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SHH Sonomax Technologies

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Share Name Share Symbol Market Type
Sonomax Technologies TSXV:SHH TSX Venture Common Stock
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Highlights From Sonomax's Annual General Meeting and June Monthly Update Conference Call

02/07/2008 4:32pm

Marketwired Canada


Sonomax Hearing Healthcare Inc. (TSX VENTURE:SHH) is please to provide a summary
of the highlights of the AGM held on June 26, 2008 and the Monthly Update
Conference Call held on June 27, 2008.


Highlights

There were over 100 attendees at this year's AGM that lasted two hours and
thirty minutes: Here are some of the most salient points:


Sonomax introduced the framework of managing the business using the 5 Ps model.
The 5 Ps are: People, Profitability, Products, Potential and Predictability. The
Company will continue to develop and enhance its business plan using this
framework.


Dan Casey, Sonomax' CEO provided the following insight pertaining to each "P"
and where the company is today:


People - The Sonomax team is a group of focused, dedicated and persevering
people that are embracing the change the company is currently undergoing.


Profitability - The Company has not been there yet but has a detailed plan in
place to show improvements on a quarter to quarter basis. It is anticipated that
the company will get to positive cash and breakeven sometime in the first half
of 2009. The Company is preparing a business plan with the long term objective
to reach a $25 Million sales target in 2011.


Products - Sonomax has four products that are the main focus for 2008 and 2009.
They are:


1) Hearing Protection Devices (HPD) - SonoCustom(TM) - this product is mature
and of the highest quality and best of class. It is showing quarter to quarter
growth and penetrating new customers every month


2) Proof of Performance Software - SonoPass(TM) - the only objective testing
software to measure the attenuation level of any HPD. Sonomax's strong IP
position provides the company with a significant competitive edge and as this
product is embraced by more and more companies it will become an important
revenue stream


3) MP3 Earphones sold under the brand Soundcage(TM) - the Soundcage(TM) products
have great potential and the balance of the year will be used to finalize the
channel strategy for these products and


4) Push To Talk - the communication headset used for two way radios that allows
wearers to talk and listen through the earpiece. The product is being test
marketed in Europe and we are confident that it will be another winning product
for Sonomax.


Potential - During the May 28, 2008 conference call the potential of each
product line was explained. The Company is playing in areas of great potential
with very little market share. The upside is significant.


Predictability - This P has not been strength in the past and will improve as
the Company obtains the necessary data to improve its decision making and create
a more efficient supply chain. Great progress has been made so far. It is
expected that by the end of Q3-08 the sales forecasting element will be a tool
that can used to plan production, optimize inventory turns and increase the
company's working capital.


An update pertaining too many of the actions that have taken place since the
beginning of the year was provided. Some of those highlights are:


- Channel inventory has been reduced by 50%;

- Finished Goods inventory will be reduced by 50% by early part of next year;

- The Company has reduced expenses and consequently the cash burn is down by
about 50%;


- The sales to Vitasound will start in late Q3-08 as they start successfully
penetrating the hearing aid market;


- The sales team is being built, sales process are being developed and being
implemented. This is one of the key elements of the success of Sonomax going
forward;


- Overall company and department objectives are in place and tracked regularly.
This is an essential management process to ensure that the company executes in a
timely fashion;


It was repeatedly stressed that the company clearly understands its number one
priority is to get to positive cash then breakeven and then profit.


The Company will make progress in Q2-08 over Q1-08 and it is working diligently
to achieve its objective of quarter to quarter improvements. The second half of
the year will be better than the first half.


The company is growing with its licensee network in Europe and Australia and is
struggling in North America. MSA in South America has finally received the CA
certifications for Brazil and is ready to start selling. The company is
optimistic that it should see some reasonable progress by the end of the year.


Overall, the organization must execute on the following items over the short term:

1. A focused organization on the top line;

2. Consistent and conservative cash management;

3. Aggressive pursuit of any areas related to margin improvement and cost reduction;

4. A rapid and significant improvement in the sales situation in North America;

5. The proper level of funding for the next 6 quarters;

The summary of the material presented ended with an explanation as to why the
Sonomax team is very confident. The reasons are: a) New management team that has
a proven rack record in sales, operations, supply chain and the execution of
objectives within a business plan, which will be complementary to the founders'
vision and success in developing best in class products; b) Organization changes
and processes are now in place and working well;  c) The company has great
products., They are unique with strong IP protection and limited competition and
d) A plan is in place, there will be focused execution and the organization will
hold itself accountable on a daily basis.


In addition to the above items, Bruce Jones the new Sonomax VP of Sales and
Marketing presented a summary of his sales strategy and processes for the
organization.


Summary

The company is excited by its potential in growing market segments and will
execute to the plan in place. It is focused on the top line and will make
Sonomax a great company. As previously mentioned it will take time. The company
thanks all the shareholders for their patience and continued support.


About Sonomax

Sonomax Hearing Healthcare Inc. is a leader in the development and manufacturing
of intra-ear technologies. The company's patented custom-fit, instant-fit
expansion earpieces deliver a perfect acoustic seal every time and can be
certified by SonoPass(R), the company's proprietary, computer generated
proof-of-performance software. Building on its technology leadership in hearing
protection, Sonomax has expanded the applications for its technologies into high
growth consumer products such as MP3 audio, multi-media and gaming earphones and
custom earpieces for other applications such as Bluetooth(TM) cellular headsets
and hearing aids.


This news release contains certain forward-looking statements that reflect the
current views and/or expectations of Sonomax Hearing Healthcare Inc. with
respect to its performance, business and future events. Such statements are
subject to a number of risks, uncertainties and assumptions. Actual results and
events may vary significantly.


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