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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One):
[ ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the fiscal year ended __________________
OR
[X] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from April 1, 2001 to December 31, 2001
Commission File Number: 001-13889
A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
MacDermid Equipment, Inc. 401K Plan
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
MacDermid, Incorporated
245 Freight Street
Waterbury, CT 06702-0671
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REQUIRED INFORMATION
In accordance with the rules to Form 11-K, attached as Appendix 1 to
this Form 11-K are the plan financial statements and schedules prepared in
accordance with the financial reporting requirements of ERISA and examined by an
independent accountant on a full scope basis.
EXHIBITS
23.1 Consent of KPMG LLP
SIGNATURES
THE PLAN. Pursuant to the requirements of the Securities Exchange Act
of 1934, the trustees (or other persons who administer the employee benefit
plan) have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
MACDERMID EQUIPMENT, INC. 401K PLAN
Date: June 26, 2002 By: /s/ FRANK MONTIERO
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Frank Montiero
Member, MacDermid Benefit Plans
Administration Committee
APPENDIX 1
MACDERMID EQUIPMENT, INC. 401K PLAN
Financial Statements and Supplemental Schedule
December 31 and March 31, 2001
(With Independent Auditors' Report Thereon)
MACDERMID EQUIPMENT 401K PLAN
TABLE OF CONTENTS
PAGE
Independent Auditors' Report 1
Statements of Net Assets Available for Plan Benefits 2
Statements of Changes in Net Assets Available for Plan Benefits 3
Notes to Financial Statements 4
SCHEDULE
Schedule H, Line 4i - Schedule of Assets (Held at End of Period) 9
Note: Schedules of reportable transactions, nonexempt transactions, loans or
fixed income obligations in default or classified as uncollectible,
leases in default or classified as uncollectible and investment assets
both acquired and disposed of within the plan year as required by the
Employee Retirement Income Security Act of 1974 (ERISA) and Department
of Labor Regulations have not been included herein as the information
is not applicable.
INDEPENDENT AUDITORS' REPORT
Plan Administration Committee
MacDermid Equipment, Inc. 401K Plan:
We have audited the accompanying statements of net assets available for plan
benefits of MacDermid Equipment, Inc. 401K Plan as of December 31 and March 31,
2001 and the related statements of changes in net assets available for plan
benefits for the nine months ended December 31, 2001 and the year ended March
31, 2001. These financial statements are the responsibility of the Plan's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits of MacDermid
Equipment, Inc. 401K Plan as of December 31 and March 31, 2001 and the changes
in net assets available for plan benefits for the nine months ended December 31,
2001 and year ended March 31, 2001 in conformity with accounting principles
generally accepted in the United States of America.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets held
at end of period is presented for the purpose of additional analysis and is not
a required part of the basic financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The supplemental schedule has been subjected to the auditing procedures
applied in the audits of the basic financial statements and, in our opinion, is
fairly stated in all material respects in relation to the basic financial
statements taken as a whole.
As discussed in Note 9 to the accompanying financial statements, the Company
announced the termination of the Plan effective March 31, 2002. In connection
with the anticipated termination of the Plan, the Plan's assets will be
distributed to participants.
/s/ KPMG LLP
Hartford, Connecticut
May 10, 2002
MACDERMID EQUIPMENT, INC. 401K PLAN
Statements of Net Assets Available for Plan Benefits
December 31 and March 31, 2001
DECEMBER 31, MARCH 31,
ASSETS 2001 2001
----------------- ---------------
Assets:
Investments, at fair value (note 5):
MacDermid Company Stock Fund $ 283,305 287,924
Other investments 1,035,947 1,177,581
----------------- ---------------
Total investments 1,319,252 1,465,505
Cash (6,168) 25,574
----------------- ---------------
Total assets 1,313,084 1,491,079
----------------- ---------------
Liabilities:
Due to trustee (note 8) (10,944) (10,944)
----------------- ---------------
Total liabilities (10,944) (10,944)
----------------- ---------------
Net assets available for plan benefits $ 1,302,140 1,480,135
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See accompanying notes to financial statements.
2
MACDERMID EQUIPMENT, INC. 401K PLAN
Statements of Changes in Net Assets Available for Plan Benefits
Nine months ended December 31, 2001 and Year ended March 31, 2001
DECEMBER 31, MARCH 31,
2001 2001
-------------- ------------
Investment income:
Dividend and interest income on securities $ 8,291 86,230
Interest on participant loans 4,151 7,227
Net depreciation in fair value of investments (note 6) (55,334) (315,058)
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Total investment loss (42,892) (221,601)
Contributions:
Employer 40,965 95,258
Employee 83,714 175,799
Rollover -- 918
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Total additions 81,787 50,374
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Distributions to participants (253,069) (203,707)
Administrative expenses (1,611) --
Other, net (5,102) (12,214)
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Total deductions (259,782) (215,921)
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Net decrease (177,995) (165,547)
Net assets available for plan benefits, beginning of year 1,480,135 1,645,682
-------------- ------------
Net assets available for plan benefits, end of year $ 1,302,140 1,480,135
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See accompanying notes to financial statements.
3
MACDERMID EQUIPMENT, INC. 401K PLAN
Notes to Financial Statements
December 31 and March 31, 2001
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) BASIS OF PRESENTATION
The MacDermid Equipment, Inc. (the Company) 401K Plan (the Plan)
is a defined contribution plan that was established as of January
1, 1989 under the name of the Hollmuller America, Inc. 401(k)
Plan. MacDermid, Inc. had owned 50% of Hollmuller America, Inc.
During 1995, MacDermid, Inc. purchased the remaining 50% of
Hollmuller America, Inc., and the name of the Plan was changed to
the MacDermid Equipment, Inc. 401K Plan.
The accompanying financial statements have been prepared on an
accrual basis. Current values of investments are determined using
quoted market prices and current yields. Purchases and sales of
securities are recorded on a trade-date basis. The cost of
investments sold is determined on an average cost basis.
(b) TRUST FUND
Prudential Investments was the Trustee of the Plan through
December 31, 2000. Effective January 1, 2001, First Union National
Bank is the Trustee of the Plan. The assets of the Plan were
transferred in January 2001. Under the terms of a trust agreement
between the Trustee and the Plan, the Trustee manages a trust fund
on behalf of the Plan. The Plan Trustee has discretionary
authority concerning purchases and sales of investments in the
trust fund. The investments and changes therein of this trust fund
have been reported to the Plan by the Trustee as having been
determined through the use of current values for all assets and
liabilities.
(c) USE OF ESTIMATES
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of
America requires management of the Plan to make estimates and
assumptions that affect the reported amounts of assets,
liabilities, and the disclosure of contingent assets and
liabilities. Actual results could differ from those estimates.
(d) PAYMENT OF BENEFITS
Benefits are recorded when paid.
(e) GENERAL
Effective December 31, 2001, the plan year changed from a March 31
fiscal year end to a December 31 calendar year end.
(2) PLAN PROVISIONS
Under the terms of the Plan, an employee is eligible to become a
participant in the Plan (for the purpose of making employee
contributions) upon the completion of 30 days of employment and reaching
the age of 18. For the purpose of receiving Company contributions, an
employee is eligible after completing at least 1,000 hours of employment
with the Company during the current Plan year and if they are a
participant on the last day of the Plan year.
4
An employee may make voluntary pre-tax contributions to the Plan totaling
from 1% to 15% of the employee's gross pay, subject to IRS limitations.
Contributions toward Company stock (up to 6%) are matched by the Company
$0.50 per dollar, to a maximum of 3% of employees' gross pay. Each
participant shall direct (to funds) 100% of their contributions.
The Company may make profit-sharing contributions to the Plan. This is a
discretionary contribution determined by the Board of Directors.
Profit-sharing contributions were $0 and $42,822 for the nine months
ended December 31, 2001 and the year ended March 31, 2001, respectively.
Employees vest immediately in their contributions. Full vesting with
respect to the Company's contribution requires five years of credited
service, except that full vesting will apply when an employee attains age
55, dies or becomes totally disabled. Any forfeited amounts related to
the maximum additional 3% of compensation allocated to the MacDermid
Company Stock Fund shall be applied to reduce contributions by the
Company for the Plan year or allocated to Plan participants who are
participants on the last day of the Plan year in the proportion that each
participant's compensation bears to the total compensation of all such
participants. Forfeitures available to reduce future employer
contributions amounted to $66,468 and $58,344 at December 31 and March
31, 2001, respectively.
Distribution of participants' accounts upon separation shall be paid in
(a) a lump sum, or (b) equal installments.
(3) FEDERAL INCOME TAXES
The Plan has received a tax determination letter from the Internal
Revenue Service (IRS) indicating that the Plan qualifies under the
provisions of Section 401(a) of the Internal Revenue Code (IRC) and is
exempt from federal income taxes. The Plan has been amended since
receiving the determination letter, however, the Company believes the
Plan is designed and is currently being operated in compliance with the
applicable sections of the IRC.
Plan participants are taxed on Plan benefits at the time of distribution
to the extent such distribution exceeds a participant's post-tax
contribution to the Plan. The Plan withholds the mandatory 20% federal
tax from all taxable distributions, which are not direct rollovers. The
tax consequences to the participant will depend on the type of
distribution (lump sum, annuity, or installments).
(4) INVESTMENT PROGRAMS
Plan participants may elect from among 13 separate investment funds in
which to have their contributions and a portion of the Company's
contribution invested. The 13 investment funds of the Plan as of December
31, 2001 are as follows:
(1) FIRST UNION STABLE INVESTMENT FUND - Seeks maximum current income
consistent with stability of capital and maintenance of liquidity.
(2) DAVIS NY VENTURE FUND A - Seeks long-term capital appreciate and
income through purchasing high-quality, well managed, growing
companies at value prices and holding them for the long term.
5
(3) EVERGREEN SPECIAL EQUITY FUND I - Seeks growth of capital through
investing mainly in both growth and value-oriented stocks that show
potential for growth in earnings and price.
(4) FEDERATED STOCK TRUST FUND - Seeks growth of income and capital by
investing principally in a professionally managed and diversified
portfolio of common stock of high quality companies.
(5) INVESCO DYNAMICS FUND - Seeks capital appreciation.
(6) JANUS GROWTH & INCOME FUND - Seeks long-term growth of capital
with a limited emphasis on income.
(7) JANUS WORLDWIDE FUND - Seeks long-term growth of capital by
investing in a diversified portfolio of common stocks of foreign
and domestic issuers of all sizes.
(8) MFS CAPITAL OPPORTUNITIES FUND A - Seeks capital appreciation by
investing primarily in common stocks.
(9) DREYFUS S&P MID-CAP INDEX FUND - Seeks to provide investment
results that correspond to the price and yield performance of
publicly-traded common stocks of medium-size domestic companies in
the aggregate, as represented by the Standard & Poor's MidCap 400
Index.
(10) EVERGREEN SELECT CORE BOND FUND - Seeks to maximize total return
through a combination of current income and capital growth by
investing mainly in corporate and mortgage securities.
(11) FIDELITY MORTGAGE SECURITIES FUND - Seeks high current income
consistent with prudent investment risk. The fund may also consider
the potential for capital gain.
(12) AIM FUNDS GROUP BALANCED A - Seeks to provide income and long-term
growth of capital and income by investing in companies of all
sizes, both domestic and foreign, and investment-grade bonds.
(13) MACDERMID INCORPORATED COMPANY STOCK FUND - This fund consists
primarily of common stock of MacDermid, Inc.
Participants may elect to transfer amounts from one investment fund to
another using a voice response system or via the internet. Once an
election is made to allocate funds to the MacDermid Company Stock Fund,
the funds may not be transferred out, except that participants over the
age of 55 may transfer certain funds out of the MacDermid Company Stock
Fund.
(5) INVESTMENTS
In September 1999, The American Institute of Certified Public Accountants
issued Statement of Position 99-3, ACCOUNTING FOR AND REPORTING OF
CERTAIN DEFINED CONTRIBUTION PLAN INVESTMENTS AND OTHER DISCLOSURE
MATTERS (SOP 99-3). SOP 99-3 simplifies the disclosure for certain
investments and is effective for plan years ended after December 15,
1999. The Plan adopted SOP 99-3 during the Plan year ended March 31,
2000.
6
The following table represents the fair value of investments. Investments
that represent 5% or more the Plan's net assets are separately
identified:
DECEMBER 31, MARCH 31,
2001 2001
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First Union Stable Investment Fund $ 126,498 135,155
Davis NY Venture Fund A 279,315 255,052
Janus Growth & Income Fund 136,863 174,598
AIM Funds Group Balanced A 180,105 296,048
Evergreen Select Core Bond Fund 75,390 --
MacDermid Company Stock Fund 283,305 287,924
Other investments 237,776 316,728
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$ 1,319,252 1,465,505
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(6) DEPRECIATION IN FAIR VALUE OF ASSETS HELD
During the nine months ended December 31, 2001 and the year ended March
31, 2001, the Plan's investments (including investments bought and sold,
as well as investments held during the year) depreciated as follows:
NET DEPRECIATION IN FAIR VALUE
------------------------------------------
DECEMBER 31, MARCH 31,
2001 2001
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Common stocks $ (28,414) (208,536)
Mutual funds (26,920) (106,522)
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$ (55,334) (315,058)
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(7) PARTICIPANT NOTES RECEIVABLE
Participants may borrow from their fund accounts a minimum of $1,000 up
to a maximum equal to the lesser of $50,000 or 50% of their vested
account balance. Loan transactions are treated as a transfer to (from)
the investment fund from (to) the Loan Fund. Loan terms range from 1-5
years or up to 10 years for the purchase of a primary residence. Loans
are secured by the balance in a participant's account and bear interest
at a rate equal to the prime rate. Principal and interest is paid ratably
through regular payroll deductions.
7
(8) RELATED PARTY TRANSACTIONS
Certain Plan investments are shares of mutual funds managed by Prudential
prior to January 1, 2001 and subsequently by First Union from January 1,
2001 forward. First Union and Prudential are the Trustees as defined by
the Plan and, therefore, these transactions qualify as party-in-interest
transactions.
(9) SUBSEQUENT EVENT
Effective March 31, 2002, the Company announced the termination of the
Plan. In connection with the anticipated termination of the Plan, the
Plan's assets will be distributed to participants (or to their
beneficiaries). Distributions may be made by the Plan, in whole or in
part, in the form of eligible rollover distributions to the MacDermid,
Incorporated Profit Sharing and Employee Stock Ownership Plan or an IRA.
The forfeitable portion of eligible, active participants' account
balances will be fully vested on the date the Plan is terminated.
8
Schedule H, Line 4i
MACDERMID EQUIPMENT, INC. 401K PLAN
Schedule of Assets (Held at End of Period)
December 31, 2001
IDENTITY OF ISSUER, BORROWER, DESCRIPTION OF CURRENT
LESSOR, OR SIMILAR PARTY INVESTMENT VALUE
-------------------------------------------------------- ---------------- ----------------
* First Union Stable Investment Fund 4,518 units $ 126,498
* MacDermid Company Stock Fund 16,714 shares 283,305
American Century Ultra Fund 127 units 3,475
Davis NY Venture Fund A 10,984 units 279,315
Evergreen Special Equity Fund I 1,805 units 20,320
Federated Stock Trust Fund 427 units 14,497
Franklin Templeton Small Cap Growth Fund A 52 units 1,607
Invesco Dynamics Fund 52 units 822
Janus Growth & Income Fund 6,615 units 136,863
Janus Worldwide Fund 1,348 units 39,515
MFS Capital Opportunities Fund A 2,596 units 34,869
Dreyfus S&P Mid-Cap Index Fund 597 units 12,575
Evergreen Select Core Bond Fund 6,630 units 75,390
Fidelity Mortgage Securities Fund 5,065 units 54,149
AIM Funds Group Balanced A 6,943 units 180,105
* Participant Loans 5.75% - 9.0% 55,947
----------------
Total $1,319,252
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*Represents a party-in-interest.
9