SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM SB-2
Registration Statement
Under the
Securities Act of 1933
(Amendment No. _________________)
ZING TECHNOLOGIES, INC.
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(Name of Small Business Issuer in Its Charter)
New York 5065 13-265062
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(State or Other (Primary Standard (I.R.S. Employer
Jurisdiction of Industrial Classification Identification No.)
Incorporation Code Number)
or Organization)
115 Stevens Avenue, Valhalla, New York, (914) 747-7474
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(Address and Telephone Number of Principal Executive Offices)
115 Stevens Avenue, Valhalla, New York
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(Address of Principal Place of Business or Intended Principal Place of Business)
Zing Technologies, Inc., 115 Stevens Avenue, Valhalla, New York, (914) 747-7474
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(Name, Address and Telephone Number of Agent For Service)
Approximate Date of Proposed Sale to the Public: From time to
time after the effective date of this Registration Statement.
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please
check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for
the same offering. / /
----------------------------------------------------------
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. / /
-------------------------
If delivery of the prospectus is expected to be made pursuant to
Rule 434, please check the following box. / /-----------------------------
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CALCULATION OF REGISTRATION FEE
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Proposed
Title of Each Proposed Maximum
Class of Dollar Maximum Aggregate
Securities Amount to be Offering Price Offering Amount of
to be Registered Registered Per Unit Price Registration Fee
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<S> <C> <C> <C> <C>
Common Stock, $2,740,622.50 $13.75 * $2,740,622.50 $945.04
par value $.01 per
share
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</TABLE>
*Estimated solely for the purposes of determining the
registration fee. This amount, calculated pursuant to Rule
457(c), was based on the average of the high and low prices of
the Registrant's Common Stock on November 1, 1995, as reported on
the NASDAQ - National Market System.
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The registrant hereby amends this registration statement on such
date or dates as may be necessary to delay its effective date until
the registrant shall file a further amendment which specifically
states that this registration statement shall thereafter become
effective in accordance with Section 8(a) of the Securities Act of
1933 or until the registration statement shall become effective on
such date as the Commission, acting pursuant to said Section 8(a), may
determine.
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CROSS REFERENCE SHEET
Pursuant to Rule 501(a)(4)
of Regulation S-B showing location
in Prospectus of Information Required
By Items in Part I of Form SB-2
Location/Caption
Item in Prospectus
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1. Front of Registration Statement
and Outside Front Cover of Prospectus . . . . . . Outside front
cover page
2. Inside Front and Outside
Back Cover Pages of Prospectus . . . . . Inside front and outside
back cover pages
3. Summary Information and Risk Factors . . . . . . . . Risk Factors
4. Use of Proceeds . . . . . . . . . . . . . . . . Use of Proceeds
5. Determination of Offering Price . . . . . . . . . Not Applicable
6. Dilution . . . . . . . . . . . . . . . . . . . . . Not Applicable
7. Selling Security Holders . . . . . . . . . . Selling Shareholders
8. Plan of Distribution . . . . . . . . . . . Plan of Distribution/
Sale of Shares
9. Legal Proceedings . . . . . . . . . . . . . . . . Not Applicable
10. Directors, Executive Officers,
Promoters and Control Persons . . . . . . . . . . . . Management
11. Security Ownership of Certain
Beneficial Owners and Management . . . . . . . Security Ownership
12. Description of Securities . . . . . . . . . . . . . Common Stock
13. Interest of Named Experts
and Counsel . . . . . . . . Management -- Certain Transactions;
Legal Matters; Selling Shareholders
<PAGE>
14. Disclosure of Commission Position on
Indemnification for Securities Act Liabilities . Indemnification
15. Organization Within Last Five Years
Management -- Certain Transactions
16. Description of Business . . . . . . . . . . . . . . The Company
17. Management's Discussion and Analysis
or Plan of Operation . . . . . . . . . . . . . . . Not Applicable
18. Description of Property . . . . . . . . . . . . . . The Company
19. Certain Relationships and Related
Transactions . . . . . . . . . Management -- Certain Transactions
20. Market for Common Equity and Related
Stockholder Matters . . . . . . . . . . . . . . . . Common Stock
21. Executive Compensation . . . . . . . . . . . . . . . . Management
22. Financial Statements . . . . . . . . . . . . Financial Statements
23. Changes in and Disagreements With Accountants
on Accounting and Financial Disclosure . . . . . . Not Applicable
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<PAGE>
PROSPECTUS
ZING TECHNOLOGIES, INC.
199,318 Shares of Common Stock
(Par Value $.01 Per Share)
This Prospectus relates to 199,318 shares (the "Shares") of
common stock, par value $.01 per share (the "Common Stock"), of Zing
Technologies, Inc., a New York corporation (the "Company"), which may
be sold from time to time by the selling shareholders named herein
(the "Selling Shareholders"). See "Selling Shareholders" below. The
Shares have been issued or are issuable to the Selling Shareholders
upon the exercise of certain warrants (each a "Warrant") granted to
the Selling Shareholders in connection with their past compensation as
officers, directors or employees of the Company. The Company has
received or will receive approximately $1.34 for each Share issued
upon the exercise of a Warrant. The Company will not receive any of
the proceeds from the sale of the Shares by the Selling Shareholders.
The expenses of registration incurred in connection with this
offering, up to $.15 per share, together with all selling and other
expenses incurred by the Selling Shareholders in connection with the
sale of the Shares, will be borne by the Selling Shareholders.
Expenses of registration in excess of $.15 per share, if any, will be
borne by the Company. The Company is not aware of any underwriting
arrangements with respect to the sale of any of the Shares by the
Selling Shareholders.
The Shares may be offered by or for the account of the Selling
Shareholders, from time to time, on the NASDAQ National Market System
or on any stock exchange on which the Shares may be listed at the time
of sale, in negotiated transactions, or through a combination of such
methods of sale, at fixed prices, which may be changed, at market
prices prevailing at the time of sale, at prices related to such
prevailing market prices, or at negotiated prices. The Selling
Shareholders may effect such transactions by selling the Shares to or
through broker-dealers who may receive compensation in the form of
discounts, concessions, or commissions from the Selling Shareholders
and/or the purchasers of the Shares (which compensation as to a
particular broker-dealer might be in excess of customary commissions).
Any broker-dealer acquiring Shares from a Selling Shareholder may sell
such Shares in its normal market making activities, through other
brokers on a principal or agency basis, in negotiated transactions, or
through a combination of such methods. See "Selling Shareholders" and
"Plan of Distribution/Sale of Shares".
The Common Stock is traded in the NASDAQ National Market System
under the symbol "ZING". On November 1, 1995, the average of the high
and low prices for shares of the Common Stock was $13.75 per share, as
reported on the NASDAQ National Market System.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR
<PAGE>
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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Underwriting
Discounts and Proceeds to Issuer
Price to Public and Commissions or Other Persons(1)
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<S> <C> <C> <C>
Per Share Total 100% 0% 100%
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(1)The Selling Shareholders may effect transactions by selling the
Shares to or through broker-dealers, and such broker-dealers may receive
compensation in the form of discounts, concessions, or commissions from the
Selling Shareholders. See "Plan of Distribution/Sale of Shares."
The date of this Prospectus is November 8, 1995.
[End of Outside Front Cover.]
[Inside Front or Outside Back Cover]
No person has been authorized to give any information or to make any
representation other than as contained or incorporated by reference in this
Prospectus, and any information or representation not contained or incorporated
by reference herein should not be relied upon as having been authorized by the
Company. This Prospectus does not constitute an offer of any securities
other than those described on the cover page or an offer to sell or a
solicitation of an offer to buy the Shares in any State or other jurisdiction
where, or to any person to whom, it is unlawful to make such offer. Neither
the delivery of this Prospectus nor any sales made hereunder, under any
circumstances, shall create any implication that there has been no change
in the affairs of the Company between the date hereof and the date of any such
sale.
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TABLE OF CONTENTS
Section Page
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RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . 4
THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
COMMON STOCK . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECURITY OWNERSHIP . . . . . . . . . . . . . . . . . . . . . . . 20
SELLING SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . 22
PLAN OF DISTRIBUTION/SALE OF SHARES . . . . . . . . . . . . . . . 24
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . 25
LEGAL MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . 25
EXPERTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . 26
INDEX TO FINANCIAL INFORMATION . . . . . . . . . . . . . . . . . 27
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and,
in accordance therewith, files reports, proxy statements, and other
information with the Securities and Exchange Commission (the
"Commission"). Such reports, proxy statements, and other information
can be inspected and copied at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549, and at the following Regional Offices: the Northeast
Regional Office, Seven World Trade Center, Suite 1300, New York, New
York 10048, and the Midwest Regional Office, Northwestern Atrium
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-
2511. Copies of such material can be obtained by written request from
the Public Reference Section of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549, at prescribed rates. The Common Stock
is traded on the NASDAQ National Market System, and the Company's
reports and proxy statements may be inspected at the offices of the
National Association of Securities Dealers, Inc., located at 1735 K
Street, N.W., Washington, D.C. 20006.
This Prospectus constitutes a part of a registration statement
(the "Registration Statement") on Form SB-2 filed by the Company with
the Commission under the Securities Act of 1933, as amended (the
"Securities Act"), with respect to the Shares offered by this
Prospectus. This Prospectus omits certain of the information
contained in the Registration Statement, and reference is hereby made
to the Registration Statement and related exhibits for further
information with respect to the Company and the Shares offered hereby.
Statements in this Prospectus as to the contents of exhibits are not
necessarily complete, and each statement is qualified in all respects
by reference to the copies of documents filed or incorporated by
reference as an exhibit to the Registration Statement or otherwise
filed with the Commission. See also "Incorporation of Certain
Documents by Reference".
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents (or parts thereof) filed by the Company
with the Commission are incorporated by reference in this Prospectus:
1. The Company's Annual Report on Form 10-K for the
fiscal year ended June 30, 1995;
2. The Company's Definitive Proxy Statement, dated
August 10, 1995; for the Annual Meeting of
Shareholders held on September 12, 1995;
3. All other reports filed by the Company pursuant to Section
13(a) or 15(d) of the Exchange Act since the end of the
fiscal year covered by the Annual Report referred to in (1)
above; and
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4. The description of the Common Stock contained in the
registration statement filed under the Exchange Act
registering such Common Stock under Section 12 of the
Exchange Act, including any amendment or report filed for
the purpose of updating such description.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14, or 15(d) of the Exchange Act after the date of this Prospectus and
prior to the filing of a post-effective amendment indicating that all
of the Shares have been sold, or deregistering all of the Shares that,
at the time of such post-effective amendment, remain unsold, shall be
deemed to be incorporated by reference in this Prospectus and to be a
part hereof from the date of filing of such documents. Any statement
contained herein or in any document incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained herein or in any
other subsequently filed document, which also is or is deemed to be
incorporated by reference herein, modifies or supersedes such
statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of
this Prospectus.
The Company shall furnish without charge to each person,
including any beneficial owner, to whom a copy of this Prospectus is
delivered, upon the written or oral request of such person, a copy of
any or all of the documents which are incorporated by reference herein
(other than exhibits to such documents, unless such exhibits are
specifically incorporated by reference into such documents). Written
or telephone requests for such documents should be directed to Deborah
J. Schrader, Secretary, Zing Technologies, Inc., 115 Stevens Avenue,
Valhalla, New York 10595. The Company's telephone number is (914)
747-7474.
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RISK FACTORS
The following factors should be carefully considered in
evaluating the Company, its two subsidiaries, Omnirel Corporation
("Omnirel") and Transition Analysis Component Technology, Inc.
("TACTech"), and their respective businesses before purchasing the
securities offered hereby.
Dependence Upon Major Customers/Projects for Omnirel Products
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Sales of various industrial products to a single customer
represented 19% of Omnirel's sales revenues for the Fiscal Year 1994
and 65% of Omnirel's sales revenues for fiscal year 1995. A single
project accounted for approximately 16% of Fiscal Year 1994 sales and
63% of fiscal year 1995 sales. Because of Omnirel's dependence on
sales to one major customer in Fiscal Years 1994 and 1995, and
anticipated dependence on sales to such customer in Fiscal Year 1996,
which, based on existing orders are expected to be less than in 1995,
there can be no assurance that fiscal 1996 sales will match 1995
sales, or that, in the event sales to such major customer decline over
the succeeding years, Omnirel will be able to compensate for the loss
of such sales in Fiscal Year 1996 and beyond.
Decline in Defense and/or Aerospace Spending
- --------------------------------------------
Although Omnirel's military, defense and aerospace business
represents a decreasing percentage of its overall sales in recent
years (and, therefore, is decreasing in its significance), the
businesses of both Omnirel and TACTech continue to depend to a
substantial extent upon sales to military, defense and aerospace
contractors. In the event that military, defense and/or aerospace
spending were to decline significantly over the next several years,
sales by Omnirel and TACTech could suffer a corresponding or greater
decline. In such event, both companies would have to seek replacement
markets in other industries. There can be no assurance that such
markets would be available or that either company would be successful
in penetrating them.
Dependence on Key Personnel
- ---------------------------
The businesses of Omnirel and TACTech are substantially dependent
upon the active participation and technical expertise of their
executive officers. Omnirel is dependent upon the services of John F.
Catrambone, its Chief Executive Officer, while TACTech is dependent
upon Malcolm Baca, its Executive Vice President and Chief Operating
Officer. The Company currently maintains key-man life insurance
policies on both such executive officers in the amounts of $1,500,000
and $1,700,000, respectively. Omnirel also maintains a key-man life
insurance policy on Mr. Catrambone in the amount of $2,500,000. Both
the Company's and Omnirel's Boards of Directors regularly re-evaluate
the need for and amount of such key-man life insurance. There can be
no assurance, however, that the Company or Omnirel can obtain
executives of comparable expertise and commitment in the event of
death, or that the business of the Company would not suffer material
adverse effects as the result of the death
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(notwithstanding coverage by key-man insurance), disability or
voluntary departure of any such executive officer.
Absence of Dividends
- --------------------
The Company does not currently intend to pay cash dividends on
its Common Stock. The Board of Directors present policy is to retain
earnings to provide funds for the operations and expansion of the
Company's business. The Company's dividend policy is reviewed from
time to time by its Board of Directors in light of its earnings and
financial condition, its research and development and other needs, and
such other business considerations as the Board of Directors considers
pertinent.
Competition
- -----------
Although the market for multi-chip power modules and packaged
semiconductor components is fragmented and no single company maintains
a dominant position, it is nevertheless highly competitive among the
five manufacturers (including Omnirel) who collectively account for
approximately 65% of sales to such market. Omnirel believes that its
products and technologies can compete favorably with the products of
its principal competitors. Nevertheless a few of these competitors
have greater financial, marketing, servicing and research and
development resources than those of Omnirel. There can be no
assurance that existing or potential competitors will not develop and
market products that are superior or perceived to be superior to
multi-chip power modules and other products supplied by Omnirel.
TACTech's license agreements are cancelable on thirty (30) days'
notice. Approximately 50% of TACTech's information for its data bases
comes from numerous companies in the private sector. Accordingly,
there can be no assurance that existing arrangements with private
suppliers of data will continue in effect or, if they are canceled,
that TACTech will be able to enter into arrangements with other
suppliers on terms as beneficial to TACTech as those presently in
effect. Moreover, there can be no assurance that other companies,
including existing customers of TACTech, will not avail themselves of
sources of data to develop their own software and data base services
either in competition with TACTech or to enable them to have their own
sources for such services. TACTech's software services and data bases
are protected by trade secret provisions of license agreements and by
copyright laws, but because such provisions and laws are frequently
difficult or costly to enforce, there can be no assurance that such
protection will prove effective.
Technological Change and New Product Development
- ------------------------------------------------
In the event of changes in the structure of the computer hardware
systems used by subscribers to operate TACTech's data base software,
TACTech would incur capital costs for new equipment and development
costs in connection with the reconfiguring of its software programs,
which costs could be substantial and could have an adverse effect on
TACTech's profitability. In addition, TACTech regularly incurs
capital costs in connection with its new
5
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product development in advance of their being ready for market, and
there can be no assurances that such new products will prove
profitable.
THE COMPANY
The Company is a holding company with one material 98% owned
operating subsidiary, Omnirel (approximately 84% owned by the Company
on a fully diluted basis), and one non-material 90% owned operating
subsidiary, TACTech. The Company was incorporated in New York on
October 17, 1969.
Background and Business
- -----------------------
Since June 26, 1991, when the Company acquired Omnirel, the
Company has engaged in the manufacture and sale of high reliability
power semiconductor multi-chip modules and packaged semiconductor
components in its niche market and has expanded its distribution into
the high-end commercial and industrial market.
High reliability power semiconductor multi-chip modules are
defined as electronic components and are single-package devices with a
power dissipation of five watts or more. They combine active power
semiconductor components and passive components (such as capacitors
and resistors) which form integrated smart power electronic circuits
which control, drive and regulate the input and output of power
(electricity) in motion control and power supply applications for use
in electronic systems and equipment. Omnirel manufacturing techniques
and design standards for the military and high-reliability industrial
markets are more exacting than is the case for commercial general
purpose hybrid circuit components. The products manufactured by
Omnirel include custom designed products as well as standard commodity
products.
Omnirel produces both standard and custom products in a clean
room environment and is certified to MIL-STD 1772, the highest level
of military certification for a hybrid circuit manufacturer, and is
registered to ISO 9001. Omnirel's products are used where circuit
density (including miniaturization), electrical performance and
reliability are critical design requirements, such as in the defense,
aerospace, commercial transportation and medical device industries.
Omnirel's products are also used in the production of industrial
controls and power supplies where these same criteria are needed.
TACTech licenses proprietary computer software databases to
military semiconductor manufacturers, the Department of Defense and
defense contractors. The databases provide the end users with
information useful in determining the projected life cycle
(obsolescence) of microcircuits and discrete semiconductor devices
used primarily in the manufacture of systems for military and
aerospace applications. TACTech software also contains a description
and the general specification of each microcircuit and discrete
semiconductor device, thereby allowing
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the user to identify functionally interchangeable devices from various
manufacturers and to upgrade and rank the devices according to life
cycle and availability based on sources of supply. The TACTech
database is believed to include virtually all standard microcircuits
and discrete devices with high reliability specifications used
primarily for military or aerospace application. The database is
constantly updated and delivered on a real-time or near real-time
basis. TACTech is not presently a material subsidiary to the Company.
Until May 19, 1993, the Company was principally engaged in the
business of distributing high reliability electronic semiconductor
components used in military and aerospace equipment and providing
value-added services under the name Zeus Components, Inc. It was one
of the largest distributors in this niche market, representing over
thirty semiconductor manufacturers, with a product line which
consisted of integrated circuits, discrete semiconductors, and passive
components. Integrated circuits generally are sold at higher unit
prices and at higher unit gross profit margin than discrete
semiconductors. Passive components generally consist of capacitors
and resistors.
On May 19, 1993, the Company sold the net assets of its high
reliability electronic component distribution and value added service
businesses to Arrow Electronics, Inc. (the "Arrow Sale"). Arrow is
the world's largest electronic components distributor. The purchase
price was $24,254,000, representing a premium of approximately
$3,000,000 over the net book value of the assets transferred. In May
1996 the Company is entitled to receive up to $2,000,000 from Arrow as
additional purchase price depending on the performance of Arrow's high
reliability electronic components and value-added business. Based
upon information received to date, the Company believes sales are
running at a rate which would make it more likely than not that some
or all of the $2,000,000 will be realized by the Company.
Competition
- -----------
The market for high reliability power semiconductor multi-chip
modules is fragmented. There is no single firm which maintains a
dominant position, either in technology or in market share. Based on
recent industry publications of Frost & Sullivan, Moody Associates and
the Semiconductor Industry Association, the total available market for
high reliability power semiconductor multi-chip modules within the
United States was approximately $300,000,000 in 1993 and $330,000,000
in 1994, and is expected to grow at a rate greater than 10% per annum
during the later 1990's. The market for power hybrid products which
Omnirel addresses is in excess of $125,000,000 a year and
approximately 65% of the sales to such market are made by five
manufacturers (including Omnirel) of power hybrid components. Omnirel
is the only such manufacturer whose primary focus is on high
reliability power semiconductor multi-chip modules. The principal
competitors of Omnirel are other hybrid manufacturers, original
equipment manufacturers with internal capability and power
semiconductor manufacturers who offer multi-chip modules as a
complementary product line. Omnirel distinguishes itself in the
marketplace principally on the strength of its focus on power
applications. It has complete design, manufacturing and high
reliability screening capabilities in-house, and has developed a
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reputation for innovative solutions for customer needs. The Company
also competes on the basis of pricing and delivery.
Marketing and Sales
- -------------------
Omnirel markets its products through four regional sales managers
in the United States and twenty-five sales representative
organizations world-wide. Omnirel sells both standard and custom
products to approximately two hundred customers world-wide. Standard
products are sold both through distributors and directly to customers.
Custom products are sold directly to customers.
Omnirel publishes and distributes to its existing customers and
potential new customers a catalogue of its standard products. Omnirel
management has focused its marketing effort in the United States where
nineteen independent sales representatives are coordinated by
Omnirel's sales management. Key accounts are also covered by area
managers in each sales region. Six representatives/distributors are
currently in place in Europe marketing Omnirel's products.
Omnirel's customers are primarily major electronic equipment and
systems manufacturers such as General Electric, Loral, Bendix,
Hamilton-Standard, Hughes Aircraft, Boeing, Texas Instruments,
Raytheon and Motorola. Sales of various products to General Electric
representing multiple industrial and military/aerospace programs at
four separate locations aggregated 65% of Omnirel's sales revenues for
fiscal year 1995 of which a single project accounted for approximately
63% of 1995 sales. Based upon orders already placed, sales to General
Electric are expected to represent a significant portion of Omnirel's
fiscal 1996 sales. The Company expects that the current General
Electric orders will be filled during the first three quarters of
fiscal 1996, and while additional sales to such customer are likely,
revenues from General Electric are expected to decline significantly
over the next several years. The amount of the decline is dependent
upon factors such as the level of General Electric's business, whether
Omnirel continues as General Electric's sole source supplier and
whether Omnirel can produce the products required by General Electric
based upon changing technology. Arrow is Omnirel's exclusive
distributor of its single and multi-chip semiconductor devices for a
period ending December 31, 1996.
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Omnirel's customers outside the United States and export sales
outside the United States are as follows:
1995 1994 1993
- --------------------------------------------------------------------------------
(000's omitted)
Canada $67 $89 $ --
Europe 172 183 249
Mid East
(Israel) 99 30 24
Far East (Japan) 12 5 4
South Pacific
(Australia) 12 151 44
--- ---- ---
Total $362 $458 $321
=== === ===
Omnirel's backlog on June 30, 1995 was $15,900,000; $9,100,000 of
which is represented by the General Electric order. Approximately 90%
of the backlog is deliverable over the next 12-month period.
For the fiscal years 1995, 1994, and 1993 Omnirel did not enter
into any contracts with either customers of the United States
Government or any agency of the United States Government. Omnirel
sells its products to subcontractors of certain government agencies
through customer purchase orders. Cancellation of purchase orders
from time to time is customary in the power hybrid component industry.
Under standard industry practices, in the event of cancellation,
Omnirel is entitled to reimbursement of costs incurred and a
reasonable profit for work performed prior to the cancellation.
The sale of Omnirel products is not seasonal. However, the
timing of sales to Omnirel's principal customer was concentrated
predominantly in the fourth quarter, and to a lesser extent the third
quarter, of fiscal 1995.
Product Warranty
----------------
Omnirel warrants that its products are free from defects in
workmanship and meet with the agreed upon specifications supplied by
the customer or Omnirel's current published specifications. Omnirel's
liability for defective products is limited solely to replacement
thereof upon receipt from the customer of notice of breach of warranty
within varying periods of between three (3) and twelve (12) months of
the date of shipment, depending upon the product. Omnirel disclaims
any liability for a customer's cost of replacement of defective
products, for lost profits, loss of use and consequential damages.
Omnirel also disclaims any warranty or merchantability and all other
warranties, express or implied.
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Suppliers and Materials Used
----------------------------
Unpackaged semiconductors, in chip form and other components such
as capacitors and resistor chips or surface mount devices, metal and
plastic packages and ceramic materials are used by Omnirel in the
manufacture of its products. These materials and components, none of
which is presently in short supply, are purchased from time to time on
the open market, and Omnirel has no long term commitments for their
purchase. Omnirel is not dependent on any one supplier for a primary
material. Omnirel has agreements with a number of premier
semiconductor manufacturers which allow Omnirel to buy products
directly from such manufacturers. These agreements also allow Omnirel
to be apprised of technological advances and developments.
Patents, Trademarks and Licenses
--------------------------------
Omnirel does not possess any patents for proprietary
manufacturing processes. Omnirel believes, however, that its
proprietary processes and product technologies are such that they give
it a unique position in the design and manufacture of power
semiconductor hybrids and multi-chip modules using semiconductor
assembly technology. The Omnirel name and logo are unique trademarks.
While Omnirel considers that in the aggregate its trademarks are
important in its operation, it does not consider that one or any group
of trademarks is of such importance that termination could materially
affect its business. TACTech maintains copyright protection for its
computer software, and claims proprietary trade secret protection
through customer licensing agreements.
Inventory
---------
Omnirel follows industry standards for procurement, sale and
return of its inventory. Materials are procured based upon purchase
orders which have standard terms and conditions including the right of
return for inferior quality or non-compliance with purchase order
terms. Omnirel inventory is maintained at its principal place of
business in storage facilities with temperature and humidity controls.
Omnirel stocks inventory for standard products, and for certain of its
custom products.
Environmental Compliance
------------------------
Omnirel does not use hazardous materials in its manufacturing
process nor does the manufacturing process result in the discharge of
potentially hazardous material. Omnirel does not expect to incur
significant expenditures relating to environmental compliance.
Research and Development
------------------------
Generally, Omnirel's research and development expenditures
involve engineering and design of custom products for specific
applications, development of new packaging techniques and development
of packaging for new semiconductor devices. Research and development
10
<PAGE>
expenditures for the fiscal years ended June 30, 1995, and June 30,
1994, and the nine months ended June 30, 1993 were $1,055,000,
$841,000, and $808,000, respectively or 4.7%, 7.3% and 1.5% of sales
in those respective periods.
Employees
---------
As of June 30, 1995, Zing had 157 employees, 102 of whom were
employed by Omnirel in a manufacturing capacity and 34 in clerical,
administrative, engineering or sales positions at Omnirel. The
Company employs four people in executive or administrative functions,
and TACTech employs five computer programmers and an additional 12
persons in clerical, sales, customer support and administrative roles.
None of Zing's employees are covered by a collective bargaining
agreement.
In March 1995, in exchange for the shares of Omnirel common stock
owned by Omnirel's president and his release of his rights to
participate in Omnirel's Management Incentive Rights Plan ("MIRP"),
Omnirel granted its president options to purchase up to an aggregate
of 100,000 shares of Omnirel's common stock pursuant to Omnirel's 1995
Non-Qualified Stock Option Exchange Plan. Also in March 1995 in
exchange for their release of rights to participate in the MIRP and
concurrently with the grant of options to Omnirel's president, Omnirel
granted to other executive employees options to purchase up to an
aggregate of 34,000 shares of Omnirel's common stock pursuant to
Omnirel's 1995 Non-Qualified Stock Option Plan. As a result of such
exchange of shares and the option grants described above, the
Company's direct ownership of Omnirel's outstanding shares increased
from approximately 96% to approximately 98%; and, on a fully diluted
basis, the Company's ownership of Omnirel could be reduced to
approximately 84%.
Properties
----------
The Company leases 750 square feet at a modern office building
located in Valhalla, New York, where it maintains its executive
offices. The Company pays an annual rent of $15,000 for the Valhalla
space. The lease term expires on October 31, 1996. The Company uses
all of the leased space.
Omnirel owns a 6.5 acre parcel of land with a 38,000 square foot,
one story, modern facility located in Leominster, Massachusetts, where
Omnirel manufactures its products in a clean-room environment.
Omnirel's processes are certified to MIL-STD 1772 and registered to
ISO 9001. Approximately 12,000 square feet of the Company's facility
is rated and certified as a class 10,000 clean-room environment. This
location houses all of the operations of Omnirel Corporation. This
clean room facility is equipped with design, manufacturing, electrical
test and environment screen equipment which are state-of-the-art.
Substantially all of Omnirel's facility is productively in use.
11
<PAGE>
TACTech is currently leasing a facility in Yorba Linda,
California from Arrow Electronics on a month-to-month basis at a cost
of $3,500 per month. Approximately 40% of TACTech's facility is in
productive use.
The Company does not currently have a formal policy in place
specifically addressing investments in real estate and real estate
related products. However, the Company's general investment
objectives are to invest a majority of its available funds in
relatively low risk liquid investments or publicly traded securities
and to achieve a maximum aggregate return comprised of both capital
appreciation and income distributions consistent with such
investments. Although such investments may include real estate and
real estate related products, other than the real property described
above, they currently do not. The Company can alter its investment
policies and investment portfolio at anytime without shareholder
consent.
12
<PAGE>
MANAGEMENT
Directors
---------
The names and ages of all Directors of the Company, their
positions with the Company, their term of office and their business
background are set forth below:
Director of
Name, Age, Principal Occupation, Other Directorships Zing Since
---------------------------------------------------- -----------
JOHN F. CATRAMBONE, 55, has been President and Chairman 1986
of the Board of Omnirel Corporation, a manufacturer of
power hybrid semiconductor devices since 1985. Omnirel has
been a subsidiary of the Company since June 1991.
MARTIN S. FAWER, 61, became Chief Financial Officer and 1984
Treasurer in February 1988. From October 1984 to January
1988 Mr. Fawer was Treasurer of the Company. He is also the
Chief Financial Officer and Treasurer of TACTech and Omnirel,
as well as a director of each such entity. For more than
five years, Mr. Fawer has been a principal of Fawer and Kupczyk,
P.C. and its predecessors, certified public accountants.
LAURENCE W. HIGGITT, 48, has been employed by Stephen Rose & 1985
Partners, Limited, investment bankers, in London, England
since 1984 and has been on its Board of Directors since 1985.
Prior to 1984, he was a fund manager for Lazard Brothers
& Co. Ltd., merchant bankers, London, England.
DEBORAH J. SCHRADER, 48, has been Secretary of the Company 1969
since its incorporation. She is also the Secretary and a
director of TACTech, a subsidiary of the Company. She is
the wife of Robert E. Schrader.
ROBERT E. SCHRADER, 51, is the founder of the Company and 1969
has been President and Chief Executive Officer since its
incorporation in 1969. Prior to organizing the Company,
Mr. Schrader was an account executive with a division of
Lafayette Radio Corporation, a district sales manager of
Arrow Electronics, Inc. and held purchasing manager positions
with two electronic equipment manufacturers. He is also a
director and the president of TACTech and Omnirel Corporation,
each a subsidiary of the Company. He is the husband of
Deborah J. Schrader.
HENRY A. SINGER, 58, has been a member of the law firm of 1988
Morrison Cohen Singer & Weinstein, LLP and its predecessor
for more than the past five years. Morrison Cohen Singer &
Weinstein, LLP serves as general counsel to the Company.
The Company's Certificate of Incorporation divides the Board of
Directors into two classes, with regular two-year staggered terms.
Messrs. Singer, Catrambone and Higgitt are currently up for re-
election for a two-year term.
13
<PAGE>
No director is a director of any company with a class of
securities registered pursuant to Section 12 of the Act or of any
company registered as an Investment Company under the Investment
Company Act of 1940. Other than Robert E. Schrader and Deborah J.
Schrader, who are married to each other, there is no family
relationship among any of the members of the Board of Directors or the
officers of the Company.
In June 1990, the Securities and Exchange Commission filed a
civil suit against Henry A. Singer alleging that in August and
November of 1987 he purchased shares of common stock of a company
listed on the New York Stock Exchange based upon material non-public
information. In July 1990, Mr. Singer denied these allegations except
that he admitted the fact of his purchase of the shares of such
company and the sale for a profit of approximately $34,000 in April
1988. In November 1992, Mr. Singer and the Commission settled the
civil action, and, without admitting or denying the allegations in the
complaint, Mr. Singer consented to the entry of a final judgment of
permanent injunction against his violating securities laws in future
trading of any securities. In connection therewith, Mr. Singer paid
$34,050, representing the profits from the transaction described in
the complaint, together with interest thereon, as well as a civil
money penalty in the same amount.
Executive Officers
------------------
Position with Company and Business
Name Age Experience During Past Five Years
---- --- ----------------------------------
Robert E. Schrader*
Deborah J. Schrader*
Martin S. Fawer*
John F. Catrambone*
Malcolm Baca 54 Executive Vice President and
Treasurer of the Company's
TACTech subsidiary since 1987.
-----------------------
* See "Directors" above.
Based upon an examination of Forms 3, 4 and 5 furnished to the
registrant in respect of the 1995 Fiscal Year, no persons have failed
timely to file any of the foregoing forms in respect of transactions
in such year or in respect of a prior year.
Compensation of Directors
-------------------------
The Company pays each director who is not an officer or employee
of the company (other than Henry A. Singer) $4,000 per year for his
services as a director plus $250 for each Board of Directors meeting
attended and for each Committee meeting attended if not held on the
same day as a Board meeting. Mr. Singer does not receive such fee,
since the firm of which he is a partner is paid its customary legal
fees for Mr. Singer's attendance and participation. Such firm was
paid $246,550 for legal services rendered to the Company for the 1995
Fiscal Year, of which $5,200 was paid in respect of Mr. Singer's
attendance at Board and Committee Meetings. See "Compensation
---
Committee Interlocks and Insider Participation", below.
Executive Compensation
----------------------
The following table shows, for the three most recently ended
fiscal years, the cash compensation paid or accrued for those years to
the Chief Executive Officer of the Company and to each of the four
most highly
14
<PAGE>
compensated executive officers of the Company other than the Chief
Executive Officer whose aggregate annual salary and bonus paid in
compensation for services rendered in all the capacities in which they
served exceeded $100,000 for the Company's Fiscal Year 1994 (the
"Named Executives"):
<TABLE>
<CAPTION>
Summary Compensation Table
Long-Term Compensation
--------------------------------------
Annual Compensation Awards Payouts
-------------------- ---------------------- -------
Securities
Name and Other Restricted Underlying All Other
Principal Annual Stock Options/ LTIP Compensation(2)
Position Year(1) Salary($) Bonus($) Compensation($) Awards($) SARs (#) Payouts($) ($)
- -------- ---- --------- -------- --------------- --------- ----------- ---------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Robert E. Schrader 1993 220,600 1,481
President, Chief Executive 1994 162,500 1,800
Officer and Chairman of the 1995 150,000 1,800
Board
John F. Catrambone(3) 1993 163,625 2,043
President of Omnirel 1994 207,504 50,000 3,054
Corporation 1995 207,500 100,000 3,714
Malcolm Baca 1993 111,754 783
Vice President and Treasurer 1994 161,479 1,044
of TACTech 1995 168,788 1,044
Martin S. Fawer 1993 75,126 --
Chief Financial Officer and 1994 99,450 --
Treasurer 1995 75,000 389,996(4)
</TABLE>
- -------------------------
(1)On May 19, 1993 the Company's Board of Directors voted to change the
Company's fiscal year end to June 30 from September 30. Information for the
1993 Fiscal Year is for the nine months ended June 30, 1993.
(2)The amounts reflect the following payments of annual life insurance
premiums in the 1994 Fiscal Year: $1,800 on behalf of Mr. Robert E. Schrader,
$3,054 on behalf of Mr. John Catrambone and $1,044 on behalf of Mr. Malcolm
Baca.
(3)The salary amounts for Mr. Catrambone in each of 1993, 1994 and 1995
include (i) $16,875, $22,500 and $22,500, respectively, representing interest
imputed at 9% per annum on the $250,000 interest free loan provided by the
Company to Mr. Catrambone for the purchase of the Company's common stock,
and (ii) a contractually required annual bonus of $60,000. See "Employment
Contracts and Termination of Employment and Change-of-Control Agreements"
below.
(4)This amount reflects the net proceeds paid to Mr. Fawer upon the
exercise of his 41,857 Warrants.
The above amounts do not include certain personal benefits, which do not
exceed, as to any executive officer identified above, 10% of his total Annual
Compensation.
15
<PAGE>
Grants of Warrants
- ------------------
During the 1995 Fiscal Year no warrants, options or Stock
Appreciation Rights were granted to any Named Executive of the
Company.
<TABLE><CAPTION>
Aggregated Warrant Exercises in Last Fiscal Year
and Fiscal Year-End Warrant Values
Value of Unexercised
Shares Number of Unexercised In-the-Money
Acquired Option/SARs at Option/SARs at
on Value FY-End (#) FY-End ($)
Name Exercise(#) Realized($) ---------------------- --------------------
- ---- ----------- ----------- Exercisable Unexercisable Exercisable(1) Unexercisable
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C>
John F. Catrambone 3,000 $33,292
Martin S. Fawer 41,857 $389,996
</TABLE>
- ------------------------------------
(1) Based on the fair market value per share of the
Common Stock of $12.4375, which was the closing
bid price of the Common Stock as reported by the
National Association of Securities Dealers, Inc.
on June 30, 1995.
Employment Contracts and Termination of Employment and Change-In-
----------------------------------------------------------------------
Control Arrangements
--------------------
John Catrambone has an employment agreement with the Company's
Omnirel subsidiary. The five year agreement, expiring in June of
1996, provides for a base salary of $125,000 per year, a guaranteed
bonus of $60,000 per year and an incentive bonus linked to a set of
performance criteria determined annually by Omnirel's Board of
Directors and subject to percentage limitations of Mr. Catrambone's
base salary (80% for 1995). Mr. Catrambone was loaned $300,000,
without interest, by the Company in connection with the purchase of
Omnirel by the Company. The Company has guaranteed to Mr. Catrambone
the base compensation payments under such employment agreement and
pays the $60,000 annual bonus, which is used by Mr. Catrambone to
repay such loan. The Company also loaned Mr. Catrambone $250,000,
without interest, to purchase shares of the Company's common stock.
Such loan, which is due in June, 2001, is secured by the stock so
purchased by Mr. Catrambone. Through September 30, 1995, Mr.
Catrambone sold 14,500 shares of the Company's Common Stock, and
pursuant to his agreement with the Company, he paid down his $250,000
loan with the Company by $80,000.
During the end of calendar year 1994 and the beginning of
calendar year 1995, the Company negotiated with Mr. Catrambone and key
employees of Omnirel with respect to terminating Omnirel's existing
Management Incentive Plan ("MIP") and revising the ownership structure
of Omnirel. In March, 1995, the MIP was canceled and the MIP
participants received in exchange for their MIP interests ( on a pro
rata basis to their participation in the MIP) options to purchase
61,818 shares of Omnirel common stock exercisable at $8.00 per share.
In addition Mr. Catrambone exchanged 2,000 existing options
exercisable at $6.50 per share and 18,872.4 shares of Omnirel common
stock owned by him for 72,182 new ten year options for Omnirel stock
exercisable at $8.00 per share. These options were issued pursuant to
a new non-qualified stock option exchange plan. The purpose of these
transactions was to exchange for management's existing rights and
securities, securities of equal value to that which management and Mr.
Catrambone gave up while at the same time creating longer term
incentives for Omnirel management to grow its business. In March,
1995, 45,000 options to purchase Omnirel stock exercisable at $8.00
per share were granted to new and old members of Omnirel management to
further incentivize management. Such 45,000 options were granted
pursuant to a new non-qualified stock option plan.
Malcolm Baca has an employment agreement with the Company's
TACTech subsidiary. The term of Mr. Baca's employment is to expire on
May 1, 1997. Mr. Baca's agreement entitles him to a salary of
$120,000 per annum, plus five percent (5%) of TACTech's collected
revenues in each year, except that on revenues attributable to another
commissioned member of TACTech's management Mr. Baca's commission is
two and one-half percent (2 1/2%). Effective as from the middle of the
1995 fiscal year, all commissions to Mr. Baca are subject to his
required contribution of one-half of one percent (1/2%) of TACTech's
collected revenues to a bonus pool fund for the benefit of non-
commissioned members of management, which contribution is matched by
TACTech. Mr. Baca does not participate in such bonus pool fund. In
addition to other customary terms, pursuant to the agreement, Mr.
Baca's compensation is subject to a $350,000 per annum maximum. The
annual maximum is subject to increase based upon the National Consumer
Price Index. In the event Mr. Baca is terminated without good cause,
TACTech is obligated to continue to pay compensation to Mr. Baca
through April 30, 1997.
16
<PAGE>
Mr. Schrader does not have an employment agreement with the
Company and his compensation is set by the Compensation Committee
subject to the approval of the Board of Directors. In connection with
the 1993 sale of the Company's high reliability electronic component
distribution and value-added businesses to Arrow Electronics, Inc.,
Mr. Robert E. Schrader entered into a Consulting and Non-Competition
Agreement with Arrow. As a consequence of such agreements, Mr.
Schrader does not devote his full time to the Company. Pursuant to
the terms of his agreement with Arrow, Mr. Schrader is required to
devote up to five business days per quarter to the business of Arrow.
Certain Transactions
--------------------
Mr. Singer, a director of the Company during the 1995 Fiscal
Year, is a partner at the law firm of Morrison Cohen Singer &
Weinstein, LLP, counsel to the Company. Such firm received $179,548
for legal services rendered on behalf of the Company during the 1994
Fiscal Year, of which $5,491.50 was paid in respect of Mr. Singer's
attendance at Board and Committee meetings. During Fiscal Year 1993,
the same firm received $214,914 for legal services rendered on behalf
of the Company, of which $5,600 was paid in respect of Mr. Singer's
attendance at Board and Committee meetings.
17
<PAGE>
COMMON STOCK
The authorized capital stock of the Company consists of
12,000,000 shares of Common Stock. At July 27, 1997, there were
2,597,497 shares of Common Stock outstanding, 81 holders of record and
at least 630 beneficial owners.
Holders of Common Stock are entitled to cast one vote for each
share held at all shareholder meetings for all purposes, including the
election of directors and to receive dividends as may be declared from
time to time by the Board of Directors out of funds legally available
therefor. In the event of liquidation, dissolution or winding up of
the Company, the holders of Common Stock are entitled to share ratably
in the assets remaining after payment of liabilities. Holders of
Common Stock have no preemptive or conversion rights and their stock
is not subject to further calls or assessments by the Company. There
are no redemption or sinking fund provisions applicable to the Common
Stock. The Common Stock currently outstanding is, and the Common
Stock to be issued upon exercise of a Warrant will be, upon payment of
the Warrant exercise price, validly issued, fully paid and
nonassessable.
The Company's Certificate of Incorporation and By-laws provide
for a Board of Directors consisting of not fewer than six nor more
than ten members, classified into three classes if there shall be nine
or more directors, or two classes if there shall be fewer than nine
directors in either case with each class being as nearly as possible
equal in size to the others, and with at least three directors in each
class. The terms of each class are staggered.
Except for transactions approved by the Board of Directors, the
Company's Certificate of Incorporation requires the affirmative vote
of at least 66 2/3% of the shares entitled to vote on certain mergers,
consolidations and sales, leases or exchanges of assets in cases where
the offeror controls more than 10% of the Common Stock of the Company.
The Common Stock of the Company is traded on NASDAQ-NMS, under
the symbol ZING. The following table sets forth the high and low
closing sales prices of the Company's Common Stock on the NMS for each
quarterly period during the last two fiscal years.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------
High Low
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
1st Quarter Fiscal Year '94 2 1/2 1 7/8
2nd Quarter Fiscal Year '94 2 1/4 1 5/8
3rd Quarter Fiscal Year '94 2 1/4 1 7/8
4th Quarter Fiscal Year '94 2 1/4 1 3/4
1st Quarter Fiscal Year '95 2 1/2 1 7/8
2nd Quarter Fiscal Year '95 6 3/4 2 1/16
3rd Quarter Fiscal Year '95 10 1/4 4 5/8
4th Quarter Fiscal Year '95 12 7/8 6 5/8
1st Quarter Fiscal Year '96 26 1/2 12 1/8
</TABLE>
18
<PAGE>
No cash dividends have been declared on the Company's Common
Stock for the fiscal years ended June 30, 1995 and 1994. The present
policy of the Company is to retain earnings to provide funds for the
operations and expansion of its business.
The Transfer Agent and Registrar for the Common Stock is Mellon
Securities Transfer Services.
19
<PAGE>
SECURITY OWNERSHIP
Principal Security Holders
- --------------------------
The following table sets forth, as at November 1, 1995,
information concerning the beneficial ownership of voting securities
of the Company by each person who is known by management to own
beneficially more than 5% of any class of such securities:
Amount
Title of Name and Address Beneficially Percent
Class of Beneficial Owner Owned of Class
- ----------- ----------------------------- ---------------- -------------
Common Robert E. Schrader 1,152,711 44.4%
72 Haight Cross Road
Chappaqua, NY 10514
Common Jesse Greenfield* 227,350 8.3%
3765 Wild Palm Court
Boulder, CO 80434
_____________________________
* Information with respect to beneficial interest of the holder is
based on the most recent Schedule 13D or Schedule 13G delivered
to the Company by such holder and not on the basis of any
independent information with respect to such holdings which the
Company may possess.
Management
- ----------
The following table sets forth, as at November 1, 1995,
information concerning the beneficial ownership of each class of
equity securities of the Company and its subsidiaries beneficially
owned by all directors and officers of the Company and its
subsidiaries:
20
<PAGE>
<TABLE>
<CAPTION>
Amount
Name and Address Beneficially Percent
Title of Class of Beneficial Owner Owned of Class(2)
------------------ ---------------------------------------- ----------------- ----------------
<S> <C> <C> <C>
Common John F. Catrambone 87,000(1) 3.3
167 South Street
Carlisle, MA 01741
Common Martin S. Fawer 89,736 3.5
860 Fifth Avenue
New York, NY 10021
Common Laurence W. Higgitt 3,000(1) *
Arossa Pilmer Road
Corwborough East Sussex
ENGLAND CN6 ZUG
Common Henry A. Singer 3,000(1) *
c/o Morrison Cohen Singer
& Weinstein, LLP
750 Lexington Avenue
New York, NY 10022
Common Robert E. Schrader 1,152,711 44.4
72 Haights Cross Road
Chappaqua, NY 10514
Common Deborah J. Schrader 0 0%
72 Haights Cross Road
Chappaqua, NY 10514
Common Malcolm Baca 0 0%
24611 Catalonia Circle
Mission Viejo, CA 92691
</TABLE>
____________________
(*) Represents less than 1% of the shares attending.
(1) Includes 3,000 shares which may be acquired upon exercise of
warrants. Mr. Singer's 3,000 warrants are held for the benefit of his
firm, Morrison Cohen Singer & Weinstein, LLP.
(2) Includes shares outstanding and shares which may be acquired upon
exercise of warrants.
21
<PAGE>
SELLING SHAREHOLDERS
Identity of Selling Shareholders; Number of Shares Offered
----------------------------------------------------------
The following table sets forth (i) the name of each Selling
Shareholder, (ii) the nature of any position, office, or other
material relationship which each such Selling Shareholder has had with
the Company or any of its affiliates within the last three years,
(iii) the number of shares of Common Stock owned by each such Selling
Shareholder prior to the offering, (iv) the number of shares of Common
Stock offered for each such Selling Shareholder's account, and (v) the
number of shares of Common Stock and the percentage owned by each such
Selling Shareholder after completion of the offering, assuming all
Shares offered pursuant to this Prospectus are sold.
<TABLE>
<CAPTION>
Number of Shares
Owned of Record
Relationship Total Shares Number of Shares After The Offering,
Selling To Owned Prior to Offered for Selling Assuming That All
Shareholder The Company* Offering Shareholder's Account Shares Are Sold Percent
----------- ----------- -------------- --------------------- ------------------- -------
<S> <C> <C> <C> <C> <C>
John Burrows 23,034(1) 23,034 0 **
Joseph Camarda 35,582 35,582 0 **
John F. Catrambone Director 87,000(2) 3,000 84,000 3.8%
Michael Decesare 4,666(3) 4,666 0 **
Martin S. Fawer Director 89,736 41,857 50,879 2%
Laurence W. Higgitt Director 3,000(2) 3,000 0 **
Gordon Leith 7,500 7,500 0 **
Thomas Ross 7,500(4) 7,500 0 **
Dorothy Schrader 1,762(5) 1,762 0 **
Wayne Schrader 44,012(6) 44,012 0 **
Eugene Sheinman 16,905 16,905 0 **
Henry A. Singer Director 3,000*(2) 3,000 0 **
William Toumey 7,500(4) 7,500 0 **
</TABLE>
- ------------------------------
1 Includes 23,034 shares which may be acquired upon exercise of
Warrants.
2 Includes 3,000 shares which may be acquired upon exercise of
Warrants.
3 Includes 4,666 shares which may be acquired upon exercise of
Warrants.
4 Includes 7,500 shares which may be acquired upon exercise of
Warrants.
5 Includes 1,762 shares which may be acquired upon exercise of
Warrants.
6 Includes 44,012 shares which may be acquired upon exercise of
Warrants.
* See narratives below further describing the relationships between
each selling shareholder and the Company and its affiliates.
** Represents less than 1% of the Shares Outstanding.
22
<PAGE>
John F. Catrambone is a director of the Company and has been
President, Chief Executive Officer of Omnirel Corporation since 1985.
Omnirel has been a subsidiary of the Company since June 1991.
Martin S. Fawer is a director of the Company. He became Chief
Financial Officer and Treasurer in February 1988. From October 1984
to January 1988 Mr. Fawer was Treasurer of the Company. He is also a
director of TACTech and Omnirel, and serves as Chief Financial Officer
and Treasurer of both.
Laurence W. Higgitt has been a director of the Company since
1985.
Henry A. Singer has been a director of the Company since 1988.
He has been a member of the law firm of Morrison Cohen Singer &
Weinstein, LLP and its predecessor for more than three years.
Morrison Cohen Singer & Weinstein, LLP serves as general counsel to
the Company.
Messrs. Burrows, Camarda, Leith, and Sheinman were all Vice
Presidents of the Company whose employments were terminated in May
1993 in connection with the Arrow Sale. Messrs. Camarda, Burrows, and
Wayne Schrader were also Directors of the Company prior to the Arrow
Sale.
Wayne Schrader was a Senior Vice President of the Company. His
employment was terminated in May 1993 in connection with the Arrow
Sale.
Thomas Ross was the Comptroller of the Company until December
1993 when he left the employment of the Company.
Dorothy Schrader was an employee of the Company until May 1993,
when she left the employment of the Company.
Michael Decesare was an employee of the Company until July 31,
1990, when he left the employment of the Company.
William Toumey was an employee with the Company until May 19,
1993, at which time the Arrow Sale was completed; he is currently
employed by Arrow.
23
<PAGE>
PLAN OF DISTRIBUTION/SALE OF SHARES
The sales of the Shares by the Selling Shareholders may be
effected, from time to time, on the NASDAQ National Market System or
on any stock exchange on which the Shares may be listed at the time of
sale, in negotiated transactions, or through a combination of such
methods of sale, at fixed prices which may be changed, at market
prices prevailing at the time of sale, at prices related to such
prevailing market prices, or at negotiated prices. The Selling
Shareholders may effect such transactions by selling Shares to or
through broker-dealers, and such broker-dealers may receive
compensation in the form of discounts, concessions, or commissions
from the Selling Shareholders and/or the purchasers of Shares (which
compensation as to a particular broker-dealer might be in excess of
customary commissions).
The Selling Shareholders and any broker-dealers that act in
connection with the sale of the Shares hereunder might be deemed to be
"Underwriters" within the meaning of Section 2(11) of the Securities
Act; any commissions received by them and any profit on the resale of
Shares as principal might be deemed to be underwriting compensation
under the Securities Act.
Any broker-dealer acquiring Shares from a Selling Shareholder may
sell the Shares either directly, in its normal market-making
activities, through or to other brokers on a principal or agency
basis, or to its customers. Any such sales may be at prices then
prevailing on the NASDAQ National Market System, at prices related to
such prevailing market prices, at negotiated prices, or a combination
of such methods.
The Company has advised the Selling Shareholders that anti-
manipulative Rules 10b-2, 10b-6 and 10b-7 under the Exchange Act may
apply to their sales in the market, has furnished the Selling
Shareholders with a copy of these Rules and has informed the Selling
Shareholders of the possible need for them to deliver copies of this
Prospectus. The Selling Shareholders may indemnify any broker-dealer
that participates in transactions involving the sale of the Shares
against certain liabilities, including liabilities arising under the
Securities Act. Any commissions paid or any discounts or concessions
allowed to any such broker-dealers, and, if any such broker-dealers
purchase Shares as principal, any profits received on the resale of
such Shares, may be deemed to be underwriting discounts and
commissions under the Securities Act.
Upon the Company's being notified by any Selling Shareholder that
any material arrangement has been entered into with a broker-dealer
for the sale of Shares through a cross or block trade, a supplemental
prospectus will be filed under Rule 424(c) under the Securities Act,
setting forth the name of the participating broker-dealer(s), the
number of Shares involved, the price at which such Shares were sold by
the Selling Shareholder, the commissions paid or discounts or
concessions allowed by the Selling Shareholder to such broker-
dealer(s), and where applicable, that such broker-dealer(s) did not
conduct any investigation to verify the information set out in this
Prospectus.
24
<PAGE>
Any Shares which qualify for sale pursuant to Rule 144 under the
Securities Act may be sold under that Rule rather than pursuant to
this Prospectus.
There can be no assurances that the Selling Shareholders will
sell any or all of the Shares offered by them hereunder.
Expenses of the registration of the Shares, up to $.15 per share,
will be paid for by the Selling Shareholders. Expenses of
registration in excess of $.15 per Share, if any, shall be borne by
the Company.
USE OF PROCEEDS
The Company will not realize any proceeds from the sale of the
Shares which may be sold under this Prospectus for the respective
accounts of each of the Selling Shareholders. The Company, however,
will derive proceeds of approximately $130,981 if all of the currently
unexercised warrants are exercised. Such proceeds will be available
to the Company for working capital and general corporate purposes. No
assurance can be given, however, as to when or if any or all of the
Warrants will be exercised. See "Selling Shareholders" and "Plan of
Distribution/Sale of Shares".
LEGAL MATTERS
The legality of the Shares offered by this Prospectus has been
passed upon for the Company by Morrison Cohen Singer & Weinstein, LLP,
750 Lexington Avenue, New York, New York 10022.
EXPERTS
The consolidated financial statements and schedules of the
Company appearing in the Company's Annual Report on Form 10-K for the
year ended June 30, 1995, have been audited by Ernst & Young LLP,
independent auditors, as set forth in their report thereon included
therein and incorporated herein by reference . Such consolidated
financial statements are incorporated herein by reference in reliance
upon such report given upon the authority of such firm as experts in
accounting and auditing.
25
<PAGE>
INDEMNIFICATION
Sections 721 to 725 of the New York Business Corporation Law
("NYBCL") permit indemnification of directors, officers, and employees
of corporations under certain circumstances and subject to certain
limitations. Section 726 of the NYBCL permits the purchase of
insurance to indemnify the corporation and its officers and directors,
subject to certain limitations. Section 402(b) of the NYBCL permits
the inclusion of a provision in the certificate of incorporation of a
corporation eliminating or limiting the personal liability of
directors to the corporation or its shareholders for damages for any
breach of duty in such capacity, subject to certain limitations.
Article SEVEN, Section 7.1 of the Company's By-laws, as amended
through February 26, 1987, provides that the Company shall indemnify
each director and officer of the Company elected, appointed, or
continuing to serve after the adoption of Article SEVEN of the By-
laws, and may indemnify all other persons whom the Company is
authorized to indemnify under the provisions of the NYBCL, to the
fullest extent permitted by law, against all legal, accounting, and
other expenses and liabilities incurred in connection with any pending
or threatened action, suit, or proceeding, civil or criminal, or in
connection with any appeal therein, or otherwise, and no provision of
the By-laws is intended to be construed as limiting, prohibiting,
denying, or abrogating any of the general or specific powers or rights
conferred under the NYBCL upon the Company to furnish, or upon any
court to award, such indemnification, or indemnification as otherwise
authorized by the NYBCL or other law now or hereafter in effect.
Article NINTH of the Company's Certificate of Incorporation
provides that, except as otherwise specifically provided, no provision
of the Company's Certificate of Incorporation is intended to be
construed as limiting, prohibiting or denying any of the general or
specific powers or rights conferred under the NYBCL, including, in
particular, the power of the Company to furnish officers, directors
and other Company personnel with indemnification.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers or controlling
persons of the registrant pursuant to the foregoing provisions, the
registrant has been informed that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as
expressed in the Securities Act and is therefore unenforceable.
26
<PAGE>
INDEX TO FINANCIAL INFORMATION
ZING TECHNOLOGIES, INC. AND SUBSIDIARIES
*Incorporated by reference to the Company's Annual Report
on Form 10-K for the year ended June 30, 1995.
Page
----
Report of Independent Accountants . . . . . . . . . . . . . . . . . *
Consolidated Balance Sheets at June 30, 1995 . . . . . . . . . . . *
Consolidated Statements of Income for the Years Ended
June 30, 1994 and 1995 . . . . . . . . . . . . . . . . . . . . . *
Consolidated Statements of Shareholders Equity for the Years
Ended June 30, 1994 and 1995 . . . . . . . . . . . . . . . . . . *
Consolidated Statements of Cash Flows for Years Ended
June 30, 1994 and 1995 . . . . . . . . . . . . . . . . . . . . . *
Notes to Consolidated Financial Statements . . . . . . . . . . . . *
27
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Sections 721 to 725 of the New York Business Corporation Law
("NYBCL") permit indemnification of directors, officers, and employees
of corporations under certain circumstances and subject to certain
limitations. Section 726 of the NYBCL permits the purchase of
insurance to indemnify the corporation and its officers and directors,
subject to certain limitations. Section 402(b) of the NYBCL permits
the inclusion of a provision in the certificate of incorporation of a
corporation eliminating or limiting the personal liability of
directors to the corporation or its shareholders for damages for any
breach of duty in such capacity, subject to certain limitations.
Article SEVEN, Section 7.1, of the Company's By-laws, as amended
through February 26, 1987, provides that the Company shall indemnify
each director and officer of the Company elected, appointed, or
continuing to serve after the adoption of Article SEVEN of the By-
laws, and may indemnify all other persons whom the Company is
authorized to indemnify under the provisions of the NYBCL, to the
fullest extent permitted by law, against all legal, accounting, and
other expenses and liabilities incurred in connection with any pending
or threatened action, suit, or proceeding, civil or criminal, or in
connection with any appeal therein, or otherwise, and no provision of
the By-laws is intended to be construed as limiting, prohibiting,
denying, or abrogating any of the general or specific powers or rights
conferred under the NYBCL upon the Company to furnish, or upon any
court to award, such indemnification, or indemnification as otherwise
authorized by the NYBCL or other law now or hereafter in effect.
Article NINTH of the Company's Certificate of Incorporation
provides that, except as otherwise specifically provided, no provision
of the Company's Certificate of Incorporation is intended to be
construed as limiting, prohibiting or denying any of the general or
specific powers or rights conferred under the NYBCL, including, in
particular, the power of the Company to furnish officers, directors
and other Company personnel with indemnification.
II-1
<PAGE>
ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Estimated Legal Fees $30,000
Estimated Accounting Fees $10,000
Registration Fees $945.04
ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES.
In June of 1995, Marty Fawer exercised his warrants to purchase
41,857 shares of Common Stock of the Company at $1.34 per share. The
warrants were offered to Mr. Fawer by the Company without registration
by relying on the exemption available under Section 4(2) of the
Securities Act of 1933, as amended.
ITEM 27. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
NOTE: Exhibits marked with one asterisk are incorporated by
reference to Amendment No. 1 to the Registrant's
Registration Statement on Form S-1 (Registration No. 2-
93940) filed with the Securities Exchange Commission (the
"SEC") on February 26, 1985; exhibits marked with two
asterisks are incorporated by reference to Amendment No. 2
to the Registrant's Registration Statement on Form S-1
(Registration No. 2-93940) filed with the SEC on March 21,
1985; exhibits marked with three asterisks are incorporated
by reference to the Registrant's Form 8-K filed with the SEC
on February 13, 1993.
3(i)(1) Restated Certificate of Incorporation, filed with the New
York Secretary of State on October 31, 1984.*
(2) Certificate of Amendment of the Certificate of
Incorporation, filed with the New York Secretary of State
on March 15, 1985.**
(3) Certificate of Amendment of the Certificate of
Incorporation, filed with the New York Secretary of State
on June 9, 1987.
(4) Certificate of Amendment of the Certificate of Incorporation,
filed with the New York Secretary of State on June 16, 1993.
3(ii)(1) By-Laws
5. Opinion of Morrison Cohen Singer & Weinstein, LLP, as to the
legality of the securities being registered.
10 Asset Purchase Agreement, dated as of February 12, 1993, and
among the Registrant, certain of its subsidiaries, and Arrow
Electronics, Inc.***
21. Subsidiaries of Registrant
II-2
<PAGE>
23.1 Consent of Ernst & Young LLP
23.2 Consent of Morrison Cohen Singer & Weinstein, LLP
(contained in its Opinion filed as part of Exhibit 5)
24. Powers of Attorney (included on the signature page of the
registration statement filed November 8, 1995)
ITEM 28. UNDERTAKINGS
A. The undersigned registrant hereby undertakes:
(1) To file, during any period in which it offers or sells
securities, a post-effective amendment to this registration statement
to:
(i) Include any prospectus required by Section
10(a)(3) of the Securities Act of 1933, as amended ("Securities Act");
(ii) Reflect in the prospectus any facts or events
which, individually or together, represent a fundamental change in the
information in the registration statement. Notwithstanding the
foregoing, any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
a 20 percent change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
registration statement.
(iii) Include any additional or changed material
information on the plan of distribution.
(2) For purposes of determining liability under the
Securities Act, to treat each post-effective amendment as a new
registration statement of the securities offered, and the offering of
the securities at that time to be the initial bona fide offering.
(3) To file a post-effective amendment to remove from
registration any of the securities that remain unsold at the end of
the offering.
B. Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the small business issuer pursuant to the foregoing
provisions, or otherwise, the small business issuer has been advised
that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the
payment by the small business issuer of
II-3
<PAGE>
expenses incurred or paid by a director, officer or controlling person
of the small business issuer in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered,
the small business issuer will, unless in the opinion of its counsel
the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such
issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
as amended, the Registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form SB-2
and has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the Village
of Valhalla, State of New York, on this 8th day of November, 1995.
ZING TECHNOLOGIES, INC.
By: /s/ Robert E. Schrader
--------------------------------------
Robert E. Schrader,
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints Robert E. Schrader
and Martin S. Fawer or either of them, each with the power of
substitution, his or her attorney-in-fact, to sign any amendments to
this Registration Statement and to file the same, with exhibits
thereto and other documents in connection therewith, with the
Securities and Exchange Commission, hereby ratifying and confirming
all that each of said attorney-in-fact, or his or her substitute, may
do or choose to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933,
as amended, this Registration Statement has been signed below by the
following persons in the capacities and on the dates indicated:
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Robert E. Schrader President and Chief Executive November 8, 1995
- ------------------------
Robert E. Schrader Officer
/s/ John F. Catrambone Director November 8, 1995
- ----------------------
John F. Catrambone
/s/ Martin S. Fawer Chief Financial Officer, November 8, 1995
- -------------------
Martin S. Fawer Treasurer and Director
Director
- -----------------------
Laurence W. Higgitt
/s/ Deborah J. Schrader Secretary and Director November 8, 1995
- -----------------------
Deborah J. Schrader
/s/ Henry A. Singer Director November 8, 1995
- -------------------
Henry A. Singer
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT INDEX
Exhibit No. Description Page
- ---------- ----------- ----
<C> <S> <C>
3(i)(1) Restated Certificate of Incorporation, filed with the New York *
Secretary of State on October 31, 1984.
(2) Certificate of Amendment of the Certificate of Incorporation, filed **
with the New York Secretary of State on March 15, 1985.
- --(3) Certificate of Amendment of the Certificate of Incorporation, filed
with the New York Secretary of State on March 9, 1987.
- --(4) Certificate of Amendment of the Certificate of Incorporation,
filed with the New York Secretary of State on June 16, 1993.
- -- 3(ii)(1)By-Laws
- -- 5. Opinion of Morrison Cohen Singer & Weinstein, LLP, as to the legality
of the securities being registered.
10 Asset Purchase Agreement, dated as of February 12, 1993, and among the ***
Registrant, certain of its subsidiaries, and Arrow Electronics, Inc.
- -- 21. Subsidiaries of Registrant
- -- 23.1 Consent of Ernst & Young.
23.2 Consent of Morrison Cohen Singer & Weinstein, LLP
(contained in its Opinion filed as part of Exhibit 5)
24. Powers of Attorney (included on the signature page of the registration
statement filed November 7, 1995)
</TABLE>
NOTE: Exhibits marked with one asterisk are incorporated by reference to
Amendment No. 1 to the Registrant's Registration Statement Form S-1
(Registration No. 2-93940) filed with the Securities Exchange Commission
(the "SEC") in February 26, 1985; exhibits marked with two asterisks are
incorporated by reference to Amendment No. 2 to the Registrant's
Registration Statement on Form S-1 (Registration No. 2-93940) filed with
the SEC on March 21, 1985; exhibits marked with three asterisks are
incorporated by reference to the Registrant's Form 8-K filed with the SEC
on February 13, 1993.
CERTIFICATE OF AMENDMENT OF THE
CERTIFICATE OF AMENDMENT
OF
ZEUS COMPONENTS, INC.
Under Section 805 of the Business Corporation Law
We, the undersigned, being the president and secretary,
respectively, of Zeus Components, Inc. hereby certify:
1. The name of the corporation is Zeus Components, Inc.
2. The Certificate of Incorporation of Zeus Components,
Inc. was filed by the Department of State, Albany, New York, on
October 17, 1969.
The Certificate of Incorporation,
is amended, as authorized by Section 805 of the
Business Corporation Law, to effect the following amendments:
FIRST: To classify the Board into two classes, each class
to serve staggered two year terms while there are fewer
than nine directors, and thereafter into three classes,
each class to serve staggered three year terms at such time
as there are nine or more directors; and to fix the size-of
the Board at not less than six nor more than 10, the exact
number to be set by resolution of the Board;
SECOND: To provide for advance notice of shareholder
nomination for directors in the manner provided in the By
Laws;
THIRD: To restrict the right of share-
holders to fill vacancies on the Board;
FOURTH: To restrict the right of shareholders to remove
directors; and
FIFTH: To provide that any of the
.
<PAGE>
foregoing amendments may be amended or repealed only by the
same supermajority vote of shareholders required to take
the actions specified in such amendments.
4. To this effect, Article EIGHTH of the Amended and
Restated Certificate of Incorporation, dealing with voting re-
quirements on matters such as mergers and consolidation, is amended by
being renumbered Article NINTH, and a new Article
EIGHTH is hereby added to read in full as follows:
EIGHTH: The following rules shall be applicable with respect to
--------
the Board of Directors.
(a) Number, Election and Terms. The business and affairs of
the Corporation shall be managed by a Board of Directors which
shall consist of not fewer than six (6) nor more than ten (10)
persons. The exact number of directors within such minimum and
maximum limitations shall be fixed in accordance with the By-
Laws by the Board of Directors pursuant to a resolution adopted
by a majority of the total number of authorized directors
(whether or not there exist any vacancies in previously
authorized directorships at the time such resolution is
presented to the Board for adoption). No decrease in the number
of directors constituting the Board of Directors shall shorten
the term of any incumbent director. At the 1987 annual meeting
of shareholders, the directors shall be divided into two
classes, as nearly equal in number as possible (but with not
fewer than three directors in each class), with the term of
office of the first class to expire at the 1988 annual meeting
of shareholders, the term of office of the second class to
expire at the 1989 annual meeting of shareholders, and with the
members of each class to hold office until their successors
shall have been elected and qualified. At each annual meeting of
shareholders following such initial classification and election,
if at such time the number of directors on the Board is less
than nine., directors elected to succeed those directors whose
terms expire shall be elected for a term of office to expire at
the second succeeding annual meeting of shareholders after their
election. If after the
-2-
<PAGE>
1987 annual meeting of shareholders the number of directors shall be
increased to nine or more, at the next succeeding annual meeting of
shareholders after such increase, the directors shall be divided into
three classes, as nearly equal in number as possible. At such annual
meeting, one class shall be elected for a term expiring at the next annual
meeting of shareholders, the second class shall be elected for a term
expiring at the second succeeding annual meeting of shareholders, and the
third class shall be elected for a term expiring at the third succeeding
annual meeting of shareholders. At each annual meeting following that at
which the board is initially classified and elected in three classes,
directors elected to succeed those directors whose terms expire shall be
elected for a term expiring at the third succeeding annual meeting of
shareholders after their election, and until their successors shall be
elected and qualified. No increase in the number of directors shall
shorten the term of any incumbent director.
(b) Shareholder Nomination of Director Candidates. Advance notice of
shareholder nominations for the election of directors shall be given in
the manner provided in the By-laws.
(c) Newly Created Directorships and Vacancies. Newly created
directorships resulting from any increase in the authorized number of
directors and any vacancies in the Board of Directors resulting from
death, resignation, retirement, disqualification, removal from office or
other cause may be filled (i) by a majority vote of the directors then in
office even though less than a quorum, or by a sole remaining director, or
(ii) by the affirmative vote of the holders of (A) at least 66-2/3% of the
voting power of all shares entitled to vote for the election of directors
and (B) the holders of a majority of such shares other than a holder whose
beneficial interest, directly or indirectly, first equals an aggregate of
20% or more of such shares after the effective date of this Article EIGHTH
(such holders are hereinafter referred to as "Interested Shareholders").
(d). Removal. Any director, or the entire Board of Directors, may be
removed from office at any time only for cause and only (1) by the
affirmative vote of the holders of (i) at least 66-2/3% of the
-3-
<PAGE>
voting power of all of the shares of the Corporation entitled to
vote generally in the election of directors, voting together as
a single class, and (ii) a majority of such shares of Common
Stock other than shares held by Interested Shareholders, or (2)
by action of the Board.
(e) Amendment, Repeal, etc. Notwithstanding anything
contained in this Certificate of Incorporation to the contrary,
the affirmative vote of the holders of (i) at least 66-2/3% of
the voting power of all of the shares of the Corporation
entitled to vote generally in the election of directors, voting
together as a single class and (ii) a majority of such shares
other than shares held by Interested Shareholders, shall be
required to alter, amend, adopt any provision inconsistent with
or repeal this Article EIGHTH, or to alter, amend, adopt any
provisions inconsistent with or repeal Sections 3.1 ("Number,
Qualification, Election and Term of Directors"), 3.2 ("Quorum
and Manner of Acting"), 3.7 ("Resignation and Removal of
Directors") or 3.8 ("Vacancies") of Article 3 ("Board of
Directors"), or Section 6.6 ("Amendment or Repeal") of the
By-Laws of the Corporation.
5. This amendment to the Amended and Restated Certificate of
Incorporation was authorized by vote of the Board of Directors followed by
vote of a majority of shares issued and outstanding and entitled to vote
thereon taken at a meeting duly held for such purpose
IN WITNESS WHEREOF, we hereunto sign our names and
affirm that the statement made herein are true under the penalties of
perjury, this 9th day of March, 1987.
---
/s/Robert E. Schrader
------------------------------
Robert E. Schrader, President
/s/ Deborah J. Schrader, Secretary
----------------------------------
Deborah J. Schrader, Secretary
CERTIFICATE OF AMENDMENT
OF
ZEUS COMPONENTS, INC.
Under Section 805 of
the Business Corporation
Law of the State of New York
The undersigned, for purposes of amending the Certificate of
Incorporation of Zeus Components, Inc., a corporation organized under the
Business Corporation Law of the State of New York, does hereby certify
that:
1. The name of the corporation is:
ZEUS COMPONENTS, INC.
2. The date of filing of its original Certificate of Incorporation
with the Secretary of State of the State of New York was October 17, 1969
and the Restated Certificate of Incorporation was filed with the Secretary
of State of New York on October 25, 1984.
3. The Certificate of Incorporation, as amended, is hereby amended
to change the name of the Corporation to:
ZING TECHNOLOGIES, INC.
To affect the foregoing change, the Certificate of Incorporation, as
amended, is hereby amended by deleting Article FIRST thereof in its
entirety and inserting in lieu thereof the following:
"FIRST: The name of the Corporation is:
"ZING TECHNOLOGIES, INC."
<PAGE>
4. The foregoing amendment made hereby was authorized by Unanimous
Written Consent of the Corporation's Board of Directors followed by the
vote of the majority of the holders of all the outstanding shares of the
Corporation entitled to vote thereon at a meeting of shareholders on May
19, 1993.
IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Amendment of its Certificate of Incorporation to be duly adopted in
accordance with Section 803 of the Business Corporation Law of the State
of New York, and has caused this Certificate of Amendment of its
Certificate of Incorporation to be signed by its President and
Secretary this 28 day of May, 1993, and we affirm the statements
contained therein as true under penalties of perjury.
By: /s/ROBERT SCHRADER
--------------------------
ROBERT SCHRADER President
/S/ DEBORAH SCHRADER
- --------------------
DEBORAH SCHRADER
Secretary
Exhibit 3(ii)(1)
BY-LAWS
OF
ZEUS COMPONENTS, INC.
1. OFFICES.
-------
1.1 Principal Office. The principal office of the Corporation shall
----------------
be in Port Chester, County of Westchester, State of New York.
1.2 Other Offices. The Corporation may have such other offices and
-------------
places of business, within or without the State of New York, as shall be
determined by the directors.
2. MEETINGS OF SHAREHOLDERS.
------------------------
2.1 Annual Meeting. The annual meeting of stockholders for the
--------------
election of directors and the transaction of such other business as may properly
come before the meeting shall be held on the first Tuesday of March at 10:00
a.m., or on such other date and time and at such other place as is determined by
the Board of Directors (the "Board") and stated in the notice of the meeting.
(This provision was amended by the Board on July 31, 1985.)
2.2 Special Meetings. Special meetings of the stockholders may be
----------------
called by resolution of the Board or by the President and shall be called by the
President or Secretary upon the written request (stating the purpose or
purposes of the meeting) of a majority of the Board or of the holders of 66 2/3%
<PAGE>
of the outstanding shares then entitled to vote. Only business related to the
purposes set forth in the notice of the meeting may be transacted at a special
meeting.
2.3 Place of Meetings. Meetings of the shareholders may be held in
-----------------
or outside New York State.
2.4 Notice of Meetings; Waiver of Notice. Written notice of each
------------------------------------
meeting of stockholders shall be given to each stockholder entitled to vote at
the meeting; except that (a) it shall not be necessary to give notice to any
stockholder who submits a signed waiver of notice before or after the meeting,
and (b) no notice of an adjourned meeting need be given except when required by
law. Each notice of meeting shall be given, personally or by mail, not less
then 10 nor more then 50 days before the meeting and shall state the time and
place of the meeting, and unless it is the annual meeting, shall state at whose
direction the meeting is called and the purposes for which it is called. If
mailed, notice shall be considered given when mailed to a stockholder at his
address on the Corporation's records. The attendance of any stockholder at a
meeting, without protesting before the end of the meeting the lack of notice of
the meeting, shall constitute a waiver of notice by him.
2.5 Quorum. The presence in person or by proxy of the holders of a
------
majority of the shares entitled to vote shall constitute a quorum for the
transaction of any business. In the absence of a quorum a majority in voting
interest of those
-2-
<PAGE>
present in person or by proxy and entitled to vote, or, in the absence of all
the stockholders, any officer entitled to preside at or to act as Secretary of
the meeting, may adjourn the meeting until a quorum is present. At any
adjourned meeting at which a quorum is present any action may be taken which
might have been taken at the meeting as originally called. (This provision was
amended by the Board on February 26, 1987)
2.6 Voting; Proxies. Each stockholder of record shall be entitled to
---------------
one vote for every share registered in his name and may attend meetings and vote
either in person or by proxy. Corporate action to be taken by stockholder vote,
other than the election of directors, shall be authorized by a majority of the
votes cast at a meeting of stockholders, except as otherwise provided by law or
the Certificate of Incorporation. Directors shall be elected in the manner
provided in Section 3.1 of these By-Laws. Voting need not be by ballot unless
requested by a stockholder at the meeting or ordered by the Chairman of the
meeting. Every proxy must be signed by the stockholder or his attorney-in-fact.
No proxy shall be valid after eleven months from its date unless it provides
otherwise.
2.7 Action by Written Consent of Stockholders. Whenever by any
-----------------------------------------
provision of statute or of the Certificate of Incorporation or of these
By-Laws, the vote of stockholders at a meeting thereof is required or
permitted to be taken in connection with any corporate action, the meeting and
vote of
-3-
<PAGE>
stockholders may be dispensed with if all the stockholders who would have been
entitled to vote upon the action if such meeting were held shall consent in
writing to such corporate action being taken.
3. BOARD OF DIRECTORS.
------------------
3.1 Number, Qualification, Election and Term of Directors.
------------------------------------------------------
The business of the Corporation shall be managed by the Board, which shall
consist of at least three (3) and not more than ten (10) directors, each of whom
shall each be at least 21 years old; provided, however, at such time or times as
all of the shares of the Corporation are owned beneficially and of record by
less than three stockholders, the Board of Directors by vote of a majority of
the entire Board or the stockholders may fix the number of directors
constituting the entire Board at less than three but not less than the number of
stockholders. The exact number of directors shall be determined by resolution
of a majority of the entire Board or by the stockholders, but no decrease may
shorten the term of any incumbent director. Directors need not be stockholders.
Directors shall be elected at each annual meeting of stockholders by a plurality
of the votes cast and shall hold office until the next annual meeting of
stockholders and until their successors are elected and qualify. (The provision
was amended by shareholders on February 26, 1987)
-4-
<PAGE>
3.2 Quorum and Manner of Acting. A majority of the entire Board
---------------------------
shall constitute a quorum for the transaction of business at any meeting, except
as provided in Section 3.8 of these By-Laws. Action of the Board shall be
authorized by the vote of a majority of the directors present at the time of the
vote if there is a quorum, unless otherwise provided by law or these By-Laws.
In the absence of a quorum, a majority of the directors present may adjourn any
meeting from time to time until a quorum is present.
3.3 Place of Meetings. Meetings of the Board may be held in or
-----------------
outside New York State.
3.4 Annual and Regular Meetings. Annual meetings of the Board, for
---------------------------
the election of officers and consideration of other matters, shall be held
either (a) without notice immediately after the annual meeting of stockholders
and at the same place, or (b) as soon as practicable after the annual meeting of
stockholders, on notice as provided in Section 3.6 of these By-Laws. Regular
meetings of the Board may be held without notice at such times and places as the
Board determines. If the day fixed for a regular meeting is a legal holiday,
the meeting shall be held on the next business day.
3.5 Special Meetings. Special meetings of the Board may be called
----------------
by the Chairman of the Board, the President or by any two of the directors,
provided, if there should be only one director, then upon the call of such
director.
-5-
<PAGE>
3.6 Notice of Meetings; Waiver of Notice. Notice of the time and
------------------------------------
place of each special meeting of the Board, and of each annual meeting not held
immediately after the annual meeting of stockholders and at the same place,
shall be given to each director by depositing it in a post office or post box in
a sealed postpaid wrapper, addressed to him at his residence or usual place of
business, at least three days before the meeting, or by delivering or
telephoning or telegraphing it to him at least two days before the meeting.
Notice need not be given to any director who submits a signed waiver of notice
before or after the meeting, or who attends the meeting without protesting the
lack of notice to him, either before the meeting or when it begins. Notice of
any adjourned meeting need not be given, other than by announcement at the
meeting at which the adjournment is taken.
3.7 Resignation and Removal of Directors. Any director may resign
------------------------------------
at any time. Except where the Certificate of Incorporation contains provisions
authorizing cumulative voting or the election of one or more directors by class
or their election by holders of bonds, or requires all action by stockholders to
be by a greater vote, any one or more of the directors may be removed (a) either
for or without cause, at any time, by vote of the stockholders holding a
majority of the outstanding stock or the Corporation entitled to vote, present
in person or by proxy, at any special meeting of the stockholders,
-6-
<PAGE>
or (b) for cause, by action of the Board at any regular or special meeting of
the Board. A vacancy or vacancies occurring from such removal may be filled at
the special meeting of stockholders or at a regular or special meeting of the
Board. (This provision was amended by shareholders on February 26, 1987)
3.8 Vacancies. Except as otherwise provided in the Certificate of
---------
Incorporation or in Section 3,7 of these By-Laws, any vacancy in the Board, from
whatever cause arising, including vacancies occurring by reason of the removal
of directors without cause and newly created by an increase in the number of
directors, may be filled for the unexpired term by a majority vote of the
remaining directors, though less than a quorum, or such vacancies may be filled
by the shareholders. (This provision was amended by shareholders on February
26, 1987)
3.9 Compensation. Directors shall receive such compensation as the
------------
Board determines, together with reimbursement of their reasonable expenses in
connection with the performance of their duties. A director may also be paid
for serving the Corporation, its affiliates or subsidiaries in other capacities.
3.10 Executive Committee. Whenever the total number of directors
-------------------
shall exceed three, the Board, by resolution adopted by a majority of the entire
Board, may designate an Executive Committee of two or more directors which shall
have all the authority of the Board, except as otherwise provided in the
resolution or by-law, and which shall serve at the pleasure of
-7-
<PAGE>
the Board. All action of the Executive Committee shall be reported to the Board
at its next meeting. The Executive Committee shall adopt rules of procedure and
shall meet as provided by those rules or by resolutions of the Board.
3.11 Other Committees. The Board, by resolution adopted by a
----------------
majority of the entire Board, may designate other committees of directors, to
serve at the Board's pleasure, with such powers and duties as the Board
determines.
3.12 Written Consent in Lieu of Meeting. Any action required or
----------------------------------
permitted to be taken by the Board or any Committee thereof may be taken without
a meeting if all members of the Board or the Committee consent in writing to the
adoption of a resolution authorizing the action. The resolution and the written
consents thereto by the members of the Board or Committee shall be filed with
the minutes of the proceedings of the Board or Committee.
3.13 Participation at Meeting. Unless otherwise restricted by the
------------------------
Certificate of Incorporation or these By-Laws, members of the Board, or any
Committee designated by the Board, may participate in a meeting of the Board, or
any Committee, by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other, and such participation in a meeting shall constitute presence in
person at the meeting.
-8-
<PAGE>
4. OFFICERS.
--------
4.1 Executive Officers. The executive officers of the Corporation
------------------
shall be the President, Secretary and a Treasurer. In addition, the Board may
elect a Chairman of the Board, one or more Vice Presidents, and such other
officers with such powers and duties as it may deem necessary. Any two or more
offices may be held by the same person, except for the offices of President and
Secretary. Provided, however, when all of the issued and outstanding stock of
the Corporation is owned by one person, such person may hold all or any
combination of offices. The Board may require any officer, agent or employee to
give security for the faithful performance of his duties.
4.2 Election; Term of Office. Except as otherwise provided in the
------------------------
Certificate of Incorporation, the executive officers of the Corporation shall be
elected annually by the Board and each such officer shall hold office until the
next annual meeting of the Board and until the election of his successor.
4.3 Subordinate Officers. Except as otherwise provided in the
--------------------
Certificate of Incorporation, the Board may appoint subordinate officers
(including Assistant Secretaries and Assistant Treasurers), agents or employees,
each of whom shall hold office for such period and have such powers and duties
as the Board determines. The Board may delegate to any executive officer or to
any committee the power to appoint and define the
-9-
<PAGE>
powers and duties of any subordinate officers, agents or employees.
4.4 Resignation and Removal of Officers. Any officer may resign at
-----------------------------------
any time. Any officer elected or appointed by the Board or appointed by an
executive officer or by a committee may be removed by a majority (unless the
Certificate of Incorporation requires a larger vote) of the Board, either with
or without cause, at a special meeting called for the purpose.
4.5 Vacancies. A vacancy in any office may be filled for the
---------
unexpired term in the manner prescribed in Sections 4.2 and 4.3 of these By-Laws
for election or appointment to the office.
4.6 Chairman of the Board. The Chairman of the Board shall preside
---------------------
at all meetings of the Board and of the stockholders and shall have such powers
and duties as the Board assigns to him.
4.7 The President. Subject to the control of the Board, the
-------------
President shall have general supervision over the business of the Corporation
and shall have such other powers and duties as presidents of corporations
usually have in the general management and control of the business and affairs
of the Corporation, or as the Board assigns to him.
4.8 The Vice President. The Vice President, or if there be more than
------------------
one, the senior Vice President, or it there be more than one, the senior Vice
President, as determined by the Board, in the absence or disability of the
President,
-10-
<PAGE>
shall exercise the powers and perform the duties of the President, and each Vice
President shall exercise such other powers and perform such other duties as
shall be prescribed by the Board or the President.
4.9 The Treasurer. The Treasurer shall be in charge of the
-------------
Corporation's books and accounts. Subject to the control of the Board, he shall
have such other powers and duties as the Board or the President assigns to him.
4.10 The Secretary. The Secretary shall be the Secretary of, and
-------------
keep the minutes of, all meetings of the Board and of the stockholders, shall be
responsible for giving notice of all meetings of stockholders and of the Board,
shall keep the seal and, when authorized by the Board, shall apply it to any
instrument requiring it. Subject to the control of the Board, he shall have
such other powers and duties as the Board or the President assigns to him. In
the absence of the Secretary from any meeting, the minutes shall be kept by the
person appointed for that purpose by the presiding officer.
4.11 Salaries. The salaries of all officers shall be fixed by the
--------
Board, and the fact that any officer is a director shall not preclude him from
receiving a salary as an officer, or from voting upon the resolution providing
the same.
-11-
<PAGE>
5. SHARES.
------
5.1 Certificates. The shares of the Corporation shall be represented
------------
by certificates in the form approved by the Board. Each certificate shall be
signed by the Chairman of the Board or the President or a Vice President and by
the Secretary or an Assistant Secretary or the Treasurer or an Assistant
Treasurer, and shall be sealed with the Corporation's seal or a facsimile
thereof. The signatures of the officers upon a certificate may be facsimiles if
the certificate is countersigned by a transfer agent or registered by a
registrar other than the Corporation itself or its employees.
5.2 Transfers. Shares shall be transferable only on the
---------
Corporation's books upon surrender of the certificate for the shares, properly
endorsed. The Board may require satisfactory surety before issuing a new
certificate to replace a certificate claimed to have been lost or destroyed.
5.3 Determination of Stockholders of Record. The Board may fix, in
---------------------------------------
advance, a date as the record date for the determination of stockholders
entitled to notice of or to vote at any meeting of the stockholders, or to
express consent to or dissent from any proposal without a meeting, or to receive
payment or any dividend or the allotment of any rights, or for the purpose of
any other action. The record date may not be more than 50 nor less than 10 days
before the date of the meeting, nor more than 50 days before any other action.
-12-
<PAGE>
6. MISCELLANEOUS.
-------------
6.1 Seal. The Board shall adopt a corporate seal, which shall be in
----
the form of a circle and shall bear the Corporation's name and the year and
state in which it was incorporated.
6.2 Fiscal Year. The fiscal year of the Corporation shall be from
-----------
October 1st through September 30th.
6.3 Voting of Shares in Other Corporations. Shares in other
--------------------------------------
corporations which are held by the Corporation may be represented and voted by
the President or Vice President of this Corporation or by proxy or proxies
appointed by one of them. The Board may, however, appoint some other person to
vote the shares.
6.4 Checks, Notes, Etc.. Checks, notes, drafts, bills of exchange
-------------------
and orders for the payment of money shall be signed or endorsed in such manner
as shall be determined by the Board. The funds of the Corporation shall be
deposited in such bank or trust company, and checks drawn against such funds
shall be signed in such manner as may be determined from time to time by the
board.
6.5 Dividends. The Board may declare dividends from time to time
---------
upon the capital stock of the Corporation from any funds legally available
therefor at any regular or special meeting.
13
<PAGE>
6.6 Amendments. These By-Laws may be adopted, altered, amended, or
----------
repealed by the stockholders or by a majority of the entire Board, but any By-
Law adopted by the Board may be amended or repealed by the stockholders. If a
By-Law regulating elections or directors is adopted, altered, amended or
repealed by the Board, the notice of the next meeting of stockholders shall set
forth the By-Law so adopted, altered, amended or repealed, together with concise
statement of the changes made. (This provision was amended by shareholders on
February 26, 1987.)
14
<PAGE>
July 31, 1985 Amendment
2.1 Annual Meeting. The Annual Meeting of Shareholders shall be held
--------------
each year in February on such date as is determined by the Board of Directors.
15
<PAGE>
February 26, 1987 Amendment
2.5 Quorum. The presence in person or by proxy of the holders of
------
one-third of the shares entitled to vote shall constitute a quorum for the
transaction of any business. In the absence of a quorum, a majority in voting
interest of those present in person or by proxy and entitled to vote, or, in the
absence of all the stockholders, any officer entitled to preside at or to act as
Secretary of the meeting, may adjourn the meeting until a quorum is present. At
any adjourned meeting at which a quorum is present any action may be taken which
might have been taken at the meeting as originally called.
16
<PAGE>
February 26, 1987 Amendment
3.1 Number, Qualification, Election and Term of Directors. The
-----------------------------------------------------
business of the Corporation shall be managed by or under the direction of the
Board, which shall have and may exercise all of the powers of the Corporation,
except such as are expressly conferred upon the stockholders by law, by the
Certificate of Incorporation, or by these By-Laws. The Board shall consist of
not fewer than six (6) nor more than ten (10) directors, each of whom shall each
be at least 21 years old; provided, however, at such time or times as all of the
shares of the Corporation are owned beneficially and of record by fewer than
three stockholders, the Board of Directors by vote of a majority of the entire
Board or the stockholders may fix the number of directors constituting the
entire Board at less than three but not less than the number of stockholders.
The exact number of directors shall be determined by resolution of a majority of
the entire Board (whether or not there exist any vacancies in previously
authorized directorships at the time such resolution is presented to the Board
for adoption), but no decrease may shorten the term of any incumbent director.
Directors need not be stockholders. At the 1987 Annual Meeting of Stockholders,
the directors shall be divided into two classes, as nearly equal in number as
possible (but with not fewer than three directors in each class), with the term
of the first class
<PAGE>
to expire at the 1988 Annual Meeting of Stockholders, and the term of the second
class to expire at the 1989 Annual Meeting of Stockholders, and with the members
of each class to hold office until their successors have been elected and
qualified. Directors shall be elected by a plurality of the votes cast. At
each annual meting of stockholders following such initial classification and
election, if at such time the number of directors is less than nine, directors
elected to succeed those directors whose terms expire shall be elected for a
term and shall hold office until the second succeeding annual meeting of
stockholders and until their successors are elected and qualified. If after the
1987 Annual Meeting of Stockholders the number of directors shall be increased
to nine or more, at the next succeeding annual meeting of stockholders after
such increase, the directors shall be divided into three classes, as nearly
equal in size as possible. At such annual meeting of stockholders, one class
shall be elected for a term of office expiring at the next annual meting of
stockholders, the second class shall be elected for a term of office expiring
at the second succeeding annual meeting of stockholders, and the third class
shall be elected for a term of office expiring at the third succeeding annual
meeting of stockholders. At each annual meeting following that at which the
board is initially classified and elected in three classes, directors elected
to succeed those directors whose terms expire shall be elected for a term of
-2-
<PAGE>
office expiring at the third succeeding annual meeting of stockholders after
their election, and until their successors shall be elected and qualified.
-3-
<PAGE>
February 26, 1987 Amendment
3.7 Resignation and Removal of Directors. Any director may resign at
------------------------------------
any time. Any one or more of the directors may be removed only for cause (a) by
affirmative vote of the stockholders holding (i) at least 66-2/3% of the
outstanding stock of the Corporation entitled to vote for the election of
directors and (ii) a majority of such shares other than shares held by a person
whose beneficial interest, directly or indirectly, first equals an aggregate of
20% or more of such shares after the date this Section 3.7 was adopted (such
person is hereinafter referred to as an "Interested Shareholder") present in
person or by proxy, at any special meting of the stockholders, or (b) by action
of the Board at any regular or special meeting of the Board. A vacancy or
vacancies arising from such removal may be filled at the special meeting of
stockholders only by the vote required by subdivision (a) hereof, or at a
regular or special meeting of the Board.
<PAGE>
February 26, 1987 Amendment
3.8 Vacancies. Except as otherwise provided in the Certificate of
---------
Incorporation or in Section 3.7 of these By-Laws, any vacancy in the Board,
from whatever cause arising, may be filled until the next annual meeting of
stockholders by a majority vote of the remaining directors, though less than a
quorum, or by a sole remaining director, or such vacancies may be filled by the
affirmative vote of stockholders require in Section 3.7 hereof.
<PAGE>
February 26, 1987 Amendment
6.6 Amendment or Repeal. These By-Laws may be adopted, altered,
-------------------
amended, or repealed by the stockholders or by a majority of the entire Board,
by any By-Law adopted by the Board may be amended or repealed by the
stockholders. If a By-Law regulating elections of directors is adopted,
altered, amended or repealed by the Board, the notice of the next meeting of
stockholders shall set forth the By-Law so adopted, altered, amended or
repealed, together with concise statement of the changes made. Notwithstanding
the foregoing or any other provision in these By-Laws to the contrary, Sections
3.1 ("Number, Qualification, Election and Term of Directors"), 3.2 ("Quorum and
Manner of Acting"), 3.7 ("Resignation an Removal of Directors") or 3.8
("Vacancies") of Article 3 ("Directors") or this Section 6.6 may be amended,
supplemented or repealed only by the affirmative vote of (i) at least 66-2/3% of
the outstanding stock of the Corporation entitled to vote for election of
directors and (ii) a majority of such shares other than shares held by
Interested Shareholders.
<PAGE>
February 26, 1987 Amendment
ARTICLE SEVEN
INDEMNIFICATION OF OFFICERS AND DIRECTORS
Section 7.1 General. The Corporation shall, to the fullest extent
-------
permitted by the New York Business Corporation Law as the same exists or,
subject to Section 7.4 of this Article Seven, may hereafter be amended,
indemnify any director or officer of the Corporation or subsidiary hereof who is
or was made or threatened to be made a party to or is involved in any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, including any action by or in the
right of any other corporation of any type or kind, domestic or foreign, or any
partnership, joint venture, trust, employee benefit plan or other enterprise,
which any director or officer of the Corporation or subsidiary is serving, has
served or has agreed to serve in any capacity at the request of the corporation
or subsidiary, by reason of the fact that he, his testator or intestate, is or
was or had agreed to become a director or officer of the Corporation or
subsidiary, or is or was serving or has agreed to serve such other corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise in
any capacity, against judgments, fines, amounts paid or to be paid in
settlement, excise taxes or penalties, and costs, charges and expenses,
including attorneys' fees, incurred in connection with such action or proceeding
or any appeal therein; provided, however, that no indemnification shall be
provided to any such person if a judgment or other final adjudication adverse to
the director or officer establishes that (i) his acts were committed in bad
faith or were the result of active and deliberate dishonesty and, in either
case, were material to the cause of action so adjudicated, or (ii) he personally
gained in fact a financial profit or other advantage to which he was not legally
entitled; provided, however, that, except as provided in Section 7.6 of this
Article Seven or as otherwise provided by agreement, the Corporation shall
indemnify any such person seeking indemnification in connection with a
proceeding (or part thereof) initiated by such person only if such proceeding
(or part thereof) was authorized by the Board. This Article shall apply only to
those officers who have been appointed pursuant to resolution of the Board of
the Corporation or subsidiary, or whose appointment was ratified thereby.
Section 7.2 Non-Exclusivity of Rights. The Corporation may indemnify
-------------------------
any person to whom the Corporation is permitted to provide indemnification or
the advancement of expenses by
<PAGE>
applicable law, whether pursuant to rights granted pursuant to, or provided by,
the New York Business Corporation Law or other rights created by (i) a
resolution of stockholders, (ii) a resolution of directors or (iii) an agreement
providing for such indemnification, it being expressly intended that these By-
Laws authorize the creation of other rights in any such manner. The right to be
indemnified and to the reimbursement or advancement of expenses incurred in
defending a proceeding in advance of its final disposition conferred in this
Section shall not be exclusive of any other right which any person may have or
hereafter acquire under any statute, provision of the Charter, By-Laws,
agreement, vote of stockholders or disinterested directors or otherwise.
Section 7.3 Expenses. The Corporation shall, from time to time,
--------
reimburse or advance to any person referred to in Section 7.1 of this Article
Seven the funds necessary for payment of expenses, including attorneys' fees,
incurred in connection with any action or proceeding referred to in Section 7.1,
upon receipt of a written undertaking by or on behalf of such person to repay
such amount(s) if a judgment or other final adjudication adverse to the director
or officer establishes that (i) his acts were committed in bad faith or were the
result of active and deliberate dishonesty and, in either case, were material to
the cause of action so adjudicated, or (ii) he personally gained in fact a
financial profit or other advantage to which he was not legally entitled.
Section 7.4 Interpretation of Rights to Indemnification. Any person
-------------------------------------------
entitled to be indemnified or to the reimbursement or advancement of expenses as
a matter of right pursuant to this Section may elect to have the right to
indemnification (or advancement of expenses) interpreted on the basis of the
applicable law in effect at the time of the occurrence of the event or event
giving rise to the action or proceeding, to the extent permitted by law, or on
the basis of the applicable law in effect at the time indemnification is sought.
Section 7.5 Other Rights. The right to be indemnified or to the
------------
reimbursement or advancement of expenses pursuant to this Article Seven (i) is a
contract right pursuant to which the person entitled thereto may bring suit as
if the provisions hereof were set forth in a separate written contract between
the Corporation and the director or officer, (ii) is intended to be retroactive
and shall be available with respect to event(s) occurring prior to the adoption
hereof and (iii) shall continue to exist after the rescission or restrictive
modification hereof with respect to events occurring prior thereto.
Section 7.6 Right of Claimant to Bring Suit. If a request to be
-------------------------------
indemnified is made under this Article Seven, the Board shall make a
determination pursuant to Section 723(b) of the New York Business Corporation
Law within 30 days after such request as to whether the person so requesting
indemnification is
-2-
<PAGE>
entitled to indemnification under this Article Seven and the New York Business
Corporation Law. If a request to be indemnified or for the reimbursement or
advancement of expenses under this Article Seven is not paid in full by the
Corporation within thirty days after a written claim has been received by the
Corporation, the claimant may at any time thereafter bring suit against the
Corporation to recover the unpaid amount of the claim and, if successful in
whole or in part, the claimant shall be entitled to be paid also the expense of
prosecuting such claim. It shall be a defense to any such action (other than an
action brought to enforce a claim for expenses incurred in defending any
proceeding in advance of its final disposition where the require undertaking, if
any is required, has been tendered to the Corporation) that the claimant has not
met the standards of conduct which make it permissible under the New York
Business Corporation Law or hereunder for the Corporation top indemnify the
claimant for the amount claimed, but the burden of proving such defense shall be
on the Corporation. Neither the failure of the Corporation (including its
Board, independent legal counsel or its stockholders) to have made a
determination prior to the commencement of such action that indemnification of
the claimant is proper in the circumstances because he has met the applicable
standard of conduct set forth in the New York Business Corporation Law or
hereunder, nor an actual determination by the Corporation (including its Board,
independent legal counsel or its stockholder) that the claimant has not met such
applicable standard of conduct, shall be a defense to the action or create a
presumption that the claimant has not met the applicable standard of conduct.
Section 7.7 Insurance. The Corporation may maintain insurance, at
---------
its expense, to protect itself and any director, officer, employee or agent of
the Corporation or another corporation, partnership, joint venture, trust or
other enterprise against any such expense, liability or loss, whether or not the
Corporation would have the power to indemnify such person against such expense,
liability or loss under the New York Business Corporation Law.
Section 7.8 Separability. If this Article Seven or any portion
------------
hereof shall be invalidated on any ground by any court of competent
jurisdiction, the Corporation shall nevertheless indemnify each director,
officer, employee or agent of the Corporation as to costs, charges and expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
with respect to any action, suit or proceeding, whether civil, criminal,
administrative or investigative, including any action by or in the right of the
Corporation, to the fullest extent permitted by any applicable portion of this
Article Seven that shall not have been invalidated and to the fullest extent
permitted by applicable law.
-3-
Exhibit 5
EXHIBIT 5
---------
735-8600
November 8, 1995
Zing Technologies, Inc.
115 Stevens Avenue
Valhalla, New York 10595
Re: Zing Technologies, Inc.
Registration Statement on Form SB-2
Gentlemen:
In our capacity as counsel to Zing Technologies, Inc., a Delaware
corporation (the "Company"), we have been asked to render this opinion in
connection with a registration statement on Form SB-2 (the "Registration
Statement") being filed by the Company with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, covering an aggregate
of up to 199,318 shares (the "Shares") of common stock of the Company, $0.01 par
value per share (the "Common Stock"), issued or to be issued upon the exercise
of certain warrants (the "Warrants").
In furnishing our opinion, we have examined the Certificate of
Incorporation, as amended, and the By-Laws, as amended, of the Company, and such
other instruments and documents as we have deemed relevant and necessary as the
basis for our opinion expressed herein. We have examined originals or
certified, conformed, or photostatic copies of all documents, the authenticity
of which has been established to our satisfaction. In all such examinations, we
have assumed the genuineness of all signatures on original and certified
documents, and the conformity to executed documents of all executed copies
submitted to us as conformed or photostatic copies.
<PAGE>
Zing Technologies, Inc.
November ___, 1995
Page 2
Based upon and subject to the foregoing, we are of the opinion that
the Shares have been duly authorized and, when paid for and issued in accordance
with the terms of the Warrants, will be duly and validly issued shares of Common
Stock.
We hereby consent to the use of this opinion as an exhibit to the
Registration Statement, and to the use of our name in the Prospectus under the
caption "Legal Matters".
Very truly yours,
/s/ Morrison Cohen Singer & Weinstein, LLP
EXHIBIT 21
----------
SUBSIDIARIES OF REGISTRANT
--------------------------
1. Omnirel Corporation, incorporated under the laws of the State
of Massachusetts, doing business under the name "Omnirel
Corporation"
2. Transition Analysis Component Technology, Inc., incorporated
under the laws of the State of Delaware, doing business under
the names "Transition Analysis Component Technology, Inc."
and "TACTech"
EXHIBIT 23.1
------------
We consent to the reference to our firm under the caption "Experts" in
the Registration Statement (Form SB-2 No. 33-00000) and related Prospectus of
Zing Technologies, Inc. for the registration of 199,318 shares of its common
stock and to the Incorporation by reference therein of our report dated
September 12, 1995, with respect to the financial statements and schedules of
Zing Technologies, Inc. included in its Annual Report on Form 10-K for the year
ended June 30, 1995, filed with the Securities and Exchange Commission.
/s/ ERNST & YOUNG LLP
White Plains, New York
November 6, 1995