-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MKvjZdNqjyNG9tIneUi7Ox2z2K4NH89GY/RM0xs99wMrTrYz5CAxCJWrxmPZytph AS9eWYIsvyN6ktCV2AC93A== 0000950123-01-502495.txt : 20010516 0000950123-01-502495.hdr.sgml : 20010516 ACCESSION NUMBER: 0000950123-01-502495 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010331 FILED AS OF DATE: 20010515 FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNICO INC CENTRAL INDEX KEY: 0000797564 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-DIRECT MAIL ADVERTISING SERVICES [7331] IRS NUMBER: 731215433 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-15303 FILM NUMBER: 1635276 BUSINESS ADDRESS: STREET 1: 24 LAKESIDE AVENUE CITY: POMPTON LAKES STATE: FL ZIP: 07442 BUSINESS PHONE: 9738397200 MAIL ADDRESS: STREET 1: 24 LAKESIDE AVENUE CITY: POMPTON LAKES STATE: NJ ZIP: 07442 FORMER COMPANY: FORMER CONFORMED NAME: CMS ADVERTISING INC DATE OF NAME CHANGE: 19891107 10QSB 1 y49248e10qsb.txt FORM 10-QSB 1 U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB (Mark One) [x] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2001 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT For the transition period from to Commission file no. 0-15303 UNICO, INC. (Name Of Small Business Issuer In Its Charter) Delaware 73-1215433 (State or Other Jurisdiction of (I.R.S. Employer Incorporation) Identification No.) 24 Lakeside Avenue, Pompton Lakes, NJ 07442 (Address of Principal Executive Offices) (Zip Code) (973) 839-7200 (Issuer's Telephone Number, Including Area Code) Check whether the issue: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 [ ] State the number of shares outstanding of each of the issuer's classes of common equity as of the latest practical date: As of April 9, the company had 16,879,163 shares of common stock outstanding, $0.01 par value. UNICO, INC. Form 10-QSB Quarterly Report For The Period Ended March 31, 2001 2
Page Part I - FINANCIAL INFORMATION Item 1. Financial Statements Unaudited Consolidated Statement of Financial Condition At March 31, 2001 and December 31, 2000 For Unico, Inc. and Subsidiaries 3 Unaudited Consolidated Statement of Operations for the Three Months Ended March 31, 2001 and March 31, 2000 for Unico, Inc. and Subsidiaries 4 Unaudited Statement of Cash Flows for the Three months ended March 31, 2001 and March,31 2000 for Unico, Inc. and Subsidiaries 5 Unaudited Statement of Stockholders' Equity (Deficiency) at March 31 , 2001 for Unico, Inc. and Subsidiaries 6 Notes to Interim Consolidated Financial Statements 7 Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations 12 Part II - OTHER INFORMATION Item 1. Legal Proceedings 13 Item 2. Changes in Securities 13 Item 3. Defaults Upon Senior Securities 13 Item 4. Submission of Matters to a Vote of Security Holders 13 Item 5. Other Information 13 Item 6. Exhibits and Reports on Form 8-K 13 Signatures 13
PART I - FINANCIAL INFORMATION Item 1. Financial Statements BASIS OF PRESENTATION The accompanying unaudited financial statements are presented in accordance with generally accepted accounting principles in America for interim financial information and the instructions for Form 10-QSB and Item 310 under subpart A of Regulation S-B. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles in America for complete financial statements. The accompanying statements should be read in conjunction with the audited financial statements for the years ended December 31, 2000 and December 31, 1999. In the opinion of management, all adjustments (consisting only of normal occurring accruals) considered necessary in order to make the financial statements not misleading have been included. Operating results for the quarter ended March 31, 2001 are not necessarily indicative of results that may be expected for the year ended December 31, 2001. The financial statements are presented on the accrual basis. 3 UNICO, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION AS OF March 31, 2001 and 2000
March 31, December 31, 2001 2000 ---------- ---------- ASSETS CURRENT ASSETS Cash and cash equivalents $ 3,545 $ 128 Accounts and notes receivable, net 152,177 181,946 ---------- ---------- Total current assets 155,722 182,074 FIXED ASSETS Computer equipment, net 111,858 126,389 ---------- ---------- Total fixed assets, net 111,858 126,389 OTHER ASSETS Goodwill, net 937,448 953,781 Gas, oil and mineral lease rights 40,000 40,000 Misc. 24,010 11,779 ---------- ---------- Total other assets 1,001,458 1,005,560 TOTAL ASSETS $1,269,038 $1,314,023 ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Bank overdraft $ 0 $ 21,331 Accounts payable 328,353 294,623 Other short term debt 376,280 359,149 Due on Independent News Acquisition 156,000 156,000 ---------- ---------- Total current liabilities 860,633 831,103 ---------- ---------- LONG-TERM LIABILITIES Due to shareholder 240,311 240,311 Accrual for litigation 960,000 960,000 ---------- Total long term liabilities 1,200,311 1,200,311 ---------- ---------- TOTAL LIABILITIES 2,060,944 2,031,414 STOCKHOLDERS' EQUITY (DEFICIENCY) Common stock $.01 par value, 20,000,000 shares authorized, 12,505,496 and 12,505,496 outstanding at March 31, 2001 and December 31, 2000, respectively 125,055 125,055 Additional paid-in capital 7,896,509 7,896,509 Retained earnings (8,813,470) (6,979,758) ---------- ---------- Total stockholders' equity (deficiency) (791,907) (717,391) TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY) $1,269,038 $1,314,023 ========== ==========
4 UNICO, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND MARCH 31, 2000
2001 2000 ------------ ----------- REVENUE Advertising revenue $ 442,547 0 Other 25,955 $ 0 ------------ ----------- Total revenue 468,503 0 ------------ ----------- EXPENSES Cost of sales 143,547 0 Printing 129,740 General and administrative 238,865 33,953 Depreciation 14,532 Amortization of goodwill 16,333 ------------ ----------- Total expenses 543,017 33,953 ------------ ----------- INCOME (LOSS) BEFORE INCOME TAXES (74,514) (33,953) INCOME TAX PROVISION -- -- ------------ ----------- NET INCOME (LOSS) $ (74,514) $ (33,953) BASIC NET INCOME (LOSS) PER COMMON SHARE Weighted average common shares outstanding Basic common shares 12,505,496 5,929,185 Assuming dilution for unexercised options 12,505,496 6,029,185 NET EARNINGS (LOSS) PER SHARE $ (0.01) $ (0.01)
5 UNICO, INC. AND SUBSIDIARY CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2001 AND MARCH 31, 2000
2000 1999 -------- -------- CASH FLOWS FROM OPERATING ACTIVITIES Net income (loss) $(74,514) $(33,953) Adjustments to reconcile net income to net cash provided by operating activities: Accounts receivable 37,566 0 Receivable from shareholder 0 32,000 Accounts payable 33,730 21,327 Depreciation and amortization 30,865 -- Accrued expense (8,938) (3,800) Other assets (15,198) 0 Other liabilities (21,331) 0 -------- -------- Net cash provided by (used) by operating activities (17,820) 15,574 -------- -------- CASH FLOWS PROVIDED BY (USED) BY INVESTING ACTIVITIES Purchase of computer equipment 0 (16,274) -------- -------- Net cash provided (used) by Investing Activities 0 (16,274) -------- -------- CASH FLOW FROM FINANCING ACTIVITIES Loan from shareholder 0 18,000 Equipment lease refinance 21,236 0 -------- -------- Net cash provided (used) by financing activities 21,236 18,000 -------- -------- INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 3,416 17,300 CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 128 4,910 -------- -------- CASH AND CASH EQUIVALENTS, END OF PERIOD $ 3,544 $ 22,209 ======== ========
6 UNICO, INC. AND SUBSIDIARY CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIENCY) AT March 31, 2001
Excess Stock Shares of Retained Capital Over Dividend Total Common Earnings At Par Par Declared Equity Stock ----------- --------- ----------- --------- ----------- --------- As of December 31, 1998 ($6,768,187) $ 18,773 $ 7,921,443 $ 172,665 $ 1,344,694 1,877,272 Correction # shares outstanding -- 1,686 (1,686) -- -- 168,600 Stock issued for services -- 1,333 11,167 -- 12,500 133,313 Dividend paid -- -- -- (172,665) (172,665) -- Off-set of amount due to subsidiary sale -- -- (1,106,399) -- (1,106,399) -- Stock issued in connection with Silver Valley -- 2,500 2,500 -- 5,000 250,000 Contributions to capital -- 35,000 7,500 -- 42,500 3,500,000 Net Income- (211,571) -- -- -- (211,571) -- As of December 31, 1999 ($6,979,758) $ 59,292 $ 6,834,525 $ 0 ($ 85,941) 5,929,185 ----------- --------- ----------- --------- ----------- --------- Acquisition of BidInvite -- 1,000 (1,000) -- -- 100,000 Capital contribution -- -- 80,000 -- 80,000 300,000 Stock issued for Services -- 33,713 286,980 -- 320,693 3,071,311 Indy News Acquisition -- 32,000 367,264 -- 399,264 3,200,000 Cancellation of shares -- (950) (15,376) -- (16,326) (95,000) Net income for The period (1,415,081) -- -- -- (1,415,081) -- ----------- --------- ----------- --------- ----------- --------- As of December 31, 2000 (8,394,839) 125,055 7,552,393 0 (717,391) 12,505,496 Net income For the period (74,514) -- -- -- (74,514) -- ----------- --------- ----------- --------- ----------- --------- As of March 31, 2001 (8,469,353) 125,055 7,552,393 -- (791,905) 12,505,496
7 Unico, Inc. and Subsidiaries Notes To the Financial Statements December 31, 2000 and March 31, 2001 Note 1 - Organization and summary of significant accounting policies. A - Nature of operation In May, 1998 the Company entered into an agreement with NexGen to sell its only active subsidiary UMSI to NexGen. The Transaction was consummated in July, 1999. This left the Company as a publicly traded "shell" company. In July, 2000, the Company acquired all of the issued and outstanding stock of The Independent News, a freely distributed newspaper in Northern New Jersey, having a circulation of 110,000. The newspaper employs approximately 25 individuals actively engaged in the publication of the newspaper, selling advertising, and distribution activities. This was accounted for as a purchase transaction. B - Basis of consolidation. The Consolidated financial statements include the subsidiaries of the Company, The Independent News, BidInvite, Silver Valley Energy, and Pompton Valley Publishing. Intercompany transactions have been eliminated in consolidation. C - Acquisitions - see also Notes 5, 6, and 8 During May, 1999, the Company acquired all the issued and outstanding common stock of Silver Valley Energy (SVE) for $35,000 and 250,000 shares of common stock (see Note 3). SVE owns the oil, gas, and mineral lease rights on approximately 1,200 acres of land located in Texas. The company is inactive and is not presently developing these rights. In March, 2000, the Company acquired all the issued and outstanding stock of BidInvite for 100,000 shares of stock. This company's business plan envisioned an Internet based bid solicitation system for the construction industry, a process that is now entirely manual. However, because of the recent decline in the value of Internet stocks, the project was abandoned in the third quarter of 2000. This company was sold in September, 2000 for $1,000,000 that is payable only in the event the purchaser is successful in obtaining the necessary financing to fund the business plan. Because of this contingent aspect, no recognition in given to the sale in the Company's financial statements. This transaction was accounted for as a pooling of interests. In July, 2000, the Company acquired from NexGen all the issued and outstanding stock of The Independent News for 3,200,000 shares of common stock (see Note 3), issuing $200,000 of its own debt, secured by the Stock in The Independent News and assuming a $60,000 note payable to a commercial bank owed by NexGen. On September 7, 2000, the Company entered into a definitive contract to acquire all of the issued and outstanding common stock of Merrimack Publishing. This acquisition has not been consummated yet as it is contingent upon Merrimack's obtaining audited financial statements for the past two years. Merrimack is the designer of software specifically tailored for independent newspapers. D - Property and equipment Property, equipment, and leasehold improvements are valued at cost. Depreciation is provided by use of the straight-line method over the shorter of estimated useful lives or lease terms of the assets. Fully depreciated assets are written off the year after they are fully depreciated or amortized. Upon the sale or retirement of property and equipment, the related cost and accumulated depreciation are eliminated from the accounts, and the resulting gain or loss is recorded. Repairs and maintenance expenditures that do not extend the useful lives are included in expense during the period they are incurred. Property and equipment consisted of the following at March 31, 2001 and December 31, 2000.
Estimated March 31, 2001 December 31, 2000 Useful Lives Computer and other equipment 290,210 249,890 5 years Leasehold improvements 58,458 58,458 5 years (Less) Accumulated Depreciation (196,491) (181,959) -------- -------- Net Property and Equipment 152,177 126,389
E - Cash and cash equivalents For purposes of reporting cash flows, the Company classifies all cash and short-term investments with maturities of three months or less to be cash equivalents. F - Income taxes The Company has adopted the provisions of Statement of Financial Accounting Standards No. 109 "Accounting For Income Taxes," which incorporates the use of the asset and liability approach of accounting for income taxes. The asset and liability approach requires the recognition of deferred tax assets and liabilities for the future expected results of differences between the financial reporting basis and tax basis of certain assets and liabilities. In 1999 the Company went through an ownership change and, as a result, management believes that any net operating loss carryforwards 8 were lost. In addition, operations through 1999 and 2000 have produced net operating loss carryforwards of approximately $800,000. No benefit has been recognized in the Company's financial statements since realization is not "more likely than not" to happen. The Company files a consolidated tax return. G - Impairment of long lived assets The Company accounts for the impairment and disposition of long-lived assets in accordance with Statement of Financial Accounting Standards No. 121 (SFAS No. 121), Accounting for the Impairment of Long-Lived Assets to Be Disposed Of. In accordance with SFAS No. 121, long-lived assets to be held are reviewed for events or changes in circumstances, which indicate that their carrying value may not be recovered. The Company periodically reviews the carrying value of long-lived assets to determine whether or not impairment to such value has occurred. H - Earnings (loss) per share Basic earnings (loss) per share are computed by dividing the net income for the year by the weighted average number of shares outstanding for the year. Diluted earnings (loss) per share is computed by taking into consideration the unexercised stock options as if the stock were issued. I - Leases The Company sub-leases property at 24 Lakeside Avenue, Pompton Lakes, New Jersey from one of its wholly owned subsidiaries for $1,000 on a month to month basis. The subsidiary leases the overall property from a non-affiliated party for $3,800 per month. The lease is for a five year period expiring in March of 2003, and the rent expense for the period ended March 31, 2001 was approximately $11,400. Rent expense for the year 2001 and 2002 will be $45,600 per year and $5,700 for the first three months in 2003 For a total of 62,700. It is anticipated that the lease will be renewed. J - Revenue recognition Advertising revenues are recognized when customer ads appear in the newspaper. K - Financial statement estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that effect the reported amounts of assets and liabilities and disclosures 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. L - Fair value of financial instruments Oil and gas lease rights, valued at cost, approximate fair value in the judgment of management. Goodwill is valued at the net residual cost in the acquisition of its subsidiary The Independent News. The Company amortizes this goodwill on a straight-line basis over a 15 year period. M - Comprehensive income The Company has adopted SFAS No. 130 Reporting Comprehensive Income. The Company has no reportable differences between net income and comprehensive income, therefore a statement of comprehensive income has not been presented. 9 Note 3 - Common stock On May 29, 1999, the Company acquired 100% of Silver Valley Energy for 1,080,000 shares of its common stock. Subsequently, the purchase price was re-negotiated for $35,000 and 190,000 shares of free trading stock. The amended agreement is reflected in the financial statements. On July 1, 2000, the Company acquired all the issued and outstanding stock of The Independent News for 3,200,000 shares of its common stock, among other consideration. On March 1, 2000, the Company acquired all of the issued and outstanding stock of BidInvite, Inc. (see Notes 1C and 6.) Throughout 200 and the first quarter of 2001, the Company issued stock for consultant and advisory services in varying amounts and at various times. The Company made a 1 for 3 reverse stock split just before the SVE acquisition in 1999. This reverse stock split has been recognized in the Company's financial statements retroactive to 1988. The stock transfer agent was changed in May of 1999 at which time, an additional 168,587 additional shares of stock were found. Management has not been able to determine for what purpose these shares were issued. These shares have been recorded as a reduction of paid in capital and an increase in capital stock at par. Note 4 - Precision Communication Consultants acquisition On December 28, 1999, the Company entered into a share exchange agreement with Precision Communication Consultants LLC (Precision). In that agreement, the Company was to acquire all of the interests in Precision for warrants to acquire 500,000 shares of the Company's common stock at varying prices and 416,470 shares of the Company's common stock. The Company believes that it was induced to enter into the transaction based on incorrect financial representations and will not honor the warrants when presented and will cancel the common stock at some future point in time. The Company has not received any interests in Precision. The matter is not in litigation. 10 Note 5 - BidInvite Sale On September 15, 2000, the Company sold a 95% interest in BidInvite to foreign investors for a $1,000,000 non-interest bearing note. Under the terms of this note, payment of $500,000 is to be made if and when the purchasers are able to secure $3,000,000 in financing for BidInvite's business plan. Additionally, another $500,000 will be due if and when the purchasers are able to obtain another $3,000,000 of financing. Because of the contingent nature of this transaction, no recognition of the sale has been reflected in the Company's financial statements. Note 6 - Stock options Effective September 30, 1999, the Company adopted an omnibus stock option plan. The plan provides for 2,000,000 shares as Incentive Stock Options and 2,000,000 as Employee Stock Options. As of December 31, 1999, 359,450 options had been granted to Directors and key employees. The exercise price is $0.01 per share. These options were exercised on April, 2 2000. In addition, in June of 2000, 272,011 of additional options were given to employees and directors of the Company along with 1,085,000 given to various consultants for services rendered. Also, in April, 2000 845,000 shares were given to Nateko, the Company's software development partner in South America. Note 7 - Litigation and contingencies The Company has been sued in connection with its acquisition of Silver Valley Energy. In addition, In October 2000, the Company received a default judgment in the amount of $960,000 and is in the process of negotiating a non-monetary settlement. However, since the Company has received a default judgment, management has accrued the entire dollar amount in the Company's financial statements. NexGen has alleged that the Company is in default with respect to its $200,000 note payable issued in connection with its acquisition of The Independent News. At December 31, 2000 $156,000 remains unpaid. NexGen has not filed a suit in this transaction and the Company believes that certain financial misrepresentations were made in connection with its acquisition of the Independent News. The matter is currently under negotiation. No amount has been recognized in the financial statements for this contingency. The Company has been sued by the former Chief Executive Officer of BidInvite asserting that he is entitled to 100,000 shares of free trading stock that relates to his employment. No such agreement was entered into by an Officer of the Company, and management believes that the suit is without any substance. No amount has been recognized in the financial statements for this contingency. Note 8 - Going concern Despite all of the acquisitions and related efforts, the only funds raised to date are those either loaned to or contributed to the capital of the Company by its shareholders. Unless funds are obtained from other sources, or the company has positive cash flow from operations, the Company's ability to continue as a going concern could be jeopardized. Management is aggressively expanding the Company's business using existing resources and is currently in contact with several sources that are potential investors. Note 9 - Cancellation of debt Prior to the Company's acquisition of The Independent News, NexGen had loaned The Independent News approximately $270,000. As part of the purchase transaction, NexGen converted their debt into the right to receive "trade credits" or free advertising. Accordingly, the Company has only recognized as a liability those amounts that it will ultimately incur as costs to provide free advertising, or $25,000 Note 10 - Subsequent event On April 8, 2001, the Company filed with the Securities and Exchange Commission Form S-8 that registered approximately 3,500,000 shares of the Company, which were given to various employees, Directors, and consultants in lieu of cash payments for a total dollar amount of $70,000. 11 Managements Discussion and Analysis of Financial Conditions and Results of Operations. MANAGEMENT DISCUSSION AND ANALYSIS On July 1, 2000, the Company acquired all of the issued and outstanding stock of The Independent News, Inc. for its common stock and other consideration. The Independent News is a freely distributed, independent newspaper servicing various communities in Northern New Jersey. The newspaper publishes several weekly editions in its region and two monthly editions. The weekly editions have a circulation of approximately 70,000 while the monthly circulation is approximately 40,000. The newspaper contains news content and advertisements for local business establishments along with classified advertisements. Revenues primarily come from Advertising display advertisements (82%), classified advertisements (12%), and inserts sales and other commissions (5%). Gross revenues for the first quarter totaled $468,503, which are in line with revenues reported for the first three months of 2000. (The Independent News was not owned by Unico, Inc. during the first quarter and, accordingly, these results are not included in this report. Production and printing costs totaled $143,547 and $129,740 or 30% and 28% of gross revenue respectively. These costs are in line with the first quarter of 2000, although the Independent News was not owned by the Company at that time. Prior to the acquisition of The Independent News, its shareholder, NexGen, advanced approximately $270,000 to the newspaper. In connection with the acquisition, NexGen agreed to convert its receivable from The Independent News into "trade credits," which essentially entitles NexGen to receive $270,000 of free advertising. The Independent News adjusted this liability to an amount which it believes is the cost of providing the free advertising, resulting in cancellation of debt in the amount of $245,000. This debt cancellation is accounted for as a non-recurring item. As previously outlined in the "The Company's Business," The Independent News and the Company have developed a web-site that places advertisers' advertisements on the Internet permitting The Independent News to charge higher than normal advertising rates. This "platform" can be migrated to other non-competing newspapers allowing them to place their advertisers' advertisements on the Internet, permitting them to charge higher rates as well. The Company is marketing this web product to other newspapers without charging any up-front fees and shares in additional revenue by charging 50% of the additional revenue collected. The company plans to vigorously market this product, as it believes that approximately 90% of the 15,000 freely distributed newspapers in the US do not have web-sites. Mr. Joe Nicastro is the Publisher of the Independent News and has 15 years in the Newspaper business. He is also a Past President of the Independent Free Papers of America, the largest trade association, of free papers in the US and, as such, has numerous contacts in the industry. The marketing efforts are largely conducted through personal contacts, attending trade shows at various locations throughout the US, distribution of marketing materials, and other personal approaches. The Company plans to hire a National Sales Manager and General Manager in the next several months to augment its expansion activities in this area. The Company has signed a definitive agreement to acquire the Merrimack Publisher, a software company that produces and maintains software that is specific to the publishing industry. It is the Company's plan to integrate this software with its web-based advertising platform, the Local Times and to convert the current operating environment from its existing DOS based environment to a Windows environment. 12 The Company is actively negotiating a settlement with the prior owners of Silver Valley Energy due to its acquisition of same and believes that it can reach an amicable non-monetary settlement. The Company's officers and directors have waived all current payment of cash compensation, and uses its stock as payment for services provided by outside consultants and advisors. It addition, the Company is seeking financing from outside sources. Item 2. Change of Securities The following information sets forth certain information as of March 31, 2001 for changes in securities since December 31, 2000. On April 8, 2001, the Company filed With the SEC Form S-8 registering 3,503,667 shares of its Common stock. The stock was given to various employees, consultants, and advisors in lieu of monetary payments. Item 3. Defaults Upon Senior Securities. NexGen, the seller of the Independent News, is claiming that the Company is in default on its $200,000 obligation to NexGen because of the Company's failure to pay interest and principle on the appropriate date. The Company believes it is not in default, because it has advanced monies to outside third parties on NexGen's behalf, and that certain misrepresentations were made concerning financial aspects of the Independent News. Item 4. Submission of Matters to a Vote of Security Holders. None Item 5. Other information. None. Item 6. Exhibits and reports on Form 8-K. None. 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 in its behalf by the undersigned , thereunto duly authorized, on May 14, 2001. Unico, Inc. Registrant /s/ Ron Stoeppelwerth - ------------------------------ Ron Stoeppelwerth Director and CFO -----END PRIVACY-ENHANCED MESSAGE-----