##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-K
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2007
 or
 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: 1-16239
 ATMI, Inc.
 
  Delaware
    
    06-1481060(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. Employer Identification No.)7 Commerce Drive, Danbury, CT
    
    06810(Address of principal executive offices)
    
    (Zip Code)
  
   Name of each exchangeTitle of each class
    
    on which registeredCommon Stock, par value $0.01 per share
    
    The NASDAQ Stock Market LLC
(NASDAQ Global Select Market)
   
  þ o
 o þ
 þ o
 o
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ
   DOCUMENTS INCORPORATED BY REFERENCE




---



##### 



ATMI, INC.
Annual Report on Form 10-K
For the Fiscal Year Ended December 31, 2007
 TABLE OF CONTENTS
 PagePart IItem 1.
    
    Business
    
    
    3Item 1A.
    
    Risk Factors
    
    
    16Item 1B.
    
    Unresolved Staff Comments
    
    
    20Item 2.
    
    Properties
    
    
    20Item 3.
    
    Legal Proceedings
    
    
    21Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    21Part IIItem 5.
    
    Market for Registrants Common Equity, Related Stockholder Matters
and Issuer Purchases of Equity Securities
    
    
    23Item 6.
    
    Selected Financial Data
    
    
    25Item 7.
    
    Managements Discussion and Analysis of Financial
Condition and Results of Operations
    
    
    27Item 7A.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    38Item 8.
    
    Financial Statements and Supplementary Data
    
    
    39Item 9.
    
    Changes in and Disagreements With Accountants on
Accounting and Financial Disclosure
    
    
    39Item 9A.
    
    Controls and Procedures
    
    
    39Item 9B.
    
    Other Information
    
    
    40Part III
    
    
    
    
    41Part IVItem 15.
    
    Exhibits and Financial Statement Schedule
    
    
    41Signatures
    
    
    
    
    46Index to Consolidated Financial Statements and Financial Statement Schedule
    
    
    F-1EX-10.30: AGREEMENT AND PLAN OF MERGEREX-10.31: EMPLOYMENT AGREEMENT: CARLSONEX-10.32: AMENDMENT TO EMPLOYMENT AGREEMENT: CARLSONEX-10.33: EMPLOYMENT AGREEMENT: HARMONEX-10.34: AMENDMENT TO EMPLOYMENT AGREEMENT: CARLSONEX-10.35: AMENDMENT TO EMPLOYMENT AGREEMENT: SHARKEYEX-21: SUBSIDIARIESEX-23: CONSENT OF ERNST & YOUNG LLPEX-31.1: CERTIFICATIONEX-31.2: CERTIFICATIONEX-32: CERTIFICATION




---



##### Table of Contents



PART I
  
 Item 1. Business
  
    
    knowledge of the science and economics of process applications for customer needs in
markets served;
    
    the materials science of packaging, delivery, and deposition of ultra-pure materials;
and
    
    the ability to rapidly develop innovative technology and intellectual property that
strengthens competitive position.
  
    
    an extensive research and development program that has produced a stream of proprietary
and patented products for this market;
    
    a key customer focus, which has included providing applications development in order to
offer materials solutions for future generation technologies;
    
    a strategy of leveraging the combination of our performance materials and materials
handling portfolio to provide greater process efficiency value to our customers; and
    
    strategic alliances and collaboration efforts that have allowed us to add complementary
technologies to our product portfolio more rapidly than through internal development.
     3




---



##### Table of Contents



2007 Organizational Realignment
       Semiconductor Industry Background
  
    
    consistently enhanced performance characteristics and functionality;
    
    improved reliability;
    
    reduced size, weight, power consumption and cost; and
    
    shorter product development cycles.
  4




---



##### Table of Contents



Semiconductor Manufacturing Process
      
    
    the relative thinness of the films applied to the wafer;
    
    conformality (ability to coat evenly, especially in three-dimensional holes and trenches
designed into the device);
    
    purity; and
    
    the ability to coat large areas.
   5




---



##### Table of Contents



Flat-Panel Industry Background
  
    
    consumer affordability through manufacturing and materials cost efficiencies;
    
    improved performance and reliability; and
    
    shorter product development cycles.
  6




---



##### Table of Contents



Flat-Panel Manufacturing Process
  Life Sciences Industry Background
   Life Sciences Manufacturing Process
  ATMIs Strategy
 the source of process efficiency solutions
 
    
    Focus development and application engineering initiatives with the leading
microelectronic manufacturers to provide next generation performance materials and process
solutions.
    
    Target high-growth, high-margin specialty markets that use ATMIs core materials
technologies and require products that are consumed in the production process.
    
    Add value through performance materials packaging, dispense, and process technologies
designed to meet the demands of users for greater levels of purity, productivity, safety,
environmental responsiveness, and speed.
 7




---



##### Table of Contents




    
    Leverage ATMIs technology leadership by investing extensively in developing proprietary
and patented materials and process solutions, which the Company uses to quickly
commercialize new offerings for customers.
    
    Form strategic alliances, including joint development programs and collaborative
marketing efforts, to accelerate the introduction of ATMIs products into markets that ATMI
does not currently serve.
  Products
  
    
    developing and commercializing a broad range of front-end semiconductor performance
materials;
    
    developing and commercializing sub-atmospheric pressure gas delivery systems for safe
handling and delivery of toxic and hazardous gases to semiconductor process equipment;
    
    developing and commercializing innovative high-purity materials packaging and dispensing
systems that allow for the reliable introduction of low volatility liquids and solids to
semiconductor processes; and
    
    developing manufacturing processes to meet the critical purity and integrity
requirements of the microelectronics manufacturers.
  
    
    maintain intimate relations with its customers in order to quickly understand their
needs and issues;
    
    offer a complete line of performance materials, and related materials packaging,
dispense and process technologies;
    
    provide a high level of customer service and applications support in all global markets;
    
    meet customer needs for statistical quality and process control and dock-to-stock
programs; and
    
    meet the industrys needs for advanced materials required for future generation devices.
 Solutions
  8




---



##### Table of Contents



IC Fabrication
   ®
 ®
 9




---



##### Table of Contents



Surface Preparation.
 Copper Plating. ®
 Test Wafer Reclaim Solutions.
 Chemical Mechanical Planarization.
 10




---



##### Table of Contents



Deposition. ®
 ® ®
  Materials Packaging. ® ®
   11




---



##### Table of Contents



Flat-Panel Display Market
  ®
 Life Sciences
   Customers, Sales, and Marketing
  12




---



##### Table of Contents



Manufacturing
  Location
    
    Products
    
    Square FootageAnseong, South Korea
    
       liquid materials
    
    
    9,000Burnet, TX
    
       liquid materials and delivery systems
    
    
    75,000Bloomington, MN
    
       high-purity materials packaging systems
    
    
    68,000Danbury, CT
    
       gas delivery systems
    
    
    75,000   liquid materialsHoegaarden, Belgium
    
       high-purity materials packaging and mixing systems
    
    
    71,000
  Competition
   Research and Development
  13




---



##### Table of Contents



Strategic Alliances
 
 Backlog
  Patents and Proprietary Rights
   14




---



##### Table of Contents



Environmental Regulation
  Employees and Employee Relations
  15




---



##### Table of Contents



Company Information
  www.atmi.com Investor Financial information
  
 
 Item 1A. Risk Factors
 Cautionary Statements Regarding Future Results of Operations
  Cyclicality in the markets we sell to may adversely affect our performance.
  16




---



##### Table of Contents



Our margins may be adversely affected by a number of factors.
  Our business could be adversely affected if we cannot protect our proprietary technology or if
we infringe on the proprietary technology of others.
   We may have difficulty obtaining the resources or products we need for manufacturing or
assembling our products or operating other aspects of our business, which could adversely affect
our ability to meet demand for our products and may increase our costs.
  We face intense competition from a variety of sources, including larger companies.
  
    
    price;
    
    technical capabilities;
    
    quality; or
 17




---



##### Table of Contents




    
    customer service.
 Our global manufacturing and sales activities subject us to risks associated with legal,
political, economic or other changes.
  Our results of operations could be adversely affected by natural events in the locations in
which we, our customers or our suppliers operate.
  The loss of or significant curtailment of purchases by any of our largest customers could
adversely affect our results of operations.
  Incorrect forecasts of customer demand could adversely affect our results of operations.
  Our results of operations could be adversely affected by changes in taxation.
  18




---



##### Table of Contents



We may have difficulty managing our growth and attracting and retaining highly skilled
scientific, technical, managerial and marketing personnel, which could adversely affect our
revenues and increase our operating expenses.
  We engage in acquisitions, and may encounter difficulties integrating acquired businesses with
our current operations; therefore, we may not realize the anticipated benefits of the
acquisitions.
  Our revenues and earnings could be negatively affected if we cannot anticipate market trends,
enhance our existing products and processes, develop and commercialize new products and processes,
and identify and consummate strategic acquisitions.
  We face the risk of product liability claims.
  Our business is potentially subject to substantial liabilities for failure to comply with
environmental regulations.
 19




---



##### Table of Contents



Compliance with changing corporate governance regulations and public disclosures may result in
additional risks and exposures.
  
 Item 1B. Unresolved Staff Comments
  
 Item 2. Properties
  Location
    
    Square Footage
    
    Lease / OwnAnseong, South Korea
    
    
    9,000
    
    
    OwnBloomington, MN
    
    
    68,000
    
    
    LeaseBurnet, TX
    
    
    75,000
    
    
    OwnChutung Town, Taiwan
    
    
    11,000
    
    
    LeaseDanbury, CT (1)
    
    
    31,000
    
    
    LeaseDanbury, CT
    
    
    75,000
    
    
    LeaseHoegaarden, Belgium
    
    
    71,000
    
    
    OwnHsin-chu, Taiwan
    
    
    40,000
    
    
    LeaseShanghai, China
    
    
    6,000
    
    
    LeaseSuwon-si, South Korea
    
    
    8,000
    
    
    LeaseTempe, AZ
    
    
    11,000
    
    
    LeaseTokyo, Japan
    
    
    6,000
    
    
    LeaseToyohashi, Japan
    
    
    13,000
    
    
    Lease
 20




---



##### Table of Contents



(a)
    
    ATMIs corporate headquarters.  
 Item 3. Legal Proceedings
       
 Item 4. Submission of Matters to a Vote of Security Holders
 21




---



##### Table of Contents



22




---



##### Table of Contents



PART II.
 
 Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities
   High
    
    LowFiscal year ended December 31, 20061st Quarter
    
    $
    34.42
    
    
    $
    27.662ndQuarter
    
    
    33.05
    
    
    
    22.863rd Quarter
    
    
    30.60
    
    
    
    21.724th Quarter
    
    
    35.30
    
    
    
    28.31Fiscal year ended December 31, 20071st Quarter
    
    $
    35.00
    
    
    $
    29.422ndQuarter
    
    
    32.49
    
    
    
    29.173rd Quarter
    
    
    36.05
    
    
    
    27.514th Quarter
    
    
    34.57
    
    
    
    28.90
    23




---



##### Table of Contents



Total Number of
    
    Maximum DollarShares Purchased
    
    Value of Shares thatTotal Number
    
    Average
    
    as Part of
    
    May Yet Beof Shares
    
    Price Paid
    
    Publicly Announced
    
    Purchased UnderPeriod (1)
    
    Repurchased (2)
    
    per Share
    
    Programs (3)
    
    the ProgramsOctober 1-31, 2007
    
    
    230,000
    
    
    $
    32.07
    
    
    
    230,000
    
    
    $
    71,552,000November 1-30, 2007
    
    
    258,241
    
    
    $
    30.44
    
    
    
    258,241
    
    
    $
    63,693,000December 1-31, 2007
    
    
    214,044
    
    
    $
    31.51
    
    
    
    214,044
    
    
    $
    56,949,000Total
    
    
    702,285
    
    
    $
    31.30
    
    
    
    702,285
    
    
    $
    56,949,000
 
 (1)
    
    There were no other repurchases of our equity securities by or on behalf of us or any
affiliated purchaser during the fiscal quarter ended December 31, 2007.(2)
    
    Share repurchases are shown on a trade-date basis. At December 31, 2007, $1.0 million
related to these share repurchases had not yet been paid by the Company because the settlement
dates were in January 2008.(3)
    
    In October 2005, the Companys Board of Directors approved a share repurchase program for up
to $75.0 million of ATMI common stock over the subsequent 12 months. In August 2006, the
Companys Board of Directors approved a second share repurchase program for an additional
$150.0 million. Share repurchases are made from time to time in open market transactions at
prevailing market prices or in privately negotiated transactions. Management determines the
timing and amount of purchases under the programs based upon market conditions or other
factors. The programs do not require the Company to purchase any specific number or amount of
shares and may be suspended or reinstated at any time at the Companys discretion and without
notice. 24




---



##### Table of Contents



Item 6. Selected Financial Data
  2007
    
    
    
    
    
    

2006
    
    
    
    
    
    

2005
    
    
    
    
    
    

2004
    
    
    
    
    
    

2003Consolidated Statements of Operations:Revenues
    
    $
    364,088
    
    
    
    
    
    
    $
    325,913
    
    
    
    
    
    
    $
    281,754
    
    
    
    
    
    
    $
    246,291
    
    
    
    
    
    
    $
    171,634Cost of revenues
    
    
    182,480
    (1)
    
    
    
    
    
    
    162,530
    (4)
    
    
    
    
    
    
    140,251
    
    
    
    
    
    
    
    122,415
    
    
    
    
    
    
    
    89,902
    (8)Gross profit
    
    
    181,608
    
    
    
    
    
    
    
    163,383
    
    
    
    
    
    
    
    141,503
    
    
    
    
    
    
    
    123,876
    
    
    
    
    
    
    
    81,732Operating expenses:Research and development
    
    
    29,879
    
    
    
    
    
    
    
    26,217
    
    
    
    
    
    
    
    22,284
    
    
    
    
    
    
    
    19,577
    
    
    
    
    
    
    
    19,170
    (9)Selling, general, and
administrative
    
    
    99,227
    (2)
    
    
    
    
    
    
    90,149
    
    
    
    
    
    
    
    78,810
    
    
    
    
    
    
    
    66,920
    
    
    
    
    
    
    
    54,145Restructuring and other charges
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,731
    (10)Total operating
expenses
    
    
    129,106
    
    
    
    
    
    
    
    116,366
    
    
    
    
    
    
    
    101,094
    
    
    
    
    
    
    
    86,497
    
    
    
    
    
    
    
    75,046Operating income
    
    
    52,502
    
    
    
    
    
    
    
    47,017
    
    
    
    
    
    
    
    40,409
    
    
    
    
    
    
    
    37,379
    
    
    
    
    
    
    
    6,686Interest income (expense), net
    
    
    7,643
    
    
    
    
    
    
    
    8,324
    
    
    
    
    
    
    
    5,407
    
    
    
    
    
    
    
    (3,442
    )
    
    
    
    
    
    
    (3,862
    )Other income (expense), net
    
    
    (742
    )
    
    
    
    
    
    
    515
    
    
    
    
    
    
    
    (432
    )
    
    
    
    
    
    
    (3,473
    )(7)
    
    
    
    
    
    
    (5,453
    )(11)Income (loss) before income
taxes
    
    
    59,403
    
    
    
    
    
    
    
    55,856
    
    
    
    
    
    
    
    45,384
    
    
    
    
    
    
    
    30,464
    
    
    
    
    
    
    
    (2,629
    )Provision (benefit) for income
taxes
    
    
    18,864
    
    
    
    
    
    
    
    15,895
    (5)
    
    
    
    
    
    
    14,662
    
    
    
    
    
    
    
    10,358
    
    
    
    
    
    
    
    (4,617
    )(12)Income from continuing
operations
    
    
    40,539
    
    
    
    
    
    
    
    39,961
    
    
    
    
    
    
    
    30,722
    
    
    
    
    
    
    
    20,106
    
    
    
    
    
    
    
    1,988Income (loss) from operations of
discontinued operations, net
of taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,313
    
    
    
    
    
    
    
    (11,907
    )(13)Gain on disposal of discontinued
operations, net of taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,083
    
    
    
    
    
    
    
    Net income (loss)
    
    $
    40,539
    
    
    
    
    
    
    $
    39,961
    
    
    
    
    
    
    $
    30,722
    
    
    
    
    
    
    $
    31,502
    
    
    
    
    
    
    $
    (9,919
    )Diluted earnings (loss) per
share:Earnings per share from
continuing operations
    
    $
    1.16
    
    
    
    
    
    
    $
    1.08
    
    
    
    
    
    
    $
    0.85
    
    
    
    
    
    
    $
    0.64
    
    
    
    
    
    
    $
    0.06Earnings (loss) per share from
operations of discontinued
operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    0.10
    
    
    
    
    
    
    $
    (0.38
    )Earnings per share from gain on
disposal of discontinued
operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    0.26
    
    
    
    
    
    
    
    Earnings (loss) per common share
    
    $
    1.16
    
    
    
    
    
    
    $
    1.08
    
    
    
    
    
    
    $
    0.85
    
    
    
    
    
    
    $
    1.00
    
    
    
    
    
    
    $
    (0.32
    )
 25




---



##### Table of Contents



2007
    
    
    
    
    
    

2006
    
    
    
    
    
    

2005
    
    
    
    
    
    

2004
    
    
    
    
    
    

2003Weighted-average shares
outstanding  diluted
    
    
    35,093
    
    
    
    
    
    
    
    36,859
    
    
    
    
    
    
    
    36,276
    
    
    
    
    
    
    
    31,650
    
    
    
    
    
    
    
    31,208Consolidated Balance Sheet Data:Cash, cash equivalents, and
marketable securities (14)
    
    $
    193,697
    
    
    
    
    
    
    $
    219,066
    
    
    
    
    
    
    $
    256,137
    
    
    
    
    
    
    $
    238,960
    
    
    
    
    
    
    $
    128,700Working capital
    
    
    280,221
    
    
    
    
    
    
    
    281,362
    
    
    
    
    
    
    
    274,323
    
    
    
    
    
    
    
    190,874
    
    
    
    
    
    
    
    235,204Total assets
    
    
    492,241
    
    
    
    
    
    
    
    488,037
    
    
    
    
    
    
    
    499,836
    
    
    
    
    
    
    
    470,100
    
    
    
    
    
    
    
    414,442Long-term obligations
    
    
    10,656
    (3)
    
    
    
    
    
    
    1,669
    
    
    
    
    
    
    
    3,460
    (6)
    
    
    
    
    
    
    118,255
    
    
    
    
    
    
    
    115,406Total stockholders equity
    
    
    434,383
    
    
    
    
    
    
    
    435,496
    
    
    
    
    
    
    
    452,720
    (6)
    
    
    
    
    
    
    298,098
    
    
    
    
    
    
    
    254,773
 
  (1)
    
    Includes $1.1 million of increased customs expense on imported goods from the U.S. to an
overseas affiliate.(2)
    
    Includes $1.1 million associated with a contingent legal fee arrangement.(3)
    
    Includes $8.9 million of unrecognized tax benefits, which if recognized, would favorably
affect the effective income tax rate in future periods.(4)
    
    Includes $1.4 million one-time recovery of value-added taxes in Japan related to 2005.(5)
    
    Includes a benefit of $1.7 million related to adjustment of our tax liabilities.(6)
    
    Includes effect of conversion of the Companys 5.25 percent convertible subordinated notes
due November 15, 2006 into 5,183,095 shares of common stock.(7)
    
    Includes a $4.5 million asset impairment charge related to the Companys strategic investment
portfolio.(8)
    
    Includes charges of $2.7 million to write down inventory balances in the liquid chemistries
and delivery equipment product lines.(9)
    
    Includes $0.7 million of in-process research and development expensed in connection with the
ESC, Inc. acquisition.(10)
    
    Represents a $2.4 million asset impairment charge related to the Companys former liquid
chemistries manufacturing facility, partially offset by a $0.7 million gain related to
sublease income from a former tenant in the Companys Danbury, Connecticut facility.(11)
    
    Includes $5.7 million of asset impairment charges related to the Companys strategic
investment portfolio.(12)
    
    Includes $3.0 million of tax benefit recognized as a result of a favorable U.S. Tax Court
judgment.(13)
    
    Includes a $2.6 million (net of $1.5 million tax benefit) charge for excess and obsolete
inventory.(14)
    
    Includes non-current marketable securities of $0, $14.4 million, $46.3 million, $105.8
million, and $9.7 million at December 31, 2007, 2006, 2005, 2004, and 2003, respectively. 26




---



##### Table of Contents



Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
  Company Overview
  Critical Accounting Policies and Estimates
    Revenue
Recognition
  27




---



##### Table of Contents



28




---



##### Table of Contents



29




---



##### Table of Contents



30




---



##### Table of Contents



31




---



##### Table of Contents



Results of Operations
  December 31,2007
    
    
    2006
    
    
    2005Cost of revenues
    
    $
    375
    
    
    $
    910
    
    
    
    Research and development
    
    
    432
    
    
    
    773
    
    
    
    Selling, general, and administrative
    
    
    6,791
    
    
    
    7,681
    
    
    $
    2,226Total equity-based compensation expense
    
    
    7,598
    
    
    
    9,364
    
    
    
    2,226Benefit from income taxes
    
    
    2,556
    
    
    
    3,137
    
    
    
    720Net equity-based compensation expense
    
    $
    5,042
    
    
    $
    6,227
    
    
    $
    1,506
 Year ended December 31, 2007 Compared to Year Ended December 31, 2006
 Overview
   December 31,2007
    
    
    2006
    
    
    % ChangeRevenues
    
    $
    364,088
    
    
    $
    325,913
    
    
    
    11.7
    %Cost of revenues
    
    
    182,480
    
    
    
    162,530
    
    
    
    12.3
    %Gross profit
    
    
    181,608
    
    
    
    163,383
    
    
    
    11.2
    %Gross margin percent
    
    
    49.9
    %
    
    
    50.1
    %
    
    
    (0.2
    %)Research and development
    
    
    29,879
    
    
    
    26,217
    
    
    
    14.0
    %R&D as a percent of revenues
    
    
    8.2
    %
    
    
    8.0
    %
    
    
    0.2
    %Selling, general, and administrative
    
    
    99,227
    
    
    
    90,149
    
    
    
    10.1
    %SG&A as a percent of revenues
    
    
    27.3
    %
    
    
    27.7
    %
    
    
    (0.4
    %)Operating income
    
    
    52,502
    
    
    
    47,017
    
    
    
    11.7
    %Operating margin
    
    
    14.4
    %
    
    
    14.4
    %
    
    
    Effective tax rate
    
    
    31.8
    %
    
    
    28.5
    %
    
    
    3.3
    %Net income
    
    $
    40,539
    
    
    $
    39,961
    
    
    
    1.4
    %Diluted earnings per share
    
    $
    1.16
    
    
    $
    1.08
    
    
    
    7.4
    %
 Revenues
 32




---



##### Table of Contents



Gross Profit
 Research and Development Expenses
 Selling, General, and Administrative Expenses Operating
Income.
 Interest Income
 Provision for Income Taxes
 33




---



##### Table of Contents



Year ended December 31, 2006 Compared to Year Ended December 31, 2005
 Overview
   December 31,2006
    
    
    2005
    
    
    % ChangeRevenues
    
    $
    325,913
    
    
    $
    281,754
    
    
    
    15.7
    %Cost of revenues
    
    
    162,530
    
    
    
    140,251
    
    
    
    15.9
    %Gross profit
    
    
    163,383
    
    
    
    141,503
    
    
    
    15.5
    %Gross margin percent
    
    
    50.1
    %
    
    
    50.2
    %
    
    
    (0.1
    %)Research and development
    
    
    26,217
    
    
    
    22,284
    
    
    
    17.6
    %R&D as a percent of revenues
    
    
    8.0
    %
    
    
    7.9
    %
    
    
    0.1
    %Sales, general and administrative
    
    
    90,149
    
    
    
    78,810
    
    
    
    14.4
    %SG&A as a percent of revenues
    
    
    27.7
    %
    
    
    28.0
    %
    
    
    (0.3
    %)Operating income
    
    
    47,017
    
    
    
    40,409
    
    
    
    16.4
    %Operating margin
    
    
    14.4
    %
    
    
    14.3
    %
    
    
    0.1
    %Effective tax rate
    
    
    28.5
    %
    
    
    32.3
    %
    
    
    (3.8
    %)Net income
    
    $
    39,961
    
    
    $
    30,722
    
    
    
    30.1
    %Diluted earnings per share
    
    $
    1.08
    
    
    $
    0.85
    
    
    
    27.1
    %
 Revenues
 Gross Profit
 Research and Development Expenses
 34




---



##### Table of Contents



Selling, General and Administrative Expenses
 Operating Income.
 Interest Income
 Interest Expense
 Provision for Income Taxes
 Liquidity and Capital Resources
   35




---



##### Table of Contents



Years Ended December 31,2007
    
    2006Cash provided by (used for):Operating Activities
    
    $
    64,944
    
    
    $
    62,032Investing Activities
    
    
    20,474
    
    
    
    52,411Financing Activities
    
    
    (53,294
    )
    
    
    (71,760
    )Effects of exchange rate changes on cash
    
    
    (913
    )
    
    
    (38
    )
  
    
    Decrease in cash used by changes in inventories of $6,989 as a result of the
Companys focus on better supply chain utilization
    
    Decrease in cash used by changes in accounts receivable of $3,594, because of
increased focus on reduction of days sales outstanding in Asia and also because
of timing of collections
    
    Increase in cash provided by income taxes payable of $6,313
    
    Cash use of $10,000 to prepay royalties (change shown in the consolidated
statements of cash flows under the caption, Other assets) associated with our
strategic alliance with Intermolecular for high-productivity research and
development activities
    
    Decrease in cash provided by other operating or working capital accounts of
$3,120 due primarily to the decrease in cash generated from accounts payable.
  
    
    Decrease in cash proceeds from sales and maturities of marketable securities in
excess of cash used to purchase marketable securities of $23,190
    
    Increase in capital spending of $7,711 primarily because of the purchase of
research tools used in our research and development activities
    
    Increase in cash paid for cost-basis and equity-basis investments of $723
  
    
    Decrease in share repurchases of $19,791
    
    Decrease of $1,668 in proceeds from stock option exercises in 2007
 36




---



##### Table of Contents



Payments Due by PeriodLess than 1Contractual obligations:
    
    Total
    
    Year
    
    1-3 Years
    
    4-5 Years
    
    ThereafterCapital leases
    
    $
    235
    
    
    $
    76
    
    
    $
    123
    
    
    $
    36
    
    
    $
    Operating leases
    
    
    8,113
    
    
    
    3,548
    
    
    
    3,754
    
    
    
    754
    
    
    
    57Purchase obligations:Inventory purchases
    
    
    8,482
    
    
    
    8,482
    
    
    
    
    
    
    
    
    
    
    
    Capital expenditures (1)
    
    
    18,658
    
    
    
    18,658
    
    
    
    
    
    
    
    
    
    
    
    Other (2)
    
    
    13,090
    
    
    
    6,157
    
    
    
    6,933
    
    
    
    
    
    
    
    Total purchase obligations
    
    
    40,230
    
    
    
    33,297
    
    
    
    6,933
    
    
    
    
    
    
    
    Standby Letters of Credit
    
    
    4,099
    
    
    
    3,949
    
    
    
    150
    
    
    
    
    
    
    
    Other long-term liabilities
    
    
    1,391
    
    
    
    146
    
    
    
    395
    
    
    
    533
    
    
    
    317Total debt, lease,
purchase, and other
long-term liability
obligations
    
    $
    54,068
    
    
    $
    41,016
    
    
    $
    11,355
    
    
    $
    1,323
    
    
    $
    374
 
 (1)
    
    Includes $18.4 million commitment to purchase tool sets for research and development.(2)
    
    Includes $10.9 million commitment to purchase services associated with an alliance
agreement with Intermolecular.
      37




---



##### Table of Contents



Cautionary Statements Under the Private Securities Litigation Reform Act of 1995
   
 Item 7A. Quantitative and Qualitative Disclosures about Market Risk
      38




---



##### Table of Contents



Item 8. Financial Statements and Supplementary Data
  
 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
  
 Item 9A. Controls and Procedures
     39




---



##### Table of Contents



Internal ControlIntegrated
Framework.
  
 Item 9B. Other Information
  40




---



##### Table of Contents



PART III.
  
 PART IV
 
 Item 15.
    
    Exhibits and Financial Statement Schedule
 (a)
    
    The following documents are filed as part of this annual report on Form 10-K:
 (1)
    
    Financial Statements:
       (2)
    
    Financial Statement Schedule:
    41




---



##### Table of Contents



(3)
    
    Exhibits
  Exhibit No.
    
    Description2.01
    
    Asset Purchase Agreement dated as of June 28, 2004 by and between International
Rectifier Corporation, IR Epi Service, Inc. and Advanced Technology Materials, Inc.
(Exhibit 2.1 to ATMIs Current Report on Form 8-K, filed on July 20, 2004). (1) (4)3.01
    
    Restated Certificate of Incorporation dated as of July 30, 2005 (Exhibit 3 (i) to
ATMIs Current Report on Form 8-K, filed on August 3, 2005)). (1)3.03
    
    Amended and Restated Bylaws of ATMI dated July 27, 2007 (Exhibit 3.1 to ATMIs
Current Report on Form 8-K, filed on August 1, 2007, as amended by Form 8-K/A filed
on November 30, 2007). (1)4.01
    
    Specimen of ATMIs Common Stock Certificate (Exhibit 4.01 to the 1997 Form S-4
Registration Statement). (1)4.02
    
    Rights Agreement, dated as of October 13, 2000, between ATMI, Inc. and Fleet
National Bank, as Rights Agent (Exhibit 4.01 to ATMIs Current Report on Form 8-K,
filed on October 17, 2000). (1)4.03
    
    Registration Rights Agreement, dated November 13, 2001, among ATMI, Inc., Goldman,
Sachs & Co. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, relating to
ATMIs 5.25% Convertible Subordinated Notes due 2006 (Exhibit 4.1 to ATMIs
Registration Statement on Form S-3, filed on January 7, 2002, Registration No.
333-76378 (the 2002 Form S-3 Registration Statement)). (1)4.04
    
    Indenture, dated November 13, 2001, between ATMI, Inc. and State Street Bank and
Trust Company, relating to the ATMIs 5.25% Convertible Subordinated Notes due 2006
(Exhibit 4.2 to the 2002 Form S-3 Registration Statement). (1)4.05
    
    Specimen Note for ATMIs 5.25% Convertible Subordinated Notes due 2006 (included in
pages 26 to 40 of the Indenture filed as Exhibit 4.2 to the 2002 Form S-3
Registration Statement). (1)10.01*
    
    Employment Agreement between Eugene G. Banucci, Ph.D. and ATMI, Inc. dated
September 19, 2005, effective as of January 1, 2005 (Exhibit 10.1 to ATMIs Current
Report on Form 8-K, filed on September 19, 2005). (1)10.02*
    
    Employment Agreement between Daniel P. Sharkey and ATMI, Inc. dated December 31,
2004 (Exhibit 10.1 to ATMIs Current Report on Form 8-K, filed on January 5, 2005).
(1)10.03*
    
    Employment Agreement between Douglas A. Neugold and ATMI, Inc. dated December 31,
2004 (Exhibit 10.1 to ATMIs Current Report on Form 8-K/A, filed on January 5,
2005). (1)10.04
    
    Agreement of Lease between Melvyn J. Powers and Mary P. Powers d/b/a/ M&M Realty
and Advanced Technology Materials, Inc., dated December 23, 1994 (Exhibit 10.09 to
Advanced Technology Materials, Inc. Annual Report on Form 10-K/A for the year ended
December 31, 1994, File No. 0-22756). (1)
 42




---



##### Table of Contents



Exhibit No.
    
    Description10.05
    
    First Amendment to Agreement of Lease dated as of November 22, 2000 by and between
Commerce Park Realty, LLC and Advanced Technology Materials, Inc. (Exhibit 10.05 to
ATMIs Annual Report on Form 10-K, filed on March 10, 2006) (the 2005 Form 10-K)
(1)10.06
    
    Second Amendment to Agreement of Lease dated as of March 24, 2003 by and between
Commerce Park Realty, LLC and Advanced Technology Materials, Inc. (Exhibit 10.06 to
the 2005 Form 10-K) (1)10.07*
    
    ATMIs 1995 Stock Plan (Exhibit to ATMIs Registration Statement on Form S-8, File
No. 33-93048). (1)10.08*
    
    ATMIs 1997 Stock Plan, dated October 10, 1997, (Exhibit 99.1 to ATMIs
Registration Statement on Form S-8, filed on April 6, 1998, File No. 333-49561).
(1)10.09*
    
    ATMIs 1998 Stock Plan, dated May 20, 1998 (Exhibit 99.1 to ATMIs Registration
Statement on Form S-8, filed on June 9, 1998, File No. 333-56349). (1)10.10
    
    Agreement of Lease between Seymour R. Powers, Leon Griss and Ruth Griss and
Advanced Technology Materials, Inc., dated November 24, 2000 (Exhibit 10.08 to
ATMIs Annual Report on Form 10-K for the year ended December 31, 2000, File No.
001-16239). (1)10.11*
    
    ATMIs 2000 Stock Plan, dated May 24, 2000 (Exhibit 99.01 to ATMIs Registration
Statement on Form S-8, dated September 20, 2000, File No. 333-46222). (1)10.13*
    
    ATMIs 2003 Stock Plan (as amended May 21, 2003) (Exhibit 4.6 to ATMIs
Registration Statement on Form S-8, filed on August 1, 2003, File No. 333-107591).
(1)10.14*
    
    ATMIs 1998 Employee Stock Purchase Plan, (as amended February 28, 2003)(Exhibit
4.7 to ATMIs Registration Statement on Form S-8, filed on August 1, 2003, File No.
333-107591). (1)10.15
    
    Alliance Agreement dated as of May 16, 2003 by and between Advanced Technology
Materials, Inc. on its own behalf and on behalf of its Affiliates and Enthone, Inc.
(Exhibit 10.15 to ATMIs Annual Report on Form 10-K, filed on March 12, 2004) (the
2003 Form 10-K). (1)(4)10.16
    
    Stock Purchase Agreement dated as of July 14, 2003 by and among Advanced Technology
Materials, Inc., Lente, LLC and the Persons listed on the signature page thereto.
(Exhibit 10.16 to the 2003 Form 10-K). (1)(4)10.17*
    
    Employment Agreement between Cynthia L. Shereda and ATMI, Inc. dated April 29, 2004
(Exhibit 10.01 to ATMIs Quarterly Report on Form 10-Q for the quarter ended June
30, 2004, filed on August 5, 2004). (1)10.18*
    
    Amendment to Employment Agreement between Cynthia L. Shereda and ATMI, Inc. dated
December 31, 2004 (Exhibit 10.2 to ATMIs Current Report on Form 8-K, filed on
January 5, 2005). (1)10.19*
    
    Non-Employee Directors Deferred Compensation Program of ATMI, Inc. 1998 Stock Plan
(Exhibit 10.19 to the 2005 Form 10-K). (1)10.20*
    
    Form of ATMI, Inc. Executive Management Restricted Stock Grant Agreement (Exhibit
10.20 to ATMIs Annual Report on Form 10-K, filed on February 23, 2007 (the 2006
Form 10-K). (1)
 43




---



##### Table of Contents



Exhibit No.
    
    Description10.21*
    
    Form of ATMI, Inc. Employee Non-Qualified Stock Option Agreement (Exhibit 10.21 to
the 2006 Form 10-K). (1)10.22
    
    Agreement of Lease between West Real Estate and Management, Inc. and Advanced
Technology Materials, Inc., dated October 21, 2004 (Exhibit 10.23 to ATMIs Annual
Report on Form 10-K, filed on March 14, 2005) (the 2004 Form 10-K). (1)10.23*
    
    Form of ATMI, Inc. Employee Restricted Stock Grant Agreement  Non-Executive
Management (Exhibit 10.23 to the 2006 Form 10-K). (1)10.24*
    
    Form of ATMI, Inc. Non-Employee Director Restricted Stock Grant (Exhibit 10.24 to
the 2006 Form 10-K). (1)10.25
    
    First Amendment to Agreement of Lease dated as of March 24, 2003 by and between
Seymour R. Powers, Trustee, and Leon Griss and Advanced Technology Materials, Inc.
(Exhibit 10.25 to the 2005 Form 10-K) (1)10.26*
    
    Amendment to ATMIs 1998 Employee Stock Purchase Plan (amended effective February
28, 2003 and January 1, 2007)(Exhibit 99 to ATMIs Quarterly Report on Form 10-Q
for the quarter ended September 30, 2006, filed on October 25, 2006). (1)10.27
    
    Second Amendment to Agreement of Lease dated as of January 18, 2007 by and between
Seymour R. Powers, Trustee, and Carole Kolsky, Deborah A. Tauber and Stephen L.
Griss (as successors to Leon Griss and Ruth Griss) and Advanced Technology
Materials, Inc. (Exhibit 10.27 to the 2006 Form 10-K) (1)10.28
    
    Third Amendment to Agreement of Lease dated as of January 18, 2007 by and between
Commerce Park Realty, LLC and Advanced Technology Materials, Inc. (Exhibit 10.28 to
the 2006 Form 10-K) (1)10.29*
    
    Form of ATMI, Inc. Non-Employee Directors Non-Qualified Stock Option Agreement
(Exhibit 10.29 to the 2006 Form 10-K). (1)10.30
    
    Agreement and Plan of Merger, dated as of January 4, 2008 by and among Advanced
Technology Materials, Inc., ATMI Acquisition Corp., and LevTech, Inc. (2)10.31*
    
    Employment Agreement between Timothy C. Carlson and ATMI, Inc. dated December 31,
2004. (2)10.32*
    
    Amendment to Employment Agreement between Timothy C. Carlson and ATMI, Inc. dated
August 1, 2005. (2)10.33*
    
    Employment Agreement between Ellen Harmon and ATMI, Inc. dated January 14, 2008. (2)10.34*
    
    Amendment to Employment Agreement between Timothy C. Carlson and ATMI, Inc. dated
January 31, 2008, effective as of September 7, 2007. (2)10.35*
    
    Amendment to Employment Agreement between Daniel P. Sharkey and ATMI, Inc. dated
January 31, 2008, effective as of September 7, 2007. (2)21
    
    Subsidiaries of ATMI (2)
 44




---



##### Table of Contents



Exhibit No.
    
    Description23
    
    Consent of Independent Registered Public Accounting Firm (2)31.1
    
    Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule
15d-14(a) of the Securities Exchange Act, as amended. (2)31.2
    
    Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and Rule
15d-14(a) of the Securities Exchange Act, as amended. (2)32
    
    Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002. (3)
 
 *
    
    Management contract or compensatory plan arrangement.(1)
    
    Incorporated by reference.(2)
    
    Filed herewith.(3)
    
    Furnished herewith.(4)
    
    Portions omitted pursuant to a request for confidential treatment. 45




---



##### Table of Contents



SIGNATURES
 Pursuant to the requirements of Section 13 or 15(d) 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.
 ATMI, Inc.February 22, 2008By:
    /S/ Douglas A. NeugoldDouglas A. NeugoldPresident, Chief Executive Officer, and
Director Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the registrant and in the capacities and on the
dates indicated.
 Signature
    
    Title
    
    Date/S/ Douglas A. Neugold

Douglas A. Neugold
    
    President, Chief Executive Officer and
Director (principal executive officer)
    
    February 22, 2008/S/ Timothy C. Carlson

Timothy C. Carlson
    
    Executive Vice President, Chief Financial Officer
and Treasurer (principal financial and
accounting officer)
    
    February 22, 2008/S/ Eugene G. Banucci

Eugene G. Banucci, Ph.D.
    
    Chairman
of the Board and Director
    
    February 22, 2008/S/ Mark A. Adley

Mark A. Adley
    
    Director
    
    February 22, 2008/S/ Robert S. Hillas

Robert S. Hillas
    
    Director
    
    February 22, 2008/S/ Stephen H. Mahle

Stephen H. Mahle
    
    Director
    
    February 22, 2008/S/ C. Douglas Marsh

C. Douglas Marsh
    
    Director
    
    February 22, 2008/S/ Frederick C. Flynn, Jr.

Frederick C. Flynn, Jr.
    
    Director
    
    February 22, 2008/S/ Cheryl L. Shavers

Cheryl L. Shavers, PhD.
    
    Director
    
    February 22, 2008
 46




---



##### Table of Contents



ATMI, INC.
 
 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND FINANCIAL STATEMENT
SCHEDULE
 PageReports of Independent Registered Public Accounting Firm
    
    
    F-2Audited Financial StatementsConsolidated Balance Sheets  December 31, 2007 and 2006
    
    
    F-4Consolidated Statements of Income for the years ended December 31, 2007,
2006, and 2005
    
    
    F-5Consolidated Statements of Stockholders Equity for the years ended
December 31, 2005, 2006, and 2007
    
    
    F-6Consolidated Statements of Cash Flows for the years ended December 31,
2007,
2006, and 2005
    
    
    F-7Notes to Consolidated Financial Statements
    
    
    F-8Financial Statement ScheduleSchedule II  Valuation and Qualifying Accounts
    
    
    F-34
 F-1




---



##### Table of Contents



F-2




---



##### Table of Contents



.
   
 F-3




---



##### Table of Contents



ATMI, INC.
 
 CONSOLIDATED BALANCE SHEETS
  December 31,2007
    
    
    2006ASSETSCurrent assets:Cash and cash equivalents
    
    $
    104,807
    
    
    $
    73,596Marketable securities, current portion
    
    
    88,890
    
    
    
    131,091Accounts receivable, net of allowances of $670 and $666, respectively
    
    
    61,405
    
    
    
    55,867Inventories, net
    
    
    48,885
    
    
    
    47,339Income taxes receivable
    
    
    1,104
    
    
    
    3,500Deferred income taxes
    
    
    9,577
    
    
    
    8,768Prepaid expenses and other current assets
    
    
    12,755
    
    
    
    12,073Total current assets
    
    
    327,423
    
    
    
    332,234Property, plant, and equipment, net
    
    
    106,171
    
    
    
    92,719Goodwill
    
    
    13,730
    
    
    
    13,734Other intangibles, net
    
    
    17,407
    
    
    
    20,669Marketable securities, less current portion
    
    
    
    
    
    
    14,379Other long-term assets
    
    
    27,510
    
    
    
    14,302Total assets
    
    $
    492,241
    
    
    $
    488,037LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable
    
    $
    22,735
    
    
    $
    20,144Accrued liabilities
    
    
    8,380
    
    
    
    15,767Accrued salaries and related benefits
    
    
    10,961
    
    
    
    11,813Income taxes payable
    
    
    2,647
    
    
    
    1,186Other current liabilities
    
    
    2,479
    
    
    
    1,962Total current liabilities
    
    
    47,202
    
    
    
    50,872Deferred income taxes, non-current
    
    
    912
    
    
    
    1,165Other long-term liabilities
    
    
    9,744
    
    
    
    504Commitments and contingencies (Notes 4, 6, 8, 9 and 14)
    
    
    
    
    
    
    Stockholders equity:Preferred stock, par value $.01: 2,000 shares authorized; none issued
    
    
    
    
    
    
    Common stock, par value $.01: 100,000 shares authorized; 38,981 and 38,304
issued and 33,164 and 34,710 outstanding in 2007 and 2006, respectively
    
    
    390
    
    
    
    383Additional paid-in capital
    
    
    412,423
    
    
    
    389,346Treasury stock at cost (5,818 shares in 2007 and 3,594 shares in 2006)
    
    
    (168,844
    )
    
    
    (100,305
    )Retained earnings
    
    
    180,973
    
    
    
    140,434Accumulated other comprehensive income
    
    
    9,441
    
    
    
    5,638Total stockholders equity
    
    
    434,383
    
    
    
    435,496Total liabilities and stockholders equity
    
    $
    492,241
    
    
    $
    488,037
  F-4




---



##### Table of Contents



ATMI, INC.
 
 CONSOLIDATED STATEMENTS OF INCOME
  Year Ended December 31,2007
    
    
    2006
    
    
    2005Revenues
    
    $
    364,088
    
    
    $
    325,913
    
    
    $
    281,754Cost of revenues
    
    
    182,480
    
    
    
    162,530
    
    
    
    140,251Gross profit
    
    
    181,608
    
    
    
    163,383
    
    
    
    141,503Operating expenses:Research and development
    
    
    29,879
    
    
    
    26,217
    
    
    
    22,284Selling, general, and administrative
    
    
    99,227
    
    
    
    90,149
    
    
    
    78,810Total operating expenses
    
    
    129,106
    
    
    
    116,366
    
    
    
    101,094Operating income
    
    
    52,502
    
    
    
    47,017
    
    
    
    40,409Interest income
    
    
    7,689
    
    
    
    8,353
    
    
    
    7,269Interest expense
    
    
    (46
    )
    
    
    (29
    )
    
    
    (1,862
    )Other income (expense), net
    
    
    (742
    )
    
    
    515
    
    
    
    (432
    )Income before income taxes
    
    
    59,403
    
    
    
    55,856
    
    
    
    45,384Provision for income taxes
    
    
    18,864
    
    
    
    15,895
    
    
    
    14,662Net income
    
    $
    40,539
    
    
    $
    39,961
    
    
    $
    30,722Earnings per common share  basic
    
    $
    1.19
    
    
    $
    1.11
    
    
    $
    0.86Weighted-average shares outstanding  basic
    
    
    34,169
    
    
    
    36,083
    
    
    
    35,707Earnings per common share  diluted
    
    $
    1.16
    
    
    $
    1.08
    
    
    $
    0.85Weighted-average shares outstanding  diluted
    
    
    35,093
    
    
    
    36,859
    
    
    
    36,276
  F-5




---



##### Table of Contents



ATMI, INC.
 
 CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
  Deferred
    
    
    
    
    
    
    
    
    
    
    AccumulatedEquity-
    
    
    
    
    
    
    
    
    
    
    OtherAdditional
    
    
    based
    
    
    
    
    
    
    
    
    
    
    Comprehen-Common
    
    
    Paid-in
    
    
    Compen-
    
    
    Treasury
    
    
    Retained
    
    
    sive IncomeStock
    
    
    Capital
    
    
    sation
    
    
    Stock
    
    
    Earnings
    
    
    (Loss)
    
    
    TotalBalance at December 31, 2004
    
    $
    315
    
    
    $
    224,216
    
    
    
    ($1,043
    )
    
    $
    
    
    
    $
    69,751
    
    
    $
    4,859
    
    
    $
    298,098Issuance of 814 shares of common stock
pursuant to the exercise of employee
stock options
    
    
    8
    
    
    
    16,022
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16,030Issuance of 83 shares of common stock
pursuant to the employee stock purchase
plan
    
    
    1
    
    
    
    1,731
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,732Issuance of 20 shares of common stock
pursuant to exercise of warrants
    
    
    
    
    
    
    235
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    235Issuance of 5,183 shares of common stock
pursuant to conversion of notes
    
    
    52
    
    
    
    115,980
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    116,032Purchase of 431 treasury shares
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (12,118
    )
    
    
    
    
    
    
    
    
    
    
    (12,118
    )Issuance of 299 shares of restricted stock
    
    
    3
    
    
    
    6,686
    
    
    
    (6,689
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Equity-based compensation
    
    
    
    
    
    
    
    
    
    
    2,226
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,226Income tax benefits from equity-based
compensation
    
    
    
    
    
    
    2,523
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,523Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,722
    
    
    
    
    
    
    
    30,722Reclassification adjustment related to
marketable securities in unrealized loss
position at prior period end, net of $66
tax benefit
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    113
    
    
    
    113Change in fair value on
available-for-sale securities net of
deferred income tax of $31
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    53
    
    
    
    53Cumulative translation adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,926
    )
    
    
    (2,926
    )Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    27,962Balance at December 31, 2005
    
    
    379
    
    
    
    367,393
    
    
    
    (5,506
    )
    
    
    (12,118
    )
    
    
    100,473
    
    
    
    2,099
    
    
    
    452,720Issuance of 663 shares of common stock
pursuant to the exercise of employee
stock options
    
    
    6
    
    
    
    14,087
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,093Issuance of 85 shares of common stock
pursuant to the employee stock purchase
plan
    
    
    1
    
    
    
    1,770
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,771Purchase of 3,163 treasury shares
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (88,187
    )
    
    
    
    
    
    
    
    
    
    
    (88,187
    )Reclassification of deferred equity-based
compensation
    
    
    
    
    
    
    (5,506
    )
    
    
    5,506
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Equity-based compensation
    
    
    
    
    
    
    9,364
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,364Income tax benefits from equity-based
compensation
    
    
    
    
    
    
    2,235
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,235Other
    
    
    (3
    )
    
    
    3
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    39,961
    
    
    
    
    
    
    
    39,961Reclassification adjustment related to
marketable securities in unrealized loss
position at prior period end, net of $321
tax benefit
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    547
    
    
    
    547Change in fair value on
available-for-sale securities net of
deferred income tax of $105
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    178
    
    
    
    178Cumulative translation adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,814
    
    
    
    2,814Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    43,500Balance at December 31, 2006
    
    
    383
    
    
    
    389,346
    
    
    
    
    
    
    
    (100,305
    )
    
    
    140,434
    
    
    
    5,638
    
    
    
    435,496Issuance of 589 shares of common stock
pursuant to the exercise of employee
stock options
    
    
    6
    
    
    
    13,692
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13,698Issuance of 17 shares of common stock
pursuant to the employee stock purchase
plan
    
    
    1
    
    
    
    498
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    499Purchase of 2,224 treasury shares
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (68,539
    )
    
    
    
    
    
    
    
    
    
    
    (68,539
    )Equity-based compensation
    
    
    
    
    
    
    7,598
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,598Income tax benefits from equity-based
compensation
    
    
    
    
    
    
    1,289
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,289Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    40,539
    
    
    
    
    
    
    
    40,539Reclassification adjustment related to
marketable securities in unrealized loss
position at prior period end, net of $694
tax benefit
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,182
    
    
    
    1,182Change in fair value on
available-for-sale securities net of
deferred income tax of $109
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    186
    
    
    
    186Change in fair value of derivative
financial instruments, net of deferred
income tax of $46
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    78
    
    
    
    78Cumulative translation adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,357
    
    
    
    2,357Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    44,342Balance at December 31, 2007
    
    $
    390
    
    
    $
    412,423
    
    
    
    
    
    
    
    ($168,844
    )
    
    $
    180,973
    
    
    $
    9,441
    
    
    $
    434,383
  F-6




---



##### Table of Contents



ATMI, INC.
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
  Year Ended December 31,2007
    
    
    2006
    
    
    2005Operating activitiesNet income
    
    $
    40,539
    
    
    $
    39,961
    
    
    $
    30,722Adjustments to reconcile net income to cash provided by operating activities:Depreciation and amortization
    
    
    21,795
    
    
    
    20,764
    
    
    
    18,527Provision for inventory obsolescence
    
    
    856
    
    
    
    1,480
    
    
    
    405Deferred income taxes
    
    
    (1,883
    )
    
    
    (2,323
    )
    
    
    4,202Income tax benefits from stock option exercises
    
    
    1,289
    
    
    
    2,235
    
    
    
    2,523Excess tax benefit from share-based arrangements
    
    
    (974
    )
    
    
    (660
    )
    
    
    Stock compensation expense
    
    
    7,598
    
    
    
    9,364
    
    
    
    2,226Impairment of investments
    
    
    
    
    
    
    260
    
    
    
    379Impairments of property, plant, and equipment
    
    
    815
    
    
    
    153
    
    
    
    Undistributed losses from equity method investees
    
    
    989
    
    
    
    361
    
    
    
    310Other
    
    
    98
    
    
    
    (375
    )
    
    
    (956
    )Changes in operating assets and liabilities:Accounts receivable
    
    
    (4,386
    )
    
    
    (7,980
    )
    
    
    (4,294
    )Inventories
    
    
    (760
    )
    
    
    (7,749
    )
    
    
    (2,766
    )Other assets
    
    
    (8,187
    )
    
    
    2,579
    
    
    
    4,153Accounts payable
    
    
    2,163
    
    
    
    8,095
    
    
    
    (5,026
    )Accrued expenses and other liabilities
    
    
    1,124
    
    
    
    (1,688
    )
    
    
    (5,394
    )Income taxes
    
    
    3,868
    
    
    
    (2,445
    )
    
    
    (30
    )Net cash provided by operating activities
    
    
    64,944
    
    
    
    62,032
    
    
    
    44,981Investing activitiesCapital expenditures
    
    
    (35,271
    )
    
    
    (27,560
    )
    
    
    (28,460
    )Proceeds from the sale of property, plant, and equipment
    
    
    347
    
    
    
    362
    
    
    
    428Acquisitions and other cost-basis and equity-basis investments
    
    
    (3,301
    )
    
    
    (2,578
    )
    
    
    (7,695
    )Proceeds from the sale of a cost-basis investment
    
    
    
    
    
    
    298
    
    
    
    3,116Purchases of marketable securities
    
    
    (240,101
    )
    
    
    (179,901
    )
    
    
    (150,440
    )Proceeds from sales or maturities of marketable securities
    
    
    298,800
    
    
    
    261,790
    
    
    
    127,531Net cash provided (used) by investing activities
    
    
    20,474
    
    
    
    52,411
    
    
    
    (55,520
    )Financing activitiesPayments on loans, notes payable, and capital lease obligations
    
    
    (63
    )
    
    
    (92
    )
    
    
    (212
    )Purchases of treasury stock
    
    
    (68,400
    )
    
    
    (88,191
    )
    
    
    (11,276
    )Proceeds from exercise of stock options, warrants, and employee stock purchase plan shares
    
    
    14,195
    
    
    
    15,863
    
    
    
    17,997Excess tax benefit from share-based payment arrangements
    
    
    974
    
    
    
    660
    
    
    
    Net cash (used) provided by financing activities
    
    
    (53,294
    )
    
    
    (71,760
    )
    
    
    6,509Effects of exchange rate changes on cash and cash equivalents
    
    
    (913
    )
    
    
    (38
    )
    
    
    (1,414
    )Net increase (decrease) in cash and cash equivalents
    
    
    31,211
    
    
    
    42,645
    
    
    
    (5,444
    )Cash and cash equivalents, beginning of year
    
    
    73,596
    
    
    
    30,951
    
    
    
    36,395Cash and cash equivalents, end of year
    
    $
    104,807
    
    
    $
    73,596
    
    
    $
    30,951SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:Non-cash conversion of subordinated notes to equity
    
    $
    
    
    
    $
    
    
    
    $
    115,000Non-cash conversion of unamortized debt issuance costs to equity
    
    $
    
    
    
    $
    
    
    
    $
    (1,333
    )Non-cash conversion of unpaid interest accrual to equity relating to subordinated notes
    
    $
    
    
    
    $
    
    
    
    $
    2,365Cash interest paid
    
    $
    46
    
    
    $
    29
    
    
    $
    34Cash income taxes paid
    
    $
    13,993
    
    
    $
    18,830
    
    
    $
    7,852
  F-7




---



##### Table of Contents



ATMI, INC.
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 1. Organization and Summary of Significant Accounting Policies
        Revenue Recognition
  F-8




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 1. Organization and Summary of Significant Accounting Policies (continued)
          F-9




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 1. Organization and Summary of Significant Accounting Policies (continued)
       F-10




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 1. Organization and Summary of Significant Accounting Policies (continued)
          F-11




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 1. Organization and Summary of Significant Accounting Policies (continued)
          F-12




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 1. Organization and Summary of Significant Accounting Policies (continued)
        F-13




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 1. Organization and Summary of Significant Accounting Policies (continued)
      2005Net income, as reported
    
    $
    30,722Add: Total stock-based employee compensation expense included in
reported net income, net of tax effect
    
    
    1,506Deduct: Total stock-based employee compensation expense
determined under fair value based method for all awards, net of
tax effect
    
    
    (7,580
    )Pro forma net income
    
    $
    24,648Income (loss) per share:Basic-as reported
    
    $
    0.86Basic-pro forma
    
    $
    0.69Diluted-as reported
    
    $
    0.85Diluted-pro forma
    
    $
    0.68
 F-14




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 1. Organization and Summary of Significant Accounting Policies (continued)
      F-15




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 1. Organization and Summary of Significant Accounting Policies (continued)
 .
    F-16




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 2. Prepaid Expenses and Other Current Assets
  3. Marketable Securities
  2007
    
    
    2006Gross
    
    
    
    
    
    
    
    
    
    
    GrossUnrealized
    
    
    Estimated
    
    
    
    
    
    
    Unrealized
    
    
    EstimatedCost
    
    
    Gain (Loss)
    
    
    Fair Value
    
    
    Cost
    
    
    Gain (Loss)
    
    
    Fair ValueSecurities in unrealized gain
position:Common stock
    
    $
    971
    
    
    $
    3,871
    
    
    $
    4,842
    
    
    $
    971
    
    
    $
    2,227
    
    
    $
    3,198Government debt
obligations
    
    
    49,666
    
    
    
    199
    
    
    
    49,865
    
    
    
    5,874
    
    
    
    5
    
    
    
    5,879GS (1) debt obligations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,000
    
    
    
    1
    
    
    
    3,001Subtotal
    
    
    50,637
    
    
    
    4,070
    
    
    
    54,707
    
    
    
    9,845
    
    
    
    2,233
    
    
    
    12,078Securities in unrealized loss
position:Corporate debt obligations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    26,460
    
    
    
    (153
    )
    
    
    26,307Government debt
obligations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16,924
    
    
    
    (20
    )
    
    
    16,904GS (1) debt obligations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    27,375
    
    
    
    (157
    )
    
    
    27,218Subtotal
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    70,759
    
    
    
    (330
    )
    
    
    70,429Securities at amortized cost:Corporate debt obligations
    
    
    10,683
    
    
    
    
    
    
    
    10,683
    
    
    
    10,003
    
    
    
    
    
    
    
    10,003Government debt
obligations
    
    
    23,500
    
    
    
    
    
    
    
    23,500
    
    
    
    52,960
    
    
    
    
    
    
    
    52,960Subtotal
    
    
    34,183
    
    
    
    
    
    
    
    34,183
    
    
    
    62,963
    
    
    
    
    
    
    
    62,963Total marketable securities
    
    $
    84,820
    
    
    $
    4,070
    
    
    $
    88,890
    
    
    $
    143,567
    
    
    $
    1,903
    
    
    $
    145,470
 
 (1)
    
    Government Sponsored  EstimatedCost
    
    
    Fair ValueDue in one year or less
    
    $
    66,793
    
    
    $
    66,882Due between one and three years
    
    
    17,056
    
    
    
    17,16683,849
    
    
    
    84,048Common stock
    
    
    971
    
    
    
    4,842$
    84,820
    
    
    $
    88,890
  F-17




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 3. Marketable Securities (continued)
  Less Than 12 Months
    
    12 Months or Greater
    
    TotalUnrealized
    
    
    
    
    
    Unrealized
    
    
    
    
    
    UnrealizedFair Value
    
    Losses
    
    Fair Value
    
    Losses
    
    Fair Value
    
    LossesCorporate debt obligations
    
    $
    2,000
    
    
    
    ($3
    )
    
    $
    24,307
    
    
    
    ($150
    )
    
    $
    26,307
    
    
    
    ($153
    )Government debt obligations
    
    
    16,904
    
    
    
    (20
    )
    
    
    
    
    
    
    
    
    
    
    16,904
    
    
    
    (20
    )GS debt obligations
    
    
    4,986
    
    
    
    (14
    )
    
    
    22,232
    
    
    
    (143
    )
    
    
    27,218
    
    
    
    (157
    )Total
    
    $
    23,890
    
    
    
    ($37
    )
    
    $
    46,539
    
    
    
    ($293
    )
    
    $
    70,429
    
    
    
    ($330
    )
 4. Inventories
  2007
    
    
    2006Raw materials
    
    $
    16,005
    
    
    $
    13,727Work in process
    
    
    1,063
    
    
    
    1,926Finished goods (1)
    
    
    34,134
    
    
    
    34,03951,202
    
    
    
    49,692Excess and obsolescence reserve
    
    
    (2,317
    )
    
    
    (2,353
    )Inventories, net
    
    $
    48,885
    
    
    $
    47,339
 
 (1)
    
    $6.0 million and $6.3 million of this inventory resides at
non-ATMI consignment locations at December 31, 2007 and 2006, respectively.  5. Foreign Currency Exchange Contracts
   F-18




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 6. Property, Plant and Equipment, Net
  December 31,2007
    
    
    2006Land
    
    $
    1,234
    
    
    $
    1,236Buildings
    
    
    24,402
    
    
    
    23,452Machinery and equipment
    
    
    136,614
    
    
    
    114,284Furniture and fixtures
    
    
    3,145
    
    
    
    2,915Leasehold improvements
    
    
    17,240
    
    
    
    15,816Construction in progress
    
    
    14,126
    
    
    
    9,003196,761
    
    
    
    166,706Accumulated depreciation and amortization
    
    
    (90,590
    )
    
    
    (73,987
    )$
    106,171
    
    
    $
    92,719
     F-19




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 7. Goodwill and Other Intangibles
  Patents &
    
    
    
    
    
    
    Total OtherGoodwill
    
    
    
    Trademarks
    
    
    Other
    
    
    IntangiblesBalance at January 1, 2005
    
    $
    13,681
    
    
    
    $
    21,173
    
    
    $
    2,915
    
    
    $
    24,088Amortization
    
    
    
    
    
    
    
    (2,526
    )
    
    
    (903
    )
    
    
    (3,429
    )Other, including foreign currency translation
    
    
    53
    
    
    
    
    40
    
    
    
    (30
    )
    
    
    10Balance at December 31, 2006
    
    $
    13,734
    
    
    
    $
    18,687
    
    
    $
    1,982
    
    
    $
    20,669Amortization
    
    
    
    
    
    
    
    (2,484
    )
    
    
    (759
    )
    
    
    (3,243
    )Other, including foreign currency translation
    
    
    (4
    )
    
    
    
    (37
    )
    
    
    18
    
    
    
    (19
    )Balance at December 31, 2007
    
    $
    13,730
    
    
    
    $
    16,166
    
    
    $
    1,241
    
    
    $
    17,407
  Patents &
    
    
    
    
    
    
    Total OtherGoodwill
    
    
    
    Trademarks
    
    
    Other
    
    
    IntangiblesGross Amount as of December 31, 2006
    
    $
    13,734
    
    
    
    $
    27,570
    
    
    $
    5,969
    
    
    $
    33,539Accumulated Amortization
    
    
    
    
    
    
    
    (8,883
    )
    
    
    (3,987
    )
    
    
    (12,870
    )Balance as of December 31, 2006
    
    $
    13,734
    
    
    
    $
    18,687
    
    
    $
    1,982
    
    
    $
    20,669Gross Amount as of December 31, 2007
    
    $
    13,730
    
    
    
    $
    27,533
    
    
    $
    5,969
    
    
    $
    33,502Accumulated Amortization
    
    
    
    
    
    
    
    (11,367
    )
    
    
    (4,728
    )
    
    
    (16,095
    )Balance as of December 31, 2007
    
    $
    13,730
    
    
    
    $
    16,166
    
    
    $
    1,241
    
    
    $
    17,407
 F-20




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 7. Goodwill and Other Intangibles (continued)
  Year
    
    Amount2008
    
    $
    2,9242009
    
    
    2,9242010
    
    
    2,3172011
    
    
    1,4312012
    
    
    1,431Thereafter
    
    
    6,380Total
    
    $
    17,407
 8. Other Long-term Assets
  9. Leases
   OperatingLeases2008
    
    $
    3,5482009
    
    
    2,7562010
    
    
    9982011
    
    
    5122012
    
    
    242Thereafter
    
    
    57Total minimum lease payments
    
    $
    8,113
 F-21




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 10. Income Taxes
  Year Ended December 31,2007
    
    
    2006
    
    
    2005Domestic
    
    $
    48,174
    
    
    $
    48,763
    
    
    $
    41,127Foreign
    
    
    11,229
    
    
    
    7,093
    
    
    
    4,257Total pre-tax income
    
    $
    59,403
    
    
    $
    55,856
    
    
    $
    45,384
  December 31,2007
    
    
    2006
    
    
    2005Current:Federal
    
    $
    16,489
    
    
    $
    15,080
    
    
    $
    7,529State
    
    
    1,184
    
    
    
    1,410
    
    
    
    948Foreign
    
    
    3,129
    
    
    
    1,727
    
    
    
    1,937Total current
    
    
    20,802
    
    
    
    18,217
    
    
    
    10,414Deferred:Federal
    
    
    (1,533
    )
    
    
    (1,896
    )
    
    
    4,600State
    
    
    (128
    )
    
    
    (382
    )
    
    
    (93
    )Foreign
    
    
    (277
    )
    
    
    (44
    )
    
    
    (259
    )Total deferred
    
    
    (1,938
    )
    
    
    (2,322
    )
    
    
    4,248$
    18,864
    
    
    $
    15,895
    
    
    $
    14,662
  December 31,2007
    
    
    2006Deferred tax assets:Accrued liabilities
    
    $
    5,176
    
    
    $
    4,791Inventory adjustments
    
    
    6,618
    
    
    
    5,975Net operating loss and tax credit carryforwards
    
    
    2,000
    
    
    
    2,040Equity-based compensation
    
    
    5,013
    
    
    
    3,626Other, net
    
    
    20
    
    
    
    3618,827
    
    
    
    16,468Valuation allowance
    
    
    (278
    )
    
    
    (416
    )18,549
    
    
    
    16,052Deferred tax liabilities:Depreciation and amortization
    
    
    (8,328
    )
    
    
    (7,746
    )Unrealized gain on marketable securities
    
    
    (1,507
    )
    
    
    (703
    )Other, net
    
    
    (49
    )
    
    
    (9,884
    )
    
    
    (8,449
    )Net deferred tax assets
    
    $
    8,665
    
    
    $
    7,603
 F-22




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 10. Income Taxes (continued)
    For the Year Ended December 31,2007
    
    
    2006
    
    
    2005U.S. statutory rate
    
    $
    20,791
    
    
    $
    19,550
    
    
    $
    15,884State income taxes
    
    
    686
    
    
    
    668
    
    
    
    555Foreign income taxes
    
    
    (1,062
    )
    
    
    (722
    )
    
    
    65Tax Exempt Income
    
    
    (1,894
    )
    
    
    (949
    )
    
    
    (11
    )ETI benefit
    
    
    
    
    
    
    (1,040
    )
    
    
    (1,637
    )Change in valuation allowance of deferred tax assets
    
    
    (105
    )
    
    
    (20
    )
    
    
    (56
    )Adjustment to tax liabilities
    
    
    677
    
    
    
    (1,716
    )
    
    
    Other, net
    
    
    (229
    )
    
    
    124
    
    
    
    (138
    )$
    18,864
    
    
    $
    15,895
    
    
    $
    14,662
   F-23




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 10. Income Taxes (continued)
   Beginning Balance  January 1, 2007
    
    $
    8,238Increases from prior period positions
    
    
    819Decreases from prior period positions
    
    
    (29
    )Increases from current period positions
    
    
    489Decreases from current period positions
    
    
    Decreases related to settlements with taxing authorities
    
    
    (284
    )Decreases from lapse of statute of limitations
    
    
    (22
    )Ending Balance  December 31, 2007
    
    $
    9,211
  11. Defined Contribution Plan
  F-24




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 12. Stockholders Equity
  2007
    
    
    2006
    
    
    2005Cost of revenues
    
    $
    375
    
    
    $
    910
    
    
    $
    Research and development
    
    
    432
    
    
    
    773
    
    
    
    Selling, general and administrative
    
    
    6,791
    
    
    
    7,681
    
    
    
    2,226Total equity-based compensation expense
    
    
    7,598
    
    
    
    9,364
    
    
    
    2,226Benefit from income taxes
    
    
    2,556
    
    
    
    3,137
    
    
    
    720Net equity-based compensation expense
    
    $
    5,042
    
    
    $
    6,227
    
    
    $
    1,506
     # of# of Shares
    
    SharesStock Plan
    
    Approved
    
    Available1998 Stock Plan (1)
    
    
    2,000
    
    
    
    4692000 Stock Plan (2)
    
    
    2,000
    
    
    
    3082003 Stock Plan (2)
    
    
    3,000
    
    
    
    1,426Employee Stock Purchase Plan (3)
    
    
    1,000
    
    
    
    299Totals
    
    
    8,000
    
    
    
    2,502
 
 (1)
    
    Exercise prices for ISOs granted under this plan may not be less than 100 percent of the fair
market value for the Companys common stock on the date of grant. Exercise prices for
non-qualified stock options granted under this plan may not be less than 50 percent of the
fair market value for the Companys common stock on the date of grant.(2)
    
    Exercise prices for ISOs and non-qualified stock options granted under this plan may not be
less than 100 percent of the fair market value for the Companys common stock on the date of
grant.(3)
    
    Effective January 1, 2007, this plan was amended such that employees may purchase shares at
95 percent of the closing price on the day previous to the last day of each six-month offering
period. Beginning January 1, 2007 this plan is no longer considered to be compensatory, as
defined by SFAS No. 123(R). F-25




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 12. Stockholders Equity (continued)
     2007
    
    2006
    
    2005Stock option grants:Risk free interest rate
    
    
    4.53
    %
    
    
    4.70
    %
    
    
    3.90
    %Expected term, in years
    
    
    6.25
    
    
    
    6.25
    
    
    
    5.10Expected volatility
    
    
    32.7
    %
    
    
    32.4
    %
    
    
    68.3
    %Dividend yield
    
    
    0
    %
    
    
    0
    %
    
    
    0
    %
   F-26




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 12. Stockholders Equity (continued)
   Average
    
    
    Average
    
    
    AggregateNumber of
    
    
    Exercise
    
    
    Remaining
    
    
    IntrinsicOptions
    
    
    Price
    
    
    Life
    
    
    ValueOutstanding at December 31, 2006
    
    
    2,761
    
    
    $
    24.95Granted
    
    
    125
    
    
    $
    30.69Exercised
    
    
    (589
    )
    
    $
    23.26Forfeited
    
    
    (125
    )
    
    $
    25.67Outstanding at December 31, 2007
    
    
    2,172
    
    
    $
    25.71
    
    
    
    4.8
    
    
    $
    16,305Exercisable at December 31, 2007
    
    
    1,617
    
    
    $
    25.92
    
    
    
    3.9
    
    
    $
    12,336
    Number of
    
    AverageShares
    
    Grant Date Fair ValueNonvested at December 31, 2006
    
    
    559
    
    
    $
    25.59Granted
    
    
    460
    
    
    $
    32.46Vested
    
    
    (72
    )
    
    $
    23.50Forfeited
    
    
    (217
    )
    
    $
    28.67Nonvested at December 31, 2007
    
    
    730
    
    
    $
    28.31
  F-27




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 12. Stockholders Equity (continued)
    2007
    
    
    2006
    
    
    2005Numerator:Income from continuing operations
    
    $
    40,539
    
    
    $
    39,961
    
    
    $
    30,722Denominator:Denominator for basic earnings per share-
Weighted-average shares
    
    
    34,169
    
    
    
    36,083
    
    
    
    35,707Dilutive effect of employee stock options
    
    
    550
    
    
    
    559
    
    
    
    462Dilutive effect of restricted stock
    
    
    374
    
    
    
    217
    
    
    
    99Dilutive effect of warrants
    
    
    
    
    
    
    
    
    
    
    8Denominator for diluted earnings per share
    
    
    35,093
    
    
    
    36,859
    
    
    
    36,276Earnings per share  basic
    
    $
    1.19
    
    
    $
    1.11
    
    
    $
    0.86Earnings per share  assuming dilution
    
    $
    1.16
    
    
    $
    1.08
    
    
    $
    0.85
  F-28




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 12. Stockholders Equity (continued)
    F-29




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 13. Accumulated Other Comprehensive Income
  UnrealizedGain (Loss)on
    
    
    Unrealized GainCurrency
    
    
    Available-
    
    
    (Loss) onTranslation
    
    
    for-Sale
    
    
    DerivativeAdjustments
    
    
    Securities
    
    
    Instruments
    
    
    TotalBalance at January 1, 2004
    
    $
    4,545
    
    
    $
    314
    
    
    $
    
    
    
    $
    4,859Reclassification adjustment
related to marketable securities
in unrealized loss position at
prior period end, net of $66 tax
benefit (1)
    
    
    
    
    
    
    113
    
    
    
    
    
    
    
    113Change in fair value of
available-for-sale securities,
net of deferred income tax of
$31
    
    
    
    
    
    
    53
    
    
    
    
    
    
    
    53Cumulative translation adjustment
    
    
    (2,926
    )
    
    
    
    
    
    
    
    
    
    
    (2,926
    )Balance at December 31, 2005
    
    
    1,619
    
    
    
    480
    
    
    
    
    
    
    
    2,099Reclassification adjustment
related to marketable securities
in unrealized loss position at
prior period end, net of $321
tax benefit (1)
    
    
    
    
    
    
    547
    
    
    
    
    
    
    
    547Change in fair value of
available-for-sale securities,
net of deferred income tax of
$105
    
    
    
    
    
    
    178
    
    
    
    
    
    
    
    178Cumulative translation adjustment
    
    
    2,814
    
    
    
    
    
    
    
    
    
    
    
    2,814Balance at December 31, 2006
    
    
    4,433
    
    
    
    1,205
    
    
    
    
    
    
    
    5,638Reclassification adjustment
related to marketable securities
in unrealized loss position at
prior period end, net of $694 tax
benefit (1)
    
    
    
    
    
    
    1,182
    
    
    
    
    
    
    
    1,182Change in fair value of
available-for-sale securities,
net of deferred income tax of
$109
    
    
    
    
    
    
    186
    
    
    
    
    
    
    
    186Change in fair value of
derivative financial instruments,
net of deferred income tax of $46
    
    
    
    
    
    
    
    
    
    
    78
    
    
    
    78Cumulative translation adjustment
    
    
    2,357
    
    
    
    
    
    
    
    
    
    
    
    2,357Balance at December 31, 2007
    
    $
    6,790
    
    
    $
    2,573
    
    
    $
    78
    
    
    $
    9,441
 
 (1)
    
    Determined based on the specific identification method.
 14. Commitments, Contingencies, and Other
    F-30




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 14. Commitments, Contingencies, and Other (continued)
           F-31




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 15. Geographic Data
  Other
    
    Europe and(In thousands)
    
    U.S.
    
    Taiwan
    
    Japan
    
    South Korea
    
    Pacific Rim
    
    Other
    
    TotalDecember 31, 2007Revenues
    
    $
    84,938
    
    
    $
    89,162
    
    
    $
    45,961
    
    
    $
    48,995
    
    
    $
    51,249
    
    
    $
    43,783
    
    
    $
    364,088Long-lived assets
    
    
    144,259
    
    
    
    4,436
    
    
    
    1,404
    
    
    
    2,764
    
    
    
    322
    
    
    
    11,633
    
    
    
    164,818December 31, 2006Revenues
    
    $
    103,921
    
    
    $
    67,451
    
    
    $
    46,924
    
    
    $
    36,427
    
    
    $
    37,794
    
    
    $
    33,396
    
    
    $
    325,913Long-lived assets
    
    
    127,657
    
    
    
    4,436
    
    
    
    1,167
    
    
    
    2,774
    
    
    
    99
    
    
    
    5,291
    
    
    
    141,424December 31, 2005Revenues
    
    $
    92,744
    
    
    $
    64,714
    
    
    $
    43,077
    
    
    $
    27,314
    
    
    $
    24,928
    
    
    $
    28,977
    
    
    $
    281,754Long-lived assets
    
    
    127,616
    
    
    
    376
    
    
    
    882
    
    
    
    2,531
    
    
    
    101
    
    
    
    3,543
    
    
    
    135,049
  F-32




---



##### Table of Contents



ATMI, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Continued)
 16. Quarterly Results of Operations (Unaudited)
  Quarter2007
    
    First
    
    
    Second
    
    
    Third
    
    
    FourthRevenues
    
    $
    82,154
    
    
    $
    92,432
    
    
    $
    91,131
    
    
    $
    98,371Gross profit
    
    
    39,274
    
    
    
    45,185
    
    
    
    45,973
    (b)
    
    
    51,176
    (c)Operating income
    
    
    7,476
    
    
    
    11,649
    (a)
    
    
    15,131
    
    
    
    18,246Net income
    
    $
    6,323
    
    
    $
    9,271
    
    
    $
    11,327
    
    
    $
    13,618Basic income per common share:Net income per common share
    
    $
    0.18
    
    
    $
    0.27
    
    
    $
    0.33
    
    
    $
    0.41Diluted income per common share:Net income per common share
    
    $
    0.18
    
    
    $
    0.26
    
    
    $
    0.32
    
    
    $
    0.402006Revenues
    
    $
    76,936
    
    
    $
    82,484
    
    
    $
    82,124
    
    
    $
    84,369Gross profit
    
    
    36,808
    
    
    
    41,942
    
    
    
    41,908
    
    
    
    42,725
    (e)Operating income
    
    
    8,637
    
    
    
    12,649
    
    
    
    12,460
    
    
    
    13,271Net income
    
    $
    7,430
    
    
    $
    10,050
    
    
    $
    11,354
    (d)
    
    $
    11,127Basic income per common share:Net income per common share
    
    $
    0.20
    
    
    $
    0.27
    
    
    $
    0.32
    
    
    $
    0.32Diluted income per common share:Net income per common share
    
    $
    0.20
    
    
    $
    0.27
    
    
    $
    0.31
    
    
    $
    0.31
 
 (a)
    
    Includes $1.1 million associated with a contingent legal fee arrangement.(b)
    
    Includes $0.7 million of increased customs expense on imported goods from the U.S. to
an overseas affiliate.(c)
    
    Includes $0.4 million of increased customs expense on imported goods from the U.S. to
an overseas affiliate.(d)
    
    Includes recognition of $1.7 million tax benefit for adjustment of our tax liabilities
as a result of changes in facts in circumstances.(e)
    
    Includes a $1.4 million gain from a VAT recovery in Japan. 17. Subsequent Event
  F-33




---



##### Table of Contents



ATMI, Inc.
 
 Schedule II  Valuation and Qualifying Accounts
Three Years Ended December 31, 2007
 Allowances for Doubtful Accounts and Sales Returns:
 Balance December 31, 2004
    
    $
    701Provision charged to income
    
    
    Doubtful accounts written off (net)
    
    
    4Other adjustments
    
    
    (10
    )Balance December 31, 2005
    
    
    695Provision charged to income
    
    
    Doubtful accounts written off (net)
    
    
    (37
    )Other adjustments
    
    
    8Balance December 31, 2006
    
    
    666Provision charged to income
    
    
    Doubtful accounts written off (net)
    
    
    (3
    )Other adjustments
    
    
    7Balance December 31, 2007
    
    $
    670
 Allowance for Excess and Obsolete Inventories:
 Balance December 31, 2004
    
    $
    2,796Provision charged to income
    
    
    405Disposals of inventory written off
    
    
    (1,049
    )Other adjustments
    
    
    (78
    )Balance December 31, 2005
    
    
    2,074Provision charged to income
    
    
    1,480Disposals of inventory written off
    
    
    (1,207
    )Other adjustments
    
    
    6Balance December 31, 2006
    
    
    2,353Provision charged to income
    
    
    856Disposals of inventory written off
    
    
    (912
    )Other adjustments
    
    
    20Balance December 31, 2007
    
    $
    2,317
 Future Income Tax Benefits  Valuation Allowance:
 Balance December 31, 2004
    
    $
    647Additions charged to income tax expense
    
    
    86Reductions credited to income tax expense
    
    
    (142
    )Other adjustments
    
    
    Balance December 31, 2005
    
    
    591Additions charged to income tax expense
    
    
    3Reductions credited to income tax expense
    
    
    (23
    )Other adjustments
    
    
    (155
    )Balance December 31, 2006
    
    
    416Additions charged to income tax expense
    
    
    20Reductions credited to income tax expense
    
    
    (125
    )Other adjustments
    
    
    (33
    )Balance December 31, 2007
    
    $
    278
 F-34