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, 2001 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 The AMETEK Retirement and Savings Plan (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)
Report of Independent Auditors The Administrative Committee AMETEK Retirement and Savings Plan We have audited the accompanying statements of financial condition of the AMETEK Retirement and Savings Plan as of December 31, 2001 and 2000, and the related statements of income and changes in plan equity for each of the three years in the period ended December 31, 2001. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the 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 financial condition of the AMETEK Retirement and Savings Plan at December 31, 2001 and 2000, and the income and changes in plan equity for each of the three years in the period ended December 31, 2001, in conformity with accounting principles generally accepted in the United States. /s/ Ernst & Young LLP Philadelphia, Pennsylvania June 7, 2002 F-1
THE AMETEK RETIREMENT AND SAVINGS PLAN STATEMENT OF FINANCIAL CONDITION DECEMBER 31, 2001 FIXED INCOME BALANCED EQUITY FUND FUND FUND ASSETS Investments at fair value: Guaranteed Investment Contracts $ 39,407,287 $ -- $ -- Vanguard Group of Mutual Funds 9,237,690 15,224,333 47,239,895 Fidelity Magellan Fund -- -- 18,336,170 BlackRock Small Cap Fund -- -- 9,988,373 Cash value of life insurance -- -- -- AMETEK, Inc. common stock -- -- -- Loans to participants -- -- -- ------------ ------------ ------------ Total Investments 48,644,977 15,224,333 75,564,438 Receivables: Employee contributions 265,160 158,793 603,315 Employer contributions 79,646 67,294 189,388 Interfund accounts 113,734 26,270 157,312 ------------ ------------ ------------ Total Assets $ 49,103,517 $ 15,476,690 $ 76,514,453 ============ ============ ============ LIABILITIES AND PLAN EQUITY Liability for Insurance Contribution $ -- $ -- $ -- ------------ ------------ ------------ Total Liabilities -- -- -- Plan equity 49,103,517 15,476,690 76,514,453 ------------ ------------ ------------ Total liabilities and plan equity $ 49,103,517 $ 15,476,690 $ 76,514,453 ============ ============ ============ COMMON INSURANCE STOCK LOAN TOTAL CONTRACTS FUND ACCOUNT ASSETS Investments at fair value: Guaranteed Investment Contracts $ -- $ -- $ -- $ 39,407,287 Vanguard Group of Mutual Funds -- -- -- 71,701,918 Fidelity Magellan Fund -- -- -- 18,336,170 BlackRock Small Cap Fund -- -- -- 9,988,373 Cash value of life insurance 395,830 -- -- 395,830 AMETEK, Inc. common stock -- 10,163,534 -- 10,163,534 Loans to participants -- -- 5,526,451 5,526,451 ------------ ------------ ------------ ------------ Total Investments 395,830 10,163,534 5,526,451 155,519,563 Receivables: Employee contributions 2,174 44,680 -- 1,074,122 Employer contributions -- 16,345 -- 352,673 Interfund accounts -- 13,780 (311,096) -- ------------ ------------ ------------ ------------ Total Assets $ 398,004 $ 10,238,339 $ 5,215,355 $156,946,358 LIABILITIES AND PLAN EQUITY Liability for Insurance Contribution $ 2,174 $ -- $ -- $ 2,174 ------------ ------------ ------------ ------------ Total Liabilities 2,174 -- -- 2,174 Plan equity 395,830 10,238,339 5,215,355 156,944,184 ------------ ------------ ------------ ------------ Total liabilities and plan equity $ 398,004 $ 10,238,339 $ 5,215,355 $156,946,358 ============ ============ ============ ============ See accompanying notes. F-2
THE AMETEK RETIREMENT AND SAVINGS PLAN STATEMENT OF FINANCIAL CONDITION DECEMBER 31, 2000 FIXED INCOME BALANCED EQUITY FUND FUND FUND ASSETS Investments at fair value: Guaranteed Investment Contracts $ 38,731,332 $ -- $ -- Vanguard Group of Mutual Funds 8,011,422 13,517,248 50,583,095 Fidelity Magellan Fund -- -- 20,267,830 BlackRock Small Cap Fund -- -- 15,377,629 Cash value of life insurance -- -- -- AMETEK, Inc. common stock -- -- -- Loans to participants -- -- -- ------------ ------------ ------------ Total Investments 46,742,754 13,517,248 86,228,554 Receivables: Employee contributions 125,665 65,212 311,166 Employer contributions 56,032 54,344 172,408 Interfund accounts 53,125 10,512 69,654 ------------ ------------ ------------ Total Assets $ 46,977,576 $ 13,647,316 $ 86,781,782 ============ ============ ============ LIABILITIES AND PLAN EQUITY Liability for Insurance Contribution $ -- $ -- $ -- ------------ ------------ ------------ Total Liabilities -- -- -- Plan equity 46,977,576 13,647,316 86,781,782 ------------ ------------ ------------ Total liabilities and plan equity $ 46,977,576 $ 13,647,316 $ 86,781,782 ============ ============ ============ COMMON INSURANCE STOCK LOAN TOTAL CONTRACTS FUND ACCOUNT ASSETS Investments at fair value: Guaranteed Investment Contracts $ -- $ -- $ -- $ 38,731,332 Vanguard Group of Mutual Funds -- -- -- 72,111,765 Fidelity Magellan Fund -- -- -- 20,267,830 BlackRock Small Cap Fund -- -- -- 15,377,629 Cash value of life insurance 421,067 -- -- 421,067 AMETEK, Inc. common stock -- 8,734,662 -- 8,734,662 Loans to participants -- -- 6,068,270 6,068,270 ------------ ------------ ------------ ------------ Total Investments 421,067 8,734,662 $ 6,068,270 161,712,555 Receivables: Employee contributions 1,243 22,161 -- 525,447 Employer contributions -- 15,143 -- 297,927 Interfund accounts -- 7,263 (140,554) -- ------------ ------------ ------------ ------------ Total Assets $ 422,310 $ 8,779,229 $ 5,927,716 $162,535,929 ============ ============ ============ ============ LIABILITIES AND PLAN EQUITY Liability for Insurance Contribution $ 1,243 $ -- $ -- $ 1,243 ------------ ------------ ------------ ------------ Total Liabilities 1,243 -- -- 1,243 Plan equity 421,067 8,779,229 5,927,716 162,534,686 ------------ ------------ ------------ ------------ Total liabilities and plan equity $ 422,310 $ 8,779,229 $ 5,927,716 $162,535,929 ============ ============ ============ ============ See accompanying notes. F-3
THE AMETEK RETIREMENT AND SAVINGS PLAN STATEMENT OF INCOME AND CHANGES IN PLAN EQUITY YEAR ENDED DECEMBER 31, 2001 FIXED INCOME BALANCED EQUITY FUND FUND FUND ADDITIONS Contributions: Employee $ 2,716,867 $ 1,470,700 $ 6,468,643 Employer 932,727 832,232 2,547,521 Rollovers from other plans 246,317 212,292 425,354 ------------- ------------- ------------- Total Contributions 3,895,911 2,515,224 9,441,518 ------------- ------------- ------------- Investment Income: Interest and dividends 2,670,934 861,920 1,117,207 Net realized and unrealized gain (loss) on investments 27,231 (760,157) (14,223,828) ------------- ------------- ------------- Total Investment Income (Loss) 2,698,165 101,763 (13,106,621) ------------- ------------- ------------- Total Contributions and ------------- ------------- ------------- Investment Income (Loss) 6,594,076 2,616,987 (3,665,103) ------------- ------------- ------------- DEDUCTIONS Withdrawals and terminations (6,620,524) (806,777) (5,276,619) Insurance premiums and commissions - net -- -- -- Net interfund transfers 2,152,389 19,164 (1,325,607) ------------- ------------- ------------- Total Deductions (4,468,135) (787,613) (6,602,226) ------------- ------------- ------------- Increase (decrease) in plan equity 2,125,941 1,829,374 (10,267,329) Plan equity at beginning of year 46,977,576 13,647,316 86,781,782 ------------- ------------- ------------- Plan equity at end of year $ 49,103,517 $ 15,476,690 $ 76,514,453 ============= ============= ============= COMMON INSURANCE STOCK LOAN TOTAL CONTRACTS FUND ACCOUNT ADDITIONS Contributions: Employee $ 26,715 $ 481,152 $ -- $ 11,164,077 Employer -- 225,771 -- 4,538,251 Rollovers from other plans -- 26,582 -- 910,545 ------------- ------------- ------------- ------------- Total Contributions 26,715 733,505 -- 16,612,873 ------------- ------------- ------------- ------------- Investment Income: Interest and dividends 31,858 53,398 497,448 5,232,765 Net realized and unrealized gain (loss) on investments -- 1,958,283 -- (12,998,471) ------------- ------------- ------------- ------------- Total Investment Income (Loss) 31,858 2,011,681 497,448 (7,765,706) ------------- ------------- ------------- ------------- Total Contributions and ------------- ------------- ------------- ------------- Investment Income (Loss) 58,573 2,745,186 497,448 8,847,167 ------------- ------------- ------------- ------------- DEDUCTIONS Withdrawals and terminations (57,095) (651,622) (998,317) (14,410,954) Insurance premiums and commissions - net (26,715) -- -- (26,715) Net interfund transfers -- (634,454) (211,492) -- ------------- ------------- ------------- ------------- Total Deductions (83,810) (1,286,076) (1,209,809) (14,437,669) ------------- ------------- ------------- ------------- Increase (decrease) in plan equity (25,237) 1,459,110 (712,361) (5,590,502) Plan equity at beginning of year 421,067 8,779,229 5,927,716 162,534,686 ------------- ------------- ------------- ------------- Plan equity at end of year $ 395,830 $ 10,238,339 $ 5,215,355 $ 156,944,184 ============= ============= ============= ============= See accompanying notes. F-4
THE AMETEK RETIREMENT AND SAVINGS PLAN STATEMENT OF INCOME AND CHANGES IN PLAN EQUITY YEAR ENDED DECEMBER 31, 2000 FIXED INCOME BALANCED EQUITY FUND FUND FUND ADDITIONS Contributions: Employee $ 2,666,921 $ 1,293,678 $ 6,630,708 Employer 866,188 661,578 2,456,718 Rollovers from other plans 172,949 272,654 429,101 ------------- ------------- ------------- Total Contributions 3,706,058 2,227,910 9,516,527 ------------- ------------- ------------- Investment Income: Interest and dividends 2,870,696 926,452 8,651,527 Net realized and unrealized gain (loss) on investments 46,663 (307,183) (12,181,221) ------------- ------------- ------------- Total Investment Income (Loss) 2,917,359 619,269 (3,529,694) ------------- ------------- ------------- Total Contributions and ------------- ------------- ------------- Investment Income 6,623,417 2,847,179 5,986,833 ------------- ------------- ------------- DEDUCTIONS Withdrawals and terminations (7,480,918) (1,562,641) (7,304,006) Insurance premiums and commissions - net -- -- -- Net interfund transfers (2,800,176) (1,305,299) 5,601,033 ------------- ------------- ------------- Total Deductions (10,281,094) (2,867,940) (1,702,973) ------------- ------------- ------------- (Decrease) Increase in plan equity (3,657,677) (20,761) 4,283,860 Plan equity at beginning of year 50,635,253 13,668,077 82,497,922 ------------- ------------- ------------- Plan equity at end of year $ 46,977,576 $ 13,647,316 $ 86,781,782 ============= ============= ============= THE AMETEK RETIREMENT AND SAVINGS PLAN STATEMENT OF INCOME AND CHANGES IN PLAN EQUITY YEAR ENDED DECEMBER 31, 2000 COMMON INSURANCE STOCK LOAN TOTAL CONTRACTS FUND ACCOUNT ADDITIONS Contributions: Employee $ 29,234 $ 505,774 $ -- $ 11,126,315 Employer -- 222,426 -- 4,206,910 Rollovers from other plans -- 23,863 -- 898,567 ------------- ------------- ------------- ------------- Total Contributions 29,234 752,063 -- 16,231,792 ------------- ------------- ------------- ------------- Investment Income: Interest and dividends 30,763 65,434 512,427 13,057,299 Net realized and unrealized gain (loss) on investments -- 2,400,099 -- (10,041,642) ------------- ------------- ------------- ------------- Total Investment Income (Loss) 30,763 2,465,533 512,427 3,015,657 ------------- ------------- ------------- ------------- Total Contributions and ------------- ------------- ------------- ------------- Investment Income 59,997 3,217,596 512,427 19,247,449 ------------- ------------- ------------- ------------- DEDUCTIONS Withdrawals and terminations (28,755) (832,445) (663,680) (17,872,445) Insurance premiums and commissions - net (29,234) -- -- (29,234) Net interfund transfers -- (1,178,835) (316,723) -- ------------- ------------- ------------- ------------- Total Deductions (57,989) (2,011,280) (980,403) (17,901,679) ------------- ------------- ------------- ------------- (Decrease) Increase in plan equity 2,008 1,206,316 (467,976) 1,345,770 Plan equity at beginning of year 419,059 7,572,913 6,395,692 161,188,916 ------------- ------------- ------------- ------------- Plan equity at end of year $ 421,067 $ 8,779,229 $ 5,927,716 $ 162,534,686 ============= ============= ============= ============= See accompanying notes. F-5
THE AMETEK RETIREMENT AND SAVINGS PLAN STATEMENT OF INCOME AND CHANGES IN PLAN EQUITY YEAR ENDED DECEMBER 31, 1999 FIXED INCOME BALANCED EQUITY FUND FUND FUND ADDITIONS Contributions: Employee $ 3,177,848 $ 1,329,916 $ 6,117,112 Employer 1,098,433 880,320 2,595,597 Rollovers from other plans 131,897 247,761 404,170 ------------- ------------- ------------- Total Contributions 4,408,178 2,457,997 9,116,879 ------------- ------------- ------------- Investment Income: Interest and dividends 2,857,002 938,464 6,824,004 Net realized and unrealized gain (loss) on investments (103,809) (84,246) 8,465,100 ------------- ------------- ------------- Total Investment Income (Loss) 2,753,193 854,218 15,289,104 ------------- ------------- ------------- Total Contributions and ------------- ------------- ------------- Investment Income (Loss) 7,161,371 3,312,215 24,405,983 ------------- ------------- ------------- DEDUCTIONS Withdrawals and terminations (5,859,879) (556,887) (4,714,253) Insurance premiums and commissions - net -- -- -- Net interfund transfers (630,079) (643,420) 2,170,817 ------------- ------------- ------------- Total Deductions (6,489,958) (1,200,307) (2,543,436) ------------- ------------- ------------- Increase (decrease) in plan equity 671,413 2,111,908 21,862,547 Plan equity at beginning of year 49,963,840 11,556,169 60,635,375 ------------- ------------- ------------- Plan equity at end of year $ 50,635,253 $ 13,668,077 $ 82,497,922 ============= ============= ============= THE AMETEK RETIREMENT AND SAVINGS PLAN STATEMENT OF INCOME AND CHANGES IN PLAN EQUITY YEAR ENDED DECEMBER 31, 1999 COMMON INSURANCE STOCK LOAN TOTAL CONTRACTS FUND ACCOUNT ADDITIONS Contributions: Employee $ 32,825 $ 645,724 $ -- $ 11,303,425 Employer -- 332,084 -- 4,906,434 Rollovers from other plans -- 59,713 -- 843,541 ------------- ------------- ------------- ------------- Total Contributions 32,825 1,037,521 -- 17,053,400 ------------- ------------- ------------- ------------- Investment Income: Interest and dividends 28,940 76,820 589,459 11,314,689 Net realized and unrealized gain (loss) on investments -- (1,266,576) -- 7,010,469 ------------- ------------- ------------- ------------- Total Investment Income (Loss) 28,940 (1,189,756) 589,459 18,325,158 ------------- ------------- ------------- ------------- Total Contributions and ------------- ------------- ------------- ------------- Investment Income (Loss) 61,765 (152,235) 589,459 35,378,558 ------------- ------------- ------------- ------------- DEDUCTIONS Withdrawals and terminations (76,734) (608,202) (547,091) (12,363,046) Insurance premiums and commissions - net (32,825) -- -- (32,825) Net interfund transfers -- (1,004,884) 107,566 -- ------------- ------------- ------------- ------------- Total Deductions (109,559) (1,613,086) (439,525) (12,395,871) ------------- ------------- ------------- ------------- Increase (decrease) in plan equity (47,794) (1,765,321) 149,934 22,982,687 Plan equity at beginning of year 466,853 9,338,234 6,245,758 138,206,229 ------------- ------------- ------------- ------------- Plan equity at end of year $ 419,059 $ 7,572,913 $ 6,395,692 $ 161,188,916 ============= ============= ============= ============= See accompanying notes. F-6
THE AMETEK RETIREMENT AND SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2001 1. DESCRIPTION OF THE PLAN The following brief description of the AMETEK Retirement and Savings Plan ("the Plan") provides only summarized information. Participants should refer to the full Summary Plan Description for more complete information. The Plan is a tax-deferred 401(k) defined contribution savings plan, with a separate retirement feature described below, which provides eligible employees of AMETEK, Inc. ("AMETEK", or "the Company"), and certain of its subsidiaries, an opportunity to invest up to 14% of their compensation in one or a combination of investment programs (described in Note 3). Effective January 1, 2001, the Plan was amended so that participants are fully vested at all times in both their contributions to the Plan and in Company contributions. Prior to January 1, 2001, Company contributions vested after three years of service, or upon death, attainment of age 65 or normal or disability retirement. Forfeited Company contributions, which are insignificant in amount, are used to reduce current-year Company contributions. If a participant terminates employment with the Company for any reason, he or she may receive a distribution following termination of employment or may elect to commence distributions at, or after age 55, but no later than age 70-1/2. When a participant attains age 59-1/2 while still an employee, he or she can elect to withdraw the vested amount of his or her 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. The Plan also allows participants to borrow funds from their accounts, subject to a charge for administrative fees, and other certain limitations, and such amounts are reflected in a loan account until repaid by the participant (see Note 4). The Plan provides for Company contributions equal to 33 1/3% of the first 6% of compensation contributed by each participant, to a maximum annual contribution of $1,200 per participant. 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 any time prior to the due date prescribed by law for filing the Company's federal income tax return for that Plan year. The Plan has a retirement feature for eligible salaried and hourly employees hired by AMETEK after December 31, 1996. AMETEK makes contributions to the Plan on behalf of such employees equal to a specified percentage of their compensation earned based upon each participant's age and years of service, up to predetermined limits. Employee contributions under the retirement feature of the Plan are not permitted. Investment programs and transfer and exchange privileges available under the retirement feature are the same as for the savings feature under the Plan. However, retirement feature contributions become fully vested after five years of service (three years of service for contributions on or after January 1, 2002), and loans and withdrawals are not permitted. 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 the Employee Retirement Income Security Act of 1974 as amended ("ERISA"), and applicable labor agreements. In the event of termination, each participant will receive the value of his or her separate account. Participants' collective accounts are represented by the Plan's equity as shown in the accompanying financial statements. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of financial statements 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 former participants, which are reflected in plan equity in accordance with accounting principles generally accepted in the United States (see Note 8). 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. Dividend income is recorded on the ex-dividend date. Income from other investments is recorded as earned. Use of estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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. Investment valuation Investments in equity securities are carried at market value based upon closing market quotes 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. Life Insurance Contracts are carried at the cash surrender value of such policies at year-end. F-7
THE AMETEK RETIREMENT AND SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2001 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Guaranteed Investment Contracts ("GICs"), all of which are considered benefit-responsive, are reported at contract value, which approximates fair value. Fully benefit-responsive investment contracts are contracts that transfer financial risk of principal and interest to a responsible third party, and provide for participant-initiated transactions without conditions, limitations or restrictions. All other investment contracts are reported at fair value. 3. INVESTMENT PROGRAMS At December 31, 2001 and 2000, the Vanguard Fiduciary Trust Company was the Trustee and a party-in-interest of the Plan. Each participant may have his or her accounts invested (up to certain specified limits) in one or a combination of the following investment programs: (a) The Fixed Income Funds: The Fixed Income Funds are comprised of the VRST Master Trust ("Trust"), whose assets were transferred from the Vanguard Retirement Savings Trust, in exchange for units of equal value, effective July 2, 2001. The Trust invests in a diversified portfolio of GICs issued by insurance companies and other financial institutions. Contributions to the retirement savings trust and proceeds from its GIC maturities are invested entirely in the Vanguard Stable Value Market Fund, which invests in a diversified GIC portfolio. As of December 31, 2001, all individual GICs had matured and the proceeds were invested in the Vanguard Stable Value Market Fund. The Fixed Income Fund also holds investments in two additional Vanguard Funds: a Total Bond Market Index Fund and a Prime Money Market Fund. Investments of the Fixed Income Fund (carried at fair value) are shown in the table below: Balance at December 31, --------------- 2001 2000 ---- ---- GICs * $39,407,287 $38,731,332 ----------- ----------- Mutual Funds: Prime Money Market Fund 7,057,049 6,755,439 Vanguard Total Bond Market Index Fund (cost 2001 - 2,180,641 1,255,983 ----------- ----------- $2,166,322 and 2000 - $1,252,332) 9,237,690 8,011,422 ----------- ----------- Total Fixed Income Fund investments $48,644,977 $46,742,754 =========== =========== *At December 31, 2001 the Vanguard Stable Value Market Fund comprised the total amount of the GIC investment and $37,175,517 of such amount at December 31, 2000. This investment represents 5% or more of the fair value of the Plan's net assets. Income on the GICs is earned based on interest rates ranging from 3.9% to 8.2% for the year ended December 31, 2001 and 2.4% to 7.0% for the year ended December 31, 2000. Variable-rate contracts are reset quarterly, but will not fall below zero. Other contracts with fixed rates of interest through maturity range between 5.5% and 7.4% for the year ended December 31, 2001 and 6.1% for the year ended December 31, 2000. The weighted average crediting interest rate for GICs was 5.8% for 2001 and 6.1% for 2000. The average yield for all investments within the Fixed Income Fund was 5.6% and 5.9% for the Plan years ended December 31, 2001 and 2000, respectively, net of investment expenses. F-8
THE AMETEK RETIREMENT AND SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2001 3. INVESTMENT PROGRAMS (continued) (b) The Balanced Funds: Participants investing in the Balanced Funds have two alternatives for allocating their accounts: 1. Vanguard LifeStrategy Growth Funds - Participants may select among three growth strategies (Conservative Growth, Moderate Growth, and Aggressive Growth), each with corresponding levels of asset allocations and investment risks. Each portfolio invests in various mutual funds within the Vanguard Group with fund objectives meeting the overall strategy chosen by the participant. 2. Vanguard Wellington Fund - This fund invests in dividend-paying large and mid-capitalization stocks of well-established companies, as well as bonds. The fund seeks income and long-term capital appreciation, with an average blend of assets of 65% in stocks and 35% in bonds. At December 31, 2001 and 2000 the investments of the Balanced Fund consisted of the following: ----------------------------------------------------------------------------- 2001 2000 ----------------------------------------------------------------------------- Number of Cost Market Number of Cost Market Shares Value Shares Value ----------------------------------------------------------------------------- Vanguard LifeStrategy Growth Funds 323,775 $ 5,631,467 $ 5,233,917 280,916 $ 5,035,344 $ 4,991,108 Vanguard Wellington Fund * 366,486 10,814,156 9,990,416 302,238 9,072,484 8,526,140 ------- ----------- ----------- ------- ----------- ----------- Total Balanced Fund 690,261 $16,455,623 $15,224,333 583,154 $14,107,828 $13,517,248 ======= =========== =========== ======= =========== =========== * At December 31, 2001 and 2000, this investment represents 5% or more of the fair value of the Plan's net assets. (c) The Equity Funds: The Equity Funds consist of mutual funds primarily in the Vanguard Group of Equity Funds. The fund includes the Vanguard Windsor II Fund, the Vanguard PRIMECAP Fund, the Vanguard International Growth Fund, the Vanguard 500 Index Fund, and the Vanguard Small Cap Index Fund. Equity Fund participants may also invest in the Fidelity Magellan Fund, which is a broadly diversified mutual fund investing in a wide range of worldwide stocks and other types of investments. The BlackRock Small Cap Fund is also included in the Equity Fund. Both the Vanguard funds and the BlackRock fund seek long-term capital appreciation. All of the mutual funds mentioned above use various investment techniques, including foreign exchange and derivatives transactions, though generally these funds carry significant limitations as to the use of such techniques. Shares in each fund are purchased at the net asset value of the respective funds and no direct commissions, fees or other charges are assessed against the accounts in these funds. F-9
THE AMETEK RETIREMENT AND SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2001 3. INVESTMENT PROGRAMS (continued) At December 31, 2001 and 2000, the investments of the Equity Fund consisted of the following: -------------------------------------------------------------------------------------- 2001 2000 -------------------------------------------------------------------------------------- Number Market Number Market Of Cost Value of Cost Value Shares Shares -------------------------------------------------------------------------------------- Vanguard Group of Equity Funds: Vanguard Windsor II Fund * 682,426 $20,123,405 $17,463,297 641,695 $19,241,916 $17,448,403 Vanguard PRIMECAP Fund * 340,501 18,383,799 17,542,612 336,328 18,474,398 20,308,985 Vanguard Int'l Growth Fund 307,096 5,790,523 4,609,516 298,652 5,842,116 5,628,446 Vanguard 500 Index Fund 66,195 7,787,667 7,009,385 56,285 6,849,051 6,858,932 Vanguard Sm-Cap Index Fund 31,034 652,841 615,085 17,404 406,266 338,329 --------- ----------- ----------- --------- ----------- ----------- Total Vanguard Funds 1,427,252 52,738,235 47,239,895 1,350,364 50,813,747 50,583,095 --------- ----------- ----------- --------- ----------- ----------- Fidelity Magellan Fund * 175,937 20,627,132 18,336,170 169,917 20,385,234 20,267,830 --------- ----------- ----------- --------- ----------- ----------- BlackRock Small Cap. Fund * 781,563 18,027,247 9,988,373 787,415 19,633,023 15,377,629 --------- ----------- ----------- --------- ----------- ----------- Total Equity Fund 2,384,752 $91,392,614 $75,564,438 2,307,696 $90,832,004 $86,228,554 ========= =========== =========== ========= =========== =========== * At December 31, 2001 and 2000 these investments represents 5% of more of the fair value of the Plan's net assets. (d) Insurance Contracts: Employee contributions are presently used to maintain previously purchased life insurance policies underwritten by First Colony Life Insurance Company of Lynchburg, Virginia. Commissions paid on Insurance Contracts are charged directly against the participants' insurance accounts. This fund continues to be closed to new participants. (e) The Common Stock Fund: At December 31, 2001 and 2000, the assets of the Common Stock Fund were invested in AMETEK, Inc. common stock. At December 31, 2001, the investment consisted of 972,587 shares having a cost of $6,127,182 and a market value of $10,163,534. At December 31, 2000, such investment consisted of 1,026,400 shares having a cost of $6,071,150 and a market value of $8,734,662. At December 31, 2001 and 2000 this investment represents 5% of more of the fair value of the Plan's net assets. Shares of AMETEK, Inc. common stock may be purchased by the Trustee on the open market or directly from AMETEK. Brokerage commissions paid are charged against the accounts invested in this Fund. F-10
THE AMETEK RETIREMENT AND SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2001 3. INVESTMENT PROGRAMS (continued) A participant may change his or her contribution percentage election to any fund effective as of the first day of each calendar quarter. In addition, the plan provides for participant-directed investing, whereby participants may change their investment selection within or between investment programs or specific investment funds in which their contributions are invested at any time, subject to certain limitations. The Plan also permits a participant, at any time, to completely discontinue contributions on a prospective basis. There were approximately 4,300 participants in the Plan at December 31, 2001. Participants generally invest in more than one fund. 4. LOANS TO PARTICIPANTS 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 outstanding loans at any time, the sum of which may not exceed the maximum. Repayment terms of the loan are generally limited to no longer than 60 months from inception. 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, 2001 ranged between 5.7% and 10.5%. 5. NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS The components of the net realized gains and losses and the change in the net unrealized gain and loss on equity investments, which are included in investment income, are as follows: Year Ended December 31, - ----------------------------------------------------------------------------------------------------- 2001 2000 1999 - ----------------------------------------------------------------------------------------------------- Fixed Income Fund Realized gain (loss) $ 16,563 ($31,488) ($29,695) Change in net unrealized gain (loss) 10,668 78,151 (74,114) ------------ ------------ ------------ Total Fixed Income Fund 27,231 46,663 (103,809) ------------ ------------ ------------ Balanced Fund Realized loss (119,447) (295,827) (53,935) Change in net unrealized loss (640,710) (11,356) (30,311) ------------ ------------ ------------ Total Balanced Fund (760,157) (307,183) (84,246) ------------ ------------ ------------ Equity Fund Realized (loss) gain (2,999,102) 748,276 984,854 Change in net unrealized (loss) gain (11,224,726) (12,929,497) 7,480,246 ------------ ------------ ------------ Total Equity Fund (14,223,828) (12,181,221) 8,465,100 ------------ ------------ ------------ Common Stock Fund Realized gain 585,443 253,808 285,482 Change in net unrealized gain (loss) 1,372,840 2,146,291 (1,552,058) ------------ ------------ ------------ Total Common Stock Fund 1,958,283 2,400,099 (1,266,576) ------------ ------------ ------------ Total net realized and unrealized (loss) gain Included in investment income ($12,998,471) ($10,041,642) $ 7,010,469 ============ ============ ============ F-11
THE AMETEK RETIREMENT AND SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2001 5. NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS (continued) The net unrealized gain (loss) on investments included in the Plan's equity is as follows: ------------------------------------------------------------------------------------------ Common Fixed Income Balanced Equity Stock Total Fund Fund Fund Fund - ------------------------------------------------------------------------------------------------------------------------- Balance December 31, 1998 ($386) ($548,913) $ 845,801 $ 2,069,279 $ 2,365,781 Change for the year 1999 (74,114) (30,311) 7,480,246 (1,552,058) 5,823,763 -------- ----------- ------------ ------------ ------------ Balance December 31, 1999 (74,500) (579,224) 8,326,047 517,221 8,189,544 Change for the year 2000 78,151 (11,356) (12,929,497) 2,146,291 (10,716,411) -------- ----------- ------------ ------------ ------------ Balance December 31, 2000 3,651 (590,580) (4,603,450) 2,663,512 (2,526,867) Change for the year 2001 10,668 (640,710) (11,224,726) 1,372,840 (10,481,928) -------- ----------- ------------ ------------ ------------ Balance December 31, 2001 $ 14,319 ($1,231,290) ($15,828,176) $ 4,036,352 ($13,008,795) ======== =========== ============ ============ ============ 6. FEDERAL INCOME TAX STATUS The Plan had received a determination letter from the Internal Revenue Service, stating that the Plan qualified under Section 401(a) of the Internal Revenue Code, and, therefore, exempt from federal income tax. Effective January 1, 2001, the Plan was amended and restated. The Plan has applied for but has not received a new determination letter from the Internal Revenue Service that the Plan continues to be qualified. However, 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, is qualified and the related trust is exempt from Federal income tax. Under the Plan, contributions will not be taxed to the employee until a distribution from the Plan is made. However, participants who have invested in insurance contracts are subject to ordinary income tax annually on the premiums paid for the life insurance coverage. 7. EXPENSES The expenses of administering the Plan are payable from the trust funds, unless the Company elects to pay such expenses. For all Plan years presented, the Company elected to pay such expenses directly. F-12
THE AMETEK RETIREMENT AND SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2001 8. DIFFERENCES BETWEEN FINANCIAL STATEMENTS AND FORM 5500 The following is a reconciliation of Plan equity at December 31, 2001 and 2000, presented in the financial statements in accordance with accounting principles generally accepted in the United States, and the reduction for amounts owed to former participants upon withdrawal and termination from the Plan for the year ended December 31, 2001 compared to the amounts reported on Form 5500. Amounts owed to former participants are reported on the Form 5500 for benefit claims that have been processed but not paid at year-end. Such amounts are not recorded as liabilities under accounting principles generally accepted in the United States. -------------------------------------------------------------------------------------------------- Fixed Common Income Balanced Equity Insurance Stock Loan Total Fund Fund Fund Contracts Fund Account - ---------------------------------------------------------------------------------------------------------------------------------- Plan Equity December 31, 2001: Plan equity reported in the Financial statements $49,103,517 $15,476,690 $76,514,453 $395,830 $10,238,339 $5,215,355 $156,944,184 Amounts owed to former Participants (2,213,627) (680,688) (1,591,587) -- (331,877) (230,075) (5,047,854) ----------- ----------- ----------- -------- ----------- ---------- ------------ Plan equity (net assets) Reported on Form 5500 $46,889,890 $14,796,002 $74,922,866 $395,830 $ 9,906,462 $4,985,280 $151,896,330 =========== =========== =========== ======== =========== ========== ============ Plan Equity December 31, 2000: Plan equity reported in the Financial statements $46,977,576 $13,647,316 $86,781,782 $421,067 $ 8,779,229 $5,927,716 $162,534,686 Amounts owed to former Participants (3,115,249) (495,095) (2,653,380) -- (233,912) (213,079) (6,710,715) ----------- ----------- ----------- -------- ----------- ---------- ------------ Plan equity (net assets) Reported on Form 5500 $43,862,327 $13,152,221 $84,128,402 $421,067 $ 8,545,317 $5,714,637 $155,823,971 =========== =========== =========== ======== =========== ========== ============ Withdrawals and Terminations Year ended December 31, 2001: Withdrawals and terminations reported in the financial statements $ 6,620,524 $ 806,777 $ 5,276,619 $ 57,095 $ 651,622 $ 998,317 $ 14,410,954 Add: Amounts owed to Former participants at December 31, 2001 2,213,627 680,688 1,591,587 -- 331,877 230,075 5,047,854 Less: Amounts owed to Former participants at December 31, 2000 (3,115,249) (495,095) (2,653,380) -- (233,912) (213,079) (6,710,715) ----------- ----------- ----------- -------- ----------- ---------- ------------ Payments to provide benefits Reported on Form 5500 $ 5,718,902 $ 992,370 $ 4,214,826 $ 57,095 $ 749,587 $1,015,313 $ 12,748,093 =========== =========== =========== ======== =========== ========== ============ F-13
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. The AMETEK Retirement and Savings Plan -------------------------- (Name of Plan) Dated: June 14, 2002 By: /s/ John J. Molinelli ------------------------------- John J. Molinelli, Member, Administrative Committee F-14
THE AMETEK RETIREMENT AND SAVINGS PLAN EXHIBIT INDEX Exhibit Number Description - -------------- ----------- 23 Consent of Independent Auditors F-15
Exhibit 23 Consent of Independent Auditors We consent to the incorporation by reference in the Registration Statements (Form S-8 Nos. 333-34789, 333-80449, 333-87491, and 333-91507) pertaining to the 1997 Stock Incentive Plan of AMETEK, Inc., the 1999 Stock Incentive Plan of AMETEK, Inc., the AMETEK Retirement and Savings Plan and the AMETEK 401(K) Plan for Acquired Businesses, and to the AMETEK Inc. Deferred Compensation Plan, respectively, and in the related Prospectuses, of our report dated June 7, 2002, with respect to the financial statements of the AMETEK Retirement and Savings Plan included in this Annual Report (Form 11-K) for the year ended December 31, 2001. /s/ Ernst & Young LLP Philadelphia, Pennsylvania June 11, 2002