UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended September 30, 2007

o		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 1-12981

AMETEK, Inc.

DELAWARE		14-1682544
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

    37 North Valley Road, Building 4, P.O. Box 1764, Paoli, Pennsylvania 19301-0801      

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code   610-647-2121  

     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, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer þ Accelerated filer o Non-accelerated filer 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

     The number of shares of the issuer’s common stock outstanding as of the latest practicable date was: Common Stock, $0.01 Par Value, outstanding at October 26, 2007 was 107,282,243 shares.

 

 

AMETEK, Inc.
Form 10-Q
Table of Contents

		Page Number
Part I. Financial Information
Item 1. Financial Statements
Consolidated Statement of Income for the Three and Nine Months Ended September 30, 2007 and 2006			3
Consolidated Balance Sheet as of September 30, 2007 and December 31, 2006			4
Condensed Consolidated Statement of Cash Flows for the Nine Months Ended September 30, 2007 and 2006			5
Notes to Consolidated Financial Statements			6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			16
Item 4. Controls and Procedures			23
Part II. Other Information
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			24
Item 6. Exhibits			25
Signatures			26
Amended & Restated Supplemental Sr Exec Death Benefit Plan
Amended & Restated 2004 Exec Death Benefit Plan
Amended & Restated AMETECK Directors' Death Benefit Plan
Amended & Restated AMETEK Retirement Plan for Directors
Amended & Restated AMETEK Supplemental Exec Retirement Plan
Amended & Restated AMETEK Deferred Compensation Plan
Form of Amended & Restated Termination and Change of Control Agreement
Amended & Restated Termination & Change of Control Agreement
Form of Amended & Restated Restricted Stock Agreement Between Company & Certain Executives
Certification of CEO, Sec 302
Certification of CFO, Sec 302
Certification of CEO, Sec 906
Certification of CFO, Sec 906

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

AMETEK, Inc.

CONSOLIDATED STATEMENT OF INCOME (Unaudited)
(In thousands, except per share amounts)

		Three months ended								Nine months ended
		September 30,								September 30,
		2007				2006				2007				2006
Net sales		$	528,849			$	464,164			$	1,553,600			$	1,338,616
Expenses:
Cost of sales, excluding depreciation			356,682				318,275				1,050,263				919,351
Selling, general and administrative			65,687				56,197				190,594				160,324
Depreciation			10,476				9,862				30,205				29,211
Total expenses			432,845				384,334				1,271,062				1,108,886
Operating income			96,004				79,830				282,538				229,730
Other (expenses) income:
Interest expense			(12,182	)			(11,162	)			(34,089	)			(31,551	)
Other, net			(425	)			17				(2,528	)			(1,309	)
Income before income taxes			83,397				68,685				245,921				196,870
Provision for income taxes			26,153				21,314				79,764				62,773
Net income		$	57,244			$	47,371			$	166,157			$	134,097
Basic earnings per share		$	0.54			$	0.45			$	1.57			$	1.28
Diluted earnings per share		$	0.53			$	0.45			$	1.55			$	1.26
Average common shares outstanding:
Basic shares			106,136				104,667				105,642				104,878
Diluted shares			107,764				106,332				107,359				106,622
Dividends declared and paid per share		$	0.06			$	0.04			$	0.18			$	0.12

See accompanying notes.

AMETEK, Inc.      

CONSOLIDATED BALANCE SHEET      

(In thousands)      

		September 30,				December 31,
		2007				2006
		(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents		$	72,557			$	49,091
Marketable securities			10,885				9,129
Receivables, less allowance for possible losses			377,934				328,762
Inventories			313,267				236,783
Deferred income taxes			30,853				26,523
Other current assets			40,063				33,775
Total current assets			845,559				684,063
Property, plant and equipment, at cost			796,464				749,822
Less accumulated depreciation			(511,027	)			(491,814	)
			285,437				258,008
Goodwill			992,473				881,433
Other intangibles, net of accumulated amortization			280,246				199,728
Investments and other assets			110,435				107,644
Total assets		$	2,514,150			$	2,130,876
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Short-term borrowings and current portion of long-term debt		$	233,111			$	163,608
Accounts payable			189,276				160,614
Accruals			187,196				156,678
Total current liabilities			609,583				480,900
Long-term debt			547,219				518,267
Deferred income taxes			98,752				65,081
Other long-term liabilities			106,622				99,956
Stockholders’ equity:
Common stock			1,096				1,085
Capital in excess of par value			170,480				134,001
Retained earnings			1,043,789				902,379
Accumulated other comprehensive losses			(20,321	)			(33,552	)
Treasury stock			(43,070	)			(37,241	)
			1,151,974				966,672
Total liabilities and stockholders’ equity		$	2,514,150			$	2,130,876

See accompanying notes.

AMETEK, Inc.

(In thousands)

		Nine months ended
		September 30,
		2007				2006
Cash provided by (used for):
Operating activities:
Net income		$	166,157			$	134,097
Adjustments to reconcile net income to total operating activities:
Depreciation and amortization			37,626				34,371
Deferred income taxes			4,670				386
Share-based compensation expense			12,345				9,171
Net change in assets and liabilities			(34,101	)			(8,742	)
Pension contribution			(1,895	)			(10,000	)
Other			(2,917	)			1,344
Total operating activities			181,885				160,627
Investing activities:
Additions to property, plant and equipment			(24,487	)			(18,211	)
Purchases of businesses and other			(189,529	)			(122,209	)
Total investing activities			(214,016	)			(140,420	)
Financing activities:
Net change in short-term borrowings			65,958				6,282
Additional long-term borrowings			—				29,507
Reduction in long-term borrowings			(8,677	)			(19,160	)
Repurchases of common stock			(5,437	)			(21,075	)
Cash dividends paid			(19,208	)			(12,602	)
Excess tax benefits from share-based payments			7,541				3,204
Proceeds from stock options			14,699				6,941
Deferred debt financing fees			(2,247	)			—
Total financing activities			52,629				(6,903	)
Effect of exchange rate changes on cash and cash equivalents			2,968				2,259
Increase in cash and cash equivalents			23,466				15,563
Cash and cash equivalents:
As of January 1			49,091				35,545
As of September 30		$	72,557			$	51,108

See accompanying notes.

AMETEK, Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2007

(Unaudited)

Note 1 – Basis of Presentation

     The accompanying consolidated financial statements are unaudited. The Company believes that all adjustments (which primarily consist of normal recurring accruals) necessary for a fair presentation of the consolidated financial position of the Company at September 30, 2007, and the consolidated results of its operations for the three- and nine-month periods ended September 30, 2007 and 2006 and its cash flows for the nine month periods ended September 30, 2007 and 2006 have been included. Quarterly results of operations are not necessarily indicative of results for the full year. The accompanying financial statements should be read in conjunction with the financial statements and related notes presented in the Company’s Annual Report on Form 10-K for the year ended December 31, 2006 as filed with the Securities and Exchange Commission.

Note 2 – Recent Accounting Pronouncements

     Effective January 1, 2007, the Company adopted Financial Accounting Standards Board (“FASB”) Interpretation No. 48, Accounting for Uncertainty in Income Taxes (“FIN 48”). FIN 48 creates a single model to address accounting for uncertainty in tax positions, by prescribing a minimum recognition threshold a tax position is required to meet before being recognized in the financial statements. FIN 48 also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. The cumulative effect of adopting FIN 48 resulted in a non-cash reduction of $5.9 million to the January 1, 2007 opening balance of retained earnings (See Note 10).

     Effective January 1, 2007, the Company adopted Emerging Issues Task Force (EITF) Issue No. 06-5, Accounting for Purchases of Life Insurance- Determining the Amount That Could Be Realized in Accordance with FASB Technical Bulletin No. 85-4 (“EITF 06-5”). EITF 06-5 provides guidance in determining the amount to be realized under certain insurance contracts and the related disclosures. Adoption of EITF 06-5 did not have any effect on the Company’s consolidated results of operations, financial position and cash flows.

     In September 2006, the FASB issued Statement of Financial Accounting Standards (“SFAS”) No. 157, Fair Value Measurements. SFAS 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. SFAS 157 applies under other accounting pronouncements that require or permit fair value measurements. SFAS 157 does not require any new fair value measurements and is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. The Company is currently evaluating the impact of FAS 157.

     In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities – Including an Amendment of FASB Statement No. 115 (“FAS 159”) which is effective for fiscal years beginning after November 15, 2007. This statement permits an entity to elect to measure certain assets and liabilities at fair value at specified election dates. The Company is currently evaluating the impact of adopting FAS 159 on our financial statements.

AMETEK, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2007
(Unaudited)

Note 3 — Earnings Per Share

     The calculation of basic earnings per share for the three- and nine-month periods ended September 30, 2007 and 2006 is based on the average number of common shares considered outstanding during the periods. The calculation of diluted earnings per share for such periods reflects the effect of all potentially dilutive securities (outstanding common stock options and restricted stock grants). The following table presents the number of shares used in the calculation of basic earnings per share and diluted earnings per share:

		Weighted average shares (In thousands)
		Three months ended								Nine months ended
		September 30,								September 30,
		2007				2006				2007				2006
Basic shares			106,136				104,667				105,642				104,878
Share-based award plans			1,628				1,665				1,717				1,744
Diluted shares			107,764				106,332				107,359				106,622

Note 4 – Acquisitions

     The total investment in the acquisition of five new businesses in the first nine months of 2007 was $214.6 million, which includes $189.0 million in cash, net of cash acquired, as well as assumed debt and other long-term liabilities (which includes a capital lease obligation) of $25.6 million. The acquisitions include Seacon Phoenix (“Seacon”) in April 2007, Advanced Industries, Inc. (“Advanced”), B&S Aircraft Parts and Accessories (“B&S”), and Hamilton Precision Metals (“Hamilton”) in June 2007 and Cameca SAS (“Cameca”) in August 2007. Seacon provides undersea electrical interconnect subsystems to the global submarine market. Advanced manufactures starter generators, brush and brushless motors, vane-axial centrifugal blowers for cabin ventilation, and linear actuators for the business jet, light jet, and helicopter markets. B&S provides third party maintenance, repair and operation (MRO) services, primarily for starter generators and hydraulic and fuel system components, for a variety of business aircraft and helicopter applications. Hamilton produces highly differentiated niche specialty metals used in medical implant devices and surgical instruments, electronic components and measurement devices for aerospace and other industrial markets. Cameca is a manufacturer of high-end elemental analysis systems used in advanced laboratory research, semiconductor and nanotechnology applications. Advanced, B&S and Cameca are part of the Company’s Electronic Instruments Group. Seacon and Hamilton are part of the Company’s Electromechanical Group. The five businesses acquired have annualized sales of approximately $152 million.

     The acquisitions have been accounted for using the purchase method in accordance with SFAS No. 141, “Business Combinations.” Accordingly, the operating results of the above acquisitions have been included in the Company’s consolidated results from the respective dates of acquisition.

AMETEK, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2007
(Unaudited)

     The following table represents the tentative allocation of the aggregate purchase price for the net assets of the above acquisitions based on their estimated fair value:

		In millions
Property, plant and equipment		$	25.3
Goodwill			99.7
Other intangible assets			58.7
Net working capital and other (a)			5.3
Allocation of purchase price		$	189.0

     The amount allocated to goodwill is reflective of the benefits the Company expects to realize from the acquisitions as follows: The Seacon acquisition is an excellent strategic fit with the Company’s engineered materials, interconnects and packaging business and extends the Company’s reach into new defense markets. The Advanced acquisition complements the Company’s AMPHION product line of power management products for the aerospace industry and broadens our product offering in the power management subsystem market. The B&S acquisition further expands the Company’s position in the third party aerospace MRO market. The Hamilton acquisition is a strategic fit with our engineered materials, interconnects and packaging business and has strong positions in growing specialty metals niche markets within the aerospace and other industrial markets. The Cameca acquisition broadens the Company’s technical capabilities in high-end elemental analysis systems used in advanced laboratory research, semiconductor and nanotechnology applications.

     The Company is in the process of conducting third party valuations of certain tangible and intangible assets acquired, as well as finalizing restructuring plans for certain acquisitions. Adjustments to the allocation of purchase price will be recorded within the purchase price allocation period of up to twelve months subsequent to the dates of acquisition. Therefore, the allocation of the purchase price is subject to revision.

     Had the above acquisitions been made at the beginning of 2007, net sales, net income and diluted earnings per share for the three- and nine-month periods ended September 30, 2007 would not have been materially different than the amounts reported.

     Had the above acquisitions and the acquisitions of Pulsar, Pittman, Land Instruments, Precitech and Southern Aeroparts, which were acquired in February, May, June, November and December 2006, respectively, been made at the beginning of 2006, pro forma net sales, net income, and diluted earnings per share for the three- and nine-month periods ended September 30, 2006, would have been as follows:

		(In millions, except per share)
		Three months ended				Nine months ended
		September 30, 2006				September 30, 2006
Net sales		$	495.1			$	1,484.6
Net income		$	46.5			$	138.3
Diluted earnings per share		$	0.44			$	1.30

     Pro forma results are not necessarily indicative of the results that would have occurred if the acquisitions had been completed at the beginning of 2006.

AMETEK, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2007
(Unaudited)

Acquisition subsequent to September 30, 2007

     On November 1, 2007, the Company acquired Umeco Repair and Overhaul (“Umeco R&O”), the leading UK-based independent provider of maintenance, repair and overhaul (MRO) services to the aviation industry for $74 million (£36 million). With annual sales of approximately $58 million (£ 28 million), Umeco R&O adds to the Company’s position in third party MRO services, providing a strong European presence. Umeco R&O operates from multiple locations within the UK and in Toulouse, France and will be a part of AMETEK’s Electromechanical Group.

Note 5 – Goodwill

     The changes in the carrying amounts of goodwill by segment from December 31, 2006 to September 30, 2007, were as follows:

		(In millions)
		EIG				EMG				Total
Balance at December 31, 2006		$	531.7			$	349.7			$	881.4
Goodwill acquired during the period			63.3				36.4				99.7
Purchase price allocation adjustments and other*			(4.3	)			(3.2	)			(7.5	)
Foreign currency translation adjustments			15.5				3.4				18.9
Balance at September 30, 2007		$	606.2			$	386.3			$	992.5

Note 6 — Inventories

     The components of inventory consist of the following:

		(In thousands)
		September 30,				December 31,
		2007				2006
Finished goods and parts		$	61,592			$	46,148
Work in process			95,541				56,502
Raw materials and purchased parts			156,134				134,133
Total		$	313,267			$	236,783

     Inventory increased $76.5 million from December 31, 2006 to September 30, 2007. The 2007 acquisitions added $54.7 million to the September 30, 2007 balance.

AMETEK, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2007
(Unaudited)

Note 7 – Debt

     In the third quarter of 2007 the Company entered into a private placement to sell $450 million in Senior Notes to a group of institutional investors. The Notes will be issued on two delayed drawing dates. The first funding will occur in December 2007 for $370 million, consisting of $270 million in aggregate principal amount of 6.20% Senior Notes due December 2017 and $100 million in aggregate principal amount of 6.30% Senior Notes due December 2019. The second funding date will be in July 2008 for $80 million in aggregate principal amount of 6.35% Senior Notes due July 2018. The Notes will carry a weighted-average interest rate of approximately 6.25%. The Notes are subject to certain customary covenants including certain financial covenants. The proceeds from the Notes will be used to fund the repayment of existing indebtedness, including redemption of the $225 million of 7.20% Senior Notes due July of 2008 and for general corporate purposes. The Notes are subject to certain customary covenants including certain financial covenants.

     In June 2007, the Company amended its Revolving Credit facility, increasing the total borrowing capacity from $400 million to $550 million, which includes an accordion feature that permits the Company to request up to an additional $100 million in revolving credit commitments at any time during the life of the revolving credit agreement under certain conditions. The amendment also extended the term of the revolver from October 2011 to June 2012. At September 30, 2007, the Company had $367.7 million available under its revolving credit facility, including the $100 million accordion feature.

     The accounts receivable securitization facility was amended and restated in May 2007, to increase the Company’s available borrowing capacity from $75 million to $110 million as well as extend the expiration date from May 2007 to May 2008. As of September 30, 2007, the Company had utilized $85 million under the accounts receivable securitization facility.

AMETEK, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2007
(Unaudited)

Note 8 — Comprehensive Income

     Comprehensive income includes all changes in stockholders’ equity during a period except those resulting from investments by and distributions to stockholders.

     The following table presents comprehensive income for the three- and nine-month periods ended September 30, 2007 and 2006:

		(In thousands)
		Three months ended								Nine months ended
		September 30,								September 30,
		2007				2006				2007				2006
Net Income		$	57,244			$	47,371			$	166,157			$	134,097
Foreign currency translation adjustment			6,811				(1,029	)			6,858				4,941
Foreign currency net investment hedge*			3,631				625				5,749				5,897
Other			183				162				624				232
Total comprehensive income		$	67,869			$	47,129			$	179,388			$	145,167

Note 9 – Share-Based Compensation

     Under the terms of the Company’s stockholder approved share-based plans, incentive and non-qualified stock options and restricted stock awards have been, and may be, issued to the Company’s officers, other management-level employees and its Board of Directors. Employees and non-employee director stock options generally vest over a four-year service period. Restricted stock awards generally cliff-vest at the end of a four year service period. Options primarily have a maximum contractual term of 7 years. At September 30, 2007, 8.9 million shares of common stock were reserved for issuance under the Company’s share-based plans, including 4.0 million stock options outstanding. The Company issues previously un-issued shares when options are exercised, and shares are issued from treasury stock upon the award of restricted stock.

     For grants under any of the Company’s plans that are subject to graded vesting over a service period, we recognize expense on a straight-line basis over the requisite service period for the entire award. The fair value of each option grant is estimated on the date of grant using a Black-Scholes option pricing model.

     The following weighted average assumptions were used in the Black-Scholes model to estimate the fair values of options granted during the periods indicated:

		Nine Months Ended				Year ended
		September 30, 2007				December 31, 2006
Expected stock volatility			22.5	%			24.4	%
Expected life of the options (years)			4.7				4.8
Risk-free interest rate			4.50	%			4.71	%
Expected dividend yield			0.66	%			0.50	%

AMETEK, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2007
(Unaudited)

     Expected volatilities are based on historical volatility of the Company’s stock. The Company used historical exercise data to estimate the options’ expected term, which represents the period of time that the options granted are expected to be outstanding. Management anticipates the future option holding periods to be similar to the historical option holding periods. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. Compensation expense recognized for all share-based awards is net of estimated forfeitures. The Company’s estimated forfeiture rates are based on its historical experience.

     Total share-based compensation expense recognized under SFAS 123R for the three- and nine- months ended September 30, 2007 and 2006 was as follows:

		(In thousands)
		Three months ended								Nine months ended
		September 30,								September 30,
		2007				2006				2007				2006
Stock option expense		$	1,343			$	1,359			$	4,491			$	4,134
Restricted stock expense *			2,950				1,770				7,854				5,037
Total pretax expense			4,293				3,129				12,345				9,171
Related tax benefit			(1,159	)			(765	)			(3,419	)			(2,312	)
Reduction of net income*		$	3,134			$	2,364			$	8,926			$	6,859
Reduction of earnings per share*:
Basic		$	0.03			$	0.02			$	0.08			$	0.07
Diluted		$	0.03			$	0.02			$	0.08			$	0.06

     Pretax share-based compensation expense is included in either cost of sales, or selling, general and administrative expenses depending on where the recipient’s cash compensation is reported and is included in segment operating income and as a corporate item for business segment reporting.

AMETEK, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2007
(Unaudited)

     A summary of the Company’s stock option activity and related information for its option plans for the nine months ended September 30, 2007 was as follows:

										Weighted Average
		Shares				Weighted Average				Remaining Contractual
		(In thousands)				Exercise Price				Life (Years)
Outstanding at beginning of period			4,511			$	18.28
Granted			668				36.43
Exercised			(1,075	)			13.05
Forfeited			(84	)			26.27
Outstanding at end of period			4,020			$	22.53				4.1
Exercisable at end of period			2,323			$	16.62				3.1

     The aggregate intrinsic value of options exercised during the nine months ended September 30, 2007 was $25.8 million. The total fair value of the stock options vested during the nine months ended September 30, 2007 was $5.7 million. The aggregate intrinsic value of the stock options outstanding at September 30, 2007 was $90.5 million. The aggregate intrinsic value of the stock options exercisable at September 30, 2007 was $38.6 million. The weighted average Black-Scholes fair value of stock options granted per share was $9.54 for the nine months ended September 30, 2007 and $9.55 for the year ended December 31, 2006.

     The fair value of restricted shares under the Company’s restricted stock arrangement is determined by the product of the number of shares granted and the grant date market price of the Company’s common stock. Upon the grant of restricted stock, the fair value of the restricted shares (unearned compensation) at the date of grant, is charged as a reduction of capital in excess of par value in the Company’s consolidated balance sheet and is amortized to expense on a straight-line basis over the vesting period, which is defined at the grant date. Restricted stock awards are also subject to accelerated vesting due to certain events. On February 20, 2007, and July 9, 2007, an aggregate of 463,237 shares of restricted stock vested under an accelerated vesting provision. The charge to income due to the accelerated vesting of these shares did not have a material impact on our earnings in the respective quarters in which they vested, or for the first nine months ended September 30, 2007. At September 30, 2007 the Company had 1.1 million shares of restricted stock outstanding.

Note 10 – Income Taxes

     The Company adopted the provisions of FIN 48, Accounting for the Uncertainty in Income Taxes, as of January 1, 2007. As a result of the adoption of FIN 48, the Company recognized a $4.7 million increase in liabilities associated with unrecognized tax benefits, including interest and penalties of $2.4

AMETEK, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2007
(Unaudited)

million and a decrease of $1.2 million in goodwill related to a previous business combination, and a $5.9 million charge to the January 1, 2007, opening balance of retained earnings.

     After recognizing the impacts of adopting FIN 48, as of the adoption date, the Company had gross unrecognized tax benefits of $22.5 million of which $21.3 million, if recognized, would affect the effective tax rate.

     The Company recognizes interest and penalties accrued related to unrecognized tax benefits in income tax expense. The amounts recognized in income tax expense for interest and penalties during the third quarter and nine months ended September 30, 2007 were not significant.

     The Company files U.S. Federal income tax returns, as well as, income tax returns in various state and foreign jurisdictions. The Internal Revenue Service (IRS) is currently examining the Company’s U.S. income tax returns for 1999 – 2005. Tax years in certain state and foreign jurisdictions remain subject to examination; however the uncertain tax positions related to these jurisdictions are not considered material. At present, the Company does not expect any changes that would significantly impact the unrecognized tax benefits within the next twelve months.

Note 11 – Retirement and Pension Plans

     The following table reports total net pension expense for the three- and nine-month periods ended September 30, 2007 and 2006.

		(In thousands)
		Three months ended								Nine months ended
		September 30,								September 30,
		2007				2006				2007				2006
Defined benefit plans:
Service cost		$	1,735			$	1,637			$	5,168			$	4,866
Interest cost			6,968				6,612				20,817				18,734
Expected return on plan assets			(9,875	)			(8,995	)			(29,528	)			(25,465	)
Amortization of net actuarial loss and prior service costs			207				1,080				621				3,240
Total net pension (income) expense recognized under SFAS No. 87			(965	)			334				(2,922	)			1,375
Other plans:
Defined contribution plans			2,725				1,719				7,847				6,350
Foreign plans and other			944				906				2,711				2,611
Total other plans			3,669				2,625				10,558				8,961
Total net pension expense		$	2,704			$	2,959			$	7,636			$	10,336

AMETEK, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2007
(Unaudited)

     During the nine months ended September 30, 2007, we made $1.9 million in contributions to our worldwide defined benefit pension plans, compared with contributions of $10.0 million during the nine months ended September 30, 2006. For the full year 2007, we currently estimate that we will make contributions to our worldwide defined benefit pension plans of approximately $5 million, compared with contributions of $13.7 million for the full year 2006.

Note 12 – Product Warranties

     The Company provides limited warranties in connection with the sale of its products. The warranty periods for products sold vary widely among the Company’s operations, but for the most part do not exceed one year. The Company calculates its warranty expense provision based on past warranty experience and adjustments are made periodically to reflect actual warranty expenses.

     Changes in the Company’s accrued product warranty obligation for the nine months ended September 30, 2007 and 2006 were as follows:

		(In thousands)
		Nine months ended September 30,
		2007				2006
Balance, beginning of year		$	10,873			$	9,436
Accruals for warranties issued during the period			7,394				5,466
Settlements made during the period			(7,005	)			(5,289	)
Warranty accruals related to acquisitions and other			1,995				717
Balance, end of period		$	13,257			$	10,330

Product warranty obligations are reported as current liabilities in the consolidated balance sheet.

Note 13 — Segment Disclosure

     The Company has two reportable business segments, the Electronic Instruments Group and the Electromechanical Group. The Company aggregates its operating segments for segment reporting purposes primarily on the basis of product type, production process, distribution methods, and management organizations.

     At September 30, 2007, there were no significant changes in identifiable assets of reportable segments from the amounts disclosed at December 31, 2006, nor were there any changes in the basis of segmentation, or in the measurement of segment operating results. Operating information relating to the Company’s reportable segments for the three- and nine-month periods ended September 30, 2007 and 2006 can be found in the table on page 16 in the Management Discussion & Analysis section of this Report.

AMETEK, Inc.

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

Results of Operations

     The following table sets forth sales and income by reportable segment, and consolidated operating income and pretax income:

		Three months ended								Nine months ended
		September 30,								September 30,
		2007				2006				2007				2006
		(In thousands)
Net Sales
Electronic Instruments		$	299,006			$	262,250			$	863,652			$	742,720
Electromechanical			229,843				201,914				689,948				595,896
Consolidated net sales		$	528,849			$	464,164			$	1,553,600			$	1,338,616
Operating income and income before income taxes
Electronic Instruments		$	62,870			$	52,000			$	187,228			$	150,111
Electromechanical			43,045				36,239				124,762				104,943
Total segment operating income			105,915				88,239				311,990				255,054
Corporate and other			(9,911	)			(8,409	)			(29,452	)			(25,324	)
Consolidated operating income			96,004				79,830				282,538				229,730
Interest and other expenses, net			(12,607	)			(11,145	)			(36,617	)			(32,860	)
Consolidated income before income taxes		$	83,397			$	68,685			$	245,921			$	196,870

Operations for the third quarter of 2007 compared with the third quarter of 2006

     In the third quarter of 2007, the Company posted record third quarter sales, operating income, net income and diluted earnings per share. The Company achieved these results from strong internal growth both in the Electronic Instruments (EIG) and Electromechanical (EMG) Groups, as well as, from contributions by the acquisitions of Precitech in November 2006, Southern Aeroparts in December 2006, Seacon Phoenix in April 2007, Advanced Industries, B&S Aircraft and Hamilton Precision Metals in June 2007, and Cameca SAS (“Cameca”) in August 2007.

     Net sales for the third quarter of 2007 were $528.8 million, an increase of $64.6 million, or 13.9% when compared with net sales of $464.2 million in the third quarter of 2006. The net sales increase in the third quarter of 2007 was driven by strong internal sales growth of approximately 6%, which excludes a 2% favorable effect of foreign currency, led by the Company’s differentiated businesses. The acquisitions mentioned above contributed the remainder of the net sales increase.

     International sales for the third quarter of 2007 were $260.6 million, or 49.3% of consolidated sales, an increase of $40.9 million, or 18.6% when compared with $219.8 million, or 47.4% of consolidated sales in the same quarter of 2006. Approximately half of the increase in international sales results from increased

AMETEK, Inc.

Results of Operations (continued)

sales from base businesses, which includes the effect of foreign currency, with the remainder of the increase due to the recent acquistions. Increased international sales came primarily from sales to Europe by both Groups.

     Segment operating income for the third quarter of 2007 was $105.9 million, an increase of $17.7 million or 20.1% from $88.2 million in the third quarter of 2006. Segment operating income, as a percentage of sales, increased to 20.0% in the third quarter of 2007 from 19.0% in the third quarter of 2006. The increase in segment operating income and in operating margins resulted primarily from strength in the Company’s differentiated businesses, which includes the profit contributions made by the acquisitions.

     Selling, general and administrative expenses (SG&A) were $65.7 million in the third quarter of 2007, an increase of $9.5 million or 16.9%, when compared with the third quarter of 2006. As a percentage of sales, SG&A expenses were 12.4% in the third quarter of 2007, compared with 12.1% in the same period of 2006, primarily driven by higher selling expenses of the acquired businesses. Selling expenses, as a percentage of sales, increased to 10.6% in the third quarter of 2007, compared with 10.3% in the same period of 2006. Base business selling expenses increased 7.1% in the third quarter of 2007 compared with the third quarter of 2006, in line with internal sales growth.

     Corporate administrative expenses for the third quarter of 2007 were $9.9 million, an increase of $1.5 million when compared with the same period in 2006. The increase in corporate administrative expenses was primarily the result of higher equity-based compensation due primarily to the accelerated vesting of a restricted stock grant in the current third quarter and other expenses necessary to grow the Company. As a percentage of sales, corporate administrative expenses in the third quarter of 2007 were 1.9%, compared with 1.8% in the same period of 2006.

     Consolidated operating income totaled $96.0 million or 18.2% of sales for the third quarter of 2007, compared with $79.8 million, or 17.2% of sales for the same quarter of 2006, an increase of $16.2 million or 20.3%.

     Interest expense was $12.2 million in the third quarter of 2007, an increase of $1.0 million or 8.9%, compared with $11.2 million in the third quarter of 2006. The increase was driven by higher average debt levels incurred to fund the recent acquisitions and higher average interest rates.

     The effective tax rate for the third quarter of 2007 was 31.4% compared with 31.0% in the third quarter of 2006. The higher effective tax rate in the third quarter of 2007 primarily reflects the elimination of the Foreign Sales Corporation/Extraterritorial Income (FSC/ETI) tax benefit, partially offset by an enacted decrease in the German corporate tax rate in the third quarter of 2007.

AMETEK, Inc.

Results of Operations (continued)

     Net income for the third quarter of 2007 totaled $57.2 million, an increase of 20.7% from $47.4 million in the third quarter of 2006. Diluted earnings per share rose 17.8% to $0.53 per share, compared with $0.45 per share for the third quarter of 2006.

Segment Results

     Electronic Instruments Group (EIG) sales totaled $299.0 million in the third quarter of 2007, an increase of $36.7 million or 14.0% from $262.3 million in the same quarter of 2006. The sales increase was due to internal growth in the Group’s aerospace, power and process and analytical businesses along with the acquisitions of Precitech, Advanced Industries, B&S Aircraft and Cameca. Internal growth accounted for approximately 7% of the sales increase, excluding a favorable 2% effect of foreign currency. The acquisitions accounted for the remainder of the increase.

     Operating income of EIG was $62.9 million for the third quarter of 2007, an increase of $10.9 million or 20.9% when compared with the $52.0 million in the third quarter of 2006. Operating margins for the Group were 21.0% of sales in the third quarter of 2007 compared with operating margins of 19.8% of sales in the third quarter of 2006. The increases in segment operating income and operating margins were due to the contribution from the higher sales by the Group’s aerospace, power and process and analytical businesses.

     Electromechanical Group (EMG) sales totaled $229.8 million in the third quarter of 2007, an increase of $27.9 million or 13.8% from $201.9 million in the same quarter in 2006. The sales increase was due to solid internal growth from both the Group’s cost driven and differentiated businesses, which accounted for approximately 5% of the sales increase, excluding a favorable 1% effect of foreign currency. The acquisitions of Southern Aeroparts, Seacon Phoenix and Hamilton Precision Metals primarily accounted for the remainder of the sales increase.

     Operating income of EMG was $43.0 million for the third quarter of 2007, an increase of $6.8 million or 18.8% when compared with the $36.2 million in the third quarter of 2006. EMG’s increase in operating income was due to higher sales from both the Group’s cost driven and differentiated businesses, which includes the acquisitions mentioned above. Operating margins for the Group were at 18.7% of sales in the third quarter of 2007 compared with 17.9% of sales in the third quarter of 2006. The increase in operating margins was due to the increased contribution from both of the Group’s cost driven and differentiated businesses.

Operations for the first nine months of 2007 compared with the first nine months of 2006.

     Net sales for the first nine months of 2007 were $1,553.6 million, an increase of $215.0 million or 16.1%, compared with net sales of $1,338.6 million reported for the same period of 2006. The net sales increase in the first nine months of 2007 were driven by strong internal sales growth of approximately

AMETEK, Inc.

Results of Operations (continued)

7%, excluding a favorable 2% effect of foreign currency, led primarily by the Company’s differentiated businesses. Acquisitions contributed the remainder of the net sales increase.

     For the first nine months of 2007 international sales were $766.6 million, or 49.3% of consolidated sales, compared with $637.5 million, or 47.6% of consolidated sales, for the comparable period of 2006, an increase of $129.1 million, or 20.3%. Slightly more than half of the increase in international sales results from increased sales from base businesses, which includes the effect of foreign currency, with the remainder of the increase is driven by the recent acquisitions. The increased international sales came mainly from sales to Europe.

     Order input for the first nine months of 2007 was $1,672.7 million, compared with $1,428.5 million for the same period of 2006, an increase of $244.2 million, or 17.1%. As a result, the Company’s backlog of unfilled orders at September 30, 2007 was $655.9 million, compared with $536.8 million at December 31, 2006, an increase of $119.1 million or 22.2%. Slightly more than half of the increase in orders and backlog was driven by the recent acquisitions, which includes acquired backlog, with the remainder of the increase due to strength in our base businesses.

     Segment operating income for the first nine months of 2007 was $312.0 million, an increase of $56.9 million, or 22.3% compared with $255.1 million for the same period of 2006. Segment operating income as a percentage of sales increased to 20.1% in the first nine months of 2007 compared with 19.1% for the same period of 2006. The increase in segment operating income and operating margins resulted from strength in the differentiated businesses of each Group, which includes the profit contributions made by the acquisitions.

     Selling, general and administrative expenses were $190.6 million for the first nine months of 2007, an increase of $30.3 million or 18.9%, when compared with $160.3 million in the same period of 2006. Selling expenses, as a percentage of sales, increased to 10.4% for the first nine months of 2007, compared with 10.1% for the same period of 2006. The selling expense increase and the corresponding increase in selling expenses as a percentage of sales were due primarily to the business acquisitions. The Company’s acquisition strategy generally is to acquire differentiated businesses, which because of their distribution channels and higher marketing costs tend to have a higher content of selling expenses. Base business selling expenses increased 8.5% for the first nine months of 2007, compared with the same period of 2006, approximating the internal sales growth rate for base businesses.

     Corporate administrative expenses were $29.4 million for the first nine months of 2007, an increase of $4.2 million, or 16.7%, when compared with $25.2 million for the same period of 2006. The increase in corporate administrative expenses was primarily a result of higher compensation costs, including equity-based compensation associated with the first and third quarter 2007 accelerated vesting of restricted stock grants and other expenses necessary to grow the business. As a percentage of sales, corporate administrative expenses were unchanged at 1.9% for the first nine months of 2007 and 2006.

AMETEK, Inc.

Results of Operations (continued)

     Consolidated operating income was $282.5 million, an increase of $52.8 million or 23.0% when compared with $229.7 million for the same period of 2006. This represents an operating margin of 18.2% for the first nine months of 2007, compared with 17.2% for the same period of 2006.

     Interest expense was $34.1 million for the first nine months of 2007, an increase of $2.5 million or 7.9% when compared with $31.6 million in the same period of 2006. The increase was driven by higher average debt levels incurred to fund the recent acquisitions and higher average interest rates.

     Other expenses, net were $2.5 million in the first nine months of 2007, compared with other expenses, net of $1.3 million for the same period in 2006. The increase in expenses was primarily the result of costs associated with acquisitions the Company did not complete.

     The effective tax rate for the first nine months of 2007 was 32.4% compared with 31.9% for the same period of 2006. The increase in the effective tax rate primarily reflects the elimination of the repealed Foreign Sales Corporation/Extraterritorial Income (FSC/ETI) tax benefit, an increase in state income taxes and the adoption of FIN 48 for the recognition of interest and penalties on unrecognized tax benefits, partially offset by an enacted change in a foreign corporate tax rate in the third quarter of 2007, as well as, recognition of tax benefits which resulted from the Company’s international tax planning initiatives.

     Net income for the first nine months of 2007 was $166.2 million, or $1.55 per share on a diluted basis, compared with net income of $134.1 million, or $1.26 per diluted share for the same period of 2006.

Segment Results

     Electronic Instruments Group (EIG) net sales were $863.7 million for the first nine months of 2007, an increase of $120.9 million or 16.3% compared with $742.7 million for the same period of 2006. The sales increase was due to strong internal growth of approximately 9%, excluding a favorable 2% effect of foreign currency, driven by EIG’s aerospace, power, process and analytical businesses and the acquisitions of Land Instruments, Precitech and Cameca.

     EIG’s operating income for the first nine months of 2007 totaled $187.2 million, an increase of $37.1 million or 24.7% when compared with $150.1 million in the first nine months of 2006. The increase in operating income was primarily the result of the higher base business sales previously mentioned. Operating margins increased to 21.7% of sales in the first nine months of 2007 compared with 20.2% for the same period of 2006. The increase in operating margins was due to the contribution from the higher sales by the Group’s base differentiated businesses.

AMETEK, Inc.

Results of Operations (continued)

     Electromechanical Group (EMG) net sales totaled $689.9 million for the first nine months of 2007, an increase of $94.0 million or 15.8% compared with $595.9 million in the same period of 2006. The sales increase was due to solid internal growth of approximately 6%, excluding a favorable 1% effect of foreign currency. The acquisitions primarily accounted for the remainder of the sales increase.

     EMG’s operating income for the first nine months of 2007 was $124.8 million, an increase of $19.9 million or 19.0% when compared with $104.9 million for the same period of 2006. The operating income increase was due to strength in the Group’s differentiated businesses, including the previously mentioned acquisitions. Operating margins increased to 18.1% of sales for the first nine months of 2007, compared with 17.6% for the same period of 2006 due to the increased contribution from the Group’s differentiated businesses.

Financial Condition

Liquidity and Capital Resources

     Cash provided by operating activities totaled $181.9 million in the first nine months of 2007, compared with $160.6 million for the same period of 2006, an increase of $21.3 million, or 13.3%. The increase in operating cash flow was primarily the result of higher earnings, partially offset by higher working capital investments necessary to grow the business. In the first nine months of 2007, the Company made contributions to its defined benefit pension plans totaling $1.9 million compared with $10.0 million for the same period of 2006.

     Cash used for investing activities totaled $214.0 million in the first nine months of 2007, compared with $140.4 million in the same period of 2006. In the first nine months of 2007, the Company paid $189.0 million for five business acquisitions and one small technology line, net of debt and other long — term liabilities assumed of $25.6 million and cash acquired. The Company paid $124.1 million for business and product line acquisitions in the first nine months of 2006, net of cash acquired. Additions to property, plant and equipment in the first nine months of 2007 totaled $24.5 million, compared with $18.2 million in the same period of 2006.

     Cash provided by financing activities totaled $52.6 million in the first nine months of 2007, compared with $6.9 million used in the same period of 2006. In the first nine months of 2007, the net total borrowings increased by $57.3 million, compared with a net total increase of $16.6 million in the first nine months of 2006.

     In the third quarter of 2007 the Company entered into a private placement to sell $450 million in Senior Notes to a group of institutional investors. The Notes will be issued on two delayed drawing dates. The first funding will occur in December 2007 for $370 million, consisting of $270 million in aggregate principal amount of 6.20% Senior Notes due December 2017 and $100 million in aggregate

AMETEK, Inc.

Financial Condition (continued)

principal amount of 6.30% Senior Notes due December 2019. The second funding date will be in July 2008 for $80 million in aggregate principal amount of 6.35% Senior Notes due July 2018. The Notes will carry a weighted-average interest rate of approximately 6.25%. The proceeds from the Notes will be used to fund the repayment of existing indebtedness, including redemption of the $225 million of 7.20% Senior Notes due July of 2008 and for general corporate purposes. The Notes are subject to certain customary covenants including certain financial covenants.

     In June 2007, the Company amended its Revolving Credit facility, increasing the total borrowing capacity from $400 million to $550 million, which includes an accordion feature that permits the Company to request up to an additional $100 million in revolving credit commitments at any time during the life of the revolving credit agreement under certain conditions. The amendment also extended the term of the revolver from October 2011 to June 2012. At September 30, 2007, the Company had $367.7 million available under its revolving credit facility, including the $100 million accordion feature.

     The accounts receivable securitization facility was amended and restated in May 2007, to increase the Company’s available borrowing capacity from $75 million to $110 million as well as extend the expiration date from May 2007 to May 2008. As of September 30, 2007, the Company had utilized $85 million under the accounts receivable securitization facility.

     Additional financing activities for the first nine months of 2007 include net cash proceeds from the exercise of employee stock options of $14.7 million compared with $6.9 million in the same period of 2006. Cash dividend payments were $19.2 million for the first nine months of 2007, compared with $12.6 million in the same period of 2006. The increase in dividends paid was the result of a Board of Directors approved 50% increase in the quarterly dividend rate on the Company’s common stock in the fourth quarter of 2006. Repurchases of the Company’s common stock in first nine months of 2007 totaled $5.4 million for approximately 144,000 shares, compared with a total of $21.1 million for 750,000 shares in the first nine months of 2006. As of September 30, 2007, $25.9 million was available under the current Board authorization for future share repurchases.

     At September 30, 2007, total debt outstanding was $780.3 million, compared with $681.9 million at December 31, 2006. The debt-to-capital ratio was 40.4% at September 30, 2007, compared with 41.4% at December 31, 2006.

     As a result of the activities discussed above, the Company’s cash and cash equivalents at September 30, 2007 totaled $72.6 million, compared with $49.1 million at December 31, 2006. The Company believes it has sufficient cash-generating capabilities, available credit facilities and access to long-term capital funds to enable it to meet its needs in the foreseeable future.

AMETEK, Inc.

Forward-looking Information

     Information contained in this discussion, other than historical information, is considered “forward-looking statements” and is subject to various factors and uncertainties that may cause actual results to differ significantly from expectations. These factors and uncertainties include our ability to consummate and successfully integrate future acquisitions; risks associated with international sales and operations; our ability to successfully develop new products, open new facilities or transfer product lines; the price and availability of raw materials; compliance with government regulations, including environmental regulations; changes in the competitive environment or the effects of competition in our markets; the ability to maintain adequate liquidity and financing sources; and general economic conditions affecting the industries we serve. A detailed discussion of these and other factors that may affect our future results is contained in AMETEK’s filings with the Securities and Exchange Commission, including its most recent reports on Form 10-K, 10-Q and 8-K. AMETEK disclaims any intention or obligation to update or revise any forward-looking statements, unless required by the securities laws to do so.

Item 4. Controls and Procedures

     The Company maintains a system of disclosure controls and procedures that is designed to provide reasonable assurance that information, which is required to be disclosed, is accumulated and communicated to management in a timely manner. The Company’s principal executive officer and principal financial officer evaluated the effectiveness of the system of disclosure controls and procedures as of September 30, 2007. Based on that evaluation, the Company’s principal executive officer and principal financial officer concluded that the Company’s disclosure controls and procedures are effective in all material respects as of September 30, 2007.

     Such evaluation did not identify any change in the Company’s internal control over financial reporting during the quarter ended September 30, 2007 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

AMETEK, Inc.

PART II. OTHER INFORMATION

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

     (c) Purchase of equity securities by the issuer and affiliated purchasers.

     The following table reflects purchases of AMETEK, Inc. common stock by the Company during the three months ended September 30, 2007:

										Total Number of
										Shares
										Purchased as				Approximate Dollar
		Total Number of								Part of Publicly				Value of Shares that
		Shares				Average Price				Announced Plan				May Yet Be Purchased
Period		Purchased (1)				Paid per Share				(2)				Under the Plan
July 1, 2007 to July 31, 2007			62,607			$	41.01				62,607			$	25,915,407
August 1, 2007 to August 31, 2007			—				—				—				25,915,407
September 1, 2007 to September 30, 2007			—				—				—				25,915,407
Total			62,607			$	41.01				62,607

Item 6. Exhibits

     a) Exhibits:

Exhibit
Number		Description
10.1		Amended and restated Supplemental Senior Executive Death Benefit Plan of AMETEK, Inc. dated as of July 25, 2007.
10.2		Amended and restated 2004 Executive Death Benefit Plan of AMETEK, Inc. dated as of July 25, 2007.
10.3		Amended and restated AMETEK, Inc. Directors’ Death Benefit Plan, dated as of October 24, 2007.
10.4		Amended and restated AMETEK, Inc. Retirement Plan for Directors, dated as of October 24, 2007.
10.5		Amended and restated AMETEK, Inc. Supplemental Executive Retirement Plan, dated as of October 24, 2007.
10.6		Amended and restated AMETEK, Inc. Deferred Compensation Plan, dated as of October 24, 2007.
10.7		Form of amended and restated Termination and Change of Control Agreement between the Company and a named executive, dated as of October 24, 2007.
10.8		Amended and restated Termination and Change of Control Agreement between the Company and a named executive, dated as of October 24, 2007.
10.9		Form of amended and restated Restricted Stock Agreement between the Company and certain executives of the Company, dated as of October 24, 2007.
31.1		Certification of Chief Executive Officer, Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2		Certification of Chief Financial Officer, Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1		Certification of Chief Executive Officer, Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2		Certification of Chief Financial Officer, Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

AMETEK, Inc.

SIGNATURES

     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.

November 2, 2007

 

 

AMETEK, INC.

SUPPLEMENTAL SENIOR EXECUTIVE DEATH BENEFIT PLAN

Effective January 1, 2005

 

 

TABLE OF CONTENTS

ARTICLE 1 .		PURPOSE AND EFFECTIVE DATE			1
1.01		Purpose			1
1.02		Effective Date			1
ARTICLE 2 .		DEFINITIONS AND CONSTRUCTION			2
2.01		Definitions			2
2.02		Construction			5
ARTICLE 3 .		ELIGIBILITY AND PARTICIPATION			6
3.01		Generally			6
3.02		Participation Agreement Required			6
ARTICLE 4 .		RETIREMENT BENEFIT			7
4.01		Nature of Benefit			7
4.02		Amount of Benefit			7
4.03		Vesting of Retirement Benefit			7
4.04		Forfeiture			7
ARTICLE 5 .		DEATH BENEFIT			8
5.01		Nature of Benefit			8
5.02		Amount of Benefit			8
5.03		Vesting of Death Benefit			8
5.04		Forfeiture			8
ARTICLE 6 .		PAYMENT OF PLAN BENEFITS			9
6.01		Timing of Benefit Payments			9
6.02		Form of Payment			9
6.03		Administrative Acceleration or Delay of Payment			11
6.04		Withholding			11
6.05		Payment to Guardian			11
6.06		Effect of Payment			11
ARTICLE 7 .		BENEFICIARY DESIGNATION			12
7.01		Beneficiary Designation			12
7.02		Changing Beneficiary			12
7.03		No Beneficiary Designation			12
ARTICLE 8 .		ADMINISTRATION			13
8.01		Committee; Duties			13
8.02		Agents			13
8.03		Binding Effect of Decisions			13
8.04		Indemnity of Committee			13

AMETEK, Inc. Supplemental Senior Executive Death Benefit Plan		Table of Contents

ARTICLE 9 .		CLAIMS PROCEDURE			14
9.01		Claim			14
9.02		Denial of Claim			14
9.03		Review of Claim			14
9.04		Final Decision			14
9.05		Claims for Disability Benefits			14
ARTICLE 10 .		AMENDMENT AND TERMINATION OF PLAN			15
10.01		Amendment			15
10.02		Company’s Right to Terminate			15
ARTICLE 11 .		MISCELLANEOUS			16
11.01		Company Obligation			16
11.02		Trust Fund			16
11.03		Nonassignability			16
11.04		Not a Contract of Employment			16
11.05		Governing Law			17
11.06		Severability			17
11.07		Headings			17
11.08		Notice			17
11.09		Successors			17

AMETEK, Inc. Supplemental Senior Executive Death Benefit Plan		Table of Contents

ARTICLE 1. PURPOSE AND EFFECTIVE DATE

1.01		Purpose.
		This AMETEK, Inc. Supplemental Senior Executive Death Benefit Plan (the “Plan”) is intended to provide an additional benefit to certain senior executives of AMETEK, Inc., and its subsidiaries (the “Company”), either in the form of a Retirement Benefit (as set forth in Article 4) or in the form of a Death Benefit (as set forth in Article 5), but not both. If a Participant retires from the Company after attaining early or normal retirement eligibility (or retires from the Company due to disability before attaining normal retirement eligibility and then attains normal retirement age), he will receive a Retirement Benefit determined in accordance with Article 4 of the Plan. In contrast, if a Participant dies while actively employed by the Company and is otherwise eligible to participate in the Plan (or after retiring due to disability but before attaining eligibility for normal retirement), his Beneficiary(ies) will receive a Death Benefit determined in accordance with Article 5 of the Plan.
		The Retirement Benefit and the Death Benefit are mutually exclusive: no Death Benefit will be paid on behalf of a Participant who receives a Retirement Benefit, and no Retirement Benefit will be paid on behalf of a Participant if a Death Benefit is paid on that Participant’s behalf. A Participant who terminates employment (not on account of his death or disability) before attaining early or normal retirement eligibility will not receive any benefit under the Plan and no Plan benefit will be paid on his behalf.

1.02

Effective Date.

	(a)		The Plan, as hereby amended and restated, is effective January 1, 2005.
	(b)		This Plan restatement is effective with respect to the entire benefit of a Participant if the Participant Separates from Service after December 31, 2004.
	(c)		If a Participant Separated from Service before January 1, 2005, and had not received his entire benefit as of that date, the Participant’s Retirement Benefit and Death Benefit shall be subject to the terms of this restatement, except that the maximum Retirement Benefit amount under Section 4.02(b) and the maximum Death Benefit amount under Section 5.02(b) shall equal the maximum amounts set forth in paragraphs Second and First, respectively, of the Participant’s participation agreement under the 1992 restatement of the Plan, as amended. These changes are permitted under the terms of the 1992 restatement of the Plan because they are being made to all participation agreements and do not reduce the value of a Participant’s Retirement Benefit or Death Benefit.
	(d)		This amendment and restatement of the Plan is not intended to constitute a “material modification” for purposes of section 409A of the Code with respect to the benefit of a Participant (and earnings on such benefit), which was earned and vested (within the meaning of section 409A of the Code) before January 1, 2005. However, the Company shall not be liable for any adverse tax consequence suffered by a Participant or Beneficiary if a Participant’s benefit becomes subject to section 409A of the Code.

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ARTICLE 2. DEFINITIONS AND CONSTRUCTION

2.01		Definitions.
		As used in the Plan, the following words and phrases shall have the meaning set forth below:

	(a)		Annual Salary. “Annual Salary” means a Participant’s salary, not including bonuses or imputed income, paid by the Company for a calendar year.
	(b)		Beneficiary. “Beneficiary” means the person, persons or entity as designated by the Participant, entitled under Article 7 to receive any Plan benefits payable after the Participant’s death.
	(c)		Board. “Board” means the Board of Directors of AMETEK, Inc.
	(d)		Cause. “Cause” means (1) misappropriation of funds, (2) habitual insobriety or substance abuse, (3) conviction of a felony or crime involving moral turpitude, or (4) gross negligence in the performance of duties, which gross negligence has had a material adverse effect on the business, operations, assets, properties, or financial condition of the Company.
	(e)		Change in Control. A “Change in Control” shall occur if:

	(1)		Any one person or more than one person acting as a group (as defined in section 1.409A-3(i)(5)(v)(B) of the Treasury Regulations) acquires ownership of stock of the Company that, together with the stock held by such person or group of persons, constitutes more than 50 percent of the total fair market value or total voting power of the stock of the Company. However, if such person or group of persons is considered to own more than 50 percent of the total fair market value or total voting power of the stock of the Company before this transfer of the Company’s stock, the acquisition of additional stock by the same person or group of persons shall not be considered to cause a Change in Control of the Company; or
	(2)		Any one person or more than one person acting as a group (as defined in section 1.409A-3(i)(5)(v)(B) of the Treasury Regulations) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or group of persons) ownership of stock of the Company possessing 30 percent or more of the total voting power of the stock of the Company. However, if such person or group of persons is considered to own 30 percent or more of the total voting power of the stock of the Company before this acquisition, the acquisition of additional control or stock of the Company by the same person or group of persons shall not cause a Change in Control of the Company; or
	(3)		A majority of members of the Company’s Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Company’s Board before the date of the appointment or election; or

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(4)

Any one person or more than one person acting as a group (as defined in section 1.409A-3(i)(5)(v)(B) of the Treasury Regulations) acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or group of persons) assets from the Company that have a total gross fair market value equal to substantially all but in no event less than 40 percent of the total fair market value of all assets of the Company immediately prior to such acquisition or acquisitions. For this purpose, gross fair market value means the value of the assets of the Company, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets. A transfer of assets by the Company will not result in a Change in Control under this Section 2.01(e)(4), if the assets are transferred to:

	(A)		A shareholder of the Company (immediately before the asset transfer) in exchange for or with respect to its stock;
	(B)		An entity, 50 percent or more of the total value or voting power of which is owned, directly or indirectly, by the Company immediately after the transfer of assets;
	(C)		A person or more than one person acting as a group (as defined in section 1.409A-3(i)(5)(v)(B) of the Treasury Regulations) that owns, directly or indirectly, 50 percent or more of the total value or voting power of all the outstanding stock of the Company; or
	(D)		An entity, at least 50 percent of the total value or voting power of which is owned directly or indirectly, by a person described in Section 2.01(e)(4)(C), above.

			For purposes of this Section 2.01(e), no acquisition, either directly or indirectly, by the Participant, his affiliates and associates, the Company, any subsidiary of the Company, any employee benefit plan of the Company or of any subsidiary of the Company, or any person or entity organized, appointed or established by the Company for or pursuant to the terms of any such employee benefit plan shall constitute a Change in Control.
	(f)		Code. “Code” means the Internal Revenue Code of 1986, as amended.
	(g)		Committee. “Committee” means the Committee appointed by the Board (or its delegee) to administer the Plan pursuant to Article 8.
	(h)		Company. “Company” means AMETEK, Inc., a Delaware corporation.
	(i)		Death Benefit. “Death Benefit” means the benefit paid on behalf of a Participant in accordance with Article 5.
	(j)		Deferred Retirement. “Deferred Retirement” means Separation from Service by the Participant after attaining age 70.
	(k)		Disability. “Disability” means a medically determinable physical or mental impairment which can be expected to result in death or can be expected to last

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			for a continuous period of not less than twelve (12) months that (1) renders a Participant unable to engage in any substantial gainful activity or (2) results in a Participant receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Company. The Committee shall determine the existence of Disability, in its sole discretion, and may rely on advice from a medical examiner satisfactory to the Committee in making the determination. A Participant will also be considered disabled if he has been determined to be totally disabled by the Social Security Administration. The term “Disability” is intended to comply with section 409A(a)(2)(C) of the Code and shall be interpreted to permit a Participant to take a distribution in any circumstance that would be permitted under section 409A(a)(2)(C) of the Code.
	(l)		Early Retirement. “Early Retirement” means Separation from Service by the Participant after attaining age fifty-five (55) with at least five (5) Years of Service and before attaining age sixty-five (65).
	(m)		Effective Date. “Effective Date” means January 1, 2005.
	(n)		Eligible Executive. “Eligible Executive” means an Employee in the select group of management or highly compensated senior executives of the Company whom the Board designates as eligible to participate in the Plan.
	(o)		Employee. “Employee” means any individual, except any non-resident alien, employed on a regular basis by the Company; provided, however, that any leased employee within the meaning of section 414(n)(2) of the Code shall not be included.
	(p)		ERISA. “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
	(q)		Normal Retirement. “Normal Retirement” means Separation from Service by the Participant on or after attaining age sixty-five (65) and before attaining age seventy (70).
	(r)		Optional Form. “Optional Form” means one of the following forms of payment:

	(1)		Lump Sum. This Optional Form is payable in one lump sum on the commencement date specified in Section 6.01(a)
	(2)		Installments. This Optional Form of benefit is payable monthly to the Participant for the number of periods designated by the Participant. A Participant may not elect a number of installment payments that results in payments being made beyond the date on which the Participant attains age 85.
	(3)		Life Annuity. This Optional Form of benefit is payable monthly to the Participant for life.
	(4)		Life Annuity with 120 or 60 Payments Guaranteed. This Optional Form of benefit is payable monthly to the Participant for life with the first one

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hundred twenty (120) or sixty (60) monthly payment guaranteed, as elected by the Participant. A Participant may not elect a period of guaranteed payments that exceeds the Participant’s remaining life expectancy at the time of the election.

	(s)		Participant. “Participant” means any Eligible Executive who is eligible and has become a participant pursuant to Article 3. Such employee shall remain a Participant in this Plan until such time as all benefits payable under this Plan have been paid in accordance with the provisions hereof.
	(t)		Participation Agreement. “Participation Agreement” shall mean any of the agreements entered into by the Company and any Participant in accordance with Section 3.02.
	(u)		Plan. “Plan” means the AMETEK, Inc. Supplemental Senior Executive Death Benefit Plan.
	(v)		Plan Year. “Plan Year” means the calendar year.
	(w)		Retirement Benefit. “Retirement Benefit” means the benefit payable to a Participant at Early Retirement, Normal Retirement or Deferred Retirement under Article 4.
	(x)		Separation from Service. “Separation from Service” or “Separates from Service” means separation from service within the meaning of section 409A of the Code.
	(y)		Year of Service. “Year of Service” means the 12-month period following the date that the Participant first performs an hour of service for the Company and each consecutive 12-month period following the anniversary of that date that is completed before the Participant Separates from Service.

2.02		Construction.
		For purposes of the Plan, unless the contrary is clearly indicated by the context,

	(a)		the use of the masculine gender shall also include within its meaning the feminine and vice versa,
	(b)		the use of the singular shall also include within its meaning the plural and vice versa, and
	(c)		the word “include” shall mean to include without limitation.

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ARTICLE 3. ELIGIBILITY AND PARTICIPATION

3.01

Generally.

	(a)		If an Eligible Executive is a Participant on the Effective Date and his benefit is subject to the terms of this restatement in accordance with Section 1.02(b), the Eligible Executive will remain a Participant if he executes a new Participation Agreement; if the Eligible Executive fails to execute a new Participation Agreement, he shall cease being a Participant as of the Effective Date.
	(b)		If an Employee is designated an Eligible Executive on or after the Effective Date, the Eligible Executive will become a Participant when he properly executes a Participation Agreement.

3.02

Participation Agreement Required.

	(a)		No Eligible Executive under Sections 3.01(a) or 3.01(b) will be eligible to be a Participant in the Plan unless he and the Company execute a Participation Agreement evidencing his participation in the Plan. The executed Participation Agreement will constitute an agreement between the Company and the Eligible Executive that binds both of them to the terms of the Plan and will bind their heirs, executors, administrators, successors, and assigns, both present and future.
	(b)		In the case of an Eligible Executive described under Section 3.01(a), the executed Participation Agreement will also constitute the Eligible Executive’s written agreement to waive all rights he may have under any earlier restatement of the Plan or agreement under the Plan.

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ARTICLE 4. RETIREMENT BENEFIT

4.01		Nature of Benefit.
		A Participant’s Retirement Benefit shall be a lump sum or a series of installment or annuity payments that are payable if a Participant Separates from Service (a) pursuant to an Early Retirement, Normal Retirement, or Deferred Retirement or (b) before Normal Retirement as a result of Disability and then attains age 65.
		The Retirement Benefit under the Plan is mutually exclusive with the Death Benefit under the Plan (which is described in Article 5). No Retirement Benefit shall be paid to or on behalf of any Participant if a Death Benefit has been or will be paid on behalf of such Participant.

4.02		Amount of Benefit.
		The Retirement Benefit shall be an annual amount (or the actuarial equivalent of an annual amount) equal to one tenth of the lesser of:

	(a)		two times the Participant’s average Annual Salary received from the Company during the five consecutive calendar years immediately preceding the calendar year of the Participant’s Separation from Service in accordance with Section 6.01(a), the product of which shall be rounded off to the next highest multiple of $50,000; or
	(b)		the maximum Retirement Benefit amount set forth in the Participant’s Participation Agreement.

4.03		Vesting of Retirement Benefit.
		Each Participant shall become 100% vested in his Retirement Benefit upon (a) Separation from Service pursuant to either an Early Retirement, Normal Retirement, or Deferred Retirement or (b) attaining age 65 after Separating from Service as a result of a Disability before Normal Retirement.

4.04

Forfeiture.

	(a)		Any portion of a Participant’s Retirement Benefit that does not vest in accordance with Section 4.03 shall be forfeited on the date the Participant Separates from Service or dies, whichever occurs earlier, except that a Participant who has a Disability shall not forfeit his Retirement Benefit before Normal Retirement.
	(b)		The Participant’s entire Retirement Benefit shall be forfeited if a Death Benefit becomes payable on the Participant’s behalf in accordance with Article 5.
	(c)		The Committee may cause a forfeiture with respect to all or any portion of the Participant’s Retirement Benefit (whether or not vested) if the Committee determines that the Participant’s employment has been terminated for Cause.

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ARTICLE 5. DEATH BENEFIT

5.01		Nature of Benefit.
		A Participant’s Death Benefit under the Plan shall be a series of equal monthly installment payments that are payable if the Participant dies (a) while actively employed by the Company or (b) before he becomes eligible for Normal Retirement if he Separates from Service on account of a Disability.
		The Death Benefit under the Plan is mutually exclusive with the Retirement Benefit under the Plan (as described in Article 4). No Death Benefit shall be paid on behalf of any Participant if a Retirement Benefit has been or will be paid to or on behalf of such Participant.

5.02		Amount of Benefit.
		The Death Benefit shall be an annual amount equal to one tenth of the lesser of:

	(a)		two times the Participant’s average Annual Salary received from the Company during the five consecutive calendar years immediately preceding the calendar year of the Participant’s death rounded off to the next highest multiple of $50,000; or
	(b)		the maximum Death Benefit amount set forth in the Participant’s Participation Agreement.

5.03		Vesting of Death Benefit.
		Each Participant shall become 100% vested in his Death Benefit upon his death (a) while actively employed by the Company or (b) before reaching eligibility for Normal Retirement if the Participant Separates from Service as a result of a Disability.

5.04

Forfeiture.

	(a)		Any portion of a Participant’s Death Benefit that does not vest in accordance with Section 5.03 shall be forfeited on the date the Participant Separates from Service or dies, whichever occurs earlier.
	(b)		The Participant’s entire Death Benefit shall be forfeited if a Retirement Benefit becomes payable on the Participant’s behalf in accordance with Article 4.

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ARTICLE 6. PAYMENT OF PLAN BENEFITS

6.01

Timing of Benefit Payments.

(a)

Retirement Benefit.

	(1)		Early or Normal Retirement. A Participant who Separates from Service pursuant to an Early Retirement or a Normal Retirement shall receive or shall begin receiving the Retirement Benefit on the first day of the month coincident with or next following the earlier of (A) the date of the Participant’s death or (B) the date that the Participant attains age 70.
	(2)		Deferred Retirement. A Participant who Separates from Service pursuant to a Deferred Retirement shall receive or shall begin receiving the Retirement Benefit on the first day of the month coincident with or next following the date that is six (6) months after the date of the Participant’s Separation from Service, provided that if the Participant dies after Separation from Service and before the date that is six (6) months after the date of the Participant’s Separation from Service, the Retirement Benefit shall be paid on the first day of the month coincident with or next following the date of the Participant’s death.
	(3)		Disability. A Participant who Separates from Service due to Disability before he is eligible for Normal Retirement shall receive or shall begin receiving the Retirement Benefit on the first day of the month coincident or next following the date he attains age 65.

	(b)		Death Benefit.
			The Death Benefit payable on behalf of a Participant shall begin to be paid on the first day of the month coincident with or next following the date on which the Participant dies.

6.02

Form of Payment.

(a)

Retirement Benefit.

	(1)		General. The Retirement Benefit payable to any Participant shall be paid in equal monthly installments for ten years unless the Participant makes a valid election, in accordance with subsections (2), (3), or (4), below, to receive his Retirement Benefit in an Optional Form. The most recently filed election that meets the requirements of subsections (2), (3), or (4) below, shall be effective.
	(2)		Initial Election Regarding Form of Payment.

(A)

Normal Rule. A Participant may elect an Optional Form by making such election before the expiration of thirty (30) days from the date he first becomes eligible to participate in the Plan, provided that he has not, within the preceding twenty-four (24) months, been eligible to participate in any other non-account-

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			based deferred compensation arrangement of the Company (within the meaning of section 409A of the Code).
	(B)		One-Time Election Before January 1, 2008. A Participant may make a special election of any Optional Form (or may revoke any prior election) before January 1, 2008; provided, however, that the Participant may not make a new election under this paragraph after December 31, 2006, if (1) all or any portion of his Retirement Benefit would otherwise be paid during 2007 or (2) the election would accelerate payment of all or a portion of his Retirement Benefit into 2007; and provided, further, that the election satisfies Sections 6.02(a)(4)(D) and (E), below. The Participant must elect the same time and form of distribution for his entire Retirement Benefit.

	(3)		Election Between Life Annuities. A Participant may file an election to receive an Optional Form that is an annuity at any time before the first annuity payment is made, provided that (A) the Participant’s existing election is an annuity and (B) both the annuity payable under the existing election and the annuity payable under the new election are considered “life annuities” for purposes of section 409A of the Code.
	(4)		Modification of Election. If a Participant wishes to change the form of payment for his Retirement Benefit, and the new election does not satisfy the requirements of Section 6.02(a)(2)(B) (concerning elections before January 1, 2008) or Section 6.02(a)(3) (concerning elections between life annuities), the Participant’s new payment election must satisfy the requirements of this Section 6.02(a)(4). A Participant may change his election under this Section 6.02(a)(4) only if the new election —

	(A)		is not effective until at least twelve (12) months after the date on which the election is made;
	(B)		defers the first payment with respect to which such election is made for a period of not less than five (5) years from the date such payment would otherwise have been made;
	(C)		is not made less than twelve (12) months before the Retirement Benefit would otherwise commence or be paid under Section 6.01;
	(D)		does not result in the Participant’s Retirement Benefit commencing after the later of (A) the Participant’s Separation from Service or (B) the Participant’s attaining age 75; and
	(E)		does not result in any part of a Participant’s Retirement Benefit being paid after the earlier of (A) the fifteenth (15th) year after the Participant’s Separation from Service or (B) the Participant’s attaining age 85.

(5)

Optional Forms are Actuarially Equivalent. In all instances, the Retirement Benefit payable under this Section 6.02 shall be the actuarial

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			equivalent of the Retirement Benefit determined under Section 4.02. Actuarial equivalence shall be determined using reasonable actuarial factors determined by the Committee to be appropriate for this purpose.
	(6)		Continued Payment of Retirement Benefit After Participant’s Death. If the Participant dies after his retirement under this Plan and before his Retirement Benefit is paid in full (and the Participant has not chosen to have his Retirement Benefit paid as an annuity without guaranteed payments), the Company shall pay to the Participant’s Beneficiaries any remaining amounts at the same time and in the same manner as if the Participant had survived.

	(b)		Death Benefit.
			The Death Benefit payable on behalf of any Participant shall be paid in equal monthly installments that begin as provided in Section 6.01(b) and end in the month in which the Participant would have attained age 80.

6.03		Administrative Acceleration or Delay of Payment.
		A payment is treated as being made on the date when it is due under the Plan if the payment is made (a) no earlier than thirty (30) days before the due date specified by the Plan or (b) on a date later than the due date specified by the Plan that is either (1) in the same Plan Year (for a payment whose specified due date is on or before September 30) or (2) by the fifteenth (15th) day of the third calendar month following the date specified by the Plan (for a payment whose specified due date is on or after October 1).

6.04		Withholding.
		The Company shall withhold from any payment made pursuant to this Plan any taxes the Company reasonably believes are required to be withheld from such payments under local, state, or federal law.

6.05		Payment to Guardian.
		If a Plan benefit is payable to a minor or a person declared incompetent or to a person incapable of handling the disposition of the property, the Committee may direct payment to the guardian, legal representative or person having the care and custody of such minor, incompetent or person. The Committee may require proof of incompetency, minority, incapacity or guardianship as it may deem appropriate prior to distribution. Such distribution shall completely discharge the Committee and Company from all liability with respect to such benefit.
6.06		Effect of Payment.
		The full payment of the applicable benefit under this Article 6 shall completely discharge all obligations on the part of the Company to the Participant (and the Participant’s Beneficiary) with respect to the operation of this Plan, and the Participant’s (and Participant’s Beneficiary’s) rights under this Plan shall terminate.

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ARTICLE 7. BENEFICIARY DESIGNATION

7.01		Beneficiary Designation.
		Each Participant shall have the right, at any time, to designate one (1) or more persons or entity as Beneficiary (both primary as well as secondary) to whom benefits under this Plan shall be paid in the event of the Participant’s death. Each Beneficiary designation shall be in a written form prescribed by the Committee and shall be effective only when filed with the Committee during the Participant’s lifetime.
7.02		Changing Beneficiary.
		Any Beneficiary designation may be changed without the consent of the previously named Beneficiary by the filing of a new Beneficiary designation with the Committee during the Participant’s lifetime.
7.03		No Beneficiary Designation.
		If any Participant fails to designate a Beneficiary in the manner provided above, if the designation is void, or if the Beneficiary designated by a deceased Participant dies before the Participant or before complete distribution of the Participant’s benefits, the Participant’s Beneficiary shall be the person in the first of the following classes in which there is a survivor:

	(a)		the Participant’s surviving spouse;
	(b)		the Participant’s children in equal shares, except that if any of the children predeceases the Participant but leaves surviving issue, then such issue shall take by right of representation the share the deceased child would have taken if living; or
	(c)		the Participant’s estate.

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ARTICLE 8. ADMINISTRATION

8.01		Committee; Duties.
		This Plan shall be administered by the Committee, which shall consist of not less than three (3) persons, who may also be Participants in this Plan, and are named as the initial Committee in this Plan or as subsequently appointed by the Board or its delegee. The Committee shall have the full discretionary authority to (a) make, amend, interpret and enforce all appropriate rules and regulations for the administration of the Plan and decide or resolve any and all questions, including interpretations of the Plan, as they may arise in such administration, and (b) establish and maintain an investment policy, select appropriate investment options to implement the investment policy, monitor the performance of such investment options, and change the selection of investment options from time to time in a manner consistent with the objectives of the investment policy. A Committee member who is also a Participant in this Plan shall be prohibited from voting on any matter which may, in the opinion of the balance of the Committee, directly affect the Committee member’s rights or benefits under this Plan. A majority vote of the Committee members permitted to vote shall control any decision.
8.02		Agents.
		The Committee may, from time to time, employ agents and delegate to them such administrative duties as it sees fit, and may from time to time consult with counsel who may be counsel to the Company.
8.03		Binding Effect of Decisions.
		The decision or action of the Committee with respect to any question arising out of or in connection with the administration, interpretation and application of the Plan and the rules and regulations promulgated hereunder shall be final, conclusive and binding upon all persons having any interest in the Plan.
8.04		Indemnity of Committee.
		The Company shall indemnify and hold harmless the members of the Committee against any and all claims, loss, damage, expense (including counsel fees) or liability (including any amounts paid in settlement of any claim or any other matter with the consent of the Board) arising from any action or failure to act with respect to this Plan on account of such member’s service on the Committee, except in the case of gross negligence or willful misconduct.

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ARTICLE 9 . CLAIMS PROCEDURE

9.01 Claim.
		Any person or entity claiming a benefit under the Plan (hereinafter referred to as “Claimant”) shall present the request in writing to the Corporate Human Resources Department, which shall respond in writing as soon as practical, but not later than ninety (90) days after receipt of the claim, unless the Corporate Human Resources Department notifies the Claimant that special circumstances require an additional period of time (not to exceed 90 days) to review the claim properly.
9.02		Denial of Claim.
		If the claim or request is denied, the written notice of denial shall state:

	(a)		the reasons for denial, with specific reference to the Plan provisions on which the denial is based;
	(b)		a description of any additional material or information required and an explanation of why it is necessary; and
	(c)		an explanation of the Plan’s claim review procedure, including a statement of the Claimant’s right to bring a civil action under section 502(a) of ERISA if the claim denial is denied (in whole or in part) on appeal.

9.03		Review of Claim.
		Any Claimant whose claim or request is denied or who has not received a response within the time limits set forth above may request a review by notice given in writing to the Committee. Such request must be made within sixty (60) days after receipt by the Claimant of the written notice of denial, or, in the event Claimant has not received a timely response, within 60 days after the date the Corporate Human Resources Department was required to respond to the claim under Section 9.01. The claim or request shall be reviewed by the Committee which may, but shall not be required to, grant the Claimant a hearing. On review, the claimant may have representation, examine pertinent documents, and submit issues and comments in writing.
9.04		Final Decision.
		The decision on review shall normally be made within sixty (60) days after the Committee’s receipt of claimant’s claim or request. If an extension of time is required for a hearing or other special circumstances, the Claimant shall be notified and the time limit shall be one hundred twenty (120) days. The decision shall be in writing and shall state the reasons and the relevant Plan provisions. All decisions on review shall be final and bind all parties concerned.
9.05		Claims for Disability Benefits.
		To the extent required by law, the Committee shall develop alternative claims procedures that shall apply with respect to claims for Disability benefits.

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ARTICLE 10. AMENDMENT AND TERMINATION OF PLAN

10.01		Amendment.
		The Committee may at any time amend the Plan by written instrument executed by or on behalf of all Committee members, notice of which shall be given to all Participants and to any Beneficiary receiving installment payments, except that no amendment shall reduce the amount of any Retirement Benefit or Death Benefit that is vested in accordance with Sections 4.03 or 5.03, respectively, as of the date such notice of the amendment is given.
10.02		Company’s Right to Terminate.
		The Committee may at any time partially or completely terminate the Plan. Any termination of the Plan must be made by written instrument executed by the Committee and approved by the Board. In the event of complete termination, the Plan shall cease to operate and the Company shall distribute the Retirement Benefit or Death Benefit to the appropriate Participant or Beneficiary in accordance with Article 6.

AMETEK, Inc. Supplemental Senior Executive Death Benefit Plan		Page 15

ARTICLE 11. MISCELLANEOUS

11.01		Company Obligation.
		The Company shall not be required to fund any obligations under the Plan. Except as provided in Section 11.02, any assets that may be accumulated by the Company to meet its obligations under the Plan shall for all purposes be part of the general assets of the Company. To the extent that any Participant or Beneficiary acquires a right to receive payments under the Plan for which the Company is liable, such rights shall be no greater than the rights of any unsecured general creditor of the Company.
11.02		Trust Fund.
		The Company shall be responsible for the payment of all benefits provided under the Plan. Before a Change in Control, at its discretion, the Company may establish one (1) or more trusts, with such trustees as the Committee may approve, for the purpose of assisting in the payment of such benefits. Following a Change in Control, the Company shall establish one (1) or more trusts, with such trustees as the Committee may approve, for the purpose of assisting in the payment of such benefits, and shall fund such trust with the full amount necessary to pay all benefits that are reasonably expected to be payable under the Plan. Although such a trust may be irrevocable, its assets shall be held for payment of all of the Company’s general creditors in the event of insolvency and shall not be located or transferred outside the United States. To the extent any benefits provided under the Plan are paid from any such trust, the Company shall have no further obligation to pay them. If not paid from the trust, such benefits shall remain the obligation of Company. No assets of the trust or the Company shall become restricted to provide benefits under the Plan in connection with a change in the Company’s financial health.
11.03		Nonassignability.
		Neither a Participant nor any other person shall have any right to commute, sell, assign, transfer, pledge, anticipate, mortgage or otherwise encumber, transfer, hypothecate or convey in advance of actual receipt the amounts, if any, payable hereunder, or any part thereof, which are, and all rights to which are, expressly declared to be unassignable and non-transferable. No part of the amounts payable shall, prior to actual payment, be subject to seizure or sequestration for the payment of any debts, judgments, alimony or separate maintenance owed by a Participant or any other person, nor be transferable by operation of law in the event of a Participant’s or any other person’s bankruptcy or insolvency, except that the Committee may recognize a domestic relations order in accordance with procedures that it may establish for this purpose.
11.04		Not a Contract of Employment.
		This Plan shall not constitute a contract of employment between the Company and the Participant. Nothing in this Plan shall give a Participant the right to be retained in the service of the Company or to interfere with the right of the Company to discipline or discharge a Participant at any time.

AMETEK, Inc. Supplemental Senior Executive Death Benefit Plan		page 16

11.05		Governing Law.
		The Plan shall be construed and enforced in accordance with applicable federal law and, to the extent not preempted by federal law, the laws of the Commonwealth of Pennsylvania (without regard to the legislative or judicial conflict of laws rules of any state or other jurisdiction).
11.06		Severability.
		If any provision of the Plan shall be held unlawful or otherwise invalid or unenforceable in whole or in part, the unlawfulness, invalidity, or unenforceability shall not affect any other provision of the Plan or part thereof, each of which shall remain in full force and effect. In addition, if any provision of the Plan shall be found to violate section 409A of the Code or otherwise result in benefits under the Plan being subject to income tax prior to distribution, such provision shall be void and unenforceable, and the Plan shall be administered without regard to such provision.
11.07		Headings.
		Headings are inserted in this Plan for convenience of reference only and are to be ignored in the construction of the provisions of the Plan.
11.08		Notice.
		Any notice required or permitted under the Plan shall be sufficient if in writing and hand delivered or sent by registered mail, certified mail, or reputable overnight delivery service. Such notice shall be deemed given as of the date of delivery or, if delivery is made by mail or overnight delivery, as of the date shown on the postmark on the receipt for registration or certification or on the records of the overnight delivery company. Mailed notice to the Committee shall be directed to the Company’s address. Mailed notice to a Participant or Beneficiary shall be directed to the individual’s last known address in Company’s records.
11.09		Successors.
		The provisions of this Plan shall bind and inure to the benefit of Company and its successors and assigns. The term successors as used herein shall include any corporate or other business entity which shall, whether by merger, consolidation, purchase or otherwise acquire all or substantially all of the business and assets of Company, and successors of any such corporation or other business entity.

		AMETEK, INC.
		BY:		/s/ Henry J. Policare
		BY:		Henry J. Policare
		DATED:         11/1/07

		ATTEST
		BY:		/s/ Kathryn E. Sena
				Kathryn E. Sena
				Corporate Secretary

AMETEK, Inc. Supplemental Senior Executive Death Benefit Plan		page 17

 

 

AMETEK, INC.
2004 EXECUTIVE DEATH BENEFIT PLAN

Amended and Restated Effective January 1, 2005

 

 

TABLE OF CONTENTS

Article 1. Purpose and Effective Date						1
1.01.				Purpose		1
1.02.				Effective Date		1
Article 2. Definitions and Construction						2
2.01.				Definitions		2
2.02.				Construction		5
Article 3. Eligibility and Participation						6
3.01.				Eligibility and Participation		6
3.02.				Change in Employment Status		6
Article 4. Retirement Benefit						7
4.01.				Nature of Benefit		7
4.02.				Accounts		7
4.03.				Timing of Credits; Withholding		9
4.04.				Vesting of Accounts		9
4.05.				Forfeiture		9
4.06.				Statement of Accounts		9
Article 5. Death Benefit						10
5.01.				Nature of Benefit		10
5.02.				Benefit Amounts		10
5.03.				Vesting of Death Benefit		10
5.04.				Forfeiture		10
Article 6. Payment of Plan Benefits						11
6.01.				Timing of Benefit Payments		11
6.02.				Form of Payment		12
6.03.				Administrative Acceleration or Delay of Payment		12
6.04.				Withholding		13
6.05.				Payment to Guardian		13
6.06.				Effect of Payment		13
Article 7. Beneficiary Designation						14
7.01.				Beneficiary Designation		14
7.02.				Changing Beneficiary		14
7.03.				No Beneficiary Designation		14