OBIC Co.,Ltd.

In the information services industry, rapid response to technological innovation and changing market needs is required, and the Company continues research and development activities across a wide range of fields including networking, communication technology, and software. However, if the Company falls behind in responding to rapid technological innovation across broad areas, this could result in opportunity losses due to delays in product development and increased development costs. This poses a risk that could affect the Company's business results.

The information services industry has a labor-intensive aspect, and employee motivation tends to directly affect business performance. In the event of a hostile takeover attempt, resulting confusion could lead to the departure of highly motivated personnel and the loss of know-how. The Company invests significant time and cost each year in securing and developing talented personnel. Such circumstances could result in a critical loss to stable, continuous corporate growth and may have a material impact on business results.

As a company providing cloud services that manage highly confidential business information, the Company has obtained SSAE 18-compliant SOC 1 and SOC 2 Type 2 reports, and works to prevent leakage of customer data through the development of information management regulations, employee training, and strengthened infrastructure security. However, if a leakage of personal information occurs due to cyberattacks, including computer viruses, or human error, this could result in expenses arising from customer damage claims and a decline in social credibility. This poses a risk that could affect the Company's business results.

As a company that provides and supports integrated core business systems, the Company bears a social responsibility for stable business continuity and has implemented BCP measures such as developing a telework environment and duplicating cloud center locations. However, large-scale natural disasters caused by recent climate change could affect business operations, and increased costs of complying with greenhouse gas emission regulations, or a decline in corporate reputation resulting from failure to comply, could occur. These pose risks that could affect the Company's business results.

Amid tightening environmental regulations worldwide aimed at mitigating climate change risk, the Company is working to reduce greenhouse gas emissions for both itself and its client companies by consolidating operations into cloud centers with advanced environmental performance. However, if the costs necessary to comply with emission regulations increase, or if the Company fails to comply, this could lead to a decline in corporate reputation. This poses a risk that could affect the Company's business results.

If a hostile acquirer were to launch a surprise takeover attempt, this could cause confusion among personnel, potentially leading to the departure of highly motivated employees and the loss of know-how. The Company regards securing and developing talented personnel as an important management priority, but such circumstances could result in a critical loss to stable, continuous corporate growth. The Company recognizes this risk as a hypothetical scenario and discloses it as a potential risk of material impact on business results.