SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 11-K
Annual Report Pursuant to Section 15(d) of the
Securities Exchange Act of 1934
For the fiscal years ended June 30, 1998 and 1997
Commission file number 33-13511
A. Full title of the plan and the address of the plan,
if different from that of the issuer named below:
UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC.
1996 EMPLOYEE STOCK PURCHASE PLAN
B. Name of the issuer of the securities held pursuant to the
plan and the address of its principal executive office:
UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC.
600 Mayer Street
Bridgeville, PA 15107
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UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC.
1996 EMPLOYEE STOCK PURCHASE PLAN
INDEX TO FINANCIAL STATEMENTS
Items 1. and 2. Financial Statements and Exhibits
a. Financial Statements: Pages
Report of Independent Accountants 3
Statement of Financial Condition as 4
of June 30, 1998 and 1997
Statement of Income and Changes in Plan Equity 5
for the fiscal years ended June 30, 1998 and 1997
Notes to the financial statements 6-7
b. Exhibits:
23.1 Consent of independent accountants
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Report of Independent Accountants
To the Board of Directors and Stockholders
of Universal Stainless & Alloy Products, Inc.
In our opinion, the accompnaying statement of financial condition and the
related statement of income and changes in Plan equity present fairly, in all
material respects, the financial condition of Universal Stainless & Alloy
Products, Inc. 1996 Employee Stock Purchase Plan (the Plan) at June 30, 1998 and
1997, and the income and changes in Plan equity for each of the two years in the
period ended June 30, 1998, in conformity with generally accepted accounting
priciples. These financial statements are the responsibility of the Company's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these statements in
accordance with generally accepted auditing standards which 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, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for the opinion expressed
above.
PricewaterhouseCoopers LLP
Pittsburgh, Pennsylvania
September 4, 1998
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<TABLE>
<CAPTION>
UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC.
1996 EMPLOYEE STOCK PURCHASE PLAN
STATEMENT OF FINANCIAL CONDITION
as of June 30, 1998 and 1997
<S> <C> <C>
1998 1997
-------- -------
Assets:
Cash $ 40,689 $ 1,248
-------- -------
Total assets $ 40,689 $ 1,248
======== =======
Liabilities and Plan equity:
Payable to Plan sponsor $ 34,148 $ 1,140
Refunds payable to Plan participants 6,384 -
-------- -------
Total liabilities 40,532 1,140
Plan equity 157 108
-------- -------
Total liabilities and Plan equity $ 40,689 $ 1,248
======== =======
The accompanying notes are an integral
part of the financial statements.
</TABLE>
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<TABLE>
<CAPTION>
UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC.
1996 EMPLOYEE STOCK PURCHASE PLAN
STATEMENT OF INCOME AND CHANGES IN PLAN EQUITY
for the fiscal years ended June 30, 1998 and 1997
<S> <C> <C>
1998 1997
--------- ----------
Additions:
Contributions by participating $ 84,492 $ 56,464
Interest on bank deposits 675 54
--------- ----------
Total additions 85,167 56,518
--------- ----------
Deductions:
Stock distributions 72,949 44,566
Participant withdrawals 11,494 11,790
Administrative costs 675 54
--------- ----------
Total deductions 85,118 56,410
--------- ----------
Net increase in Plan equity 49 108
Plan equity, beginning of year 108 -
--------- ----------
Plan equity, end of year $ 157 $ 108
========== ==========
The accompanying notes are an integral
part of the financial statements.
</TABLE>
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UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC.
1996 EMPLOYEE STOCK PURCHASE PLAN
NOTES TO THE FINANCIAL STATEMENTS
June 30, 1998 and 1997
1. Description of the Plan
The Universal Stainless & Alloy Products, Inc. ("the Company") 1996 Employee
Stock Purchase Plan (the "Plan") was adopted by the stockholders of the
Company on May 22, 1996 for the benefit of substantially all employees of
the Company. The Plan was established to enable eligible employees of the
Company to acquire an ownership interest in the Company. The aggregate
number of shares of common stock which may be purchased under the Plan shall
not exceed 90,000 shares. The Plan is intended to be an employee stock
purchase plan, as defined by Section 423 of the Internal Revenue Code.
Purchase rights are generally granted with respect to six-month purchase
periods and are limited to the lessor of (i) 100 shares, (ii) the maximum
number of whole shares that could be purchased by an amount equal to 10
percent of an employee's base compensation paid during the purchase period,
or (iii) a pro-rata share of the shares remaining in the aggregate
authorization under the Purchase Plan. The purchase price for shares subject
to the purchase right is the lessor of (i) 85 percent of the closing market
price of such stock on the date of the grant of the purchase right,
generally the day preceding the beginning of a six-month purchase period, or
(ii) 85 percent of the closing market price of such stock on the date the
purchase price is exercised, generally the last day of the six-month
purchase period. No cash consideration is received for the granting of
purchase rights.
No employee may be granted a purchase right under the Plan if the employee,
immediately after the purchase right is granted, owns stock possessing five
percent or more of the total combined voting power or value of all classes
of stock of the Company. Also, no employee may purchase shares under the
Plan in excess of $25,000 of fair market value of such shares on the date of
grant of the purchase right.
Employees may elect to participate by filing an enrollment form and
authorizing payroll deductions of up to 10 percent of their base
compensation; provided, however, that such amount may not exceed 100 shares
multiplied by 85 percent of the fair market value of a share of company
stock on the date of the grant of the purchase right. Payroll deductions
begin with the first paycheck received after commencement of the relevant
purchase period and end with the last paycheck received within the purchase
period. The shares of stock subject to the purchase right are automatically
purchased on the last day of the purchase period by applying the accumulated
payroll deductions to the purchase of whole shares of common stock. Any
amount remaining after the purchase of the maximum amount of whole shares is
recorded as Plan equity and applied to the next purchase period; provided,
however, if the employee purchased 100 shares during the purchase period,
the balance is refunded.
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The Board of Directors of the Company has the power to terminate or amend
the Plan at any time. If the Board does not take action to terminate the
Plan earlier, the Plan will terminate on the last day of the first purchase
period ending in 2005 or the date on which all shares available for issuance
under the Plan have been sold pursuant to the purchase rights exercised
under the Plan.
2. Summary of Significant Accounting Policies:
Security Transactions
Security transactions are accounted for as of the last day of each six-month
purchase period. Securities are issued directly by the Company to the
participants of the Plan from unissued shares designated for the Plan, and a
corresponding liability to the Plan sponsor is recorded. The Plan does not
hold the securities as temporary investments. For the fiscal years ended
June 30, 1998 and 1997, 7,827 and 5,990 shares were issued, respectively.
Since inception of the Plan, 13,817 of the designated shares have been
issued. The valuation of securities distributed is at cost determined in
accordance with the Plan.
Contributions and Deposits
Employee contributions are recorded on the accrual basis as of the date the
contributions are withheld from the employees' compensation. Contributions
to the Plan are initially invested in an interest-bearing account pending
their investment in the Company's stock. Interest earned on such cash
balances is returned to the Company to partially offset administrative costs
of the Plan.
Withdrawals and Refunds
Participant withdrawals from the Plan may occur at the election of the
Participant, upon termination of employment or as a refund of contributions
made in excess of the value of stock distributed during each purchase
period. Participant withdraws equal the cash contributed to the Plan less
the value of stock distributed to the Participant.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the members of the Board of Directors who administer the Plan have duly caused
this annual report to be signed by the undersigned hereunto duly authorized.
UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC.
1996 EMPLOYEE STOCK PURCHASE PLAN
SIGNATURE TITLE DATE
/s/ Richard M. Ubinger
- ---------------------- PLAN ADMINISTRATOR SEPTEMBER 29, 1998
RICHARD M. UBINGER
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EXHIBIT 23
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the
Registration Statement on Form S-8 (File No. 33-13511) of Universal Stainless &
Alloy Products, Inc. of our report dated September 4, 1998, which appears on
page 3 of the Annual Report of the Universal Stainless & Alloy Products, Inc.
1996 Employee Stock Purchase Plan for the years ended June 30, 1998 and 1997,
included in this Annual Report on Form 11-K.
PricewaterhouseCoopers LLP
Pittsburgh, Pennsylvania
September 25, 1998
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