Global Communication Planning Co., Ltd.

Given the nature of the business handling credit card information, there is a high risk of information leakage. The Company has implemented countermeasures through ISO/IEC27001 certification and compliance with PCI DSS Ver4.0; however, if information is lost or leaked, this could result in a decline in social credibility and claims for damages. In addition, if the Company fails a renewal audit and loses its qualification, this could have a material impact on business continuity.

The Company procures the majority of its payment terminals from Castles Technology (whose factories are concentrated in China and Taiwan), and there is a risk that procurement could become difficult due to political turmoil, natural disasters, semiconductor shortages, exchange rate fluctuations, and other factors. The Company has also entered into a distributor agreement with Newland Payment Technology as a new supplier to diversify its procurement routes; however, deterioration in supplier relationships or geopolitical risk could affect the Company's financial position and results of operations.

In system development, there is a risk that unprofitable projects may arise due to significant specification changes during development or excess in man-hours. The Company addresses this through ISO9001-compliant quality control and project reviews by the Quality Assurance Department; however, if delivery deadlines are missed, additional costs are incurred, or claims for damages arise, this could affect business results and financial position.

The Company has been named in a patent infringement lawsuit filed by Mobility Co., Ltd. and others regarding a payment system utilizing payment terminals. Although the plaintiff's claims were dismissed in both the Tokyo District Court (March 2024) and the Intellectual Property High Court (May 2025), the final outcome of the litigation could affect the Company's business, financial position, and results of operations. In addition, the Company's own countersuit based on the Unfair Competition Prevention Act was also dismissed in the second instance, and as a result, the claims of both parties have been rejected.

Customer demands regarding pricing for IT investment are becoming increasingly stringent, and the Company is constantly exposed to price and quality competition with other companies in the same industry. The Company addresses this by providing added value through its expertise in the cashless payment field and connectivity to international brand payment networks; however, price competition with competitors could affect business results and financial position.

The Company relies primarily on borrowings from financial institutions and other sources for fundraising, resulting in a high ratio of interest-bearing debt. If sharp fluctuations in interest rates occur or if fundraising cannot proceed as planned, this could have a material impact on business results and financial position. Although the Company strives to control its interest-bearing debt, changes in financial conditions constitute a direct risk factor.

Transaction Media Networks Inc. (TMN), the Company's largest shareholder, is equivalent to a parent company accounted for under the equity method, and its Representative Director and President also serves as an outside director of the Company. While the Company currently maintains its independence and autonomy, any change in TMN's shareholding policy or in the content of the business alliance could affect the liquidity of the Company's shares, share price formation, business results, and financial position.

In the information services industry, technological innovation in IT is rapid, and there is a risk that the skills and expertise held by the Company could become obsolete and lose competitive advantage due to the evolution of existing technologies or delays in responding to new technologies. If the Company fails to predict or recognize the direction of technological change, or if research and development costs exceed expectations, this could affect business results and other outcomes.

While recruiting, developing, and motivating excellent personnel forms the foundation of the business, if intensifying competition for talent prevents sufficient hiring, or if existing personnel leave the Company, this could affect business results. Although the Company continuously works to improve compensation and working environments, given the knowledge-intensive and labor-intensive nature of the business, the impact of human resource risk is significant.

Since the Company imports products and uses services from companies in Taiwan and the United States denominated in foreign currencies, there is a risk that fluctuations in exchange rates could alter the yen-equivalent procurement price and raise the cost ratio. In particular, combined with the fact that the Company's major payment terminal suppliers have factories in Taiwan and China, exchange rate fluctuations could directly affect business results.