UNITED STATES OF AMERICA
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the Fiscal Year Ended December 31, 2001 and 2000
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
COMMISSION FILE NUMBER 1-11846
A. Full title of the Plan:
APTARGROUP, INC. PROFIT SHARING AND SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
APTARGROUP, INC.
475 West Terra Cotta Avenue, Suite E
Crystal Lake, Illinois 60014
Telephone: (815) 477-0424
APTARGROUP, INC.
PROFIT SHARING AND SAVINGS PLAN
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INDEX TO FINANCIAL STATEMENTS AND SCHEDULES
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Page
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Report of Independent Accountants 1
Financial statements:
Statements of Net Assets Available for
Benefits, at December 31, 2001 and 2000 2
Statement of Changes in Net Assets Available
for Benefits, for the year ended December 31, 2001 3
Notes to Financial Statements 4-9
Supplemental schedule:
Assets Held for Investment Purposes at the end of
December 31, 2001 (Schedule 4i) 10
Consent of Independent Accountants Exhibit 23
Note: All other schedules of additional financial information require by Section
2520.103-10 of the Department of Labor Rules and Regulations for Reporting and
Disclosure under ERISA have been omitted because they are not applicable.
REPORT OF INDEPENDENT ACCOUNTANTS
---------------------------------
To the Participants and
Administrative Committee of the
AptarGroup, Inc.
Profit Sharing and Savings Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the AptarGroup, Inc. Profit Sharing and Savings Plan (the "Plan") at December
31, 2001 and 2000, and the changes in net assets available for benefits for the
year ended December 31, 2001 in conformity with accounting principles generally
accepted in the United States of America. These financial statements are the
responsibility of the Plan's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these statements in accordance with auditing standards generally
accepted in the United States of America, which require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of Assets Held
for Investment Purposes is presented for purpose of additional analysis and is
not a required part of the basic financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. This supplemental schedule is the responsibility of the Plan's management.
The supplemental schedule has been subjected to the auditing procedures applied
in the audit of the basic financial statements and, in our opinion, is fairly
stated in all material respects in relation to the basic financial statements
taken as a whole.
PricewaterhouseCoopers LLP
Chicago, Illinois
June 7, 2002
APTARGROUP, INC.
PROFIT SHARING AND SAVINGS PLAN
-------------------------------
STATEMENTS OF NET ASSETS AVAILABLE
FOR BENEFITS
AT DECEMBER 31, 2001 AND 2000
-----------------------------
2001 2000
--------------- --------------
Assets:
Investments, at fair value $ 56,924,139 $ 52,747,489
Participant loans 1,933,064 1,662,612
Contributions Receivable:
Participant 191,846 385,274
Employer 55,517 119,877
--------------- --------------
NET ASSETS AVAILABLE FOR BENEFITS $ 59,104,566 $ 54,915,252
=============== ==============
The accompanying notes are an integral part of these statements.
2
APTARGROUP, INC.
PROFIT SHARING AND SAVINGS PLAN
-------------------------------
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE
FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 2001
------------------------------------
2001
---------------
Income from investments:
Dividends $ 994,999
Interest 150,746
Net depreciation in fair value of assets (3,649,849)
Contributions:
Participant 4,099,875
Employer 1,383,678
Plan transfer in 4,985,805
---------------
Total Additions 7,965,254
---------------
Benefits paid to participants (3,739,256)
Administrative expenses (36,684)
---------------
Total Deductions (3,775,940)
---------------
Net increase in net assets available
for benefits for the period 4,189,314
Net assets available for benefits, beginning
of the period 54,915,252
---------------
Net assets available for benefits, end
of the period $ 59,104,566
===============
The accompanying notes are an integral part of these statements.
3
APTARGROUP, INC.
PROFIT SHARING AND SAVINGS PLAN
-------------------------------
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2001 AND 2000
--------------------------
NOTE 1 - DESCRIPTION OF THE PLAN
--------------------------------
The AptarGroup, Inc., Profit Sharing and Savings Plan (the "Plan"), established
on April 22, 1993, is a participant-directed defined contribution plan which
covers eligible full-time and part-time non-union employees of AptarGroup, Inc.
and certain of its subsidiaries (the "Company" or the "Employer"). The Plan is
administered by a committee appointed by the Company, consisting of Company
employees.
During the year two plans of the Emsar subsidiary were merged into the Plan. On
November 1, 2001 the Philson Plan was merged with and into the Plan. On December
20, 2001 the Emson Plan was merged with and into the Plan. The participant
account balances from the Philson Plan and the Emson Plan were merged into the
existing participant accounts under the Plan, creating one account under the
Plan for each participant.
As of October 1, 2001, a full-time employee becomes eligible to participate on
the first day of the month following 30 days of service. A part-time employee
becomes eligible to participate after completion of 1000 hours of service in any
consecutive twelve-month period. Participation is elective and is exercised by
means of authorizing contributions of salary to the Plan of not less than 1
percent and not more than 16 percent of earnings (subject to Internal Revenue
Code limitations). Participants' earnings are generally defined as total
compensation for services rendered to the Employer. Participants may elect to
suspend their contributions at any time. Eligible employees will not share in
any Employer contributions for any period in which they voluntarily suspend
their contributions or do not participate in the Plan. Active participation can
be elected again on the next regular enrollment date.
Contributions
The amount of Employer contributions is determined annually by the Employer.
Such contributions are computed as a matching percentage of each participant's
contribution within specified limits. The Company matched 50% of participant
contributions up to the first 6% for the years ended December 31, 2001 and 2000.
Fidelity Management Trust Company is the trustee for the AptarGroup, Inc. Profit
Sharing and Savings Plan, which includes the following investment funds
available to participants:
Retirement Government Money Market Fund- Assets included in this fund are
---------------------------------------
invested in U.S. government securities and repurchase agreements for those
securities. The goal of this fund is to preserve a level of current income as is
consistent with the security of principal and liquidity.
Magellan Fund- Assets included in this fund are primarily invested in common
-------------
stock and securities convertible into common stock with the intention of seeking
capital appreciation.
4
APTARGROUP, INC.
PROFIT SHARING AND SAVINGS PLAN
-------------------------------
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2001 AND 2000
--------------------------
Managed Income Fund- Assets included in this fund are primarily invested in
-------------------
investment contracts offered by major insurance companies and other approved
financial institutions and in certain types of fixed income securities. The goal
of this fund is to preserve a principal investment while earning interest
income.
Growth and Income Fund- Assets included in this fund are normally invested in
----------------------
common stock with a focus on those that pay current dividends and show potential
for capital appreciation.
Overseas Fund- The fund normally invests at least 65% of total assets in foreign
-------------
securities, and invests primarily in common stock. The goal of the fund is to
increase the value of investment over the long term through capital growth.
Asset Manager- Assets included in this fund are invested in all basic types of
-------------
U.S. and foreign investments including, but not limited to: stocks, bonds, and
short-term and money market instruments. The goal of this fund is to provide
high total return with reduced risk over the long term.
Small Cap Independence Fund- The fund normally invests at least 65% of total
---------------------------
assets in securities of companies with small market capitalizations. The fund
will normally invest in common stock. The goal of the fund is capital
appreciation.
AptarGroup Stock Fund- Assets included in this fund are invested in the stock of
---------------------
the employer or its affiliates. Performance of this stock is directly tied to
the performance of the company as well as to that of the stock market as a
whole.
A participant may elect to transfer certain portions of his or her account in
the Plan from one fund to another up to twelve times per year subject to certain
restrictions between the Retirement Government Money Market Fund and Managed
Income Fund.
5
APTARGROUP, INC.
PROFIT SHARING AND SAVINGS PLAN
-------------------------------
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2001 AND 2000
--------------------------
Vesting
Each participant is fully vested in his or her contributions at all times.
Vesting of the Employer contribution occurs at the rate of 20 percent per year
on a cumulative basis for each year of service with a participating Employer.
Upon withdrawal from the Plan, the participant will receive the amount of his or
her contributions plus the vested portion of his or her Employer contributions.
When a participant terminates employment for any reason other than retirement
after age 65, death, or disability, the nonvested amounts of the Employer
contributions will be used to reduce contributions of the Employer. The amounts
of such forfeitures in each of the years ending December 31, 2001 and 2000 were
$31,048 and $35,857, respectively. Nonvested amounts for participants who
terminate employment for any reason other than retirement after age 65, death,
or disability, will be reinstated if reemployment by the Employer occurs prior
to incurring five consecutive one year breaks in services as defined by the Plan
agreement.
Further information about the Plan and the vesting and benefit provisions is
contained in the Summary Plan Description, which is available from the Plan
Administrator.
Participant Loans
The Plan provides that a participant may, for specified reasons, borrow from the
Plan an amount not to exceed the lesser of 50 percent of the participant's
vested account balance or $50,000. Each participant loan is evidenced by a note
and is considered an investment to that participant's respective account. Each
participant note carries an interest rate equal to the prime rate plus one
percent (at December 31, 2001 interest rates on outstanding notes ranged from
6.0% to 10.5%) charged by the Trustee on the date of the loan, and repayment
occurs through payroll withholding over a period not to exceed 60 months.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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Basis of Accounting
The financial statements of the Plan have been prepared on the accrual basis of
accounting.
Valuation of Investments
All investments are stated at current market prices in actively traded markets.
Participant loans are valued at cost, which approximates fair market value.
Contributions
Employer and employee contributions are invested directly in appropriate funds
based upon employee elections made at the date of enrollment or through
authorized changes in elections.
6
APTARGROUP, INC.
PROFIT SHARING AND SAVINGS PLAN
-------------------------------
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2001 AND 2000
--------------------------
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of net assets and changes thereto. Actual amounts
could differ from those estimates.
Security Transactions and Investment Income
Purchases and sales of securities, including related gains and losses, are
recorded as of the trade date. Unsettled security investments represent
transactions entered into prior to the end of the accounting period for which
cash settlement is made in a subsequent period.
Interest income is recorded when earned. Dividend income is recorded on the
ex-dividend date.
In accordance with the policy of stating investments at current value, net
appreciation or depreciation is reflected in the Statement of Changes in Net
Assets Available for Benefits. This net appreciation or depreciation consists of
realized and unrealized gains and losses. Realized losses and gains are
calculated as the difference between proceeds from a sales transaction and cost
determined on an average basis. Unrealized losses and gains are calculated as
the change in the fair value between the beginning of the year (or purchase date
if later) and the end of the year.
Reconciliation of Financial Statements to Form 5500
The Plan follows the method of reporting benefit payment obligations proscribed
by the American Institute of Certified Public Accounts (AICPA) in its guidance
for accounting and disclosure by benefit plan. Based on this accounting method,
participant distributions payable at the year-end are not presented as a
liability in the Statement of Net Assets for Plan Benefits. This treatment may
result in a difference between benefit payments in the Plan's form 5500 and the
benefit payments reported in the financial statements. There were no benefit
obligations payable at December 31, 2001 or 2000.
Trustee and Administrative Expenses
Expenses incurred in the administration of the Plan and Marquette Investment
Manager fees are paid by the Company, except for loan service fees, which are
paid by the participants.
7
APTARGROUP, INC.
PROFIT SHARING AND SAVINGS PLAN
-------------------------------
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2001 AND 2000
--------------------------
NOTE 3 - RELATED PARTY TRANSACTIONS
-----------------------------------
Related party transactions consisted of loans made to participants and
investments in the AptarGroup Stock Fund. Certain Plan investments are shares of
mutual funds managed by Fidelity. Fidelity is the trustee as defined by the Plan
and, therefore, these transactions qualify as party-in-interest. Fees paid by
the Plan to Fidelity for the trustee and investment management services amounted
to $3,535 and $0 for the years ended December 31, 2001 and 2000, respectively.
These transactions are not prohibited transactions as defined under ERISA.
NOTE 4 - FEDERAL INCOME TAX STATUS
----------------------------------
The Internal Revenue Service has determined and informed the Company by a letter
dated April 4, 2002 that the Plan and related Trust are designed in accordance
with applicable sections of the Internal Revenue Code ("IRC"). Therefore, no
provision for income taxes has been included in the Plan's financial statements.
NOTE 5 - RISKS AND UNCERTAINTIES
--------------------------------
Investment securities are exposed to various risks, such as interest rate,
market and credit. Due to the level of risk associated with certain investment
securities and the level of uncertainty related to changes in the value of
investment securities, it is at least reasonably possible that changes in risks
in the near term would materially affect participants' account balances and the
amounts reported in the statements of net assets available for plan benefits and
the statements of changes in net assets available for plan benefits.
NOTE 6 - AMENDMENT AND TERMINATION OF PLAN
------------------------------------------
The Plan may be amended at any time by the Company. However, no amendment may
adversely affect the current rights of the participants in the Plan with respect
to contributions made prior to the date of the amendment.
Although it has not expressed any intent to do so, the Company reserves the
right to discontinue Employer contributions or to terminate its participation in
the Plan at any time. In the event of a partial or complete termination of the
Plan, all Participants with respect to whom the Plan is being terminated shall
be fully vested in their Accounts as of the date of the termination of the Plan.
If a Member remains an Employee of the Company or Affiliates following the
termination of the Plan, his benefits shall remain in the Trust Fund until his
Severance from Service and then shall be paid to him in accordance with the
provisions of the Plan.
8
APTARGROUP, INC.
PROFIT SHARING AND SAVINGS PLAN
-------------------------------
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2001 AND 2000
--------------------------
The Plan is subject to the provisions of the Employee Retirement Income Security
Act of 1974 (ERISA) applicable to defined contribution plans. Since the Plan
provides for an individual account for each participant and for benefits based
solely on the amount contributed to the participant's account and any income,
expenses, gains and losses attributed thereto, its benefits are not insured by
the Pension Benefit Guaranty Corporation pursuant to Title IV of ERISA.
NOTE 7 - INVESTMENTS
--------------------
The fair values of individual investments that represent 5% or more of the
Plan's assets are as follows:
December 31,
----------------------------
2001 2000
---- ----
Money Market Fund -
Fidelity Retirement Government
Money Market Fund $ 12,831,819 $ 7,093,061
Magellan Fund -
Fidelity Magellan Fund Portfolio 20,664,700 23,280,124
AptarGroup Stock Fund -
AptarGroup, Inc. Stock 7,197,157 5,860,831
Growth and Income Fund -
Fidelity Growth and Income 11,372,792 12,576,503
9
Schedule 4i
APTARGROUP, INC.
PROFIT SHARING AND SAVINGS PLAN
-------------------------------
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AT THE END OF DECEMBER 31, 2001
-------------------------------
Description
Identity of Issue of Investment Fair Value
----------------------------- --------------- -------------
*Fidelity Retirement
Government Money Market
Portfolio Mutual Fund $ 12,831,819
*Fidelity Magellan Fund
Portfolio Mutual Fund 20,664,700
*AptarGroup, Inc. Stock Common Stock 7,197,157
*Fidelity Growth and Income
Portfolio #027-0254927262 Mutual Fund 11,372,792
*Fidelity Managed Income
Fund Mutual Fund 2,407,965
*Fidelity Overseas Fund Mutual Fund 1,153,073
*Fidelity Asset Manager Mutual Fund 975,957
*Fidelity Small Cap Independence Mutual Fund 320,676
*Participant Loans - Loan 1,933,064
Range of interest rates 6.0% - 10.5% ------------
$ 58,857,203
============
* Party-in-interest
10
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, AptarGroup,
Inc., as plan administrator, has duly caused this annual report to be signed on
its behalf by the undersigned hereunto duly authorized.
AptarGroup, Inc.
By: AptarGroup, Inc., as Plan Administrator
By: /s/ Lawrence Lowrimore
---------------------------------
Lawrence Lowrimore
Vice President-Human Resources
June 26, 2002
11
EXHIBIT INDEX
Exhibit No. Description Sequential Page No.
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23 Consent of Independent Accountants 13
12