A shareholder has advised the Company that he intends to present the following resolution at the Annual Meeting. In accordance with applicable proxy regulations, the proposed resolution and supporting statement, for which the Board of Directors and the Company accept no responsibility, are set forth below. Approval of this proposal would require the affirmative vote of a majority of the outstanding shares of Boeing stock present in person or by proxy and entitled to vote at the Annual Meeting.

Shareholder Resolution

RESOLVED: Simple-Majority Vote Recommendation. Boeing shareholders recommend the Board of Directors take steps necessary to reinstate simple majority vote on all issues that are submitted for shareholder vote to the fullest extent possible. Recommend delete Boeing requirements for greater than a majority shareholder vote. Also, recommend that any future action on this topic be put to shareholder vote--as a separate proposal.

Why return to simple majority vote?

• Simple-majority resolutions won approval averaging 54% from shareholders at major companies in 1999 and 2000--Investor Responsibility Research Center.

• Boeing had 50 profitable years with simple-majority shareholder voting.

• Simple-majority vote follows logically from the "pride" in Boeing's "shareholder renaissance" cited in Boeing News.

What advantage is there for good corporate governance that includes simple-majority vote?

A new survey by McKinsey & Co., international management consultant shows that institutional investors are prepared to pay an 18% premium for good corporate governance.

McKinsey warns that companies that fail to reform will find themselves at a competitive disadvantage in attracting capital to finance growth.
   Wall Street Journal, June 19, 2000

Simple-Majority vote is particularly important when management needs greater accountability:

Federal Aviation Administration audit found "systemic" problems at 7 Boeing engineering and manufacturing facilities. Boeing agreed. Problems included inadequate inspections, inadequate employee instruction and processes not followed.
     Los Angeles Times, Oct. 31, 2000

Pentagon report cites major Boeing cost overruns on U.S. missile defense program. $125 million overrun in March 2000 followed by $194 million overrun in June 2000. The trend may deteriorate more.
   Bloomberg News, Aug. 25, 2000

Boeing executives to reap riches from stock's performance. Boeing gave 2,000 senior executives $140 million in stock last week under an incentive plan triggered by the company's recent stock price.

The plan could give the managers stock valued at $850 million in coming months if the shares trade at $75. Boeing Chairman Phil Condit stands to get about $23 million, according to company regulatory filings.
   Seattle Times, Oct. 3, 2000

Institutional Shareholder Services said that super-majority votes serve to lock in provisions that are harmful to shareholders. ISS said that super-majority may entrench management by preventing action that may benefit shareholders.
   Source: ISS Proxy Analysis, Maytag Corp., April 27, 1999.

To increase shareholder value recommend:

Board of Directors' Response

According to Delaware law, which governs the Company, most proposals submitted to a vote of the Company's shareholders, whether submitted by management or a shareholder, require a vote of a majority of the shares present and eligible to vote at the meeting, whether in person or by proxy. This is apparently what the proponent is referring to as a "simple-majority vote." In addition, Delaware law imposes a greater voting requirement, of at least a majority of the outstanding shares entitled to vote, for certain fundamental corporate actions, such as amending the certificate of incorporation, approving certain mergers, selling substantially all the assets or dissolving the corporation. The proposal cannot reduce this voting requirement to a "simple majority vote." The proponent is mistaken in asserting that Boeing should "return" to a rule it never had.

Delaware law also specifies that matters presented to shareholders may be subject to a greater percentage vote standard if that standard is set forth in a company's certificate of incorporation. Consistent with Delaware law, the Company's charter documents, which were approved by shareholder vote, provide that the vote of holders of at least 75% of the Company's outstanding shares must approve certain significant changes involving the Company. These changes include amendments to the by-laws or certificate of incorporation, significant mergers, sale of a significant proportion of assets and/or dissolution of the Company. For example, significant transactions involving "interested shareholders" must be approved by 75% of the outstanding shares unless disinterested directors of the Company satisfy themselves as to the fairness of the transaction for all shareholders. These "super-majority" provisions are designed to provide protection for all shareholders against the self-interest of a few large shareholders.

The provisions are not intended to, and do not, preclude unsolicited offers to acquire the Company at a fair price. They are designed to encourage potential acquirers to negotiate directly with the Board because the Company believes the Board is in the best position to evaluate the fairness of proposed offers, to negotiate on behalf of all shareholders and to protect shareholders from abusive tactics during a takeover process. Adoption of a proposal for a "simple majority vote on all issues" would eliminate these protections.

The Company believes the proposal would also cause it to violate Delaware law. The proposal purports to require that matters be subject to a "simple majority vote on all issues" without regard to the role of the Board of Directors. The Company could not, without violating Delaware law, permit adoption of any resolution by "simple majority vote" where such action is prohibited by law in the absence of prior approval and recommendation by the Board of Directors.

Approval of the proposal would not automatically eliminate the super-majority voting provisions described above, as this proposal is only a recommendation. If the proposal were passed, the Board could only approve and recommend the proposed changes if it determined that they were in the best interests of the Company and its shareholders. If the Board were to approve the amendments, adoption would require the favorable vote of shareholders owning 75% of the Company's outstanding shares.