EXHIBIT 99.1
GENRAD CHOICE INVESTMENT PLAN
Financial Statements as of and for the
years ended December 31, 2000 and 1999
Additional Information Required for Form 5500
for the year ended December 31, 2000
GENRAD CHOICE INVESTMENT PLAN
Table of Contents
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PAGE NUMBER
Report of Independent Accountants 1
Basic Financial Statements
Statements of Net Assets Available for Benefits 2
Statements of Changes in Net Assets Available for Benefits 3
Notes to Financial Statements 4-6
Additional Information*
Schedule I - Schedule of Assets (Held at End of Year) 7
* Other supplemental schedules required by Section 2520.103-10 of the Department
of Labor Rules and Regulations for Reporting and Disclosure under ERISA have
been omitted because they are not applicable.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Participants and Administrator of
GenRad Choice Investment Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statements of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of GenRad Choice Investment Plan (the "Plan") at December 31, 2000 and December
31, 1999, 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. 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 of these
statements in accordance with auditing standards generally accepted in the
United States of America, which require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit 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, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets (held
at end of year) is presented for the purpose of additional analysis and is not a
required part of the basic financial statements but is supplementary information
required by the Department of Labor's Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act of 1974. This
supplemental schedule is the responsibility of the Plan's management. The
supplemental schedule has been subjected to the auditing procedures applied in
the audits of the basic financial statements and, in our opinion, is fairly
stated in all material respects in relation to the basic financial statements
taken as a whole.
June 8, 2001
GENRAD CHOICE INVESTMENT PLAN
Statements of Net Assets Available for Benefits
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As of December 31,
2000 1999
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Investments, at fair value
Registered investment companies:
Vanguard International Growth Fund $ 2,107,508 $ 1,389,109
Vanguard LifeStrategy Conservative Growth Fund 454,415 124,846
Vanguard LifeStrategy Growth Fund * 4,119,349 * 3,277,400
Vanguard LifeStrategy Income Fund 123,471 65,802
Vanguard LifeStrategy Moderate Growth Fund 1,952,242 1,426,038
Vanguard Prime Money Market Fund * 10,298,237 * 8,961,617
Vanguard PRIMECAP Fund * 13,480,531 * 8,354,552
Vanguard Total Bond Market Index Fund 2,681,620 2,483,889
Vanguard Wellington Fund * 12,340,557 * 12,698,229
Vanguard Windsor II Fund * 15,349,756 * 15,647,508
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62,907,686 54,428,990
GenRad Common Stock Fund 2,492,122 * 3,753,174
Participant Loans 1,077,955 959,530
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Net assets available for benefits $ 66,477,763 $ 59,141,694
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* Represents 5% or more of net assets available for benefits.
The accompanying notes are an integral part of the financial statements.
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GENRAD CHOICE INVESTMENT PLAN
Statements of Changes in Net Assets Available for Benefits
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Year Ended December 31,
2000 1999
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Additions
Investment income:
Interest and dividend income, investments $ 4,050,793 $ 4,353,499
Interest income, participant loans 75,292 61,470
Net depreciation in fair value of investments (1,560,058) (1,270,638)
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2,566,027 3,144,331
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Contributions:
Employer 1,921,353 1,769,581
Participant 5,293,589 3,868,845
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7,214,942 5,638,426
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Asset transfers in 3,394,948 -
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Total additions 13,175,917 8,782,757
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Deductions
Payment of benefits 5,816,076 6,362,685
Administrative expenses 23,772 33,027
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Total deductions 5,839,848 6,395,712
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Net increase 7,336,069 2,387,045
Net assets available for plan benefits:
Beginning of period 59,141,694 56,754,649
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End of period $ 66,477,763 $ 59,141,694
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The accompanying notes are an integral part of the financial statements.
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GENRAD CHOICE INVESTMENT PLAN
Notes to Financial Statements
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NOTE 1 - DESCRIPTION OF PLAN
The following description of the GenRad Choice Investment Plan (the "Plan")
provides only general information. Participants should refer to the Plan
Agreement for a more complete description of the Plan's provisions.
General
The Plan is a defined contribution plan covering all full-time employees of
GenRad, Inc. (the "Company") who have at least one month of service with the
Company or any of its subsidiaries. The Plan was established on December 31,
1943 and has been amended from time to time. It is subject to the provisions of
the Employee Retirement Income Security Act of 1974 ("ERISA"). The Plan is
administered by an administrative committee appointed by the Company.
As a result of acquisitions by the Company, the SRT Savings, Profit-Sharing and
Retirement Plan and the Nicolet Instrument Corporation Retirement Savings Plan
were merged with and into the Plan effective March 24, 2000.
Contributions
Participants may contribute up to 15% of their annual compensation to the extent
that the contributions comply with Internal Revenue Code ("IRC") limitations.
These contributions are not subject to federal income taxes until withdrawn, in
accordance with Section 401(k) of the IRC. The Company matches 50% of employee
contributions, up to a maximum of 10% of compensation paid. Prior to this date,
the Company matched 50% of employee contributions, up to a maximum of 6% of
compensation paid. The Plan also includes a profit-sharing component, whereby
the Company may make a contribution from its consolidated current or accumulated
earnings in an amount determined by the Board of Directors on or before the last
day of the Company's fiscal year. No profit-sharing contributions were made
during 2000 or 1999.
Participant Accounts
A separate account is maintained for each investment option of a participant by
type of contribution. Each participant's account is credited with the
participant's contribution and allocations of (a) the Company's contributions
and, (b) Plan earnings, and charged with an allocation of administrative
expenses. Plan earnings are allocated and credited to the account daily based on
the adjusted balance of each participant's account. The benefit to which a
participant is entitled is the benefit that can be provided from the
participant's vested account. Administrative expenses are charged to each
participant's account on a quarterly basis totaling $20 annually.
Vesting
Participants who were employees of the Company on or prior to December 31, 1995
are fully vested in all Company and employee voluntary contributions plus actual
earnings thereon upon entering the Plan. Participants who became employees
subsequent to December 31, 1995 are fully vested in all employee contributions
and earnings thereon upon entering the Plan. Company contributions and related
earnings for these participants, however, vest at a rate of 25% per year of
service.
Participant Loans
Participants may borrow from their fund accounts a minimum of $500 up to a
maximum equal to the lesser of $50,000 or 50% of their account balance. Loan
terms can be no longer than five years or up to fifteen years for the purchase
of a primary residence. The loans are collateralized by the balance in the
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GENRAD CHOICE INVESTMENT PLAN
Notes to Financial Statements
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participant's account and bear interest at a rate commensurate with the prime
rate plus 1% at the date the loan is issued. Interest rates for participant
loans outstanding at December 31, 2000 ranged from 6.00% to 9.75% percent.
Principal and interest is paid ratably through monthly payroll deductions.
Payment of Benefits
In case of a normal retirement, retirement due to permanent disability or
termination of employment, participants may elect to receive the value of their
vested account balance in a lump sum, in accordance with the provisions of the
Plan. In the event that a participant dies before retirement, the beneficiary
will receive the value of the participant's vested account balance in a lump-sum
distribution, less the value of outstanding loans made to the participant.
Participants qualifying for a hardship withdrawal may receive all or a portion
of their contributions, plus investment return earned thereon, but not more than
the amount necessary to meet the financial hardship.
Forfeited Accounts
At December 31, 2000, forfeited nonvested accounts totaled $301,753. These
accounts will be used to reduce future employer contributions. In 2000, employer
contributions were not reduced by any amounts from forfeited nonvested accounts.
Plan Termination
Although it has not expressed any intent to do so, the Company has the right
under the Plan to discontinue its contributions at any time and to terminate the
Plan subject to the provisions of ERISA. In the event of Plan termination,
participants will become 100% vested in their accounts.
NOTE 2 - SUMMARY OF ACCOUNTING POLICIES
The following accounting policies, which conform to accounting principles
generally accepted in the United States of America, have been used consistently
in the preparation of the Plan's financial statements:
Basis of Accounting
The financial statements of the Plan are prepared under the accrual method of
accounting.
Use of Estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of additions and deductions
during the reporting period. Actual results could differ from those estimates.
Investment Valuation and Income Recognition
The Plan's investments are stated at fair value. Shares of registered investment
companies are valued at quoted market prices, which represent the net asset
value of shares held by the Plan at year-end. The Company stock fund is valued
at its year-end unit closing price (comprised of common stock at year-end market
price plus uninvested cash position). Participant loans are valued at cost which
approximates fair value.
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GENRAD CHOICE INVESTMENT PLAN
Notes to Financial Statements
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Purchases and sales of investments are recorded on a trade-date basis. Interest
income is accrued when earned. Dividend income is recorded on the ex-dividend
date. Capital gain distributions are included in dividend income.
Payment of Benefits
Benefits are recorded when paid.
NOTE 3 - RELATED PARTY TRANSACTIONS
The Plan invests in shares of mutual funds managed by an affiliate of Vanguard
Fiduciary Trust Company ("VFTC"). VFTC acts as trustee for Plan investments.
Transactions in such investments qualify as party-in-interest transactions and
are exempt from the prohibited transaction rules. During the year, the Plan had
purchases of $771,812 and sales of $757,599 of Company stock.
NOTE 4 - PLAN EXPENSES
The Company pays a portion of the expenses for services necessary for the
administration of the Plan.
NOTE 5 - INVESTMENTS
During 2000 and 1999, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year) appreciated
(depreciated) in value as follows:
2000 1999
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Registered investment companies $ (284,793) $ (1,310,601)
Common Stock (1,275,265) 39,963
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$ (1,560,058) $ (1,270,638)
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NOTE 6 - TAX STATUS
The Internal Revenue Service has determined and informed the Company by a letter
dated July 3, 1995, that the plan and related trust are designed in accordance
with applicable sections of the IRC. The Plan has been amended since receiving
the determination letter. However, Plan's management believes that the Plan is
designed and is currently being operated in compliance with the applicable
requirements of the IRC.
NOTE 7 - SUBSEQUENT EVENT
On April 23, 2001, the Company sold its North American Test Technology
Associates division, resulting in distributions of approximately $1,000,000.
ADDITIONAL INFORMATION
REQUIRED FOR FORM 5500
GENRAD CHOICE INVESTMENT PLAN Schedule I
Schedule of Assets (Held at End of Year)
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GenRad Choice Investment Plan, EIN 04-1360950
Attachment to Form 5500, Schedule H, Part IV, Line i:
Identity of Issue Investment Type Current Value
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* Vanguard International Growth Fund Registered Investment Company $ 2,107,508
* Vanguard Life Strategy Conservative Growth Fund Registered Investment Company 454,415
* Vanguard Life Strategy Growth Fund Registered Investment Company 4,119,349
* Vanguard LifeStrategy Income Fund Registered Investment Company 123,471
* Vanguard LifeStrategy Moderate Growth Fund Registered Investment Company 1,952,242
* Vanguard Prime Money Market Fund Registered Investment Company 10,298,237
* Vanguard PRIMECAP Fund Registered Investment Company 13,480,531
* Vanguard Total Bond Market Index Fund Registered Investment Company 2,681,620
* Vanguard Wellington Fund Registered Investment Company 12,340,557
* Vanguard Windsor II Fund Registered Investment Company 15,349,756
* GenRad, Inc. Common Stock 2,492,122
GenRad Choice Investment Plan Participant Loans (6.00% - 9.75%) 1,077,955
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Total assets $ 66,477,763
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* Party in Interest
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