The Board of Directors Unanimously Recommends
a Vote AGAINST This Proposal.

A shareholder has advised the Company that he intends to present the following resolution at the Annual Meeting. In accordance with the applicable proxy statement 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

Retention of Stock Obtained Through Options

RESOLVED: Shareholder request that our board of directors adopt a policy for senior executives and directors to commit to hold throughout their tenure at least 75% of all Boeing shares that they obtain by exercising stock options. This would include each option plan that our Board has the power to modify accordingly.

Proponent’s Supporting Statement

Since the accounting scandals at Enron, Worldcom and other companies, the role of stock options in executive compensation has become more controversial. Unlike direct stock holdings, stock options can also discourage executives from increasing dividends because option holders are not entitled to dividends. I believe stock options can provide incentives to senior executives which conflict with the interests of stockholders. For this reason I believe stock options can encourage actions to boost short-term performance.

I believe that this proposal is more important to our company than to some other companies because our company does not require that our directors own any minimum amount of stock.

This resolution proposes to align director and executive interests with those of shareholders by asking our directors and executives to commit that they will hold at least 75% of all Boeing stock that they obtain by exercising options for as long as they remain directors or executives. This policy seeks to decouple executive and director compensation from short-term price movements. This is designed to encourage greater emphasis on longer-term gains while giving directors and executive's flexibility by enabling them to sell 25% of their holdings at will.

I believe that adopting this policy would be a good way of assuring shareholders that our directors and senior executives are committed to long-term growth of the Company and not merely short-term gains.

I urge you to vote FOR this resolution.

Retention of Stock Obtained through Options
Yes on 9.

Board of Directors’ Response

The Board of Directors opposes this proposal because it is based on mistaken factual assumptions about the Company's equity incentive compensation programs, is unnecessary, and is not in the best interests of the Company and its shareholders.

As discussed in the "Compensation Committee Report on Executive Compensation," stock ownership is a fundamental principle underlying the philosophy and structure of the Company's executive compensation programs. The Compensation Committee has established stock ownership guidelines for executives that range from one to six times base salary (four to six times base salary for the Named Executive Officers). All current officers meet or exceed their guidelines. As a further incentive to encourage long-term stock ownership, the Company provides a 25% matching contribution on earned compensation that the executive defers into a stock unit account. These matching deferred stock units are distributed as Boeing stock or cash upon retirement, layoff, death or disability.

The Company's executive compensation program consists not of stock options but primarily of the following three types of awards, each of which accrues dividend equivalents in Boeing stock that are distributed when and to the extent that the awards vest or are earned:

• Boeing Stock Units, which are restricted stock units that are awarded upon the achievement of annual incentive goals and that vest over a three-year period,

• Performance Shares, a long-term incentive award consisting of rights to receive Boeing stock contingent on the Company's attaining total shareholder return goals within a five-year time period, and

• Career Shares, another long-term incentive award that are restricted units of Boeing stock paid only upon retirement, layoff, death or disability.

The Company's directors are not covered by the stock ownership guidelines for senior executives discussed above. However, this proposal as it relates to directors is unnecessary because directors are encouraged to and do own Boeing stock. As discussed under "Director Compensation," the Company's current director compensation program provides for a substantial portion of director compensation to be paid in deferred stock units under the Company's director deferred compensation plan, in addition to stock options. Nonemployee directors may also defer all or a portion of their cash compensation into additional stock units under the deferred compensation plan. As a further incentive to encourage long-term stock ownership, the Company provides a 25% matching contribution on all cash compensation a director defers into a stock unit account. These deferred stock units are distributed as Boeing stock after retirement or other termination of Board of Directors service. In 2003, directors deferred an average of 88% of the compensation they could have received in cash into deferred stock units. As shown in the Security Ownership table, these deferrals have resulted in Board members holding a significant economic interest in the Company.

In summary, the Board of Directors believes this proposal is unnecessary and, if implemented, would impose an arbitrary and inflexible policy regarding compensation of senior executives and directors that would impede the Company's ability to compete for and retain talented executives and directors.

The Board of Directors Unanimously Recommends
a Vote AGAINST Proposal 9.