Magnetic Laboratories Co., Ltd.

CORPORATE PROFILE

January 2010

Corporate Info

Name: MAGNETIC LABORATORIES CO., LTD. Establishment: March 1979. Capital : JPY450,000,000 Annual turnover : FY2007 JPY 7.7B

　　 　　 FY2008 JPY 8.3B FY2009 JPY 10.0B

FA2010 JPY 20.0B (Forecast)

President / CEO: Kuniyuki Saito Number of staff: 100 Main Bank: Mitsubishi Tokyo UFJ Bank / Mitsui Sumitomo Bank Mizuho Bank/Yokohama Bank/Shoko Chukin Trading Products: Memory recording media products Flash memory Internet Security Devices Portable application PC peripherals & accessories Enterprising Duplication Re-Pack for Outlet. Headquartes: 1-17, Sakumacho, Kanda, Chiyoda-ku, Tokyo 101-0025 Japan Tel: +81-3-3253-5811 Fax: +81-3-3253-5815 http://www.mag-labo.jp

　　　　　　　

Network

Duplication Center ： 4-23, Katayama Building, Kandasakuma-chuo,Chiyoda-ku,Tokyo TEL: +81-3-3865-4632 Osaka Offic 4-2-21, Minamihonmachi, Chuuou-ku, Osaka-City TEL: +81-6-6253-1755 FAX: +81-6-6253-1756 Fukuoka Office ： 7F, Fukuoka Fuji Building, 2-8-49 Tenjin, Chuo-Ku, Fukuoka-City, Fukuoka TEL: +81-92-716-7678 FAX: +92-92-716-7681 Disty Center ： c/o Fukuyama-Tsuun, 3F,1-13-6 Shinsuna, Koto-Ku, Tokyo TEL: +81-3-5632-1451 FAX: +81-3-5632-1452 Outlet Center ： 15-1, Honda Oaza Kitashinoyamazaki, Kazu-City, Saitama

TEL: +81-480-68-5488 Dubai Office ： 153, Techno City, Al Khaleej Centre, P.O. Box 51779, Dubai,U.A.E. 　 TEL: +971-4-359-1972 FAX: +971-4-359-1975 Taiwan Office ： 5F, No249, Guangming 6th Rd, Jhubei City,Hsinchu County 302 Taiwan

　　　　 TEL & FAX: +886-3558-6148 Israel Software Development Center: Profit House, 6th Floor2 Yagur Street, Haifa 32626 Israel TEL: +972 4 832 0555 FAX: +972 4 832 0550 Korean IT Solution Center: TEL: +82-2-568-5744 FAX: +82-2-568-5895

Head Office Osaka Office

Fukuoka Office

Distribution Center

Dubai Office Taiwan Office

Korea OfficeIsrael Office

Outlet Center

Duplication Center

Business Outline

We are one of the largest wholesaler share for the line of products of FD,CD-R, DVD-R, Flash memory and duplication business in Japan.

We have opened the market for the portable application business, character item Businesses in 2009.

Our initial target is 15% share in the Japanese market.

FD ・ MO ・ MD ・ CD/-R/-RW ・ DVD/±R/±RW/RAM/DVD for the next generation, Flash memory card 、 Video tape 、 Media Copy Protect item, Duplicator

Digital Photo Frame, PC Accessories Case for the Media etc…

Taiyo-Yuden ・ Mitsubishi kagaku media ・ MAXELL ・ SONY ・ IMATION ・ TDK ・PRINCO ・ BENQ ・ CMC ・ UMEDISC ・ RITEK ・ OPTODISC ・ GIGASTORAGE

KingMax ・ AXXEN ・ ejector ・ HexaLock ・ AllPro 、 TrusCont 、 Kodak MediaChilin 、 Kodia 、 Seahan Media,Nexcopy 、 Nanovision 、 Amstar Technology

Each Major retailers,wholesalers, Home center (DIY stores?), record companies, Major corporation, the Imperial Household Agency,

Post pro function…etc

Main Products

Manufacturers

Main businessAccounts

Trading House for Media Products

Business structure

・ The Biggest share in Japan.・ Expand sales in overseas ・ Development of security related products ①Meet the diverse needs of customers. ②Handling various services ③Developed many PB brands.・ Selling items largely increased with the collaboration of manufacturers. ・ Portable applications for USB memory have a great demand.・ TurboVaccine （ Anti-Virus ）・ Perfect Eraser （ deleted file ）・ Raviro （ sending/receiving email ）

Wholesale business and the media, like the foundation of our business can provide the solution for duplication. ・ copy and protect for memory media, creating contents (USB memory,DVD-R,CD-R,Flash memory etc…)

Flash related services

Copy Protect

Solution Service

Duplication

Wholesale Media

Duplication Service

Equipment sales

We are the largest media enterprise in Japan, handling all sorts of memory media products.

We sell flash memory, USB memory, PM3 player, floppy-discs, video tapes, digital photo frame, pc accessories, photo accessories, duplicator, potable application etc.

OEMWholesale

CD 、 DVD 、 Blu-Ray 、 Flash memory

・ The biggest Duplication store in Akihabara Tokyo Japan.Making Blu-Ray, DVD outsoursing, MPEG, encode,mobile contents and flash memory copy service.

Wholesale Business Media

Wholesale media transaction is the core business of our company. Most media related products are available from the various manufacturers. To extend market share, we have started application for CD-R,DVD-R development.We have a large selection of items available in our inventory in Japan.We can offer media related products to every needs.Please consult with us for the production of numerous private media items. We sell flash memory of Kingmax company (Taiwan), characterised USB items of AXXEN company (Korea).

If you need Special media, discontinue media, please ask us, we can procure with our network.. ■ FD■ Video tape■ Discontinue CD-R 、 DVD-R■ Copy protect CD-R 、 DVD-R 、ＵＳＢ

Our collaboration brand has a many sort of Flash memory products. We will give you special price for large amount of order.

Flash memory-related products improved.Please leave to us all your needs about media.

Flash media sales

We are the sole agent of Kingmax (A Taiwanese company) , sales and marketing of KINGMAX brand products Flash Memory mainly in the Japanese market. We invested to Kingmax in December 2009, increasing Japanese market share and also planning to open a Kingmax shop in Akihabara district.

We are the Japanese agent of AXXEN (Korean company) and selling USB memory, MP3 Player as a sole agent in Japan.July 2008, We invested to AXXEN and developing product for Japanese market.Korean factory is an OEM for our brands USB flash memory.

KINGMAX, AXXEN USB memory for security purpose, and also software utilities are available.

Portable applications business

Market has been increasing every year because of higher capacity of memory card and lower prices. USB memory are easy to carry but if you lose, it`s may caused Information leakage. ‘USB memory and Security’ they are going to be very important subject. Our USB memory is available to various security software.

●Utility software can be downloaded free.●Software support for copy program contents,program files.

From last year virus are spread through the medium of USB memory, users want to sort this matter. We are selling Tarbo Vaccine that is virus protection software pre-installed on USB memory.We also have ‘Perfect Eraser’ that is Software for deleted HD files permanently and ‘Raviro’, that is USB memory that can receive web-mail and POP mail form USB memory.

We will develop various portable application for USB memory. To start the application from the USB memory-it’s already popular in abroad and this year, surely will popular in japan.

Application Business Media

PC users are increasing every year, because the prices are decreasing constantly. Most of the user are receiving/sending emails, downloading music and transferring/saving pictures from digital cameras regularly. Many users should have a problem because computer hard drive quickly fills up, especially backup emails are not easy for most users. We believe that there are users who wants to save/receive e-mail confidential files and computer-generated to DVD-R not to Hard Disk. We sell back-up pre-installed software for CD-R, DVD-R, USB media products.

① file backup CD-R ②e-mail backup DVD-R ③Backup file encryption DVD-R

Enter password, keyboard input is available to prevent hacking software Each media contains burning software.

Anyone can save the file from hard disk to CD-R, DVD-R, and be encrypted.

Monitor accessories

Due to becoming very smaller, diversified application, a lot of information do not fit on one screen. In 2009, we have succeeded further strengthen this new business for the smaller monitor. We haveincreased the sales growth of the portable touch panel monitor to the SI traders.

Digital Photo Frame selling since 2006. We are selling products suitable design, features for Japanese user. The model can also transfer pictures from mobile phones to digital photo frame in 2010 may come to appear.

second monitor small USB Products

Digital Photo Frame

Nanovision (Korean) General Agent

Digital Photo Frame

Collaboration Business OEM

For the larger order of CD-R, DVD-R media, Flash memory products, we will offer you OEM Special Price. If you are looking for more cheaper prices compare to your current buying prices and also find difficult to negotiate with foreign manufacturers, then you can do that by the collaboration with us.Please let us know your required quantity with prices, then our staff will negotiate with the overseasmanufactures on behalf of you. There will not be any extra cost for the importation, because importation is our daily routine work. So,you can save a lot of money for the OEM business.For the OEM business, usually we charge lowest only 5% (cost +5%)We can cooperate each other increasing the amount of purchase and it makes cost price down and we will be more stronger competitiveness in the market.

CD-R, DVD-R ： Minimum order 1 lot (20 feet container)10P Case Box: 　 about 270,000 pc50P Case Box: 　 about 405,000 pc

USB memory or Flash memory cardWe can offer special price for a large volume order.

Duplication Outlets

We started the cheapest price in the industry, for the next generations DVD service. . ■Blu-Ray duplication From JPY 2,000 ■Blu-Ray authoring From JPY 50,000

Blu-Ray Duplicator

＊ Our duplicaton center is the biggest in Akihabara district.We support all duplication, CD-R, DVD-R, Flash memory, USB memory also Blu-Ray ・ DVD authoring ・ MPEG encode.

• From DV, Digital Beta-cam, HD cam tape to MPEG-1, MPEG-2, MPEG-4,

• Video Converter can be finish high quality at our editing studio.

• Support for mobile telephone and video encode service.

We have copy protect duplication service for contents file, program file, CAD file etc…

We are specialist at copy protect, leave us copy protect services.

Services convert Video files

Copy Protect USB

Flash memory-related services

It is becoming normal to play videos from Deliver contents which using Flash memory card instead of CD, DVD / Download service / Portable multi media and digital frame In 2009 we will also focus on flash media-related services.

Video file Convert service

USB application

FlashDuplication service

From DV, Digital Beta-cam, HD cam tape to MPEG-1, MPEG-2, MPEG-4, Video Converter can be finish high quality at our editing studio.

SD Video encode for mobile telephone

Develop for KINGMX, AXXEN USB memory for application software. Virus check, send / receive mail, file encryption, Password, PC-Lock, album USB, file deleting application 、ＣＡＤ file protect

Duplication service of Flash media has been increasing every year.images, videos, programs, and can accommodate a variety of formats.

Support for writing of CPRM / copy protection.If you use our flash memory, can reduce cost a lot.

We also selling memory duplicator.

Flash memory CPRM writing service

Copy Protect service

Leaking personal information is increasing every year, it is a big social problem.

We are started copy protect service for each media and deal copy protect support media in 2008.

Our CD-RX Media is the best for Copy protection for information technology,educational content

and program files

DVD video, program files, the file content ofCopy protected. （ Video,MP3,Flash etc… ）We offer multiple solutions for every case.

We offer 2 type of protections.TSFD Copy Protect - Program install to USB pen drive.

Sell/distribute to users. Secure-I –who concern to security.

CD-R 　Copy Protect

DVD-R 　Copy Protect

USB pen drive Copy Protect

Duplicator Sales CD/DVD±R Duplicator Copy Protect Business

We are also selling duplication machines which is same as duplication center. We can recommend to our customers to find best equipment from our experience.

RimageDuplicators for CD-R 、 DVD-R 、 Blu-RayCompatible with CD-R copy protect 、 DVD-R copy protect

Otari VDP-116 CD/DVD±RDuplicator

The best for large quantities copy

AllPro CD/DVD±RDuplicator

CD ・ DVD labelPrinter

Label printer with revolutionary three in one inkjet printer.Up to 600 discs can be loaded. Corresponding to five hours of continuous operation.

16 drive high-performance continuous operation CD/DVD±R Duplicator CD-R ： 110MB data: 16 speed 776 pieces / hour

DVD-R ： 1GB data: Approximately 100 pieces / hour for a copy of

CD/DVD±R Duplicator for 2 to 9 drives withautomatic loader depending on applications

Otari LP-3 CD/DVDLabel brinter

Suitable for large quantities label print.

Rimage Duplicator

Flash Memories/USB Pen Drive Duplicators

Started duplication services by introducing flash memories duplicators from Germany in 2005.Increased users who need flash memories duplicators for large quantities of copies forMobile phone, portable AV equipment with flash memories.

Protects for USB Pen Drive copies.Trend to sell and distribute USB Pen DriveIncorporating contents.Forecast to increase

Import and sales of flash memories & USB Pen Drives.Provide brands collaborating with the overseas vendorsFor flash memories and duplicators.Developed duplication software for USB protects.

License to use software available.

Prepared various duplicators for various flash memories.

Provide products support after sale by customers.

Duplicators with high end memories

Duplication software for copy protects

Protects for USB Pen Drive copies.Trend to sell and distribute USB Pen DriveIncorporating contents.Forecast to increase issues of copy protects forcontents as well as CD & DVD, USB copy protectsSoftware available.We are its solution provider in addition to sales ofDevices.

Application License Business

Developing various applications for CD-R / DVD-R / USB memories.License solutions available for customers who need to incorporate our applicationsinto users products.Our sales channels available for customers who already developed its software.

Applications for licenses

■Turbo Vaccine: Virus guard software■Perfect Eraser ： Software to delete all files completely■Music Q ： Music and video replay viewers■Album Slide Show ： Software for still images■File Distributors ： Software to distribute files■Secure-I ： Contents file copies protect software■TSFD USB,Secure-DVD-R ： Contents & programs file copies protect software■Raviro USB ： Software for email transmitted and received

Web sales and Shops

Web sales started from 2008 and increased in 2009 from the web sales business. Some original products are available with us, those are not available to the other competitors. There is a possibility for new customers from BtoB.

Outlet shops located in the headquarter, provides various products, new items will be added with great services.

ソリューション

Classifications

･ DLT Data Cartridge for large memory DUD master applications･ Super DLT Data Cartridge for 110GB memory・ LTO Ultrium Data Cartridge for 1TB next generation back-up media

•SD Cards•Micro SD cards•USB memories•Smart media•Compact flash•Memory stick•Multimedia card•XD picture card

Demands for micro SD card& USB card increased.The original brand flash memoryavailable.

・ DDS Data Cartridge （ DDS-4 ： 20GB DDS-3 ： 12GB DDS-2 ： 4GB DDS-1 ： 2 ～ 1.3GB ）

・ 8mm Data Cartridge（ HS-8/160D ： 7GB HS-8/112D ： 2.5/5GB AIT ： 2.5GB ～ 100GB ）

・ CD-R （ 52 double speed

・ CD-RW （ 1,000 times or more

・ 3.5”FD ・ 3.5”MO ・ 3.5” over-light MO

・ Blu-Ray,HD-DVD-R・ DVD±R（ one surface 4.7GB ）・ DVD±RW（ one surface 4.7GB 1,000 times or more ）・ DVD-RAM（ one surface 4.7GB/both surface 9.4GB 100,000 times or more ）

Digital Devices

Medium SizeComputers

Small computers &Home RecordersLarge Computers

Medias for large/medium/small computers available.

Duplication

Protect Copy

Outlet

Copy ProtectDuplication

Outlet

Outlet

Strategy 2010

Breakthrough US$200M by media/security/license/business development/overseas market

1. Business Development

3. Overseas market development Started oversea marketing to develop new business for any type of business.

2. Expansion of security business

Started portable application business to fuse various media & application

・ Security USB・ Security DVD-R・ Virus guard USB・ email transmitted and received USB・ File complete deletion USB・ File back-up CD-R,DVD-R,USB・ Contents USB・ Contents ＳＤ , Contents MCSD・ Flash memory copy protect

CD-R/DVD-R/USB memory protects for contents copy right protection to avoid personal information & classified documents

Our advantages

Provide Flash memory cards and its services

Provide portable application products

Competitive prices with various media devices

Quick delivery by the latest logistics technologies

Provide the competitive products

Our company policy is to make satisfaction of the Customers and services.

Reliability and sales records for media devices