-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, L7EEMCPGvBUhL6bHgNffi7vsagtBPqaz4/D1mPvYynTDZKi/L1VVcYioIBbmd4nm uxl3hVeQT7FPWcHa2dRDlw== 0000927016-96-000469.txt : 19960629 0000927016-96-000469.hdr.sgml : 19960629 ACCESSION NUMBER: 0000927016-96-000469 CONFORMED SUBMISSION TYPE: 10-K/A PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19951231 FILED AS OF DATE: 19960627 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: BROWN & SHARPE MANUFACTURING CO /DE/ CENTRAL INDEX KEY: 0000014637 STANDARD INDUSTRIAL CLASSIFICATION: METALWORKING MACHINERY & EQUIPMENT [3540] IRS NUMBER: 050113140 STATE OF INCORPORATION: DE FISCAL YEAR END: 1229 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 001-05881 FILM NUMBER: 96586823 BUSINESS ADDRESS: STREET 1: PO BOX 456 STREET 2: PRECISION PK - 200 FRENCHTOWN RD CITY: NORTH KINGSTOWN STATE: RI ZIP: 02852 BUSINESS PHONE: 4018862000 10-K/A 1 FORM 10-K/A COMMISSION FILE NUMBER 1-5881 ----------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K/A AMENDMENT TO APPLICATION OR REPORT FILED PURSUANT TO SECTION 12, 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 BROWN & SHARPE MANUFACTURING COMPANY ------------------------------------ (Exact name of registrant as specified in charter) AMENDMENT NO. 1 The undersigned registrant hereby amends the following items, financial statement, exhibits or other portions of its Annual Report for the year ended December 31, 1995, on Form 10-K as set forth in the pages attached hereto: The Exhibit Index and Exhibits are amended to reflect the addition of the following: "Exhibit 28.1 - Annual Report on Form 11-K for The Brown & Sharpe Savings and Retirement Plan for Management Employees for the year ended December 31, 1995." "Exhibit 28.2 - Annual Report on Form 11-K for The Brown & Sharpe Savings and Retirement Plan for the year ended December 31, 1995." Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this amendment to be signed on its behalf by the undersigned, thereunto duly authorized. Brown & Sharpe Manufacturing Company By: /s/ Alfred J. Corso ------------------------------------- Alfred J. Corso Corporate Controller (Principal Accounting Officer) EX-28.1 2 SAVINGS AND RETIREMENT PLAN FOR MANAGEMENT Exhibit 28.1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 11-K Annual Report Pursuant to Section 15(d) of the Securities Exchange Act of 1934 For the Fiscal Year Ended December 31, 1995 ----------------- Commission File Number 1-5881 ------ THE BROWN & SHARPE SAVINGS AND RETIREMENT PLAN FOR MANAGEMENT EMPLOYEES ----------------------------------------------------------------------- (Full Title of the Plan) BROWN & SHARPE MANUFACTURING COMPANY 200 Frenchtown Road North Kingstown, Rhode Island 02852-1700 (401) 886-2000 (Name of Issuer and Address of its Principal Executive Office) SIGNATURES ---------- Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan has duly caused this Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized, in North Kingstown, Rhode Island, on the 24 day of June, 1996. - -- ---------- BROWN & SHARPE SAVINGS & RETIREMENT PLAN FOR MANAGEMENT EMPLOYEES By: /s/ Alfred J. Corso --------------------------------------- Alfred J. Corso Controller (Principal Accounting Officer) 2 BROWN & SHARPE SAVINGS AND RETIREMENT PLAN FOR MANAGEMENT EMPLOYEES Table of Contents Page ----- Report of Ernst & Young LLP, Independent Auditors 4 Financial Statements: Statements of Net Assets Available for Plan Benefits at December 31, 1995 and 1994 5 Statements of Changes in Net Assets Available for Plan Benefits for the Years Ended December 31, 1995 and 1994 5 Notes to Financial Statements 6-13 Supplemental Schedules: Schedule of Reportable Transactions 14 Schedule of Assets Held for Investment Purposes at December 31, 1995 15-19 Consent of Independent Auditors 20 3 REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS ------------------------------------------------- Brown & Sharpe Savings and Retirement Plan for Management Employees Committee Brown & Sharpe Manufacturing Company We have audited the accompanying statements of net assets available for plan benefits of the Brown & Sharpe Savings and Retirement Plan for Management Employees (the Plan) as of December 31, 1995 and 1994, and the related statements of changes in net assets available for plan 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 generally accepted auditing standards. Those standards 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. An audit also includes 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, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan at December 31, 1995 and 1994, and the changes in its net assets available for benefits for the years then ended, in conformity with generally accepted accounting principles. Our audit was made for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedules of assets held for investment purposes as of December 31, 1995, and reportable transactions for the year then ended, are presented for purposes of complying with the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974, and are not a required part of the financial statements. The supplemental schedules have been subjected to the auditing procedures applied in our audits of the financial statements and, in our opinion, are fairly stated in all material respects in relation to the financial statements taken as a whole. ERNST & YOUNG LLP June 24, 1996 4 THE BROWN & SHARPE SAVINGS & RETIREMENT PLAN FOR MANAGEMENT EMPLOYEES --------------------------------------------------------------------- STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS ----------------------------------------------------
As of December 31, ------------------------------- 1995 1994 ------------- ------------- Assets: Investments (Notes 2 and 5) $21,861,765 $18,115,193 Dividends and interest receivable 86,842 72,413 Employer contribution receivable 759,023 618,050 Plan loans receivable 260,451 257,669 ----------- ----------- Net Assets Available for Plan Benefits $22,968,081 $19,063,325 =========== ===========
STATEMENTS OF INCOME AND CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS --------------------------------------------------------------------------
For the years ended December 31, ---------------------------------- 1995 1994 ---------------- ---------------- Additions - --------- Contributions: Employer $ 788,389 $ 641,425 Employee 1,195,789 892,263 ----------- ----------- 1,984,178 1,533,688 Investment income: Interest 744,736 723,338 Dividends 36,276 93,572 ----------- ----------- 781,012 816,910 Net appreciation (depreciation) in fair value of investments 2,815,217 (255,446) ----------- ----------- Total additions 5,580,407 2,095,152 Deductions - ---------- Payments to participants (1,720,895) (3,678,814) Loan defaults - (2,490) Fees (12,402) (38,014) ----------- ----------- Total deductions (1,733,297) (3,719,318) Transfers - --------- From Brown & Sharpe Employee Stock Owner- ship & Profit Participation Plan 11,383 24,994 (ESOP) From (To) Brown & Sharpe Savings & Retirement Plan (SARP) 46,263 (2,726) ----------- ----------- Net transfers 57,646 22,268 ----------- ----------- Net increase (decrease) in assets 3,904,756 (1,601,898) Net assets, beginning of year 19,063,325 20,665,223 ----------- ----------- Net assets, end of year $22,968,081 $19,063,325 =========== ===========
See notes to the financial statements. 5 THE BROWN & SHARPE SAVINGS & RETIREMENT PLAN FOR MANAGEMENT EMPLOYEES --------------------------------------------------------------------- NOTES TO FINANCIAL STATEMENTS ----------------------------- 1. PLAN DESCRIPTION ---------------- The following description of The Brown & Sharpe Savings and Retirement Plan for Management Employees (the "Plan") provides only general information. Participants should refer to the Summary Plan Description for more complete details. GENERAL ------- The Plan is a defined contribution plan covering all eligible full-time salaried employees of Brown & Sharpe Manufacturing Company (the "Company") and its affiliated companies who participate in the Plan. Such employees are immediately eligible to make deferred salary contributions to the Plan. One year of service is required to become a participant receiving Company contributions. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA), as amended. As a result of the Company's acquisition of DEA S.p.A. on September 28, 1994, participants of the Digital Electronic Automation, Inc. Tax-Deferred Savings Plan (the DEA Plan) became eligible to participate in the Plan on April 1, 1995. Pursuant to the terms of the DEA Plan, former DEA employees may select an annuity as a distribution option under the Plan. In May 1996, approximately $1,947,740 of net assets were transferred from the DEA Plan to the Plan. CONTRIBUTIONS ------------- The Plan permits a participant to make deferred salary contributions to the Plan equal to 2% to 16% of compensation up to a maximum of $9,240 in 1995 and in 1994, (indexed in future years) which is not subject to federal income tax until distributed. Contributions are invested at the direction of the employee in one or more investment alternatives, or "Funds," as described below. The Company may, at the discretion of the Board of Directors, make a supplemental contribution of 4% of annual compensation plus 4% of the amount over the Social Security wage base to the account of each participant to be invested as instructed by the participant. The Company's supplemental contributions for 1995 and 1994 were $759,023 and $618,050, respectively. In addition, the Plan provides for a Company contribution, or subsidy, equal to one-quarter of the amount of each deferred salary contribution invested directly in the Company Stock Fund. Such Company contributions for 1995 and 1994 were $29,366 and $23,375, respectively. PARTICIPANT ACCOUNTS -------------------- A separate account is established for each participant when enrolled in the Plan. Each participant's account is credited with participant salary deferrals, Company contributions, and an allocation of earnings of the Funds in which such participant's account is invested. Allocations, as determined by a monthly valuation, are credited ratably among all participants in each Fund. 6 NOTES TO FINANCIAL STATEMENTS (CONTINUED) ----------------------------------------- INVESTMENTS ----------- Participants direct the trustee to put contributions in one or more of the following investment alternatives in multiples of 10%: (1) the Diversified Fund, managed by Frontier Capital Management, Inc., consisting primarily of a diversified portfolio of stock and fixed income securities; (2) the Company Stock Fund, managed by Fleet National Bank, consisting primarily of Company common stock; (3) the Money Market Fund, invested by Fleet National Bank through Fidelity Management & Research Company consisting primarily of obligations of the U.S. Government or its agencies, banks and business corporations (other than the Company); or (4) the Guaranteed Interest Fund, consisting primarily of guaranteed investment contracts issued by American International Life Assurance Company of New York in 1994, Principal Mutual Life Insurance Company in 1992 and 1993, and Allstate Life Insurance Company in 1991. These guaranteed investment contracts are agreements under which the issuer has agreed to pay the investor a guaranteed rate of interest over terms ranging from 3 to 5 years. The contracts automatically terminate at maturity date. A penalty is imposed upon early termination of contract. The issuers of these contracts are insurance companies, and because of this, the contracts are more susceptible to factors adversely affecting the insurance industry than similar contracts issued by parties other than insurance companies. Transfers between investment funds can be made subject to certain rules. The Plan assets and those of the Brown & Sharpe Savings and Retirement Plan are held in a trust administered by Fleet National Bank as Trustee. The assets and activity within this trust are allocated between the two plans based on the underlying participant records of each plan. In years when Company contributions are made, forfeitures are used first to reduce Company contributions and then to pay Plan expenses. In 1995 and 1994, Plan expenses were paid entirely by the Company. BENEFITS -------- A participant is always vested 100% in deferred salary contributions and Company stock purchased at a discount and becomes 100% vested in Company contributions after 3 years of service. Upon termination of service, participants are eligible to receive the vested value of their account in a lump sum payment or, if retired, in equal annual installments over a 10-year period or deferred until a future date no later than age 70-1/2. 7 NOTES TO FINANCIAL STATEMENTS (CONTINUED) ----------------------------------------- While in service, a participant may apply for a hardship withdrawal of funds subject to restrictive IRS rules and excise tax. The Plan also permits a participant to borrow against his/her account and repay the loan by payroll deduction. Plan participants who are no longer employees of the Company but who have elected to defer payment of their account balance are assessed an asset management trust and recordkeeping fee based on actual cost. These participant account balances amount to $3,148,482 at December 31, 1995. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ------------------------------------------ Investments, other than insurance contracts, are stated at fair value. Investments in securities traded on a national securities exchange are valued at the last reported sales price on the last business day of the year. Listed securities and governmental obligations for which no sale was reported on that date are valued at the last reported bid price. Investments in guaranteed interest contracts with insurance companies are stated at contract value defined as cost plus accrued interest less distributions to date, which approximates fair value. Purchases and sales of securities are reflected on a trade-date basis. The Plan presents in the statements of changes in net assets the net appreciation (depreciation) in the fair value of its investments which consists of the realized gains or losses and the unrealized appreciation (depreciation) on those investments. Dividend income is accrued on the ex-dividend date. Income from other investments is recorded as earned on an accrual basis. 3. TAX STATUS ---------- The Plan has received a favorable determination letter from the IRS (dated May 9, 1995). This favorable determination by the IRS does apply on a retroactive basis to periods including the financial statement date. 4. PLAN TERMINATION ---------------- The Company adopted this Plan with a view to maintaining it permanently. However, the Company reserves the right to modify or amend the Plan from time to time, or to terminate the Plan, and to discontinue making contributions temporarily or permanently depending upon business and economic conditions. The Company cannot amend the Plan so as to deprive any participant of benefits already accrued under the Plan at the time of amendment, nor can the Company take back any contributions which it has made to the Plan except in limited circumstances involving factual error or contributions thought to be deductible which are not deductible. Should the Plan terminate, accounts would become fully vested, regardless of years of service, and would be paid to participants as directed by the Committee administering the Plan. 8 NOTES TO FINANCIAL STATEMENTS (CONTINUED) ----------------------------------------- 5. INVESTMENTS ----------- Investments held at December 31, 1995 and 1994 are as follows:
Description Current Value Cost - ----------- ------------------------ ------------------------ 1995 1994 1995 1994 ----------- ----------- ----------- ----------- Investments stated at fair value: Company common stock $ 1,873,933 $ 1,109,342 $ 1,741,706 $ 1,630,513 Diversified investments: Government securities 1,036,330 397,155 982,003 394,104 Common & preferred stock 8,643,280 6,225,859 6,481,257 5,396,028 Short-term investments (1) 882,338 919,677 882,338 919,677 Investments stated at contract value: Guaranteed interest contracts 9,425,884 9,463,160 9,425,884 9,463,160 ----------- ----------- ----------- ----------- Total investments $21,861,765 $18,115,193 $19,513,188 $17,803,482 =========== =========== =========== ===========
(1) Short-term investments include temporary investments made within each of the available Funds. The following investments exceed 5% of Plan assets at December 31, 1995:
Current Value ------------- Investments stated at contract value: 1991 GIC Allstate Life Insurance Company $1,065,148 Contract #GA5052 1993 GIC Principal Mutual Life Insurance 5,996,330 Contract #GA88705-3 1994 GIC American International Life 1,552,305 Assurance Company Contract #18181 Investments stated at fair value: 182,822.74 shares Brown & Sharpe Manufacturing 1,873,933 Company Common Stock Class A & B
The following investments exceed 5% of Plan Assets at December 31, 1994:
Current Value ------------- Investments stated at contract value: 1991 GIC Allstate Life Insurance Company $1,073,142 Contract #GA5052 1993 GIC Principal Mutual Life Insurance 6,525,546 Contract #GA88705-3 1994 GIC American International Life 1,021,841 Assurance Company Contract #18181 Investments stated at fair value: 167,488 shares Brown & Sharpe Manufacturing 1,109,342 Company Common Stock Class A & B
9 NOTES TO FINANCIAL STATEMENTS (CONTINUED) ----------------------------------------- 6. ALLOCATION OF STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS AND ---------------------------------------------------------------------- STATEMENTS OF INCOME AND CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS --------------------------------------------------------------------------
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS AT DECEMBER 31, 1995, WITH FUND INFORMATION ----------------------------------------------------------------------------------------------- Money Market Diversified(1) Company(1) Guaranteed(1) Plan Loans Fund Fund Stock Fund Interest Fund Total -------------- ------------- ------------------ -------------- ------------- ------------ Assets: Investments $ - $602,217 $ 9,827,923 $1,919,432 $9,512,193 $21,861,765 Dividends and interest receivable - 2,126 32,422 52 52,242 86,842 Employer contribution receivable - 112,039 491,748 31,165 124,071 759,023 Plan loans receivable 260,451 - - - - 260,451 -------- -------- --------------- ---------- ---------- ----------- Net Assets Available for Plan Benefits $260,451 $716,382 $10,352,093 $1,950,649 $9,688,506 $22,968,081 ======== ======== =============== ========== ========== ===========
- -------------- (1) Includes short-term investments of $148,313 in the Diversified Fund, $45,499 in the Company Stock Fund, and $86,309 in the Guaranteed Interest Fund.
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS AT DECEMBER 31, 1994, WITH FUND INFORMATION ----------------------------------------------------------------------------------------------- Money Market Diversified(2) Company(2) Guaranteed Plan Loans Fund Fund Stock Fund Interest Fund Total ------------- ------------- ------------------ -------------- -------------- ------------ Assets: Investments $ - $455,255 $ 6,995,173 $1,148,856 $9,515,909 $18,115,193 Dividends and interest receivable - 15 18,199 102 54,097 72,413 Employer contribution receivable - 71,358 302,084 20,236 224,372 618,050 Plan loans receivable 257,669 - - - - 257,669 -------- -------- ----------- ---------- ---------- ----------- Net Assets Available for Plan Benefits $257,669 $526,628 $ 7,315,456 $1,169,194 $9,794,378 $19,063,325 ======== ======== =========== ========== ========== ===========
- ----------------- (2) Includes short-term investments of $372,159 in the Diversified Fund, $39,514 in the Company Stock Fund, and $52,749 in the Guaranteed Interest Fund. 10 NOTES TO FINANCIAL STATEMENTS (CONTINUED) ----------------------------------------- 6. ALLOCATION OF STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS AND ---------------------------------------------------------------------- STATEMENTS OF INCOME AND CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS -------------------------------------------------------------------------- (CONTINUED) -----------
STATEMENT OF INCOME AND CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS FOR THE YEAR ENDED DECEMBER 31, 1995, --------------------------------------------------------------------------------------------------------------- WITH FUND INFORMATION --------------------- Money Diversified Company Stock Guaranteed Plan Loans Market Fund Fund Fund Interest Fund Total ---------------- -------------- ----------- ------------- ------------- ------------- Contributions: Employer $ - $112,039 $ 491,748 $ 60,531 $ 124,071 $ 788,389 Employee - 69,775 659,500 117,459 349,055 1,195,789 Loan repayments (121,146) 4,526 48,977 7,706 59,937 - --------- -------- ----------- ---------- ----------- ----------- (121,146) 186,340 1,200,225 185,696 533,063 1,984,178 Investment income: Interest - 38,695 76,710 2,281 627,050 744,736 Dividends - - 36,276 - - 36,276 --------- -------- ----------- ---------- ----------- ----------- - 38,695 112,986 2,281 627,050 781,012 Net appreciation in fair value of investments - - 2,051,965 763,252 - 2,815,217 --------- -------- ----------- ---------- ----------- ----------- Total income (121,146) 225,035 3,365,176 951,229 1,160,113 5,580,407 Disbursements Payments to participants - (61,407) (249,068) (148,196) (1,262,224) (1,720,895) Loans to participants 119,450 (16,972) (76,715) (4,019) (21,744) - Fees - (88) (10,215) (367) (1,732) (12,402) --------- -------- ----------- ---------- ----------- ----------- Total disbursements 119,450 (78,467) (335,998) (152,582) (1,285,700) (1,733,297) Transfers Transfers (to) from ESOP - 622 138 (2,105) 12,728 11,383 Transfers from SARP 4,478 - 11,234 1,383 29,168 46,263 Transfers between funds - 42,564 (3,913) (16,470) (22,181) - --------- -------- ----------- ---------- ----------- ----------- Net transfers 4,478 43,186 7,459 (17,192) 19,715 57,646 --------- -------- ----------- ---------- ----------- ----------- Net increase (decrease) 2,782 189,754 3,036,637 781,455 (105,872) 3,904,756 Net assets, beginning of year 257,669 526,628 7,315,456 1,169,194 9,794,378 19,063,325 --------- -------- ----------- ---------- ----------- ----------- Net assets, end of year $ 260,451 $716,382 $10,352,093 $1,950,649 $ 9,688,506 $22,968,081 ========= ======== =========== ========== =========== ===========
11 NOTES TO FINANCIAL STATEMENTS (CONTINUED) ----------------------------------------- 6. ALLOCATION OF STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS AND ---------------------------------------------------------------------- STATEMENTS OF INCOME AND CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS -------------------------------------------------------------------------- (CONTINUED) -----------
STATEMENT OF INCOME AND CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS FOR THE YEAR ENDED DECEMBER 31, 1994, --------------------------------------------------------------------------------------------------------------- WITH FUND INFORMATION --------------------- Money Diversified Company Stock Guaranteed Plan Loans Market Fund Fund Fund Interest Fund Total ------------- ------------- ----------- ------------- ------------- ------------- Contributions: Employer $ - $ 71,358 $ 302,084 $ 43,611 $ 224,372 $ 641,425 Employee - 34,170 481,534 96,049 280,510 892,263 Loan repayments (101,915) 7,014 46,441 9,235 39,225 - --------- --------- ----------- ---------- ----------- ----------- (101,915) 112,542 830,059 148,895 544,107 1,533,688 Investment income: Interest - 16,824 66,312 2,173 638,029 723,338 Dividends - - 93,572 - - 93,572 --------- --------- ----------- ---------- ----------- ----------- - 16,824 159,884 2,173 638,029 816,910 Net depreciation in fair value of investments - - (80,279) (175,167) - (255,446) --------- --------- ----------- ---------- ----------- ----------- Total income (101,915) 129,366 909,664 (24,099) 1,182,136 2,095,152 Disbursements Payments to participants - (144,510) (1,837,684) (93,826) (1,602,794) (3,678,814) Loans to participants 111,600 (1,818) (88,563) (629) (20,590) - Loan defaults (2,490) - - - - (2,490) Fees - (384) (24,486) (6,995) (6,149) (38,014) --------- --------- ----------- ---------- ----------- ----------- Total disbursements 109,110 (146,712) (1,950,733) (101,450) (1,629,533) (3,719,318) Transfers Transfers from ESOP - 6,026 17,468 - 1,500 24,994 Transfers from (to) SARP - - 2,666 (5,850) 458 (2,726) Transfers between funds - (55,253) 1,319,001 (91,495) (1,172,253) - --------- --------- ----------- ---------- ----------- ----------- Net transfers - (49,227) 1,339,135 (97,345) (1,170,295) 22,268 --------- --------- ----------- ---------- ----------- ----------- Net increase (decrease) 7,195 (66,573) 298,066 (222,894) (1,617,692) (1,601,898) Net assets, beginning of year 250,474 593,201 7,017,390 1,392,088 11,412,070 20,665,223 --------- --------- ----------- ---------- ----------- ----------- Net assets, end of year $ 257,669 $ 526,628 $ 7,315,456 $1,169,194 $ 9,794,378 $19,063,325 ========= ========= =========== ========== =========== ===========
12 NOTES TO FINANCIAL STATEMENTS (CONTINUED) ----------------------------------------- 7. TRANSACTIONS WITH PARTIES-IN-INTEREST -------------------------------------
DURING THE YEARS ENDED DECEMBER 31, 1995 AND 1994, THE PLAN ENTERED INTO THE FOLLOWING TRANSACTIONS WITH PARTIES-IN-INTEREST: December 31 ----------------------------------------------------------------------- 1995 1994 ---------------------------------- ---------------------------------- Units/Shares Amount Units/Shares Amount ----------------- ---------------- ----------------- --------------- Fleet National Bank Money Market Fund: - ---------------------------------------- Purchases of face amount -- $6,581,041 -- $12,270,546 Sales of face amount -- 6,814,326 -- 12,276,465 Investment income -- 17,253 -- 19,070 Brown & Sharpe Manufacturing Company Class A - -------------------------------------------- Purchases of capital stock 2,939 $ 20,074 -- $ -- Distributions of capital stock to 4,518 43,224 -- -- participants Sales of capital stock, at market value -- -- 10,635 73,711
13 BROWN & SHARPE SAVINGS & RETIREMENT PLAN FOR MANAGEMENT EMPLOYEES SCHEDULE OF REPORTABLE TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 1995 ------------------------------------
CURRENT VALUE OF ASSET ON IDENTITY OF PARTY INVOLVED DESCRIPTION OF ASSETS PURCHASE PRICE SELLING PRICE COST OF ASSET TRANSACTION DATE NET GAIN - --------------------------- ---------------------- -------------- ----------------- ------------- ------------------- -------- Category (iii) A series of securities transactions in excess of 5% of plan assets - -------------------------------------------------------------------------------------- Fleet National Bank* Fleet Money Market Purchased $6,581,041 face amount in 265 transactions $6,581,041 $ -- $6,581,041 $6,581,041 $ -- Sold $6,814,326 face amount in 207 transactions -- 6,814,326 6,814,326 6,814,326 -- Category (iii) Continued - ---------------------------- Principal Mutual Life Principal Mutual GIC Insurance Corporation #88705-3 - 6.38%, 12-31-97 Purchased $406,019 face value in 12 transactions. $ 406,019 $ -- $ 406,019 $ 406,019 $ -- Sold $1,024,743 face value in 12 transactions. -- 1,024,743 1,024,743 1,024,743 --
There were no category (i), (ii) or (iv) reportable transactions during 1995. * Indicates party-in-interest to the Plan. 14 BROWN & SHARPE SAVINGS & RETIREMENT PLAN FOR MANAGEMENT EMPLOYEES SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT DECEMBER 31, 1995
FAIR COST OF SHARES OR FACE VALUE DESCRIPTION VALUE INVESTMENT ================================================================================ MONEY MARKET FUND Short-Term Investments 5,111 Fleet Money Market $ 5,111 $ 5,111 597,106 Fidelity Retirement Mny Mkt Prt 630 597,106 597,106 ----------- ------------ Total Money Market Fund $ 602,217 $ 602,217 =========== ============ DIVERSIFIED FUND Short-Term Investments 148,313 Fleet Money Market $ 148,313 $ 148,313 Government Securities 294,670 US Treas Notes 8.625 due 8/15/97 310,140 286,872 168,383 US Treas Notes 7.75 due 12/31/99 182,722 167,988 168,383 US Treas Notes 5.875 due 6/30/00 171,803 167,962 84,191 US Treas Notes 6.375 due 8/15/02 88,282 83,928 84,191 US Treas Bonds 11.125 due 8/15/03 112,974 111,343 168,383 US Treas Notes 5.75 due 8/15/03 170,409 163,910 ---------- ------------ Total Government Securities 1,036,330 982,003 Common Equities 2,189 Alco Std Corp Com 99,872 57,734 3,031 Altera Corp 150,787 53,831 6,483 America West Airls Inc. Cl B 110,207 86,493 1,852 Amerin Corp Com 49,547 32,506 1,684 Amr Corp Del Com 125,024 118,332 2,947 Analog Devices Inc. 104,240 107,295 3,368 Applied Materials Inc. Com 132,602 83,366 4,546 Atlas Air Inc. Com 76,151 81,167 6,735 Atmel Corp 150,703 75,098 2,105 Bank of Boston Corp Com 97,346 93,647 1,684 Bankamerica Corp Com 109,028 85,830 3,789 Barnes & Noble Inc. 109,870 107,976 3,157 Bay Networks Inc. Com 129,839 81,725 2,105 Borders Group Inc. Com 38,939 37,708 1,684 Cabletron Sys Inc. Com 136,390 79,335
15 BROWN & SHARPE SAVINGS & RETIREMENT PLAN FOR MANAGEMENT EMPLOYEES SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT DECEMBER 31, 1995
FAIR COST OF SHARES OR FACE VALUE DESCRIPTION VALUE INVESTMENT ================================================================================ 2,021 Canadian National Railway Co. Com 30,309 29,085 6,062 Central Garden & Pet Co. Com 57,587 43,783 2,694 Ceridian Corp 111,133 50,547 2,357 Chemical Banking Corp 138,495 128,994 1,684 Cisco Sys Inc. Com 125,656 85,486 2,273 Citicorp Com 152,871 91,391 3,368 Cognex Corp 117,026 48,121 4,210 Columbia/HCA Healthcare Corp Com 213,636 83,910 2,947 Community Health Sys Inc. 104,976 99,487 2,694 Corporate Express Inc. Com 81,161 64,343 3,368 Danaher Corp 106,923 63,824 3,199 Danaka Business Systems Plc Adr 118,373 91,706 2,694 Diamond Multimedia Sys Inc. Com 96,652 84,191 842 Donaldson Lufkin & Jenrette Inc. Com 26,310 23,704 4,210 Dovatron Intl Inc. 142,073 82,876 2,526 DSC Communications Corp Com 93,137 89,777 1,684 Eckerd Jack Corp Del 75,141 60,326 1,094 Filenet Corp Com 51,441 49,925 505 Fore Systems 30,056 28,490 Inc. Com 2,778 FTP Software Inc. Com 80,571 89,371 2,273 GCR Hldgs Ltd Com 51,146 44,985 5,051 General Nutrition Cos Inc. 116,184 92,032 1,684 Global Directmail Corp Com 46,305 46,679 4,210 Gymboree Corp 86,822 94,498 1,263 Healthcare Compare Corp 54,935 25,074 5,893 Healthsource Inc. 212,162 114,852 4,210 Healthsouth Corporation 122,604 76,119 3,368 Hewlett Packard Co Com 282,041 110,024 2,526 Hilfiger Tommy Corp 107,028 52,744 4,210 HyperionSoftware Corp Com 89,453 84,849 5,220 Intel Corp Com 296,228 116,531 2,863 International Rectifier Corp 71,563 46,389 421 Jones Apparel Group Inc. 16,575 14,438 2,357 Kensey Nash Corp Com 29,467 30,056 1,684 KLA Instrs Corp 43,886 69,671 1,094 Kohls Corp 57,461 56,464 2,526 La Quinta Inns, Inc. 69,142 70,294 1,684 Lam Research Corporation 77,035 73,119 842 Linear Technology Corp 33,045 32,767
16 BROWN & SHARPE SAVINGS & RETIREMENT PLAN FOR MANAGEMENT EMPLOYEES SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT DECEMBER 31, 1995
FAIR COST OF SHARES OR FACE VALUE DESCRIPTION VALUE INVESTMENT ================================================================================ 2,526 LSI Logic Corp 82,718 101,558 842 Maxim Integrated 32,414 30,959 Prods Inc. 674 Medtronic Inc. 37,634 33,289 421 Micro Whse Inc. 18,206 20,480 1,852 Microchip Technology 67,606 74,611 Inc. 842 Microsoft Corp 73,878 83,349 674 MSC Indl Direct Inc. 18,522 12,797 CL A Com 1,684 Nationsbank Corp 117,237 78,805 337 Network Appliance 13,513 6,115 Inc. Com 674 Newbridge Networks Corp 27,867 27,971 3,452 Norrell corp GA Common 101,398 82,575 Stk 1,684 Norwest Corp 55,566 42,150 5,472 Officemax Inc. Com 122,446 85,786 5,809 Ornda Healthcorp 135,064 87,374 Com Stk 1,263 Oxford Health Plans 93,295 67,788 Inc. 589 Pacificare Health Sys 51,273 51,308 Inc. 4,294 Paging Network Inc. 104,661 102,571 842 Parametric Technology 55,987 30,259 Corp Com 2,189 Petiatric Svcs of 34,476 35,976 America Com 1,263 Physicians Health Svcs 46,726 48,250 Inc. 2,947 Platinum Technology 54,146 53,777 Inc. 842 Promus Hotel Corp Com 18,733 17,285 421 Qualcomm Inc. 18,101 18,179 4,210 Quorum Health Group Inc. 92,611 65,994 Com Stk 758 Regal Cinemas Inc. Com 22,542 20,888 2,610 SFX Broadcasting Inc. 78,951 75,186 1,263 Silicon Graphics Inc. 34,887 42,228 842 Sitel Corp Com 25,784 22,250 2,105 Sodak Gaming Inc. 43,411 41,876 3,368 Softkey Intl Inc. Com 77,877 94,516 1,684 Solectron Corp Com 74,299 44,922 2,526 Spectrian Corp Com 56,198 83,819 1,684 Sterling Healthcare 17,891 22,732 Group Inc. Com 253 Stratacom Inc. 18,564 18,091 2,021 Sun Microsystems 92,190 82,137 4,210 TCF Finl Corp 139,442 86,005 421 Tellabs Incorporated 15,575 16,585 3,368 Teradyne Common 84,612 40,710 2,189 Texas Instruments 112,732 141,344 Com
17 BROWN & SHARPE SAVINGS & RETIREMENT PLAN FOR MANAGEMENT EMPLOYEES SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT DECEMBER 31, 1995
FAIR COST OF SHARES OR FACE VALUE DESCRIPTION VALUE INVESTMENT =================================================================================== 2,357 Trimble Nav Ltd. 43,906 53,612 2,947 US Office Prods Co. Com 67,037 44,108 3,789 United Healthcare Corp 247,681 94,348 5,051 United States Filtr Corp New 134,496 87,179 2,526 USA Waste Svcs Inc. Com 47,673 49,973 1,010 Valudjet Inc. Com 25,005 17,975 1,936 Washington Mut Inc. Com 55,914 52,100 1,263 Worldcom Inc. GA Com 44,516 38,202 2,021 Xilinx Inc. 61,628 30,102 842 3 Com Corp 39,254 38,728 2,947 3-D Sys Corp Del 69,983 59,470 ------------ ---------- Total Common Equities $ 8,643,280 $6,481,257 Total Diversified Fund $ 9,827,923 $7,611,573 ============ ========== COMPANY STOCK FUND Short-Term Investments 45,499 Fleet Money Market $ 45,499 $ 45,499 Company Common Stock 182,822.74 Brown & Sharpe Mfg Co Cl A & B $ 1,873,933 $1,741,706 ------------ ---------- Total Company Common Stock $ 1,873,933 $1,741,706 Total Company Stock Fund $ 1,919,432 $1,787,205 ============ ========== Guaranteed Interest Contracts Blended GIC Fleet Money Market $ 83,783 $ 83,783 A I Life GIC #18181 6.38% due 12/31/99 1,552,305 1,552,305 Principal Mutual GIC #88705-3 6.38% due 12/31/97 5,996,330 5,996,330 --------- --------- Total Blended GIC $ 7,632,418 $ 7,632,418 1992 GIC Fleet Money Market $ 1,521 $ 1,521 Principal Mutual GIC #(3)88705-02 6.80% due 12/31/96 812,101 812,101 --------- --------- $ 813,622 $ 813,622
18 BROWN & SHARPE SAVINGS & RETIREMENT PLAN FOR MANAGEMENT EMPLOYEES SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT DECEMBER 31, 1995
FAIR COST OF SHARES OR FACE VALUE DESCRIPTION VALUE INVESTMENT ==================================================================================== 1991 GIC Fleet Money Market $ 1,005 $ 1,005 Allstate Life Ins. GIC #GA5052 8.60% due 04/01/96 1,065,148 1,065,148 ------------ ----------- $ 1,066,153 $ 1,066,153 TOTAL GUARANTEED INTEREST CONTRACTS $ 9,512,193 $ 9,512,193 ============ =========== TOTAL INVESTMENTS $ 21,861,765 $19,513,188 PLAN LOANS RECEIVABLE $ 260,451 $ 260,451 ------------ ----------- TOTAL ASSETS HELD FOR INVESTMENTS $ 22,122,216 $19,773,639 ============ ===========
19 CONSENT OF INDEPENDENT AUDITORS We consent to the incorporation by reference in the Registration Statements (Form S-8 Nos. 2-33676, 2-56621, 2-60398, 2-77219, 2-77575, 2-83637, 2-97935, 33-17831, 33-23601, 33-23603, 33-30927, and 33-54496) of Brown & Sharpe Manufacturing Company of our report dated June 24, 1996, with respect to the financial statements and schedule of the Brown & Sharpe Savings and Retirement Plan included in this Annual Report (Form 11-K) for the year ended December 31, 1995. ERNST & YOUNG LLP Providence, Rhode Island June 24, 1996 20 EX-28.2 3 SAVINGS AND RETIREMENT PLAN Exhibit 28.2 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 11-K Annual Report Pursuant to Section 15(d) of the Securities Exchange Act of 1934 For the Fiscal Year Ended December 31, 1995 ----------------- Commission File Number 1-5881 ------ THE BROWN & SHARPE SAVINGS AND RETIREMENT PLAN ---------------------------------------------- (Full Title of the Plan) BROWN & SHARPE MANUFACTURING COMPANY 200 Frenchtown Road North Kingstown, Rhode Island 02852-1700 (401) 886-2000 (Name of Issuer and Address of its Principal Executive Office) SIGNATURES ---------- Pursuant to the requirements of the Securities Exchange Act of 1934, the Plan has duly caused this Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized, in North Kingstown, Rhode Island, on the 24th day of June 1996. - ---- --------- BROWN & SHARPE SAVINGS & RETIREMENT PLAN By: /s/ Alfred J. Corso ------------------------------- Alfred J. Corso Controller (Principal Accounting Officer) 2 THE BROWN & SHARPE SAVINGS AND RETIREMENT PLAN Table of Contents Page ----- Report of Ernst & Young LLP, Independent Auditors 4 Financial Statements: Statements of Net Assets Available for Plan Benefits at December 31, 1995 and 1994 5 Statements of Changes in Net Assets Available for Plan Benefits for the Years Ended December 31, 1995 and 1994 5 Notes to Financial Statements 6-13 Supplemental Schedules: Schedule of Reportable Transactions 14 Schedule of Assets Held for Investment Purposes at December 31, 1995 15-18 Consent of Independent Auditors 19 3 REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS ------------------------------------------------- Brown & Sharpe Savings and Retirement Plan Committee Brown & Sharpe Manufacturing Company We have audited the accompanying statements of net assets available for plan benefits of the Brown & Sharpe Savings and Retirement Plan (the Plan) as of December 31, 1995 and 1994, and the related statements of changes in net assets available for plan 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 generally accepted auditing standards. Those standards 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. An audit also includes 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, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan at December 31, 1995 and 1994, and the changes in its net assets available for benefits for the years then ended, in conformity with generally accepted accounting principles. Our audit was made for the purpose of forming an opinion on the financial statements taken as a whole. The accompanying supplemental schedules of assets held for investment purposes as of December 31, 1995, and reportable transactions for the year then ended, are presented for purposes of complying with the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974, and are not a required part of the financial statements. The supplemental schedules have been subjected to the auditing procedures applied in our audits of the financial statements and, in our opinion, are fairly stated in all material respects in relation to the financial statements taken as a whole. ERNST & YOUNG LLP June 24, 1996 4 THE BROWN & SHARPE SAVINGS & RETIREMENT PLAN -------------------------------------------- STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS ----------------------------------------------------
As of December 31, ---------------------- 1995 1994 ---------- ---------- Assets: Investments (Notes 2 and 5) $5,569,599 $5,132,173 Dividends and interest receivable 24,260 22,560 Employer contributions receivable 181,813 174,679 Plan loans receivable 70,355 69,241 ---------- ---------- Net Assets Available for Plan $5,846,027 $5,398,653 Benefits ========== ==========
STATEMENTS OF INCOME AND CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS - --------------------------------------------------------------------------
For the years ended December 31, ----------------------------------- 1995 1994 ----------------- ---------------- Additions - --------- Contributions: Employer $ 189,035 $ 180,795 Employee 295,062 234,428 ---------- ---------- 484,097 415,223 Investment income: Interest 230,153 221,076 Dividends 7,202 16,649 ---------- ---------- 237,355 237,725 Net appreciation (depreciation) in the fair value of investments 514,075 (53,660) ---------- ---------- Total additions 1,235,527 599,288 Deductions - ---------- Payments to participants (744,842) (735,565) Forfeitures (580) - Loan Default - (3,595) Fees (2,955) (5,071) ---------- ---------- Total deductions (748,377) (744,231) Transfers - --------- From Brown & Sharpe Employee Stock Owner- ship & Profit Participation Plan (ESOP) 6,487 3,700 (To) From Brown & Sharpe Savings & Retire- ment Plan for Mgmt. Employees (SARPM) (46,263) 2,726 ---------- ---------- Net transfers (39,776) 6,426 ---------- ---------- Net increase (decrease) in assets 447,374 (138,517) Net assets, beginning of year 5,398,653 5,537,170 ---------- ---------- Net assets, end of year $5,846,027 $5,398,653 ========== ==========
See notes to the financial statements 5 THE BROWN & SHARPE SAVINGS & RETIREMENT PLAN -------------------------------------------- NOTES TO FINANCIAL STATEMENTS ----------------------------- 1. PLAN DESCRIPTION ---------------- The following description of the Brown & Sharpe Savings and Retirement Plan (the "Plan") provides only general information. Participants should refer to the Summary Plan Description for more complete details. GENERAL ------- The Plan, which began on October 1, 1987, is a defined contribution plan covering all eligible full-time employees covered by a collective bargaining agreement of Brown & Sharpe Manufacturing Company (the "Company") and its affiliated companies who participate in the Plan. Such employees are immediately eligible to make deferred salary contributions to the Plan. One year of service is required to become a participant receiving Company contributions. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA) as amended. CONTRIBUTIONS ------------- The Plan permits a participant to make deferred salary contributions to the Plan equal to 2% to 16% of compensation up to a maximum of $9,240 in 1995 and in 1994 (indexed in future years) which is not subject to federal income tax until distributed. Contributions are invested at the direction of the employee in one or more investment alternatives, or "Funds," as described below. The Company may, at the discretion of the Board of Directors, make a supplemental contribution of 4% of annual compensation plus 4% of the amount over the Social Security wage base to the account of each participant to be invested as instructed by the participant. The Company's supplemental contributions for 1995 and 1994 were $181,813 and $174,679 respectively. In addition, the Plan provides for a Company contribution, or subsidy, equal to one-quarter of the amount of each deferred salary contribution invested directly in the Company Stock Fund. Such Company contributions for 1995 and 1994 were $7,222 and $6,117 respectively. PARTICIPANT ACCOUNTS -------------------- A separate account is established for each participant when enrolled in the Plan. Each participant's account is credited with participant salary deferrals, Company contributions, and an allocation of earnings of the Funds in which such participant's account is invested. Allocations, as determined by a monthly valuation, are credited ratably among all participants in each Fund. 6 NOTES TO FINANCIAL STATEMENTS (CONTINUED) ----------------------------------------- INVESTMENTS ----------- Participants direct the trustee to put contributions in one or more of the following investment alternatives in multiples of 10%: (1) the Diversified Fund, managed by Frontier Capital Management, Inc., consisting primarily of a diversified portfolio of stock and fixed income securities; (2) the Company Stock Fund, managed by Fleet National Bank, consisting primarily of Company common stock and cash; (3) the Money Market Fund, invested by Fleet National Bank through Fidelity Management & Research Company, consisting primarily of obligations of the U.S. Government or its agencies, banks and business corporations (other than the Company); or (4) the Guaranteed Interest Fund, consisting primarily of guaranteed investment contracts issued by American International Life Assurance Company of New York, Principal Mutual Life Insurance Company, and Allstate Life Insurance Company. These guaranteed investment contracts are agreements under which the issuer has agreed to pay the investor a guaranteed rate of interest over terms ranging from 3 to 5 years. The contracts automatically terminate at maturity date. A penalty is imposed upon early termination of contract. The issuers of these contracts are insurance companies, and because of this, the contracts are more susceptible to factors adversely affecting the insurance industry than similar contracts issued by parties other than insurance companies. Transfers between investment funds can be made subject to certain rules. The Plan assets, and those of the Brown & Sharpe Savings and Retirement Plan for Management Employees are held in a trust administered by Fleet National Bank as Trustee. The assets and activity within this trust are allocated between the two plans based on the underlying participant records of each plan. In years when Company contributions are made, forfeitures are used first to reduce Company contributions and then to pay Plan expenses. In 1995 forfeitures used to pay Plan expenses totaled $580. In 1994, Plan expenses were paid entirely by the Company. BENEFITS -------- A participant is always vested 100% in deferred salary contributions and Company stock purchased at a discount and becomes 100% vested in Company contributions after 3 years of service. Upon termination of service, participants are eligible to receive the vested value of their account in a lump sum payment or, if retired, in equal annual installments over a 10-year period or deferred until a future date no later than age 70-1/2. While in service, a participant may apply for a hardship withdrawal of funds subject to restrictive IRS rules and excise tax. The Plan also permits a participant to borrow against his/her account and repay the loan by payroll deduction. 7 NOTES TO FINANCIAL STATEMENTS (CONTINUED) ----------------------------------------- Plan participants who are no longer employees of the Company but who have elected to defer payment of their account balance are assessed an asset management trust and recordkeeping fee based on actual cost. These participant account balances amount to $950,142 at December 31, 1995. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ------------------------------------------ Investments, other than insurance contracts, are stated at fair value. Investments in securities traded on a national securities exchange are valued at the last reported sales price on the last business day of the year. Listed securities and governmental obligations for which no sale was reported on that date are valued at the last reported bid price. Investments in guaranteed interest contracts with insurance companies are stated at contract value determined as cost plus accrued interest, less distributions to date, which approximates fair value. Purchases and sales of securities are reflected on a trade-date basis. The Plan presents in the statements of changes in net assets the net appreciation (depreciation) in the fair value of its investments which consists of the realized gains or losses and the unrealized appreciation (depreciation) on those investments. Dividend income is accrued on the ex-dividend date. Income from other investments is recorded as earned on an accrual basis. 3. TAX STATUS ---------- The Plan has received a favorable determination letter from the IRS (dated April 11, 1995). This favorable determination by the IRS does apply on a retroactive basis to periods including the financial statement date. 4. PLAN TERMINATION ---------------- The Company adopted this Plan with a view to maintaining it permanently. However, the Company reserves the right to modify or amend the Plan from time to time, or to terminate the Plan, and to discontinue making contributions temporarily or permanently depending upon business and economic conditions. The Company cannot amend the Plan so as to deprive any participant of benefits already accrued under the Plan at the time of amendment, nor can the Company take back any contributions which it has made to the Plan except in limited circumstances involving factual error or contributions thought to be deductible which are not deductible. Should the Plan terminate, accounts would become fully vested, regardless of years of service, and would be paid to participants as directed by the Committee administering the Plan. 8 NOTES TO FINANCIAL STATEMENTS (CONTINUED) ----------------------------------------- 5. INVESTMENTS ----------- Investments held at December 31, 1995 and 1994 are as follows:
Description Current Value Cost - ----------- ---------------------- ---------------------- 1995 1994 1995 1994 ---------- ---------- ---------- ---------- Investments stated at fair value: Company common stock $ 373,420 $ 251,883 $ 347,071 $ 370,218 Diversified investments: Government securities 194,591 79,494 184,390 78,884 Common & preferred stock 1,622,939 1,246,167 1,216,984 1,080,069 Short-term investments (1) 197,381 245,244 197,381 245,244 Investments stated at contract value: Guaranteed interest contracts 3,181,268 3,309,385 3,181,268 3,309,385 ---------- ---------- ---------- ---------- Total investments $5,569,599 $5,132,173 $5,127,094 $5,083,800 ========== ========== ========== ==========
(1) Short-term investments include temporary investments made within each of the Funds. The following investments exceed 5% of Plan assets at December 31, 1995:
Current Value ------------------ Investments stated at contract value: 1991 GIC Allstate Life Insurance Company $ 347,351 Contract #GA5052 1993 GIC Principal Mutual Life Insurance 2,045,067 Contract #GA88705-03 1994 GIC American International Life 529,418 Assurance Company Contract #18181 Investment stated at fair value 36,431.26 shares Brown & Sharpe Manufacturing 373,420 Company Common Stock Class A & B
The following investments exceed 5% of Plan assets at December 31, 1994:
Current Value ------------------ Investments stated at contract value: 1991 GIC Allstate Life Insurance Company $ 366,905 Contract #GA5052 1992 GIC Principal Mutual Life Insurance 271,463 Contract #GA88705-02 1993 GIC Principal Mutual Life Insurance 2,309,388 Contract #GA88705-03 1994 GIC American International Life 361,629 Assurance Company Contract #18181
9 NOTES TO FINANCIAL STATEMENTS (CONTINUED) ----------------------------------------- 6. ALLOCATION OF STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS AND ---------------------------------------------------------------------- STATEMENTS OF INCOME AND CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS --------------------------------------------------------------------------
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS AT DECEMBER 31, 1995, WITH FUND INFORMATION ----------------------------------------------------------------------------------------------- Money Guaranteed (1) Plan Market Diversified(1) Company(1) Interest Loans Fund Fund Stock Fund Fund Total -------------- -------------- ------------------- ---------------- --------------- -------------- Assets: Investments $ - $131,413 $1,845,379 $382,150 $3,210,657 $5,569,599 Dividends and interest receivable - 418 6,130 11 17,701 24,260 Plan loans receivable 70,355 - - - - 70,355 Employer contributions receivable - 8,915 105,720 6,491 60,687 181,813 -------- -------- ---------- -------- ---------- ---------- Net Assets Available for Plan Benefits $ 70,355 $140,746 $1,957,229 $388,652 $3,289,045 $5,846,027 ======== ======== ========== ======== ========== ==========
(1) Includes short-term investments of $27,849 in the Diversified Fund, $8,730 in the Company Stock Fund, and $29,389 in the Guaranteed Interest Fund.
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS AT DECEMBER 31, 1994, WITH FUND INFORMATION ----------------------------------------------------------------------------------------------- Money Guaranteed Plan Market Diversified(2) Company(2) Interest Loans Fund Fund Stock Fund Fund Total -------------- -------------- ------------------- ---------------- -------------- -------------- Assets: Investments $ - $143,114 $1,400,152 $260,855 $3,328,052 $5,132,173 Dividends and interest receivable - 5 3,642 23 18,890 22,560 Plan loans receivable 69,241 - - - - 69,241 Employer contributions receivable - 5,686 66,871 2,234 99,888 174,679 -------- -------- ---------- -------- ---------- ---------- Net Assets Available for Plan Benefits $ 69,241 $148,805 $1,470,665 $263,112 $3,446,830 $5,398,653 ======== ======== ========== ======== ========== ==========
(2) Includes short-term investments of $74,491 in the Diversified Fund, $8,972 in the Company Stock Fund, and $18,667 in the Guaranteed Interest Fund. 10 NOTES TO FINANCIAL STATEMENTS (CONTINUED) ----------------------------------------- 6. ALLOCATION OF STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS AND ---------------------------------------------------------------------- STATEMENTS OF INCOME AND CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS -------------------------------------------------------------------------- (CONTINUED) -----------
STATEMENT OF INCOME AND CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS FOR THE YEAR ENDED DECEMBER 31, 1994, WITH FUND INFORMATION - ------------------------------------------------------------------------------------------------------------------------------------ Plan Money Mkt. Diversified Company Stock Guaranteed Loans Fund Fund Fund Interest Fund Total ----------- ------------ ----------- ------------ ------------- ----------- Contributions: Employer $ - $ 8,915 $ 105,720 $ 13,713 $ 60,687 $ 189,035 Employee - 8,505 119,517 28,889 138,151 295,062 Loan repayments (23,752) - 7,184 5,873 10,695 - -------- -------- ---------- -------- ---------- ---------- (23,752) 17,420 232,421 48,475 209,533 484,097 Investment income: Interest - 8,230 15,211 1,451 205,261 230,153 Dividends - - 7,202 - - 7,202 -------- -------- ---------- -------- ---------- ---------- - 8,230 22,413 1,451 205,261 237,355 Net appreciation in the fair value of investments - - 386,160 127,915 - 514,075 -------- -------- ---------- -------- ---------- ---------- Total income (23,752) 25,650 640,994 177,841 414,794 1,235,527 Disbursements Payments to participants - (33,741) (142,189) (41,176) (527,736) (744,842) Loans to participants 29,344 (946) (18,245) - (10,153) - Forfeitures - (580) - - - (580) Fees - (17) (1,370) (3) (1,565) (2,955) -------- -------- ---------- -------- ---------- ---------- Total disbursements 29,344 (35,284) (161,804) (41,179) (539,454) (748,377) Transfers Transfers (to) from ESOP - 1,575 - (258) 5,170 6,487 Transfers to SARPM (4,478) - (11,234) (1,383) (29,168) (46,263) Transfers between funds - - 18,608 (9,481) (9,127) - -------- -------- ---------- -------- ---------- ---------- Net transfers (4,478) 1,575 7,374 (11,122) (33,125) (39,776) -------- -------- ---------- -------- ---------- ---------- Net increase (decrease) 1,114 (8,059) 486,564 125,540 (157,785) 447,374 Net assets, beginning of 69,241 148,805 1,470,665 263,112 3,446,830 5,398,653 year -------- -------- ---------- -------- ---------- ---------- Net assets, end of year $ 70,355 $140,746 $1,957,229 $388,652 $3,289,045 $5,846,027 ======== ======== ========== ======== ========== ==========
11 NOTES TO FINANCIAL STATEMENTS (CONTINUED) ----------------------------------------- 6. ALLOCATION OF STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS AND ---------------------------------------------------------------------- STATEMENTS OF INCOME AND CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS -------------------------------------------------------------------------- (CONTINUED) -----------
STATEMENT OF INCOME AND CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS FOR THE YEAR ENDED DECEMBER 31, 1994, --------------------------------------------------------------------------------------------------------------- WITH FUND INFORMATION --------------------- Plan Money Mkt. Diversified Company Stock Guaranteed Loans Fund Fund Fund Interest Fund Total ----------- ------------ ----------- ------------ ------------- ------------- Contributions: Employer $ - $ 5,686 $ 66,871 $ 8,351 $ 99,887 $ 180,795 Employee - 3,079 86,790 24,467 120,092 234,428 Loan repayments (20,581) - 6,183 5,509 8,889 - -------- -------- ---------- -------- ---------- ---------- (20,581) 8,765 159,844 38,327 228,868 415,223 Investment income: Interest - 5,197 2,878 1,519 211,482 221,076 Dividends - - 16,649 - - 16,649 -------- -------- ---------- -------- ---------- ---------- - 5,197 19,527 1,519 211,482 237,725 Net depreciation in the fair value of investments - - (14,284) (39,376) - (53,660) -------- -------- ---------- -------- ---------- ---------- Total income (20,581) 13,962 165,087 470 440,350 599,288 Disbursements Payments to participants - (20,379) (123,972) (8,939) (582,275) (735,565) Loans to participants 26,485 - (11,642) (275) (14,568) - Loan defaults (3,595) - - - - (3,595) Fees - (31) (2,754) (134) (2,152) (5,071) -------- -------- ---------- -------- ---------- ---------- Total disbursements 22,890 (20,410) (138,368) (9,348) (598,995) (744,231) Transfers Transfers from ESOP - - 1,824 - 1,876 3,700 Transfers from (to) - - (2,666) 5,850 (458) 2,726 SARPM Transfers between funds - 36,888 196,220 (48,543) (184,565) - -------- -------- ---------- -------- ---------- ---------- Net transfers - 36,888 195,378 (42,693) (183,147) 6,426 -------- -------- ---------- -------- ---------- ---------- Net increase (decrease) 2,309 30,440 222,097 (51,571) (341,792) (138,517) Net assets, beginning of year 66,932 118,365 1,248,568 314,683 3,788,622 5,537,170 -------- -------- ---------- -------- ---------- ---------- Net assets, end of year $ 69,241 $148,805 $1,470,665 $263,112 $3,446,830 $5,398,653 ======== ======== ========== ======== ========== ==========
12 NOTES TO FINANCIAL STATEMENTS (CONTINUED) ----------------------------------------- 7. TRANSACTIONS WITH PARTIES-IN-INTEREST -------------------------------------
DURING THE YEARS ENDED DECEMBER 31, 1995 AND 1994, THE PLAN ENTERED INTO THE FOLLOWING TRANSACTIONS WITH PARTIES-IN-INTEREST: December 31 ---------------------------------------------------------------------- 1995 1994 ---------------------------------- ---------------------------------- Units/Shares Amount Units/Shares Amount ----------------- --------------- ----------------- --------------- Fleet National Bank Money Market Fund: - ---------------------------------------- Purchases of face amount -- $1,539,816 -- $2,785,511 Sales of face amount -- 1,577,038 -- 2,786,177 Investment income -- 3,991 -- 4,476 Brown & Sharpe Manufacturing Company - ------------------------------------ Class A - ------- Purchases of capital stock 661 $ 4,517 -- $ -- Distributions of capital stock to 593 5,645 -- -- participants Sales of capital stock, at market value -- -- 2,436 16,880
13 BROWN & SHARPE SAVINGS & RETIREMENT PLAN SCHEDULE OF REPORTABLE TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 1995 ------------------------------------
CURRENT VALUE OF --------------- ASSET ON TRANSACTION -------------------- IDENTITY OF PARTY INVOLVED DESCRIPTION OF ASSETS PURCHASE PRICE SELLING PRICE COST OF ASSET DATE NET GAIN - --------------------------- ---------------------- -------------- --------------- ------------- --------------------- -------- Category (iii) A series of securities transactions in excess of 5% of plan assets - -------------------------------------------------------------------------------------- Fleet National Bank* Fleet Money Market Purchased $1,539,816 face amount in 265 transactions $1,539,816 $ -- $1,539,816 $1,539,816 $ -- Sold $1,577,038 in 207 transactions -- 1,577,038 1,577,038 1,577,038 -- Principal Mutual Life Principal Mutual GIC Insurance Corporation #88705-3, 6.38%, 12-31-97 Purchased $114,718 face amount in 12 transactions. $ 114,718 $ -- $ 114,718 $ 114,718 $ -- Sold $289,535 face amount in 12 transactions. -- 289,535 289,535 289,535 --
There were no category (i), (ii) or (iv) reportable transactions during 1995. * Indicates party-in-interest to the Plan 14
BROWN & SHARPE SAVINGS & RETIREMENT PLAN SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT DECEMBER 31, 1995 SHARES OR FACE VALUE DESCRIPTION FAIR VALUE COST OF INVESTMENT ================================================================================================================================== MONEY MARKET FUND Short-Term Investments 1,115 Fleet Money Market 1,115 1,115 130,298 Fidelity Retirement Mny Mkt Prt 630 130,298 130,298 -------- -------- Total Money Market Fund $131,413 $131,413 ======== ======== DIVERSIFIED FUND Short-Term Investments 27,849 Fleet Money Market 27,849 27,849 Government Securities 55,330 US Treas Notes 8.625 due 8/15/97 58,235 53,866 31,617 US Treas Notes 7.75 due 12/31/99 34,310 31,543 31,617 US Treas Notes 5.875 due 6/30/00 32,259 31,538 15,809 US Treas Notes 6.375 due 8/15/02 16,577 15,759 15,809 US Treas Bonds 11.125 due 8/15/03 21,213 20,907 31,617 US Treas Notes 5.75 due 8/15/03 31,997 30,777 -------- -------- Total Government Securities $194,591 $184,390 Common Equities 411 Alco Std Corp Com 18,753 10,841 569 Altera Corp 28,313 10,108 1,217 America West Airls Inc. Cl B 20,693 16,241 348 Amerin Corp Com 9,303 6,104 316 Amr Corp Del Com 23,476 22,219 553 Analog Devices Inc. 19,573 20,147 632 Applied Materials Inc. Com 24,898 15,654 854 Atlas Air Inc. Com 14,299 15,241 1,265 Atmel Corp 28,297 14,101 395 Bank of Boston Corp Com 18,279 17,584 316 Bankamerica Corp Com 20,472 16,116 711 Barnes & Noble Inc. 20,630 20,274 593 Bay Networks Inc. Com 24,380 15,345 395 Borders Group Inc. Com 7,311 7,080 316 Cabletron Sys Inc. Com 25,610 14,897 379 Canadian National Railway Co. Com 5,691 5,461 1,138 Central Garden & Pet Co. Com 10,813 8,221 506 Ceridian Corp 20,867 9,491 443 Chemical Banking Corp 26,005 24,221 316 Cisco Sys Inc. Com 23,594 16,052
15 BROWN & SHARPE SAVINGS & RETIREMENT PLAN SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT DECEMBER 31, 1995
SHARES OR FACE VALUE DESCRIPTION FAIR VALUE COST OF INVESTMENT ================================================================================================================================= 427 Citicorp Com 28,704 17,160 632 Cognex Corp 21,974 9,036 790 Columbia/HCA Healthcare Corp Com 40,114 15,756 553 Community Health Sys Inc. 19,711 18,681 506 Corporate Express Inc. Com 15,239 12,082 632 Danaher Corp 20,077 11,984 601 Danaka Business Systems Plc Adr 22,227 17,220 506 Diamond Multimedia Sys Inc. Com 18,148 15,809 158 Donaldson Lufkin & Jenrette Inc. Com 4,940 4,451 790 Dovatron Intl Inc. 26,677 15,561 474 DSC Communications Corp Com 17,488 16,857 316 Eckerd Jack Corp Del 14,109 11,327 206 Filenet Corp Com 9,659 9,374 95 Fore Systems Inc. Com 5,644 5,350 522 FTP Software Inc. Com 15,129 16,781 427 GCR Hldgs Ltd Com 9,604 8,447 949 General Nutrition Cos Inc. 21,816 17,281 316 Global Directmail Corp Com 8,695 8,765 790 Gymboree Corp 16,303 17,744 237 Healthcare Compare Corp 10,315 4,708 1,107 Healthsource Inc. 39,838 21,566 790 Healthsouth Corporation 23,021 14,293 632 Hewlett Packard Co Com 52,959 20,659 474 Hilfiger Tommy Corp 20,097 9,904 790 HyperionSoftware Corp Com 16,797 15,932 980 Intel Corp Com 55,622 21,881 537 International Rectifier Corp 13,437 8,710 79 Jones Apparel Group Inc. 3,112 2,711 443 Kensey Nash Corp Com 5,533 5,644 316 KLA Instrs Corp 8,240 13,082 206 Kohls Corp 10,789 10,602 474 La Quinta Inns, Inc. 12,983 13,199 316 Lam Research Corporation 14,465 13,729 158 Linear Technology Corp 6,205 6,153 474 LSI Logic Corp 15,532 19,069 158 Maxim Integrated Prods Inc. 6,086 5,813 126 Medtronic Inc. 7,066 6,251 79 Micro Whse Inc. 3,419 3,845 348 Microchip Technology Inc. 12,694 14,010 158 Microsoft Corp 13,872 15,650 126 MSC Indl Direct Inc. CL A Com 3,478 2,403
16 BROWN & SHARPE SAVINGS & RETIREMENT PLAN SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT DECEMBER 31, 1995
SHARES OR FACE VALUE DESCRIPTION FAIR VALUE COST OF INVESTMENT ================================================================================================================================= 316 Nationsbank Corp 22,013 14,797 63 Network Appliance Inc. Com 2,537 1,148 126 Newbridge Networks Corp 5,233 5,252 648 Norrell Corp GA Common Stk 19,039 15,505 316 Norwest Corp 10,434 7,915 1,028 Officemax Inc. Com 22,992 16,108 1,091 Ornda Healthcorp Com Stk 25,361 16,406 237 Oxford Health Plans Inc. 17,518 12,728 111 Pacificare Health Sys Inc. 9,627 9,634 806 Paging Network Inc. 19,652 19,260 158 Parametric Technology Corp Com 10,513 5,682 411 Petiatric Svcs of America Com 6,474 6,755 237 Physicians Health Svcs Inc. 8,774 9,060 553 Platinum Technology Inc. 10,167 10,098 158 Promus Hotel Corp Com 3,517 3,246 79 Qualcomm Inc. 3,399 3,414 790 Quorum Health Group Inc. Com Stk 17,389 12,392 142 Regal Cinemas Inc. Com 4,233 3,922 490 SFX Broadcasting Inc. 14,824 14,118 237 Silicon Graphics Inc. 6,551 7,929 158 Sitel Corp Com 4,841 4,178 395 Sodak Gaming Inc. 8,151 7,863 632 Softkey Intl Inc. Com 14,623 17,747 316 Solectron Corp Com 13,951 8,435 474 Spectrian Corp Com 10,552 15,739 316 Sterling Healthcare Group Inc.. Com 3,359 4,268 47 Stratacom Inc. 3,486 3,397 379 Sun Microsystems 17,310 15,423 790 TCF Finl Corp 26,183 16,149 79 Tellabs Incorporated 2,925 3,114 632 Teradyne Common 15,888 7,644 411 Texas Instruments Com 21,168 26,540 443 Trimble Nav Ltd. 8,244 10,067 553 US Office Prods Co. Com 12,588 8,282 711 United Healthcare Corp 46,507 17,716 949 United States Filtr Corp New 25,254 16,370 474 USA Waste Svcs Inc. Com 8,952 9,383 190 Valudjet Inc. Com 4,695 3,375 364 Washington Mut Inc. Com 10,499 9,783 237 Worldcom Inc. GA Com 8,359 7,173 379 Xilinx Inc. 11,572 5,652 158 3 Com Corp 7,371 7,272 553 3-D Sys Corp Del 13,139 11,167 ---------- ---------- Total Common Equities $1,622,939 $1,216,984 Total Diversified Fund $1,845,379 $1,429,223 ========== ==========
17 BROWN & SHARPE SAVINGS & RETIREMENT PLAN SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT DECEMBER 31, 1995
SHARES OR FACE VALUE DESCRIPTION FAIR VALUE COST OF INVESTMENT =================================================================================================================================== COMPANY STOCK FUND Short-Term Investments 8,730 Fleet Money Market $ 8,730 $ 8,730 Company Common Stock 36,431.26 Brown & Sharpe Mfg Co Cl A & B $ 373,420 $ 347,071 ---------- ---------- Total Company Common Stock $ 373,420 $ 347,071 Total Company Stock Fund $ 382,150 $ 355,801 ========== ========== Guaranteed Interest Contracts Blended GIC Fleet Money Market $ 28,575 $ 28,575 A I Life GIC #18181 6.38% due 529,418 529,418 12/31/99 Principal Mutual GIC #88705-3 2,045,067 2,045,067 6.38% due 12/31/97 ---------- ---------- Total Blended GIC $2,603,060 $2,603,060 1992 GIC Fleet Money Market $ 486 $ 486 Principal Mutual GIC - 259,432 259,432 #(3)88705-02 6.80% due 12/31/96 ---------- ---------- $ 259,918 $ 259,918 1991 GIC Fleet Money Market $ 328 $ 328 Allstate Life Ins. GIC - #GA 5052 347,351 347,351 8.60% due 04/01/96 ---------- ---------- $ 347,679 $ 347,679 TOTAL GUARANTEED INTEREST CONTRACTS $3,210,657 $3,210,657 ========== ========== TOTAL INVESTMENTS $5,569,599 $5,127,094 PLAN LOANS RECEIVABLE $ 70,355 $ 70,355 ---------- ---------- TOTAL ASSETS HELD FOR INVESTMENTS $5,639,954 $5,197,449 ========== ==========
18 CONSENT OF INDEPENDENT AUDITORS We consent to the incorporation by reference in the Registration Statements (Form S-8 Nos. 2-33676, 2-56621, 2-60398, 2-77219, 2-77575, 2-83637, 2-97935, 33-17831, 33-23601, 33-23603, 33-30927, and 33-54496) of Brown & Sharpe Manufacturing Company of our report dated June 24, 1996, with respect to the financial statements and schedule of the Brown & Sharpe Savings and Retirement Plan included in this Annual Report (Form 11-K) for the year ended December 31, 1995. ERNST & YOUNG LLP Providence, Rhode Island June 24, 1996 19 -----END PRIVACY-ENHANCED MESSAGE-----