EXHIBIT 13

 Wells-Gardner Electronics Corporation

 2001 Annual Report


<TABLE>

 SELECTED FINANCIAL DATA

 (in $000's except for per share data)

                                                      Years Ended December 31,
                                          2001       2000       1999       1998       1997
 ------------------------------------------------------------------------------------------
 <S>                                    <C>        <C>        <C>        <C>        <C>
 Net sales                              $42,550    $46,464    $35,714    $40,604    $42,989
 Moving related costs                     1,334        ---        ---        ---        ---
 Operating earnings (loss)               (2,372)     1,320       (612)     1,449      1,124
 Gain on sale of fixed assets               ---        329        ---        ---        ---
 Earnings (loss) from continuing
   operations                            (2,894)     1,092       (838)     1,075        775
 ------------------------------------------------------------------------------------------
 Loss on discontinued operations         (2,813)      (241)      (352)      (101)       ---
 ------------------------------------------------------------------------------------------
 Net earnings (loss)                    ($5,707)      $851    ($1,190)      $974       $775
 ------------------------------------------------------------------------------------------
 Per share data:
 Basic net earnings (loss) from
  continuing operations                  ($0.57)     $0.21     ($0.17)     $0.22      $0.16
 Diluted net earnings (loss)
  from continuing operations             ($0.57)     $0.21     ($0.17)     $0.21      $0.15
 ------------------------------------------------------------------------------------------

 Total assets                           $21,575    $26,076    $18,789    $19,671    $17,520
 Long-term liabilities                   $8,925     $7,852     $3,576     $2,736     $1,800
 Working capital                        $11,281    $15,377    $10,481    $10,199    $10,915
 ------------------------------------------------------------------------------------------
</TABLE>

 COMMON SHARE MARKET PRICE

 The Company's common shares are traded on the American Stock Exchange  under
 the symbol WGA.  On December 31, 2001, there were approximately  664 holders
 of record of the common shares.  A five percent (5%) stock dividend was paid
 in 2001 and 2000.  High and low prices for the last two years were:

                                ---------------------------------------------
                                    2001 Prices                2000 Prices
                                High           Low          High         Low
 ----------------------------------------------------------------------------
 Quarter ended:
    March 31,                   2.70          2.15          5.00         3.00
    June 30,                    3.95          2.50          4.00         2.75
    September 30,               4.05          2.25          3.25         2.13
    December 31,                2.95          2.05          2.69         1.50
 ----------------------------------------------------------------------------


 PRESIDENT'S REPORT 2001

 TO OUR SHAREHOLDERS, CUSTOMERS, SUPPLIERS & EMPLOYEES:

 This has been a  year of enormous  change for the  Company, during which  we
 invested in our future and accomplished the following:

      We consolidated our management control of American Gaming & Electronics
      ("AGE").

      We developed a high quality Malaysian based management team to manage
      our 50/50 manufacturing joint venture, Wells Eastern Asia Displays
      ("WEA") based in Kedah, Malaysia.

      We moved our US plant and headquarters for the first time in 65 years
      to a new, highly efficient facility in the Chicago area, which is half
      the size of our original plant.

      We implemented a new Oracle ERP system, which we needed to network our
      4 US facilities and upgrade our IT capabilities.

      We sold the Coin business that no longer fit the strategic direction of
      the Company.

 All of the above  actions were a continuation  of the implementation of  the
 strategic plan announced last year.


 Strategic Plan for the 21st Century

 We announced in  July 2000  our new strategy  for the  21st Century.  Wells-
 Gardner has now transitioned from a  US based manufacturer primarily to  the
 low growth amusement  market to a  global manufacturing,  service and  parts
 distribution Company to the fast growing  gaming market. An integral  aspect
 of this strategy is to grow the more profitable parts and service business.

 American Gaming & Electronics (AGE)

 We acquired  AGE  in January  2000  and established  it  as a  wholly  owned
 subsidiary. We  have  sales  operations in  Las  Vegas,  Reno,  New  Jersey,
 California, Florida  and  Illinois.  We  are  expanding  into  other  gaming
 jurisdictions in  North  and  South  America.  We  have  major  distribution
 relationships with  JCM, 3MTouch,  Ithica, Starpoint,  Money Controls,  Coin
 Mech and  others. We  signed contracts  to install  some manufacturers'  new
 gaming devices in New Jersey and  Connecticut.  We also purchase,  refurbish
 and market  used gaming  devices out  of  our New  Jersey facility  to  both
 national and international customers.

 Wells Eastern Asia Displays (WEA)

 In January 2000 we established WEA, our 50/50 joint venture in Malaysia with
 Eastern Asia Technology Limited of Singapore, a public company traded on the
 Singapore stock  exchange.  This production  facility  is essential  to  our
 strategy of being a globally competitive manufacturer of video monitors.  We
 manufacture our long run monitors at WEA,  many of which are for the  gaming
 market. We produced  29,600 monitors  at WEA in  2001, which  was more  than
 double the 2000 production of 13,200 monitors.

 Gaming Strategy

 Wells-Gardner is  continuing its  strategy of  using  its strengths  in  one
 segment of the  gaming market  to leverage  itself and  increase its  market
 penetration  in  other  segments  of  the  gaming  market.  The  Company  is
 participating in five segments of the gaming market:

        Monitor manufacturing in Malaysia and the US for the gaming market.
        Distributing  Wells-Gardner's  and  other  manufacturers'  parts   to
        casinos throughout North America.

        Servicing  games  and  games  parts  for  casinos  throughout   North
        America.

        Installing and servicing  new gaming equipment into casinos in  North
        America.

        Refurbishing and  selling used gaming  equipment to customers  world-
        wide.

 The  strategy  is  proving  successful  as  gaming  revenue  accounted   for
 approximately 60 percent of the Company's total revenue in 2001, up from 52%
 in 2000.

 Parts and Service Strategy

 A  major  and  critical  aspect of the  21st Century strategy is to grow the
 more profitable  parts and  service  business.  This  revenue  accounted for
 approximately 27 percent of  the Company's 2001  total revenue, compared  to
 1.5 percent  in 1994.  This is  an  annual growth  rate  of 54  percent.  In
 addition, the average margin on this business is more than double the margin
 of the rest of the business.

 2001 Sales Declined Primarily Due to a Reduction in the Amusement Market

 2001 sales were $42.6 million, down  8.4 percent or $3.9 million from  $46.5
 million in 2000.  The decline was  primarily caused by  a reduction of  $4.7
 million in  sales  to  our  largest amusement  customer  of  2000,  whom  we
 previously disclosed had  exited our market  during 2001.  In addition,  the
 general state  of the  economy and  the impact  of the  September 11  events
 depressed sales in the gaming markets  we serve, particularly in the last  4
 months.

 The International Sales Strategy Paid Dividends

 The international sales  strategy paid dividends  in 2001  when the  Company
 received a 3-year exclusive  manufacturing contract valued at  approximately
 $12 million per  year to supply  digital monitors to  a major  international
 gaming manufacturer. This company will become our largest customer in  2002.
 In addition the Company  is supplying other  international customers and  is
 expecting its  international sales  of monitors  to grow  at a  considerably
 faster rate than its US sales.

 The Company Invested Heavily in 2001

 The Company invested heavily in 2001  by implementing the actions  described
 above. A loss  was recorded  for 2001  of $5.7  million or  $1.12 per  share
 compared to a profit $851,000 or $0.16  per share in 2000, which included  a
 non-recurring gain on  the sale of  assets of $329,000  or $0.07 per  share.
 Included in the 2001 results were two non-recurring charges associated  with
 our efforts to reposition the Company for the future.  These included:

           The cost of moving  the Company's plant  and headquarters of  $1.3
           million or $0.26 per share

           The loss associated with the discontinuation of the Company's Coin
           business of $2.8 million or $0.55 per share.


 Digital Product Line

 Wells-Gardner continued to market a full  line of digital products for  both
 the gaming  and amusement  markets. We  will be  able to  manufacture  these
 products in both Malaysia and the  US. We have a competitive advantage  over
 most of our major competitors, and we believe that we could become a  market
 leader in video monitors to the gaming industry by the end of 2002.  Already
 we have obtained  business from several  new customers based  entirely on  a
 combination of  our  digital capability  and  our Asian  manufacturing  cost
 advantage.

 Quality Continues To Be The Top Priority

 Wells-Gardner  remains  committed  to  being  the  "best-in-class"   quality
 supplier  in  all  our served  markets.  The  Company  became  a  "certified
 supplier" to one of our major gaming customers, which is an important  third
 party endorsement of our quality approach.


 2002 Outlook

 Wells-Gardner made  several  major investments  in  2001 and  is  poised  to
 maximize its  opportunities  in  the growing  gaming  market,  both  through
 monitor sales and  sales of  parts, service  and used  gaming devices  sales
 through AGE. The Company is also  moving a substantial amount of  production
 to  WEA  in  Malaysia,  which  is  expected  to  improve  profitability  and
 competitiveness. The  major  risk is  the  worldwide economy  and  uncertain
 political climate.

 We thank  all  of  you  for  your  continued  support  as  we  complete  the
 implementation of our strategic plan. We  are confident that this will  lead
 to increased profitability and improved shareholder value.


 Anthony Spier
 Chairman of the Board, President
 & Chief Executive Officer

 March 8, 2002

<PAGE>


 MANAGEMENTS DISCUSSION  &  ANALYSIS  OF FINANCIAL  CONDITION  &  RESULTS  OF
 OPERATIONS

 Year Ended December 31, 2001 Compared to Year Ended December 31, 2000

 Net sales from continuing operations decreased 8.4% to $42.6 million in 2001
 compared to $46.5  million in 2000,  as gross margin  for 2001 decreased  to
 $7.4 million or 17.4% of sales compared to $9.5 million or 20.5% of sales in
 2000.  The decline was  primarily caused by a  reduction of $4.7 million  of
 sales to  our largest  amusement customer  of 2000,  who exited  our  market
 during 2001. In addition the general state of the economy and the impact  of
 the September 11 events depressed sales particularly in the last 4 months in
 the  gaming  markets  we  serve.  Engineering,  selling  and  administrative
 expenses increased to $8.4 million in 2001 compared to $8.2 million in 2000.
 The increase is attributed to the  operating expenses incurred for  American
 Gaming  and  Electronics   and  the  Company's   initiative  to  invest   in
 international  sales  and  new  product  development.  Operating  loss  from
 continuing operations for 2001 was $2.4 million compared to operating income
 from continuing  operations of  $1.3 million  in 2000.   During  the  second
 quarter of 2001, the Company moved  its Chicago based operations to  McCook,
 Illinois  which  resulted  in  a  charge  to  operations  of  $1.3  million.
 Additionally, during the  fourth quarter of  2001, the Company  discontinued
 its coin door  business and recorded  a loss on  discontinued operations  of
 $2.8 million, which included a loss  on disposal of assets of $2.4  million.
 During the first  quarter of  2000, the  Company sold  its headquarters  and
 recognized a gain on the sale of  fixed assets of $329,000.  Other  expense,
 net was  $522,000  in 2001  compared  to $549,000  in  2000 as  the  Company
 incurred interest expense  to fund the  facility move  and fund  operations.
 The Company did not record  an income tax provision  in 2001 compared to  an
 $8,000  income  tax provision  in 2000.  The  Company  has available  a  net
 operating loss carryforward  of approximately $8.9  million at December  31,
 2001.   Net loss  for 2001  was $5.7  million compared  to a  net profit  of
 $851,000 in 2000.   For 2001, basic  and diluted loss  per share was  $1.12,
 compared to basic and diluted earnings per share of 16 cents for 2000.

 Year Ended December 31, 2000 Compared to Year Ended December 31, 1999

 Net sales from  continuing operations increased  30.1% to  $46.5 million  in
 2000 compared to $35.7 million in  1999, as gross margin for 2000  increased
 to $9.5 million or 20.5% of sales compared to $4.6 million or 13.0% of sales
 in 1999.   This  increase is  attributed  to sales  and margin  recorded  in
 connection with the Company's January,  2000 acquisition of American  Gaming
 and Electronics.  Engineering, selling and administrative expenses increased
 to $8.2 million in 2000  compared to $5.3 million  in 1999. The increase  is
 attributed to  the  operating  expenses incurred  for  American  Gaming  and
 Electronics.  Operating income from continuing operations for 2000 was  $1.3
 million  compared  to  an  operating  loss  from  continuing  operations  of
 $612,000 in 1999.  During the  first quarter of 2000,  the  Company sold its
 headquarters and recognized a gain on the sale of fixed assets of  $329,000.
 Other expense, net was $549,000 in 2000 compared to $226,000 in 1999 as  the
 Company incurred additional debt financing and interest expense to fund  the
 acquisition of American  Gaming and Electronics.   The  Company recorded  an
 $8,000 and $0 income  tax provision in 2000  and 1999, respectively, as  the
 Company has available  a net  operating loss  carryforward of  approximately
 $3.1 million at  December 31,  2000.  Net  earnings for  2000 were  $851,000
 compared to a net loss of $1.2 million in 1999.  For 2000, basic and diluted
 earnings per share  was 16  cents, compared to  basic and  diluted loss  per
 share of 24 cents for 1999.

 On January 4, 2000, the Company announced that it entered into a 50/50 joint
 venture with Eastern  Asia Technology Limited  of Singapore  to produce  and
 manufacture a full line of open frame video monitors in Malaysia.  The joint
 venture is accounted for under the equity method.  On January 12, 2000,  the
 Company acquired certain assets  of American Gaming  and Electronics of  Las
 Vegas, New  Jersey and  Florida.   American Gaming  and Electronics  is  the
 largest independent  distributor  of  gaming parts  and  services  in  North
 America and is operated as a wholly owned subsidiary.

 Market and Credit Risks

 The Company  is subject  to certain  market  risks, mainly  interest  rates.
 During 2001, the  Company entered into  a two-year,  $15.7 million,  secured
 credit facility with  American National  Bank.   At December  31, 2001,  the
 Company had total outstanding bank debt of $10.1 million, which consisted of
 $5.9 million on its revolving  line of credit at  an interest rate of  5.00%
 and $4.2 million on its installment term note at an interest rate of  6.25%.
 The Company believes that its exposure to interest rate fluctuations will be
 limited due to the Company's practice of maintaining a minimal cash  balance
 in an effort to effectively use any excess cash flows to reduce  outstanding
 debt.  All of the Company's debt is subject to variable interest rates.   An
 adverse change  in  interest  rates  during  the  time  that  this  debt  is
 outstanding would cause  an increase in  the amount of  interest paid.   The
 Company may pay down the loans at any time without penalty.  However, a  100
 basis point increase in interest rates would result in an annual increase of
 approximately $101,000  in  interest  expense recognized  in  the  financial
 statements.

 The Company is exposed to credit risk on certain assets, primarily  accounts
 receivable.  The Company provides credit to customers in the ordinary course
 of business  and performs  ongoing credit  evaluations.   Concentrations  of
 credit risk with respect  to trade receivables are  somewhat limited due  to
 the large number of customers comprising  the Company's customer base.   The
 Company currently believes its allowance for doubtful accounts is sufficient
 to cover customer credit risks.

 Liquidity & Capital Resources

 Accounts receivable  decreased to  $5.9 million  in  2001 compared  to  $7.7
 million in 2000.  This decrease is  attributed to lower sales in the  fourth
 quarter of 2001.  Inventory decreased  to $10.0 million in 2001 compared  to
 $11.9 million in 2000.  This decrease is attributed to the Company's ongoing
 effort to minimize its  on hand inventory at  its domestic based  locations,
 which was partially  offset as  the Company  held $1.6  million overseas  to
 support its  international  gaming  customer.   Overall  domestic  inventory
 decreased $3.5 million from year-end 2000.   Other current assets  decreased
 to $632,000 in 2001 from $1.2  million in 2000.  Intangibles, net  decreased
 to $1.3 million in 2001 from $2.8 million in 2000, as the Company wrote  off
 $1.9 million  of  goodwill,  which related  to  the  discontinuance  of  the
 Company's  coin  door  division.  Partially  offsetting  this  decrease  was
 additional goodwill of $700,000 recorded in the first quarter 2001 for earn-
 out payments made to the previous owners of American Gaming and Electronics.
 Total liabilities  increased to  $14.4 million  in  2001 compared  to  $13.4
 million in 2000. This increase is  attributed to increased borrowing on  the
 Company's line of credit.  Shareholders' equity decreased to $7.2 million in
 2001 from $12.7  million in 2000.   Under its  current credit facility,  the
 Company is  required  to maintain  certain  financial covenants.  While  the
 Company currently expects to meet these financial covenants during 2002, its
 liquidity could be adversely affected  if it is unable  to do so.   Overall,
 the Company believes that its future financial requirements can be met  with
 funds generated  from  operating activities  and  from its  credit  facility
 during the foreseeable future.

 Recently Issued Accounting Pronouncements

 In July 2001, the Financial Accounting Standards Board issued SFAS No.  141,
 "Business Combinations"  and SFAS  No. 142  "Goodwill and  Other  Intangible
 Assets."  SFS No. 141 requires the purchase method of accounting to be  used
 for all business combinations  initiated after June 30,  2001.  The  Company
 does not  expect  SFAS No.  141  to significantly  impact  its  consolidated
 financial statements.  SFAS No. 142 changes the accounting of goodwill  from
 an amortization method to an impairment-only  approach.  Goodwill and  other
 intangible assets that have  an indefinite life will  not be amortized,  but
 rather will be tested  for impairment annually or  whenever an event  occurs
 indicating  that  the  asset  may  be  impaired.   Management  is  currently
 evaluating the  impact  that adoption  of  SFAS No.  142  will have  on  the
 consolidated financial statements.

 Inflation

 During the past three years, management believes that inflation has not  had
 a material effect on the Company's results of operations.

<PAGE>
<TABLE>

 CONSOLIDATED BALANCE SHEETS

 Years ended December 31,
 (in $000's except for share information)
                                                          -------------------
                                                             2001       2000
 ----------------------------------------------------------------------------
 <S>                                                      <C>         <C>
 ASSETS
 Current Assets:
   Cash & cash equivalents                                   $159         $85
   Accounts receivable, net of allowances
     of $130 in 2001, & $70 in 2000                         5,924       7,746
   Inventory                                               10,011      11,875
   Prepaid expenses & other assets                            632       1,186
 ----------------------------------------------------------------------------
          Total current assets                            $16,726     $20,892
 ----------------------------------------------------------------------------

 Property, Plant & Equipment (at cost):
   Leasehold improvements                                     267          12
   Machinery, equipment & software                          8,826       7,949
   less: Accumulated depreciation & amortization           (5,869)     (5,677)
 ----------------------------------------------------------------------------
           Property, plant & equipment, net                $3,224      $2,284
 ----------------------------------------------------------------------------

 Other Assets:
   Investment in joint venture                                296         142
   Intangibles, net                                         1,329       2,758
 ----------------------------------------------------------------------------
           Total other assets                              $1,625      $2,900
 ----------------------------------------------------------------------------
           Total Assets                                   $21,575     $26,076
 ----------------------------------------------------------------------------


 LIABILITIES & SHAREHOLDERS' EQUITY
 Current Liabilities:
   Accounts payable                                         3,814       4,173
   Accrued expenses                                           431         672
   Installment term note payable                            1,200         670
 ----------------------------------------------------------------------------
           Total current liabilities                       $5,445      $5,515
 ----------------------------------------------------------------------------

 Long-Term Liabilities:
   Note payable                                             5,912       6,456
   Installment term note payable                            3,013       1,396
 ----------------------------------------------------------------------------
           Total long-term liabilities                     $8,925      $7,852
 ----------------------------------------------------------------------------
           Total Liabilities                              $14,370     $13,367
 ----------------------------------------------------------------------------

 Shareholders' Equity:
   Common shares:
     $1 par value; 25,000,000 shares authorized;
     5,271,935 shares issued at December 31, 2001
     4,897,869 shares issued at December 31, 2000           5,272       4,898
   Capital in excess of par value                           3,319       2,763
   Retained earnings (deficit)                             (1,135)       5,213
   Unearned compensation                                     (251)       (165)
 ----------------------------------------------------------------------------
           Total Shareholders' Equity                      $7,205     $12,709
 ----------------------------------------------------------------------------
           Total Liabilities & Shareholders' Equity       $21,575     $26,076
 ----------------------------------------------------------------------------

See accompanying notes to the consolidated financial statements

</TABLE>
<PAGE>
<TABLE>

 CONSOLIDATED STATEMENTS OF OPERATIONS

 Years ended December 31,
 (in $000's except for share & per share data)
                                                  ---------------------------
                                                    2001      2000     1999
 ----------------------------------------------------------------------------
 <S>                                              <C>       <C>       <C>
 Net sales                                        $42,550   $46,464   $35,714
 Cost & expenses:
   Cost of sales                                   35,136    36,924    31,073
   Engineering, selling & administrative            8,352     8,155     5,253
   Goodwill amortization                              100        65       ---
   Moving related costs                             1,334       ---       ---
 ----------------------------------------------------------------------------
 Operating earnings (loss)                         (2,372)    1,320      (612)
   Gain on sale of fixed assets                       ---       329       ---
   Other expense, net                                 522       549       226
 ----------------------------------------------------------------------------
 Earnings (loss) from continuing operations
   before income tax                               (2,894)    1,100      (838)
   Income tax                                         ---         8       ---
 ----------------------------------------------------------------------------
 Earnings (loss) from continuing operations        (2,894)    1,092      (838)
 Loss on discontinued operations (including
   loss on disposal of $2,394 in 2001)             (2,813)     (241)     (352)
 ----------------------------------------------------------------------------
 Net earnings (loss)                              ($5,707)     $851   ($1,190)
 ----------------------------------------------------------------------------

 Basic earnings (loss) per common share:
   Continuing operations                           ($0.57)    $0.21    ($0.17)
   Discontinued operations                          $0.55     $0.05     $0.07
 ----------------------------------------------------------------------------
 Basic earnings (loss) per common share            ($1.12)    $0.16    ($0.24)
 ----------------------------------------------------------------------------

 Diluted earnings (loss) per common share:
   Continuing operations                           ($0.57)    $0.21    ($0.17)
   Discontinued operations                          $0.55     $0.05     $0.07
 ----------------------------------------------------------------------------
 Diluted earnings (loss) per common share          ($1.12)    $0.16    ($0.24)
 ----------------------------------------------------------------------------

 Basic average common shares outstanding        5,119,405 5,164,339 4,980,535

 Diluted average common shares outstanding      5,119,405 5,250,395 4,980,535
 ----------------------------------------------------------------------------

</TABLE>
<PAGE>
<TABLE>

 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
 (in $000's)
                                          ---------------------------------------------------------
                                                  Capital In  Retained                   Total
                                          Common   Excess Of  Earnings     Unearned   Shareholders'
                                          Shares   Par Value  (Deficit)  Compensation    Equity
 --------------------------------------------------------------------------------------------------
 <S>                                      <C>        <C>       <C>           <C>         <C>
 December 31, 1998                        $4,286     $1,527    $6,907         ---        $12,720

 Net loss                                    ---        ---    (1,190)        ---         (1,190)
 Stock dividend issued                       215        254      (469)        ---            ---
 Issuance of stock awards                     30         63       ---         ---             93
 Shares issued from stock purchase plan       12         24       ---         ---             36
 Stock options exercised                       1          1       ---         ---              2
 --------------------------------------------------------------------------------------------------
 December 31, 1999                        $4,544     $1,869    $5,248         ---        $11,661
 --------------------------------------------------------------------------------------------------

 Net earnings                                ---        ---       851         ---            851
 Stock dividend issued                       229        657      (886)        ---            ---
 Issuance of stock awards                     86        173       ---        (180)            79
 Shares issued from stock purchase plan       12         24       ---         ---             36
 Stock options exercised                      27         40       ---         ---             67
 Amortization of unearned compensation       ---        ---       ---          15             15
 --------------------------------------------------------------------------------------------------
 December 31, 2000                        $4,898     $2,763    $5,213       ($165)       $12,709
 --------------------------------------------------------------------------------------------------

 Net loss                                    ---        ---    (5,707)        ---         (5,707)
 Stock dividend issued                       242        399      (641)        ---            ---
 Issuance of stock awards                     76        103       ---        (126)            53
 Shares issued from stock purchase plan       12         22       ---         ---             34
 Stock options exercised                      44         32       ---         ---             76
 Amortization of unearned compensation       ---        ---       ---          40             40
 --------------------------------------------------------------------------------------------------
 December 31, 2001                        $5,272     $3,319   ($1,135)      ($251)        $7,205
 --------------------------------------------------------------------------------------------------

 See accompanying notes to the consolidated financial statements.

</TABLE>
<PAGE>
<TABLE>

 CONSOLIDATED STATEMENTS OF CASH FLOWS
 Years ended December 31,
 (in $000's)

                                                  ---------------------------
                                                    2001      2000     1999
 ----------------------------------------------------------------------------
 <S>                                              <C>       <C>       <C>

 Cash flows from operating activities:
   Net earnings (loss)                            ($5,707)     $851   ($1,190)
 Adjustments to reconcile net earnings
   (loss) to net cash provided by (used in)
   operating activities:
   Loss on sale of discontinued operations          2,394       ---       ---
   Depreciation & amortization                        764       586       647
   Amortization of unearned compensation               40        15       ---
   Gain on sale of fixed assets                       ---      (329)      ---
   Share of (gain) / loss in joint venture           (154)       64       ---
 Changes in current assets & liabilities
   (net of effects of acquisitions):
 Accounts receivable                                1,822    (2,196)      353
 Note receivable                                      ---       ---       488
 Inventory                                          1,435    (2,522)       69
 Prepaid expenses & other                             554      (571)     (181)
 Accounts payable                                    (359)    1,703      (420)
 Accrued expenses                                    (241)     (190)     (298)
 ----------------------------------------------------------------------------
 Net cash provided by (used in) operating
  activities                                         $548   ($2,589)    ($532)
 ----------------------------------------------------------------------------

 Cash used in investing activities:
   Payments for acquisitions, net of cash
     acquired                                        (700)   (1,975)      ---
   Proceeds from sale of fixed assets                 ---     1,499       ---
   Net proceeds from sale of discontinued
     operations                                       152       ---       ---
   Additions to property, plant & equipment        (1,692)   (1,427)     (401)
 ----------------------------------------------------------------------------
 Net cash used in investing activities            ($2,240)  ($1,903)    ($401)
 ----------------------------------------------------------------------------

 Cash provided by financing activities:
   Net borrowings from note payable                 1,603     4,276       896
   Proceeds from options exercised &
     purchase plan                                    163       182       130
 ----------------------------------------------------------------------------
 Net cash provided by financing activities         $1,766    $4,458    $1,026
 ----------------------------------------------------------------------------

 Net increase (decrease) in cash & cash
   equivalents                                         74       (34)       93
 Cash & cash equivalents at beginning of year          85       119        26
 ----------------------------------------------------------------------------
 Cash & cash equivalents at end of year              $159       $85      $119
 ----------------------------------------------------------------------------

 Supplemental cash flows disclosure:
   Income taxes paid                                  ---        $8       ---
   Interest paid                                     $739      $673      $408

 Supplemental schedule of non-cash activities:
   Investment in joint venture                        ---      $200       ---
 ----------------------------------------------------------------------------

 See accompanying notes to the consolidated financial statements.
</TABLE>
<PAGE>


 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS


 Note 1.  DESCRIPTION OF THE BUSINESS

 Wells-Gardner  Electronics   is   a   sales,   service,   distribution   and
 manufacturing company  that  primarily  services the  gaming  and  amusement
 markets, with  facilities in  the United  States and  a manufacturing  joint
 venture in Malaysia.


 Note 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 Principles of Consolidation

 The consolidated financial statements  of the Company  at December 31,  2001
 include the  accounts  of  Wells-Gardner  Electronics  Corporation  and  its
 wholly-owned subsidiary, American  Gaming and  Electronics. All  significant
 intercompany   accounts   and   transactions   have   been   eliminated   in
 consolidation.

 Cash & Cash Equivalents

 For purposes of reporting cash flows, cash and cash equivalents include cash
 on hand, commercial paper, certificates of  deposit and money market  funds,
 which have an original maturity of three months or less.

 Financial Instruments

 The fair value of  the Company's financial  instruments does not  materially
 vary from the carrying value of such instruments.

 Inventory

 Inventory is stated at the lower of cost (first-in, first-out) or market.

 Property, Plant & Equipment

 Property, plant and  equipment are stated  at cost and  are depreciated  and
 amortized for financial reporting purposes  over the estimated useful  lives
 on a straight-line basis as follows: machinery & equipment - five to fifteen
 years & leasehold improvements - shorter  of lease term or estimated  useful
 life.

 Internal Use Software

 The Company  has  adopted the  provisions  of Statement  of  Position  98-1,
 "Accounting for the  Costs of Software  Developed or  Obtained for  Internal
 Use."  Accordingly, certain costs incurred  in the planning and  development
 stage of internal use computer software  projects are expensed, while  costs
 incurred  during  the   application  development   stage  are   capitalized.
 Capitalized software costs are amortized over the expected economic life  of
 the software.   Total net capitalized costs as of December 31, 2001 and 2000
 were $1.4  million  and  $1.2 million,  respectively  and  are  included  in
 property, plant & equipment on the  face of the consolidated balance  sheet.
 During the  years ended  December 31,  2001 and  2000, amortization  expense
 related to the capitalized software was $200,000 and $0 respectively.

 Long-Lived Assets

 Long-lived assets to be held and  used are reviewed for impairment  whenever
 events or changes in circumstances indicate that the carrying amounts should
 be evaluated.  Impairment is measured by comparing the carrying value to the
 estimated undiscounted future cash flows expected to result from the use  of
 the assets and their eventual disposition.   The Company has determined,  on
 the basis that there are no indicators,  that as of December 31, 2001  there
 has been no impairment in the carrying values of long-lived assets.

 Investments

 The Company's joint  venture is  accounted for  under the  equity method  of
 accounting in accordance with Accounting Principles Board (APB) No. 18, "The
 Equity Method of Accounting  for Investments in Common  Stock."  Under  this
 method, the investment is adjusted to  recognize the Company's share of  the
 income or losses in the joint venture.  Write downs are recognized when  the
 Company believes that a permanent impairment in value has occurred.

 Intangibles

 Intangible assets consist primarily of the  cost of purchased businesses  in
 excess of the  fair value  of net  assets acquired  and are  amortized on  a
 straight-line basis over  periods of  five and  twenty years.   The  Company
 regularly reviews the performance of the  acquired business to evaluate  the
 realizability of the underlying goodwill.  Amortization expense relating  to
 continuing operations in  2001, 2000  and 1999  was approximately  $100,000,
 $65,000 and $0 respectively.  In 2001, the Company wrote off $1.9 million of
 net intangible  assets  related  to its  discontinuance  of  the  coin  door
 division.

 Revenue Recognition

 Revenue from sales of products is recorded at time of shipment.

 Significant Customers

 Approximately 10%,  21%  and  32% of  net  sales  in 2001,  2000  and  1999,
 respectively, were to the Company's largest customer.

 Earnings (Loss) Per Share

 Basic earnings (loss) per share is  based on the weighted average number  of
 shares outstanding whereas diluted earnings per share includes the  dilutive
 effect  of  unexercised common  stock options.  For  all  periods  reported,
 earnings per share  have been retroactively  restated to  reflect the  stock
 dividends issued in 2001, 2000 and 1999.

 Research & Development

 Research and development costs for the  years ended December 31, 2001,  2000
 and  1999  were   approximately  $1,260,000,   $1,344,000  and   $1,261,000,
 respectively, which were 2.9%, 2.9% and 3.5% of annual sales from continuing
 operations, respectively.

 Reclassifications

 Certain  amounts  in  previously  issued  financial  statements  have   been
 reclassified to conform to the current year's presentation.

 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, the  disclosure of contingent assets  and
 liabilities at the date of the financial statements and reported amounts  of
 revenues and expenses  during the reporting  period.   Actual results  could
 differ from those estimates.


 Note 3.  RELATED-PARTY TRANSACTIONS

 During the period 1999 to 2001, a  portion of the Company's sales were  made
 through a sales representative firm,  James Industries Inc., whose  Chairman
 and principal shareholder  is a  substantial beneficial  shareholder of  the
 Company.  Commissions earned  by James Industries Inc.  for the years  ended
 December 31, 2001, 2000 and 1999  were approximately $587,000, $965,000  and
 $1,076,000, respectively.  Commissions owed to  James Industries Inc. as  of
 December 31, 2001,  2000 and 1999  were approximately  $61,000, $55,000  and
 $72,000 respectively.   Total  commissions as  a  percentage of  sales  from
 continuing operations for the years ended  December 31, 2001, 2000 and  1999
 were 1.4%, 2.1% and 3.0%, respectively.  Sales to James Industries Inc.  for
 the years ended December 31, 2001, 2000 and 1999 were approximately $16,000,
 $108,000 and $261,000,  respectively.  Outstanding  accounts receivable  due
 from James  Industries  Inc.  at  December 31,  2001,  2000  and  1999  were
 approximately $2,000, $2,000 and $99,000, respectively.


 Note 4.  INVENTORY

 Inventory consisted of the following components:

 -------------------------------------------------
                                 December 31,
                              --------------------
 (in $000's)                  2001           2000
 -------------------------------------------------
 Raw materials               $5,405         $5,616
 Work in progress               994          1,059
 Finished goods               3,612          5,200
 -------------------------------------------------
                   Total    $10,011        $11,875
 -------------------------------------------------


 Note 5.  DEBT

 During 2001, the  Company entered into  a two-year,  $15.7 million,  secured
 credit facility with American  National Bank.   Substantially all assets  of
 the Company are used as collateral for this credit facility. At December 31,
 2001, the Company  had total outstanding  bank debt of  $10.1 million  which
 consisted of $5.9 million on a revolving line of credit at an interest  rate
 of 5.00% and $4.2 million on a installment term note at an interest rate  of
 6.25%.  The  installment term note  is being repaid  with monthly  principal
 payments of $100,000. All remaining bank  debt is due and payable on  August
 31, 2003.


 Note 6.  STOCK PLANS

 The Company  maintains a  Non-Qualified Option  and Stock  Award Plan  under
 which officers and key  employees may acquire up  to a maximum of  1,620,675
 common shares and a  Nonemployee Director Stock  Plan under which  directors
 may acquire  up to  289,406 common  shares.   Options  may be  granted  thru
 December 31, 2008 at an option price not less than fair market value on  the
 date of grant and are exercisable not earlier than six months nor later than
 ten years from  the date of  grant.  Options  vest over two  and three  year
 periods.  As of December 31,  2001, 46 persons held outstanding options  and
 were eligible to participate in the  plans.  Such options expire on  various
 dates through May 1, 2011.

 The Company  applies  APB Opinion  No.  25 and  related  interpretations  in
 accounting for  its  plans.   Accordingly,  no compensation  cost  has  been
 recognized for its fixed stock option plans.  Had compensation cost for  the
 Company's stock option plans been determined consistent with FASB  Statement
 of Financial Accounting  Standards No. 123  ("FAS 123"),  the Company's  net
 earnings (loss) available to common shareholders and net earnings (loss) per
 common share would have been as follows for the years ended December 31:


 ----------------------------------------------------------------------------
 (in $000's except per share data)         2001       2000        1999
 ----------------------------------------------------------------------------
 Net earnings (loss) available to
   common shareholders:
                         As reported     ($5,707)      $851     ($1,190)
                           Pro forma      (5,890)       719      (1,301)
 Net earnings (loss) per common and
   common equivalent share:
                   Basic as reported      ($1.12)     $0.16      ($0.24)
                 Diluted as reported       (1.12)      0.16       (0.24)
                  Pro forma -  Basic       (1.12)      0.16       (0.24)

                 Pro forma - Diluted       (1.12)      0.16       (0.24)
 ----------------------------------------------------------------------------

 Under the stock option plans, the  exercise price of each option equals  the
 market price of the Company's stock on the  date of grant.  For purposes  of
 calculating the compensation cost consistent with FAS 123, the fair value of
 each grant is estimated on the date of grant using the Black-Scholes option-
 pricing model  with  the  following weighted-average  assumptions  used  for
 grants in fiscal 2001, 2000 and  1999, respectively: expected volatility  of
 33 percent;  risk  free interest  rates  ranging  from 6.7  percent  to  4.8
 percent; and expected lives  of 5 years.   Additional information on  shares
 subject to options is as follows:

 -----------------------------------------------------------------------------
                              2001               2000              1999
                                 Weighted           Weighted          Weighted
                                 average            average           average
                                 exercise           exercise          exercise
                        Options   price    Options   price   Options   price
 -----------------------------------------------------------------------------
 Outstanding at
   beginning of year   1,337,470  $3.32   1,162,778  $3.48    867,864  $3.98
 Granted                 230,379   2.69     298,712   3.39    334,492   2.51
 Forfeited              (196,130)  3.17     (97,202)  3.67    (38,327)  3.69
 Exercised               (71,053)  2.77     (26,818)  2.65     (1,251)  2.50
 -----------------------------------------------------------------------------
 Outstanding at end
   of year             1,300,666  $3.11   1,337,470  $3.32  1,162,778  $3.48
 -----------------------------------------------------------------------------
 Weighted average
   fair value of
   options granted                $0.66              $0.86             $1.54
 -----------------------------------------------------------------------------
 Options exercisable
   at year end           995,935            928,738           726,812
 -----------------------------------------------------------------------------

 The following table summarizes  information about stock options  outstanding
 at December 31, 2001:


                              Weighted average
    Range of        Options      remaining       Weighted average   Options
 exercise prices  outstanding  contractual life   exercise price  exercisable
 ----------------------------------------------------------------------------
  $2.22 - $2.69     516,573         7.4                $2.41         355,266
  $2.70 - $3.23     380,547         7.5                 3.16         296,108
  $3.24 - $3.99     349,054         7.6                 3.84         292,826
  $4.00 - $4.64      54,492         2.7                 4.62          51,735
 ----------------------------------------------------------------------------
                  1,300,666         7.3                $3.11         995,935
 ----------------------------------------------------------------------------

 In November 2001,  the Company granted  60,000 restricted  shares of  common
 stock to  seven employees  of the  Company.   The  employees will  earn  the
 restricted shares in  exchange for  future services  to be  provided to  the
 Company over a five year period.  The Company recorded deferred compensation
 in the  amount of  $135,000, equal  to the  market value  of the  restricted
 shares at the  date of  grant.   In July  2000, the  Company granted  60,000
 restricted shares of common stock to  seven employees and recorded  $180,000
 of deferred compensation equal to the market value of the restricted  shares
 at the date of grant.  During 2001, 4,000 shares of restricted stock granted
 in 2000 were cancelled.  The Company recorded $40,000 and $15,000 in related
 compensation expense  for  the  years ended  December  31,  2001  and  2000,
 respectively.


 Note 7.  ACCRUED EXPENSES

 Accrued expenses consisted of the following components:

 ---------------------------------------------------
                                     December 31,
                                  ------------------
 (in $000's)                      2001          2000
 ---------------------------------------------------
 Payroll & related costs          $162          $432
 Sales commissions                  61            55
 Warranty                           60            90
 Other accrued expenses            148            95
 ---------------------------------------------------
                  Total           $431          $672
 ---------------------------------------------------


 Note 8.  OTHER EXPENSE, NET

 Other expense, net consisted of the following components:

 ---------------------------------------------------
 (in $000's)                  2001     2000     1999
 ---------------------------------------------------
 Interest expense             $625     $464     $167
 Other expense, net             55      123      111
 Other income, net            (158)     (38)     (52)
 ---------------------------------------------------
     Other expense, net       $522     $549     $226
 ---------------------------------------------------


 Note 9.  INCOME TAXES

 The effective income tax rates differed from the expected Federal
 income tax rate (34%) for the following reasons:

 ----------------------------------------------------------------------------
 (in $000's)                                         2001      2000     1999
 ----------------------------------------------------------------------------
 Computed expected tax expense (benefit)           ($1,937)     $292    ($405)
 State income tax expense (benefit) net of
   Federal tax effect                                 (205)       49      (51)
 Other, net                                            (19)        1       40
 Change in valuation allowance                       2,161      (334)     416
 ----------------------------------------------------------------------------
                                                       ---        $8      ---
 ----------------------------------------------------------------------------

 Deferred income taxes reflect the impact of  temporary  differences  between
 the  amounts of assets and liabilities for financial reporting purposes  and
 as measured by income tax  regulations.  Temporary  differences  which  gave
 rise to deferred tax assets and deferred tax liabilities consisted of:

 -------------------------------------------------------------------
                                                       December 31,
                                                      --------------
 (in $000's)                                          2001      2000
 -------------------------------------------------------------------
 Deferred tax assets:
   Allowance for doubtful accounts                     $50       $35
   Warranty reserve                                     23        35
   Inventory reserve                                   153       142
   Net operating loss carryforwards                  3,379     1,190
   Alternative minimum tax credit                       73        73
     carryforwards
   General business credit carryforwards               129       129
   Other                                                43        15
 -------------------------------------------------------------------
     Total gross deferred tax assets                 3,850     1,619
     Less valuation allowance                       (3,251)   (1,090)
 -------------------------------------------------------------------
     Total deferred tax assets                        $599      $529
 Deferred tax liabilities:
   Software implementation                             448       314
   Deferred compensation                                21        36
   Property, plant & equipment, principally            130       179
     depreciation
 -------------------------------------------------------------------
     Total deferred tax liabilities                   $599      $529
 -------------------------------------------------------------------
 Net deferred taxes                                    ---       ---
 -------------------------------------------------------------------


 A valuation allowance is provided when it is more likely than not that  some
 portion or all of  the deferred tax assets  will not be  realized.  The  net
 change in the valuation allowance for  the year ended December 31, 2001  was
 an increase  of $2,161,000.   At  December  31, 2001,  the Company  has  net
 operating  loss   carryforwards  for   Federal   income  tax   purposes   of
 approximately $8,912,000  which  are  available  to  offset  future  Federal
 taxable income, if  any, through  2021.   The Company  also has  alternative
 minimum  tax  credit  carryforwards  of  approximately  $73,000  which   are
 available to reduce  future Federal regular  income taxes, if  any, over  an
 indefinite period.   In addition, the  Company has  general business  credit
 carryforwards of approximately $129,000 which are available to reduce future
 Federal regular income taxes,  if any.  These  general business credits  are
 scheduled to expire in 2007.


 Note 10.  EARNINGS PER SHARE

 During 2001, 2000  and 1999, the  Company issued a  five percent (5%)  stock
 dividend payable  to all  common stock  shareholders.   The  stock  dividend
 resulted in the issuance of 242,151,  228,582 and 214,627 additional  common
 shares in 2001, 2000 and 1999 respectively.  All reported earnings per share
 disclosures have been retroactively restated to  reflect this dividend.   In
 accordance  with  Statement  of  Financial  Accounting  Standards  No.  128,
 "Earnings Per Share," the following table  presents a reconciliation of  the
 numerators and denominators of basic and  diluted earnings per common  share
 for the years ended:

 ----------------------------------------------------------------------------
  (in $000's except for share data)                  2001      2000     1999
 ----------------------------------------------------------------------------
 Basic earnings (loss) per common share:
   Earnings (loss) from continuing operations      ($2,894)   $1,092    ($838)
   Loss on discontinued operations                  (2,813)     (241)    (352)
 ----------------------------------------------------------------------------
   Net earnings (loss)                             ($5,707)     $851  ($1,190)

   Weighted average common shares outstanding        5,119     5,164    4,981

   Continuing operations                            ($0.57)    $0.21   ($0.17)
   Discontinued operations                          ($0.55)   ($0.05)  ($0.07)
 ----------------------------------------------------------------------------
 Basic earnings (loss) per common share             ($1.12)    $0.16   ($0.24)
 ----------------------------------------------------------------------------

 Diluted earnings (loss) per common share:
   Earnings (loss) from continuing operations      ($2,894)   $1,092    ($838)
   Loss on discontinued operations                  (2,813)     (241)    (352)
 ----------------------------------------------------------------------------
   Net earnings (loss)                             ($5,707)     $851  ($1,190)

   Weighted average common shares outstanding        5,119     5,164    4,981
   Add:  Effect of dilutive stock options              ---        86      ---
 ----------------------------------------------------------------------------
   Adjusted weighted average common shares           5,119     5,250    4,981
     outstanding

   Continuing operations                            ($0.57)    $0.21   ($0.17)
   Discontinued operations                          ($0.55)   ($0.05)  ($0.07)
 ----------------------------------------------------------------------------
 Diluted earnings (loss) per common share           ($1.12)    $0.16   ($0.24)
 ----------------------------------------------------------------------------


 Options which had  an anti-dilutive effect  at December 31,  2001, 2000  and
 1999 were 767,148, 991,786 and 679,205, respectively and were excluded  from
 the diluted earnings per share calculation.


 Note 11.  JOINT VENTURE & ACQUISITION

 On January 4,  2000, the  Company entered into  a 50/50  joint venture  with
 Eastern Asia  Technology Limited  of Singapore  to produce  and  manufacture
 video monitors in Malaysia.   The joint venture  is accounted for under  the
 equity method of accounting.

 On January 12, 2000, the Company acquired certain assets of American  Gaming
 and Electronics of Las Vegas, New Jersey and Florida.  This acquisition  was
 accounted for under the purchase method  of accounting and is operated as  a
 wholly owned subsidiary.  The proforma effects on the results of  operations
 had the acquisition occurred at the beginning of the year was immaterial.


 Note 12.  DISCONTINUED OPERATIONS

 On December 3, 2001, the Company announced the sale of assets as of November
 30, 2001 of its  coin door division for  a purchase price  of $315,000.   In
 accordance with Statement  of Financial  Accounting Standards  No. 144,  the
 Company recorded a loss  on discontinued operations  of $2,813,000 in  2001,
 which is comprised  of a  loss from  operations of  $419,000 and  a loss  on
 disposal of  $2,394,000.  Net  sales of  the  discontinued  operations  were
 $2,006,000 in 2001, $4,130,000 in 2000 and $2,621,000 in 1999.


 Note 13.  LEASE COMMITMENTS

 The Company leases  certain buildings, data  processing and other  equipment
 under operating lease agreements expiring through the year 2008.  The future
 minimum lease payments required under operating leases are as follows:

 -------------------------
             Years ending
 (in $000's)  December 31,
 -------------------------
     2002        $825
     2003         707
     2004         632
     2005         556
 Thereafter     1,246
 -------------------------
               $3,966
 -------------------------

 Rent  expense  related  to  operating  leases  was  approximately  $872,000,
 $427,000 and $161,000  during the years  ended December 31,  2001, 2000  and
 1999, respectively.


 Note 14.  UNAUDITED QUARTERLY FINANCIAL DATA

 Selected quarterly data for 2001 and 2000 are as follows:

 ----------------------------------------------------------------------------
                                                          2001
                                         ------------------------------------
 (in $000's except per share data)        First     Second    Third    Fourth
 ----------------------------------------------------------------------------
 Net sales                               $11,570   $10,579   $9,883   $10,518
 Net earnings (loss)                       ($680)  ($2,111)   ($337)  ($2,579)
 Basic net earnings (loss) per share      ($0.13)   ($0.42)  ($0.07)   ($0.50)
 Diluted net earnings (loss) per share    ($0.13)   ($0.42)  ($0.07)   ($0.50)
 ----------------------------------------------------------------------------

 ----------------------------------------------------------------------------
                                                          2000
                                         ------------------------------------
 (in $000's except per share data)        First     Second    Third    Fourth
 ----------------------------------------------------------------------------
 Net sales                               $11,867   $12,977   $9,763   $11,857
 Net earnings (loss)                        $596      $133     $232     ($110)
 Basic net earnings (loss) per share       $0.11     $0.03    $0.04    ($0.02)
 Diluted net earnings (loss) per share     $0.11     $0.03    $0.04    ($0.02)
 ----------------------------------------------------------------------------
<PAGE>

 INDEPENDENT AUDITORS' REPORT

 The  Board  of  Directors  and  Shareholders  of  Wells-Gardner  Electronics
 Corporation:

 We have  audited  the accompanying  consolidated  balance sheets  of  Wells-
 Gardner Electronics Corporation and subsidiary as  of December 31, 2001  and
 2000 and the  related consolidated statements  of operations,  shareholders'
 equity  and  cash  flows  for  each  of  the  years in the three-year period
 ended December 31, 2001.  These consolidated financial  statements  are  the
 responsibility of  the  Company's  management.   Our  responsibility  is  to
 express an opinion on these consolidated  financial statements based on  our
 audits.

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

 In our  opinion, the  consolidated financial  statements referred  to  above
 present fairly, in all material respects,  the financial position of  Wells-
 Gardner Electronics  Corporation and  subsidiary at  December 31,  2001  and
 2000, and the results of their operations  and their cash flows for each  of
 the years in the  three-year period ended December  31, 2001, in  conformity
 with accounting  principles  generally  accepted in  the  United  States  of
 America.


 Chicago, Illinois
 February 1, 2002

<PAGE>


 BOARD OF DIRECTORS                      EXECUTIVE OFFICERS

 Anthony Spier                           Anthony Spier
 Chairman, President                     Chairman, President
 & Chief Executive Officer               & Chief Executive Officer

 Marshall L. Burman                      Mark E. Komorowski
 Counsel to Wildman,                     President of American
 Harrold, Allen & Dixon                  Gaming & Electronics

 Jerry Kalov                             George B. Toma  CPA, CMA
 President of Kay Consulting             Vice President of Finance,
                                         Chief Financial Officer, Treasurer
 Frank R. Martin                         & Corporate Secretary
 Senior Partner of Righeimer,
 Martin & Cinquino, P.C.

 Dr. Mark L. Yoseloff
 Chairman & Chief Executive
 Officer of Shuffle Master, Inc.

 OFFICES

 CORPORATE                               WHOLLY OWNED SUBSIDIARIES
 ---------                               -------------------------
 Wells-Gardner Electronics Corporation   American Gaming & Electronics, Inc.
 9500 West 55th Street, Suite A          6255 McLeod Drive, Suite 22
 McCook, Illinois  60525-3605            Las Vegas, Nevada  89120
 800-336-6630                            800-727-6807
 708-290-2100                            702-798-5752
 708-290-2200 (fax)                      702-798-5762 (fax)

 JOINT VENTURE                           202 West Parkway Drive
 Wells Eastern Asia Displays             Egg Harbor Township,
   (M) SDN BHD                           New Jersey 08234
 Lot 316 & 317, Jalan PKNK 3/2           800-890-9298
 Kawasan Peridustrian Sungai Petani      609-383-9970
 08000 Sungai Petani, Kedah, Malaysia    609-383-9971 (fax)
 60-4-441-1336
 60-4-442-7028 (fax)                     2046 McKinley Street
                                         Hollywood, Florida  33020
                                         954-922-9952
                                         954-922-1855 (fax)

 CORPORATE INFORMATION

 ANNUAL MEETING                          BANKERS
 ---------------                         --------
 The annual meeting of shareholders      American National Bank & Trust
 will take place at 2:00 p.m. on         Chicago, Illinois
 Thursday, April 25, 2002 at the
 corporate offices of the Company.


 FORM 10-K                               AUDITORS
 ---------                               --------
 A copy of the Company's annual          KPMG LLP
 report on Form 10-K, without            Chicago, Illinois
 exhibits, as filed with the
 Securities and Exchange Commission      COUNSEL
 is available without charge upon        -------
 written request to George B. Toma at    Katten Muchin & Zavis
 the corporate offices of the Company.   Chicago, Illinois

 TRANSFER AGENT
 --------------
 LaSalle National Bank
 135 South LaSalle Street
 Chicago, Illinois  60603
 800-246-5761