10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2020

OR

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM  TO  

COMMISSION FILE NUMBER 1-11846

AptarGroup, Inc.

DELAWARE	36-3853103
(State of Incorporation)	(I.R.S. Employer Identification No.)

265 EXCHANGE DRIVE, SUITE 100, CRYSTAL LAKE, ILLINOIS 60014

815-477-0424

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, $.01 par value	ATR	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer þ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ◻ No þ

The number of shares outstanding of common stock, as of April 24, 2020, was 64,186,756 shares.

AptarGroup, Inc.

Form 10-Q

Quarter Ended March 31, 2020

INDEX

Part I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)
	Condensed Consolidated Statements of Income – Three Months Ended March 31, 2020 and 2019	1
	Condensed Consolidated Statements of Comprehensive Income – Three Months Ended March 31, 2020 and 2019	2
	Condensed Consolidated Balance Sheets – March 31, 2020 and December 31, 2019	3
	Condensed Consolidated Statements of Changes in Equity – Three Months Ended March 31, 2020 and 2019	5
	Condensed Consolidated Statements of Cash Flows - Three Months Ended March 31, 2020 and 2019	6
	Notes to Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	38
Item 4.	Controls and Procedures	38
Part II.	OTHER INFORMATION
Item 1A.	Risk Factors	40
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	40
Item 6.	Exhibits	41
	Signature	42

i

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

AptarGroup, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

In thousands, except per share amounts
Three Months Ended March 31,	2020		2019
Net Sales	$	721,553	$	744,460
Operating Expenses:
Cost of sales (exclusive of depreciation and amortization shown below)		451,256		469,132
Selling, research & development and administrative		126,192		121,215
Depreciation and amortization		50,806		47,489
Restructuring initiatives		4,839		9,530
		633,093		647,366
Operating Income		88,460		97,094
Other (Expense) Income:
Interest expense		(8,388)		(9,214)
Interest income		175		1,748
Equity in results of affiliates		(799)		(95)
Miscellaneous, net		(1,412)		466
		(10,424)		(7,095)
Income before Income Taxes		78,036		89,999
Provision for Income Taxes		22,786		27,000
Net Income	$	55,250	$	62,999
Net Loss Attributable to Noncontrolling Interests	$	3	$	5
Net Income Attributable to AptarGroup, Inc.	$	55,253	$	63,004
Net Income Attributable to AptarGroup, Inc. per Common Share:
Basic	$	0.86	$	1.00
Diluted	$	0.84	$	0.96
Average Number of Shares Outstanding:
Basic		64,009		62,964
Diluted		66,111		65,349
Dividends per Common Share	$	0.36	$	0.34

See accompanying unaudited Notes to Condensed Consolidated Financial Statements.

1

AptarGroup, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

In thousands
Three Months Ended March 31,	2020		2019
Net Income	$	55,250	$	62,999
Other Comprehensive (Loss) Income:
Foreign currency translation adjustments		(42,229)		(9,611)
Changes in derivative gains (losses), net of tax		1,483		(393)
Defined benefit pension plan, net of tax
Amortization of prior service cost included in net income, net of tax		71		84
Amortization of net loss included in net income, net of tax		1,565		637
Total defined benefit pension plan, net of tax		1,636		721
Total other comprehensive loss		(39,110)		(9,283)
Comprehensive Income		16,140		53,716
Comprehensive Loss (Income) Attributable to Noncontrolling Interests		3		(3)
Comprehensive Income Attributable to AptarGroup, Inc.	$	16,143	$	53,713

See accompanying unaudited Notes to Condensed Consolidated Financial Statements.

2

AptarGroup, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

In thousands
		March 31,		December 31,
		2020		2019
Assets
Current Assets:
Cash and equivalents	$	410,840	$	241,970
Accounts and notes receivable, less current expected credit loss ("CECL") of $5,657 in 2020 and $3,626 in 2019		602,027		558,428
Inventories		371,859		375,795
Prepaid and other		129,926		115,048
		1,514,652		1,291,241
Property, Plant and Equipment:
Buildings and improvements		502,706		504,328
Machinery and equipment		2,506,084		2,521,737
		3,008,790		3,026,065
Less: Accumulated depreciation		(1,961,683)		(1,963,520)
		1,047,107		1,062,545
Land		24,312		25,133
		1,071,419		1,087,678
Other Assets:
Investments in equity securities		39,167		8,396
Goodwill		756,081		763,461
Intangible assets		284,121		291,084
Operating lease right-of-use assets		65,925		72,377
Miscellaneous		45,187		47,882
		1,190,481		1,183,200
Total Assets	$	3,776,552	$	3,562,119

See accompanying unaudited Notes to Condensed Consolidated Financial Statements.

3

AptarGroup, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

In thousands, except share and per share amounts
		March 31,		December 31,
		2020		2019
Liabilities and Stockholders’ Equity
Current Liabilities:
Notes payable, revolving credit facility and overdrafts	$	220,511	$	44,259
Current maturities of long-term obligations, net of unamortized debt issuance costs		65,049		65,988
Accounts payable, accrued and other liabilities		605,738		573,028
		891,298		683,275
Long-Term Obligations, net of unamortized debt issuance costs		1,075,745		1,085,453
Deferred Liabilities and Other:
Deferred income taxes		39,795		41,388
Retirement and deferred compensation plans		104,140		101,225
Operating lease liabilities		49,004		55,276
Deferred and other non-current liabilities		28,947		23,250
Commitments and contingencies		—		—
		221,886		221,139
Stockholders’ Equity:
AptarGroup, Inc. stockholders’ equity
Common stock, $.01 par value, 199 million shares authorized, 68.9 and 68.6 million shares issued as of March 31, 2020 and December 31, 2019, respectively		689		686
Capital in excess of par value		785,567		770,596
Retained earnings		1,554,665		1,523,820
Accumulated other comprehensive loss		(381,058)		(341,948)
Less: Treasury stock at cost, 4.7 and 4.8 million shares as of March 31, 2020 and December 31, 2019, respectively		(372,573)		(381,238)
Total AptarGroup, Inc. Stockholders’ Equity		1,587,290		1,571,916
Noncontrolling interests in subsidiaries		333		336
Total Stockholders’ Equity		1,587,623		1,572,252
Total Liabilities and Stockholders’ Equity	$	3,776,552	$	3,562,119

See accompanying unaudited Notes to Condensed Consolidated Financial Statements.

4

AptarGroup, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Unaudited)

In thousands
	AptarGroup, Inc. Stockholders’ Equity
			Accumulated
			Other		Common				Capital in		Non-
	Retained		Comprehensive		Stock		Treasury		Excess of		Controlling		Total
	Earnings		(Loss) Income		Par Value		Stock		Par Value		Interest		Equity
Balance - December 31, 2018	$	1,371,826	$	(310,504)	$	673	$	(318,208)	$	678,769	$	315	$	1,422,871
Net income (loss)		63,004		—		—		—		—		(5)		62,999
Foreign currency translation adjustments		—		(9,619)		—		—		—		8		(9,611)
Changes in unrecognized pension gains (losses) and related amortization, net of tax		—		721		—		—		—		—		721
Changes in derivative gains (losses), net of tax		—		(393)		—		—		—		—		(393)
Stock awards and option exercises		—		—		3		5,337		22,164		—		27,504
Cash dividends declared on common stock		(21,377)		—		—		—		—		—		(21,377)
Treasury stock purchased		—		—		—		(15,000)		—		—		(15,000)
Balance - March 31, 2019	$	1,413,453	$	(319,795)	$	676	$	(327,871)	$	700,933	$	318	$	1,467,714
Balance - December 31, 2019	$	1,523,820	$	(341,948)	$	686	$	(381,238)	$	770,596	$	336	$	1,572,252
Net income (loss)		55,253		—		—		—		—		(3)		55,250
Adoption of CECL standard		(1,377)		—		—		—		—		—		(1,377)
Foreign currency translation adjustments		—		(42,229)		—		—		—		—		(42,229)
Changes in unrecognized pension gains (losses) and related amortization, net of tax		—		1,636		—		—		—		—		1,636
Changes in derivative gains (losses), net of tax		—		1,483		—		—		—		—		1,483
Stock awards and option exercises		—		—		3		8,665		14,971		—		23,639
Cash dividends declared on common stock		(23,031)		—		—		—		—		—		(23,031)
Balance - March 31, 2020	$	1,554,665	$	(381,058)	$	689	$	(372,573)	$	785,567	$	333	$	1,587,623

See accompanying unaudited Notes to Condensed Consolidated Financial Statements.

5

AptarGroup, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

In thousands, brackets denote cash outflows
Three Months Ended March 31,		2020		2019
Cash Flows from Operating Activities:
Net income	$	55,250	$	62,999
Adjustments to reconcile net income to net cash provided by operations:
Depreciation		42,792		41,487
Amortization		8,014		6,002
Stock-based compensation		9,141		6,565
Provision for CECL		1,251		497
Loss on disposition of fixed assets		54		310
Deferred income taxes		6		671
Defined benefit plan expense		5,775		3,858
Equity in results of affiliates		799		95
Changes in balance sheet items, excluding effects from foreign currency adjustments:
Accounts and other receivables		(64,764)		(35,301)
Inventories		(8,615)		(13,097)
Prepaid and other current assets		(11,787)		(2,282)
Accounts payable, accrued and other liabilities		45,458		6,865
Income taxes payable		(5,278)		3,511
Retirement and deferred compensation plan liabilities		(1,312)		(5,940)
Other changes, net		8,249		1,396
Net Cash Provided by Operations		85,033		77,636
Cash Flows from Investing Activities:
Capital expenditures		(61,625)		(51,742)
Proceeds from sale of property, plant and equipment		166		178
Acquisition of business, release of escrow		(1,463)		(4,036)
Acquisition of intangible assets, net		(3,955)		(221)
Investment in equity securities		(20,423)		—
Proceeds from sale of investment in equity securities		—		16,487
Notes receivable, net		(785)		231
Net Cash Used by Investing Activities		(88,085)		(39,103)
Cash Flows from Financing Activities:
Proceeds from notes payable and overdrafts		8,148		16,783
Repayments of notes payable and overdrafts		(2,030)		(21,130)
Proceeds and repayments of short term revolving credit facility, net		175,000		(78,222)
Proceeds from long-term obligations		—		10,446
Repayments of long-term obligations		(2,386)		(3,227)
Dividends paid		(23,031)		(21,377)
Proceeds from stock option exercises		18,602		20,939
Purchase of treasury stock		—		(15,000)
Net Cash Provided (Used) by Financing Activities		174,303		(90,788)
Effect of Exchange Rate Changes on Cash		(3,381)		2,809
Net Increase (Decrease) in Cash and Equivalents and Restricted Cash		167,870		(49,446)
Cash and Equivalents and Restricted Cash at Beginning of Period		246,973		266,823
Cash and Equivalents and Restricted Cash at End of Period	$	414,843	$	217,377

Restricted cash included in the line item prepaid and other on the Condensed Consolidated Balance Sheets as shown below represents amounts held in escrow related to the Noble Acquisition (as defined herein).

Three Months Ended March 31,		2020		2019
Cash and equivalents	$	410,840	$	217,377
Restricted cash included in prepaid and other		4,003		—
Total Cash and Equivalents and Restricted Cash shown in the Statement of Cash Flows	$	414,843	$	217,377

See accompanying unaudited Notes to Condensed Consolidated Financial Statements.

6

AptarGroup, Inc.

Notes to Condensed Consolidated Financial Statements

(Dollars in Thousands, Except per Share Amounts, or as Otherwise Indicated)

(Unaudited)

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of AptarGroup, Inc. and our subsidiaries. The terms “AptarGroup”, “Aptar”, “Company”, “we”, “us” or “our” as used herein refer to AptarGroup, Inc. and our subsidiaries. All significant intercompany accounts and transactions have been eliminated.

In the opinion of management, the unaudited Condensed Consolidated Financial Statements (the “Condensed Consolidated Financial Statements”) include all normal recurring adjustments necessary for a fair statement of consolidated financial position, results of operations, comprehensive income, changes in equity and cash flows for the interim periods presented. The accompanying Condensed Consolidated Financial Statements have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations, although we believe that the disclosures made are adequate to make the information presented not misleading. Also, certain financial position data included herein was derived from the audited Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2019 but does not include all disclosures required by U.S. GAAP. Accordingly, these Condensed Consolidated Financial Statements and related notes should be read in conjunction with the audited Consolidated Financial Statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019. The results of operations of any interim period are not necessarily indicative of the results that may be expected for the year.

There are many uncertainties regarding the current COVID-19 pandemic, including the scope of scientific and health issues, the anticipated duration of the pandemic and the extent of local and worldwide social, political and economic disruption it may cause. The pandemic has impacted our business, operations and financial results during the quarter ended March 31, 2020 including an overall reduction to net sales. No impairments were recorded as of March 31, 2020. While the disruption is currently expected to be temporary, there is uncertainty around the duration. Due to significant uncertainty surrounding the situation, our judgment regarding future results could change and therefore our results could be materially impacted.

ADOPTION OF RECENT ACCOUNTING STANDARDS

Changes to U.S. GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of Accounting Standards Updates (“ASUs”) to the FASB’s Accounting Standards Codification.

Effective January 1, 2020, we adopted ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, issued by the FASB in June 2016, as well as the clarifying amendments subsequently issued. We applied the guidance using a modified retrospective approach and accordingly recognized an amount of $1.4 million as the cumulative adjustment to opening retained earnings in the first quarter of 2020. This is based on management's best estimates of specific losses on individual exposures particularly on current trade receivables, as well as the time value of money and reasonable and supportable information that is available at the reporting date about past events, current conditions and forecasts of future economic conditions. On an ongoing basis, we will contemplate forward-looking economic conditions in recording lifetime expected credit losses for our financial assets measured at cost, such as our trade receivables and certain other assets.

In January 2017, the FASB issued ASU 2017-04, which provides guidance to simplify how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. As a result, impairment charges are required for the amount by which a reporting unit’s carrying amount exceeds its fair value up to the amount of its allocated goodwill. We adopted the standard on January 1, 2020 and did not record any impairment charges.

In August 2018, the FASB issued ASU 2018-15 to help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement (hosting arrangement) by providing guidance for determining when the arrangement includes a software license. The amendments in this update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). Accordingly, the amendments require an entity (customer) in a hosting arrangement that is a service contract to follow the guidance in Subtopic 350-40 to determine which implementation costs to capitalize as an asset related to the service contract and which costs to expense. The amendments also require the entity (customer) to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement, which includes reasonably certain renewals. We adopted the standard on January 1, 2020 and no material impacts were noted.

7

In August 2018, the FASB issued ASU 2018-13, which amends disclosure requirements for fair value measurements. The new standard modifies disclosure requirements including removing requirements to disclose the valuation process for Level 3 measurements and adding requirements to disclose the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements and the range and weighted average of significant unobservable inputs used to develop Level 3 measurements. We adopted the standard on January 1, 2020 and no material impacts were noted.

Other accounting standards that have been issued by the FASB or other standards-setting bodies did not have a material impact on our Condensed Consolidated Financial Statements.

INCOME TAXES

We compute taxes on income in accordance with the tax rules and regulations of the many taxing authorities where the income is earned. The income tax rates imposed by these taxing authorities may vary substantially. Taxable income may differ from pre-tax income for financial accounting purposes. To the extent that these differences create timing differences between the tax basis of an asset or liability and our reported amount in the financial statements, an appropriate provision for deferred income taxes is made.

We maintain our assertion that the cash and distributable reserves at our non-U.S. affiliates are indefinitely reinvested.  Under current U.S. tax laws, all of our non-U.S. earnings are subject to U.S. taxation. We will provide for the necessary withholding and local income taxes when management decides that an affiliate should make a distribution. These decisions are made taking into consideration the financial requirements of the non-U.S. affiliates and the global cash management goals of the Company.

We provide a liability for the amount of unrecognized tax benefits from uncertain tax positions. This liability is provided whenever we determine that a tax benefit will not meet a more-likely-than-not threshold for recognition.

The Company is subject to taxation and files income tax returns in the U.S. federal jurisdiction and many state and foreign jurisdictions. The Company believes that an adequate provision has been made for any adjustments that may result from tax examinations. However, the outcome of tax audits cannot be predicted with certainty. If any issues addressed in the Company’s tax audits are resolved in a manner inconsistent with its expectations, the Company could be required to adjust its provision for income taxes in the period such resolution occurs. The resolution of each of these audits is not expected to be material to our Condensed Consolidated Financial Statements.

NOTE 2 – REVENUE

At contract inception, we assess the goods and services promised in our contracts with customers and identify a performance obligation for each promise to transfer a good or service (or bundle of goods or services) that is distinct. To identify the performance obligations, we consider all the goods or services promised in the contract, whether explicitly stated or implied based on customary business practices. For a contract that has more than one performance obligation, we allocate the total contract consideration to each distinct performance obligation on a relative standalone selling price basis. Revenue is recognized when (or as) the performance obligations are satisfied (i.e., when the customer obtains control of the good or service). The majority of our revenues are derived from product and tooling sales; however, we also receive revenues from service, license, exclusivity and royalty arrangements, which collectively are not material to the year-to-date results. Revenue by segment and geography for the three months ended March 31, 2020 and 2019 is as follows:

	For the Three Months Ended March 31, 2020
					Latin
Segment	Europe		Domestic		America		Asia		Total
Beauty + Home	$	186,950	$	81,845	$	36,181	$	19,584	$	324,560
Pharma		190,130		90,965		6,579		9,522		297,196
Food + Beverage		28,769		57,590		8,034		5,404		99,797
Total	$	405,849	$	230,400	$	50,794	$	34,510	$	721,553

	For the Three Months Ended March 31, 2019
					Latin
Segment	Europe		Domestic		America		Asia		Total
Beauty + Home	$	216,233	$	86,979	$	42,642	$	21,805	$	367,659
Pharma		184,174		71,772		7,656		9,099		272,701
Food + Beverage		30,961		55,120		7,884		10,135		104,100
Total	$	431,368	$	213,871	$	58,182	$	41,039	$	744,460

8

We perform our obligations under a contract with a customer by transferring goods and/or services in exchange for consideration from the customer. The timing of performance will sometimes differ from the timing of the receipt of the associated consideration from the customer, thus resulting in the recognition of a contract asset or a contract liability. We recognize a contract asset when we transfer control of goods or services to a customer prior to invoicing for the related performance obligation. The contract asset is transferred to accounts receivable when the product is shipped and invoiced to the customer. We recognize a contract liability if the customer's payment of consideration precedes the entity's performance.

The opening and closing balances of our contract asset and contract liabilities are as follows:

	Balance as of		Balance as of		Increase/
	December 31, 2019		March 31, 2020		(Decrease)
Contract asset (current)	$	16,245	$	13,457	$	(2,788)
Contract asset (long-term)	$	—	$	—	$	—
Contract liability (current)	$	79,305	$	78,974	$	(331)
Contract liability (long-term)	$	9,779	$	14,994	$	5,215

The differences in the opening and closing balances of our contract asset and contract liabilities are primarily the result of timing differences between our performance and the customer’s payment. The total amount of revenue recognized during the current year against contract liabilities is $12.5 million, including $10.6 million relating to contract liabilities at the beginning of the year.

Determining the Transaction Price

In most cases, the transaction price for each performance obligation is stated in the contract. In determining the variable amounts of consideration within the transaction price (such as volume-based customer rebates), we include an estimate of the expected amount of consideration as revenue. We apply the expected value method based on all of the information (historical, current, and forecast) that is reasonably available and identify reasonable estimates based on this information. We apply the method consistently throughout the contract when estimating the effect of an uncertainty on the amount of variable consideration to which we will be entitled.

Product Sales

We primarily manufacture and sell dispensing, sealing and active packaging solutions. The amount of consideration is typically fixed for such customers. At the time of delivery, the customer is invoiced the agreed-upon price. Revenue from product sales is typically recognized upon manufacture or shipment, when control of the goods transfers to the customer.

To determine when the control transfers, we typically assess, among other things, the shipping terms of the contract, shipping being one of the indicators of transfer of control. A majority of product sales are sold free on board (“FOB”) shipping point. For FOB shipping point shipments, control of the goods transfers to the customer at the time of shipment of the goods. Therefore, our performance obligation is satisfied at the time of shipment. We have elected to account for shipping and handling costs that occur after the customer has obtained control of a good as fulfillment costs rather than as a promised service. We do not have any material significant payment terms as payment is typically received shortly after the point of sale.

There also exist instances where we manufacture highly customized products that have no alternative use to us and for which we have an enforceable right to payment for performance completed to date. For these products, we transfer control and recognize revenue over time by measuring progress towards completion using the Output Method based on the number of products produced. As we normally make our products to a customer’s order, the time between production and shipment of our products is typically within a few weeks.

As a part of our customary business practice, we offer a standard warranty that the products will materially comply with the technical specifications and will be free from material defects. Because such warranties are not sold separately, do not provide for any service beyond a guarantee of a product’s initial specifications, and are not required by law, there is no revenue deferral for these types of warranties.

9

Tooling Sales

We also build, or contract to build molds and other tools (collectively defined as “tooling”) necessary to produce our products. As with product sales, we recognize revenue when control of the tool transfers to the customer. If the tooling is highly customized with no alternative use to us and we have an enforceable right to payment for performance completed to date, we transfer control and recognize revenue over time by measuring progress towards completion using the Input Method based on costs incurred relative to total estimated costs to completion. Otherwise, revenue for the tooling is recognized at the point in time when the customer approves the tool. We do not have any material significant payment terms as payment is typically either received during the mold-build process or shortly after completion.

In certain instances, we offer extended warranties on tools sold to our customers above and beyond the normal standard warranties. We normally receive payment at the inception of the contract and recognize revenue over the term of the contract. At December 31, 2019, $515 thousand of unearned revenue associated with outstanding contracts was reported in Accounts Payable, Accrued and Other Liabilities. At March 31, 2020, the unearned amount was $432 thousand. We expect to recognize approximately $172 thousand of the unearned amount during the remainder of 2020, $123 thousand in 2021, and $137 thousand thereafter.

Credit Risk

We are exposed to credit losses primarily through our product sales, tooling sales and services to our customers. We assess each customer’s ability to pay for the products we sell by conducting a credit review. The credit review considers our expected billing exposure and timing for payment and the customer’s established credit rating or our assessment of the customer’s creditworthiness based on our analysis of their financial statements when a credit rating is not available. We also consider contract terms and conditions, country and political risks, and business strategy in our evaluation. A credit limit is established for each customer based on the outcome of this review.

We monitor our ongoing credit exposure through active review of customer balances against contract terms and due dates. Our activities include timely account reconciliation, dispute resolution and payment confirmation. We may employ collection agencies and legal counsel to pursue recovery of defaulted receivables.

At March 31, 2020, we reported $602 million of accounts receivable, net of CECL of $5.7 million. Changes in the allowance were not material for the three months ended March 31, 2020. Current uncertainty in credit and market conditions due to the COVID-19 pandemic may slow our collection efforts if customers experience significant difficulty accessing credit and paying their obligations, which may lead to higher than normal accounts receivable and increased CECL charges.

NOTE 3 - INVENTORIES

Inventories, by component, consisted of:

	March 31,		December 31,
	2020		2019
Raw materials	$	106,787	$	111,653
Work in process		120,151		123,750
Finished goods		144,921		140,392
Total	$	371,859	$	375,795

NOTE 4 – GOODWILL AND OTHER INTANGIBLE ASSETS

The changes in the carrying amount of goodwill by reporting segment since December 31, 2019 are as follows:

	Beauty +				Food +		Corporate
	Home		Pharma		Beverage		& Other		Total
Goodwill	$	221,658	$	413,650	$	128,153	$	1,615	$	765,076
Accumulated impairment losses		—		—		—		(1,615)		(1,615)
Balance as of December 31, 2019	$	221,658	$	413,650	$	128,153	$	—	$	763,461
Acquisition		—		463		—		—		463
Foreign currency exchange effects		(2,201)		(5,543)		(99)		—		(7,843)
Goodwill	$	219,457	$	408,570	$	128,054	$	1,615	$	757,696
Accumulated impairment losses		—		—		—		(1,615)		(1,615)
Balance as of March 31, 2020	$	219,457	$	408,570	$	128,054	$	—	$	756,081

10

The table below shows a summary of intangible assets as of March 31, 2020 and December 31, 2019.

		March 31, 2020							December 31, 2019
Weighted Average		Gross						Gross
Amortization Period		Carrying		Accumulated		Net		Carrying		Accumulated		Net
	(Years)	Amount		Amortization		Value		Amount		Amortization		Value
Amortized intangible assets:
Patents	7.9	$	3,001		(1,304)	$	1,697	$	2,804	$	(1,318)	$	1,486
Acquired technology	13.0		99,437		(27,143)		72,294		100,511		(25,430)		75,081
Customer relationships	13.7		216,198		(37,774)		178,424		217,934		(33,924)		184,010
Trademarks and trade names	6.9		34,131		(11,919)		22,212		35,015		(11,003)		24,012
License agreements and other	17.6		19,671		(10,177)		9,494		16,153		(9,658)		6,495
Total intangible assets	13.0	$	372,438	$	(88,317)	$	284,121	$	372,417	$	(81,333)	$	291,084

Aggregate amortization expense for the intangible assets above for the quarters ended March 31, 2020 and 2019 was $8,014 and $6,002, respectively.

Future estimated amortization expense for the years ending December 31 is as follows:

2020	$	20,725	(remaining estimated amortization for 2020)
2021		27,154
2022		26,915
2023		26,835
2024 and thereafter		182,492

Future amortization expense may fluctuate depending on changes in foreign currency rates. The estimates for amortization expense noted above are based upon foreign exchange rates as of March 31, 2020.

NOTE 5 – INCOME TAXES

The tax provision for interim periods is determined using the estimated annual effective consolidated tax rate, based on the current estimate of full-year earnings and related estimated full year-taxes, adjusted for the impact of discrete quarterly items.

The effective tax rate for the three months ended March 31, 2020 and 2019, respectively, was 29.2% and 30.0%. The decrease in the effective tax rate for the three months ended March 31, 2020 was primarily due to a larger tax benefit from employee share-based compensation offset in part by a mix of other discrete items.

NOTE 6 – DEBT

Notes Payable, Revolving Credit Facility and Overdrafts

At March 31, 2020 and December 31, 2019, our notes payable, revolving credit facility and overdrafts, consisted of the following:

	March 31,		December 31,
	2020		2019
Notes payable 8.10% due in 2020	$	2,664	$	1,436
Revolving credit facility 1.88% due in 2020		200,000		25,000
Overdrafts 5.68% - 7.82% due in 2020		17,847		17,823
	$	220,511	$	44,259

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We maintain a multi-currency revolving credit facility with two tranches that matures in July 2022 which provides for unsecured financing of up to $300 million that is available in the U.S. and up to €150 million that is available to our wholly-owned UK subsidiary. $200.0 million was utilized under our U.S. facility and no balance was utilized under our euro-based revolving credit facility as of March 31, 2020. $25.0 million was utilized under our U.S. facility and no balance was utilized on our euro-based revolving credit facility as of December 31, 2019.

There are no compensating balance requirements associated with our revolving credit facility. Each borrowing under the credit facility will bear interest at rates based on LIBOR, prime rates or other similar rates, in each case plus an applicable margin. A facility fee on the total amount of the facility is also payable quarterly, regardless of usage. The applicable margins for borrowings under the credit facility and the facility fee percentage may change from time to time depending on changes in our consolidated leverage ratio.

Long-Term Obligations

At March 31, 2020, our long-term obligations consisted of the following:

			Unamortized
			Debt Issuance
	Principal		Costs		Net
Notes payable 0.00% – 10.90%, due in monthly and annual installments through 2028	$	15,551	$	—	$	15,551
Senior unsecured notes 3.2%, due in 2022		75,000		59		74,941
Senior unsecured debts 3.1% USD floating swapped to 1.36% EUR fixed, equal annual installments through 2022		168,000		352		167,648
Senior unsecured notes 3.5%, due in 2023		125,000		135		124,865
Senior unsecured notes 1.0%, due in 2023		110,315		341		109,974
Senior unsecured notes 3.4%, due in 2024		50,000		60		49,940
Senior unsecured notes 3.5%, due in 2024		100,000		135		99,865
Senior unsecured notes 1.2%, due in 2024		220,630		701		219,929
Senior unsecured notes 3.6%, due in 2025		125,000		157		124,843
Senior unsecured notes 3.6%, due in 2026		125,000		157		124,843
Finance Lease Liabilities		28,395		—		28,395
	$	1,142,891	$	2,097	$	1,140,794
Current maturities of long-term obligations		(65,049)		—		(65,049)
Total long-term obligations	$	1,077,842	$	2,097	$	1,075,745

At December 31, 2019, our long-term obligations consisted of the following:

			Unamortized
			Debt Issuance
	Principal		Costs		Net
Notes payable 0.00% – 10.90%, due in monthly and annual installments through 2028	$	19,220	$	—	$	19,220
Senior unsecured notes 3.2%, due in 2022		75,000		64		74,936
Senior unsecured debts 3.2% USD floating swapped to 1.36% EUR fixed, equal annual installments through 2022		168,000		390		167,610
Senior unsecured notes 3.5%, due in 2023		125,000		144		124,856
Senior unsecured notes 1.0%, due in 2023		112,170		356		111,814
Senior unsecured notes 3.4%, due in 2024		50,000		63		49,937
Senior unsecured notes 3.5%, due in 2024		100,000		144		99,856
Senior unsecured notes 1.2%, due in 2024		224,340		742		223,598
Senior unsecured notes 3.6%, due in 2025		125,000		169		124,831
Senior unsecured notes 3.6%, due in 2026		125,000		169		124,831
Finance Lease Liabilities		29,952		—		29,952
	$	1,153,682	$	2,241	$	1,151,441
Current maturities of long-term obligations		(65,988)		—		(65,988)
Total long-term obligations	$	1,087,694	$	2,241	$	1,085,453

The aggregate long-term maturities, excluding finance lease liabilities, which are disclosed in Note 7, due annually from the current balance sheet date for the next five years are $61,181, $60,285, $134,343, $337,444, $270,846 and $250,397 thereafter.

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Covenants

Our revolving credit facility and corporate long-term obligations require us to satisfy certain financial and other covenants including:

	Requirement	Level at March 31, 2020
Consolidated Leverage Ratio (1)	Maximum of 3.50 to 1.00	1.73 to 1.00
Consolidated Interest Coverage Ratio (1)	Minimum of 3.00 to 1.00	16.32 to 1.00

(1) Definitions of ratios are included as part of the revolving credit facility agreement and the note purchase agreements.  

NOTE 7 – LEASES

We lease certain warehouse, plant and office facilities as well as certain equipment under noncancelable operating and finance leases expiring at various dates through the year 2032. Most of the operating leases contain renewal options and certain leases include options to purchase the related asset during or at the end of the lease term.

Amortization expense related to finance leases is included in depreciation expense while rent expense related to operating leases is included within cost of sales and selling research & development and administrative expenses (“SG&A”).

The components of lease expense for the three months ended March 31, 2020 and 2019 were as follows:

Three Months Ended March 31,	2020		2019
Operating lease cost	$	5,254	$	6,004
Finance lease cost:
Amortization of right-of-use assets	$	1,199	$	872
Interest on lease liabilities		348		315
Total finance lease cost	$	1,547	$	1,187
Short-term lease and variable lease costs	$	2,448	$	1,942

Supplemental cash flow information related to leases was as follows:

Three Months Ended March 31,	2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	5,328	$	6,469
Operating cash flows from finance leases		369		243
Financing cash flows from finance leases		1,657		1,140
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	5,233	$	4,515
Finance leases		220		10,697

NOTE 8 – RETIREMENT AND DEFERRED COMPENSATION PLANS

Components of Net Periodic Benefit Cost:

	Domestic Plans				Foreign Plans
Three Months Ended March 31,	2020		2019		2020		2019
Service cost	$	3,577	$	2,773	$	1,768	$	1,460
Interest cost		1,987		1,845		340		501
Expected return on plan assets		(3,422)		(3,094)		(634)		(592)
Amortization of net loss		1,548		489		514		363
Amortization of prior service cost		—		—		97		113
Net periodic benefit cost	$	3,690	$	2,013	$	2,085	$	1,845

The components of net periodic benefit cost, other than the service cost component, are included in the line “Miscellaneous, net” in the income statement.

13

EMPLOYER CONTRIBUTIONS

Although we have no minimum funding requirement, we contributed $204 thousand to our ongoing domestic supplemental employee retirement plan (“SERP”) annuity contracts during the three months ended March 31, 2020. We plan to contribute approximately an additional $200 thousand to pay our ongoing SERP annuity contracts during 2020. We have contributed approximately $711 thousand to our foreign defined benefit plans during the three months ended March 31, 2020 and do not expect additional significant contributions during 2020.

NOTE 9 – ACCUMULATED OTHER COMPREHENSIVE INCOME

Changes in Accumulated Other Comprehensive (Loss) Income by Component:

	Foreign		Defined Benefit
	Currency		Pension Plans		Derivatives		Total
Balance - December 31, 2018	$	(248,401)	$	(60,463)	$	(1,640)	$	(310,504)
Other comprehensive (loss) income before reclassifications		(9,619)		—		5,738		(3,881)
Amounts reclassified from accumulated other comprehensive income (loss)		—		721		(6,131)		(5,410)
Net current-period other comprehensive (loss) income		(9,619)		721		(393)		(9,291)
Balance - March 31, 2019	$	(258,020)	$	(59,742)	$	(2,033)	$	(319,795)
Balance - December 31, 2019	$	(257,124)	$	(83,147)	$	(1,677)	$	(341,948)
Other comprehensive (loss) income before reclassifications		(42,229)		—		5,026		(37,203)
Amounts reclassified from accumulated other comprehensive income (loss)		—		1,636		(3,543)		(1,907)
Net current-period other comprehensive (loss) income		(42,229)		1,636		1,483		(39,110)
Balance - March 31, 2020	$	(299,353)	$	(81,511)	$	(194)	$	(381,058)

Reclassifications Out of Accumulated Other Comprehensive (Loss) Income:

	Amount Reclassified from
Details about Accumulated Other	Accumulated Other				Affected Line in the Statement
Comprehensive Income Components	Comprehensive Income				Where Net Income is Presented
Three Months Ended March 31,	2020		2019
Defined Benefit Pension Plans
Amortization of net loss	$	2,062	$	852	(1)
Amortization of prior service cost		97		113	(1)
		2,159		965	Total before tax
		(523)		(244)	Tax benefit
	$	1,636	$	721	Net of tax
Derivatives
Changes in cross currency swap: interest component	$	(763)	$	(1,454)	Interest Expense
Changes in cross currency swap: foreign exchange component		(2,780)		(4,677)	Miscellaneous, net
	$	(3,543)	$	(6,131)	Net of tax
Total reclassifications for the period	$	(1,907)	$	(5,410)

(1) These accumulated other comprehensive income components are included in the computation of net periodic benefit costs, net of tax. See Note 8 – Retirement and Deferred Compensation Plans for additional details.

14

NOTE 10 – DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

We maintain a foreign exchange risk management policy designed to establish a framework to protect the value of our non-functional denominated transactions from adverse changes in exchange rates. Sales of our products can be denominated in a currency different from the currency in which the related costs to produce the product are denominated. Changes in exchange rates on such inter-country sales or intercompany loans can impact our results of operations. Our policy is not to engage in speculative foreign currency hedging activities, but to minimize our net foreign currency transaction exposure, defined as firm commitments and transactions recorded and denominated in currencies other than the functional currency. We may use foreign currency forward exchange contracts, options and cross currency swaps to economically hedge these risks.

For derivative instruments designated as hedges, we formally document the nature and relationships between the hedging instruments and the hedged items, as well as the risk management objectives, strategies for undertaking the various hedge transactions, and the method of assessing hedge effectiveness at inception. Quarterly thereafter, we formally assess whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in the fair value or cash flows of the hedged item. Additionally, in order to designate any derivative instrument as a hedge of an anticipated transaction, the significant characteristics and expected terms of any anticipated transaction must be specifically identified, and it must be probable that the anticipated transaction will occur. All derivative financial instruments used as hedges are recorded at fair value in the Condensed Consolidated Balance Sheets. See Note 11 - Fair Value for additional details.

Cash Flow Hedge

For derivative instruments that are designated and qualify as cash flow hedges, the changes in fair values are recorded in accumulated other comprehensive loss and included in changes in derivative gain/loss. The changes in the fair values of derivatives designated as cash flow hedges are reclassified from accumulated other comprehensive loss to net income when the underlying hedged item is recognized in earnings. Cash flows from the settlement of derivative contracts designated as cash flow hedges offset cash flows from the underlying hedged items and are included in operating activities in the Condensed Consolidated Statements of Cash Flows.

During 2017, our wholly-owned UK subsidiary borrowed $280 million in term loan borrowings under a new credit facility. In order to mitigate the currency risk of U.S. dollar debt on a euro functional currency entity and to mitigate the risk of variability in interest rates, we entered into a cross currency swap in the notional amount of $280 million to effectively hedge the foreign exchange and interest rate exposure on the $280 million term loan. This EUR/USD swap agreement fixed our U.S. dollar floating-rate debt to 1.36% euro fixed-rate debt. Related to this hedge, approximately $0.2 million of loss is included in accumulated other comprehensive loss at March 31, 2020. The amount expected to be recognized into earnings during the next 12 months related to the interest component of our cross currency swap based on prevailing foreign exchange and interest rates at March 31, 2020 is $2.2 million. The amount expected to be recognized into earnings during the next 12 months related to the foreign exchange component of our cross currency swap is dependent on fluctuations in currency exchange rates. As of March 31, 2020, the fair values of the cross currency swap were a $6.8 million asset. The swap contract expires on July 20, 2022.

Hedge of Net Investments in Foreign Operations

A significant number of our operations are located outside of the United States. Because of this, movements in exchange rates may have a significant impact on the translation of the financial condition and results of operations of our foreign subsidiaries. A strengthening U.S. dollar relative to foreign currencies has a dilutive translation effect on our financial condition and results of operations. Conversely, a weakening U.S. dollar has an additive effect. In some cases, we maintain debt in these subsidiaries to offset the net asset exposure. We do not otherwise actively manage this risk using derivative financial instruments. In the event we plan on a full or partial liquidation of any of our foreign subsidiaries where our net investment is likely to be monetized, we will consider hedging the currency exposure associated with such a transaction.

Other

As of March 31, 2020, we have recorded the fair value of foreign currency forward exchange contracts of $2.1 million in prepaid and other and $0.5 million in accounts payable and accrued liabilities on the balance sheet. All forward exchange contracts outstanding as of March 31, 2020 had an aggregate notional contract amount of $56.1 million.

15

Fair Value of Derivative Instruments in the Condensed Consolidated Balance Sheets as of March 31, 2020 and December 31, 2019

		March 31, 2020				December 31, 2019
				Derivatives				Derivatives
		Derivatives		not		Derivatives		not
		Designated		Designated		Designated		Designated
	Balance Sheet	as Hedging		as Hedging		as Hedging		as Hedging
	Location	Instruments		Instruments		Instruments		Instruments
Derivative Assets
Foreign Exchange Contracts	Prepaid and other	$	—	$	2,061	$	—	$	206
Cross Currency Swap Contract (1)	Prepaid and other		6,769		—		2,552		—
		$	6,769	$	2,061	$	2,552	$	206
Derivative Liabilities
Foreign Exchange Contracts	Accounts payable, accrued and other liabilities	$	—	$	505	$	—	$	401
		$	—	$	505	$	—	$	401

(1) This cross currency swap contract is composed of both an interest component and a foreign exchange component.

The Effect of Cash Flow Hedge Accounting on Accumulated Other Comprehensive Income (Loss) for the Three Months Ended March 31, 2020 and 2019

						Amount of Gain (Loss)				Total Amount
	Amount of Gain (Loss)				Location of (Loss)	Reclassified from				of Affected
Derivatives in Cash	Recognized in				Gain Recognized	Accumulated				Income
Flow Hedging	Other Comprehensive				in Income on	Other Comprehensive				Statement
Relationships	Income on Derivative				Derivatives	Income on Derivative				Line Item
	2020		2019			2020		2019
Cross currency swap contract:
Interest component	$	2,246	$	1,392	Interest expense	$	763	$	1,454	$	(8,388)
Foreign exchange component		2,780		4,677	Miscellaneous, net		2,780		4,677		(1,412)
	$	5,026	$	6,069		$	3,543	$	6,131

The Effect of Derivatives Not Designated as Hedging Instruments on the Condensed Consolidated Statements of Income for the Three Months Ended March 31, 2020 and 2019

		Amount of (Loss) Gain
Derivatives Not Designated	Location of (Loss) Gain Recognized	Recognized in Income
as Hedging Instruments	in Income on Derivatives	on Derivatives
		2020		2019
Foreign Exchange Contracts	Other (Expense) Income: Miscellaneous, net	$	1,747	$	(263)
		$	1,747	$	(263)

16

						Gross Amounts not Offset
			Gross Amounts	Net Amounts		in the Statement of
			Offset in the	Presented in		Financial Position
	Gross		Statement of	the Statement of		Financial	Cash Collateral	Net
	Amount		Financial Position	Financial Position		Instruments	Received	Amount
Description
March 31, 2020
Derivative Assets	$	8,830	—	$	8,830	—	—	$	8,830
Total Assets	$	8,830	—	$	8,830	—	—	$	8,830
Derivative Liabilities	$	505	—	$	505	—	—	$	505
Total Liabilities	$	505	—	$	505	—	—	$	505
December 31, 2019
Derivative Assets	$	2,758	—	$	2,758	—	—	$	2,758
Total Assets	$	2,758	—	$	2,758	—	—	$	2,758
Derivative Liabilities	$	401	—	$	401	—	—	$	401
Total Liabilities	$	401	—	$	401	—	—	$	401

NOTE 11 – FAIR VALUE

Authoritative guidelines require the categorization of assets and liabilities into three levels based upon the assumptions (inputs) used to price the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3 generally requires significant management judgment. The three levels are defined as follows:

● Level 1: Unadjusted quoted prices in active markets for identical assets and liabilities.

● Level 2: Observable inputs other than those included in Level 1. For example, quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets.

● Level 3: Unobservable inputs reflecting management’s own assumptions about the inputs used in pricing the asset or liability.

As of March 31, 2020, the fair values of our financial assets and liabilities were categorized as follows:

	Total		Level 1		Level 2		Level 3
Assets
Foreign exchange contracts (1)	$	2,061	$	—	$	2,061	$	—
Cross currency swap contract (1)		6,769		—		6,769		—
Total assets at fair value	$	8,830	$	—	$	8,830	$	—
Liabilities
Foreign exchange contracts (1)	$	505	$	—	$	505	$	—
Contingent consideration obligation		5,930		—		—		5,930
Total liabilities at fair value	$	6,435	$	—	$	505	$	5,930

As of December 31, 2019, the fair values of our financial assets and liabilities were categorized as follows:

	Total		Level 1		Level 2		Level 3
Assets
Foreign exchange contracts (1)	$	206	$	—	$	206	$	—
Cross currency swap contract (1)		2,552		—		2,552		—
Total assets at fair value	$	2,758	$	—	$	2,758	$	—
Liabilities
Foreign exchange contracts (1)	$	401	$	—	$	401	$	—
Contingent consideration obligation		5,930		—		—		5,930
Total liabilities at fair value	$	6,331	$	—	$	401	$	5,930

(1) Market approach valuation technique based on observable market transactions of spot and forward rates.

17

The carrying amounts of our other current financial instruments such as cash and equivalents, accounts and notes receivable, notes payable and current maturities of long-term obligations approximate fair value due to the short-term maturity of the instruments. We consider our long-term obligations a Level 2 liability and utilize the market approach valuation technique based on interest rates that are currently available to us for issuance of debt with similar terms and maturities. The estimated fair value of our long-term obligations was $1.0 billion as of March 31, 2020 and $1.1 billion as of December 31, 2019.

As discussed in Note 17 - Acquisitions, we have a contingent consideration obligation to the selling equity holders of Noble in connection with the Noble Acquisition (as defined herein) based on 2024 cumulative performance targets and a contingent consideration obligation to the selling equity holder of Gateway in connection with the Gateway Acquisition (as defined herein) based on 2020 and 2022 performance targets. We consider these obligations a Level 3 liability and have estimated the aggregate fair value for these contingent consideration arrangements to be $2.9 million and $3.0 million, respectively, as of March 31, 2020 and December 31, 2019.

NOTE 12 - COMMITMENTS AND CONTINGENCIES

The Company, in the normal course of business, is subject to a number of lawsuits and claims both actual and potential in nature. While management believes the resolution of these claims and lawsuits will not have a material adverse effect on our financial position, results of operations or cash flows, claims and legal proceedings are subject to inherent uncertainties, and unfavorable outcomes could occur and could include amounts in excess of any accruals which management has established. Were such unfavorable final outcomes to occur, it is possible that they could have a material adverse effect on our financial position, results of operations and cash flows.

Under our Certificate of Incorporation, we have agreed to indemnify our officers and directors for certain events or occurrences while the officer or director is, or was, serving at our request in such capacity. The maximum potential amount of future payments we could be required to make under these indemnification agreements is unlimited; however, we have a directors and officers liability insurance policy that covers a portion of our exposure. As a result of our insurance policy coverage, we believe the estimated fair value of these indemnification agreements is minimal. We have no liabilities recorded for these agreements as of March 31, 2020 and December 31, 2019.

A fire caused damage to our facility in Annecy, France in June 2016. We are insured for the damages caused by the fire, including business interruption insurance.  For the three months ended March 31, 2020, we did not receive any insurance proceeds, and have no insurance receivable as of March 31, 2020. During the three months ended March 31, 2020 and 2019, profitability was not impacted. The final settlement continues to be negotiated. In many cases, our insurance coverage exceeds the amount of our recognized losses. However, no gain contingencies were recognized during the three months ended March 31, 2020 as our ability to realize those gains remains uncertain.

An environmental investigation, undertaken to assess areas of possible contamination, was completed at our facility in Jundiaí, São Paulo, Brazil. The facility is primarily an internal supplier of anodized aluminum components for certain of our dispensing systems. The testing indicated that soil and groundwater in certain areas of the facility were impacted above acceptable levels established by local regulations. In March 2017, we reported the findings to the relevant environmental authority, the Environmental Company of the State of São Paulo – CETESB. Based upon our best estimate, we recorded a reserve of $1.5 million (operating expense) in the first quarter of 2017 related to this contingency. During 2019, we paid approximately $0.6 million. For the three months ended March 31, 2020, we paid approximately $0.1 million and made adjustments to the accrual based on our future anticipated expenditures.  As of March 31, 2020, our outstanding reserve is $0.4 million. The ultimate loss associated with this environmental contingency is subject to the investigation and ongoing review of the CETESB. We will continue to evaluate the range of likely costs as the investigation proceeds and we have further clarity on the nature and extent of remediation that will be required. We note that the contamination, or any failure to complete any required remediation in a timely manner, could potentially result in fines or penalties.

In March 2017, the Supreme Court of Brazil issued a decision that a certain state value added tax should not be included in the calculation of federal gross receipts taxes. The decision reduces our gross receipts tax in Brazil prospectively and, potentially, retrospectively. During the first quarter of 2019, we received a favorable court decision of $2.7 million for the retrospective right to recover part of our claim. This amount is recorded in cost of sales as a favorable impact of $1.7 million and $1.0 million was recognized as interest income. If the Judicial Court grants full retrospective recovery, we estimate remaining potential recoveries of approximately $2 million to $8 million, including interest, depending on the future decisions of the Supreme Court of Brazil. Due to uncertainties around our remaining court recovery claims, we have not recorded any further amounts relating to the retrospective nature of this matter.

In December 2019, tax authorities in Brazil notified us of a tax assessment of approximately $6.1 million, including interest and penalties of $2.3 million and $0.8 million, respectively, relating to differences in tax classification codes used for import duties for the period from January 2015 to August 2018. We are vigorously contesting the assessment, including interest and penalties, and have filed an administrative defense appeal in December 2019. Considering the complex nature of the assessment, we expect the appeal process to go through different levels of administrative and/or judicial review. Accordingly, due to uncertainty of the timing and amounts of assessment, no liability is recorded as of March 31, 2020.

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NOTE 13 – STOCK REPURCHASE PROGRAM

On April 18, 2019, we announced a share repurchase authorization of up to $350 million of common stock. This authorization replaces previous authorizations and has no expiration date. We may repurchase shares through the open market, privately negotiated transactions or other programs, subject to market conditions.

During the three months ended March 31, 2020, we did not repurchase any shares. During the three months ended March 31, 2019, the Company repurchased approximately 159 thousand shares for approximately $15.0 million. As of March 31, 2020, there was $278.5 million of authorized share repurchases available to us.

NOTE 14 – STOCK-BASED COMPENSATION

We issue restricted stock units (“RSUs”), which consist of time-based and performance-based awards, to employees under stock awards plans approved by stockholders. In addition, RSUs are issued to non-employee directors under a Restricted Stock Unit Award Agreement for Directors pursuant to the Company’s 2018 Equity Incentive Plan. RSUs granted to employees vest according to a specified performance period and/or vesting period. Time-based RSUs generally vest over three years. Performance-based RSUs vest at the end of the specified performance period, generally three years, assuming required performance or market vesting conditions are met. Performance-based RSUs have one of two vesting conditions: (1) based on our internal financial performance metrics and (2) based on our total shareholder return (“TSR”) relative to total shareholder returns of an industrial peer group. At the time of vesting, the vested shares of common stock are issued in the employee’s name. In addition, RSU awards are generally net settled (shares are withheld to cover the employee tax obligation). RSUs granted to directors are only time-based and generally vest over one year.

The fair value of both time-based RSUs and performance-based RSUs pertaining to internal performance metrics is determined using the closing price of our common stock on the grant date. The fair value of performance-based RSUs pertaining to TSR is estimated using a Monte Carlo simulation. Inputs and assumptions used to calculate the fair value are shown in the table below. The fair value of these RSUs is expensed over the vesting period using the straight-line method or using the graded vesting method when an employee becomes eligible to retain the award at retirement.

Three Months Ended March 31,		2020			2019
Fair value per stock award	$	94.98		$	134.97
Grant date stock price	$	83.93		$	104.51
Assumptions:
Aptar's stock price expected volatility		23.80	%		16.50	%
Expected average volatility of peer companies		48.50	%		31.90	%
Correlation assumption		63.50	%		37.40	%
Risk-free interest rate		0.31	%		2.19	%
Dividend yield assumption		1.72	%		1.30	%

A summary of RSU activity as of March 31, 2020 and changes during the three month period then ended is presented below:

	Time-Based RSUs			Performance-Based RSUs
		Weighted Average			Weighted Average
	Units	Grant-Date Fair Value		Units	Grant-Date Fair Value
Nonvested at January 1, 2020	480,729	$	95.45	181,680	$	117.26
Granted	176,424		81.75	206,408		90.85
Vested	(112,515)		82.64	—		—
Forfeited	(217)		100.14	(589)		120.61
Nonvested at March 31, 2020	544,421	$	92.11	387,499	$	103.23

Included in the March 31, 2020 time-based RSUs are 11,490 units granted to non-employee directors.

Compensation expense recorded attributable to RSUs for the first three months of 2020 and 2019 was approximately $8.3 million and $4.7 million, respectively. The actual tax benefit realized for the tax deduction from RSUs was approximately $1.5 million in the three months ended March 31, 2020. The fair value of units vested during the three months ended March 31, 2020 and 2019 was $9.3 million and $2.7 million, respectively. The intrinsic value of units vested during the three months ended March 31, 2020 and 2019 was $11.5 million and $3.2 million, respectively. As of March 31, 2020, there was $62.7 million of total unrecognized compensation cost relating to RSU awards which is expected to be recognized over a weighted-average period of 2.3 years.

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Historically we issued stock options to our employees and non-employee directors. Beginning in 2019, we no longer issue stock options. Stock options were awarded with the exercise price equal to the market price on the date of grant and generally vest over three years and expire 10 years after grant. Compensation expense attributable to employee stock options for the first three months of 2020 was approximately $0.9 million ($0.7 million after tax). Approximately $0.7 million of the compensation expense was recorded in selling, research & development and administrative expenses and the balance was recorded in cost of sales. Compensation expense attributable to stock options for the first three months of 2019 was approximately $1.8 million ($1.5 million after tax). Approximately $1.6 million of the compensation expense was recorded in selling, research & development and administrative expenses and the balance was recorded in cost of sales. The reduction in stock option expense is due to our move to RSUs as discussed above. For stock option grants, we used historical data to estimate expected life and volatility.

A summary of option activity under our stock plans during the three months ended March 31, 2020 is presented below:

	Stock Awards Plans					Director Stock Option Plans
			Weighted Average				Weighted Average
		Options	Exercise Price			Options	Exercise Price
Outstanding, January 1, 2020		5,044,180	$	68.32		135,251	$	58.45
Granted		—		—		—		—
Exercised		(292,090)		55.16		(21,251)		51.20
Forfeited or expired		(6,630)		65.60		—		—
Outstanding at March 31, 2020		4,745,460	$	69.20		114,000	$	59.80
Exercisable at March 31, 2020		4,583,864	$	68.43		114,000	$	59.80
Weighted-Average Remaining Contractual Term (Years):
Outstanding at March 31, 2020		5.3				3.2
Exercisable at March 31, 2020		5.1				3.2
Aggregate Intrinsic Value:
Outstanding at March 31, 2020	$	143,971			$	4,530
Exercisable at March 31, 2020	$	142,195			$	4,530
Intrinsic Value of Options Exercised During the Three Months Ended:
March 31, 2020	$	18,202			$	1,385
March 31, 2019	$	14,047			$	51

The grant date fair value of options vested during the three months ended March 31, 2020 and 2019 was $7.6 million and $12.2 million, respectively. Cash received from option exercises was approximately $18.6 million and the actual tax benefit realized for the tax deduction from option exercises was approximately $4.8 million in the three months ended March 31, 2020. As of March 31, 2020, the remaining valuation of stock option awards to be expensed in future periods was $1.5 million and the related weighted-average period over which it is expected to be recognized is 0.9 years.

NOTE 15 – EARNINGS PER SHARE

Basic net income per share is calculated by dividing net income attributable to Aptar by the weighted-average number of common shares outstanding during the period. Diluted net income per share is calculated by dividing the net income attributable to Aptar by the weighted-average number of common and common equivalent shares outstanding during the applicable period. The difference between basic and diluted earnings per share is attributable to stock-based compensation awards. Stock-based compensation awards for which total employee proceeds exceed the average market price over the applicable period would have an antidilutive effect on earnings per share, and accordingly, are excluded from the calculation of diluted earnings per share. The reconciliation of basic and diluted earnings per share for the three months ended March 31, 2020 and 2019 is as follows:

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	Three Months Ended
	March 31, 2020				March 31, 2019
	Diluted		Basic		Diluted		Basic
Consolidated operations
Income available to common stockholders	$	55,253	$	55,253	$	63,004	$	63,004
Average equivalent shares
Shares of common stock		64,009		64,009		62,964		62,964
Effect of dilutive stock-based compensation
Stock options		1,810		—		2,222		—
Restricted stock		292		—		163		—
Total average equivalent shares		66,111		64,009		65,349		62,964
Net income per share	$	0.84	$	0.86	$	0.96	$	1.00

NOTE 16 – SEGMENT INFORMATION

We are organized into three reporting segments. Our Beauty + Home segment sells to the personal care, beauty and home care markets. Our Pharma segment serves customers in the prescription drug, consumer health care, injectables and active packaging markets. Our Food + Beverage segment sells to the food and beverage markets.

The accounting policies of the segments are the same as those described in Part II, Item 8, Note 1 - Summary of Significant Accounting Policies in our Annual Report on Form 10-K for the year ended December 31, 2019. We evaluate performance of our business units and allocate resources based upon Adjusted EBITDA. Adjusted EBITDA is defined as earnings before net interest, taxes, depreciation, amortization, unallocated corporate expenses, restructuring and acquisition-related costs. All internal segment reporting and discussions of results with our Chief Operating Decision Maker (CODM) are based on segment Adjusted EBITDA.

Financial information regarding our reporting segments is shown below:

Three Months Ended March 31,	2020		2019
Total Sales:
Beauty + Home	$	330,466	$	373,503
Pharma		299,590		274,494
Food + Beverage		100,301		104,727
Total Sales	$	730,357	$	752,724
Less: Intersegment Sales:
Beauty + Home	$	5,906	$	5,844
Pharma		2,394		1,793
Food + Beverage		504		627
Total Intersegment Sales	$	8,804	$	8,264
Net Sales:
Beauty + Home	$	324,560	$	367,659
Pharma		297,196		272,701
Food + Beverage		99,797		104,100
Net Sales	$	721,553	$	744,460
Adjusted EBITDA (1):
Beauty + Home	$	34,247	$	53,191
Pharma		108,342		97,357
Food + Beverage		15,407		16,691
Corporate & Other, unallocated		(13,828)		(12,755)
Acquisition-related costs (2)		(2,274)		—
Restructuring Initiatives (3)		(4,839)		(9,530)
Depreciation and amortization		(50,806)		(47,489)
Interest Expense		(8,388)		(9,214)
Interest Income		175		1,748
Income before Income Taxes	$	78,036	$	89,999

(1) We evaluate performance of our reporting segments and allocate resources based upon Adjusted EBITDA. Adjusted EBITDA is defined as earnings before net interest, taxes, depreciation, amortization, unallocated corporate expenses, restructuring and acquisition-related costs.

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(2) Acquisition-related costs include transaction costs and purchase accounting adjustments related to acquisitions and investments (see Note 17 – Acquisitions and Note 18 – Investment in Equity Securities for further details).

(3) Restructuring Initiatives includes expense items for the three months ended March 31, 2020 and 2019 as follows (see Note 19 – Restructuring Initiatives for further details):

Three Months Ended March 31,	2020		2019
Restructuring Initiatives by Segment
Beauty + Home	$	4,907	$	8,269
Pharma		(31)		326
Food + Beverage		103		510
Corporate & Other		(140)		425
Total Restructuring Initiatives	$	4,839	$	9,530

NOTE 17 – ACQUISITIONS

Business Combinations

On February 13, 2020, we entered into a securities purchase agreement to acquire 100% of the equity interests (the “Fusion Acquisition”) of Fusion Packaging, Inc. (“Fusion”). Subsequent to the quarter end, on April 1, 2020 we closed on the Fusion Acquisition for a purchase price of approximately $165 million. Fusion, based in Dallas, TX, is a global leader in the design, engineering and distribution of luxury packaging for the beauty industry. The purchase agreement also provides an earn-out provision providing for the payment of up to $33.9 million based on Fusion’s financial performance during a 3 year measurement period.

On October 31, 2019, we completed our acquisition (the “Noble Acquisition”) of 100% of the equity interests of Noble International Holdings, Inc., Genia Medical, Inc. and JBCB Holdings, LLC (collectively referred to as “Noble”). Noble, based in Orlando, FL, is a leading provider in developing patient-centric advanced drug delivery system training devices including autoinjector, prefilled syringe, onbody and respiratory devices for the world’s leading biopharmaceutical companies and original equipment manufacturers. The purchase price was approximately $62.3 million (net of $1.6 million of cash acquired) and was funded by cash on hand. As part of the Noble Acquisition, we are also obligated to pay to the selling equityholders of Noble certain contingent consideration based on 2024 cumulative financial performance metrics defined in the purchase agreement. Based on projection as of the acquisition date, we estimated the aggregate fair value for this contingent consideration arrangement to be $2.9 million utilizing the Black-Scholes valuation model. As of December 31, 2019, $5 million was held in restricted cash pending the finalization of a working capital adjustment and indemnity escrow. During the first quarter of 2020, $1.0 million related to the working capital escrow was released from restriction, resulting in an additional $463 thousand payment due to the seller and a corresponding increase to our purchase price and associated goodwill balance. The results of Noble’s operations have been included in the Condensed Consolidated Financial Statements within our Pharma segment since the date of acquisition.

On June 5, 2019, we completed our acquisition (the “Nanopharm Acquisition”) of all of the outstanding capital stock of Nanopharm Ltd. (“Nanopharm”). Nanopharm, located in Newport, UK, is a science-driven, leading provider of orally inhaled and nasal drug product design and development services. The purchase price was approximately $38.1 million (net of $1.8 million of cash acquired) and was funded by cash on hand. The results of Nanopharm’s operations have been included in the Condensed Consolidated Financial Statements within our Pharma segment since the date of acquisition.

On May 31, 2019, we completed our acquisition (the “Gateway Acquisition”) of all of the outstanding equity interests of Gateway Analytical LLC (“Gateway”). Gateway, located in Gibsonia, PA, provides industry-leading particulate detection and predictive analytical services to customers developing injectable medicines. The purchase price was approximately $7.0 million and was funded by cash on hand. As part of the Gateway Acquisition, we are also obligated to pay to the selling equityholder of Gateway certain contingent consideration based on 2020 and 2022 performance targets defined in the purchase agreement. Based on projections as of the acquisition date, we estimated the aggregate fair value for this contingent consideration arrangement to be $3.0 million. The results of Gateway’s operations have been included in the Condensed Consolidated Financial Statements within our Pharma segment since the date of acquisition.

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The following table summarizes the assets acquired and liabilities assumed as of the acquisition date at estimated fair value.

	2019
Assets
Cash and equivalents	$	3,427
Accounts receivable		3,504
Prepaid and other		2,478
Property, plant and equipment		4,267
Goodwill		59,143
Intangible assets		52,980
Other miscellaneous assets		430
Liabilities
Accounts payable, accrued and other liabilities		5,388
Deferred income taxes		2,592
Deferred and other non-current liabilities		1,598
Net assets acquired	$	116,651

The following table is a summary of the fair value estimates of the acquired identifiable intangible assets and weighted-average useful lives as of the acquisition date:

	2019
	Weighted-Average	Estimated
	Useful Life	Fair Value
	(in years)	of Asset
Acquired technology	8	$	9,160
Customer relationships	11		39,379
Trademarks and trade names	4		2,457
License agreements and other	1		1,984
Total		$	52,980

Goodwill in the amount of $59.1 million was recorded related to the 2019 acquisitions which is included in the Pharma segment. Goodwill is calculated as the excess of the consideration transferred over the net assets acquired and represents the estimated future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. Goodwill largely consists of leveraging our commercial presence in selling the Noble, Nanopharm and Gateway lines of products in markets where they did not previously operate and the abilities of the acquired companies to maintain their competitive advantage from a technical viewpoint. Goodwill will not be amortized, but will be tested for impairment at least annually. For 2019 acquisitions, goodwill of $29.6 million will be deductible for tax purposes.

Asset Acquisition

On August 2, 2019, we completed our asset acquisition (the “Bapco Acquisition”) of the remaining 80% ownership interest in the capital stock of Bapco Closures Holdings Limited (“Bapco”), for $3.8 million (net of $2.9 million of cash acquired). The 20% ownership investment previously held in Bapco is now included within the intangible assets acquired. Bapco, located in Leeds, UK, provides innovative closures sealing technology that provides package integrity and tamper evidence. The results of Bapco’s operations have been included in the Condensed Consolidated Financial Statements within our Food + Beverage segment since the date of acquisition.

NOTE 18 –INVESTMENT IN EQUITY SECURITIES

Our investment in equity securities consisted of the following:

	March 31,		December 31,
	2020		2019
Equity Method Investments:
BTY	$	31,043	$	119
Kali Care		3,772		3,881
Desotec GmbH		811		858
Other Investments		3,541		3,538
	$	39,167	$	8,396

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Equity method investments

BTY

On October 1, 2019 we entered into a strategic definitive agreement to acquire 49% of the equity interests in 3 related companies: Suzhou Hsing Kwang, Suqian Hsing Kwang and Suzhou BTY (collectively referred to as “BTY”), contingent on the settlement date of the transaction. We have a call option to acquire an additional 26% to 31% of BTY’s equity interests following the initial lock-up period of 5 years based on a predetermined formula. Subsequent to the second lock-up period, which ends 3 years subsequent to the initial lock-up period, we have a call option to acquire the remaining equity interests of BTY based on a predetermined formula. Additionally, the selling shareholders of BTY have a put option for the remaining equity interest to be acquired by Aptar based on a predetermined formula. The BTY entities are leading Chinese manufacturers of high quality, decorative metal components, metal-plastic sub-assemblies, and complete color cosmetics packaging solutions for the beauty industry. On January 1, 2020, the transaction closed for an approximate purchase price of $31 million for our 49% share. As of March 31, 2020, we paid approximately $20 million, with the remaining amount of $11 million included in Accounts payable, accrued and other liabilities. The amount is payable after certain conditions under the definitive agreement are fulfilled and is expected to be paid during the second quarter of 2020.

Kali Care

During 2017, we invested $5 million to acquire 20% of the equity interests in Kali Care, a technology company that provides digital monitoring systems for medical devices.

Desotec GmbH

During 2009, we invested €574 thousand to acquire 23% of the equity interests in Desotec GmbH, a leading manufacturer of special assembly machines for bulk processing for the pharmaceutical, beauty and home and food and beverages markets.

Healthcare, Inc.

Subsequent to the quarter end, on April 1, 2020, we invested $5 million to acquire 30% of the equity interests in Healthcare, Inc., Shanghai Sonmol Internet Technology Co., Ltd. and its subsidiary, Shanghai Sonmol Medical Equipment Co., Ltd., a pharmaceutical company that provides connected devices for asthma control.

Other investments

During August 2019, we invested an aggregate amount of $3.5 million in two preferred equity investments in sustainability companies Loop and Purecycle Technologies that are accounted for at cost less impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. There were no indications of impairment nor were there any changes from observable price changes noted in the three months ended March 31, 2020.

NOTE 19 – RESTRUCTURING INITIATIVES

In late 2017, we began a business transformation to drive profitable sales growth, increase operational excellence, enhance our approach to innovation and improve organizational effectiveness. The primary focus of the plan is the Beauty + Home segment; however, certain global general and administrative functions are also being addressed. For the three months ended March 31, 2020 and 2019, we recognized $4.8 million and $9.5 million of restructuring costs related to this plan, respectively. Using current exchange rates, we estimate total implementation costs of approximately $110 million for these initiatives, including costs that have been recognized to date. The cumulative expense incurred as of March 31, 2020 was $91.3 million. We also anticipate making capital investments related to the transformation plan of approximately $50 million, of which $40 million has been incurred to date.

As of March 31, 2020 we have recorded the following activity associated with the business transformation:

	Beginning		Net Charges for						Ending
	Reserve at		the Three Months				Interest and		Reserve at
	12/31/2019		Ended 3/31/2020		Cash Paid		FX Impact		3/31/2020
Employee severance	$	7,090	$	4,066	$	(503)	$	187	$	10,840
Professional fees and other costs		3,609		773		(3,069)		(9)		1,304
Totals	$	10,699	$	4,839	$	(3,572)	$	178	$	12,144

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NOTE 20 – SUBSEQUENT EVENTS

On April 1, 2020, the Fusion Acquisition closed for an approximate purchase price of $165 million, plus an earn-out, to acquire 100% of the membership interests. Refer to Note 17 – Acquisitions for further details on the acquisition.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS, OR AS OTHERWISE INDICATED)

RESULTS OF OPERATIONS

Three Months Ended March 31,	2020		2019
Net sales	100.0	%	100.0	%
Cost of sales (exclusive of depreciation and amortization shown below)	62.5		63.0
Selling, research & development and administrative	17.5		16.3
Depreciation and amortization	7.0		6.4
Restructuring initiatives	0.7		1.3
Operating income	12.3		13.0
Other expense	(1.5)		(0.9)
Income before income taxes	10.8		12.1
Net Income	7.7		8.5
Effective tax rate	29.2	%	30.0	%
Adjusted EBITDA margin (1)	20.0	%	20.8	%

(1) Adjusted EBITDA margins are calculated as Adjusted EBITDA divided by Reported Net Sales. See the reconciliation of non-U.S. GAAP measures starting on page 31.

SIGNIFICANT DEVELOPMENTS

During the first quarter of 2020, financial results and operations were adversely impacted by the current coronavirus (“COVID-19”) pandemic. The significance of the impacts to our segments during the first quarter of 2020 are discussed herein and include, but are not limited to, the adverse impact on sales of products to our travel and retail beauty business and on-the-go beverage customers. The extent to which the COVID-19 pandemic impacts our financial results and operations for fiscal year 2020 and going forward for all three of our business segments will depend on future developments which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of the outbreak and the international actions being taken to contain and treat it. No impairments were recorded as of March 31, 2020. While the disruption is currently expected to be temporary, there is uncertainty around the duration. Due to significant uncertainty surrounding the situation, our judgment regarding future results could change and therefore our results could be materially impacted.

As each of our segments produce dispensing systems that have been determined to be essential products by various government agencies around the world, the majority of our facilities remained operational during the first quarter of 2020. We are taking a variety of measures to ensure the availability and functioning of our critical infrastructure, to promote the safety and security of our employees and to support the communities in which we operate. These measures include requiring remote working arrangements for employees where practicable. We are following public and private sector policies and initiatives to reduce the transmission of COVID-19, such as the imposition of travel restrictions, the promotion of social distancing and the adoption of work-from-home arrangements, and all of these policies and initiatives could impact our operations. Due to the speed with which the situation is developing, we are not able at this time to estimate the impact of COVID-19 on our future financial results and operations, but the impact could be material for the remainder of fiscal year 2020 and could be material during any future periods affected either directly or indirectly by this pandemic. See Part II, Item 1A, “Risk Factors,” included elsewhere in this report for information on material risks associated with COVID-19.

NET SALES

We reported net sales of $721.6 million for the quarter ended March 31, 2020, which represents a 3% decrease compared to $744.5 million reported during the first quarter of 2019. The average U.S. dollar exchange rate strengthened compared to most major currencies we operate in, resulting in a negative currency translation impact of 2%. The acquisitions of Gateway, Nanopharm and Noble positively impacted sales by 1%. Therefore, core sales, which exclude acquisitions and changes in foreign currency rates, decreased by 2% in the first quarter of 2020 compared to the same period in 2019. During the first quarter of 2020, our consolidated core sales were negatively impacted by the COVID-19 pandemic, especially within our Beauty + Home segment. Beauty sales within this segment were significantly impacted by the loss of travel and retail sales during the first quarter 2020. Our Food + Beverage segment also realized lower core sales due to the negative impact of COVID-19, especially on our single-serving beverage product sales along with a significant decline in the resin price pass-through to our customers during the quarter. Our Pharma segment realized strong core sales growth during the first quarter of 2020 as all four of our divisions posted improved results compared to the same prior year period.

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Three Months Ended March 31, 2020	Beauty				Food +
Net Sales Change over Prior Year	+ Home		Pharma		Beverage		Total
Core Sales Growth	(9)	%	7	%	(2)	%	(2)	%
Acquisitions	—	%	4	%	—	%	1	%
Currency Effects (1)	(3)	%	(2)	%	(2)	%	(2)	%
Total Reported Net Sales Growth	(12)	%	9	%	(4)	%	(3)	%

(1) Currency effects are calculated by translating last year’s amounts at this year’s foreign exchange rates.

The following table sets forth, for the periods indicated, net sales by geographic location:

Three Months Ended March 31,	2020		% of Total	2019		% of Total
Domestic	$	230,400	32%	$	213,871	29%
Europe		405,849	56%		431,368	58%
Latin America		50,794	7%		58,182	8%
Asia		34,510	5%		41,039	5%

For further discussion on net sales by reporting segment, please refer to the analysis of segment net sales and segment Adjusted EBITDA on the following pages.

COST OF SALES (EXCLUSIVE OF DEPRECIATION AND AMORTIZATION SHOWN BELOW)

Cost of sales (“COS”) as a percent of net sales decreased to 62.5% in the first quarter of 2020 compared to 63.0% in the first quarter of 2019. Our COS percentage was positively impacted by our mix of business and lower material costs. The mix of business positively impacted results as we reported sales growth of our higher margin Pharma products compared to sales declines in the other two segments. We also realized approximately $5.2 million in lower raw material input costs during the quarter as both resin and metal prices declined compared to the prior year. We did experience some additional costs and temporary disruptions to our manufacturing capacities during the first quarter of 2020 related to the COVID-19 pandemic. For example, we declared a special bonus payment to certain employees who worked to maintain supply to our customers and keep our facilities running, which increased our COS percentage by approximately 0.4% during the first quarter of 2020.  

SELLING, RESEARCH & DEVELOPMENT AND ADMINISTRATIVE

Selling, research & development and administrative expenses (“SG&A”) increased by approximately $5.0 million to $126.2 million in the first quarter of 2020 compared to $121.2 million during the same period in 2019. Excluding changes in foreign currency rates, SG&A increased by approximately $7.6 million in the quarter. The increase is partly due to $2.8 million of incremental operational costs during the first quarter of 2020 related to our acquired companies. We also recognized increases in professional fees and higher personnel costs, including $2.7 million in stock-based compensation, in accordance with our growth strategy. SG&A as a percentage of net sales increased to 17.5% compared to 16.3% in the same period of the prior year due to the cost increases mentioned above.

DEPRECIATION AND AMORTIZATION

Reported depreciation and amortization expenses increased by approximately $3.3 million to $50.8 million in the first quarter of 2020 compared to $47.5 million during the same period a year ago. Excluding changes in foreign currency rates, depreciation and amortization increased by approximately $4.4 million in the quarter compared to the same period in 2019. This increase is partly due to $2.0 million of incremental costs related to our acquisitions. We also increased our capital spending during the first quarter and the prior year to support our growth strategy. Depreciation and amortization as a percentage of net sales increased to 7.0% in the first quarter of 2020 compared to 6.4% in the same period of the prior year primarily due to the incremental increase in expenses noted above.

RESTRUCTURING INITIATIVES

In late 2017, we began a business transformation to drive profitable sales growth, increase operational excellence, enhance our approach to innovation and improve organizational effectiveness. The primary focus of the plan is the Beauty + Home segment; however, certain global general and administrative functions are also being addressed. Restructuring costs related to this plan for the three months ended March 31, 2020 and 2019 are as follows:

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Three Months Ended March 31,	2020		2019
Restructuring Initiatives by Segment
Beauty + Home	$	4,907	$	8,269
Pharma		(31)		326
Food + Beverage		103		510
Corporate & Other		(140)		425
Total Restructuring Initiatives	$	4,839	$	9,530

We estimate total implementation costs of approximately $110 million, including costs that have been recognized to date. We also anticipate making capital investments related to the business transformation of approximately $50 million, of which $40 million has been incurred to date. Based on our ongoing restructuring initiatives, we are progressing towards our initial target of $80 million annualized incremental EBITDA by the end of 2020, principally within the Beauty + Home segment. However, in addition to impacts of COVID-19, ongoing changes in customer and vendor negotiations, material indices, macro-economic trends and other factors represent continuing headwinds to the Beauty + Home segment, and have offset the consolidated net benefits from these initiatives.  

OPERATING INCOME

Operating income decreased approximately $8.6 million in the first quarter of 2020 compared to the same period a year ago. Excluding changes in foreign currency rates, operating income decreased by approximately $6.2 million in the quarter compared to the same period a year ago. Operating income as a percentage of net sales declined to 12.3% in the first quarter of 2020 compared to 13.0% in the prior year mainly due to the increases in SG&A and depreciation and amortization when compared to a lower sales base as discussed above. These cost increases are partially offset by our lower COS percentage and the reduction in restructuring costs during the first quarter of 2020 compared to the prior year.

NET OTHER EXPENSE

Net other expense in the first quarter of 2020 increased $3.3 million to $10.4 million from $7.1 million in the same period of the prior year. Miscellaneous expenses increased by approximately $1.9 million in part due to the high costs to hedge certain Latin American and Asian currencies. We also experienced higher pension costs due to the decline in discount rates in 2020 compared to 2019.

EFFECTIVE TAX RATE

The tax provision for interim periods is determined using the estimated annual effective consolidated tax rate, based on the current estimate of full-year earnings and related estimated full year-taxes, adjusted for the impact of discrete quarterly items. The effective tax rate for the three months ended March 31, 2020 and 2019 was 29.2% and 30.0%, respectively. The decrease in the effective tax rate for the three months ended March 31, 2020 was primarily due to a larger tax benefit from employee share-based compensation offset in part by a mix of other discrete items.

NET INCOME ATTRIBUTABLE TO APTARGROUP, INC.

We reported net income attributable to AptarGroup of $55.3 million in the three months ended March 31, 2020, compared to $63.0 million for the same period in the prior year.

BEAUTY + HOME SEGMENT

Operations that sell dispensing systems and sealing solutions to the personal care, beauty and home care markets form the Beauty + Home segment.

Three Months Ended March 31,	2020		2019
Net Sales	$	324,560	$	367,659
Adjusted EBITDA (1)		34,247		53,191
Adjusted EBITDA margin (1)		10.6%		14.5%

(1) Adjusted EBITDA is calculated as earnings before net interest, taxes, depreciation, amortization, unallocated corporate expenses, restructuring and acquisition-related costs. Adjusted EBITDA margins are calculated as Adjusted EBITDA divided by Reported Net Sales. See the reconciliation of non-U.S. GAAP measures starting on page 31.

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Reported sales for the quarter ended March 31, 2020 decreased 12% to $324.6 million compared to $367.7 million in the first quarter of the prior year. Changes in currency rates negatively impacted net sales by 3%. Therefore, core sales decreased 9% in the first quarter of 2020 compared to the same quarter of the prior year. The COVID-19 pandemic negatively impacted core sales during the first quarter of 2020. Core sales of our products to the beauty market decreased 13% as we experienced reduced orders from customers providing prestige beauty products, mainly in the travel retail and standard retail settings. Many beauty stores began closing toward the end of the quarter in response to government shelter in place regulations. Core sales to the personal care and home care markets decreased 5% and 6%, respectively. Increased demand for our dispensing solutions for hand sanitizers and cleaners was not enough to offset declines in other personal care and home care categories such as sun care and hair care applications, which were also negatively impacted by travel restrictions and shelter in place regulations.

Three Months Ended March 31, 2020	Personal				Home
Net Sales Change over Prior Year	Care		Beauty		Care		Total
Core Sales Growth	(5)	%	(13)	%	(6)	%	(9)	%
Currency Effects (1)	(2)	%	(3)	%	(2)	%	(3)	%
Total Reported Net Sales Growth	(7)	%	(16)	%	(8)	%	(12)	%

(1) Currency effects are calculated by translating last year’s amounts at this year’s foreign exchange rates.

Adjusted EBITDA in the first quarter of 2020 decreased 36% to $34.2 million compared to $53.2 million in the same period in the prior year. As discussed above, the COVID-19 pandemic affected our profitability as sales were impacted by travel restrictions and government shelter in place regulations. Our profitability was further impacted by special bonus payments to certain employees who worked to maintain supply to our customers and keep our facilities running as well as lower overhead absorption due to fluctuations in demand primarily in our facilities that manufacture beauty products. During the first quarter of 2020, we experienced a favorable impact of approximately $1.4 million due to lower raw material input costs, however this was not enough to offset the general economic uncertainties which has led to lower sales to our customers across our markets.

PHARMA SEGMENT

Operations that sell drug delivery, sealing and active packaging solutions primarily to the prescription drug, consumer health care, injectables and active packaging markets form the Pharma segment.

Three Months Ended March 31,	2020		2019
Net Sales	$	297,196	$	272,701
Adjusted EBITDA (1)		108,342		97,357
Adjusted EBITDA margin (1)		36.5%		35.7%

(1) Adjusted EBITDA is calculated as earnings before net interest, taxes, depreciation, amortization, unallocated corporate expenses, restructuring and acquisition-related costs. Adjusted EBITDA margins are calculated as Adjusted EBITDA divided by Reported Net Sales. See the reconciliation of non-U.S. GAAP measures starting on page 31.

Net sales for the Pharma segment increased 9% in the first quarter of 2020 to $297.2 million compared to $272.7 million in the first quarter of 2019. Changes in currencies negatively affected net sales by 2% while our acquisitions of Gateway, Nanopharm and Noble positively impacted sales by 4% in the first quarter of 2020. Therefore, core sales increased by 7% in the first quarter of 2020 compared to the first quarter of 2019. Our Pharma segment had another good quarter with core sales growth across each end market with particularly strong growth in our injectables and active packaging businesses. As these two markets are currently smaller than our prescription and consumer health care markets, there is a smaller impact on the overall segment growth. The segment was not significantly impacted by the COVID-19 pandemic during the first quarter of 2020. Core sales to the prescription drug market increased 2%, mainly on continued growth in sales of our allergic rhinitis products. Core sales to the consumer health care market also increased 2% as increased demand for our products used on nasal decongestant and eye care treatments more than compensated for some softness in demand for our nasal saline products. Injectables core sales grew 21% on increased demand across a variety of components while active packaging core sales improved 26% primarily due to our new Activ Blister packaging for the launch of an oral HIV preventative drug.

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Three Months Ended March 31, 2020	Prescription		Consumer				Active
Net Sales Change over Prior Year	Drug		Health Care		Injectables		Packaging		Total
Core Sales Growth	2	%	2	%	21	%	26	%	7	%
Acquisitions	1	%	—	%	19	%	—	%	4	%
Currency Effects (1)	(2)	%	(1)	%	(3)	%	(1)	%	(2)	%
Total Reported Net Sales Growth	1	%	1	%	37	%	25	%	9	%

(1) Currency effects are calculated by translating last year’s amounts at this year’s foreign exchange rates.

Adjusted EBITDA in the first quarter of 2020 increased 11% to $108.3 million compared to $97.4 million reported in the same period of the prior year. The strong product sales growth discussed above along with incremental profit related to our acquisitions led to the increase in reported results for the first quarter of 2020 compared to the first quarter of 2019. While we didn’t experience a significant impact from COVID-19 on our Pharma segment sales, we did recognize the special bonus payments discussed above which negatively impacted our adjusted EBITDA during the first quarter of 2020.

FOOD + BEVERAGE SEGMENT

Operations that sell dispensing systems and sealing solutions to the food and beverage markets form the Food + Beverage segment.

Three Months Ended March 31,	2020		2019
Net Sales	$	99,797	$	104,100
Adjusted EBITDA (1)		15,407		16,691
Adjusted EBITDA margin (1)		15.4%		16.0%

(1) Adjusted EBITDA is calculated as earnings before net interest, taxes, depreciation, amortization, unallocated corporate expenses, restructuring and acquisition-related costs. Adjusted EBITDA margins are calculated as Adjusted EBITDA divided by Reported Net Sales. See the reconciliation of non-U.S. GAAP measures starting on page 31.

Net sales for the quarter ended March 31, 2020 decreased approximately 4% to $99.8 million compared to $104.1 million in the first quarter of the prior year. Foreign currency rates had an unfavorable impact of 2% on total segment sales. Therefore, core sales decreased by 2% in the first quarter of 2020 compared to the first quarter of 2019. This decrease is due to the passing on of lower resin costs to our customers as well as lower single-serving beverage closure sales which appears to be related to the COVID-19 crisis. For the food market, we realized increased sales of our products used on dairy and spreads applications. For the beverage market, increased demand for our bottled water products was not enough to offset a decline in sales of our on-the-go functional drink products that were significantly affected by COVID-19 impacts.

Three Months Ended March 31, 2020
Net Sales Change over Prior Year	Food		Beverage		Total
Core Sales Growth	2	%	(13)	%	(2)	%
Currency Effects (1)	(1)	%	(2)	%	(2)	%
Total Reported Net Sales Growth	1	%	(15)	%	(4)	%

(1) Currency effects are calculated by translating last year’s amounts at this year’s foreign exchange rates.

Adjusted EBITDA in the first quarter of 2020 decreased 8% to $15.4 million compared to $16.7 million reported in the same period of the prior year. The COVID-19 impacts discussed above, along with special bonus payments to certain employees who worked to maintain supply to our customers and keep our facilities running, more than offset the benefits we received from lower resin input costs and other operational improvements realized during the first quarter of 2020.

CORPORATE & OTHER

In addition to our three reporting segments, we assign certain costs to “Corporate & Other,” which is presented separately in Note 16 – Segment Information to the Notes to the Condensed Consolidated Financial Statements. For Corporate & Other, Adjusted EBITDA (which excludes net interest, taxes, depreciation, amortization, restructuring and acquisition-related costs) primarily includes certain professional fees, compensation and information system costs which are not allocated directly to our reporting segments. For the quarter ended March 31, 2020, Corporate & Other expenses increased to $13.8 million from $12.8 million in the first quarter of 2019. This increase is mainly due to higher stock-compensation expense, professional fees and other personnel costs as we continue to implement our growth strategy.

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NON-U.S. GAAP MEASURES

In addition to the information presented herein that conforms to U.S. GAAP, we also present financial information that does not conform to U.S. GAAP, which are referred to as non-U.S. GAAP financial measures. Management may assess our financial results both on a U.S. GAAP basis and on a non-U.S. GAAP basis. We believe it is useful to present these non-U.S. GAAP financial measures because they allow for a better period over period comparison of operating results by removing the impact of items that, in management’s view, do not reflect our core operating performance. These non-U.S. GAAP financial measures should not be considered in isolation or as a substitute for U.S. GAAP financial results, but should be read in conjunction with the unaudited Condensed Consolidated Statements of Income and other information presented herein. Investors are cautioned against placing undue reliance on these non-U.S. GAAP measures. Further, investors are urged to review and consider carefully the adjustments made by management to the most directly comparable U.S. GAAP financial measure to arrive at these non-U.S. GAAP financial measures.

In our Management’s Discussion and Analysis, we exclude the impact of foreign currency translation when presenting net sales information, which we define as “constant currency.” Changes in net sales excluding the impact of foreign currency translation is a non-U.S. GAAP financial measure. As a worldwide business, it is important that we take into account the effects of foreign currency translation when we view our results and plan our strategies. Consequently, when our management looks at our financial results to measure the core performance of our business, we may exclude the impact of foreign currency translation by translating our prior period results at current period foreign currency exchange rates. As a result, our management believes that these presentations are useful internally and may be useful to investors. We also exclude the impact of material acquisitions when comparing results to prior periods. Changes in operating results excluding the impact of acquisitions are non-U.S. GAAP financial measures. We believe it is important to exclude the impact of acquisitions on period over period results in order to evaluate performance on a more comparable basis.

We present adjusted earnings before net interest and taxes (“Adjusted EBIT”) and consolidated adjusted earnings before net interest, taxes, depreciation and amortization (“Adjusted EBITDA”), both of which exclude the business transformation charges (restructuring initiatives), acquisition-related costs and purchase accounting adjustments related to acquisitions and investments. Our “Outlook” discussion below is also provided on a non-U.S. GAAP basis because certain reconciling items are dependent on future events that either cannot be controlled, such as exchange rates, or reliably predicted because they are not part of our routine activities, such as restructuring and acquisition-related costs.

We provide a reconciliation of Net Debt to Net Capital as a non-U.S. GAAP measure. “Net Debt” is calculated as interest bearing debt less cash and equivalents and short-term investments while “Net Capital” is calculated as stockholders’ equity plus Net Debt. Net Debt to Net Capital measures a company’s financial leverage, which gives users an idea of a company's financial structure, or how it is financing its operations, along with insight into its financial strength. We believe that it is meaningful to take into consideration the balance of our cash and equivalents, and short-term investments when evaluating our leverage. If needed, such assets could be used to reduce our gross debt position.

Finally, we provide a reconciliation of free cash flow as a non-U.S. GAAP measure. Free cash flow is calculated as cash provided by operating activities less capital expenditures. We use free cash flow to measure cash flow generated by operations that is available for dividends, share repurchases, acquisitions and debt repayment. We believe that it is meaningful to investors in evaluating our financial performance and measuring our ability to generate cash internally to fund our initiatives.

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	Three Months Ended
	March 31, 2020
	Consolidated		Beauty + Home		Pharma		Food + Beverage		Corporate & Other		Net Interest
Net Sales	$	721,553	$	324,560	$	297,196	$	99,797	$	-	$	-
Reported net income	$	55,250
Reported income taxes		22,786
Reported income before income taxes		78,036		7,108		89,854		5,962		(16,675)		(8,213)
Adjustments:
Restructuring initiatives		4,839		4,907		(31)		103		(140)
Transaction costs related to acquisitions		1,384		1,384
Purchase accounting adjustments related to acquisitions and investments		1,390		262		1,128
Adjusted earnings before income taxes		85,649		13,661		90,951		6,065		(16,815)		(8,213)
Interest expense		8,388										8,388
Interest income		(175)										(175)
Adjusted earnings before net interest and taxes (Adjusted EBIT)		93,862		13,661		90,951		6,065		(16,815)		-
Depreciation and amortization		50,806		20,586		17,891		9,342		2,987		-
Purchase accounting adjustments included in Depreciation and amortization above		(500)				(500)
Adjusted earnings before net interest, taxes, depreciation and amortization (Adjusted EBITDA)	$	144,168	$	34,247	$	108,342	$	15,407	$	(13,828)	$	-
Adjusted EBITDA margins (Adjusted EBITDA / Reported Net Sales)		20.0%		10.6%		36.5%		15.4%

	Three Months Ended
	March 31, 2019
	Consolidated		Beauty + Home		Pharma		Food + Beverage		Corporate & Other		Net Interest
Net Sales	$	744,460	$	367,659	$	272,701	$	104,100	$	-	$	-
Reported net income	$	62,999
Reported income taxes		27,000
Reported income before income taxes		89,999		24,181		81,258		7,716		(15,690)		(7,466)
Adjustments:
Restructuring initiatives		9,530		8,269		326		510		425
Adjusted earnings before income taxes		99,529		32,450		81,584		8,226		(15,265)		(7,466)
Interest expense		9,214										9,214
Interest income		(1,748)										(1,748)
Adjusted earnings before net interest and taxes (Adjusted EBIT)		106,995		32,450		81,584		8,226		(15,265)		-
Depreciation and amortization		47,489		20,741		15,773		8,465		2,510		-
Adjusted earnings before net interest, taxes, depreciation and amortization (Adjusted EBITDA)	$	154,484	$	53,191	$	97,357	$	16,691	$	(12,755)	$	-
Adjusted EBITDA margins (Adjusted EBITDA / Reported Net Sales)		20.8%		14.5%		35.7%		16.0%

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Net Debt to Net Capital Reconciliation		March 31,		December 31,
		2020		2019
Notes payable, revolving credit facility and overdrafts	$	220,511	$	44,259
Current maturities of long-term obligations, net of unamortized debt issuance costs		65,049		65,988
Long-Term Obligations, net of unamortized debt issuance costs		1,075,745		1,085,453
Total Debt		1,361,305		1,195,700
Less:
Cash and equivalents		410,840		241,970
Net Debt	$	950,465	$	953,730
Total Stockholders' Equity	$	1,587,623	$	1,572,252
Net Debt		950,465		953,730
Net Capital	$	2,538,088	$	2,525,982
Net Debt to Net Capital		37.4%		37.8%

Free Cash Flow Reconciliation		March 31,		March 31,
		2020		2019
Net Cash Provided by Operations	$	85,033	$	77,636
Less:
Capital Expenditures		61,625		51,742
Free Cash Flow	$	23,408	$	25,894

FOREIGN CURRENCY

Because of our international presence, movements in exchange rates may have a significant impact on the translation of the financial statements of our foreign subsidiaries. Our primary foreign exchange exposure is to the euro, but we also have foreign exchange exposure to the Chinese yuan, Brazilian real, Mexican peso, Swiss franc and other Asian, European and South American currencies. A strengthening U.S. dollar relative to foreign currencies has a dilutive translation effect on our financial statements. Conversely, a weakening U.S. dollar has an additive effect. In some cases, we sell products denominated in a currency different from the currency in which the related costs are incurred. We manage our exposures to foreign exchange principally with forward exchange contracts to economically hedge recorded transactions and firm purchase and sales commitments denominated in foreign currencies. Changes in exchange rates on such inter-country sales could materially impact our results of operations. During the first quarter of 2020 the U.S. dollar strengthened compared to the euro and other currencies in Latin America and Asia. This resulted in a dilutive impact on our translated results during the first quarter of 2020 when compared to the first quarter of 2019.

QUARTERLY TRENDS

Our results of operations in the last quarter of the year typically are negatively impacted by customer plant shutdowns in December. In addition to the impacts of COVID-19, our results of operations in a quarterly period could be impacted by factors such as the seasonality of certain products within our segments, changes in foreign currency rates, changes in product mix, changes in material costs, changes in growth rates in the markets to which our products are sold and changes in general economic conditions in any of the countries in which we do business.

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LIQUIDITY AND CAPITAL RESOURCES

Given the diversification of our segments, we believe we are in a strong financial position and have the financial resources to meet our business requirements in the foreseeable future. Our Pharma segment provided strong operating cash flows to balance out the temporary softness in some of our Beauty + Home and Food + Beverage markets during the first quarter of 2020. Our primary uses of liquidity are to invest in equipment and facilities that are necessary to support our growth, cost efficiencies and to make acquisitions that will contribute to the achievement of our strategic objectives. Amid the COVID-19 pandemic, we are focused on preserving our liquidity and therefore we have temporarily suspended repurchasing shares of our common stock and contributions to our defined benefit plans. However, we intend to continue to pay quarterly dividends to our stockholders, invest in our business and make acquisitions, as considered necessary to achieve our strategic objectives. In the event that customer demand would decrease significantly for a prolonged period of time due to the COVID-19 pandemic and adversely impact our cash flow from operations, we would have the ability to restrict and significantly reduce capital expenditure levels as well as evaluate our acquisition strategy. A prolonged and significant reduction in capital expenditure levels could increase future repairs and maintenance costs as well as have a negative impact on operating margins if we were unable to invest in new innovative products.

Cash and equivalents increased to $414.8 million at March 31, 2020 from $247.0 million at December 31, 2019. Total short and long-term interest bearing debt of $1.4 billion at March 31, 2020 increased from $1.2 billion at December 31, 2019 resulting from $175.0 million in net proceeds from our group credit facility during the first quarter of 2020 the majority of which was utilized to fund the second quarter Fusion acquisition. The ratio of our Net Debt (interest bearing debt less cash and equivalents) to Net Capital (stockholders’ equity plus Net Debt) decreased to 37.4% at March 31, 2010 compared to 37.8% at December 31, 2019. See the reconciliation of non-U.S. GAAP measures starting on page 31.

In the first three months of 2020, our operations provided approximately $85.0 million in net cash flow compared to $77.6 million for the same period a year ago. In both periods, cash flow from operations was primarily derived from earnings before depreciation and amortization. The increase in cash provided by operations during the first three months of 2020 is primarily attributable to the lower restructuring costs and better working capital management.

We used $88.1 million in cash for investing activities during the first three months of 2020 compared to $39.1 million during the same period a year ago. Our investment in capital projects increased $9.9 million during the first three months of 2020 compared to the first three months of 2019, as projects in progress at year end were paid during the first quarter of 2020. During the first three months of 2020, we invested $20.4 million in our 49% equity interest of BTY, which is accounted for as an equity method investment. Additionally, we released $1.0 million relating to the working capital escrow settlement and paid an additional $463 thousand as a working capital payment related to our acquisition of Noble. Our 2020 estimated cash outlays for capital expenditures are expected to be in the range of approximately $220 to $240 million but could vary due to changes in exchange rates as well as the timing of capital projects.

Financing activities provided $174.3 million in cash during the first three months of 2020 compared to $90.8 million in cash used by financing activities during the same period a year ago. During the first three months of 2020, we received net proceeds from our U.S. short term credit facility of $175.0 million and stock option exercises of $18.6 million. We used cash on hand to pay $23.0 million of dividends and repayments of $4.4 million related to our outstanding debt obligations.

We hold U.S. dollar and euro-denominated debt to align our capital structure with our earnings base. We also maintain a multi-currency revolving credit facility with two tranches, providing for unsecured financing of up to $300 million that is available in the U.S. and up to €150 million that is available to our wholly-owned UK subsidiary. Each borrowing under the credit facility will bear interest at rates based on LIBOR, prime rates or other similar rates, in each case plus an applicable margin. A facility fee on the total amount of the facility is also payable quarterly, regardless of usage. The applicable margins for borrowings under the credit facility and the facility fee percentage may change from time to time depending on changes in our consolidated leverage ratio. $200.0 million was utilized under our U.S. facility and no balance was utilized under our euro-based revolving credit facility as of March 31, 2020. The $25.0 million balance at December 31, 2019 under our U.S. credit facility was repaid during the first quarter of 2020. Credit facility balances are included in notes payable, including revolving credit facilities on the Condensed Consolidated Balance Sheets.

Our revolving credit facility and corporate long-term obligations require us to satisfy certain financial and other covenants including:

	Requirement	Level at March 31, 2020
Consolidated Leverage Ratio (1)	Maximum of 3.50 to 1.00	1.73 to 1.00
Consolidated Interest Coverage Ratio (1)	Minimum of 3.00 to 1.00	16.32 to 1.00

(1) Definitions of ratios are included as part of the revolving credit facility agreement and the note purchase agreements.

Based upon the above consolidated leverage ratio covenant, we have the ability to borrow approximately an additional $1.0 billion before the 3.50 to 1.00 maximum ratio requirement is exceeded.

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Our foreign operations have historically met cash requirements with the use of internally generated cash or uncommitted short-term borrowings. We also have committed financing arrangements in both the U.S. and UK as detailed above. We manage our global cash requirements considering (i) available funds among the many subsidiaries through which we conduct business, (ii) the geographic location of our liquidity needs, and (iii) the cost to access international cash balances.

On April 15, 2020, the Board of Directors declared a quarterly cash dividend of $0.36 per share payable on May 20, 2020 to stockholders of record as of April 29, 2020.

CONTINGENCIES

The Company, in the normal course of business, is subject to a number of lawsuits and claims both actual and potential in nature. Please refer to Note 12 - Commitments and Contingencies of the Notes to Condensed Consolidated Financial Statements for a discussion of contingencies affecting our business.

OFF-BALANCE SHEET ARRANGEMENTS

We lease certain warehouse, plant and office facilities as well as certain equipment under noncancelable operating leases. Most of the operating leases contain renewal options and certain equipment leases include options to purchase during or at the end of the lease term. As a result of the adoption of ASU 2016-02 and subsequent amendments, which requires organizations to recognize leases on the balance sheet, we do not have significant off-balance sheet arrangements. Please refer to Note 7 – Leases of the Notes to Condensed Consolidated Financial Statements.

RECENTLY ISSUED ACCOUNTING STANDARDS

We have reviewed the recently issued accounting standards updates to the FASB’s Accounting Standards Codification that have future effective dates. Standards that are effective for 2020 are discussed in Note 1 – Summary of Significant Accounting Policies of the Notes to Condensed Consolidated Financial Statements.

In August 2018, the FASB issued ASU 2018-14, which amends disclosure requirements for defined benefit pension and other postretirement plans. The amendments in this update remove disclosures that are no longer considered cost beneficial, clarify the specific requirements of disclosures, and add disclosure requirements identified as relevant. The new standard is effective for fiscal years ending after December 15, 2020. As this update amends disclosure requirements, we do not expect any significant impact around adopting this guidance.

Other accounting standards that have been issued by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on our Condensed Consolidated Financial Statements upon adoption.

OUTLOOK

Factors that could impact our second quarter results, include among other things, the duration and severity of the COVID-19 pandemic, the pace and scope of reopening in regions that are currently under government confinement orders, the speed at which beauty and other retail stores open, the willingness of consumers to participate in those shopping channels, the rate at which airline travel will resume and the general level of on-the-go consumption particularly with certain beverage products.

Aptar expects the near-term effects related to the COVID-19 pandemic to continue through the second quarter and anticipates that they will be more pronounced than the Company experienced in the first quarter. The results of Aptar’s Beauty + Home segment are expected to be significantly impacted by continued softness across each end market primarily related to the effects of COVID-19. In addition, the Food + Beverage segment, which had very strong growth in the prior year second quarter, is expected to see continued softness in the on-the-go beverage market primarily related to COVID-19 and the impact from passing on lower resin costs. Aptar’s Pharma segment is facing difficult comparisons compared to the prior year’s exceptional growth, especially within its prescription division. Aptar’s second quarter results are expected to include expenses of approximately $3.6 million (pretax) related to the Thank You Award being given to employees who have made it possible for Aptar to continue to supply critical infrastructure industries during the COVID-19 crisis.  

We expect earnings per share for the second quarter of 2020, excluding any restructuring expenses and acquisition-related costs, to be in the range of $0.58 to $0.73 and this guidance is based on an effective tax rate range of 31% to 33%.

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FORWARD-LOOKING STATEMENTS

Certain statements in Management’s Discussion and Analysis and other sections of this Form 10-Q are forward-looking and involve a number of risks and uncertainties, including certain statements set forth in the Significant Developments, Restructuring Initiatives, Quarterly Trends, Liquidity and Capital Resources, Contingencies and Outlook sections of this Form 10-Q. Words such as “expects,” “anticipates,” “believes,” “estimates,” “future,” “potential” and other similar expressions or future or conditional verbs such as “will,” “should,” “would” and “could” are intended to identify such 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 (the “Exchange Act”) and are based on our beliefs as well as assumptions made by and information currently available to us. Accordingly, our 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 in our operations and business environment including, but not limited to:

● outbreaks of pandemics, including the impact of COVID-19 on our global supply chain and our global customers and operations, which has elevated and may or will continue to elevate many of the risks and uncertainties discussed below;

● economic conditions worldwide, including potential deflationary or inflationary conditions in regions we rely on for growth;

● political conditions worldwide, including the impact of the UK leaving the European Union (Brexit) on our UK operations;

● significant fluctuations in foreign currency exchange rates or our effective tax rate;

● the impact of tax reform legislation, changes in tax rates and other tax-related events or transactions that could impact our effective tax rate;

● financial conditions of customers and suppliers;

● consolidations within our customer or supplier bases;

● changes in customer and/or consumer spending levels;

● loss of one or more key accounts;

● the availability of raw materials and components (particularly from sole sourced suppliers) as well as the financial viability of these suppliers;

● fluctuations in the cost of materials, components and other input costs (particularly resin, metal, anodization costs and transportation and energy costs);

● our ability to successfully implement facility expansions and new facility projects;

● our ability to offset inflationary impacts with cost containment, productivity initiatives or price increases;

● changes in capital availability or cost, including interest rate fluctuations;

● volatility of global credit markets;

● our ability to identify potential new acquisitions and to successfully acquire and integrate such operations and products, including the successful integration of the businesses we have acquired, including contingent consideration valuation;

● direct or indirect consequences of acts of war, terrorism or social unrest;

● cybersecurity threats that could impact our networks and reporting systems;

● the impact of natural disasters and other weather-related occurrences;

● fiscal and monetary policies and other regulations;

● changes or difficulties in complying with government regulation;

● changing regulations or market conditions regarding environmental sustainability;

● work stoppages due to labor disputes;

● competition, including technological advances;

● our ability to protect and defend our intellectual property rights, as well as litigation involving intellectual property rights;

● the outcome of any legal proceeding that has been or may be instituted against us and others;

● our ability to meet future cash flow estimates to support our goodwill impairment testing;

● the demand for existing and new products;

● the success of our customers’ products, particularly in the pharmaceutical industry;

● our ability to manage worldwide customer launches of complex technical products, particularly in developing markets;

● difficulties in product development and uncertainties related to the timing or outcome of product development;

● significant product liability claims;

● the execution of our business transformation plan; and

● other risks associated with our operations.

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Although we believe that our forward-looking statements are based on reasonable assumptions, there can be no assurance that actual results, performance or achievements will not differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements. We undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Please refer to Item 1A (Risk Factors) of Part I included in our Annual Report on Form 10-K for the year ended December 31, 2019 and to Item 1A (Risk Factors) of Part II of this report for additional risk factors affecting the Company.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

A significant number of our operations are located outside of the United States. Because of this, movements in exchange rates may have a significant impact on the translation of the financial condition and results of operations of our entities. Our primary foreign exchange exposure is to the euro, but we also have foreign exchange exposure to the Chinese yuan, Brazilian real, Mexican peso and Swiss franc, among other Asian, European, and South American currencies. A weakening U.S. dollar relative to foreign currencies has an additive translation effect on our financial condition and results of operations. Conversely, a strengthening U.S. dollar relative to foreign currencies has a dilutive translation effect on our financial condition and results of operations.

Additionally, in some cases, we sell products denominated in a currency different from the currency in which the related costs are incurred. Any changes in exchange rates on such inter-country sales may impact our results of operations.

We manage our exposures to foreign exchange principally with forward exchange contracts to hedge certain firm purchase and sales commitments and intercompany cash transactions denominated in foreign currencies.

The table below provides information as of March 31, 2020 about our forward currency exchange contracts. The majority of the contracts expire before the end of the second quarter of 2020.

			Average	Min / Max
		Contract Amount	Contractual	Notional
Buy/Sell		(in thousands)	Exchange Rate	Volumes
EUR / USD	$	22,646	1.1074	18,669-22,646
EUR / BRL		9,376	4.8745	9,376-11,407
CHF / EUR		6,089	0.9387	6,040-6,605
EUR / INR		3,781	79.7800	3,781-3,981
CZK / EUR		3,169	0.0384	0-3,169
EUR / MXN		2,137	21.5937	1,999-2,239
USD / EUR		2,085	0.8972	1,322-4,978
USD / CNY		2,000	7.0663	2,000-2,000
EUR / CHF		1,773	1.0587	0-1,773
MXN / USD		1,384	0.0519	557-1,384
CHF / USD		835	1.0367	0-835
GBP / EUR		718	1.1774	718-1,544
USD / CHF		130	0.9551	0-130
Total	$	56,123

As of March 31, 2020, we have recorded the fair value of foreign currency forward exchange contracts of $2.1 million in prepaid and other and $0.5 million in accounts payable and accrued liabilities on the balance sheet. We also entered into a EUR/USD floating-to-fixed cross currency swap on July 20, 2017 to effectively hedge the foreign exchange and interest rate exposure on the $280 million bank term loan drawn by our wholly-owned UK subsidiary. The fair value of this cash flow hedge is $6.8 million reported in prepaid and other on the balance sheet.

ITEM 4. CONTROLS AND PROCEDURES

DISCLOSURE CONTROLS AND PROCEDURES

Management has evaluated, with the participation of the chief executive officer and chief financial officer of the Company, the effectiveness of our disclosure controls and procedures (as that term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of March 31, 2020. Based on that evaluation, the chief executive officer and chief financial officer have concluded that these controls and procedures were effective as of such date.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

During the fiscal quarter ended March 31, 2020, we implemented enterprise resource planning (“ERP”) systems at two operating facilities. Consequently, the control environments have been modified at these locations to incorporate the controls contained within the new ERP systems. Except for the foregoing, no changes in our internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Securities Exchange Act of 1934) occurred during our fiscal quarter ended March 31, 2020 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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Amid the COVID-19 pandemic, we have implemented remote work arrangements and restricted non-essential business travel. These arrangements have not materially affected our ability to maintain our business operations, including the operation of financial reporting systems, internal control over financial reporting and disclosure controls and procedures.

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PART II - OTHER INFORMATION

ITEM 1A. RISK FACTORS

The following risk factors are in addition to the risks described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 under Item 1A, “Risk Factors” filed with the SEC pursuant to the Exchange Act. The effects of the events and circumstances described in the following risk factors have elevated and may or will continue to elevate many of the risks contained in the Company’s Form 10-K, including the risks relating to a deterioration in economic conditions in a particular region or market, our fixed costs structure, reliance on single sourced materials and manufacturing sites and potential asset impairments.

The COVID-19 pandemic is currently adversely affecting our business. Additional factors could exacerbate such negative consequences and/or cause other materially adverse effects. The COVID-19 pandemic adversely affected our sales of products to our travel and retail beauty business and on-the-go beverage customers in the quarter ended March 31, 2020 and that adverse impact has continued into the second quarter. Since the end of the quarter, economic and health conditions in the United States and across most of the globe have changed rapidly. Customer demand across all segments, particularly our Beauty + Home and Food + Beverage segments, may decrease further from historical levels depending on the duration and severity of the COVID-19 pandemic, the length of time it takes for normal economic and operating conditions to resume, additional governmental actions that may be taken and/or extensions of time for restrictions that have been imposed to date, and numerous other uncertainties. Such events may result in business and manufacturing disruption, inventory shortages due to disruptions to our supply chain and distribution channels, delivery delays, increased risk associated with customer payments and reduced sales and operations, any of which could materially affect our stock price, business prospects, financial condition, results of operations and liquidity.

The ability of our employees to work may be significantly impacted by COVID-19. The majority of our office and management personnel are working remotely and the majority of our facilities remained operational during the first quarter of 2020 as each of our segments produce dispensing systems that have been determined to be essential products by various government agencies around the world. The health and safety of our workforce is of primary concern and we may need to enact further precautionary measures to help minimize the risk of our employees being exposed to the virus. Further, our management team is focused on mitigating the adverse effects of the COVID-19 pandemic, which has required and will continue to require a large investment of time and resources across the entire company, thereby diverting their attention from other priorities that existed prior to the outbreak of the pandemic. If these conditions worsen, or last for an extended period of time, our ability to manage our business may be impaired, and operational risks, cybersecurity risks and other risks facing us even prior to the pandemic may be elevated.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

RECENT SALES OF UNREGISTERED SECURITIES

Certain French employees are eligible to participate in the FCP Aptar Savings Plan (the “Plan”). An independent agent purchases shares of common stock available under the Plan for cash on the open market and we do not issue shares. We do not receive any proceeds from the purchase of common stock under the Plan. The agent under the Plan is Banque Nationale de Paris Paribas Fund Services. No underwriters are used under the Plan. All shares are sold in reliance upon the exemption from registration under the Securities Act of 1933 provided by Regulation S promulgated under that Act. During the quarter ended March 31, 2020, the Plan purchased 10,487 shares of our common stock on behalf of the participants at an average price of $98.22, for an aggregate amount of $1.0 million. The Plan sold 12,202 shares of our common stock on behalf of the participants at an average price of $98.35, for an aggregate amount of $1.2 million during the same period. At March 31, 2020, the Plan owned 88,478 shares of our common stock.

ISSUER PURCHASES OF EQUITY SECURITIES

On April 18, 2019, we announced a share purchase authorization of up to $350 million of common stock. This authorization replaces previous authorizations and has no expiration date. We may repurchase shares through the open market, privately negotiated transactions or other programs, subject to market conditions.

During the three months ended March 31, 2020, we did not repurchase any shares. As of March 31, 2020, there was $278.5 million of authorized share repurchases available to us. Amid the COVID-19 pandemic, we are focused on preserving our liquidity and therefore we have temporarily suspended repurchasing shares of our common stock.

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ITEM 6. EXHIBITS

Exhibit 10.1	Form of AptarGroup, Inc. Restricted Stock Unit Award Agreement (Performance-Based Vesting Form) (U.S./Mexico/Argentina employee version) pursuant to the AptarGroup, Inc. 2018 Equity Incentive Plan.
Exhibit 10.2	Form of AptarGroup, Inc. Restricted Stock Unit Award Agreement (Performance-Based Vesting Form) (French employee version) pursuant to the AptarGroup, Inc. 2018 Equity Incentive Plan.
Exhibit 10.3	Form of AptarGroup, Inc. Restricted Stock Unit Award Agreement (Performance-Based Vesting Form) (All Other Employees) pursuant to the AptarGroup, Inc. 2018 Equity Incentive Plan.
Exhibit 10.4	Form of AptarGroup, Inc. Restricted Stock Unit Award Agreement (Service-Based Vesting Form) (U.S./Mexico/Argentina employee version) pursuant to the AptarGroup, Inc. 2018 Equity Incentive Plan.
Exhibit 10.5	Form of AptarGroup, Inc. Restricted Stock Unit Award Agreement (Service-Based Vesting Form) (non-French employee version) pursuant to the AptarGroup, Inc. 2018 Equity Incentive Plan.
Exhibit 10.6	Form of AptarGroup, Inc. Restricted Stock Unit Award Agreement (Service-Based Vesting Form) (French employee version) pursuant to the AptarGroup, Inc. 2018 Equity Incentive Plan.
Exhibit 31.1	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
Exhibit 31.2	Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
Exhibit 32.1	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
Exhibit 32.2	Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
Exhibit 101	The following information from our Quarterly Report on Form 10-Q for the first quarter of fiscal 2020, filed with the SEC on May 1, 2020, formatted in Inline Extensible Business Reporting Language (XBRL): (i) the Cover Page, (ii) the Condensed Consolidated Statements of Income – Three Months Ended March 31, 2020 and 2019, (iii) the Condensed Consolidated Statements of Comprehensive Income – Three Months Ended March 31, 2020 and 2019, (iv) the Condensed Consolidated Balance Sheets – March 31, 2020 and December 31, 2019, (v) the Condensed Consolidated Statements of Changes in Equity – Three Months Ended March 31, 2020 and 2019, (vi) the Condensed Consolidated Statements of Cash Flows - Three Months Ended March 31, 2020 and 2019 and (vii) the Notes to Condensed Consolidated Financial Statements.
Exhibit 104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

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SIGNATURE

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.
	(Registrant)
By	/s/ ROBERT W. KUHN
	Robert W. Kuhn
	Executive Vice President,
	Chief Financial Officer and Secretary
	(Duly Authorized Officer and
	Principal Accounting and Financial Officer)
	Date: May 1, 2020

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EX-10.1

Exhibits 10.1

U.S./Mexico/Argentina employee version

APTARGROUP, INC.

RESTRICTED STOCK UNIT AWARD AGREEMENT

(PERFORMANCE-BASED VESTING FORM)

AptarGroup, Inc., a Delaware corporation (the “Company”), hereby grants the participant (the “Employee”) as of [_____] (the “Grant Date”), pursuant to Section 6(d) of the AptarGroup, Inc. 2018 Equity Incentive Plan (the “Plan”), a restricted stock unit award (the “Award”) with respect to the number of shares of the Company’s Common Stock, par value $0.01 per share (the “Common Stock”) set forth in the Award Notice, upon and subject to the restrictions, terms and conditions set forth below.  Capitalized terms not defined herein shall have the meanings specified in the Plan.

1. Award Subject to Acceptance of Agreement.  The Award shall be null and void unless the Employee accepts this Agreement by executing the Award Notice in the space provided therefor and returning an original execution copy of the Award Notice to the Company  (or electronically accepting this Agreement within the Employee’s stock plan account with the Company’s stock plan administrator according to the procedures then in effect).

2. Performance Period and Vesting. 

2.1 Performance-Based Vesting Conditions.  Subject to the remainder of this Section 2, the shares of Common Stock shall vest pursuant to the terms of this Agreement and the Plan based on the achievement of the performance goals set forth in the Award Notice over the performance period set forth in the Award Notice (the “Performance Period”), provided that that the Employee remains in continuous employment with the Company through the end of the Performance Period (the “Vesting Date”).  Attainment of the performance goals shall be determined and certified by the Committee in writing prior to the settlement of the Award.

2.2 Termination of Employment.  

(i) Termination of Employment by Reason of Death or Disability.  If, prior to the Vesting Date, the Employee’s employment is terminated by the Company by reason of death or Disability, the Employee or the Employee’s beneficiary, as the case may be, shall be entitled to a prorated payment equal to the target number of shares of Common Stock subject to this Award multiplied by a fraction, the numerator of which shall equal the number of days such Employee was employed with the Company during the Performance Period and the denominator of which shall equal the number of days in the Performance Period.  The portion of the Award that does not become vested pursuant to this clause (i) shall be immediately forfeited.

(ii) Termination of Employment by Reason of Retirement.  If, prior to the Vesting Date, the Employee’s employment is terminated by reason of Retirement, the Employee or the Employee’s beneficiary, as the case may be, shall be entitled to a prorated payment.  Such prorated payment shall be determined in accordance with the Award Notice at the end of the Performance Period based on the actual performance during the Performance Period multiplied by a fraction, the numerator of which shall equal the number of days such Employee was employed with the Company during the Performance Period and the denominator of which shall equal the number of days in the Performance Period.  The portion of the Award that does not become vested pursuant to this clause (i) shall be immediately forfeited.

(iii) Termination of Employment for any Other Reason. If, prior to the Vesting Date, an Employee’s employment with the Company is terminated for any reason other than as set forth in Section 2.2(i) and 2.2(ii),  such Employee’s Award shall be immediately forfeited.

(iv) Change in Control.  In the event of a Change in Control prior to the Vesting Date, the Performance Period shall end as of the date on which the Change in Control is consummated (the “Change in Control Performance Period”) and the Employee shall be eligible to receive an Award determined in accordance with the Award Notice based on actual performance during the Change in Control Performance Period;  provided,  however, if the Change in Control occurs after the date on which an Employee’s employment is terminated by reason of Retirement, pursuant to Section 2.2(ii), the Employee shall be eligible to receive an Award determined in accordance with the Award Notice based on actual performance during the Change in Control Performance Period and prorated in accordance with Section 2.2(ii) based on the number of days such Employee was employed with the Company during the Performance Period.  In the event of a Change in Control prior to the Vesting Date and after the date on which the Employee’s employment with the Company terminated where the Award shall already have been forfeited pursuant to Section 2.2(i) and Section 2.2(iii), as applicable, the Employee shall not be eligible for any payment (or, in the case of Section 2.2(i), any further payment) with respect to the Award.

(v) If at any time prior to the earliest to occur of (i) the end of the Performance Period and (ii) the date which is one year after the effective date of the Employee's termination of employment for any reason other than death, the Employee:

(1) directly or indirectly (whether as principal, agent, independent contractor, partner or otherwise) engages in any type of or accepts employment with or renders services to any Competing Entity or takes any action inconsistent with the fiduciary relationship of an employee to the employee's employer; provided, that, following a termination of employment, the Employee may accept employment with a Competing Entity, the businesses of which are diversified, and which with respect to one or more of its businesses considered separately is not a Competing Entity, provided, that the Company, prior to the Employee's accepting such employment, shall receive written assurances satisfactory to the Company from such Competing Entity and from the Employee that the Employee will not render services directly or indirectly in connection with any Competing Product or be employed in a position where the Employee could use or disclose confidential information of the Company or an Affiliate or of any customer or client of the Company or an Affiliate in connection with the Employee's employment responsibilities to the benefit of a Competing Entity; or

(2) directly or indirectly induces or attempts to induce any employee, agent or customer of the Company or any Affiliate to terminate such employment, agency or business relationship, or take any action or engage in any conduct which would interfere with the employment relationship between the Company and any of its employees; or

(3) directly or indirectly, for the Employee or any Competing Entity, sells or offers for sale, or assists in any way in the sale of, Competing Products to any customer or client of the Company or any Affiliate, upon which the Employee has called or which the Employee has supervised while an employee of the Company or an Affiliate; or

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(4) directly or indirectly engages in any activity which is contrary, inimical or harmful to the interests of the Company or an Affiliate, including but not limited to (x) violations of Company policies, including the Company's insider trading and confidentiality policies and (y) disclosure or misuse of any confidential information or trade secrets of the Company or an Affiliate,

then the Award shall be automatically forfeited and cancelled by the Company on the date the Employee engages in such activity. If, at the time of enforcement of this Section 2.2(v), 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. Notwithstanding the foregoing and any other language in this Agreement, this Agreement does not supersede or preclude the enforceability of any restrictive covenant provision contained in any prior agreement entered into by Employee.  Further, no prior restrictive covenant supersedes or precludes the enforceability of any provision contained in this Agreement.

(vi) The Employee may be released from the Employee's obligations under Section 2.2(v) only if and to the extent the Committee determines in its sole discretion that such a release is in the best interests of the Company.

(vi) Definitions.  For purposes of this Agreement, the following terms shall be defined as follows:

(1) “Cause” shall mean (i) the commission of a felony involving moral turpitude, (ii) the commission of a fraud, (iii) the commission of any material 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) the willful and continued failure by the Employee to substantially perform the Employee’s duties with the Company (other than any such failure resulting from the Employee’s incapacity due to physical or mental illness) after a written demand for substantial performance is delivered to the Employee by the Company, which demand specifically identifies the manner in which the Company believes that the Employee has not substantially performed the Employee’s duties, (vi) breach of any restrictive covenant provision or agreement with the Company or (vii) any breach by the Employee of any written agreement with the Company or any of its subsidiaries or affiliates which is material and which is not cured within 30 days following written notice thereof to the Employee by the Company.

(1) “Competing Entity” shall mean any business entity, regardless of its form (e.g. corporations, partnerships, sole proprietorships, trusts and joint ventures), which is engaged in, or is about to become engaged in, research or development, production, marketing or selling of any Competing Product anywhere worldwide which the Company or its Affiliates is engaged in business.

(1) “Competing Product” shall mean any product, technology or process of any person or organization other than the Company, in existence or under development, which is of the same type or intended for the same use as, or which competes or is potentially competitive with, a product, technology or process of the Company.

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(1) “Disability” shall mean that the Employee either (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or (ii) by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, is receiving income replacement benefits for a period of not less than six (6) months under an accident and health plan covering employees of the Employee’s employer.

(1) “Retirement”  shall mean termination of employment, other than for Cause, either (i) at or after age 55 after a minimum of (a) ten (10) years of employment with the Company, or (b) ten (10) years of employment with the Company after applying five (5) years of credit for previous work experience in accordance with Company policy or (ii) at or after age 65.  For purposes of determining whether Employee has satisfied the service requirement for Retirement, employment with an entity or business acquired by the Company shall be deemed to be employment with the Company. 

3. Conversion of Restricted Stock Units and Issuance of Shares.  Upon the vesting of all or any portion of the Award in accordance with Section 2 hereof, one share of Common Stock shall be issuable for each restricted stock unit that vests on such date, subject to the terms and provisions of the Plan and this Agreement.  Thereafter, the Company will transfer such shares to the Employee upon satisfaction of any required tax withholding obligations.  No fractional shares shall be issued under this Agreement.

4. Rights as a Stockholder.  The Employee shall not be entitled to any privileges of ownership (including any voting rights or rights with respect to dividends paid on the Common Stock) with respect to any of the shares of Common Stock issuable under the Award unless and until, and only to the extent, the Award is settled by the issuance of such shares to the Employee.

5. Additional Terms and Conditions of Award. 

5.1 Nontransferability of Award.  During the Performance Period, the restricted stock units subject to the Award and not then vested may not be transferred by the Employee other than by will, the laws of descent and distribution or pursuant to Section 7(a) of the Plan on a beneficiary designation form approved by the Company.  Except as permitted by the foregoing, during the Performance Period, the restricted stock units subject to the Award and not then vested may not be sold, transferred, assigned, pledged, hypothecated, encumbered or otherwise disposed of (whether by operation of law or otherwise) or be subject to execution, attachment or similar process.  Any such attempted sale, transfer, assignment, pledge, hypothecation or encumbrance, or other disposition of such restricted stock units shall be null and void.

5.2 Withholding Taxes.  (a)  As a condition precedent to the delivery to the Employee of any of the shares of Common Stock subject to the Award, the Employee shall, upon request by the Company, pay to the Company (or shall cause a broker-dealer on behalf of the Employee to pay to the Company) such amount of cash as the Company may be required, under all applicable federal, state, local or other laws or regulations, to withhold and pay over as income or other withholding taxes (the “Required Tax Payments”) with respect to the Award.  If the Employee shall fail to advance the Required Tax Payments after request by the Company, the Company may, in its discretion, deduct any Required Tax Payments from any amount then or thereafter payable by the Company to the Employee.

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(b)Under the terms of this Agreement, the Employee’s obligations to pay the Required Tax Payments shall be satisfied by the Company withholding whole shares of Common Stock which would otherwise be issued or transferred to the Employee having an aggregate Market Value, determined as of the date on which such withholding obligation arises (the “Tax Date”), equal to the Required Tax Payments; provided,  however, the Employee may notify the Company prior to the Tax Date that the Employee has elected, in lieu of the Company withholding shares of Common Stock, to satisfy his or her obligation to advance the Required Tax Payments by (i) a check or cash payment to the Company, (ii) delivery to the Company (either actual delivery or by attestation procedures established by the Company) of previously owned whole shares of Common Stock having an aggregate Market Value, determined as of the Tax Date, equal to the Required Tax Payments, (iii) except as may be prohibited by applicable law, a cash payment by a broker whom the Company has selected for this purpose and to whom the Employee has authorized to sell any shares acquired upon the vesting of the Award to meet the Required Tax Payments; or (iv) any combination of share withholding and (i), (ii) and (iii).  Shares to be delivered to the Company or withheld may not have a Market Value in excess of the minimum amount of the Required Tax Payments (or such greater withholding amount to the extent permitted by applicable withholding rules and accounting rules without resulting in variable accounting treatment).  Any fraction of a share which would be required to satisfy any such obligation shall be disregarded and the remaining amount due shall be paid in cash by the Employee. 

5.3 Compliance with Applicable Law.  The Award is subject to the condition that if the listing, registration or qualification of the shares of Common Stock subject to the Award upon any securities exchange or under any law, or the consent or approval of any governmental body, or the taking of any other action is necessary or desirable as a condition of, or in connection with, the vesting of the restricted stock units or the delivery of the shares hereunder, the shares of Common  Stock subject to the Award may not be delivered, in whole or in part, unless such listing, registration, qualification, consent or approval shall have been effected or obtained, free of any conditions not acceptable to the Company.  The Company agrees to use reasonable efforts to effect or obtain any such listing, registration, qualification, consent or approval.

5.4 Issuance of Shares.  As soon as practicable after the applicable Vesting Date or, if applicable, the date of the Participant’s termination of employment due to death or Disability or the end of the Change in Control Performance Period (but no later than the March 15th occurring immediately after the Vesting Date, the date of the Participant’s termination of employment due to death or Disability or the end of the Change in Control Performance Period, as applicable), the Company shall issue or cause to be issued in the Employee’s name (or such other name as is acceptable to the Company and designated in writing by the Employee) the vested shares of Common Stock.  Such issuance shall be evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company (or, alternatively at the discretion of the Company, a certificate or certificates may be registered in the Employee’s name).  The Company shall pay all original issue or transfer taxes and all fees and expenses incident to such delivery, except as otherwise provided in Section 5.2.

5.5 Award Confers No Rights to Continued Employment.  In no event shall the granting of the Award or its acceptance by the Employee give or be deemed to give the Employee any right to continued employment by the Company or any Affiliate of the Company.

5.6 Decisions of Board or Committee.  The Board of Directors of the Company or the Committee shall have the right to resolve all questions which may arise in connection with the Award.  Any interpretation, determination or other action made or taken by the Board of Directors or the Committee regarding the Plan or this Agreement shall be final, binding and conclusive.

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5.7 Company to Reserve Shares.  The Company shall at all times prior to the cancellation of the Award reserve and keep available, either in its treasury or out of it authorized but unissued shares of Common Stock, shares of Common Stock equal to the full number of unvested restricted stock units subject to the Award from time to time.

5.8 Agreement Subject to the Plan; Section 409A of the Code.  This Agreement is subject to the provisions of the Plan (including the adjustment provision set forth in Section 7(b) thereof) and shall be interpreted in accordance therewith.  The Employee hereby acknowledges receipt of a copy of the Plan.  This Program and the Awards granted hereunder are intended to be exempt from Section 409A of the Code as short-term deferrals pursuant to U.S., Treasury Regulation §1.409A-1(b)(4), and shall be interpreted and construed accordingly. Each payment hereunder shall be considered a separate payment for purposes of Section 409A of the Code. The Company reserves the right to amend this Agreement to the extent it determines in its sole discretion such amendment is necessary or appropriate to comply with applicable law, including but not limited to Section 409A of the Code.  Notwithstanding the foregoing, under no circumstances shall the Company be responsible for any taxes, penalties, interest or other losses or expenses incurred by the Employee due to any failure to comply with Section 409A of the Code.    

6. No Interference. Nothing in this Agreement prohibits the Employee from filing a charge with, or reporting possible violations of federal law or regulation to any governmental agency or entity, including but not limited to the U.S. Equal Opportunity Commission, the Department of Justice, the Securities and Exchange Commission, Congress, and any agency Inspector General, or making other disclosures that are protected under the whistleblower provisions of federal law or regulation. The Employee does not need the prior authorization of the Company to make any such reports or disclosures and is not required to notify the Company that he has made such reports or disclosures. In addition, this Agreement does not limit the Employee's right to receive an award for information provided to any government agencies. Furthermore, nothing in this Agreement shall limit the Employee's ability (i) to disclose in confidence trade secrets to federal, state, and local government officials, or to an attorney, for the sole purpose of reporting or investigating a suspected violation of law or (ii) disclose trade secrets in a document filed in a lawsuit or other proceeding, but only if the filing is made under seal and protected from public disclosure. Nothing in this Agreement is intended to conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by 18 U.S.C. § 1833(b).

7. Clawback of Proceeds and Setoff.  

7.1 Clawback of Proceeds.  This Award is subject to the clawback provisions in Section 7(j) of the Plan. In addition, if the Employee violates Section 2.2(v) of this Agreement, then any and all Award Proceeds (as hereinafter defined) attributable to the settlement of any portion of the Award within the 24-month period immediately preceding or any time after the date of the Employee’s termination of employment or service with the Company shall be immediately due and payable by the Employee to the Company. For purposes of this Section, “Proceeds” shall mean the Market Value of a share of Common Stock on the date such portion of the Award was settled, multiplied by the number of shares of Common Stock issued to the Employee pursuant to the settlement of such portion of the Award. The remedy provided by this Section shall be in addition to and not in lieu of any rights or remedies which the Company may have against the Employee in respect of a breach by the Employee of any duty or obligation to the Company.

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7.2 Right of Setoff. The Employee agrees that by accepting the Award the Employee authorizes the Company and its affiliates to deduct, to the extent permitted by applicable law, any amount or amounts owed by the Employee pursuant to this Section 7 from any amounts payable by or on behalf of the Company or any affiliate to the Employee, including, without limitation, any amount payable to the Employee as salary, wages, vacation pay, bonus or the vesting or settlement of the Award or any stock-based award. This right of setoff shall not be an exclusive remedy and the Company’s or an affiliate’s election not to exercise this right of setoff with respect to any amount payable to the Employee shall not constitute a waiver of this right of setoff with respect to any other amount payable to the Holder or any other remedy.

8. Miscellaneous Provisions.

8.1 Meaning of Certain Terms.  As used herein, employment by the Company shall include employment by an Affiliate of the Company.

8.2 Successors.  This Agreement shall be binding upon and inure to the benefit of any successor or successors of the Company and any person or persons who shall, upon the death of the Employee, acquire any rights hereunder in accordance with this Agreement or the Plan.

8.3 Notices.  All notices, requests or other communications provided for in this Agreement shall be made in writing by (a) actual delivery to the party entitled thereto, (b) mailing to the last known address of the party entitled thereto, via certified or registered mail, return receipt requested or (c) telecopy with confirmation of receipt.  The notice, request or other communication shall be deemed to be received, in the case of actual delivery, on the date of its actual receipt by the party entitled thereto, in the case of mailing, on the tenth calendar day following the date of such mailing, and in the case of telecopy, on the date of confirmation of receipt; provided, however, that if a notice, request or other communication is not received during regular business hours, it shall be deemed to be received on the next succeeding business day of the Company.

8.4 Governing Law.  This Agreement and all determinations made and actions taken pursuant hereto, to the extent not otherwise governed by the laws of the United States, shall be governed by the laws of the State of Delaware and construed in accordance therewith without giving effect to conflicts of laws principles.

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EX-10.2

Exhibit 10.2

French employee version

APTARGROUP, INC.

RESTRICTED STOCK UNIT AWARD AGREEMENT

(PERFORMANCE-BASED VESTING FORM)

AptarGroup, Inc., a Delaware corporation (the “Company”), hereby grants the participant (the “Employee”) as of ______ (the “Grant Date”), pursuant to Section 6(d) of the AptarGroup, Inc. 2018 Equity Incentive Plan (the “Plan”) as amended by the 2018 French Sub-Plan for Restricted Stock Units (the “Sub-Plan”), a restricted stock unit award (the “Award”) with respect to the number of shares of the Company’s Common Stock, par value $0.01 per share (the “Common Stock”) set forth in the Award Notice, upon and subject to the restrictions, terms and conditions set forth below.  Capitalized terms not defined herein shall have the meanings specified in the Plan.

The Award is governed by the terms and conditions of the Plan as amended by the Sub-Plan (together the “2018 French RSU Plan”).

In the event the terms and conditions set out in this Award Agreement differ from or conflict with the terms and conditions set out in the 2018 French RSU Plan, the terms and conditions set out in the 2018 French RSU Plan shall prevail.

1. Award Subject to Acceptance of Agreement.  The Award shall be null and void unless the Employee accepts this Agreement by executing the Award Notice in the space provided therefor and returning an original execution copy of the Award Notice to the Company (or electronically accepting this Agreement within the Employee’s stock plan account with the Company’s stock plan administrator according to the procedures then in effect).

2. Performance Period and Vesting. 

2.1 Performance-Based Vesting Conditions.  Subject to the remainder of this Section 2, the shares of Common Stock shall vest pursuant to the terms of this Agreement and the Plan based on the achievement of the performance goals set forth in the Award Notice over the performance period set forth in the Award Notice (the “Performance Period”), provided that the Employee remains in continuous employment with the Company through the end of the Performance Period (the “Vesting Date”). Attainment of the performance goals shall be determined and certified by the Committee in writing prior to the settlement of the Award.

Shares underlying Awards vested less than 2 years after the Grant Date shall be subject to a sale restriction until the second anniversary of the Grant Date.

2.2 Termination of Employment.  

(i) Termination of Employment by Reason of Death or Disability.  If, prior to the Vesting Date, the Employee’s employment is terminated by the Company by reason of death or Disability, the Employee or the Employee’s beneficiary, as the case may be, shall be entitled to a prorated payment equal to the target number of shares of Common Stock subject to this Award multiplied by a fraction, the numerator of which shall equal the number of days such Employee was employed with the Company during the Performance Period and the denominator of which shall equal the number of days in the Performance Period. The portion of the Award that does not become vested pursuant to this clause (i) shall be immediately forfeited.

(ii) Termination of Employment by Reason of Retirement.  If, prior to the Vesting Date, the Employee’s employment is terminated by reason of Retirement, the Employee or the Employee’s beneficiary, as the case may be, shall be entitled to a prorated payment.  Such prorated payment shall be determined in accordance with the Award Notice at the end of the Performance Period based on the actual performance during the Performance Period multiplied by a fraction, the numerator of which shall equal the number of days such Employee was employed with the Company during the Performance Period and the denominator of which shall equal the number of days in the Performance Period.  The portion of the Award that does not become vested pursuant to this clause (i) shall be immediately forfeited.

(iii) Termination of Employment for any Other Reason. If, prior to the Vesting Date, an Employee’s employment with the Company is terminated for any reason other than as set forth in Section 2.2(i) and 2.2(ii), such Employee’s Award shall be immediately forfeited.

(iv) Change in Control.  In the event of a Change in Control prior to the Vesting Date, the Performance Period shall end as of the date on which the Change in Control is consummated (the “Change in Control Performance Period”) and the Employee shall be eligible to receive an Award determined in accordance with the Award Notice based on actual performance during the Change in Control Performance Period;  provided,  however, if the Change in Control occurs after the date on which an Employee’s employment is terminated by reason of Retirement, pursuant to Section 2.2(i)(ii), the Employee shall be eligible to receive an Award determined in accordance with the Award Notice based on actual performance during the Change in Control Performance Period and prorated in accordance with Section 2.2(ii) based on the number of days such Employee was employed with the Company during the Performance Period.  In the event of a Change in Control prior to the Vesting Date and after the date on which the Employee’s employment with the Company terminated where the Award shall already have been forfeited pursuant to Section 2.2(i) and Section 2.2(iii), as applicable, the Employee shall not be eligible for any payment (or, in the case of Section 2.2(i), any further payment) with respect to the Award.

(f)Definitions.  For purposes of this Agreement, the following terms shall be defined as follows:

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(1)“Cause” shall mean (i) the commission of a felony involving moral turpitude, (ii) the commission of a fraud, (iii) the commission of any material 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) the willful and continued failure by the Employee to substantially perform the Employee’s duties with the Company (other than any such failure resulting from the Employee’s incapacity due to physical or mental illness) after a written demand for substantial performance is delivered to the Employee by the Company, which demand specifically identifies the manner in which the Company believes that the Employee has not substantially performed the Employee’s duties, (vi) breach of any restrictive covenant provision or agreement with the Company or (vii) any breach by the Employee of any written agreement with the Company or any of its subsidiaries or affiliates which is material and which is not cured within 30 days following written notice thereof to the Employee by the Company.

(2)“Disability” shall mean that the Employee either (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or (ii) by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, is receiving income replacement benefits for a period of not less than six (6) months under an accident and health plan covering employees of the Employee’s employer.

(3)“Retirement”  shall mean termination of employment, other than for Cause, either (i) at or after age 55 after a minimum of (a) ten (10) years of employment with the Company, or (b) ten (10) years of employment with the Company after applying five (5) years of credit for previous work experience in accordance with Company policy or (ii) at or after age 65.  For purposes of determining whether Employee has satisfied the service requirement for Retirement, employment with an entity or business acquired by the Company shall be deemed to be employment with the Company. 

3. Conversion of Restricted Stock Units and Issuance of Shares.  Upon the vesting of all or any portion of the Award in accordance with Section 2 hereof, one share of Common Stock shall be issuable for each restricted stock unit that vests on such date, subject to the terms and provisions of the Plan and this Agreement.  Thereafter, the Company will transfer such shares to the Employee upon satisfaction of any required tax withholding obligations.  No fractional shares shall be issued under this Agreement.

4. Rights as a Stockholder.  The Employee shall not be entitled to any privileges of ownership (including any voting rights or rights with respect to dividends paid on the Common Stock) with respect to any of the shares of Common Stock issuable under the Award unless and until, and only to the extent, the Award is settled by the issuance of such shares to the Employee.

5. Additional Terms and Conditions of Award. 

5.1 Nontransferability of Award.  During the Performance Period, the restricted stock units subject to the Award and not then vested may not be transferred by the Employee except in the event of death or Disability as described in the Sub-Plan.  Except as permitted by the foregoing, during the Performance Period, the restricted stock units subject to the Award and not then vested may not be sold, transferred, assigned, pledged, hypothecated, encumbered or otherwise disposed of (whether by operation of law or otherwise) or be subject to execution, attachment or similar process.  Any such attempted sale, transfer, assignment, pledge, hypothecation or encumbrance, or other disposition of such restricted stock units shall be null and void.

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5.2 Withholding Taxes.  (a)  As a condition precedent to the delivery to the Employee of any of the shares of Common Stock subject to the Award, the Employee shall, upon request by the Company, pay to the Company (or shall cause a broker-dealer on behalf of the Employee to pay to the Company) such amount of cash as the Company may be required, under all applicable federal, state, local or other laws or regulations, to withhold and pay over as income or other withholding taxes (the “Required Tax Payments”) with respect to the Award.  If the Employee shall fail to advance the Required Tax Payments after request by the Company, the Company may, in its discretion, deduct any Required Tax Payments from any amount then or thereafter payable by the Company to the Employee.

(b)Under the terms of this Agreement, the Employee’s obligations to pay the Required Tax Payments shall be satisfied by the Company selling whole shares of Common Stock delivered upon vesting having an aggregate Market Value, determined as of the date on which such withholding obligation arises (the “Tax Date”), equal to the Required Tax Payments; provided,  however, the Employee may notify the Company prior to the Tax Date that the Employee has elected, in lieu of the Company withholding shares of Common Stock, to satisfy his or her obligation to advance the Required Tax Payments by (i) a check or cash payment to the Company, (ii) delivery to the Company (either actual delivery or by attestation procedures established by the Company) of previously owned whole shares of Common Stock having an aggregate Market Value, determined as of the Tax Date, equal to the Required Tax Payments, (iii) except as may be prohibited by applicable law, a cash payment by a broker whom the Company has selected for this purpose and to whom the Employee has authorized to sell any shares acquired upon the vesting of the Award to meet the Required Tax Payments; or (iv) any combination of share withholding and (i), (ii) and (iii). Shares to be delivered to or to be sold by the Company may not have a Market Value in excess of the minimum amount of the Required Tax Payments (or such greater withholding amount to the extent permitted by applicable withholding rules and accounting rules without resulting in variable accounting treatment).  Any fraction of a share which would be required to satisfy any such obligation shall be disregarded and the remaining amount due shall be paid in cash by the Employee. 

5.3 Compliance with Applicable Law.  The Award is subject to the condition that if the listing, registration or qualification of the shares of Common Stock subject to the Award upon any securities exchange or under any law, or the consent or approval of any governmental body, or the taking of any other action is necessary or desirable as a condition of, or in connection with, the vesting of the restricted stock units or the delivery of the shares hereunder, the shares of Common  Stock subject to the Award may not be delivered, in whole or in part, unless such listing, registration, qualification, consent or approval shall have been effected or obtained, free of any conditions not acceptable to the Company.  The Company agrees to use reasonable efforts to effect or obtain any such listing, registration, qualification, consent or approval.

5.4 Issuance of Shares.  As soon as practicable after the applicable Vesting Date or, if applicable, the date of the Participant’s termination of employment due to death or Disability or the end of the Change in Control Performance Period (but no later than the March 15th occurring immediately after the Vesting Date, the date of the Participant’s termination of employment due to death or Disability or the end of the Change in Control Performance Period, as applicable), the Company shall issue or cause to be issued in the Employee’s name (or such other name as is acceptable to the Company and designated in writing by the Employee) the vested shares of Common Stock.  Such issuance shall be evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company (or, alternatively at the discretion of the Company, a certificate or certificates may be registered in the Employee’s name).  The Company shall pay all original issue or transfer taxes and all fees and expenses incident to such delivery, except as otherwise provided in Section 5.2.

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5.5 Award Confers No Rights to Continued Employment.  In no event shall the granting of the Award or its acceptance by the Employee give or be deemed to give the Employee any right to continued employment by the Company or any Affiliate of the Company.

5.6 Decisions of Board or Committee.  The Board of Directors of the Company or the Committee shall have the right to resolve all questions which may arise in connection with the Award.  Any interpretation, determination or other action made or taken by the Board of Directors or the Committee regarding the Plan or this Agreement shall be final, binding and conclusive.

5.7 Company to Reserve Shares.  The Company shall at all times prior to the cancellation of the Award reserve and keep available, either in its treasury or out of it authorized but unissued shares of Common Stock, shares of Common Stock equal to the full number of unvested restricted stock units subject to the Award from time to time.

5.8 Agreement Subject to the Plan; Section 409A of the Code.  This Agreement is subject to the provisions of the Plan (including the adjustment provision set forth in Section 7(b) thereof) and shall be interpreted in accordance therewith.  The Employee hereby acknowledges receipt of a copy of the Plan.  This Program and the Awards granted hereunder are intended to be exempt from Section 409A of the Code as short-term deferrals pursuant to U.S., Treasury Regulation §1.409A-1(b)(4), and shall be interpreted and construed accordingly. Each payment hereunder shall be considered a separate payment for purposes of Section 409A of the Code. The Company reserves the right to amend this Agreement to the extent it determines in its sole discretion such amendment is necessary or appropriate to comply with applicable law, including but not limited to Section 409A of the Code.  Notwithstanding the foregoing, under no circumstances shall the Company be responsible for any taxes, penalties, interest or other losses or expenses incurred by the Employee due to any failure to comply with Section 409A of the Code.    

6. Miscellaneous Provisions.

6.1 Meaning of Certain Terms.  As used herein, employment by the Company shall include employment by an Affiliate of the Company.

6.2 Successors.  This Agreement shall be binding upon and inure to the benefit of any successor or successors of the Company and any person or persons who shall, upon the death of the Employee, acquire any rights hereunder in accordance with this Agreement or the Plan.

6.3 Notices.  All notices, requests or other communications provided for in this Agreement shall be made in writing by (a) actual delivery to the party entitled thereto, (b) mailing to the last known address of the party entitled thereto, via certified or registered mail, return receipt requested or (c) telecopy with confirmation of receipt.  The notice, request or other communication shall be deemed to be received, in the case of actual delivery, on the date of its actual receipt by the party entitled thereto, in the case of mailing, on the tenth calendar day following the date of such mailing, and in the case of telecopy, on the date of confirmation of receipt; provided, however, that if a notice, request or other communication is not received during regular business hours, it shall be deemed to be received on the next succeeding business day of the Company.

6.4 Governing Law.  This Agreement and all determinations made and actions taken pursuant hereto, to the extent not otherwise governed by the laws of the United States, shall be governed by the laws of the State of Delaware and construed in accordance therewith without giving effect to conflicts of laws principles.

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6.5 Award Subject to Clawback.  The Award are subject to forfeiture, recovery by the Company or other action pursuant to any clawback or recoupment policy which the Company may adopt from time to time to comply with applicable law, including without limitation any such policy which the Company may be required to adopt under the Dodd-Frank Wall Street Reform and Consumer Protection Act and implementing rules and regulations thereunder.

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EX-10.3

Exhibit 10.3

All-Other employee version

APTARGROUP, INC.

RESTRICTED STOCK UNIT AWARD AGREEMENT

(PERFORMANCE-BASED VESTING FORM)

AptarGroup, Inc., a Delaware corporation (the “Company”), hereby grants the participant (the “Employee”) as of _________ (the “Grant Date”), pursuant to Section 6(d) of the AptarGroup, Inc. 2018 Equity Incentive Plan (the “Plan”), a restricted stock unit award (the “Award”) with respect to the number of shares of the Company’s Common Stock, par value $0.01 per share (the “Common Stock”) set forth in the Award Notice, upon and subject to the restrictions, terms and conditions set forth below.  Capitalized terms not defined herein shall have the meanings specified in the Plan.

1. Award Subject to Acceptance of Agreement.  The Award shall be null and void unless the Employee accepts this Agreement by executing the Award Notice in the space provided therefor and returning an original execution copy of the Award Notice to the Company  (or electronically accepting this Agreement within the Employee’s stock plan account with the Company’s stock plan administrator according to the procedures then in effect).

2. Performance Period and Vesting. 

2.1 Performance-Based Vesting Conditions.  Subject to the remainder of this Section 2, the shares of Common Stock shall vest pursuant to the terms of this Agreement and the Plan based on the achievement of the performance goals set forth in the Award Notice over the performance period set forth in the Award Notice (the “Performance Period”), provided that that the Employee remains in continuous employment with the Company through the end of the Performance Period (the “Vesting Date”).  Attainment of the performance goals shall be determined and certified by the Committee in writing prior to the settlement of the Award.

2.2 Termination of Employment.  

(i) Termination of Employment by Reason of Death or Disability.  If, prior to the Vesting Date, the Employee’s employment is terminated by the Company by reason of death or Disability, the Employee or the Employee’s beneficiary, as the case may be, shall be entitled to a prorated payment equal to the target number of shares of Common Stock subject to this Award multiplied by a fraction, the numerator of which shall equal the number of days such Employee was employed with the Company during the Performance Period and the denominator of which shall equal the number of days in the Performance Period.  The portion of the Award that does not become vested pursuant to this clause (i) shall be immediately forfeited.

(ii) Termination of Employment by Reason of Retirement.  If, prior to the Vesting Date, the Employee’s employment is terminated by reason of Retirement, the Employee or the Employee’s beneficiary, as the case may be, shall be entitled to a prorated payment.  Such prorated payment shall be determined in accordance with the Award Notice at the end of the Performance Period based on the actual performance during the Performance Period multiplied by a fraction, the numerator of which shall equal the number of days such Employee was employed with the Company during the Performance Period and the denominator of which shall equal the number of days in the Performance Period.  The portion of the Award that does not become vested pursuant to this clause (i) shall be immediately forfeited.

(iii) Termination of Employment for any Other Reason. If, prior to the Vesting Date, an Employee’s employment with the Company is terminated for any reason other than as set forth in Section 2.2(i) and 2.2(ii), such Employee’s Award shall be immediately forfeited.

(iv) Change in Control.  In the event of a Change in Control prior to the Vesting Date, the Performance Period shall end as of the date on which the Change in Control is consummated (the “Change in Control Performance Period”) and the Employee shall be eligible to receive an Award determined in accordance with the Award Notice based on actual performance during the Change in Control Performance Period;  provided,  however, if the Change in Control occurs after the date on which an Employee’s employment is terminated by reason of Retirement, pursuant to Section 2.2(i)(ii), the Employee shall be eligible to receive an Award determined in accordance with the Award Notice based on actual performance during the Change in Control Performance Period and prorated in accordance with Section 2.2(ii) based on the number of days such Employee was employed with the Company during the Performance Period.  In the event of a Change in Control prior to the Vesting Date and after the date on which the Employee’s employment with the Company terminated where the Award shall already have been forfeited pursuant to Section 2.2(i) and Section 2.2(iii), as applicable, the Employee shall not be eligible for any payment (or, in the case of Section 2.2(i), any further payment) with respect to the Award.

(f)Definitions.  For purposes of this Agreement, the following terms shall be defined as follows:

(1)“Cause” shall mean (i) the commission of a felony involving moral turpitude, (ii) the commission of a fraud, (iii) the commission of any material 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) the willful and continued failure by the Employee to substantially perform the Employee’s duties with the Company (other than any such failure resulting from the Employee’s incapacity due to physical or mental illness) after a written demand for substantial performance is delivered to the Employee by the Company, which demand specifically identifies the manner in which the Company believes that the Employee has not substantially performed the Employee’s duties, (vi) breach of any restrictive covenant provision or agreement with the Company or (vii) any breach by the Employee of any written agreement with the Company or any of its subsidiaries or affiliates which is material and which is not cured within 30 days following written notice thereof to the Employee by the Company.

(2)“Disability” shall mean that the Employee either (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or (ii) by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, is receiving income replacement benefits for a period of not less than six (6) months under an accident and health plan covering employees of the Employee’s employer.

(3)“Retirement”  shall mean termination of employment, other than for Cause, either (i) at or after age 55 after a minimum of (a) ten (10) years of employment with the Company, or (b) ten (10) years of employment with the Company after applying five (5) years of credit for previous work experience in accordance with Company policy or (ii) at or after age 65.  For purposes of determining whether Employee has satisfied the service requirement for Retirement, employment with an entity or business acquired by the Company shall be deemed to be employment with the Company. 

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3. Conversion of Restricted Stock Units and Issuance of Shares.  Upon the vesting of all or any portion of the Award in accordance with Section 2 hereof, one share of Common Stock shall be issuable for each restricted stock unit that vests on such date, subject to the terms and provisions of the Plan and this Agreement.  Thereafter, the Company will transfer such shares to the Employee upon satisfaction of any required tax withholding obligations.  No fractional shares shall be issued under this Agreement.

4. Rights as a Stockholder.  The Employee shall not be entitled to any privileges of ownership (including any voting rights or rights with respect to dividends paid on the Common Stock) with respect to any of the shares of Common Stock issuable under the Award unless and until, and only to the extent, the Award is settled by the issuance of such shares to the Employee.

5. Additional Terms and Conditions of Award. 

5.1 Nontransferability of Award.  During the Performance Period, the restricted stock units subject to the Award and not then vested may not be transferred by the Employee other than by will, the laws of descent and distribution or pursuant to Section 7(a) of the Plan on a beneficiary designation form approved by the Company.  Except as permitted by the foregoing, during the Performance Period, the restricted stock units subject to the Award and not then vested may not be sold, transferred, assigned, pledged, hypothecated, encumbered or otherwise disposed of (whether by operation of law or otherwise) or be subject to execution, attachment or similar process.  Any such attempted sale, transfer, assignment, pledge, hypothecation or encumbrance, or other disposition of such restricted stock units shall be null and void.

5.2 Withholding Taxes.  (a)  As a condition precedent to the delivery to the Employee of any of the shares of Common Stock subject to the Award, the Employee shall, upon request by the Company, pay to the Company (or shall cause a broker-dealer on behalf of the Employee to pay to the Company) such amount of cash as the Company may be required, under all applicable federal, state, local or other laws or regulations, to withhold and pay over as income or other withholding taxes (the “Required Tax Payments”) with respect to the Award.  If the Employee shall fail to advance the Required Tax Payments after request by the Company, the Company may, in its discretion, deduct any Required Tax Payments from any amount then or thereafter payable by the Company to the Employee.

(b)Under the terms of this Agreement, the Employee’s obligations to pay the Required Tax Payments shall be satisfied by the Company withholding whole shares of Common Stock which would otherwise be issued or transferred to the Employee having an aggregate Market Value, determined as of the date on which such withholding obligation arises (the “Tax Date”), equal to the Required Tax Payments; provided,  however, the Employee may notify the Company prior to the Tax Date that the Employee has elected, in lieu of the Company withholding shares of Common Stock, to satisfy his or her obligation to advance the Required Tax Payments by (i) a check or cash payment to the Company, (ii) delivery to the Company (either actual delivery or by attestation procedures established by the Company) of previously owned whole shares of Common Stock having an aggregate Market Value, determined as of the Tax Date, equal to the Required Tax Payments, (iii) except as may be prohibited by applicable law, a cash payment by a broker whom the Company has selected for this purpose and to whom the Employee has authorized to sell any shares acquired upon the vesting of the Award to meet the Required Tax Payments; or (iv) any combination of share withholding and (i), (ii) and (iii).  Shares to be delivered to the Company or withheld may not have a Market Value in excess of the minimum amount of the Required Tax Payments (or such greater withholding amount to the extent permitted by applicable withholding rules and accounting rules without resulting in variable accounting treatment).  Any fraction of a share which would be required to satisfy any such obligation shall be disregarded and the remaining amount due shall be paid in cash by the Employee. 

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5.3 Compliance with Applicable Law.  The Award is subject to the condition that if the listing, registration or qualification of the shares of Common Stock subject to the Award upon any securities exchange or under any law, or the consent or approval of any governmental body, or the taking of any other action is necessary or desirable as a condition of, or in connection with, the vesting of the restricted stock units or the delivery of the shares hereunder, the shares of Common  Stock subject to the Award may not be delivered, in whole or in part, unless such listing, registration, qualification, consent or approval shall have been effected or obtained, free of any conditions not acceptable to the Company.  The Company agrees to use reasonable efforts to effect or obtain any such listing, registration, qualification, consent or approval.

5.4 Issuance of Shares.  As soon as practicable after the applicable Vesting Date or, if applicable, the date of the Participant’s termination of employment due to death or Disability or the end of the Change in Control Performance Period (but no later than the March 15th occurring immediately after the Vesting Date, the date of the Participant’s termination of employment due to death or Disability or the end of the Change in Control Performance Period, as applicable), the Company shall issue or cause to be issued in the Employee’s name (or such other name as is acceptable to the Company and designated in writing by the Employee) the vested shares of Common Stock.  Such issuance shall be evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company (or, alternatively at the discretion of the Company, a certificate or certificates may be registered in the Employee’s name).  The Company shall pay all original issue or transfer taxes and all fees and expenses incident to such delivery, except as otherwise provided in Section 5.2.

5.5 Award Confers No Rights to Continued Employment.  In no event shall the granting of the Award or its acceptance by the Employee give or be deemed to give the Employee any right to continued employment by the Company or any Affiliate of the Company.

5.6 Decisions of Board or Committee.  The Board of Directors of the Company or the Committee shall have the right to resolve all questions which may arise in connection with the Award.  Any interpretation, determination or other action made or taken by the Board of Directors or the Committee regarding the Plan or this Agreement shall be final, binding and conclusive.

5.7 Company to Reserve Shares.  The Company shall at all times prior to the cancellation of the Award reserve and keep available, either in its treasury or out of it authorized but unissued shares of Common Stock, shares of Common Stock equal to the full number of unvested restricted stock units subject to the Award from time to time.

5.8 Agreement Subject to the Plan; Section 409A of the Code.  This Agreement is subject to the provisions of the Plan (including the adjustment provision set forth in Section 7(b) thereof) and shall be interpreted in accordance therewith.  The Employee hereby acknowledges receipt of a copy of the Plan.  This Program and the Awards granted hereunder are intended to be exempt from Section 409A of the Code as short-term deferrals pursuant to U.S., Treasury Regulation §1.409A-1(b)(4), and shall be interpreted and construed accordingly. Each payment hereunder shall be considered a separate payment for purposes of Section 409A of the Code. The Company reserves the right to amend this Agreement to the extent it determines in its sole discretion such amendment is necessary or appropriate to comply with applicable law, including but not limited to Section 409A of the Code.  Notwithstanding the foregoing, under no circumstances shall the Company be responsible for any taxes, penalties, interest or other losses or expenses incurred by the Employee due to any failure to comply with Section 409A of the Code.    

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6. Miscellaneous Provisions.

6.1 Meaning of Certain Terms.  As used herein, employment by the Company shall include employment by an Affiliate of the Company.

6.2 Successors.  This Agreement shall be binding upon and inure to the benefit of any successor or successors of the Company and any person or persons who shall, upon the death of the Employee, acquire any rights hereunder in accordance with this Agreement or the Plan.

6.3 Notices.  All notices, requests or other communications provided for in this Agreement shall be made in writing by (a) actual delivery to the party entitled thereto, (b) mailing to the last known address of the party entitled thereto, via certified or registered mail, return receipt requested or (c) telecopy with confirmation of receipt.  The notice, request or other communication shall be deemed to be received, in the case of actual delivery, on the date of its actual receipt by the party entitled thereto, in the case of mailing, on the tenth calendar day following the date of such mailing, and in the case of telecopy, on the date of confirmation of receipt; provided, however, that if a notice, request or other communication is not received during regular business hours, it shall be deemed to be received on the next succeeding business day of the Company.

6.4 Governing Law.  This Agreement and all determinations made and actions taken pursuant hereto, to the extent not otherwise governed by the laws of the United States, shall be governed by the laws of the State of Delaware and construed in accordance therewith without giving effect to conflicts of laws principles.

6.5 Award Subject to Clawback.  The Award and any shares delivered pursuant to the Award are subject to forfeiture, recovery by the Company or other action pursuant to any clawback or recoupment policy which the Company may adopt from time to time to comply with applicable law, including without limitation any such policy which the Company may be required to adopt under the Dodd-Frank Wall Street Reform and Consumer Protection Act and implementing rules and regulations thereunder.

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EX-10.4

Exhibit 10.4

U.S./Mexico/Argentina employee version

APTARGROUP, INC.

2018 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

(SERVICE-BASED VESTING FORM)
(non-French employee version)

AptarGroup, Inc., a Delaware corporation (the “Company”), hereby grants the participant (the “Employee”) as of [Insert Date] (the “Grant Date”), pursuant to Section 6(d) of the AptarGroup, Inc. 2018 Equity Incentive Plan (the “Plan”), a restricted stock unit award (the “Award”) of the restricted stock units deposited into the Employee’s account as of the Grant Date, upon and subject to the restrictions, terms and conditions set forth below.  Capitalized terms not defined herein shall have the meanings specified in the Plan.

1. Award Subject to Acceptance of Agreement.  The Award shall be null and void unless the Employee accepts this Agreement by electronically accepting this Agreement within the Employee’s stock plan account with the Company’s stock plan administrator according to the procedures then in effect.

2. Restriction Period and Vesting.  (a)  The Award shall vest (i)  with respect to [Insert Number] number of restricted stock units subject to the Award on each of the [Insert Year] anniversaries of the Grant Date or (ii) as otherwise provided pursuant to this Section 2 (the “Restriction Period”).

(b)If the Employee’s employment by the Company terminates by reason of Retirement during the Restriction Period, the Award shall be settled in accordance with the vesting schedule  set forth in Section 2(a)(i) or earlier pursuant to Section 2(e) hereof; provided, however, that if the Employee dies after such Employee’s termination of employment by reason of Retirement, the portion of the Award, if any, which has not yet been settled as of the date of death shall become fully payable as of the date of death. 

(c)Upon the Employee’s Disability or Deathduring the Restriction Period, the Award shall become fully vested as of the date of the Employee’s Disability or Death, as the case may be. 

(d)If the Employee’s employment by the Company terminates prior to the end of the Restriction Period and prior to any of the events described in this Section 2, then the portion of the Award, if any, which is not vested as of the effective date of the Employee’s termination of employment shall be forfeited and cancelled by the Company. 

(e)(1)  In the event of a Change in Control, the Award shall immediately vest in full and become payable, except as otherwise provided in the last sentence of Section 2(e)(2) hereof.

(2)In the event of a Change in Control pursuant to paragraph (3) or (4) of Appendix A to the Plan, the Board of Directors (as constituted prior to such Change in Control) may, in its discretion (subject to existing contractual arrangements):

(i)require that shares of stock of the corporation resulting from such Change in Control, or a parent corporation thereof, be substituted for some or all of the Shares (as defined in Section 3) issuable pursuant to the Award, as determined by the Board of Directors; and/or

(ii)require the Award, in whole or in part, to be surrendered to the Company by the Employee and to be immediately cancelled by the Company, and provide for the Employee to receive a cash payment in an amount not less than the amount determined by multiplying the number of restricted stock units subject to the Award immediately prior to such cancellation (but after giving effect to any adjustment pursuant to Section 7(b) of the Plan in respect of any transaction that gives rise to such Change in Control), by the highest per share price offered to holders of Common Stock in any transaction whereby the Change in Control takes place.

Notwithstanding the foregoing provisions of Sections 2(e)(1) and 2(e)(2), in the event that (A) the Award constitutes the payment of nonqualified deferred compensation within the meaning of Section 409A of the Code, and (B) the Change in Control does not constitute a “change in control event” within the meaning of Section 409A of the Code, the Award shall vest upon such Change in Control, and shall be payable in the shares of stock substituted, as determined by the Board of Directors pursuant to Section 2(e)(2)(i) hereof, for the Shares (as defined in Section 3 hereof) issuable pursuant to the Award, or the Award shall be payable in cash, as determined by the Board of Directors pursuant to Section 2(e)(2)(ii) hereof, in either case, in accordance with the vesting schedule set forth in clause (i) of Section 2(a) hereof, regardless of whether the Employee continues to be employed by the Company, or earlier pursuant to Section 2(c) hereof.

(3)The Company may, but is not required to, cooperate with the Employee if the Employee is subject to Section 16 of the Exchange Act to assure that any cash payment or substitution in accordance with the foregoing to the Employee is made in compliance with Section 16 and the rules and regulations thereunder. 

(f)If at any time prior to the earliest to occur of (i) the end of the Restriction Period and (ii) the date which is one year after the effective date of the Employee's termination of employment for any reason other than death, the Employee:

(i) directly or indirectly (whether as principal, agent, independent contractor, partner or otherwise) engages in any type of or accepts employment with or renders services to any Competing Entity or takes any action inconsistent with the fiduciary relationship of an employee to the employee's employer; provided, that, following a termination of employment, the Employee may accept employment with a Competing Entity, the businesses of which are diversified, and which with respect to one or more of its businesses considered separately is not a Competing Entity, provided, that the Company, prior to the Employee's accepting such employment, shall receive written assurances satisfactory to the Company from such Competing Entity and from the Employee that the Employee will not render services directly or indirectly in connection with any Competing Product or be employed in a position where the Employee could use or disclose confidential information of the Company or an Affiliate or of any customer or client of the Company or an Affiliate in connection with the Employee's employment responsibilities to the benefit of a Competing Entity; or

(ii) directly or indirectly induces or attempts to induce any employee, agent or customer of the Company or any Affiliate to terminate such employment, agency or business relationship, or take any action or engage in any conduct which would interfere with the employment relationship between the Company and any of its employees; or

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(iii) directly or indirectly, for the Employee or any Competing Entity, sells or offers for sale, or assists in any way in the sale of, Competing Products to any customer or client of the Company or any Affiliate, upon which the Employee has called or which the Employee has supervised while an employee of the Company or an Affiliate; or

(iv) directly or indirectly engages in any activity which is contrary, inimical or harmful to the interests of the Company or an Affiliate, including but not limited to (x) violations of Company policies, including the Company's insider trading and confidentiality policies and (y) disclosure or misuse of any confidential information or trade secrets of the Company or an Affiliate,

then the Award shall be automatically forfeited and cancelled by the Company on the date the Employee engages in such activity. If, at the time of enforcement of this Section 2(f), 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. Notwithstanding the foregoing and any other language in this Agreement, this Agreement does not supersede or preclude the enforceability of any restrictive covenant provision contained in any prior agreement entered into by Employee.  Further, no prior restrictive covenant supersedes or precludes the enforceability of any provision contained in this Agreement.

(g)The Employee may be released from the Employee's obligations under Section2(f) only if and to the extent the Committee determines in its sole discretion that such a release is in the best interests of the Company.

(h)Definitions.  For purposes of this Agreement, the following terms shall be defined as follows:

(1)“Cause” shall mean (i) the commission of a felony involving moral turpitude, (ii) the commission of a fraud, (iii) the commission of any material 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) the willful and continued failure by the Employee to substantially perform the Employee’s duties with the Company (other than any such failure resulting from the Employee’s incapacity due to physical or mental illness) after a written demand for substantial performance is delivered to the Employee by the Company, which demand specifically identifies the manner in which the Company believes that the Employee has not substantially performed the Employee’s duties, (vi) breach of any restrictive covenant provision or agreement with the Company or (vii) any breach by the Employee of any written agreement with the Company or any of its subsidiaries or affiliates which is material and which is not cured within 30 days following written notice thereof to the Employee by the Company.

(2)“Disability” shall mean that the Employee either (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or (ii) by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, is receiving income replacement benefits for a period of not less than six (6) months under an accident and health plan covering employees of the Employee’s employer.

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(3)“Retirement” shall mean termination of employment, other than for Cause, either (i) at or after age 55 after a minimum of (a) ten (10) years of employment with the Company, or (b) ten (10) years of employment with the Company after applying five (5) years of credit for previous work experience in accordance with Company policy or (ii) at or after age 65.  For purposes of determining whether Employee has satisfied the service requirement for Retirement, employment with an entity or business acquired by the Company shall be deemed to be employment with the Company. 

3. Conversion of Restricted Stock Units and Issuance of Shares.  Upon the vesting of all or any portion of the Award in accordance with Section 2 hereof, one share of the Company’s Common Stock, $0.01 par value, shall be issuable for each restricted stock unit that vests on such date (the “Shares”), subject to the terms and provisions of the Plan and this Agreement.  Thereafter, the Company will transfer such Shares to the Employee upon satisfaction of any required tax withholding obligations.  No fractional shares shall be issued under this Agreement.

4. Rights as a Stockholder.  The Employee shall not be entitled to any privileges of ownership (including any voting rights or rights with respect to dividends paid on the Common Stock) with respect to any of the Shares issuable under the Award unless and until, and only to the extent, the Award is settled by the issuance of such Shares to the Employee.

5. Additional Terms and Conditions of Award. 

5.1 Nontransferability of Award.  During the Restriction Period, the restricted stock units subject to the Award and not then vested may not be transferred by the Employee other than by will, the laws of descent and distribution or pursuant to Section 7(a) of the Plan on a beneficiary designation form approved by the Company.  Except as permitted by the foregoing, during the Restriction Period, the restricted stock units subject to the Award and not then vested may not be sold, transferred, assigned, pledged, hypothecated, encumbered or otherwise disposed of (whether by operation of law or otherwise) or be subject to execution, attachment or similar process.  Any such attempted sale, transfer, assignment, pledge, hypothecation or encumbrance, or other disposition of such restricted stock units shall be null and void.

5.2 Withholding Taxes.  (a)  As a condition precedent to the delivery to the Employee of any of the Shares subject to the Award or upon the Employee’s satisfaction of the retirement eligibility conditions set forth in Section 2(b), the Employee shall, upon request by the Company, pay to the Company (or shall cause a broker-dealer on behalf of the Employee to pay to the Company) such amount of cash as the Company may be required, under all applicable federal, state, local or other laws or regulations, to withhold and pay over as income or other withholding taxes (the “Required Tax Payments”) with respect to the Award.  If the Employee shall fail to advance the Required Tax Payments after request by the Company, the Company may, in its discretion, deduct any Required Tax Payments from any amount then or thereafter payable by the Company to the Employee.

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(b)Under the terms of this Agreement, the Employee’s obligations to pay the Required Tax Payments shall be satisfied by the Company withholding whole Shares which would otherwise be issued or transferred to the Employee having an aggregate Market Value, determined as of the date on which such withholding obligation arises (the “Tax Date”), equal to the Required Tax Payments; provided,  however, the Employee may notify the Company prior to the Tax Date that the Employee has elected, in lieu of the Company withholding Shares, to satisfy his or her obligation to advance the Required Tax Payments by (i) a check or cash payment to the Company, (ii) delivery to the Company (either actual delivery or by attestation procedures established by the Company) of previously owned whole Shares having an aggregate Market Value, determined as of the Tax Date, equal to the Required Tax Payments, (iii) except as may be prohibited by applicable law, a cash payment by a broker whom the Company has selected for this purpose and to whom the Employee has authorized to sell any shares acquired upon the vesting of the Award to meet the Required Tax Payments, or (iv) any combination of share withholding and (i), (ii) and (iii).  Shares to be delivered to the Company or withheld may not have a Market Value in excess of the minimum amount of the Required Tax Payments (or such greater withholding amount to the extent permitted by applicable withholding rules and accounting rules without resulting in variable accounting treatment).  Any fraction of a share which would be required to satisfy any such obligation shall be disregarded and the remaining amount due shall be paid in cash by the Employee.     

5.3 Compliance with Applicable Law.  The Award is subject to the condition that if the listing, registration or qualification of the Shares subject to the Award upon any securities exchange or under any law, or the consent or approval of any governmental body, or the taking of any other action is necessary or desirable as a condition of, or in connection with, the vesting of the restricted stock units or the delivery of the Shares hereunder, the Shares subject to the Award may not be delivered, in whole or in part, unless such listing, registration, qualification, consent or approval shall have been effected or obtained, free of any conditions not acceptable to the Company.  The Company agrees to use reasonable efforts to effect or obtain any such listing, registration, qualification, consent or approval.

5.4 Issuance of Shares.  Subject to Sections 5.2 and 5.3, within 60 days after the vesting (or, if later, the settlement date set forth in Section 2) of the Award, in whole or in part, the Company shall issue or cause to be issued in the Employee’s name (or such other name as is acceptable to the Company and designated in writing by the Employee) the vested Shares.  Such issuance shall be evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company (or, alternatively at the discretion of the Company, a certificate or certificates may be registered in the Employee’s name).  The Company shall pay all original issue or transfer taxes and all fees and expenses incident to such delivery, except as otherwise provided in Section 5.2.

5.5 Award Confers No Rights to Continued Employment.  In no event shall the granting of the Award or its acceptance by the Employee give or be deemed to give the Employee any right to continued employment by the Company or any Affiliate of the Company.

5.6 Decisions of Board or Committee.  The Board of Directors of the Company or the Committee shall have the right to resolve all questions which may arise in connection with the Award.  Any interpretation, determination or other action made or taken by the Board of Directors or the Committee regarding the Plan or this Agreement shall be final, binding and conclusive.

5.7 Company to Reserve Shares.  The Company shall at all times prior to the cancellation of the Award reserve and keep available, either in its treasury or out of it authorized but unissued shares of Common Stock, shares of Common Stock equal to the full number of unvested restricted stock units subject to the Award from time to time.

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5.8 Agreement Subject to the Plan; Section 409A of the Code.  This Agreement is subject to the provisions of the Plan (including the adjustment provision set forth in Section 7(b) thereof) and shall be interpreted in accordance therewith.  The Employee hereby acknowledges receipt of a copy of the Plan.  This Agreement shall be interpreted and construed in a manner that avoids the imposition of taxes and other penalties under Section 409A of the Code.  The Company reserves the right to amend this Agreement to the extent it determines in its sole discretion such amendment is necessary or appropriate to comply with applicable law, including but not limited to Section 409A of the Code.  Notwithstanding the foregoing, under no circumstances shall the Company be responsible for any taxes, penalties, interest or other losses or expenses incurred by the Employee due to any failure to comply with Section 409A of the Code.    

6. No Interference. Nothing in this Agreement prohibits the Employee from filing a charge with, or reporting possible violations of federal law or regulation to any governmental agency or entity, including but not limited to the U.S. Equal Opportunity Commission, the Department of Justice, the Securities and Exchange Commission, Congress, and any agency Inspector General, or making other disclosures that are protected under the whistleblower provisions of federal law or regulation. The Employee does not need the prior authorization of the Company to make any such reports or disclosures and is not required to notify the Company that he has made such reports or disclosures. In addition, this Agreement does not limit the Employee's right to receive an award for information provided to any government agencies. Furthermore, nothing in this Agreement shall limit the Employee's ability (i) to disclose in confidence trade secrets to federal, state, and local government officials, or to an attorney, for the sole purpose of reporting or investigating a suspected violation of law or (ii) disclose trade secrets in a document filed in a lawsuit or other proceeding, but only if the filing is made under seal and protected from public disclosure. Nothing in this Agreement is intended to conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by 18 U.S.C. § 1833(b).

7. Clawback of Proceeds and Setoff.  

7.1 Clawback of Proceeds.  This Award is subject to the clawback provisions in Section 7(j) of the Plan. In addition, if the Employee violates Section 2(f) of this Agreement, then any and all Award Proceeds (as hereinafter defined) attributable to the settlement of any portion of the Award within the 24-month period immediately preceding or any time after the date of the Employee’s termination of employment or service with the Company shall be immediately due and payable by the Employee to the Company. For purposes of this Section, “Proceeds” shall mean the Market Value of a share of Common Stock on the date such portion of the Award was settled, multiplied by the number of shares of Common Stock issued to the Employee pursuant to the settlement of such portion of the Award. The remedy provided by this Section shall be in addition to and not in lieu of any rights or remedies which the Company may have against the Employee in respect of a breach by the Employee of any duty or obligation to the Company.

7.2 Right of Setoff. The Employee agrees that by accepting the Award the Employee authorizes the Company and its affiliates to deduct, to the extent permitted by applicable law, any amount or amounts owed by the Employee pursuant to this Section 7 from any amounts payable by or on behalf of the Company or any affiliate to the Employee, including, without limitation, any amount payable to the Employee as salary, wages, vacation pay, bonus or the vesting or settlement of the Award or any stock-based award. This right of setoff shall not be an exclusive remedy and the Company’s or an affiliate’s election not to exercise this right of setoff with respect to any amount payable to the Employee shall not constitute a waiver of this right of setoff with respect to any other amount payable to the Holder or any other remedy.

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8. Miscellaneous Provisions.

8.1 Meaning of Certain Terms.  As used herein, employment by the Company shall include employment by an Affiliate of the Company.

8.2 Successors.  This Agreement shall be binding upon and inure to the benefit of any successor or successors of the Company and any person or persons who shall, upon the death of the Employee, acquire any rights hereunder in accordance with this Agreement or the Plan.

8.3 Notices.  All notices, requests or other communications provided for in this Agreement shall be made in writing by (a) actual delivery to the party entitled thereto, (b) mailing to the last known address of the party entitled thereto, via certified or registered mail, return receipt requested or (c) telecopy with confirmation of receipt.  The notice, request or other communication shall be deemed to be received, in the case of actual delivery, on the date of its actual receipt by the party entitled thereto, in the case of mailing, on the tenth calendar day following the date of such mailing, and in the case of telecopy, on the date of confirmation of receipt; provided, however, that if a notice, request or other communication is not received during regular business hours, it shall be deemed to be received on the next succeeding business day of the Company.

8.4 Governing Law.  This Agreement and all determinations made and actions taken pursuant hereto, to the extent not otherwise governed by the laws of the United States, shall be governed by the laws of the State of Delaware and construed in accordance therewith without giving effect to conflicts of laws principles.

APTARGROUP, INC.

By:  [Authorized Representative]

Acknowledgment, Acceptance and Agreement:

By accepting this grant on the Company’s stock plan administrator’s website, I hereby accept the restricted stock units granted to me and acknowledge and agree to be bound by the terms and conditions of the Agreement and the Plan.

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EX-10.5

Exhibit 10.5

All Other employee version

APTARGROUP, INC.

2018 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

(SERVICE-BASED VESTING FORM)
(non-French employee version)

AptarGroup, Inc., a Delaware corporation (the “Company”), hereby grants the participant (the “Employee”) as of [Insert Date] (the “Grant Date”), pursuant to Section 6(d) of the AptarGroup, Inc. 2018 Equity Incentive Plan (the “Plan”), a restricted stock unit award (the “Award”) of the restricted stock units deposited into the Employee’s account as of the Grant Date, upon and subject to the restrictions, terms and conditions set forth below.  Capitalized terms not defined herein shall have the meanings specified in the Plan.

1. Award Subject to Acceptance of Agreement.  The Award shall be null and void unless the Employee accepts this Agreement by electronically accepting this Agreement within the Employee’s stock plan account with the Company’s stock plan administrator according to the procedures then in effect.

2. Restriction Period and Vesting.  (a)  The Award shall vest (i)  with respect to [Insert Number] number of restricted stock units subject to the Award on each of the [Insert Year] anniversaries of the Grant Date or (ii) as otherwise provided pursuant to this Section 2 (the “Restriction Period”). 

(b)If the Employee’s employment by the Company terminates by reason of Retirement during the Restriction Period, the Award shall be settled in accordance with the vesting schedule  set forth in Section 2(a)(i) or earlier pursuant to Section 2(e) hereof; provided, however, that if the Employee dies after such Employee’s termination of employment by reason of Retirement, the portion of the Award, if any, which has not yet been settled as of the date of death shall become fully payable as of the date of death. 

(c)Upon the Employee’s Disability or Deathduring the Restriction Period, the Award shall become fully vested as of the date of the Employee’s Disability or Death, as the case may be. 

(d)If the Employee’s employment by the Company terminates prior to the end of the Restriction Period and prior to any of the events described in this Section 2, then the portion of the Award, if any, which is not vested as of the effective date of the Employee’s termination of employment shall be forfeited and cancelled by the Company. 

(e)(1)  In the event of a Change in Control, the Award shall immediately vest in full and become payable, except as otherwise provided in the last sentence of Section 2(e)(2) hereof.

(2)In the event of a Change in Control pursuant to paragraph (3) or (4) of Appendix A to the Plan, the Board of Directors (as constituted prior to such Change in Control) may, in its discretion (subject to existing contractual arrangements):

(i)require that shares of stock of the corporation resulting from such Change in Control, or a parent corporation thereof, be substituted for some or all of the Shares (as defined in Section 3) issuable pursuant to the Award, as determined by the Board of Directors; and/or

(ii)require the Award, in whole or in part, to be surrendered to the Company by the Employee and to be immediately cancelled by the Company, and provide for the Employee to receive a cash payment in an amount not less than the amount determined by multiplying the number of restricted stock units subject to the Award immediately prior to such cancellation (but after giving effect to any adjustment pursuant to Section 7(b) of the Plan in respect of any transaction that gives rise to such Change in Control), by the highest per share price offered to holders of Common Stock in any transaction whereby the Change in Control takes place.

Notwithstanding the foregoing provisions of Sections 2(e)(1) and 2(e)(2), in the event that (A) the Award constitutes the payment of nonqualified deferred compensation within the meaning of Section 409A of the Code, and (B) the Change in Control does not constitute a “change in control event” within the meaning of Section 409A of the Code, the Award shall vest upon such Change in Control, and shall be payable in the shares of stock substituted, as determined by the Board of Directors pursuant to Section 2(e)(2)(i) hereof, for the Shares (as defined in Section 3 hereof) issuable pursuant to the Award, or the Award shall be payable in cash, as determined by the Board of Directors pursuant to Section 2(e)(2)(ii) hereof, in either case, in accordance with the vesting schedule set forth in clause (i) of Section 2(a) hereof, regardless of whether the Employee continues to be employed by the Company, or earlier pursuant to Section 2(c) hereof.

(3)The Company may, but is not required to, cooperate with the Employee if the Employee is subject to Section 16 of the Exchange Act to assure that any cash payment or substitution in accordance with the foregoing to the Employee is made in compliance with Section 16 and the rules and regulations thereunder. 

(f)Definitions.  For purposes of this Agreement, the following terms shall be defined as follows:

(1)“Cause” shall mean (i) the commission of a felony involving moral turpitude, (ii) the commission of a fraud, (iii) the commission of any material 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) the willful and continued failure by the Employee to substantially perform the Employee’s duties with the Company (other than any such failure resulting from the Employee’s incapacity due to physical or mental illness) after a written demand for substantial performance is delivered to the Employee by the Company, which demand specifically identifies the manner in which the Company believes that the Employee has not substantially performed the Employee’s duties, (vi) breach of any restrictive covenant provision or agreement with the Company or (vii) any breach by the Employee of any written agreement with the Company or any of its subsidiaries or affiliates which is material and which is not cured within 30 days following written notice thereof to the Employee by the Company.

(2)“Disability” shall mean that the Employee either (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or (ii) by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, is receiving income replacement benefits for a period of not less than six (6) months under an accident and health plan covering employees of the Employee’s employer.

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(3)“Retirement” shall mean termination of employment, other than for Cause, either (i) at or after age 55 after a minimum of (a) ten (10) years of employment with the Company, or (b) ten (10) years of employment with the Company after applying five (5) years of credit for previous work experience in accordance with Company policy or (ii) at or after age 65.  For purposes of determining whether Employee has satisfied the service requirement for Retirement, employment with an entity or business acquired by the Company shall be deemed to be employment with the Company. 

3. Conversion of Restricted Stock Units and Issuance of Shares.  Upon the vesting of all or any portion of the Award in accordance with Section 2 hereof, one share of the Company’s Common Stock, $0.01 par value, shall be issuable for each restricted stock unit that vests on such date (the “Shares”), subject to the terms and provisions of the Plan and this Agreement.  Thereafter, the Company will transfer such Shares to the Employee upon satisfaction of any required tax withholding obligations.  No fractional shares shall be issued under this Agreement.

4. Rights as a Stockholder.  The Employee shall not be entitled to any privileges of ownership (including any voting rights or rights with respect to dividends paid on the Common Stock) with respect to any of the Shares issuable under the Award unless and until, and only to the extent, the Award is settled by the issuance of such Shares to the Employee.

5. Additional Terms and Conditions of Award. 

5.1 Nontransferability of Award.  During the Restriction Period, the restricted stock units subject to the Award and not then vested may not be transferred by the Employee other than by will, the laws of descent and distribution or pursuant to Section 7(a) of the Plan on a beneficiary designation form approved by the Company.  Except as permitted by the foregoing, during the Restriction Period, the restricted stock units subject to the Award and not then vested may not be sold, transferred, assigned, pledged, hypothecated, encumbered or otherwise disposed of (whether by operation of law or otherwise) or be subject to execution, attachment or similar process.  Any such attempted sale, transfer, assignment, pledge, hypothecation or encumbrance, or other disposition of such restricted stock units shall be null and void.

5.2 Withholding Taxes.  (a)  As a condition precedent to the delivery to the Employee of any of the Shares subject to the Award or upon the Employee’s satisfaction of the retirement eligibility conditions set forth in Section 2(b), the Employee shall, upon request by the Company, pay to the Company (or shall cause a broker-dealer on behalf of the Employee to pay to the Company) such amount of cash as the Company may be required, under all applicable federal, state, local or other laws or regulations, to withhold and pay over as income or other withholding taxes (the “Required Tax Payments”) with respect to the Award.  If the Employee shall fail to advance the Required Tax Payments after request by the Company, the Company may, in its discretion, deduct any Required Tax Payments from any amount then or thereafter payable by the Company to the Employee.

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(b)Under the terms of this Agreement, the Employee’s obligations to pay the Required Tax Payments shall be satisfied by the Company withholding whole Shares which would otherwise be issued or transferred to the Employee having an aggregate Market Value, determined as of the date on which such withholding obligation arises (the “Tax Date”), equal to the Required Tax Payments; provided,  however, the Employee may notify the Company prior to the Tax Date that the Employee has elected, in lieu of the Company withholding Shares, to satisfy his or her obligation to advance the Required Tax Payments by (i) a check or cash payment to the Company, (ii) delivery to the Company (either actual delivery or by attestation procedures established by the Company) of previously owned whole Shares having an aggregate Market Value, determined as of the Tax Date, equal to the Required Tax Payments, (iii) except as may be prohibited by applicable law, a cash payment by a broker whom the Company has selected for this purpose and to whom the Employee has authorized to sell any shares acquired upon the vesting of the Award to meet the Required Tax Payments, or (iv) any combination of share withholding and (i), (ii) and (iii).  Shares to be delivered to the Company or withheld may not have a Market Value in excess of the minimum amount of the Required Tax Payments (or such greater withholding amount to the extent permitted by applicable withholding rules and accounting rules without resulting in variable accounting treatment).  Any fraction of a share which would be required to satisfy any such obligation shall be disregarded and the remaining amount due shall be paid in cash by the Employee.     

5.3 Compliance with Applicable Law.  The Award is subject to the condition that if the listing, registration or qualification of the Shares subject to the Award upon any securities exchange or under any law, or the consent or approval of any governmental body, or the taking of any other action is necessary or desirable as a condition of, or in connection with, the vesting of the restricted stock units or the delivery of the Shares hereunder, the Shares subject to the Award may not be delivered, in whole or in part, unless such listing, registration, qualification, consent or approval shall have been effected or obtained, free of any conditions not acceptable to the Company.  The Company agrees to use reasonable efforts to effect or obtain any such listing, registration, qualification, consent or approval.

5.4 Issuance of Shares.  Subject to Sections 5.2 and 5.3, within 60 days after the vesting (or, if later, the settlement date set forth in Section 2) of the Award, in whole or in part, the Company shall issue or cause to be issued in the Employee’s name (or such other name as is acceptable to the Company and designated in writing by the Employee) the vested Shares.  Such issuance shall be evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company (or, alternatively at the discretion of the Company, a certificate or certificates may be registered in the Employee’s name).  The Company shall pay all original issue or transfer taxes and all fees and expenses incident to such delivery, except as otherwise provided in Section 5.2.

5.5 Award Confers No Rights to Continued Employment.  In no event shall the granting of the Award or its acceptance by the Employee give or be deemed to give the Employee any right to continued employment by the Company or any Affiliate of the Company.

5.6 Decisions of Board or Committee.  The Board of Directors of the Company or the Committee shall have the right to resolve all questions which may arise in connection with the Award.  Any interpretation, determination or other action made or taken by the Board of Directors or the Committee regarding the Plan or this Agreement shall be final, binding and conclusive.

5.7 Company to Reserve Shares.  The Company shall at all times prior to the cancellation of the Award reserve and keep available, either in its treasury or out of it authorized but unissued shares of Common Stock, shares of Common Stock equal to the full number of unvested restricted stock units subject to the Award from time to time.

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5.8 Agreement Subject to the Plan; Section 409A of the Code.  This Agreement is subject to the provisions of the Plan (including the adjustment provision set forth in Section 7(b) thereof) and shall be interpreted in accordance therewith.  The Employee hereby acknowledges receipt of a copy of the Plan.  This Agreement shall be interpreted and construed in a manner that avoids the imposition of taxes and other penalties under Section 409A of the Code.  The Company reserves the right to amend this Agreement to the extent it determines in its sole discretion such amendment is necessary or appropriate to comply with applicable law, including but not limited to Section 409A of the Code.  Notwithstanding the foregoing, under no circumstances shall the Company be responsible for any taxes, penalties, interest or other losses or expenses incurred by the Employee due to any failure to comply with Section 409A of the Code.    

6. Miscellaneous Provisions.

6.1 Meaning of Certain Terms.  As used herein, employment by the Company shall include employment by an Affiliate of the Company.

6.2 Successors.  This Agreement shall be binding upon and inure to the benefit of any successor or successors of the Company and any person or persons who shall, upon the death of the Employee, acquire any rights hereunder in accordance with this Agreement or the Plan.

6.3 Notices.  All notices, requests or other communications provided for in this Agreement shall be made in writing by (a) actual delivery to the party entitled thereto, (b) mailing to the last known address of the party entitled thereto, via certified or registered mail, return receipt requested or (c) telecopy with confirmation of receipt.  The notice, request or other communication shall be deemed to be received, in the case of actual delivery, on the date of its actual receipt by the party entitled thereto, in the case of mailing, on the tenth calendar day following the date of such mailing, and in the case of telecopy, on the date of confirmation of receipt; provided, however, that if a notice, request or other communication is not received during regular business hours, it shall be deemed to be received on the next succeeding business day of the Company.

6.4 Governing Law.  This Agreement and all determinations made and actions taken pursuant hereto, to the extent not otherwise governed by the laws of the United States, shall be governed by the laws of the State of Delaware and construed in accordance therewith without giving effect to conflicts of laws principles.

APTARGROUP, INC.

By:  [Authorized Representative]

Acknowledgment, Acceptance and Agreement:

By accepting this grant on the Company’s stock plan administrator’s website, I hereby accept the restricted stock units granted to me and acknowledge and agree to be bound by the terms and conditions of the Agreement and the Plan.

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EX-10.6

Exhibit 10.6

APTARGROUP, INC.

2018 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

(SERVICE-BASED VESTING FORM)
(French employee version)

AptarGroup, Inc., a Delaware corporation (the “Company”), hereby grants the participant (the “Employee”) as of [Insert Date] (the “Grant Date”), pursuant to Section 6(d) of the AptarGroup, Inc. 2018 Equity Incentive Plan (the “Plan”) as amended by the 2018 French Sub-Plan for Restricted Stock Units (the “Sub-Plan”), a restricted stock unit award (the “Award”) of the restricted stock units deposited into the Employee’s account as of the Grant Date, upon and subject to the restrictions, terms and conditions set forth below.  Capitalized terms not defined herein shall have the meanings specified in the Plan.

The Award is governed by the terms and conditions of the Plan as amended by the Sub-Plan (together the “2018 French RSU Plan”).

In the event the terms and conditions set out in this Award Agreement differ from or conflict with the terms and conditions set out in the 2018 French RSU Plan, the terms and conditions set out in the 2018 French RSU Plan shall prevail.

1. Award Subject to Acceptance of Agreement.  The Award shall be null and void unless the Employee accepts this Agreement by electronically accepting this Agreement within the Employee’s stock plan account with the Company’s stock plan administrator according to the procedures then in effect.

2. Restriction Period and Vesting.  (a)  The Award shall vest (i)  in [Insert Number] increments on each of the [Insert Year] anniversaries of the Grant Date or (ii) as otherwise provided pursuant to this Section 2 (the “Restriction Period”).

Shares underlying Awards vested less than 2 years after the Grant Date shall be subject to a sale restriction until the second anniversary of the Grant Date.

(b)If the Employee’s employment by the Company terminates by reason of Retirement during the Restriction Period, the Award shall be settled in accordance with the vesting schedule  set forth in Section 2(a)(i) or earlier pursuant to Section 2(e) hereof; provided, however, that if the Employee dies after such Employee’s termination of employment by reason of Retirement, the portion of the Award, if any, which has not yet been settled as of the date of death shall become fully payable as of the date of death. 

(c)Upon the Employee’s Disability or Deathduring the Restriction Period, the Award shall become fully vested as of the date of the Employee’s Disability or Death, as the case may be. 

(d)If the Employee’s employment by the Company terminates prior to the end of the Restriction Period and prior to any of the events described in this Section 2, then the portion of the Award, if any, which is not vested as of the effective date of the Employee’s termination of employment shall be forfeited and cancelled by the Company. 

(e)(1)  In the event of a Change in Control, the Award shall immediately vest in full and become payable, except as otherwise provided in the last sentence of Section 2(e)(2) hereof.

(2)In the event of a Change in Control pursuant to paragraph (3) or (4) of Appendix A to the Plan, the Board of Directors (as constituted prior to such Change in Control) may, in its discretion (subject to existing contractual arrangements):

(i)require that shares of stock of the corporation resulting from such Change in Control, or a parent corporation thereof, be substituted for some or all of the Shares (as defined in Section 3) issuable pursuant to the Award, as determined by the Board of Directors; and/or

(ii)require the Award, in whole or in part, to be surrendered to the Company by the Employee and to be immediately cancelled by the Company, and provide for the Employee to receive a cash payment in an amount not less than the amount determined by multiplying the number of restricted stock units subject to the Award immediately prior to such cancellation (but after giving effect to any adjustment pursuant to Section 7(b) of the Plan in respect of any transaction that gives rise to such Change in Control), by the highest per share price offered to holders of Common Stock in any transaction whereby the Change in Control takes place.

Notwithstanding the foregoing provisions of Sections 2(e)(1) and 2(e)(2), in the event that (A) the Award constitutes the payment of nonqualified deferred compensation within the meaning of Section 409A of the Code, and (B) the Change in Control does not constitute a “change in control event” within the meaning of Section 409A of the Code, the Award shall vest upon such Change in Control, and shall be payable in the shares of stock substituted, as determined by the Board of Directors pursuant to Section 2(e)(2)(i) hereof, for the Shares (as defined in Section 3 hereof) issuable pursuant to the Award, or the Award shall be payable in cash, as determined by the Board of Directors pursuant to Section 2(e)(2)(ii) hereof, in either case, in accordance with the vesting schedule set forth in clause (i) of Section 2(a) hereof, regardless of whether the Employee continues to be employed by the Company, or earlier pursuant to Section 2(c) hereof.

(3)The Company may, but is not required to, cooperate with the Employee if the Employee is subject to Section 16 of the Exchange Act to assure that any cash payment or substitution in accordance with the foregoing to the Employee is made in compliance with Section 16 and the rules and regulations thereunder. 

(f)Definitions.  For purposes of this Agreement, the following terms shall be defined as follows:

(1)“Cause” shall mean (i) the commission of a felony involving moral turpitude, (ii) the commission of a fraud, (iii) the commission of any material 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) the willful and continued failure by the Employee to substantially perform the Employee’s duties with the Company (other than any such failure resulting from the Employee’s incapacity due to physical or mental illness) after a written demand for substantial performance is delivered to the Employee by the Company, which demand specifically identifies the manner in which the Company believes that the Employee has not substantially performed the Employee’s duties, (vi) breach of any restrictive covenant provision or agreement with the Company or (vii) any breach by the Employee of any written agreement with the Company or any of its subsidiaries or affiliates which is material and which is not cured within 30 days following written notice thereof to the Employee by the Company.

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(2)“Disability” shall mean that the Employee either (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or (ii) by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, is receiving income replacement benefits for a period of not less than six (6) months under an accident and health plan covering employees of the Employee’s employer.

(3)“Retirement”  shall mean termination of employment, other than for Cause, either (i) at or after age 55 after a minimum of (a) ten (10) years of employment with the Company, or (b) ten (10) years of employment with the Company after applying five (5) years of credit for previous work experience in accordance with Company policy or (ii) at or after age 65.  For purposes of determining whether Employee has satisfied the service requirement for Retirement, employment with an entity or business acquired by the Company shall be deemed to be employment with the Company. 

3. Conversion of Restricted Stock Units and Issuance of Shares.  Upon the vesting of all or any portion of the Award in accordance with Section 2 hereof, one share of the Company’s Common Stock, $0.01 par value, shall be issuable for each restricted stock unit that vests on such date (the “Shares”), subject to the terms and provisions of the Plan and this Agreement.  Thereafter, the Company will transfer such Shares to the Employee upon satisfaction of any required tax withholding obligations.  No fractional shares shall be issued under this Agreement.

4. Rights as a Stockholder.  The Employee shall not be entitled to any privileges of ownership (including any voting rights or rights with respect to dividends paid on the Common Stock) with respect to any of the Shares issuable under the Award unless and until, and only to the extent, the Award is settled by the issuance of such Shares to the Employee.

5. Additional Terms and Conditions of Award. 

5.1 Nontransferability of Award.  During the Restriction Period, the restricted stock units subject to the Award and not then vested may not be transferred by the Employee except in the event of death or Disability as described in the Sub-plan.. Except as permitted by the foregoing, during the Restriction Period, the restricted stock units subject to the Award and not then vested may not be sold, transferred, assigned, pledged, hypothecated, encumbered or otherwise disposed of (whether by operation of law or otherwise) or be subject to execution, attachment or similar process.  Any such attempted sale, transfer, assignment, pledge, hypothecation or encumbrance, or other disposition of such restricted stock units shall be null and void.

5.2 Withholding Taxes.  (a)  As a condition precedent to the delivery to the Employee of any of the Shares subject to the Award or upon the Employee’s satisfaction of the retirement eligibility conditions set forth in Section 2(b), the Employee shall, upon request by the Company, pay to the Company (or shall cause a broker-dealer on behalf of the Employee to pay to the Company) such amount of cash as the Company may be required, under all applicable federal, state, local or other laws or regulations, to withhold and pay over as income or other withholding taxes (the “Required Tax Payments”) with respect to the Award.  If the Employee shall fail to advance the Required Tax Payments after request by the Company, the Company may, in its discretion, deduct any Required Tax Payments from any amount then or thereafter payable by the Company to the Employee.

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(b)Under the terms of this Agreement, the Employee’s obligations to pay the Required Tax Payments shall be satisfied by the Company selling whole Shares delivered upon vesting having an aggregate Market Value, determined as of the date on which such withholding obligation arises (the “Tax Date”), equal to the Required Tax Payments; provided,  however, the Employee may notify the Company prior to the Tax Date that the Employee has elected, in lieu of the Company withholding Shares, to satisfy his or her obligation to advance the Required Tax Payments by (i) a check or cash payment to the Company, (ii) delivery to the Company (either actual delivery or by attestation procedures established by the Company) of previously owned whole Shares having an aggregate Market Value, determined as of the Tax Date, equal to the Required Tax Payments, (iii) except as may be prohibited by applicable law, a cash payment by a broker whom the Company has selected for this purpose and to whom the Employee has authorized to sell any shares acquired upon the vesting of the Award to meet the Required Tax Payments, or (iv) any combination of share withholding and (i), (ii) and (iii).  Shares to be delivered to or to be sold by the Company may not have a Market Value in excess of the minimum amount of the Required Tax Payments (or such greater withholding amount to the extent permitted by applicable withholding rules and accounting rules without resulting in variable accounting treatment).  Any fraction of a share which would be required to satisfy any such obligation shall be disregarded and the remaining amount due shall be paid in cash by the Employee.     

5.3 Compliance with Applicable Law.  The Award is subject to the condition that if the listing, registration or qualification of the Shares subject to the Award upon any securities exchange or under any law, or the consent or approval of any governmental body, or the taking of any other action is necessary or desirable as a condition of, or in connection with, the vesting of the restricted stock units or the delivery of the Shares hereunder, the Shares subject to the Award may not be delivered, in whole or in part, unless such listing, registration, qualification, consent or approval shall have been effected or obtained, free of any conditions not acceptable to the Company.  The Company agrees to use reasonable efforts to effect or obtain any such listing, registration, qualification, consent or approval.

5.4 Issuance of Shares.  Subject to Sections 5.2 and 5.3, within 60 days after the vesting (or, if later, the settlement date set forth in Section 2) of the Award, in whole or in part, the Company shall issue or cause to be issued in the Employee’s name (or such other name as is acceptable to the Company and designated in writing by the Employee) the vested Shares.  Such issuance shall be evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company (or, alternatively at the discretion of the Company, a certificate or certificates may be registered in the Employee’s name).  The Company shall pay all original issue or transfer taxes and all fees and expenses incident to such delivery, except as otherwise provided in Section 5.2.

5.5 Award Confers No Rights to Continued Employment.  In no event shall the granting of the Award or its acceptance by the Employee give or be deemed to give the Employee any right to continued employment by the Company or any Affiliate of the Company.

5.6 Decisions of Board or Committee.  The Board of Directors of the Company or the Committee shall have the right to resolve all questions which may arise in connection with the Award.  Any interpretation, determination or other action made or taken by the Board of Directors or the Committee regarding the Plan or this Agreement shall be final, binding and conclusive.

5.7 Company to Reserve Shares.  The Company shall at all times prior to the cancellation of the Award reserve and keep available, either in its treasury or out of it authorized but unissued shares of Common Stock, shares of Common Stock equal to the full number of unvested restricted stock units subject to the Award from time to time.

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5.8 Agreement Subject to the Plan; Section 409A of the Code.  This Agreement is subject to the provisions of the Plan (including the adjustment provision set forth in Section 7(b) thereof) and shall be interpreted in accordance therewith.  The Employee hereby acknowledges receipt of a copy of the Plan.  This Agreement shall be interpreted and construed in a manner that avoids the imposition of taxes and other penalties under Section 409A of the Code.  The Company reserves the right to amend this Agreement to the extent it determines in its sole discretion such amendment is necessary or appropriate to comply with applicable law, including but not limited to Section 409A of the Code.  Notwithstanding the foregoing, under no circumstances shall the Company be responsible for any taxes, penalties, interest or other losses or expenses incurred by the Employee due to any failure to comply with Section 409A of the Code.    

6. Miscellaneous Provisions.

6.1 Meaning of Certain Terms.  As used herein, employment by the Company shall include employment by an Affiliate of the Company.

6.2 Successors.  This Agreement shall be binding upon and inure to the benefit of any successor or successors of the Company and any person or persons who shall, upon the death of the Employee, acquire any rights hereunder in accordance with this Agreement or the Plan.

6.3 Notices.  All notices, requests or other communications provided for in this Agreement shall be made in writing by (a) actual delivery to the party entitled thereto, (b) mailing to the last known address of the party entitled thereto, via certified or registered mail, return receipt requested or (c) telecopy with confirmation of receipt.  The notice, request or other communication shall be deemed to be received, in the case of actual delivery, on the date of its actual receipt by the party entitled thereto, in the case of mailing, on the tenth calendar day following the date of such mailing, and in the case of telecopy, on the date of confirmation of receipt; provided, however, that if a notice, request or other communication is not received during regular business hours, it shall be deemed to be received on the next succeeding business day of the Company.

6.4 Governing Law.  This Agreement and all determinations made and actions taken pursuant hereto, to the extent not otherwise governed by the laws of the United States, shall be governed by the laws of the State of Delaware and construed in accordance therewith without giving effect to conflicts of laws principles.

APTARGROUP, INC.
By:	[Authorized Representative]

Acknowledgment, Acceptance and Agreement:

By accepting this grant on the Company’s stock plan administrator’s website, I hereby accept the restricted stock units granted to me and acknowledge and agree to be bound by the terms and conditions of the Agreement and the Plan as amended by the Sub-Plan.

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EX-31.1

Exhibit 31.1

CERTIFICATION

I, Stephan B. Tanda, certify that:

1. I have reviewed this quarterly report on Form 10-Q of AptarGroup, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a--15(e) and 15d--15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a--15(f) and 15d--15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	May 1, 2020
By:	/s/ STEPHAN B. TANDA
	Stephan B. Tanda
	President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Robert W. Kuhn, certify that:

1. I have reviewed this quarterly report on Form 10-Q of AptarGroup, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a--15(e) and 15d--15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a--15(f) and 15d--15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	May 1, 2020
By:	/s/ ROBERT W. KUHN
	Robert W. Kuhn
	Executive Vice President,
	Chief Financial Officer and Secretary

EX-32.1

Exhibit 32.1

Certificate Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

I, Stephan B. Tanda, president and chief executive officer of AptarGroup, Inc., certify that (i) the Quarterly Report on Form 10-Q of AptarGroup, Inc. for the quarter ended March  31, 2020 (the “Form 10-Q”) fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and (ii) the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of AptarGroup, Inc.

By:	/s/ STEPHAN B. TANDA
	Stephan B. Tanda
	President and Chief Executive Officer
	May 1, 2020

EX-32.2

Exhibit 32.2

Certificate Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

I, Robert W. Kuhn, executive vice president and chief financial officer and secretary of AptarGroup, Inc., certify that (i) the Quarterly Report on Form 10-Q of AptarGroup, Inc. for the quarter ended March  31, 2020 (the “Form 10-Q”) fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and (ii) the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of AptarGroup, Inc.

By:	/s/ ROBERT W. KUHN
	Robert W. Kuhn
	Executive Vice President,
	Chief Financial Officer and Secretary
	May 1, 2020

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SUBSEQUENT EVENTS (Details) - Subsequent Events - Fusion Packaging $ in Millions	Apr. 01, 2020 USD ($)
Subsequent Event [Line Items]
Percentage of interest acquired	100.00%
Cost of acquired entity	$ 165

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ACCUMULATED OTHER COMPREHENSIVE INCOME (Reclassifications From Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Amount Reclassified from Accumulated Other Comprehensive Income
Miscellaneous, net	$ (1,412)	$ 466
Interest expense	8,388	9,214
Total before tax	(78,036)	(89,999)
Tax benefit	22,786	27,000
Total reclassifications for the period	(55,253)	(63,004)
Amount Reclassified from Accumulated Other Comprehensive Income
Amount Reclassified from Accumulated Other Comprehensive Income
Total reclassifications for the period	(1,907)	(5,410)
Defined Benefit Pension Plans | Amount Reclassified from Accumulated Other Comprehensive Income
Amount Reclassified from Accumulated Other Comprehensive Income
Amortization of net loss	2,062	852
Amortization of prior service cost	97	113
Total before tax	2,159	965
Tax benefit	(523)	(244)
Total reclassifications for the period	1,636	721
Derivatives | Amount Reclassified from Accumulated Other Comprehensive Income
Amount Reclassified from Accumulated Other Comprehensive Income
Total reclassifications for the period	(3,543)	(6,131)
Derivatives | Cross Currency Swap Contract: Interest Component | Amount Reclassified from Accumulated Other Comprehensive Income
Amount Reclassified from Accumulated Other Comprehensive Income
Interest expense	(763)	(1,454)
Derivatives | Cross Currency Swap Contract: Foreign Exchange Component | Amount Reclassified from Accumulated Other Comprehensive Income
Amount Reclassified from Accumulated Other Comprehensive Income
Miscellaneous, net	$ (2,780)	$ (4,677)

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LEASE COMMITMENTS - Components of Lease Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Components of lease expense:
Operating lease cost	$ 5,254	$ 6,004
Finance lease cost:
Amortization of right-of-use assets	1,199	872
Interest on lease liabilities	348	315
Total finance lease cost	1,547	1,187
Short-term lease and variable lease costs	$ 2,448	$ 1,942

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GOODWILL AND OTHER INTANGIBLE ASSETS (Summary of Intangible Assets) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Amortized intangible assets:
Gross Carrying Amount	$ 372,438		$ 372,417
Accumulated Amortization	(88,317)		(81,333)
Net Value	284,121		291,084
Aggregate amortization expense	8,014	$ 6,002
Future estimated amortization expense
2020	20,725
2021	27,154
2022	26,915
2023	26,835
2024 and thereafter	$ 182,492
Weighted Average
Amortized intangible assets:
Amortization Period	13 years
Patents
Amortized intangible assets:
Gross Carrying Amount	$ 3,001		2,804
Accumulated Amortization	(1,304)		(1,318)
Net Value	$ 1,697		1,486
Patents | Weighted Average
Amortized intangible assets:
Amortization Period	7 years 10 months 24 days
Acquired technology
Amortized intangible assets:
Gross Carrying Amount	$ 99,437		100,511
Accumulated Amortization	(27,143)		(25,430)
Net Value	$ 72,294		75,081
Acquired technology | Weighted Average
Amortized intangible assets:
Amortization Period	13 years
Customer relationships
Amortized intangible assets:
Gross Carrying Amount	$ 216,198		217,934
Accumulated Amortization	(37,774)		(33,924)
Net Value	$ 178,424		184,010
Customer relationships | Weighted Average
Amortized intangible assets:
Amortization Period	13 years 8 months 12 days
Trademarks and trade names
Amortized intangible assets:
Gross Carrying Amount	$ 34,131		35,015
Accumulated Amortization	(11,919)		(11,003)
Net Value	$ 22,212		24,012
Trademarks and trade names | Weighted Average
Amortized intangible assets:
Amortization Period	6 years 10 months 24 days
License agreements and other
Amortized intangible assets:
Gross Carrying Amount	$ 19,671		16,153
Accumulated Amortization	(10,177)		(9,658)
Net Value	$ 9,494		$ 6,495
License agreements and other | Weighted Average
Amortized intangible assets:
Amortization Period	17 years 7 months 6 days

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INVENTORIES (Tables)

3 Months Ended

Mar. 31, 2020

INVENTORIES

Schedule of inventories, by component

	March 31,		December 31,
	2020		2019
Raw materials	$	106,787	$	111,653
Work in process		120,151		123,750
Finished goods		144,921		140,392
Total	$	371,859	$	375,795

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RETIREMENT AND DEFERRED COMPENSATION PLANS (Tables)

3 Months Ended

Mar. 31, 2020

RETIREMENT AND DEFERRED COMPENSATION PLANS

Components of net periodic benefit cost

	Domestic Plans				Foreign Plans
Three Months Ended March 31,	2020		2019		2020		2019
Service cost	$	3,577	$	2,773	$	1,768	$	1,460
Interest cost		1,987		1,845		340		501
Expected return on plan assets		(3,422)		(3,094)		(634)		(592)
Amortization of net loss		1,548		489		514		363
Amortization of prior service cost		—		—		97		113
Net periodic benefit cost	$	3,690	$	2,013	$	2,085	$	1,845

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STOCK-BASED COMPENSATION (Tables)

3 Months Ended

Mar. 31, 2020

STOCK-BASED COMPENSATION

Summary of option activity

	Stock Awards Plans					Director Stock Option Plans
			Weighted Average				Weighted Average
		Options	Exercise Price			Options	Exercise Price
Outstanding, January 1, 2020		5,044,180	$	68.32		135,251	$	58.45
Granted		—		—		—		—
Exercised		(292,090)		55.16		(21,251)		51.20
Forfeited or expired		(6,630)		65.60		—		—
Outstanding at March 31, 2020		4,745,460	$	69.20		114,000	$	59.80
Exercisable at March 31, 2020		4,583,864	$	68.43		114,000	$	59.80
Weighted-Average Remaining Contractual Term (Years):
Outstanding at March 31, 2020		5.3				3.2
Exercisable at March 31, 2020		5.1				3.2
Aggregate Intrinsic Value:
Outstanding at March 31, 2020	$	143,971			$	4,530
Exercisable at March 31, 2020	$	142,195			$	4,530
Intrinsic Value of Options Exercised During the Three Months Ended:
March 31, 2020	$	18,202			$	1,385
March 31, 2019	$	14,047			$	51

Weighted-average assumptions used to estimate fair value of restricted stock units

Three Months Ended March 31,		2020			2019
Fair value per stock award	$	94.98		$	134.97
Grant date stock price	$	83.93		$	104.51
Assumptions:
Aptar's stock price expected volatility		23.80	%		16.50	%
Expected average volatility of peer companies		48.50	%		31.90	%
Correlation assumption		63.50	%		37.40	%
Risk-free interest rate		0.31	%		2.19	%
Dividend yield assumption		1.72	%		1.30	%

Summary of restricted stock unit activity

	Time-Based RSUs			Performance-Based RSUs
		Weighted Average			Weighted Average
	Units	Grant-Date Fair Value		Units	Grant-Date Fair Value
Nonvested at January 1, 2020	480,729	$	95.45	181,680	$	117.26
Granted	176,424		81.75	206,408		90.85
Vested	(112,515)		82.64	—		—
Forfeited	(217)		100.14	(589)		120.61
Nonvested at March 31, 2020	544,421	$	92.11	387,499	$	103.23

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RETIREMENT AND DEFERRED COMPENSATION PLANS

3 Months Ended

Mar. 31, 2020

RETIREMENT AND DEFERRED COMPENSATION PLANS

RETIREMENT AND DEFERRED COMPENSATION PLANS

NOTE 8 – RETIREMENT AND DEFERRED COMPENSATION PLANS

Components of Net Periodic Benefit Cost:

	Domestic Plans				Foreign Plans
Three Months Ended March 31,	2020		2019		2020		2019
Service cost	$	3,577	$	2,773	$	1,768	$	1,460
Interest cost		1,987		1,845		340		501
Expected return on plan assets		(3,422)		(3,094)		(634)		(592)
Amortization of net loss		1,548		489		514		363
Amortization of prior service cost		—		—		97		113
Net periodic benefit cost	$	3,690	$	2,013	$	2,085	$	1,845

The components of net periodic benefit cost, other than the service cost component, are included in the line “Miscellaneous, net” in the income statement.

EMPLOYER CONTRIBUTIONS

Although we have no minimum funding requirement, we contributed $204 thousand to our ongoing domestic supplemental employee retirement plan (“SERP”) annuity contracts during the three months ended March 31, 2020. We plan to contribute approximately an additional $200 thousand to pay our ongoing SERP annuity contracts during 2020. We have contributed approximately $711 thousand to our foreign defined benefit plans during the three months ended March 31, 2020 and do not expect additional significant contributions during 2020.

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GOODWILL AND OTHER INTANGIBLE ASSETS

3 Months Ended

Mar. 31, 2020

GOODWILL AND OTHER INTANGIBLE ASSETS

GOODWILL AND OTHER INTANGIBLE ASSETS

NOTE 4 – GOODWILL AND OTHER INTANGIBLE ASSETS

The changes in the carrying amount of goodwill by reporting segment since December 31, 2019 are as follows:

	Beauty +				Food +		Corporate
	Home		Pharma		Beverage		& Other		Total
Goodwill	$	221,658	$	413,650	$	128,153	$	1,615	$	765,076
Accumulated impairment losses		—		—		—		(1,615)		(1,615)
Balance as of December 31, 2019	$	221,658	$	413,650	$	128,153	$	—	$	763,461
Acquisition		—		463		—		—		463
Foreign currency exchange effects		(2,201)		(5,543)		(99)		—		(7,843)
Goodwill	$	219,457	$	408,570	$	128,054	$	1,615	$	757,696
Accumulated impairment losses		—		—		—		(1,615)		(1,615)
Balance as of March 31, 2020	$	219,457	$	408,570	$	128,054	$	—	$	756,081

The table below shows a summary of intangible assets as of March 31, 2020 and December 31, 2019.

		March 31, 2020							December 31, 2019
Weighted Average		Gross						Gross
Amortization Period		Carrying		Accumulated		Net		Carrying		Accumulated		Net
	(Years)	Amount		Amortization		Value		Amount		Amortization		Value
Amortized intangible assets:
Patents	7.9	$	3,001		(1,304)	$	1,697	$	2,804	$	(1,318)	$	1,486
Acquired technology	13.0		99,437		(27,143)		72,294		100,511		(25,430)		75,081
Customer relationships	13.7		216,198		(37,774)		178,424		217,934		(33,924)		184,010
Trademarks and trade names	6.9		34,131		(11,919)		22,212		35,015		(11,003)		24,012
License agreements and other	17.6		19,671		(10,177)		9,494		16,153		(9,658)		6,495
Total intangible assets	13.0	$	372,438	$	(88,317)	$	284,121	$	372,417	$	(81,333)	$	291,084

Aggregate amortization expense for the intangible assets above for the quarters ended March 31, 2020 and 2019 was $8,014 and $6,002, respectively.

Future estimated amortization expense for the years ending December 31 is as follows:

2020	$	20,725	(remaining estimated amortization for 2020)
2021		27,154
2022		26,915
2023		26,835
2024 and thereafter		182,492

Future amortization expense may fluctuate depending on changes in foreign currency rates. The estimates for amortization expense noted above are based upon foreign exchange rates as of March 31, 2020.

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SUBSEQUENT EVENTS

3 Months Ended

Mar. 31, 2020

SUBSEQUENT EVENTS.

SUBSEQUENT EVENTS

NOTE 20 – SUBSEQUENT EVENTS

On April 1, 2020, the Fusion Acquisition closed for an approximate purchase price of $165 million, plus an earn-out, to acquire 100% of the membership interests. Refer to Note 17 – Acquisitions for further details on the acquisition.

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CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Net sales	$ 721,553	$ 744,460
Operating Expenses:
Cost of sales (exclusive of depreciation and amortization shown below)	451,256	469,132
Selling, research & development and administrative	126,192	121,215
Depreciation and amortization	50,806	47,489
Restructuring initiatives	4,839	9,530
Total Operating Expenses	633,093	647,366
Operating Income	88,460	97,094
Other (Expense) Income:
Interest expense	(8,388)	(9,214)
Interest income	175	1,748
Equity in results of affiliates	(799)	(95)
Miscellaneous, net	(1,412)	466
Total Other Income (Expense)	(10,424)	(7,095)
Income before Income Taxes	78,036	89,999
Provision for Income Taxes	22,786	27,000
Net Income	55,250	62,999
Net (Income) Loss Attributable to Noncontrolling Interests	3	5
Net Income Attributable to AptarGroup, Inc.	$ 55,253	$ 63,004
Net Income Attributable to AptarGroup, Inc. Per Common Share:
Basic (in dollars per share)	$ 0.86	$ 1.00
Diluted (in dollars per share)	$ 0.84	$ 0.96
Average number of shares outstanding:
Basic (in shares)	64,009	62,964
Diluted (in shares)	66,111	65,349
Dividends per Common Share (in dollars per share)	$ 0.36	$ 0.34

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CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands	Retained Earnings	Accumulated Other Comprehensive Income/(Loss)	Common Stock Par Value	Treasury Stock	Capital in Excess of Par Value	Non-Controlling Interest	Total
Balance at Dec. 31, 2018	$ 1,371,826	$ (310,504)	$ 673	$ (318,208)	$ 678,769	$ 315	$ 1,422,871
Increase (Decrease) in Stockholders' Equity
Net Income	63,004					(5)	62,999
Foreign currency translation adjustments		(9,619)				8	(9,611)
Changes in unrecognized pension gains (losses) and related amortization, net of tax		721					721
Changes in derivative gains (losses), net of tax		(393)					(393)
Stock awards and option exercises			3	5,337	22,164		27,504
Cash dividends declared on common stock	(21,377)						(21,377)
Treasury stock purchased				(15,000)			(15,000)
Balance at Mar. 31, 2019	1,413,453	(319,795)	676	(327,871)	700,933	318	1,467,714
Balance at Dec. 31, 2019	1,523,820	(341,948)	686	(381,238)	770,596	336	1,572,252
Increase (Decrease) in Stockholders' Equity
Net Income	55,253					(3)	55,250
Adoption of accounting standards | Accounting Standards Update 2016-13	(1,377)						(1,377)
Foreign currency translation adjustments		(42,229)					(42,229)
Changes in unrecognized pension gains (losses) and related amortization, net of tax		1,636					1,636
Changes in derivative gains (losses), net of tax		1,483					1,483
Stock awards and option exercises			3	8,665	14,971		23,639
Cash dividends declared on common stock	(23,031)						(23,031)
Balance at Mar. 31, 2020	$ 1,554,665	$ (381,058)	$ 689	$ (372,573)	$ 785,567	$ 333	$ 1,587,623

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SEGMENT INFORMATION

3 Months Ended

Mar. 31, 2020

SEGMENT INFORMATION

SEGMENT INFORMATION

NOTE 16 – SEGMENT INFORMATION

We are organized into three reporting segments. Our Beauty + Home segment sells to the personal care, beauty and home care markets. Our Pharma segment serves customers in the prescription drug, consumer health care, injectables and active packaging markets. Our Food + Beverage segment sells to the food and beverage markets.

The accounting policies of the segments are the same as those described in Part II, Item 8, Note 1 - Summary of Significant Accounting Policies in our Annual Report on Form 10-K for the year ended December 31, 2019. We evaluate performance of our business units and allocate resources based upon Adjusted EBITDA. Adjusted EBITDA is defined as earnings before net interest, taxes, depreciation, amortization, unallocated corporate expenses, restructuring and acquisition-related costs. All internal segment reporting and discussions of results with our Chief Operating Decision Maker (CODM) are based on segment Adjusted EBITDA.

Financial information regarding our reporting segments is shown below:

Three Months Ended March 31,	2020		2019
Total Sales:
Beauty + Home	$	330,466	$	373,503
Pharma		299,590		274,494
Food + Beverage		100,301		104,727
Total Sales	$	730,357	$	752,724
Less: Intersegment Sales:
Beauty + Home	$	5,906	$	5,844
Pharma		2,394		1,793
Food + Beverage		504		627
Total Intersegment Sales	$	8,804	$	8,264
Net Sales:
Beauty + Home	$	324,560	$	367,659
Pharma		297,196		272,701
Food + Beverage		99,797		104,100
Net Sales	$	721,553	$	744,460
Adjusted EBITDA (1):
Beauty + Home	$	34,247	$	53,191
Pharma		108,342		97,357
Food + Beverage		15,407		16,691
Corporate & Other, unallocated		(13,828)		(12,755)
Acquisition-related costs (2)		(2,274)		—
Restructuring Initiatives (3)		(4,839)		(9,530)
Depreciation and amortization		(50,806)		(47,489)
Interest Expense		(8,388)		(9,214)
Interest Income		175		1,748
Income before Income Taxes	$	78,036	$	89,999

(1) We evaluate performance of our reporting segments and allocate resources based upon Adjusted EBITDA. Adjusted EBITDA is defined as earnings before net interest, taxes, depreciation, amortization, unallocated corporate expenses, restructuring and acquisition-related costs.

(2) Acquisition-related costs include transaction costs and purchase accounting adjustments related to acquisitions and investments (see Note 17 – Acquisitions and Note 18 – Investment in Equity Securities for further details).

(3) Restructuring Initiatives includes expense items for the three months ended March 31, 2020 and 2019 as follows (see Note 19 – Restructuring Initiatives for further details):

Three Months Ended March 31,	2020		2019
Restructuring Initiatives by Segment
Beauty + Home	$	4,907	$	8,269
Pharma		(31)		326
Food + Beverage		103		510
Corporate & Other		(140)		425
Total Restructuring Initiatives	$	4,839	$	9,530

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COMMITMENTS AND CONTINGENCIES

3 Months Ended

Mar. 31, 2020

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

NOTE 12 - COMMITMENTS AND CONTINGENCIES

The Company, in the normal course of business, is subject to a number of lawsuits and claims both actual and potential in nature. While management believes the resolution of these claims and lawsuits will not have a material adverse effect on our financial position, results of operations or cash flows, claims and legal proceedings are subject to inherent uncertainties, and unfavorable outcomes could occur and could include amounts in excess of any accruals which management has established. Were such unfavorable final outcomes to occur, it is possible that they could have a material adverse effect on our financial position, results of operations and cash flows.

Under our Certificate of Incorporation, we have agreed to indemnify our officers and directors for certain events or occurrences while the officer or director is, or was, serving at our request in such capacity. The maximum potential amount of future payments we could be required to make under these indemnification agreements is unlimited; however, we have a directors and officers liability insurance policy that covers a portion of our exposure. As a result of our insurance policy coverage, we believe the estimated fair value of these indemnification agreements is minimal. We have no liabilities recorded for these agreements as of March 31, 2020 and December 31, 2019.

A fire caused damage to our facility in Annecy, France in June 2016. We are insured for the damages caused by the fire, including business interruption insurance.  For the three months ended March 31, 2020, we did not receive any insurance proceeds, and have no insurance receivable as of March 31, 2020. During the three months ended March 31, 2020 and 2019, profitability was not impacted. The final settlement continues to be negotiated. In many cases, our insurance coverage exceeds the amount of our recognized losses. However, no gain contingencies were recognized during the three months ended March 31, 2020 as our ability to realize those gains remains uncertain.

An environmental investigation, undertaken to assess areas of possible contamination, was completed at our facility in Jundiaí, São Paulo, Brazil. The facility is primarily an internal supplier of anodized aluminum components for certain of our dispensing systems. The testing indicated that soil and groundwater in certain areas of the facility were impacted above acceptable levels established by local regulations. In March 2017, we reported the findings to the relevant environmental authority, the Environmental Company of the State of São Paulo – CETESB. Based upon our best estimate, we recorded a reserve of $1.5 million (operating expense) in the first quarter of 2017 related to this contingency. During 2019, we paid approximately $0.6 million. For the three months ended March 31, 2020, we paid approximately $0.1 million and made adjustments to the accrual based on our future anticipated expenditures.  As of March 31, 2020, our outstanding reserve is $0.4 million. The ultimate loss associated with this environmental contingency is subject to the investigation and ongoing review of the CETESB. We will continue to evaluate the range of likely costs as the investigation proceeds and we have further clarity on the nature and extent of remediation that will be required. We note that the contamination, or any failure to complete any required remediation in a timely manner, could potentially result in fines or penalties.

In March 2017, the Supreme Court of Brazil issued a decision that a certain state value added tax should not be included in the calculation of federal gross receipts taxes. The decision reduces our gross receipts tax in Brazil prospectively and, potentially, retrospectively. During the first quarter of 2019, we received a favorable court decision of $2.7 million for the retrospective right to recover part of our claim. This amount is recorded in cost of sales as a favorable impact of $1.7 million and $1.0 million was recognized as interest income. If the Judicial Court grants full retrospective recovery, we estimate remaining potential recoveries of approximately $2 million to $8 million, including interest, depending on the future decisions of the Supreme Court of Brazil. Due to uncertainties around our remaining court recovery claims, we have not recorded any further amounts relating to the retrospective nature of this matter.

In December 2019, tax authorities in Brazil notified us of a tax assessment of approximately $6.1 million, including interest and penalties of $2.3 million and $0.8 million, respectively, relating to differences in tax classification codes used for import duties for the period from January 2015 to August 2018. We are vigorously contesting the assessment, including interest and penalties, and have filed an administrative defense appeal in December 2019. Considering the complex nature of the assessment, we expect the appeal process to go through different levels of administrative and/or judicial review. Accordingly, due to uncertainty of the timing and amounts of assessment, no liability is recorded as of March 31, 2020.

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STOCK-BASED COMPENSATION (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
STOCK-BASED COMPENSATION
Proceeds from stock option exercises	$ 18,602	$ 20,939
Stock options
STOCK-BASED COMPENSATION
Award vesting period	3 years
Expiration period	10 years
Compensation expense	$ 900	1,800
Compensation expense, net of tax	700	1,500
Fair value of shares vested	7,600	12,200
Proceeds from stock option exercises	18,600
Actual tax benefit realized for the tax deduction from option exercises	4,800
Unrecognized compensation cost expected to be recognized in future periods	$ 1,500
Weighted-average period over which compensation cost is expected to be recognized	10 months 24 days
Stock options | Selling, research & development and administrative expenses
STOCK-BASED COMPENSATION
Compensation expense	$ 700	1,600
Restricted stock units
STOCK-BASED COMPENSATION
Compensation expense	8,300	4,700
Actual tax benefit realized for the tax deduction from option exercises	1,500
Unrecognized compensation cost expected to be recognized in future periods	$ 62,700
Weighted-average period over which compensation cost is expected to be recognized	2 years 3 months 18 days
Weighted-Average Grant-Date Fair Value
Fair value of units vested	$ 9,300	2,700
Intrinsic value of units vested	$ 11,500	$ 3,200
Restricted stock units (time-based)
STOCK-BASED COMPENSATION
Award vesting period	3 years
Restricted stock unit activity
Balance at the beginning of the period (in shares)	480,729
Granted (in shares)	176,424
Vested (in shares)	(112,515)
Forfeited (in shares)	(217)
Balance at the end of the period (in shares)	544,421
Weighted-Average Grant-Date Fair Value
Nonvested at the beginning of the period (in dollars per share)	$ 95.45
Granted (in dollars per share)	81.75
Vested (in dollars per share)	82.64
Forfeited (in dollars per share)	100.14
Nonvested at the end of the period (in dollars per share)	$ 92.11
Restricted stock units (performance-based)
STOCK-BASED COMPENSATION
Award vesting period	3 years
Assumptions used to estimate fair value of stock options granted
Dividend Yield (as a percent)	1.72%	1.30%
Expected Stock Price Volatility (as a percent)	23.80%	16.50%
Risk-free Interest Rate (as a percent)	0.31%	2.19%
Assumptions used to estimate fair value of restricted stock units granted
Fair value per stock award (in dollars per share)	$ 94.98	$ 134.97
Grant date stock price (in dollars per share)	$ 83.93	$ 104.51
Expected Stock Price Volatility (as a percent)	23.80%	16.50%
Expected average volatility of peer companies (as a percent)	48.50%	31.90%
Correlation assumption (as a percent)	63.50%	37.40%
Risk-free Interest Rate (as a percent)	0.31%	2.19%
Dividend Yield (as a percent)	1.72%	1.30%
Restricted stock unit activity
Balance at the beginning of the period (in shares)	181,680
Granted (in shares)	206,408
Forfeited (in shares)	(589)
Balance at the end of the period (in shares)	387,499
Weighted-Average Grant-Date Fair Value
Nonvested at the beginning of the period (in dollars per share)	$ 117.26
Granted (in dollars per share)	90.85
Forfeited (in dollars per share)	120.61
Nonvested at the end of the period (in dollars per share)	$ 103.23
Stock Awards Plans | Stock options
Stock options activity
Outstanding at the beginning of the period (in shares)	5,044,180
Exercised (in shares)	(292,090)
Forfeited or expired (in shares)	(6,630)
Outstanding at the end of the period (in shares)	4,745,460
Exercisable at the end of the period (in shares)	4,583,864
Weighted Average Exercise Price
Outstanding at the beginning of the period (in dollars per share)	$ 68.32
Exercised (in dollars per share)	55.16
Forfeited or expired (in dollars per share)	65.60
Outstanding at the end of the period (in dollars per share)	69.20
Exercisable at the end of the period (in dollars per share)	$ 68.43
Weighted-Average Remaining Contractual Term (Years):
Outstanding at the end of the period	5 years 3 months 18 days
Exercisable at the end of the period	5 years 1 month 6 days
Aggregate Intrinsic Value:
Outstanding at the end of the period	$ 143,971
Exercisable at the end of the period	142,195
Intrinsic Value of Options Exercised	$ 18,202	$ 14,047
Director Stock Option Plans | Stock options
Stock options activity
Outstanding at the beginning of the period (in shares)	135,251
Exercised (in shares)	(21,251)
Outstanding at the end of the period (in shares)	114,000
Exercisable at the end of the period (in shares)	114,000
Weighted Average Exercise Price
Outstanding at the beginning of the period (in dollars per share)	$ 58.45
Exercised (in dollars per share)	51.20
Outstanding at the end of the period (in dollars per share)	59.80
Exercisable at the end of the period (in dollars per share)	$ 59.80
Weighted-Average Remaining Contractual Term (Years):
Outstanding at the end of the period	3 years 2 months 12 days
Exercisable at the end of the period	3 years 2 months 12 days
Aggregate Intrinsic Value:
Outstanding at the end of the period	$ 4,530
Exercisable at the end of the period	4,530
Intrinsic Value of Options Exercised	$ 1,385	$ 51
Director Stock Option Plans | Restricted stock units
STOCK-BASED COMPENSATION
Award vesting period	1 year
Director Stock Option Plans | Restricted stock units (time-based)
Restricted stock unit activity
Granted (in shares)	11,490

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Schedule of Derivative Assets and Liabilities) (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Derivative Assets
Gross Amount	$ 8,830	$ 2,758
Net Amounts Presented in the Statement of Financial Position	8,830	2,758
Net Amount	8,830	2,758
Derivative Liabilities
Gross Amount	505	401
Net Amounts Presented in the Statement of Financial Position	505	401
Net Amount	$ 505	$ 401

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SEGMENT INFORMATION (Tables)

3 Months Ended

Mar. 31, 2020

SEGMENT INFORMATION

Financial information regarding the Company's reportable segments

Financial information regarding our reporting segments is shown below:

Three Months Ended March 31,	2020		2019
Total Sales:
Beauty + Home	$	330,466	$	373,503
Pharma		299,590		274,494
Food + Beverage		100,301		104,727
Total Sales	$	730,357	$	752,724
Less: Intersegment Sales:
Beauty + Home	$	5,906	$	5,844
Pharma		2,394		1,793
Food + Beverage		504		627
Total Intersegment Sales	$	8,804	$	8,264
Net Sales:
Beauty + Home	$	324,560	$	367,659
Pharma		297,196		272,701
Food + Beverage		99,797		104,100
Net Sales	$	721,553	$	744,460
Adjusted EBITDA (1):
Beauty + Home	$	34,247	$	53,191
Pharma		108,342		97,357
Food + Beverage		15,407		16,691
Corporate & Other, unallocated		(13,828)		(12,755)
Acquisition-related costs (2)		(2,274)		—
Restructuring Initiatives (3)		(4,839)		(9,530)
Depreciation and amortization		(50,806)		(47,489)
Interest Expense		(8,388)		(9,214)
Interest Income		175		1,748
Income before Income Taxes	$	78,036	$	89,999

(1) We evaluate performance of our reporting segments and allocate resources based upon Adjusted EBITDA. Adjusted EBITDA is defined as earnings before net interest, taxes, depreciation, amortization, unallocated corporate expenses, restructuring and acquisition-related costs.

(2) Acquisition-related costs include transaction costs and purchase accounting adjustments related to acquisitions and investments (see Note 17 – Acquisitions and Note 18 – Investment in Equity Securities for further details).

(3) Restructuring Initiatives includes expense items for the three months ended March 31, 2020 and 2019 as follows (see Note 19 – Restructuring Initiatives for further details):

Three Months Ended March 31,	2020		2019
Restructuring Initiatives by Segment
Beauty + Home	$	4,907	$	8,269
Pharma		(31)		326
Food + Beverage		103		510
Corporate & Other		(140)		425
Total Restructuring Initiatives	$	4,839	$	9,530

Restructuring Initiatives

Three Months Ended March 31,	2020		2019
Restructuring Initiatives by Segment
Beauty + Home	$	4,907	$	8,269
Pharma		(31)		326
Food + Beverage		103		510
Corporate & Other		(140)		425
Total Restructuring Initiatives	$	4,839	$	9,530

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2020 USD ($) segment $ / shares	Mar. 31, 2019 USD ($) shares	Jan. 01, 2020 USD ($)	Dec. 31, 2019 USD ($) $ / shares
Number of reportable segments | segment	3
Total Restructuring Initiatives	$ 4,839	$ 9,530
INVESTMENTS IN EQUITY SECURITIES
Proceeds from sale of investment in equity securities		$ 16,487
Investment in unconsolidated affiliate	20,423
GOODWILL
Impairment of goodwill	$ 0
RETIREMENT OF COMMON STOCK
Common stock repurchased (retired and held in treasury) (in shares) | shares		159
Common stock, par value (in dollars per share) | $ / shares	$ 0.01			$ 0.01
ADOPTION OF RECENT ACCOUNTING PRONOUNCEMENTS
Retained earnings	$ 1,554,665			$ 1,523,820
Adjustment | Accounting Standards Update 2016-13
ADOPTION OF RECENT ACCOUNTING PRONOUNCEMENTS
Retained earnings			$ (1,400)
Beauty + Home
Total Restructuring Initiatives	4,907	$ 8,269
Pharma
Total Restructuring Initiatives	(31)	326
Food + Beverage
Total Restructuring Initiatives	103	510
Corporate & Other
Total Restructuring Initiatives	(140)	425
Business Transformation
Total Restructuring Initiatives	$ 4,800	$ 9,500

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GOODWILL AND OTHER INTANGIBLE ASSETS (Schedule of Goodwill) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Dec. 31, 2019
Changes in the carrying amount of goodwill
Goodwill	$ 757,696	$ 765,076
Accumulated impairment losses	(1,615)	(1,615)
Goodwill, Total	756,081	763,461
Acquisition	463
Foreign currency exchange effects	(7,843)
Impairment of goodwill	0
Operating segment | Beauty + Home
Changes in the carrying amount of goodwill
Goodwill	219,457	221,658
Goodwill, Total	219,457	221,658
Foreign currency exchange effects	(2,201)
Operating segment | Pharma
Changes in the carrying amount of goodwill
Goodwill	408,570	413,650
Goodwill, Total	408,570	413,650
Acquisition	463
Foreign currency exchange effects	(5,543)
Operating segment | Food + Beverage
Changes in the carrying amount of goodwill
Goodwill	128,054	128,153
Goodwill, Total	128,054	128,153
Foreign currency exchange effects	(99)
Corporate Non-Segment
Changes in the carrying amount of goodwill
Goodwill	1,615	1,615
Accumulated impairment losses	$ (1,615)	$ (1,615)

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ACQUISITIONS

3 Months Ended

Mar. 31, 2020

ACQUISITIONS

ACQUISITIONS

NOTE 17 – ACQUISITIONS

Business Combinations

On February 13, 2020, we entered into a securities purchase agreement to acquire 100% of the equity interests (the “Fusion Acquisition”) of Fusion Packaging, Inc. (“Fusion”). Subsequent to the quarter end, on April 1, 2020 we closed on the Fusion Acquisition for a purchase price of approximately $165 million. Fusion, based in Dallas, TX, is a global leader in the design, engineering and distribution of luxury packaging for the beauty industry. The purchase agreement also provides an earn-out provision providing for the payment of up to $33.9 million based on Fusion’s financial performance during a 3 year measurement period.

On October 31, 2019, we completed our acquisition (the “Noble Acquisition”) of 100% of the equity interests of Noble International Holdings, Inc., Genia Medical, Inc. and JBCB Holdings, LLC (collectively referred to as “Noble”). Noble, based in Orlando, FL, is a leading provider in developing patient-centric advanced drug delivery system training devices including autoinjector, prefilled syringe, onbody and respiratory devices for the world’s leading biopharmaceutical companies and original equipment manufacturers. The purchase price was approximately $62.3 million (net of $1.6 million of cash acquired) and was funded by cash on hand. As part of the Noble Acquisition, we are also obligated to pay to the selling equityholders of Noble certain contingent consideration based on 2024 cumulative financial performance metrics defined in the purchase agreement. Based on projection as of the acquisition date, we estimated the aggregate fair value for this contingent consideration arrangement to be $2.9 million utilizing the Black-Scholes valuation model. As of December 31, 2019, $5 million was held in restricted cash pending the finalization of a working capital adjustment and indemnity escrow. During the first quarter of 2020, $1.0 million related to the working capital escrow was released from restriction, resulting in an additional $463 thousand payment due to the seller and a corresponding increase to our purchase price and associated goodwill balance. The results of Noble’s operations have been included in the Condensed Consolidated Financial Statements within our Pharma segment since the date of acquisition.

On June 5, 2019, we completed our acquisition (the “Nanopharm Acquisition”) of all of the outstanding capital stock of Nanopharm Ltd. (“Nanopharm”). Nanopharm, located in Newport, UK, is a science-driven, leading provider of orally inhaled and nasal drug product design and development services. The purchase price was approximately $38.1 million (net of $1.8 million of cash acquired) and was funded by cash on hand. The results of Nanopharm’s operations have been included in the Condensed Consolidated Financial Statements within our Pharma segment since the date of acquisition.

On May 31, 2019, we completed our acquisition (the “Gateway Acquisition”) of all of the outstanding equity interests of Gateway Analytical LLC (“Gateway”). Gateway, located in Gibsonia, PA, provides industry-leading particulate detection and predictive analytical services to customers developing injectable medicines. The purchase price was approximately $7.0 million and was funded by cash on hand. As part of the Gateway Acquisition, we are also obligated to pay to the selling equityholder of Gateway certain contingent consideration based on 2020 and 2022 performance targets defined in the purchase agreement. Based on projections as of the acquisition date, we estimated the aggregate fair value for this contingent consideration arrangement to be $3.0 million. The results of Gateway’s operations have been included in the Condensed Consolidated Financial Statements within our Pharma segment since the date of acquisition.

The following table summarizes the assets acquired and liabilities assumed as of the acquisition date at estimated fair value.

	2019
Assets
Cash and equivalents	$	3,427
Accounts receivable		3,504
Prepaid and other		2,478
Property, plant and equipment		4,267
Goodwill		59,143
Intangible assets		52,980
Other miscellaneous assets		430
Liabilities
Accounts payable, accrued and other liabilities		5,388
Deferred income taxes		2,592
Deferred and other non-current liabilities		1,598
Net assets acquired	$	116,651

The following table is a summary of the fair value estimates of the acquired identifiable intangible assets and weighted-average useful lives as of the acquisition date:

	2019
	Weighted-Average	Estimated
	Useful Life	Fair Value
	(in years)	of Asset
Acquired technology	8	$	9,160
Customer relationships	11		39,379
Trademarks and trade names	4		2,457
License agreements and other	1		1,984
Total		$	52,980

Goodwill in the amount of $59.1 million was recorded related to the 2019 acquisitions which is included in the Pharma segment. Goodwill is calculated as the excess of the consideration transferred over the net assets acquired and represents the estimated future economic benefits arising from other assets acquired that could not be individually identified and separately recognized. Goodwill largely consists of leveraging our commercial presence in selling the Noble, Nanopharm and Gateway lines of products in markets where they did not previously operate and the abilities of the acquired companies to maintain their competitive advantage from a technical viewpoint. Goodwill will not be amortized, but will be tested for impairment at least annually. For 2019 acquisitions, goodwill of $29.6 million will be deductible for tax purposes.

Asset Acquisition

On August 2, 2019, we completed our asset acquisition (the “Bapco Acquisition”) of the remaining 80% ownership interest in the capital stock of Bapco Closures Holdings Limited (“Bapco”), for $3.8 million (net of $2.9 million of cash acquired). The 20% ownership investment previously held in Bapco is now included within the intangible assets acquired. Bapco, located in Leeds, UK, provides innovative closures sealing technology that provides package integrity and tamper evidence. The results of Bapco’s operations have been included in the Condensed Consolidated Financial Statements within our Food + Beverage segment since the date of acquisition.

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STOCK REPURCHASE PROGRAM

3 Months Ended

Mar. 31, 2020

STOCK REPURCHASE PROGRAM

STOCK REPURCHASE PROGRAM

NOTE 13 – STOCK REPURCHASE PROGRAM

On April 18, 2019, we announced a share repurchase authorization of up to $350 million of common stock. This authorization replaces previous authorizations and has no expiration date. We may repurchase shares through the open market, privately negotiated transactions or other programs, subject to market conditions.

During the three months ended March 31, 2020, we did not repurchase any shares. During the three months ended March 31, 2019, the Company repurchased approximately 159 thousand shares for approximately $15.0 million. As of March 31, 2020, there was $278.5 million of authorized share repurchases available to us.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

3 Months Ended

Mar. 31, 2020

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

BASIS OF PRESENTATION

The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of AptarGroup, Inc. and our subsidiaries. The terms “AptarGroup”, “Aptar”, “Company”, “we”, “us” or “our” as used herein refer to AptarGroup, Inc. and our subsidiaries. All significant intercompany accounts and transactions have been eliminated.

In the opinion of management, the unaudited Condensed Consolidated Financial Statements (the “Condensed Consolidated Financial Statements”) include all normal recurring adjustments necessary for a fair statement of consolidated financial position, results of operations, comprehensive income, changes in equity and cash flows for the interim periods presented. The accompanying Condensed Consolidated Financial Statements have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations, although we believe that the disclosures made are adequate to make the information presented not misleading. Also, certain financial position data included herein was derived from the audited Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2019 but does not include all disclosures required by U.S. GAAP. Accordingly, these Condensed Consolidated Financial Statements and related notes should be read in conjunction with the audited Consolidated Financial Statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019. The results of operations of any interim period are not necessarily indicative of the results that may be expected for the year.

There are many uncertainties regarding the current COVID-19 pandemic, including the scope of scientific and health issues, the anticipated duration of the pandemic and the extent of local and worldwide social, political and economic disruption it may cause. The pandemic has impacted our business, operations and financial results during the quarter ended March 31, 2020 including an overall reduction to net sales. No impairments were recorded as of March 31, 2020. While the disruption is currently expected to be temporary, there is uncertainty around the duration. Due to significant uncertainty surrounding the situation, our judgment regarding future results could change and therefore our results could be materially impacted.

INCOME TAXES

INCOME TAXES

We compute taxes on income in accordance with the tax rules and regulations of the many taxing authorities where the income is earned. The income tax rates imposed by these taxing authorities may vary substantially. Taxable income may differ from pre-tax income for financial accounting purposes. To the extent that these differences create timing differences between the tax basis of an asset or liability and our reported amount in the financial statements, an appropriate provision for deferred income taxes is made.

We maintain our assertion that the cash and distributable reserves at our non-U.S. affiliates are indefinitely reinvested.  Under current U.S. tax laws, all of our non-U.S. earnings are subject to U.S. taxation. We will provide for the necessary withholding and local income taxes when management decides that an affiliate should make a distribution. These decisions are made taking into consideration the financial requirements of the non-U.S. affiliates and the global cash management goals of the Company.

We provide a liability for the amount of unrecognized tax benefits from uncertain tax positions. This liability is provided whenever we determine that a tax benefit will not meet a more-likely-than-not threshold for recognition.

The Company is subject to taxation and files income tax returns in the U.S. federal jurisdiction and many state and foreign jurisdictions. The Company believes that an adequate provision has been made for any adjustments that may result from tax examinations. However, the outcome of tax audits cannot be predicted with certainty. If any issues addressed in the Company’s tax audits are resolved in a manner inconsistent with its expectations, the Company could be required to adjust its provision for income taxes in the period such resolution occurs. The resolution of each of these audits is not expected to be material to our Condensed Consolidated Financial Statements.

ADOPTION OF RECENT ACCOUNTING PRONOUNCEMENTS

ADOPTION OF RECENT ACCOUNTING STANDARDS

Changes to U.S. GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of Accounting Standards Updates (“ASUs”) to the FASB’s Accounting Standards Codification.

Effective January 1, 2020, we adopted ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, issued by the FASB in June 2016, as well as the clarifying amendments subsequently issued. We applied the guidance using a modified retrospective approach and accordingly recognized an amount of $1.4 million as the cumulative adjustment to opening retained earnings in the first quarter of 2020. This is based on management's best estimates of specific losses on individual exposures particularly on current trade receivables, as well as the time value of money and reasonable and supportable information that is available at the reporting date about past events, current conditions and forecasts of future economic conditions. On an ongoing basis, we will contemplate forward-looking economic conditions in recording lifetime expected credit losses for our financial assets measured at cost, such as our trade receivables and certain other assets.

In January 2017, the FASB issued ASU 2017-04, which provides guidance to simplify how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. As a result, impairment charges are required for the amount by which a reporting unit’s carrying amount exceeds its fair value up to the amount of its allocated goodwill. We adopted the standard on January 1, 2020 and did not record any impairment charges.

In August 2018, the FASB issued ASU 2018-15 to help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement (hosting arrangement) by providing guidance for determining when the arrangement includes a software license. The amendments in this update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). Accordingly, the amendments require an entity (customer) in a hosting arrangement that is a service contract to follow the guidance in Subtopic 350-40 to determine which implementation costs to capitalize as an asset related to the service contract and which costs to expense. The amendments also require the entity (customer) to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement, which includes reasonably certain renewals. We adopted the standard on January 1, 2020 and no material impacts were noted.

In August 2018, the FASB issued ASU 2018-13, which amends disclosure requirements for fair value measurements. The new standard modifies disclosure requirements including removing requirements to disclose the valuation process for Level 3 measurements and adding requirements to disclose the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements and the range and weighted average of significant unobservable inputs used to develop Level 3 measurements. We adopted the standard on January 1, 2020 and no material impacts were noted.

Other accounting standards that have been issued by the FASB or other standards-setting bodies did not have a material impact on our Condensed Consolidated Financial Statements.

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net Income	$ 55,250	$ 62,999
Other Comprehensive Income (Loss):
Foreign currency translation adjustments	(42,229)	(9,611)
Gain (loss) on derivatives, net of tax	1,483	(393)
Defined benefit pension plan, net of tax
Amortization of prior service cost included in net income, net of tax	71	84
Amortization of net loss included in net income, net of tax	1,565	637
Total defined benefit pension plan, net of tax	1,636	721
Total other comprehensive income (loss)	(39,110)	(9,283)
Comprehensive Income	16,140	53,716
Comprehensive (Income) Loss Attributable to Noncontrolling Interests	3	(3)
Comprehensive Income Attributable to AptarGroup, Inc.	$ 16,143	$ 53,713

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Cash Flows from Operating Activities:
Net income	$ 55,250	$ 62,999
Adjustments to reconcile net income to net cash provided by operations:
Depreciation	42,792	41,487
Amortization	8,014	6,002
Stock based compensation	9,141	6,565
Provision for CECL	1,251	497
(Gain) loss on disposition of fixed assets	54	310
Deferred income taxes	6	671
Defined benefit plan expense	5,775	3,858
Equity in results of affiliates	799	95
Changes in balance sheet items, excluding effects from acquisitions and foreign currency adjustments:
Accounts and other receivables	(64,764)	(35,301)
Inventories	(8,615)	(13,097)
Prepaid and other current assets	(11,787)	(2,282)
Accounts payable, accrued and other liabilities	45,458	6,865
Income taxes payable	(5,278)	3,511
Retirement and deferred compensation plan liabilities	(1,312)	(5,940)
Other changes, net	8,249	1,396
Net Cash Provided by Operations	85,033	77,636
Cash Flows from Investing Activities:
Capital expenditures	(61,625)	(51,742)
Proceeds from sale of property, plant and equipment	166	178
Acquisition of business, release of escrow	(1,463)	(4,036)
Acquisition of intangible assets	(3,955)	(221)
Investment in equity securities	(20,423)
Proceeds from sale of investment in equity securities		16,487
Notes receivable, net	(785)	231
Net Cash Used by Investing Activities	(88,085)	(39,103)
Cash Flows from Financing Activities:
Proceeds from notes payable and overdrafts	8,148	16,783
Repayments of notes payable and overdrafts	(2,030)	(21,130)
Proceeds and repayments of short term credit facility, net	175,000	(78,222)
Proceeds from long-term obligations		10,446
Repayments of long-term obligations	(2,386)	(3,227)
Dividends paid	(23,031)	(21,377)
Proceeds from stock option exercises	18,602	20,939
Purchase of treasury stock		(15,000)
Net Cash Provided (Used) by Financing Activities	174,303	(90,788)
Effect of Exchange Rate Changes on Cash	(3,381)	2,809
Net Increase (Decrease) in Cash and Equivalents and Restricted Cash	167,870	(49,446)
Cash and Equivalents and Restricted Cash at Beginning of Period	246,973	266,823
Cash and Equivalents and Restricted Cash at End of Period	$ 414,843	$ 217,377

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EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Earning per share
Authorized common stock (in shares)	199,000		199,000
Common stock, par value (in dollars per share)	$ 0.01		$ 0.01
Income (Numerator)
Income available to common stockholders, basic (in dollars)	$ 55,253	$ 63,004
Income available to common stockholders, diluted (in dollars)	$ 55,253	$ 63,004
Shares (Denominator)
Basic (in shares)	64,009	62,964
Total average equivalent shares	66,111	65,349
Per Share Amount
Net income per share, basic (in dollars per share)	$ 0.86	$ 1.00
Net income per share, diluted (in dollars per share)	$ 0.84	$ 0.96
Stock options
Shares (Denominator)
Effect of dilutive stock based compensation (in shares)	1,810	2,222
Restricted stock units
Shares (Denominator)
Effect of dilutive stock based compensation (in shares)	292	163

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FAIR VALUE (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019	Oct. 31, 2019	May 31, 2019
Liabilities
Fair value of long-term obligations	$ 1,000,000	$ 1,100,000
Gateway Analytical
Liabilities
Fair value of contingent consideration arrangement	3,000	3,000		$ 3,000
Noble
Liabilities
Fair value of contingent consideration arrangement	2,900	2,900	$ 2,900
Assets and liabilities measured at fair value on recurring basis
Assets
Foreign exchange contracts, assets	2,061	206
Cross currency swap contract, asset	6,769	2,552
Total assets at fair value	8,830	2,758
Liabilities
Foreign exchange contracts, liabilities	505	401
Fair value of contingent consideration arrangement	5,930	5,930
Total liabilities at fair value	6,435	6,331
Assets and liabilities measured at fair value on recurring basis | Level 2
Assets
Foreign exchange contracts, assets	2,061	206
Cross currency swap contract, asset	6,769	2,552
Total assets at fair value	8,830	2,758
Liabilities
Foreign exchange contracts, liabilities	505	401
Total liabilities at fair value	505	401
Assets and liabilities measured at fair value on recurring basis | Level 3
Liabilities
Fair value of contingent consideration arrangement	5,930	5,930
Total liabilities at fair value	$ 5,930	$ 5,930

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INVENTORIES (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Inventories, by component
Raw materials	$ 106,787	$ 111,653
Work in process	120,151	123,750
Finished goods	144,921	140,392
Total	$ 371,859	$ 375,795

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EARNINGS PER SHARE (Tables)

3 Months Ended

Mar. 31, 2020

EARNINGS PER SHARE

Reconciliation of Basic and Diluted Earnings Per Share

	Three Months Ended
	March 31, 2020				March 31, 2019
	Diluted		Basic		Diluted		Basic
Consolidated operations
Income available to common stockholders	$	55,253	$	55,253	$	63,004	$	63,004
Average equivalent shares
Shares of common stock		64,009		64,009		62,964		62,964
Effect of dilutive stock-based compensation
Stock options		1,810		—		2,222		—
Restricted stock		292		—		163		—
Total average equivalent shares		66,111		64,009		65,349		62,964
Net income per share	$	0.84	$	0.86	$	0.96	$	1.00

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RESTRUCTURING INITIATIVES (Tables)

3 Months Ended

Mar. 31, 2020

RESTRUCTURING INITIATIVES.

Activity associated with the entity's restructuring initiatives

	Beginning		Net Charges for						Ending
	Reserve at		the Three Months				Interest and		Reserve at
	12/31/2019		Ended 3/31/2020		Cash Paid		FX Impact		3/31/2020
Employee severance	$	7,090	$	4,066	$	(503)	$	187	$	10,840
Professional fees and other costs		3,609		773		(3,069)		(9)		1,304
Totals	$	10,699	$	4,839	$	(3,572)	$	178	$	12,144

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RESTRUCTURING INITIATIVE (Details) - USD ($) $ in Thousands	3 Months Ended		27 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Mar. 31, 2020
Restructuring initiatives
Capital Expenditures	$ 61,625	$ 51,742
Restructuring reserve
Restructuring reserve, balance at the beginning of the period	10,699
Expense recognized related to the plan	4,839	9,530
Cash paid	(3,572)
Interest and FX impact	178
Restructuring reserve, balance at the end of the period	12,144		$ 12,144
Employee severance
Restructuring reserve
Restructuring reserve, balance at the beginning of the period	7,090
Expense recognized related to the plan	4,066
Cash paid	(503)
Interest and FX impact	187
Restructuring reserve, balance at the end of the period	10,840		10,840
Professional fees and other costs
Restructuring reserve
Restructuring reserve, balance at the beginning of the period	3,609
Expense recognized related to the plan	773
Cash paid	(3,069)
Interest and FX impact	(9)
Restructuring reserve, balance at the end of the period	1,304		1,304
Business Transformation
Restructuring initiatives
Expected implementation costs	110,000		110,000
Expected capital investments related to transformation plan	50,000		50,000
Cumulative expense incurred	91,300		91,300
Capital Expenditures			$ 40,000
Restructuring reserve
Expense recognized related to the plan	4,800	9,500
Beauty + Home
Restructuring reserve
Expense recognized related to the plan	4,907	8,269
Pharma
Restructuring reserve
Expense recognized related to the plan	(31)	326
Food + Beverage
Restructuring reserve
Expense recognized related to the plan	103	510
Corporate & Other
Restructuring reserve
Expense recognized related to the plan	$ (140)	$ 425

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LEASE COMMITMENTS - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$ 5,328	$ 6,469
Operating cash flows from finance leases	369	243
Financing cash flows from finance leases	1,657	1,140
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	5,233	4,515
Finance leases	$ 220	$ 10,697

XML

INCOME TAXES QTR (Details)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
INCOME TAXES
Effective income tax rate (as a percent)	29.20%	30.00%

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Cash Flow Hedge) (Details) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2017	Dec. 31, 2019
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Net after-tax loss included in accumulated other comprehensive earnings	$ (1,483)	$ 393
Derivatives in Cash Flow Hedging Relationships
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion)	5,026	$ 6,069
Cross Currency Swap Contract | Derivatives in Cash Flow Hedging Relationships
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount hedged			$ 280,000
Net after-tax loss included in accumulated other comprehensive earnings	200
Fair value of derivative asset	6,800
Cross Currency Swap Contract: Interest Component | Derivatives in Cash Flow Hedging Relationships
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount expected to be recognized in earnings in next twelve months related to cross currency swap contract	$ 2,200
Notes payable
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Proceeds from debt			$ 280,000
Interest rate on notes (as a percent)	1.36%		1.36%	1.36%

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FAIR VALUE (Tables)

3 Months Ended

Mar. 31, 2020

FAIR VALUE

Schedule of fair values of financial assets and liabilities

As of March 31, 2020, the fair values of our financial assets and liabilities were categorized as follows:

	Total		Level 1		Level 2		Level 3
Assets
Foreign exchange contracts (1)	$	2,061	$	—	$	2,061	$	—
Cross currency swap contract (1)		6,769		—		6,769		—
Total assets at fair value	$	8,830	$	—	$	8,830	$	—
Liabilities
Foreign exchange contracts (1)	$	505	$	—	$	505	$	—
Contingent consideration obligation		5,930		—		—		5,930
Total liabilities at fair value	$	6,435	$	—	$	505	$	5,930

As of December 31, 2019, the fair values of our financial assets and liabilities were categorized as follows:

	Total		Level 1		Level 2		Level 3
Assets
Foreign exchange contracts (1)	$	206	$	—	$	206	$	—
Cross currency swap contract (1)		2,552		—		2,552		—
Total assets at fair value	$	2,758	$	—	$	2,758	$	—
Liabilities
Foreign exchange contracts (1)	$	401	$	—	$	401	$	—
Contingent consideration obligation		5,930		—		—		5,930
Total liabilities at fair value	$	6,331	$	—	$	401	$	5,930

(1) Market approach valuation technique based on observable market transactions of spot and forward rates.

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REVENUE (Tables)

3 Months Ended

Mar. 31, 2020

REVENUE.

Schedule of revenue by segment by geographic area

	For the Three Months Ended March 31, 2020
					Latin
Segment	Europe		Domestic		America		Asia		Total
Beauty + Home	$	186,950	$	81,845	$	36,181	$	19,584	$	324,560
Pharma		190,130		90,965		6,579		9,522		297,196
Food + Beverage		28,769		57,590		8,034		5,404		99,797
Total	$	405,849	$	230,400	$	50,794	$	34,510	$	721,553

	For the Three Months Ended March 31, 2019
					Latin
Segment	Europe		Domestic		America		Asia		Total
Beauty + Home	$	216,233	$	86,979	$	42,642	$	21,805	$	367,659
Pharma		184,174		71,772		7,656		9,099		272,701
Food + Beverage		30,961		55,120		7,884		10,135		104,100
Total	$	431,368	$	213,871	$	58,182	$	41,039	$	744,460

Schedule of opening and closing balances of contract assets and contract liabilities

	Balance as of		Balance as of		Increase/
	December 31, 2019		March 31, 2020		(Decrease)
Contract asset (current)	$	16,245	$	13,457	$	(2,788)
Contract asset (long-term)	$	—	$	—	$	—
Contract liability (current)	$	79,305	$	78,974	$	(331)
Contract liability (long-term)	$	9,779	$	14,994	$	5,215

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LEASE COMMITMENTS (Tables)

3 Months Ended

Mar. 31, 2020

LEASE COMMITMENTS

Schedule of components of lease expense

Three Months Ended March 31,	2020		2019
Operating lease cost	$	5,254	$	6,004
Finance lease cost:
Amortization of right-of-use assets	$	1,199	$	872
Interest on lease liabilities		348		315
Total finance lease cost	$	1,547	$	1,187
Short-term lease and variable lease costs	$	2,448	$	1,942

Schedule of supplemental cash flow information related to leases

Three Months Ended March 31,	2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	5,328	$	6,469
Operating cash flows from finance leases		369		243
Financing cash flows from finance leases		1,657		1,140
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	5,233	$	4,515
Finance leases		220		10,697

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ACCUMULATED OTHER COMPREHENSIVE INCOME

3 Months Ended

Mar. 31, 2020

ACCUMULATED OTHER COMPREHENSIVE INCOME

ACCUMULATED OTHER COMPREHENSIVE INCOME

NOTE 9 – ACCUMULATED OTHER COMPREHENSIVE INCOME

Changes in Accumulated Other Comprehensive (Loss) Income by Component:

	Foreign		Defined Benefit
	Currency		Pension Plans		Derivatives		Total
Balance - December 31, 2018	$	(248,401)	$	(60,463)	$	(1,640)	$	(310,504)
Other comprehensive (loss) income before reclassifications		(9,619)		—		5,738		(3,881)
Amounts reclassified from accumulated other comprehensive income (loss)		—		721		(6,131)		(5,410)
Net current-period other comprehensive (loss) income		(9,619)		721		(393)		(9,291)
Balance - March 31, 2019	$	(258,020)	$	(59,742)	$	(2,033)	$	(319,795)
Balance - December 31, 2019	$	(257,124)	$	(83,147)	$	(1,677)	$	(341,948)
Other comprehensive (loss) income before reclassifications		(42,229)		—		5,026		(37,203)
Amounts reclassified from accumulated other comprehensive income (loss)		—		1,636		(3,543)		(1,907)
Net current-period other comprehensive (loss) income		(42,229)		1,636		1,483		(39,110)
Balance - March 31, 2020	$	(299,353)	$	(81,511)	$	(194)	$	(381,058)

Reclassifications Out of Accumulated Other Comprehensive (Loss) Income:

	Amount Reclassified from
Details about Accumulated Other	Accumulated Other				Affected Line in the Statement
Comprehensive Income Components	Comprehensive Income				Where Net Income is Presented
Three Months Ended March 31,	2020		2019
Defined Benefit Pension Plans
Amortization of net loss	$	2,062	$	852	(1)
Amortization of prior service cost		97		113	(1)
		2,159		965	Total before tax
		(523)		(244)	Tax benefit
	$	1,636	$	721	Net of tax
Derivatives
Changes in cross currency swap: interest component	$	(763)	$	(1,454)	Interest Expense
Changes in cross currency swap: foreign exchange component		(2,780)		(4,677)	Miscellaneous, net
	$	(3,543)	$	(6,131)	Net of tax
Total reclassifications for the period	$	(1,907)	$	(5,410)

(1) These accumulated other comprehensive income components are included in the computation of net periodic benefit costs, net of tax. See Note 8 – Retirement and Deferred Compensation Plans for additional details.

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INCOME TAXES

3 Months Ended

Mar. 31, 2020

INCOME TAXES

INCOME TAXES

NOTE 5 – INCOME TAXES

The tax provision for interim periods is determined using the estimated annual effective consolidated tax rate, based on the current estimate of full-year earnings and related estimated full year-taxes, adjusted for the impact of discrete quarterly items.

The effective tax rate for the three months ended March 31, 2020 and 2019, respectively, was 29.2% and 30.0%. The decrease in the effective tax rate for the three months ended March 31, 2020 was primarily due to a larger tax benefit from employee share-based compensation offset in part by a mix of other discrete items.

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RESTRUCTURING INITIATIVES

3 Months Ended

Mar. 31, 2020

RESTRUCTURING INITIATIVES.

RESTRUCTURING INITIATIVES

NOTE 19 – RESTRUCTURING INITIATIVES

In late 2017, we began a business transformation to drive profitable sales growth, increase operational excellence, enhance our approach to innovation and improve organizational effectiveness. The primary focus of the plan is the Beauty + Home segment; however, certain global general and administrative functions are also being addressed. For the three months ended March 31, 2020 and 2019, we recognized $4.8 million and $9.5 million of restructuring costs related to this plan, respectively. Using current exchange rates, we estimate total implementation costs of approximately $110 million for these initiatives, including costs that have been recognized to date. The cumulative expense incurred as of March 31, 2020 was $91.3 million. We also anticipate making capital investments related to the transformation plan of approximately $50 million, of which $40 million has been incurred to date.

As of March 31, 2020 we have recorded the following activity associated with the business transformation:

	Beginning		Net Charges for						Ending
	Reserve at		the Three Months				Interest and		Reserve at
	12/31/2019		Ended 3/31/2020		Cash Paid		FX Impact		3/31/2020
Employee severance	$	7,090	$	4,066	$	(503)	$	187	$	10,840
Professional fees and other costs		3,609		773		(3,069)		(9)		1,304
Totals	$	10,699	$	4,839	$	(3,572)	$	178	$	12,144

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EARNINGS PER SHARE

3 Months Ended

Mar. 31, 2020

EARNINGS PER SHARE

EARNINGS PER SHARE

NOTE 15 – EARNINGS PER SHARE

Basic net income per share is calculated by dividing net income attributable to Aptar by the weighted-average number of common shares outstanding during the period. Diluted net income per share is calculated by dividing the net income attributable to Aptar by the weighted-average number of common and common equivalent shares outstanding during the applicable period. The difference between basic and diluted earnings per share is attributable to stock-based compensation awards. Stock-based compensation awards for which total employee proceeds exceed the average market price over the applicable period would have an antidilutive effect on earnings per share, and accordingly, are excluded from the calculation of diluted earnings per share. The reconciliation of basic and diluted earnings per share for the three months ended March 31, 2020 and 2019 is as follows:

	Three Months Ended
	March 31, 2020				March 31, 2019
	Diluted		Basic		Diluted		Basic
Consolidated operations
Income available to common stockholders	$	55,253	$	55,253	$	63,004	$	63,004
Average equivalent shares
Shares of common stock		64,009		64,009		62,964		62,964
Effect of dilutive stock-based compensation
Stock options		1,810		—		2,222		—
Restricted stock		292		—		163		—
Total average equivalent shares		66,111		64,009		65,349		62,964
Net income per share	$	0.84	$	0.86	$	0.96	$	1.00

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Mar. 31, 2020

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION

The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of AptarGroup, Inc. and our subsidiaries. The terms “AptarGroup”, “Aptar”, “Company”, “we”, “us” or “our” as used herein refer to AptarGroup, Inc. and our subsidiaries. All significant intercompany accounts and transactions have been eliminated.

In the opinion of management, the unaudited Condensed Consolidated Financial Statements (the “Condensed Consolidated Financial Statements”) include all normal recurring adjustments necessary for a fair statement of consolidated financial position, results of operations, comprehensive income, changes in equity and cash flows for the interim periods presented. The accompanying Condensed Consolidated Financial Statements have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations, although we believe that the disclosures made are adequate to make the information presented not misleading. Also, certain financial position data included herein was derived from the audited Consolidated Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2019 but does not include all disclosures required by U.S. GAAP. Accordingly, these Condensed Consolidated Financial Statements and related notes should be read in conjunction with the audited Consolidated Financial Statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019. The results of operations of any interim period are not necessarily indicative of the results that may be expected for the year.

There are many uncertainties regarding the current COVID-19 pandemic, including the scope of scientific and health issues, the anticipated duration of the pandemic and the extent of local and worldwide social, political and economic disruption it may cause. The pandemic has impacted our business, operations and financial results during the quarter ended March 31, 2020 including an overall reduction to net sales. No impairments were recorded as of March 31, 2020. While the disruption is currently expected to be temporary, there is uncertainty around the duration. Due to significant uncertainty surrounding the situation, our judgment regarding future results could change and therefore our results could be materially impacted.

ADOPTION OF RECENT ACCOUNTING STANDARDS

Changes to U.S. GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of Accounting Standards Updates (“ASUs”) to the FASB’s Accounting Standards Codification.

Effective January 1, 2020, we adopted ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, issued by the FASB in June 2016, as well as the clarifying amendments subsequently issued. We applied the guidance using a modified retrospective approach and accordingly recognized an amount of $1.4 million as the cumulative adjustment to opening retained earnings in the first quarter of 2020. This is based on management's best estimates of specific losses on individual exposures particularly on current trade receivables, as well as the time value of money and reasonable and supportable information that is available at the reporting date about past events, current conditions and forecasts of future economic conditions. On an ongoing basis, we will contemplate forward-looking economic conditions in recording lifetime expected credit losses for our financial assets measured at cost, such as our trade receivables and certain other assets.

In January 2017, the FASB issued ASU 2017-04, which provides guidance to simplify how an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. As a result, impairment charges are required for the amount by which a reporting unit’s carrying amount exceeds its fair value up to the amount of its allocated goodwill. We adopted the standard on January 1, 2020 and did not record any impairment charges.

In August 2018, the FASB issued ASU 2018-15 to help entities evaluate the accounting for fees paid by a customer in a cloud computing arrangement (hosting arrangement) by providing guidance for determining when the arrangement includes a software license. The amendments in this update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). Accordingly, the amendments require an entity (customer) in a hosting arrangement that is a service contract to follow the guidance in Subtopic 350-40 to determine which implementation costs to capitalize as an asset related to the service contract and which costs to expense. The amendments also require the entity (customer) to expense the capitalized implementation costs of a hosting arrangement that is a service contract over the term of the hosting arrangement, which includes reasonably certain renewals. We adopted the standard on January 1, 2020 and no material impacts were noted.

In August 2018, the FASB issued ASU 2018-13, which amends disclosure requirements for fair value measurements. The new standard modifies disclosure requirements including removing requirements to disclose the valuation process for Level 3 measurements and adding requirements to disclose the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 fair value measurements and the range and weighted average of significant unobservable inputs used to develop Level 3 measurements. We adopted the standard on January 1, 2020 and no material impacts were noted.

Other accounting standards that have been issued by the FASB or other standards-setting bodies did not have a material impact on our Condensed Consolidated Financial Statements.

INCOME TAXES

We compute taxes on income in accordance with the tax rules and regulations of the many taxing authorities where the income is earned. The income tax rates imposed by these taxing authorities may vary substantially. Taxable income may differ from pre-tax income for financial accounting purposes. To the extent that these differences create timing differences between the tax basis of an asset or liability and our reported amount in the financial statements, an appropriate provision for deferred income taxes is made.

We maintain our assertion that the cash and distributable reserves at our non-U.S. affiliates are indefinitely reinvested.  Under current U.S. tax laws, all of our non-U.S. earnings are subject to U.S. taxation. We will provide for the necessary withholding and local income taxes when management decides that an affiliate should make a distribution. These decisions are made taking into consideration the financial requirements of the non-U.S. affiliates and the global cash management goals of the Company.

We provide a liability for the amount of unrecognized tax benefits from uncertain tax positions. This liability is provided whenever we determine that a tax benefit will not meet a more-likely-than-not threshold for recognition.

The Company is subject to taxation and files income tax returns in the U.S. federal jurisdiction and many state and foreign jurisdictions. The Company believes that an adequate provision has been made for any adjustments that may result from tax examinations. However, the outcome of tax audits cannot be predicted with certainty. If any issues addressed in the Company’s tax audits are resolved in a manner inconsistent with its expectations, the Company could be required to adjust its provision for income taxes in the period such resolution occurs. The resolution of each of these audits is not expected to be material to our Condensed Consolidated Financial Statements.

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2020	Apr. 24, 2020
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Mar. 31, 2020
Entity File Number	1-11846
Entity Registrant Name	APTARGROUP INC
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	36-3853103
Entity Address, Address Line One	265 EXCHANGE DRIVE
Entity Address, Address Line Two	SUITE 100
Entity Address, City or Town	CRYSTAL LAKE
Entity Address, State or Province	IL
Entity Address, Postal Zip Code	60014
City Area Code	815
Local Phone Number	477-0424
Title of 12(b) Security	Common Stock, $.01 par value
Trading Symbol	ATR
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		64,186,756
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Entity Central Index Key	0000896622
Amendment Flag	false

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands, shares in Millions	Mar. 31, 2020	Dec. 31, 2019
CONDENSED CONSOLIDATED BALANCE SHEETS
Accounts and notes receivable, allowance for doubtful accounts (in dollars)	$ 5,657	$ 3,626
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	199.0	199.0
Common stock, shares issued	68.9	68.6
Treasury stock, shares	4.7	4.8

XML

ACQUISITIONS (Tables)

3 Months Ended

Mar. 31, 2020

ACQUISITIONS

Summary of assets acquired and liabilities assumed at estimated fair value

	2019
Assets
Cash and equivalents	$	3,427
Accounts receivable		3,504
Prepaid and other		2,478
Property, plant and equipment		4,267
Goodwill		59,143
Intangible assets		52,980
Other miscellaneous assets		430
Liabilities
Accounts payable, accrued and other liabilities		5,388
Deferred income taxes		2,592
Deferred and other non-current liabilities		1,598
Net assets acquired	$	116,651

Summary of the fair value estimates of the acquired identifiable intangible assets and weighted-average useful lives as of the acquisition date

	2019
	Weighted-Average	Estimated
	Useful Life	Fair Value
	(in years)	of Asset
Acquired technology	8	$	9,160
Customer relationships	11		39,379
Trademarks and trade names	4		2,457
License agreements and other	1		1,984
Total		$	52,980

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REVENUE - Revenue by Geographic Segment (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
REVENUE
Net revenue	$ 721,553	$ 744,460
Beauty + Home
REVENUE
Net revenue	324,560	367,659
Pharma
REVENUE
Net revenue	297,196	272,701
Food + Beverage
REVENUE
Net revenue	99,797	104,100
Europe
REVENUE
Net revenue	405,849	431,368
Europe | Beauty + Home
REVENUE
Net revenue	186,950	216,233
Europe | Pharma
REVENUE
Net revenue	190,130	184,174
Europe | Food + Beverage
REVENUE
Net revenue	28,769	30,961
North America
REVENUE
Net revenue	230,400	213,871
North America | Beauty + Home
REVENUE
Net revenue	81,845	86,979
North America | Pharma
REVENUE
Net revenue	90,965	71,772
North America | Food + Beverage
REVENUE
Net revenue	57,590	55,120
Latin America
REVENUE
Net revenue	50,794	58,182
Latin America | Beauty + Home
REVENUE
Net revenue	36,181	42,642
Latin America | Pharma
REVENUE
Net revenue	6,579	7,656
Latin America | Food + Beverage
REVENUE
Net revenue	8,034	7,884
Asia
REVENUE
Net revenue	34,510	41,039
Asia | Beauty + Home
REVENUE
Net revenue	19,584	21,805
Asia | Pharma
REVENUE
Net revenue	9,522	9,099
Asia | Food + Beverage
REVENUE
Net revenue	$ 5,404	$ 10,135

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ACQUISITIONS (Details) - USD ($) $ in Thousands						3 Months Ended
	Apr. 01, 2020	Oct. 31, 2019	Aug. 02, 2019	Jun. 05, 2019	May 31, 2019	Mar. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Acquisitions
Acquisition related costs						$ (2,274)
Restricted cash included in prepaid and other						4,003
Assets
Goodwill						756,081	$ 763,461
Bapco
Acquisitions
Ownership interest previously held								20.00%
Fusion Packaging | Subsequent Events
Acquisitions
Percentage of interest acquired	100.00%
Cost of acquired entity	$ 165,000
Earn-out provision payment maximum under the purchase agreement	$ 33,900
Term of earn-out provision	3 years
2019 Acquisitions
Acquisitions
Goodwill expected to be tax deductible							29,600
Assets
Cash and equivalents							3,427
Accounts receivable							3,504
Prepaid and other							2,478
Property, plant and equipment							4,267
Goodwill							59,143
Intangible assets							52,980
Other miscellaneous assets							430
Liabilities
Accounts payable, accrued and other liabilities							5,388
Deferred income taxes							2,592
Deferred and other non-current liabilities							1,598
Net assets acquired							116,651
Noble
Acquisitions
Percentage of interest acquired		100.00%
Acquisition of business, net of cash received		$ 62,300				463
Fair value of contingent consideration arrangement		2,900				2,900	2,900
Restricted cash included in prepaid and other							5,000
Working capital escrow released						1,000
Assets
Cash and equivalents		$ 1,600
Gateway Analytical
Acquisitions
Acquisition of business, net of cash received					$ 7,000
Fair value of contingent consideration arrangement					$ 3,000	$ 3,000	$ 3,000
Nanopharm
Acquisitions
Acquisition of business, net of cash received				$ 38,100
Assets
Cash and equivalents				$ 1,800
Bapco
Acquisitions
Percentage of interest acquired			80.00%
Acquisition of business, net of cash received			$ 3,800
Assets
Cash and equivalents			$ 2,900

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STOCK REPURCHASE PROGRAM (Details) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2020	Apr. 18, 2019
Stock repurchase program
Aggregate amount of share repurchases (in dollars)	$ 15,000
Common stock repurchased (retired and held in treasury) (in shares)	159
Common stock repurchased (retired and held in treasury)	$ 15,000
Remaining authorized repurchase amount		$ 278,500
Stock Repurchase Program April 18, 2019
Stock repurchase program
Share repurchases authorized amount			$ 350,000

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Effect of Derivative Instruments on the Consolidated Statements of Income) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Derivative instruments, gain or (loss)
Foreign Exchange Contract, Amount of Gain (Loss) Recognized in Income on Derivative, not designated as hedging instruments	$ 1,747	$ (263)
Other Nonoperating Income (Expense)	(1,412)	466
Interest Expense.	8,388	9,214
Derivatives in Cash Flow Hedging Relationships
Derivative instruments, gain or (loss)
Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion)	5,026	6,069
Amount of Gain (Loss) Reclassified from AOCI on Derivative	3,543	6,131
Foreign Exchange Contracts
Derivative instruments, gain or (loss)
Foreign Exchange Contract, Amount of Gain (Loss) Recognized in Income on Derivative, not designated as hedging instruments	1,747	(263)
Cross Currency Swap Contract: Interest Component | Interest expense | Derivatives in Cash Flow Hedging Relationships
Derivative instruments, gain or (loss)
Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion)	2,246	1,392
Amount of Gain (Loss) Reclassified from AOCI on Derivative	763	1,454
Interest Expense.	8,388
Cross Currency Swap Contract: Foreign Exchange Component | Other Income (Expense): Miscellaneous, net | Derivatives in Cash Flow Hedging Relationships
Derivative instruments, gain or (loss)
Amount of Gain or (Loss) Recognized in OCI on Derivative (Effective Portion)	2,780	4,677
Amount of Gain (Loss) Reclassified from AOCI on Derivative	2,780	$ 4,677
Other Nonoperating Income (Expense)	$ (1,412)

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ACCUMULATED OTHER COMPREHENSIVE INCOME (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Accumulated other comprehensive income activity
Balance at the beginning of the period	$ 1,571,916
Balance at the end of the period	1,587,290
Foreign Currency
Accumulated other comprehensive income activity
Balance at the beginning of the period	(257,124)	$ (248,401)
Other comprehensive income (loss) before reclassifications	(42,229)	(9,619)
Net current-period other comprehensive income (loss)	(42,229)	(9,619)
Balance at the end of the period	(299,353)	(258,020)
Defined Benefit Pension Plans
Accumulated other comprehensive income activity
Balance at the beginning of the period	(83,147)	(60,463)
Amounts reclassified from accumulated other comprehensive income	1,636	721
Net current-period other comprehensive income (loss)	1,636	721
Balance at the end of the period	(81,511)	(59,742)
Derivatives
Accumulated other comprehensive income activity
Balance at the beginning of the period	(1,677)	(1,640)
Other comprehensive income (loss) before reclassifications	5,026	5,738
Amounts reclassified from accumulated other comprehensive income	(3,543)	(6,131)
Net current-period other comprehensive income (loss)	1,483	(393)
Balance at the end of the period	(194)	(2,033)
Accumulated Other Comprehensive Income/(Loss)
Accumulated other comprehensive income activity
Balance at the beginning of the period	(341,948)	(310,504)
Other comprehensive income (loss) before reclassifications	(37,203)	(3,881)
Amounts reclassified from accumulated other comprehensive income	(1,907)	(5,410)
Net current-period other comprehensive income (loss)	(39,110)	(9,291)
Balance at the end of the period	$ (381,058)	$ (319,795)

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DEBT (Details) $ in Thousands, € in Millions	12 Months Ended
	Dec. 31, 2017 USD ($)	Mar. 31, 2020 USD ($)	Mar. 31, 2020 EUR (€)	Dec. 31, 2019 USD ($)	Dec. 31, 2019 EUR (€)
Components of the company's debt obligations
Consolidated Leverage Ratio		1.73	1.73
Consolidated Interest Coverage Ratio		16.32	16.32
Long-term obligations gross including current maturities		$ 1,142,891		$ 1,153,682
Current maturities of long-term obligations		(65,049)		(65,988)
Total long-term obligations		1,077,842		1,087,694
Deferred Finance Costs, Net, Total		2,097		2,241
Deferred debt issuance costs noncurrent		2,097		2,241
Long-term obligations including current maturities		1,140,794		1,151,441
Current maturities of long-term obligations		(65,049)		(65,988)
Long-term obligations, net of unamortized debt issuance costs		1,075,745		1,085,453
Aggregate long-term maturities, excluding finance lease obligations
Year One		61,181
Year Two		60,285
Year Three		134,343
Year Four		337,444
Year Five		270,846
After Year Five		$ 250,397
Minimum
Components of the company's debt obligations
Consolidated Interest Coverage Ratio		3.00	3.00
Maximum
Components of the company's debt obligations
Consolidated Leverage Ratio		3.50	3.50
5-year revolving credit facility maturing in July 2022
Components of the company's debt obligations
Revolving credit facility maximum borrowing capacity		$ 300,000	€ 150.0
Compensating balance requirement		0
Amount outstanding under line of credit		200,000	€ 0.0	25,000	€ 0.0
Notes payable
Components of the company's debt obligations
Proceeds from debt	$ 280,000
Long-term obligations gross including current maturities		168,000		168,000
Deferred Finance Costs, Net, Total		352		390
Long-term obligations including current maturities		$ 167,648		$ 167,610
Interest rate on notes (as a percent)	1.36%	1.36%	1.36%	1.36%	1.36%
Floating interest rate prior to conversion to a fixed interest rate		3.10%	3.10%	3.20%	3.20%
Notes payable 0.00% - 10.90%, due in monthly and annual installments through 2028
Components of the company's debt obligations
Long-term obligations gross including current maturities		$ 15,551		$ 19,220
Long-term obligations including current maturities		$ 15,551		$ 19,220
Notes payable 0.00% - 10.90%, due in monthly and annual installments through 2028 | Minimum
Components of the company's debt obligations
Interest rate on notes (as a percent)		0.00%	0.00%	0.00%	0.00%
Notes payable 0.00% - 10.90%, due in monthly and annual installments through 2028 | Maximum
Components of the company's debt obligations
Interest rate on notes (as a percent)		10.90%	10.90%	10.90%	10.90%
Senior unsecured notes 3.2%, due in 2022
Components of the company's debt obligations
Long-term obligations gross including current maturities		$ 75,000		$ 75,000
Deferred Finance Costs, Net, Total		59		64
Long-term obligations including current maturities		$ 74,941		$ 74,936
Interest rate on notes (as a percent)		3.20%	3.20%	3.20%	3.20%
Senior unsecured notes 3.5%, due in 2023
Components of the company's debt obligations
Long-term obligations gross including current maturities		$ 125,000		$ 125,000
Deferred Finance Costs, Net, Total		135		144
Long-term obligations including current maturities		$ 124,865		$ 124,856
Interest rate on notes (as a percent)		3.50%	3.50%	3.50%	3.50%
Senior unsecured notes 0.98%, due in 2023
Components of the company's debt obligations
Long-term obligations gross including current maturities		$ 110,315		$ 112,170
Deferred Finance Costs, Net, Total		341		356
Long-term obligations including current maturities		$ 109,974		$ 111,814
Interest rate on notes (as a percent)		1.00%	1.00%	1.00%	1.00%
Senior unsecured notes 3.4%, due in 2024
Components of the company's debt obligations
Long-term obligations gross including current maturities		$ 50,000		$ 50,000
Deferred Finance Costs, Net, Total		60		63
Long-term obligations including current maturities		$ 49,940		$ 49,937
Interest rate on notes (as a percent)		3.40%	3.40%	3.40%	3.40%
Senior unsecured notes 3.5%, due in 2024
Components of the company's debt obligations
Long-term obligations gross including current maturities		$ 100,000		$ 100,000
Deferred Finance Costs, Net, Total		135		144
Long-term obligations including current maturities		$ 99,865		$ 99,856
Interest rate on notes (as a percent)		3.50%	3.50%	3.50%	3.50%
Senior unsecured notes 1.17%, due in 2024
Components of the company's debt obligations
Long-term obligations gross including current maturities		$ 220,630		$ 224,340
Deferred Finance Costs, Net, Total		701		742
Long-term obligations including current maturities		$ 219,929		$ 223,598
Interest rate on notes (as a percent)		1.20%	1.20%	1.20%	1.20%
Senior unsecured notes 3.6%, due in 2025
Components of the company's debt obligations
Long-term obligations gross including current maturities		$ 125,000		$ 125,000
Deferred Finance Costs, Net, Total		157		169
Long-term obligations including current maturities		$ 124,843		$ 124,831
Interest rate on notes (as a percent)		3.60%	3.60%	3.60%	3.60%
Senior unsecured notes 3.6%, due in 2026
Components of the company's debt obligations
Long-term obligations gross including current maturities		$ 125,000		$ 125,000
Deferred Finance Costs, Net, Total		157		169
Long-term obligations including current maturities		$ 124,843		$ 124,831
Interest rate on notes (as a percent)		3.60%	3.60%	3.60%	3.60%
Financial lease liabilities
Components of the company's debt obligations
Long-term obligations gross including current maturities		$ 28,395		$ 29,952
Long-term obligations including current maturities		$ 28,395		$ 29,952

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ACQUISITIONS (Acquired Intangibles) (Details) - 2019 Acquisitions $ in Thousands	12 Months Ended
	Dec. 31, 2019 USD ($)
Acquired finite-lived intangible assets
Estimated Fair Value of Asset	$ 52,980
Acquired technology
Acquired finite-lived intangible assets
Weighted average useful life	8 years
Estimated Fair Value of Asset	$ 9,160
Customer relationships
Acquired finite-lived intangible assets
Weighted average useful life	11 years
Estimated Fair Value of Asset	$ 39,379
Trademarks and trade names
Acquired finite-lived intangible assets
Weighted average useful life	4 years
Estimated Fair Value of Asset	$ 2,457
License agreements and other
Acquired finite-lived intangible assets
Weighted average useful life	1 year
Estimated Fair Value of Asset	$ 1,984

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FAIR VALUE

3 Months Ended

Mar. 31, 2020

FAIR VALUE

FAIR VALUE

NOTE 11 – FAIR VALUE

Authoritative guidelines require the categorization of assets and liabilities into three levels based upon the assumptions (inputs) used to price the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3 generally requires significant management judgment. The three levels are defined as follows:

● Level 1: Unadjusted quoted prices in active markets for identical assets and liabilities.

● Level 2: Observable inputs other than those included in Level 1. For example, quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets.

● Level 3: Unobservable inputs reflecting management’s own assumptions about the inputs used in pricing the asset or liability.

As of March 31, 2020, the fair values of our financial assets and liabilities were categorized as follows:

	Total		Level 1		Level 2		Level 3
Assets
Foreign exchange contracts (1)	$	2,061	$	—	$	2,061	$	—
Cross currency swap contract (1)		6,769		—		6,769		—
Total assets at fair value	$	8,830	$	—	$	8,830	$	—
Liabilities
Foreign exchange contracts (1)	$	505	$	—	$	505	$	—
Contingent consideration obligation		5,930		—		—		5,930
Total liabilities at fair value	$	6,435	$	—	$	505	$	5,930

As of December 31, 2019, the fair values of our financial assets and liabilities were categorized as follows:

	Total		Level 1		Level 2		Level 3
Assets
Foreign exchange contracts (1)	$	206	$	—	$	206	$	—
Cross currency swap contract (1)		2,552		—		2,552		—
Total assets at fair value	$	2,758	$	—	$	2,758	$	—
Liabilities
Foreign exchange contracts (1)	$	401	$	—	$	401	$	—
Contingent consideration obligation		5,930		—		—		5,930
Total liabilities at fair value	$	6,331	$	—	$	401	$	5,930

(1) Market approach valuation technique based on observable market transactions of spot and forward rates.

The carrying amounts of our other current financial instruments such as cash and equivalents, accounts and notes receivable, notes payable and current maturities of long-term obligations approximate fair value due to the short-term maturity of the instruments. We consider our long-term obligations a Level 2 liability and utilize the market approach valuation technique based on interest rates that are currently available to us for issuance of debt with similar terms and maturities. The estimated fair value of our long-term obligations was $1.0 billion as of March 31, 2020 and $1.1 billion as of December 31, 2019.

As discussed in Note 17 - Acquisitions, we have a contingent consideration obligation to the selling equity holders of Noble in connection with the Noble Acquisition (as defined herein) based on 2024 cumulative performance targets and a contingent consideration obligation to the selling equity holder of Gateway in connection with the Gateway Acquisition (as defined herein) based on 2020 and 2022 performance targets. We consider these obligations a Level 3 liability and have estimated the aggregate fair value for these contingent consideration arrangements to be $2.9 million and $3.0 million, respectively, as of March 31, 2020 and December 31, 2019.

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LEASE COMMITMENTS

3 Months Ended

Mar. 31, 2020

LEASE COMMITMENTS

LEASE COMMITMENTS

NOTE 7 – LEASES

We lease certain warehouse, plant and office facilities as well as certain equipment under noncancelable operating and finance leases expiring at various dates through the year 2032. Most of the operating leases contain renewal options and certain leases include options to purchase the related asset during or at the end of the lease term.

Amortization expense related to finance leases is included in depreciation expense while rent expense related to operating leases is included within cost of sales and selling research & development and administrative expenses (“SG&A”).

The components of lease expense for the three months ended March 31, 2020 and 2019 were as follows:

Three Months Ended March 31,	2020		2019
Operating lease cost	$	5,254	$	6,004
Finance lease cost:
Amortization of right-of-use assets	$	1,199	$	872
Interest on lease liabilities		348		315
Total finance lease cost	$	1,547	$	1,187
Short-term lease and variable lease costs	$	2,448	$	1,942

Supplemental cash flow information related to leases was as follows:

Three Months Ended March 31,	2020		2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	5,328	$	6,469
Operating cash flows from finance leases		369		243
Financing cash flows from finance leases		1,657		1,140
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	5,233	$	4,515
Finance leases		220		10,697

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INVENTORIES

3 Months Ended

Mar. 31, 2020

INVENTORIES

INVENTORIES

NOTE 3 - INVENTORIES

Inventories, by component, consisted of:

	March 31,		December 31,
	2020		2019
Raw materials	$	106,787	$	111,653
Work in process		120,151		123,750
Finished goods		144,921		140,392
Total	$	371,859	$	375,795

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GOODWILL AND OTHER INTANGIBLE ASSETS (Tables)

3 Months Ended

Mar. 31, 2020

GOODWILL AND OTHER INTANGIBLE ASSETS

Schedule of changes in the carrying amount of goodwill

	Beauty +				Food +		Corporate
	Home		Pharma		Beverage		& Other		Total
Goodwill	$	221,658	$	413,650	$	128,153	$	1,615	$	765,076
Accumulated impairment losses		—		—		—		(1,615)		(1,615)
Balance as of December 31, 2019	$	221,658	$	413,650	$	128,153	$	—	$	763,461
Acquisition		—		463		—		—		463
Foreign currency exchange effects		(2,201)		(5,543)		(99)		—		(7,843)
Goodwill	$	219,457	$	408,570	$	128,054	$	1,615	$	757,696
Accumulated impairment losses		—		—		—		(1,615)		(1,615)
Balance as of March 31, 2020	$	219,457	$	408,570	$	128,054	$	—	$	756,081

Summary of amortized intangible assets

		March 31, 2020							December 31, 2019
Weighted Average		Gross						Gross
Amortization Period		Carrying		Accumulated		Net		Carrying		Accumulated		Net
	(Years)	Amount		Amortization		Value		Amount		Amortization		Value
Amortized intangible assets:
Patents	7.9	$	3,001		(1,304)	$	1,697	$	2,804	$	(1,318)	$	1,486
Acquired technology	13.0		99,437		(27,143)		72,294		100,511		(25,430)		75,081
Customer relationships	13.7		216,198		(37,774)		178,424		217,934		(33,924)		184,010
Trademarks and trade names	6.9		34,131		(11,919)		22,212		35,015		(11,003)		24,012
License agreements and other	17.6		19,671		(10,177)		9,494		16,153		(9,658)		6,495
Total intangible assets	13.0	$	372,438	$	(88,317)	$	284,121	$	372,417	$	(81,333)	$	291,084

Schedule of future estimated amortization expense

Future estimated amortization expense for the years ending December 31 is as follows:

2020	$	20,725	(remaining estimated amortization for 2020)
2021		27,154
2022		26,915
2023		26,835
2024 and thereafter		182,492

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ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables)

3 Months Ended

Mar. 31, 2020

ACCUMULATED OTHER COMPREHENSIVE INCOME

Changes in Accumulated Other Comprehensive Income/(Loss) by Component

	Foreign		Defined Benefit
	Currency		Pension Plans		Derivatives		Total
Balance - December 31, 2018	$	(248,401)	$	(60,463)	$	(1,640)	$	(310,504)
Other comprehensive (loss) income before reclassifications		(9,619)		—		5,738		(3,881)
Amounts reclassified from accumulated other comprehensive income (loss)		—		721		(6,131)		(5,410)
Net current-period other comprehensive (loss) income		(9,619)		721		(393)		(9,291)
Balance - March 31, 2019	$	(258,020)	$	(59,742)	$	(2,033)	$	(319,795)
Balance - December 31, 2019	$	(257,124)	$	(83,147)	$	(1,677)	$	(341,948)
Other comprehensive (loss) income before reclassifications		(42,229)		—		5,026		(37,203)
Amounts reclassified from accumulated other comprehensive income (loss)		—		1,636		(3,543)		(1,907)
Net current-period other comprehensive (loss) income		(42,229)		1,636		1,483		(39,110)
Balance - March 31, 2020	$	(299,353)	$	(81,511)	$	(194)	$	(381,058)

Reclassifications Out of Accumulated Other Comprehensive (Loss) Income

Reclassifications Out of Accumulated Other Comprehensive (Loss) Income:

	Amount Reclassified from
Details about Accumulated Other	Accumulated Other				Affected Line in the Statement
Comprehensive Income Components	Comprehensive Income				Where Net Income is Presented
Three Months Ended March 31,	2020		2019
Defined Benefit Pension Plans
Amortization of net loss	$	2,062	$	852	(1)
Amortization of prior service cost		97		113	(1)
		2,159		965	Total before tax
		(523)		(244)	Tax benefit
	$	1,636	$	721	Net of tax
Derivatives
Changes in cross currency swap: interest component	$	(763)	$	(1,454)	Interest Expense
Changes in cross currency swap: foreign exchange component		(2,780)		(4,677)	Miscellaneous, net
	$	(3,543)	$	(6,131)	Net of tax
Total reclassifications for the period	$	(1,907)	$	(5,410)

(1) These accumulated other comprehensive income components are included in the computation of net periodic benefit costs, net of tax. See Note 8 – Retirement and Deferred Compensation Plans for additional details.

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RETIREMENT AND DEFERRED COMPENSATION PLANS (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
United States
Change in benefit obligation:
Service cost	$ 3,577	$ 2,773
Interest cost	1,987	1,845
Change in plan assets:
Employer contribution	204
Components of net periodic benefit cost:
Service cost	3,577	2,773
Interest cost	1,987	1,845
Expected return on plan assets	(3,422)	(3,094)
Amortization of net loss	1,548	489
Net periodic benefit cost	3,690	2,013
Minimum funding requirements	0
Expected contribution in current fiscal year	200
Foreign Plans
Change in benefit obligation:
Service cost	1,768	1,460
Interest cost	340	501
Change in plan assets:
Employer contribution	711
Components of net periodic benefit cost:
Service cost	1,768	1,460
Interest cost	340	501
Expected return on plan assets	(634)	(592)
Amortization of net loss	514	363
Amortization of prior service cost	97	113
Net periodic benefit cost	$ 2,085	$ 1,845

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DEBT - Short-term Debt Obligations (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Dec. 31, 2019
Short-term Debt [Line Items]
Notes payable, revolving credit facility and overdrafts	$ 220,511	$ 44,259
Notes payable
Short-term Debt [Line Items]
Interest rate (as a percent)	8.10%
Notes payable, revolving credit facility and overdrafts	$ 2,664	1,436
Revolving credit facility
Short-term Debt [Line Items]
Interest rate (as a percent)	1.88%
Notes payable, revolving credit facility and overdrafts	$ 200,000	25,000
Overdrafts
Short-term Debt [Line Items]
Notes payable, revolving credit facility and overdrafts	$ 17,847	$ 17,823
Overdrafts | Minimum
Short-term Debt [Line Items]
Interest rate (as a percent)	5.68%
Overdrafts | Maximum
Short-term Debt [Line Items]
Interest rate (as a percent)	7.82%

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INVESTMENT IN EQUITY SECURITIES (Details) € in Thousands, $ in Thousands			3 Months Ended		12 Months Ended
	Apr. 01, 2020 USD ($)	Oct. 01, 2019	Mar. 31, 2020 USD ($)	Mar. 31, 2019 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2009 EUR (€)	Jan. 01, 2020 USD ($)	Dec. 31, 2019 USD ($)	Aug. 31, 2019 USD ($)
Other Investments			$ 3,541					$ 3,538
Total equity method and other investments			39,167					8,396
Investment in unconsolidated affiliate			20,423
Proceeds from sale of investment in equity securities				$ 16,487
Preferred equity stocks
Other Investments									$ 3,500
Number of preferred equity investments									2
Investment impairment			0
BTY
Equity method investments			31,043				$ 31,000	119
Ownership percentage of equity method investment							49.00%
Payment for equity method investment			20,000
Obligation associated with an agreement to acquire equity method investement			11,000
BTY | Strategic Definitive Agreement
Ownership percentage of equity method investment		49.00%
Initial lock-up period		5 years
Second lock-up period		3 years
BTY | Strategic Definitive Agreement | Call Option | Minimum
Ownership percentage of equity method investment		26.00%
BTY | Strategic Definitive Agreement | Call Option | Maximum
Ownership percentage of equity method investment		31.00%
Kali Care
Equity method investments			3,772					3,881
Investment in unconsolidated affiliate					$ 5,000
Ownership percentage of equity method investment					20.00%
Desotec GmbH
Equity method investments			$ 811					$ 858
Investment in unconsolidated affiliate | €						€ 574
Ownership percentage of equity method investment						23.00%
Healthcare, Inc. | Subsequent Events
Investment in unconsolidated affiliate	$ 5,000
Ownership percentage of equity method investment	30.00%

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DEBT

3 Months Ended

Mar. 31, 2020

DEBT

DEBT

NOTE 6 – DEBT

Notes Payable, Revolving Credit Facility and Overdrafts

At March 31, 2020 and December 31, 2019, our notes payable, revolving credit facility and overdrafts, consisted of the following:

	March 31,		December 31,
	2020		2019
Notes payable 8.10% due in 2020	$	2,664	$	1,436
Revolving credit facility 1.88% due in 2020		200,000		25,000
Overdrafts 5.68% - 7.82% due in 2020		17,847		17,823
	$	220,511	$	44,259

We maintain a multi-currency revolving credit facility with two tranches that matures in July 2022 which provides for unsecured financing of up to $300 million that is available in the U.S. and up to €150 million that is available to our wholly-owned UK subsidiary. $200.0 million was utilized under our U.S. facility and no balance was utilized under our euro-based revolving credit facility as of March 31, 2020. $25.0 million was utilized under our U.S. facility and no balance was utilized on our euro-based revolving credit facility as of December 31, 2019.

There are no compensating balance requirements associated with our revolving credit facility. Each borrowing under the credit facility will bear interest at rates based on LIBOR, prime rates or other similar rates, in each case plus an applicable margin. A facility fee on the total amount of the facility is also payable quarterly, regardless of usage. The applicable margins for borrowings under the credit facility and the facility fee percentage may change from time to time depending on changes in our consolidated leverage ratio.

Long-Term Obligations

At March 31, 2020, our long-term obligations consisted of the following:

			Unamortized
			Debt Issuance
	Principal		Costs		Net
Notes payable 0.00% – 10.90%, due in monthly and annual installments through 2028	$	15,551	$	—	$	15,551
Senior unsecured notes 3.2%, due in 2022		75,000		59		74,941
Senior unsecured debts 3.1% USD floating swapped to 1.36% EUR fixed, equal annual installments through 2022		168,000		352		167,648
Senior unsecured notes 3.5%, due in 2023		125,000		135		124,865
Senior unsecured notes 1.0%, due in 2023		110,315		341		109,974
Senior unsecured notes 3.4%, due in 2024		50,000		60		49,940
Senior unsecured notes 3.5%, due in 2024		100,000		135		99,865
Senior unsecured notes 1.2%, due in 2024		220,630		701		219,929
Senior unsecured notes 3.6%, due in 2025		125,000		157		124,843
Senior unsecured notes 3.6%, due in 2026		125,000		157		124,843
Finance Lease Liabilities		28,395		—		28,395
	$	1,142,891	$	2,097	$	1,140,794
Current maturities of long-term obligations		(65,049)		—		(65,049)
Total long-term obligations	$	1,077,842	$	2,097	$	1,075,745

At December 31, 2019, our long-term obligations consisted of the following:

			Unamortized
			Debt Issuance
	Principal		Costs		Net
Notes payable 0.00% – 10.90%, due in monthly and annual installments through 2028	$	19,220	$	—	$	19,220
Senior unsecured notes 3.2%, due in 2022		75,000		64		74,936
Senior unsecured debts 3.2% USD floating swapped to 1.36% EUR fixed, equal annual installments through 2022		168,000		390		167,610
Senior unsecured notes 3.5%, due in 2023		125,000		144		124,856
Senior unsecured notes 1.0%, due in 2023		112,170		356		111,814
Senior unsecured notes 3.4%, due in 2024		50,000		63		49,937
Senior unsecured notes 3.5%, due in 2024		100,000		144		99,856
Senior unsecured notes 1.2%, due in 2024		224,340		742		223,598
Senior unsecured notes 3.6%, due in 2025		125,000		169		124,831
Senior unsecured notes 3.6%, due in 2026		125,000		169		124,831
Finance Lease Liabilities		29,952		—		29,952
	$	1,153,682	$	2,241	$	1,151,441
Current maturities of long-term obligations		(65,988)		—		(65,988)
Total long-term obligations	$	1,087,694	$	2,241	$	1,085,453

The aggregate long-term maturities, excluding finance lease liabilities, which are disclosed in Note 7, due annually from the current balance sheet date for the next five years are $61,181, $60,285, $134,343, $337,444, $270,846 and $250,397 thereafter.

Covenants

Our revolving credit facility and corporate long-term obligations require us to satisfy certain financial and other covenants including:

	Requirement	Level at March 31, 2020
Consolidated Leverage Ratio (1)	Maximum of 3.50 to 1.00	1.73 to 1.00
Consolidated Interest Coverage Ratio (1)	Minimum of 3.00 to 1.00	16.32 to 1.00

(1) Definitions of ratios are included as part of the revolving credit facility agreement and the note purchase agreements.  

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REVENUE

3 Months Ended

Mar. 31, 2020

REVENUE.

REVENUE

NOTE 2 – REVENUE

At contract inception, we assess the goods and services promised in our contracts with customers and identify a performance obligation for each promise to transfer a good or service (or bundle of goods or services) that is distinct. To identify the performance obligations, we consider all the goods or services promised in the contract, whether explicitly stated or implied based on customary business practices. For a contract that has more than one performance obligation, we allocate the total contract consideration to each distinct performance obligation on a relative standalone selling price basis. Revenue is recognized when (or as) the performance obligations are satisfied (i.e., when the customer obtains control of the good or service). The majority of our revenues are derived from product and tooling sales; however, we also receive revenues from service, license, exclusivity and royalty arrangements, which collectively are not material to the year-to-date results. Revenue by segment and geography for the three months ended March 31, 2020 and 2019 is as follows:

	For the Three Months Ended March 31, 2020
					Latin
Segment	Europe		Domestic		America		Asia		Total
Beauty + Home	$	186,950	$	81,845	$	36,181	$	19,584	$	324,560
Pharma		190,130		90,965		6,579		9,522		297,196
Food + Beverage		28,769		57,590		8,034		5,404		99,797
Total	$	405,849	$	230,400	$	50,794	$	34,510	$	721,553

	For the Three Months Ended March 31, 2019
					Latin
Segment	Europe		Domestic		America		Asia		Total
Beauty + Home	$	216,233	$	86,979	$	42,642	$	21,805	$	367,659
Pharma		184,174		71,772		7,656		9,099		272,701
Food + Beverage		30,961		55,120		7,884		10,135		104,100
Total	$	431,368	$	213,871	$	58,182	$	41,039	$	744,460

We perform our obligations under a contract with a customer by transferring goods and/or services in exchange for consideration from the customer. The timing of performance will sometimes differ from the timing of the receipt of the associated consideration from the customer, thus resulting in the recognition of a contract asset or a contract liability. We recognize a contract asset when we transfer control of goods or services to a customer prior to invoicing for the related performance obligation. The contract asset is transferred to accounts receivable when the product is shipped and invoiced to the customer. We recognize a contract liability if the customer's payment of consideration precedes the entity's performance.

The opening and closing balances of our contract asset and contract liabilities are as follows:

	Balance as of		Balance as of		Increase/
	December 31, 2019		March 31, 2020		(Decrease)
Contract asset (current)	$	16,245	$	13,457	$	(2,788)
Contract asset (long-term)	$	—	$	—	$	—
Contract liability (current)	$	79,305	$	78,974	$	(331)
Contract liability (long-term)	$	9,779	$	14,994	$	5,215

The differences in the opening and closing balances of our contract asset and contract liabilities are primarily the result of timing differences between our performance and the customer’s payment. The total amount of revenue recognized during the current year against contract liabilities is $12.5 million, including $10.6 million relating to contract liabilities at the beginning of the year.

Determining the Transaction Price

In most cases, the transaction price for each performance obligation is stated in the contract. In determining the variable amounts of consideration within the transaction price (such as volume-based customer rebates), we include an estimate of the expected amount of consideration as revenue. We apply the expected value method based on all of the information (historical, current, and forecast) that is reasonably available and identify reasonable estimates based on this information. We apply the method consistently throughout the contract when estimating the effect of an uncertainty on the amount of variable consideration to which we will be entitled.

Product Sales

We primarily manufacture and sell dispensing, sealing and active packaging solutions. The amount of consideration is typically fixed for such customers. At the time of delivery, the customer is invoiced the agreed-upon price. Revenue from product sales is typically recognized upon manufacture or shipment, when control of the goods transfers to the customer.

To determine when the control transfers, we typically assess, among other things, the shipping terms of the contract, shipping being one of the indicators of transfer of control. A majority of product sales are sold free on board (“FOB”) shipping point. For FOB shipping point shipments, control of the goods transfers to the customer at the time of shipment of the goods. Therefore, our performance obligation is satisfied at the time of shipment. We have elected to account for shipping and handling costs that occur after the customer has obtained control of a good as fulfillment costs rather than as a promised service. We do not have any material significant payment terms as payment is typically received shortly after the point of sale.

There also exist instances where we manufacture highly customized products that have no alternative use to us and for which we have an enforceable right to payment for performance completed to date. For these products, we transfer control and recognize revenue over time by measuring progress towards completion using the Output Method based on the number of products produced. As we normally make our products to a customer’s order, the time between production and shipment of our products is typically within a few weeks.

As a part of our customary business practice, we offer a standard warranty that the products will materially comply with the technical specifications and will be free from material defects. Because such warranties are not sold separately, do not provide for any service beyond a guarantee of a product’s initial specifications, and are not required by law, there is no revenue deferral for these types of warranties.

Tooling Sales

We also build, or contract to build molds and other tools (collectively defined as “tooling”) necessary to produce our products. As with product sales, we recognize revenue when control of the tool transfers to the customer. If the tooling is highly customized with no alternative use to us and we have an enforceable right to payment for performance completed to date, we transfer control and recognize revenue over time by measuring progress towards completion using the Input Method based on costs incurred relative to total estimated costs to completion. Otherwise, revenue for the tooling is recognized at the point in time when the customer approves the tool. We do not have any material significant payment terms as payment is typically either received during the mold-build process or shortly after completion.

In certain instances, we offer extended warranties on tools sold to our customers above and beyond the normal standard warranties. We normally receive payment at the inception of the contract and recognize revenue over the term of the contract. At December 31, 2019, $515 thousand of unearned revenue associated with outstanding contracts was reported in Accounts Payable, Accrued and Other Liabilities. At March 31, 2020, the unearned amount was $432 thousand. We expect to recognize approximately $172 thousand of the unearned amount during the remainder of 2020, $123 thousand in 2021, and $137 thousand thereafter.

Credit Risk

We are exposed to credit losses primarily through our product sales, tooling sales and services to our customers. We assess each customer’s ability to pay for the products we sell by conducting a credit review. The credit review considers our expected billing exposure and timing for payment and the customer’s established credit rating or our assessment of the customer’s creditworthiness based on our analysis of their financial statements when a credit rating is not available. We also consider contract terms and conditions, country and political risks, and business strategy in our evaluation. A credit limit is established for each customer based on the outcome of this review.

We monitor our ongoing credit exposure through active review of customer balances against contract terms and due dates. Our activities include timely account reconciliation, dispute resolution and payment confirmation. We may employ collection agencies and legal counsel to pursue recovery of defaulted receivables.

At March 31, 2020, we reported $602 million of accounts receivable, net of CECL of $5.7 million. Changes in the allowance were not material for the three months ended March 31, 2020. Current uncertainty in credit and market conditions due to the COVID-19 pandemic may slow our collection efforts if customers experience significant difficulty accessing credit and paying their obligations, which may lead to higher than normal accounts receivable and increased CECL charges.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

3 Months Ended

Mar. 31, 2020

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

NOTE 10 – DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

We maintain a foreign exchange risk management policy designed to establish a framework to protect the value of our non-functional denominated transactions from adverse changes in exchange rates. Sales of our products can be denominated in a currency different from the currency in which the related costs to produce the product are denominated. Changes in exchange rates on such inter-country sales or intercompany loans can impact our results of operations. Our policy is not to engage in speculative foreign currency hedging activities, but to minimize our net foreign currency transaction exposure, defined as firm commitments and transactions recorded and denominated in currencies other than the functional currency. We may use foreign currency forward exchange contracts, options and cross currency swaps to economically hedge these risks.

For derivative instruments designated as hedges, we formally document the nature and relationships between the hedging instruments and the hedged items, as well as the risk management objectives, strategies for undertaking the various hedge transactions, and the method of assessing hedge effectiveness at inception. Quarterly thereafter, we formally assess whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in the fair value or cash flows of the hedged item. Additionally, in order to designate any derivative instrument as a hedge of an anticipated transaction, the significant characteristics and expected terms of any anticipated transaction must be specifically identified, and it must be probable that the anticipated transaction will occur. All derivative financial instruments used as hedges are recorded at fair value in the Condensed Consolidated Balance Sheets. See Note 11 - Fair Value for additional details.

Cash Flow Hedge

For derivative instruments that are designated and qualify as cash flow hedges, the changes in fair values are recorded in accumulated other comprehensive loss and included in changes in derivative gain/loss. The changes in the fair values of derivatives designated as cash flow hedges are reclassified from accumulated other comprehensive loss to net income when the underlying hedged item is recognized in earnings. Cash flows from the settlement of derivative contracts designated as cash flow hedges offset cash flows from the underlying hedged items and are included in operating activities in the Condensed Consolidated Statements of Cash Flows.

During 2017, our wholly-owned UK subsidiary borrowed $280 million in term loan borrowings under a new credit facility. In order to mitigate the currency risk of U.S. dollar debt on a euro functional currency entity and to mitigate the risk of variability in interest rates, we entered into a cross currency swap in the notional amount of $280 million to effectively hedge the foreign exchange and interest rate exposure on the $280 million term loan. This EUR/USD swap agreement fixed our U.S. dollar floating-rate debt to 1.36% euro fixed-rate debt. Related to this hedge, approximately $0.2 million of loss is included in accumulated other comprehensive loss at March 31, 2020. The amount expected to be recognized into earnings during the next 12 months related to the interest component of our cross currency swap based on prevailing foreign exchange and interest rates at March 31, 2020 is $2.2 million. The amount expected to be recognized into earnings during the next 12 months related to the foreign exchange component of our cross currency swap is dependent on fluctuations in currency exchange rates. As of March 31, 2020, the fair values of the cross currency swap were a $6.8 million asset. The swap contract expires on July 20, 2022.

Hedge of Net Investments in Foreign Operations

A significant number of our operations are located outside of the United States. Because of this, movements in exchange rates may have a significant impact on the translation of the financial condition and results of operations of our foreign subsidiaries. A strengthening U.S. dollar relative to foreign currencies has a dilutive translation effect on our financial condition and results of operations. Conversely, a weakening U.S. dollar has an additive effect. In some cases, we maintain debt in these subsidiaries to offset the net asset exposure. We do not otherwise actively manage this risk using derivative financial instruments. In the event we plan on a full or partial liquidation of any of our foreign subsidiaries where our net investment is likely to be monetized, we will consider hedging the currency exposure associated with such a transaction.

Other

As of March 31, 2020, we have recorded the fair value of foreign currency forward exchange contracts of $2.1 million in prepaid and other and $0.5 million in accounts payable and accrued liabilities on the balance sheet. All forward exchange contracts outstanding as of March 31, 2020 had an aggregate notional contract amount of $56.1 million.

Fair Value of Derivative Instruments in the Condensed Consolidated Balance Sheets as of March 31, 2020 and December 31, 2019

		March 31, 2020				December 31, 2019
				Derivatives				Derivatives
		Derivatives		not		Derivatives		not
		Designated		Designated		Designated		Designated
	Balance Sheet	as Hedging		as Hedging		as Hedging		as Hedging
	Location	Instruments		Instruments		Instruments		Instruments
Derivative Assets
Foreign Exchange Contracts	Prepaid and other	$	—	$	2,061	$	—	$	206
Cross Currency Swap Contract (1)	Prepaid and other		6,769		—		2,552		—
		$	6,769	$	2,061	$	2,552	$	206
Derivative Liabilities
Foreign Exchange Contracts	Accounts payable, accrued and other liabilities	$	—	$	505	$	—	$	401
		$	—	$	505	$	—	$	401

(1) This cross currency swap contract is composed of both an interest component and a foreign exchange component.

The Effect of Cash Flow Hedge Accounting on Accumulated Other Comprehensive Income (Loss) for the Three Months Ended March 31, 2020 and 2019

						Amount of Gain (Loss)				Total Amount
	Amount of Gain (Loss)				Location of (Loss)	Reclassified from				of Affected
Derivatives in Cash	Recognized in				Gain Recognized	Accumulated				Income
Flow Hedging	Other Comprehensive				in Income on	Other Comprehensive				Statement
Relationships	Income on Derivative				Derivatives	Income on Derivative				Line Item
	2020		2019			2020		2019
Cross currency swap contract:
Interest component	$	2,246	$	1,392	Interest expense	$	763	$	1,454	$	(8,388)
Foreign exchange component		2,780		4,677	Miscellaneous, net		2,780		4,677		(1,412)
	$	5,026	$	6,069		$	3,543	$	6,131

The Effect of Derivatives Not Designated as Hedging Instruments on the Condensed Consolidated Statements of Income for the Three Months Ended March 31, 2020 and 2019

		Amount of (Loss) Gain
Derivatives Not Designated	Location of (Loss) Gain Recognized	Recognized in Income
as Hedging Instruments	in Income on Derivatives	on Derivatives
		2020		2019
Foreign Exchange Contracts	Other (Expense) Income: Miscellaneous, net	$	1,747	$	(263)
		$	1,747	$	(263)

						Gross Amounts not Offset
			Gross Amounts	Net Amounts		in the Statement of
			Offset in the	Presented in		Financial Position
	Gross		Statement of	the Statement of		Financial	Cash Collateral	Net
	Amount		Financial Position	Financial Position		Instruments	Received	Amount
Description
March 31, 2020
Derivative Assets	$	8,830	—	$	8,830	—	—	$	8,830
Total Assets	$	8,830	—	$	8,830	—	—	$	8,830
Derivative Liabilities	$	505	—	$	505	—	—	$	505
Total Liabilities	$	505	—	$	505	—	—	$	505
December 31, 2019
Derivative Assets	$	2,758	—	$	2,758	—	—	$	2,758
Total Assets	$	2,758	—	$	2,758	—	—	$	2,758
Derivative Liabilities	$	401	—	$	401	—	—	$	401
Total Liabilities	$	401	—	$	401	—	—	$	401

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DEBT (Tables)

3 Months Ended

Mar. 31, 2020

DEBT

Schedule of short-term debt

	March 31,		December 31,
	2020		2019
Notes payable 8.10% due in 2020	$	2,664	$	1,436
Revolving credit facility 1.88% due in 2020		200,000		25,000
Overdrafts 5.68% - 7.82% due in 2020		17,847		17,823
	$	220,511	$	44,259

Schedule of long-term obligations

At March 31, 2020, our long-term obligations consisted of the following:

			Unamortized
			Debt Issuance
	Principal		Costs		Net
Notes payable 0.00% – 10.90%, due in monthly and annual installments through 2028	$	15,551	$	—	$	15,551
Senior unsecured notes 3.2%, due in 2022		75,000		59		74,941
Senior unsecured debts 3.1% USD floating swapped to 1.36% EUR fixed, equal annual installments through 2022		168,000		352		167,648
Senior unsecured notes 3.5%, due in 2023		125,000		135		124,865
Senior unsecured notes 1.0%, due in 2023		110,315		341		109,974
Senior unsecured notes 3.4%, due in 2024		50,000		60		49,940
Senior unsecured notes 3.5%, due in 2024		100,000		135		99,865
Senior unsecured notes 1.2%, due in 2024		220,630		701		219,929
Senior unsecured notes 3.6%, due in 2025		125,000		157		124,843
Senior unsecured notes 3.6%, due in 2026		125,000		157		124,843
Finance Lease Liabilities		28,395		—		28,395
	$	1,142,891	$	2,097	$	1,140,794
Current maturities of long-term obligations		(65,049)		—		(65,049)
Total long-term obligations	$	1,077,842	$	2,097	$	1,075,745

At December 31, 2019, our long-term obligations consisted of the following:

			Unamortized
			Debt Issuance
	Principal		Costs		Net
Notes payable 0.00% – 10.90%, due in monthly and annual installments through 2028	$	19,220	$	—	$	19,220
Senior unsecured notes 3.2%, due in 2022		75,000		64		74,936
Senior unsecured debts 3.2% USD floating swapped to 1.36% EUR fixed, equal annual installments through 2022		168,000		390		167,610
Senior unsecured notes 3.5%, due in 2023		125,000		144		124,856
Senior unsecured notes 1.0%, due in 2023		112,170		356		111,814
Senior unsecured notes 3.4%, due in 2024		50,000		63		49,937
Senior unsecured notes 3.5%, due in 2024		100,000		144		99,856
Senior unsecured notes 1.2%, due in 2024		224,340		742		223,598
Senior unsecured notes 3.6%, due in 2025		125,000		169		124,831
Senior unsecured notes 3.6%, due in 2026		125,000		169		124,831
Finance Lease Liabilities		29,952		—		29,952
	$	1,153,682	$	2,241	$	1,151,441
Current maturities of long-term obligations		(65,988)		—		(65,988)
Total long-term obligations	$	1,087,694	$	2,241	$	1,085,453

Schedule of covenants on revolving credit facility and corporate long-term obligations

	Requirement	Level at March 31, 2020
Consolidated Leverage Ratio (1)	Maximum of 3.50 to 1.00	1.73 to 1.00
Consolidated Interest Coverage Ratio (1)	Minimum of 3.00 to 1.00	16.32 to 1.00

(1) Definitions of ratios are included as part of the revolving credit facility agreement and the note purchase agreements.  

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

3 Months Ended

Mar. 31, 2020

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

Schedule of Fair Value of Derivative Instruments in the Consolidated Balance Sheets

Fair Value of Derivative Instruments in the Condensed Consolidated Balance Sheets as of March 31, 2020 and December 31, 2019

		March 31, 2020				December 31, 2019
				Derivatives				Derivatives
		Derivatives		not		Derivatives		not
		Designated		Designated		Designated		Designated
	Balance Sheet	as Hedging		as Hedging		as Hedging		as Hedging
	Location	Instruments		Instruments		Instruments		Instruments
Derivative Assets
Foreign Exchange Contracts	Prepaid and other	$	—	$	2,061	$	—	$	206
Cross Currency Swap Contract (1)	Prepaid and other		6,769		—		2,552		—
		$	6,769	$	2,061	$	2,552	$	206
Derivative Liabilities
Foreign Exchange Contracts	Accounts payable, accrued and other liabilities	$	—	$	505	$	—	$	401
		$	—	$	505	$	—	$	401

(1) This cross currency swap contract is composed of both an interest component and a foreign exchange component.

Schedule of Effect of Cash Flow Hedge Accounting on Accumulated Other Comprehensive Income (Loss)

The Effect of Cash Flow Hedge Accounting on Accumulated Other Comprehensive Income (Loss) for the Three Months Ended March 31, 2020 and 2019

						Amount of Gain (Loss)				Total Amount
	Amount of Gain (Loss)				Location of (Loss)	Reclassified from				of Affected
Derivatives in Cash	Recognized in				Gain Recognized	Accumulated				Income
Flow Hedging	Other Comprehensive				in Income on	Other Comprehensive				Statement
Relationships	Income on Derivative				Derivatives	Income on Derivative				Line Item
	2020		2019			2020		2019
Cross currency swap contract:
Interest component	$	2,246	$	1,392	Interest expense	$	763	$	1,454	$	(8,388)
Foreign exchange component		2,780		4,677	Miscellaneous, net		2,780		4,677		(1,412)
	$	5,026	$	6,069		$	3,543	$	6,131

Schedule of Effect of Derivatives Not Designated as Hedging Instruments on the Consolidated Statements of Income

The Effect of Derivatives Not Designated as Hedging Instruments on the Condensed Consolidated Statements of Income for the Three Months Ended March 31, 2020 and 2019

		Amount of (Loss) Gain
Derivatives Not Designated	Location of (Loss) Gain Recognized	Recognized in Income
as Hedging Instruments	in Income on Derivatives	on Derivatives
		2020		2019
Foreign Exchange Contracts	Other (Expense) Income: Miscellaneous, net	$	1,747	$	(263)
		$	1,747	$	(263)

Schedule of offsetting derivative assets and liabilities

						Gross Amounts not Offset
			Gross Amounts	Net Amounts		in the Statement of
			Offset in the	Presented in		Financial Position
	Gross		Statement of	the Statement of		Financial	Cash Collateral	Net
	Amount		Financial Position	Financial Position		Instruments	Received	Amount
Description
March 31, 2020
Derivative Assets	$	8,830	—	$	8,830	—	—	$	8,830
Total Assets	$	8,830	—	$	8,830	—	—	$	8,830
Derivative Liabilities	$	505	—	$	505	—	—	$	505
Total Liabilities	$	505	—	$	505	—	—	$	505
December 31, 2019
Derivative Assets	$	2,758	—	$	2,758	—	—	$	2,758
Total Assets	$	2,758	—	$	2,758	—	—	$	2,758
Derivative Liabilities	$	401	—	$	401	—	—	$	401
Total Liabilities	$	401	—	$	401	—	—	$	401

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CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Current Assets:
Cash and equivalents	$ 410,840	$ 241,970
Accounts and notes receivable, less current expected credit loss ("CECL") of $5,657 in 2020 and $3,626 in 2019	602,027	558,428
Inventories	371,859	375,795
Prepaid and other	129,926	115,048
Total Current Assets	1,514,652	1,291,241
Property, Plant and Equipment:
Buildings and improvements	502,706	504,328
Machinery and equipment	2,506,084	2,521,737
Property, Plant and Equipment, Gross	3,008,790	3,026,065
Less: Accumulated depreciation	(1,961,683)	(1,963,520)
Property, Plant and Equipment, Net	1,047,107	1,062,545
Land	24,312	25,133
Total Property, Plant and Equipment	1,071,419	1,087,678
Other Assets:
Investments in equity securities	39,167	8,396
Goodwill	756,081	763,461
Intangible assets	284,121	291,084
Operating lease right-of-use assets	65,925	72,377
Miscellaneous	45,187	47,882
Total Other Assets	1,190,481	1,183,200
Total Assets	3,776,552	3,562,119
Current Liabilities:
Notes payable, revolving credit facility and overdrafts	220,511	44,259
Current maturities of long-term obligations, net of unamortized debt issuance costs	65,049	65,988
Accounts payable, accrued and other liabilities	605,738	573,028
Total Current Liabilities	891,298	683,275
Long-term obligations, net of unamortized debt issuance costs	1,075,745	1,085,453
Deferred Liabilities and Other:
Deferred income taxes	39,795	41,388
Retirement and deferred compensation plans	104,140	101,225
Operating lease liabilities	49,004	55,276
Deferred and other non-current liabilities	28,947	23,250
Commitments and contingencies
Total Deferred Liabilities and Other	221,886	221,139
AptarGroup, Inc. stockholders' equity
Common stock, $.01 par value, 199 million shares authorized, 68.9 and 68.6 million shares issued as of March 31, 2020 and December 31, 2019, respectively	689	686
Capital in excess of par value	785,567	770,596
Retained earnings	1,554,665	1,523,820
Accumulated other comprehensive (loss)	(381,058)	(341,948)
Less treasury stock at cost, 4.7 and 4.8 million shares as of March 31, 2020 and December 31, 2019, respectively	(372,573)	(381,238)
Total AptarGroup, Inc. Stockholders' Equity	1,587,290	1,571,916
Noncontrolling interests in subsidiaries	333	336
Total Stockholders' Equity	1,587,623	1,572,252
Total Liabilities and Stockholders' Equity	$ 3,776,552	$ 3,562,119

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INVESTMENT IN EQUITY SECURITIES

3 Months Ended

Mar. 31, 2020

Equity Method and Other Investments [Abstract]

INVESTMENT IN EQUITY SECURITIES

NOTE 18 –INVESTMENT IN EQUITY SECURITIES

Our investment in equity securities consisted of the following:

	March 31,		December 31,
	2020		2019
Equity Method Investments:
BTY	$	31,043	$	119
Kali Care		3,772		3,881
Desotec GmbH		811		858
Other Investments		3,541		3,538
	$	39,167	$	8,396

Equity method investments

BTY

On October 1, 2019 we entered into a strategic definitive agreement to acquire 49% of the equity interests in 3 related companies: Suzhou Hsing Kwang, Suqian Hsing Kwang and Suzhou BTY (collectively referred to as “BTY”), contingent on the settlement date of the transaction. We have a call option to acquire an additional 26% to 31% of BTY’s equity interests following the initial lock-up period of 5 years based on a predetermined formula. Subsequent to the second lock-up period, which ends 3 years subsequent to the initial lock-up period, we have a call option to acquire the remaining equity interests of BTY based on a predetermined formula. Additionally, the selling shareholders of BTY have a put option for the remaining equity interest to be acquired by Aptar based on a predetermined formula. The BTY entities are leading Chinese manufacturers of high quality, decorative metal components, metal-plastic sub-assemblies, and complete color cosmetics packaging solutions for the beauty industry. On January 1, 2020, the transaction closed for an approximate purchase price of $31 million for our 49% share. As of March 31, 2020, we paid approximately $20 million, with the remaining amount of $11 million included in Accounts payable, accrued and other liabilities. The amount is payable after certain conditions under the definitive agreement are fulfilled and is expected to be paid during the second quarter of 2020.

Kali Care

During 2017, we invested $5 million to acquire 20% of the equity interests in Kali Care, a technology company that provides digital monitoring systems for medical devices.

Desotec GmbH

During 2009, we invested €574 thousand to acquire 23% of the equity interests in Desotec GmbH, a leading manufacturer of special assembly machines for bulk processing for the pharmaceutical, beauty and home and food and beverages markets.

Healthcare, Inc.

Subsequent to the quarter end, on April 1, 2020, we invested $5 million to acquire 30% of the equity interests in Healthcare, Inc., Shanghai Sonmol Internet Technology Co., Ltd. and its subsidiary, Shanghai Sonmol Medical Equipment Co., Ltd., a pharmaceutical company that provides connected devices for asthma control.

Other investments

During August 2019, we invested an aggregate amount of $3.5 million in two preferred equity investments in sustainability companies Loop and Purecycle Technologies that are accounted for at cost less impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. There were no indications of impairment nor were there any changes from observable price changes noted in the three months ended March 31, 2020.

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STOCK-BASED COMPENSATION

3 Months Ended

Mar. 31, 2020

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

NOTE 14 – STOCK-BASED COMPENSATION

We issue restricted stock units (“RSUs”), which consist of time-based and performance-based awards, to employees under stock awards plans approved by stockholders. In addition, RSUs are issued to non-employee directors under a Restricted Stock Unit Award Agreement for Directors pursuant to the Company’s 2018 Equity Incentive Plan. RSUs granted to employees vest according to a specified performance period and/or vesting period. Time-based RSUs generally vest over three years. Performance-based RSUs vest at the end of the specified performance period, generally three years, assuming required performance or market vesting conditions are met. Performance-based RSUs have one of two vesting conditions: (1) based on our internal financial performance metrics and (2) based on our total shareholder return (“TSR”) relative to total shareholder returns of an industrial peer group. At the time of vesting, the vested shares of common stock are issued in the employee’s name. In addition, RSU awards are generally net settled (shares are withheld to cover the employee tax obligation). RSUs granted to directors are only time-based and generally vest over one year.

The fair value of both time-based RSUs and performance-based RSUs pertaining to internal performance metrics is determined using the closing price of our common stock on the grant date. The fair value of performance-based RSUs pertaining to TSR is estimated using a Monte Carlo simulation. Inputs and assumptions used to calculate the fair value are shown in the table below. The fair value of these RSUs is expensed over the vesting period using the straight-line method or using the graded vesting method when an employee becomes eligible to retain the award at retirement.

Three Months Ended March 31,		2020			2019
Fair value per stock award	$	94.98		$	134.97
Grant date stock price	$	83.93		$	104.51
Assumptions:
Aptar's stock price expected volatility		23.80	%		16.50	%
Expected average volatility of peer companies		48.50	%		31.90	%
Correlation assumption		63.50	%		37.40	%
Risk-free interest rate		0.31	%		2.19	%
Dividend yield assumption		1.72	%		1.30	%

A summary of RSU activity as of March 31, 2020 and changes during the three month period then ended is presented below:

	Time-Based RSUs			Performance-Based RSUs
		Weighted Average			Weighted Average
	Units	Grant-Date Fair Value		Units	Grant-Date Fair Value
Nonvested at January 1, 2020	480,729	$	95.45	181,680	$	117.26
Granted	176,424		81.75	206,408		90.85
Vested	(112,515)		82.64	—		—
Forfeited	(217)		100.14	(589)		120.61
Nonvested at March 31, 2020	544,421	$	92.11	387,499	$	103.23

Included in the March 31, 2020 time-based RSUs are 11,490 units granted to non-employee directors.

Compensation expense recorded attributable to RSUs for the first three months of 2020 and 2019 was approximately $8.3 million and $4.7 million, respectively. The actual tax benefit realized for the tax deduction from RSUs was approximately $1.5 million in the three months ended March 31, 2020. The fair value of units vested during the three months ended March 31, 2020 and 2019 was $9.3 million and $2.7 million, respectively. The intrinsic value of units vested during the three months ended March 31, 2020 and 2019 was $11.5 million and $3.2 million, respectively. As of March 31, 2020, there was $62.7 million of total unrecognized compensation cost relating to RSU awards which is expected to be recognized over a weighted-average period of 2.3 years.

Historically we issued stock options to our employees and non-employee directors. Beginning in 2019, we no longer issue stock options. Stock options were awarded with the exercise price equal to the market price on the date of grant and generally vest over three years and expire 10 years after grant. Compensation expense attributable to employee stock options for the first three months of 2020 was approximately $0.9 million ($0.7 million after tax). Approximately $0.7 million of the compensation expense was recorded in selling, research & development and administrative expenses and the balance was recorded in cost of sales. Compensation expense attributable to stock options for the first three months of 2019 was approximately $1.8 million ($1.5 million after tax). Approximately $1.6 million of the compensation expense was recorded in selling, research & development and administrative expenses and the balance was recorded in cost of sales. The reduction in stock option expense is due to our move to RSUs as discussed above. For stock option grants, we used historical data to estimate expected life and volatility.

A summary of option activity under our stock plans during the three months ended March 31, 2020 is presented below:

	Stock Awards Plans					Director Stock Option Plans
			Weighted Average				Weighted Average
		Options	Exercise Price			Options	Exercise Price
Outstanding, January 1, 2020		5,044,180	$	68.32		135,251	$	58.45
Granted		—		—		—		—
Exercised		(292,090)		55.16		(21,251)		51.20
Forfeited or expired		(6,630)		65.60		—		—
Outstanding at March 31, 2020		4,745,460	$	69.20		114,000	$	59.80
Exercisable at March 31, 2020		4,583,864	$	68.43		114,000	$	59.80
Weighted-Average Remaining Contractual Term (Years):
Outstanding at March 31, 2020		5.3				3.2
Exercisable at March 31, 2020		5.1				3.2
Aggregate Intrinsic Value:
Outstanding at March 31, 2020	$	143,971			$	4,530
Exercisable at March 31, 2020	$	142,195			$	4,530
Intrinsic Value of Options Exercised During the Three Months Ended:
March 31, 2020	$	18,202			$	1,385
March 31, 2019	$	14,047			$	51

The grant date fair value of options vested during the three months ended March 31, 2020 and 2019 was $7.6 million and $12.2 million, respectively. Cash received from option exercises was approximately $18.6 million and the actual tax benefit realized for the tax deduction from option exercises was approximately $4.8 million in the three months ended March 31, 2020. As of March 31, 2020, the remaining valuation of stock option awards to be expensed in future periods was $1.5 million and the related weighted-average period over which it is expected to be recognized is 0.9 years.

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CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019	Mar. 31, 2019	Dec. 31, 2018
Restricted cash included in the line item prepaid and other on the Condensed Consolidated Balance Sheets as shown below represents amounts held in escrow.
Cash and equivalents	$ 410,840	$ 241,970	$ 217,377
Restricted cash included in prepaid and other	4,003
Total Cash and Equivalents and Restricted Cash shown in the Statement of Cash Flows	$ 414,843	$ 246,973	$ 217,377	$ 266,823

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INVESTMENT IN EQUITY SECURITIES (Tables)

3 Months Ended

Mar. 31, 2020

Equity Method and Other Investments [Abstract]

Schedule of investments in equity securities

	March 31,		December 31,
	2020		2019
Equity Method Investments:
BTY	$	31,043	$	119
Kali Care		3,772		3,881
Desotec GmbH		811		858
Other Investments		3,541		3,538
	$	39,167	$	8,396

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REVENUE - Contract Assets and Contract Liabilities (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Dec. 31, 2019
REVENUE.
Contract asset (current)	$ 13,457	$ 16,245
Increase / (decrease) in contract asset (current)	(2,788)
Contract liability (current)	78,974	79,305
Increase / (decrease) in contract liability (current)	(331)
Contract liability (long-term)	14,994	9,779
Increase / (decrease) in contract liability (long-term)	5,215
Revenue recognized previously included in current contract liabilities	12,500
Revenue recognized previously included in current contract liabilities at beginning of the year	10,600
Unearned revenue associated with outstanding contracts	432	515
Estimated revenue to be recognized in 2020	172
Estimated revenue to be recognized in 2021	123
Estimated revenue to be recognized after 2021	137
Allowance for Credit Loss [Abstract]
Accounts and note receivable	602,027	558,428
Accounts and notes receivable, allowance for doubtful accounts (in dollars)	$ 5,657	$ 3,626

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COMMITMENTS AND CONTINGENCIES (Details) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2020	Dec. 31, 2019	Mar. 31, 2019	Mar. 31, 2017
Brazil
Commitments and contingencies
Accrual for Environmental Loss Contingencies	$ 400,000			$ 1,500,000
Payments to settle environmental loss contingency	100,000	$ 600,000
Brazil | Reduction of gross receipts tax
Commitments and contingencies
Recovery of part of claim			$ 2,700,000
Brazil | Reduction of gross receipts tax | Cost of Sales
Commitments and contingencies
Recovery of part of claim			1,700,000
Brazil | Reduction of gross receipts tax | Interest Income
Commitments and contingencies
Recovery of part of claim			$ 1,000,000.0
Brazil | Minimum | Reduction of gross receipts tax
Commitments and contingencies
Estimated potential gain contingency, recoveries	2,000,000
Brazil | Maximum | Reduction of gross receipts tax
Commitments and contingencies
Estimated potential gain contingency, recoveries	8,000,000
Indemnification agreements
Commitments and contingencies
Liabilities recorded under indemnification agreements	0	0
Tax Assessment | Brazil
Commitments and contingencies
Estimated loss contingency		6,100,000
Loss contingency liability recorded	0
Tax Assessment, Interest | Brazil
Commitments and contingencies
Estimated loss contingency		2,300,000
Tax Assessment, Penalites | Brazil
Commitments and contingencies
Estimated loss contingency		$ 800,000
Fire damage | France
Commitments and contingencies
Estimated potential gain contingency, recoveries	0
Insurance receivable	$ 0

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Fair Value of Derivative Instruments in the Consolidated Balance Sheets) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Fair Value of Derivative Instruments
Derivative Assets	$ 8,830		$ 2,758
Derivative Liabilities	505		401
Foreign Exchange Contract, Amount of Gain (Loss) Recognized in Income on Derivative, not designated as hedging instruments	1,747	$ (263)
Foreign Exchange Contracts
Fair Value of Derivative Instruments
Aggregate amount of forward exchange contracts	56,100
Foreign Exchange Contract, Amount of Gain (Loss) Recognized in Income on Derivative, not designated as hedging instruments	1,747	$ (263)
Derivative Contracts Not Designated as Hedging Instruments
Fair Value of Derivative Instruments
Derivative Assets	2,061		206
Derivative Liabilities	505		401
Derivative Contracts Not Designated as Hedging Instruments | Foreign Exchange Contracts | Prepaid and other
Fair Value of Derivative Instruments
Derivative Assets	2,061		206
Derivative Contracts Not Designated as Hedging Instruments | Foreign Exchange Contracts | Accounts payable and accrued liabilities
Fair Value of Derivative Instruments
Derivative Liabilities	505		401
Derivative Contracts Designated as Hedging Instruments
Fair Value of Derivative Instruments
Derivative Assets	6,769		2,552
Derivative Contracts Designated as Hedging Instruments | Cross Currency Swap Contract | Prepaid and other
Fair Value of Derivative Instruments
Derivative Assets	$ 6,769		$ 2,552

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SEGMENT INFORMATION (Summary of Reportable Segments) (Details) $ in Thousands	3 Months Ended		27 Months Ended
	Mar. 31, 2020 USD ($) segment	Mar. 31, 2019 USD ($)	Mar. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)
Financial information regarding the Company's reportable segments
Number of reportable segments | segment	3
Net sales	$ 721,553	$ 744,460
Acquisition related costs	(2,274)
Total Restructuring Initiatives	4,839	9,530
Depreciation and amortization	50,806	47,489
Interest expense	(8,388)	(9,214)
Interest income	175	1,748
Income before Income Taxes	78,036	89,999
Capital Expenditures	61,625	51,742
Total Assets	3,776,552		$ 3,776,552	$ 3,562,119
Employee severance
Financial information regarding the Company's reportable segments
Total Restructuring Initiatives	4,066
Business Transformation
Financial information regarding the Company's reportable segments
Total Restructuring Initiatives	4,800	9,500
Capital Expenditures			$ 40,000
Beauty + Home
Financial information regarding the Company's reportable segments
Net sales	324,560	367,659
Adjusted EBITDA	34,247	53,191
Total Restructuring Initiatives	4,907	8,269
Pharma
Financial information regarding the Company's reportable segments
Net sales	297,196	272,701
Adjusted EBITDA	108,342	97,357
Total Restructuring Initiatives	(31)	326
Food + Beverage
Financial information regarding the Company's reportable segments
Net sales	99,797	104,100
Adjusted EBITDA	15,407	16,691
Total Restructuring Initiatives	103	510
Corporate & Other
Financial information regarding the Company's reportable segments
Adjusted EBITDA	(13,828)	(12,755)
Total Restructuring Initiatives	(140)	425
Operating segment
Financial information regarding the Company's reportable segments
Net sales	730,357	752,724
Operating segment | Beauty + Home
Financial information regarding the Company's reportable segments
Net sales	330,466	373,503
Operating segment | Pharma
Financial information regarding the Company's reportable segments
Net sales	299,590	274,494
Operating segment | Food + Beverage
Financial information regarding the Company's reportable segments
Net sales	100,301	104,727
Intersegment
Financial information regarding the Company's reportable segments
Net sales	8,804	8,264
Intersegment | Beauty + Home
Financial information regarding the Company's reportable segments
Net sales	5,906	5,844
Intersegment | Pharma
Financial information regarding the Company's reportable segments
Net sales	2,394	1,793
Intersegment | Food + Beverage
Financial information regarding the Company's reportable segments
Net sales	$ 504	$ 627