1
EXHIBIT 99.6
RAYTHEON TI SYSTEMS SAVINGS PLAN
FINANCIAL STATEMENTS
TO ACCOMPANY 1998 FORM 5500
ANNUAL REPORT OF EMPLOYEE BENEFIT PLAN
UNDER ERISA OF 1974
FOR THE YEAR ENDED DECEMBER 31, 1998
The supplemental schedules to the Plan's Form 5500 are not required since the
Plan's assets are held in a Master Trust. Accordingly, the Plan administrator
must file detailed financial information, including the supplemental schedules,
separately with the Department of Labor.
2
REPORT OF INDEPENDENT ACCOUNTANTS
To the Participants and Administrator of
the Raytheon TI Systems Savings Plan:
In our opinion, the accompanying statements of net assets available for plan
benefits and the related statement of changes in net assets available for plan
benefits present fairly, in all material respects, the net assets available for
benefits of the Raytheon TI Systems Savings Plan (the "Plan") at December 31,
1998 and 1997, and the changes in net assets available for benefits for the year
ended December 31, 1998 in conformity with generally accepted accounting
principles. 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 of these statements in
accordance with generally accepted auditing standards which 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, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for the opinion expressed
above.
As discussed in Notes A and H to the financial statements, the Board of
Directors of Raytheon Company voted on December 16, 1998, to merge the Plan into
the Raytheon Savings and Investment Plan.
PricewaterhouseCoopers LLP
Boston, Massachusetts
June 4, 1999
3
RAYTHEON TI SYSTEMS SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
as of December 31, 1998 and 1997
1998 1997
Assets:
Master trust investments:
At contract value (Notes B, E and I) $ 36,008,015 $ 27,129,250
At fair value (Notes B, F and I) 215,389,507 151,647,372
------------ ------------
251,397,522 178,776,622
------------ ------------
Receivables:
Accrued investment income and
other receivables 422,047 528,072
Cash and cash equivalents 4,278,946 1,673,631
------------ ------------
Total assets 256,098,515 180,978,325
------------ ------------
Liabilities:
Payable for outstanding purchases 132,047 533,996
Accrued expenses and other payables 179,030 192,678
Transfer payables (Note H) 255,787,438
------------ ------------
Total liabilities 256,098,515 726,674
------------ ------------
Net assets available for plan benefits $ - $180,251,651
============ ============
The accompanying notes are an integral part of the financial statements.
4
RAYTHEON TI SYSTEMS SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS
AVAILABLE FOR PLAN BENEFITS
for the year ended December 31, 1998
Additions to net assets attributable to:
Investment income (Notes B, E and I):
Net appreciation of investments $ 25,229,092
Interest & Dividends 8,294,811
------------
33,523,903
Contributions and deferrals:
Employee deferrals 43,369,679
Employer contributions 8,443,415
Transfers (Note G) 32,797
------------
51,845,891
Total additions 85,369,794
------------
Deductions from net assets attributable to:
Distributions to participants 9,757,925
Administrative expenses 16,103
Transfers (Note G and H) 255,847,417
------------
Total deductions 265,621,445
------------
Decrease in net assets (180,251,651)
Net assets, beginning of year 180,251,651
------------
Net assets, end of year $ -
============
The accompanying notes are an integral part of the financial statements.
5
RAYTHEON TI SYSTEMS SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
A. Description of Plan:
General
As more fully described in Note H, the Raytheon TI Systems Savings Plan (the
"Plan") ceased to exist as of December 31, 1998 and effective January 1, 1999,
was merged into the Raytheon Savings and Investment Plan (RAYSIP). The following
description of the Plan provides only general information that is applicable
through December 31, 1998. Participants should refer to the plan document for a
complete description of the Plan's provisions.
The Plan was established on July 11, 1997 for former employees of Texas
Instruments. The Plan is a defined contribution plan covering certain employees
of Raytheon Company (the "Company"). An employee becomes eligible to participate
in the Plan on the date he or she becomes an employee and may enter the Plan any
day thereafter during his or her employment. 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 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 combined with the investments of other similar
defined contribution plans of the Company into the Raytheon Company Master Trust
for Defined Contribution Plans ("Master Trust"). 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 2% of the participant's salary. For 1998, the annual employee
deferral for a participant cannot exceed $10,000. Rollover contributions from
other qualified plans are accepted by the Plan. Participants may invest their
deferrals in any combination of nine 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) the Fidelity Equity Income Fund which invests
in shares of a mutual fund consisting primarily of income-producing equity
securities, (c) a Raytheon Common Stock Fund which invests in shares of Raytheon
Company 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) the Fidelity Balanced Fund which invests
6
in shares of a mutual fund consisting primarily of equity securities, bonds and
money market instruments, (f) the Fidelity Magellan Fund, a growth fund which
invests primarily in equities of companies of all types and sizes, (g) the
Fidelity Blue Chip Fund, a growth fund which invests primarily in equities of
well known and established companies, (h) the Templeton Foreign I Fund, a
long-term capital growth fund which invests in stocks and debt obligations of
companies and governments of any nation and (i) the Fidelity Investment Grade
Bond Fund which invests primarily in U.S. government and corporate bonds
including, without limitation, index funds and mutual funds. The Fidelity
Investment Grade Bond Fund was eliminated as an option during 1998 and balances
were transferred into the Fixed Income Fund. Dividends and distributions from
investments of the Fidelity Equity Income Fund, the Raytheon Common Stock Fund,
the Stock Index Fund, the Fidelity Balanced Fund, the Fidelity Magellan Fund,
the Fidelity Blue Chip Fund, the Templeton Foreign I Fund and the Fidelity
Investment Grade Bond Fund are reinvested in their respective funds; stock
dividends, stock splits and similar changes are also reflected in the funds.
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 fully and immediately vested in their entire account balance
including voluntary deferrals, employer contributions and all investment
earnings thereon.
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 five
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.
7
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.
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. Contract value approximates 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. Participant loans are valued at cost, which approximates fair value.
Security transactions are recorded on the 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. Investment income
includes both dividends and interest income.
Benefits are recorded when paid.
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.
8
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 Internal Revenue Service has determined and informed the Company by letter
dated March 1999 that the Plan, as adopted on July 11, 1997, and related trust
are designed in accordance with applicable sections of the Code. The Plan has
been amended since applying for 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 Code. Therefore, no provision for income taxes has been included in the
Plan's financial statements.
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, plan assets shall be distributed among all participants in
proportion to their interest and employee contributions shall be distributed in
accordance with the provisions contained in the Code.
E. Investment Contracts:
The Plan invests in collateralized fixed income investment portfolios which are
managed by insurance companies and investment management firms. 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:
9
Annualized Credited
Average Yield Interest Rate
For the year ended December 31, 1998:
Banker's Trust (WBS 92-485) 6.85% 6.85%
Metropolitan Life Insurance
Company (GIC GA-12908) 6.58% 6.58%
Metropolitan Life Insurance
Company (GIC GA-13659) 6.10% 6.10%
Prudential Asset Management
Company (GIC 917163-001) 6.75% 6.75%
Connecticut General (GIC 0025174) 5.58% 5.58%
Fidelity IPL (633-GCDC) 5.62% 5.62%
Monumental Life Insurance
Company (GIC BDA00463FR-00) 7.84% 7.84%
For the year ended December 31, 1997:
Banker's 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%
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:
The Plan's trustee is Fidelity Management Trust Company (the "Trustee"). The
Trustee holds the funds for the Plan and is responsible for managing the Plan's
investment assets, executing all investment transactions, recording approved
transactions, and, therefore these transactions qualify as party-in-interest.
In accordance with the provisions of the Plan, the Trustee acts as the Plan's
agent for purchases and sales of shares of Raytheon Company common stock. These
transactions are performed on a Master Trust level. For the Master Trust,
purchases amounted to $288,116,995 and sales amounted to $257,878,566 for the
year ended December 31, 1998.
G. Transfers:
Transfers include transfers of participant accounts, individually and/or
in-groups, between the Plan and 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 Plan and similar savings plans of
other companies for those participants who changed companies during the year.
H. Transfer Payables:
As part of an overall effort to minimize plan design differences and increase
administrative efficiencies, the Board of Directors of Raytheon Company voted on
December 16, 1998 to merge the participants and their account balances into the
RAYSIP. The Plan ceased to exist on December 31, 1998 and effective January 1,
1999, the plan provisions of the RAYSIP govern. The transfer payable amount
represents a complete transfer of assets to the RAYSIP.
10
I. Fund Data:
The following is a summary of net assets available for plan benefits by
fund as of December 31, 1998:
Fixed Raytheon Stock
Income Equity Common Index Balanced Magellan Blue Chip
Fund Fund Stock Fund Fund Fund Fund Fund
Assets:
Master trust investments:
At contract value:
Bankers Trust $ 12,676,508
Prudential Life Insurance
Company of America 6,347,889
Metropolitan Life
Insurance Company 15,933,322
Fidelity 691,160
Connecticut General 175,137
Monumental Life
Insurance Company 183,999
At fair value:
Fidelity Equity
Income Fund $ 17,276,885
Raytheon Company
Common Stock Fund $54,644,741
BT Pyramid Equity
Index Fund $46,192,796
Fidelity Balanced
Fund $13,627,478
Fidelity Magellan
Fund $19,552,160
Chip Fund $41,109,867
Templeton Foreign I
Fund
Loans receivable
from participants
------------ ----------- ----------- ----------- ----------- ----------- -----------
Total investments 36,008,015 17,276,885 54,644,741 46,192,796 13,627,478 19,552,160 41,109,867
------------ ----------- ----------- ----------- ----------- ----------- -----------
Receivables:
Accrued investment income
and other receivables 324,556 97,491
Cash and cash equivalents 3,320,586 752,045 206,315
------------ ----------- ----------- ----------- ----------- ----------- -----------
Total assets 39,328,601 17,276,885 55,721,342 46,496,602 13,627,478 19,552,160 41,109,867
------------ ----------- ----------- ----------- ----------- ----------- -----------
Liabilities:
Payable for outstanding
purchases 132,047
Accrued expenses and other
payables 126,681 52,349
Transfer payables 39,328,601 17,276,885 55,462,614 46,444,253 13,627,478 19,552,160 41,109,867
------------ ----------- ----------- ----------- ----------- ----------- -----------
Total liabilities 39,328,601 17,276,885 55,721,342 46,496,602 13,627,478 19,552,160 41,109,867
------------ ----------- ----------- ----------- ----------- ----------- -----------
Net assets available for
plan benefits $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
============ =========== =========== ========== =========== =========== ===========
11
Templeton
Foreign I Loan
Account Fund Total
Assets:
Master trust investments:
At contract value:
Bankers Trust $ 12,676,508
Prudential Insurance
Company of America 6,347,889
Metropolitan Life
Insurance Company 15,933,322
Fidelity 691,160
Connecticut General 175,137
Monumental Life
Insurance Company 183,999
At fair value:
Fidelity Equity
Income Fund 17,276,885
Raytheon Company
Common Stock Fund 54,644,741
BT Pyramid Equity
Index Fund 46,192,796
Fidelity Balanced
Fund 13,627,478
Fidelity Magellan
Fund 19,552,160
Fidelity Blue
Chip Fund 41,109,867
Templeton Foreign I
Fund $ 6,966,650 6,966,650
Loans receivable
from participants $16,018,930 16,018,930
----------- ----------- ------------
Total investments 6,966,650 16,018,930 251,397,522
----------- ----------- ------------
Receivables:
Accrued investment income
and other receivables 422,047
Cash and cash equivalents 4,278,946
----------- ----------- ------------
Total assets 6,966,650 16,018,930 256,098,515
----------- ----------- ------------
Liabilities:
Payable for outstanding
purchases 132,047
Accrued expenses and
other payables 179,030
Transfer payables 6,966,650 16,018,930 255,787,438
----------- ----------- ------------
Total liabilities 6,966,650 16,018,930 256,098,515
----------- ----------- ------------
Net assets available for
plan benefits $ 0 $ 0 $ 0
=========== =========== ============
12
I. Fund Data, Continued:
The following is a summary of net assets available for plan benefits by
fund as of December 31, 1997:
Raytheon
Fixed Equity Common Stock Balanced Magellan
Income Fund Fund Stock Fund Index Fund Fund Fund
Assets:
Master trust investments:
At contract value:
Bankers Trust* $ 10,132,377
Prudential Insurance
Company of America 6,284,670
Metropolitan Life
Insurance Company* 10,712,203
At fair value:
Fidelity Equity Income Fund $ 8,254,100
Raytheon Company Common Stock* $62,818,459
BT Pyramid Equity Index Fund* $27,442,258
Fidelity Balanced Fund $7,638,642
Fidelity Magellan Fund $6,635,153
Fidelity Blue Chip Fund*
Templeton Foreign I Fund
Fidelity Investment Grade
Bond Fund
Loans receivable from participants*
------------ ----------- ----------- ----------- ---------- ----------
Total investments 27,129,250 8,254,100 62,818,459 27,442,258 7,638,642 6,635,153
------------ ----------- ----------- ----------- ---------- ----------
Receivables:
Accrued investment income
and other receivables 462,345 65,727
Cash and cash equivalents 267,275 1,136,836 269,520
------------ ----------- ----------- ----------- ---------- ----------
Total assets 27,396,525 8,254,100 64,417,640 27,777,505 7,638,642 6,635,153
------------ ----------- ----------- ----------- ---------- ----------
Liabilities:
Payable for outstanding
purchases 533,996
Accrued expenses and other
payables 124,723 67,955
------------ ----------- ----------- ---------- ----------- ----------
Total liabilities - - 658,719 67,955 - -
------------ ----------- ----------- ---------- ----------- ----------
Net assets available for plan
benefits $ 27,396,525 $ 8,254,100 $63,758,921 $27,709,550 $7,638,642 $6,635,153
============ =========== =========== =========== ========== ==========
*Represents more than 5% of net assets available for plan benefits
13
Templeton Investment
Blue Chip Foreign I Grade Loan
Fund Fund Bond Fund Fund Total
Assets:
Investments:
At contract value:
Bankers Trust* $ 10,132,377
Prudential Life Insurance
Company of America 6,284,670
Metropolitan Life
Insurance Company* 10,712,203
At fair value:
Fidelity Equity
Income Fund 8,254,100
Raytheon Company Common
Stock Fund* 62,818,459
BT Pyramid Equity Index
Fund* 27,442,258
Fidelity Balanced Fund 7,638,642
Fidelity Magellan Fund 6,635,153
Fidelity Blue Chip
Fund* $ 18,760,639 18,760,639
Templeton Foreign I
Fund $5,471,176 5,471,176
Fidelity Investment
Grade Bond Fund $1,548,125 1,548,125
Loans receivable from
participants* $ 13,078,820 13,078,820
------------ ---------- ---------- ------------ ------------
Total investments 18,760,639 5,471,176 1,548,125 13,078,820 178,776,622
------------ ---------- ---------- ------------ ------------
Receivables:
Accrued investment income
and other receivables 528,072
Cash and cash equivalents 1,673,631
------------ ---------- ---------- ------------ ------------
Total assets 18,760,639 5,471,176 1,548,125 13,078,820 180,978,325
------------ ---------- ---------- ------------ ------------
Liabilities:
Payable for outstanding
purchases 533,996
Accrued expenses and
other payables 192,678
------------ ---------- ---------- ------------ ------------
Total liabilities - - - - 726,674
------------ ---------- ---------- ------------ ------------
Net assets available for
plan benefits $ 18,760,639 $5,471,176 $1,548,125 $ 13,078,820 $180,251,651
============ ========== ========== ============ ============
*Represent more than 5% of net assets available for plan benefits
14
I. Fund Data, Continued:
The following is a summary of changes in net assets available for plan
benefits by fund for the year ended December 31, 1998:
Fixed Raytheon Stock
Income Equity Common Index Balanced Magellan Blue Chip
Fund Fund Stock Fund Fund Fund Fund Fund
Additions to net assets
attributable to:
Investment income:
Net appreciation
(depreciation) of
investments $ 3,295 $ 584,690 $ 5,158,554 $ 9,280,287 $ 829,007 $ 3,117,037 $ 7,334,555
Interest & Dividends 1,993,246 874,982 1,116,139 717,602 1,421,709
----------- ------------ ----------- ----------- ----------- ------------ ------------
1,996,541 1,459,672 5,158,554 9,280,287 1,945,146 3,834,639 8,756,264
----------- ------------ ----------- ----------- ----------- ------------ ------------
Contributions and deferrals:
Employee deferrals 6,104,144 5,975,544 3,061,022 7,954,043 2,632,497 5,181,263 8,707,144
Employer contributions 1,130,391 1,217,093 659,688 1,608,662 479,166 944,884 1,701,689
Transfers 14,206 42,771 3,898 (12,411) (1,814) (1,765)
------------ ------------ ----------- ----------- ----------- ------------ ------------
7,248,741 7,235,408 3,724,608 9,550,294 3,111,663 6,124,333 10,407,068
------------ ------------ ----------- ----------- ----------- ------------ ------------
Total additions 9,245,282 8,695,080 8,883,162 18,830,581 5,056,809 9,958,972 19,163,332
------------ ------------ ----------- ----------- ----------- ------------ ------------
Deductions from net assets
attributable to:
Distributions to
participants 1,860,825 745,470 1,703,163 1,536,525 675,276 535,393 1,528,144
Administrative expenses 2,492 940 5,698 2,756 767 764 1,998
Transfers (13,295) 27,074 62,761
Transfers plan mergers 39,328,602 17,276,885 55,462,614 46,444,253 13,627,478 19,552,160 41,109,867
------------ ------------ ----------- ------------ ----------- ------------ ------------
Total deductions 41,191,919 18,010,000 57,198,549 48,046,295 14,303,521 20,088,317 42,640,009
------------ ------------ ----------- ------------ ----------- ------------ ------------
Interfund transfers 4,550,112 1,060,820 (15,443,534) 1,506,164 1,608,070 3,494,192 4,716,038
------------ ------------ ----------- ------------ ----------- ------------ ------------
Decrease in net assets (27,396,525) (8,254,100) (63,758,921) (27,709,550) (7,638,642) (6,635,153) (18,760,639)
Net assets, beginning
of year 27,396,525 8,254,100 63,758,921 27,709,550 7,638,642 6,635,153 18,760,639
------------ ------------ ----------- ----------- ------------ ------------ ------------
Net assets, end of year $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
============ ============ =========== =========== ============ ============ ============
15
Templeton Investment
Foreign I Grade Bond Loan
Fund Fund Fund Total
Additions to net assets
attributable to:
Investment income:
Net appreciation
(depreciation) of
investments $(1,095,967) $ 17,634 $ 25,229,092
Interest & Dividends 752,610 162,858 $ 1,255,665 8,294,811
----------- ------------ ------------ -------------
(343,357) 180,492 1,255,665 33,523,903
----------- ------------ ------------- -------------
Contributions and deferrals:
Employee deferrals 2,897,062 856,960 43,369,679
Employer contributions 598,350 103,492 8,443,415
Transfers (12,088) 32,797
---------- ------------ ------------- -------------
3,495,412 960,452 (12,088) 51,845,891
----------- ------------ ------------- -------------
Total additions 3,152,055 1,140,944 1,243,577 85,369,794
----------- ------------ ------------- -------------
Deductions from net assets
attributable to:
Distributions to
participants 274,069 123,832 775,228 9,757,925
Administrative expenses 514 174 16,103
Transfers (16,562) 59,978
Transfers plan mergers 6,966,650 16,018,930 255,787,439
----------- ------------ -------------- -------------
Total deductions 7,241,233 124,006 16,777,596 265,621,445
----------- ------------ -------------- -------------
Interfund transfers (1,381,998) (2,565,063) 2,455,199
----------- ----------- -------------- -------------
Decrease in net assets (5,471,176) (1,548,125) (13,078,820) (180,251,651)
----------- ----------- -------------- -------------
Net assets, beginning
of year 5,471,176 1,548,125 13,078,820 180,251,651
------------ ----------- -------------- -------------
Net assets, end of year $ 0 $ 0 $ 0 $ 0
============ =========== ============= =============
16
J. Master Trust:
All plan investments are included under the Master Trust. At December 31,
1998, assets of the Plan represented 0% of the total assets under the
Master Trust. This has decreased from 5.1% at December 31, 1997.
The following is a summary of net assets available for plan benefits by
fund under the Master Trust as of December 31, 1998:
Fixed Raytheon Stock
Income Equity Common Index Balanced Magellan
Fund Fund Stock Fund Fund Fund Fund
Assets:
Investments:
At contract value:
Bankers Trust* $ 473,258,791
Prudential Life Insurance
Company of America 236,989,116
Metropolitan Life
Insurance Company* 594,847,154
Fidelity 25,803,449
Connecticut General 6,538,482
Monumental Life Insurance
Company 6,869,338
At fair value:
Fidelity Equity Income
Fund* $1,464,615,296
Raytheon Company Common
Stock Fund* $ 799,542,751
BT Pyramid Equity
Index Fund* $ 745,602,791
Fidelity Balanced Fund* $ 442,796,289
Fidelity Magellan Fund* $ 379,680,454
Fidelity Blue Chip Fund*
Templeton Foreign I Fund
Fidelity Investment Grade
Bond Fund
Fidelity Retirement
Money Market
Vanguard Winsor
Vanguard Wellesley
TRP Small Cap Stock
Raytheon Class A Wasting
Stock Fund
Raytheon GMH Wasting
Stock Fund
Loans receivable from
participants
-------------- -------------- -------------- -------------- -------------- --------------
Total investments 1,344,306,330 1,464,615,296 799,542,751 745,602,791 442,796,289 379,680,454
-------------- -------------- -------------- -------------- -------------- --------------
Receivables:
Employer contribution
Accrued investment income
and other receivables 4,748,948 1,573,604
Transfer receivables 580,261,670 762,142,416 440,085,027 216,741,687 312,377,329 236,688,803
Cash and cash equivalents 123,969,201 11,004,025 3,330,147
-------------- -------------- -------------- -------------- -------------- --------------
Total assets 2,048,537,201 2,226,757,712 1,255,380,751 967,248,229 755,173,618 616,369,257
-------------- -------------- -------------- -------------- -------------- --------------
Liabilities:
Payable for outstanding
purchases 1,932,125
Accrued expenses and
other payables 1,853,618 844,977
Transfer payables 580,261,670 762,142,416 440,085,027 216,741,687 312,377,329 236,688,803
-------------- -------------- -------------- -------------- -------------- --------------
Total liabilities 580,261,670 762,142,416 443,870,770 217,586,664 312,377,329 236,688,803
-------------- -------------- -------------- -------------- -------------- --------------
Net assets available for
plan benefits $1,468,275,531 $1,464,615,296 $ 811,509,981 $ 749,661,565 $ 442,796,289 $ 379,680,454
============== ============== ============== ============== ============== ==============
17
Templeton Investment Retirement Vanguard Vanguard
Blue Chip Foreign I Grade Money Winsor Wellesley
Fund Fund Bond Fund Market Fund Fund Fund
Assets:
Investments:
At contract value:
Bankers Trust*
Prudential Life Insurance
Company of America
Metropolitan Life
Insurance Company*
Fidelity
Connecticut General
Monumental Life Insurance
Company
At fair value:
Fidelity Equity Income
Fund*
Raytheon Company Common
Stock Fund*
BT Pyramid Equity
Index Fund*
Fidelity Balanced Fund*
Fidelity Magellan Fund*
Fidelity Blue Chip Fund* $ 391,787,509
Templeton Foreign I Fund $ 6,966,704
Fidelity Investment Grade
Bond Fund $ -
Fidelity Retirement
Money Market $ 13,202,524
Vanguard Winsor $ 41
Vanguard Wellesley $ 18
TRP Small Cap Stock
Raytheon Class A Wasting
Stock Fund
Raytheon GMH Wasting
Stock Fund
Loans receivable from
participants
-------------- -------------- -------------- ------------- ------------- --------------
Total investments 391,787,509 6,966,704 - 13,202,524 41 18
-------------- -------------- -------------- ------------- ------------- --------------
Receivables:
Employer contribution 3,595,261
Accrued investment income
and other receivables
Transfer receivables 191,269,141 6,966,652 16,715,590
Cash and cash equivalents
-------------- -------------- -------------- ------------- ------------- --------------
Total assets 583,056,650 13,933,356 - 33,513,375 41 18
-------------- -------------- -------------- ------------- ------------- --------------
Liabilities:
Payable for outstanding
purchases
Accrued expenses and
other payables
Transfer payables 191,269,141 6,966,652 16,715,590
-------------- -------------- -------------- ------------- ------------- --------------
Total liabilities 191,269,141 6,966,652 - 16,715,590 - -
-------------- -------------- -------------- ------------- ------------- --------------
Net assets available for
plan benefits $ 391,787,509 $ 6,966,704 $ - $ 16,797,785 $ 41 $ 18
============== ============== ============== ============== ============== ==============
18
TRP Small RTN.A GMH
Cap Stock Wasting Wasting Loan
Fund Fund Fund Fund Other(1) Total
Assets:
Investments:
At contract value:
Bankers Trust* $ 473,258,791
Prudential Life Insurance
Company of America 236,989,116
Metropolitan Life
Insurance Company* 594,847,154
Fidelity 25,803,449
Connecticut General 6,538,482
Monumental Life Insurance
Company 6,869,338
At fair value:
Fidelity Equity Income
Fund* 1,464,615,296
Raytheon Company Common
Stock Fund* 799,542,751
BT Pyramid Equity
Index Fund* 745,602,791
Fidelity Balanced Fund* 442,796,289
Fidelity Magellan Fund* 379,680,454
Fidelity Blue Chip Fund* 391,787,509
Templeton Foreign I Fund 6,966,704
Fidelity Investment Grade
Bond Fund -
Fidelity Retirement
Money Market 13,202,524
Vanguard Winsor 41
Vanguard Wellesley 18
TRP Small Cap Stock $ 348 348
Raytheon Class A Wasting
Stock Fund $ 116,129,149 116,129,149
Raytheon GMH Wasting
Stock Fund $ 172,859,819 172,859,819
Loans receivable from
participants $ 250,687,865 250,687,865
-------------- -------------- -------------- -------------- ------------- --------------
Total investments 348 116,129,149 172,859,819 250,687,865 - 6,128,177,888
-------------- -------------- -------------- -------------- ------------- --------------
Receivables:
Employer contribution 3,595,261
Accrued investment income
and other receivables 1,193,397 23,640 7,539,589
Transfer receivables 120,761,325 178,295,618 117,046,618 $ 855,826,675 4,035,178,551
Cash and cash equivalents 3,480,490 5,474,220 147,258,083
-------------- -------------- -------------- ------------- -------------- --------------
Total assets 348 241,564,361 356,653,297 367,734,483 855,826,675 10,321,749,372
-------------- -------------- -------------- ------------- -------------- --------------
Liabilities:
Payable for outstanding
purchases 1,932,125
Accrued expenses and
other payables 41,711 62,061 2,802,367
Transfer payables 120,761,325 178,295,618 117,046,618 3,179,351,876
-------------- -------------- -------------- ------------- -------------- --------------
Total liabilities - 120,803,036 178,357,679 117,046,618 - 3,184,086,368
-------------- -------------- -------------- ------------- -------------- --------------
Net assets available for
plan benefits $ 348 $120,761,325 $ 178,295,618 $ 250,687,865 $ 855,826,675 $7,137,663,004
============== ============== ============== ============== ============== ==============
Percentage of Master Trust that are Plan assets - 0.00%
*Represent more than 5% of net assets available for plan benefits
(1) Other represents Raytheon plans merging in from outside the Master Trust.
Note: Not all funds within the Master Trust are available options to
participants in the Plan.
19
J. 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, 1997:
Fixed Raytheon Stock
Income Equity Common Index Balanced Magellan
Fund Fund Stock Fund Fund Fund Fund
Assets:
Investments:
At contract value:
Bankers Trust* $351,035,073
Prudential Life 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 Fund* $745,980,294
BT Pyramid Equity Index
Fund* $484,781,406
Fidelity Balanced Fund $117,556,481
Fidelity Magellan Fund $91,863,155
Fidelity Blue Chip
Fund
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
------------ ------------ ------------ ------------ ------------ -----------
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
------------ ------------ ------------ ------------ ------------ -----------
Liabilities:
Payable 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
============ ============ ============ ============ ============ ===========
20
Templeton Investment Retirement
Blue Chip Foreign I Grade Money Loan
Fund Fund Bond Fund Market Fund Fund Total
Assets:
Investments:
At contract value:
Bankers Trust* $351,035,073
Prudential Life 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 Fund* 745,980,294
BT Pyramid Equity Index
Fund* 484,781,406
Fidelity Balanced Fund 117,556,481
Fidelity Magellan Fund 91,863,155
Fidelity Blue Chip
Fund $136,586,123 136,586,123
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 136,586,123 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 136,586,123 5,471,176 1,548,125 16,201,185 166,395,767 3,523,214,698
Liabilities:
Payable 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 $136,586,123 $5,471,176 $1,548,125 $16,201,185 $166,395,767 $3,514,193,034
============ ========== ========== =========== ============ ==============
Percentage of Master Trust that are Plan assets - 5.1%
*Represent more than 5% of net assets available for plan benefits
Note: Not all funds within the Master Trust are available options to
participants in the Plan.
21
J. Master Trust, Continued:
The following is a summary of investment income by fund under the Master Trust
for the year ended December 31, 1998:
Fixed Raytheon Stock
Income Equity Common Index Balanced Magellan
Fund Fund Stock Fund Fund Fund Fund
Investment income:
Net appreciation
(depreciation) of assets $ 30,695 $ 49,019,748 $74,202,083 $149,571,006 $16,091,158 $62,195,801
Interest & Dividends 81,886,632 86,279,682 1,792 42,537,357 13,255,763
----------- ------------ ----------- ------------ ----------- -----------
Total investment
income/(loss) $81,917,327 $135,299,430 $74,203,875 $149,571,006 $58,628,515 $75,451,564
=========== ============ =========== ============ =========== ===========
22
Templeton Investment Retirement Vanguard Vanguard
Blue Chip Foreign I Grade Money Winsor Wellesley
Fund Fund Bond Fund Market Fund Fund Fund
Investment income:
Net appreciation
(depreciation) of assets $60,264,181 $(1,095,980) $ 17,635 $2,864,378 $1,379,950
Interest & Dividends 13,550,491 752,610 162,858 $ 349,740
----------- ----------- -------- ---------- ---------- ----------
Total investment
income/(loss) $73,814,672 $ (343,370) $180,493 $ 349,740 $2,864,378 $1,379,950
=========== =========== ======== ========== ========== ==========
23
TRP Small RTN.A GMH
Cap Stock Wasting Wasting Loan
Fund Fund Fund Fund Total
Investment income:
Net appreciation
(depreciation) of assets $ 15 $ (35,268) $44,604,025 $459,109,427
Interest & Dividends $15,334,403 254,111,328
----------- ---------- ----------- ----------- ------------
Total investment
income/(loss) $ 15 $ (35,268) $44,604,025 $15,334,403 $713,220,755
=========== ========== =========== =========== ============