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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 January 1, 1994
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:
Each Exchange on
Title of Class
Registered
Common Stock - par value $.125; (88,605,596 shares New York Stock Exchange
outstanding at March 4, 1994) Pacific Stock Exchange
Preferred Stock Purchase Rights Chicago Stock Exchange
$2.08 Cumulative Convertible Preferred Stock, New York Stock Exchange
Series A - no par value
$1.40 Convertible Preferred Dividend Stock, Series B New York Stock Exchange
(preferred only as to dividends) - no par value
9.25% Debentures due March 15, 2016
9.25% Subordinated Debentures due April 1, 2017 New York Stock Exchange
8 % Debentures due July 1, 2022
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 $5,140,665,797
as of March 4, 1994.
Portions of Textron's Annual Report to Shareholders for the
fiscal year ended January 1, 1994
are incorporated by reference in Parts I and II of this Report. Portions
of Textron's Proxy Statement for
its Annual Meeting of Shareholders on April 27, 1994 are incorporated by
reference in Part III of this Report.
__________________________________________________
2
PART I
ITEM 1. BUSINESS OF TEXTRON*
Textron is a multi-industry company which at the end of 1993 re-
aligned its operations into six segments in two business sectors - Manufactur-
ing and Financial Services. The Manufacturing sector consists of four busi-
ness segments - Aircraft, Automotive, Industrial, and Systems and Components.
The business segments of the Financial Services sector are Finance and Paul
Revere. Information concerning each sector and the Divisions within each sec-
tor is set forth or referred to below.
Textron's focus on selected businesses and markets is intended to
achieve balanced diversification in order to afford protection against economic
cycles and to provide a means to concentrate on growth opportunities and tech-
nologies in these businesses.
Each Textron Division conducts its business under its own name with
its own organization. Each Division's management has direct responsibility for
its own operations, and for achieving its business plan as accepted after re-
view with Textron's management. Centralized coordination and control to assure
overall standards and performance are provided by Textron's executive staff
from its corporate office at 40 Westminster Street, Providence, Rhode
Island 02903; its telephone number is (401) 421-2800.
____________________
* Reference herein to "Textron" includes Textron Inc., its divisions and subsid-
iaries. A Textron "Division" is a management-designated operating unit which
may be comprised of an unincorporated division of Textron, a subsidiary of
Textron, or an unincorporated division of a subsidiary.
3
Financial information by business segment and geographic area is
incorporated herein by reference to pages 33, 59 and 60 of Textron's 1993
Annual Report to Shareholders.
MANUFACTURING
Information regarding the Manufacturing sector is contained on pages 2, 3,
7 through 19, 24, 25, 34 through 36, 45, 46 and 67 through 69 of Textron's 1993
Annual Report to Shareholders, which pages are incorporated herein by reference.
The Aircraft segment consists of Bell Helicopter and Cessna. Bell
Helicopter is among the largest domestic manufacturers of light and medium
helicopters for military and civil uses, although certain of its competitors
are substantially larger and more diversified aircraft manufacturers. In the
light and medium helicopter market, Bell Helicopter has two major U.S.
competitors and one major European competitor. Bell Helicopter markets its
products worldwide through its own sales force as well as through independent
representatives. Price, financing terms, aircraft performance and product
support are significant factors in the sale of helicopters. Revenues of Bell
Helicopter accounted for approximately 13%, 11% and 16% of Textron's total
revenues in 1993, 1992 and 1991, respectively.
Cessna is the world's largest designer and manufacturer of light and
mid-sized business jets and single-engined utility turboprop aircraft.
Cessna markets its products worldwide primarily through its own sales force as
well as through independent representatives. Cessna has five major
competitors, two of which are located in the U.S. and three overseas.
Cessna's fanjets and turboprops compete with other aircraft that are
comparable in size, speed, range, capacity, handling characteristics and price.
The Divisions of the Automotive segment supply products primarily to
automotive original equipment manufacturers. Products are marketed through the
sales force of each Division. In general, these Divisions operate in markets
4
that are very competitive. These Divisions compete in their markets on the
basis of price, product quality and delivery.
The Divisions of the Industrial segment sell products to the industrial
and consumer markets. Products are marketed through the sales force of each
Division, and, where applicable, independent distributors, sales
representatives and retailers. In general, these Divisions operate in markets
that are very competitive. In varying degrees, these Divisions compete in
their markets on the basis of price, product quality and performance, brand
image, service and delivery. In 1993, Textron's Townsend Division was merged
into the Camcar Division.
Textron Lycoming Turbine Engine, the major line of business in the Systems
and Components segment, is a supplier of propulsion systems and related
products, with six major competitors in the gas turbine engine market. These
competitors are based in the United States, Canada and Europe. Several of its
competitors are substantially larger than Textron Lycoming Turbine Engine. All
Divisions of the Systems and Components segment are subject to keen
competition. Each Division markets its products through its own sales force
and, where applicable, independent representatives. The principal competitive
factors are price, reliability, product performance and, where applicable,
product support. The Cadillac Gage Combat Vehicle Operations and the Cadillac
Gage Control Systems Operations are being transferred to the Textron Marine
and Land Systems Division and the HR Textron Division, respectively.
FINANCIAL SERVICES
Information regarding the Financial Services sector is contained on pages
3, 7, 20 through 22, 31, 32, 36, 37, 46, 63, 64 and 70 of Textron's 1993 Annual
Report to Shareholders, which pages are incorporated herein by reference.
Products of the Financial Services sector are marketed through
company-owned sales offices and, where applicable, independent brokers. The
insurance and consumer and commercial finance businesses are highly competitive
and subject to regulation by various government authorities.
5
The Finance segment consists of Avco Financial Services and Textron
Financial Corporation. Avco Financial Services competes with other consumer
finance companies as well as companies which finance the sale of their own
merchandise or the merchandise of others, industrial banks, and the personal
loan departments of commercial banks and credit unions. Revenues of Avco
Financial Services accounted for approximately 15%, 16% and 17% of Textron's
total revenues in 1993, 1992 and 1991, respectively. Textron Financial
Corporation competes with other commercial finance companies as well as
institutional lenders, primarily banks. Price and service are the principal
competitive factors in the Finance segment.
Paul Revere is the leading provider of individual non-cancellable
disability insurance in North America. Paul Revere competes with many other
insurance companies offering similar products. 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 33 of Textron's 1993 Annual Report to Shareholders, which page is
incorporated herein by reference.
Approximately 47% of Textron's total backlog at January 1, 1994 represents
orders which are not expected to be filled within the 1994 fiscal year. Approx-
imately 76% of the total backlog is funded.
GOVERNMENT CONTRACTS
In 1993, 23% and 43% of the revenues of the Aircraft and Systems and Compo-
nents segments, respectively, were generated by or resulted from contracts
6
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 con-
tracts, including some which are fixed-price incentive development contracts.
Contracts which contain incentive pricing terms provide for upward or downward
adjustments in the prices paid by the U.S. Government thereunder upon comple-
tion 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 and an allowance for profit (up to a maximum equal to the con-
tract price) 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 contrac-
tor's costs with respect to unaccepted items and is entitled to repayment of
advance payments and progress payments, if any, related to the terminated por-
tions 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. Additional information regarding defense expenditures is contained on
pages 34 through 36 of Textron's 1993 Annual Report to Shareholders, which
pages are incorporated herein by reference.
RESEARCH AND DEVELOPMENT
Information regarding Textron's research and development expenditures is
contained on pages 45 and 53 of Textron's 1993 Annual Report to Shareholders,
which pages are incorporated herein by reference.
7
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. Pat-
ents 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 has not had, and is not expected
to have, a material effect on capital expenditures, earnings or the competitive
position of Textron. Expenditures for environmental control facilities have
not had, and are not expected to have, a material effect on capital expendi-
tures, earnings or the competitive position of Textron. Additional information
regarding environmental matters is contained on pages 30, 45 and 59 of
Textron's 1993 Annual Report to Shareholders, which pages are incorporated
herein by reference.
EMPLOYEES
At January 1, 1994, Textron had approximately 56,000 employees.
ITEM 2. PROPERTIES
At January 1, 1994, Textron operated a total of 146 plants located through-
out the United States and 6 plants outside the United States. Of the total of
152 plants, Textron owned 112 and the balance was leased. In the aggregate,
the total manufacturing space was approximately 27 million square feet.
8
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.
A material portion of the plant, machinery and equipment used by Textron
Lycoming Turbine Engine at Stratford, Connecticut, is owned by the U.S. Govern-
ment and is provided pursuant to facilities contracts which authorize the Divi-
sion to use it without charge in the performance of government contracts. In
addition, use is permitted under certain limited circumstances in the perfor-
mance of commercial work if governmental approval is obtained and appropriate
rentals are paid to the government. These facilities contracts are terminable
by the U.S. Government at any time, but Textron does not anticipate that any
such termination will occur so long as the facilities are required in the per-
formance of material U.S. Government contracts, or that it will be prevented
from using the facilities for commercial work so long as all governmental re-
quirements are met.
ITEM 3. LEGAL PROCEEDINGS
In early 1989, Textron acquired Avdel plc, a fastening systems manufactur-
ing business based in England, the total cost of which approximated $250 mil-
lion. In February 1989, the U.S. Federal Trade Commission ("FTC") challenged
the acquisition under antitrust law. On October 28, 1993, the FTC conditional-
ly approved Textron's offer to settle the matter by licensing a new competitor
for Avdel's MONOBOLT non-aerospace blind rivet and selling the licensee cer-
tain manufacturing equipment of Avdel's U.S. operation. The settlement and
approval of the license/divestiture are expected to become effective in 1994.
Until the settlement becomes effective, Textron is precluded from consolidating
in its financial statements the results of operations of Avdel and is therefore
carrying its investment in Avdel at cost.
9
Since 1979, Textron has been engaged in arbitration in Switzerland with
the Government of Iran concerning conflicting claims and counterclaims arising
out of a 1975 helicopter coproduction agreement between its Bell Helicopter
Division and the Government of Iran. The contract was terminated in 1978 and
the arbitration started in 1979. Bell Helicopter and the Government of Iran
are currently engaged in settlement discussions. In the opinion of management
any costs incurred by Bell associated with the arbitration in excess of amounts
previously reserved will not be material to Textron's net income or financial
condition.
On October 5, 1993, the Ohio Environmental Protection Agency ("Ohio EPA")
issued a proposed consent order concerning compliance issues related to air
emissions from Textron's Randall Division plant in Wilmington, Ohio. The Ohio
EPA is seeking a civil penalty of $579,000. Textron is negotiating with the
Ohio EPA to resolve the matter.
In addition, 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; the cleanup of allegedly hazardous wastes; or,
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. These suits and proceedings are being defended or contested on
behalf of Textron and its subsidiaries.
On the basis of information presently available, Textron believes that any
liability for the suits and proceedings mentioned above, or the impact of the
application of relevant government regulations, would not have a material ef-
fect on Textron's net income or financial condition.
10
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 15, 1994. Unless otherwise indicated, the
employer is Textron.
Name Age Position
James F. Hardymon 59 Chairman since 1993, and Chief Execu-
tive Officer since 1992; formerly
President, 1989 through 1993, and
Chief Operating Officer, 1989 through
1991; Director since 1989.
CORPORATE OPERATING MANAGEMENT
Lewis B. Campbell 47 President and Chief Operating Officer
since January 1994; formerly Execu-
tive Vice President and Chief Operat-
ing Officer, 1992 to 1993; Vice Presi-
dent of General Motors (1988 to 1992)
and General Manager of its GMC
Truck Division (1991 to 1992), and
General Manager of the Flint Automo-
tive Division Buick - Oldsmobile
- Cadillac Group (1988 to 1991);
Director since January 1994.
11
Gary E. Atwell 50 Group Vice President since 1986.
Richard H. Campbell 58 Group Vice President since 1992;
formerly Group Vice President and
President - Hardware Home Improvement
Group of Black & Decker Corporation,
1989 to 1992.
Herbert L. Henkel 45 Group Vice President since October
1993; formerly President of the
Greenlee Textron Division, 1987 to
October 1993.
Fred L. Hubacker 49 Group Vice President and President
Textron Acustar Plastics Inc. since
May 1993; formerly Group Controller,
Procurement and Supply Operations
(1991 to April 1993) and Vice Presi-
dent Finance, Acustar Inc. unit (1989
to 1991) of Chrysler Corporation.
Derek Plummer 60 Group Vice President since 1986.
Terry D. Stinson 52 Group Vice President since 1991;
formerly President of the Hamilton
Standard Division of United Technolo-
gies Corporation, 1986 to 1991.
Richard A. Watson 49 Group Vice President since 1990;
formerly Vice President Textron and
President Textron Investment Manage-
ment Company Inc., 1986 to 1990.
12
CORPORATE STAFF MANAGEMENT
Thomas P. Hollowell 50 Executive Vice President Corporate
Development since 1992; formerly
Managing Director of Bowles Hollowell
Conner & Co., an investment banking
firm, 1975 to 1992.
Richard A. McWhirter 59 Executive Vice President and Chief
Financial Officer since 1993; former-
ly Senior Vice President and Secre-
tary, 1991 to 1993; Senior Vice Presi-
dent - Insurance and Environmental
Affairs, 1988 to 1991.
Thomas D. Soutter 59 Executive Vice President and General
Counsel since 1985.
William F. Wayland 58 Executive Vice President Administra-
tion and Chief Human Resources Offi-
cer since 1993; formerly Executive
Vice President - Human Resources,
1989 to 1993.
Frank Gulden 57 Senior Vice President - Human Resourc-
es, since December 1993; formerly
Group Vice President, 1990 to Decem-
ber 1993; Vice President North and
South America, Fastening Systems
Group of Emhart Corporation, 1989 to
1990.
Mary L. Howell 41 Senior Vice President Government and
International Relations since 1993;
13
formerly Vice President - Government
Affairs, 1985 to 1993.
Edward C. Arditte 38 Vice President - Investor Relations
and Risk Management since 1993; for-
merly Vice President - Investor Rela-
tions, 1991 to 1993; Director - Inves-
tor Relations, 1990 to 1991; Assis-
tant Treasurer, 1986 to 1990.
Raymond W. Caine, Jr. 61 Vice President - Corporate Communica-
tions since 1980.
Robert B. Clendenen 51 Vice President - Audit and Business
Ethics since 1988.
Brian T. Downing 46 Vice President and Treasurer since
1986.
Arnold M. Friedman 51 Vice President and Deputy General
Counsel since 1984.
Gregory E. Hudson 47 Vice President - Taxes since 1987.
William P. Janovitz 51 Vice President and Controller since
1983.
Cecil W. Labhart 61 Vice President - Information Systems
Services since 1986.
Karen A. Quinn-Quintin 36 Vice President and Secretary since
1993; formerly Director, Corporate
Office Human Resources, 1992 to 1993;
Manager, Corporate Office Personnel,
14
1991 to 1992; Manager, Group Insur-
ance, 1989 to 1991.
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 Regis-
trant's Common Equity and Related Stockholder Matters" is contained on pages
65, 66 and on the inside back cover of Textron's 1993 Annual Report to Share-
holders, which pages are incorporated herein by reference.
ITEM 6. SELECTED FINANCIAL DATA
Information regarding "Selected Financial Data" is contained in the Five
Year Summary on page 66 of Textron's 1993 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 in the Financial Review on pages 29 through 37 of
Textron's 1993 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 state-
ment schedules are filed as part of this Report.
15
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 of Textron's Proxy Statement for the 1994 Annual Meeting of Shareholders on
April 27, 1994, which pages are incorporated herein by reference.
Information regarding Textron's executive officers is included on pages 10
through 14 of Part I of this Report.
ITEM 11. EXECUTIVE COMPENSATION
Information regarding "Executive Compensation" is contained on pages 15
through 20 of Textron's Proxy Statement for the 1994 Annual Meeting of Share-
holders on April 27, 1994, 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"
is contained on page 9, and information regarding "Security Ownership of Manage-
ment" is contained on pages 9 through 11, of Textron's Proxy Statement for the
1994 Annual Meeting of Shareholders on April 27, 1994, which pages are incorpo-
rated herein by reference.
16
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Information regarding certain relationships and related transactions is
contained on page 20 of Textron's Proxy Statement for the 1994 Annual Meeting
of Shareholders on April 27, 1994, which page is incorporated herein by refer-
ence.
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 finan-
cial statement schedules listed in the accompanying index to financial state-
ments 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.
NOTE: Exhibits 10.1 through 10.19 below are management contracts or
compensatory plans, contracts or agreements.
10.1A Supplemental Benefits Plan for Textron Key Executives effec-
tive from and after December 16, 1987 ("Supplemental Plan").
17
Incorporated by reference to Exhibit 10.1 to Textron's Annual
Report on Form 10-K for the fiscal year ended January 2, 1988.
10.1B Market Square Profit Sharing Plan Schedule to Supplemental
Plan effective as of January 1, 1989, amended and restated as
of December 10, 1991. Incorporated by reference to Exhibit
10.1(b) to Textron's Annual Report on Form 10-K for the fiscal
year ended December 28, 1991.
10.1C Amendment to Market Square Profit Sharing Plan Schedule to
Supplemental Plan effective December 30, 1992. Incorporated
by reference to Exhibit 10.1(f) to Textron's Annual Report on
Form 10-K for the fiscal year ended January 2, 1993.
10.1D Ex-Cell-O Salaried Retirement Plan Schedule to Supplemental
Plan effective as of July 1, 1989, amended and restated as of
July 1, 1991. Incorporated by reference to Exhibit 10.1(c) to
Textron's Annual Report on Form 10-K for the fiscal year ended
December 28, 1991.
10.1E First Amendment to Supplemental Plan effective as of April 25,
1990. Incorporated by reference to Exhibit 10.1(d) to
Textron's Annual Report on Form 10-K for the fiscal year ended
December 29, 1990.
10.1F Second Amendment to Supplemental Plan effective as of Septem-
ber 25, 1991. Incorporated by reference to Exhibit 10.1(e) to
Textron's Annual Report on Form 10-K for the fiscal year ended
December 28, 1991.
10.2 Survivor Benefit Plan for Textron Key Executives effective
from and after December 16, 1987. Incorporated by reference
to Exhibit 10.2 to Textron's Annual Report on Form 10-K for
the fiscal year ended January 2, 1988.
18
10.3A Deferred Income Plan for Textron Key Executives effective from
and after December 16, 1987. Incorporated by reference to
Exhibit 10.3 to Textron's Annual Report on Form 10-K for the
fiscal year ended January 2, 1988.
10.3B First Amendment to Deferred Income Plan for Textron Key Execu-
tives effective as of October 27, 1992. Incorporated by refer-
ence to Exhibit 10.3(b) to Textron's Annual Report on Form
10-K for the fiscal year ended January 2, 1993.
10.4A Corporate Office Annual Incentive Compensation Plan executed
on December 23, 1987. Incorporated by reference to Exhibit
10.4 to Textron's Annual Report on Form 10-K for the fiscal
year ended January 2, 1988.
10.4B First Amendment to Corporate Office Annual Incentive Compensa-
tion Plan effective as of December 10, 1992. Incorporated by
reference to Exhibit 10.4(b) to Textron's Annual Report on
Form 10-K for the fiscal year ended January 2, 1993.
10.5A Textron 1982 Long-Term Incentive Plan ("1982 Plan"). Incorpo-
rated by reference to Exhibit 10.5(a) to Textron's Annual
Report on Form 10-K for the fiscal year ended December 31,
1988.
10.5B First Amendment to 1982 Plan effective as of
February 25, 1987. 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.
10.5C Second Amendment to 1982 Plan effective as of December 16,
1987. 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.
19
10.6A Textron 1987 Long-Term Incentive Plan ("1987 Plan") effective
as of February 25, 1987, amended and restated as of April 27,
1988. Incorporated by reference to Exhibit 10.6 to Textron's
Annual Report on Form 10-K for the fiscal year ended December
30, 1989.
10.6B First Amendment to 1987 Plan effective as of September 25,
1991. 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.
10.7A Textron 1990 Long-Term Incentive Plan ("1990 Plan") effective
as of April 25, 1990. Incorporated by reference to Exhibit
10.7 to Textron's Annual Report on Form 10-K for the fiscal
year ended December 30, 1989.
10.7B First Amendment to 1990 Plan effective as of September 25,
1991. Incorporated by reference to Exhibit 10.7(b) to
Textron's Annual Report on Form 10-K for the fiscal year ended
December 28, 1991.
10.7C Second Amendment to 1990 Plan effective as of December 10,
1992. 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.
10.8 Employment Agreement between Textron and James F. Hardymon
dated November 24, 1989 ("Employment Agreement"). Incorporat-
ed by reference to Exhibit 10.9 to Textron's Annual Report on
Form 10-K for the fiscal year ended December 30, 1989.
10.9 Employment Agreement between Textron and Lewis B. Campbell
dated as of September 22, 1992. Incorporated by reference to
20
Exhibit 10.9 to Textron's Annual Report on Form 10-K for the
fiscal year ended January 2, 1993.
10.10 Employment Agreement between Textron and Thomas P. Hollowell
dated as of January 1, 1993. Incorporated by reference to
Exhibit 10.10 to Textron's Annual Report Form 10-K for the
fiscal year ended January 2, 1993.
10.11 Employment Agreement between Textron and Mary L. Howell dated
as of May 4, 1993.
10.12 Employment Agreement between Textron and Richard A. McWhirter
dated as of 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.
10.13 Employment Agreement between Textron and Thomas D. Soutter
dated as of March 1, 1985, as amended by Amendment to Employ-
ment Agreement dated as of February 1, 1987 and Amendment to
Employment Agreement dated as of February 1, 1988. Incorporat-
ed by reference to Exhibit 10.11 to Textron's Annual Report on
Form 10-K for the fiscal year ended December 30, 1989.
10.14 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.
10.15 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
10.16 Textron Executive Severance Plan effective December 16, 1987.
Incorporated by reference to Exhibit 10.13 to Textron's Annual
Report on Form 10-K for the fiscal year ended January 2, 1988.
10.17A Pension Plan for Directors originally effective as of March 8,
1986, as amended by a First Amendment effective as of August
26, 1987. Incorporated by reference to Exhibit 10.14 to
Textron's Annual Report on Form 10-K for the fiscal year ended
December 31, 1988.
10.17B Second Amendment to Pension Plan for Directors effective as of
October 1, 1990. Incorporated by reference to Exhibit
10.16(b) to Textron's Annual Report on Form 10-K for the fis-
cal year ended December 29, 1990.
10.18 Deferred Income Plan for Textron Directors effective May 26,
1993.
10.19 Additional Benefits for certain executive officers. Incorpo-
rated by reference to Exhibit 10.16 to Textron's Annual Report
on Form 10-K for the fiscal year ended January 2, 1988.
10.20A Credit Agreement dated as of November 1, 1993 among Textron,
the Lenders listed therein and Bankers Trust Company as Admin-
istrative Agent.
10.20B Line of Credit dated as of November 1, 1993 among Textron, the
Lenders listed therein and Bankers Trust Company as Administra-
tive Agent.
12.1 Computation of ratio of income to fixed charges of the Textron
Parent Company Borrowing Group.
22
12.2 Computation of ratio of income to fixed charges of Textron
Inc. including all majority-owned subsidiaries.
13 Textron's 1993 Annual Report to Shareholders. Except for
pages or items specifically incorporated by reference herein,
Textron's 1993 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.
(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.
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 28th day of March, 1994.
23
TEXTRON INC.
Registrant
By: S/Arnold M. Friedman
Arnold M. Friedman
Attorney-in-fact
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed below on this 28th day of March, 1994, by the following
persons on behalf of the registrant and in the capacities indicated:
NAME TITLE
* Chairman and Chief Executive Officer,
James F. Hardymon Director (principal executive officer)
* President and Chief Operating
Lewis B. Campbell Officer, Director
* Director
H. Jesse Arnelle
* Director
Joseph R. Carter
* Director
R. Stuart Dickson
* Director
B.F. Dolan
* Director
William M. Ellinghaus
* Director
Webb C. Hayes, III
24
* Director
John D. Macomber
* Director
Barbara Scott Preiskel
* Director
Sam F. Segnar
* Director
Jean Head Sisco
* Director
John W. Snow
* Director
J. Paul Sticht
* Director
Martin D. Walker
* Director
Thomas B. Wheeler
* Executive Vice President and
Richard A. McWhirter Chief Financial Officer (principal)
financial officer)
* Vice President and Controller
William P. Janovitz (principal accounting officer)
*By: S/Arnold M. Friedman
Arnold M. Friedman
Attorney-in-fact
25
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 38
Consolidated Statement of Income for each of the
three years in the period ended January 1, 39
1994
Consolidated Balance Sheet at January 1, 1994
and January 2, 1993 40
Consolidated Statement of Cash Flows for each of
the three years in the period ended January 1, 41
1994
Consolidated Statement of Changes in
Shareholders' Equity for each of the three
years in the period ended January 1, 1994 42
Summary of Significant Accounting Policies 43 - 45
Notes to Consolidated Financial Statements 45 - 64
Revenues and Income by Business Segment 33
Supplementary Information (Unaudited):
Quarterly Financial Information 1993 and 1992 65
Financial Statement Schedules for each of the
three years in the period ended January 1,
1994
III Condensed financial information of 26
registrant
VIII Valuation and qualifying accounts 27
IX Short-term borrowings 28
X Supplementary income statement 29
information
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.
26
TEXTRON INC.
SCHEDULE III - CONDENSED FINANCIAL INFORMATION OF REGISTRANT
For each of the three years in the period ended January 1, 1994
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 pages 61-62 of Textron's
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
reflected under the caption "Investments in finance and insurance
subsidiaries."
The Textron Parent Company Borrowing Group received dividends of $93.5
million, $78.4 million and $78.2 million from its finance and insurance
subsidiaries in 1993, 1992 and 1991, 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 January 1, 1994, approximately $311 million of their net
assets of $2.2 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 8 to
the consolidated financial statements appearing on pages 50-51 of Textron's
1993 Annual Report to Shareholders.
27
TEXTRON INC.
SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS
For each of the three years in the period ended January 1, 1994
(In millions)
Allowance for credit losses on finance receivables 1993 1992 1991
Balance at beginning of year $ 212.4 $ 183.3 $ 176.0
Additions charged to income (a) 171.2 188.6 160.2
Deductions from reserves (b) (158.8) (176.1) (152.9)
Acquisitions and other items (.2) 16.6 -
Balance at end of year $ 224.6 $ 212.4 $ 183.3
(a) Exclude the effect of recoveries on accounts previously written off of
$28.9 million, $28.2 million and $25.4 million in 1993, 1992 and 1991,
respectively, which have been credited directly to income.
(b) Consist primarily of receivables written off.
28
TEXTRON INC.
SCHEDULE IX - SHORT-TERM BORROWINGS
For each of the three years in the period ended January 1, 1994
(In millions)
End of year Maximum Average Weighted
Weighted amount amount average
average outstanding outstanding interest
interest during the during the rate during
Balance rate year year* the year*
Year ended January 1, 1994
Commercial paper $ 2,778.0 3.7% $ 2,778.1 $ 2,557.1 3.7%
Debt to banks 82.1 4.4% $ 203.2 133.0 3.8%
TOTAL $ 2,860.1 3.7% $ 2,860.1 $ 2,690.1 3.7%
Year ended January 2, 1993:
Commercial paper $ 2,145.3 4.5% $ 2,510.3 $ 2,242.1 4.4%
Debt to banks 269.6 4.4% $ 582.8 427.1 4.5%
TOTAL $ 2,414.9 4.5% $ 3,043.4 $ 2,669.2 4.4%
Year ended December 28, 1991:
Commercial paper $ 1,948.2 5.6% $ 1,954.5 $ 1,841.5 6.8%
Debt to banks 133.5 5.6% $ 170.3 120.3 8.5%
TOTAL $ 2,081.7 5.6% $ 2,081.7 $ 1,961.8 6.9%
* The average amount outstanding during each year was computed by averaging the
daily ending balances during the year. The weighted average interest rate
during each year was determined based on daily outstanding principal amounts
and excludes the cost of maintaining the lines of credit.
NOTE: This schedule excludes borrowings under or supported by long-term credit
facilities of the Textron Parent Company Borrowing Group.
29
TEXTRON INC.
SCHEDULE X - SUPPLEMENTARY INCOME
STATEMENT INFORMATION
For each of the three years in the period ended January 1, 1994
(In millions)
Charged to costs and expenses
1993 1992 1991
Maintenance and repairs $ 104.2 $ 100.2 $ 113.8
TEXTRON INC.
Index of Exhibits
Annual Report on Form 10-K
for the Fiscal Year Ended January 1, 1994
Exhibit Description
10.11 Employment Agreement between Textron and Mary L.
Howell dated as of May 4, 1993.
10.17 Deferred Income Plan for Textron Directors
effective May 26, 1993.
10.20A Credit Agreement dated as of November 1, 1993
among Textron, the Lenders listed therein
and Bankers Trust Company as Administrative
Agent.
10.20B Line of Credit dated as of November 1, 1993 among
Textron, the Lenders listed therein and Bankers
Trust Company as Administrative Agent.
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 Textron's 1993 Annual Report to Shareholders.
Except for pages or items specifically
incorporated by reference herein, Textron's
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.