___________________________________________________ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Form 10-K [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 30,1995 Commission File Number 1-5480 Textron Inc. (Exact name of registrant as specified in charter) Delaware 05-0315468 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 40 Westminster Street, Providence, R.I. 02903 (401) 421-2800 (Address and telephone number of principal executive offices) ______________ Securities registered pursuant to Section 12(b) of the Act: Title of Class Name of Each Exchange on Which Registered Common Stock - par value $0.125; (85,978,117 shares outstanding at New York Stock Exchange March 1, 1996) Pacific Stock Exchange Preferred Stock Purchase Rights Chicago Stock Exchange $2.08 Cumulative Convertible New York Stock Exchange Preferred Stock, Series A- no par value $1.40 Convertible Preferred Dividend Stock, Series B (preferred only as to dividends) - no par value New York Stock Exchange 9.25% Debentures due March 15, 2016 New York Stock Exchange 8.75% Debentures due July 1, 2022 7.92% Trust Preferred Securities of New York Stock Exchange Subsidiary Trust (and Textron Guaranty with respect thereto) Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes X . No . Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ] The aggregate market value of voting stock held by non-affiliates of the registrant is $6,886,686,124 as of March 1, 1996. Portions of Textron's Annual Report to Shareholders for the fiscal year ended December 30, 1995 are incorporated by reference in Parts I and II of this Report. Portions of Textron's Proxy Statement for its Annual Meeting of Shareholders to be held on April 24, 1996 are incorporated by reference in Part III of this Report. __________________________________________________ <page2> PART I ITEM 1. BUSINESS OF TEXTRON* Textron is a global multi-industry company with operations in six business segments - Aircraft, Automotive, Industrial, Systems and Components, Finance and Paul Revere. A listing of the Divisions within each business segment, including a description of the product lines of each Division, is incorporated herein by reference to pages 53 through 55 of Textron's 1995 Annual Report to Shareholders. Financial information by business segment and geographic area is incorporated herein by reference to pages 22 and 49 of Textron's 1995 Annual Report to Shareholders. Additional information regarding each business segment and Textron in general is set forth below. Business Segments Aircraft. The Aircraft segment consists of Bell Helicopter and The Cessna Aircraft Company. Based on unit sales, Bell Helicopter is the largest supplier of helicopters, spare parts and helicopter-related services in the world. Since it was founded in 1946, Bell has delivered over 33,000 aircraft to military and civilian customers in over 120 countries. Bell has four military and seven civilian helicopter models in current production. Its aircraft are turbine powered, and range in size from the five place Bell Model 206 series to the Bell Model 412P aircraft, which carries up to fifteen people. Bell's military business includes both U.S. Government and non-U.S. Government customers. There are more helicopters in field service in the inventory of the U.S. Government manufactured by Bell than by any other helicopter company. Currently, Bell is supplying advanced military helicopters, spare parts and product support to the U.S. and Canadian Governments and to the governments of several countries in the Pacific Rim, Middle East and Europe. Military sales to non-U.S. customers are made only with the concurrence of the U.S. Government. Bell is also a leading supplier of commercially-certified helicopters, with a market share of approximately 50% of current deliveries to charter, offshore, utility, police, fire, rescue and emergency medical helicopter operators. Bell's non-U.S. Government business (including non-U.S. military customers) typically represents 40% to 60% of its annual sales. In 1995, such sales accounted for 48% of Bell's business. ____________________ * Reference herein to "Textron" includes Textron Inc., its divisions and subsidiaries. A Textron "Division" is an operating unit which may be comprised of an unincorporated division of Textron, a subsidiary of Textron, or an unincorporated division of a subsidiary.
3 Bell is teamed with the Helicopter Division of the Boeing Company in the development of the V-22 Osprey tiltrotor aircraft for the U.S. Department of Defense. Tiltrotor aircraft are designed to utilize the benefits of both helicopters and fixed- wing aircraft. Production of V-22 aircraft is expected to begin in late 1996 or early 1997. In addition, Bell is developing an unmanned tiltrotor under contract with the Department of Defense. Bell will introduce two new civilian helicopter models in 1996: the single-engine Bell Model 407 (a light helicopter), and the twin-engine intermediate size Bell Model 430. Other commercial products and product improvements continue to be developed. In the light and medium helicopter market, Bell Helicopter has two major U.S. competitors and one major European competitor. Certain of its competitors are substantially larger and more diversified aircraft manufacturers. Bell Helicopter markets its products worldwide through its own sales force as well as through independent representatives. Price, financing terms, aircraft performance, reliability and product support are significant factors in the sale of helicopters. Bell has developed the world's largest distribution system to sell and support helicopters, serving customers in over 120 countries. Revenues of Bell Helicopter accounted for approximately 16%, 14% and 13% of Textron's total revenues in 1995, 1994 and 1993, respectively. The Cessna Aircraft Company is, based on unit sales, the world's largest manufacturer of light and mid-size business jets and single-engine utility turboprop aircraft. Cessna designs, manufactures and sells general aviation aircraft, aircraft propellers and related accessories worldwide. Based on units shipped by manufacturers, Cessna's 1995 share of all manufacturers' worldwide sales of light and midsize jets was 52%. Cessna currently has two major product lines, Citation business jets and single-engine turboprop Caravans. In addition, Cessna has commenced construction of a manufacturing facility for single-engine piston aircraft production in Independence, Kansas. The Independence facility is scheduled to begin production in late 1996 and will produce Cessna Model 172, 182 and 206 aircraft, orders for which are currently being taken. The Cessna Caravan is the world's best selling utility turboprop. The delivery of the 750th Caravan will occur in 1996. Caravan deliveries have averaged over 60 aircraft per year since the Caravan's introduction in 1982. Caravans are used in the United States primarily to carry overnight express package shipments. International uses of Caravans include commuter airlines, relief flights, tourism and freight. Cessna currently produces a family of Citation business jets ranging from the Citation Jet to the Citation X. The Citation X is the world's fastest business jet with a maximum operating speed of Mach .92. Full certification of the Citation X is expected in April 1996, with deliveries expected to commence in June 1996. In addition, deliveries of the new Citation Bravo and Citation Excel business jets will commence in 1997 and 1998, respectively.
4 Cessna markets its products worldwide primarily through its own sales force as well as through a network of authorized independent sales representatives. Cessna has five major competitors for its business jet products, two U.S. and three foreign. Cessna's aircraft compete with other aircraft that vary in size, speed, range, capacity, handling characteristics and price. Reliability and product support are significant factors in the sale of these aircraft. Cessna provides its business jet operators with factory-direct customer support offering 24 hour a day service and maintenance. More than 40% of the worldwide Citation fleet of 2,300 aircraft receive service through Cessna- owned service centers. Cessna Caravan customers receive product support through independently owned service stations and 24 hour spare parts support through Cessna. Automotive. The Automotive segment, organized under an umbrella organization called Textron Automotive Company ("TAC"), consists of the Textron Automotive Trim Operations, CWC Castings, McCord Winn, Micromatic and Randall. These operations sell primarily to automotive original equipment manufacturers and their suppliers ("OEMs") operating in North America and, to a lesser extent, in Europe. Through its Textron Automotive Trim Operations, TAC is a leading worldwide supplier of automotive interior and exterior plastic components. Products include totally integrated interior systems, including instrument panels, door and sidewall trim, airbag doors, console assemblies, trim components, package trays, armrests and headliner systems. In addition, TAC's trim facilities manufacture painted fascias, body side moldings and claddings, fender liners, lighting assemblies and structural composite bumper beams. Revenues of the Textron Automotive Trim Operations accounted for 13%, 13% and 10% of Textron's total revenues in 1995, 1994 and 1993, respectively. TAC's other operations manufacture and sell a broad variety of functional components. CWC Castings designs and manufactures engine camshafts, balance shafts and vibration damper components. McCord Winn manufactures seating comfort systems, windshield washer systems and precision DC motors. Micromatic manufactures machine tools used in the production of automobile engines for precision bore and surface finishing, spline and gear production. Randall produces fuel filler systems, tubular seat frames, metal wheel covers and hub caps. TAC is headquartered in Troy, Michigan and has over 30 facilities located in the United States, Canada, Mexico and the United Kingdom. TAC's newly opened plant in Saltillo, Mexico, provides components for the Dodge Ram pick-up truck. TAC also has a 50% interest in a joint venture in the Netherlands for the manufacture of instrument panels. In 1995, TAC supplied on average approximately $116 in components for every car and light truck built in North America.
5 More than 70 models currently carry parts made by TAC, including Chrysler's Jeep Grand Cherokee and Voyager and Caravan mini-vans, Ford's Lincoln Town Car and Windstar and Aerostar mini-vans, and GM's Cadillac Seville, Cutlass Supreme and Pontiac Transport minivan. TAC supplies almost $800 of components in every Chrysler LH series car. TAC's manufacturing operations are supported by a staff of research and design specialists at TAC's Automotive Technology Center. These specialists have developed new processes and products, many of which are patented, that allow TAC to offer its customers technology driven products and processes. In the plastics and coatings area, TAC is a recognized leader in alternative skin materials (including non-PVC materials), spray urethane and cloth integration, energy management foam (including impact and knee bolsters), the development of modular integrated assemblies and vertical body panels, and High Crystalline Polypropylene material for complete mold-in-color interior components. CWC Castings is a leader in the design and manufacture of automotive castings. It has developed a selective austempering heat treatment process for ductile camshafts as well as a vacuum casting system for hollow steel camshafts. McCord Winn is working with OEMs worldwide to develop advanced technologies in areas such as "intelligent" comfort seating systems, brushless motors and carbon commutation for flexible fuel applications. Micromatic machine tools are recognized throughout the world for their cylindrical form generation and surface finishing capabilities. In the automotive business, there is often a long lead time from the time a supplier is selected to supply components on a new car model to the time the supplier can first begin shipping production parts. During this period, the supplier incurs engineering and development costs. Until recently, the OEMs reimbursed the supplier for these costs as incurred. Within the last few years, the OEMs have begun to require that these costs be recovered in the piece prices charged by the suppliers as the goods are shipped. In addition, automotive OEMs often require "just-in-time" delivery, so the manufacturer has to both plan shipments in advance and hold inventory. Automotive OEMs and their suppliers are the principal customers of TAC. The only customers, the loss of which would have a material adverse effect on TAC, are the U.S. based automotive OEMs and their first-tier suppliers. However, because of the broad range of products sold to such customers, it is unlikely that such customers would cease all purchases from TAC. Each of TAC's businesses faces competition from a number of other manufacturers, based primarily on price, quality, reputation and delivery. Although TAC is one of the largest manufacturers offering its range of products and services, it faces strong competition in all of its market segments. Because of the diversity of products and services offered, no single company is a competitor in all market segments. In certain markets, TAC also competes for business with the OEMs' own operations.
6 Industrial. The Industrial segment consists of three major product groups: Fastening Systems, Golf and Turf Care Equipment, and Diversified Products. The Fastening Systems Group consists of the Avdel, Camcar, Cherry and Elco Divisions, which manufacture and sell fasteners, fastening systems and installation tools to the aerospace, appliance, automotive, business equipment, construction, do-it- yourself, general industrial and transportation markets. Sales are made to a wide range of customers, including OEMs, distributors and consumers. Fasteners manufactured by the Group include rivets, threaded and non-threaded fasteners and cold- formed special fasteners, as well as assemblies which incorporate such products with other products, such as metal stampings and molded plastics. Elco was acquired by Textron in 1995, as was the German-based Boesner unit of Camcar. In February 1996, Textron announced that it had signed a definitive agreement to acquire Valios Industries, a French based manufacturer of engineered fastening systems, subject to European Commission approval. Although the Fastening Systems Group is one of the largest manufacturers of its products and services, there are hundreds of competitors of the Fastening Systems Group ranging from small proprietorships to multi-national companies. As is the case with all Divisions of the Industrial segment, competition is based primarily on price, quality, reputation and delivery. In addition, larger customers of fastening systems tend to procure products and services from the larger suppliers, except for "niche" products which may be sourced from smaller companies. The only customers, the loss of which would have a material adverse effect on the Fastening Systems Group, are the U.S. automotive OEMs and their first-tier suppliers. However, because of the broad range of products sold to such customers, it is unlikely that such customers will cease all purchases from the Fastening Systems Group. The Golf and Turf Care Equipment Group consists of the E-Z-GO Division, which manufactures and sells electric powered and gasoline powered golf cars and multipurpose utility vehicles, and the Jacobsen Division, which manufactures and sells professional mowing and turf maintenance equipment. The customers of the Golf and Turf Care Equipment Group consist primarily of golf courses, resort communities and commercial and industrial users such as airports and factories. Sales are made directly through factory branches, through a network of distributors and to end-users. Many sales of golf and turf care equipment (both at the distributor and end-user level) are financed through Textron Financial Corporation, both for marketing purposes and as an additional source of revenue to Textron. The Diversified Products Group consists of Divisions manufacturing a wide range of products, including double enveloping worm gear speed reducers, gear motors and gear sets (Cone Drive); powered equipment, electrical test instruments and hand tools (Greenlee); and watch attachments and fashion jewelry (Speidel). Products of the Diversified Products Group are sold to a wide variety of customers, including OEMs, distributors and end- users.
7 Systems and Components. The Systems and Components segment consists of seven Divisions which serve both commercial and military customers, primarily in aerospace markets, with an extensive offering of systems, subsystems, components, materials and services. Fuel Systems designs, manufactures and overhauls gas turbine engine injection and metering devices, fuel distribution valves, and augmentor fuel injection systems for commercial and military aircraft, and industrial, marine, and vehicular markets. OEM sales are made directly to customers, and overhaul and repair services are sold directly to domestic customers and through a distributor for international customers. Fuel Systems invests in the design and development of innovative, proprietary products, provides on-site engineering support at customer facilities, and maintains a state-of-the-art development laboratory to extend customers' own design activities. HR Textron ("HRT") designs and manufactures control systems and components for aircraft, armored vehicles and commercial applications. HRT markets its aerospace and defense products directly to the U.S. Government and OEMs and, in the aftermarket, both directly and through service centers. HRT has launched an initiative to diversify its business base by adapting aerospace technology to servovalves used in commercial and industrial applications, including timber milling, molding machinery, test equipment, and animated figures in entertainment theme parks. In addition, HRT is working with several automotive manufacturers to develop fast acting precision control products for active suspension, power steering, and braking systems. Textron Aerostructures designs and manufactures structural assemblies for aircraft and space vehicles. The principal products of Textron Aerostructures, which are marketed directly to its customers, are wing components for the Airbus 330/340 aircraft, the empennage for the C130 military transport, the empennage for the Bell/Boeing V-22 Osprey, the wings for the Gulfstream GIV executive jet, and the nose cones and aft skirts for the Titan IV booster. Textron Lycoming is the world leader in the design, manufacture and overhaul of reciprocating piston aircraft engines serving the worldwide general aviation market, with a worldwide market share of 80 percent of units sold. Textron Lycoming sells new products directly to general aviation airframe manufacturers, including Piper Aircraft, Robinson Helicopter and SOCATA, a division of Aerospatiale, and will build the engines for Cessna's new product line of single engine aircraft. Aftermarket sales are made to the more than 180,000 existing owners of Textron Lycoming products through a worldwide network of independently owned distributors. Textron Marine & Land Systems ("TM&LS") is a world leader in the design and construction of advanced marine craft, including air cushion vehicles, surface effect ships and rugged monohulls. TM&LS's products also include light armored combat vehicles, turrets, gun systems and advanced suspension systems. TM&LS's products are in use in 35 countries by both military and commercial customers. TM&LS's products are marketed directly in the United States and through sales representatives and distributors internationally. TM&LS has been awarded a production contract from the U.S. Coast Guard for its 47' Motor Lifeboat and a contract from the U.S. Army for the design and production of its Armored Security Vehicle.
8 Textron Systems designs and manufactures products in three primary areas: sensor fuzed munitions, surveillance systems and aircraft landing systems. The focus of Textron Systems is on real-time control systems _ products that sense their environment, analyze and process data, make a decision, and take action in real time. Sales are made primarily to the U. S. Department of Defense, but Textron Systems also is applying its technologies to several commercial products, including aircraft landing systems and opto-electronic sensors. In February, 1996, Textron Systems become responsible for the operations of the former Textron Specialty Materials Division, which develops and manufactures high strength, lightweight, advanced composite materials for aircraft, automotive, industrial and sporting goods manufacturers, and fire protection materials for oil and chemical companies worldwide. Textron Systems generally sells its products directly to its customers, but Specialty Materials products are also sold through sales representatives and a small proportion of international sales are made through sales representatives and distributors. Turbine Engine Components is one of the world's largest independent suppliers of internal components for gas turbine engines for aircraft and industrial applications. Its products include fan and compressor blades, vanes, shafts, disks, rotors, blisks and other rotating components; the forgings from which those products are machined; and stationary components of turbine engines, such as frames, diffusers, and air collectors. Turbine Engine Components manufactures its products to the specifications of its customers, and most of its sales are made directly to its customers. The principal competitive factors affecting sales of the products of the Systems and Components segment are price, quality, customer service, performance, reliability, reputation and existing product base. In the case of programs requiring a large investment in inventory and tooling, such as those of Textron Aerostructures, competitive factors also include a willingness to invest in the customer's program. Finance. The Finance segment consists of Avco Financial Services ("AFS") and Textron Financial Corporation ("TFC"). AFS is primarily engaged in consumer finance and insurance activities. AFS's finance operations mainly involve loans made by the Avco Financial Services Group, consisting of consumer loans which are unsecured or secured by personal property, real estate loans secured by real property, and retail installment contracts, principally covering personal property. AFS's insurance business consists primarily of the sale of credit life, credit disability and casualty insurance, offered through the Avco Insurance Services Group, a significant part of which is directly related to AFS's finance activities. AFS's consumer finance and insurance activities are conducted through its nearly 1,200 finance offices located in the United States, Australia, Canada, Hong Kong, New Zealand, Spain and the United Kingdom. AFS's loan business is regulated by laws that, among other things, generally limit maximum charges for loans and the maximum amount and term thereof. Such laws also require disclosure to customers of the interest rate and other basic terms of most credit transactions and give customers a limited right to cancel certain loans and retail
9 installment contracts without penalty. In addition, in certain jurisdictions, its retail installment business is subject to regulations that, among other things, limit the rates which may be charged and require that certain disclosures be made to customers. The insurance business is subject to licensing and regulation by state authorities. The consumer finance business is highly competitive, with price and service being the principal competitive factors. AFS's competitors include not only other companies operating under consumer loan laws, but also other types of lending institutions not so regulated and usually not limited in the size of their loans, such as companies which finance the sale of their own merchandise or the merchandise of others, industrial banks, the personal loan departments of commercial banks and credit unions. AFS's strongest competition is from commercial banks and credit unions. The interest rates charged by these lenders are usually lower than the rates charged by AFS. AFS's insurance businesses, to the extent not related to AFS's finance activities, compete with many other insurance companies offering similar products. In January 1995, AFS purchased the stock of Household International, Inc.'s Australian subsidiary, HFC of Australia Ltd., adding approximately $436 million to AFS's finance receivable portfolio. Revenues of AFS accounted for approximately 17%, 14% and 15% of Textron's total revenues in 1995, 1994 and 1993, respectively. TFC is a diversified commercial finance company specializing in aircraft, golf and equipment financing and revolving credit arrangements. TFC provides commercial financing for a wide range of customers, including those who purchase or lease Textron products and certain suppliers to Textron Divisions. TFC presently offers its services primarily in the United States and, to a lesser extent, in Europe and Canada, through its eight business units. Each TFC business unit has a discrete market focus and specific profit objectives and is staffed to provide responsive services to its market. TFC's activities are subject to a variety of federal and state regulations. The businesses in which TFC operates are highly competitive. TFC is subject to competition from various types of financing institutions, including banks, investment banks, leasing companies, insurance companies, independent finance companies associated with manufacturers and public utilities, and finance companies that are subsidiaries of banking institutions. Competition within the commercial finance industry is primarily focused on price and service.
10 Finance Receivables The following table presents the Finance segment's outstanding finance receivables by country: December 31, 1995 1994 (In millions) United States $6,750 $6,627 Australia 1,026 626 Canada 1,013 942 United Kingdom 632 613 Other countries 473 276 $9,894 $9,084 At December 31, 1995, finance receivables in the United States represented 68% of Textron's total finance receivables outstanding. At such date, no receivables outstanding in any one state other than California exceeded 7% of the United States portfolio. In California, outstanding receivables represented 16% of the United States portfolio and 11% of the consolidated portfolio. Accrual of interest income is suspended for accounts which are contractually delinquent by more than three months (commercial) or three payments (consumer). Accrual of interest on commercial loans is resumed, and suspended interest income is recognized, when loans become contractually current, whereas subsequent interest income on consumer loans is recognized when collected. Nonearning consumer and commercial loans were $115 million and $99 million, respectively, at the end of 1995 and $82 million and $100 million, respectively, at the end of 1994.
11 The following table presents accruing loans on which one or more installments were more than 60 days past due (expressed as a percentage of the related gross receivables outstanding): Years ended Consumer Commercial Total December 31, loans loans loans 1995 2.89% 0.24% 2.10% 1994 2.28% - 1.59% The following table shows gross and net write-offs, the percentages which those amounts bear to average finance receivables, and the amount of the provision for losses charged to income (less recoveries): Gross write-offs Recoveries Net write-offs Percentage from Percentage Provision of average receivables of average for losses Years ended finance previously finance less December 31, Amount receivables written off Amount receivables recoveries (In millions) 1995 Consumer $177 2.6% $33 $144 2.1% $149 Commercial 25 0.9% 4 21 0.7% 19 $202 2.1% $37 $165 1.7% $168 1994 Consumer $ 142 2.5% $ 28 $ 114 2.0% $ 136 Commercial 27 1.0% 3 24 0.4% 24 $ 169 2.0% $ 31 $ 138 1.6% $ 160 1993 Consumer $ 138 2.7% $ 26 $ 112 2.1% $ 121 Commercial 20 0.8% 3 17 0.7% 21 $ 158 2.0% $ 29 $ 129 1.7% $ 142 Paul Revere. Paul Revere, which is 83% owned by Textron, is the leading provider of individual non-cancelable disability insurance in the United States and Canada. In addition to its individual disability insurance products, Paul Revere also provides group disability, life and annuity products. Paul
12 Revere's products are marketed primarily through its brokerage organization, its national accounts program and its career sales agency system. Paul Revere is subject to regulation by the states in which its insurance subsidiaries are domiciled or transact business. In addition, Paul Revere's insurance subsidiaries are subject to various regulatory restrictions on the maximum amount of dividends and other payments that they can make to Paul Revere without obtaining prior regulatory approval. Paul Revere operates in a highly competitive environment. Insurance companies compete on the basis of many factors, including financial strength, pricing and other terms and conditions of products, commission structure, perceived stability of the insurer, claims paying ratings, service, name recognition and reputation. Backlog Information regarding Textron's backlog of government and commercial orders by business segment at the end of the past two fiscal years is contained on page 29 of Textron's 1995 Annual Report to Shareholders, which page is incorporated herein by reference. Approximately 45% of Textron's total backlog at December 30, 1995, represents orders which are not expected to be filled within the 1996 fiscal year. Approximately 60% of the total backlog is funded. Government Contracts In 1995, 33% and 49% of the revenues of the Aircraft and the Systems and Components segments, respectively, constituting 13% of Textron's consolidated revenues, were generated by or resulted from contracts with the United States Government. U.S. Government business is subject to competition, changes in procurement policies and regulations, the continuing availability of Congressional appropriations, world events, and the size and timing of programs in which Textron may participate. A substantial portion of Textron's government contracts are fixed-price or fixed-price incentive contracts. Contracts that contain incentive pricing terms provide for upward or downward adjustments in the prices paid by the U.S. Government thereunder upon completion of the contract or any agreed portion thereof, based on cost or other performance factors. U.S. Government contracts generally may be terminated in whole or in part at the convenience of the U.S. Government or if the contractor is in default. Upon termination of a contract for the convenience of the U.S. Government, the contractor is normally entitled to reimbursement for allowable costs incurred (up to a maximum equal to the contract price) and an allowance for profit or adjustment for loss if the contractor would have incurred a loss had the entire contract been completed. If, however, a contract is termi nated for default: (i) the contractor is paid such amount as may be agreed upon for manufacturing materials and partially completed products accepted by the U.S. Government; (ii) the U.S. Government is not liable for the contractor's costs with respect to unaccepted items and is entitled to repayment of advance payments and progress payments, if any, related to the terminated portions of the contract; and (iii) the contractor may be liable for excess costs incurred by the U.S. Government in procuring undelivered items from another source.
13 Research and Development Information regarding Textron's research and development expenditures is contained on page 45 of Textron's 1995 Annual Report to Shareholders, which page is incorporated herein by reference. Patents and Trademarks Textron owns, or is licensed under, a number of patents and trademarks throughout the world relating to methods of manufacturing and products. Patents and trademarks have been of value in the past and are expected to be of value in the future; however, the loss of any single patent or group of patents would not, in the opinion of Textron, materially affect the conduct of its business. Environmental Considerations Textron's operations, like those of other companies engaged in similar businesses, are subject to numerous laws and regulations designed to protect the environment. Compliance with such laws and expenditures for environmental control facilities have not had, and are not expected to have, a material effect on capital expenditures, earnings or the competitive position of Textron. Additional information regarding environmental matters is contained on pages 29, 38 and 48 of Textron's 1995 Annual Report to Shareholders, which pages are incorporated herein by reference. Employees At December 30, 1995, Textron had approximately 57,000 employees. ITEM 2. PROPERTIES At December 30, 1995, Textron operated a total of 136 plants located throughout the United States and 9 plants outside the United States. Of the total of 145 plants, Textron owned 104 and the balance was leased. In the aggregate, the total manufacturing space was approximately 25 million square feet. In addition, Textron owns or leases offices, warehouse and other space at various locations throughout the United States and outside the United States. Textron also owns or leases such machinery and equipment as is necessary in the operation of its Divisions. Textron considers the productive capacity of the plants operated by each of its business segments to be adequate. In general, the plants and machinery are in good condition, are considered to be adequate for the uses to which they are being put, and are substantially in regular use.
14 ITEM 3. LEGAL PROCEEDINGS There are pending or threatened against Textron and its sub sidiaries lawsuits and other proceedings, some of which allege violations of federal government procurement regulations, involve environmental matters, or are or purport to be class actions. Among these suits and proceedings are some which seek compensatory, treble or punitive damages in substantial amounts; fines, penalties or restitution; or the remediation of allegedly hazardous wastes; or which under federal government procurement regulations could result in suspension or debarment of Textron or its subsidiaries from U.S. Government contracting for a period of time. On the basis of information presently available, Textron believes that any liability for these suits and proceedings, or the impact of the application of such government regulations, would not have a material effect on Textron's net income or financial condition. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS No matters were submitted to a vote of Textron's security holders during the last quarter of the period covered by this Report. EXECUTIVE OFFICERS OF THE REGISTRANT The following table sets forth certain information concerning the executive officers of Textron as of March 4, 1996. Unless otherwise indicated, the employer is Textron. Name Age Position James F. Hardymon 61 Chairman since 1993, and Chief Executive Officer since 1992; formerly President, 1989 through 1993, and Chief Operating Officer, 1989 through 1991; Director since 1989. CORPORATE OPERATING MANAGEMENT Lewis B. Campbell 49 President and Chief Operating Officer since 1994; formerly Executive Vice President and Chief Operating Officer, 1992 to 1993; Vice President of General Motors (1988 to 1992) and General Manager of its GMC Truck Division (1991 to 1992), and General Manager of its Flint Automotive Division Buick - Oldsmobile - Cadillac Group (1988 to 1991); Director since 1994. Harold K. McCard 64 Senior Vice President Operations since August 1995; formerly President of Textron Systems Division, 1985 to August 1995. Herbert L. Henkel 47 President, Textron Industrial Products since August 1995;
15 formerly Group Vice President, Textron Inc., 1993 to August 1995; President of the Greenlee Textron Division, 1987 to 1993. Derek Plummer 62 Chairman, Textron Automotive Company since April 1994; formerly Group Vice President, Textron Inc., 1986 to 1994. Terry D. Stinson 54 President, Textron Systems and Components since August 1995; formerly Group Vice President, Textron Inc., 1991 to August 1995; President of the Hamilton Standard Division of United Technologies Corporation, 1986 to 1991. CORPORATE STAFF MANAGEMENT Mary L. Howell 43 Executive Vice President, Government and International since August 1995; formerly Senior Vice President Government and International Relations 1993 to August 1995; Vice President - Government Affairs, 1985 to 1993. Wayne W. Juchatz 49 Executive Vice President and General Counsel since April 1995; formerly Executive Vice President and General Counsel of R.J. Reynolds Tobacco Company, 1994 to 1995; and Senior Vice President, General Counsel and Secretary of R.J. Reynolds Tobacco Company, 1987 to 1994. Stephen L. Key 52 Executive Vice President and Chief Financial Officer since March 1995; formerly Executive Vice President and Chief Financial Officer of ConAgra, Inc., 1992 to March 1995; Managing Partner of the New York office of Ernst & Young (formerly Arthur Young), 1988 to 1992. Richard A. McWhirter 61 Executive Vice President and Corporate Secretary since March 1995; formerly Executive Vice President and Chief Financial Officer, 1993 to March 1995; Senior Vice President and Secretary, 1991 to 1993; Senior Vice President - Insurance and Environmental Affairs, 1988 to 1991. William F. Wayland 60 Executive Vice President Administration and Chief Human Resources Officer since January 1993; formerly Executive Vice President - Human Resources, 1989 to January 1993. Richard A. Watson 51 Senior Vice President and Treasurer since October 1995; formerly Senior Vice President, Financial Services, August 1995 to October 1995; Group Vice President, 1990 to August 1995.
16 Carl D. Burtner 53 Vice President - Human Resources since September 1995; also served as Acting President of Speidel Textron, September 1995 to January 1996; formerly President of Greenlee Textron, 1993 to September 1995; Vice President Operations of Greenlee Textron, 1991 to 1993; and Vice President, Administration of Greenlee Textron, 1985 to 1991. Peter B. S. Ellis 42 Vice President Strategic Planning since March 1995; formerly Managing Director, Telecommunications Practice of Arthur D. Little, Inc., 1991 to March 1995; Vice President, Business Development of Contel Corporation, 1988 to 1991. Douglas A. Fahlbeck 50 Vice President - Mergers and Acquisitions since August 1995; formerly Executive Vice President, Chief Financial Officer and Director of Textron Financial Corporation, 1994 to August 1995; Senior Vice President and Chief Financial Officer of Textron Financial Corporation, 1985 to 1994. Arnold M. Friedman 53 Vice President and Deputy General Counsel since 1984. William B. Gauld 42 Vice President - Corporate Information Management and Chief Information Officer since August 1995; formerly Staff Vice President, Corporate Information Management and Chief Information Officer, 1994 to August 1995; Chief Information Officer of General Electric (Electrical Distribution and Control business) 1992 to 1994; Manager, Manufacturing Systems of General Electric (Appliances), 1989 to 1992. Gregory E.Hudson 49 Vice President - Taxes since 1987. William P. Janovitz 53 Vice President - Financial Reporting since October 1995; formerly Vice President and Controller, 1983 to October 1995. Mary F. Lovejoy 40 Vice President - Investor Relations since August 1995; formerly Director of Investor Relations, 1993 to August 1995; Vice President and Senior Corporate Banker of The First National Bank of Chicago, 1991 to 1993; Vice President and Senior Transaction Manager of The First National Bank of Chicago, 1989 to 1991. Frank W. McNally 56 Vice President - Employee Relations and Benefits since August 1995; formerly Staff Vice President, Employee Relations and Benefits, 1993 to August 1995, Staff Vice President Employee Relations, 1992 to 1993; Director, Employee Relations, 1991 to 1992.
17 Gero K.H. Meyersiek 49 Vice President - International since February 1996; formerly Vice President of Textron International Inc., February 1995 to February 1996; Vice President, International Business Development of GE Financial Services, 1991 to 1994; Managing Director, European Business Development of GE Financial Services, 1988 to 1991. Daniel L. Shaffer 59 Vice President Audit and Business Ethics since November 1994; formerly President of Textron's Aircraft Engine Components Division, 1992 to November 1994; Vice President Finance of the Textron Systems Division, 1984 to 1992. Richard F. Smith 57 Vice President - Government Affairs since August 1995; Staff Vice President - Government Affairs, March 1995 to August 1995; Director - Government Affairs, 1985 to March 1995. Richard L. Yates 45 Vice President and Controller since November 1995; formerly Executive Vice President, Chief Financial Officer and Treasurer of Paul Revere, 1994 to November 1995; Senior Vice President, Chief Financial Officer and Treasurer of Paul Revere, 1991 to 1994. John F. Zugschwert 62 Vice President - Government Marketing since August 1995; Staff Vice President, Washington Operations 1993 to August 1995; Vice President, Washington Operations of Bell Helicopter Textron, 1991 to 1993. No family relationship exists between any of the individuals named above. PART II ITEM 5. MARKETS FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS Textron's common stock is traded on the New York, Chicago and Pacific Stock Exchanges. Additional information regarding "Markets for the Registrant's Common Equity and Related Stockholder Matters" is contained on pages 51 and 52 and on the inside back cover of Textron's 1995 Annual Report to Shareholders, which pages are incorporated herein by reference.
18 ITEM 6. SELECTED FINANCIAL DATA Information regarding "Selected Financial Data" is contained in the Five Year Summary on page 52 of Textron's 1995 Annual Report to Shareholders, which page is incorporated herein by reference. ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Management's Discussion and Analysis of Financial Condition and Results of Operations is contained on pages 23 through 29 of Textron's 1995 Annual Report to Shareholders, which pages are incorporated herein by reference. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The consolidated financial statements and the supplementary information listed in the accompanying index to financial statements and financial statement schedules are filed as part of this Report. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT Information regarding Textron's directors is contained on pages 2 through 6 and page 9 of Textron's Proxy Statement for the Annual Meeting of Shareholders to be held on April 24, 1996, which pages are incorporated herein by reference. Information regarding Textron's executive officers is included on pages 14 through 17 of Part I of this Report.
19 ITEM 11. EXECUTIVE COMPENSATION Information regarding "Executive Compensation" is contained on pages 10 through 20 of Textron's Proxy Statement for the Annual Meeting of Shareholders to be held on April 24, 1996, which pages are incorporated herein by reference. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT Information regarding "Security Ownership of Certain Beneficial Holders" and "Security Ownership of Management" is contained on pages 8 and 9 of Textron's Proxy Statement for the Annual Meeting of Shareholders to be held on April 24, 1996, which pages are incorporated herein by reference. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Information regarding certain relationships and related transactions is contained on page 19 of Textron's Proxy Statement for the Annual Meeting of Shareholders to be held on April 24, 1996, which page is incorporated herein by reference. PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K (a) Financial Statements and Schedules The consolidated financial statements, supplementary information and financial statement schedules listed in the accompanying index to financial statements and financial statement schedules are filed as part of this Report. Exhibits 3.1 Restated Certificate of Incorporation of Textron as filed March 24, 1988. Incorporated by reference to Exhibit 3.1 to Textron's Annual Report on Form 10-K for the fiscal year ended January 2, 1988. 3.2 By-Laws of Textron, restated December 10, 1992. Incorporated by reference to Exhibit 3.2 to Textron's Annual Report on Form 10-K for the fiscal year ended January 2, 1993.
20 NOTE: Exhibits 10.1 through 10.21 below are management contracts or compensatory plans, contracts or agreements. 10.1 Annual Incentive Compensation Plan For Textron Employees. 10.2 Deferred Income Plan For Textron Key Executives. 10.3 Severance Plan For Textron Key Executives. 10.4 Special Benefits for Textron Key Executives. 10.5 Supplemental Benefits Plan For Textron Key Executives with Market Square Profit Sharing Plan Schedule. 10.6 Supplemental Retirement Plan For Textron Key Executives. 10.7 Survivor Benefit Plan For Textron Key Executives. 10.8A Textron 1982 Long-Term Incentive Plan ("1982 Plan"). Incorporated by reference to Exhibit 10.5(a) to Textron's Annual Report on Form 10-K for the fiscal year ended December 31, 1988. 10.8B First Amendment to 1982 Plan. Incorporated by reference to Exhibit 10.5(b) to Textron's Annual Report on Form 10-K for the fiscal year ended January 3, 1987. 10.8C Second Amendment to 1982 Plan. Incorporated by reference to Exhibit 10.5(c) to Textron's Annual Report on Form 10-K for the fiscal year ended January 2, 1988. 10.9A Textron 1987 Long-Term Incentive Plan ("1987 Plan"). Incorporated by reference to Exhibit 10.6 to Textron's Annual Report on Form 10-K for the fiscal year ended December 30, 1989. 10.9B First Amendment to 1987 Plan. Incorporated by reference to Exhibit 10.6(b) to Textron's Annual Report on Form 10-K for the fiscal year ended December 28, 1991. 10.10A Textron 1990 Long-Term Incentive Plan ("1990 Plan"). Incorporated by reference to Exhibit 10.7 to Textron's Annual Report on Form 10-K for the fiscal year ended December 30, 1989. 10.10B First Amendment to 1990 Plan. Incorporated by reference to Exhibit 10.7(c) to Textron's Annual Report on Form 10-K for the fiscal year ended December 28, 1991. 10.10C Second Amendment to 1990 Plan. Incorporated by reference to Exhibit 10.7(c) to Textron's Annual Report on Form 10-K for the fiscal year ended January 2, 1993. 10.11 Textron 1994 Long-Term Incentive Plan. Incorporated by reference to Exhibit 10 to Textron's Quarterly Report on Form 10-Q for the fiscal quarter ended July 2, 1994. 10.12 Form of Indemnity Agreement between Textron and its directors and executive officers. Incorporated by reference to Exhibit A to Textron's Proxy Statement for its Annual Meeting of Shareholders on April 29, 1987.
21 10.13A Pension Plan for Directors as amended by a First Amendment. Incorporated by reference to Exhibit 10.14 to Textron's Annual Report on Form 10- K for the fiscal year ended December 31, 1988. 10.13B Second Amendment to Pension Plan for Directors. Incorporated by reference to Exhibit 10.16(b) to Textron's Annual Report on Form 10-K for the fiscal year ended December 29, 1990. 10.14 Deferred Income Plan for Textron Directors. Incorporated by reference to Exhibit 10.18 to Textron's Annual Report on Form 10-K for the fiscal year ended January 1, 1994. 10.15A Employment Agreement between Textron and James F. Hardymon dated November 24, 1989 ("Employment Agreement"). Incorporated by reference to Exhibit 10.9 to Textron's Annual Report on Form 10-K for the fiscal year ended December 30, 1989. 10.15B Amendment dated as of December 15, 1994 to Employment Agreement. Incorporated by reference to Exhibit 10.10B to Textron's Annual Report on Form 10-K for the fiscal year ended December 31, 1994. 10.16A Employment Agreement between Textron and Lewis B. Campbell dated September 22, 1992. Incorporated by reference to Exhibit 10.9 to Textron's Annual Report on Form 10-K for the fiscal year ended January 2, 1993. 10.16B Retention Award granted to Lewis B. Campbell on December 14, 1995. 10.17 Employment Agreement between Textron and Mary L. Howell dated May 4, 1993. Incorporated by reference to Exhibit 10.11 to Textron's Annual Report on Form 10-K for the fiscal year ended January 1, 1994. 10.18 Employment Agreement between Textron and Wayne W. Juchatz dated November 1, 1995. 10.19 Employment Agreement between Textron and Stephen L. Key dated November 1, 1995. 10.20 Employment Agreement between Textron and Richard A. McWhirter dated February 16, 1993. Incorporated by reference to Exhibit 10.11 to Textron's Annual Report on Form 10-K for the fiscal year ended January 2, 1993. 10.21 Employment Agreement between Textron and William F. Wayland dated January 1, 1989. Incorporated by reference to Exhibit 10.12 to Textron's Annual Report on Form 10-K for the fiscal year ended December 30, 1989. 10.22A Credit Agreement dated as of November 1, 1993 among Textron, the Lenders listed therein and Bankers Trust Company as Administrative Agent ("Credit Agreement"). Incorporated by reference to Exhibit 10.20A to Textron's Annual Report on Form 10-K for the fiscal year ended January 1, 1994.
22 10.22B First Amendment dated as of October 30, 1994 to Credit Agreement. Incorporated by reference to Exhibit 10.22B to Textron's Annual Report on Form 10-K for the fiscal year ended December 31, 1994. 10.22C Second Amendment to Credit Agreement dated as of July 1, 1995. Incorporated by reference to Exhibit (b) (3) to Schedule 14D-1 filed by Textron on September 19, 1995. 12.1 Computation of ratio of income to fixed charges of the Textron Parent Company Borrowing Group. 12.2 Computation of ratio of income to fixed charges of Textron Inc. including all majority-owned subsidiaries. 13 A portion (pages 22 and following) of Textron's 1995 Annual Report to Shareholders. Except for pages or items specifically incorporated by reference herein, such portion of Textron's 1995 Annual Report to Shareholders is furnished for the information of the Commission and is not filed as part of this Report. 21 Certain subsidiaries of Textron. Other subsidiaries, which considered in the aggregate do not constitute a significant subsidiary, are omitted from such list. 23 Consent of Independent Auditors. 24.1 Power of attorney. 24.2 Certified copy of a resolution of the Board of Directors of Textron. 27 Financial Data Schedule. (b) Reports on Form 8-K No reports on Form 8-K were filed during the last quarter of the period covered by this Report.
23 SIGNATURES Pursuant to the requirement of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized on this 14th day of March, 1996. TEXTRON INC. Registrant By: /s/ Michael D. Cahn Michael D. Cahn Attorney-in-fact Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below on this 14th day of March, 1996, by the following persons on behalf of the registrant and in the capacities indicated: NAME TITLE * James F. Hardymon Chairman and Chief Executive Officer, Director (principal * Lewis B. Campbell President and Chief Operating Officer, Director * H. Jesse Arnelle Director * R. Stuart Dickson Director
24 * B.F. Dolan Director * Paul E. Gagne Director * John D. Macomber Director * Barbara Scott Preiskel Director * Brian H. Rowe Director * Sam F. Segnar Director * Jean Head Sisco Director * John W. Snow Director * Martin D. Walker Director
25 * Thomas B. Wheeler Director * Stephen L. Key Executive Vice President and Chief Financial Officer (principal financial officer) * Richard L. Yates Vice President and Controller (principal accounting officer) *By: /s/ Michael D. Cahn Michael D. Cahn Attorney-in-fact
26 TEXTRON INC. INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES Item 14(a) Form Annual Report Textron Inc. 10-K to Shareholders Report of Independent Auditors 31 Consolidated Statement of Income for each of the three years in the period ended December 30, 1995 32 Consolidated Balance Sheet at December 30, 1995 and 33 December 31, 1994 Consolidated Statement of Cash Flows for each of 34 the three years in the period ended December 30, 1995 Consolidated Statement of Changes in Shareholders' 35 Equity for each of the three years in the period ended December 30, 1995 Summary of Significant Accounting Policies 36-38 Notes to Consolidated Financial Statements 38-50 Revenues and Income by Business Segment 22 Supplementary Information (Unaudited): Quarterly Financial Information 1995 and 1994 51 Financial Statement Schedules for each of the three years in the period ended December 30, 1995 I Condensed financial information of 27 registrant II Valuation and qualifying accounts 28 All other schedules are omitted because the conditions requiring the filing thereof do not exist or because the information required is included in the financial statements and notes thereto.
27 TEXTRON INC. SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT For each of the three years in the period ended December 30, 1995 Financial information of the Registrant is omitted because condensed financial information of the Textron Parent Company Borrowing Group, which includes the Registrant and all of its majority-owned subsidiaries other than its finance and insurance subsidiaries, is shown on page 30 of Textron's 1995 Annual Report to Shareholders. Management believes that the disclosure of financial information on the basis of the Textron Parent Company Borrowing Group results in a more meaningful presentation, since this group constitutes the Registrant's basic borrowing entity and the only restrictions on net assets of Textron's subsidiaries relate to its finance and insurance subsidiaries. The Registrant's investment in its finance and insurance subsidiaries is shown on page 30 of Textron's 1995 Annual Report to Shareholders under the caption "Investments in finance and insurance subsidiaries." The Textron Parent Company Borrowing Group received dividends of $126 million, $115 million and $94 million from its finance and insurance subsidiaries in 1995, 1994 and 1993, respectively. The portion of the net assets of Textron's finance and insurance subsidiaries available for cash dividends and other payments to the Textron Parent Company Borrowing Group is restricted by the terms of lending agreements and insurance statutory requirements. As of December 30, 1995, approximately $376 million of their net assets of $2.6 billion was available to be transferred to the Textron Parent Company Borrowing Group pursuant to these restrictions. For information concerning the Textron Parent Company Borrowing Group's long-term debt and restrictions contained in its debt agreements, see Note 7 to the consolidated financial statements appearing on pages 42-43 of Textron's 1995 Annual Report to Shareholders.
28 TEXTRON INC. SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS For each of the three years in the period ended December 30, 1995 (In millions) Allowance for credit losses Changes in the allowance for credit losses for the years indicated were as follows: 1995 1994 1993 Balance of the allowance for credit losses at the biginning of the year $250 $225 $212 Add - charge to income: Consumer 149 136 121 Commercial 19 24 21 168 160 142 Deduct - balances charged off: Gross charge offs: Consumer (177) (142) (138) Commercial (25) (27) (20) (202) (169) (158) Recoveries: Consumer 33 28 26 Commercial 4 3 3 37 31 29 Net charge offs (165) (138) (129) Other 17 3 - Balance of the allowance for credit losses at the end of the year $ 270 $ 250 $ 225 Balance of the allowance for credit losses at the end of the year applicable to: Consumer $ 195 $ 181 $ 155 Commercial 75 69 70 $ 270 $ 250 $ 225
28 TEXTRON INC. Index of Exhibits Annual Report on Form 10-K for the Fiscal Year Ended December 31, 1994 Exhibits Description 3.1 Restated Certificate of Incorporation of Textron as filed March 24, 1988. Incorporated by reference to Exhibit 3.1 to Textron's Annual Report on Form 10-K for the fiscal year ended January 2, 1988. 3.2 By-Laws of Textron, restated December 10, 1992. Incorporated by reference to Exhibit 3.2 to Textron's Annual Report on Form 10-K for the fiscal year ended January 2, 1993. NOTE: Exhibits 10.1 through 10.21 below are management contracts or compensatory plans, contracts or agreements. 10.1 Annual Incentive Compensation Plan For Textron Employees. 10.2 Deferred Income Plan For Textron Key Executives. 10.3 Severance Plan For Textron Key Executives. 10.4 Special Benefits for Textron Key Executives. 10.5 Supplemental Benefits Plan For Textron Key Executives with Market Square Profit Sharing Plan Schedule. 10.6 Supplemental Retirement Plan For Textron Key Executives. 10.7 Survivor Benefit Plan For Textron Key Executives. 10.8A Textron 1982 Long-Term Incentive Plan ("1982 Plan"). Incorporated by reference to Exhibit 10.5(a) to Textron's Annual Report on Form 10-K for the fiscal year ended December 31, 1988. 10.8B First Amendment to 1982 Plan. Incorporated by reference to Exhibit 10.5(b) to Textron's Annual Report on Form 10-K for the fiscal year ended January 3, 1987. 10.8C Second Amendment to 1982 Plan. Incorporated by reference to Exhibit 10.5(c) to Textron's Annual Report on Form 10-K for the fiscal year ended January 2, 1988. 10.9A Textron 1987 Long-Term Incentive Plan ("1987 Plan"). Incorporated by reference to Exhibit 10.6 to Textron's Annual Report on Form 10-K for the fiscal year ended December 30, 1989. 10.9B First Amendment to 1987 Plan. Incorporated by reference to Exhibit 10.6(b) to Textron's Annual Report on Form 10-K for the fiscal year ended December 28, 1991. 10.10A Textron 1990 Long-Term Incentive Plan ("1990 Plan"). Incorporated by reference to Exhibit 10.7 to Textron's Annual Report on Form 10-K for the fiscal year ended December 30, 1989. 10.10B First Amendment to 1990 Plan. Incorporated by reference to Exhibit 10.7(c) to Textron's Annual Report on Form 10-K for the fiscal year ended December 28, 1991. 10.10C Second Amendment to 1990 Plan. Incorporated by reference to Exhibit 10.7(c) to Textron's Annual Report on Form 10-K for the fiscal year ended January 2, 1993. 10.11 Textron 1994 Long-Term Incentive Plan. Incorporated by reference to Exhibit 10 to Textron's Quarterly Report on Form 10-Q for the fiscal quarter ended July 2, 1994. 10.12 Form of Indemnity Agreement between Textron and its directors and executive officers. Incorporated by reference to Exhibit A to Textron's Proxy Statement for its Annual Meeting of Shareholders on April 29, 1987. 10.13A Pension Plan for Directors as amended by a First Amendment. Incorporated by reference to Exhibit 10.14 to Textron's Annual Report on Form 10-K for the fiscal year ended December 31, 1988. 10.13B Second Amendment to Pension Plan for Directors. Incorporated by reference to Exhibit 10.16(b) to Textron's Annual Report on Form 10-K for the fiscal year ended December 29, 1990. 10.14 Deferred Income Plan for Textron Directors. Incorporated by reference to Exhibit 10.18 to Textron's Annual Report on Form 10-K for the fiscal year ended January 1, 1994. 10.15A Employment Agreement between Textron and James F. Hardymon dated November 24, 1989 ("Employment Agreement"). Incorporated by reference to Exhibit 10.9 to Textron's Annual Report on Form 10-K for the fiscal year ended December 30, 1989. 10.15B Amendment dated as of December 15, 1994 to Employment Agreement. Incorporated by reference to Exhibit 10.10B to Textron's Annual Report on Form 10-K for the fiscal year ended December 31, 1994. 10.16A Employment Agreement between Textron and Lewis B. Campbell dated September 22, 1992. Incorporated by reference to Exhibit 10.9 to Textron's Annual Report on Form 10-K for the fiscal year ended January 2, 1993. 10.16B Retention Award granted to Lewis B. Campbell on December 14, 1995. 10.17 Employment Agreement between Textron and Mary L. Howell dated May 4, 1993. Incorporated by reference to Exhibit 10.11 to Textron's Annual Report on Form 10-K for the fiscal year ended January 1, 1994. 10.18 Employment Agreement between Textron and Wayne W. Juchatz dated November 1, 1995. 10.19 Employment Agreement between Textron and Stephen L. Key dated November 1, 1995. 10.20 Employment Agreement between Textron and Richard A. McWhirter dated February 16, 1993. Incorporated by reference to Exhibit 10.11 to Textron's Annual Report on Form 10-K for the fiscal year ended January 2, 1993. 10.21 Employment Agreement between Textron and William F. Wayland dated January 1, 1989. Incorporated by reference to Exhibit 10.12 to Textron's Annual Report on Form 10-K for the fiscal year ended December 30, 1989. 10.22A Credit Agreement dated as of November 1, 1993 among Textron, the Lenders listed therein and Bankers Trust Company as Administrative Agent ("Credit Agreement"). Incorporated by reference to Exhibit 10.20A to Textron's Annual Report on Form 10-K for the fiscal year ended January 1, 1994. 10.22B First Amendment dated as of October 30, 1994 to Credit Agreement. Incorporated by reference to Exhibit 10.22B to Textron's Annual Report on Form 10-K for the fiscal year ended December 31, 1994. 10.22C Second Amendment to Credit Agreement dated as of July 1, 1995. Incorporated by reference to Exhibit (b) (3) to Schedule 14D-1 filed by Textron on September 19, 1995. 12.1 Computation of ratio of income to fixed charges of the Textron Parent Company Borrowing Group. 12.2 Computation of ratio of income to fixed charges of Textron Inc. including all majority-owned subsidiaries. 13 A portion (pages 22 and following) of Textron's 1995 Annual Report to Shareholders. Except for pages or items specifically incorporated by reference herein, such portion of Textron's 1995 Annual Report to Shareholders is furnished for the information of the Commission and is not filed as part of this Report. 21 Certain subsidiaries of Textron. Other subsidiaries, which considered in the aggregate do not constitute a significant subsidiary, are omitted from such list. 23 Consent of Independent Auditors. 24.1 Power of attorney. 24.2 Certified copy of a resolution of the Board of Directors of Textron. 27 Financial Data Schedule.