Benefits
Administrative Committee
BE
Aerospace, Inc. 1994
Employee
Stock Purchase Plan
Wellington,
Florida
We have
audited the accompanying statements of net assets available for benefits of BE
Aerospace, Inc. 1994 Employee Stock Purchase Plan (the “Plan”) as
of December 31, 2007 and 2006, and the related statements of changes in net
assets available for benefits for the years then ended. These financial
statements are the responsibility of the Plan’s management. Our responsibility
is to express an opinion on these financial statements based on our
audits.
We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. The Plan is not required
to have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audits included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Plan’s internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our
opinion, such financial statements present fairly, in all material respects, the
net assets available for benefits of the Plan as of December 31, 2007 and 2006,
and the changes in net assets available for benefits for the years then ended,
in conformity with accounting principles generally accepted in the
United States of America.
/s/Deloitte & Touche LLP
Costa
Mesa, California
June 27,
2008
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BE
AEROSPACE, INC.
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1994
EMPLOYEE STOCK PURCHASE PLAN
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STATEMENTS
OF NET ASSETS AVAILABLE FOR BENEFITS
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DECEMBER
31, 2007 AND 2006
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2007
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2006
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ASSETS
— Cash and cash equivalents
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$
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1,332,816
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$
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1,078,385
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LIABILITIES
— Stock subscribed
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(1,321,926
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(1,073,763
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NET
ASSETS AVAILABLE FOR BENEFITS
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$
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10,890
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$
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4,622
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See
report of independent registered public accounting firm and notes to financial
statements.
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BE
AEROSPACE, INC.
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1994
EMPLOYEE STOCK PURCHASE PLAN
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STATEMENTS
OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
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YEARS
ENDED DECEMBER 31, 2007 AND 2006
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2007
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2006
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NET
ASSETS AVAILABLE FOR BENEFITS — Beginning
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of
period
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$
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4,622
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$
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3,947
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ADDITIONS
TO NET ASSETS ATTRIBUTED
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TO
— Participant payroll deductions
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2,632,555
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2,248,381
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DEDUCTIONS
FROM NET ASSETS ATTRIBUTED
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TO
— Purchase of BE Aerospace, Inc. common stock
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(2,626,287
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(2,247,706
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NET
ASSETS AVAILABLE FOR BENEFITS — End
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of
period
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$
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10,890
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$
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4,622
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See
report of independent registered public accounting firm and notes to financial
statements.
BE
AEROSPACE, INC.
1994
EMPLOYEE STOCK PURCHASE PLAN
NOTES
TO FINANCIAL STATEMENTS
YEARS
ENDED DECEMBER 31, 2007 AND 2006
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1.
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GENERAL
AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
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Description of Plan
—
Effective August 11, 1994, BE Aerospace, Inc. (the “Company”)
adopted the BE Aerospace, Inc. 1994 Employee Stock Purchase Plan
(the “Plan”), as amended and restated on January 1, 2006. The
following description of the Plan is provided for general information purposes
only. Participants should refer to the Plan Agreement for complete
information.
The
Company is the Plan sponsor. All employees (participants) with a minimum of
90 days service, who generally complete a minimum of 20 hours of
service per week, are eligible to participate. Under the Plan, participants may
choose to contribute from 2% to 15% of their total gross
pay.
Common
stock of the Company is purchased twice each year in six-month increments
beginning January 1 and ending June 30 and beginning July 1 and ending December
31. The purchase price is equal to 85% of the fair value on the last
day of each option period. Participants are allocated a pro rata share of stock
consistent with the balance of the participant’s account. The stock is then
issued by the Plan transfer agent, Computershare, directly to the participant.
The maximum number of shares available for each option period to an individual
is the largest whole number of shares which, when multiplied by the fair market
value of the Company stock at the beginning of the option period, produces a
dollar amount of $12,500 or less.
Stock Subscribed
— The Plan
issues the stock to participants subsequent to the end of each option period but
dated the last day of the option period. Therefore, a liability for stock
purchased by the Plan but not yet distributed to the participants has been
reflected as stock subscribed in the accompanying statements of net assets
available for benefits as of December 31, 2007 and 2006. The Company stock
is valued at 85% of its closing quoted market price.
Stock
purchased by the Plan for distribution to the participants for the years ended
December 31, 2007 and 2006, was 66,555 and 109,608 shares, respectively. Amounts
representing fractional shares due to employees are carried forward to the
following distribution period.
Termination Benefits and
Vesting
— Upon termination of employment with the Company, a
participant’s participation in the Plan will cease immediately and the
participant is entitled to receive all contributions not yet used to acquire
common stock of the Company. Upon a participant’s death, his or her beneficiary
can elect to have all contributions used to acquire stock at the end of the
option period.
Cash and Cash Equivalents
—
Cash and cash equivalents consist of highly liquid investments purchased with
original maturities of 90 days or less. The Plan’s cash and cash
equivalents are held in accounts owned by the Company and may not be fully
insured by the Federal Deposit Insurance Corporation.
Income Tax
— The Plan
administrator believes that the Plan is currently designed and being operated in
compliance with the applicable requirements of the Internal Revenue Code of
1986 and is, therefore, not subject to income taxes. Plan assets consist of cash
not yet used to purchase common stock. Such cash remains an asset of the Company
until each semiannual purchase date when the cash is used to sell shares to the
employees.
Administrative Expenses
—
Administrative expenses have been paid directly by the Company and, accordingly,
are not reflected in the Plan’s financial statements. There is no written
agreement requiring the Company to pay these expenses, and the Company may elect
to stop paying Plan expenses at any time.
The Plan
will automatically terminate on December 31, 2013. The Plan may be earlier
suspended or terminated by the Board of Directors. In the event of Plan
termination, any unused contributions will be returned to the
participants.
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