<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549
                                    FORM 10-K

(Mark One)

  X  Annual report pursuant to Section 13 or 15(d) of the Securities Exchange
-----
Act of 1934

For the fiscal year ended December 31, 2001 or
                          -----------------

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

For the transition period from_______________________to_________________________
Commission file number               1-5654
                      ---------------------------------------

                                     EXX INC
--------------------------------------------------------------------------------
                  (Exact Name of Registrant as in its Charter)

Nevada                                               88-0325271
-------------------------                  ----------------------------------
(State or Other Jurisdiction of           (I.R.S. Employer Identification No.)
Incorporation or Organization)

1350 East Flamingo Road, Suite 689
Las Vegas, Nevada                                            89119-5263
------------------------------                           -----------------
(Address of Principal Executive Offices)                    (Zip Code)

                                  702-598-3223
--------------------------------------------------------------------------------
              (Registrant's Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

                                                       Name of Each Exchange
         Title of each class                           on Which Registered
         -------------------                           -------------------

Common Stock Par Value $.01 Class A                      American Stock Exchange
-----------------------------------------            ---------------------------

Common Stock Par Value $.01 Class B                      American Stock Exchange
-----------------------------------------            ---------------------------

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 Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes  X   No ____ Indicate by check
                                              ---
mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K
is not contained herein, and will not be contained, to the best of registrant's
knowledge, in definitive proxy or information statements incorporated by
reference on Part III of this Form 10-K or any amendment to this Form 10-K. [X]

Number of shares of Common Stock, Par Value $.01 per share, outstanding as of
December 31, 2001: 10,832,007 Class A shares and 617,853 Class B shares
(exclusive of 1,229,600 Class A shares and 7100 Class B shares held in
registrant's treasury). Of the shares outstanding, 4,855,025 Class A shares and
303,275 Class B shares are held by non-affiliates. The market value of the
shares held by non-affiliates is $2,718,525 based on $.45 and $1.76 per share,
respectively of the closing price of the registrant's Class A and Class B common
stock on the American Stock Exchange on March 15, 2002.

Documents incorporated by reference are: Registrant's Proxy Statement dated
April, 2002 for the Annual Meeting of Stockholders to be held in May, 2002, Form
8-K Report dated February 17, 1997, Form 8-K Report dated October 29, 1999, Form
8-K Report dated February 15, 2001, Form 8-K Report dated August 6, 2001, and
Form 10-K Report for the year ended December 31, 1997 dated March 31, 1998, Form
10-K Report for the year ended December 31, 1999 dated March 29, 2000, Form 10-K
Report for the year ended December 31, 2000 dated March 29, 2001, Form S-4
Registration Statement dated July 25, 1994 and Form S-4 Amendment No. 1 dated
August 16, 1994.

<PAGE>

                                     PART 1
                                     ------

Item 1.  Business.
-----------------

     EXX INC ("EXX") is the holding Company resulting from the Reorganization of
SFM Corporation ("SFM") as approved by its shareholders at a special meeting on
October 18, 1994 and effective on October 21, 1994. The purpose of adopting a
holding company structure was to enhance the Company's ability to obtain new
financing by enabling potential investors to clearly focus on the strengths and
diversity of EXX's businesses and to protect each of EXX's businesses to the
extent possible from the business risks which arise out of its other businesses.

     As part of the Reorganization each outstanding share of SFM Common stock
was converted into three shares of EXX Class A Common Stock and one share of EXX
Class B Common Stock. The new stock is substantially identical to the old stock
in rights and privileges except that holders of outstanding shares of Class B
Common Stock have the right to elect two-thirds or the next rounded number of
directors in excess of two-thirds if the number of Directors is not divisible by
three, and the holders of outstanding shares of the Class A Common Stock have
the right to elect the remaining directors of the Company.

     Under the Reorganization SFM became a wholly-owned subsidiary of EXX and
each of SFM's wholly-owned subsidiaries became wholly-owned subsidiaries of EXX
with each subsidiary retaining its assets and liabilities and continuing its
business. In order to effect the transactions, SFM distributed as a dividend to
EXX all the outstanding stock of each of its subsidiaries as well as SFM's cash,
cash equivalents and certain promissory notes.

     In March 2000, the Company paid a 400% stock dividend which provided for a
dividend of four shares of Class A stock for each share of Class A and/or Class
B common stock held. All transactions and disclosures in the consolidated
financial statements relating to the Company's Class A and Class B common stock
have been restated to reflect this dividend.

     EXX, through its subsidiaries, is engaged in the design, production and
sale of electric motors geared toward the (OEM) original equipment market, and
the design, production and sale of cable pressurization equipment sold to the
telecommunications industry. SFM manufactured machine tools and machine tool
replacement parts. EXX has a continuing right to royalty income from machine
tools and replacement parts as part payment for its sale of a subsidiary's
assets. Continuing operations are conducted through wholly-owned subsidiaries.
In addition, it is engaged in the design, production and sale of consumer goods
in the form of impulse and other toys and kites.

     The Howell Electric Motors Division ("Howell") of SFM is engaged in the
assembly and sale of alternating current, fractional and small integral motors
ranging from 1/4 to 10 horsepower. Howell's product line consists of such
specialty items as blower motors designed for use in air conditioning systems,
flat-type motors used in floor scrubbing and polishing machines, and motor pump
assemblies used in food machinery products and a variety of other applications.
In recent years, a substantial portion of Howell's sales have been to the floor
care service industry and the food machinery industry, and have been effected
through Howell's own marketing personnel and several independent sales
representatives working on a commission basis.

     The principal raw materials used by Howell are steel, copper, aluminum and
grey-iron or aluminum casting, all of which are purchased from various suppliers
on a competitive basis. During the period covered by this report, Howell
experienced no significant difficulty in obtaining these raw materials, and,
barring some presently unforeseen event, Howell does not expect to encounter any
difficulties in obtaining such supplies during the current year.

                                       2

<PAGE>

     Raw material inventories for Howell are maintained largely for known
requirements, i.e., they are held for firm orders, or, in the case of certain
items with a variety of applications to Howell's products, are held for
anticipated orders. Inventories of finished goods consist predominately of
products ready for shipment. Howell believes that its practices relating to all
working capital items, including its inventory practices, do not materially
differ from those used by other companies in similar endeavors and comparable in
size to Howell.

     Howell is in a highly competitive business, and believes that it is not a
very significant factor in the industry. It competes with many other companies
which have significantly greater assets and resources.

     In April 1994, TX Systems Inc., a newly formed subsidiary of EXX, acquired
the operating assets and businesses of TX Technologies, Inc. and TX Software,
Inc. These companies were engaged in the Cable Pressurization and Monitoring
Systems business. The TX Systems Inc. acquisition together with the activities
of another newly formed subsidiary - TX Technology Corp. - broadened our
activities in the capital goods segment, allowing us entry to the
telecommunications industry. The TX Companies operate the cable pressurization
and monitoring system business.

     The business provides means to prevent telecommunications signal reductions
through use of cable pressurization equipment and equipment to
monitor cable pressure, as well as equipment to report the results of the
monitoring over telephone lines.

     Henry Gordy International, Inc. ("Gordy") was formed during the third
quarter of 1987 to conduct the business associated with certain assets purchased
from Henry Gordy, Inc. and Gordy International, Inc.

     Gordy markets a line of "impulse" toys through a national network of
commissioned sales representatives, together with its own sales staff. Its
products are distributed directly or through wholesalers to a wide range of
retail outlets including, but not limited to, toy stores, department stores,
discount chains, drug stores and supermarkets.

     Gordy's sales are derived from products manufactured to its specifications.
In prior years, some of the products covered by the Power Ranger license caused
sales to materially increase due to strong consumer demand. During the past
several years, there were no licenses that individually had a material effect on
sales. There are currently no significant licenses that are material to the Toy
line.

     The majority of the merchandise is manufactured in the Far East to Gordy's
specifications and shipped as required. No difficulties have been encountered in
obtaining sources for the products, nor are any expected for the current year.

     Inventories are maintained for anticipated orders. Gordy believes that its
practices relating to all working capital items, including its inventory
practices, do not materially differ from those used by other companies in
similar endeavors and comparable in size to Gordy.

     Gordy operates in a highly competitive market. It competes with many other
companies, some of which have substantially greater resources and assets than
Gordy. A substantial portion of toy sales are dependent on a contractual basis
which are subject to re-negotiation at various times. The non-renewal of
contractual sales would have a material adverse effect on the toy segment of the
business.

                                       3

<PAGE>

     In February 1994, Hi-Flier Inc., a newly formed subsidiary of EXX,
purchased the assets of Hi-Flier Manufacturing Co., a leader in the kite
business for more than seventy years. This acquisition strengthened the
Company's toy segment by providing product lines that compliment those of the
Henry Gordy International Inc. subsidiary.

     In February 1997, the Company (through a newly-formed subsidiary) acquired
all the outstanding capital stock of Handi Pac, Inc., d/b/a Steven Manufacturing
Co. (Handi Pac). Handi Pac manufactures and sells several types of toys,
including pre-school, ride-on, classic and educational toys. In addition during
the third quarter 1997, a wholly-owned subsidiary acquired the assets of
Confectionery and Novelty Design International, LLC ("CANDI"), a Northbrook, IL
maker of candy-filled toy products. While this acquisition was not a material
purchase, it adds a complimentary product to the business mix.

     Material Customers.
     ------------------

     Net sales to one customer were approximately 33% and 25% for the years
ended December 31, 2001 and 2000, respectively.

     Employees.
     ---------

     The registrant employs approximately 120 full-time employees, of whom
approximately 93 are employed by the Mechanical Equipment group, 26 by the Toy
Segment and 1 for all other activities of the registrant combined.

                                       4

<PAGE>

Item 2.  Properties.
-------------------

     SFM Corp., the registrant's wholly-owned subsidiary, owns a brick and
masonry building in Plainfield, New Jersey containing approximately 120,000
square feet of manufacturing area and 10,000 square feet of office space, where
the operations of Howell and Gordy are located.

     The registrant, through a subsidiary, currently leases 11,000 square feet
of warehousing and office space in Randolph, New Jersey for its
telecommunication operations. Also, the registrant through its Handi Pac
subsidiary leases a 90,000 square foot facility in Hermann, Missouri under a
capital lease arrangement with an option to purchase. In addition, the
registrant leases office space in Las Vegas, Nevada.

     The registrant considers its facilities and the equipment contained therein
adequate and suitable to meet its current and foreseeable requirements.

Item 3.  Legal Proceedings.
--------------------------

     None other than in the normal course of business.

                                     PART II

Item 4.  Market for the Registrant's Common Stock and Related Security Holder
-----------------------------------------------------------------------------
Matters.
-------

         Principal Market:  American Stock Exchange
         ------------------------------------------

         Quarterly Price Information
         ---------------------------

<TABLE>
<CAPTION>
                                  2001                            2000
                    -------------------------------  -------------------------------

                        Class A          Class B          Class A         Class B
                    -------------    ------------      ------------   --------------
                    High      Low    High     Low      High     Low   High       Low
                    ----      ---    ----     ---      ----     ---   ----       ---
<S>                 <C>       <C>   <C>      <C>    <C>     <C>   <C>      <C>
First Quarter       1.00      .56    2.23     .88      2.25     .95    2.94      .95
Second Quarter       .70      .56    1.76    1.40      1.19     .63    1.88     1.25
Third Quarter        .65      .48    1.46    1.30      1.06     .63    1.94     1.38
Fourth Quarter       .67      .44    1.60    1.05       .81     .56    1.50      .88
</TABLE>

                Stockholders: As of March 15, 2002, it is estimated that there
                ------------
were approximately 1100 stockholders of record of Class A shares and 350
stockholders of record of Class B shares.

                                       5

<PAGE>

          Dividend Information: No cash dividends were paid in 2001 or 2000.
          --------------------

          There is no present restriction on the registrant's ability to pay
cash dividends. The registrant deems the use of corporate funds for day to day
needs to be in the best interest of the registrant. There is no present
intention to make any cash dividend payments.

Item 5.  Selected Financial Data.
--------------------------------

<TABLE>
<CAPTION>
Sales and Income                                2001            2000 (A)            1999 (A)            1998               1997
----------------                                ----            --------            --------            ----               ----
<S>                                         <C>                <C>                <C>                <C>                <C>
Net sales                                   $18,382,000        $19,163,000        $21,158,000        $20,935,000        $22,324,000
Net Income (loss)                                81,000          1,074,000          2,445,000            761,000           (223,000)


Per Share Data (B)
--------------
   Net income (loss)-Basic                  $       .01        $       .09        $       .12        $       .06        $      (.02)
   Net income (loss)-Diluted                        .01                .08                .12                .06               (.02)
   Book value                                       .97                .93                .80                .72                .66


Financial Position
------------------
  Current assets                            $15,181,000        $15,269,000        $13,886,000        $13,776,000        $13,291,000
  Total Assets                               17,464,000         17,688,000         16,786,000         16,440,000         16,181,000

  Current liabilities                         3,851,000          3,720,000          4,047,000          4,667,000          5,152,000

  Current ratio                                3.9 to 1           4.1 to 1           3.4 to 1           3.0 to 1           2.6 to 1

  Working capital                           $11,300,000        $11,549,000         $9,839,000         $9,109,000         $8,139,000
  Property and
   equipment, net                             1,801,000          2,025,000          2,325,000          2,386,000          2,586,000
  Long-term debt                              1,621,000          1,690,000          1,747,000          1,794,000          1,886,000
  Stockholders' equity                       11,050,000         11,427,000         10,207,000          9,281,000          8,918,000
</TABLE>

(A)  Restated to reflect change in reporting entity. (See Note 4 to the
     Consolidated Financial Statements)

(B)  As adjusted for a 400% stock dividend effective March 8, 2000, Class A and
     Class B shares retroactively shown.

                                       6

<PAGE>

Item 6.  Management's Discussion and Analysis of Financial Condition and Results
--------------------------------------------------------------------------------
of Operations.
--------------

        The following management's discussion and analysis of results of
operations and financial condition 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 EXX INC 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 EXX INC's actual results and
corporate developments to differ materially from those expected. Factors that
could cause results and developments to differ materially from EXX INC'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.

        During 2001, the Company increased its investment in Newcor, Inc. to
approximately 31%, thereby requiring the Company to use the equity method of
accounting. The following management's discussion gives retroactive effect to
the adoption of the equity method which is considered a change in reporting
entity for the calendar years 2000 and 1999. Please see Note 4 to the
Consolidated Financial Statements which further discusses this change.

2001 Compared to 2000
---------------------

        Net sales in 2001 were $18,382,000 compared to $19,163,000 which was a
decrease of $781,000. This year's sales represent a 4% decrease from the prior
year sales. The Mechanical Equipment Group had total sales of $10,910,000 in
2001 compared to $11,915,000 in 2000, a decrease of $1,005,000. The current year
sales represent an 8% decrease from the prior year sales. The Toy Segment's
sales were $7,472,000 compared to $7,248,000 in 2000, an increase of $224,000.
The current year's sales represent a 3% increase from the prior year sales.

        Gross profit was $6,818,000 compared to last year's $7,339,000, a
decrease of $521,000. The Mechanical Equipment Group accounted for a $401,000
decrease in gross profit while the Toy Segment accounted for the difference.
Gross profit as a percentage of sales decreased to 37% compared to last year's
38% primarily due to the reduction in sales and the related gross profit
percentage earned by the Mechanical Equipment Group.

        Selling and G&A expenses were $4,439,000, a decrease of $773,000 from
$5,212,000 in 2000.

        The operating income of $2,379,000 represented an increase in income of
$252,000 from the prior year's operating income of $2,127,000. The Mechanical
Equipment Group generated operating income of $1,985,000, a decrease of $212,000
from an operating income of $2,197,000 in 2000 while the Toy Segment's operating
income of $1,011,000 represented an increase of $279,000 from an operating
income of $732,000 in 2000 Corporate and other operating expenses decreased to
$617,000 from $802,000 last year.

        Interest expense was $140,000 in 2001 compared to $112,000 in 2000.

        The Company generated net income of $81,000 or $.01 per A & B share
compared to a net income of $1,074,000 or $.09 per A & B share in 2000. The
equity in losses of Newcor, Inc. in 2001 was $1,679,000 compared to $598,000 in
2000.

                                       7

<PAGE>

        The Company reported a deferred tax asset of $520,000 at December 31,
2001. Management believes this asset will be realized by taxable earnings in the
future.

        The Mechanical Equipment Group operations in 2001 reflect the downturn
of the economy. Competition remained intense for the reduced amount of available
sales. Management's goals have remained consistent during the year in attempting
to maintain a highly competitive market share and new product acceptance in
spite of the adverse economic conditions.

        The Toy segment remains in a lackluster market. Industry attempts to
introduce what are perceived to be hot new items have on an overall basis been
unsuccessful. New meaningful licenses have not surfaced. The same challenges
indicated in the past affect the industry namely product, labor and marketing
costs. The strength of the US dollar in purchasing product overseas, has had
little effect in reducing costs. While the Toy segment operations this past year
showed a small improvement, management believes the results are not of a trend
but of customers balancing their inventory levels. Management continues to seek,
review and test new items that fall within its pricing structure in a highly
competitive marketing area.

                                       8

<PAGE>

2000 Compared to 1999
---------------------

        Net sales in 2000 were $19,163,000 compared to $21,158,000 which was a
decrease of $1,995,000. This year's sales represented a 9% decrease from the
prior year sales. The Mechanical Equipment Group had total sales of $11,915,000
in 2000 compared to $13,866,000 in 1999, a decrease of $1,951,000. The 2000 year
sales represented a 14% decrease from the prior year sales. The Toy Segment's
sales were $7,248,000 compared to $7,292,000 in 1999, a decrease of $44,000. The
2000 year sales represented a 1% decrease from the prior year sales.

        Gross profit was $7,339,000 compared to last year's $8,455,000, a
decrease of $1,116,000. The Mechanical Equipment Group accounted for a
$1,533,000 decrease in gross profit while the Toy Segment accounted for the
counterbalancing difference. Gross profit as a percentage of sales decreased to
39% compared to last year's 40% primarily due to the reduction in sales and the
related gross profit percentage earned by the Mechanical Equipment Group.

        Selling and G&A expenses were $5,212,000, an increase of $165,000 from
$5,047,000 in 1999.

        The operating income of $2,127,000 represented a decrease in income of
$1,281,000 from the prior year's operating income of $3,408,000. The Mechanical
Equipment Group generated operating income of $2,197,000, a decrease of
$1,265,000 from an operating income of $3,462,000 in 1999 while the Toy
Segment's operating income of $732,000 represented an increase of $145,000 from
an operating income of $587,000 in 1999 Corporate and other operating expenses
increased to $802,000 from $641,000 last year.

        Interest expense remained the same in 2000 and 1999 at $112,000.

        The Company generated net income of $1,074,000 or $.09 per A & B share
compared to a net income of $1,582,000 or $.12 per A & B share in 1999. The
equity in losses of Newcor, Inc. was $598,000 in 2000 compared to $863,000 in
1999.

        The Company reported a net deferred tax asset of $409,000 at December
31, 2000. Management believes this asset will be realized by taxable earnings in
the future.

        The Mechanical Equipment Group operations in 2000 reflected more normal
results in the Telecommunications area. In 1999, this segment was the
beneficiary of the Y2K phenomenon which resulted in increased sales and profits.
Management's goals continue to be to maintain a highly competitive market share,
and new product acceptance in a continuing limited market areas.

        The Toy segment finished the year 2000 in much the same condition as the
prior year. The industry has not produced new meaningful licenses nor provided
the toy companies with new products to capture additional portions of the
market. The large companies are faced with the same challenges as the smaller
companies. These challenges as indicated in prior comments relate to competition
and increasing product, labor and marketing costs. Management continues to be
watchful over all aspects of the business, with its continuing goal of reviewing
and adjusting to customer demands and product mix. In addition, it is constantly
striving to seek and test new items that fall within the competitive range of
its market area.

                                       9

<PAGE>

Liquidity and Sources of Capital
--------------------------------

        During 2001, the Company generated $3,517,000 of cash flows from
operating activities compared to $2,236,000 in 2000.

        In 2001, the Company's investing activities used cash of $1,103,000
compared to providing cash totaling $3,566,000 in 2000. Cash was used primarily
to purchase long-term investments in 2001, while cash was provided primarily
from the proceeds from maturities of short term investments in 2000.

        During 2001 and 2000, the Company's financing activities used cash of
$564,000 and $345,000, respectively. In 2001, the Company purchased $495,000 of
Treasury Stock and made payments on notes totaling $69,000. In 2000, the Company
purchased $288,000 of Treasury Stock and made payments on notes totaling
$57,000.

        At the end of 2001, the Company had working capital of approximately
$11,300,000 and a current ratio of 3.9 to 1. At the end of 2000, the Company had
working capital of $11,549,000 and a current ration of 4.1 to 1. During the year
2001, the Registrant maintained a limited credit facility with a bank for two
subsidiaries which included a $300,000 sub-limit for direct borrowings and a
$150,000 sub-limit for documentary letters of credit all secured by certain of
the Registrant's money market funds. The Company considers this line and its
cash and cash equivalents of $9,622,000 to be adequate for its current operating
needs.

        The Company has no present plans that will require material capital
expenditures for any of the Company's businesses. Capital expenditures are
expected to be in the ordinary course of business and financed by cash generated
from operations.

        The Company believes the effects of inflation will not have a material
effect on its future operations.

Item 7.   Financial Statements
------------------------------

        The financial statements required by this item may be found beginning
with the index page on page F-1 immediately following the signature page.

Item 8.   Changes in and Disagreements with Accountants on Accounting and
-------------------------------------------------------------------------
           Financial Disclosure.
           ---------------------

         None

                                       10

<PAGE>

                                    PART III
                                    --------

          In accordance with General Instruction G to Form 10-K, Items 10
through 13, identified below, have been omitted form this report. The
information required in those sections, to the extent applicable, has been
included in the registrant's Proxy Statement for the current year, which will be
filed with the Securities and Exchange Commission within 120 days after December
31, 2001. The Proxy Statement is herein incorporated by reference.

Item  9.  Directors and Executive Officers of the Registrant.
------------------------------------------------------------

Item 10.  Executive Compensation.
--------------------------------

Item 11.  Security Ownership of Certain Beneficial Owners and Management.
------------------------------------------------------------------------

Item 12.  Certain Relationships and Related Transactions.
--------------------------------------------------------


                                     PART IV
                                     -------

Item 13. Exhibits, Schedules to Financial Statements and Reports
----------------------------------------------------------------
          on Form 8-K.
          -----------

     (a)  1.    Financial Statements
                --------------------

                Independent Auditors' Report
                Consolidated Balance Sheets
                Consolidated Statements of Operations
                Consolidated Statements of Changes in Stockholders' Equity
                Consolidated Statements of Cash Flows

          2.    Schedules to Financial Statements
                ---------------------------------

                II - Valuation and Qualifying Accounts

          3.    Exhibits
                --------

                Exhibit No. Description
                -----------------------

                 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)

                10.1       Amendment dated March 27, 1998 to Employment
                           Agreement with Davd A. Segal                      (3)

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

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

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

                                       11

<PAGE>

     (b)   Reports on Form 8-K
           -------------------

           None

     (c)   See Item (a)3. above

     (d)   Not applicable

                                   SIGNATURES
                                   ----------

          Pursuant to the requirements of Section 13 or 15(d) 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

By:   /s/ DAVID A. SEGAL
      ---------------------------------------------
      David A. Segal, Chairman of the Board

Date: March 28, 2002
      ---------------------------------------------------------


          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.

By:   /s/ JERRY FISHMAN
      ---------------------------------------------
      Jerry Fishman, Director

Date: March 28, 2002
      ---------------------------------------------



By:   /s/ NORMAN H. PERLMUTTER
      ---------------------------------------------
      Norman H. Perlmutter, Director

Date: March 28, 2002
      ---------------------------------------------


By:   /s/ FREDERIC REMINGTON
      ---------------------------------------------
      Frederic Remington, Director

Date: March 28, 2002
      ---------------------------------------------


By:   /s/ DAVID A. SEGAL
      ---------------------------------------------
      David A. Segal, Chief Executive Officer
      Chief Financial Officer
      Chairman of the Board

Date: March 28, 2002
      ---------------------------------------------

                                       12

<PAGE>

EXX INC AND SUBSIDIARIES

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULE
(ITEMS 8 AND 14 (a))

================================================================================

(1) Financial Statements

    Independent Auditors' Report                                             F-2

    Consolidated Financial Statements

     Balance Sheets
     December 31, 2001 and 2000                                              F-3

     Statements of Operations
     Years Ended December 31, 2001, 2000 and 1999                            F-4

     Statements of Changes in Stockholders' Equity
     Years Ended December 31, 2001, 2000 and 1999                            F-5

     Statements of Cash Flows
     Years Ended December 31, 2001, 2000 and 1999                        F-6 - 7

     Notes to Consolidated Financial Statements                          F-8 -23

(2) Financial Statement Schedule
      II - Valuation and Qualifying Accounts                                 S-1


OTHER SCHEDULES ARE OMITTED BECAUSE OF THE ABSENCE OF CONDITIONS UNDER WHICH
THEY ARE REQUIRED OR BECAUSE THE REQUIRED INFORMATION IS GIVEN IN THE
CONSOLIDATED FINANCIAL STATEMENTS OR NOTES THERETO.

                                                                             F-1

<PAGE>

INDEPENDENT AUDITORS' REPORT


To the Board of Directors and Stockholders of
EXX INC


We have audited the accompanying consolidated balance sheets of EXX INC and
Subsidiaries as of December 31, 2001 and 2000, and the related consolidated
statements of operations, changes in stockholders' equity, cash flows and
financial statement schedule for each of the three years in the period ended
December 31, 2001. These financial statements and financial statement schedule
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these consolidated financial statements and financial
statement schedule based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the consolidated
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of EXX INC and
Subsidiaries as of December 31, 2001 and 2000, and the results of their
operations and their cash flows for each of the three years in the period ended
December 31, 2001, in conformity with accounting principles generally accepted
in the United States of America. Also in our opinion, the consolidated financial
statement schedule referred to above, when considered in relation to the basic
consolidated financial statements taken as a whole, presents fairly, in all
material respects, the information required to be included therein.



                                             /s/ ROTHSTEIN, KASS & COMPANY, P.C.






Roseland, New Jersey
February 1, 2002





                                                                             F-2

<PAGE>

EXX INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

================================================================================

<TABLE>
<CAPTION>
December 31,                                                           2001           2000
----------------------------------------------------------------------------------------------
<S>                                                               <C>             <C>
ASSETS

Current assets
  Cash and cash equivalents                                       $  9,622,000    $  7,772,000
  Short-term investments                                                               599,000
  Accounts receivable, less allowances of
   $91,000 and $88,000 in 2001 and 2000, respectively                2,152,000       2,863,000
  Inventories                                                        2,620,000       2,995,000
  Other current assets                                                 246,000         356,000
  Refundable income taxes                                               21,000         152,000
  Deferred tax asset                                                   520,000         532,000
                                                                  ----------------------------

     Total current assets                                           15,181,000      15,269,000

Property and equipment, net                                          1,801,000       2,025,000

Other assets                                                           482,000         394,000
                                                                  ----------------------------

                                                                  $ 17,464,000    $ 17,688,000
                                                                  ============================

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities
  Long-term debt, current portion                                 $     66,000    $     63,000
  Accounts payable and other current liabilities                     3,815,000       3,657,000
                                                                  ----------------------------

     Total current liabilities                                       3,881,000       3,720,000
                                                                  ----------------------------

Long-term liabilities
  Long-term debt, less current portion                               1,555,000       1,627,000
  Pension liability                                                    416,000         473,000
  Deferred tax liability                                               562,000         441,000
                                                                  ----------------------------

                                                                     2,533,000       2,541,000
                                                                  ----------------------------

Commitments and contingencies

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                                            121,000         121,000
  Common stock, Class B, $.01 par value
   authorized 1,000,000 shares,
   issued 624,953 shares                                                 6,000           6,000
  Capital in excess of par value                                     2,670,000       2,670,000
  Accumulated other comprehensive loss                                (275,000)       (312,000)
  Retained earnings                                                  9,311,000       9,230,000
  Less treasury stock, 1,229,600  and 403,800 shares of Class A
   common stock and 7,100 and 6,300 shares of Class B
   common stock, at cost, in 2001 and 2000, respectively              (783,000)       (288,000)
                                                                  ----------------------------
     Total stockholders' equity                                     11,050,000      11,427,000
                                                                  ----------------------------

                                                                  $ 17,464,000    $ 17,688,000
                                                                  ============================
</TABLE>


See notes to consolidated financial statements.                F-3

<PAGE>

EXX INC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

================================================================================

<TABLE>
<CAPTION>
Years Ended December 31,                             2001              2000               1999
-------------------------------------------------------------------------------------------------
<S>                                            <C>                <C>                <C>
Net sales                                      $  18,382,000      $ 19,163,000       $ 21,158,000

Cost of sales                                     11,564,000        11,824,000         12,703,000
                                               --------------------------------------------------

Gross profit                                       6,818,000         7,339,000          8,455,000

Selling, general and
 administrative expenses                           4,439,000         5,212,000          5,047,000
                                               --------------------------------------------------

Operating income                                   2,379,000         2,127,000          3,408,000

Interest expense                                    (140,000)         (112,000)          (112,000)

Interest income                                      366,000           469,000            283,000

Other income                                          68,000            43,000             94,000

Equity in losses of Newcor, Inc.                  (1,679,000)         (598,000)          (863,000)
                                               --------------------------------------------------

Income before income taxes                           994,000         1,929,000          2,810,000

Income taxes                                         913,000           855,000          1,228,000
                                               --------------------------------------------------

Net income                                     $      81,000      $  1,074,000       $  1,582,000
                                               ==================================================

Net income per common share
 Basic                                         $        0.01      $       0.09       $       0.12
                                               ==================================================

 Diluted                                       $        0.01      $       0.08       $       0.12
                                               ==================================================

Weighted average shares outstanding
 Basic                                            11,939,000        12,616,000         12,749,000
                                               ==================================================

 Diluted                                          11,994,000        13,052,000         13,221,000
                                               ==================================================
</TABLE>

See notes to consolidated financial statements.

                                                                             F-4

<PAGE>

EXX INC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY


================================================================================
Years Ended December 31, 2001 and 1999
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                                                             Accumulated
                                                                                                                Other
                                                                      Capital in        Comprehensive       Comprehensive
                                            Common Stock              Excess of            Income              Income
                                       Class A       Class B          Par Value            (Loss)              (Loss)
<S>                                  <C>           <C>             <C>                <C>                   <C>
Balances,
 January 1, 1999                     $    177,000  $       9,000   $      3,844,000                         $    (206,000)

Purchase of treasury stock

Net income                                                                            $      1,582,000

Other comprehensive income,
 net of tax effect

    Minimum pension liability
     adjustment                                                                               (100,000)(a)       (100,000)
    Net unrealized loss on
     marketable securities                                                                    (440,000)(b)       (440,000)
                                                                                      -----------------

Total comprehensive income                                                            $      1,042,000
                                    ------------------------------------------------  =================     ---------------

Balances,
 December 31, 1999                        177,000          9,000          3,844,000                              (746,000)

Purchase of treasury stock

Retirement of treasury stock              (56,000)        (3,000)        (1,174,000)

Net income                                                                            $      1,074,000

Other comprehensive income,
 net of tax effect

    Minimum pension liability
     adjustment                                                                                 68,000 (a)         68,000
    Net unrealized gain on
     marketable securities                                                                     366,000 (b)        366,000
                                                                                      -----------------

Total comprehensive income                                                            $      1,508,000
                                    ------------------------------------------------  =================     ---------------

Balances,
 December 31, 2000                        121,000          6,000          2,670,000                              (312,000)

Purchase of treasury stock

Net income                                                                            $         81,000

Other comprehensive income,
 net of tax effect

    Minimum pension liability
     adjustment                                                                                 37,000 (a)         37,000
                                                                                      -----------------

Total comprehensive income                                                            $        118,000
                                    ------------------------------------------------  =================     ---------------

Balances,
 December 31, 2001                   $    121,000  $       6,000   $      2,670,000                         $    (275,000)
                                    ================================================                        ===============


<CAPTION>

                                        Retained        Treasury
                                        Earnings          Stock            Total
<S>                                   <C>             <C>             <C>
Balances,
 January 1, 1999                      $   6,574,000   $  (1,117,000)  $      9,281,000

Purchase of treasury stock                                 (116,000)          (116,000)

Net income                                1,582,000                          1,582,000

Other comprehensive income,
 net of tax effect

    Minimum pension liability
     adjustment                                                               (100,000)
    Net unrealized loss on
     marketable securities                                                    (440,000)

Total comprehensive income
                                    ---------------------------------------------------
Balances,
 December 31, 1999                        8,156,000      (1,233,000)        10,207,000

Purchase of treasury stock                                 (288,000)          (288,000)

Retirement of treasury stock                              1,233,000

Net income                                1,074,000                          1,074,000
Other comprehensive income,
 net of tax effect
    Minimum pension liability
     adjustment                                                                 68,000
    Net unrealized gain on
     marketable securities                                                     366,000


Total comprehensive income
                                    ---------------------------------------------------
Balances,
 December 31, 2000                        9,230,000        (288,000)        11,427,000

Purchase of treasury stock                                 (495,000)          (495,000)

Net income                                   81,000                             81,000

Other comprehensive income,
 net of tax effect

    Minimum pension liability
     adjustment                                                                 37,000

Total comprehensive income
                                    ---------------------------------------------------

Balances,
 December 31, 2001                    $   9,311,000   $    (783,000)  $     11,050,000
                                    ===================================================
</TABLE>

(a)  Minimum pension liability adjustment has been recorded net of tax effects
     of $19,000, $35,000 and $52,000, respectively, in 2001, 2000 and 1999.

(b)  Net unrealized gain (loss) on marketable securities has been recorded net
     of tax effects (credit) of $189,000 and ($227,000), respectively, in 2000
     and 1999.

See notes to consolidated financial statements.                              F-5

<PAGE>

EXX INC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

================================================================================

<TABLE>
<CAPTION>
Years Ended December 31,                                                2001               2000               1999
----------------------------------------------------------------------------------------------------------------------
<S>                                                                <C>               <C>                 <C>
Cash flows from operating activities
  Net income                                                       $     81,000       $  1,074,000       $  1,582,000
  Adjustments to reconcile net income to net
  cash provided by (used in) operating activities:
    Depreciation and amortization                                       248,000            260,000            288,000
    Deferred income taxes                                               112,000            201,000            199,000
    Equity in losses of Newcor, Inc.                                  1,679,000            598,000            863,000
    Accrued interest income                                                                                   (30,000)
    Loss on sale of property and equipment                                                  11,000
    Increase (decrease) in cash and cash equivalents
    attributable to changes in operating assets and liabilities:
      Accounts receivable                                               711,000            494,000         (1,042,000)
      Inventories                                                       375,000             (4,000)           561,000
      Other current assets                                              110,000             (7,000)           (73,000)
      Refundable income taxes                                           131,000            (41,000)          (111,000)
      Other assets                                                      (88,000)           (19,000)           (97,000)
      Accounts payable and other current liabilities                    158,000           (331,000)          (345,000)
      Income taxes payable                                                                                   (285,000)
                                                                   --------------------------------------------------

Net cash provided by (used in) operating activities                   3,517,000          2,236,000          1,510,000
                                                                   --------------------------------------------------

Cash flows from investing activities
    Purchases of property and equipment                                 (24,000)           (77,000)          (227,000)
    Proceeds from sale of property and equipment                                           106,000
    Proceeds from maturities of short-term investments                  600,000          3,934,000
    Purchase of short-term investments                                                                     (1,125,000)
    Purchase of investments in Newcor                                (1,679,000)          (397,000)        (1,063,000)
                                                                   --------------------------------------------------

Net cash provided by (used in) investing activities                  (1,103,000)         3,566,000         (2,415,000)
                                                                   --------------------------------------------------
Cash flows from financing activities
    Payments on long-term debt                                          (69,000)           (57,000)           (47,000)
    Purchase of treasury stock                                         (495,000)          (288,000)          (116,000)
                                                                   --------------------------------------------------

Net cash provided by (used in) financing activities                    (564,000)          (345,000)          (163,000)
                                                                   --------------------------------------------------
Net increase (decrease) in cash and
 cash equivalents                                                     1,850,000          5,457,000         (1,068,000)

Cash and cash equivalents, beginning of year                          7,772,000          2,315,000          3,383,000
                                                                   --------------------------------------------------

Cash and cash equivalents, end of year                             $  9,622,000       $  7,772,000       $  2,315,000
                                                                   ==================================================
</TABLE>

See notes to consolidated financial statements.

                                                                             F-6

<PAGE>

EXX INC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

<TABLE>
<CAPTION>
=============================================================================================
Years Ended December 31,                               2001           2000           1999
---------------------------------------------------------------------------------------------
<S>                                                 <C>            <C>           <C>
Supplemental disclosures of cash flow
information, cash paid during the year for:
Interest                                            $   85,000     $   95,000    $     97,000
                                                    =========================================

Income taxes                                        $  670,000     $  951,000    $  1,425,000
                                                    =========================================
</TABLE>

See notes to consolidated financial statement.

                                                                             F-7

<PAGE>

EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

================================================================================

1. Nature of operations

EXX INC and Subsidiaries (collectively the "Company") operate primarily in the
mechanical equipment and toy industries. Operations in the mechanical equipment
industry primarily involve the design, assembly and sale of capital goods, such
as electric motors and cable pressurization equipment. The Company's mechanical
equipment products are incorporated into customers' products or are used to
maintain customers' equipment. Operations in the toy industry involve the
design, assembly and distribution of consumer goods in the form of toys and
kites, which are primarily imported from the Far East.

2. Summary of significant accounting policies

Principles of Consolidation

The consolidated financial statements include the accounts of EXX INC and its
wholly owned subsidiaries. All material intercompany accounts and transactions
have been eliminated in consolidation.

Revenue Recognition

The Company recognizes revenues when goods are shipped and title passes to
customers. Provisions are established, as appropriate, for uncollectible
accounts, returns and allowances and warranties in connection with sales.

Cash, Cash Equivalents and Short-Term Investments

The Company considers all highly-liquid debt instruments purchased with
maturities of three months or less to be cash equivalents. As of December 31,
2001, and at various times during the year, balances of cash at financial
institutions exceeded the federally insured limit. The Company has not
experienced any losses in such accounts and believes it is not subject to any
significant credit risk on cash and cash equivalents.

The Company's short-term investments are comprised of readily marketable
government debt securities and commercial paper with remaining maturities of
more than 90 days at the time of purchase. These investments are classified as
available for sale and are reported at their fair market value as provided for
under Statement of Financial Accounting Standards No. 115, "Accounting for
Certain Investments in Debt and Equity Securities".

Fair Value of Financial Instruments

The fair value of the Company's assets and liabilities which qualify as
financial instruments under Statement of Financial Accounting Standards No. 107,
"Disclosures About Fair Value of Financial Instruments," approximate the
carrying amounts presented in the accompanying consolidated balance sheets.

                                                                             F-8

<PAGE>

EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

================================================================================

2. Summary of significant accounting policies (continued)

Inventories

Certain inventories are valued at the lower of cost, on the last-in, first-out
("LIFO") method, or market. The remainder of the inventories are valued at the
lower of cost, on the first-in, first out ("FIFO") method, or market.

Impairment of Long-Lived Assets

The Company periodically assesses the recoverability of the carrying amounts of
long-lived assets, including intangible assets. A loss is recognized when
expected undiscounted future cash flows are less than the carrying amount of the
asset. The impairment loss is the difference by which the carrying amount of the
asset exceeds its fair value.

Property and Equipment

Property and equipment are stated at cost and are depreciated or amortized on
the straight-line method over the estimated useful lives of the assets as
follows:

     Buildings and improvements               10 - 25 years
     Machinery and equipment                   3 - 20 years

Maintenance and repairs are charged to operations, while betterments and
improvements are capitalized.

Advertising

Advertising costs are charged to operations as incurred and were $59,000,
$67,000 and $86,000, for 2001, 2000 and 1999, respectively.

Research and Development Costs

Expenditures for research and development are charged to operations as incurred
and were $193,000, $46,000 and $251,000 for 2001, 2000 and 1999, respectively.

Income Taxes

The Company complies with Statement of Financial Accounting Standards No. 109,
"Accounting for Income Taxes", which requires an asset and liability approach to
financial reporting for income taxes. Deferred income tax assets and liabilities
are computed for differences between the financial statement and tax bases of
assets and liabilities that will result in future taxable or deductible amounts,
based on enacted tax laws and rates applicable to the periods in which the
differences are expected to affect taxable income. Valuation allowances are
established, when necessary, to reduce deferred income tax assets to the amount
expected to be realized.

                                                                             F-9

<PAGE>

EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

================================================================================

2. Summary of significant accounting policies (continued)

Income Per Common Share

Statement of Financial Accounting Standards No. 128, "Earnings Per Share",
requires dual presentation of basic and diluted income per share for all periods
presented. Basic income per share excludes dilution and is computed by dividing
income available to common stockholders by the weighted-average number of common
shares outstanding during the period. Diluted income per share reflects the
potential dilution that could occur if securities or other contracts to issue
common stock were exercised or converted into common stock or resulted in the
issuance of common stock that then shared in the income of the Company.

Unexercised stock options to purchase 2,150,000 shares, 250,000 shares, and
250,000 shares of the Company's Class A Common Stock as of December 31, 2001,
2000 and 1999, respectively, were not included in the computation of diluted
earnings per share because the options' exercise prices were greater than the
average market price of the Company's Class A Common Stock.

Use of Estimates

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and 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.

Reclassification

Certain 2000 and 1999 amounts have been reclassified to conform to the 2001
presentation.


3. Short-term investments

The Company's short-term investments consist of the following at December 31,
2000:


 Government securities                             $   300,000
 Other commercial paper                                300,000
 Unrealized loss                                        (1,000)
                                                  ------------

                                                   $   599,000
                                                  ============

                                                                            F-10

<PAGE>

EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

================================================================================

4.   Investment in Newcor, Inc.

In July 2001, the Company purchased an additional 679,994 shares of Newcor Inc.
("Newcor") common stock and $500,000 principal amount of Newcor's 9.875% Senior
Subordinated Notes due 2008, from five of the former directors of Newcor and
24,000 shares from David A. Segal (the Company's Chairman). In connection with
such purchases, the Company paid an aggregate of $1,679,000 in cash. Prior to
the Company's acquisition of these additional shares, the Company accounted for
its investment in Newcor as an available for sale marketable security. The
changes in the market value of the Newcor shares were recorded as comprehensive
income in each applicable period. The additional acquisition increased the
Company's ownership percentage in Newcor to approximately 31%, thereby requiring
the Company to use the equity method of accounting for this investment in
accordance with Accounting Principles Board Opinion No. 18, "The Equity Method
of Accounting for Investments in Common Stock." The change to the equity method
is considered a change in reporting entity, requiring the Company to give
retroactive effect to this change in all prior periods that Newcor stock was
held. The consolidated financial statements for all periods prior to December
31, 2001 have been restated to give effect to this change. As of December 31,
2001, the Company owns approximately 1,546,000 shares of the outstanding common
stock of Newcor and based on its equity in the losses of Newcor, the Company has
reduced its investment (including subordinated notes) in Newcor to zero. At
December 31, 2001, the aggregate fair market value of the investment in Newcor
is approximately $570,000. In February 2002, Newcor Inc., filed for bankruptcy
under Chapter 11 of the U.S. Bankruptcy Act.

The following table summarized the effects on the net income and net income per
share of the Company as a result of the change in reporting entity due to the
increased ownership percentage in Newcor:

<TABLE>
<CAPTION>
Net Income                                         2000               1999
<S>                                            <C>              <C>
Net income, as previously reported             $  1,672,000     $   2,445,000

Equity in losses of Newcor                         (598,000)         (863,000)
                                               ------------------------------

Net income, as restated                        $  1,074,000     $   1,582,000
                                               ==============================

Net income per share - Basic

Net income per share, as
 previously reported                           $       0.13     $        0.19

Equity in losses of Newcor                            (0.04)            (0.07)
                                               ------------------------------

Net income per share, as restated              $       0.09     $        0.12
                                               ==============================

Net income per share - Diluted

Net income per share, as
 previously reported                           $       0.13     $        0.18

Equity in losses of Newcor                            (0.05)            (0.06)
                                               ------------------------------

Net income per share, as restated              $       0.08     $        0.12
                                               ==============================
</TABLE>

                                                                            F-11

<PAGE>

EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

================================================================================

4.   Investment in Newcor, Inc. (continued)

The summarized financial information of Newcor is as follows:

<TABLE>
<CAPTION>
December 31,                         2001             2000
<S>                             <C>              <C>
Current assets                  $  37,865,000    $  52,897,000
Other assets                       91,879,000      136,415,000
                                ------------------------------

                                $ 129,744,000    $ 189,312,000
                                ==============================


Current liabilities             $ 163,215,000    $  38,487,000
Other liabilities                  16,971,000      144,017,000
Stockholders' equity              (50,442,000)       6,808,000
                                ------------------------------

                                $ 129,744,000    $ 189,312,000
                                ==============================
</TABLE>

<TABLE>
<CAPTION>
Years ended December 31,             2001             2000             1999
<S>                             <C>              <C>              <C>
Net sales                       $ 177,342,000    $ 238,115,000    $ 258,430,000
Gross profit                       14,872,000       32,858,000       39,774,000
Net loss                          (57,250,000)      (6,582,000)     (11,580,000)
</TABLE>

5.   Inventories

Inventories consist of the following at December 31, 2001 and 2000:

<TABLE>
<CAPTION>
                                     2001            2000
<S>                             <C>              <C>
Raw materials                   $     838,000    $     979,000
Work-in-progress                      164,000          214,000
Finished goods                      1,618,000        1,802,000
                                ------------------------------

                                $   2,620,000    $   2,995,000
                                ==============================
</TABLE>

Inventories stated on the LIFO method amounted to $323,000 and $517,000 at
December 31, 2001 and 2000, respectively, which amounts are below replacement
cost by approximately $396,000 and $371,000, respectively.

During 2001, 2000, and 1999, net income was not materially affected as a result
of using the LIFO method.

                                                                            F-12

<PAGE>

EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

================================================================================

6.   Property and equipment

Property and equipment consists of the following at December 31, 2001 and 2000:

<TABLE>
<CAPTION>
                                             2001             2000
<S>                                      <C>              <C>
Land                                     $    41,000      $    41,000
Buildings and improvements,
 including $1,617,000 under
 a capital lease                           2,993,000        2,987,000
Machinery and equipment                    6,462,000        6,444,000
                                         ----------------------------

                                           9,496,000        9,472,000
Less accumulated depreciation
 and amortization, including
 $526,000 and $438,000 under a
 capital lease in 2001 and 2000,
 respectively                              7,695,000        7,447,000
                                         ----------------------------

                                         $ 1,801,000      $ 2,025,000
                                         ============================
</TABLE>

7.   Other assets

Other assets consist of the following at December 31, 2001 and 2000:

<TABLE>
<CAPTION>
                                              2001           2000
<S>                                      <C>              <C>
Notes receivable, less current portion   $    83,000      $    83,000
Prepaid pension                              399,000          311,000
                                         ----------------------------

                                         $   482,000      $   394,000
                                         ============================
</TABLE>

                                                                            F-13

<PAGE>

EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

================================================================================

8.   Long-term debt

Long-term debt at December 31, 2001 and 2000 is comprised of the following:

<TABLE>
<CAPTION>
                                               2001            2000
   <S>                                     <C>            <C>
   Note payable with monthly
   payments of approximately
   $4,000, including interest
   at 4%, through September
   2015, collateralized by
   substantially all of the
   assets of a subsidiary                  $    433,000   $    464,000

   Note payable with monthly
   payments of approximately
   $2,000, including interest
   at 4%, through December
   2023, collateralized by
   substantially all of the
   assets of a subsidiary                       382,000        393,000

   Capital lease obligation                     806,000        833,000
                                           ---------------------------
                                              1,621,000      1,690,000
   Less current portion                          66,000         63,000
                                           ---------------------------

                                           $  1,555,000   $  1,627,000
                                           ===========================
</TABLE>

Future aggregate required principal payments for each of the next five years are
as follows:

<TABLE>
<S>                                                       <C>
Year ending December 31,
        2002                                              $     66,000
        2003                                                    69,000
        2004                                                    76,000
        2005                                                    99,000
        2006                                                   104,000
</TABLE>

                                                                            F-14

<PAGE>

EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

================================================================================

8.   Long-term debt (continued)

Aggregate minimum lease payments for the obligation under the capital lease in
the years subsequent to December 31, 2001 are as follows:

<TABLE>
  <S>                                                     <C>
  Year ending December 31,
     2002                                                 $    78,000
     2003                                                      78,000
     2004                                                      82,000
     2005                                                     101,000
     2006                                                     101,000
  Thereafter                                                  819,000
                                                          -----------

  Total minimum lease payments                              1,259,000
  Less amount representing interest                           453,000
                                                          -----------

  Present value of future minimum
  lease payments                                          $   806,000
                                                          ===========
</TABLE>

9.   Accounts payable and other current liabilities

Accounts payable and other current liabilities consist of the following at
December 31, 2001 and 2000:

<TABLE>
<CAPTION>
                                               2001            2000
<S>                                        <C>            <C>
Trade accounts payable                     $   852,000    $   958,000
Warranty                                       581,000        580,000
Payroll and related costs                    1,054,000        479,000
Royalties payable                              300,000        339,000
Commissions payable                            318,000        420,000
Product liability claim                        350,000        350,000
Other                                          360,000        531,000
                                           --------------------------

                                           $ 3,815,000    $ 3,657,000
                                           ==========================
</TABLE>

                                                                            F-15

<PAGE>


EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


================================================================================

10.  Income taxes

The provision for income taxes consists of the following:

                                   2001           2000             1999

Current
   Federal                     $ 800,000       $ 654,000      $ 1,029,000

Deferred
   Federal                       113,000         201,000          199,000
                               ------------------------------------------

                               $ 913,000       $ 855,000      $ 1,228,000
                               ==========================================

Substantially all of the Company's taxable income was generated in states with
no state or local income taxes.

The following reconciles the Federal statutory tax rate to the effective income
tax rate:


                                              2001       2000        1999
                                                %          %           %
Federal statutory rate                        34.0       34.0        34.0
Change in valuation allowance                 57.4       10.5        10.4
Other                                          0.5       (0.2)       (0.7)
                                        ---------------------------------

Effective income tax rate                     91.9       44.3        43.7
                                        =================================


The net deferred tax assets and liabilities as of December 31, 2001 and 2000 are
as follows:

                                                         2001           2000
Deferred tax assets
   Allowance for doubtful accounts,
    warranty and notes receivable                  $    396,000    $   398,000
   Equity in loss of Newcor                           1,068,000        497,000
   Asset basis difference for inventories                80,000         83,000
   Pension obligations                                    7,000         62,000
   Other                                                 42,000         51,000
                                                   ---------------------------
                                                      1,593,000      1,091,000
   Valuation allowance                               (1,068,000)      (497,000)
                                                   ---------------------------

                                                   $    525,000    $   594,000
                                                   ===========================

                                                                            F-16

<PAGE>

EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


================================================================================

10. Income taxes (continued)

                                                         2001         2000

Deferred tax liabilities
   Accumulated DISC earnings                        $ (494,000)  $ (422,000)
   Asset basis difference for property
    and equipment                                       (5,000)     (13,000)
   Other                                               (68,000)     (68,000)
                                                    -----------------------
                                                      (567,000)    (503,000)
                                                    -----------------------

Deferred tax asset (liability), net                 $  (42,000)  $   91,000
                                                    =======================

The amounts are recorded in the consolidated balance sheets as follows:

                                             2001           2000

Deferred tax asset, current             $  520,000     $   532,000
Deferred tax liability                    (562,000)       (441,000)
                                        --------------------------

                                        $  (42,000)    $    91,000
                                        ==========================

11. Pension plans

The Company participates in two pension plans. One plan covers hourly employees
under union contracts and provides for defined contributions based on annual
hours worked. Pension expense for this plan was $31,000, $58,000 and $52,000 for
2001, 2000, and 1999, respectively.

The Company-sponsored plan is a noncontributory defined benefit pension plan.
Benefits are based on years of service and the employees' highest five year
average earnings. The Company's funding policy is to contribute annually at
least the minimum amount required by the Employee Retirement Income Security Act
of 1974. Effective January 1, 1988, the plan was curtailed through an amendment
to freeze benefits and future participation.

Net periodic pension cost (benefit) for the Company-sponsored plan is as
follows:

                                                2001        2000        1999

Interest cost on projected benefit
 obligation                                  $ 71,000   $  71,000    $ 71,000
Expected return on plan assets                (69,000)    (62,000)    (70,000)
Amortization of net gain (loss) on
 transition assets                             29,000      33,000      22,000
                                             --------------------------------

Net periodic pension cost                    $ 31,000   $  42,000    $ 23,000
                                             ================================

                                                                            F-17

<PAGE>

EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


================================================================================

11. Pension plans (continued)

The following table presents significant assumptions used:

                                       2001           2000          1999

Discount rate                           7%             7%            7%
Expected long-term rate
 of return on plan assets               8%             8%            8%


No adjustments for a rate of compensation increase have been factored into the
plan due to the effective curtailment on benefits and participation.

The following table sets forth the changes in benefit obligations for the years
ended December 31, 2001 and 2000 for the Company-sponsored defined benefit
pension plan:

                                              2001              2000
Benefit obligation - beginning
 of year                                  $ 1,056,000      $ 1,068,000
Interest cost                                  71,000           71,000
Actuarial loss                                 28,000            1,000
Total benefits paid                           (86,000)         (84,000)
                                          ----------------------------

Benefit obligation - end of year          $ 1,069,000      $ 1,056,000
                                          ============================

The following table sets forth the change in plan assets for the years ended
December 31, 2001 and 2000 for the Company-sponsored defined benefit pension
plan:

                                              2001         2000

Fair value of plan assets -
 beginning of year                       $   894,000    $ 784,000
Actual return on plan assets                 124,000      134,000
Company contributions                        120,000       60,000
Benefits paid                                (86,000)     (84,000)
                                         ------------------------

Fair value of plan assets -
 end of year                             $ 1,052,000    $ 894,000
                                         ========================

                                                                            F-18

<PAGE>

EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

================================================================================

11. Pension plans (continued)

The funded status for the years ended December 31, 2001 and 2000 is as follows:

                                                2001              2000

Plan assets less projected
 benefit obligation                         $  (17,000)       $ (162,000)
Unrecognized actuarial net loss                416,000           473,000
Adjustment required to
 recognize minimum pension
 liability                                    (416,000)         (473,000)
                                           -----------------------------

Net amount recognized                       $  (17,000)       $ (162,000)
                                           =============================

Amounts recognized in the consolidated balance sheets consist of the following:


                                                 2001             2000

Prepaid benefit cost                        $  399,000        $  311,000
Accrued benefit liability                     (416,000)         (473,000)
                                           -----------------------------

Net amount recognized                       $  (17,000)       $ (162,000)
                                           =============================

12. Stock options

During 1994, the Company's Board of Directors adopted, and the stockholders
approved, the 1994 stock option plan (the Plan) pursuant to which 5,000,000
shares of Class A common stock were reserved for issuance upon the exercise of
options granted to officers, directors, employees and consultants of the
Company. Options under the Plan may be incentive stock options, nonqualified
stock options, or any combination thereof, and the Board of Directors
(Committee) may grant options at an exercise price which is not less than the
fair market value on the date such options are granted. The Plan further
provides that the maximum period in which stock options may be exercised will be
determined by the Committee, except that they may not be exercisable after ten
years from the date of grant. Unless previously terminated, the Plan shall
terminate in October 2004. At December 31, 2001 and 2000, options to purchase
5,000,000 shares of Class A common stock were available for grant under the
Plan.

                                                                            F-19

<PAGE>

EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

================================================================================

12. Stock options (continued)

The status of the Company's stock options are summarized below:

                                                                       Weighted
                                                         Per Share      Average
                                       Other             Exercise      Exercise
                                      Options             Price         Price

Outstanding and exercisable
 at December 31, 2001, 2000
 and 1999                           2,250,000 (a)     $0.65 - $1.00      $0.74
                                   ==========

(a) Includes options to purchase 2,150,000 shares of Class A common stock and
    100,000 shares of Class B common stock.

13. Commitments and contingencies

Leases

The Company leases office and plant facilities under operating leases on a
month-to-month basis.

Rent expense for 2001, 2000 and 1999 amounted to $77,000, $94,000 and $113,000,
respectively.

Royalty Agreements

The Company has licensing agreements relating to the sale of certain products.
Under the terms of the agreements, the Company is required to pay royalties of
between 6% to 12% on the net sales of the related products. In addition, certain
agreements require advance payments or payments over the lives of the
agreements.

Employment Agreement

The Company has an employment agreement with an officer, who is a principal
stockholder, for a minimum annual salary of approximately $300,000, adjusted
annually for increases in the Consumer Price Index, plus a bonus based on the
Company's earnings. The agreement expires in 2004 and is renewable for an
additional five years unless written notice of non-renewal is given by either
party within 90 days prior to its expiration.

                                                                            F-20

<PAGE>

EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

================================================================================

13. Commitments and contingencies (continued)

Litigation

The Company is a party to various legal matters, the outcome of which, in the
opinion of management, will not have a material adverse effect on the financial
position, results of operations or cash flows of the Company.

14. Segment information

The Company adopted Statement of Financial Accounting Standards No. 131 (SFAS
No. 131), "Disclosures about Segments of an Enterprise and Related Information".
SFAS No. 131 requires disclosures of segment information on the basis that is
used internally for evaluating segment performance and deciding how to allocate
resources to segments.

Segment information listed below reflects the two principal business units of
the Company (as described in Note 1). Each segment is managed according to the
products which are provided to the respective customers and information is
reported on the basis of reporting to the Company's Chief Operating Decision
Maker.

Operating segment information for 2001, 2000, and 1999 is summarized as follows:

<TABLE>
<CAPTION>
                                                  Mechanical
                                  Toy             Equipment       Corporate   Consolidated

2001
<S>                           <C>               <C>             <C>           <C>
 Net sales                    $ 7,472,000       $ 10,910,000    $         -   $ 18,382,000
                              ============================================================

 Operating income (loss)      $ 1,011,000       $  1,985,000    $  (617,000)  $  2,379,000
 Interest expense                (124,000)                          (16,000)      (140,000)
 Interest income                   63,000             34,000        269,000        366,000
 Other income                       4,000             64,000                        68,000
 Equity in losses of Newcor                                      (1,679,000)    (1,679,000)
                              ------------------------------------------------------------
 Income (loss) before
 income taxes (benefit)       $   954,000       $  2,083,000     (2,043,000)  $    994,000
                              ============================================================

 Assets                       $ 4,928,000          3,924,000      8,612,000     17,464,000
                              ============================================================
 Depreciation and
     amortization             $   148,000       $    100,000    $         -   $    248,000
                              ============================================================

 Capital expenditures         $         -       $     24,000    $         -   $     24,000
                              ============================================================
</TABLE>

                                                                            F-21

<PAGE>


EXX INC AND SUBSIDIARIES


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

================================================================================

14. Segment information (continued)

<TABLE>
<CAPTION>
                                                    Mechanical
                                      Toy           Equipment         Corporate         Consolidated
<S>                              <C>              <C>               <C>                 <C>
2000
  Net sales                      $ 7,248,000      $ 11,915,000      $          -        $ 19,163,000
                                 ===================================================================

  Operating income (loss)        $   732,000      $  2,197,000      $   (802,000)       $  2,127,000
  Interest expense                   (94,000)                            (18,000)           (112,000)
  Interest income                     28,000            53,000           388,000             469,000
  Other income                         5,000            38,000                                43,000
  Equity in losses of Newcor                                            (598,000)           (598,000)
                                 -------------------------------------------------------------------
  Income (loss) before
   income taxes (benefit)        $   671,000      $  2,288,000      $ (1,030,000)       $  1,929,000
                                 ===================================================================

  Assets                         $ 5,708,000      $  3,930,000      $  8,050,000        $ 17,688,000
                                 ===================================================================
  Depreciation and
   amortization                  $   166,000      $     94,000      $          -        $    260,000
                                 ===================================================================
   Capital expenditures          $         -      $     77,000      $          -        $     77,000
                                 ===================================================================

<CAPTION>
                                                    Mechanical
                                      Toy           Equipment         Corporate         Consolidated
<S>                              <C>              <C>               <C>                 <C>
1999
  Net sales                      $ 7,292,000      $ 13,866,000      $          -        $ 21,158,000
                                 ===================================================================

  Operating income (loss)        $   587,000      $  3,462,000      $   (641,000)       $  3,408,000
  Interest expense                   (96,000)                            (16,000)           (112,000)
  Interest income                     19,000            49,000           215,000             283,000
  Other income                        24,000            70,000                                94,000
  Equity in losses of Newcor                                            (863,000)           (863,000)
                                 -------------------------------------------------------------------
  Income (loss) before
   income taxes (benefit)        $   534,000      $  3,581,000      $ (1,305,000)       $  2,810,000
                                 ===================================================================

  Assets                         $ 6,015,000      $  3,428,000      $  7,343,000 (a)    $ 16,786,000
                                 ===================================================================
  Depreciation and
  amortization                   $   194,000      $     94,000      $          -        $    288,000
                                 ===================================================================
  Capital expenditures           $    33,000      $    194,000      $          -        $    227,000
                                 ===================================================================
</TABLE>

(a) Corporate assets consist primarily of cash, short-term investments and
    long-term investments, as described in Note 2.

                                                                            F-22

<PAGE>

EXX INC AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

================================================================================

14. Segment information (continued)

Net sales to countries outside of the United States for the years ended December
31, 2001, 2000 and 1999 were approximately $1,534,000, $2,073,000 and
$1,608,000, respectively, and were attributable primarily to sales from the
Company's mechanical equipment segment. There were no significant sales to any
individual country or region outside of the United States.

Net sales to one customer were approximately 33%, 25% and 20% for the years
ended December 31, 2001, 2000 and 1999, respectively.

15. Selected quarterly results (unaudited)

<TABLE>
<CAPTION>
                                   First            Second              Third            Fourth
                                  Quarter           Quarter            Quarter           Quarter
<S>                            <C>                <C>                <C>               <C>
2001
   Net sales                   $ 4,978,000        $ 4,927,000        $ 4,900,000       $ 3,577,000
                               ===================================================================
   Gross profit                $ 1,514,000        $ 1,856,000        $ 1,694,000       $ 1,754,000
                               ===================================================================
   Net income                  $   391,000        $   485,000        $(1,167,000)      $   372,000
                               ===================================================================
   Income per common
    share and common
    share equivalent:
     Basic                            0.03               0.04              (0.10)             0.04
                               ===================================================================
     Dilutive                         0.03               0.04              (0.10)             0.04
                               ===================================================================

2000
   Net sales                   $ 5,420,000        $ 4,098,000        $ 4,490,000       $ 5,155,000
                               ===================================================================
   Gross profit                $ 2,162,000        $ 1,266,000        $ 1,413,000       $ 2,498,000
                               ===================================================================
   Net income                  $   757,000        $   279,000        $   222,000       $  (184,000)
                               ===================================================================
   Income per common
    share and common
    share equivalent:
     Basic                            0.06               0.02               0.02             (0.01)
                               ===================================================================
     Dilutive                         0.05               0.02               0.02             (0.01)
                               ===================================================================
</TABLE>

                                                                            F-23

<PAGE>

EXX INC AND SUBSIDIARIES

SCHEDULE II
VALUATION AND QUALIFYING ACCOUNTS

================================================================================

<TABLE>
<CAPTION>
   COLUMN A                                                Column B        Column C          Column D          Column E

                                                          Balance at      Additions -       Deductions         Balance
                                                          Beginning         Charged            from             at End
   DESCRIPTION                                            Of Period        to Income         Reserves         of Period
<S>                                                    <C>               <C>              <C>               <C>
2001
  Reserve for bad debts and allowances                  $     88,000     $     3,000      $          -      $       91,000
                                                       ====================================================================

  Warranty                                              $    580,000     $     1,000      $          -      $      581,000
                                                       ====================================================================

  Reserve for dispositions of inventories               $    496,000     $         -      $      2,000      $      494,000
                                                       ====================================================================


2000
  Reserve for bad debts and allowances                  $     84,000     $     4,000      $          -      $       88,000
                                                       ====================================================================

  Warranty                                              $    587,000     $         -      $      7,000      $      580,000
                                                       ====================================================================

  Reserve for dispositions of inventories               $    592,000     $         -      $     96,000      $      496,000
                                                       ====================================================================


1999
  Reserve for bad debts and allowances                  $    208,000     $         -      $    124,000      $       84,000
                                                       ====================================================================

  Warranty                                              $    580,000     $   207,000      $    200,000      $      587,000
                                                       ====================================================================

  Reserve for dispositions of inventories               $    593,000     $         -      $      1,000      $      592,000
                                                       ====================================================================
</TABLE>

                                                                             S-1

