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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 11-K
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For The Fiscal Year Ended December 31, 2003
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period _____ to _____
COMMISSION FILE NUMBER
0-27222
CFC INTERNATIONAL, INC.
EMPLOYEES' SAVINGS AND INVESTMENT PLAN
CFC INTERNATIONAL, INC.
500 State Street
Chicago Heights, IL 60411
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REQUIRED INFORMATION
Page
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(a) Financial Statements - Plan financial statements and 3-12
schedule prepared in accordance with financial
reporting requirements of ERISA.
See accompanying Contents of Financial Statements
and Supplemental Schedule attached hereto, which
is incorporated herein by reference.
(b) Signatures 13
(c) Exhibits 14
23 Consent of Independent Registered Public
Accounting Firm
CFC International, Inc.
Employees' Savings and
Investment Plan
Financial Statements and Supplemental Schedule
December 31, 2003 and 2002
CFC International, Inc.
Employees' Savings and Investment Plan
Index
December 31, 2003 and 2002
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Page(s)
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Report of Independent Registered Public Accounting Firm........ 1
Financial Statements
Statements of Net Assets Available for Benefits................ 2
Statement of Changes in Net Assets Available for Benefits...... 3
Notes to Financial Statements.................................. 4-7
Supplemental Schedule
Schedule I: Schedule H, line 4i - Schedule of Assets
(Held at End of Year).......................................... 8
Note: Other schedules required by 29 CFR 2520.103-10 of the Department of
Labor's Rules and Regulations for Reporting and Disclosure under ERISA
have been omitted because they are not applicable.
Report of Independent Registered Public Accounting Firm
To the Participants and Administrator of the
CFC International, Inc. Employees' Savings
and Investment Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the CFC International, Inc. Employees' Savings and Investment Plan (the
"Plan") at December 31, 2003 and 2002, and the changes in net assets available
for benefits for the year ended December 31, 2003 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. This
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.
Chicago, Illinois
May 5, 2004
CFC International, Inc.
Employees' Savings and Investment Plan
Statements of Net Assets Available for Benefits
December 31, 2003 and 2002
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2003 2002
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Assets
Investments
Participant directed investments, at fair value . $8,185,490 $6,595,046
Loans to participants ........................... 75,993 133,097
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Total investments ................... 8,261,483 6,728,143
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Receivables
Employer contributions .......................... 12,685 12,231
Employee contributions .......................... 41,378 41,225
Interest ........................................ 7 202
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Total receivables ................... 54,070 53,658
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Net assets available for benefits .................... $8,315,553 $6,781,801
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The accompanying notes are an integral part of these financial
statements.
CFC International, Inc.
Employees' Savings and Investment Plan
Statement of Changes in Net Assets Available for Benefits
Year Ended December 31, 2003
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Additions
Investment income
Net appreciation in fair value of investments ............. $1,221,750
Dividend income ........................................... 68,364
Interest income ........................................... 7,937
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1,298,051
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Contributions
Employer .................................................. 177,014
Employee .................................................. 600,118
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777,132
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Total additions ............................... 2,075,183
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Deductions
Benefits paid to participants .................................. 539,941
Loan and distribution fees ..................................... 1,490
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Total deductions ................................. 541,431
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Net increase ..................................... 1,533,752
Net assets available for benefits, beginning of year ........... 6,781,801
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Net assets available for benefits, end of year ................. $8,315,553
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The accompanying notes are an integral part of these financial
statements.
CFC International, Inc.
Employees' Savings and Investment Plan
Notes to Financial Statements
December 31, 2003 and 2002
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1. Plan Description
The following description of the CFC International, Inc. Employees'
Savings and Investment Plan (the "Plan") is provided for general
information purposes only. Interested parties should refer to the summary
plan description or plan agreement for more complete details of the
Plan's provisions. The Plan is a defined contribution plan whose purpose
is to provide retirement benefits for eligible employees of CFC
International, Inc. (the "Employer") who have completed one hour of
service and attained age 21. Eligible employees must complete one hour of
service. The Plan is subject to the provisions of the Employee Retirement
Income Security Act of 1974 ("ERISA").
ABN AMRO Trust Services Company is the Trustee of the Plan. The Trustee
holds the Plan's investment assets and executes investment transactions.
Contributions
Eligible employees ("Participants") may contribute between 2% and 18% of
their annual compensation under a salary deferral agreement, subject to
limits imposed by the Internal Revenue Code. Participants may contribute
18% of their annual pre-tax compensation and 14% of their annual post-tax
compensation. For each participant's salary deferral contribution up to a
maximum of 4% of annual compensation, as defined, the Employer will make
matching contributions of 50% of such participant's pre-tax contribution.
In addition, the Employer can make a discretionary contribution to the
Plan each year.
Participant Accounts, Vesting and Forfeitures
Participant accounts are credited with each participant's current
contribution, Employer matching contributions and a share of the Plan's
earnings and losses. The Employer's matching contributions are credited
monthly. The allocation of Plan earnings and losses are based on the
proportion that the balance of each participant's account invested in an
investment fund bears to the total balance of all participants' accounts
invested in that investment fund. Participants immediately vest in their
own contributions plus earnings and losses thereon. The Employer's
matching contributions vest after one year of service. Employees must
complete 1,000 hours (one year) of service and be employed on the last
day of the plan year to receive an Employer discretionary contribution.
Employer discretionary contributions vest over seven years, as defined in
the plan document. Forfeitures of non-vested balances are used to reduce
the Employer's contribution for the Plan year. Forfeitures were $290 and
$22,409 in 2003 and 2002, respectively.
Payment of Benefits
On termination of service due to retirement, death or disability,
participants become 100% vested in their account balance. For termination
of service for other reasons, participants may receive the vested balance
in their account. Vested balances less than $5,000 are automatically
distributed after employment is terminated. Vested balances greater than
$5,000 are distributed upon election by the participant. All amounts must
be distributed as lump-sum distributions.
CFC International, Inc.
Employees' Savings and Investment Plan
Notes to Financial Statements
December 31, 2003 and 2002
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Participant Loans
The Plan provides that a participant may borrow a minimum of $1,000 and
up to a maximum of the lessor of 50% of the participant's vested account
balance or $50,000 less the excess of the highest outstanding loan
balance during the previous one year period over the outstanding balance
as of the date of the loan. The loans are secured by the balance in the
participant's account and bear interest at the prime rate at the time of
the loan plus 1%. Repayment occurs through payroll withholding over a
period not to exceed 60 months, unless the loan is for the purchase or
construction of a home, in which case the repayment period may extend to
180 months.
Expenses
All recordkeeping expenses incurred by the Plan were paid by the Employer
in 2003 and 2002. All loan processing and distribution fees are paid by
the participants requesting the transactions.
2. Summary of Significant Accounting Policies
Basis of Accounting
The Plan's financial statements are prepared on the accrual basis of
accounting.
Investment Valuation and Investment Income
Under provisions of the plan, participants may direct the Trustee to
invest their contributions, as well as employer contributions, in any of
the investment options available under the Plan. Investment options are
mutual funds, a money market fund and certain equity securities, valued
at fair value as determined by the Trustee, using quoted market prices
when available. Loans to participants are carried at the outstanding
principal amount which is estimated to approximate fair value.
Purchases and sales of securities, including related gains and losses,
are recorded on a trade-date basis. Dividends are recorded when declared
and allocated monthly. Interest is accrued and allocated monthly.
The Plan presents in the statement of changes in net assets available for
benefits the net appreciation (depreciation) in the fair value of its
investments which consists of the realized gains or losses and the
unrealized appreciation (depreciation) on those investments.
Payment of Benefits Benefits are recorded when paid.
Contributions
Employer matching and employee contributions are recognized during the
period in which the participant's related compensation is earned.
Employer discretionary contributions are recognized during the period in
which approved by the Employer's board of directors. No Employer
discretionary contributions were made during the years ended December 31,
2003 and 2002.
CFC International, Inc.
Employees' Savings and Investment Plan
Notes to Financial Statements
December 31, 2003 and 2002
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Risks and Uncertainties
The Plan provides for investment in various mutual funds, a money market
fund and certain equity securities. Such investments are exposed to
various risks, such as interest rate, market and credit. The Plan also
has an international fund exposed to currency risks. Due to the level of
risk associated with such investments, 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 amount reported in the statements of net assets
available for benefits and the statement of changes in net assets
available for benefits.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities
and changes therein, and disclosure of contingent assets and liabilities.
Actual results could differ from those estimates.
3. Investments
The following table presents individual participant directed investment
options that represent 5% or more of the Plan's net assets as of December
31:
2003 2002
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ABN AMRO S&P 500 Index Collective Fund $3,996,330 $2,940,882
ABN AMRO Chicago Capital Bond Fund 1,318,677 1,435,471
ABN AMRO Income Plus Collective Fund 1,529,690 1,387,481
Veredus Aggressive Growth Fund 431,484 -
During 2003, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year) appreciated
in value by $1,221,750 as follows:
2003
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Mutual funds $ 255,747
Common stock 30,837
Collective trusts 935,166
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$1,221,750
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4. Party-in-Interest Transactions
Party-in-interest transactions consisted of loans made to participants
and all investments since all investments other than loans to
participants are held by the Trustee.
CFC International, Inc.
Employees' Savings and Investment Plan
Notes to Financial Statements
December 31, 2003 and 2002
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5. Tax Status
The Plan is a Prototype Non-standardized Profit Sharing Plan ("Prototype
Plan") sponsored by Chicago Trust Company, a related company to the
Trustee, and adopted by the Company. The Prototype Plan obtained its
latest determination letter on August 30, 2001, in which the Internal
Revenue Service ("IRS") stated that the Prototype Plan, as then designed,
was in compliance with the applicable requirements of the Internal
Revenue Code ("IRC"). The Plan has not requested its own determination
letter from the IRS. Although the Plan has been amended since receiving
the determination letter, the plan administrator believes that the Plan
is currently designed and being operated in compliance with the
applicable requirements of the IRC. Therefore, the plan administrator
believes that the Plan was qualified and the related trust was tax-exempt
as of the financial statement dates.
6. Termination of Plan
The Employer believes the Plan will continue without interruption,
however, it has the right to amend or terminate the Plan at any time
(subject to the provisions of ERISA). Should the Plan be terminated,
participant account balances become 100% vested and Plan assets, after
allowances for expenses of administration or liquidation, are to be
allocated proportionately to each participant based on the net aggregate
value of the participants' investments determined as of the date of Plan
discontinuance.
SUPPLEMENTAL SCHEDULE
CFC International, Inc.
Employees' Savings and Investment Plan
Schedule H, line 4i - Schedule of Assets (Held at End of Year)
December 31, 2003 Schedule I
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(c)
(b) Description of
Identity of Issue, Investment Including
Borrower Maturity Date, Rate of ** (e)
Lessor, or Interest, Collateral, (d) Current
(a) Similar Party Par or Maturity Value Cost Value
* ABN AMRO Treasury ABN AMRO S&P 500 Index
Collective Fund - $3,996,330
* ABN AMRO Treasury ABN AMRO Chicago Capital
Bond Fund - 1,318,677
* ABN AMRO Treasury ABN AMRO Income Plus
Collective Fund - 1,529,690
* ABN AMRO Treasury Veredus Aggressive
Growth Fund - 431,484
* ABN AMRO Treasury ABN AMRO Chicago Capital
Growth Fund - 200,724
* ABN AMRO Treasury Artisan Mid-Cap Growth Fund - 109,502
* ABN AMRO Treasury ABN AMRO Money Market
Liquidity Fund - 112
* ABN AMRO Treasury Julius Baer International
Equity Fund - 365,277
* CFC International, Inc. CFC International Unitized
Stock Fund - 233,694
* Participant loans 5.0% to 10.5% interest per
annum with maturity dates
between February 2004 and
March 2016 - 75,993
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Total assets $8,261,483
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* Indicates a party-in-interest
**Cost information has been omitted as investments are participant directed.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the Plan) have duly caused this annual
report to be signed by the undersigned hereunto duly authorized.
CFC INTERNATIONAL, INC. EMPLOYEES'
SAVINGS AND INVESTMENT PLAN
BY: /s/ Dennis W. Lakomy
Dennis W. Lakomy
Plan Administrator
Date: June 25, 2004