E-Z-GO 2005 Annual Report Download - page 82

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Restricted stock activity under the Plan for 2005 is as follows:
Weighted-
Average
Number of Grant Date
(Shares in thousands)
Shares Fair Value
Outstanding at beginning of year, nonvested 867 $ 49.44
Granted 353 71.13
Vested (5) 39.63
Forfeited (59) 51.50
Outstanding at end of year, nonvested 1,156 $ 55.99
Share-Based Compensation Awards Accounted for as Liabilities
The fair value of share-based compensation awards accounted for as liabilities includes performance share units, retention awards and DIP stock
unit awards. The fair value of these awards is based on the trading price of Textron common stock, less adjustments to reflect the fair value of the
award as dividends are not paid or accrued until vested, and is remeasured at each reporting period date.
Share-Based Compensation Awards
The value of the share-based compensation awards that vested and/or were paid during the respective periods is as follows:
(In millions)
2005 2004 2003
Subject only to service conditions:
Value of shares, options or units vested $ 21 $ 36 $ 16
Intrinsic value of cash awards paid $ 9 $ 8 $ 5
Subject to performance vesting conditions:
Value of units vested $ 37 $ 26 $ 16
Intrinsic value of cash awards paid $ 25 $ 15 $ 8
Intrinsic value of amounts paid under DIP $ 18 $ 7 $ 10
As of December 31, 2005, $58 million represents the total compensation cost associated with unvested awards subject only to service conditions
that has not yet been recognized. Textron expects that this compensation will be recognized over a weighted-average period of approximately two
years. As of December 31, 2005, $25 million represents the total compensation cost associated with unvested share-based compensation awards
subject to performance vesting conditions that has not yet been recognized. Textron expects that this compensation will be recognized over a
weighted-average period of approximately two years.
Note 14. Pension Benefits and Postretirement Benefits Other Than Pensions
Textron has defined benefit and defined contribution pension plans that together cover substantially all employees. The cost of the defined contri-
bution plans amounted to approximately $45 million in 2005, $23 million in 2004 and $15 million in 2003. The increase in cost related to the
defined contribution plans reflects changes to Textron’s matching contribution rate over the past three years. In April 2003, Textron temporarily
suspended matching contributions to its U.S.-based defined contribution plans for non-bargained employees. Effective January 1, 2004, the
matching contributions were partially reinstated, with Textron matching $0.25 for each $1.00 of employee contribution up to a maximum Textron
matching contribution of 2.5% of eligible compensation. Matching contributions were raised to their original level of $0.50 for each $1.00 of
employee contribution up to a maximum Textron matching contribution of 5% of eligible compensation in August 2004.
Defined benefits under salaried plans are based on salary and years of service. Hourly plans generally provide benefits based on stated amounts
for each year of service. Textron’s funding policy is consistent with federal law and regulations. Textron also offers healthcare and life insurance
benefits for certain retired employees, which are included below under the “Postretirement Benefits Other Than Pensions” caption.
62
Textron Inc.