UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q/A

(Mark One)

[X]       QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
             SECURITIES EXCHANGE ACT OF 1934    
             FOR THE QUARTER ENDED SEPTEMBER 30, 2013

OR

[  ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934
 For the transition period from ________to _________

Commission file number 000-18672



ZOOM TECHNOLOGIES, INC.



|Delaware                                                       | 51-0448969                             
|-------------------------------------------------------------- | ---------------------------------------
|(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification Number)

Headquarters:
                                                Sanlitun SOHO, Building A, 11th Floor 
                                                  No. 8 Workers Stadium North Road 
                                                Chaoyang District, Beijing, China 100027

U.S. office:
                                                    c/o Ellenoff Grossman & Schole LLP
                                                        1345 Avenue of Americas, 
                                                             New York, NY 10105 (Address of principal executive offices including zip code)

(845) 507-8200



Explanatory Note:  Pursuant to Rule 405(a)(2) of Regulation S-T, the registrant is relying upon the applicable 30-day grace period for the
initial filing of its first Interactive Data File required to contain detail-tagged footnotes or schedules.  The registrant intends
to file the required detail-tagged footnotes or schedules by the filing of an amendment to this Quarterly Report on Form 10-Q within the 30-day period.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a
smaller reporting company. See definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company"
in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer      ̈
Accelerated filer     ̈
Non-accelerated filer     ̈ (Do not check if a smaller reporting company)
Smaller reporting company    xIndicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
YES     ̈ NO    x Applicable only to corporate issuers:

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date:
The number of shares of common stock, par value $0.01, outstanding as of November 18, 2013 is 3,008,517.
EXPLANATORY NOTE
ZOOM TECHNOLOGIES, INC. (the "Company") is filing this Quarterly Report on Form 10-Q/A (the "Form 10-Q/A") for the quarterly period
ended September 30, 2012 to regain compliance with Regulation S-X 10-01(d) which states that prior to filing, interim financial statements included in
quarterly reports on Form 10-Q (17 CFR 249.308(a)) must be reviewed by an independent public accountant using professional standards and
procedures for conducting such reviews, as established by generally accepted auditing standards, as may be modified or supplemented by the
Commission.  On November 19, 2013, the Company mistakenly authorized filing of the form 10-Q for the period ended
September 30, 2013 (the "Original 10-Q") prior to completion of the review performed by a registered public accounting firm.
The registered public accounting firm completed their review of this Form 10-Q/A.
Their report is found on Page 30 of this Form 10-Q/A. The Company has implemented
improved internal control policies over financial reporting to mitigate the risk of such accidents occurring again in the future.








iZoom Technologies, Inc.
                                               Affiliates and Subsidiaries 

FORM 10-Q/A


TABLE OF CONTENTS

Part I.

Consolidated Financial InformationItem 1.

Condensed Consolidated Financial Statements

2Condensed Consolidated Balance Sheetsas of September 30, 2013 (Unaudited) and December 31, 2012

2Condensed Consolidated Statements of Operationsfor The Three and Nine Months ended September 30, 2013 and 2012 (Unaudited)

3Condensed Consolidated Statements of Comprehensive Income (Loss)for The Three and Nine Months ended September 30, 2013 and 2012 (Unaudited)

4Condensed Consolidated Statements of Cash
Flowsfor The Nine Months ended September 30, 2013 and 2012 (Unaudited)

5Notes to Condensed Consolidated Financial Statements

6Report of Independent Registered Accounting Firm

30Item 2.

Management's Discussion and Analysis of Consolidated Financial Condition and Results of Operations

31Item 3.

Quantitative and Qualitative Disclosures About Market Risk

37Item 4.

Controls and Procedures

37Part II.

Other InformationItem 1.

Legal Proceedings

40Item 1A.

Risk Factors

40Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

40Item 3.

Default Upon Senior Securities

40Item 4.

Mine Safety Disclosures

40Item 5.

Other Information

40Item 6.

Exhibits

40Signatures



41Exhibits



421PART I — FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements 



ZOOM TECHNOLOGIES, INC., AFFILIATES & SUBSIDIARIES
                                       CONDENSED CONSOLIDATED BALANCE SHEETS


SEPTEMBER 30,


DECEMBER 31,2013


2012(Unaudited)ASSETSCurrent assetsCash and equivalents

$
1,818,816

$
8,351Restricted cash


19,555,440


19,044,294Other receivables and prepaid expenses


1,217,441


3,989,362Due from related parties


13,619,198


20,528,155Current assets of discontinued operations, held for sale


139,390,295


179,884,224Total current assets


175,601,190


223,454,386Intangible assets


349,600


349,600Long-term investments


11,754,210


11,912,956TOTAL ASSETS

$
187,705,000

$
235,716,942LIABILITIES AND EQUITYCurrent liabilitiesNotes payable


350,937


-Accounts payable


36,948


38,695Accrued expenses and other payables


535,530


1,237,505Purchase deposit from buyer


8,240,490


8,740,490Taxes payable


22,951


22,334Due to related parties


2,966,000


5,362,597Warrant liability


-


7,340Current liabilities of discontinued operations


140,007,731


155,343,024Total current liabilities


152,160,587


170,751,985Long-term notes payables


-


317,500TOTAL LIABILITIES


152,160,587


171,069,485COMMITMENTS AND CONTINGENCIESEQUITYSTOCKHOLDERS' EQUITYPreferred stock: authorized 1,000,000 shares, par value $0.01 none issued and outstanding


-


-Common stock: authorized 60,000,000 shares, par value $0.01; 3,008,517 shares issuedand outstanding at September 30, 2013; 2,932,085 shares issued and2,931,917 shares outstanding at December 31, 2012


30,085


29,319Treasury shares: 168 shares at cost


(7,322)


(7,322)Additional paid-in capital


52,625,042


51,372,282Statutory surplus reserve


737,623


702,539Accumulated other comprehensive income


2,739,347


4,058,655Accumulated deficit


(22,416,508)


(4,098,798)TOTAL STOCKHOLDERS' EQUITY


33,708,267


52,056,675Non-controlling interest


1,836,146


12,590,782TOTAL EQUITY


35,544,413


64,647,457TOTAL LIABILITIES AND EQUITY

$
187,705,000

$
235,716,942The accompanying notes are an integral part of these condensed consolidated financial statements.

2ZOOM TECHNOLOGIES, INC., AFFILIATES & SUBSIDIARIES
                                  CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS


THREE MONTHS ENDED


NINE MONTHS ENDEDSEPTEMBER 30,


SEPTEMBER 30,2013


2012


2013


2012(Unaudited)


(Unaudited)


(Unaudited)


(Unaudited)Net revenues

$
-

$
-

$
-

$
-Cost of sales


-


-


-


-Gross profit


-


-


-


-Operating expenses:Selling, general, and administrative expenses


110,308


135,646


885,947


869,938Non-cash equity-based compensation


132,259


758,592


777,924


2,030,151Total operating expenses


242,567


894,238


1,663,871


2,900,089Loss from operations


(242,567)


(894,238)


(1,663,871)


(2,900,089)Other income and (expenses)Interest income


314


1


314


12Interest expense


(8,006)


(901)


(153,199)


(27,151)Change in fair value of warrants


4


523,078


7,340


523,078Investment gain (loss)


174,895


(423,630)


(158,746)


(423,630)Other (expense) income, net


(309,838)


1,105


778


(293)Other income (expense), net


(142,631)


99,653


(303,513)


72,016Loss before income taxes and noncontrolling interest


(385,198)


(794,585)


(1,967,384)


(2,828,073)Income taxes for continuing operations


-


11,289


109,517


11,289Loss attributable to Zoom Technologies, Inc. from continuing operations


(385,198)


(805,874)


(2,076,901)


(2,839,362)Discontinued Operations:(Loss) income from discontinued operations, net of tax


(3,680,361)


1,748,821


(4,226,587)


5,064,578less: (loss) income attributable to noncontrolling interest from discontinued operations


(616,946)


190,633


(729,690)


177,708(3,063,415)


1,558,188


(3,496,897)


4,886,870Loss on disposal, net tax


(10,642,204)


-


(12,708,828)


-(Loss) income attributable to Zoom Technologies, Inc. from discontinued operations


(13,705,619)


1,558,188


(16,205,725)


4,886,870Net (loss) income attributable to Zoom Technologies, Inc.

$
(14,090,817)

$
752,314

$
(18,282,626)

$
2,047,508Basic and diluted loss per common share from continuing operations:Basic

$
(0.13)

$
(0.28)

$
(0.69)

$
(1.07)Diluted

$
(0.13)

$
(0.28)

$
(0.69)

$
(1.07)Basic and diluted (loss) income per common share from discontinued operations:Basic

$
(4.57)

$
0.54

$
(5.42)

$
1.85Diluted

$
(4.57)

$
0.54

$
(5.42)

$
1.85Basic and diluted (loss) income per common shareBasic

$
(4.70)

$
0.26

$
(6.11)

$
0.77Diluted

$
(4.70)

$
0.26

$
(6.11)

$
0.77Weighted average common shares outstanding:Basic


2,999,387


2,911,470


2,990,836


2,643,145Diluted


2,999,387


2,911,470


2,990,836


2,646,830The accompanying notes are an integral part of these condensed consolidated financial statements.

3ZOOM TECHNOLOGIES, INC., AFFILIATES & SUBSIDIARIES
                                  CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)


THREE MONTHS ENDED


NINE MONTHS ENDEDSEPTEMBER 30,


SEPTEMBER 30,2013


2012


2013


2012(Unaudited)


(Unaudited)


(Unaudited)


(Unaudited)Net (loss) income attributable to Zoom Technologies, Inc.

$
(14,090,817)

$
752,314

$
(18,282,626)

$
2,047,508Net (loss) income attributable to noncontrolling interest


(616,946)


190,633


(729,690)


177,708Other comprehensive income:Foreign currency translation (loss) gain - Zoom Technologies, Inc.


(2,097,745)


(333,330)


(1,319,310)


56,387Foreign currency translation (loss) gain - noncontrolling interest


(762,769)


588


(568,160)


24,481Comprehensive (loss) income Zoom Technologies, Inc.


(16,188,562)


418,984


(19,601,936)


2,103,895Comprehensive (loss) income noncontrolling interest

$
(1,379,715)

$
191,221

$
(1,297,850)

$
202,189The accompanying notes are an integral part of these condensed consolidated financial statements.

4ZOOM TECHNOLOGIES, INC., AFFILIATES & SUBSIDIARIES
                                     CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


NINE MONTHS ENDEDSEPTEMBER 30,2013


2012(Unaudited)


(Unaudited)Cash flows from operating activities:Net (loss) income attributable to Zoom Technologies, Inc.

$
(18,282,626)

$
2,047,508Adjustments to reconcile net (loss) income attributable to Zoom Technologies Inc. tocash provided by (used in) operating activities:(Loss) income attributable to noncontrolling interest from discontinued operations


(729,690)


177,708Depreciation and amortization


844,603


1,268,053Non-cash equity-based compensation


777,924


2,030,151Provision for inventory obsolescence


-


361,039Provision on accounts receivable


2,518,987


1,559,674Loss on disposal


12,708,828


-Loss on investment in joint venture


158,746


423,630Fair value adjustment on warrants


(7,340)


(523,078)Changes in deferred tax assets


-


56,649Changes in operating assets and liabilities:Accounts receivable


(3,160,104)


(38,096,887)Inventories


(6,076,358)


(5,256,775)Advances to suppliers


(29,449)


(728,846)Prepaid expenses and other assets


9,431,490


(5,713,871)Accounts payable


8,768,972


24,834,057Advance from customers


(203,745)


2,026,810Related parties-net


(434,012)


3,998,291Accrued expenses and other current liabilities


2,752,907


6,278,056Net cash provided by (used in) operating activities


9,039,133


(5,257,831)Cash flows from investing activities:Restricted cash


(3,390,538)


(792,581)Purchase of property and equipment and other long-term assets


(727,785)


(359,098)Proceeds from collection on notes receivable


234,078


(5,384,577)Cash disposed upon disposal of subsidiary


(740,616)


-Equity method investee


-


(12,364,270)Refund from factory construction deposit


-


10,261,417Net cash used in investing activities


(4,624,861)


(8,639,109)Cash flows from financing activities:Proceeds from loans


23,042,792


3,201,559Repayment to loans


1,134


(1,506,339)Repayment on notes payable


-


(4,457,729)Receipt from related parties


103,721


25,697,445Payments to related parties


(20,173,332)


(6,379,117)Repayments on long-term loan


-


(7,250)Net cash provided by financing activities


2,974,315


16,548,569Effect of exchange rate changes on cash & equivalents


(515,174)


21,228Net increase in cash and equivalents


6,873,413


2,672,857Cash and equivalents, beginning of period


3,676,275


1,131,109Cash and equivalents of continuing components


8,351


22,158Cash and equivalents of discontinued components


3,667,924


1,108,951Cash and equivalents, end of period

$
10,549,688

$
3,803,966Cash and equivalents of continuing components


1,818,816


11,484Cash and equivalents of discontinued components


8,730,872


3,792,482SUPPLEMENTARY DISCLOSURES:Interest paid

$
2,136,419

$
1,924,763Income tax paid

$
109,517

$
2,813,825The accompanying notes are an integral part of these condensed consolidated financial statements.


5ZOOM TECHNOLOGIES, INC., AFFILIATES & SUBSIDIARIES  
                         NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   SEPTEMBER 30, 2013 AND 2012


NOTE 1 - ORGANIZATION AND NATURE OF BUSINESS OPERATIONS

Acquisition

Zoom Technologies, Inc. (the "Company") was incorporated in the state of Delaware on February 29, 2002. Until September 22, 2009, the
Company was engaged in the design, production, marketing, sales, and support of broadband and dial-up modems, Voice over Internet Protocol or "VoIP"
products and services, Bluetooth® wireless products, and other communication-related products.
On September 22, 2009, the Company consummated a share exchange transaction and acquired all the outstanding shares of Gold Lion Holding
Limited ("Gold Lion"), a company incorporated in the British Virgin Islands ("BVI"), and its subsidiaries Jiangsu Leimone Electronics Co. Ltd ("Jiangsu
Leimone"), Tianjin Tong Guang Group Digital Communication Co., Ltd ("TCB Digital") both incorporated in the (People's Republic of China, ("PRC"), and
Profit Harvest Corporation Limited ("Profit Harvest") incorporated in Hong Kong. In connection with the share exchange transaction, the Company spun off
its then-existing business to its stockholders, by distributing and transferring all assets and liabilities to its then subsidiary, Zoom Telephonics, Inc., and
issuing shares of its then operating subsidiary as a dividend to its stockholders. The subsidiaries of Gold Lion were engaged in the manufacture design,
sale and manufacture of mobile devices and handsets in China.
On June 1, 2010, Zoom pursuant to a share exchange agreement dated April 29, 2010, acquired 100% of the shares of Silver Tech Enterprises Ltd,
incorporated in the BVI and its wholly owned subsidiaries Ever Elite Corporation Limited, incorporated in Hong Kong, and Nollec Wireless Company Ltd.,
("Nollec Wireless"), incorporated in the PRC. Nollec Wireless is engaged in mobile phone and wireless communication device design.
On January 4, 2011, pursuant to a share exchange agreement, the Company via Profit Harvest acquired 100% ownership of Celestial Digital
Entertainment, Ltd., ("CDE") a mobile platform video game development company based in Hong Kong.
On October 11, 2011, the Company and Zoom USA Holdings, Inc., a newly formed wholly- owned subsidiary of the Company ("Zoom Sub") entered
into a Securities Purchase Agreement ("Securities Purchase Agreement") to purchase from The Cellular Network Communications Group, Inc. ("CNCG") a
50% interest in Portables Unlimited LLC ("Portables"), one of the largest wholesale distributors and direct retailers of T-Mobile products in the United
States. Subsequent to the purchase of the 50% stake in ownership from CNCG, the Company increased its stake in Portables to 50.1% by injecting
additional capital.
As of July 15, 2013, the Company was in default of the promissory note for $2,000,000 owed to Portables Unlimited, Inc.  The promissory note was
collateralized by the Company's ownership percentage in Portables.  As of the date of this report, the Company does not believe it is able to recover its
control and investment. As a result, Zoom ceased to have a controlling interest in Portables and did not retain an investment in it on the date of default,
July 15, 2013, accordingly, the Company deconsolidated Portables' financial statements and recognized a loss of approximately $7.44 million during the
quarter ended September 30, 2013 which includes a complete write off of its investment in Portables as of September 30, 2013. However, the Company
may decide pursue legal remedies in the future if the Company deems such as action as necessary.  The Company has reclassified all results of
operations related to Portables prior to the write off as discontinued operations.  Assets and liabilities related to Portables in comparative financial
statements have been reclassified to assets and liabilities of discontinued operations.

6Dispositions
On December 31, 2012, Zoom Technologies, Inc. ("Zoom" or the "Company") entered into a Share Purchase Agreement (the "SPA") with Beijing
Zhumu Culture Communication Company, Ltd. (the "Purchaser"), a PRC company that provides services to the telecommunication industry. Pursuant to
the SPA, the Company agreed to sell (the "Subsidiary Sale") to the Purchaser all the equity interests the Company holds in its China based subsidiaries
(except for SpreadZoom Technologies Co., Ltd. ("SpreadZoom") as mentioned below), which include 100% of the outstanding equity interest of Ever Elite
Corporation Limited, an intermediary holding company incorporated in Hong Kong, and its wholly owned subsidiary, Beijing Nollec Wireless Company
("Nollec"), 80% of the outstanding equity interest of Tianjin Tongguang Group Digital Communication Company, Ltd. ("TCBD"), 100% of the outstanding
equity interest of Profit Harvest Corporation, Ltd. ("Profit Harvest"), and 100% of the outstanding equity interest of Celestial Digital Entertainment, Ltd.
("CDE"). As consideration for the Subsidiary Sale, the Purchaser agreed to pay to the Company RMB 200 million (approximately US$31.7 million) (the
"Prepaid Price"), subject to adjustment pending an appraisal by an independent third party appraiser. The Company on October 24, 2012 received
approximately $12.6 million (RMB 80 million) less bank charges; the Company on November 5, 2012, received $19.1 million (RMB 120 million) less
transaction fees and bank charges. As of the date of this current report, the Purchaser has remitted the entire amount of RMB 200 million to the Company.
A portion of the funds, approximately RMB 80 million, was released to the Company to use; accordingly, in the normal course of business, the Company
deployed those funds to SpreadZoom and Tianjian Leimone as detailed in "Note 8 - Related Party Transactions".  The RMB 80 million released from
escrow was a negotiated amount between the Company and the Purchaser.  Upon the final closing of the Subsidiary Sale, which will occur 30 days after
the Company receives all the requisites corporate and regulatory approvals with respect to the Subsidiary Sale, the balance of the escrowed funds will be
released to the Company.
The Company's ownership interest in SpreadZoom, which owns and operates mobile phone manufacturing facilities in Tianjin, is not included in the
Subsidiary Sale.
The closing of the sale of Profit Harvest and CDE occurred on December 31, 2012; the closing of the sale of Ever Elite and Nollec occurred on April 5,
2013.  The Company has not completed the sale of TCB Digital as of the date of this report.  The Company is currently unable to set a definitive date to the
completion of the sale.  TCB Digital results of operations continue to be reported under discontinued operations.

As disclosed above, as of November 18, 2013, the Company has written off its investment in Portables Unlimited, LLC.

NOTE 2 - BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation
The Company's accompanying condensed consolidated balance sheet at September 30, 2012, include the accounts of Gold Lion Holding Ltd and
its wholly owned subsidiary Jiangsu Leimone, its 100%-owned subsidiary Silver Tech, and its specifically formed, wholly owned subsidiary, Zoom Sub.
The Company's condensed consolidated balance sheet also included the accounts of TCB Digital for which the Company owns 80% indirectly held through
Jiangsu Leimone which has been classified as discontinued operations held for sale.  Accounts related to Portables have not been included in the
September 30, 2013 condensed consolidated balance sheet.
The Company's accompanying condensed consolidated balance sheet at December 31, 2012, include the accounts of Gold Lion Holding Ltd and its
wholly owned subsidiary Jiangsu Leimone, its 100%-owned subsidiary Silver Tech, and its specifically formed, wholly owned subsidiary, Zoom Sub. The
Company's condensed consolidated balance sheet also included the accounts of TCB Digital for which the Company owns 80% indirectly held through
Jiangsu Leimone, 100% of Ever Elite which wholly owns Nollec Wireless, indirectly held through Silver Tech, all of which have been classified as
discontinued operations held for sale.  The accounts of Portables have been reclassified to discontinued operations.

7The Company's condensed consolidated results of operations for the three and nine months ended September 30, 2013 from continuing operations
included the results of Gold Lion, Silver Tech, Jiangsu Leimone, Zoom Sub; results of operations from Ever Elite and Nollec Wireless, up to the date of
their disposition, and TCB Digital have been presented as discontinued operations; the results of operations of Portables, up to June 30, 2013, which was
the last date when financial information was available, has been presented as discontinued operations.  The Company's condensed consolidated results of
operations for the three and nine months ended September 30, 2012 from continuing operations included the results of Gold Lion, Silver Tech, Jiangsu
Leimone, Zoom Sub; results of operations from Profit Harvest, CDE, Ever Elite, Nollec Wireless, TCB Digital, and Portables have been presented as
discontinued operations.
Equity Method Accounting
In May 2012, the Company invested $12.3 million to establish a joint venture named SpreadZoom Technologies Co. Ltd., ("SpreadZoom"). The
Company owns 47.4% of SpreadZoom and accounted for this investment under the equity method of accounting (ASC 323-30). Refer to "Note 15 - Equity
Method Investee: SpreadZoom" for details.
Exclusion of Related Party Lessor from Consolidation
Portables commencing in January 2009, subleased its principal facility from one of its noncontrolling member. The member began leasing the
facility in December 2005 from a related party, AUM Realty, LLC ("AUM"). The Company's management has assessed whether AUM should be
consolidated pursuant to FASB ASC 810 Consolidations. ASC 810 is not a "rules based" standard and thereby includes limited circumstances under which
it can be conclusively determined whether an entity should be consolidated. Management believes that AUM is not a variable interest entity ("VIE") as
defined in ASC 810 because AUM was adequately capitalized. Equity contributions from AUM's owners exceeded 20% of the acquisition costs of the
property. Management believes that this is, according to ASC 810 criteria, "sufficient to permit the entity to finance its activities without additional
subordinated financial support." Management believed that the same was true up to the July 15, 2013, when Portables ceased being consolidated in the
Company's books.
Based on this assessment, management believes that AUM is not a VIE because the Company does not make decisions that have significant impact
on the performance of AUM; therefore, it is not consolidated as a component of these consolidated financial statements. If the matter were to be assessed
differently, these consolidated financial statements would have included AUM's assets (principally land and building), liabilities (principally loan payable)
and expenses, with the excess of AUM's assets over liabilities shown as a "non-controlling interest". AUM guarantees $1.7 million of the $3 million line of
credit with M&T Bank for Portables Unlimited, LLC.
As result of the write off of the Company's investment in Portables, the Company will not perform analysis on a go forward basis, regarding the
exclusion of AUM as VIE for consolidation purposes.

Basis of Presentation
The condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United
States of America ("US GAAP"). The functional currency of the Company's continuing operation Jiangsu Leimone and its equity investment SpreadZoom is
the Chinese Renminbi ("RMB"). The functional currency of the Company's discontinued operations of Portables and Zoom Sub is United States Dollars
("USD" or "$"). The functional currency of the Company's discontinued operations, TCB Digital and Nollec Wireless is the RMB. The functional currency of
the Company's discontinued operations Ever Elite and CDE is Hong Kong Dollars ("HKD"). The accompanying consolidated financial statements are
translated and presented in the reporting currency of USD.
The interim condensed consolidated financial information as of September 30, 2013 and for the three and nine months ended September 30, 2013 and
2012 have been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"). Certain information
and footnote disclosures, which are normally included in annual consolidated financial statements prepared in accordance with U.S. GAAP, have been
omitted pursuant to those rules and regulations. The interim consolidated financial information should be read in conjunction with the financial statements
and the notes thereto, included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2012, previously filed with the SEC.

8In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present a fair statement of the Company's
consolidated financial position as of September 30, 2013, its consolidated results of operations for the three and nine months ended September 30, 2013
and 2012, and its consolidated cash flows for the nine months ended September 30, 2013 and 2012, as applicable, have been made. The interim results of
operations are not necessarily indicative of the operating results for the full fiscal year or any future periods.
Use of Estimates
The preparation of condensed consolidated financial statements in conformity with US GAAP requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the consolidated
financial statements and the amount of revenues and expenses during the reporting periods. Management makes these estimates using the best
information available at the time the estimates are made. However, actual results could differ materially from those results.
Risks and Uncertainties
The Company is subject to substantial risks from, among other things, intense competition associated with the industry in general, other risks
associated with financing, liquidity requirements, rapidly changing customer requirements, limited operating history, foreign currency exchange rates and
the volatility of public markets.
Comprehensive Income
The Company follows the provisions of ASC 220 "Reporting Comprehensive Income", establishes standards for the reporting and display of
comprehensive income, its components and accumulated balances in a full set of general purpose financial statements.
ASC 220 defines comprehensive income is comprised of net income and all changes to the statements of stockholders' equity, except those due to
investments by stockholders, changes in paid-in capital and distributions to stockholders, including adjustments to minimum pension liabilities,
accumulated foreign currency translation, and unrealized gains or losses on marketable securities.
Foreign Currency Translation and Transaction
The accounts of the Company's Chinese subsidiaries are maintained in the RMB and the accounts of the U.S. parent company are maintained in
the USD. The accounts of the Chinese subsidiaries were translated into USD in accordance with Financial Accounting Standards ("FASB") Accounting
Standards Codification ("ASC") Topic 810 with the RMB as the functional currency for the Chinese subsidiaries. According to ASC 810, all assets and
liabilities were translated at the exchange rate at the date of the balance sheet; stockholders' equity is translated at historical rates; the line items on the
statement of operations are translated at the weighted average exchange rate for the period. The resulting translation adjustments are reported under other
comprehensive income in accordance with FASB ASC Topic 220. Gains and losses resulting from the translations of foreign currency transactions and
balances are reflected in the income statement.
Cash and Equivalents
For Statement of Cash Flows purposes, the Company considers all cash on hand and in banks, including accounts in book overdraft positions,
certificates of deposit and other highly-liquid investments with maturities of three months or less, when purchased, to be cash and cash equivalents. The
Company maintains cash with various banks and trust companies located in China, Hong Kong and the United States. Cash accounts in China and Hong
Kong are not insured or otherwise protected. Should any bank or trust company holding cash deposits become insolvent, or if the Company is otherwise
unable to withdraw funds, the Company would lose the cash on deposit with that particular bank or trust company.


9Accounts Receivable
The Company maintains reserves for potential credit losses on accounts receivable. Management reviews the composition of accounts receivable
and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment
patterns to evaluate the adequacy of these reserves.  Accounts are written off against the allowance when it becomes
evident collection will not occur. For the contracted manufacturing activities, our standard terms for accounts receivable from our customers are between
60 to 75 days from close of the billing cycle; and for sales of own brand phones our terms include prepaid arrangements and extending receivable to
customers up to 60 days. We also offer credit terms of up to 150 days in our trading activities to a certain customers. As of September 30, 2013,
management concluded that the allowance for doubtful accounts, as disclosed in "Note 5 - Accounts Receivable" was adequate to cover any potential
unrecoverable balances as a result of delinquency.
Inventories
Inventories are stated at the lower of cost or market. Cost is determined on a weighted average basis and includes all expenditures incurred in
bringing the goods to the point of sale and putting them in a saleable condition. In assessing the ultimate realization of inventories, the management makes
judgments as to future demand requirements compared to current or committed inventory levels. Our reserve requirements generally increase as our
projected demand requires; or decrease due to market conditions and product life cycle changes. The Company estimates the demand requirements
based on market conditions, forecasts prepared by its customers, sales contracts and orders in hand.
In addition, the Company estimates net realizable value based on intended use, current market value and inventory ageing analyses. The Company
writes down inventories for estimated obsolescence or unmarketable inventory equal to the difference between the cost of inventories and their estimated
market value based upon assumptions about future demand and market conditions.
Property, Plant and Equipment
Property, plant and equipment are recorded at cost. Gains or losses on disposals are reflected as gain or loss in the year of disposal. All ordinary
repair and maintenance costs are expensed as incurred. Expenditures for maintenance and repairs are expensed as incurred. Major renewals and
betterments are charged to the property accounts while replacements, maintenance and repairs, which do not improve or extend the lives of the respective
assets, are expensed in the current period.
Depreciation for financial reporting purposes is provided using the straight-line method over the estimated useful lives of assets.
Capitalized Interest
Interest associated with major development and construction projects is capitalized and included in the cost of the project. When no debt is
incurred specifically for a project, interest is capitalized on amounts expended on the project using weighted-average cost of the Company's outstanding
borrowings. Capitalization of interest ceases when the project is substantially complete or development activity is suspended for more than a brief period.
There have not been material amounts of capitalized interest for the three and nine months ended September 30, 2013.

10Impairment of Long-lived Assets
In accordance with ASC 360, "Property, Plant and Equipment", the Company reviews the carrying values of long-lived assets, including property,
plant and equipment and other intangible assets, whenever facts and circumstances indicate that the assets may be impaired. Recoverability of assets to
be held and used is measured by a comparison of the carrying amount of an asset to future net undiscounted cash flows expected to be generated by the
asset. If an asset is considered impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds
the fair value. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less costs of disposal. The Company last performed
annual reviews of its long-lived assets at December 31, 2012 and 2011. In 2012, the Company determined that certain fixed assets and goodwill were
impaired based on the disposal of certain operations. The Company has determined there have been triggering events during the nine months ended
September 30, 2013 that would require he Company to perform review for impairment of its long lived assets, such as the default of the promissory note to
Portables Unlimited, Inc.; accordingly, the Company has written off its investment in Portables.  Except for the assets and investments that have already
been written down, the Company believes it remaining long lived assets for continuing operations is fairly stated.
Goodwill
The Company recognizes goodwill for the excess of the purchase price over the fair value of the identifiable net assets of the business acquired.
ASC 350 "Intangible Assets-Goodwill and Other", an impairment test for goodwill is undertaken by the Company at the reporting unit level annually, or
more frequently if events or changes in circumstances indicate that goodwill might be impaired. The Company recorded impairment of goodwill related to
the following subsidiaries: Jiangsu Leimone, CDE, Silver Tech, and Portables. See "Note 3 - Merger and Acquisitions" for details.
Revenue Recognition
The Company recognizes sales in accordance with FASB ASC Topic 605, "Revenue Recognition."
The Company recognizes revenue when the following criteria are met:
(i) persuasive evidence of an arrangement exists;
(ii) delivery has occurred or services were rendered;
(iii) the price to the customer is fixed or determinable and,
(iv) collection of the resulting receivable is reasonably assured. Revenue is not recognized until title and risk of loss is transferred to the customer,
which occurs upon delivery of goods, and objective evidence exists that customer acceptance provisions were met.
The Company bases its estimates on historical experience taking into consideration the type of products sold, the type of customer, and the type of
specific transaction in each arrangement. Revenues represent the invoiced value of goods, net of value added tax ("VAT").
The Company does not offer promotional payments, customer coupons, rebates or other cash redemption offers to its customers. Deposits or advance
payments from customers prior to delivery of goods and passage of title of goods are recorded as advanced from customers.

11The Company's discontinued operation, Nollec Wireless is in the mobile phone design, software integration and mobile solution R&D business,
Nollec Wireless, recognizes revenue under the percentage of completion method ASC Topic 605- 35-25 (Construction - Type and Production - Type
Contracts) when reasonably dependable estimates can be made and all the following conditions exist:
Contracts executed by the parties normally include provisions that clearly specify the enforceable rights regarding goods or services to be provided
and received by the parties, the consideration to be exchanged, and the manner and terms of settlement.
The buyer can be expected to satisfy all obligations under the contract.
The contractor can be expected to perform all contractual obligations.Estimates of cost to complete is reviewed periodically and revised as appropriate to reflect new information. When the current estimates of total
contract revenue and contract cost indicate a loss, a provision for the entire loss on the contract is made.
Income is recognized as the percentage of estimated total income, and is determined by dividing incurred costs to date by estimated total costs after
giving effect to adjustments, if any, in estimates of costs to completion based upon the most recent information. Percentage of completion is based on labor
hours incurred to date divided by total estimated labor hours for the contract.
Royalty income on sales of licensed products by its customers is recorded when the customers report sales to the Company. Royalty income is
reported monthly and recorded in the period in which the product is sold. The Company has the right to audit the books of the licensees.
The Company's discontinued operation CDE is in the business of video games and applications for mobile phones and mobile platforms development.
Revenue is recognized in accordance with ASC 985-605-55-125. Cost of Software Development Revenue is accounted for under ASC 985-20 to be sold,
leased or otherwise marketed.
CDE capitalizes cost of development of software for hosting purpose in accordance with ASC subtopic 350-40 ("ASC 350-40"), Intangibles-Goodwill
and Other: Internal-Use. As such, CDE expenses all costs that are incurred in connection with the planning and implementation phases of development
and costs that are associated with repair or maintenance. Costs incurred in the development phase are capitalized and amortized over the estimated
product life. Since the inception of CDE, the amount of costs qualifying for capitalization has been insignificant and as a result all internally used software
development costs have been expensed as incurred.
The Company's subsidiary, Portables is in the business of distribution of mobile phone and provision of wireless service. Revenue from the sale of
equipment is recognized upon shipment or when purchased at Portables retail locations. Commission income is recognized upon activation of wireless
communication services with T-Mobile.
Income Taxes
The Company accounts for income taxes in accordance with ASC 740 "Income Taxes", previously SFAS No. 109. Under this method, deferred
income taxes are recognized for the estimated tax consequences in future years of differences between the tax bases of assets and liabilities and their
financial reporting amounts and each year-end based on enacted tax laws and statutory rates applicable to the periods in which the differences are
expected to affect taxable income. Valuation allowances are established to reduce deferred tax assets to the amount expected to be realized when, in
management's opinion; it is more likely than not that some portion of the deferred tax assets will not be realized. The provision for income taxes represents
current taxes payable net of the change during the period in deferred tax assets and liabilities.

12Uncertain Tax Positions
The Company accounts for uncertainty in income taxes using a two-step approach to recognizing and measuring uncertain tax positions. The first
step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position
will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest
amount that is more than 50% likely of being realized upon settlement. The Company classifies the liability for unrecognized tax benefits as current to the
extent that the Company anticipates payment (or receipt) of cash within one year. Interest and penalties related to uncertain tax positions are recognized
and recorded as necessary in the provision for income taxes. There were no uncertain tax positions in 2012 and 2011. The Company's evaluation of
uncertain tax positions was performed for the tax years ended December 31, 2009 and forward, the tax years which remain subject to examination as of
September 30, 2013.
Operating Leases
Leases where substantially all the rewards and risks of ownership of assets remain with the leasing company that do not meet the capitalization
criteria of ASC 840 "Leases", are accounted for as operating leases. Rental payables under operating leases are expensed on the straight-line basis over
the lease term.
Research and Development Costs
Research and development costs are related primarily to the development of cell phone technology, video games and applications for mobile
phones and mobile platforms development. Research and development costs are expensed as incurred.
Earnings (Loss) Per Share
The Company reports earnings (loss) per share in accordance with the provisions of ASC 260 "Earnings Per Share". ASC 260 requires
presentation of basic and diluted earnings per share in conjunction with the disclosure of the methodology used in computing such earnings per share.
Basic earnings per share excludes dilution and is computed by dividing income available to common stockholders by the weighted average common
shares outstanding during the period. Diluted earnings per share takes into account the potential dilution that could occur if securities or other contracts to
issue common stock were exercised and converted into common stock using the treasury method.
Common stock equivalents represent the dilutive effect of the assumed exercise of the outstanding stock options and warrants, using the treasury
stock method, at either the beginning of the respective period presented or the date of issuance, whichever is later, and only if the common stock
equivalents are considered dilutive based upon the Company's net income (loss) position at the calculation dates. When the Company's results from
operations are a net loss, dilutive securities are not included in diluted loss per share because they would be considered anti-dilutive.
Fair Values of Financial Instruments
ASC 820 "Fair Value Measurements and Disclosures", defines fair value, establishes a three-level valuation hierarchy for disclosures of fair value
measurement and enhances disclosure requirements for fair value measures. The carrying amounts reported in the balance sheets for current receivables
and payables qualify as financial instruments. Management concluded the carrying values are a reasonable estimate of fair value because of the short
period of time between the origination of such instruments and their expected realization and if applicable, their stated interest rate approximates current
rates available. The three levels are defined as follows:

Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for
the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments.13Level 3 inputs to the valuation methodology are unobservable and significant to the fair value.The assets measured at fair value on a recurring basis subject to the disclosure requirements of ASC 820 as of September 30, 2013 and December
31, 2012 are as follows:

SignificantActive Markets


Other


SignificantCarrying


for Identical


Observable


UnobservableValue


Assets


Inputs


Inputs2013


(Level 1)


(Level 2)


(Level 3)Cash and cash equivalents

$
1,818,816

$
1,818,816

$
-

$
-Restricted cash

$
19,555,440

$
19,555,440

$
-

$
-Warrants

$
-

$
-

$
-

$
-SignificantActive Markets


Other


SignificantCarrying


for Identical


Observable


UnobservableValue


Assets


Inputs


Inputs2012


(Level 1)


(Level 2)


(Level 3)Cash and cash equivalents

$
8,351

$
8,351

$
-

$
-Restricted cash

$
19,044,294

$
19,044,294

$
-

$
-Warrants

$
7,340

$
-

$
7,340

$
-The Company's financial instruments include cash and equivalents, restricted cash, accounts receivable, notes receivables, other receivables,
accounts payable, notes payable, and warrants. Cash and cash equivalents consist primarily of high rated money market funds at a variety of well-known
institutions with original maturities of three months or less. Restricted cash represents time deposits on account to secure short-term bank loans and notes
payable. Management estimates the carrying amounts of the non-related party financial instruments approximate their fair values due to their short-term
nature.
Concentration of Credit Risk
Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and equivalents
and trade and bills receivables. As of September 30, 2013 and December 31, 2012, substantially all of the Company's cash and equivalents and restricted
cash were held by major financial institutions located in the PRC, Hong Kong and the United States, which management believes are of high credit quality.
With respect to trade and notes receivables, the Company extends credit based on an evaluation of the customer's financial condition. The Company
generally does not require collateral for trade receivables and maintains an allowance for doubtful accounts of trade receivables.
Notes receivable are undertaken by the banks to honor the payments at maturity and the customers are required to place deposits with the banks
equivalent to certain percentage of the notes amount as collateral. These notes receivable can be sold to any third party at a discount before maturity. The
Company does not maintain an allowance for notes receivable in the absence of bad debt experience and the payments are undertaken by the banks.
Non-controlling Interests
The Company follows ASC 810 for reporting non-controlling interest ("NCI") in a subsidiary. As a result, the Company reports NCI as a separate
component of Equity in the Consolidated Balance Sheet. Additionally, the Company reports the portion of net income and comprehensive income attributed
to the Company and NCI separately in the Consolidated Statement of Income.

14Statement of Cash Flows
In accordance with ASC 230, "Statement of Cash Flows", cash flows from the Company's operations are calculated based upon the local
currencies. As a result, amounts related to assets and liabilities reported on the statement of cash flows may not necessarily agree with changes in the
corresponding balances on the balance sheet.
Recent Accounting Pronouncements
In February 2013, the Financial Accounting Standards Board ("FASB") issued amendments under ASU No. 2013-02, Reporting of Amounts
Reclassified Out of Accumulated Other Comprehensive Income (Topic 220). The amendments require an entity to provide information about the amounts
reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement
where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line
items of net income, but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting
period. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income, an entity is required to
cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. The Company will adopt these
amendments in the fourth quarter of 2013.
In March 2013, the FASB issued guidance on a parent's accounting for the cumulative translation adjustment upon derecognition of a subsidiary or
group of assets within a foreign entity. This new guidance requires that the parent release any related cumulative translation adjustment into net income
only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had
resided. The Company will adopt these amendments in 2014.  The Company has not yet determined if there will be material impacts on its financial
statements upon adoption.

NOTE 3 - MERGER AND ACQUISITIONS
The Company acquired 100% equity in Silver Tech on May 31, 2010. As of May 31, 2010, the net assets of Silver Tech were $2,564,160.
The purchase consideration was $10,960,000 which resulted in goodwill of $8,395,840. As of December 31, 2012, the Company has taken action to
dispose of Silver Tech's operating subsidiaries Ever Elite and Nollec; accordingly, all goodwill related to Silver Tech has been written off.
The Company acquired 100% ownership of CDE on January 4, 2011. As of January 4, 2011, the net liabilities of CDE were $43,409. The purchase
consideration was $1,818,000 which resulted in goodwill of $1,861,409. As of December 31, 2012, as part of the Company's disposal of Profit Harvest the
Company has indirectly disposed of CDE, accordingly, all of the goodwill related to CDE has been written off.
The Company acquired 55% ownership of Portables on October 11, 2011. As of October 11, 2011, Portables' liabilities exceeded its assets by
$9,290,241. The purchase consideration was $9,851,486 which resulted in goodwill of $27,005,953. The Company acquired Portables for two reasons; (a)
to diversify its revenue sources, and (b) to gain access to the most mature mobile handset market in the world. The Company's ownership in Portables had
been reduced to 50.1% as of December 31, 2012.  At July 15, 2013, the Company was in default of a loan with Portables Unlimited, Inc. and during the
three months ended September 30, 2013, the Company decided to write down its investment in Portables.  See "Note 1 - Organization and Nature of
Business Operations - Dispositions", for further details.

15The following table summarizes goodwill as of September 30, 2013 and December 31, 2012 resulting from the acquisitions of Jiangsu Leimone, Silver Tech, and CDE:

September 30,


December 31,2013


2012(Unaudited)Jiangsu Leimone

$
103,057

$
103,057Silver Tech


8,395,840


8,395,840CDE


1,861,409


1,861,409Portables


27,031,492


27,031,492Total


37,391,798


37,391,798Less: Impairment


(37,391,798)


(37,391,798)Total goodwill

$
-

$
-NOTE 4 - RESTRICTED CASH
Restricted cash was part of the funds deposited with the Company for sale to Beijing Zhumu Culture Communication Company, Ltd. of Profit
Harvest, CDE, Ever Elite, Nollec Wireless, and TCB Digital. The funds become unrestricted upon closing of the disposition transaction.  The funds are in
held in account dually controlled by the Company and Beijing Zhumu Culture Communication Company, Ltd.

NOTE 5 - OTHER RECEIVABLES AND PREPAID EXPENSES
As of September 30, 2013 and December 31, 2012, the Company's other receivables and prepaid expenses consisted of the following:

September 30,


December 31,2013


2012(Unaudited)Deposit

$


$
90,091Prepaid expenses


191,750


-Others


1,025,691


3,899,271Total other receivables and prepaid expenses

$
1,217,441

$
3,989,362The balances of $1,205,691 and $3,899,271 labeled as "Others" as of September 30, 2013 and December 31, 2012 were receivables owed to the
Company by Profit Harvest that arose in the normal course of business where the Company paid for expenses and professional fees on behalf of Profit
Harvest. Profit Harvest was previously a subsidiary of the Company. In 2012, it was sold to Beijing Zhumu Culture Communication Company, Ltd. These
amounts are expected to be recovered by the Company.

16NOTE 6 - INTANGIBLE ASSETS
As of September 30, 2013 and December 31, 2012, the Company's intangible assets were summarized as follows:

Estimated


September 30,


December 31,Useful Life


2013


2012(Unaudited)Domain name, logo and trade mark

Indefinite

$
349,600

$
349,600Total cost




349,600


349,600less: Accumulated amortization




-


-Intangible assets,net



$
349,600

$
349,600Intangible assets are stated at cost less accumulated amortization. The Company acquired domain name "zoom.com" and related logo and trade
name for 80,000 shares of common stock valued $349,600 as of the date of purchase. The domain name, logo and trademark have indefinite lives and no
amortization was recorded.

NOTE 7 - NOTES PAYABLE

There was note issued to CNCG as part of the Company acquisition of Portables, with an original face amount of $500,000, term from
October 11, 2011 to October 11, 2014, and annual interest rate of 2.0%.  The outstanding balance of the note is $205,937.  As of November 25, 2013, the
note is in default.

The Company issued a note for $870,000 on or about June 1, 2010 to the prior shareholders of Nollec Wireless as part of the acquisition consideration
for Nollec Wireless.  The outstanding balance of the note is $145,000 as of September 30, 2013; the note carries an interest rate 6% per annum.  As of
November 25, 2013, the note is in default.

NOTE 8 - RELATED PARTY TRANSACTIONS
Due from related parties

As of September 30, 2013 and December 31, 2012, due from related parties were:

September 30,


December 31,Due from related parties


2013


2012(Unaudited)Beijing Leimone Shengtong Wireless Technology Co., Ltd.

$
35,852

$
91,571Leimone (Tianjin) Industrial Co., Ltd.


4,212,356


11,034,982Shenzhen Leimone


324,950


355,564Spreadzoom


9,046,040


9,046,038Total due from related parties

$
13,619,198

$
20,528,155Beijing Leimone Shengtong Wireless Technology Co., Ltd. ("Beijing Leimone") was founded by Gu, the largest shareholder of the Company. Beijing
Leimone borrows money from the Company. The borrowings bore no interest and had a maturity of 12 months. The balances are neither collateralized nor
personally guaranteed by Gu.  The balance is expected to be repaid in full by December 31, 2013.

17Leimone (Tianjin) Industrial Co., Ltd. ("Tianjin Leimone") was controlled by Gu, the largest shareholder of the Company. Tianjin Leimone sells raw
materials to the Company. As of September 30, 2013 and December 31, 2012, the amounts due from Tianjin Leimone of $4,212,356 and $11,034,982
represented advances for purchases arising in the normal course of business for transactions prior to December 31, 2012. The difference in balances
between September 30, 2013 and December 31, 2012, represents the repayment of related party advances.  The outstanding balance is expected to begin
to reduce materially when the Company has completed its sale of TCB Digital.
Shenzhen Leimone Company, Ltd., formed by individuals including our Chairman, Mr. Gu, is set up with the intention of providing manufacturing
services to our Company particularly for exports. $324,950 and $355,564 as of September 30, 2013 and December 31, 2012 was a loan to Shenzhen
Leimone for setup costs.  The balance is expected to be repaid in full by December 31, 2013.
The balance due from SpreadZoom represents an advance to SpreadZoom for it to purchase components to manufacture handsets in the normal
course of business. The advance bears no interest, and is uncollateralized. The difference in balances between September 30, 2013 and December 31,
2012, represents the fluctuation of exchange rates between the functional and reporting currency. Such advances occurred during the early stages of the
business.  The SpreadZoom has not yet been fully capitalized.  Upon completion of the sale of TCB Digital, the Company expects to be repaid these
advances.

Due to related parties
As of September 30, 2013 and December 31, 2012, due to related parties were:

September 30,


December 31,Due to related parties


2013


2012(Unaudited)Mr. Lei Gu

$
2,863,500

$
2,901,283Anthony Chan


-


358,814Beijing Leimone Shengtong Cultural Development Co., Ltd.


102,500


102,500Portables Unlimited, Inc.


-


2,000,000Total due to related parties

$
2,966,000

$
5,362,597Mr. Gu provides funds to the Company with no interest and are due on demand. As of September 30, 2013 and December 31, 2012, the balances of funds
provided by Gu was $2,863,500 and $2,901,283 respectively.

At December 31, 2012, the Company owed to Mr. Anthony Chan certain accrued compensation for services rendered in the amount of $358,814.  As
of September 30, 2013, the balance owed to Mr. Chan has been fully settled.

At December 31, 2012, the Company owed to Portables Unlimited, Inc. a promissory note for $2,000,000. As of July 15, 2013, the
Company was in default of this note. Refer to "Note 1 - Organization and Nature of Business Operations" for further details.


NOTE 9 - STOCKHOLDERS' EQUITY
COMMON STOCK

On July 16, 2013, the Company issued 56,000 shares as compensation to Mr. Anthony Chan for back pay.  The Company recorded $280,000 of
compensation expense.

On November 12, 2013, the Company effectuated a 10 for 1 reverse split of its common stock.  All share numbers and per share amounts have been retroactively restated to
reflect the reverse split.

18NOTE 10 - WARRANTS
The Company granted Series A, B, C, D and E warrants to the accredited investors as part of its private placement offering on October 16,
2009 and November 18, 2009.
Following is the brief description of warrants:
Series A Warrants: The Series A warrants have an exercise price of $60.00 and a term of 5 years from the issue date subject to the Exchange
Cap (as defined in the agreement).
Series B Warrants: The Series B warrants have an exercise price of $0.10 and a term of three (3) months from the issue date
provided, however, that such date shall be extended indefinitely if the warrant cannot be exercised due to the Beneficial Ownership
Limitation (as defined in the agreement) or the Exchange Cap Limitation (as defined in the agreement) until the warrant can be exercised in full by the
holder thereof without breaching the Beneficial Ownership Limitation (as defined in the agreement) or the Exchange Cap Limitation (as defined in the
agreement). All B Warrants were exercised in December 2009.
Series C Warrants: The Series C warrants shall be exercisable only upon the exercise of the Series B warrants. The Series C warrants shall
have an exercise price of $60.00 and a term of 5 years from the issue date.
Series D Warrants: The Series D warrants shall be exercisable if the Company fails to meet certain performance criteria for the year 2009.
The Series D warrant shall have an exercise price of $0.10 and a term of exercise equal to three (3) months from the date the Maximum Eligibility Date (as
defined in the agreement); provided, however, that such date shall be extended indefinitely if the warrant cannot be exercised due to the Beneficial
Ownership Limitation (as defined in the agreement) or the Exchange Cap (as defined in the agreement) until the warrant can be exercised in full by the
holder without breaching the Beneficial Ownership Limitation (as defined in the agreement) or the Exchange Cap Limitation (as defined in the agreement).
Due to the Net Income of Zoom as reported in the Company's annual report for the year 2009 exceeding the eligibility threshold pursuant to the agreement,
the Series D Warrants became ineligible for exercise.
Series E Warrants: The Series E warrants shall be exercisable if the Company fails to meet certain performance criteria for the year 2010.
The Series E warrants shall have an exercise price of $0.10 and a term of three (3) months from the date the Maximum Eligibility Date (as defined in the
agreement); provided, however, that such date shall be extended indefinitely if the warrant cannot be exercised due to the Beneficial Ownership Limitation
(as defined in the agreement) until the Warrant can be exercised in full by the holder thereof without breaching the Beneficial Ownership Limitation (as
defined in the agreement). Due to the Net Income of Zoom as reported in the Company's annual report for the year 2010 exceeding the eligibility threshold
pursuant to the agreement, the Series E Warrants became ineligible for exercise.
The Company granted on May 6, 2010, Series F warrants to the above investors for their temporary forfeiture of their right to participate in the
Company's future financings.

Series F Warrants: The Series F warrants have an exercise price of $60.00 and a term of 5 years from the issue date. The Company issued
37,500 Series F warrants to investors who participated in private placement transaction pursuant to the Securities Purchase Agreement dated October
15, 2009, to temporarily waive their right for a period of eight months to participate in a future offering of the Company. The investors originally have a
period of twenty-four months ("Rights Period") in which they have the right to participate, and for providing a temporary waiver, an eight-month duration is
added to the original expiration of the Rights Period.

The Company granted Series G warrants to the accredited investors as part of its private place offering on November 15, 2010.

19Series G Warrants: The Series G warrants shall have an exercise price of $47.10 and a term of 5 years from the issue date.
Anti-dilution Adjustments for Certain Warrants: Since the private placement in November 2010 involved sales of the Company's stock at a price that
activated anti-dilution provisions in the Series A, C, F and certain placement agent warrants, the exercise price of these warrants is adjusted to $37.40 per
share and the number of warrants eligible is multiplied by a factor of 60 / 37.40 or 1.60 with fractional shares rounding up.

The following summary represents warrants activity during the three months ended September 30, 2013:

Weighted-Average


AggregateNumber of


Exercise


IntrinsicWarrants


Price


ValueBalance, December 31, 2012

863,860

$
23.00

$
-Granted

-


-Lapsed

-


-Exercised

-


-Cancelled

-


-Balance, September 30, 2013

863,860

$
23.00

$
-The following presents warrants summary as of September 30, 2013:

Warrants Outstanding

Warrants ExercisableWeighted-


Weighted-




Weighted-Average


Average




AverageNumber


Remaining


Exercise

Number


ExerciseOutstanding


Contractual Life


Price

Exercisable


PriceWarrants

863,860


1.35 years

$
23.00

863,860

$
23.00The Company has accounted for all of the outstanding Series A, C, F, G, and related placement warrants as liabilities. The Company assessed the
value of these warrants by using the binomial lattice model. When the Company valued the warrants it used the following assumptions as part of inputs into
the valuation model. US treasury rates as measure of the risk free rate of return. The Company also used the mean of the annualized standard deviation of
the log normal returns of comparable companies in the same line of business as measure of volatility. The Company controls whether dilution may occur,
so it did not add additional assumptions regarding dilutive events into the future discrete outcomes found in the model. The warrants values were adjusted
for the dilutive effect as ratio of the outstanding common stock at the time of measurement. In determining the probabilities of an up movement or down
movement in the discrete outcomes, as well as the related magnitude of such up or down movements, the Company used a Cox-Ross-Rubenstein
approach in applying the binomial lattice model.

NOTE 11 - STOCK OPTIONS
The 2009 Equity Incentive Compensation Plan
On October 11, 2011, the Company's BOD approved of the granting of 150,000 options to employees and executives of Portables Unlimited
LLC, the Company's newly acquired subsidiary, with the exercise prices of $18.30 and $37.50 per share, with 25% of the options vesting immediately and the
balance equally per quarter over three years. These options expire in four years.

On October 8, 2012, the Company's BOD approved of the re-pricing of 120,000 out of the above-mentioned 150,000 options from the exercise
price of $37.50 to $18.30 per share.

20On October 26, 2011, the Company's BOD approved of the granting of 1,000 options to its new independent director, with the exercise price of $20.40
per share, vesting over one year and expiring in two years.
On November 29, 2011, the Company's BOD approved of the granting of 30,000 options to a consultant, with the exercise price of $10.00 per share,
with 1/3 vesting immediately and the balance equally over two quarters. These options expire in two years.

On May 22, 2012, the Company issued 30,280 shares of its common stock to its employees, and directors in replacement for cancelling 133,900
outstanding options that were held by the same recipients. The shares have the same vesting schedule as the options and were valued at $11.20 per share,
the closing price on the date of Board Approval, which is considered the market price at that time. Based on the difference between the market value of the
shares and the Black-Scholes value of the cancelled options as of May 22, 2012, there was no extra non-cash compensation expense for the three months
ended September 30, 2013.

The following summary represents options activity during the nine months ended September 30, 2013 under the New Plan.

Weighted-Under


Average


AggregateNew


Exercise


IntrinsicPlan


Price


ValueBalance, December 31, 2012

181,000

$
16.90

$
-Granted

10,000


6.50Lapsed

-


-Exercised

-


-Cancelled

-


-Balance, September 30, 2013

191,000

$
16.40

$
-The following represents options summary as of September 30, 2013 under the New Plan.

Options Outstanding

Options ExercisableWeighted-


Weighted-




Weighted-Average


Average




AverageNumber


Remaining


Exercise

Number


ExerciseOutstanding


Contractual Life


Price

Exercisable


PriceOptions

191,000


1.80 years

$
16.40

107,944

$
15.90For the re-pricing of the 120,000 options on October 8, 2012, from the exercise price of $37.50 to $18.30 per share, the Company determined the
incremental fair value of $0.58 per share which was calculated by taking the difference between the Black Scholes values of the new exercise price and
that of the old exercise price. Other data used in the calculations include: the stock market price of $9.00, expected life of 3 years, volatility of 39.22% and
discount rate of 0.35%.
On November 29, 2011, the Company's BOD approved of the granting of 30,000 options to a consultant, with the exercise price of $10.00 per share,
with 1/3 vesting immediately and the balance equally over two quarters. These options expire in two years.
On February 14, 2013, the Company's BOD approved of the granting of 10,000 options to an employee with an exercise price of $6.50, with monthly
vesting beginning in February 2013. The options expire four years from the date of grant. The Company determined the grant date fair value of 10,000
options of $1.70 per share which was calculated using the Black Scholes Options Pricing Model as follows: Stock price of $6.50 per share, exercise price
of $6.50 per share, expected life of 4.00 years, volatility of 32.48% and discount rate of 0.64%.

21The Company recorded $3,817 of non-cash compensation expense related to stock options for the three months ended September 30, 2013. As of
September 30, 2013, there was $35,296 of non-cash compensation to be recorded up to 2014 based on options valued at grant date.

NOTE 12 - INCOME TAX
The Company is subject to income taxes by entity on income arising in or derived from the tax jurisdiction in which each entity is domiciled.
Zoom Technologies Inc., the parent company was incorporated in the U.S. and has net operating losses ("NOL") for income tax purposes, which can
be carried forward for up to 20 years from the year the loss is incurred. Zoom has NOL carry forwards for income taxes of approximately $1.97 million and
$1.38 million at September 30, 2013 and December 31, 2012, which may be available to reduce future years' taxable income. Management believes the
realization of benefits from these losses remains uncertain due to Zoom's limited operating history and continuing losses. Accordingly, a 100% deferred tax
asset valuation allowance has been provided.

The discontinued operations of TCB Digital and Nollec Wireless, and the continuing operation of Jiangsu Leimone are governed by the Income Tax
Law of the PRC concerning the private-run enterprises, which are generally subject to tax at a statutory rate of 25% on income reported in the statutory
financial statements after appropriate tax adjustments.
Jiangsu Leimone is exempt from income tax in PRC for two years starting from the first profitable year or the year 2008, whichever is earlier, and is
subject to a 50% exemption on normal income tax rate for the following three years.  2012, is the last year that Jiangsu Leimone will afforded the
50% exemption from PRC incomes taxes.
SpreadZoom in subject to the Income Tax Law of the PRC concerning the private-run enterprises, which are generally subject to tax at a statutory rate
of 25% on profit that is reported in the statutory financial statements after appropriate tax adjustments.
Nollec Wireless is exempt from income tax in PRC for two years starting from 2008, and is subject to a 50% exemption on normal income tax rate for
three years starting from 2010 and is subject to normal income tax rate from 2013.
Nollec had pre-tax loss for the nine months ended September 30, 2013. The Company's net income and earnings per share had no effect due to its
income tax exemption.
The discontinued and disposed operations Profit Harvest and CDE are governed by the Income Tax Law of Hong Kong, which is generally subject to
tax at a statutory rate of 16.5% on income reported in the statutory financial statements after appropriate tax adjustments.
Portables is governed by the Income Tax Law of United States; however, because Portables is a pass through entity for tax purposes, tax liabilities are
the responsibility of its members. Therefore, Zoom Sub, which is responsible to report and make payments on its portion of income generated by Portables
is subject to a graduated statutory tax rate of 34%.
U.S. NOL carryforwards are only those arising after September 22, 2009, which was the date when a more-than-50% ownership change occurred.

22The following table summarizes the temporary differences which result in deferred tax assets and liabilities as at September 30, 2013 and December 31, 2012:

September 30,


December 31,2013


2012Deferred tax assets:


(Unaudited)Net operating loss

$
466,275

$
511,035less: Valuation allowance


(466,275)


(511,035)Total deferred tax assets


-


-Deferred tax liabilities:


-


-Deferred tax assets, net

$
-

$
-The following table reconciles the U.S. statutory rates to the Company's effective tax rates for the three and nine months ended September 30, 2013 and 2012:

Three Months Ended

Nine  Months EndedSeptember 30,

September 30,2013

2012

2013

2012US statutory rates

34.00%

34.00%

34.00%

34.00%Tax rate difference

3.24%

-5.51%

-1.20%

-2.05%Valuation allowance

-37.24%

-28.49%

-32.80%

-31.95%State taxes

0.00%

-1.42%

-5.57%

-0.40%Tax per financial statements

0.00%

-1.42%

-5.57%

-0.40%NOTE 13 - STATUTORY RESERVES
As stipulated by the Company Law of the PRC, net income after taxation can only be distributed as dividends after appropriation has been
made for the following:
i) Making up cumulative prior years' losses, if any;
ii) Allocations to the "Statutory surplus reserve" of at least 10% of income after tax, as determined under PRC accounting rules and regulations, until
the fund amounts to 50% of the Company's registered capital;
iii) Allocations of 5-10% of income after tax, as determined under PRC accounting rules and regulations, to the Company's "Statutory common welfare
fund", which is established for the purpose of providing employee facilities and other collective benefits to the Company's employees; and Statutory
common welfare fund is no longer required per the new cooperation law executed in 2006.
iv) Allocations to the discretionary surplus reserve, if approved in the shareholders' general meeting.

As of September 30, 2013 and December 31, 2012, the Company's statutory surplus reserve was $737,623 and $702,539 respectively.

23NOTE 14 - OPERATING RISK

Industry riskThe industry in which we compete is a rapidly evolving, highly competitive and fragmented market driven by consumer preferences and
quickly evolving technology. Increased competition may result in price reductions, reduced gross margin and loss of market share. Failure to compete
successfully against current or future competitors could have a material adverse effect on the Company's business, operating results and financial
condition.

Exchange riskThe Company cannot guarantee the Renminbi and USD exchange rate will remain steady; therefore, the Company could post the same profit
for two comparable periods and post higher or lower profit depending on exchange rate of Renminbi and USD. The exchange rate could fluctuate
depending on changes in the political and economic environments without s

Political riskCurrently, PRC is in a period of growth and is openly promoting business development in order to bring more business into PRC. Additionally
PRC currently allows a Chinese corporation to be owned by a United States corporation. If the laws or regulations relating to ownership of a Chinese
corporation are changed by the PRC government, the Company's ability to operate the PRC subsidiaries could be affected.

Interest riskThe Company is exposed to interest rate risk arising from short-term variable rate borrowings from time to time. The Company's future
interest expense will fluctuate in line with any change in borrowing rates.
The Company had outstanding warrants that are accounted for as derivative securities. Their values are re-measured at each reporting period. The
quoted U.S. treasury rates with the maturities similar to those of the warrants are used as inputs in calculating their value; accordingly, the value of the
warrants, are subject to fluctuations interest rates.

NOTE 15 - EQUITY METHOD INVESTEE: SPREADZOOM
On May 10, 2012, the Company along with Spreadtrum Communications (Tianjin) Co., Ltd, Tianjin Baoshui District Investment Co, Ltd, and
Han & Qin International (BVI) Limited invested in the joint venture SpreadZoom Technologies, Inc ("SpreadZoom"). SpreadZoom is domiciled in
Tianjin, China with a registered capital of $47,352,700 (RMB 300,000,000). As of September 30, 2012, $17,520,500 (RMB 111,000,000) in capital had
been contributed to SpreadZoom; the Company contributed $12,342,358 (RMB 78,000,000).  As of September 30, 2012, the Company has used the equity
method to account for its investment in SpreadZoom.

24September 30,2013Financial Position of SpreadZoom


(Unaudited)Current assets

$
26,542,710Non-current assets


3,669,499Total assets


30,212,209Current liabilities


13,394,293Non-current liabilities


-Total liabilities


13,394,293Net ssset value

$
16,817,916Three Months


Nine MonthsResults of Operations of SpreadZoom


Ended September 30,


Ended September 30,2013


2013(Unaudited)


(Unaudited)Net revenues

$
15,466,008

$
51,989,850Cost of goods sold


14,602,540


50,749,207Gross profit


863,468


1,240,643Operating expenses


468,792


1,551,314Operating income (loss)


394,676


(310,671)Other income (expenses), net


(25,464)


(24,447)Income (loss) before taxes


369,212


(335,118)less: Provision for income taxes


-


-Net income (loss)

$
369,212

$
(335,118)Investment loss attributable to Zoom Technologies, Inc.

$
174,895

$
(158,746)



25NOTE 16 - DISCONTINUED OPERATIONS
The detailed results of operations for discontinued operations shown below for the three and nine months ended September 30, 2013 include
the results of TCB Digital, Ever Elite, Nollec Wireless, and Portables.  The detailed results of operations for discontinued operations shown below for the
three and nine months ended September 30, 2012 include the results of TCB Digital, Profit Harvest, CDE, Ever Elite, Nollec Wireless, and Portables.

Results of Operations


Three Months Ended September 30,


Nine Months Ended September 30,2013


2012


2013


2012(Unaudited)


(Unaudited)


(Unaudited)


(Unaudited)Net revenues

$
49,633,292

$
117,180,898

$
170,083,852

$
306,717,488Cost of sales


48,002,298


111,193,306


160,180,706


286,251,895Gross profit


1,630,994


5,987,592


9,903,146


20,465,593Operating expenses


4,479,634


3,663,827


11,279,690


12,987,224Operating (loss) income


(2,848,640)


2,323,765


(1,376,544)


7,478,369Other income (expenses), net


(831,631)


26,893


(2,828,766)


(908,405)(Loss) income before taxes from discontinued operations


(3,680,271)


2,350,658


(4,205,310)


6,569,964less: Provision for income taxes


90


601,837


21,277


1,505,386(Loss) income from discontinued operations, net of tax

$
(3,680,361)

$
1,748,821

$
(4,226,587)

$
5,064,578Basic and diluted (loss) income per common share fromdiscontinued operations:Basic

$
(4.57)

$
0.54

$
(5.42)

$
1.85Diluted

$
(4.57)

$
0.54

$
(5.42)

$
1.85




26Financial Position


September 30,


December 31,2013


2012(Unaudited)Cash and equivalents

$
8,730,872

$
3,667,924Restricted cash


69,630,402


64,467,142Accounts receivable, net


36,676,226


38,889,208Inventories,net


13,320,789


7,988,710Other receivables and prepaid expenses


2,657,549


10,697,074Advance to suppliers


478,223


5,027,089Notes receivable


325,924


548,218Due from related parties


6,471,812


17,144,272Construction in progress deposit


-


278,996Property, plant and equipment, net


1,098,498


3,670,327Intangible assets, net


-


473,772Goodwill


-


27,031,492Total current assets


139,390,295


179,884,224Total Assets of Discontinued Operations

$
139,390,295

$
179,884,224Short-term loans

$
42,533,081

$
24,707,679Notes payable


28,957,279


28,156,022Accounts payable


26,996,853


22,625,660Accrued expenses and other payables


932,246


3,591,128Advances from customers


21,802


1,039,775Taxes payable


(2,422,890)


(2,341,883)Interest payable


-


110,835Dividends payable


628,890


628,890Due to related parties


42,360,470


76,824,918Total current liabilities


140,007,731


155,343,024Total Liabilities of Discontinued Operations


140,007,731


155,343,024Net Assets of Discontinued Operations

$
(617,436)

$
24,541,200The sale of all of the business operations to Beijing Zhumu Culture Communication Company, Ltd. covered in the Share Purchase Agreement as
described in "Note 1 - Organization and Nature of Business Operations" was for approximately $31.7 million (RMB 200 million) in sales proceeds. The
Share Purchase Agreement covers the sale of several business operations in different jurisdictions, with differing regulatory requirements regarding the
purchase and sale of businesses. The table of above details the portion of the transaction related to the sale of Profit Harvest and CDE, which closed on
December 31, 2012, for proceeds of $23.0 million. The portion of the sale covered in the Share Purchase Agreement for Ever Elite and Nollec Wireless
generated proceeds of $500,000. This sales transaction closed on April 5, 2013. The balance of the sales proceeds, approximately $8.2 million will be
allocated to TCB Digital upon the closing of that transaction.  The Company has also included all the assets and liabilities of Portables at December 31,
2012 in discontinued operations.

27The Company recognized revenues from related parties in discontinued operations of $37,842,847 and $50,163,444 for nine months ended September
30, 2013 and 2012, respectively; for the three months ended September 30, 2013 and 2012, the Company recognized revenues of $5,252,769 and
$20,101,749 respectively.


NOTE 17 - DEFAULT OF NOTE OWED TO PORTABLES UNLIMITED, INC.
As of July 15, 2013, the Company was in default of the promissory note for $2,000,000 owed to Portables Unlimited, Inc.  The Company has
not been provided financial information for the quarter ended September 30, 2013.  The Company has determined that it will not able to recover its
investment in Portables; accordingly, the Company has written off its investment in full.

NOTE 18 - CORRECTION OF ERROR FOR ACCOUNTING OF WARRANTS AS DERIVATIVE SECURITIES
Zoom management discovered during the quarter ended September 30, 2012 that in accordance with ASC 815 (formerly EITF 07-5) the
Company had incorrectly accounted for warrants issued in the years 2009 and 2010 as equity.  Series A, C, F, and related placement agent warrants
contained anti-dilution provision that according to the above guidance required that these derivative securities be accounted for as liabilities and marked to
market at each reporting period.  The Series G, and related placement agent warrants contained change of control provisions that required that the
warrants be accounted for as liabilities because the securities were no longer indexed to the Company's stock; rather there were characteristics that
required them to be accounted for as standalone securities that are considered liabilities to the Company. As a result the results of operations for the three
and nine months ended September 30, 2012 have been restated as follows:

Three Months Ended September 30, 2012As Previously





As CurrentlyReported


Adjustment


ReportedOther income (expenses)Change in fair value of warrants

$
-

$
350,323

$
350,323Net income attributable to Zoom Technologies, Inc.

$
419,939

$
350,323

$
770,262Basic and diluted income per common share:Basic

$
0.02

$
0.01

$
0.03Diluted

$
0.02

$
0.01

$
0.03

Nine Months Ended September 30, 2012As Previously





As CurrentlyReported


Adjustment


ReportedOther income (expenses)Change in fair value of warrants

$
-

$
233,370

$
233,370Net income attributable to Zoom Technologies, Inc.

$
1,061,824

$
233,370

$
1,295,194Basic and diluted income per common share:Basic

$
0.04

$
0.01

$
0.05Diluted

$
0.04

$
0.01

$
0.0528The Company assessed the value of these warrants by using the binomial lattice model. When the Company valued the warrants it used the following
assumptions as part of inputs into the valuation model: US treasury rate of 0.34% as a measure of the risk free rate of return. The Company also used the
mean of the annualized standard deviation of the log normal returns of comparable companies in the same line of business as measure of volatility which
was 44.42% at June 30, 2012. The Company controls whether dilution may occur, so it did not add additional assumptions regarding dilutive events into
the future discrete outcomes found in the model. The warrants values were adjusted for the dilutive effect as ratio of the outstanding common stock at the
time of measurement. In determining the probabilities of an up movement or down movement in the discrete outcomes, as well as the related magnitude of
such up or down movements, the Company used a Cox-Ross-Rubenstein approach in applying the binomial lattice model.

These corrections will be made to applicable prior period financial information in future filings with the SEC including this filing.










29REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Audit Committee of the 
Board of Directors and Shareholders of 
Zoom Technologies, Inc.

We have reviewed the accompanying condensed consolidated balance sheet of Zoom Technologies, Inc. Affiliates &
Subsidiaries (the "Company") as of September 30, 2013, and the related condensed consolidated statements of operations, comprehensive
income (loss), for the three-month and nine-month period ended September 30, 2013 and 2012 and cash flows for the nine-month period ended
September 30, 2013 and 2012. These financial statements are the responsibility of the company's management.
We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States).
A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit conducted in accordance with standards of the Public Company Accounting
Oversight Board (United States), the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly,
we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should be made to the accompanying interim financial
statements for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with auditing standards generally accepted in the United States of America, the
consolidated balance sheet of Zoom Technologies Inc. Affiliates & Subsidiaries as of December 31, 2012, and the related consolidated statements
of operations and comprehensive income (loss), stockholders' equity and cash flows for the year then ended (not presented herein); and in our report
dated April 15, 2013, we expressed an unqualified opinion on those consolidated financial statements.  In our opinion, the information set forth in the
accompanying consolidated balance sheet as of December 31, 2012, is fairly stated, in all material respects, in relation to the consolidated balance
sheet from which it has been derived.

/s/ Marcum Bernstein & Pinchuk LLPMarcum Bernstein & Pinchuk LLPNew York, NYNovember 25, 201330Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
Forward Looking Information
The following discussion contains forward-looking statements. Forward looking statements are identified by words and phrases such as
"anticipate", "intend", "expect", and words and phrases of similar import. We caution investors that forward-looking statements are only predictions based
on our current expectations about future events and are not guarantees of future performance. Actual results, performance or achievements could differ
materially from those expressed or implied by the forward-looking statements due to risks, uncertainties and assumptions that are difficult to predict. We
encourage you to read those risk factors carefully along with the other information provided in this report and in our other filings with the SEC before
deciding to invest in our stock or to maintain or change your investment. We undertake no obligation to revise or update any forward-looking statement for
any reason, except as required by law.
You should read this Management's Discussion and Analysis in conjunction with the Condensed Consolidated Financial Statements and Related
Notes.
Corporate Overview
Zoom Technologies, Inc. (the "Company") was incorporated in the state of Delaware on February 29, 2002. Until September 22, 2009, our
business was the design, production, marketing, sales, and support of broadband and dial-up modems, Voice over Internet Protocol or "VoIP" products and
services, Bluetooth® wireless products, and other communication-related products.
On September 22, 2009, the Company consummated a share exchange transaction and acquired all the outstanding shares of Gold Lion Holding
Limited ("Gold Lion"), a company organized and existing under the laws of the British Virgin Islands ("BVI"). In connection with the share exchange
transaction, the Company spun off its then-existing business to its stockholders, by distributing and transferring all assets and liabilities to its then
subsidiary, Zoom Telephonics, Inc., and issuing shares of its then operating subsidiary as a dividend to its stockholders.
Zoom's Operations in China
The Company, through Gold Lion, was the owner of 100% of Profit Harvest Corporation Ltd., a company organized under the laws of Hong
Kong ("Profit Harvest"), which owns 100% ownership of Celestial Digital Entertainment, Ltd., a mobile platform video game development company based in
Hong Kong. The Company, through Gold Lion's wholly owned subsidiary, Jiangsu Leimone, was the owner of 80% of TCB Digital, a company organized
under the laws of the People's Republic of China ("PRC"). Both TCB Digital and Jiangsu Leimone were in the business of manufacturing, research and
development, and sales of electronic components for third generation mobile phones, wireless communication circuitry, GPS equipment, and related
software products.

31The Company also held 100% ownership of Silver Tech Enterprises, Ltd ("Silver Tech"), a BVI holding company which owns 100% of Ever Elite
Corporation, Ltd ("Ever Elite"), a Hong Kong holding company, which owns 100% of Nollec Wireless ("Nollec"), a mobile phone and wireless
communication design company located in Beijing, China.
On October 26, 2011, the Company closed the sale of 1,676,300 shares of common stock to Spreadtrum Communications, Inc., ("Spreadtrum") in
consideration of $2,900,000, pursuant to a Common Stock Purchase Agreement (the "Purchase Agreement") entered into by and among the Company,
Spreadtrum and Leo (Lei) Gu (the "Key Stockholder"). Pursuant to the Purchase Agreement, the Company also agreed to design and develop all
applicable Company products to integrate and operate solely with Spreadtrum's products, and to not design and develop any Company products to
integrate or operate with any Spreadtrum's competitive products for a term of three years from the Purchase Agreement. Also pursuant to the Purchase
Agreement, Spreadtrum has the right to nominate one nominee to the board of directors of the Company (the "Nomination Right"), subject to approval of
the Company's independent directors, as required under Nasdaq Rule 5605(e)-Independent Director Oversight of Director Nominations. Spreadtrum's
Nomination Right shall continue until such time that Spreadtrum owns not less than 838,150 shares of the Company's outstanding common stock. In
accordance to the Purchase Agreement, Dr. Leo Li, Chairman and Chief Executive Officer of Spreadtrum, was added to our Board of Directors.  Dr. Li
resigned from our Board and Spreadtrum has appointed Mr. Chin Hung (James) Lo effective May 27, 2013.
In May 2012, the Company and Spreadtrum Communications (Tianjin) Co, Ltd formed a joint venture in Tianjin City, China, named SpreadZoom
Technologies, Inc. ("SpreadZoom"), of which the Company holds 47.4% ownership. In connection with the joint venture, the Company contributed a
manufacturing facility valued at approximately $11 million into SpreadZoom. SpreadZoom's business is focused on manufacturing and sales of mobile
phones containing certain chipset products of Spreadtrum.
Subsidiary Sale
On December 31, 2012, the Company entered into a Share Purchase Agreement (the "SPA") with Beijing Zhumu Culture Communication
Company, Ltd. (the "Purchaser"), a PRC company that provides services to the telecommunication industry. Pursuant to the SPA, the Company agreed to
sell (the "Subsidiary Sale") to the Purchaser all the equity interests the Company holds in its China based subsidiaries (except for SpreadZoom as
mentioned above), which include 100% of the outstanding equity interest of Ever Elite and its wholly owned subsidiary Nollec, 80% of the outstanding
equity interest of TCB Digital, 100% of the outstanding equity interest of Profit Harvest, and 100% of the outstanding equity interest of CDE. As
consideration for the Subsidiary Sale, the Purchaser agreed to pay to the Company RMB 200 million (approximately US$31.7 million) (the "Purchase
Price"), subject to adjustment pending an appraisal by an independent third party appraiser. As of the date of this report, the Purchaser has remitted the
entire amount of RMB 200 million to the Company to use; accordingly, in the normal course of business, a negotiated amount of RMB 80 million of funds
was released from escrow to the Company that was deployed to SpreadZoom and Tianjin Leimone as detailed in "Note 8 - Related Party Transactions" as
agreed by the Purchaser. Upon the final closing of the Subsidiary Sale, which will occur 30 days after the Company receives all the requisites corporate
and regulatory approvals with respect to the Subsidiary Sale, the balance of the escrowed funds will be released to the Company. As of the date of this
quarterly report, the transfer of ownership of Profit Harvest, Nollec Wireless and CDE has been completed.

32Zoom's Operation in the U.S.
On October 12, 2011, the Company and Zoom USA Holdings, Inc., a wholly-owned subsidiary of the Company ("Zoom Sub") entered into a
Securities Purchase Agreement to purchase from The Cellular Network Communications Group, Inc. ("CNCG") a 50% interest in Portables Unlimited LLC
("Portables"), an exclusive wholesale distributor of T-Mobile products in the United States. As consideration of the 50% interest in Portables, Zoom (i)
issued 1,494,688 shares of Zoom common stock (the "Equity Consideration") to the principals of CNCG and (ii) through Zoom Sub, issued a promissory
note of $500,000 payable to CNCG. The promissory note accrues interest at 2% and matures three years from the date of issuance. In addition, Zoom Sub
purchased an additional 5% interest in Portables for $750,000. Further, in connection with the transaction, Zoom assumed the responsibility for repaying
certain indebtedness owed by Portables to T-Mobile USA, Inc. of $4,757,187 (the "T- Mobile Indebtedness"), and agreed to arrange for a $500,000 letter of
credit in the name of Portables to secure obligations of Portables to T-Mobile. The T-Mobile Indebtedness was payable under the following schedule:
$2,500,000 was due on November 10, 2011 (the "Initial Payment"), $1,400,000 was due on December 10, 2011 (the "Second Payment"), and the
remaining $857,186 was due on December 20, 2011 (the "Final Payment"). The Initial Payment and Second Payment were made timely, and pursuant to
the agreement with T-Mobile the Final Payment was waived. Zoom also agreed to pay other outstanding indebtedness of Portables of $4,500,000, less the
amount of T-Mobile Indebtedness paid off. Additionally, the Company had previously recognized acquisition payables to Portables in the amount of
$1,350,000 and the need to arrange a $500,000 Letter of Credit in Portables' name to secure obligations to T-Mobile. As of June 30, 2013, the Company's
and Portables Unlimited, Inc.'s ownership interests in Portables was 50.1% and 49.9%, respectively.  Subsequent to June 30, 2012, the Company was in
default of a promissory note owed to Portables Unlimited, Inc.  If the Company was unable to cure the default, the Company's ownership in Portables could
be transferred to Portables Unlimited, Inc., and the Company could be potentially subject to a loss in the range of approximately $5.0 million to $9.0 million.
The Company has not been able to cure its default, and the Company has determined it will not be able to recover its investment; accordingly, the
Company has written off the investment in full.

Our principal executive offices are located in the People's Republic of China at Sanlitun SOHO, Building A, 11th Floor, No.8 Workers Stadium North
Road, Chaoyang District, Beijing, China 100027; our telephone number is 86-10-5935-9000. Our corporate web site address iswww.zoom.com.

The diagram below summarizes our corporate structure as of September 30, 2013:




33Plan of Operation
During the next 12 months, Zoom, together with its subsidiaries, expects to take the following steps in connection with the development of our
business and the implementation of our plan of operations:

Zoom will restructure itself towards investment in more high growth businesses.Critical Accounting Policies and Estimates
The preparation of Zoom's consolidated financial statements in conformity with accounting principles generally accepted in the United States ("US
GAAP") requires it to make estimates and judgments that affect its reported assets, liabilities, revenues, and expenses, and the disclosure of contingent
assets and liabilities. Zoom based its estimates and judgments on historical experience and on various other assumptions that it believes to be reasonable
under the circumstances. Future events, however, may differ markedly from current expectations and assumptions. While there are a number of significant
accounting policies affecting Zoom's consolidated financial statements, we believe the following critical accounting policies involve the most complex,
difficult and subjective estimates and judgments: allowance for doubtful accounts; income taxes; asset impairment.

Revenue Recognition
In accordance with US GAAP, revenue is recognized only when the price is fixed or determinable, persuasive evidence of an arrangement exists,
the service is performed, and collection of the resulting receivable is reasonably assured. Noted below are brief descriptions of the product or service
revenues that Zoom recognizes in the financial statements contained herein.
The Company recognizes sales in accordance with the U.S. Securities and Exchange Commission ("SEC") Staff Accounting Bulletin ("SAB") No. 104,
"Revenue Recognition in Financial Statements" (FASB ASC Topic 605), "Revenue Recognition."

The Company recognizes revenue when the following criteria are met:
(i) persuasive evidence of an arrangement exists;
(ii) delivery has occurred or services were rendered;
(iii) the price to the customer is fixed or determinable and,
(iv) collection of the resulting receivable is reasonably assured. Revenue is not recognized until title and risk of loss is transferred to the customer,
which occurs upon delivery of goods, and objective evidence exists that customer acceptance provisions were met.The Company bases its estimates on historical experience taking into consideration the type of products sold, the type of customer, and the type of
specific transaction in each arrangement. Revenues represent the invoiced value of goods, net of value added tax ("VAT").
The Company does not offer promotional payments, customer coupons, rebates or other cash redemption offers to its customers. Deposits or advance
payments from customers prior to delivery of goods and passage of title of goods are recorded as advanced from customers.
Income is recognized as the percentage of estimated total income that incurred costs to date divided by estimated total costs after giving effect to
estimates of costs to complete based on most recent information. Percentage of completion is based on labor hours incurred to date divided by total
estimated labor hours for the contract.

34Royalty income on sales of licensed products by its customers is recorded when the customers report sales to the Company. Royalty income is
reported monthly and recorded in the period in which the product is sold. The Company has the right to audit the books of the licensees.
Revenue from the sale of equipment is recognized upon shipment.
Allowance for doubtful accounts
Zoom maintains an allowance for doubtful accounts to reduce amounts to their estimated realizable value. A considerable amount of judgment is
required when Zoom assesses the realization of accounts receivables, including assessing the probability of collection and the current credit-worthiness of
each customer. If the financial condition of customers were to deteriorate, resulting in an impairment of their ability to make payments, an additional
provision for doubtful accounts could be required. Zoom initially records a provision for doubtful accounts based on its historical experience, and then
adjusts this provision at the end of each reporting period based on a detailed assessment of its accounts receivable and allowance for doubtful accounts. In
estimating the provision for doubtful accounts, Zoom considers: (i) the aging of the accounts receivable; (ii) trends within and ratios involving the age of the
accounts receivable; (iii) the customer mix in each of the aging categories and the nature of the receivable; (iv) its historical provision for doubtful accounts;
(v) the credit worthiness of the customer; and (vi) the economic conditions of the customer's industry as well as general economic conditions, among other
factors. Management regularly reviews outstanding receivables to determine their recoverability. Zoom regularly reviews the credit policies and procedures
of its operating subsidiaries to ensure that procedures are appropriate to the Company's risk management approach as well as the general economic
environment.
Income taxes
Zoom accounts for income taxes in accordance with SFAS No. 109 (ASC Topic 740), "Accounting for Income Taxes". Under this method,
deferred income taxes are recognized for the estimated tax consequences in future years of differences between the tax bases of assets and liabilities and
their financial reporting amounts and each year-end based on enacted tax laws and statutory rates applicable to the periods in which the differences are
expected to affect taxable income. Valuation allowances are established to reduce deferred tax assets to the amount expected to be realized when, in
management's opinion; it is more likely than not that some portion of the deferred tax assets will not be realized. The
provision for income taxes represents current taxes payable net of the change during the period in deferred tax assets and liabilities. Zoom adopted FIN 48
(ASC Topic 740), Accounting for Uncertainty in Tax Positions. Zoom has engages tax preparers in all of the jurisdictions in which it operates to determine if
the Company is both fully compliant with applicable tax laws and is lawfully maximizing tax benefits to the Company.
Asset Impairment
Zoom periodically evaluates the carrying value of other long-lived assets, including, but not limited to, property and equipment and intangible
assets, when events and circumstances warrant such a review. The carrying value of a long-lived asset is considered impaired when the anticipated
undiscounted cash flows from such asset is less than its carrying value. In that event, a loss is recognized based on the amount by which the carrying
value exceeds the fair value of the long-lived asset. Fair value is determined primarily using the anticipated cash flows discounted at a rate commensurate
with the risk involved. Significant estimates are utilized to calculate expected future cash flows utilized in impairment analyses. Zoom also utilizes judgment
to determine other factors within fair value analyses, including the applicable discount rate. As of September 30, 2013, the Company has completely written
off goodwill resulting from its acquisition of Jiangsu Leimone, Silver Tech, CDE, and Portables.

35Results of Operations for the Three and Nine Months Ended September 30, 2013
Revenues
Our revenues from continuing operations were $0 for the three and nine months ended September 30, 2013 and 2012. The Company is
restructuring its business and expects to consummate a transaction by investing in a high growth technology based businesses.
Cost of sales
For the three and nine months ended September 30, 2013 and 2012, our costs of sales from continuing operations were $0.  As previously
noted, the Company is restructuring its business.
Gross Profit
Gross profits from continuing operations for the three and nine months ended September 30, 2013 and 2012 were $0.
Operating expenses
Sales, general and administrative expenses from continuing operations primarily consisted of compliance expense related to maintain the
Company's status as public company.
Non-cash equity-based compensation on go forward basis reflects grants and awards that have been issued to personnel still in the service of the
Company's continuing operating entities.

Other income/(expenses)-net
The Company's other income-net expense was $142,631 for the three months ended September 30, 2013 and other net income $99,653 for
the three months ended September 30, 2012.   Other expense, net was $303,513 for the nine months ended September 30, 2013 and other income, net was $72,016 for the nine
months ended September 2012.  There was a net investment gain for SpreadZoom of $174,895 for the three months ended September 30, 2013 as
compared to an investment loss of $423,630 for the same period in 2012.   The investment loss for the nine months ended September 30, 2013 was
$158,746 compare to 423,630 for the same period in 2012.

Net (loss) income
For the three months ended September 30, 2013 and 2012, the Company's net loss was $14,090,817 as compared to net income of $752,314
for the corresponding period in 2012. For the nine months ended September 30, 2013 and 2012, the Company's net loss was $18,282,626 as compared to
net income of $2,047,508 for the corresponding period in 2012. The substantial losses are the result of the company restructuring and disposition of
assets, as well as the write-off of its investment in Portables.
Other comprehensive income/(loss)
The Company's other comprehensive income is attributable to foreign currency exchange fluctuations particularly the Renminbi against the
USD.
Liquidity and Capital Resources
Zoom generally finances its operations from cash flow generated internally, interest-free credit lines in the form of banker acceptances and
short-term loans from domestic banks. As of September 30, 2013, the Company had cash and equivalents of $1,818,816 and restricted cash of $19,555,440 in
continuing operations. Restricted cash reflects the funds deposited with the Company for sale to Beijing Zhumu Culture Communication Company, Ltd. of
Profit Harvest, CDE, Ever Elite, Nollec Wireless, and TCB Digital. The Company had cash and equivalents for continuing operations of $8,351 and
restricted cash of $19,044,294 as of December 31, 2012.

36Net cash provided by operating activities for the nine months ended September 30, 2013 was $9,039,133 compared to net cash used in operating
activities of $5,257,831 for the same period in 2012. In the first nine months of 2013, operational use of funds included increases in accounts
receivable of $3,160,104 and increases in inventories of $6,076,358.  The Company sourced cash in operations by decreasing prepaid expense and
other receivables by $9,431,490 while increasing accounts payables by $8,768,972.

Net cash used in investing activities was $4,624,861 in the nine months ended September 30, 2013 as compared to net cash used in investing
activities in $8,639,109 for the same period in 2012.  The primary use of cash was the increase in restricted cash of $3,390,538 which collateralizes
our notes payable in our discontinued operations, and the purchase of fixed assets for $727,785 net cash provided was the release of certain cash held.

Net cash provided by financing activities was $2,974,315 for the nine months ended September 30, 2013 as compared to $16,548,569 in the
same period in 2012. The source of cash was primarily attributable to increase in bank loans of $23,042,792 while the Company used $20,173,332 to repay related parties.

Contractual Obligations
As of September 30, 2013, the Company had promissory note obligations outstanding for past acquisitions totaling $495,937.
On a go forward basis over the next 12 months, Zoom intends to continue to rely restricted cash to fund its operational cash needs. In the event
that expansion or acquisition opportunities exist, we may contemplate additional conventional bank and/or equity financing to take advantage of such
opportunities. However, there is no assurance that such opportunities can be found, and if so, whether financing is available at acceptable terms.

Off Balance Sheet Arrangements
As of September 30, 2013, Zoom had no off balance sheet arrangements.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Not applicable.

Item 4. Controls and Procedures.
(a) Disclosure Controls and Procedures.
The Company's disclosure controls and procedures are designed to ensure that information required to be disclosed in the Company's reports filed
under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized, and reported within the time periods specified in the
SEC's rules and forms, including, without limitation, that such information is accumulated and communicated to Company management, including the
Company's principal executive and financial officer, as appropriate to allow timely decisions regarding required disclosures.

Limitations on the Effectiveness of Disclosure Controls. In designing and evaluating the Company's disclosure controls and procedures,
management recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not
absolute, assurance that the objectives of the disclosure controls and procedures are met. Additionally, in designing disclosure controls and procedures,
Company management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and
procedures. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events,
and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

37Evaluation of Disclosure Controls and Procedures. Our management,
with the participation of our chief executive officer and our chief financial officer, have evaluated the effectiveness of our disclosure controls and
procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended) and concluded that because
of the material weaknesses in our internal controls over financial reporting discussed below, our disclosure controls and procedures were not effective as
of November 25, 2013.  As detailed in the Explanatory Note found in this Form 10Q/A, on November 19, 2013 prior to receiving approval from the
Company's registered independent public accountant, the Company filed its Form 10Q.

A control system, no matter how well conceived and operated, can provide only reasonable assurance that the objectives of the control system are
met. Our management, including our chief executive officer and chief financial officer, does not expect that our disclosure controls and procedures or
internal control over financial reporting will prevent all errors and fraud. Further, the design of a control system must reflect the fact that there are
resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no
evaluation of controls can provide absolute assurance that all control issues within our company have been detected. These inherent limitations include
the reality that judgments in decision-making can be faulty, and that breakdowns can occur because of simple errors or mistakes. The design of any
control system is also based, in part, upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will
succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in
conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a control system,
misstatements due to error or fraud may occur and not be detected.

Evaluation of Disclosure Controls and Procedures. The Company's principal executive and financial officers have evaluated the
effectiveness of the design and operation of the Company's disclosure controls and procedures as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)
as of September 30, 2013, and based on this evaluation, the Company's principal executive and financial officers have concluded that the
Company's disclosure controls and procedures were ineffective to ensure that material information is recorded, processed, summarized and reported by
management of the Company on a timely basis in order to comply with the Company's disclosure obligations under the Exchange Act and the rules and
regulations promulgated thereunder. The Company's principal executive and financial officers conclusion regarding the Company's disclosure controls
and procedures is based solely on management's conclusion that the Company's internal control over financial reporting are ineffective.

Material Weaknesses in Internal Control over Financial Reporting. A material weakness is a deficiency, or combination of deficiencies, in
internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial
statements will not be prevented or detected on a timely basis. Our management identified the following material weaknesses in our internal controls
over financial reporting as of November 25, 2013.

Financial Close and Reporting Process

Our management concluded that the controls over our financial close and reporting process did not operate effectively as of November 25, 2013. In
particular, management detected errors in its instructions to the Company's EDGAR printing service.  As detailed in the Explanatory Note, on November
19, 2013, the Company issued instructions to its printer to file its Form 10Q prior to receiving approval from its registered public accountants. The error
was deemed to be individually material, this occurrence is indicative that the controls related to the financial close and reporting process were not
operating in an effective manner.

As described below under the heading "Changes in Internal Controls Over Financial Reporting,"we have implemented a new
procedure since the occurrence on November 19, 2013 designed to remediate our material weakness with respect to our financial close and reporting
process, and our management has concluded that these efforts have led to the remediation of the this material weakness.


38(b) Changes in Internal Control over Financial Reporting.

Except for those described below, there have been no changes in our internal control over financial reporting since
November 19, 2013 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Financial Close and Reporting Process


In order to remediate the material weakness described above with respect to our financial close and reporting process, we took certain steps during
the time after November 19, 2013 to ensure the remediation and continued effectiveness of our controls in subsequent periods.
We implemented a new policy requiring our printer to receive official, independent communication from attorneys and indication
from the chief financial officer  that our auditors have given us permission to file before filing any forms that include financial information
that requires assurance.
As a result of this being a new procedure, the Company's management is still evaluating the effectiveness of the
new internal control procedures to effectively remediate our material weaknesses.


PART II - OTHER INFORMATION
Item 1. Legal Proceedings.

Leimone (Tianjin) Industrial Co., Ltd ("Leimone Tianjin"), a related party, is currently involved with a dispute with the
construction company contracted to build our new manufacturing facility in Tianjin. On August 15, 2011, Leimone Tianjin filed a claim against Henan Urban
Construction Group ("HUCG"). The claim is for the termination of the construction contract between Leimone Tianjin and HUCG and claims damages of
approximately $1.3 million (RMB 8,072,310) against HUCG. In Leimone Tianjin's court filing, it has accused HUCG of improper use of the funds paid to
HUCG by Leimone Tianjin, as a result, construction project has been delayed. HUCG's has claimed as its defense that the delay in construction was a
result of poor conditions at the construction site. The Mid-Level People's Court of Tianjin City has issued a decision in the last quarter of 2012 which is
acceptable to the Company. HUCG appealed the decision and in the second quarter of 2013, the Court of Appeals upheld the previous rulings. The Courts
have executed on its ruling and removed the HUCG from the premises.
Other than our dispute disclosed above we are not a party to any material legal proceedings nor are we aware of any circumstance that may
reasonably lead a third party to initiate legal proceedings against us.

Item 1A. Risk Factors.
Not applicable.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Not applicable.

39Item 3. Defaults Upon Senior Securities.
The Company is default of a promissory note issued to Portables Unlimited, Inc.  The Company has written down its investment in Portables as it
believes it cannot recover its investment.
Item 4. Mine Safety Disclosures.
Not applicable.

Item 5. Other Information.
On November 27, 2012, the Company received notice from NASDAQ that it was not in compliance with its continued listing rules for its common
stock requiring a minimum $1 bid price.  The Company was granted 180 days regain compliance.  On May 29, 2013, the Company was granted an
extension by NASDAQ for 180 days to regain compliance by November 25, 2013.  The Company effectuated a 10 for 1 reverse split of its common stock to
help regain compliance.  As of the date of the filing, there is no assurance that the Company will regain compliance.

Item 6. Exhibits.

The following exhibits are included with this report.


Exhibit 31.1 Rule 13a-14(a) / 15d-14(a) Certification of Lei Gu, CEO.
Exhibit 31.2 Rule 13a-14(a) / 15d-14(a) Certification of Patrick Wong, CFO.
Exhibit 32.0 Section 1350 Certifications.
101.INS      XBRL Instance Document
101.SCH      XBRL Taxonomy Extension Schema Document
101.CAL      XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF      XBRL Taxonomy Extension Definition Linkbase Document
101.LAB      XBRL Taxonomy Extension Label Linkbase Document
101.PRE      XBRL Taxonomy Extension Presentation Linkbase Document40SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf on November 19, 2013 by the undersigned, thereunto duly authorized.

Zoom Technologies, Inc.
   (Registrant)
By: /s/ Lei Gu
Lei Gu
Chief Executive Officer












41INDEX TO EXHIBITS 

Exhibits:


31.1
Rule 13a-14(a) / 15d-14(a) Certification of Lei Gu, CEO31.2
Rule 13a-14(a) / 15d-14(a) Certification of Patrick Wong, CFO32.0
Section 1350 Certifications101.INS
XBRL Instance Document101.SCH
XBRL Taxonomy Extension Schema Document101.CAL
XBRL Taxonomy Extension Calculation Linkbase Document101.DEF
XBRL Taxonomy Extension Definition Linkbase Document101.LAB
XBRL Taxonomy Extension Label Linkbase Document101.PRE
XBRL Taxonomy Extension Presentation Linkbase Document42