1
EXHIBIT 99.1
RAYTHEON SAVINGS AND INVESTMENT PLAN
FINANCIAL STATEMENTS
TO ACCOMPANY 1997 FORM 5500
ANNUAL REPORT OF EMPLOYEE BENEFIT PLAN
UNDER ERISA OF 1974
FOR THE YEAR ENDED DECEMBER 31, 1997
The supplemental schedules required to accompany the Plan's Form 5500
are not required since the Plan's assets are held in a Master Trust.
Accordingly, detailed financial information, including the supplemental
schedules, must be filed separately with the Department of Labor by the plan
administrator.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of
Raytheon Company:
We have audited the accompanying statements of net assets available
for plan benefits of the Raytheon Savings and Investment Plan (the "Plan") as of
December 31, 1997 and 1996, and the related statement of changes in net assets
available for plan benefits for the year ended December 31, 1997. These
financial statements are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the net assets available for plan benefits of
the Plan as of December 31, 1997 and 1996, and the changes in net assets
available for plan benefits for the year ended December 31, 1997 in conformity
with generally accepted accounting principles.
Coopers & Lybrand LLP
Boston, Massachusetts
May 29, 1998
2
RAYTHEON SAVINGS AND INVESTMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
as of December 31, 1997 and 1996
1997 1996
Assets:
Master trust investments:
At contract value (Notes B, E and H) $ 772,455,041 $ 772,729,672
At fair value (Notes B, F and H) 1,887,852,039 1,476,625,144
-------------- --------------
2,660,307,080 2,249,354,816
-------------- --------------
Receivables:
Accrued investment income
and other receivables 3,765,409 931,039
Cash and cash equivalents 18,482,006 21,398,335
-------------- --------------
Total assets 2,682,554,495 2,271,684,190
-------------- --------------
Liabilities:
Payable for outstanding purchases 3,213,981 1,488,542
Accrued expenses and other payables 1,766,653 954,240
-------------- --------------
Total liabilities 4,980,634 2,442,782
-------------- --------------
Net assets available for plan benefits $2,677,573,861 $2,269,241,408
============== ==============
The accompanying notes are an integral part of the financial statements.
3
RAYTHEON SAVINGS AND INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS
AVAILABLE FOR PLAN BENEFITS
for the year ended December 31, 1997
Additions to net assets attributable to:
Investment income (Notes B, E, and H):
Net appreciation of investments $ 266,296,571
Interest 60,810,967
Dividends 65,037,158
--------------
392,144,696
--------------
Contributions and deferrals:
Employee deferrals 139,052,540
Employer contributions 41,031,026
Transfers (Note G) 2,012,446
--------------
182,096,012
--------------
Total additions 574,240,708
--------------
Deductions from net assets attributable to:
Distributions to participants 165,263,589
Administrative expenses 644,666
Total deductions 165,908,255
--------------
Increase in net assets 408,332,453
Net assets available for plan benefits,
beginning of year 2,269,241,408
--------------
Net assets available for plan benefits,
end of year $2,677,573,861
==============
The accompanying notes are an integral part of the financial statements.
4
A. Description of Plan:
General
The following description of the Raytheon Savings and Investment Plan
(the "Plan") provides only general information. Participants should refer to the
plan document for a complete description of the Plan's provisions. The Plan is a
defined contribution plan covering certain employees of Raytheon Company (the
"Company"). To participate in the Plan, eligible employees must have three
months of service and may enter the Plan only on the first day of each month.
The purpose of the Plan is to provide participants with a tax-effective means of
meeting both short- and long-term investment objectives. The Plan is intended to
be a "qualified cash or deferred arrangement" under Sections 401(a) and 401(k)
of the Internal Revenue Code (the "Code"). The Plan is subject to the provisions
of the Employee Retirement Income Security Act of 1974 (ERISA).
The Plan's investments are held in the Raytheon Company Master Trust
for Defined Contribution Plans ("Master Trust") with the assets of other defined
contribution plans of the Company and subsidiaries. The trustee of the Master
Trust maintains a separate account reflecting the equitable share in the Trust
of each plan.
Investment income and administrative expenses relating to the Master
Trust are allocated to the individual plans based upon average monthly balances
invested by each plan.
Contributions and Deferrals
Eligible employees are allowed to defer to the Plan up to 17% of their
salaries. The Company contributes amounts equal to 50% of each participant's
deferral, up to a maximum of 3% of the participant's salary. As of December 31,
1997, the annual employee deferral for a participant cannot exceed $9,500.
Rollover contributions from other qualified plans are accepted by the Plan.
Participants may invest their deferrals in increments of 1% in any combination
of seven funds: (a) a Fixed Income Fund under which assets are invested
primarily in contracts providing for fixed rates of interest for specified
periods of time, (b) an Equity Fund which invests in shares of a mutual fund
which consists primarily of income-producing equity securities, (c) a Raytheon
Common Stock Fund which invests in shares of Raytheon Company Class B common
stock, (d) a Stock Index Fund which invests in a commingled pool consisting
primarily of equity securities and is designed to track the S&P 500 Index, (e) a
Balanced Fund which invests in shares of a mutual fund which consists primarily
of equity securities, bonds and money market instruments, (f) the Magellan Fund,
a growth fund which invests primarily in equities of companies of all types and
sizes, and (g) the Blue Chip Fund, a growth fund which invests primarily in
equities of well known and established companies. Dividends and distributions
from investments of the Raytheon Common Stock Fund, the Equity Fund, the Stock
Index Fund, the Balanced Fund, the Magellan Fund and the Blue Chip Fund are
reinvested in their respective funds; stock dividends, stock splits and similar
changes are also reflected in the funds.
5
Participant Accounts
Each participant's account is credited with the participant's
deferral, the Company's contribution and an allocation of plan earnings. Plan
earnings are allocated based on account balances by fund.
Vesting
Participants are immediately vested in their voluntary deferrals plus
actual earnings thereon. Vesting requirements for employer contributions plus
earnings thereon may vary depending upon when an employee became eligible to
participate in the Plan. Vesting generally occurs upon the earliest of the
completion of five years of service or three years of plan participation or upon
retirement, death, disability, or attainment of normal retirement age.
Forfeitures of the nonvested portions of terminated participants' accounts are
used to reduce required contributions of the Company.
Distributions to Participants
A participant may withdraw all or a portion of deferrals, employer
contributions and related earnings upon attainment of age 59 1/2. For reasons of
financial hardship, as defined in the Plan document, a participant may withdraw
all or a portion of deferrals. On termination of employment, a participant will
receive a lump-sum distribution unless the vested account is valued in excess of
$3,500 and the participant elects to defer distribution. A retiree or a
beneficiary of a deceased participant may defer the distribution until January
of the year following attainment of age 65.
Loans to Participants
A participant may borrow against a portion of the balance in the
participant's account, subject to certain restrictions. The maximum amount of a
loan is the lesser of one-half of the participant's vested account balance or
$50,000. The minimum loan which may be granted is $500. The interest rate
applied is equal to the prime rate published in the Wall Street Journal on the
first business day in June and December of each year. Loans must be repaid over
a period of up to 5 years by means of payroll deductions. In certain cases,
the repayment period may be extended up to 15 years. Interest paid to the Plan
on loans to participants is credited to the borrower's account in the investment
fund to which repayments are made.
Administrative Expenses
Substantially all expenses of administering the Plan are paid by the
plan participants.
B. Summary of Significant Accounting Policies:
The accompanying financial statements are prepared on the accrual
basis of accounting.
6
The Plan's investment contracts are fully benefit-responsive and are
therefore included in the financial statements at their contract value, defined
as net contributions and deferrals plus interest earned on the underlying
investments at contracted rates. Because the investment contracts are fully
benefit-responsive, contract values approximate fair value. Investments in
mutual funds and the commingled pool are valued at the closing net asset value
reported on the last business day of the year. Investments in securities (common
stocks) traded on a national securities exchange are valued at the last reported
sales price on the last business day of the year. Cash equivalents are
short-term money market instruments and are valued at cost which approximates
fair value.
Security transactions are recorded on trade date. Except for its
investment contracts (Note E), the Plan's investments are held by
bank-administered trust funds. Payables for outstanding security transactions
represent trades which have occurred but have not yet settled.
The Plan presents in the statement of changes in net assets the net
appreciation (depreciation) in the fair value of its investments which consists
of the realized gains or losses and the unrealized appreciation (depreciation)
on those investments.
Dividend income is recorded on the ex-dividend date. Income from other
investments is recorded as earned on an accrual basis.
Benefits are recorded when paid.
Certain items in the 1996 financial statements have been reclassified
to conform to the 1997 presentation.
The preparation of the financial statements in conformity with
generally accepted accounting principles requires the plan administrator to make
significant estimates and assumptions that affect the reported amounts of net
assets and liabilities available for benefits at the date of the financial
statements and the changes in net assets available for benefits during the
reporting period and, when applicable, disclosures of contingent assets and
liabilities at the date of the financial statements. Actual results could differ
from the estimates included in the financial statements.
The Plan provides for various investment options in any combination of
stocks, bonds, fixed income securities, mutual funds and other investment
securities. Investment securities are exposed to various risks, such as interest
rate, market and credit risk. Due to the level of risk associated with certain
investment securities and the level of uncertainty related to changes in the
value of investment securities, it is at least reasonably possible that changes
in risks in the near term would materially affect participants' account balances
and the amounts reported in the statement of net assets available for plan
benefits and the statement of changes in net assets available for plan benefits.
C. Federal Income Tax Status:
The Plan obtained its latest determination letter in July 1995, in
which the Internal Revenue Service stated that the Plan, as submitted, was in
compliance with the applicable requirements of the Internal Revenue Code. The
Plan has been amended since receiving the determination letter. However, the
Plan administrator and the Plan's legal counsel believe that the Plan is
currently designed and being operated in compliance with the applicable
requirements of the Internal Revenue Code. Therefore, no provision for income
taxes has been included in the Plan's financial statements.
7
D. Plan Termination:
Although it has not expressed any intention to do so, the Company
reserves the right under the Plan at any time or times to discontinue its
contributions and to terminate the Plan subject to the provisions of ERISA. In
the event of Plan termination, after payment of all expenses and proportional
adjustment of accounts to reflect such expenses, fund losses or profits and
reallocations, each participant shall be entitled to receive any amounts then
credited to his or her account.
E. Investment Contracts:
The Plan invests in collateralized fixed income investment portfolios
(with no expiration date), three of which are managed by insurance companies and
one of which is managed by an investment management firm. The credited interest
rates are adjusted semiannually to reflect the experienced and anticipated
yields to be earned on such investments, based on their book value. The
annualized average yield and credited interest rates were as follows:
Annualized
Average Credited
Yield Interest Rate
For year ended December 31, 1997:
Bankers Trust (WBS 92-485) 6.95% 6.95%
Metropolitan Life Insurance Company (GIC GA-12908) 6.86% 6.86%
Metropolitan Life Insurance Company (GIC GA-13659) 6.43% 6.43%
Prudential Asset Management Company (GIC 917163-001) 6.99% 6.99%
For the year ended December 31, 1996:
Bankers Trust (WBS 92-485) 6.87% 6.95%
Metropolitan Life Insurance Company (GIC GA-12908) 6.77% 6.86%
Metropolitan Life Insurance Company (GIC GA-13659) 6.36% 6.43%
Prudential Asset Management Company (GIC 917163-001) 6.89% 6.99%
The contract values are subject to limitations in certain situations
including large workforce reductions and plan termination.
In the financial statements, the two Metropolitan Life Insurance
Company contracts are recorded as one investment option.
F. Related Party Transactions:
In accordance with the provisions of the Plan, Fidelity Management
Trust Company (the "Trustee") acts as the Plan's agent for purchases and sales
of shares of Raytheon Company Class B common stock. These transactions are
performed on the Master Trust level. For the Master Trust, purchases amounted to
$200,689,057 and $158,515,882 and sales amounted to $102,165,608 and $38,523,792
for the years ended December 31, 1997 and 1996, respectively.
G. Transfers:
Transfers include transfers of participant accounts, individually
and/or in groups, between the Raytheon Savings and Investment Plan and all other
plans included in the Raytheon Company Master Trust for those participants
and/or groups of participants who changed plans during the year. Transfers also
include transfers of participant accounts, individually and/or in groups,
between the Raytheon Savings and Investment Plan and similar savings plans of
other companies for those participants who changed companies during the year.
8
H. Fund Data:
The following is a summary of net assets available for plan benefits
by fund as of December 31, 1997:
Raytheon
Fixed Common Stock Balanced Magellan
Income Fund Equity Fund Stock Fund Index Fund Fund Fund
Assets:
Master trust investments:
At contract value:
Bankers Trust* $288,500,627
Prudential Insurance
Company of America* 178,944,318
Metropolitan Life
Insurance Company* 305,010,096
At fair value:
Fidelity Equity
Income Fund* $702,811,931
Raytheon Company
Common Stock* $378,088,027
BT Pyramid Equity
Index Fund* $410,284,635
Fidelity Balanced Fund $99,624,204
Fidelity Magellan Fund $73,972,306
Fidelity Blue Chip Fund
Loans receivable from
participants
------------ ------------ ------------ ------------ ----------- -----------
Total investments 772,455,041 702,811,931 378,088,027 410,284,635 99,624,204 73,972,306
------------ ------------ ------------ ------------ ----------- -----------
Receivables:
Accrued investment income
and other receivables 2,782,739 982,670
Cash and cash equivalents 7,610,141 6,842,320 4,029,545
------------ ------------ ------------ ------------ ----------- -----------
Total assets 780,065,182 702,811,931 387,713,086 415,296,850 99,624,204 73,972,306
------------ ------------ ------------ ------------ ----------- -----------
Liabilities:
Payable for outstanding
purchases 3,213,981
Accrued expenses and
other payables 750,673 1,015,980
------------ ------------ ------------ ------------ ----------- -----------
Total liabilities 3,964,654 1,015,980
------------ ------------ ------------ ------------ ----------- -----------
Net assets available for
plan benefits $780,065,182 $702,811,931 $383,748,432 $414,280,870 $99,624,204 $73,972,306
============ ============ ============ ============ =========== ===========
*Represents more than 5% of net
assets available for plan benefits
9
Blue Chip
Fund Loan Fund Total
Assets:
Master trust investments:
At contract value:
Bankers Trust* $288,500,627
Prudential Insurance
Company of America* 178,944,318
Metropolitan Life
Insurance Company* 305,010,096
At fair value:
Fidelity Equity
Income Fund* 702,811,931
Raytheon Company
Common Stock* 378,088,027
BT Pyramid Equity
Index Fund* 410,284,635
Fidelity Balanced Fund 99,624,204
Fidelity Magellan Fund 73,972,306
Fidelity Blue Chip Fund $104,583,449 104,583,449
Loans receivable from
participants $118,487,487 118,487,487
------------ ------------ --------------
Total investments 104,583,449 118,487,487 2,660,307,080
------------ ------------ --------------
Receivables:
Accrued investment income
and other receivables 3,765,409
Cash and cash equivalents 18,482,006
------------ ------------ --------------
Total assets 104,583,449 118,487,487 2,682,554,495
------------ ------------ --------------
Liabilities:
Payable for outstanding
purchases 3,213,981
Accrued expenses and
other payables 1,766,653
------------ ------------ --------------
Total liabilities 4,980,634
------------ ------------ --------------
Net assets available for
plan benefits $104,583,449 $118,487,487 $2,677,573,861
============ ============ ==============
*Represents more than 5% of net
assets available for plan benefits
10
H. Fund Data, continued:
The following is a summary of net assets available for plan benefits
by fund as of December 31, 1996:
Raytheon
Fixed Common Stock Balanced Magellan
Income Fund Equity Fund Stock Fund Index Fund Fund Fund
Assets:
Master trust investments:
At contract value:
Bankers Trust* $291,452,605
Prudential Insurance
Company of America* 180,698,171
Metropolitan Life
Insurance Company* 300,578,896
At fair value:
Fidelity Equity
Income Fund* $528,486,753
Raytheon Company
Common Stock* $372,372,739
BT Pyramid Equity
Index Fund* $279,051,705
Fidelity Balanced Fund $76,235,541
Fidelity Magellan Fund $44,824,995
Fidelity Blue Chip Fund
Loans receivable from
participants*
------------ ------------ ------------ ------------ ----------- -----------
Total investments 772,729,672 528,486,753 372,372,739 279,051,705 76,235,541 44,824,995
------------ ------------ ------------ ------------ ----------- -----------
Receivables:
Accrued investment income
and other receivables 548,433 382,606
Cash and cash equivalents 12,555,817 5,629,300 3,213,218
------------ ------------ ------------ ------------ ----------- -----------
Total assets 785,285,489 528,486,753 378,550,472 282,647,529 76,235,541 44,824,995
------------ ------------ ------------ ------------ ----------- -----------
Liabilities:
Payable for outstanding purchases 1,488,542
Accrued expenses and other payables 520,203 434,037
------------ ------------ ------------ ------------ ----------- -----------
Total liabilities 2,008,745 434,037
------------ ------------ ------------ ------------ ----------- -----------
Net assets available for
plan benefits $785,285,489 $528,486,753 $376,541,727 $282,213,492 $76,235,541 $44,824,995
============ ============ ============ ============ =========== ===========
*Represents more than 5% of net assets
available for plan benefits
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Blue Chip
Fund Loan Fund Total
Assets:
Master trust investments:
At contract value:
Bankers Trust* $291,452,605
Prudential Insurance
Company of America* 180,698,171
Metropolitan Life
Insurance Company* 300,578,896
At fair value:
Fidelity Equity
Income Fund* 528,486,753
Raytheon Company
Common Stock* 372,372,739
BT Pyramid Equity
Index Fund* 279,051,705
Fidelity Balanced Fund 76,235,541
Fidelity Magellan Fund 44,824,995
Fidelity Blue Chip Fund $61,559,093 61,559,093
Loans receivable from
participants* $114,094,318 114,094,318
----------- ------------ --------------
Total investments 61,559,093 114,094,318 2,249,354,816
----------- ------------ --------------
Receivables:
Accrued investment income
and other receivables 931,039
Cash and cash equivalents 21,398,335
----------- ------------ --------------
Total assets 61,559,093 114,094,318 2,271,684,190
----------- ------------ --------------
Liabilities:
Payable for outstanding purchases 1,488,542
Accrued expenses and other payables 954,240
----------- ------------ --------------
Total liabilities 2,442,782
----------- ------------ --------------
Net assets available for
plan benefits $61,559,093 $114,094,318 $2,269,241,408
=========== ============ ==============
*Represents more than 5% of net assets
available for plan benefits
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H. Fund Data, continued:
The following is a summary of net assets available for plan benefits
by fund as of December 31, 1997:
Raytheon
Fixed Common Stock Balanced Magellan
Income Fund Equity Fund Stock Fund Index Fund Fund Fund
Additions to net assets
attributable to:
Investment income:
Net appreciation of investments $120,948,030 $20,461,839 $ 96,741,885 $ 6,060,528 $ 8,101,648
Interest $ 52,083,232 339,719 263,648
Dividends 38,332,138 5,635,976 11,796,445 4,345,938
------------ ------------ ----------- ------------ ----------- -----------
52,083,232 159,280,168 26,437,534 97,005,533 17,856,973 12,447,586
------------ ------------ ----------- ------------ ----------- -----------
Contributions and deferrals:
Employee deferrals 37,374,193 31,354,470 23,142,038 23,100,455 6,820,556 7,325,877
Employer contributions 11,021,000 9,475,138 6,973,904 6,738,271 2,031,306 2,141,751
Transfers 416,725 217,088 486,144 313,180 33,797 43,026
------------ ------------ ----------- ------------ ----------- -----------
48,811,918 41,046,696 30,602,086 30,151,906 8,885,659 9,510,654
------------ ------------ ----------- ------------ ----------- -----------
Total additions 100,895,150 200,326,864 57,039,620 127,157,439 26,742,632 21,958,240
------------ ------------ ----------- ------------ ----------- -----------
Deductions from net assets
attributable to:
Distributions to participants 78,215,945 33,061,517 19,458,406 18,864,751 5,234,076 2,700,029
Administrative expenses 218,539 168,459 106,090 95,457 23,552 13,897
------------ ------------ ----------- ------------ ----------- -----------
Total deductions 78,434,484 33,229,976 19,564,496 18,960,208 5,257,628 2,713,926
------------ ------------ ----------- ------------ ----------- -----------
Interfund transfers (27,680,973) 7,228,290 (30,268,419) 23,870,147 1,903,659 9,902,997
------------ ------------ ----------- ------------ ----------- -----------
Increase (decrease) in net assets (5,220,307) 174,325,178 7,206,705 132,067,378 23,388,663 29,147,311
Net assets available for plan
benefits, beginning of year 785,285,489 528,486,753 376,541,727 282,213,492 76,235,541 44,824,995
------------ ------------ ------------ ------------ ----------- -----------
Net assets available for plan
benefits, end of year $780,065,182 $702,811,931 $383,748,432 $414,280,870 $99,624,204 $73,972,306
============ ============ ============ ============ =========== ===========
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Blue Chip
Fund Loan Fund Total
Additions to net assets
attributable to:
Investment income:
Net appreciation of investments $ 13,982,641 $266,296,571
Interest $ 8,124,368 60,810,967
Dividends 4,926,661 65,037,158
----------- ------------ ------------
18,909,302 8,124,368 392,144,696
----------- ------------ ------------
Contributions and deferrals:
Employee deferrals 9,651,786 283,165 139,052,540
Employer contributions 2,649,656 41,031,026
Transfers 49,778 452,708 2,012,446
----------- ------------ ------------
12,351,220 735,873 182,096,012
----------- ------------ ------------
Total additions 31,260,522 8,860,241 574,240,708
----------- ------------ ------------
Deductions from net assets
attributable to:
Distributions to participants 3,102,399 4,626,466 165,263,589
Administrative expenses 18,672 644,666
----------- ------------ ------------
Total deductions 3,121,071 4,626,466 165,908,255
----------- ------------ ------------
Interfund transfers 14,884,905 159,394 --
----------- ------------ ------------
Increase (decrease) in net assets 43,024,356 4,393,169 408,332,453
Net assets available for plan
benefits, beginning of year 61,559,093 114,094,318 2,269,241,408
------------ ------------ --------------
Net assets available for plan
benefits, end of year $104,583,449 $118,487,487 $2,677,573,861
============ ============ ==============
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I. Master Trust:
All plan investments are included under the Master Trust. At December
31, 1997, assets of the Plan represented 76.2% of the total assets under the
Master Trust. This has decreased from 80.2% at December 31, 1996. The following
is a summary of net assets available for plan benefits by fund under the Master
Trust as of December 31, 1997:
Fixed Raytheon Stock
Income Equity Common Index Balanced Magellan Blue Chip
Fund Fund Stock Fund Fund Fund Fund Fund
Assets:
Investments:
At contract value:
Bankers Trust* $351,035,073
Prudential Insurance
Company of America* 217,731,699
Metropolitan Life
Insurance Company* 371,123,080
At fair value:
Fidelity Equity
Income Fund* $782,799,011
Raytheon Company
Common Stock* $745,980,294
BT Pyramid Equity
Index Fund* $484,781,406
Fidelity Balance Fund $117,556,481
Fidelity Magellan Fund $91,863,155
Fidelity Blue Chip Fund $136,586,123
Templeton Foreign I Fund
Fidelity Investment
Grade Bond Fund
Fidelity Retirement
Money Market Fund
Loans receivable from
participants
------------ ------------ ------------ ------------ ------------ ----------- ------------
Total investments 939,889,852 782,799,011 745,980,294 484,781,406 117,556,481 91,863,155 136,586,123
------------ ------------ ------------ ------------ ------------ ----------- ------------
Receivables:
Employer contribution
Accrued Investment income
and other receivables 5,489,592 1,161,112
Cash and cash equivalents 9,232,100 13,498,051 4,761,268
------------ ------------ ------------ ------------ ------------ ----------- ------------
Total assets 949,121,952 782,799,011 764,967,937 490,703,786 117,556,481 91,863,155 136,586,123
------------ ------------ ------------ ------------ ------------ ----------- ------------
Liabilities:
Payables for outstanding
purchases 6,340,318
Accrued expenses and
other payables 1,480,875 1,200,471
------------ ------------ ------------ ------------ ------------ ----------- ------------
Total liabilities 7,821,193 1,200,471
------------ ------------ ------------ ------------ ------------ ----------- ------------
Net assets available for
plan benefits $949,121,952 $782,799,011 $757,146,744 $489,503,315 $117,556,481 $91,863,155 $136,586,123
============ ============ ============ ============ ============ =========== ============
Percentage of Master Trust that 82.2% 89.8% 50.7% 84.6% 84.7% 80.5% 76.6%
are plan assets of the Raytheon
Savings and Investment Plan.
*Represents more than 5% of net assets available for plan benefits.
N/A: The Templeton Foreign I Fund, Investment Grade Bond Fund, and
Retirement Money Market Fund are not available for the Raytheon
Savings and Investment Plan.
15
Templeton Investment Retirement
Foreign I Grade Money Loan
Fund Bond Fund Market Fund Fund Total
Assets:
Investments:
At contract value:
Bankers Trust* $ 351,035,073
Prudential Insurance
Company of America* 217,731,699
Metropolitan Life
Insurance Company* 371,123,080
At fair value:
Fidelity Equity
Income Fund* 782,799,011
Raytheon Company
Common Stock* 745,980,294
BT Pyramid Equity
Index Fund* 484,781,406
Fidelity Balance Fund 117,556,481
Fidelity Magellan Fund 91,863,155
Fidelity Blue Chip Fund 136,586,123
Templeton Foreign I Fund $5,471,176 5,471,176
Fidelity Investment
grade Bond Fund $1,548,125 1,548,125
Fidelity Retirement
Money Market Fund $12,186,085 12,186,085
Loans receivable from
participants $166,395,767 166,395,767
---------- ---------- ----------- ------------ --------------
Total investments 5,471,176 1,548,125 12,186,085 166,395,767 3,485,057,475
---------- ---------- ----------- ------------ --------------
Receivables:
Employer contribution 4,015,100 4,015,100
Accrued investment income
and other receivables 6,650,704
Cash and cash equivalents 27,491,419
---------- ---------- ----------- ------------ --------------
Total assets 5,471,176 1,548,125 16,201,185 166,395,767 3,523,214,698
---------- ---------- ----------- ------------ --------------
Liabilities:
Payables for outstanding
purchases 6,340,318
Accrued expenses and
other payables 2,681,346
---------- ---------- ----------- ------------ --------------
Total liabilities 9,021,664
---------- ---------- ----------- ------------ --------------
Net assets available for
plan benefits $5,471,176 $1,548,125 $16,201,185 $166,395,767 $3,514,193,034
========== ========== =========== ============ ==============
Percentage of Master Trust that are N/A N/A N/A 71.2% 76.2%
plan assets of the Raytheon Savings
and Investment Plan
*Represents more than 5% of net assets available for plan benefits
N/A: The Templeton Foreign I Fund, Investment Grade Bond Fund, and
Retirement Money Market Fund are not available for the Raytheon
Savings and Investment Plan.
16
I. Master Trust, continued:
The following is a summary of net assets available for plan benefits
by fund under the Master Trust as of December 31, 1996:
Fixed Raytheon Stock
Income Equity Common Index Balanced Magellan
Fund Fund Stock Fund Fund Fund Fund
Assets:
Investments:
At contract value:
Bankers Trust* $339,670,440
Prudential Insurance
Company of America* 210,594,065
Metropolitan Life
Insurance Company* 350,310,646
At fair value:
Fidelity Equity
Income Fund * $578,166,630
Raytheon Company
Common Stock* $671,136,043
BT Pyramid Equity
Index Fund* $307,555,916
Fidelity Balance Fund $83,265,065
Fidelity Magellan Fund $50,454,961
Fidelity Blue Chip Fund
Loans receivable from
participants*
------------ ------------ ------------ ------------ ----------- -----------
Total investments 900,575,151 578,166,630 671,136,043 307,555,916 83,265,065 50,454,961
------------ ------------ ------------ ------------ ----------- -----------
Receivables:
Accrued investment income 39,737 13,686
Cash and cash equivalents 14,633,134 10,145,818 3,541,437
------------ ------------ ------------ ------------ ----------- -----------
Total assets 915,208,285 578,166,630 681,321,598 311,111,039 83,265,065 50,454,961
------------ ------------ ------------ ------------ ----------- -----------
Liabilities:
Payables for outstanding
purchases 2,682,835
------------ ------------ ------------ ------------ ----------- -----------
Total liabilities 2,682,835
------------ ------------ ------------ ------------ ----------- -----------
Net assets available for
plan benefits $915,208,285 $578,166,630 $678,638,763 $311,111,039 $83,265,065 $50,454,961
============ ============ ============ ============ =========== ===========
Percentage of Master Trust that are 85.8% 91.4% 55.5% 90.7% 91.6% 88.8%
plan assets of the Raytheon Savings
and Investment Plan.
*Represents more than 5% of net assets available for plan benefits.
17
Blue Chip Loan
Fund Fund Total
Assets:
Investments:
At contract value:
Bankers Trust* $339,670,440
Prudential Insurance
Company of America* 210,594,065
Metropolitan Life
Insurance Company* 350,310,646
At fair value:
Fidelity Equity
Income Fund * 578,166,630
Raytheon Company
Common Stock* 671,136,043
BT Pyramid Equity
Index Fund* 307,555,916
Fidelity Balance Fund 83,265,065
Fidelity Magellan Fund 50,454,961
Fidelity Blue Chip Fund $67,866,240 67,866,240
Loans receivable from
participants* $144,824,714 144,824,714
----------- ------------ --------------
Total investments 67,866,240 144,824,714 2,803,844,720
----------- ------------ --------------
Receivables:
Accrued investment income 53,423
Cash and cash equivalents 28,320,389
----------- ------------ --------------
Total assets 67,866,240 144,824,714 2,832,218,532
----------- ------------ --------------
Liabilities:
Payables for outstanding
purchases 2,682,835
----------- ------------ --------------
Total liabilities 2,682,835
----------- ------------ --------------
Net assets available for
plan benefits $67,866,240 $144,824,714 $2,829,535,697
=========== ============ ==============
Percentage of Master Trust that are 90.7% 78.8% 80.2%
plan assets of the Raytheon Savings
and Investment Plan
*Represents more than 5% of net assets available for plan benefits
18
I. Master Trust, continued:
The following is a summary of investment income by fund under the
Master Trust for the year ended December 31, 1997:
Fixed Raytheon
Income Common Stock Balanced Magellan Blue Chip
Fund Equity Fund Stock Fund Index Fund Fund Fund Fund
Investment income:
Net appreciation (depreciation)
of assets $ (191,924) $132,974,182 $30,715,963 $109,162,707 $ 6,388,316 $ 9,026,047 $15,474,118
Interest 62,319,073 673,934 312,511
Dividends 42,443,971 11,118,152 13,680,351 5,217,835 6,302,875
----------- ------------ ----------- ------------ ----------- ----------- -----------
Total investment income/(loss) $62,127,149 $175,418,153 $42,508,049 $109,475,218 $20,068,667 $14,243,882 $21,776,993
=========== ============ =========== ============ =========== =========== ===========
19
Templeton Investment Retirement
Foreign I Grade Money Loan
Fund Bond Fund Market Fund Fund Total
Investment income:
Net appreciation (depreciation)
of assets $(826,396) $22,581 $302,745,594
Interest $10,848,204 74,153,722
Dividends 549,717 36,337 $266,835 79,616,073
--------- ------- ------- ----------- ------------
Total investment income/(loss) $(276,679) $58,918 $266,835 $10,848,204 $456,515,389
========= ======= ======== =========== ============