complaint1

14 April 2002

It was only when Boeing released the Proxy statement to the SEC on March 22 that I found out they had significantly " edited ' my proposal, and had not only ignored my final input in accordance with the SEC required or allowed changes, but had repeated the same misleading short description on the proxy statement as last year. So I immediately notified Boeing, Perkins-Coie, and the SEC and filed a formal complaint via e-mail. The SEC does not reveal what they do or suggest to the Company when a complaint is made. Also be aware that all communications with the Company and with the SEC are available in the SEC reading room in Wash D.C.- and to date they have not made arrangements to put them on line.

What follows :

1) My proposal as submitted. [interim 'charges and rebuttals omitted in this sequence- but available on my site ]
2) SEC response - allowing Boeing to omit certain phrases and asking me to ' support " others e.g CalPERS. -apparently quote marks are not adequate.
3) My appeal and proposal changed exactly as the SEC requested.
4) The Boeing version - as published.
5) Slightly redacted e-mails of my complaint.

Submitted Proposal [ 486 words ]- NOTE - ITALICS ADDED TO WORDS AND PHRASES DELETED/MODIFIED RE SEC LETTER OF FEB 14TH. Of course links that show here would not show in my proposal - with the exception of the CalPERS link I wanted to include.

Resolved: Shareholders request the Board of Directors adopt the following policy:

(1) All employees vested at time of conversion be given a choice between their heritage plans or the Pension Value cash-balance plan at time of termination or retirement.

(2) The cash balance plan to provide a monthly annuity at least equal to that expected under the old pension plan, or an actuarially equivalent lump sum.

Supporting Statements

Boeing implemented the Pension Value Plan [PVP] in 1999 for over 100,000 non-represented employees Although the PVP is primarily one of benefit formula change, Boeing improperly claimed it could not comply with eligibility, vesting, benefit and funding requirements by giving employees a choice at retirement or termination. Over 50 Congresspersons signed a letter to the IRS suggesting several changes in regulations including " . . . a safe harbor should be established allowing cash balance plans to meet existing legal requirements only if all employees are allowed to choose which pension plan works best for them . . ."

[Representative B. Sanders, February 24,2000]

Last year, this proposal received 52 million votes despite being incorrectly described on the proxy card as a retiree choice. The California Public Employees Retirement System supported it and stated 'CalPERS advocates non-discrimination in retirement " We believe a majority of employee shareholders supported our proposal. Boeing ignored and declined multiple requests for the summary voting record of State Street which held 69 million employee shares as a trustee.

We believe Boeing has periodically understated the vested benefits due employees during the last decade, which could make the new plan appear better as the rate at which employees earn future benefits can be more or less than the rate under the old plan(s). Boeing will not provide a copy of their analysis described last year.
Boeing does not use excess plan investment gains to increase the benefits otherwise due any participant, but uses them to reduce or eliminate future Company contributions, and to pump up earnings with non-spendable dollars. Last year, the amount used was 428 Million, about 20 percent of net earnings.

In 1994, over 1,000 McDonnell Douglas Corp. workers alleged that the company closed their plant in Tulsa to avoid paying pension and retiree medical benefits. On September 5 2001, Judge Holmes found for the retirees, while noting the company had "engaged in a course of obstruction, inconsistent representations and outright falsehoods." From paragraph 232 "The record further reflects a corporate culture of mendacity . . . and the disregard for the truth evidenced by the testimony of [ the then ] CEO.

[James R Milsap, et.al v McDonnell Douglas Corp. Case No 94-C-633-H , and the WSJ September 6 2001]

Communications and background on this and my previous proposal are available at
http://home.att.net/~dprops/welcome.html

Please encourage the BOD to keep their previous pension promises by giving an informed choice to loyal employees who made the company famous and profitable.
THANK YOU

======END OF PROPOSAL AS SUBMITTED ===

Here is the SEC response that told Boeing to publish and allowed them to remove certain words.

. . . We are unable to concur with your view that Boeing can exclude the entire proposal and supporting statement under 14a-8(i)(3). However, there appears to be some basis for your view that portions of the supporting statement may be materially false or misleading under rule 14a-9. In our view, the proponent must:

delete the word "improperly" from the statement that begins "Boeing improperly claimed.. ." and ends " or termination";

delete the words "ignored and " from the statement that begins "Boeing ignored . . as trustee "

delete the sentence that begins "We believe . . " and ends ' . . under the old plan(s)";

delete the phrase "and to pump up earnings with non-spendable dollars" from the sentence that begins "Boeing does not ' and ends " with non-spendable dollars ";

delete the discussion that begins " In 19944 ." and ends" . . September 6 2001]";

revise the sentence that begins" The California Public . . . ."and ends in . . retirement"' to provide factual support In the form of a citation to a specific source;

delete the sentence that begins " Please encourage and end . . . to loyal employees"; and
delete the sentence that begins " Communications" and ends " . . . http://home.att.net/~dprops/welcome.html "

Accordingly, unless the proponent provides Boeing with a proposal and supporting statement revised In this manner, within seven calendar days after receiving this letter, we will not recommend enforcement action to the Commission if Boeing omits only these portions of the proposal and supporting statement from its proxy materials in reliance on rule 14a-8(i)(3)
Sincerely,
Maryse Mills-Apenteng
Attorney-Advisor

So like a good proponent- I changed my proposal exactly as requested - provided factual support re CalPERS, and sent it to Boeing. I also appealed to the SEC since some things did not seem to follow their own rules. Note that I specifically requested that in the appropriate places a [ removed . . .] statement be included to avoid even further confusion. Boeing ignored and did their own editing

REDACTED IN ACCORDANCE WITH SEC FEB 14TH LETTER PENDING APPEAL
[ 391words ] [Phrase deleted ]portions are intended to be printed as shown

Resolved: Shareholders request the Board of Directors adopt the following policy:
(1) All employees vested at time of conversion be given a choice between their heritage plans or the Pension Value cash-balance plan at time of termination or retirement.

(2) The cash balance plan to provide a monthly annuity at least equal to that expected under the old pension plan, or an actuarially equivalent lump sum.

Last year, this proposal received 52 million votes despite being incorrectly described on the proxy card as a retiree choice. The California Public Employees Retirement System supported it. From: CorpGov@calpers.ca.gov To:[proponent]
Subject: Boeing Proposal Date: Wed, 21 Mar 2001 09:39:51 -0800
X-WSS-ID: 16A6368A238361-01-01
Preliminary research indicates that this proposal warrants our support. We commend your efforts and look forward to reviewing the proxy material when released.
From April 2001 until Jan 2002, their website at
http://www.calpers-governance.org/alert/proxy/proxy-results.asp

stated: " BOEING CO Ticker: BA Shareholder Meeting Date: 4/30/01
Total Shares Voted:4,691,243 Number Description / Reason Vote
7. Shareholder Proposal : Give Certain Retirees a Choice Between Old Pension Plan and New Cash Balance Plan For CalPERS advocates non-discrimination in retirement."

We believe a majority of employee shareholders supported our proposal. Boeing declined multiple requests for the summary voting record of State Street which held 69 million employee shares as a trustee.

[Phrase deleted ] Boeing will not provide a copy of their analysis described last year.

Boeing does not use excess plan investment gains to increase the benefits otherwise due any participant, but uses them to reduce or eliminate future Company contributions.
[ Phrase deleted ] Last year, the amount used was 428 Million, about 20 percent of net earnings.

[ Phrase deleted ] who made the company famous and profitable
THANK YOU

=====

Now compare the above with what Boeing did print in the proxy. I've hilited and annotated some areas- BTW the " retiree choice " on the proxy card was the same as last year - despite the wording in my proposal .Boeing did fight my comments on this issue this year and I had thought they lost. since SEC did not ask/direct me to remove it.

13. Give retirees choice of pension plans.

===

ITEM 13 SHAREHOLDER PROPOSAL ON PENSION PLANS

. . . Shareholder Resolution

RESOLVED: Shareholders request the Board of Directors adopt the following policy:

(1)
All employees vested at time of conversion be given a choice between their heritage plans or
the Pension Value cash-balance plan at time of termination or retirement.
(2)
The cash balance plan to provide a monthly annuity at least equal to that expected under the
old pension plan, or an actuarially equivalent lump sum.

Proponent's Supporting Statement

Boeing implemented the Pension Value Plan [PVP] in 1999 for over 100,000 non-represented
employees. Although the PVP is primarily one of benefit formula change, Boeing claimed it could
not comply with eligibility, vesting, benefit and funding requirements by giving employees a choice
at retirement or termination. Over 50 Congresspersons signed a letter to the IRS suggesting
several changes in regulations including" a safe harbor should be established allowing cash
balance plans to meet existing legal requirements only if all employees are allowed to choose which
pension plan works best for them. " [Representative B. Sanders, February 24, 2000]

Last year, this proposal received 52 million votes despite being incorrectly described on the proxy
card as a retiree choice. The California Public Employees Retirement System supported it.

[ NOTE MAJOR DELETION OF MY SUPPORT FOR MY QUOTED STATEMENT RE CALPERS]

We believe a majority of employee shareholders supported our proposal. Boeing declined multiple
requests for the summary voting record of State Street which held 69 million employee shares as
a trustee.

Boeing will not provide a copy of their analysis described last year.

Boeing does not use excess plan investment gains to increase the benefits otherwise due any
participant, but uses them to reduce or eliminate future Company contributions. Last year, the
amount used was 428 Million, about 20 percent of net earnings.

[NOTE- BY NOT INCLUDING THE PHRASE DELETED AS REQUESTED - THE STATEMENT NOW READS/INFERS THAT BA CONTRIBUTED 428 MILLION TO THE PENSIONB PLAN. THAT IS MATERIALLY FALSE AND MISLEADING. THE 428 MILLION WAS SHOWN IN THE EARNINGS FOR 2000.

NOTE THEY TOTALLY DELETED MY CLOSING - INCLUDING THE THANK YOU !

BTW - THE E-MAIL ADDRESS TO USE RE SUCH MATTERS IS cfletters@sec.gov

FOLLOWING ARE RELATED E-MAILS - SLIGHTLY REDACTED FOR PRIVACY.

Sent on March 18

To: *SEC Corp Finance
From: Donald Shuper <dshuper@att.net>
Subject: RE Boeing Shareholder proposal
Cc: BA Corp Secretary, SueMPerkinsCoie
Bcc:
X-Attachments:

ATTN Martin Dunn and Maryse Mills Apenteng

Today - I received in the mail the SEC response - but NO mention of my appeal faxed to Boeing and the SEC on FEB 15th
My fax log shows my appeal was faxed to sec division of Corp finance 1-202-942-9525 at 13.38 my time on Feb 15,2002.

Boeing and perkins Coei were also included- and both confirmed receipt of my appeal

Further - last week I called and left a message at 202 -942- 2900 - and never received a response

Copied and pasted into this e-mail is my appeal

I request immediate confirmation of receipt of this e-mail and consideration of my appeal

Thank you - Donald Shuper xxxxx

Securities and Exchange Commission Fri,Feb 15th,2002
Office of Chief Counsel Division of Corporation Finance Judiciary Plaza 450 Fifth Street, N.W.
Washington, D.C. 20549 FAX -1-202-942-9525
Re: Boeing Shareholder Proposal by Don Shuper for Annual Meeting April 2002.
Re: Boeing letter of 07 February 2002, request for no-action letter from Perkins-Coie LLP on behalf of The Boeing Company. ["Boeing 2nd request" ]

Subject: Appeal of portions of SEC letter of 14 Feb 2002
We would appreciate confirmation of receipt of this letter by reply to dshuper@att.net or by PHONE OR FAX to XXXXXX We have faxed copies to Perkins Coie and Boeing
Dear Sir or Madam:
We wish to appeal portions of the SEC letter regarding certain required deletions. Meanwhile, to speed up the process and avoid further delays, we are enclosing a copy of our redacted proposal in strict accordance with your requests, pending a resolution of our appeal.

1) . . .delete the sentence that begins " Communications" and ends
" . http://home.att.net/~dprops/welcome.html "

Comment : We can find no supportable or documented claims by Boeing that meet the standards described in Staff bulletin # 14 in section F-1, which states 'Companies seeking to exclude a website address under rule 14a-8(i)(3) should specifically indicate why they believe information contained on the particular website is materially false or misleading, irrelevant to the subject matter of the proposal or otherwise in contravention of the proxy rules. "
The burden of proof is on Boeing, they have made no supportable claims, merely allegations.

2) . . "delete the sentence that begins " Please encourage and end . . . to loyal employees";

Comment : We have enclosed copies of the SEC response from last year, along with our proposal as published, and as initially submitted last year. We complied exactly with the SEC request, and believe your current response was caused by confusion resulting from Boeings' lack of proving their allegations, and our response which did not adequately resolve the issue of the "informed " wording. We did remove the "informed" wording from the Resolution statement as requested. Boeing made no further objections to the use of the word in our supporting statement in the last paragraph.

Thank you for your attention

Donald W Shuper ---

====

Use of the word 'informed"

In our initial submittal last year, our opening statement in our proposal was:
Resolved : The shareholders request that the Boeing Board of Directors adopt the following policy:
(1) All non-represented employees be given an informed choice between the old Boeing Heritage pension plans used prior to Jan 1, 1999, or the current Pension Value cash-balance plan at time of termination or retirement.

Boeing objected to the informed wording , and in the SEC response, the requirement said:

. . In our view, the proponent must:
- delete the word "informed" in the sentence that begins "All no-represented . . ." and ends "...or retirement "

Nothing was said about our use of the word promise or informed in our closing statement which said then and now:

Please encourage the BOD to keep their previous pension promises by giving an informed choice to the loyal employees who have helped make the company famous and profitable.

Thus we appeal your current decisions on the two issues -

1) use of our website URL
2) deletion of the last phrase, which was also mis-stated in your response, since the sentence does not end as indicated

Additionally, we have included our proposal, redacted as requested, and added what we believe is adequate- traceable support for our CalPERS statement.

attachments

a) Our current proposal - redacted in conformance with your initial request - pending our appeal.
b) Last years SEC request for our 2001 annual meeting proposal
c) Our 2001 proposal as published last year - specific areas marked

Our phone/fax number is XXXXXX - Yesterday- at noon our time we placed a call to the SEC 292-942- 2900 - requesting clarification. At the time we are faxing this - we have not received a response.

Thank you for your attention

Donald W Shuper

REDACTED IN ACCORDANCE WITH SEC FEB 14TH LETTER PENDING APPEAL
[ 391words ] [Phrase deleted ]portions are intended to be printed as shown

(2) The cash balance plan to provide a monthly annuity at least equal to that expected under the old pension plan, or an actuarially equivalent lump sum.

Supporting Statements
Boeing implemented the Pension Value Plan [PVP] in 1999 for over 100,000 non-represented employees Although the PVP is primarily one of benefit formula change, Boeing claimed it could not comply with eligibility, vesting, benefit and funding requirements by giving employees a choice at retirement or termination. Over 50 Congresspersons signed a letter to the IRS suggesting several changes in regulations including " . . . a safe harbor should be established allowing cash balance plans to meet existing legal requirements only if all employees are allowed to choose which pension plan works best for them . . ." [Representative B. Sanders, February 24,2000]
Last year, this proposal received 52 million votes despite being incorrectly described on the proxy card as a retiree choice. The California Public Employees Retirement System supported it. From: CorpGov@calpers.ca.gov To:[proponent]
Subject: Boeing Proposal Date: Wed, 21 Mar 2001 09:39:51 -0800
X-WSS-ID: 16A6368A238361-01-01
Preliminary research indicates that this proposal warrants our support. We commend your efforts and look forward to reviewing the proxy material when released.
From April 2001 until Jan 2002, their website at
http://www.calpers-governance.org/alert/proxy/proxy-results.asp
stated: " BOEING CO Ticker: BA Shareholder Meeting Date: 4/30/01
Total Shares Voted:4,691,243 Number Description / Reason Vote
7. Shareholder Proposal : Give Certain Retirees a Choice Between Old Pension Plan and New Cash Balance Plan For CalPERS advocates non-discrimination in retirement."

[Phrase deleted ] Boeing will not provide a copy of their analysis described last year.

Boeing does not use excess plan investment gains to increase the benefits otherwise due any participant, but uses them to reduce or eliminate future Company contributions.
[ Phrase deleted ] Last year, the amount used was 428 Million, about 20 percent of net earnings.

[ Phrase deleted ] who made the company famous and profitable
THANK YOU

===== END OF RESUBMITTAL OF APPEAL OF FEB 15TH

To: BA Corp Secretary, SueMPerkinsCoie
From: Donald Shuper <dshuper@att.net>
Subject: Confirmation of SEC call today RE Boeing Shareholder proposal
Cc: *SEC Corp Finance

RE Boeing Shareholder proposal e-mail

In response to my e-mail his afternoon- I received a call from the SEC

They agreed to look at my appeal - they could find no trace of my Faxc of the 15th.

I read to them the Boeing statement about filing on the 22nd, and that I had received an updated copy of the BOD statement in Objection. the only difference noted was my proposal is now number 13 instead of 12.

I re-restated verbally my basis for appeal - and verbally added that the exclusion of the ' pumped up earnings statement" actually resulted in misleading information,

- - - Boeing does not use excess plan investment gains to increase the benefits otherwise due any participant, but uses them to reduce or eliminate future Company contributions.
[ Phrase deleted ] Last year, the amount used was 428 Million, about 20 percent of net earnings. ---

in that it now looks like Boeing applied the 428 Million as a company contribution - and not to earnings.

I also explained my concerns about my web-site address in that Boeing provided no support as to the unacceptability of my site URL - as described in the SEC staff letter.

I suggested that further communications be by e-mail - alternate FAX - and verified my Fax number as X X X X X

About a half hour later- I left a phone message for Ms Morgan.

I Stand ready to work with everyone to bring final resolution by the 22nd of March should changes be appropriate, and suggest that e-mail communications be used to document whatever is needed

Don Shuper

To: *SEC Corp Finance again on 3/18/02
From: Donald Shuper <dshuper@att.net>
Subject: BOEING SHAREHOLDER PROPOSAL APPEAL
Cc: BA Corp Secretary, SueMPerkinsCoie

ATTN Martin Dunn and Maryse Mills Apenteng

===

I note that in the SEC No- action letter of Feb 13th, you authorized publication of my proposal with certain words and phrases redacted.

Specifially, Boeing had complained about the use of the word " pump - up " as submitted. there statement follows in thier rebuttal to my offer of adding the word legally..

"1. Proponent stated in paragraph 5 of his original Proposal that the Company "uses excess plan investment gains. . . to pump-up earnings with non-spendable dollars. " The Company in its no-action request letter argued that this allegation "is properly excludable because it impugns the Company's integrity by falsely and misleadingly implying that the Company is using improper accounting procedures to falsify its earnings." In his rebuttal letter, Proponent suggests that the false and misleading nature of this allegation can be remedied by adding the word "legally" before the words "pump up." This attempted "fix" does not work, because the statement still accuses the Company of pumping up earnings, and by use of that pejorative phrase, implies that the Company has acted improperly. Accordingly, the entire statement should be excluded from the Proposal.

My comment was as follows

"Comment: Some of our dictionary definitions of "pump up" include; to increase, heighten, or strengthen. We can find no definition that appears to be objectively pejorative. [ Webster Encyclopedic Unabridged Dictionary, 2001 Edition ]. For example, possible substitutions could include inflate, increase, heighten, strengthen. We believe it would be easier to resolve by a simple phone call than to pick any alternate wording and get further embroiled in the passing of notes with multiple copies game across the country as a result of the untimely response by Boeing.

The SEC response was :

Delete the phrase "and to pump up earnings with non-spendable dollars" from the sentence that begins "Boeing does not . . ' and ends .... . with non-spendable dollars";

As I've mentioned, deletion of that phrase does change the meaning.

Perhaps this recent sub-headline from the Wall Street Journal may put the use of the words ' pump up ' in a different light - partial extract included here. Apparently the WSJ also does not consider it pejorative.

March 15, 2002
HEARD ON THE STREET

IBM's Overfunded Pension Plan Won't Pump Up the Bottom Line

By WILLIAM M. BULKELEY
Staff Reporter of THE WALL STREET JOURNAL

The pension profit bonanza is diminishing at International Business Machines.

For years, Big Blue has been chalking up big profits from its overfunded pension plan, which, as critics have noted, has little to do with how well the company is doing in its main business of selling technology.

But in 2002, IBM has cut its actuarial rate of return -- a critical fact in determining how much it books from pension gains -- to 9.5% from 10%. That, say several sharp-eyed observers, means pension income is destined to decline this year for the first time since pensions became an income item instead of a cost item for IBM in 1996.
IBM's 2001 Earnings Were Stronger Than Early Report Said, Filings Show1
03/12/02 "

End extract

I might note that Boeing uses a 9.25% expected return on plan assets for the year 2000 - page 89-annual report.

Thank you for your reconsideration

To: *SEC Corp Finance
From: Donald Shuper <dshuper@att.net>
Subject: Formal complaint against Boeing re proxy
Cc: BA Corp Secretary, SueMPerkinsCoie Bcc:

RE Boeing shareholder proposal number 13

I've just found the 2002 proxy as filed. I wish to formally complain the Boeing has edited my proposal neither in conformance with the SEC requests , or my redacted proposal which was done in exact conformance with the SEC letter of Feb 13th. As a result, one of the statements is specifically and objectively materially false and misleading.

I note that Boeing made absolutely NO effort to communicate or resolve any wording issues, and has NOT acted in good faith throughout this process.

As filed the statement reads

"Boeing does not use excess plan investment gains to increase the benefits otherwise due any participant, but uses them to reduce or eliminate future Company contributions<bold>. Last year, the amount used was 428 Million, about 20 percent of net earnings. "

This statement now means that 428 Million was used to reduce company contributions this is in direct contradiction to the facts as stated in the 2000 Annual report/ That 428 Million was included in EARNINGS and not used as part of a company contribution.

Additionally, .in accordance with SEC instructions, I provided an EXACT documented reference to the CalPERS statement.

My original proposal stated

"The California Public Employees Retirement System supported last year's proposal and stated, 'CalPERS advocates non discrimination in retirement.

Boeing objected - and when I provided the site reference then complained that the site had changed. The SEC then requested

" revise the sentence that begins that begins"TheCa1ifomiaPublic. .."and ends' .in

retirement"' to provide factual support In the form of a citation to a specific source;

My redacted proposal in conformance with the SEC request then stated

The California Public Employees Retirement System supported it. From: CorpGov@calpers.ca.gov To:[proponent]

Subject: Boeing Proposal Date: Wed, 21 Mar 2001 09:39:51 -0800 X-WSS-ID: 16A6368A238361-01-01

Preliminary research indicates that this proposal warrants our support. We commend your efforts and look forward to reviewing the proxy material when released. From April 2001 until Jan 2002, their website at

http://www.calpers-governance.org/alert/proxy/proxy-results.asp

stated: " BOEING CO Ticker: BA Shareholder Meeting Date: 4/30/01

Total Shares Voted:4,691,243 Number Description / Reason Vote

7. Shareholder Proposal : Give Certain Retirees a Choice Between Old Pension Plan and New Cash Balance Plan For CalPERS advocates non-discrimination in retirement."

Boeing not only ignored my revised proposal but made their own version of modifications by stating

. . . The California Public Employees Retirement System supported it."

Additionally- Boeing refused to note where sections had been deleted by SEC request , and deleted the final statement in its entirety - even though it was identical to the statement used in the previous year.

Please encourage the BOD to keep their previous pension promises by giving an informed choice to the loyal employees who have helped make the company famous and profitable THANK YOU.

Nor did they redact it in accordance with the SEC request.

Don Shuper - - - -

So there it is - looks like Boeing not only played word games with my proposal , but a few others.

SEC rules suggest that any false and misleading statement be reported to the SEC

====

HERE IS AN UPDATE AS OF 24 APRIL - TWO E-MAILS ONE TO BOEING TEH OTHER TO CALPERS

== APRIL 23. 2002

To: *SEC Corp Finance, BA Corp Secretary, SueMPerkinsCoie
From: Donald Shuper <dshuper@att.net>
Subject: Boeing Annual meeting - proposal number 13

Referance - My shareholder proposal :

13. Give retirees choice of pension plans.

As you know, I have submitted a formal complaint to the SEC on the improper editing of my proposal, which has resulted in a materially false and misleading statement about the use of pension fund ' surplus ".

. . . reduce or eliminate future Company contributions. Last year, the amount used was 428 Million, about 20 percent of net earnings."

That amount was not contributed to the pension plans, but was included in the earnings figures

Additionally, even though my proposal clearly states "Last year, this proposal received 52 million votes despite being incorrectly described on the proxy card as a retiree choice.",Boeing has again this year used the same incorrect and misleading statement on the proxy card.

I ask that when my proposal is announced , Boeing make a suitable statement as to both errors.

I also ask that when each proposal is announced, the approximate- unaudited and incomplete voting percentages be included.

Thank you for your attention

Donald W Shuper

====APRIL 22 2002 NOTE TO CALPERS

To: CorpGov@calpers.ca.gov
From: Donald Shuper <dshuper@att.net>
Subject: Boeing Shareholder proposal # 13

Dear Sir or Madam

Subject Boeing Annual meeting proxy - proposal number 13 .

I am somewhat surprised that you have changed from supporting my proposal last year, to voting against the same proposal this year

Last year , my proposal was number 7 and you stated :
'CalPERS advocates non-discrimination in retirement "

This year, you now state, in virtually a copy of the company position
13. Shareholder Proposal Offer choice between heritage plans and the 1999 Pension Value Plan at time of termination or retirement
Against
CalPERS believes implementation of the proposal may result in large costs and significant administrative difficulties

I'd like to quote from a Boeing statement made by the Boeing Chief actuary on the subject, and include the full text following, and ask to you reconsider your vote

Thank you Donald W Shuper
==
[OCR COPY - NUMBERS CHECKED TO ORIGINAL ]
February 6, 2001
Mr. Donald Shuper
From Julie Curtis
Director of Actuarial Services

. . . You also expressed concern that Boeing might not have complied with the SEC Chief Accountant's Audit
Risk Alert dated December 22, 1999. In reviewing the Alert (which is quite lengthy), I am guessing that
you are concerned that Boeing might have failed to disclose a risk or extraordinary event created by a
change in pension plans. The Alert specifically addresses employee pension plan changes that "could be
expected to have a material impact on the results of operations and cash flows of those companies." As
explained below, such an event did not occur at Boeing.

On January 1,1999, Boeing did establish a cash balance plan for a large portion of its salaried employees.
However, the change in plan provisions did not significantly change the benefits already earned, the
amount of benefits to be earned in the future, the existing obligation, expected future obligations, or
funded status. The change was primarily one of benefit formula in order to bring the
employees of the three heritage companies under a single plan. The change was disclosed
in Financial Footnote 14, on page 67 of the 1998 Annual Report, and the increase in the
pension obligation was explicitly quantified at $420 million.

Management evaluated whether the change was significant enough to discuss in the MD&A, but decided that the $420 million increase out of a total pension liability of $28,887 million did not constitute a significant change in financial position.

===
Below is the complete OCR copy
===
[OCR COPY - NUMBERS CHECKED TO ORIGINAL ]
February 6, 2001
Mr. Donald Shuper
xxxx
Dear Mr. Shuper:

Your e-mail regarding The Boeing Company's pension income, which was addressed to Jim Dagnon and
dated January 17, 2001, has been forwarded to me for response.

In your e-mail, you requested a history of the Company's pension income and how it has been reflected in
the Company's financial results. You also expressed concern that Boeing has used the pension income to
inflate earnings and has not provided complete, accessible disclosure of the income. In addition, you cite
several sources which indicate that Boeing has reflected substantial pension income in its books to make
profit margins and earnings look more favorable than they otherwise would have.

I would like to address each of your concerns individually. To start, since 1997, Boeing's pension income,
earnings before income tax, and net income are as follows (dollars are in millions):
1997
1998
1999
Pension income/(expense) $(65)
$121
$125
Earnings(losses) before income tax and interest expense (256)
1,567
3,170
Net income (losses) (178)
1,120
2,309

All of the above figures come from the 1999 Boeing Annual Report. The pension income appears on page
65. The two earnings items appear on page 51. The 2000 results are not yet available but will appear in
the 2000 Annual Report and in the 10-K, which we expect to file in early March.

The above figures show that your second concern, the potential for Boeing to inflate its financial results
by using pension income, has not occurred. Before 1998, Boeing reflected pension expense rather than
income. In 1998 and 1999, pension income represented 10.8% and 5.4% of net income and 7.7% and 3.9%
of operating earnings.

The Company fully discloses the development of its pension income (expense) and the funded status of
the pension plans in the financial footnotes. As you mentioned, the I development of the pension-related
financial figures is governed by Financial Accounting Standard No. 87 (FAS87). Companies have only
limited discretion in the development of these figures. The underlying methods and assumptions are
closely monitored by the SEC and carefully audited by public accounting firms (in Boeing's case, Deloitte &
Touche). Boeing discloses its assumptions in the footnote so that the investment community can
compare Boeing's assumptions to those used by other companies. Historically, Boeing's methods and
assumptions tend to be slightly conservative, but always well within the guidelines established by the SEC.

In addition, the Company is aware that many informed investors and analysts carefully scrutinize the
underlying detail disclosed in the benefits footnote. Discrepancies, anomalies, omissions, or aggressive
assumptions would be noticed immediately.

Each year, Boeing examines the effect that pension income and its companion expense, the FAS 106
retiree medical and life insurance expense, have on operating earnings and net earnings. In the event that
these items have a significant effect on earnings, or if an extraordinary event occurs, pensions and
other post-retirement benefits will be included in Management's Discussion and Analysis (MD&A).

Boeing is aware that the sustained bull market during the past decade has resulted in
significant investment returns in the pension plans' trust funds. Not all of these gains
have been recognized yet in the FAS87 pension income. Because FAS87 requires that
these gains be recognized in an orderly fashion, Boeing anticipates that FAS87 pension
income will increase substantially over the next few years. The size of these unrecognized
gains and their expected effect on future pension income is discussed in 1999 Annual
Report's MD&A on page 33. Although the 2000 pension income has not yet been disclosed,
Boeing has indicated to investment analysts that the figure will be several hundred million
dollars greater than the $125 million income in 1999.

You also expressed concern that Boeing might not have complied with the SEC Chief Accountant's Audit
Risk Alert dated December 22, 1999. In reviewing the Alert (which is quite lengthy), I am guessing that
you are concerned that Boeing might have failed to disclose a risk or extraordinary event created by a
change in pension plans. The Alert specifically addresses employee pension plan changes that "could be
expected to have a material impact on the results of operations and cash flows of those companies." As
explained below, such an event did not occur at Boeing.

On January 1,1999, Boeing did establish a cash balance plan for a large portion of its salaried employees.
However, the change in plan provisions did not significantly change the benefits already earned, the
amount of benefits to be earned in the future, the existing obligation, expected future obligations, or
funded status. The change was primarily one of benefit formula in order to bring the
employees of the three heritage companies under a single plan. The change was disclosed
in Financial Footnote 14, on page 67 of the 1998 Annual Report, and the increase in the
pension obligation was explicitly quantified at $420 million.

Management evaluated whether the change was significant enough to discuss in the MD&A, but decided
that the $420 million increase out of a total pension liability of $28,887 million did not constitute a
significant change in financial position.

Your final concern relates to several publications that conflict with the above facts. These articles imply
that Boeing has indeed experienced substantial pension income, distorting the Company's financial
statements. As you mentioned in your e-mail, a Wall Street Journal article that appeared on September
20, 1999, cited a Bear Stearns study that had calculated Boeing's 1998 pension income to be 31% of
total income. The Journal misquoted the Bear Stearns study; the true number was 7.7%. As for the quote
from the July 2000 Aviation Week article, Boeing's 1999 pension income was $125 million. I do not know
how the reporter arrived at a $500 million figure.

I hope that the above information addresses your concerns. I would like to emphasize that Boeing intends
to continue complying with all of the financial accounting standards that relate to pensions and other
post-employment benefits. More important, Boeing recognizes that full, straightforward disclosure of
how benefits-related expense and obligations are developed, and how they are reflected in the Company's
financial statements, are of utmost importance to the Company's integrity and to all of the Company's
stakeholders -- employees, plan participants, and the investment community.

Sincerely yours,
Julie Curtis
Director of Actuarial Services
Cc: Jim Dagnon

=== END OF LAST UPDATE PRIOR TO MEETING

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