Sonic Foundry: Announces Completion of $11.25 Million Common Stock Offering

MADISON, Wis., Dec. 27 – Sonic Foundry(R), Inc. , a leader in automated rich media communications technology, today announced that it closed a public offering of 3 million shares of its common stock at $3.75 per share. The offering was marketed to institutional investors pursuant to an effective shelf registration statement previously filed with the Securities and Exchange Commission.

Robert W. Baird & Co. acted as sole underwriter for the offering.

Sonic Foundry, Inc. will use the net proceeds from the offering for support of continuing research and development efforts and capital expenditures in areas including advancement of its search technology, intellectual property protection, as well as other business development activities, working capital needs and general corporate purposes.

This news release does not constitute an offer to sell or the solicitation of an offer to buy any securities. An electronic copy of the prospectus supplement will be available on the Securities and Exchange Commission’s website at http://www.sec.gov/.

About Sonic Foundry(R), Inc.

Founded in 1991, Sonic Foundry is a technology leader in the emerging rich media communications marketplace, providing enterprise solutions and services that link an information driven world. Sonic Foundry is changing the way organizations communicate via the Web and how people around the globe receive vital information needed for work, professional advancement, safety and education. The company’s integrated Webcasting and Web presentation solutions are trusted by Fortune 500 companies, education institutions and government agencies for a variety of critical communication needs. Sonic Foundry is based in Madison, Wis. For more information about Sonic Foundry, visit the company’s Website at www.sonicfoundry.com.