United States
Securities and Exchange Commission
Washington, D.C. 20549
FORM 11-K
---------------------------
(Mark one)
[X] ANNUAL REPORT PURSUANT TO SECTION 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2003
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from______________ to _____________
Commission file number 1-12981
---------------------------
AMETEK 401(K) PLAN FOR ACQUIRED BUSINESSES
(Full title of the plan)
AMETEK, INC.
37 NORTH VALLEY ROAD, BUILDING 4, P.O. BOX 1764
PAOLI, PENNSYLVANIA 19301-0801
(Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office)
AMETEK 401(K) Plan for Acquired Businesses
Financial Statements and Supplemental Schedule
Years ended December 31, 2003 and 2002
CONTENTS
Report of Independent Registered Public Accounting Firm.................................... 2
Audited Financial Statements:
Statements of Assets Available for Benefits................................................ 3
Statements of Changes in Assets Available for Benefits..................................... 4
Notes to Financial Statements.............................................................. 5
Supplemental Schedule:
Schedule H, Line 4i Schedule of Assets (Held at End of Year).............................. 12
Signatures................................................................................. 13
Exhibit Index.............................................................................. 14
1
Report of Independent Registered Public Accounting Firm
Plan Administrative Committee
AMETEK 401(K) Plan for Acquired Businesses
We have audited the accompanying statements of assets available for benefits of
the AMETEK 401(K) Plan for Acquired Businesses (the Plan) as of December 31,
2003 and 2002, and the related statements of changes in assets available for
benefits for the years then ended. These financial statements and schedule are
the responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the assets available for benefits of the Plan at December
31, 2003 and 2002, and the changes in its assets available for benefits for the
years then ended, in conformity with U.S. generally accepted accounting
principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying schedule of assets (held
at end of year) as of December 31, 2003, is presented for purposes of additional
analysis and is not a required part of the financial statements but is
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. This supplemental schedule is the responsibility of the
Plan's management. The supplemental schedule has been subjected to the auditing
procedures applied in our audits of the financial statements and, in our
opinion, is fairly stated in all material respects in relation to the financial
statements taken as a whole.
/s/ Ernst & Young LLP
Philadelphia, Pennsylvania
June 9, 2004
2
AMETEK 401(K) Plan for Acquired Businesses
Statements of Assets Available for Benefits
DECEMBER 31,
2003 2002
----------- -----------
ASSETS:
Investments, at fair value $39,546,758 $33,370,031
----------- -----------
Receivables:
Employer contributions - 106,535
Participants contributions - 220,313
----------- -----------
Total receivables - 326,848
----------- -----------
Assets available for benefits $39,546,758 $33,696,879
=========== ===========
See accompanying notes.
3
AMETEK 401(K) Plan for Acquired Businesses
Statements of Changes in Assets Available for Benefits
YEAR ENDED DECEMBER 31,
2003 2002
------------ ------------
ADDITIONS (REDUCTIONS):
Contributions:
Employer $ 1,165,231 $ 1,581,183
Participants 2,382,502 3,049,036
Participant rollovers from other plans 88,181 188,009
------------ ------------
3,635,914 4,818,228
Investment income (loss):
Net appreciation (depreciation) in fair value of investments 6,745,795 (5,755,706)
Interest and dividend income 727,913 812,896
------------ ------------
7,473,708 (4,942,810)
------------ ------------
Total additions (reductions) 11,109,622 (124,582)
------------ ------------
DEDUCTIONS:
Benefits paid to participants 5,259,743 5,132,003
------------ ------------
Total deductions 5,259,743 5,132,003
------------ ------------
Net increase (decrease) 5,849,879 (5,256,585)
Assets available for benefits:
Beginning of year 33,696,879 38,953,464
------------ ------------
End of year $ 39,546,758 $ 33,696,879
============ ============
See accompanying notes.
4
AMETEK 401(K) Plan for Acquired Businesses
Notes to Financial Statements
December 31, 2003
1. DESCRIPTION OF PLAN
GENERAL
The following brief description of the AMETEK 401(K) Plan for Acquired
Businesses ("the Plan") provides only summarized information. Participants
should refer to the Plan document for a more complete description of the Plan's
provisions.
The Plan is a tax-deferred 401(k) defined contribution savings plan. The Plan
provides eligible employees of businesses acquired by AMETEK, Inc. ("AMETEK", or
"the Company"), an opportunity to invest a portion of their compensation, as
defined by the Plan, in one or a combination of investment programs (see Note
3).
CONTRIBUTIONS
Each year, participants have an opportunity to invest up to 50% (14% prior to
July 1, 2002) of their annual compensation, as defined by the Plan, in multiples
of one percent, except for certain highly compensated participants who may be
subject to certain regulatory limitations. Beginning January 1, 2004, certain
groups of participants will have an opportunity to invest up to 75% of their
compensation, as defined by the Plan. Participants may also contribute amounts
representing rollovers from other qualified plans. Also in connection with
business acquisitions by AMETEK, account balances from certain other plans may
be transferred into the Plan. The Plan provides for Company contributions equal
to 100% of the amount contributed by each participant, up to a maximum
percentage ranging from 2% to 6% of the participants' compensation as determined
by the Board of Directors for each business. Matching Company contributions are
credited to participants' accounts at the same time their contributed
compensation is invested. However, the Company may make its matching
contribution payment to the Plan at anytime prior to the due date prescribed by
law for filing the Company's federal income tax return for that Plan year.
PARTICIPANT ACCOUNTS
Each participant's account is credited with the participant's contributions and
allocations of (a) the Company's contributions and (b) Plan net earnings.
Allocations are based on participant earnings and/or account balances, as
defined. The benefit to which a participant is entitled is the balance in the
participant's account.
VESTING
Participants are fully vested at all times in both their contributions to the
Plan and in Company contributions.
5
AMETEK 401(K) Plan for Acquired Businesses
Notes to Financial Statements
December 31, 2003
1. DESCRIPTION OF PLAN (CONTINUED)
PARTICIPANT LOANS
Participants may borrow a minimum of $1,000 or up to a maximum equal to the
lesser of $50,000 or 50% of their account balance. Participants may have up to
two loans outstanding at any time, the sum of which may not exceed the maximum
allowable. Repayment terms of the loans are generally limited to no longer than
60 months from inception or for a reasonable period of time in excess of 60
months for the purchase of a principal residence, as fixed by the Plan's
Administrative Committee. The loans are secured by the balance in the
participant's account, and bear interest at rates established by the Plan's
administrative committee, which approximate rates charged by commercial lending
institutions for comparable loans. Interest rates on loans outstanding at
December 31, 2003 ranged between 5% and 11.5%. Principal and interest is paid
ratably through payroll deductions.
PAYMENT OF BENEFITS
On termination of service, death, disability or retirement, a participant may
receive a lump-sum amount equal to his or her vested account or elect to receive
payment in installments up to a 15 year period, subject to certain restrictions
based on life expectancy. Participants with a vested account value of less than
$5,000 will be paid in a lump sum as soon as practicable after retirement,
termination, disability or death of the participant. When a participant attains
age 59-1/2 while still an employee, he or she can elect to withdraw a specified
portion of his or her vested account balance. Also, in certain cases of
financial hardship, a participant may elect to withdraw up to a specified
portion of his or her vested account balance, regardless of age.
PLAN TERMINATION
The Plan is subject to the provisions of the Employee Retirement Income Security
Act of 1974 ("ERISA").
While the Company has not expressed any intent to terminate the Plan, it is free
to do so at any time subject to the provisions of ERISA, and applicable labor
agreements. In the event of Plan termination, each participant will receive the
value of his or her separate vested account.
6
AMETEK 401(K) Plan for Acquired Businesses
Notes to Financial Statements
December 31, 2003
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF FINANCIAL STATEMENTS AND PRESENTATION FORMAT
The accompanying financial statements have been prepared on the accrual basis of
accounting, except for the non-accrual of a liability for amounts owed to
withdrawing participants, which are reflected in plan equity in accordance with
U.S. generally accepted accounting principles (see Note 6). The accompanying
financial statements have been prepared in accordance with Statement of Position
(SOP) 99-3, "Accounting for and Reporting of Certain Defined Contribution
Benefit Plan Investments and Other Disclosure Matters."
USE OF ESTIMATES
The preparation of financial statements in conformity with U.S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates and
assumptions.
RISKS AND UNCERTAINTIES
The Plan invests in various investment securities. Investment securities are
exposed to various risks such as interest rate, market fluctuation and credit
risks. Due to the level of risk associated with certain investment securities,
it is at least reasonably possible that changes in the values of investment
securities will occur in the near term and that such changes could materially
affect participants' account balances and the amounts reported in the statements
of net assets available for benefits.
INVESTMENT VALUATION AND INCOME RECOGNITION
The shares of registered investment companies are valued at quoted market
prices, which represent the net asset values of shares held by the Plan at
year-end. The fair value of the participation units in the common/collective
trust is based on quoted redemption values on the last business day of the plan
year. Money market and short-term investments are carried at the fair value
established by the issuer and/or the trustee. The participant loans are valued
at their outstanding balances, which approximates fair value.
7
AMETEK 401(K) Plan for Acquired Businesses
Notes to Financial Statements
December 31, 2003
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Purchases and sales of investments are reflected on trade dates. Realized gains
and losses on sales of investments are based on the average cost of such
investments. Interest income is recorded on the accrual basis. Dividend income
is recorded on the ex-dividend date. Income from other investments is recorded
as earned.
The net appreciation or depreciation of investments represents the sum of the
change in the difference between year-end market value and cost of investments,
and the difference between the proceeds received and the cost of investments
sold during the year.
3. INVESTMENT PROGRAMS
At December 31, 2003 and 2002, the Vanguard Fiduciary Trust Company was the
Trustee and a party-in-interest of the Plan.
A participant may direct contributions (up to certain specified limits) in any
of the following investment options.
- AMETEK Stock Fund
- Vanguard Retirement Savings Master Trust
Registered investment companies:
- Vanguard Prime Money Market Fund
- Vanguard Total Bond Market Index Fund
- Vanguard LifeStrategy Funds
- Vanguard Wellington Fund
- Vanguard Windsor II Fund
- Vanguard PRIMECAP Fund
- Vanguard International Growth Fund
- Vanguard Small-Cap Index Fund
- Vanguard 500 Index Fund
- Fidelity Magellan Fund
- BlackRock Small Cap. Fund
Participants may change their investment options or transfer existing account
balances to other investment options daily.
8
AMETEK 401(K) Plan for Acquired Businesses
Notes to Financial Statements
December 31, 2003
3. INVESTMENT PROGRAMS (CONTINUED)
The fair value of individual investments that represent 5% or more of the Plan's
assets at year-end are as follows:
DECEMBER 31,
2003 2002
---------- ----------
Vanguard Retirement Savings Master Trust $2,309,734 $2,313,938
Vanguard Prime Money Market Fund 2,363,644 2,867,625
Vanguard Total Bond Market Index Fund 2,029,186 2,168,318
Vanguard LifeStrategy Growth Fund 2,606,219 2,044,346
Vanguard LifeStrategy Moderate Growth Fund 4,456,703 3,692,837
Vanguard Wellington Fund 2,780,760 2,383,499
Vanguard PRIMECAP Fund 7,672,795 5,102,774
Vanguard 500 Index Fund 5,571,749 4,486,595
During 2003 and 2002 the Plan's investments (including gains and losses on
investments bought, sold, as well as held during the year) appreciated
(depreciated) in value as follows:
DECEMBER 31,
2003 2002
---------- -----------
Common Stock $ 249,045 $ 191,889
Registered investment companies 6,496,750 (5,947,595)
---------- -----------
$6,745,795 ($5,755,706)
========== ===========
9
AMETEK 401(K) Plan for Acquired Businesses
Notes to Financial Statements
December 31, 2003
4. INCOME TAX STATUS
The Plan has received a determination letter from the Internal Revenue Service
dated October 24, 2002, stating that the Plan is qualified under Section 401(a)
of the Internal Revenue Code (the "Code") and, therefore, the related trust is
exempt from taxation. Subsequent to issuance of the above determination letter,
the Plan was amended and restated. Once qualified, the Plan is required to
operate in conformity with the Code to maintain its qualification. The plan
administrator believes the Plan is being operated in compliance with the
applicable requirements of the Code and, therefore, believes that the Plan, as
amended and restated, continues to be qualified and the related trust is tax
exempt.
5. ADMINISTRATIVE EXPENSES
The expenses of administering the Plan are payable from the trust funds, unless
the Company elects to pay such expenses. From inception of the Plan to the
present, the Company elected to pay such expenses directly.
6. DIFFERENCES BETWEEN FINANCIAL STATEMENTS AND FORM 5500
The following is a reconciliation of assets available for benefits per the
financial statements to the Plan's Form 5500:
DECEMBER 31,
2003 2002
----------- -----------
Assets available for benefits per the
financial statements $39,546,758 $33,696,879
Amounts owed to withdrawing participants (64,415) (160,574)
----------- -----------
Assets available for benefits per Form 5500 $39,482,343 $33,536,305
=========== ===========
10
AMETEK 401(K) Plan for Acquired Businesses
Notes to Financial Statements
December 31, 2003
6. DIFFERENCES BETWEEN FINANCIAL STATEMENTS AND FORM 5500 (CONTINUED)
The following is a reconciliation of benefits paid to participants for the year
ended December 31, 2002 per the financial statements to the Form 5500:
YEAR ENDED
DECEMBER 31,
2003
----------
Benefits paid to participants per the financial statements $5,259,743
Add: Amounts allocated to withdrawing participants at December 31,
2003 64,415
Less: Amounts allocated to withdrawing participants at December 31,
2002 (160,574)
----------
Benefits paid to participants per Form 5500 $5,163,584
==========
Amounts allocated to withdrawing participants are recorded on the Plan's Form
5500 for benefit claims that have been processed and approved for payment prior
to December 31 but not yet paid as of that date.
11
AMETEK 401(K) Plan for Acquired Businesses
Form 5500, Schedule H, Line 4i --
Schedule of Assets (Held at End of Year)
December 31, 2003
DESCRIPTION OF INVESTMENT, INCLUDING MATURITY
IDENTITY OF ISSUE, BORROWER, LESSOR, OR DATE, RATE OF INTEREST, COLLATERAL, PAR, OR CURRENT
SIMILAR PARTY MATURITY VALUE VALUE
AMETEK Stock Fund* Common Stock Fund $ 1,192,994
Vanguard Retirement Savings Master Trust* Common/Collective Trust 2,309,734
Vanguard Prime Money Market Fund* Registered Investment Company 2,363,644
Vanguard Total Bond Market Index Fund* Registered Investment Company 2,029,186
Vanguard LifeStrategy Conservative Growth Fund* Registered Investment Company 1,020,103
Vanguard LifeStrategy Growth Fund* Registered Investment Company 2,606,219
Vanguard LifeStrategy Moderate Growth Fund* Registered Investment Company 4,456,703
Vanguard Wellington Fund* Registered Investment Company 2,780,760
Vanguard Windsor II Fund* Registered Investment Company 1,840,377
Vanguard PRIMECAP Fund* Registered Investment Company 7,672,795
Vanguard International Growth Fund* Registered Investment Company 810,717
Vanguard Small-Cap Index Fund* Registered Investment Company 1,096,382
Vanguard 500 Index Fund* Registered Investment Company 5,571,749
Fidelity Magellan Fund Registered Investment Company 1,605,637
BlackRock Small Cap. Fund Registered Investment Company 907,737
Participant Loans* Interest rates ranging
From 5.0% to 11.5% 1,282,021
-----------
$39,546,758
===========
* Indicates party-in-interest to the Plan
12
SIGNATURES
THE PLAN. Pursuant to the requirements of the Securities Exchange Act of 1934,
the Members of the Administrative Committee have duly caused this annual report
to be signed on its behalf by the undersigned hereunto duly authorized.
AMETEK 401(K) Plan
for Acquired Businesses
------------------------------
(Name of Plan)
Dated: June 23, 2004 By: /s/ John J. Molinelli
----------------------------------------
John J. Molinelli, Member,
Administrative Committee
13
THE AMETEK 401(K) PLAN FOR ACQUIRED BUSINESSES
EXHIBIT INDEX
Exhibit Number Description
-------------- -----------
23 Consent of Independent Auditors
14