Business description of U-S-GLOBAL-INVESTORS-INC from last 10-k form

i

Lines of Business

Corporate Investments

Employees

Competition

Market Information

Holders

Dividends

Securities authorized for issuance under equity compensation plans

Purchases of equity securities by the issuer

Company Performance Presentation

Business Segments

Securities

    Market Value      Cost      Unrealized Gain
(Loss)		      Unrealized holding gains on
available-for- sale
securities, net of  tax		  

Trading¹

    $ 5,216,139       $ 5,960,634       $ (744,495)         N/A   

Available-for-sale²

      8,824,311         8,117,844         706,467       $ 466,268   
  

 

 

     

 

 

     

 

 

     

Total at June 30, 2012

    $ 14,040,450       $ 14,078,478       $ (38,028)      
  

 

 

     

 

 

     

 

 

     

Trading¹

    $ 5,703,916       $ 5,963,272       $ (259,356)         N/A   

Available-for-sale²

      4,660,928         3,081,439         1,579,489       $ 1,042,462   
  

 

 

     

 

 

     

 

 

     

Total at June 30, 2011

    $ 10,364,844       $ 9,044,711       $ 1,320,133      
  

 

 

     

 

 

     

 

 

     

Consolidated Results of Operations

(Dollars in Thousands)

    2012      2011      %
Change		      2011      2010      %
Change		  

Investment advisory fees:

                  

Natural resource funds

    $ 11,085       $ 20,341         (45.5%)       $ 20,341       $ 15,264         33.3%   

International equity funds

      3,104         5,735         (45.9%)         5,735         5,567         3.0%   

Domestic equity funds

      386         495         (22.0%)         495         299         65.6%   

Fixed income funds

      -         -         0.0%         -         33         (100.0%)   
  

 

 

     

 

 

        

 

 

     

 

 

     

Total mutual fund advisory fees

      14,575         26,571         (45.1%)         26,571         21,163         25.6%   

Other advisory fees

      358         1,387         (74.2%)         1,387         401         245.9%   
  

 

 

     

 

 

        

 

 

     

 

 

     

Total investment advisory fees

      14,933         27,958         (46.6%)         27,958         21,564         29.7%   

Transfer agent fees

      3,667         5,011         (26.8%)         5,011         5,350         (6.3%)   

Distribution fees

      4,070         5,988         (32.0%)         5,988         5,293         13.1%   

Administrative services fees

      1,321         1,922         (31.3%)         1,922         1,797         7.0%   

Investment income (loss)

      (177)         1,009         (117.5%)         1,009         979         3.1%   

Other revenues

      37         46         (19.6%)         46         47         (2.1%)   
  

 

 

     

 

 

        

 

 

     

 

 

     

Total

    $ 23,851       $ 41,934         (43.1%)       $ 41,934       $ 35,030         19.7%   
  

 

 

     

 

 

        

 

 

     

 

 

     

(Dollars in Thousands)

    2012      2011      %
Change		      2011      2010      %
Change		  

Employee compensation and benefits

    $ 9,991       $ 12,468         (19.9%)       $ 12,468       $ 11,913         4.7%   

General and administrative

      5,841         8,201         (28.8%)         8,201         6,516         25.9%   

Platform fees

      3,995         6,304         (36.6%)         6,304         5,583         12.9%   

Advertising

      1,182         2,464         (52.0%)         2,464         1,625         51.6%   

Depreciation

      282         292         (3.4%)         292         321         (9.0%)   

Subadvisory fees

      60         175         (65.7%)         175         563         (68.9%)   
  

 

 

     

 

 

        

 

 

     

 

 

     

Total

    $ 21,351       $ 29,904         (28.6%)       $ 29,904       $ 26,521         12.8%   
  

 

 

     

 

 

        

 

 

     

 

 

     

Contractual Obligations

    Payments due by period  
   Total      Less than      1-3      4-5      More than  
      1 year      years      years      5 years  

Operating lease obligations

    $ 225,616       $ 185,164       $ 40,452       $ –       $ –   

Contractual obligations

      747,860         537,190         210,670         –         –   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  

Total

    $ 973,476       $ 722,354       $ 251,122       $ –       $ –   
  

 

 

     

 

 

     

 

 

     

 

 

     

 

 

  
    Fair Value at
June 30, 2012		     Hypothetical
Percentage Change		   Estimated Fair
Value After
Hypothetical Price
Change		     Increase (Decrease) in
Shareholders’ Equity,
Net of Tax		  

Trading securities 1

     $5,216,139      25% increase     $6,520,174         $860,663   
    25% decrease     $3,912,104        ($860,663 ) 

Available-for-sale 2

     $8,824,311      25% increase     $11,030,389         $1,456,011   
    25% decrease     $6,618,233        ($1,456,011 ) 

Notes to Consolidated Financial Statements

The directors and executive officers of the Company are as follows:

 

Name

   

Age

   

Position

Frank E. Holmes

    57   

Director of the Company and Chief Executive Officer of the Company since October 1989, and Chief Investment Officer since June 1999. Since October 1989, Mr. Holmes has served and continues to serve in various positions with the Company, its subsidiaries, and the investment companies it sponsors. Mr. Holmes has served as Trustee of U.S. Global Investors Funds since August 1989 and Trustee of U.S. Global Accolade Funds from April 1993 to October 2008. Mr. Holmes has also served as Director of Meridian Fund Managers Ltd. since November 2003, Director of Meridian Global Gold & Resources Fund Ltd. since December 2003, Director of Meridian Global Energy & Resources Fund Ltd. since April 2006, Director of Meridian Global Dividend Income Fund since April 2011 and Chairman of Endeavour Financial Corp. from October 2005 to November 2008. Mr. Holmes served as Director of 71316 Ontario, Inc. from April 1987 to October 2006, and Director, President, and Secretary of F.E. Holmes Organization, Inc. from July 1978 to July 2009.

Jerold H. Rubinstein

    74   

Chairman of the Board of Directors since February 2006 and Director of the Company since October 1989. Board member and Chairman of the Audit Committee of CKE Restaurants since June 2006; Board member and Chairman of the Audit Committee of Stratus Media Group, Inc. since April 2011. Founder and Chief Executive Officer of Music Imaging & Media, Inc. from July 2002 to January 2010. Board member, Chief Executive Officer, and Chairman of the Board for ProElite, Inc. since June 2012.

Roy D. Terracina

    65   

Director of the Company since December 1994 and Vice Chairman of the Board of Directors since May 1997. Owner of Sunshine Ventures, Inc., a company formed to hold investments, since January 1994. Chairman of the Board of Our Lady of the Lake University since May 2010.

Thomas F. Lydon, Jr.

    52   

Director of the Company since June 1997. Chairman of the Board and President of Global Trends Investments since April 1996. Member of the Board of Trustees of Rydex/SGI since June 2005 (Rydex/SGI purchased by Guggenheim Investments as of February 2012).

Susan B. McGee

    53   

President of the Company since February 1998, General Counsel since March 1997. Since September 1992, Ms. McGee has served and continues to serve in various positions with the Company, its subsidiaries, and the investment companies it sponsors.

Catherine A. Rademacher

    52   

Chief Financial Officer of the Company since August 2004. Controller of the Company from April 2004 until August 2004. Since April 2004, Ms. Rademacher has served and continues to serve in various positions with the Company, its subsidiaries, and the investment companies it sponsors.

None of the directors or executive officers of the Company has a family relationship with any of the other directors or executive officers.

The members of the Board of Directors are elected for one-year terms or until their successors are elected and qualified. The Board of Directors appoints the executive officers of the Company.

Independent Directors    Audit Committee    Compensation Committee   

Roy D. Terracina

   

Chairman

   

Member

   

Thomas F. Lydon, Jr.

   

Member

   

Chairman

   

Jerold H. Rubinstein

   

Member

   

Member

   
Name   Title

Frank E. Holmes

  

Chief Executive Officer and Chief Investment Officer

Catherine A. Rademacher

  

Chief Financial Officer

Susan B. McGee

  

President and General Counsel

Summary Compensation Table

  

Name and Principal

Position

    Year      Salary
($)		      Bonus
($)		      Stock
Awards
($)		      Non-Equity
Incentive Plan
Compensation
($) 1		      All  Other
Compensation
($)		     Total
($)		  

Frank E. Holmes

      2010         421,799         9,600         —         683,803         136,715        1,251,917   

Chief Executive Officer

      2011         421,799         6,300         —         880,591         150,012        1,458,702   

Chief Investment Officer

      2012         421,799         6,200         —         257,175         162,336  2      847,510   

Catherine A. Rademacher

      2010         96,000         89,740         6,550         —         28,922        221,212   

Chief Financial Officer

      2011         98,006         98,416         28,780         —         31,211        256,413   
     2012         100,021         62,226         12,374         —         37,496  3      212,117   

Susan B. McGee

      2010         256,895         74,500         6,550         77,901         136,814        552,660   

President

      2011         256,895         74,898         16,600         120,263         131,311        599,967   

General Counsel

      2012         258,041         35,891         11,539         44,758         147,083  4      497,312   

 

Grants of Plan-Based Awards

  

Name

    Grant Date     All Other Stock
Awards:  Number
of Shares of
Stock or Units		      Grant Date Fair
Value  of Stock and
Option Awards
(per share)		      Grant Date Fair
Value of Stock
and Option
Awards		  

Frank E. Holmes

      —        —         —         —   

Catherine A. Rademacher

      1/4/2012        1,000       $ 6.38       $ 6,380   
     7/16/2012  1      1,000       $ 4.11       $ 4,110   
     7/31/2012  1      400       $ 4.71       $ 1,884   

Susan B. McGee

      1/4/2012        500       $ 6.38       $ 3,190   
     7/16/2012  1      1,000       $ 4.11       $ 4,110   
     7/31/2012  1      900       $ 4.71       $ 4,239   

 

Name and Address of Beneficial Owner

    Class C
Common
Shares
Beneficially
Owned		      Percent of
Class (%)		  

Frank Holmes

      2,064,560         99.59 % 

7900 Callaghan Road

      

San Antonio, TX 78229

      

Name and Address of Beneficial Owner

    Class A
Common
Shares
Beneficially
Owned		     Percent of
Class (%)		  

Royce & Associates, LLC – New York, NY 1

      1,933,041  1      14.45 % 

Financial & Investment Management Group, Ltd. – Traverse City, MI 2

      1,372,629  2      10.26 % 

 

Security Ownership of Management

                                                                   

Beneficial Owner

    Class C
Common Stock		      Class A
Common Stock		  
   Number of
Shares		        %      Number of
Shares		        %  

Frank E. Holmes, CEO, Director

      2,064,560           99.59%         300,924           2.24%   

Catherine A. Rademacher, CFO

      —             —           22,913           0.17%   

Susan B. McGee, President, General Counsel

      —             —           81,684           0.61%   

Jerold H. Rubinstein, Director

      —             —           5,700           0.04%   

Roy D. Terracina, Director

      —             —           39,700           0.30%   

Thomas F. Lydon, Jr., Director

      —             —           5,700           0.04%   
  

 

 

          

 

 

       

All directors and executive officers as a group (six persons)

      2,064,560           99.59%         456,621           3.41%   

Audit Committee Pre-Approval Policies

1. Financial Statements

2. Financial Statement Schedules

3. Exhibits

  

3.1

       Fourth Restated and Amended Articles of Incorporation of Company, incorporated by reference to the Company’s Form 10-Q for the quarterly report ended March 31, 2007 (EDGAR Accession Number 000095134-07-010817).
  

3.2

       Amended and Restated By-Laws of Company, incorporated by reference to Exhibit 3.02 of the Company’s Form 8-K filed on November 8, 2006, (EDGAR Accession Number 0000754811-06-000076).
  

10.1

       Advisory Agreement with U.S. Global Investors Funds, dated October 1, 2008, incorporated by reference to Post-Effective Amendment 100 filed October 1, 2008 (EDGAR Accession No. 0000950134-08-017422).
  

10.2

       Amended and Restated Transfer Agency Agreement, dated January 15, 2010, by and between U.S. Global Investors Funds and United Shareholder Services, Inc., incorporated by reference to Post-Effective Amendment 105 filed February 26, 2010 (EDGAR Accession No. 0000950123-10-018191).
  

10.3

       Amended and Restated Administrative Services Agreement, dated January 15, 2010, by and between U.S. Global Investors Funds and U.S. Global Investors, Inc., incorporated by reference to Post-Effective Amendment 105 filed February 26, 2010 (EDGAR Accession No. 0000950123-10-018191).
  

10.4

       Amended and Restated Distribution Plan Pursuant to Rule 12b-1 Plan, dated January 15, 2010, by and between U.S. Global Investors Funds and U.S. Global Brokerage, Inc., incorporated by reference to Post-Effective Amendment 105 filed February 26, 2010 (EDGAR Accession No. 0000950123-10-018191).
   10.5       Amended and Restated Distribution Agreement dated March 4, 2010, by and between U.S. Global Investors Funds and U.S. Global Brokerage, Inc., incorporated by reference to Post-Effective Amendment 107 filed April 30, 2010 (EDGAR Accession No. 0001104659-10-024038).
   10.6       United Services Advisors, Inc. 1985 Incentive Stock Option Plan as amended November 1989 and December 1991, incorporated by reference to Exhibit 4(b) of the Company’s Registration Statement No. 33-3012, Post-Effective Amendment No. 2, filed on Form S-8 with the Commission on April 23, 1997 (EDGAR Accession No. 0000754811-97-000004).
   10.7       United Services Advisors, Inc. 1989 Non-Qualified Stock Option Plan, incorporated by reference to Exhibit 4(a) of the Company’s Registration Statement No. 33-3012, Post-Effective Amendment No. 2, filed on Form S-8 with the Commission on April 23, 1997 (EDGAR Accession No. 0000754811-97-000004).
   10.8       U.S. Global Investors, Inc. 1997 Non-Qualified Stock Option Plan, incorporated by reference to Exhibit 4 of the Company’s Registration Statement No. 333-25699 filed on Form S-8 with the Commission on April 23, 1997 (EDGAR Accession No. 0000754811-97-000003).
   10.9       Line of Credit Note dated June 3, 2005, between the Company and JP Morgan Chase Bank N.A., incorporated by reference to Exhibit 10.10 of the Company’s Form 10-K for fiscal year ended June 30, 2006 (EDGAR Accession No. 0000950134-06-017619).
   10.10       2010 Stock Incentive Plan, incorporated by reference, filed on September 26, 2011 (EDGAR Accession No. 0000950123-11-082564).
   10.11       Reserved
   10.12       Amendment dated February 26, 2009 to Credit Agreement dated June 3, 2005, and Line of Credit Note dated February 26, 2009 by and between the Company and JP Morgan Chase Bank N.A., incorporated by reference, filed on September 10, 2009 (EDGAR Accession No. 0000950123-09-042459).
   10.13       Registration statement for the U.S. Global Investors, Inc. Employee Stock Purchase Plan, as amended May 9, 2005, incorporated by reference, filed July 8, 2008 (EDGAR Accession No. 0000950134-08-012469).
   10.14       Registration statement for the U.S. Global Investors, Inc. 401(k) Plan, as amended January 1, 2007, incorporated by reference, filed July 8, 2008 (EDGAR Accession No. 0000950134-08-012468).
   10.15       Registration statement for the U.S. Global Investors, Inc. Employee Stock Purchase Plan, as amended April 28, 2009, incorporated by reference, filed April 30, 2009 (EDGAR Accession No. 0000950134-09-008950).
   10.16       Note Modification Agreement dated February 28, 2012, by and between the Company and JPMorgan Chase Bank, N.A., included herein.
   14.01       Code of Ethics for Principal Executive and Senior Financial Officers, adopted December 15, 2003, and amended February 23, 2009, incorporated by reference, filed on September 10, 2009 (EDGAR Accession No. 0000950123-09-042459).
   14.02       Code of Ethics, adopted June 28, 1989, and amended December 12, 2008, incorporated by reference, filed on September 10, 2009 (EDGAR Accession No. 0000950123-09-042459).
   21       List of Subsidiaries of the Company, included herein.
   23.1       BDO USA, LLP consent of independent registered public accounting firm for Form 10-K for U.S. Global Investors, Inc., included herein.
   24       Power of Attorney, incorporated by reference to Annual Report on Form 10-K for fiscal year ended June 30, 2001 (EDGAR Accession No. 0000754811-01-500016).
   31.1       Rule 13a-14(a) Certifications (under Section 302 of the Sarbanes-Oxley Act of 2002), included herein.
   32.1       Section 1350 Certifications (under Section 906 of the Sarbanes-Oxley Act of 2002), included herein.
   101.INS       XBRL Instance Document
   101.SCH       XBRL Taxonomy Extension Schema Document
   101.CAL       XBRL Taxonomy Extension Calculation Linkbase Document
   101.DEF       XBRL Taxonomy Extension Definition Linkbase Document
   101.LAB       XBRL Taxonomy Extension Labels Linkbase Document
   101.PRE       XBRL Taxonomy Extension Presentation Linkbase Document
SIGNATURE    CAPACITY IN WHICH SIGNED   DATE

/s/ Frank E. Holmes

     
FRANK E. HOLMES   

Chief Executive Officer

Chief Investment Officer

Director

   August 29, 2012

* /s/ Thomas F. Lydon, Jr.

     
THOMAS F. LYDON, JR.    Director   August 29, 2012

* /s/ Jerold H. Rubinstein

     
JEROLD H. RUBINSTEIN    Chairman, Board of Directors   August 29, 2012

* /s/ Roy D. Terracina

     
ROY D. TERRACINA    Director   August 29, 2012

/s/ Catherine A. Rademacher

     
CATHERINE A. RADEMACHER    Chief Financial Officer   August 29, 2012

*BY: /s/ Susan B. McGee

     

Susan B. McGee

Attorney-in-Fact under

Power of Attorney dated

September 26, 2001

      August 29, 2012