E-Z-GO 2007 Annual Report Download - page 80

Textron Inc.
Income per Common Share
A reconciliation of income from continuing operations and basic to diluted share amounts is presented below:
2007 2006 2005
Average Average Average
(Dollars in millions, shares in thousands) Income Shares Income Shares Income Shares
Income from continuing operations
available to common shareholders $ 915 249,792 $ 706 255,098 $ 516 267,062
Dilutive effect of convertible preferred
stock and stock options — 5,034 — 5,346 — 5,830
Available to common shareholders and
assumed conversions $ 915 254,826 $ 706 260,444 $ 516 272,892
Accumulated Other Comprehensive Loss
The after-tax components of accumulated other comprehensive loss are presented below:
Pension Deferred
and Post- Gains
Currency retirement (Losses)
Translation Benefi ts on Hedge
(In millions) Adjustment Adjustments Contracts Total
Balance at January 1, 2005 $ 144 $ (263) $ 22 $ (97)
Other comprehensive income (loss) (17) 34 2 19
Balance at December 31, 2005 $ 127 $ (229) $ 24 $ (78)
Transition adjustment due to change in accounting — (647) — (647)
Other comprehensive income (loss) 45 58 (5) 98
Reclassifi cation due to sale of Fastening Systems (47) 39 — (8)
Reclassifi cation adjustment — — (9) (9)
Balance at December 30, 2006 $ 125 $ (779) $ 10 $ (644)
Other comprehensive income (loss) 57 96 53 206
Reclassifi cation adjustment — 58 (20) 38
Balance at December 29, 2007 $ 182 $ (625) $ 43 $ (400)
Note 11. Share-Based Compensation
Our 2007 Long-Term Incentive Plan (the “Plan”) supersedes the 1999 Long-Term Incentive Plan and authorizes awards to our key employees in
the form of options to purchase our shares, restricted stock, restricted stock units, stock appreciation rights, performance stock awards and other
awards. Options granted to purchase our shares have a maximum term of 10 years and vest ratably over a three-year period. Restricted stock unit
awards granted vest one-third each in the third, fourth and fi fth year following the grant. A maximum of 12 million shares is authorized for
issuance for all purposes under the Plan, plus any shares that become available upon cancellation, forfeiture or expiration of awards granted
under the 1999 Long-Term Incentive Plan. No more than 12 million shares may be awarded pursuant to incentive stock options, and no more than
3 million shares may be awarded pursuant to restricted stock or other “full value” awards intended to be paid in shares. The Plan also authorizes
performance share units paid in cash. Payouts under performance share units vary based on certain performance criteria measured over a three-
year period. The performance share units vest at the end of three years. We also provide share-based compensation awards payable in cash,
including retention awards to certain executives and restricted stock units.
Through our Deferred Income Plan for Textron Key Executives (the “DIP”), we provide participants the opportunity to voluntarily defer up to 25%
of their base salary and up to 100% of annual and long-term incentive compensation and other compensation. Elective deferrals may be put into
either a stock unit account or an interest bearing account. We generally contribute a 10% premium on amounts deferred into the stock unit
account. Executives who are eligible to participate in the DIP who have not achieved and/or maintained the required minimum stock ownership
level are required to defer annual incentive compensation in excess of 100% of the executive’s annual target into a deferred stock unit account and
are not entitled to the 10% premium contribution on the amount deferred. Participants cannot move amounts between the two accounts while
actively employed by us and cannot receive distributions until termination of employment.
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