-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JI3hfsCz6wR0BEh5pVkAYw12j1tWrs/9fDcsAHwtS5nXdQmaZx8iAL5fvW2+aFj8 uUHs0o3JEHyp3YsTZRgZ8Q== 0001157523-07-009941.txt : 20071017 0001157523-07-009941.hdr.sgml : 20071017 20071017172126 ACCESSION NUMBER: 0001157523-07-009941 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20071017 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20071017 DATE AS OF CHANGE: 20071017 FILER: COMPANY DATA: COMPANY CONFORMED NAME: APTARGROUP INC CENTRAL INDEX KEY: 0000896622 STANDARD INDUSTRIAL CLASSIFICATION: PLASTICS PRODUCTS, NEC [3089] IRS NUMBER: 363853103 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-11846 FILM NUMBER: 071177108 BUSINESS ADDRESS: STREET 1: 475 W TERRA COTTA AVE STREET 2: STE E CITY: CRYSTAL LAKE STATE: IL ZIP: 60014 BUSINESS PHONE: 8154770424 MAIL ADDRESS: STREET 1: 475 W. TERRA COTTA AVE. SUITE E CITY: CRYSTAL LAKE STATE: IL ZIP: 60014 8-K 1 a5519720.txt APTARGROUP, INC. 8-K ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 October 17, 2007 ---------------- Date of Report (Date of earliest event reported) AptarGroup, Inc. ---------------- (Exact name of registrant as specified in its charter) Delaware 1-11846 36-3853103 -------- ------- ---------- (State or other (Commission File (IRS Employer jurisdiction of Number) Identification No.) incorporation) 475 West Terra Cotta Avenue, Suite E, Crystal Lake, Illinois 60014 ------------------------------------------------------------------ (Address of principal executive offices) Registrant's telephone number, including area code: 815-477-0424. ------------- N/A - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [_] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [_] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [_] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [_] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.02 Results of Operations and Financial Condition. --------------------------------------------- On October 17, 2007, AptarGroup, Inc. ("AptarGroup") announced its results of operations and financial condition for the quarter ended September 30, 2007. The press release regarding this announcement is furnished as Exhibit 99.1 hereto. The information in Item 2.02 of this Form 8-K and Exhibit 99.1 attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing. Item 5.02 Departure of Directors or Certain Officers; Election of Directors; ------------------------------------------------------------------ Appointment of Certain Officers; Compensatory Arrangements of ------------------------------------------------------------- Certain Officers ---------------- (e) On October 17, 2007, in connection with the previously announced appointment of Vice Chairman Peter Pfeiffer to succeed President and Chief Executive Officer Carl Siebel upon his retirement, AptarGroup entered into an Employment Agreement with Mr. Pfeiffer that pertains to his appointment as Chief Executive Officer beginning on January 1, 2008 (the "Employment Agreement"). The Employment Agreement provides for employment through December 31, 2010 at an initial salary of $750,000 per year, which amount may be increased (but not decreased) over the remaining term of the agreement. The Employment Agreement automatically extends for one additional year each December 31, unless terminated. If employment ends on account of death, Mr. Pfeiffer's estate will receive one-half of the annual salary that Mr. Pfeiffer would have received until the second anniversary of his death. If employment ends due to the expiration of the Employment Agreement, Mr. Pfeiffer is entitled to receive an amount equal to his salary until the first anniversary of the termination. If Mr. Pfeiffer is terminated without "cause" (as defined in the agreement), he is entitled to receive an amount equal to his salary until the date on which the agreement was scheduled to expire. If Mr. Pfeiffer's employment is terminated for any of the foregoing reasons or on account of disability or retirement during the third or fourth quarters of AptarGroup's fiscal year, he is entitled to receive any bonus payable, prorated for such fiscal year. If Mr. Pfeiffer terminates the agreement without "good reason" (as defined in the agreement) or AptarGroup terminates the agreement for cause, Mr. Pfeiffer is not entitled to payments under the Employment Agreement (other than certain accrued amounts and plan benefits which by their terms extend beyond termination of employment). After a change in control of AptarGroup, if Mr. Pfeiffer's employment is terminated by AptarGroup or its successor other than for cause, disability or death, or if Mr. Pfeiffer terminates his employment for "good reason," in each case within two years following the change in control, Mr. Pfeiffer is entitled to receive a lump-sum payment equal to (i) two times his highest annualized salary during the 12 month period preceding the termination and (ii) two times his highest annualized bonus in respect of the three fiscal years of AptarGroup immediately preceding the fiscal year in which the change in control occurs, plus a prorated annual bonus and the continuation of life insurance benefits for two years. In the event that such payments subject Mr. Pfeiffer to excise tax under Section 4999 of the Internal Revenue Code, Mr. Pfeiffer would generally be entitled to receive a "gross-up" payment to reimburse him for such excise tax. The agreement contains certain noncompetition and nonsolicitation covenants prohibiting Mr. Pfeiffer from, among other things, becoming employed by a competitor of AptarGroup for a period of one or two years following termination (depending on the nature of the termination). 2 Because Mr. Pfeiffer is a citizen and principal resident of Germany, certain employment benefits, including medical and life insurance benefits, and retirement benefits have been provided in existing agreements between Mr. Pfeiffer and a German subsidiary of AptarGroup. On October 17, 2007, AptarGroup's German subsidiary entered into a new Employment Agreement and Supplement to the Pension Scheme Arrangement with Mr. Pfeiffer. The new German Employment Agreement, which does not provide for salary in addition to the salary described above, becomes effective on January 1, 2008 and the existing German Employment Agreement terminates on that date. The Supplement to the Pension Scheme Arrangement provides for a one percent increase in Mr. Pfeiffer's pension benefit for each year of employment after age 60 until he attains 65 years of age. The description of the Employment Agreement, the new German Employment Agreement, and the Supplement to the Pension Scheme Arrangement in this Item 5.02 are qualified in their entirety by reference to the full text of these agreements, copies of which are attached hereto as Exhibits 10.1, 10.2, and 10.3, and incorporated herein by reference. On October 17, 2007, in connection with the previously announced retirement of President and Chief Executive Officer Carl Siebel that will be effective December 31, 2007, AptarGroup entered into a one-year Consulting Agreement with Carl Siebel Consulting GmbH, to become effective January 1, 2008 ("Consulting Agreement"). The Consulting Agreement may be extended by AptarGroup for additional one-year terms. Compensation for the consulting services to be provided by Mr. Siebel during the year ending December 31, 2008 will be (euro)165,000 or approximately $234,000 using current exchange rates and will be paid in equal monthly installments. Pursuant to the Consulting Agreement, which includes a noncompete provision, Carl Siebel Consulting GmbH will be an independent contractor, rather than Mr. Siebel being an employee, of AptarGroup. The description of the Consulting Agreement in this Item 5.02 is qualified in its entirety by reference to the full text of the Consulting Agreement, a copy of which is attached hereto as Exhibit 10.4 and incorporated herein by reference. 3 Item 9.01 Financial Statements and Exhibits. ---------------------------------- (d) Exhibits 10.1 Employment Agreement dated October 17, 2007 of Peter Pfeiffer. 10.2 German Employment Agreement dated October 17, 2007 of Peter Pfeiffer. 10.3 Supplement to the Pension Scheme Arrangement dated October 17, 2007 pertaining to the pension plan between a subsidiary of AptarGroup, Inc. and Peter Pfeiffer. 10.4 Consulting Agreement between AptarGroup, Inc. and Carl Siebel Consulting GmbH dated October 17, 2007. 99.1 Press release issued by AptarGroup, Inc. dated October 17, 2007. 4 SIGNATURES ---------- Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. AptarGroup, Inc. Date: October 17, 2007 By: /s/ Stephen J. Hagge -------------------- Stephen J. Hagge Executive Vice President, Chief Financial Officer and Secretary 5 Exhibit Index ------------- 10.1 Employment Agreement dated October 17, 2007 of Peter Pfeiffer. 10.2 German Employment Agreement dated October 17, 2007 of Peter Pfeiffer. 10.3 Supplement to the Pension Scheme Arrangement dated October 17, 2007 pertaining to the pension plan between a subsidiary of AptarGroup, Inc. and Peter Pfeiffer. 10.4 Consulting Agreement between AptarGroup, Inc. and Carl Siebel Consulting GmbH dated October 17, 2007. 99.1 Press Release issued by AptarGroup, Inc. dated October 17, 2007. 6 EX-10.1 2 a5519720ex10_1.txt Exhibit 10.1 EMPLOYMENT AGREEMENT -------------------- THIS EMPLOYMENT AGREEMENT between AptarGroup, Inc., a Delaware corporation (the "Company"), and Peter Pfeiffer (the "Executive") is entered into on October 17, 2007. WHEREAS, the Executive and Ing. Erich Pfeiffer GmbH, an indirect wholly-owned subsidiary of the Company (the "German Subsidiary"), are parties to an Employment Agreement dated April 22, 1993 (the "Existing German Employment Agreement") and to a Pension-Scheme Arrangement dated April 22, 1993, as amended by the Supplement to the Pension Scheme Agreement dated October 16, 2001 (the "Existing Pension Scheme"); WHEREAS, the Executive has given notice to the German Subsidiary that the Existing German Employment Agreement is to be terminated on April 21, 2008; and WHEREAS, the Company and the Executive desire that (i) the Executive be employed by the Company as its Chief Executive officer, effective January 1, 2008, pursuant to the terms of this Agreement, (ii) the Executive continue in his position as Managing Director of the German Subsidiary pursuant to the terms of a new employment agreement between the German Subsidiary and the Executive (the "New German Employment Agreement") to be effective January 1, 2008, (iii) the Existing German Employment Agreement be terminated on January 1, 2008, rather than April 21, 2008, and (iv) the Existing Pension Scheme be amended by a Supplement to the Pension Scheme Arrangement to be effective as of the date thereof (the Existing Pension Scheme, as so amended, is referred to herein as the "Pension Scheme"). NOW, THEREFORE, in consideration of the premises and the mutual agreements contained herein, the Company and the Executive hereby agree as follows: 1. Employment. The Company shall employ the Executive, and the Executive agrees to be employed by the Company, upon the terms and subject to the conditions set forth herein for the period beginning on January 1, 2008 and ending on December 31, 2010, unless earlier terminated pursuant to Section 4 hereof; provided, however, that such term shall automatically be extended as of each December 31, commencing December 31, 2008, for one additional year unless either the Company or the Executive shall have terminated this automatic extension provision by written notice to the other party at least 30 days prior to the automatic extension date; and provided further that in no event shall such term extend beyond June 28, 2013. The term of employment in effect from time to time hereunder is hereinafter called the "Employment Period." 2. Position and Duties. During the Employment Period, the Executive shall serve as the Chief Executive Officer of the Company and shall have the normal duties, responsibilities and authority of an executive serving in such position, subject to the direction of the Board of Directors of the Company (the "Board"). The Executive shall have the title of President and Chief Executive Officer and shall report to the Board. During the Employment Period, the Executive shall devote his best efforts and his full business time to the business and affairs of the Company and its subsidiaries. During the Employment Period, the Executive shall remain a resident of the Federal Republic of Germany and shall perform his services pursuant to this Agreement and pursuant to the New German Employment Agreement at such locations, and for such periods of time at each location, as the Board shall direct, including, without limitation, at the offices of the Company located in Crystal Lake, Illinois and the offices of the Company's subsidiaries located in St. Germain-en-Laye, France and in Radolfzell, Germany. 3. Compensation and Benefits. (a) In consideration for the performance of the Executive's services to the Company and its subsidiaries, the Executive shall be paid a salary during the Employment Period, in monthly installments, initially at the rate of $750,000 per annum. The Board or the Compensation Committee of the Board (the "Compensation Committee") may, in its sole discretion (i) increase (but not decrease) such salary from time to time and (ii) award a bonus to the Executive for any calendar year during the Employment Period. (b) The Executive shall be reimbursed for all reasonable expenses incurred by him in the course of performing his duties to the Company and its subsidiaries which are consistent with the Company's policies in effect from time to time. (c) During the Employment Period, the Executive shall be entitled to participate in the Company's executive benefit programs at the level of Chief Executive Officer, which programs consist of those benefits (including insurance, company car or car allowance and/or other benefits) for which substantially all of the executives of the Company are from time to time generally eligible, as determined from time to time by the Board or the Compensation Committee. Notwithstanding the foregoing, (i) in view of the pension benefits provided to the Executive pursuant to the Pension Scheme, the Executive shall not be entitled to participate in the AptarGroup Pension Plan or Supplemental Retirement Plan and (ii) in view of the medical and life insurance coverage provided by the social security system of the Federal Republic of Germany, the Executive shall not be entitled to participate in the medical and life insurance programs sponsored by the Company. The Executive shall be entitled to 30 days of paid vacation per calendar year. Any paid vacation days provided to the Executive pursuant to the New German Employment Agreement shall be credited against the number of paid vacation days provided pursuant to this Section 3(c). (d) In addition to participation in the Company's executive benefit programs pursuant to Section 3(c) hereof, the Executive also shall be entitled to (i) the benefits provided by the Pension Scheme and (ii) the benefits required to be provided to the Executive by any subsidiary of the Company pursuant to the laws applicable to such subsidiary. The Company hereby unconditionally guarantees the payment of all benefits required to be paid by the German Subsidiary to the Executive pursuant to the terms of the Pension Scheme. (e) The Executive's salary and bonus shall be paid to the Executive, the Executive's expenses shall be reimbursed and the Executive's benefits shall be provided (i) by the Company pursuant to the terms of this Agreement, (ii) by the German Subsidiary, including pursuant to the terms of the New German Employment Agreement, (iii) by another subsidiary of the Company or (iv) by a combination of the foregoing. Such payments, reimbursements and benefits shall be allocated, as determined by the Board, among the Company and its subsidiaries according to the services performed, and the expenses incurred, by the Executive for, or on behalf of, the Company and its subsidiaries. To the extent that any subsidiary of the Company, including, without limitation, the German Subsidiary, pays to the Executive any amount of salary, bonus or other compensation, reimburses the Executive for any expenses or provides the Executive with any benefits, such payment, reimbursement or benefit shall be credited against the Company's obligation to make such payment or reimbursement or provide such benefit pursuant to the terms of this Agreement. 2 4. Termination of Employment. (a) The Employment Period shall end upon the first to occur of: (i) the expiration of the term of this Agreement pursuant to Section 1 hereof, (ii) retirement of the Executive ("Retirement"), (iii) termination of the Executive's employment by the Company on account of the Executive's having become unable (as determined by the Board in good faith) to regularly perform his duties hereunder by reason of illness or incapacity for a period of more than six consecutive months ("Termination for Disability"), (iv) termination of the Executive's employment by the Company for Cause ("Termination for Cause"), (v) termination of the executive's employment by the Company other than a Termination for Disability or a Termination for Cause ("Termination Without Cause"), (vi) the Executive's death or (vii) termination of the Executive's employment by the Executive for any reason following written notice to the Company at least 90 days prior to the date of such termination ("Termination by the Executive"). All references in this Agreement to the Executive's termination of employment and to the end of the Employment Period shall mean a separation from service within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the "Code"). (b) For purposes of this Agreement, "Cause" shall mean (i) the commission of a felony involving moral turpitude, (ii) the commission of a fraud, (iii) the commission of any act involving dishonesty with respect to the Company or any of its subsidiaries or affiliates, (iv) gross negligence or willful misconduct with respect to the Company or any of its subsidiaries or affiliates, (v) breach of any provision of Section 5 or Section 6 hereof or (vi) any other breach of this Agreement which is material and which is not cured within 30 days following written notice thereof to the Executive by the Company. (c) If the Employment Period ends for any reason set forth in Section 4(a), except as otherwise provided in this Section 4, the Executive shall cease to have any rights to salary, bonus (if any) or benefits hereunder, other than (i) any unpaid salary accrued through the date of such termination; (ii) any bonus payable, but only if such termination occurs during the third or fourth quarter of the Company's fiscal year, such bonus to be prorated in accordance with Company policy; (iii) any unpaid expenses which shall have been incurred as of the date of such termination, which expenses shall be substantiated by the Executive and reimbursed by the Company promptly following such substantiation and in any event by the end of the Executive's taxable year next following his taxable year in which the Executive incurred such expenses; (iv) to the extent provided in any benefit plan in which the Executive has participated, any plan benefits which by their terms extend beyond termination of the Executive's employment; and (v) any payments or benefits to be provided to the Executive by the German Subsidiary, including pursuant to the terms of the New German Employment Agreement, or required to be provided to the Executive by any subsidiary of the Company pursuant to the laws applicable to such subsidiary, following, or in connection with, the termination of the Executive's employment. Notwithstanding the foregoing, if the Employment Period ends on account of Termination by the Executive other than for Good Reason (as defined in Section 4(i) hereof) pursuant to Section 4(h) hereof or Termination for Cause, the Executive shall not be entitled to any unpaid bonus accrued through the date of such termination. The termination payments and benefits specified by this Section 4 shall be made or provided to the Executive (i) by the Company pursuant to the terms of this Agreement, (ii) by the German Subsidiary pursuant to the terms of the New German Employment Agreement, (iii) by another subsidiary of the Company or (iv) by a combination of the foregoing. Such payments and benefits shall be allocated, as determined by the Board, among the Company and its subsidiaries according to the services performed by the Executive for the Company and its subsidiaries. To the extent that any termination payment or benefit is made or provided to the Executive by a subsidiary of the Company, including, without limitation, the German Subsidiary, including pursuant to the terms of the New German Employment Agreement, such payment or benefit shall be credited against the Company's obligation to make such payment or to provide such benefit pursuant to the terms of this Agreement. 3 (d) If the Employment Period ends on account of Retirement, the Executive shall receive no amounts and no benefits other than the amounts and benefits provided by the Pension Scheme and the amounts and benefits described in Section 4(c) hereof. (e) If the Employment Period ends on account of Termination for Disability, in addition to the amounts and benefits provided by the Pension Scheme and the amounts and benefits described in Section 4(c) hereof, the Executive shall receive the disability benefits to which he is entitled under any disability benefit plan in which the Executive has participated as an employee of the Company. (f) If the Employment Period ends on account of the Executive's death, in addition to the amounts and benefits provided by the Pension Scheme and the amounts and benefits described in Section 4(c) hereof, minus any amounts described in clause (v) of the first sentence of Section 4(c) hereof that relate to salary or bonus continuation (including, without limitation, the amounts described in Section 5(3) of the New German Employment Agreement), the Company shall pay to the Executive's estate (or such person or persons as the Executive may designate in a written instrument signed by him and delivered to the Company prior to his death) amounts equal to one-half of the amounts the Executive would have received as salary (based on the Executive's salary then in effect) had the Employment Period remained in effect until the second anniversary of the date of the Executive's death, at the times such amounts would have been paid. (g) If the Employment Period ends on account of Termination without Cause, in addition to the amounts and benefits provided by the Pension Scheme and the amounts and benefits described in Section 4(c) hereof, minus any amounts described in clause (v) of the first sentence of Section 4(c) hereof that relate to salary or bonus continuation, the Company shall, subject to Section 4(l) hereof, pay to the Executive amounts equal to the amounts the Executive would have received as salary (based on the Executive's salary then in effect) had the Employment Period remained in effect until the date on which (without any extension thereof, or, if previously extended, without any further extension thereof) it was then scheduled to end, at the times such amounts would have been paid, less any payments to which the Executive shall be entitled during such salary continuation period under any disability benefit plan in which the Executive has participated as an employee of the Company; provided, however, that in the event of the Executive's death during the salary continuation period, the Company shall pay to the Executive's estate (or such person or persons as the Executive may designate in a written instrument signed by him and delivered to the Company prior to his death) amounts during the remainder of the salary continuation period equal to one-half of the amounts which would have been paid to the Executive but for his death. It is expressly understood that the Company's payment obligations under this Section 4(g) shall cease in the event the Executive shall breach any provision of Section 5 or Section 6 hereof. 4 (h) Notwithstanding the foregoing provisions of this Section 4, in the event of a Change in Control (as defined in Appendix A hereto), the employment of the Executive hereunder shall not be terminated by the Company or any successor to the Company within two years following such Change in Control unless the Executive receives written notice of such termination from the Company or such successor at least 30 days prior to the date of such termination. In the event of such termination of employment by the Company or such successor other than a Termination for Cause, a Termination for Disability or due to the Executive's death (in which case the provisions of Section 4(c), 4(d), 4(e) or 4(f), as the case may be, shall apply), within two years following a Change in Control, or in the event that the Executive terminates his employment hereunder for Good Reason (as defined in Section 4(i) hereof) within two years following a Change in Control: (1) the Company shall, subject to Section 4(l) hereof, pay to the Executive within 30 days following the date of termination, in addition to the amounts and benefits provided by the Pension Scheme and the amounts and benefits described in clauses (i), (iii), (iv) and (v) of the first sentence of Section 4(c) hereof, minus any amounts described in clause (v) of the first sentence of Section 4(c) hereof that relate to salary or bonus continuation: (A) a cash amount equal to the sum of (i) the Executive's annual bonus in an amount at least equal to the highest annualized (for any fiscal year consisting of less than 12 full months or with respect to which the Executive has been employed by the Company for less than 12 full months) bonus paid or payable, including by reason of any deferral, to the Executive by the Company and its affiliated companies in respect of the three fiscal years of the Company (or such portion thereof during which the Executive performed services for the Company if the Executive shall have been employed by the Company for less than such three fiscal year period) immediately preceding the fiscal year in which the Change in Control occurs, multiplied by a fraction, the numerator of which is the number of days in the fiscal year in which the Change in Control occurs through the date of termination and the denominator of which is 365 or 366, as applicable, and (ii) any accrued vacation pay, in each case to the extent not theretofore paid; plus 5 (B) a lump-sum cash amount (subject to any applicable payroll or other taxes required to be withheld) in an amount equal to (i) two (2) times the Executive's highest annual base salary from the Company and its affiliated companies in effect during the 12-month period prior to the date of termination, plus (ii) two (2) times the Executive's highest annualized (for any fiscal year consisting of less than 12 full months or with respect to which the Executive has been employed by the Company for less than 12 full months) bonus, paid or payable, including by reason of any deferral, to the Executive by the Company and its affiliated companies in respect of the three fiscal years of the Company (or such portion thereof during which the Executive performed services for the Company if the Executive shall have been employed by the Company for less than such three fiscal year period) immediately preceding the fiscal year in which the Change in Control occurs; provided, however, that any amount paid pursuant to this Section 4(h)(1)(B) shall be paid in lieu of any other amount of severance relating to salary or bonus continuation to be received by the Executive upon termination of employment of the Executive under any severance plan, policy or arrangement of the Company; (2) for a period of two years commencing on the date of termination, the Company shall continue to keep in full force and effect all policies of life insurance with respect to the Executive and his dependents with the same level of coverage, upon the same terms and otherwise to the same extent as such policies shall have been in effect immediately prior to the date of termination or, if more favorable to the Executive, as provided generally with respect to other peer executives of the Company, and the Company and the Executive shall share the costs of the continuation of such insurance coverage in the same proportion as such costs were shared immediately prior to the date of termination; and (3) the Company shall pay to the Executive any compensation previously deferred by the Executive (together with any interest and earnings thereon) in accordance with the terms of the plans pursuant to which such compensation was deferred. In consideration for the payments and benefits set forth in this Section 4(h), the Executive agrees that if a Change in Control shall occur, the Executive shall not terminate his employment hereunder, other than for Good Reason, within one year following such Change in Control unless the Executive provides to the Company or any successor to the Company a written notice of such termination at least six months prior to the date of such termination. (i) For purposes of this Agreement "Good Reason" shall mean (x) a reduction by the Company in the Executive's rate of annual salary in effect immediately prior to the Change in Control, (y) a material reduction in any benefit afforded to the Executive pursuant to any benefit plan of the Company in effect immediately prior to the Change in Control, unless all comparable executives of the Company suffer a substantially similar reduction or (z) the relocation of the Executive's office to a location more than 60 miles from his current office. 6 (j) Notwithstanding anything in this Agreement to the contrary, in the event it shall be determined that any payment or distribution by the Company or its affiliated companies to or for the benefit of the Executive (whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise, but determined without regard to any additional payments required under this Section 4(j) or Appendix B hereto) (a "Payment") would be subject to the excise tax imposed by Section 4999 of the Code, or any interest or penalties are incurred by the Executive with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter collectively referred to as the "Excise Tax"), then the Executive shall be entitled to receive, subject to Section 4(l) hereof, an additional payment (a "Gross-Up Payment") in an amount such that after payment by the Executive of all taxes (including any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. Notwithstanding the foregoing provisions of this Section 4(j), if it shall be determined that the Executive is entitled to a Gross-Up Payment, but that the Executive, after taking into account the Payments and the Gross-Up Payment, would not receive a net after-tax benefit of at least $50,000 (taking into account both income taxes and any Excise Tax) as compared to the net after-tax proceeds to the Executive resulting from an elimination of the Gross-Up Payment and a reduction of the Payments, in the aggregate, to an amount (the "Reduced Amount") such that the receipt of Payments would not give rise to any Excise Tax, then no Gross-Up Payment shall be made to the Executive and the Payments, in the aggregate, shall be reduced to the Reduced Amount. All procedures relating to the determination and payment of the Gross-Up Payment are set forth in Appendix B hereto. (k) If the Employment Period ends solely on account of the expiration of the term of this Agreement pursuant to Section 1 hereof and not for any other reason set forth in this Section 4, the Executive shall, subject to Section 4(l) hereof, be entitled to receive, in addition to the amounts and benefits provided by the Pension Scheme and the amounts and benefits described in Section 4(c) hereof, minus any amounts described in clause (v) Section 4(c) hereof that relate to salary or bonus continuation, the amounts the Executive would have received as salary (based on the Executive's salary then in effect) at the times such amounts would otherwise have been paid had the Employment Period remained in effect for one year following the date of such termination. It is expressly understood that the Company's payment obligations under this Section 4(k) shall cease in the event the Executive shall breach any provision of Section 5 or Section 6 hereof. (l) Notwithstanding any other provision of this Agreement, the New German Employment Agreement or the Pension Scheme, if on the date that the Employment Period ends, (i) the Company is a publicly traded corporation and (ii) the Company determines that the Executive is a "specified employee," as defined in Section 409A of the Code, then to the extent that any amount payable under this Agreement, the New German Employment Agreement or the Pension Scheme (A) is payable as a result of the separation of the Executive's service, (B) constitutes the payment of nonqualified deferred compensation within the meaning of Section 409A of the Code and (C) under the terms of this Agreement would be payable prior to the six-month anniversary of the date on which the Employment Period ends, such payment shall be delayed until the earlier of (1) the six-month anniversary of the date on which the Employment Period ends and (2) the death of the Executive. Notwithstanding the requirement of Section 4(h)(1) hereof that payments to the Executive thereunder be made in a lump sum, if a Change in Control within the meaning of this Agreement does not constitute a "change in control event" within the meaning of Section 409A of the Code, the amounts payable pursuant to Section 4(h)(1) hereof shall be paid to the Executive, but with respect to the timing thereof, such payments shall be made in the installments, and during the period, described in Section 4(g) hereof. Each amount payable under this Agreement as a result of the separation of the Executive's service shall constitute a "separately identified amount" within the meaning of Treasury Regulation ss.1.409A-2(b)(2). This Agreement shall be interpreted and construed in a manner that avoids the imposition of excise taxes and other penalties under Section 409A of the Code ("409A Penalties"). In the event the terms of this Agreement would subject the Executive to 409A Penalties, the Company and the Executive shall cooperate diligently to amend the terms of this Agreement to avoid such 409A Penalties, to the extent possible. Notwithstanding the foregoing, under no circumstances shall the Company be responsible for any taxes, penalties, interest or other losses or expenses incurred by the Executive due to any failure to comply with Section 409A of the Code. 7 5. Confidential Information. The Executive acknowledges that the information, observations and data obtained by him while employed by the Company pursuant to this Agreement, as well as those obtained by him while employed by the Company or any of its subsidiaries or affiliates or any predecessor thereof prior to the date of this Agreement, concerning the business or affairs of the Company or any of its subsidiaries or affiliates or any predecessor thereof ("Confidential Information") are the property of the Company or such subsidiary or affiliate. Therefore, the Executive agrees that he shall not disclose to any unauthorized person or use for his own account any Confidential Information without the prior written consent of the Board unless and except to the extent that such Confidential Information becomes generally known to and available for use by the public other than as a result of the Executive's acts or omissions to act. The Executive shall deliver to the Company at the termination of the Employment Period, or at any other time the Company may request, all memoranda, notes, plans, records, reports, computer tapes and software and other documents and data (and copies thereof) relating to the Confidential Information or the business of the Company or any of its subsidiaries or affiliates which he may then possess or have under his control. 6. Noncompetition; Nonsolicitation. (a) The Executive acknowledges that in the course of his employment by the Company and its subsidiaries and affiliates pursuant to this Agreement he will become familiar, and during the course of his employment by the Company or any of its subsidiaries or affiliates or any predecessor thereof prior to the date of this Agreement he has become familiar, with trade secrets and customer lists of and other confidential information concerning the Company and its subsidiaries and affiliates and predecessors thereof and that his services have been and will be of special, unique and extraordinary value to the Company. (b) The Executive agrees that during the Employment Period and for one year thereafter in the case of either Termination for Good Reason following a Change in Control or Termination without Cause, or for two years thereafter in the case of termination of employment for any other reason, the ("Noncompetition Period') he shall not in any manner, directly or indirectly, through any person, firm or corporation, alone or as a member of a partnership or as an officer, director, stockholder, investor or employee of or in any other corporation or enterprise or otherwise, engage or be engaged, or assist any other person, firm corporation or enterprise in engaging or being engaged, in any business then actively being conducted by the Company or any of its subsidiaries or affiliates in any geographic area in which the Company or any of its subsidiaries or affiliates is conducting such business (whether through manufacturing or production, calling on customers or prospective customers, or otherwise). Notwithstanding the foregoing, subsequent to the Employment Period the Executive may engage or be engaged, or assist any other person, firm, corporation or enterprise in engaging or being engaged, in any business activity which is not competitive with a business activity being conducted by the Company or any of its subsidiaries or affiliates at the time subsequent to the Employment Period that the Executive first engages or assists in such business activity. 8 (c) The Executive further agrees that during the Noncompetition Period he shall not in any manner, directly or indirectly (i) induce or attempt to induce any employee of the Company or of any of its subsidiaries or affiliates to terminate or abandon his employment, or any customer of the Company or any of its subsidiaries or affiliates to terminate or abandon its relationship, for any purpose whatsoever, or (ii) in connection with any business to which Section 6(b) applies, call on, service, solicit or otherwise do business with any then current or prospective customer of the Company or of any of its subsidiaries or affiliates. (d) Nothing in this Section 6 shall prohibit the Executive from being (i) a stockholder in a mutual fund or a diversified investment company or (ii) a passive owner of not more than 2% of the outstanding stock of any class of a corporation any securities of which are publicly traded, so long as the Executive has no active participation in the business of such corporation. (e) If, at the time of enforcement of this Section 6, a court holds that the restrictions stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum period, scope or geographical area reasonable under such circumstances shall be substituted for the stated period, scope or area and that the court shall be allowed to revise the restrictions contained herein to cover the maximum period, scope and area permitted by law. 7. Enforcement. Because the services of the Executive are unique and the Executive has access to confidential information of the Company, the parties hereto agree that the Company would be damaged irreparably in the event any provision of Section 5 or Section 6 hereof were not performed in accordance with its terms or were otherwise breached and that money damages would be an inadequate remedy for any such nonperformance or breach. Therefore, the Company or its successors or assigns shall be entitled, in addition to other rights and remedies existing in their favor, to an injunction or injunctions to prevent any breach or threatened breach of any of such provisions and to enforce such provisions specifically (without posting a bond or other security). The Company and the Executive hereby agree that any action or suit relating to or arising out of this Agreement, or any action or suit otherwise relating to or arising out of the Executive's employment by the Company or its subsidiaries, shall be brought in federal or state court located in the State of Illinois. The Company and the Executive hereby specifically submit to the jurisdiction of any federal or state court located in the State of Illinois with respect to any action or suit relating to or arising out of this Agreement or otherwise relating to or arising out of the Executive's employment by the Company or its subsidiaries and further agree that service of process may be made within or without the State of Illinois by giving notice in the matter provided in Section 9 hereof. The Company and the Executive waive any right to a trial by jury in any dispute between them. 9 8. Survival. Sections 5, 6 and 7 hereof shall survive and continue in full force and effect in accordance with their respective terms, notwithstanding any termination of the Employment Period. 9. Notices. Any notice provided for in this Agreement shall be in writing and shall be either personally delivered, or sent by certified mail, return receipt requested, postage prepaid, addressed (a) if to the Executive, to Peter Pfeiffer, Guetebohlweg 12, 78343 Gaienhofen, Germany, and if to the Company, to AptarGroup, Inc., 475 West Terra Cotta Avenue, Suite E, Crystal Lake, Illinois 60014, attention: Stephen J. Hagge, Executive Vice President and Chief Financial Officer and Secretary, or (b) to such other address as either party shall have furnished to the other in accordance with this Section 9. 10. Severability. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision or any other jurisdiction, but this Agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein. 11. Entire Agreement. This Agreement, the New German Employment Agreement and the Pension Scheme constitute the entire agreement and understanding between the parties with respect to the subject matter hereof and supersede and preempt any prior understandings, agreements, including the Existing German Employment Agreement, or representations by or between the parties, written or oral, which may have related in any manner to the subject matter hereof. 12. Successors and Assigns. This Agreement shall inure to the benefit of and be enforceable by the Executive and his heirs, executors and personal representatives, and the Company and its successors and assigns. Any successor or assignee of the Company shall assume the liabilities of the Company hereunder. 13. Governing Law. This Agreement shall be governed by the internal laws (as opposed to the conflicts of law provisions) of the State of Illinois. 14. Amendment and Waiver. The provisions of this Agreement may be amended or waived only with the prior written consent of the Company and the Executive, and no course of conduct or failure or delay in enforcing the provisions of this Agreement shall affect the validity, binding effect or enforceability of this Agreement. 10 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above. APTARGROUP, INC. By: /s/ King Harris --------------- Name: King Harris Title: Chairman of the Board EXECUTIVE: /s/ Peter Pfeiffer ------------------ Peter Pfeiffer 11 Appendix A to Employment Agreement DEFINITION OF CHANGE IN CONTROL ------------------------------- "Change in Control" means: (1) the acquisition by any individual, entity or group (a "Person"), including any "person" within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), of beneficial ownership within the meaning of Rule 13d-3 promulgated under the Exchange Act, of more than 50% of either (i) the then outstanding shares of common stock of the Company (the "Outstanding Company Common Stock") or (ii) the combined voting power of the then outstanding securities of the Company entitled to vote generally in the election of directors (the "Outstanding Company Voting Securities"); provided, however, that the following acquisitions shall not constitute a Change in Control: (A) any acquisition directly from the Company (excluding any acquisition resulting from the exercise of a conversion or exchange privilege in respect of outstanding convertible or exchangeable securities unless such outstanding convertible or exchangeable securities were acquired directly from the Company), (B) any acquisition by the Company, (C) any acquisition by an employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company or (D) any acquisition by any corporation pursuant to a reorganization, merger or consolidation involving the Company, if, immediately after such reorganization, merger or consolidation, each of the conditions described in clauses (i), (ii) and (iii) of subsection (3) of this Appendix A shall be satisfied; and provided further that, for purposes of clause (B), if any Person (other than the Company or any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company) shall become the beneficial owner of more than 50% of the Outstanding Company Common Stock or more than 50% of the Outstanding Company Voting Securities by reason of an acquisition by the Company and such Person shall, after such acquisition by the Company, become the beneficial owner of any additional shares of the Outstanding Company Common Stock or any additional Outstanding Company Voting Securities and such beneficial ownership is publicly announced, such additional beneficial ownership shall constitute a Change in Control; (2) individuals who, as of the date hereof, constitute the Board (the "Incumbent Board") cease for any reason to constitute at least a majority of such Board; provided, however, that any individual who becomes a director of the Company subsequent to the date hereof whose election, or nomination for election by the Company's stockholders, was approved by the vote of at least a majority of the directors then comprising the Incumbent Board shall be deemed to have been a member of the Incumbent Board; and provided further, that no individual who was initially elected as a director of the Company as a result of an actual or threatened solicitation by a Person other than the Board for the purpose of opposing a solicitation by any other Person with respect to the election or removal of directors or any other actual or threatened solicitation of proxies or consents by or on behalf of any Person other than the Board shall be deemed to have been a member of the Incumbent Board; A-1 (3) consummation of a reorganization, merger or consolidation unless, in any such case, immediately after such reorganization, merger or consolidation, (i) 50% or more of the then outstanding shares of common stock of the corporation resulting from such reorganization, merger or consolidation and 50% or more of the combined voting power of the then outstanding securities of such corporation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals or entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such reorganization, merger or consolidation and in substantially the same proportions relative to each other as their ownership, immediately prior to such reorganization, merger or consolidation, of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as the case may be, (ii) no Person (other than the Company, any employee benefit plan (or related trust) sponsored or maintained by the Company or the corporation resulting from such reorganization, merger or consolidation (or any corporation controlled by the Company) and any Person which beneficially owned, immediately prior to such reorganization, merger or consolidation, directly or indirectly, more than 50% of the Outstanding Company Common Stock or the Outstanding Company Voting Securities, as the case may be) beneficially owns, directly or indirectly, more than 50% of the then outstanding shares of common stock of such corporation or more than 50% of the combined voting power of the then outstanding securities of such corporation entitled to vote generally in the election of directors and (iii) at least a majority of the members of the board of directors of the corporation resulting from such reorganization, merger or consolidation were members of the Incumbent Board at the time of the execution of the initial agreement or action of the Board providing for such reorganization, merger or consolidation; or (4) consummation of (i) a plan of complete liquidation or dissolution of the Company or (ii) the sale or other disposition of all or substantially all of the assets of the Company other than to a corporation with respect to which, immediately after such sale or other disposition, (A) 50% or more of the then outstanding shares of common stock thereof and 50% or more of the combined voting power of the then outstanding securities thereof entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such sale or other disposition and in substantially the same proportions relative to each other as their ownership, immediately prior to such sale or other disposition, of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as the case may be, (B) no Person (other than the Company, any employee benefit plan (or related trust) sponsored or maintained by the Company or such corporation (or any corporation controlled by the Company) and any Person which beneficially owned, immediately prior to such sale or other disposition, directly or indirectly, more than 50% of the Outstanding Company Common Stock or the Outstanding Company Voting Securities, as the case may be) beneficially owns, directly or indirectly, more than 50% of the then outstanding shares of common stock thereof or more than 50% of the combined voting power of the then outstanding securities thereof entitled to vote generally in the election of directors and (C) at least a majority of the members of the board of directors thereof were members of the Incumbent Board at the time of the execution of the initial agreement or action of the Board providing for such sale or other disposition. A-2 Appendix B to Employment Agreement PROVISIONS RELATING TO ---------------------- GROSS-UP PAYMENT ---------------- (a) Subject to the provisions of Paragraph (b) of this Appendix B, all determinations required to be made under Section 4(j), including whether and when a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be made by the Company's public accounting firm (the "Accounting Firm") which shall provide detailed supporting calculations both to the Company and the Executive within 15 business days of the receipt of notice from the Executive that there has been a Payment, or such earlier time as is requested by the Company. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting the Change in Control, the Executive shall appoint another nationally recognized public accounting firm to make the determinations required hereunder (which accounting firm shall then be referred to as the Accounting Firm hereunder). All fees and expenses of the Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment, as determined pursuant to Section 4(j) and this Appendix B shall be paid by the Company to the Executive within five days of the receipt of the Accounting Firm's determination. If the Accounting Firm determines that no Excise Tax is payable by the Executive, it shall furnish the Executive with a written opinion that failure to report the Excise Tax on the Executive's applicable federal income tax return would not result in the imposition of a negligence or similar penalty. Any determination by the Accounting Firm shall be binding upon the Company and the Executive. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by the Company should have been made ("Underpayment"), consistent with the calculations required to be made hereunder. In the event that the Company exhausts its remedies pursuant to Paragraph (b) of this Appendix B and the Executive thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be paid by the Company to or for the benefit of the Executive promptly and in any event by the end of the Executive's taxable year next following his taxable year in which the Executive pays the Excise tax. (b) The Executive shall notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of the Gross-Up Payment. Such notification shall be given as soon as practicable but no later than 10 business days after the Executive is informed in writing of such claim and shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. The Executive shall not pay such claim prior to the expiration of the 30-day period following the date on which the Executive gives such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If the Company notifies the Executive in writing prior to the expiration of such period that it desires to contest such claim, the Executive shall: B-1 (1) give the Company any information reasonably requested by the Company relating to such claim, (2) take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company, (3) cooperate with the Company in good faith in order effectively to contest such claim, and (4) permit the Company to participate in any proceedings relating to such claim; provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties with respect thereto) imposed as a result of such representation and payment of costs and expenses. Without limitation on the foregoing provisions of this Paragraph (b), the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forgo any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct the Executive to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and the Executive agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company shall determine; provided further, that if the Company directs the Executive to pay such claim and sue for a refund, the Company shall advance the amount of such payment to the Executive on an interest-free basis and shall indemnify and hold the Executive harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or penalties with respect thereto) imposed with respect to such advance or with respect to any imputed income with respect to such advance; and provided further, that any extension of the statute of limitations relating to payment of taxes for the taxable year of the Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, the Company's control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and the Executive shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority. (c) If, after the receipt by the Executive of an amount advanced by the Company pursuant to Paragraph (b) of this Appendix B, the Executive becomes entitled to receive, and receives, any refund with respect to such claim, the Executive shall (subject to the Company's complying with the requirements of Paragraph (b)) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by the Executive of an amount advanced by the Company pursuant to Paragraph (b) of this Appendix B, a determination is made that the Executive shall not be entitled to any refund with respect to such claim and the Company does not notify the Executive in writing of its intent to contest such denial of refund prior to the expiration of 30 days after such determination, then such advance shall be forgiven and shall not be required to be repaid and the amount of such advance shall offset, to the extent thereof, the amount of Gross-Up Payment required to be paid. B-2 EX-10.2 3 a5519720ex10_2.txt Exhibit 10.2 PETER PFEIFFER GERMAN EMPLOYMENT AGREEMENT EMPLOYMENT AGREEMENT -------------------- b e t w e e n Ing. Erich Pfeiffer GmbH, Oeschlestrasse 54-56, 78315 Radolfzell, Germany - hereinafter called "the Company" - represented by the sole shareholder Aptar GmbH, Hildebrandstrasse 20, 44319 Dortmund, Germany - of the one part - a n d Mr. Peter Pfeiffer, Gutebohlweg 12, 78343 Gaienhofen, Germany - hereinafter called "Managing Director" - - of the other part - Preamble This Agreement is concluded between the parties on the basis of the employment agreement between the Managing Director and AptarGroup, Inc., the indirect parent company of the Company, with regard to his appointment as Chief Executive officer of AptarGroup, Inc. as of January 1, 2008 ("CEO Employment Agreement"), which is attached as Annex 1. Section 1 --------- Mr. Peter Pfeiffer, being Managing Director (Geschaftsfuhrer) of the Company since August 1, 1978, shall be responsible for the coordination of the technical, commercial and financial activities of the company. Section 2 --------- (1)The Managing Director shall - in conjunction with the other Managing Directors of the Company - conduct the Company's business in accordance with the Law and the Articles of Association as well as in accordance with the instruction given from time to time or generally by the meeting of shareholders and the Board of Administration. The following legal transactions and acts of the Managing Director shall require the previous approval of the shareholder's meeting, unless already approved within the framework of accepted budgets or plans or the like: (a) acquisition, sale, encumbrance of real property and real property rights as well as the disposition thereof; (b) acquisition, sale and encumbrance of participations and the exercise of voting rights resulting from such participations; (c) conclusion of renting or leasing contracts concerning real estate, offices, warehouses or residential quarters, if and as far as the annual rent exceeds (euro) 250,000; 2 (d) conclusion of cartel, joint venture and enterprise (control) agreements; (e) granting of surety and guarantees, the conclusion of guarantee contracts or other assumption of liability, in so far as these go beyond the scope of the normal business of the Company or exceed (euro) 250,000 in the individual case; (f) granting or taking up of loans or other credits, the undertaking of obligations under bills of exchange, in so far as these go beyond the scope of the normal business of the Company or exceed (euro) 1,500,000 in the individual case; (g) establishment and dissolution of branches and/or permanent establishments; (h) commencement of new, or discontinuance of existing business fields which are of fundamental importance for the Company; (i) all other substantial legal acts or transactions going beyond the scope of the normal business of the Company. Section 3 --------- The Managing Director shall place at the disposal of the Company his working capacity as the efficient conduct of the Company's business may require and shall, to the best of his ability, promote the interests of the Company. 3 For the duration of this Agreement, the Managing Director shall not engage in any business activities, directly or indirectly, competitive with the business of the Company or its affiliated enterprises. The Managing Director is permitted to engage himself in activities related to the commercial or financial interests of his own and the Pfeiffer family provided it is not in conflict with or injurious to the activities of Aptargroup Inc. and its affiliated companies. Section 4 --------- (1)In consideration of his services, the Managing Director shall be paid a monthly salary determined in accordance with Section 3 of the CEO Employment Agreement payable on the last business day of each calendar month. Taxes and social security dues will be withheld by the Company in accordance with statutory provisions. (2)Between the Company and the Managing Director a separate Pension Scheme Arrangement has been concluded (Pensionsvereinbarung). (3)The Company shall reimburse the Managing Director for reasonable expenses as are incurred by him on the Company's business in accordance with Section 3 of the CEO Employment Agreement. 4 Section 5 --------- (1)The Managing Director shall be obliged to notify the Company without delay of any case when he is unable to carry out his work, to state the reasons and the foreseeable duration of such disability. (2)In case of prevention of exercising his assignment because of illness or other reasons not caused by gross negligence or intent of the Managing Director, the Managing Director will receive in addition to the cash payments of his statutory or private Sick Benefits Fund (Krankenversicherung) for a period of twelve months an allowance which amounts together with sick payments (Krankengeld) after taxation to the level of his net according to section 4 (1). (3)In case of his death, his survivors (Widow and children entitled to maintenance) still receive the base salary according to section 4 (1)for a period of three months beginning with expiry of the month of decease. For this period payments to the survivors of the pension scheme existing for the case of death of the Managing Director are omitted. Section 6 --------- The Managing Director shall, without undue delay and without special request, communicate to the Company any and all of the results of his professional work gained during the lifetime of this Agreement as well as all experiences, knowledge and observations gained or made thereby, and place all such results at the disposal of the Company. The provisions of the Law regarding Employee Inventions (Arbeitnehmererfindungsgesetz) shall apply. 5 Section 7 --------- (1)The Company shall employ the Managing Director, and the Managing Director agrees to be employed by the Company, upon the terms and subject to the conditions set forth herein for the period beginning on January 1, 2008 and ending on December 31, 2010, unless earlier terminated as specified hereafter; provided, however, that such term shall automatically be extended as of each December 31, commencing December 31, 2008, for one additional year unless either the Company or the Managing Director shall have terminated this automatic extension provision by written notice to the other party at least 30 days prior to the automatic extension date; and provided further that in no event shall such term extend beyond June 28, 2013; and provided further that in the event that the CEO Employment Agreement is terminated, the Company is entitled to terminate this Agreement (ordentliche Kundigung) with a notice period of one (1) month to the end of a month, subject to the condition that such termination may not lead to a termination of this Agreement effective prior to the termination of the CEO Employment Agreement. (2)If there is an important reason, this Agreement may be terminated prematurely with immediate effect and without notice period. (3)Upon notice of termination having been given for whatever reason by whatever party, the Company shall be at liberty at any time pending effective termination or expiration of this Agreement to grant leave of absence to the Managing Director and to suspend him or to dispense with his further services partly or wholly, however, without prejudice to the rights and obligations of the parties otherwise existing under this Agreement. (4) The Agreement terminates automatically at the 65th birthday of the Managing Director. (5) Any termination of this Agreement must be made in writing. Section 8 --------- The Managing Director shall preserve absolute secrecy regarding the activity and affairs of the Company and its related companies as well as regarding all information whatsoever received by him in the exercise or as a result of or in connection with his activities for the Company and its affiliated companies, in particular also in respect of the Company's working methods, experiences and inventions of any description, this obligation to continue also after the termination of the Agreement for whatever reason. 6 For every case of culpable contravention against this secrecy obligation the Managing Director shall pay to the Company a contractual penalty in the amount of 50% of his last earned annual salary. The Company expressly reserves the right to claim further damages exceeding the amount of the contractual penalty. The Company reserves the right to claim performance of this secrecy clause in addition to the contractual penalty and/or damages. Following the termination of this Agreement, the Managing Director shall deliver to the Company all documents, evidence and correspondence relating to the Company and Company matters. Section 9 --------- The Managing Director is entitled to an annual vacation of 30 working days, the vacation time to be determined with due consideration to the requirements of the Company's business. The annual vacation shall be increased if and when the applicable union contract shall provide for an increased maximum annual vacation. Section 10 ---------- In the event of any individual provision contained in the Agreement being or becoming ineffective legally for whatever reason, such ineffectiveness shall not prejudice the legal validity of any of the other provisions herein. 7 Section 11 ---------- The parties agree that, as of January 1, 2008, the employment agreement between the parties dated April 22, 1993 and terminated by the Managing Director effective April 21, 2008, shall be terminated. For the avoidance of doubt: such termination does not affect the Pension Scheme Arrangement between the parties according to Section 4 (2) above. Any amendment or supplement of this Agreement shall take effect only if made in writing. This Agreement is subject to the laws of the Federal Republic of Germany. Exclusive place of jurisdiction shall be at the place of office of the Company. Radolfzell, this 17th day of October 2007 /s/ Carl Siebel ------------------------ Ing. Erich Pfeiffer GmbH (represented by its shareholder Aptar GmbH) /s/ Peter Pfeiffer ------------------------ Peter Pfeiffer 8 EX-10.3 4 a5519720ex10_3.txt Exhibit 10.3 SUPPLEMENT TO THE PENSION SCHEME ARRANGEMENT --------------------------------- between Ing. Erich Pfeiffer GmbH, Oeschlestrasse 54-56, 78315 Radolfzell, Germany represented by the sole shareholder Aptar GmbH, Hildebrandstrasse 20, 44319 Dortmund, Germany and Mr. Peter Pfeiffer, Gutebohlweg 12, 78343 Gaienhofen, Germany. Regarding the pension scheme Arrangement between the parties of April 22, 1993 as amended by the Supplement of October 16, 2001, the parties hereby stipulate the following: With respect to Section III (2) of the Pension Scheme Arrangement, the parties confirm that to the extent Peter Pfeiffer continues to be employed by Ing. Erich Pfeiffer GmbH between his 60th and 65th year of life, the Old Age Pension will be increased by 1% (one per cent) for each year of employment completed after the 60th year of life. Radolfzell, this 17th day of October 2007 /s/ Carl Siebel - ------------------------ Ing. Erich Pfeiffer GmbH (represented by its shareholder Aptar GmbH) /s/ Peter Pfeiffer - ------------------------ Peter Pfeiffer EX-10.4 5 a5519720ex10_4.txt Exhibit 10.4 CONSULTING AGREEMENT -------------------- This Consulting Agreement (this "Agreement") is entered into as of October 17, 2007 between AptarGroup, Inc., a Delaware corporation (the "Company"), and Carl Siebel Consulting GmbH (the "Consultant"). WHEREAS, the Company desires to obtain the benefit of the Consultant's knowledge and experience by retaining the Consultant, and the Consultant desires to accept such position, upon the terms and subject to the conditions set forth herein. NOW, THEREFORE, in consideration of the mutual promises and agreements contained herein, the adequacy and sufficiency of which are hereby acknowledged, the Company and the Consultant hereby agree as follows: 1. Term of Agreement. The Company hereby agrees to retain the Consultant as a consultant, and the Consultant hereby agrees to be retained by the Company, upon the terms and subject to the conditions hereof for the period commencing on January 1, 2008 (the "Effective Date") and ending on the date which is the first annual anniversary of the Effective Date, unless earlier terminated pursuant to Section 5 hereof; provided, however, that this Agreement may be extended by the Company for additional one-year terms upon delivery of written notice of such renewal at least 60 days prior to the expiration of the term then in effect. 2. Consulting Services. During the Consulting Period, the Consultant shall be available to perform consulting services with respect to the businesses conducted by the Company. Such consulting services shall be related to such matters as the Chief Executive Officer of the Company may designate from time to time. The Consultant shall comply with reasonable requests for the Consultant's consulting services and shall devote reasonable time and reasonable best efforts, skill and attention to the performance of such consulting services, including travel reasonably required in the performance of such consulting services; provided, however, that the Consultant shall not be required to devote more than 72 hours during any calendar quarter during the Consulting Period to the performance of such consulting services. 3. Independent Contractor Status. The Consultant shall perform the consulting services described in Section 2 hereof as an independent contractor without the power to bind or represent the Company for any purpose whatsoever. The Consultant shall not, by virtue of being a consultant hereunder, be eligible to receive any employee benefits for which officers or other employees of the Company are eligible at any time. The Consultant hereby acknowledges its separate responsibility for all federal and state withholding taxes, Federal Insurance Contribution Act taxes and workers' compensation and unemployment compensation taxes, if applicable, and agrees to indemnify and hold the Company harmless from any claim or liability therefor. 4. Compensation. As compensation for the consulting services to be performed by the Consultant hereunder, the Company shall pay the Consultant a consulting fee at the rate of (euro)165,000 per annum, payable in equal monthly installments. The Company shall reimburse the Consultant, in accordance with the Company's policies and procedures, for all proper expenses incurred by the Consultant in providing consulting services hereunder. 5. Termination. (a) This Agreement may be terminated at any time by the Consultant on 30 days prior written notice to the Company. In the event of such termination by the Consultant, the Company shall pay to the Consultant any accrued and unpaid consulting fee payable to the Consultant pursuant to Section 4 hereof and shall reimburse the Consultant for expenses incurred by the Consultant pursuant to Section 4 hereof prior to the date of such termination. (b) This Agreement may be terminated at any time by the Company upon ritten notice to the Consultant in the event that the Consultant shall breach any covenant contained in Section 2, 6, 7 or 8 hereof. 6. Noncompetition; Nonsolicitation. (a) The Consultant acknowledges that during the Consulting Period it will become familiar with trade secrets and other confidential information concerning the Company and its subsidiaries and that the Consultant's services will be of special, unique and extraordinary value to the Company and its subsidiaries. (b) The Consultant agrees that during the Consulting Period it shall not in any manner, directly or indirectly, through any person, firm or corporation, alone or as a member of a partnership or as an officer, director, stockholder, investor or employee of or consultant to any other corporation or enterprise or otherwise, engage or be engaged, or assist any other person, firm, corporation or enterprise in engaging or being engaged, in any business that manufactures or sells Competing Products in any geographic area in which the Company or any of its subsidiaries is then conducting such business. "Competing Product" means any dispensing system including pumps, closures and aerosol valves. (c) The Consultant further agrees that during the Consulting Period it shall not (i) in any manner, directly or indirectly, induce or attempt to induce any employee of the Company or any of its subsidiaries to terminate or abandon his or her employment for any purpose whatsoever or (ii) in connection with any business to which Section 6(b) applies, call on, service, solicit or otherwise do business with any customer of the Company or any of its subsidiaries except as is necessary to perform properly the Consultant's duties under this Agreement. (d) Nothing in this Section 6 shall prohibit the Consultant from being (i) a stockholder in a mutual fund or a diversified investment company or (ii) a passive owner of not more than two percent of the outstanding stock of any class of a corporation, any securities of which are publicly traded, so long as the Consultant has no active participation in the business of such corporation. 2 (e) If, at any time of enforcement of this Section 6, a court or an arbitrator holds that the restrictions stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum period, scope or geographical area reasonable under such circumstances shall be substituted for the stated period, scope or area and that the court or arbitrator shall be allowed to revise the restrictions contained herein to cover the maximum period, scope and area permitted by law. This Agreement shall not authorize a court or arbitrator to increase or broaden any of the restrictions in this Section. 7. Confidentiality. The Consultant shall not, at any time during the Consulting Period, make use of or disclose, directly or indirectly, any (i) trade secret or other confidential or secret information of the Company or of any of its subsidiaries or (ii) other technical, business, proprietary or financial information of the Company or of any of its subsidiaries not available to the public generally or to the competitors of the Company or to the competitors of any of its subsidiaries ("Confidential Information"), except to the extent that such Confidential Information (a) becomes a matter of public record or is published in a newspaper, magazine or other periodical available to the general public, other than as a result of any act or omission of the Consultant, (b) is required to be disclosed by any law, regulation or order of any court or regulatory commission, department or agency, provided that the Consultant gives prompt notice of such requirement to the Company to enable the Company to seek an appropriate protective order, or (c) is necessary to perform properly the Consultant's duties under this Agreement. Promptly following the termination of the Consulting Period, the Consultant shall surrender to the Company all records, memoranda, notes, plans, reports, computer tapes and software and other documents and data which constitute Confidential Information which it may then possess or have under the Consultant's control (together with all copies thereof). 8. Inventions. The Consultant hereby assigns to the Company its entire right, title and interest in and to all discoveries and improvements, patentable or otherwise, trade secrets and ideas, writings and copyrightable material, which may be conceived by the Consultant or developed or acquired by it during the Consulting Period, which may pertain directly or indirectly to the business of the Company or any of its subsidiaries. The Consultant agrees to disclose fully all such developments to the Company upon its request, which disclosure shall be made in writing promptly following any such request. The Consultant shall, upon the Company's request, execute, acknowledge and deliver to the Company all instruments and do all other acts which are necessary or desirable to enable the Company or any of its subsidiaries to file and prosecute applications for, and to acquire, maintain and enforce, all patents, trademarks and copyrights in all countries. 9. Enforcement. The parties hereto agree that the Company and its subsidiaries would be damaged irreparably in the event that any provision of Section 6, 7 or 8 of this Agreement were not performed in accordance with its terms or were otherwise breached and that money damages would be an inadequate remedy for any such nonperformance or breach. Accordingly, the Company and its successors and permitted assigns shall be entitled, in addition to other rights and remedies existing in their favor, to an injunction or injunctions to prevent any breach or threatened breach of any of such provisions and to enforce such provisions specifically (without posting a bond or other security). The Consultant agrees that it will submit itself to the jurisdiction of the courts of the State of Illinois in any action by the Company to enforce an arbitration award against it or to obtain interim injunctive or other relief pending an arbitration decision. 3 10. Representations. The Consultant represents and warrants to the Company that (i) the execution, delivery and performance of this Agreement by the Consultant does not and will not conflict with, breach, violate or cause a default under any contract, agreement, instrument, order, judgment or decree to which the Consultant is a party or by which it is bound, (ii) the Consultant is not a party to or bound by any employment agreement, noncompetition agreement or confidentiality agreement with any other person or entity and (iii) upon the execution and delivery of this Agreement by the Company, this Agreement shall be the valid and binding obligation of the Consultant, enforceable in accordance with its terms. 11. Survival. Sections 7, 8 and 9 of this Agreement shall survive and continue in full force and effect in accordance with their respective terms, notwithstanding any termination of the Consulting Period. 12. Arbitration. Any dispute or controversy between the Company and the Consultant, whether arising out of or relating to this Agreement, the breach of this Agreement, or otherwise, shall be settled by arbitration in Chicago, Illinois administered by the American Arbitration Association, with any such dispute or controversy arising under this Agreement being so administered in accordance with its Commercial Rules then in effect, and judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. The arbitrator shall have the authority to award any remedy or relief that a court of competent jurisdiction could order or grant, including, without limitation, the issuance of an injunction. However, either party may, without inconsistency with this arbitration provision, apply to any court having jurisdiction over such dispute or controversy and seek interim provisional, injunctive or other equitable relief until the arbitration award is rendered or the controversy is otherwise resolved. Except as necessary in court proceedings to enforce this arbitration provision or an award rendered hereunder, or to obtain interim relief, neither a party nor an arbitrator may disclose the existence, content or results of any arbitration hereunder without the prior written consent of the Company and the Consultant. The Company and the Consultant acknowledge that this Agreement evidences a transaction involving interstate commerce. Notwithstanding any choice of law provision included in this Agreement, the United States Federal Arbitration Act shall govern the interpretation and enforcement of this arbitration provision. 13. Notices. All notices and other communications required or permitted hereunder shall be in writing and shall be deemed given when (i) delivered personally or by overnight courier to the following address of the other party hereto (or such other address for such party as shall be specified by notice given pursuant to this Section) or (ii) sent by facsimile to the following facsimile number of the other party hereto (or such other facsimile number for such party as shall be specified by notice given pursuant to this Section), with the confirmatory copy delivered by overnight courier to the address of such party pursuant to this Section: 4 If to the Company, to: AptarGroup, Inc. 475 West Terra Cotta Avenue, Suite E Crystal Lake, IL 60014 Attn: Chief Financial Officer Fax: 815-477-0481 If to the Consultant, to: Carl Siebel Consulting GmbH Petersenstrasse 8 40474 Dusseldorf Germany 14. Severability. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect the validity, legality or enforceability of any other provision of this Agreement or the validity, legality or enforceability of such provision in any other jurisdiction, but this Agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein. 15. Entire Agreement. This Agreement constitutes the entire agreement and understanding between the parties with respect to the subject matter hereof and supersedes and preempts any prior understandings, agreements or representations by or between the parties, written or oral, which may have related in any manner to the subject matter hereof. 16. Successors and Assigns. This Agreement shall be enforceable by the Consultant and its successors and assigns, and by the Company and its successors and assigns. 17. Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the internal laws of the State of Illinois without regard to principles of conflict of laws. 18. Amendment and Waiver. The provisions of this Agreement may be amended or waived only by the written agreement of the Company and the Consultant, and no course of conduct or failure or delay in enforcing the provisions of this Agreement shall affect the validity, binding effect or enforceability of this Agreement. 19. Counterparts. This Agreement may be executed in two counterparts, each of which shall be deemed to be an original and both of which together shall constitute one and the same instrument. 5 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above. APTARGROUP, INC. Name: King Harris ----------- Signature: /s/ King Harris --------------- Title: Chairman of the Board --------------------- CARL SIEBEL CONSULTING GMBH Name: Carl Siebel ----------- Signature: /s/ Carl Siebel --------------- 6 EX-99.1 6 a5519720ex99_1.txt Exhibit 99.1 AptarGroup Reports All-Time High Quarterly Results; Declares Dividend CRYSTAL LAKE, Ill.--(BUSINESS WIRE)--Oct. 17, 2007--AptarGroup, Inc. (NYSE:ATR) today reported the highest quarterly results in its history. The Company's Board of Directors also declared a quarterly dividend of $.13 per share. Third Quarter 2007 Highlights -- Earnings per share climbed 40% to a record $.56 per share -- German tax law changes contributed $.03 per share -- Sales rose 20% to a record $485.7 million -- Pharma and Beauty & Home segments were particularly strong -- $19.7 million spent to repurchase 545,000 shares THIRD QUARTER RESULTS For the quarter ended September 30, 2007, sales increased 20% to a record $485.7 million, up from $404.9 million a year ago. Strong dispensing system sales accounted for 13% of the growth while changes in exchange rates contributed 6% and acquisitions added 1%. Commenting on the quarter, Carl Siebel, President and CEO, said, "I'm pleased to report that we had another excellent quarter. Our international presence and dedication to being the innovation leader in our industry enabled us to once again post increased sales and profits across each of our business segments." Third Quarter Segment Sales Analysis (Growth Over Prior Year) Beauty & Total Home Closures Pharma AptarGroup -------------------------------------- Product and Custom Tooling Sales 15% 5% 21% 13% Currency Effects 6% 5% 7% 6% Sales from Acquired Companies 1% 1% 0% 1% -------------------------------------- Total Growth 22% 11% 28% 20% ====================================== Operating income increased to a record $57.4 million, up 29% from $44.6 million a year ago primarily due to the strength of the Pharma and Beauty & Home segments. Beauty & Home segment income (income before interest expense net of interest income, stock option and corporate expenses, income taxes and unusual items) increased 38% to $25.6 million driven by demand from the personal care and fragrance/cosmetic markets. Strong demand for nasal spray pumps and metered dose inhaler valves drove Pharma segment income to $29.4 million or an increase of 35%. Closures segment income rose 6% to $12.5 million primarily due to stronger sales to the food and beverage market. Diluted earnings per share increased 40% to a record $.56 per share compared to $.40 per share in the prior year. Included in 2007 earnings per share is a positive tax benefit of approximately $.03 per share related to tax law changes in Germany. Siebel added, "Record earnings were driven by strong demand for our innovative products, particularly in our Pharma and Beauty & Home segments where we also realized improved operating performance. Our Closures segment also posted increased profits primarily due to strong demand from the European and Latin American markets. However, Closures' growth was hampered by softer demand from the U.S. personal care market." YEAR-TO-DATE RESULTS For the year-to-date, sales increased 19% to a record $1.4 billion from approximately $1.2 billion a year ago. Dispensing system sales increased 12% while changes in exchange rates added 6% and acquisitions contributed 1% to AptarGroup's top line. Operating income increased to a record $161.6 million, up 34% from $120.8 million a year ago. Diluted earnings per share, including the $.03 per share positive tax benefit recorded in the third quarter, increased 41% to $1.48 per share compared to $1.05 per share a year ago. OUTLOOK Siebel commented, "Looking to the fourth quarter, we expect each of our business segments to grow over the prior year with notable strength coming from our Pharma and Beauty & Home segments. We estimate that diluted earnings per share for the fourth quarter will be in the range of $.43 to $.46 per share, or an increase of 13% to 21%, compared to $.38 per share reported a year ago." CASH DIVIDEND AND SHARE REPURCHASE PROGRAM The Board of Directors declared a quarterly dividend of $.13 per share, payable November 21, 2007 to shareholders of record as of October 31, 2007. Also during the quarter, the Company repurchased approximately 545,000 shares of common stock for $19.7 million leaving approximately 2.5 million shares authorized for repurchase at the end of the third quarter. OPEN CONFERENCE CALL There will be a conference call on Thursday October 18, 2007 at 8:00 a.m. CDT to discuss the Company's third quarter results for 2007. The call will last approximately one hour. Interested parties are invited to listen to a live webcast by visiting the Investor Relations page at www.aptargroup.com. Replay of the conference call can also be accessed on the Investor Relations page of the web site. AptarGroup, Inc. is a leading global supplier of a broad range of innovative dispensing systems for the fragrance/cosmetic, personal care, pharmaceutical, household and food/beverage markets. AptarGroup is headquartered in Crystal Lake, Illinois, with manufacturing facilities in North America, Europe, Asia, and South America. For more information, visit the AptarGroup web site at www.aptargroup.com. This press release contains forward-looking statements. Forward-looking statements are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 and are based on management's beliefs as well as assumptions made by and information currently available to management. Accordingly, AptarGroup's actual results may differ materially from those expressed or implied in such forward-looking statements due to known or unknown risks and uncertainties that exist including, but not limited to, those related to overall business conditions in the various markets in which AptarGroup operates, the competitive marketplace, fiscal and monetary policy, changes in foreign exchange rates, direct or indirect consequences of acts of war or terrorism, labor relations and other risks and uncertainties discussed from time to time in AptarGroup's filings with the Securities and Exchange Commission, including its Form 10-K's and 10-Q's. Readers are cautioned not to place undue reliance on forward-looking statements. APTARGROUP, INC. Condensed Consolidated Financial Statements (Unaudited) (In Thousands, Except Per Share Data) CONSOLIDATED STATEMENTS OF INCOME Three Months Ended Nine Months Ended September 30, September 30, --------------------- ----------------------- 2007 2006 2007 2006 ---------- ---------- ----------- ----------- Net Sales $ 485,692 $ 404,905 $1,408,409 $1,178,998 Cost of Sales (exclusive of depreciation shown below) 330,438 274,517 949,293 796,821 Selling, Research & Development and Administrative 65,773 57,406 205,303 177,863 Depreciation and Other Amortization 32,065 28,340 92,246 83,503 ---------- ---------- ----------- ----------- Operating Income 57,416 44,642 161,567 120,811 Other Income/(Expense): Interest Expense (4,880) (4,479) (14,335) (12,186) Interest Income 2,222 1,012 5,600 2,753 Equity in Results of Affiliates 158 177 426 420 Minority Interests (22) 38 (4) (94) Miscellaneous, net (303) (219) (1,513) (1,154) ---------- ---------- ----------- ----------- Income before Income Taxes 54,591 41,171 151,741 110,550 Provision for Income Taxes 15,196 12,928 45,798 34,829 ---------- ---------- ----------- ----------- Net Income $ 39,395 $ 28,243 $ 105,943 $ 75,721 ========== ========== =========== =========== Net Income per Share - - Basic (a) $ 0.58 $ 0.41 $ 1.54 $ 1.08 ========== ========== =========== =========== Net Income per Share - - Diluted (a) $ 0.56 $ 0.40 $ 1.48 $ 1.05 ========== ========== =========== =========== Average Number of Shares - - Basic (a) 68,488 69,292 68,902 69,838 Average Number of Shares - - Diluted (a) 70,909 70,878 71,717 72,066 (a) Previously reported Net Income per Share and Average Number of Shares have been restated to reflect the two-for-one stock split on May 9, 2007. APTARGROUP, INC. Condensed Consolidated Financial Statements (Unaudited) (continued) (In Thousands) CONSOLIDATED BALANCE SHEETS September 30, 2007 December 31, 2006 ASSETS Cash and Equivalents $ 270,073 $ 170,576 Receivables, net 380,187 320,969 Inventories 263,426 226,455 Other Current Assets 64,280 44,820 ------------------ ------------------ Total Current Assets 977,966 762,820 Net Property, Plant and Equipment 628,745 591,077 Goodwill, net 219,903 207,882 Other Assets 28,077 30,233 ------------------ ------------------ Total Assets $ 1,854,691 $ 1,592,012 ================== ================== LIABILITIES AND STOCKHOLDERS' EQUITY Short-Term Obligations $ 207,065 $ 127,424 Accounts Payable and Accrued Liabilities 340,368 272,761 ------------------ ------------------ Total Current Liabilities 547,433 400,185 Long-Term Obligations 146,545 168,877 Deferred Liabilities 85,733 76,550 ------------------ ------------------ Total Liabilities 779,711 645,612 Stockholders' Equity 1,074,980 946,400 ------------------ ------------------ Total Liabilities and Stockholders' Equity $ 1,854,691 $ 1,592,012 ================== ================== APTARGROUP, INC. Condensed Consolidated Financial Statements (Unaudited) (continued) (In Thousands) SEGMENT INFORMATION Three Months Ended Nine Months Ended September 30, September 30, --------------------- ----------------------- 2007 2006 2007 2006 ---------- ---------- ----------- ----------- NET SALES Beauty & Home $ 258,613 $ 212,400 $ 750,757 $ 615,291 Closures 126,519 113,808 368,032 328,738 Pharma 100,559 78,632 289,617 234,707 Other 1 65 3 262 ---------- ---------- ----------- ----------- Total Net Sales $ 485,692 $ 404,905 $1,408,409 $1,178,998 ========== ========== =========== =========== SEGMENT INCOME (1) Beauty & Home $ 25,561 $ 18,487 $ 78,136 $ 54,872 Closures 12,494 11,825 39,838 34,548 Pharma 29,407 21,731 78,445 58,642 Corporate Expenses and Other (10,213) (7,405) (35,943) (28,079) ---------- ---------- ----------- ----------- Total Income Before Interest and Taxes $ 57,249 $ 44,638 $ 160,476 $ 119,983 Less: Interest Expense, Net 2,658 3,467 8,735 9,433 ---------- ---------- ----------- ----------- Income before Income Taxes $ 54,591 $ 41,171 $ 151,741 $ 110,550 ========== ========== =========== =========== SEGMENT INCOME % Beauty & Home 9.9% 8.7% 10.4% 8.9% Closures 9.9% 10.4% 10.8% 10.5% Pharma 29.2% 27.6% 27.1% 25.0% Income before Interest and Taxes 11.8% 11.0% 11.4% 10.2% ========== ========== =========== =========== Notes to Condensed Consolidated Financial Statements: (1) - The Company evaluates performance of its business units and allocates resources based upon income before interest expense net of interest income, stock option and corporate expenses, income taxes and unusual items. CONTACT: AptarGroup, Inc. Stephen J. Hagge, 815-477-0424 -----END PRIVACY-ENHANCED MESSAGE-----