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Delaware | 3728 | 20-2436320 | ||
(State or Other Jurisdiction of Incorporation or Organization) | (Primary Standard Industrial Classification Code No.) | (I.R.S. Employer Identification No.) |
Joel I. Greenberg, Esq. Mark S. Kingsley, Esq. Kaye Scholer LLP 425 Park Avenue New York, New York 10022 (212) 836-8000 | Gloria Farha Flentje, Esq. General Counsel Spirit AeroSystems, Inc. 3801 South Oliver Wichita, Kansas 67210 (316) 526-9000 | William J. Whelan, III, Esq. Cravath, Swaine & Moore LLP Worldwide Plaza 825 Eighth Avenue New York, New York 10019 (212) 474-1000 |
Proposed Maximum | Proposed Maximum | |||||||||||
Title of Each Class of | Amount to be | Offering | Aggregate | Amount of | ||||||||
Securities to be Registered | Registered | Price per Unit | Offering Price | Registration Fee | ||||||||
Class A Common Stock, par value $0.01 per share | 35,650,000(1) | $31.74(2) | $1,131,531,000(2) | $34,738 | ||||||||
(1) | Estimated solely for the purpose of calculating the registration fee and includes shares that the underwriters have the option to purchase solely to cover over-allotments, if any. The actual number of shares to be registered may change. | |
(2) | Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(c) of the Securities Act of 1933, as amended, based upon the average of the high and low sales prices for our class A common stock reported on the New York Stock Exchange on May 1, 2007. |
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The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. |
Underwriting | ||||||||||||
Price to | Discounts and | Proceeds to Selling | ||||||||||
Public | Commissions | Stockholders | ||||||||||
Per Share | $ | $ | $ | |||||||||
Total | $ | $ | $ |
Credit Suisse | Goldman, Sachs & Co. | Morgan Stanley |
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EX-1.1: FORM OF UNDERWRITING AGREEMENT | ||||||||
EX-21.1: SUBSIDIARIES | ||||||||
EX-23.1: CONSENT OF PRICEWATERHOUSECOOPERS LLP | ||||||||
EX-23.2: CONSENT OF DELOITTE & TOUCHE LLP |
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• | our ability to continue to grow our business and execute our growth strategy; | |
• | the build rates of certain Boeing aircraft including, but not limited to, the B737 program, the B747 program, the B767 program and the B777 program and build rates of the Airbus A320 and A380 programs; | |
• | our ability to enter into supply arrangements with additional customers and to satisfy performance requirements under existing supply contracts with Boeing and Airbus; | |
• | any adverse impact on Boeing’s production of aircraft resulting from reduced orders by Boeing’s customers; | |
• | the success and timely progression of Boeing’s new B787 aircraft program, including receipt of necessary regulatory approvals; | |
• | future levels of business in the aerospace and commercial transport industries; | |
• | competition from original equipment manufacturers and other aerostructures suppliers; | |
• | the effect of governmental laws, such as U.S. export control laws, environmental laws and agency regulation, in the U.S. and abroad; | |
• | the effect of new commercial and business aircraft development programs, their timing and resource requirements that may be placed on us; | |
• | the cost and availability of raw materials; | |
• | our ability to recruit and retain highly skilled employees and our relationships with the unions representing many of our employees; | |
• | spending by the United States and other governments on defense; | |
• | our continuing ability to operate successfully as a stand alone company; | |
• | the outcome or impact of ongoing or future litigation and regulatory actions; and | |
• | our exposure to potential product liability claims. |
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Class A common stock offered by the selling stockholders | shares | |
Common stock outstanding after this offering | shares of class A common stock and shares of class B common stock | |
Voting rights of class A common stock | Our class A common stock is entitled to one vote per share. Our class B common stock, which is not being offered in this offering but votes together with our class A common stock as a single class, is entitled to ten votes per share (reducing to one vote per share under certain limited circumstances). Our class B common stock, which is convertible into shares of our class A common stock on a1-for-1 basis, is identical to our class A common stock in all other respects. | |
Use of proceeds | We will not receive any proceeds from the sale of shares by the selling stockholders. | |
Dividend policy | We currently do not intend to pay cash dividends and, under conditions in which our cash is below specified levels, are prohibited from doing so under credit agreements governing our credit facilities. | |
Risk factors | See “Risk Factors” beginning on page 10 of this prospectus for a discussion of factors you should carefully consider before deciding to invest in our class A common stock. | |
NYSE symbol | “SPR” |
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Spirit Holdings | Predecessor | ||||||||||||||||||||||||
Period From | |||||||||||||||||||||||||
Twelve Months | June 17, 2005 | Period From | Fiscal Year | ||||||||||||||||||||||
�� | Three Months Ended | Ended | through | January 1, 2005 | Ended | ||||||||||||||||||||
March 29, | March 30, | December 31, | December 29, | through June 16, | December 31, | ||||||||||||||||||||
2007 | 2006 | 2006 | 2005 | 2005 | 2004 | ||||||||||||||||||||
(In millions, except per share data) | |||||||||||||||||||||||||
Statement of Operations Data: | |||||||||||||||||||||||||
Net sales/total cost transferred | $ | 954 | $ | 671 | $ | 3,208 | $ | 1,208 | $ | N/A | $ | N/A | |||||||||||||
Costs of sales/products transferred | 795 | 533 | 2,934 | 1,057 | 1,164 | 2,074 | |||||||||||||||||||
SG&A, R&D, other period costs(1) | 55 | 87 | 330 | 219 | 91 | 173 | |||||||||||||||||||
Total costs and expenses | 850 | 620 | 3,264 | 1,276 | 1,254 | 2,247 | |||||||||||||||||||
Operating income (loss) | 104 | 51 | (56 | ) | (68 | ) | N/A | N/A | |||||||||||||||||
Interest expense and financing fee amortization | (9 | ) | (11 | ) | (50 | ) | (25 | ) | N/A | N/A | |||||||||||||||
Interest income | 8 | 7 | 29 | 16 | N/A | N/A | |||||||||||||||||||
Other income (loss), net | 2 | 1 | 6 | 1 | N/A | N/A | |||||||||||||||||||
Net income (loss) before taxes | 105 | 48 | (71 | ) | (76 | ) | N/A | N/A | |||||||||||||||||
(Provision for) benefit from income taxes | (35 | ) | (25 | ) | 88 | (14 | ) | N/A | N/A | ||||||||||||||||
Net income (loss) | $ | 70 | $ | 23 | $ | 17 | $ | (90 | ) | N/A | N/A | ||||||||||||||
Basic weighted average number of common shares outstanding | 129.7 | 113.9 | 115.6 | 113.5 | N/A | N/A | |||||||||||||||||||
Basic net income (loss) per share applicable to common stock | $ | 0.54 | $ | 0.20 | $ | 0.15 | $ | (0.80 | ) | N/A | N/A | ||||||||||||||
Diluted weighted average number of common shares outstanding | 139.0 | 117.2 | 122.0 | 113.5 | N/A | N/A | |||||||||||||||||||
Diluted net income (loss) per share applicable to common stock | $ | 0.50 | $ | 0.19 | $ | 0.14 | $ | (0.80 | ) | N/A | N/A | ||||||||||||||
Other Financial Data: | |||||||||||||||||||||||||
Capital expenditures | $ | 88 | $ | 94 | $ | 343 | $ | 145 | $ | 48 | $ | 54 | |||||||||||||
Depreciation and amortization | $ | 23 | $ | 18 | $ | 65 | $ | 32 | $ | 40 | $ | 91 | |||||||||||||
Balance Sheet Data (end of period): | |||||||||||||||||||||||||
Cash and cash equivalents(2) | $ | 157 | $ | 236 | $ | 184 | $ | 241 | $ | 1 | $ | 3 | |||||||||||||
Working capital(3) | $ | 846 | $ | 436 | $ | 743 | $ | 436 | $ | 431 | $ | 481 | |||||||||||||
Total assets | $ | 2,840 | $ | 1,845 | $ | 2,722 | $ | 1,657 | $ | 1,020 | $ | 1,044 | |||||||||||||
Total long-term debt | $ | 590 | $ | 707 | $ | 594 | $ | 710 | N/A | N/A | |||||||||||||||
Shareholders’ equity | $ | 935 | $ | 373 | $ | 859 | $ | 326 | N/A | N/A |
(1) | Includes non-cash stock compensation expense of $7 million, $13 million, $57 million, $35 million, $22 million and $23 million for the respective periods starting with the three months ended March 29, 2007. | |
(2) | Prior to the Boeing Acquisition, the Predecessor was part of Boeing’s cash management system and, consequently, had no separate cash balance. Therefore, at June 16, 2005 and December 31, 2004, the Predecessor had negligible cash on the balance sheet. | |
(3) | Ending balance of accounts receivable, inventory and accounts payable on net basis. |
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• | changes in regulatory requirements; | |
• | domestic and foreign government policies, including requirements to expend a portion of program funds locally and governmental industrial cooperation requirements; | |
• | fluctuations in foreign currency exchange rates; | |
• | the complexity and necessity of using foreign representatives and consultants; | |
• | uncertainties and restrictions concerning the availability of funding credit or guarantees; | |
• | imposition of tariffs or embargoes, export controls and other trade restrictions; | |
• | the difficulty of management and operation of an enterprise spread over various countries; | |
• | compliance with a variety of foreign laws, as well as U.S. laws affecting the activities of U.S. companies abroad; and | |
• | economic and geopolitical developments and conditions, including international hostilities, acts of terrorism and governmental reactions, inflation, trade relationships and military and political alliances. |
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• | demands on management related to the increase in size after the transaction; | |
• | the diversion of management’s attention from the management of daily operations to the integration of operations; | |
• | difficulties in the assimilation and retention of employees; | |
• | difficulties in the assimilation of different cultures and practices, as well as in the assimilation of geographically dispersed operations and personnel, who may speak different languages; | |
• | difficulties combining operations that use different currencies or operate under different legal structures; | |
• | difficulties in the integration of departments, systems (including accounting systems), technologies, books and records and procedures, as well as in maintaining uniform standards, controls (including internal accounting controls), procedures and policies; and | |
• | constraints (contractual or otherwise) limiting our ability to consolidate, rationalizeand/or leverage supplier arrangements to achieve integration. |
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• | our ability to obtain additional financing for working capital, capital expenditures, acquisitions, debt service requirements or other general corporate purposes may be impaired; | |
• | we must use a portion of our cash flow for payments on our debt, which will reduce the funds available to us for other purposes; | |
• | we are more vulnerable to economic downturns and adverse industry conditions and our flexibility to plan for, or react to, changes in our business or industry is more limited; | |
• | our ability to capitalize on business opportunities and to react to competitive pressures, as compared to our competitors, may be compromised due to our level of debt; and | |
• | our ability to borrow additional funds or to refinance debt may be limited. |
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• | incur additional debt or issue our preferred stock; | |
• | pay dividends or make distributions to our stockholders; | |
• | repurchase or redeem our capital stock; | |
• | make investments; | |
• | incur liens; | |
• | enter into transactions with our stockholders and affiliates; | |
• | sell certain assets; | |
• | acquire the assets of, or merge or consolidate with, other companies; and | |
• | incur restrictions on the ability of our subsidiaries to make distributions or transfer assets to us. |
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• | multi-vote shares of common stock, which are owned by the Onex entities and management stockholders; | |
• | advance notice requirements for nominations for election to the board of directors or for proposing matters that can be acted on by stockholders at stockholder meetings; and | |
• | the authority of the board of directors to issue, without stockholder approval, up to 10 million shares of preferred stock with such terms as the board of directors may determine and an additional 65,302,819 shares of class A common stock (not including shares reserved for issuance upon conversion of outstanding shares of class B common stock) and an additional shares of class B common stock (not including shares issued but subject to vesting requirements under our benefit plans). |
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• | actual or anticipated fluctuations in our operating results; | |
• | changes in aerostructures pricing; | |
• | our competitors’ and customers’ announcements of significant contracts, acquisitions or strategic investments; | |
• | changes in our growth rates or our competitors’ and customers’ growth rates; | |
• | the timing or results of regulatory submissions or actions with respect to our business; | |
• | our inability to raise additional capital; | |
• | conditions of the aerostructure industry or in the financial markets or economic conditions in general; and | |
• | changes in stock market analyst recommendations regarding our class A common stock, other comparable companies or the aerospace industry in general. |
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Fiscal Year 2006: | High | Low | ||||||
Fourth Quarter ended December 31, 2006(1) | $ | 33.65 | $ | 27.48 |
Fiscal Year 2007: | High | Low | ||||||
First Quarter ended March 29, 2007 | $ | 32.61 | $ | 27.45 | ||||
Second Quarter (through May 3, 2007) | $ | 33.34 | $ | 31.16 |
(1) | The first day of trading of the class A common stock was November 21, 2006. |
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As of March 29, 2007 | ||||
(Dollars in millions) | ||||
Long-term debt, including current portion: | ||||
Revolving credit facility(1) | — | |||
Term loan | $ | 589.8 | ||
Capital leases and other debt | 25.3 | |||
Total debt | 615.1 | |||
Shareholders’ equity: | ||||
Preferred stock, $0.01 par value per share, 10,000,000 shares authorized; nil shares issued and outstanding | — | |||
Class A common stock, $0.01 par value per share, 200,000,000 shares authorized; 68,159,104 shares issued and outstanding | 0.7 | |||
Class B common stock, $0.01 par value per share, 150,000,000 shares authorized; 71,446,595 shares issued and outstanding | 0.7 | |||
Additional paid-in capital | 867.2 | |||
Accumulated other comprehensive income | 70.4 | |||
Accumulated deficit | (3.7 | ) | ||
Total shareholders’ equity | 935.3 | |||
Total capitalization | $ | 1,550.4 |
(1) | As of March 29, 2007, we had no borrowings under the $400.0 million revolving credit facility, with availability of $387.6 million, which is net of $12.4 million of letters of credit outstanding. |
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Spirit Holdings | Predecessor | ||||||||||||||||||||||||||||||||
Twelve | Period From | Period From | |||||||||||||||||||||||||||||||
Months | June 17, 2005 | January 1, | |||||||||||||||||||||||||||||||
Ended | through | 2005 through | |||||||||||||||||||||||||||||||
Three Months Ended | December 31, | December 29, | June 16, | Fiscal Year Ended December 31, | |||||||||||||||||||||||||||||
March 29, 2007 | March 30, 2006 | 2006 | 2005 | 2005 | 2004 | 2003 | 2002 | ||||||||||||||||||||||||||
(In millions, except per share data) | |||||||||||||||||||||||||||||||||
Statement of Income Data: | |||||||||||||||||||||||||||||||||
Net sales | $ | 954.1 | $ | 670.8 | $ | 3,207.7 | $ | 1,207.6 | N/A | N/A | N/A | N/A | |||||||||||||||||||||
Cost of sales | 794.8 | 533.0 | 2,934.3 | 1,056.4 | $ | 1,163.9 | $ | 2,074.3 | $ | 2,063.9 | $ | 2,350.7 | |||||||||||||||||||||
Selling, general & administrative expenses(1) | 45.1 | 44.8 | 225.0 | 140.7 | 79.7 | 155.1 | 116.7 | 135.1 | |||||||||||||||||||||||||
Research & development | 10.4 | 42.4 | 104.7 | 78.3 | 11.0 | 18.1 | 17.3 | 18.5 | |||||||||||||||||||||||||
Special charges(2) | — | — | — | — | — | — | 10.3 | — | |||||||||||||||||||||||||
Operating income (loss) | 103.8 | 50.6 | (56.3 | ) | (67.8 | ) | |||||||||||||||||||||||||||
Interest expense and financing fee amortization | (8.9 | ) | (11.2 | ) | (50.1 | ) | (25.5 | ) | N/A | N/A | N/A | N/A | |||||||||||||||||||||
Interest income | 7.7 | 7.1 | 29.0 | 15.4 | — | — | — | — | |||||||||||||||||||||||||
Other income, net | 2.0 | 1.4 | 5.9 | 1.3 | N/A | N/A | N/A | N/A | |||||||||||||||||||||||||
Income (loss) before income taxes | 104.6 | 47.9 | (71.5 | ) | (76.6 | ) | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
(Provision for) benefits from income taxes | (34.8 | ) | (25.4 | ) | 88.3 | (13.7 | ) | N/A | N/A | N/A | N/A | ||||||||||||||||||||||
Net income (loss) | $ | 69.8 | $ | 22.5 | $ | 16.8 | $ | (90.3 | ) | N/A | N/A | N/A | N/A | ||||||||||||||||||||
Net income (loss) per share, basic | $ | 0.54 | $ | 0.20 | $ | 0.15 | $ | (0.80 | ) | N/A | N/A | N/A | N/A | ||||||||||||||||||||
Shares used in per share calculation, basic | 129.7 | 113.9 | 115.6 | 113.5 | N/A | N/A | N/A | N/A | |||||||||||||||||||||||||
Net income (loss) per share, diluted | $ | 0.50 | $ | 0.19 | $ | 0.14 | $ | (0.80 | ) | N/A | N/A | N/A | N/A | ||||||||||||||||||||
Shares used in per share calculation, diluted | 139.0 | 117.2 | 122.0 | 113.5 | N/A | N/A | N/A | N/A | |||||||||||||||||||||||||
Other Financial Data: | |||||||||||||||||||||||||||||||||
Cash flow provided by (used in) operating activities | $ | 50.1 | $ | 90.0 | $ | 273.6 | $ | 223.8 | $ | (1,177.8 | ) | $ | (2,164.9 | ) | $ | (2,081.8 | ) | $ | (2,281.8 | ) | |||||||||||||
Cash flow used in investing activities | $ | (75.0 | ) | $ | (93.8 | ) | $ | (473.6 | ) | $ | (1,030.3 | ) | $ | (48.2 | ) | $ | (54.4 | ) | $ | (43.3 | ) | $ | (50.4 | ) | |||||||||
Cash flow provided by (used in) financing activities | $ | (2.1 | ) | $ | (1.3 | ) | $ | 140.9 | $ | 1,047.8 | N/A | N/A | N/A | N/A | |||||||||||||||||||
Capital expenditures | $ | (87.5 | ) | $ | (93.8 | ) | $ | (343.2 | ) | $ | (144.6 | ) | $ | (48.2 | ) | $ | (54.4 | ) | $ | (43.3 | ) | $ | (50.4 | ) |
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Spirit Holdings | Predecessor | ||||||||||||||||||||||||||||
As of | As of | ||||||||||||||||||||||||||||
March 29, | March 30, | December 31, | December 29, | December 31, | December 31, | December 31, | |||||||||||||||||||||||
2007 | 2006 | 2006 | 2005 | 2004 | 2003 | 2002 | |||||||||||||||||||||||
(In millions) | |||||||||||||||||||||||||||||
Consolidated Balance Sheet Data: | |||||||||||||||||||||||||||||
Cash & cash equivalents(3) | $ | 157.3 | $ | 236.2 | $ | 184.3 | $ | 241.3 | $ | 3.0 | $ | 3.6 | $ | 1.3 | |||||||||||||||
Accounts receivable, net | $ | 315.8 | $ | 174.2 | $ | 200.2 | $ | 98.8 | $ | 2.0 | $ | 2.0 | $ | 1.6 | |||||||||||||||
Inventory, net | $ | 947.0 | $ | 537.1 | $ | 882.2 | $ | 510.7 | $ | 524.6 | $ | 529.4 | $ | 535.1 | |||||||||||||||
Property, plant & equipment, net | $ | 841.0 | $ | 595.9 | $ | 773.8 | $ | 518.8 | $ | 511.0 | $ | 555.3 | $ | 611.8 | |||||||||||||||
Total assets | $ | 2,840.1 | $ | 1,844.7 | $ | 2,722.2 | $ | 1,656.6 | $ | 1,043.6 | $ | 1,093.3 | $ | 1,153.1 | |||||||||||||||
Total debt | $ | 615.1 | $ | 719.8 | $ | 618.2 | $ | 721.6 | N/A | N/A | N/A | ||||||||||||||||||
Long-term debt | $ | 590.2 | $ | 706.7 | $ | 594.3 | $ | 710.0 | N/A | N/A | N/A | ||||||||||||||||||
Shareholders’ equity | $ | 935.3 | $ | 373.1 | $ | 859.0 | $ | 325.8 | N/A | N/A | N/A |
(1) | Includes non-cash stock compensation expenses of $6.6 million, $13.4 million, $56.6 million, $34.7 million, $22.1 million, $23.3 million, $12.9 million and $9.1 million for the respective periods starting with the three months ended March 29, 2007. | |
(2) | In 2003, a charge was allocable to Boeing Wichita in connection with the close-out of the Boeing B757 program. | |
(3) | Prior to the Boeing Acquisition, the Predecessor was part of Boeing’s cash management system and, consequently, had no separate cash balance. Therefore, at December 31, 2004, December 31, 2003 and December 31, 2002, the Predecessor had negligible cash on the balance sheet. |
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FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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2002 | 2003 | 2004 | 2005 | 2006 | 2007(1) | |||||||||||||||||||
Boeing | 381 | 281 | 285 | 290 | 398 | 440 | ||||||||||||||||||
Airbus | 303 | 305 | 320 | 378 | 434 | 440 | ||||||||||||||||||
Total | 684 | 586 | 605 | 668 | 832 | 880 | ||||||||||||||||||
(1) | Boeing has announced 2007 deliveries to be between440-445. Airbus has announced 2007 deliveries to be between440-450. |
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(Dollars in millions) | ||||
Cash payment to Boeing | $ | 903.9 | ||
Direct costs of the acquisition | 20.2 | |||
Less: | ||||
Consideration to be returned from Boeing for sale of capital assets | (202.8 | ) | ||
Consideration to be returned from Boeing for transition costs | (30.0 | ) | ||
Working capital settlement | (19.0 | ) | ||
Total consideration | $ | 672.3 | ||
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Book Value | ||||
June 16, 2005 | ||||
(Dollars in millions) | ||||
Cash | $ | 1.3 | ||
Accounts receivable | 0.3 | |||
Inventory | 479.2 | |||
Other current assets | 0.3 | |||
Property, plant and equipment | 231.1 | |||
Intangible assets | 17.3 | |||
Other assets | 6.8 | |||
Pension asset | 101.2 | |||
Accounts payable and accrued liabilities | (130.2 | ) | ||
Pension and post-retirement liabilities | (35.0 | ) | ||
Net assets acquired | $ | 672.3 | ||
Cash payment to BAE Systems | $ | 139.1 | ||
Direct costs of the acquisition | 3.6 | |||
Working capital settlement | 3.0 | |||
Total consideration | $ | 145.7 | ||
Book Value | ||||
April 1, 2006 | ||||
(Dollars in millions) | ||||
Cash | $ | 0.3 | ||
Accounts receivable | 61.9 | |||
Inventory | 44.2 | |||
Other current assets | — | |||
Property, plant and equipment | 88.0 | |||
Intangible assets | 30.1 | |||
Goodwill | 10.3 | |||
Currency hedge assets | 11.1 | |||
Accounts payable and accrued liabilities | (67.0 | ) | ||
Pension liabilities | (19.1 | ) | ||
Other liabilities | (12.4 | ) | ||
Currency hedge liabilities | (1.7 | ) | ||
Net assets acquired | $ | 145.7 | ||
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• | Recognize the funded status of our defined benefit plans in our consolidated financial statements. | |
• | Recognize as a component of other compensation income any actuarial gains and losses and prior service costs and credits that arise during the period but are not immediately recognized as components of net periodic benefit cost. | |
• | Measure defined benefit plan assets and obligations as of our fiscal year end. | |
• | Disclose in the notes to the financial statements additional information about certain effects on net periodic cost for the subsequent fiscal year that arise from delayed recognition of gains or losses, prior to service costs or credits, and transition asset or obligation. | |
• | Change our measurement date from November to the fiscal year end (i.e., December 31) by year-end 2008. |
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• | change from discrete unit or block costing to the use of long-term contract accounting; | |
• | reclassification of certain costs from cost of sales to selling, general and administrative costs, or SG&A; | |
• | change from accelerated depreciation methods for most personal property to straight line depreciation methods for all property, plant and equipment; | |
• | implementation of accounting for new activities that were not performed by or otherwise recognized by the Predecessor; and | |
• | establishment of a lower dollar threshold for capitalization of internal use software. |
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Spirit Holdings | Predecessor | ||||||||||||||||||||||||||||
Period From | Period From | ||||||||||||||||||||||||||||
Twelve Months | June 17, | January 1, | Fiscal Year | ||||||||||||||||||||||||||
Three Months Ended | Ended | 2005 through | 2005 through | Ended | |||||||||||||||||||||||||
March 29, | March 30, | December 31, | December 29, | June 16, | December 31, | ||||||||||||||||||||||||
2007 | 2006 | 2006 | 2005 | 2005 | 2004 | ||||||||||||||||||||||||
(Dollars in millions) | |||||||||||||||||||||||||||||
Net revenues | $ | 954.1 | $ | 670.8 | $ | 3,207.7 | $ | 1,207.6 | N/A | N/A | |||||||||||||||||||
Cost of sales(a) | 794.8 | 533.0 | 2,934.3 | 1,056.4 | $ | 1,163.9 | $ | 2,074.3 | |||||||||||||||||||||
SG&A, R&D, other period costs(b) | 55.5 | 87.2 | 329.7 | 219.0 | 90.7 | 173.2 | |||||||||||||||||||||||
Operating income (loss) | 103.8 | 50.6 | (56.3 | ) | (67.8 | ) | N/A | N/A | |||||||||||||||||||||
Interest expense and financing fee amortization(c) | (8.9 | ) | (11.2 | ) | (50.1 | ) | (25.5 | ) | N/A | N/A | |||||||||||||||||||
Interest income | 7.7 | 7.1 | 29.0 | 15.4 | — | — | |||||||||||||||||||||||
Other income (loss), net | 2.0 | 1.4 | 5.9 | 1.3 | N/A | N/A | |||||||||||||||||||||||
Provision for income taxes | (34.8 | ) | (25.4 | ) | 88.3 | (13.7 | ) | N/A | N/A | ||||||||||||||||||||
Net income (loss) | $ | 69.8 | $ | 22.5 | $ | 16.8 | $ | (90.3 | ) | N/A | N/A | ||||||||||||||||||
(a) | Included in 2006 cost of sales are the fourth quarter charges related to the Union Equity Participation Plan payout of $321.9 million. | |
(b) | Includes non-cash stock compensation expense of $6.6 million, $13.4 million, $56.6 million, $34.7 million, $22.1 million and $23.3 million, respectively, for the periods starting with the three months ended March 29, 2007. | |
(c) | Included in interest expense and financing fee amortization for the twelve months ended December 31, 2006 are expenses related to our initial public offering of $3.7 million. |
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Three Months Ended | ||||||||
March 29, 2007 | March 30, 2006 | |||||||
(Dollars in millions) | ||||||||
Net Revenues | $ | 954.1 | $ | 670.8 | ||||
Operating costs and expenses: | ||||||||
Cost of sales | 794.8 | 533.0 | ||||||
Selling, general and administrative | 45.1 | 44.8 | ||||||
Research and development | 10.4 | 42.4 | ||||||
Total Costs and Expenses | 850.3 | 620.2 | ||||||
Operating Income | 103.8 | 50.6 | ||||||
Interest expense and financing fee amortization | (8.9 | ) | (11.2 | ) | ||||
Interest income | 7.7 | 7.1 | ||||||
Other income, net | 2.0 | 1.4 | ||||||
Income before income taxes | 104.6 | 47.9 | ||||||
Income tax provision | (34.8 | ) | (25.4 | ) | ||||
Net income | $ | 69.8 | $ | 22.5 | ||||
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Three Months Ended | ||||||||
March 29, 2007 | March 30, 2006(1) | |||||||
(Dollars in millions) | ||||||||
Segment Net Revenues | ||||||||
Fuselage Systems | $ | 445.2 | $ | 353.7 | ||||
Propulsion Systems | 260.4 | 216.5 | ||||||
Wing Systems | 241.2 | 92.0 | ||||||
All Other | 7.3 | 8.6 | ||||||
$ | 954.1 | $ | 670.8 | |||||
(1) | Net revenues for Wing Systems exclude Spirit Europe before April 1, 2006, the date we acquired BAE Aerostructures. |
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Three Months Ended | ||||||||
Model | March 29, 2007 | March 30, 2006(1) | ||||||
B737 | 83 | 64 | ||||||
B747 | 5 | 3 | ||||||
B767 | 3 | 3 | ||||||
B777 | 21 | 14 | ||||||
Total Boeing | 112 | 84 | ||||||
A320 Family | 93 | — | ||||||
A330/340 | 22 | — | ||||||
A380 | — | — | ||||||
Total Airbus | 115 | — | ||||||
Hawker 800 Series | 16 | — | ||||||
Total | 243 | 84 | ||||||
(1) | Deliveries exclude Spirit Europe before April 1, 2006, the date we acquired BAE Aerostructures. |
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Three Months Ended | ||||||||
March 29, 2007 | March 30, 2006(1) | |||||||
Segment Operating Income | ||||||||
Fuselage Systems | $ | 83.0 | $ | 60.1 | ||||
Propulsion Systems | 40.3 | 29.8 | ||||||
Wing Systems | 23.2 | 5.5 | ||||||
All Other | 0.8 | 0.5 | ||||||
147.3 | 95.9 | |||||||
Unallocated corporate SG&A | (42.5 | ) | (43.4 | ) | ||||
Unallocated research and development | (1.0 | ) | (1.9 | ) | ||||
Total operating income | $ | 103.8 | $ | 50.6 | ||||
(1) | Excludes Spirit Europe before April 1, 2006, the date we acquired BAE Aerostructures. |
Ten and One-Half | ||||||||
Twelve Months Ended | Months Ended | |||||||
December 31, 2006 | December 29, 2005(1) | |||||||
(Dollars in millions) | ||||||||
Net revenues | $ | 3,207.7 | $ | 1,207.6 | ||||
Operating costs and expenses | ||||||||
Cost of sales | 2,934.3 | 1,056.4 | ||||||
Selling, general and administrative | 225.0 | 140.7 | ||||||
Research and development | 104.7 | 78.3 | ||||||
Total costs and expenses | 3,264.0 | 1,275.4 | ||||||
Operating income (loss) | (56.3 | ) | (67.8 | ) | ||||
Interest expense and financing fee amortization | (50.1 | ) | (25.5 | ) | ||||
Interest income | 29.0 | 15.4 | ||||||
Other income, net | 5.9 | 1.3 | ||||||
Income (loss) before income taxes | (71.5 | ) | (76.6 | ) | ||||
Income tax provision | 88.3 | (13.7 | ) | |||||
Net income (loss) | $ | 16.8 | $ | (90.3 | ) | |||
(1) | Includes only six and one-half months of operations and excludes Spirit Europe. |
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Ten and One-Half | ||||||||
Twelve Months Ended | Months Ended | |||||||
December 31, 2006(1) | December 29, 2005(2) | |||||||
(Dollars in millions) | ||||||||
Segment Revenues | ||||||||
Fuselage Systems | $ | 1,570.0 | $ | 637.7 | ||||
Propulsion Systems | 887.7 | 372.2 | ||||||
Wing Systems | 720.3 | 170.0 | ||||||
All Other | 29.7 | 27.7 | ||||||
Total | $ | 3,207.7 | $ | 1,207.6 | ||||
(1) | Revenues for Wing Systems include Spirit Europe after April 1, 2006, the date we acquired BAE Aerostructures. | |
(2) | Includes only six and one-half months of operations and excludes Spirit Europe. |
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Spirit Holdings | Predecessor | |||||||||||
Ten and One-Half | Five and One-Half | |||||||||||
Twelve Months Ended | Months Ended | Months Ended | ||||||||||
Model | December 31, 2006(1) | December 29, 2005(2) | June 16, 2005 | |||||||||
B737 | 302 | 119 | 114 | |||||||||
B747 | 13 | 7 | 8 | |||||||||
B767 | 12 | 5 | 6 | |||||||||
B777 | 65 | 24 | 25 | |||||||||
Total Boeing | 392 | 155 | 153 | |||||||||
A320 Family | 241 | — | — | |||||||||
A330/340 | 73 | — | — | |||||||||
A380 | 4 | — | — | |||||||||
Total Airbus | 318 | — | — | |||||||||
Hawker 800 Family | 51 | — | — | |||||||||
Total Spirit | 761 | 155 | 153 | |||||||||
(1) | Deliveries of the Airbus and Hawker Beechcraft products began on April 1, 2006 with the acquisition of BAE Aerostructures. | |
(2) | Includes only six and one-half months of operations and excludes Spirit Europe. |
Ten and One-Half | ||||||||
Twelve Months Ended | Months Ended | |||||||
December 31, 2006(1) | December 29, 2005(2) | |||||||
(Dollars in millions) | ||||||||
Segment Operating Income | ||||||||
Fuselage Systems | $ | 112.5 | $ | 43.7 | ||||
Propulsion Systems | 33.7 | 24.5 | ||||||
Wing Systems | 11.8 | 5.1 | ||||||
All Other | 4.3 | (1.2 | ) | |||||
Total Segment Operating Income | 162.3 | 72.1 | ||||||
Unallocated Corporate Expenses(3) | (218.6 | ) | (139.9 | ) | ||||
Operating Income (Loss) | $ | (56.3 | ) | $ | (67.8 | ) | ||
(1) | Operating income for Wing Systems includes Spirit Europe after April 1, 2006, the date we acquired BAE Aerostructures. | |
(2) | Includes only six and one-half months of operations and excludes Spirit Europe. | |
(3) | Unallocated corporate expenses for 2006 is comprised of $2.1 of research and development, $27.5 of non-recurring transition cost, and $189.0 of selling, general and administrative costs which includes $8.3 million of fourth quarter charges related to the Company’s initial public offering. |
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Predecessor and Spirit | ||||||||
Combined | Predeccessor | |||||||
Period From | Period From | |||||||
January 1, 2005 to | January 1, 2004 to | |||||||
Model | December 29, 2005 | December 31, 2004 | ||||||
B737 | 233 | 201 | ||||||
B747 | 15 | 13 | ||||||
B757 | 0 | 9 | ||||||
B767 | 11 | 10 | ||||||
B777 | 49 | 37 | ||||||
Total | 308 | 270 | ||||||
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Predecessor | ||||||||
Period From | ||||||||
January 1, 2005 | ||||||||
through | Year Ended | |||||||
June 16, 2005 | December 31, 2004 | |||||||
(Dollars in millions) | ||||||||
Cost of products transferred | $ | 1,163.9 | $ | 2,074.3 | ||||
SG&A, R&D, other period costs | $ | 90.7 | $ | 173.2 | ||||
SG&A, R&D, other period costs as a percentage of cost of products transferred | 7.8 | % | 8.3 | % |
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Quarter Ended | ||||
2007 | March 29, 2007 | |||
Net Revenues | $ | 954.1 | ||
Operating income (loss) | $ | 103.8 | ||
Net income (loss) | $ | 69.8 | ||
Earnings per share, basic | $ | 0.54 | ||
Earnings per share, diluted | $ | 0.50 |
Quarter Ended | ||||||||||||||||
December 31, | September 28, | June 29, | March 30, | |||||||||||||
2006 | 2006 | 2006 | 2006 | 2006 | ||||||||||||
Net Revenues | $ | 851.8 | $ | 829.7 | $ | 855.4 | $ | 670.8 | ||||||||
Operating income (loss) | $ | (240.4 | ) | $ | 77.5 | $ | 56.0 | $ | 50.6 | |||||||
Net income (loss) | $ | (69.4 | ) | $ | 34.0 | $ | 29.7 | $ | 22.5 | |||||||
Earnings per share, basic | $ | (0.58 | ) | $ | 0.30 | $ | 0.26 | $ | 0.20 | |||||||
Earnings per share, diluted | $ | (0.58 | ) | $ | 0.28 | $ | 0.25 | $ | 0.19 |
Quarter Ended | Period From June 17, | |||||||
December 29, | 2005 through | |||||||
2005 | 2005 | September 29, 2005(a) | ||||||
Net Revenues | $ | 557.4 | $ | 650.2 | ||||
Operating income (loss) | $ | (39.0 | ) | $ | (28.8 | ) | ||
Net income (loss) | $ | (46.9 | ) | $ | (43.4 | ) | ||
Earnings per share, basic | $ | (0.42 | ) | $ | (0.38 | ) | ||
Earnings per share, diluted | $ | (0.42 | ) | $ | (0.38 | ) |
(a) | Spirit Holdings was incorporated in the state of Delaware on February 7, 2005 and commenced operations on June 17, 2005 through the acquisition by Spirit of Boeing Wichita. |
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2013 and | ||||||||||||||||||||||||||||||||
Contractual Obligations | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 | After | Total | ||||||||||||||||||||||||
(Dollars in millions) | ||||||||||||||||||||||||||||||||
Principal Payment on Term Loan B(1) | $ | 5.9 | $ | 5.9 | $ | 5.9 | $ | 5.9 | $ | 5.9 | $ | 143.4 | $ | 416.9 | $ | 589.8 | ||||||||||||||||
Non-Cancelable Operating Lease Payments | 5.8 | 4.7 | 3.4 | 2.1 | 1.2 | 0.6 | 3.7 | 21.5 | ||||||||||||||||||||||||
Non-Cancelable Capital Lease Payments(2) | 19.3 | 9.6 | 1.0 | — | — | — | — | 29.9 | ||||||||||||||||||||||||
Interest on Debt(3) | 37.0 | 36.6 | 36.2 | 35.8 | 35.5 | 35.1 | 13.1 | 229.3 | ||||||||||||||||||||||||
Purchase Obligations(4) | 71.4 | — | — | — | — | — | — | 71.4 | ||||||||||||||||||||||||
Total | $ | 139.4 | $ | 56.8 | $ | 46.5 | $ | 43.8 | $ | 42.6 | $ | 179.1 | $ | 433.7 | $ | 941.9 | ||||||||||||||||
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(1) | Does not include repayment of B787 advances to Boeing, which is reflected in our consolidated balance sheet as a long-term liability. | |
(2) | Treats the financing of software license purchases and direct financing of system implementation as capital leases. | |
(3) | Interest on our debt was calculated for all years using the effective rate as of December 31, 2006 of 6.29%. | |
(4) | Purchase obligations represent property, plant and equipment commitments at December 31, 2006. Although we also have significant other purchase obligations, most commonly in the form of purchase orders, the timing of these purchases is often variable rather than specific and the payments made by our customers in accordance with our long-term contracts, including advance payments, substantially reimburse the payments due. Accordingly, these obligations are not included in the table. |
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• | an effective fixed interest rate of 5.99% from June 2005 to July 2008 on $100.0 million of the Term Loan B; | |
• | an effective fixed interest rate of 6.05% from June 2005 to July 2009 on $300.0 million of the Term Loan B; and | |
• | an effective fixed interest rate of 6.12% from June 2005 to July 2010 on $100.0 million of the Term Loan B. |
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Name | Age | Position | ||||
Jeffrey L. Turner | 55 | Director, President and Chief Executive Officer | ||||
Ulrich (Rick) Schmidt | 57 | Executive Vice President, Chief Financial Officer and Treasurer | ||||
Ronald C. Brunton | 59 | Executive Vice President and Chief Operating Officer | ||||
H. David Walker | 55 | Senior Vice President Sales and Marketing | ||||
Gloria Farha Flentje | 63 | Vice President, General Counsel and Secretary | ||||
John Lewelling | 46 | Senior Vice President, Strategy and Information Technology | ||||
Richard Buchanan | 56 | Vice President/General Manager of Fuselage Structures/Systems Business Unit | ||||
Michael G. King | 51 | Vice President/General Manager of the Propulsion Structures and Systems Business Unit | ||||
Neil McManus | 40 | Vice President and Managing Director, Spirit AeroSystems (Europe) Limited | ||||
Donald R. Carlisle | 54 | Vice President/General Manager of Aerostructures Business Unit | ||||
Ivor (Ike) Evans | 64 | Director | ||||
Paul Fulchino | 60 | Director | ||||
Richard Gephardt | 66 | Director | ||||
Robert Johnson | 59 | Director | ||||
Ronald Kadish | 58 | Director | ||||
Cornelius (Connie Mack) McGillicuddy, III | 66 | Director | ||||
Seth Mersky | 47 | Director | ||||
Francis Raborn | 63 | Director | ||||
Nigel Wright | 43 | Director |
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• | Jeffrey L. Turner, President and Chief Executive Officer | |
• | Ulrich (Rick) Schmidt, Executive Vice President and Chief Financial Officer | |
• | Ronald C. Brunton, Executive Vice President and Chief Operating Officer | |
• | John Lewelling, Senior Vice President, Strategy and Information Technology | |
• | Janet S. Nicolson, Senior Vice President of Human Resources |
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• | perquisites and other personal benefits, or property, unless the aggregate amount of such compensation is less than $10,000; | |
• | all“gross-ups” or other amounts reimbursed during the fiscal year for the payment of taxes, if any; | |
• | any Spirit Holdings security purchased (through deferral of salary or bonus, or otherwise) at a discount from the market price of such security at the date of purchase, unless that discount is available generally, either to all security holders or to all of our salaried employees; | |
• | amounts we paid or which became due related to termination, severance, or a change in control, if any; | |
• | our contributions to vested and unvested defined contribution plans; | |
• | any life insurance premiums we paid during the year for the benefit of a named executive officer; and | |
• | All other forms of compensation required to be reported but not reported in other columns of the “Summary Compensation Table for Fiscal Year 2006.” Disclosed here are cash payments to recruit named executive officers attributable to forgone compensation from previous employers. |
Change | ||||||||||||||||||||||||||||||||||||
in Pension | ||||||||||||||||||||||||||||||||||||
Non- | Value and | |||||||||||||||||||||||||||||||||||
Equity | Nonqualified | |||||||||||||||||||||||||||||||||||
Incentive | Deferred | |||||||||||||||||||||||||||||||||||
Stock | Option | Plan | Compensation | All Other | ||||||||||||||||||||||||||||||||
Salary | Bonus | Awards(6) | Awards | Compensation | Earnings | Compensation | Total | |||||||||||||||||||||||||||||
Name and Principal Position | Year | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | |||||||||||||||||||||||||||
Jeffrey L. Turner, | 2006 | 263,393 | 200,000 | (1) | 6,272,439 | — | 895,560 | 68,850 | (7) | 68,814 | (8) | 7,769,056 | ||||||||||||||||||||||||
President & CEO | ||||||||||||||||||||||||||||||||||||
Ulrich (Rick) Schmidt, | 2006 | 432,496 | 50,000 | (2) | 5,403,078 | — | 588,200 | — | 2,649,170 | (9) | 9,122,944 | |||||||||||||||||||||||||
EVP & CFO | ||||||||||||||||||||||||||||||||||||
John Lewelling, | 2006 | 315,868 | 300,000 | (3) | 2,181,670 | — | 382,500 | — | 1,632,344 | (10) | 4,812,382 | |||||||||||||||||||||||||
SVP of Strategy & IT | ||||||||||||||||||||||||||||||||||||
Janet S. Nicolson, | 2006 | 239,420 | 249,417 | (4) | 1,667,860 | — | 255,000 | — | 1,817,648 | (11) | 4,229,345 | |||||||||||||||||||||||||
SVP of HR | ||||||||||||||||||||||||||||||||||||
Ronald C. Brunton, | 2006 | 194,018 | 200,000 | (5) | 1,759,207 | — | 330,953 | — | 20,246 | (12) | 2,504,424 | |||||||||||||||||||||||||
EVP & COO |
(1) | Represents a discretionary bonus paid to Mr. Turner. | |
(2) | Represents a discretionary bonus paid to Mr. Schmidt. | |
(3) | Represents a one-time cash payment for a sign-on bonus paid to Mr. Lewelling. | |
(4) | Represents a one-time cash payment to Ms. Nicolson in lieu of reported forgone bonus from previous employer. | |
(5) | Represents a discretionary bonus paid to Mr. Brunton. | |
(6) | Represents the dollar amount recognized for financial statement reporting purposes with respect to fiscal year 2006 in accordance with SFAS 123(R), and includes amounts from awards granted in and prior to 2006. Additional information concerning our accounting for stock awards may be found in note 11 to the |
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consolidated financial statements for the twelve months ended December 31, 2006 and from February 7, 2005 (date of inception) through December 29, 2005 included in this prospectus. | ||
(7) | $68,434 represents the aggregate change in the actuarial present value of Mr. Turner’s interest under our Pension Value Plan, and $416 represents the above-market earnings on Mr. Turner’s interest under our Deferred Compensation Plan. | |
(8) | Includes (a) $38,987 for a car provided by us, (b) $625 for personal use of our aircraft and (c) $29,202 for contributions by us to defined contribution plans. | |
(9) | Includes (a) $4,121 for country club dues, (b) $239,702 for relocation expenses, (c) $22,711 for contributions by us to defined contribution plans and (d) $2,382,635 for a one-time payment in lieu of forgone executive compensation from a prior employer. | |
(10) | Includes (a) $245,349 for relocation expenses, (b) $1,224,165 for compensation cost of purchase of stock from Spirit Holdings at discount from fair market value, (c) $17,848 for contribution by us to defined contribution plans, and (d) $144,982 for payment of taxes for sign-on bonus. | |
(11) | Includes (a) $152,120 for relocation expenses, (b) $150 for an incidental recognition award, (c) $725,372 for compensation cost of purchase of stock from Spirit Holdings at discount from fair market value, (d) $14,996 for contribution by us to defined contribution plans, (e) $26,250 for contribution by us to non-qualified deferred compensation plans, (f) $517,000 for a one-time cash payment in lieu of reported forgone executive compensation from a previous employer and (g) $381,760 for payment of taxes for forgone executive compensation and a reported bonus from a previous employer. | |
(12) | Includes $20,246 for contribution by us to defined contribution plans. |
All | All | |||||||||||||||||||||||||||||||||||||||||||
Other | Other | |||||||||||||||||||||||||||||||||||||||||||
Stock | Option | Grant | ||||||||||||||||||||||||||||||||||||||||||
Awards: | Awards: | Exercise | Date Fair | |||||||||||||||||||||||||||||||||||||||||
Number of | Number | or Base | Value of | |||||||||||||||||||||||||||||||||||||||||
Estimated Possible Payouts | Estimated Future Payouts | Shares of | of Securities | Price of | Stock and | |||||||||||||||||||||||||||||||||||||||
Under Non-Equity Incentive Plan Awards(1) | Under Equity Incentive Plan Awards(2) | Stocks | Underlying | Option | Option | |||||||||||||||||||||||||||||||||||||||
Threshold | Target | Maximum | Threshold | Target | Maximum | or Units | Options | Awards | Awards | |||||||||||||||||||||||||||||||||||
Name | Grant Date | ($) | ($) | ($) | ($) | ($) | ($) | (#) | (#) | ($/sh) | ($) | |||||||||||||||||||||||||||||||||
Jeffrey L. Turner, | 2/17/2006 | — | — | — | 105,360 | 526,800 | 1,053,600 | — | — | — | 1,265,012 | |||||||||||||||||||||||||||||||||
President & CEO | N/A | 105,360 | 526,800 | 1,053,600 | — | — | — | — | — | N/A | ||||||||||||||||||||||||||||||||||
Ulrich (Rick) Schmidt, | 2/17/2006 | — | — | — | 69,200 | 346,000 | 692,000 | — | — | — | 497,098 | |||||||||||||||||||||||||||||||||
EVP & CFO | N/A | 69,200 | 346,000 | 692,000 | — | — | — | — | — | — | N/A | |||||||||||||||||||||||||||||||||
John Lewelling, | 2/20/2006 | — | — | — | — | — | — | 360,000 | (3) | — | — | 6,096,658 | ||||||||||||||||||||||||||||||||
SVP of Strategy & IT | N/A | 45,000 | 225,000 | 450,000 | — | — | — | — | — | — | N/A | |||||||||||||||||||||||||||||||||
Janet S. Nicolson, | 12/30/2005 | — | — | — | — | — | — | 240,000 | (4) | — | — | 3,701,488 | ||||||||||||||||||||||||||||||||
SVP of HR | N/A | 30,000 | 150,000 | 300,000 | — | — | — | — | — | — | N/A | |||||||||||||||||||||||||||||||||
Ronald C. Brunton, | 2/17/2006 | — | — | — | 40,000 | 200,000 | 400,000 | — | — | 415,065 | ||||||||||||||||||||||||||||||||||
EVP & COO | N/A | 40,000 | 200,000 | 400,000 | — | — | — | — | — | — | N/A |
(1) | 2006 STIP cash awards, paid in February 2007, were granted and earned in 2006. The actual cash awards for the named executive officers for 2006 are reported in the “Non-Equity Incentive Plan Compensation” column of the “Summary Compensation Table.” | |
(2) | The STIP restricted stock awards are denominated in dollars and then converted and paid in shares of class B common stock. We granted Mr. Turner 74,550 shares, we granted Mr. Schmidt 29,505 shares, and we granted Mr. Brunton 24,636 shares under the STIP in February 2006 for 2005 performance. | |
(3) | Represents matched shares granted by us under the EIP. On February 20, 2006, Mr. Lewelling purchased 90,000 shares of class B common stock and received 360,000 shares of class B common stock as afour-to-one match. |
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(4) | Represents matched shares granted by us under the EIP. On December 30, 2005, Ms. Nicolson purchased 60,000 shares of class B common stock and received 240,000 shares of class B common stock as afour-to-one match. |
Option Awards | Stock Awards | |||||||||||||||||||||||||||||||||||
Equity | ||||||||||||||||||||||||||||||||||||
Incentive | ||||||||||||||||||||||||||||||||||||
Equity | Plan | |||||||||||||||||||||||||||||||||||
Incentive | Awards: | |||||||||||||||||||||||||||||||||||
Plan | Market or | |||||||||||||||||||||||||||||||||||
Awards: | Payout | |||||||||||||||||||||||||||||||||||
Equity | Number | Value of | ||||||||||||||||||||||||||||||||||
Incentive | of | Unearned | ||||||||||||||||||||||||||||||||||
Plan | Unearned | Shares, | ||||||||||||||||||||||||||||||||||
Awards: | Shares, | Units or | ||||||||||||||||||||||||||||||||||
Number of | Number of | Number of | Number of | Market Value | Units or | Other | ||||||||||||||||||||||||||||||
Securities | Securities | Securities | Shares or | of Shares or | Other | Rights | ||||||||||||||||||||||||||||||
Underlying | Underlying | Underlying | Option | Units of | Units of Stock | Rights | That Have | |||||||||||||||||||||||||||||
Unexercised | Unexercised | Unexercised | Exercise | Option | Stock That | That Have Not | That Have | Not | ||||||||||||||||||||||||||||
Options (#) | Options (#) | Unearned | Price | Expiration | Have Not | Vested(1) | Not | Vested | ||||||||||||||||||||||||||||
Name | Exercisable | Unexercisable | Options (#) | ($) | Date | Vested (#) | ($) | Vested (#) | ($) | |||||||||||||||||||||||||||
Jeffrey L. Turner, President & CEO | — | — | — | — | — | 896,516 | 30,006,391 | — | — | |||||||||||||||||||||||||||
Ulrich (Rick) Schmidt, EVP & CFO | — | — | — | — | — | 714,477 | 23,913,545 | — | — | |||||||||||||||||||||||||||
John Lewelling, SVP of Strategy & IT | — | — | — | — | — | 205,492 | 6,877,817 | — | — | |||||||||||||||||||||||||||
Janet S. Nicolson, SVP of HR | — | — | — | — | — | 136,994 | 4,585,189 | — | — | |||||||||||||||||||||||||||
Ronald C. Brunton, EVP & COO | — | — | — | — | — | 230,128 | 7,702,384 | — | — |
(1) | Market value calculated by multiplying the number of shares by $33.47, the closing price per share of Spirit Holdings’ class A common stock on the last trading day of Spirit Holdings’ 2006 fiscal year. Upon vesting, shares of class B common stock are convertible into shares of class A common stock on aone-for-one basis. |
Option Awards | Stock Awards | |||||||||||||||
Number | Number | |||||||||||||||
of Shares | Value | of Shares | Value | |||||||||||||
Acquired on | Realized on | Acquired on | Realized on | |||||||||||||
Exercise | Exercise | Vesting | Vesting(1) | |||||||||||||
Name | (#) | ($) | (#) | ($) | ||||||||||||
Jeffrey L. Turner, President & CEO | — | — | 618,034 | 16,068,884 | ||||||||||||
Ulrich (Rick) Schmidt, EVP & CFO | — | — | 515,028 | 13,390,728 | ||||||||||||
John Lewelling, SVP of Strategy & IT | — | — | 154,508 | 4,017,208 | ||||||||||||
Janet S. Nicolson, SVP of HR | 103,006 | 2,678,156 | ||||||||||||||
Ronald C. Brunton, EVP & COO | — | — | 154,508 | 4,107,208 |
(1) | Each share of restricted stock vested on November 27, 2006, at $26.00, the price paid by the public in Spirit Holdings’ initial public offering. |
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Number of | Present Value | |||||||||||||||
Years | of | Payment | ||||||||||||||
Credited | Accumulated | During Last | ||||||||||||||
Service | Benefit | Fiscal Year | ||||||||||||||
Name | Plan Name | (#) | ($) | ($) | ||||||||||||
Jeffrey L. Turner, President & CEO | Pension Value Plan | 29.6715 | (1) | 784,939 | 0 | |||||||||||
Ulrich (Rick) Schmidt, EVP & CFO | — | — | — | — | ||||||||||||
John Lewelling, SVP of Strategy & IT | — | — | — | — | ||||||||||||
Janet S. Nicolson, SVP of HR | — | — | — | — | ||||||||||||
Ronald C. Brunton, EVP & COO | — | — | — | — |
(1) | As reported by Boeing under a Boeing qualified plan, and includes service with Boeing. See narrative below. |
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Executive | Registrant | Aggregate | Aggregate | Aggregate | ||||||||||||||||
Contributions | Contributions | Earnings in | Withdraws/ | Balance at | ||||||||||||||||
in Last FY | in Last FY | Last FY | Distributions | Last FYE | ||||||||||||||||
Name | ($) | ($) | ($) | ($) | ($) | |||||||||||||||
Jeffrey L. Turner, President & CEO | — | — | 5,197 | 0 | 95,685 | |||||||||||||||
Ulrich (Rick) Schmidt, EVP & CFO | — | — | — | — | — | |||||||||||||||
John Lewelling, SVP of Strategy & IT | — | — | — | — | — | |||||||||||||||
Janet S. Nicolson, SVP of HR | — | 26,250 | 0 | (1) | 0 | 26,250 | ||||||||||||||
Ronald C. Brunton, EVP & COO | — | — | — | — | — |
(1) | Contribution for Ms. Nicolson was made effective on the last day of the 2006 fiscal year. |
• | Voluntary Termination by the Executive. In the event of voluntary termination by the executive, payment of one-half of the bonus that otherwise would have been payable pursuant to the STIP will be |
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made (pro-rated for a partial year). Salary and benefits are continued only through the date of termination. |
• | Involuntary Termination by Spirit for Cause. In the event of involuntary termination by Spirit for cause, no amounts are payable by reason of termination, other than salary and benefits payable through the date of termination. Generally, each of the named executive officers’ employment agreements define termination for “cause” to mean (1) the executive committing a material breach of his or her employment agreement or acts involving moral turpitude, including fraud, dishonesty, disclosure of confidential information, or the commission of a felony, or direct and deliberate acts constituting a material breach of his or her duty of loyalty to Spirit; (2) the executive willfully or continuously refusing to or willfully failing to perform the material duties reasonably assigned to him by the Board that are consistent with the provisions of his or her employment agreement where the refusal or failure does not result from a disability (as discussed below); or (3) the inability of the executive to obtain and maintain appropriate United States security clearances. Messrs. Turner’s and Schmidt’s employment agreements state that their termination is not deemed to be for cause unless and until there shall have been delivered to the executive a copy of a resolution, duly adopted by the Board. Although Mr. Schmidt’s employment agreement requires that he seek to obtain and maintain appropriate United States security clearance, the termination of Mr. Schmidt’s employment agreement for his failure to do so (without regard to any underlying facts for such failure) would constitute a termination without cause. | |
• | Expiration of Employment Agreement or Involuntary Termination by Spirit without Cause. In the event employment terminates due to expiration of the employment agreement or involuntary termination by Spirit without cause, base salary generally will be continued for 24 months. In addition, a bonus payment will be made pursuant to the STIP equal to the full amount of the bonus that otherwise would have been payable under the STIP (if any) for the year of termination, and a bonus payment will be made pursuant to the STIP for each subsequent year (pro-rated for any partial year) during which salary continuation payments are made (with such payments determined on the assumption that target performance is achieved for such years). Medical benefits will be continued during the period that salary continuation payments are made (subject to early termination in the event of new employment), with premiums paid by Spirit in the same proportion that premiums are paid on similar coverage for other executive officers. For Mr. Schmidt, life insurance benefits also will be continued in the event of involuntary termination without cause, with premiums paid by Spirit in the same proportion that premiums are paid for other executive officers. |
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• | Disability. In the event employment terminates due to disability, base salary, medical benefits, and life insurance benefits generally are continued until age 65. For this purpose, disability means the inability to render the services required under the employment agreement for a period of 180 days during any12-month period. In addition to the foregoing payments and benefits, upon termination of Mr. Schmidt’s employment due to disability, vesting is accelerated with respect to any shares of stock previously granted to Mr. Schmidt under the STIP, and he may be credited with additional years of service under the EIP (which may increase the portion of restricted shares in which he acquires an interest upon a future liquidity event). | |
• | Death. In the event employment terminates due to death, base salary will be continued for the remaining term of the agreement. In addition, a bonus payment will be made pursuant to the STIP equal to the full amount of the bonus that otherwise would have been payable under the STIP (if any) for the year of termination, and a bonus payment for one subsequent year will be made pursuant to the STIP (with such payment determined on the assumption that target performance is achieved for such year). In the event of Mr. Schmidt’s termination of employment due to death, medical benefits for Mr. Schmidt’s family generally will be continued during the period that base salary is continued, with premiums paid by Spirit in the same proportion that premiums are paid on similar coverage for other executive officers. |
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Termination | ||||||||||||||||||||||||
Upon | Involuntary | |||||||||||||||||||||||
Expiration of | Termination | Termination | ||||||||||||||||||||||
Voluntary | Termination | Employment | Without | Due to | Termination | |||||||||||||||||||
Termination | for Cause | Agreement | Cause | Disability | Due to Death | |||||||||||||||||||
Salary Continuation | — | — | $ | 526,800 | (4) | $ | 526,820 | (4) | $ | 2,502,300 | (7) | $ | 395,100 | (10) | ||||||||||
Future STIP Award | $ | 895,560 | (3) | — | $ | 3,898,320 | (5) | $ | 3,898,320 | (5) | — | $ | 2,844,720 | (11) | ||||||||||
Medical/Dental Insurance | — | — | $ | 14,568 | (6) | $ | 14,568 | (6) | $ | 69,198 | (8) | — | ||||||||||||
Life Insurance | — | — | — | — | $ | 6,954 | (9) | — | ||||||||||||||||
SERP (Phantom Stock)(1) | $ | 7,653,752 | $ | 7,653,752 | $ | 7,653,752 | $ | 7,653,752 | $ | 7,653,752 | $ | 7,653,752 | ||||||||||||
DCP — Employee(2) | $ | 95,685 | $ | 95,685 | $ | 95,685 | $ | 95,685 | $ | 95,685 | $ | 95,685 |
(1) | 228,675 phantom stock units multiplied by $33.47 (the closing price for Spirit Holdings’ class A common stock on the NYSE on December 29, 2006). | |
(2) | Account balance as of December 31, 2006. | |
(3) | One-half of the 2006 STIP award ($1,791,120, including both cash and stock portions). | |
(4) | Base salary of $263,400 for 24 months. | |
(5) | 100% of 2006 STIP award ($1,791,120), plus 2 additional years at target performance (400% of $263,400 base salary each year). | |
(6) | Monthly contribution by us toward medical coverage ($607) for 24 months. | |
(7) | Base salary ($263,400) continued to age 65 (91/2 years). | |
(8) | Monthly contribution by us toward medical coverage ($607) continued to age 65 (91/2 years). | |
(9) | Monthly contribution by us toward life insurance coverage ($61) continued to age 65 (91/2 years). | |
(10) | Base salary ($263,400) continued to June 15, 2008 (11/2 years). | |
(11) | 100% of 2006 STIP award ($1,791,120), plus 1 additional year at target performance (400% of $263,400 base salary). |
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Termination | ||||||||||||||||||||||||
Upon | Involuntary | |||||||||||||||||||||||
Expiration of | Termination | Termination | ||||||||||||||||||||||
Voluntary | Termination | Employment | Without | Due to | Termination | |||||||||||||||||||
Termination | for Cause | Agreement | Cause | Disability | Due to Death | |||||||||||||||||||
Salary Continuation | — | — | $ | 865,000 | (2) | $ | 865,000 | (2) | $ | 3,460,000 | (6) | $ | 722,275 | (9) | ||||||||||
Future STIP Award | $ | 588,200 | (1) | — | $ | 2,560,400 | (3) | $ | 2,560,400 | (3) | — | $ | 1,868,400 | (10) | ||||||||||
Medical/Dental Insurance | — | — | $ | 15,912 | (4) | $ | 15,912 | (4) | $ | 63,648 | (7) | $ | 13,260 | (11) | ||||||||||
Life Insurance | — | — | — | $ | 2,400 | (5) | $ | 9,600 | (8) | — |
(1) | One-half of the 2006 STIP award ($1,176,400, including both cash and stock portions). | |
(2) | Base salary of $432,500 for 24 months. | |
(3) | 100% of 2006 STIP award ($1,176,400), plus 2 additional years at target performance (160% of $432,500 base salary each year). | |
(4) | Monthly contribution by us toward medical coverage ($663) for 24 months. | |
(5) | Monthly contribution by us toward life insurance coverage ($100) for 24 months. | |
(6) | Base salary ($432,500) continued to age 65 (8 years). | |
(7) | Monthly contribution by us toward medical coverage ($663) continued to age 65 (8 years). | |
(8) | Monthly contribution by us toward life insurance coverage ($100) continued to age 65 (8 years). | |
(9) | Base salary ($432,500) continued to September 1, 2008 (1.67 years). | |
(10) | 100% of 2006 STIP award ($1,176,400), plus 1 additional year at target performance (160% of $432,500 base salary). | |
(11) | Monthly contribution by us toward family medical coverage ($663) continued to September 1, 2008 (20 months). |
Involuntary | ||||||||||||
Termination | Termination | Other | ||||||||||
for Cause | Without Cause | Terminations | ||||||||||
Salary Continuation | — | $ | 375,000 | (1) | — | |||||||
Medical/Dental Insurance | — | $ | 14,902 | (2) | — |
(1) | Base salary ($375,000) continued for 12 months. | |
(2) | Full monthly cost of COBRA medical and dental coverage ($1,102 medical plus $140 dental) continued for 12 months. |
Involuntary | ||||||||||||
Termination | Termination | Other | ||||||||||
for Cause | Without Cause | Terminations | ||||||||||
Salary Continuation | — | $ | 250,000 | (2) | — | |||||||
Medical/Dental Insurance | — | $ | 13,032 | (3) | — | |||||||
DCP — Employee(1) | — | $ | 26,250 | $ | 26,250 |
(1) | Account balance as of December 31, 2006. | |
(2) | Base salary ($250,000) continued for 12 months. | |
(3) | Full monthly cost of COBRA medical and dental coverage ($993 medical plus $93 dental) continued for 12 months. |
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• | For each participant employed on the date of the “Change in Control” who either is not offered continued employment in a comparable position or continues employment after the “Change in Control” but, within 12 months, is either involuntarily terminated without cause or is assigned to a position that is not a comparable position, the service factor is deemed fully satisfied upon future liquidity events. |
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• | For each participant employed on the date of the “Change in Control” who is offered a comparable position but declines to accept it, the service factor is not deemed fully satisfied upon future liquidity events, but a more accelerated schedule applies for purposes of determining the extent to which the service factor has been satisfied. |
Employment | ||||||||||||
SERP | EIP | Agreement | ||||||||||
Jeffrey L. Turner | $ | 7,653,752 | (1) | $ | 27,511,202 | (2) | — | |||||
Ulrich (Rick) Schmidt | — | $ | 22,926,013 | (2) | $ | 3,443,712 | (3) | |||||
John A. Lewelling | — | $ | 6,877,817 | (2) | — | |||||||
Janet S. Nicolson | — | $ | 4,585,189 | (2) | — | |||||||
Ronald C. Brunton | $ | 6,877,817 | (2) | — |
(1) | 228,675 phantom stock units multiplied by $33.47 (the closing price for Spirit Holdings’ class A common stock on the NYSE on December 29, 2006). | |
(2) | Number of restricted shares multiplied by per share value. Assumes all remaining equity interest in Spirit Holdings held by the Onex entities is disposed of in a transaction occurring as of December 31, 2006, and “Return on Invested Capital” equals or exceeds 26%. Therefore, EIP participants acquire an interest in all remaining shares of restricted stock. Value per share of restricted stock assumed to be $33.47 (the closing price for Spirit Holdings’ class A common stock on the NYSE on December 29, 2006). | |
(3) | Sum of amounts payable in connection with involuntary termination without cause. |
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Change in | ||||||||||||||||||||||||||||
Pension Value | ||||||||||||||||||||||||||||
and Nonqualified | ||||||||||||||||||||||||||||
Fees Earned | Stock | Non-Equity | Deferred | |||||||||||||||||||||||||
or Paid in | Awards | Option | Incentive Plan | Compensation | All Other | |||||||||||||||||||||||
Cash | (1) | Awards | Compensation | Earnings | Compensation | Total | ||||||||||||||||||||||
Name | ($) | ($) | ($) | ($) | ($) | ($) | ($) | |||||||||||||||||||||
Ivor Evans | 106,000 | 646,298 | — | — | — | — | 752,298 | |||||||||||||||||||||
Paul Fulchino | 100,000 | 646,298 | — | — | — | — | 746,298 | |||||||||||||||||||||
Richard Gephardt | 95,000 | 1,723,462 | — | — | — | — | 1,818,462 | |||||||||||||||||||||
Robert Johnson | 138,000 | 646,298 | — | — | — | — | 784,298 | |||||||||||||||||||||
Ronald Kadish | 105,000 | 646,298 | — | — | — | — | 751,298 | |||||||||||||||||||||
Cornelius McGillicuddy III | 100,000 | 646,298 | — | — | — | — | 746,298 | |||||||||||||||||||||
Seth Mersky | — | — | — | — | — | — | — | |||||||||||||||||||||
Francis Raborn | 123,000 | 646,298 | — | — | — | — | 769,298 | |||||||||||||||||||||
Nigel Wright | — | — | — | — | — | — | — |
(1) | Represents the dollar amount recognized for financial statement reporting purposes with respect to fiscal year 2006 in accordance with SFAS 123(R), and thus includes amounts from awards granted prior to 2006. Additional information concerning our accounting for stock awards may be found in note 11 to our consolidated financial statements for the twelve months ended December 31, 2006 and from February 7, 2005 (date of inception) through December 29, 2005 included in this prospectus. |
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• | information about the goods or services proposed to be or being provided by or to the related party or the nature of the transactions; | |
• | the nature of the transactions and the costs to be incurred by us or payments to us; | |
• | an analysis of the costs and benefits associated with the transaction and a comparison of comparable or alternative goods or services that are available to us from unrelated parties; | |
• | the business advantage we would gain by engaging in the transaction; and | |
• | an analysis of the significance of the transaction to us and to the related party. |
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Aggregate | ||||||||||||||
Number | Aggregate | Value of Shares | Dates | |||||||||||
Name | of Shares(1) | Purchase Price | upon Issuance(2) | of Issuance | ||||||||||
Jeffrey Turner | 74,550 | — | $ | 1,256,168 | February 17, 2006 | |||||||||
29,373 | — | $ | 882,659 | February 22, 2007 | ||||||||||
Rick Schmidt | 29,505 | — | $ | 497,159 | February 17, 2006 | |||||||||
19,292 | — | $ | 579,725 | February 22, 2007 | ||||||||||
Ronald C. Brunton | 24,636 | — | $ | 415,117 | February 17, 2006 | |||||||||
10,855 | — | $ | 326,193 | February 22, 2007 | ||||||||||
H. David Walker | 15,651 | — | $ | 263,719 | February 17, 2006 | |||||||||
6,691 | — | $ | 201,065 | February 22, 2007 | ||||||||||
Gloria Farha Flentje | 9,108 | — | $ | 153,470 | February 17, 2006 | |||||||||
3,662 | — | $ | 110,043 | February 22, 2007 | ||||||||||
Janet S. Nicolson(3) | 300,000 | $ | 200,000 | $ | 4,626,860 | December 30, 2005 | ||||||||
John Lewelling | 450,000 | $ | 300,000 | $ | 7,620,823 | February 20, 2006 | ||||||||
12,546 | — | $ | 377,007 | February 22, 2007 | ||||||||||
Richard Buchanan | 12,642 | — | $ | 213,018 | February 17, 2006 | |||||||||
5,410 | — | $ | 162,571 | February 22, 2007 | ||||||||||
Michael King | 12,159 | — | $ | 204,879 | February 17, 2006 | |||||||||
5,131 | — | $ | 154,187 | February 22, 2007 | ||||||||||
Neil McManus | 90,750 | $ | 139,150 | $ | 1,961,784 | July 31, 2006 | ||||||||
4,620 | — | $ | 138,831 | February 22, 2007 | ||||||||||
Donald Carlisle | 12,600 | — | $ | 212,310 | February 17, 2006 | |||||||||
5,406 | — | $ | 162,450 | February 22, 2007 |
(1) | Includes shares of class B common stock which are subject to vesting requirements under our benefit plans. Share numbers give effect to the3-for-1 stock split of our common stock that occurred on November 16, 2006. | |
(2) | As determined in accordance with SFAS No. 123(R). | |
(3) | Ms. Nicolson served as the Senior Vice President of Human Resources of Spirit Holdings at the time of purchase and grant. |
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• | each person known by us to own beneficially 5% or more of our class A or class B common stock, | |
• | each of our directors; | |
• | each of our named executive officers; | |
• | all of our directors and executive officers as a group; and | |
• | each selling stockholder. |
Shares Being Sold in Offering | ||||||||||||||||||||||||||||||||||||||||||||
Assuming the | Shares Beneficially Owned After Offering | |||||||||||||||||||||||||||||||||||||||||||
Before Offering | Underwriters | Assuming the Underwriters’ Over-Allotment | Assuming the Underwriters’ Over-Allotment | |||||||||||||||||||||||||||||||||||||||||
Number of | Assuming the | Over- | Option is Not Exercised | Option is Exercised in Full | ||||||||||||||||||||||||||||||||||||||||
Shares | Underwriters | Allotment | Percentage of | Percentage of | ||||||||||||||||||||||||||||||||||||||||
Beneficially | Percentage of | Percentage | Over-Allotment | Option is | Class/All | Percentage | Class/All | Percentage | ||||||||||||||||||||||||||||||||||||
Owned(1) | Class/All | of Voting | Option is Not | Exercised in | Number of | Common | of Voting | Number of | Common | of Voting | ||||||||||||||||||||||||||||||||||
Name of Beneficial Owner | (2)(3) | Common Stock | Power | Exercised | Full | Shares | Stock | Power | Shares | Stock | Power | |||||||||||||||||||||||||||||||||
Five Percent Stockholders | ||||||||||||||||||||||||||||||||||||||||||||
Onex Corporation(4) | 64,215,729 | 97.7 | %/48.0% | 88.5 | % | |||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
Onex Partners LP(5) | 36,054,787 | 54.8 | %/26.9% | 49.7 | % | |||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
OAH Wind LLC(6) | 17,048,438 | 25.9 | %/12.7% | 23.5 | % | |||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
Onex Spirit Co-Invest LP(7) | 9,694,068 | 14.7 | %/7.2% | 13.4 | % | |||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
AXA Financial, Inc. | 7,359,225 | 10.8 | %/5.5% | 1.0 | % | |||||||||||||||||||||||||||||||||||||||
class A | ||||||||||||||||||||||||||||||||||||||||||||
JGD Management Corp | 3,511,962 | 5.2 | %/2.6% | * | ||||||||||||||||||||||||||||||||||||||||
c/o York Capital Management | class A | |||||||||||||||||||||||||||||||||||||||||||
AMVESCAP PLC | 6,593,766 | 9.7 | %/4.9% | * | ||||||||||||||||||||||||||||||||||||||||
class A | ||||||||||||||||||||||||||||||||||||||||||||
Directors and Executive Officers | ||||||||||||||||||||||||||||||||||||||||||||
Jeffrey Turner(8)(9) | 149,506 | */* | * | |||||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
Ulrich Schmidt(8)(9)(10) | 200,743 | */* | * | |||||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
Ronald C. Brunton(8)(9) | 76,007 | */* | * | |||||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
John Lewelling(8)(9) | 51,371 | */* | * | |||||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
Janet Nicolson(8)(9) | 34,247 | */* | * | |||||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
Ivor Evans(8)(9) | — | */* | * | |||||||||||||||||||||||||||||||||||||||||
Paul Fulchino(8)(9) | — | */* | * | |||||||||||||||||||||||||||||||||||||||||
Richard Gephardt(8)(9) | 51,503 | */* | * | |||||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
Robert Johnson(8)(9) | — | */* | * | |||||||||||||||||||||||||||||||||||||||||
Ronald Kadish(8)(9) | — | */* | * | |||||||||||||||||||||||||||||||||||||||||
Cornelius McGillicuddy, III(8)(9) | — | */* | * | |||||||||||||||||||||||||||||||||||||||||
Seth Mersky(11) | 68,788 | */* | * | |||||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
Francis Raborn(8)(9) | 19,314 | */* | * | |||||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
Nigel Wright(12) | 132,522 | */* | * | |||||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
All directors and executive officers as a group (19 persons)(9)(10) (11)(12) | 1,174,416 | 1.8 | %/* | 1.6 | % | |||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
Other Selling Stockholders | ||||||||||||||||||||||||||||||||||||||||||||
Wind EI II LLC(13) | 1,050,811 | 1.6 | %/* | 1.4 | % | |||||||||||||||||||||||||||||||||||||||
class B | ||||||||||||||||||||||||||||||||||||||||||||
Onex US Principals LP(14) | 367,625 | */* | * | |||||||||||||||||||||||||||||||||||||||||
class B |
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* | Represents beneficial ownership of less than 1%. | |
(1) | The amounts and percentages of our common stock beneficially owned are reported on the basis of regulations of the SEC governing the determination of beneficial ownership of securities. Under the rules of the SEC, a person is deemed to be a “beneficial owner” of a security if that person has or shares “voting power,” which includes the power to vote or direct the voting of such security, or “investment power,” which includes the power to dispose of or to direct the disposition of such security. A person is also deemed to be a beneficial owner of any securities of which that person has a right to acquire beneficial ownership within 60 days. Under these rules, more than one person may be deemed to be a beneficial owner of such securities as to which such person has an economic interest. | |
(2) | On each matter submitted to the stockholders for their vote, our class A common stock is entitled to one vote per share and our class B common stock is entitled to ten votes per share, reducing to one vote per share under certain limited circumstances. Except as required by law, our class A and class B common stock vote together on all matters submitted to stockholders for their vote. | |
(3) | Each share of class B common stock may be converted at any time at the option of the holder into one share of class A common stock. Accordingly, each beneficial owner of shares of class B common stock is deemed the beneficial owner of the same number of shares of class A common stock. See “Description of Capital Stock — Common Stock — Conversion Rights.” | |
(4) | All columns include the following: (i) shares of class B common stock held by Onex Partners LP; (ii) shares of class B common stock held by OAH Wind LLC; (iii) shares of class B common stock held by Wind EI II LLC; (iv) shares of class B common stock held by Onex US Principals LP; and (v) shares of class B common stock held by Onex Spirit Co-Invest LP. Onex Corporation may be deemed to own beneficially the shares of class B common stock held by (a) Onex Partners LP, through Onex Corporation’s ownership of all of the common stock of Onex Partners GP Inc., the general partner of Onex Partners GP LP, the general partner of Onex Partners LP; (b) OAH Wind LLC, through Onex Corporation’s ownership of all of the equity of Onex American Holdings II LLC which owns all of the equity of Onex American Holdings Subco LLC, which owns all of the equity of OAH Wind LLC; (c) Wind EI II LLC, through Onex Corporation’s ownership of Onex American Holdings II LLC which owns all of the voting power of Wind Executive Investco LLC, which owns all of the equity of Wind EI II LLC; (d) Onex US Principals LP through Onex Corporation’s ownership of all of the equity of Onex American Holdings II LLC which owns all of the equity of Onex American Holdings GP LLC, the general partner of Onex US Principals LP and (e) Onex Spirit Co-Invest LP, through Onex Corporation’s ownership of all of the common stock of Onex Partners GP Inc., the general partner of Onex Partners GP LP, the general partner of Onex Spirit Co-Invest LP. Mr. Gerald W. Schwartz, the Chairman, President and Chief Executive Officer of Onex Corporation, owns shares representing a majority of the voting rights of the shares of Onex Corporation and as such has votingand/or investment power with respect to, and accordingly may be deemed to own beneficially, all of the shares of our class B common stock owned beneficially by Onex Corporation. Mr. Schwartz disclaims such beneficial ownership. The address for Onex Corporation is 161 Bay Street, Toronto, Ontario M5J 2S1, Canada. | |
(5) | All of the shares of class B common stock owned by Onex Partners LP may be deemed owned beneficially by each of Onex Partners GP LP, Onex Partners GP Inc. and Onex Corporation. The address for Onex Partners LP is c/o Onex Investment Corporation, 712 Fifth Avenue, New York, New York 10019. | |
(6) | All of the shares of class B common stock owned by OAH Wind LLC may be deemed owned beneficially by each of Onex American Holdings Subco LLC, Onex American Holdings II LLC and Onex Corporation. The address for OAH Wind LLC is 421 Leader Street, Marion, Ohio 43302. | |
(7) | All of the shares of class B common stock owned by Onex Spirit Co-Invest LP may be deemed owned beneficially by each of Onex Partners GP LP, Onex Partners GP Inc. and Onex Corporation. The address for Onex Spirit Co-Invest LP isc/o Onex Investment Corporation, 712 Fifth Avenue, New York, New York 10019. | |
(8) | The address of these stockholders is c/o Spirit AeroSystems Holdings, Inc., 3801 South Oliver, Wichita, Kansas 67210. |
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(9) | Number of Shares Beneficially Owned Before Offering includes shares of class B common stock granted between June 16, 2005 and July 31, 2006 to members of our management or our board of directors under our Executive Incentive Plan or Director Stock Plan, in transactions which were exempt from registration pursuant to Section 4(2), Rule 506 or Rule 701 under the Securities Act and which vested or will vest prior to the consummation of this offering. Number of Shares Beneficially Owned Before Offering excludes shares of class B common stock which may vest under our Executive Incentive Plan or our Director Stock Plan on the consummation of this offering. All columns exclude shares of class B common stock which will remain subject to vesting under our Executive Incentive Plan following the consummation of this offering. See “Management — Compensation ofNon-Management Directors” in our Definitive Proxy Statement on Form 14A filed with the SEC on April 9, 2007 and incorporated herein by reference. | |
(10) | Represents or includes shares of class B common stock owned by Ulrich Schmidt, as Trustee of the Ulrich Schmidt Revocable Trust, which may be deemed to be beneficially owned by Ulrich Schmidt. | |
(11) | All columns include (i) shares of class B common stock owned by Onex Partners LP which may be deemed beneficially owned by Mr. Mersky by reason of his pecuniary interest in Onex Partners LP and (ii) shares of class B common stock owned by Onex Spirit Co-Invest LP which may be deemed beneficially owned by Mr. Mersky by reason of his pecuniary interest in Onex Spirit Co-Invest LP. Number of Shares Beneficially Owned Before Offering excludes shares of class B common stock owned by Onex US Principals LP in which Mr. Mersky may acquire an economic interest upon consummation of this offering pursuant to certain management incentive plans of Onex. All columns exclude shares of class B common stock owned by Onex U.S. Principals LP in which Mr. Mersky may acquire an economic interest following this offering subject to further vesting requirements pursuant to certain management incentive plans of Onex. Mr. Mersky disclaims beneficial ownership of the shares of class B common stock owned by Onex Partners LP, Onex Spirit Co-Invest LP and Onex US Principals LP. Mr. Mersky’s address is c/o Onex Corporation, 161 Bay Street, Toronto, Ontario, M5J 2S1, Canada. | |
(12) | All columns include (i) shares of class B common stock owned by Onex Partners LP which may be deemed beneficially owned by Mr. Wright by reason of his pecuniary interest in Onex Partners LP and (ii) shares of class B common stock owned by Onex Spirit Co-Invest LP which may be deemed beneficially owned by Mr. Wright by reason of his pecuniary interest in Onex Spirit Co-Invest LP. Number of Shares Beneficially Owned Before Offering excludes shares of class B common stock owned by Wind EI II LLC in which Mr. Wright may acquire an economic interest upon consummation of this offering pursuant to certain management incentive plans of Onex. All columns exclude shares of class B common stock owned by Wind EI II LLC in which Mr. Wright may acquire an economic interest following this offering subject to further vesting requirements pursuant to certain management incentive plans of Onex. Mr. Wright disclaims beneficial ownership of the shares of class B common stock owned by Onex Partners LP, Onex Spirit Co-Invest LP and Wind EI II LLC. Mr. Wright’s address is c/o Onex Corporation, 161 Bay Street, Toronto, Ontario, M5J 2S1, Canada. | |
(13) | All of the shares of class B common stock owned by Wind EI II LLC may be deemed owned beneficially by each of Onex American Holdings II LLC, Wind Executive Investco LLC and Onex Corporation. The address for Wind EI II LLC isc/o Onex Investment Corporation, 712 Fifth Avenue, New York, New York 10019. | |
(14) | All of the shares of class B common stock owned by Onex US Principals LP may be deemed owned beneficially by each of Onex American Holdings GP LLC, Onex American Holdings II LLC and Onex Corporation. The address for Onex US Principals LP is 421 Leader Street, Marion, Ohio 43302. |
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• | 200,000,000 shares of class A common stock, par value $0.01 per share, | |
• | 150,000,000 shares of class B common stock, par value $0.01 per share, and | |
• | 10,000,000 shares of preferred stock, par value $0.01 per share. |
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• | any breach of the director’s duty of loyalty to us or our stockholders, | |
• | acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, | |
• | the payment of unlawful dividends and unlawful repurchase or redemption of our capital stock prohibited by the DGCL, and | |
• | any transaction from which the director derived any improper personal benefits. |
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• | a U.S. citizen or individual resident in the United States; | |
• | a corporation, or other entity treated as a corporation created or organized under the laws of the United States or any political subdivision thereof; | |
• | an estate the income of which is subject to U.S. federal income taxation regardless of its source; or | |
• | a trust (i) if a U.S. court can exercise primary supervision over the administration of such trust and one or more U.S. fiduciaries have the authority to control all of the substantial interests of such trust or (ii) that has a valid election in effect under applicable U.S. Treasury regulations to be treated as a United States person. |
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• | the gain is U.S. trade or business income, in which case such gain generally will be taxed in the same manner as gains of U.S. persons, and such gains may also be subject to the branch profits tax in the case of a corporateNon-U.S. Holder; | |
• | theNon-U.S. Holder is an individual who is present in the United States for more than 182 days in the taxable year of the disposition and who meets certain other requirements, in which case such holder generally will be subject to U.S. federal income tax at a rate of 30% (or a reduced rate under an applicable treaty) on the amount by which capital gains allocable to U.S. sources (including gains from the sale, exchange, retirement or other disposition of the common stock) exceed capital losses allocable to U.S. sources; or | |
• | we are or have been a “U.S. real property holding corporation” for U.S. federal income tax purposes at any time during the shorter of the five-year period ending on the date of disposition or the period that theNon-U.S. Holder held our common stock (the “applicable period”). |
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• | shares issuable upon conversion of our currently outstanding class B common stock will be eligible for sale beginning 90 days after the date of this prospectus subject to an extension in certain circumstances, and | |
• | shares held by our executive officers will be eligible for sale under Rule 144 commencing , 2007, or, if earlier, after the shares are registered under the Securities Act. |
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• | 1% of the number of shares of our class A common stock then outstanding, which will equal approximately shares immediately after this offering (approximately shares if the underwriters’ over-allotment option is exercised in full), and | |
• | the average weekly trading volume of our class A common stock during the four calendar weeks preceding the filing of the Form 144 with respect to such sale. |
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Underwriter | Number of Shares | |||
Credit Suisse Securities (USA) LLC. | ||||
Goldman, Sachs & Co. | ||||
Morgan Stanley & Co. Incorporated | ||||
Total |
Per Share | Total | |||||||||||||||
Without | With | Without | With | |||||||||||||
Over-allotment | Over-allotment | Over-allotment | Over-allotment | |||||||||||||
Expenses payable by us | $ | $ | $ | $ | ||||||||||||
Underwriting Discounts and Commissions paid by selling stockholders | $ | $ | $ | $ |
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• | the sale of shares to the underwriters; | |
• | shares acquired in the open market by a person other than us; | |
• | issuances by us pursuant to the conversion or exchange of convertible or exchangeable securities or the exercise of options or warrants, in each case outstanding on the date hereof; | |
• | grants by us of stock pursuant to the terms of a plan filed with the SEC prior to or as of the date hereof; | |
• | transfers of shares to a family member or trust of a non-Onex related stockholder, provided the transferee agrees to be bound by the restrictions in the immediately preceding paragraph and no filing by any party (transferor or transferee) under the Exchange Act will be required or will be voluntarily made in connection with such transfer (other than a filing pursuant to Section 13(d) or 13(g) or a filing on a Form 3, 4 or 5 after the expiration of thelock-up period); | |
• | transfers of shares to us upon the termination of the stockholder’s employment with us; | |
• | transfers or distributions of shares between Onex related entities, provided the transferee agrees to be bound by the restrictions in the immediately preceding paragraph and no filing by any party (transferor or transferee) under the Exchange Act will be required or will be voluntarily made in connection with such transfer (other than a filing pursuant to Section 13(d) or 13(g) of the Exchange Act or a filing on Form 3, 4 or 5 under the Exchange Act); or |
• | Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum. | |
• | Over-allotment involves sales by the underwriters of shares in excess of the number of shares the underwriters are obligated to purchase, which creates a syndicate short position. The short position may be either a covered short position or a naked short position. In a covered short position, the number of shares over-allotted by the underwriters is not greater than the number of shares that they may purchase in the over-allotment option. In a naked short position, the number of shares involved is greater than |
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the number of shares in the over-allotment option. The underwriters may close out any covered short position by either exercising their over-allotment optionand/or purchasing shares in the open market. |
• | Syndicate covering transactions involve purchases of the class A common stock in the open market after the distribution has been completed in order to cover syndicate short positions. In determining the source of shares to close out the short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase shares through the over-allotment option. If the underwriters sell more shares than could be covered by the over-allotment option, resulting in a naked short position, the position can only be closed out by buying shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there could be downward pressure on the price of the shares in the open market after pricing that could adversely affect investors who purchase in the offering. | |
• | Penalty bids permit the representatives to reclaim a selling concession from a syndicate member when the class A common stock originally sold by the syndicate member is purchased in a stabilizing or syndicate covering transaction to cover syndicate short positions. | |
• | In passive market making, market makers in the class A common stock who are underwriters or prospective underwriters may, subject to limitations, make bids for or purchases of our class A common stock until the time, if any, at which a stabilizing bid is made. |
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• | the purchaser is entitled under applicable provincial securities laws to purchase shares of class A common stock without the benefit of a prospectus qualified under those securities laws, | |
• | where required by law, that the purchaser is purchasing as principal and not as agent, | |
• | the purchaser has reviewed the text above under Resale Restrictions, and | |
• | the purchaser acknowledges and consents to the provision of specified information concerning its purchase of the shares of the class A common stock to the regulatory authority that by law is entitled to collect the information. |
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• | Annual Report onForm 10-K for the fiscal year ended December 31, 2006, filed on March 5, 2007; | |
• | Quarterly Report onForm 10-Q for the fiscal quarter ended March 29, 2007, filed on May 7, 2007; | |
• | Current Report onForm 8-K, filed on February 12, 2007; and | |
• | Definitive proxy statement for our annual meeting of stockholders filed on April 9, 2007. |
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Page | ||||
Consolidated Financial Statements of Spirit AeroSystems Holdings, Inc. for the twelve months ended December 31, 2006 and from February 7, 2005 (date of inception) through December 29, 2005 | ||||
Report of Independent Registered Public Accounting Firm | F-2 | |||
Consolidated Statements of Income (Loss) | F-3 | |||
Consolidated Balance Sheets | F-4 | |||
Consolidated Statements of Shareholders’ Equity | F-5 | |||
Consolidated Statements of Cash Flows | F-6 | |||
Notes to Consolidated Financial Statements | F-7-F-47 | |||
Condensed Consolidated Financial Statements of Spirit AeroSystems Holdings, Inc. for the three months ended March 29, 2007 (unaudited) | ||||
Condensed Consolidated Statement of Operations for the three months ended March 29, 2007 (unaudited) and March 30, 2006 (unaudited) | F-48 | |||
Condensed Consolidated Balance Sheets at March 29, 2007 (unaudited) and December 31, 2006 (unaudited) | F-49 | |||
Condensed Consolidated Statements of Shareholders’ Equity at March 29, 2007 (unaudited) and December 31, 2006 (unaudited) | F-50 | |||
Condensed Consolidated Statements of Cash Flows for the three months ended March 29, 2007 (unaudited) March 30, 2006 (unaudited) | F-51 | |||
Notes to Condensed Consolidated Financial Statements (unaudited) | F-52-F-65 | |||
Financial Statements of Wichita Division (a business unit of The Boeing Company) | ||||
Report of Independent Registered Public Accounting Firm | F-66 | |||
Statement of Assets and Liabilities as of June 16, 2005 and December 31, 2004 | F-67 | |||
Statements of Cost Center Activity for the period from January 1, 2005 through June 16, 2005 and the year ended December 31, 2004 | F-68 | |||
Notes to Financial Statements | F-69-F-80 |
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Period From | ||||||||
For the Twelve | June 17, 2005 | |||||||
Months Ended | through | |||||||
December 31, | December 29, | |||||||
2006 | 2005 | |||||||
($ in millions, except per share data) | ||||||||
Net revenues | $ | 3,207.7 | $ | 1,207.6 | ||||
Operating costs and expenses | ||||||||
Cost of sales | 2,934.3 | 1,056.4 | ||||||
Selling, general and administrative | 225.0 | 140.7 | ||||||
Research and development | 104.7 | 78.3 | ||||||
Total costs and expenses | 3,264.0 | 1,275.4 | ||||||
Operating loss | (56.3 | ) | (67.8 | ) | ||||
Interest expense and financing fee amortization | (50.1 | ) | (25.5 | ) | ||||
Interest income | 29.0 | 15.4 | ||||||
Other income, net | 5.9 | 1.3 | ||||||
Loss before income taxes | (71.5 | ) | (76.6 | ) | ||||
Income tax provision | 88.3 | (13.7 | ) | |||||
Net income (loss) | $ | 16.8 | $ | (90.3 | ) | |||
Earnings (loss) per share | ||||||||
Basic | $ | 0.15 | $ | (0.80 | ) | |||
Diluted | $ | 0.14 | $ | (0.80 | ) |
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December 31, 2006 | December 29, 2005 | |||||||
($ in millions) | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 184.3 | $ | 241.3 | ||||
Accounts receivable, net | 200.2 | 98.8 | ||||||
Other receivable | 43.0 | — | ||||||
Inventory, net | 882.2 | 510.7 | ||||||
Prepaids | 20.8 | 10.2 | ||||||
Income tax receivable | 21.7 | — | ||||||
Deferred tax asset-current | 68.3 | 1.1 | ||||||
Total current assets | 1,420.5 | 862.1 | ||||||
Property, plant and equipment, net | 773.8 | 518.8 | ||||||
Long-term receivable | 191.5 | 212.5 | ||||||
Pension assets | 207.3 | — | ||||||
Other assets | 129.1 | 63.2 | ||||||
Total assets | $ | 2,722.2 | $ | 1,656.6 | ||||
Current liabilities | ||||||||
Accounts payable | $ | 339.1 | $ | 173.7 | ||||
Accrued expenses | 170.0 | 125.6 | ||||||
Profit sharing/deferred compensation | 28.5 | — | ||||||
Current portion of long-term debt | 23.9 | 11.6 | ||||||
Deferred revenue | 8.2 | — | ||||||
Income taxes | — | 0.6 | ||||||
Total current liabilities | 569.7 | 311.5 | ||||||
Long-term debt | 594.3 | 710.0 | ||||||
Advance payments | 587.4 | 200.0 | ||||||
Other liabilities | 111.8 | 108.2 | ||||||
Deferred tax liability — non-current | — | 1.1 | ||||||
Shareholders’ equity | ||||||||
Preferred stock, par value $0.01, 10,000,000 shares authorized, no shares issued and outstanding | — | — | ||||||
Common stock, Class A par value $0.01, 200,000,000 shares authorized, 63,345,834 and no shares issued and outstanding, respectively | 0.6 | — | ||||||
Common stock, Class B par value $0.01, 150,000,000 shares authorized, 71,351,347 and 122,670,336 shares issued and outstanding, respectively | 0.7 | 1.2 | ||||||
Additional paid-in capital | 858.7 | 410.7 | ||||||
Accumulated other comprehensive income | 72.5 | 4.2 | ||||||
Accumulated deficit | (73.5 | ) | (90.3 | ) | ||||
Total shareholders’ equity | 859.0 | 325.8 | ||||||
Total liabilities and shareholders’ equity | $ | 2,722.2 | $ | 1,656.6 | ||||
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Accumulated | |||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||
Common Stock | Additional | Comprehensive | Accumulated | Comprehensive | |||||||||||||||||||||||||
Shares | Amount | Paid-in Capital | Income | Deficit | Total | Income/(Loss) | |||||||||||||||||||||||
( $ in millions) | |||||||||||||||||||||||||||||
Initial capitalization — February 7, 2005 | 100 | (1) | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||
Cancellation of Shares(1) | (100 | ) | — | — | |||||||||||||||||||||||||
Equity issuance to investors | 112,500,000 | 1.1 | 368.9 | 370.0 | |||||||||||||||||||||||||
Net loss | (90.3 | ) | (90.3 | ) | (90.3 | ) | |||||||||||||||||||||||
Unrealized gain on cash flow hedges | 4.2 | 4.2 | 4.2 | ||||||||||||||||||||||||||
Employee equity awards | 8,476,464 | 0.1 | 18.5 | 18.6 | |||||||||||||||||||||||||
Non-employee equity awards | 435,000 | — | 0.6 | 0.6 | |||||||||||||||||||||||||
Equity issuances to management | 1,258,872 | — | 13.7 | 13.7 | |||||||||||||||||||||||||
Supplemental executive retirement plan conversion | — | — | 9.0 | 9.0 | |||||||||||||||||||||||||
Balance — December 29, 2005 | 122,670,336 | 1.2 | 410.7 | 4.2 | (90.3 | ) | 325.8 | (86.1 | ) | ||||||||||||||||||||
Net income | 16.8 | 16.8 | 16.8 | ||||||||||||||||||||||||||
Pension valuation adjustment, net of tax | 40.0 | 40.0 | |||||||||||||||||||||||||||
Post-retirement benefit valuation adjustment, net of tax | 2.8 | 2.8 | |||||||||||||||||||||||||||
Unrealized gain on cash flow hedges, net of tax | 5.8 | 5.8 | 5.8 | ||||||||||||||||||||||||||
Employee equity awards | 1,381,131 | 51.1 | 51.1 | ||||||||||||||||||||||||||
UEP Stock | 125.7 | 125.7 | |||||||||||||||||||||||||||
Pool of windfall tax benefits | 15.3 | 15.3 | |||||||||||||||||||||||||||
Non-employee equity awards | — | — | 5.6 | 5.6 | |||||||||||||||||||||||||
Equity issuances — IPO, net of issuance costs | 10,416,667 | 0.1 | 249.2 | 249.3 | |||||||||||||||||||||||||
Equity issuances — Management | 229,047 | 1.1 | 1.1 | ||||||||||||||||||||||||||
Unrealized gain on currency translation adjustments, net of tax | — | — | — | 19.7 | 19.7 | 19.7 | |||||||||||||||||||||||
Balance — December 31, 2006 | 134,697,181 | $ | 1.3 | $ | 858.7 | $ | 72.5 | $ | (73.5 | ) | $ | 859.0 | $ | 42.3 | |||||||||||||||
(1) | Issued as common stock without designation as to class. Shares were cancelled as of June 16, 2005. |
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For the Twelve | Period From | |||||||
Months Ended | June 17, 2005 through | |||||||
December 31, | December 29, | |||||||
2006 | 2005 | |||||||
($ in millions) | ||||||||
Operating activities | ||||||||
Net income (loss) | $ | 16.8 | $ | (90.3 | ) | |||
Adjustments to reconcile net income (loss) to net cash provided by operating activities Depreciation expense | 52.8 | 28.6 | ||||||
Amortization expense | 12.0 | 3.3 | ||||||
Accretion of long-term receivable | (22.0 | ) | (9.7 | ) | ||||
Employee stock compensation expense | 182.3 | 34.7 | ||||||
Loss on disposition of assets | 0.9 | — | ||||||
Deferred taxes | (125.1 | ) | — | |||||
Income taxes payable | (7.9 | ) | 7.2 | |||||
Pension, net | (33.2 | ) | (8.9 | ) | ||||
Other | 13.1 | 14.0 | ||||||
Changes in assets and liabilities, net of acquisition | ||||||||
Accounts receivable | (41.9 | ) | (88.4 | ) | ||||
Inventory, net | (318.6 | ) | (31.4 | ) | ||||
Other current assets | (10.5 | ) | 1.3 | |||||
Accounts payable and accrued liabilities | 149.4 | 163.4 | ||||||
Profit sharing/deferred compensation | 5.5 | — | ||||||
Customer advance from Boeing | 400.0 | 200.0 | ||||||
Net cash provided by operating activities | 273.6 | 223.8 | ||||||
Investing Activities | ||||||||
Purchase of property, plant and equipment | (343.2 | ) | (144.6 | ) | ||||
Acquisition of business, net of cash acquired | (145.4 | ) | (885.7 | ) | ||||
Financial derivatives | 4.7 | — | ||||||
Transition payments | 10.0 | — | ||||||
Proceeds from sale of assets | 0.3 | — | ||||||
Net cash (used in) investing activities | (473.6 | ) | (1,030.3 | ) | ||||
Financing Activities | ||||||||
Proceeds from short-term debt | 85.0 | — | ||||||
Payments on short-term debt | (85.0 | ) | — | |||||
Proceeds from long-term debt | — | 700.0 | ||||||
Principal payments of debt | (124.0 | ) | (5.0 | ) | ||||
Debt issuance costs | (0.8 | ) | (21.4 | ) | ||||
Pool of windfall tax benefits | 15.3 | — | ||||||
Equity contributions from shareholders | — | 370.0 | ||||||
Proceeds from IPO, net of issuance costs | 249.3 | — | ||||||
Executive stock investments | 1.1 | 4.2 | ||||||
Net cash provided by financing activities | 140.9 | 1,047.8 | ||||||
Effect of exchange rate changes on cash and cash equivalents | 2.1 | — | ||||||
Net (decrease) increase in cash and cash equivalents for the period | (57.0 | ) | 241.3 | |||||
Cash and cash equivalents, beginning of the period | 241.3 | — | ||||||
Cash and cash equivalents, end of the period | $ | 184.3 | $ | 241.3 | ||||
Supplemental Information | ||||||||
Interest paid | $ | 55.1 | $ | 28.1 | ||||
Income taxes paid | $ | 29.3 | $ | 8.5 | ||||
Appreciation of financial instruments | $ | 9.0 | $ | 4.2 | ||||
Property acquired through capital leases | $ | 11.5 | $ | 26.7 |
F-6
Table of Contents
1. | Nature of Business |
2. | Summary of Significant Accounting Policies |
F-7
Table of Contents
Cash payment to Boeing | $ | 903.9 | ||
Direct costs of the acquisition | 20.2 | |||
Less: | ||||
Consideration to be returned from Boeing for sale of capital assets | (202.8 | ) | ||
Consideration to be returned from Boeing for transition costs | (30.0 | ) | ||
Working capital settlement | (19.0 | ) | ||
Total consideration | $ | 672.3 | ||
F-8
Table of Contents
Book Value | ||||
June 16, 2005 | ||||
(Dollars in millions) | ||||
Cash | $ | 1.3 | ||
Accounts receivable | 0.3 | |||
Inventory | 479.2 | |||
Other current assets | 0.3 | |||
Property, plant and equipment | 231.1 | |||
Intangible assets | 17.3 | |||
Other assets | 6.8 | |||
Pension asset | 101.2 | |||
Accounts payable and accrued liabilities | (130.2 | ) | ||
Post-retirement liabilities | (35.0 | ) | ||
Net assets acquired | $ | 672.3 | ||
F-9
Table of Contents
Cash payment to BAE Systems | $ | 139.1 | ||
Direct costs of the acquisition | 3.6 | |||
Working capital settlement | 3.0 | |||
Total consideration | $ | 145.7 | ||
Book Value | ||||
April 1, 2006 | ||||
(Dollars in millions) | ||||
Cash | $ | 0.3 | ||
Accounts receivable | 61.9 | |||
Inventory | 44.2 | |||
Property, plant and equipment | 88.0 | |||
Intangible assets | 30.1 | |||
Goodwill | 10.3 | |||
Currency hedge assets | 11.1 | |||
Accounts payable and accrued liabilities | (67.0 | ) | ||
Pension liabilities | (19.1 | ) | ||
Other liabilities | (12.4 | ) | ||
Currency hedge liabilities | (1.7 | ) | ||
Net assets acquired | $ | 145.7 | ||
F-10
Table of Contents
2007 | $ | 13.5 | ||
2008 | 13.5 | |||
2009 | 8.7 | |||
2010 | 1.9 | |||
2011 | — |
F-11
Table of Contents
F-12
Table of Contents
Estimated Useful Life | ||||
Land improvements | 20 years | |||
Buildings | 40 years | |||
Machinery and equipment | 3-11 years | |||
Tooling — Airplane program — B787 | 5-20 years | |||
Tooling — Airplane program — all others | 2-10 years |
F-13
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F-14
Table of Contents
• | Recognize the funded status of the Company’s defined benefit plans in its consolidated financial statements. | |
• | Recognize as a component of other comprehensive income any actuarial gains and losses and prior service costs and credits that arise during the period but are not immediately recognized as components of net periodic benefit cost. | |
• | Measure defined benefit plan assets and obligations as of the Company’s fiscal year end. | |
• | Disclose in the notes to the financial statements additional information about certain effects on net periodic cost for the subsequent fiscal year that arise from delayed recognition of gains or losses, prior to service costs or credits, and transition asset or obligation. | |
• | Requires that we change our measurement date from November to the fiscal year end (i.e. December 31) by year-end 2008. | |
• | The standard is effective for fiscal years ending after December 15, 2006. See Note 9, Pensions and Other Post-Retirement Benefits. |
F-15
Table of Contents
December 31, | December 29, | |||||||
2006 | 2005 | |||||||
Raw materials | $ | 118.1 | $ | 68.6 | ||||
Work-in-process | 729.9 | 442.1 | ||||||
Finished goods | 34.2 | — | ||||||
Total inventory, net | $ | 882.2 | $ | 510.7 | ||||
December 31, | December 29, | |||||||
2006 | 2005 | |||||||
B737 | $ | 280.6 | $ | 243.8 | ||||
B747 | 62.8 | 60.9 | ||||||
B767 | 25.2 | 16.2 | ||||||
B777 | 152.9 | 126.5 | ||||||
B787(1) | 172.2 | — | ||||||
Airbus-All platforms | 70.2 | — | ||||||
Other in-process inventory related to long-term contracts and other programs(2) | 118.3 | 63.3 | ||||||
Balance-December 31, 2006 | $ | 882.2 | $ | 510.7 | ||||
(1) | B787 inventory includes $143.3 in capitalized pre-production costs. | |
(2) | Contracted non-recurring services for certain derivative aircraft programs to be paid by OEM, plus miscellaneous otherwork-in-process. |
F-16
Table of Contents
4. | Property, Plant and Equipment |
December 31, | December 29, | |||||||
2006 | 2005 | |||||||
Land (including improvements) | $ | 22.5 | $ | 18.8 | ||||
Buildings | 154.2 | 116.0 | ||||||
Machinery and equipment | 219.5 | 121.8 | ||||||
Tooling | 245.4 | 121.6 | ||||||
Construction in progress | 213.4 | 169.2 | ||||||
Total | 855.0 | 547.4 | ||||||
Less: accumulated depreciation | (81.2 | ) | (28.6 | ) | ||||
Property, plant and equipment, net | $ | 773.8 | $ | 518.8 | ||||
5. | Long-Term Receivable |
2008 | $ | 116.1 | ||
2009 | 115.4 | |||
Total | $ | 231.5 | ||
F-17
Table of Contents
6. | Other Assets |
December 31, | December 29, | |||||||
2006 | 2005 | |||||||
Intangible assets | ||||||||
Patents | $ | 2.0 | $ | 3.5 | ||||
Favorable leasehold interests | 9.7 | 27.3 | ||||||
Customer relationships | 33.8 | — | ||||||
Total intangible assets | 45.5 | 30.8 | ||||||
Less: Accumulated amortization-patents | (0.2 | ) | (0.2 | ) | ||||
Accumulated amortization-favorable leasehold interest | (1.3 | ) | (1.1 | ) | ||||
Accumulated amortization-customer relationships | (3.2 | ) | — | |||||
Intangible assets, net | 40.8 | 29.5 | ||||||
Deferred tax asset | 39.1 | — | ||||||
Deferred financing costs, net | 14.8 | 22.4 | ||||||
Fair value of derivative instruments | 24.3 | 6.9 | ||||||
Goodwill — Europe | 6.0 | — | ||||||
Other | 4.1 | 4.4 | ||||||
Total | $ | 129.1 | $ | 63.2 | ||||
2007 | $ | 4.8 | ||
2008 | $ | 4.8 | ||
2009 | $ | 4.8 | ||
2010 | $ | 4.8 | ||
2011 | $ | 4.9 |
7. | Derivative and Hedging Activities |
Effective | Fair Value, | |||||||||||||||||||
Principal | Variable | Fixed | Fixed | December 31, | ||||||||||||||||
Amount | Expires | Rate | Rate | Rate | 2006 | |||||||||||||||
$ | 100 | July 2008 | LIBOR | 4.24 | % | 5.99 | % | $ | 1.3 | |||||||||||
$ | 300 | July 2009 | LIBOR | 4.30 | % | 6.05 | % | $ | 5.2 | |||||||||||
$ | 100 | July 2010 | LIBOR | 4.37 | % | 6.12 | % | $ | 2.1 |
F-18
Table of Contents
F-19
Table of Contents
8. | Debt |
F-20
Table of Contents
December 31, | December 29, | |||||||
2006 | 2005 | |||||||
Senior secured debt | $ | 589.8 | $ | 696.5 | ||||
Present value of capital lease obligations | 28.4 | 25.1 | ||||||
Total | $ | 618.2 | $ | 721.6 | ||||
As of | ||||
December 31, | ||||
2006 | ||||
2007 | $ | 5.9 | ||
2008 | $ | 5.9 | ||
2009 | $ | 5.9 | ||
2010 | $ | 5.9 | ||
2011 | $ | 5.9 | ||
Thereafter | $ | 560.3 |
F-21
Table of Contents
9. | Pension and Other Post-Retirement Benefits |
F-22
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F-23
Table of Contents
Other | ||||||||
Defined Benefit | Post-Retirement | |||||||
U.S. Plans — 2006 | Pension Plans | Benefit Plans | ||||||
Change in benefit obligation | ||||||||
Benefit obligation, beginning of period | $ | 543.1 | $ | 31.2 | ||||
Acquisitions | 12.3 | 0.3 | ||||||
Service cost | — | 1.8 | ||||||
Interest cost | 33.3 | 1.8 | ||||||
Amendments | — | — | ||||||
Actuarial loss (gain) | 25.7 | (2.0 | ) | |||||
Benefits paid | (1.1 | ) | — | |||||
Benefit obligation, end of period | $ | 613.3 | $ | 33.1 | ||||
Change in plan assets | ||||||||
Fair value of plan assets, beginning of period | $ | 549.4 | $ | — | ||||
Acquisitions | 177.5 | — | ||||||
Actual return on plan assets | 95.0 | — | ||||||
Benefits paid | (1.1 | ) | — | |||||
Expenses paid | (0.9 | ) | — | |||||
Fair value of plan assets, end of period | $ | 819.9 | $ | — | ||||
Reconciliation of funded status | ||||||||
Funded status at the end of the year | $ | 206.6 | $ | (33.1 | ) | |||
Employer contributions between measurement date and fiscal year-end | — | — | ||||||
Net amount recognized (after FAS 158) | 206.6 | (33.1 | ) | |||||
Amounts recognized in the financial statements | ||||||||
Noncurrent assets | $ | 207.3 | $ | — | ||||
Current liabilities | — | — | ||||||
Noncurrent liabilities | (0.7 | ) | (33.1 | ) | ||||
Net amount recognized (after FAS 158) | $ | 206.6 | $ | (33.1 | ) | |||
F-24
Table of Contents
Other | ||||||||
Defined Benefit | Post-Retirement | |||||||
U.S. Plans — 2006 | Pension Plans | Benefit Plans | ||||||
Amounts not yet reflected in net periodic benefit cost and included In AOCI (FAS 158) | ||||||||
Prior service cost credit | $ | — | $ | — | ||||
Accumulated gain(loss) | 65.4 | 4.5 | ||||||
Accumulated other comprehensive income (AOCI) | $ | 65.4 | $ | 4.5 | ||||
Cumulative employer contributions in excess of net periodic benefit cost | 141.2 | (37.6 | ) | |||||
Net amount recognized in statement of financial position | 206.6 | (33.1 | ) | |||||
AOCI before FAS 158 | $ | — | $ | — | ||||
Change in AOCI due to FAS 158 | 65.4 | 4.5 | ||||||
Information for pension plans with benefit obligations in excess of plan assets | ||||||||
Projected benefit obligation/APBO | $ | 0.7 | $ | 33.1 | ||||
Accumulated benefit obligation | 0.7 | — | ||||||
Fair value of assets | — | — |
Defined Benefit | ||||
U.K. Plans — 2006 | Pension Plans | |||
Change in benefit obligation | ||||
Benefit obligation, beginning of period | $ | — | ||
Service cost | 5.2 | |||
Interest cost | 0.8 | |||
Employee contributions | 0.1 | |||
Amendments | — | |||
Actuarial loss (gain) | — | |||
Settlements | — | |||
Benefits paid | — | |||
Rebates from U.K. government | 0.6 | |||
Acquisitions | 19.1 | |||
Exchange rate changes | 2.7 | |||
Benefit obligation, end of period | $ | 28.5 | ||
F-25
Table of Contents
Defined Benefit | ||||
U.K. Plans — 2006 | Pension Plans | |||
Change in plan assets | ||||
Fair value of plan assets, beginning of period | $ | — | ||
Acquisitions | — | |||
Actual return on plan assets | 0.1 | |||
Company contributions | 8.0 | |||
Employee contributions | 0.1 | |||
Settlement/curtailment | — | |||
Benefits paid | — | |||
Expenses paid | — | |||
Exchange rate changes | 0.4 | |||
Fair value of plan assets, end of period | $ | 8.6 | ||
Reconciliation of funded status | ||||
Funded status at the end of the year | $ | (19.9 | ) | |
Employer contributions between measurement date and fiscal year-end | — | |||
Net amount recognized (after FAS 158) | (19.9 | ) | ||
Amounts recognized in the financial statements | ||||
Noncurrent assets | $ | — | ||
Current liabilities | — | |||
Noncurrent liabilities | (19.9 | ) | ||
Net amount recognized (after FAS 158) | $ | (19.9 | ) | |
Amounts not yet reflected in net periodic benefit cost and included In AOCI (FAS 158) | ||||
Prior service (cost) credit | $ | — | ||
Accumulated gain(loss) | (0.7 | ) | ||
Accumulated other comprehensive income (AOCI) | $ | (0.7 | ) | |
Prepaid (unfunded accrued) pension cost | (19.2 | ) | ||
Net amount recognized in statement of financial position | (19.9 | ) |
F-26
Table of Contents
Other | ||||||||
Defined Benefit | Post-Retirement | |||||||
U.S. Plans — 2005 | Pension Plans | Benefit Plans | ||||||
Change in benefit obligation | ||||||||
Benefit obligation, beginning of period | $ | — | $ | — | ||||
Acquisitions | 583.8 | 31.8 | ||||||
Service cost | — | 1.0 | ||||||
Interest cost | 17.4 | 0.9 | ||||||
Amendments | — | — | ||||||
Actuarial losses | (58.1 | ) | (2.5 | ) | ||||
Benefit obligation, end of period | $ | 543.1 | $ | 31.2 | ||||
Change in plan assets | ||||||||
Fair value of plan assets, beginning of period | $ | — | $ | — | ||||
Acquisitions | 525.0 | — | ||||||
Actual return on plan assets | 24.4 | — | ||||||
Fair value of plan assets, end of period | $ | 549.4 | $ | — | ||||
Reconciliation of funded status | ||||||||
Funded status — assets minus obligation | $ | 6.3 | $ | (31.2 | ) | |||
Unrecognized actuarial loss (gain) | (59.0 | ) | (2.4 | ) | ||||
Net amount recognized | $ | (52.7 | ) | $ | (33.6 | ) | ||
Amounts recognized in the financial statements | ||||||||
Prepaid benefit cost | $ | — | $ | — | ||||
Accrued benefit liability | (52.7 | ) | (33.6 | ) | ||||
Accumulated other comprehensive income | — | — | ||||||
Net amount recognized | $ | (52.7 | ) | $ | (33.6 | ) | ||
F-27
Table of Contents
Other | ||||||||
Defined Benefit | Post-Retirement | |||||||
U.S. Plans — 2006 | Pension Plans | Benefit Plans | ||||||
Assumptions used to determine benefit obligation for the period ended December 31, 2006 | ||||||||
Discount rate | 5.75 percent | 5.60 percent | ||||||
Salary increases | N/A | N/A | ||||||
Medical assumptions | ||||||||
Trend assumed for next year | N/A | 9 percent | ||||||
Ultimate trend rate | N/A | 5 percent | ||||||
Year that ultimate trend rate is reached | N/A | 2011 | ||||||
Components of benefit (income) expense | ||||||||
Service cost | $ | — | $ | 1.8 | ||||
Interest cost | 33.3 | 1.8 | ||||||
Expected return on plan assets | (59.9 | ) | — | |||||
Net benefit (income) expense | $ | (26.6 | ) | $ | 3.6 | |||
Other Changes Recognized on OCI | ||||||||
Total recognized in OCI | $ | — | $ | — | ||||
Total recognized in net periodic benefit cost and OCI | (26.6 | ) | 3.6 | |||||
Assumptions used to determine benefit expense for the period ended December 31, 2006 | ||||||||
Discount rate | 6 percent | 5.75 percent | ||||||
Expected return on plan assets | 8.25 percent | N/A | ||||||
Salary increases | N/A | N/A | ||||||
Medical assumptions | ||||||||
Trend assumed for next year | N/A | 10 percent | ||||||
Ultimate trend rate | N/A | 5 percent | ||||||
Year that ultimate trend rate is reached | N/A | 2011 |
F-28
Table of Contents
Defined Benefit | ||||
U.K. Plans — 2006 | Pension Plans | |||
Assumptions used to determine benefit obligation for the period ended December 31, 2006 | ||||
Discount rate | 5 percent | |||
Salary increases | 4 percent | |||
Medical assumptions | ||||
Trend assumed for next year | N/A | |||
Ultimate trend rate | N/A | |||
Year that ultimate trend rate is reached | N/A | |||
Components of benefit (income) expense | ||||
Service cost | $ | 5.2 | ||
Interest cost | 0.8 | |||
Expected return on plan assets | (0.2 | ) | ||
Net benefit (income) expense | $ | 5.8 | ||
Other Changes Recognized on OCI | ||||
Total recognized in OCI | $ | — | ||
Total recognized in net periodic benefit cost and OCI | 5.8 | |||
Assumptions used to determine benefit expense for the period ended December 31, 2006 | ||||
Discount rate | 5 percent | |||
Expected return on plan assets | 5 percent | |||
Salary increases | 4 percent |
F-29
Table of Contents
Other | ||||||||
Defined Benefit | Post-Retirement | |||||||
U.S. Plans — 2005 | Pension Plans | Benefit Plans | ||||||
Assumptions used to determine benefit obligation for the period ended December 29, 2005 | ||||||||
Discount rate | 6 percent | 5.75 percent | ||||||
Salary increases | N/A | N/A | ||||||
Medical assumptions | ||||||||
Trend assumed for next year | N/A | 10 percent | ||||||
Ultimate trend rate | N/A | 5 percent | ||||||
Year that ultimate trend rate is reached | N/A | 2011 | ||||||
Components of benefit (income) expense | ||||||||
Service cost | $ | — | $ | 1.0 | ||||
Interest cost | 17.4 | 0.9 | ||||||
Expected return on plan assets | (23.5 | ) | — | |||||
Net benefit (income) expense | $ | (6.1 | ) | $ | 1.9 | |||
Assumptions used to determine benefit expense for the period ended December 29, 2005 | ||||||||
Discount rate | 5.5 percent | 5.25 percent | ||||||
Expected return on plan assets | 8.25 percent | N/A | ||||||
Salary increases | N/A | N/A | ||||||
Medical assumptions | ||||||||
Trend assumed for next year | N/A | 11.0 percent | ||||||
Ultimate trend rate | N/A | 5.0 percent | ||||||
Year that ultimate trend rate is reached | N/A | 2011 |
F-30
Table of Contents
2006 | 2005 | |||||||
Asset Category — U.S. | ||||||||
Equity securities — U.S. | 50 | % | 55 | % | ||||
Equity securities — International | 13 | % | 7 | % | ||||
Debt securities | 29 | % | 37 | % | ||||
Real estate | 5 | % | — | |||||
Other | 3 | % | 1 | % | ||||
Total | 100 | % | 100 | % | ||||
Equities | 40% — 80% | |
Fixed Income | 20% — 60% | |
Real Estate | 0% — 7% |
Asset Category — U.K. | ||||
Equity securities | 44 | % | ||
Debt securities | 56 | % | ||
Real Estate | — | |||
Other | — | |||
Total | 100 | % | ||
F-31
Table of Contents
Equities | 50 | % | ||
Bonds | 50 | % |
Other Post- | ||||||||
Retirement | ||||||||
U.S. | Pension Plans | Benefit Plans | ||||||
2007 | $ | 1.7 | $ | — | ||||
2008 | $ | 3.1 | $ | 0.1 | ||||
2009 | $ | 4.9 | $ | 0.2 | ||||
2010 | $ | 7.3 | $ | 0.3 | ||||
2011 | $ | 10.0 | $ | 0.4 | ||||
2012-2016 | $ | 109.4 | $ | 16.7 |
U.K. | Pension Plans | |||
2007 | $ | 0.3 | ||
2008 | $ | 0.5 | ||
2009 | $ | 0.9 | ||
2010 | $ | 1.3 | ||
2011 | $ | 1.8 | ||
2012-2016 | $ | 19.1 |
10. | Capital Stock |
F-32
Table of Contents
11. | Stock Compensation |
F-33
Table of Contents
Shares | Value | |||||||
(Thousands) | (Millions) | |||||||
Executive Incentive Plan | ||||||||
Nonvested at February 7, 2005 (date of inception) | — | $ | — | |||||
Granted during period | 8,476 | 90.8 | ||||||
Vested during period | — | — | ||||||
Forfeited during period | — | — | ||||||
Nonvested at December 29, 2005 | 8,476 | $ | 90.8 | |||||
Granted during period | 916 | 16.6 | ||||||
Vested during period | (4,031 | ) | (46.2 | ) | ||||
Forfeited during period | — | — | ||||||
Nonvested at December 31, 2006 | 5,361 | $ | 61.2 | |||||
Shares | Value | |||||||
(Thousands) | (Millions) | |||||||
Board of Directors Stock Grants | ||||||||
Nonvested at February 7, 2005 (date of inception) | — | $ | — | |||||
Granted during period | 390 | 5.8 | ||||||
Vested during period | — | — | ||||||
Forfeited during period | — | — | ||||||
Nonvested at December 29, 2005 | 390 | $ | 5.8 | |||||
Granted during period | — | — | ||||||
Vested during period | (167 | ) | (2.5 | ) | ||||
Forfeited during period | — | — | ||||||
Nonvested at December 31, 2006 | 223 | $ | 3.3 | |||||
F-34
Table of Contents
Shares | Value(1) | |||||||
(Thousands) | (Millions) | |||||||
Short Term Incentive Plan | ||||||||
Nonvested at December 29, 2005 | — | — | ||||||
Granted during period | 465 | $ | 7.8 | |||||
Vested during period | — | — | ||||||
Exercised during period | — | — | ||||||
Forfeited during period | — | — | ||||||
Nonvested at December 31, 2006 | 465 | $ | 7.8 | |||||
(1) | Value represents grant date fair value. |
F-35
Table of Contents
Shares | Value(1) | |||||||
(Thousands) | (Millions) | |||||||
Union Equity Participation Plan | ||||||||
Nonvested at February 7, 2005 (date of inception) | — | — | ||||||
Granted during period(2) | 4,835 | $ | 125.7 | |||||
Vested during period | — | — | ||||||
Exercised during period | — | — | ||||||
Forfeited during period | — | — | ||||||
Nonvested at December 29, 2005 | 4,835 | 125.7 | ||||||
Granted during period | — | — | ||||||
Vested during period(3) | (4,835 | ) | (125.7 | ) | ||||
Exercised during period | — | — | ||||||
Forfeited during period | — | — | ||||||
Nonvested at December 31, 2006 | — | $ | — | |||||
(1) | Value represents the IPO stock value of $26 per share on closing date of IPO on November 27, 2006. | |
(2) | Although the UEP plan began in June 2005, no expenses were recorded at that time as the IPO which triggered the obligation had not yet occurred. | |
(3) | Upon the closing date of the IPO, all rights to receive stock were considered vested. The share figure represents the estimated amount of shares that will be issued to eligible employees on or before March 15, 2007. |
12. | Income Taxes |
2006 | 2005 | |||||||
U.S. | $ | (73.2 | ) | $ | (76.6 | ) | ||
International | 1.7 | — | ||||||
Total | $ | (71.5 | ) | $ | (76.6 | ) | ||
F-36
Table of Contents
2006 | 2005 | |||||||
Income taxes estimated to be payable currently | ||||||||
U.S. federal | $ | 10.3 | $ | 9.1 | ||||
U.S. state and local | 0.9 | — | ||||||
Foreign | — | — | ||||||
Total payable currently | 11.2 | 9.1 | ||||||
Income taxes estimated to be payable — long term | ||||||||
U.S. federal | 15.0 | 7.2 | ||||||
U.S. state and local | 0.2 | — | ||||||
Foreign | — | — | ||||||
Total payable — long term | 15.2 | 7.2 | ||||||
Deferred income tax expense (credit) — net | ||||||||
U.S. federal | (88.8 | ) | (2.3 | ) | ||||
U.S. state and local | (26.5 | ) | (0.3 | ) | ||||
Foreign | 0.6 | — | ||||||
Total deferred | (114.7 | ) | (2.6 | ) | ||||
Total (benefit) provision for income taxes | $ | (88.3 | ) | $ | 13.7 | |||
2006 | 2005 | |||||||
Tax (benefit) at U.S. federal statutory income tax rate | $ | (25.0 | ) | $ | (26.8 | ) | ||
State and local tax benefit | (16.3 | ) | (3.9 | ) | ||||
Valuation allowance (reversal) | (40.1 | ) | 41.5 | |||||
Research and Development Credit | (7.3 | ) | — | |||||
Other | (0.7 | ) | (0.5 | ) | ||||
Stock compensation | 1.1 | 3.4 | ||||||
Total (benefit) provision for income taxes | $ | (88.3 | ) | $ | 13.7 | |||
F-37
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2006 | 2005 | |||||||
Long-term contract methods of income recognition | $ | 67.9 | $ | 28.2 | ||||
Post-retirement benefits other than pensions | 12.7 | 12.8 | ||||||
Pension and other employee benefit plans | (62.7 | ) | 20.2 | |||||
Employee compensation accruals | 23.3 | 15.8 | ||||||
Depreciation and amortization | 21.5 | (28.3 | ) | |||||
Inventory | 38.9 | 2.3 | ||||||
Interest swap contracts | (5.3 | ) | (2.6 | ) | ||||
State income tax credits | 8.1 | 0.4 | ||||||
Other | 2.9 | (1.7 | ) | |||||
Net deferred tax asset | 107.3 | 47.1 | ||||||
Valuation Allowances | — | (47.1 | ) | |||||
Net deferred tax asset | $ | 107.3 | $ | — | ||||
2006 | 2005 | |||||||
Current deferred tax assets | $ | 64.9 | $ | 3.1 | ||||
Current deferred tax liabilities | — | (2.0 | ) | |||||
Net current deferred tax asset | 64.9 | 1.1 | ||||||
Non-current deferred tax assets | 117.8 | 29.8 | ||||||
Non-current deferred tax liabilities | (75.4 | ) | (30.9 | ) | ||||
Net non-current deferred tax asset (liability) | $ | 42.4 | $ | (1.1 | ) | |||
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13. | Earnings (Loss) per Share Calculation |
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Period From February 7, 2005 | ||||||||||||
(Date of Inception) | ||||||||||||
through December 29, 2005 | ||||||||||||
Per Share | ||||||||||||
Basic & Diluted EPS | Income | Shares | Amount | |||||||||
Loss available to common shareholders | $ | (90.3 | ) | 113.5 | $ | (0.80 | ) |
For the Year Ended December 31, 2006 | ||||||||||||
Per Share | ||||||||||||
Basic EPS | Income | Shares | Amount | |||||||||
Income available to common shareholders | $ | 16.8 | 115.6 | $ | 0.15 | |||||||
Diluted Potential Common Shares | 6.4 | |||||||||||
Diluted EPS | ||||||||||||
Income available to common shareholders + assumed vesting and conversion | $ | 16.8 | 122.0 | $ | 0.14 |
14. | Related-Party Transactions |
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15. | Commitments, Contingencies and Guarantees |
Capital | ||||||||||||||||
Present | ||||||||||||||||
Operating | Value | Interest | Total | |||||||||||||
2007 | $ | 5.8 | $ | 18.0 | $ | 1.3 | $ | 19.3 | ||||||||
2008 | $ | 4.7 | $ | 9.4 | $ | 0.2 | $ | 9.6 | ||||||||
2009 | $ | 3.4 | $ | 1.0 | $ | — | $ | 1.0 | ||||||||
2010 | $ | 2.1 | $ | — | $ | — | $ | — | ||||||||
2011 | $ | 1.2 | $ | — | $ | — | $ | — | ||||||||
2012 and thereafter | $ | 4.3 | $ | — | $ | — | $ | — |
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16. | Significant Concentrations of Risk |
17. | Supplemental Balance Sheet Information |
December 31, | December 29, | |||||||
2006 | 2005(1) | |||||||
Accrued expenses | ||||||||
Accrued wages and bonuses | $ | 35.3 | $ | 21.9 | ||||
Accrued fringe benefits | 91.0 | 65.1 | ||||||
Accrued interest | 3.3 | 9.2 | ||||||
Advance payments — B787(2) | 12.6 | — | ||||||
Workers’ compensation | 8.6 | — | ||||||
Other | 19.2 | 29.4 | ||||||
Total | $ | 170.0 | $ | 125.6 | ||||
Other liabilities | ||||||||
Pension obligation | $ | 19.9 | $ | 52.7 | ||||
Post-employment benefit obligation | 33.8 | 33.6 | ||||||
Federal income taxes — long-term | 21.6 | 7.2 | ||||||
Deferred revenue and other deferred credits | 36.0 | — | ||||||
Other | 0.5 | 14.7 | ||||||
Total | $ | 111.8 | $ | 108.2 | ||||
(1) | In 2005, unreserved sick leave of $14.2 was recorded in other liabilities. In 2006, unreserved sick leave was recorded in accrued fringe benefits. | |
(2) | Represents the current portion of the $600.0 advance payment received from Boeing for the B787 Supply Agreement. |
18. | Segment Information |
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Fiscal Year | ||||||||
Period From | ||||||||
June 17, | ||||||||
2005 through | ||||||||
December 31, | December 29, | |||||||
2006 | 2005 | |||||||
Segment Revenues | ||||||||
Fuselage Systems | $ | 1,570.0 | $ | 637.7 | ||||
Propulsion Systems | 887.7 | 372.2 | ||||||
Wing Systems | 720.3 | 170.0 | ||||||
All Other | 29.7 | 27.7 | ||||||
$ | 3,207.7 | $ | 1,207.6 | |||||
Segment Operating Income (Loss)(1) | ||||||||
Fuselage Systems | $ | 112.5 | $ | 43.7 | ||||
Propulsion Systems | 33.7 | 24.5 | ||||||
Wing Systems | 11.8 | 5.1 | ||||||
All Other | 4.3 | (1.2 | ) | |||||
162.3 | 72.1 | |||||||
Unallocated corporate SG&A(2) | (216.5 | ) | (138.9 | ) | ||||
Unallocated research and development | (2.1 | ) | (1.0 | ) | ||||
Total operating income (loss) | $ | (56.3 | ) | $ | (67.8 | ) | ||
(1) | The fiscal year 2006 operating income (loss) for Fuselage Systems, Propulsion Systems, Wing Systems, and All Other include Union Equity Plan (UEP) charges of $172.9, $103.1, $44.9, and $1.0, respectively. | |
(2) | Included in 2006 Unallocated corporate SG&A expenses are a fourth quarter charge of $4.0 million related to the termination of the intercompany agreement with Onex and a charge of $4.3 million related to the Executive Incentive Plan. Both of these charges relate to the Company’s IPO. |
19. | Quarterly Financial Data (Unaudited) |
Quarter Ended | ||||||||||||||||
December 31, | September 28, | June 29, | March 30, | |||||||||||||
2006 | 2006 | 2006 | 2006 | 2006 | ||||||||||||
Net Revenues | $ | 851.8 | $ | 829.7 | $ | 855.4 | $ | 670.8 | ||||||||
Operating income (loss) | $ | (240.4 | ) | $ | 77.5 | $ | 56.0 | $ | 50.6 | |||||||
Net income (loss) | $ | (69.4 | ) | $ | 34.0 | $ | 29.7 | $ | 22.5 | |||||||
Earnings per share, basic | $ | (0.58 | ) | $ | 0.30 | $ | 0.26 | $ | 0.20 | |||||||
Earnings per share, diluted | $ | (0.58 | ) | $ | 0.28 | $ | 0.25 | $ | 0.19 |
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Quarter Ended | ||||||||
For the Period June 17, | ||||||||
December 29, | 2005 through | |||||||
2005 | 2005 | September 29, 2005(a) | ||||||
Net Revenues | $ | 557.4 | $ | 650.2 | ||||
Operating income (loss) | $ | (39.0 | ) | $ | (28.8 | ) | ||
Net income (loss) | $ | (46.9 | ) | $ | (43.4 | ) | ||
Earnings per share, basic | $ | (0.42 | ) | $ | (0.38 | ) | ||
Earnings per share, diluted | $ | (0.42 | ) | $ | (0.38 | ) |
(a) | Spirit AeroSystems Holdings, Inc. was incorporated in the state of Delaware on February 7, 2005 and commenced operations on June 17, 2005 through the acquisition of The Boeing Company’s operations in Wichita, Kansas, Tulsa, Oklahoma and McAlester, Oklahoma. |
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CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 29, 2007 (UNAUDITED)
Condensed Consolidated Statements of Operations
For the Three | For the Three | |||||||
Months Ended | Months Ended | |||||||
March 29, 2007 | March 30, 2006 | |||||||
($ in millions, except per share data) | ||||||||
Net revenues | $ | 954.1 | $ | 670.8 | ||||
Operating costs and expenses | ||||||||
Cost of sales | 794.8 | 533.0 | ||||||
Selling, general and administrative | 45.1 | 44.8 | ||||||
Research and development | 10.4 | 42.4 | ||||||
Total costs and expenses | 850.3 | 620.2 | ||||||
Operating income | 103.8 | 50.6 | ||||||
Interest expense and financing fee amortization | (8.9 | ) | (11.2 | ) | ||||
Interest income | 7.7 | 7.1 | ||||||
Other income, net | 2.0 | 1.4 | ||||||
Income before income taxes | 104.6 | 47.9 | ||||||
Income tax expense | (34.8 | ) | (25.4 | ) | ||||
Net income | $ | 69.8 | $ | 22.5 | ||||
Earnings per share | ||||||||
Basic | $ | 0.54 | $ | 0.20 | ||||
Diluted | $ | 0.50 | $ | 0.19 |
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March 29, | December 31, | |||||||
2007 | 2006 | |||||||
($ in millions) | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 157.3 | $ | 184.3 | ||||
Accounts receivable, net | 256.8 | 200.2 | ||||||
Other receivable | 59.0 | 43.0 | ||||||
Inventory, net | 947.0 | 882.2 | ||||||
Income tax receivable | — | 21.7 | ||||||
Other current assets | 78.1 | 89.1 | ||||||
Total current assets | 1,498.2 | 1,420.5 | ||||||
Property, plant and equipment, net | 841.0 | 773.8 | ||||||
Long-term receivable | 170.0 | 191.5 | ||||||
Pension assets | 215.4 | 207.3 | ||||||
Other assets | 115.5 | 129.1 | ||||||
Total assets | $ | 2,840.1 | $ | 2,722.2 | ||||
Current liabilities | ||||||||
Accounts payable | $ | 357.6 | $ | 339.1 | ||||
Accrued expenses | 185.8 | 198.5 | ||||||
Current portion of long-term debt | 24.9 | 23.9 | ||||||
Other current liabilities | 21.2 | 8.2 | ||||||
Total current liabilities | 589.5 | 569.7 | ||||||
Long-term debt | 590.2 | 594.3 | ||||||
Advance payments | 600.5 | 587.4 | ||||||
Other liabilities | 124.6 | 111.8 | ||||||
Shareholders’ equity | ||||||||
Preferred stock, par value $0.01, 10,000,000 shares authorized, no shares issued and outstanding | — | — | ||||||
Common stock, Class A par value $0.01, 200,000,000 shares authorized, 68,159,104 and 63,345,834 issued and outstanding, respectively | 0.7 | 0.6 | ||||||
Common stock, Class B par value $0.01, 150,000,000 shares authorized, 71,446,595 and 71,351,347 shares issued and outstanding, respectively | 0.7 | 0.7 | ||||||
Additional paid-in capital | 867.2 | 858.7 | ||||||
Accumulated other comprehensive income | 70.4 | 72.5 | ||||||
Accumulated deficit | (3.7 | ) | (73.5 | ) | ||||
Total shareholders’ equity | 935.3 | 859.0 | ||||||
Total liabilities and shareholders’ equity | $ | 2,840.1 | $ | 2,722.2 | ||||
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Accumulated | |||||||||||||||||||||||||||||
Other | |||||||||||||||||||||||||||||
Common Stock | Additional | Comprehensive | Accumulated | Comprehensive | |||||||||||||||||||||||||
Shares | Amount | Paid-in Capital | Income | Deficit | Total | Income/(Loss) | |||||||||||||||||||||||
($ in millions) | |||||||||||||||||||||||||||||
Balance — December 29, 2005 | 122,670,336 | $ | 1.2 | $ | 410.7 | $ | 4.2 | $ | (90.3 | ) | $ | 325.8 | $ | (86.1 | ) | ||||||||||||||
Net income | 16.8 | 16.8 | 16.8 | ||||||||||||||||||||||||||
Pension valuation adjustment, net of tax | 40.0 | 40.0 | |||||||||||||||||||||||||||
Post-retirement benefit valuation adjustment, net of tax | 2.8 | 2.8 | |||||||||||||||||||||||||||
Unrealized gain on cash flow hedges, net of tax | 5.8 | 5.8 | 5.8 | ||||||||||||||||||||||||||
Employee equity awards | 1,381,131 | 51.1 | 51.1 | ||||||||||||||||||||||||||
UEP Stock | 125.7 | 125.7 | |||||||||||||||||||||||||||
Pool of windfall tax benefits | 15.3 | 15.3 | |||||||||||||||||||||||||||
Non-employee equity awards | — | — | 5.6 | 5.6 | |||||||||||||||||||||||||
Equity issuances — IPO, net of issuance costs | 10,416,667 | 0.1 | 249.2 | 249.3 | |||||||||||||||||||||||||
Equity issuances — Management | 229,047 | 1.1 | 1.1 | ||||||||||||||||||||||||||
Unrealized gain on currency translation adjustments, net of tax | — | — | — | 19.7 | 19.7 | 19.7 | |||||||||||||||||||||||
Balance — December 31, 2006 | 134,697,181 | $ | 1.3 | $ | 858.7 | $ | 72.5 | $ | (73.5 | ) | $ | 859.0 | $ | 42.3 | |||||||||||||||
Net income | 69.8 | 69.8 | 69.8 | ||||||||||||||||||||||||||
UEP stock issued | 4,813,270 | 0.1 | (0.7 | ) | (0.6 | ) | |||||||||||||||||||||||
Employee equity awards | 317,652 | — | 7.7 | 7.7 | |||||||||||||||||||||||||
Restricted stock forfeitures | (222,404 | ) | — | (1.1 | ) | (1.1 | ) | ||||||||||||||||||||||
Pool of windfall tax benefits | 2.6 | 2.6 | |||||||||||||||||||||||||||
Unrealized (loss) on cash flow hedges, net of tax | (2.5 | ) | (2.5 | ) | (2.5 | ) | |||||||||||||||||||||||
Unrealized gain on currency translation adjustments, net of tax | — | — | — | 0.4 | 0.4 | 0.4 | |||||||||||||||||||||||
Balance — March 29, 2007 | 139,605,699 | $ | 1.4 | $ | 867.2 | $ | 70.4 | $ | (3.7 | ) | $ | 935.3 | $ | 67.7 | |||||||||||||||
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For the Three | For the Three | |||||||
Months Ended | Months Ended | |||||||
March 29, 2007 | March 30, 2006 | |||||||
($ in millions) | ||||||||
Operating activities | ||||||||
Net income | $ | 69.8 | $ | 22.5 | ||||
Adjustments to reconcile net income to net cash provided by operating activities | ||||||||
Depreciation expense | 20.9 | 16.7 | ||||||
Amortization expense | 1.9 | 1.1 | ||||||
Accretion of long-term receivable | (5.5 | ) | (5.0 | ) | ||||
Employee stock compensation expense | 6.6 | 13.4 | ||||||
Loss on disposition of assets | 0.1 | — | ||||||
Deferred taxes | 6.0 | — | ||||||
Pension, net | (8.1 | ) | (3.2 | ) | ||||
Changes in assets and liabilities, net of acquisition | ||||||||
Accounts receivable | (54.3 | ) | (75.4 | ) | ||||
Inventory, net | (63.6 | ) | (26.5 | ) | ||||
Other current assets | 10.3 | 4.4 | ||||||
Accounts payable and accrued liabilities | (10.2 | ) | 26.0 | |||||
Customer advances | 29.2 | 100.0 | ||||||
Income taxes payable | 23.8 | 18.9 | ||||||
Deferred revenue and other deferred credits | 19.5 | — | ||||||
Other | 3.7 | (2.9 | ) | |||||
Net cash provided by operating activities | 50.1 | 90.0 | ||||||
Investing Activities | ||||||||
Purchase of property, plant and equipment | (87.5 | ) | (93.8 | ) | ||||
Long-term receivable | 11.4 | — | ||||||
Financial derivatives | 1.1 | — | ||||||
Net cash (used in) investing activities | (75.0 | ) | (93.8 | ) | ||||
Financing Activities | ||||||||
Principal payments of debt | (4.7 | ) | (1.8 | ) | ||||
Pool of windfall tax benefits | 2.6 | — | ||||||
Executive stock investments | — | 0.5 | ||||||
Net cash (used in) financing activities | (2.1 | ) | (1.3 | ) | ||||
Effect of exchange rate changes on cash and cash equivalents | — | — | ||||||
Net (decrease) in cash and cash equivalents for the period | (27.0 | ) | (5.1 | ) | ||||
Cash and cash equivalents, beginning of period | 184.3 | 241.3 | ||||||
Cash and cash equivalents, end of period | $ | 157.3 | $ | 236.2 | ||||
Supplemental Information | ||||||||
Change in value of financial instruments | $ | (2.7 | ) | $ | 10.8 | |||
Property acquired through capital leases | $ | 1.6 | $ | — |
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1. | Organization and Basis of Interim Presentation |
2. | New Accounting Pronouncements |
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3. | Inventory |
March 29, | December 31, | |||||||
2007 | 2006 | |||||||
Raw materials | $ | 118.8 | $ | 118.1 | ||||
Work-in-process | 625.0 | 586.6 | ||||||
Finished goods | 13.9 | 34.2 | ||||||
Product inventory | 757.7 | 738.9 | ||||||
Capitalized pre-production | 189.3 | 143.3 | ||||||
Inventory, net | $ | 947.0 | $ | 882.2 | ||||
March 29, | December 31, | |||||||
2007 | 2006 | |||||||
B737 | $ | 291.7 | $ | 280.6 | ||||
B747 | 63.7 | 62.8 | ||||||
B767 | 24.7 | 25.2 | ||||||
B777 | 153.6 | 152.9 | ||||||
B787(1) | 243.8 | 172.2 | ||||||
Airbus-All platforms | 69.4 | 70.2 | ||||||
Other in-process inventory related to long-term contracts and other programs(2) | 100.1 | 118.3 | ||||||
Balance | $ | 947.0 | $ | 882.2 | ||||
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(1) | B787 inventory includes $183.9 and $143.3 in capitalized pre-production costs for March 29, 2007 and December 31, 2006, respectively. | |
(2) | Contracted non-recurring services for certain derivative aircraft programs to be paid by the original equipment manufacturer, plus miscellaneous otherwork-in-process. |
Balance, December 31, 2006 | $ | 15.2 | ||
Charges to costs and expenses | 2.5 | |||
Write-offs net of recoveries | — | |||
Purchased reserves | — | |||
Exchange rate | — | |||
Balance March 29, 2007 | $ | 17.7 | ||
4. | Property, Plant and Equipment |
March 29, | December 31, | |||||||
2007 | 2006 | |||||||
Land (including improvements) | $ | 23.4 | $ | 22.5 | ||||
Buildings | 155.5 | 154.2 | ||||||
Machinery and equipment | 253.8 | 219.5 | ||||||
Tooling | 271.5 | 245.4 | ||||||
Construction in progress | 238.9 | 213.4 | ||||||
Total | 943.1 | 855.0 | ||||||
Less: accumulated depreciation | (102.1 | ) | (81.2 | ) | ||||
Property, plant and equipment, net | $ | 841.0 | $ | 773.8 | ||||
5. | Long-Term Receivable |
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2007 | $ | 34.1 | ||
2008 | 116.1 | |||
2009 | 115.4 | |||
Total | $ | 265.6 | ||
6. | Other Assets |
March 29, | December 31, | |||||||
2007 | 2006 | |||||||
Intangible assets | ||||||||
Patents | $ | 2.0 | $ | 2.0 | ||||
Favorable leasehold interests | 9.7 | 9.7 | ||||||
Customer relationships | 34.0 | 33.8 | ||||||
Total intangible assets | 45.7 | 45.5 | ||||||
Less: Accumulated amortization-patents | (0.3 | ) | (0.2 | ) | ||||
Accumulated amortization-favorable leasehold interests | (1.5 | ) | (1.3 | ) | ||||
Accumulated amortization-customer relationships | (4.2 | ) | (3.2 | ) | ||||
Intangible assets, net | 39.7 | 40.8 | ||||||
Deferred tax asset | 35.2 | 39.1 | ||||||
Deferred financing costs, net | 14.1 | 14.8 | ||||||
Fair value of derivative instruments | 19.8 | 24.3 | ||||||
Goodwill — Europe | 3.6 | 6.0 | ||||||
Other | 3.1 | 4.1 | ||||||
Total | $ | 115.5 | $ | 129.1 | ||||
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7. | Pension and Other Post-Retirement Benefits |
Defined Benefit Plans | ||||||||
Three Months | Three Months | |||||||
Ended | Ended | |||||||
March 29, 2007 | March 30, 2006 | |||||||
Components of Net Periodic Benefit Cost | ||||||||
Service cost | $ | 1.9 | $ | — | ||||
Interest cost | 9.2 | 8.3 | ||||||
Expected return on plan assets | (17.1 | ) | (15.0 | ) | ||||
Amortization of prior service cost | — | — | ||||||
Amortization of net (gain)/loss | — | — | ||||||
Curtailment/settlement | — | — | ||||||
Net periodic benefit cost | $ | (6.0 | ) | $ | (6.7 | ) | ||
Other Benefits | ||||||||
Three Months | Three Months | |||||||
Ended | Ended | |||||||
March 29, 2007 | March 30, 2006 | |||||||
Components of Net Periodic Benefit Cost | ||||||||
Service cost | $ | 0.4 | $ | 0.4 | ||||
Interest cost | 0.5 | 0.5 | ||||||
Expected return on plan assets | — | — | ||||||
Amortization of prior service cost | — | — | ||||||
Amortization of net (gain)/loss | — | — | ||||||
Curtailment/settlement | — | — | ||||||
Net periodic benefit cost | $ | 0.9 | $ | 0.9 | ||||
8. | Stock Compensation |
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Shares | Value(1) | |||||||
(Thousands) | (Millions) | |||||||
Executive Incentive Plan | ||||||||
Nonvested at December 29, 2005 | 8,476 | $ | 90.8 | |||||
Granted during period | 916 | 16.6 | ||||||
Vested during period | (4,031 | ) | (46.2 | ) | ||||
Forfeited during period | — | — | ||||||
Nonvested at December 31, 2006 | 5,361 | 61.2 | ||||||
Granted during period | — | — | ||||||
Vested during period | — | — | ||||||
Forfeited during period | (202 | ) | (2.8 | ) | ||||
Nonvested at March 29, 2007 | 5,159 | $ | 58.4 | |||||
(1) | Value represents grant date fair value. |
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Shares | Value(1) | |||||||
(Thousands) | (Millions) | |||||||
Board of Directors Stock Grants | ||||||||
Nonvested at December 29, 2005 | 390 | $ | 5.8 | |||||
Granted during period | — | — | ||||||
Vested during period | (167 | ) | (2.5 | ) | ||||
Forfeited during period | — | — | ||||||
Nonvested at December 31, 2006 | 223 | 3.3 | ||||||
Granted during period | — | — | ||||||
Vested during period | — | — | ||||||
Forfeited during period | — | — | ||||||
Nonvested at March 29, 2007 | 223 | $ | 3.3 | |||||
(1) | Value represents grant date fair value. |
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Shares | Value(1) | |||||||
(Thousands) | (Millions) | |||||||
Short Term Incentive Plan | ||||||||
Nonvested at December 29, 2005 | — | — | ||||||
Granted during period | 465 | $ | 7.8 | |||||
Vested during period | — | — | ||||||
Exercised during period | — | — | ||||||
Forfeited during period | — | — | ||||||
Nonvested at December 31, 2006 | 465 | 7.8 | ||||||
Granted during period | 250 | 7.5 | ||||||
Vested during period | (456 | ) | (7.6 | ) | ||||
Exercised during period | — | — | ||||||
Fortfeited during the period | (19 | ) | (0.5 | ) | ||||
Nonvested at March 29, 2007 | 240 | $ | 7.2 | |||||
(1) | Value represents grant date fair value. |
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Shares | Value(1) | |||||||
(Thousands) | (Millions) | |||||||
Long Term Incentive Plan | ||||||||
Nonvested at December 31, 2006 | — | — | ||||||
Granted during the period | 67 | $ | 2.0 | |||||
Vested during period | — | — | ||||||
Exercised during period | — | — | ||||||
Forfeited during the period | (1 | ) | — | |||||
Nonvested at March 29, 2007 | 66 | $ | 2.0 | |||||
(1) | Value represents grant date fair value. |
Shares | Value(1) | |||||||
(Thousands) | (Millions) | |||||||
Union Equity Participation Plan | ||||||||
Nonvested at December 29, 2005 | 4,813 | $ | 125.1 | |||||
Granted during period | — | — | ||||||
Vested during period | — | — | ||||||
Exercised during period | — | — | ||||||
Forfeited during period | — | — | ||||||
Nonvested at December 31, 2006 | 4,813 | 125.1 | ||||||
Granted during period | — | — | ||||||
Vested during period | (4,813 | ) | (125.1 | ) | ||||
Exercised during period | — | — | ||||||
Forfeited during period | — | — | ||||||
Nonvested at March 29, 2007 | — | $ | — | |||||
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(1) | Value represents the IPO price of $26 per share. |
9. | Income Taxes |
10. | Earnings per Share Calculation |
Three Months Ended March 29, 2007 | ||||||||||||
Per Share | ||||||||||||
Income | Shares | Amount | ||||||||||
Basic EPS | ||||||||||||
Income available to common shareholders | $ | 69.8 | 129.7 | $ | 0.54 | |||||||
Diluted Potential Common Shares | 9.3 | |||||||||||
Diluted EPS | ||||||||||||
Income available to common shareholders + assumed vesting and conversion | $ | 69.8 | 139.0 | $ | 0.50 |
Three Months Ended March 30, | ||||||||||||
2006 | ||||||||||||
Per Share | ||||||||||||
Income | Shares | Amount | ||||||||||
Basic EPS | ||||||||||||
Income available to common shareholders | $ | 22.5 | 113.9 | $ | 0.20 | |||||||
Diluted Potential Common Shares | 3.3 | |||||||||||
Diluted EPS | ||||||||||||
Income available to common shareholders + assumed vesting and conversion | $ | 22.5 | 117.2 | $ | 0.19 |
11. | Related Party Transactions |
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12. | Commitments, Contingencies and Guarantees |
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13. | Segment Information |
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Three Months Ended | Three Months Ended | |||||||
March 29, 2007 | March 30, 2006(1) | |||||||
Segment Net Revenues | ||||||||
Fuselage Systems | $ | 445.2 | $ | 353.7 | ||||
Propulsion Systems | 260.4 | 216.5 | ||||||
Wing Systems | 241.2 | 92.0 | ||||||
All Other | 7.3 | 8.6 | ||||||
$ | 954.1 | $ | 670.8 | |||||
Segment Operating Income | ||||||||
Fuselage Systems | $ | 83.0 | $ | 60.1 | ||||
Propulsion Systems | 40.3 | 29.8 | ||||||
Wing Systems | 23.2 | 5.5 | ||||||
All Other | 0.8 | 0.5 | ||||||
147.3 | 95.9 | |||||||
Unallocated corporate SG&A | (42.5 | ) | (43.4 | ) | ||||
Unallocated research and development | (1.0 | ) | (1.9 | ) | ||||
Total operating income | $ | 103.8 | $ | 50.6 | ||||
(1) | Net revenues for Wing Systems exclude Spirit Europe before April 1, 2006, the date we acquired BAE Aerostructures. |
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June 16, | December 31, | |||||||
2005 | 2004 | |||||||
(Amounts in millions) | ||||||||
ASSETS: | ||||||||
Cash | $ | 0.8 | $ | 3.0 | ||||
Accounts receivable | 0.4 | 2.0 | ||||||
Inventories | 487.6 | 524.6 | ||||||
Long-term assets | 3.2 | 3.0 | ||||||
Property, plant, and equipment — net | 528.4 | 511.0 | ||||||
Total assets | 1,020.4 | 1,043.6 | ||||||
LIABILITIES: | ||||||||
Accounts payable | 57.4 | 45.7 | ||||||
Accrued expenses | 2.0 | 6.1 | ||||||
Employee vacation | 40.3 | 47.5 | ||||||
Accrued employee-related expenses | 7.9 | 8.4 | ||||||
KIESC minority interest | 0.5 | 0.5 | ||||||
Total liabilities | 108.1 | 108.2 | ||||||
NET ASSETS | $ | 912.3 | $ | 935.4 | ||||
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Period From | ||||||||
January 1, 2005 | Year Ended | |||||||
through | December 31, | |||||||
June 16, 2005 | 2004 | |||||||
(Amounts in millions) | ||||||||
COST OF PRODUCTS TRANSFERRED: | ||||||||
Labor | $ | 326.6 | $ | 688.8 | ||||
Material | 503.0 | 885.1 | ||||||
Overhead and nonlabor | 334.3 | 500.4 | ||||||
Total cost of products transferred | 1,163.9 | 2,074.3 | ||||||
PROVISION OF ENERGY SERVICES — Net | (0.2 | ) | — | |||||
PERIOD EXPENSES: | ||||||||
General and administrative | 79.7 | 155.1 | ||||||
Internal application development | 11.0 | 18.1 | ||||||
Total period expenses | 90.7 | 173.2 | ||||||
TOTAL INCURRED AND ALLOCATED COSTS OF THE WICHITA DIVISION | $ | 1,254.4 | $ | 2,247.5 | ||||
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1. | BASIS OF PRESENTATION |
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Period | ||||||||
1/1/2005 | ||||||||
through | Year Ended | |||||||
Incurring Org and Description | 6/16/2005 | 2004 | ||||||
Allocated WHQ — G&A | $ | 15.9 | $ | 31.2 | ||||
Allocated WHQ — Share-Based Plans | 20.1 | 19.4 | ||||||
Allocated WHQ — Share-Value Trust | 2.0 | 3.9 | ||||||
Allocated BCA G&A | 26.7 | 53.2 | ||||||
SSG G&A included in SSG Support Allocations (below) | 5.5 | 29.6 | ||||||
Division Incurred — G&A | 9.5 | 17.8 | ||||||
Total Division G&A Expense | $ | 79.7 | $ | 155.1 | ||||
Period | ||||||||
1/1/2005 | ||||||||
through | Year Ended | |||||||
Incurring Org and Description | 6/16/2005 | 2004 | ||||||
Division Incurred — IAD (A period expense on the Statement of Cost Center Activity) | $ | 17.3 | $ | 18.1 | ||||
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Period | ||||||||
1/1/2005 | ||||||||
through | Year Ended | |||||||
Incurring Org and Description | 6/16/2005 | 2004 | ||||||
BCA — CAD/CAM and Other | $ | 4.9 | $ | 4.3 | ||||
SSG — Workplace Services | 114.6 | 233.4 | ||||||
SSG — Information Technology Services | 25.1 | 46.3 | ||||||
SSG — Administrative Services | 21.2 | 41.9 | ||||||
Total Support Allocations (including SSG G&A) | 165.8 | 325.9 | ||||||
Less SSG G&A Allocations included in Cost Allocation Table(1) above | 5.5 | 29.6 | ||||||
Total SSG Costs and BCA CAD/CAM and Other included in Division Cost of Products Transferred | $ | 160.3 | $ | 296.3 | ||||
Period | ||||||||
1/1/2005 | ||||||||
through | Year Ended | |||||||
Incurring Org and Description | 6/16/2005 | 2004 | ||||||
Division Incurred — G&A (Included in Table(1)) | $ | 9.5 | $ | 17.8 | ||||
Division Incurred — IAD (Included in Table(2)) | 11.0 | 18.1 | ||||||
Total | $ | 20.5 | $ | 35.9 | ||||
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Period | ||||||||
1/1/2005 | ||||||||
through | Year Ended | |||||||
Incurring Org and Description | 6/16/2005 | 2004 | ||||||
Corporate — G&A | $ | 15.9 | $ | 31.2 | ||||
Corporate — Share-Based Plans | 20.1 | 19.4 | ||||||
Corporate — Share-Value Trust | 2.0 | 3.9 | ||||||
BCA — G&A | 26.7 | 53.2 | ||||||
Total Period Expense incurred by Boeing not billed or incurred | $ | 64.7 | $ | 107.7 | ||||
2. | SIGNIFICANT ACCOUNTING POLICIES |
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Period | ||||||||
1/1/2005 | ||||||||
through | ||||||||
Incurring Org and Description | 6/16/2005 | 12/31/04 | ||||||
KIESC Total Net Assets | $ | 2.7 | $ | 2.2 | ||||
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3. | STANDARDS ISSUED AND NOT YET IMPLEMENTED |
4. | INVENTORIES |
Period | ||||||||
1/1/2005 | ||||||||
through | ||||||||
6/16/2005 | 12/31/2004 | |||||||
Raw materials | $ | 213.5 | $ | 209.1 | ||||
Work in process | 274.1 | 315.5 | ||||||
Inventories | $ | 487.6 | $ | 524.6 | ||||
5. | PROPERTY, PLANT, AND EQUIPMENT |
Period | ||||||||
1/1/2005 | ||||||||
through | ||||||||
6/16/2005 | 12/31/2004 | |||||||
Land | $ | 5.0 | $ | 7.4 | ||||
Buildings | 709.5 | 718.2 | ||||||
Machinery and equipment | 1,331.7 | 1,371.8 | ||||||
Construction in progress | 63.5 | 15.1 | ||||||
Less accumulated depreciation | (1,581.3 | ) | (1,601.5 | ) | ||||
Property, plant, and equipment — net | $ | 528.4 | $ | 511.0 | ||||
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Period | ||||||||
1/1/2005 | ||||||||
through | Year Ended | |||||||
6/16/2005 | 2004 | |||||||
Depreciation expense | $ | 40.3 | $ | 90.7 | ||||
Period | ||||||||
1/1/2005 | ||||||||
through | Year Ended | |||||||
6/16/2005 | 2004 | |||||||
Interest capitalized | $ | 2.1 | $ | 4.9 | ||||
6. | COMMITMENTS |
Future Minimum Payments | ||||
6/17/05-12/31/05 | $ | 3.0 | ||
2006 | 4.3 | |||
2007 | 2.4 | |||
2008 | 2.2 | |||
2009 | 1.4 | |||
2010 | 0.6 | |||
Thereafter | 4.8 |
Period | ||||||||
1/1/2005 | ||||||||
through | Year Ended | |||||||
6/16/2005 | 2004 | |||||||
Total rent expense | $ | 4.3 | $ | 9.7 | ||||
7. | PENSION AND POSTRETIREMENT BENEFITS |
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Year Ended | Year Ended | |||||||
9/30/05 | 9/30/04 | |||||||
Pension plan assets | $ | 43,484 | $ | 38,977 | ||||
Pension plan benefit obligation | 45,183 | 42,781 |
Year Ended | Year Ended | |||||||
9/30/05 | 9/30/04 | |||||||
Postretirement benefits plan assets | $ | 82 | $ | 72 | ||||
Postretirement benefit obligation | 8,057 | 8,135 |
8. | SHARE-BASED PLANS |
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Period | ||||||||
1/1/2005 | ||||||||
through | Year Ended | |||||||
6/16/2005 | 2004 | |||||||
Performance shares | $ | 17.1 | $ | 18.5 | ||||
Period | ||||||||
1/1/2005 | ||||||||
through | Year Ended | |||||||
6/16/2005 | 2004 | |||||||
Share-value trust | $ | 2.0 | $ | 3.9 | ||||
Period | ||||||||
1/1/2005 | ||||||||
through | Year Ended | |||||||
6/16/2005 | 2004 | |||||||
Other share-based plan totals | $ | 3.0 | $ | 0.9 | ||||
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9. | CASH FLOW INFORMATION |
Period | ||||||||
1/1/2005 | ||||||||
through | Year Ended | |||||||
6/16/2005 | 2004 | |||||||
Cash flow from operating activities: | ||||||||
Intercompany cost of products transferred | $ | (1,163.9 | ) | $ | (2,074.3 | ) | ||
Period expenses | (90.7 | ) | (173.2 | ) | ||||
Net energy services | 0.2 | 0.0 | ||||||
Depreciation | 40.3 | 90.7 | ||||||
Changes in working capital: | ||||||||
Cash (KIESC) | (2.2 | ) | (0.6 | ) | ||||
Accounts receivable | 1.6 | 0.0 | ||||||
Inventories | 37.0 | 4.8 | ||||||
Prepaid expenses | 0.0 | 0.3 | ||||||
Accounts payable | 11.7 | (11.5 | ) | |||||
Accrued expenses | (4.1 | ) | (1.9 | ) | ||||
Employee vacation | (7.2 | ) | 0.8 | |||||
Accrued employee related expenses | (0.5 | ) | — | |||||
Net cash used by operating activities | (1,177.8 | ) | (2,164.9 | ) | ||||
Investing activities: | ||||||||
Capital expenditures | (48.2 | ) | (54.4 | ) | ||||
Net cash impact | $ | (1,226.0 | ) | $ | (2,219.3 | ) | ||
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10. | SIGNIFICANT CONCENTRATIONS OF RISK |
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Table of Contents
Item 13. | Other Expenses of Issuance and Distribution |
Securities and Exchange Commission registration fee | $ | |||
NASD filing fee | ||||
Accounting fees and expenses | ||||
Legal fees and expenses | ||||
Printing costs | ||||
Transfer agent and registrar fees | ||||
Miscellaneous fees and expenses | ||||
Total | $ | |||
Item 14. | Indemnification of Directors and Officers |
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Item 15. | Recent Sales of Unregistered Securities |
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Item 16. | Exhibits and Financial Data Schedules |
1 | .1 | Form of Underwriting Agreement. | ||
2 | .1 | Asset Purchase Agreement, dated as of February 22, 2005, between Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.) and The Boeing Company.* | ||
2 | .2 | First Amendment to Asset Purchase Agreement, dated June 15, 2005, between Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.) and The Boeing Company.* | ||
3 | .1 | Form of Second Amended and Restated Certificate of Incorporation of Spirit AeroSystems Holdings, Inc.*** | ||
3 | .2 | Form of Second Amended and Restated By-Laws of Spirit AeroSystems Holdings, Inc.*** | ||
4 | .1 | Form of Class A Common Stock Certificate.***** | ||
4 | .2 | Form of Class B Common Stock Certificate.***** |
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4 | .3 | Investor Stockholders Agreement, dated June 16, 2005, among Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Onex Partners LP and the stockholders listed on the signature pages thereto.* | ||
4 | .4 | Registration Agreement, dated June 16, 2005, among Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.) and the persons listed on Schedule A thereto.* | ||
5 | .1 | Opinion of Kaye Scholer LLP with respect to legality of securities being registered.****** | ||
10 | .1 | Employment Agreement, dated June 16, 2005, between Jeffrey L. Turner and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.).* | ||
10 | .2 | Employment Agreement, dated August 3, 2005, between Ulrich Schmidt and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.).* | ||
10 | .3 | Employment Agreement, dated September 13, 2005, between Spirit AeroSystems, Inc. and H. David Walker.* | ||
10 | .4 | Employment Agreement, dated December 28, 2005, between Spirit AeroSystems, Inc. and John Lewelling.* | ||
10 | .5 | Employment Agreement, dated December 30, 2005, between Spirit AeroSystems, Inc. and Janet S. Nicolson.* | ||
10 | .6 | Employment Agreement, dated March 20, 2006, between Spirit AeroSystems (Europe) Limited and Neil McManus.* | ||
10 | .7 | Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.) Executive Incentive Plan.* | ||
10 | .8 | Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.) Supplemental Executive Retirement Plan.* | ||
10 | .9 | Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.) Short Term Incentive Plan.* | ||
10 | .10 | Spirit AeroSystems Holdings, Inc. Long-Term Incentive Plan.* | ||
10 | .11 | Spirit AeroSystems Holdings, Inc. Cash Incentive Plan.* | ||
10 | .12 | Spirit AeroSystems Holdings, Inc. Union Equity Participation Plan.*** | ||
10 | .13 | Spirit AeroSystems Holdings, Inc. Director Stock Plan.* | ||
10 | .14 | Form of Indemnification Agreement.** | ||
10 | .15 | Intercompany Agreement, dated June 30, 2005, by and among Onex Partners Manager L.P. and Spirit AeroSystems, Inc.* | ||
10 | .16 | Consulting Agreement, dated as of February 25, 2005, between Gephardt and Associates LLC and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.).* | ||
10 | .17 | Amended and Restated Credit Agreement, dated as of July 20, 2005, among Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems Holdings, Inc.), Onex Wind Finance LP, the guarantors party thereto, Citicorp North America, Inc. and the other lenders party thereto.* | ||
10 | .18 | Amendment No. 1 to the Amended and Restated Credit Agreement, dated as of December 11, 2005, among Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems Holdings, Inc.), Onex Wind Finance LP, the guarantors party thereto, Citicorp North America, Inc. and the other lenders party thereto.* | ||
10 | .19 | Amendment No. 2 to the Amended and Restated Credit Agreement, dated as of March 31, 2006, among Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems Holdings, Inc.), Onex Wind Finance LP, the guarantors party thereto, Citicorp North America, Inc. and the other lenders party thereto.* | ||
10 | .20 | Security Agreement, dated as of June 16, 2005, made by Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems Holdings, Inc.), Onex Wind Finance LP, 3101447 Nova Scotia Company, Onex Wind Finance LLC and Citicorp North America, Inc., as collateral agent.* | ||
10 | .21 | Credit Agreement, dated as of June 16, 2005, among Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems Holdings, Inc.), Onex Wind Finance LP, 3101447 Nova Scotia Company, the other guarantor party thereto, and The Boeing Company.* |
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10 | .22 | Security Agreement, dated as of June 16, 2005, made by Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems Holdings, Inc.), Spirit AeroSystems Finance, Inc. (f/k/a Mid-Western Aircraft Finance, Inc.), Onex Wind Finance LP, 3101447 Nova Scotia Company, Onex Wind Finance LLC and The Boeing Company, as agent.* | ||
10 | .23 | Special Business Provisions (Sustaining), dated as of June 16, 2005, between The Boeing Company and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.).*† | ||
10 | .24 | General Terms Agreement (Sustaining and others), dated as of June 16, 2005, between The Boeing Company and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.).*† | ||
10 | .25 | Hardware Material Services General Terms Agreement, dated as of June 16, 2005, between The Boeing Company and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.).*† | ||
10 | .26 | Ancillary Know-How Supplemental License Agreement between The Boeing Company and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), entered into as of June 16, 2005.*† | ||
10 | .27 | Sublease Agreement, dated as of June 16, 2005, among The Boeing Company, Boeing IRB Asset Trust and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc).* | ||
10 | .28 | Spirit AeroSystems Holdings, Inc. Amended and Restated Long-Term Incentive Plan.**** | ||
10 | .29 | Amendment to the Amended and Restated Credit Agreement, dated as of November 27, 2006, by and among Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Spirit AeroSystems Holdings, Inc., (f/k/a Mid-Western Aircraft Systems Holdings, Inc.), Onex Wind Finance LP, the guarantor party thereto, Citicorp North America, Inc. and the other lenders party thereto.****** | ||
10 | .30 | Second Amended and Restated Credit Agreement by and among Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), the guarantor party thereto, Citicorp North America, Inc. and the other lenders party thereto.****** | ||
21 | .1 | Subsidiaries of Spirit AeroSystems Holdings, Inc. | ||
23 | .1 | Consent of PricewaterhouseCoopers LLP. | ||
23 | .2 | Consent of Deloitte & Touche LLP. | ||
23 | .3 | Consent of Kaye Scholer LLP (included in Exhibit 5.1).******* | ||
24 | .1 | Powers of Attorney of the directors of Spirit AeroSystems Holdings, Inc. (included in the signature page to the registration statement). |
* | Incorporated herein by reference to the Spirit AeroSystems Holdings, Inc. Registration Statement onForm S-1 (FileNo. 333-135486), filed with the Securities and Exchange Commission on June 30, 2006. | |
** | Incorporated herein by reference to the Spirit AeroSystems Holdings, Inc. Amendment No. 1 to Registration Statement onForm S-1/A (FileNo. 333-135486), filed with the Securities and Exchange Commission on August 29, 2006. | |
*** | Incorporated herein by reference to the Spirit AeroSystems Holdings, Inc. Amendment No. 2 to Registration Statement onForm S-1/A (FileNo. 333-135486), filed with the Securities and Exchange Commission on October 30, 2006. | |
**** | Incorporated herein by reference to the Spirit AeroSystems Holdings, Inc. Amendment No. 3 to Registration Statement onForm S-1/A (FileNo. 333-135486), filed with the Securities and Exchange Commission on November 6, 2006. | |
***** | Incorporated herein by reference to the Spirit AeroSystems Holdings, Inc. Amendment No. 5 to Registration Statement onForm S-1/A (FileNo. 333-135486), filed with the Securities and Exchange Commission on November 17, 2006. | |
****** | Incorporated herein by reference to the Current Report onForm 8-K of Spirit AeroSystems Holdings, Inc. (FileNo. 001-33160), filed with the Securities and Exchange Commission on December 1, 2006. | |
******* | To be filed by amendment. | |
† | Confidential treatment previously granted. Confidential portions of this document have been redacted and filed separately with the Securities and Exchange Commission. |
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(b) | Financial Data Schedule |
Balance | Charge to | Write-offs | Balance | |||||||||||||||||||||
December 29, | Costs and | Net of | Purchased | Exchange | December 31, | |||||||||||||||||||
2005 | Expenses | Recoveries | Reserves(1) | Rate | 2006 | |||||||||||||||||||
Tax valuation | $ | 47.1 | $ | (47.1 | ) | $ | — | $ | — | $ | — | $ | — | |||||||||||
Inventory — obsolete and surplus | 16.8 | (3.2 | ) | (0.1 | ) | 1.5 | 0.2 | 15.2 | ||||||||||||||||
Warranties | 0.9 | 5.6 | — | 2.8 | 0.3 | 9.6 | ||||||||||||||||||
Allowance for doubtful accounts | 0.6 | — | — | — | — | 0.6 |
(1) | Related to the BAE Acquisition |
Item 17. | Undertakings |
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Table of Contents
By: | /s/ Ulrich Schmidt |
Signature | Title | Date | ||||
/s/ Jeffrey L. Turner | President and Chief Executive Officer, Director (Principal Executive Officer) | May 7, 2007 | ||||
/s/ Ulrich Schmidt | Executive Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer) | May 7, 2007 | ||||
/s/ D. Randolph Davis | Corporate Controller (Principal Accounting Officer) | May 7, 2007 | ||||
/s/ Ivor Evans | Director | May 7, 2007 |
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Signature | Title | Date | ||||
/s/ Paul Fulchino | Director | May 7, 2007 | ||||
/s/ Richard Gephardt | Director | May 7, 2007 | ||||
/s/ Robert Johnson | Director | May 7, 2007 | ||||
/s/ Ronald Kadish | Director | May 7, 2007 | ||||
/s/ Cornelius McGillicuddy, III | Director | May 7, 2007 | ||||
/s/ Seth Mersky | Director | May 7, 2007 | ||||
/s/ Francis Raborn | Director | May 7, 2007 | ||||
/s/ Nigel Wright | Director | May 7, 2007 |
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Exhibit | ||||
Number | Description | |||
1 | .1 | Form of Underwriting Agreement. | ||
2 | .1 | Asset Purchase Agreement, dated as of February 22, 2005, between Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.) and The Boeing Company.* | ||
2 | .2 | First Amendment to Asset Purchase Agreement, dated June 15, 2005, between Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.) and The Boeing Company.* | ||
3 | .1 | Form of Second Amended and Restated Certificate of Incorporation of Spirit AeroSystems Holdings, Inc.*** | ||
3 | .2 | Form of Second Amended and Restated By-Laws of Spirit AeroSystems Holdings, Inc.*** | ||
4 | .1 | Form of Class A Common Stock Certificate.***** | ||
4 | .2 | Form of Class B Common Stock Certificate.***** | ||
4 | .3 | Investor Stockholders Agreement, dated June 16, 2005, among Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Onex Partners LP and the stockholders listed on the signature pages thereto.* | ||
4 | .4 | Registration Agreement, dated June 16, 2005, among Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.) and the persons listed on Schedule A thereto.* | ||
5 | .1 | Opinion of Kaye Scholer LLP with respect to legality of securities being registered.****** | ||
10 | .1 | Employment Agreement, dated June 16, 2005, between Jeffrey L. Turner and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.).* | ||
10 | .2 | Employment Agreement, dated August 3, 2005, between Ulrich Schmidt and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.).* | ||
10 | .3 | Employment Agreement, dated September 13, 2005, between Spirit AeroSystems, Inc. and H. David Walker.* | ||
10 | .4 | Employment Agreement, dated December 28, 2005, between Spirit AeroSystems, Inc. and John Lewelling.* | ||
10 | .5 | Employment Agreement, dated December 30, 2005, between Spirit AeroSystems, Inc. and Janet S. Nicolson.* | ||
10 | .6 | Employment Agreement, dated March 20, 2006, between Spirit AeroSystems (Europe) Limited and Neil McManus.* | ||
10 | .7 | Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.) Executive Incentive Plan.* | ||
10 | .8 | Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.) Supplemental Executive Retirement Plan.* | ||
10 | .9 | Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.) Short Term Incentive Plan.* | ||
10 | .10 | Spirit AeroSystems Holdings, Inc. Long-Term Incentive Plan.* | ||
10 | .11 | Spirit AeroSystems Holdings, Inc. Cash Incentive Plan.* | ||
10 | .12 | Spirit AeroSystems Holdings, Inc. Union Equity Participation Plan.*** | ||
10 | .13 | Spirit AeroSystems Holdings, Inc. Director Stock Plan.* | ||
10 | .14 | Form of Indemnification Agreement.** | ||
10 | .15 | Intercompany Agreement, dated June 30, 2005, by and among Onex Partners Manager L.P. and Spirit AeroSystems, Inc.* | ||
10 | .16 | Consulting Agreement, dated as of February 25, 2005, between Gephardt and Associates LLC and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.).* | ||
10 | .17 | Amended and Restated Credit Agreement, dated as of July 20, 2005, among Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems Holdings, Inc.), Onex Wind Finance LP, the guarantors party thereto, Citicorp North America, Inc. and the other lenders party thereto.* | ||
10 | .18 | Amendment No. 1 to the Amended and Restated Credit Agreement, dated as of December 11, 2005, among Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems Holdings, Inc.), Onex Wind Finance LP, the guarantors party thereto, Citicorp North America, Inc. and the other lenders party thereto.* |
Table of Contents
Exhibit | ||||
Number | Description | |||
10 | .19 | Amendment No. 2 to the Amended and Restated Credit Agreement, dated as of March 31, 2006, among Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems Holdings, Inc.), Onex Wind Finance LP, the guarantors party thereto, Citicorp North America, Inc. and the other lenders party thereto.* | ||
10 | .20 | Security Agreement, dated as of June 16, 2005, made by Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems Holdings, Inc.), Onex Wind Finance LP, 3101447 Nova Scotia Company, Onex Wind Finance LLC and Citicorp North America, Inc., as collateral agent.* | ||
10 | .21 | Credit Agreement, dated as of June 16, 2005, among Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems Holdings, Inc.), Onex Wind Finance LP, 3101447 Nova Scotia Company, the other guarantor party thereto, and The Boeing Company.* | ||
10 | .22 | Security Agreement, dated as of June 16, 2005, made by Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Spirit AeroSystems Holdings, Inc. (f/k/a Mid-Western Aircraft Systems Holdings, Inc.), Spirit AeroSystems Finance, Inc. (f/k/a Mid-Western Aircraft Finance, Inc.), Onex Wind Finance LP, 3101447 Nova Scotia Company, Onex Wind Finance LLC and The Boeing Company, as agent.* | ||
10 | .23 | Special Business Provisions (Sustaining), dated as of June 16, 2005, between The Boeing Company and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.).*† | ||
10 | .24 | General Terms Agreement (Sustaining and others), dated as of June 16, 2005, between The Boeing Company and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.).*† | ||
10 | .25 | Hardware Material Services General Terms Agreement, dated as of June 16, 2005, between The Boeing Company and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.).*† | ||
10 | .26 | Ancillary Know-How Supplemental License Agreement between The Boeing Company and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), entered into as of June 16, 2005.*† | ||
10 | .27 | Sublease Agreement, dated as of June 16, 2005, among The Boeing Company, Boeing IRB Asset Trust and Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc).* | ||
10 | .28 | Spirit AeroSystems Holdings, Inc. Amended and Restated Long-Term Incentive Plan.**** | ||
10 | .29 | Amendment to the Amended and Restated Credit Agreement, dated as of November 27, 2006, by and among Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), Spirit AeroSystems Holdings, Inc., (f/k/a Mid-Western Aircraft Systems Holdings, Inc.), Onex Wind Finance LP, the guarantor party thereto, Citicorp North America, Inc. and the other lenders party thereto.****** | ||
10 | .30 | Second Amended and Restated Credit Agreement by and among Spirit AeroSystems, Inc. (f/k/a Mid-Western Aircraft Systems, Inc.), the guarantor party thereto, Citicorp North America, Inc. and the other lenders party thereto.****** | ||
21 | .1 | Subsidiaries of Spirit AeroSystems Holdings, Inc. | ||
23 | .1 | Consent of PricewaterhouseCoopers LLP. | ||
23 | .2 | Consent of Deloitte & Touche LLP. | ||
23 | .3 | Consent of Kaye Scholer LLP (included in Exhibit 5.1).******* | ||
24 | .1 | Powers of Attorney of the directors of Spirit AeroSystems Holdings, Inc. (included in the signature page to the registration statement). |
* | Incorporated herein by reference to the Spirit AeroSystems Holdings, Inc. Registration Statement onForm S-1 (FileNo. 333-135486), filed with the Securities and Exchange Commission on June 30, 2006. | |
** | Incorporated herein by reference to the Spirit AeroSystems Holdings, Inc. Amendment No. 1 to Registration Statement onForm S-1/A (FileNo. 333-135486), filed with the Securities and Exchange Commission on August 29, 2006. | |
*** | Incorporated herein by reference to the Spirit AeroSystems Holdings, Inc. Amendment No. 2 to Registration Statement onForm S-1/A (FileNo. 333-135486), filed with the Securities and Exchange Commission on October 30, 2006. |
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**** | Incorporated herein by reference to the Spirit AeroSystems Holdings, Inc. Amendment No. 3 to Registration Statement onForm S-1/A (FileNo. 333-135486), filed with the Securities and Exchange Commission on November 6, 2006. | |
***** | Incorporated herein by reference to the Spirit AeroSystems Holdings, Inc. Amendment No. 5 to Registration Statement onForm S-1/A (FileNo. 333-135486), filed with the Securities and Exchange Commission on November 17, 2006. | |
****** | Incorporated herein by reference to the Current Report onForm 8-K of Spirit AeroSystems Holdings, Inc. (FileNo. 001-33160), filed with the Securities and Exchange Commission on December 1, 2006. | |
******* | To be filed by amendment. | |
† | Confidential treatment previously granted. Confidential portions of this document have been redacted and filed separately with the Securities and Exchange Commission. |