SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10 - QSB
(x) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2002
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OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 0-33135
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ZENITH TECHNOLOGY, INC.
-----------------------
(exact name of small business issuer as specified in its charter)
Nevada 68-0448219
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
409 Center Street, Yuba City, CA 95991
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(Address of principal executive offices) (Zip Code)
Issuer's telephone number (530) 790-0246
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Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes X No
--- ---
As of September 30, 2002, 28,693,683 shares of Common Stock, $.0001 par value,
were outstanding.
INDEX
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Page
Number
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PART I. FINANCIAL INFORMATION
Item 1. Financial Statements:
Balance Sheet
as of September 30, 2002 3
Statements of Operations for the
Three and Nine Months ended September 30, 2002 and 2001 4
Statements of Cash Flows for the
Nine Months ended September 31, 2002 and 2001 5
Notes to Financial Statements 6
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations 7
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 12
Item 2. Changes in Securities and use of proceeds 12
Item 3. Defaults upon Senior Securities 12
Item 4. Submission of Matters to Vote of Security Holders 12
Item 5. Other Information 12
Item 6. Exhibits and Reports on Form 8-K 12
Signatures 13
Certifications 14
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
---------------------
Balance Sheet
Zenith Technology, Inc.
ASSETS 30-Sep-02
(unaudited)
Current Assets
Cash and cash equivalents $ --
Accounts receivable, net --
--------
Total Current Assets --
--------
TOTAL ASSETS $ --
========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities
Accounts Payable
--------
Total Current Liabilities --
Due to Prime Companies, Inc. 11,000
Stockholders' Equity
Common Stock, $.0001 par value, 100,000,000 authorized
28,693,683 issued and outstanding 2,869
Additional paid-in capital 47,131
Accumulated Deficit (61,000)
--------
Total Stockholders' Deficit (11,000)
--------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ --
========
The accompanying notes are an integral part of these financial statements.
-3-
Statements of Operations
Zenith Technology, Inc.
Three months Three months Nine months Nine months
ended ended ended ended
30-Sep-02 30-Sep-01 30-Sep-02 30-Sep-01
------------ ---------- ------------ ------------
(unaudited) (unaudited) (unaudited) (unaudited)
Sales revenues $ -- $ 85 $ 80 $ 85
Cost of sales 122 71 163 71
------------ ---------- ------------ ------------
Gross profit (122) 14 (83) 14
Selling, general & administrative expenses -- 4,943 (58) 4,943
------------ ---------- ------------ ------------
Income from operations (122) (4,929) (25) (4,929)
Interest income -- -- -- --
Interest expense -- -- -- --
------------ ---------- ------------ ------------
Income before taxes and extraordinary item (122) (4,929) (25) (4,929)
------------ ---------- ------------ ------------
Income taxes -- -- -- --
------------ ---------- ------------ ------------
Net income $ (122) $ (4,929) $ (25) $ (4,929)
============ ========== ============ ============
Basic & diluted per share information:
Net Loss $ (0.00) $ (0.00) $ (0.00) $ (0.00)
============ ========== ============ ============
Weighted Average Shares, basic and diluted 28,693,683 28,693,683 28,693,683 28,693,683
============ ========== ============ ============
The accompanying notes are an integral part of these financial statements.
-4-
Statements of Cash Flows
Zenith Technology, Inc.
Nine months Nine months
ended ended
30-Sep-02 30-Sep-01
--------- ---------
(unaudited) (unaudited)
Cash Flows from Operating Activities
Net income $ (25) $ (4,929)
Change in Accounts Receivable 83 (14)
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Net Cash provided by operating activities 58 (4,943)
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Cash Flows from Investing Activities
Purchases of Property and Equipment -- --
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Net Cash used in investing activities -- --
--------- ---------
Cash Flows from Financing Activities
Advances from (Repayments to) Parent Company (58) 4,943
--------- ---------
Net Cash provided by (used in) financing activities (58) 4,943
--------- ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS -- --
CASH AND CASH EQUIVALENTS, beginning of period $ -- $ --
--------- ---------
CASH AND CASH EQUIVALENTS, end of period $ -- $ --
========= =========
The accompanying notes are an integral part of these financial statements.
-5-
Zenith Technology, Inc.
Notes to Financial Statements
1. FINANCIAL STATEMENTS
---------------------
The balance sheet as of September 30, 2002, the related statements of operations
for the three and nine months ended September 30, 2002 and 2001, and cash flows
for the nine months ended September 30, 2002 and 2001 have been prepared by the
Company without audit. In the opinion of management, the financial statements
contain all adjustments, consisting of normal recurring accruals, necessary to
present fairly the financial position of Zenith Technology, Inc. as of September
30, 2002, the results of their operations for the three and nine months ended
September 30, 2002 and 2001, and their cash flows for the nine months ended
September 30, 2002 and 2001. The results of operations for the three and nine
months ended September 30, 2002 are not necessarily indicative of the results to
be expected for the entire fiscal year ending December 31, 2002.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. It is suggested that these financial statements
be read in conjunction with the financial statements from inception through June
30, 2001 and the notes thereto included in the Company's Form 10SB12GA filed on
September 10, 2001, and the Company's financial statements for the year ended
December 31, 2001 included in Form 10KSB filed on April 12, 2002.
The company adopted Statement of Financial Standards No. 133, "Accounting for
Derivative Instruments and Hedging Activities" during the fourth quarter of
2001, which did not have an impact on the financial statements as the company
has not used derivative instruments.
2. Subsequent Events
-----------------
None.
-6-
Item 2. Management's Discussion and Analysis of Financial Condition
-----------------------------------------------------------
and Results of Operations
-------------------------
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
- --------------------------------------------------------------------------------
Certain statements made herein or elsewhere by, or on behalf of, the Company
that are not historical facts are intended to be forward-looking statements
within the meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are based on
assumptions about future events and are therefore inherently uncertain.
The Company cautions readers that the following important factors, among others,
could affect the Company's results:
1 Whether acquired businesses perform at pro forma levels used by management
in the valuation process and whether, and the rate at which, management is
able to increase the profitability of acquired businesses.
2. The ability of the Company to manage its growth in terms of implementing
internal controls and information gathering systems, and retaining or
attracting key personnel, among other things.
3. The amount and rate of growth in the Company's corporate general and
administrative expenses.
4. Changes in interest rates, which can increase or decrease the amount the
Company pays on borrowings.
5. Changes in government regulation, including tax rates and structures.
6. Changes in accounting policies and practices adopted voluntarily or
required to be adopted by generally accepted accounting principles.
The Company cautions readers that it assumes no obligation to update or publicly
release any revisions to forward-looking statements made herein or any other
forward-looking statements made by, or on behalf of, the Company.
Background
- ----------
Zenith Technology, Inc. (the "Company" or "Zenith") is a Nevada corporation
organized on December 2, 1998 to engage in the research and commercial
development of a flat plane antenna with applications in the telecommunications
industry. After extensive due diligence it was determined in 1999 that the
commercial development of the proposed antenna technology would not be
commercially viable. In June 2001 the Company became aware of a commercial
opportunity to offer "One Plus" voice long distance service to consumers
throughout the United States as a reseller utilizing the infrastructure of a
Competitive Local Exchange Carrier. The Company entered into a Reseller
Agreement with that carrier in June 2001 and received its first order for
services in July 2001.
On September 24, 2002 Prime Companies, Inc. entered into an Agreement to sell
the controlling interest in the Company to Carnaby.com. It is anticipated
that the transaction will close on or before October 24, 2002; upon closing
of the transaction it is anticipated that the Company will be restructured as
Carnaby, Inc., a holding company of Carnaby.com, an online auction and fixed-
price marketplace poised to compete in the lucrative online auction sector
currently dominated by eBay.
On September 24, 2002 a special meeting of the shareholders was held, at which
the By-Laws were amended to change the authorized number of directors on the
Board of Directors from 2 to 3. At that meeting Mr. Rick Antunes, Chairman of
the Board and Chief Executive Officer of Carnaby.com, based in Casselberry,
Florida, was then elected to the Board of Directors. Prior to founding Carnaby.
com, Mr. Antunes held senior management positions with a number of businesses
during his 26 year business career.
Results of Operations
- -----------------------
During the three month period ended September 30, 2002, total sales revenue
decreased to $0 from $85 for the corresponding period of the prior year. During
the nine month period ended September 30, 2002, total sales revenue decreased
to $80 from $85 for the corresponding period of the prior year. The decrease in
revenue is attributed to a reduction in effort to market 1 + long distance
services.
The gross margin as a percent of revenues was 16% for the three month period
ended September 30, 2001. The gross margin as a percent of revenues was 16% for
the nine month period ended September 30, 2001. There is no comparable figure
for the corresponding periods of the current year.
The Company's selling, general and administrative expenses for the three month
period ended September 30, 2002 was zero compared to $4,943 for the
corresponding period of the prior year. The Company's selling, general and
administrative expenses for the nine month period ended September 30, 2002
was a credit of $58 compared to $4,943 for the corresponding period of the prior
year.
-8-
Interest expense for the three and nine month periods ended September 30, 2002
and 2001 was $-0-.
Interest income for the three and nine month periods ended September 30, 2002
and 2001 was $-0-.
Income taxes for the three and nine month periods ending September 30, 2002 and
2001 was $-0-.
Liquidity and Capital Resources
- ----------------------------------
At September 30, 2002, the Company had cash of $-0- and working capital of $-0-.
Cash provided by operations was $58 for the nine months ended September 30,
2002 compared to cash used in operations of $4,943 for the corresponding period
of the prior year.
Cash used in investing activities for the three months ended September 30, 2002
was $-0- compared to cash used in investing activities of $-0- for the
corresponding period of the prior year.
Funds used in financing activities for the nine months ended September 30, 2002
were $58 compared to funds provided by financing activities of $4,943 for the
corresponding period of the prior year. The funds used in 2002 were a result of
intercompany transactions with our parent company.
-11-
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
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See the Company's annual report on Form 10KSB for the year ended December
31, 2001.
Item 2. Changes in Securities and Use of Proceeds
-----------------------------------------------
None
Item 3. Defaults Upon Senior Securities
----------------------------------
None
Item 4. Submission of Matters to Vote of Security Holders
--------------------------------------------------------
None
Item 5. Other Information
------------------
None
Item 6. Exhibits and Reports on Form 8-K
-------------------------------------
a) Exhibits
99.1) Certifications
1) By-Laws, as amended
-12-
Signatures
- ----------
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
ZENITH TECHNOLOGY, INC.
-----------------------
(Registrant)
Date: October 4, 2002 By: /S/Norbert J. Lima
----------------------
Norbert J. Lima
Chief Executive Officer
Date: October 4, 2002 By: /S/Stephen Goodman
---------------------
Stephen Goodman
Chief Financial Officer
-13-
EXHIBIT 99.1
CERTIFICATIONS OF PRINCIPAL EXECUTIVE OFFICER AND PRINCIPAL FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350
I, Norbert J. Lima, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Zenith Technology,
Inc.;
2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under
which such statements were made, not misleading with respect to the period
covered by this quarterly report; and
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report.
Date: October 4, 2002
/s/ Norbert J. Lima
Norbert J. Lima
Chief Executive Officer
(Principal Executive Officer)
I, Stephen Goodman, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of Zenith Technology,
Inc.;
2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under
which such statements were made, not misleading with respect to the period
covered by this quarterly report; and
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report.
Date: October 4, 2002
/s/ Stephen Goodman
Stephen Goodman
Chief Financial Officer
(Principal Financial Officer)
-14-
BYLAWS
OF
ZENITH TECHNOLOGY, INC.
A Nevada Corporation
ARTICLE I OFFICES
SECTION 1. REGISTERED OFFICE. The registered office of ZENITH TECHNOLOGY, INC.
(the "Corporation") shall be at 1555 E. Flamingo Road, Suite 155, Las Vegas,
Nevada 89119 and the name of the registered agent in charge thereof shall be CHQ
Incorporated. The mailing address of the resident agent shall be 1555 E.
Flamingo Road, Suite 155, Las Vegas, Nevada 89119.
SECTION 2. PRINCIPAL OFFICE. The principal office for the transaction of the
business of the Corporation shall be at such place as the Board of Directors of
the Corporation (the "Board") may determine. The Board is hereby granted full
power and authority to change said principal office from one location to
another.
SECTION 3. OTHER OFFICES. Branch or subordinate offices may be established by
the Board of Directors at such other places as may be desirable.
ARTICLE II SHAREHOLDERS
SECTION 1. PLACE OF MEETING. Meetings of shareholders shall be held either at
the principal executive office of the corporation or at any other location
within or without the State of Nevada which may be designated by written consent
of all persons entitled to vote thereat.
SECTION 2. ANNUAL MEETINGS. The annual meeting of shareholders shall be held on
such day and at such time as may be fixed by the Board; provided, however, that
should said day fall upon a Saturday, Sunday, or legal holiday observed by the
Corporation at its principal executive office, then any such meeting of
shareholders shall be held at the same time and place on the next day thereafter
ensuing which is a full business day. At such meetings, directors shall be
elected by plurality vote and any other proper business may be transacted.
SECTION 3. SPECIAL MEETINGS. Special meetings of the shareholders may be called
for any purpose or purposes permitted under Chapter 78 of Nevada Revised
Statutes at any time by the Board, the Chairman of the Board, the President, or
by the shareholders entitled to cast not less than twenty-five percent (25 %) of
the votes at such meeting. Upon request in writing to the Chairman of the Board,
the President, any Vice-President or the Secretary, by any person or persons
entitled to call a special meeting of shareholders, the Secretary shall cause
notice to be given to the shareholders entitled to vote, that a special meeting
will be held not less than thirty-five (35) nor more than sixty (60) days after
the date of the notice.
1
SECTION 4. NOTICE OF ANNUAL OR SPECIAL MEETING. Written notice of each annual
meeting of shareholders shall be given not less than ten (10) nor more than
sixty (60) days before the date of the meeting to each shareholder entitled to
vote thereat. Such notice shall state the place, date and hour of the meeting
and (i) in the case of a special meeting the general nature of the business to
be transacted, or (ii) in the case of the annual meeting, those matters which
the Board, at the time of the mailing of the notice, intends to present for
action by the shareholders, but, any proper matter may be presented at the
meeting for such action. The notice of any meeting at which directors are to be
elected shall include the names of the nominees intended, at the time of the
notice, to be presented by management for election.
Notice of a shareholders' meeting shall be given either personally or by
mail or, addressed to the shareholder at the address of such shareholder
appearing on the books of the corporation or if no such address appears or is
given, by publication at least once in a newspaper of general circulation in
Clark County, Nevada. An affidavit of mailing of any notice, executed by the
Secretary, shall be prima facie evidence of the giving of the notice.
SECTION 5. QUORUM. A majority of the shares entitled to vote, represented in
person or by proxy, shall constitute a quorum at any meeting of shareholders. If
a quorum is present, the affirmative vote of the majority of shareholders
represented and voting at the meeting on any matter, shall be the act of the
shareholders. The shareholders present at a duly called or held meeting at which
a quorum is present may continue to do business until adjournment,
notwithstanding withdrawal of enough shareholders to leave less than a quorum,
if any action taken (other than adjournment) is approved by at least a majority
of the number of shares required as noted above to constitute a quorum.
Notwithstanding the foregoing, (1) the sale, transfer and other disposition of
substantially all of the corporation's properties and (2) a merger or
consolidation of the corporation shall require the approval by an affirmative
vote of not less than two-thirds (2/3) of the corporation's issued and
outstanding shares.
SECTION 6. ADJOURNED MEETING AND NOTICE THEREOF. Any shareholders meeting,
whether or not a quorum is present, may be adjourned from time to time. In the
absence of a quorum (except as provided in Section 5 of this Article), no other
business may be transacted at such meeting.
It shall not be necessary to give any notice of the time and place of the
adjourned meeting or of the business to be transacted thereat, other than by
announcement at the meeting at which such adjournment is taken; provided,
however when a shareholders meeting is adjourned for more than forty-five (45)
days or, if after adjournment a new record date is fixed for the adjourned
meeting, notice of the adjourned meeting shall be given as in the case of an
original meeting.
SECTION 7. VOTING. The shareholders entitled to notice of nay meeting or to vote
at such meeting shall be only persons in whose name share stand on the stock
records of the corporation on the record date determined in accordance with
Section 8 of this Article.
SECTION 8. RECORD DATE. The Board may fix, in advance, a record date for the
determination of the shareholders entitled to notice of a meeting or to vote or
entitled to receive
2
payment of any dividend or other distribution, or any allotment of rights, or to
exercise rights in respect to any other lawful action. The record date so fixed
shall be not more than sixty (60) nor less than ten (10) days prior to the date
of the meeting nor more than sixty (60) days prior to any other action. When a
record date is so fixed, only shareholders of record on that date are entitled
to notice of and to vote at the meeting or to receive the dividends,
distribution, or allotment of rights, or to exercise of the rights, as the case
may be, notwithstanding any transfer of shares on the books of the corporation
after the record date. A determination of shareholders of record entitled to
notice of or to vote at a meeting of shareholders shall apply to any adjournment
of the meeting unless the Board shall fix a new record date for the meeting. The
Board shall fix a new record date if the meeting is adjourned for more than
forty-five (45) days.
If no record date is fixed by the Board, the record date for determining
shareholders entitled to notice of or to vote at a meeting of shareholders shall
be the close of business on the business day next preceding the day on which
notice is given or, if notice is waived, at the close of business on the
business day next preceding the day on which notice is given. The record date
for determining shareholders for any purpose other than as set in this Section 8
or Section 10 of this Article shall be at the close of the day on which the
Board adopts the resolution relating thereto, or the sixtieth day prior to the
date of such other action, whichever is later.
SECTION 9. CONSENT OF ABSENTEES. The transactions of any meeting of
shareholders, however called and noticed, and wherever held, are as valid as
though had at a meeting duly held after regular call and notice, if a quorum is
present either in person or by proxy, and if, either before or after the
meeting, each of the persons entitled to vote not present in person or by proxy,
signs a written waiver of notice, or a consent to the holding of the meeting or
an approval of the minutes thereof. All such waivers, consents or approvals
shall be filed with the corporate records or made a part of the minutes of the
meeting.
SECTION 10. ACTION WITHOUT MEETING. Any action which, under any provision of
law, may be taken at any annual or special meeting of shareholders, may be taken
without a meeting and without prior notice if a consent in writing, setting
forth the actions to be taken, shall be signed by holders of outstanding shares
having not less than the minimum number of votes that would be necessary to
authorize or take such action at a meeting at which all shares entitled to vote
thereon were present and voted. Unless a record date for voting purposes be
fixed as provided in Section 8 of this Article, the record date for determining
shareholders entitled to give consent pursuant to this Section 10, when no prior
action by the Board has been taken, shall be the day on which the first written
consent is given.
SECTION 11. PROXIES. Every person entitled to vote shares has the right to do so
either in person or by one or more persons authorized by a written proxy
executed by such shareholder and filed with the Secretary not less than five (5)
days prior to the meeting.
SECTION 12. CONDUCT OF MEETING. The President shall preside as Chairman at all
meetings of the shareholders, unless another Chairman is selected. The Chairman
shall conduct each such meeting in a businesslike and fair manner, but shall not
be obligated to follow any technical, formal or parliamentary rules or
principles of procedure. The Chairman's ruling on procedural matters shall be
conclusive and binding on all shareholders, unless at the time of
3
ruling a request for a vote is made by the shareholders entitled to vote and
represented in person or by proxy at the meeting, in which case the decision of
a majority of such shares shall be conclusive and binding on all shareholders
without limiting the generality of the foregoing. the Chairman shall have all
the powers usually vested in the chairman of a meeting of shareholders.
ARTICLE III DIRECTORS
SECTION 1. POWERS. Subject to limitation of the Articles of Incorporation, of
these bylaws, and of actions required to be approved by the shareholders, the
business and affairs of the corporation shall be managed and all corporate
powers shall be exercised by or under the direction of the Board. The Board may,
as permitted by law, delegate the management of the day-today operation of the
business of the corporation to a management company or other persons or officers
of the corporation to a management company or other persons or officers of the
corporation provided that the business affairs of the Corporation shall be
managed and all corporate powers shall be exercised under the ultimate direction
of the Board. Without prejudice to such general powers, it is hereby expressly
declared that the Board shall have the following powers:
(a) To select and remove all of the officers, agents and employees of
the corporation, prescribe the powers and duties for them as may not be
inconsistent with law, or with the Articles of Incorporation or by these bylaws,
fix their compensation, and require from them, if necessary, security for
faithful service.
(b) To conduct, manage, and control the affairs and business of the
corporation and to make such rules and regulations therefore not inconsistent
with law, with the Articles of Incorporation or these bylaws, as they may deem
best.
(c) To adopt, make and use a corporate seal, and to prescribe the forms
of certificates of stock and to alter the form of such seal and such of
certificates from time to time in their judgment they deem best.
(d) To authorize the issuance of shares of stock of the corporation
from time to time, upon such terms and for such consideration as may be lawful.
(e) To borrow money and incur indebtedness for the purposes of the
corporation, and to cause to be executed and delivered therefor, in the
corporate name, promissory notes, bonds, debentures, deeds of trust, mortgages,
pledges, hypothecation or other evidence of debt and securities therefor.
SECTION 2. NUMBER AND QUALIFICATION OF DIRECTORS. The authorized number of
directors shall be three (3) until changed by amendment of the Articles or by a
bylaw duly adopted by approval of the outstanding shares amending this Section
2.
SECTION 3. ELECTION AND TERM OF OFFICE. The directors shall be elected at each
annual meeting of shareholders but if any such annual meeting is not held or the
directors are not elected thereat, the directors may be elected at any special
meeting of shareholders held for that purpose. Each director shall hold office
until the next annual meeting and until a successor has been elected and
qualified.
4
SECTION 4. CHAIRMAN OF THE BOARD. At the regular meeting of the Board, the first
order of business will be to select, from its members, a Chairman of the Board
whose duties will be to preside over all board meetings until the next annual
meeting and until a successor has been chosen.
SECTION 5. VACANCIES. Any director may resign effective upon giving written
notice to the Chairman of the Board, the President, Secretary, or the Board,
unless the notice specified a later time for the effectiveness of such
resignation. If the resignation is effective at a future time, a successor may
be elected to take office when the resignation becomes effective.
Vacancies in the Board including those existing as a result of a removal of a
director, shall be filled by the shareholders at a special meeting, and each
director so elected shall hold office until the next annual meeting and until
such director's successor has been elected and qualified.
A vacancy or vacancies in the Board shall be deemed to exist in case of the
death, resignation or removal of any director or if the authorized number of
directors be increased, or if the shareholders fail, at any annual or special
meeting of shareholders at which any directors are elected, to elect the full
authorized number of directors to be voted for the meeting.
The Board may declare vacant the office of a director who has been declared of
unsound mind or convicted of a felony by an order of court. The shareholders may
elect a director or directors at any time to fill any vacancy or vacancies. Any
such election by written consent requires the consent of a majority of the
outstanding shares entitled to vote. If the Board accepts the resignation of a
director tendered to take effect at a future time, the shareholder shall have
power to elect a successor to take office when the resignation is to become
effective.
No reduction of the authorized number of directors shall have the effect of
removing any director prior to the expiration of the director's term of office.
SECTION 6. PLACE OF MEETING. Any meeting of the Board shall be held at any place
within or without the State of Nevada which has been designated from time to
time by the Board. In the absence of such designation meetings shall be held at
the principal executive office of the corporation.
SECTION 7. REGULAR MEETINGS. Immediately following each annual meeting of
shareholders the Board shall hold a regular meeting for the purpose of
organization, selection of a Chairman of the Board, election of officers, and
the transaction of other business. Call and notice of such regular meeting is
hereby dispensed with.
SECTION 8. SPECIAL MEETINGS. Special meetings of the Board for any purposes may
be called at any time by the Chairman of the Board, the President, or the
Secretary or by any two directors.
Special meetings of the Board shall be held upon at least four (4) days written
notice or forty-eight (48) hours notice given personally or by telephone,
telegraph, telex or other similar means of communication. Any such notice shall
be addressed or delivered to each director at
5
such director's address as it is shown upon the records of the Corporation or as
may have been given to the Corporation by the director for the purposes of
notice.
SECTION 9. QUORUM. A majority of the authorized number of directors constitutes
a quorum of the Board for the transaction of business, except to adjourn as
hereinafter provided. Every act or decision done or made by a majority of the
directors present at a meeting duty held at which a quorum is present shall be
regarded as the act of the Board. unless a greater number be required by law or
by the Articles of Incorporation. A meeting at which a quorum is initially
present may continue to transact business notwithstanding the withdrawal of
directors, if any action taken is approved by at least a majority of the number
of directors required as noted above to constitute a quorum for such meeting.
SECTION 10. PARTICIPATION IN MEETINGS BY CONFERENCE TELEPHONE. Members of the
Board may participate in a meeting through use of conference telephone or
similar communications equipment, so long as all members participate in such
meeting can hear one another.
SECTION 11. WAIVER OF NOTICE. The transactions of any meeting of the Board,
however called and noticed or wherever held, are as valid as though had at a
meeting duty held after regular call and notice if a quorum be present and if,
either before or after the meeting, each of the directors not present signs a
written waiver of notice, a consent to holding such meeting or an approval of
the minutes thereof. Alt such waivers, consents or approvals shall be filed with
the corporate records or made part of the minutes of the meeting.
SECTION 12. ADJOURNMENT. A majority of the directors present, whether or not a
quorum is present, may adjourn any directors' meeting to another time and place.
Notice of the time and place of holding an adjourned meeting need not be given
to absent directors if the time and place be fixed at the meeting adjourned. If
the meeting is adjourned for more than forty-eight (48) hours, notice of any
adjournment to another time or place shall be given prior to the time of the
adjourned meeting to the directors who were not present at the time of
adjournment
SECTION 13. FEES AND COMPENSATION. Directors and members of committees may
receive such compensation, if any, for their services, and such reimbursement
for expenses, as may be fixed or determined by the Board.
SECTION 14. ACTION WITHOUT MEETING. Any action required or permitted to be taken
by the Board may be taken without a meeting if all members of the Board shall
individually or collectively consent in writing to such action. Such consent or
consents shall have the same effect as a unanimous vote of the Board and shall
be filed with the minutes of the proceedings of the Board.
SECTION 15. COMMITTEES. The board may appoint one or more committees, each
consisting of two or more directors, and delegate to such committees any of the
authority of the Board except with respect to:
(a) The approval of any action which requires shareholders' approval or
approval of the outstanding shares;
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(b) The filling of vacancies on the Board or on any committees;
(c) The fixing of compensation of the directors for serving on the Board or
any committee;
(d) The amendment or repeal of bylaws or the adoption of new bylaws;
(e) The amendment or repeal of any resolution of the Board which by its
express terms is not so amendable or repealable by a committee of the board;
(f) A distribution to the shareholders of the corporation:
(g) The appointment of other committees of the Board or the members
thereof. Any such committee must be appointed by resolution adopted by a
majority of the authorized number of directors and may be designated an
Executive Committee or by such other name as the Board shall specify. The Board
shall have the power to prescribe the manner in which proceedings of any such
committee shall be conducted. Unless the Board or such committee shall otherwise
provide, the regular or special meetings and other actions of any such committee
shall be governed by the provisions of this Article applicable to meetings and
actions of the Board. Minutes shall be kept of each meeting of each committee.
ARTICLE IV OFFICERS
SECTION 1. OFFICERS. The officers of the corporation shall be a president, a
secretary and a treasurer. The corporation may also have, at the discretion of
the Board, one or more vice-presidents, one or more assistant vice presidents,
one or more assistant secretaries, one or more assistant treasurers and such
other officers as may be elected or appointed in accordance with the provisions
of Section 3 of this Article.
SECTION 2. ELECTION. The officers of the corporation, except such officers as
may be elected or appointed in accordance with the provisions of Section 3 or
Section 5 of this Article, shall be chosen annually by, and shall serve at the
pleasure of, the Board, and shall hold their respective offices until their
resignation, removal or other disqualification from service, or until their
respective successors shall be elected.
SECTION 3. SUBORDINATE OFFICERS. The Board may elect, and may empower the
President to appoint, such other officers as the business of the corporation may
require, each of whom shall hold office for such period, have such authority,
and perform such duties as are provided in these bylaws or as the Board, or the
President may from time to time direct.
SECTION 4. REMOVAL AND RESIGNATION. Any officer may be removed, either with or
without cause, by the Board of Directors at any time, or, except in the case of
an officer chosen by the Board, by an officer upon whom such power of removal
may be conferred by the Board.
Any officer may resign at any time by giving written notice to the corporation.
Any such resignation shall take effect at the date of the receipt of such notice
or at any later time specified therein. The acceptance of such resignation shall
be necessary to make it effective.
SECTION 5. VACANCIES. A vacancy of any office because of death, resignation,
removal, disqualification, or any other cause shall be filled in the manner
prescribed by these bylaws for the regular election or appointment to such
office.
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SECTION 6. PRESIDENT. The President shall be the chief executive officer and
general manager of the corporation. The President shall preside at all meetings
of the shareholders and, in the absence of the Chairman of the Board at all
meetings of the Board. The president has the general powers and duties of
management usually vested in the chief executive officer and the general manager
of the corporation and such other powers and duties as may be prescribed by the
Board.
SECTION 7. VICE PRESIDENTS. In the absence or disability of the President, the
Vice Presidents in order of their rank as fixed by the Board or, if not ranked,
the Vice President designated by the Board, shall perform all the duties of the
President, and when so acting shall have all the powers of, and be subject to
all the restrictions upon the President. The Vice Presidents shall have such
other powers and perform such other duties as from time to time may be
prescribed for them respectively by the President or the Board.
SECTION 8. SECRETARY. The Secretary shall keep or cause to be kept, at the
principal executive offices and such other place as the Board may order, a book
of minutes of all meetings of shareholders, the Board, and its committees, with
the time and place of holding, whether regular or special, and, if special, how
authorized, the notice thereof given, the names of those present at Board and
committee meetings, the number of shares present or represented at shareholders'
meetings, and proceedings thereof. The Secretary shall keep, or cause to be
kept, a copy of the bylaws of the corporation at the principal executive office
of the corporation.
The Secretary shall keep, or cause to be kept, at the principal executive
office, a share register, or a duplicate share register, showing the names of
the shareholders and their addresses, the number and classes of shares held by
each, the number and date of certificates issued for the same, and the number
and date of cancellation of every certificate surrendered for cancellation.
The Secretary shall give, or cause to be given, notice of all the meetings of
the shareholders and of the Board and any committees thereof required by these
bylaws or by law to be given, shall keep the seal of the corporation in safe
custody, and shaft have such other powers and perform such other duties as may
be prescribed by the Board.
SECTION 9. TREASURER. The Treasurer is the chief financial officer of the
corporation and shall keep and maintain, or cause to be kept and maintained,
adequate and correct accounts of the properties and financial transactions of
the corporation, and shall send or cause to be sent to the shareholders of the
corporation such financial statements and reports as are by law or these bylaws
required to be sent to them.
The Treasurer shall deposit all monies and other valuables in the name and to
the credit of the corporation with such depositories as may be designated by the
Board. The Treasurer shall disburse the funds of the corporation as may be
ordered by the Board, shall render to the President and directors, whenever they
request it, an account of all transactions as Treasurer and of the financial
conditions of the corporation, and shall have such other powers and perform such
other duties as may be prescribed by the Board.
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SECTION 10. AGENTS. The President, any Vice-President, the Secretary or
Treasurer may appoint agents with power and authority, as defined or limited in
their appointment, for and on behalf of the corporation to execute and deliver,
and affix the seal of the corporation thereto, to bonds, undertakings,
recognizance, consents of surety or other written obligations in the nature
thereof and any said officers may remove any such agent and revoke the power and
authority given to him.
ARTICLE V OTHER PROVISIONS
SECTION 1. DIVIDENDS. The Board may from time to time declare, and the
corporation may pay, dividends on its outstanding shares in the manner and on
the terms and conditions provided by law, subject to any contractual
restrictions on which the corporation is then subject.
SECTION 2. INSPECTION OF BY-LAWS. The Corporation shall keep in its Principal
executive Office the original or a copy of these bylaws as amended to date which
shall be open to inspection to shareholders at all reasonable times during
office hours. If the Principal Executive Office of the corporation is outside
the State of Nevada and the Corporation has no principal business office in such
State, it shall upon the written notice of any shareholder furnish to such
shareholder a copy of these bylaws as amended to date.
SECTION 3 . REPRESENTATION OF SHARES OF OTHER CORPORATIONS . The President or
any other officer or officers authorized by the Board or the President are each
authorized to vote, represent, and exercise on behalf of the Corporation all
rights incident to any and all shares of any other corporation or corporations
standing in the name of the Corporation. The authority herein granted may be
exercised either by any such office in person or by any other person authorized
to do so by proxy or power of attorney duly executed by said officer.
ARTICLE VI INDEMNIFICATION
SECTION 1. INDEMNIFICATION IN ACTIONS BY THEIR PARTIES. Subject to the
limitations of law, if any, the corporation shall have the power to indemnity
any director, officer, employee and agent of the corporation who was or is a
party or is threatened to be made a party to any proceeding (other than an
action by or in the right of to procure a judgment in its favor) against
expenses, judgments, fines, settlements and other amounts actually and
reasonably incurred in connection with such proceedings, provided that the Board
shall find that the director, officer, employee or agent acted in good faith and
in a manner which such person reasonably believed in the best interests of the
corporation and, in the case of criminal proceedings, had no reasonable cause to
believe the conduct was unlawful. The termination of any proceeding by judgment,
order, settlement, conviction or upon a plea of nolo contendere shall not, of
itself create a presumption that such person did not act in good faith and in a
manner which the person reasonably believed to be in the best interests of the
corporation or that such person had reasonable cause to believe such person's
conduct was unlawful.
SECTION 2. INDEMNIFICATION IN ACTIONS BY OR ON BEHALF OF THE CORPORATION.
Subject to the limitations of law, if any, the Corporation shall have the power
to indemnify any director, officer, employee and agent of the corporation who
was or is
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threatened to be made a party to any threatened, pending or completed legal
action by or in the right of the Corporation to procure a judgment in its favor,
against expenses actually and reasonable incurred by such person in connection
with the defense or settlement, if the Board of Directors determine that such
person acted in good faith, in a manner such person believed to be in the best
interests of the Corporation and with such care, including reasonable inquiry,
as an ordinarily prudent person would use under similar circumstances.
SECTION 3. ADVANCE OF EXPENSES. Expenses incurred in defending any proceeding
may be advanced by the Corporation prior to the final disposition of such
proceeding upon receipt of an undertaking by or on behalf of the officer,
director, employee or agent to repay such amount unless it shall be determined
ultimately that the officer or director is entitled to be indemnified as
authorized by this Article.
SECTION 4. INSURANCE. The corporation shall have power to purchase and maintain
insurance on behalf of any officer, director, employee or agent of the
Corporation against any liability asserted against or incurred by the officer,
director, employee or agent in such capacity or arising out of such person's
status as such whether or not the corporation would have the power to indemnify
the officer, or director, employee or agent against such liability under the
provisions of this Article.
ARTICLE VII AMENDMENTS
These bylaws may be altered, amended or repealed either by approval of a
majority of the outstanding shares entitled to vote or by the approval of the
Board; provided however that after the issuance of shares, a bylaw specifying or
changing a fixed number of directors or the maximum or minimum number or
changing from a fixed to a flexible Board or vice versa may only be adopted by
the approval by an affirmative vote of not less than two-thirds of the
corporation's issued and outstanding shares entitled to vote.
CERTIFICATE
OF
SECRETARY
THIS IS TO CERTIFY that I am the duly elected, qualified and acting
Secretary of ZENITH TECHNOLOGY, INC. and that the above and foregoing Bylaws,
as amended September 24, 2002 by the shareholders, constituting a true original
copy, were duly adopted as the Bylaws of said corporation on November 2, 1999,
by the Directors of said corporation.
IN WITNESS WHEREOF, I have hereunto set my hand.
Dated: September 24, 2002
By: /s/ Stephen Goodman
Stephen Goodman, Secretary