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A-12 DEFERMENT AGREEMENT REVIEW TO BE COMPLETED DEC. 15

 ST. LOUIS, Dec. 1 ~PRNewswire~ -- McDonnell Douglas (NYSE: MD) today announced that McDonnell Douglas and General Dynamics (NYSE: GD) have agreed the U.S. Navy may have until Dec. 15 to complete its 1992 review of the A-12 deferment agreement presently in effect between the two contractors and the Navy.
 The Navy informed the contractors that the timing of the review did not have any adverse implications for its outcome.
 In the deferment agreement, the U.S. Government agreed to defer repayment of $1.352 billion alleged to be due, with interest from Jan. 7, 1991, from both contractors as a result of the termination for default of the A-12 program.
 The deferment agreement provides that it will remain in force until the litigation over the A-12 termination is resolved, subject to a review by the U.S. Government on Dec. 1, 1992, and annually thereafter to determine if there has been a substantial change in the financial condition of either contractor such that deferment is no longer in the best interest of the U.S. Government.
 McDonnell Douglas believes it is entitled to a continuation of the deferment agreement, and that the deferment will continue. However, if the agreement is not continued, McDonnell Douglas intends to contest any collection efforts.
 -0- 12~1~92
 ~CONTACT: Barbara Anderson of McDonnell Douglas Corp., 314-233-2865~
 (MD GD)


CO: McDonnell Douglas Corp.; General Dynamics ST: Missouri IN: ARO SU:

EH -- LA017 -- 2273 12~01~92 09:06 EST
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Publication:PR Newswire
Date:Nov 30, 1992
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