UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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 MAY 29, 2005
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or
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934.
For the transition period from _____________to______________
Commission File Number 1-11344
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A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
INTERMAGNETICS GENERAL CORPORATION
IGC SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
INTERMAGNETICS GENERAL CORPORATION
450 OLD NISKAYUNA ROAD
LATHAM, NEW YORK 12110-0461
IGC 401(K) RETIREMENT SAVINGS PLAN
INDEX
MAY 31, 2005 AND 2004
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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
* Other schedules required by 29 CFR 2520.103-8 of the Department of Labor
Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974 ("ERISA") have been omitted
because they are not applicable.
SIGNATURE......................................................................................10
EXHIBITS
23 Consent of Independent Registered Certified Public Accounting Firm...............12
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Participants and Administrator
IGC 401(k) Retirement 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 IGC 401(k) Retirement Savings Plan (the "Plan") at May 31, 2005 and 2004, 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 May 31, 2005 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.
/s/ PriceWaterhouseCoopers LLP
Albany, New York
November 4, 2005
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IGC 401(K) RETIREMENT SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
MAY 31, 2005 AND 2004
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2005 2004
ASSETS
Investments, at fair value $ 30,617,874 $ 26,794,086
Investment, at contract value 4,185,207 -
Employee contributions receivable 112,381 33,241
Employer contributions receivable 1,147,759 598,393
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Net assets available for benefits $ 36,063,221 $ 27,425,720
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The accompanying notes are an integral part of the financial statements.
2
IGC 401(K) RETIREMENT SAVINGS PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEARS ENDED MAY 31, 2005 AND 2004
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2005 2004
INVESTMENT INCOME
Net appreciation in fair value of investments $ 2,111,240 $ 3,035,870
Interest and dividends 581,061 290,293
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Total investment income 2,692,301 3,326,163
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CONTRIBUTIONS
Participants 3,512,211 2,082,812
Employer 2,398,333 1,201,426
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Total contributions 5,910,544 3,284,238
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8,602,845 6,610,401
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DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO
Withdrawals and benefits paid to participants 7,929,583 2,062,481
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Total deductions 7,929,583 2,062,481
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Merger into Plan (note 1) 7,964,239 -
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Net increase 8,637,501 4,547,920
NET ASSETS AVAILABLE FOR BENEFITS
Beginning of year 27,425,720 22,877,800
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End of year $ 36,063,221 $ 27,425,720
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The accompanying notes are an integral part of the financial statements.
3
IGC 401(K) RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
MAY 31, 2005 AND 2004
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1. DESCRIPTION OF THE PLAN
The following brief description of IGC 401(k) Retirement Savings Plan
(the "Plan") provides only general information. Participants should refer
to the Plan agreement for a more complete description of the Plan's
provisions.
GENERAL
The Plan is a defined contribution employee savings plan covering
substantially all employees of Intermagnetics General Corporation (the
"Company"). The Plan became effective on February 1, 1985, and was
restated as of June 1, 1997. The Plan is subject to the provisions of the
Employee Retirement Income Security Act of 1974 (ERISA).
ELIGIBILITY
An employee must complete 30 days of service from the date of employment,
and have attained the age of 18 to be eligible to participate in the
Plan. Employees can join the Plan on the first Monday of the month
following the 30 days of employment.
CONTRIBUTIONS
Employees who elect to participate in the Plan may contribute on a pretax
basis up to 75% of their annual compensation, not to exceed certain
Internal Revenue Code (IRC) limitations. Participants may also contribute
amounts representing distributions from other qualified defined benefit
or defined contribution plans. Participants direct the investments of
their contributions into various options offered by the Plan. The Company
currently offers fourteen mutual funds, one insurance contract, brokerage
option and company stock as investment options for participants. Employer
contributions to the Plan are made equal to 50% of participant
contributions, up to 5% of their gross compensation, which includes a
participant's base compensation, overtime, fees, bonuses and commissions.
Company contributions are allocated to investment options on the same
basis as those chosen for participant contributions. Additional
non-elective and/or profit-sharing contributions are at the discretion of
the Company. Discretionary contributions of $1,111,345 and $590,794 were
made for the years ended May 31, 2005 and 2004, respectively. The Company
also contributes a supplemental frozen pension contribution for certain
employees who were employed before or on November 30, 1997 and were a
participant in the Intermagnetics General Corporation Pension Plan.
PARTICIPANT ACCOUNTS
Participants' accounts are credited with the participants' contributions
and allocations of (a) the Company's contribution and, (b) Plan earnings.
Allocations are based on participant account balances in the respective
funds elected.
VESTING
All participants immediately vest in their contributions while employer
matching contributions vest after one year of service, plus accumulated
earnings thereon. A participant vests in non-elective and/or
profit-sharing contributions, if any, based upon years of service and is
100% vested after five years of continuous service, death or disability,
or upon attainment of age 65.
FORFEITURES
Forfeitures, if any, from accounts of non-vested terminated participants
are allocated to pay administrative expenses or to reduce future employer
contributions. Forfeitures used to reduce employer contributions for the
year ended May 31, 2005 and 2004 totaled $31,406 and $62,655,
respectively.
4
IGC 401(K) RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
MAY 31, 2005 AND 2004
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PARTICIPANT LOANS
Participants may borrow from their accounts a minimum of $1,000 up to a
maximum equal to the lesser of $50,000 or 50% of their vested account
balances. Loans are collateralized by the balance in the participant's
account. Loan terms may not exceed five years, unless for the purchase of
a primary residence. The loans bear interest at a rate of prime plus 1%
at the time the loan is made, as determined by the plan administrator.
PAYMENT OF BENEFITS
On termination of service due to death, disability or retirement, a
participant becomes 100% vested and may elect to receive payment in the
form of a lump-sum or defer payment until the later of death, disability,
retirement or attainment of age 70-1/2. If a participant's account does
not exceed $3,500 for participants joining the Plan before August 5, 1997
or $5,000 for participants joining the Plan thereafter, a lump-sum
payment will be made.
A participant may also elect benefits to be paid under the qualifying
financial hardship provisions of the Plan.
MERGER
Effective January 31, 2005, MRI Devices Corporation 401(k) Profit Sharing
Plan (MRI) and Invivo Corporation 401(k) Plan (Invivo) merged into the
IGC 401(k) Retirement Savings Plan. As a result, all investments in
mutual funds and participant loans were transferred from the two plans
into the Plan on the aforementioned date. The total amount of the
transfer to the Plan is $5,308,177 for Invivo and $2,656,062 for MRI for
the year ended May 31, 2005.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The accompanying financial statements have been prepared on the accrual
basis of accounting.
INVESTMENTS
Investments are stated at fair value. The fair value of investments in
mutual funds is based on quoted market values on the last business day of
the Plan year. Investments in insurance contracts are valued at contract
value. Intermagnetics General Corporation common stock ("IGC Stock Fund")
owned by the Plan is carried at market value based on the latest quoted
market prices on the last business day of the plan year. Investments in
common collective trusts are valued at the fair value of the Plan's share
of the underlying investments. Participant loans are valued at cost,
which approximates fair value.
Security transactions are recorded on a trade-date basis. Gain or loss on
sales of the Company's common stock is determined using the first-in,
first-out (FIFO) method, and for mutual funds and common collective
trusts, based on the average cost for investments in the respective
funds.
ADMINISTRATIVE EXPENSES
The Plan's administrative expenses are paid by the Company for the years
ended May 31, 2005 and 2004.
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America 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.
5
IGC 401(K) RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
MAY 31, 2005 AND 2004
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PAYMENTS OF BENEFITS
Benefits are recorded when paid.
RISKS AND UNCERTAINTIES
The Plan provides for various investment options in any combination of
stock or insurance contract and mutual funds. Investment securities are
exposed to various risks, such as interest rate, market and credit. Due
to the high level of risk associated with certain investment securities
and the level of uncertainty related to changes in the value of
investment securities, it is at least reasonably possible that changes in
risk in the near term would materially affect participants' account
balances and the amounts reported in the statements of net assets
available for benefits and the statement of changes in net assets
available for benefits.
3. INVESTMENTS
A summary of plan investments as of May 31 is as follows:
2005 2004
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FAIR VALUE FAIR VALUE
Investment in mutual funds:
Oakmark International Fund $ 1,329,240 $ 312,936
PIMCO High Yield Fund, Class A 787,702 445,954
PIMCO Total Return Fund, Class A 3,308,165 * 1,178,548
American Century Equity Income 359,039 -
MainStay Balanced Fund RI 4,834,744 * -
MainStay S&P 500 Index Fund I 1,920,061 * -
The Growth Fund of America, Class R4 6,003,345 * -
Artisan Mid Cap Fund 1,291,079 -
Davis New York Venture Fund, Class A 1,934,375 * -
Forward Hoover Small Cap Equity 745,728 -
MainStay MAP Fund, Class R1 1,654,727 -
Third Avenue Small Cap Value 1,629,894 -
American EuroPacific Growth, Class R4 1,824,287 * -
NYL Brokerage Account 3,205 -
Putnam Small Cap Value Fund - 992,358
Ariel Appreciation Fund - 1,954,634 *
Van Kampen Emerging Growth - 391,491
Putnam Vista Fund - 747,372
Putnam Growth Opportunities Fund - 2,602,795 *
Putnam Research Fund - 1,261,688
Putnam Asset Allocation Growth Portfolio - 3,073,848 *
Putnam Asset Allocation Balanced Portfolio - 1,565,741 *
Putnam Asset Allocation Conservative Portfolio - 303,221
Putnam International Equity Fund - 744,597
Putnam Money Market Fund - 3,071,225 *
Putnam Equity Income Fund - 872,725
6
IGC 401(K) RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
MAY 31, 2005 AND 2004
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2005 2004
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FAIR VALUE FAIR VALUE
Growth Fund of America, Class R3 - 2,165,139 *
Columbia Small Cap Fund - 372,909
Putnam U.S. Government Income Trust - 1,414,961 *
Investment in insurance contract:
NYL Insurance Anchor Account I 4,185,207 * -
Investment in common/collective trust:
Putnam S&P 500 Index Fund - 1,361,830
Participant Loans 778,221 626,380
IGC Stock 2,062,040 * 1,333,734
MainStay Cash Reserves 152,022 -
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Total $ 34,803,081 $ 26,794,086
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* Represents 5% or more of net assets available for benefits
The related net appreciation in fair value for the years then ended follows:
2005 2004
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FAIR VALUE FAIR VALUE
Mutual Funds $ 1,392,180 $ 2,205,030
Common/Collective Trust 96,483 214,319
IGC Stock 622,577 616,521
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$ 2,111,240 $ 3,035,870
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4. INVESTMENT CONTRACT WITH INSURANCE COMPANY
In 2005, the Plan entered into a benefit-responsive investment contract
with New York Life Insurance Management (NYLIM). The account is credited
with earnings on the underlying investments and charged for participant
withdrawals and administrative expenses. The contract is included in the
financial statements at contract value as reported to the Plan by NYLIM.
Contract value represents contributions made under the contract, plus
earnings, less participant withdrawals and administrative expenses.
Participants may ordinarily direct the withdrawal or transfer of all of a
portion of their investment at contract value.
There are no reserves against contract value for credit risk of the
contract issuer or otherwise. The average yield and credited interest
rates were approximately 1.2% for 2005.
7
IGC 401(K) RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
MAY 31, 2005 AND 2004
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5. PLAN TERMINATION
Although it has not expressed any intent to do so, the Company may
terminate the Plan at any time. If the Plan is terminated, the assets of
the Plan shall be distributed to the participants based upon the
participants' respective accumulated account balances.
6. INCOME TAX STATUS
The Internal Revenue Service has determined and informed the Company by a
letter dated August 1, 2002, that the Plan and related trust are designed
in accordance with applicable sections of the IRC. Although the Plan has
been amended since receiving the determination letter, the Plan
administrator believes 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, common collective
trust and an insurance contract managed by NYLIM after January 31, 2005
and Putnam prior to January 31, 2005. NYLIM and Putnam are custodians and
record keepers as defined by the Plan and, therefore, these transactions
qualify as party-in-interest transactions. The Plan also invests in the
common stock of the Plan's sponsor, Intermagnetics General Corporation,
and holds participant loans. These transactions also qualify as
party-in-interest transactions.
8
IGC 401(K) RETIREMENT SAVINGS PLAN
SCHEDULE H, LINE 4I, SCHEDULE OF ASSETS (HELD AT END OF YEAR)
MAY 31, 2005 AND 2004
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DESCRIPTION OF CURRENT
IDENTITY OF ISSUE INVESTMENT VALUE
Oakmark International Fund Mutual Fund $ 1,329,240
* NYL Insurance Anchor Account I Insurance Contract 4,185,207
PIMCO High Yield Fund, Class A Mutual Fund 787,702
PIMCO Total Return Fund, Class A Mutual Fund 3,308,165
American Century Equity Income Mutual Fund 359,039
* MainStay Balanced Fund RI Mutual Fund 4,834,744
* MainStay S&P 500 Index Fund I Mutual Fund 1,920,061
The Growth Fund of America, Class R4 Mutual Fund 6,003,345
Artisan Mid Cap Fund Mutual Fund 1,291,079
Davis New York Venture Fund, Class A Mutual Fund 1,934,375
Forward Hoover Small Cap Equity Mutual Fund 745,728
* MainStay MAP Fund, Class R1 Mutual Fund 1,654,727
Third Avenue Small Cap Value Mutual Fund 1,629,894
American EuroPacific Growth, Class R4 Mutual Fund 1,824,287
NYL Brokerage Account Brokerage Account 3,205
* Participant Loans Loans (5.00%-10.50%) 778,221
* IGC Stock Common Stock 2,062,040
* MainStay Cash Reserves Money Market 152,022
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$ 34,803,081
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* Indicates that the issuer is a party-in interest as defined by ERISA.
9
SIGNATURES
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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.
INTERMAGNETICS GENERAL CORPORATION
IGC SAVINGS PLAN
(Name of Plan)
By: /s/Michael K. Burke
-----------------------------
Michael K. Burke
Executive Vice President and
Chief Financial Officer
Dated: November 23, 2005
10