10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

x Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2005

Commission file number 1-5654

EXX INC

(Exact Name of Registrant as Specified in Its Charter)

Nevada	88-0325271
(State or Other Jurisdiction of Incorporation or Organization)	(IRS Employer Identification No.)
1350 East Flamingo Road, Suite 689, Las Vegas, Nevada	89119-5263
(Address or Principal Executive Offices)	(Zip Code)

(702) 598-3223

(Registrant’s Telephone Number, Including Area Code)

NONE

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

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 whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    NO  x

Number of shares of common stock outstanding as of August 5, 2005: 10,412,307 Class A Shares and 858,093 Class B Shares.

PART 1. FINANCIAL INFORMATION

ITEM 1.	EXX INC AND SUBSIDIARIES
	CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
	(In thousands, except share and per share amounts)

A. Consolidated Balance Sheets

	June 30, 2005			December 31, 2004
	(unaudited)
ASSETS
Current assets
Cash and cash equivalents	$	18,371		$	13,048
Accounts receivable, less allowances of $249 and $249		19,656			20,266
Inventories		10,822			13,041
Other current assets		1,509			1,555
Refundable income taxes		91			—
Deferred tax asset		1,451			1,451
Total current assets		51,900			49,361
Property and equipment, net		25,678			26,559
Other assets
Goodwill		9,134			9,977
Intangible assets, net		3,345			3,882
Other		741			1,193
		13,220			15,052
	$	90,798		$	90,972
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Long-term debt, current portion	$	1,576		$	2,322
Accounts payable and other current liabilities		18,059			17,520
Income taxes payable		—			359
Total current liabilities		19,635			20,201
Long-term liabilities
Long-term debt, less current portion		23,813			24,211
Post-retirement benefits, other than pension		3,312			3,345
Pension liability and other		6,688			6,919
Deferred tax liability		16,841			16,973
		50,654			51,448
Minority interest		133			121
Stockholders’ equity
Preferred stock, $.01 par value, authorized 5,000,000 shares, none issued
Common stock, Class A, $.01 par value, authorized 25,000,000 shares, issued 12,061,607 shares		121			121
Common stock, Class B, $.01 par value, authorized 1,000,000 shares, issued 874,693 shares		9			9
Capital in excess of par value		2,859			2,859
Accumulated other comprehensive loss		(269	)		(269	)
Retained earnings		18,642			17,468
Less treasury stock, 1,649,300 shares of Class A common stock and 16,600 shares of Class B common stock, at cost		(986	)		(986	)
Total stockholders’ equity		20,376			19,202
	$	90,798		$	90,972

See notes to consolidated condensed financial statements.

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B. EXX INC AND SUBSIDIARIES

    Consolidated Statements of Operations (Unaudited)

    (In thousands, except share and per share amounts)

	For the Three-Month Period Ended						For the Six-Month Period Ended
	June 30, 2005			June 30, 2004			June 30, 2005			June 30, 2004
Net sales	$	37,528		$	37,795		$	75,054		$	74,109
Cost of sales		32,379			31,661			65,420			62,518
Gross profit		5,149			6,134			9,634			11,591
Selling, general and administrative expenses		3,413			3,576			7,005			7,270
Operating income		1,736			2,558			2,629			4,321
Other income (expenses)
Interest expense		(323	)		(578	)		(774	)		(1,072	)
Interest income		43			6			73			14
Other income (loss)		(365	)		22			(76	)		37
Minority interest in income of consolidated subsidiary		(8	)		(8	)		(12	)		(17	)
		(653	)		(558	)		(789	)		(1,038	)
Income before income taxes		1,083			2,000			1,840			3,283
Income taxes		365			784			666			1,216
Net income	$	718		$	1,216		$	1,174		$	2,067
Net income per common share:
Basic	$	.06		$	.11		$	.10		$	.18
Assuming dilution	$	.06		$	.10		$	.10		$	.16
Weighted average shares outstanding:
Basic		11,270,400			11,270,400			11,270,400			11,270,400
Assuming dilution		12,229,109			12,486,399			12,245,841			12,653,959

See notes to consolidated condensed financial statements.

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C. EXX INC AND SUBSIDIARIES

    Consolidated Statements of Cash Flow (Unaudited)

    (In thousands)

	For the Six-Month Period Ended
	June 30, 2005			June 30, 2004
Cash flows from operating activities:
Net income	$	1,174		$	2,067
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Loss on disposal of assets		377			—
Depreciation and amortization		3,194			3,210
Deferred tax expense		711			705
Changes in operating assets and liabilities, net		2,965			(655	)
Net cash provided by operating activities:		8,421			5,327
Cash flows from investing activities:
Acquisition of property and equipment, net		(2,799	)		(152	)
Proceeds from sale of fixed assets		99			—
Net cash (used in) investing activities:		(2,700	)		(152	)
Cash flows from financing activities:
Net borrowed on revolving credit line		—			500
Repayment of term loan		(398	)		(3,911	)
Repayments on promissory notes/capital leases		—			(1,035	)
Net cash (used in) financing activities		(398	)		(4,446	)
Net increase in cash and cash equivalents		5,323			729
Cash and cash equivalents, beginning of period		13,048			12,056
Cash and cash equivalents, end of period	$	18,371		$	12,785
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest	$	765		$	1,033
Income taxes	$	100		$	1,075

See notes to consolidated condensed financial statements.

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D. EXX INC AND SUBSIDIARIES

    Notes to Consolidated Condensed Financial Statements

    (In thousands, except number of shares and per share amounts)

Note 1: Basis of Presentation

The unaudited consolidated condensed financial statements of EXX INC (“Company”) as of June 30, 2005 and for the three and six month periods ended June 30, 2005 and 2004 set forth in this Form 10-Q include the accounts of the Company and its consolidated subsidiaries and reflect all adjustments which are necessary in the opinion of management for a fair presentation of the results for the periods stated. All adjustments so made are of a normal recurring nature. The unaudited consolidated condensed financial statements do not include all information and footnotes necessary for a complete presentation in accordance with accounting principles generally accepted in the United States of America. The reader is referred to the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2004. Results for the three and six months ended June 30, 2005 are not necessarily indicative of the results to be expected for the full year ended December 31, 2005.

On March 28, 2005, the Company determined that an intangible asset representing “customer relationships” existed at the date of purchase of Newcor. As a result of the determination the Company recognized a charge to operations in the amount of approximately $400 net of tax for the year ended December 31, 2003 and approximately $448 net of tax for the year ended December 31, 2004. The effect of this charge for the three months and six months ended June 30, 2004 was $112 and $224 net of tax, respectively, which was retroactively reflected in the financial statements included in this report.

Note 2: Inventories

Inventories are summarized as follows:

	June 30, 2005 (unaudited)		December 31, 2004
Raw materials	$	7,521	$	6,973
Work in process		675		2,628
Finished goods		2,626		3,440
	$	10,822	$	13,041

Note 3: Long-Term Debt

A summary of debt follows:

	June 30, 2005 (unaudited)		December 31, 2004
Revolving credit line at 2% over Libor, currently 5.30% (a)	$	—	$	—
Promissory notes secured by certain equipment, various fixed rates of 7% - 8.5%		2,624		3,022
Notes payable, at 4% through 2015 collateralized by substantially all of the assets of a subsidiary (b)		394		394
Notes payable, at 4% through 2023 collateralized by substantially all of the assets of a subsidiary (b)		371		371
Capital lease obligations of a subsidiary (b)		—		746
Unsecured Notes payable of a subsidiary, currently 6% due 2013		22,000		22,000
Subtotal		25,389		26,533
Less current portion		1,576		2,322
Total	$	23,813	$	24,211

(a) On February 20, 2004, Newcor entered into a new bank credit facility with National City Bank (the “2004 Credit Agreement”). The 2004 Credit Agreement provided for $6,000 of available borrowings with reducing availability based upon a three year equal monthly amortization schedule, secured by the machinery and equipment owned by Newcor and its subsidiaries, except the machinery and equipment securing the $2,825 of equipment notes. As of December 31, 2004 there was $4,400 of available borrowings net of a $700 outstanding letter of credit under the 2004 Credit Agreement, none of which was outstanding as of December 31, 2004. In March 2005, the available borrowings under the 2004 Credit Agreement were reduced to $2,800. At June 30, 2005, $2,100 was available net of a $700 outstanding letter of credit, none of which was outstanding.

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(b) These notes are in default and, accordingly, have been classified as currently due. The capital lease was terminated retroactive to December 31, 2004 and was written off as part of a new lease agreement signed on April 7, 2005. See Note 7.

Note 4: Earnings Per Share

The difference between the number of shares used to compute basic net income per share and diluted net income per share relates to additional shares to be issued upon the assumed exercise of stock options, net of shares hypothetically repurchased at the average price with the proceeds of exercise. For the three months ended June 30, 2005 and June 30, 2004, these shares amounted to 958,709 shares and 1,215,999 shares respectively. For the six months ended June 30, 2005 and 2004, these shares amounted to 975,441 shares and 1,383,559 shares respectively

Note 5: Pension Plan Information

The Company is required to report the following information on an interim basis under FASB 132 with regard to its pension plans:

COMPONENTS OF NET PERIODIC BENEFIT COST

	Three Months Ended						Six Months Ended
	June 30, 2005			June 30, 2004			June 30, 2005			June 30, 2004
Service Costs	$	62		$	98		$	62		$	195
Interest Costs		617			615			1,234			1,232
Expected Returns on Plan Assets		(766	)		(752	)		(1,531	)		(1,502	)
Amortization of Unrecognized Losses		10			6			18			13
Net Periodic Pension Income	$	(77	)	$	(33	)	$	(217	)	$	(62	)

The Company previously disclosed in the financial statements for December 31, 2004 that it did not intend to make contributions to its plans in 2005.

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Note 6: Segment Reporting

The Company is organized into two business segments: the Mechanical Equipment segment and the Plastics and Rubber segment. The Mechanical Equipment segment produces transmission, power train and engine components and assemblies for the automotive, medium and heavy-duty truck, and agricultural vehicle industries, machine tools as well as electric motors and telecommunications equipment. The Plastics and Rubber segment produces cosmetic and functional seals and boots and functional engine compartment products primarily for the automotive industry and toys.

The accounting policies of the segments are the same as those of the Company. There are no intersegment sales and management does not allocate any corporate expenses to the segments. The Company evaluates the performance of its segments and allocates resources to them based on operating income from continuing operations. Information by operating segment is summarized below:

	Mechanical Equipment		Plastics & Rubber		Corporate			Total
Sales to unaffiliated customers three months ended June 30,
2005	$	32,604	$	4,924	$	—		$	37,528
2004	$	31,492	$	6,303	$	—		$	37,795
Operating income (loss) three months ended June 30,
2005	$	2,104	$	575	$	(943	)	$	1,736
2004	$	2,390	$	1,210	$	(1,042	)	$	2,558
Income (loss) before income taxes three months ended June 30,
2005	$	2,114	$	578	$	(1,609	)	$	1,083
2004	$	2,404	$	1,187	$	(1,591	)	$	2,000
Sales to unaffiliated customers six months ended June 30,
2005	$	65,626	$	9,428	$	—		$	75,054
2004	$	61,542	$	12,567	$	—		$	74,109
Operating income (loss) six months ended June 30,
2005	$	3,792	$	773	$	(1,936	)	$	2,629
2004	$	4,120	$	2,434	$	(2,233	)	$	4,321
Income (loss) before income taxes six months ended June 30,
2005	$	3,810	$	969	$	(2,939	)	$	1,840
2004	$	4,142	$	2,399	$	(3,258	)	$	3,283

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The following is a listing of revenue by major product group sold by the operating segments of the Company for the following periods.

	Three Months Ended				Six Months Ended
	June 30, 2005		June 30, 2004		June 30 2005		June 30 2004
Mechanical equipment
Machined production components	$	30,982	$	29,015	$	62,215	$	57,384
Electric motors and cable pressurization equipment		1,622		2,477		3,411		4,158
	$	32,604	$	31,492	$	65,626	$	61,542
Plastics and Rubber
Manufactured, molded plastic and rubber components	$	3,304	$	4,144	$	6,489	$	8,681
Impulse toys and other		1,620		2,159		2,939		3,886
	$	4,924	$	6,303	$	9,428	$	12,567

Note 7. Recent Developments

In 2004, EXX had announced that Newcor had been notified by its then largest customer, American Axle & Manufacturing, that Newcor would lose certain axle machining business due to American Axle’s strategic decision to in-source axle machining. This lost business is still anticipated by Newcor commencing with the withdrawal of two parts in the third quarter of 2005 with increasing volumes of parts being withdrawn through 2006. It is anticipated that when and as American Axle completes the insourcing program the lost business and profits from the American Axle & Manufacturing business will be exceeded by the total new revenues and profits from the three programs awarded by DaimlerChrysler (DCX) which will become Newcor’s largest customer. Management of the Company has performed an impairment analysis on the long-lived assets of the operations affected by the loss of revenues related to American Axle & Manufacturing, under the provisions of SFAS No. 144. Based on this analysis, management has determined that as of June 30, 2005 and December 31, 2004, there is no impairment on any of the long-lived assets as the discounted future cash flows of the subsidiary, directly affected by the loss of the American Axle business, exceeds the net book value of its assets at both these dates.

On May 9, 2005, EXX reported that one of the subsidiaries of Newcor received purchase orders DCX to machine axles for two current powertrain programs. The anticipated sales would approximate a 20% increase over EXX’s current sales and profitability on an annual basis. Production under the contracts began in the second quarter of 2005 and is expected to build up to full production levels in the fourth quarter of 2005.

On June 17, 2005, EXX reported that a second subsidiary of Newcor had been awarded a machining program for a DCX Powertrain. The annual sales of this program are estimated at approximately 10% of EXX’s 2004 annual sales. Full production under the program is planned to begin in the third quarter of 2005.

On April 7, 2005, an agreement to terminate the lease of the Handi-Pac Inc. subsidiary was signed retroactive to December 31, 2004. A new five month lease which expired on May 31, 2005 replaced the old lease. The first quarter of 2005, consolidated financial statements reflect the terms of the above agreements including writing off the capital lease and its related assets.

Note 8: Subsequent Events

On July 1, 2005 (the “Effective Date”), Newcor and Transinternational Widget Corp. (“TWC”), a Delaware corporation and wholly owned subsidiary of EXX, were merged under the provisions of the General Corporation Law of the State of Delaware (the “Merger”). Pursuant to the Merger, TWC merged with and into Newcor, with Newcor as the surviving corporation, and each issued and outstanding share of Newcor common stock was converted into the right to receive an amount in cash equal to $1,088, which amount represents the book value of said share of Newcor as of June 30, 2005. As the result of the Merger, EXX holds 100% of the issued and outstanding common stock of Newcor.

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ITEM 2. EXX INC AND SUBSIDIARIES

Management’s Discussion and Analysis of Financial Condition and Results of Operations

(In thousands, except for per share amounts)

This quarterly report on Form 10-Q contains certain forward-looking statements which are covered under the safe harbor provisions of the Private Securities Legislation Reform Act of 1995 with respect to the Company’s future financial performance. Although the Company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be realized. Forward-looking statements involve known and unknown risks which may cause the Company’s actual results and corporate developments to differ materially from those expected. Factors that could cause results and developments to differ materially from the Company’s expectations include, without limitation, changes in manufacturing and shipment schedules, delays in completing plant construction and acquisitions, new product and technology developments, competition within each business segment, cyclicality of the markets for the products of a major segment, litigation, significant cost variances, the effects of acquisitions and divestitures, and other risks.

Results of Operations

The Company is organized into two business segments, the Mechanical Equipment segment and the Plastics and Rubber segment. The Mechanical Equipment segment produces transmission, powertrain and engine components and assemblies for the automotive, medium and heavy-duty truck and agricultural vehicle industries as well as electric motors and telecommunications equipment. The Plastics and Rubber segment produces cosmetic and functional seals and boots and functional engine components primarily for the automotive industry and toys.

Sales for the second quarter of 2005 were $37,528 compared to $37,795 in 2004, a $267 decrease. Sales for the six month 2005 period were $75,054 compared to $74,109 for the six month 2004 period, a $945 increase. The Mechanical Equipment segment reported second quarter total sales of $32,604, which was an increase of $1,112 or 4% more than the prior year’s $31,492. The increase was due to deliveries of large specialty machine orders in the second quarter as well as an increase in sales of heavy duty truck components. Sales for the six month 2005 period totaled $65,626 compared to $61,542 for the six month 2004 period, an increase of $4,084 or 7%. The increase was due to deliveries of large special machine orders as well as an increase in sales of heavy duty truck components. The Plastics and Rubber segment second quarter sales were $4,924 in 2005 compared to $6,303 in 2004, a $1,379 decrease. The decrease in sales of 22% was due primarily to lower sales in the automotive market. Sales for the six month 2005 period totaled $9,428 compared to $12,567 in 2004, a $3,139 decrease or 25%. This decrease was due primarily to lower sales in the automotive market.

On May 9, 2005, EXX reported that one of the subsidiaries of Newcor received purchase orders from DaimlerChrysler Corporation (DCX) to machine axles for two current powertrain programs. The anticipated sales would approximate a 20% increase over EXX’s current sales and profitability on an annual basis. Production under the contracts began in the second quarter of 2005 and is expected to build up to full production levels in the fourth quarter of 2005.

On June 17, 2005, EXX reported that a second subsidiary of Newcor had been awarded a machining program for a DCX Powertrain. The annual sales of this program are estimated at approximately 10% of EXX’s 2004 annual sales. Full production under the program is planned to begin in the third quarter of 2005.

In 2004, EXX had announced that Newcor had been notified by its then largest customer, American Axle & Manufacturing, that Newcor would lose certain axle machining business due to American Axle’s strategic decision to in-source axle machining. This lost business is still anticipated by Newcor commencing with the withdrawal of two parts in the third quarter of 2005 with increasing volumes of parts being withdrawn through 2006. It is anticipated that when and as American Axle completes the insourcing program the lost business and profits from the American Axle business will be exceeded by the total new revenues and profits from the three programs awarded by DCX which will become Newcor’s largest customer.

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Gross profit for the second quarter of 2005 totaled $5,149 or 13.7% of sales compared to $6,134 or 16.2% of sales for the comparable period in 2004. For the six month period, 2005 gross profit was $9,634 compared to $11,591 in 2004. The Mechanical Equipment segment accounted for a gross profit of $3,859 in the second quarter of 2005 compared to $4,171 for the comparable second quarter in 2004 and a gross profit of $7,468 in the first six months of 2005 compared to $7,730 for the comparable six month period in 2004. Gross profit as a percentage of sales in the Mechanical Equipment segment decreased to 11.8% in 2005 from 13.2 % in 2004 for the comparable three month period and decreased from 12.6% in 2004 to 11.4% in 2005 for the comparable six month period in 2004. The Plastics and Rubber segment accounted for a gross profit of $1,290 in 2005 compared to $1,963 in 2004 for the three month period and accounted for a gross profit of $2,166 in 2005 compared to $3,861 in 2004 for the comparable six month period. Gross profit in 2005 as a percentage of sales in the Plastics and Rubber segment decreased to 26.2 % in the second quarter of 2005 from 31.1 % in 2004 for the comparable three month period and decreased to 23.0% in 2005 from 30.7% in 2004 for the comparable six month period. The percentage decrease is the result of the product mix and the reduction of sales within the automotive industry.

Selling general & administrative expenses were $3,413 for the second quarter of 2005, compared to $3,576 for the second quarter of 2004. For the six months ended June 30, 2005, selling general and administrative expenses were $7,005 compared to $7,270 for the six month period ended June 30, 2004. Management continues to pursue a concerted effort to control and reduce these costs as appropriate.

Operating income for the second quarter of 2005 was $1,736 compared to $2,558 for the second quarter of 2004. For the six months ended June 30, 2005, operating income was $2,629 compared to operating income of $4,321 for the comparable period in 2004. The decrease in operating income was the result of the unfavorable sales mix as well as the reduced sales in the automotive market as noted above.

Other income (loss) for the second quarter of 2005 was ($365) compared to $22 for the second quarter of 2004. For the six months ended June 30, 2005, other income (loss) was ($76) compared to other income of $37 for the comparable period in 2004. The differences represent the recognition of a loss upon the termination of a capital lease more fully described in Note 7.

Interest expense for the second quarter was $323 compared to $578 in the corresponding period of 2004. For the six months ended June 30, 2005, interest expense was $774 compared to $1,072 in the corresponding period of 2004. The interest reduction relates to the various payments and reductions in the debt instruments between the periods.

Net income for the second quarter of 2005 was $718 or 6 cents per share basic and diluted compared to net income of $1,216 or 11 cents per share basic and 10 cents per share diluted in the comparable period of 2004. Net income for the six months ended June 30, 2005 was $1,174 or 10 cents per share basic and diluted compared to net income of $2,067 or 18 cents per share basic and 16 cents per share diluted for the six months ended June 30, 2004.

Liquidity and Capital Resources

On February 20, 2004, the Newcor credit facility that was entered into on January 31, 2003 was terminated by Newcor and a new bank facility (the 2004 Credit Agreement) was entered into with National City Bank. The 2004 Credit Agreement allowed for $6,000 of available borrowings with reducing availability based upon a three year equal monthly amortization schedule, secured by the machinery and equipment owned by Newcor and its subsidiaries, except the machinery and equipment securing the $2,624 of equipment notes. As of December 31, 2004 there was $4,400 of available borrowings net of a $700 outstanding letter of credit under the 2004 Credit Agreement none of which was outstanding as of December 31, 2004. In March 2005, the available borrowings under the 2004 Credit Agreement were reduced to $ 2,800. At June 30, 2005, $ 2,100 was available net of a $700 outstanding letter of credit, none of which was outstanding.

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For the six months ended June 30, 2005, the Company generated $8,421 in operating activities as compared to generating $5,327 in the corresponding period of the preceding year. For the six months ended June 30, 2005, the Company utilized $2,700 in its investment activities, principally for the acquisition of capital equipment. In the corresponding period of the preceding year, the Company utilized $152 of cash in its investment activities, principally for the acquisition of capital equipment. Cash totaling $398 was used in financing activities during the six months ended June 30, 2005 for the repayment of the Newcor term loan, compared to using $4,446 for the six months ended June 30, 2004 principally for repayment of the Newcor term loan netted by new borrowings on the revolving credit line.

At June 30, 2005, the Company reported working capital of approximately $32,265 and a current ratio of 2.6 to 1. In addition, as described in Note 3 to the Consolidated Financial Statements, the Company had $25,389 of long-term debt outstanding. The Company is obtaining its working capital needs through its existing cash balances as well as the revolving credit line totaling $2,800 described above which the Company considers to be adequate for its current working capital needs.

ITEM 4. Controls and Procedures

As of the end of the period covered by this report, the Company’s Chief Executive Officer and Chief Financial Officer, David A. Segal, evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rule 13a-14(c) and 15d-14(c) under the Securities and Exchange Act of 1934 as amended). Based on that evaluation, he has concluded that the Company’s disclosure controls and procedures in place are effective in all material respects to insure that the information relating to the Company in the reports that it filed under the Securities and Exchange Act of 1934, as amended, is recorded, processed and summarized as and when required.

As regards internal controls, his review did not indicate any significant changes in internal controls or other factors that have materially affected or is reasonably likely to materially affect the registrant’s internal controls or financial reporting. The evaluation process and its results were reported to the Company’s Audit Committee and to the outside auditors.

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PART II. OTHER INFORMATION

ITEM 6. Exhibits

(a.) Exhibits

2.1	Agreement of Merger and Plan of Reorganization, EXX INC. (1)
2.2	Amendment to Agreement of Merger and Plan of Reorganization, EXX INC. (2)
3.1	Articles of Incorporation, EXX INC. (1)
4.1	Newcor, Inc. Senior Increasing Rate Notes due 2013 Indenture. (7)
10.1	Amendment dated March 27, 1998 to employment agreement with David A. Segal. (3)
10.2	Employment Agreement covering Newcor employment with David A. Segal dated September 3, 2001. (4)
10.3	Addendum to Employment Agreement covering Newcor employment with David A. Segal. (5)
10.4	Employment Agreement covering Newcor employment with James J. Connor dated August 9, 2000. (6)
10.5	Addendum to Employment Agreement covering Newcor employment with James J. Connor. (5)
10.6	Addendum to Change in Control Agreement covering Newcor employment with James J. Connor (5)
10.7	Credit Agreement between Newcor, Inc. and its subsidiaries and National City Bank of Michigan-Illinois dated February 20, 2004. (8)
10.8	First Amendment to 2004 Credit Agreement between Newcor, Inc and its subsidiaries and National City Bank dated March 28, 2005.
31	Certification of Chief Executive Officer and Chief Financial Officer under Section 302 of the Sarbanes- Oxley Act of 2002.
32	Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

(1) Incorporated by reference to EXX INC Form S-4 Registration Statement dated July 25, 1994.

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ITEM 6. Exhibits (continued)

(2) Incorporated by reference to EXX INC Form S-4 Amendment No. 1 dated August 16, 1994.

(3) Incorporated by reference to EXX INC Form 10-K Report for the year ended December 31, 1997 filed March 31, 1998.

(4) Incorporated by reference to Newcor, Inc. Form 10-Q Report dated September 30, 2001.

(5) Incorporated by reference to EXX INC Form 10-Q Report dated September 30, 2003.

(6) Incorporated by reference to Newcor, Inc. Form 10-K Report dated December 31, 2003.

(7) Incorporated by reference to EXX INC Form 10-Q Report dated June 30, 2003.

(8) Incorporated by reference to EXX INC Form 10-Q Report dated March 31, 2004.

SIGNATURE

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.

	EXX INC
Date: August 10, 2005	/s/ David A. Segal
	David A. Segal
	Chairman of the Board
	Chief Executive Officer
	Chief Financial Officer

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EX-10.8

Exhibit 10.8

FIRST AMENDMENT TO

CREDIT AGREEMENT

THIS FIRST AMENDMENT TO CREDIT AGREEMENT (the “First Amendment”) dated as of March 28, 2005, is an amendment to that certain CREDIT AGREEMENT dated February 20, 2004 (the “Original Agreement”), and is by and among NEWCOR, INC., a Delaware corporation (“Borrower”), the other parties identified on the signature pages hereto as Guarantors and such other parties as may from time to time become a party hereto (“Guarantors”), and NATIONAL CITY BANK OF THE MIDWEST (formerly known as NATIONAL CITY BANK OF MICHIGAN/ILLINOIS), a national banking association, Individually and as agent for NATIONAL CITY BANK a national banking association (“Lender”).

RECITALS:

A. Capitalized terms used but not otherwise defined in this First Amendment shall have the meanings ascribed thereto in the Original Agreement. Reference in any Loan Document to the Original Agreement shall be deemed to refer to the Original Agreement as amended by this First Amendment.

B. The Borrower and the Bank desire to amend the Original Agreement to reduce the amount of the Revolving Credit Loan.

NOW THEREFORE, in consideration of the mutual covenants contained herein and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

Amendments to the Original Agreement,

(a) Section 2.1 of the Original Agreement is hereby amended by decreasing the amount of the Revolving Credit Loan from Six Million and 00/100 Dollars ($6,000,000.00) to Two Million Eight Hundred Thousand and 00/100 Dollars ($2,800,000.00) until Maturity and deleting all references to the $300,000 per quarter reduction.

(b) For purposes of Section 2. 1 (d), the unused revolving credit loan fee shall be calculated based upon the reduced amount of the Revolving Credit Loan as set forth immediately above.

2. Representations. Borrower and Guarantors represent and warrant to Bank (and Bank relies upon such representations and warranties in entering into this First Amendment) as follows:

(a) Organization Documents; No Stockholder Changes. Since February 20, 2004, there have been no amendments to the Articles of Incorporation or By-laws and there have been no changes in the ownership of any of the stockholders of Borrower or any Guarantor;

(b) No Events of Default. No Event of Default has occurred and is continuing as of the date hereof and no event or condition which, with the giving of notice, the lapse of time, or both, would constitute an Event of Default, has occurred and is continuing as of the date hereof;

(e) Execution, Delivery and Performance. Execution, delivery and performance of this First Amendment and any other documents and instruments required under this First Amendment or the Original Agreement are within the corporate powers, have been duly authorized, are not in contravention of law or the terms of the Articles of Incorporation or Bylaws, of each of Borrower and each Guarantor, and do not require the consent or approval of any governmental body, agency, or authority, and this First Amendment and any other documents and instruments required under this First Amendment or the Original Agreement will be valid and binding in accordance with their terms.

3. Guarantor Acknowledgement and Consent. The Guarantors hereby acknowledge and consent to this First Amendment and agree that they remain obligated to Bank on the Obligations pursuant to the Guarantees and each Guarantor shall execute this First Amendment constituting the acknowledgment and agreement of each Guarantor to the amendments contained herein.

4. Miscellaneous.

(a) Binding Effect. This Amendment shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns, provided that no party other than Bank may assign any of its rights or obligations hereunder without the prior written consent of Bank.

(b) Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF MICHIGAN APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE.

(c) Counterparts; Facsimile Signatures. This Amendment may be executed in multiple counterparts, each of which shall be deemed to be an original and all of which when taken together shall constitute one and the same instrument. A facsimile signature shall be effective as an original signature.

[SIGNATURES ON FOLLOWING PAGE]

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IN WITNESS WHEREOF, the parties hereto have executed this First Amendment as of the date first above written.

BORROWER:		LENDER:
NEWCOR, INC., a Delaware corporation		NATIONAL CITY BANK OF THE MIDWEST,
		Individually and as Agent for NATIONAL CITY BANK,
		a national banking association,
By:	/s/ James J. Connor	/S/ Steven E. Dicker
	James J. Connor	By:	Steve E. Dicker
Its:	President	Its:	Vice President
GUARANTORS (Operating):		GUARANTORS (Non-Operating):
DECO ENGINEERING, INC., a Michigan corporation		CORUNNA REALTY CORP., a Michigan corporation
By:	/s/ James J. Connor	By:	/s/ James J. Connor
	James J. Connor		James J. Connor
Its:	President	Its:	President
ROCHESTER GEAR, INC a Michigan corporation		WALKERTON REALTY CORP., an Indiana corporation
By:	/s/ James J. Connor	By:	/s/ James J. Connor
	James J. Connor		James J. Connor
Its:	President	Its:	President
PLASTRONICS PLUS, INC., a Wisconsin corporation		BLACKHAWK REALTY CORP., an Iowa corporation
By:	/s/ James J. Connor	By:	/s/ James J. Connor
	James J. Connor		James J. Connor
Its:	President	Its:	President
BLACKHAWK ENGINEERING, INC., an Iowa corporation		CLIFFORD REALTY CORP., a Michigan corporation
By:	/s/ James J. Connor	By:	/s/ James J. Connor
	James J. Connor		James J. Connor
Its:	President	Its:	President

[SIGNATURES CONTINUED ON FOLLOWING PAGE]

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GUARANTORS (Operating) (con’t):		GUARANTORS (Non-Operating) (con’t):
MACHINE TOOL & GEAR, INC., a Michigan corporation		BAY CITY REAL ESTATE CORP., a Michigan corporation,
By:	/s/ James J. Connor	By:	/s/ James J. Connor
	James J. Connor		James J. Connor
its:	President	Its:	President
BORAMCO, INC., an Indiana corporation		EAST TROY REALTY CORP., a Wisconsin corporation,
By:	/s/ James J. Connor	By:	/s/ James J. Connor
	James J. Connor		James J. Connor
Its:	President	Its:	President
NEWCOR FOREIGN SALES, INC., a U.S. Virgin Islands corporation
By:	/s/ James J. Connor
	James J. Connor
Its:	President

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EX-31

Exhibit 31

CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER PURSUANT TO SECTION 302 OF THE

SARBANES-OXLEY ACT OF 2002

I, David A. Segal, Chief Executive Officer and Chief Financial Officer hereby certify that:

1. I have reviewed this quarterly report on Form 10-Q of EXX INC (the “Registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;

b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that had materially affected or is reasonably likely to materially affect registrant’s internal control over financial reporting; and

5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors:

a) All significant deficiencies in the design or operation of internal controls over financial reporting which could adversely affect the registrant’s ability to record, process, summarize and report financial data and identified for the registrant’s auditors any material weaknesses in internal controls; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date: August 10, 2005	By:	/s/ David A. Segal
		David A. Segal
		Chief Executive Officer
		Chief Financial Officer

EX-32

Exhibit 32

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 EXX INC (the “Company”) on Form 10-Q for the period ending June 30, 2005 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, David A. Segal, Chairman of the Board, Chief Executive Officer and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adapted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(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 operations of the Company.

Date: August 10, 2005	By:	/s/ David A. Segal
		David A. Segal
		Chairman of the Board
		Chief Executive Officer
		Chief Financial Officer

* A signed original of the written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff, upon request.