Retirement Plan. Employee Benefits

Transcription

1 Employee Benefits Retirement Plan Summary Plan Description Union-Represented Aerospace Employees UAW 864, 887, 952, 1519, and 1558; IBPATA 36; IBCJA 721; IBEW 2295; and SMWIA 461 The summary plan description (SPD) for this Plan is this booklet and any summaries of material modifications (Updates). Updates are issued if the Company adds to or changes benefits in the Plan after the SPD is published. The Updates, if any, are incorporated at the end of this booklet. The content and delivery of this booklet are intended to comply with the Employee Retirement Income Security Act of 1974, as amended (ERISA). If there is any conflict between the information in this booklet and the official Plan document, the official Plan document will govern Edition I W

2 Plan Information and Notice The Boeing North American Retirement Plan for Eligible Employees on the Hourly Payroll, also known as the Aerospace Hourly Plan, is subplan R002 of the Boeing North American Retirement Plan (Plan 048 or the Plan ). The Plan contains many other subplans that cover different groups of employees (see Appendix E). Effective December 6, 1996, The Boeing Company (Boeing) purchased the Aerospace and Defense Operations of Rockwell International Corporation and renamed the new company Boeing North American, Inc. (BNA), a subsidiary of The Boeing Company. Effective January 1, 2000, BNA merged into The Boeing Company, and Plan sponsorship was transferred to The Boeing Company. You are eligible for this Plan if you are part of one of the eligible groups identified in Who Is Eligible in Section 1, Eligibility and Participation. Effective January 1, 2009, eligibility for the Aerospace Hourly Plan was closed. If you were hired or rehired on or after January 1, 2009, you are not eligible to participate in the Aerospace Hourly Plan. The Company, as used throughout this booklet, refers to Rockwell International Corporation before December 6, 1996; Boeing North American, Inc., after December 5, 1996, and before January 1, 2000; and The Boeing Company on or after January 1, Affiliates and subsidiaries of the Company refer to members of the applicable Company s controlled group. Summary Plan Description and Plan Document This booklet is designed to provide a general description of your benefits under the Aerospace Hourly Plan. The summary plan description for the Aerospace Hourly Plan is this booklet and any future summaries of material modifications (referred to as Updates). This booklet describes how the Aerospace Hourly Plan works and how benefits are paid to you. The actual Plan is a complex legal document that was written in accordance with Federal rules, including rules of the Internal Revenue Service and the Department of Labor. A copy of the Plan document can be obtained by contacting the Boeing Pension Service Center. See Section 10, Contacts. The contents and delivery of this booklet are intended to comply with the Employee Retirement Income Security Act of 1974, as amended (ERISA). If there is any conflict between the information in this booklet and the official Plan document, the official Plan document will govern. Any representations contrary to the Plan are not binding. Updates Periodically, the Company may add to or change benefits in the Aerospace Hourly Plan. If this happens, you will receive an Update describing the changes. Be sure to keep any Updates with this booklet. Notice of Company Rights The Company fully intends to continue the Plan. However, the Company reserves the right to terminate, suspend, or modify any benefits described in this booklet, in whole or in part, at any time, and for any reason for employees, former employees, retirees, and their dependents or beneficiaries. The Plan Administrator has the right to recover overpayments, regardless of the cause, nature, or source of the overpayments. The Plan Administrator may recoup overpayments (plus interest) by requesting a lump-sum payment from you, or by offsetting your future pension benefits, or by any other mechanism as determined by the Plan Administrator. This summary plan description booklet does not guarantee current or future employment or benefits. Receiving benefits under this Plan does not restrict the Company s rights to discharge any employee at any time. Effective Date Since the Plan was first established, the Plan has changed. This booklet highlights the benefits available to eligible employees and their eligible dependents under the Aerospace Hourly Plan as of January 1, 2012, unless otherwise noted. If you started your benefit or ended your employment before January 1, 2012, your benefits may be different from the benefits described in this booklet. Definitions of Terms Key terms used throughout this booklet are in bold the first time the term is used under each heading. You can find the definitions for these terms in Section 9, Definitions. ii Your Benefits Retirement Plan 2012 Edition W

3 Plan Highlights The Plan may be an important source of income for your future. The Plan is funded by The Boeing Company and its affiliates and subsidiaries that participate in the Plan. The Plan is intended to work with the Voluntary Investment Plan (VIP) and the Social Security program to provide retirement income. You are encouraged to build on this base through your own personal retirement savings and investments.? Key Features of the Aerospace Hourly Plan The Company makes all contributions to the Plan; you are neither required nor permitted to make contributions. Benefits are calculated by multiplying your years of credited service times the benefit rate in effect on your termination date. You earn a right to your benefit after completing 5 years of vesting service (10 years of vesting service before 1988). You may receive your vested Plan benefit at age 65, or you may receive a reduced benefit as early as age 55 if you have at least 10 years of vesting service. Several payment options are available. Generally, all options pay benefits monthly for your lifetime. Your pension benefits are insured, up to certain limits, by the Pension Benefit Guaranty Corporation, a U.S. Government agency. Retirement Plan 2012 Edition W Your Benefits iii

4 Table of Contents Section 1 Eligibility and Participation Who Is Eligible Who May Not Participate Employment With United Space Alliance, LLC (USA) Employment With United Launch Alliance, LLC (ULA) Your Ongoing Responsibilities Section 2 Service Your Service With the Company Vesting Service When You Become Vested Service With Rockwell, BNA, and Boeing Credited Service Break in Service Reemployment and Service Restoration Uniformed Service Section 3 Benefits Monthly Benefit Rate Credited Service Section 4 When You May Receive a Benefit Normal Retirement Age Early Retirement Ages 55 to Early Retirement Supplements Level Income Special Allowance Year Service Supplement Point Supplement Retirement From Layoff Status Terminated Vested Benefit Late Retirement Age 70½ Distribution Date Disability Benefit Amount of Disability Benefit Method of Payment Proof of Continued Disability iv Your Benefits Retirement Plan 2012 Edition W

5 Section 5 Benefit Payments Benefit Payment Options Single Life Annuity Joint and Survivor Annuity Qualified Optional Survivor Annuity Level Benefit Option Payment of Small Benefits Requesting Plan Benefit Payments Qualified Domestic Relations Order Death Before Benefit Commencement Date Postretirement Death Benefit Circumstances That May Affect Your Benefits Section 6 Claims and Appeals Section 7 Plan Amendment or Termination Section 8 Plan Administration and Legal Rights Your Rights and Protections Under ERISA Prudent Actions by Plan Fiduciaries Enforce Your Rights Receive Assistance With Your Questions Plan Information Unions Section 9 Definitions Section 10 Contacts Section 11 Appendix A Benefit Reductions for Early Retirement Section 12 Appendix B Benefit Reductions for Terminated Vested Former Employees Section 13 Appendix C Benefit Reductions Level Benefit Option Section 14 Appendix D Eligible Rollover Distributions (for Payment of Small Benefits Only) Section 15 Appendix E Other Subplans Under the Master Plan Retirement Plan 2012 Edition W Your Benefits v

6 Eligibility and Participation 1 Section Who Is Eligible Effective January 1, 2009, eligibility for the Aerospace Hourly Plan was closed. If you were hired or rehired on or after January 1, 2009, you are not eligible to participate in the Aerospace Hourly Plan. You are eligible for the Aerospace Hourly Plan if you were hired, or rehired, before January 1, 2009, and You are an hourly employee on the payroll of the Company and you are a member of the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America, Local No You were an hourly employee on the payroll of the Company and you were a member of one of the following unions: International Union, United Automobile, Aerospace and Agricultural Implement Workers of America Local No. 864 Local No. 952 Local No Local No International Brotherhood of Painters and Allied Trades of America, District Council No. 36 International Brotherhood of Carpenters and Joiners of America, Local No. 721 International Brotherhood of Electrical Workers, AFL-CIO, Local No Sheet Metal Workers International Association, Local No. 461 Who May Not Participate You are not eligible to participate in the Aerospace Hourly Plan if any of the following apply to you: You are a member of a union that has not accepted the Aerospace Hourly Plan. You are not and have never been paid hourly. You were hired, or rehired, on or after January 1, Hired or rehired generally refers to your most recent date of hire or rehire, except as follows: A return directly from a layoff from Boeing (or a Boeing affiliate or subsidiary) within six years is not considered a rehire, unless you commenced your benefit during that period. A return directly from an authorized leave of absence with Boeing (or a Boeing affiliate or subsidiary) without a termination of employment is not considered a rehire. A period of employment with United Space Alliance, LLC (USA) or United Launch Alliance, LLC (ULA) is considered an authorized leave of absence for this purpose, if you transferred directly from Boeing (or a Boeing affiliate or subsidiary) to USA or ULA, and back again. A direct transfer from Boeing (or a Boeing affiliate or subsidiary) to an adopting affiliate or subsidiary is not considered a rehire. You are working in a capacity that, in the sole discretion of the Plan Administrator, is considered contract labor or independent contracting. You accrue a benefit under any other defined benefit or money purchase pension plan maintained by a member of the Company s controlled group (or would accrue a benefit but for a limitation on benefit accruals). You are an employee of a Boeing affiliate or subsidiary for which the Aerospace Hourly Plan has not been approved. Employment With United Space Alliance, LLC (USA) If you directly transfer to USA from employment with the Company, you will continue to accrue vesting service, and you will receive Plan improvements while you are employed by USA. Alternate Plan provisions may apply if you moved between the Company and USA before March 1, Retirement Plan 2012 Edition W Eligibility and Participation 1-1

7 Employment With United Launch Alliance, LLC (ULA) If you directly transfer to ULA from employment with the Company, you will continue to accrue vesting service, and you will receive Plan improvements while you are employed by ULA. You may be eligible for a disability benefit under the Plan if you become totally and permanently disabled while employed by ULA and before you reach age 65 and you otherwise meet the requirements described in Disability Benefit, in Section 4. Your Ongoing Responsibilities You must keep the Company informed of your current address at all times. It may be necessary for the Company to contact you from time to time on matters relating to your pension benefit. If your address changes, it is important that you contact Boeing TotalAccess immediately to update your address. Keep your BEMSID and password, mailed to you by the Company, in a secure place. You will need your BEMSID and password whenever you access information about your pension benefit, whether you are an active employee, a retiree, or a terminated vested former employee. If you lose your BEMSID and password, call Boeing TotalAccess. If you leave the Company and are eligible to receive a pension benefit at a later date, you will be responsible for contacting the Boeing Pension Service Center through Boeing TotalAccess to request the forms to begin your benefit payments. See Requesting Plan Benefit Payments, in Section 5.? What is a BEMSID? Boeing takes the protection of information entrusted to us seriously. To protect the identity of those who access our TotalAccess system, Boeing limits the use of Social Security numbers as an employee identifier. Instead, Boeing uses unique employee identifiers called BEMSIDs as a replacement. 1-2 Eligibility and Participation Retirement Plan 2012 Edition W

8 Service 2 Section Your Service With the Company How long you work for the Company is important in determining the amount of benefits you earn. In general, you earn an hour of service for each hour you are paid by the Company. If you work the third shift, you will receive eight hours of service for each full shift worked. Hours worked at a premium (overtime) rate will be considered as straighttime hours for the purpose of determining hours of service under this Plan. You also will be credited with hours of service if you are an eligible employee and you are absent from work for certain reasons: If your absence is due to... Maximum service allowed... Layoff Medical leave of absence Work-related medical leave of absence Union business Peace Corps/VISTA service (followed by reemployment) Uniformed service Any other paid absence 13 weeks 52 weeks Entire period Entire period 25 months See Uniformed Service later in this section Up to 501 hours Forty hours of service are credited for each full week of an unpaid absence (pro rated on a daily basis at the rate of eight hours per day for a work-related medical leave of absence or union business). Hours of service for a paid absence are determined by dividing the payments you receive by your hourly rate of pay. Service for a given period of time will be counted only once, even if it can be described under more than one category above. The following paragraphs explain how your service affects your Plan benefits. Vesting Service Vesting service is used to determine whether you are eligible to receive a benefit. When you are vested, you have a nonforfeitable right to a benefit. This means you do not lose your right to a benefit when you terminate employment from the Company. You start to accumulate vesting service when you begin your employment. Generally, you earn one year of vesting service for each Plan year (January 1 through December 31) in which you have at least 1,000 hours of service. If you have fewer than 1,000 hours of service, you earn one twelfth of a year of vesting service for every 80 hours of service, rounded off to the nearest twelfth. In any case, you receive a minimum of one twelfth of a year of vesting service if you have at least 40 but fewer than 80 hours of service in a Plan year. For employment before 1976, vesting service was calculated differently. If you need more information, contact the Boeing Pension Service Center. When You Become Vested You are vested in the Plan if you Have completed 5 years of vesting service (10 years of vesting service if your employment terminated before 1988), or Are employed by the Company (or an affiliate or subsidiary of the Company) on your normal retirement date (see Section 4, When You May Receive a Benefit ). Retirement Plan 2012 Edition W Service 2-1

9 Service With Rockwell, BNA, and Boeing For the purpose of determining your years of vesting service, the Plan will count your service as follows: Any service earned under this Plan with Rockwell immediately before December 6, 1996, Any service earned under this Plan with BNA from December 6, 1996, though December 31, 1999, and Any service earned under this Plan with The Boeing Company on or after January 1, Credited Service Credited service is used to calculate the amount of your pension benefit. Once you become a Plan participant, you start to accumulate credited service. Only hours of service you have while you are an eligible employee count toward credited service. Generally, you earn one year of credited service for each Plan year (January 1 to December 31) during which you have at least 1,800 hours of service. If you have fewer than 1,800 hours of service in a Plan year, you receive credited service for part of a year. The amount of credited service you receive for a partial year is one twelfth of a year for every 150 hours of service during that year (rounded off to the nearest twelfth). For example, if you have 900 hours of service during a Plan year, you earn one half of a year of credited service for the year. In any case, you receive one twelfth of a year of credited service if you have at least 74.5 but fewer than 150 hours of service in a Plan year. You cannot earn more than one year of credited service for any Plan year (January 1 through December 31). For employment before 1976, credited service was calculated differently. If you need more information, contact the Boeing Pension Service Center. Break in Service If you have fewer than 501 hours of service in a Plan year, a break in service will occur for that year. If you are not vested when you experience a break in service, your service will be canceled, and you will lose all rights to benefits. However, service may be restored if you are reemployed, as explained in the next section, Reemployment and Service Restoration. When determining whether you experience a break in service, you will receive credit for any time (up to a maximum of 501 hours) that you were absent from work for maternity or paternity reasons if the time would have been counted otherwise. (If you earned more than 500 hours of service before your maternity or paternity leave begins, this credit will apply to the following Plan year, if necessary, to prevent a break in service.) Reemployment and Service Restoration If you experience a break in service and your vesting service and credited service are canceled because you are not yet vested, they may be restored after you are reemployed. In general, service will be restored if you are reemployed within five years of your break in service and you have at least 1,000 hours of service during the one-year period beginning on the date you are reemployed or any Plan year beginning after that date. If you return after five years, you still may be eligible for service restoration if you are reemployed by the Company and apply for hookup of prior service, subject to certain conditions. (Contact the Boeing Pension Service Center to apply for hookup of your prior service.) This will occur only if you fully meet the appropriate requirements. Under all other circumstances, you will be treated as a new employee when you are rehired. Uniformed Service If you take a leave of absence for service in the U.S. uniformed services (including the military, full-time National Guard, and the Commissioned Corps of the Public Health Service) and have reemployment rights under the Uniformed Services Employment and Reemployment Rights Act (USERRA), the time you spend in U.S. uniformed service will be used to calculate vesting service and credited service under the Plan, in accordance with applicable law. You must meet the requirements of USERRA, including notice to the Company, and return to employment within the prescribed periods. For more information about how uniformed service affects your Plan benefit, call the Boeing Pension Service Center. 2-2 Service Retirement Plan 2012 Edition W

10 Benefits 3 Section Monthly Benefit Rate The date on which you terminate from the Company will determine the benefit rate you are entitled to receive for each year of credited service, as shown in the following table. A separate schedule may apply if you retired (or terminated employment) and commenced your benefit before July 1, Monthly Benefit Rate If your benefit commencement date* is... Your monthly benefit rate for each year of credited service is... ** Effective... July 1, 1999, to September 30, 1999 $37 On commencement $40 October 1, 1999 $41 October 1, 2000 $42 October 1, 2001 $43 October 1, 2002 October 1, 1999, to September 30, 2000 $40 On commencement $41 October 1, 2000 $42 October 1, 2001 $43 October 1, 2002 October 1, 2000, to September 30, 2001 $41 On commencement $42 October 1, 2001 $43 October 1, 2002 October 1, 2001, to September 30, 2002 $42 On commencement $43 October 1, 2002 October 1, 2002, to December 31, 2003 $43 On commencement January 1, 2004, to June 1, 2004 $52 On commencement $55 January 1, 2007 July 1, 2004, to December 31, 2006 $52 On commencement January 1, 2007, to December 31, 2007 $55 On commencement January 1, 2008, to December 31, 2010 $64 On commencement On or after January 1, 2011 $75 On commencement * If you terminated employment for reasons other than death, retirement, or disability or if you qualify for early retirement and choose to defer your benefit commencement date until a later date, these rates are based on your date of termination and not on when you begin receiving benefits. ** If you retired and your benefit commencement date was before July 1, 2004, your benefit rate may have been increased as described in this table. For example, if your benefit commencement date was January 1, 2004, your benefit rate was increased to $55 for payments made on and after January 1, If you are a terminated vested former employee, your benefit rate does not increase. Retirement Plan 2012 Edition W Benefits 3-1

11 Example of a Monthly Benefit Calculation Assume you retired at age 65 on November 1, 2011, with 30 years of credited service. You choose a single life annuity as the payment option. Your pension benefit would be calculated as follows: Years of credited service 30 Monthly benefit rate x $75 Monthly benefit amount $2,250 Credited Service The Plan provides a benefit rate for each year of credited service you complete as an active Plan participant. In certain situations, the Plan limits your years of credited service, as shown in the following table. Credited Service Used to Calculate Plan Benefits for Retired Participants If your benefit commencement date is... Then your benefit is calculated using... Participants represented by all BNA UAW locals and other participating union locals Before July 1, 1999 July 1, 1999, through September 30, 1999 October 1, 1999, or later Up to a maximum of 35 years of credited service Up to a maximum of 35 years of credited service for payments issued through September 1999, and all your years of credited service beginning with the October 1, 1999, payment All your years of credited service Generally, you earn credited service for each Plan year during which you have at least 1,800 hours of service. If you have fewer than 1,800 hours of service in a Plan year, you will receive credited service for part of a year. 3-2 Benefits Retirement Plan 2012 Edition W

12 When You May Receive a Benefit 4 Section Once you become vested in your pension benefit, as described in Vesting Service in Section 2, the amount of retirement income you receive from the Plan is affected by the type of retirement for which you qualify and how you choose to receive your benefit payments. Generally, the types of retirement are Normal retirement. Early retirement. Retirement from layoff status. Terminated vested benefit. Late retirement. Disability retirement. Each type of retirement is described in this section. Normal Retirement Age 65 Your normal retirement date generally is the first day of the month following your 65th birthday, provided you have been employed by the Company (or an affiliate or subsidiary of the Company) for at least five years on that date. If at age 65 you have been employed for fewer than five years, your normal retirement date will be the earlier of (1) the date on which you have been employed for five years or (2) April 1 of the year following the year in which you attain age 70½ (even if you have been employed for fewer than five years on that date). When you take a normal retirement, your benefit becomes payable to you on the first day of the month following the date you retire. This is referred to as your benefit commencement date. Early Retirement Ages 55 to 65 You may retire directly from active employment or layoff as early as age 55 if you have at least 10 years of vesting service. If you leave the Company after becoming eligible to retire but before age 65, you may defer receipt of your benefit payments until the first month following your 65th birthday. When you take an early retirement, your benefit becomes payable to you on the first day of any month you choose following your termination of employment and before you attain age 65. This is referred to as your benefit commencement date. If you choose to defer your benefit commencement date, your benefit rate will be based on the rate in effect as of the date you terminated employment. Generally, if you begin receiving your pension benefit before age 62, your benefit will be reduced in accordance with the schedule in Appendix A, unless you qualify for a level income special allowance or 30-year service supplement, as described in the next section. If you begin receiving your benefit on or after your 62nd birthday, your benefit will not be reduced for early retirement. You must contact the Boeing Pension Service Center to commence this benefit. See Requesting Plan Benefit Payments, in Section 5. This benefit will commence on the first of the month following the date the Boeing Pension Service Center receives your complete pension package. Retirement Plan 2012 Edition W When You May Receive a Benefit 4-1

13 Early Retirement Supplements The Plan provides three types of early retirement supplements for participants who meet certain eligibility conditions and elect to retire directly from active employment. The early retirement supplements are The level income special allowance (LISA). The 30-year service supplement. The 85-point supplement (reduced in accordance with Appendix A). If you meet the eligibility conditions for more than one of these supplements, you may choose only one. Once you begin receiving your early retirement supplement, you cannot switch supplements. Generally, these supplements begin at a specified age within the early retirement age range of age 55 up to age 62. The supplement generally will continue until you reach age 62 become eligible for Social Security old age or disability benefits, or die, whichever occurs first. Early retirement supplements are not available to you if you are receiving a disability retirement benefit or if you elect the level benefit payment option described in Section 4, When You May Receive a Benefit. Your early retirement benefit will be unreduced if you meet the eligibility requirements for the Level Income Special Allowance supplement or the 30-year service supplement. However, early retirement reductions still apply if you only meet the eligibility requirements for the 85-point supplement. Level Income Special Allowance The LISA supplement will apply if you qualify for early retirement and you Have at least 20 years of credited service under this Aerospace Hourly Plan, including any credited service earned under the Boeing North American Retirement Plan for Eligible Employees on the Salary and Weekly Payrolls, subplan R001 of the Boeing North American Retirement Plan (the Aerospace Salaried Plan), Begin receiving your pension benefits on the first day of the month following the date you retire from active employment with the Company, and Are at least age 60 but younger than age 62 when you begin receiving benefit payments. The amount of the LISA supplement is $650 per month. 30-Year Service Supplement The 30-year service supplement will apply if you qualify for early retirement and you Have at least 30 years of credited service under this Aerospace Hourly Plan (including any credited service earned under the Aerospace Salaried Plan), Begin receiving your pension benefit on the first day of any month following the date you retire from active employment with the Company, and Are at least age 55 but younger than age 62 when you retire. The 30-year service supplement is $650 per month. 85-Point Supplement The 85-point supplement applies if you qualify for early retirement and The sum of your age and the number of years of combined credited service (in this Aerospace Hourly Plan and the Aerospace Salaried Plan) equals 85 or more, You have less than 30 years of credited service under the Aerospace Hourly Plan (including any credited service earned under the Aerospace Salaried Plan), and You begin receiving your pension benefit on the first day of any month following the date you retire from active employment with the Company, and You are at least age 55 but younger than age 60 when you retire from active employment with the Company. The 85-point supplement is $650 per month. If your benefit commencement date was between July 1, 1999, and September 30, 1999, the amount of the 85-point supplement increased to $650 beginning with the October 1999 payment. 4-2 When You May Receive a Benefit Retirement Plan 2012 Edition W

14 Retirement From Layoff Status If you are placed on layoff status, you may be eligible to retire and have your pension calculated as if you are retiring directly from active employment. To be eligible to retire from layoff status, you must Be at least age 50 on the date you are laid off, Have 10 or more years of vesting service under the Plan and Reach age 55 within your layoff recall rights period. If you are placed on layoff status on or after age 55 and you have 10 or more years of vesting service under the Plan, you will be eligible to retire immediately. Terminated Vested Benefit If you stop working for the Company before becoming eligible for disability or retirement benefits but after becoming vested, you will be considered to be a terminated vested former employee, meaning that you will have a vested right to a benefit under the Plan. Your benefit under this Plan generally is payable to you on the first day of the month after you attain age 65 or, if you have at least 10 years of vesting service, the first day of any month you choose after you attain age 55; this is referred to as your benefit commencement date. If you do start your benefit before age 65, your benefit will be reduced as shown in Appendix B. The Boeing Pension Service Center must receive your completed application before your benefit payments may begin. Important Note: Terminated vested former employees do not qualify for retiree medical coverage or the postretirement death benefit described in Section 5, Benefit Payments. Because important information about the Plan and your vested pension benefit may be mailed to you from time to time, you are encouraged to notify the Boeing Pension Service Center when your address changes for any reason, even if you are not yet receiving benefits. Late Retirement A late retirement generally is the first day of the month following the date you retire beyond the normal retirement date defined in Normal Retirement Age 65, in this section. If you continue working for the Company after your normal retirement date, the Plan will provide you with a late retirement benefit. A late retirement benefit generally is calculated in the same way as a normal retirement benefit. You will continue to earn credited service under the Plan while you are employed, but you will not begin to receive any benefit payments until your employment with the Company ends or until April 1 of the year following the year in which you reach age 70½, whichever happens first. When you work for the Company past the normal retirement date, you experience what the U.S. Department of Labor considers a suspension of benefits. This means that during the period you are actively at work between the normal retirement date and April 1 of the year following the year in which you attain age 70½, you will not receive pension benefits even if you are eligible to retire and you elect to receive your benefits. In general, your benefits will not begin before April 1 of the year following the year in which you attain age 70½ unless you retire. When you take a late retirement, your benefit becomes payable to you on the first day of the month following the date you actually retire. This is referred to as your benefit commencement date. Age 70½ Distribution Date If you are still working for the Company and have not begun to receive your pension benefits by April 1 of the year following the year in which you attained age 70½, your benefits under the Plan automatically will be initiated for you at that time. Payments are paid retroactively to January 1 of the year following the year in which you attained age 70½. This is referred to as the age 70½ distribution date. Benefits at that time will be based on the credited service earned through December 31 of the year in which you turned age 70½. If you do not elect a payment option, your benefit will be paid as a single life annuity. If you continue to work beyond your age 70½ distribution date, your benefit will be recalculated each subsequent year to incorporate additional benefits earned for the calendar year immediately preceding the year in which such recalculation is made. Retirement Plan 2012 Edition W When You May Receive a Benefit 4-3

15 Disability Benefit If you become totally and permanently disabled while an eligible employee and before you reach age 65, you may qualify for disability pension benefits from this Plan. To be eligible for disability pension benefits, you also must meet the following conditions: You must have 10 or more years of vesting service. You must be an eligible employee under this Plan at the time of disability. Your disability must continue for six consecutive months from the date deemed disabled by the Social Security Administration. You must provide a Social Security Administration determination of disability as proof of your disability. You must formally apply for a disability benefit by contacting the Boeing Pension Service Center. Disability benefits are not available to terminated vested former employees or to participants who become disabled after retirement. When you become eligible for a disability retirement, your benefits become payable to you on the first day of the month following the date you applied for benefits and have been deemed to be totally and permanently disabled, as defined by the Plan. This is referred to as your benefit commencement date. Amount of Disability Benefit The amount of your disability benefit will equal your years of credited service multiplied by the benefit rate shown in Monthly Benefit Rate, in Section 3. Your benefit rate will depend on the date you begin your disability retirement benefit. Method of Payment If you are not married and you are at least age 55 on your benefit commencement date, your disability benefit will be paid as a single life annuity. If you are married and you are at least age 55 on your benefit commencement date, your disability benefit will be paid as a joint and survivor annuity, unless you formally elect to receive a single life annuity or qualified optional survivor annuity and your spouse consents to your election. (See Section 5, Benefit Payment Options, for information about these methods of payment.) If you are younger than age 55 on your benefit commencement date, your disability benefit will be paid as a single life annuity. If you are married on the date you reach age 55, your future payments will be paid in the form of a joint and survivor annuity unless you elect (and your spouse consents) to continue receiving your benefit in the form of a single life annuity or qualified optional survivor annuity. Affected participants will be contacted by the Boeing Pension Service Center with information about making this election. If you die before age 55 while receiving a disability benefit, your surviving spouse will be eligible to receive a monthly lifetime benefit equal to the amount he or she would have received if you had survived to age 55 and elected the joint and survivor annuity. This benefit will be payable based on the date you would have attained age 55. Proof of Continued Disability You may be required by the Plan Administrator to provide proof that you are continuing to receive Social Security disability income benefits at any time (not more often than twice a year) as a condition for receiving continued disability benefits. You must also notify the Plan Administrator when Social Security disability income benefits cease. If you do not provide proof of continued receipt of Social Security disability income benefits upon request, or if those benefits cease, your disability benefit payments under the Plan will be discontinued. 4-4 When You May Receive a Benefit Retirement Plan 2012 Edition W

16 Benefit Payments 5 Section Benefit Payment Options The payment options available under this Plan are A single life annuity. A joint and survivor annuity. A qualified optional survivor annuity. The level benefit option. Generally, after you start receiving payments, you may not change your payment option. However, if you elect a joint and survivor annuity or a qualified optional survivor annuity, you may be allowed to change your benefit election if your spouse dies before you, as described in this section. Single Life Annuity Under this payment option, you receive a monthly benefit payment for your lifetime. No monthly payments are made after your death. If you are married, you will need your spouse s written consent to elect this option. Your spouse must sign the appropriate form and have it witnessed by a notary public. Joint and Survivor Annuity Under this payment option, you receive a reduced monthly benefit payment for your lifetime. If you die before your spouse, your surviving spouse will receive 55 percent of your reduced monthly benefit for life. If your spouse dies before you, you may request to change your form of payment back to a single life annuity. This change is not automatic; you must submit your request in writing to the Boeing Pension Service Center. The change will become effective on the first day of the month following your spouse s death. Because the Plan is paying a benefit over the lifetimes of two people, the initial monthly benefit amount is smaller than it would be if it were paid as a single life annuity, as shown in the following table. Benefit Reductions for the 55% Joint and Survivor Annuity Spouse s Age Within five years of your age More than five years younger than you More than five years older than you Benefit Reduction 95% of your single life annuity Reduced by an additional 0.5% for each full year of age in excess of five years Increased by an additional 0.5% for each full year of age in excess of five years, to a maximum benefit of 100% If you terminated employment before October 1, 1972, and commenced your benefit before July 1, 2008, then your initial monthly benefit amount was calculated as 90% of the monthly amount that would have been paid to you under a single life annuity. Qualified Optional Survivor Annuity Under this payment option, you receive a reduced monthly benefit payment for your lifetime. If you die before your spouse, your surviving spouse will receive 75 percent of your reduced monthly benefit for life. If your spouse dies before you, you may request to change your form of payment back to a single life annuity. This change is not automatic; you must submit your request in writing to the Boeing Pension Service Center. The change will become effective on the first day of the month following your spouse s death. Retirement Plan 2012 Edition W Benefit Payments 5-1

17 Because the Plan is paying a benefit over the lifetimes of two people, the initial monthly benefit amount is smaller than it would be if it were paid as a single life annuity. The reduced benefit is the actuarial equivalent of the single life annuity. Actuarial equivalence is calculated using certain interest and mortality assumptions specified in the plan document. Level Benefit Option If you retire and decide to begin benefits before age 62, you may choose the level benefit option. This option allows you to collect a larger than normal portion of your Company benefit before age 62 (when you have no Social Security income) and a smaller than normal benefit afterward. When you reach age 62, your benefit will be reduced even if you elect to defer commencement of your Social Security income. This payment option will not be available if you elect and are granted a disability retirement, if you are a terminated vested former employee, or if you elect an early retirement supplement. Payment of Small Benefits If the actuarial equivalent value of your total benefit under the Plan is $5,000 or less (including any benefit under any other subplan) at the time you are scheduled to commence benefit payments, you shall receive a lump-sum payment. The Boeing Pension Service Center will notify you if the actuarial equivalent value of your benefit under the Plan is $5,000 or less as of your benefit commencement date. See Appendix D for details about rolling over your lump-sum distribution. Requesting Plan Benefit Payments It is your responsibility to request your pension benefit when you want to begin receiving it. Follow these steps to apply: 1. Request your pension package. Contact the Boeing Pension Service Center to request your pension package up to 90 days before you want your pension benefits to begin. To contact the Boeing Pension Service Center through Boeing TotalAccess, you may use the Boeing Web (my.boeing.com) or the World Wide Web (www. boeing.com/express). You may also contact the Boeing Pension Service Center by telephone (call ; hearing-impaired callers should use the relay service offered through their telephone service provider). Boeing Pension Service Center representatives can provide you with information about your pension benefits. If your question cannot be answered immediately, it will be researched, and you will be contacted with the answer. Representatives are available to talk with you Monday through Friday from 9 a.m. to 8 p.m. Eastern time (8 a.m. to 7 p.m. Central time; 7 a.m. to 6 p.m. Mountain Time; 6 a.m. to 5 p.m. Pacific Time). You must have your BEMSID and Boeing TotalAccess password when you use the World Wide Web or telephone. 2. Review your pension package. The Boeing Pension Service Center will mail your pension package to your home. Carefully read though the materials in the pension package as soon as possible. You may need to allow time to gather documentation, such as your marriage certificate and birth certificates for you and your spouse. Depending on the payment option you choose, you may need your spouse s consent, which will require your spouse s signature to be notarized. If you have any questions, call the Boeing Pension Service Center immediately to avoid processing delays. 3. Return your completed forms and documentation. Complete the required forms and return them, along with any requested documentation, according to the instructions in your pension package. The Boeing Pension Service Center must receive the forms and documentation as soon as possible for benefit payments to begin as scheduled. You must return the completed forms and documentation within 30 days before the date you request your pension benefits to begin or your benefit commencement date will be postponed. If you change your mind after submitting your forms and want to delay receiving your pension payments, you must notify the Boeing Pension Service Center in writing. The written notification must be received before the date your benefits are scheduled to begin. When you are ready for payments to begin, you must call the Boeing Pension Service Center to begin the process again. 4. Process your termination. If you are an active employee, your termination must be processed before pension payments can begin. If you are on a leave of absence or need assistance, contact your manager or Human Resources representative. 5-2 Benefit Payments Retirement Plan 2012 Edition W

18 Note: Your pension package contains an estimate of your pension benefit. The Plan Administrator uses its best efforts to ensure all information in your pension package is accurate and complete. The amount you receive will be calculated upon receipt of your completed forms and documentation and is always limited by what is allowed under the Plan. Any inaccuracy or errors cannot increase the benefits (if any) otherwise payable to you under the Plan. Please review your pension package carefully and promptly notify the Plan Administrator if you identify any discrepancies or inaccuracies. The Plan Administrator has the right to correct any errors in your benefit calculation, regardless of the cause, nature, or source of the errors, at any time, including retroactively. The Plan Administrator has a duty to recover overpayments and correct underpayments, regardless of the cause, nature, or source of any administrative errors. The method of correction shall be determined by the Plan Administrator, in its sole and complete discretion, and may include offsets of future benefit payments and recovery of prior benefit payments. Qualified Domestic Relations Order Federal law generally protects your benefits under this Plan from assignment and transfer to others. However, the Retirement Equity Act of 1984 specifically provides that this protection does not apply to a qualified domestic relations order (QDRO). A QDRO is a judgment, decree, or order that relates to divorce decrees, property assignments, and child support orders. If a court order of this type is received, you will be advised in writing. For additional information regarding QDROs, please call the Boeing Pension Service Center through Boeing TotalAccess. You may request a copy of the Plan s general procedures governing QDROs, without charge on the Company s website through Boeing TotalAccess or by writing to the Employee Benefit Plans Committee, which may be reached at The Boeing Company, 100 North Riverside, MC , Chicago, IL Death Before Benefit Commencement Date If you are vested and you die before your pension benefits begin, your surviving spouse may be eligible for a lifetime benefit under the Plan. It is important that you notify the Boeing Pension Service Center if your marital status changes. Eligibility and payment amounts are based on several factors, including your age and length of service. To apply for benefits, your surviving spouse must provide proof of marriage, copies of birth certificates, and proof of your death. If you are an active employee and you die with at least 10 years of vesting service, the surviving spouse benefit will be calculated and paid as if you had elected benefits to begin on the first day of the month coinciding with or immediately following your death as a joint and survivor annuity. This means that the surviving spouse benefit will be reduced by the factors that apply to employees who retire from active service and by the joint and survivor annuity option reduction factor. If you die before age 55, the applicable early retirement reduction factor will be used. Payments to your surviving spouse will begin on the later of the first day of the month following your death or the earliest date you would have been eligible to begin receiving your benefit, unless your surviving spouse elects to defer payment. If you are an active employee and you die with at least 5 but fewer than 10 years of vesting service, the surviving spouse benefit will be calculated as described above. However, payments will not begin until you would have reached age 65. If you are a terminated vested former employee with at least 10 years of vesting service, the surviving spouse benefit will be calculated and paid as if you had elected to receive your vested pension benefits under a joint and survivor annuity. This means the surviving spouse benefit will be reduced by the reduction factors that apply to terminated vested former employees and by the joint and survivor annuity option reduction factor. If you die before age 55, payments will not begin until you would have reached age 55. If you die at or after age 55, payments will begin on the first day of the month following your death. In either case, your surviving spouse may elect to defer payment. If you are a terminated vested former employee with at least 5 but fewer than 10 years of vesting service, the surviving spouse benefits will be calculated as described above. However, payments will not begin until you would have reached age 65. If you did not earn at least an hour of credited service after September 2, 1974, the Plan may provide a different preretirement death benefit. Contact the Boeing Pension Service Center for more information. Retirement Plan 2012 Edition W Benefit Payments 5-3

19 Postretirement Death Benefit If you retire as an eligible employee, your beneficiary will be eligible to receive a $1,000 death benefit from the Plan. This benefit will be paid as a single lump sum after your death to the person you designate as your beneficiary on your Benefit Commencement Election form provided by the Boeing Pension Service Center. If you do not designate a beneficiary, the benefit will be paid to your spouse and, if you do not have a spouse, the benefit is paid to your estate. The postretirement death benefit is in addition to the benefits continued under the joint and survivor annuity or the qualified optional survivor annuity option, if any, as explained in Benefit Payment Options in this section. The postretirement death benefit does not apply to terminated vested former employees nor to disabled participants with continued protection under the life insurance program. No postretirement death benefit from the Plan will be payable if a death benefit is paid (or is payable) from any group life insurance plan to which the Company (or an affiliate or subsidiary of the Company) contributes. This exclusion does not apply if you retire early from active service. Circumstances That May Affect Your Benefits Under certain conditions, you may not receive pension benefits, or you may receive smaller payments than you expected. The following are some examples of such cases: If you do not meet the eligibility requirements of the Plan, you will not earn benefits. If your employment terminates before you are vested, no benefits will be payable. If you do not use the designated forms from the Boeing Pension Service Center or do not complete them in a timely manner, benefits could be delayed or postponed. If you do not meet retirement age requirements, no vested benefits will be payable until you do. If you experience a layoff or your employment terminates, your benefits could be affected. If you fail to work enough hours in a plan year, you will not earn a full year of vesting service or credited service. If you receive benefits as a single life annuity, benefits will stop when you die. Your surviving spouse will not receive benefit payments after your death. If you recover from a disability and/or return to work, your disability benefits will stop. If you receive disability payments from the Company, or from a Company-funded insurance plan, then your disability pension will be reduced accordingly. If you (or your beneficiary) fail to make a timely appeal of denied benefits, no benefits will be payable. If you are subject to a QDRO, a portion of your benefit could be paid to an alternate payee. If you are not eligible for a particular benefit because you retired before that benefit became effective or because you are a terminated vested former employee, that benefit will not be payable. If your employment ends and you do not return to work or you are rehired but do not meet the necessary requirements for restoration of service, benefits in which you are not vested will not be payable. If the Plan terminates, your benefits will be guaranteed by the Pension Benefit Guaranty Corporation (PBGC) up to certain limits. If your Plan benefit exceeds PBGC limits, you may not receive the entire benefit you have earned. The Company does not guarantee any of the benefits payable under the Plan. If you have any questions concerning your application or would like additional information, please call the Boeing Pension Service Center. In addition, if you have an issue regarding your benefit or your right to receive a benefit under the Plan, this often can be resolved by calling the Boeing Pension Service Center and discussing the situation with a representative. If the issue is not resolved through an informal process, you may file a formal claim. 5-4 Benefit Payments Retirement Plan 2012 Edition W

20 Claims and Appeals 6 Section In general, if you have an issue regarding your benefit or your right to receive a benefit under the Plan, this can often be resolved by calling the Boeing Pension Service Center through Boeing TotalAccess and discussing the situation with a representative. If the issue is not resolved with a telephone call, you may file a formal (written) claim with the Plan. If your application for retirement benefits is denied, the Plan has established the following procedures for initiating a formal claim and appeal of denied benefits under the Plan. Copies of the claim and appeal procedures for the Plan are available by sending a written request to the Employee Benefit Plans Committee at The Boeing Company, 100 North Riverside, MC , Chicago, IL A formal claim for benefits should be sent in writing to Boeing Pension Operations, The Boeing Company, P.O. Box 3707, MC 11-59, Seattle, WA Boeing Pension Operations will respond in writing within 90 days of receiving the claim. If special circumstances require more time, the review period may be extended up to an additional 90 days. You will be notified in writing of this extension. If your formal claim is denied, you will be notified in writing, given the specific reasons for denial, referred to the pertinent Plan provisions on which the denial is based, given a description of any additional material or information necessary to perfect your claim and an explanation of why it is necessary, and advised of your appeal rights. You or a person you appoint may appeal a denial of benefits by writing to the Employee Benefit Plans Committee at The Boeing Company, 100 North Riverside, MC , Chicago, IL , within 60 days of receiving notice of the denial or partial denial of Plan benefits. You must indicate the reason for your appeal and may include any information or documents that you believe are relevant to the claim. If you do not appeal within 60 days of receipt of the benefit determination notice, you will be deemed to have waived your right of appeal. The Committee will review your appeal, render a decision, and notify you of its decision within 60 days of receipt of your appeal. If special circumstances require more time, the review period may be extended up to an additional 60 days. You will be notified in writing of this extension. If the Committee makes an adverse benefit determination on appeal, you will be notified in writing, given the specific reasons for denial, referred to the pertinent Plan provisions on which the denial is based, informed that you may receive, upon request and free of charge, reasonable access to and copies of all documents, records, and other information relevant to your claim, and informed that you may bring a civil action under section 502(a) of the Employee Retirement Income Security Act of 1974, as amended (ERISA). Any action must be commenced within 180 days following the decision on appeal of your initial claim for benefits (or following the last date for filing an appeal, if no appeal is taken). Benefits will be paid under the Plan only if the Committee decides in its discretion that you are entitled to them. It is the Committee s exclusive right to interpret the terms of the Plan, to resolve eligibility for benefits, and, exercising its discretion, to resolve all questions arising under the Plan. The decision of the Committee is final and binding. Retirement Plan 2012 Edition W Claims and Appeals 6-1