SHARINGTECHNOLOGY.INC

The majority of traffic to the Company's sites is generated via search engines, and there is a risk that changes in ranking policies by search engine operators could reduce the effectiveness of SEO measures. A decline in traffic acquisition would directly lead to a decrease in revenue, resulting in a significant impact on the business foundation. As a countermeasure, the Company continues to implement SEO measures, but the structural dependency on external platforms has not been fundamentally resolved.

The Company handles large volumes of personal information of site users, and if information leakage occurs due to natural disasters, human-caused accidents, or malicious attacks, this could result in loss of social credibility and damages litigation. Similar incidents at affiliated stores or external contractors could also damage the Company's credibility. As countermeasures, the Company implements external access blocking on main servers, information security education, and internal audits.

Affiliated stores hold an important position of directly interfacing with users, and a decline in service quality or an insufficient number of affiliated stores would directly hinder service provision to users. As of September 30, 2025, the Company has a network of 7,222 affiliated stores, but if an affiliated store causes a serious incident, this could damage the Company's image and social credibility. As countermeasures, the Company implements strict selection through screening and credit management, builds a coverage system using nearby affiliated stores, and recommends various types of insurance enrollment.

As the "Life's Troubles" Business market expands, there is a possibility of an increase in new entrants and intensified competition with existing competitors. In particular, if competitors specialize in specific regions or services, they could develop their businesses in a short period, creating a risk of competitive relationships in that area. The Company recognizes that it has high entry barriers due to its nationwide affiliated store network and provision of services across multiple genres, but complete elimination of this risk is difficult.

Genres such as pest control, garden maintenance, and typhoon-related services have seasonal variability, with revenue increasing from spring to summer and decreasing in winter, and these account for a certain proportion of total revenue. If the expected number of inquiries cannot be obtained due to unusual weather or abnormal climate conditions, this would affect operating results. As a countermeasure, the Company is focusing on expanding service genres with lower seasonal variability, but the structure of seasonal concentration still remains.

The Company is subject to laws and regulations such as the "Act on the Protection of Personal Information," the "Act on Prohibition of Unauthorized Computer Access," and the "Act against Unjustifiable Premiums and Misleading Representations," and amendments to these laws or new regulatory subject matter could hinder business operations. As countermeasures, the Company conducts employee education through regular study sessions and strengthens and develops compliance regulations and guidelines. However, the content and timing of legal amendments are external factors, and there is a risk of increased compliance costs and business constraints.

Many of the trademarks used for the Company's services are combinations of common generic nouns, and as of the filing date of this document, the majority of operated Vertical Media Sites have not obtained or applied for trademark rights. If a third party acquires a similar trademark or uses one without authorization, this could develop into trademark infringement litigation, and there is also a risk of litigation against the Company if users mistake third-party services for the Company's services and become involved in disputes. As a countermeasure, the Company's policy is to proceed with additional trademark registrations while taking into account revenue trends and user needs.

The recording of revenue depends on the voluntary reporting by affiliated stores of construction completion and contract conclusion status, and if underreporting of construction amounts or false reporting occurs, this would lead to lost opportunities for revenue recording. As a countermeasure, the Company has established a system to periodically track and confirm the contract conclusion status and progress status of cases after introducing users to affiliated stores, but the structural risk based on self-reporting remains.

Securing, developing, and retaining talented personnel for business expansion is an important management issue, and if necessary personnel cannot be secured at the necessary time, or if capable personnel leave the Company, this would constrain future business development. In particular, delays in securing engineers in the internet industry would directly lead to difficulty in responding to technological changes. As a countermeasure, the Company is working to improve employee retention rates through continuous recruitment activities and enhanced employee benefits.

As of September 30, 2025, the number of potential shares from stock acquisition rights was 1,296,000 shares, equivalent to 5.3% of the total issued shares of 24,429,800 shares. The Company is considering continuing to issue stock options going forward, and if these are exercised, this could result in dilution of the Company's stock value and impact supply-demand relationships. While this is a measure aimed at securing talented personnel, it must be recognized as a risk of reduced equity value for existing shareholders.