Association of Raytheon Retirees, Inc. Annual Meeting May 22, 2014

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1 Association of Raytheon Retirees, Inc. Annual Meeting May 22, 2014

2 2 Meeting Information - Rest Rooms - Emergency Exits - Refreshments - Name Tags - Sign In Reminder - Raffle Tickets - New Member Applications - Review your address and contact information

3 Agenda 3 Welcome and Introduction: John Rudy Business Meeting - Directors Reports Mel Weinzimer Finance Communication Membership Retiree Medical: Joe DeAmbrose Pension Status: Al Swenson Break Keynote Speaker: Michael Daly, Raytheon Cyber Security Break Guest Speaker: Tony Jagodnik, Residential Solar Power Adjourn Lunch and Socialize Residential Solar Power Part 2

4 Older Americans Month 4 Each May, the nation celebrates Older Americans Month to recognize older Americans for their contributions and provide them with information to help them stay healthy and active. This year, we* are focusing on injury prevention with the theme Safe Today Healthy Tomorrow * US Department of Health and Human Services Administration for Community Living

5 5 Your Directors Director Years at Raytheon Raytheon Background Bill Burditt 38 International Business Mgmt. Joe DeAmbrose 30 Director, Taxation Evans Cheeseman 31 Manager, Pension Administration Bob Hamilton 27 Programs Manager Jack O Halloran 32 Manufacturing Manager John Rudy 41 IT/Engineering Management Al Swenson 34 Controller, Director of Internal Audit Mel Weinzimer 38 Director, Surveillance Programs And Kaitlyn Agostino, our Office Manager No Terms Will Expire in 2014

6 6 In Memoriam Dave Barthuli Charles Hoffman Stan Nelson Ken Wilkenson Patricia Bellefeuille Dick Burgess Roger Desjardins R. Albert Dion Richard Eng Larry Fisher John Gillick Jr. Ken Hartford Don Lamm Richard Lawson Ronald P. LeBlond Helmut Lelke John Long Frederick J. Machado Thomas Marshall Jr. Vin Milano Francis O Hara Dr. Irwin Bob Roll Charlie Smith Donald (Don) J. St. Jean Ronald J.Stapleton Bill Thibodeau Frederick Vitali Harold Whittenberg

7 7 Director Reports - Finance - Communication - Membership

8 8 Financial Report Total Year 2013 Revenue $11,415 Expenses 16,058 Net $(4,643) Total Assets $36,321

9 9 Communication Report Newsletter Web Site Facebook Linked In (TBD) Member Requests

10 Newsletter 10

11 11 HOME PAGE LIVE NEWS

12 Web Site 12 NEWSLETTER ARCHIVE ARTICLES

13 WEB SITE 13 MEMBERS LIST

14 FACEBOOK RAYTHEON RETIREES GROUP 14

15 SIGN UP FOR OUR FACEBOOK GROUP If you are not a facebook member join. 15 If you have a Facebook account log-on as you normally do. At the search bar on top type in Raytheon and one of the results is the retirees group. Click on it and you open the group and it looks like any other Facebook group. By all means join it.

16 16 Member Requests Benefits Information Locate Retirees Special Requests

17 1196 Active Members Membership Profile Reside in 35 states & Abroad Predominately legacy Raytheon 8.0% 10% 60% MA NH FL CA ME TX Other 17 On-line Registrations Our retirees continue to stay in touch with their Raytheon friends and co-workers

18 18 Welcome New Members David Boggie Frank Clark George Delgado Robert Dinizzi Charlie Ebent Cyndi Ferguson Geoge Fix Robert Harris Christopher Kenely Jack Kidd Alan Klainbaum Darrel Lamb John Lennox Gary Marcelynas Terri Munson Beverly Nickerson Patricia Portnoy Ben Sammons Peg Silva Dennis Smith Boris Subbotin James Traniell Richard Walsh Denis White George Williams

19 Social Events 19

20 Reach out to friends, associates, fellow retirees and encourage them to join and/or renew membership 20 On-line sign up available on our web site Refer a new member and earn one year s free membership We need your support Be an Ambassador

21 21 Financial Overview of Retiree Medical and Life Insurance Joe DeAmbrose

22 22 Life Insurance Primarily Legacy Raytheon 10% of Pre-Retirement Coverage Funding-Retired Lives Reserve Met Group Life Policy A26808-G Funding Estimate--$50M-$100M Met Life Certificate

23 23

24 raytheon.benefitcenter.com

25 Medical Financial Highlights (Millions) VEBA Assets Pension Assets Total Assets Total Liability $217.4 $230.1 $214.2 $225.0 $170.5 $186.7 $171.7 $179.1 $387.9 $416.8 $385.9 $404.1 $687.5 $618.1 $633.1 $619.9 Unfunded Liability $299.6 $201.3 $247.2 $215.8 Participants 22,588 20,759 20,479 20,072 25

26 26 Medical Financial Highlights Other Medical Data (Millions) Benefits Paid $67.3 $60.1 $61.1 $57.9 Raytheon Contributions Employee Contributions $24.6 $18.9 $14.1 $13.8 $33.6 $32.1 $32.3 $30.3 Actuarial Gains $29.5 $9.2 $11.1 $14.7 Change in Actuarial Assumptions Raytheon Direct Payments Administrative Expenses $ $28.7 -$7.2 $15.9 $20.9 $20.7 $28.8 $5.0 $6.5 $4.7 $2.1 Participants 22,856 20,759 20,759 20,072

27 27 Pension Review for 2013 Allen Swenson

28 Pension Fund Status 28 Outline Raytheon Commitment Fund balances Changes in fund balance Funding requirements 2013 Raytheon financial results Sources Met with Raytheon Treasury 5/8/13 Annual Report and Raytheon 10K

29 29 Raytheon Co. Commitment Joanne Bockmiller - Vice President, Raytheon Company letter dated April 30, 2014 As we have done in the past, we want to assure you that Raytheon remains fully committed to meeting all pension benefit obligations to the more than 63,000 retirees and survivors, estimated at over one billion dollars for Additionally Raytheon remains fully committed to paying pension benefits to our future retirees and survivors, just as we have done for almost 60 years.

30 30 Pension Fund Balances Fund Balance 12/31/13 ($ In Millions) 12/31/13 % Raytheon Policy Equities 10,430 56% % Fixed Income 5,188 27% % All Other 3,386 17% 0-40 % Total 19, %

31 31 Pension Fund Changes ($ in Millions) Beginning Balance 1/1/13 16,907 Actual Return on Plan Assets 2,681 Company Contributions 1,000 Benefits Paid, est. <1,400> Other (est.) <184> Ending Balance 12/31/13 19,004

32 32 Pension Funding Domestic Plans (Estimated) 96% Accumulated Benefit Obligation (ABO) 88% Projected Benefit Obligation(PBO) Funding anticipated to be 100% PBO by 2016

33 Raytheon Company Financial Results Net Sales: 24.9B 24.4B 23.7B Adjusted Income: 2.1B 2.1B 2.1B Adjusted Earnings per Share: Operating Cash Flow From Operations: Dividends Declared per Share: $5.90 $6.21 $ B 2.0B 2.4B $1.72 $2.00 $ Was Another Strong Year for Raytheon

34 34 See the Changing Face of Radar Video Shown in the Lobby PROVIDED BY MIKE BRIANA

35 Break 35

36 36 Keynote Speaker MICHAEL K. DALY CTO RAYTHEON CYBER SECURITY & SPECIAL MISSIONS

37 Break 37

38 Guest Speaker TONY JAGODNIK RESIDENTIAL SOLAR POWER A FORTY YEAR STORY

39 39

40 40

41 Raffle 41

42 42 Thank You For Coming This concludes our formal membership meeting Please join us for lunch Stay and visit with friends, see the museum or stay for Part 2 of Tony Jagodnik s presentation Stay well and thanks for joining us

43 Lunch 43