10KSB 1 winco01.txt 2001 WINMILL & CO. INCORPORATED ANNUAL REPORT As filed with the Securities and Exchange Commission on April 1, 2002 --------------------------------------------------------------------- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-KSB (Mark One) X Annual Report Pursuant to Section 13 or 15(d) of the ---------- Securities Exchange Act of 1934 [Fee Required] For the fiscal year ended December 31, 2001 or ---------- Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 [No Fee Required] For the Transition Period From ___________ to ___________ Commission File Number 0-9667 WINMILL & CO. INCORPORATED, (Exact name of registrant as specified in its charter) Delaware 13-1897916 (State of incorporation) (I.R.S. Employer Identification No.) 11 Hanover Square, New York, New York 10005 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (212) 785-0900 Securities registered pursuant to Section 12(b) of the Act: Title of each class Name of each exchange on which registered ------------------- ----------------------------------------- None None Securities registered pursuant to Section 12(g) of the Act: Class A Common Stock, Par Value $.01 Per Share 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 [ ]. Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-B 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 IV of this Form 10-KSB or any amendment to this Form 10-KSB. [X] No voting stock was held by non-affiliates of the registrant as of March 15, 2002. The number of shares outstanding of each of the registrant's classes of common stock, as of March 15, 2002: Class A Non-Voting Common Stock, par value $.01 per share - 1,628,830 shares Class B Voting Common Stock, par value $.01 per share - 20,000 PART I ITEM PAGE 1. Business 1 2. Properties 5 3. Legal Proceedings 5 PART II 4. Market for Company's Common Equity and Related Stockholder Matters 6 PART III 5. Management's Discussion and Analysis of Financial Condition and Results of Operations 6 6. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 8 7. Financial Statements and Supplementary Data 9 PART IV 8. Directors and Executive Officers 25 9. Executive Compensation 27 10. Security Ownership of Certain Beneficial Owners and Management 33 11. Certain Relationships and Related Transactions 33 PART V 12. Exhibits, Consolidated Financial Statements and Schedules, and Reports on Form 8-K 34 PART I Item 1. Business Winmill & Co. Incorporated, a Delaware corporation (the "Company"), is a holding company with five principal subsidiaries: CEF Advisers, Inc., ("CEF"), Investor Service Center, Inc. ("ISC"), Midas Management Corporation ("MMC") and Performance Properties, Inc. ("Performance Properties"). MMC and CEF act as investment managers to open-end and closed-end management investment companies (the "Funds") registered under the Investment Company Act of 1940 (the "Act"). The open-end Funds are: Dollar Reserves, Inc., Midas Fund, Inc.; and Midas Special Equities Fund, Inc. The closed-end fund is Global Income Fund, Inc. CEF acted as investment manager of Bexil Corporation ("Bexil") and Tuxis Corporation ("Tuxis") until July 31, 2001 and November 30, 2001, respectively, when the investment management agreements with CEF were terminated. Commencing August 1, 2001, Bexil's officers (who are substantially identical to those of CEF) assumed the internal management of Bexil's affairs, including portfolio management, subject to the oversight and final direction of the Board of Directors of Bexil. Commencing December 1, 2001, the officers of Tuxis (who are substantially identical to those of CEF) assumed the internal management of Tuxis' affairs, including portfolio management, subject to the oversight and final direction of the Board of Directors of Tuxis. Compensation of Bexil and Tuxis personnel was set in the aggregate amount of $200,000 each per year which may be changed from time to time at the discretion of the Board of Directors of each of Bexil and Tuxis. Bexil and Tuxis are paying compensation directly to the officers whose compensation from the Company was proportionately reduced. As of December 31, 2001, the Company owned approximately 23% and 19% of the outstanding shares of Bexil and Tuxis, respectively. Bexil and Tuxis have received shareholder approval to change from registered investment companies to operating companies and each anticipates filing with the SEC an application to terminate its registration as an investment company. In January 2002, Bexil began operating a business through a 50% interest in a third party claims administrator. ISC was organized in 1985 and is registered with the SEC as a broker/dealer and is a member of the NASD. ISC acts as the principal distributor for the open-end Funds and may engage in proprietary trading. Performance Properties was organized in 1994 to purchase and renovate suburban office buildings. Performance Properties purchased land and a two story office building located in Red Bank, New Jersey in 1994. The building consisted of approximately 13,000 square feet. The building was purchased for cash and had no mortgage. The office building was sold on December 1, 2000 for $2,250,000 for a pre-tax profit of $901,046. On March 31, 1999, the Company sold the outstanding stock of Bull & Bear Securities, Inc. ("BBSI"), to a wholly-owned subsidiary of Royal Bank of Canada. In connection with the sale, the rights to the name "Bull & Bear" were transferred to Royal Bank of Canada, and the Company and certain of its subsidiaries agreed to change their names. In connection with the BBSI Sale, Royal Bank had agreed that it will cause, for the three-year period following the closing, BBSI to offer exclusively Dollar Reserves, an open-end investment company managed by MMC, to its customers as the sole money market fund into which cash balances held by BBSI's customers may be swept on a daily basis for so long as certain conditions are met, including certain performance rankings by the Fund, in consideration of a monthly fee equal to one-twelfth of 0.25% of the aggregate average daily amount of such balances. Further, the Company had agreed to provide, or to cause its subsidiaries to provide, to BBSI for a period of three years following the closing, certain services with respect to the operation of a securities brokerage business for a monthly consulting fee of $16,666.67, subject to certain conditions. The agreement was terminated by Royal Bank in June 2001. The Company received a settlement for the consulting agreement in the amount of approximately $164,000. -1- See Note 11 to the financial statements for financial information by business segment. The Company has granted certain of the Funds, Tuxis, Bexil and its subsidiaries a non-exclusive license to use certain service marks owned by the Company, under certain terms and conditions on a royalty free basis. Such license may be withdrawn from a Fund in the event the investment manager of the Fund is not a subsidiary of the Company or in other cases, at the discretion of the Company. Investment Management and Distribution Business The Company is engaged, through its subsidiaries, in the business of managing investment companies registered under the Act. The Funds and their respective net assets as of December 31, 2001 were approximately as follows: Dollar Reserves, Inc. $ 25,991,000 Global Income Fund, Inc. 29,110,000 Midas Fund, Inc. 38,558,000 Midas Special Equities Fund, Inc. 22,695,000 ---------------- Total Net Assets $ 116,354,000 ================ The fund management industry along with the entire financial services sector of the economy has been rapidly changing to meet the increasing needs of investors. Competition for management of financial resources has increased as banks, insurance companies and broker/dealers have introduced products and services traditionally offered by independent fund management companies. There are also many fund management groups with substantially more resources than the Company. While the Company's business is not seasonal, it is affected by the financial markets, which in turn, are dependent upon current and future economic conditions. Drastic material declines in the securities markets can have a significant effect on the Company's business. Volatile stock markets may affect management and distribution fees earned by the Company's subsidiaries. If the market value of securities owned by the Funds declines, assets under management will decline and shareholder redemptions may occur, either by transfer out of the equity Funds and into the money market Fund, Dollar Reserves, which has lower management and distribution fee rates than the equity Funds, or by redemptions out of the Funds entirely. Lower asset levels in the Funds may also cause or increase reimbursements to the Funds pursuant to the expense limitations described below. -2- In general, investment management services are rendered to the Funds pursuant to written contractual agreements. Such agreements relate to the general management of the affairs of each Fund, in addition to supervising the acquisition and sale of each Fund's portfolio investments. As provided in the agreements, CEF and MMC may receive management fees ranging from 1.0% to 0.5% (and generally declining thereafter on higher net asset levels) per annum of the Funds' average daily or average weekly net assets payable monthly. The Act requires that such contractual agreements be initially approved by the Funds' Board of Directors, including a majority of all of the directors who are not "interested persons" (as defined in the Act), and by the vote of a majority of the outstanding shares of the Fund (as defined in the Act). Agreements, if approved, may be for a term of up to two years, and thereafter their continuance must be approved at least annually by a majority of the directors of the Fund, including a majority of those directors of the Fund who are not "interested persons", or by such a vote of "disinterested" directors and the vote of a majority of the outstanding shares of the Fund. In addition, all such agreements are subject to termination on 60 days' notice by majority vote of the Board of Directors or the shareholders and are subject to automatic termination in the event of assignment. Effective July 31, 2001, the investment management agreement with Bexil was terminated by the Board of Directors of Bexil and Bexil's officers assumed the internal management of Bexil's affairs, including portfolio management. Effective November 30, 2001, the investment management agreement with Tuxis was terminated by the Board of Directors of Tuxis and Tuxis' officers assumed the internal management of Tuxis' affairs, including portfolio management. Depending on the assets of the Fund involved and other factors, the termination of any agreements for investment management services between any of the Funds, CEF, and MMC or the termination of the relationship of the Company with the management of Bexil and Tuxis may have a serious adverse impact upon the Company. Under the investment management contracts, CEF and MMC are required to reimburse the Funds for certain expenses to the extent that such expenses exceed limitations prescribed by any state in which shares of the Funds are qualified for sale, although currently the Funds are not subject to any such limits. In addition, from time to time CEF and MMC may waive or reimburse management fees to increase a Fund's performance. Each of the open-end Funds has adopted a plan of distribution pursuant to Rule 12b-1 under the Act (the "Plan"). Pursuant to the Plans, ISC may receive as compensation amounts ranging from one-quarter of one percent to one percent per annum of the Funds' average daily net assets for distribution and service activities. The service fee portion is intended to cover services provided to shareholders in the Funds and the maintenance of shareholder accounts. The distribution fee portion is to cover all other activities and expenses primarily intended to result in the sale of the Funds' shares. The Act requires that a plan of distribution be initially approved by the Fund's Board of Directors, including a majority of the directors who are not "interested persons" and who have no financial interest in the Plan, and by the vote of a majority of the outstanding shares of the Fund. If approved, a plan of distribution may be for a term of one year, and thereafter it must be approved at least annually by the entire Board of Directors and by a majority of the "disinterested" directors. In addition, all plans of distribution are subject to termination at any time by majority vote of the disinterested directors or shareholders. CEF and MMC are registered with the SEC as investment advisers under the Investment Advisers Act of 1940. ISC is registered with the SEC as a broker/dealer under the Securities Exchange Act of 1934 and is a member of the NASD. The Funds, Tuxis and Bexil are registered with the SEC under the Act. The activities of CEF and MMC and of the Funds are subject to regulation under Federal and state securities laws. The provisions of these laws, including those relating to the contractual arrangements between the Funds and their investment managers, are primarily designed to protect the shareholders of the Funds and not the shareholders of the Company. -3- Forward-Looking Information Information or statements provided by or on behalf of the Company from time to time, including those within this Form 10-KSB Annual Report, may contain certain "forward-looking information", including information relating to anticipated growth in revenues or earnings per share, anticipated changes in the amount and composition of assets under management, anticipated expense levels, and expectations regarding financial market conditions. The Company cautions readers that any forward-looking information provided by or on behalf of the Company is not a guarantee of future performance and that actual results may differ materially from those in forward-looking information as a result of various factors, including but not limited to those discussed below. Further, such forward-looking statements speak only as of the date on which such statements are made, and the Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. The Company's future revenues may fluctuate due to factors such as: the total value and composition of assets under management and related cash inflows or outflows in mutual funds; fluctuations in the financial markets resulting in appreciation or depreciation of assets under management; the relative investment performance of the Company's sponsored investment products as compared to competing products and market indices; the expense ratios and fees of the Company's sponsored products and services; investor sentiment and investor confidence in mutual funds; the ability of the Company to maintain investment management fees at current levels; competitive conditions in the mutual funds industry; the introduction of new mutual funds and investment products; the ability of the Company to contract with the Funds for payment for services offered to the Funds and Fund shareholders; the continuation of trends in the retirement plan marketplace favoring defined contribution plans and participant-directed investments; and the amount and timing of income from the Company's proprietary securities trading portfolio. The Company's future operating results are also dependent upon the level of operating expenses, which are subject to fluctuation for the following or other reasons: changes in the level of advertising expenses in response to market conditions or other factors; the level of expenses assumed by the Company for the Funds as a result of expense reimbursement plan or waiver of expenses to increase a Fund's performance; variations in the level of compensation expense incurred by the Company, including performance-based compensation based on the Company's financial results, as well as changes in response to the size of the total employee population, competitive factors, or other reasons; expenses and capital costs, including depreciation, amortization and other non-cash charges, incurred by the Company to maintain its administrative and service infrastructure; and unanticipated costs that may be incurred by the Company from time to time to protect investor accounts and client goodwill. The Company's operating results will also depend on the results of its holdings in Bexil and Tuxis. The Company's revenues are substantially dependent on revenues from the Funds, which could be adversely affected if the independent directors of one or more of the Funds determined to terminate or renegotiate the terms of one or more investment management agreements. The Company's business is also subject to substantial governmental regulation, and changes in legal, regulatory, accounting, tax, and compliance requirements may have a substantial effect on the Company's business and results of operations, including but not limited to effects on the level of costs incurred by the Company and effects on investor interest in mutual funds in general or in particular classes of mutual funds. -4- Item 2. Properties The principal office of the Company is located at 11 Hanover Square, New York, New York 10005. The approximate area of the office is 3,800 square feet. The rent is approximately $96,000 per annum plus $12,800 per annum for electricity. The lease expires on December 31, 2003. Item 3. Legal Proceedings From time to time, the Company and/or its subsidiaries are threatened or named as defendants in litigation arising in the normal course of business. As of December 31, 2001, neither the Company nor any of its subsidiaries was involved in any other litigation that, in the opinion of management, would have a material adverse impact on the consolidated financial statements. -5- PART II Item 4. Market for the Company's Common Equity and Related Stockholder Matters The Company's Class A Common Stock (non-voting) trades on the Nasdaq SmallCap Market tier of the Nasdaq Stock Market under the symbol WNMLA. The Company's Class B Common Stock (voting) has no public trading market. There are approximately 237 holders of record of Class A Common Stock and 1 holder of Class B Common Stock as of December 31, 2001. In addition, there are an indeterminate number of beneficial owners of Class A Common Stock that are held in "street name". No dividends have been paid on either class of Common Stock in the past five years and the Company does not expect to pay any such dividends in the foreseeable future. The high and low sales prices of the Class A Common Stock during each quarterly period over the last two years were as follows: 2001 2000 -------------------- --------------------- High Low High Low First Quarter $1.6250 $1.1563 $2.2188 $1.9375 Second Quarter $1.8900 $1.3000 $2.0625 $1.6250 Third Quarter $1.9400 $1.5500 $2.0938 $1.8125 Fourth Quarter $1.7000 $1.3500 $1.9375 $1.0000 Equity Compensation Plan Information
Number of Number of Class A Weighted- Class A shares shares to be issued average price remaining available upon exercise of of outstanding for future issuance outstanding options options, warrants under equity warrants and rights and rights compensation plans Equity Compensation Plans approved by security holders 221,000 $ 1.60 84,000 Equity Compensation Plans not approved by security holders - - - --------- ------ -------- Total 221,000 $ 1.60 84,000 ========= ====== ========
Item 5. Management's Discussion and Analysis of Financial Condition and Results of Operations 2001 Compared to 2000 Drastic declines in the securities markets can have a significant effect on the Company's business. Volatile stock markets may affect management and distribution fees earned by the Company's subsidiaries. If the market value of securities owned by the Funds declines, shareholder redemptions may occur, either by transfer out of the equity Funds and into the money market fund, which has lower management and distribution fees rates than the equity Funds, or by transfer out of the Funds entirely. Lower net asset levels in the Funds may also cause or increase reimbursements to the Funds pursuant to expense limitations as described in Note 10 of the financial statements. -6- Total revenues decreased $2,253,399 or 54% which was primarily due to the decrease in management, distribution and other fees, net realized and unrealized gains on proprietary securities trading, rental income and dividends and interest income. Management, distribution and other fees decreased $526,278 or 23% due to lower net assets in the Funds and the termination of the investment management agreement with Bexil and Tuxis effective July 31, 2001 and November 30, 2001 respectively. Net assets under management were approximately $181 million at December 31, 2000, $172 million at March 31, 2001 $140 million at June 30, 2001, $128 million at September 30, 2001 and $116 million at December 31, 2001. Net realized and unrealized losses on proprietary securities trading were $360,418. Consulting fees increased $46,923 which was primarily due to the termination and settlement of the Company's consulting agreement with BBSI during the second quarter of 2001. Rental income declined to $0 as compared to $250,941 due to the sale of the real estate held for investment in December 2000 for a pre-tax profit of $901,046. Total expenses decreased $977,041 or 31% over this period of last year, as a result of decreases in general and administrative expense of $373,560 or 29%, marketing expenses of $230,925 or 24%, and amortization and depreciation expense of $32,865 or 26%. General and administrative expenses decreased due to lower employee costs, in part due to the assumption by Bexil, effective August 1, 2001, of compensation expense of certain Company personnel at the annual rate of $200,000. Marketing expense decreased due to lower fulfillment and printing costs. Expense reimbursement to the Funds decreased $3,180 or 1%. Professional fees decreased $11,511 or 6%. Net loss for the period was $199,065 or $(.12) per share on a diluted basis as compared to net income of $508,314 or $.31 per share on a diluted basis for last year. 2000 Compared to 1999 Total revenues for the year increased $862,885 or 26% reflecting primarily the pre-tax gain realized on the sale of real estate of $901,046. Management, distribution and other fees decreased $398,745 or 21% and $171,352 or 18%, respectively. The decrease in management, distribution and other fees was due to an overall decrease in the net asset levels of the Funds. Net assets under management were approximately $244 million at December 31, 1999, $222 million at March 31, 2000, $198 million at June 30, 2000, $189 million at September 30, 2000 and $181 million at December 31, 2000. Rental income increased $34,670 or 16%. In 2000, the Company earned $200,000 in consulting fees from BBSI in connection with the sale of BBSI in 1999. Dividends, interest and other income increased $57,219 or 17% due to higher earnings from the Company's investments. The Company had net realized and unrealized gains of $139,154 from the Company's marketable securities which included certain investments in Funds managed by the Company. Total expenses decreased $41,527 or 1%. General and administrative expenses decreased $43,027 or 2%. Marketing expenses decreased $141,413 or 30% due to lower fulfillment expenses and lower payments to other brokers for distributing the Company's open-end Funds. Expense reimbursements to the Funds decreased $41,281 or 13% due to lower waivers of management and distribution fees in certain Funds. Effective December 1, 1999, the Midas Fund's subadvisory agreement was discontinued, resulting in decreased subadvisory fees of $147,157. Professional fees increased $33,298 or 21%. Depreciation and amortization decreased $26,947 or 18%. In 2000, the Company determined that the carrying value of one of its intangible assets exceeded its net realizable value and recorded a non-recurring charge of $325,000 to operations. Net income from continuing operations for the year was $508,314 or $.31 per share on a diluted basis as compared to net income from continuing operations of $48,776 or $.03 per share on a diluted basis for 1999. Net income for the year was $508,314 or $.31 per share on a diluted basis as compared to net income of $2,528,641 or $1.51 per share on a diluted basis in 1999 which included a net gain from discontinued operations of $2,479,865 or $1.48 per share on a diluted basis. -7- Liquidity and Capital Resources The following table reflects the Company's consolidated working capital, total assets, long-term debt and shareholders' equity as of the dates indicated. December 31, 2001 2000 ---- ---- Working Capital $7,063,441 $7,132,886 Total Assets $8,036,785 $8,377,222 Long-Term Debt $ - $ - Shareholders' Equity $7,748,846 $7,961,746 For the year ended 2001, working capital, total assets and shareholders' equity decreased $69,445, $340,437 and $212,900, respectively. Working capital, total assets and shareholders' equity decreased primarily due to the realized and unrealized losses from proprietary securities trading. For the year ended 2000, working capital and shareholders' equity increased $1,778,608, and $123,111, respectively. Total assets decreased $1,712,807. Total assets decreased primarily due to the payment of federal, state and local income taxes in the first quarter of 2000 and the write-down of intangible assets of $325,000. Working capital increased due to the sale of real estate held for investment in the fourth quarter of 2000. The increase in shareholders' equity was primarily the result of the net income for 2000 of $508,314 offset by the decrease in unrealized capital gains from proprietary securities trading of $385,203. Management knows of no contingencies that are reasonably likely to result in a material decrease in the Company's liquidity or that are likely to adversely affect the Company's capital resources. This includes the restrictions placed on the transfer of funds to ISC as a result of its regulatory net capital requirements. At December 31, 2001, the amount subject to these restrictions was $100,000 or 1.2% of total assets. Effects of Inflation and Changing Prices Since the Company derives revenue primarily from investment management and distribution services from the Funds, it is not possible for it to discuss or predict with accuracy the impact of inflation and changing prices on its revenues from continuing operations. Item 6. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure There were no changes in or disagreements with the Company's accountants on accounting and financial disclosure matters during the two years ended December 31, 2001. -8- Item 7. Financial Statements and Supplementary Data Financial Statements required by Regulation S-X and Supplementary Financial Information required by Regulation S-B are presented herein. FINANCIAL STATEMENTS AND SUPPORTING SCHEDULES TABLE OF CONTENTS Page Report of Independent Certified Public Accountants 10 Consolidated Balance Sheet, December 31, 2001 11 Consolidated Statements of Income, Years ended December 31, 2001 and 2000 12 Consolidated Statements of Changes in Shareholders' Equity, Years ended December 31, 2001 and 2000 13 Consolidated Statements of Cash Flows, Years ended December 31, 2001 and 2000 14 Notes to Consolidated Financial Statements 16 -9- REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS The Board of Directors and Shareholders of Winmill & Co. Incorporated We have audited the accompanying consolidated balance sheet of Winmill & Co. Incorporated and subsidiaries as of December 31, 2001, and the related consolidated statements of income, changes in shareholders' equity, and cash flows for each of the two years in the period ended December 31, 2001. These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. 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 consolidated financial position of Winmill & Co. Incorporated and subsidiaries at December 31, 2001, and the consolidated results of their operations and their consolidated cash flows for each of the two years in the period ended December 31, 2001, in conformity with accounting principles generally accepted in the United States of America. TAIT, WELLER & BAKER Philadelphia, Pennsylvania February 8, 2002 -10- WINMILL & CO. INCORPORATED CONSOLIDATED BALANCE SHEET December 31, 2001 ASSETS Current Assets: Cash and cash equivalents $ 2,443,693 Marketable securities (Note 2) 4,445,888 Management, distribution and other fees receivable 105,717 Dividends, interest and other receivables 24,246 Prepaid expenses and other current assets 72,416 Refundable income taxes 259,420 ------------ Total Current Assets 7,351,380 ------------ Equipment, furniture and fixtures, net 51,232 Excess of cost over net book value of subsidiaries, net 197,440 Deferred income taxes (Note 8) 91,000 Other assets (Note 10) 345,733 ------------ 685,405 ------------ Total Assets $ 8,036,785 ============ LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities: Accounts payable $ 27,871 Accrued professional fees 102,213 Accrued payroll and other related costs 46,197 Accrued other expenses 45,140 Other current liabilities 66,518 ------------ Total Current Liabilities 287,939 ------------ Contingencies (Note 12) - Shareholders' Equity (Notes 2, 4, 5, and 6) Common Stock, $.01 par value Class A, 10,000,000 shares authorized; 1,628,320 shares issued and outstanding 16,283 Class B, 20,000 shares authorized; 20,000 shares issued and outstanding 200 Additional paid-in capital 6,807,985 Retained earnings 1,512,552 Notes receivable for common stock issued (597,736) Accumulated other comprehensive income 9,562 ------------ Total Shareholders' Equity 7,748,846 ------------ Total Liabilities and Shareholders' Equity $ 8,036,785 ============ See accompanying notes to consolidated financial statements. -11- WINMILL & CO. INCORPORATED CONSOLIDATED STATEMENTS OF INCOME Years Ended December 31, 2001 2000 ---- ---- Revenues: Management, distribution and other fees $ 1,759,262 $ 2,285,540 Real estate rental income - 250,941 Gain on sale of real estate - 901,046 Consulting fee 246,923 200,000 Realized and unrealized gains (losses) from investments (360,418) 225,149 Dividends, interest and other 264,639 301,129 ------------- ------------ 1,910,406 4,163,805 ------------- ------------ Expenses: General and administrative 916,751 1,290,311 Marketing 718,984 949,909 Expense reimbursements to the Funds (Note 11) 284,375 287,555 Professional fees 181,324 192,835 Amortization and depreciation 93,890 126,755 Non-recurring item (Note 9) - 325,000 ------------- ------------ 2,195,324 3,172,365 ------------- ------------ Income (loss) before income taxes (284,918) 991,440 Income taxes (benefit) (Note 8) (85,853) 483,126 ------------- ------------ Net Income (Loss) $ (199,065) $ 508,314 ============= ============ Per Share Data: Basic Net income (loss) $ (.12) $.31 ======= ==== Diluted Net income (loss) $ (.12) $.31 ======= ==== Average Shares Outstanding: Basic 1,653,343 1,655,017 ========= ========= Diluted 1,653,343 1,659,839 ========= ========= See accompanying notes to consolidated financial statements. -12- WINMILL & CO. INCORPORATED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY Years Ended December 31, 2001 and 2000
Number of Shares Amount Notes Receivable For Accumulated Additional Common Retained Other Total Class A Class B Class A Class B Paid-In Stock Earnings Comprehensive Shareholders' Common Common Common Common Capital Issued (Deficit) Income Equity ------ ------ ------ ------ ---------- --------- ---------- --------- ---------- Balance, December 31, 1999 1,635,017 20,000 $16,351 $200 $6,872,454 $(603,675) $1,203,303 $ 350,002 $7,838,635 ---------- Net income - - - - - - 508,314 - - 508,314 Other comprehensive income Unrealized losses on investments - - - - - - - (385,203) (385,203) --------- ------- ------- ---- ---------- --------- ---------- --------- ---------- Comprehensive income 123,111 ---------- Balance, December 31, 2000 1,635,017 20,000 16,351 200 6,872,454 (603,675) 1,711,617 (35,201) 7,961,746 Net loss - - - - - - (199,065) - (199,065) Other comprehensive income Unrealized gains on marketable securities - - - - - - - 44,763 44,763 --------- ------- ------- ---- ---------- --------- ---------- --------- ---------- Comprehensive income (154,302) ---------- Redemption of stock (6,697) - (68) - (64,469) - - - (64,537) Repayment of notes receivable - - - - - 5,939 - - 5,939 --------- ------- ------- ---- ---------- --------- ---------- --------- ---------- Balance, December 31, 2001 1,628,320 20,000 $16,283 $200 $6,807,985 $(597,736) $1,512,552 $ 9,562 $7,748,846 ========= ======= ======= ==== ========== ========= ========== ========= ==========
See accompanying notes to consolidated financial statements. -13- WINMILL & CO. INCORPORATED CONSOLIDATED STATEMENTS OF CASH FLOWS Years Ended December 31,
2001 2000 ---- ---- Cash Flows from Operating Activities: Net income (loss) $ (199,065) $ 508,314 ------------- ------------- Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation and amortization 93,890 126,755 Write-off of impaired asset - 325,000 Deferred income taxes 47,000 26,000 Decrease (increase) in cash value of life insurance 21,463 (88,500) Realized/unrealized (gain) loss on investments 360,418 (225,149) Gain on sale of real estate - (901,046) (Increase) decrease in: Management, distribution and other fees receivable 56,057 111,026 Dividends, interest and other receivables 159,570 (140,387) Prepaid expenses and other current assets 118,094 (61,548) Refundable income taxes (259,420) - Other assets (13,275) - Increase (decrease) in: Accounts payable (10,778) (163,277) Accrued expenses 57,557 (37,041) Accrued income taxes (231,000) (1,635,600) Other current liabilities 56,682 - ------------- ------------- Total adjustments 456,258 (2,663,767) ------------- ------------- Net cash provided by (used for) operating activities 257,193 (2,155,453) ------------- -------------
-14- WINMILL & CO. INCORPORATED CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued) Years Ended December 31,
2001 2000 ---- ---- Cash Flows from Investing Activities: Improvement to real estate $ - $ (53,951) Proceeds from sale of real estate - 2,250,000 Capital expenditures (5,623) (5,301) Proceeds from sales of investments 838,781 2,797,044 Purchases of investments (1,674,147) (2,306,345) ------------- ------------- Net cash provided by (used in) investing activities (840,989) 2,681,447 ------------- ------------- Cash Flows from Financing Activities: Repayments of notes receivable 5,939 - Redemption of Class A Common Stock (64,537) - ------------- ------------- Net cash provided by (used in) financing activities (58,598) - ------------- ------------- Net increase (decrease) in cash and cash equivalents (642,394) 525,994 Cash and cash equivalents: Beginning of year 3,086,087 2,560,093 ------------- ------------- End of year $ 2,443,693 $ 3,086,087 ============= =============
SUPPLEMENTAL DISCLOSURE: The Company paid $0 and $1,475,000 in Federal income taxes in 2001 and 2000, respectively. See accompanying notes to consolidated financial statements. -15- WINMILL & CO. INCORPORATED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2001 and 2000 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES NATURE OF BUSINESS Winmill & Co. Incorporated ("Company") is a holding company. Its subsidiaries' business consists of providing investment management and distribution services for the Midas Funds (three open-end funds), Global Income Fund, Inc., a closed-end fund, and proprietary securities trading. BASIS OF PRESENTATION The consolidated financial statements include the accounts of the Company and all of its subsidiaries. Substantially all intercompany accounts and transactions have been eliminated. ACCOUNTING ESTIMATES In preparing financial statements in conformity with accounting principles generally accepted in the United States of America, management makes estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reported period. Actual results could differ from those estimates. FAIR VALUE OF FINANCIAL INSTRUMENTS The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses and other liabilities approximate fair value because of the short maturity of these items. Marketable securities are recorded at market value which represents the fair value of the securities. CASH AND CASH EQUIVALENTS Investments in money market funds are considered to be cash equivalents. At December 31, 2001, the Company and subsidiaries had invested approximately $2,212,500 in an affiliated money market fund. MARKETABLE SECURITIES The Company and its non-broker/dealer subsidiaries' marketable securities are considered to be "available-for-sale" and recorded at market value, with the unrealized gain or loss included in stockholders' equity as "accumulated other comprehensive income." Marketable securities for the broker/dealer subsidiary is valued at market with unrealized gains and losses included in earnings. -16- WINMILL & CO. INCORPORATED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) December 31, 2001 and 2000 INCOME TAXES The Company's method of accounting for income taxes conforms to Statement of Financial Accounting Standards No. 109 "Accounting for Income Taxes." This method requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting basis and the tax basis of assets and liabilities. The Company and its wholly-owned subsidiaries file consolidated income tax returns. EQUIPMENT Equipment, furniture and fixtures are recorded at cost and are depreciated on the straight-line basis over their estimated useful lives, 3 to 10 years. At December 31, 2001 and 2000, accumulated depreciation on equipment, furniture and fixtures amounted to approximately $812,100. EXCESS OF COST OVER NET BOOK VALUE OF SUBSIDIARIES, NET The excess of cost over net book value of subsidiaries is capitalized and amortized over fifteen years using the straight-line method. At December 31, 2001, accumulated amortization amounted to approximately $136,700. Periodically, the Company reviews its intangible assets for events or changes in circumstances that may indicate that the value of its intangible assets is not recoverable (See Note 9). Effective in 2002, the Company will apply Statement of Financial Accounting Standards No. 142 "Goodwill and Other Intangible Assets" ("SFAS 142") and reassess the useful life of the previously recognized intangible assets and adjust the remaining amortization periods accordingly. The adoption of SFAS 142 is not expected to have a material effect on the financial statements of the Company. COMPREHENSIVE INCOME The Company discloses comprehensive income in the financial statements. Total comprehensive income includes net income and unrealized gains and losses on marketable securities, which is reported as other comprehensive income in stockholders' equity. SEGMENT INFORMATION The Company's operating segment is organized around services provided and classified into one group - investment management. As a result of the sale of the real estate held for investment in 2000, the Company is no longer operating in real estate services. EARNINGS PER SHARE Basic earnings per share is computed using the weighted average number of shares outstanding. Diluted earnings per share is computed using the weighted average number of shares outstanding adjusted for the incremental shares attributed to outstanding options to purchase common stock. -17- WINMILL & CO. INCORPORATED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) December 31, 2001 and 2000 The following table sets forth the computation of basic and diluted earnings per share: 2001 2000 ---- ---- Numerator for basic and diluted earnings per share: Net income (loss) $ (199,065) $ 508,314 =========== =========== Denominator: Denominator for basic earnings per share - weighted-average shares 1,653,343 1,655,017 Effect of dilutive securities: Employee Stock Options - 4,822 ----------- ----------- Denominator for diluted earnings per share - adjusted weighted - average shares and assumed conversions 1,653,343 1,659,839 =========== =========== 2. MARKETABLE SECURITIES At December 31, 2001 marketable securities consisted of: Broker/dealer securities - at market Affiliated investment companies $ 3,658,794 Equity securities 752,596 ------------ Total broker/dealer securities (cost - $3,984,299) 4,411,390 ------------ Other companies Unaffiliated investment companies 3,325 Equity securities 31,173 ------------ Total available-for-sale securities (cost - $17,936) 34,498 ------------ $ 4,445,888 At December 31, 2001, the Company had $9,562, net of deferred income taxes, of unrealized gains on "available-for-sale securities" which is reported as a separate component of consolidated shareholders' equity. Included in the investments in affiliated investment companies are investments of $2,005,428 or approximately 23% of the outstanding shares of Bexil and $1,643,799 or approximately 19% of the outstanding shares of Tuxis, both of which have received shareholder approval to change from regulated investment companies to operating companies. -18- WINMILL & CO. INCORPORATED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) December 31, 2001 and 2000 3. LEASE COMMITMENTS The Company leases office space under a lease which expires December 31, 2003. The rent is approximately $109,000 per annum including electricity. 4. SHAREHOLDERS' EQUITY The Class A and Class B Common Stock are identical in all respects except for voting rights, which are vested solely in the Class B Common Stock. The Company also has 1,000,000 shares of Preferred Stock, $.01 par value, authorized. As of December 31, 2001 and 2000, none of the Preferred Stock was issued. 5. NET CAPITAL REQUIREMENTS The Company's broker/dealer subsidiary is a member firm of the National Association of Securities Dealers, Inc. ("NASD") and is registered with the Securities and Exchange Commission as a broker/dealer. Under its membership agreement with the NASD, the broker/dealer must maintain minimum net capital, as defined, of not less than $100,000, or 6-2/3% of aggregate indebtedness, whichever is greater; and a ratio of aggregate indebtedness to net capital, as defined, of not more than 15 to 1. At December 31, 2001, the subsidiary had net capital of approximately $4,560,200; net capital requirements of $100,000; excess net capital of approximately $4,460,200; and the ratio of aggregate indebtedness to net capital was approximately 0.03 to 1. 6. STOCK OPTIONS On December 6, 1995, the Company adopted a Long-Term Incentive Plan which, as amended, provides for the granting of a maximum of 600,000 options to purchase Class A Common Stock to directors, officers and key employees of the Company or its subsidiaries. With respect to non-employee directors, only grants of non-qualified stock options and awards of restricted shares are available. The three non-employee directors were granted 15,000 options each on December 12, 2000 and all previously issued options were cancelled. The option price per share may not be less than the fair value of such shares on the date the option is granted, and the maximum term of an option may not exceed ten years except as to non-employee directors for which the maximum term is five years. -19- WINMILL & CO. INCORPORATED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) December 31, 2001 and 2000 The Company applies APB Opinion 25 and related interpretations in accounting for its stock option plans. Accordingly, no compensation cost has been recognized for its stock option plans. Pro forma compensation cost for the Company's plans is required by Financial Accounting Standards No. 123 "Accounting for Stock-Based Compensation (SFAS 123)" and has been determined based on the fair value at the grant dates for awards under these plans consistent with the method of SFAS 123. For purposes of pro forma disclosure, the estimated fair value of the options is amortized to expense over the options' vesting period. The Company's pro forma information follows: Years Ended December 31, 2001 2000 ---- ---- Net income (loss) As reported $(199,065) $502,572 Pro forma $(213,005) $463,593 Earnings per share Basic As reported $(.12) $.30 Pro forma $(.13) $.28 Diluted As reported $(.12) $.30 Pro forma $(.13) $.28 The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted average assumptions used for grants in 2001 and 2000: expected volatility of 46.98% and 46.33%, risk-free interest rate of 3.95% and 4.40% and expected life of three years for each year. A summary of the status of the Company's stock option plans as of December 31, 2001 and 2000, and changes during the years ending on those dates is presented below: Weighted Number Average Of Exercise Stock Options Shares Price Outstanding at December 31, 1999 239,000 $2.32 Granted 261,000 $1.65 Canceled (274,000) $2.26 ---------- Outstanding at December 31, 2000 226,000 $1.61 Granted 15,000 $1.80 Canceled (20,000) $1.94 ---------- Outstanding at December 31, 2001 221,000 $1.60 ========== There were 174,000 and 182,000 options exercisable at December 31, 2001 and 2000 with a weighted-average exercise price of $1.59 and $1.64, respectively. The weighted-average fair value of options granted using the Black Scholes option-pricing model was $.64 and $.54 for the years ended December 31, 2001 and 2000, respectively. -20- WINMILL & CO. INCORPORATED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) December 31, 2001 and 2000 In December 2000, the Company canceled 192,000 previously issued stock options. The exercise prices of the canceled stock options were $1.875 to $2.6125. In December 2000, the Company granted 216,000 stock options with exercise prices of $1.50 to $1.65. The following table summarizes information about stock options outstanding at December 31, 2001: Weighted-Average Range of Number Remaining Weighted-Average Exercise Prices Outstanding Contractual Life Exercise Price $1.50 - $1.65 206,000 4.0 years $1.58 $1.70 - $1.80 15,000 4.5 years $1.80 In connection with the exercise of the options, the Company has received from certain officers notes with interest rates ranging from 2.45% to 2.48% per annum payable December 31, 2004. The balance of the notes, including interest, at December 31, 2001 was $597,736, which was classified as "notes receivable for common stock issued." 7. PENSION PLAN The Company has a 401(k) retirement plan for substantially all of its qualified employees. Contributions are based upon a percentage of earnings of eligible employees and are accrued and funded on a current basis. Total pension expense for the years ended December 31, 2001 and 2000 was approximately $33,700 and $45,100, respectively. 8. INCOME TAXES The provision for income tax expense (benefit) was as follows: 2001 2000 ---- ---- Current Federal $ (114,000) $ 352,000 State and local (18,853) 105,126 ----------- ---------- (132,853) 457,126 Deferred 47,000 26,000 ----------- ---------- $ (85,853) $ 483,126 =========== ========== -21- WINMILL & CO. INCORPORATED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) December 31, 2001 and 2000 Deferred tax assets are comprised of the following at December 31, 2001 and 2000: 2001 2000 ---- ---- Unrealized depreciation on investments $ 53,000 $ 138,000 Accrued expenses 19,000 - Net operating loss carryforwards 19,000 - --------- ---------- Net deferred tax assets $ 91,000 $ 138,000 ========= ========== A reconciliation of the federal statutory income tax rate to the Company's effective tax rate is as follows: 2001 2000 ---- ---- Statutory rate 34.0% 34.0% Increase in effective tax rate resulting from: State income taxes, net of federal benefit 4.4 7.0 Write-down of non-deductible intangible assets (6.2) 11.1 Non-deductible income and expenses - net (2.1) (3.4) ------ ----- 30.1% 48.7% ====== ===== 9. NON-RECURRING ITEM In 2000, the Company determined that the carrying value of one of its excess of cost over net book value of subsidiaries exceeded its net realizable value. This occurred because of a decline in net assets under management. As a result, the Company recorded a non-recurring charge to operations of $325,000. 10. RELATED PARTIES All management and distribution fees are a result of services provided to the Funds. All such services are provided pursuant to agreements that set forth the fees to be charged for these services. These agreements are subject to annual review and approval by each Fund's Board of Directors and a majority of the Fund's non-interested directors. In addition, during the years ended December 31, 2001 and 2000, the Funds paid approximately $69,000 and $147,000, respectively, for recordkeeping services to ISC, which paid such amounts to certain brokers for performing such services. These reimbursements for recordkeeping services were recorded in management, distribution and other fees. In connection with investment management services, the Company's investment management and distributor subsidiaries waived management and distribution fees from the Funds in the amount of approximately $284,400 and $287,600 for the years ended December 31, 2001 and 2000, respectively. -22- WINMILL & CO. INCORPORATED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) December 31, 2001 and 2000 On March 31, 1999, the Company sold its discount brokerage business, Bull & Bear Securities, ("BBSI") to a subsidiary of Royal Bank of Canada. In connection with the sale, Royal Bank agreed that it would cause for the three-year period following the sale, BBSI to offer exclusively Dollar Reserves to its customers as the sole money market fund into which cash balances held by BBSI's customers may be swept on a daily basis. In addition, the Company agreed to provide to BBSI for a period of three years following the sale certain services with respect to the operation of a securities brokerage business for a monthly consulting fee of $16,666.67, subject to certain conditions. The agreement was terminated in June 2001 by Royal Bank which provided a final settlement payment of approximately $164,000. Certain officers of the Company also serve as officers and/or directors of the Funds. Commencing August 1992, the Company has a key man life insurance policy on the life of the Company's Chairman which provides for the payment of $1,000,000 to the Company upon his death. As of December 31, 2001, the policy had a cash surrender value of approximately $242,000 and is included in other assets in the balance sheet. 11. FINANCIAL INFORMATION BY BUSINESS SEGMENT As the result of the sale of the real estate held for investment in December 2000, the Company no longer operates in real estate services. The following details selected financial information by business segment for the year ended December 31, 2000. Investment Real Estate Management Operations Total 2000 Revenues $2,485,540 $ 250,941 $2,736,481 Gain on sale of real estate - 901,046 901,046 Investment income 525,121 1,157 526,278 Income from operations 157,800 833,640 991,440 Depreciation and amortization 62,506 64,249 126,755 Non-recurring item 325,000 - 325,000 Capital expenditures 5,301 53,951 59,252 Gross identifiable assets 6,345,189 2,133,033 8,478,222 -23- WINMILL & CO. INCORPORATED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) December 31, 2001 and 2000 12. CONTINGENCIES From time to time, the Company and/or its subsidiaries are threatened or named as defendants in litigation arising in the normal course of business. As of December 31, 2000, neither the Company nor any of its subsidiaries was involved in any other litigation that, in the opinion of management, would have a material adverse impact on the consolidated financial statements. In July 1994, the Company entered into a Death Benefit Agreement ("Agreement") with the Company's Chairman. Following his death, the Agreement provides for annual payments, equal to 80% of his average annual salary for the three year period prior to his death subject to certain adjustments, to his wife until her death. The Company's obligations under the Agreement are not secured and will terminate if he leaves the Company's employ under certain conditions. -24- PART III Item 8. Directors and Executive Officers The following list contains the names, ages, positions and lengths of service of all directors and executive officers of the Company.
Name Position Years of Service Age Director Officer Bassett S. Winmill Chairman of the Board 25 25 71 Robert D. Anderson Vice Chairman of the Board 25 25 72 Thomas B. Winmill, Esq. President, 13 14 42 General Counsel, Director Edward G. Webb, Jr. Director 16* 13** 62 Charles A. Carroll Director 10 - 71 Mark C. Winmill Director 12*** 14**** 44 Marion E. Morris Senior Vice President - 1 56 William G. Vohrer Treasurer, - 1 51 Chief Accounting Officer Monica Pelaez, Esquire Vice President, Secretary, Associate General Counsel - 2 30
* 1985 to 1990 and 1992 to present. ** 1979 to 1990 *** 1989 to 1999 and 2000 to present. **** 1987 to 1999 -25- Set forth below is a description of the business experience of the directors and executive officers of the Company during the past five years. BASSETT S. WINMILL - Chairman of the Board of Directors. He is also Chairman of certain investment companies managed by Company subsidiaries and Chief Executive Officer of Tuxis Corporation. He is a member of the New York Society of Security Analysts, the Association for Investment Management and Research, and the International Society of Financial Analysts. He is the father of Thomas B. Winmill and Mark C. Winmill. ROBERT D. ANDERSON - Vice Chairman of the Board of Directors. He is also Vice Chairman of certain investment companies managed by Company subsidiaries and of the subsidiaries of the Company. THOMAS B. WINMILL, ESQ. - President, General Counsel, Chief Executive Officer and Director. He is also President of the investment companies managed by Company subsidiaries and of certain other subsidiaries of the Company. He is also President of Bexil Corporation. He is a member of the New York State Bar. He is a son of Bassett S. Winmill and brother of Mark C. Winmill. EDWARD G. WEBB, JR. - Director. He has been President of Webb Associates, Ltd. since 1996. From 1990 to 1996, he was Investment Director for Home Insurance Company, an affiliate of Trygg -House A1. Prior to that, he served as a Senior Vice President and Director of the Company. CHARLES A. CARROLL - Director. From 1989 to the present, he has been affiliated with Kalin Associates, Inc., a member firm of the New York Stock Exchange. MARK C. WINMILL - Director. He is currently Chairman of the Thanksgiving Foundation. He was Co-President and Director of the Company from June 1990 to March 1999 and an Officer and Director of its various Funds and subsidiaries from June 1987 to March 1999. He was President and Director of Bull & Bear Securities, Inc. ("BBSI"), a nationwide discount broker, from June 1987 until March 1999 when the Company sold BBSI to The Royal Bank of Canada. He was also Chief Operating Officer of BBSI from April 1999 to February 2000. He is a son of Bassett S. Winmill and a brother of Thomas B. Winmill. WILLIAM G. VOHRER - Chief Financial Officer, Treasurer and Chief Accounting Officer. He joined the company in February 2001. He is also Chief Financial Officer and Treasurer of Bexil Corporation. From 1999 to 2001, he consulted on accounting matters. From 1994 to 1999 he was Chief Financial Officer and Financial Operations Principal for Nafinsa Securities, Inc., a Mexican Securities broker/dealer. From 1978 to 1994, he held Chief Financial Officer/Controller positions with various international banks. MARION E. MORRIS - Senior Vice President. Since November 2000, she has served as Senior Vice President of the Company, CEF, and certain investment companies managed by the Company. She is Director of Fixed Income and a member of the Investment Policy Committee of CEF. Since 1997, she acted as general manager of Michael Trapp. Previously, she had served as Vice President of Salomon Brothers, The First Boston Corporation and Cantor Fitzgerald. MONICA PELAEZ, ESQ. - Vice President, Secretary and Chief Compliance Officer. She is also Vice President, Secretary and Chief Compliance Officer of the investment companies managed by the Company, and the Investment Manager and certain of its affiliates. Previously, she was Special Assistant Corporation Counsel to New York City Administration for Children's Services from 1998 to 2000 and an attorney with Debevoise & Plimpton from 1997 to 1998. She earned her Juris Doctor from St. John's University School of Law in 1997. She is a member of the New York State Bar. Each director is elected by the vote or written consent of the holder of a majority of the Class B Common Stock and holds office until the next meeting of the Class B common stockholder and until his successor is elected and qualified, or until his earlier death, resignation or removal. -26- Based solely on the information from Forms 3, 4, and 5 furnished to it, the Company believes that the directors, officers, and owners of more than 10 percent of the Class A Common Stock of the Company have filed on a timely basis reports required by Section 16(a) of the Securities Exchange Act of 1934 during the most recent fiscal year or prior fiscal years. Item 9. Executive Compensation The following information and tables set forth the information required under the Securities and Exchange Commission's executive compensation rules. Summary Compensation Table The following table sets forth, for the three years ended December 31, 2001, the compensation paid to the chief executive and other officers whose total annual salary and bonus exceeded $100,000 in 2001. SUMMARY COMPENSATION TABLE
Annual Long-Term Compensation Compensation ---------------------- Securities All Other Name And Salary Bonus Other Annual Underlying Compensation Principal Position Year ($) ($) Compensation* Options (a) (b) ---------------------- --------- -------- ------------ ------------- ---------- --- --- Bassett S. Winmill 2001 $315,000 $ 13,125 - 55,000 $ 3,584 $6,300 Chairman 2000 $315,000 $ 7,450 - 55,000 $ 3,504 $5,883 1999 $237,500 $ 215,625 - 80,000 $ 6,572 $5,000 Thomas B. Winmill 2001 $187,500(c) $ 10,416 - 55,000 $ 300 $6,300 President and 2000 $250,000 $ 10,416 - 55,000 $ 300 $6,000 Chief Executive Officer 1999 $187,500 $ 212,500 - 80,000 $ 255 $5,000 Marion E. Morris 2001 $105,000 $ 4,375 - 8,000 $ 555 $3,413 Senior Vice President 2000 $ 13,047 $ - - 8,000 $ 20 $ - 1999 - $ - - - $ - $ -
* Information omitted as perquisites do not exceed the lesser of $50,000 or 10% of the total annual salary and bonus for the year for the named executive officers. (a) Represents term life insurance (b) Represents Company's matching contributions to 401(k) Plan. (c) Mr. Winmill also received $62,500 in compensation from Bexil Corporation for his services as President. Option Grants Table No options were granted during the year ended December 31, 2001 to the named executive officers. -27- Aggregated Option Exercises and Fiscal Year-End Option Value Table The following table sets forth, for the year ended December 31, 2001, information regarding the outstanding options for each of the executive officers named in the Summary Compensation Table. Number of Shares of Class A Stock Value of Number of Underlying Unexercised Shares of Unexercised In-The-Money Class A Options at Options at tock Dollar 12-31-01 (#) 12-31-01 ($) Acquired on Value Exercisable/ Exercisable/ Name Exercise Realized Unexercisable Unexercisable Bassett S. Winmill 0 $0 55,000 / 0 $0 / $0 Thomas B. Winmill 0 $0 55,000 / 0 $0 / $0 Marion E. Morris 0 $0 0 / 8,000 $0 / $0 Long-Term Incentive Plan Awards Table There were no long-term incentive plan awards made during the year ended December 31, 2001 to the executive officers named in the Summary Compensation Table. Compensation of Directors Edward G. Webb, Jr., Charles A. Carroll and Mark C. Winmill were the only individuals who received compensation for their service as directors of the Company in 2001. They were each paid $500 per quarter as a retainer and $2,000 per quarterly meeting attended plus expenses. For the year ended December 31, 2001, Mr. Webb, Mr. Carroll and Mr. Mark C. Winmill were each paid $8,000 for attending three regular meetings and annual retainer and $500 for a telephone conference meeting. Employment Contracts The Company has no employment or termination contracts with any of its employees except to the extent of the agreement described in Note 12 to the financial statements. 1995 Long-Term Incentive Plan On December 6, 1995, the Board of Directors of the Company ("Board") and the Class B voting common stockholder adopted the Winmill & Co. Incorporated 1995 Long-Term Incentive Plan ("Plan"), as amended, under which a maximum of 600,000 options and stock-based awards (collectively, "Awards") may be made to directors, officers and employees of the Company or its subsidiaries. The amended Plan is described below. The purpose of the Plan is to assist the Company and its subsidiaries in attracting and retaining highly competent officers and directors and otherwise on behalf of the Company. The Plan also acts as an incentive in motivating selected officers and key employees to achieve long-term objectives of the Company, which will inure to the benefit of all stockholders of the Company. Any proceeds raised by the Company under the Plan will be used for working capital purposes. -28- General Provisions Duration of the Plan; Share Authorization. The Plan will terminate on December 6, 2005, unless terminated earlier by the Board. Six hundred thousand (600,000) shares of the Company's Class A Common Stock ("Shares") are available for Awards under the Plan. The Shares to be offered under the Plan are authorized and unissued Shares, or issued Shares that have been reacquired by the Company and held in its treasury. Holders of Shares do not have voting rights except as specifically provided by the Delaware General Corporation Law. Shares covered by any unexercised portions of terminated options, Shares forfeited by Participants, and Shares subject to any Awards that are otherwise surrendered by a Participant without receiving any payment or other benefit with respect thereto may again be subject to new Awards under the Plan. In the event the purchase price of an option or tax withholding relating to an Award is paid in whole or in part through the delivery of Shares, the number of Shares issuable in connection with the exercise of the option may not again be available for the grant of Awards under the Plan. Plan Administration. The Plan is administered by the Board or Compensation Committee ("Committee") of the Board. The Committee is composed of at least two directors of the Company, each of whom is a "Non-Employee Director" as defined in Rule 16b-3 promulgated by the SEC ("Rule 16b-3") under Section 16 of the Securities Exchange Act of 1934, as amended ("Exchange Act"). When the Committee is administering the Plan, the Committee will determine the officers and other key employees who will be eligible for and granted Awards, determine the amount and type of Awards, establish and modify administrative rules relating to the Plan, impose such conditions and restrictions on Awards as it determines appropriate and take such other action as may be necessary or advisable for the proper administration of the Plan. The Committee may, with respect to Participants who are not subject to Section 16 of the Exchange Act, delegate such of its powers and authority under the Plan as it deems appropriate to certain officers or employees of the Company. Plan Participants. Any employee of the Company or its subsidiaries, whether or not a director of the Company, may be selected by the Committee to receive an Award under the Plan. Non-Employee Directors shall receive such Awards (other than Incentive Stock Options) as the Board in its discretion may designate. Awards Available Under the Plan Awards to employees under the Plan may take the form of stock options or Restricted Share Awards. Awards under the Plan may be granted alone or in combination with other Awards. The consideration for issuance of Awards under the Plan is the continued services of the employees and non-employee directors to the Company and its subsidiaries. Stock Options Granted to Employees. Stock options ("Incentive Stock Options") meeting the requirements of Section 422 of the Internal Revenue Code of 1986, as amended from time to time, or any successor thereto ("Code"), and stock options that do not meet such requirements ("Non-Qualified Stock Options") are both available for grant to employees under the Plan. The term of each option will be determined by the Board or Committee, but no option will be exercisable more than ten years after the date of grant. If, however, an Incentive Stock Option is granted to a Participant who, at the time of grant of the option, owns (or is deemed to own under Section 424(d) of the Code) more than 10% (a "Ten Percent Shareholder") of the Company's Class B common stock, par value $0.01 per share ("Company Voting Securities"), the option is not exercisable more than five years after the date of grant. Options may also be subject to restrictions on exercise, such as exercise in periodic installments, performance targets and waiting periods, as determined by the Board or Committee. -29- The exercise price of each option is determined by the Board or Committee; however, the per share exercise price of an option must be at least equal to 100% of the Fair Market Value (as defined below) of a Share on the date of grant of such option. If, however, an Incentive Stock Option is granted to a Ten Percent Shareholder, the per share exercise price of the option must be at least equal to 110% of the Fair Market Value of a Share on the date of grant of such option. Fair Market Value of a Share means, as of any given date, the most recently reported sale price of a Share on such date as of the time when Fair Market Value is being determined on the principal national securities exchange on which the Shares are then traded or, if the Shares are not then traded on a national securities exchange, the most recently reported sale price of the Shares on such date as of the time when Fair Market Value is being determined on Nasdaq; provided, however, that, if there were no sales reported as of such date, Fair Market Value is the last sale price previously reported. In the event the Shares are not admitted to trade on a securities exchange or quoted on Nasdaq, the Fair Market Value of a Share as of any given date is as determined in good faith by the Board or Committee. Notwithstanding the foregoing, the Fair Market Value of a Share will never be less than par value per share. Subject to whatever installment exercise and waiting period provisions the Board or Committee may impose, options may be exercised in whole or in part at any time prior to expiration of the option by giving written notice of exercise to the Company specifying the number of Shares to be purchased. Such notice must be accompanied by payment in full of the purchase price in such form as the Board or Committee may accept (including payment in accordance with a cashless exercise program under which, if so instructed by the Participant, Shares may be issued directly to the Participant's broker or dealer upon receipt of the purchase price in cash from the broker or dealer). If and to the extent determined by the Board or Committee in its discretion at or after grant, payment in full or in part may also be made in the form of Shares duly owned by the Participant (and for which the Participant has good title, free and clear of any liens and encumbrances) or by reduction in the number of Shares issuable upon such exercise based, in each case, on the Fair Market Value of the Shares on the date the option is exercised. In the case of an Incentive Stock Option, however, the right to make payment of the purchase price in the form of Shares may be authorized only at the time of grant. Stock options granted under the Plan are not transferable except by will or the laws of descent and distribution and may be exercised, during the Participant's lifetime, only by the Participant. Unless the Board or Committee provides for a shorter period of time, upon a Participant's termination of employment other than by reason of death or disability, the Participant may, within three months from the date of such termination of employment, exercise all or any part of his or her options as were exercisable at the date of termination of employment but only if (x) the Participant resigns or retires and the Board or Committee consents to such resignation or retirement and (y) such termination of employment is not for cause. In no event, however, may any option be exercised after the time when it would otherwise expire. If such termination of employment is for cause or the Board or Committee does not so consent, the right of such Participant to exercise such options will terminate at the date of termination of employment. Further, unless the Board or Committee provides for a shorter period of time, upon a Participant's becoming disabled (such date being the "Disability Date"), the Participant may, within one year after the Disability Date, exercise all or a part of his or her options that were exercisable upon such Disability Date. In no event, however, may any option be exercised after the time when it would otherwise expire. Further, unless the Board or Committee provides for a shorter period of time, in the event of the death of a Participant while employed by the Company or prior to the expiration of the option as provided for in the event of disability, to the extent all or any part of the option was exercisable as of the date of death of the Participant, the right of the Participant's beneficiary to exercise the option will expire upon the expiration of one year from the date of the Participant's death (but in no event more than one year from the Participant's Disability Date) or on the stated termination date of the option, whichever is earlier. In the event of the Participant's death, the Board or Committee may, in its sole discretion, accelerate the right to exercise all or any part of an Option that would not otherwise be exercisable. -30- To the extent all or any part of an option was not exercisable as of the date of a Participant's termination of employment, such right will expire at the date of such termination of employment. Notwithstanding the foregoing, the Board or Committee, in its sole discretion and under such terms as it deems appropriate, may permit a Participant who will continue to render significant services to the Company after his or her termination of employment to continue to accrue service with respect to the right to exercise his or her options during the period in which the individual continues to render such services. Restricted Shares. The Board or Committee may award restricted Shares ("Restricted Shares") to a Participant. Such a grant gives a Participant the right to receive Shares subject to a risk of forfeiture based upon certain conditions. The forfeiture restrictions on the Restricted Shares may be based upon performance standards, length of service or other criteria as the Board or Committee may determine. Until all restrictions are satisfied, lapsed or waived, the Company will maintain control over the Restricted Shares but the Participant will be entitled to receive dividends on the Restricted Shares; provided, however, that any Shares distributed as a dividend or otherwise with respect to any Restricted Shares as to which the restrictions have not yet lapsed will be subject to the same restrictions as such Restricted Shares. When all restrictions have been satisfied and/or waived or have lapsed, the Company will deliver to the Participant or, in the case of the Participant's death, his or her beneficiary, stock certificates for the appropriate number of Shares, free of all restrictions (except those imposed by law). None of the Restricted Shares may be assigned or transferred (other than by will or the laws of descent and distribution), pledged or sold prior to lapse or release of the applicable restrictions. All of a Participant's Restricted Shares and rights thereto are forfeited to the Company unless the Participant continues in the service of the Company or any parent or subsidiary of the Company as an employee until the expiration of the forfeiture period, and all other applicable restrictions of the Restricted Shares. Notwithstanding the foregoing, the Board or Committee may, in its sole discretion, waive the forfeiture period and any other applicable restrictions on a Participant's Restricted Share Award, provided that the Participant must at that time have completed at least one year of employment after the date of grant. Awards Granted to Non-Employee Directors. Non-Employee Directors are eligible only to receive Non-Qualified Stock Options and Awards of Restricted Shares. All such grants may be made only by the Board. The terms and conditions applicable to grants of such Awards to Non-Employee Directors (except where specifically stated herein to the contrary) are the same as those applicable to grants of Non-Qualified Options and Restricted Shares to employees, except that references to (a) the Committee shall be deemed to refer to the Board (b) employees shall be deemed to refer to Non-Employee Directors and (c) termination of employment shall be deemed to refer to termination of service. Termination and Amendment The Board may amend or terminate the Plan at any time it is deemed necessary or appropriate; provided, however, that no amendment may be made, without the affirmative approval of the holder of Company Voting Securities, that would require stockholder approval under Rule 16b-3, the Code or other applicable law unless the Board determines that compliance with Rule 16b-3 and/or the Code is no longer desired. Except as provided by the Board or Committee, in its sole discretion, at the time of an Award or pursuant to certain antidilution provisions (as discussed below), no Award granted under the Plan to a Participant may be modified (unless such modification does not materially decrease the value of the Award) after the date of grant except by express written agreement between the Company and the Participant, provided that any such change (a) may not be inconsistent with the terms of the Plan, and (b) must be approved by the Board or Committee. -31- The Board has the right and the power to terminate the Plan at any time. No Award may be granted under the Plan after the termination of the Plan, but the termination of the Plan will not have any other effect and any Award outstanding at the time of the termination of the Plan may be exercised after termination of the Plan at any time prior to the expiration date of such Award to the same extent such Award would have been exercisable had the Plan not terminated. Antidilution Provisions Recapitalization. The number and kind of shares subject to outstanding Awards, the purchase price or exercise price of such Awards, and the number and kind of shares available for Awards subsequently granted under the Plan will be appropriately adjusted to reflect any stock dividend, stock split, combination or exchange of shares, merger, consolidation or other change in capitalization with a similar substantive effect upon the Plan or the Awards granted under the Plan. The Board or Committee has the power and sole discretion to determine the nature and amount of the adjustment to be made in each case. However, in no event will any adjustment be made in accordance with the Plan's antidilution provisions to any previous grant of Restricted Shares if an adjustment has been or will be made to the Shares awarded to a Participant in such person's capacity as a stockholder. Sale or Reorganization. After any reorganization, merger or consolidation in which the Company is the surviving entity, each Participant will, at no additional cost, be entitled upon the exercise of an Award outstanding prior to such event, and in connection with the payout after such event of any Award outstanding at the time of such event, to receive (subject to any required action by stockholders), in lieu of the number of Shares receivable or exercisable pursuant to such option, the number and class of shares of stock or other securities to which such Participant would have been entitled pursuant to the terms of the reorganization, merger or consolidation if, at the time of such reorganization, merger or consolidation, such Participant had been the holder of record of a number of Shares equal to the number of Shares receivable or exercisable pursuant to such Award. Comparable rights will accrue to each Participant in the event of successive reorganizations, mergers or consolidations of the character described above. Options to Purchase Stock of Acquired Companies. After any reorganization, merger or consolidation in which the Company is a surviving entity, the Board or Committee may grant substituted options under the provisions of the Plan, pursuant to Section 424 of the Code, replacing old options granted under a plan of another party to the reorganization, merger or consolidation whose stock subject to the old options may no longer be issued following such merger or consolidation. The foregoing adjustments and manner of application of the foregoing provisions will be determined by the Board or Committee in its sole discretion. Any such adjustments may provide for the elimination of any fractional Shares that might otherwise become subject to any options. Loans The Company is entitled, if the Board or Committee in its sole discretion deems it necessary or desirable, to lend money to a Participant for purposes of (a) exercising his or her rights under an Award hereunder or (b) paying any income tax liability related to an Award; provided, however, that Non-Employee Directors are not eligible to receive such loans and provided, further, that the portion of the per share exercise price of an option equal to the par value per Share may not be paid by means of a promissory note. Such a loan must be evidenced by a recourse promissory note payable to the order of the Company executed by the Participant and containing such other terms and conditions as the Board or Committee may deem desirable. The interest rate on such loans must be sufficient to avoid imputed interest under the Code. -32- Item 10. Security Ownership of Certain Beneficial Owners and Management. (a) Bassett S. Winmill, Chairman of the Board of Directors, owns all of the issued and outstanding shares of the Company's Class B Common Stock, which represents 100% of the Company's voting securities. (b) The following table sets forth, as of December 31, 2001, information relating to beneficial ownership by individual directors of the Company, executive officers named in the Summary Compensation Table and by directors and executive officers of the Company as a group, of the currently issued and outstanding Class A Common Stock of the Company. Amount and Nature of Percent Name of Beneficial Owner Beneficial Ownership (5) of Class ------------------------ ------------------------ -------- Bassett S. Winmill 331,104 (1) 19.7% Thomas B. Winmill 177,520 (2) 10.5% Robert D. Anderson 94,414 (3) 5.6% Edward G. Webb, Jr. 18,664 (4) 1.1% Charles A. Carroll 38,100 (4) 2.3% Mark C. Winmill 106,800 (4) 6.5% All directors and executive officers as a group (6 persons) 766,602 42.4% (1) Includes options exercisable to purchase 55,000 shares at December 31, 2001. (2) Includes 10,000 shares held by Thomas B. Winmill's sons, of which he disclaims beneficial ownership and options exercisable to purchase 55,000 shares. (3) Includes options exercisable to purchase 25,000 shares. (4) Includes options exercisable to purchase 15,000 shares. (5) The nature of the beneficial ownership for all the Class A Common Stock is investment power. Item 11. Certain Relationships and Related Transactions The following sets forth the reportable items regarding indebtedness of management in excess of $60,000. Largest Amount Amount Of Outstanding At Name and Relationship Indebtedness December 31, 2001 Bassett S. Winmill, Chairman * $290,758 $272,227 Thomas B. Winmill, President * $207,971 $199,075 Mark C. Winmill, Director * $219,709 $219,709 * In connection with the exercise of stock options and related tax expense, the Company received notes with interest rates ranging from 2.45% to 2.48% per annum payable on December 31, 2004. -33- PART IV Item 12. Exhibits, Consolidated Financial Statements and Schedules, and Reports on Form 8-K (a) (1) Financial Statements See Item 7 for a list of the financial statements filed as part of this report. (2) Financial Statement Schedules by Regulation S-X are not required under the related instructions or are inapplicable, and therefore have been omitted. (3) Exhibits (2) Not applicable (3) Certificate of Incorporation as amended October 24, 1989 as filed as an exhibit to Form 10-K for the year ended December 31, 1992 and incorporated herein by reference; Certificate of Incorporation as amended April 1, 1999 as filed as an exhibit to Form 10-K/A for the year ended December 31, 1998 and incorporated herein by reference; By-Laws amended as of October 1, 1993 as filed as an exhibit to Form 10-K for the year ended December 31, 1993 and incorporated herein by reference, and By-Laws amended as of April 1, 1999 as filed as an exhibit to Form 10-K/A for the year ended December 31, 1998 and incorporated herein by reference. (4) Instruments defining the rights of security holders, including indentures (see Article Four of Certificate of Incorporation). (9) Not applicable. (10) Material Contracts (a) Investment Management Agreements, Distribution Agreements and Plans of Distribution ("12b-1 Plans") between subsidiaries of the Company and the Funds and Non-Exclusive License Agreements between the Company and the Funds:
Non-Exclusive Management Distribution 12b-1 License Fund Agreement Agreement Plan Agreement (i) Dollar Reserves, Inc. (1) (1) (1) (3) (ii) Global Income Fund, Inc. (4) - - - (iii) Midas Special Equities Fund, Inc. (1) (1) (1) (3) (iv) Tuxis Corporation (4) - - (3) (v) Bexil Corporation (4) - - (3) (vi) Midas Fund, Inc. (2) (2) (2) (3)
(1) Filed as exhibits to Form 10-K for the year ended December 31, 1993 and incorporated herein by reference. (2) Filed as exhibits to Form 10-K for the year ended December 31, 1995 and incorporated herein by reference. -34- (3) Filed as exhibits to Form 10-K for the year ended December 31, 1997 and incorporated herein by reference. (4) Filed as exhibits to Form 10-K for the year ended December 31, 1999 and incorporated herein by reference. (b) Winmill & Co. Incorporated 1995 Long-Term Incentive Plan, as adopted December 6, 1995 and amended February 6, 1996, filed as exhibit to Form 10-K for the year ended December 31, 1995 and incorporated herein by reference. (c) Section 422A Incentive Stock Option Plan, as adopted December 5, 1990, filed as exhibit to Form 10-K for the year ended December 31, 1990 and incorporated herein by reference. (d) Investment Management Transfer Agreements between the investment management subsidiaries of the Company and filed as exhibit to Form 10-K for the year ended December 31, 1992 and incorporated herein by reference. (e) Winmill & Co. Incorporated Investment Plan, filed as an exhibit to Form 10-K for the year ended December 31, 1993 and incorporated herein by reference. (f) Death Benefit Agreement dated July 22, 1994 and filed as exhibit to Form 10-K for the year ended December 31, 1994 and incorporated herein by reference. (g) Winmill & Co. Incorporated Incentive Stock Option Agreement for Employees - Bassett S. Winmill filed as an exhibit to Form 10-K for the year ended December 31, 1995 and incorporated herein by reference. (h) Winmill & Co. Incorporated Incentive Stock Option Agreement for Employees - Robert D. Anderson filed as an exhibit to Form 10-K for the year ended December 31, 1995 and incorporated herein by reference. (i) Winmill & Co. Incorporated Incentive Stock Option Agreement for Employees - Mark C. Winmill filed as an exhibit to Form 10-K for the year ended December 31, 1995 and incorporated herein by reference. (j) Winmill & Co. Incorporated Incentive Stock Option Agreement for Employees - Thomas B. Winmill filed as an exhibit to Form 10-K for the year ended December 31, 1995 and incorporated herein by reference. (k) Winmill & Co. Incorporated Stock Option Agreement - Edward G. Webb, Jr. filed as an exhibit to Form 10-K for the year ended December 31, 1995 and incorporated herein by reference. -35- (l) Winmill & Co. Incorporated Stock Option Agreement - Charles A. Carroll filed as an exhibit to Form 10-K for the year ended December 31, 1995 and incorporated herein by reference. (m) Winmill & Co. Incorporated 1995 Long-Term Incentive Plan, (as Amended and Restated as of October 29, 1997), filed as exhibit to Form 10-K for the year ended December 31, 1997 and incorporated herein by reference. (n) Option Certificate for Bassett S. Winmill filed as an exhibit to Form 10-K for the year ended December 31, 1997 and incorporated herein by reference. (o) Option Certificate for Edward G. Webb, Jr. filed as an exhibit to Form 10-K for the year ended December 31, 1997 and incorporated herein by reference. (p) Option Certificate for Charles A. Carroll filed as an exhibit to Form 10-K for the year ended December 31, 1997 and incorporated herein by reference. (q) Option Certificate for Thomas B. Winmill filed as an exhibit to Form 10-K for the year ended December 31, 1997 and incorporated herein by reference. (r) Option Certificate for Robert D. Anderson filed as an exhibit to Form 10-K for the year ended December 31, 1997 and incorporated herein by reference. (s) Purchase Agreement, dated as of December 17, 1998, by and among Winmill & Co. Incorporated (formerly Bull & Bear Group, Inc.), Bull & Bear Securities, Inc. and RBC Holdings (USA) Inc., with all exhibits thereto filed as an exhibit to Form 8-K on December 18, 1998 and incorporated herein by reference. (11) Statement Regarding Computation of Per Share Earnings (12) Not applicable. (13) Not applicable. (16) Not applicable. (18) Not applicable. (21) Wholly-Owned Subsidiaries of the Company (23) Not applicable. (24) Not applicable. (27) Not applicable. (28) Not applicable. (99) Not applicable. (b) Reports on Form 8-K. No reports on Form 8-K were filed during the last quarter of the period covered by this report. -36- SIGNATURES Pursuant to the requirements of Section 13 of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. WINMILL & CO. INCORPORATED April 1, 2002 By:/s/ William G. Vohrer ---------------------------------- William G. Vohrer Chief Financial Officer, Treasurer, Chief Accounting Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Company and in the capacities and on the dates indicated. April 1, 2002 By:/s/ Bassett S. Winmill ------------------------------- Bassett S. Winmill, Chairman of the Board, Director April 1, 2002 By:/s/ Robert D. Anderson ------------------------------- Robert D. Anderson, Vice Chairman, Director April 1, 2002 By:/s/ Thomas B. Winmill, Esq. ------------------------------- Thomas B. Winmill, Esq., President Chief Executive Office, General Counsel, Director April 1, 2002 By:/s/ Edward G. Webb, Jr. ------------------------------- Edward G. Webb, Jr. Director April 1, 2002 By:/s/ Charles A. Carroll ------------------------------- Charles A. Carroll, Director April 1, 2002 By:/s/ Mark C. Winmill ------------------------------- Mark C. Winmill, Director -37- INDEX TO EXHIBITS (3) Exhibits (11) Statement Regarding Computation of Per Share Earnings (21) Wholly-Owned Subsidiaries of the Company -38- Exhibit 11 - Statement Regarding Computation of Per Share Earnings
2001 2000 -------------------------- ---------------------------- Basic Diluted Basic Diluted Weighted average common shares outstanding 1,653,343 1,653,343 1,655,017 1,655,017 Weighted average common shares issuable upon exercise of stock options under the treasury stock method - - - 4,822 Weighted average common shares issuable upon exercise of warrants under the treasury stock method - - - - Weighted average common shares and common share equivalents utilized for earnings per share computation 1,653,343 1,653,343 1,655,017 1,659,839
-39- Exhibit 21 - Wholly-Owned Subsidiaries of the Company CEF Advisers, Inc., a Delaware corporation Investor Service Center, Inc., a Delaware corporation Midas Management Corporation, a Delaware corporation Performance Properties, Inc., a Delaware corporation -40-