Sonic Solutions Receives Notice From NASDAQ Due to Inability to Timely File Form...

Sonic Solutions Receives Notice From NASDAQ Due to Inability to Timely File
Form 10-Q

NOVATO, Calif., Feb. 15 /PRNewswire-FirstCall/ -- Sonic Solutions (R)
(Nasdaq: SNIC) today announced it had received, as expected, an additional
notice of non-compliance from the Listing Qualifications Staff of The NASDAQ
Stock Market (the "Staff") on February 15, 2008 due to Sonic's failure to
timely file its Quarterly Report on Form 10-Q for its fiscal quarter ended
December 31, 2007 (the "Additional Staff Determination"), as required by
NASDAQ Marketplace Rule 4310(c)(14).
Sonic has delayed the filing of its Quarterly Report on Form 10-Q for the
third quarter of fiscal 2008 (which ended December 31, 2007) until it has
completed the restatement process, which could impact the financial statements
for the third quarter of fiscal 2008, and filed the documents containing the
restated financial statements.
As previously announced on February 1, 2007, Sonic has commenced a
voluntary review of its historical and current stock option grant practices
and related accounting. Based on the review, the audit committee of Sonic's
board of directors and Sonic's management have concluded that, under
applicable accounting guidance, Sonic lacks sufficient documentation for
certain historical option grants and that the measurement dates associated
with these option grants will need to be adjusted. Further, as previously
announced, the audit committee, after consultation with management and Sonic's
board of directors, has determined that Sonic's annual and interim financial
statements may no longer be relied upon.
Sonic has determined that it will have to record additional cash and
non-cash charges for stock-based compensation expense and restate its previous
financial statements, and that such charges will be material. Sonic intends to
file its restated financial results and related periodic reports as quickly as
possible.
As previously announced, Sonic received prior notices of non-compliance
from the Staff based upon Sonic's failure to timely file its Quarterly Reports
on Form 10-Q for the quarters ended December 31, 2006, June 30, 2007 and
September 30, 2007 and its annual report on Form 10-K for its fiscal year
ended March 31, 2007, each as required by NASDAQ Marketplace Rule 4310(c)(14)
and for failure to solicit proxies and hold an annual meeting for its fiscal
year ended March 31, 2006, on or before March 31, 2007 as required by NASDAQ
Marketplace Rules 4350(e) and 4350(g), respectively. On January 8, 2008, Sonic
Solutions ("Sonic") received a letter from the Board of Directors of The
NASDAQ Stock Market LLC (the "NASDAQ Board") informing Sonic that the NASDAQ
Board had issued a decision granting Sonic until March 10, 2008 to file each
of its delinquent filings. Sonic's securities will remain listed on The NASDAQ
Global Select Market during this period. While Sonic is working diligently to
complete all necessary filings and thereby demonstrate compliance with the
applicable requirements for continued listing on The NASDAQ Global Select
Market, there can be no assurance that Sonic's common stock will remain listed
on The NASDAQ Global Select Market beyond the March 10, 2008 deadline
established by the NASDAQ Board or that NASDAQ will grant Sonic a further
extension if needed.
About Sonic Solutions
Sonic Solutions (Nasdaq: SNIC; www.sonic.com) enables the creation,
management, and enjoyment of digital media content from Hollywood to home.
Sonic's products range from the advanced authoring systems used to produce
Hollywood DVD, HD DVD, and Blu-ray Disc film releases to the award-winning
Roxio (R) -branded photo, video, music, and digital-media management
applications. Sonic's patented technologies and AuthorScript (R) media engine
are relied upon by leading technology firms to define rich media experiences
on a wide array of consumer electronics, mobile devices, set-top players,
retail kiosks, and PCs. Always an innovator, Sonic has taken a leading role in
helping professional and consumer markets make the successful transition to
the new high-definition media formats and, through the DVD On Demand(TM) and
Qflix platforms, Sonic is defining new models for the digital distribution of
premium Hollywood entertainment. Sonic Solutions is headquartered in Marin
County, California.
Sonic, the Sonic logo, Sonic Solutions, AuthorScript, Sonic DVD On Demand
and Roxio are trademarks or registered trademarks of Sonic Solutions or its
subsidiaries in the United States and/or other countries. All other company or
product names are trademarks or registered trademarks of their respective
owners and, in some cases, are used by Sonic under license.
Safe Harbor Statement under the Private Securities Litigation Reform Act
of 1995:
All statements included or incorporated by reference in this release,
other than statements or characterizations of historical fact, are
forward- looking statements. These forward-looking statements are based on our
current expectations, estimates and projections about our business and
industry, management's beliefs, and certain assumptions made by us, all of
which are subject to change. Forward-looking statements can often be
identified by words such as "anticipates," "expects," "intends," "plans,"
"predicts," "believes," "seeks," "estimates," "may," "will," "should,"
"would," "could," "potential," "continue," "ongoing," similar expressions, and
variations or negatives of these words. These forward-looking statements are
not guarantees of future results and are subject to risks, uncertainties and
assumptions that could cause our actual results to differ materially and
adversely from those expressed in any forward-looking statement.
These risks and uncertainties include, but are not limited to, our ability
to complete all necessary filings and thereby demonstrate compliance with the
applicable requirements for continued listing on The NASDAQ Global Select
Market by the deadline established by the NASDAQ Board; our ability to
persuade the NASDAQ board to extend the deadline to complete all delinquent
filings in the event we are unable to complete all necessary filings by the
March 10, 2008 deadline; the scope of the equity awards for which accounting
measurement dates will change; the amount and timing of stock-based
compensation and other additional expenses to be recorded, and the
corresponding restatement of our financial statements; other accounting
adjustments that may result from review of our financial statements for the
periods in question; the ramifications of our inability to file required
reports with the SEC on a timely basis; potential claims and proceedings
relating to such matters, including shareholder litigation and action by the
SEC or other governmental agencies; other actions taken or required as a
result of the review; and negative tax or other implications for the company
resulting from the accounting adjustments and other factors.
Our Annual Report on Form 10-K for our fiscal year ended March 31, 2006,
subsequent Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K,
and our other SEC filings discuss the foregoing risks as well as other
important risk factors that could contribute to such differences or otherwise
affect our business, results of operations and financial condition. The
forward-looking statements in this release speak only as of the date they are
made. We undertake no obligation to revise or update publicly any
forward-looking statement for any reason.
SOURCE Sonic Solutions

A. Clay Leighton, Chief Financial Officer, clay_leighton@sonic.com, or
investors, Nils Erdman, V.P. Investor Relations, nils_erdman@sonic.com, both
of Sonic Solutions, +1-415-893-8000, fax, +1-415-893-8008