UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14(a)-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[X] Preliminary proxy statement.
[ ] Confidential, for use of the
Commission only (as permitted by
Rule 14a-6(e)(2)).
[ ] Definitive proxy statement.
[ ] Definitive additional materials.
[ ] Soliciting material pursuant to Section 240.14a-12
UNICO, INCORPORATED
_______________________________________________________________________________
(Name of Registrant as Specified in Its Charter)
______________________________________________________________________________
(Name of Person(s) Filing Proxy Statement if Other Than the Registrant)
Payment of filing fee (check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
_______________________________________________________________________________
(2) Aggregate number of securities to which transaction applies:
_______________________________________________________________________________
(3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
______________________________________________________________________________
(4) Proposed maximum aggregate value of transaction:
______________________________________________________________________________
(5) Total fee paid:
______________________________________________________________________________
[] Fee paid previously with preliminary materials.
______________________________________________________________________________
[] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
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(1) Amount Previously Paid:
______________________________________________________________________________
(2) Form, Schedule or Registration Statement No.:
______________________________________________________________________________
(3) Filing Party:
______________________________________________________________________________
(4) Date Filed:
______________________________________________________________________________
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UNICO, INCORPORATED
8880 Rio San Diego Drive, 8th Floor
San Diego, California 92108
(619) 209-6124
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON JANUARY , 2006
Dear Shareholders:
A special meeting of shareholders of Unico, Incorporated, an Arizona corporation
(the "Company"), will be held on January , 2006 at 10:00 a.m. local time, at a
conference room on the third floor of the building where the Company's offices
are located at 8880 Rio San Diego Drive, San Diego, California 92108 for the
following purposes:
RECOMMENDED VOTE
1. To consider and vote upon a proposal to amend FOR
the Company's Articles of Incorporation to
increase the number of authorized shares of
common stock to 5,000,000,000 (the "Common Stock").
2. To consider and vote upon a proposal to FOR
amend the Company's Articles of Incorporation to
authorize the Board of Directors, in
its discretion, to effect a reverse stock
split of the Company's Common Stock at
a ratio of up to one-for-one hundred during the
six month period following the date of
the Special Meeting of Shareholders.
3. To consider and vote upon a proposal to FOR
reduce the par value of the Common Stock from $0.10
per share to $0.001 per share.
4. To consider and vote upon a proposal to FOR
approve the Company's 2005 Non-Qualified Stock
Option Plan.
Only shareholders of record shown on the books of Unico at the close of business
on December , 2005 will be entitled to vote at the meeting or any adjournment
thereof. Each shareholder is entitled to one vote per share on all matters to
be voted on at the meeting.
You are cordially invited to attend the meeting. Whether or not you plan to
attend the meeting, please sign, date and return your proxy in the return
envelope provided as soon as possible. Please mail your completed and signed
proxy before December , 2005 so that we will receive it prior to the special
meeting of shareholders. Your cooperation in promptly signing and returning
your proxy will help avoid further solicitation expense to Unico.
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This notice, the proxy statement and the enclosed proxy are sent to you by order
of the board of directors.
/s/ Mark A. Lopez______
Mark A. Lopez
Chief Executive Officer
San Diego, CA
December , 2005
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UNICO, INCORPORATED,
an Arizona corporation
PROXY STATEMENT
FOR
SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER , 2005
______________________________
INTRODUCTION
Your proxy is solicited by the board of directors of Unico, Incorporated, an
Arizona corporation ("Unico" or the "Company") for use at a special meeting of
shareholders to be held on January , 2006, and at any adjournment thereof, for
the purposes set forth in the attached notice of special meeting.
The cost of soliciting proxies, including preparing, assembling and mailing the
proxies and soliciting material, will be borne by Unico. Directors, officers,
and regular employees of Unico may, without compensation other than their
regular compensation, solicit proxies personally, by telephone or electronic
communication including facsimile and electronic mail.
Any shareholder giving a proxy may revoke it at any time prior to its use at the
meeting by giving written notice of such revocation to the Secretary or other
officer of Unico or by filing a new written proxy with an officer of Unico.
Personal attendance at the meeting is not, by itself, sufficient to revoke a
proxy unless written notice of the revocation or a subsequent proxy is delivered
to an officer before the revoked or superseded proxy is used at the meeting.
Proxies not revoked will be voted in accordance with the choice specified by
means of the ballot provided on the proxy for that purpose. Proxies which are
signed but which lack any such specification will, subject to the following, be
voted in favor of the proposals set forth in the notice of special meeting. If
a shareholder abstains from voting as to any matter, then the shares held by
such shareholder shall be deemed present at the meeting for purposes of
determining a quorum and for purposes of calculating the vote with respect to
such matter, but shall not be deemed to have been voted in favor of such matter.
Abstentions, therefore, as to any proposal will have the same effect as votes
against such proposal. If a broker returns a "non-vote" proxy, indicating a
lack of voting instruction by the beneficial holder of the shares and lack of
discretionary authority on the part of the broker to vote on a particular
matter, then the shares covered by such non-vote shall be deemed present at the
meeting for purposes of determining a quorum but shall not be deemed to be
represented at the meeting for purposes of calculating the vote required for
approval of such matter.
The mailing address of Unico's principal executive office is 8880 Rio San Diego
Drive, 8th Floor, San Diego, California 92108. This proxy statement and the
related proxy and notice of the special meeting will first be mailed to the
shareholders on or about December , 2005.
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VOTING RIGHTS AND REQUIREMENTS
VOTING SECURITIES
Unico's Board of Directors has fixed December , 2005 as the "Record Date" for
determining shareholders entitled to vote at the special meeting. Persons who
were not shareholders of record at the close of business on such date will not
be allowed to vote at the special meeting. At the close of business on December
, 2005, there were approximately 498,427,896 shares of Unico's Common Stock and
10,000,000 shares of Unico's Series A Preferred Stock issued and outstanding.
Common Stock has 1 vote per share and Series A Preferred Stock has no voting
rights, except for the election of two directors.
Votes cast by proxy or in person at the special meeting will be tabulated by
Mark Lopez who has been appointed as the inspector of election prior to the
special meeting. He will also determine whether a quorum is present. In the
event of any abstentions or broker non-votes with respect to any proposal coming
before the special meeting, a proxy will be counted as present for purposes of
determining the existence of a quorum. Abstentions and broker non-votes
typically will not be counted for purposes of approving any of the matters to be
acted upon at the special meeting. A broker non-vote generally occurs when a
broker or nominee who holds shares in street name for a customer does not have
authority to vote on certain non-routine matters because its customer has not
provided any voting instructions on the matter. Therefore, abstentions and
broker non-votes generally have no effect under Arizona law with respect to the
election of directors or other matters requiring the approval of only a majority
of the shares of common stock present and voting at the meeting.
REVOCABILITY OF PROXY
You may revoke your proxy at any time prior to the start of our special meeting
in three ways:
1. by delivering a written notice of revocation to Mr. Mark Lopez, the chief
executive officer of Unico, at 8880 Rio San Diego Drive, 8th Floor, San
Diego, California 92108;
2. by submitting a duly executed proxy bearing a later date; or
3. by attending our special meeting and expressing the desire to vote your
common shares in person (attendance at our special meeting will not in and
of itself revoke a proxy).
DISSENTERS - RIGHTS OF APPRAISALS
Under Arizona law, shareholders of our common stock are not entitled to
dissenter's rights of appraisal with respect to our proposals.
QUORUM
The presence (in person or by proxy) at the special meeting of the holders of a
number of shares of our Common Stock representing more than 249,213,948 votes
(in excess of one-half of the number of votes eligible to be voted at the
special meeting) will constitute a quorum for transacting business.
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VOTE REQUIRED
We are required to obtain the affirmative vote of at least a majority of the
voting shares that are present or represented at the special meeting, assuming a
quorum is present, in order to effect the shareholder approvals described
herein.
BOARD RECOMMENDATIONS - INSIDERS' INTENT TO VOTE IN FAVOR
Our Board of Directors has determined that each of the proposals is in the best
interests of the Company and our shareholders. Accordingly, the Board of
Directors has unanimously approved each proposal and recommends that the
shareholders vote in favor of each proposal as well.
Members of our board of directors collectively own 25,630,278 shares of Unico's
common stock, or approximately 5.1% of the votes entitled to be cast at the
special meeting. They have indicated their intentions to vote their shares in
favor of each proposal.
MATTERS TO BE ACTED UPON
1. AMENDMENT TO ARTICLES OF INCORPORATION TO INCREASE NUMBER OF AUTHORIZED
SHARES OF COMMON STOCK
The proposal to amend the Company's Articles of Incorporation is described
below. A copy of the proposed amendment to the Company's Articles of
Incorporation is attached to this proxy statement as Exhibit A.
Purpose: The Company's Board of Directors has unanimously adopted a resolution
seeking shareholder approval to amend the Articles of Incorporation to increase
the number of authorized shares of Common Stock to 5,000,000,000. The Board of
Directors believes that this increase in the number of authorized shares is in
the best interest of the Company in that it will provide the Company with
available shares which could be issued for various corporate purposes, including
acquisitions, stock dividends, stock splits, stock options, convertible debt and
equity financings, as the Board of Directors determines in its discretion. The
Board further believes that the increase in the number of authorized shares of
Common Stock will enable the Company to promptly take advantage of market
conditions and the availability of favorable opportunities without the delay and
expense associated with holding a special meeting of shareholders. The Company
presently has no specific plans, arrangements or understandings, either written
or oral, to issue any of the additional authorized shares of Common Stock,
except that: (a) the Company presently has outstanding certain convertible
debentures and 10,000,000 shares of Series A Preferred Stock, all of which are
convertible to shares of the Company's Common Stock, and some or all of which
may be converted to shares of the Company's Common Stock in the future; (b) the
Company previously entered into stock payable agreements pursuant to which the
Company received $110,000 and for which it is obligated to issue an aggregate of
48,519,000 shares of Common Stock, and (c) the Company intends to raise
significant funds in the future to be used to
7
support the operations of the Company and its subsidiaries and to exercise the
option to acquire ownership of the Deer Trail Mine, and the Company will likely
issue a substantial number of the Company's shares of Common Stock for these
purposes. Although the Company cannot at the present time estimate the number of
shares of Common Stock which it may issue in the future, the Company will
require $3,000,000 in order to acquire ownership of the Deer Trail Mine. If the
Company sold shares of Common Stock at the current market price of $.0045 per
share, an aggregate of 666,666,666 would need to be sold to raise $3,000,000.
The Company has no present plans or arrangement to make any such sales of Common
Stock and any such sales could be on terms substantially different than a market
price offering, which could result in substantially greater dilution to current
shareholders. With regard to other funds required to support the operations of
the Company, the Company has no present plans, arrangements or agreements.
If the proposed amendment is adopted by the shareholders, we plan to file an
amendment to our articles of incorporation with the Arizona Corporation
Commission, to be effective as soon as practicable following the Special
Meeting.
Effect: The issuance by the Company of any additional shares of Common Stock
would dilute both the equity interests and the earnings or losses per share of
existing holders of the Common Stock. Such dilution may be substantial,
depending upon the amount of shares issued. The newly authorized shares of
Common Stock will have voting and other rights identical to those of the
currently authorized shares of Common Stock.
The increase in the number of shares of common stock authorized for issuance
could, under certain circumstances, be construed as having an anti-takeover
effect. For example, in the event a person seeks to effect a change in the
composition of our board of directors or contemplates a tender offer or other
transaction involving the combination of the Company with another company, it
may be possible for us to impede the attempt by issuing additional shares of
common stock, thereby diluting the voting power of the other outstanding shares
and increasing the potential cost to acquire control of the Company. By
potentially discouraging initiation of any such unsolicited takeover attempt,
the increased number of authorized shares of Common Stock may limit the
opportunity for our stockholders to dispose of their shares at the higher price
generally available in takeover attempts or that may be available under a merger
proposal. The amendment may also have the effect of permitting our current
management, including our board of directors, to retain its position
indefinitely and place it in a better position to resist changes that
stockholders may wish to make if they are dissatisfied with the conduct of our
business.
Our board of directors did not propose the Amendment or any of the other
amendments to our Articles of Incorporation in response to any effort known to
our board of directors to accumulate common stock or to obtain control of the
Company by means of a merger, tender offer or solicitation in opposition to
management. Further, our board of directors does not currently contemplate
recommending the adoption of any other amendments to the Articles of
8
Incorporation that could be construed as limiting the ability of third parties
to take over or change the control of the Company.
No Dissenters' Rights: The holders of the Company's Common Stock are not
entitled to dissenters' rights in connection with the increase in the number of
authorized shares. Furthermore, the Company does not intend to independently
provide those shareholders with any such rights.
RECOMMENDATION OF THE BOARD OF DIRECTORS: THE BOARD OF DIRECTORS RECOMMENDS A
VOTE "FOR" THE AMENDMENT TO UNICO'S ARTICLES OF INCORPORATION TO EFFECT THE
INCREASE IN THE NUMBER OF SHARES OF AUTHORIZED COMMON STOCK
2. AMENDMENT OF ARTICLES OF INCORPORATION TO EFFECT A REVERSE STOCK
SPLIT
The proposal to amend the Company's Articles of Incorporation to effect a
reverse split is described below. A copy of the proposed amendment to the
Company's Articles of Incorporation is attached to this proxy statement as
Exhibit A.
Purpose: The Board of Directors may effect a reverse stock split anytime during
the six months following the date of the Special Meeting of Shareholders based
upon any ratio up to a maximum ratio of one-for-one hundred, with the exact
ratio to be established within this range by the Board of Directors in its sole
discretion at the time it elects to effect the split. The Board of Directors
believes that the Reverse Split is in the Company's best interests in that it
may increase the trading price of the Common Stock. An increase in the price of
the Common Stock should, in turn, generate greater investor interest in the
Common Stock, thereby enhancing the marketability of the Common Stock to the
financial community. In addition, the resulting reduction in the number of
issued and outstanding shares of Common Stock, together with the proposed
increase in the number of authorized shares of Common Stock, as discussed below,
will provide the Company with additional authorized but unissued shares which
could be utilized for future acquisitions or mergers or to otherwise carry out
the Company's business objectives.
Effect: Although the Reverse Split may increase the market price of the Common
Stock, the actual effect of the Reverse Split on the market price cannot be
predicted. The market price of the Common Stock may not rise in proportion to
the reduction in the number of shares outstanding as a result of the Reverse
Split. Further, there is no assurance that the Reverse Split will lead to a
sustained increase in the market price of the Common Stock. The market price of
the Common Stock may also change as a result of other unrelated factors,
including the Company's operating performance and other factors related to its
business as well as general market conditions. The Reverse Split will affect all
of the holders of the Company's Common Stock uniformly and will not affect any
shareholder's percentage ownership interest in the Company or proportionate
voting power, except for insignificant changes that will result from the
rounding of fractional shares either up or down (see discussion below). However,
because the conversion ratio of the Company's convertible preferred stock will
not be affected by reverse stock split, the current Common Stock holders will be
diluted at different levels
9
depending on the actual ratio of the reverse split. A greater ratio of the
reverse split will result in greater actual dilution to current Common Stock
shareholders. The following table reflects the effect of various ratios of
reverse stock splits on the current shareholders. Information with respect to
shares issuable upon conversion of convertible debentures is based upon the
closing price of the Common Stock as of November 22, 2005.
Resulting Reserved Authorized % of Fully
Reverse Shares Issued & for but Diluted Shares
Ratio Outstanding Issuance Unreserved(1) Outstanding Shares
1-for-25 19,937,116 60,232,431 419,830,453/ 24.9%
4,919,830,453
1-for-50 9,968,558 35,116,215 454,915,227/ 22.1%
4,954,915,227
1-for-75 6,645,705 26,744,143 466,610,152/ 19.9%
4,966,610,152
1-for 100 4,984,279 22,558,108 472,457,613/ 18.1%
________________ 4,972,457,613
Current 498,427,896 1,265,810,785 0/ 25.3%
3,235,761,319
______________________________________________
1. Assuming 500,000,000 shares authorized/assuming 5,000,000,000 shares
authorized.
The reverse stock split will provide the Company with available shares which
could be issued for various corporate purposes, including acquisitions, stock
dividends, stock splits, stock options, convertible debt and equity financings,
as the Board of Directors determines in its discretion. The Board further
believes that the increase in the number of authorized shares of Common Stock
will enable the Company to promptly take advantage of market conditions and the
availability of favorable opportunities without the delay and expense associated
with holding a special meeting of shareholders. The Company presently has no
specific plans, arrangements or understandings, either written or oral, to issue
any of the additional authorized shares of Common Stock, except that: (a) the
Company presently has outstanding certain convertible debentures and 10,000,000
shares of Series A Preferred Stock, all of which are convertible to shares of
the Company's Common Stock, and some or all of which may be converted to shares
of the Company's Common Stock in the future; (b) the Company previously entered
into stock payable agreements pursuant to which the Company received $110,000
and for which it is obligated to issue an aggregate of 48,519,000 shares of
Common Stock, and (c) the Company intends to raise significant funds in the
future to be used to support the operations of the Company and its subsidiaries
and to exercise the option to acquire ownership of the Deer Trail Mine, and the
Company will likely issue a substantial number of the Company's shares of Common
Stock for these purposes. Although the Company cannot at the present time
estimate the number of shares of Common Stock which it may issue in the future,
the
10
Company will require $3,000,000 in order to acquire ownership of the Deer Trail
Mine. If the Company sold shares of Common Stock at the current market price of
$.0045 per share, an aggregate of 666,666,666 would need to be sold to raise
$3,000,000. The Company has no present plans or arrangement to make any such
sales of Common Stock and any such sales could be on terms substantially
different than a market price offering, which could result in substantially
greater dilution to current shareholders. With regard to other funds required
to support the operations of the Company, the Company has no present plans,
arrangements or agreements.
The increase in the number of shares of common stock authorized for issuance as
a result of the reverse split could, under certain circumstances, be construed
as having an anti-takeover effect. For example, in the event a person seeks to
effect a change in the composition of our board of directors or contemplates a
tender offer or other transaction involving the combination of the Company with
another company, it may be possible for us to impede the attempt by issuing
additional shares of common stock, thereby diluting the voting power of the
other outstanding shares and increasing the potential cost to acquire control of
the Company. By potentially discouraging initiation of any such unsolicited
takeover attempt, the increased number of authorized shares of Common Stock may
limit the opportunity for our stockholders to dispose of their shares at the
higher price generally available in takeover attempts or that may be available
under a merger proposal. The amendment may also have the effect of permitting
our current management, including our board of directors, to retain its position
indefinitely and place it in a better position to resist changes that
stockholders may wish to make if they are dissatisfied with the conduct of our
business.
Procedure for Effecting Reverse Split: The Reverse Split of the Company's Common
Stock will become effective at the discretion of the Board of Directors on any
date designated by the Board of Directors (the "Effective Date") within six
months following the date of the Special Meeting of Shareholders. The Reverse
Split will take place on the Effective Date without any additional action on the
part of the holders of the Common Stock and without regard to current
certificates representing shares of Common Stock being physically surrendered
for certificates representing the number of shares of Common Stock each
shareholder is entitled to receive as a result of the Reverse Split. New
certificates of Common Stock will not be issued.
Fractional Shares: No fractional shares will be issued in connection with the
Reverse Split. Shareholders who would otherwise be entitled to receive
fractional shares because they hold a number of shares of Common Stock that is
not evenly divisible by the ratio selected by the Board of Directors will
receive an additional fractional share such that they receive an even number of
shares. For example, a shareholder who would be entitled to receive one-fourth
of a share would instead receive one full additional share of Unico's common
stock on the date that the Reverse Split is implemented.
Federal Income Tax Consequences of Reverse Split: The following summary of
certain material federal income tax consequences of the Reverse Split does
11
not purport to be a complete discussion of all of the possible federal income
tax consequences and is included for general information only. Further, it does
not address any state, local, foreign or other income tax consequences, nor does
it address the tax consequences to shareholders that are subject to special tax
rules, such as banks, insurance companies, regulated investment companies,
personal holding companies, foreign entities, nonresident alien individuals,
broker-dealers and tax-exempt entities. The discussion is based on the United
States federal income tax laws as of the date of this Information Statement.
Such laws are subject to change retroactively as well as prospectively. This
summary also assumes that the shares of the Company's Common Stock are held as
"capital assets," as defined in the Internal Revenue Code of 1986, as amended
(i.e., generally, property held for investment). The tax treatment of a
shareholder may vary depending on the facts and circumstances of such
shareholder. EACH SHAREHOLDER IS URGED TO CONSULT WITH SUCH SHAREHOLDER'S TAX
ADVISOR WITH RESPECT TO THE PARTICULAR TAX CONSEQUENCES OF THE REVERSE SPLIT.
No gain or loss should be recognized by a shareholder upon the shareholder's
exchange of shares pursuant to the Reverse Split. The aggregate tax basis of the
shares received in the Reverse Split will be the same as the shareholder's
aggregate tax basis in the shares exchanged. The shareholder's holding period
for the shares received in the Reverse Split will include the period during
which the shareholder held the shares surrendered as a result of the Reverse
Split. The Company's views regarding the tax consequences of the Reverse Split
are not binding upon the Internal Revenue Service or the courts, and there is no
assurance that the Internal Revenue Service or the courts would accept the
positions expressed above. The state and local tax consequences of the Reverse
Split may vary significantly as to each shareholder, depending on the state in
which such shareholder resides.
No Dissenters' Rights: The holders of the Company's Common Stock are not
entitled to dissenters' rights in connection with the Reverse Split.
Furthermore, the Company does not intend to independently provide those
shareholders with any such rights.
RECOMMENDATION OF THE BOARD OF DIRECTORS: THE BOARD OF DIRECTORS RECOMMENDS A
VOTE "FOR" THE AMENDMENT TO UNICO'S ARTICLES OF INCORPORATION TO EFFECT THE
INCREASE IN THE NUMBER OF SHARES OF AUTHORIZED COMMON STOCK AND TO AUTHORIZE THE
BOARD OF DIRECTORS, IN ITS DISCRETION, TO EFFECT THE REVERSE SPLIT.
3. AMENDMENT TO ARTICLES OF INCORPORATION TO DECREASE THE PAR VALUE OF COMMON
STOCK TO $0.001 PER SHARE
The proposal to amend the Company's Articles of Incorporation is described
below. A copy of the proposed amendment to the Company's Articles of
Incorporation is attached to this proxy statement as Exhibit A.
12
Purpose: The Company's Board of Directors has unanimously adopted a resolution
seeking shareholder approval to amend the Articles of Incorporation to decrease
the par value of the Common Stock from $0.10 per share to $0.001 per share. Par
value is a term that was historically used to protect shareholders from being
unfairly diluted. It refered to the minimum price at which stock of a company
could legally be issued or sold. The par value of a stock is reflected in the
articles of incorporation and on the stock certificates of the Company. It is
also reflected in the Company's financial statements as the "paid in capital,"
reflecting the aggregate par value of all stock issued by the Company.
Under modern corporation law, the importance of par value has decreased. In
Arizona, where the Company is organized, corporate law does not require a
specific minimum par value. So, the Board of Directors believes that it is in
keeping with this law and modern corporate usage that the par value of the
Company's common stock be decreased to a level commonly used by other companies.
The Board also believes that the decrease of par value will remove any potential
misunderstanding that the par value represents an indication of the value of a
stock.
Effect: The Board does not believe that the decrease of the par value will have
any adverse effect on existing shareholders. The change in par value will
simply move the value on the balance sheet from "Common Stock" to "additional
paid in capital". There will be no change to the net assets or the net equity
of the Company.
No Dissenters' Rights: The holders of the Company's Common Stock are not
entitled to dissenters' rights in connection with the decrease in the par value
of the Common Stock. Furthermore, the Company does not intend to independently
provide those shareholders with any such rights.
RECOMMENDATION OF THE BOARD OF DIRECTORS: THE BOARD OF DIRECTORS RECOMMENDS A
VOTE "FOR" THE AMENDMENT TO UNICO'S ARTICLES OF INCORPORATION TO EFFECT THE
DECREASE IN THE PAR VALUE OF THE COMMON STOCK
4. APPROVAL OF THE COMPANY'S 2005 NON-QUALIFIED STOCK OPTION PLAN
Purpose: The Board of Directors unanimously voted to approve a 2005 Non-
Qualified Stock Option Plan (the "Plan") that reserved 50,000,000 shares of the
Company's Common Stock for issuance pursuant to the Plan. The option price of
each option granted pursuant to the Plan shall be determined by a Committee of
the Board of Directors at the time the option is granted, subject to adjustment;
provided, however, that in no event shall the option price be less than 100% of
the current market value of the underlying shares on the date of grant and the
option must expire within 10 years from the date of adoption of the Plan. The
Committee of the Board of Directors shall also determine which of the eligible
employees of the Company and its subsidiaries shall be granted options and the
number to be granted to each. Persons eligible to receive options granted under
the Plan include any employee (including a director or officer) employed by
Unico or its subsidiaries on a full time or part time basis, at the time of an
option grant who is compensated for such employment or services. As of November
22, there were nine persons who would be eligible for grants under the Plan.
As of the
13
Record Date, the Company currently has no options outstanding under this Plan
and there are no specific grants contemplated to any person or group of people.
The Company believes that the Plan is in the best interest of the Company as it
makes it easier to attract and retain individuals key to the implementation of
our business strategy. The Company is seeking shareholder approval for the plan.
Effect: There will be no additional effect on the shareholders of the Company as
a result of this action since the Plan is already in effect. The subsequent
exercise of stock options granted pursuant to the Plan will cause a dilutive
effect to existing shareholders as the number of outstanding shares will be
increased. The Company will also receive cash consideration upon the exercise of
options equal to the number of options being exercised times the fair market
value of the stock on the date the options were granted.
No Dissenters' Rights: The holders of the Company's Common Stock are not
entitled to dissenters' rights in connection with the adoption of the Company's
2005 Non-Qualified Stock Option Plan. Furthermore, the Company does not intend
to independently provide those shareholders with any such rights.
RECOMMENDATION OF THE BOARD OF DIRECTORS: THE BOARD OF DIRECTORS RECOMMENDS A
VOTE "FOR" APPROVAL OF THE COMPANY'S 2005 NON-QUALIFIED STOCK OPTION PLAN.
INTERESTS OF CERTAIN PERSONS IN THE PROPOSALS
No director, executive officer, associate of any director or executive officer
or any other person has any substantial interest, direct or indirect, by
security holdings or otherwise, in the proposal to amend the Articles of
Incorporation or the proposal to approve the Company's 2005 Non-Qualified Stock
Option Plan which is not shared by all other holders of the Company's Common
Stock, with the exception that directors (who also serve as employees) and
executive officers may receive options granted pursuant to the plan. See
"Security Ownership of Certain Beneficial Owners and Management." Mark Lopez,
Wayne Hartle and Ray Brown are each holders of shares of series A preferred
stock of the Company. As such, they may benefit from the withdrawal of the
Company as a BDC, because such withdrawal would permit them to continue to hold
their shares of series A preferred stock.
DESCRIPTION OF CAPITAL STOCK
The authorized capital stock of the Company consists of the following:
COMMON STOCK
As of the Record Date, there were 500 million shares of Common Stock authorized
with a stated value of $.10 per share, of which approximately 498,427,896 shares
were issued and outstanding, with 572,104 shares authorized but unissued.
Immediately following the approval of the increase in the number of authorized
shares of Common Stock, as described previously,
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there will be 5 billion shares with a par value of $0.001 of Common Stock
authorized, of which approximately 498,427,896 will be issued and outstanding
and approximately 4,501,572,104 will be authorized but unissued. Each holder of
Unico's Common Stock is entitled to one vote for each share held of record on
all matters submitted to the vote of stockholders, including the election of
directors. All voting is non-cumulative, which means that the holder of fifty
percent (50%) of the shares voting for the election of the directors can elect
all the directors. The holders of Common Stock are entitled to receive pro rata
dividends, when and as declared by the Board of Directors in its discretion, out
of funds legally available therefore, but only if all dividends on the Preferred
Stock have been paid in accordance with the terms of such Preferred Stock and
there exists no deficiency in any sinking fund for the Preferred Stock.
Dividends on the Common Stock are declared by the Board of Directors. The
payment of dividends on the Common Stock in the future, if any, will be
subordinate to the Preferred Stock and will be determined by the Board of
Directors. In addition, the payment of such dividends will depend on the
Company's financial condition, results of operations, capital requirements and
such other factors as the Board of Directors deems relevant.
PREFERRED STOCK
As of the Record Date, the Company has 20,000,000 shares of Preferred Stock
designated. The Board of Directors has sole discretion in designating the
preferences, limitations and relative rights of the Preferred Stock. The
Company presently has one (1) class or series of Preferred Stock outstanding.
Series A Preferred Stock - The Company has ten million (10,000,000) shares of
Series A Preferred Stock designated. Each share of Series A Preferred Stock is
convertible into shares of the Company's Common Stock on a one-for-one (1:1)
basis, and the conversion ratio is not affected by forward or reverse stock
splits. The Series A Preferred Stock is non-interest bearing, does not have
voting rights and is not entitled to receive dividends. In the event of a
liquidation event, the Series A Preferred Stock automatically converts into
Common Stock based on the foregoing formula. Holders of the Series A Preferred
Stock are entitled to elect two (2) persons to the Company's Board of Directors.
As of the Record Date, there were 10,000,000 shares of Series A outstanding.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of November 1, 2005 the beneficial ownership
of the Company's Common Stock (i) by any person or group known by the Company to
beneficially own more than 5% of the outstanding Common Stock, (ii) by each
Director and executive officer and (iii) by all Directors and executive officers
as a group. Unless otherwise indicated, the holders of the shares shown in the
table have sole voting and investment power with respect to such shares. The
address of all individuals for whom an address is not otherwise indicated is
8880 Rio San Diego Drive, 8th Floor, San Diego, California 92108.
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Number of Shares Beneficially Owned Percentage of Class
Name and Address Class
Mark A. Lopez 5,000,000 Common 1%
Chief Executive Officer 5,401,968 Series A Preferred 54%
Wayne Ash 200,000 Common *
President
Wayne Hartle 1,197,000 Common *
Secretary 348,989 Series A Preferred 4%
Richard Belliston 1,233,278 Common *
Director
Ray Brown 18,000,000 Common 4%
Director 3,549,043 Series A Preferred 35%
All directors and executive officers 25,630,278 Common 5%
(5 persons) 9,300,000 Series A Preferred 93%
*Denotes less than 1%
This table is based upon information derived from our stock records. Unless
otherwise indicated in the footnotes to this table and subject to community
property laws where applicable, the Company believes that each of the
shareholders named in this table has sole or shared voting and investment power
with respect to the shares indicated as beneficially owned. Applicable
percentages are based upon 498,427,896 shares of common stock and 10,000,000
shares of Series A Preferred Stock outstanding as of October 1, 2005.
AVAILABLE INFORMATION
The Company is subject to the periodic reporting requirements of the Securities
Exchange Act of 1934, as amended, and, in accordance therewith, files reports
and other information with the Commission. Such reports and other information
can be inspected and copied at the public reference facilities maintained by the
Commission at 100 F Street, N.E., Washington, D.C. 20549, at prescribed rates.
Please call the Commission at (202) 942-8090 for further information. Copies of
such materials may also be accessed electronically by means of the Commission's
home page on the Internet at "http://www.sec.gov."
OTHER BUSINESS
The board of directors knows of no other matters to be presented at the special
meeting. If any other matter does properly come before the special meeting, the
appointees named in the proxies will vote the proxies in accordance with their
best judgment.
SHAREHOLDER PROPOSALS
Proposals of shareholders that are intended to be presented at Unico's next
annual meeting of shareholders must have been received by the Company not later
than a reasonable time before Unico begins to print and mail its proxy materials
under the provisions of Rule 14a-8 of the Securities Exchange Act
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of 1934. Unico intends that its next annual meeting of shareholders shall be
held in June, 2006.
The person presiding at the next annual meeting of shareholders may refuse to
permit to be brought before the meeting any shareholder proposal not made in
compliance with Rule 14a-8.
INFORMATION INCORPORATED BY REFERENCE
The SEC allows the Company to incorporate by reference information that the
Company files with the SEC. Unico incorporates by reference the information
contained in Unico's Annual Report to Stockholders on Form 10-KSB for the fiscal
year ended February 28, 2005 filed with the SEC on June 20, 2005 and mailed with
this proxy statement.
ANNUAL REPORT
A copy of Unico's Annual Report to Shareholders on Form 10-KSB for the fiscal
year ended February 28, 2005, including financial statements, accompany this
notice of special meeting and proxy statement.
THE COMPANY WILL FURNISH WITHOUT CHARGE A COPY OF ITS ANNUAL REPORT ON FORM 10-
KSB FOR THE FISCAL YEAR ENDED FEBRUARY 28, 2005 TO ANY SHAREHOLDER OF THE
COMPANY UPON WRITTEN REQUEST. REQUESTS SHOULD BE SENT TO MARK LOPEZ, 8880 RIO
SAN DIEGO DRIVE, 8TH FLOOR, SAN DIEGO, CALIFORNIA 92108.
Dated: December , 2005
San Diego, California
17
UNICO, INCORPORATED
PROXY FOR SPECIAL MEETING TO BE HELD ON JANUARY , 2006
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Mark A. Lopez as proxy, with the power to
appoint their substitute(s), to represent and to vote all the shares of common
stock of Unico, Incorporated, an Arizona corporation (the "Company"), which the
undersigned would be entitled to vote, at Unico's special meeting of
stockholders to be held on January , 2006 and at any adjournments thereof,
subject to the directions indicated on the reverse side hereof.
In their discretion, the proxy is authorized to vote upon any other matter that
may properly come before the meeting or any adjournments thereof.
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE SPECIFICATIONS MADE, BUT IF NO
CHOICES ARE INDICATED, THIS PROXY WILL BE VOTED FOR THE PROPOSAL LISTED ON THE
REVERSE SIDE.
IMPORTANT--This Proxy must be signed and dated on the reverse side.
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SPECIAL MEETING OF SHAREHOLDERS OF
UNICO, INCORPORATED
December , 2005
THIS IS YOUR PROXY
YOUR VOTE IS IMPORTANT!
Dear Stockholder:
We cordially invite you to attend the Special Meeting of Stockholders of Unico,
Incorporated to be held at 10:00 a.m. local time on January , 2006, at a
conference room on the third floor of the building where the Company's offices
are located at 8880 Rio San Diego Drive, San Diego, California 92108. Please
read the proxy statement which describes the proposals and presents other
important information, and complete, sign and return your proxy promptly in the
enclosed envelope.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1, 2, 3 AND 4
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.
PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE [x]
1. Proposal to increase authorized FOR AGAINST ABSTAIN
shares of Common Stock of the
Company to 5,000,000,000 shares. [_] [_] [_]
2. Proposal to authorize the Board of
Directors, in its discretion, to
effect a reverse stock split of the
Company's Common Stock at a ratio up
to one-for-one hundred during the
six month period following the
vote of the Special Meeting of
Shareholders. [_] [_] [_]
3. Proposal to decrease par value of
common stock to $0.001 per share. [_] [_] [_]
4. Proposal to approve the Company's 2005
Non-Qualified Stock Option Plan. [_] [_] [_]
4. To transact such other business as may properly come before the special
meeting and any adjournment or adjournments thereof.
The board of directors recommends you vote "FOR" each of the above
proposals.
This proxy when properly executed will be voted in the manner directed above.
In the absence of direction for the above proposal, this proxy will be voted
"FOR" that proposal. Other matters: in their discretion, the appointed
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proxies are authorized to vote upon such other business as may properly come
before the meeting.
If you plan to attend the special meeting of shareholders, please mark this box
[_]
Dated:________________, 200_
SIGNATURE _____________________________________________________________
NAME (PRINTED) ________________________________________________________
TITLE _________________________________________________________________
Important: Please sign exactly as name appears on this proxy. When signing as
attorney, executor, trustee, guardian, corporate officer, etc., please indicate
full title.
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EXHIBIT "A"
ARTICLES OF AMENDMENT
to the
ARTICLES OF INCORPORATION
of
UNICO, INCORPORATED
Pursuant to the provisions of the Arizona Code, the undersigned
corporation adopts the following Articles of Amendment to its Articles of
Incorporation:
FIRST: The name of the corporation is Unico, Incorporated.
SECOND: Article IV of the Articles of Incorporation is amended in its
entirety in the manner prescribed by the Arizona Code so as to read as follows:
ARTICLE IV. The authorized capital stock of this
corporation shall consist of five billion
(5,000,000,000) shares of common stock, $0.001 par
value, said stock to be paid for at such time and in
such manner as the Board of Directors may designate, and
twenty million (20,000,000) shares of preferred stock,
$0.001 par value, said stock to be issued in such manner
and having such preferences, limitations and relative
rights as the board of directors may designate, as
permitted by the Arizona Code. Such stock shall be
issued as fully paid and shall be forever non-
assessable. The judgment of the board of directors as to
the value of the property taken, or services rendered in
exchange for stock, shall be conclusive in the absence
of fraud. No stockholder shall have pre-emptive rights
as to any stock now or hereinafter authorized to be
issued, but the issuance of stock shall be in the sole
discretion of the Board of Directors.
[Paragraph "THIRD" below, shall only be completed and included if and
when Unico's Board of Directors adopts a Reverse Split.]
THIRD: That the presently issued and outstanding Common Stock of the
corporation, $.001 par value, shall, at __:__ a.m., Eastern Time, on
______________, 2005 (the "Effective Time"), be deemed to be "reverse split,"
and in the furtherance thereof, there shall, after the Effective Time, be deemed
to be issued and outstanding one (1) share of the Common Stock of the
Corporation for and instead of each _____ (_) shares of the Common Stock of the
Corporation issued and outstanding immediately prior to the Effective Time. To
the extent that any shareholder shall be deemed after the Effective Time as a
result of this Amendment to own a fractional share of Common Stock, such
fractional share shall be deemed to be one whole share. Each shareholder of
record as of the Effective Time shall be entitled to receive from the
Corporation's transfer agent a certificate representing the number of shares of
the Common Stock to which such shareholder is entitled hereunder up on delivery
to the Corporation's transfer agent of a certificate or
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certificates representing the number of shares owned by such shareholder of
record as of the Effective Time.
FOURTH: The foregoing amendment was adopted by the vote of the
shareholders on January , 2006.
FIFTH: The number of shares of the Corporation outstanding at the time of
such adoption was 498,427,896 common shares (1 vote per share) and 10,000,000
Series A Preferred Shares (non-voting); and the number of shares entitled to
vote thereon was 498,427,896. The number of shares indisputably represented at
the meeting where the vote occurred was _________.
SIXTH: The number of shares voted for such amendment was _________; and
the number of shares voted against such amendment was _____. _____________
shares abstained. The number of shares voted for the amendment was sufficient
for approval of the amendment.
SEVENTH: The foregoing amendment does not effect an exchange,
reclassification or cancellation of shares.
EIGHTH: The amount of stated capital after the amendment is $_______.
Dated this ____ day of January, 2006
UNICO, INCORPORATED
By __________________________
Its Chief Executive Officer
and __________________________
Its Secretary
STATE OF CALIFORNIA )
: ss.
COUNTY OF SAN DIEGO )
I, __________________________, Notary Public, do hereby certify that on
this __, day of January, 2006 personally appeared before me Mark A. Lopez who
being by me first duly sworn, declared that he is the Chief Executive Officer of
Unico, Incorporated, that he signed the foregoing document as the Chief
Executive Officer of the Corporation, and that the statements therein contained
are true.
_______________________________
Notary Public
Residing at: _____________________
My Commission Expires: __________
SEC\0577
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