June 2004

Based in Marin County, California, Sonic Solutions (SNIC) is the world's leading supplier of DVD creation software for professional, industrial and consumer applications. The majority of major film releases on DVD have been produced on Sonic's professional DVD authoring systems in studios around the world. Sonic's MyDVD® and DVDit® are the most widely used DVD creation applications by consumers and video enthusiasts and are the solutions of choice among the key PC and after-market drive suppliers. Sonic's RecordNow!(TM) is a leading solution for audio and data mastering. InterActual, a subsidiary of Sonic Solutions, is the leading provider of software and services that enable cutting-edge DVD interactivity in computers and next-generation home entertainment platforms. Sonic's AuthorScript®, the DVD and CD formatting and burning engine that underlies Sonic's applications, is the most widely deployed DVD software engine and has been licensed by Adobe, Microsoft, Sony and many others.

Source: Sonic Solutions

Rocket Capital Checklist for Sonic Solutions

Rapid revenue and earnings growth

Revenue growth of 71% in 2003 and estimated 70%+ in 2004
Earnings growth of 100% for the last three quarters and estimated 100%+ for full year 2004

Obvious leader in its category

Dominant market share and the first choice for all DVD formatting and burning needs

Competitive edge within its sector

AuthorScript technology is best in its class confirmed by licensing contract with Microsoft and partnership with Dell

Keep it small – greater upside potential

$500 million market cap and 21 million shares outstanding

Economic effects of supply/demand

38% institutional ownership

Technical analysis to decide timing

Broke out of a lengthy "base on base" pattern featuring 4 times better then average volume with a close above $21

As of the time of this post, clients of Rocket Capital Management own approximately 45,000 shares.

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