BASIS OF PRESENTATION | BASIS OF PRESENTATION Organization and Pending Merger Solstice Sapphire Investments, Inc. (“Solstice” or “NewCo”), is a Delaware holding company that was incorporated on May 19, 2017. NewCo was formed for the purpose of effecting a merger of Sonus Networks, Inc. ("Sonus"), a Delaware corporation, and GENBAND Holdings Company ("GENBAND") and its two related holding companies, GENBAND Inc. ("GB") and GNBAND II, Inc. ("GB II"), pursuant to the Agreement and Plan of Merger between the parties, dated May 23, 2017 (the "Merger Agreement"). Following a series of merger transactions specified under the Merger Agreement (collectively, the "Mergers"), both Sonus and GENBAND will each become a wholly-owned subsidiary of NewCo as of the closing of the transaction. Upon the terms and subject to the conditions set forth in the Merger Agreement, former stockholders of Sonus will own approximately 50% , and former shareholders of GENBAND, GB and GB II will collectively own approximately 50% , of the shares of NewCo common stock issued and outstanding immediately following the consummation of the Mergers. The Mergers are described in the joint proxy statement/prospectus that is included in NewCo's Registration Statement on Form S-4 (File No. 333-219008) filed with the Securities and Exchange Commission ("SEC") on June 28, 2017, as subsequently amended and declared effective on September 22, 2017 (the "Form S-4"). Completion of the transactions contemplated by the Merger Agreement requires, among other things, the separate approvals of Sonus stockholders, GENBAND shareholders, GB stockholders and GB II stockholders. Sonus held a special meeting of its stockholders (the "Sonus Special Meeting") on Thursday, October 26, 2017, at which Sonus' stockholders voted to, among other things, adopt the Merger Agreement. GENBAND held an extraordinary general meeting of GENBAND shareholders on October 25, 2017, and each of GB and GB II held a special meeting of its stockholders (collectively, the "GB Special Meetings"), at which the GENBAND, GB and GB II shareholders or stockholders, as applicable, also voted to, among other things, adopt the Merger Agreement. NewCo expects that the Mergers will be consummated on Friday, October 27, 2017. As a result of the transactions contemplated by the Merger Agreement, Sonus and GENBAND will each become a wholly owned subsidiary of NewCo. The common stock of NewCo is expected to be listed for trading on the NASDAQ Global Select Market under the symbol "SONS." NewCo's principal executive offices are currently located at 4 Technology Park Drive, Westford, MA 01886 and its telephone number is (978) 614-8100. NewCo has not commenced operations, has no significant assets or liabilities, and has not carried on any activities other than those incidental to its formation and the matters contemplated by the Merger Agreement. As of September 30, 2017, Sonus is NewCo's sole stockholder and NewCo does not hold any equity interest in any other legal entity. Basis of Presentation and Significant Accounting Policies The accompanying unaudited condensed financial statements of NewCo have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP") pursuant to the rules and regulations of the SEC regarding interim financial reporting. Accordingly, the unaudited condensed financial statements do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with NewCo's Form S-4. In the opinion of management, the financial statements include all adjustments (which are of a normal and recurring nature) necessary for the fair presentation of the results of the interim period presented. Preparing financial statements requires management to make estimates and assumptions that affect the amounts that are reported in the financial statements and accompanying disclosures. Although these estimates are based on management's best knowledge of current events and actions that NewCo may undertake in the future, actual results may be different from these estimates. The results of operations for the three months ended September 30, 2017 are not necessary indicative of the results to be expected for any future period or the full fiscal year. NewCo's fiscal year ends on December 31, with the first quarter ending on March 31, the second quarter ending on June 30 and the third quarter ending on September 30 of each year. |