Exhibit 10.4.  Loan Modification Agreement by and between Zoom Telephonics, Inc.
and Fleet National Bank


                           LOAN MODIFICATION AGREEMENT

This Loan Modification  Agreement ("this  Agreement") is made as of November 13,
1997 between Zoom Telephonics, Inc., a Delaware corporation (the "Borrower") and
Fleet National Bank (the "Bank"). For good and valuable  consideration,  receipt
and sufficiency of which are hereby acknowledged,  the Borrower and the Bank act
and agree as follows:

1.  Reference is made to: (i) that certain  letter  agreement  dated January 17,
1997 (the  "Letter  Agreement")  between the  Borrower  and the Bank;  (ii) that
certain $10,000,000 face principal amount promissory note dated January 17, 1997
(the "January  Revolving Note") made by the Borrower and payable to the order of
the Bank;  (iii) that certain  Guaranty  Agreement  dated as of January 17, 1997
(the "FSC Guaranty") from Zoom Telephonics  Foreign Sales Corporation ("FSC") to
the Bank; (iv) that certain Guaranty Agreement dated as of January 17, 1997 (the
"Tribe Guaranty") from Tribe Computer Works, Incorporated ("Tribe") to the Bank;
(v) that certain Inventory and Accounts  Receivable  Security  Agreement of even
date herewith (the "Zoom Security Agreement") given by the Borrower to the Bank;
(vi) that certain Inventory and Accounts  Receivable  Security Agreement of even
date herewith (the "Tribe Security Agreement") given by Tribe to the Bank; (vii)
that certain Inventory and Accounts  Receivable  Security Agreement of even date
herewith (the "FSC  Security  Agreement")  given by FSC to the Bank;  and (viii)
that certain  $5,000,000  face  principal  amount  promissory  note of even date
herewith (the "November Revolving Note") made by the Borrower and payable to the
order of the Bank. The Letter Agreement,  The FSC Guaranty,  the Tribe Guaranty,
the Zoom Security  Agreement,  the Tribe  Security  Agreement,  the FSC Security
Agreement and the November Revolving Note hereinafter  collectively  referred to
as the "Financing Documents".

2. The Letter Agreement is hereby amended, effective as of the date hereof:

        a. By  deleting  from the second  sentence  of Section 1.1 of the Letter
Agreement  the  amount  "$10,000,000"  and  by  substituting  in its  stead  the
following:

               "$5,000,000"

        b. By deleting in its entirety the fourth sentence of Section 1.1 of the
Letter Agreement and by substituting in its stead the following:

               "The   Revolving   Loans  shall  be  evidenced  by  that  certain
               $5,000,000 face principal amount  promissory note (the `Revolving
               Note')  dated  November 13, 1997 made by the Borrower and payable
               to the order of the Bank."

As a result,  all references in the Letter  Agreement to a "Revolving Note" will
be deemed to refer to the November Revolving Note.

        c. By inserting  into Section 1.1 of the Letter  Agreement,  immediately
following the fourth sentence of such Section, the following:

               "The  Revolving  Loans are secured by that certain  Inventory and
               Accounts  Receivable  Security  Agreement dated November 13, 1997
               (the `Security  Agreement') given by the Borrower to the Bank and
               are guaranteed by Tribe  pursuant to that certain  Guaranty dated
               as of January 17, 1997 (the `Tribe  Guaranty')  from Tribe to the
               Bank and by FSC  pursuant to that  certain  Guaranty  dated as of
               January 17, 1997 (the `FSC  Guaranty')  from FSC to the Bank. The
               Tribe Guaranty is secured by that certain  Inventory and Accounts
               Receivable Security Agreement dated November 13, 1997 (the `Tribe
               Security  Agreement')  given  by  Tribe  to the  Bank and the FSC
               Guaranty  is  secured  by that  certain  Inventory  and  Accounts
               Receivable  Security  Agreement dated November 13, 1997 (the `FSC
               Security Agreement') given by FSC to the Bank."



        d.     By deleting in their entireties Sections 1.2 and 1.3 of the
Letter  Agreement and by substituting in their stead the following:

               "1.2.  Interest Rate.  The Revolving  Loans shall be evidenced by
               the Revolving  Note and interest  thereon shall be payable at the
               times and at the rate provided for in the Revolving Note. Overdue
               principal of the Revolving Loans and, to the extent  permitted by
               law,  overdue  interest shall bear interest at a fluctuating rate
               per  annum  which at all  times  shall be equal to the sum of (i)
               four  (4%)  percent  per  annum  plus  (ii)  the per  annum  rate
               otherwise  payable under the  Revolving  Note (but in no event in
               excess of the maximum  rate from time to time  permitted  by then
               applicable law), compounded monthly and payable on demand.

               1.3. Repayment;  Renewal of Revolving Loan Facility. The Borrower
               shall repay in full all Revolving Loans and all interest  thereon
               upon the first to occur of: (i) the  Expiration  Date, or (ii) an
               acceleration under ss.5.2(a)  following an Event of Default.  The
               Borrower may prepay at any time, without penalty or premium,  the
               whole or any portion of any Revolving  Loan.  In addition,  if at
               any time the  Borrowing  Base is in an amount  which is less than
               the then  outstanding  Aggregate Bank  Liabilities,  the Borrower
               will  forthwith  prepay so much of the Revolving  Loans as may be
               required (or arrange for termination of such letters of credit as
               may be required) so that the Aggregate Bank  Liabilities will not
               exceed the Borrowing Base. The Bank may, at its sole  discretion,
               renew the  revolving  financing  arrangements  described  in this
               letter  agreement by extending the  Expiration  Date in a writing
               signed by the Bank and  accepted  by the  Borrower.  Neither  the
               inclusion  in this letter  agreement  or  elsewhere  of covenants
               relating to periods of time after the  Expiration  Date,  nor any
               other  provision  hereof,   nor  any  action  (except  a  written
               extension  pursuant  to  the  immediately   preceding  sentence),
               non-action  or course of  dealing on the part of the Bank will be
               deemed an  extension  of, or agreement on the part of the Bank to
               extend, the Expiration Date."

        e.     By  deleting  in  their  entireties  Sections  1.4,  1.5 and 1.6
of the  Letter Agreement and by substituting in their stead the following:

               "1.4.  Reserved.
               1.5.  Reserved.
               1.6.  Reserved."

        f.     By  deleting  in its  entirety  paragraph  (i)  of  Section  1.7
of the Letter Agreement.

        g.  By  deleting  from  paragraph  (ii)  of  Section  1.7 of the  Letter
Agreement  the words  "(whether or not then subject to any  Eurodollar  Interest
Rate)".

        h.     By deleting in its entirety Section 1.8 of the Letter Agreement.

        i. By  deleting  from the  second  sentence  of the third  paragraph  of
Section 1.9 of the Letter Agreement the word  "Impositions"  and by substituting
in its stead the following:

               "impositions"

        j. By  inserting  into the  third  sentence  of the third  paragraph  of
Section 1.9 of the Letter Agreement,  immediately  after the words  "immediately
available funds", the following:

               "in lawful currency of the United States"

        k. By deleting  from the first  sentence  of Section  1.10 of the Letter
Agreement  the amount  "$10,000,000"  (in each place  where it  appears)  and by
substituting in its stead the following:

               "$5,000,000"

        l. By  inserting  into  Article I of the  Letter  Agreement,  at the end
thereof, the following:

               "1.12.  Foreign  Exchange.  The  Bank  is also  providing  to the
               Borrower  (on terms  agreed to or to be agreed to outside of this
               letter  agreement) a facility  (the `F/X  Facility')  for forward
               foreign exchange contracts (`Foreign Exchange Contracts') between
               the Bank and the  Borrower.  The F/X Facility will have an expiry
               date of  September  30,  1998 and will  permit  Foreign  Exchange
               Contracts in a maximum  aggregate  notional  amount of $1,000,000
               outstanding  at any one  time  and a  $500,000  daily  settlement
               limit."

        m.  By  deleting  the  period  at  the  end of the  second  sentence  of
Subsection  2.1(a) of the Letter  Agreement and by substituting in its stead the
following:

               "and to grant the security interests contemplated by the Security
                Agreement."

        n. By  inserting  into  clause  (i) of  Subsection  2.1(c) of the Letter
Agreement, immediately after the words "any filing", the following:

               "(other  than  filings  under  the  Uniform  Commercial  Code  or
                other relevant record indexing laws)"

        o.     By adding to  Subsection  2.1(j) of the Letter  Agreement, at the
end thereof, the following:

               "All  of the  books  and  records  of the  Borrower  relating  to
               Receivables  and/or  inventory are located at said  address.  The
               principal place of business and chief  executive  offices of each
               of FSC and Tribe are as follows: FSC - 207 South Street,  Boston,
               MA; and Tribe - 207 South  Street,  Boston,  MA. All of the books
               and  records  of FSC and Tribe  relating  to  Receivables  and/or
               inventory  are  located  at the  respective  addresses  described
               above.  Except  as  described  on  item  2.1(j)  of the  attached
               Disclosure Schedule,  none of the inventory of the Borrower,  FSC
               or Tribe is located at any location  other than at the respective
               chief executive offices of the Borrower,  FSC and Tribe described
               above."

        p. By  inserting  into the  introductory  clause to  Article  III of the
Letter Agreement, immediately after the words "letter of credit issued hereunder
shall be outstanding", the following:

               "or  the  F/X  Facility  shall  be in  effect  or any  Foreign
               Exchange Contract shall be outstanding"

        q. By adding to each of clause (i) and clause (ii) of Section 3.6 of the
Letter Agreement, at the end of each such clause, the following:

               "Financial statements delivered under this clause shall include a
               certification  by the chief financial  officer of the Borrower to
               the effect that as at the date of such  financial  statements the
               Tangible  Net  Worth  of the  Borrower  alone  (exclusive  of its
               investment in Subsidiaries and any debt owed by any Subsidiary to
               the  Borrower)  will  not be less  than  90% of the  Consolidated
               Tangible Net Worth of the Borrower and Subsidiaries."

        r. By deleting  from the last sentence of clause (iii) of Section 3.6 of
the  Letter  Agreement  the  words  "compliance  with   ss.ss.3.7-3.10"  and  by
substituting in their stead the following:

               "compliance with each of ss.ss.3.7, 3.8 and 3.10"

        s. By deleting  from clause (vi) of Section 3.6 of the Letter  Agreement
the words  "Sections  3.7,  3.8, 3.9 and/or 3.10" and by  substituting  in their
stead the following:

               "Sections 3.7, 3.8 and/or 3.10"

        t. By deleting in its entirety  Section 3.8 of the Letter  Agreement and
by substituting in its stead the following:

               "3.8.  Capital Base.  The Borrower will maintain as at the end of
               each fiscal quarter  (commencing  with its results as at December
               31,  1997) a  consolidated  Capital  Base of not  less  than  the
               then-effective  Capital Base  Requirement.  As used  herein,  the
               `Capital   Base   Requirement'   will  be  deemed  to  have  been
               $35,000,000  for  September  30, 1997;  and as at the last day of
               each fiscal  quarter  thereafter  (commencing  with  December 31,
               1997)  (each,   a   `Determination   Date'),   the  Capital  Base
               Requirement  will be deemed to become an amount  equal to the sum
               of: (i) that Capital Base Requirement  which was in effect at the
               last day of the immediately  preceding fiscal quarter,  plus (ii)
               50%  of  the   consolidated   Net  Income  of  the  Borrower  and
               Subsidiaries   during   the   fiscal   quarter   ending  at  such
               Determination  Date (but without  giving effect to any Net Income
               which is less than zero for any fiscal quarter)."

        u.     By deleting in its entirety Section 3.9 of the Letter Agreement.

        v. By inserting into the introductory clause to Article IV of the Letter
Agreement,  immediately after the words "letter of credit issued hereunder shall
be outstanding", the following:

               "or  the  F/X  Facility  shall  be in  effect  or any  Foreign
               Exchange Contract shall be outstanding"

        w. By inserting into clause (i) of Section 4.1 of the Letter  Agreement,
immediately after the words "issued by the Bank", the following:

               "and any  Indebtedness in respect of Foreign  Exchange  Contracts
               issued by the Bank"

        x. By  renumbering  clauses  (ix) and (x) of  Section  4.1 of the Letter
Agreement so that same will be known as clauses "(x)" and "(xi)", respectively.

        y. By inserting  into Section 4.1 of the Letter  Agreement,  immediately
after clause (viii) thereof, the following:

               "(ix) any Indebtedness which represents  mortgage debt secured by
               the Borrower's premises at 201 and 207 South Street, Boston, MA;"

        z. By renumbering  clause (vi) of Section 4.2 of the Letter Agreement so
that same will be known as clause "(vii)".

        aa     By  inserting  into  Section  4.2 of the Letter  Agreement,
immediately  after clause (v) thereof, the following:

               "(vi) any mortgage which may hereafter be granted by the Borrower
               encumbering its premises at 201 and 207 South Street, Boston, MA;
               or"

        bb. By inserting into the final  unnumbered  paragraph of Section 4.2 of
the  Letter  Agreement,  immediately  after  the  words  "on  its  assets",  the
following:

               "(other  than  its real  property  at 201  South  Street  and 207
               South Street, Boston, MA)"

        cc.    By deleting  the period at the end of Section 4.3 of the Letter
Agreement  and by substituting in its stead the following:

               ", and (iv) any guaranties in favor of the Bank."

        dd.    By deleting in its  entirety  the first  sentence of Section 4.10
of the Letter Agreement and by substituting in its stead the following:

               "The  Borrower will not change its name or legal  structure  (nor
               permit Tribe and/or FSC to do so), nor will the Borrower move its
               chief  executive  offices or principal place of business from the
               premises  described in Subsection  2.1(j) above (nor permit Tribe
               and/or FSC to do so), nor will the  Borrower  remove any books or
               records  relating to  Collateral  from such  premises (nor permit
               Tribe  and/or  FSC to do so),  nor  will  the  Borrower  keep any
               Collateral  at any location  other than at such premises or other
               premises shown on item 2.1(j) of the attached Disclosure Schedule
               (nor permit Tribe and/or FSC to do so) without, in each instance,
               giving  the  Bank at  least 30 days'  prior  written  notice  and
               providing all such financing  statements,  certificates and other
               documentation  as the Bank may request in order to  maintain  the
               perfection  and  priority of the  security  interests  granted or
               intended to be granted pursuant to the Security Agreement."

        ee.    By  deleting  from  clause  (c) of  Section  5.1 of the  Letter
Agreement  the reference to Section 3.9.

        ff.    By renumbering  clause (n) of Section 5.1 of the Letter Agreement
so that same will be known as clause "(p)".

        gg.    By inserting into Section 5.1 of the Letter  Agreement,
immediately  following clause (m) thereof, the following:

               "(n) the Security Agreement,  the Tribe Security  Agreement,  the
               FSC Security  Agreement or any other Loan Document  shall for any
               reason (other than due to payment in full of all amounts  secured
               or evidenced  thereby or due to discharge in writing by the Bank)
               not  remain  in  full  force  and  effect;  or (o)  the  security
               interests  and liens of the Bank in and on any of the  Collateral
               covered or intended to be covered by the Security Agreement,  the
               FSC security Agreement and/or the Tribe Security Agreement and as
               to which  perfection  may be had under  Article 9 of the  Uniform
               Commercial  Code shall for any reason  (other than due to written
               release by the Bank or due to failure by the Bank to file or take
               other  appropriate  steps  to  perfect  a  security  interest  in
               Collateral  the location of which has been disclosed to the Bank)
               not be fully perfected liens and security interests; or"

        hh.    By  deleting  the period at the end of clause (b) of Section  5.2
of the Letter Agreement and by substituting in its stead the following:

               "and terminate the F/X Facility."

        ii. By inserting into clause (c) of Section 5.2 of the Letter Agreement,
immediately after the words "the Revolving Note", the following:

               ", under the Security  Agreement,  under the FSC Guaranty,  under
               the FSC Security Agreement,  under the Tribe Guaranty,  under the
               Tribe Security Agreement,"

        jj.    By adding to  Section  5.3 of the Letter  Agreement,  at the end
thereof,  the following:

               "ANY AND ALL RIGHTS TO REQUIRE THE BANK TO EXERCISE ITS RIGHTS OR
               REMEDIES WITH RESPECT TO ANY OTHER  COLLATERAL  WHICH SECURES ANY
               OF THE OBLIGATIONS PRIOR TO THE EXERCISE BY THE BANK OF ITS RIGHT
               OF SET-OFF UNDER THIS SECTION ARE HEREBY  KNOWINGLY,  VOLUNTARILY
               AND IRREVOCABLY WAIVED."

        kk. By inserting into Section 6.1 of the Letter  Agreement,  immediately
after the words "the  Revolving  Note",  in each place  where same  appear,  the
following:

               ",  the  Security  Agreement,  the FSC  Security  Agreement,  the
               Tribe Security Agreement"

        ll.    By inserting into Section 6.2 of the Letter  Agreement,
immediately  after the words "0.20% per annum", the following:

               "(0.5% per annum for all periods on or after November 13, 1997)"

        mm. By inserting into Section 6.2 of the Letter  Agreement,  immediately
after  the  amount  "$10,000,000",  in  both  places  where  same  appears,  the
following:

               "($5,000,000 for all periods on or after November 13, 1997)"

        nn. By deleting from Section 6.5 of the Loan Agreement the words "Steven
T.  Shedd,  Chief  Financial  Officer"  and by  substituting  in their stead the
following:

               "Robert Crist, Chief Financial Officer"

        oo.    By inserting into Article VI of the Letter Agreement,  at the end
thereof,  the following:

               "6.9.  Replacement  Note.  Upon  receipt  of an  affidavit  of an
               officer  of  the  Bank  as to the  loss,  theft,  destruction  or
               mutilation  of the  Revolving  Note or of any other Loan Document
               which  is not of  public  record  and,  in the  case of any  such
               mutilation, upon surrender and cancellation of the Revolving Note
               or other Loan Document, the Borrower will issue, in lieu thereof,
               a replacement  Revolving  Note or other Loan Document in the same
               principal  amount (as to the Revolving  Note) and in any event of
               like tenor.

               6.10. Usury. All agreements between the Borrower and the Bank are
               hereby  expressly  limited  so that in no  contingency  or  event
               whatsoever,  whether by reason of acceleration of maturity of the
               Revolving  Note or otherwise,  shall the amount paid or agreed to
               be  paid  to the  Bank  for  the  use or the  forbearance  of the
               Indebtedness represented by the Revolving Note exceed the maximum
               permissible under applicable law. In this regard, it is expressly
               agreed that it is the intent of the Borrower and the Bank, in the
               execution,  delivery and  acceptance  of the  Revolving  Note, to
               contract in strict  compliance with the laws of The  Commonwealth
               of  Massachusetts.   If,  under  any  circumstances   whatsoever,
               performance or fulfillment of any provision of the Revolving Note
               or any of the other Loan  Documents at the time such provision is
               to be performed or fulfilled shall involve exceeding the limit of
               validity  prescribed by applicable law, then the obligation so to
               be performed or fulfilled shall be reduced  automatically  to the
               limits  of  such  validity,   and  if  under  any   circumstances
               whatsoever  the Bank  should  ever  receive as interest an amount
               which would  exceed the highest  lawful  rate,  such amount which
               would be excessive  interest shall be applied to the reduction of
               the principal  balance evidenced by the Revolving Note and not to
               the payment of  interest.  The  provisions  of this  Section 6.10
               shall control every other provision of this letter  agreement and
               of the Revolving Note.

               6.11.  WAIVER OF JURY  TRIAL.  THE  BORROWER  AND THE BANK HEREBY
               KNOWINGLY, VOLUNTARILY AND INTENTIONALLY MUTUALLY WAIVE THE RIGHT
               TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED HEREON,  ARISING
               OUT OF, UNDER OR IN CONNECTION  WITH THIS LETTER  AGREEMENT,  THE
               REVOLVING  NOTE OR ANY OTHER LOAN  DOCUMENTS OR OUT OF ANY COURSE
               OF  CONDUCT,  COURSE  OF  DEALING,  STATEMENTS  (WHETHER  ORAL OR
               WRITTEN)  OR ACTIONS  OF ANY PARTY.  THIS  WAIVER  CONSTITUTES  A
               MATERIAL  INDUCEMENT  FOR THE  BANK TO  ENTER  INTO  THIS  LETTER
               AGREEMENT AND TO MAKE REVOLVING LOANS AS CONTEMPLATED HEREIN."

        pp. By deleting in their entireties the following  definitions appearing
in Section 7.1 of the Letter Agreement: "Eurocurrency Liabilities",  "Eurodollar
Interest Rate",  "Eurodollar  Rate Increment",  "Floating Rate",  "Floating Rate
Loan",  "Impositions",  "Interest  Payment Date",  "Interest  Period",  "LIBOR",
"LIBOR Loan",  "London",  "Other  Acceptable  Foreign  Receivables" and "Reserve
Rate".

        qq. By deleting from the definition of "Bank  Certificate"  appearing in
Section 7.1 of the Letter Agreement the references to Sections 1.2 and 1.6.

        rr. By deleting in its  entirety  the  definition  of  "Borrowing  Base"
appearing  in Section 7.1 of the Letter  Agreement  and by  substituting  in its
stead the following:

               "`Borrowing Base' - As determined at any date, the sum of (i) 70%
               of the  aggregate  principal  amount  of the  Qualified  Domestic
               Receivables of the Borrower then outstanding plus (ii) 70% of the
               aggregate  principal  amount  of the  Qualified  Insured  Foreign
               Receivables of the Borrower then outstanding."

        ss.    By deleting in its entirety the proviso  clause in the definition
of "Business Day" appearing in Section 7.1 of the Letter Agreement.

        tt.    By inserting into Section 7.1 of the Letter Agreement,
immediately  after the definition of "Capital Base", the following:

               "`Collateral'  - All  property  now  or  hereafter  owned  by the
               Borrower,  FSC and/or Tribe or in which the Borrower,  FSC and/or
               Tribe  has any  interest,  but only to the  extent  that  same is
               described  as  `Collateral'  in the Security  Agreement,  the FSC
               Security  Agreement  and/or the Tribe  Security  Agreement  or in
               Subsection 7.2(b) below."

        uu. By deleting from the  definition of "Expiration  Date"  appearing in
Section  7.1  of  the  Letter  Agreement  the  date  "August  31,  1997"  and by
substituting in its stead the following:

               "September 30, 1998"

As a result,  from and after the date  hereof,  for the  purposes  of the Letter
Agreement  and the other  Financing  Documents,  the  "Expiration  Date" will be
deemed to be September 30, 1998.

        vv.    By inserting into Section 7.1 of the Letter  Agreement,
immediately  after the definition of "Expiration Date", the following:

               "`Foreign Exchange Contracts' - As defined in ss.1.12 above.

               `FSC Guaranty' - As defined in ss.1.1 above.

               `FSC Security Agreement' - As defined in ss.1.1 above.

               `F/X Facility' - As defined in ss.1.12 above."

        ww. By inserting  into the definition of "Loan  Documents"  appearing in
Section  7.1 of the Letter  Agreement,  immediately  after the words  "Revolving
Note", the following:

               ", the  Security  Agreement,  the Tribe  Guaranty,  the  Tribe
               Security Agreement, the FSC Guaranty, the FSC Security Agreement"

        xx. By  deleting  from the  definition  of  "Maximum  Revolving  Amount"
appearing in Section 7.1 of the Letter Agreement the amount "$10,000,000" and by
inserting in its stead the following:

               "$5,000,000"

        yy.    By deleting the period at the end of the definition of
"Obligations"  appearing in Section 7.1 of the Letter Agreement and by
substituting in its stead the following:

               ",  including,  without  limitation,  the Revolving Loans and any
               obligations  now or  hereafter  arising  with  respect to Foreign
               Exchange Contracts."

        zz. By deleting in its entirety clause (i) of the second sentence of the
definition of "Qualified Domestic  Receivables"  appearing in Section 7.1 of the
Letter Agreement and by substituting in its stead the following:

               "(i)  (A) if the  Bank  does  not  have a fully  perfected  first
               priority  security  interest  in such  Receivable  or (B) if such
               Receivable  is not free and  clear of all  adverse  interests  in
               favor of any Person other than the Borrower and the Bank;"

        aaa.  By  renumbering  clause  (viii)  of  the  second  sentence  of the
definition of "Qualified Domestic  Receivables"  appearing in Section 7.1 of the
Letter Agreement so that it will be known as clause (ix) thereof.

        bbb.  By  inserting  into  the  second  sentence  of the  definition  of
"Qualified  Domestic  Receivables"  appearing  in  Section  7.1  of  the  Letter
Agreement, immediately following clause (vii) thereof, the following:

               "(viii)  if  such   Receivable  is  owed  by  the  United  States
               government or any agency or department  thereof (unless  assigned
               to the Bank under the Federal Assignment of Claims Act);"

        ccc. By deleting in its entirety the last sentence of the  definition of
"Qualified  Domestic  Receivables"  appearing  in  Section  7.1  of  the  Letter
Agreement and by substituting in its stead the following:

               "In  addition,  so  long as the  Tribe  Guaranty  and  the  Tribe
               Security  Agreement are in full force and effect and the Bank has
               a fully  perfected  first  priority  security  interest in all of
               Tribe's Receivables,  term `Qualified Domestic  Receivables' will
               be deemed to include such  Receivables  (the `Tribe  Intercompany
               Receivables')  as are  now or  hereafter  owed  by  Tribe  to the
               Borrower (even though such Tribe  Intercompany  Receivables would
               otherwise be excluded as being  amounts owed to the Borrower by a
               related entity) to the extent, but only to the extent,  that such
               Tribe  Intercompany   Receivables  arise  out  of  sales  of  the
               Borrower's products made by Tribe to unrelated customers and that
               the  Receivables  of Tribe  (the  `Matching  Tribe  Receivables')
               generated by such sales satisfy all of the requirements set forth
               in  the  immediately  preceding  two  sentences  to be  Qualified
               Domestic Receivables,  except that such Matching Tribe Receivable
               will not be owned by the Borrower."

        ddd. By deleting in its entirety the  definition of  "Qualified  Foreign
Receivables"   appearing  in  Section  7.1  of  the  Letter   Agreement  and  by
substituting in its stead the following:

               "`Qualified  Insured Foreign  Receivables' - Those Receivables of
               the Borrower which satisfy all of the criteria set forth above to
               be Qualified Domestic Receivables other than the requirement that
               the relevant  customer be located in the United States;  provided
               that each such Qualified Insured Foreign  Receivable is supported
               by credit insurance issued by an insurer satisfactory to the Bank
               and containing terms and conditions  satisfactory to the Bank. In
               addition,  so  long  as the FSC  Guaranty  and  the FSC  Security
               Agreement  are in full  force and effect and the Bank has a fully
               perfected  first  priority  security  interest  in all  of  FSC's
               Receivables,  the term `Qualified  Insured  Foreign  Receivables'
               will be deemed to include such Receivables (the `FSC Intercompany
               Receivables') as are now or hereafter owed by FSC to the Borrower
               (even though such FSC Intercompany Receivables are not themselves
               insured and would  otherwise be excluded as being amounts owed to
               the Borrower by a related entity) to the extent,  but only to the
               extent, that the FSC Intercompany  Receivables arise out of sales
               of the Borrower's products made by FSC to unrelated customers and
               that the  Receivables  of FSC (the  `Matching  FSC  Receivables')
               generated  by  such  sales  are  insured  with  credit  insurance
               satisfactory   to  the  Bank  and   satisfy   all  of  the  other
               requirements  set forth  above to be  Qualified  Insured  Foreign
               Receivables,  except that such Matching FSC Receivables  will not
               be owned by the Borrower.  Amounts included in Qualified  Insured
               Foreign Receivables will in no event be `double counted' with any
               amounts includable in Qualified Domestic Receivables."

        eee.   By inserting  into Section 7.1 of the Letter  Agreement
immediately  after the definition of "Tribe", the following:

               "`Tribe Guaranty' - As defined in ss.1.1 above.

               `Tribe Security Agreement' - As defined in ss.1.1 above."

        fff.   By adding to  Article  VII of the Letter  Agreement,  at the end
thereof,  the following:

               "7.2. Security Agreement. (a) Each of the Borrower, FSC and Tribe
               acknowledges and agrees that the  `Obligations'  described in and
               secured by the Security Agreement, the FSC Security Agreement and
               the Tribe Security Agreement include, without limitation,  all of
               the  obligations  of the Borrower under the Revolving Note and/or
               this letter agreement and/or with respect to any Foreign Exchange
               Contracts.

                      (b)  Each of the  Security  Agreement,  the  FSC  Security
               Agreement and the Tribe Security  Agreement is hereby modified to
               provide as follows:

                      (i)  That  the  `Collateral'   subject  thereto  includes,
               without  limitation and in addition to the  Collateral  described
               therein,  all of the  Borrower's,  FSC's and Tribe's (as the case
               may be) files, books and records (including,  without limitation,
               all  electronically  recorded  data)  all  whether  now  owned or
               existing or hereafter acquired,  created or arising.  Each of the
               Borrower,  FSC and Tribe  hereby  grants  to the Bank a  security
               interest in all such  Collateral  in order to secure the full and
               prompt payment and performance of all of the Obligations.

                      (ii) That, upon the occurrence of any Event of Default (as
               defined in ss.5.1 of this letter agreement), the Bank may, at any
               time,  without  further  notice  to the  Borrower,  FSC or Tribe,
               notify  account  debtors that the Collateral has been assigned to
               the Bank and that payments by such account  debtors shall be made
               directly  to the Bank.  At any time  after the  occurrence  of an
               Event of Default, the Bank may collect the Borrowers',  FSC's and
               Tribe's  Receivables,  or  any of  same,  directly  from  account
               debtors and may charge the  collection  costs and expenses to the
               Borrower."

        ggg.   By adding to the Letter  Agreement,  as an exhibit thereto,  Item
2.1(j) in the form attached to this Agreement.

        3. Each of Tribe and FSC hereby  joins in the Letter  Agreement  for the
purposes  described  in  Paragraph  2fff  above and each of Tribe and FSC hereby
grants to the Bank,  in order to secure the  Obligations  (as  described in said
Paragraph 2fff above),  a security  interest in and to all of the Collateral (as
described in said Paragraph 2fff above).

        4. Wherever in any Financing Document,  or in any certificate or opinion
to be  delivered  in  connection  therewith,  reference  is  made  to a  "letter
agreement"  or to the  "Letter  Agreement",  from and after the date hereof same
will be deemed to refer to the Letter Agreement, as hereby amended.

        5. Simultaneously with the execution and delivery of this Agreement, the
Borrower is executing and delivering to the Bank the November Revolving Note, in
substitution  for the January  Revolving Note. The November  Revolving Note is a
$5,000,000  promissory note of the Borrower,  substantially in the form attached
hereto as  Exhibit  1.  Wherever  in any of the  Financing  Documents  or in any
certificate  or opinion to be delivered in  connection  therewith,  reference is
made to a "Revolving  Note",  from and after the date hereof same will be deemed
to refer to the November Revolving Note.

        6. Each of Tribe and FSC  confirms  that each of the Tribe  Guaranty and
the FSC Guaranty, respectively, remains in full force and effect and guarantees,
inter alia,  payment and performance of the Letter Agreement (as hereby amended)
and the November Revolving Note.

        7. In  order  to  induce  the Bank to enter  into  this  Agreement,  the
Borrower further represents and warrants as follows:

        a. The  execution,  delivery  and  performance  of this  Agreement,  the
November  Revolving  Note  and  the  Zoom  Security  Agreement  have  been  duly
authorized by the Borrower by all necessary corporate and other action, will not
require the consent of any third party and will not conflict  with,  violate the
provisions of, or cause a default or constitute an event which, with the passage
of time or the  giving of notice or both,  could  cause a default on the part of
the  Borrower  under its  charter  documents  or by-laws or under any  contract,
agreement, law, rule, order, ordinance, franchise, instrument or other document,
or result in the imposition of any lien or  encumbrance  (except in favor of the
Bank) on any property or assets of the  Borrower.  The  execution,  delivery and
performance  of this  Agreement  and the FSC Security  Agreement  have been duly
authorized by FSC by all necessary  corporate and other action, will not require
the  consent  of any  third  party  and  will not  conflict  with,  violate  the
provisions of, or cause a default or constitute an event which, with the passage
of time or the  giving of notice or both,  could  cause a default on the part of
FSC under its charter  documents  or by-laws or under any  contract,  agreement,
law, rule, order, ordinance,  franchise, instrument or other document, or result
in the  imposition of any lien or  encumbrance  (except in favor of the Bank) on
any property or assets of FSC. The execution,  delivery and  performance of this
Agreement and the Tribe Security Agreement have been duly authorized by Tribe by
all necessary  corporate  and other action,  will not require the consent of any
third party and will not conflict  with,  violate the  provisions of, or cause a
default or constitute an event which,  with the passage of time or the giving of
notice or both,  could  cause a default on the part of Tribe  under its  charter
documents  or  by-laws  or under any  contract,  agreement,  law,  rule,  order,
ordinance,  franchise, instrument or other document, or result in the imposition
of any lien or  encumbrance  (except  in favor of the Bank) on any  property  or
assets of Tribe.

        b. The Borrower has duly executed and delivered each of this  Agreement,
the  November  Revolving  Note and the  Zoom  Security  Agreement.  FSC has duly
executed and delivered  each of this  Agreement and the FSC Security  Agreement.
Tribe has duly  executed  and  delivered  each of this  Agreement  and the Tribe
Security Agreement.

        c. Each of this  Agreement,  the  November  Revolving  Note and the Zoom
Security  Agreement is the legal,  valid and binding obligation of the Borrower,
enforceable  against the Borrower in accordance with its respective  terms. Each
of this Agreement and the FSC Security Agreement is the legal, valid and binding
obligation of FSC,  enforceable  against FSC in accordance  with its  respective
terms.  Each of this  Agreement and the Tribe  Security  Agreement is the legal,
valid and binding obligation of Tribe,  enforceable  against Tribe in accordance
with its respective terms.

        d. The  statements,  representations  and warranties  made in the Letter
Agreement,  in the Tribe  Guaranty  and/or in the FSC  Guaranty  continue  to be
correct as of the date hereof; except as amended, updated and/or supplemented by
the attached Supplemental Disclosure Schedule.

        e.  Giving  effect  to  the  foregoing  amendments,  the  covenants  and
agreements of the Borrower,  FSC and/or Tribe contained in the Letter Agreement,
in the Zoom  Security  Agreement,  in the FSC Security  Agreement,  in the Tribe
Security  Agreement,  in the FSC Guaranty and/or in the Tribe Guaranty have been
complied with on and as of the date hereof.

        f. Giving effect to the foregoing amendments, no event which constitutes
or which, with notice or lapse of time, or both, could  constitute,  an Event of
Default (as defined in the Letter Agreement) has occurred and is continuing.

        g.  Except for certain  losses  heretofore  disclosed  in writing to the
Bank, no material adverse change has occurred in the financial  condition of the
Borrower  from that  disclosed  in the  quarterly  financial  statements  of the
Borrower dated June 30, 1997, heretofore furnished to the Bank.

        8. As a further inducement to the Bank to enter into this Agreement,  on
or about the date  hereof the  Borrower  is paying to the Bank a  non-refundable
amendment fee of $5,000. This fee is in addition to, and is not to be reduced by
nor applied against,  any other fees, interest or other payments now, heretofore
or  hereafter  paid or payable  by the  Borrower  to the Bank under the  January
Revolving Note, the November  Revolving Note, the Letter  Agreement or any other
Financing Documents.

        9. Except as expressly affected hereby, the Letter Agreement and each of
the other Financing Documents remains in full force and effect as heretofore.

        10. Nothing  contained herein will be deemed to constitute a waiver or a
release of any provision of any of the Financing  Documents.  Nothing  contained
herein will in any event be deemed to  constitute  an agreement to give a waiver
or release or to agree to any amendment or  modification of any provision of any
of the Financing Documents on any other or future occasion.

        Executed,  as an  instrument  under  seal,  as of the day and year first
above written.

                                                   ZOOM TELEPHONICS, INC.


                                                   By:       /s/ Robert A. Crist
                                                      Name: Robert A. Crist
                                                      Title: V.P. Finance & CFO


                                                   By:         /s/ Frank Manning
                                                      Name: Frank Manning
                                                      Title: President & CEO
Accepted and agreed:
FLEET NATIONAL BANK


By:              /s/ Kimberly Martone
    Name: Kimberly Martone
    Title: Vice President

Agreed (as to Sections 3 and 6 above):

ZOOM TELEPHONICS FOREIGN
  SALES CORPORATION


By:            /s/ Frank Manning
     Name: Frank Manning
     Title: President & CEO


TRIBE COMPUTER WORKS, INCORPORATED



By:            /s/ Frank Manning
     Name: Frank Manning
     Title: President & CEO