[GE LOGO OMITTED]
S&S PROGRAM
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MUTUAL FUNDS
ANNUAL REPORT &
S&SP DISCLOSURE
DOCUMENT
DECEMBER 31, 1999
<PAGE>
UNDERSTANDING YOUR REPORT
PAGE
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A LETTER FROM THE PRESIDENT ........................ 1
John Myers on market events
REVIEW OF PERFORMANCE AND SCHEDULES OF INVESTMENTS
Portfolio managers discuss your Funds' results in 1999
GE S&S PROGRAM MUTUAL FUND ...................... 3
GE S&S LONG TERM INTEREST FUND .................. 8
NOTES TO PERFORMANCE ............................... 17
NOTES TO SCHEDULES OF INVESTMENTS .................. 18
FINANCIAL STATEMENTS
Financial Highlights ............................ 19
Notes to Financial Highlights ................... 20
Statements of Assets and Liabilities,
Operations, and Changes in Net Assets ........... 21
NOTES TO FINANCIAL STATEMENTS ...................... 24
INDEPENDENT AUDITORS' REPORT ....................... 28
TAX INFORMATION .................................... 29
GE S&S PROGRAM
SUPPLEMENTARY INFORMATION .......................... 30
SCHEDULES OF INVESTMENTS
GE S&S SHORT TERM INTEREST FUND ................. 31
GE S&S MONEY MARKET FUND ........................ 33
SUPPLEMENTAL INFORMATION* .......................... 34
Illustrations of the relative market value of investments
offered under the S&S Program based on historical earnings.
DISCLOSURE STATEMENT ............................... 38
Information about the S&S Program investment alternatives.
GE S&S MUTUAL FUNDS'
INVESTMENT TEAM .................................... 52
SHAREHOLDER SERVICES ....................INSIDE BACK COVER
How you can obtain more information
* THE SUPPLEMENTAL INFORMATION PART OF THIS DOCUMENT CONSTITUTES PART OF A
PROSPECTUS COVERING SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933.
HIGHLY RATED GE S&S FUNDS
MORNINGSTAR RATINGS(TM)
THROUGH DECEMBER 31, 1999
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NUMBER
FUND OF FUNDS STAR
(CATEGORY) IN CATEGORY RATING
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GE S&S PROGRAM MUTUAL -- (Domestic Equity)
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Overall 3469 [STAR] [STAR] [STAR] [STAR]
3 year 3469 [STAR] [STAR] [STAR] [STAR]
5 year 2180 [STAR] [STAR] [STAR] [STAR]
10 year 770 [STAR] [STAR] [STAR] [STAR]
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GE S&S LONG TERM INTEREST -- (Taxable Bonds)
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Overall 1617 [STAR] [STAR] [STAR] [STAR]
3 year 1617 [STAR] [STAR] [STAR] [STAR]
5 year 1221 [STAR] [STAR] [STAR] [STAR]
10 year 387 [STAR] [STAR] [STAR] [STAR]
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Morningstar is an independent fund rating company that seeks to provide a
non-biased rating system used in making investment decisions. A fund is rated in
its broad asset class on a scale of one to five stars through the evaluation of
the historical balance of risk and return after 3 years of performance.
Morningstar proprietary ratings reflect historical risk-adjusted performance
through December 31, 1999. The ratings are subject to change every month.
Morningstar ratings are calculated from a fund's three-, five- and ten-year
average annual returns (with fee and sales charge adjustments) and a risk factor
that reflects fund performance below 90-day T-bill returns. The top ten percent
of the funds in a broad asset class receive five stars, the next 22.5% receive
four stars and the next 35% receive three stars. Ratings are for the share
classes shown only; other classes may vary.
Investment return and principal value of an investment will fluctuate and you
may have a gain or loss when you sell your shares. The adviser has voluntarily
agreed to waive and/or bear certain fees and expenses. Without these provisions,
which may be terminated in the future, the results may have been lower. Returns
assume changes in share price and reinvestment of dividends and capital gains.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
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DATA PROTECTION AND PRIVACY STATEMENT
In order to provide you with additional S&SP and general investment education
and to offer certain financial products and services to help you reach your
investment goals, information related to your participation in the S&SP may be
provided exclusively to certain GE financial services businesses. If you do not
want information relating to your participation in the S&SP to be used in this
manner, please send a letter or e-mail including your name, social security
number and the subject line "Data Protection and Privacy" to: Opt-Out, 3003
Summer Street, P.O. Box 7900, Stamford, CT 06904-7900 or
[email protected].
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<PAGE>
A LETTER FROM THE PRESIDENT
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DEAR SHAREHOLDER,
The approach of the new millennium was marked by very strong performance across
most global equity markets, while the U.S. bond market suffered its second worst
year since 1973. The S&P 500 again set a record in 1999, returning in excess of
20% for the fifth straight year. Investors' interest in U.S. equities however
was confined to a very narrow portion of the market, namely technology. The
technology sector returned over 80%, following a 76% gain in 1998, despite
anxiety surrounding Y2K. The dominance of technology is due in large part to the
increasingly pervasive use of the Internet in all aspects of business. The
unprecedented move in technology accounted for 90% of the S&P 500's 1999
performance. Interestingly, the S&P 500 excluding technology returned only 3%
for the year. Innovation and productivity gains are among the positive
by-products of the current technology cycle but, as disciplined, long-term
investors, we remain cautious about valuations. As a whole, U.S. equity markets
enjoyed a very favorable economic backdrop in 1999 including strong GDP growth,
modest wage pressure, low inflation, and high consumer confidence.
International equity markets also performed extremely well and outperformed the
S&P 500 for the first time since 1994. Most investors became convinced that the
economic troubles of Asia, Latin America, and Russia were behind us and that
sentiment provided the catalyst for positive performance across many individual
markets - European markets climbed 15.9%, Japan rose 61.5%, and emerging markets
soared 66.4%. We believe international markets will remain very attractive over
the next few years as consolidation, restructuring, and privatization trends
continue to exert economic pressures on companies to pursue shareholder value
and to find new ways to grow earnings.
The reversal of Federal Reserve policy in 1999, to tighten rates three times
after reducing rates three times in 1998, created difficulties for the bond
market. The yield on the long-bond started the year around 5% and ended 1999 at
6.5%. The steepening of the yield curve reflected a "wall of worry" by most bond
investors that the strong economy would eventually push up inflation, thereby
forcing the Fed to increase rates even more. Despite challenges in the fixed
income markets, we believe that a diversified portfolio, including bonds, is a
responsible way to invest in times of uncertainty.
PERFORMANCE HIGHLIGHTS
GE S&S Program Mutual Fund returned 19.74% and GE S&S Long-Term Interest Fund
posted a return of -0.92%. Although both funds slightly underperformed their
benchmarks in 1999, they continue to rank in the top quartile among their
respective peer groups, as rated by Lipper. In addition, the funds continue to
receive favorable Morningstar ratings as presented on the inside front cover of
this report. Average returns for each applicable Lipper category and complete
details on each fund's performance can be found on the performance review pages
included in this report.
MARKET OVERVIEW
The last five years of the 20th century produced very favorable results for
financial markets. Double-digit returns now seem to be the norm in terms of
investor expectations, given the 20%-plus returns recorded by the S&P 500 in the
last half
[PHOTO OF JOHN MYERS OMITTED]
1
<PAGE>
A LETTER FROM THE PRESIDENT (CONTINUED)
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of the 1990's. The new millennium begins with a positive backdrop for the
global markets.
The U.S. market is characterized by a "New Era Economy" with low inflation;
modest interest rates; modest wage pressure offset by very strong productivity
gains; healthy consumer spending; a new technology cycle centered around the
Internet; and robust economic growth. We believe that these factors, combined
with a favorable demographic picture over the next ten years, bode well for U.S.
company earnings and for the U.S. equity market in general. The international
markets are now embracing consolidation and restructuring in the name of
shareholder value which should translate into better earnings and stock prices
for those who can execute their strategy. The emerging markets are still
recovering from the economic woes of the Asian crisis and investors remain
confident about their prospects. The fixed income markets will continue to be
challenged by the Federal Reserve's efforts to stave off inflation and keep
economic growth manageable. The fixed income markets are anticipating several
rate hikes in 2000 to accomplish this goal. Another issue for the bond market is
the lack of supply of 30-year paper given the U.S. budget surplus. We are in new
territory in terms of paying down our national debt, which is having a unique
impact on the yield curve, namely, an inversion of the curve in which short-term
rates exceed longer-term rates. The danger could be that the equity markets
ignore this phenomenon and continue to bid stocks higher.
While the backdrop remains constructive, there are reasons to take a cautiously
optimistic approach to investing over the next couple of years. As a
disciplined, long-term investor we continue to monitor the excesses in the U.S.
equity markets including valuations, technology concentration, and the IPO
market, where capital flows are at record highs. The robust growth of the U.S.
economy, the widening U.S. trade deficit, the budget surplus, inflationary
pressures, excess global capacity, and Federal Reserve's bias toward tightening
interest rates over the short term are all factors to watch carefully as they
could create volatility in world financial markets. We continue to believe that
our bottom-up approach to security selection will enable us to differentiate our
portfolios and lead us to the winners in this new century.
Lastly, a comment on the Year 2000 issue. To date, we have not experienced any
significant disruptions to our financial or operating activities caused by
failure of these computerized systems resulting from Year 2000 issues. Still,
the impact of failures by companies, markets, or governments of countries in
which the Funds invest to address effectively the Year 2000 issue may be felt
well after January 1, 2000 and could negatively impact the Funds' performance.
In addition, the Funds could be adversely affected if the computer systems used
by GE Asset Management, its sub-advisers or external service providers do not
correctly process such date-related information.
We remain committed to a long-term investment perspective and to you, our
shareholders.
Sincerely,
[SIGNATURE]
John Myers
President and Chief Executive Officer
GE ASSET MANAGEMENT
JOHN MYERS IS A SEASONED VETERAN OF GE'S FINANCIAL COMMUNITY AND OF GE ASSET
MANAGEMENT. JOHN BEGAN HIS GE CAREER IN 1970 AFTER SERVING AS AN OFFICER IN THE
U.S. NAVY. HE PROGRESSED THROUGH SEVERAL GLOBAL FINANCIAL ASSIGNMENTS BEFORE
JOINING GE ASSET MANAGEMENT IN 1986. HE HOLDS A B.S. IN MATHEMATICS FROM WAGNER
COLLEGE, WHERE HE SERVES ON THE BOARD OF TRUSTEES.
2
<PAGE>
GE S&S PROGRAM MUTUAL FUND
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Q&A
GENE BOLTON IS RESPONSIBLE FOR THE OVERALL MANAGEMENT OF THE U.S. EQUITY
OPERATION AT GE ASSET MANAGEMENT WITH TOTAL ASSETS OF OVER $64 BILLION. HIS
RESPONSIBILITIES INCLUDE OVERSEEING THE PORTFOLIO MANAGEMENT TEAM OF THE GE S&S
PROGRAM MUTUAL FUND. GENE JOINED GE IN 1964. AFTER COMPLETING GE'S FINANCIAL
MANAGEMENT PROGRAM, HE HELD A NUMBER OF FINANCIAL AND STRATEGIC PLANNING
POSITIONS IN THE U.S. AND EUROPE. JOINING GE ASSET MANAGEMENT IN 1984 AS CHIEF
FINANCIAL OFFICER, HE MOVED TO EQUITIES AS A PORTFOLIO MANAGER IN 1986 AND WAS
NAMED TO HIS PRESENT POSITION IN 1991. GENE IS A TRUSTEE OF THE GE PENSION TRUST
AND GE'S EMPLOYEE SAVINGS PROGRAM. HE ALSO SERVES AS A TRUSTEE OF THE INVESTMENT
MANAGEMENT WORKSHOP, SPONSORED BY THE ASSOCIATION FOR INVESTMENT MANAGEMENT AND
RESEARCH. GENE IS A GRADUATE OF MUNDELEIN COLLEGE WITH A B.A. IN BUSINESS AND
MANAGEMENT.
Q. HOW DID THE GE S&S PROGRAM MUTUAL FUND PERFORM COMPARED WITH ITS BENCHMARK
AND LIPPER PEER GROUP FOR THE ONE-YEAR PERIOD ENDED DECEMBER 31, 1999?
A. The GE S&S Program Mutual Fund returned 19.74% for the one-year period ended
December 31, 1999, slightly less than the S&P 500 Index return of 21.07%. For
the same period, the fund's new Lipper peer group of 279 Large Cap Value funds
returned an average of 11.23%, ranking the fund in the top quintile (86th
percentile) among peer funds.
Q. WHY DID THE FUND UNDERPERFORM ITS BENCHMARK?
A. The stock market continued to be characterized by narrow leadership from a
small group of very large growth stocks. Despite the strong return of the
overall index, only 46% of S&P 500 stocks were up on the year while 54% actually
declined. Because many of these leadership stocks have very high valuations, we
did not own a number of them as a result of our valuation disciplines. We expect
this valuation discrepancy to correct itself at some point and the fund to make
up for its modest underperformance last year.
Q. DID THE SECTOR WEIGHTINGS OF THE FUND CHANGE?
A. In general, the sector weightings in the fund remain quite close to those of
the S&P 500 as a result of our style-neutral, broadly diversified approach. The
exception in 1999 was the Technology sector where we started the year about
21/2% below the index weight and finished about 6% underweighted. This was the
result of the addition of some very richly valued stock to the index during the
year and not the result of net selling on our part (e.g., Yahoo! and QUALCOMM).
Q. WHICH SECTORS/STOCKS HAVE PERFORMED WELL AND WHICH HAVE NOT?
A. During 1999, seven of nine sectors in the S&P 500 showed a positive return,
but only three managed to outperform the overall index. We did well in the
Consumer Cyclical sector thanks to continued outperformance by our cable
television holdings, NTL, AT&T Corp.-Liberty Media and Comcast, as well as
Interpublic Group and Catalina Marketing. We also outperformed in the Financial
sector, thanks to good stock selection as companies such as Morgan Stanley Dean
Witter, American Express and Goldman Sachs did well. Our large overweight in
Citigroup was also helpful. We also had good performance in the Capital Goods
sector, primarily because our valuation discipline kept us out of Tyco.
Technology was the sector that provided us with the greatest investment
challenge. For the full year our Technology holdings rose 80.3%, pretty much in
line with the S&P 500 Technology benchmark increase of 81.3% but, as discussed
above, we had a fairly significant underweight in the sector by the end of the
year. We did have a number of good Technology stocks such as Nortel, Analog
Devices, Cisco, Applied Materials and EMC and we plan to add to our Technology
exposure when the correction, which we believe is inevitable, occurs in this
sector.
Q. WHAT IS YOUR OUTLOOK FOR THE FUND AND HOW HAVE YOU POSITIONED THE FUND GOING
FORWARD?
A. We expect a high level of volatility in the stock market in 2000. We also
believe that the performance and valuation discrepancy between Technology stocks
and the rest of the market cannot continue indefinitely. We plan to continue our
emphasis on bottom-up fundamental research with a strong valuation discipline
and believe the fund is well positioned for good relative performance in 2000.
[PHOTO OF GENE BOLTON OMITTED]
3
<PAGE>
GE S&S PROGRAM MUTUAL FUND
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COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
[LINE GRAPH OMITTED]
GE S&S PROGRAM MUTUAL S&P 500 INDEX
'89 $10000.00 $10000.00
'90 9720.45 9684.00
'91 12560.12 12645.00
'92 13581.90 13622.00
'93 15139.55 14986.00
'94 14872.91 15180.00
'95 20341.19 20872.00
'96 25030.22 25696.00
'97 33308.87 34251.00
'98 41228.97 44080.00
'99 49367.27 53366.60
AVERAGE ANNUAL TOTAL RETURN
FOR THE PERIODS ENDED DECEMBER 31, 1999
ONE FIVE TEN
YEAR YEAR YEAR
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GE S&S Program Mutual 19.74% 27.12% 17.31%
S&P 500 Index 21.07% 28.59% 18.23%
INVESTMENT PROFILE
A Fund designed for investors who seek long-term growth of capital and
income. The Fund invests primarily in a diversified portfolio of equity
securities of U.S. companies. The Fund may also invest to a lesser extent
in foreign securities and debt securities.
*LIPPER PERFORMANCE COMPARISON
BASED ON AVERAGE ANNUAL TOTAL RETURNS
FOR THE PERIODS ENDED 12/31/99
LARGE CAP VALUE PEER GROUP
ONE FIVE TEN
YEAR YEAR YEAR
Fund's rank in peer group: ........... 41 12 7
Number of Funds in peer group: ....... 279 118 45
Peer group average total return: ..... 11.23% 22.35% 14.91%
Lipper categories in peer group: ..... LARGE CAP VALUE
* SEE NOTES TO PERFORMANCE FOR EXPLANATION OF PEER CATEGORIES.
TOP TEN LARGEST HOLDINGS
AS A PERCENTAGE OF NET ASSETS
AT DECEMBER 31, 1999
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Citigroup Inc. 3.51%
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Microsoft Corp. 2.94%
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Cisco Systems Inc. 2.93%
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Exxon Mobil Corp. 2.68%
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Intel Corp. 2.30%
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Merck & Co. Inc. 2.28%
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First Data Corp. 1.93%
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Nortel Networks Corp. 1.68%
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SBC Communications Inc. 1.65%
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Bristol-Myers Squibb Co. 1.64%
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SEE NOTES TO PERFORMANCE. PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
4
<PAGE>
SCHEDULE OF INVESTMENTS (DOLLARS IN THOUSANDS) -- DECEMBER 31, 1999
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GE S&S PROGRAM MUTUAL FUND
[PIE CHART OMITTED]
TECHNOLOGY 24.2%
FINANCIAL SERVICES 15.4%
CONSUMER 14.7%
HEALTHCARE 11.6%
UTILITIES 9.1%
ENERGY 7.3%
CAPITAL GOODS 6.6%
RETAIL TRADE 6.3%
BASIC MATERIALS 1.7%
CASH & OTHER 1.7%
TRANSPORTATION 1.4%
NUMBER
OF SHARES VALUE
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COMMON STOCK -- 98.3%
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BASIC MATERIALS -- 1.7%
Airgas Inc. ................... 204,977 $ 1,947(a)
Barrick Gold Corp. ............ 708,102 12,525
Du Pont de Nemours (E.I.) & Co. 149,074 9,820
Mead Corp. .................... 189,777 8,243
Newmont Mining Corp. .......... 782,639 19,175
PPG Industries Inc. ........... 298,148 18,653
Rayonier Inc. ................. 234,792 11,343
81,706
CAPITAL GOODS -- 6.6%
Boeing Co. .................... 126,713 5,267
Deere & Co. ................... 156,528 6,789
Dover Corp. ................... 1,460,925 66,289
Emerson Electric Co. .......... 790,011 45,327
General Dynamics Corp. ........ 171,435 9,043
Hubbell Inc. (Class B) ........ 893,842 24,357
Martin Marietta Materials Inc. 497,162 20,384
Masco Corp. ................... 342,870 8,700
Molex Inc. (Class A) .......... 827,361 37,438
Textron Inc. .................. 670,833 51,445
United Technologies Corp. ..... 469,583 30,523
Waste Management Inc. ......... 1,140,416 19,601
325,163
[ICON OMITTED] CONSUMER - CYCLICAL -- 9.8%
AT&T Corp. - Liberty Media
Group (Class A) ............ 1,080,787 61,335(a)
NUMBER
OF SHARES VALUE
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Carnival Corp. ................ 260,880 $ 12,473
Catalina Marketing Corp. ...... 242,245 28,040(a)
Comcast Corp. (Class A) ....... 1,043,518 52,763
Ford Motor Co. ................ 275,787 14,737
Gannett Inc. .................. 629,092 51,310
Harman International
Industries Inc. ............. 67,083 3,7657
Interpublic Group Cos. Inc. ... 1,061,867 61,256
Knight-Ridder Inc. ............ 327,963 19,514
McDonald's Corp. .............. 1,088,240 43,870
NTL Inc. ...................... 527,721 65,833(a)
Time Warner Inc. .............. 274,296 19,869
United Parcel Service
Inc. (Class B) .............. 121,197 8,363
Walt Disney Co. ............... 1,060,392 31,017
Xerox Corp. ................... 372,685 8,455
482,600
CONSUMER - STABLE -- 4.9%
Anheuser Busch Cos. Inc. ...... 442,869 31,388
Avon Products Inc. ............ 348,088 11,487
Bestfoods ..................... 186,248 9,790
Colgate-Palmolive Co. ......... 95,407 6,201
General Mills Inc. ............ 335,417 11,991
Gillette Co. .................. 111,806 4,605
Heinz (H.J.) Co. .............. 238,518 9,496
Pepsico Inc. .................. 1,312,383 46,262
Philip Morris Cos. Inc. ....... 299,639 6,948
Procter & Gamble Co. .......... 477,037 52,265
Ralston Purina Co. ............ 1,174,907 32,751
Sara Lee Corp. ................ 893,732 19,718
242,902
ENERGY -- 7.3%
Anadarko Petroleum Corp. ...... 219,884 7,503
Baker Hughes Inc. ............. 380,139 8,007
BP Amoco PLC ADR .............. 163,981 9,726
Burlington Resources Inc. ..... 374,176 12,371
Chevron Corp. ................. 149,074 12,913
Conoco Inc. (Class B) ......... 581,389 14,462
Exxon Mobil Corp. ............. 1,641,371 132,233
Halliburton Co. ............... 499,398 20,101
Nabors Industries Inc. ........ 186,343 5,765(a)
Royal Dutch Petroleum Co. ADR 676,796 40,904
Schlumberger Ltd. ............. 814,689 45,826
Texaco Inc. ................... 149,074 8,097
Transocean Sedco Forex Inc. ... 157,724 5,313
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See Notes to Schedules of Investments and Financial Statements.
5
<PAGE>
GE S&S PROGRAM MUTUAL FUND (DOLLARS IN THOUSANDS) -- DECEMBER 31, 1999
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NUMBER
OF SHARES VALUE
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Unocal Corp. .................. 764,004 $ 25,642
USX-Marathon Group ............ 523,250 12,918
361,781
[ICON OMITTED] FINANCIAL -- 11.6%
American Express Co. .......... 275,787 45,849
Associates First Capital
Corp. (Class A) ............. 961,527 26,382
AXA Financial Inc. ............ 368,958 12,498
Bank of America Corp. ......... 922,023 46,274
Bank of New York Inc. ......... 165,472 6,619
Chase Manhattan Corp. ......... 414,426 32,196
Citigroup Inc. ................ 3,119,001 173,299
Countrywide Credit
Industries Inc. ............. 130,440 3,294
Federal National
Mortgage Assoc. ............. 1,090,476 68,087
FleetBoston Financial Corp. ... 659,652 22,964
Goldman Sachs Group Inc. ...... 171,435 16,147
Morgan Stanley, Dean
Witter & Co. ................ 428,588 61,181
PNC Bank Corp. ................ 223,611 9,951
State Street Corp. ............ 206,617 15,096(h)
United States Bancorp. ........ 484,491 11,537
Wells Fargo & Co. ............. 576,916 23,329
574,703
[ICON OMITTED] HEALTHCARE-- 11.6%
Abbott Laboratories ........... 1,024,883 37,216
Allergan Inc. ................. 149,074 7,417
American Home Products Corp. .. 246,717 9,730
Amgen Inc. .................... 521,759 31,338(a)
Bristol-Myers Squibb Co. ...... 1,257,439 80,712
Cardinal Health Inc. .......... 1,542,916 73,867
Dentsply International Inc. ... 208,704 4,931
Eli Lilly & Co. ............... 260,880 17,349
Henry Schein Inc. ............. 383,866 5,110(a)
Johnson & Johnson ............. 641,764 59,764
Lincare Holdings Inc. ......... 406,227 14,091(a)
Merck & Co. Inc. .............. 1,680,064 112,669
Omnicare Inc. ................. 156,528 1,878
Pfizer Inc. ................... 417,407 13,540
Pharmacia & Upjohn Inc. ....... 547,847 24,653
Schering Plough Corp. ......... 641,161 27,049
Shire Pharmaceuticals
Group PLC ADR ............... 96,898 2,822(a)
Sybron International Corp. .... 559,028 13,801(a)
NUMBER
OF SHARES VALUE
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Warner-Lambert Co. ............ 100,625 $ 8,245
Watson Pharmaceuticals Inc. ... 661,143 23,677(a)
569,859
INSURANCE -- 3.8%
American International
Group Inc. .................. 490,081 52,990
Berkshire Hathaway Inc.
(Class B) ................... 14,442 26,429(a)
Chicago Title Corp. ........... 23,908 1,106
Chubb Corp. ................... 277,278 15,614
Hartford Financial Services
Group Inc. .................. 335,417 15,890
Lincoln National Corp. ........ 283,241 11,330
Loews Corp. ................... 212,430 12,892
Marsh & McLennan Cos. Inc. .... 199,759 19,114
Reliastar Financial Corp. ..... 260,880 10,223
St. Paul Cos. Inc. ............ 305,602 10,295
UnumProvident Corp. ........... 409,954 13,144
189,027
RETAIL TRADE -- 6.3%
Costco Wholesale Corp. ........ 178,461 16,285(a)
CVS Corp. ..................... 499,920 19,966
Dayton Hudson Corp. ........... 950,955 69,836
Federated Department Stores Inc. 500,192 25,291(a)
Home Depot Inc. ............... 916,805 62,858
Lowes Cos. Inc. ............... 603,750 36,074
Sears Roebuck & Co. ........... 74,062 2,254
Wal-Mart Stores Inc. .......... 1,103,148 76,255
308,819
[ICON OMITTED] TECHNOLOGY - ELECTRONICS & EQUIPMENT -- 14.7%
Analog Devices Inc. ........... 607,477 56,495(a)
Applied Materials Inc. ........ 534,430 67,706(a)
Cisco Systems Inc. ............ 1,349,120 144,524(a)
Dell Computer Corp. ........... 421,134 21,478(a)
Hewlett Packard Co. ........... 89,444 10,191
Honeywell International Inc. .. 1,165,013 67,207
Intel Corp. ................... 1,379,680 113,565
International Business
Machines Corp. .............. 354,051 38,237
Lucent Technologies Inc. ...... 521,759 39,034
Nortel Networks Corp. ......... 819,907 82,811
Pitney Bowes Inc. ............. 635,055 30,681
Sun Microsystems Inc. ......... 481,509 37,287(a)
Texas Instruments Inc. ........ 149,074 14,442
723,658
- -------------
See Notes to Schedules of Investments and Financial Statements.
6
<PAGE>
SCHEDULE OF INVESTMENTS (DOLLARS IN THOUSANDS) -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
TECHNOLOGY - SOFTWARE & SERVICES-- 9.5%
Automatic Data Processing Inc. 843,759 $ 45,458
Computer Sciences Corp. ....... 186,342 17,633(a)
EMC Corp. ..................... 734,189 80,210(a)
Equifax Inc. .................. 1,852,244 43,644
First Data Corp. .............. 1,926,876 95,019
Microsoft Corp. ............... 1,240,361 144,812(a)
Reuters Group PLC ADR ......... 52,176 4,216
Unisys Corp. .................. 1,232,789 39,372(a)
470,364
TRANSPORTATION -- 1.4%
Burlington Northern
Santa Fe Corp. .............. 894,444 21,690
Canadian Pacific Ltd. ......... 596,296 12,858
Continental Airlines Inc.
(Class B) ................... 368,958 16,372(a)
Delta Air Lines Inc. .......... 380,139 18,936
69,856
[ICON OMITTED] UTILITIES -- 9.1%
Alltel Corp. .................. 111,806 9,245
AT&T Corp. .................... 566,481 28,749
Bell Atlantic Corp. ........... 357,778 22,026
CMS Energy Corp. .............. 447,222 13,948
Duke Energy Corp. ............. 589,588 29,553
Edison International .......... 1,144,143 29,962
El Paso Energy Corp. .......... 596,296 23,144
FPL Group Inc. ................ 186,343 7,978
Global Crossing Ltd. .......... 484,491 24,224(a)
GTE Corp. ..................... 745,370 52,595
MCI WorldCom Inc. ............. 335,417 17,798(a)
New Century Energies Inc. ..... 529,213 16,075
SBC Communications Inc. ....... 1,666,647 81,249
Sprint Corp. .................. 485,981 32,713
Texas Utilities Co. ........... 231,065 8,217
U.S. WEST Inc. ................ 342,870 24,687
Vodafone AirTouch PLC ADR ..... 532,940 26,380
448,543
TOTAL COMMON STOCK
(COST $3,527,880) .......... 4,848,981
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
CONVERTIBLE BOND -- 0.0%
- --------------------------------------------------------------------------------
Ames Department Stores Inc.
(COST $352) ................ 79 $ 0(a)
TOTAL INVESTMENTS IN SECURITIES
(COST $3,528,232) .......... 4,848,981
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 1.7%
- --------------------------------------------------------------------------------
REPURCHASE AGREEMENT -- 1.7%
State Street Bank and Trust Co.
2.80% 01/03/00
(dated 12/31/99, proceeds
$81,410 collateralized by
$83,042 U.S. Treasury Bonds,
8.125%, 08/15/19)
(COST $81,410) ............. 81,410 81,410
OTHER ASSETS AND LIABILITIES,
NET 0.0% ................... 1,289
----------
NET ASSETS-- 100% ............. $4,931,680
==========
[ICON OMITTED] ICONS REPRESENT THE TOP FIVE INDUSTRY WEIGHTINGS IN THE GE S&S
PROGRAM MUTUAL FUND AT DECEMBER 31, 1999.
- --------------
See Notes to Schedules of Investments and Financial Statements.
7
<PAGE>
GE S&S LONG TERM INTEREST FUND
- --------------------------------------------------------------------------------
Q&A
ROBERT MACDOUGALL LEADS THE FIXED INCOME TEAM AT GE ASSET MANAGEMENT. ASSETS
UNDER MANAGEMENT EXCEED $29 BILLION. HIS RESPONSIBILITIES INCLUDE OVERSEEING THE
PORFOLIO MANAGEMENT OF THE GE S&S LONG TERM INTEREST FUND. BOB JOINED GE ASSET
MANAGEMENT IN 1986 AS MUTUAL FUND PORTFOLIO MANAGER, BECAME SENIOR VICE
PRESIDENT - FIXED INCOME IN 1992 AND WAS NAMED TO HIS PRESENT POSITION IN 1997.
PREVIOUSLY HE WAS WITH GE'S CORPORATE TREASURY OPERATION, MANAGING THE COMPANY'S
$2 BILLION PORTFOLIO OF MARKETABLE SECURITIES AND SUPPORTING THE TREASURER IN
DEBT MANAGEMENT AND CAPITAL STRUCTURE PLANNING. PRIOR TO THAT, BOB HELD VARIOUS
FINANCIAL MANAGEMENT POSITIONS SINCE JOINING GE IN 1973. HE HOLDS BACHELOR'S AND
MASTER'S DEGREES IN BUSINESS ADMINISTRATION FROM THE UNIVERSITY OF
MASSACHUSETTS.
Q. DESCRIBE WHAT HAPPENED IN THE FIXED INCOME MARKETS DURING 1999.
A. The U.S. bond market suffered its second worst year since 1973. Yields on
30-year Treasuries rose from 5.1% to 6.5%. Intermediate maturity bonds fared
even worse as yields rose 1.8%. The end result was price depreciation that more
than offset interest income producing a -0.83% total return for the Lehman
Brothers Aggregate Bond Index.
The global economic crisis, which prompted the Federal Reserve to ease monetary
policy 75 basis points in 1998, subsided in 1999. The pace of economic activity
remained robust and rekindled fears of inflation. Low unemployment and rising
real estate and stock market wealth buoyed consumer confidence and, in turn,
consumer spending. Concerned that tight labor markets would lead to inflationary
increases in wages, the Federal Reserve took back all of the 1998 easing in
three 25 basis point steps between June and November. Many observers believe
further tightening would have occurred had it not been for the uncertainty over
how the century date change might affect financial markets.
In terms of sectors, mortgage backed securities performed the best, returning
1.86% due primarily to their shorter average duration and higher yield.
Corporates lost 1.96%, while U.S. Treasuries and agencies declined 2.23%.
Q. HOW DID THE GE S&S LONG TERM INTEREST FUND PERFORM COMPARED TO ITS BENCHMARK
AND LIPPER PEER GROUP FOR THE ONE-YEAR PERIOD ENDED DECEMBER 31, 1999?
A. The GE S&S Long Term Interest Fund had a return of -0.92% while the Lehman
Brothers Aggregate Bond Index returned -0.83%. Our Lipper peer group of 137
Intermediate U.S. Government Bond funds posted an average return of -1.73% for
the same period.
Q. WHAT WERE THE KEY DRIVERS OF FUND PERFORMANCE?
A. The back-up in interest rates in the early part of the year cost us some
relative performance until we adjusted downward our interest rate sensitivity
(duration). On the plus side, our overweight in mortgage-backed securities and
good security selection in the corporate sector impacted returns favorably.
Q. WHAT IS YOUR OUTLOOK FOR THE BOND MARKET?
A. Until we see a slowdown in the pace of economic activity, the market is at
risk to more Fed tightenings and higher rates. Meanwhile global competition and
increasing productivity should keep a lid on inflation. Once fears of an
overheating economy subside, bond yields will look very attractive.
[PHOTO OF ROBERT MACDOUGALL OMITTED]
8
<PAGE>
GE S&S LONG TERM INTEREST FUND
- --------------------------------------------------------------------------------
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT
[LINE GRAPH OMITTED]
GE S&S LONG TERM LB AGGREGATE
'89 $10000.00 $10000.00
'90 10939.80 10895.00
'91 12693.24 12638.00
'92 13571.20 13573.00
'93 14901.80 14896.00
'94 14529.04 14462.00
'95 17192.98 17133.00
'96 17919.70 17752.00
'97 19627.54 19472.00
'98 21294.70 21161.00
'99 21098.09 20984.85
AVERAGE ANNUAL TOTAL RETURN
FOR THE PERIODS ENDED DECEMBER 31, 1999
ONE FIVE TEN
YEAR YEAR YEAR
- --------------------------------------------------------------------------------
GE S&S Long Term (0.92)% 7.75% 7.75%
LB Aggregate (0.83)% 7.73% 7.69%
INVESTMENT PROFILE
A Fund designed for investors who seek a high interest rate of return over a
long-term period consistent with the preservation of capital. The Fund
invests primarily in a diversified portfolio of investment grade debt
securities, such as U.S. Government securities, mortgage-backed securities,
asset-backed securities, corporate bonds, and money market instruments. The
Fund may also invest to a lesser extent in high yield securities and
foreign securities.
*LIPPER PERFORMANCE COMPARISON
BASED ON AVERAGE ANNUAL TOTAL RETURNS
FOR THE PERIODS ENDED 12/31/99
INTERMEDIATE U.S. TAXABLE BOND PEER GROUP
ONE FIVE TEN
YEAR YEAR YEAR
Fund's rank in peer group: ........... 33 3 1
Number of Funds in peer group: ....... 137 92 25
Peer group average total return: ..... (1.73)% 6.37% 6.47%
Lipper categories in peer group: ..... INTERMEDIATE U.S. GOVERNMENT,
INTERMEDIATE U.S. TREASURY
*SEE NOTES TO PERFORMANCE FOR EXPLANATION OF PEER CATEGORIES.
QUALITY RATINGS AS OF DECEMBER 31, 1999
- --------------------------------------------------------------------------------
PERCENT OF
MOODY'S RATINGS + NET ASSETS
- --------------------------------------------------------------------------------
Aaa 72.32%
- --------------------------------------------------------------------------------
Aa 4.31%
- --------------------------------------------------------------------------------
A 9.10%
- --------------------------------------------------------------------------------
Baa 7.48%
- --------------------------------------------------------------------------------
Ba 1.14%
- --------------------------------------------------------------------------------
Other 0.01%
- --------------------------------------------------------------------------------
+MOODY'S INVESTORS SERVICE, INC. IS A NATIONALLY RECOGNIZED STATISTICAL RATING
ORGANIZATION.
SEE NOTES TO PERFORMANCE. PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
9
<PAGE>
SCHEDULE OF INVESTMENTS (DOLLARS IN THOUSANDS) -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
GE S&S LONG TERM INTEREST FUND
[PIE CHART OMITTED]
ASSET BACKED 39.9%
CORPORATE NOTES 23.2%
U.S. TREASURIES 15.0%
FEDERAL AGENCIES 14.0%
SHORT TERM INVESTMENTS 7.9%
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Federal Home Loan Mortgage Corp.
6.22% 03/18/08 ........... $ 20,400 $ 18,838
5.125% 10/15/08 ........... 13,820 12,110
6.625% 09/15/09 ........... 12,595 12,237
43,185
Federal National Mortgage Assoc.
5.75% 04/15/03 ........... 11,680 11,344
5.125% 02/13/04 ........... 51,756 48,659
5.78% 05/05/04 ........... 15,110 14,425
6.99% 07/09/07 ........... 14,870 14,377
5.64% 12/10/08 ........... 13,365 11,967
6.04% 02/25/09 ........... 42,555 38,964
6.16% 08/07/28 ........... 25,090 21,973
6.00% 02/01/29 - 10/01/29 33,721 30,846
192,555
Small Business Administration
6.55% 10/01/17 - 12/01/17 7,940 7,566
6.125% 01/01/18 ........... 14,445 13,423
20,989
TOTAL FEDERAL AGENCIES
(COST $380,749) ............ 362,694
AGENCY MORTGAGE BACKED -- 30.7%
Federal Home Loan Mortgage Corp.
8.00% 05/01/27 ........... 16,472 16,631
6.50% 06/01/29 - 09/01/29 76,953 72,553
7.50% 11/01/09 ........... 2,796 2,821
7.50% 06/01/10 ........... 15,543 15,684
7.50% 09/01/12 ........... 7,837 7,896
9.00% 05/01/16 - 11/01/16 3,025 3,132
8.00% 08/01/24 ........... 1,417 1,433
8.00% 10/01/25 ........... 730 738
8.00% 11/01/26 ........... 968 978
8.00% 02/01/28 ........... 1,087 1,098
6.50% 04/01/29 - 05/01/29 23,247 21,918
6.00% TBA ................ 49,000 44,850(c)
6.50% TBA ................ 11,912 11,231(c)
7.00% TBA ................ 132,835 128,559(c)
329,522
Federal National Mortgage Assoc.
6.50% 01/01/04 ........... 892 883
6.13% 12/17/04 ........... 5,979 6,009(d)
9.00% 02/01/09 - 06/01/09 8,346 8,747
7.50% 12/01/09 ........... 29,049 29,231
9.00% 05/01/10 ........... 16 16
7.00% 08/01/13 ........... 3,379 3,342
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
BONDS AND NOTES -- 96.2%
- --------------------------------------------------------------------------------
U.S. TREASURIES -- 15.0%
U.S. Treasury Bonds
8.125% 08/15/19 ........... $102,410 $116,699(j)
5.25% 02/15/29 ........... 8,920 7,376(j)
6.125% 08/15/29 ........... 33,830 32,249(i)
156,324
U.S. Treasury Notes
5.25% 05/31/01 ........... 24,564 24,249(j)
5.875% 11/30/01 ........... 26,265 26,097(i)
6.625% 03/31/02 ........... 10,720 10,794(j)
5.875% 11/15/04 ........... 33,340 32,689
7.00% 07/15/06 ........... 39,690 40,651(j)
6.00% 08/15/09 ........... 43,590 42,228(i)
176,708
U.S. Treasury STRIPS
6.83% 08/15/11 ........... 74,019 33,716(d,j)
6.84% 02/15/12 ........... 46,285 20,357(d,j)
54,073
TOTAL U.S. TREASURIES
(COST $406,085) ............ 387,105
FEDERAL AGENCIES -- 14.0%
Federal Home Loan Bank
5.625% 03/19/01 ........... 15,760 15,590
5.875% 08/15/01 ........... 59,715 59,174
5.25% 04/25/02 ........... 17,735 17,200
5.75% 04/15/08 ........... 15,210 14,001
105,965
- ------------
See Notes to Schedules of Investments and Financial Statements.
10
<PAGE>
SCHEDULE OF INVESTMENTS (DOLLARS IN THOUSANDS) -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
9.00% 09/01/13 ............$ 457 $ 473
9.00% 01/01/14 - 08/01/14 . 3,390 3,535
7.50% 02/01/14 ............ 18,922 19,040
9.00% 05/01/15 - 12/01/15 . 126 130
9.00% 04/01/16 - 10/01/16 . 4,518 4,754
9.00% 01/01/17 - 12/01/17 . 6,348 6,616
8.00% 12/01/17 ............ 7,605 7,728
9.00% 03/01/18 - 05/01/18 . 181 189
7.50% 12/01/18 ............ 4,025 4,006
9.00% 02/01/19 - 09/01/19 . 2,139 2,232
9.00% 02/01/21 - 06/01/21 . 135 141
9.00% 03/01/22 - 12/01/22 . 7,408 7,728(g)
7.50% 12/01/23 ............ 17,044 16,938
7.00% 08/01/27 - 12/01/27 . 70,062 67,793
7.00% 01/01/28 - 07/01/28 . 12,167 11,765
6.50% 01/01/29 - 03/01/29 . 43,859 41,323
6.50% TBA ................. 40,483 39,065(c)
281,684
Government National Mortgage Assoc.
7.00% 03/15/12 ............ 23,392 23,151
9.00% 11/15/16 ............ 8,338 8,797
9.00% 01/15/17 ............ 2,460 2,593
8.50% 10/15/17 ............ 8,782 9,101
9.00% 11/15/17 ............ 7,691 8,102
9.00% 04/15/18 - 11/15/18 . 1,401 1,475
9.00% 07/15/19 - 12/15/19 . 3,013 3,169
6.375% 05/20/21 ............ 12 12(e)
6.125% 11/20/21 ............ 13 13(e)
9.00% 12/15/21 ............ 1,259 1,325
7.50% 02/15/22 - 11/15/22 . 5,745 5,709
6.75% 08/20/23 - 09/20/23 . 240 241(e)
7.50% 11/15/23 ............ 906 901
6.375% 01/20/24 - 04/20/24 . 333 333(e)
6.50% 01/15/24 - 12/15/24 . 19,168 18,173
6.75% 09/20/24 ............ 117 118(e)
6.125% 10/20/24 - 11/20/24 . 120 117(e)
6.125% 10/20/25 ............ 187 185(e)
7.00% 03/15/26 - 05/15/26 . 1,848 1,787
7.00% 01/15/27 - 12/15/27 . 7,462 7,214
6.50% 08/15/27 - 11/15/27 . 134 127
7.50% 12/15/27 ............ 661 654
7.00% 01/15/28 - 04/15/28 . 12,889 12,447
7.50% 01/15/28 - 10/15/28 . 41,400 40,966
7.50% 02/15/28 ............ 162 161(b)
6.50% 03/15/28 - 04/15/28 . 27,708 26,001
8.00% TBA ................. 8,921 9,010(c)
181,882
TOTAL AGENCY MORTGAGE BACKED
(COST $815,926) ............. 793,088
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS -- 1.7%
Collateralized Mortgage Obligation Trust
5.72% 09/01/15 ............ $ 987 $ 875(d,f)
5.73% 11/01/18 ............ 3,460 2,500(d,f)
3,375
Federal Home Loan Mortgage Corp.
8.00% 04/15/20 ............ 3,218 3,242
5.75% 06/15/23 ............ 6,335 5,988
9,230
Federal National Mortgage Assoc.
14.34% 04/01/17 ............ 2,679 727(d,g)
8.50% 01/01/18 ............ 483 129(g)
6.00% 03/25/19 ............ 18,507 16,673
7.00% 06/18/20 ............ 1,413 1,408(b)
8.00% 10/25/20 ............ 3,239 3,261
9.00% 05/25/22 ............ 3,061 870(g)
8.50% 07/25/22 ............ 5,636 1,551(g)
24,619
Federal National Mortgage Assoc. REMIC
6.171% 05/25/14 ............ 3,354 3,238
8.50% 03/01/17 ............ 1,327 354(g)
6.24% 12/25/22 ............ 3,031 2,189(d,f)
5,781
TOTAL AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS
(COST $47,044) .............. 43,005
ASSET BACKED -- 4.1%
Advanta Mortgage Loan Trust Corp.
6.30% 07/25/25 ............ 2,072 2,031
Chase Credit Card Master Trust
6.00% 08/15/05 ............ 2,569 2,498
Citibank Credit Card Master Trust I
5.75% 01/15/03 ............ 829 821
5.50% 02/15/06 ............ 5,544 5,232
Discover Card Master Trust I
6.552% 08/18/03 ............ 8,260 8,257
5.75% 10/16/03 ............ 4,097 4,037
5.30% 08/15/04 ............ 3,291 3,181
5.60% 05/16/06 ............ 9,599 9,119
Ford Credit Auto Loan Master Trust
5.50% 02/15/03 ............ 2,323 2,290
- ---------------
See Notes to Schedules of Investments and Financial Statements.
11
<PAGE>
GE S&S LONG TERM INTEREST FUND (DOLLARS IN THOUSANDS) -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Ford Credit Auto Owner Trust
5.90% 06/15/02 ............. $5,072 $ 5,028
6.65% 10/15/03 ............. 1,000 973
5.80% 01/12/09 ............. 5,040 4,467
Green Tree Financial Corp.
6.90% 04/15/18 ............. 2,959 2,941
6.97% 04/01/31 ............. 3,387 3,362
MBNA Master Credit Card Trust
6.60% 04/16/07 ............. 5,123 5,037
MBNA Master Credit Card Trust II
6.632% 03/15/03 ............. 29,000 29,027
6.722% 10/15/03 ............. 4,750 4,763
6.687% 03/15/04 ............. 5,280 5,293
Peco Energy Transport Trust
5.80% 03/01/07 ............. 2,665 2,529
6.05% 03/01/09 ............. 2,665 2,500
West Penn Funding LLC Transition Bonds
6.81% 09/25/08 ............. 2,475 2,458
TOTAL ASSET BACKED
(COST $107,783) .............. 105,844
CORPORATE NOTES -- 23.2%
Abbey National PLC
7.95% 10/26/29 ............. 3,955 3,939
6.70% 06/29/49 ............. 8,360 7,539
7.35% 10/29/49 ............. 3,088 2,939(d)
Aetna Services Inc.
6.97% 08/15/36 ............. 3,695 3,620
Allstate Corp.
7.20% 12/01/09 ............. 3,350 3,257
Amerada Hess Corp.
7.875% 10/01/29 ............. 5,350 5,218
American Airlines Inc.
6.855% 04/15/09 ............. 3,355 3,296
Armstrong World Industries Inc.
7.45% 05/15/29 ............. 3,200 2,840
Associates Corporation of North America
6.375% 10/15/02 ............. 6,700 6,589
5.75% 11/01/03 ............. 2,740 2,613
AT&T Capital Corp.
6.60% 05/15/05 ............. 2,600 2,500
AT&T Corp.
6.50% 03/15/29 ............. 5,130 4,395
B.F. Goodrich Co.
6.45% 04/15/08 ............. 2,150 1,970
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Bank One Corp.
6.40% 08/01/02 ............. $5,995 $5,893
BCI US Funding Trust I
9.39% 12/29/49 ............. 3,400 3,128(b,d)
Beckman Instruments Inc.
7.10% 03/04/03 ............. 2,510 2,402
Bell Telephone Co. - Pennsylvania
8.35% 12/15/30 ............. 6,514 7,055
Bellsouth Telecomm Inc.
6.375% 06/01/28 ............. 5,075 4,274
Boston University
7.625% 07/15/97 ............. 5,755 5,391
Brascan Ltd.
7.375% 10/01/02 ............. 1,900 1,863
Bristol-Myers Squibb Co.
6.875% 08/01/97 ............. 2,650 2,368
CIT Group Inc.
7.125% 10/15/04 ............. 5,630 5,582
Cleveland Electric Co. Toledo Edison
7.19% 07/01/00 ............. 2,550 2,547
Coastal Corp.
6.375% 02/01/09 ............. 3,880 3,534
Columbia University Trustees New York
6.83% 12/15/20 ............. 4,000 3,755
Conseco Inc.
6.40% 06/15/01 ............. 5,000 4,848
8.70% 11/15/26 ............. 4,144 3,699
Continental Cablevision Inc.
8.50% 09/15/01 ............. 5,825 5,936
Corporacion Andina De Fomento
6.75% 03/15/05 ............. 4,465 4,238
Crown Cork & Seal Co. Inc.
8.00% 04/15/23 ............. 3,325 3,060
CSX Corp.
6.25% 10/15/08 ............. 5,275 4,773
DaimlerChrysler AG
7.20% 09/01/09 ............. 4,915 4,828
Delphi Automotive Systems Corp.
6.125% 05/01/04 ............. 3,645 3,448
Dresdner Funding Trust I
8.151% 06/30/31 ............. 2,745 2,575(b)
Du Pont de Nemours (E.I.) & Co.
6.75% 10/15/04 ............. 2,235 2,206
6.875% 10/15/09 ............. 2,235 2,165
- ------------
See Notes to Schedules of Investments and Financial Statements.
12
<PAGE>
SCHEDULE OF INVESTMENTS (DOLLARS IN THOUSANDS) -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Duke Capital Corp.
7.25% 10/01/04 .............. $5,635 $5,514
Duke Energy Corp.
5.375% 01/01/09 .............. 3,900 3,373
Electronic Data Systems Corp.
6.85% 10/15/04 .............. 2,175 2,145
7.45% 10/15/29 .............. 850 824
Empresa Nacional De Electricidad
8.125% 02/01/97 .............. 5,000 4,048
EOP Operating LP
6.50% 01/15/04 .............. 3,630 3,462
FDX Corp.
7.85% 01/30/15 .............. 3,132 3,068
Federated Department Stores Inc.
6.125% 09/01/01 .............. 3,830 3,764
Ford Motor Credit Co.
6.70% 07/16/04 .............. 4,175 4,086
7.375% 10/28/09 .............. 8,080 7,977
7.45% 07/16/31 .............. 4,400 4,233
Fortune Brands Inc.
7.125% 11/01/04 .............. 3,125 3,103(b)
FPL Group Capital Inc.
7.375% 06/01/09 .............. 2,800 2,751
Fred Meyer Inc.
7.375% 03/01/05 .............. 2,670 2,623
Fujian International Trust
& Investment Corp.
7.375% 08/25/07 .............. 1,030 381(b)
General Motors Acceptance Corp.
5.75% 11/10/03 .............. 2,690 2,561
6.15% 04/05/07 .............. 3,730 3,476
Georgia-Pacific Group
9.95% 06/15/02 .............. 2,530 2,669
Goldman Sachs Group L.P.
6.65% 05/15/09 .............. 2,150 2,001
Greenpoint Bank
6.70% 07/15/02 .............. 4,600 4,491
Guangdong International Trust
& Investment Corp.
8.75% 10/24/16 .............. 2,660 133(a,b,k)
HCR Manor Care
7.50% 06/15/06 .............. 2,265 1,992
Heritage Media Corp.
8.75% 02/15/06 .............. 6,415 6,591
Household Finance Corp.
6.125% 07/15/12 .............. 1,915 1,864
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Hydro-Quebec
8.05% 07/07/24 .............. $5,418 $5,722
8.25% 04/15/26 .............. 3,680 3,835
Israel Electric Corp. Ltd.
7.125% 07/15/05 .............. 2,295 2,197(b)
8.10% 12/15/96 .............. 4,545 3,818(b)
J.P. Morgan & Co.
6.00% 01/15/09 .............. 5,180 4,635
Korea Development Bank
6.625% 11/21/03 .............. 5,045 4,844
Kroger Co.
6.34% 06/01/01 .............. 2,142 2,120
LCI International Inc.
7.25% 06/15/07 .............. 4,060 3,904
Lehman Brothers Holdings Inc.
8.50% 08/01/15 .............. 5,425 5,540
7.50% 08/01/26 .............. 5,995 6,011
LG&E Capital Corp.
5.75% 11/01/01 .............. 4,790 4,685(b)
Liberty Property Ltd. Partnership
7.50% 01/15/18 .............. 1,530 1,298
Lockheed Martin Corp.
7.95% 12/01/05 .............. 5,665 5,583
8.20% 12/01/09 .............. 3,360 3,343
8.50% 12/01/29 .............. 2,240 2,277
Lumbermens Mutual Casualty
8.30% 12/01/37 .............. 2,760 2,361(b)
MBNA Corp.
6.306% 04/22/03 .............. 3,250 3,134
MCI WorldCom Inc.
6.125% 04/15/02 .............. 5,550 5,460
6.40% 08/15/05 .............. 4,300 4,119
8.875% 01/15/06 .............. 4,600 4,828
Meditrust
7.114% 08/15/04 .............. 5,070 3,803
Merita Bank Ltd.
7.15% 12/29/49 .............. 5,375 5,194(b)
Merrill Lynch & Co. Inc.
5.71% 01/15/02 .............. 6,400 6,249
Monsanto Co.
5.75% 12/01/05 .............. 3,350 3,083(d)
6.60% 12/01/28 .............. 1,355 1,165(b)
Morgan Stanley Dean Witter & Co.
7.125% 01/15/03 .............. 6,540 6,535
5.625% 01/20/04 .............. 6,000 5,651
Nabisco Inc.
6.125% 02/01/33 .............. 4,510 4,305
- ----------
See Notes to Schedules of Investments and Financial Statements.
13
<PAGE>
GE S&S LONG TERM INTEREST FUND (DOLLARS IN THOUSANDS) -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Natexis AMBS Co. LLC
8.44% 12/29/49 .............. $4,140 $3,902(b)
National Rural Utilities Cooperative
6.046% 04/15/03 .............. 3,000 2,902
5.50% 01/15/05 .............. 3,375 3,142
National Westminster Bank PLC
7.75% 04/29/49 .............. 4,654 4,472
New Jersey Economic Development Authority
7.425% 02/15/29 .............. 3,755 3,661
Newell Co.
6.35% 07/15/08 .............. 7,015 6,496
News America Holdings Inc.
8.15% 10/17/36 .............. 4,983 4,763
News America Inc.
7.625% 11/30/28 .............. 4,010 3,716
Noram Energy Corp.
6.375% 11/01/03 .............. 3,370 3,244
North Atlantic Energy Corp.
9.05% 06/01/02 .............. 4,820 4,885
Northrop-Grumman Corp.
8.625% 10/15/04 .............. 3,130 3,234
Occidental Petroleum Corp.
7.375% 11/15/08 .............. 3,325 3,238
Ontario Province of Canada
7.375% 01/27/03 .............. 5,580 5,638
Pepsi Bottling Holdings Inc.
5.375% 02/17/04 .............. 6,000 5,624(b)
5.625% 02/17/09 .............. 2,900 2,555(b)
Philip Morris Cos. Inc.
7.25% 09/15/01 .............. 3,260 3,237
7.20% 02/01/07 .............. 3,770 3,530
Phillips Petroleum Co.
9.375% 02/15/11 .............. 4,145 4,693
Pitney Bowes Credit Corp.
9.25% 06/15/08 .............. 3,900 4,336
Principal Financial Group
8.20% 08/15/09 .............. 3,055 3,108(b)
Procter & Gamble Co.
6.875% 09/15/09 .............. 2,650 2,589
9.36% 01/01/21 .............. 4,260 4,916
Quebec Province of Canada
7.50% 09/15/29 .............. 3,470 3,364
Raytheon Co.
6.75% 08/15/07 .............. 4,130 3,853
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Rohm & Haas Co.
6.95% 07/15/04 .............. $2,180 $2,151
7.85% 07/15/29 .............. 2,240 2,247
Royal & Sun Alliance
Insurance Group PLC
8.95% 10/15/29 .............. 4,325 4,417(b)
Safeway Inc.
7.50% 09/15/09 .............. 3,355 3,289
Sprint Capital Corp.
5.70% 11/15/03 .............. 2,925 2,775
6.875% 11/15/28 .............. 3,760 3,342
St. George Funding Co.
8.485% 12/29/49 .............. 5,830 4,790(b)
Stop & Shop Cos. Inc.
9.75% 02/01/02 .............. 2,525 2,651
SunAmerica Inc.
5.60% 07/31/97 .............. 8,380 5,763
Suntrust Bank Inc.
6.00% 01/15/28 .............. 3,760 3,433
Tele-Communications Inc.
9.80% 02/01/12 .............. 4,715 5,509
7.875% 08/01/13 .............. 2,500 2,538
Teleglobe Canada Inc.
7.20% 07/20/09 .............. 2,810 2,639
Tenet Healthcare Corp.
7.875% 01/15/03 .............. 5,055 4,903
Texas Utilities Co.
5.94% 10/15/01 .............. 6,215 6,109
Textron Inc.
6.375% 07/15/04 .............. 3,310 3,192
Time Warner Entertainment
Co. L.P.
10.15% 05/01/12 .............. 6,438 7,543
Time Warner Pass-Through
Asset Trust
6.10% 12/30/01 .............. 4,100 4,019(b)
Tosco Corp.
7.625% 05/15/06 .............. 2,240 2,213
Transamerica Capital
7.625% 11/15/37 .............. 6,800 6,204
TRW Inc.
6.625% 06/01/04 .............. 4,150 3,995
Turner Broadcasting Systems Inc.
8.375% 07/01/13 .............. 4,650 4,816
TXU Eastern Funding Co.
6.45% 05/15/05 .............. 6,050 5,723
6.75% 05/15/09 .............. 2,600 2,383
- ------------
See Notes to Schedules of Investments and Financial Statements.
14
<PAGE>
SCHEDULE OF INVESTMENTS (DOLLARS IN THOUSANDS) -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Tyco International Group S.A.
6.25% 06/15/03 ............. $1,030 $ 989
7.00% 06/15/28 ............. 3,905 3,379
U.S. West Capital Funding Inc.
6.875% 08/15/01 ............. 5,140 5,093(b)
6.125% 07/15/02 ............. 1,595 1,556
6.875% 07/15/28 ............. 2,450 2,143
Union Carbide Corp.
6.79% 06/01/25 ............. 3,825 3,683
Union Oil Co. of California
7.35% 06/15/09 ............. 2,630 2,559
United Illuminating Co.
6.25% 12/15/02 ............. 1,300 1,253
United Parcel Service Inc.
8.375% 04/01/30 ............. 3,300 3,524
US Airways Pass Through Trust
8.36% 07/20/20 ............. 3,315 3,236
US West Communications Inc.
5.625% 11/15/08 ............. 3,695 3,233
USA Networks Inc.
6.75% 11/15/05 ............. 3,490 3,276
USA Waste Services Inc.
6.125% 07/15/01 ............. 2,000 1,903(d)
USX Marathon Group
9.80% 07/01/01 ............. 3,790 3,920
Viacom Inc.
7.75% 06/01/05 ............. 9,650 9,713
Wal-Mart Stores Inc.
6.875% 08/10/09 ............. 5,800 5,647
Walt Disney Co.
5.62% 12/01/08 ............. 3,035 2,682
Westinghouse Electric Corp.
8.875% 06/01/01 ............. 2,000 2,045
Williams Cos. Inc.
6.125% 02/15/12 ............. 7,265 7,099
Yale University
7.375% 04/15/96 ............. 7,539 7,136
TOTAL CORPORATE NOTES
(COST $631,296) .............. 598,923
NON-AGENCY MORTGAGE BACKED SECURITIES -- 6.2%
Amresco Commercial Mortgage Funding Corp.
6.73% 06/17/29 ............. 4,535 4,481
Asset Securitization Corp.
6.50% 02/14/41 ............. 2,725 2,681
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Chase Commercial Mortgage Securities Corp.
6.39% 11/18/08 ............$ 8,979 $ 8,362
Commercial Mortgage Acceptance Corp.
6.49% 05/15/08 ............ 4,836 4,529
Credit Suisse First Boston
Mortgage Securities Corp.
6.30% 11/15/08 ............ 4,883 4,506
DLJ Commercial Mortgage Corp.
6.24% 11/12/31 ............ 12,530 11,520(d)
DLJ Mortgage Acceptance Corp.
6.65% 12/17/27 ............ 2,742 2,705(b)
First Union Commercial
Mortgage Trust
6.07% 10/15/08 ............ 6,943 6,329
First Union Lehman Brothers
- Bank of America
6.56% 11/18/08 ............ 1,620 1,525
First Union-Chase Commercial Mortgage
6.65% 04/15/09 ............ 7,377 6,969
GMAC Commercial Mortgage
Security Inc.
6.42% 08/15/08 ............ 3,885 3,620
6.27% 08/15/23 ............ 91,838 3,559(d)
GS Mortgage Securities Corp.
7.75% 05/19/27 ............ 2,382 2,237(b)
6.86% 07/13/30 ............ 8,178 8,088
Lehman Large Loan
6.79% 06/12/04 ............ 4,502 4,451
Merrill Lynch Mortgage
Investors Inc.
6.39% 02/15/30 ............ 5,488 5,145
Mid-State Trust
7.54% 07/01/35 ............ 2,187 2,058
Morgan Stanley Capital Inc.
6.86% 05/15/06 ............ 7,341 7,245(b)
6.52% 01/15/08 ............ 1,295 1,224
6.21% 09/15/08 ............ 2,981 2,751
9.82% 10/15/18 ............ 69,659 3,320(b,d)
9.74% 04/15/23 ............ 44,654 1,786(d)
6.01% 11/15/30 ............ 5,754 5,470
6.48% 11/15/30 ............ 5,007 4,705
Nationslink Funding Corp.
6.001% 11/20/07 ............ 3,534 3,361
6.476% 07/20/08 ............ 5,596 5,259
- --------------
See Notes to Schedules of Investments and Financial Statements.
15
<PAGE>
GE S&S LONG TERM INTEREST FUND (DOLLARS IN THOUSANDS) -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Sawgrass Finance REMIC Trust
6.45% 01/20/06 ............. $10,944 $ 10,924
Structured Asset Securities Corp.
8.389% 04/25/27 ............. 9,504 9,789
7.21% 02/25/28 ............. 45,691 2,342(d)
Vornado Finance Corp.
6.36% 12/01/00 ............. 20,814 20,749(b)
TOTAL NON-AGENCY MORTGAGE BACKED SECURITIES
(COST $167,415) .............. 161,690
NON-AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS -- 1.3%
BlackRock Capital Finance
7.22% 11/25/28 ............. 16,758 15,988(b)
7.25% 11/25/28 ............. 9,973 5,685(b)
Salomon Brothers Mortgage Securities Inc.
7.00% 07/25/24 ............. 14,228 12,316
TOTAL NON-AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS
(COST $40,377) ............... 33,989
TOTAL BONDS AND NOTES
(COST $2,596,675) ............ 2,486,338
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
PREFERRED STOCK -- 0.5%
Centaur Funding Corp.
(Series B), 9.08% ............ 5,135 $ 5,187(b)
Home Ownership Funding, 13.331% . 6,270 4,981(b)
TCI Communications Inc., 10.00% . 148,000 3,820
TOTAL PREFERRED STOCK
(COST $14,412) ............... 13,988
TOTAL INVESTMENTS IN SECURITIES
(COST $2,611,087) ............ 2,500,326
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENT -- 15.6%
- --------------------------------------------------------------------------------
GEI Short Term Investment Fund .. 197,814 197,814
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Federal Farm Credit Bank
4.75% 01/13/00 ............. $75,000 74,881(d)
Federal Home Loan Mortgage Corp.
5.79% 01/11/00 ............. 69,851 69,747(d)
4.76% 01/14/00 ............. 22,000 21,962(d)
91,709
International Bank for
Reconstruction & Development
5.76% 01/12/00 ............. 37,000 36,937(d)
TOTAL SHORT TERM INVESTMENTS
(COST $401,341) .............. 401,341
OTHER ASSETS AND LIABILITIES,
NET (12.3)% ................. (316,873)
----------
NET ASSETS-- 100% ............... $2,584,794
==========
- ------------
See Notes to Schedules of Investments and Financial Statements.
16
<PAGE>
NOTES TO PERFORMANCE (UNAUDITED)
- --------------------------------------------------------------------------------
Information on the preceding performance pages is unaudited.
Total returns take into account changes in share price and assume reinvestment
of dividends and capital gains, if any. Investment returns and net asset value
on an investment will fluctuate and you may have a loss or gain when you sell
your shares.
The Standard & Poor's ("S&P") Composite Index of 500 stocks (S&P 500 Index) and
the Lehman Brothers Aggregate Bond Index (LB Aggregate) are unmanaged indices
and do not reflect the actual cost of investing in the instruments that comprise
each index. The S&P 500 Index is a composite of the prices of 500 widely held
stocks recognized by investors to be representative of the stock market in
general. LB Aggregate is a composite index of short-, medium-, and long-term
bond performance and is widely recognized as a barometer of the bond market in
general. The majority of the broad market returns is not available from the
Funds' commencement of investment operations through December 31, 1999. The
results shown for the foregoing indices assume the reinvestment of net dividends
or interest and are unaudited.
The peer universe of funds used in our peer ranking calculation is based on the
blend of Lipper peer categories, as shown. This blend is the same as the
category blend used by the Wall Street Journal. The actual number of funds and
numerical rankings in the Lipper and Wall Street Journal universes could differ
since the Wall Street Journal excludes certain funds which do not meet their net
asset or number of shareholder publication thresholds. Lipper is an independent
mutual fund rating service.
The views expressed in this document reflect our judgment as of the publication
date and are subject to change at any time without notice. The securities cited
may not represent future holdings and should not be considered as a
recommendation to purchase or sell a particular security. See the GE S&S Program
Disclosure Statement for a description of investment objectives, policies, risks
and permissible investments.
17
<PAGE>
NOTES TO SCHEDULES OF INVESTMENTS (DOLLARS IN THOUSANDS) -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
(a) Non-income producing security.
(b) Pursuant to Rule 144A of the Securities Act of 1933, these securities may be
resold in transactions exempt from registration, normally to qualified
institutional buyers. At December 31, 1999, these securities amounted to
$131,914 or 5.1% of net assets for the GE S&S Long Term Interest Fund. These
securities have been determined to be liquid using guidelines established by
the Trustees.
(c) Settlement is on a delayed delivery or when-issued basis with final maturity
to be announced (TBA) in the future.
(d) Rate represents effective yield.
(e) Floating rate coupon. The stated rate represents the rate at December 31,
1999.
(f) Principal only securities represent the right to receive the monthly
principal payments on an underlying pool of mortgages. No payments of
interest on the pool are passed through to the "principal only" holder.
(g) Interest only securities represent the right to receive the monthly interest
payments on an underlying pool of mortgages. Payments of principal on the
pool reduce the value of the "interest only" holding.
(h) State Street Corp. is the parent company of State Street Bank & Trust Co.,
the fund's custodian.
(i) All or a portion of security out on loan.
(j) At December 31, 1999 all or a portion of this security was pledged to cover
collateral requirements for futures, options, or TBA's.
(k) At December 31, 1999, the security is in default. General Electric
Investment Corporation has determined that the security is illiquid as it
may be difficult to resell within seven days in the ordinary course of
business at approximately the price it is valued. The cost of the security
was $2,762 and represents 0.00% of net assets of the GE S&S Long Term
Interest Fund.
ABBREVIATIONS:
ADR -- American Depositary Receipt
REMIC -- Real Estate Mortgage Investment Conduit
STRIPS -- Separate Trading of Registered Interest and Principal
of Securities
18
<PAGE>
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
SELECTED DATA BASED ON A SHARE OUTSTANDING THROUGHOUT THE PERIOD(S) INDICATED
<TABLE>
<CAPTION>
GE S&S PROGRAM MUTUAL FUND 1999 1998 1997 1996 1995
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year ................ $57.43 $53.06 $45.54 $41.19 $33.59
INCOME (LOSS) FROM INVESTMENT OPERATIONS:
Net investment income .......................... 0.75 0.87 0.87 0.97 1.00
Net realized and unrealized
gains (losses) on investments ............... 10.46 11.77 14.04 8.63 11.33
- -----------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM
INVESTMENT OPERATIONS .......................... 11.21 12.64 14.91 9.60 12.33
- -----------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income .......................... 0.75 0.87 0.87 0.96 1.00
Net realized gains ............................. 13.34 7.40 6.52 4.29 3.73
- -----------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS ............................... 14.09 8.27 7.39 5.25 4.73
- -----------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD .................... $54.55 $57.43 $53.06 $45.54 $41.19
- -----------------------------------------------------------------------------------------------------------------------
TOTAL RETURN(A) ................................... 19.74% 23.78% 33.07% 23.05% 36.77%
RATIOS / SUPPLEMENTAL DATA:
Net assets, end of year
(in thousands) .............................$4,931,680 $4,353,884 $3,658,804 $2,790,830 $2,314,537
Ratios to average net assets:
Net investment income ...................... 1.17% 1.46% 1.60% 2.10% 2.48%
Expenses ................................... 0.09% 0.09% 0.08% 0.12% 0.12%
Portfolio turnover rate ....................... 49% 32% 31% 36% 47%
</TABLE>
- -----------
See Notes to Financial Statements.
19
<PAGE>
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
SELECTED DATA BASED ON A SHARE OUTSTANDING THROUGHOUT THE PERIOD(S) INDICATED
<TABLE>
<CAPTION>
GE S&S LONG TERM INTEREST FUND 1999 1998 1997 1996 1995
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year ............ $11.53 $11.55 $11.28 $11.59 $10.52
INCOME (LOSS) FROM INVESTMENT OPERATIONS:
Net investment income ...................... 0.70 0.74 0.76 0.77 0.80
Net realized and unrealized
gains (losses) on investments ........... (0.80) 0.21 0.27 (0.31) 1.07
- -----------------------------------------------------------------------------------------------------------------------
TOTAL INCOME (LOSS) FROM
INVESTMENT OPERATIONS ...................... (0.10) 0.95 1.03 0.46 1.87
- -----------------------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS FROM:
Net investment income ...................... 0.70 0.76 0.76 0.77 0.80
Net realized gains ......................... 0.03 0.21 0.00 0.00 0.00
- -----------------------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS ........................... 0.73 0.97 0.76 0.77 0.80
- -----------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD ................ $10.70 $11.53 $11.55 $11.28 $11.59
- -----------------------------------------------------------------------------------------------------------------------
TOTAL RETURN(A) ............................... (0.92)% 8.49% 9.53% 4.23% 18.34%
RATIOS / SUPPLEMENTAL DATA:
Net assets, end of period
(in thousands) ............................. $2,584,794 $2,964,131 $2,818,779 $2,842,343 $3,096,022
Ratios to average net assets:
Net investment income ................... 6.35% 6.30% 6.70% 6.87% 7.18%
Expenses ................................ 0.13% 0.09% 0.11% 0.13% 0.11%
Portfolio turnover rate .................... 201% 225% 218% 194% 314%
<FN>
- ------------
NOTES TO FINANCIAL HIGHLIGHTS
(a) TOTAL RETURNS ARE HISTORICAL AND ASSUME CHANGES IN SHARE PRICE AND
REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS, AND ASSUME NO SALES CHARGE.
</FN>
</TABLE>
- ------------
See Notes to Financial Statements.
20
<PAGE>
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1999 (AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
GE S&S PROGRAM GE S&S LONG TERM
MUTUAL FUND INTEREST FUND
- -------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Investments in securities, at market
(Cost $3,528,232 and $2,611,087, respectively) .......... $ 4,848,981 $ 2,500,326
Short term investments (at amortized cost) ................. 81,410 401,341
Cash ....................................................... 32 --
Receivable for investments sold ............................ -- 106,131
Income receivables ......................................... 3,886 34,930
Receivable for fund shares sold ............................ 578 79
- -------------------------------------------------------------------------------------------------
TOTAL ASSETS ............................................ 4,934,887 3,042,807
- -------------------------------------------------------------------------------------------------
LIABILITIES
Distributions payable to shareholders ...................... 4 2,540
Payable upon return of securities loaned ................... -- 104,588
Payable for investments purchased .......................... -- 343,397
Payable for fund shares redeemed ........................... 1,320 5,546
Payable to General Electric Investment Corporation.......... 1,883 1,942
- -------------------------------------------------------------------------------------------------
TOTAL LIABILITIES ....................................... 3,207 458,013
- -------------------------------------------------------------------------------------------------
NET ASSETS .................................................... $ 4,931,680 $ 2,584,794
- -------------------------------------------------------------------------------------------------
NET ASSETS CONSIST OF:
Capital paid in ............................................ 3,610,960 2,751,051
Undistributed net investment income ........................ 519 2,158
Accumulated net realized gain (loss) ....................... (548) (57,654)
Net unrealized appreciation on:
Investments ............................................. 1,320,749 (110,761)
Written options ......................................... -- --
Foreign currency related transactions ................... -- --
- -------------------------------------------------------------------------------------------------
NET ASSETS .................................................... $ 4,931,680 $ 2,584,794
- -------------------------------------------------------------------------------------------------
Shares outstanding ($25.00 and $10.00 par value, respectively) 90,408 241,581
Net asset value per share ..................................... $ 54.55 $ 10.70
</TABLE>
- -------------
See Notes to Financial Statements.
21
<PAGE>
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1999 (AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
GE S&S PROGRAM GE S&S LONG TERM
MUTUAL FUND INTEREST FUND
- -----------------------------------------------------------------------------------------
INVESTMENT INCOME
INCOME:
<S> <C> <C>
Dividends ...................................... $ 55,011 $ 2,641
Interest ....................................... 4,547 177,456*
Less: Foreign taxes withheld ................... (273) --
- -------------------------------------------------------------------------------------------
TOTAL INCOME ...................................... 59,285 180,097
- -------------------------------------------------------------------------------------------
EXPENSES:
Advisory and Administration expenses ........... 2,659 1,781
Shareholder servicing agent expenses ........... 507 504
Transfer agent fees ............................ 591 720
Custody and accounting expenses ................ 419 296
Professional fees .............................. 129 94
Registration, filing, printing and
miscellaneous expenses ....................... 121 102
- -------------------------------------------------------------------------------------------
TOTAL EXPENSES .................................... 4,426 3,497
- -------------------------------------------------------------------------------------------
NET INVESTMENT INCOME ............................. 54,859 176,600
- -------------------------------------------------------------------------------------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
REALIZED GAIN (LOSS) ON:
Investments .................................... 973,917 (59,299)
Written options ................................ -- 2,647
Foreign currency related transactions .......... (25) --
INCREASE (DECREASE) IN UNREALIZED APPRECIATION/
DEPRECIATION ON:
Investments .................................... (189,407) (144,709)
Written options ................................ -- (38)
Foreign currency related transactions .......... (4) --
- -------------------------------------------------------------------------------------------
Net realized and unrealized gain
(loss) on investments .......................... 784,481 (201,399)
- -------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS ...................... $ 839,340 $ (24,799)
- -------------------------------------------------------------------------------------------
<FN>
* Income attributable to security lending activity, net of rebate expenses, for
the S&S Long term Interest Fund was $2,680.
</FN>
</TABLE>
- ------------
See Notes to Financial Statements.
22
<PAGE>
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998 (AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
GE S&S PROGRAM GE S&S LONG TERM
MUTUAL FUND INTEREST FUND
- -------------------------------------------------------------------------------------------------------
1999 1998 1999 1998
- -------------------------------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS:
<S> <C> <C> <C> <C>
Net investment income .................... $ 54,859 $ 58,158 $ 176,600 $ 180,662
Net realized gain on investments,
futures, written options and
foreign currency related transactions . 973,892 494,247 (56,652) 69,770
Net increase (decrease) in unrealized
appreciation/depreciation ............. (189,411) 297,148 (144,747) (19,668)
- -------------------------------------------------------------------------------------------------------
Net increase (decrease) from operations .. 839,340 849,553 (24,799) 230,764
- -------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income .................... (54,903) (58,284) (175,968) (186,009)
Net realized gains ....................... (972,262) (493,417) (6,134) (53,358)
- -------------------------------------------------------------------------------------------------------
TOTAL DISTRIBUTIONS ......................... (1,027,165) (551,701) (182,102) (239,367)
- -------------------------------------------------------------------------------------------------------
Increase (decrease) in net assets from
operations and distributions ............. (187,825) 297,852 (206,901) (8,603)
- -------------------------------------------------------------------------------------------------------
SHARE TRANSACTIONS:
Proceeds from sale of shares ............. 408,425 310,232 539,852 327,552
Value of distributions reinvested ........ 937,984 505,407 177,615 224,491
Cost of shares redeemed .................. (580,788) (418,411) (889,903) (398,088)
- -------------------------------------------------------------------------------------------------------
Net increase (decrease) from
share transactions ....................... 765,621 397,228 (172,436) 153,955
- -------------------------------------------------------------------------------------------------------
TOTAL INCREASE (DECREASE) IN NET ASSETS ..... 577,796 695,080 (379,337) 145,352
NET ASSETS
Beginning of year ........................... 4,353,884 3,658,804 2,964,131 2,818,779
- -------------------------------------------------------------------------------------------------------
End of year ................................. $4,931,680 $4,353,884 $ 2,584,794 $ 2,964,131
- -------------------------------------------------------------------------------------------------------
UNDISTRIBUTED NET INVESTMENT
INCOME, END OF YEAR ......................... $ 519 $ 588 $ 2,158 $ 1,526
CHANGES IN FUND SHARES
- -------------------------------------------------------------------------------------------------------
Shares sold .................................... 6,530 5,321 48,877 28,060
Issued for distributions reinvested ............ 17,351 8,776 16,060 19,327
Shares redeemed ................................ (9,289) (7,234) (80,525) (34,188)
- -------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN FUND SHARES ......... 14,592 6,863 (15,588) 13,199
- -------------------------------------------------------------------------------------------------------
</TABLE>
- -----------
See Notes to Financial Statements.
23
<PAGE>
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
1. ORGANIZATION OF THE FUNDS
The GE S&S Program Mutual Fund and GE S&S Long Term Interest Fund (each a "Fund"
and collectively the "Funds") are registered under the Investment Company Act of
1940, as amended, (the "1940 Act") as open-end management investment companies.
The Funds are two of the investment options offered under the GE Savings &
Security Program ("Program"). The Program, through a trust, owns 59% of the GE
S&S Program Mutual Fund and 71% of the GE S&S Long Term Interest Fund. The Funds
operate as Employees' Securities Companies (as defined in the 1940 Act) and as
such are exempt from certain provisions of the 1940 Act.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make certain estimates and
assumptions at the date of the financial statements. Actual results may differ
from those estimates. The following summarizes the significant accounting
policies of the Funds:
SECURITY VALUATION AND TRANSACTIONS
Securities for which exchange (or NASDAQ) quotations are readily available are
valued at the last sale price that day, or if no sales occurred on that day, at
the last quoted bid price. Certain fixed income securities are valued by a
dealer or by a pricing service based upon a computerized matrix system, which
considers market transactions and dealer supplied valuations. Short-term
investments maturing within 60 days are valued at amortized cost or original
cost plus accrued interest both of which approximate current value. Fund
positions that cannot be valued as set forth above are valued at fair value
determined in good faith under procedures approved by the Board of Trustees of
the Funds. Security transactions are accounted for as of the trade date.
Realized gains or losses on investments sold are recorded on the basis of
specific identified cost for both financial statement and federal tax purposes.
REPURCHASE AGREEMENTS
Each of the Funds may enter into repurchase agreements. The Funds' custodian
takes possession of the collateral pledged for investments in repurchase
agreements on behalf of the Funds. The Funds value the underlying collateral
daily on a mark-to-market basis to determine that the value, including accrued
interest, is at least equal to 102% of the repurchase price. In the event the
seller defaults and the value of the security declines, or if the seller enters
an insolvency proceeding, realization of the collateral by the Funds may be
delayed or limited.
SECURITY LENDING
Each of the Funds may loan securities to brokers, dealers, and financial
institutions determined by General Electric Investment Corporation to be
creditworthy, subject to certain limitations. The Funds receive compensation in
the form of fees in addition to the interest and dividends on the loaned
securities during the term of the loan. The loans of securities are secured by
collateral in the form of cash or other liquid assets, which are segregated and
maintained with the custodian in an amount at least equal to 102% of the current
market value of the loaned securities. During the term of the loan, the Funds
will receive any gain or loss in the market value of its loaned securities and
of securities in which cash collateral is invested net of any rebate. In the
event the counterparty (borrower) does not meet its contracted obligation to
return the securities, the Fund may be exposed to the risk of loss of
reacquiring the loaned securities at prevailing market prices using proceeds of
the sale of the collateral.
FOREIGN CURRENCY
Accounting records of the Funds are maintained in U.S. dollars. Investment
securities and other assets and liabilities denominated in a foreign currency
are translated daily to U.S. dollars at the prevailing rates of exchange.
Purchases and sales of securities, income receipts and expense payments are
translated into U.S. dollars at the prevailing exchange rate on the respective
dates of the transactions. The Funds do not isolate the portion of the results
of operations resulting from changes in foreign exchange rates on investments
from the fluctuations arising from changes in their market prices. Such
fluctuations are included in net realized or unrealized gain or loss from
investments. Net realized gains or losses on foreign currency transactions
represent net gains or losses on sales and maturities of foreign currency
contracts, disposition
24
<PAGE>
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
of foreign currencies, the difference between the amount of net investment
income and withholding taxes accrued and the U.S. dollar amount actually
received and paid and gains or losses between the trade and settlement date on
purchases and sales of securities. Net unrealized foreign exchange gains and
losses arising from changes in the value of other assets and liabilities as a
result of changes in foreign exchange rates are included as increases or
decreases in unrealized appreciation/depreciation on foreign currency related
transactions.
FINANCIAL FUTURES CONTRACTS AND OPTIONS
The GE S&S Long Term Interest Fund may invest in financial futures contracts and
purchase and write options, subject to certain limitations. The Fund may invest
in futures and options contracts to manage their exposure to the stock and bond
markets and fluctuations in currency values. Buying futures, writing puts and
buying calls tend to increase a Fund's exposure to the underlying instrument.
Selling futures, buying puts and writing calls tend to decrease a Fund's
exposure to the underlying instrument, or hedge other fund investments. The
Fund's risks in using these contracts include changes in the value of the
underlying instruments, nonperformance of the counterparties under the
contracts' terms and changes in the liquidity of secondary market for the
contracts. Futures contracts are valued at the settlement price established each
day by the board of trade or exchange on which they principally trade. Options
are valued at the last sale price, or if no sales occurred on that day, at the
last quoted bid price. Upon entering into a financial futures contract, the
Funds are required to pledge to the broker an amount of cash and/or other assets
equal to a certain percentage of the contract amount, known as initial margin
deposit. Subsequent payments, known as variation margins, are made or received
by the Funds each day, depending on the daily fluctuation in the fair value of
the underlying security. The Funds record an unrealized gain or loss equal to
the daily variation margin. Should market conditions move unexpectedly, the Fund
may not achieve the anticipated benefits of the financial futures contracts and
may incur a loss. The Funds recognize a realized gain or loss on the expiration
or closing of a futures contract. When a Fund writes an option, the amount of
the premium received is recorded as a liability and is subsequently adjusted to
the current fair value of the option written. Premiums received from writing
options that expire unexercised are treated by the Funds on the expiration date
as realized gains from investments. The difference between the premium and the
amount paid on effecting a closing purchase transaction, including brokerage
commissions, is also treated as a realized gain, or if the premium is less than
the amount paid for the closing purchase, as a realized loss. When an option is
exercised, the proceeds from the sale of the underlying security or the cost
basis of the securities purchased is adjusted by the original premium received
or paid.
WHEN-ISSUED SECURITIES AND FORWARD COMMITMENTS
Each of the Funds may purchase or sell securities on a when-issued or forward
commitment basis. These transactions are arrangements in which the Funds
purchase and sell securities with payment and delivery scheduled a month or more
after entering into the transaction. The price of the underlying securities and
the date when these securities will be delivered and paid for are fixed at the
time the transaction is negotiated. Losses may arise due to changes in the
market value of the underlying securities or if the counterparty does not
perform under the contract. In connection with such purchases, the Funds
maintain cash or liquid assets in an amount equal to purchase commitments for
such underlying securities until settlement date and for sales commitments the
Funds maintain equivalent deliverable securities as "cover" for the transaction.
Unsettled commitments are valued at current market value of the underlying
security. Daily fluctuations in the value of such contracts are recorded as
unrealized gains or losses. The Funds will not enter into such agreements for
the purpose of investment leverage.
FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
The GE S&S Long Term Interest Fund may enter into forward foreign currency
exchange contracts to facilitate transactions in foreign denominated securities
and to manage the Fund's currency exposure. Forward foreign currency exchange
contracts are valued at the mean between the bid and offered forward rates as
last quoted by a recognized dealer. The aggregate principal amounts of the
contracts are not recorded in the Fund's financial statements. Such amounts, if
any, appear under the caption forward foreign currency contracts in the Schedule
of Investments. Fluctuations in the value of the contracts are recorded in the
Statement of Assets and Liabilities
25
<PAGE>
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
as an asset (or liability) and in the Statement of Operations as unrealized
appreciation (depreciation) until the contracts are closed, when they are
recorded as realized foreign currency related transactions gains or losses. The
Fund's risks in using these contracts include changes in the value of foreign
currency or the possibility that the counterparties do not perform under the
contracts' terms. Certain Funds may utilize forward currency exchange contracts
for speculative purposes. When a Fund enters into a forward foreign currency
exchange contract for speculative purposes, it is required to segregate cash or
liquid securities with its custodian in an amount equal to the value of the
Fund's total assets committed to the consummation of the forward contract. If
the value of the segregated securities declines, additional cash or securities
is segregated so that the value of the account will equal the amount of the
Fund's commitment with respect to the contract.
INCOME TAXES
(DOLLARS IN THOUSANDS)
The Funds intend to comply with all sections of the Internal Revenue Code
applicable to regulated investment companies including the distribution of
substantially all of their taxable net investment income and net realized
capital gains to their shareholders. Therefore, no provision for federal income
tax has been made. Each Fund is treated as a separate taxpayer for federal
income tax purposes. As of December 31, 1999, the following Fund had a capital
loss carryover as indicated below. The capital loss carryover is available to
offset future realized capital gains to the extent provided in the Internal
Revenue Code and regulations thereunder. To the extent that this carryover loss
is used to offset future capital gains, it is probable that the gains so offset
will not be distributed to shareholders because they would be taxable as
ordinary income.
FUND AMOUNT EXPIRES
- -------------------------------------------------------------
GE S&S Long Term Interest Fund $43,584 2007
Any net capital and currency losses incurred after October 31, within each
Fund's tax year, are deemed to arise on the first day of the Fund's next tax
year if the Fund so elects to defer such losses. The Fund below incurred and
elected to defer losses at October 31, 1999 as follows:
FUND CURRENCY CAPITAL
- ----------------------------------------------------------
GE S&S Long Term Interest Fund $ -- $12,806
DISTRIBUTIONS TO SHAREHOLDERS
GE S&S Long Term Interest Fund declares investment income dividends daily and
pays them monthly. The GE S&S Program Mutual Fund declares and pays dividends
from investment income annually. The Funds declare and pay net realized capital
gains in excess of capital loss carryforwards distributions annually. The
character of income and gains to be distributed is determined in accordance with
income tax regulations which may differ from generally accepted accounting
principles. These differences include treatment of realized and unrealized gains
and losses on forward foreign currency contracts, paydown gains and losses on
mortgage-backed securities, and losses deferred due to wash sale transactions.
Reclassifications are made to the Funds' capital accounts to reflect income and
gains available for distribution (or available capital loss carryovers) under
income tax regulations. These reclassifications have no impact on net investment
income, net realized gains or losses, or net asset value of the Funds. The
calculation of net investment income per share in the Financial Highlights table
excludes these adjustments.
INVESTMENT INCOME
Corporate actions (including cash dividends) are recorded, net of
non-reclaimable tax withholdings, on the ex-dividend date, except for certain
foreign securities for which corporate actions are recorded as soon after
ex-dividend date as such information becomes available. Interest income is
recorded on the accrual basis. All premiums and discounts on taxable bonds are
amortized to call or maturity date, whichever is shorter, using the effective
yield method.
EXPENSES
Expenses of the Funds which are directly identifiable to a specific Fund are
allocated to that Fund. Expenses which are not directly identifiable to a
specific Fund are allocated in such a manner as deemed equitable, taking into
consideration the nature and type of expense and the relative sizes of the
Funds. All expenses of the Funds are paid by the Funds' investment adviser and
reimbursed by the Funds.
26
<PAGE>
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
3. LINE OF CREDIT
Effective December 1999, the Funds share a revolving credit facility, of up to
$188,000,000, with a number of its affiliated mutual funds. The credit facility
is with its custodial bank, State Street Bank and Trust Company. The revolving
credit facility requires the payment of a commitment fee equal to 0.08% per
annum on the daily unused portion of the credit facility, payable quarterly. The
portion borne by the Funds generally is borne proportionately based upon net
assets. Generally, borrowings under the credit facility would accrue interest at
the Federal Fund Rate plus 50 basis points and is borne by the borrowing Fund.
The maximum amount allowed to be borrowed by any one Fund is the lesser of its
Disclosure Statement limitation, 20% of its net assets or $75 million. The
credit facility was not utilized by the Funds during the period ended December
31, 1999.
4. SECURITY LENDING
(DOLLARS IN THOUSANDS)
At December 31, 1999, the GE S&S Long Term Interest Fund, which is the only fund
that participated in securities lending, loaned securities having a value,
including accrued interest, of approximately $102,905 and received $104,588 and
$1,375 in cash and letters of credit, respectively, as collateral for loans.
5. FEES AND COMPENSATION PAID TO AFFILIATES
ADVISORY AND ADMINISTRATION FEES
During 1999, the Funds incurred expenses for the cost of services rendered by
General Electric Company's wholly-owned subsidiary, General Electric Investment
Corporation, as investment adviser and for services it rendered as shareholder
servicing agent. These expenses are included as administrative expenses and
shareholder servicing agent fees in the Statements of Operations. The Trustees
received no compensation as trustees for the Funds.
6. AGGREGATE UNREALIZED APPRECIATION AND DEPRECIATION
(DOLLARS IN THOUSANDS)
Aggregate gross unrealized appreciation/(depreciation) of investments for each
Fund at December 31, 1999, were as follows:
NET
GROSS GROSS UNREALIZED
UNREALIZED UNREALIZED APPRECIATION
APPRECIATION DEPRECIATION (DEPRECIATION)
- --------------------------------------------------------------
GE S&S Program
Mutual Fund $1,532,032 $211,283 $1,320,749
GE S&S Long Term
Interest Fund 2,880 113,641 (110,761)
The aggregate cost of each Fund's investments was substantially the same for
book and federal income tax purposes at December 31, 1999.
7. OPTIONS
(CONTRACTS AND DOLLARS IN THOUSANDS)
During the year ended December 31, 1999, the following option contracts were
written:
GE S&S LONG TERM INTEREST FUND
------------------------------
NUMBER
OF CONTRACTS PREMIUM
- --------------------------------------------------------
Balance as of
December 31, 1998 85,610 $ 355
Written 1,123,824 3,322
Closed and Expired (975,389) (2,907)
Exercised (234,045) (770)
- --------------------------------------------------------
Balance as of
December 31, 1999 -- $ --
- --------------------------------------------------------
8. INVESTMENT TRANSACTIONS
(DOLLARS IN THOUSANDS)
The cost of purchases and the proceeds from sales of investments, other than
short-term securities and options, for the year ended December 31, 1999, were as
follows:
PURCHASES SALES
- ----------------------------------------------------------
GE S&S Program
Mutual Fund $2,225,813 $2,380,807
GE S&S Long Term
Interest Fund 5,522,645 5,617,279
27
<PAGE>
INDEPENDENT AUDITORS' REPORT
- --------------------------------------------------------------------------------
[KPMG LLP LOGO OMITTED]
THE BOARD OF TRUSTEES AND SHAREHOLDERS OF THE GE S&S MUTUAL FUNDS:
We have audited the accompanying statements of assets and liabilities of the GE
S&S Program Mutual Fund and GE S&S Long Term Interest Fund (the "Funds"),
including the schedules of investments, as of December 31, 1999, and the related
statements of operations for the year then ended, the statements of changes in
net assets for each of the years in the two-year period then ended, and the
financial highlights for each of the years in the five-year period then ended.
These financial statements and financial highlights are the responsibility of
the Funds' management. Our responsibility is to express an opinion on these
financial statements and financial highlights 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 and financial
highlights are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
December 31, 1999, by correspondence with the custodian. As to securities
purchased or sold but not yet received or delivered, we performed other
appropriate auditing procedures. 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 and financial highlights referred to
above present fairly, in all material respects, the financial position of GE S&S
Program Mutual Fund and GE S&S Long Term Interest Fund as of December 31, 1999,
the results of their operations for the year then ended, the changes in their
net assets for each of the years in the two-year period then ended, and their
financial highlights for each of the years in the five-year period then ended,
in conformity with generally accepted accounting principles.
KPMG LLP
New York, New York
February 4, 2000
28
<PAGE>
TAX INFORMATION, UNAUDITED
- --------------------------------------------------------------------------------
During the year ended December 31, 1999, the following GE S&S Funds paid to
shareholders of record on December 27, 1999 the following long-term capital gain
dividends:
FUND PER SHARE AMOUNT
- ----------------------------------------------------------------------
GE S&S Program Mutual Fund $12.80822
GE S&S Long Term Interest Fund $ 0.00453
29
<PAGE>
GE S&S PROGRAM SUPPLEMENTARY INFORMATION -- INTRODUCTION
- --------------------------------------------------------------------------------
(UNAUDITED)
The following information is provided for participants in the GE Savings &
Security Program and supplements the description of the Program as it appears in
the GE Employee Benefits Summary Plan Description booklet, as amended (GE
Benefits Handbook).
The Schedules of Investments for the GE S&S Short Term Interest Fund and GE
S&SMoney Market Fund have been included as an additional feature.
Following the Schedules of Investments are two tables designed to illustrate the
relative market value of investments offered under the Program. Performance data
information is based upon historical earnings and is not intended to indicate
future performance. The notes are an integral part of these tables.
The Supplemental Information and Schedules of Investments have not been audited.
30
<PAGE>
SCHEDULE OF INVESTMENTS (DOLLARS IN THOUSANDS) -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
GE S&S SHORT TERM INTEREST FUND
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
BONDS AND NOTES -- 99.7%
- --------------------------------------------------------------------------------
U.S. TREASURIES -- 34.5%
U.S. Treasury Notes
4.875% 03/31/01 ............ $29,715 $ 29,255
5.25% 05/31/01 ............ 1,263 1,247
5.75% 06/30/01 ............ 32,300 32,093
5.50% 07/31/01 ............ 9,450 9,348
5.625% 09/30/01 ............ 47,800 47,322
5.875% 10/31/01 - 11/30/01 . 73,795 73,333
6.625% 03/31/02 ............ 36,271 36,520
6.50% 05/31/02 ............ 20,000 20,097
5.875% 09/30/02 ............ 33,450 33,110
5.75% 11/30/02 ............ 15,637 15,407
TOTAL U.S. TREASURIES
(COST $301,978) ............. 297,732
FEDERAL AGENCIES -- 14.9%
Federal Home Loan Bank
5.625% 03/19/01 ............ 15,155 14,991
6.00% 11/15/01 ............ 51,025 50,427
5.25% 04/25/02 ............ 39,500 38,309
103,727
Federal National Mortgage Assoc.
9.00% 03/01/11 ............ 24,197 25,045
TOTAL FEDERAL AGENCIES
(COST $130,754) ............. 128,772
AGENCY MORTGAGE BACKED -- 19.7%
Federal Home Loan Mortgage Corp.
8.00% 08/01/03 ............ 6,671 6,733
5.929% 05/25/06 ............ 6,816 6,729
7.50% 12/01/06 ............ 1,024 1,026
6.00% 12/01/08 ............ 603 586
15,074
Federal National Mortgage Assoc.
5.625% 03/15/01 ............ 69,641 68,999
6.00% 05/01/01 ............ 134 132
6.59% 09/01/02 ............ 9,191 9,111
6.554% 09/17/04 ............ 1,027 1,026
7.11% 11/17/06 ............ 2,743 2,734
9.00% 08/01/10 ............ 10,953 11,473
7.00% 06/18/20 ............ 432 430(b)
93,905
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Federal National Mortgage Assoc. REMIC
9.04% 11/25/06 ............ $ 56 $ 56(d,f)
6.171% 05/25/14 ............ 11,199 10,811
10,867
Government National Mortgage Assoc.
9.00% 08/15/09 - 12/15/09 . 27,229 28,467(j)
9.50% 12/15/09 ............ 19,972 21,296(j)
49,763
TOTAL AGENCY MORTGAGE BACKED
(COST $172,601) ............. 169,609
AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS -- 0.0%
Federal Home Loan Mortgage Corp. REMIC
33.73% 09/15/05 ............ 8 50(g)
30.66% 07/15/06 ............ 16 198(g)
TOTAL AGENCY COLLATERALIZED MORTGAGE OBLIGATIONS
(COST $12) .................. 248
ASSET BACKED -- 15.1%
Advanta Mortgage Loan Trust Corp.
6.30% 07/25/25 ............ 1,976 1,937
American Express Master Trust
5.375% 07/15/01 ............ 4,208 4,174
AT&T Universal Card Master Trust
5.95% 10/17/02 ............ 14,290 14,223
Capital Asset Research Funding L.P.
6.40% 12/15/04 ............ 1,449 1,441
Capital Auto Receivables Asset
5.58% 06/15/02 ............ 2,000 1,958
Carco Auto Loan Master Trust
5.65% 03/15/03 ............ 9,734 9,627
Chemical Master Credit Card Trust I
5.55% 09/15/03 ............ 12,650 12,500
CIT RV Trust
5.78% 07/15/08 ............ 9,740 9,548
Citibank Credit Card Master Trust I
5.85% 04/10/03 ............ 4,700 4,646
Discover Card Master Trust I
5.80% 09/16/03 ............ 7,000 6,930
5.75% 10/16/03 ............ 9,688 9,546
5.30% 08/15/04 ............ 9,689 9,365
5.90% 10/15/04 ............ 9,734 9,506
Green Tree Financial Corp.
6.90% 04/15/18 ............ 4,188 4,163
MBNA Master Credit Card Trust
6.723% 10/15/03 ............ 3,000 3,008
Premier Auto Trust
5.77% 01/06/02 ............ 9,750 9,723(d)
5.78% 04/08/03 ............ 9,300 9,117
6.27% 04/08/03 ............ 6,977 6,931
- -------------
See Notes to Schedules of Investments (which are unaudited for the purposes of
this fund).
31
<PAGE>
GE S&S SHORT TERM INTEREST FUND (DOLLARS IN THOUSANDS) -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
(UNAUDITED)
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Provident Bank Home Equity Loan Trust
7.18% 04/21/13 .............. $2,330 $ 2,294
TOTAL ASSET BACKED
(COST $132,907) ............... 130,637
CORPORATE NOTES -- 12.9%
Bank One Corp.
6.40% 08/01/02 .............. 2,900 2,851
California Infrastructure
6.16% 06/25/03 .............. 9,734 9,682
Carnival Corp.
5.65% 10/15/00 .............. 4,000 3,963
Cleveland Electric Co. Toledo Edison
7.19% 07/01/00 .............. 5,805 5,798
Conseco Inc.
6.40% 06/15/01 .............. 3,480 3,374
Electronic Data Systems Corp.
6.85% 05/15/00 .............. 3,000 3,007(b)
Federated Department Stores Inc.
6.125% 09/01/01 .............. 4,480 4,403
Fleet Credit Card LLC
6.45% 10/30/00 .............. 9,750 9,716
Ford Motor Credit Corp.
5.65% 10/15/01 .............. 5,374 5,363(d)
6.50% 02/28/02 .............. 6,000 5,937
Georgia-Pacific Group
9.95% 06/15/02 .............. 1,545 1,630
Korea Development Bank
9.60% 12/01/00 .............. 3,000 3,049
Kroger Co.
6.34% 06/01/01 .............. 1,930 1,910
LG&E Capital Corp.
5.75% 11/01/01 .............. 1,525 1,491(b)
MCI WorldCom Inc.
6.125% 08/15/01 .............. 4,950 4,897
Merrill Lynch & Co.
5.71% 01/15/02 .............. 4,575 4,467
Monsanto Co.
5.375% 12/01/01 .............. 9,175 8,915(b)
Morgan Stanley Dean Witter & Co.
7.125% 01/15/03 .............. 4,400 4,397
Niagara Mohawk Power Corp.
9.50% 06/01/00 .............. 2,000 2,022
Petroleos Mexicanos
7.60% 06/15/00 .............. 4,000 3,997(b)
Raytheon Co.
5.95% 03/15/01 .............. 3,750 3,689
PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
Time Warner Pass-Through Asset Trust
6.10% 12/30/01 .............$ 2,140 $ 2,098(b)
Tyco International Ltd.
6.50% 11/01/01 ............. 8,725 8,588
US West Capital Funding Inc.
6.875% 08/15/01 ............. 1,700 1,684(b)
USA Waste Services Inc.
6.125% 07/15/01 ............. 4,000 3,807
Westinghouse Electric Corp.
8.875% 06/01/01 ............. 900 920
TOTAL CORPORATE NOTES
(COST $113,342) .............. 111,655
NON-AGENCY MORTGAGE BACKED SECURITIES -- 2.6%
Asset Securitization Corp.
6.50% 02/14/41 ............. 10,660 10,487
DLJ Mortgage Acceptance Corp.
6.783% 02/08/00 ............. 613 613(b)
GS Mortgage Securities Corp.
6.94% 07/13/30 ............. 8,239 8,171
Lehman FHA Title I Loan Trust
7.30% 05/25/17 ............. 902 901
Vornado Finance Corp.
6.36% 12/01/00 ............. 2,000 1,994(b)
TOTAL NON-AGENCY MORTGAGE BACKED SECURITIES
(COST $22,638) ............... 22,166
TOTAL INVESTMENTS IN SECURITIES
(COST $874,232) .............. 860,819
NUMBER
OF SHARES VALUE
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 0.2%
- --------------------------------------------------------------------------------
GEI Short Term Investment Fund
(COST $1,636) ................ 1,636 1,636
OTHER ASSETS AND LIABILITIES, NET 0.1% 830
--------
NET ASSETS-- 100% ............... $863,285
========
- --------------
See Notes to Schedules of Investments (which are unaudited for the purposes of
this fund).
32
<PAGE>
SCHEDULE OF INVESTMENTS (DOLLARS IN THOUSANDS) -- DECEMBER 31, 1999
- --------------------------------------------------------------------------------
GE S&S MONEY MARKET FUND
PRINCIPAL AMORTIZED
AMOUNT COST
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS -- 102.2%
- --------------------------------------------------------------------------------
U.S. GOVERNMENTS -- 33.5%
U.S. AGENCIES
Federal Agricultural Mortgage Corp.
5.65% 01/18/00 ............. $11,955 $11,924
Federal Farm Credit Bank
5.58% 02/22/00 ............. 21,592 21,423
Federal Home Loan Bank
5.55% 02/04/00 ............. 67,000 66,653
5.64% 02/23/00 ............. 74,690 74,078
5.60% 02/25/00 ............. 50,000 49,584
5.59% 03/15/00 ............. 12,950 12,804
5.75% 04/12/00 ............. 53,000 52,162
5.64% 05/05/00 ............. 25,170 24,690
279,971
Federal Home Loan Mortgage Corp.
5.35% 01/21/00 ............. 54,898 54,739
5.32% 01/27/00 ............. 5,700 5,679
5.37% 04/13/00 ............. 5,600 5,516
65,934
Federal National Mortgage Assoc.
5.67% 01/21/00 ............. 23,992 23,918
5.68% 02/07/00 ............. 4,000 3,977
5.75% 04/10/00 ............. 51,128 50,334
5.62% 04/17/00 ............. 79,330 78,037
156,266
U.S. TREASURIES
U.S. Treasury Notes
5.29% 03/31/00 ............. 20,410 20,419
5.59% 05/31/00 ............. 32,300 32,385
5.60% 06/30/00 ............. 34,270 34,314
87,118
TOTAL U.S. GOVERNMENTS
(COST $622,636) .............. 622,636
COMMERCIAL PAPER -- 42.4%
Abbey National PLC
5.89% 02/29/00 ............. 68,450 67,799
Bank of America
6.11% 01/07/00 ............. 69,570 69,500
Bank of Nova Scotia
6.01% 03/15/00 ............. 78,650 77,695
Credit Suisse
6.03% 01/10/00 ............. 65,350 65,253
PRINCIPAL AMORTIZED
AMOUNT COST
- --------------------------------------------------------------------------------
Deutsche Bank AG
6.08% 01/14/00 .............$ 82,000 $ 82,000
First Union Corp.
6.00% 01/31/00 ............. 69,370 69,023
Halifax Building Society
6.87% 02/22/00 ............. 84,730 84,023
Merrill Lynch & Co. Inc.
5.92% 02/04/00 ............. 96,820 96,285
Morgan (J.P.) & Co. Inc.
6.07% 01/14/00 ............. 66,000 65,858
Morgan Stanley Dean Witter
6.02% 01/12/00 ............. 69,500 69,374
UBS Finance Delaware Inc.
6.03% 03/30/00 ............. 860 847
World Bank
5.54% 01/31/00 ............. 42,500 42,306
TOTAL COMMERCIAL PAPER
(COST $789,963) .............. 789,963
YANKEE CERTIFICATES OF DEPOSIT -- 22.3%
Bayerische Hypotheken Bank
6.06% 01/10/00 ............. 50,000 50,000
6.09% 01/28/00 ............. 63,300 63,300
Canadian Imperial Bank of Commerce
4.875% 01/03/00 ............. 2,860 2,860
Dresdner Bank AG
5.81% 02/28/00 ............. 104,350 103,374
Rabobank USA Financial Corp.
4.50% 01/03/00 ............. 22,570 22,570
Royal Bank of Canada
4.75% 01/03/00 ............. 75,370 75,370
Societe Generale North America Inc.
5.91% 02/25/00 ............. 98,560 97,685
TOTAL YANKEE CERTIFICATES OF DEPOSIT
(COST $415,159) .............. 415,159
TIME DEPOSIT -- 4.0%
Republic National Bank New York New York
(COST $75,130) ............... 75,130 75,130
TOTAL SHORT-TERM INVESTMENTS
(COST $1,902,888) ............ 1,902,888
OTHER ASSETS AND LIABILITIES,
NET (2.2)% ................. (40,916)
----------
NET ASSETS-- 100% ............... $1,861,972
==========
- -----------
See Notes to Schedules of Investments (which are unaudited for the purposes of
this fund).
33
<PAGE>
GE S&S PROGRAM SUPPLEMENTAL INFORMATION
- --------------------------------------------------------------------------------
(UNAUDITED)
INVESTMENT AT $100 PER MONTH
The first table illustrates the cumulative value at each year of an assumed
investment in the amount of $100 per month. The table covers an investment
beginning January 1, 1997, in GE Common Stock ("Stock"), GE S&S Program Mutual
Fund ("Program Mutual Fund"), GE S&S Long-Term Interest Fund ("LT Interest
Fund"), GE S&S Short-Term Interest Fund ("ST Interest Fund"), GE S&S Money
Market Fund ("Money Market Fund"), U.S. Savings Bonds ("Bonds") and GE
Institutional International Equity Fund ("International Equity Fund").
<TABLE>
<CAPTION>
VALUE OF INVESTMENT OF $100 PER MONTH (A)
Investment Beginning January 1, 1997
STOCK PROGRAM MUTUAL FUND LT INTEREST FUND
------------------------- ------------------------- -------------------------
CUMULATIVE MARKET VALUE VALUE VALUE
AMOUNT INCLUDING INCLUDING INCLUDING
AT YEAR INVESTED CUMULATIVE REINVESTED CUMULATIVE REINVESTED CUMULATIVE REINVESTED
ENDED IN EACH REINVESTED DIVIDENDS REINVESTED DISTRIBUTIONS REINVESTED DISTRIBUTIONS
DEC. 31 MEDIA DIVIDENDS (C) (D) (E) DISTRIBUTIONS (D) (F) DISTRIBUTIONS (D) (F)
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 ............... $1,200 $13 $1,457 $ 153 $1,490 $ 45 $1,268
1998 ............... 2,400 37 3,489 521 3,541 222 2,629
1999 ............... 3,600 92 6,988 1,512 6,619 433 3,807
ST INTEREST FUND MONEY MARKET FUND
------------------------- -------------------------
CUMULATIVE VALUE VALUE
AMOUNT INCLUDING INCLUDING
AT YEAR INVESTED CUMULATIVE REINVESTED CUMULATIVE REINVESTED
ENDED IN EACH REINVESTED INTEREST REINVESTED INTEREST
DEC. 31 MEDIA INTEREST (D) (F) INTEREST (D) (F)
- ----------------------------------------------------------------------------------------
1997 ............... $1,200 $ 43 $1,246 $ 37 $1,237
1998 ............... 2,400 162 2,574 142 2,542
1999 ............... 3,600 348 3,886 312 3,912
BONDS INTERNATIONAL EQUITY FUND
------------------------- --------------------------
CUMULATIVE REDEMPTION VALUE
AMOUNT VALUE INCLUDING
AT YEAR INVESTED CUMULATIVE INCLUDING CUMULATIVE REINVESTED
ENDED IN EACH ACCRUED ACCRUED REINVESTED DISTRIBUTIONS
DEC. 31 MEDIA INTEREST INTEREST (B) DISTRIBUTIONS (D) (F) (G)
- -----------------------------------------------------------------------------------------
1997 ............... $1,200 $ 36 $1,236 N/A N/A
1998 ............... 2,400 131 2,531 $ 55 $1,536
1999 ............... 3,600 276 3,876 164 3,430
</TABLE>
34
<PAGE>
GE S&S PROGRAM SUPPLEMENTAL INFORMATION
- --------------------------------------------------------------------------------
(UNAUDITED)
NOTES:
(a) The Program provides for Proportionate Company Payments in addition to
Employee Contributions. The amounts shown are simply for illustrative
purposes and do not reflect any such Proportionate Company Payments. Past
performance is no guarantee of future results.
(b) The redemption value assumes the bonds are held longer than five years and
does not include the 3-month interest penalty that would be applied if the
bonds were redeemed before five years.
(c) Cumulative reinvested dividends assumes that dividends on GE Common Stock
were not paid out to participant under the S&S dividend Payout Option.
(d) Cumulative values include the year-end market value of Stock and the share
price of Program Mutual Fund, LT Interest Fund, ST Interest Fund, Money
Market Fund and International Equity Fund purchased through the
reinvestment of income and dividends, as the case may be. Capital gains
distributions per unit were paid as follows:
PROGRAM LT INTERNATIONAL
MUTUAL INTEREST EQUITY
FUND FUND FUND
- -----------------------------------------------------------------
1997 ............. $ 6.52 $ -- $ --
1998 ............. 7.41 0.21 0.35
1999 ............. 13.34 0.03 0.41
(e) The market value of Stock is based on the closing price as of the last
business day of the year, as reported by the Consolidated Tape of New York
Stock Exchange listed shares.
(f) The value of ST Interest Fund, Money Market Fund, Program Mutual Fund, LT
Interest Fund and International Equity Fund shares are based on the Share
Price as of year-end. Share Price, which is equal to the net asset value
per share, is determined in accordance with Section III of Rules of the
Funds, which is contained in the GE S&S Program Plan Document.
(g) The International Equity Fund became available as an investment option for
the Program on June 30, 1999. Value of Investment of $100 Per Month in 1997
for the GE Institutional International Equity Fund presented in the table on
page 34 is from January 1st of the year following its inception. Had
investments of $100 per month been made from the commencement of the GE
Institutional International Equity Fund (November 25, 1997) to December 31,
1997, the value at the end of December 31, 1997 would be $203. Performance
information for periods prior to 1999 is provided only for comparative
purposes. Performance information for 1997 presented in the Value of
Investment of $1,000 table on page 36 is for the period from commencement of
operations of the GE Institutional International Equity Fund (November 25,
1997) to December 31, 1997 and is not annualized.
35
<PAGE>
GE S&S PROGRAM SUPPLEMENTAL INFORMATION
- --------------------------------------------------------------------------------
(UNAUDITED)
$1,000 INVESTMENT
This table illustrates the value at year-end of an assumed investment of $1,000
made on January 1, 1997 in Stock, Program Mutual Fund, LT Interest Fund, ST
Interest Fund, Money Market Fund, Bonds and International Equity Fund.
VALUE OF INVESTMENT OF $1,000
Investment Made on January 1, 1997
<TABLE>
<CAPTION>
STOCK PROGRAM MUTUAL FUND LT INTEREST FUND
------------------------- ------------------------- -------------------------
MARKET VALUE VALUE
VALUE INCLUDING INCLUDING
AT YEAR CUMULATIVE INCLUDING CUMULATIVE REINVESTED CUMULATIVE REINVESTED
ENDED REINVESTED REINVESTED REINVESTED DISTRIBUTIONS REINVESTED DISTRIBUTIONS
DEC. 31 DIVIDENDS (C) DIVIDENDS (D)(E) DISTRIBUTIONS (D) (F) DISTRIBUTIONS (D) (F)
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1997 ........ $22 $1,509 $162 $1,331 $ 70 $1,095
1998 ........ 47 2,128 370 1,647 144 1,188
1999 ........ 76 3,269 774 1,972 216 1,175
ST INTEREST FUND MONEY MARKET FUND
------------------------- -------------------------
VALUE VALUE
INCLUDING INCLUDING
AT YEAR CUMULATIVE REINVESTED CUMULATIVE REINVESTED
ENDED REINVESTED INTEREST REINVESTED INTEREST
DEC. 31 INTEREST (D) (F) INTEREST (D) (F)
- ------------------------------------------------------------------------------------------
1997 ........ $ 67 $1,069 $ 57 $1,057
1998 ........ 134 1,143 116 1,116
1999 ........ 200 1,182 175 1,175
BONDS INTERNATIONAL EQUITY FUND
------------------------- -------------------------
REDEMPTION VALUE
VALUE INCLUDING
AT YEAR CUMULATIVE INCLUDING CUMULATIVE REINVESTED
ENDED ACCRUED ACCRUED REINVESTED DISTRIBUTIONS
DEC. 31 INTEREST INTEREST (B) DISTRIBUTIONS (D) (F) (G)
- -----------------------------------------------------------------------------------------
1997 ........ $ 53 $1,053 $ 1 $1,027
1998 ........ 107 1,107 48 1,204
1999 ........ 158 1,158 99 1,588
- -----------------------------------------------------------------------------------------
</TABLE>
36
<PAGE>
GE S&S PROGRAM SUPPLEMENTAL INFORMATION
- --------------------------------------------------------------------------------
(UNAUDITED)
Program Mutual Fund, LT Interest Fund and International Equity
Fund Operating Expenses (as a percentage of average net
assets) for the year-ended December 31, 1999:
PROGRAM LT INTERNATIONAL
MUTUAL INTEREST EQUITY
FUND FUND FUND
- -------------------------------------------------------------------------------
Management Expenses ........... 0.06% 0.06% 0.75%*
Other Expenses ................ 0.03% 0.07% None**
------- ------- -------
Total Fund Operating Expenses . 0.09% 0.13% 0.75%
======= ======= =======
The following expenses would be paid on a $1,000
investment utilizing the expense ratio's shown
above and assuming a 5% annual return:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
- --------------------------------------------------------------------------
Program Mutual Fund .......... $1 $ 3 $ 5 $12
LT Interest Fund ............. 1 4 7 17
International Equity Fund .... 8 24 42 93
The purpose of this table is to assist the investor in understanding the
expenses that an investor in the Funds will bear indirectly. This example should
not be considered a representation of past or future expenses. Actual expenses
may be greater or lesser than those shown.
SEE PAGE 35 FOR EXPLANATION OF NOTES (B), (C), (D), (E) AND (F) AND (G).
*THE ADVISORY AND ADMINISTRATION FEE SHOWN IS THE MAXIMUM PAYABLE BY THE GE
INSTITUTIONAL INTERNATIONAL EQUITY FUND; THIS FEE DECLINES INCREMENTALLY AS THE
GE INSTITUTIONAL INTERNATIONALEQUITY FUND'S ASSETS INCREASE. THE FUND'S
ADVISORY AND ADMINISTRATION FEE IS INTENDED TO BE AN "UNITARY" FEE THAT
INCLUDES ANY OTHER OPERATING EXPENSES PAYABLE BY THE FUND, EXCEPT FOR FEES
PAID TO THE FUND'S INDEPENDENT TRUSTEES, BROKERAGE FEES, AND EXPENSES THAT
ARE NOT NORMAL OPERATING EXPENSES OF THE FUND (SUCH AS EXTRAORDINARY EXPENSES,
INTEREST AND TAXES.)
**"OTHER EXPENSES" INCLUDE ONLY TRUSTEES' FEES PAYABLE TO THE FUND'S INDEPENDENT
TRUSTEES, BROKERAGE FEES, AND EXPENSES THAT ARE NOT NORMAL OPERATING EXPENSES
OF THE FUND. THIS AMOUNT IS LESS THAN .01%; THEREFORE "OTHER EXPENSES" ARE
REFLECTED AS "NONE."
37
<PAGE>
GE S&S PROGRAM DISCLOSURE STATEMENT
- --------------------------------------------------------------------------------
GE SAVINGS AND SECURITY PROGRAM DISCLOSURE STATEMENT
IN THE GE SAVINGS AND SECURITY PROGRAM (THE "PROGRAM"), YOU -- NOT GENERAL
ELECTRIC COMPANY ("GE"), THE TRUSTEES OF THe PROGRAM (THE "TRUSTEES") OR ANYONE
ELSE -- CONTROL YOUR OWN INVESTMENTS. YOU HAVE A DIVERSE CHOICE OF INVESTMENT
OPTIONS AND THE ABILITY TO MAKE FREQUENT CHANGES, DEPENDING ON YOUR PERSONAL
SAVINGS STRATEGY. AS A RESULT, THE FIDUCIARIES OF THE PROGRAM WILL NOT BE LIABLE
FOR LOSSES OR OTHER INVESTMENT EXPERIENCE OCCURRING TO YOUR ACCOUNT BECAUSE OF
YOUR INVESTMENT CONTROL.
THE PROGRAM IS DESIGNED TO COMPLY WITH SECTION 404(C) OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT ("ERISA"), WHICH SETS FORTH CERTAIN RIGHTS AND
RESPONSIBILITIES OF FIDUCIARIES. UNDER SECTION 404(C) OF ERISA, THE FIDUCIARIES
OF THE PROGRAM WILL BE RELIEVED OF LIABILITY FOR ANY LOSSES OR OTHER INVESTMENT
EXPERIENCE WHICH ARE THE DIRECT AND NECESSARY RESULT OF YOUR INVESTMENT
INSTRUCTIONS. THIS DOCUMENT CONSTITUTES PART OF THE INFORMATION REQUIRED TO BE
PROVIDED TO PARTICIPANTS BY SECTION 404(C) OF ERISA AND TITLE 29 OF THE CODE OF
FEDERAL REGULATIONS SECTION 2550.404C-1. FOR A DESCRIPTION OF CERTAIN ADDITIONAL
INFORMATION AVAILABLE TO PARTICIPANTS OF THE PROGRAM, PLEASE REFER TO
"ADDITIONAL INFORMATION" LATER IN THIS DISCLOSURE STATEMENT.
The Program provides employees of GE and its participating affiliates an
opportunity for convenient, regular and substantial personal savings. For more
information about the Program, including how you can enroll, how much you can
save, how you can switch your savings between investment options, and any
restrictions on investments, please refer to the GE Benefits Handbook or, if you
are no longer on the active payroll, the Saving for the Future booklet. A copy
of these documents is available by calling 1-800-432-4313. A copy of the GE
Benefits Handbook is also available at benefits.ge.com.
This Disclosure Statement provides information about the investment options
(other than the GE Institutional International Equity Fund) available to
participants of the Program to assist them in making informed investment
decisions. Information about the GE Institutional International Equity Fund is
available to participants in a separate prospectus, a copy of which may be
obtained at benefits.ge.com or by calling 1-800-432-4313.
Participants may choose among one or more of the following investment options:
A. Common Stock of General Electric Company;
B. GE S&S Program Mutual Fund;
C. GE S&S Long-Term Interest Fund;
D. GE S&S Short-Term Interest Fund;
E. GE S&S Money Market Fund;
F. United States Savings Bonds (after-tax contributions only); and
G. GE Institutional International Equity Fund (which is described in a separate
prospectus).
I. DESCRIPTION OF INVESTMENT OPTIONS
A. COMMON STOCK OF GENERAL ELECTRIC COMPANY ("GE COMMON STOCK")1
ASSET CLASS
Stocks
INVESTOR PROFILE
Participants who can tolerate the potential for a significant degree of price
fluctuation and possible loss of capital. This investment option may be most
useful for those participants who have intermediate- to long-term investment
goals.
- ----------------
1 RESALE OF SHARES OF GE COMMON STOCK ACQUIRED PURSUANT TO THE PROGRAM:
Executive officers of GE may reoffer or resell the GE Common Stock acquired
pursuant to the Program only in connection with a separate registration
statement which has been declared effective under Federal securities laws or
pursuant to an available exemption under those laws, including an exemption
provided by Rule 144. Executive officers of GE who acquire GE Common Stock
pursuant to the Program should consult the Corporate Counsel to determine
whether their position within GE requires them to comply with the resale
restrictions described above.
38
<PAGE>
GE S&S PROGRAM DISCLOSURE STATEMENT
- --------------------------------------------------------------------------------
INVESTMENT OVERVIEW
This investment option provides participants with the opportunity to invest in
shares of GE Common Stock and share in GE's long-term growth and dividend
payouts.
PRINCIPAL RISKS
The principal risk of investing in GE Common Stock is STOCK MARKET RISK. An
investment in the stock of any company, including GE, may be subject to greater
market volatility than an investment alternative that holds a diversified
portfolio of securities. The value of your investment may be worth more or less
than your original investment. In addition, GE's Board of Directors may increase
or decrease the rate of dividends paid on GE Common Stock at any time.
VOTING RIGHTS
Holders of GE Common Stock through the Program have the same voting rights as
all other GE share owners. They will receive proxy statements, annual reports
and other share owner information that is sent to all share owners. Participants
who have mailboxes on GE's e-mail system may, however, receive instructions for
accessing the proxy statement and annual report on GE's website, instead of
receiving these documents in hard copy, unless they specifically request hard
copies. There are no restrictions on the exercise of voting, tender or similar
rights in connection with a participant's investment in GE Common Stock.
The policy of the Trustees is to keep information relating to GE Common Stock
transactions and voting confidential. The Trustees are responsible for
monitoring compliance with the procedures established to provide for the
confidentiality of this information. The Trustees may be contacted c/o GE Asset
Management, 3003 Summer Street, Stamford, CT 06904 Attn: S&SP Trustees or by
phone at (203) 326-2300.
For the definition of terms in BOLD TYPE, please refer to "More Information on
Strategies and Risks" later in this Disclosure Statement.
B. GE S&S PROGRAM MUTUAL FUND ("PROGRAM MUTUAL FUND")
ASSET CLASS
Stocks
INVESTOR PROFILE
Participants who can tolerate a significant degree of price fluctuation and
possible loss of capital. This investment option may also be most useful for
participants who want to diversify their portfolios and who have intermediate-
to long-term investment goals.
INVESTMENT OBJECTIVE
The Program Mutual Fund seeks long-term growth of capital and income.
PRINCIPAL INVESTMENT STRATEGIES
The Program Mutual Fund invests primarily in a diversified portfolio of EQUITY
SECURITIES of U.S. companies. The portfolio managers use a Multi-Style(R)
investment strategy that combineS GROWTh anD VALUe investment management styles.
AS a result, the portfolio has characteristics similar to the Standard & Poor's
500 Composite Stock Index, including capital appreciation and income potential.
Stock selection is key to the performance of the Program Mutual Fund.
Through fundamental company research, the portfolio managers seek to identify
securities of large companies with characteristics such as:
[BULLET] attractive valuations
[BULLET] financial strength
[BULLET] high quality management focused on generating shareholder value
The Program Mutual Fund also may invest to a lesser extent in FOREIGN SECURITIES
and DEBT SECURITIES (including INVESTMENT GRADE SECURITIES and HIGH YIELD
SECURITIES). The portfolio managers may use VARIOUS INVESTMENT TECHNIQUES to
adjust the Program Mutual Fund's investment exposure, but there is no guarantee
that these techniques will work.
PRINCIPAL RISKS
The principal risk of investing in the Program Mutual Fund is STOCK MARKET RISK.
To the extent that the portfolio managers invest in FOREIGN SECURITIES or DEBT
SECURITIES, the Program Mutual Fund also would
39
<PAGE>
GE S&S PROGRAM DISCLOSURE STATEMENT
- --------------------------------------------------------------------------------
be subject to FOREIGN EXPOSURE RISK or INTEREST RATE RISK, CREDIT RISK and HIGH
YIELD SECURITIES RISK.
If you would like additional information regarding the Program Mutual Fund's
strategies and risks, including a definition of terms in BOLD TYPE, please refer
to "More Information on Strategies and Risks" later in this Disclosure
Statement.
C. GE S&S LONG-TERM INTEREST FUND ("LT INTEREST FUND")
ASSET CLASS
Bonds
INVESTOR PROFILE
Participants who seek a high level of current income and are willing to tolerate
a moderate degree of price fluctuation in comparison to investments in equity
securities. This investment option may also be most useful for participants who
want to diversify their portfolios and who have intermediate investment goals.
INVESTMENT OBJECTIVE
The LT Interest Fund seeks a high interest rate of return over a long-term
period consistent with the preservation of capital.
PRINCIPAL INVESTMENT STRATEGIES
The LT Interest Fund invests primarily in a diversified portfolio of INVESTMENT
GRADE DEBT SECURITIES, such as U.S. GOVERNMENT SECURITIES, MORTGAGE-BACKED
SECURITIES, ASSET-BACKED SECURITIES, CORPORATE BONDS, and MONEY MARKET
instruments. The LT Interest Fund normally has A WEIGHTED AVERAGE MATURITY of
approximately five to ten years.
The portfolio managers seek to identify debt securities with characteristics
such as:
[BULLET] attractive yields and prices
[BULLET] the potential for capital appreciation
[BULLET] reasonable credit quality
The LT Interest Fund also may invest to a lesser extent in HIGH YIELD SECURITIES
and FOREIGN SECURITIES. The portfolio managers may use VARIOUS INVESTMENT
TECHNIQUES to adjust the LT Interest Fund's investment exposure, but there is no
guarantee that these techniques will work.
PRINCIPAL RISKS
The principal risks of investing in the LT Interest Fund are INTEREST RATE RISK,
CREDIT RISK, and PREPAYMENT RISK. To the extent that the portfolio managers
invest in HIGH YIELD SECURITIES or FOREIGN SECURITIES, the LT Interest Fund also
would be subject to HIGH YIELD SECURITIES RISK and FOREIGN EXPOSURE RISK.
Certain portfolio securities are DERIVATIVE SECURITIES that carry DERIVATIVE
SECURITIES RISK.
If you would like additional information regarding the LT Interest Fund's
strategies and risks, including a definition of terms in BOLD TYPE, please refer
to "More Information on Strategies and Risks" later in this Disclosure
Statement.
D. GE S&S SHORT-TERM INTEREST FUND ("ST INTEREST FUND")
ASSET CLASS
Bonds
INVESTOR PROFILE
Conservative participants who seek a market-related level of current income and
are willing to tolerate some degree of price fluctuation. This investment option
may be the most useful for participants who want to diversify their portfolios
and who have intermediate- to near-term investment goals.
INVESTMENT OBJECTIVE
The ST Interest Fund seeks to preserve principal and achieve a market-related
interest rate of return.
PRINCIPAL INVESTMENT STRATEGIES
The ST Interest Fund invests primarily in a diversified portfolio of INVESTMENT
GRADE DEBT SECURITIES, such as U.S. GOVERNMENT SECURITIES, MORTGAGE-BACKED
SECURITIES, ASSET-BACKED SECURITIES, CORPORATE BONDS and MONEY MARKET
INSTRUMENTS. The ST Interest Fund normally has a WEIGHTED AVERAGE MATURITY of
not more than three years.
The portfolio managers seek to identify debt securities with characteristics
such as:
40
<PAGE>
GE S&S PROGRAM DISCLOSURE STATEMENT
- --------------------------------------------------------------------------------
[BULLET] attractive yields and prices
[BULLET] the potential for capital appreciation
[BULLET] reasonable credit quality
The ST Interest Fund may invest to a lesser extent in HIGH YIELD SECURITIES and
FOREIGN SECURITIES. The portfolio managers may use VARIOUS INVESTMENT TECHNIQUES
to adjust the ST Interest Fund's investment exposure, but there is no guarantee
that these techniques will work.
PRINCIPAL RISKS
The principal risks of investing in the ST Interest Fund are INTEREST RATE RISK,
CREDIT RISK and PREPAYMENT RISK. To the extent that the portfolio managers
invest in HIGH YIELD SECURITIES or FOREIGN SECURITIES, the ST Interest Fund also
would be subject to HIGH YIELD SECURITIES RISK and FOREIGN EXPOSURE RISK.
Certain portfolio securities are DERIVATIVE SECURITIES that carry DERIVATIVE
SECURITIES RISK.
If you would like additional information regarding the ST Interest Fund's
strategies and risks, including a definition of terms in BOLD TYPE, please refer
to "More Information on Strategies and Risks" later in this Disclosure
Statement.
E. GE S&S MONEY MARKET FUND ("MONEY MARKET FUND")
ASSET CLASS
Cash Equivalent
INVESTOR PROFILE
Conservative, income-oriented participants who seek a market-related level of
current income. This investment option may be most useful for participants who
want to diversify their portfolios and who have near-term investment goals.
INVESTMENT OBJECTIVE
The Money Market Fund seeks a high level of current income consistent with the
preservation of capital and maintenance of liquidity.
PRINCIPAL INVESTMENT STRATEGIES
The Money Market Fund invests primarily in short-term, U.S. dollar-denominated
MONEY MARKET INSTRUMENTS and other DEBT SECURITIES that mature in one year or
less. The Money Market Fund's investments may include U.S. GOVERNMENT
SECURITIES, CORPORATE BONDS, REPURCHASE AGREEMENTS, COMMERCIAL PAPER,
CERTIFICATES OF DEPOSIT, VARIABLE RATE SECURITIES, FOREIGN DEBT SECURITIES, and
domestic and foreign BANK DEPOSITS.
PRINCIPAL RISKS
The principal risks of investing in the Money Market Fund are INTEREST RATE RISK
and CREDIT RISK.
An investment in the Money Market Fund is not a bank deposit and is not insured
or guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other
government agency. It is possible to lose money by investing in the Money Market
Fund. The Money Market Fund's yield will change due to movements in current
short-term interest rates and market conditions. No assurance can be given that
the Fund will be able to maintain a stable value.
If you would like additional information regarding the Money Market Fund's
strategies and risks, including a definition of terms in BOLD TYPE, please refer
to "More Information on Strategies and Risks" later in this Disclosure
Statement.
F. UNITED STATES SAVINGS BONDS ("BONDS")
ASSET CLASS
Cash Equivalent -- although technically a bond, the liquidity and stability of
EE Savings Bonds mean that they are generally viewed as a cash equivalent.
INVESTOR PROFILE
Conservative, safety oriented participants who seek a very high level of
principal protection.
INVESTMENT OVERVIEW
The Bonds available under this option are Series "EE" Savings Bonds issued by
the U.S. Treasury. The Bonds mature 30 years after their issue date. They earn
interest based on market yields for Treasury Securities. Each May 1 and November
1, the U.S. Government sets the rates for the Bonds that apply for the next six
months. Principal and accrued interest are paid when the bond is redeemed or on
its
41
<PAGE>
GE S&S PROGRAM DISCLOSURE STATEMENT
- --------------------------------------------------------------------------------
maturity date. A three-month interest penalty will apply to Bonds redeemed
before five years from the date of purchase.
Only after-tax employee contributions can be used to purchase Bonds through the
Program.
PRINCIPAL RISKS
Interest rates applied to the Bonds are based upon interest rates of certain
Treasury securities. In general, when interest rates on Treasury securities
fall, the rate of return on the Bonds will follow. The principal of your
investment in the Bonds is backed by the full faith and credit of the U.S.
Government.
II. MORE INFORMATION ON STRATEGIES AND RISKS
A. IMPORTANT DEFINITIONS
This section defines important terms that may be unfamiliar to an investor
reading about the investment alternatives. The Program Mutual Fund, LT Interest
Fund, ST Interest Fund and Money Market Fund are referred to in this Disclosure
Statement individually as a "Fund" and collectively as the "Funds".
ASSET-BACKED SECURITIES represent a participation in, or are secured by and
payable from, a stream of payments generated by particular assets, such as
credit card receivables or auto loans.
BANK DEPOSITS are cash, checks or drafts deposited in a financial institution
for credit to a customer's account. Banks differentiate between demand deposits
(checking accounts on which the customer may draw) and time deposits, which pay
interest and have a specified maturity or require 30 days' notice before
withdrawal.
CASH AND CASH EQUIVALENTS are highly liquid and highly rated instruments such
as commercial paper and bank deposits.
CERTIFICATES OF DEPOSIT include short-term debt securities issued by banks.
COMMERCIAL PAPER includes short-term debt securities issued by banks,
corporations and other borrowers.
CONVERTIBLE SECURITIES may be debt or equity securities that pay interest or
dividends or are sold at a discount and that may be converted on specified terms
into the stock of the issuer.
CORPORATE BONDS are debt securities issued by companies.
DEBT OBLIGATIONS OF SUPRANATIONAL AGENCIES are obligations of
multi-jurisdictional agencies that operate across national borders (E.G., the
World Bank).
DEBT SECURITIES are bonds and other securities that are used by issuers to
borrow money from investors. Holders of debt securities have a higher priority
claim to assets than do equity holders. Typically, the debt issuer pays the
investor a fixed, variable or floating rate of interest and must repay the
borrowed amount at maturity. Some debt securities, such as zero coupon bonds,
are sold at a discount from their face values instead of paying interest.
DEPOSITARY RECEIPTS represent interests in an account at a bank or trust
company which holds equity securities. These interests may include American
Depositary Receipts (held at U.S. banks and traded in the United States),
European Depositary Receipts, Global Depositary Receipts or other similar
instruments.
DERIVATIVE SECURITIES are securities whose values are based on other
securities, currencies or indices and include options (on stocks, indices,
currencies, futures contracts or bonds), forward currency exchange contracts,
futures contracts, swaps, interest-only and principal-only debt securities,
certain MORTGAGE-BACKED SECURITIES like collateralized mortgage obligations
(CMOs), and structured securities.
DURATION represents a mathematical calculation of the average life of a bond
(or portfolio of bonds) based on cash flows that serves as a useful measure of
the security's sensitivity to changes in interest rates. Each year of duration
approximates an expected one percent change in the bond's price for every one
percent change in the interest rate.
EQUITY SECURITIES may include common stocks, PREFERRED SECURITIES, DEPOSITARY
RECEIPTS, CONVERTIBLE
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GE S&S PROGRAM DISCLOSURE STATEMENT
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SECURITIES, and RIGHTS and WARRANTS of U.S. and foreign companies. Stocks
represent an ownership interest in a corporation.
EURODOLLAR DEPOSITS are deposits issued in U.S. dollars by foreign banks and
foreign branches of U.S. banks.
FLOATING AND VARIABLE RATE INSTRUMENTS are securities with floating or
variable rates of interest or dividend payments.
FOREIGN DEBT SECURITIES are issued by foreign corporations and governments.
They may include the following:
[BULLET] Eurodollar Bonds, which are dollar-denominated securities issued
outside the U.S. by foreign corporations and financial institutions and
by foreign branches of U.S. corporations and financial institutions
[BULLET] Yankee Bonds, which are dollar-denominated securities issued by foreign
issuers in the U.S;
[BULLET] Securities denominated in currencies other than U.S. dollars.
FOREIGN SECURITIES include interests in or obligations of entities located
outside of the United States. The determination of where an issuer of a security
is located will be made by reference to the country in which the issuer (a) is
organized, (b) derives at least 50% of its revenues or profits from goods
produced or sold, investments made or services performed, (c) has at least 50%
of its assets situated, or (d) has the principal trading market for its
securities. Foreign securities may be denominated in non-U.S. currencies and
traded outside the United States or may be in the form of depositary receipts.
FORWARD CURRENCY TRANSACTIONS involve agreements to exchange one currency for
another at a future date.
FUTURES are agreements to buy or sell a specific amount of a commodity,
financial instrument or index at a particular price and future date. OPTIONS ON
FUTURES give the purchaser the right, in return for the premium paid, to assume
a position in a futures contract at a specified exercise price at any time prior
to the expiration date of the option.
GROWTH INVESTING involves buying stocks with above-average growth rates.
Typically, growth stocks are the stocks of faster growing companies in more
rapidly growing sectors of the economy. Generally, growth stock valuation levels
will be higher than those of value stocks and the market averages.
HIGH YIELD SECURITIES are debt securities of corporations, preferred stock
and convertible bonds and convertible preferred stock rated Ba through C by
Moody's or BB through D by S&P (or comparably rated by another nationally
recognized statistical rating organization) or, if not rated by Moody's or S&P,
are considered by portfolio management to be of equivalent quality. High yield
securities include bonds rated below investment grade, sometimes called "junk
bonds," and are considered speculative by the major credit rating agencies.
INVESTMENT GRADE SECURITIES are rated Baa or better by Moody's and BBB or
better by S&P or are comparably rated by another nationally recognized
statistical rating organization, or, if not rated, are of similar quality to
such securities. Securities rated in the fourth highest grade have some
speculative elements.
MATURITY represents the date on which a debt security matures or when the
issuer must pay back the principal amount of the security.
MONEY MARKET INSTRUMENTS are short-term debt securities of the U.S.
government, banks and corporations. The Funds that may invest in money market
securities may do so directly or indirectly through investments in the GEI
Short-Term Investment Fund. The GEI Short-Term Investment Fund is advised by GE
Asset Management Incorporated ("GEAM"), which charges no advisory fee for such
services.
MORTGAGE-BACKED SECURITIES include securities issued by the Government
National Mortgage Association (Ginnie Mae), the Federal National Mortgage
Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie
Mac) and other government agencies and private issuers. They may also include
collateralized mortgage obligations which are derivative securities that are
fully collateralized by a portfolio of mortgages. GOVERNMENT STRIPPED MORT-
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GE S&S PROGRAM DISCLOSURE STATEMENT
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GAGE-RELATED SECURITIES are mortgage-backed securities that have been stripped
into their interest and principal components. They represent interests in
distributions of interest on or principal underlying mortgage-backed
certificates. MORTGAGE DOLLAR ROLLS are transactions involving the sale of a
mortgage-backed security with a simultaneous contract (with the purchaser) to
buy similar, but not identical, securities at a future date.
PREFERRED SECURITIES are classes of stock that pay dividends at a specified
rate. Dividends are paid on preferred stocks before they are paid on common
stocks. In addition, preferred stockholders have priority over common
stockholders as to the proceeds from the liquidation of a company's assets.
PURCHASING AND WRITING OPTIONS are permitted investment strategies for
certain Funds. An option is the right to buy (I.E., a "call") or sell (I.E., a
"put") securities or other interests for a predetermined price on or before a
fixed date. An OPTION ON A SECURITIES INDEX represents the option holder's right
to obtain from the seller, in cash, a fixed multiple of the amount by which the
exercise price exceeds (in the case of a call) or is less than (in the case of a
put) the closing value of the securities index on the exercise date. An OPTION
ON A FOREIGN CURRENCY represents the right to buy or sell a particular amount of
that currency for a predetermined price on or before a fixed date.
REPURCHASE AGREEMENTS, also known as repos, are used to invest cash on a
short-term basis. A seller (bank or broker-dealer) sells securities, usually
government securities, to a Fund, agreeing to buy them back at a designated
price and time - usually the next day.
RESTRICTED SECURITIES (which include Rule 144A securities) may have
contractual restrictions on resale, or cannot be resold publicly until
registered. Certain restricted securities may be illiquid. ILLIQUID SECURITIES
may be difficult or impossible to sell when a Fund wants to sell them at a price
at which the Fund values them. RULE 144A SECURITIES are restricted securities
that may be sold to certain institutional purchasers under Rule 144A.
REVERSE REPURCHASE AGREEMENTS, also known as reverse repos, involve selling
securities held and concurrently agreeing to repurchase the same securities at a
specified price and future date.
RIGHTS represent a preemptive right of stockholders to purchase additional
shares of a stock at the time of a new issuance, before the stock is offered to
the general public, allowing the stockholder to retain the same ownership
percentage after the new stock offering.
STRUCTURED AND INDEXED SECURITIES are securities whose principal and/or
interest rate is determined by reference to changes in the value of one or more
specific currencies, interest rates, commodities, indices or other financial
indicators.
U.S. GOVERNMENT SECURITIES are issued or guaranteed as to principal or
interest by the U.S. Government or one of its agencies or instrumentalities.
Some U.S. Government securities are backed by the full faith and credit of the
federal government. Other U.S. Government securities are backed by the issuer's
right to borrow from the U.S. Treasury and some are backed only by the credit of
the issuing organization. All U.S. Government securities are considered highly
creditworthy.
VALUE INVESTING involves buying stocks that are out of favor and/or
undervalued in comparison to their peers and/or their prospects for growth.
Generally, value stock valuation levels are lower than those of growth stocks.
VARIABLE RATE SECURITIES carry interest rates that may be adjusted
periodically to market rates. Interest rate adjustments could increase or
decrease the income generated by the securities.
VARIOUS INVESTMENT TECHNIQUES are utilized by a Fund to increase or decrease
its exposure to changing security prices, interest rates, currency exchange
rates, commodity prices or other factors that affect security values. For
certain Funds, these techniques may involve DERIVATIVE SECURITIES and
transactions such as buying and selling options and futures contracts, entering
into currency exchange contracts or
44
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GE S&S PROGRAM DISCLOSURE STATEMENT
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swap agreements and purchasing indexed securities. These techniques are designed
to adjust the risk and return characteristics of a Fund's portfolio of
investments and are not used for leverage. No Fund is under any obligation to
use any of these techniques at any given time or under any particular economic
condition. To the extent that a Fund employs these techniques, it would be
subject to DERIVATIVE SECURITIES RISK.
WARRANTS are securities that are usually issued together with a bond or
preferred stock, that permits the holder to buy a proportionate amount of common
stock at a specified price that is usually higher than the stock price at the
time of issue.
WEIGHTED AVERAGE MATURITY represents the length of time in days or years
until the average security in a money market or bond fund will mature or be
redeemed by its issuer. The average maturity is weighted according to the dollar
amounts invested in the various securities in the fund. This measure indicates
an income fund's sensitivity to changes in interest rates. In general, the
longer a fund's average weighted maturity, the more its share price will
fluctuate in response to changing interest rates.
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES are securities that are purchased
or sold for delivery and payment at a future date, I.E., beyond normal
settlement date.
ZERO COUPON OBLIGATIONS pay no interest to their holders prior to maturity.
Instead, interest is paid in a lump sum at maturity. They are purchased at a
discount from par value, and generally are more volatile than other fixed income
securities.
B. MORE INFORMATION ON INVESTMENT STRATEGIES
In addition to the principal investment objectives and methods described
earlier in this Disclosure Statement, each of the Program Mutual Fund, LT
Interest Fund, ST Interest Fund and Money Market Fund is permitted to use other
securities and investment strategies in pursuit of its investment objective. No
Fund is under any obligation to use any of these techniques or strategies at any
given time or under any particular economic condition. Certain instruments and
investment strategies expose the Funds to other risks and considerations.
HOLDING CASH AND TEMPORARY DEFENSIVE POSITIONS: Under normal circumstances,
each Fund may hold CASH and/or MONEY MARKET INSTRUMENTS (i) pending investment,
(ii) for cash management purposes, and (iii) to meet operating expenses, if any.
A Fund may from time to time take temporary defensive positions when the
portfolio manager believes that adverse market, economic, political or other
conditions exist. In these circumstances, the portfolio manager may (i) without
limit hold CASH and CASH EQUIVALENTS and/or invest in MONEY MARKET INSTRUMENTS,
or (ii) restrict the securities markets in which a Fund's assets are invested by
investing those assets in securities markets deemed to be conservative in light
of the Fund's investment objective and strategies.
To the extent that a Fund, other than the Money Market Fund, holds cash or
invests in money market instruments, it may not achieve its investment
objective.
CASH MANAGEMENT OF THE LT INTEREST AND ST INTEREST FUNDS: The LT Interest
Fund and the ST Interest Fund may invest, directly or indirectly through
investment in the GEI Short-Term Investment Fund (the "Investment Fund")
described below, in the following types of money market instruments (i)
securities issued or guaranteed by the U.S. Government or one of its agencies or
instrumentalities, (ii) debt obligations of U.S. banks, savings and loan
institutions, insurance companies and mortgage bankers, (iii) commercial paper
and notes, including those with variable and floating rates of interest, (iv)
debt obligations of foreign branches of U.S. banks, U.S. branches of foreign
banks and foreign branches of foreign banks, (v) debt obligations issued or
guaranteed by one or more foreign governments or any of their political
subdivisions, agencies or instrumentalities, including obligations of
supranational entities, (vi) debt securities issued by foreign issuers and (vii)
repurchase agreements. The Investment Fund was created specifically to serve as
a vehicle for the collective investment of cash balances of the ST Interest
45
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GE S&S PROGRAM DISCLOSURE STATEMENT
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Fund and the LT Interest Fund and other accounts advised by either General
Electric Investment Corporation or its affiliate, GEAM (collectively, "GE Asset
Management"). By using the Investment Fund, each Fund's cash position is exposed
to potentially broader diversification, lower transaction cost and better
investment opportunity than would be the case if it were invested separately
without the potential benefits of such a large cash pool.
The Investment Fund invests exclusively in the money market instruments
described in (i) through (vii) above. The Investment Fund is advised by GEAM. No
advisory fee is charged by GEAM to the Investment Fund, nor will a Fund incur
any sales charge, redemption fee, distribution fee or service fee in connection
with its investments in the Investment Fund.
Although, during normal market conditions, the uninvested cash balances of
the ST Interest Fund and the LT Interest Fund are generally expected to be
relatively small, the ST Interest Fund may invest up to 25% of its assets in the
Investment Fund if the size of the cash balance so warrants.
The following table summarizes some of the investment techniques that may be
employed by a Fund. Certain techniques may be changed at the discretion of
General Electric Investment Corporation.
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------
PROGRAM LT ST MONEY
MUTUAL INTEREST INTEREST MARKET
FUND FUND FUND FUND
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Repurchase Agreements YES YES YES YES
Reverse Repurchase Agreements NO YES YES NO
Restricted & Illiquid Securities YES YES YES NO
Structured and Indexed Securities NO YES YES NO
Purchasing and Writing Securities Options NO YES YES NO
Purchasing and Writing Securities Index Options NO YES YES NO
Futures and Options on Futures NO YES YES NO
Forward Currency Transactions NO YES YES NO
Options on Foreign Currencies NO YES YES NO
When Issued Delayed Securities YES YES YES YES
Lending Portfolio Securities YES YES YES YES
Rule 144A Securities YES YES YES YES
Debt Obligations of Supranational Agencies YES YES YES YES
Depositary Receipts YES YES YES NO
Floating and Variable Rate Instruments NO* YES YES YES
Zero Coupon Obligations YES YES YES YES
Mortgage-Related Securities, including CMOs NO YES YES NO
Government Stripped Mortgage Related Securities NO YES YES NO
Asset Backed Securities and Receivable Backed Securities NO YES YES NO
Mortgage Dollar Rolls NO YES YES NO
- -------------------------------------------------------------------------------------------------
</TABLE>
* Excludes commercial paper and notes with variable and floating rates of
interest.
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GE S&S PROGRAM DISCLOSURE STATEMENT
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C. MORE INFORMATION ON RISKS
This section defines important risk terms that are used in this Disclosure
Statement. In addition, be aware that an investment in any one or more
investment options under the Program should not be considered to be a complete
investment program.
CREDIT RISK:
The price of a bond is affected by the issuer's or counterparty's credit
quality. Changes in financial condition and general economic conditions can
affect the ability to honor financial obligations and therefore credit quality.
Lower quality bonds are generally more sensitive to these changes than higher
quality bonds. Even within securities considered investment grade, differences
exist in credit quality and some investment grade debt securities may have
speculative characteristics. A security's price may be adversely affected by the
market's opinion of the security's credit quality level even if the issuer or
counterparty has suffered no degradation in ability to honor the obligation.
DERIVATIVE SECURITIES RISK:
A Fund's use of VARIOUS INVESTMENT TECHNIQUES to increase or decrease its
exposure to changing security prices, investment rates, currency exchange rates,
commodity prices or other factors that affect security values may involve
derivative securities and contracts. Derivative securities and contracts
(securities and contracts whose values are based on other securities, currencies
or indices) include option contracts (on stocks, indices, currencies, futures
contracts or bonds), forward currency exchange contracts, futures contracts,
currency and interest rate swap contracts and structured securities. Derivative
securities and contracts may be used as a direct investment or as a hedge for a
Fund's portfolio or a portion of a portfolio. Hedging involves using a security
or contract to offset investment risk. Hedging may include reducing the risk of
a position held in a portfolio. Hedging and other investment techniques also may
be used to increase a Fund's exposure to a particular investment strategy. If
the portfolio manager's judgment of market conditions proves incorrect or the
strategy does not correlate well with a Fund's investments, the use of
derivatives could result in a loss regardless of whether the intent was to
reduce risk or increase return and may increase a Fund's volatility. In
addition, in the event that non-exchange traded derivatives are used, these
derivatives could result in a loss if the counterparty to the transaction does
not perform as promised. A Fund is not obligated to pursue any hedging strategy.
In addition, hedging techniques may not be available, may be too costly to be
used effectively or may be unable to be used for other reasons. These
investments may be considered speculative.
FOREIGN EXPOSURE RISK:
Investing in foreign securities, including depositary receipts, or securities
of U.S. entities with significant foreign operations, involves additional risks
which can affect a Fund's performance. Foreign markets may be less liquid, more
volatile and subject to less government supervision than U.S. markets. There may
be difficulties enforcing contractual obligations, and it may take more time for
transactions to clear and settle in foreign countries than in the U.S. Less
information may be available about foreign issuers. The costs of buying and
selling foreign securities, including tax, brokerage and custody costs,
generally are higher than those involving domestic transactions. The specific
risks of investing in foreign securities include:
CURRENCY RISK: The values of foreign investments may be affected by changes
in currency rates or exchange control regulations. If the local currency gains
strength against the U.S. dollar, the value of the foreign security increases in
U.S. dollar terms. Conversely, if the local currency weakens against the U.S.
dollar, the value of the foreign security declines in U.S. dollar terms. U.S.
dollar-denominated securities of foreign issuers, including Depositary Receipts,
also are subject to currency risk based on their related investments.
POLITICAL/ECONOMIC RISK: Changes in economic, tax or foreign investment
policies, government stability, war or other political or economic actions may
have an adverse effect on a Fund's foreign investments.
REGULATORY RISK: Foreign companies often are not subject to uniform
accounting, auditing and financial reporting standards or to other regulatory
practices and requirements common to U.S. companies.
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GE S&S PROGRAM DISCLOSURE STATEMENT
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HIGH YIELD SECURITIES RISK:
Below investment grade securities, sometimes called "junk bonds," are
considered speculative. These securities have greater risk of default than
higher rated securities. The market value of below investment grade securities
is more sensitive to individual corporate developments and economic changes than
higher rated securities. The market for below investment grade securities may be
less active than for higher rated securities, which can adversely affect the
price at which these securities may be sold. Less active markets may diminish a
Fund's ability to obtain accurate market quotations when valuing the portfolio
securities and calculating a Fund's net asset value. In addition, a Fund may
incur additional expenses if a holding defaults and a Fund has to seek recovery
of its principal investment. Below investment grade securities may also present
risks based on payment expectations. For example, these securities may contain
redemption or call provisions. If an issuer exercises these provisions in a
declining interest rate market the Fund would have to replace the security with
a lower yielding security resulting in a decreased return for investors.
ILLIQUID SECURITIES RISK:
Companies with non-publicly traded securities are not subject to disclosure
and other investor protection requirements and may be less liquid than publicly
traded securities. Illiquid securities may be difficult to resell at
approximately the price they are valued in the ordinary course of business in
seven days or less. When investments cannot be sold readily at the desired time
or price, a Fund may have to accept a lower price or may not be able to sell the
security at all, or forego other investment opportunities, all of which may have
an impact on the Fund.
INTEREST RATE RISK:
Bond prices generally rise when interest rates decline and decline when
interest rates rise. The longer the duration of a bond, the more a change in
interest rates affects the bond's price. Short-term and long-term interest rates
may not move the same amount and may not move in the same direction.
PREPAYMENT RISK:
Prices and yields of mortgage-backed securities assume the securities will be
redeemed at a given time. When interest rates decline, mortgage-backed
securities experience higher prepayments because the underlying mortgages are
repaid earlier than expected. A Fund's portfolio manager may be forced to invest
the proceeds from prepaid mortgage-backed securities at lower rates, which
results in a lower return for the Fund. When interest rates increase,
mortgage-backed securities experience lower prepayments because the underlying
mortgages may be repaid later than expected. This typically reduces the value of
the underlying securities.
REPURCHASE AND REVERSE REPURCHASE AGREEMENTS RISK:
A Fund entering into a repurchase agreement may suffer a loss if the other
party to the transaction defaults on is obligations and could be delayed or
prevented from exercising its rights to dispose of the underlying securities.
The value of the underlying securities might decline while the Fund seeks to
assert its rights. The Fund could incur additional expenses in asserting its
rights or may lose all or part of the income from the agreement. A reverse
repurchase agreement involves the risk that the market value of the securities
retained by a Fund may decline below the price of the securities the Fund has
sold but is obligated to repurchase at a higher price under the agreement.
RESTRICTED SECURITIES RISK:
Restricted securities (including Rule 144A securities) may be subject to
legal restraints on resale and, therefore, are typically less liquid than other
securities. The prices received from reselling restricted securities in
privately negotiated transactions may be less than those originally paid by a
Fund. Companies whose securities are restricted are not subject to the same
investor protection requirements as publicly traded securities.
STOCK MARKET RISK:
Stock market risk is the risk that the value of equity securities may
decline. Stock prices, including the price of GE Common Stock, change daily in
response to company activity and general economic
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GE S&S PROGRAM DISCLOSURE STATEMENT
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and market conditions. Stock prices may decline in value, even during periods
when equity securities in general are rising, or may not perform as well as the
market in general. Additional stock market risks may be introduced when a
particular equity security is traded on a foreign market. For more detail on the
related risks involved in foreign markets, see FOREIGN EXPOSURE RISK.
STYLE RISK:
Securities with different characteristics tend to shift in and out of favor
depending upon market and economic conditions as well as investor sentiment. A
Fund may underperform other funds that employ a different style. A Fund also may
employ a combination of styles that impact its risk characteristics. Examples of
different styles include growth and value investing, as well as those focusing
on large, medium, or small company securities.
GROWTH INVESTING RISK: Growth stocks may be more volatile than other stocks
because they are more sensitive to investor perceptions of the issuing company's
growth potential. Growth oriented funds will typically underperform when value
investing is in favor.
VALUE INVESTING RISK: Undervalued stocks may not realize their perceived
value for extended periods of time or may never realize their perceived value.
Value stocks may respond differently to market and other developments than other
types of stocks. Value oriented funds will typically underperform when growth
investing is in favor.
YEAR 2000 RISK:
The inability of computer systems worldwide to process correctly date-related
information from before, on, and after January 1, 2000 could cause difficulties
for systems' users (the "Year 2000 Issue"). The impact of failures by companies,
markets, or governments of countries in which a Fund invests to address
effectively the Year 2000 Issue may be felt well after January 1, 2000 and may
negatively impact its performance. In addition, a Fund could be adversely
affected if the computer systems used by its investment adviser or external
service providers do not correctly process such date-related information.
D. INVESTMENT RESTRICTIONS
1. PROGRAM MUTUAL FUND
Investments by the Program Mutual Fund are subject to the following
restrictions:
a. Moneys in the Program Mutual Fund will not be used in the underwriting of
securities or for the purchase of real estate, interests in real estate,
investment trusts, commodities or commodity contracts, or invested in
companies for the purpose of exercising control or management, or invested
in securities of registered investment companies.
b. Moneys in the Program Mutual Fund will not be lent to others, although
they may be applied to the purchase of bonds and debt securities of a type
publicly distributed or customarily purchased by institutional investors.
c. The Program Mutual Fund will not acquire any securities if immediately
after such acquisition and as a result thereof (a) the Program Mutual Fund
would hold more than 10% of the outstanding voting securities of any
issuer, (b) more than 5% of the value of the total assets in the Program
Mutual Fund would be represented by the securities of any one issuer
(except securities of the U.S. Government and its instrumentalities), (c)
more than 25% of the value of the total assets in the Program Mutual Fund
would be invested in any particular industry, or (d) more than 5% of the
value of the total assets in the Program Mutual Fund would be invested in
issuers which (including predecessors) have not been in continuous
operation for at least three years.
d. The Program Mutual Fund will not invest in securities of GE or its
affiliates, or in securities of the investment manager, and will not
during the existence of any underwriting syndicate purchase any securities
for which its investment manager is acting as principal underwriter. For
purposes of this restriction, purchases of securities from underwriting
syndicates in which PaineWebber Incorporated, an affiliate of the
49
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GE S&S PROGRAM DISCLOSURE STATEMENT
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Funds' investment adviser, General Electric Investment Corporation, is a
participant are not prohibited provided such investments are made in
accordance with the Investment Company Act of 1940, as amended
("Investment Company Act") and the rules thereunder.
e. The Program Mutual Fund will not purchase from or sell any of its
portfolio securities to GE or its affiliates or its investment manager or
any officer or director of either. This investment restriction is not
intended to prohibit the Program Mutual Fund from engaging in such
transactions with other investment companies or accounts managed by the
investment manager or the investment manager's affiliates when the
transactions are entered into in accordance with the Investment Company
Act and the rules thereunder.
f. The Program Mutual Fund will not engage in margin transactions or short
sales or participate in a joint trading account.
g. The Program Mutual Fund will not invest in puts, calls or similar options.
h. The Program Mutual Fund may borrow money from the GE Savings and Security
Trust and secure repayment by pledging assets of the Program Mutual Fund.
The Program Mutual Fund may also borrow money as a temporary measure to
meet cash or administrative needs. Except with respect to borrowings from
the GE Savings and Security Trust, the Program Mutual Fund will not
mortgage or pledge any of its assets.
2. THE LT INTEREST FUND, THE ST INTEREST FUND AND THE MONEY MARKET FUND
The LT Interest Fund, the ST Interest Fund and the Money Market Fund will
not:
a. purchase securities on margin or sell short or participate in a joint
trading account;
b. deal in options to buy or sell securities except to the extent permitted
by law;
c. borrow money or property except as a temporary measure to meet the cash or
administrative needs of such Funds. In no event will the amount of such
borrowings exceed 10% of such Funds' total assets taken at market value at
the time of such borrowing;
d. make cash loans to others except through the purchase of debt securities
in accordance with such Funds' investment objectives;
e. invest directly in real estate (except for investments by the LT Interest
Fund) or invest in interests in oil, gas or other mineral lease or
production agreements;
f. act as an underwriter of securities for other issuers except that such
Fund may acquire securities under circumstances where if they are later
resold it may be deemed to be an underwriter under the Securities Act of
1933, as amended ("Securities Act");
g. purchase securities for the purpose of exercising control or management;
h. pledge, mortgage or hypothecate any of its assets except, that, to secure
borrowings permitted by subparagraph c, it may pledge securities which,
together with all such securities previously so pledged, at the time of
pledge, do not exceed 10% of such Fund's total assets;
i. unless otherwise permitted by law, purchase from or sell directly to any
of its officers or Trustees or the officers or directors of General
Electric Investment Corporation, or any other affiliate (as defined in the
Investment Company Act) of such Fund or any affiliate of such affiliate,
portfolio securities or other property of such Fund; or
j. unless otherwise permitted by law, invest in securities of GE or its
affiliates, or in securities of an investment manager of such Fund and
will not during the existence of any underwriting syndicate purchase any
securities for which its investment manager is acting as principal
underwriter. For purposes of this restriction, purchases of securities
from underwriting syndicates in which PaineWebber Incorporated, an
affiliate of the Funds' investment adviser, is a participant are
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GE S&S PROGRAM DISCLOSURE STATEMENT
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not prohibited provided such investments are made in accordance with the
Investment Company Act and the rules thereunder.
In addition to the foregoing, the LT Interest Fund will not:
a. purchase any security if as a result of such purchase more than 25% of
its total assets would be invested in a particular industry;
b. purchase any security if as a result of such purchase more than 25% of its
total assets would be subject to legal or contractual restrictions on
resale; or
c. invest in the securities of registered investment companies.
III. INVESTMENT ADVISER
General Electric Investment Corporation, located at 3003 Summer
Street, Stamford, Connecticut 06904, serves as the investment adviser of each
Fund. General Electric Investment Corporation is a wholly owned subsidiary of
GE and is a registered investment adviser under the Investment Advisers Act of
1940, as amended ("Investment Advisers Act").
IV. FEES AND EXPENSES
Administrative costs of the Program, including participant recordkeeping and
transaction processing fees, are generally borne by GE. For GE Common Stock, ST
Interest Fund, Money Market Fund and Bonds, all other expenses associated with
these alternatives (including any investment management costs, shareholder
servicing agent expenses, transfer agent fees, custody and accounting expenses,
professional fees, registration fees and applicable taxes) are also generally
borne by GE. These other expenses, however, come out of the Program Mutual
Fund's and LT Interest Fund's assets and are reflected in each Fund's share
price and dividends. For a description of these Funds' expenses, please refer to
the Mutual Funds Annual Report, which is contained earlier in this document.
Annual operating expense of the GE Institutional International Equity Fund come
out of that Fund's assets and are reflected in its share price and dividends.
For a description of the fees and expenses of the GE Institutional International
Equity Fund, please refer to its current prospectus.
V. ADDITIONAL INFORMATION
The Trustees are responsible for providing certain additional information to
you, either directly or upon your request. The information provided directly to
you is contained in the Mutual Funds Annual Report, which is contained earlier
in this document, or the GE Institutional International Equity Fund Annual
Report, and includes: (i) a description of the annual operating expenses of
Program Mutual Fund, LT Interest Fund and GE Institutional International Equity
Fund, including the aggregate amount of such expenses expressed as a percentage
of average net assets, (ii) copies of financial statements of Program Mutual
Fund, LT Interest Fund and GE Institutional International Equity Fund, (iii) a
list of the securities comprising the portfolio of each diversified investment
alternative within the Program and the value of such securities as of the date
of the relevant annual report, and (iv) the investment performance of each
investment alternative.
The Trustees are also responsible for providing certain other information to
you upon your request. This information includes: (i) the value of units in each
of the Funds or shares of GE Common Stock, and (ii) the total value of units in
each of the Funds or shares of GE Common Stock held in a participant's account,
which may be obtained by calling 1-800-432-4313.
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GE S&S MUTUAL FUNDS INVESTMENT TEAM
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INVESTMENT ADVISER
General Electric Investment Corporation
PROGRAM TRUSTEES AND OFFICERS OF THE INVESTMENT ADVISER
John H. Myers, TRUSTEE, PRESIDENT AND CHIEF EXECUTIVE OFFICER, GENERAL
ELECTRIC INVESTMENT CORPORATION
Eugene K. Bolton, TRUSTEE, EXECUTIVE VICE PRESIDENT, DOMESTIC EQUITIES
Michael J. Cosgrove, TRUSTEE, EXECUTIVE VICE PRESIDENT, MUTUAL FUNDS
Ralph R. Layman, TRUSTEE, EXECUTIVE VICE PRESIDENT, INTERNATIONAL EQUITIES
Alan M. Lewis, TRUSTEE, EXECUTIVE VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
Robert A. MacDougall, TRUSTEE, EXECUTIVE VICE PRESIDENT, FIXED INCOME
Geoffrey R. Norman, EXECUTIVE VICE PRESIDENT, MARKETING
Donald W. Torey, TRUSTEE, EXECUTIVE VICE PRESIDENT, PRIVATE EQUITIES AND
REAL ESTATE
John J. Walker, TRUSTEE, EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER
PORTFOLIO MANAGERS
GE S&S PROGRAM MUTUAL FUND GE S&S SHORT-TERM INTEREST FUND
Team led by Eugene K. Bolton Team led by Robert A. MacDougall
GE S&S LONG-TERM INTEREST FUND GE S&S MONEY MARKET FUND
Team led by Robert A. MacDougall Team led by Robert A. MacDougall
INDEPENDENT AUDITORS
KPMG LLP
CUSTODIAN
State Street Bank & Trust Company
SHAREHOLDER SERVICING AGENT
Address all inquiries INSIDE the Program to:
GE S&SP Transaction Processing Center
P.O. Box 44079
Jacksonville, FL 32231-4079
Address all inquiries OUTSIDE the Program to:
GE Asset Management
GE Mutual Funds
P.O. Box 219631
Kansas City, MO 64121-9631
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SHAREHOLDER SERVICES
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DAILY VALUE, YIELDS/PERFORMANCE: 1-800-843-3359
INSIDETHE SAVINGS & SECURITY PROGRAM
Shares or units held INSIDE the Program have been credited to
your account as a result of contributions and investment
earnings. For a statement summarizing your account balance in
the Program, please refer to Your Personal Share statement (a
copy of which may be obtained at the web site listed below) or
GE Savings and Security Program Annual Statement. You may
obtain additional information and process account transactions
on investments held INSIDE the Program by calling:
GE S&SP TRANSACTION PROCESSING CENTER: 1-800-432-4313
OR VISIT BENEFITS.GE.COM
OUTSIDE THE SAVINGS & SECURITY PROGRAM
If shares of Program Mutual and LT Interest Funds have been
distributed to you from the Program, information on these
investments may be obtained by calling:
GE ASSET MANAGEMENT -- SHAREHOLDER SERVICES: 1-800-242-0134
OR VISIT WWW.GE.COM/MUTUAL FUNDS
<PAGE>
GE S&S FUNDS
3003 SUMMER STREET
STAMFORD, CT 06904-7900
DISTRIBUTOR
GE INVESTMENT DISTRIBUTORS INC.
MEMBER NASD AND SIPC
777 LONG RIDGE ROAD, BUILDING B
STAMFORD, CT 06927
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BULK RATE
U.S. POSTAGE
PAID
CANTON, MA
PERMIT NO. 313
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[GE LOGO OMITTED]
SS-2 (2/00)
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