Good morning. I would like to welcome all of you here today. My name is Keith Rabin, President of KWR International. I would like to begin by giving you some background, which will be followed by a few words on Japan and the opportunities in this market for foreign investors. We will then introduce you to our keynote speakers, followed by presentations from eight companies who have traveled from Japan in the hope of attracting U.S. capital and business partners. All of these firms have already received VC funding in Japan and most have several years of operating history. This afternoon we will also have a presentation on the Japanese VC market and an interesting panel discussion on managing transactions with small Japanese companies.

For those of you who are not familiar with our firm, since commencing operations in 1996, we have been actively working with Japanese government and corporate entities to help communicate their positions on important trade, economic and financial issues. In the course of our activities we have developed many close relationships with investors, analysts, journalists, corporate executives and service professionals around the world. Many have noted that they recognize Japan’s underlying potential. But they also highlight the challenges they face in their efforts to identify and access specific opportunities that offer the potential to improve their investment and corporate performance.

With this in mind, we began seeking ways to assist in this process and the result is our meeting today.

Why Japan? I am sure all of you are well aware of the seemingly endless flow of negative indicators and media coverage concerning developments or the lack of developments in Japan today. Even though I spend a lot of my time defending the Japanese economy, I am not going to try to dispel the essential need for change or to argue that Japan does not face serious problems.

The situation, however, is far from simple and I will tell you that Japan’s current economic problems are the source of many attractive investment and business opportunities. Even with its current problems, Japan remains the world’s second largest economy and according to the office of the USTR, the third largest trading partner of the United States, accounting for well over $250 billion in two-way trade in goods and services. It possesses one of the largest pools of savings in the world, has a well-educated work force and one of the highest standards of livings of any country. Additionally, for all the talk we hear about China and other emerging markets, Japan dwarfs the rest of Asia by a large margin, whether we are talking of market cap, GDP size or almost any other measure. It also represents an extremely large, well-established, sophisticated and attractive consumer and industrial market, particularly for the high-end products and services produced and offered by U.S. firms.

When viewed from the perspective of a U.S. corporation or investor, there is a very positive side to current trends in Japan. Whereas the U.S. has been actively engaging in deregulation and corporate restructuring and reorganization for about twenty years, Japan has all or most of its gains before it. Therefore, while the U.S. economy is now showing some glimmers of hope, with many analysts now forecasting an end to our current recession, few if any believe we will see anything remotely approaching the heady growth we enjoyed until about a year and a half ago. Japan, however — once it begins to pick up more rapid momentum in the areas of banking and corporate reorganization — and to move past important political and social barriers -- has far more potential for rapid appreciation. To give one indicator of the possibilities, in 1982 the year Former U.S. Treasury Secretary William Simon initiated an LBO of Gibson Greetings, which many acclaim to be the start of U.S. restructuring efforts, the Dow Jones index stood at about 800. More than a decade later in 1995, before the start of the speculative dot.com era, it had appreciated to over 5,000. This was largely driven by restructuring, reorganization and introduction of technological and other efficiencies — the same type of measures now being urged on, and beginning to rake root in, Japan.

While it may be early to allocate capital to the macro indices, it is clear there are many micro opportunities emerging. In many cases, it is the problems themselves that are leading to the opportunities. This is where we would like to focus your attention today. For example, pessimism about the future has resulted in a delay in marriage and birth rates in Japan. While this has troubling implications over the long term, it has led to a rapid rise in disposable income among Japanese singles, many who still live at home and young couples, who fit the DINK (Double Income, No Kids) profile desired by so many purveyors of upscale consumer products. Many of you are also aware of the problems presented by Japan’s rapidly aging population. This is giving rise to amazing opportunities in the areas of medical equipment and technologies and geriatric care. Women are also taking on an increasingly important role in the workplace.

Information technology is another important area. Japan was late to embrace the tech boom that engulfed the U.S. in the late 90s. It just started to take off when the NASDAQ cratered a year and a half ago. The introduction of low-cost ADSL access last year, however, which I am told is selling for a monthly fee that is lower than what is commonly available in the U.S., is leading not only to high growth in broadband penetration. It is also contributing to dramatic increases in the time that subscribers are spending online and rapidly accelerating the demand for web services, e-commerce and other technologies and applications that have already achieved a degree of maturity in the U.S. Additionally, there are many opportunities to replicate business models, that have achieved success in the U.S. to achieve greater economies of scale and additional revenue sources in Japan, where a ready market of high-income consumers awaits them.

Japan is also in the midst of producing many attractive technologies, applications and products in its own right. Wireless is one area where Japan leads the world, and you will soon hear from a representative from Japan’s leading company in that sector. Additionally, we are only just beginning to enter into the age of convergence and the birth of Internet appliances. This is only one area where it would be foolish to discount Japan’s capabilities and potential.

Japanese companies and consumers are also far more open than ever before to the entry of foreign firms and investors in their market. Only ten or even five years ago, Japan remained eager to go it alone. They are now keenly aware of the need for change if they are maintain and expand their economic viability.

One can argue over the pace of progress and the need for more rapid reform, however, it is most important to recognize the tremendous shift of sentiment within Japanese businesses and consumers. This offers tremendous opportunities to U.S. corporations and investors. Most important is a willingness to identify the underlying potential of a particular firm and sector and to work to introduce the company-level improvements needed to allow for rapid appreciation.

Those of you who are familiar with Japan are well aware of the concept of "gaiatsu". This basically calls for Japanese efforts to entice foreign demands on Japan which invite reform and other measures that Japanese politicians and bureaucrats are not able to introduce by themselves for political and social reasons. Over the past few years a tremendous rise of foreign investment has begun to contribute to what I would call a rise of "corporate gaiatsu" in Japan. This is helping to introduce change on the micro level. Over time it will impact entire sectors and the Japanese economy at large. One might view the Renault-Nissan, Ripplewood-Shinsei or WLRoss-Kansai Sawayaka deals in that light.

I would like to view our event today as a further acceleration of this activity and the start of a dialogue between small- to mid-sized Japanese companies and U.S. investors, executives and the service community. The companies you will hear from today all show promise and potential and are in a sense pioneers — who recognize the essential need to internationalize their operations and capital structure and to travel to New York to tell their story. They are to be commended for exposing themselves to the scrutiny of this demanding audience. While this is quite common in the U.S., it is relatively unknown in Japan, where companies have traditionally relied upon debt financing from commercial banks, rather than the VC- and equity-oriented approach that has taken root here.

Japan has been far slower to reward entrepreneurship, possessing a lower rate of business openings and closings than the U.S. There are many reasons for this, which go beyond the scope of this discussion, but the fact remains many of the regulatory barriers that have contributed to this deficiency have, or are now being addressed. We are beginning to see encouraging signs of change — with this event and the entreprenurial spirit of the companies that will be presenting being only one small indicator.

Therefore, I would ask that you listen to the companies we have assembled, ask questions and meet with them one-on-one, not only to discuss their underlying businesses, but to engage in "corporate and investor gaiatsu" in which you communicate the concerns and demands you have as potential investors and potential business partners. Through an honest and fruitful dialogue of this nature, we hope to develop many mutually-rewarding investment and business relationships moving forward, not only at this event, but in many others over the months and years to come.

Before concluding, I would like to again thank you for your participation. I would also like to thank Sonnenchein Nath & Rosenthal and Deloitte Touche Tohmatsu for sponsoring this event,as well as Tsunami VC and all of the companies who have traveled here from Japan today. I would also like to thank our speakers, Mr. Nobuharu Ono, President & CEO of NTT DoCoMo USA and Richard Katz, Senior Editor of The Oriental Economist Report. In addition, our supporting media partners which include: The Asian Wall Street Journal Weekly Edition, Asia Times Online, Asia Today International, Buyside Magazine, The Daily Deal, INT Media Group, J@pan Inc, Japan Technology Alert, KWR International Advisor, Silicon Alley Station, Site-by-Site, Venture Reporter and vFinance.com. Additionally, I would like to recognize Morgen Even & Co., our partner in organizing this event, as well as all of the KWR consultants and representatives who have contributed above and beyond the call of duty to help in organizing this project.

Thank you.