Filed Pursuant to
Rule 424(b)(3)
File No. 333-37635
PRICING SUPPLEMENT NO. 49 DATED
JULY 20, 1999 TO PROSPECTUS
DATED JULY 31, 1998 AND PROSPECTUS
SUPPLEMENT DATED JULY 31, 1998
BOEING CAPITAL CORPORATION
Series X Medium-Term Notes
Due Nine Months or More From Date of Issue
Except as set forth herein, the Series X Medium-Term Notes offered
hereby (the "Notes") have such terms as are described in the accompanying
Prospectus dated July 31, 1998, as amended and supplemented by the Prospectus
Supplement dated July 31, 1998 (the "Prospectus").
Aggregate Principal Amount: $10,000,000
Original Issue Date July 27, 1999
(Settlement Date):
Stated Maturity Date: July 27, 2009
Interest Rate: 6.94%
Interest Payment Dates: March 15 and September 15, commencing
September 15, 1999
Type of Notes Issued: [X] Senior Notes [X] Fixed Rate Notes
[] Subordinated Notes [] Floating Rate Notes
Optional Redemption: [] Yes
[X] No
Form of Notes Issued: [X] Book-Entry Notes
[] Certificated Notes
CUSIP Number: 09700WCK7
PURCHASE AS PRINCIPAL
This Pricing Supplement relates to $10,000,000 aggregate principal
amount of Notes that are being purchased, as principal, Chase Securities Inc.
("Chase") for resale to investors at varying prices related to prevailing market
prices and conditions at the time or times of resale as determined by Chase. Net
proceeds payable by Chase to Boeing Capital Corporation (the "Company", "we",
"us" or "our") will be 99.591% of the aggregate principal amount of the Notes,
or $9,959,100 before deduction of expenses payable by the Company. In connection
with the sale of the Notes, Chase may be deemed to have received compensation
from the Company in the form of underwriting discounts in the amount of .409% or
$40,900.
RECENT DEVELOPMENTS
On June 22, 1999, the Company's Pricing Committee authorized the
issuance and sale from time to time of up to an additional $300,000,000
aggregate initial offering price of the Company's Series X Medium-Term Notes Due
Nine Months or More From Date of Issue, increasing the overall size of the
Company's Series X Medium-Term Note program under the current public shelf
registration (SEC No. 333-37635) from $900,000,000 to $1,200,000,000.
YEAR 2000 DATE CONVERSION STATUS UPDATE
The Year 2000 issue exists because many computer systems and
applications use two-digit date fields to designate a year. When the century
date change occurs, date-sensitive systems may recognize the year 2000 as 1900,
or not at all. This inability to recognize and properly treat the Year 2000 may
cause systems to process financial and operational information incorrectly. In
July of 1999 we decided to replace our independent advisory firm for Year 2000
matters with the independent advisory firm which installed our new lease
administration system (discussed below). The new firm has commenced work for us
and we are in the process of entering into a definitive agreement with them. As
further discussed below, we expect the new advisory firm to assist us in
converting our systems which are not Year 2000 compliant to systems which are
Year 2000 compliant.
We have assessed and continue to re-assess the impact of the Year 2000
issue on our information technology ("IT") systems. One of our principal IT
systems is our lease administration system, by which we keep track of our
leases, loans and certain other financial information. In 1996, we initiated a
conversion from our existing lease administration system to programs that we
have been advised are Year 2000 compliant. We plan to complete conversion of
this lease administration system in August of 1999. We plan to test the new
lease administration system during the third quarter of 1999 to confirm that it
is compliant. In the event that such testing proves the system not to be
compliant and the system cannot be made compliant prior to the end of 1999, our
operations could be materially adversely affected.
Our second principal IT system is our general ledger accounting system.
We use our general ledger system to keep track of our financial results. We are
in the process of selecting a general ledger accounting system which is
certified by its manufacturer to be Year 2000 compliant. We expect to commence
converting our general ledger accounting system to a Year 2000 compliant system
in the third quarter of 1999. While we expect the compliant accounting system to
be operational during the fourth quarter of 1999, our operations could be
materially and adversely affected if we fail to successfully implement the
conversion to the compliant accounting system before the end of 1999 and our
contingency plans with respect to the system fail.
With respect to our IT systems other than our lease administration
system and general ledger accounting system, we intend to develop contingency
plans during the second half of 1999 relating to possible Year 2000 problems to
the extent we deem necessary and appropriate, taking into account the advice of
the advisory firm which has begun examining our IT systems and which we expect
to complete its analysis approximately at the end of the third quarter of 1999.
Although we do not consider it likely that Year 2000 problems inherent
within our IT systems will result in significant operational problems, the
possibility of such problems cannot be discounted at this time.
With respect to our non-IT systems such as our telephone and elevator
systems, we have assessed and continue to re-assess the impact of Year 2000
issues on these systems. We believe that our non-IT systems are Year 2000
compliant. However, no assurance can be given that our operations will not be
materially adversely affected by problems with the non-IT systems related to the
Year 2000.
The total cost of the Year 2000 conversion efforts to date has been
funded through operating cash flows and has not had a material adverse effect on
our earnings, cash flow or financial position. Based on information available to
date, the cost of the Year 2000 conversion efforts, including any remediation of
our IT and non-IT systems (but excluding the cost of converting to a new lease
administration system, a project initiated in 1996 to accomplish our goal of
increasing productivity irrespective of the Year 2000 issue), is not expected to
have a material adverse effect on our earnings, cash flow or financial position.
We can give no assurance that Year 2000 problems of third parties (such
as vendors, customers and other financial institutions with which we do
business) will not materially and adversely impact our operations or operating
results. We are in the process of assessing the Year 2000 readiness of those
third parties whose lack of Year 2000 readiness could have a material adverse
impact on our operations. In early 1999, we identified and sent inquiries to
certain significant customers and third parties regarding their Year 2000
readiness. We have received a response from the majority of such third parties
and their responses to date do not indicate a likelihood that their lack of
readiness will have a material adverse effect on our operations. Our assessment
of the Year 2000 readiness of certain third parties will continue through 1999.
