<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM 10-K/A
ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended October 25, 1998
Commission file number 0-14365
--------------------
ALPHA TECHNOLOGIES GROUP, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 76-0079338
(State or other jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
9465 Wilshire Blvd., Suite 980
Beverly Hills, CA 90212
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (310) 385-1494
--------------------
Securities registered under Section 12 (b) of the Exchange Act:
None
Securities registered under Section 12 (g) of the Exchange Act:
Common Stock, $.03 Par Value
----------------------------
(Title of each class)
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) had been subject to such
filing requirements for the past 90 days. Yes X No
----- -----
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]
State the aggregate market value of the voting stock held by non-affiliates of
the registrant.
$9,295,694 at January 29, 1999
Indicate the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date.
Common Stock, 6,932,285 shares outstanding at January 29, 1999
----------------
<PAGE>
The undersigned registrant hereby amends the following items, financial
statements, exhibits or other portions of its Annual Report on Form 10-K for the
fiscal year ended October 25, 1998 as set forth in the pages attached hereto:
Item 14(a)(3) Exhibits.
Exhibit 28.1 Annual Report on Form 11-K for the
fiscal year ended December 31, 1998 for the
ATGI 401(k) Plan
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this amendment to be signed on its behalf by the
undersigned, hereunto duly authorized.
ALPHA TECHNOLOGIES GROUP, INC.
By: /s/ JOHNNY J. BLANCHARD
______________________________
Johnny J. Blanchard
Principal Accounting Officer
Dated: June 28, 1999
<PAGE>
EXHIBIT INDEX
Sequentially
Exhibit Numbered
Number Description of Exhibit Page
------- ---------------------- ------------
28.1 Annual Report on Form 11-K for the year ended
December 31, 1998 for the ATGI 401K PLAN
<PAGE>
Exhibit 28.1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the fiscal year ended December 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ________________________to____________________
Commission file number 0-14365
A. Full title of the plan and the address of the plan, if different from that of
the issuer named below:
ATGI 401(K) PLAN
B. Name of issuer of the securities held pursuant to the plan and the address of
its principal executive office:
ALPHA TECHNOLOGIES GROUP, INC.
306 Pasadena Avenue
South Pasadena, CA 91030
<PAGE>
REQUIRED INFORMATION
Item 1. The audited statements of financial condition (Statements of Net Assets
Available for Benefits) as of December 31, 1998 and 1997 are set forth
on page F-2.
Item 2. The audited statements of income and changes in plan equity (Statements
of Changes in Net Assets Available for Benefits) for the year ended
December 31, 1998 are set forth on page F-3.
Item 3. The statements required by Items 1 and 2 were prepared in accordance
with the applicable provisions of Article 6A of Regulation S-X (17 CFR
210.6A-01-.6A-05).
Item 4. Not applicable.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
ATGI 401(K) PLAN
By: /s/ STEVE E. CHUPIK
-----------------------------
Steve E. Chupik
Trustee of the Plan
Date: June 28, 1999
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Board of Trustees of the
ATGI 401(K) PLAN
We have audited the accompanying statement of net assets available for
benefits of the ATGI 401(k) Plan as of December 31, 1998 and 1997, and the
related statement of changes in net assets available for benefits for the year
ended December 31, 1998. These financial statements are the responsibility of
the Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the net assets available for benefits of the Plan as
of December 31, 1998 and 1997, and the changes in its net assets available for
benefits for the year ended December 31, 1998 in conformity with generally
accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The accompanying supplemental
schedules of assets held for investment purposes at December 31, 1998 and
reportable transactions for the year then ended are presented for purposes of
complying with the Department of Labor's Rules and Regulations for Reporting and
Disclosure under the Employee Retirement Income Security Act of 1974 and are not
a required part of the basic financial statements. The supplemental schedules
have been subjected to the auditing procedures applied in our audits of the
basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
/s/ Melton & Melton, L.L.P.
Houston, Texas
April 30, 1999
<PAGE>
ATGI 401(K) PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1998 AND 1997
1998 1997
---- ----
ASSETS
------
Investments:
Alpha Technologies Group, Inc.,
Common Stock (at market), 248,379 and
200,236 shares at December 31, 1998
and 1997, respectively $ 380,331 $ 775,916
Connecticut General Life Insurance
Company (a CIGNA company) accounts
at contract value:
Guaranteed Short-Term Account 371,761 376,592
Guaranteed Long-Term Account 2,770,898 2,702,471
Connecticut General Life Insurance
Company (a CIGNA company) accounts
at market value:
Stock Market Index Account 1,405,743 1,089,992
Growth Opportunities Account 1,881,658 1,636,295
Janus Fund 642,302 271,825
PBHG Growth Fund 416,604 304,800
American Century Fund 47,458 32,432
Participant loans 299,054 258,762
---------- ----------
Total investments 8,215,809 7,449,085
---------- ----------
Receivables:
Employer contributions 36,755 41,054
Participant contributions 89,581 114,528
---------- ----------
Total receivables 126,336 155,582
---------- ----------
Cash 25 3,789
---------- ----------
Total assets 8,342,170 7,608,456
---------- ----------
LIABILITIES
-----------
Due to participants - 22,830
Administrative fees payable 4,045 2,960
---------- ----------
Total liabilities 4,045 25,790
---------- ----------
Net assets available for
benefits $8,338,125 $7,582,666
========== ==========
(See Notes to Financial Statements)
<PAGE>
ATGI 401(K) PLAN
STATEMENT OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1998
ADDITIONS TO NET ASSETS:
Participant contributions $1,335,528
Employer contributions 325,069
----------
1,660,597
Interest and dividend income 196,359
----------
Total additions 1,856,956
----------
DEDUCTIONS FROM NET ASSETS:
Benefit payments 1,343,778
Commissions and fees paid by
participants 29,315
Administrative expenses 33,914
----------
Total deductions 1,407,007
----------
Net realized and unrealized
appreciation in fair market
value of investments 305,510
----------
Increase in net assets 755,459
NET ASSETS AVAILABLE FOR BENEFITS:
Balance, December 31, 1997 7,582,666
----------
Balance, December 31, 1998 $8,338,125
==========
(See Notes to Financial Statements)
<PAGE>
ATGI 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
NOTE 1 - DESCRIPTION OF THE PLAN
GENERAL
The ATGI 401(k) Plan (the "Plan"), for employees of Alpha Technologies
Group, Inc. and its subsidiaries (the "Company"), is a defined contribution
profit sharing plan, established November 1, 1977.
ELIGIBILITY
All employees are eligible to participate in the Plan without regard to
minimum age or service requirements. The employee must be employed on the
following entry dates in order to participate: January 1, April 1, July 1, or
October 1.
DISTRIBUTIONS
A participant or beneficiary shall be immediately vested upon death,
retirement or termination of employment due to total and permanent disability.
Normal retirement age under the Plan is age 59. Upon an employee's termination
or retirement, the funds in their account are distributed in the form of an
annuity, cash or stock.
The statement of net assets available for benefits as of December 31,
1998 and 1997, includes amounts pending distribution to participants of $43,170
and $34,431, respectively. (See Note 6 - Reconciliation of Financial Statements
to Form 5500.)
If a participant terminates employment prior to normal retirement age
for any reason other than death or disability, the participant's interest in
Company contributions to the Plan vests as follows:
Percent Of
Nonforfeitable
Years Of Service Interest
---------------- --------------
Less than one year 0%
One year 20
Two years 40
Three years 60
Four years 80
Five years 100
<PAGE>
ATGI 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1998
NOTE 1 - DESCRIPTION OF THE PLAN (CONTINUED)
FORFEITURES
After a participant's employment is terminated, any nonvested portion
of the participant's account can be used to offset administrative fees and the
Company's matching contribution, thus reducing future employer contributions.
Forfeitures included in net assets available for benefits at December 31, 1998
and 1997 amounted to $17,811 and $138,721, respectively. During the plan year
ended December 31, 1998, the Company used $110,088 of forfeiture monies for
employer contributions.
CONTRIBUTIONS
The Company's matching contribution is a discretionary amount to be
determined in advance each month by the Company. For 1998, the matching
contribution was equal to 50 percent of each participant's contribution not to
exceed 6 percent of the participant's compensation. The Company may also make
an additional discretionary contribution as determined by the Board of
Directors. No additional discretionary contribution was made for the year ended
December 31, 1998. Each participant's contribution is based upon a percentage
of annual compensation determined by the individual and is limited to the lesser
of 15 percent of the participant's compensation for the year or $10,000 in 1998,
as adjusted by the Internal Revenue Service for changes in the cost-of-living
pursuant to Section 402(g)(5) of the Internal Revenue Code. Each participant
may also contribute up to 10 percent of total compensation on an after-tax
basis. The combined pretax and after-tax contributions cannot exceed the Plan's
limitations. Participants are at all times fully vested in their contributions
and the appreciation or depreciation thereon.
PARTICIPANT LOANS
Plan participants may borrow Plan assets up to a maximum of the lesser
of $50,000 or 50 percent of their vested account balance in the Plan. Loans are
repaid in level installments through payroll deductions for periods ranging up
to five years or up to 15 years for the purchase of a primary residence. The
loans are secured by the participant's account to the extent of the principal
amount of the loan plus accrued interest.
TERMINATION OF THE PLAN
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of the Employee Retirement Income
Security Act of 1974 ("ERISA"). In the event of Plan termination, participants
will become 100 percent vested in their accounts.
<PAGE>
ATGI 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1998
NOTE 1 - DESCRIPTION OF THE PLAN (CONTINUED)
INVESTMENT OF FUNDS
There are eight funds in which participants can invest contributions
and in which other amounts are credited to participants' accounts as of
December 31, 1998:
ATGI Stock Fund - A fund that maintains a brokerage account with
Merrill Lynch and invests solely in the common stock of Alpha Technologies
Group, Inc.
Guaranteed Short-Term Account - A CIGNA fixed-income investment
account that invests primarily in Treasury securities, U.S. Government
securities, certificates of deposit, time deposits, repurchase agreements and
commercial paper issued by major domestic and foreign corporations.
Guaranteed Long-Term Account - A CIGNA fixed-income investment account
that invests primarily in commercial mortgages and private and public bonds with
an average life of 5.8 to 7.3 years.
Stock Market Index Account - A CIGNA pooled stock market index account
that is constructed to reflect the composition of the Standard and Poor's 500
index.
Growth Opportunities Account - A CIGNA separate account that invests
in the Fidelity Advisor Growth Opportunities Fund. The fund seeks to provide
capital growth by investing primarily in common stocks and securities
convertible into common stock.
Janus Fund - A CIGNA separate account that seeks long-term growth of
capital by investing primarily in a diversified portfolio of common stock.
PBHG Growth Fund - A CIGNA separate account which seeks capital
appreciation by investing primarily in common stock and securities convertible
into common stock of small capitalization companies.
American Century Fund - A CIGNA separate account that seeks capital
growth over time by investing in common stock.
<PAGE>
ATGI 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1998
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The accounting records of the ATGI 401(k) Plan are maintained on the
cash basis; however, the financial statements have been prepared on the accrual
basis of accounting.
ADMINISTRATIVE EXPENSES
Administrative expenses of the Plan are paid by the Plan. Forfeitures
of any nonvested portion of a participant's account can be used to offset
administrative fees.
INVESTMENTS
Pursuant to the Department of Labor's Rules and Regulations for
Reporting and Disclosure under ERISA, the Plan reports investments in the
financial statements at current market value in accordance with generally
accepted accounting principles. As of December 31, 1998 and 1997, the ATGI
Stock Fund is stated at aggregate market value based on quoted market prices for
the last trading day of the Plan year. All other funds, except the Guaranteed
Short-Term Account and the Guaranteed Long-Term Account, which are stated at
contract value, as of December 31, 1998 and 1997 are stated at aggregate market
value as determined by CIGNA.
INCOME TAXES
The Plan obtained its latest determination letter on February 27, 1995
in which the Internal Revenue Service stated that the Plan, as then designed,
was in compliance with the applicable requirements of the Internal Revenue Code.
The Plan has been amended since receiving the determination letter. However,
the Plan administrator and the Plan's tax counsel believe that the Plan is
currently designed and being operated in compliance with the applicable
requirements of the Internal Revenue Code. Therefore, no provision for income
taxes has been included in the Plan's financial statements.
ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles requires the Plan administrator to make estimates
and assumptions that affect certain reported amounts and disclosures.
Accordingly, actual results may differ from those estimates.
<PAGE>
ATGI 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1998
NOTE 3 - INVESTMENTS
During the year ended December 31, 1998, the Plan's investments (including
investments bought, sold, and held during the year) appreciated (depreciated) in
value as follows:
Alpha Technologies Group, Inc.
Common Stock $(503,659)
CIGNA Stock Market Index Account 293,858
CIGNA Growth Opportunities Account 368,217
CIGNA Janus Fund 144,784
CIGNA PBHG Growth Fund 9,385
CIGNA American Century Fund (7,075)
---------
$ 305,510
=========
Investments that represent 5 percent or more of the Plan's net assets
at December 31, 1998 and 1997, are separately identified below:
Market Or
Contract Value
Identity Of ----------------------
Party Involved Description 1998 1997
-------------- ----------- ---------- ----------
ATGI Stock Fund Equity securities $ - $ 775,916
CIGNA Guaranteed Short- Fixed-income
Term Account investment account - 376,592
CIGNA Guaranteed Long- Fixed-income
Term Account investment account 2,770,898 2,702,471
CIGNA Stock Market Pooled stock market
Index Account index account 1,405,743 1,089,992
CIGNA Growth Capital appreciation
Opportunities Account investment account 1,881,658 1,636,295
CIGNA Janus Fund Capital appreciation
investment account 642,302 -
<PAGE>
ATGI 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
December 31, 1998
NOTE 4 - NET ASSETS AVAILABLE FOR BENEFITS
The net assets available for benefits as of December 31, 1998 and 1997
consist of the following:
<TABLE>
<CAPTION>
December 31, 1998
---------------------------------------------------------------------------------
CIGNA
CIGNA CIGNA Stock
ATGI Guaranteed Guaranteed Market Growth PBHG
Stock Short-Term Long-Term Index Opportunities Janus Growth
Fund Account Account Account Account Fund Fund
----- ---------- ---------- ------- ------------- ----- ------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
------
Investments:
Investments, at market $380,331 $1,405,743 $1,881,658 $642,302 $416,604
Investments, at contract
value $371,761 $2,770,898
Participant loans
-------- -------- ---------- ---------- ---------- -------- --------
Total investments 380,331 371,761 2,770,898 1,405,743 1,881,658 642,302 416,604
-------- -------- ---------- ---------- ---------- -------- --------
Receivables:
Employer contributions 513 1,882 6,343 7,214 7,066 4,283 2,192
Participant contributions 970 4,571 18,384 16,334 19,726 13,532 5,056
-------- -------- ---------- ---------- ---------- -------- --------
Total receivables 1,483 6,453 24,727 23,548 26,792 17,815 7,248
-------- -------- ---------- ---------- ---------- -------- --------
Cash 25
-------- -------- ---------- ---------- ---------- -------- --------
Total assets 381,814 378,239 2,795,625 1,429,291 1,908,450 660,117 423,852
-------- -------- ---------- ---------- ---------- -------- --------
LIABILITIES
-----------
Administrative fees payable 4,045
----------
Total liabilities 4,045
-------- -------- ---------- ---------- ---------- -------- --------
Net assets available
for benefits $381,814 $378,239 $2,791,580 $1,429,291 $1,908,450 $660,117 $423,852
======== ======== ========== ========== ========== ======== ========
December 31, 1998
------------------------------
American
Century Total
Fund Loans For Plan
-------- ----- --------
<C> <C> <C>
Investments:
Investments, at market $47,458 $4,774,096
Investments, at contract 3,142,659
value $299,054 299,054
Participant loans ------- -------- ----------
Total investments 47,458 299,054 8,215,809
------- -------- ----------
Receivables:
Employer contributions 7,262 36,755
Participant contributions 11,008 89,581
------- ----------
Total receivables 18,270 126,336
------- ----------
Cash 25
------- -------- ----------
Total assets 65,728 299,054 8,342,170
------- -------- ----------
LIABILITIES
-----------
Administrative fees payable 4,045
------ -------- ----------
Total liabilities 4,045
----------
Net assets available
for benefits $65,728 $299,054 $8,338,125
======= ======== ==========
</TABLE>
<PAGE>
ATGI 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
December 31, 1998
NOTE 4 - NET ASSETS AVAILABLE FOR BENEFITS (CONTINUED)
<TABLE>
<CAPTION>
December 31, 1997
---------------------------------------------------------------------------------
CIGNA
CIGNA CIGNA Stock
ATGI Guaranteed Guaranteed Market Growth PBHG
Stock Short-Term Long-Term Index Opportunities Janus Growth
Fund Account Account Account Account Fund Fund
----- ---------- ---------- ------- ------------- ----- ------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
------
Investments:
Investments, at market $775,916 $1,089,992 $1,636,295 $271,825 $304,800
Investments, at contract
value $376,592 $2,702,471
Participant loans
-------- -------- ---------- ---------- ---------- -------- --------
Total investments 775,916 376,592 2,702,471 1,089,992 1,636,295 271,825 304,800
-------- -------- ---------- ---------- ---------- -------- --------
Receivables:
Employer contributions 7,478 2,384 7,426 5,472 8,712 5,339 3,481
Participant contributions 15,363 6,970 22,869 14,578 25,985 17,855 8,378
-------- -------- ---------- ---------- ---------- -------- --------
Total receivables 22,841 9,354 30,295 20,050 34,697 23,194 11,859
-------- -------- ---------- ---------- ---------- -------- --------
Cash 3,789
-------- -------- ---------- ---------- ---------- -------- --------
Total assets 798,757 389,735 2,732,766 1,110,042 1,670,992 295,019 316,659
-------- -------- ---------- ---------- ---------- -------- --------
LIABILITIES
-----------
Due to participants 22,830
Administrative fees payable 2,960
-------- -------- ---------- ---------- ---------- -------- --------
Total liabilities 25,790
-------- -------- ---------- ---------- ---------- -------- --------
Net assets available
for benefits $798,757 $389,735 $2,706,976 $1,110,042 $1,670,992 $295,019 $316,659
======== ======== ========== ========== ========== ======== ========
December 31, 1997
------------------------------
American
Century Total
Fund Loans For Plan
-------- ----- --------
<C> <C> <C>
Investments:
Investments, at market $32,432 $4,111,260
Investments, at contract
value 3,079,063
Participant loans $258,762 258,762
------- -------- ----------
Total investments 32,432 258,762 7,449,085
------- -------- ----------
Receivables:
Employer contributions 762 41,054
Participant contributions 2,530 114,528
------- ----------
Total receivables 3,292 155,582
------- ----------
Cash 3,789
------- -------- ----------
Total assets 35,724 258,762 7,608,456
------- -------- ----------
LIABILITIES
-----------
Due to participants 22,830
Administrative fees payable 2,960
------- -------- ----------
Total liabilities 25,790
------- -------- ----------
Net assets available
for benefits $35,724 $258,762 $7,582,666
======= ======== ==========
</TABLE>
<PAGE>
ATGI 401(k) PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
December 31, 1998
NOTE 5 - CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
Changes in net assets available for benefits for the year ended
December 31, 1998 consists of the following:
<TABLE>
<CAPTION>
For the Year Ended December 31, 1998
---------------------------------------------------------------------------------------
CIGNA
CIGNA CIGNA Stock
ATGI Guaranteed Guaranteed Market Growth PBHG
Stock Short-Term Long-Term Index Opportunities Janus Growth
Fund Account Account Account Account Fund Fund
----- ---------- ---------- ------- ------------- ----- ------
<S> <C> <C> <C> <C> <C> <C> <C>
Additions to net assets
attributed to:
Participant and employer
contributions $ 232,410 $ 87,042 $ 232,767 $ 278,449 $ 423,843 $244,277 $103,791
Interest and dividend income 1,974 15,051 157,447 6,098 3,062 8,001 4,665
Transfers among funds 18,070 (9,687) 137,097 (83,015) (69,457) 16,517 (175)
--------- -------- ---------- ---------- ---------- -------- --------
Total additions 252,454 92,406 527,311 201,532 357,448 268,795 108,281
--------- -------- ---------- ---------- ---------- -------- --------
Deductions from net
assets attributed to:
Benefit payments 151,325 88,589 320,775 150,178 477,355 66,104 24,806
Commissions and fees paid by
participants 17,682 481 4,284 3,241 1,781 1,461 244
Administrative expenses 33,914
Loans issued (3,269) 14,832 83,734 22,722 9,071 (19,084) (14,577)
--------- -------- ---------- ---------- ---------- -------- --------
Total deductions 165,738 103,902 442,707 176,141 488,207 48,481 10,473
--------- -------- ---------- ---------- ---------- -------- --------
Net realized and unrealized
appreciation (depreciation)
in fair value of investments (503,659) 293,858 368,217 144,784 9,385
Increase (decrease)
in net assets (416,943) (11,496) 84,604 319,249 237,458 365,098 107,193
Net assets available
for benefits:
Beginning of year 798,757 389,735 2,706,976 1,110,042 1,670,992 295,019 316,659
--------- -------- ---------- ---------- ---------- -------- --------
End of year $ 381,814 $378,239 $2,791,580 $1,429,291 $1,908,450 $660,117 $423,852
--------- -------- ---------- ---------- ---------- -------- --------
For the Year
December 31, 1998
------------------------------
American
Century Total
Fund Loans For Plan
-------- ----- --------
<C> <C> <C>
Additions to net assets
attributed to:
Participant and employer
contributions $ 58,018 $1,660,597
Interest and dividend income 61 196,359
Transfers among funds (9,350)
-------- ----------
Total additions 48,729 1,856,956
-------- ----------
Deductions from net
assets attributed to:
Benefit payments 11,935 $ 52,711 1,343,778
Commissions and fees paid by
participants 141 29,315
Administrative expenses 33,914
Loans issued (426) (93,003)
-------- -------- ----------
Total deductions 11,650 (40,292) 1,407,007
-------- -------- ----------
Net realized and unrealized
appreciation (depreciation)
in fair value of investments (7,075) 305,510
-------- -------- ----------
Increase (decrease)
in net assets 30,004 40,292 755,459
-------- -------- ----------
Net assets available
for benefits:
Beginning of year 35,724 258,762 7,582,666
-------- -------- ----------
End of year $ 65,728 $299,054 $8,338,125
======== ======== ==========
</TABLE>
<PAGE>
ATGI 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1998
NOTE 6 - RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of net assets available for benefits per
the financial statements to the Form 5500 for the years ended December 31, 1998
and 1997:
1998 1997
---- ----
Net assets available for benefits
per the financial statements $8,338,125 $7,582,666
Amounts allocated to withdrawing
participants (43,170) (34,431)
---------- ----------
Net assets available for benefits
per the Form 5500 $8,294,955 $7,548,235
========== ==========
The following is a reconciliation of benefits paid to participants per the
financial statements to the Form 5500 for December 31, 1998:
Benefits paid to participants
per the financial statements $1,343,778
Add: Amounts allocated to withdrawing
participants at December 31, 1998 43,170
Less: Amounts allocated to withdrawing
participants at December 31, 1997 (34,431)
----------
Benefits paid to participants
per the Form 5500 $1,352,517
==========
Amounts allocated to withdrawing participants are recorded on the Form 5500
for benefit claims that have been processed and approved for payment prior to
December 31, 1998 and 1997, but not yet paid as of that date.
NOTE 7 - EXCESS DEFERRALS DUE TO PARTICIPANTS
The Tax Reform Act of 1986 provides that plans such as the ATGI 401(k) Plan
cannot discriminate in favor of highly compensated individuals. As a result,
for the Plan year ended October 31, 1997, certain highly compensated individuals
received refunds of contributions in excess of Internal Revenue Code 401(k)
limits and all earnings attributable to such contributions. Excess deferrals of
$22,830 for the year ended October 31, 1997 are reflected as "due to
participants" on the statement of net assets available for benefits at December
31, 1997. There were no excess deferrals for the two-month period ending
December 31, 1997 or for the year ended December 31, 1998.
<PAGE>
ATGI 401(K) PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
DECEMBER 31, 1998
NOTE 8 - CONTRACT WITH INSURANCE COMPANY
The Plan holds a deposit administration contract with CIGNA. The Guaranteed
Long-Term (GLT) Account and the Guaranteed Short-Term (GST) Account are
unallocated funds. The GLT Account maintains a variable annualized rate, which
was 5.65 percent at December 31, 1998 and 1997. The GST Account maintains a
variable monthly rate, which was 3.50 percent and 4.05 percent annualized at
December 31, 1998 and 1997, respectively.
NOTE 9 - PLAN AMENDMENT
The Plan was amended effective January 1, 1998 to change the Plan year-end
from October 31 to December 31. In accordance with the Plan document, the short
plan year ended December 31, 1997 was considered a full year for vesting
purposes. Any employee that was employed on December 31, 1997, and was not
fully vested on that date, automatically experienced a 20 percent increase in
vesting for the short plan year period.
NOTE 10 - PARTIAL TERMINATION
The Company experienced a 26 percent reduction in eligible participants due
to involuntary terminations during the plan year ended December 31, 1998.
Pursuant to the Internal Revenue Code Section 411(d)(3), the affected
participants become 100 percent vested in their account balances.
<PAGE>
SCHEDULE I
ATGI 401(K) PLAN
LINE 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1998
EIN # 76-0079338
PLAN #001
<TABLE>
<CAPTION>
(A) (B) (C) (D) (E)
PARTY IN IDENTITY DESCRIPTION CURRENT
INTEREST OF ISSUE OF INVESTMENT COST VALUE
- ----------- ------------------- -------------------------- ---------- ----------
<S> <C> <C> <C> <C>
* Alpha Technologies
Group, Inc. ATGI Stock Fund $1,072,948 $ 380,331
* Connecticut General
Life Insurance
Company (A CIGNA
company) Accounts Guaranteed Short-Term
Account 371,761 371,761
Guaranteed Long-Term
Account 2,770,898 2,770,898
Stock Market Index Account 909,548 1,405,743
Growth Opportunities
Account 1,240,503 1,881,658
Janus Fund 489,234 642,302
PBHG Growth Fund 407,289 416,604
American Century Fund 53,879 47,458
Participant Prime plus 1% participant
Loans loans 0 299,054
</TABLE>
<PAGE>
SCHEDULE II
-----------
ATGI 401(K) PLAN
LINE 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1998
EIN # 76-0079338
PLAN #001
<TABLE>
<CAPTION>
(H)
CURRENT
(A) (G) VALUE OF
IDENTITY (B) (C) (D) COST ASSETS ON (I)
OF PARTY DESCRIPTION PURCHASE SELLING OF TRANSACTION NET GAIN
INVOLVED OF ASSETS PRICE PRICE ASSET DATE OR (LOSS)
- --------------- ----------- -------- ------- ----- ----------- --------
<S> <C> <C> <C> <C> <C> <C>
Alpha Technologies
Group, Inc. ATGI Stock Fund $333,839 - $333,839 $333,839 -
ATGI Stock Fund - $221,285 319,313 221,285 $(98,028)
Connecticut
General Life
Insurance
Company (A
CIGNA company)
accounts Guaranteed Long-Term
Account 608,859 - 608,859 608,859 -
Guaranteed Long-Term
Account - 694,485 694,485 694,485 -
Stock Market Index
Account 326,684 - 326,684 326,684 -
Stock Market Index
Account - 307,817 218,973 307,817 88,844
Growth Opportunities
Account 488,260 - 488,260 488,260 -
Growth Opportunities
Account - 614,044 443,741 614,044 170,303
Janus Fund 330,371 - 330,371 330,371 -
Janus Fund - 104,678 95,264 104,678 9,414
</TABLE>
<PAGE>
EXHIBIT INDEX
Sequentially
Exhibit Numbered
Number Description of Exhibit Page
- ------- ---------------------- -----------
1 Consent of Melton & Melton, L.L.P.
<PAGE>
Exhibit 1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference of our report included in this Form 11-K, into the Company's Form
S-8 Registration Statements filed on January 29, 1987 (Reg. No. 33-11627);
September 28, 1987 (Reg. No. 33-17359); March 17, 1988 (Reg. No. 33-20706); June
30, 1989 (Reg. No. 33-29636); June 23, 1992 (Reg. No. 33-48663); and April 30,
1996 (Reg. No. 333-03001); and S-3 Registration Statement filed on August 16,
1996 (Reg. No. 333-10311).
Houston, Texas
April 30, 1999 /s/ Melton & Melton, L.L.P.
