Mirairo Inc.

The Company provides solutions to businesses, local governments, and educational institutions aimed at achieving the objectives of laws such as the Act for Eliminating Discrimination against Persons with Disabilities, the Act on Employment Promotion of Persons with Disabilities, and the Act on Promotion of Smooth Transportation for the Elderly and Disabled Persons (Barrier-Free Act). Amendments, abolition, new enactments, or changes in the application standards of these laws may affect the Company's business development and performance. The Company responds by providing diverse solutions to customer segments subject to these regulations, but depending on the direction of legal amendments, the demand structure could change significantly.

In the course of its business operations, the Company holds personal information and confidential information, and has obtained Privacy Mark certification and established an appropriate management system. However, if a security breach or hacking by a third party, or intentional or negligent conduct by an employee, results in the external leakage or unauthorized use of personal or confidential information, the Company could be held liable for damages and suffer significant harm to its social credibility, which may affect its business and performance.

The Company's main offices are located in Yodogawa-ku, Osaka City, and Shinagawa-ku, Tokyo. Should a large-scale natural disaster, act of terrorism, or widespread outbreak of infectious disease occur, it could affect overall business activities and adversely impact operating results and financial condition. There has been no significant historical impact on business activities to date, but the risk of concentration of business sites remains an ongoing issue.

The Barrier Value Solutions business has relatively low barriers to entry, as it requires neither licenses/permits nor large-scale capital investment, and increased competition due to new entrants may affect performance. The Company seeks to differentiate itself through solutions leveraging Mirairo ID and through hiring and training qualified specialist personnel such as sign language interpreters, but the risk of increasing competition cannot be denied.

Mirairo ID (digital disability certificate), the first private-sector application to utilize the Mynaportal API, is linked with information managed by local governments, and at present no equivalent similar application exists. The Company strives to protect its technology and know-how through means such as obtaining business model patents, but if competitors were to imitate the service, this could affect the Company's business development and performance.

The Company aims for stable management and sustainable growth by expanding sales per client and increasing the number of continuing clients. However, if individual solutions remain limited to one-time orders and the Company is unable to maximize sales per customer or achieve ongoing engagements, growth may not proceed as planned, which could affect performance. Cross-selling that leverages the Company's strength of holding diverse solutions is key to growth.

The Company listed on the Growth Market of the Tokyo Stock Exchange on March 24, 2025, but as of the end of the current fiscal year, the ratio of tradable shares stood at only 29.66%. The Company intends to improve liquidity through requests to existing shareholders to sell shares and through increases in tradable shares resulting from the exercise of stock options, but should liquidity decline for any reason, this could lead to stagnation in market trading and a deterioration in supply-demand balance.

Representative Director and President Toshiya Kakiuchi and Director and Vice President Takeo Tamino play important roles in management policy, business strategy, and the building of human networks. Should either of them step down, business operations could be affected. The Company is working to strengthen a management structure that does not depend on the two of them as its business expands, but at present the degree of dependence remains high.

The number of potential shares from stock acquisition rights granted as incentives to officers, employees, and outside collaborators is 202,500 shares (as of the filing date of this document), equivalent to 1.84% of the 11,020,100 shares issued. If these stock acquisition rights are exercised, the value of shares held by existing shareholders and their voting ratio may be diluted.

As of the end of the current fiscal year, the Company had 50 employees, a small organization, and it is expected that organizational strengthening through hiring and human resource development will be necessary to accommodate future business expansion. There is no guarantee that the Company will be able to hire and develop excellent personnel in a timely manner, and failure to secure human resources could affect the Company's business growth and operations.