<PAGE>   1
 
                            SCHEDULE 14A INFORMATION
 
          PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
                              EXCHANGE ACT OF 1934
 
FILED BY THE REGISTRANT /X/       FILED BY A PARTY OTHER THAN THE REGISTRANT / /
 
- --------------------------------------------------------------------------------
 
Check the appropriate box:
/X/ Preliminary Proxy Statement
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
 
                                 Teradyne, Inc.
                (Name of Registrant as Specified In Its Charter)
 
                                 Teradyne, Inc.
                   (Name of Person(s) Filing Proxy Statement)
 
PAYMENT OF FILING FEE (CHECK THE APPROPRIATE BOX):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
    14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
 
   1) Title of each class of securities to which transaction applies:
 
   2) Aggregate number of securities to which transaction applies:
 
   3) Per unit price or other underlying value of transaction computed pursuant
      to Exchange Act
      Rule 0-11:
 
   4) Proposed maximum aggregate value of transaction:
 
   Set forth the amount on which the filing fee is calculated and state how it
was determined.
 
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
    0-11(a)(2) and identify the filing for which the offsetting fee was paid
    previously. Identify the previous filing by registration statement number,
    or the Form or Schedule and the date of its filing.
 
   1) Amount Previously Paid: $0
 
   2) Form, Schedule or Registration Statement No.:
 
   3) Filing Party:
 
   4) Date Filed:
- --------------------------------------------------------------------------------

<PAGE>   2
 
                                 TERADYNE, INC.
                              321 HARRISON AVENUE
                          BOSTON, MASSACHUSETTS 02118
 
- -------------------------------------------------------------------------------
                    NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
- -------------------------------------------------------------------------------
 
TO THE SHAREHOLDERS:
 
     The Annual Meeting of Shareholders of Teradyne, Inc., a Massachusetts
corporation (the "Corporation"), will be held on Wednesday, May 24, 1995, at
10:00 A.M., at The First National Bank of Boston, 100 Federal Street (First
Floor), Boston, Massachusetts, for the following purposes:
 
          1. To elect three members to the Board of Directors to serve for a
     three-year term as Class III Directors.
 
          2. To approve a proposal to amend the Corporation's Restated Articles
     of Organization to authorize an increase in the authorized Common Stock,
     par value $.125 per share, of the Corporation from 75,000,000 to
     125,000,000 shares.
 
          3. To ratify the selection of the firm of Coopers & Lybrand L.L.P. as
     auditors for the fiscal year ending December 31, 1995.
 
          4. To transact such other business as may properly come before the
     meeting and any adjournments thereof.
 
     Shareholders entitled to notice of and to vote at the meeting shall be
determined as of the close of business on April 7, 1995, the record date fixed
by the Board of Directors for such purpose.
 
                                            By Order of the Board of Directors,
 
                                            RICHARD J. TESTA, Clerk
 
April 20, 1995
 
                            ------------------------
 
         SHAREHOLDERS ARE REQUESTED TO SIGN THE ENCLOSED PROXY CARD AND
           RETURN IT IN THE ENCLOSED STAMPED ENVELOPE BY RETURN MAIL.

<PAGE>   3
 
                                 TERADYNE, INC.
                              321 HARRISON AVENUE
                          BOSTON, MASSACHUSETTS 02118
 
                                ---------------
 
                                PROXY STATEMENT
 
                                 APRIL 20, 1995
 
     Proxies in the form enclosed with this proxy statement ARE SOLICITED BY THE
BOARD OF DIRECTORS OF TERADYNE, INC. (the "Corporation") for use at the Annual
Meeting of Shareholders (the "Annual Meeting") to be held on May 24, 1995, at
10:00 A.M., at The First National Bank of Boston, 100 Federal Street (First
Floor), Boston, Massachusetts.
 
     Only shareholders of record as of the close of business on April 7, 1995
(the "Record Date"), will be entitled to vote at the Annual Meeting and any
adjournments thereof. As of the Record Date,           shares (excluding
treasury shares) of Common Stock of the Corporation were issued and outstanding.
Each share outstanding as of the Record Date will be entitled to one vote, and
shareholders may vote in person or by proxy. Execution of a proxy will not in
any way affect a shareholder's right to attend the Annual Meeting and vote in
person. Any shareholder delivering a proxy has the right to revoke it only by
written notice to the Clerk delivered at any time before it is exercised,
including at the Annual Meeting.
 
     The persons named as attorneys in the proxies are officers and directors of
the Corporation. All properly executed proxies returned in time to be cast at
the Annual Meeting will be voted. With respect to the election of Directors, any
shareholder submitting a proxy has a right to withhold authority to vote for any
individual nominee by writing that nominee's name in the space provided on the
proxy. The proxies will be voted as stated below under "Election of Directors."
In addition to the election of Directors, the shareholders will consider and
vote upon proposals (i) to amend the Corporation's Restated Articles of
Organization to increase the amount of the Corporation's authorized Common
Stock, par value $.125 per share, from 75,000,000 to 125,000,000 shares and (ii)
to ratify the selection of auditors. Where a choice has been specified on the
proxy with respect to the foregoing matters, the shares represented by the proxy
will be voted in accordance with the specification and will be voted FOR if no
specification is indicated.
 
     A majority in interest of the outstanding shares represented at the meeting
in person or by proxy shall constitute a quorum for the transaction of business.
Votes withheld from any nominee, abstentions and broker "non-votes" are counted
as present or represented for purposes of determining the presence or absence of
a quorum for the meeting. A "non-vote" occurs when a nominee holding shares for
a beneficial owner votes on one proposal, but does not vote on another proposal
because the nominee does not have discretionary voting power and has not
received instructions from the beneficial owner. Directors are elected by a
plurality of the votes cast by shareholders entitled to vote at the meeting. On
all other matters being submitted to shareholders, an affirmative vote of at
least a majority of the shares present, or represented, and entitled to vote at
a meeting is required for approval. An automated system administered by the
Corporation's transfer agent tabulates the votes. The vote on each matter
submitted to shareholders is tabulated separately. Abstentions are included in
the number of shares present or represented and voting on each separate matter.
Broker "non-votes" are not so included.

<PAGE>   4
 
     The Board of Directors knows of no other matter to be presented at the
Annual Meeting. If any other matter should be presented at the Annual Meeting
upon which a vote properly may be taken, shares represented by all proxies
received by the Board of Directors will be voted with respect thereto in
accordance with the judgment of the persons named as attorneys in the proxies.
 
     An Annual Report to Shareholders, containing financial statements for the
fiscal year ended December 31, 1994, has been mailed to all shareholders
entitled to vote at the Annual Meeting. This proxy statement and the
accompanying proxy were first mailed to shareholders on or about April 20, 1995.
 
                             ELECTION OF DIRECTORS
 
     The Corporation's Board of Directors is divided into three classes. Each
class serves three years, with the terms of office of the respective classes
expiring in successive years. The present term of office for the directors in
Class III expires at the Annual Meeting. The nominees for election as Class III
directors are Messrs. Mulroney, Robbins and Testa, each of whom was elected at
the Annual Meeting of Shareholders held May 28, 1992. If re-elected, the Class
III nominees will hold office until the Annual Meeting of Shareholders to be
held in 1998, and until their successors shall have been elected and shall have
been qualified. Shares represented by all proxies received by the Board of
Directors and not so marked as to withhold authority to vote for any individual
nominee will be voted (unless one or more nominees are unable or unwilling to
serve) for the election of the Class III nominees. The Board of Directors knows
of no reason why any such nominee should be unable or unwilling to serve, but if
such should be the case, proxies will be voted for the election of some other
person or the Board of Directors will fix the number of directors at a lesser
number. Mr. Johnson, currently a Class II director, has informed the Board of
Directors that he will resign from the Board of Directors effective as of May
24, 1995.
 

<TABLE>
     The following table sets forth the nominees to be elected at the Annual Meeting and the other 
current directors, the year each nominee or director was first elected a director, the principal 
occupation of each of the nominees and directors during the past five years, and the ages of each 
of the nominees and directors.
 
<CAPTION>
                                                   PRINCIPAL OCCUPATION
     NOMINEE'S OR DIRECTOR'S NAME                 AND BUSINESS EXPERIENCE                YEAR
     AND YEAR NOMINEE OR DIRECTOR                     DURING THE LAST                  TERM WILL
        FIRST BECAME DIRECTOR                           FIVE YEARS                   EXPIRE/CLASS
     ----------------------------                 ----------------------             ------------
<S>                                       <C>                                           <C>
Alexander V. d'Arbeloff...............    Chairman of the Board of Directors
     1960                                   and President(1)                            1996/I
Edwin L. Artzt........................    Director(2)                                   1996/I
     1987
Albert Carnesale......................    Director(3)                                   1997/II
     1993
Daniel S. Gregory.....................    Director(4)                                   1996/I
     1977
Dwight H. Hibbard.....................    Director(5)                                   1997/II
     1983
Franklin P. Johnson, Jr...............    Director(6)                                   1997/II
     1974
John P. Mulroney......................    Director(7)                                   1995/III
     1983
James A. Prestridge...................    Executive Vice President(8)                   1997/II
     1992
</TABLE>

 
                                        2

<PAGE>   5
 

<TABLE>
<CAPTION>
                                                   PRINCIPAL OCCUPATION
     NOMINEE'S OR DIRECTOR'S NAME                 AND BUSINESS EXPERIENCE                YEAR
     AND YEAR NOMINEE OR DIRECTOR                     DURING THE LAST                  TERM WILL
        FIRST BECAME DIRECTOR                           FIVE YEARS                   EXPIRE/CLASS
     ----------------------------                 -----------------------            ------------
<S>                                       <C>                                          <C>
Owen W. Robbins.......................    Executive Vice President(9)                  1995/III
     1992
Richard J. Testa......................    Director, Secretary and Clerk(10)            1995/III
     1973
 
- ---------------
<FN> 
 (1) Mr. d'Arbeloff, 67, has been Chairman of the Board of Directors since 1977, President of the 
     Corporation since 1971 and a director since 1960. Mr. d'Arbeloff is also a director of Stratus 
     Computer, Inc., BTU International, Inc. and PRI Automation, Inc.
 
 (2) Mr. Artzt, 65, has served as Chairman of the Board of Directors and Chief Executive Officer of 
     the Procter & Gamble Corporation since 1990. Prior to that time, he served as director, Vice 
     Chairman of the Board of Directors and President of Procter & Gamble International. Mr. Artzt 
     is also a director of GTE Corporation, Delta Air Lines, Inc. and the American Express Company.
 
 (3) Mr. Carnesale, 58, has served as the Dean of the John F. Kennedy School of Government since 1991 
     and has served as Provost of Harvard University since July 1994. Mr. Carnesale has served as 
     Professor of Public Policy at the John F. Kennedy School of Government since 1974. Mr. Carnesale 
     is also a director of Environment Corp.
 
 (4) Since January 1992, Mr. Gregory, 66, has been a General Partner of various Greylock partnerships. 
     From January 1991 to January 1992, Mr. Gregory served as the Secretary of the Executive Office of 
     Economic Affairs for the Commonwealth of Massachusetts. Prior to January 1991, Mr. Gregory served 
     as Chairman of Greylock Management Corporation.
 
 (5) Mr. Hibbard, 71, Chairman of Cincinnati Bell Inc., served as Chief Executive Officer and Chairman 
     of Cincinnati Bell Inc. from 1984 to October 1993.
 
 (6) Mr. Johnson, 66, has been a venture capitalist since 1962 and a General Partner of Asset Management 
     Partners, a venture capital limited partnership since 1984. He is also a director of AmGen, Inc., 
     Boole and Babbage, Inc., Tandem Computers Incorporated, IDEC Pharmaceuticals Corporation and Trinzic
     Corp. Mr. Johnson, currently a Class II director, has informed the Board of Directors that he will 
     resign from the Board of Directors effective as of May 24, 1995.
 
 (7) Mr. Mulroney, 59, has served as Chief Operating Officer and President of Rohm & Haas Co. since 1986. 
     He is a director of Rohm & Haas Co. and Aluminum Co. of America.
 
 (8) Mr. Prestridge, 63, has served as Executive Vice President and director of the Corporation since 1992. 
     From 1982 to 1992, he served as Vice President of the Semiconductor Test Group of the Corporation.
 
 (9) Mr. Robbins, 65, has served as Executive Vice President and director of the Corporation since 1992. 
     From 1977 to 1992, he served as Vice President of the Corporation.
 
(10) Mr. Testa, 55, has been a partner at the law firm of Testa, Hurwitz & Thibeault since 1973. Testa, 
     Hurwitz & Thibeault serves as general counsel to the Corporation.
</TABLE>

 
BOARD OF DIRECTORS' MEETINGS AND COMMITTEES
 
     The Board of Directors of the Corporation met four times and took action by
unanimous written consent one time during the fiscal year ended December 31,
1994. The Audit and Finance Committee, which oversees the accounting and
financial functions of the Corporation, including matters relating to the
appointment and
 
                                        3

<PAGE>   6
 
activities of the Corporation's independent auditors, met three times during
1994. Messrs. Carnesale, Gregory and Mulroney are currently members of the Audit
and Finance Committee. The Management Compensation and Development Committee
(the "Compensation Committee"), which determines the compensation of the
Corporation's executive officers and administers the Corporation's stock option
and certain other benefit plans, met three times during 1994. Messrs. Artzt,
Hibbard, Johnson and Testa are currently members of the Compensation Committee.
The Board Composition and Agenda Committee, which acts, in part, as the
Corporation's nominating committee, and is responsible for recommending
individuals to be nominated for election to the Board of Directors and
recommending the time, location and agenda of the meetings of the Board of
Directors, did not meet during 1994. Messrs. Artzt, d'Arbeloff, Mulroney and
Prestridge are currently members of the Board Composition and Agenda Committee.
Shareholders wishing to suggest nominees for election to the Board of Directors
should direct such suggestions to the Clerk of the Corporation at the
Corporation's principal address in accordance with the nomination procedure set
forth in the Corporation's By-Laws. All directors attended at least 75% of the
aggregate of the total number of meetings of the Board of Directors and the
total number of meetings of all committees of the Board on which they served,
except for Mr. Artzt.
 
DIRECTOR COMPENSATION
 
     All non-employee directors are compensated at the rate of $15,000 per year
and $1,500 per meeting attended, plus reimbursement of reasonable expenses. The
per meeting compensation of non-employee directors was increased from $1,000 per
meeting to $1,500 per meeting in August 1994. Directors who are employees of the
Corporation receive no compensation in their capacity as a director. See also
"1987 Non-Employee Director Stock Option Plan."
 
1987 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
 
     The 1987 Non-Employee Director Stock Option Plan (the "1987 Plan") was
adopted by the Board of Directors of the Corporation on March 12, 1987 and
approved by the shareholders on May 8, 1987. The 1987 Plan is administered by
the Compensation Committee. However, the time of grant, number of shares
granted, exercise price and vesting schedule are established by the terms of the
1987 Plan and are not subject to the discretion of the Compensation Committee or
any person. Only non-employee directors may participate in the 1987 Plan.
 
     Under the 1987 Plan, all new non-employee directors elected after January
1, 1992 receive an automatic grant of an option to purchase 10,000 shares of
Common Stock. An additional annual grant of 5,000 shares is automatically made
to each non-employee director on the date of the first meeting of the Board of
Directors in each year. All options are non-statutory stock options, have an
exercise price equal to the fair market value on the date of grant, vest
annually at the rate of 25% and have a term of five years. Unless terminated
sooner, the 1987 Plan will terminate on March 12, 1997.
 
     The 1987 Plan authorizes the issuance of a maximum of 400,000 shares of
Common Stock, subject to adjustment for capital changes. On December 31, 1994,
options to purchase 168,750 shares of the Corporation's Common Stock under the
1987 Plan were outstanding at a weighted average exercise price of $17.46.
 
                                        4

<PAGE>   7
 
        SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
 
     The following table sets forth as of April 7, 1995 information relating to
the beneficial ownership of the Corporation's Common Stock by each Director,
each executive officer named in the Summary Compensation Table on page 7, and by
all directors and executive officers as a group.
 

<TABLE>
<CAPTION>
                                                                  AMOUNT AND
                                                                   NATURE OF      PERCENT OF
                                  NAME                          OWNERSHIP(1)(2)      CLASS
          ----------------------------------------------------  ---------------   -----------
          <S>                                                   <C>               <C>
          Alexander V. d'Arbeloff+............................     1,147,286(3)        %
          George V. d'Arbeloff+...............................        18,186           *
          Edwin L. Artzt......................................        16,375           *
          Albert Carnesale....................................         3,950           *
          Daniel S. Gregory...................................        14,648           *
          Dwight H. Hibbard...................................        12,700(4)        *
          Franklin P. Johnson, Jr.............................        44,100(5)        *
          John P. Mulroney....................................        16,165           *
          James A. Prestridge.................................        68,154(6)        *
          Owen W. Robbins.....................................        77,020           *
          George W. Chamillard................................        51,430           *
          Richard J. Testa....................................         7,250           *
          All executive officers and directors as a
            group (19 persons)(7).............................     1,708,233           %

 
- ---------------   
<FN>
    * less than 1%
    + Mr. Alexander d'Arbeloff and Mr. George d'Arbeloff are brothers.
  (1) Unless otherwise indicated, the named person possesses sole voting and dispositive
      power with respect to the shares.
  (2) Includes shares of Common Stock which have not been issued but which are subject to
      options which either are presently exercisable or will become exercisable within 60
      days, as follows: Mr. Alexander d'Arbeloff, 98,000 shares; Mr. George d'Arbeloff, 7,600
      shares; Mr. Prestridge, 39,600 shares; Mr. Robbins, 44,600 shares; Mr. Chamillard,
      37,200 shares; each non-employee director of the Corporation (except Mr. Carnesale, Mr.
      Gregory and Mr. Testa), 12,500 shares; Mr. Carnesale 3,750 shares; Mr. Gregory, 7,500
      shares; Mr. Testa, 1,250 shares; all directors and executive officers as a group,
      473,400 shares.
  (3) Includes 67,404 shares of Common Stock held by Mr. d'Arbeloff's wife and 5,600 shares
      of Common Stock held in trust for the benefit of Mr. d'Arbeloff's children, as to all
      of which shares Mr. d'Arbeloff disclaims beneficial ownership. Also includes 75,000
      shares owned by The d'Arbeloff Foundation, a private charitable foundation of which Mr.
      d'Arbeloff is the founder and a co-trustee, as to all of which shares Mr. d'Arbeloff
      disclaims beneficial ownership.
  (4) Includes 100 shares of Common Stock held by Mr. Hibbard's wife, as to all of which
      shares Mr. Hibbard disclaims beneficial ownership.
  (5) Includes 8,000 shares of Common Stock held in trust for the benefit of Mr. Johnson's
      wife and children, as to all of which shares Mr. Johnson disclaims beneficial
      ownership.
</TABLE>

 
                                        5

<PAGE>   8
 
  (6) Includes 28,554 shares of Common Stock held in a living trust for the 
      benefit of Mr. Prestridge and his wife.
  (7) The group is comprised of the individuals named in the Summary 
      Compensation Table on page 7, the remaining executive officers of the
      Corporation, and those persons who were directors of the Corporation on
      April 7, 1995. Includes 471,000 shares which the directors and executive
      officers as a group have the right to acquire by exercise of stock options
      granted under the Corporation's stock plans. In addition, includes 82,504 
      shares held by family members of executive officers and directors, as to
      which shares the applicable officer or director disclaims beneficial
      ownership.
 
     Based on a review of the forms and written representations received by the
Corporation pursuant to Section 16(a) of the Securities Exchange Act of 1934,
the Corporation believes that during the fiscal year January 1, 1994 through
December 31, 1994, the directors and executive officers complied with all
applicable Section 16 filing requirements.
 

<TABLE>
     Listed below are certain persons who to the knowledge of the Corporation own beneficially, as of the 
dates indicated below, more than five percent of the Corporation's Common Stock outstanding at such dates.
 
<CAPTION>
                NAME AND ADDRESS                           AMOUNT AND NATURE   PERCENT OF
              OF BENEFICIAL HOLDER                            OF OWNERSHIP       CLASS
              --------------------                         -----------------   ----------
        <S>                                                  <C>                 <C>
        AIM Management Group Inc......................       2,186,300(1)         5.9%
          P.O. Box 4333
          Houston, Texas

        FMR Corp......................................       4,337,300(2)        11.8%
          82 Devonshire Street
          Boston, Massachusetts

        Norwest Corporation...........................       2,253,425(3)         6.1%
          Norwest Center
          Sixth and Marquette
          Minneapolis, Minnesota
 
- ---------------
<FN> 
(1) According to Schedule 13G dated February 3, 1995. As of such date, AIM Management Group Inc. had shared 
    voting power as to 2,168,300 shares and shared dispositive power as to 2,186,300 shares with its wholly owned
    subsidiaries, AIM Advisors, Inc. ("AIM Advisors") and AIM Capital Management Inc. ("AIM Capital"). This number 
    includes 758,800 shares beneficially owned by AIM Advisors as a result of its serving as investment advisor to 
    various investment companies registered under Section 8 of the Investment Company Act of 1940 (the "1940 Act"); 
    1,425,000 shares beneficially owned by AIM Advisors and AIM Capital as a result of their serving as investment 
    advisor and subadvisor, respectively, to investment companies registered under Section 8 of the 1940 Act; and 
    2,500 shares beneficially owned by AIM Capital as a result of its serving as investment manager for various 
    private investment accounts. AIM Management Group Inc. has shared voting and dispositive power with respect to 
    all the shares it beneficially owns.
 
(2) According to Schedule 13G dated February 14, 1995. As of such date, FMR Corp. beneficially owned 4,337,300 shares 
    of the Common Stock of the Corporation. This number includes 4,208,700 shares beneficially owned by Fidelity 
    Management & Research Company ("Fidelity Management"), as a result of its serving as investment advisor to various 
    investment companies registered under Section 8 of the Investment Company Act of 1940 and as investment adviser to 
    certain other funds which are generally offered to limited groups of investors; 24,300 shares beneficially owned by 
    Fidelity Management Trust Company, as a result of its serving as trustee or managing agent for various private 
    investment accounts, primarily employee benefit plans, and as investment adviser to certain other funds which are 
    generally
 
</TABLE>

                                                        6

<PAGE>   9
 
    offered to limited groups of investors; and 104,300 shares beneficially
    owned by Fidelity International Limited, as a result of its serving as
    investment adviser to various non-U.S. investment companies. The ownership
    of one investment company, Fidelity Magellan Fund, amounted to 3,604,700
    shares of the Common Stock of the Corporation. Edward C. Johnson 3d and FMR
    Corp., through control of Fidelity Management, each has sole power to
    dispose of 4,208,700 shares of the Common Stock of the Corporation. FMR
    Corp. has sole voting power with respect to 128,600 shares and sole
    dispositive power with respect to 4,337,300 shares. Fidelity International
    Limited has sole voting and dispositive power with respect to all the shares
    it beneficially owns.
 
(3) According to Schedule 13G dated January 31, 1995. As of such date, Norwest
    Corporation ("Norwest") had sole voting power as to 2,113,325 shares, shared
    voting power as to 10,800 shares, sole dispositive power as to 2,252,225
    shares and shared dispositive power as to 900 shares. The 2,253,425 shares
    beneficially owned by Norwest include 2,218,925 shares beneficially owned by
    Norwest Colorado, Inc. through its subsidiaries, of which 2,218,775 shares
    are deemed to be beneficially owned by Norwest Bank Colorado, National
    Association. Shares held by Norwest and its subsidiaries are held in a
    fiduciary capacity. Accordingly, Norwest and its subsidiaries disclaim
    beneficial ownership of such shares.
 
                             EXECUTIVE COMPENSATION
 

<TABLE>
     The following Summary Compensation Table sets forth the compensation
received by the Chief Executive Officer and the four other most highly
compensated executive officers of the Corporation for the three fiscal years
most currently ended.
 
                           SUMMARY COMPENSATION TABLE
 
<CAPTION>
                                                                         LONG-TERM
                                                                        COMPENSATION
                                                                         AWARDS(3)
                                                                      ---------------
                                             ANNUAL COMPENSATION         SECURITIES
     NAME AND                            --------------------------      UNDERLYING        ALL OTHER
PRINCIPAL POSITION                       YEAR   SALARY(1)  BONUS(2)   OPTIONS/SARS(#)    COMPENSATION
- ------------------                       ----   --------   --------   ---------------    ------------
<S>                                      <C>    <C>        <C>             <C>              <C>
Alexander V. d'Arbeloff................. 1994   $294,546   $378,593        40,000           $30,151
  Chairman of the                        1993    288,768    289,665        45,000            10,047
  Board of Directors                     1992    288,768    258,491        40,000             6,866
  and President

Owen W. Robbins......................... 1994    211,512    214,690        30,000            19,353
  Executive Vice                         1993    207,360    163,381        34,000            10,047
  President                              1992    207,360    145,183        25,000             6,866

James A. Prestridge..................... 1994    211,512    214,690        30,000            19,105
  Executive Vice                         1993    201,360    158,652        34,000            10,047
  President                              1992    201,360    148,911        25,000             6,866

George W. Chamillard.................... 1994    182,790    179,535        30,000            14,354
  Executive Vice                         1993    167,580     95,228        30,000            10,047
  President                              1992    163,590     84,653        16,000             6,719

George V. d'Arbeloff.................... 1994    175,818    142,436        22,000            15,022
  Vice President                         1993    172,368    115,240        25,000             6,386
                                         1992    165,984    102,987        16,000                --
</TABLE>

 
                                                       7

<PAGE>   10
 
- ---------------
[FN] 
(1) The amounts in the "Salary" column represent the annual base salary for each
    of the named officers, which is paid monthly.
 
(2) The amounts in the "Bonus" column represent the Variable Compensation earned
    in 1994 pursuant to the Corporation's Cash Compensation Plan and Cash Profit
    Sharing Plan.
 
(3) The named executive officers have not as of December 31, 1994 received from
    the Corporation any grants of restricted stock as compensation.
 
(4) The amounts in the "All Other Compensation" column represent the matching
    contributions that the Corporation makes to the Savings Plan and
    Supplemental Savings Plan.
 
     The following table provides information with respect to stock option
grants by the Corporation to the named executive officers in 1994. The
Corporation did not grant any stock appreciation rights to the named executive
officers in 1994.
 

<TABLE>
                                  OPTION/SAR GRANTS IN LAST FISCAL YEAR
 
<CAPTION>
                                                                                          POTENTIAL REALIZED
                                                                                           VALUE AT ASSUMED
                                            PERCENTAGE OF                                ANNUAL RATES OF STOCK
                               NUMBER OF    TOTAL OPTIONS                                 PRICE APPRECIATION
                              SECURITIES      GRANTED TO                                 OVER THE OPTION TERM
                              UNDERLYING      EMPLOYEES       EXERCISE                            (2)
                                OPTIONS       IN FISCAL        PRICE      EXPIRATION     --------------------
NAME                          GRANTED(1)         YEAR        ($/SHARE)       DATE         5%              10%
- ----                          ----------    -------------    ---------    ----------      --              ---
<S>                              <C>             <C>           <C>          <C>          <C>          <C>
Alexander V. d'Arbeloff.....     40,000          4.36%         $25.75       8/03/99      $284,570     $628,825
Owen W. Robbins.............     30,000          3.27%         $25.75       8/03/99      $213,427     $471,618
James A. Prestridge.........     30,000          3.27%         $25.75       8/03/99      $213,427     $471,618
George W. Chamillard........     30,000          3.27%         $25.75       8/03/99      $213,427     $471,618
George V. d'Arbeloff........     22,000          2.40%         $25.75       8/03/99      $156,513     $345,853
 
- ---------------
<FN> 
(1) Stock options were granted under the Corporation's 1991 Plan at an exercise price equal to the fair market value of 
    the Corporation's Common Stock on the date of grant. The options have a term of five years from the  date of grant. 
    The options become exercisable as follows: 20% on the date of grant and, following the first year of grant, 20% on 
    an annual basis.
 
(2) Amounts reported in these columns represent amounts that may be realized upon exercise of the options immediately prior 
    to the expiration of their term assuming the specified compounded rates of appreciation (5% and 10%) of the Corporation's 
    Common Stock over the term of the options. These numbers are calculated based on rules promulgated by the Securities and 
    Exchange Commission and do not reflect the Corporation's estimate of future stock price increases. Actual gains, if any, 
    on stock option exercises and Common Stock holdings are dependent on the timing of such exercise and the future performance 
    of the Corporation's Common Stock. There can be no assurance that the rates of appreciation assumed in this table can be 
    achieved or that the amounts reflected will be received by the individuals.
</TABLE>

 
                                                          8

<PAGE>   11
 

<TABLE>
     The following table provides information on stock option exercises in
fiscal 1994 by the named executive officers and the value of such officers'
unexercised options at December 31, 1994.
 
         AGGREGATED OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUES
 
<CAPTION>
                                 SHARES
                                ACQUIRED                  NUMBER OF SECURITIES
                                  UPON                   UNDERLYING UNEXERCISED         VALUE OF UNEXERCISED
                                 OPTION                      OPTIONS HELD AT           IN-THE-MONEY OPTIONS AT
                                EXERCISE                    DECEMBER 31, 1994             DECEMBER 31, 1994
                                 DURING      VALUE     ---------------------------   ---------------------------
      NAME                        1994      REALIZED   EXERCISABLE   UNEXERCISABLE   EXERCISABLE   UNEXERCISABLE
      ----                      --------    --------   -----------   -------------   -----------   -------------
<S>                               <C>       <C>          <C>             <C>         <C>            <C>
Alexander V. d'Arbeloff.......         0    $      0     117,000         83,000      $ 2,447,125    $ 1,156,625
Owen W. Robbins...............    42,000    $867,350      34,600         59,400      $   506,900    $   810,350
James A. Prestridge...........    22,000    $476,750      44,600         59,400      $   776,900    $   810,350
George W. Chamillard..........    20,000    $384,200      36,400         51,600      $   622,150    $   665,150
George V. d'Arbeloff..........     6,400    $120,400      24,000         42,200      $   349,400    $   567,125
</TABLE>

 
RETIREMENT BENEFITS
 
     The Corporation has established a Retirement Plan for the purpose of
providing a lifetime annual income upon retirement to substantially all
employees, including officers, of the Corporation and its United States
subsidiaries. Membership in the Retirement Plan begins after one year of
employment with the Corporation. The Retirement Plan provides for credit toward
retirement income for years of employment with the Corporation prior to January
1, 1994 based upon a formula tied to average compensation from 1989 to 1993. For
years of service after December 31, 1993, credit towards retirement income is
determined on a yearly basis and is equal to the sum for each year of credited
service under the Retirement Plan of (1) .75% of the employee's compensation for
the year which is under the defined covered compensation for the year and (2)
1.5% of the amount of the employee's compensation for the year that exceeds the
covered compensation for the year. The covered compensation under the Retirement
Plan is based on the average of the social security wage basis in effect during
the thirty-five years up to and including normal retirement age. However,
federal tax law limitations on the total amount of benefits which a participant
may receive under qualified retirement plans may limit some participants'
benefits under the Retirement Plan.
 
     Under the Retirement Plan, for participants employed by the Corporation on
or after January 1, 1989, accumulated annual retirement income vests partially
after three years of service with the Corporation and becomes fully vested after
seven years of service or upon normal, early or disability retirement. Benefits
are payable in the form of an annuity either at normal retirement age, upon
early retirement or upon disability. The Retirement Plan also provides for
certain benefits to a surviving spouse.
 
     The Corporation also maintains the Teradyne, Inc. Supplemental Executive
Retirement Plan (the "SERP"). Under the SERP, annual pensions for Messrs.
Alexander d'Arbeloff, Robbins, Prestridge, George d'Arbeloff, Chamillard and
other senior managers are computed based on model compensation. See discussion
of model compensation under Management and Compensation Development Committee
Report. The pension formula is identical to that of the qualified plan, except
an employee's annual pension is based on the average of the employee's last five
years of model compensation. The resulting benefit is reduced by the benefit
received from the qualified Retirement Plan.
 
                                        9

<PAGE>   12
 

<TABLE>
     The following table shows the estimated annual benefits payable to covered participants in the United States upon 
retirement at age 65 under both the Retirement Plan and the SERP. The amounts shown are computed on a single life
annuity basis and are not subject to deductions for Social Security benefits or other amounts. Remuneration for purposes 
of the table is based upon an employee's average model compensation for the five year period preceding retirement.
 
                                               PENSION PLAN TABLE
 
<CAPTION>
                                                                     YEARS OF SERVICE
                                         -----------------------------------------------------------------------
REMUNERATION                             10             15           20           25           30             35
- ------------                             --             --           --           --           --             --
<S>                                     <C>          <C>          <C>          <C>          <C>          <C>
$50,000.............................    $  5,600     $  8,500     $ 11,300     $ 14,100     $ 17,000     $ 19,800
100,000.............................      13,100       19,700       26,300       32,900       39,500       46,100
150,000.............................      20,600       31,000       41,300       51,600       62,000       72,300
200,000.............................      28,100       42,200       56,300       70,400       84,500       98,600
250,000.............................      35,600       53,500       71,300       89,100      107,000      124,800
300,000.............................      43,100       64,700       86,300      107,900      129,500      151,100
350,000.............................      50,600       76,000      101,300      126,600      152,000      177,300
400,000.............................      58,100       87,200      116,300      145,400      174,500      203,600
450,000.............................      65,600       98,500      131,300      164,100      197,000      229,800
500,000.............................      73,100      109,700      146,300      182,900      219,500      256,100
550,000.............................      80,600      121,000      161,300      201,600      242,000      282,300
600,000.............................      88,100      132,200      176,300      220,400      264,500      308,600
650,000.............................      95,600      143,500      191,300      239,100      287,000      334,800
700,000.............................     103,100      154,700      206,300      257,900      309,500      361,100
750,000.............................     110,600      166,000      221,300      276,600      332,000      387,300
</TABLE>

 
     The executive officers named in the Summary Compensation Table have been
credited as of January 1, 1995 with the following years of service: Mr.
Alexander d'Arbeloff, 34 years; Mr. Robbins, 24 years; Mr. Prestridge, 25 years;
Mr. George d'Arbeloff, 28 years; and Mr. Chamillard, 25 years.
 
            MANAGEMENT COMPENSATION AND DEVELOPMENT COMMITTEE REPORT
 
OVERVIEW AND PHILOSOPHY
 
     The Corporation's executive compensation program is administered by the
Management Compensation and Development Committee of the Board of Directors (the
"Compensation Committee"), which is composed entirely of non-employee directors.
The Compensation Committee is responsible for developing and making
recommendations to the Board of Directors with respect to the Corporation's
compensation policies. In addition, the Compensation Committee, pursuant to
authority delegated by the Board of Directors, determines on an annual basis the
compensation to be paid and stock option awards to be made to each of the
executive officers.
 
     The Compensation Committee's executive compensation policies are designed
to provide competitive levels of compensation that assist the Corporation in
attracting and retaining qualified executives. In setting compensation levels
for executive officers, the Compensation Committee takes into account such
factors as: the Corporation's past history and future expectations; the general
and industry-specific business environment; annual and long-term performance
goals; and corporate and group performance.
 
EXECUTIVE OFFICER COMPENSATION PROGRAM
 
     The Corporation's executive officer compensation program consists of
compensation received pursuant to the Corporation's Cash Compensation Plan,
long-term incentive compensation in the form of stock options, Cash Profit
Sharing Plan and various benefits, including medical, savings and retirement
plans generally available to employees of the Corporation.
 
     Under the Corporation's Cash Compensation Plan, the Compensation Committee
assigns to each senior employee of the Corporation, including all executive
officers, at the beginning of each year, a "model
 
                                       10

<PAGE>   13
 
compensation" amount. The model compensation amount is based on salary surveys
of similarly sized electronics companies, and on an as adjusted basis, larger
sized companies, some of which are represented in the S&P High Technology
Composite Index appearing in the Performance Graph on page 13 herein. The model
compensation amount is consistent with the Corporation's internal compensation
structure.
 
     Once model compensation for each participant has been determined, the
actual cash compensation paid to each employee under the Cash Compensation Plan
is comprised of two components: (1) a fixed monthly salary and (2) an annual
variable amount based upon overall corporate and group performance (referred to
herein as "Variable Compensation"). The fixed salary amount is set at a level
which is below the model compensation, and the variable portion is based upon
factors which, if achieved, would entitle the employee to reach or exceed model
compensation. The Corporation's goal, however, is to pay each employee his or
her model compensation over time.
 
     The amount of Variable Compensation each participant receives is a function
of four factors:
 
          (A) The employee's base annual salary as of the end of the preceding
     year;
 
          (B) Overall corporate performance versus goal;
 
          (C) Performance of the individual business groups versus goal; and
 
          (D) The employee's "variable compensation factor," which is determined
     by the Compensation Committee on the basis of responsibility and experience
     level.
 
     An employee's "variable compensation factor" is a percentage of his or her
base annual salary starting at 10% for new participants. At greater levels of
responsibility and experience, the variable compensation factor may increase to
more than 100% of base annual salary. An employee's model compensation is set
assuming a 50% payout of the variable compensation factor. Accordingly, in a
given year an employee may achieve more or less than his or her model
compensation depending on corporate and business group performance.
 
     At year end, the Compensation Committee evaluates the Corporation's overall
performance versus goal and each individual group's performance versus goal.
Given the dynamics of the business, the Corporation's Cash Compensation Plan
relies heavily on the Compensation Committee's subjective judgment of
performance.
 
     Specifically for 1994, in determining Variable Compensation payouts, the
Compensation Committee took the following factors into consideration in
evaluating both overall corporate performance and the performance of the
Corporation's individual business groups: (1) the extent to which quantitative
and qualitative plans were met for the year, with a particular emphasis on
profitability, growth of sales, growth of bookings, and increase in market
share; (2) the extent to which each business group became a role model in the
implementation of "Total Quality Management"; (3) the extent to which the
financial results for the year were consistent with the Corporation achieving
its mid-term business plan; and (4) whether each group was in a stronger
strategic position at the end of the year than at the beginning. The
Compensation Committee generally weighs each of the four factors equally in
setting Variable Compensation amounts, although for the last three fiscal years
the Compensation Committee has viewed factor (1) referred to above as the most
important factor in setting Variable Compensation amounts as the Corporation has
put increasing emphasis on profit discipline. The factors are reviewed by the
Compensation Committee based upon the performance of the business group in which
each executive officer serves rather than upon the individual performance of the
executive officer. In 1994, the range of total cash compensation to model
compensation for all executive officers was from 110% of model compensation to
128.5% of model compensation.
 
     The Corporation's stock option program is the Corporation's long-term
incentive plan for employees, including executive officers. The objectives of
the program are to align executive return with shareholder return and to create
and implement a program which will attract and retain talented employees and
executives. Stock options are awarded annually to employees, including the Chief
Executive Officer, based upon an
 
                                       11

<PAGE>   14
 
employee's relative contribution and responsibility within the Corporation. The
factors taken into account by the Compensation Committee in determining each
executive officer's relative contribution and responsibility within the
Corporation include: the executive officer's level of model compensation, the
executive officer's position, the responsibilities currently being performed by
the executive officer, and the responsibilities expected to be performed by the
executive officer. The individual factors are reviewed subjectively by the
Compensation Committee when determining stock option awards for each executive
officer. The Corporation conducts surveys of various companies, some of which
appear in the Performance Graph's S&P High Technology Composite Index, to verify
that the relative percentages of stock options granted to its employees, its
Chief Executive Officer and its other executive officers, are consistent with
high technology industry practice, are within the range of stock options granted
by the surveyed companies, and are competitive with the relative percentages of
stock options granted by the surveyed companies.
 
CHIEF EXECUTIVE OFFICER COMPENSATION
 
     Mr. d'Arbeloff's cash compensation for 1994 awarded pursuant to the
Corporation's Cash Compensation Plan was $639,168, which is approximately 28.5%
more than Mr. d'Arbeloff's 1994 model compensation of $497,265. Mr. d'Arbeloff's
1994 cash compensation awarded pursuant to the Corporation's Cash Compensation
Plan is a 13.8% increase over his 1993 cash compensation. Mr. d'Arbeloff's fixed
salary amount was $294,546 for 1994 and was set by the Compensation Committee,
in conjunction with his "model compensation" amount, based upon salary surveys
of chief executive officers for similarly sized electronics companies. Mr.
d'Arbeloff's Variable Compensation payout was $344,622 for 1994. Mr.
d'Arbeloff's Variable Compensation payouts are determined based upon the same
factors as the Corporation's other executive officers who have general
responsibilities within the Corporation rather than responsibilities for one
specific business group within the Corporation. Each of such executive officer's
Variable Compensation payout is based 50% upon the performance of the
Corporation as a whole and 50% upon the average of the performances of each of
the individual business groups within the Corporation. Mr. d'Arbeloff also
received cash compensation in the amount of $33,971 in 1994 pursuant to the
Corporation's Cash Profit Sharing Plan. Cash compensation awards under such
plan, which are calculated pursuant to a uniform formula based on a percentage
of the recipient's salary, are generally made to all employees of the
Corporation on an equal basis.
 
     The stock options granted to Mr. d'Arbeloff during fiscal 1994 are
consistent with the design of the overall program and are shown in the Summary
Compensation Table above. Mr. d'Arbeloff's 40,000 shares, which represented
4.36% of the total option shares awarded to all employees during fiscal 1994,
placed him at the median of the external surveys. In assessing Mr. d'Arbeloff's
individual performance for the year for purposes of his stock option awards, the
Compensation Committee concluded that, on balance, Mr. d'Arbeloff had achieved
overall positive results for the individual factors for which he was evaluated.
A general description of these factors is detailed above under the description
of the Corporation's stock option program. Although the aggregate number of
stock options awarded to Mr. d'Arbeloff for fiscal 1994 was less than the
aggregate number of stock options awarded to him for fiscal 1993, Mr.
d'Arbeloff's percentage of the total stock options awarded to all employees of
the Corporation actually increased.
                                              MANAGEMENT COMPENSATION AND
                                                 DEVELOPMENT COMMITTEE
 
                                                  Edward L. Artzt
                                                  Dwight H. Hibbard
                                                  Franklin P. Johnson, Jr.
                                                  Richard J. Testa
 
                                       12

<PAGE>   15
 
COMPENSATION COMMITTEE INTERLOCK AND INSIDER PARTICIPATION
 
     Messrs. Artzt, Hibbard, Johnson and Testa comprise the Compensation
Committee. Richard J. Testa is a member of the law firm Testa, Hurwitz &
Thibeault in Boston, Massachusetts. Such law firm served as general counsel for
the Corporation during the fiscal year 1994 and the Corporation expects to
retain the services of such firm for the fiscal year 1995.
 
                 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
 
     On March 15, 1994, Joseph B. Lassiter, III resigned from his office as a
Vice President of the Corporation. Pursuant to the terms of an agreement, the
Corporation continued to pay Mr. Lassiter as an employee at his 1994 model
compensation rate of $19,076 per month through August 22, 1994, and at the rate
of $1,000 per month thereafter through March 31, 1995. The Corporation also
agreed to continue Mr. Lassiter's eligibility to participate in the
Corporation's health, savings, and pension plans through December 10, 1994.
 
                            PERFORMANCE GRAPH (1)(2)
 
     The following graph compares the change in the Corporation's cumulative
total shareholder return in its Common Stock with the Standard & Poor's 500
Index and the Standard & Poor's High Technology Composite Index. The comparison
assumes $100.00 was invested on December 31, 1989 in the Corporation's Common
Stock and in each of the foregoing indices and assumes reinvestment of
dividends, if any.
 

<TABLE>
<CAPTION>
                                                                  S & P High
                                                                  Technology
      Measurement Period           Teradyne,       S & P 500       Composite
    (Fiscal Year Covered)            Inc.            Index           Index
<S>                                 <C>             <C>             <C>
1989                                100.00          100.00          100.00
1990                                 63.64           96.89          102.10
1991                                144.32          126.28          116.50
1992                                139.77          135.88          121.35
1993                                252.27          149.52          149.25
1994                                307.95          151.55          173.98
</TABLE>

 
                                       13

<PAGE>   16
 
- ---------------
[FN] 
(1) This graph is not "soliciting material," is not deemed filed with the
    Securities and Exchange Commission and is not to be incorporated by
    reference in any filing of the Corporation under the Securities Act of 1933
    or the Securities Exchange Act of 1934 whether made before or after the date
    hereof and irrespective of any general incorporation language in any such
    filing.
 
(2) The stock price performance shown on the graph is not necessarily indicative
    of future price performance. Information used on the graph was obtained from
    Hewitt Associates, a source believed to be reliable, but the Corporation is
    not responsible for any errors or omissions in such information.
 
            PROPOSAL TO AMEND THE RESTATED ARTICLES OF ORGANIZATION
 
     The Board of Directors has voted to recommend to the shareholders that the
Corporation amend the Corporation's Restated Articles of Organization to
increase the number of authorized shares of Common Stock, par value $.125 per
share, from 75,000,000 shares to 125,000,000 shares (the "Amendment").
 
     If the Amendment is approved and after giving effect to shares reserved for
issuance under the Corporation's stock plans, the Board of Directors will have
the authority to issue   (as of April 7, 1995) shares of Common Stock without
further shareholder approval. The Board of Directors of the Corporation believes
that the increase in the number of authorized shares of Common Stock is in the
best interests of the Corporation and its shareholders. The Board of Directors
believes that the authorized number of shares of Common Stock should be
increased to provide sufficient shares for such corporate purposes as may be
determined by the Board of Directors to be necessary or desirable, which may
include, without limitation, facilitating broader ownership of the Corporation's
Common Stock by effecting a stock split or issuing a stock dividend, raising
capital or acquiring property through the sale of stock, or attracting or
retaining valuable employees by the issuance of stock options. The Corporation
at present has no commitments, agreements or undertakings obligating the
Corporation to issue any such additional shares (other than pursuant to the
Rights Agreement dated as of March 14, 1990); however, the Board of Directors
considers the authorization of additional shares of Common Stock advisable to
ensure prompt availability of shares for issuance should the occasion arise.
 
     Under Massachusetts law, the Board of Directors generally may issue
authorized but unissued shares of Common Stock without shareholder approval. The
Board of Directors does not currently intend to seek shareholder approval prior
to any future issuance of additional shares of Common Stock, unless shareholder
action is required in a specific case by applicable law, the rules of any
exchange or market on which the Corporation's securities may then be listed, or
the articles of organization or by-laws of the Corporation then in effect.
Frequently, opportunities arise that require prompt action, and the Corporation
believes that the delay necessitated for shareholder approval of a specific
issuance could be to the detriment of the Corporation and its shareholders.
 
     The additional shares of Common Stock authorized for issuance pursuant to
the Amendment will have all the rights and privileges which the presently
outstanding shares of Common Stock possess. The increase in authorized shares
would not affect the terms or rights of holders of existing shares of Common
Stock. All outstanding shares would continue to have one vote per share on all
matters to be voted on by the shareholders, including the election of directors.
 
     The authorized but unissued shares of Common Stock could be used to make a
change in control of the Corporation more difficult. For example, such shares
could be sold to purchasers who might side with the Board of Directors in
opposing a takeover bid that the Board determines not to be in the best
interests of the Corporation and its shareholders. Such a sale could have the
effect of discouraging an attempt by another person or entity, through the
acquisition of a substantial number of shares of the Corporation's Common
 
                                       14

<PAGE>   17
 
Stock, to acquire control of the Corporation, since the issuance of new shares
could be used to dilute the stock ownership of such person or entity. The
Corporation is not aware, however, of any pending or threatened efforts to
obtain control of the Corporation.
 
     Approval of the Amendment to increase the number of authorized shares of
Common Stock will require the affirmative vote of at least a majority of all
outstanding shares of the Corporation's Common Stock. THE BOARD OF DIRECTORS
RECOMMENDS A VOTE FOR THE APPROVAL OF THE AMENDMENT.
 
                     RATIFICATION OF SELECTION OF AUDITORS
 
     The Board of Directors has selected the firm of Coopers & Lybrand L.L.P.,
independent certified public accountants, to serve as auditors for the fiscal
year ending December 31, 1995. Coopers & Lybrand L.L.P. has served as the
Corporation's auditors since 1968. It is expected that a member of the firm will
be present at the Annual Meeting of Shareholders with the opportunity to make a
statement if so desired and will be available to respond to appropriate
questions. THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR RATIFICATION OF THIS
SELECTION.
 
                             SHAREHOLDER PROPOSALS
 
     Proposals of shareholders intended for inclusion in the proxy statement to
be furnished to all shareholders entitled to vote at the next annual meeting of
the Corporation must be received at the Corporation's principal executive
offices not later than December 23, 1995. In order to minimize controversy as to
the date on which a proposal was received by the Corporation, it is suggested
that proponents submit their proposals by Certified Mail -- Return Receipt
Requested.
 
                           EXPENSES AND SOLICITATION
 
     The cost of solicitation of proxies will be borne by the Corporation, and
in addition to soliciting shareholders by mail through its regular employees,
the Corporation may request banks and brokers to solicit their customers who
have stock of the Corporation registered in the names of a nominee and, if so,
will reimburse such banks and brokers for their reasonable out-of-pocket costs.
Solicitation by officers and employees of the Corporation may also be made of
some shareholders in person or by mail, telephone or telegraph following the
original solicitation.
 
                                       15

<PAGE>   18


<TABLE>
<S>                                          <C>
                                                          TERADYNE, INC.

                                             PROXY FOR ANNUAL MEETING OF SHAREHOLDERS

                                                           MAY 24, 1995

P                                               SOLICITED BY THE BOARD OF DIRECTORS
R
0       The undersigned hereby appoints ALEXANDER V. D'ARBELOFF and RICHARD J. TESTA, and each or both of them, proxies, with full
X  power of substitution to vote all shares of stock of the Corporation which the undersigned is entitled to vote at the Annual 
Y  Meeting of Shareholders of Teradyne, Inc. to be held on Wednesday, May 24, 1995, at 10:00 A.M., at The First National Bank of 
   Boston, 100 Federal Street (First Floor), Boston, Massachusetts, and at any adjournments thereof, upon matters set forth in the 
   Notice of Annual Meeting of Shareholders and Proxy Statement dated April 20, 1995, a copy of which has been received by the 
   undersigned. The proxies are further authorized to vote, in their discretion, upon such other business as may properly come 
   before the meeting or any adjournments thereof.

</TABLE>



<TABLE>

                                                                                                                 ------------------
                                            CONTINUED AND TO BE SIGNED ON REVERSE SIDE                               SEE REVERSE
                                                                                                                         SIDE
                                                                                                                 -------------------


<S>    <C>                                                          <C>                         <C>            <C>          <C>
       Please mark
/ X /  votes as in
       this example.

THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO
DIRECTION IS GIVEN, WILL BE VOTED FOR THE ELECTION OF CLASS III DIRECTORS AND
FOR THE PROPOSALS IN ITEMS 2 AND 3.

1. To elect three members to the Board of Directors to                                              
serve for a three-year term as Class III Directors.                  2. To amend the Restated         FOR      AGAINST      ABSTAIN
                                                                        Articles of Organization.     / /        / /         / /
 NOMINEES: J.P. Mulroney, O.W. Robbins and
           R.J. Testa                                                3. To ratify the selection of
             FOR               WITHHELD                                 Coopers & Lybrand L.L.P. as
             / /                 / /                                    auditors for the fiscal year  / /       / /         / /
                                                                        ending December 31, 1995.
- ---------------------------------------------------------
*INSTRUCTION:  To withhold your vote for any nominee                      MARK HERE                            MARK HERE
               strike a line through their name                          FOR ADDRESS / /                      IF YOU PLAN  / /
               and check the box above.                                  CHANGE AND                           TO ATTEND
                                                                        NOTE AT LEFT                         THE MEETING


                                                                    (Please sign exactly as your name appears hereon. If signing as
                                                                    attorney, executor, trustee or guardian, please give your full
                                                                    title as such. If stock is held jointly, each owner should sign.
                                                                    Please read reverse side before signing)

                                                                    Signature:__________________________________Date_______________

                                                                    Signature:__________________________________Date_______________

</TABLE>