2. Liquidity	6 Months Ended
Jun. 30, 2015
Notes to Financial Statements
Liquidity	Zoom’s cash and cash equivalents balance on June 30, 2015 was $252 thousand, up $115 thousand from December 31, 2014. Zoom’s maximum available line of credit was $1.25 million on June 30, 2015, of which bank debt outstanding under this line of credit was $1.04 million. Zoom’s $557 thousand decrease in net accounts receivable and $199 thousand increase in bank debt increased cash, while a $482 thousand increase in net inventory, and net loss of $101 thousand decreased cash. On June 30, 2015 the Company had working capital of $1.8 million including $252 thousand in cash and cash equivalents. On December 31, 2014 we had working capital of $2.1 million including $138 thousand in cash and cash equivalents. Our current ratio at June 30, 2015 was 1.8 compared to 2.1 at December 31, 2014. On December 18, 2012, the Company entered into a Financing Agreement with Rosenthal & Rosenthal, Inc. (the “Financing Agreement”). The Financing Agreement provided for up to $1.75 million of revolving credit, subject to a borrowing base formula and other terms and conditions as specified in the Financing Agreement. The Financing Agreement continued until November 30, 2014 and automatically renews from year to year thereafter, unless sooner terminated by either party as specified in the Financing Agreement. The Lender shall have the right to terminate the Financing Agreement at any time by giving the Company sixty days’ prior written notice. Borrowings are secured by all of the Company assets including intellectual property. The Loan Agreement contained several covenants, including a requirement that the Company maintain tangible net worth of not less than $2.5 million and working capital of not less than $2.5 million. On March 25, 2014, the Company entered into an amendment to the Financing Agreement (the “Amendment”) with an effective date of January 1, 2013. The Amendment clarified the definition of current assets in the Financing Agreement, reduced the size of the revolving credit line to $1.25 million, and revised the financial covenants so that Zoom is required to maintain tangible net worth of not less than $2.0 million and working capital of not less than $1.75 million. The Company is required to calculate its covenant compliance on a quarterly basis. As of June 30, 2015, the Company was in compliance with its working capital covenant, but was not in compliance with its tangible net worth covenant. The covenant requires that the Company maintain tangible net worth of not less than $2.0 million. At June 30, 2015, the Company’s tangible net worth was approximately $1.839 million, $161 thousand less than the $2.0 million required to meet the requirement. The Company has received a waiver of such covenant for the period ending June 30, 2015. At June 30, 2015 the Company's total current assets were $4.0 million, and current liabilities including $1.0 million bank debt were $2.2 million. The Company did not have any long-term debt at June 30, 2015. The Company is continuing to develop new products and to take other measures to increase sales. In addition, on May 18, 2015 Zoom announced licensing of the Motorola trademark for cable modems in North America for 5 years starting January 1, 2016. The Company believes that this is likely to dramatically increase sales. Increasing sales typically results in increased inventory and higher accounts receivable, both of which reduce cash. Zoom expects to raise funds in anticipation of this sales growth. Zoom believes that these funds, existing financial resources and line of credit will be sufficient to fund operations for the foreseeable future if Zoom management's sales and operating profit expectations are met.

2. Liquidity

6 Months Ended

Jun. 30, 2015

Zoom’s cash and cash equivalents balance on June 30, 2015 was $252 thousand, up $115 thousand from December 31, 2014. Zoom’s maximum available line of credit was $1.25 million on June 30, 2015, of which bank debt outstanding under this line of credit was $1.04 million. Zoom’s $557 thousand decrease in net accounts receivable and $199 thousand increase in bank debt increased cash, while a $482 thousand increase in net inventory, and net loss of $101 thousand decreased cash.

On June 30, 2015 the Company had working capital of $1.8 million including $252 thousand in cash and cash equivalents. On December 31, 2014 we had working capital of $2.1 million including $138 thousand in cash and cash equivalents. Our current ratio at June 30, 2015 was 1.8 compared to 2.1 at December 31, 2014.

On December 18, 2012, the Company entered into a Financing Agreement with Rosenthal & Rosenthal, Inc. (the “Financing Agreement”). The Financing Agreement provided for up to $1.75 million of revolving credit, subject to a borrowing base formula and other terms and conditions as specified in the Financing Agreement. The Financing Agreement continued until November 30, 2014 and automatically renews from year to year thereafter, unless sooner terminated by either party as specified in the Financing Agreement. The Lender shall have the right to terminate the Financing Agreement at any time by giving the Company sixty days’ prior written notice. Borrowings are secured by all of the Company assets including intellectual property. The Loan Agreement contained several covenants, including a requirement that the Company maintain tangible net worth of not less than $2.5 million and working capital of not less than $2.5 million. On March 25, 2014, the Company entered into an amendment to the Financing Agreement (the “Amendment”) with an effective date of January 1, 2013. The Amendment clarified the definition of current assets in the Financing Agreement, reduced the size of the revolving credit line to $1.25 million, and revised the financial covenants so that Zoom is required to maintain tangible net worth of not less than $2.0 million and working capital of not less than $1.75 million.

The Company is required to calculate its covenant compliance on a quarterly basis. As of June 30, 2015, the Company was in compliance with its working capital covenant, but was not in compliance with its tangible net worth covenant. The covenant requires that the Company maintain tangible net worth of not less than $2.0 million. At June 30, 2015, the Company’s tangible net worth was approximately $1.839 million, $161 thousand less than the $2.0 million required to meet the requirement. The Company has received a waiver of such covenant for the period ending June 30, 2015.

At June 30, 2015 the Company's total current assets were $4.0 million, and current liabilities including $1.0 million bank debt were $2.2 million. The Company did not have any long-term debt at June 30, 2015.

The Company is continuing to develop new products and to take other measures to increase sales. In addition, on May 18, 2015 Zoom announced licensing of the Motorola trademark for cable modems in North America for 5 years starting January 1, 2016. The Company believes that this is likely to dramatically increase sales. Increasing sales typically results in increased inventory and higher accounts receivable, both of which reduce cash. Zoom expects to raise funds in anticipation of this sales growth. Zoom believes that these funds, existing financial resources and line of credit will be sufficient to fund operations for the foreseeable future if Zoom management's sales and operating profit expectations are met.