SOURCE: Burst.com, Inc.

September 25, 2006 18:51 ET

Burst.com, Inc. to Receive $858,000 in Refunds Company Will Restate 2005 Year-End Financials

SANTA ROSA, CA -- (MARKET WIRE) -- September 25, 2006 -- Burst.com, Inc. (PINKSHEETS: BRST) Chairman & CEO Richard Lang today announced that the company has filed amended tax returns and expects to receive combined Federal and State tax refunds of approximately $858,000. On March 15, 2006, Burst paid estimated tax payments to both the IRS and the California Franchise Tax Board. At that time, the estimated tax payments were based upon an "Alternative Minimum Tax" (AMT) calculation. In the process of preparing the actual returns, it was discovered that Burst qualifies for an exclusion from AMT in 2005. Accordingly, Burst expects to receive a refund of the entire amount of the Federal estimated tax payment they made on March 15, 2006 in the amount of $770,000. Further, the actual amount of calculated tax due to the Franchise Tax Board was $88,290 less than the estimated amount paid in on March 15, 2006. Thus, the combined federal and state refund to Burst is expected to be $858,290. Burst will no longer qualify for the AMT exemption for subsequent years.

The Company plans to restate its previously published 2005 year-end audited financials, upon receipt of the expected refunds, to reflect the influx of the additional capital. Lang said that the additional funds will be used for company operations and anticipates this will enable the Company to sustain its current operations, even with modest cost increases, into late 2010, without the benefit of revenues or additional fund-raising.

The Company is currently in litigation with Apple Computer. After licensing negotiations in 2005 failed, Apple sued Burst in January of this year, in an effort to have several of Burst's U.S. patents declared invalid and Apple not infringing those patents. Subsequently, Burst filed a counterclaim alleging infringement of those and additional Burst patents. Details of the litigation can be found on Burst's website: www.burst.com.

This Press Release contains forward-looking statements similar to those covered by the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. We believe that the expectations expressed herein, regarding the receipt and proposed utilization of the expected federal and state tax refunds are based on reasonable assumptions. However, these forward-looking statements are subject to numerous uncertainties and risks and actual results and developments could differ materially from these expectations. Factors which could affect our operations and prospects include the costs and uncertainties of pursuing complicated litigation and our ability pursue new or additional operating strategies. We are not responsible for updating any such forward-looking statements.

About Burst.com:

Burst.com, headquartered in Santa Rosa, California, is the developer of Faster-Than-Real-Time™ and Burst-Enabled™ video and audio delivery technology. The company, established in 1990, has built an international patent portfolio covering bursting, video delivery scheduling and Rapid-casting. Burstware®, Faster-Than-Real-Time™ and Burst-Enabled™ are trademarks of Burst.com. More information about Burst.com is available at www.burst.com.

Contact Information

  • For Further Information Contact:
    Richard Lang:
    707-541-3870