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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )

☑

Filed by the Registrant

☐

Filed by a party other than the Registrant

CHECK THE APPROPRIATE BOX:
☐		Preliminary Proxy Statement
☐		Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
☑		Definitive Proxy Statement
☐		Definitive Additional Materials
☐		Soliciting Material under §240.14a-12

Raytheon Technologies Corporation

(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

PAYMENT OF FILING FEE (CHECK ALL BOXES THAT APPLY):
☑		No fee required
☐		Fee paid previously with preliminary materials
☐		Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11

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Our Values

At Raytheon Technologies, we hold ourselves to
the highest standard and live by our values:

		Trust
		We act with integrity and do the right thing.
		Respect
		We embrace diverse perspectives and treat others the way they want to be treated.
		Accountability
		We honor our commitments, expect excellence and take pride in our work.
		Collaboration
		We share insights, learn together and act as a team.
		Innovation
		We experiment, design, build and transform with speed and agility.

These values drive our actions, behaviors and
performance to create a safer, more connected world.

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March 14, 2022

Notice of 2022 Annual Meeting of Shareowners

 

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Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Shareowners to be held on April 25, 2022. This Notice of the 2022 Annual Meeting of Shareowners and Proxy Statement, as well as RTX’s 2021 Annual Report are available free of charge at www.proxyvote.com or at www.rtx.com/proxy. References in either document to our website are for the convenience of readers, and information available at or through our website is not a part of, nor is it incorporated by reference in, the Proxy Statement or Annual Report.

The Board of Directors of Raytheon Technologies Corporation (“RTX,” the “Company” or the “Corporation”) is soliciting proxies to be voted at our 2022 Annual Meeting of Shareowners on April 25, 2022, and at any postponed or reconvened meeting. We expect that the Proxy materials or a notice of internet availability will be mailed and made available to shareowners beginning on or about March 14, 2022. At the meeting, votes will be taken on the matters listed in the Notice of 2022 Annual Meeting of Shareowners.

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	Proxy Summary
	This section highlights selected information in this Proxy Statement. Please review the entire Proxy Statement and our 2021 Annual Report before voting your shares.

	Annual Meeting Agenda
					Board recommendation		Page numbers
	Proposal 1:		Election of Directors		FOR each director nominee		11-21
	Proposal 2:		Advisory Vote to Approve Executive Compensation		FOR		37-38
	Proposal 3:		Appoint PricewaterhouseCoopers LLP to Serve as Independent Auditor for 2022		FOR		88-89
	Proposal 4:		Approve an Amendment to the Restated Certificate of Incorporation to Reduce the Voting Threshold Required to Repeal Article Ninth		FOR		90-91
	2021 Performance Highlights
	2021 marked our first full year as Raytheon Technologies (“RTX”). Our performance confirms the merits of the merger between United Technologies Corporation (“UTC”) and Raytheon Company (the “Merger”) and our ability to transform our organization, to lead our industry and solve our customer’s most difficult challenges. We continued to navigate through a challenging operating environment due to the COVID-19 pandemic and related factors, while capitalizing on the commercial aerospace recovery and the continued strength of our defense businesses.

	“Our 2021 performance demonstrated the strength, balance and resiliency of our portfolio, the breadth of our advanced technologies, the talents and dedication of our workforce, and our commitment to changing the world for the better.”
	Gregory J. Hayes, Chairman & Chief Executive Officer

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PROXY SUMMARY | 2021 PERFORMANCE HIGHLIGHTS

FINANCIAL PERFORMANCE⁽¹⁾

In 2021, we delivered solid financial results, and we remain well positioned to deliver on the 2020-2025 organic sales growth, adjusted margin expansion and free cash flow goals that we communicated during our Investor Day in May 2021.

 

(1)	See Appendix A on pages 102-103 for more information regarding non-GAAP financial measures.
(2)	GAAP cash flow is cash flow from operating activities of continuing operations, while non-GAAP cash flow is free cash flow from continuing operations.

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PROXY SUMMARY | 2021 PERFORMANCE HIGHLIGHTS

CAPITAL RETURNED TO INVESTORS Our financial strength gave us the confidence to increase our commitment to return over $20 billion of capital to shareowners within four years of the Merger. During 2021, our investors saw total shareowner return (“TSR”) of 23.3%, outpacing both the Dow Jones Industrial Average and our core aerospace and defense peers (“Core A&D Peers”).(1) We returned $5.3 billion to investors through dividends and share repurchases, including a 7.4% increase(2) in our dividend per share.

EXECUTION ON KEY PRIORITIES

In 2021, we continued to execute on the key priorities that underpin our business strategy.

 

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PROXY SUMMARY | EXECUTIVE COMPENSATION OVERVIEW

Executive Compensation Overview

HOW WE ALIGN PAY WITH PERFORMANCE

Our executive compensation program is structured to advance our fundamental objective: aligning our executives’ compensation with the long-term interests of our shareowners.

Since the Merger, our Human Capital & Compensation Committee (the “Committee”) has undertaken an extensive review of our legacy companies’ programs. In its ongoing efforts to fully integrate our programs, the Committee’s primary goal has been to design a program that rewards financial and operating performance, effective strategic leadership, and advances our commitment to corporate social responsibility—all key elements in building sustainable shareowner value. This pay-for-performance philosophy is embedded into our Guiding Principles (see page 43) that underpin how the Committee has approached the program design integration since the Merger.

How does our executive compensation program align pay with performance?

●	We use performance metrics and objectives that recognize and reward performance contributions that drive strategy into action, maximize performance and deliver results.
●	The largest portion of compensation for our Named Executive Officers (“NEOs”) is “at-risk” compensation—annual and long-term incentive awards that are contingent on Company performance in our key metrics and objectives, in addition to our stock price performance.

2021 Pay Decisions

In making annual pay decisions, the Committee employs a measure called “total direct compensation,” which includes our three principal elements of executive compensation: base salary, annual incentives and long-term incentives (“LTI”). See pages 47-53 for details.

Total direct compensation reflects how an executive’s pay relates to the Committee’s assessment of Company, business unit and individual performance for the year. For this reason, 2021 total direct compensation includes the LTI grant values approved by the Committee in February 2022 (which were based on its assessment of 2021 performance) rather than the February 2021 LTI award grant date fair values shown in the Summary Compensation Table on page 66 (which were based on the Committee’s assessment of 2020 performance and the accounting value at the time of grant). For more details on total direct compensation, see page 55.

The below table shows the total direct compensation for our NEOs who were employed by the Company through the end of the year.

PAY DECISIONS AND PAY MIX

				Base Salary ($K)(1)		Annual Incentive ($K)		LTI ($K)(2)		Total ($K)
Gregory J. Hayes				$1,600		$4,992		$15,250		$21,842
Neil G. Mitchill, Jr.				$800		$1,200		$4,000		$6,000
Michael R. Dumais(3)				$880		$1,200		$0		$2,080
Christopher T. Calio				$750		$1,200		$7,000		$8,950
Stephen J. Timm				$750		$1,200		$5,000		$6,950

(1)	Reflects the base salary in effect for each NEO as of December 31, 2021. Values above differ from those in the Summary Compensation Table on page 66, since they do not reflect the impact of salary adjustments (if any) made during the year and reductions from furloughs at Pratt & Whitney and Collins Aerospace for Messrs. Calio and Timm, respectively.
(2)	Reflects values approved by the Committee for the LTI award granted on February 15, 2022. These values differ from the values that will be reported in the Summary Compensation Table in 2023, which will be calculated in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 718, Compensation—Stock Compensation.
(3)	Mr. Dumais did not receive an LTI award on February 15, 2022, since he will transition into a consulting role later in the year.

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PROXY SUMMARY | EXECUTIVE COMPENSATION OVERVIEW

2021 Performance Metrics

The Committee believes that the metrics used for our annual and long-term incentive plans are essential indicators of the long-term health of our Company, and therefore, serve the fundamental objective of our executive compensation program.

Why these metrics? Each of these metrics measures a particularly salient aspect of Company performance.

Metrics for Annual Incentives*
FINANCIAL METRICS: Earnings measure the immediate impact of operating decisions on the Company’s annual performance. For our Corporate executives, we use net income as our RTX-wide earnings metric and for our business units, we use operating income. Free Cash Flow (“FCF”) measures our ability to generate cash to fund our operations and key business investments—whether that means funding critical research and development, strategic acquisitions, paying down debt or distributing earnings to our shareowners.		CORPORATE RESPONSIBILITY SCORECARD (“CRS”): People & Culture (“P&C”) measures our progress toward our long-term diversity, equity and inclusion and talent objectives. Sustainability & Safety (“S&S”) measures our progress toward our long-term objectives for environmental sustainability and employee health and safety.
Metrics for Performance Share Units*
Earnings Per Share (“EPS”) measures the Company’s ability to create long-term, sustainable earnings that will ultimately drive total shareowner return. Return on Invested Capital (“ROIC”) measures the efficiency with which we allocate capital resources, taking into account not just the quantity of earnings, but also the quality of earnings and investments that drive sustainable growth.		Relative Total Shareowner Return (“TSR”) measures our ability to return value to our shareowners compared to competing investment opportunities like the S&P 500 and our Core A&D Peers and reinforces our pay-for-performance objectives.

*	See Appendix B on page 104 for definitions of the financial metrics referenced in this chart.

How 2021 Performance Affected Annual Incentive Payouts

In 2021, the Committee set performance goals for the key financial metrics noted above and established objectives for our new Corporate Responsibility Scorecard, as discussed in more detail on pages 48-51. The following chart shows the financial goals set for annual incentive purposes, RTX’s 2021 performance relative to these goals, the Committee’s assessment of CRS performance, and how these results translated into the 2021 RTX performance factor.

Metric*		Weight		Threshold		Target		Maximum		Actual		Performance Factor
RTX Earnings—net income ($M)		40%		$4,775		$5,600		$6,460		$6,465		200%
RTX Free Cash Flow ($M)		40%		$3,500		$4,500		$6,100		$5,105		138%
RTX People & Culture		10%			Performance evaluated by the Committee							100%
RTX Sustainability & Safety		10%			Performance evaluated by the Committee							110%
RTX Performance Factor												156%

*	Results for our business units differ from the above (see page 50 for details). Annual incentive financial goals and results are based on non-GAAP financial measures. See Appendix B on page 104 for definitions of the financial metrics referenced in this chart.

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PROXY SUMMARY | EXECUTIVE COMPENSATION OVERVIEW

COMPENSATION DESIGN FOR 2022 AND BEYOND

Throughout the course of 2021, the Committee has continued to evaluate the design of the legacy companies’ plans and programs and has made important modifications, as detailed below. We expect, however, that full integration of our programs will take multiple years, and some NEOs will continue to participate in legacy company programs until the integration is complete.

What we changed		Why we changed it
LONG-TERM INCENTIVES
We increased the role of Stock Appreciation Rights (“SARs”) and eliminated Restricted Stock Units (“RSUs”) for our senior executives. Beginning with the 2022 grants, LTI awards for our most senior leaders are composed solely of Performance Share Units (60%), and SARs (40%). For our 2021 grants, the mix had included 20% SARs, 20% RSUs, and 60% Performance Share Units (“PSUs”).		The Committee believes that for our most senior executives, SARs are a stronger pay-for-performance vehicle than RSUs because SARs have no value if the stock price does not increase from the price on the grant date. Further, the Committee believes that the 10-year term of SARs motivates prudent long-term decision-making.
LTI MIX
We reverted back to a more standard PSU design for 2022. 2021 PSU design: Due to the pandemic, we replaced our usual three-year PSU goals with one-year EPS and ROIC goals followed by a two-year, time-based vesting period. To balance these one-year EPS and ROIC goals, we also increased the weighting of our 3-year relative TSR metrics from 30% to 50%.		The economic environment caused by the COVID-19 pandemic made setting long-term financial performance goals in early 2021 challenging, especially given the pandemic’s impact on both the aerospace industry and commercial aviation.
PSU WEIGHTINGS
2022 PSU design: We returned to three-year goals for both our EPS and ROIC metrics and a 30% weighting for our relative TSR metrics, with EPS and ROIC each weighted at 35%. This PSU weighting is consistent with the PSU design at legacy UTC before the pandemic and the 2020 Merger of UTC and Raytheon Company (“RTN”).		As we have seen the uncertainty of the COVID-19 pandemic subside over the course of 2021, the Committee determined that for the 2022 PSUs we should return to three-year financial performance goals and our prior metric weightings, thus ensuring that our PSUs align with our long-term strategic plan.

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PROXY SUMMARY | FOCUS ON ESG

What we changed		Why we changed it
RETIREMENT PLANS AND PERQUISITES
We set a timetable for integrating the legacy UTC and RTN defined contribution and deferred compensation plans. Beginning in 2023, all RTX employees will be eligible to participate in the same defined contribution and deferred compensation plans, regardless of their legacy company.		As we continue the integration of two world-class companies following the Merger, we believe we must continue to deliver highly competitive retirement benefits to our employees to ensure we continue to recruit and retain the best talent.
We are harmonizing and modernizing our executive perquisites. We announced a re-design of our executive perquisites, including a phase-out of the legacy UTC executive leased vehicle program and the legacy RTN excess liability insurance, and closure of legacy RTN’s split dollar life insurance policies to new participants.   Starting in 2022, perquisites for RTX executives will be limited to enhanced basic life and long-term disability insurance, an executive physical and a financial planning allowance. Our CEO has three additional benefits for security purposes: use of corporate aircraft, company-provided car and driver and home security monitoring. In exceptional circumstances, other NEOs may use the aircraft for purposes that may have a personal element. See page 61 for additional details.		Our approach to executive perquisites reflects the Committee’s belief that the continued health and financial well-being of our senior leaders is of vital interest to the Company and our shareowners.

Focus on ESG

We view environmental, social, and governance (“ESG”) as integral to our long-term strategy, our business operations, our values and how we engage with our stakeholders.

After the Merger, we embarked on a significant effort to integrate and build upon the ESG approaches of our legacy companies and enhance transparency. By the end of 2021:

●	We released our 2021 Diversity, Equity & Inclusion (“DE&I”) Report, in which we provide workforce diversity data, (including our EEO-1 data) and explain how we are working to drive progress through our pillars of action: public policy, workforce diversity, community engagement and supplier diversity.
●	We formed a Global Diversity, Equity & Inclusion Advisory Board, whereby leaders across RTX will come together to support equality of opportunity, inspire action and drive accountability for our DE&I efforts.
●	We issued our first sustainability performance disclosures against the Sustainability Accounting Standards Board (“SASB”) reporting framework to promote greater transparency and comparability across the aerospace and defense industry.
●	We responded to the Carbon Disclosure Project’s (“CDP”) annual climate change questionnaire, which addresses many of the disclosure elements set by the Task Force on Climate-Related Financial Disclosure established by the G20.
●	We added a Corporate Responsibility Scorecard to our annual incentive plan to drive management accountability and focus.
●	We launched our new social responsibility initiative, ConnectUp, where we will invest $500 million over 10 years to advance equitable opportunities in STEM education, career development and community well-being.

We are proud of these accomplishments but realize we have much more to do. To further drive our ESG performance and enhance transparency, during 2021 we also engaged in a comprehensive ESG prioritization assessment to identify and prioritize ESG topics that are most important to our stakeholders and to achieving our business objectives. Through this effort, we developed our ESG vision and strategy, as well as an ESG roadmap with significant initiatives relating to goal setting and disclosure. We will provide more detail on our ESG strategy and goals in our first annual ESG Report that we plan to issue in the second quarter of 2022.

		Best Companies for Environmental, Social and Governance
		Institutional Investor Magazine—All-American Executive Team

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PROXY SUMMARY | GOVERNANCE AND BOARD OVERVIEW

Governance and Board Overview

BOARD NOMINEES

								Skills and Expertise
				Director Since*		Other Public Boards		Financial		Government		International		Experience in Industry		Risk Management/ Oversight		Senior Leadership		Technology and Innovation
		TRACY A. ATKINSON Retired Executive Vice President & Chief Administrative Officer, State Street Corporation		2020 (2014)		2
		BERNARD A. HARRIS, JR. Chief Executive Officer and Managing Partner Vesalius Ventures, Inc.		2021		1
		GREGORY J. HAYES Chairman & Chief Executive Officer, Raytheon Technologies Corporation		2014		0
		GEORGE R. OLIVER Chairman & Chief Executive Officer, Johnson Controls International plc		2020 (2013)		1
		ROBERT K. (KELLY) ORTBERG Retired Chairman, President & Chief Executive Officer, Rockwell Collins, Inc.		2020		1
		MARGARET L. O’SULLIVAN Professor, Harvard University Kennedy School		2017		0
		DINESH C. PALIWAL Partner, Americas Private Equity, KKR and Retired Chairman & CEO, Harman International		2020 (2016)		1
		ELLEN M. PAWLIKOWSKI General U.S. Air Force (Retired) and Former Commander, Air Force Materiel Command		2020 (2018)		1
		DENISE L. RAMOS Retired Chief Executive Officer & President, ITT Inc.		2018		2
		FREDRIC G. REYNOLDS Retired Executive Vice President & Chief Financial Officer, CBS Corporation		2016		2
		BRIAN C. ROGERS Retired Chairman, T. Rowe Price Group, Inc.		2016		1
		JAMES A. WINNEFELD, JR. Admiral U.S. Navy (Retired) and Former Vice Chairman of the Joint Chiefs of Staff		2020 (2017)		1
		ROBERT O. WORK Retired Deputy Secretary of Defense, U.S. Department of Defense		2020 (2017)		0

*	For the former Raytheon Company (RTN) directors who became members of the Company’s Board of Directors upon the Merger closing on April 3, 2020, the start of their service as RTN directors is shown in parentheses.

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PROXY SUMMARY | GOVERNANCE AND BOARD OVERVIEW

NOMINEE HIGHLIGHTS

The Board believes that the individuals nominated for election at the Annual Meeting have the appropriate attributes, experiences and perspectives to guide the Company and provide effective oversight of our strategy and business plans. As a group, they embody a broad and diverse set of qualifications, skills, and experience, and represent the perspectives of both long-serving directors and those who joined the Board more recently.

These nominees also reflect the director refreshment efforts of both legacy company boards before the Merger, the significant changes to the Board in connection with the Merger, and the changes in Board composition since the Merger.

TENURE ON RTX BOARD
		When legacy RTN board service is included, the average tenure of our nominees is 5 years. ●  More than 5 years—7 nominees ●  3–5 years—4 nominees ●  Less than 3 years—2 nominees

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PROXY SUMMARY | GOVERNANCE AND BOARD OVERVIEW

BOARD ENGAGEMENT IN 2021

In 2021, our Board actively engaged with management on a range of matters, providing strong oversight and invaluable guidance to enable the Company to navigate through a challenging operating environment and to execute on the key priorities that underpin our business strategy.

100%		9		99%		100%
overall attendance by directors at the eight Board meetings during 2021		number of special Board and committee meetings in 2021		overall attendance by directors at Board and committee meetings in 2021		overall attendance by directors at the 2021 Annual Meeting

Board engagement in oversight of:		Other notable Board actions:
●   Development of an ESG strategy and vision, as well as an ESG roadmap with significant initiatives relating to goal setting and disclosure ●   Company risk management, with a particular focus on cybersecurity, product safety and compliance risks ●   The Company’s shareowner engagement efforts ●   The Company's response to the COVID-19 pandemic		●   Set a strong tone at the top and promoted a culture of integrity and accountability ●   Demonstrated its commitment to strong corporate governance and responsiveness to shareowners with the inclusion of a new two-step proposal to repeal the sole supermajority voting provision in the Company’s charter ●   Engaged in CEO and senior management succession planning

GOVERNANCE BEST PRACTICES

Our Board has adopted robust governance practices and continuously reviews and considers these practices to enhance its effectiveness.

Effective independent Board oversight		Board accountability and commitment to shareowner rights
●   11 out of 13 director nominees are independent ●   Qualified Board with diverse mix of perspectives and tenures ●   Robust independent Lead Director role with clear responsibilities ●   Independent directors meet regularly without management ●   Fully independent Audit, Human Capital & Compensation and Governance Committees ●   Regular Board review of strategic plans and priorities ●   Regular Board/committee review of significant risks, including cybersecurity risks ●   Annual Board evaluation of CEO performance ●   CEO and senior management succession planning ●   Limits on outside public company board service ●   Ongoing consideration of Board composition and refreshment		●   Active and ongoing shareowner engagement ●   Annual Board, committee and individual director evaluations ●   Proxy access with market terms ●   Shareowners can act by written consent ●   Shareowners holding 15% of voting stock can call special meetings ●   Annual election of all directors ●   Majority voting for directors in uncontested elections ●   Robust Clawback Policy ●   No hedging, short sales or pledging of RTX securities ●   Rigorous share ownership requirements for directors and senior management

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Proposal 1: Election of Directors

What am I voting on?

We are seeking your support for the election of the thirteen individuals nominated to serve on the Board of Directors until the 2023 Annual Meeting of Shareowners. We believe these nominees have the right experiences and perspectives to guide the Company and provide effective oversight of our strategy and our business plans. They are well qualified to serve as directors of a large aerospace and defense company that competes in government and commercial markets worldwide.

Criteria for Board Membership

The Board and the Committee on Governance and Public Policy (the “Governance Committee”) believe that there are general attributes all directors must exhibit, in addition to key skills and expertise that should be represented on the Board as a whole, but not necessarily by each director.

THESE GENERAL ATTRIBUTES ARE ESSENTIAL FOR ALL DIRECTORS

●	Objectivity and independence in making informed business decisions
●	Extensive knowledge, experience and judgment
●	Highest integrity
●	Diversity of perspective
●	Willingness to devote the extensive time necessary to fulfill a director’s duties
●	Appreciation for the role of a corporation in society
●	Loyalty to the interests of RTX and its shareowners

The Governance Committee recognizes the value of selecting directors who come from various backgrounds and professions and are diverse in age, gender, race and ethnicity, to ensure that the Board as a whole has a wealth of experiences and perspectives to inform its decisions. We believe diversity makes our business stronger and more innovative, and is critical to the Company’s long-term success. For more information about diversity on our Board, see "Nominee Highlights" on page 9 and "Board Composition and Refreshment" on page 13.

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PROPOSAL 1: ELECTION OF DIRECTORS | CRITERIA FOR BOARD MEMBERSHIP

In addition, certain skills and expertise are important for effective oversight of the Company’s businesses and strategy and should be represented on the Board as a whole.

Each director brings particular strengths to the Board. The charts below show the percentage of directors with skills and expertise in each key area. In the nominee biographies on pages 14-21, we highlight for each individual the three key skills and areas of expertise upon which the Board particularly relies.

KEY SKILLS AND EXPERTISE

		Senior Leadership Extensive leadership experience with a significant enterprise, resulting in a practical understanding of organizations, processes and strategic planning, along with demonstrated strengths in developing talent, succession planning, and driving change and long-term growth.				International Experience conducting business or operations outside of the United States or working on international policy and related issues, resulting in international business, political and cultural perspectives and insights that are invaluable to a global company with operations and sales around the world.
		Experience in Industry Experience in the aerospace and defense markets in which RTX operates, whether acquired through service as a senior leader of an organization in those markets or as a government or military customer.				Technology and Innovation Background in or experience leading organizations focused on research and development, engineering, science, software, cybersecurity or technology, which would benefit the Company as a leader in the development of advanced technologies and innovative solutions.
		Financial Leadership of a financial firm or management of an enterprise’s finance function or similar responsibility, resulting in proficiency in complex financial management, financial reporting processes, capital allocation, capital markets, and mergers and acquisitions—representing the importance we place on accurate financial reporting and robust financial controls and compliance.				Government Service in senior government or military roles, which provide constructive insights about how significant government policies and regulations, as well as public policy issues, may affect our Company and how to respond effectively to those matters.
		Risk Management/Oversight Experience in, and knowledge and understanding of, managing major risk exposures for complex, large organizations, including significant financial, operational, compliance, reputational, strategic, international, political and cybersecurity risks, which are critical to the Board’s important risk oversight role.

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PROPOSAL 1: ELECTION OF DIRECTORS | BOARD COMPOSITION AND REFRESHMENT

Board Composition and Refreshment

The Board believes that it benefits from a mix of new directors who bring fresh perspectives and longer-serving directors who bring valuable experience, continuity and a deep understanding of the Company. The Board strives to maintain an appropriate balance of tenure, turnover, diversity, attributes, viewpoints and experiences.

Under the terms of the Merger, seven RTN continuing directors became RTX Board members, joining eight UTC continuing directors. Additionally, our Board was required to maintain a specified composition of directors from both legacy companies until April 3, 2022. Since the Merger, one RTN continuing director and one UTC continuing director left the Board, and Bernard A. Harris, Jr. joined the Board. Marshall O. Larsen, a longer-tenured UTC continuing director, will retire from the Board at the 2022 Annual Meeting.

Given the director refreshment efforts of both legacy company boards before the Merger, the significant changes to the Board in connection with the Merger, and the changes in Board composition since the Merger, our Board believes that our current directors represent the right mix of newer and longer-serving directors, and that they have the appropriate attributes, experiences and perspectives to guide the Company and provide effective oversight of our strategy and business plans.

TENURE ON RTX BOARD
		When legacy RTN board service is included, the average tenure of our nominees is 5 years. ● More than 5 years—7 nominees ● 3–5 years—4 nominees ● Less than 3 years—2 nominees

As a result, while the Board plans to remove the Merger-related composition requirements from our Corporate Governance Guidelines and Bylaws following the 2022 Annual Meeting, it does not plan to make any significant changes to its current membership. The Board may, however, add a new member on an opportunistic basis if it identifies a candidate who is particularly well positioned to enhance Board effectiveness.

The Board will continue to promote refreshment by:

●	regularly reviewing the key skills and expertise that are most important in selecting candidates to serve as directors, taking into account the Company’s operations and the mix of capabilities and experience already represented on the Board and regularly considering individual director tenure and succession; and
●	using its self-evaluation process, including individual director evaluations, to inform its decisions about nomination and refreshment (see page 23 for more detail on the annual self-evaluation process).

Our Corporate Governance Guidelines require that directors retire at the first annual meeting after they reach age 72, unless the Board makes an exception in light of special circumstances.

Our Corporate Governance Guidelines and Bylaws do not impose term limits on directors. In accordance with our Corporate Governance Guidelines, the Governance Committee periodically reviews the tenure of our directors, especially those who have served for 15 or more years. No director nominee has a tenure greater than 8 years.

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PROPOSAL 1: ELECTION OF DIRECTORS | HOW CANDIDATES ARE IDENTIFIED

How Candidates Are Identified

In furtherance of its focus on director refreshment and Board composition, the Board strives to regularly identify potential director candidates who can bring unique perspectives, additional capabilities and experiences, and enhance Board performance. The Board has delegated the identification and evaluation process for director candidates to the Governance Committee. Potential directors can be brought to the Committee's attention in different ways, as shown below. The Committee screens and evaluates all candidates, regardless of who recommends them, using the criteria described under “Criteria for Board Membership” on page 11.

To ensure that there is a large and diverse pool of potential directors, the Governance Committee may engage search firms to assist it in finding qualified and interested candidates and verifying their credentials.

Any shareowner may recommend a director candidate by writing to the RTX Corporate Secretary (see page 97 for contact information).

Current Board members who become aware of suitable candidates may recommend them to the Governance Committee from time to time.

Nominees

The Board, upon the recommendation of the Governance Committee, has nominated for election the thirteen individuals listed in this Proxy Statement. All are current directors of RTX. One of our current directors, Marshall O. Larsen, will be retiring from the Board at the Annual Meeting and is not a nominee for election. We thank Mr. Larsen for his dedicated service and numerous contributions to RTX.

The Board of Directors unanimously recommends a vote FOR each of the following nominees:

Tracy A. Atkinson
INDEPENDENT DIRECTOR Retired Executive Vice President & Chief Administrative Officer, State Street Corporation     Key Skills and Expertise		AGE 57 DIRECTOR SINCE 2020 (2014*) BOARD COMMITTEES Human Capital & Compensation (Chair), Audit, Finance
FINANCIAL    SENIOR LEADERSHIP    RISK MANAGEMENT/OVERSIGHT

 

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PROPOSAL 1: ELECTION OF DIRECTORS | NOMINEES

Bernard A. Harris, Jr.
INDEPENDENT DIRECTOR Chief Executive Officer and Managing Partner, Vesalius Ventures, Inc. Key Skills and Expertise	AGE 65 DIRECTOR SINCE 2021 BOARD COMMITTEES Audit, Special Activities

 

Gregory J. Hayes
Chairman & Chief Executive Officer, Raytheon Technologies Corporation Key Skills and Expertise	AGE 61 DIRECTOR SINCE 2014 BOARD COMMITTEES Finance, Special Activities

 

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PROPOSAL 1: ELECTION OF DIRECTORS | NOMINEES

George R. Oliver
INDEPENDENT DIRECTOR Chairman & Chief Executive Officer, Johnson Controls International plc Key Skills and Expertise	AGE 61 DIRECTOR SINCE 2020 (2013*) BOARD COMMITTEES Governance and Public Policy, Finance

 

 

Robert K. (Kelly) Ortberg
Retired Chairman, President & Chief Executive Officer, Rockwell Collins, Inc. Key Skills and Expertise	AGE 61 DIRECTOR SINCE 2020 BOARD COMMITTEES Finance, Special Activities

 

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PROPOSAL 1: ELECTION OF DIRECTORS | NOMINEES

Margaret L. O’Sullivan
INDEPENDENT DIRECTOR Professor, Harvard University Kennedy School Key Skills and Expertise	AGE 52 DIRECTOR SINCE 2017 BOARD COMMITTEES Governance and Public Policy, Special Activities

 

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PROPOSAL 1: ELECTION OF DIRECTORS | NOMINEES

Dinesh C. Paliwal
INDEPENDENT LEAD DIRECTOR Partner, Americas Private Equity, KKR Retired Chairman & CEO, Harman International Key Skills and Expertise	AGE 64 DIRECTOR SINCE 2020 (2016*) BOARD COMMITTEES Governance and Public Policy, Human Capital & Compensation

 

Ellen M. Pawlikowski
INDEPENDENT DIRECTOR General, U.S. Air Force (Retired) and Former Commander, Air Force Materiel Command Key Skills and Expertise	AGE 65 DIRECTOR SINCE 2020 (2018*) BOARD COMMITTEES Audit, Special Activities

 

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PROPOSAL 1: ELECTION OF DIRECTORS | NOMINEES

Denise L. Ramos
INDEPENDENT DIRECTOR Retired Chief Executive Officer & President, ITT Inc. Key Skills and Expertise	AGE 65 DIRECTOR SINCE 2018 BOARD COMMITTEES Audit, Human Capital & Compensation

 

 

Fredric G. Reynolds
INDEPENDENT DIRECTOR Retired Executive Vice President & Chief Financial Officer, CBS Corporation Key Skills and Expertise	AGE 71 DIRECTOR SINCE 2016 BOARD COMMITTEES Audit (Chair), Governance and Public Policy, Human Capital & Compensation

 

 

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PROPOSAL 1: ELECTION OF DIRECTORS | NOMINEES

 

Brian C. Rogers
INDEPENDENT DIRECTOR Retired Chairman, T. Rowe Price Group, Inc. Key Skills and Expertise	AGE 66 DIRECTOR SINCE 2016 BOARD COMMITTEES Finance (Chair), Human Capital & Compensation

 

 

James A. Winnefeld, Jr.
INDEPENDENT DIRECTOR Admiral, U.S. Navy (Retired) and Former Vice Chairman of the Joint Chiefs of Staff       Key Skills and Expertise	AGE 65 DIRECTOR SINCE 2020 (2017*) BOARD COMMITTEES Special Activities (Chair), Human Capital & Compensation, Finance

 

 

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PROPOSAL 1: ELECTION OF DIRECTORS | NOMINEES

Robert O. Work
INDEPENDENT DIRECTOR Retired Deputy Secretary of Defense, U.S. Department of Defense   Key Skills and Expertise	AGE 69 DIRECTOR SINCE 2020 (2017*) BOARD COMMITTEES Governance and Public Policy (Chair), Audit, Special Activities

 

 

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Corporate Governance

Our Continuing Commitment to Sound Corporate Governance

RTX is committed to strong corporate governance practices that are designed to maintain high standards of oversight, accountability, integrity and ethics and that go beyond legal and regulatory requirements. The Board believes this commitment promotes long-term shareowner value.

CODE OF CONDUCT AND CORPORATE GOVERNANCE GUIDELINES

This commitment to sound governance is reflected in our Code of Conduct and Corporate Governance Guidelines, which reinforce our values and high standards.

Code of Conduct		Corporate Governance Guidelines
●  Explains how our values of Trust, Respect, Accountability, Collaboration and Innovation must inform our actions. ●  Guides employees’ conduct with each other, our business partners and our communities. ●  Emphasizes the responsibility to conduct our business with integrity, to respect and protect human rights, and to report violations of the Code without fear of retaliation.		Governs the structure and functioning of the Board and incorporates numerous leading practices that reflect our high governance standards, including: ●  A clear approval process for outside directorships or paid consulting/advisory engagements that could potentially raise conflicts of interest or detract from a director’s focus on Board duties. ●  Regular review of director tenure in light of the Board’s evolving needs. ●  Annual self-evaluation of the performance of the Board, its standing committees and our directors (see page 23).

We encourage you to visit the Corporate Governance section of our website (www.rtx.com) for more information about corporate governance at RTX.

Board Leadership Structure

Under the terms of the Merger, we established an Executive Chairman and Chief Executive Officer leadership structure which was designed to provide the most effective leadership of the newly formed company for a transitional period of up to two years following the Merger. In light of the Company’s significant progress in its integration efforts in the first year after the Merger, Thomas A. Kennedy retired as Executive Chairman in June 2021, at which time the Board appointed Mr. Hayes to serve as Chairman of the Board in addition to CEO.

The Board believes the interests of all shareowners are best served at this time through the current combined Chairman and CEO leadership structure. It provides the appropriate balance between an empowered independent Lead Director with well-defined responsibilities and a Chairman and CEO with responsibilities for day-to-day management, Board leadership and setting long-term strategy.

The Governance Committee regularly reviews our board leadership structure. Under our Corporate Governance Guidelines, the Board does not have a set policy on whether a CEO may also serve as Chairman of the Board. Instead, the Board selects the structure that it believes will provide the most effective leadership and oversight for the Company in the circumstances. In making this decision, the Board considers a range of factors, including: the Company’s operating and financial performance; any recent or anticipated changes in the CEO role; the effectiveness of the processes and structures for Board interaction with and oversight of management; and the importance of maintaining a single voice in leadership communications and Board oversight, both internally and with investors and customers.

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CORPORATE GOVERNANCE | BOARD SELF-EVALUATION

LEAD DIRECTOR

The Board has designated Mr. Paliwal to serve as the Lead Director.

Our Corporate Governance Guidelines set forth the roles and responsibilities of the Lead Director, which are designed to promote strong, independent oversight of RTX’s management and affairs. Among these roles and responsibilities, the Lead Director:

●  May call and preside over private sessions of the independent directors ●  Serves as Chairman of the Board when the Chairman is not present ●  Engages with significant constituencies, as requested ●  Collaborates with the CEO to plan and set the agenda for Board meetings ●  Oversees the performance evaluation and compensation for our CEO		●  Facilitates succession planning and management development ●  Works with the Chair of the Governance Committee to lead the Board’s annual self-evaluation process and review any director’s request to accept a new outside directorship or other paid engagement per the Corporate Governance Guidelines ●  Authorizes retention of outside advisors and consultants who report to the Board on board-wide issues

RTX’s independent directors meet in private sessions without management. These sessions are held on a regular schedule, and the Lead Director may call extra sessions as needed.

Board Self-Evaluation

The Board believes that robust and constructive self-evaluation is an essential element of good corporate governance, Board effectiveness and continuous improvement. To this end, the Board annually evaluates its own performance and the performance of the standing committees and each individual director.

OVERVIEW OF THE SELF-EVALUATION PROCESS

Oversight and leadership				How it works
The Governance Committee is responsible for, designs and oversees the annual self-evaluation process.		The Lead Director and the Governance Committee Chair jointly lead the self- evaluation process.		Each independent director confers with the Lead Director or the Chair of the Governance Committee to provide feedback, including candid assessment of peer contributions and performance.		The Lead Director and the Chair of the Governance Committee then provide to the full Board a summary of the results of the self-evaluation process, and facilitate a Board discussion about potential areas of improvement and actions that might be taken.

How it contributes to Board performance
The self-evaluation informs the Board’s consideration of: ●  Board roles ●  Board effectiveness and priorities ●  Committee performance ●  Refreshment objectives, including composition and diversity ●  Director succession planning		It has generated improvements to our corporate governance practices and the Board’s effectiveness, including: ●  Allocating more time to private sessions of the independent directors ●  Restructuring the standing committees and their responsibilities in order to free up additional time at Board meetings for strategy and other discussions ●  Improving the Board’s self-evaluation process itself

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CORPORATE GOVERNANCE | BOARD COMMITTEES

In the 2021 self-evaluation process, the Board focused on:

●  The Board’s approach to its oversight of product safety and potential enhancements and clarifications to that approach, including the confirmation of the Governance Committee’s primary oversight role as well as the Special Activities Committee’s role in support of the Governance Committee relating to classified products; ●  The Board’s review and consideration of CEO and senior management succession planning; and ●  Potential changes to the Board’s committees, with the expected removal of the Merger-related committee composition requirements from our Corporate Governance Guidelines and Bylaws following the 2022 Annual Meeting.

Board Committees

Our Board currently has the following standing committees: the Audit Committee, the Committee on Governance and Public Policy, the Finance Committee, the Human Capital & Compensation Committee, and the Special Activities Committee. Under the terms of the Merger, our Board was required to maintain a specified composition of committee members and chairs until April 3, 2022. The Board plans to remove these requirements from our Corporate Governance Guidelines and Bylaws following the 2022 Annual Meeting, and then will consider whether to make any changes to committee composition or chairs.

The Audit, Governance and Public Policy, and Human Capital & Compensation Committees are each composed exclusively of independent directors. Our CEO and our former Special Advisor to the Office of the CEO serve on the Finance and Special Activities Committees (which are not required committees under New York Stock Exchange (“NYSE”) or Securities and Exchange Commission (“SEC”) rules), because the Board believes these individuals bring particular insights on topics within these committees’ responsibilities. Each standing committee has the authority to retain independent advisors, to approve the fees paid to those advisors, and to terminate their engagements.

Each committee operates under a charter that it reviews annually. These charters are available on the Corporate Governance section of our website (www.rtx.com).

In 2021, the Board amended the charters of the Governance and Public Policy Committee and the Human Capital & Compensation Committee to clarify and enhance those committees’ oversight responsibilities for certain ESG topics that are among the most important to RTX. Specifically, the Board:

●  Renamed the Human Capital & Compensation Committee (formerly called the Compensation Committee) to reflect its oversight of human capital management, and expanded the Committee’s responsibilities to include oversight of recruiting, retention, career development, DE&I, and other aspects of human capital management. ●  Confirmed the Committee on Governance and Public Policy’s oversight responsibilities with respect to ESG topics such as sustainability, workplace safety, human rights, and elements of DE&I other than human capital management.

Additionally, in connection with its consideration of RTX’s enterprise risk management program and its risk oversight role, the Board amended the charter of the Governance Committee in February 2022 to confirm the Committee’s oversight responsibility for Company product safety risks (with the Special Activities Committee assisting on classified product safety).

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CORPORATE GOVERNANCE | BOARD COMMITTEES

		Audit Fredric G. Reynolds Chair
2021 MEETINGS: 12 COMMITTEE MEMBERS Tracy A. Atkinson Bernard A. Harris, Jr. Ellen M. Pawlikowski Denise L. Ramos Robert O. Work		●  Assists the Board in overseeing: the integrity of RTX’s financial statements; the independence, qualifications and performance of RTX’s internal and external auditors; the Company’s compliance with its policies and procedures, internal controls, Code of Conduct, and applicable laws and regulations; and policies and procedures relating to risk assessment and management ●  Nominates (for shareowner approval) an accounting firm to serve as RTX’s independent auditor and maintains responsibility for compensation, retention and oversight of the auditor ●  Pre-approves all auditing services and permitted non-audit services to be performed for RTX by its independent auditor ●  Reviews and approves the appointment and replacement of the senior Internal Audit executive The Board has determined that Mr. Reynolds, Ms. Atkinson and Ms. Ramos each are “audit committee financial experts,” as that term is defined in the SEC rules.

		Governance and Public Policy Robert O. Work Chair
2021 MEETINGS: 5 COMMITTEE MEMBERS Marshall O. Larsen George R. Oliver Margaret L. O’Sullivan Dinesh C. Paliwal Fredric G. Reynolds		●  Reviews and oversees RTX’s positions on significant public issues and corporate social responsibility, including sustainability, product and workplace safety, human rights, and elements of DE&I that do not fall under human capital management ●  Develops and recommends modifications to our Corporate Governance Guidelines ●  Identifies and recommends qualified candidates for election to the Board ●  Makes recommendations to the Board for committee assignments ●  Reviews and monitors the orientation of new Board members and the continuing education of all directors ●  Oversees the design and conduct of the annual self-evaluation of the Board, its committees and individual directors ●  Recommends to the Board appropriate compensation of non-employee directors

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CORPORATE GOVERNANCE | BOARD COMMITTEES

		Finance Brian C. Rogers Chair
2021 MEETINGS: 6 COMMITTEE MEMBERS Tracy A. Atkinson Gregory J. Hayes Marshall O. Larsen George R. Oliver Robert K. Ortberg James A. Winnefeld, Jr.		●  Reviews and monitors the management of RTX’s financial resources and financial risks ●  Considers plans for significant acquisitions and divestitures ●  Monitors progress on pending and completed acquisitions and divestitures ●  Reviews significant financing programs in support of business objectives ●  Reviews significant capital appropriations ●  Reviews policies and programs related to: dividends and share repurchases; financing, working and long-term capital requirements; managing foreign exchange exposure, interest rates and raw material prices; investment of pension assets; and insurance and risk management

		Human Capital & Compensation Tracy A. Atkinson Chair
2021 MEETINGS: 5 COMMITTEE MEMBERS Dinesh C. Paliwal Denise L. Ramos Fredric G. Reynolds Brian C. Rogers James A. Winnefeld, Jr.		●  Reviews RTX’s executive compensation policies and practices to ensure that they adequately and appropriately align executive and shareowner interests ●  Reviews and approves the design of, and sets performance goals for, the annual and long-term incentive programs for executives ●  Evaluates the performance of RTX, the business units and the NEOs relative to the performance goals set by the Committee for the annual and long-term incentive programs ●  Reviews and approves compensation for the CEO and other executive officers of the Company ●  Reviews a risk assessment of RTX’s compensation policies, plans and practices ●  Reviews the Company’s initiatives relating to recruiting, retention, career development, DE&I, and other aspects of human capital management

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CORPORATE GOVERNANCE | DIRECTOR INDEPENDENCE

		Special Activities James A. Winnefeld, Jr. Chair
2021 MEETINGS: 6 COMMITTEE MEMBERS Bernard A. Harris, Jr. Gregory J. Hayes Robert K. Ortberg Margaret L. O’Sullivan Ellen M. Pawlikowski Robert O. Work		●  Reviews and monitors activities involving classified business of RTX ●  Reviews policies, processes and internal controls applicable to classified business ●  Reviews RTX’s cybersecurity risk exposure and management’s efforts to manage that exposure ●  Assists other committees of the Board with their activities and oversight related to product safety risk and development of technical talent ●  Monitors critical technology gaps and reviews the investments, talent development and other efforts by management to address those gaps

Director Independence

Under RTX’s Director Independence Policy and the NYSE listing standards, a majority of our directors must be independent, meaning that they do not have a direct or indirect material relationship with RTX (other than as a director). The Director Independence Policy guides the independence determination and defines certain categories of relationships that the Board has determined not to be material relationships that would impair a director’s independence. The policy is available on the Corporate Governance section of our website (www.rtx.com).

Before joining the Board and each year thereafter, each director or nominee completes a questionnaire about relationships and transactions that may require disclosure, may affect the independence determination for that individual, or may affect our ability to meet the heightened independence standards for members of the Audit and Human Capital & Compensation Committees. The Governance Committee’s assessment of independence considers all known relevant facts and circumstances about the relationships bearing on the independence of a director or nominee. The assessment also considers sales and purchases of products and services, in the ordinary course of business, between RTX (including its subsidiaries) and other companies or charitable organizations where a director or a nominee (or immediate family members) may have relationships pertinent to the independence determination.

In accordance with the Director Independence Policy and the NYSE listing standards, the Board has determined that, other than Mr. Hayes (who is a current employee of RTX) and Mr. Ortberg (who is a former employee of RTX), none of the nominees for election at the 2022 Annual Meeting has, directly or indirectly, a material relationship with RTX, or any direct or indirect material interest in any transaction involving RTX. Other than Messrs. Hayes and Ortberg, each nominee satisfies our independence criteria.

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CORPORATE GOVERNANCE | THE BOARD’S ROLE

The Board’s Role

Our Board provides active and independent oversight and guidance to management regarding the Company’s long-term strategy and priorities, risk management, CEO and senior management succession planning and ESG, as well as other aspects of our business and affairs. Further, the Board has adopted robust governance practices to enhance its effectiveness and is engaged on behalf of our shareowners.

As part of its oversight role, the Board annually reviews the Company’s long-term plan and objectives and those of its four business units and engages in periodic discussions of strategic matters, including significant business portfolio transformation transactions. It also receives regular updates on management’s progress and execution of the Company’s strategy and reviews and approves the Company’s annual operating plan.

In 2021, our Board worked closely with management to provide effective oversight of management’s execution on key priorities that underpin our business strategy, including our COVID-19 pandemic response, our focus on operational excellence, our strategic investments in technology and innovation, the management of our business portfolio, and the advancement of our ESG commitments. The Board and its committees also provided strong oversight in other important areas as discussed below.

RISK MANAGEMENT OVERSIGHT

The following is a summary of the current allocation of general risk oversight functions between management and the Board:

Management		Board of Directors
Responsible for identifying, assessing, prioritizing, and managing the various risks that the Company faces		Responsible for Board/committee risk oversight governance, including allocation of risk oversight responsibilities
● Employs a comprehensive enterprise risk management (“ERM”) program ● Maintains robust internal processes and an effective internal control environment		● Audit Committee oversees management’s ERM program ● Board has allocated responsibilities to itself and its committees for overseeing particular risks, as shown below

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CORPORATE GOVERNANCE | THE BOARD’S ROLE

The Board’s risk oversight governance framework is designed to enable it to understand critical risks in the Company’s business and strategy, allocate responsibilities for risk oversight among the full Board and its committees, evaluate the Company’s risk management processes and whether they are functioning adequately, and engage in regular communications regarding risk trends and developments with management.

The Company operates an ERM program that conforms to the Enterprise Risk—Management Integrated Framework established by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) and covers the full range of significant risks to RTX, including legal, compliance, financial, operational, strategic and reputational risks. The Company also maintains robust internal processes and an effective internal control environment that facilitate the identification and management of risks and regular communication with the Board. This includes reporting to the Board by the Chief Financial Officer and General Counsel at least annually on the Company’s most significant risks under its ERM program and the associated mitigation plans. Management also regularly reviews significant risks, including trends and developments, with the Board and its committees, providing updates through annual long-range planning and strategic reviews, regular reviews of annual operating plans, financial performance, market environment updates, and presentations on specific risks.

Cybersecurity Risk Oversight

Given the nature of our business, management is highly focused on identifying and managing a broad range of cybersecurity risks. These risks include those relating to RTX internal systems as well as to RTX products, services and programs for customers. Our Special Activities Committee has primary oversight responsibility for cybersecurity risks, and is regularly briefed by management on cybersecurity risks relating to the Company’s information and operational technology systems, suppliers and partners, as well as our products and services. The full Board also is briefed by management on the Company’s cybersecurity program.

Product Safety Risk Oversight

Management fosters a strong safety culture and maintains robust safety programs across our businesses. Product safety is covered by our ERM program, and the Board has also provided direct oversight over product safety incidents and issues. In connection with its consideration of the ERM program and its risk oversight role, the Board recently amended the charter of the Governance Committee to confirm the Committee’s oversight responsibility for Company product safety risks (with the Special Activities Committee assisting on classified product safety). The Company has established processes for regular reviews with the Governance Committee on product safety matters, including incident metrics and managed safety issues, as well as for immediate reporting in the event of certain significant product safety incidents.

Compensation Risk Oversight

The Human Capital & Compensation Committee believes that executive compensation payouts must:

●	align with the Company’s financial performance;
●	be earned in a manner consistent with RTX’s Code of Conduct;
●	promote long-term, sustainable value for shareowners;
●	provide fair and equitable pay regardless of race and gender; and
●	strike a balance between appropriate levels of financial opportunity and risk.

Through RTX’s ERM framework, the Committee identifies, monitors and mitigates compensation risk in the following ways:

Sound Incentive Plan Design		Our annual and long-term incentive plans use complementary performance metrics that are essential indicators of the financial health of our Company. The Committee establishes financial performance goals that are challenging, yet realistic, and maintains the ability to use its discretion to adjust payouts under our annual incentive plan, to the extent it believes the calculated results do not accurately reflect the overall quality of performance for the year. Further, payouts for both annual incentive awards and PSUs are capped at 200% of target.
Emphasis on Long-Term Performance		Long-term incentives are the cornerstone of RTX’s executive compensation program. Our LTI program incorporates long-term financial performance metrics that are designed to align executive interests with shareowner interests.
Rigorous Share Ownership Requirements		RTX maintains significant share ownership requirements for our senior executives and directors. These requirements are intended to reduce risk by aligning the economic interests of executives and directors with those of our shareowners. A significant stake in future performance discourages the pursuit of short-term opportunities that can create excessive risk. See page 35 for more information.

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CORPORATE GOVERNANCE | THE BOARD’S ROLE

Prohibition on Short Sales, Pledging and Hedging of RTX Securities		RTX prohibits directors, officers and employees from entering into transactions involving short sales of our securities. Directors and executive officers are also prohibited from pledging or assigning RTX stock, stock options or other equity interests as collateral for a loan. Transactions in put options, call options or other derivative securities that have the effect of hedging the value of RTX securities also are prohibited, whether or not those securities were granted to or held, directly or indirectly, by a director, officer or employee.
Clawback Policy		RTX maintains a comprehensive policy on recoupment of both annual and long-term incentive compensation (see page 64 for more details). The policy allows RTX to clawback compensation in a number of circumstances, including financial restatements, compensation earned as a result of financial miscalculations, violations of RTX’s Code of Conduct, and violations of post-employment restrictive covenants.
Post-Employment Covenants		Members of the Company’s Executive Leadership Group (“ELG”), which includes each of our current NEOs, may not engage in post-employment activities detrimental to RTX, such as disclosing proprietary information, soliciting RTX employees or engaging in competitive activities (see page 64).

SUCCESSION PLANNING OVERSIGHT

The Board has primary responsibility for CEO and senior management succession planning and has been particularly focused on senior leadership succession planning in connection with and following the Merger. The Chairman & CEO and the Executive Vice President & Chief Human Resources Officer regularly brief the Board on succession planning for key senior leadership roles, including the CEO role. The Board’s views are incorporated into succession plans, which are updated annually based on this feedback. Succession plans include readiness assessments, biographical information and career development plans.

ESG INITIATIVES AND BOARD OVERSIGHT

As one of the world’s most advanced aerospace and defense systems providers, we are driven to create a safer and more connected world. We are committed to solving society’s toughest challenges by investing in our people, embracing their diverse skills and perspectives to advance sustainable technology, leading in environmental performance and product safety, and building resiliency for our industry, our communities and our planet. We understand that to continue operating at the highest levels of performance, we must create significant value for our people, our investors and our communities. We approach ESG performance through this multi-stakeholder lens.

This commitment starts at the top of our organization with our CEO, who is ultimately responsible for our ESG strategy and performance, and our Board of Directors who oversee our ESG efforts. In 2021, we conducted a comprehensive ESG prioritization assessment. We sought to understand the ESG issues that are most relevant to our stakeholders and our business by engaging with more than 50 internal and external stakeholders representing our employees, our customers, our communities, our investors, our regulators, our industry groups and our businesses. We used this feedback to establish our ESG strategy, which focuses on three critical areas:

	People			Planet			Principles
Bringing together our talented, diverse workforce in an inclusive and innovative environment so that they can achieve their full potential and create a positive impact on society, including the communities where we live and work.			Innovating new technologies and advancing our operations to help our customers, suppliers and communities reach their climate and sustainability goals and positively impact the world around us.			Operating our global business with integrity and a long-term mindset to deliver on our promises by living our values of trust, respect, accountability, collaboration and innovation.

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CORPORATE GOVERNANCE | SHAREOWNER ENGAGEMENT AND RESPONSIVENESS

With the Board’s engagement, we also developed an ESG roadmap with a focus on goal setting and disclosure. In the second quarter of 2022, we will be publishing our first ESG Report. This report will outline the progress we made in 2021 toward our three focus areas, in addition to our future aspirations.

In furtherance of this commitment and to drive accountability across the organization, the Human Capital & Compensation Committee approved the addition of a Corporate Responsibility Scorecard to our Executive Annual Incentive Plan—incentivizing leaders across the Company to strategically work toward our ESG priorities. See pages 48-51 for details.

In addition, given the importance of ESG to our values and strategy and the initiatives underway, during 2021 the Board considered its oversight of ESG, and amended the charters of the Governance Committee and the Human Capital & Compensation Committee to clarify and enhance oversight responsibility for certain ESG topics. The Governance Committee has primary oversight responsibility for several important ESG topics, including sustainability, health and safety and human rights and the Human Capital & Compensation Committee now has oversight for the Company’s human capital function, including employee diversity, equity and inclusion. In addition, the Audit Committee and the Special Activities Committee also regularly review ESG topics for which they have responsibility.

Shareowner Engagement and Responsiveness

The Board and management believe in transparent and open communication with investors. Over the years, these engagements have improved our corporate governance practices, increased shareowner rights, enhanced the Board’s composition, and improved the design and disclosure of our executive compensation program.

We regularly communicate with our investors throughout the year, including through calls, one-on-one and small group meetings, our Investor Day event and other conferences and events. We also engage with our investors in the spring after our Proxy Statement is filed, as well as outside of proxy season, typically in the late summer and fall, when we solicit feedback on our executive compensation program, ESG initiatives, and corporate governance practices.

OUR SHAREOWNER ENGAGEMENT IN 2021

When		Who		Topics		Objectives				Outcome
Summer and fall of 2021		Institutional investors representing 49% of our shares		● ESG vision/strategy formulation ● ESG accomplishments in the last year ● Specific ESG areas, such as energy and greenhouse gas emissions, human rights, DE&I and sustainable technology/innovation		● Enhance investor understanding of our ESG journey, including our areas of focus and our roadmap for increased transparency and accountability				● Incorporated feedback into our ESG roadmap, as well as the content of our first annual RTX ESG Report (scheduled to be published in the second quarter of 2022)
				● Charter supermajority voting provision		● Obtain feedback on charter supermajority voting provision				● Developed a two-step approach to repeal supermajority voting provision and recommended shareowner approval of the first step (see Proposal 4 on pages 90-91)
				● Key elements of 2021 executive compensation program ● Potential enhancements to 2022 program		● Enhance investor understanding of, and obtain feedback on, our executive compensation program				● Provided feedback to Human Capital & Compensation Committee

	In 2021, we engaged with institutional investors holding RTX Common Stock representing over 49% of our shares outstanding on ESG and compensation matters.

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CORPORATE GOVERNANCE | PUBLIC POLICY ENGAGEMENT

PROPOSAL TO MODERNIZE CHARTER

As part of our ongoing efforts to be responsive to shareowner feedback and ensure RTX has sound corporate governance practices, at the 2022 Annual Meeting, we are asking shareowners to approve an amendment to Article Ninth of our Restated Certificate of Incorporation. Article Ninth is the only provision in RTX’s governing documents that requires a shareowner supermajority vote. If that amendment is approved, we would then ask our shareowners to repeal Article Ninth in its entirety at the 2023 Annual Meeting. This two-step approach reflects the Board’s commitment to strong governance and accountability to shareowners and the Governance Committee’s careful consideration of recent shareowner feedback. The Board believes this two-step approach is more likely to result in the ultimate elimination of the supermajority voting provision than prior Company proposals, given historic and anticipated future turnout. To read the full proposal, see pages 90-91.

Public Policy Engagement

RTX’s government relations initiatives are intended to educate and inform officials and the public on a broad range of public policy issues that are important to our businesses. These initiatives are based on the Company’s interests and needs—not based on the personal agendas of individual directors, officers or employees—and are conducted in accordance with our Code of Conduct. We also have in place a Government Relations Policy relating to lobbying, political activities and contributions that is intended to promote compliance with all relevant federal, state and/or local laws, as well as our own governance processes and procedures.

The Board directly or through the Governance Committee provides oversight of the Company’s government relations activities, including activities of the Employees of Raytheon Technologies Corporation Political Action Committee (“RAYPAC”), which was formed through the combination of the employee political action committees of UTC and RTN. RAYPAC is nonpartisan and supports candidates for federal, state and local office and the national political organizations of both major parties—thus giving employees, regardless of their political affiliations, a way to speak with a unified voice on issues important to RTX. RAYPAC considers several criteria before approving a contribution to a candidate, including a determination that the candidate demonstrates a commitment to RTX’s core values of trust, respect, accountability, and collaboration. RAYPAC does not give to candidates who are under Ethics or Department of Justice investigation. RAYPAC operates in accordance with all applicable laws and regulations, and its contributions are reflected in public filings with the Federal Election Commission.

RTX does not contribute to candidates for federal, state and local office or to state and local party committees. We also do not make contributions to initiatives that expressly advocate the election or defeat of a federal, state and local candidate, nor do we provide funding to support or oppose ballot measures.

We publicly disclose our federal lobbying activities and expenditures through reports we file with Congress. RTX’s state lobbying activities are limited and involve issues such as certain business activities, economic development and regulatory matters.

In the ordinary course of business, RTX also contributes to non-profit trade associations that help us stay abreast of technical issues, emerging industry standards, and other trends relevant to our business, and that also engage in public advocacy and education on behalf of their membership.

Additional information on RTX’s public activities, including links to our Code of Conduct, the Government Relations Policy, PAC filings, lobbying reports and association payments (including the portions, if any, used for lobbying) can be found on our website at www.rtx.com under the heading “Our Company/Corporate Governance/Public Activities.”

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Compensation of Directors

Pay Structure

ANNUAL RETAINER

Under the terms of the Raytheon Technologies Corporation Board of Directors Deferred Stock Unit Plan (“RTX Director DSU Plan”), annual retainers for non-employee directors are payable 40% in cash and 60% in deferred stock units (“DSUs”). Directors, however, may elect to receive 100% of the annual retainer in DSUs. The annual retainer paid to non-employee directors for the April 2021 to April 2022 Board cycle is dependent upon the role each director holds, as follows:

Role		Cash ($)		Deferred Stock Units ($)		Total Annual Retainer ($)
All Directors (base retainer)		$124,000		$186,000		$310,000
Additional Compensation for Services as*:
Lead Director		$32,000		$48,000		$80,000
Audit Committee Chair		$16,000		$24,000		$40,000
Audit Committee Member		$12,000		$18,000		$30,000
Human Capital & Compensation Committee Chair		$10,000		$15,000		$25,000
Finance Committee Chair		$10,000		$15,000		$25,000
Governance and Public Policy Committee Chair		$10,000		$15,000		$25,000
Special Activities Committee Chair		$10,000		$15,000		$25,000

*	Directors serving in multiple leadership roles receive incremental compensation for each role.

Annual retainers are paid each year following the Annual Meeting. New directors joining the Board between the Annual Meeting and the end of September receive 100% of the annual retainer. Non-employee directors joining the Board between the beginning of October and the next Annual Meeting receive 50% of the annual retainer. DSUs are 100% vested at the time of grant, but distribution does not occur until after a non-employee director retires from the Board (see “Plan Distributions” on page 34).

Non-employee directors do not receive additional compensation for attending Board or committee meetings, other than special meeting fees. In 2021, directors received an additional $5,000 cash payment for attending each in-person, telephonic or video special meeting to which they were invited. In 2021, payments were made for one special Board meeting, two special Finance Committee meetings, one special Governance Committee meeting and five special Audit Committee meetings.

Starting in 2022, directors will instead receive $3,000 for special, in-person meetings. The special meeting fee will apply only to a formal Board or committee meeting that was not on the Board’s annual calendar, and does not take place during a regularly scheduled Board meeting.

DEFERRED RESTRICTED STOCK UNITS

Directors appointed to the Board before October 2019 received a one-time deferred RSU award. This award vests in equal portions over five years but is not distributed until a director retires from the Board. Non-employee directors appointed after October 2019 did not receive the deferred RSU award upon joining the Board.

DIVIDEND TREATMENT

When RTX pays a dividend on Common Stock to shareowners, directors are credited with additional DSUs and deferred RSUs equal in value to the dividend paid on the corresponding number of shares of RTX Common Stock.

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COMPENSATION OF DIRECTORS | 2021 DIRECTOR COMPENSATION

PLAN DISTRIBUTIONS

DSUs and deferred RSUs are not distributed to directors until they retire from the Board. Upon retirement, RTX DSUs and deferred RSUs are converted into shares of RTX Common Stock. For our legacy UTC directors, upon the 2020 spinoff of Carrier and Otis, vested DSUs and deferred RSUs originally based in UTC stock were converted into vested DSUs and deferred RSUs in the stock of RTX, Carrier and Otis. For these directors, when they retire from the RTX Board, the Carrier and Otis DSUs and deferred RSUs (if any) will be distributed in cash. Directors can elect to receive distributions in either a lump-sum or in 10- or 15-year installments.

2021 Director Compensation

Name		Fees Earned or Paid in Cash ($)(1)		Stock Awards ($)(2)		All Other Compensation ($)(3)		Total ($)
Tracy A. Atkinson		$186,000		$219,000		$26,387		$431,387
Bernard A. Harris, Jr.		$146,000		$204,000		$1,387		$351,387
Marshall O. Larsen		$144,000		$186,000		$1,387		$331,387
George R. Oliver		$139,000		$186,000		$26,387		$351,387
Robert Kelly Ortberg(4)		$139,000		$186,000		$1,387		$326,387
Margaret L. O’Sullivan		$134,000		$186,000		$1,387		$321,387
Dinesh C. Paliwal		$35,000		$390,000		$26,387		$451,387
Ellen M. Pawlikowski		$166,000		$204,000		$11,222		$381,222
Denise L. Ramos		$30,000		$340,000		$1,222		$371,222
Fredric G. Reynolds		$175,000		$210,000		$26,387		$411,387
Brian C. Rogers		$15,000		$335,000		$26,387		$376,387
James A. Winnefeld, Jr.		$15,000		$335,000		$6,387		$356,387
Robert O. Work		$35,000		$365,000		$11,387		$411,387

(1)	Reflects the portion of the directors’ annual retainer, as well as special meeting fees, paid in cash. Messrs. Paliwal, Rogers, Winnefeld, Jr., and Work, and Ms. Ramos elected to receive their annual cash retainer in DSUs, as detailed in footnote (2).
(2)	Reflects the grant date fair value of DSU awards credited to the director’s account, including any portion of the annual cash retainer that the director elected to receive as DSUs. The value of DSU awards is calculated in accordance with FASB ASC Topic 718 using assumptions described in Note 21: Stock Based Compensation, to the Consolidated Financial Statements in RTX’s 2021 Annual Report on Form 10-K. The number of units credited to each director in 2021 was calculated by dividing the value of the award by $81.00, the NYSE closing price per share of RTX Common Stock on April 26, 2021, which was the date of the 2021 Annual Meeting. Since DSU awards vest on the grant date, but are not distributed until the director retires from the Board, the only unvested units as of December 31, 2021, are the following unvested portions of the deferred RSU awards received by those directors who joined the Board before October 2019: Dr. O’Sullivan (267 units); and Ms. Ramos (532 units). The aggregate number of shares underlying awards outstanding for each director can be found in the table on page 35.
(3)	Amounts in this column include incidental benefits and matching contributions to eligible non-profit organizations under the Company’s matching charitable gift program that covers non-employee directors as well as Company employees. The Company’s matching charitable gifts in 2021 were as follows: Ms. Atkinson, $25,000; Mr. Oliver, $25,000; Mr. Paliwal, $25,000; Ms. Pawlikowski, $10,000; Mr. Reynolds, $25,000; Mr. Rogers, $25,000; Mr. Winnefeld, Jr., $5,000 and Mr. Work, $10,000.
(4)	Mr. Ortberg served as an executive officer, but not as a named executive officer, between January 1, 2021 and February 28, 2021. For additional details on his compensation earned during 2021 as an executive officer, see the Transactions with Related Persons disclosure on page 100.

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Share Ownership

Share Ownership Requirements

Our rigorous share ownership requirements, shown below, promote and strengthen the alignment of our non-employee directors and senior management with the interests of our shareowners.

6X		5X		4X		3X		2X
base salary for our Chairman & CEO		annual base cash retainer for non-employee directors		base salary for our CFO, COO and business unit presidents		base salary for other ELG members		base salary for other officers*

Shares for the purposes of determining compliance with the RTX Share Ownership Policy are defined as RTX Common Stock held outright (by the executive/director or their spouse), restricted stock units, restricted stock awards, shares or share equivalents held in a Company savings plan or deferred compensation plan. Stock options, stock appreciation rights, and performance share units are excluded from the definition of shares under the RTX Share Ownership Policy.

Non-employee directors must achieve their required ownership level within five years of joining the Board, and ELG members (including the NEOs) must achieve their ownership levels within five years of appointment to the ELG. Other officers who are not ELG members must achieve their ownership levels within five years of appointment to an officer role. An individual who has not reached the applicable ownership level after this five-year period is not permitted to sell RTX shares until that ownership level is achieved. All directors, ELG members and other officers currently comply with their respective ownership requirements or are on track to meet them within the five-year period.

*	Other officers who are not ELG members.

Beneficial Share Ownership of Directors and Executive Officers

The following table shows the beneficial ownership of RTX Common Stock as of February 10, 2022 for: (i) each director and nominee; (ii) each NEO; and (iii) the directors and executive officers as a group. None of these individuals or the group as a whole beneficially owned more than 1% of RTX Common Stock as of that date. Unless otherwise noted, each person named in the table has sole voting power and sole investment power.

Name of Beneficial Owner		SARs Exercisable within 60 days(1)		RSUs Convertible to Shares within 60 days(2)		DSUs Convertible to Shares within 60 days(3)		Total Shares Beneficially Owned(4)
Each director and nominee for director, including CEO
T. Atkinson		-		-		6,037		18,257
B. Harris, Jr.		-		-		2,564		2,564
G. Hayes		283,536		-		-		697,351	(5)
M. Larsen		-		1,344		21,888		28,664	(6)
G. Oliver		-		-		5,091		21,357
R. Ortberg		69,919		-		2,338		216,299
M. O’Sullivan		-		1,043		9,231		10,274
D. Paliwal		-		-		10,779		31,355	(6)
E. Pawlikowski		-		-		5,607		8,806
D. Ramos		-		1,115		12,793		13,908
F. Reynolds		-		1,138		13,028		36,391
B. Rogers		-		1,138		20,376		26,514	(6)
J. Winnefeld, Jr.		-		-		9,202		16,702
R. Work		-		-		7,873		12,842

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SHARE OWNERSHIP | CERTAIN BENEFICIAL OWNERS

Name of Beneficial Owner		SARs Exercisable within 60 days(1)		RSUs Convertible to Shares within 60 days(2)		DSUs Convertible to Shares within 60 days(3)		Total Shares Beneficially Owned(4)
CFO and other NEOs who are not also directors
N. Mitchill, Jr.		21,288		-		-		51,881
M. Dumais		73,634		-		-		147,894	(6)
S. Timm		1,830		-		-		8,417
C. Calio		26,498		-		-		71,437
T. Kennedy		-		55,175		-		296,472	(7)
A. O’Brien III		-		-		-		14,181
All directors, nominees and executive officers as a group (24 in total)(8)								1,665,619

(1)	Net number of shares of RTX Common Stock that would be issued to the executive officers if their vested SARs were exercised within 60 days of February 10, 2022. Once vested, each SAR can be exercised for the number of shares of RTX Common Stock having a value equal to the difference between the market price on the exercise date and the exercise price of the SAR. The estimated net number of shares of RTX Common Stock was calculated using $95.06 per share, which was the NYSE closing price of RTX Common Stock on February 10, 2022.
(2)	Non-employee director deferred RSUs vest in equal portions over five years and are distributed in shares of RTX Common Stock when the director retires from the Board. The table reflects the vested portion of the RSUs, which are the number of shares in which the director or nominee has the right to acquire beneficial ownership at any time within 60 days of February 10, 2022, following the director’s retirement from the Board.
(3)	Previously accrued portion of the non-employee director’s annual retainer earned in DSUs, which are vested on the grant date but are not converted into RTX Common Stock and distributed until retirement. The table reflects the number of shares in which the director or nominee has the right to acquire beneficial ownership at any time within 60 days of February 10, 2022, following the director’s retirement from the Board.
(4)	Reflects holdings by directors and officers of all shares beneficially owned (including unvested shares of restricted stock) and awards convertible to shares within 60 days of February 10, 2022.
(5)	Includes shares for which a spouse holds sole voting and investment power: G. Hayes (3,579 shares).
(6)	Includes shares for which voting and investment power is jointly held by the director or NEO: M. Larsen (5,432 shares); D. Paliwal (20,576 shares); B. Rogers (5,000 shares); and M. Dumais (7,301 shares).
(7)	Includes 55,175 shares vesting in the next 60 days pursuant to restricted stock unit awards granted under the legacy RTN 2019 and 2010 Stock Plans to retirement-eligible employees who have attained the age of 60 with at least ten years of service with the Company (and from which shares will be withheld to satisfy taxes upon vesting).
(8)	Holdings, as of February 10, 2022, of the directors and executive officers who are listed in the Company’s 2021 Annual Report on Form 10-K.

Certain Beneficial Owners

The following table shows all holders known to RTX to be beneficial owners of more than 5% of the outstanding shares of RTX Common Stock as of December 31, 2021.

Name and Address		Shares		Percent of Class
State Street Corporation(1) State Street Financial Center One Lincoln Street Boston, MA 02111		137,843,993		9.2%
The Vanguard Group(2) 100 Vanguard Boulevard Malvern, PA 19355		118,463,846		7.9%
BlackRock, Inc.(3) 55 East 52nd Street New York, NY 10055		98,553,635		6.6%

(1)	State Street Corporation reported in a joint SEC filing that, as of December 31, 2021, it beneficially owned in the aggregate 137,843,993 shares of RTX Common Stock, and held sole voting power with respect to zero shares of RTX Common Stock, shared voting power with respect to 112,740,725 shares of RTX Common Stock, sole dispositive power with respect to zero shares of RTX Common Stock and shared dispositive power with respect to 137,832,336 shares of RTX Common Stock. In the same joint SEC filing, State Street Global Advisors Trust Company, a subsidiary of State Street Corporation, reported that, as of December 31, 2021, it beneficially owned 115,081,711 shares of RTX Common Stock and held sole voting power with respect to zero shares of RTX Common Stock, shared voting power with respect to 32,567,397 shares of RTX Common Stock, sole dispositive power with respect to zero shares of RTX Common Stock and shared dispositive power with respect to 115,077,631 shares of RTX Common Stock.
(2)	The Vanguard Group reported in an SEC filing that, as of December 31, 2021, it held sole voting power with respect to zero shares of RTX Common Stock, shared voting power with respect to 2,215,637 shares of RTX Common Stock, sole dispositive power with respect to 112,556,517 shares of RTX Common Stock and shared dispositive power with respect to 5,907,329 shares of RTX Common Stock.
(3)	BlackRock, Inc. reported in an SEC filing that, as of December 31, 2021, it held sole power to vote or to direct the vote of 88,718,435 shares of RTX Common Stock and sole power to dispose or direct the disposition of 98,553,635 shares of RTX Common Stock.

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Proposal 2: Advisory Vote to Approve Executive Compensation

What am I voting on?	Each year we ask shareowners to approve, on an advisory basis, the compensation of our Named Executive Officers (“NEOs”). Before voting, we encourage you to read and consider the Compensation Discussion and Analysis on pages 39-64, along with the compensation tables on pages 66-84.

How is shareowner feedback considered?

RTX values and considers shareowner views when making executive compensation decisions. Over the years, shareowner input has substantially contributed to the philosophy that underpins the design of our executive compensation program – our Guiding Principles — which are described on page 43 of this Proxy Statement. Each year we engage with investors to solicit their views on our executive compensation programs. The Human Capital & Compensation Committee (the “Committee”) uses this feedback in its evaluation and oversight of our program. Shareowner feedback also is reflected in our ongoing effort to make the compensation information in our proxy statements clearer and more transparent.

Why should I vote for this proposal?

The Committee is committed to designing an executive compensation program that is structured to advance our fundamental objective: aligning our executives’ compensation with the long-term interests of our shareowners.

As the Committee continues to work to fully integrate the executive compensation program of our legacy companies, its primary goal is to design a program that rewards financial and operating performance, effective strategic leadership, and advances our commitment to corporate social responsibility—all key elements in building sustainable shareowner value.

To reinforce these objectives, the Committee has selected performance metrics for our incentive programs that align with shareowner interests by correlating the timing and amount of actual payouts to our short-, medium- and long-term performance.

In addition, compensation opportunities under these programs are structured to:

●	reward the appropriate balance of financial, strategic and operational business results;
●	align executives’ pay with Company performance and the shareowner experience;
●	facilitate the retention of highly talented executives who are critical to our long-term success;
●	deliver fair and equitable pay to executives of comparable experience and performance who perform similar work, regardless of race or gender; and
●	require ethical and responsible conduct in pursuit of these goals.

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PROPOSAL 2: ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION | WHY SHOULD I VOTE FOR THIS PROPOSAL?

Accordingly, the Board recommends that shareowners vote FOR the following resolution:

“RESOLVED, that the compensation of RTX’s NEOs, as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, compensation tables and related information provided in this Proxy Statement, is hereby APPROVED on an advisory basis.”

As a matter of law, the approval or disapproval of this Proposal 2 may not be construed as overruling any decision by RTX or the Board, or as imposing any duty or obligation on RTX, the Board or any individual director.

The Board of Directors unanimously recommends a vote FOR this proposal.

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COMPENSATION DISCUSSION AND ANALYSIS

Compensation Discussion and Analysis

What’s in this section?	In this section, we discuss our compensation philosophy and explain how our executive compensation program is structured to advance our fundamental objective of aligning our executives’ compensation with the long-term interests of RTX shareowners. We also explain how the Human Capital & Compensation Committee of the Board (the “Committee”) determined compensation for our NEOs listed below, as well as the Committee’s rationale for specific 2021 pay decisions.

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COMPENSATION DISCUSSION AND ANALYSIS |  EXECUTIVE SUMMARY

Executive Summary

Shareowner Engagement on Compensation

We actively seek and highly value feedback from our shareowners and their advisors. The Committee annually considers this feedback as part of its ongoing assessment of our program’s effectiveness.

Our 2021 Say-On-Pay Vote Each year, we consider the results of our advisory vote on executive compensation (“say-on-pay”) from the prior year. At our 2021 Annual Meeting of Shareowners, approximately 92% of the votes cast were in favor of the Committee’s 2020 executive compensation decisions. We interpreted this as an endorsement of our compensation program’s design and direction.

OTHER IMPORTANT FEEDBACK
Corporate responsibility metrics			Changes related to the Merger
●	In response to investor feedback over the past few years, we have incorporated a Corporate Responsibility Scorecard (“CRS”) into our Executive Annual Incentive Plan for 2021, to drive management focus and ensure accountability on the Company’s long-term diversity, equity and inclusion, environmental sustainability and safety objectives.		●	During 2021, shareowners have expressed support for the changes made to our executive compensation program in connection with the integration of our legacy companies.
●	Shareowners have given us positive feedback on the design of the scorecard. For additional details on the design of the scorecard, see pages 48-51.

For more information on our shareowner engagement, see pages 31-32.

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COMPENSATION DISCUSSION AND ANALYSIS | EXECUTIVE SUMMARY

2021 Performance Overview

We delivered TSR of 23.3% in 2021, outpacing our Core A&D Peers. We also continued our 85-year tradition of paying a dividend to shareowners, and returned $5.3 billion to investors through a combination of dividends and share repurchases.

We achieved a total of $760 million in gross Merger cost synergies in 2021, and $1 billion since completing the Merger. We also increased our goal of gross run-rate cost synergies within four years of the Merger from $1 billion to $1.5 billion and are on track to exceed that goal.

We ended the year with our commercial aerospace backlog growing by 12% to $93 billon and remain well positioned to deliver on the 2020-2025 organic sales growth, adjusted margin expansion and free cash flow goals that we communicated during our Investor Day in May 2021.

2021 AT A GLANCE
23.3% TSR		7.4% increase
outpaced our Core A&D Peers		in dividend per share(3)
$63 billion		85th consecutive year
defense backlog at year-end		paying a dividend to shareowners
$93 billion		$1 billion
commercial aerospace backlog at year-end		in total gross Merger cost synergies achieved as of year-end
9%		$5.3 billion
aftermarket sales growth at our commercial businesses		returned to investors through dividends and share repurchases

(1)	See Appendix A on pages 102-103 for more information regarding non-GAAP financial measures.
(2)	GAAP cash flow is cash flow from operating activities of continuing operations, while non-GAAP cash flow is free cash flow from continuing operations.
(3)	In the second quarter of 2021, we increased our quarterly dividend from $0.475 per share to $0.51 per share.

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COMPENSATION DISCUSSION AND ANALYSIS |  EXECUTIVE SUMMARY

PROGRESS ON KEY PRIORITIES

We remained laser-focused on our key priorities during 2021, which included:

Enhancing our focus and transparency in ESG

We view ESG as integral to our long-term strategy, our business operations, our values and how we engage with our stakeholders. In 2021, we made meaningful progress driving our ESG strategy and enhancing transparency to ensure we are doing everything possible to positively impact these important societal issues. Our 2021 efforts included:

 

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COMPENSATION DISCUSSION AND ANALYSIS | EXECUTIVE SUMMARY

How We Align Pay and Performance

Our executive compensation program is structured to advance our fundamental objective: aligning our executives’ compensation with the long-term interests of our shareowners. The Committee’s primary goal is to reward and recognize strong financial and operating performance, effective strategic leadership, and advancements in corporate social responsibility, all of which the Committee believes drive long-term, sustainable shareowner value. This pay-for-performance philosophy is embedded into an important set of Guiding Principles that underpin how the Committee has approached the design of our executive compensation program.

OUR GUIDING PRINCIPLES

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COMPENSATION DISCUSSION AND ANALYSIS |  EXECUTIVE SUMMARY

OVERVIEW OF 2021 PAY DECISIONS

2021 Pay Mix

Consistent with our Guiding Principles, the largest portion of compensation for our NEOs in 2021 was “at-risk” compensation—annual and long-term incentive awards that are contingent on Company performance relative to our key metrics and stock price performance. See pages 5, 49 and 52 for details on the metrics we use in our compensation program and why they were chosen.

(1)	Percentages calculated based on 2021 total direct compensation, as shown below.
(2)	Excludes Mr. Dumais since he did not receive an LTI award in 2022 due to his expected transition into a consulting role later in the year.

2021 Total Direct Compensation

In making annual pay decisions, the Committee employs a measure called “total direct compensation,” which includes our three principal elements of executive compensation: base salary, annual and long-term incentives. These elements are discussed in detail on pages 47-53.

Total direct compensation reflects how an executive’s pay relates to the Committee’s assessment of Company, business unit and individual performance for the year. For this reason, 2021 total direct compensation includes the LTI grant values approved by the Committee in February 2022 (which were based on its assessment of 2021 performance) rather than the February 2021 LTI award grant date fair values shown in the Summary Compensation Table on page 66 (which were based on the Committee’s assessment of 2020 performance and the accounting value at the time of grant). For more details on total direct compensation, see page 55.

The following chart shows the 2021 total direct compensation of our NEOs who were employed by the Company at the end of 2021:

		Base Salary ($K)(1)		Annual Incentive ($K)		LTI ($K)(2)		Total Direct Compensation ($K)
Gregory J. Hayes		$1,600		$4,992		$15,250		$21,842
Neil G. Mitchill, Jr.		$800		$1,200		$4,000		$6,000
Michael R. Dumais(3)		$880		$1,200		$0		$2,080
Christopher T. Calio		$750		$1,200		$7,000		$8,950
Stephen J. Timm		$750		$1,200		$5,000		$6,950

(1)	Reflects the base salary in effect for each NEO as of December 31, 2021. Values above differ from those in the Summary Compensation Table on page 66, since they do not reflect the impact of salary adjustments (if any) made during the year and base salary reductions from furloughs at Pratt & Whitney and Collins Aerospace for Messrs. Calio and Timm, respectively.
(2)	Reflects values approved by the Committee for the LTI award granted on February 15, 2022. These values differ from the values that will be reported in the Summary Compensation Table in 2023, which will be calculated in accordance with FASB ASC Topic 718, Compensation—Stock Compensation.
(3)	Mr. Dumais did not receive an LTI award on February 15, 2022, since he will transition into a consulting role later in the year.

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COMPENSATION DISCUSSION AND ANALYSIS | HOW WE MAKE PAY DECISIONS AND ASSESS OUR PROGRAMS

How We Make Pay Decisions and Assess Our Programs

Roles and Responsibilities

 

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS | HOW WE MAKE PAY DECISIONS AND ASSESS OUR PROGRAMS

2021 Independent Consultant Engagement

In early 2021, the Committee again engaged Frederic W. Cook & Co. (“FW Cook”) as the Committee’s independent consultant for the year. Prior to its engagement, the Committee reviewed the firm’s qualifications, independence and any potential conflicts of interest. FW Cook did not perform other services for or receive other fees from the Company. As a result, the Committee determined that FW Cook qualified as an independent consultant. During 2021, FW Cook representatives attended each of the five Committee meetings.

No other consulting firm made recommendations to the Committee on RTX’s peer group composition or on the form, amount or design of executive compensation in 2021. However, the Committee does obtain market data from other compensation consulting firms for benchmarking and other purposes. Generally, such data is also available to other consulting clients of these firms.

Our Compensation Peer Group and Use of Market Data

How We Use Peer Group Data. The Committee believes that to keep our executive compensation program sufficiently competitive, the target value of each principal element of compensation should approximate the market median of the companies RTX views as competitors for senior executive talent. For this reason, we compare our executive compensation program to the programs of companies within our Compensation Peer Group (“CPG”). In addition, we use market data from the aerospace and defense sector, the Fortune 100 and a broader group of companies to gain insight into general compensation trends and to supplement CPG market data when the Committee finds this necessary or appropriate. The Committee annually evaluates each compensation element relative to the market for each officer’s role and makes adjustments as necessary. However, individual compensation may vary from market median benchmarks based on the Committee’s assessment of other factors that it determines to be relevant, including Company, business unit, function and/or individual performance, job scope, retention risk, internal pay equity and tenure.

How Our Compensation Peer Group is Constructed. The CPG’s composition reflects a mix of industry and non-industry peers. The Committee believes the 20 companies that make up the CPG provide a relevant comparison based on their similarity to RTX in size, geographic footprint and operational complexity, taking into account factors such as revenue, market capitalization, global scope of operations, manufacturing footprint, research and development activities, and technology and engineering focus. The CPG is used solely for the purpose of benchmarking executive compensation. As a result, we do not use the relative financial performance of the CPG as a performance metric in our incentive compensation programs.

OUR COMPENSATION PEER GROUP

Aerospace & Defense		Equipment & Machinery		Technology/Communications		Oil & Gas
Boeing		3M		AT&T		Chevron
General Dynamics		Caterpillar		Cisco
L3Harris Technologies		Deere		HP, Inc.
Lockheed Martin				IBM
Northrop Grumman				Intel
				Verizon
Chemicals		Diversified Industrials		Automotive		Freight & Logistics
Dow		General Electric		General Motors		UPS
		Honeywell

 

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COMPENSATION DISCUSSION AND ANALYSIS | 2021 PRINCIPAL ELEMENTS OF COMPENSATION

TIMELINE FOR COMPENSATION DECISIONS

The Committee followed the process shown below in making 2021 annual pay decisions for each principal component of compensation included in 2021 total direct compensation, which includes the 2022 LTI awards. Total direct compensation for each of our NEOs is shown on page 44.

February 2021		April 2021*		December 2021		February 2022		1st Quarter of 2022
Approved 2021 base salary merit adjustments. Approved 2021 annual incentive performance goals.		2021 base salary adjustments took effect.		Reviewed preliminary 2021 Company, business unit and individual NEO performance.		Reviewed final 2021 Company, business unit and individual NEO performance. Approved performance factors and individual payouts for 2021 annual incentive awards. Approved and granted 2022 LTI awards reflective of 2021 performance.		2021 annual incentive awards paid.

* Certain NEOs may have received merit increases in late March due to differences in payroll schedules.

2021 Principal Elements of Compensation

Base Salary

To attract and retain talented and qualified executives, we provide competitive base salaries that are generally targeted at the peer group market median and range above or below based on tenure, experience, sustained performance over time, job scope and responsibilities, retention risk and internal pay equity. Each year, the Committee reviews the CEO’s recommendations for base salary merit adjustments for our officers relative to market data for similar roles. The Committee has complete discretion to modify or approve the CEO’s recommendations, and the CEO is not involved in the Committee’s determination of his own base salary.

Annual Incentive Awards

Annual incentive awards, which are awarded under the Raytheon Technologies Corporation Executive Annual Incentive Plan (“AIP”), are an integral component of our executive compensation program. The AIP reinforces corporate, organizational and business unit goals, promotes the achievement of these goals, and enables us to attract, retain and motivate the highest caliber of executive talent.

HOW ANNUAL INCENTIVE AWARDS ARE DETERMINED

The following formula is the basis for determining annual incentive awards for our NEOs:

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Though performance relative to pre-established financial goals is the primary basis for determining the financial performance factors, the Committee retains the right to make discretionary adjustments to the overall performance factors if it determines such financial performance does not accurately reflect the overall quality of performance for the year. In the past, the Committee has made both positive and negative adjustments. Examples of situations that could result in discretionary adjustments include:

●	Material, unforeseen circumstances beyond management’s control that affected financial performance relative to the established goals, including certain non-recurring charges and credits unrelated to operating performance;
●	Tax or accounting rule changes that positively or negatively impact performance; and
●	Changes to the Company’s capital structure.

Further, our NEOs begin the year with individual financial, strategic and/or operational objectives. Based on the CEO’s assessment of each NEO’s performance, he may recommend that the Committee use its discretion to increase or decrease the annual incentive award calculated using the performance factor approved by the Committee. The Committee considers these recommendations and makes adjustments it deems appropriate, ranging anywhere from -100% to +30% of the approved performance factor.

2021 ANNUAL INCENTIVE TARGETS

Each NEO has an annual incentive target that is expressed as a percentage of the NEO’s base salary as in effect on December 1, 2021. Annual incentive targets are based on relevant market data for each NEO’s role and generally are set to approximate the median of our CPG. Below are the 2021 annual incentive target percentages for each of our NEOs who were employed by the Company as of year-end.

PERFORMANCE METRICS

New Corporate Responsibility Scorecard Since the Merger, we have been engaging in a significant effort to integrate and build upon our legacy companies’ ESG approaches. RTX management and the Board of Directors view ESG as integral to our long-term strategy, our business operations, our values and how we engage with our stakeholders. In line with this continued emphasis on ESG, the Committee incorporated non-financial performance objectives into our Executive Annual Incentive Plan starting in 2021. This was done by adding a Corporate Responsibility Scorecard (“CRS”), which is comprised of two categories—People & Culture and Sustainability & Safety—each weighted at 10%, while our financial metrics—earnings and free cash flow (“FCF”)—are now each weighted at 40%.

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2021 Performance Metrics and Weightings

The charts below show the 2021 performance metrics and weightings for our Corporate and business unit executives.

					Financial Goals				Corporate Responsibility Scorecard Objectives
					Earnings		Free Cash Flow		People & Culture		Sustainability & Safety
Corporate Executives Funding based entirely on Company-wide performance
	Company-Wide
Business Unit Executives Funding based equally on business unit performance and Company-wide performance
	Company-Wide		Business Unit

For our Corporate executives, performance on each metric is measured on a Company-wide basis. At the business unit level, the Committee believes our annual incentive awards should balance the importance of delivering on customer commitments while also leveraging expertise and resources across the Company to advance technology and innovation and to drive progress toward our corporate responsibility goals. As a result, for our business unit executives, performance on each of the four metrics is based equally on business unit results and Company-wide results. In the case of both financial goals and CRS objectives, payout funding ranges from 0% to 200% of target.

OUR FINANCIAL PERFORMANCE METRICS

		Company-Wide Metrics				Business Unit Metrics
		RTX Earnings		RTX FCF		Business Unit Earnings		Business Unit FCF
How are AIP financial metrics defined?		RTX’s net income attributable to common shareowners (as reported in the 2021 Annual Report on Form 10-K), adjusted for restructuring, the impact of acquisitions and divestitures (including acquisition accounting adjustments), and non-recurring and other significant, non-operational items.		Consolidated net cash flow provided by operating activities, less capital expenditures (both as reported in the 2021 Annual Report on Form 10-K), adjusted for restructuring, the impact of acquisitions and divestitures, and non-recurring and other significant, non-operational items.		Business unit operating income (as reported in the 2021 Annual Report on Form 10-K), adjusted for restructuring costs, the impact  of acquisitions and divestitures  (including acquisition accounting adjustments), and non-recurring and other significant, non-operational items.		Internal measure based on business unit net cash flow provided by operating activities, less capital expenditures, adjusted for restructuring, the impact of acquisitions and divestitures, and non-recurring and other significant, non-operational items.
Why did the Committee choose these metrics?		The Committee believes adjusted net income is relevant to assessing RTX’s overall performance because it includes the impact of items such as tax, interest and foreign exchange fluctuations, which are managed at the Corporate level.		The Committee believes that FCF performance is a relevant measure of our ability to generate cash to fund our operations and key business investments and to return capital to our shareowners.		The Committee believes that operating income, exclusive of tax, interest and foreign exchange exposure, should be the focus of our business units.		The Committee believes that FCF performance is a relevant measure of the business units’ ability to generate cash . to fund their operations and key business investments.
Why do we use non- GAAP financial metrics for annual incentives?		The Committee believes annual incentives should not be positively or negatively impacted by short-term decisions made in the best interest of RTX’s long-term business strategies. Our non-GAAP performance measures encourage decision-making that considers long-term value creation but does not conflict with our short-term incentive metrics. Adjustments for restructuring, non-recurring and other significant, non-operational items and for acquisitions and divestitures allow for a clearer assessment of business performance and help to align our annual incentive goals with the non-GAAP financial expectations we communicate to shareowners.

 

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OUR CORPORATE RESPONSIBILITY SCORECARD

RTX is committed to building a company that embraces diversity, equity and inclusion, ensuring our operations do not compromise the environmental health of future generations, and creating a safe workplace for our employees. For us, advancing these commitments are both a business and social imperative that requires our leadership team be held accountable for making tangible progress.

To accelerate the pace of our progress, the Committee incorporated the Corporate Responsibility Scorecard objectives listed below to reinforce the Company’s commitment to our long-term goals and to strengthen alignment between the interests of executives and shareowners.

		People  & Culture				Sustainability  & Safety
		Diversity Representation		Culture of Inclusion		Environmental		Health & Safety
What objectives are in the 2021 Corporate Responsibility Scorecard?		●   Improve representation of women and people of color through external hires, promotions and retention		●   Enhance and increase participation in DE&I programs ●   Drive inclusive culture through DE&I training and Employee Resource Group evolution and sponsorships ●   Develop and move talent across the enterprise		●   Reduce greenhouse gas emissions ●   Reduce waste generation ●   Reduce water usage		●   Reduce enterprise-wide environmental, health and safety risks ●   Reduce ergonomic risk
Are the objectives in the CRS weighted?		The Committee believes the relative importance of the objectives within the CRS will evolve over time, and as such, did not assign specific weightings to these objectives. This will allow the Committee to maintain flexibility in its performance evaluation process.

HOW WE PERFORMED ON OUR 2021 FINANCIAL GOALS

For each financial metric previously described, the Committee established numerical goals for earnings and free cash flow at threshold, target and maximum levels for the Company overall and for each business unit. Performance relative to these goals determines the financial performance factors used to fund the annual incentive pool for Corporate executives and for executives at each business unit.

Performance below the threshold level will result in 0% funding for that metric, while performance above the maximum level cannot exceed the maximum funding level of 200%. Performance that falls between the threshold, target and maximum levels results in funding between the applicable levels.

The below chart shows the 2021 Company-wide financial goals, results and financial performance factors:

Financial Metric		Weight		Threshold (50% funding)		Target (100% funding)		Maximum (200% funding)		2021 Results		Financial Performance Factors
Earnings—net income ($M)		40%		$4,775		$5,600		$6,460		$6,465(1)		200%
Free Cash Flow ($M)		40%		$3,500		$4,500		$6,100		$5,105(2)		138%

(1)

RTX’s adjusted net income was $6,445 million, which was further adjusted for annual incentive purposes to $6,465 million to exclude certain restructuring, non-recurring and other significant, non-operational items, and acquisitions and divestitures (including acquisition accounting adjustments).

 

(2)

RTX’s FCF of $5,008 million was adjusted to $5,105 million for annual incentive purposes to exclude restructuring costs, the impact of acquisitions and divestitures, and non-recurring and other significant, non-operational items.

 

The below chart provides additional details on the 2021 business unit financial goals, results and financial performance factors:

		Business Unit Goals and Results(1)
		Business Unit Earnings		Business Unit FCF
What financial goals were set for annual incentive purposes for 2021?		Adjusted operating income goals ranged from $475 million to $2,050 million for our business units.		FCF goals ranged from $450 million to $1,800 million for our business units.
What financial results were used to determine financial performance factors?		Adjusted business unit operating income ranged from $487 million to $2,004 million.		FCF results used for annual incentive purposes for our business units ranged from $806 million to $1,658 million.
What were the resulting financial performance factors for each financial metric?		Ranged from 89% to 183% of target.		Ranged from 0% to 200% of target.
What were the final financial performance factors once applying the 50% weighting of the Company-wide factors?		Ranged from 145% to 192% of target.		Ranged from 69% to 169% of target.

(1)

See Appendix B on page 104 for details on how we calculate earnings and FCF for the purposes of determining business unit financial performance factors.

 

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HOW WE PERFORMED ON THE CORPORATE RESPONSIBILITY SCORECARD

Throughout the course of the year, the Committee conducted a comprehensive analysis of the Company’s and each business unit’s efforts in driving progress on our CRS objectives. To help the Committee in its assessment, this analysis incorporated both quantitative and qualitative data, including diversity representation progress in 16 different categories, and measured progress toward the Company’s 5-year environmental and safety ambitions.

The Committee also approved CRS performance factors for each of the business units that ranged from 100% to 110% for the People & Culture category and 105% and 115% for the Sustainability & Safety category. With the Company-wide CRS performance factors weighted at 50%, the CRS performance factors for our business units ranged from 100% to 105% for People & Culture and from 108% to 113% for Sustainability & Safety.

HOW PERFORMANCE AFFECTED PAYOUTS

Below are the weighted results for Corporate executives when combining both the financial performance factors and the CRS performance factors, as well as the overall RTX performance factor approved by the Committee.

RTX Metrics	Weight		Unweighted Performance Factor		Weighted Performance Factor
Earnings (net income)	40%		200%		80%
Free Cash Flow	40%		138%		55%
People & Culture	10%		100%		10%
Sustainability & Safety	10%		110%		11%
			Overall RTX Performance Factor		156%

Weighted performance factors for our business units ranged from 106% to 158% of target. The Committee did not apply any discretionary adjustments to the 2021 performance factors for RTX or our business units.

Long-Term Incentive (“LTI”) Awards

The Committee annually reviews the design of our LTI awards to ensure consistency with our program’s fundamental objective of aligning the interests of executives and shareowners, while attracting and retaining talented senior leaders. Our annual LTI awards are subject to three-year, service-based (and in the case of PSUs, performance-based) vesting requirements, with exceptions for death, disability, retirement, change-in-control and certain qualifying involuntary terminations.

COMPOSITION OF 2021 AWARDS
	LTI Awards granted in early 2022 comprised only of PSUs and SARs. See page 53 for additional details on this change.

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COMPENSATION DISCUSSION AND ANALYSIS | 2021 PRINCIPAL ELEMENTS OF COMPENSATION

PERFORMANCE SHARE UNITS (60% OF 2021 LTI MIX)

PSUs vest following the end of the performance period, subject to Company performance relative to four pre-established goals, and if the recipient is still employed by the Company at that time. PSUs are designed to deliver market median compensation at target levels of performance. Below- or above-target performance levels will result in variations from market median payouts. Payouts range from 0%, if all metrics fall below threshold-level performance, to 200% of target, if all metrics meet or exceed the maximum-level performance. Each PSU converts into one share of RTX Common Stock upon vest. Unvested PSUs do not earn dividend equivalents.

Performance Metrics and Goals for the 2021–2023 PSUs. The economic environment caused by the COVID-19 pandemic made setting long-term financial performance goals in early 2021 challenging, especially given its impact on the aerospace industry and the uncertainty around the timing of the expected recovery of commercial aviation. As a result, for our PSUs granted on February 8, 2021, the Committee set one-year Earnings Per Share (“EPS”) and Return on Invested Capital (“ROIC”) goals, followed by a two-year, time-based vesting period. For relative Total Shareowner Return (“TSR”) performance vs. our Core A&D Peers and the companies within the S&P 500 Index, we maintained a three-year performance period. To balance the change to our EPS and ROIC goals, the Committee increased the total portion of our PSUs vesting subject to three-year TSR performance from 30% to 50%.

The Committee believes this change was appropriate to avoid potential compensation windfalls or deficits attributable to the uncertain operating environment. As described on page 53, for 2022, the Committee reverted back to three-year EPS and ROIC performance goals, and to our historical metric weightings.

PERFORMANCE GOALS AND WEIGHTINGS FOR 2021–2023 PSUs

Metric(1)		Weighting		Threshold (25% payout)		Target (100% payout)		Maximum (200% payout)
EPS ● Goal set to align with the expectations we communicated to our investors				$3.00		$3.55		$3.90
ROIC ● Calculated using a quarterly average over the performance period				3.20%		3.70%		4.05%
TSR vs. Core A&D Peers(2) ● RTX’s cumulative three-year TSR percentile rank relative to our nine Core A&D Peers				25th percentile		50th percentile		75th percentile
● Beginning and ending periods are measured using the November/December trailing average
● Payout for this portion of the award is capped at 100% of target if RTX’s TSR is negative
TSR vs. S&P 500 Index Companies ● RTX’s cumulative three-year TSR percentile rank relative to the companies within the S&P 500 Index at the beginning of the performance period				25th percentile		50th percentile		75th percentile
● Beginning and ending periods are measured using the November/December trailing average
● Payout for this portion of the award is capped at 100% of target if RTX’s TSR is negative

(1)	Performance goals are based on non-GAAP financial measures. See Appendix B on page 104 for a definition of how these measures are calculated for PSU purposes.
(2)	Core A&D Peers include: Airbus, Boeing, General Electric, General Dynamics, Honeywell, L3Harris, Lockheed Martin, Northrop Grumman and Safran.

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Limit on Maximum Vesting Value. If the value of PSUs at vesting (valued by multiplying the number of PSUs vesting by the closing RTX stock price on the vest date) is greater than 400% of the value of the PSUs at grant (valued by multiplying the number of PSUs at target-level performance by the closing RTX stock price on the grant date), the vesting factor will be reduced so that the value delivered to our executives will be no greater than 400% of the grant value.

What the Committee Considers when Setting Performance Goals. When setting financial performance goals for our PSU awards, the Committee considers various long-term business factors, including, but not limited to, planned share buybacks, macroeconomic market trends, pension headwinds/tailwinds and cost reduction plans. Certain items such as unplanned share buybacks, restructuring charges, and non-recurring and non-operational items may be excluded from performance results, as appropriate, to maintain the validity of the targets as originally formulated. See Appendix B on page 104 for a definition of how we calculate these metrics.

No PSU Vesting in 2021. We had no PSUs eligible to vest during 2021. Company-wide performance goals for PSUs granted by our legacy companies prior to the Merger were no longer measurable following the Merger. As a result, at the time of the Merger, all outstanding PSUs had performance measured as of the date of the Merger and were then converted into RSUs that remain eligible to vest on the original vest date. We will not have a PSU vesting until early 2024 when our 2021 PSUs become eligible to vest subject to performance through 2023.

STOCK APPRECIATION RIGHTS (20% OF 2021 LTI MIX)

SARs entitle the award recipient to receive, upon exercise, shares of RTX Common Stock with a market value equal to the difference between the market price of RTX Common Stock on the date the SARs are exercised and the exercise price that was set at the grant date (i.e., the closing price of RTX Common Stock on the date of grant). SARs vest and become exercisable three years from the grant date if the recipient is still employed by the Company at that time and expire 10 years from the grant date.

RESTRICTED STOCK UNITS (20% OF 2021 LTI MIX)

RSUs entitle the award recipient to receive shares of RTX Common Stock upon vest. RSUs vest three years from the grant date if the recipient is still employed by the Company at that time. During the vesting period, RSUs earn dividend equivalents that are reinvested as additional RSUs each time the Company pays a dividend to shareowners. These additional RSUs vest on the same date as the underlying RSUs.

HOW DID OUR LONG-TERM INCENTIVE AWARDS CHANGE FOR 2022?

Beginning with the 2022 LTI awards, NEOs received LTI awards as a mix of PSUs and SARs, weighted at 60% and 40%, respectively. The 2022 mix increases the total portion of LTI delivered in SARs from 20% to 40% and eliminates the use of RSUs for our most senior leaders. The Committee believed RSUs were appropriate to support senior executive retention during the years up to and following the Merger, and in light of the uncertainty surrounding the COVID-19 pandemic and its impact on our business and industry. However, as the uncertainty of COVID-19 begins to subside and the Merger integration matures, the Committee believes that for our most senior executives, SARs better support our pay-for-performance philosophy compared to RSUs because SARs have no value if our stock price does not increase above the price on the grant date. The Committee also believes that the 10-year term of SARs motivates prudent long-term decision-making that drives sustainable value creation for shareowners. For the 2022 PSUs, the Committee also reverted to the historic three-year financial performance goals for all metrics, and EPS and ROIC will each be weighted at 35%, with relative TSR weighted at 30% (15% for each peer comparator group).

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COMPENSATION DISCUSSION AND ANALYSIS | 2021 CEO PAY DECISIONS

2021 CEO Pay Decisions

Gregory J. Hayes Chairman & Chief Executive Officer AGE 61 RTX EXPERIENCE 32 YEARS

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COMPENSATION DISCUSSION AND ANALYSIS | 2021 CEO PAY DECISIONS

	What is “total direct compensation?”
	In contrast to the Summary Compensation Table (on page 66), our discussion of CEO and NEO pay decisions in this proxy (pages 54-59) uses a measure called “total direct compensation.” The Committee believes this measure provides a more accurate picture of its annual pay decisions, reflecting its most recent assessment of Company/business unit and individual performance. How the Committee Views LTI Award Values
	Total Direct Compensation		Includes the value of LTI awards approved by the Committee and granted in February 2022.		Award values correctly relate to the Committee’s assessment of 2021 performance.
	Summary Compensation Table		Includes the grant date fair value of LTI awards granted in February 2021.		Award values relate back to the Committee’s assessment of 2020 performance.
	The SEC rules require the LTI awards granted in February 2022 to be reported in the Summary Compensation Table in our 2023 proxy statement, with a different valuation methodology than we use for total direct compensation. In addition, the compensation values reported in the Summary Compensation Table also include certain elements (e.g., changes in pension values, which are impacted by assumptions like interest rates, and other formulaic compensation components) that we exclude from total direct compensation because they are not tied to performance and fall outside the scope of the Committee’s annual pay decisions.

CEO TOTAL DIRECT COMPENSATION: THREE-YEAR COMPARISON

As shown in the chart below, and as discussed in our Guiding Principles on page 43, the Committee believes that a substantial portion of total direct compensation should be variable, contingent and directly linked to Company and individual performance. In 2021, 93% of Mr. Hayes’ total direct compensation was “at-risk” variable compensation.

(1)	Does not reflect the 20% base salary reduction associated with the COVID-19 pandemic for the period between June and December of 2020.
(2)	Reflects annual LTI award values approved by the Committee. These values differ from the values reported in the Summary Compensation Table (on page 66), which are calculated in accordance with FASB ASC Topic 718.

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COMPENSATION DISCUSSION AND ANALYSIS | 2021 PAY DECISIONS FOR OTHER NEOS

2021 Pay Decisions for Other NEOs

The Committee makes annual compensation decisions for our NEOs based on their individual performance and the overall performance of the Company (and the NEO’s business unit/function, where applicable). In the following pages, we describe the components of total direct compensation for each NEO for 2021, noting aspects of their individual performance that contributed to the Committee’s pay decisions (see page 55 for an explanation of total direct compensation).

Neil G. Mitchill, Jr. Executive Vice President & Chief Financial Officer AGE 46 RTX EXPERIENCE 7 YEARS

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COMPENSATION DISCUSSION AND ANALYSIS | 2021 PAY DECISIONS FOR OTHER NEOS

Michael R. Dumais Executive Vice President, Chief Transformation Officer AGE 55 RTX EXPERIENCE 23 YEARS

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COMPENSATION DISCUSSION AND ANALYSIS | 2021 PAY DECISIONS FOR OTHER NEOS

Christopher T. Calio Chief Operating Officer AGE 48 RTX EXPERIENCE 16 YEARS

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COMPENSATION DISCUSSION AND ANALYSIS | 2021 PAY DECISIONS FOR OTHER NEOS

Stephen J. Timm President, Collins Aerospace AGE 53 RTX EXPERIENCE 25 YEARS

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COMPENSATION DISCUSSION AND ANALYSIS | OTHER COMPENSATION ELEMENTS

Other Compensation Elements

Retirement and Deferred Compensation Benefits

Our retirement and deferred compensation plans play an important role within our overall executive compensation program by providing an element of financial security that helps RTX attract and retain talented executives. Over the years, these programs have been modified to maintain a competitive position within an evolving market.

Currently, as a result of the Merger, our NEOs are eligible to participate in the plans of their legacy companies. Further, in some cases, our NEOs were previously employed by a company that was acquired by either legacy UTC or RTN, and may therefore retain balances and/or receive pension accruals under different formulas of these acquired companies’ plans.

DEFINED BENEFIT PLANS

Both legacy companies had qualified and non-qualified defined benefit plans, as described below:

●

The qualified UTC Pension Plan and the non-qualified UTC Pension Preservation Plan were closed to new participants hired prior to January 1, 2010 and were closed for pre-2010 hires on December 31, 2019. Legacy UTC employees no longer accrue pension benefits, other than with respect to interest credits on the cash balance formula of these plans.

●

The qualified RTN Salaried Pension Plan, the qualified RTN Retirement Plan, and the non-qualified RTN Parity Pension Plan were closed to new participants hired on or after January 1, 2007. However, employees hired prior to January 1, 2007, still accrue pension benefits under these plans. In addition, pension benefits are also still accrued for participants of the RTN Supplemental Executive Retirement Plan.

For additional details on each of these plans, refer to the Pension Benefits section on pages 72-75.

DEFINED CONTRIBUTION AND DEFERRED COMPENSATION PLANS

Both legacy companies also maintained the following qualified and non-qualified defined contribution and deferred compensation plans:

●	The qualified UTC Employee Savings Plan, the non-qualified UTC Savings Restoration Plan, UTC Company Automatic Contribution Excess Plan, UTC Deferred Compensation Plan, and the UTC LTIP Performance Share Unit Deferral Plan remain open to legacy UTC employees.
●	The qualified RTN Savings and Investment Plan and the non-qualified RTN Deferred Compensation Plan remain open to legacy RTN employees.

For additional details on each of these plans, refer to the Nonqualified Deferred Compensation section on pages 76-77.

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Perquisites and Other Benefits

We provide our senior executives with certain perquisites and other benefits, which the Committee believes contribute to recruitment and retention and are consistent with market practice. During 2021, the perquisites and other benefits provided to each NEO are dependent on the NEO’s legacy company (UTC or RTN). However, we will integrate these benefits across RTX starting in 2022.

Our approach to executive perquisites is based on the Committee’s belief that the continued health and financial well-being of our senior leaders is of vital interest to the Company and our shareowners. Therefore, starting in 2022, perquisites and other benefits for our NEOs will generally consist of enhanced basic life and long-term disability insurance, an executive physical and a financial planning allowance. Other perquisites provided by our legacy companies will be phased out or in some cases grandfathered. As one of the leading defense contractors to the United States government, we will also continue to provide our CEO with certain additional benefits for his safety and security, including personal use of the Corporate aircraft, company-provided car and drivers (who are trained security personnel), as well as home security monitoring.

STATUS OF PERQUISITES AND BENEFITS*

Continuing
Financial Planning		All NEOs are eligible to receive an annual financial planning allowance. However, the level of their current benefit depends on their legacy company. Starting in 2022, this benefit is capped at an annual cost of $13,500.
Enhanced Basic Life Insurance		Effective January 2022, executives, who do not have a legacy RTN split dollar life insurance policy, will be covered by an enhanced basic life insurance benefit of three times base salary.
Executive Physical		All NEOs are eligible to participate in the same healthcare benefits offered to other employees of their legacy company. However, they are also eligible for a comprehensive annual executive physical, with current benefit levels depending on their legacy company. Starting in 2022, this benefit is capped at an annual cost of $5,000.
ELG Long-Term Disability Insurance		Legacy UTC NEOs are covered by the ELG long-term disability benefit, and beginning January 1, 2022, legacy RTN ELG members will also be eligible for this benefit. This is an annual benefit paid only upon disability, equal to 80% of the sum of the executive’s base salary and target annual incentive award at the time of disability.
Personal Aircraft Usage		RTX’s policy allows our CEO (and Executive Chair, if applicable) to use the corporate aircraft for personal use, though special approval may be given to other executives in extraordinary circumstances. The Committee believes this is essential for our CEO’s security and personal safety, in addition to being a more efficient use of his time.
Company-Provided Car and Driver		For security reasons, our CEO (and Executive Chair, if applicable) has access to a company-provided car and drivers (who are trained security personnel) when needed. This is primarily used for business purposes, but also may be used, in limited circumstances, in situations that may have a personal element.
Security Monitoring		The Company covers the cost of security system monitoring at the personal residence of our CEO (and Executive Chair, if applicable).
Phasing Out
Company Car		Legacy UTC executives receive an annual allowance toward the cost of a leased vehicle and ancillary vehicle benefits. The value of the allowance varies by ELG appointment date. Lease payments above the annual allowance are paid directly by the executive. In 2021, we announced that the legacy UTC leased vehicle benefit would cease at the time the current individual leases expire. We expect this program to be closed in its entirety by mid-2023.
Split Dollar Life Insurance		Legacy RTN provided its senior executives with executive split dollar life insurance policies with benefits up to four times base salary (capped at $3 million during employment). Following retirement, coverage reduces by 12.5% annually for five years and after five years, the benefit equals 100% of final base salary. The benefit will be grandfathered for legacy RTN senior executives with existing policies, but the Company has not entered into additional policies since the Merger and has eliminated this benefit prospectively for new senior leaders.
Excess Liability Insurance		Legacy RTN senior executives receive an excess liability insurance benefit for which premiums are paid by the Company. This insurance benefit will be fully eliminated by April 2022.

*	See footnote (6) of the Summary Compensation Table on page 67 for more details on these perquisites/benefits for 2021.

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COMPENSATION DISCUSSION AND ANALYSIS | OTHER COMPENSATION ELEMENTS

Severance and Change-in-Control Arrangements

MERGER-RELATED SEVERANCE BENEFITS

As a result of the Merger that closed on April 3, 2020, severance benefits provided to our legacy RTN NEOs (Messrs. Kennedy and O’Brien) and our Corporate legacy UTC NEOs (Messrs. Hayes, Dumais, and Mitchill) vary depending upon each NEO’s legacy company. These benefits expire within two years of the Merger, except that Mr. Hayes’ employment agreement expires on the three-year anniversary of the Merger. Details of each NEO’s individual severance and change-in-control arrangements as of year-end can be found on pages 78-84.

EXECUTIVE LEADERSHIP GROUP PROGRAM

While our NEOs, except Messrs. Calio and Timm, are currently covered by fixed-term, Merger-related severance benefits, the Committee has decided to maintain the legacy UTC Executive Leadership Group (“ELG”) program on a go-forward basis. As a result, following the Merger, several legacy RTN senior executives, except for Mr. Kennedy, were appointed to the ELG.

The ELG program currently covers approximately 45 of the Company’s most senior leaders, as well as key executives who are potential successors to senior leadership roles. The program has been in place since 1989 but has been modified a number of times over the years to align with best practices and to serve the evolving needs of the Company.

The current program provides an RSU award, granted to executives upon their appointment to the ELG, that vests only if there is a qualifying separation (defined on page 63), and the executive enters into an agreement containing certain restrictive covenants (explained on page 63).

The RSU award acts as a cash severance replacement tool, which the Committee believes more closely aligns our executives with the interest of our shareowners than an outright cash severance payment.

The changes to the ELG separation benefit over the years have been applied prospectively due to existing contractual commitments. As a result, Messrs. Hayes and Dumais are grandfathered into earlier iterations of the program that included cash severance payments, as shown in the table below. However, Mr. Hayes is not eligible to receive the ELG cash severance during the three-year term of his post-Merger employment agreement (see pages 78-79) and Mr. Dumais is not eligible to receive the ELG cash severance during the two-year term of the UTC Merger Severance Plan for Corporate Office Executives and Other Key Employees (see pages 80-81), in which he is a participant. When these Merger-related severance arrangements expire, both Messrs. Hayes and Dumais will resume eligibility for ELG cash severance benefits.

Upon the Merger, Mr. O’Brien, was appointed to the ELG. However, he separated from the Company prior to becoming eligible for separation benefits under the ELG program, and therefore forfeited his ELG RSU award.

		Date of Executive’s Appointment to the ELG
		Prior to January 2006		Between January 2006 and April 2013		After April 2013
ELG Cash Separation Benefit		2.5x base salary following qualifying separation		2.5x base salary if a qualifying separation occurs prior to age 62		No cash benefit
ELG RSU Award*		No award granted		RSU award with a grant value equal to 2x base salary that vests if a qualifying separation occurs on or after age 62		RSU award with a grant value up to $2 million depending on role, that vests upon a qualifying separation
NEO Participation		Gregory J. Hayes		Michael R. Dumais		Neil G. Mitchill, Jr. Christopher T. Calio Stephen J. Timm Anthony F. O’Brien III

*	ELG RSUs earn dividend equivalents during the vesting period that are reinvested as additional RSUs each time the Company pays a dividend to shareowners. These RSUs are subject to the same vesting conditions as the underlying award.

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COMPENSATION DISCUSSION AND ANALYSIS | OTHER COMPENSATION ELEMENTS

Under the ELG program, a “qualifying separation” is defined as:

●	A mutually agreeable separation from the Company due to an ELG member’s position being eliminated or diminished by a divestiture, restructuring, shift in priorities or similar event following three years of ELG membership;
●	Retirement on or after age 62 following three years of ELG membership; or
●	Involuntary (not for cause) or voluntary (for good reason) terminations within two years of a change-in-control event.

Restrictive covenants that apply to ELG benefits:

●

For all ELG members—regardless of when the executive was appointed to the ELG, separation benefits are conditioned upon enhanced post-employment restrictive covenants designed to protect the Company’s interests, including: (i) non-competition; (ii) employee non-solicitation; (iii) non-disparagement; (iv) protection of confidential, sensitive and proprietary information; and (v) post-termination cooperation.

●

For ELG members appointed on or after April 2013—in addition to the above, a post-employment, non-competition covenant applies, regardless of whether separation benefits are provided.

The ELG separation benefit is not treated as compensation for purposes of determining benefits under the pension plans or any other benefit programs. Distributions are subject to certain restrictions imposed by IRC Section 409A.

RAYTHEON TECHNOLOGIES CORPORATION 2018 LONG-TERM INCENTIVE PLAN

Under the Raytheon Technologies Corporation 2018 Long-Term Incentive Plan, as amended and restated (“RTX LTIP”), should a future RTX change-in-control event occur, upon a participant’s qualifying termination within two years of a change-in-control event, the vesting of outstanding LTI awards granted under the RTX LTIP would accelerate. For performance awards, performance goals would be deemed achieved at the greater of actual or target performance levels.

LEGACY UTC SENIOR EXECUTIVE SEVERANCE PLAN

Change-in-control severance protection under our legacy UTC Senior Executive Severance Plan (“SESP”) was designed to ensure continuity of management in potential change-in-control situations. In response to changing market practices, legacy UTC closed this program to new participants effective June 2009.

Accordingly, Mr. Hayes is the only executive who remains eligible for the SESP benefit. All other ELG members instead are covered by the ELG program in a change-in-control event.

While the Merger of UTC and RTN was executed as a “merger of equals,” as a legal matter, a change-in-control (as defined in the Plan) under the SESP was not triggered. However, should an RTX change-in-control event occur after the three-year term of Mr. Hayes’ employment agreement (as described in detail on pages 78-79), Mr. Hayes would then be eligible to receive a cash severance benefit under the SESP.

The SESP cash severance is equal to 2.99x the sum of base salary and Mr. Hayes’ target annual incentive award for the year in which termination occurs, subject to various restrictive covenants. The SESP benefit would be reduced by 1/36th for each month that termination occurs after age 62 and, accordingly, is completely phased out at age 65. Benefits under the SESP are subject to a “double trigger” where benefits are provided only if a change-in-control is followed by an involuntary termination or termination by the executive for “good reason” within two years following a change-in-control. “Good Reason” generally includes material adverse changes in an executive’s compensation, responsibilities, authority, reporting relationship or work location.

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COMPENSATION DISCUSSION AND ANALYSIS | OTHER EXECUTIVE COMPENSATION POLICIES AND PRACTICES

Other Executive Compensation Policies and Practices

Through RTX’s Enterprise Risk Management framework, the Committee identifies, monitors and mitigates compensation risk in a number of ways that are summarized on pages 29-30, with additional details provided below on our post-employment restrictive covenants, our Clawback Policy, and our prohibition on certain transactions involving RTX stock.

Post-Employment Restrictive Covenants

ELG members may not engage in activities after termination or retirement that are detrimental to RTX, such as disclosing proprietary information, soliciting RTX employees or engaging in competitive activities. Violations can result in a clawback of annual and long-term incentive awards.

Clawback Policy

RTX has a comprehensive policy on recoupment (“clawback”) of compensation, which we have enhanced several times over the years in response to shareowner feedback and to ensure that our policy continues to meet the evolving needs of the Company.

In the event of a financial restatement (whether or not this involves misconduct on the part of the employee) or a recalculation of a financial metric affecting an award, the Company has the right to recover from any employee (including our NEOs) annual incentive payments and gains realized from vested long-term incentive awards.

Clawbacks of annual and long-term incentive awards and compensation realized from prior awards also may be triggered by violations of our Code of Conduct, failure to meet employee health and safety standards, violations of post-employment restrictive covenants or the exposure of RTX to excessive risk as determined under our Enterprise Risk Management program (for details on this program refer to pages 28-29). In addition, the Company has the right to recover compensation when an executive’s negligence (including negligent supervision of a subordinate) causes significant harm to RTX. If required or otherwise appropriate, the Company may publicly disclose the circumstances surrounding the Committee’s decision to seek recoupment. Our Clawback Policy can be found on the Corporate Governance page of our website at www.rtx.com/our-company/corporate-governance#Governance-Documents-and-Policies.

Prohibitions on Certain Transactions Involving RTX Stock

RTX does not allow its directors, officers or executives to enter into short sales of RTX Common Stock. Similarly, directors and executive officers may not pledge or assign an interest in RTX Common Stock or other equity interests as collateral for a loan. Transactions in put options, call options or other derivative securities that have the effect of hedging the value of RTX securities are also prohibited, whether or not those securities were granted to or held, directly or indirectly, by the director, officer or employee. Also, RTX’s LTIP generally prohibits buyouts/repricing of underwater stock options and stock appreciation rights without shareowner approval.

Employment Agreements

As a general matter, the Committee does not believe that fixed-term executive employment contracts guaranteeing minimum levels of compensation over multiple years enhance shareowner value. Accordingly, the vast majority of our U.S.-based executives do not have such contracts. However, in rare cases involving mergers and acquisitions, the Committee has found such contracts to be in the Company’s best interests.

When the Merger agreement between UTC and RTN was signed in 2019, the Company executed limited-duration employment agreements with Messrs. Hayes and Kennedy that became effective upon the Merger in April 2020. These agreements outline the leadership succession plan for RTX following the Merger (as described on pages 78-79). Mr. Kennedy’s agreement terminated with his retirement in June 2021, and Mr. Hayes’ agreement will expire on the third anniversary of the Merger.

We also enter into employment agreements with executives based outside the United States when local regulations and practices require such agreements.

Tax Deductibility of Incentive Compensation

As a general matter, while the Committee considers corporate tax deductibility as one of several relevant factors in determining compensation, it retains the flexibility to design and maintain executive compensation arrangements that it believes will attract and retain executive talent, even if such compensation is not deductible by the Company for federal income tax purposes. For 2021, IRC Section 162(m) limited RTX’s deduction to $1 million for annual compensation paid to our NEOs, as defined in IRC Section 162(m).

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Report of the Human Capital &
Compensation Committee       

 

Human Capital & Compensation Committee
	Tracy A. Atkinson, Chair	Denise L. Ramos	Brian C. Rogers
	Dinesh C. Paliwal	Fredric G. Reynolds	James A. Winnefeld, Jr.

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Compensation Tables

Summary Compensation Table

Year		Salary ($)(1)		Bonus ($)(2)		Stock Awards ($)(3)		Option Awards ($)(4)		Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)(5)		All Other Compensation ($)(6)		Total ($)		Total Without Change in Pension Value ($)
Gregory J. Hayes    Chairman & Chief Executive Officer
2021		$1,600,000		$4,992,000		$11,740,098		$2,815,812		$1,522,891		$645,262		$23,316,063		$21,802,923
2020		$1,413,333		$2,500,000		$7,417,686		$7,178,289		$1,573,784		$887,798		$20,970,890		$19,407,572
2019		$1,600,000		$4,200,000		$6,816,740		$6,535,560		$2,071,748		$314,799		$21,538,847		$19,478,590
Neil G. Mitchill, Jr.    Executive Vice President & Chief Financial Officer(7)
2021		$760,606		$1,200,000		$2,424,908		$584,773		$0		$165,108		$5,135,395		$5,135,395
2020		$612,083		$500,000		$886,283		$841,522		$0		$159,526		$2,999,414		$2,999,414
2019		$591,667		$700,000		$1,588,229		$559,900		$0		$145,664		$3,585,460		$3,585,460
Michael R. Dumais    Executive Vice President, Chief Transformation Officer(8)
2021		$872,500		$1,200,000		$2,833,966		$679,572		$0		$478,062		$6,064,100		$6,064,100
2020		$800,417		$900,000		$1,723,436		$1,663,314		$524,320		$660,402		$6,271,889		$5,747,569
Christopher T. Calio    Chief Operating Officer(9)
2021		$723,083		$1,200,000		$2,833,966		$679,572		$0		$209,797		$5,646,418		$5,646,418
Stephen J. Timm    President, Collins Aerospace
2021		$718,500		$1,200,000		$2,833,966		$679,572		$0		$176,193		$5,608,231		$5,608,231
2020		$613,447		$600,000		$2,358,302		$1,282,991		$55,427		$435,300		$5,345,467		$5,290,040
Thomas A. Kennedy    Former Executive Chairman(10)
2021		$663,757		$1,283,350		$12,171,526		$3,161,246		$6,754,258		$489,615		$24,523,752		$17,769,494
Anthony F. O’Brien III    Former Executive Vice President & Chief Financial Officer(11)
2021		$254,449		$0		$3,238,924		$777,096		$2,014,431		$4,733,283		$11,018,183		$9,003,752
2020		$609,139		$1,000,000		$2,049,975		$0		$2,418,992		$73,380		$6,151,486		$3,732,494

(1)	Salary. Includes reduction in base salary for Messrs. Calio and Timm associated with Pratt & Whitney and Collins Aerospace furlough days during 2021.
(2)	Bonus. Annual incentive awards provided under the Raytheon Technologies Corporation Executive Annual Incentive Plan are primarily based on measured performance against pre-established financial goals and Corporate Responsibility Scorecard objectives (as detailed on pages 47-51). However, the Committee retains discretion to adjust annual incentive award amounts based on its assessment of overall performance. Consequently, we report annual incentive awards in the Bonus column rather than in a Non-Equity Incentive Plan Compensation column.
(3)	Stock Awards. Amounts shown include the grant date fair value of RSUs and PSUs granted in 2021 under the Raytheon Technologies Corporation 2018 Long-Term Incentive Plan, as amended and restated (“RTX LTIP”). The assumptions made in calculating the fair value of these awards are set forth in Note 21: Stock Based Compensation, to the Consolidated Financial Statements in RTX’s 2021 Annual Report on Form 10-K (“2021 Form 10-K”). Additionally, for Mr. Kennedy, the amounts shown also include incremental fair value of $3,670,352 resulting from a grant modification to certain unvested stock awards in connection with his retirement from the Company. See footnote (7) on page 69 for additional details. For the 2021 PSUs, if the highest level of performance is achieved for all performance metrics, the grant date fair values would be: Mr. Hayes, $12,848,441; Mr. Mitchill, $2,215,957; Mr. Dumais, $3,101,311; Mr. Calio, $3,101,311; Mr. Timm, $3,101,311; Mr. Kennedy, $9,303,933; and Mr. O’Brien, $3,544,508.

 

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COMPENSATION TABLES | SUMMARY COMPENSATION TABLE

(4)	Option Awards. Amounts shown include the grant date fair value of SARs granted under the RTX LTIP during 2021. The assumptions made in the valuation of these awards are set forth in Note 21: Stock Based Compensation, to the Consolidated Financial Statements in RTX’s 2021 Form 10-K. For Mr. Kennedy, the amounts shown also include an incremental fair value of $1,122,530 resulting from a grant modification to his 2021 SARs in connection with his retirement from the Company. See footnote (7) on page 69 for additional details.
(5)	Change in Pension Value and Nonqualified Deferred Compensation Earnings. The amounts in this column reflect the change (if any) in the year-over-year actuarial present value of each NEO’s accrued benefit under the Company’s defined benefit plans and above-market earnings (if any) under the Company’s deferred compensation plans. Messrs. Dumais (-$51,593), Calio (-$6,176) and Timm (-$14,015) all had a negative change in present value of their pension benefits from the prior year; however per SEC rules, the values shown in this column are zero. The legacy UTC pension plans were closed to new participants on January 1, 2010, and were closed to all participants effective December 31, 2019. As a result, for Messrs. Hayes, Dumais, Calio and Timm, the change in pension value is entirely attributable to year-over-year changes in pension plan actuarial assumptions. The legacy RTN pension plans were closed to new participants on January 1, 2007. However, since Messrs. Kennedy and O’Brien were hired prior to this date, they continued to accrue benefits under these pension plans until their separation from the Company. Actuarial value computations are based on the assumptions established in accordance with FASB ASC Topic 715 and discussed in Note 11: Employee Benefit Plans, to the Consolidated Financial Statements in RTX’s 2021 Form 10-K. RTX’s deferred compensation plans do not provide above-market rates of return. However, an above-market interest rate is paid under the frozen Sundstrand Corporation Deferred Compensation Plan, which was assumed by the Company upon its acquisition of Sundstrand Corporation in 1999. Mr. Hayes accrued $9,751 in above-market earnings under this plan in 2021.
(6)	All Other Compensation. The 2021 amounts in this column consist of the following items shown in the chart below. See page 61 for details on changes to executive perquisites.

 

Name		Personal Use of Corporate Aircraft(a)		Company Car(b)		Insurance Premiums(c)		Company Contributions to Defined Contribution Plans(d)		Payments upon Termination of Employment(e)		Relocation Benefits(f)		Financial Planning(g)		Health Benefits(h)		Industry Club (i)		Misc.(j)		Total
G. Hayes		$87,418		$38,257		$0		$475,600		$0		$0		$15,498		$21,383		$0		$7,106		$645,262
N. Mitchill, Jr.		$1,462		$25,349		$0		$108,412		$0		$0		$0		$23,368		$0		$6,517		$165,108
M. Dumais		$0		$33,550		$71,867		$205,610		$0		$127,500		$16,000		$20,633		$0		$2,902		$478,062
C. Calio		$1,462		$28,047		$0		$141,775		$0		$0		$0		$26,720		$8,000		$3,793		$209,797
S. Timm		$0		$22,673		$0		$121,275		$0		$0		$3,602		$18,972		$8,374		$1,297		$176,193
T. Kennedy		$133,165		$584		$1,586		$155,272		$136,307		$0		$15,000		$39,019		$8,000		$682		$489,615
A. O’Brien III		$0		$0		$16,112		$53,397		$4,632,398		$0		$10,000		$21,141		$0		$235		$4,733,283

(7)	Mr. Mitchill served in the role of Corporate Vice President, Financial Planning & Analysis and Investor Relations until April 7, 2021, when he was appointed Executive Vice President & Chief Financial Officer.
(8)	Mr. Dumais served in the role of Executive Vice President, Corporate Strategy & Development until January 11, 2021, when he was appointed Executive Vice President, Chief Transformation Officer.
(9)	Mr. Calio served in the role of President, Pratt & Whitney until March 1, 2022, when he was appointed to the role of Chief Operating Officer.
(10)	Mr. Kennedy served in the role of Executive Chairman until his retirement from the Company on June 1, 2021.
(11)	Mr. O’Brien served in the role of Executive Vice President & Chief Financial Officer until his departure from the Company on April 7, 2021.

 

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COMPENSATION TABLES | GRANTS OF PLAN-BASED AWARDS

Grants of Plan-Based Awards

				Estimated Future Payouts under Equity Incentive Plan Awards(1)						All Other Stock Awards:		All Other Option Awards: Number of				Grant Date Fair
Grant Date		Approval Date		Threshold (#)		Target (#)		Maximum (#)		Number of Shares of Stock or Units (#)(2)		Securities Underlying Options (#)(3)		Exercise or Base Price of Option Awards ($/Sh)(4)		Value of Stock and Option Awards ($)(5)
G. Hayes
2/8/2021		2/5/2021		7,501		120,020		240,040		-		-		-		$8,839,773
2/8/2021		2/5/2021		-		-		-		-		181,900		$72.49		$2,815,812
2/8/2021		2/5/2021		-		-		-		40,010		-		-		$2,900,325
N. Mitchill, Jr.
2/8/2021		2/5/2021		518		8,280		16,560		-		-		-		$609,843
2/8/2021		2/5/2021		-		-		-		-		18,900		$72.49		$292,572
2/8/2021		2/5/2021		-		-		-		8,280		-		-		$600,217
4/26/2021(6)		4/25/2021		695		11,115		22,230		-		-		-		$914,743
4/26/2021(6)		4/25/2021		-		-		-		-		16,900		$81.00		$292,201
4/26/2021(6)		4/25/2021		-		-		-		3,705		-		-		$300,105
M. Dumais
2/8/2021		2/5/2021		1,811		28,970		57,940		-		-		-		$2,133,713
2/8/2021		2/5/2021		-		-		-		-		43,900		$72.49		$679,572
2/8/2021		2/5/2021		-		-		-		9,660		-		-		$700,253
C. Calio
2/8/2021		2/5/2021		1,811		28,970		57,940		-		-		-		$2,133,713
2/8/2021		2/5/2021