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Filed Pursuant to Rule 424(b)(3)
Registration No. 333-50697
SONIC SOLUTIONS
PROSPECTUS SUPPLEMENT NO. 3
The attached prospectus, dated April 29, 1998 (the "Prospectus") relates to
the resale of shares of Common Stock of the Company issuable upon conversion of
shares of Series C Preferred Stock owned by the Selling Stockholder (the
"Shares"), which such Selling Stockholder acquired pursuant to a Private
Securities Subscription Agreement between the Company and the Selling
Stockholder dated as of March 31, 1998 (the "Subscription Agreement"). On
October 30 and November 2, 1998, the Company issued to the selling stockholder a
total of 125,435 shares of Common Stock of the Company by way of conversion
of 125,000 shares of Series C Preferred Stock. On February 3, 4, 5, 8 and 9,
1999, the Company issued to the Selling Stockholder a total of 42,672 shares of
Common Stock of the Company by way of conversion of 42,500 shares of Series C
Preferred Stock. On September 22, 1999, the Company issued to the selling
stockholder a total of 15,207 shares of Common Stock of the Company by way of
conversion of 15,000 shares of Series C Preferred Stock.
Also attached are the previous prospectus supplements to the Prospectus
dated November 5, 1998 and March 5, 1999. See "Selling Stockholders" in the
Prospectus which is hereby updated by this Prospectus Supplement, as follows:
SELLING STOCKHOLDER
The following table sets forth certain information regarding beneficial
ownership of the Company's Common Stock by the Selling Stockholder as of
September 30, 1999. Because a Selling Stockholder may sell some or all of the
Shares offered hereby, and because there are currently no agreements,
arrangements or understandings with respect to the sale of any of the Shares, no
estimate can be given as to the actual amount of Shares that will be held by the
Selling Stockholder after completion of such distribution. See "Plan of
Distribution".
<TABLE>
<CAPTION>
Common Stock Common Common Stock
Beneficially Owned Stock Beneficially Owned
Prior to Offering(1) to be sold After Offering
-------------------- ---------- --------------
Number Percent(2) Number Percent(2)
------ ---------- ------ ----------
<S> <C> <C> <C> <C> <C>
Hambrecht & Quist Guaranty...... 585,706 5.7% 271,760 313,946 3.0%
Finance LLC
One Bush Street
San Francisco, CA 94104
TOTALS:......................... 585,706 5.7% 271,760 313,946 3.0%
</TABLE>
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(1) In addition to the Shares, the Selling Stockholder is deemed to
beneficially own (i) 250,000 shares of Common Stock issuable upon
conversion of additional shares of Series C Preferred Stock that Selling
Stockholder acquired pursuant to a subscription agreement between the
Company and the Selling Stockholder dated as of October 15, 1999, in
accordance with the conversion rate set forth in such agreement,
(ii) 160,100 shares of Common Stock issuable upon exercise of warrants held
by such Selling Stockholder (see "Description of Capital Stock") and (iii)
222 shares of Common Stock.
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(2) Applicable percentage of ownership is based on 10,331,864 shares of Common
Stock outstanding as of September 30, 1999.
The Shares offered hereby by the Selling Stockholder were or are to be
acquired by way of conversion of the Series C Preferred Stock which such Selling
Stockholder acquired pursuant to the Subscription Agreement. Under the
Subscription Agreement, the Selling Stockholder represented to the Company that
it was acquiring the shares of Series C Preferred Stock from the Company without
any present intention of effecting a distribution of those shares. However, in
accordance with the Subscription Agreement, the Company agreed to register the
underlying shares of Common Stock issuable upon conversion of the Series C
Preferred Stock held by the Selling Stockholder, for resale by the Selling
Stockholder to permit such resales from time to time in the market or in
privately-negotiated transactions. The Company will prepare and file such
amendments and supplements to the registration statement as may be necessary in
accordance with the rules and regulations of the Securities Act to keep it
effective for a period of approximately two years.
The Company has agreed to bear certain expenses (other than broker
discounts and commissions, if any) in connection with the registration
statement.
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The date of this Prospectus Supplement is October 18, 1999.
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