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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended
September 30, 1995
Commission file number 1-442
THE BOEING COMPANY
7755 East Marginal Way South
Seattle, Washington 98108
Telephone: (206) 655-2121
State of incorporation: Delaware
IRS identification number: 91-0425694
The registrant has filed all reports required to be filed by Section 13 or
15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
and has been subject to such filing requirements for the past 90 days.
As of October 31, 1995, there were 343,146,400 shares of common stock, $5.00
par value, issued and outstanding.
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
THE BOEING COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF NET EARNINGS
(Dollars in millions except per share data)
(Unaudited)
Nine months ended Three months ended
September 30 September 30
- ------------------------------------------------------------------------------
1995 1994 1995 1994
- ------------------------------------------------------------------------------
Sales and other operating revenues $14,976 $16,804 $4,381 $5,063
Costs and expenses 14,214 15,875 4,158 4,837
Special retirement program expense 600
- ------------------------------------------------------------------------------
Earnings from operations 162 929 223 226
Other income, principally interest 147 90 60 41
Interest and debt expense (118) (90) (39) (33)
- ------------------------------------------------------------------------------
Earnings before federal taxes on income 191 929 244 234
Federal taxes on income 16 230 19 49
- ------------------------------------------------------------------------------
Net earnings $ 175 $ 699 $ 225 $ 185
==============================================================================
Earnings per share $ .51 $2.05 $ .66 $ .54
==============================================================================
Cash dividends per share $ .75 $ .75 $ .25 $ .25
==============================================================================
See notes to consolidated financial statements.
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THE BOEING COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Dollars in millions except per share data)
September 30 December 31
1995 1994
- ------------------------------------------------------------------------------
(Unaudited)
Assets
- ------------------------------------------------------------------------------
Cash and cash equivalents $ 4,201 $ 2,084
Short-term investments 559
Accounts receivable 1,406 1,664
Current portion of customer financing 78 250
Deferred income taxes 720 878
Inventories 13,067 11,269
Less advances and progress billings (7,167) (6,290)
- ------------------------------------------------------------------------------
Total current assets 12,305 10,414
Customer financing 2,019 3,071
Property, plant and equipment, at cost 13,828 13,588
Less accumulated depreciation (7,254) (6,786)
Other assets 827 1,176
- ------------------------------------------------------------------------------
$21,725 $21,463
==============================================================================
Liabilities and Shareholders' Equity
- ------------------------------------------------------------------------------
Accounts payable and other liabilities $ 6,407 $ 6,267
Advances in excess of related costs 189 273
Income taxes payable 290 281
Current portion of long-term debt 262 6
- ------------------------------------------------------------------------------
Total current liabilities 7,148 6,827
Deferred income taxes 19 51
Accrued retiree health care 2,401 2,282
Long-term debt 2,355 2,603
Shareholders' equity:
Common shares, par value $5.00 -
600,000,000 shares authorized;
349,256,792 shares issued 1,746 1,746
Additional paid-in capital 599 586
Retained earnings 7,700 7,696
Less treasury shares, at cost -
1995 - 6,186,306; 1994 - 8,377,637 (243) (328)
- ------------------------------------------------------------------------------
Total shareholders' equity 9,802 9,700
- ------------------------------------------------------------------------------
$21,725 $21,463
==============================================================================
See notes to consolidated financial statements.
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THE BOEING COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in millions)
(Unaudited)
Nine months ended
September 30
- ------------------------------------------------------------------------------
1995 1994
- ------------------------------------------------------------------------------
Cash flows - operating activities:
Net earnings $ 175 $ 699
Adjustments to reconcile net earnings to net cash
provided by operating activities:
Special retirement program expense 600
Depreciation and amortization 809 744
Changes in assets and liabilities -
Short-term investments 559 31
Accounts receivable 258 30
Inventories, net of advances and progress billings (921) (992)
Accounts payable and other liabilities 223 313
Advances in excess of related costs (84) (23)
Income taxes payable and deferred 135 (172)
Other assets (249) (217)
Accrued retiree health care 119 102
- ------------------------------------------------------------------------------
Net cash provided by operating activities 1,624 515
- ------------------------------------------------------------------------------
Cash flows - investing activities:
Customer financing additions (658) (560)
Customer financing reductions 1,839 326
Plant and equipment, net additions (538) (524)
- ------------------------------------------------------------------------------
Net cash provided (used) by investing activities 643 (758)
- ------------------------------------------------------------------------------
Cash flows - financing activities:
Debt financing 8 (5)
Shareholders' equity -
Cash dividends paid (256) (255)
Stock options exercised, other 98 22
- ------------------------------------------------------------------------------
Net cash used by financing activities (150) (238)
- ------------------------------------------------------------------------------
Net increase (decrease) in cash and cash equivalents 2,117 (481)
Cash and cash equivalents at beginning of year 2,084 2,342
- ------------------------------------------------------------------------------
Cash and cash equivalents at end of 3rd quarter $4,201 $1,861
==============================================================================
See notes to consolidated financial statements.
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THE BOEING COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in millions)
(Unaudited)
Note 1 - Consolidated Financial Statements
The consolidated interim financial statements included in this report have
been prepared by the Company without audit. In the opinion of management,
all adjustments necessary for a fair presentation are reflected in the interim
financial statements. Such adjustments are of a normal and recurring nature.
The results of operations for the period ended September 30, 1995, are not
necessarily indicative of the operating results for the full year. The
interim financial statements should be read in conjunction with the audited
financial statements and notes thereto included in the Company's 1994 Annual
Report.
Note 2 - Earnings per Share
Earnings per share are computed on the basis of the weighted average number of
shares outstanding during the period. The weighted average number of shares
was 341.8 million and 340.5 million for the nine-month periods ended September
30, 1995 and 1994. There was no material dilutive effect on earnings per share
due to common stock equivalents.
Note 3 - Special Retirement Program
A special retirement program was offered during the first half of 1995 to
encourage early retirements, resulting in a pre-tax charge of $600. The
special retirement program will be funded over a minimum of ten years through
the Company's retirement plan. The valuation of the special retirement program
included the effect of a lower discount rate as of the measurement date for
calculating the projected benefit obligation of the retirement plan. The
projected benefit obligation at June 30, 1995, the date at which the special
retirement program expense was recognized, was determined using a weighted
average discount rate of 7.75%, compared with 8.5% at December 31, 1994.
The special retirement program did not result in an additional retiree health
care accrual due to offsetting unrecognized actuarial gains.
Note 4 - Federal Taxes on Income
The federal income tax provision rate of 8.4% for the first nine months of
1995 is lower than the statutory rate principally due to a 16.1% reduction
attributable to research and experimentation tax credit and an 11.5% reduction
attributable to Foreign Sales Corporation tax benefits. The federal income
tax provision rate was 24.7% for the first nine months of 1994 and included
reductions from the statutory rate of 5.9% for Foreign Sales Corporation tax
benefits and 5.5% for research and experimentation tax credit. In addition
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to higher absolute dollar values for tax credit benefits in 1995 compared with
1994, particularly for research and experimentation credit, the 1995 tax
credits result in higher relative percentage reductions to the statutory tax
rate because of the $600 charge to pre-tax earnings for the special retirement
program.
Income tax payments (refunds) were $(127) and $399 for the nine months ended
September 30, 1995 and 1994.
Note 5 - Accounts Receivable
Accounts receivable consisted of the following:
September 30 December 31
1995 1994
- ------------------------------------------------------------------------------
Accounts receivable under U.S. Government contracts $1,042 $1,200
Accounts receivable from commercial
and foreign military customers 364 464
- ------------------------------------------------------------------------------
$1,406 $1,664
==============================================================================
Accounts receivable at September 30, 1995 and December 31, 1994 included
amounts not currently billable of $241 and $349, respectively, principally
relating to sales values recorded upon attainment of scheduled performance
milestones which differ from contractual billing milestones, withholds on U.S.
Government contracts, and other amounts on U.S. Government contracts subject
to negotiation.
Note 6 - Inventories
Inventories consisted of the following:
September 30 December 31
1995 1994
- ------------------------------------------------------------------------------
Commercial jet transport programs
and long-term contracts in progress $12,166 $10,352
Commercial spare parts, general stock
materials and other 901 917
- ------------------------------------------------------------------------------
$13,067 $11,269
==============================================================================
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Note 7 - Customer Financing
Long-term customer financing, less current portion, consisted of the following:
September 30 December 31
1995 1994
- ------------------------------------------------------------------------------
Notes receivable $ 425 $1,189
Investment in sales-type leases 992 1,235
Operating lease aircraft, at cost, less
accumulated depreciation of $311 and $269 702 747
- ------------------------------------------------------------------------------
2,119 3,171
Less valuation allowance (100) (100)
- ------------------------------------------------------------------------------
$2,019 $3,071
==============================================================================
Financing for aircraft is collateralized by security in the related asset, and
historically the Company has not experienced a problem in accessing such
collateral when necessary.
Sales and other operating revenues for the first nine months of 1995 and 1994
included interest income associated with notes receivable and sales-type leases
of $130 and $130.
Note 8 - Other Assets
Other assets consisted of the following:
September 30 December 31
1995 1994
- ------------------------------------------------------------------------------
Prepaid pension expense $768 $1,115
Investments, other 59 61
- ------------------------------------------------------------------------------
$827 $1,176
==============================================================================
Prepaid pension expense as of September 30, 1995, included a $600 reduction for
the special retirement program expense.
Note 9 - Accounts Payable and Other Liabilities
Accounts payable and other liabilities consisted of the following:
September 30 December 31
1995 1994
- ------------------------------------------------------------------------------
Accounts payable $3,221 $3,207
Employee compensation and benefits 1,302 1,062
Lease and other deposits 692 640
Other 1,192 1,358
- ------------------------------------------------------------------------------
$6,407 $6,267
==============================================================================
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Note 10 - Long-Term Debt
The Company has $2,000 currently available under credit line agreements with a
group of commercial banks. Under these agreements, there are compensating
balance arrangements, and retained earnings totaling $1,470 are free from
dividend restrictions. The Company has complied with the restrictive covenants
contained in debt agreements.
Total debt interest, including amounts capitalized, was $162 and $163 for the
nine-month periods ended September 30, 1995 and 1994, and interest payments
were $160 and $163, respectively.
Note 11 - Shareholders' Equity
Changes in shareholders' equity for the nine-month periods ended September 30,
1995 and 1994 consisted of the following:
(Shares in thousands)
- -------------------------------------------------------------------------------
Common Stock
------------ Additional Treasury Stock
Par Paid-In Retained --------------
Shares Value Capital Earnings Shares Amount
- -------------------------------------------------------------------------------
Balance - December 31, 1993 349,257 $1,746 $413 $7,180 9,119 $(356)
- -------------------------------------------------------------------------------
Net earnings 699
Cash dividends declared (170)
Treasury shares issued for
incentive stock plans, net (8) (641) 24
Tax benefit related to
incentive stock plans 3
Transfer from contingent
stock repurchase provision 70
Stock appreciation rights
expired or surrendered 3
- -------------------------------------------------------------------------------
Balance - September 30, 1994 349,257 $1,746 $481 $7,709 8,478 $(332)
===============================================================================
- -------------------------------------------------------------------------------
Balance - December 31, 1994 349,257 $1,746 $586 $7,696 8,378 $(328)
- -------------------------------------------------------------------------------
Net earnings 175
Cash dividends declared (171)
Treasury shares issued for
incentive stock plans, net (8) (2,192) 85
Incentive stock plan accrual 8
Tax benefit related to
incentive stock plans 8
Stock appreciation rights
expired or surrendered 5
- -------------------------------------------------------------------------------
Balance - September 30, 1995 349,257 $1,746 $599 $7,700 6,186 $(243)
===============================================================================
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Note 12 - Contingencies
Various legal proceedings, claims and investigations are pending against the
Company related to products, contracts and other matters. Except for the items
discussed below, most of these legal proceedings are related to matters covered
by insurance.
In January 1991, the Company received from the U.S. Government a notice of
partial termination for default which terminated most of the work required
under contracts to develop and install a new air defense system for Saudi
Arabia, known as the Peace Shield program. In June 1991, the Government
selected another contractor to perform the work which is the subject of the
contracts that have been terminated for default, and the Government may assert
claims related to the reprocurement.
Management's position, supported by outside legal counsel which specializes in
government procurement law, is that the grounds for default asserted by the
Government in the Peace Shield termination are not legally supportable.
Accordingly, management and counsel are of the opinion that on appeal the
termination for default has a substantial probability of being converted to
termination for the convenience of the Government, which would eliminate any
Government claim for cost of reprocurement or other damages. Additionally,
the Company has a legal basis for a claim for equitable adjustment to the price
and schedules of the contracts (the "Contract Claim"). Many of the same facts
underlie both the Contract Claim and the Company's appeal of the Government's
termination action. The Company filed its complaint in the United States Court
of Federal Claims to overturn the default termination in order to obtain
payment of the Contract Claim.
In conjunction with the notice of partial termination in January 1991, the
Government demanded the repayment of unliquidated progress payments in the
amount of $605 plus interest. In April 1995, the parties executed an agreement
deferring the Company's potential obligation to repay the $605 from January 25,
1991, until a decision of the court or earlier settlement. The deferment
agreement is subject to annual review by the Government.
The parties have been engaged in the discovery phase of the litigation, with
the trial scheduled for March 1997, and have concurrently engaged in
discussions which could lead to final settlement. On October 20, 1995, the
court determined all activities in the lawsuit would be "suspended in light of
the prospect of settlement." There can be no assurance that the Government
will agree to final settlement on terms acceptable to the Company. If a final
settlement is not reached, the Company expects that its position will
ultimately be upheld with respect to the termination action and that it will
recover on the Contract Claim.
The Company's financial statements have been prepared on the basis of a
conservative estimate of the Contract Claim and the Company's position that
the termination was for the convenience of the Government. If a final
settlement is not reached, the Company cannot, at this time, reasonably
estimate the length of time that will be required to resolve the termination
appeal and the Contract Claim. In the event that final settlement does not
occur and the Company's appeal of the termination for default is not
successful, the Company could realize a pretax loss on the program
approximating the value of the unliquidated progress payments plus related
interest and potential damages assessed by the Government.
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REVIEW BY INDEPENDENT ACCOUNTANTS
The consolidated statement of financial position as of September 30, 1995, and
the consolidated statements of net earnings and cash flows for the nine-month
periods ended September 30, 1995 and 1994, have been reviewed by the
registrant's independent accountants, Deloitte & Touche LLP, whose report
covering their review of the financial statements follows.
INDEPENDENT ACCOUNTANTS' REVIEW REPORT
Board of Directors and Shareholders
The Boeing Company
Seattle, Washington
We have reviewed the accompanying condensed consolidated statement of financial
position of The Boeing Company and subsidiaries as of September 30, 1995, and
the related condensed consolidated statements of net earnings and cash flows
for the nine-month periods ended September 30, 1995 and 1994. These financial
statements are the responsibility of the Company's management.
We conducted our review in accordance with the standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and of making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted
in accordance with generally accepted auditing standards, the objective of
which is the expression of an opinion regarding the financial statements taken
as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to such consolidated financial statements for them to be in conformity
with generally accepted accounting principles.
We previously audited, in accordance with generally accepted auditing
standards, the consolidated statement of financial position of The Boeing
Company and subsidiaries as of December 31, 1994, and the related consolidated
statements of net earnings, shareholders' equity, and cash flows for the year
then ended (not presented herein); and in our report dated January 25, 1995,
we expressed an unqualified opinion on those consolidated financial statements,
but we have not performed any auditing procedures since that date. In our
opinion, the information set forth in the accompanying consolidated statement
of financial position as of December 31, 1994, is fairly stated, in all
material respects, in relation to the consolidated statement of financial
position from which it has been derived.
/s/ Deloitte & Touche LLP
Deloitte & Touche LLP
Seattle, Washington
October 26, 1995
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Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations
Sales of $15.0 billion for the first nine months of 1995 were 11% below sales
for the comparable period of 1994 due to fewer commercial jet transport
deliveries. A total of 170 commercial jet transports were delivered,
compared with 214 in the first nine months of 1994.
Sales by business segment were as follows ($ in millions):
First Nine months Third Quarter
1995 1994 1995 1994
Commercial transportation $10,828 $13,178 $3,047 $3,843
Defense and space 4,148 3,626 1,334 1,220
------- ------- ------ ------
Total $14,976 $16,804 $4,381 $5,063
======= ======= ====== ======
Commercial jet transport deliveries were as follows:
First Nine months Third Quarter
Model 1995 1994 1995 1994
737 80 96 25 25
747 20 32 4 7
757 39 53 12 23
767 24 33 8 10
777 7 - 2 -
--- --- -- --
Total 170 214 51 65
=== === == ==
Net earnings of $175 million for the first nine months of 1995 reflects the
recognition of a $600 million one-time pre-tax charge for the special
retirement program offered in early 1995. Without the one-time special
retirement program charge, net earnings for the first nine months of 1995
would have been $624 million, $75 million lower than the comparable period of
1994. The lower comparable earnings were primarily due to the reduced level of
commercial jet transport deliveries, partially offset by lower research and
development expense. Additionally, for the first nine months of 1995 compared
with the first nine months of 1994, interest and debt expense was higher by
$28 million due to less interest being capitalized on plant and equipment
investments, and investment income was $57 million higher.
The first nine months' comparable earnings also reflect higher tax benefits
associated with research and experimentation tax credits, primarily associated
with the initial 777 development program. After the effect of the special
retirement program, the effective tax rate for the first nine months of 1995
was 8.4%, compared with 24.7% for the comparable period of 1994.
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The special retirement program, which was offered during the first half of
1995 to encourage early retirements, is expected to provide substantial
benefits as the Company continues to pursue major process improvement
initiatives. Approximately 9,500 individuals accepted the one-time early
retirement incentive. The after-tax impact of the one-time special retirement
program charge of $600 million will be $390 million as of year end, but was
$449 million as of September 30 because of financial reporting requirements
to use an estimated annualized income tax rate for interim periods. Funding
of the program will occur over a minimum of ten years through the Company's
retirement plan and will not have a significant impact on annual cash flow.
The overall operating profit margin, exclusive of research and development
expense and the special retirement program expense, was 11.7% for the first
nine months of 1995, compared with 13.4% for the comparable period of 1994,
and 13.0% for the full year 1994. The lower overall operating profit margin
is attributable to a combination of factors, principally the mix of commercial
aircraft program sales and a higher ratio of defense and space segment sales to
total sales (28% vs. 22%). Mature commercial jet transport programs normally
have higher operating margins than new programs. As deliveries of the new
777 jet transport increase and account for a higher percentage of total
commercial aircraft sales, there will be a dilutive impact on the overall
operating profit margin for the commercial aircraft segment, exclusive of
research and development expense.
Research and development expense of $994 million for the first nine months of
1995 was down $320 million from the same period last year due to reduced 777
developmental expenditures.
On October 5, 1995, the International Association of Machinists and Aerospace
Workers (IAM), which represents approximately 33,000 hourly employees,
initiated a labor strike. Although management cannot predict when a labor
settlement will be reached, the IAM strike will result in a substantial number
of delayed deliveries for the fourth quarter, with a corresponding decrease in
earnings. The extent of the impact on operating results and cash flow will
depend on the length of the strike. The Company is striving to negotiate an
agreement that balances the interests of employees, customers and shareholders.
The labor agreement with the United Auto Workers (UAW), representing
approximately 2,500 hourly employees at the Company's Philadelphia plant,
expired on October 5, and has been extended on a day-to-day basis with a 10-day
advance notification. Labor agreements with the Company's engineering
employees' bargaining units, representing approximately 21,000 employees,
expire in early December.
The airline industry has exhibited improving financial health which is
necessary for a return to higher commercial jet transport delivery levels.
In addition to favorable passenger traffic trends, revenue yields are improving
in many airline markets worldwide. While the longer-term forecast demand for
commercial jet transports indicates delivery requirements will increase
compared with current levels, the market environment is expected to remain
highly competitive. In addition to pursuing major process improvement
initiatives, the Company's complete product line and highly responsive customer
support network should continue to position the Company to deliver competitive
value and maintain profitable market leadership over the long term.
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Despite some minor delays in the certification schedule for the new 777 powered
by General Electric engines and potential minor delays associated with
certifying certain customer-furnished items, overall 777 certification and
production activities are progressing well. The initial GE-powered 777, which
was originally scheduled to be delivered to British Airways in late September,
is currently expected to be delivered in November. The latest new commercial
derivative, a freighter version of the 767, completed its certification process
and was first delivered to United Parcel Service in October. The 767 Freighter
shares substantial commonality with the 757 Freighter and offers flexible
payload and range capabilities.
The diversified programs of the Defense and Space segment continue to perform
well, with major schedule and technical milestones being met. During the third
quarter, the formal contract for 14 Chinook helicopters for Britain's Ministry
of Defense was signed, and the second 767 AWACS airframe for the Government of
Japan was delivered to the Wichita plant for modification. The first 2 of 4
767 AWACS for Japan are scheduled for final delivery in 1998. The Company has
continued to position itself to be actively involved in the space launch
business with the award of a 15-month contract for the next-generation launch
vehicle for the U.S. Air Force, called the Evolved Expendable Launch Vehicle.
The Defense and Space segment continues to assess commercial ventures that can
leverage the technical capabilities within the organization.
Liquidity and Capital Resources
Cash and short-term investments increased by $1,558 million during the first
nine months of 1995, largely due to the sell-off of customer financing notes
receivable. Although further sell-off of customer financing assets will occur
as circumstances allow, there will also be new customer financings related to
outstanding commitments. 777 inventory growth will continue to require cash
investments as the production rate builds.
The Company's financial liquidity position remains strong, with cash and short-
term investments totaling $4.2 billion at September 30, 1995, and total long-
term debt at 21% of total shareholders' equity plus debt. In the third quarter,
the Company reduced its revolving credit line amount from $3.0 billion to $2.0
billion.
As discussed in Note 12 to the Consolidated Financial Statements, the U.S.
Government has terminated for alleged default most of the work required under
contracts for a Saudi Arabia air defense system known as the Peace Shield
program and selected another contractor to perform the terminated work. In
conjunction with the notice of partial termination, the Government demanded
that the Company repay $605 million of Peace Shield unliquidated progress
payments. In April 1995, an agreement was executed deferring the Company's
potential obligation to repay the $605 million from January 25, 1991, until a
decision of the court or earlier settlement. The deferment agreement is
subject to annual review by the Government. Management believes that the
Government's grounds for default are not legally supportable and on appeal the
Government's position will be overturned. The Company filed its complaint in
the United States Court of Federal Claims to overturn the default termination
and submitted a Contract Claim for equitable adjustment to the contract prices
and schedules. The Company's financial statements assume that the termination
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for default will be overturned and that the Contract Claim will be settled in
the Company's favor. The parties have been engaged in the discovery phase of
the litigation, with the trial scheduled for March 1997, and have concurrently
engaged in discussions which could lead to final settlement. On October 20,
1995, the court determined all activities in the lawsuit would be "suspended
in light of the prospect of settlement." There can be no assurance that the
Government will agree to final settlement on terms acceptable to the Company.
If a final settlement is not reached, the Company expects that its position
will ultimately be upheld with respect to the termination action and that it
will recover on the Contract Claim. If the Company's appeal of the termination
for default is not successful, the Company could realize a pretax loss on the
program approximating the value of the unliquidated progress payments plus
related interest and potential damages.
Backlog
Contractual backlog (which excludes purchase options and announced orders for
which definitive contracts have not been executed, unobligated Government
contract values, and orders from customers which have filed for bankruptcy
protection) was as follows ($ in billions):
Sep. 30 June 30 Dec. 31
1995 1995 1994
Commercial aircraft $59.9 $57.6 $60.6
Defense and space 5.7 4.9 5.7
----- ----- -----
Total $65.6 $62.5 $66.3
===== ===== =====
Unobligated U.S. Government contract values not included in backlog totaled
$7.9 billion at September 30, 1995, $9.0 billion at June 30, 1995, and
$5.9 billion at December 31, 1994.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings
See Note 12 to the Consolidated Financial Statements for a discussion
of the Peace Shield termination.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits: (10) Material Contracts.
The Boeing Company Bank Credit Agreements.
(i) Amendment No. 1 dated as of September 28, 1995,
to the Bank Credit Agreement Entered Into as of
September 30, 1994. Filed herewith.
(ii) Amendment No. 1 dated as of September 28, 1995,
to the Amended and Restated Bank Credit Agreement
dated as of September 30, 1994. Filed herewith.
(iii) Amendment No. 2 dated as of September 29, 1995,
to the Bank Credit Agreement Entered Into as of
September 30, 1994. Filed herewith.
(iv) Amendment No. 2 dated as of September 29, 1995,
to the Amended and Restated Bank Credit Agreement
dated as of September 30, 1994. Filed herewith.
(15) Letter from independent accountants regarding
unaudited interim financial information. Page 15.
(b) Reports on Form 8-K:
No reports on Form 8-K were filed during the quarter
covered by this report.
- - - - - - -
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
THE BOEING COMPANY
(Registrant)
November 6, 1995 /s/ T. M. Budinich
---------------- -----------------------
(Date) T. M. Budinich
Vice President and Controller
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EXHIBIT (15)
Letter from Independent Accountants Regarding
Unaudited Interim Financial Information
The Boeing Company and Subsidiaries
The consolidated statement of financial position as of September 30, 1995, the
consolidated statements of net earnings for the nine-month periods ended
September 30, 1995 and 1994, and the statements of cash flows for the
nine-month periods ended September 30, 1995 and 1994, have been reviewed
by the registrant's independent accountants, Deloitte & Touche LLP, whose
letter regarding such unaudited interim financial information follows.
October 26, 1995
The Boeing Company
Seattle, Washington
We have made a review, in accordance with standards established by the American
Institute of Certified Public Accountants, of the unaudited interim financial
information of The Boeing Company and subsidiaries for the periods ended
September 30, 1995 and 1994, as indicated in our report dated October 26, 1995;
because we did not perform an audit, we expressed no opinion on that
information.
We are aware that our report referred to above, which is included in your
Quarterly Report on Form 10-Q for the quarter ended September 30, 1995, is
incorporated by reference in Registration Statement No. 33-46540 on Form S-3
and Prospectuses and in Registration Statement Nos. 2-48576, 2-93923, 33-25332,
33-31434, 33-43854, and 33-58798 on Form S-8.
We are also aware that the aforementioned report, pursuant to Rule 436(c)
under the Securities Act of 1933, is not considered a part of the Registration
Statements prepared or certified by an accountant or a report prepared or
certified by an accountant within the meaning of Sections 7 and 11 of that Act.
/s/ Deloitte & Touche LLP
Deloitte & Touche LLP
Seattle, Washington
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Exhibit 10 (i)
Amendment No. 1 dated as of September 28, 1995, to the
Bank Credit Agreement Entered Into as of September 30, 1994
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AMENDMENT NO. 1 TO THE
BOEING COMPANY BANK CREDIT AGREEMENT
Dated as of September 28, 1995
AMENDMENT NO. 1 TO THE BOEING COMPANY BANK CREDIT AGREEMENT among
The Boeing Company, a Delaware corporation (the "Company"), the banks,
financial institutions and other institutional lenders parties to the Credit
Agreement referred to below (collectively, the "Banks") and Citibank, N.A.,
as agent (the "Agent") for the Banks.
PRELIMINARY STATEMENTS:
(1) The Company, the Banks and the Agent have entered into a Bank Credit
Agreement dated as of September 30, 1994 (the "Credit Agreement"). Capitalized
terms not otherwise defined in this Amendment No. 1 have the same meanings as
specified in the Credit Agreement.
(2) The Company and the Banks have agreed to amend the Credit Agreement as
hereinafter set forth.
(3) The Company and the Banks have agreed to waive certain notice requirements
in Section 2.19(a) of the Credit Agreement relating as hereinafter set forth.
SECTION 1. Amendments to Credit Agreement. The Credit Agreement is, effective
as of the date hereof and subject to the satisfaction of the conditions
precedent set forth in Section 3, hereby amended as follows:
(a) Section 2.04 is amended in full to read as follows:
"2.04. Interest Rate on A Advances. The Company shall pay interest on the
unpaid principal amount of each A Advance made by each Bank from the date of
such A Advance until such principal amount shall be paid in full, at the
following rates per annum: (i) during each period in which such A Advance is
a Base Rate Advance, at a rate per annum equal at all times to the Base Rate
in effect from time to time, payable quarterly in arrears on the first day
of each January, April, July and October and on the Termination Date, and
(ii) during each period in which such A Advance is a Eurodollar Rate Advance,
at a rate per annum equal at all times during each relevant Interest Period
for such A Advance to the Eurodollar Rate for such Interest Period plus the
Applicable Margin, payable on the last day of each such Interest Period."
(b)Section 2.06 is amended in full to read as follows:
"Section 2.06. Fees. The Company agrees to pay to the Agent for the account
of each Bank a facility fee ("Facility Fee") on such Bank's Commitment,
without regard to usage. Such fee shall be payable for the periods from the
date hereof in the case of each Bank named in Section 1.02, and from the
effective date on which any other Bank becomes party hereto, until the
Termination Date at the rate of .05% per annum. Facility Fees shall be
payable in arrears on each January 1, April 1, July 1 and October 1 during the
term of this Agreement and on the Termination Date."
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(c) Section 9.01 is amended as follows:
(i) The definition of "Applicable Margin" shall be amended in full to read
as follows:
"'Applicable Margin'--Means 0.155%."
(ii) The reference to "September 29, 1995" in clause (i) of the definition
of "Termination Date" shall be replaced with a reference to "September
27, 1996".
SECTION 2. Waivers and Consent. The notice requirements in Section 2.19(a) of
the Credit Agreement are hereby waived solely in connection with the extension
of the Termination Date from September 29, 1995 to September 27, 1996.
SECTION 3. Conditions of Effectiveness. This Amendment No. 1 shall become
effective as of the date first above written when, and only when, on or before
September 28, 1995 the Agent shall have received counterparts of this Amendment
No. 1 executed by the Company and all of the Banks or, as to any of the Banks,
advice satisfactory to the Agent that such Bank has executed this Amendment
No. 1. This Amendment No. 1 is subject to the provisions of Section 8.01 of
the Credit Agreement.
SECTION 4. Representations and Warranties of the Company. The Company
represents and warrants as follows:
(a) This Amendment No. 1 has been duly executed and delivered by the Company.
This Amendment No. 1 is a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms.
(b) No Event of Default has occurred and is continuing.
SECTION 5. Reference to and Effect on the Credit Agreement and the Notes.
(a) On and after the effectiveness of this Amendment No. 1, each reference
in the Credit Agreement to "this Agreement", "hereunder", "hereof" or words
of like import referring to the Credit Agreement, and each reference in the
Notes to "the Credit Agreement", "thereunder", "thereof" or words of like
import referring to the Credit Agreement, shall mean and be a reference to
the Credit Agreement, as amended by this Amendment No. 1.
(b) The Credit Agreement, as specifically amended by this Amendment No. 1,
and the Notes are and shall continue to be in full force and effect and
are hereby in all respects ratified and confirmed.
(c) The execution, delivery and effectiveness of this Amendment No. 1 and the
waiver in Section 2 hereof shall not, except as expressly provided herein,
operate as a waiver of any right, power or remedy of any Bank or the Agent
under the Credit Agreement, nor constitute a waiver of any provision of
the Credit Agreement.
SECTION 6. Costs and Expenses. The Company agrees to pay on demand all costs
and expenses of the Agent in connection with the preparation, execution,
delivery and administration, modification and amendment of this Amendment No. 1
and the other instruments and documents to be delivered hereunder (including,
without limitation, the reasonable fees and expenses of counsel for the Agent).
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SECTION 7. Execution in Counterparts. This Amendment No. 1 may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute but one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Amendment No. 1 by telecopier shall be effective as delivery of a manually
executed counterpart of this Amendment No. 1.
SECTION 8. Governing Law. This Amendment No. 1 shall be governed by, and
construed in accordance with, the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to be
executed by their respective officers thereunto duly authorized, as of the
date first above written.
THE BOEING COMPANY
By _____________
Title:
CITIBANK, N.A., Individually and as Agent
By _____________
Title:
ABN AMRO BANK, N.V.
By _____________
Title:
BANK IV WICHITA, N.A.
By _____________
Title:
BANK OF AMERICA NATIONAL TRUST and SAVINGS ASSOCIATION
By _____________
Title:
BANKERS TRUST COMPANY
By _____________
Title:
THE BANK OF NEW YORK
By _____________
Title:
THE CHASE MANHATTAN BANK, N.A.
By _____________
Title:
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CHEMICAL BANK
By _____________
Title:
CREDIT LYONNAIS, NEW YORK BRANCH
By _____________
Title:
FIRST INTERSTATE BANK OF WASHINGTON, N.A.
By _____________
Title:
THE FIRST NATIONAL BANK OF BOSTON
By _____________
Title:
INTRUST BANK
By _____________
Title:
THE INDUSTRIAL BANK OF JAPAN, Ltd.
By _____________
Title:
THE LONG-TERM CREDIT BANK OF JAPAN, Ltd.
By _____________
Title:
THE MITSUBISHI TRUST AND BANKING CORPORATION
By _____________
Title:
MORGAN GUARANTY TRUST COMPANY OF NEW YORK
By _____________
Title:
NATIONAL WESTMINSTER BANK PLC
By _____________
Title:
PNC BANK, NATIONAL ASSOCIATION
By _____________
Title:
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SEATTLE-FIRST NATIONAL BANK
By _____________
Title:
THE SUMITOMO BANK, LIMITED
By _____________
Title:
THE SUMITOMO TRUST AND BANKING COMPANY, Ltd.
By _____________
Title:
TRUST COMPANY BANK, ATLANTA
By _____________
Title:
U.S. BANK OF WASHINGTON, N.A.
By _____________
Title:
WACHOVIA BANK OF NORTH CAROLINA, N.A.
By _____________
Title:
22
23
Exhibit 10 (ii)
Amendment No. 1 dated as of September 28, 1995, to the
Amended and Restated Bank Credit Agreement dated as of September 30, 1994
23
24
AMENDMENT NO. 1 TO THE BOEING COMPANY
AMENDED AND RESTATED BANK CREDIT AGREEMENT
Dated as of September 28, 1995
AMENDMENT NO. 1 TO THE BOEING COMPANY AMENDED AND RESTATED BANK CREDIT
AGREEMENT among The Boeing Company, a Delaware corporation (the "Company"),
the banks, financial institutions and other institutional lenders parties to
the Credit Agreement referred to below (collectively, the "Banks") and
Citibank, N.A., as agent (the "Agent") for the Banks.
PRELIMINARY STATEMENTS:
(1) The Company, the Banks and the Agent have entered into an Amended and
Restated Bank Credit Agreement dated as of September 30, 1994 (the
"Credit Agreement"). Capitalized terms not otherwise defined in this
Amendment No. 1 have the same meanings as specified in the Credit
Agreement.
(2) The Company and the Banks have agreed to amend the Credit Agreement as
hereinafter set forth.
SECTION 1. Amendments to Credit Agreement. The Credit Agreement is, effective
as of the date hereof and subject to the satisfaction of the conditions
precedent set forth in Section 2, hereby amended as follows:
(a) Section 2.04 is amended by deleting the pricing grid set forth therein and
inserting in lieu thereof a new pricing grid to read as follows:
Applicable Applicable
Margin Margin
Years 1-5 Years 6-7
- -----------------------------------------------------------------------------
(1) On each day on which the Company's
long-term senior unsecured debt is rated at
least A- by S&P or at least A3 by Moody's 0.125% 0.25%
(2) On each day on which the Company's
long-term senior unsecured debt is rated
lower than (1) but BBB+ or higher by S&P or
Baa1 or higher by Moody's 0.20% 0.325%
(3) On each day on which the Company's
long-term senior unsecured debt is rated
lower than (2) but BBB or higher by S&P and
Baa2 or higher by Moody's 0.225% 0.35%
(4) On each day on which the Company's
long-term senior unsecured debt is rated
BBB- or lower by S&P or Baa3 or lower by
Moody's 0.425% 0.55%
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(b) Section 2.06 is amended by deleting the pricing grid set forth therein
and inserting in lieu thereof a new pricing grid to read as follows:
Facility
Fee
- ----------------------------------------------------------------------------
(1) On each day on which the Company's long-term
senior unsecured debt is rated at least A- by S&P or at
least A3 by Moody's 0.08%
(2) On each day on which the Company's long-term
senior unsecured debt is rated lower than (1) but BBB+
or higher by S&P or Baa1 or higher by Moody's 0.10%
(3) On each day on which the Company's long-term
senior unsecured debt is rated lower than (2) but BBB
or higher by S&P and Baa2 or higher by Moody's 0.15%
(4) On each day on which the Company's long-term
senior unsecured debt is rated BBB- or lower by S&P or
Baa3 or lower by Moody's 0.20%
(c) Section 9.01 is amended by deleting the reference to "September 30, 2001"
in the definition of "Termination Date" and inserting in lieu thereof
a reference to "September 30, 2002".
SECTION 2. Conditions of Effectiveness. This Amendment No. 1 shall become
effective as of the date first above written when, and only when, on or before
September 28, 1995 the Agent shall have received counterparts of this
Amendment No. 1 executed by the Company and all of the Banks or, as to any of
the Banks, advice satisfactory to the Agent that such Bank has executed this
Amendment No. 1. This Amendment No. 1 is subject to the provisions of
Section 8.01 of the Credit Agreement.
SECTION 3. Representations and Warranties of the Company. The Company
represents and warrants as follows:
(a) This Amendment No. 1 has been duly executed and delivered by the Company.
This Amendment No. 1 is a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms.
(b) No Event of Default has occurred and is continuing.
SECTION 4. Reference to and Effect on the Credit Agreement and the Notes.
(a) On and after the effectiveness of this Amendment No. 1, each reference in
the Credit Agreement to "this Agreement", "hereunder", "hereof" or words
of like import referring to the Credit Agreement, and each reference in
the Notes to "the Credit Agreement", "thereunder", "thereof" or words of
like import referring to the Credit Agreement, shall mean and be a
reference to the Credit Agreement, as amended by this Amendment No. 1.
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(b) The Credit Agreement, as specifically amended by this Amendment No. 1,
and the Notes are and shall continue to be in full force and effect and
are hereby in all respects ratified and confirmed.
(c) The execution, delivery and effectiveness of this Amendment No. 1 shall
not, except as expressly provided herein, operate as a waiver of any right,
power or remedy of any Bank or the Agent under the Credit Agreement, nor
constitute a waiver of any provision of the Credit Agreement.
SECTION 5. Costs and Expenses. The Company agrees to pay on demand all costs
and expenses of the Agent in connection with the preparation, execution,
delivery and administration, modification and amendment of this Amendment No. 1
and the other instruments and documents to be delivered hereunder (including,
without limitation, the reasonable fees and expenses of counsel for the Agent).
SECTION 6. Execution in Counterparts. This Amendment No. 1 may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute but one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Amendment No. 1 by telecopier shall be effective as delivery of a manually
executed counterpart of this Amendment No. 1.
SECTION 7. Governing Law. This Amendment No. 1 shall be governed by, and
construed in accordance with, the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to be
executed by their respective officers thereunto duly authorized, as of the
date first above written.
THE BOEING COMPANY
By _____________
Title:
CITIBANK, N.A., Individually and as Agent
By _____________
Title:
ABN AMRO BANK, N.V.
By _____________
Title:
BANK IV WICHITA, N.A.
By _____________
Title:
BANK OF AMERICA NATIONAL TRUST and SAVINGS ASSOCIATION
By _____________
Title:
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BANKERS TRUST COMPANY
By _____________
Title:
THE BANK OF NEW YORK
By _____________
Title:
THE CHASE MANHATTAN BANK, N.A.
By _____________
Title:
CHEMICAL BANK
By _____________
Title:
CREDIT LYONNAIS, NEW YORK BRANCH
By _____________
Title:
FIRST INTERSTATE BANK OF WASHINGTON, N.A.
By _____________
Title:
THE FIRST NATIONAL BANK OF BOSTON
By _____________
Title:
INTRUST BANK
By _____________
Title:
THE INDUSTRIAL BANK OF JAPAN, Ltd.
By _____________
Title:
THE LONG-TERM CREDIT BANK OF JAPAN, Ltd.
By _____________
Title:
THE MITSUBISHI TRUST AND BANKING CORPORATION
By _____________
Title:
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MORGAN GUARANTY TRUST COMPANY OF NEW YORK
By _____________
Title:
NATIONAL WESTMINSTER BANK PLC
By _____________
Title:
PNC BANK, NATIONAL ASSOCIATION
By _____________
Title:
SEATTLE-FIRST NATIONAL BANK
By _____________
Title:
THE SUMITOMO BANK, LIMITED
By _____________
Title:
THE SUMITOMO TRUST AND BANKING COMPANY, Ltd.
By _____________
Title:
TRUST COMPANY BANK, ATLANTA
By _____________
Title:
U.S. BANK OF WASHINGTON, N.A.
By _____________
Title:
WACHOVIA BANK OF NORTH CAROLINA, N.A.
By _____________
Title:
28
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Exhibit 10 (iii)
Amendment No. 2 dated as of September 28, 1995, to the
Bank Credit Agreement Entered Into as of September 30, 1994
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AMENDMENT NO. 2 TO THE BOEING COMPANY
364-DAY BANK CREDIT AGREEMENT
Dated as of September 29, 1995
AMENDMENT NO. 2 TO THE BOEING COMPANY BANK CREDIT AGREEMENT among The Boeing
Company, a Delaware corporation (the "Company"), the banks, financial
institutions and other institutional lenders parties to the Credit Agreement
referred to below (collectively, the "Banks") and Citibank, N.A., as agent
(the "Agent") for the Banks.
PRELIMINARY STATEMENTS:
(1) The Company, the Banks and the Agent have entered into a Bank Credit
Agreement dated as of September 30, 1994, as amended by Amendment No. 1
dated as of September 28, 1995 (the "Credit Agreement"). Capitalized
terms not otherwise defined in this Amendment No. 2 have the same
meanings as specified in the Credit Agreement.
(2) The Company and the Banks have agreed to amend the Credit Agreement as
hereinafter set forth.
SECTION 1. Amendments to Credit Agreement. The Credit Agreement is, effective
as of the date hereof and subject to the satisfaction of the conditions
precedent set forth in Section 2, hereby amended as follows:
(a) Section 1.02 is amended by deleting such Section in its entirety and
inserting in lieu thereof a new Section 1.02 to read in its entirety as
follows:
"Section 1.02. Schedule of Banks and Commitments.
Bank Commitment
- -----------------------------------------------------------------
Citibank, N.A $100,000,000
Chase Manhattan Bank, N.A. 78,000,000
Long Term Credit Bank of Japan, Ltd. 78,000,000
Bankers Trust Company 67,000,000
Credit Lyonnais 67,000,000
Mitsubishi Trust and Banking Corp. 67,000,000
National Westminster Bank plc 67,000,000
ABN Amro Bank, N.V. 48,000,000
Bank of America, N.T.& S.A. 34,000,000
Bank of New York 34,000,000
First Interstate Bank of Washington, N.A. 34,000,000
Industrial Bank of Japan, Ltd. 34,000,000
Seattle-First National Bank 34,000,000
The Sumitomo Bank Ltd. 34,000,000
Wachovia Bank of North Carolina, N.A. 34,000,000
PNC Bank, N.A. 27,000,000
Bank of Tokyo 25,000,000
Morgan Guaranty Trust Company of New York 25,000,000
Nationsbank of Texas, N.A. 25,000,000
Sumitomo Trust & Banking Co. Ltd. 25,000,000
U.S. Bank of Washington, N.A. 25,000,000
First National Bank of Boston 20,000,000
Trust Company Bank, Atlanta 8,000,000
Bank IV, N.A. 7,000,000
Intrust Bank 3,000,000
--------------
Total $1,000,000,000
==============
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SECTION 2. Conditions of Effectiveness. This Amendment No. 2 shall become
effective as of the date first above written when, and only when, on or
before September 29, 1995 the Agent shall have received counterparts of this
Amendment No. 2 executed by the Company and all of the Banks or, as to any of
the Banks, advice satisfactory to the Agent that such Bank has executed this
Amendment No. 2. This Amendment No. 2 is subject to the provisions of Section
8.01 of the Credit Agreement.
SECTION 3. Representations and Warranties of the Company. The Company
represents and warrants as follows:
(a) This Amendment No. 2 has been duly executed and delivered by the Company.
This Amendment No. 2 is a legal, valid and binding obligation of the Company,
enforceable against the Company in accordance with its terms.
(b) No Event of Default has occurred and is continuing.
SECTION 4. Reference to and Effect on the Credit Agreement and the Notes.
(a) On and after the effectiveness of this Amendment No. 2, each reference in
the Credit Agreement to "this Agreement", "hereunder", "hereof" or words of
like import referring to the Credit Agreement, and each reference in the Notes
to "the Credit Agreement", "thereunder", "thereof" or words of like import
referring to the Credit Agreement, shall mean and be a reference to the
Credit Agreement, as amended by this Amendment No. 2.
(b) The Credit Agreement, as specifically amended by this Amendment No. 2, and
the Notes are and shall continue to be in full force and effect and are hereby
in all respects ratified and confirmed.
(c) The execution, delivery and effectiveness of this Amendment No. 2 shall not
except as expressly provided herein, operate as a waiver of any right, power or
remedy of any Bank or the Agent under the Credit Agreement, nor constitute a
waiver of any provision of the Credit Agreement.
SECTION 5. Costs and Expenses. The Company agrees to pay on demand all costs
and expenses of the Agent in connection with the preparation, execution,
delivery and administration, modification and amendment of this Amendment No. 2
and the other instruments and documents to be delivered hereunder (including,
without limitation, the reasonable fees and expenses of counsel for the Agent).
SECTION 6. Execution in Counterparts. This Amendment No. 2 may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute but one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Amendment No. 2 by telecopier shall be effective as delivery of a manually
executed counterpart of this Amendment No. 2.
SECTION 7. Governing Law. This Amendment No. 2 shall be governed by, and
construed in accordance with, the laws of the State of New York.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2 to be
executed by their respective officers thereunto duly authorized, as of the
date first above written.
THE BOEING COMPANY
By _____________
Title:
CITIBANK, N.A., Individually and as Agent
By _____________
Title:
ABN AMRO BANK, N.V.
By _____________
Title:
BANK IV, N.A.
By _____________
Title:
BANK OF AMERICA NATIONAL TRUST and SAVINGS ASSOCIATION
By _____________
Title:
BANKERS TRUST COMPANY
By _____________
Title:
THE BANK OF TOKYO, LTD.
By _____________
Title:
THE BANK OF NEW YORK
By _____________
Title:
THE CHASE MANHATTAN BANK, N.A.
By _____________
Title:
CREDIT LYONNAIS, NEW YORK BRANCH
By _____________
Title:
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FIRST INTERSTATE BANK OF WASHINGTON, N.A.
By _____________
Title:
THE FIRST NATIONAL BANK OF BOSTON
By _____________
Title:
INTRUST BANK
By _____________
Title:
THE INDUSTRIAL BANK OF JAPAN, Ltd.
By _____________
Title:
THE LONG-TERM CREDIT BANK OF JAPAN, Ltd.
By _____________
Title:
THE MITSUBISHI TRUST AND BANKING CORPORATION
By _____________
Title:
MORGAN GUARANTY TRUST COMPANY OF NEW YORK
By _____________
Title:
NATIONAL WESTMINSTER BANK PLC
By _____________
Title:
NATIONSBANK OF TEXAS, N.A.
By _____________
Title:
PNC BANK, NATIONAL ASSOCIATION
By _____________
Title:
SEATTLE-FIRST NATIONAL BANK
By _____________
Title:
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THE SUMITOMO BANK, LIMITED
By _____________
Title:
THE SUMITOMO TRUST AND BANKING COMPANY, Ltd.
By _____________
Title:
TRUST COMPANY BANK, ATLANTA
By _____________
Title:
U.S. BANK OF WASHINGTON, N.A.
By _____________
Title:
WACHOVIA BANK OF NORTH CAROLINA, N.A.
By _____________
Title:
34
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Exhibit 10 (iv)
Amendment No. 2 dated as of September 28, 1995, to the
Amended and Restated Bank Credit Agreement dated as of September 30, 1994
35
36
AMENDMENT NO. 2 TO THE BOEING COMPANY 7-YEAR
AMENDED AND RESTATED BANK CREDIT AGREEMENT
Dated as of September 29, 1995
AMENDMENT NO. 2 TO THE BOEING COMPANY AMENDED AND RESTATED BANK CREDIT
AGREEMENT among The Boeing Company, a Delaware corporation (the "Company"),
the banks, financial institutions and other institutional lenders parties
to the Credit Agreement referred to below (collectively, the "Banks") and
Citibank, N.A., as agent (the "Agent") for the Banks.
PRELIMINARY STATEMENTS:
(1) The Company, the Banks and the Agent have entered into an Amended and
Restated Bank Credit Agreement dated as of September 30, 1994, as
amended by Amendment No. 1 dated as of September 28, 1995 (the "Credit
Agreement"). Capitalized terms not otherwise defined in this Amendment
No. 2 have the same meanings as specified in the Credit Agreement.
(2) The Company and the Banks have agreed to amend the Credit Agreement as
hereinafter set forth.
SECTION 1. Amendments to Credit Agreement. The Credit Agreement is, effective
as of the date hereof and subject to the satisfaction of the conditions
precedent set forth in Section 2, hereby amended as follows:
(a) Section 1.02 is amended by deleting such Section in its entirety and
inserting in lieu thereof a new Section 1.02 to read in its entirety as
follows:
"Section 1.02. Schedule of Banks and Commitments.
Bank Commitment
- ------------------------------------------------------------------
Citibank, N.A $100,000,000
Chase Manhattan Bank, N.A. 78,000,000
Long Term Credit Bank of Japan, Ltd. 78,000,000
Bankers Trust Company 67,000,000
Credit Lyonnais 67,000,000
Mitsubishi Trust and Banking Corp. 67,000,000
National Westminster Bank plc 67,000,000
ABN Amro Bank, N.V. 48,000,000
Bank of America, N.T.& S.A. 34,000,000
Bank of New York 34,000,000
First Interstate Bank of Washington, N.A. 34,000,000
Industrial Bank of Japan, Ltd. 34,000,000
Seattle-First National Bank 34,000,000
The Sumitomo Bank Ltd. 34,000,000
Wachovia Bank of North Carolina, N.A. 34,000,000
PNC Bank, N.A. 27,000,000
Bank of Tokyo 25,000,000
Morgan Guaranty Trust Company of New York 25,000,000
Nationsbank of Texas, N.A. 25,000,000
Sumitomo Trust & Banking Co. Ltd. 25,000,000
U.S. Bank of Washington, N.A. 25,000,000
First National Bank of Boston 20,000,000
Trust Company Bank, Atlanta 8,000,000
Bank IV, N.A. 7,000,000
Intrust Bank 3,000,000
--------------
Total $1,000,000,000
==============
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(b) Section 2.17 is amended by deleting the reference to 2,200,000" set forth
therein and inserting in lieu thereof a reference to "$1,100,000,000".
SECTION 2. Conditions of Effectiveness. This Amendment No. 2 shall become
effective as of the date first above written when, and only when, on or before
September 29, 1995 the Agent shall have received counterparts of this Amendment
No. 2 executed by the Company and all of the Banks or, as to any of the Banks,
advice satisfactory to the Agent that such Bank has executed this Amendment
No. 2. This Amendment No. 2 is subject to the provisions of Section 8.01 of
the Credit Agreement.
SECTION 3. Representations and Warranties of the Company. The Company
represents and warrants as follows:
(a) This Amendment No. 2 has been duly executed and delivered by the Company.
This Amendment No. 2 is a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms.
(b) No Event of Default has occurred and is continuing.
SECTION 4. Reference to and Effect on the Credit Agreement and the Notes.
(a) On and after the effectiveness of this Amendment No. 2, each reference
in the Credit Agreement to "this Agreement", "hereunder", "hereof" or words
of like import referring to the Credit Agreement, and each reference in
the Notes to "the Credit Agreement", "thereunder", "thereof" or words of
like import referring to the Credit Agreement, shall mean and be a
reference to the Credit Agreement, as amended by this Amendment No. 2.
(b) The Credit Agreement, as specifically amended by this Amendment No. 2,
and the Notes are and shall continue to be in full force and effect and
are hereby in all respects ratified and confirmed.
(c) The execution, delivery and effectiveness of this Amendment No. 2 shall not
except as expressly provided herein, operate as a waiver of any right, power
or remedy of any Bank or the Agent under the Credit Agreement, nor constitute
a waiver of any provision of the Credit Agreement.
SECTION 5. Costs and Expenses. The Company agrees to pay on demand all costs
and expenses of the Agent in connection with the preparation, execution,
delivery and administration, modification and amendment of this Amendment No. 2
and the other instruments and documents to be delivered hereunder (including,
without limitation, the reasonable fees and expenses of counsel for the Agent).
SECTION 6. Execution in Counterparts. This Amendment No. 2 may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute but one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Amendment No. 2 by telecopier shall be effective as delivery of a manually
executed counterpart of this Amendment No. 2.
SECTION 7. Governing Law. This Amendment No. 2 shall be governed by, and
construed in accordance with, the laws of the State of New York.
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38
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2 to be
executed by their respective officers thereunto duly authorized, as of the
date first above written.
THE BOEING COMPANY
By _____________
Title:
CITIBANK, N.A., Individually and as Agent
By _____________
Title:
ABN AMRO BANK, N.V.
By _____________
Title:
BANK IV, N.A.
By _____________
Title:
BANK OF AMERICA NATIONAL TRUST and SAVINGS ASSOCIATION
By _____________
Title:
THE BANK OF TOKYO, LTD.
By _____________
Title:
BANKERS TRUST COMPANY
By _____________
Title:
THE BANK OF NEW YORK
By _____________
Title:
THE CHASE MANHATTAN BANK, N.A.
By _____________
Title:
CREDIT LYONNAIS, NEW YORK BRANCH
By _____________
Title:
38
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FIRST INTERSTATE BANK OF WASHINGTON, N.A.
By _____________
Title:
THE FIRST NATIONAL BANK OF BOSTON
By _____________
Title:
INTRUST BANK
By _____________
Title:
THE INDUSTRIAL BANK OF JAPAN, Ltd.
By _____________
Title:
THE LONG-TERM CREDIT BANK OF JAPAN, Ltd.
By _____________
Title:
THE MITSUBISHI TRUST AND BANKING CORPORATION
By _____________
Title:
MORGAN GUARANTY TRUST COMPANY OF NEW YORK
By _____________
Title:
NATIONAL WESTMINSTER BANK PLC
By _____________
Title:
NATIONSBANK OF TEXAS, N.A.
By _____________
Title:
PNC BANK, NATIONAL ASSOCIATION
By _____________
Title:
SEATTLE-FIRST NATIONAL BANK
By _____________
Title:
39
40
THE SUMITOMO BANK, LIMITED
By _____________
Title:
THE SUMITOMO TRUST AND BANKING COMPANY, Ltd.
By _____________
Title:
TRUST COMPANY BANK, ATLANTA
By _____________
Title:
U.S. BANK OF WASHINGTON, N.A.
By _____________
Title:
WACHOVIA BANK OF NORTH CAROLINA, N.A.
By _____________
Title:
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