UKAI CO.,LTD.

If a mass food poisoning incident occurs at a restaurant, an allergenic ingredient is mistakenly served, or a violation of the Food Labeling Act or the Food Sanitation Act or contamination by foreign matter occurs in the retail business, the associated response costs and the resulting decline in brand image and social credibility could have a material impact on business results and financial condition. As countermeasures, the Company has established a food safety system based on ISO22000, developed a store hygiene system in line with HACCP for food service establishments, ensured thorough allergy confirmation at the time of reservation or ordering, and provided education for multinational employees using manuals with foreign-language notations.

If deterioration in the hiring environment prevents the Company from securing the necessary personnel at an appropriate cost, or if training and retention do not proceed as planned, this could affect business results and financial condition through rising wage levels and recruitment costs and a decline in service quality and store operations. As countermeasures, the Company is working to secure and retain human resources through the use of referral hiring and a job-return system, the establishment and operation of the "UKAI Global Academy" (working to improve culinary skills starting with the TEPPAN course), the operation of a two-day weekend system, and the introduction of a defined contribution pension plan.

If a large-scale earthquake, storm or flood damage, or other natural disaster, or the spread of an infectious disease occurs, this could force a decline in customer visits or the closure or shortening of business hours at stores, potentially affecting business results and financial condition. As countermeasures, the Company has established a BCP and a system for early recovery, developed a system for concentrating customers, employees, and ingredients at stores that remain open for business, and introduced a safety confirmation system to grasp the status of employees.

If an officer or employee violates laws and regulations or internal rules, or engages in conduct deemed socially inappropriate, this could adversely affect business results and financial condition. As countermeasures, the Company continuously conducts overall management through the Risk Management Committee, holds regular meetings of the Compliance Subcommittee, and provides education and awareness-raising based on the "Risk Management Regulations" and the "Compliance Manual."

If changes in the global situation, such as unfavorable weather, natural disasters, epidemics, wars, or regional conflicts, cause a sharp rise in the procurement prices of ingredients and materials or make it difficult to secure the necessary quantities, this could affect business results and financial condition. As countermeasures, the Company has built a diversified procurement system involving multiple production areas and suppliers, strengthened relationships with business partners, and established a system to avoid lost opportunities by changing menus to use seasonal ingredients or changing packaging materials when procurement is difficult.

If the profitability of a store declines significantly due to changes in the business environment or other factors, or if the market price of an asset falls significantly below its book value, the Company may be unable to generate the expected cash flows and may need to record an impairment loss, which could affect business results and financial condition. As countermeasures, the Company strives to periodically assess indications of impairment, identify unprofitable groups, and actively implement measures aimed at the early recovery of investments.

If laws and regulations covering a wide range of areas, including food sanitation, building facilities, and labor, are changed or strengthened, this could affect business results and financial condition through the incurrence of response costs and constraints on business activities. As countermeasures, the Company continuously monitors the enactment, revision, and abolition of various laws and regulations, develops a system for legal compliance, and strives to share and embed information through regular training.

As the Company holds a large amount of customer personal information through reservations, payments, mail order sales, and other channels, if personal information or confidential business information is leaked due to a cyberattack or an employee's social media posting or removal of materials, this could affect business results and financial condition through a loss of social credibility, claims for damages, and damage to brand image. As countermeasures, the Company thoroughly manages access to internal information, conducts regular training on the handling of email, implements robust security measures, and provides internal education to improve information security literacy.

If there are deficiencies or delays in responding to social issues such as human rights and environmental problems, the resulting loss of social credibility could significantly damage the Company's brand image, affecting business results and financial condition. As a countermeasure, the Company has established a Sustainability Committee to advance discussions on responses to social issues and to work on reducing such risks.