SecuAvail Inc.

Although the Group has obtained ISO/IEC 27001 certification and implements multi-layered security measures such as firewalls and encryption, there is a risk that important information, including personal information of customers, officers, and employees, could be leaked outside the company, potentially resulting in claims for damages from third parties. In addition, there is a risk that the resulting loss of credibility could adversely affect the Group's overall business activities. As countermeasures, the Group has concluded confidentiality agreements with all officers and employees, introduced multiple firewalls and anti-virus systems, and operates its main servers in fault-tolerant data centers.

The Group's services are highly dependent on computer systems and communication networks, and there is a risk that service provision could be suspended due to unforeseen events such as system failures or natural disasters. If a service suspension occurs, it could adversely affect the Group's business results and financial condition. As a countermeasure, the Group provides services from intelligent buildings with excellent earthquake resistance and fire prevention performance equipped with private power generation facilities, and has implemented technical measures.

There is a risk that OS vendors or computer hardware vendors may develop in-house functions equivalent to the software provided by the Group and add them to their products. If such functions become competitive in terms of price and performance, there is a risk that the competitiveness of the Group's products could decline, affecting business results. The Group is addressing this by acquiring advanced and foundational technologies and actively investing in research and development.

There is a risk that competitors providing information security-related services may develop higher-quality services that surpass those of the Group by utilizing cutting-edge technology that responds quickly to customer needs. The rise of competing services could result in the loss of customers, adversely affecting the Group's business results. The Group strives to maintain and improve customer satisfaction through the continuous enhancement of information security-related technology and knowledge.

In the staffing services business, information security engineers are an important management resource, and securing excellent dispatched engineers is a necessary condition for business expansion amid expected continued growth in demand. If the Group fails to sufficiently secure dispatched engineers, there is a risk that it will be unable to respond to requests from client companies, affecting its business and results. The Group seeks to improve the quality of its technical personnel through efficient and effective recruitment and hiring activities and by focusing on personnel training.

As demand for outsourced personnel in the information security industry expands, competition for orders is intensifying, and the Group may face low-price strategies from competitors or requests for price reductions from clients. Insufficient order intake or a decline in staffing fees could adversely affect the Group's business and results. The Group is pursuing strategic sales activities that accurately respond to customer needs, aiming to expand its business while securing appropriate profits.