Conclave Group is a direct marketing service company that has developed a proprietary distribution network designed to connect national retailers and service providers with the hard-to-reach apartment renter community.  Conclave works by developing a consortium of landlords who provide Conclave access to renters via delivery of a magazine that contains everything a tenant needs to know and do in order to successfully complete his or her move (from change of address form, to box orders, to new phone or cable service, to renter’s insurance).  In 2003 Sonostar was the lead investor in the company’s initial capital raise.

DoubleAgent was a new interactive search engine and information organization portal that has patented search and session mapping technologies designed to significantly enhance user’s experience as they search for and store information on the internet.  Sonostar provided the seed capital to Double Agent in March 1999.  Although the company successfully completed two additional rounds of financing at valuations higher than our original investment, it was unable to continue raising capital and the company shut is doors in August 2001.  The company successfully sold its patent portfolio in 2004, returning a portion of the initial investment to investors.

Gardenstate Brickface is the most experienced and service oriented residential and commercial remodeling company in the tri-state area.  Ranked No. 30 in the top 500 remodeling companies in the country, Garden State was awarded the 2003 Contractor of the Year Award by the National Association of Remodeling Industry.  Sonostar invested in Garden State in 1998 and has made follow-on investments as the company expanded into the sunroom and custom-made windows businesses.  David Moore is chairman of the board of directors of Garden State Brickface.

Keryx is a biotech company which recently completed enrolling patients in its Phase III clinical trial for its lead drug compound, sulodexide, a drug that has shown exciting preliminary success in the treatment of kidney disease in diabetics.  Sonostar was the lead investor in the company’s second round of financing in December 1999 and has participated in additional follow-on capital raising transactions.  Keryx successfully completed its IPO in July 2000 and is currently traded on the NASDAQ under the ticker KERX.  In February 2004, Keryx acquired Access Oncology, thereby adding three clinical stage oncology drug candidates to its pipeline.  Keryx anticipates that the results for its Phase III trial for sulodexide will be announced in the 4th quarter of 2007 or early in 2008.

Evaliant is an advertising monitoring service that provides real time advertising tracking on the internet.  The company’s reports capture and categorize ads and analyze data with respect to where and when ads appear, what the ads look like and what the audience size and media value is, at sites representing more that 90% of web ad spending.  Sonostar was a founding investor in 1998.  Though the company completed additional funding rounds at multiples of our original investment, the company, was sold to CMR in July 2002 at a discount to the value of our investment.

Through its exclusive relationship with NetJets, the premier fractional jet ownership program in the United States and Europe, Marquis offers a pre-paid annual lease of 25 hours or more of occupied flight time on aircraft ranging from the Citation V Ultra to the Gulfstream IV.  There are no long term commitments, no monthly fees and no hourly usage charges( other than fuel surcharges).  One comprehensive fee paid up front gives the Marquis Jet card holder access to the jet of his or her choice at any time on as little as 10 hours notice.  Sonostar invested in the initial funding round of Marquis in December 2001.  During the third quarter of 2003, the company sold its 1000th twenty-five hour card.  Sales revenues for 2003, Marquis Jets' second full year of operation, exceeded $125 million, making Marquis one of the fastest companies ever to achieve that sales milestone.  Sonostar exited its position in Marquis Jets in early 2004 by selling its stake back to Marquis' management in a management led buy out.  Sonostar realized a substantial gain on the sale of its stake.  Until the time of our sale, David Moore was vice chairman of the board of directors of Marquis.  The Sonostar principals intend to continue their relationship with Marquis Jets as customers of the Marquis Jet card program.

Paradigm was a direct marketing company that markets subscription services to consumers for large brands, including AT&T, AT&T Wireless, Qwest, Protection-One, E-Trade, Progressive Insurance, Direct TV and others.  In the spring of 1997, Sonostar and its principals provided the seed capital to Paradigm.  In April of 1999, Western Resources, a Kansas based utility holding Company invested $32 million for a minority stake in the company.  The Company was subsequently sold to Mosaic Group in Canada for a valuation in excess of $200 million.  David Moore was chairman and Greg Kiernan was vice chairman of Paradigm.  Greg Kiernan served as a member of the board of directors of Mosaic and was subsequently hired as a financial advisor to Mosaic.

Quadrangle is a private investment firm that invests in private and public media and communications companies in the United States and Europe through a $1 billion private equity fund.  The principals of this fund are highly regarded professionals who are well known to Sonostar’s partners.  Each of the principals has unmatched industry experience, knowledge and relationships.  Sonostar has been an investor in the fund since its inception.  We believe that our relationship with Quadrangle will provide us with strong financial returns as well as access to industry expertise and potential deal flow.

U.S. Home Systems is one of the largest home remodeling companies in the country, with branches in 15 major metropolitan areas in the United States.  The company specializes in kitchen remodeling (operating under the Century 21 Home Improvements and Facelifters brand names), windows (operating under the Renewal by Andersen banner), bathrooms and outdoor decks.  In addition, the company operates its own wholly owned consumer finance business through its subsidiary, FCC.  In the spring of 1997, Sonostar and its principals provided the original financing for US Remodelers, the predecessor company, to purchase certain assets out of bankruptcy.  In 2001, the company came public in a reverse merger.  It is now traded on the NASDAQ under the ticker USHS and has a market capitalization of more than $100 million, in excess of thirty times the original valuation of the company when we invested.  Until the time the company came public, David Moore was chairman of the board and Greg Kiernan was a member of the board of directors.  Sonostar exited its position in USHS in the third and fourth quarters of 2003, realizing a substantial gain.

Wintegra is a "fabless" semi-conductor company that provides a family of single chip solutions that enables the next generation of access networks to converge voice and data infrastructures.  Wintegra has more than one hundred design wins with numerous customers including many of the largest communications companies in the world.  Texas Instruments is a major equity investor and customer.  Sonostar participated in both the second and third financing rounds.  The company reached operating profitability in the second quarter of 2005, and since that time has had an uninterrupted series of consecutively higher quarterly revenues and profits.  The company expects to seek an initial public offering in mid to late 2007.  Our investment is largely a result of our strong professional and personal relationship with the largest investor shareholder.