SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 11-K
(Mark One):
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended December 31, 2004
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 (NO FEE REQUIRED).
For the transition period from _____________ to ________________
Commission file number 1-9389
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below: C&D TECHNOLOGIES SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
C&D TECHNOLOGIES, INC.
1400 UNION MEETING ROAD
BLUE BELL, PA 19422
C&D Technologies
Savings Plan
Financial Statements
December 31, 2004 and 2003 and
Supplemental Schedule
December 31, 2004
C&D Technologies Savings Plan
Index
December 31, 2004 and 2003
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Page(s)
Report of Independent Registered Public Accounting Firm........................1
Financial Statements
Statements of Net Assets Available for Benefits................................2
Statements of Changes in Net Assets Available for Benefits.....................3
Notes to Financial Statements................................................4-8
Supplemental Schedule
Schedule H, Line 4i* - Schedule of Assets (Held at End of Year)................9
* Refers to item numbers in Form 5500 (Annual Return/Report of Employee Benefit
Plan) for the plan year ended December 31, 2004.
Report of Independent Registered Public Accounting Firm
To the Participants and Administrator
of the C&D Technologies Savings Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statements of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the C&D Technologies Savings Plan (the "Plan") at December 31, 2004 and 2003,
and the changes in net assets available for benefits for the years then ended in
conformity with accounting principles generally accepted in the United States of
America. 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 of these statements in
accordance with the standards of the Public Company Accounting Oversight Board
(United States). 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, assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
Our audits were conducted 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 year) 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 is the responsibility of the Plan's management. 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.
/s/ PricewaterhouseCoopers LLP
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Philadelphia, Pennsylvania
June 24, 2005
1
C&D Technologies Savings Plan
Statements of Net Assets Available for Benefits
December 31, 2004 and 2003
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2004 2003
Assets
Investments $41,887,995 $38,347,445
Contributions receivable
Participant -- 85,156
Employer 285,064 928,249
Receivable for investments sold 27,022 2,597
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Total assets 42,200,081 39,363,447
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Liabilities
Payable for investments purchased -- 2,459
Accrued liabilities 18,876 20,317
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Total liabilities 18,876 22,776
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Net assets available for benefits $42,181,205 $39,340,671
========== ==========
The accompanying notes are an integral part of these financial statements.
2
C&D Technologies Savings Plan
Statements of Changes in Net Assets Available for Benefits
Years Ended December 31, 2004 and 2003
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2004 2003
Additions
Net appreciation in fair value of investments $ 1,849,187 $ 5,095,166
Interest income 42,012 38,705
Dividend income 1,121,724 787,641
Employer contributions 1,182,935 1,590,491
Participant contributions 2,516,508 2,413,460
Roll-over contributions 360,735 117,935
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Total additions 7,073,101 10,043,398
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Deductions
Benefits paid to participants 4,176,650 3,422,716
Administrative expenses 55,917 63,913
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Total deductions 4,232,567 3,486,629
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Net increase 2,840,534 6,556,769
Net assets available for benefits
Beginning of year 39,340,671 32,783,902
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End of year $42,181,205 $39,340,671
========== ==========
The accompanying notes are an integral part of these financial statements.
3
C&D Technologies Savings Plan
Notes to Financial Statements
December 31, 2004 and 2003
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1. Description of Plan
General
The following description of the C&D Technologies Savings Plan ("the Plan")
provides only general information. Participants should refer to the
official Plan document for a more complete description of the Plan's
provisions.
The Plan is a defined contribution plan in which certain salaried and
hourly employees of C&D Technologies, Inc. (the "Company") are eligible to
participate with the condition that salaried and hourly employees, whose
terms and conditions of employment are governed by a collective bargaining
agreement, are only eligible to participate if that agreement states that
they are eligible. The Plan is subject to the provisions of the Employee
Retirement Security Act of 1974 ("ERISA").
Employee Contributions
The participants may make pre-tax contributions to the Plan in any whole
percentage of compensation ranging from 1% to 50% subject to limitations of
the plan provisions. Participants may make voluntary after-tax
contributions ranging from 1% to 10% of compensation. Participants who have
attained age 50 before the end of the Plan year are eligible to make
catch-up contributions. Participants may also contribute amounts
representing distributions from other qualified defined benefit or defined
contribution plans. The Plan currently offers 20 mutual funds, 1
common/collective trust and the common stock of the Company as investment
options for participants.
Employer Contributions: Salaried Participants
The Company may elect to make matching contributions to the salaried
participants' Plan accounts for amounts up to 8% of compensation that is
contributed to the Plan by the employee. In 2004 and 2003, the Company
matched 50% of the salaried participants' matchable contribution. This
matching company contribution is invested according to the participant's
allocations. Additionally, the Company may make a discretionary salary
profit sharing contribution not to exceed 8% of the participant's annual
compensation. The Company did not make a profit sharing contribution to
salaried participants for the plan year ended December 31, 2004. For the
Plan year ended December 31, 2003, the Company made a profit sharing
contribution of 3% of the participant's annual compensation for certain
salaried employees. For those salaried participants who have not attained
age 50 as of the end of the Plan year, 50% of this profit sharing
contribution is invested according to the participant's allocation, with
the remaining 50% invested in the common stock of the Company. For those
salaried participants who have attained age 50 as of the end of the Plan
year, 100% of this profit sharing contribution is invested according to the
participant's allocation. All salaried participants who have attained age
50 by the end of the Plan year have the ability to transfer any portion of
their account invested in Company common stock to other investment options.
4
C&D Technologies Savings Plan
Notes to Financial Statements
December 31, 2004 and 2003
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Employer Contributions: Hourly Participants
The Company makes a mandatory hourly profit sharing contribution on behalf
of each eligible hourly employee equal to the appropriate percentage of
his/her compensation which varies based upon his/her years of vesting
service, as illustrated in the following table:
Years of % of
Vesting Service Compensation
0-5 2.5%
6-10 3.0%
11-20 3.5%
21 and greater 4.5%
For those hourly participants who have not attained age 50 by the end of
the Plan year, a portion of this profit sharing contribution equal to 0.5%
of the participant's annual compensation is invested in the Company common
stock, with the remainder of the contribution invested according to the
participant's allocation. For those hourly participants who have attained
age 50 as of the end of the Plan year, 100% of the profit sharing
contribution is invested according to the participant's allocation. All
hourly participants who have attained age 50 by the end of the Plan year
have the ability to transfer any portion of their account invested in
Company common stock to other investment options.
Additional employer contributions may be made for hourly participants based
on the discretion of the Board of Directors. Hourly participants are
eligible to receive these discretionary contributions if they have
completed 1,000 hours of service during the plan year and are employed by
the Company on the last day of the plan year.
Participant Accounts
Each participant's account is credited with the participant's contribution,
the Company's contribution and an allocation of earnings and administrative
expenses. Allocations are based on participant earnings or account
balances, as defined. The benefit to which a participant is entitled is a
benefit that can be provided from participant's vested account.
Vesting
Participants are 100% vested in their own contributions and the earnings
thereon. Vesting in the Company's contributions and earnings thereon is
based on years of continuous service. A salaried participant is 100% vested
after three years of service as defined in the Plan. An hourly participant
is 100% vested after five years of service as defined in the Plan. Any
amount not vested at termination will be forfeited upon the occurrence of
five consecutive 1-year breaks-in-service following a participant's
termination of employment.
Forfeitures
At December 31, 2004 and 2003, forfeited nonvested accounts totaled $49,526
and $31,032, respectively. These accounts are used to reduce Company
payments of future employer contributions and/or Plan expenses. In Plan
year 2004, Plan expenses of $50,134 were funded from forfeitures. In Plan
year 2003, employer contributions of $134,837 and Plan expenses of $37,396
were funded from forfeitures.
5
C&D Technologies Savings Plan
Notes to Financial Statements
December 31, 2004 and 2003
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Payment of Benefits
At the election of the participant, participant benefit payments resulting
from termination of employment, death, disability or retirement are
distributed in a lump sum amount in cash equal to the value of the
participant's vested interest in his or her account. However, participants
who have terminated service with the Company and have vested accounts
valued at less than $5,000 are paid a lump sum distribution which may be
directly paid to the participant or paid as direct rollover payment to an
IRA or another plan.
Participant Loans
Participants may borrow from their vested contribution balances. The loan
is limited to the lesser of 50% of the vested contributions or $50,000. The
minimum loan amount is $1,000. Loans are repaid through regular payroll
deductions. Interest on the loans is charged at rates commensurate with
local prevailing rates.
2. Summary of Significant Accounting Policies
Basis of Accounting
The financial statements of the Plan are prepared on the accrual basis of
accounting.
Investment Valuation and Income Recognition
The Plan's investments are stated at fair value. Quoted market prices are
used to value investments. Shares of mutual funds are valued at the net
asset value of shares held by the Plan at year-end. Common/collective
trusts are valued at unit value. The C&D Technologies Stock Fund is valued
at its year-end unit closing price (comprised of year-end market price plus
uninvested cash position). Participant loans are valued at cost which
approximates fair value.
Purchases and sales are recorded on a trade-date basis. Interest income is
accrued when earned. Dividend income is recorded on the ex-dividend date.
Capital gain distributions are included in dividend income.
The Plan presents in the statement of changes in net assets available for
benefits the net appreciation in the fair value of its investments, which
consists of the realized gains or losses and the unrealized appreciation on
those investments.
Expenses
Certain administrative expenses are paid by the Company.
Use of Estimates
The preparation of the Plan's financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets,
liabilities and changes therein, and disclosures of contingent assets and
liabilities. Actual results could differ from those estimates.
Payment of Benefits
Benefits are recorded when paid.
6
C&D Technologies Savings Plan
Notes to Financial Statements
December 31, 2004 and 2003
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3. Investments
The following presents investments that represent 5% or more of the Plan's
net assets.
2004 2003
Fidelity Managed Income Portfolio, 7,020,465 and 6,664,814
shares, respectively $7,202,465 $6,664,814
Fidelity Magellan Fund, 63,960 and 71,670 shares, respectively 6,638,376 7,005,060
Fidelity Growth & Income Fund, 154,946 and 154,108 shares,
respectively 5,920,501 5,490,882
Fidelity Low-Priced Stock Fund, 110,670 and 94,502 shares 4,454,482 3,305,666
C&D Technologies Stock Fund, 197,140 and 184,237 units
respectively* 3,513,018 * 3,668,525 *
Fidelity Puritan Fund, 122,915 and 108,924 shares, respectively 2,329,241 2,011,833
Fidelity Spartan U.S. Equity Index Fund, 48,565 and
50,191 shares, respectively 2,081,499 1,978,040
*Includes nonparticipant-directed amounts
During 2004 and 2003, the Plan's investments appreciated (depreciated) in
value as follows:
2004 2003
Mutual Funds $2,180,356 $4,685,499
Common stock (331,169) 409,667
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$1,849,187 $5,095,166
========= =========
4. Nonparticipant-Directed Investments
Information about the net assets and the significant components of the
changes in net assets relating to the nonparticipant-directed investments
is as follows:
2004 2003
Net assets
Company common stock $510,785 $591,961
======= =======
2004 2003
Changes in net assets
Employer contributions $ -- $191,756
Net appreciation (depreciation) in fair value (35,636) 72,623
Dividend income 4,132 2,648
Interest income 6,006 --
Benefits paid to participants (55,678) (18,554)
Administrative expenses -- (978)
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Net increase (decrease) $(81,176) $247,495
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7
C&D Technologies Savings Plan
Notes to Financial Statements
December 31, 2004 and 2003
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5. Plan Termination
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of ERISA. In the event of Plan
termination, participants will become 100% vested in their accounts.
6. Plan Tax Status
The Plan has received a favorable determination letter dated May 22, 2002
from the Internal Revenue Service ("IRS") advising that the Plan
constitutes a qualified trust under Section 401(a) of the Internal Revenue
Code ("IRC"), and is therefore exempt from federal income taxes under
provisions of Section 501(a). Although the Plan has been amended since
receiving the determination letter, the Plan Administrator and Plan's tax
counsel believe that the Plan is designed and is currently being operated
in compliance with the applicable requirements of the IRC.
7. Related Party Transactions
Certain Plan investments are shares of mutual funds managed by Fidelity
Management Trust Co. ("Fidelity"). Fidelity is the trustee as defined by
the Plan and, therefore, these transactions qualify as party-in-interest
transactions. Fees paid to Fidelity for the recordkeeping and trustee
services amounted to $55,917 for the year ended December 31, 2004.
The Plan is interpreted, administered and operated by a committee which in
Plan year 2004 was comprised of the Company's Vice President, Finance &
Chief Financial Officer, Vice President of Human Resources, Vice President
& Treasurer, Director of Labor and Employment, and Deputy General Counsel.
During the years ended December 31, 2004 and 2003, the Company paid
administrative expenses of $19,851 and $24,667, respectively, on behalf of
the Plan.
During 2004 and 2003, the Plan had purchases of C&D Technologies, Inc.
common stock in the amount of $990,137 and $2,752,665, respectively, and
sales of C&D Technologies, Inc. common stock in the amount of $835,676 and
$2,072,558, respectively.
8. Risks and Uncertainties
The Plan provides for various investment options in any combination of
stocks, bonds, fixed income securities, mutual funds, and other investment
securities. Investment securities are exposed to various risks, such as
interest rate, market and credit risks. Due to the level of risk associated
with certain investment securities, it is at least reasonably possible that
changes in the values of investment securities will occur in the near term
and that such changes could materially affect participants' account
balances and the amounts reported in the statement of net assets available
for benefits.
The Company allows participants to invest in the company's stock and
requires that a portion of the company profit sharing contribution be
invested in company stock for those participants that have not attained age
50. The quoted market price of the Company's stock has declined from $17.04
per share on December 31, 2004 to $8.68 on June 24, 2004, the date of this
report.
8
Supplemental Schedule
C&D Technologies Savings Plan
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
December 31, 2004
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Description of Investment % of
Identity of Issue Rate of Interest Cost Fair Value Total
*Fidelity Managed Income Portfolio Registered Investment Company $ 7,020,465 16.8%
*Fidelity Magellan Fund Registered Investment Company 6,638,376 15.8%
*Fidelity Growth & Income Fund Registered Investment Company 5,920,501 14.1%
*Fidelity Low-Priced Stock Fund Registered Investment Company 4,454,482 10.6%
*Fidelity Puritan Fund Registered Investment Company 2,329,241 5.6%
*Fidelity Spartan U.S. Equity Index Fund Registered Investment Company 2,081,499 5.0%
*Fidelity Diversified International Fund Registered Investment Company 2,056,900 4.9%
*Fidelity Freedom 2020 Fund Registered Investment Company 1,259,537 3.0%
*Fidelity Freedom 2010 Fund Registered Investment Company 1,110,057 2.7%
*Fidelity Freedom 2030 Fund Registered Investment Company 764,825 1.8%
*Fidelity Government Income Fund Registered Investment Company 601,724 1.4%
*Fidelity Freedom 2000 Fund Registered Investment Company 309,040 0.7%
*Fidelity Mid Cap Stock Fund Registered Investment Company 283,855 0.7%
*Fidelity Freedom Income Fund Registered Investment Company 257,718 0.6%
*Fidelity Blue Chip Fund Registered Investment Company 152,194 0.4%
*Fidelity Freedom 2040 Fund Registered Investment Company 25,265 0.1%
*C&D Technologies, Inc. Common Stock Common Stock $3,671,502 3,513,018 8.4%
Morgan Stanley Institutional Fund Trust
Fixed Income Portfolio Registered Investment Company 1,504,741 3.6%
Janus Midcap Value Fund Registered Investment Company 470,264 1.1%
Oakmark Fund Class I Registered Investment Company 330,334 0.8%
Morgan Stanley Institutional
Small Company Growth B Fund Registered Investment Company 232,566 0.6%
Munder Small Cap Value A Fund Registered Investment Company 91,855 0.2%
Participant Loans Interest, 6-11.5%, maturity
of 1-6 years 479,538 1.1%
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Total investments $41,887,995
==========
*Party-in-interest
9
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934,
the C&D Technologies Pension Administration Committee has duly caused this
annual report to be signed on its behalf by the undersigned hereunto duly
authorized.
C&D Technologies Savings Plan
Date: June 27, 2005 By: /s/ Stephen E. Markert, Jr.
-----------------------------------
Stephen E. Markert, Jr.
Vice President, Finance & Chief
Financial Officer
(C&D Technologies Pension
Administration Committee, Plan
Administrator)
EXHIBIT INDEX
23. Consent of Independent Registered Public Accounting Firm