Science & Technology
Science and Technology
Science and Technology
Wed, September 9, 2009
Tue, September 8, 2009 Zoom Technologies, Inc.: Zoom Technologies Shareholders Approve Acquisition of Gold Lion
BOSTON, MA--(Marketwire - September 8, 2009) - At a special meeting today, shareholders of Zoom Technologies, Inc. (
Under the terms of the previously announced all-stock agreement, Zoom's shareholders as of the close of business the day before the closing of the acquisition will have shares in two publicly traded companies, the first a vertically integrated China-based manufacturer of mobile phones and other telecommunications devices and the second the spun-off US operating company, Zoom Telephonics. Zoom Telephonics will retain substantially all of Zoom's assets, liabilities, and current operations prior to the acquisition.
The China-based manufacturer of mobile phones will be called Leimone United, Inc. At the special meeting today, 859,444 shares voted for the name change and 5,257 voted against it; short of the required 979,690 votes. Based on provisions of Delaware corporate law, however, the Company will proceed with the name change that more accurately reflects the newly acquired business, as soon as practicable after the acquisition is complete. The spun-off US operating company will retain the name Zoom Telephonics, and has requested that its OTCBB symbol be ZOOM.
The China-based company had revenues of approximately $80.6 million in 2008 and net income of approximately $2.8 million. Q1 2009 revenue was $28.8 million, with $0.9 million net income. Upon completion of the acquisition, Leimone United will own a 100% interest in the holding company Gold Lion, a 100% interest in JS Leimone, which holds a 51.03% interest in TCB Digital, and a 100% interest in Profit Harvest. TCB Digital and JS Leimone primarily design, develop, and manufacture mobile phones and other mobile communication devices; and Profit Harvest is a sales and marketing company for the group. When the acquisition is completed, Zoom's shareholders as of the record date would own 30.67% of this company assuming the company stays on NASDAQ, and 24.32% if the company does not stay on NASDAQ. After the initial closing, another 29% of TCB Digital may be exchanged for additional Zoom shares, which would reduce the Zoom shareholders' stake in the company to 22% assuming the company stays on NASDAQ, and 17% if the company does not stay on NASDAQ. Staying on NASDAQ will require the combined company to meet NASDAQ's initial listing requirements, which depends on a number of factors, including meeting NASDAQ's $4 share price requirement.
Frank Manning, Zoom's current President, CEO, and Chairman, will be a Director of Leimone United and the President, CEO, and Chairman of Zoom Telephonics. "Zoom's management fully supports this transaction," said Frank Manning. "It gives Zoom's shareholders a substantial stake in a growing China-based company in the fastest-growing mobile phone market in the world. In addition, it lets Zoom's shareholders retain ownership of our operating company, Zoom Telephonics, and substantially all of its assets, liabilities, and operations."
Leimone United will be run by Mr. Lei Gu, its majority shareholder and the Chairman and CEO of Gold Lion Holding Ltd., who said: "This is a major milestone for Gold Lion, one of the ten largest Chinese mobile phone manufacturers. We are extremely pleased to have the opportunity to attract U.S. shareholders interested in investing in the fast growing Chinese mobile phone market. We look forward to communicating with our shareholders and providing regular updates on the progress of our burgeoning business."
About Gold Lion Holding Company
Gold Lion is a holding company with subsidiaries that engage in the manufacturing, research and development, and sales of electronic and telecommunication products for 3rd generation mobile phones, wireless communication circuitry, GPS equipment, and related software products. Gold Lion's subsidiary, Jiangsu Leimone, owns a majority stake of TCB Digital which offers highly customized and high quality Electronic Manufacturing Service (EMS) for Original Equipment Manufacturer (OEM) customers and also designs and manufactures its own brand of mobile phones under the Leimone brand. Additional information is available at [ www.leimone.com ].
About Zoom Technologies
Zoom Technologies, Inc. designs, produces, markets, and supports communication products under the Zoom, Hayes®, and Global Village® brands. Zoom is headquartered in Boston, and its European sales and support center is in the UK. Zoom markets its products in over forty countries, and provides multi-lingual support from its offices in Boston and the UK. For more information about Zoom and its products, please see [ www.zoom.com ].
Forward-Looking Statements
This release contains forward-looking information relating to Zoom's plans, expectations, and intentions, including statements relating to Zoom's acquisition and spinoff plans. Actual results may be materially different from expectations as a result of known and unknown risks, including: uncertainty regarding Zoom's ability to maintain listing on the Nasdaq Capital Market and the potential impact of that on its stock price and potential M&A transactions; the possibility that Zoom's acquisition of a China-based vertically integrated mobile phone manufacturer will not occur; and other risks set forth in Zoom's filings with the Securities and Exchange Commission. Zoom cautions readers not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. Zoom expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any such statements to reflect any change in Zoom's expectations or any change in events, conditions or circumstance on which any such statement is based.
