2019 Proxy Statement

TEXTRON 2019 PROXY STATEMENT 31 Long-Term Incentive Compensation Payouts and Performance Analysis Performance Share Units Payouts for the 2016 201 PSU cycle were based upon performance for each of the annual periods within the 2016 201 cycle against performance goals set for three one year performance periods, weighted equally, subject to a discretionary TSR modi¿er that can decrease, but not increase, the payout by as much as 0 , based on how Textron’s three year TSR compares to our 2016 performance peer group. The performance achieved against the threshold, target and maximum payouts for the 2016 201 PSU cycle, and the resulting percentage earned by the executive of¿cers, are detailed below: 2016-2018 Performance Share Unit Calculation ($ in millions) The performance metrics for 201 are described in more detail in the 201 Annual Incentive Compensation Calculation chart on page 29 and for previous years are described in the proxy statement for the applicable year. Payouts for each individual could range from 0 to 150 of target based on performance. Two measures impact the value of PSU payouts: (i) the number of units earned is based on Textron’s performance against operating metrics and may be adjusted downward (but not upward) in the Committee’s discretion, based upon TSR compared to its performance peer companies and (ii) the value of each unit earned is based on Textron’s stock price. The tables below show the PSU awards granted in 2016 and associated payouts by executive in terms of both units and value. To validate that the Company’s PSU awards link pay to performance, the Committee evaluated the PSU payouts on the basis of both relative performance (TSR performance vs. 2016 performance peer companies) and absolute performance (change in stock price) and concluded that the payouts were appropriately linked to Textron’s overall performance. 107.1% Units Earned as % of Original Award -27% TSR Modi¿er applied by O&C Committee 78.2% Final Payout as % of Original Award 60% 60% 60% 57.5% 59.7% 59.9% 40% 40% 40% 42.7% 51.1% 50.4% Threshold 50 Payout Target 100 Payout Actual: $1,169 Actual: $1,267 $ 71 $769 $ 27 $1,665 $1, 59 $1,577 $901 $1,150 $955 $1 5 $ 9 $2 9 Maximum 150 Payout Component :eighting Component Payout 100.2% Total Earned 110.8% 110.3% Enterprise NOP Enterprise NOP Enterprise NOP Manufacturing Cash Flow Manufacturing Cash Flow Manufacturing Cash Flow Actual: $591 Actual: $993 Actual: $784 2016 2017 2018 $5 $1,17 $1, $799 $1,269 $59 Actual: $1,309