SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act
of 1934
(Amendment No. ___)
Filed by the Registrant [X] Filed by a Party other than the Registrant [ ] Check
the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for use of the Commission only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material under Rule 14a-12
Zoom Technologies, Inc.
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11. (Set forth the amount on which the
filing fee is calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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ZOOM TECHNOLOGIES, INC.
207 South Street
Boston, MA 02111
May 20, 2005
Dear Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders of
Zoom Technologies, Inc. to be held on Friday, June 24, 2005 at the headquarters
of Zoom Technologies, 207 South Street, Boston, Massachusetts 02111. The
location is near South Station in downtown Boston.
A buffet breakfast will be available starting at 9:15 a.m. Eastern time,
and the meeting will begin at 10:00 a.m. Officers and directors will be
available for discussion before and after the meeting. After the short formal
part of the meeting, there will be a business presentation and a
question-and-answer period.
Whether or not you plan to attend, we urge you to sign and return the
enclosed proxy so that your shares will be represented at the meeting. If you
change your mind about your proxy at the meeting, you can withdraw your proxy
and vote in person.
I look forward to seeing those of you who will be able to attend.
Frank Manning
President
ZOOM TECHNOLOGIES, INC.
207 South Street
Boston, MA 02111
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the "Annual
Meeting") of Zoom Technologies, Inc. will be held on Friday, June 24, 2005 at
10:00 a.m., Eastern time, at Zoom's headquarters located at 207 South Street,
Boston, Massachusetts 02111, for the following purposes:
1. To elect five (5) directors to serve for the ensuing year and until their
successors are duly elected.
2. To consider and act upon a proposal to amend the Zoom Technologies, Inc.
1990 Stock Option Plan to increase the number of authorized shares reserved
for issuance thereunder.
3. To transact any other business that may properly come before the Annual
Meeting or any adjournments thereof.
The Board of Directors has fixed the close of business on April 25, 2005 as
the record date for determining the stockholders entitled to receive notice of
and to vote at the Annual Meeting and any continuation or adjournment thereof.
All stockholders are cordially invited to attend the Annual Meeting.
However, to assure your representation at the Annual Meeting, you are urged to
mark, sign, date and return the enclosed proxy as promptly as possible in the
enclosed postage-prepaid envelope. Any stockholder attending the Annual Meeting
may vote in person even if he or she returned a proxy.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Frank Manning
President
Boston, Massachusetts
May 20,2005
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IMPORTANT: YOU ARE URGED TO SIGN, DATE AND PROMPTLY RETURN THE ACCOMPANYING
PROXY CARD IN THE ENVELOPE PROVIDED, SO THAT IF YOU ARE UNABLE TO ATTEND THE
MEETING YOUR SHARES MAY NEVERTHELESS BE VOTED. EVEN IF YOU HAVE GIVEN YOUR
PROXY, YOUR PROXY MAY BE REVOKED AT ANY TIME PRIOR TO EXERCISE BY FILING WITH
THE SECRETARY OF ZOOM A WRITTEN REVOCATION, BY EXECUTING A PROXY AT A LATER
DATE, OR BY ATTENDING AND VOTING AT THE MEETING.
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THANK YOU FOR ACTING PROMPTLY.
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ZOOM TECHNOLOGIES, INC.
PROXY STATEMENT FOR THE 2005 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 24, 2005
INFORMATION CONCERNING SOLICITATION AND VOTING
General
The enclosed proxy is solicited on behalf of the Board of Directors of Zoom
Technologies, Inc. ("Zoom"), for use at the Annual Meeting of Stockholders to be
held on Friday June 24, 2005 at 10:00 a.m. Eastern time (the "Annual Meeting"),
or at any continuation or adjournment thereof, for the purposes set forth herein
and in the accompanying Notice of Annual Meeting of Stockholders. The Annual
Meeting will be held at the headquarters of Zoom located at 207 South Street,
Boston, Massachusetts 02111. This proxy statement, the accompanying Notice of
the Annual Meeting, proxy card, and Zoom's Annual Report on Form 10-K for the
year ending December 31, 2004 are first being mailed to stockholders on or about
May 20, 2005.
Record Date, Stock Ownership and Voting
Only stockholders of record at the close of business on April 25, 2005 are
entitled to receive notice of and to vote at the Annual Meeting. At the close of
business on April 25, 2005 there were outstanding and entitled to vote 9,067,591
shares of common stock, par value $.01 per share ("Common Stock"). Each
stockholder is entitled to one vote for each share of Common Stock. One-third of
the shares of Common Stock outstanding and entitled to vote is required to be
present or represented by proxy at the Annual Meeting in order to constitute the
quorum necessary to take action at the Annual Meeting.
The five (5) nominees for the Board of Directors who receive the greatest number
of votes cast by stockholders present in person or represented by proxy and
entitled to vote thereon will be elected directors of Zoom. The affirmative vote
of the holders of a majority of shares of Common Stock present in person or
represented by proxy and entitled to vote thereon is required to approve
Proposal No. 2 relating to the amendment to the Zoom Technologies, Inc. 1990
Stock Option Plan, as amended (the "1990 Stock Option Plan").
Votes cast by proxy or in person at the Annual Meeting will be tabulated by
the inspector of elections appointed for the Annual Meeting. The inspector of
elections will treat abstentions as shares of Common Stock that are present and
entitled to vote for purposes of determining a quorum. Abstentions will have no
effect on the outcome of the vote for the election of directors, but will have
the effect of being cast against the proposal to amend the 1990 Stock Option
Plan, even though the stockholder so abstaining may intend a different
interpretation. Shares of Common Stock held of record by brokers who do not
return a signed and dated proxy or do not comply with the voting instructions
will not be considered present at the Annual Meeting, will not be counted
towards a quorum and will not be voted in the election of directors or on the
proposal to amend the 1990 Stock Option Plan. Shares of Common Stock held of
record by brokers who return a signed and dated proxy or comply with the voting
instructions but who fail to vote on the election of directors or the proposal
to amend the 1990 Stock Option Plan will be considered present at the Annual
Meeting and will count toward the quorum but will have no affect on the proposal
not voted.
Revocability of Proxies
Any person giving a proxy in the form accompanying this proxy statement has
the power to revoke it at any time before it is voted. It may be revoked by
filing with the Secretary of Zoom at Zoom's headquarters, 207 South Street,
Boston, Massachusetts 02111, by written notice of revocation or a duly executed
proxy bearing a later date, or by attending the Annual Meeting and voting in
person.
Solicitation
All costs of this solicitation of proxies will be borne by Zoom. Zoom may
reimburse banks, brokerage firms and other persons representing beneficial
owners of shares for their reasonable expenses incurred in forwarding
solicitation materials to such beneficial owners. Solicitation of proxies by
mail may be supplemented by telephone, fax, electronic mail, or personal
solicitations by directors, officers, or employees of Zoom. No additional
compensation will be paid for any such services.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
A board of five (5) directors is to be elected at the Annual Meeting. The
Board of Directors, upon the recommendation of the Nominating Committee, has
nominated the persons listed below for election as directors of Zoom. Unless
otherwise instructed, the proxy holders will vote the proxies received by them
for the nominees named below.
Four of the five nominees are currently directors of Zoom. Mr. L. Lamont
Gordon, a director since 1992, has notified Zoom that he will not stand for
reelection and will resign as a Board of Director and from all Zoom committees,
effective at the Annual Meeting. The Board of Directors has, at the
recommendation of the Nominating Committee, nominated Joseph J. Donovan as the
fifth nominee for Director. If Mr. Donovan is elected, it is expected that he
will be appointed as an independent director to serve on Zoom's Audit,
Compensation and Nomination Committees.
In the event that any nominee cannot or will not serve as a director at the
time of the Annual Meeting, the proxies will be voted for the nominee, if any,
who shall be designated by the present Board of Directors to fill the vacancy.
It is not expected that any nominee will be unable or will decline to serve as a
director. The proposed nominees are not being nominated pursuant to any
arrangement or understanding with any person. Each director elected will hold
office until the next Annual Meeting or until his successor is duly elected or
appointed and qualified, unless his office is earlier vacated in accordance with
the Certificate of Incorporation of Zoom or he becomes disqualified to act as a
director. The five (5) nominees who receive the greatest number of votes cast by
stockholders present, in person or by proxy, and entitled to vote at the Annual
Meeting, will be elected directors of Zoom.
Background of Nominees
Name Age Principal Director
Occupation Since
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Frank B. Manning 56 Chief Executive Officer, 1977
President and Chairman of the
Board of Zoom Technologies, Inc.
Peter R. Kramer 53 Executive Vice President and 1977
Director of Zoom Technologies, Inc.
Bernard Furman (1) 75 Consultant 1991
J. Ronald Woods(1) 69 President of Rowood Capital Corp. 1991
Joseph J. Donovan 55 Director of Education Programs at
Suffolk University's Sawyer School
of Management --
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(1) Current members of the Audit, Nominating and Compensation Committees.
Frank B. Manning is a co-founder of Zoom and has been President, Chief
Executive Officer and a Director of Zoom since May 1977, and Chairman of the
Board since 1986. He earned his B.S., M.S. and Ph.D. degrees in Electrical
Engineering from the Massachusetts Institute of Technology, where he was a
National Science Foundation Fellow. Mr. Manning was a director of Microtouch
Systems, Inc., a Nasdaq-listed leader in touchscreen technology, from 1993 until
its acquisition by 3M in 2001. Since 1998 Mr. Manning has served as a director
of the Massachusetts Technology Development Corporation, a public purpose
venture capital firm that invests in seed and early-stage technology companies
in Massachusetts. Frank B. Manning is the brother of Terry Manning, Vice
President of Sales and Marketing of Zoom.
Peter R. Kramer is a co-founder of Zoom and has been Executive Vice
President and a Director of Zoom since May 1977. He earned his B.A. degree in
1973 from SUNY Stony Brook and his M.F.A. degree from C.W. Post College in 1975.
Bernard Furman has been a Director of Zoom since 1991. Mr. Furman,
currently retired, has served as a consultant to various companies, including
Timeplex, Inc. (formerly listed on the New York Stock Exchange), a world leader
in large capacity multiplexer and network management products. He was a
co-founder of Timeplex and served as its General Counsel and as member of its
Board of Directors from its inception in 1969, and in 1984 also became Vice
Chairman, Chief Administrative Officer and a member of the Executive Committee
of the Board, holding all such positions until Timeplex was acquired by Unisys
Corporation in 1988.
J. Ronald Woods has been a Director of Zoom since 1991. Since November 2000
Mr. Woods has served as President of Rowood Capital Corp., a private investment
Company. From June 1996 to November 2000, Mr. Woods served as Vice
President-Investments of Jascan, Inc., a private investment holding company.
Prior to that, Mr. Woods served as Vice President-Investments of Conwest
Exploration Corporation Ltd., a resource holding company based in Toronto from
1987 to June 1996. He also served as a director, major shareholder and head of
research and corporate finance for Merit Investment Corporation, a stock
brokerage firm, from 1972 through 1987, and served as the President of Merit
Investment Corporation from 1984 through 1987. He is a former Governor of the
Toronto Stock Exchange and is currently a director of Regal Energy Corp., Luke
Energy Ltd., and Virtus Energy Ltd.
Joseph J. Donovan is a new nominee to the Board of Directors. Since March
2004 Mr. Donovan has served as the Director of Education Programs of Suffolk
University's Sawyer School of Management on the Dean College campus, and he is
responsible for the administration of undergraduate and graduate course
offerings at Dean College. Mr. Donovan also serves as an adjunct faculty member
at Suffolk University's Sawyer School of Management. He teaches Money and
Capital Markets, Managerial Economics, and Managerial Finance in the Graduate
School of Business Administration. Mr. Donovan served as the Director of
Emerging Technology Development for the Commonwealth of Massachusetts' Office of
Emerging Technology from January 1993 through October 2004. Mr. Donovan also
served as a director of the Massachusetts Technology Development Corporation,
the Massachusetts Emerging Technology Development Fund, and the Massachusetts
Community Development Corporation. He received a Bachelor of Arts in Economics
and History from St. Anselm College in Manchester, N.H. and a Master's Degree in
Economics and Business from the University of Nebraska.
Board of Directors' Meetings and Committees
The Board of Directors held seven (7) meetings during the year ending
December 31, 2004. Each current director attended at least 75% of the meetings
of the Board of Directors and each Committee on which they served, other than
Mr. Lamont Gordon. All of Zoom's directors are encouraged to attend Zoom's
annual meeting of stockholders. All of Zoom's directors who were serving at the
time were in attendance at Zoom's 2004 Annual Meeting.
Standing committees of the Board include an Audit Committee, a Compensation
Committee and a Nominating Committee. During 2004, Messrs. Furman, Gordon and
Woods served as the members of each of these Committees.
Board Independence. The Board of Directors has reviewed the qualifications
of Messrs. Furman, Gordon and Woods and has determined that each individual is
"independent" as such term is defined under the current listing standards of the
Nasdaq Stock Market. In addition, each member of the Audit Committee is
independent as required under Section 10A(m)(3) of the Securities Exchange Act,
as amended. If elected as a director, it is expected that Mr. Joseph Donovan
will be appointed to serve on the Audit, Compensation and Nomination Committees.
The Board of Directors has reviewed Mr. Donovan's qualifications and has
determined that he would be "independent" under applicable SEC rules and Nasdaq
listing standards.
Audit Committee. Messrs. Furman, Gordon and Woods are currently the members
of the Audit Committee. The Board of Directors has determined that Mr. Woods
qualifies as an "audit committee financial expert", as defined by applicable SEC
rules.
The Audit Committee operates under a written charter adopted by the Board
of Directors, which is publicly available on Zoom's website at www.zoom.com.
Under the provisions of the Audit Committee Charter, the primary functions of
the Audit Committee are to assist the Board of Directors with the oversight of
(i) Zoom's financial reporting process, accounting functions and internal
controls and (ii) the qualifications, independence, appointment, retention,
compensation and performance of Zoom's independent registered public accounting
firm. The Audit Committee is also responsible for the establishment of
"whistle-blowing" procedures, and the oversight of certain other compliance
matters. The Audit Committee held six (6) meetings during 2004. See "Audit
Committee Report" below.
Compensation Committee. Messrs. Furman, Gordon and Woods are currently the
members of Zoom's Compensation Committee. The primary functions of the
Compensation Committee include (i) reviewing and approving Zoom's executive
compensation, (ii) reviewing the recommendations of the Chief Executive Officer
regarding the compensation of senior officers, (iii) evaluating the performance
of the Chief Executive Officer, and (iv) overseeing the administration of, and
the approval of grants of stock options and other equity awarded under Zoom's
stock option plans. A copy of the Compensation Committee's written charter is
publicly available on Zoom's website at www.zoom.com. The Compensation Committee
held one (1) meeting during 2004.
Nominating Committee. Messrs. Furman, Gordon and Woods are currently the
members of Zoom's Nominating Committee. The primary functions of the Nominating
Committee are to (i) identify, review and evaluate candidates to serve as
directors of Zoom, and (ii) make recommendations to the Board of candidates for
all directorships to be filled by the stockholders or the Board.
The Nominating Committee may consider candidates recommended by
stockholders as well as from other sources such as other directors or officers,
third party search firms or other appropriate sources. For all potential
candidates, the Nominating Committee may consider all factors it deems relevant,
such as a candidate's personal integrity and sound judgment, business and
professional skills and experience, independence, possible conflicts of
interest, diversity, the extent to which the candidate would fill a present need
on the Board, and concern for the long-term interests of the stockholders. In
general, persons recommended by stockholders will be considered on the same
basis as candidates from other sources. If a stockholder wishes to recommend a
candidate for director for election at the 2006 Annual Meeting of Stockholders,
it must follow the procedures described in "Deadline for Receipt of Stockholder
Proposals and Recommendations for Director."
A copy of the Nominating Committee's written charter is publicly available
on Zoom's website at www.zoom.com. The Nominating Committee held one (1) meeting
during 2004.
AUDIT COMMITTEE REPORT
The Audit Committee has reviewed and discussed with management Zoom's
audited consolidated financial statements for the year ended December 31, 2004.
The Audit Committee has also discussed with KPMG LLP, Zoom's independent
registered public accounting firm, the matters required to be discussed by the
Auditing Standards Board Statement on Auditing Standards No. 61 (Communications
with Audit Committees), as amended. As required by Independence Standards Board
Standard No. 1, as amended, "Independence Discussion with Audit Committees," the
Audit Committee has received and reviewed the required written disclosures and a
confirming letter from KPMG LLP regarding their independence, and has discussed
the matter with KPMG.
Based on its review and discussions of the foregoing, the Audit Committee
recommended to the Board of Directors that Zoom's audited consolidated financial
statements for 2004 be included in Zoom's Annual Report on Form 10-K for the
year ended December 31, 2004.
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Audit Committee:
Bernard Furman
L. Lamont Gordon
J. Ronald Woods
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Directors' Compensation
Each non-employee director of Zoom receives a fee of $500 per quarter plus
a fee of $500 for each meeting at which the director is personally present.
Travel and lodging expenses are also reimbursed.
Each non-employee director of Zoom is also granted stock options under
Zoom's 1991 Directors Stock Option Plan, as amended (the "Directors Plan").
Currently, the non-employee directors of Zoom are Bernard Furman, L. Lamont
Gordon and J. Ronald Woods.
The Directors Plan provides in the aggregate that 450,000 shares of Common
Stock (subject to adjustment for capital changes) may be issued upon the
exercise of options granted under the Directors Plan. Each non-employee director
automatically receives an option to purchase 12,000 shares of Common Stock on
January 10 and July 10 of each year. The exercise price for the options granted
under the Directors Plan is the fair market value of the Common Stock on the
date the option is granted. During 2004, Messrs. Furman, Woods and Gordon each
received options to purchase 24,000 shares of Common Stock under the Directors
Plan at an average exercise price of $3.81 per share.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding beneficial
ownership of Zoom's Common Stock as of April 8, 2005, by (i) each person who is
known by Zoom to own beneficially more than five percent (5%) of Zoom's Common
Stock, (ii) each of Zoom's directors and nominees for director and each Named
Executive Officer listed below in the Summary Compensation Table under the
heading "Executive Compensation", and (iii) all of Zoom's current directors and
executive officers as a group. On April 8, 2005, there were 9,056,591 issued and
outstanding shares of Zoom's Common Stock. Unless otherwise noted, each person
identified below possesses sole voting and investment power with respect to the
shares listed. The information contained in this table is based upon information
received from or on behalf of the named individuals or from publicly available
information and filings by or on behalf of those persons with the SEC.
Name Number of Shares % of Common Stock
Beneficially Owned
on April 8, 2005
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Frank B. Manning(1) (2) 750,346 8.2%
c/o Zoom Technologies, Inc.
207 South Street
Boston, MA 02111
Peter R. Kramer(3) 625,978 6.8%
c/o Zoom Technologies, Inc.
207 South Street
Boston, MA 02111
Bernard Furman(4) 76,000 *
L. Lamont Gordon(5) 25,000 *
J. Ronald Woods(6) 41,000 *
Joseph J. Donovan *
Robert A. Crist(7) 30,000 *
Deena M. Randall(8) 26,000 *
Terry Manning (2)(9) 128,710 1.4%
All current Directors and 1,718,034 18.1%
Executive Officers as a group
(9 persons)(10)
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*Less than one percent of shares outstanding.
(1) Includes 124,100 shares that Mr. Frank Manning has the right to acquire
upon exercise of outstanding stock options exercisable within sixty (60)
days after April 8, 2005. Includes 3,368 shares held by Mr. Frank Manning's
daughter, as to which he disclaims beneficial ownership.
(2) Terry Manning and Frank B. Manning are brothers.
(3) Includes 120,000 shares that Mr. Kramer has the right to acquire upon
exercise of outstanding stock options exercisable within sixty (60) days
after April 8, 2005.
(4) Includes 36,000 shares the Mr. Furman has the right to acquire upon
exercise of outstanding stock options exercisable within sixty (60) days
after April 8, 2005.
(5) Includes 24,000 shares the Mr. Gordon has the right to acquire upon
exercise of outstanding stock options exercisable within sixty (60) days
after April 8, 2005.
(6) Includes 36,000 shares that Mr. Woods has the right to acquire upon
exercise of outstanding stock options exercisable within sixty (60) days
after April 8, 2005.
(7) Includes 20,000 shares that Mr. Crist has the right to acquire upon
exercise of outstanding stock options exercisable within sixty (60) days
after April 8, 2005.
(8) Includes 26,000 shares that Ms. Randall has the right to acquire upon
exercise of outstanding stock options exercisable within sixty (60) days
after April 8, 2005.
(9) Includes 32,000 shares that Mr. Terry Manning has the right to acquire upon
exercise of outstanding stock options exercisable within sixty (60) days
after April 8, 2005.
(10) Includes an aggregate of 418,100 shares that the current directors and
Named Executive Officers listed above have the right to acquire upon
exercise of outstanding stock options exercisable within sixty (60) days
after April 25, 2005. Also includes an additional 15,000 shares that
executive officers not listed above have the right to acquire upon exercise
of outstanding stock options exercisable within sixty (60) days after April
8, 2005.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following Summary Compensation Table shows, for the years ending
December 31, 2004, 2003 and 2002, the compensation of each person who served as
Chief Executive Officer and the four most highly compensated executive officers
of Zoom whose total annual salary and bonus exceeded $100,000 for all services
rendered in all capacities to Zoom during the last completed year (the "Named
Executive Officers").
Long Term Compensation Awards
-------Annual Compensation------- Securities
Name and Other Annual Underlying All Other
Principal Position Year End Salary Bonus Compensation Options (#) Compensation(2)
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Frank B. Manning, 12/31/04 $129,272 -0- -0- -0- $1,700
Chief Executive Officer, 12/31/03 $129,272 -0- -0- 100,000 $1,700
President and Chairman 12/31/02 $131,758 -0- -0- 100,000 $ 218
of the Board
Peter R. Kramer, 12/31/04 $129,272 -0- -0- -0- $ 909
Executive Vice President 12/31/03 $129,272 -0- -0- 80,000 $ 909
and Director 12/31/02 $131,758 -0- -0- 80,000 $ 218
Robert A. Crist, 12/31/04 $147,264 -0- $4,080(1) -0- $ 770
Vice President of Finance 12/31/03 $147,264 -0- $4,080(1) 40,000 $ 770
and Chief Financial 12/31/02 $150,096 -0- $4,080(1) 40,000 $ 501
Officer
Deena M. Randall, 12/31/04 $128,336 -0- -0- -0- $ 216
Vice President of 12/31/03 $128,336 -0- -0- 40,000 $ 216
Operations 12/31/02 $130,804 -0- -0- 40,000 $ 141
Terry Manning, 12/31/04 $123,500 -0- -0- -0- $ 202
Vice President of 12/31/03 $123,500 -0- -0- 30,000 $ 202
Sales and Marketing 12/31/02 $125,875 -0- -0- 35,000 $ 202
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(1) Consists solely of amounts paid for parking expenses.
(2) Consists of insurance premiums paid by Zoom for the term life insurance
policy for the benefit of the Named Executive Officer.
Option Grants in Last Fiscal Year
There were no options granted to any Named Executive Officer in 2004.
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year End Option
Values
The following table sets forth information with respect to the Named
Executive Officers concerning the exercise of options during the year ended
December 31, 2004 and unexercised options held as of December 31, 2004.
AGGREGATED OPTION EXERCISES IN 2004
AND 12/31/2004 OPTION VALUES
Shares Number of Securities Value of Unexercised
Acquired Value Underlying Unexercised In-the-Money Options
On Realized Options at 12/31/2004 at 12/31/2004 (1)
Name Exercise In 2004 Exercisable Unexercisable Exercisable Unexercisable
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Frank B. Manning 200,000 $230,544 150,000 50,000 $308,000 $ 71,000
Peter R. Kramer 150,000 $ 49,827 120,000 40,000 $246,400 $ 56,800
Robert A. Crist 98,000 $146,677 20,000 20,000 $ 28,400 $ 28,400
Deena M. Randall 88,000 $145,114 38,000 20,000 $ 71,060 $ 28,400
Terry Manning 60,000 $ 62,678 50,000 15,000 $104,250 $ 21,300
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(1) Based upon the $3.37 closing price of Zoom's Common Stock on December 31,
2004 on the Nasdaq National Market.
Options to purchase Zoom's Common Stock have been granted to executive
officers and other employees of Zoom under Zoom's 1990 Stock Option Plan.
Options to purchase Zoom's Common Stock may also be granted to employees who are
neither officers nor directors of Zoom under Zoom's 1998 Employee Equity
Incentive Plan, as amended (the "1998 Equity Incentive Plan"). The 1990 Stock
Option Plan and the 1998 Plan are each administered by the Compensation
Committee of the Board of Directors. In addition, from time to time, the Board
of Directors has authorized Mr. Manning to award a limited number of options
under the 1998 Equity Incentive Plan throughout the year. For a more detailed
description of the 1990 Stock Option Plan, please see Proposal No. 2 below.
Insider Participation in Compensation Decisions
Decisions regarding executive compensation are made by the Compensation
Committee. The Compensation Committee, currently consisting of Messrs. Furman,
Gordon and Woods, is also responsible for administering the 1990 Stock Option
Plan and the 1998 Equity Incentive Plan, including determining the individuals
to whom stock options are awarded, the terms upon which option grants are made,
and the number of shares subject to each option granted under the 1990 Stock
Option Plan and the 1998 Equity Incentive Plan. No member of the Compensation
Committee is a former or current officer or employee of Zoom. Mr. Manning and
Mr. Kramer, both of whom are executive officers and directors of Zoom, made
recommendations to the Compensation Committee regarding the granting of stock
options and participated in deliberations of the Compensation Committee
concerning executive officer compensation. Neither Mr. Manning nor Mr. Kramer
participated in any vote establishing their compensation.
Compensation Committee Report on Executive Compensation
The primary objectives of the Compensation Committee in developing
executive compensation policies are to enhance the performance of Zoom by
closely aligning the financial interests of Zoom's executive officers with those
of its stockholders and to attract and retain key executives important to the
long-term success of Zoom. To effect these objectives, Zoom pays its executive
officers what the Compensation Committee believes to be relatively low cash
compensation while providing those officers with performance-based long-term
incentive compensation and the opportunity to build an ownership interest in
Zoom through the granting of stock options. None of Zoom's executive officers
received a bonus for 2004. Any future bonuses will be determined by the
Compensation Committee, based on their subjective determination and the future
performance of Zoom.
Frank B. Manning, Zoom's Chief Executive Officer, received cash
compensation for the year ending December 31, 2004, in the amount of $129,272.
The Compensation Committee has not conducted any surveys of salaries of
executive officers, but based upon its experience believes that the cash
compensation of its executive officers, including the compensation received by
Mr. Manning, is low compared to the cash compensation of comparable executive
officers in similarly situated companies. The low level of compensation of Mr.
Manning reflects Mr. Manning's request to limit his cash compensation in favor
of stock options. Mr. Manning was not granted any additional stock options
during 2004.
--------------------------------------------------------------------------------
Compensation Committee:
Bernard Furman
L. Lamont Gordon
J. Ronald Woods
--------------------------------------------------------------------------------
Performance Graph
The following graph compares the annual change in Zoom's cumulative total
stockholder return for the five (5) year period from December 31, 1999 through
December 31, 2004, based upon the market price of Zoom's Common Stock, with the
cumulative total return on the Standard & Poor's 500 Stock Index and the
Standard & Poor's Information Technology Composite Index for that period.
Total Return Comparison
Return Among: 12/31/99 12/31/00 12/31/01 12/31/02 12/31/03 12/31/04
---------------------------------------------------------------------------------------
Information Technology 100.00 59.12 43.75 27.31 40.02 40.88
S&P 500 100.00 89.86 78.14 59.88 75.68 82.49
ZOOM 100.00 37.22 15.41 8.41 43.73 39.94
---------------------------------------------------------------------------------------
The Performance Graph assumes the investment of $100 on December 31, 1999
in Zoom's Common Stock, the Standard & Poor's 500 Stock Index and the Standard &
Poor's Information Technology Composite Index, and the reinvestment of any and
all dividends.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Pursuant to Section 16(a) of the Securities Exchange Act of 1934, Zoom
directors and officers, as well as any person holding more than ten percent
(10%) of Zoom's Common Stock, are required to report initial statements of
ownership of Zoom's securities and any subsequent changes in such ownership to
the Securities and Exchange Commission. Specific filing deadlines of these
reports have been established and Zoom is required to disclose in this proxy
statement any failure to file by these dates during the year ending December 31,
2004. Based on a review of such reports, and on written representations from
reporting persons, Zoom believes that all Section 16(a) filing requirements were
complied with during 2004, except as follows: one transaction was inadvertently
reported one day late on behalf of each of Messrs Furman, Woods and Gordon, each
transaction involving a stock option granted to such persons on July 10, 2004
under Zoom's 1991 Directors Stock Option Plan.
PROPOSAL NO. 2
PROPOSAL TO AMEND THE ZOOM TECHNOLOGIES, INC.
1990 STOCK OPTION PLAN
In March 2005 Zoom's Board of Directors approved, subject to stockholder
approval, an amendment to the Zoom Technologies, Inc. 1990 Stock Option Plan as
amended (the "1990 Stock Option Plan") to increase the number of shares reserved
for issuance under the 1990 Stock Option Plan from 2,800,000 to 3,300,000
shares. As of April 8, 2005 there are 900,646 shares remaining available for
issuance under the 1990 Stock Option Plan, of which 492,100 shares are subject
to currently outstanding stock options.
If the amendment is approved by the stockholders, the second paragraph of
Section 5 of the 1990 Stock Option Plan would be deleted in its entirety and
replaced with the following:
The aggregate number of Shares for which Options may be granted shall not
exceed 3,300,000 Shares, but in no event shall the aggregate number of
Shares under the Plan that may be subject, from time to time, to
outstanding options granted to any one Employee exceed 5% of the Shares of
the Company then outstanding.
Purpose of Plan
The purpose of the 1990 Stock Option Plan is to establish a plan to advance
the interests of Zoom by encouraging equity participation in Zoom by directors
(excluding non-employee directors), officers and employees of Zoom through the
acquisition of shares of Common Stock upon the exercise of options granted under
the 1990 Stock Option Plan.
General Provisions
Any individuals in the full-time or part-time employment of Zoom or an
affiliate of Zoom including Board members who are also employees, consultants
and any other individuals the Board deems to be an employee, is eligible to
receive options under the 1990 Stock Option Plan. As of April 8, 2005, there
were approximately 144 persons eligible to participate in the 1990 Stock Option
Plan.
The 1990 Stock Option Plan is currently administered by the Compensation
Committee, which is a committee consisting of three independent directors
designated by the Board of Directors. The members of the Compensation Committee
are not eligible to receive options under the 1990 Stock Option Plan. The
Compensation Committee determines the persons to whom stock options are granted,
the number of shares covered by the options, the term of any option and the time
during which any option is exercisable. The 1990 Stock Option Plan provides that
the number of shares of Common Stock of Zoom that may be subject, from time to
time, to outstanding options granted to any one employee shall not exceed five
percent (5%) of the outstanding shares of Zoom.
The options granted under the 1990 Stock Option Plan may not be granted at
an exercise price less than the fair market value of the Common Stock on the
date of grant. In order to assist an optionee in the acquisition of shares of
Common Stock pursuant to the exercise of an option granted under the 1990 Stock
Option Plan, the Compensation Committee may authorize payment of the exercise
price in cash, by delivery of shares of Common Stock having a fair market value
equal to the purchase price of the shares, or a combination of cash and shares
of Common Stock.
Subject to the earlier termination of an option in the event of
termination, death or disability, as described below, the Compensation Committee
may, in its sole discretion, at the time of the grant of an option, specify a
particular time period during which the optionee must exercise its option and
the number of options which may be exercised during such designated time period;
provided, however, that no option may expire more than ten (10) years from the
date of grant.
In the event an option holder ceases to be an eligible employee of Zoom for
any reason other than death or disability, the holder's options will terminate
one month following the date of cessation. If an option holder ceases to be an
eligible employee of Zoom as a result of death or disability, the holder's
options will terminate upon the earlier to occur of (i) the passage of sixty
(60) days after the grant of probate of the holder's will or letters of
administration in the case of the death of the holder or (ii) one year after the
date of the holder's death or disability.
Currently the 1990 Stock Option Plan is scheduled to expire on March 31,
2008.
In the event that any option granted under the 1990 Stock Option Plan shall
expire, terminate or be cancelled for any reason without having been exercised
in full, or shall cease for any reason to be exercisable in whole or in part,
the unpurchased shares subject to such option shall be available for subsequent
option grants.
As of April 8, 2005 options to purchase an aggregate of 492,100 shares of
Common Stock (net of terminations) were outstanding under the 1990 Plan,
including those set forth below:
Name Number of Shares Average Exercise Price
Subject to Options Granted
Frank B. Manning 174,100 $1.48
Peter R. Kramer 160,000 $1.48
Robert A. Crist 40,000 $1.48
Deena M. Randall 46,000 $1.48
Terry Manning 47,000 $1.48
All current executive officers 492,100 $1.48
as a group ([6] persons)
All current employees who are
not executive officers, as a group 0
No options have been or will be granted under the 1990 Stock Option Plan to
any director or associate thereof who is not an executive officer of Zoom. No
options have been or will be granted under the 1990 Stock Option Plan to any
associate of an executive officer.
On April 8, 2005 the closing price of Zoom's Common Stock on the Nasdaq
Stock Market's SmallCap Market was $2.80 per share.
Options granted under the 1990 Stock Option Plan may not be transferred.
The Compensation Committee may amend, alter, suspend or discontinue the
1990 Stock Option Plan; provided, however, that the Compensation Committee may
not without stockholder approval make any alteration that would materially
increase the benefits to participants under the l990 Stock Option Plan,
including any amendment which (i)increases the number of shares of Common Stock
for which options may be granted; (ii)reduces the option price of any option;
(iii) alters the eligibility provisions of the 1990 Stock Option Plan, or (iv)
changes the expiration date of the 1990 Stock Option Plan.
Federal Tax Consequences of the 1990 Stock Option Plan
The following general discussion of the federal income tax consequences of
the issuance and exercise of options granted under the 1990 Stock Option Plan is
based upon the provisions of the Internal Revenue Code as in effect on the date
hereof, current, promulgated and proposed regulations thereunder, existing
administrative rulings and pronouncements of the Internal Revenue Service, and
judicial decisions, all of which are subject to change (perhaps with retroactive
effect). This discussion is not intended to be a complete discussion of all of
the federal income tax consequences of the 1990 Stock Option Plan or of all of
the requirements that must be met in order to qualify for the tax treatment
described herein. In addition, because tax consequences may vary, and certain
exceptions to the general rules discussed herein may be applicable, depending
upon the personal circumstances of individual holders of securities, each option
holder should consider his personal situation and consult with his own tax
advisor with respect to the specific tax consequences applicable to him. No
information is provided as to state tax laws. The 1990 Stock Option Plan is not
qualified under Section 401 of the Code, nor is it subject to the provisions of
the Employee Retirement Income Security Act of 1974, as amended.
The recipient of a stock option under the 1990 Stock Option Plan will not
recognize any taxable income upon the grant of an option under the 1990 Stock
Option Plan. Generally, an option holder recognizes ordinary taxable income at
the time an option is exercised in an amount equal to the excess of the fair
market value of the shares of Common Stock on the date of exercise over the
exercise price. However, participants in the 1990 Stock Option Plan, generally
will be subject to Section 16(b) of the Securities Exchange Act of 1934
("Section 16(b)") upon the sale of their shares of Common Stock and this may
affect their tax liability. In the case of exercise of an option by someone
whose sale of shares of Common Stock would subject him to liability under
Section 16(b), recognition of income by the option holder may be postponed. The
rules under Section 16(b) were revised after the Treasury Regulations
promulgated under the Code were adopted, and the regulations have not yet been
amended to conform with the revised rules under Section 16(b). However, it is
generally anticipated that the date of recognition (the "Recognition Date") will
be postponed to the earlier of (i) six months after the date the option was
granted, or (ii) the first day on which the sale of the shares would not subject
the individual to liability under Section 16(b). It is possible that the six
month period will instead run from the option holder's most recent grant or
purchase of Common Stock prior to the exercise of his option. The option holder
will generally recognize ordinary taxable income on the Recognition Date in an
amount equal to the excess of the fair market value of the shares of Common
Stock at that time over the option exercise price. Despite the general rule, in
the case of recipients subject to Section 16(b) (if the Recognition Date is
after the date of exercise), the option holder may make an election pursuant to
Section 83(b) of the Code, in which case the option holder will recognize
ordinary taxable income at the time the stock option is exercised and not on the
later date. In order to be effective, the Section 83(b) election must be made
and filed with Zoom and the IRS within 30 days after exercise.
Zoom will generally be entitled to a compensation deduction for federal
income tax purposes in an amount equal to the taxable income recognized by the
option holder, provided it reports the income on a W-2 or Form 1099, whichever
is applicable, that is timely provided to the option holder and filed with the
IRS.
When an option holder subsequently disposes of the shares of Common Stock
received upon exercise of an option, he will recognize capital gain or loss
equal to the difference between the amount realized and the fair market value on
the date on which the option holder recognized ordinary taxable income as a
result of the exercise of the option. Any such capital gain or loss would be
long term if the holding period for the shares is more than twelve months. The
holding period for the shares generally would begin on the date the shares were
acquired and would not include the period of time during which the option was
held.
An option holder who pays the exercise price, in whole or in part, by
delivering shares of Common Stock already owned by him will recognize no gain or
loss for federal income tax purposes on the shares surrendered, but otherwise
will be taxed according to the rules described above. To the extent the shares
acquired upon exercise are equal in number to the shares surrendered, the basis
of the shares received will be equal to the basis of the shares surrendered. The
basis of shares received in excess of the shares surrendered upon exercise will
be equal to the fair market value of the shares on the date of exercise, and the
holding period for the shares received will commence on that date.
Vote Required to Approve the Amendment to the 1990 Stock Option Plan
The affirmative vote of the holders of a majority of shares of Common Stock
present, in person or by proxy, and entitled to vote at the meeting, is required
to approve the proposal to amend the 1990 Stock Option Plan. Proxies will be
voted in favor of the action unless otherwise instructed by the stockholders.
The Board of Directors recommends a vote FOR the approval of Proposal No. 2, the
amendment to the Zoom Technologies, Inc. 1990 Stock Option Plan.
Equity Compensation Plan Information
Zoom maintains a number of equity compensation plans for its employees,
officers, directors and others whose efforts contribute to Zoom's success. The
table below sets forth certain information as of Zoom's fiscal year ended
December 31, 2004 regarding the shares of its common stock available for grant
or granted under stock option plans that (i) were approved by Zoom's
stockholders, and (ii) were not approved by Zoom's stockholders.
Number Of Securities
Number Of Securities Remaining Available For
To Be Issued Upon Weighted-Average Exercise Future Issuance Under Equity
Exercise Of Price Of Outstanding Compensation Plans (excluding
Outstanding Options, Options, securities reflected in
Plan Category Warrants And Rights Warrants And Rights column a)
------------- ------------------- ------------------------- -----------------------------
(column a)
----------
Equity compensation plans 664,000 $1.7500 646,646
approved by security holders(1)
Equity compensation plans 391,075 $1.9131 421,575
not approved by security holders(2)
----------------------------------- ------------------- ------------------------- -----------------------------
Total 1,055,075 $1.8105 1,068,221
(1) Includes the following plans: Zoom Technologies, Inc. 1990 Stock Option
Plan and Zoom Technologies, Inc. 1991 Directors Stock Option Plan, each as
amended.
(2) Includes the Zoom Technologies, Inc. 1998 Employee Equity Incentive Plan,
as amended (the "1998 Equity Incentive Plan"). The purposes of the 1998
Equity Incentive Plan , adopted by the Board of Directors in 1998, are to
attract and retain employees and provide an incentive for them to assist
Zoom in achieving its long-range performance goals, and to enable such
employees to participate in Zoom's long-term growth. In general, under the
1998 Equity Incentive Plan, all employees who are not officers or directors
are eligible to participate in the 1998 Equity Incentive Plan. The 1998
Equity Incentive Plan is currently administered by the Compensation
Committee of the Board of Directors. Participants in the 1998 Equity
Incentive Plan are eligible to receive non-qualified stock options at an
option price determined by the Compensation Committee. All stock options
granted under the 1998 Plan have been granted for at least the fair market
value on the date of grant. A total of 1,200,000 shares of Zoom's common
stock have been authorized for issuance under the 1998 Equity Incentive
Plan.
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Audit Committee has appointed KPMG LLP as its independent registered
public accounting firm, to audit the consolidated financial statements of Zoom
for the year ending December 31, 2005. A representative of KPMG LLP will be
present at the meeting to make a statement if such representative desires to do
so and to respond to appropriate questions.
Principal Accountant Fees and Services
The following table summarizes the fees of KPMG LLP, the Company's
independent registered public accounting firm, billed to Zoom for each of the
last two years for audit services and billed to Zoom in each of the last two
years for other services:
FEE CATEGORY 2004 2003
------------ ---- ----
Audit fees (1).................. $ 125,291 $ 108,804
Audit-related fees (2).......... 38,784 -
--------- ---------
Audit and audit related fees.... $ 164,075 $ 108,804
Tax fees (3).................... $ 23,340 $ 26,500
All other fees (4).............. - -
--------- ---------
Total fees...................... $ 187,415 $ 135,304
========= =========
(1) Audit Fees. Consists of fees billed for professional services rendered for
the audit of the Company's consolidated financial statements and review of
the interim consolidated financial statements included in quarterly reports
and services that are normally provided by KPMG LLP in connection with
statutory filings and engagements.
(2) Audit-Related Fees. Consists of fees billed for assurance and related
services that are reasonably related to the performance of the audit or
review of the Company's consolidated financial statements and are not
reported under "Audit Fees" and acquisition-related fees for a
non-consummated acquisition transaction.
(3) Tax Fees. Consists of fees billed for professional services for tax
compliance, tax advice and tax planning. In 2004 and 2003, these services
were comprised primarily of services for federal, state and international
tax compliance.
(4) All Other Fees. Consists of fees for products and services other than the
services reported above. During 2004 and 2003, no such services were
provided.
Audit Committee Policy on Pre-Approval of Services of Independent Registered
Public Accounting Firm
The Audit Committee's policy is to pre-approve all audit and permissible
non-audit services provided by the independent registered public accounting
firm. These services may include audit services, audit-related services, tax
services and other services. Pre-approval is generally provided for up to one
year. The Audit Committee may also pre-approve particular services on a
case-by-case basis.
Code of Ethics
Pursuant to Section 406 of the Sarbanes-Oxley Act of 2002, Zoom has adopted
a Code of Ethics for Senior Financial Officers that applies to Zoom's principal
executive officer and its principal financial officer, principal accounting
officer and controller, and other persons performing similar functions. Zoom's
Code of Ethics for Senior Financial Officers is publicly available on its
website at www.zoom.com. If Zoom makes any amendments to this Code of Ethics or
grants any waiver, including any implicit waiver, from a provision of this Code
of Ethics to Zoom's principal executive officer, principal financial officer,
principal accounting officer, controller or other persons performing similar
functions, Zoom will disclose the nature of such amendment or waiver, the name
of the person to whom the waiver was granted and the date of waiver in a current
report on Form 8-K.
DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS AND RECOMMENDATIONS FOR DIRECTOR
Stockholder proposals for inclusion in Zoom's proxy materials for Zoom's
2006 Annual Meeting of Stockholders must be received by Zoom no later than
January 20, 2006. These proposals must also meet the other requirements of the
rules of the Securities and Exchange Commission relating to stockholder
proposals.
Stockholders who wish to make a proposal at Zoom's 2006 Annual Meeting -
other than one that will be included in Zoom's proxy materials - should notify
Zoom no later than April 5, 2006. If a stockholder who wishes to present such a
proposal fails to notify Zoom by this date, the proxies that management solicits
for the meeting will have discretionary authority to vote on the stockholder's
proposal if it is properly brought before the meeting. If a stockholder makes a
timely notification, the proxies may still exercise discretionary voting
authority under circumstances consistent with the proxy rules of the Securities
and Exchange Commission.
Stockholders may make recommendations to the Nominating Committee of
candidates for its consideration as nominees for director at Zoom's 2006 Annual
Meeting of Stockholders by submitting the name, qualifications, experience and
background of such person, together with a statement signed by the nominee in
which he or she consents to act as such, to the Nominating Committee, c/o
Secretary, Zoom Technologies, Inc., 207 South Street, Boston, Massachusetts
02111. Notice of such recommendations should be submitted in writing as early as
possible, but in any event not later than 120 days prior to the anniversary date
of the immediately preceding annual meeting or special meeting in lieu thereof
and must contain specified information and conform to certain requirements set
forth in Zoom's Bylaws. In addition, any persons recommended should at a minimum
meet the criteria and qualifications referred to in the Nominating Committee's
charter, a copy of which is publicly available on Zoom's website at
www.zoom.com. The letter of recommendation from one or more stockholders should
state whether or not the person(s) making the recommendation have beneficially
owned 5% or more of Zoom's Common Stock for at least one year. The Nominating
Committee may refuse to acknowledge the nomination of any person not made in
compliance with the procedures set forth herein, in the Nominating Committee's
Charter or in Zoom's Bylaws.
STOCKHOLDER COMMUNICATIONS
Any stockholder wishing to communicate with any of Zoom's directors
regarding Zoom may write to the director, c/o Investor Relations, Zoom
Technologies, Inc., 207 South Street, Boston, Massachusetts 02111. Investor
Relations will forward these communications directly to the director(s).
OTHER MATTERS
The Board of Directors knows of no other business to be presented for
consideration at the Annual Meeting other than described in this proxy
statement. However, if any other business should come before the Annual Meeting,
it is the intention of the persons named in the proxy to vote, or otherwise act,
in accordance with their best judgment on such matters.
INCORPORATION BY REFERENCE
To the extent that this proxy statement has been or will be specifically
incorporated by reference into any filing by Zoom under the Securities Act of
1933, as amended, or the Securities Exchange Act of 1934, as amended, the
sections of the Proxy Statement entitled "Compensation Committee Report on
Executive Compensation," "Audit Committee Report" and "Performance Graph" shall
not be deemed to be so incorporated, unless specifically otherwise provided in
any such filing.
ANNUAL REPORT ON FORM 10-K
Copies of Zoom's Annual Report on Form 10-K for the year ending December
31, 2004, as filed with the Securities and Exchange Commission, are provided
herewith and available to stockholders without charge upon written request
addressed to Zoom Technologies, Inc., 207 South Street, Boston, Massachusetts
02111, Attention: Investor Relations.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, STOCKHOLDERS
ARE URGED TO FILL IN, SIGN AND RETURN THE ACCOMPANYING FORM OF PROXY IN THE
ENCLOSED ENVELOPE.
By order of the Board of Directors
/s/ Frank Manning, President
Boston, Massachusetts
May 20, 2005
ZOOM TECHNOLOGIES, INC.
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS
JUNE 24, 2005
The undersigned stockholder of ZOOM TECHNOLOGIES, INC., a Delaware corporation
(the "Company"), acknowledges receipt of the Notice of Annual Meeting of
Stockholders and Proxy Statement, dated May 20, 2005, and hereby appoints Frank
B. Manning and Robert A. Crist, and each of them acting singly, with full power
of substitution, attorneys and proxies to represent the undersigned at the
Annual Meeting of Stockholders of the Company to be held at the offices of the
Company, 207 South Street, Boston, Massachusetts 02111, on Friday, June 24,
2005, at 10:00 A.M. Eastern Time, and at any adjournment or adjournments
thereof, with all power which the undersigned would possess if personally
present, and to vote all shares of stock which the undersigned may be entitled
to vote at said meeting upon the matters set forth in the Notice of Meeting in
accordance with the following instructions and with discretionary authority upon
such other matters as may come before the meeting. All previous proxies are
hereby revoked.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. IT WILL BE VOTED AS
DIRECTED BY THE UNDERSIGNED AND IF NO DIRECTION IS INDICATED, IT WILL BE VOTED
FOR THE ELECTION OF THE NOMINEES AS DIRECTORS AND FOR THE PROPOSAL TO AMEND THE
1990 STOCK OPTION PLAN.
---------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES AS DIRECTORS AND FOR
THE PROPOSAL TO AMEND THE 1990 STOCK OPTION PLAN.
1. ELECTION OF DIRECTORS:
[ ] FOR ALL NOMINEES (except as marked to the contrary below)
[ ] WITHHOLD AUTHORITY (to vote for all nominees)
Nominees: FRANK B. MANNING, PETER R. KRAMER, BERNARD FURMAN, JOSEPH J. DONOVAN,
AND J. RONALD WOODS
Vote withheld from the following Nominee(s):
--------------------------------
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE WRITE
THAT NOMINEE'S NAME IN THE SPACE PROVIDED ABOVE.
2. TO AMEND THE COMPANY'S 1990 STOCK OPTION PLAN AS DESCRIBED IN THE PROXY
STATEMENT.
[ ] FOR
[ ] AGAINST
[ ] ABSTAIN
Mark here for [ ]
address change and
note at left
SIGNATURES SHOULD BE THE SAME AS THE NAME PRINTED HEREON. EXECUTORS,
ADMINISTRATORS, TRUSTEES, GUARDIANS, ATTORNEYS, AND OFFICERS OF CORPORATIONS
SHOULD ADD THEIR TITLES WHEN SIGNING.
SIGNATURE: DATE:
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SIGNATURE: DATE:
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