1

March 2, 2009
To whom it may concern:
New "Business Rebuilding" and "Business Restructuring" Plans
This is to inform you that the Board of Directors, meeting on March 2, 2009, resolved to amend the Business Restructuring Plan as described below.
Details
Significant progress has been made on the "Business Restructuring Plan (Mid-Term Management Plan)" and "Business Restructuring" announced in October 2008, and they have had measurable effects. The financial restructuring and reorganization of our operating companies, together with savings on administrative expenses from the relocation of the head office and staffing reductions, enabled the company to post its first operating profit in a year during the 2nd quarter of the consolidated financial term (October-December 2008).
Nonetheless, the financial crisis triggered by the US subprime lending problem has resulted in global credit crunch, consumption slumps and equity price drops, triggering declines for the real economies of Japan and the rest of the world that far exceed initial expectations. Since the end of last year, our client companies in most industrial sectors and particularly export industries have seen sharp and accelerating declines in results that are producing significant changes in both the economic environment and the job market. These changes place us as a company in unprecedentedly difficult business circumstances.
With the economy in recession and as yet no foreseeable bottom, we are confronted by a crisis that goes far beyond the improvements and gains achieved by policies and programs to date. We therefore believe it imperative that we move forward with more thoroughgoing structural reforms, seeking to maintain our continuity as a company and protect as many jobs as possible while also maintaining our base of operations and providing our clients with stable services.
The manufacturing sector has been a driving force in Japan's recovery from the "Lost Decade," and the human resources business, particularly for engineers and manufacturing positions, has developed alongside it. Indeed, our industry has experienced a virtually uninterrupted growth since its inception, and this is the first crisis we have faced. These are difficult choices, but they are the only choices we can make, and we believe we must act now to prevent any further impairment of our base of operations, ensure our continuity as a leader in this industry, maintain as many jobs as possible for our talented and dedicated staff, and continue to provide staffing services to the client companies who will once again drive the Japanese economy.
Company:
RADIA HOLDINGS, INC.
Representative: Shinichi Horii
Representative Director and President

(Code No. 4723 TSE 2nd Section)
Contact:
Hideshi Tachiyama Senior Executive Officer General Manager, Public Relations and Investor Relations Division

(TEL: 03-3405-9262)

2
I.
Progress to date on the "Business Restructuring Plan (Mid-Term Management Plan)"
1. Financial restructuring
We have received the consent of most of our financial institutions, including Promontoria Investments I B.V., our largest lender, to a grace period on repayment through the end of June 2009. To strengthen our capital, we executed a capital increase by third-party allotment (common stock) worth 1,872 million yen on February 6, 2009 that equitizes debts to Promontoria Investments I B.V., Promontoria Investments II B.V. and Promontoria Investments III B.V. We plan to further equitize debt with a capital increase by third-party allotment (Class B preferred shares) of 13.6 billion yen in June 2009.
2. Restructuring of domestic operations
We are improving our service levels and reducing our costs by focusing our business on high-value added specialty fields. This has specifically taken the form of selling and withdrawing from non-core operations. In January 2009, we inaugurated a new structure that consolidates our core technical services into four companies from the previous seven and reduces our local offices from 406 to 204 locations. We have also concentrated our head office functions in Roppongi Hills to reduce head office rent expenses. To adapt to the smaller scale of operations, we have introduced an early retirement system for indirect employees. Having initially sought 1,120 volunteers, we were able to cut a total of approximately 1,600 positions to slim down our indirect departments.
II. Reasons for revisions to Business Restructuring Plan
There have been enormous, detrimental changes in the economic environment since the publication of our "Business Restructuring Plan (Mid-Term Management Plan)" in October 2008. The deterioration has continued since the beginning of the year and shows no signs of abatement. Given the difficulty of forecasting the future course of the economy and the scale of the changes that have taken place in both the economic environment and jobs market, we believe that more far-reaching restructuring will be required to ensure the group's viability, and have therefore decided to take the steps outlined below.
Engineer staffing services remain our core business, and we will continue to concentrate our resources on strategic operations, developing specialties that will enable us to overcome difficult economic circumstances and emerge at the other end of these changes in the competitive environment with a high degree of specialty and professionalism that will maintain our share of the human resources market.
[Commencement of further restructuring]
(1) Assignment of subsidiary operations (2) Restructuring of 3 engineering services subsidiaries (3) Restructuring of group indirect divisions (4) Cuts to executive pay
1. Assignment of subsidiary Premier-Line, Inc. (tentative)
(1) Objectives
After the reorganization and consolidation of our domestic human resources business in
January 2008, the group comprised four engineering services companies, one manufacturing services company and one clerical, sales staffing and personnel referrals company. In light of the increased severity in the business environment, we have decided to sell Premier-Line, Inc., our subsidiary in the manufacturing staffing services. Doing so will help to ensure stable growth over the medium and long terms by enabling us to concentrate and specialize on our core business of engineer staffing services. The result will be more efficient and competitive operations.

3
(2) Outline
Premier-Line, Inc. boasts the industry's highest levels of expertise and experience in
legally-compliant subcontracting services, but the dramatic changes taking place in the economic environment make contractions in the scale of its operations inevitable. The group has already articulated a "selection and concentration" strategy based on its "Business Restructuring Plan (Mid-Term Management Plan)," and has accelerated the speed with which it contracts non-core manufacturing staffing services.
There has been no change in our direction of pursuing legally-compliant manufacturing
subcontracting services, and we believe the only way to achieve this will be through a consolidation of worksites. However, the downturn in the economy that began last year has significantly reduced the number of assignee locations for which subcontracting is possible, and with the "2009 problem" (contravention date) looming, we anticipate that a significant decline in the number of dispatched staff will be unavoidable even were Premier-Line, Inc. to continue to operate on its own.
Recent news stories indicate that our competitors in manufacturing staffing services are
experiencing year-on-year declines in revenue of approximately 50%. We are confident that the declines for Premier-Line, Inc. will be somewhat less because transportation equipment and semiconductors account for smaller proportions of its business, but the impact will nonetheless be large, and sharp declines in gross profit will require commensurate reductions in management unit expenses.
Our judgment is therefore that the best course for maintaining the employment of
dispatched staff is to assign the staffing business to a competitor that is pursuing a subcontracting strategy or to proactively encourage assignee locations to hire staff directly.
We are also investigating the potential to assign the subcontracting business to a
competitor seeking to achieve greater scale merits. We envision three specific categories of assignee candidates: 1) clients to which we provide subcontracting and staffing services, 2) competitor staffing services working with the same clients, and 3) other companies. Our goal is to transfer this business as quickly as possible in order to alleviate anxieties over jobs and maintain the continuity of services to client companies. In terms of specific targets, we plan to assign the business in or around April 2009 with a goal of withdrawing from manufacturing staffing services by the end of June 2009.
Since the end of last year we have proactively encouraged several assignee locations for
which the "2009 problem" contravention date is approaching to change to direct employment or subcontracting agreements. A number of companies have already approached us regarding assignment of business and we have begun to investigate the potential for assignment to several candidates. We intend to assign the business and make the transfer as quickly as possible.
Further information on the details and schedule of the assignment will be disclosed as they
are finalized.
(3) Company profile

1
Name
Premier Line, Inc.

2
Representative
Koji Morikawa

3
Location of head office
2-3-14 Nihonbashi Muromachi, Chuo-ku, Tokyo

4
Established
August 1, 1986

5
Main lines of business
Manufacturing outsourcing

6
Settlement term
June

7
Employees
Dispatched staff (regular employee) 1,652;（contract staff ）4,500
Indirect staff (regular employee) 752 (as at the end of March 2009)

8
Capital
100 million yen

4

9
Total issued and outstanding shares
1,400 shares

10 Shareholder structure
RADIA HOLDINGS Premier, Inc. 100%

11 Results for most recent business years
(Unit: millions of yen)

FYE March 2008
FYE June 2008
Revenues
44,559
11,057
Gross profits on sales
6,577
2,074
Operating profits
-394
-162
Recurring profits
-459
-39
Net income
-1,701
71
Gross assets
18,716
18,314
Net assets
11,328
11,399
Note: Settlement term changed to June in 2008.
2. Restructuring of 3 engineering services subsidiaries
The vast changes taking place in economic circumstances, expectations of prolonged downturn and consequent capital investment restraints, production cuts and staffing cuts at client companies will significantly reduce capacity utilization rates. We will therefore adapt by reducing our reserve staff to more appropriate levels.
Reduction of reserve staff

1
Affected companies
Ctec, Inc., TechnoPro Engineering, Inc., CSI Co., Ltd.

2
Affected staff
Reserve staff

3
Departing staff
4,000 (tentative)

4
Departure date
April 15, 2009 (tentative)
Note that large reductions in bonuses are planned for this term.
*
HITEC Co., Ltd. is also subject to the bonus reduction.
3. Restructuring of indirect divisions at the group companies (holding company, operating
companies)
(1) Reductions in indirect staff (management and sales divisions)
We will make the following staff cuts in order to slim down and improve the efficiency of
indirect divisions in conjunction with contractions in the scale of operations.

1
Affected staff
Group company indirect employees

2
Departing staff
500 (tentative)

3
Departure date
April 15, 2009 (tentative)
(2) Wage cuts
In light of the significant staff cuts at group companies and in order to reduce fixed
expenses, we will make the following cuts in wages for indirect staff at group companies.
1
Wage cuts
Management positions
6 to 10 % depending on rank
Ordinary staff
3%
2
Period
1 year beginning April 2009

5
4. Executive pay cuts
Wages have already been cut for the representative director and six other members of the board for a six-month period beginning November 2008, but we take the sharp staffing cuts at group companies (holding company, operating companies) seriously and in order to clarify responsibility will be making the following cuts in executive wages at the holding company and operating companies. Wages will be reduced as follows for a period of one year beginning April 2009 (including wage cuts already in effect).
We also note that auditors have voluntarily offered to return auditing wages.
(1) Executive pay cuts
1
Holding company
Representative Director
30% pay cut
Director
25% pay cut
Senior Executive Officer
20% pay cut
Executive Officer
15% pay cut
Outside Director
10% pay cut
2
Operating companies
Representative Director and CEO
20% pay cut
Managing director
15% pay cut
Director
12% pay cut
Executive Officer
12% pay cut
(2) Return of auditing wages
Auditor
10% return of wages
(3) Period
1 year beginning April 2009
This restructuring will be implemented in consultation with labor unions.
III. New initiatives as an engineering staffing company
We will reorganize our operations, expand our education and training programs and install new IT systems in order to create an environment that increases the matching opportunities for talented engineers and strengthens our relationships with client companies.
1. Reorganization of 4 engineering service companies
We plan to reorganize engineering companies in April 2009 in order to expand into new areas and deepen our relationships with existing clients.
(1) Establishment of expert team to respond to the needs of new customers in green energy
and other areas where demand continues to expand
(2) Establishment of RM team to improve responsiveness to major existing companies in light
of the changes taking place in the competitive environment
(3) Expansion of "Career Design Adviser" (CDA) support team to train high quality
engineering staff and assist them in the design of their careers, thereby supporting the initiatives described above
2. Expansion of education and training programs
Radia University was established to provide educational and training opportunities that improve employee quality and develop new skills. It plans to offer classes in Yokohama and Osaka