5.03	 	Administrative Adjustments in Payment Date. A payment is treated as being made on
the date when it is due under the Plan if the payment is made on the due date specified by the
Plan, or on a later date that is either (a) in the same calendar year (for a payment whose
specified due date is on or before September 30), or (b) by the 15th day of the third calendar
month following the date specified by the

			
	 	 	 
	Textron Spillover Savings Plan	 	 
	Effective January 1, 2009
	 	Page 7

 

 

	 	 	Plan (for a payment whose specified due date is on
or after October 1). A payment also is treated as being made on the date when it is due under
the Plan if the payment is made not more than 30 days before the due date specified by the
Plan, provided that the payment is not made earlier than six months after the Participant’s
Separation From Service. A Participant may not, directly or indirectly, designate the taxable
year of a payment made in reliance on the administrative rules in this Section 5.03.

	5.04	 	Distribution Upon Change in Control. Subject to the following sentence, if a Change
in Control also qualifies as a “change in control” under IRC Section 409A, the Participant’s
Account shall be paid in a lump sum in cash on the first business day of the month following
the Change in Control. If a Participant’s Separation From Service occurred before the Change
in Control, the lump sum payment under this Section 5.04 shall not be made earlier than six
months after the Participant’s Separation From Service.
	 
	5.05	 	Distributions Before January 1, 2008. Distributions after 2004 and before the
effective date of the Plan were made in good faith compliance with IRC Section 409A and
Internal Revenue Service guidance interpreting IRC Section 409A.

Article VI – Unfunded Plan

	6.01	 	No Plan Assets. Benefits provided under this Plan are unfunded obligations of
Textron. Nothing contained in this Plan shall require Textron to segregate any monies from
its general funds, to create any trust, to make any special deposits, or to purchase any
policies of insurance with respect to such obligations. If Textron elects to purchase
individual policies of insurance on one or more of the Participants to help finance its
obligations under this Plan, such individual policies and the proceeds of the policies shall
at all times remain the sole property of Textron and neither the Participants whose lives are
insured not their Beneficiaries shall have any ownership rights in such policies of insurance.
	 
	6.02	 	Top-Hat Plan Status. The Plan is maintained primarily for the purpose of providing
deferred compensation for a select group of management or highly compensated employees within
the meaning of Sections 201(2), 301(a)(3), and 401(a)(1) of the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”).

Article VII – Plan Administration

	7.01	 	Plan Administrator’s Powers. Textron shall have all such powers as may be necessary
to carry out the provisions hereof. Textron may from time to time establish rules for the
administration of this Plan and the transaction of its business. Subject to Section 7.05, any
actions by Textron shall be final, conclusive and binding on each Participant and all persons
claiming by, through

			
	 	 	 
	Textron Spillover Savings Plan	 	 
	Effective January 1, 2009
	 	Page 8

 

 

	 	 	or under any Participant. Textron (and any person or persons to whom it
delegates any of its authority as plan administrator) shall have discretionary authority to
determine eligibility for Plan benefits, to construe the terms of the Plan, and to determine
all questions arising in the administration of the Plan.

	7.02	 	Tax Withholding. Textron may withhold from benefits paid under this Plan any taxes
or other amounts required by law to be withheld. Textron may deduct from the undistributed
portion of a Participant’s benefit any employment tax that Textron reasonably determines to be
due with respect to the benefit under the Federal Insurance Contributions Act (FICA), and an
amount sufficient to pay the income tax withholding related to such FICA tax. Alternatively,
Textron may require the Participant or Beneficiary to remit to Textron or its designee an
amount sufficient to satisfy any applicable federal, state, and local income and employment
tax with respect to the Participant’s benefit. The Participant or Beneficiary shall remain
responsible at all times for paying any federal, state, or local income or employment tax with
respect to any benefit under this Plan. In no event shall Textron or any employee
or agent of Textron be liable for any interest or penalty that a Participant or Beneficiary
incurs by failing to make timely payments of tax.
	 
	7.03	 	Use of Third Parties to Assist with Plan Administration. Textron may employ or
engage such agents, accountants, actuaries, counsel, other experts and other persons as it
deems necessary or desirable in connection with the interpretation and administration of this
Plan. Textron and its committees, officers, directors and employees shall not be liable for
any action taken, suffered or omitted by them in good faith in reliance upon the advice or
opinion of any such agent, accountant, actuary, counsel or other expert. All action so taken,
suffered or omitted shall be conclusive upon each of them and upon all other persons
interested in this Plan.
	 
	7.04	 	Proof of Right to Receive Benefits. Textron may require proof of death or Total
Disability of any Participant and evidence of the right of any person to receive any Plan
benefit.
	 
	7.05	 	Claims Procedure. A Participant or Beneficiary who believes that he is being denied a
benefit to which he is entitled under the Plan (referred to in this Section 7.05 as a
“Claimant”) may file a written request with the Benefits Committee setting forth the claim.
The Benefits Committee shall consider and resolve the claim as set forth below.

	 	(a)	 	Time for Response. Upon receipt of a claim, the Benefits Committee
shall advise the Claimant that a response will be forthcoming within 90 days. The
Benefits Committee may, however, extend the response period for up to an additional 90
days for reasonable cause, and shall notify the

			
	 	 	 
	Textron Spillover Savings Plan	 	 
	Effective January 1, 2009
	 	Page 9

 

 

Claimant of the reason for the
extension and the expected response date. The Benefits Committee shall respond to the
claim within the specified period.

	 	(b)	 	Denial. If the claim is denied in whole or part, the Benefits
Committee shall provide the Claimant with a written decision, using language
calculated to be understood by the Claimant, setting forth (1) the specific reason or
reasons for such denial; (2) the specific reference to relevant provisions of this
Plan on which such denial is based; (3) a description of any additional material or
information necessary for the Claimant to perfect his claim and an explanation why
such material or such information is necessary; (4) appropriate information as to the
steps to be taken if the Claimant wishes to submit the claim for review; (5) the time
limits for requesting a review of the claim; and (6) the Claimant’s right to bring an
action for benefits under Section 502(a) of ERISA.
	 
	 	(c)	 	Request for Review. Within 60 days after the Claimant’s receipt of
the written decision denying the claim in whole or in part, the Claimant may request
in writing that the Benefits Committee review the determination. The Claimant or his
duly authorized representative may, but need not, review the relevant documents and
submit issues and comment in writing for consideration by the Benefits Committee. If
the Claimant does not request a review of the initial determination within such 60-day
period, the Claimant shall be barred from challenging the determination.
	 
	 	(d)	 	Review of Initial Determination. Within 60 days after the Benefits
Committee receives a request for review, it will review the initial determination. If
special circumstances require that the 60-day time period be extended, the Benefits
Committee will so notify the Claimant and will render the decision as soon as
possible, but no later than 120 days after receipt of the request for review.
	 
	 	(e)	 	Decision on Review. All decisions on review shall be final and
binding with respect to all concerned parties. The decision on review shall set
forth, in a manner calculated to be understood by the Claimant, (1) the specific
reasons for the decision, shall including references to the relevant Plan provisions
upon which the decision is based; (2) the Claimant’s right to receive, upon request
and free of charge, reasonable access to and copies of all documents, records, and
other information, relevant to his benefits; and (3) the Claimant’s right to bring a
civil action under Section 502(a) of ERISA.

	7.06	 	Enforcement Following a Change in Control. If, after a Change in Control, any claim
is made or any litigation is brought by a Participant or Beneficiary to enforce or interpret
any provision contained in this Plan, Textron and the

			
	 	 	 
	Textron Spillover Savings Plan	 	 
	Effective January 1, 2009
	 	Page 10

 

 

	 	 	“person” or “group” described in Section
1.05 shall be liable, jointly and severally, to reimburse the Participant or Beneficiary for
the Participant’s or Beneficiary’s reasonable attorney’s fees and costs incurred during the
Participant’s or Beneficiary’s lifetime in pursuing any such claim or litigation, and to pay
prejudgment interest at the Prime Rate as quoted in the Money Rates section of The Wall Street
Journal on any money award or judgment obtained by the Participant or Beneficiary, payable at
the same time as the underlying award or judgment. Any reimbursement pursuant to the
preceding sentence shall be paid to the Participant no earlier than six months after the
Participant’s Separation From Service, and shall be paid to the Participant or Beneficiary no
later than the end of the calendar year following the year in which the expense was incurred.
The reimbursement shall not be subject to liquidation or exchange for another benefit, and the
amount of reimbursable expense incurred in one year shall not affect the amount of
reimbursement available in another year.

Article VIII – Amendment and Termination

	8.01	 	Amendment. Subject to subsections (a) and (b), below, the Board or its designee
shall have the right to amend, modify, or suspend this Plan at any time by written resolution
or other formal action reflected in writing. Subject to subsections (a) and (b), below, the
Management Committee of Textron or its designee also shall have the right to amend, modify, or
suspend any provisions of this Plan, by written resolution or other formal action reflected in
writing, with respect to any Participant who is not a member of the Management Committee or a
Key Executive.

	 	(a)	 	No amendment, modification, or suspension shall reduce the amount credited to
a Participant’s Account immediately before the effective date of the amendment,
modification, or suspension.
	 
	 	(b)	 	Following a Change in Control, no amendment, modification, or suspension
shall be made that directly or indirectly reduces any right or benefit provided upon a
Change in Control.

An amendment to the Qualified Savings Plan that affects the benefits provided under this
Plan shall not be deemed to be an amendment to this Plan, and shall not be subject to the
restrictions in subsections (a) and (b), provided that the amendment to the Qualified
Savings Plan applies to a broad cross-section of participants in the Qualified Savings
Plan, and not only or primarily to Participants in this Plan.

	8.02	 	Termination. The Board or its designee shall have the right to terminate this Plan
at any time before a Change in Control by written resolution. No termination of

			
	 	 	 
	Textron Spillover Savings Plan	 	 
	Effective January 1, 2009
	 	Page 11

 

 

	 	 	the Plan
shall reduce a Participant’s Account immediately before the effective date of the termination.
	 
	8.03	 	Distributions Upon Plan Termination. Upon the termination of the Plan by the Board
with respect to all Participants, and termination of all arrangements sponsored by any Textron
Company that would be aggregated with the Plan under IRC Section 409A, Textron shall have the
right, in its sole discretion, and notwithstanding any elections made by the Participant, to
pay the Participant’s vested Account in a lump sum, to the extent permitted under IRC Section
409A. All payments that may be made pursuant to this Section 8.03 shall be made no earlier
than the thirteenth month and no later than the twenty-fourth month after the termination of
the Plan. Textron may not accelerate payments pursuant to this Section 8.03 if the
termination of the Plan is proximate to a downturn in Textron’s financial
health. If Textron exercises its discretion to accelerate payments under this Section
8.03, it shall not adopt any new arrangement that would have been aggregated with the Plan
under IRC Section 409A within three years following the date of the Plan’s termination.

Article IX – Miscellaneous

	9.01	 	Use of Masculine or Feminine Pronouns. Unless a contrary or different meaning is
expressly provided, each use in this Plan of the masculine or feminine gender shall include
the other and each use of the singular number shall include the plural.
	 
	9.02	 	Transferability of Plan Benefits.

	 	(a)	 	Textron shall recognize the right of an alternate payee named in a domestic
relations order to receive all or a portion of a Participant’s benefit under the Plan,
provided that (1) the domestic relations order would be a “qualified domestic
relations order” within the meaning of IRC Section 414(p) if IRC Section 414(p) were
applicable to the Plan (except that the order may require payment to be made to the
alternate payee before the Participant’s earliest retirement age), (2) the domestic
relations order does not purport to give the alternate payee any right to assets of
any Textron Company, (3) the domestic relations order does not purport to allow the
alternate payee to defer payments beyond the date when the benefits assigned to the
alternate payee would have been paid to the Participant, and (4) the domestic
relations order does not require the Plan to make a payment to an alternate payee in
any form other than a cash lump sum.
	 
	 	(b)	 	Except as provided in subsection (a) concerning domestic relations orders, no
amount payable at any time under this Plan shall be subject in any

			
	 	 	 
	Textron Spillover Savings Plan	 	 
	Effective January 1, 2009
	 	Page 12

 

 

manner to
alienation, sale, transfer, assignment, pledge or encumbrance of any kind to the
extent that the assignment or other action would cause the amount to be included in
the Participant’s gross income or treated as a distribution for federal income tax
purposes. A Participant may, with the written approval of the Benefits Committee,
make an assignment of a benefit for estate planning or similar purposes if the
assignment does not cause the amount to be included in the Participant’s gross income
or treated as a distribution for federal income tax purposes. Any attempt to
alienate, sell, transfer, assign, pledge or otherwise encumber any such benefit,
whether presently or subsequently payable, shall be void unless so approved. Except
as required by law, no benefit payable under this Plan
shall in any manner be subject to garnishment, attachment, execution or other legal
process, or be liable for or subject to the debts or liability of any Participant
or Beneficiary.

	9.03	 	Section 409A Compliance. The Plan is intended to comply with IRC Section 409A and
should be interpreted accordingly. Any distribution election that would not comply with IRC
Section 409A is not effective. To the extent that a provision of this Plan does not comply
with IRC Section 409A, such provision shall be void and without effect. Textron does not
warrant that the Plan will comply with IRC Section 409A with respect to any Participant or
with respect to any payment, however. In no event shall any Textron Company; any director,
officer, or employee of a Textron Company (other than the Participant); or any member of the
Benefits Committee be liable for any additional tax, interest, or penalty incurred by a
Participant or Beneficiary as a result of the Plan’s failure to satisfy the requirements of
IRC Section 409A, or as a result of the Plan’s failure to satisfy any other requirements of
applicable tax laws.
	 
	9.04	 	Controlling State Law. This Plan shall be construed in accordance with the laws of
the State of Delaware.
	 
	9.05	 	No Right to Employment. Nothing contained in this Plan shall be construed as a
contract of employment between any Participant and any Textron Company, or to suggest or
create a right in any Participant of continued employment at any Textron Company.
	 
	9.06	 	Additional Conditions Imposed. Textron, the Chief Executive Officer and the Chief
Human Resources Officer, and the Benefits Committee may impose such other lawful terms and
conditions on participation in this Plan as deemed desirable. The Chief Executive Officer,
the Chief Human Resources Officer, and members of the Benefits Committee may participate in
this Plan.

			
	 	 	 
	Textron Spillover Savings Plan	 	 
	Effective January 1, 2009
	 	Page 13

 

 

 

TEXTRON SPILLOVER SAVINGS PLAN

 

APPENDIX
A

 

Defined Contribution Provisions

of the

Supplemental Benefits Plan for

Textron Key Executives

(As in effect before January 1, 2008)

 

 

 

Textron Spillover Savings Plan

Appendix A — Key Executive Plan

Table of Contents

	 	 	 	 	 
	Introduction
	 	 	1	 
	 
	 	 	 	 
	Article I—Definitions
	 	 	3	 
	 
	 	 	 	 
	Article II—Participation
	 	 	4	 
	 
	 	 	 	 
	Article III—Supplemental Savings Benefits
	 	 	4	 
	 
	 	 	 	 
	Article IV—Supplemental Included Plan Benefits
	 	 	5	 
	 
	 	 	 	 
	Article V—Unfunded Plan
	 	 	5	 
	 
	 	 	 	 
	Article VI—Plan Administration
	 	 	5	 
	 
	 	 	 	 
	Article VII—Miscellaneous
	 	 	7	 
	 
	 	 	 	 
	Market Square Profit Sharing Plan Schedule
	 	 	 	 

			
	 	 	 
	Textron Spillover Savings Plan
	 	Appendix A
	Effective January 1, 2009
	 	Page i

 

 

Textron Spillover Savings Plan

Appendix A — Key Executive Plan

Introduction

	A.	 	Key Executive Plan
	 	 	(As in Effect Before January 1, 2007)

Before 2007, the Supplemental Benefits Plan for Textron Key Executives (the “Key Executive Plan”)
was a separate unfunded, nonqualified deferred compensation arrangement for designated key
executives of Textron and its affiliates. The Key Executive Plan supplemented key executives’
benefits under Textron’s tax-qualified defined benefit plans and tax-qualified defined contribution
plans by providing benefits that exceeded the statutory limits under the Internal Revenue Code
(“IRC”). The Key Executive Plan also provided supplemental pension benefits based on certain
elements of key executives’ compensation that were not included in pensionable compensation under
the tax-qualified defined benefit plans.

	B.	 	Supplemental Savings Plan for Textron Key Executives
	 	 	(Effective January 1, 2007)

Effective January 1, 2007, the defined benefit portion of the Key Executive Plan was separated from
the defined contribution portion of the Key Executive Plan. The defined benefit portion of the Key
Executive Plan continued as part of the Textron Spillover Pension Plan, and the defined
contribution portion of the Key Executive Plan continued as a separate plan, the Supplemental
Savings Plan for Textron Key Executives.

	C.	 	Textron Spillover Savings Plan
	 	 	(Effective January 1, 2008)

Effective January 1, 2008, the Supplemental Savings Plan for Textron Key Executives and the Textron
Supplemental Savings Plan for Executives were merged to form the Textron Spillover Savings Plan.

	D.	 	Key Executive Protected Benefits
	 	 	(Earned and Vested Before 2005)

The portion of Appendix A that follows this Introduction sets forth the defined contribution
provisions of the Key Executive Plan as in effect on October 3, 2004, when IRC Section 409A was
enacted as part of the American Jobs Creation Act of 2004, with certain modifications imposing
additional restrictions on distributions and changing provisions for measuring investment returns.
Key Executives’ supplemental savings benefits that were earned and vested (within the meaning of
Section 409A) before January 1, 2005, and any subsequent increase that is permitted to be included
in such amounts under Section 409A (“Key Executive Protected

			
	 	 	 
	Textron Spillover Savings Plan
	 	Appendix A
	Effective January 1, 2009
	 	Page 1

 

 

Benefits”), are calculated and paid solely as provided in Appendix A, and are not subject to any
other provisions of the Textron Spillover Savings Plan.

The Key Executive Protected Benefits are not intended to be subject to IRC Section 409A. No
amendment to this Appendix A that would constitute a “material modification” for purposes of
Section 409A shall be effective unless the amending instrument states that it is intended to
materially modify Appendix A and to cause the Key Executive Protected Benefits to become subject to
Section 409A. Although the Key Executive Protected Benefits are not intended to be subject to
Section 409A, no Textron Company (nor any director, officer, or other representative of a Textron
Company) shall be liable for any adverse tax consequence suffered by a Participant or beneficiary
if a Key Executive Protected Benefit becomes subject to Section 409A.

	E.	 	Benefits Subject To Section 409A
	 	 	(Earned or Vested From 2005 Through 2007)

Supplemental savings benefits earned by Key Executives after 2004, and supplemental savings
benefits that became vested after 2004, are subject to the provisions of IRC Section 409A. To the
extent that these benefits were earned under the Key Executive Plan before January 1, 2008, the
benefits shall be calculated under the provisions of the Key Executive Plan set forth in this
Appendix A. However, any benefits earned or vested under the Key Executive Plan after 2004 shall
be paid exclusively as provided in the Textron Spillover Savings Plan (not including any appendix
to the Textron Spillover Savings Plan), and shall not be subject to any provision of Appendix A
that relates to the payment or distribution of benefits. Although the provisions of the Textron
Spillover Savings Plan generally are effective as of January 1, 2008, the provisions that govern
the distribution of benefits earned or vested after 2004 under the Key Executive Plan are effective
as of January 1, 2005.

Section 6.02(c) of Appendix A requires a Participant to make an election if the Participant wishes
to request one of the distribution options in Section 6.02. Section 1.08 of the Market Square
Profit Sharing Plan Schedule requires a Participant to make an election if the Participant wishes
to request one of the distribution options in Section 1.08. These election provisions are
effective as of July 25, 2007, the date on which the Plan was adopted by the Board.

Key Executive Plan

The text that follows sets forth the defined contribution provisions of the Key Executive Plan as
in effect on October 3, 2004, and as modified thereafter in certain respects that do not constitute
“material modifications” for purposes of IRC Section 409A. The defined terms in Appendix A relate
only to the provisions set forth in Appendix A: they do not apply to any other provisions of the
Textron Spillover Savings Plan, and terms defined elsewhere in the Textron Spillover Savings Plan
do not apply to Appendix A. No additional benefits shall accrue or be deferred under Appendix A
after December 31, 2007.

			
	 	 	 
	Textron Spillover Savings Plan
	 	Appendix A
	Effective January 1, 2009
	 	Page 2

 

 

Article I—Definitions

In this Appendix, the following terms shall have the meanings set forth in this Article, unless a
contrary or different meaning is expressly provided:

	1.01	 	“Benefits Committee” means the Employee Benefits Committee of Textron.
	 
	1.02	 	“Board” means the Board of Directors of Textron.
	 
	1.03	 	“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
	 
	1.04	 	“Included Plan” means a Textron defined contribution plan specifically designated by the
Management Committee under Article IV.
	 
	1.05	 	“Key Executive” means an employee of a Textron Company who has been and continues to be
designated as a Key Executive under the Plan by Textron’s Chief Executive Officer and Chief
Human Resources Officer.
	 
	1.06	 	“Management Committee” means the Management Committee of Textron.
	 
	1.07	 	“Participant” means a Key Executive who is participating in this Plan pursuant to Article II
and, unless the context clearly indicates to the contrary, a former Participant who is
entitled to benefits under this Plan.
	 
	1.08	 	“Plan” means this Supplemental Savings Plan for Textron Key Executives, as amended and
restated from time to time.
	 
	1.09	 	“Savings Plan” means the Textron Savings Plan, as amended and restated from time to time.
	 
	1.10	 	“Statutory Limit” means any limit on benefits under, or annual additions to, qualified plans
imposed by Section 401(a)(17) or 415 of the Internal Revenue Codes of 1954 or 1986, as amended
from time to time.
	 
	1.11	 	“Supplemental Shares” means phantom shares of Textron common stock accumulated and accounted
for under this Plan for the purpose of determining the cash value of distributions and
transfers from a Participant’s supplemental savings account.
	 
	1.12	 	“Textron” means Textron Inc., a Delaware
corporation, and any successor of Textron Inc.
	 
	1.13	 	“Textron Company” means Textron or any company controlled by or under common control with
Textron.

			
	 	 	 
	Textron Spillover Savings Plan
	 	Appendix A
	Effective January 1, 2009
	 	Page 3

 

 

Article II—Participation

	2.01	 	A Key Executive shall participate in this Plan if the annual additions to her accounts under
the Savings Plan or any Included Plan are limited by one or more Statutory Limits.

Article III—Supplemental Savings Benefits

	3.01	 	Textron shall maintain a supplemental savings account and a fixed income account for each
Participant who participates in the Savings Plan for making credits, payments, and transfers
described in this Article.
	 
	3.02	 	A Participant who contributes at least 10% of eligible compensation to the Textron Savings
Plan each month shall receive a supplemental savings credit. Textron shall, as of the end of
each calendar month, credit Supplemental Shares to each supplemental savings account, equal to
the lost employer contribution for the month divided by the average of the composite closing
prices of Textron common stock, as reported in The Wall Street Journal for the month. The
lost employer contribution for the month shall be equal to the Participant’s Savings Plan
eligible compensation for the month times the Participant’s Savings Plan election percentage
(not to exceed 10%) times 50%, less the employer contribution made to the Participant’s
Savings Plan Account for the month.
	 
	3.03	 	Textron shall, in each calendar quarter, credit Supplemental Shares to a Participant’s
supplemental savings account equal in number to the number of shares of Textron common stock
that would have been allocated on account of dividends to the Participant’s supplemental
savings account as of that date, based on the average of the composite closing prices of
Textron common stock, as reported in The Wall Street Journal for the month in which the date
of record occurs.
	 
	3.04	 	Amounts in the fixed income account shall earn interest at a monthly interest rate that is
one twelfth of the average for the calendar month of the Moody’s Corporate Bond Yield Index as
published by Moody’s Investors Service, Inc. (or any successor thereto), or, if such monthly
yield is no longer published, a substantially similar average selected by the Benefits
Committee. Interest shall be credited on the last day of each calendar month on the average
daily balance of the fixed income account during the month.
	 
	3.05	 	A Participant who has terminated her Textron employment may, once each calendar month, elect
to transfer, in 5% increments (with a minimum transfer of 10% of the supplemental savings
account), effective the first calendar day of the month following the minimum notice of three
business days, any amount in her supplemental savings account to her fixed income account.
The cash value transferred will be determined by
multiplying the current value of Textron common stock by the number of whole and fractional
Supplemental Shares in her supplemental savings account as of the end of the month in which
the election is made times the percentage being transferred. If any

			
	 	 	 
	Textron Spillover Savings Plan
	 	Appendix A
	Effective January 1, 2009
	 	Page 4

 

 

	 	 	portion of a
Participant’s accounts under the Savings Plan shall be forfeited, a proportionate part of
the Participant’s Supplemental Shares also shall be forfeited. The current value of a share
of Textron common stock at the transfer date shall be the average of the composite closing
prices, as reported in The Wall Street Journal, for the first ten trading days of the
effective month.
	 
	3.06	 	The number of Supplemental Shares credited to a Participant’s account under this Article III
shall be adjusted, without receipt of any consideration by Textron, on account of any stock
split, stock dividend, or similar increase or decrease affecting Textron common stock, as if
the Supplemental Shares were actual shares of Textron common stock.

Article IV—Supplemental Included Plan Benefits

	4.01	 	The Management Committee may cause this Plan to provide supplemental benefits on account of
an Included Plan by adopting a Schedule to this Plan. The Schedule shall specify any special
terms or conditions upon which the supplemental benefits shall be provided. Except as
specifically provided in a Schedule, all of the terms and conditions of this Plan shall apply
to the Included Plan.

Article V—Unfunded Plan

	5.01	 	Benefits to be provided under this Plan are unfunded obligations of Textron. Nothing
contained in this Plan shall require Textron to segregate any monies from its general funds,
to create any trust, to make any special deposits, or to purchase any policies of insurance
with respect to such obligations. If Textron elects to purchase individual policies of
insurance on one or more of the Participants to help finance its obligations under this Plan,
such individual policies and the proceeds therefrom shall at all times remain the sole
property of Textron and neither the Participants whose lives are insured nor their
beneficiaries shall have any ownership rights in such policies of insurance.
	 
	5.02	 	This Plan is intended in part to provide benefits for a select group of management employees
who are highly compensated, within the meaning of Sections 201(2), 301(a)(3), and 401(a)(1) of
the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and in part to be
an excess benefit plan, pursuant to Section 3(36) of ERISA.
	 
	5.03	 	No Participant shall be required or permitted to make contributions to this Plan.

Article VI—Plan Administration

	6.01	 	Textron shall be the plan administrator of this Plan and shall be solely responsible for its
general administration and interpretation. Textron shall have all such powers as may be
necessary to carry out the provisions hereof. Textron may from time to time establish rules
for the administration of this Plan and the transaction of its business. Subject to

			
	 	 	 
	Textron Spillover Savings Plan
	 	Appendix A
	Effective January 1, 2009
	 	Page 5

 

 

	 	 	Section
6.05, any action by Textron shall be final, conclusive, and binding on each Participant and
all persons claiming by, through or under any Participant. Textron (and any person or persons
to whom it delegates any of its authority as plan administrator) shall have discretionary
authority to determine eligibility for Plan benefits, to construe the terms of the Plan, and
to determine all questions arising in the administration of the Plan, and shall make all such
determinations and interpretations in a nondiscriminatory manner.
	 
	6.02	 	(a) Except as provided in the following sentence, and in subsections (b), (c), and (d),
below, the distribution of any account under Article III or Article IV shall be made at the
same time, in the same manner, to the same persons and in the same proportions, as is made the
payment or distribution under the related Savings Plan or Included Plan, or otherwise as
determined by the Benefits Committee in its sole discretion. However, if a Participant’s
supplemental savings account contains 50 or fewer Supplemental Shares at termination, such
Participant’s supplemental savings account shall be paid in a single sum. Textron may
withhold from benefits and accounts under this Plan, any taxes or other amounts required by
law to be withheld. Notwithstanding any provision to the contrary, no benefit shall be paid to
any Participant while employed by Textron.

(b) Each amount then credited to the accounts under Article III and Article IV shall
become due and payable to the respective Participants and beneficiaries immediately upon a
Change in Control as defined in Section 7.03.

(c) Effective for payments commencing on or after January 1, 2008, the Benefits Committee
has exercised its discretion pursuant to subsection (a) to determine that all distributions
shall be made or shall commence at the time of a Participant’s termination of employment (or
in January 2009, if the Participant’s employment terminated before December 31, 2007) in one
of the following forms of payment:

(i) A cash lump sum.

(ii) Annual installments in cash over a period not exceeding 15 years (or the
Participant’s life expectancy, if less), calculated each year by dividing the
Participant’s unpaid account balance as of January 1 of that year by the remaining
number of unpaid installments. If a Participant dies while receiving installment
payments, the remaining installments will be paid in a lump sum to the Participant’s
designated beneficiary.

A Participant who wishes to request a form of payment must file an election in a form
acceptable to Textron, before the election deadline described below, to indicate her
preferred form of payment; but all Participant elections shall be subject to the Benefits
Committee’s discretion to change the elected form of payment. If a Participant’s
supplemental savings account contains 50 or fewer Supplemental Shares at termination,

			
	 	 	 
	Textron Spillover Savings Plan
	 	Appendix A
	Effective January 1, 2009
	 	Page 6

 

 

the
Participant’s supplemental savings account shall be paid in a cash lump sum at the
Participant’s termination of employment. If a Participant who is still employed by a
Textron Company fails to request a form of payment before the end of 2008, such
Participant’s account shall be paid in a lump sum in cash six months after the Participant’s
termination of employment. If a Participant’s employment with all Textron Companies has
terminated before December 31, 2007, and if the Participant fails to request a form of
payment before the end of 2008, such Participant’s account shall be paid in a lump sum in
cash in January 2009.

(d) Effective January 1, 2008, any payment to a beneficiary shall be made in a lump sum in
the month following the Participant’s death (or in January 2008, if later). If a
beneficiary is receiving installment payments as of December 31, 2007, any remaining
installments due after 2007 shall be aggregated and paid in a lump sum in January 2008.

	6.03	 	Textron may employ or engage such agents, accountants, actuaries, counsel, other experts and
other persons as it deems necessary or desirable in connection with the interpretation and
administration of this Plan. Textron shall be entitled to rely upon all certifications made by
an accountant selected by Textron. Textron and its committees, officers, directors and
employees shall not be liable for any action taken, suffered or omitted by them in good faith
in reliance upon the advice or opinion of any such agent, accountant, actuary, counsel or
other expert. All action so taken, suffered or omitted shall be conclusive upon each of them
and upon all other persons interested in this Plan.
	 
	6.04	 	Textron may require proof of death or total disability of any Participant, former Participant
or beneficiary and evidence of the right of any person to receive any Plan benefit.
	 
	6.05	 	Claims under this Plan shall be filed in writing with Textron, and shall be reviewed and
resolved pursuant to the claims procedure in Section 7.05 of the Textron Spillover Savings
Plan.

Article VII—Miscellaneous

	7.01	 	Unless a contrary or different meaning is expressly provided, each
use in this Plan of the masculine or feminine gender shall include the other
and each use of the singular number shall include the plural.
	 
	7.02	 	(a) Textron shall recognize the right of an
alternate payee named in a domestic
relations order to receive all or a portion
of a Participant’s benefit under the Plan,
provided that (1) the domestic relations
order would be a “qualified domestic
relations order” within the meaning of IRC
Section 414(p) if IRC Section 414(p) were
applicable to the Plan (except that the
order may require payment to be made to the
alternate payee before the Participant’s
earliest retirement age), (2) the domestic
relations order does not

			
	 	 	 
	Textron Spillover Savings Plan
	 	Appendix A
	Effective January 1, 2009
	 	Page 7

 

 

purport to give the
alternate payee any right to assets of any
Textron Company, (3) the domestic relations
order does not purport to allow the
alternate payee to defer payments beyond the
date when the benefits assigned to the
alternate payee would have been paid to the
Participant, and (4) the domestic relations
order does not require the Plan to make a
payment to an alternate payee in any form
other than a cash lump sum.

(b) Except as provided in subsection (a) concerning domestic relations orders, no amount
payable at any time under this Plan shall be subject in any manner to alienation, sale,
transfer, assignment, pledge or encumbrance of any kind to the extent that the assignment
or other action would cause the amount to be included in the Participant’s gross income or
treated as a distribution for federal income tax purposes. A Participant may, with the
written approval of the Benefits Committee, make an assignment of a benefit for estate
planning or similar purposes if the assignment does not cause the amount to be included in
the Participant’s gross income or treated as a distribution for federal income tax
purposes. Any attempt to alienate, sell, transfer, assign, pledge or otherwise encumber
any such benefit, whether presently or subsequently payable, shall be void unless so
approved. Except as required by law, no benefit payable under this Plan shall in any
manner be subject to garnishment, attachment, execution or other legal process, or be
liable for or subject to the debts or liability of any Participant or beneficiary.

	7.03	 	Notwithstanding any Plan provision to the contrary, the Board or its designee shall have the
right to amend, modify, suspend or terminate this Plan at any time by written ratification of
such action; provided, however, that no amendment, modification, suspension or termination:

	 	(1)	 	shall reduce an amount credited to any supplemental account under Article III
or Article IV of this Plan immediately before the effective date of the amendment,
modification, suspension or termination; or
	 
	 	(2)	 	shall be made to Section 6.02 or 7.03 following a Change in Control.

If after a Change in Control any claim is made or any litigation is brought by a Participant or
beneficiary to enforce or interpret any provision contained in this Plan,
Textron and the “person” or “group” described in the next following sentence shall be liable, jointly and severally, to indemnify
the Participant or beneficiary and to pay prejudgment interest on any recovery as provided in Section 7.06 of the Textron Spillover
Savings Plan.

For purposes of this Plan, a “Change in Control” shall occur if (i) any “person” or “group” (within the
meaning of Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Act”))
other than Textron, any trustee or other fiduciary holding Textron common stock under an employee benefit
plan of Textron or a related

			
	 	 	 
	Textron Spillover Savings Plan
	 	Appendix A
	Effective January 1, 2009
	 	Page 8

 

 

company, or any corporation which is owned, directly or indirectly, by the
stockholders of Textron in substantially the same proportions as their ownership of Textron common stock,
is or becomes (other than by acquisition from Textron or a related company) the “beneficial owner” (as
defined in Rule 13d-3 under the Act) of more than 30% of the then outstanding voting stock of Textron, or
(ii) during any period of two consecutive years, individuals who at the beginning of such period
constitute the Board (and any new director whose election by the Board or whose nomination for election by
Textron’s stockholders was approved by a vote of at least two thirds of the directors then still in office
who either were directors at the beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority thereof, or (iii) stockholders of
Textron approve a merger or consolidation of Textron with any other corporation, other than a merger or
consolidation which would result in the voting securities of Textron outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted into voting securities of
the surviving entity) more than 50% of the combined voting power of the voting securities of Textron or
such surviving entity outstanding immediately after such merger or consolidation, or (iv) the stockholders
of Textron approve a plan of complete liquidation of Textron or an agreement for the sale or disposition
by Textron of all or substantially all of Textron’s assets.

	7.04	 	This Plan shall be construed in accordance with the laws of the State of Delaware.
	 
	7.05	 	Nothing contained in this Plan shall be construed as a contract of employment between any
Participant and any Textron Company, or to suggest or create a right in any Participant to be
continued in employment as a Key Executive or other employee of any Textron Company.
	 
	7.06	 	Textron, the Chief Executive Officer and the Chief Human Resources Officer, and the Benefits
Committee may impose such other lawful terms and conditions on participation in this Plan as
deemed desirable. The Chief Executive Officer, the Chief Human Resources Officer and members
of the Benefits Committee may participate in this Plan.

			
	 	 	 
	Textron Spillover Savings Plan
	 	Appendix A
	Effective January 1, 2009
	 	Page 9

 

 

 

TEXTRON SPILLOVER SAVINGS PLAN

 

APPENDIX A

 

Market Square Profit Sharing Plan Schedule

(As in effect before January 1, 2008)

 

 

 

Textron Spillover Savings Plan

Appendix A — Key Executive Plan

Market Square Profit Sharing Plan Schedule

               This Schedule to the Supplemental Benefits Plan for Textron Key Executives (the “Key Executive
Plan”) was restated effective January 1, 2000, pursuant to Article IV of the Key Executive Plan.
The Schedule is included herein as part of Appendix A to the Textron Spillover Savings Plan.
Appendix A sets forth the defined contribution provisions of the Key Executive Plan as in effect on
October 3, 2004.

	1.01	 	“Market Square Plan” means The Market Square Profit Sharing Plan, as amended and restated
from time to time.
	 
	1.02	 	Textron shall maintain a stock unit account and a fixed income account for each participant
for making credits, payments, and transfers described in this Schedule.
	 
	1.03	 	Textron shall, in each calendar quarter, credit Supplemental Shares to a Participant’s stock
unit account equal in number to the number of shares of Textron common stock that would have
been allocated on account of dividends to the Participant’s stock unit account as of that
date, based on the average of the composite closing prices of Textron common stock, as
reported in The Wall Street Journal for the month in which the date of record occurs.
	 
	1.04	 	Amounts in the fixed income account shall earn interest at a monthly interest rate that is
the average for the calendar month of the Moody’s Corporate Bond Yield Index as published by
Moody’s Investors Service, Inc. (or any successor thereto), or, if such monthly yield is no
longer published, a substantially similar average selected by the Benefits Committee.
Interest shall be credited on the last day of each calendar month on the average daily balance
of the fixed income account during the month.
	 
	1.05	 	A Participant who has terminated her Textron employment may, once each calendar month, elect
to transfer, in 5% increments (with a minimum transfer of 10% of the stock unit account),
effective the first calendar day of the month following the minimum notice of three business
days, any amount in her stock unit account to her general fund account. The cash value
transferred will be determined by multiplying the current value of Textron common stock by the
number of whole and fractional Supplemental Shares in her stock unit account as of the end of
the month in which the election is made times the percentage being transferred. The current
value of a share of Textron common stock at the transfer date shall be the average of the
composite closing prices, as reported in The Wall Street Journal, for the first ten trading
days of the effective month.
	 
	1.06	 	The number of Supplemental Shares credited to a Participant’s account under this schedule
shall be adjusted, without receipt of any consideration by Textron, on account of any stock
split, stock dividend, or similar increase or decrease

			
	 
	Textron Spillover Savings Plan 

Effective January 1, 2009
	 	Appendix A (Market Square Schedule)

Page 1

 

 

affecting Textron common stock, as if the Supplemental Shares were actually shares of
Textron common stock.

	1.07	 	Subject to Section 1.08, below, benefits shall become payable upon the Participant’s
termination of Textron employment or such other time as determined by the Benefits Committee
in its sole discretion. Textron, upon the written instructions of the Benefits Committee or
its designee, shall distribute the benefits in accordance with any one or a combination of the
following methods after considering any method of payment requested by the Participant or by
the beneficiaries entitled to receive the benefits:

     (1) Payment in a single sum.

     (2) Payment in a number of annual installments, each payable as soon as practicable
after the end of each successive calendar year, over a period not exceeding the life
expectancy of the payee or his primary beneficiary (whichever is greater) determined as of
the date on which the benefits first became payable. The annual installments shall be
calculated each year by dividing the unpaid amount of the benefits as of January 1 of that
year by the remaining number of unpaid installments. Plan benefits payable under Section
1.07 shall begin to be paid not later than April 1 of the calendar year that begins after
the date the Participant attains or would have attained age 701/2.

	1.08	 	Effective for payments commencing on or after January 1, 2008, the Benefits Committee has
exercised its discretion pursuant to Section 1.07 to determine that all distributions shall be
made or shall commence at the time of a Participant’s termination of employment (or in January
2009, if later) in one of the following forms of payment:

(i) A cash lump sum.

(ii) Annual installments in cash over a period not exceeding 15 years (or the
Participant’s life expectancy, if less), calculated each year by dividing the
Participant’s unpaid account balance as of January 1 of that year by the remaining
number of unpaid installments. If a Participant dies while receiving installment
payments, the remaining installments will be paid in a lump sum to the
Participant’s designated beneficiary.

A Participant who wishes to request a form of payment must file an election in a form
acceptable to Textron, before the election deadline described below, to indicate her
preferred form of payment; but all Participant elections shall be subject to the Benefits
Committee’s discretion to change the elected form of payment. If a Participant who is
still employed by a Textron Company fails to request a form of payment before the end of
2008, such Participant’s account shall be paid in a lump sum in cash six months after the
Participant’s termination of employment. If a Participant’s employment with all Textron
Companies has

			
	 
	Textron Spillover Savings Plan 

Effective January 1, 2009
	 	Appendix A (Market Square Schedule)

Page 2

 

 

terminated before December 31, 2008, and if the Participant fails to request a form of
payment before the end of 2008, such Participant’s account shall be paid in a lump sum in
cash in January 2009.

Effective January 1, 2008, any payment to a beneficiary shall be made in a lump sum in the
month following the Participant’s death (or in January 2008, if later). If a beneficiary
is receiving installment payments as of December 31, 2007, any remaining installments due
after 2007 shall be aggregated and paid in a lump sum in January 2008.

			
	 
	Textron Spillover Savings Plan 

Effective January 1, 2009
	 	Appendix A (Market Square Schedule)

Page 3

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00153-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00153-of-00352.parquet"}]]