APTARGROUP INC (Form: 10-Q, Received: 11/04/2008 15:01:54)

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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549-1004

FORM 10-Q


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

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2008


[ ]		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.)

475 WEST TERRA COTTA AVENUE, SUITE E, CRYSTAL LAKE, ILLINOIS 60014

815-477-0424

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 o

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


Large accelerated filer þ		Accelerated filer o		Non-accelerated filer o (Do not check if a smaller reporting company)		Smaller reporting company o

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date (October 21, 2008).

Common Stock 67,511,022

AptarGroup, Inc.

Form 10-Q

Quarter Ended September 30, 2008

INDEX


Part I.	FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited)

	Condensed Consolidated Statements of Income — Three and Nine Months Ended September 30, 2008 and 2007	1

	Condensed Consolidated Balance Sheets -September 30, 2008 and December 31, 2007	2

	Condensed Consolidated Statements of Cash Flows — Nine Months Ended September 30, 2008 and 2007	4

	Notes to Condensed Consolidated Financial Statements	5

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	12

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	19

Item 4.	Controls and Procedures	19

Part II.	OTHER INFORMATION

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	20

Item 6.	Exhibits	20

	Signature	21
EX-10.1
EX-10.2
EX-31.1
EX-31.2
EX-32.1
EX-32.2

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 September 30,						Nine Months Ended September 30,
	2008			2007			2008			2007

Net Sales	$	532,180		$	485,692		$	1,615,757		$	1,408,409

Operating Expenses :
Cost of sales (exclusive of depreciation shown below)		366,637			330,438			1,102,325			949,293
Selling, research & development and administrative		73,843			65,773			234,486			205,303
Depreciation and amortization		32,537			32,065			99,864			92,246

		473,017			428,276			1,436,675			1,246,842

Operating Income		59,163			57,416			179,082			161,567


Other Income (Expense) :
Interest expense		(5,261	)		(4,880	)		(14,204	)		(14,335	)
Interest income		3,475			2,222			10,334			5,600
Equity in results of affiliates		194			158			417			426
Minority interests		(43	)		(22	)		(24	)		(4	)
Miscellaneous, net		(635	)		(303	)		(1,320	)		(1,513	)

		(2,270	)		(2,825	)		(4,797	)		(9,826	)


Income Before Income Taxes		56,893			54,591			174,285			151,741

Provision for Income Taxes		17,242			15,196			52,460			45,798


Net Income	$	39,651		$	39,395		$	121,825		$	105,943


Net Income Per Common Share:
Basic	$	0.59		$	0.58		$	1.79		$	1.54

Diluted	$	0.57		$	0.56		$	1.72		$	1.48


Average Number of Shares Outstanding:
Basic		67,670			68,488			67,958			68,902
Diluted		69,937			70,909			70,812			71,717

Dividends Declared Per Common Share	$	0.15		$	0.13		$	0.41		$	0.37

See accompanying unaudited notes to condensed consolidated financial statements.

AptarGroup, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

In thousands, except per share amounts


	September 30,			December 31,
	2008			2007
Assets

Current Assets:
Cash and equivalents	$	301,180		$	313,739
Accounts and notes receivable, less allowance for doubtful accounts of $11,385 in 2008 and $11,139 in 2007		383,234			360,736
Inventories, net		260,845			272,556
Prepaid expenses and other current assets		65,026			56,414

		1,010,285			1,003,445


Property, Plant and Equipment:
Buildings and improvements		283,874			264,535
Machinery and equipment		1,473,872			1,408,761

		1,757,746			1,673,296
Less: Accumulated depreciation		(1,071,760	)		(1,033,544	)

		685,986			639,752
Land		17,204			16,756

		703,190			656,508


Other Assets:
Investments in affiliates		4,954			4,085
Goodwill		225,618			222,668
Intangible assets, net		14,921			17,814
Other non-current assets		7,224			7,430

		252,717			251,997

Total Assets	$	1,966,192		$	1,911,950

See accompanying unaudited notes to condensed consolidated financial statements.

AptarGroup, Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

In thousands, except per share amounts


	September 30,			December 31,
	2008			2007
Liabilities and Stockholders’ Equity

Current Liabilities:
Notes payable	$	151,173		$	190,176
Current maturities of long-term obligations		24,680			25,983
Accounts payable and accrued liabilities		347,077			349,030

		522,930			565,189


Long-Term Obligations		224,221			146,711


Deferred Liabilities and Other:
Deferred income taxes		25,534			28,613
Retirement and deferred compensation plans		43,466			42,787
Deferred and other non-current liabilities		8,951			9,079
Commitments and contingencies		—			—
Minority interests		787			553

		78,738			81,032


Stockholders’ Equity:
Preferred stock, $.01 par value, 1 million shares authorized, none outstanding		—			—
Common stock, $.01 par value		800			794
Capital in excess of par value		253,209			229,022
Retained earnings		1,044,521			950,566
Accumulated other comprehensive income		172,206			214,294
Less treasury stock at cost, 12.5 and 11.2 million shares as of September 30, 2008 and December 31, 2007		(330,433	)		(275,658	)

		1,140,303			1,119,018

Total Liabilities and Stockholders’ Equity	$	1,966,192		$	1,911,950

See accompanying unaudited notes to condensed consolidated financial statements.

AptarGroup, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

In thousands, brackets denote cash outflows


Nine Months Ended September 30,	2008			2007

Cash Flows From Operating Activities:
Net income	$	121,825		$	105,943
Adjustments to reconcile net income to net cash provided by operations:
Depreciation		96,072			88,908
Amortization		3,792			3,338
Stock option based compensation		9,916			12,389
Provision for bad debts		1,827			677
Labor redeployment		—			(452	)
Minority interests		24			4
Deferred income taxes		(4,437	)		(10,151	)
Retirement and deferred compensation plans		815			3,841
Equity in results of affiliates in excess of cash distributions received		(220	)		(426	)
Changes in balance sheet items, excluding effects from foreign currency adjustments:
Accounts receivable		(37,618	)		(33,207	)
Inventories		5,508			(21,639	)
Prepaid and other current assets		(7,571	)		(4,914	)
Accounts payable and accrued liabilities		8,060			30,586
Income taxes payable		(6,387	)		12,861
Other changes, net		11,555			(939	)

Net Cash Provided by Operations		203,161			186,819


Cash Flows From Investing Activities:
Capital expenditures		(157,287	)		(90,626	)
Disposition of property and equipment		592			2,570
Intangible assets acquired		(755	)		(976	)
Acquisition of businesses, net of cash acquired		(13,166	)		(5,151	)
Investment in affiliates		(807	)		—
(Issuance) collection of notes receivable, net		(960	)		129

Net Cash Used by Investing Activities		(172,383	)		(94,054	)


Cash Flows From Financing Activities:
Proceeds from notes payable		—			79,713
Repayments of notes payable		(38,616	)		—
Proceeds from long-term obligations		100,000			—
Repayments of long-term obligations		(23,579	)		(24,408	)
Dividends paid		(27,870	)		(25,542	)
Proceeds from stock options exercises		12,813			12,476
Purchase of treasury stock		(57,569	)		(56,818	)
Excess tax benefit from exercise of stock options		3,886			2,980

Net Cash Used by Financing Activities		(30,935	)		(11,599	)


Effect of Exchange Rate Changes on Cash		(12,402	)		18,331


Net (Decrease)/increase in Cash and Equivalents		(12,559	)		99,497
Cash and Equivalents at Beginning of Period		313,739			170,576

Cash and Equivalents at End of Period	$	301,180		$	270,073

See accompanying unaudited notes to condensed consolidated financial statements.

AptarGroup, Inc.

Notes to Condensed Consolidated Financial Statements

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

(Unaudited)

NOTE 1 — BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements include the accounts of AptarGroup, Inc. and its subsidiaries. The terms “AptarGroup” or “Company” as used herein refer to AptarGroup, Inc. and its subsidiaries.

In the opinion of management, the unaudited condensed consolidated financial statements include all adjustments, consisting of only normal recurring adjustments, necessary for the fair statement of consolidated financial position, results of operations, and cash flows for the interim periods presented. The accompanying unaudited condensed consolidated financial statements have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosure normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures made are adequate to make the information presented not misleading. Accordingly, these unaudited consolidated financial statements and related notes should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2007. The results of operations of any interim period are not necessarily indicative of the results that may be expected for the year.

NOTE 2 — INVENTORIES

At September 30, 2008 and December 31, 2007, approximately 23% of the total inventories are accounted for by using the LIFO method. Inventories, by component net of reserves, consisted of:


	September 30,			December 31,
	2008			2007

Raw materials	$	101,566		$	101,993
Work in progress		57,878			59,894
Finished goods		109,462			115,774

Total		268,906			277,661
Less LIFO Reserve		(8,061	)		(5,105	)

Total	$	260,845		$	272,556

NOTE 3 — GOODWILL AND OTHER INTANGIBLE ASSETS

The changes in the carrying amount of goodwill since the year ended December 31, 2007 are as follows by reporting segment:


	Pharma			Beauty & Home			Closures			Total

Balance as of December 31, 2007	$	25,413		$	158,537		$	38,718		$	222,668
Acquisitions (See Note 11)		3,714			3,421			—			7,135
Foreign currency exchange effects		(842	)		(2,594	)		(749	)		(4,185	)

Balance as of September 30, 2008	$	28,285		$	159,364		$	37,969		$	225,618

The table below shows a summary of intangible assets as of September 30, 2008 and December 31, 2007.


		September 30, 2008							December 31, 2007
	Weighted Average	Gross							Gross
	Amortization	Carrying		Accumulated			Net		Carrying		Accumulated			Net
	Period (Years)	Amount		Amortization			Value		Amount		Amortization			Value

Amortized intangible assets:
Patents	14	$	18,703	$	(12,946	)	$	5,757	$	19,194	$	(12,230	)	$	6,964
License agreements and other	7		24,133		(14,969	)		9,164		23,557		(12,707	)		10,850

Total intangible assets	10	$	42,836	$	(27,915	)	$	14,921	$	42,751	$	(24,937	)	$	17,814

Aggregate amortization expense for the intangible assets above for the quarters ended September 30, 2008 and 2007 was $1,297 and $1,150, respectively. Aggregate amortization expense for the intangible assets above for the nine months ended September 30, 2008 and September 30, 2007 was $3,792 and $3,338, respectively.

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


2008	$	4,779
2009		4,147
2010		3,678
2011		2,199
2012		1,130

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 September 30, 2008.

NOTE 4 — TOTAL COMPREHENSIVE (LOSS)/INCOME

AptarGroup’s total comprehensive (loss)/income was as follows:


	Three Months Ended September 30,						Nine Months Ended September 30,
	2008			2007			2008			2007

Net income	$	39,651		$	39,395		$	121,825		$	105,943
Add: Foreign currency translation adjustments		(134,675	)		53,547			(41,973	)		78,930
Net gain/(loss) on derivatives (net of tax)		5			35			(602	)		(46	)
Pension liability adjustment (net of tax)		169			(703	)		488			(639	)

Total comprehensive (loss)/income	$	(94,850	)	$	92,274		$	79,738		$	184,188

NOTE 5 — RETIREMENT AND DEFERRED COMPENSATION PLANS

Components of Net Periodic Benefit Cost:

Three months ended September 30,


	Domestic Plans						Foreign Plans
	2008			2007			2008			2007

Service cost	$	1,109		$	977		$	419		$	397
Interest cost		883			738			556			326
Expected return on plan assets		(755	)		(687	)		(212	)		(183	)
Amortization of net loss		48			1			193			(23	)
Amortization of prior service cost		1			19			20			267

Net periodic benefit cost	$	1,286		$	1,048		$	976		$	784

Nine months ended September 30,


	Domestic Plans						Foreign Plans
	2008			2007			2008			2007

Service cost	$	3,045		$	2,901		$	1,275		$	1,165
Interest cost		2,611			2,248			1,689			1,145
Expected return on plan assets		(2,309	)		(2,042	)		(644	)		(535	)
Amortization of net loss		60			3			583			10
Amortization of prior service cost		3			199			61			519

Net periodic benefit cost	$	3,410		$	3,309		$	2,964		$	2,304

EMPLOYER CONTRIBUTIONS

In order to meet or exceed minimum funding levels required by U.S. law, the Company has contributed $3.2 million as of September 30, 2008 to its domestic defined benefit plans. The Company may make additional discretionary contributions to its domestic defined benefit plans prior to the end of 2008. The Company plans to make contributions in 2008 to certain of its European pension plans that have not been funded in the past. Accordingly, the Company expects to contribute approximately $8 million to its foreign defined benefit plans in 2008 and as of September 30, 2008, has contributed approximately $0.4 million.

NOTE 6 — DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

The Company maintains a foreign exchange risk management policy designed to establish a framework to protect the value of the Company’s non-functional denominated transactions from adverse changes in exchange rates. Sales of the Company’s 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 impact the Company’s results of operations. The Company’s policy is not to engage in speculative foreign currency hedging activities, but to minimize its net foreign currency transaction exposure defined as firm commitments and transactions recorded and denominated in currencies other than the functional currency. The Company may use foreign currency forward exchange contracts, options and cross currency swaps to hedge these risks.

The Company maintains an interest rate risk management strategy to minimize significant, unanticipated earnings fluctuations that may arise from volatility in interest rates.

For derivative instruments designated as hedges, the Company formally documents 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. 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.

FAIR VALUE HEDGES

The Company has an interest rate swap to convert a portion of its fixed-rate debt into variable-rate debt. Under the interest rate swap contract, the Company exchanges, at specified intervals, the difference between fixed-rate and floating-rate amounts, which is calculated based on an agreed upon notional amount.

As of September 30, 2008, the Company recorded the fair value of the derivative instrument of $1.0 million in other non-current assets with a corresponding increase to debt related to the fixed-to-variable interest rate swap agreement with a notional principal value of $15 million. No gain or loss related to the change in fair value was recorded in the income statement for the three and nine months ended September 30, 2008 or 2007 as any hedge ineffectiveness for the period was immaterial.

CASH FLOW HEDGES

As of September 30, 2008, the Company had one foreign currency cash flow hedge. A French entity of AptarGroup, AptarGroup Holding SAS, has hedged the risk of variability in Euro equivalent associated with the cash flows of an intercompany loan granted in Brazilian Real. The forward contracts utilized were designated as a hedge of the changes in the cash flows relating to the changes in foreign currency rates relating to the loan and related forecasted interest. The notional amount of the foreign currency forward contracts utilized to hedge cash flow exposure was 5.5 million Brazilian Real ($2.9 million) as of September 30, 2008. The notional amount of the foreign currency forward contracts utilized to hedge cash flow exposure was 6.7 million Brazilian Real ($3.7 million) as of September 30, 2007.

During the nine months ended September 30, 2008, the Company did not recognize any net gain (loss) as any hedge ineffectiveness for the period was immaterial, and the Company did not recognize any net gain (loss) related to the portion of the hedging instrument excluded from the assessment of hedge effectiveness. The Company’s foreign currency forward contracts hedge certain forecasted transactions for three and a half years (March 2012).

HEDGE OF NET INVESTMENTS IN FOREIGN OPERATIONS

A significant number of the Company’s 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 the Company’s foreign entities. A weakening U.S. dollar relative to foreign currencies has an additive translation effect on the Company’s financial condition and results of operations. Conversely, a strengthening U.S. dollar has a dilutive effect. The Company in some cases maintains debt in these subsidiaries to offset the net asset exposure. The Company does not otherwise actively manage this risk using derivative financial instruments. In the event the Company plans on a full or partial liquidation of any of its foreign subsidiaries where the Company’s net investment is likely to be monetized, the Company will consider hedging the currency exposure associated with such a transaction.

OTHER

As of September 30, 2008, the Company recorded the fair value of foreign currency forward exchange contracts of $2.2 million in accounts payable and accrued liabilities and $1.9 million in deferred and other non-current liabilities in the balance sheet. All forward exchange contracts outstanding as of September 30, 2008 had an aggregate contract amount of $109.4 million.

NOTE 7 — 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. Management believes the resolution of these claims and lawsuits will not have a material adverse or positive effect on the Company’s financial position, results of operations or cash flow.

Under its Certificate of Incorporation, the Company has agreed to indemnify its officers and directors for certain events or occurrences while the officer or director is, or was serving, at its request in such capacity. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has a directors’ and officers’ liability insurance policy that covers a portion of its exposure. As a result of its insurance policy coverage, the Company believes the estimated fair value of these indemnification agreements is minimal. The Company has no liabilities recorded for these agreements as of September 30, 2008.

NOTE 8 — STOCK REPURCHASE PROGRAM

On July 17, 2008, the Company’s Board of Directors authorized the Company to repurchase an additional four million shares of its outstanding common stock. There is no expiration date for this repurchase program.

During the quarter ended September 30, 2008, the Company repurchased 535 thousand shares for an aggregate amount of $20.7 million. As of September 30, 2008, the Company has outstanding authorizations to repurchase up to approximately 4.5 million additional shares. The timing of and total amount expended for the share repurchase depend upon market conditions. While we believe our balance sheet remains strong, we have decided to temporarily suspend the repurchase of the Company’s common stock in order to conserve cash in the short term due to the recent worldwide credit crisis. We will continue to evaluate this decision in the future.

NOTE 9 — EARNINGS PER SHARE

AptarGroup’s authorized common stock consists of 199 million shares, having a par value of $.01 each. Information related to the calculation of earnings per share is as follows:


	Three months ended
	September 30, 2008				September 30, 2007
	Diluted		Basic		Diluted		Basic

Consolidated operations
Income available to common stockholders	$	39,651	$	39,651	$	39,395	$	39,395


Average equivalent shares
Shares of common stock		67,670		67,670		68,488		68,488
Effect of dilutive stock based compensation
Stock options		2,261		—		2,415		—
Restricted stock		6		—		6		—

Total average equivalent shares		69,937		67,670		70,909		68,488

Net income per share	$	0.57	$	0.59	$	0.56	$	0.58


	Nine months ended
	September 30, 2008				September 30, 2007
	Diluted		Basic		Diluted		Basic

Consolidated operations
Income available to common stockholders	$	121,825	$	121,825	$	105,943	$	105,943


Average equivalent shares
Shares of common stock		67,958		67,958		68,902		68,902
Effect of dilutive stock based compensation
Stock options		2,845		—		2,804		—
Restricted stock		9		—		11		—

Total average equivalent shares		70,812		67,958		71,717		68,902

Net income per share	$	1.72	$	1.79	$	1.48	$	1.54

NOTE 10 — SEGMENT INFORMATION

The Company operates in the packaging components industry, which includes the development, manufacture and sale of consumer product dispensing systems. Operations that sell spray and lotion dispensing systems primarily to the personal care, fragrance/cosmetic and household markets form the Beauty & Home segment. Operations that sell dispensing systems to the pharmaceutical market form the Pharma segment. Operations that sell closures to each market served by AptarGroup form the Closures segment.

The accounting policies of the segments are the same as those described in Note 1, Summary of Significant Accounting Policies in the Company’s Annual Report on Form 10-K for the year ended December 31, 2007. The Company evaluates performance of its business segments and allocates resources based upon earnings before interest expense in excess of interest income, stock option and corporate expenses, income taxes and unusual items (collectively referred to as “Segment Income”).

Financial information regarding the Company’s reportable segments is shown below:


	Three Months Ended September 30,						Nine Months Ended September 30,
	2008			2007			2008			2007

Total Sales:
Beauty & Home	$	275,501		$	261,135		$	855,269		$	758,561
Closures		142,548			127,065			421,756			369,628
Pharma		118,351			100,817			351,052			290,036
Other		31			336			204			1,038

Total Sales		536,431			489,353			1,628,281			1,419,263

Less: Intersegment Sales:
Beauty & Home	$	3,847		$	2,522		$	10,941		$	7,804
Closures		124			546			811			1,596
Pharma		249			258			573			419
Other		31			335			199			1,035

Total Intersegment Sales	$	4,251		$	3,661		$	12,524		$	10,854

Net Sales:
Beauty & Home	$	271,654		$	258,613		$	844,328		$	750,757
Closures		142,424			126,519			420,945			368,032
Pharma		118,102			100,559			350,479			289,617
Other		—			1			5			3

Net Sales	$	532,180		$	485,692		$	1,615,757		$	1,408,409


Segment Income:
Beauty & Home	$	21,701		$	25,561		$	77,904		$	78,136
Closures		12,616			12,494			36,669			39,838
Pharma		34,408			29,407			99,275			78,445
Corporate Expenses & Other		(10,046	)		(10,213	)		(35,693	)		(35,943	)

Income before interest and taxes	$	58,679		$	57,249		$	178,155		$	160,476
Interest expense, net		(1,786	)		(2,658	)		(3,870	)		(8,735	)

Income before income taxes	$	56,893		$	54,591		$	174,285		$	151,741

NOTE 11 — ACQUISITIONS

At the end of March 2008, the Company acquired 70% of the outstanding shares of Next Breath LLC (“Next Breath”) for approximately $4.1 million in cash. No debt was assumed in the transaction. Next Breath, located in Baltimore, Maryland, is a contract service organization specializing in analytical testing of nasal and inhalation products on behalf of pharmaceutical, biotech, drug delivery and device companies. Next Breath’s annual sales are approximately $2.0 million. The excess purchase price over the fair value of assets acquired and liabilities assumed was allocated to Goodwill. Goodwill of approximately $3.7 million was recorded on the transaction. Next Breath is included in the Pharma reporting segment.

In April 2008, the Company acquired the equipment, inventory and intellectual property of CCL Industries’ Bag-on-Valve business (“CCLBOV”) for approximately $9.3 million in cash. No debt was assumed in the transaction. CCLBOV’s annual revenues are approximately $9.0 million. The excess purchase price over the fair value of assets acquired was allocated to Goodwill. Goodwill of approximately $3.4 million was recorded on the transaction. CCLBOV was located in Canada but the assets purchased were transferred to existing AptarGroup facilities in the U.S. before the end of the second quarter. CCLBOV is included in the Beauty and Home reporting segment.

Neither of these acquisitions had a material impact on the results of operations in 2008 and therefore no proforma information is required.

NOTE 12 — STOCK-BASED COMPENSATION

SFAS 123(R) upon adoption requires the application of the non-substantive vesting approach which means that an award is fully vested when the employee’s retention of the award is no longer contingent on providing subsequent service. Under this approach, compensation costs are recognized over the requisite service period of the award instead of ratably over the vesting period stated in the grant. As such, costs would be recognized immediately, if the employee is retirement eligible on the date of grant or over the period from the date of grant until retirement eligibility if retirement eligibility is reached before the end of the vesting period stated in the grant. For awards granted prior to adoption, the Company will continue to recognize compensation costs ratably over the vesting period with accelerated recognition of the unvested portion upon actual retirement.

The Company issues stock options and restricted stock units to employees under Stock Awards Plans approved by shareholders. Stock options are issued to non-employee directors for their services as directors under Director Stock Option Plans approved by shareholders. Options are awarded with the exercise price equal to the market price on the date of grant and generally become exercisable over three years and expire 10 years after grant. Restricted stock units generally vest over three years.

Compensation expense recorded attributable to stock options for the first nine months of 2008 was approximately $9.9 million ($7.1 million after tax), or $0.10 per share (basic and diluted). Approximately $9.1 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 recorded attributable to stock options for the first nine months of 2007 was approximately $12.4 million ($8.7 million after tax), or $0.13 per share basic and $0.12 per share diluted. Approximately $11.6 million of the compensation expense was recorded in selling, research & development and administrative expenses and the balance was recorded in cost of sales.

The Company uses historical data to estimate expected life and volatility. The weighted-average fair value of stock options granted under the Stock Awards Plans was $10.02 and $9.32 per share in 2008 and 2007, respectively. These values were estimated on the respective dates of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:


Stock Awards Plans:
Nine months ended September 30,	2008			2007

Dividend Yield		1.4	%		1.4	%
Expected Stock Price Volatility		22.4	%		24.6	%
Risk-free Interest Rate		3.7	%		4.8	%
Expected Life of Option (years)		7.0			7.0

The fair value of stock options granted under the Director Stock Option Plan was $12.08. There were no stock options granted under the Director Stock Option Plans in 2007. These values were estimated on the respective date of the grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:


Director Stock Option Plans:
Nine months ended September 30,	2008			2007

Dividend Yield		1.3	%		—
Expected Stock Price Volatility		22.3	%		—
Risk-free Interest Rate		3.8	%		—
Expected Life of Option (years)		7.0			—

A summary of option activity under the Company’s stock option plans as of September 30, 2008, and changes during the period then ended is presented below:

Stock Awards Plans

Director Stock Option Plans

Weighted Average

Shares

Exercise Price

Shares

Exercise Price

Outstanding, January 1, 2008

7,405,338

21.34

153,000

22.70

Granted

1,252,000

37.52

4,000

44.16

Exercised

(761,047

)

15.60

—

Forfeited or expired

(37,429

)

32.58

—

Outstanding at September 30, 2008

7,858,862

24.42

157,000

23.25

Exercisable at September 30, 2008

5,415,491

20.33

153,000

22.70

Weighted-Average Remaining Contractual Term (Years):

Outstanding at September 30, 2008

6.3

5.4

Exercisable at September 30, 2008

5.2

5.3

Aggregate Intrinsic Value ($000):

Outstanding at September 30, 2008

115,203

2,510

Exercisable at September 30, 2008

101,700

2,510

Intrinsic Value of Options Exercised ($000) During the Nine Months Ended:

September 30, 2008

20,242

—

September 30, 2007

15,274

1,024

The fair value of shares vested during the nine months ended September 30, 2008 and 2007 was $10.4 million and $9.5 million, respectively. Cash received from option exercises was approximately $12.8 million and the actual tax benefit realized for the tax deduction from option exercises was approximately $5.2 million in the nine months ended September 30, 2008. As of September 30, 2008, the remaining valuation of stock option awards to be expensed in future periods was $7.5 million and the related weighted-average period over which it is expected to be recognized is 1.4 years.

The fair value of restricted stock unit grants is the market price of the underlying shares on the grant date. A summary of restricted stock unit activity as of September 30, 2008, and changes during the period then ended is presented below:


				Weighted-Average
	Shares			Grant-Date Fair Value

Nonvested at January 1, 2008		21,098		$	29.36
Granted		9,824			34.44
Vested		(9,183	)		28.48

Nonvested at September 30, 2008		21,739		$	32.03

Compensation expense recorded attributable to restricted stock unit grants for the first nine months of 2008 and 2007 was approximately $0.4 million. The fair value of units vested during the nine months ended September 30, 2008 and 2007 was $262 and $212, respectively. The intrinsic value of units vested during the nine months ended September 30, 2008 and 2007 was $324 and $290, respectively. As of September 30, 2008 there was $41 of total unrecognized compensation cost relating to restricted stock unit awards which is expected to be recognized over a weighted average period of 1.2 years.

NOTE 13 — INCOME TAX UNCERTAINTIES

The Company adopted the provisions of FIN 48 on January 1, 2007. As a result of the implementation of FIN 48, the Company recognized a $1.6 million increase in the liability for income tax uncertainties. This increase was accounted for as a reduction to the January 1, 2007 balance of retained earnings, as required by FIN 48. The Company’s policy is to recognize interest and penalties accrued related to unrecognized tax benefits as a component of income taxes. The total amount of accrued interest and penalties as of September 30, 2008 was $1.4 million.

The Company had approximately $7.4 and $6.5 million recorded for income tax uncertainties as of September 30, 2008 and December 31, 2007, respectively. The amount, if recognized, that would impact the effective tax rate is $6.7 and $6.0 million, respectively. The Company anticipates that $0.4 million of the income tax uncertainties amount will be resolved with the settlement of income tax audits over the next 12 months.

NOTE 14 — FAIR VALUE

In September 2006, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards SFAS No. 157, “Fair Value Measurements”, which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The provisions of SFAS No. 157 are effective as of the beginning of our 2008 fiscal year. However, the FASB deferred the effective date of SFAS No. 157, until the beginning of our 2009 fiscal year, as it relates to fair value measurement requirements for nonfinancial assets and liabilities that are not remeasured at fair value on a recurring basis. These nonfinancial assets and liabilities include goodwill, other nonamortizable intangible assets and unallocated purchase price for recent acquisitions which are included within other assets. We partially adopted SFAS No. 157 as it relates to financial assets and liabilities at the beginning of our 2008 fiscal year and our adoption did not have a material impact on our financial statements.

The fair value framework requires 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 September 30, 2008, the fair values of our financial assets and liabilities were categorized as follows:


	Total		Level 1		Level 2		Level 3
*Assets*
Interest rate swap ^(a)	$	965	$	—	$	965	$	—

Total assets at fair value	$	965	$	—	$	965	$	—


*Liabilities*
Forward exchange contracts ^(b)	$	4,145	$	—	$	4,145	$	—

Total liabilities at fair value	$	4,145	$	—	$	4,145	$	—


(a)		Based on third party quotation from financial institution and management’s evaluation of the quotation
(b)		Based on observable market transactions of spot and forward rates

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

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

RESULTS OF OPERATIONS


	Three Months Ended September 30,						Nine Months Ended September 30,
	2008			2007			2008			2007

Net Sales		100.0	%		100.0	%		100.0	%		100.0	%
Cost of sales (exclusive of depreciation shown below)		68.9			68.0			68.2			67.4
Selling, research & development and administration		13.9			13.6			14.5			14.6
Depreciation and amortization		6.1			6.6			6.2			6.5

Operating Income		11.1			11.8			11.1			11.5
Other income (expense)		(0.4	)		(0.6	)		(0.3	)		(0.7	)

Income before income taxes		10.7			11.2			10.8			10.8


Net income		7.5	%		8.1	%		7.5	%		7.5	%


Effective Tax Rate		30.3	%		27.8	%		30.1	%		30.2	%

NET SALES

Net sales for the quarter and nine months ended September 30, 2008 were a record $532 million and $1.6 billion, respectively, and represented increases of 10% and 15%, respectively, over the same periods a year ago. The average U.S. dollar exchange rate weakened compared to the Euro in 2008 compared to 2007, and as a result, changes in exchange rates positively impacted sales and accounted for approximately 7% and 9% of sales growth for the quarter and nine months ended September 30, 2008, respectively. Sales from acquired companies were not material for the quarter and nine months ended September 30, 2008. The remaining sales growth was due primarily to increased demand from our pharmaceutical customers as well as price increases to offset the rising input costs in our Closures and Beauty and Home segments.

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

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


	Three Months Ended September 30,										Nine Months Ended September 30,
	2008		% of Total			2007		% of Total			2008		% of Total			2007		% of Total

Domestic	$	138,116		26	%	$	127,363		26	%	$	401,532		25	%	$	374,805		27	%
Europe		321,165		60	%		297,877		61	%		1,016,384		63	%		873,710		62	%
Other Foreign		72,899		14	%		60,452		13	%		197,841		12	%		159,894		11	%

COST OF SALES (EXCLUSIVE OF DEPRECIATION SHOWN BELOW)

Our cost of sales as a percent of net sales increased to 68.9% in the third quarter of 2008 compared to 68.0% in the third quarter of 2007.

The following factors negatively impacted our cost of sales percentage in the third quarter of 2008:

Rising Input Costs. Input costs, in particular resin, tinplate, utilities and transportation costs, continued to increase in the third quarter of 2008 over 2007, primarily in the U.S. and Europe, but also in the rest of the world. While we attempt to pass these rising input costs along in our selling prices we experience a lag in the timing of passing on these cost increases.

Weakening of the U.S. Dollar. We are a net importer from Europe into the U.S. and other countries of products produced in Europe with costs denominated in Euros. As a result, when the U.S. dollar or other currencies weaken against the Euro, products produced in Europe (with costs denominated in Euros) and sold in currencies that are weaker compared to the Euro, have a negative impact on cost of sales as a percentage of net sales.

Underutilized Overhead Costs in Certain Operations. Certain of our business operations in the Beauty & Home and Closures business segments saw a decrease in unit volumes produced and sold and as a result of the lower production levels, overhead costs were underutilized, thus negatively impacting cost of goods sold as a percentage of net sales.

The following factors positively impacted our cost of sales percentage in the third quarter of 2008:

Improved Product Mix. Sales to the pharmaceutical market in the third quarter of 2008 increased 17% compared to the prior year third quarter and therefore positively impacted or lowered our cost of sales as a percentage of net sales as margins on our pharmaceutical products typically are higher than the overall company average.

Our cost of sales as a percent of net sales increased to 68.2% in the first nine months of 2008 compared to 67.4% in the first nine months of 2007. The increase is primarily due to the same factors mentioned above. In addition, sales of custom tooling increased $11.1 million in the first nine months of 2008 compared to the comparable period in 2007. Traditionally, sales of custom tooling generate lower margins than our regular product sales and, thus, an increase in sales of custom tooling negatively impacts cost of sales as a percentage of sales.

SELLING, RESEARCH & DEVELOPMENT AND ADMINISTRATIVE

Our Selling, Research & Development and Administrative expenses (“SG&A”) increased by approximately $8.1 million in the third quarter of 2008 compared to the same period a year ago. Changes in currency rates accounted for approximately $4.2 million of the increase in SG&A in the quarter. The remainder of the increase is due primarily to normal inflationary cost increases, higher bad debt expense and higher professional fees related to several corporate initiatives. SG&A as a percentage of net sales increased to 13.9% compared to 13.6% of net sales in the same period of the prior year primarily due to the higher bad debts and professional fees.

SG&A increased by approximately $29.2 million for the nine months ended September 30, 2008 compared to the same period a year ago. Changes in currency rates accounted for approximately $17.7 million of the increase in SG&A. The remainder of the increase is due primarily to the reasons mentioned above as well as higher research and development costs in the first quarter. SG&A as a percentage of net sales decreased to 14.5% compared to 14.6% of net sales in the same period of the prior year primarily due to the reduction in stock option expense in the first nine months of $2.5 million.

DEPRECIATION AND AMORTIZATION

Depreciation and amortization increased approximately $0.5 million in the third quarter of 2008 to $32.5 million compared to $32.1 million in the third quarter of 2007. Changes in foreign currency rates accounted for $2.1 million of the increase. Depreciation and amortization as a percentage of sales decreased to 6.1% of net sales for the third quarter of 2008 compared to 6.6% in the same period of the prior year.

Depreciation and amortization increased approximately $7.6 million in the first nine months of 2008 to $99.9 million compared to $92.2 million for the first nine months of 2007. Changes in foreign currency rates accounted for $8.8 million of the increase. Depreciation and amortization as a percentage of sales decreased to 6.2% of net sales for the nine months ended September 30, 2008 compared to 6.5% in the same period of the prior year.

OPERATING INCOME

Operating income increased approximately $1.7 million in the third quarter of 2008 to $59.2 million compared to $57.4 million in the same period in the prior year. The increase is primarily due to the increase in sales of our products to the pharmaceutical market and the continued strength of the Euro compared to the U.S. dollar which is having a positive impact on the translation of our results in U.S. dollars. This was partially offset by higher cost of goods sold and SG&A costs mentioned above. Operating income as a percentage of net sales decreased to 11.1% in the third quarter of 2008 compared to 11.8% for the same period in the prior year.

Operating income increased approximately $17.5 million in the first nine months of 2008 to $179.1 million compared to $161.6 million in the same period in the prior year. The increase is primarily due to the increase in sales of our products mentioned above and the continued strength of the Euro compared to the U.S. dollar. Operating income as a percentage of sales decreased to 11.1% in the first nine months of 2008 compared to 11.5% for the same period in the prior year.

NET OTHER EXPENSE

Net other expenses in the third quarter of 2008 decreased to $2.3 million from $2.8 million in the same period in the prior year primarily reflecting increased interest income of $1.3 million partially offset by increased interest expense of $0.4 million and $0.3 million increase in miscellaneous expense primarily due to foreign currency losses. The increase in interest income is due primarily to higher average cash and equivalents on the balance sheet.

Net other expenses for the nine months ended September 30, 2008 decreased to $4.8 million from $9.8 million in the same period in the prior year primarily reflecting increased interest income of $4.7 million. The increase in interest income is due primarily to higher average cash and equivalents on the balance sheet.

EFFECTIVE TAX RATE

The reported effective tax rate increased to 30.3% for the three months ended September 30, 2008 compared to 27.8% in the third quarter of 2007. The lower effective tax rate in the third quarter of 2007 is due primarily to a positive tax benefit in the third quarter of last year related to tax law changes in Germany. During the third quarter of 2007, the German government approved a

reduction in the income tax rate effective January 1, 2008. This tax law change reduced the Company’s net deferred tax liability by approximately $2.3 million, or approximately $0.03 per share.

The reported effective tax rate decreased slightly to 30.1% for the nine months ended September 30, 2008 compared to 30.2% in the first nine months of the prior year. As mentioned above, the prior year effective tax rate was positively impacted by the reduction in the Company’s net deferred tax liability. This year, the effective tax rate is being impacted by the reduction of the German and Italian statutory tax rates effective in 2008 as well as higher research and development credits expected to be received in France in 2008.

NET INCOME

We reported net income of $39.7 million and $121.8 million in the third quarter and nine months ended September 30, 2008, respectively, compared to $39.4 million and $105.9 million for the same periods in the prior year.

BEAUTY & HOME SEGMENT

Operations that sell spray and lotion dispensing systems primarily to the personal care, fragrance/cosmetic and household markets form the Beauty & Home segment.


	Three Months Ended September 30,						Nine Months Ended September 30,
	2008			2007			2008			2007

Net Sales	$	271,654		$	258,613		$	844,328		$	750,757
Segment Income (1)		21,701			25,561			77,904			78,136
Segment Income as a percentage of Net Sales		8.0	%		9.9	%		9.2	%		10.4	%

(1) Segment income is defined as earnings before net interest, stock option and corporate expenses, income taxes and unusual items. The Company evaluates performance of its business units and allocates resources based upon segment income. For a reconciliation of segment income to income before income taxes, see Note 10 – Segment information to the Consolidated Financial Statements in Item 1.

Net sales for the quarter ended September 30, 2008 increased 5% in the third quarter of 2008 to $271.7 million compared to $258.6 million in the third quarter of the prior year. Acquisitions did not have a material impact on the sales growth in the third quarter. Changes in exchange rates positively impacted sales by approximately 6% during the quarter. Excluding changes in exchange rates, sales decreased 1% in the third quarter of 2008 compared to the same quarter of the prior year. Sales to the personal care market excluding changes in currency and acquisitions remained flat in the third quarter of 2008 compared to the same period in the prior year, due primarily to lower sales volumes in Europe. Sales to the fragrance/cosmetic market excluding changes in currency and acquisitions decreased 1% in the quarter compared to the third quarter of 2007 as growth in the developing markets was not enough to offset weakening demand in Europe and North America.

Net sales for the first nine months of 2008 increased 12% in the first nine months of 2008 to $844.3 million compared to $750.8 million in the first nine months of the prior year. The weakening U.S. dollar compared to the Euro positively impacted sales and represented approximately 9% of the 12% increase in sales. Acquisitions did not materially impact the sales growth in the first nine months of 2008. Sales to the personal care market excluding foreign currency changes increased approximately 3% in the first nine months of 2008 compared to the same period in the prior year primarily due to strong sales of our bag-on-valve product line and lotion pumps during the first half of the year. Sales to the fragrance/cosmetic market excluding foreign currency changes increased approximately 4% in the first nine months of 2008 compared to the same period in the prior year primarily due to strong sales of our mini-packaging products in Europe as well as continued growth in the developing markets in the first nine months of the year.

Segment income in the third quarter of 2008 decreased approximately 15% to $21.7 million compared to $25.6 million reported in the same period in the prior year. Acquisitions did not materially impact segment income in the quarter. The decrease in segment income is due primarily to the rising input costs particularly in North America but also in Europe on materials such as resin, tinplate and phosphoric acid used in the metal anodization process. In addition, weakening demand and lower sales volumes primarily in Europe negatively impacted the segment income in the quarter.

Segment income in the first nine months of 2008 decreased slightly to $77.9 million compared to $78.1 million reported in the same period in the prior year. Acquisitions had an immaterial impact on segment income in the first nine months. Weakening demand in the third quarter combined with our inability to raise selling prices fast enough to keep pace with the rising input costs, primarily in North America, were the primary reasons for the lack of growth in segment income for the first nine months of 2008.

CLOSURES SEGMENT

The Closures segment designs and manufactures primarily dispensing closures. These products are sold primarily to the personal care, household and food/beverage markets.


	Three Months Ended September 30,						Nine Months Ended September 30,
	2008			2007			2008			2007

Net Sales	$	142,424		$	126,519		$	420,945		$	368,032
Segment Income		12,616			12,494			36,669			39,838
Segment Income as a percentage of Net Sales		8.9	%		9.9	%		8.7	%		10.8	%

Net sales for the quarter ended September 30, 2008 increased approximately 13% in the third quarter of 2008 to $142.4 million compared to $126.5 million in the third quarter of the prior year. Changes in exchange rates positively impacted sales by approximately 7% during the quarter. Increased selling prices due to the rising cost of resin in the quarter accounted for approximately 5% of the remaining sales growth. Sales excluding changes in foreign currency to the personal care market increased approximately 3% in the third quarter compared to the same period in the prior year reflecting increased demand in North America which helped offset weakening demand in Europe and Brazil. Sales excluding changes in foreign currency to the food/beverage market increased 19% as new customer launches primarily in North America helped drive the strong growth in the quarter. Sales excluding changes in foreign currency to the household market decreased 13% primarily due to lower tooling sales which accounted for approximately 7% of the 13% decrease and lower sales of laundry care products in Europe.

Net sales for the first nine months of 2008 increased approximately 14% to $420.9 million compared to $368.0 million in the first nine months of the prior year. Once again, the weakening U.S. dollar compared to the Euro positively impacted sales and represented approximately 7% of the 14% increase. Increased selling prices due the rising cost of resin for the first nine months accounted for approximately 4% of the sales growth and sales of custom tooling accounted for the remaining 3% of the sales growth. Sales excluding changes in foreign currency to the personal care market increased approximately 3% for the first nine months of 2008, while sales excluding changes in foreign currency to the food/beverage market increased 21% for the first nine months of 2008. Partially offsetting this growth was a decrease in sales excluding changes in foreign currency to the household market of approximately 11%.

Segment income in the third quarter of 2008 increased approximately 1% to $12.6 million compared to $12.5 million reported in the same period in the prior year. The positive impact of the higher sales volumes in North America, primarily to the food/beverage market was offset by lower demand in Europe and Brazil leading to under utilization of capacity. In addition, the normal delays we experience in passing on increased resin costs in the form of price increases also negatively impacted segment income in the quarter.

Segment income in the first nine months of 2008 decreased approximately 8% to $36.7 million compared to $39.8 million reported in the same period of the prior year. Weak demand in North America in the first half of the year combined with weakening demand in Europe and Brazil in the third quarter led to underutilization of capacity during the first nine months of 2008 and, as mentioned previously, our normal delays in passing on increased resin costs in the form of price increases also negatively impacted the segment income in the first nine months of 2008.

PHARMACEUTICAL SEGMENT

Operations that sell dispensing systems to the pharmaceutical market form the Pharma segment.


	Three Months Ended September 30,						Nine Months Ended September 30,
	2008			2007			2008			2007

Net Sales	$	118,102		$	100,559		$	350,479		$	289,617
Segment Income		34,408			29,407			99,275			78,445
Segment Income as a percentage of Net Sales		29.1	%		29.2	%		28.3	%		27.1	%

Our net sales for the Pharma segment grew by 17% in the third quarter of 2008 to $118.1 million compared to $100.6 million in the third quarter of 2007. Changes in foreign currency rates positively impacted the sales growth and accounted for approximately 7% of the 17% sales growth. The remainder of the increase in sales is due primarily to an increase in sales of our metered dose inhaler valves used on asthma medication and an increase in sales of our nasal spray pumps primarily used on allergy related products. Sales to pharmaceutical companies offering generic versions of allergy medication in the U.S. were strong in the third quarter.

Our net sales for the Pharma segment grew by 21% in the first nine months of 2008 to $350.5 million compared to $289.6 million in the first nine months of 2007. Changes in foreign currency rates positively impacted the sales growth by approximately 11% for the first nine months of 2008. The remaining 10% increase in sales was due to an increase in demand for our metered dose inhaler valves as well as an increase in demand for our nasal spray pumps, primarily for allergy related medication.

Segment income in the third quarter of 2008 increased approximately 17% to $34.4 million compared to $29.4 million reported in the same period in the prior year. The increase in profit is primarily due to the increase in product sales compared to the prior year third quarter.

Segment income in the first nine months of 2008 increased approximately 27% to $99.3 million compared to $78.4 million reported in the same period in the prior year. Once again the higher sales volumes and improved product and customer mix were the main reasons for the increase in profits in the first nine months of 2008.

FOREIGN CURRENCY

A significant number of our operations are located outside of the United States. Because of this, movements in exchange rates may have a material impact on the translation of the financial statements of our foreign entities. Our primary foreign exchange exposure is to the Euro, but we have foreign exchange exposure to South American and Asian currencies, among others. We manage our foreign exchange exposures principally with forward exchange contracts to hedge certain transactions and firm purchase and sales commitments denominated in foreign currencies. A weakening U.S. dollar relative to foreign currencies has an additive translation effect on our financial statements. Conversely, a strengthening U.S. dollar has a dilutive effect. In some cases, we sell products denominated in a currency different from the currency in which the related costs are incurred. Changes in exchange rates on such inter-country sales could materially impact our results of operations.

QUARTERLY TRENDS

Our results of operations in the last quarter of the year typically are negatively impacted by plant shutdowns in December. In the future, our results of operations in a quarterly period could be impacted by factors such as changes in product mix, changes in material costs, changes in growth rates in the industries to which our products are sold, recognition of equity based compensation expense for retirement eligible employees in the period of grant and changes in general economic conditions in any of the countries in which we do business.

LIQUIDITY AND CAPITAL RESOURCES

Our primary sources of liquidity are cash flow from operations and our revolving credit facility. Cash and equivalents decreased to $301.2 million from $313.7 million at December 31, 2007. Total short and long-term interest bearing debt increased in the first nine months of 2008 to $400.1 million from $362.9 million at December 31, 2007. The ratio of our Net Debt (interest bearing debt less cash and cash equivalents) to Net Capital (stockholder’s equity plus Net Debt) increased at the end of September 2008 to 8% compared to 4% at December 31, 2007.

In the first nine months of 2008, our operations provided approximately $203.2 million in cash flow compared to $186.8 million for the same period a year ago. In both periods, cash flow from operations was primarily derived from earnings before depreciation and amortization partially offset by an increase in working capital needs to support the growth of the business. During the first nine months of 2008, we utilized the majority of the operating cash flows to finance capital expenditures and share repurchases.

We used $172.4 million in cash for investing activities during the first nine months of 2008, compared to $94.1 million during the same period a year ago. The increase in cash used for investing activities is due primarily to $66.7 million more spent on capital expenditures in the first nine months of 2008 compared to the first nine months of 2007. The increase in capital expenditures is primarily related to the purchase of a building in the U.S. that had previously been leased, the expansion of our Pharma segment facilities in France and Germany, investment in a new worldwide ERP system, and investments related to capacity increases for certain of our product lines. Cash outlays for capital expenditures for 2008 are estimated to be approximately $180 million but could vary due to changes in exchange rates as well as the timing of capital projects.

We used approximately $30.9 million in cash from financing activities in the first nine months of 2008 compared to $11.6 million in cash provided in the first nine months of the prior year. We refinanced some of our short term variable rate debt with a $100 million fixed rate private placement debt in the quarter. $25 million of the private placement debt has a five year maturity and a fixed interest rate of 5.41% while the remaining $75 million matures in ten years and carries a 6.03% fixed interest rate.

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


	Requirement	Level at September 30, 2008
Debt to total capital ratio	Maximum of 55%	26%

Based upon the above debt to total capital ratio covenant we would have the ability to borrow an additional $994 million before the 55% requirement would be exceeded.

Our foreign operations have historically met cash requirements with the use of internally generated cash or borrowings. Foreign subsidiaries have financing arrangements with several foreign banks to fund operations located outside the U.S., but all these lines are uncommitted. Cash generated by foreign operations has generally been reinvested locally. The majority of our $301.2 million in cash and equivalents is located outside of the U.S.

We believe we are in a strong financial position and have the financial resources to meet business requirements in the foreseeable future. We have historically used cash flow from operations as our primary source of liquidity. In the event that customer demand would decrease significantly for a prolonged period of time and negatively impact cash flow from operations, we would have the ability to restrict and significantly reduce capital expenditure levels, which historically have been the most significant use of cash for us. 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. While we believe our balance sheet remains strong, we have decided to temporarily suspend the repurchase of the Company’s common stock in order to conserve cash in the short term due to the uncertainties related to the recent worldwide credit crisis. We will evaluate this decision throughout the fourth quarter.

On October 15, 2008, the Board of Directors declared a quarterly dividend of $0.15 per share payable on November 19, 2008 to stockholders of record as of October 29, 2008.

OFF-BALANCE SHEET ARRANGEMENTS

We lease certain warehouse, plant and office facilities as well as certain equipment under noncancelable operating leases expiring at various dates through the year 2055. 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. Other than operating lease obligations, we do not have any off-balance sheet arrangements

ADOPTION OF ACCOUNTING STANDARDS

In December 2007, the FASB issued SFAS No. 141(R), “Business Combinations.” SFAS No. 141(R) establishes principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree and recognizes and measures the goodwill acquired in the business combination or a gain from a bargain purchase. SFAS No. 141(R) also sets forth the disclosures required to be made in the financial statements to evaluate the nature and financial effects of the business combination. SFAS No. 141(R) applies prospectively to business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2008. Accordingly, SFAS No. 141(R) will be applied by the Company to business combinations occurring on or after January 1, 2009.

In December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements , an amendment of ARB No. 51.” SFAS No. 160 establishes accounting and reporting standards that require that the ownership interests in subsidiaries held by parties other than the parent be clearly identified, labeled, and presented in the consolidated statement of financial position within equity, but separate from the parent’s equity; the amount of consolidated net income attributable to the parent and to the noncontrolling interest be clearly identified and presented on the face of the consolidated statement of income; and changes in a parent’s ownership interest while the parent retains its controlling financial interest in its subsidiary be accounted for consistently. SFAS No. 160 also requires that any retained noncontrolling equity investment in the former subsidiary be initially measured at fair value when a subsidiary is deconsolidated. SFAS No. 160 also sets forth the disclosure requirements to identify and distinguish between the interests of the parent and the interests of the noncontrolling owners. SFAS No. 160 applies to all entities that prepare consolidated financial statements, except not-for-profit organizations, but will affect only those entities that have an outstanding noncontrolling interest in one or more subsidiaries or that deconsolidate a subsidiary. SFAS No. 160 is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008. Earlier adoption is prohibited. SFAS No. 160 must be applied prospectively as of the beginning of the fiscal year in which it is initially applied, except for the presentation and disclosure requirements. The presentation and disclosure requirements are applied retrospectively for all periods presented. The Company currently has immaterial noncontrolling interests in two subsidiaries. The Company does not believe that the adoption of SFAS No. 160 will materially impact the presentation of the financial results of the Company.

In March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities—an amendment of FASB Statement No. 133,” (SFAS 161). SFAS 161 requires enhanced disclosures about an entity’s derivative and hedging activities, including (i) how and why an entity uses derivative instruments, (ii) how derivative instruments and related hedged items are accounted for under SFAS 133, and (iii) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. This standard becomes effective on January 1, 2009. Earlier adoption of SFAS 161 and, separately, comparative disclosures for earlier periods at initial adoption are encouraged. As SFAS 161 only requires enhanced disclosures, this standard will have no impact on the financial position, results of operations, or cash flows of the Company.

In April 2008, the FASB issued FSP No. FAS 142-3, “Determination of the Useful Life of Intangible Assets,” (FSP FAS 142-3). FSP FAS 142-3 amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under FASB Statement No. 142, “Goodwill and Other Intangible Assets,” (SFAS 142) in order to improve the consistency between the useful life of a recognized intangible asset under SFAS 142 and the period of expected cash flows used to measure the fair value of the asset under SFAS 141(R) and other GAAP. FSP FAS 142-3 becomes effective on January 1, 2009. Management has concluded that the adoption of FSP FAS 142-3 will not have a material impact on the Financial Statements.

OUTLOOK

The U.S. dollar began to strengthen at the end of the third quarter relative to the Euro and most other currencies and at the end of the quarter it was stronger compared to the Euro than it was at the end of the third quarter of 2007. If the dollar remains stronger for the remainder of the fourth quarter, we can expect a dilutive effect on the translation of our results into U.S. dollars.

We anticipate weak demand in both our Beauty and Home and Closures segments to continue as the worldwide credit crisis and economic fears cause our customers to delay and push out their orders. Offsetting this, we are anticipating that our strong sales we have experienced so far in the first nine months of 2008 to the Pharma segment will continue into the fourth quarter.

Also we are beginning to see some relief in raw material input prices particularly in plastic resin heading into the fourth quarter.

We anticipate that diluted earnings per share for the fourth quarter of 2008 will be in the range of $0.42 to $0.47 per share, compared to $0.47 per share from continuing operations reported in the prior year.

FORWARD-LOOKING STATEMENTS

This Management’s Discussion and Analysis and certain other sections of this Form 10-Q contain forward-looking statements that involve a number of risks and uncertainties. Words such as “expects,” “anticipates,” “believes,” “estimates,” 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 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:

•		economic, environmental and political conditions worldwide;
•		changes in customer and/or consumer spending levels;
•		the cost of materials and other input costs (particularly resin, metal, anodization costs and transportation and energy costs);
•		the availability of raw materials and components (particularly from sole sourced suppliers);
•		significant fluctuations in foreign currency exchange rates;
•		our ability to increase prices;
•		our ability to contain costs and improve productivity;
•		changes in capital availability or cost, including interest rate fluctuations;
•		our ability to meet future cash flow estimates to support our goodwill impairment testing;
•		direct or indirect consequences of acts of war or terrorism;
•		difficulties in complying with government regulation;
•		competition, including technological advances;
•		our ability to protect and defend our intellectual property rights;
•		the timing and magnitude of capital expenditures;
•		our ability to identify potential new acquisitions and to successfully acquire and integrate such operations or products;
•		work stoppages due to labor disputes;
•		the demand for existing and new products (including delays in orders);
•		fiscal and monetary policy, including changes in worldwide tax rates;
•		our ability to manage worldwide customer launches of complex technical products, in particular in developing markets;
•		the success of our customers’ products, particularly in the pharmaceutical industry;
•		difficulties in product development and uncertainties related to the timing or outcome of product development;
•		significant product liability claims;
•		our successful implementation of a new worldwide ERP system starting in 2009 without disruption to our operations; and
•		other risks associated with our operations.

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. Please refer to Item 1A (“Risk Factors”) of Part 1 included in the Company’s Annual Report on Form 10-K for additional risk factors affecting the Company.

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 South American and Asian currencies, among others. 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 has a dilutive effect.

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 September 30, 2008 about our forward currency exchange contracts. The majority of the contracts expire before the end of the third quarter of 2009 with the exception of a few contracts on intercompany loans that expire in third quarter of 2013.


	Contract Amount		Average Contractual
Buy/Sell	(in thousands)		Exchange Rate

Swiss Francs/Euro	$	35,220		0.6273
Euro/U.S. Dollar		32,615		1.4896
Euro/Brazilian Real		7,830		4.3275
Euro/Swiss Franc		7,498		1.6006
Czech Koruna/Euro		7,179		0.0414
US Dollar/Euro		4,354		0.7040
Euro /Russian Rouble		4,001		37.6822
Euro/British Pound		3,867		0.7983
Canadian Dollar/ US Dollar		2,950		0.9361
Euro/Chinese Yuan		1,801		10.1726
Other		2,087

Total	$	109,402

As of September 30, 2008, we have recorded the fair value of foreign currency forward exchange contracts of $2.2 million in accounts payable and accrued liabilities and $1.9 million in deferred and other non-current liabilities in the balance sheet.

At September 30, 2008, we had a fixed-to-variable interest rate swap agreement designated as a hedge with a notional principal value of $15 million which requires us to pay an average variable interest rate (which was 2.8% at September 30, 2008) and receive a fixed rate of 6.6%. The variable rate is adjusted semiannually based on London Interbank Offered Rates (“LIBOR”). Variations in market interest rates would produce changes in our net income. If interest rates increase by 100 basis points, net income related to the interest rate swap agreement would decrease approximately $0.1 million assuming a tax rate of 30%. As of September 30, 2008, we recorded the fair value of the fixed-to-variable interest rate swap agreement of $1.0 million in miscellaneous other assets with an offsetting adjustment to debt. No gain or loss was recorded in the income statement in 2008 as any hedge ineffectiveness for the period is immaterial.

ITEM 4. CONTROLS AND PROCEDURES

DISCLOSURE CONTROLS AND PROCEDURES

The Company’s management has evaluated, with the participation of the chief executive officer and chief financial officer of the Company, the effectiveness of the Company’s disclosure controls and procedures (as that term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of September 30, 2008. 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

No change in the Company’s internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Securities Exchange Act of 1934) occurred during the Company’s fiscal quarter ended September 30, 2008 that materially affected, or is reasonably like to materially affect, the Company’s internal control over financial reporting.

PART II – OTHER INFORMATION

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

RECENT SALES OF UNREGISTERED SECURITIES

During the quarter ended September 30, 2008, the FCP Aptar Savings Plan (the “Plan”) purchased 800 shares of our common stock on behalf of the participants at an average price of $38.81 per share, for an aggregate amount of $31 thousand and sold 1,950 shares of our common stock on behalf of the participants at an average price of $40.22 per share, for an aggregate amount of $78 thousand. At September 30, 2008, the Plan owns 15,454 shares of our common stock. The employees of AptarGroup S.A.S. and Valois S.A.S., our subsidiaries, are eligible to participate in the Plan. All eligible participants are located outside of the United States. 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 Asset Management. 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.

ISSUER PURCHASES OF EQUITY SECURITIES

The following table summarizes the Company’s purchases of its securities for the quarter ended September 30, 2008:


					Total Number Of Shares		Maximum Number Of
	Total Number				Purchased As Part Of		Shares That May Yet Be
	Of Shares		Average Price		Publicly Announced		Purchased Under The
Period	Purchased		Paid Per Share		Plans Or Programs		Plans Or Programs

7/1 – 7/31/08		240,000	$	37.81		240,000		4,843,757
8/1 – 8/31/08		201,700		39.31		201,700		4,642,057
9/1 – 9/30/08		93,500		39.48		93,500		4,548,557

Total		535,200	$	38.67		535,200		4,548,557

The Company announced the existing repurchase program on July 19, 2006. On July 17, 2008, the Company announced that its Board of Directors authorized the Company to repurchase an additional four million shares of its outstanding common stock. There is no expiration date for these repurchase programs.

ITEM 6. EXHIBITS


Exhibit 10.1		AptarGroup, Inc. Supplemental Retirement Plan (amended and restated effective January 1, 2009)

Exhibit 10.2		Severance Agreement dated July 18, 2008 of Robert Kuhn.

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.

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 (Duly Authorized Officer and Principal Financial Officer)

	Date: November 4, 2008

INDEX OF EXHIBITS


Exhibit
Number		Description

10.1		AptarGroup, Inc. Supplemental Retirement Plan (amended and restated effective January 1, 2009)
10.2		Severance Agreement dated July 18, 2008 of Robert Kuhn,
31.1		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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 10.1

AptarGroup, Inc.

Supplemental Retirement Plan

(amended and restated effective January 1, 2009)

AptarGroup, Inc.
Supplemental Retirement Plan
(amended and restated effective January 1, 2009)

Contents


			Page
Article I.		Introduction		1

	1.1	Purpose of the Plan		1
	1.2	Effective Date		1
	1.3	Nonqualified Plan		1

Article II.		Definitions		1

	2.1	Definitions		1
	2.2	Gender and Number; Headings		5

Article III.		Participation and Service		5

	3.1	Participation		5
	3.2	Duration of Participation		5

Article IV.		Vesting and Optional Forms of Payment		5

	4.1	Vesting		5
	4.2	Forfeiture of Supplemental Retirement Benefit		6
	4.3	Annuity Options		6

Article V.		Time of Payment		6

	5.1	Default Time of Payment		6
	5.2	Deferral Election		6
	5.3	Small Amount Cash-Outs		7
	5.4	Distributions to Specified Employees		7

Article VI.		Spousal Benefit		7

	6.1	Amount of Benefit		7
	6.2	Payment of Spousal Benefit		7

Article VII.		Administration		7


			Page
	7.1	Plan Administrator		7
	7.2	Plan Administrator's Duties		8
	7.3	Manner of Action		8
	7.4	Records		8
	7.5	Information Required for Plan Administrator		8
	7.6	Decision of Plan Administrator Final		8
	7.7	Review of Benefit Determinations		9
	7.8	Uniform Rules		9
	7.9	Interested Plan Administrator		9
	7.10	Indemnification		9
	7.11	Immunity of Committee Members		9
	7.12	No Enlargement of Employee Rights		10
	7.13	Notice of Address and Missing Persons		10

Article VIII.		Trust		10

Article IX.		Miscellaneous		10

	9.1	Amendment and Termination		10
	9.2	Incompetency		11
	9.3	Nonalienation		11
	9.4	Applicable law		11
	9.5	Severability		12
	9.6	Notice		12
	9.7	Costs of the Plan		12
	9.8	Successors		12
	9.9	Subordination of Rights		12
	9.10	Counterparts		12
	9.11	Taxes		12

Article I. Introduction

1.1 Purpose of the Plan

The Company sponsors the Qualified Plan, which is intended to be a tax-qualified plan under section 401(a) of the Code. The purpose of the Plan is to provide retirement plan benefits to Members that they would have been entitled to receive under the Qualified Plan if the limitations of Code sections 401(a)(17) and 415 of the Code did not apply.

1.2 Effective Date

The Plan replaces the AptarGroup, Inc. Supplemental Retirement Plan, effective as of January 1, 1994 (the “Prior Plan”), effective as of January 1, 2009. Amounts earned before January 1, 2005 shall be governed by the terms of the Prior Plan to the extent that a Member was fully vested on January 1, 2005 in such amounts. To the extent that a Member was not vested in such amounts, those amounts shall be governed before January 1, 2009 by the terms of the Prior Plan, as modified in operation to comply with section 409A of the Code. Amounts earned on and after January 1, 2005 and before January 1, 2009 shall also be governed by the terms of the Prior Plan, as modified in operation to comply with section 409A of the Code.

1.3 Nonqualified Plan

The Plan is intended to be an unfunded deferred compensation plan maintained primarily for the purpose of providing benefits to a select group of management or highly compensated Employees within the meaning of sections 201(2), 301(a)(3) and 401(a)(1) of ERISA and Department of Labor Regulation § 2520.104-23. Such benefits shall be reflected on the accounting records of the Employers but shall not be construed to create or require the creation of a trust, custodial account or escrow account. No Member shall have any right, title or interest whatsoever in or to any investment reserves, accounts or funds that the Company or any Employer may purchase, establish or accumulate to aid in providing benefits under the Plan. Nothing contained in the Plan, and no action taken pursuant to its provisions, shall create a trust or fiduciary relationship of any kind between an Employer and an Employee or any other person. All benefits payable hereunder shall be paid from the general assets of the Employers, and Members shall not have any greater rights to such assets than other general creditors of the Employers.

Article II. Definitions

2.1 Definitions

Capitalized terms used in the Plan shall have the meanings set forth below unless otherwise expressly provided herein. If a capitalized term is not defined below, it shall have the meaning set forth in the Qualified Plan.

(a) “Actuarial Equivalent” means the actuarial equivalent value of an applicable form of benefit distribution.

(b) “Board” means the Board of Directors of the Company.

(c)

“Change in Control” means:

	(1)		the acquisition by any individual, entity or group (a “Person”), including any “person” within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), of beneficial ownership within the meaning of Rule 13d-3 promulgated under the Exchange Act, of more than 50% of either (i) the then outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (ii) the combined voting power of the then outstanding securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that the following acquisitions shall not constitute a Change in Control: (A) any acquisition directly from the Company (excluding any acquisition resulting from the exercise of a conversion or exchange privilege in respect of outstanding convertible or exchangeable securities unless such outstanding convertible or exchangeable securities were acquired directly from the Company), (B) any acquisition by the Company, (C) any acquisition by an employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company or (D) any acquisition by any corporation pursuant to a reorganization, merger or consolidation involving the Company, if, immediately after such reorganization, merger or consolidation, each of the conditions described in clauses (i), (ii) and (iii) of subsection (3) of this definition shall be satisfied; and provided further that, for purposes of clause (B), if any Person (other than the Company or any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company) shall become the beneficial owner of more than 50% of the Outstanding Company Common Stock or more than 50% of the Outstanding Company Voting Securities by reason of an acquisition by the Company and such Person shall, after such acquisition by the Company, become the beneficial owner of any additional shares of the Outstanding Company Common Stock or any additional Outstanding Company Voting Securities and such beneficial ownership is publicly announced, such additional beneficial ownership shall constitute a Change in Control;

	(2)		individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of such Board; provided, however, that any individual who becomes a director of the Company subsequent to the date hereof whose election, or nomination for election by the Company’s stockholders, was approved by the vote of at least a majority of the directors then comprising the Incumbent Board shall be deemed to have been a member of the Incumbent Board; and provided further, that no individual who was initially elected as a director of the Company as a result of an actual or threatened solicitation by a Person other than the Board for the purpose of opposing a solicitation by any other Person with respect to the election or removal of directors or any other actual or threatened solicitation of proxies or consents by or on behalf of any Person other than the Board shall be deemed to have been a member of the Incumbent Board;

	(3)		consummation of a reorganization, merger or consolidation unless, in any such case, immediately after such reorganization, merger or consolidation, (i) 50% or more of the then outstanding shares of common stock of the corporation resulting from such reorganization, merger or consolidation and 50% or more of the combined voting power of the then outstanding securities of such corporation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals or entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such reorganization, merger or consolidation and in substantially the same proportions relative to each other as their ownership, immediately prior to such reorganization, merger or consolidation, of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as the case may be, (ii) no Person (other than the Company, any employee benefit plan (or related trust) sponsored or maintained by the Company or the corporation resulting from such reorganization, merger or consolidation (or any corporation controlled by the Company) and any Person which beneficially owned, immediately prior to such reorganization, merger or consolidation, directly or indirectly, more than 50% of the Outstanding Company Common Stock or the Outstanding Company Voting Securities, as the case may be) beneficially owns, directly or indirectly, more than 50% of the then outstanding shares of common stock of such corporation or more than 50% of the combined voting power of the then outstanding securities of such corporation entitled to vote generally in the election of directors and (iii) at least a majority of the members of the board of directors of the corporation resulting from such reorganization, merger or consolidation were members of the Incumbent Board at the time of the execution of the initial agreement or action of the Board providing for such reorganization, merger or consolidation; or

	(4)		consummation of (i) a plan of complete liquidation or dissolution of the Company or (ii) the sale or other disposition of all or substantially all of the assets of the Company other than to a corporation with respect to which, immediately after such sale or other disposition, (A) 50% or more of the then outstanding shares of common stock thereof and 50% or more of the combined voting power of the then outstanding securities thereof entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such sale or other disposition and in substantially the same proportions relative to each other as their ownership, immediately prior to such sale or other disposition, of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as the case may be, (B) no Person (other than the Company, any employee benefit plan (or related trust) sponsored or maintained by the Company or such corporation (or any corporation controlled by the Company) and any Person which beneficially owned, immediately prior to such sale or other disposition, directly or indirectly, more than 50% of the Outstanding Company Common Stock or the Outstanding Company Voting Securities, as the case may be) beneficially owns, directly or indirectly, more than

50% of the then outstanding shares of common stock thereof or more than 50% of the combined voting power of the then outstanding securities thereof entitled to vote generally in the election of directors and (C) at least a majority of the members of the board of directors thereof were members of the Incumbent Board at the time of the execution of the initial agreement or action of the Board providing for such sale or other disposition.

(d) “Code” means the Internal Revenue Code of 1986, as it may be amended from time to time.

(e) “Committee” means the person or persons appointed to administer the Plan as described in Section 7.1.

(f) “Employee” means any person who is employed by an Employer.

(g) “Employer” means the Company, a subsidiary or another entity related with the Company that participates in the Qualified Plan.

(h) “Member” means a Participant or a former Participant who has not received a full distribution of his vested Supplemental Retirement Benefit.

(i) “Participant” means any Employee who has met and continues to meet the eligibility requirements of the Plan as set forth in Section 3.1.

(j) “Plan” means the AptarGroup, Inc. Supplemental Retirement Plan, as provided herein and as may be amended from time to time.

(k) “Plan Administrator” means the Committee.

(l) “Plan Year” means the calendar year.

(m) “Prior Plan” means the AptarGroup, Inc. Supplemental Retirement Plan, effective as of January 1, 1994 and as amended from time to time.

(n) “Qualified Plan” means the AptarGroup, Inc. Employees’ Retirement Plan, as amended from time to time.

(o) “Retirement” means an Employee’s Separation from Service from all Employers on or after the earlier of (i) the attainment of age 55 and completion of at least ten (10) Years of Service with the Employers under the Qualified Plan and (ii) the attainment of age 65.

(p) “Separation from Service” means the Participant’s separation from service from his Employer, as described in Treasury Regulation § 1.409A-1(h).

(q) “Specified Employee” means an Employee identified as such pursuant to the document entitled “AptarGroup, Inc. Policy Regarding § 409A Specified Employees.”

(r) “ Supplemental Earnings” means, for each Plan Year, the difference between (i) the Participant’s Earnings for the Plan Year calculated under the Qualified Plan as if the limitation of section 401(a)(17) of the Code was not in effect and (ii) the Participant’s Earnings for the Plan Year under the Qualified Plan.

(s) “Supplemental Retirement Benefit” means, in the case of Retirement because of a Member’s attainment of age 65, the single lump sum amount payable under the Plan, which shall be equal to the sum of (i) 1.85 percent of the Member’s Supplemental Earnings for each Year of Service completed by the Member, to a maximum of 35 Years of Service, and (ii) 1.2 percent of such Member’s Supplemental Earnings for each Year of Service completed by the Member in excess of 35 Years of Service. The Supplemental Retirement Benefit of a Member whose Retirement occurs because he has attained age 55 and completed at least ten (10) Years of Service with the Employers rather than because he attained age 65 shall be the Actuarial Equivalent of the single lump sum amount described in the previous sentence.

2.2 Gender and Number; Headings

Unless the context clearly requires otherwise, the masculine pronoun whenever used shall include the feminine and neuter pronoun, and the singular form whenever used shall include the plural form. Headings of sections of the Plan are inserted for convenience of reference and are not part of the Plan and are not to be considered in the construction thereof.

Article III. Participation and Service

3.1 Participation

An Employee shall become a Participant in the Plan as of the first day he meets all of the following requirements:

(a) he is a participant in the Qualified Plan; and

(b) his earnings exceed the annual compensation limit under section 401(a)(17) of the Code or his accrued benefit under the Qualified Plan is limited by section 415(b) of the Code.

3.2 Duration of Participation

A Participant shall remain a Participant in the Plan until the Participant incurs a Separation from Service from all Employers. Thereafter, such former Participant shall be a Member until he has received a full distribution of his vested Supplemental Retirement Benefit.

Article IV. Vesting and Optional Forms of Payment

4.1 Vesting

Each Participant shall become vested in his Supplemental Retirement Benefit as of the earlier of (a) the first date on which he attains age 55 and completes at least ten (10) Years of Service under the Qualified Plan and (b) the date on which he attains age 65. Notwithstanding the

foregoing, a Participant shall become fully vested in his Supplemental Retirement Benefit earned to date upon the occurrence of a Change in Control.

4.2 Forfeiture of Supplemental Retirement Benefit

A Participant who experiences a Separation from Service before becoming vested pursuant to Section 4.1, shall forfeit all rights to receive a Supplemental Retirement Benefit under the Plan; provided, however, that if the former Participant is reemployed by an Employer before the earlier to occur of (i) the date he attains age 55 and completes at least ten (10) Years of Service with under the Employers Qualified Plan and (ii) the date he attains age 65 and is again made a Participant in the Plan, his previously accrued benefit under the Plan shall be reinstated and shall be subject to his previous deferral elections, if any, except that no such reinstatement of his previously accrued benefit shall occur if the former Participant he was not fully vested under the Qualified Plan at the time of his Separation from Service.

4.3 Annuity Options

Before the beginning of the first year in which an Employee becomes a Participant in the Plan, or for a newly eligible Participant who is not eligible under any other excess benefit plan within the meaning of Treasury Regulation § 1.409A-2(a)(7)(iii), no later than thirty (30) days after the beginning of the calendar year immediately following the year in which he becomes a Participant, the Participant may elect to receive the Actuarial Equivalent of his vested Supplement Retirement Benefit in a single life annuity, 50% joint and survivor annuity or 75% joint and survivor annuity. To the extent a Member did not elect an annuity pursuant to this Section 4.3, his vested Supplemental Retirement Benefit shall be paid in a single lump sum amount.

Article V. Time of Payment

5.1 Default Time of Payment

To the extent a Member did not make an election pursuant to Section 5.2, his vested Supplemental Retirement Benefit shall be paid in a single lump sum amount or, in the case of a Member who elected an annuity pursuant to Section 4.3, shall commence to be paid as soon as administratively feasible, and in no event more than ninety (90) days, following the date of his Retirement.

5.2 Deferral Election

Before the beginning of the first year in which an Employee becomes a Participant in the Plan or, for a newly eligible Participant who is not eligible under any other excess benefit plan within the meaning of Treasury Regulation § 1.409A-2(a)(7)(iii), no later than thirty (30) days after the beginning of the calendar year immediately following the year in which he becomes a Participant, the Participant may elect to defer the payment, or the commencement of an annuity elected pursuant to Section 4.3, of his vested Supplemental Retirement Benefit until the later to occur of (i) the date the Participant experiences a Retirement and has attained at least age 55 and completed ten (10) Years of Service with the Employers and (ii) the date the Participant experiences a Retirement and has attained at least age 65. A deferral election made pursuant to

this Section 5.2 must be completed and signed by the Participant, timely delivered to the Plan Administrator and accepted by the Plan Administrator in order for such election to be valid.

5.3 Small Amount Cash-Outs

Notwithstanding anything herein to the contrary, in any case in which a Member’s vested Supplemental Retirement Benefit is $5,000 or less on the date of his Separation from Service, such benefit shall be paid in a single lump sum amount on the first day of the calendar month following the six-month anniversary of the date of the Member’s Separation from Service.

5.4 Distributions to Specified Employees

Notwithstanding any other provision of the Plan except Section 5.3, if a Participant is a Specified Employee on the date of his Separation from Service, then the payment of his vested Supplemental Retirement Benefit shall be made, or in the case of a Participant who elected an annuity pursuant to Section 4.3, shall commence, as soon as practicable, and in no event more than sixty (60) days, after the date that is six months after the date of the Participant’s Separation from Service or, if earlier, the date of his death; provided, however, that the payment of the vested Supplemental Retirement Benefit or the commencement of an annuity, to a Participant who made a deferral election pursuant to Section 5.2 shall be made pursuant to such election if the deferred payment or commencement date is later than the date that is six months after the date of the Participant’s Separation from Service.

Article VI. Spousal Benefit

6.1 Amount of Benefit

If a Member dies before his vested Supplemental Retirement Benefit is paid, or in the case of a Member who elected an annuity before the commencement of annuity payments, then the Member’s eligible spouse, if any, shall receive 50 percent of his vested Supplemental Retirement Benefit.

6.2 Payment of Spousal Benefit

The amount to be paid to a deceased Member’s spouse shall be paid as soon as administratively feasible, and in no event more than ninety (90) days, following the date of the Member’s death.

Article VII. Administration

7.1 Plan Administrator

The Committee shall be the Plan Administrator, responsible for the operation and administration of the Plan and for carrying out the provisions thereof. The Committee shall be the committee appointed by the Company as the Plan Administrator of the Qualified Plan, unless the Company otherwise elects. Any member of the Committee may resign at any time by giving ten (10) days’ prior written notice to the Company and the other members of the Committee. A Committee member who terminates employment with the Employers shall be deemed to have resigned from the Committee. The Company may at any time appoint a successor member or remove and

replace a member of the Committee, with or without cause, by providing ten (10) days’ prior written notice to him and the other members of the Committee. The Company may fill any vacancy in the membership of the Committee; provided, however, that if a vacancy reduces the membership of the Committee to less than three, such vacancy shall be filled as soon as practicable. The inability of a Committee member to vote on a decision specific to his Supplemental Retirement Benefit (as provided in Section 7.9) shall not be deemed a vacancy for purposes of this requirement. The Company shall give prompt written notice of any Committee vacancy to the other members of the Committee. Until any such vacancy is filled, the remaining members may exercise all of the powers, rights, and duties conferred on the Plan Administrator.

7.2 Plan Administrator’s Duties

In administering the Plan, the Plan Administrator shall have powers, rights, and duties similar to and consistent with the Plan Administrator’s duties set forth in the Qualified Plan.

7.3 Manner of Action

The Plan Administrator may act in any manner permitted of the Plan Administrator under the Qualified Plan.

7.4 Records

All resolutions, proceedings, acts, and determinations of the Committee shall be recorded, and all such records, together with such documents and instruments as may be necessary for the administration of the Plan, shall be preserved. All other Plan records shall be maintained by the Committee and shall accurately disclose the Supplement Retirement Benefit of each Member.

7.5 Information Required for Plan Administrator

The Employers shall furnish the Plan Administrator with such data and information as the Plan Administrator considers necessary or desirable to perform its duties with respect to Plan administration. The records of an Employer as to an Employee’s or Member’s period or periods of employment, termination of employment and the reason therefor, leaves of absence, reemployment, and compensation shall be conclusive on all persons unless determined to the Plan Administrator’s satisfaction to be incorrect. Members and other persons entitled to benefits under the Plan also shall furnish the Plan Administrator with such evidence, data or information as the Plan Administrator considers necessary or desirable for the Plan Administrator to perform its duties with respect to Plan administration.

7.6 Decision of Plan Administrator Final

Subject to applicable law and the provisions of Section 7.7, any interpretation of the provisions of the Plan and any decision on any matter within the discretion of the Plan Administrator, made by the Plan Administrator in good faith, shall be binding on all persons. A misstatement or other mistake of fact shall be corrected when it becomes known, and the Plan Administrator shall make such adjustment on account thereof as the Plan Administrator, in its sole discretion, considers equitable and practicable.

7.7 Review of Benefit Determinations

If a claim for benefits made by a Member, spouse of a deceased Member (or any other person claiming a right to a benefit under the Plan in respect of a Member or former Member) is denied, then the Plan Administrator shall, within ninety (90) days or one hundred-eighty (180) days if special circumstances require an extension of time after the claim is made, furnish the person making the claim with a written notice specifying the reasons for the denial. Such notice shall also refer to the pertinent Plan provisions on which the denial is based, describe any additional material or information necessary for properly completing the claim and explain why such material or information is necessary, and explain the Plan’s claim review procedures. If requested in writing, the Plan Administrator shall afford each claimant whose claim has been denied a full and fair review of the Plan Administrator’s decision and, within sixty (60) days, or one hundred-twenty (120) days if special circumstances require additional time of the request for reconsideration of the denied claim, the Plan Administrator shall notify the claimant in writing of the Plan Administrator’s final decision.

7.8 Uniform Rules

The Plan Administrator shall perform its duties with respect to Plan administration on a reasonable and nondiscriminatory basis and shall apply uniform rules to all Members similarly situated.

7.9 Interested Plan Administrator

Committee members may be Members, but no Committee member may decide or determine any matter or question concerning his specific benefits unless such decision or determination could be made by him under the Plan if he were not a Committee member.

7.10 Indemnification

To the extent permitted by law, no person (including the Employers, a trustee, any present or former Committee member, any agent of the Committee and any present or former director, officer, employee or agent of any Employer) shall be personally liable for any act done or omitted to be done in good faith in the administration of the Plan. To the extent permitted by law, each present or former director, officer, employee or agent of any Employer to whom the Plan Administrator or an Employer has delegated any portion of its responsibilities under the Plan and each present or former Committee member shall be indemnified and held harmless by the Employers (to the extent not indemnified or held harmless under any liability insurance or other indemnification arrangement with respect to the Plan) from and against any and all loss, cost, liability or expense that may be imposed upon or reasonably incurred by them in connection with or resulting from any claim, action, suit, or proceeding to which they may be a party or in which they may be involved by reason of any act done or omitted to be done in good faith in connection with the administration of the Plan, including all expenses reasonably incurred in their defense if the Employers fail to provide such defense.

7.11 Immunity of Committee Members

The members of the Committee may rely upon any information, report or opinion supplied to them by an officer of the Company or any legal counsel, independent public accountant, actuary or advisor and shall be fully protected in relying upon any such information, report or opinion. No member of the Committee shall have any liability to any Employer, Member or other person claiming under or through any Member or other person interested or concerned in connection with any decision made by such Member pursuant to the Plan which was based upon any such information, report or opinion if such member reasonably relied thereon in good faith.

7.12 No Enlargement of Employee Rights

Nothing contained in the Plan shall be deemed to give any Employee the right to be retained in the service of an Employer or to interfere with the right of an Employer to discharge or otherwise terminate the employment or change the terms of the employment or amount of compensation of any Participant at any time for any reason with or without cause. By accepting any payment under the Plan, each Member and each person claiming under or through such Member, shall be conclusively bound by any action or decision taken or made or to be taken or made under the Plan by the Plan Administrator.

7.13 Notice of Address and Missing Persons

Each person entitled to benefits under the Plan must file with the Plan Administrator, in writing, his post office address and each change of post office address. Any communication, statement, or notice addressed to such a person at his latest reported post office address shall be binding upon him for all purposes of the Plan, and the Plan Administrator and the Employers shall not be obliged to search for or ascertain his whereabouts. In the event that such person cannot be located, the Plan Administrator may direct that payment of such benefit with respect to such person shall be discontinued and all liability for the payment thereof shall terminate; provided, however, that in the event of the whereabouts of such person subsequently become known prior to the termination of the Plan, the benefits shall be paid in accordance with Articles IV and V.

Article VIII. Trust

The Company may in its sole discretion establish a trust for the purpose of administering assets of the Employers to be used for the purpose of satisfying their obligations under the Plan. Any such trust shall be established in such manner so as to be a grantor trust of which the Company is the grantor, within the meaning of Subpart E of Part I of Subchapter J of Chapter 1 of Subtitle A of the Code. The existence of any such trust shall not relieve any Employer of any liability under the Plan, but the obligations of the Employers shall be deemed satisfied to the extent paid from the trust.

Article IX. Miscellaneous

9.1 Amendment and Termination

(a) The Company does hereby expressly and specifically reserve the sole and exclusive right at any time by action of the Board to amend, modify, or terminate the Plan; provided, however, that the Plan shall be amended, modified or terminated only to the extent, and in the manner, permitted by section 409A of the Code.

(b) While the Company contemplates maintaining the Plan indefinitely, the Company shall not be under any obligation or liability whatsoever to maintain the Plan for any minimum or other period of time. In the event the Plan is terminated, the liquidation of vested Supplemental Retirement Benefit shall not be permitted unless the conditions of Treasury Regulation § 1.409A-3(j)(4)(ix) are satisfied.

9.2 Incompetency

Every person receiving or claiming benefits under the Plan shall be conclusively presumed to be mentally competent and of age until the Plan Administrator receives written notice, in a form and manner acceptable to it, that such person is incompetent or a minor, and that a guardian, conservator or other person legally vested with the care of such person’s estate has been appointed by a court of competent jurisdiction. In the event that the Plan Administrator finds that any person to whom a benefit is payable under the Plan is unable properly to care for such person’s affairs, or is a minor, then any payment due (unless a prior claim therefor shall have been made by a duly appointed legal representative) may be paid to a spouse, child, parent, brother, sister or any other person deemed by the Plan Administrator to have incurred expense for the person otherwise entitled to payment under the Plan.

In the event a guardian or conservator of the estate of any person receiving or claiming benefits under the Plan shall be appointed by a court of competent jurisdiction, payments shall be made to such guardian or conservator, provided, however, that proper proof of appointment is furnished in a form and manner acceptable to the Plan Administrator.

To the extent permitted by law, any payment made under the provisions of this Section 9.2 shall be a complete discharge of liability under the Plan.

9.3 Nonalienation

The benefits payable at any time under the Plan shall not be subject in any manner to alienation, sale, transfer, assignment (either at law or in equity), pledge, attachment, garnishment, any encumbrance of any kind or other legal or equitable process, except to the extent directly ordered by a court of law to comply with a domestic relations order. Any attempt to alienate, sell, transfer, assign, pledge or otherwise encumber any such benefit, whether presently or thereafter payable, shall be void. No benefit shall in any manner be liable for or subject to the debts or liabilities of any Member or of any other person entitled to any benefit.

The Plan Administrator may establish procedures for complying with domestic relations orders and, under such procedures, may distribute a Member’s Supplemental Retirement Benefit pursuant to the terms of a domestic relations order. A “domestic relations order” means any judgment, order or settlement which is made pursuant to a state domestic relations law and which relates to the provision of child support, alimony payments or marital property rights to a spouse, former spouse, child or other dependent.

9.4 Applicable law

The Plan and all rights hereunder and all determinations made and actions taken pursuant hereto shall be governed by and construed in accordance with the laws of the State of Delaware to the

extent such laws have not been preempted by federal law. All payments hereunder shall comply with the requirements of section 409A of the Code and the regulations promulgated thereunder.

9.5 Severability

If any provision of the Plan shall be held illegal or invalid for any reason, such illegality or invalidity shall not affect the remaining provisions of the Plan, and the Plan shall be construed and enforced as if the illegal or invalid provision had not been included in the Plan. The Company shall have the privilege and opportunity to correct and remedy any illegality or invalidity by amending the Plan pursuant to Section 9.1.

9.6 Notice

Any notice or filing required or permitted to be given to the Company under the Plan shall be sufficient if in writing and hand delivered or sent by registered or certified mail to the Corporate Secretary of the Company. Notice to the Corporate Secretary of the Company, if mailed, shall be addressed to the principal executive offices of the Company. Notice mailed to a Member shall be at such address reflected in the records of the Company. Notices shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification.

9.7 Costs of the Plan

All costs of implementing and administering the Plan shall be borne by the Employers as determined by the Company.

9.8 Successors

The Plan shall be binding on all persons entitled to benefits hereunder and their respective heirs and legal representatives, on the Committee and its successors, on the Employers and their successors, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business or assets of an Employer.

9.9 Subordination of Rights

At the Plan Administrator’s request, each Member or spouse of a deceased Member shall sign such documents as the Plan Administrator may require in order to subordinate such Member’s or spouse’s rights under the Plan to the rights of such other creditors of the Employers as may be specified by the Plan Administrator.

9.10 Counterparts

The Plan has been established by the Company and may be executed in any number of counterparts, each of which shall be considered as the original, and no requirements to produce another counterpart shall exist.

9.11 Taxes

Any Employer may withhold from a Member’s compensation and from any payment of a Supplemental Retirement Benefit any taxes that may be due with respect to such payment in such amount as the Company may reasonably estimate to be necessary to cover any taxes for which the Company or the Member’s current or former Employer, as the case may be, may be liable. If a Member’s Supplemental Retirement Benefit becomes taxable before the date on which such benefit is actually paid, the Member’s current or former Employer, as the case may be, shall remit any required withholding or employment taxes to the taxing authorities and shall correspondingly reduce the benefit payable under the Plan. If at any time the Plan is found to fail to meet the requirements of section 409A of the Code and the regulations thereunder, the Company may pay the amount required to be included in the Member’s income as a result of such failure. Any amount paid pursuant to this Section 9.11 shall be charged against the Member’s Supplemental Retirement Benefit and offset against future payments. A Member shall have no discretion, and shall have no direct or indirect election, as to whether a payment will be accelerated pursuant to this Section 9.11. Notwithstanding the foregoing, under no circumstances shall any Employer be responsible for any taxes, penalties, interest or other losses or expenses incurred by a Member due to any failure to comply with section 409A of the Code.

In Witness Whereof, AptarGroup, Inc. has caused this instrument to be executed by its duly authorized officers effective as of ___, 2008.

Exhibit 10.2

SEVERANCE AGREEMENT

THIS AGREEMENT is entered into as of July 14, 2004 by and between AptarGroup, Inc., a Delaware corporation (the “Company”), and Robert Kuhn (the “Executive”), is amended and restated as of July 18, 2008.

WHEREAS, the Executive currently serves as a key employee of the Company and his services and knowledge are valuable to the Company in connection with the management of one or more of the Company’s principal operating facilities, divisions, departments or subsidiaries; and

WHEREAS, the Board of Directors of the Company (the “Board”) has determined that it is in the best interests of the Company and its stockholders to secure the Executive’s continued services and to ensure the Executive’s continued dedication and objectivity in the event of any threat or occurrence of, or negotiation or other action that could lead to, or create the possibility of, a Change in Control (as defined in Section 1) of the Company, without concern as to whether the Executive might be hindered or distracted by personal uncertainties and risks created by any such possible Change in Control, and to encourage the Executive’s full attention and dedication to the Company, the Board has authorized the Company to enter into this Agreement.

NOW, THEREFORE, for and in consideration of the premises and the mutual covenants and agreements herein contained, the Company and the Executive hereby agree as follows:

1. Definitions . As used in this Agreement, the following terms shall have the respective meanings set forth below:

(a) “Cause” means: (1) a material breach by the Executive of those duties and responsibilities of the Executive which do not differ in any material respect from the duties and responsibilities of the Executive during the 90-day period immediately prior to a Change in Control (other than as a result of incapacity due to physical or mental illness) which is demonstrably willful and deliberate on the Executive’s part, which is committed in bad faith or without reasonable belief that such breach is in the best interests of the Company and which is not remedied in a reasonable period of time after receipt of written notice from the Company specifying such breach or (2) the commission by the Executive of a felony involving moral turpitude.

(b) “Change in Control” means:

(1) the acquisition by any individual, entity or group (a “Person”), including any “person” within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), of beneficial ownership within the meaning of Rule 13d-3 promulgated under the Exchange Act, of 30% or more of either (i) the then outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (ii) the combined voting power of the then outstanding securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided ,

however , that the following acquisitions shall not constitute a Change in Control: (A) any acquisition directly from the Company (excluding any acquisition resulting from the exercise of a conversion or exchange privilege in respect of outstanding convertible or exchangeable securities unless such outstanding convertible or exchangeable securities were acquired directly from the Company), (B) any acquisition by the Company, (C) any acquisition by an employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company or (D) any acquisition by any corporation pursuant to a reorganization, merger or consolidation involving the Company, if, immediately after such reorganization, merger or consolidation, each of the conditions described in clauses (i), (ii) and (iii) of subsection (3) of Section (1)(b) shall be satisfied; and provided further that, for purposes of clause (B), if any Person (other than the Company or any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company) shall become the beneficial owner of 30% or more of the Outstanding Company Common Stock or 30% or more of the Outstanding Company Voting Securities by reason of an acquisition by the Company and such Person shall, after such acquisition by the Company, become the beneficial owner of any additional shares of the Outstanding Company Common Stock or any additional Outstanding Company Voting Securities and such beneficial ownership is publicly announced, such additional beneficial ownership shall constitute a Change in Control;

(2) individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of such Board; provided , however , that any individual who becomes a director of the Company subsequent to the date hereof whose election, or nomination for election by the Company’s stockholders, was approved by the vote of at least a majority of the directors then comprising the Incumbent Board shall be deemed to have been a member of the Incumbent Board; and provided further , that no individual who was initially elected as a director of the Company as a result of an actual or threatened solicitation by a Person other than the Board for the purpose of opposing a solicitation by any other Person with respect to the election or removal of directors or any other actual or threatened solicitation of proxies or consents by or on behalf of any Person other than the Board shall be deemed to have been a member of the Incumbent Board;

(3) consummation of a reorganization, merger or consolidation unless, in any such case, immediately after such reorganization, merger or consolidation, (i) more than 60% of the then outstanding shares of common stock of the corporation resulting from such reorganization, merger or consolidation and more than 60% of the combined voting power of the then outstanding securities of such corporation entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals or entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such reorganization, merger or consolidation and in substantially the same proportions relative to each other as their ownership, immediately prior to such reorganization, merger or consolidation, of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as the case may be, (ii) no Person (other than the Company, any employee benefit plan (or related trust) sponsored or maintained by the Company or the corporation resulting from such reorganization, merger or consolidation (or any corporation controlled by the Company) and any Person which beneficially owned, immediately prior to such reorganization, merger or consolidation, directly or indirectly, 30% or more of the Outstanding Company Common Stock or the Outstanding Company Voting Securities, as the case may be) beneficially owns, directly

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or indirectly, 30% or more of the then outstanding shares of common stock of such corporation or 30% or more of the combined voting power of the then outstanding securities of such corporation entitled to vote generally in the election of directors and (iii) at least a majority of the members of the board of directors of the corporation resulting from such reorganization, merger or consolidation were members of the Incumbent Board at the time of the execution of the initial agreement or action of the Board providing for such reorganization, merger or consolidation; or

(4) consummation of (i) a plan of complete liquidation or dissolution of the Company or (ii) the sale or other disposition of all or substantially all of the assets of the Company other than to a corporation with respect to which, immediately after such sale or other disposition, (A) more than 60% of the then outstanding shares of common stock thereof and more than 60% of the combined voting power of the then outstanding securities thereof entitled to vote generally in the election of directors is then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and the Outstanding Company Voting Securities immediately prior to such sale or other disposition and in substantially the same proportions relative to each other as their ownership, immediately prior to such sale or other disposition, of the Outstanding Company Common Stock and the Outstanding Company Voting Securities, as the case may be, (B) no Person (other than the Company, any employee benefit plan (or related trust) sponsored or maintained by the Company or such corporation (or any corporation controlled by the Company) and any Person which beneficially owned, immediately prior to such sale or other disposition, directly or indirectly, 30% or more of the Outstanding Company Common Stock or the Outstanding Company Voting Securities, as the case may be) beneficially owns, directly or indirectly, 30% or more of the then outstanding shares of common stock thereof or 30% or more of the combined voting power of the then outstanding securities thereof entitled to vote generally in the election of directors and (C) at least a majority of the members of the board of directors thereof were members of the Incumbent Board at the time of the execution of the initial agreement or action of the Board providing for such sale or other disposition; provided, however, that no such transaction or event shall constitute a Change in Control unless it is also a “change in control event” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).

(c) “Date of Termination” means the date on which the Executive separates from service, within the meaning of Section 409A of the Code..

(d) “Good Reason” means, without the Executive’s express written consent, the occurrence of any of the following events after a Change in Control:

(1) a reduction by the Company in the Executive’s rate of annual salary in effect immediately prior to the Change in Control;

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(2) a material reduction in any benefit afforded to the Executive pursuant to any benefit plan of the Company in effect immediately prior to the Change in Control, unless all comparable executives of the Company suffer a substantially similar reduction; or

(3) the relocation of the Executive’s office to a location more than 60 miles from Crystal Lake, Illinois.

For purposes of this Agreement, any good faith determination of Good Reason made by the Executive shall be conclusive; provided , however , that an isolated, insubstantial and inadvertent action taken in good faith and which is remedied by the Company promptly after receipt of notice thereof given by the Executive shall not constitute Good Reason.

(e) “Nonqualifying Termination” means a termination of the Executive’s employment (1) by the Company for Cause, (2) by the Executive for any reason other than a Good Reason, (3) as a result of the Executive’s death or (4) by the Company due to the Executive’s absence from his duties with the Company on a full-time basis for at least 180 consecutive days as a result of the Executive’s incapacity due to physical or mental illness.

(f) “Termination Period” means the period of time beginning with a Change in Control and ending on the earliest to occur of (1) two years following such Change in Control and (2) the Executive’s death.

2. Obligations of the Executive . The Executive agrees that in the event any person or group attempts a Change in Control, he shall not voluntarily leave the employ of the Company without Good Reason (a) until such attempted Change in Control terminates or (b) if a Change in Control shall occur, until 90 days following such Change in Control. For purposes of clause (a) of the preceding sentence, Good Reason shall be determined as if a Change in Control had occurred when such attempted Change in Control became known to the Board.

3. Payments and Other Benefits Upon Termination of Employment .

(a) If during the Termination Period the employment of the Executive shall terminate, other than by reason of a Nonqualifying Termination, then the Company shall pay to the Executive (or the Executive’s beneficiary or estate) as compensation for services rendered to the Company:

(1) a cash amount equal to the sum of (i) the Executive’s annual bonus in an amount at least equal to the highest annualized (for any fiscal year consisting of less than 12 full months or with respect to which the Executive has been employed by the Company for less than 12 full months) bonus paid or payable, including by reason of any deferral, to the Executive by the Company and its affiliated companies in respect of the three fiscal years of the Company (or such portion thereof during which the Executive performed services for the Company if the Executive shall have been employed by the Company for less than such three fiscal year period) immediately preceding the fiscal year in which the Change in Control occurs, multiplied by a fraction, the numerator of which is the number of days in the fiscal year in which the termination occurs through the Date of Termination and the denominator of which is 365 or 366, as applicable, and (ii) any vacation pay, to the extent not theretofore paid; plus

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(2) a lump-sum cash amount (subject to any applicable payroll or other taxes required to be withheld) in an amount equal to (i) one (1) time the Executive’s highest annual base salary from the Company and its affiliated companies in effect during the 12-month period prior to the Date of Termination, plus (ii) one (1) time the Executive’s highest annualized (for any fiscal year consisting of less than 12 full months or with respect to which the Executive has been employed by the Company for less than 12 full months) bonus, paid or payable, including by reason of any deferral, to the Executive by the Company and its affiliated companies in respect of the three fiscal years of the Company (or such portion thereof during which the Executive performed services for the Company if the Executive shall have been employed by the Company for less than such three fiscal year period) immediately preceding the fiscal year in which the Change in Control occurs; provided , however , that any amount paid pursuant to this Section 3(a)(2) shall be paid in lieu of any other amount of severance relating to salary or bonus continuation to be received by the Executive upon termination of employment of the Executive under any severance plan, policy or arrangement of the Company; plus

(3) (i) Any unpaid salary accrued through the Date of Termination and (ii) in accordance with Section 14 hereof, any unpaid expenses which shall have been incurred as of the Date of Termination. The amounts payable to the Executive pursuant to this Section 3(a) shall be paid within 30 days following the Date of Termination, except as otherwise provided in Section 14 hereof.

(b) If, during the Termination Period, the employment of the Executive shall terminate, other than by reason of a Nonqualifying Termination, then the Executive shall be entitled, to the extent provided in any benefit plan in which the Executive has participated, to any plan benefits which by their terms extend beyond the Date of Termination. In addition thereto, in the event of such a termination, for a period of one year commencing on the Date of Termination, the Company shall continue to keep in full force and effect all policies of medical and life insurance with respect to the Executive and his dependents with the same level of coverage, upon the same terms and otherwise to the same extent as such policies shall have been in effect immediately prior to the Date of Termination or, if more favorable to the Executive, as provided generally with respect to other peer executives of the Company, and the Company and the Executive shall share the costs of the continuation of such insurance coverage in the same proportion as such costs were shared immediately prior to the Date of Termination.

(c) If during the Termination Period the employment of the Executive shall terminate by reason of a Nonqualifying Termination, then the Company shall pay to the Executive within 30 days following the Date of Termination, a cash amount equal to the sum of (1) the Executive’s salary from the Company and its affiliated companies through the Date of Termination, to the extent not theretofore paid, (2) any accrued vacation pay, to the extent not theretofore paid and (3) in accordance with Section 14 hereof, any unpaid expenses which shall have been incurred as of the Date of Termination. In addition, the Executive shall be entitled, to the extent provided in any benefit plan in which the Executive has participated, to any plan benefits which by their terms extend beyond the Date of Termination.

(d) If during the Termination Period the employment of the Executive shall terminate, whether or not by reason of a Nonqualifying Termination, the Company shall pay to the Executive any compensation previously deferred by the Executive (together with any interest

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and earnings thereon) in accordance with the terms of the plans pursuant to which such compensation was deferred.

4. Certain Additional Payments by The Company .

(a) Notwithstanding anything in this Agreement to the contrary, in the event it shall be determined that any payment or distribution by the Company or its affiliated companies to or for the benefit of the Executive (whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise, but determined without regard to any additional payments required under this Section 4) (a “Payment”) would be subject to the excise tax imposed by Section 4999 of the Code, or any interest or penalties are incurred by the Executive with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter collectively referred to as the “Excise Tax”), then the Executive shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after payment by the Executive of all taxes (including any interest or penalties imposed with respect to such taxes), including, without limitation, any income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. Notwithstanding the foregoing provisions of this Section 4(a), if it shall be determined that the Executive is entitled to a Gross-Up Payment, but that the Executive, after taking into account the Payments and the Gross-Up Payment, would not receive a net after-tax benefit of at least $50,000 (taking into account both income taxes and any Excise Tax) as compared to the net after-tax proceeds to the Executive resulting from an elimination of the Gross-Up Payment and a reduction of the Payments, in the aggregate, to an amount (the “Reduced Amount”) such that the receipt of Payments would not give rise to any Excise Tax, then no Gross-Up Payment shall be made to the Executive and the Payments, in the aggregate, shall be reduced to the Reduced Amount.

(b) Subject to the provisions of Section 4(c), all determinations required to be made under this Section 4, including whether and when a Gross-Up Payment is required and the amount of such Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be made by the Company’s public accounting firm (the “Accounting Firm”) which shall provide detailed supporting calculations both to the Company and the Executive within 15 business days of the receipt of notice from the Executive that there has been a Payment, or such earlier time as is requested by the Company. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity or group effecting the Change in Control, the Executive shall appoint another nationally recognized public accounting firm to make the determinations required hereunder (which accounting firm shall then be referred to as the Accounting Firm hereunder). All fees and expenses of the Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment, as determined pursuant to this Section 4 shall be paid by the Company to the Executive within five days of the receipt of the Accounting Firm’s determination, but in no event later than the last day of the calendar year following the calendar year in which the related tax is remitted to the Internal Revenue Service. If the Accounting Firm determines that no Excise Tax is payable by the Executive, it shall furnish the Executive with a written opinion that failure to report the Excise Tax on the Executive’s applicable federal income tax return would not result in the imposition of a negligence or similar penalty. Any determination by the Accounting Firm shall be binding upon the Company and the Executive. As a result of the uncertainty in the application of Section 4999 of the Code at the

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time of the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by the Company should have been made (“Underpayment”), consistent with the calculations required to be made hereunder. In the event that the Company exhausts its remedies pursuant to Section 4(c) and the Executive thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by the Company to or for the benefit of the Executive.

(c) The Executive shall notify the Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of the Gross-Up Payment. Such notification shall be given as soon as practicable but no later than 10 business days after the Executive is informed in writing of such claim and shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. The Executive shall not pay such claim prior to the expiration of the 30-day period following the date on which the Executive gives such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If the Company notifies the Executive in writing prior to the expiration of such period that it desires to contest such claim, the Executive shall:

(1) give the Company any information reasonably requested by the Company relating to such claim,

(2) take such action in connection with contesting such claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by the Company,

(3) cooperate with the Company in good faith in order effectively to contest such claim, and

(4) permit the Company to participate in any proceedings relating to such claim; provided , however , that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties with respect thereto) imposed as a result of such representation and payment of costs and expenses. Without limitation on the foregoing provisions of this Section 4(c) the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forgo any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct the Executive to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and the Executive agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company shall determine; provided further , that if the Company directs the Executive to pay such claim and sue for a refund, the Company shall advance the amount of such payment to the Executive on an interest-free basis and shall indemnify and hold the Executive harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or penalties with respect thereto) imposed with respect to such advance or with respect to any imputed income with respect to such advance; and provided further , that any extension of

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the statute of limitations relating to payment of taxes for the taxable year of the Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, the Company’s control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and the Executive shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority.

(d) If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 4(c), the Executive becomes entitled to receive, and receives, any refund with respect to such claim, the Executive shall (subject to the Company’s complying with the requirements of Section 4(c)) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 4(c), a determination is made that the Executive shall not be entitled to any refund with respect to such claim and the Company does not notify the Executive in writing of its intent to contest such denial of refund prior to the expiration of 30 days after such determination, then such advance shall be forgiven and shall not be required to be repaid and the amount of such advance shall offset, to the extent thereof, the amount of Gross-Up Payment required to be paid.

5. Withholding Taxes . The Company may withhold from all payments due to the Executive (or his beneficiary or estate) hereunder all taxes which, by applicable federal, state, local or other law, the Company is required to withhold therefrom.

6. Reimbursement of Expenses . If any contest or dispute shall arise under this Agreement involving termination of the Executive’s employment with the Company or involving the failure or refusal of the Company to perform fully in accordance with the terms hereof, the Company shall reimburse the Executive, on a current basis and in accordance with Section 14 hereof, for all legal fees and expenses, if any, incurred by the Executive in connection with such contest or dispute, together with interest in an amount equal to the Reference Rate of Bank of America from time to time in effect, but in no event higher than the maximum legal rate permissible under applicable law, such interest to accrue from the date the Company receives the Executive’s statement for such fees and expenses through the date of payment thereof; provided , however , that in the event the resolution of any such contest or dispute includes a finding denying, in total, the Executive’s claims in such contest or dispute, the Executive shall be required to reimburse the Company, over a period of 12 months from the date of such resolution, for all sums advanced to the Executive pursuant to this Section 6.

7. Operative Event . Notwithstanding any provision herein to the contrary, no amounts shall be payable hereunder unless and until there is a Change in Control at a time when the Executive is employed by the Company.

8. Termination of Agreement . (a) This Agreement shall be effective on the date hereof and shall continue until terminated by the Company as provided in paragraph (b) of this Section 8; provided , however , that this Agreement shall terminate in any event upon the first to occur of (i) the Executive’s death and (ii) termination of the Executive’s employment with the Company prior to a Change in Control.

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(b) The Company shall have the right prior to a Change in Control, in its sole discretion, pursuant to action by the Board, to approve the termination of this Agreement, which termination shall not become effective until the date fixed by the Board for such termination, which date shall be at least 120 days after notice thereof is given by the Company to the Executive in accordance with Section 11; provided , however , that no such action shall be taken by the Board during any period of time when the Board has knowledge that any person has taken steps reasonably calculated to effect a Change in Control until, in the opinion of the Board, such person has abandoned or terminated its efforts to effect a Change in Control; and provided further , that in no event shall this Agreement be terminated in the event of a Change in Control.

9. Scope of Agreement . Nothing in this Agreement shall be deemed to entitle the Executive to continued employment with the Company or its subsidiaries, and if the Executive’s employment with the Company shall terminate prior to a Change in Control, then the Executive shall have no further rights under this Agreement; provided , however , that any termination of the Executive’s employment following a Change in Control shall be subject to all of the provisions of this Agreement.

10. Successors; Binding Agreement .

(a) This Agreement shall not be terminated by any merger or consolidation of the Company whereby the Company is or is not the surviving or resulting corporation or as a result of any transfer of all or substantially all of the assets of the Company. In the event of any such merger, consolidation or transfer of assets, the provisions of this Agreement shall be binding upon the surviving or resulting corporation or the person or entity to which such assets are transferred.

(b) The Company agrees that concurrently with any merger, consolidation or transfer of assets referred to in paragraph (a) of this Section 10, it will cause any successor or transferee unconditionally to assume, by written instrument delivered to the Executive (or his beneficiary or estate), all of the obligations of the Company hereunder. Failure of the Company to obtain such assumption prior to the effectiveness of any such merger, consolidation or transfer of assets shall be a breach of this Agreement and if such merger, consolidation or transfer is a “change in control event,” within the meaning of Section 409A of the Code, the Executive shall be entitled to compensation and other benefits from the Company in the same amount and on the same terms as the Executive would be entitled hereunder if the Executive’s employment were terminated following a Change in Control other than by reason of a Nonqualifying Termination. For purposes of implementing the foregoing sentence, the date on which any such merger, consolidation or transfer becomes effective shall be deemed the Date of Termination.

(c) This Agreement shall inure to the benefit of and be enforceable by the Executive’s personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. If the Executive shall die while any amounts would be payable to the Executive hereunder had the Executive continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to such person or persons appointed in writing by the Executive to receive such amounts or, if no person is so appointed, to the Executive’s estate.

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11. Notices . (a) For purposes of this Agreement, all notices and other communications required or permitted hereunder shall be in writing and shall be deemed to have been duly given when delivered or five days after deposit in the United States mail, certified and return receipt requested, postage prepaid, addressed (1) if to the Executive, to Robert Kuhn, and if to the Company, to AptarGroup, Inc., 475 West Terra Cotta Avenue, Suite E, Crystal Lake, Illinois 60014, attention: Stephen J. Hagge, Executive Vice President, Chief Operating Officer, Chief Financial Officer, Secretary and Treasurer, or (2) to such other address as either party may have furnished to the other in writing in accordance herewith, except that notices of change of address shall be effective only upon receipt.

(b) A written notice of the Executive’s Date of Termination by the Company or the Executive, as the case may be, to the other, shall be required to be given and shall (i) indicate the specific termination provision in this Agreement relied upon, (ii) to the extent applicable, set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated and (iii) specify the Date of Termination (which date shall be not less than 15 days after the giving of such notice). The failure by the Executive or the Company to set forth in such notice any fact or circumstance which contributes to a showing of Good Reason or Cause shall not waive any right of the Executive or the Company hereunder or preclude the Executive or the Company from asserting such fact or circumstance in enforcing the Executive’s or the Company’s rights hereunder.

12. Full Settlement; Resolution of Disputes . (a) The Company’s obligation to make any payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Executive or others. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement and, such amounts shall not be reduced whether or not the Executive obtains other employment.

(b) If there shall be any dispute between the Company and the Executive in the event of any termination of the Executive’s employment, then, unless and until there is a final, nonappealable judgment by a court of competent jurisdiction declaring that such termination was for Cause, that the determination by the Executive of the existence of Good Reason was not made in good faith, or that the Company is not otherwise obligated to pay any amount or provide any benefit to the Executive and his dependents or other beneficiaries, as the case may be, under Section 3(a) or 3(b), the Company shall pay all amounts, and provide all benefits, to the Executive and his dependents or other beneficiaries, as the case may be, that the Company would be required to pay or provide pursuant to Section 3(a) or 3(b) as though such termination were by the Company without Cause or by the Executive with Good Reason; provided, however, that the Company shall not be required to pay any disputed amounts pursuant to this Section 12(b) except upon receipt of an undertaking by or on behalf of the Executive to repay all such amounts to which the Executive is ultimately adjudged by such court not to be entitled.

13. Employment with Subsidiaries . Employment with the Company for purposes of this Agreement shall include employment with any corporation or other entity in

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which the Company has a direct or indirect ownership interest of 50% or more of the total combined voting power of the then outstanding securities of such corporation or other entity entitled to vote generally in the election of directors.

14. Section 409A. This Agreement shall be interpreted and construed in a manner that avoids the imposition of taxes and penalties under Section 409A of the Code (“409A Penalties”). In the event the terms of this Agreement would subject the Executive to 409A Penalties, the Company and the Executive shall cooperate diligently to amend the terms of the Agreement to avoid such 409A Penalties, to the extent possible. Notwithstanding any other provision in this Agreement, if on the Date of Termination, the Executive is a “specified employee,” as defined in Section 409A of the Code, then to the extent any amount payable under this Agreement constitutes the payment of nonqualified deferred compensation, within the meaning of Section 409A of the Code, that under the terms of this Agreement would be payable prior to the six-month anniversary of the Date of Termination, such payment shall be delayed until the earlier to occur of (a) the six-month anniversary of the Date of Termination or (b) the date of the Executive’s death. Any reimbursement (including any advancement) payable to the Executive pursuant to this Agreement shall be conditioned on the submission by the Executive of all expense reports reasonably required by the Company under any applicable expense reimbursement policy, and shall be paid to the Executive within 30 days following receipt of such expense reports (or invoices), but in no event later than the last day of the calendar year following the calendar year in which the Executive incurred the reimbursable expense. Any amount of expenses eligible for reimbursement or any in-kind benefit provided during a calendar year shall not affect the amount of expenses eligible for reimbursement or in-kind benefit provided during any other calendar year. The right to reimbursement or an in-kind benefit pursuant to this Agreement shall not be subject to liquidation or exchange for any other benefit.

15. Governing Law; Validity . The interpretation, construction and performance of this Agreement shall be governed by and construed and enforced in accordance with the internal laws of the State of Illinois without regard to the principle of conflicts of laws. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which other provisions shall remain in full force and effect.

16. Counterparts . This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original and all of which together shall constitute one and the same instrument.

17. Miscellaneous . No provision of this Agreement may be modified or waived unless such modification or waiver is agreed to in writing and signed by the Executive and by a duly authorized officer of the Company. No waiver by either party hereto at any time

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of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. Failure by the Executive or the Company to insist upon strict compliance with any provision of this Agreement or to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement. The rights of, and benefits payable to, the Executive, his estate or his beneficiaries pursuant to this Agreement are in addition to any rights of, or benefits payable to, the Executive, his estate or his beneficiaries under any other employee benefit plan or compensation program of the Company.

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by a duly authorized officer of the

Company and the Executive has executed this Agreement as of the day and year first above written.


	APTARGROUP, INC.
	By:	\s\ Peter Pfeiffer
	Name: Peter Pfeiffer
	Title: President and Chief Executive Officer


		EXECUTIVE

		\s\ Robert Kuhn
		Robert Kuhn

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Exhibit 31.1

CERTIFICATION

I, Peter H. Pfeiffer, 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 quarterly 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 we 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 that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

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:

	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:		November 4, 2008

		By:		/s/ Peter H. Pfeiffer
				Peter H. Pfeiffer
				President and Chief Executive Officer

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 quarterly 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 we 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 that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

	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:		November 4, 2008

		By:		/s/ Robert W. Kuhn
				Robert W. Kuhn
				Executive Vice President and
				Chief Financial Officer

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, Peter H. Pfeiffer, 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 September 30, 2008 (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.


		/s/ Peter H. Pfeiffer
		Peter H. Pfeiffer
		President and Chief Executive Officer

		November 4, 2008

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 of AptarGroup, Inc., certify that (i) the Quarterly Report on Form 10-Q of AptarGroup, Inc. for the quarter ended September 30, 2008 (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 and Chief Financial Officer
		November 4, 2008

AptarGroup, Inc.

\s\Stephan J. Hagge

Executive VP and Chief Operating Officer