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83
Note 12 – Arrangements with Off-Balance Sheet Risk
We enter into arrangements with off-balance sheet risk in the normal course of business, primarily in the
form of guarantees.
The following table provides quantitative data regarding our third party guarantees. The maximum potential
payments represent a “worst-case scenario,” and do not necessarily reflect amounts that we expect to
pay. Estimated proceeds from collateral and recourse represent the anticipated values of assets we could
liquidate or receive from other parties to offset our payments under guarantees. The carrying amount of
liabilities represents the amount included in Accrued liabilities.
Maximum
Potential
Payments
Estimated
Proceeds from
Collateral/
Recourse
Carrying
Amount of
Liabilities
December 31, 2015 2014 2015 2014 2015 2014
Contingent repurchase commitments $1,529 $1,375 $1,510 $1,364 $7 $5
Indemnifications to ULA:
Contributed Delta program launch
inventory 107 114
Contract pricing 261 261 77
Other Delta contracts 231 150 5
Other indemnifications 63 20
Credit guarantees 30 30 27 27 22
Contingent Repurchase Commitments The repurchase price specified in contingent repurchase
commitments is generally lower than the expected fair value at the specified repurchase date. Estimated
proceeds from collateral/recourse in the table above represent the lower of the contracted repurchase
price or the expected fair value of each aircraft at the specified repurchase date.
Indemnifications to ULA In 2006, we agreed to indemnify ULA through December 31, 2020 against
potential non-recoverability and non-allowability of $1,360 of Boeing Delta launch program inventory
included in contributed assets plus $1,860 of inventory subject to an inventory supply agreement which
ends on March 31, 2021. Since inception, ULA has consumed $1,253 of the $1,360 of inventory that was
contributed by us and has yet to consume $107. Under the inventory supply agreement, we have recorded
revenues and cost of sales of $1,367 through December 31, 2015. ULA has made payments of $1,740 to
us under the inventory supply agreement and we have made $71 of indemnification payments to ULA.
We agreed to indemnify ULA against potential losses that ULA may incur in the event ULA is unable to
obtain certain additional contract pricing from the USAF for four satellite missions. We believe ULA is
entitled to additional contract pricing. In December 2008, ULA submitted a claim to the USAF to re-price
the contract value for two satellite missions. In March 2009, the USAF issued a denial of that claim. In
June 2009, ULA filed a notice of appeal, and in October 2009, ULA filed a complaint before the Armed
Services Board of Contract Appeals (ASBCA) for a contract adjustment for the price of the two satellite
missions. In September 2009, the USAF exercised its option for a third satellite mission. During the third
quarter of 2010, ULA submitted a claim to the USAF to re-price the contract value of the third mission. The
USAF did not exercise an option for a fourth mission prior to the expiration of the contract. In March 2011,
ULA filed a notice of appeal before the ASBCA, seeking to re-price the third mission. On November 20,
2013, the ASBCA denied USAF motions for summary judgment against ULA in large part, leaving ULA’s
claims against the USAF substantially intact. The hearing before the ASBCA concluded on December 20,
2013. The parties filed their final post-hearing briefs in May 2014. The ASBCA may now issue a decision
at any time. If ULA is ultimately unsuccessful in obtaining additional pricing, we may be responsible for an