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FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2003 Commission file number 333-73996
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OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ____________to____________
MORGAN GROUP HOLDING CO.
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(Exact name of Registrant as specified in its charter)
Delaware 13-4196940
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State of other jurisdiction (I.R.S. Employer
incorporation or organization Identification No.)
401 Theodore Fremd Avenue, Rye, NY 10580
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (914) 921-1877
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Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to section 12(g) of the Act: None
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 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 mark if disclosure of delinquent filers pursuant to Item 405 of
Regulations S-K is not contained herein, and will not be contained, to the best
of the Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K, or any amendment to
this Form 10-K. [ ]
Indicate by check mark whether the Registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act). Yes No X
As of June 30, 2003, the aggregate market value of the Registrant's voting and
nonvoting common equity held by non-affiliates of the Registrant was
approximately $175,700, which value, solely for the purposes of this
calculation, excludes shares held by the Registrant's officers, directors, and
their affiliates. Such exclusion should not be deemed a determination or an
admission by the issuer that all such individuals are, in fact, affiliates of
the issuer.
The number of outstanding shares of the Registrant's Common Stock was 3,055,345
as of March 25, 2004.
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PART I
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Item 1. Business.
Morgan Group Holding Co. (the "Company" or "MGHL") was incorporated in
November 2001 to serve, among other business purposes, as a holding company for
Lynch Interactive Corporation's controlling interest in The Morgan Group, Inc.
Upon the Company's formation as a wholly owned subsidiary of Lynch Interactive
Corporation, Lynch Interactive Corporation made a capital contribution to MGHL
of $500,000. Lynch Interactive Corporation also transferred to us 161,100 shares
of The Morgan Group, Inc.'s outstanding Class A common stock, warrants to
purchase an additional 161,100 such shares at $9.00 per share, 2,200,000 shares
of The Morgan Group, Inc.'s Class B common stock and warrants to purchase an
additional 2,200,000 such shares at $9.00 per share, giving MGHL control of more
than 80% of The Morgan Group, Inc.'s aggregate voting power. On January 24,
2002, Lynch Interactive spun off all but 235,294 of its shares in MGHL to its
stockholders.
Unfortunately, weakened by poor industry conditions and management mistakes. A
combination of industry dynamics, poor management decisions, and a surge in
insurance costs crippled Morgan. On October 3, 2002 Morgan ceased operations
when its liability insurance expired and it was unable to secure replacement
insurance. On October 18, 2002, The Morgan Group, Inc. and two of its operating
subsidiaries filed voluntary petitions under Chapter 11 of the United States
Bankruptcy Code in the United States Bankruptcy Court for the Northern District
of Indiana, South Bend Division. As of December 31, 2003, the Debtors were
continuing to conduct an orderly liquidation of their assets.
Effective October 15, 2002, the shares of The Morgan Group, Inc., Class A
Common Stock were delisted from the American Stock Exchange. The stock exchange
determined that The Morgan Group, Inc.'s Class A Common Stock no longer
satisfied Sections 1002, 1003 and 1009 of the listing rules.
On November 12, 2002, The Morgan Group, Inc. filed a Certification and
Notice of Termination of Registration under Section 12(g) of the Securities
Exchange Act of 1934.
The Company expects that its ownership interest in Then Morgan Group, Inc.
will have no residual value upon completion of the liquidation of the assets of
The Morgan Group Inc. The Company's strategy is to look for additional
investment opportunities. However the loss did yield a capital loss of about $4
million.
Item 2. Properties.
The Company owns no properties.
Item 3. Legal Proceedings.
The Company is not a party to any legal proceedings.
Item 4. Submission of Matters To a Vote of Security Holders.
None during the fourth quarter of 2003.
-2-
PART II
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Item 5. Market For The Registrant's Common Equity And Related Stockholder
Matters.
The common stock commenced trading on the over-the-counter market on
February 21, 2002. The following table sets forth the high and low market prices
of the common stock for the periods indicated, as reported by published sources.
High Low
2002 Fiscal Year
First Quarter (beginning February 21, 2002) .......... $ 1.75 $ 0.85
Second Quarter ....................................... $ 1.40 $ 0.51
Third Quarter ........................................ $ 0.55 $ 0.12
Fourth Quarter ....................................... $ 0.20 $ 0.02
2003 Fiscal Year
First Quarter ........................................ $ 0.070 $ 0.050
Second Quarter ....................................... $ 0.140 $ 0.065
Third Quarter ........................................ $ 0.140 $ 0.080
Fourth Quarter ....................................... $ 0.110 $ 0.100
As of March 25, 2004, there were approximately 832 holders of record of the
Company's common stock.
The Company has never declared a cash dividend on its common stock and its Board
of Directors does not anticipate that it will pay cash dividends in the
foreseeable future.
The Company has never repurchased any of its equity securities and does not
anticipate that it will do so in the foreseeable future.
-3-
Item 6. Selected Financial Data.
Morgan Group Holding Co.
Selected Financial Data
(Dollars and shares in thousands, except per share amounts)
December 31, (1)
------- ------- ------ ------- ------
2003 2002 2001 2000 1999
------- ------- ------ ------- ------
Administrative expenses ............................................... $ (35) $ (64) $ -- $ -- $ --
Investment income ..................................................... 3 6 -- -- --
------- ------- ------ ------- ------
Loss from continuing operations ....................................... (32) (58) -- -- --
------- ------- ------ ------- ------
Discontinued operations:
Loss from operations before cumulative effect of accounting change
of The Morgan Group, Inc. - net of income tax benefit (provision) of
$--, $1,125, $910, and $(2,277) and $(187) respectively, and minority
interests of $--, $3,021, $603, $2,133 and $(28) respectively ......... -- (5,358) (854) (2,492) (3)
Cumulative effect of accounting change at The Morgan
Group Inc., net of minority interests of $722 ....................... -- (1,568) -- -- --
Gain from the adoption of liquidation basis of
accounting at The Morgan Group, Inc. ................................. -- 2,182 -- -- --
------- ------- ------ ------- ------
Net loss ........................................................... $ (32) $(4,802) $ (854) $(2,492) $ (3)
======= ======= ====== ======= ======
Basic and diluted loss per share:
Loss from continuing operations ....................................... $ (0.01) $ (0.02) $-- $-- $--
Loss from operations before cumulative effect of
accounting change of The Morgan Group, Inc. ........................ -- (1.75) (0.28) (0.82) (0.000)
Cumulative effect of accounting change at The Morgan
Group, Inc........................................................... -- (0.52) -- -- --
Gain from the adoption of liquidation basis of
accounting at The Morgan Group Inc. ................................. -- 0.71 -- -- --
======= ======= ====== ======= ======
Net loss per common share ............................................ $ (0.01) $ (1.57) $(0.28) $ (0.82) $(0.00)
======= ======= ====== ======= ======
Weighted average shares outstanding ........................ 3,055 3,055 3,055 3,055 3.055
December 31, (1)
------- ------- ------ ------- ------
2003 2002 2001 2000 1999
------- ------- ------ ------- ------
Cash ................................................................... $ 399 $ 433 $ 500 $ -- $ --
Total Assets ........................................................... $ 399 $ 433 $ 5,235 $ 3,661 $6,171
Stockholders Equity .................................................... $ 399 $ 431 $ 5,235 $ -- $ --
Equity, Investments by and advances from Lynch
Interactive Corporation ............................................. $ -- $ -- $ -- $ 3,661 $6,171
(1) We were incorporated in November 2001 to serve as a holding company for
Lynch Interactive Corporation's controlling interest in The Morgan Group,
Inc. The transfer of the controlling interest was made to us on December
18, 2001. The accompanying combined financial data represents the
combination, on a retroactive basis, of all of Lynch Interactive
Corporation's interest in The Morgan Group, Inc. and the consolidated
financial statements of The Morgan Group, Inc. as if the transfer by Lynch
Interactive Corporation occurred on January 1, 1998. Subsequent to December
18, 2002, the financial statements represent the consolidated results of
the Company. During 2002, due to Morgan's ceasing operations, its financial
results are treated as discontinued operations in the above data. On
October 18, 2002, Morgan filed for bankruptcy and adopted the liquidation
basis of accounting and the Company deconsolidated Morgan at that point.
-4-
Item 7. Management's Discussion and Analysis of Financial Condition and Plan of
Operation.
Overview
The Company was incorporated in November 2001 as a wholly-owned subsidiary of
Lynch Interactive Corporation ("Interactive") to serve as an acquisition
vehicle. Initially, we received $500,000 cash and 68.5% of The Morgan Group,
Inc. (Morgan)'s equity interest and 80.8% of Morgan's voting interest. On
January 24, 2002, Interactive spun off 2,820,051 shares of our common stock
through a pro rata distribution ("Spin-Off") to its stockholders. Interactive
retained 235,294 shares at the time of the spin-off.
A combination of industry dynamics, poor management decisions, and a surge in
insurance costs crippled Morgan. On October 3, 2002 Morgan ceased operations
when its liability insurance expired and it was unable to secure replacement
insurance. On October 18, 2002, Morgan and two of its operating subsidiaries
filed voluntary petitions under Chapter 11 of the United States Bankruptcy Code
in the United States Bankruptcy Court for the Northern District of Indiana,
South Bend Division for the purpose of conducting an orderly liquidation of
Morgan's assets.
As Morgan is in the process liquidation, in the accompanying financial
statements the assets and liabilities and results of operations of Morgan have
been reflected as a discontinued operation. In addition, the Company's
management currently believes that it is very unlikely that the Company will
realize any value from its equity ownership in Morgan. Given the fact that
Holding has no obligation or intention to fund any of Morgan's liabilities,
management believes that the Company's investment in Morgan will to have no
value after the liquidation. As the liquidation of Morgan is under the control
of the bankruptcy court, the Company believes it has relinquished control of
Morgan and accordingly has ceased consolidating the financial statements of
Morgan. As the Company's investment in Morgan was a negative of $2,182,000 at
the date of adoption of the plan of liquidation. This resulted in a gain to
Holdings of that amount in 2002.
On October 18, 2002, Morgan adopted the liquidation basis of accounting and
accordingly, Morgan's assets and liabilities have been adjusted to estimate net
realizable value. As the carry value of organ's liabilities exceeded the fair
value of its assets, the liabilities were reduced to equal the estimated net
realizable value of the assets.
As of December 31, 2003, the Company's only assets consisted of $399,000 in cash
and an unrecognized asset relating to capital loss carryforward of about $4
million.
The Company currently has no operating businesses and will seek acquisitions as
part of its strategic alternatives. Its only costs are the administrative
expenses required to make the regulatory filings needed to maintain its public
status. These costs are estimated at $25,000 to $75,000 per year.
Results of Operations
For the year ended December 31, 2003, the Company incurred administrative
expenses of $35,000 and $64,000 of expenses were incurred during the year ended
December 31, 2002. As the Company was formed in November 2001 and Lynch
Interactive paid the expenses associated with the spin-off, no such expenses
administration were incurred by the Company in the year ended December 31, 2001.
Investment income of $3,000 and $6,000 was recorded during the two years ended
December 31, 2003 as a result of the Company's investment in a United States
Treasury money market fund.
-5-
Item 8. Financial Statements and Supplementary Data.
Financial Statements
Balance Sheets as of
December 31, 2003 and December 31, 2002
Statements of Operations for the
Three Years Ended December 31, 2003
Statements of Cash Flows for the
Three Years Ended December 31, 2003
Statements of Equity, Investments by
And Advances from Lynch Interactive
Corporation
Notes to Financial
Statements as of December 31, 2003
-6-
Morgan Group Holding Co.
Balance Sheets
(Dollars in thousands, except per share amounts)
December 31,
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2003 2002
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ASSETS
Current assets:
Cash and cash equivalents ................... $ 399 $ 433
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Total current assets ..................... 399 433
Net assets of The Morgan Group, Inc. ....... -- --
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Total assets ............................. $ 399 $ 433
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LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
Current liabilities:
Accrued expenses ............................ $ -- $ 2
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Total current liabilities ................ -- 2
SHAREHOLDERS' EQUITY
Preferred stock, $0.01 par value,
1,000,000 shares authorized,
none outstanding .......................... -- --
Common stock, $0.01 par value,
10,000,000 shares authorized,
3,055,345 outstanding ..................... 30 30
Additional paid-in-capital .................. 5,612 5,612
Accumulated deficit ......................... (5,243) (5,211)
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Total shareholders' equity ............... 399 431
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Total liabilities and shareholders' equity $ 399 $ 433
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See notes to financial statements
-7-
Morgan Group Holding Co.
Statements of Operations
(Dollars and shares in thousands, except per share amounts)
December 31,
--------------------------------
2003 2002 2001
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Administrative expenses ................................... $ (35) $ (64) $ --
Investment income ......................................... 3 6 --
------- ------- -------
Loss from continuing operations ......................... (32) (58) --
------- ------- -------
Discontinued operations (Notes 1 and 2):
Loss from operations before cumulative effect of
accounting change of The Morgan Group, Inc. - net of
income tax benefit (provision) of $--, $1,125 and $910,
respectively, and minority interests of $--, $3,021 and
$603 respectively ....................................... -- (5,358) (854)
Cumulative effect of accounting change at The Morgan Group
Inc., net of minority interests of $722 ................. -- (1,568) --
Gain from the deconsolidation of The Morgan Group, Inc. ... -- 2,182 --
------- ------- -------
Net loss .............................................. $ (32) $(4,802) $ (854)
======= ======= =======
Basic and diluted loss per share:
Loss from continuing operations ........................... $ (0.01) $ (0.02) --
Loss from operations before cumulative effect of accounting
change of The Morgan Group, Inc. ....................... -- (1.75) $ (0.28
Cumulative effect of accounting change at The Morgan Group,
Inc .................................................... -- (0.52) --
Gain from the deconsolidation of The Morgan Group Inc. .... -- 0.71 --
------- ------- -------
Net loss per common share ............................. $ (0.01) $ (1.57) $ (0.28)
======= ======= =======
Weighted average shares outstanding ....... 3,055 3,055 3,055
See accompanying notes
-8-
Morgan Group Holding Co.
Statements of Cash Flows
(Dollars in thousands)
December 31,
----------------------------------
2003 2002 2001
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Operating activities:
Net loss ............................................ $ (32) $(4,802) $ (854)
Adjustments to reconcile net loss to net
cash used in operating activities:
Increase (decrease) in accrued expenses ........... (2) 2 --
Non-cash items and changes in operating assets
and liabilities relating to the operations of The
Morgan Group, Inc. ................................ -- 3,082 1,363
------- ------- -------
Net cash provided by (used in) operating activities (34) (1,718) 509
------- ------- -------
Investing activities:
Investment in the Morgan Group Inc. ................. -- (11) (2,000)
Investing activities relating to operations of The
Morgan Group, Inc. ................................. -- 453 (753)
------- ------- -------
Net cash provided by (used in) investing activities . -- 442 (2,753)
------- ------- -------
Financing activities:
Investment by and advances from(to)Lynch Interactive
Corporation ...................................... -- -- 2,500
Financing activities relating to operations of The
Morgan Group, Inc. ................................. -- 1,209 244
------- ------- -------
Net cash provided by financing activities .............. -- 1,198 2,744
------- ------- -------
Net increase (decrease) in cash and equivalents ........ (34) (67) 500
Cash and cash equivalents at beginning of period ....... 433 500 --
------- ------- -------
Cash and cash equivalents at end of period ............. $ 399 $ 433 $ 500
======= ======= =======
See accompanying notes
-9-
Morgan Group Holding Co.
Statements of Equity, Investments by and
Advances from Lynch Interactive Corporation
(Dollars in thousands)
Equity,
Investments
by and
Advances from
Additional Lynch
Common Stock Common Paid-in Accumulated Interactive Total
Outstanding Stock Captial Deficit Corporation
------------------------------------------------------------------------------
Balance at January 1, 2001 ........ -- $ -- $ -- $ -- 3,661 $ 3,661
Capital transactions of The Morgan
Group, Inc. ....................... -- -- -- -- (72) (72)
Investment of Lynch Interactive
Corporation ....................... -- -- -- -- 2,000 2,000
Net loss through December 18, 2001 -- -- -- -- (445) (445)
Issuance of shares by Lynch
Interactive Corporation ........... 3,055,345 30 5,614 -- (5,144) 500
Net loss subsequent to December 18,
2001 -- -- -- (409) -- (409)
---------- ---------- ---------- ---------- ---------- ----------
Balance at December 31, 2001 ...... 3,055,345 30 5,614 (409) -- 5,235
Capital transactions of The Morgan
Group, Inc. ....................... -- -- (2) -- -- (2)
Net Loss for year ended December
31, 2002 .......................... -- -- -- (4,802) -- (4,802)
---------- ---------- ---------- ---------- ---------- ----------
Balance at December 31, 2002 ...... 3,055,345 30 5,612 (5,211) -- 431
Net loss for year end December 31,
2003 -- -- -- (32) -- (32)
---------- ---------- ---------- ---------- ---------- ----------
3,055,345 $ 30 $ 5,612 $ (5,243) $ -- $ 399
========== ========== ========== ========== ========== ==========
See accompanying notes.
-10-
Morgan Group Holding Co.
Notes to Financial Statements
Note 1. Basis of Presentation
Morgan Group Holding Co. ("Holding" or "the Company") was incorporated in
November 2001 as a wholly-owned subsidiary of Lynch Interactive Corporation
("Interactive") to serve, among other business purposes, as a holding
company for Interactive's controlling interest in The Morgan Group, Inc.
("Morgan"). On December 18, 2001, Interactive's controlling interest in
Morgan was transferred to Holding. At the time, Holding owned 68.5% of
Morgan's equity interest and 80.8% of Morgan's voting interest. On January
24, 2002, Interactive spun off 2,820,051 shares of our common stock through
a pro rata distribution ("Spin-Off") to its stockholders. Interactive
retained 235,294 shares of our common stock to be distributed in connection
with the potential conversion of a convertible note that had been issued by
Interactive. Such note was repurchased by Interactive in 2002 and
Interactive retains the shares.
On October 3, 2002, Morgan ceased its operations when its liability
insurance expired and it was unable to secure replacement insurance. On
October 18, 2002, Morgan and two of its operating subsidiaries filed
voluntary petitions under Chapter 11 of the United States Bankruptcy Code
in the United States Bankruptcy Court for the Northern District of Indiana,
South Bend Division for the purpose of conducting an orderly liquidation of
Morgan's assets.
As Morgan has ceased operations and is in the process liquidating itself,
in the accompanying financial statements, the assets and liabilities and
results of operations of Morgan have been reflected as a discontinued
operation. In addition, Holding's management currently believes, it is very
unlikely that it will realize any value from its equity ownership in
Morgan, and given the fact that Holding has no obligation or intention to
fund any of Morgan's liabilities, its investment in Morgan was believed to
have no value after the liquidation. As the liquidation of Morgan is under
the control of the bankruptcy court, the Company believes it has
relinquished control of Morgan and accordingly, has ceased consolidating
the financial statements of Morgan. As Holding's investment in Morgan was a
negative $2,182,000, at the date of adoption of the plan of liquidation,
this resulted in a gain to Holding of that amount.
On October 18, 2002, Morgan adopted the liquidation basis of accounting and
accordingly, Morgan's assets and liabilities have been adjusted to estimate
net realizable value. As the carry value of Morgan's liabilities exceeded
the fair value of its assets, the liabilities were reduced to equal the
estimated net realizable value of the assets.
The financial statements have been prepared using the historical basis of
assets and liabilities and historical results of Interactive's interest in
Morgan, which were contributed to the Company on December 18, 2001.
However, the historical financial information presented herein reflects
periods during which the Company did not operate as an independent public
company and accordingly, certain assumptions were made in preparing such
financial information. Such information, therefore, may not necessarily
reflect the results of operations, financial condition or cash flows of the
Company in the future or what they would have been had the Company been an
independent public company during the reporting periods.
The financial statements represent combined financial statements through
December 18, 2001 and include the accounts of Holding, Morgan and its
subsidiaries. Subsequent to December 18, 2001, the financial statements
represent the consolidated results of those entities. As noted above as of
October 18, 2002, the Company deconsolidated the operations of Morgan.
Significant intercompany accounts and transactions have been eliminated in
combination/consolidation.
Net loss per common share ("EPS") is computed using the number of common
shares issued in connection with the Spin-Off as if such shares had been
outstanding for all periods presented.
All highly liquid investments with maturity of three months or less when
purchased are considered to be cash equivalents. The carrying value of cash
equivalents approximates its fair value based on its nature.
-11-
At December 31, 2003 and 2002 all cash and cash equivalents were invested
in a United States Treasury money market fund, which an affiliate of the
Company serves as the investment manager.
At December 31, 2003 and 2002, the carrying value of financial instruments
such as cash and cash equivalents, accounts receivable, trade payables and
long-term debt approximates their fair values. Fair value is determined
based on expected future cash flows, discounted at market interest rates,
and other appropriate valuation methodologies.
The accompanying unaudited consolidated financial statements reflect, in
the opinion of management, all adjustments (consisting of normal recurring
items) necessary for a fair presentation, in all material respects, of the
financial position and results of operations for the periods presented. The
preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and
assumptions. Such estimates and assumptions affect the reported amounts of
assets and liabilities, the disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could
differ from those estimates. The results of operations for the interim
periods are not necessarily indicative of the results for the entire year.
The financial statements include the accounts of the Company and through
October, 18, 2002, its majority owned subsidiary, Morgan. Morgan has the
following subsidiaries: Morgan Drive Away, Inc., TDI, Inc., Interstate
Indemnity Company, and Morgan Finance, Inc., all of which are wholly owned.
Morgan Drive Away, Inc. has two subsidiaries, Transport Services Unlimited,
Inc. and MDA Corp. Significant intercompany accounts and transactions have
been eliminated in consolidation. During 2002, Morgan is treated as a
discontinued operations and previously issued financial statements have
been restated to reflect that presentation.
Note 2. Net assets of Discontinued Operation
At December 31, 2003 and 2002, the estimated value of Morgan's assets in
liquidation were insufficient to satisfy its estimated obligations.
Note 3. Goodwill Impairment
On January 1, 2002, Morgan adopted Statement of Financial Accounting
Standard No. 142, Goodwill and Other Intangible Assets (SFAS No. 142). This
Standard eliminates goodwill amortization and requires an evaluation of
goodwill for impairment (at the reporting unit level) upon adoption of the
Standard, as well as subsequent evaluations on an annual basis, and more
frequently if circumstances indicate a possible impairment. This impairment
test is comprised of two steps. The initial step is designed to identify
potential goodwill impairment by comparing an estimate of the fair value of
the applicable reporting unit to its carrying value, including goodwill. If
the carrying value exceeds fair value, a second step is performed, which
compares the implied fair value of the applicable reporting unit's goodwill
with the carrying amount of that goodwill, to measure the amount of
goodwill impairment, if any. Upon adoption, Morgan performed the
transitional impairment test which resulted in an impairment of $2,290,000
which is classified as a cumulative effect of a change in accounting
principle for the year ended December 31, 2002, as required by SFAS No.
142.
Note 4. Issuance of Non-transferable Warrants
On December 12, 2001, Morgan issued non-transferable warrants to purchase
shares of common stock to the holders of Class A and Class B common stock.
Each warrant entitled the holder to purchase one share of their same class
of common stock at an exercise price of $9.00 per share through the
expiration date of December 12, 2006. The Class A warrants provided that
the exercise price would be reduced to $6.00 per share during a Reduction
Period of at least 30 days during the five-year exercise period.
-12-
On February 19, 2002, Morgan's Board of Directors agreed to set the
exercise price reduction period on the Class A warrants to begin on
February 26, 2002 and to extend for 63 days, expiring on April 30, 2002
(the "Reduction Period"). Morgan's Board of Directors agreed to reduce the
exercise price of the warrants to $2.25 per share, instead of $6.00 per
share, during the Reduction Period. Morgan's Board of Directors reduced the
exercise price to $2.25 to give warrant holders the opportunity to purchase
shares at a price in the range of recent trading prices of the Class A
common stock. All other terms regarding the warrants, including the
expiration date of the warrants, remain the same. As of the close of the
temporary Reduction Period on April 30, 2002, Morgan received $535,331 with
the exercise of 237,925 warrants at $2.25 each. The Company exercised 5,000
of its warrants. Subsequent to the exercise, the Company owned 64.2% of
Morgan's equity interest and 77.6% of Morgan's voting ownership.
Unexercised warrants remain outstanding and exercisable at $9.00 each.
Note 5. Income Taxes
No income tax benefit has recorded in the accompanying financial
statements, as the realization of such losses, for income tax purposes, is
dependent upon the generation of future taxable income during the period
when such losses would be deductible. Therefore, the recording of the
deferred tax asset of $1.5 million would be inconsistent with applicable
accounting rules.
Note 6. Segment Reporting
As the results of operations of the Morgan Group are currently being
accounted for as discontinued operation and the Holding currently have
limited operations there is no Segment Reporting.
Note 7. Commitments and Contingencies
Holding has not guaranteed any of the obligations of Morgan and it has no
further commitment or obligation to fund any creditors.
Item 9. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure.
Not Applicable.
PART III
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Item 10. Directors and Executive Officers of the Registrant.
The following table sets forth the name, business address, present
principal occupation, employment history, positions, offices or employments for
the past five years and ages as of March 25, 2004 for our executive officers and
directors. Members of the board are elected and serve for one year terms or
until their successors are elected and qualify.
Name Age Position
Mario J. Gabelli 61 Chief Executive Officer and Director
Robert E. Dolan 52 Chief Financial Officer and Director
John Fikre ..... 39 Vice President, Secretary and Director
-13-
- ----------------------
Mario J. Gabelli has served as Chairman, Chief Executive Officer, Chief
Investment Officer and a director of Gabelli Asset Management Inc. and its
predecessors since November 1976. In connection with those responsibilities, he
serves as director or trustee and/or an officer of registered investment
companies managed by subsidiaries of Gabelli Asset Management. Mr. Gabelli
serves as Vice Chairman and Chief Executive Officer of Lynch Interactive
Corporation, a public company engaged in multimedia; and Vice Chairman of Lynch
Corporation, a public company engaged in manufacturing. In addition, Mr. Gabelli
is the Chairman and Chief Executive Officer of Gabelli Group Capital Partners,
Inc., a private company. Mr. Gabelli also serves as a Governor of the American
Stock Exchange; Overseer of Columbia University Graduate School of Business;
Trustee of Fairfield University, Roger Williams University, Winston Churchill
Foundation and E.L. Wiegand Foundation; Director of the National Italian
American Foundation and the American-Italian Cancer Foundation; and Chairman,
Patron's Committee of Immaculate Conception School.
Robert E. Dolan has served as Chief Financial Officer of Lynch Interactive
Corporation (September 1999 to present), Director of Sunshine PCS Corporation
(November 2000 to present), and Chief Financial Officer of Lynch Corporation
(1993 to January 2000).
John Fikre has served as Vice President--Corporate Development, Secretary
and General Counsel of Lynch Interactive Corporation since August 2001. Prior to
joining Lynch Interactive Corporation, Mr. Fikre was an associate at the law
firm of Willkie Farr & Gallagher.
Compensation of Directors
The Company does not compensate its directors at the present time, although
it may do so in the future. The Company does, however, indemnify directors
pursuant to Delaware law and may reimburse them for certain out-of-pocket costs
in connection with serving as directors.
Indemnification of Directors and Officers
Under Section 145 of the Delaware General Corporation Law, the Company has
broad powers to indemnify its directors and officers against liabilities they
may incur in such capacities. The Company's certificate of incorporation
provides that its directors and officers shall be indemnified to the fullest
extent permitted by the Delaware law. The certificate of incorporation also
provides that the Company shall, to the fullest extent permitted by Delaware
law, as amended from time to time, indemnify and advance expenses to each of its
currently acting and former directors, officers, employees and agents.
Delaware law provides that a corporation may limit the liability of each
director to the corporation or its stockholders for monetary damages except for
liability:
o for any breach of the director's duty of loyalty to the corporation or its
stockholders,
o for acts or omissions not in good faith or that involve intentional
misconduct or a knowing violation of law,
o in respect of certain unlawful dividend payments or stock redemptions or
repurchases and
o for any transaction which the director derives an improper personal
benefit.
The Company's certificate of incorporation provides for the elimination and
limitation of the personal liability of its directors for monetary damages to
the fullest extent permitted by Delaware law. In addition, the certificate of
incorporation provides that if Delaware law is amended to authorize the further
elimination or limitation of the liability of a director, then the liability of
our directors shall be eliminated or limited to the fullest extent permitted by
Delaware law, as amended. The effect of this provision is to eliminate the
Company's rights and its stockholders rights, through stockholders' derivative
suits, to recover monetary damages against a director for breach of the
fiduciary duty of care as a director, except in the situations described above.
This provision does not limit or eliminate the Company's rights or its
stockholders' rights to seek non-monetary relief such as an injunction or
rescission in the event of a breach of a director's duty of care.
-14-
Insofar as indemnification for liabilities arising under the Securities Act
of 1933, as amended, may be permitted for its directors, officers, and
controlling persons, pursuant to the foregoing provisions, or otherwise, the
Company has been advised that in the opinion of the Securities and Exchange
Commission that this sort of indemnification is against public policy as
expressed in the Securities Act of 1933, as amended, and is therefore
unenforceable.
At present, there is no pending litigation or proceeding involving any of
our directors, officers, employees or agents where indemnification will be
required or permitted.
Item 11. Executive Compensation.
The Company does not pay any compensation to any person, including its
directors and executive officers.
Item 12. Security Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters.
The following table sets forth information concerning ownership of our
common stock as of March 25, 2004 by each person known by us to be the
beneficial owner of more than five percent of the common stock, each director,
each executive officer, and by all directors and executive officers as a group.
We believe that each stockholder has sole voting power and sole dispositive
power with respect to the shares beneficially owned by him. Unless otherwise
indicated, the address of each person listed below is 401 Theodore Fremd Avenue,
Rye, New York 10580.
Number of Shares of
Common Stock Percent of
Beneficial Owner Beneficially Owned Ownership
Mario J. Gabelli ................... 858,384(1) 28.1%
Robert E. Dolan .................... 579(2) **
John Fikre ......................... 0 0%
Lynch Interactive Corporation ...... 235,294 7.7%
All directors and executive officers
as a group (3 in total) ............ 858,963 28.1%
- -------------------
** Less than 1%
(1) Represents 283,090 shares of common stock owned directly by Mr. Gabelli,
340,000 shares owned by a limited partnership in which Mr. Gabelli is the
general partner and has approximately a 5% interest, and 235,294 shares
owned by Lynch Interactive Corporation (Mr. Gabelli is a "control person"
of Lynch Interactive Corporation and therefore shares owned by Lynch
Interactive Corporation are set forth in the table as also beneficially
owned by Mr. Gabelli). Mr. Gabelli disclaims beneficial ownership of the
shares owned by the partnership and Lynch Interactive Corporation, except
for his interest therein.
(2) Includes 70 shares registered in the name of Mr. Dolan's children with
respect to which Mr. Dolan has voting and investment power and 109 shares
owned by Mr. Dolan through the Lynch Interactive Corporation 401(k) Savings
Plan.
Item 13. Certain Relationships and Related Transactions.
Each of our directors and officers is also an officer of Lynch Interactive
Corporation.
-15-
On December 18, 2001, Lynch Interactive Corporation made a capital
contribution to us of $500,000 and assigned to us a services agreement with The
Morgan Group, Inc. pursuant to which The Morgan Group, Inc. agreed to pay
$100,000 per year for certain management services. The Morgan Group, Inc. has
not made any payments under this agreement since the first quarter of 2001 and
as a result of the bankruptcy and liquidation of its assets, the Company does
not expect to recover any amounts due under such agreement.
Immediately after the spin-off, Lynch Interactive Corporation retained
235,294 shares of the Company's common stock, which it held as escrow agent for
Cascade Investment LLC, the holder of an outstanding convertible promissory note
issued by Lynch Interactive Corporation. In the event that Cascade Investment
LLC converted all or a portion of the principal amount of that note into shares
of Lynch Interactive Corporation common stock prior to December 10, 2004, Lynch
Interactive Corporation would have transferred to Cascade Investment LLC a pro
rata portion of those 235,294 shares of common stock, depending on how much of
the principal amount of such note was converted, to Cascade Investment LLC.
However, on November 29, 2002, Lynch Interactive repurchased the remaining
outstanding principal amount such notes from Cascade Investment LLC and, as a
result, the 235,294 shares will be retained by Lynch Interactive Corporation.
Lynch Interactive Corporation has advised the Company that it will sell or
dispose of any shares of our common stock retained by it prior to the fifth
anniversary of the spin-off.
Item 14. Principal Accountant Fees and Services.
The Company did not engage an independent auditor to audit its financial
statements for the year ended December 31, 2003 and did not incur any audit
fees, audit-related fees, tax fees or other fees.
PART IV
-------
Item 15. Exhibits, Financial Statements, Schedules And Reports On Form 8-K.
(a) The following documents are filed as part of this Report:
(1) Financial Statements.
See Item 8.
(2) Financial Statement Schedules.
None
(3) Exhibits.
-16-
Exhibit Number Description
3.1 Certificate of Incorporation of the Company*
3.2 By-laws of the Company*
4.1 Revolving Credit and Term Loan Agreement, dated January 28, 1999, among The
Morgan Group, Inc. and Subsidiaries and Bank Boston, N.A., is incorporated
by reference to Exhibit 4(1) to The Morgan Group, Inc.'s Current Report on
Form 8-K filed February 12, 1999.
4.2 Guaranty, dated January 28, 1999, among The Morgan Group, Inc. and
Subsidiaries and BankBoston, N.A. is incorporated by reference to Exhibit
4(2) to The Morgan Group, Inc.'s Current Report on Form 8-K filed February
12, 1999.
4.3 Security Agreement, dated January 28, 1999, among The Morgan Group, Inc.
and Subsidiaries and BankBoston, N.A. is incorporated by reference to
Exhibit 4(3) to The Morgan Group, Inc.'s Current Report on Form 8-K filed
February 12, 1999.
4.4 Stock Pledge Agreement, dated January 28, 1999, among The Morgan Group,
Inc. and Subsidiaries and BankBoston, N.A. is incorporated by reference to
Exhibit 4(4) to The Morgan Group, Inc.'s Current Report on Form 8-K filed
February 12, 1999.
4.5 Revolving Credit Note, dated January 28, 1999, among The Morgan Group, Inc.
and Subsidiaries and BankBoston, N.A. is incorporated by reference to
Exhibit 4(5) to The Morgan Group, Inc.'s Current Report on Form 8-K filed
February 12,1999.
4.6 Amendment Agreement No. 1 to that Certain Revolving Credit Agreement and
Term Loan Agreement among The Morgan Group, Inc. and its Subsidiaries and
BankBoston dated as of March 31, 2000, is incorporated by reference to
Exhibit 4.9 to The Morgan Group, Inc.'s Annual Report on Form 10-K for the
year ended December 31, 2000.
4.7 Amendment Agreement No. 2 to that Certain Revolving Credit Agreement and
Term Loan Agreement among The Morgan Group, Inc. and its Subsidiaries and
BankBoston dated as of November 10, 2000, is incorporated by reference to
Exhibit 4.10 to The Morgan Group, Inc.'s Annual Report on Form 10-K for the
year ended December 31, 2000.
4.8 Form of Class A Warrant Certificate is incorporated by reference to Exhibit
4.11 of Amendment No. 1 to The Morgan Group, Inc.'s Registration Statement
on Form S-2, File No. 333-63188, filed August 15, 2001.
4.9 Form of Warrant Services Agreement between The Morgan Group, Inc. and
American Stock Transfer and Trust Company is incorporated by reference to
Exhibit 4.12 of Amendment No. 1 to The Morgan Group, Inc.'s Registration
Statement on Form S-2, File No. 333-63188, filed August 15, 2001.
4.10 Revolving Credit and Security Agreement, dated July 27, 2001, among GMAC
Commercial Credit LLC, Morgan Drive Away, Inc. and TDI, Inc., is
incorporated by reference to Exhibit 4.1 to The Morgan Group, Inc.'s
Quarterly Report on Form 10-Q for the period ended June 30, 2001, filed
August 14, 2001.
4.11 Guaranty, dated July 27, 2001, between The Morgan Group, Inc. and GMAC
Commercial Credit LLC, is incorporated by reference to Exhibit 4.2 to The
Morgan Group, Inc.'s Quarterly Report on Form 10-Q for the period ended
June 30, 2001, filed August 14, 2001.
4.12 Letter of Credit Financing Supplement to Revolving Credit Agreement, dated
July 27, 2001, among GMAC Commercial Credit LLC, Morgan Drive Away, Inc.,
and TDI, Inc., is incorporated by reference to Exhibit 4.2 to The Morgan
Group, Inc.'s Quarterly Report on Form 10-Q for the period ended September
30, 2001.
-17-
4.13 Amendment to that certain Revolving Credit and Security Agreement among
GMAC Commercial Credit, LLC, Morgan Drive Away, Inc., and TDI, Inc., dated
as of November 8, 2001, is incorporated by reference to Exhibit 4.1 to The
Morgan Group, Inc.'s Quarterly Report on Form 10-Q for the period ended
September 30, 2001.
4.14 Mortgage, dated July 31, 2001, between Morgan Drive Away, Inc. and Old Kent
Bank, is incorporated by reference to Exhibit 4.3 to The Morgan Group,
Inc.'s Quarterly Report on Form 10-Q for the period ended June 30, 2001,
filed August 14, 2001.
4.15 Guaranty, dated July 31, 2001, between The Morgan Group, Inc. and Old Kent
Bank, is incorporated by reference to Exhibit 4.4 to The Morgan Group,
Inc.'s Quarterly Report on Form 10-Q for the period ended June 30, 2001,
filed August 14, 2001.
10.1 Separation and Distribution Agreement, dated as of December ___, 2001 by
and among Lynch Interactive Corporation, Morgan Group Holding Co. and The
Morgan Group, Inc.*
10.2 The Morgan Group, Inc. Incentive Stock Plan is incorporated by reference to
Exhibit 10.1 to The Morgan Group, Inc.'s Registration Statement on Form
S-1, File No. 33-641-22, effective July 22, 1993.
10.3 First Amendment to The Morgan Group, Inc. Incentive Stock Plan is
incorporated by reference to Exhibit 10.1 to The Morgan Group, Inc.'s
Quarterly Report on Form 10-Q for the period ended September 30, 1997,
filed November 14, 1997.
10.4 Memorandum to Charles Baum and Philip Ringo from Lynch Corporation, dated
December 8, 1992, respecting Bonus Pool, is incorporated by reference to
Exhibit 10.2 to The Morgan Group, Inc.'s Registration Statement on Form
S-1, File No. 33-641-22, effective July 22, 1993.
10.5 Term Life Policy from Northwestern Mutual Life Insurance Company insuring
Paul D. Borghesani, dated August 1, 1991, is incorporated by reference to
Exhibit 10.4 to The Morgan Group, Inc.'s Registration Statement on Form
S-1, File No. 33-641-22, effective July 22, 1993.
10.6 Long Term Disability Insurance Policy from Northwestern Mutual Life
Insurance Company, dated March 1, 1990, is incorporated by reference to The
Morgan Group, Inc.'s Registration Statement on Form S-1, File No.
33-641-22, effective July 22, 1993.
10.7 Long Term Disability Insurance Policy from CNA Insurance Companies,
effective January 1, 1998 is incorporated by reference to Exhibit 10.6 to
The Morgan Group, Inc.'s Annual Report on Form 10-K for the year ended
December 31, 1997, filed March 31, 1998.
10.8 The Morgan Group, Inc. Employee Stock Purchase Plan, as amended, is
incorporated by reference to Exhibit 10.16 to The Morgan Group, Inc.'s
Annual Report on Form 10-K for the year ended December 31, 1994, filed on
March 30, 1995.
10.9 Consulting Agreement between Morgan Drive Away, Inc. and Paul D.
Borghesani, effective as of April 1, 1996, is incorporated by reference to
Exhibit 10.19 The Morgan Group, Inc.'s Annual Report on Form 10-K for the
year ended December 31, 1995, filed on April 1, 1996.
10.10Employment Agreement, dated January 12, 2000 between The Morgan Group,
Inc. and Anthony T. Castor, III is incorporated by reference to Exhibit
10.9 to The Morgan Group, Inc.'s Annual Report on Form 10-K for the year
ended December 31, 1999.
10.11Non-Qualified Stock Option Plan and Agreement, dated January 11, 2000,
between The Morgan Group, Inc. and Anthony T. Castor, III is incorporated
by reference to Exhibit 10.10 to The Morgan Group, Inc.'s Annual Report on
Form 10-K for the year ended December 31, 1999.
-18-
10.12Management Agreement between Skandia International and Risk Management
(Vermont), Inc. and Interstate Indemnity Company, dated December 15, 1992,
is incorporated by reference to Exhibit 10.12 to The Morgan Group, Inc.'s
Registration Statement on Form S-1, File No. 33-641-22, effective July 22,
1993.
10.13Agreement for the Allocation of Income Tax Liability between Lynch
Corporation and its Consolidated Subsidiaries, including The Morgan Group
(formerly Lynch Services Corporation), dated December 13, 1988, as amended,
is incorporated by reference to Exhibit 10.13 The Morgan Group, Inc.'s
Registration Statement on Form S-1, File No. 33-641-22, effective July 22,
1993.
10.14Certain Services Agreement, dated January 1, 1995, between Lynch
Corporation and The Morgan Group, Inc.*
- ---------------
* Incorporated by reference to the exhibits to the Company's Registration
Statement on Form S-1 (Registration No. 333-73996).
(b) Reports on Form 8-K filed in the fourth quarter of the period covered this
Report.
None.
(c) Exhibits.
See Item 15 (a)(3).
(d) Financial Statement Schedules.
None.
-19-
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities and
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
MORGAN GROUP HOLDING CO.
By: /s/ Robert E. Dolan
-------------------
ROBERT E. DOLAN
Chief Financial Officer
(Principal Financial and Accounting Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
Signature Capacity Date
/s/ Mario J. Gabelli Chief Executive Officer March 29, 2004
- -------------------- (Principal Executive Officer)
MARIO J. GABELLI and Director
/s/ Robert E. Dolan Chief Financial Officer March 29, 2004
- ------------------- (Principal Financial and Accounting
ROBERT E. DOLAN Officer and Director)
/s/ John Fikre Director March 29, 2004
- -------------------
JOHN FIKRE
-20-
EXHIBIT INDEX
3.1 Certificate of Incorporation of the Company*
3.2 By-laws of the Company*
4.1 Revolving Credit and Term Loan Agreement, dated January 28, 1999, among The
Morgan Group, Inc. and Subsidiaries and Bank Boston, N.A., is incorporated
by reference to Exhibit 4(1) to The Morgan Group, Inc.'s Current Report on
Form 8-K filed February 12, 1999.
4.2 Guaranty, dated January 28, 1999, among The Morgan Group, Inc. and
Subsidiaries and BankBoston, N.A. is incorporated by reference to Exhibit
4(2) to The Morgan Group, Inc.'s Current Report on Form 8-K filed February
12, 1999.
4.3 Security Agreement, dated January 28, 1999, among The Morgan Group, Inc.
and Subsidiaries and BankBoston, N.A. is incorporated by reference to
Exhibit 4(3) to The Morgan Group, Inc.'s Current Report on Form 8-K filed
February 12, 1999.
4.4 Stock Pledge Agreement, dated January 28, 1999, among The Morgan Group,
Inc. and Subsidiaries and BankBoston, N.A. is incorporated by reference to
Exhibit 4(4) to The Morgan Group, Inc.'s Current Report on Form 8-K filed
February 12, 1999.
4.5 Revolving Credit Note, dated January 28, 1999, among The Morgan Group, Inc.
and Subsidiaries and BankBoston, N.A. is incorporated by reference to
Exhibit 4(5) to The Morgan Group, Inc.'s Current Report on Form 8-K filed
February 12,1999.
4.6 Amendment Agreement No. 1 to that Certain Revolving Credit Agreement and
Term Loan Agreement among The Morgan Group, Inc. and its Subsidiaries and
BankBoston dated as of March 31, 2000, is incorporated by reference to
Exhibit 4.9 to The Morgan Group, Inc.'s Annual Report on Form 10-K for the
year ended December 31, 2000.
4.7 Amendment Agreement No. 2 to that Certain Revolving Credit Agreement and
Term Loan Agreement among The Morgan Group, Inc. and its Subsidiaries and
BankBoston dated as of November 10, 2000, is incorporated by reference to
Exhibit 4.10 to The Morgan Group, Inc.'s Annual Report on Form 10-K for the
year ended December 31, 2000.
4.8 Form of Class A Warrant Certificate is incorporated by reference to Exhibit
4.11 of Amendment No. 1 to The Morgan Group, Inc.'s Registration Statement
on Form S-2, File No. 333-63188, filed August 15, 2001.
4.9 Form of Warrant Services Agreement between The Morgan Group, Inc. and
American Stock Transfer and Trust Company is incorporated by reference to
Exhibit 4.12 of Amendment No. 1 to The Morgan Group, Inc.'s Registration
Statement on Form S-2, File No. 333-63188, filed August 15, 2001.
4.10 Revolving Credit and Security Agreement, dated July 27, 2001, among GMAC
Commercial Credit LLC, Morgan Drive Away, Inc. and TDI, Inc., is
incorporated by reference to Exhibit 4.1 to The Morgan Group, Inc.'s
Quarterly Report on Form 10-Q for the period ended June 30, 2001, filed
August 14, 2001.
4.11 Guaranty, dated July 27, 2001, between The Morgan Group, Inc. and GMAC
Commercial Credit LLC, is incorporated by reference to Exhibit 4.2 to The
Morgan Group, Inc.'s Quarterly Report on Form 10-Q for the period ended
June 30, 2001, filed August 14, 2001.
-21-
4.12 Letter of Credit Financing Supplement to Revolving Credit Agreement, dated
July 27, 2001, among GMAC Commercial Credit LLC, Morgan Drive Away, Inc.,
and TDI, Inc., is incorporated by reference to Exhibit 4.2 to The Morgan
Group, Inc.'s Quarterly Report on Form 10-Q for the period ended September
30, 2001.
4.13 Amendment to that certain Revolving Credit and Security Agreement among
GMAC Commercial Credit, LLC, Morgan Drive Away, Inc., and TDI, Inc., dated
as of November 8, 2001, is incorporated by reference to Exhibit 4.1 to The
Morgan Group, Inc.'s Quarterly Report on Form 10-Q for the period ended
September 30, 2001.
4.14 Mortgage, dated July 31, 2001, between Morgan Drive Away, Inc. and Old Kent
Bank, is incorporated by reference to Exhibit 4.3 to The Morgan Group,
Inc.'s Quarterly Report on Form 10-Q for the period ended June 30, 2001,
filed August 14, 2001.
4.15 Guaranty, dated July 31, 2001, between The Morgan Group, Inc. and Old Kent
Bank, is incorporated by reference to Exhibit 4.4 to The Morgan Group,
Inc.'s Quarterly Report on Form 10-Q for the period ended June 30, 2001,
filed August 14, 2001.
10.1 Separation and Distribution Agreement, dated as of December ___, 2001 by
and among Lynch Interactive Corporation, Morgan Group Holding Co. and The
Morgan Group, Inc.*
10.2 The Morgan Group, Inc. Incentive Stock Plan is incorporated by reference to
Exhibit 10.1 to The Morgan Group, Inc.'s Registration Statement on Form
S-1, File No. 33-641-22, effective July 22, 1993.
10.3 First Amendment to The Morgan Group, Inc. Incentive Stock Plan is
incorporated by reference to Exhibit 10.1 to The Morgan Group, Inc.'s
Quarterly Report on Form 10-Q for the period ended September 30, 1997,
filed November 14, 1997.
10.4 Memorandum to Charles Baum and Philip Ringo from Lynch Corporation, dated
December 8, 1992, respecting Bonus Pool, is incorporated by reference to
Exhibit 10.2 to The Morgan Group, Inc.'s Registration Statement on Form
S-1, File No. 33-641-22, effective July 22, 1993.
10.5 Term Life Policy from Northwestern Mutual Life Insurance Company insuring
Paul D. Borghesani, dated August 1, 1991, is incorporated by reference to
Exhibit 10.4 to The Morgan Group, Inc.'s Registration Statement on Form
S-1, File No. 33-641-22, effective July 22, 1993.
10.6 Long Term Disability Insurance Policy from Northwestern Mutual Life
Insurance Company, dated March 1, 1990, is incorporated by reference to The
Morgan Group, Inc.'s Registration Statement on Form S-1, File No.
33-641-22, effective July 22, 1993.
10.7 Long Term Disability Insurance Policy from CNA Insurance Companies,
effective January 1, 1998 is incorporated by reference to Exhibit 10.6 to
The Morgan Group, Inc.'s Annual Report on Form 10-K for the year ended
December 31, 1997, filed March 31, 1998.
10.8 The Morgan Group, Inc. Employee Stock Purchase Plan, as amended, is
incorporated by reference to Exhibit 10.16 to The Morgan Group, Inc.'s
Annual Report on Form 10-K for the year ended December 31, 1994, filed on
March 30, 1995.
10.9 Consulting Agreement between Morgan Drive Away, Inc. and Paul D.
Borghesani, effective as of April 1, 1996, is incorporated by reference to
Exhibit 10.19 The Morgan Group, Inc.'s Annual Report on Form 10-K for the
year ended December 31, 1995, filed on April 1, 1996.
10.10Employment Agreement, dated January 12, 2000 between The Morgan Group,
Inc. and Anthony T. Castor, III is incorporated by reference to Exhibit
10.9 to The Morgan Group, Inc.'s Annual Report on Form 10-K for the year
ended December 31, 1999.
-22-
10.11Non-Qualified Stock Option Plan and Agreement, dated January 11, 2000,
between The Morgan Group, Inc. and Anthony T. Castor, III is incorporated
by reference to Exhibit 10.10 to The Morgan Group, Inc.'s Annual Report on
Form 10-K for the year ended December 31, 1999.
10.12Management Agreement between Skandia International and Risk Management
(Vermont), Inc. and Interstate Indemnity Company, dated December 15, 1992,
is incorporated by reference to Exhibit 10.12 to The Morgan Group, Inc.'s
Registration Statement on Form S-1, File No. 33-641-22, effective July 22,
1993.
10.13Agreement for the Allocation of Income Tax Liability between Lynch
Corporation and its Consolidated Subsidiaries, including The Morgan Group
(formerly Lynch Services Corporation), dated December 13, 1988, as amended,
is incorporated by reference to Exhibit 10.13 The Morgan Group, Inc.'s
Registration Statement on Form S-1, File No. 33-641-22, effective July 22,
1993.
10.15Certain Services Agreement, dated January 1, 1995, between Lynch
Corporation and The Morgan Group, Inc.*
- -----------------
* Incorporated by reference to the exhibits to the Company's Registration
Statement on Form S-1 (Registration No. 333-73996).
The Exhibits listed above have been filed separately with the Securities and
Exchange Commission in conjunction with this Annual Report on Form 10-K or have
been incorporated by reference into this Annual Report on Form 10-K. Morgan
Group Holding Co. will furnish to each of its shareholders a copy of any such
Exhibit for a fee equal to Morgan Group Holding Co.'s cost in furnishing such
Exhibit. Requests should be addressed to the Office of the Secretary, Morgan
Group Holding Co., 401 Theodore Fremd Avenue, Rye, New York 10580.
-23-