Adaptec Approves Spin-Off of Roxio; Sets Record Date for Distribution of Roxio Stock to Stockholders
Milpitas, Calif., April 12, 2001 - Adaptec, Inc. (Nasdaq: ADPT), the global leader in data storage access solutions, today announced that its Board of Directors has approved the spin-off of its digital media subsidiary, Roxio, Inc., and has declared a special stock dividend to Adaptec stockholders to distribute outstanding shares of Roxio that Adaptec owns. The special stock dividend is expected to be payable on May 11, 2001 to Adaptec stockholders of record on April 30, 2001, and will mark the completion of Roxio's spinoff from Adaptec. The trading of the common stock of Roxio on the Nasdaq National Market is expected to begin on May 14, 2001 under the ticker symbol "ROXI". The declaration and payment of the dividend is contingent upon Roxio's registration statement on Form 10 being declared effective by the Securities and Exchange Commission and compliance with applicable federal and state securities laws.
Roxio is a leading provider of digital media software solutions enabling individuals to create, manage and move audio, video, photos and data onto recordable compact discs. Roxio's CD burning software, Easy CD Creator for Windows and Toast for the Macintosh, is the best selling CD burning software in the world. As an independent company, Adaptec believes that Roxio, under the leadership of a dedicated senior management team, will be better able to focus on its core business of developing software to enable the consumer to create and enjoy digital content. The new independent company will also enhance its ability to pursue strategic opportunities including the expansion of its product offerings for music, video, photo and data.
Adaptec holders of record will receive a pro-rata distribution of Roxio common stock based on the number of Adaptec and Roxio shares outstanding on April 30, the record date, and a cash payment in lieu of any fractional shares. There were 98,565,191 shares of Adaptec common stock outstanding at December 31, 2000, and there will be 16,500,000 shares of Roxio common stock outstanding as of the record date.
Adaptec expects to receive an opinion from its tax advisors that the dividend will be tax-free for federal income tax purposes to Adaptec and its stockholders, except for cash received by stockholders instead of fractional shares.
The conversion ratio applicable to Adaptec's 4 3/4 percent Convertible Subordinated Notes due 2004 is expected to be adjusted in connection with the proposed distribution of Roxio shares to Adaptec stockholders. The conversion ratio adjustment will be determined according to a formula set forth in the Indenture governing the Notes, and will be based on the fair market value of the Roxio stock and the average sales price per share of Adaptec common stock over a period of trading days preceding the record date.
Roxio, a division of Sonic Solutions, develops and markets the best-selling digital media software in the world. Roxio offers
award-winning software products for CD/DVD burning, photo editing and video editing and has an installed base of over 150 million
users. Roxio distributes its products globally through strategic partnerships with major hardware manufacturers, through leading
retailers, through Internet partnerships and through direct sales at www.roxio.com. Roxio's
parent company, Sonic Solutions (NASDAQ: SNIC;
http://www.sonic.com) is the leader in digital media software and provides a broad range of software
tools and applications for creative professionals, business and home users and technology partners. Sonic's products range from professional
DVD authoring systems and interactive content delivery technologies that are used to produce the majority of Hollywood movies released on DVD,
to the award-winning Roxio- and Sonic-branded CD and DVD creation, playback and backup applications that have become the premiere solutions
for consumers and business users worldwide. Sonic's AuthorScript® is the de facto standard for CD and DVD burning and formatting and has
been licensed by major software and hardware manufacturers, including Adobe, Broadcom, Microsoft, Scientific-Atlanta, Sony, and many others.
Sonic Solutions is headquartered in Marin County, California.
Sonic, the Sonic logo, Sonic Solutions, Roxio, MyDVD, CineMagic, Plug & Burn, LiveShare, Roxio Easy Media Creator, and
AuthorScript are trademarks or registered trademarks of Sonic Solutions or its subsidiaries in the United States and/or other
countries. Dolby is a trademark of Dolby Laboratories. All other company or product names are trademarks of their respective
owners and, in some cases, are used by Sonic Solutions under license. Specifications, pricing and delivery schedules are subject
to change without notice.