SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(Mark One)
x | Annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934 |
For the fiscal year end: December 31, 2012
¨ | Transition report pursuant to Section 15(d) of the Securities Exchange Act of 1934 |
For the transition period from to
Commission file number: 000-08135
A. | Full title of the plan and the address of the plan, if different from that of the issuer named below: |
Sigma-Aldrich 401(k) Retirement Savings Plan
B. | Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: |
Sigma-Aldrich Corporation
3050 Spruce Street
St. Louis, MO 63103
SIGMA-ALDRICH
401(k) RETIREMENT SAVINGS PLAN
Table of Contents and Definitions
Page | ||||
Table of Contents: | ||||
Report of Independent Registered Public Accounting Firm | 1 | |||
Statements of Net Assets Available for Benefits, December 31, 2012 and 2011 | 2 | |||
Statements of Changes in Net Assets Available for Benefits, For the Years Ended December 31, 2012 and 2011 | 3 | |||
Notes to Financial Statements, December 31, 2012 and 2011 | 4 | |||
Schedule: | ||||
1 Schedule H, Line 4i-Schedule of Assets (Held at End of Year), December 31, 2012 | 11 |
Definitions:
Company | Sigma-Aldrich Corporation | |||
ERISA | Employee Retirement Income Security Act of 1974 | |||
FASB ASC 820 | Financial Accounting Standards Board Accounting Standards Codification No. 820 Fair Value Measurements | |||
IRC | Internal Revenue Code | |||
IRS | Internal Revenue Service | |||
Managed Income Fund | Fidelity Managed Income Portfolio | |||
NAV | Net Asset Value | |||
Plan | Sigma-Aldrich 401(k) Retirement Savings Plan | |||
Plan Administrator | Sigma-Aldrich Administrative Committee | |||
Trustee | Fidelity Management Trust Company | |||
![](https://capedge.com/proxy/11-K/0000090185-13-000114/a2013auditorsopinion.jpg)
SIGMA-ALDRICH
401(k) RETIREMENT SAVINGS PLAN
Statements of Net Assets Available for Benefits
December 31, 2012 and 2011
2012 | 2011 | |||||||||
Assets: | ||||||||||
Investments, at fair value | $ | 393,498,371 | $ | 324,886,667 | ||||||
Notes receivable from participants | 7,448,667 | 6,980,461 | ||||||||
Total assets | 400,947,038 | 331,867,128 | ||||||||
Net assets available for benefits, at fair value | 400,947,038 | 331,867,128 | ||||||||
Adjustment from fair value to contract value for interest in collective trust relating to fully benefit-responsive investment contract | (111,336 | ) | (80,781 | ) | ||||||
Net assets available for benefits | $ | 400,835,702 | $ | 331,786,347 | ||||||
The accompanying notes are an integral part of these financial statements.
2
SIGMA-ALDRICH
401(k) RETIREMENT SAVINGS PLAN
Statements of Changes in Net Assets Available for Benefits
Years ended December 31, 2012 and 2011
2012 | 2011 | ||||||||
Additions: | |||||||||
Additions to net assets attributed to: | |||||||||
Investment income (loss): | |||||||||
Net appreciation (depreciation) in fair value of investments | $ | 35,664,112 | $ | (15,140,104 | ) | ||||
Dividends | 9,960,395 | 6,746,842 | |||||||
Interest | 6,211 | 5,148 | |||||||
Total investment earnings (loss) | 45,630,718 | (8,388,114 | ) | ||||||
Interest income on notes receivable from participants | 273,799 | 290,300 | |||||||
Miscellaneous receipts | 86,250 | - | |||||||
Contributions: | |||||||||
Employee contributions | 22,261,015 | 19,498,997 | |||||||
Employer contributions | 10,818,017 | 9,188,482 | |||||||
Rollovers | 13,374,944 | 3,524,602 | |||||||
Total contributions | 46,453,976 | 32,212,081 | |||||||
Total additions | 92,444,743 | 24,114,267 | |||||||
Deductions: | |||||||||
Deductions from net assets attributed to: | |||||||||
Benefit payments to participants | $ | (23,345,985 | ) | $ | (18,731,887 | ) | |||
Deemed distributions of participant loans | (5,094 | ) | - | ||||||
Administrative expenses | (44,309 | ) | (46,902 | ) | |||||
Total deductions | (23,395,388 | ) | (18,778,789 | ) | |||||
Increase in net assets available for benefits | 69,049,355 | 5,335,478 | |||||||
Net assets available for benefits, beginning of year | 331,786,347 | 326,450,869 | |||||||
Net assets available for benefits, end of year | $ | 400,835,702 | $ | 331,786,347 | |||||
The accompanying notes are an integral part of these financial statements.
3
SIGMA-ALDRICH
401(k) RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2012 and 2011
(1) | Description of Plan |
The following description of the Plan provides only general information. Participants should refer to the Plan document for a more complete description of the Plan's provisions.
(a) | General |
(b) | Contributions |
New employees shall be deemed to have elected to make a salary deferral of 6% of compensation, generally effective 45 days after date of hire, unless the employee files an election to contribute a different amount than the 6% automatic deferral percentage before this date.
(c) | Participant Accounts |
(d) | Forfeitures |
(e) | Vesting |
Completed years of service | Vested percentage | |||
Less than 3 | 0 | % | ||
3 or more | 100 | % |
(f) | Notes Receivable from Participants |
(Continued)
4
SIGMA-ALDRICH
401(k) RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2012 and 2011
(g) | Payment of Benefits |
Fully vested participants may also withdraw, if approved, certain basic contributions only in the event of a financial hardship as defined by the Plan and the IRC. A participant who receives a distribution for hardship shall be prohibited from making elective deferrals and employee contributions under this and all other plans of the employer for a six month period after receipt of the distribution.
(2) | Summary of Significant Accounting Policies |
(a) | Basis of Accounting |
Investment contracts held by a defined-contribution plan are required to be reported at fair value. However, contract value is the relevant measurement attribute for that portion of the net assets available for benefits of a defined-contribution plan attributable to fully benefit-responsive investment contracts because contract value is the amount participants would receive if they were to initiate permitted transactions under the terms of the Plan. The Statements of Net Assets Available for Benefits present the fair value of the investment contracts as well as the adjustment of the fully benefit-responsive investment contracts from fair value to contract value. The Statements of Changes in Net Assets Available for Benefits are prepared on a contract value basis.
(b) | Accounting Pronouncements |
In May 2011, the FASB issued ASU No. 2011-04, “Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS” (“ASU 2011-04”), which amends Accounting Standards Codification 820, “Fair Value Measurements and Disclosures”. ASU 2011-04 requires categorization by level for items that are required to be disclosed at fair value and information about transfers between Level 1 and Level 2. In addition, ASU 2011-04 provides guidance on measuring the fair value of financial instruments managed within a portfolio and the application of premiums and discounts on fair value measurements. ASU 2011-04 requires additional disclosure for Level 3 measurements regarding the sensitivity of fair value to changes in unobservable inputs and any interrelationships between those inputs. ASU 2011-04 is to be applied prospectively and is effective for the December 31, 2012 plan year. The adoption did not have a material effect on the Statements of Net Assets Available for Benefits and Statements of Changes in Net Assets Available for Benefits.
(c) | Use of Estimates |
(Continued)
5
SIGMA-ALDRICH
401(k) RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2012 and 2011
(d) | Valuation of Investments and Income Recognition |
Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date. The annual revenue credit is recorded quarterly, in arrears, on a pro rata basis. Net appreciation (depreciation) includes the Plan’s gains and losses on investments bought and sold as well as held during the year.
Benefit payments to participants are recorded upon distribution.
(e) | Payment of Benefits |
(f) | Administrative Expenses and Miscellaneous Receipts |
(g) | Subsequent Events |
effective for Plan Years beginning on and after January 1, 2013:
• | Provide a safe harbor contribution of 4.5% of compensation each pay period to each active participant's account in the Plan |
• | Provide a discretionary employer contribution from 0% to 1.5% of compensation to each active participant's account when the Company exceeds its performance plan. Such contribution is not guaranteed and shall be determined in the sole discretion of the Company |
• | Eliminated the Company fixed contributions ($600 for full-time; $300 for part-time) |
• | Limit investments in company stock fund to 25% of new contributions and when rebalancing, no more than 25% of participant balance can be invested in Company stock |
• | Eliminated the 15% cap on contributions for highly compensated employees |
The Plan applied for a new determination letter in January of 2013 stating that the Plan, as amended, is qualified under Section 401(a) of the IRC. A favorable determination letter was received dated April 19, 2013.
(Continued)
6
SIGMA-ALDRICH
401(k) RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2012 and 2011
(3) | Investments |
December 31 | ||||||||||
2012 | 2011 | |||||||||
Fidelity Freedom Fund 2020 – Class K | $ | 25,378,032 | $ | 21,021,203 | ||||||
Fidelity Money Market Trust Retirement Money Market Portfolio | 24,420,365 | 22,375,776 | ||||||||
Fidelity Balanced Fund – Class K | 29,216,733 | 25,979,664 | ||||||||
Fidelity Diversified International Fund – Class K | <5% | 17,160,917 | ||||||||
Sigma-Aldrich Company Stock Fund | 38,188,504 | 36,123,841 | ||||||||
Fidelity Contrafund – Class K | 53,681,747 | 45,813,520 | ||||||||
PIMCO Total Return Inst CL | 34,729,082 | 25,908,089 | ||||||||
Fidelity Freedom Fund 2030 – Class K | 26,978,349 | 20,574,318 | ||||||||
Fidelity Freedom Fund 2025 – Class K | 21,218,404 | <5% |
During 2012 and 2011, the Plan’s investments (including realized and unrealized gains and losses on investments bought and sold, as well as held during the year) appreciated (depreciated) in value by $35,664,112 and $(15,140,104), respectively, as follows:
2012 | 2011 | |||||||||
Mutual funds | $ | 29,208,536 | $ | (13,651,880 | ) | |||||
Sigma-Aldrich Company Stock Fund | 6,455,576 | (1,488,224 | ) | |||||||
$ | 35,664,112 | $ | (15,140,104 |
(Continued)
7
SIGMA-ALDRICH
401(k) RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2012 and 2011
(4) | Fair Value Measurements |
Level 1 Fair Value Measurements
Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the Plan has the ability to access.
Level 2 Fair Value Measurements
Inputs to the valuation methodology include:
• | quoted prices for similar assets or liabilities in active markets; |
• | quoted prices for identical or similar assets or liabilities in inactive markets; |
• | inputs other than quoted prices that are observable for the asset or liability; and |
• | inputs that are derived principally from or corroborated by observable market data by correlation or other means. |
If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.
Level 3 Fair Value Measurements
Inputs to the valuation methodology are unobservable and significant to the fair value measurement.
The asset or liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs.
Following is a description of the valuation methodologies used for assets measured at fair value. There have been no changes in the methodologies used at December 31, 2012 and 2011.
Common stocks: Valued at the closing price reported on the active market on which the individual securities are traded.
Mutual funds: Valued at NAV of shares held by the Plan at year-end.
Common Collective Trust: Valued at NAV as a practical expedient of fair value. The NAV is based on the underlying investments, which are traded on an active market. The Plan does not have any collective investment funds with unfunded commitments or with any redemption restrictions. There is no redemption notice period for the individual participants within the Plan, however, there is up to a twelve- month redemption notice required for this investment at the Plan level. The participants nor the Plan have any funding commitments related to this investment.
The preceding methods used to arrive at a fair value calculation may not be indicative of the net realizable value or reflective of future fair values. Furthermore, while the Plan believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date.
(Continued)
8
SIGMA-ALDRICH
401(k) RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2012 and 2011
The following tables set forth by level, within the fair value hierarchy, the Plan’s assets at fair value as of December 31, 2012 and 2011:
December 31, 2012 | Fair Value Measurements | |||||||||||||||||||
Balance | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
Mutual Funds | ||||||||||||||||||||
Mid Cap | $ | 27,894,843 | $ | 27,894,843 | $ | - | $ | - | ||||||||||||
Large Cap | 74,304,713 | 74,304,713 | - | - | ||||||||||||||||
International | �� | 24,415,599 | 24,415,599 | - | - | |||||||||||||||
Blended | 165,654,745 | 165,654,745 | - | - | ||||||||||||||||
Bond | 34,729,082 | 34,729,082 | - | - | ||||||||||||||||
Money Market | 24,420,365 | 24,420,365 | - | - | ||||||||||||||||
Total Mutual Funds | 351,419,347 | 351,419,347 | - | - | ||||||||||||||||
Common Stock Fund | 38,188,504 | 38,188,504 | - | - | ||||||||||||||||
Common Collective Trust | 3,890,520 | - | 3,890,520 | - | ||||||||||||||||
Total | $ | 393,498,371 | $ | 389,607,851 | $ | 3,890,520 | $ | - | ||||||||||||
December 31, 2011 | Fair Value Measurements | |||||||||||||||||||
Balance | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
Mutual Funds | ||||||||||||||||||||
Mid Cap | $ | 24,082,997 | $ | 24,082,997 | $ | - | $ | - | ||||||||||||
Large Cap | 59,904,330 | 59,904,330 | - | - | ||||||||||||||||
International | 20,611,786 | 20,611,786 | - | - | ||||||||||||||||
Blended | 132,604,554 | 132,604,554 | - | - | ||||||||||||||||
Bond | 25,908,089 | 25,908,089 | - | - | ||||||||||||||||
Money Market | 22,375,776 | 22,375,776 | - | - | ||||||||||||||||
Total Mutual Funds | 285,487,532 | 285,487,532 | - | - | ||||||||||||||||
Common Stock Fund | 36,123,841 | 36,123,841 | - | - | ||||||||||||||||
Common Collective Trust | 3,275,294 | - | 3,275,294 | - | ||||||||||||||||
Total | $ | 324,886,667 | $ | 321,611,373 | $ | 3,275,294 | $ | - | ||||||||||||
(Continued)
9
SIGMA-ALDRICH
401(k) RETIREMENT SAVINGS PLAN
Notes to Financial Statements
December 31, 2012 and 2011
(5) | Investment in Common Collective Trust |
The Managed Income Fund, a common collective trust fund, invests in a variety of investments such as fixed income securities or bond funds and enters into wrapper contracts issued by a third party, such as a bank or insurance company, to make payments to a portfolio in certain circumstances. The wrap issuer agrees to pay an amount sufficient to cover unit holder redemptions.
The interest-crediting rate is the periodic interest rate accrued to participants and is reset on a monthly basis to reflect the performance of the underlying securities.
Participants may ordinarily direct the withdrawal or transfer of all or a portion of their investment in the Managed Income Fund at contract value. Certain events may limit the ability of the Plan to transact at contract value with the issuer. The Plan Administrator does not believe that the occurrence of any such event is probable. The average yield and crediting interest rates were approximately 1.70% and 1.92%, for the Plan years ended December 31, 2012 and 2011, respectively.
(6) | Tax Status |
Accounting principles generally accepted in the United States of America require Plan management to evaluate tax positions taken by the Plan and recognize a tax liability (or asset) if the Plan has taken an uncertain position that more likely than not would not be sustained upon examination by the IRS. The Plan Administrator has analyzed the tax positions taken by the Plan, and has concluded that as of December 31, 2012, there are no uncertain positions taken or expected to be taken that would require recognition of a liability (or asset) or disclosure in the financial statements. The Plan is subject to routine audits by taxing jurisdictions; however, there are currently no audits for any tax periods in progress. The Plan Administrator believes it is no longer subject to income tax examinations for years prior to 2009.
(7) | Related Party |
As of December 31, 2012 and 2011, investments include 494,889 shares and 547,798 shares of Sigma-Aldrich Corporation common stock, respectively, having an aggregate fair value of $36,413,933 and $34,215,463, respectively.
(8) | Risks and Uncertainties |
(9) | Plan Termination |
(Continued)
10
Schedule I
SIGMA-ALDRICH
401(k) RETIREMENT SAVINGS PLAN
Schedule H, Line 4i—Schedule of Assets (Held at End of Year)
December 31, 2012
a) | b) Identity of issue, borrower, lessor or similar party | c) Description | d) | Cost | e) | Curent Value | ||||
Mutual funds: | ||||||||||
* | Fidelity Management Trust Company | Retirement Money Market Portfolio | $ | 24,420,365 | $ | 24,420,365 | ||||
* | Fidelity Management Trust Company | Balanced Fund – Class K | 20,344,365 | 29,216,733 | ||||||
PIMCO Total Return Inst CL | PIMCO Total Return Inst CL | 34,019,886 | 34,729,082 | |||||||
* | Fidelity Management Trust Company | Low-Priced Stock Fund – Class K | 9,514,297 | 11,816,963 | ||||||
* | Fidelity Management Trust Company | Diversified International Fund – Class K | 14,670,059 | 19,390,314 | ||||||
* | Fidelity Management Trust Company | Freedom Income Fund – Class K | 1,256,596 | 1,264,979 | ||||||
* | Fidelity Management Trust Company | Freedom 2000 Fund – Class K | 643,039 | 646,898 | ||||||
* | Fidelity Management Trust Company | Freedom 2005 Fund – Class K | 386,434 | 387,034 | ||||||
* | Fidelity Management Trust Company | Freedom 2010 Fund – Class K | 4,748,476 | 4,757,371 | ||||||
* | Fidelity Management Trust Company | Freedom 2015 Fund – Class K | 10,466,518 | 10,533,561 | ||||||
* | Fidelity Management Trust Company | Freedom 2020 Fund – Class K | 25,246,776 | 25,378,032 | ||||||
* | Fidelity Management Trust Company | Freedom 2025 Fund – Class K | 21,042,213 | 21,218,404 | ||||||
* | Fidelity Management Trust Company | Freedom 2030 Fund – Class K | 26,838,481 | 26,978,349 | ||||||
* | Fidelity Management Trust Company | Freedom 2035 Fund – Class K | 16,541,736 | 16,683,611 | ||||||
* | Fidelity Management Trust Company | Freedom 2040 Fund – Class K | 13,180,995 | 13,297,568 | ||||||
* | Fidelity Management Trust Company | Freedom 2045 Fund – Class K | 7,889,448 | 8,027,429 | ||||||
* | Fidelity Management Trust Company | Freedom 2050 Fund – Class K | 6,820,192 | 6,948,039 | ||||||
* | Fidelity Management Trust Company | Freedom 2055 Fund – Class K | 309,045 | 316,737 | ||||||
* | Fidelity Management Trust Company | Small Cap Stock Fund | 7,599,670 | 8,057,416 | ||||||
* | Fidelity Management Trust Company | Contrafund – Class K | 34,632,820 | 53,681,747 | ||||||
American Fund | American Funds Fundamental Investors Fund Class R5 | 4,121,328 | 4,700,211 | |||||||
American Beacon Fund | American Beacon Lg Cap Value Inst CL | 3,980,947 | 4,266,753 | |||||||
Columbia Acorn | Columbia Acorn International Fund Class Z | 4,630,510 | 5,025,285 | |||||||
Goldman Sachs | Goldman Sachs Mid Cap Value Fund Institutional Class | 4,523,417 | 5,214,468 | |||||||
Munder | Munder Mid-Cap Core Growth Class Y | 2,389,877 | 2,805,996 | |||||||
Spartan | Spartan 500 Index Fund – Institutional Class | 10,174,884 | 11,656,002 | |||||||
310,392,374 | 351,419,347 | |||||||||
Common Stock: | ||||||||||
* | Sigma-Aldrich | Sigma-Aldrich Company Stock Fund | 23,572,431 | 38,188,504 | ||||||
Common Collective Trust: | ||||||||||
* | Fidelity Management Trust Company | Managed Income Portfolio | 3,779,183 | 3,890,520 | ||||||
* | Notes Receivable from Participants | Range of interest rates 3.25% – 8.75%, Maturing through 2022 | 7,448,667 | |||||||
$ | 400,947,038 | |||||||||
* | Represents a party-in-interest. |
See accompanying independent auditors’ report.
11
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, Sigma-Aldrich Corporation, as Plan Administrator of the Sigma-Aldrich 401(k) Retirement Savings Plan, has duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.
SIGMA-ALDRICH | ||
401(k) RETIREMENT SAVINGS PLAN | ||
By: | /s/ Mike Hollenkamp | |
Mike Hollenkamp, Director of Global Treasury | ||
Sigma-Aldrich Corporation | ||
June 21, 2013 |
12
EXHIBIT INDEX
Exhibit | ||
23 | Consent of Independent Registered Public Accounting Firm – Brown Smith Wallace LLC |
13