addressed several near-term debt obligations and put the company back in a stable financial situation. Additionally, the confidence of Advent to make such a significant investment was an important validation of the value of AspenTech’s franchise and market opportunity. Another reason this capital investment was so critical to the company was that shortly after the fiscal year ended, the Federal Trade Commission (FTC) decided to challenge our acquisition of Hyprotech Ltd. The company’s improved financial position will enable us to mount a vigorous defense to this challenge. AspenTech does not agree with the FTC’s assertion that the transaction was anticompetitive or with its interpretation of the facts. We believe that the acquisition benefits customers and has enabled us to accelerate innovation in the marketplace. The company has accrued for the expenses relating to this challenge, which may take as long as three to five years to complete if all appeals are taken. In the meantime, we have the resources to defend against these allegations. In the interim, the litigation will not impact our commitment to our customers, and we will continue to deliver innovative, high-value engineering solutions. The improvement in our operating performance, our strengthened balance sheet and the tremendous value of our customer franchise give me a high level of confidence as we begin our new fiscal year. AspenTech enters fiscal 2004 very well positioned, with a set of solutions that deliver rapid, substantial returns to customers facing significant pressures on their operating performance every day. As we leverage the strength of our latest product offering, we will continue to focus on generating positive cash flow to build on our improved financial position. With more than seventy-five percent of our software revenues coming from recurring term licenses and with a significantly lowered break-even point, we believe we have dramatically increased the visibility and predictability of our business model. The executive management team has come together nicely, with the most recent addition being Chuck Kane, who joined the company as Chief Financial Officer at the start of fiscal 2004. The entire team is energized by the progress the company has made and is committed to generating profitable growth in the year ahead. “As we  leverage the strength of our latest product offering, we will continue to focus on generating positive cash flow to build on our improved financial position .”  As I close out my first year as CEO, I would like to recognize the loyalty of our customers and partners, and thank our employees for their dedication over what was a very challenging period. The progress we made over the past year would not have been possible without their support and encouragement. With the solid foundation we established in fiscal 2003, the groundwork has been laid for AspenTech to return to attractive financial and operational performance in the year ahead. Positioned for Profitable Growth  David L. McQuillin  President and Chief Executive Officer 10