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Zoom Technologies Earns $3.5 Million
On Sale Of InterMute
Potential $3.0 million Additional
May Be Earned By Zoom
Boston, MA, June 6, 2005 — Zoom
Technologies, Inc. (Nasdaq: ZOOM),
a significant InterMute
shareholder, announced today its proceeds from the acquisition
of InterMute by Trend Micro
Incorporated, a U.S. subsidiary of Trend Micro, Japan. InterMute,
a private company that is a
leading developer of anti-spyware products, was purchased
for a base cash amount plus a potential
additional amount depending on the achievement of certain
performance goals. InterMute's sale
will result in an initial cash payment to Zoom in the current
quarter of
approximately $3.5 million. Zoom expects to record a non-operating
gain of $3.5 million ($.39 per
fully diluted share) in its second quarter ending June 30,
2005. Zoom may also receive up to $3.0
million in additional payments in 2006 if certain conditions
and performance targets are met.
In 1999 Ed English, Paul English, and Zoom co-founded AdSubtract.com,
the predecessor to
InterMute. Two of Zoom’s Directors, Peter Kramer and
Frank Manning, have served on
InterMute’s Board since its founding.
Zoom’s total cash investment in InterMute was $467
thousand. Zoom has accounted for its
investment in InterMute under the equity method of accounting,
and since the second quarter of
2002 Zoom has carried the investment at zero value. A majority
of the gain is not expected to be
subject to tax as a result of the utilization of Zoom’s
net operating tax loss carry-forward.
On March 31, 2005 Zoom’s stockholders equity was
$1.27 per share, with the investment in
InterMute carried at zero and Zoom’s real estate recorded
on the balance sheet at well below its
most recent appraised value. Zoom's downtown Boston properties
were valued at $2.3 million on
Zoom's 3/31/05 balance sheet. They were valued at $9.3 million
in the most recent appraisal for
the mortgage lender conducted in August 2002.
“We are very pleased with the success of our investment,
and with the prospects for InterMute and
its employees as part of Trend Micro,” said Frank Manning,
Zoom’s President and CEO. “We
want to give special thanks to Ed English, InterMute’s
President and CEO, for the superb job he
did in conceiving, building, and running InterMute.”
About Zoom
Zoom Technologies, Inc. designs, produces, sells, and supports
Voice over IP gateways, ADSL
modems, cable modems, dial-up modems, Bluetooth products,
and other communications products
under the Zoom, Hayes® and Global Villagetm brands. Zoom
markets its products in over forty
countries, and provides multi-lingual support from its support
offices in Boston, Florida, and the
UK. For more information about Zoom and Zoom's products,
please see: www.zoomtel.com
About Trend Micro
Trend Micro, Inc. is a leader in network antivirus and
Internet content security software and
services. An acknowledged industry innovator, Trend Micro
is the global market leader in server
and gateway-based antivirus software. Sold through an extensive
global network of solution
providers, Trend Micro products and services are used by
large enterprises, government agencies,
educational institutions, small & medium businesses,
and individuals on five continents. For
additional information and evaluation copies of all Trend
Micro products visit our Web site,
www.trendmicro.com
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