UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
_____________________________
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30, 2002
OR
[_] 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 0-25032
_____________________________
UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 25-1724540
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
600 Mayer Street
Bridgeville, PA 15017
(Address of principal executive offices, including zip code)
(412) 257-7600
(Telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No ______
---
As of August 8, 2002, there were 6,280,536 outstanding shares of the
Registrant's Common Stock, $.001 par value.
UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC.
This Quarterly Report on Form 10-Q contains historical information and
forward-looking statements. Statements looking forward are included in this Form
10-Q pursuant to the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995. They involve known and unknown risks and
uncertainties that may cause the Company's actual results in future periods to
differ materially from forecasted results. Those risks include, among others,
risks associated with the acquisition of the Empire Specialty Steel assets, and
the successful start-up of Dunkirk Specialty Steel, LLC, risks associated with
the receipt, pricing and timing of future customer orders, risks related to the
financial viability of customers, risks associated with the manufacturing
process and production yields, risks associated with the negotiation of a new
collective bargaining agreement with the hourly employees at the Bridgeville
facility, and risks related to property, plant and equipment. In the context of
forward-looking information provided in this Form 10-Q and in other reports,
please refer to the discussion of risk factors detailed in, as well as the other
information contained in, the Company's filings with the Securities and Exchange
Commission during the past 12 months.
DESCRIPTION PAGE NO.
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Condensed Statements of Operations 2
Consolidated Condensed Balance Sheets 3
Consolidated Condensed Statements of Cash Flows 4
Notes to the Unaudited Consolidated Condensed Financial Statements 5
Item 2. Management's Discussion and Analysis of Financial Condition and Results of 8
Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk 11
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders 12
Item 5. Other Information 12
Item 6. Exhibits and Reports on Form 8-K 12
SIGNATURES 13
1
Part I. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Dollars in Thousands, Except Per Share Information)
(Unaudited)
For the For the
Three-month period ended Six-month period ended
June 30, June 30,
------------------------ ----------------------
2002 2001 2002 2001
---- ---- ---- ----
Net sales $ 21,422 $ 24,233 $ 39,018 $ 45,492
Cost of products sold 18,574 19,207 32,819 36,328
Selling and administrative expenses 1,537 1,816 2,910 3,374
-------- -------- -------- --------
Operating income 1,311 3,210 3,289 5,790
Interest expense and other financing costs (118) (160) (228) (341)
Other income 31 2 62 22
-------- -------- -------- --------
Income before taxes 1,224 3,052 3,123 5,471
Income taxes 447 1,144 1,140 2,051
-------- -------- -------- --------
Net income $ 777 $ 1,908 $ 1,983 $ 3,420
======== ======== ======== ========
Earnings per common share
Basic $ 0.13 $ 0.31 $ 0.32 $ 0.56
======== ======== ======== ========
Diluted $ 0.12 $ 0.31 $ 0.32 $ 0.56
======== ======== ======== ========
The accompanying notes are an integral part of these consolidated financial
statements.
2
UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(Dollars in Thousands)
June 30, 2002 December 31, 2001
(Unaudited)
ASSETS
Current assets
Cash and cash equivalents $ 8,735 $ 5,454
Accounts receivable (less allowance for doubtful
accounts of $334 and $434) 15,001 13,257
Inventory 20,526 17,900
Other current assets 2,364 1,482
-------- --------
Total current assets 46,626 38,093
Property, plant and equipment, net 41,492 41,202
Other assets 177 151
-------- --------
Total assets $ 88,295 $ 79,446
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Trade accounts payable $ 6,231 $ 4,597
Outstanding checks in excess of bank balance 1,659 857
Current portion of long-term debt 1,871 1,832
Accrued employment costs 1,350 1,562
Other current liabilities 477 590
-------- --------
Total current liabilities 11,588 9,438
Long-term debt 8,440 6,490
Deferred taxes 7,609 7,146
-------- --------
Total liabilities 27,637 23,074
-------- --------
Commitments and contingencies -- --
Stockholders' equity
Senior Preferred Stock, par value $.001 per share;
liquidation value $100 per share; 2,000,000
shares authorized; 0 shares issued and
outstanding -- --
Common Stock, par value $.001 per share;
10,000,000 shares authorized; 6,550,436 and
6,347,172 shares issued 7 6
Additional paid-in capital 28,243 25,941
Retained earnings 34,039 32,056
Treasury Stock at cost; 269,900
common shares held (1,631) (1,631)
-------- --------
Total stockholders' equity 60,658 56,372
-------- --------
Total liabilities and stockholders' equity $ 88,295 $ 79,446
======== ========
The accompanying notes are an integral part of these consolidated financial
statements.
3
UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
For the Six-month period ended
June 30,
2002 2001
---- ----
Cash flow from operating activities:
Net income $ 1,983 $ 3,420
Adjustments to reconcile to net cash and cash equivalents
provided by operating activities:
Depreciation and amortization 1,539 1,310
Deferred taxes 543 472
Tax benefit from exercise of stock options 428 --
Changes in assets and liabilities:
Accounts receivable, net (1,744) (4,323)
Inventory 1,332 (2,272)
Trade accounts payable 1,634 1,641
Accrued employment costs (212) 537
Other, net (908) 982
-------- --------
Net cash provided by operating activities 4,595 1,767
-------- --------
Cash flows from investing activities:
Acquisition of assets and real property through purchase agreements (1,283) --
Capital expenditures (1,810) (2,395)
-------- --------
Net cash used in investing activities (3,093) (2,395)
-------- --------
Cash flows from financing activities:
Proceeds from the exercise of stock options 1,852 --
Proceeds from issuance of Common Stock 23 26
Borrowings under revolving line of credit -- 8,710
Repayments under revolving line of credit -- (8,516)
Proceeds from long-term debt -- 139
Repayments of long-term debt (898) (909)
Increase in outstanding checks in excess of bank balance 802 197
-------- --------
Net cash provided by (used in) financing activities 1,779 (353)
-------- --------
Net increase (decrease) in cash and cash equivalents 3,281 (981)
Cash and cash equivalents at beginning of period 5,454 1,109
-------- --------
Cash and cash equivalents at end of period $ 8,735 $ 128
======== ========
Supplemental disclosure of cash flow information:
Interest paid $ 165 $ 298
Income taxes paid $ 1,262 $ 1,264
The accompanying notes are an integral part of these consolidated financial
statements.
4
UNIVERSAL STAINLESS & ALLOY PRODUCTS, INC.
NOTES TO THE UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
Basis of Presentation
1) The accompanying unaudited consolidated condensed financial statements of
operations for the three- and six-month periods ended June 30, 2002 and
2001, balance sheets as of June 30, 2002 and December 31, 2001, and
statements of cash flows for the six-month periods ended June 30, 2002 and
2001 have been prepared in accordance with generally accepted accounting
principles for interim financial information. Accordingly, these
statements should be read in conjunction with the audited financial
statements as of and for the year ended December 31, 2001. In the opinion
of management, the accompanying unaudited, condensed consolidated
financial statements contain all adjustments, all of which were of a
normal recurring nature, necessary to present fairly, in all material
respects, the consolidated financial position at June 30, 2002 and
December 31, 2001 and the consolidated results of operations and of cash
flows for the periods ended June 30, 2002 and 2001, and are not
necessarily indicative of the results to be expected for the full year.
Acquisition
2) On February 8, 2002, the Company, through its wholly owned subsidiary,
Dunkirk Specialty Steel, LLC ("Dunkirk Specialty Steel"), entered into a
Personal Property Asset Purchase Agreement and a Real Property Purchase
Agreement (the "Purchase Agreements") with the New York Job Development
Authority (the "JDA") to acquire certain assets and real property formerly
owned by Empire Specialty Steel, Inc. at its idled production facility
located in Dunkirk, New York. These transactions were completed on
February 14, 2002, and the plant became operational on March 14, 2002.
Pursuant to the Purchase Agreements, Dunkirk Specialty Steel paid $1.1
million in cash and issued two ten-year, 5% interest bearing notes payable
to the JDA for the combined amount of $3.0 million. No principal or
interest payments are due under the notes during the first year. The
purchase price, including related acquisition costs and adjustments for
the discounted value of the JDA notes, of $4,140,000 was allocated as
follows (dollars in thousands):
Inventory $3,958
Assets Held for Sale 182
--------
$4,140
========
Common Stock
3) The reconciliation of the weighted average number of shares of Common
Stock outstanding utilized for the earnings per common share computations
are as follows:
5
For the For the
Three-month period ended Six-month period ended
June 30, June 30,
2002 2001 2002 2001
---- ---- ---- ----
Weighted average number of shares
of Common Stock outstanding 6,176,813 6,081,274 6,127,043 6,081,251
Assuming exercise of stock options
and warrants reduced by the
number of shares which could
have been purchased with the
proceeds from exercise of such
stock options and warrants 117,924 22,439 87,612 16,053
---------- ---------- ---------- ----------
Weighted average number of shares
of Common Stock outstanding,
as adjusted 6,294,737 6,103,713 6,214,655 6,097,304
========== ========== ========== ==========
Inventory
4) The major classes of inventory are as follows (dollars in thousands):
June 30, 2002 December 31, 2001
Raw materials and supplies $ 1,998 $ 1,880
Semi-finished and finished steel products 15,970 13,593
Operating materials 2,558 2,427
------------- ----------------
Total inventory $20,526 $17,900
============= ================
Property, Plant and Equipment
5) Property, plant and equipment consists of the following (dollars in
thousands):
June 30, 2002 December 31, 2001
Land and land improvements $ 822 $ 822
Buildings 5,471 4,701
Machinery and equipment 46,591 43,572
Construction in progress 631 2,641
------------- ----------------
53,515 51,736
Accumulated depreciation (12,023) (10,534)
------------- ----------------
Property, plant and equipment, net $ 41,492 $ 41,202
============= ================
Environmental
6) The Company has reviewed the status of its environmental contingencies and
believes there are no significant changes from that disclosed in the
Company's Annual Report on Form 10-K for the year ended December 31, 2001.
6
Business Segments
7.) Statement of Financial Accounting Standards (SFAS) 131, "Disclosures about
Segments of an Enterprise and Related Information", requires companies to
disclose segment information on the same basis as that used internally by
executive management to evaluate segment performance.
The Company is comprised of two business segments: Universal Stainless &
Alloy Products, which consists of the Bridgeville and Titusville facilities
and Dunkirk Specialty Steel, the Company's wholly owned subsidiary located
in Dunkirk, New York.
The Company manufactures and markets semi-finished and finished specialty
steel products, including stainless steel, tool steel and certain other
alloyed steels. Universal Stainless' manufacturing process involves
melting, remelting, treating and hot and cold rolling of semi-finished and
finished specialty steels. Dunkirk Specialty Steel's manufacturing process
involves hot rolling and finishing of specialty steel bar, rod and wire.
Sales between the segments are generally made at market-related prices.
Other income, net, represents interest income. Corporate assets are
primarily cash and cash equivalents, prepaid insurance costs, investment in
Dunkirk Specialty Steel and corporate operating assets.
Segment Data (dollars in thousands):
For the For the
Three-Month Period Ended Six-Month Period Ended
June 30, June 30,
2002 2001 2002 2001
----------- ----------- ----------- ----------
Net sales
Universal Stainless & Alloy Products $20,882 $24,233 $38,520 $45,492
Dunkirk Specialty Steel 2,173 -- 2,379 --
Intersegment (1,633) -- (1,881) --
----------- ----------- ----------- ----------
Consolidated net sales 21,422 24,233 39,018 45,492
----------- ----------- ----------- ----------
Operating income (loss)
Universal Stainless & Alloy Products 1,699 3,229 4,192 5,824
Dunkirk Specialty Steel (376) -- (882) --
Corporate costs (12) (19) (21) (34)
----------- ----------- ----------- ----------
Total operating income 1,311 3,210 3,289 5,790
----------- ----------- ----------- ----------
Interest expense and other financing costs (118) (160) (228) (341)
----------- ----------- ----------- ----------
Other income 31 2 62 22
----------- ----------- ----------- ----------
Consolidated income before taxes $ 1,224 $ 3,052 $ 3,123 $ 5,471
=========== =========== =========== ==========
June 30, December 31,
2002 2001
---- ----
Total assets:
Universal Stainless & Alloy Products $71,023 $73,225
Dunkirk Specialty Steel 6,573 --
Corporate assets 10,699 6,221
--------- ---------
Consolidated total assets $88,295 $79,446
========= =========
7
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND
RESULTS OF OPERATIONS
Results of Operations
An analysis of the Company's operations for the three-and six-month periods
ended June 30, 2002 and 2001 are as follows (dollars in thousands):
For the For the
Three-Month Period Ended Six-Month Period Ended
June 30, June 30,
2002 2001 2002 2001
----------- ----------- ----------- ----------
Net sales
Stainless steel $17,625 $21,200 $31,085 $38,623
Tool steel 1,950 848 3,284 2,365
High temperature alloy steel 721 326 2,464 935
High-strength low alloy steel 615 1,103 1,189 1,768
Conversion services 434 693 829 1,564
Other 77 63 167 237
---------- ----------- ----------- ----------
Total net sales 21,422 24,233 39,018 45,492
---------- ----------- ----------- ----------
Cost of products sold 18,574 19,207 32,819 36,328
---------- ----------- ----------- ----------
Selling and administrative expenses 1,537 1,816 2,910 3,374
---------- ----------- ----------- ----------
Operating income $ 1,311 $ 3,210 $ 3,289 $ 5,790
========== =========== =========== ==========
Three-and six-month periods ended June 30, 2002 as compared to the similar
periods in 2001
The decrease in net sales for the three-and six-month periods ended June 30,
2002 as compared to the similar periods in 2001 reflects lower demand for power
generation and aerospace products resulting from production cutbacks of power
generation equipment and commercial aircraft. These declines were partially
offset by an increase in demand for tool steel and commodity reroller products.
Management believes that the increased demand for tool steel products indicates
the anticipation of an improving economy, while the increased demand for
commodity reroller products reflects the impact of the tariffs imposed by
President Bush in March, 2002 on imported specialty steel products. The Company
shipped approximately 12,600 tons and 12,300 tons for the three-month periods
ended June 30, 2002 and 2001 respectively, and 21,000 tons and 23,300 tons for
the six-month periods ended June 30, 2002 and 2001, respectively.
Cost of products sold, as a percentage of net sales, was 86.7% and 79.3% for the
three-month periods ended June 30, 2002 and 2001, respectively, and was 84.1%
and 79.9% for the six-month periods ended June 30, 2002 and 2001, respectively.
This increase is primarily due to the shift in product mix and the start-up
costs incurred relating to Dunkirk Specialty Steel, the Company's wholly owned
subsidiary which acquired the assets of Empire Specialty Steel on February 14,
2002 and became operational March 14, 2002.
Selling and administrative expenses decreased by $279,000 in the three-month
period ended June 30, 2002 as compared to June 30, 2001 and decreased by
$464,000 for the six-month period ended June 30, 2002 as compared to June 30,
2001. This is primarily due to the recognition of a $300,000 bad debt charge
incurred in the three-month period ended June 30, 2001, a $190,000 severance
obligation to its former Vice President of Operations and a $100,000 investment
firm fee charged in the three-month period ended March 31, 2001.
Interest expense and other financing costs decreased by $42,000 in the
three-month period ended June 30, 2002 as compared to the three-month period
ended June 30, 2001 and decreased by $113,000 in the six-month period ended June
30, 2002 as compared to the six-month period ended June 30, 2001. The decreases
were primarily due to a reduction in borrowings under the revolving line of
credit with PNC Bank and lower interest rates between the two periods, partially
offset by the interest expense recognized on the debt issued in conjunction with
the acquisition of the Empire Specialty Steel assets.
8
The effective income tax rate utilized in the three-and six-month periods ended
June 30, 2002 and 2001 was 36.5% and 37.5%, respectively. The effective income
tax rate utilized in the current period reflects the anticipated effect of the
Company's permanent tax deductions against expected income levels in 2002.
Business Segment Results
An analysis of the net sales and operating income for the reportable segments
for the three-and six-month periods ended June 30, 2002 and 2001 is as follows
(dollars in thousands):
For the For the
Three-Month Period Ended Six-Month Period Ended
June 30, June 30,
2002 2001 2002 2001
----------- -------------- ---------------- ---------------
Net sales
Universal Stainless & Alloy Products $20,882 $24,233 $38,520 $45,492
Dunkirk Specialty Steel 2,173 -- 2,379 --
Intersegment (1,633) -- (1,881) --
----------- -------------- ---------------- ---------------
Consolidated net sales 21,422 24,233 39,018 45,492
----------- -------------- ---------------- ---------------
Operating income (loss)
Universal Stainless & Alloy Products 1,699 3,229 4,192 5,824
Dunkirk Specialty Steel (376) -- (882) --
Corporate costs (12) (19) (21) (34)
----------- -------------- ---------------- ---------------
Total operating income $ 1,311 $ 3,210 $ 3,289 $ 5,790
=========== ============== ================ ===============
Universal Stainless & Alloy Products Segment
Net sales for the three-and six-month periods ended June 30, 2002 for this
segment, which aggregates the Bridgeville and Titusville facilities, were $3.4
and $7.0 million lower, respectively, than the same periods a year ago. This
decrease reflects lower demand for power generation and aerospace products,
partially offset by an increase in demand for tool steel products and for
commodity reroller products, including shipments to the Dunkirk Specialty Steel
segment.
Operating income for the Universal Stainless & Alloy Products segment decreased
by $1.5 million in the three-month period ended June 30, 2002 as compared to
June 30, 2001 and decreased by $1.6 million for the six-month period ended June
30, 2002 as compared to June 30, 2001. This decrease was due primarily to the
shift in product mix.
Dunkirk Specialty Steel Segment
On February 8, 2002, the Company, through its wholly owned subsidiary, Dunkirk
Specialty Steel, entered into a Property Asset Purchase Agreement and a Real
Property Purchase Agreement (the "Purchase Agreements") with the JDA to acquire
certain assets and real property formerly owned by Empire Specialty Steel, Inc.
at its idled production facility located in Dunkirk, New York. These
transactions were completed on February 14, 2002. Dunkirk Specialty Steel
manufactures and markets finished bar, rod and wire specialty steel products.
The facility became operational on March 14, 2002.
Net sales for the three-and six-month periods ended June 30, 2002 for this
segment were $2.2 and $2.4 million, respectively. This primarily reflects sales
to service centers. The operating loss for the Dunkirk Specialty Steel segment
was $376,000 for the three-month period ended June 30, 2002 and $882,000 for the
six-month period ended June 30, 2002, which primarily relates to the start-up
costs incurred since February 14, 2002.
9
Financial Condition
The Company has financed its 2002 operating activities through cash flows from
operations and cash on hand at the beginning of the period. At June 30, 2002,
working capital approximated $35.0 million, as compared to $28.7 million at
December 31, 2001. The ratio of current assets to current liabilities was 4.0:1
at June 30, 2002 and December 31, 2001. The debt to capitalization was 14.5% at
June 30, 2002 and 12.9% at December 31, 2001.
The Company's capital expenditures, excluding the Dunkirk, NY acquisition,
approximated $1.8 million for the six-month period ended June 30, 2002, which
primarily related to the Bridgeville and Dunkirk facilities. At June 30, 2002,
the Company had outstanding purchase commitments in addition to the expenditures
incurred to date of approximately $2.7 million. The Company expended $1.3
million in connection with the Personal Property Asset and Real Property
Purchase Agreements entered into with the JDA to acquire certain assets and real
property formerly owned by Empire Specialty Steel, Inc. As of June 30, 2002, the
Company had $6.5 million available for borrowings under a revolving line of
credit with PNC Bank. On May 31, 2002, the Company entered into a fourth
amendment to the second amended and restated credit agreement with PNC Bank
which extended the term of the existing $6.5 million revolving credit facility
to April 30, 2004.
The Company issued 200,000 shares of Common Stock in the three-month period
ended June 30, 2002 associated with the exercise of stock options. The Company
received $1.9 million in cash and will receive a tax benefit of $428,000.
There were no shares of Common Stock repurchased by the Company during the
six-month period ended June 30, 2002. The Company is authorized to repurchase an
additional 45,100 shares of Common Stock as of June 30, 2002.
The Company anticipates that it will fund its 2002 working capital requirements,
its capital expenditures and the stock repurchase program primarily from funds
generated from operations and borrowings. The Company's long-term liquidity
requirements, including capital expenditures, are expected to be financed by a
combination of internally generated funds, borrowings and other sources of
external financing if needed.
2002 Outlook
The Company estimates that its sales for the third quarter of 2002 will be
between $18 and $22 million, versus sales of $23.3 million in the prior year
period. Diluted earnings per share for the third quarter of 2002 are currently
projected to range from $0.09 to $0.14, compared with $0.38 reported in the
third quarter of 2001. The following factors were considered in developing these
estimates:
.. The Company's backlog approximated $21 million on June 30, 2002 as
compared to $23 million on March 31, 2002.
.. Sales to the Company's reroller customers are expected to remain strong,
with commodity products again dominating the mix. Sales to the OEM and
forger markets are expected to be lower than in the prior year period as
a result of reduced demand from the power generation and aerospace
industries. Service center sales are expected to rise, primarily
resulting from the growth expected at Dunkirk Specialty Steel.
.. Sales from Dunkirk Specialty Steel are expected to reach approximately $5
million in the third quarter, compared with $2.2 million in the second
quarter and $206,000 in the first quarter of 2002. Dunkirk is expected to
reduce its level of operating losses during the third quarter as it
approaches its profitability threshold of $2 million in monthly sales.
.. The Company is continuing negotiations of a new labor agreement with its
hourly employees at the Bridgeville facility to replace the existing
agreement that expires August 31, 2002. In the event that a new agreement
between the parties is not reached prior to the expiration of the current
agreement, a work stoppage on the part of the represented employees is a
possibility and could have a material adverse affect on the Company's
financial results.
10
New Accounting Pronouncements
In April 2002, the Financial Accounting Standards Board ("FASB") issued
Statement No. 145, "Rescission of FASB Statements No. 4, 44 and 64, Amendment of
FASB Statement No. 13, and Technical Corrections". In June 2002, the FASB issued
Statement No. 146, "Accounting for Exit or Disposal Activities". These
statements will be adopted in 2003 and are not expected to impact the Company's
results of operations or financial condition.
Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
The Company has reviewed the status of its market risk and believes there are no
significant changes from that disclosed in the Company's Annual Report on Form
10-K for the year ended December 31, 2001, except as provided in this Form 10-Q.
11
Part II. OTHER INFORMATION
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The Annual Meeting of Stockholders of Universal Stainless & Alloy
Products, Inc. was held on May 21, 2002, for the purpose of electing a
board of directors, approving certain amendments to the Company's 1994
Stock Incentive Plan, and ratifying the appointment of auditors.
Proxies for meeting were solicited pursuant to section 14(a) of the
Securities Exchange Act of 1934 and there was no solicitation in
opposition to management's solicitation.
All of the management's nominees for directors as listed in the proxy
statement were elected by the following vote:
Shares Voted "For" Shares "Withheld"
D. Dunn 5,621,898 489,850
G. Keane 5,630,798 480,950
C. McAninch 5,524,698 587,050
U. Toledano 5,630,798 480,950
D. Wise 5,630,698 481,050
The amendments to the Company's 1994 Stock Incentive Plan were
approved by the following vote:
Shares Voted "For" Shares Voted "Against" Shares "Abstaining"
3,138,617 652,170 351,090
The appointment of PricewaterhouseCoopers LLP as independent auditors
was ratified by the following vote:
Shares Voted "For" Shares Voted "Against" Shares "Abstaining"
6,047,744 8,279 55,725
Item 5. OTHER INFORMATION
D. Leonard Wise tendered his resignation as a Director of the Company
effective June 16, 2002. The Board has not replaced Mr. Wise as of
this date.
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits.
10.26 Fourth Amendment to Second Amended and Restated Credit Agreement
dated May 31, 2002 by and between the Company and PNC Bank,
National Association (filed herewith).
b. No reports on Form 8-K were filed during the second quarter of 2002.
12
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
UNIVERSAL STAINLESS & ALLOY PRODUCTS,
INC.
Date: August 8, 2002 /s/ C. M. McAninch
------------------ --------------------------------------
Clarence M. McAninch
President, Chief Executive Officer and
Director (Principal Executive Officer)
Date: August 8, 2002 /s/ Richard M. Ubinger
------------------ --------------------------------------
Richard M. Ubinger
Vice President of Finance,
Chief Financial Officer and Treasurer
(Principal Financial and Accounting
Officer)
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Universal Stainless & Alloy Products,
Inc. (the "Company") on Form 10-Q for the period ended June 30, 2002 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
each of the undersigned, in the capacities and on the dates indicated below,
hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:
1. The Report fully complies with the requirements of Section 13(a) or 15(d)
of the Securities Exchange Act of 1934; and
2. The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operation of the Company.
UNIVERSAL STAINLESS & ALLOY PRODUCTS,
INC.
Date: August 8, 2002 /s/ C. M. McAninch
------------------ --------------------------------------
Clarence M. McAninch
President, Chief Executive Officer and
Director (Principal Executive Officer)
Date: August 8, 2002 /s/ Richard M. Ubinger
------------------ --------------------------------------
Richard M. Ubinger
Vice President of Finance,
Chief Financial Officer and Treasurer
(Principal Financial and Accounting
Officer)
13