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Exhibit 99.2
[LOGO]
RETIREMENT AND SAVINGS PLAN OF
LOCTITE PUERTO RICO, INC.
(SAVINGS PLAN FUND ONLY)
FINANCIAL STATEMENTS AND
ADDITIONAL INFORMATION
JUNE 30, 1994 AND 1993
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RETIREMENT AND SAVINGS PLAN OF
LOCTITE PUERTO RICO, INC.
(SAVINGS PLAN FUND ONLY)
TABLE OF CONTENTS TO FINANCIAL STATEMENTS AND
ADDITIONAL INFORMATION
Page
----
Financial Statements:
Report of Independent Accountants ..................... 8
Statement of Net Assets Available for
Benefits with Fund Information ....................... 9
Statement of Changes in Net Assets Available
for Benefits with Fund Information ................... 10
Notes to Financial Statements ......................... 11-16
Additional Information: *
Schedule I - Schedule of Assets Held for Investment
Purposes ............................................ 17
Schedule 11 - Schedule of Reportable Transactions ..... 18
* Other 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.
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[PRICE WATERHOUSE LETTERHEAD]
REPORT OF INDEPENDENT ACCOUNTANTS
October 3, 1994
To the Participants and Administrator
of the Retirement and Savings Plan of
Loctite Puerto Rico, Inc. (Savings Plan Fund Only)
In our opinion, the financial statements of Net Assets Available for Benefits
and the related statement of Changes in Net Assets Available for Benefits
present fairly, in all material respects, the net assets available for benefits
of the Retirement and Savings Plan of Loctite Puerto Rico, Inc. (Savings Plan
Fund Only) at June 30, 1994 and 1993, and the changes in net assets available
for benefits for the years then ended, in conformity with generally accepted
accounting principles. 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 generally accepted auditing standards 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 the opinion expressed above.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The additional information included in
Schedules I and II is presented for the purposes 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. The fund information in the Statement of Net Assets and the Statement of
Changes in Net Assets Available for Benefits is presented for purposes of
additional analysis rather than to present the net assets available for plan
benefits and changes in net assets available from plan benefits of each fund.
The supplemental schedules and fund information have been subjected to the
auditing procedures applied in the audit of the basic financial statements and,
in our opinion, are fairly stated in all material respects in relation to the
basic financial statements taken as a whole.
/s/ PRICE WATERHOUSE
- ------------------------------------------
CERTIFIED PUBLIC ACCOUNTANTS
(OF PUERTO RICO)
License No. 10 Expires Dec. 1, 1995
Stamp 1 2 4 9 3 2 0 of the P.R. Society of
Certified Public Accountants has been
affixed to the file copy of this report
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RETIREMENT AND SAVINGS PLAN OF
LOCTITE PUERTO RICO, INC.
(SAVINGS PLAN FUND ONLY)
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS (WITH FUND INFORMATION)
June 30, 1994 June 30, 1993
------------- -------------
Company Fixed Diversified Company Fixed Diversified
Stock Income Equity Stock Income Equity
Fund Fund Fund Total Fund Fund Fund Total
-------- -------- -------- ---------- -------- -------- -------- ----------
ASSETS
Investment, at fair value:
Loctite Corporation common
stock $642,519 $ 642,519 $473,905 $ 473,905
Fixed income funds $ 8,292 8,292
Diversified equity funds $189,546 189,546 $ 94,859 94,859
-------- -------- -------- ---------- -------- -------- ----------
642,519 8,292 189,546 840,357 473,905 94,859 568,764
Guaranted investment contract, at
contract value 645,250 645,250 $525,853 525,853
-------- -------- -------- ---------- -------- -------- -------- ----------
642,519 653,542 189,546 1,485,607 473,905 525,853 94,859 1,094,617
-------- -------- -------- ---------- -------- -------- -------- ----------
Receivables:
Employer's contribution 5,584 5,584
Participants' contribution 2,035 7,980 3,111 13,126
Accrued interest and dividends 2,988 3,281 6,269 2,433 2,912 327 5,672
-------- -------- -------- ---------- -------- -------- -------- ----------
2,988 3,281 6,269 10,052 10,892 3,438 24,382
-------- -------- -------- ---------- -------- -------- -------- ----------
Cash 11 6 7 24 (58) 3 5 (50)
-------- -------- -------- ---------- -------- -------- -------- ----------
Net assets available for benefits $645,518 $656,829 $189,553 $1,491,900 $483,899 $536,748 $98,302 $1,118,949
======== ======== ======== ========== ======== ======== ======= ==========
The accompanying notes are an integral part of this statement.
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RETIREMENT AND SAVINGS PLAN OF
LOCTITE PUERTO RICO, INC.
(SAVINGS PLAN FUND ONLY)
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS (WITH FUND
INFORMATION)
June 30, 1994 June 30, 1993
------------- -------------
Company Fixed Diversified Company Fixed Diversified
Stock Income Equity Stock Income Equity
Fund Fund Fund Total Fund Fund Fund Total
-------- -------- -------- ---------- -------- -------- ------- ----------
Additions to net assets
attributed to:
Interest $ 73 $ 38,097 $ 40 $ 38,210 $ 59 $ 30,867 $ 13 $ 30,939
Dividends 11,120 3,144 14,164 8,732 2,314 11,046
Net appreciation (depreciation)
in fair market value of
investments 43,656 5,471 49,127 (39,652) 11,311 (28,341)
-------- -------- -------- ---------- -------- -------- ------- ----------
54,849 38,097 8,655 101,601 (30,861) 30,867 13,638 13,644
-------- -------- -------- ---------- -------- -------- ------- ----------
Contributions:
Participants 40,824 113,705 88,417 242,946 30,875 129,079 31,998 191,952
Employer 99,892 99,892 83,610 83,610
Other (539) 5,191 1,355 6,007
-------- -------- -------- ---------- -------- -------- ------- ----------
140,716 113,705 88,417 342,838 113,946 134,270 33,353 281,569
-------- -------- -------- ---------- -------- -------- ------- ----------
Total additions 195,565 151,802 97,072 444,439 83,085 165,137 46,991 295,213
-------- -------- -------- ---------- -------- -------- ------- ----------
Deductions from net
assets attributable to
distribution to participants (33,946) (31,721) (5,821) (71,488) (28,517) (26,056) (3,954) (58,527)
-------- -------- -------- ---------- -------- -------- ------- ----------
Net increase 161,619 120,081 91,251 372,951 54,568 139,081 43,037 236,686
Net assets at beginning of year 483,899 536,748 98,302 1,118,949 429,331 397,667 55,265 882,263
-------- -------- -------- ---------- -------- -------- ------- ----------
Net assets at end of year $645,518 $656,829 $189,553 $1,491,900 $483,899 $536,748 $98,302 $1,118,949
======== ======== ======== ========== ======== ======== ======= ==========
The accompanying notes are an integral part of this statement.
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RETIREMENT AND SAVINGS PLAN OF
LOCTITE PUERTO RICO, INC.
(SAVINGS PLAN FUND ONLY)
NOTES TO THE FINANCIAL STATEMENTS
NOTE 1 - REPORTING ENTITY:
Retirement and Savings Plan of Loctite Puerto Rico, Inc. (Savings Plan Fund
Only) (the "Plan") was established on July 1, 1989. It is administered by a
Savings Plan Committee appointed by the Committee on Human Resources of the
Company's Board of Directors of Loctite Puerto Rico, Inc. (the Company). The
purpose of the Plan is to encourage and provide a convenient way for the
employees of Loctite Puerto Rico, Inc. to save on a regular and long-term
basis, to provide additional retirement benefits, and to encourage such
employees to make and continue careers with the Company.
NOTE 2 - DESCRIPTION OF THE PLAN:
The following description of 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 employees of the Company
who have one year of service (with at least 1,000 hours of service) and are age
twenty one or older. It is subject to the provisions of the Employee Retirement
Income Security Act of 1974 ("ERISA").
Contributions
Participants may contribute up to 16% of their annual compensation. The
Company makes a contribution equivalent to 50% of the first 6% of each
participant's contributions. The company's contribution however is all directed
to the Loctite's common stock fund. The participants' and Company's
contributions are remitted monthly to the Trustee.
Investments Options:
The participants' contributions must be invested, as selected by the
participants, in any one or more of the following funds covered by the Plan:
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Company stock fund - Funds are invested solely in Loctite
Corporation's common stock. Participants' contributions to the
Company's stock fund are limited to a maximum of 25% of their
contributions.
Fixed income fund - Funds are invested in guaranteed investment
contracts ("GIC") with Metropolitan Life Insurance Company and CNA
Insurance Companies and New York Life Insurance Company. These
contract are designed to produce a fixed rate of return.
Diversified Equity fund - Participants' contributions to the
diversified equity fund are invested in the Fidelity Advisor Equity
Portfolio fund.
Participating Employees
There were 140 participating employees in the Plan as of June 30, 1994 and 121
as of June 30, 1993.
Vesting
Participants are fully vested at all times in their contributions and the
investment experience associated therewith. Participants become fully vested
in the Company's contributions and the investment experience associated
therewith when they complete five years of service with the Company. In the
event of the participant's death, disability, or retirement, all amounts in the
participant's account become fully vested.
NOTE 3- SUMMARY OF ACCOUNTING POLICIES:
Method of Accounting
The Plan's financial statements are prepared on the accrual basis of
accounting.
Investments
Plan investments, other than the GIC's, are stated at fair value. The Company
stock is valued at its quoted market price. Mutual fund investments are valued
at fair value, representing the value at which shares of the fund may be
purchased or redeemed.
Payment of Benefits
On termination of service, a participant shall receive a lump-sum amount equal
to the value of his or her account. Active participants may also elect hardship
and in service withdrawals in accordance with plan provisions.
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NOTE 4 - BENEFIT OBLIGATION:
At June 30, 1993 benefit obligations for persons who had withdrawn from
participation in the Plan's Guaranteed Income Fund was $2,698.
NOTE 5 - INVESTMENTS:
The Plan's investments are held in trust by Fleet Bank, National Association
Trustee (the "Trustee") under the terms of a Trust Agreement. The following
table presents the fair values of those investments that represent 5 percent or
more of the Plan's net assets.
June 30,
--------
1994 1993
---- ----
Investments at Fair Value as
Determined by Quoted Market Price:
Company stock fund -
Loctite Corporation Common Stock -
14,942 and 12,074 shares $ 631,300 $ 473,905
---------- ----------
Investments at Fair Value:
Mutual Funds -
Fidelity Advisory Services III Equity
Portfolio Inc. - 11,876 and 6,542 shares 181,590 94,859
---------- ----------
Investments at Contract Value:
Guaranteed Investment Contracts with:
Metropolitan Life Insurance Company
Contract No. GAC-10334-4, 9.01%,
due 1-3-94 85,941
New York Life Insurance Company
Contract No. GA-06857-2, 5.60%
due 12-31-98 122,412
Metropolitan Life Insurance Company
Contract No. GAC-13342-169, 6.54%,
due 10-23-97 271,212 254,563
CNA Insurance Companies
Contract No. 12862-016
6.6% due 12-31-97 251,626 185,349
---------- ----------
Total investments $1,458,140 $1,094,617
========== ==========
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During June 30, 1994 and 1993, the Plan's investments (including gains and
losses on investments bought and sold during the year) appreciated
(depreciated) in value by $49,127 and ($28,341), respectively, as follows:
Year ended
June 30,
--------
1994 1993
---- ----
Investments at fair value as
determined by quoted market price:
Loctite Corporation Common Stock
Fund $43,656 ($39,652)
Diversified Equity Fund 5,471 11,311
------- --------
Net change in fair value $49,127 ($28,341)
======= ========
The following tables summarize the net gain on sales of stock during 1994 and
1993:
Gain (loss)
Month of Number of on sale
sale shares sold Proceeds Cost of stock
---- ----------- -------- ---- --------
1994:
------
August 269 $ 4,008 $ 3,337 $ 671
August 128 4,730 4,183 547
October 159 5,872 5,417 455
December 91 3,351 3,115 236
February 37 1,395 1,231 164
March 141 5,283 4,705 578
April 254 9,545 8,803 742
April 62 2,330 2,149 181
June 25 1,053 885 168
----- ------- ------- ------
1,166 $37,567 $33,825 $3,742
===== ======= ======= ======
1993:
-----
September 16 $ 672 $ 476 $ 196
October 52 1,071 854 217
November 313 5,394 4,541 853
December 151 6,496 4,631 1,865
February 119 5,479 3,862 1,617
March 15 640 476 164
April 63 2,749 2,112 637
May 100 4,161 3,191 970
June 132 5,079 4,212 867
----- ------- ------- ------
961 $31,741 $24,355 $7,386
===== ======= ======= ======
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ERISA requires the use of the revalued cost method for reporting realized and
unrealized gains and losses on Form 5500. Under this method, realized gains and
losses are calculated as sales proceeds less the current value as of the
beginning of the year (or acquisition cost if acquired during the year).
Unrealized gains and losses are calculated as current value of investments held
at the end of the year less their current value as of the beginning of the year
(or acquisition cost if acquired during the year). Realized and unrealized
gains and losses calculated using the current value method for the year ended
June 30, 1994 and 1993 and the amounts presented in the financial statements
are reconciled as follows:
1994 1993
---- -----
Financial Financial
statements Form 5500 statements Form 5500
---------- --------- ---------- ---------
Net gain (loss) on investments
sold $ 3,742 (1,542) $ 7,386 (25)
Unrealized gain (loss) in fair market
value of investments 45,385 50,669 (35,727) (28,316)
------- ------- -------- -------
Net gain (loss) $49,127 $49,127 ($28,341) $28,341
======= ======= ======== =======
NOTE 6 - GUARANTEED INVESTMENT CONTRACT:
Participants' contributions to the fixed income fund were invested in three
guaranteed investment contracts one with Metropolitan Life Insurance Company
and one CNA Insurance Companies and one with New York Life Insurance Company
which guaranteed return ranging from 5.6% to 6.6%, maturing from October 23,
1997 to December 31, 1998.
NOTE 8 - INCOME TAXES:
The Plan has been qualified as tax exempt by the Puerto Rico Department of
Treasury under the provisions of Section 165(a) of the Puerto Rico Income Tax
Act of 1954, as amended. The Plan also qualifies as tax exempt for federal
income tax purposes under the provisions of Section 1022 (i) of ERISA.
Under present U.S. and Puerto Rico income tax laws and regulations, a
participant is not subject to income taxes on the contributions of the
employing company, or on the interest, dividends or profits on the sale of
securities received by the Trustee until the participant's account is
distributed to the participant.
NOTE 9 - FEES AND EXPENSES:
As indicated in the Plan Agreement, the Trustee's fees and all administrative
expenses incurred in the management of the Plan are paid by the Company.
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NOTE 10 - 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 percent vested in their accounts.
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ADDITIONAL INFORMATION
SCHEDULE I
RETIREMENT AND SAVINGS PLAN OF LOCTITE PUERTO RICO, INC.
(SAVINGS PLAN FUND ONLY)
ITEM 27a FORM 5500 - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
JUNE 30, 1994
Number of shares
or Principal
Identity of Issues amount Cost of assets Current value
------------------ ----------------- -------------- -------------
FIXED INCOME FUND
- -----------------
Metropolitan Life Insurance Co.
Contract No. GAC-10334-4
9.01% Mat. 1/3/94
New York Life Insurance Co.
Contract No. GA-06857-2
5.60% Mat. 12/31/98 122,412 122,412 122,412
Metropolitan Life Insurance Co.
Contract No. GAC-13342-169
6.54% Mat. 10/23/97 271,212 271,212 271,212
CNA Insurance Companies
Contract No. 12862-016
6.6% Mat. 12/31/97 251,626 251,626 251,626
Fleet Short Term Investment Funds 8,292 8,292 8,292
---------- ----------
653,542 653,542
---------- ----------
COMPANY STOCK FUND
- ------------------
Loctite Corporation
Common stock 14,942 508,429 631,300
Fleet Short-Term Investment Funds 11,219 11,219 11,219
---------- ----------
519,648 642,519
---------- ----------
DIVERSIFIED EQUITY FUND
- -----------------------
Fidelity Advisor Equity Portfolio 11,876 161,623 181,590
Fleet Short Term Investment Funds 7,956 7,956 7,956
---------- ----------
169,579 189,546
---------- ----------
Total Investments $1,342,769 $1,485,607
---------- ----------
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ADDITIONAL INFORMATION
SCHEDULE II
RETIREMENT AND SAVINGS PLAN
OF LOCTITE PUERTO RICO, INC.
(SAVINGS PLAN FUND ONLY)
ITEM 27d FORM 5500 - SCHEDULE OF REPORTABLE TRANSACTIONS
YEAR ENDED JUNE 30, 1994
Current value
Description Purchase Selling Cost of on transactions
Party Involved of Asset Price Price Asset date
- -------------- ----------- -------- ------- ------- ---------------
New York
Life Insurance Co. Guaranteed Insurance
Contract $90,379 $90,379 $90,379
Metropolitan Life
Insurance Co. Guarantee Insurance
Contract $90,379 $90,379 $90,379
* Transactions in excess of 5 percent of the current value of Plan's assets as
of June 30, 1994 as defined in Section 2520.103-6 of the Department of Labor
Rules and Regulations for Reporting and Disclosure under ERISA.
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