<PAGE>
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the registrant /X/
Filed by a party other than the registrant / /
Check the appropriate box:
/ / Preliminary proxy statement
/X/ Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
/ / Confidential, for use of the Commission only (as permitted by Rule
14a-6(c)(2))
APTARGROUP, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transaction applies:
-----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-----------------------------------------------------------------------
(5) Total fee paid:
-----------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount previously paid:
-----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-----------------------------------------------------------------------
(3) Filing Party:
-----------------------------------------------------------------------
(4) Date Filed:
-----------------------------------------------------------------------
<PAGE>
AptarGroup, Inc.
475 West Terra Cotta Avenue, Suite E
Crystal Lake, Illinois 60014
(815) 477-0424
- ----------------------------------
[LOGO]
DEAR STOCKHOLDER:
It is my pleasure to invite you to attend the 1997 Annual Meeting of
Stockholders of AptarGroup, Inc. to be held at 9:00 a.m., local time, on
Wednesday, May 14, 1997. At the meeting, management of the Company will report
on the Company's 1996 performance and the plans of the Company. The meeting will
be held at the offices of Sidley & Austin, One First National Plaza, 55th Floor,
Chicago, Illinois, 60603.
Included with this letter are the Notice of Annual Meeting and the Proxy
Statement. The Proxy Statement describes the business to be transacted at the
meeting and provides additional information concerning the Company which may be
of interest to you when voting your shares.
The vote of each stockholder is important to us. Whether or not you expect
to attend the Annual Meeting, I urge you to complete, sign, date and return the
accompanying proxy card as soon as possible in the accompanying envelope. This
will ensure that your shares will be represented at the Annual Meeting.
Sincerely,
/s/ Carl A. Siebel
Carl A. Siebel
PRESIDENT AND CHIEF EXECUTIVE OFFICER
April 9, 1997
<PAGE>
AptarGroup, Inc.
475 West Terra Cotta Avenue, Suite E
Crystal Lake, Illinois 60014
- -----------------------------------------
NOTICE OF
[LOGO]
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 14, 1997
- -----------------------------------------
TO THE STOCKHOLDERS:
The Annual Meeting of Stockholders of AptarGroup, Inc. will be held on
Wednesday, May 14, 1997 at 9:00 a.m., local time, at the offices of Sidley &
Austin, One First National Plaza, 55th Floor, Chicago, Illinois, 60603 for the
following purposes:
1. To elect three directors to serve until the 2000 annual meeting of
stockholders and the election and qualification of their successors.
2. To transact such other business as may properly be brought before the
meeting.
The annual meeting may be postponed or adjourned from time to time without
any notice other than announcement at the meeting, and any and all business for
which notice is hereby given may be transacted at any such postponed or
adjourned meeting.
The Board of Directors has fixed the close of business on March 21, 1997 as
the record date for determination of stockholders entitled to notice of and to
vote at the meeting.
A list of stockholders entitled to vote at the annual meeting will be
available for examination by any stockholder, for any purposes germane to the
meeting, during ordinary business hours at Sidley & Austin, One First National
Plaza, 55th Floor, Chicago, Illinois, 60603, during the ten days preceding the
meeting.
Stockholders are requested to complete, sign and date the enclosed proxy,
which is solicited by the Board of Directors, and promptly return it in the
accompanying envelope whether or not you plan to attend the meeting in person.
You may revoke your proxy at any time before it is voted.
By Order of the Board of Directors
/s/ Stephen J. Hagge
STEPHEN J. HAGGE
SECRETARY
Crystal Lake, Illinois
April 9, 1997
<PAGE>
[LOGO]
- -------------------------------
P R O X Y S T A T E M E N T
- ----------------------------
This proxy statement is furnished in connection with the solicitation by the
Board of Directors of AptarGroup, Inc. (herein called "AptarGroup" or the
"Company") of proxies for use at the Annual Meeting of Stockholders to be held
on Wednesday, May 14, 1997 at 9:00 a.m., local time, at the offices of Sidley &
Austin, One First National Plaza, 55th Floor, Chicago, Illinois, 60603, and at
any postponement or adjournment thereof.
All shares of the Company's Common Stock entitled to vote at the annual
meeting which are represented by properly executed proxies will, unless such
proxies have been revoked, be voted in accordance with the instructions given in
such proxies. A stockholder may (i) vote for the election of the three nominees
named below to serve until the 2000 annual meeting of stockholders, (ii)
withhold authority to vote for all such nominees or (iii) vote for the election
of all such nominees, but withhold authority to vote for an individual nominee
by writing such individual nominee's name in the space provided on the proxy.
Proxies in the accompanying form, properly executed and received by the Company
prior to the annual meeting and not revoked, will be voted as directed therein.
In the absence of a specific direction from a stockholder, the stockholder's
proxy will be voted "FOR" the election of the three director nominees named
below. If a proxy is marked to indicate that all or a portion of the shares
represented by such proxy are not being voted with respect to a particular
matter, such non-voted shares will not be considered present and entitled to
vote on such matter, although such shares may count for purposes of determining
the presence of a quorum.
The affirmative vote of a plurality of the shares present in person or by
proxy at the annual meeting and entitled to vote in the election of directors is
required to elect directors. Accordingly, the three persons receiving the
greatest number of votes will be elected to serve as directors. Therefore,
withholding authority to vote for a director and non-voted shares with respect
to the election of directors will not affect the outcome of the election of
directors.
The Board of Directors knows of no other business which will be presented at
the meeting. If other matters properly come before the annual meeting, the
persons named as proxies will vote them in accordance with their best judgment.
Any stockholder who has given a proxy may revoke it at any time before it is
voted by delivering a written notice of revocation to the Secretary of the
Company, by executing a proxy bearing a later date which is voted at the annual
meeting or by attending the annual meeting and voting in person.
Proxy statements and proxies are being mailed to stockholders on or about
April 9, 1997. The mailing address of the principal executive offices of the
Company is 475 West Terra Cotta Avenue, Suite E, Crystal Lake, Illinois 60014.
The Company had outstanding 17,957,039 shares of Common Stock on March 21,
1997, the record date for the annual meeting. Each share of Common Stock
outstanding on the record date is entitled to one vote. The Common Stock is
traded on the New York Stock Exchange.
The Board of Directors recommends a vote FOR all Director nominees.
<PAGE>
ELECTION OF DIRECTORS
The Board of Directors is comprised of nine members. The Certificate of
Incorporation of the Company divides the Board of Directors into three classes,
with one class of directors elected each year for a three-year term. The terms
of Eugene L. Barnett, Ralph Gruska and Leo A. Guthart expire at the 1997 annual
meeting and each of these directors has been nominated for re-election.
If any of the director nominees is unable or fails to stand for election,
the persons named in the proxy presently intend to vote for a substitute nominee
nominated by the Nominating Committee of the Board of Directors.
The following sets forth information as to each nominee for election at this
meeting and each director continuing in office.
Nominees for election at this meeting to terms expiring in 2000:
<TABLE>
<CAPTION>
DIRECTOR
NAME SINCE AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
- --------------------------------------------------- --------- --------- ---------------------------------------------------
<S> <C> <C> <C>
Eugene L. Barnett.................................. 1993 69 Mr. Eugene Barnett is an independent consultant.
From 1976 to 1991, Mr. Barnett was Chairman and
Chief Executive Officer of The Brand Companies,
Inc. (a specialty contractor) and from 1979 to
1992, served as a Vice President of Pittway
Corporation (a manufacturer and distributor of
alarm systems and publisher of trade magazines) or
its predecessor (collectively, "Pittway"). Mr.
Barnett is a director of Pittway and National
Service Cleaning Corp. (a specialty contractor).
Ralph Gruska....................................... 1993 65 Mr. Gruska is retired. From 1989 to 1991, Mr.
Gruska served as Chairman and Chief Executive
Officer of the Cosmetics Packaging and Dispensers
Division of Cope Allman Packaging plc (a United
Kingdom packaging company).
Leo A. Guthart..................................... 1993 59 Mr. Guthart is Chairman and Chief Executive Officer
of the Ademco Security Group, a division of
Pittway specializing in burglar alarm systems. Mr.
Guthart has served as Vice Chairman of the Board
of Pittway since 1984. Mr. Guthart is a director
of Pittway and the Acorn Investment Trust (an
investment trustee) and Chairman of the Board and
director of Cylink Corporation (a data encryption,
wireless products manufacturer) ("Cylink").
</TABLE>
The Board of Directors recommends a vote FOR each of the nominees for
Director.
2
<PAGE>
Directors whose present terms continue until 1998:
<TABLE>
<CAPTION>
DIRECTOR
NAME SINCE AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
- --------------------------------------------------- ----------- --- ---------------------------------------------------
<S> <C> <C> <C>
William W. Harris.................................. 1993 57 For more than the past five years, Mr. Harris has
been a private investor and the Treasurer of
KidsPac (a political action committee). Mr. Harris
is a director of Pittway and Cylink.
Alfred Pilz........................................ 1993 66 Mr. Pilz is retired. For more than five years prior
to his retirement, Mr. Pilz was the Chief
Executive Officer of Pilz Opto Electronic GmbH (a
privately held German electronics parts company).
Carl A. Siebel..................................... 1993 62 Mr. Siebel is President and Chief Executive Officer
of AptarGroup. Prior to January 1, 1996, he was
President and Chief Operating Officer of
AptarGroup. He served as Director of Pittway's
European operations of the Seaquist Group (now a
part of AptarGroup) from 1975 until April, 1993
and was a Vice President of Pittway from 1984
until April, 1993.
</TABLE>
Directors whose present terms continue until 1999:
<TABLE>
<CAPTION>
DIRECTOR
NAME SINCE AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
- --------------------------------------------------- ----------- --- ---------------------------------------------------
<S> <C> <C> <C>
King Harris........................................ 1993 53 Mr. Harris is Chairman of the Board. Mr. Harris has
been President and Chief Executive Officer of
Pittway since 1989. Mr. Harris is a director of
Pittway and Cylink.
Ervin J. LeCoque................................... 1993 66 Mr. LeCoque retired as Chairman of the Board and
Chief Executive Officer of AptarGroup on December
31, 1995. He served as President of Pittway's
Seaquist Group for over 25 years and was a Vice
President of Pittway from 1970 to April, 1993.
Peter Pfeiffer..................................... 1993 48 Mr. Pfeiffer is Vice Chairman of the Board of
AptarGroup. Since 1978 he has served as President
of several companies which became subsidiaries of
the Company as part of the acquisition in 1993 of
Erich Pfeiffer GmbH, a holding company which
owned, subject to the existing minority interests
of the Company, a group of German based companies.
</TABLE>
King Harris and William Harris are cousins, and Alfred Pilz and Peter
Pfeiffer are brothers-in-law.
3
<PAGE>
Meetings and Committees of the Board
The Board of Directors met seven times in 1996. No director attended fewer
than 75% of the aggregate number of meetings of the Board of Directors and the
committees on which he served. The Company's Board of Directors has an Executive
Committee, Audit Committee, Compensation Committee, Investment Committee, and
Nominating Committee.
The Executive Committee consists of Mr. LeCoque as Chairman, Mr. K. Harris,
Mr. Pfeiffer, and Mr. Siebel. When the Board is not in session, the Executive
Committee may exercise certain of the powers of the Board in the management of
the business and affairs of the Company. An affirmative vote of directors
constituting at least 70% of the whole Board of Directors is required to change
the size, membership or powers of the Executive Committee, to fill vacancies in
it, or to dissolve it. The Executive Committee met four times in 1996.
The Audit Committee consists of Mr. Barnett as Chairman and Mr. Gruska. The
Audit Committee reviews and approves internal accounting and financial controls
and practices to be used in the preparation of the Company's financial
statements. The Audit Committee recommends the selection of the Company's
independent accountants. The Audit Committee met two times in 1996.
The Compensation Committee consists of Mr. Guthart as Chairman, Mr. Gruska,
and Mr. W. Harris. Mr. K. Harris served as Chairman of the Compensation
Committee until April, 1996. The Compensation Committee administers certain
compensation plans and in this capacity makes or recommends all grants or awards
under such plans. In addition, the Compensation Committee makes recommendations
to the Board with respect to the compensation of officers of AptarGroup. An
affirmative vote of directors constituting at least 70% of the whole Board is
required to change the size, membership or powers of the Compensation Committee,
to fill vacancies in it, or to dissolve it. The Compensation Committee met two
times in 1996.
The Investment Committee consists of Mr. Guthart as Chairman, Mr. Barnett
and Mr. Pfeiffer. The Investment Committee provides objectives and guidelines
for investment of funds held in trust under the various pension plans of
AptarGroup and its subsidiaries and reviews the performance of the investment
managers charged with investing such funds. The Investment Committee met one
time in 1996.
The Nominating Committee consists of Mr. K. Harris and Mr. Pfeiffer. The
Nominating Committee nominates individuals for election or re-election to the
Board at annual meetings of the stockholders, and may suggest to the Board
individuals to fill newly created directorships or vacancies. The Nominating
Committee may consider nominations suggested by stockholders. An affirmative
vote of directors constituting at least 70% of the whole board is required to
change the size, membership or powers of the Nominating Committee, to fill
vacancies in it, or to dissolve it. The Nominating Committee met one time in
1996.
Compensation Committee Interlocks and Insider Participation
The Compensation Committee consists of Mr. Guthart as Chairman, Mr. Gruska
and Mr. W. Harris. Mr. K. Harris, who ceased being a member of the Compensation
Committee in April, 1996, is the former President of Pittway Corporation of
Canada Ltd., which became a subsidiary of AptarGroup in April, 1993.
Board Compensation
Employees of AptarGroup do not receive any additional compensation for
serving as members of the Board or any of its committees. Compensation of
non-employee directors consists of an annual retainer of $10,000 payable $2,500
per quarter, plus a fee of $5,000 for each Board meeting attended in person and
$1,000 for any teleconference Board meeting. Non-employee directors who are
members of any of the five committees of the Board receive $1,000 for each
committee meeting attended in person (other than a committee meeting held on the
same day as a Board meeting) and $250 for each phone meeting of a committee. The
Chairman of the Audit Committee is paid an annual retainer of $2,000. Each
director of the Company is reimbursed for out-of-pocket expenses incurred in
attending Board and Board committee meetings. The non-executive Chairman of the
Board receives an annual fee of $100,000 in lieu of the annual retainer and any
meeting fees.
4
<PAGE>
Pursuant to an employment agreement executed while Mr. LeCoque was an
employee of the Company, Mr. LeCoque is a consultant to AptarGroup until
December 31, 2015 in return for monthly payments of $12,500 through December 31,
2005 and $8,333 from January 1, 2006 through December 31, 2015. The agreement
provides for payment to Mr. LeCoque's estate in lieu of any further payments he
would have received in the event of his death while acting as a consultant
(monthly installments over the remainder of the consulting period at half the
rate then being paid to him) or a present value equivalent thereof at the time
of death. In addition, during the period commencing January 1, 1996 and ending
on June 9, 2000 in which Mr. LeCoque serves on the Board of Directors, Mr.
LeCoque is entitled to receive an annual office allowance of $15,000 per year.
Mr. LeCoque was paid a total of $165,000 in 1996 under this agreement. The
Company also paid $5,250 for financial planning professional services for the
benefit of Mr. LeCoque in 1996.
Pursuant to the 1992 Director Stock Option Plan, on June 22, 1993 each
non-employee director (six persons) was granted a nonqualified option to
purchase 4,000 shares of Common Stock at a purchase price of $18.375 per share.
These options became exercisable as to 1,000 shares on December 22, 1993 and, on
each anniversary of the date of the grant, became exercisable as to an
additional 1,000 shares so long as the option holder was a non-employee director
on such date. These options became fully exercisable on June 22, 1996. Under the
1992 Director Option Plan, a non-employee director was only eligible for one
grant under the Plan.
In addition, pursuant to the 1996 Director Stock Option Plan, each
non-employee director (seven persons) will be granted on the third trading date
following the date of the 1997 annual meeting a nonqualified option to purchase
4,000 shares of Common Stock at a purchase price equal to the fair market value
of the Common Stock on the date of grant. Each option will become exercisable as
to 1,000 shares on the date which is six months after the date of grant and an
additional 1,000 shares will become exercisable on each anniversary of the date
of grant. Under the 1996 Director Stock Option Plan, a non-employee director is
only eligible for one grant under the Plan.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth information with respect to the beneficial
ownership of Common Stock, as of March 21, 1997, by (a) the persons known by the
Company to be the beneficial owners of more than 5% of the outstanding shares of
Common Stock, (b) each director of the Company, (c) each of the executive
officers of the Company named in the Summary Compensation Table below, (d) all
directors and executive officers of the Company as a group, and (e) the current
members of the Harris Group, as hereinafter defined. Except where otherwise
indicated, the mailing address of each of the stockholders named in the table
is: c/o AptarGroup, Inc., 475 West Terra Cotta Avenue, Suite E, Crystal Lake,
Illinois 60014.
<TABLE>
<CAPTION>
NAME NUMBER OF SHARES(1) PERCENTAGE(2)
- -------------------------------------------------------------------------- ------------------- -----------------
<S> <C> <C>
State Farm Mutual Automobile Insurance Co., et al.(3) .................... 996,566 5.5%
One State Farm Plaza
Bloomington, Illinois 61710
William Harris Investors, Inc.(4)(5) ..................................... 994,633 5.5
2 North LaSalle Street
Suite 505
Chicago, Illinois 60602
Current Harris Group(5)................................................... 2,498,370 13.9
Irving B. Harris(5)(6).................................................... 994,633 5.5
Eugene L. Barnett(7)(8)................................................... 5,052 *
Ralph Gruska(9)........................................................... 4,000 *
Leo A. Guthart(10)........................................................ 59,537 *
Stephen J. Hagge(11)...................................................... 30,071 *
King Harris(5)(8)(12)..................................................... 980,004 5.5
</TABLE>
-5-
<PAGE>
<TABLE>
<CAPTION>
NAME NUMBER OF SHARES(1) PERCENTAGE(2)
- -------------------------------------------------------------------------- ------------------- -----------------
<S> <C> <C>
William W. Harris(5)(8)(13)............................................... 196,080 1.1
Ervin J. LeCoque(14)...................................................... 113,888 *
Peter Pfeiffer(15)........................................................ 389,802 2.2
Alfred Pilz(16)........................................................... 234,000 1.3
Eric S. Ruskoski(17)...................................................... 35,979 *
Hans-Josef Schutz(18)..................................................... 26,969 *
Carl Siebel(19)........................................................... 91,886 *
All Directors and Executive Officers ..................................... 2,294,374 12.5
as a Group (19 persons)(20)
</TABLE>
- ------------------------------
* Less than one percent.
(1) Except as otherwise indicated below, beneficial ownership means the sole
power to vote and dispose of shares.
(2) Based on 17,957,039 shares of Common Stock outstanding as of March 21,
1997.
(3) The information as to State Farm Mutual Automobile Insurance Company and
related entities ("State Farm") is derived from a statement on Schedule 13G
with respect to the Common Stock, filed with the Securities and Exchange
Commission (the "Commission") pursuant to Section 13(d) of the Securities
Exchange Act of 1934 (the "Exchange Act"). Such statement discloses that
State Farm has the sole power to vote and dispose of all shares.
(4) The information as to William Harris Investors, Inc. ("WHI") is derived in
part from a statement on Schedule 13G with respect to the Common Stock,
filed with the Commission pursuant to Section 13(d) of the Exchange Act.
Such statement, together with advice furnished to the Company separately by
WHI, discloses that (i) WHI, an investment adviser registered under the
Investment Advisers Act of 1940, holds all such shares on behalf, and in
discretionary accounts, of Irving B. Harris, William W. Harris and other
members of the Harris Group, (ii) WHI shares voting power and has sole
dispositive power with respect to all such shares and (iii) Irving B.
Harris is the Chairman of WHI.
(5) The information as to the Current Harris Group (as defined below), Irving
B. Harris, King Harris and William W. Harris is derived in part from a
statement with respect to the Common Stock, as amended January 6, 1997,
filed with the Commission pursuant to Section 13(d) of the Exchange Act.
Such statement was filed on behalf of such named persons as well as those
other persons and entities who are currently members of the "Harris Group"
beneficially owning, directly or indirectly, shares of the Common Stock
(the "Current Harris Group"). Such statement discloses that, because of the
relationships among members of the Current Harris Group, such persons may
be deemed to be a group within the meaning of Section 13(d) of the Exchange
Act and the rules and regulations thereunder. The "Harris Group" means
Messrs. Irving B. Harris, Neison Harris, King Harris, William W. Harris and
Sidney Barrows, and their respective spouses, descendants and spouses of
descendants, trustees of trusts established for the benefit of such
persons, and executors of estates of such persons. Irving B. Harris and
Nelson Harris are brothers and Sidney Barrows is their brother-in-law.
William W. Harris is the son of Irving B. Harris and King Harris is the son
of Nelson Harris. The aggregate number of outstanding shares which may be
deemed to be beneficially owned by the Current Harris Group includes all
the shares also shown in this table for Irving B. Harris, King Harris and
William W. Harris and includes the shares in this table for WHI. The total
excludes duplication of shares within such group.
(6) Includes all shares reported above as beneficially owned by WHI. See note
4.
(7) Mr. Barnett shares the power to vote and dispose of 1,052 shares.
(8) Includes 4,000 shares subject to options that are presently exercisable.
(9) Mr. Gruska shares the power to vote and dispose of 1,000 shares. Includes
3,000 shares subject to options that are presently exercisable.
(10) Mr. Guthart shares the power to vote and dispose of 18,939 shares. Includes
1,000 shares subject to options that are presently exercisable.
(11) Mr. Hagge shares the power to vote and dispose of 1,797 shares. Includes
24,042 shares subject to options that are presently exercisable.
(12) Mr. King Harris shares the power to vote and dispose of 931,488 shares.
(13) Mr. William W. Harris shares the power to vote 58,280 shares managed by
WHI, which has the power to dispose of such shares.
(14) Includes 7,100 shares owned by Mr. LeCoque's wife and 73,938 shares subject
to options that are presently exercisable.
(15) Includes 49,243 shares subject to options that are presently exercisable.
-6-
<PAGE>
(16) Mr. Pilz has the power to vote 230,000 shares owned by his wife, who has
the sole power to dispose of such shares.
(17) Includes 23,165 shares subject to options that are presently exercisable.
(18) Includes 1,280 shares owned by Mr. Schutz's wife and 23,569 shares subject
to options that are presently exercisable.
(19) Mr. Siebel shares the power to vote and dispose of 25,857 shares. Includes
66,029 shares subject to options that are presently exercisable.
(20) Includes 392,613 shares subject to options granted that are presently
exercisable and 1,268,413 shares as to which voting power is shared other
than with directors and executive officers of the Company.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth compensation information for the Chairman of
the Board and Chief Executive Officer and the Company's four other most highly
compensated executive officers serving at the end of 1996 (the "named executive
officers").
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
AWARDS
-------------------
ANNUAL COMPENSATION SECURITIES
--------------------------- UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OPTIONS/SARS(#) COMPENSATION
- -------------------------------------------- --------- ----------- -------------- ------------------- --------------
<S> <C> <C> <C> <C> <C>
Carl A. Siebel(1)........................... 1996 $ 443,442 $ 232,750 18,000 $ 6,004(4)
President and Chief 1995 432,184 244,652 18,000 8,099
Executive Officer 1994 357,761 185,522 14,819 7,749
Peter Pfeiffer(1)........................... 1996 326,012 212,800 15,000 --
Vice Chairman of the 1995 331,558 244,652 13,000 --
Board 1994 267,158 92,671 10,977 --
Stephen J. Hagge(2)......................... 1996 228,750 150,000 7,000 4,788(5)
Executive Vice President and 1995 212,916 150,000 7,000 4,787
Chief Financial Officer, 1994 188,710 127,100 6,105 4,388
Secretary and Treasurer
Hans-Josef Schutz(1)........................ 1996 276,329 125,051(3) 6,000 2,321(6)
Geschaftsfuhrer of 1995 285,203 98,420 6,000 2,440
Pfeiffer Group 1994 252,635 27,717 5,269 --
Eric S. Ruskoski(2)......................... 1996 209,167 79,800 7,000 4,788(5)
President of Seaquist Closures 1995 198,333 90,000 7,000 4,786
Division 1994 175,500 101,879 5,791 4,383
</TABLE>
- ------------------------------
(1) Messrs. Siebel's, Pfeiffer's and Schutz's compensation is denominated in
Deutsche Marks. Amounts shown in United States dollars were translated using
the average exchange rate for the respective year.
(2) As of December 31, 1996, Messrs. Hagge and Ruskoski held 534 and 287 shares,
respectively, of restricted stock with a value of $18,824 and $10,117,
respectively, based upon the closing price on the New York Stock Exchange on
December 31, 1996.
(3) Includes $18,651 for 531 shares of restricted stock granted on February 19,
1997 with respect to 1996 performance, calculated based upon the closing
price on the grant date. Such shares vest ratably in equal one-third annual
increments, beginning February 19, 1998. Dividends are not paid on unvested
restricted stock.
(4) Amount attributable to the below market interest rate on a loan to Mr.
Siebel from the Company.
(5) Consists of $4,500 of Company matching contributions to the AptarGroup, Inc.
Profit Sharing and Savings Plan and $288 for Company-provided term life
insurance.
(6) Company-provided term life insurance.
-7-
<PAGE>
Option/SAR Grants
The following table shows all grants in 1996 of stock options to the named
executive officers. The exercise price of all such options was the fair market
value on the date of grant. No SARs were granted in 1996.
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS(1)(2)
-----------------------------------------------------------------------------------
POTENTIAL REALIZABLE
VALUE AT ASSUMED ANNUAL
NUMBER OF % OF TOTAL RATES OF STOCK PRICE
SECURITIES OPTIONS/SARS APPRECIATION FOR OPTION
UNDERLYING GRANTED TO PER SHARE TERM
OPTIONS/SARS EMPLOYEES IN EXERCISE OR EXPIRATION --------------------------
NAME GRANTED (#) 1996 BASE PRICE DATE 5% 10%
- ------------------------------------ ------------- --------------- ----------- ---------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Carl A. Siebel...................... 18,000 11.0 $ 36.00 1/23/06 $ 407,520 $ 1,032,750
Peter Pfeiffer...................... 15,000 9.2 36.00 1/23/06 339,600 860,625
Stephen J. Hagge.................... 7,000 4.3 36.00 1/23/06 158,480 401,625
Hans-Josef Schutz................... 6,000 3.7 36.00 1/23/06 135,840 344,250
Eric S. Ruskoski.................... 7,000 4.3 36.00 1/23/06 158,480 401,625
</TABLE>
- ------------------------------
(1) All options become exercisable in equal one-third annual increments
beginning one year from the grant date.
(2) All options listed in the table were granted on January 23, 1996 at a
purchase price per share equal to $36.00 and expire ten years after their
date of grant. Based on 17,924,886 shares of Common Stock outstanding on
January 23, 1996, the closing price per share of Common Stock of $36.00 on
January 23, 1996 and a ten-year period, the potential realizable value to
all stockholders at 5% and 10% assumed annual rates of stock appreciation
would be $405,819,419 and $1,028,440,334.
Aggregated Option/SAR Exercises and Option/SAR Values at Year End
The following table provides information as to the value of options held by
the named executive officers at year end measured in terms of the closing price
of the Company's Common Stock on December 31, 1996. No options were exercised in
1996 by the named executive officers. The Company has not granted any SARs.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS/SARS AT IN-THE-MONEY OPTIONS/SARS
DECEMBER 31, 1996 (#) AT DECEMBER 31, 1996
-------------------------- --------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- --------------------------------------------------------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Carl A. Siebel................................................. 49,089 34,940 $ 755,899 $ 174,248
Peter Pfeiffer................................................. 36,251 27,326 558,982 127,182
Stephen J. Hagge............................................... 17,341 13,702 263,934 69,431
Hans-Josef Schutz.............................................. 17,812 11,757 275,926 59,696
Eric S. Ruskoski............................................... 16,568 13,598 251,362 67,909
</TABLE>
Employment Agreements
Mr. Siebel's employment agreement provides for employment through June 30,
2000 at a minimum salary (equivalent to approximately $126,000 during 1996) and
provides for a payment of three months' salary to his survivors in the event of
his death while employed. A separate pension agreement provides Mr. Siebel with
an annual pension compensation, subject to cost of living adjustments, of up to
60% of his final year's salary for life, and in the event of his death, provides
his surviving widow with annual payments of 60% of his then pension for life and
may provide any surviving child with annual payments of up to 30% of his then
pension to as late as age 27. Pension benefits would normally commence at age
65, but reduced benefits are available after age 50. Estimated annual pension
benefits upon retirement at age 65 (assuming the current salary remains
constant) are equivalent to approximately $259,000. Benefits are not subject to
reduction for Social Security benefits or other offset items.
-8-
<PAGE>
Mr. Pfeiffer's employment agreement provides for employment through April
21, 1998 at a minimum salary (equivalent to approximately $200,000 during 1996)
and provides for a payment of three months' salary to his survivors in the event
of his death while employed. A separate pension agreement provides Mr. Pfeiffer
with an annual pension compensation, subject to cost of living adjustments, of
up to 60% of his final year's salary for life subject to minimum annual payments
of approximately $178,000, and in the event of his death, provides his surviving
widow with annual payments of 60% of his then pension for life and may provide
any surviving child with annual payments of up to 30% of his then pension to as
late as age 27. Pension benefits would normally commence at age 60, but reduced
benefits are available after age 55 subject to the minimum annual payment.
Estimated annual pension benefits upon retirement at age 60 (assuming the
current salary remains constant) are equivalent to approximately $192,000.
Benefits are not subject to reduction for Social Security or other offset items.
Mr. Hagge's employment agreement provides for employment through February 1,
1999 at a minimum annual salary of $230,000 and provides, in the event of
disability, payment for a period of two years from termination due to disability
of one-half of the amount Mr. Hagge would have received and, in the event of
death, payment to his estate for a period of two years from the anniversary of
his death of one-half of the amount he would have received. Mr. Hagge is also
entitled to additional term life insurance coverage and supplemental long-term
disability coverage. The agreement provides for an automatic extension as of
each February 1, commencing February 1, 1997, for one additional year unless
either the Company or Mr. Hagge terminates the automatic extension provision by
written notice at least 30 days prior to the automatic extension date; provided,
however, that in no event shall the term extend beyond October 28, 2016.
Mr. Schutz's employment agreement provides for employment through May 1,
1999 at a minimum salary (equivalent to approximately $213,000 during 1996). A
separate pension agreement provides Mr. Schutz with an annual pension
compensation, subject to cost of living adjustments, of up to 50% of his final
year's salary for life and in the event of his death, provides his surviving
widow with annual payments of 50% of his then pension for life and may provide
any surviving child with annual payments of up to 20% of his then pension to as
late as age 27. Pension benefits would normally commence at age 65, but reduced
benefits are available after age 55. Estimated annual pension benefits upon
retirement at age 65 (assuming the current salary remains constant) are
equivalent to approximately $106,500. Benefits are not subject to reduction for
Social Security or other offset items.
Mr. Ruskoski's employment agreement provides for employment through February
1, 1999 at a minimum annual salary of 210,000 and provides, in the event of
disability, payment for a period of two years from termination due to disability
of one-half of the amount Mr. Ruskoski would have received and, in the event of
death, payment to his estate for a period of two years from the anniversary of
his death of one-half of the amount he would have received. Mr. Ruskoski is also
entitled to additional term life insurance coverage and supplemental long-term
disability coverage. The agreement provides for an automatic extension as of
each February 1, commencing February 1, 1997, for one additional year unless
either the Company or Mr. Ruskoski terminates the automatic extension provision
by written notice at least 30 days prior to the automatic extension date;
provided, however, that in no event shall the term extend beyond September 12,
2012.
Pension Plan
Substantially all U.S. employees of AptarGroup and its subsidiaries are
eligible to participate in the Pension Plan. Employees are eligible to
participate after six months of credited service and become fully vested after
five years of credited service. The annual benefit payable to an employee under
the Pension Plan upon retirement computed as a straight life annuity equals the
sum of the separate amounts the employee accrues for each of his years of
credited service under the Plan. Such separate amounts are determined as
follows: for each year of credited service through 1988, 1.2% of such year's
compensation up to the Social Security wage base for such year and 1.8% (2% for
years after 1986) of such year's compensation above such wage base, plus certain
increases put into effect prior to 1987; for each year after 1988 through the
year in which the employee reaches 35 years of service, 1.2% of such year's
"Covered Compensation" and 1.85% of such year's compensation above such "Covered
Compensation"; and for each year thereafter, 1.2% of such year's compensation.
The employee's compensation under the Pension Plan for any year includes all
salary, commissions and overtime pay and, beginning in 1989, bonuses, subject to
such year's limit applicable to tax-qualified retirement plans. The employee's
"Covered Compensation" under the Pension Plan for any year is
-9-
<PAGE>
generally the average of the Social Security wage base for each of the 35 years
preceding the employee's Social Security retirement age, assuming that such
year's Social Security wage base will not change in the future. Normal
retirement under the Pension Plan is age 65 and reduced benefits are available
as early as age 55. Benefits are not subject to reduction for Social Security
benefits or other offset items.
Officers of the Company participating in the Pension Plan are also eligible
for the Company's non-qualified supplemental retirement plan ("SERP"). The
benefits payable under the SERP will generally be in the form of a single sum
and will be computed as a single life annuity equal to the sum of the separate
amounts the participant accrues for each year of credited service. Such separate
amounts are determined as follows: for each year of credited service through the
year in which the participant reaches 35 years of service, 1.85% of the
participant's "Supplemental Earnings"; and for each year after 35 years of
credited service, 1.2% of such year's "Supplemental Earnings". "Supplemental
Earnings" is generally the difference between i) the participant's earnings
calculated as if the limitation of Section 401(a)(17) of the Internal Revenue
Code (the "Code") were not in effect and ii) the participant's recognized
earnings under the Pension Plan. Participants who terminate service prior to
being eligible for retirement (i.e., age 65 or age 55 with 10 years of credited
service) will forfeit all accrued benefits under the SERP. The SERP provides for
the vesting of all accrued benefits in the event of a change of control.
Estimated annual benefits payable under the Pension Plan and the SERP upon
retirement at normal retirement age for Messrs. Hagge and Ruskoski are
approximately $170,000 and $124,000, respectively. Messrs. Siebel, Pfeiffer and
Schutz are not eligible to receive benefits under the Pension Plan but, as
described above, are entitled to certain pension benefits pursuant to their
respective employment agreements.
Compensation Committee Report on Executive Compensation
COMPENSATION POLICY
The compensation policy is designed to support the Company's overall
objective of increasing stockholder value by:
- Attracting, motivating, and retaining key executives who are critical to
the long-term success of the Company.
- Awarding short-term incentives based upon respective unit performance and
overall Company performance.
- Aligning executive and stockholder interests through a stock-based
long-term incentive program which will reward executives for increased
stockholder value.
The Compensation Committee's general policy is to qualify long-term
incentive compensation of executive officers for deductibility under Section
162(m) of the Internal Revenue Code. The total compensation program consists of
three components:
Base Salary
The salary ranges of executive officers are established in relation to
competitive market data provided by outside executive compensation consultants
and review of proxy statements of similar publicly-held companies in the
packaging industry. Comparisons are made to positions with similar job
responsibilities, positions in companies of comparable sales volume, and
positions in similar companies in the same industry as AptarGroup. Four of the
companies used in establishing salary ranges are included in the Value Line
Packaging and Container Industry Group used in the performance graph below.
Generally, salaries are established at approximately the 50th to 75th percentile
of an executive's salary range. Salary ranges and salaries are reviewed
annually. Generally, management performance and accomplishment of goals and
objectives are weighted most important in determining base salary increases.
Short-Term Incentives
Executives are eligible for annual cash bonuses based upon:
- Profit growth
- Return on equity
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<PAGE>
- Achievement of other goals and objectives
- General management performance
Generally, profit growth and return on equity are weighted most important in
determining annual cash bonuses. For 1996, no set bonus formula was used. At the
Committee's discretion, a portion of the annual cash bonus may be paid in the
form of shares of restricted stock.
Long-term Incentives
Executives are eligible for awards of stock options and other awards under
the Company's 1992 Stock Awards Plan and 1996 Stock Awards Plan. The awards to
executives are made to provide an incentive for future performance to increase
stockholder value. The members of the Compensation Committee administer this
Plan. Generally, the total amount to be awarded annually will equal
approximately 1% of AptarGroup's total stock outstanding. In 1996, the total
amount of options granted was approximately 1% of the total stock outstanding.
As reflected in the table of option grants, stock options were granted on
January 23, 1996 to all of the named executive officers. Awards were determined
in relation to the individual's position and responsibility. The exercise price
of the options equaled the market price of the Company's Common Stock on the
date of the grants.
CHIEF EXECUTIVE OFFICER COMPENSATION
Mr. Siebel's salary is denominated in Deutsche Marks ("DM") and was
increased 9.2% to 650,000 DM (equivalent to approximately $432,200), on January
1, 1996, as compensation for Mr. Siebel's performance and his assuming
additional responsibilities as Chief Executive Officer. The Committee set the
CEO's compensation at approximately the 50th percentile of the comparable salary
range. His 1996 bonus of 350,000 DM (equivalent to approximately $232,750) was
established based upon the increase in the Company's profitability for 1996 as
compared to 1995. During 1996, Mr. Siebel was awarded an option to purchase
18,000 shares of Common Stock.
COMPENSATION COMMITTEE
Leo Guthart, Chairman
Ralph Gruska
King Harris
William Harris
-11-
<PAGE>
Performance Graph
The following graph compares the percentage change in cumulative total
stockholder return for the Company's Common Stock from April 23, 1993 (the first
day of trading after Pittway Corporation distributed to its stockholders the
shares of Common Stock of the Company) to December 31, 1996 with the cumulative
total return on the Standard & Poor's 500 Composite Stock Price Index and the
Value Line Packaging & Container Industry Group ("Peer Group"). One company,
Kerr Group, Inc., was deleted from the Peer Group and replaced with the Company
in conjunction with Value Line's changes to the relevant industry group in 1996.
These comparisons assume an initial investment of $100 and the reinvestment of
dividends.
[EDGAR REPRESENTATION OF PRINTED GRAPHIC]
<TABLE>
<CAPTION>
4/23/93 12/31/93 12/31/94 12/31/95 12/31/96
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
AptarGroup.............................. 100 110 154 201 191
Peer Group.............................. 100 110 106 120 150
S&P 500................................. 100 109 110 152 187
</TABLE>
-12-
<PAGE>
CERTAIN TRANSACTIONS
Carl A. Siebel, a director of AptarGroup and its President and Chief
Executive Officer, is indebted to a subsidiary of AptarGroup. The largest amount
outstanding in local currency under this loan since January 1, 1996 was $97,000
(using the exchange rate at the date such amount was outstanding). As of
December 31, 1996, the amount of the loan was equivalent to $73,000 based on the
exchange rate at such date. The loan, which was used to relocate Mr. Siebel's
residence, is payable in Deutsche Marks through the year 2000 in quarterly
installments of principal and interest at the rate of 7 percentage points below
the long-term borrowing rate in Germany for the preceding year. Mr. Siebel's
interest rate for 1996 was .05%.
Pierre Cheru, Directeur General of Valois S.A. and Jacques Blanie, Executive
Vice President of SeaquistPerfect Dispensing Division are indebted to
subsidiaries of AptarGroup. These loans were made primarily to assist them in
relocation of their personal residences. Each of the loans is secured by a
second mortgage on the personal residence of the individual. Messrs. Cheru's and
Blanie's loans are repayable primarily on a quarterly basis with the final
payments to be made in 1999 and 2009, respectively. The largest amounts
outstanding in local currencies under these loans since January 1, 1996 were
$102,000 for Mr. Cheru and $177,000 for Mr. Blanie (using the exchange rates at
the dates such amounts were outstanding). The amounts outstanding at December
31, 1996 were $80,000 for Mr. Cheru and $157,000 for Mr. Blanie (using the
exchange rate at such date). Messrs. Cheru's and Blanie's loans bear interest at
6% per annum.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based solely on a review of copies of reports of ownership, reports of
changes of ownership and written representations under Section 16(a) of the
Exchange Act which were furnished to the Company during 1996 and with respect to
1996 by persons who were, at any time during 1996, directors or executive
officers of the Company or otherwise required to file such reports under Section
16(a), no such persons failed to file on a timely basis reports required by such
Section 16 during or with respect to 1996.
ANNUAL REPORT
The Company's annual report for the year ended December 31, 1996 is being
distributed with this proxy statement. Stockholders are referred to the report
for financial and other information about the Company, but such report is not
incorporated in this proxy statement and is not deemed a part of the proxy
soliciting material.
STOCKHOLDER PROPOSALS
In order to be considered for inclusion in the Company's proxy materials for
the 1998 annual meeting of stockholders, any stockholder proposal must be
received at the Company's principal executive offices at 475 West Terra Cotta
Avenue, Suite E, Crystal Lake, Illinois 60014 by December 10, 1997. In addition,
the Company's Bylaws establish an advance notice procedure for stockholder
proposals to be brought before any meeting of stockholders, including proposed
nominations of persons for election to the Board. Stockholders at the 1997
annual meeting may consider stockholder proposals or nominations brought by a
stockholder of record on March 21, 1997, who is entitled to vote at the annual
meeting and who has given the Company's Secretary timely written notice, in
proper form, of the stockholder's proposal or nomination. A stockholder proposal
or nomination intended to be brought before the 1997 annual meeting must have
been received by the Secretary on or after February 14, 1997 and on or prior to
March 16, 1997. The 1998 annual meeting is expected to be held on May 13, 1998.
A stockholder proposal or nomination intended to be brought before the 1998
annual meeting must be received by the Secretary on or after February 13, 1998
and on or prior to March 15, 1998.
OTHER MATTERS
Price Waterhouse LLP, who served as independent accountants for the year
ended December 31, 1996, have been selected by the Board, upon the
recommendation of the Audit Committee, to audit the consolidated financial
statements of the Company for the year ending December 31, 1997. It is expected
that a representative of Price Waterhouse LLP will attend the annual meeting,
with the opportunity to make a statement if he should so desire, and will be
available to respond to appropriate questions.
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<PAGE>
The cost of this solicitation of proxies will be borne by the Company. In
addition to the use of the mails, some of the officers and regular employees of
the Company may solicit proxies by telephone and telegraph and request brokerage
houses, banks and other custodians, nominees and fiduciaries to forward
soliciting material to the beneficial owners of Common Stock held of record by
such persons. The Company will reimburse such persons for expenses incurred in
forwarding such soliciting material. It is contemplated that additional
solicitation of proxies will be made in the same manner under the engagement and
direction of ChaseMellon Shareholder Services at an anticipated cost to the
Company of $3,500 plus expenses.
By Order of the Board of Directors
/s/ Stephen J. Hagge
Stephen J. Hagge
Secretary
Crystal Lake, Illinois
April 9, 1997
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<PAGE>
COMMON
STOCK
PROXY
AptarGroup, Inc.
475 West Terra Cotta Ave., Suite E
Crystal Lake, IL 60014
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
Carl A. Siebel and Stephen J. Hagge, or either of them (each with full power of
substitution), are hereby authorized to vote all the shares of Common Stock
which the undersigned would be entitled to vote if personally present at the
annual meeting of stockholders of AptarGroup, Inc. to be held on May 14, 1997,
and at any adjournment thereof as specified on reverse side.
(continued on reverse side)
<PAGE>
1. ELECTION OF DIRECTORS
FOR all nominees WITHHOLD Eugene L. Barnett, Ralph Gruska, Leo A. Guthart
listed at right AUTHORITY
(except as marked to vote for (INSTRUCTION: To withhold authority to vote
to the contrary) all nominees for any individual nominee, write that
listed at nominee's name in the space provided below.)
right
-- -- ----------------------------------------------
2. IN THEIR DISCRETION UPON SUCH OTHER BUSINESS AS MAY PROPERLY BE BROUGHT
BEFORE THE MEETING
The shares represented by this proxy will be
voted as herein directed, but if no direction
is given, the shares will be voted FOR the
election of directors. This proxy revokes any
proxy heretofore given.
Dated , 1997
-----------------------
---------------------------------------------
---------------------------------------------
(Signature of Stockholder)
(Please fill in, sign and date this proxy and
mail it in the envelope provided)
IMPORTANT: Please sign exactly as your
name(s) appear to the left. Joint owners
should each sign personally. If you sign as
agent or any other capacity, please state the
capacity in which you sign.
