# EDGAR Filing Document

**Accession Number:** 0002127221
**File Stem:** 0001193125-26-203924
**Filing Date:** 2026-5
**Character Count:** 282133
**Document Hash:** 2edb9284076f747168f95d34e2439fb3
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001193125-26-203924.hdr.sgml**: 20260504

**ACCESSION NUMBER**: 0001193125-26-203924

**CONFORMED SUBMISSION TYPE**: CB/A

**PUBLIC DOCUMENT COUNT**: 3

**FILED AS OF DATE**: 20260504

**DATE AS OF CHANGE**: 20260504

**SUBJECT COMPANY**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Vario Secure Inc.
- **CENTRAL INDEX KEY:** 0002127221

**ORGANIZATION NAME:**
- **EIN:** 000000000
- **STATE OF INCORPORATION:** M0
- **FISCAL YEAR END:** 0228

**FILING VALUES:**
- **FORM TYPE:** CB/A
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 005-95615
- **FILM NUMBER:** 26937345

**BUSINESS ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 5F SUMITOMO SHOJI NISHIKI-CHO BLDG.
- **STREET 2:** 1-6, KANDA NISHIKI-CHO, CHIYODA-KU
- **CITY:** TOKYO
- **PROVINCE COUNTRY:** M0
- **ZIP:** 101-0054
- **BUSINESS PHONE:** 81-355773284

**MAIL ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 5F SUMITOMO SHOJI NISHIKI-CHO BLDG.
- **STREET 2:** 1-6, KANDA NISHIKI-CHO, CHIYODA-KU
- **CITY:** TOKYO
- **PROVINCE COUNTRY:** M0
- **ZIP:** 101-0054
**FILED BY**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Heroz, Inc.
- **CENTRAL INDEX KEY:** 0002127215

**ORGANIZATION NAME:**
- **EIN:** 000000000
- **STATE OF INCORPORATION:** M0
- **FISCAL YEAR END:** 0430

**FILING VALUES:**
- **FORM TYPE:** CB/A

**BUSINESS ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 7F PMO TAMACHI, 5-31-17
- **STREET 2:** SHIBA, MINATO-KU
- **CITY:** TOKYO
- **PROVINCE COUNTRY:** M0
- **ZIP:** 108-0014
- **BUSINESS PHONE:** 81-364352495

**MAIL ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 7F PMO TAMACHI, 5-31-17
- **STREET 2:** SHIBA, MINATO-KU
- **CITY:** TOKYO
- **PROVINCE COUNTRY:** M0
- **ZIP:** 108-0014

**UNITED STATES** 

**SECURITIES AND EXCHANGE COMMISSION** 

**Washington, D.C. 20549** 

**FORM CB** 

**TENDER OFFER/RIGHTS OFFERING NOTIFICATION FORM** 

**(Amendment No. 1)** 

Please place an X in the box(es) to designate the appropriate rule provision(s) relied upon to file this Form:

---

| | |
|:---|:---|
|  Securities Act Rule 801 (Rights Offering) | ☐ |
|  Securities Act Rule 802 (Exchange Offer) | ☒ |
|  Exchange Act Rule 13e-4(h)(8) (Issuer Tender Offer) | ☐ |
|  Exchange Act Rule 14d-1(c) (Third Party Tender Offer) | ☐ |
|  Exchange Act Rule 14e-2(d) (Subject Company Response) | ☐ |
|  Filed or submitted in paper if permitted by Regulation S-T Rule 101(b)(8) | ☐ |

---

## Vario Secure Inc.
**(Name of Subject Company)** 

**N/A** 

**(Translation of Subject Company's Name into English (if applicable))** 

**Japan** 

**(Jurisdiction of Subject Company's Incorporation or Organization)** 

**HEROZ, Inc.** 

**(Name of Person(s) Furnishing Form)** 

**Common Stock** 

**(Title of Class of Subject Securities)** 

**N/A** 

**(CUSIP Number of Class of Securities (if applicable))** 

**HEROZ, Inc.** 

**7F PMO Tamachi** 

**5-31-17 Shiba, Minato-Ku, Tokyo** 

**108-0014** 

**Japan** 

**Telephone: +81-364352435** 

**(Name, Address (including zip code) and Telephone Number (including area code)** 

**of Person(s) Authorized to Receive Notices and Communications on Behalf of Subject Company)** 

**N/A** 

**(Date Tender Offer/Rights Offering Commenced)** 

------

**PART I - INFORMATION SENT TO SECURITY HOLDERS** 

**Item 1. Home Jurisdiction Documents** 

---

| | |
|:---|:---|
| **Exhibit**<br>**Number** |  |
| 99.1 | [Notice Regarding the Management Integration of HEROZ, Inc. and Variosecure, Inc.\*](http://www.sec.gov/Archives/edgar/data/2127215/000119312526156980/d128064dex991.htm) |
| 99.2 | [Notice of the 11<sup>th</sup> Annual Meeting of Shareholders](d100378dex992.htm) |
| 99.3 | [Electronically Provided Materials for the 11<sup>th</sup> Annual Meeting of Shareholders](d100378dex993.htm) |

---

\* previously submitted on Form CB

**Item 2. Informational Legends** 

The required legend is prominently included in the document(s) referred to in Item 1.

**PART II - INFORMATION NOT REQUIRED TO BE SENT TO SECURITY HOLDERS** 

N/A

**PART III - CONSENT TO SERVICE OF PROCESS** 

A written irrevocable consent and power of attorney on Form F-X was filed with the Commission by HEROZ, Inc. on April 15, 2026.

------

**SIGNATURES** 

After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

---

| | |
|:---|:---|
| **Heroz, Inc.** | **Heroz, Inc.** |
| Signature: | /s/ Takahiro Hayashi |
| Name: | Takahiro Hayashi |
| Title: | Representative Director |
| Date: | May 1, 2026 |

---

## Exhibit 99.2

**Exhibit 99.2** 

VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

This document relates to a proposed share exchange, which is a business combination involving the securities of a foreign company. The transaction is subject to disclosure requirements of a foreign country that are different from those of the United States. Financial statements included in this document, if any, have been prepared in accordance with foreign accounting standards that may not be comparable to the financial statements of United States companies.

It may be difficult for you to enforce your rights and any claim you may have arising under the federal securities laws, since the issuer is located in a foreign country, and some or all of its officers and directors may be residents of a foreign country. You may not be able to sue a foreign company or its officers or directors in a foreign court for violations of the U.S. securities laws. It may be difficult to compel a foreign company and its affiliates to subject themselves to a U.S. court's judgment.

You should be aware that the issuer may purchase securities otherwise than pursuant to the share exchange, such as in open market or privately negotiated purchases.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

[Delivery Document]

Securities Code: 4494

May 12, 2026

To Our Shareholders:

VarioSecure Inc.

1-6 Kanda Nishikicho, Chiyoda-ku, Tokyo

President and Representative Director: Shoichi Onoe

**NOTICE OF THE 11TH ANNUAL MEETING OF SHAREHOLDERS** 

Dear Shareholders,

We extend our sincere appreciation for your continued support of VarioSecure Inc. (the "Company").

We hereby give notice that the 11th Annual Meeting of Shareholders of the Company will be held as set forth below.

In connection with the convocation of this Annual Meeting, the Company has taken electronic provision measures with respect to information constituting the content of the Reference Documents for the General Meeting of Shareholders and other materials ("Electronically Provided Matters"). Such materials have been posted on the Company's website as the "Notice of the 11th Annual Meeting of Shareholders." Please access the Company's website at the address below to review them.

Company Website: https://www.variosecure.net/ir/library/

(Please access via the "Shareholders' Meeting" tab.)

The Electronically Provided Matters are also available on the shareholder meeting materials posting website and on the Tokyo Stock Exchange ("TSE") website. Please access one of the websites listed below and search for the Company by entering the company name "VarioSecure" or the securities code "4494", then select "Basic Information" followed by "Documents for Public Inspection/PR Information", and review the materials under the "Notice of Convocation/Shareholder Meeting Materials" column.

Shareholder Meeting Materials Website: https://d.sokai.jp/4494/teiji/

TSE Website (TSE Listed Company Information Service): https://www2.jpx.co.jp/tseHpFront/JJK010010Action.do?Show=Show

Shareholders may exercise their voting rights by mail or via the Internet in lieu of attending the meeting in person. After reviewing the Reference Documents for the General Meeting of Shareholders, please exercise your voting rights by 6:00 p.m. on Tuesday, May 26, 2026 in accordance with the instructions provided herein.

Sincerely, the Board of Directors

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

---

| | | |
|:---|:---|:---|
| **1.** | **Date and Time** | Wednesday, May 27, 2026 at 10:00 a.m. (Registration opens at 9:30 a.m.) |
| **2.** | **Location** | CONFERENCE, 3F Kanda Square, 2-1 Kanda Nishikicho, Chiyoda-ku, Tokyo (Please refer to the venue map at the end of this document.) |
| **3.** | **Agenda** | **Matters for Report** |
| **3.** |  | <br> Report on the Business Report and Financial Statements for the 11th Fiscal Year (March 1, 2025 to February 28, 2026) |
|  | **Matters for Resolution** | Proposal No. 1: Approval of the Share Exchange Agreement between the Company and HEROZ, Inc. Proposal No. 2: Election of Four (4) Directors (excluding Audit and Supervisory Committee Members) Proposal No. 3: Election of Three (3) Directors Who Are Members of the Audit and Supervisory Committee |
| **4.** | **Voting Instructions** | (1) Voting by Mail: Please indicate your vote on the enclosed Voting Rights Exercise Form and return it so that it is received by 6:00 p.m. on Tuesday, May 26, 2026. (2) Voting via the Internet: Please review the instructions on pages 4-5 and exercise your voting rights by 6:00 p.m. on Tuesday, May 26, 2026. (3) If voting rights are exercised multiple times: Internet votes shall take precedence over mail votes. If multiple Internet votes are submitted, the last submission shall be valid. (4) If no vote is indicated on a proposal: A vote in favor shall be assumed. |

---

In the event that any corrections are made to the Electronically Provided Matters, the details of such corrections (including the pre-correction and post-correction content) will be posted on the Company's website (https://www.variosecure.net/), the shareholder meeting materials posting website (https://d.sokai.jp/4494/teiji/), and the TSE website (TSE Listed Company Information Service) (https://www2.jpx.co.jp/tseHpFront/JJK010010Action.do?Show=Show).

For shareholders who have requested delivery of documents in writing, a document containing the Electronically Provided Matters is enclosed herewith. However, pursuant to applicable laws and Article 15 of the Company's Articles of Incorporation, the following matters have been excluded from such document:

(i) "Overview of the Framework to Ensure Proper Business Operations and the Status of Its Operation" in the Business Report;

(ii) "Fundamental Policy on Control of the Company" in the Business Report;

(iii) "Notes to Standalone Financial Statements" in the Financial Statements; and

(iv) The "Articles of Incorporation" of HEROZ, Inc. and the "Contents of the Financial Statements for HEROZ's Most Recent Fiscal Year (FY2025, ending April 2025)" included in the Reference Documents for the General Meeting of Shareholders.

**Notice for Shareholders Attending in Person** 

• Please present the enclosed Voting Rights Exercise Form at the registration desk upon arrival.

• No souvenirs will be provided to attending shareholders. We appreciate your understanding.

• If any attendee appears unwell after the meeting commences, a staff member may approach them or request that they leave the venue.

• Detailed explanations of matters for report (including audit reports) and proposals will be omitted at the meeting. Shareholders are requested to review this Notice in advance.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**Instructions for Exercising Voting Rights via the Internet** 

Shareholders wishing to exercise voting rights via the Internet are requested to note the following:

**1. Voting Website** 

Internet voting is available exclusively through the voting website designated by the Company:

Voting Website: https://www.web54.net

**2. How to Vote via the Internet** 

**(1) Using a Personal Computer** 

Access the above URL and enter the "Voting Code" and "Password" printed on the Voting Rights Exercise Form enclosed with this Notice, then follow the on-screen instructions to cast your vote.

**(2) Using a Smartphone** 

Scan the "QR Code for Smartphone Voting" printed on the Voting Rights Exercise Form to access the smartphone voting website, where your Voting Code and Password will be entered automatically. To change a previously submitted vote after using the QR code, scan the QR code again and enter your Voting Code and Password manually.

**3. Voting Procedures** 

(1) The voting deadline is 6:00 p.m. on Tuesday, May 26, 2026. We encourage shareholders to vote early.

(2) If voting rights are exercised both by mail and via the Internet, the Internet submission shall be deemed valid. If multiple Internet submissions are made, the last submission shall be deemed valid.

(3) Internet connection fees and related charges are the responsibility of the shareholder.

(4) The voting website may not be accessible depending on your Internet environment.

**4. Handling of Voting Code and Password** 

(1) Your Password is important personal information used to verify your identity as a registered shareholder. Please handle it with care, as you would a personal seal or PIN.

(2) If the Password is entered incorrectly a certain number of times, it will become locked. To request reissuance, follow the on-screen instructions.

(3) The Voting Code printed on the Voting Rights Exercise Form is valid only for this Annual Meeting.

**5. Technical Support** 

(1) For questions regarding computer operation for online voting, please contact:

Sumitomo Mitsui Trust Bank, Stock Transfer Agency Web Support Dedicated Line

Tel: 0120-652-031 (Hours: 9:00 a.m. – 9:00 p.m.)

(2) For all other inquiries:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Shareholders who hold shares through a securities firm: Please contact your brokerage firm.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**BUSINESS REPORT** 

*(For the fiscal year from March 1, 2025 to February 28, 2026)* 

**1. Current Status of the Company** 

**(1) Business Overview for the Current Fiscal Year** 

**(i) Business Progress and Results** 

During the current fiscal year, the Japanese economy continued to recover moderately, supported by improvements in employment and income conditions and the effects of various government policies. At the same time, rising prices, U.S. trade policy developments, and escalating tensions in the Middle East contributed to heightened uncertainty in the global economy, presenting downside risks to the domestic economy.

With respect to the security services market in which the Company operates, cyber threats continue to intensify year by year, with ransomware attacks posing serious risks not only to small and medium-sized enterprises (SMEs) but also to large corporations.

In this environment, demand in the security services market continues to expand in response to increasingly diverse cyberattack threats. The trend of enterprises outsourcing their security operations and monitoring to managed security service providers—due to the difficulty of managing sophisticated security measures in-house—has supported continued growth in service adoption. In August 2025, the Company also launched a ransomware protection package designed to address business continuity risks for mid-sized and SME enterprises.

Against this backdrop, revenue from Security BPO Services (Note 1) increased year-over-year, driven by the accumulation of recurring subscription revenue, a low churn rate of 0.72% (Note 2), the effect of price revisions, and growth in the number of Vario Managed EDR licenses. In Integration Services, the Network Integration Service—covering procurement and construction of network equipment—also achieved year-over-year revenue growth.

Costs increased due to price hikes in various license and maintenance fees resulting from rising raw material and energy prices.

As a result, the Company's performance for the current fiscal year under Japanese GAAP was as follows: net revenue of ¥2,842,655 thousand (up 6.6% year-over-year), operating income of ¥302,276 thousand (up 39.2%), ordinary income of ¥290,422 thousand (up 41.2%), and net income of ¥105,811 thousand (up 46.9%).

For reference, the Company's performance under IFRS was as follows: revenue of ¥2,842,655 thousand (up 6.6% year-over-year), operating income of ¥561,509 thousand (up 14.1%), income before taxes of ¥546,538 thousand (up 14.5%), and net income of ¥377,611 thousand (up 10.3%). Please also refer to "(2) Financial Results for the Three Most Recent Fiscal Years" below, which includes reference IFRS data.

(Note 1) The service previously referred to as "Managed Security Services" has been renamed "Security BPO Services" for the current fiscal year. This is a name change only and has no impact on segment information.

(Note 2) Churn rate (value-based) = Annual cancelled contract value ÷ (Monthly recurring revenue at the beginning of each fiscal year × 12)

**(ii) Capital Expenditures** 

Total capital expenditures for the current fiscal year amounted to ¥87,895 thousand, primarily consisting of ¥61,831 thousand in tools, equipment, and software development costs related to Security BPO Services, which were capitalized as software in progress.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**(iii) Financing Activities** 

Not applicable.

**(iv) Transfer, Absorption-Type Company Split, or Incorporation-Type Company Split** 

Not applicable.

**(v) Acquisition of Business from Another Company** 

Not applicable.

**(vi) Succession of Rights and Obligations Through Merger or Absorption-Type Company Split** 

Not applicable.

**(vii) Acquisition or Disposal of Shares or Stock Acquisition Rights of Another Company** 

Not applicable.

**(2) Financial Results for the Three Most Recent Fiscal Years (Japanese GAAP)** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **FY8 (Feb. 2023)** | **FY9 (Feb. 2024)** | **FY10 (Feb. 2025)** | **FY11 (Current)<br>(Feb. 2026)** |
|  Net Revenue (¥ thousands) | 2634377 | 2640423 | 2667539 | 2842655 |
|  Ordinary Income (¥ thousands) | 276062 | 246848 | 205677 | 290422 |
|  Net Income (¥ thousands) | 110313 | 88924 | 72049 | 105811 |
|  EPS (¥) | 26.88 | 19.69 | 15.94 | 23.41 |
|  Total Assets (¥ thousands) | 6179162 | 5697743 | 5325076 | 5211568 |
|  Net Assets (¥ thousands) | 3834938 | 3743219 | 3817130 | 3922941 |
|  BPS (¥) | 849.35 | 828.41 | 844.53 | 868.19 |

---

(Notes) 1. EPS (earnings per share) is calculated using the weighted average number of shares outstanding during the period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. BPS (book value per share) is calculated using the total number of shares outstanding at fiscal year-end.

**(Reference) Financial Results for the Three Most Recent Fiscal Years (IFRS)** 

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **FY8 (Feb. 2023)** | **FY9 (Feb. 2024)** | **FY10 (Feb. 2025)** | **FY11 (Current)<br>(Feb. 2026)** |
|  Revenue (¥ thousands) | 2634377 | 2640423 | 2667539 | 2842655 |
|  Income Before Taxes (¥ thousands) | 542394 | 509156 | 477175 | 546538 |
|  Net Income (¥ thousands) | 383316 | 347604 | 342233 | 377611 |
|  Basic EPS (¥) | 93.41 | 76.96 | 75.72 | 83.55 |
|  Total Assets (¥ thousands) | 7826190 | 7649933 | 7576240 | 7791276 |
|  Total Equity (¥ thousands) | 5378973 | 5548163 | 5891882 | 6270144 |
|  BPS (Total Equity) (¥) | 1191.32 | 1227.87 | 1303.56 | 1387.65 |

---

(Notes) 1. The Company prepares financial statements under IFRS; accordingly, IFRS-based figures are also presented for reference.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Basic EPS is calculated using the weighted average number of shares outstanding during the period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. BPS (book value per share based on total equity) is calculated using the total number of shares outstanding at fiscal year-end.

**(3) Significant Parent Company and Subsidiary Information** 

**(i) Parent Company** 

The Company's parent company is HEROZ, Inc., which holds 1,934 thousand shares of the Company's common stock, representing a voting rights ratio of 42.8%.

HEROZ, Inc. has the authority to nominate candidates for six (6) of the Company's director positions (excluding directors who are members of the Audit and Supervisory Committee), as well as the authority to remove nominated directors. The Company's Nomination Committee has the authority to nominate the remaining five (5) candidates (including three (3) directors who are members of the Audit and Supervisory Committee).

**(ii) Transactions with the Parent Company** 

Not applicable.

**(iii) Significant Subsidiaries** 

Not applicable.

**(4) Key Business Challenges** 

**(i) Talent Acquisition and Development** 

We recognize that attracting and developing talent—the source of sustainable corporate value creation—is the Company's most critical challenge in pursuit of medium-term growth. Leveraging HEROZ, Inc.'s upcoming acquisition of the Company as a wholly-owned subsidiary as an opportunity, the Company will directly incorporate HEROZ's "HR Enablement Service" into its recruitment strategy. We will use AI-powered data analytics to improve recruiting precision and will pursue optimal outreach to target talent pools, thereby significantly accelerating the acquisition of immediately deployable specialized professionals. We will also build a unified Group recruiting brand to establish competitive advantage in the talent market, create an environment where exceptional talent can maximize their capabilities, and drive further growth by maximizing Group synergies.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**(ii) Strengthening Management Structure** 

The Company believes that strengthening its management structure is essential for sustainable corporate growth. Using the planned acquisition of the Company as a wholly-owned subsidiary by HEROZ, Inc. as an opportunity, the Company will work to accelerate and streamline decision-making while enhancing management transparency, with the goal of further improving long-term corporate value.

**(iii) Service Development Responsive to New Technologies and Social Changes** 

As cloud service adoption expands, work styles evolve, and cyberattacks become increasingly sophisticated, security threats now transcend traditional network perimeters. Against this backdrop, the Company has expanded its service portfolio beyond managed security services—including uptime monitoring and device maintenance—to include endpoint security services for detecting and eliminating security risks and backup services for data protection and recovery. In its medium-term business plan, the Company aims to provide comprehensive security services as an integrated security vendor. The Company will continue to deliver services that meet evolving market demands as the need for new security solutions grows.

**(5) Principal Business Activities (as of February 28, 2026)** 

The Company's mission is: "Your NET Guardian, alongside your invaluable Future" — partnering with enterprises to protect their network security and support safe and reliable business operations. The Company provides Security BPaaS (Business Process as a Service) "Vario Ultimate ZERO," which handles 24/365 WORK in security.

Under its value proposition of "Justice for your NET" — permanently deploying a champion of justice for corporate network infrastructure — the Company provides network security deployment and managed operations services based on domestically developed, proprietary products.

---

| | | |
|:---|:---|:---|
| **Segment** | **Service Line** | **Business Description** |
| Internet Security Services | Security BPO Services | • Integrated internet security service using the Company's proprietary dedicated device (VSR) • Data backup service (VDaP) • Endpoint security service (Vario EDR) • Vario Managed LAN/Wi-Fi service |
|  | Integration Services | • Sales of VCR (Vario Communicate Router), a unified threat management (UTM) device for SMEs • Network Integration Service: procurement and construction of network equipment |

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**(6) Principal Offices (as of February 28, 2026)** 

---

| | |
|:---|:---|
| **Office** | **Location** |
| Head Office | Chiyoda-ku, Tokyo |
| Osaka Office | Nishi-ku, Osaka City, Osaka |
| Fukuoka Sales Office | Hakata-ku, Fukuoka City, Fukuoka |

---

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**(7) Employee Status (as of February 28, 2026)** 

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| | | | |
|:---|:---|:---|:---|
| **Headcount** | **Change vs. Prior Year** | **Average Age** | **Avg. Years of Service** |
| 83 (4.7) | Decreased by 10 | 40.13 years | 6.07 years |

---

(Note) Headcount reflects active employees. Temporary employees (including part-time and agency workers) are shown in parentheses as the average number employed over the most recent one-year period and are excluded from the headcount figure.

**(8) Principal Borrowings (as of February 28, 2026)** 

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| | | |
|:---|:---|:---|
| **Lender** | **Outstanding Balance (¥ thousands)** | **Outstanding Balance (¥ thousands)** |
|  Mizuho Bank, Ltd. |  | 337500 |
|  Aozora Bank, Ltd. |  | 337500 |
|  Shoko Chukin Bank, Ltd. |  | 225000 |

---

**(9) Other Material Matters Regarding the Current Status of the Company** 

Not applicable.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**2. Share Information (as of February 28, 2026)** 

---

| | |
|:---|:---|
| (1) Authorized Shares | 14,900,000 shares |
| (2) Issued and Outstanding Shares | 4,522,961 shares |
| (3) Number of Shareholders | 2,655 shareholders |

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**(4) Principal Shareholders** 

---

| | | |
|:---|:---|:---|
| **Shareholder** | **Shares Held** | **Ownership %** |
|  HEROZ, Inc. | 1934000 | 42.80% |
|  Hikari Tsushin KK Investment Business LP | 301600 | 6.67% |
|  Rakuten Securities, Inc. (Joint Account) | 157800 | 3.49% |
|  SBI Securities Co., Ltd. | 130098 | 2.88% |
|  Hikari Power Co., Ltd. | 114300 | 2.53% |
|  UH Partners 2 Investment Business LP | 109600 | 2.43% |
|  Yasumitsu Shigeta | 106600 | 2.36% |
|  BNY GCM CLIENT ACCOUNT JPRD AC ISG (FE-AC) (Standing Agent: MUFG Bank, Ltd.) | 64200 | 1.42% |
|  Shigeo Makita | 54300 | 1.20% |
|  Daisuke Yamamoto | 52000 | 1.15% |

---

(Note) Ownership percentage is calculated by deducting treasury shares (4,427 shares) from the denominator, rounded to
two decimal places.

**(5) Shares Granted to Directors as Compensation During the Current Fiscal Year** 

Not applicable.

**(6) Other Material Matters Regarding Shares** 

Nothing material to report.

**3. Stock Acquisition Rights** 

**(1) Stock Acquisition Rights Held by Directors as Compensation (as of fiscal year-end)** 

Not applicable.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**(2) Stock Acquisition Rights Granted to Employees as Compensation During the Current Fiscal Year** 

Not applicable.

**(3) Other Material Matters Regarding Stock Acquisition Rights** 

Not applicable.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**4. Directors and Officers** 

**(1) Directors (as of February 28, 2026)** 

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| | | |
|:---|:---|:---|
| **Position** | **Name** | **Responsibilities and Significant Concurrent Positions** |
| President and Representative Director | Shoichi Onoe | Head of Business Division Global Bright LLC – Representative Member |
| Director | Takahiro Hayashi | HEROZ, Inc. – President and Representative Director (CEO) StrategIT Co., Ltd. – Director AI Squared, Inc. – Director Tifana.com, Inc. – Director VOIQ Inc. – Director Rakumachi, Inc. – Outside Director |
| Director | Keiichi Iguchi | HEROZ, Inc. – Director (CTO) VOIQ Inc. – Director |
| Director | Hiroya Mori | HEROZ, Inc. – Director (CFO) StrategIT Co., Ltd. – Director AI Squared, Inc. – Director Tifana.com, Inc. – President and Representative Director VOIQ Inc. – Director |
| Director (Audit and Supervisory Committee Member) | Keiko Hata | HOP Inc. – President and Representative Director (CEO) |
| Director (Audit and Supervisory Committee Member) | Kana Takahashi | Hifumi General Law Office – Attorney at Law matsuri technologies Inc. – Outside Audit & Supervisory Board Member Canadian Solar Infrastructure Fund – Supervisory Officer Renatasu Inc. – Director (Audit and Supervisory Committee Member) Kasumigaseki Hotel REIT Investment Corp. – Supervisory Officer |
| Director (Audit and Supervisory Committee Member) | Motoi Moriwaki |  |

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(Notes)

1. Directors who resigned during the current fiscal year:

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| | | | |
|:---|:---|:---|:---|
| **Name** | **Resignation Date** | **Reason** | **Title and Responsibilities at Time of<br>Resignation** |
| Satoshi Yamamori | November 18, 2025 | Resignation | Director |
| Hidetoshi Nagai | February 24, 2026 | Resignation | Director, Head of Administration Division |

---

2. Changes in director titles and responsibilities during the current fiscal year:

---

| | | | |
|:---|:---|:---|:---|
| **Name** | **Previous Title** | **New Title** | **Effective Date** |
| Satoshi Yamamori | President & Representative Director, Head of Technology Division | Director | July 11, 2025 |
| Shoichi Onoe | Director, Head of Sales Division | President & Representative Director, Head of Sales Division | July 11, 2025 |

---

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

3. Under the Company's structure as a company with an Audit and Supervisory Committee, the Committee conducts organizational audits through the internal control system. The full-time internal audit department head shares audit-relevant information with the directors serving as Audit and Supervisory Committee members, enabling appropriate mutual cooperation. Accordingly, the Company has determined that a standing (full-time) Audit and Supervisory Committee member is not required.

4. Directors Keiko Hata, Kana Takahashi, and Motoi Moriwaki are outside directors serving as Audit and Supervisory Committee members.

5. Director Keiko Hata has extensive expertise in human capital development.

6. Director Kana Takahashi is a licensed attorney and possesses advanced professional expertise in corporate law, the Financial Instruments and Exchange Act, and related regulations.

7. Director Motoi Moriwaki has extensive knowledge of finance and accounting.

8. The Company has designated Directors Keiko Hata, Kana Takahashi, and Motoi Moriwaki as independent officers as defined by the TSE and has filed the relevant notification with the TSE.

**(2) Liability Limitation Agreements** 

Pursuant to Article 427, Paragraph 1 of the Companies Act, the Company has entered into agreements with its non-executive directors and outside directors serving as Audit and Supervisory Committee members to limit their liability for damages under Article 423, Paragraph 1 of the Companies Act. The maximum liability under such agreements is the amount prescribed by applicable law. Such limitation of liability applies only when the relevant director has acted in good faith and without gross negligence in the performance of the duties giving rise to such liability.

**(3) Directors' and Officers' (D&O) Liability Insurance** 

The Company has entered into a Directors' and Officers' (D&O) liability insurance contract as provided for under Article 430-3, Paragraph 1 of the Companies Act. The insured parties are the Company's directors and directors serving as Audit and Supervisory Committee members. All insurance premiums are paid by the Company; accordingly, insured parties bear no portion of the premium. Under this policy, if a claim for damages is made against an insured party during the policy period arising from acts taken in their capacity as a director, the policy covers damages payable and litigation costs incurred by the insured party. Certain exclusions apply, including acts where the insured party knew such acts were in violation of law.

**(4) Director Compensation** 

**(i) Policy for Determining Individual Director Compensation (Excluding Audit and Supervisory Committee Members)** 

The policy for determining individual director compensation (excluding Audit and Supervisory Committee members) was resolved at the Extraordinary Board of Directors' Meeting held on November 30, 2022.

**a. Basic Policy** 

Director compensation (excluding Audit and Supervisory Committee members) shall constitute a compensation structure that functions as a sufficient incentive for the sustainable improvement of corporate value. Individual director compensation shall be set at appropriate levels reflecting each director's responsibilities. Specifically, the compensation of executive directors shall consist of base salary (fixed compensation), performance-based compensation, and non-monetary compensation. Outside directors, in light of their supervisory role, shall receive base salary only.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

To enhance procedural fairness, transparency, and objectivity in compensation decisions, the Board has established a voluntary Compensation Committee as an advisory body. The Committee deliberates on matters relating to individual director compensation and assesses whether compensation levels are appropriate, reporting its findings to the Board.

**b. Policy on Base Salary (Cash Compensation)** 

Director base salary shall be a fixed monthly payment, determined comprehensively taking into account each director's role, responsibilities, and tenure, benchmarked against peer companies, corporate performance, and employee compensation levels.

**c. Performance-Based Compensation and Non-Monetary Compensation** 

Performance-based compensation shall be a cash payment reflecting business performance metrics for each fiscal year, calculated based on the degree of achievement of revenue, operating income, and net income targets for the fiscal year, and paid in the following year.

Non-monetary compensation shall be granted in the form of restricted stock units (RSUs) to incentivize medium- to long-term corporate value creation and stock price appreciation, and to align directors' interests with those of shareholders. The total amount shall be within the limits approved at the general meeting of shareholders. The specific timing and allocation of RSUs shall be determined by the Board of Directors.

**d. Policy on Proportions of Each Compensation Component** 

The proportion of base salary, performance-based compensation, and non-monetary compensation relative to total individual director compensation shall be set at the most appropriate ratio to align the interests of shareholders and management, and to contribute to the sustainable enhancement of corporate value.

**e. Decision Process for Individual Director Compensation** 

The Board of Directors has delegated to the Representative Directors the authority to make final decisions on individual cash compensation for directors, based on the advisory findings of the Compensation Committee. This delegation reflects the judgment that Representative Directors Satoshi Yamamori and Shoichi Onoe are best positioned to comprehensively evaluate corporate performance and individual directors' execution of duties. The Representative Directors must act in accordance with the Compensation Committee's recommendations; accordingly, the Board has determined that the resulting compensation is consistent with established policy.

Non-monetary compensation shall be determined by resolution of the Board of Directors, based on the advisory findings of the Compensation Committee, with the specific number of shares allocated to each individual director specified.

**(ii) Shareholder Resolutions on Director Compensation** 

At the Extraordinary General Meeting of Shareholders held on November 30, 2022, the aggregate annual compensation for directors (excluding Audit and Supervisory Committee members) was approved at up to ¥130 million per year (of which, up to ¥10 million per year for outside directors). At the time of such resolution, there were eight (8) directors (excluding Audit and Supervisory Committee members), including one (1) outside director.

At the same meeting, the aggregate annual compensation for directors serving as Audit and Supervisory Committee members was approved at up to ¥25 million per year. At the time of such resolution, there were three (3) such directors, all of whom were outside directors.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

Additionally, separate from the above cash compensation caps, at the same meeting a budget of up to ¥20 million per year for RSU grants to directors (excluding Audit and Supervisory Committee members, non-executive directors, and outside directors) was approved (excluding compensation attributable to the employee portion for employee-director positions). At the time of such resolution, there were eight (8) directors (excluding Audit and Supervisory Committee members), including three (3) non-executive directors and one (1) outside director, and the eligible directors numbered four (4).

**(iii) Total Director Compensation for the Current Fiscal Year** 

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Category** | **Persons** | **Total<br>Compensation (¥<br>thousands)** | **Fixed Compensation<br>(¥ thousands)** | **Non-Monetary (RSUs)<br>(¥ thousands)** |
|  Directors (excluding Audit and Supervisory Committee Members) (of which, outside directors) | 3 (—) | 47102 (—) | 46916 (—) | 186 (—) |
|  Directors (Audit and Supervisory Committee Members) (of which, outside directors) | 3 (3) | 12600 (12600) | 12600 (12600) | — (—) |
|  Total (of which, outside directors) | 6 (3) | 59702 (12600) | 59516 (12600) | 186 (—) |

---

(Note) Non-monetary compensation consists of RSU grants. Conditions of grant
are as described in Section 4.(4) above. The amount shown reflects expenses recognized in the current fiscal year.

**(5) Matters Regarding Outside Directors** 

(i) Significant Concurrent Positions at Other Entities and the Relationship Between Such Entities and the Company

• Director (Audit and Supervisory Committee Member) Keiko Hata serves as President and Representative Director
(CEO) of HOP Inc. There is no special relationship between the Company and such entity.

• Director (Audit and Supervisory Committee Member) Kana Takahashi serves as an attorney at Hifumi General Law
Office, Outside Audit & Supervisory Board Member of matsuri technologies Inc., Supervisory Officer of Canadian Solar Infrastructure Fund, Director (Audit and Supervisory Committee Member) of Renatasu Inc., and Supervisory Officer of
Kasumigaseki Hotel REIT Investment Corp. There is no special relationship between the Company and any of such entities.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

(ii) Activities During the Current Fiscal Year

---

| | |
|:---|:---|
| **Name** | **Attendance and Activities During the Current Fiscal Year** |
| Keiko Hata (Audit and Supervisory Committee Member) | Attended 20 of 21 Board of Directors' meetings and all 15 Audit and Supervisory Committee meetings held during the fiscal year. Leveraged her extensive experience in human capital development to provide appropriate advice on HR strategy, talent utilization, and organizational revitalization, thereby fulfilling her responsibilities as a director. |
| Kana Takahashi (Audit and Supervisory Committee Member) | Attended all 21 Board of Directors' meetings and all 15 Audit and Supervisory Committee meetings held during the fiscal year. Applied her advanced legal expertise as an attorney to oversee management from a legal perspective to strengthen corporate governance, thereby fulfilling her responsibilities as a director. |
| Motoi Moriwaki (Audit and Supervisory Committee Member) | Attended 20 of 21 Board of Directors' meetings and all 15 Audit and Supervisory Committee meetings held during the fiscal year. Leveraged his deep knowledge in IR and finance to oversee and advise on management from a fair and impartial perspective, thereby fulfilling his responsibilities as a director. |

---

**5. Independent Auditor** 

**(1) Name: Akasaka LLC Audit Corporation** 

**(2) Auditor Fees** 

---

| | |
|:---|:---|
| **Item** | **Amount (¥ thousands)** |
|  Audit fees for the current fiscal year | 24000 |
|  Total monetary and other financial benefits payable to the auditor | 24000 |

---

(Notes) 1. The audit engagement agreement with the auditor does not separately distinguish between fees for audit under the Companies Act and audit under the Financial Instruments and Exchange Act, and such amounts are not practically distinguishable. Accordingly, the total of both is presented above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The Audit and Supervisory Committee reviewed and verified the appropriateness of the auditor's audit plan, execution of audit duties, and the basis for fee estimates before consenting to the amount of fees payable.

**(3) Policy on Dismissal or Non-Reappointment of the Independent Auditor** 

If the Audit and Supervisory Committee determines that circumstances warrant dismissal or non-reappointment of the independent auditor—including situations where the auditor's execution of duties is impaired—it shall determine the content of the relevant agenda item to be submitted to the general meeting of shareholders.

If the Audit and Supervisory Committee determines that the auditor falls under any of the items set forth in Article 340, Paragraph 1 of the Companies Act, it may dismiss the auditor with the unanimous consent of all Audit and Supervisory Committee members. In such case, the first general meeting of shareholders convened after the dismissal shall be informed of the fact and reason for dismissal.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**Standalone Balance Sheet** 

*(As of February 28, 2026)* 

(Unit: ¥ thousands)

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Item** | **Amount** | **Amount** | **Item** | **Amount** |
|  **ASSETS** |  |  | **LIABILITIES** |  |
|  **CURRENT ASSETS** |  | **1868393** | **CURRENT LIABILITIES** | **547660** |
|  Cash and deposits |  | 973433 | Trade accounts payable | 73179 |
|  Trade accounts receivable |  | 528946 | Current portion of long-term borrowings | 200000 |
|  Work in process |  | 24734 | Accounts payable – other | 43734 |
|  Supplies |  | 184160 | Deferred revenue (current) | 8508 |
|  Prepaid expenses |  | 145730 | Accrued expenses | 9881 |
|  Advance payments |  | 4766 | Advance payments received | 55311 |
|  Other |  | 6622 | Provision for Bonuses | 1000 |
|  NON-CURRENT ASSETS |  | 3343174 | Income taxes payable | 122568 |
|  *Property, plant and equipment* | | *109207* | Consumption taxes payable | 29177 |
|  Building improvements |  | 20932 | Other | 4300 |
|  Tools, furniture and fixtures |  | 61839 | **NON-CURRENT LIABILITIES** | **740965** |
|  Construction in progress |  | 26435 | Long-term borrowings | 700000 |
|  *Intangible assets* | | *3014418* | Asset retirement obligations | 18578 |
|  Software |  | 94290 | Long-term deferred revenue | 21237 |
|  Goodwill |  | 2710771 | Other | 1150 |
|  Software in progress |  | 209356 | **TOTAL LIABILITIES** | **1288626** |
|  *Investments and other assets* | | *219547* |  |  |
|  Bankruptcy and reorganization claims |  | 129 | **NET ASSETS** |  |
|  Deferred tax assets |  | 82141 | **Shareholders' equity** | **3922941** |
|  Long-term prepaid expenses |  | 66577 | Common stock | 751798 |
|  Other |  | 70829 | Capital surplus | 1995098 |
|  Allowance for doubtful accounts |  | (129) | Additional paid-in capital | 541798 |
|  |  |  | Other capital surplus | 1453300 |
|  |  |  | Retained earnings | 1176130 |
|  |  |  | Other retained earnings | 1176130 |
|  |  |  | Retained earnings brought forward | 1176130 |
|  |  |  | Treasury stock | (85) |
|  |  |  | **TOTAL NET ASSETS** | **3922941** |
|  **TOTAL ASSETS** |  | **5211568** | **TOTAL LIABILITIES AND NET ASSETS** | **5211568** |

---

(Note) Amounts less than ¥1 thousand are rounded down.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**Standalone Statement of Income** 

*(For the fiscal year from March 1, 2025 to February 28, 2026)* 

(Unit: ¥ thousands)

---

| | | |
|:---|:---|:---|
| **Item** | | **Amount** |
|  Net revenue |  | 2842655 |
|  Cost of revenue |  | 1388904 |
|  Gross profit |  | 1453750 |
|  Selling, general and administrative expenses |  | 1151474 |
|  Operating income |  | 302276 |
|  Non-operating income |  |  |
|  Interest income | 1758 |  |
|  Other | 1125 | 2883 |
|  Non-operating expenses |  |  |
|  Interest expense | 14680 |  |
|  Foreign exchange loss | 57 | 14737 |
|  Ordinary income |  | 290422 |
|  Extraordinary losses |  |  |
|  Impairment loss | 3368 |  |
|  Loss on disposal of fixed assets | 1265 |  |
|  Settlement payment | 12500 | 17134 |
|  Income before income taxes |  | 273288 |
|  Income taxes – current | 161851 |  |
|  Income taxes – deferred | 5625 | 167476 |
|  Net income |  | 105811 |

---

(Note) Amounts less than ¥1 thousand are rounded down.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**Statement of Changes in Shareholders' Equity** 

*(For the fiscal year from March 1, 2025 to February 28, 2026)* 

(Unit: ¥ thousands)

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Common<br>Stock** | **Add'l Paid-**<br>**in Capital** | **Other<br>Capital<br>Surplus** | **Total<br>Capital<br>Surplus** | **Retained<br>Earnings** | **Treasury<br>Stock** | **Total<br>Shareholders'<br>Equity** | **Total Net<br>Assets** |
|  Balance at beginning of period | 751798 | 541798 | 1453300 | 1995098 | 1070318 | (85) | 3817130 | 3817130 |
|  Changes during the period |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net income |  |  |  |  | 105811 |  | 105811 | 105811 |
|  Total changes during the period |  |  |  |  | 105811 |  | 105811 | 105811 |
|  Balance at end of period | 751798 | 541798 | 1453300 | 1995098 | 1176130 | (85) | 3922941 | 3922941 |

---

(Note) Amounts less than ¥1 thousand are rounded down.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**INDEPENDENT AUDITOR'S REPORT** 

April 22, 2026

To the Board of Directors of VarioSecure Inc.:

Akasaka LLC Audit Corporation

Chiyoda-ku, Tokyo

**Audit Opinion** 

We have audited the financial statements of VarioSecure Inc. for the 11th fiscal year (March 1, 2025 to February 28, 2026), comprising the balance sheet, statement of Income, statement of changes in shareholders' equity, and notes thereto (collectively, the "Financial Statements"), and the related supplementary schedules, pursuant to Article 436, Paragraph 2, Item 1 of the Companies Act.

In our opinion, the Financial Statements present fairly, in all material respects, the financial position and results of operations of VarioSecure Inc. for the period covered thereby, in accordance with accounting principles generally accepted in Japan.

**Basis for Audit Opinion** 

We conducted our audit in accordance with auditing standards generally accepted in Japan. Our responsibilities under those standards are further described in the Auditor's Responsibilities section below. We are independent of the Company in accordance with the ethical requirements relevant to our audit under Japanese professional ethics requirements, and we have fulfilled our other ethical responsibilities. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

**Emphasis of Matter** 

As described in the note on significant subsequent events in the notes to the financial statements, the Company resolved at its Board of Directors' meeting held on April 14, 2026, to implement a share exchange with HEROZ, Inc. as the wholly-owning parent company and the Company as the wholly-owned subsidiary, and entered into a share exchange agreement on the same date. This share exchange is subject to approval at the 11th Annual Meeting of Shareholders scheduled for May 27, 2026. As a result of the share exchange, HEROZ, Inc. will become the Company's wholly-owning parent company, and the Company's shares are expected to be delisted from the TSE on June 26, 2026. This matter does not affect our audit opinion.

**Other Information** 

Other information refers to the Business Report and its supplementary schedules. Management is responsible for preparing and disclosing such other information. The Audit and Supervisory Committee is responsible for overseeing directors' performance of duties in the process of establishing and operating the financial reporting process with respect to other information. Our audit opinion does not cover other information, and we do not express any opinion thereon. Our responsibility in connection with the audit of the Financial Statements is to read the other information, and in doing so, consider whether there is a material inconsistency between the other information and the Financial Statements or our knowledge obtained in the audit, or whether there otherwise appears to be a material misstatement in the other information. We are required to report if we conclude, based on our work, that there is a material misstatement in the other information. We have no matter to report in this regard.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**Management's and Audit and Supervisory Committee's Responsibilities for the Financial Statements** 

Management is responsible for the preparation and fair presentation of the Financial Statements in accordance with accounting principles generally accepted in Japan, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is responsible for assessing the Company's ability to continue as a going concern and for disclosing matters related to going concern as required under accounting principles generally accepted in Japan. The Audit and Supervisory Committee is responsible for overseeing directors' performance of duties in the financial reporting process.

**Auditor's Responsibilities for the Audit of the Financial Statements** 

Our objectives are to obtain reasonable assurance about whether the Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Financial Statements.

As part of an audit in accordance with auditing standards generally accepted in Japan, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: identify and assess the risks of material misstatement; design and perform audit procedures responsive to those risks; select and apply audit procedures; and obtain sufficient appropriate audit evidence as a basis for our opinion. We also consider internal controls relevant to the audit in order to design audit procedures that are appropriate in the circumstances. We evaluate the appropriateness of accounting policies used, the reasonableness of accounting estimates made by management, and the adequacy of disclosures in the financial statements. We conclude on the appropriateness of management's use of the going concern basis and, based on audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. We communicate with the Audit and Supervisory Committee regarding, among other matters, the planned scope and timing of the audit and significant audit findings.

We also provided the Audit and Supervisory Committee with a statement that we have complied with applicable ethical requirements regarding independence and communicated all relationships and other matters that may reasonably be thought to bear on our independence.

**Conflicts of Interest** 

There are no interests between the Company and us or our engagement partners that are required to be disclosed pursuant to the Certified Public Accountants Act.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**AUDIT AND SUPERVISORY COMMITTEE REPORT** 

April 22, 2026

VarioSecure Inc. Audit and Supervisory Committee

The Audit and Supervisory Committee of VarioSecure Inc. has audited the execution of duties by directors during the 11th fiscal year (March 1, 2025 to February 28, 2026). The methods and results are reported below.

**1. Audit Methods and Scope** 

The Audit and Supervisory Committee received regular reports from directors and employees regarding the establishment and operation of the internal control system established pursuant to the Board of Directors' resolution on the matters set forth in Article 399-13, Paragraph 1, Items 1(b) and 1(c) of the Companies Act, sought explanations as necessary, expressed opinions, and conducted audits by the following methods:

(1) In accordance with audit policies and division of duties established by the Audit and Supervisory Committee, and in coordination with the internal audit department, the Committee attended important meetings, received reports from directors and employees regarding the execution of their duties, sought explanations as necessary, reviewed important approval documents, and investigated business operations and financial condition at the head office.

(2) The Committee monitored and verified that the independent auditor maintained its independence and conducted appropriate audits, received reports from the auditor regarding the performance of its duties, and sought explanations as necessary. The Committee also received notification from the auditor regarding the establishment of systems to ensure proper execution of professional duties under Article 131 of the Company Accounting Regulations, in accordance with the Auditing Standards for Quality Control, and sought explanations as necessary. The Committee also consulted with the independent auditor regarding key audit matters and received reports on audit execution status.

Based on the foregoing, the Committee reviewed the Business Report and its supplementary schedules, and the Financial Statements (balance sheet, statement of Income, statement of changes in shareholders' equity, and notes thereto) and their supplementary schedules for the current fiscal year.

**2. Audit Results** 

(1) Results of audit of the Business Report:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The Business Report and supplementary schedules fairly present the Company's condition in accordance with applicable laws and the Company's articles of incorporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) No material wrongdoing or material violation of law or the articles of incorporation was found in connection with the execution of duties by directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The content of the Board of Directors' resolution regarding the internal control system is appropriate. No issues were identified with respect to the descriptions of the internal control system in the Business Report or the directors' execution of duties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) No issues were identified with respect to transactions between the Company and its parent company and affiliates disclosed in the Business Report, including the precautions taken to avoid prejudice to the Company's interests and the Board of Directors' judgment regarding whether such transactions are prejudicial to the Company's interests.

(2) Results of audit of the Financial Statements:

We have determined that the audit methods and results of the independent auditor, Akasaka LLC Audit Corporation, are appropriate.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

(Note) Audit and Supervisory Committee members Keiko Hata, Kana Takahashi, and Motoi Moriwaki are outside directors as defined in Article 2, Item 15 and Article 331, Paragraph 6 of the Companies Act.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**REFERENCE DOCUMENTS FOR THE ANNUAL MEETING OF SHAREHOLDERS** 

**Proposal No. 1: Approval of the Share Exchange Agreement between VarioSecure Inc. and HEROZ, Inc.** 

VarioSecure Inc. (the "Company") and HEROZ, Inc. ("HEROZ," and together with the Company, the "Parties") resolved at their respective Boards of Directors' meetings held on April 14, 2026 to implement a management integration by way of a share exchange (the "Share Exchange"), with the objective of making HEROZ the wholly-owning parent company and the Company the wholly-owned subsidiary in the Share Exchange (the "Management Integration"), and entered into a Share Exchange Agreement (the "Share Exchange Agreement") on April 14, 2026.

We hereby request shareholder approval of the Share Exchange Agreement under this Proposal.

The Share Exchange will be implemented with an effective date of June 30, 2026 (the "Effective Date"), with HEROZ proceeding pursuant to the simplified share exchange procedures under Article 796, Paragraph 2 of the Companies Act (without shareholder approval) and the Company obtaining approval at this Annual Meeting of Shareholders.

The Company's common shares are scheduled to be delisted from the TSE Standard Market on June 26, 2026 (with the last trading day on June 25, 2026), prior to the Effective Date of June 30, 2026.

The reasons for the Share Exchange and a summary of its terms are as follows.

**1. Reasons for the Share Exchange** 

HEROZ operates AI-powered services in both B2C and B2B markets under its concept of "Surprise and Delight." In the AI market, investment in AI Transformation ("AIX") across industries has been accelerating since the launch of OpenAI's "ChatGPT," and the technological competition, demand expansion, and social implementation of AI—including Large Language Models (LLMs)—are advancing at an accelerating pace. HEROZ defines AIX as bringing about fundamental transformation of society as a whole—including existing business processes and models—by embedding AI into society and unleashing its power.

Within this context, the HEROZ Group has set its group strategy "AI BPaaS" under the brand "HEROZ 3.0," aiming to go beyond being a mere SaaS tool provider to deliver value in the form of "Agentic Work"—where AI autonomously executes and optimizes entire business processes using generative AI and multi-domain AI agents. Through this approach, HEROZ drives value creation across society and pursues business growth.

The HEROZ Group's two business segments are "AIX Business" and "AI Security Business." The AIX Business leverages the HEROZ Group's full suite of AI and SaaS-related technologies to advance the social implementation of AI and drive AIX across industries, and is divided into B2C and B2B services. The B2C service primarily provides the shogi app "Shogi Wars" to individual users. B2B services include HEROZ's AI solutions for the B2B market and its AI assistant SaaS "HEROZ ASK," along with businesses operated by consolidated subsidiaries StrategIT Co., Ltd., AI Squared, Inc., Tifana.com, Inc., and VOIQ Inc. The AI Security Business is the Company's internet security segment.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

The Company's vision is "Realizing a smart society where people can live with peace of mind." The Company's products and services protect mid-sized and SME businesses from threats; however, the Company's ultimate purpose is to protect the "everyday lives" of the individuals behind those businesses. By protecting companies' challenges behind the scenes through its products and services, the Company aims to create a robust social infrastructure where everyone can benefit safely and naturally from the advantages of ICT.

The Company's mission is "To be the unique and indispensable entity that supports social safety and security by delivering easy-to-use, high-quality security platforms to all mid-sized and SME enterprises." The Company provides managed security services, network and endpoint security, and integration services as part of its 24/365 WORK approach to security. For mid-sized and SME enterprises—which comprise the majority of Japanese businesses—advanced cybersecurity measures impose significant cost and operational burdens. The Company provides security platforms that are both "easy to implement" and of "high quality" through its technical expertise and support structure. By absorbing the complexity of underlying technology, the Company enables customers to focus on their core businesses while supporting social safety, continuously refining its unique "in-house development × managed services" model to create distinctive value that cannot be replicated by competitors. The Company provides network security deployment and managed operations services based on domestically developed, proprietary products. Products offered through managed security services include the integrated internet security service using the Company's proprietary dedicated device (VSR), the data backup service (VDaP), the endpoint security service (Vario EDR), and the Vario Managed LAN/Wi-Fi service. Integration services include the sale of VCR (Vario Communicate Router), a unified threat management (UTM) device for SMEs, and the Network Integration Service covering procurement and construction of network equipment.

The security services market in which the Company operates continues to expand due to the diversification of cyberattack threats, with enterprises increasingly outsourcing security operations and monitoring to security vendors due to the difficulty of managing sophisticated security measures in-house, driving growth in service adoption. In this market environment, the Internet Security Services business provides a one-stop service encompassing the deployment, management, operation, and maintenance of network security, and operates on a recurring revenue model in which fixed monthly fees (including initial fees) are collected from users, providing the Company with a stable revenue-generating business platform. The Company will continue to enhance its services and products in response to changes in the security environment.

(Reference) HEROZ Group Business Segments

---

| | | |
|:---|:---|:---|
| **Segment** | **AIX Business** | **AI Security Business** |
| Related Companies | HEROZ, Inc.<br> StrategIT Co., Ltd.<br> AI Squared, Inc.<br> Tifana.com, Inc.<br> VOIQ Inc. | VarioSecure Inc. |
| Business Description | Business leveraging AI solutions, AI SaaS, and AI BPaaS strategy to drive AIX and AI revolution across industries | Business providing managed security services for 24/365 WORK in security, network and endpoint security, and integration services, aiming to achieve advanced internet security |

---

Both companies' AIX Business and AI Security Business are experiencing rapid technological innovation. In the AIX Business, as LLM technology advances rapidly, the scope of generative AI applications is expanding at pace. HEROZ accordingly pursues its strategy to deliver "Agentic Work" value through its HEROZ ASK business, developing various AI agents toward early realization of AI BPaaS. In the AI Security Business, as cloud adoption, changing

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

work styles, and increasingly sophisticated cyberattacks create security threats that transcend corporate boundaries, expanding beyond traditional managed security services to endpoint security and backup services is becoming a critical strategic imperative. Looking ahead, the Company believes that delivering services enabling "Agentic Work"—where AI autonomously executes and optimizes entire business operations—using generative AI and multi-domain AI agents will be indispensable.

HEROZ determined that, in order to address these management challenges, it is essential not only to leverage the human capital and technology resources of both companies, but also to enable agile and flexible decision-making for each company's business growth, thereby achieving more efficient and nimble management for the HEROZ Group as a whole. The Parties entered into a capital and business alliance agreement in September 2022, through which HEROZ subscribed to the Company's third-party allotment increase and acquired approximately 43% of the Company's outstanding shares, making the Company a consolidated subsidiary.

Since then, while the Parties explored and partially advanced various cooperation initiatives in sales, technology, and corporate functions, the parent-subsidiary listing structure required constant consideration of conflicts of interest between the two companies, preventing full realization of anticipated synergies—including sales coordination between HEROZ ASK and the Company, new product development leveraging HEROZ's AI technology, and cost reduction through joint procurement and shared governance infrastructure.

HEROZ therefore concluded that, in the current highly competitive and rapidly evolving technological environment, maintaining the parent-subsidiary listing structure would make AI-driven business execution extremely inefficient or impractical, and that implementing the Management Integration to pursue early realization of AI agent services is essential for enhancing both companies' corporate value. Specifically, HEROZ envisions full-scale collaboration, including: cross-selling and cross-company proposals to customers through a holding company with group strategy functions; employee development through cross-business personnel exchanges among engineers, salespeople, and others; development of AI agents leveraging HEROZ's AI expertise and technology; and utilization of fundraising capacity and networks. HEROZ believes these initiatives will create business synergies such as AI-powered automation and efficiency improvements for the Company's services and development of new services leveraging HEROZ's AI agent technology.

HEROZ and the Company also believe that the HEROZ Group can maximize synergies for the full-scale growth of the AI Security Business through efficiency gains in back-office functions via shared infrastructure, advancement of core system renewal projects through coordination of IT departments, and cost reductions through joint procurement of various IT tools.

HEROZ has consistently maintained a policy of not excluding any option for enhancing corporate value, and has therefore evaluated various possibilities for the HEROZ Group's direction and the nature of its relationship with the Company. As a result of the foregoing analysis, HEROZ proposed the Management Integration to the Company in late October 2024, and both parties have since engaged in consultations and deliberations.

Upon receiving HEROZ's proposal for the Management Integration, the Company independently assessed the impact on stakeholders of delisting the Company's shares, including the benefits the Company had sought to achieve through its TSE listing in November 2020—including securing diverse and flexible funding channels, enhancing social credibility, and attracting talent and improving employee morale. The Company reached the conclusion that becoming a wholly-owned subsidiary of HEROZ through the Management Integration would maximize opportunities to enhance corporate value in existing business areas through shared infrastructure and back-office functions and active use of AI. With respect to the potential loss of benefits from listing, the Company concluded that: (i) while equity finance benefits would be lost, the Company would be able to access HEROZ Group financing as a Group member post-Share Exchange; (ii) social credibility would not immediately decline as the Company would become part of a TSE Standard Market-listed company's group; (iii) the impact on talent recruitment would be negligible as Company name recognition and credibility would be maintained to a certain degree as a member of the HEROZ Group, employment conditions are not expected to be adversely changed post-Share Exchange, and employees would benefit from working as part of the TSE-listed HEROZ Group; and accordingly, the benefits sought through the Company's listing would not be lost. The Company and HEROZ agreed that realizing the Management Integration would contribute to maximizing corporate value for the HEROZ Group as a whole, and on April 14, 2026, both Boards of Directors resolved to implement the Share Exchange to make the Company a wholly-owned subsidiary of HEROZ, and executed the Share Exchange Agreement.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

Through the Management Integration, the Parties will transform significantly into a major enterprise advancing the AI BPaaS strategy, while enhancing overall Group governance to maximize value for all stakeholders.

**2. Summary of the Share Exchange Agreement** 

The principal terms of the Share Exchange Agreement executed on April 14, 2026 are as follows:

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| | |
|:---|:---|
| **Item** | **Terms** |
| Wholly-Owning Parent (Share Exchange) | HEROZ, Inc. |
| Wholly-Owned Subsidiary (Share Exchange) | VarioSecure Inc. |
| Exchange Ratio | 0.99 HEROZ common share per 1 VarioSecure common share (HEROZ shares held by HEROZ are excluded from the allocation) |
| Shares to be Issued by HEROZ | HEROZ common shares: approximately 2,558,688 shares (expected) |
| Effective Date | June 30, 2026 (expected) |
| Dividend Restriction | Dividend and Treasury Share Restriction: Neither party shall resolve to pay dividends with a record date falling between the Agreement date and the Effective Date, nor shall either party resolve to acquire treasury shares (other than as required by law in connection with the exercise of shareholders' rights) with an acquisition date falling on or before the Effective Date. |

---

**3. Fairness of the Exchange Consideration** 

**(1) Exchange Ratio and Allocation** 

**(i) Allocation in the Share Exchange** 

---

| | | |
|:---|:---|:---|
|  | **HEROZ (Wholly-Owning**<br> **Parent)** | **VarioSecure (Wholly-Owned**<br> **Subsidiary)** |
| Share Exchange Ratio | 1 | 0.99 |
| HEROZ Shares to be Issued | 2,558,688 HEROZ common<br> shares (expected) |  |

---

(Notes) 1. Exchange Ratio: 0.99 HEROZ common shares will be allocated per 1 VarioSecure common share. No shares will be allocated for HEROZ's currently held VarioSecure shares (1,934,000 shares as of April 14, 2026). The exchange ratio may be adjusted by mutual agreement of the Parties if events materially affecting the ratio occur or come to light.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

2. Shares to be issued: HEROZ will deliver to VarioSecure shareholders (excluding HEROZ) the number of HEROZ common shares calculated based on the exchange ratio in exchange for their VarioSecure common shares at the reference time immediately prior to HEROZ's acquisition of all outstanding VarioSecure common shares (the "Reference Time"). The shares will be newly issued HEROZ common shares. The actual number of shares to be delivered may be adjusted, as the Company intends to cancel all treasury shares (4,427 shares as of April 14, 2026), including any shares acquired pursuant to dissenters' appraisal rights under Article 785, Paragraph 1 of the Companies Act, by Board resolution, immediately prior to the Reference Time.

3. Treatment of fractional shares: VarioSecure shareholders receiving an allocation of less than one unit (100 shares) of HEROZ common shares will not be able to sell such shares on the TSE, but may use HEROZ's share purchase program for fractional shares under Article 192, Paragraph 1 of the Companies Act.

4. Treatment of fractional shares of less than one share: VarioSecure shareholders receiving an allocation that includes a fraction of less than one HEROZ share will receive cash in lieu of such fractional shares in accordance with Article 234 of the Companies Act and other applicable law.

**(ii) Treatment of Outstanding Stock Acquisition Rights** 

All unexercised stock acquisition rights issued by the Company that remain unexercised on the day immediately preceding the Effective Date will be acquired by the Company at no consideration based on the call provisions of such rights and cancelled as of the Reference Time. The relevant stock acquisition rights are as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• 1st Series of Stock Acquisition Rights (Board resolution: May 16, 2017)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• 2nd Series of Stock Acquisition Rights (Board resolution: May 15, 2018)

The Company has not issued bonds with stock acquisition rights.

**(iii) Basis and Rationale for the Exchange Ratio** 

**(a) Basis and Rationale** 

To ensure the fairness and reasonableness of the exchange ratio in the Share Exchange, each party engaged an independent third-party financial advisor to provide a valuation of the exchange ratio. HEROZ engaged Plutus Consulting Co., Ltd. ("Plutus") and the Company engaged Maxus Corporate Advisory Inc. ("Maxus Corporate Advisory").

HEROZ, after carefully deliberating based on: (i) the valuation report on the exchange ratio received from Plutus on April 13, 2026; and (ii) legal advice from Mori Hamada & Matsumoto, determined that the exchange ratio is fair and not prejudicial to shareholders' interests, and concluded that it is appropriate to proceed with the Share Exchange at such ratio.

The Company, after carefully deliberating based on: (i) the valuation report on the exchange ratio and fairness opinion received from Maxus Corporate Advisory on April 13, 2026 stating that the exchange ratio is fair from a financial point of view to the Company's shareholders; (ii) legal advice from Anderson Mori & Tomotsune; and (iii) the written opinion ("Advisory Report") received on April 14, 2026 from the Special Committee established in accordance with the procedures described in Section (3) "Measures Taken to Protect Shareholders' Interests" below, determined that the exchange ratio is not prejudicial to shareholders' interests, and concluded that it is appropriate to proceed with the Share Exchange at such ratio.

In addition, taking into account the results of the due diligence conducted in connection with the Management Integration and considering factors including financial condition, asset condition, and future outlook, and through careful negotiation and deliberation of the exchange ratio, both Parties concluded on April 14, 2026 that the final exchange ratio is fair and in the interests of their respective shareholders, and resolved to execute the Share Exchange Agreement including the exchange ratio.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

The exchange ratio may be adjusted upon mutual agreement of the Parties if there is a material change in the underlying conditions.

**(b) Valuation Details** 

**(i) Names of Advisors and Their Relationships with the Parties** 

Plutus (HEROZ's financial advisor) and Maxus Corporate Advisory (the Company's financial advisor) are each independent of both Parties, are not related parties of either Party, and have no material conflicts of interest with respect to the Share Exchange. Plutus's fee is a fixed retainer payable regardless of the outcome of the transaction, with no success fee. Maxus Corporate Advisory's fee includes a success fee contingent on the consummation of the transaction; however, considering general market practice for comparable transactions, such success fee does not negate its independence.

**(ii) Valuation Summary** 

**(a) Valuation by Plutus** 

Since both HEROZ and the Company are listed on the TSE Standard Market and have observable market prices, Plutus applied the Market Price Method and the Discounted Cash Flow (DCF) Method to value each company's shares. The exchange ratio ranges (expressed as the value per HEROZ share equal to 1) are as follows:

---

| | |
|:---|:---|
| **Method** | **Exchange Ratio Range** |
| Market Price Method | 0.87 – 0.89 |
| DCF Method | 0.69 – 1.10 |

---

For the Market Price Method, using April 13, 2026 as the reference date, Plutus used the closing price and the simple averages of closing prices over the 1-month, 3-month, and 6-month periods ending on the reference date for both HEROZ and the Company on the TSE Standard Market.

For the DCF Method, Plutus discounted the projected free cash flows of HEROZ (based on HEROZ's financial projections for FY2026–FY2029) and the Company (based on the Company's financial projections for FY2027–FY2029) to present value using a discount rate to derive enterprise value. Terminal value was calculated using the perpetuity growth model. The discount rate for HEROZ was 10.7%–13.1% with a terminal growth rate of 0%; the discount rate for the Company was 8.8%–11.9% with a terminal growth rate of 0%. HEROZ's projections reflect a significant year-over-year increase in profits and free cash flow in certain fiscal years, driven primarily by expansion of existing AIX services and improved profitability from Group-wide operational efficiency gains. The Company's projections reflect a significant year-over-year increase in profits and free cash flow in FY2028/2 due to front-loaded investments in new service development and sales force expansion, and in FY2029/2 due to reduced capital expenditures as initial investments normalize. Neither company's projections assume the completion of the Share Exchange.

In preparing the above valuation of the exchange ratio, Plutus used information provided by both Parties and publicly available information as provided, and assumed that all materials and information subject to its analysis and review were accurate and complete, without independently verifying such accuracy or completeness. Plutus did not independently evaluate, appraise, or assess any individual assets or liabilities (including contingent liabilities) of either Party or their affiliates, nor did it request any third-party appraisal or assessment thereof. Plutus's valuation of the exchange ratio reflects information and economic conditions available as of the valuation reference date. The financial projections of each Party (including profit plans and other information) were assumed to have been reasonably reviewed or prepared based on the best estimates and judgments currently available to the management of each Party.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**(b) Valuation by Maxus Corporate Advisory** 

Since both HEROZ and the Company are listed on the TSE Standard Market, Maxus Corporate Advisory applied the Market Price Average Method and the DCF Method to value each company's shares. The exchange ratio ranges are as follows:

---

| | |
|:---|:---|
| **Method** | **Exchange Ratio Range** |
| Market Price Average Method | 0.87 – 0.89 |
| DCF Method | 0.72 – 1.10 |

---

For the Market Price Average Method, using April 13, 2026 as the reference date, Maxus Corporate Advisory used the closing price and simple averages of closing prices over the 1-month, 3-month, and 6-month periods ending on the reference date for both HEROZ and the Company.

For HEROZ's DCF valuation, based on HEROZ's business plan for FY2026/4 through FY2029/4, the results of due diligence conducted by the Company, publicly available information, and other factors, Maxus Corporate Advisory applied a Sum-of-the-Parts (SOTP) analysis to appropriately reflect the distinct characteristics of HEROZ's AIX Business and AI Security Business. For the AIX Business, the WACC was 9.7%–10.7% (incorporating a size risk premium), with terminal value calculated using the perpetuity growth model at a terminal growth rate of 0.0%–1.0%, yielding a terminal value of ¥11,959 million to ¥15,272 million. The AI Security Business was valued based on the DCF valuation of the Company multiplied by HEROZ's shareholding.

For the Company's DCF valuation, Maxus Corporate Advisory discounted projected free cash flows from FY2027/2 onward. The WACC was 9.1%–10.1% (incorporating a size risk premium), with terminal value at a terminal growth rate of 0.0%–1.0%, yielding a terminal value of ¥3,862 million to ¥4,994 million.

Maxus Corporate Advisory's DCF projections for both companies include fiscal years with significant year-over-year profit growth, for the same reasons described in Plutus's analysis above. Neither company's projections assume the completion of the Share Exchange.

The Company's business plan underlying Maxus Corporate Advisory's DCF analysis was prepared by the Company in connection with its review of the Share Exchange. The business plan was prepared by formulating revenue forecasts and investment plans taking into account the business performance of the Internet Security Services business through FY2026/2 and incorporating the business investments necessary for future business growth. HEROZ was not involved in the specific process of preparing the numerical figures in the plan. The Special Committee confirmed that the Company's business plan was prepared by persons independent from HEROZ, received explanations regarding the material assumptions, and after confirming the reasonableness of the content, material assumptions, and preparation process of the final business plan, approved the plan.

In preparing the above valuation of the exchange ratio, Maxus Corporate Advisory used information provided by both Parties, information obtained through hearings, and publicly available information as provided, and assumed that all such materials and information were accurate and complete, that there were no facts or circumstances that could have a material impact on the valuation of the exchange ratio, and that no undisclosed facts existed, without independently verifying such accuracy or completeness. Maxus Corporate Advisory did not independently evaluate or appraise any individual assets or liabilities (including derivative transactions, off-balance sheet assets and liabilities, and other contingent liabilities) of either Party or their affiliates, nor did it request any third-party evaluation, appraisal, or assessment thereof. The financial projections of both Parties referenced in such valuation were assumed to have been reasonably prepared based on the best estimates and judgments currently available to the persons who prepared each Party's business plan, and such valuation was based on information and economic conditions as of April 13, 2026.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

The Company's financial projections underlying Maxus Corporate Advisory's DCF analysis are presented below:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **(¥ millions)** | **FY2027/2** | **FY2027/2** | **FY2028/2** | **FY2028/2** | **FY2029/2** | **FY2029/2** |
|  Net Revenue |  | 2965 |  | 3246 |  | 3670 |
|  Operating Income |  | 460 |  | 640 |  | 751 |
|  EBITDA |  | 695 |  | 911 |  | 1060 |
|  Free Cash Flow |  | 222 |  | 169 |  | 555 |

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Maxus Corporate Advisory also delivered to the Company a fairness opinion dated April 13, 2026, stating that, in its opinion and subject to certain assumptions, the exchange ratio in the Share Exchange is fair from a financial point of view to the Company's general shareholders. (Note) The fairness opinion states that, based on the market price average method and DCF method analyses described above, the exchange ratio agreed upon by the Parties is fair from a financial point of view to the Company's general shareholders. The financial projections underlying the DCF analysis do not take into account any synergies expected to result from the Share Exchange.

In rendering its opinion in the fairness opinion, Maxus Corporate Advisory adopted publicly available information and information provided by both Parties as accurate and complete, and has not independently verified such accuracy or completeness. Maxus Corporate Advisory has assumed that the persons who prepared each Party's business plan were not aware of any facts or circumstances that would render such information inaccurate or misleading in any material respect. The business plans of both Parties were assumed to have been reasonably prepared based on the best estimates and judgments currently available to the persons who prepared each Party's business plan. Maxus Corporate Advisory has not independently verified the feasibility of either Party's business plan, has relied on such plans, and does not express any opinion regarding the content or underlying assumptions of such plans.

The opinion expressed in the fairness opinion is based on information available as of April 13, 2026. If facts arise that render the information obtained materially erroneous, or if circumstances change thereafter, such changes may affect the opinion expressed in the fairness opinion. Maxus Corporate Advisory has not independently evaluated or appraised the assets or liabilities (including, without limitation, off-balance sheet assets and liabilities and other contingent liabilities) of either Party or their affiliates. Maxus Corporate Advisory has no obligation to conduct a physical inspection of the assets of either Party, nor has it evaluated the solvency or fair value of either Party under applicable bankruptcy, corporate reorganization, civil rehabilitation, special liquidation, or other insolvency proceedings.

With respect to any information requested by Maxus Corporate Advisory from either Party that was not provided or disclosed and could not otherwise be obtained for use as a basis for valuation, Maxus Corporate Advisory has, with the consent of the Company, used assumptions that Maxus Corporate Advisory considered reasonable and appropriate. Maxus Corporate Advisory has not independently verified the impact on the future financial condition of either Party if such assumptions prove to be materially different from actual facts.

Maxus Corporate Advisory has assumed, without independent verification, that the Share Exchange will be completed in a timely manner without material changes to its terms, that necessary governmental and regulatory approvals or consents will be obtained without delays, restrictions, or conditions that could adversely affect the expected benefits of the Share Exchange, and that the content of such approvals and consents will not affect the exchange ratio. It is also assumed that neither Party has exchanged, nor will exchange in the future, any agreements or documents that would materially affect the exchange ratio. Maxus Corporate Advisory has confirmed with both Parties and assumed that, in addition to information provided or disclosed by both Parties, there are no contingent liabilities or off-balance sheet liabilities that would materially affect the exchange ratio.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

The fairness opinion is not intended to, and does not constitute, advice to the Company regarding whether to approve the Share Exchange. Furthermore, the fairness opinion does not express any opinion or view regarding the relative merits of the Share Exchange compared to other strategies or transactions that the Company may be able to utilize or execute, or regarding the business decision underlying the Company's decision to execute or continue the Share Exchange. The fairness opinion does not express any opinion or recommendation regarding how shareholders should vote or act with respect to the Share Exchange or any related matters. Maxus Corporate Advisory does not express any opinion regarding the price at which or at which the shares of either Party should be traded prior to the effectiveness of the Share Exchange.

Maxus Corporate Advisory's opinion is based on the financial, economic, market, and other conditions in effect, and information available to Maxus Corporate Advisory, as of April 13, 2026. Events occurring after such date may affect the opinion expressed in the fairness opinion and the assumptions used in preparing it; however, Maxus Corporate Advisory assumes no obligation to update, revise, or reconfirm the fairness opinion.

**(2) Rationale for Selecting HEROZ Shares as Exchange Consideration** 

The Company and HEROZ selected HEROZ common shares as the exchange consideration in the Share Exchange. As HEROZ is listed on the TSE Standard Market, its shares will remain tradable on such market after the Effective Date, and the Company's shareholders will be able to benefit from the synergies arising from the Share Exchange. Accordingly, the Company believes this selection is appropriate.

Upon the Effective Date of the Share Exchange (expected June 30, 2026), the Company will become a wholly-owned subsidiary of HEROZ and its common shares will be delisted from the TSE Standard Market pursuant to TSE delisting standards on June 26, 2026. After delisting, the Company's common shares will no longer be tradable on the TSE; however, HEROZ common shares received by the Company's shareholders in the Share Exchange will remain listed on the TSE Standard Market and will be tradable after the Effective Date.

Shareholders of the Company who receive an allocation of 100 or more HEROZ common shares will be able to trade at least one unit of shares on the TSE Standard Market (though partial fractional allocations may occur). Shareholders who receive fewer than 100 HEROZ shares will become fractional shareholders of HEROZ. Fractional shares cannot be sold on a stock exchange but may be tendered to HEROZ's fractional share repurchase program. For details, please refer to the relevant section under Proposal No. 1, Section 3(1)(i)(Note 3).

For details on the treatment of fractions of less than one share, please refer to Proposal No. 1, Section 3(1)(i)(Note 4).

Shareholders of the Company may continue to trade their Company shares on the TSE Standard Market as usual through the last trading day of June 25, 2026 (expected), and may exercise their legally prescribed rights until the Reference Time.

**(3) Measures to Protect Shareholders' Interests** 

Since HEROZ already holds 1,934,000 shares of the Company's common stock (representing 42.8% of the Company's issued and outstanding shares as of April 14, 2026) and the Company qualifies as a consolidated subsidiary of HEROZ, both parties determined that it was necessary to ensure the fairness of the exchange ratio and implemented the following measures to ensure fairness (including measures to avoid conflicts of interest):

**(i) Engagement of Independent Third-Party Financial Advisors and Fairness Opinion** 

To ensure the fairness and reasonableness of the exchange ratio, HEROZ engaged Plutus, and the Company engaged Maxus Corporate Advisory, to each provide a valuation report on the exchange ratio. The Company also obtained a fairness opinion from Maxus Corporate Advisory stating that the exchange ratio is fair from a financial point of view to the Company's shareholders. Please refer to Section 3(1)(iii)(b) for summaries of the valuation reports and fairness opinion. Plutus and Maxus Corporate Advisory are each independent of both Parties and have no material conflicts of interest with either Party.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**(ii) Engagement of Independent Legal Advisors** 

HEROZ engaged Mori Hamada & Matsumoto as its legal advisor, receiving legal advice on the procedures and the Board's decision-making process. The Company engaged Anderson Mori & Tomotsune as its legal advisor, receiving legal advice on the procedures and the Board's decision-making process. Both law firms are independent of both Parties and have no material conflicts of interest.

**(iii) Establishment of and Receipt of Report from an Independent Special Committee** 

**(a) Background** 

Upon receiving the Management Integration proposal from HEROZ in late October 2024 and commencing specific deliberations regarding the Share Exchange, the Company established a Special Committee (the "Special Committee") on November 15, 2024, consisting of three (3) outside directors serving as Audit and Supervisory Committee members—Keiko Hata, Kana Takahashi, and Motoi Moriwaki—each of whom is independent from HEROZ and from the outcome of the Share Exchange and has been designated as an independent officer with the TSE. Ms. Takahashi was elected as chair by the Special Committee members. Special Committee compensation is based on time spent and is not contingent on the outcome of or the content of any report on the Share Exchange.

The Company referred the following matters to the Special Committee: (a) whether the purpose of the Share Exchange is reasonable (including whether it contributes to the Company's corporate value); (b) whether the terms and conditions of the Share Exchange (including the exchange ratio) are fair; (c) whether sufficient consideration has been given to the interests of the Company's general shareholders through fair procedures; and (d) whether, taking into account the foregoing (a) through (c), the Share Exchange is not prejudicial to the Company's general shareholders. (Pursuant to TSE amendments to the Securities Listing Regulations effective July 22, 2025, the Company revised matters (c) and (d) at its Board meeting of August 19, 2025 to reference "general shareholders" instead of "minority shareholders." The revised matters are collectively referred to herein as the "Referred Matters.") The Board of Directors resolved to: (x) accord maximum respect to the Special Committee's findings in making the Board's decision; and (y) not consent to the transaction if the Special Committee determines that the terms are not appropriate.

The Board also granted the Special Committee the authority to: (i) confirm the negotiation strategy with respect to the Share Exchange terms (including the exchange ratio) in advance, receive timely updates on negotiations, and express opinions, instructions, and requests at critical junctures, thereby having substantive influence over or participation in the negotiation process; (ii) approve (including retroactive approval) the Company's advisors and engage its own independent advisors at the Company's expense; and (iii) if the Special Committee deems it necessary, directly negotiate the terms of the transaction. (The authority in (i) was updated at the Board meeting of March 17, 2026 to add the right for the Special Committee, if it deems necessary, to directly conduct deliberations and negotiations on transaction terms.)

**(b) Deliberation Process** 

The Special Committee held a total of 51 meetings between November 15, 2024 and April 14, 2026, and also engaged in information gathering and deliberations via email and other means between meetings.

The Special Committee confirmed the independence and expertise of Maxus Corporate Advisory (the Company's financial advisor) and Anderson Mori & Tomotsune (the Company's legal advisor) and approved their engagement. The Special Committee determined not to engage its own separate advisors. The Special Committee received explanations from both Parties regarding the purpose of the Share Exchange, its background, expected synergies, post-merger management policies, and treatment of employees, and engaged in Q&A sessions. The Committee sent written questions to HEROZ on seven (7) occasions between December 2024 and April 2026 and received responses. The Committee also received explanations from the Company regarding the preparation process and content of the Company's business plan used as the basis for the exchange ratio valuation. The Committee received legal advice from

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

Anderson Mori & Tomotsune regarding the Board's decision-making process, Special Committee operations, and fairness procedures. The Committee received a presentation from Maxus Corporate Advisory on its valuation methodology and results and engaged in Q&A sessions. The Special Committee was substantially involved in the negotiation process with HEROZ through multiple rounds of deliberations on negotiation strategy and expressions of opinions regarding the exchange ratio.

**(c) Findings** 

After carefully deliberating the Referred Matters through the foregoing process, the Special Committee unanimously submitted a written opinion to the Company's Board of Directors on April 14, 2026, concluding that the Share Exchange is fair to the Company's general shareholders. The full text of the opinion is included as an attachment to the press release dated April 14, 2026 entitled "Notice Regarding Management Integration of HEROZ, Inc. and VarioSecure Inc."

**(iv) Unanimous Approval by Disinterested Directors** 

At the Company's Board of Directors' meeting held on April 14, 2026, of the seven (7) directors (including three (3) Audit and Supervisory Committee members), three directors—Takahiro Hayashi, Keiichi Iguchi, and Hiroya Mori—were excluded from deliberation and voting because they concurrently serve as directors of HEROZ, and the remaining four (4) directors unanimously approved the Share Exchange. These three directors also did not participate in any negotiations with HEROZ on the Company's behalf.

**(v) Independent Review Structure** 

The Company established an internal structure to examine, negotiate, and determine matters relating to the Share Exchange independently of HEROZ. Specifically, from the date of receipt of HEROZ's proposal in late October 2024, the Company ensured that all deliberations, negotiations with HEROZ, and preparation of the business plan used as the basis for the exchange ratio valuation were conducted by a team that excluded any persons with concurrent positions at HEROZ (including Directors Hayashi, Iguchi, and Mori) and any persons seconded from or transferred from HEROZ. The Special Committee confirmed the independence of this structure at its meeting held on June 30, 2025. The Special Committee has confirmed that there are no issues with the Company's review structure from the perspective of independence and fairness, including the foregoing arrangements.

**(4) Fairness of Capital and Reserve Amounts of HEROZ (the Wholly-Owning Parent)** 

The amounts of capital stock, legal capital surplus, and retained earnings surplus to be increased by HEROZ as a result of the Share Exchange shall be determined by HEROZ in accordance with Article 39 of the Company Accounting Regulations, taking into consideration HEROZ's financial condition, capital policies, and other circumstances, within the limits prescribed by law. The Company has determined that this treatment is appropriate.

**4. Reference Information Regarding the Exchange Consideration** 

**(1) Articles of Incorporation of HEROZ** 

HEROZ's articles of incorporation have been posted in accordance with the Company's articles of incorporation (Article 15) and applicable law on the Company's website (https://www.variosecure.net/ir/library4/), the shareholder meeting materials posting website (https://d.sokai.jp/4494/teiji/), and the TSE website (https://www2.jpx.co.jp/tseHpFront/JJK010010Action.do?Show=Show).

**(2) Market for Trading the Exchange Consideration** 

(i) HEROZ shares are listed and traded on the TSE Standard Market.

(ii) HEROZ shares are brokered by securities firms across Japan.

(iii) Transfer restrictions: Not applicable.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**(3) Market Price of the Exchange Consideration** 

The average closing prices of HEROZ shares on the TSE Standard Market for the 1-month, 3-month, and 6-month periods ending on April 13, 2026 (the business day immediately preceding the announcement of the Share Exchange Agreement on April 14, 2026) were ¥844, ¥838, and ¥875, respectively. Market price information for HEROZ shares is available on the TSE website (https://www.jpx.co.jp/).

**(4) Financial Statements of HEROZ for the Past Five Fiscal Years** 

HEROZ has filed annual securities reports (Yukashoken Hokokusho) pursuant to Article 24, Paragraph 1 of the Financial Instruments and Exchange Act for each of the most recent five fiscal years; accordingly, description of such financial statements is omitted herein.

**5. Matters Regarding Stock Acquisition Rights in the Share Exchange** 

Not applicable.

All outstanding stock acquisition rights of the Company as of the Reference Time will be acquired by the Company at no consideration, subject to approval of the Share Exchange Agreement at the Company's Annual Meeting of Shareholders, and cancelled as of the Reference Time. The Company has not issued bonds with stock acquisition rights.

**6. Financial Statements** 

**(1) HEROZ's Financial Statements for the Most Recent Fiscal Year** 

HEROZ's financial statements for the most recent fiscal year (FY2025, ending April 2025) are posted in accordance with applicable law and the Company's articles of incorporation (Article 15) on the Company's website (https://www.variosecure.net/ir/library4/), the shareholder meeting materials posting website (https://d.sokai.jp/4494/teiji/), and the TSE website.

**(2) Material Events Occurring After the Most Recent Fiscal Year-End** 

**(i) The Company** 

**(a) Execution of the Share Exchange Agreement** 

By resolution of the Company's Board of Directors on April 14, 2026, the Company determined to implement the Share Exchange with HEROZ as the wholly-owning parent and the Company as the wholly-owned subsidiary, and executed the Share Exchange Agreement on the same date. Please refer to Section 2 above for a summary of the Share Exchange Agreement.

**(b) Cancellation of Treasury Shares** 

By resolution of the Company's Board of Directors prior to the day preceding the Effective Date, the Company intends to cancel all treasury shares held immediately prior to the Reference Time (including any shares acquired pursuant to dissenters' appraisal rights under Article 785, Paragraph 1 of the Companies Act) as of the Reference Time.

**(ii) HEROZ** 

**(a) Execution of the Share Exchange Agreement** 

By resolution of HEROZ's Board of Directors on April 14, 2026, HEROZ determined to implement the Share Exchange with HEROZ as the wholly-owning parent and the Company as the wholly-owned subsidiary, and executed the Share Exchange Agreement on the same date.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**(b) Execution of Share Transfer Agreement** 

By resolution of HEROZ's Board of Directors held on April 20, 2026, HEROZ entered into a share transfer agreement on the same date to sell all shares (79,499 shares) of its consolidated subsidiary StrategIT Co., Ltd. held by HEROZ to GMO GlobalSign Holdings K.K. The transfer price is ¥424,604 thousand, and the transfer is expected to be completed on April 30, 2026.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**Share Exchange Agreement (Copy)** 

HEROZ, Inc. ("Party A") and VarioSecure Inc. ("Party B") enter into the following Share Exchange Agreement (this "Agreement") on April 14, 2026 (the "Execution Date").

Article 1 (Share Exchange)

Party A and Party B shall, in accordance with this Agreement, effect a share exchange (the "Share Exchange") with Party A as the wholly-owning parent company and Party B as the wholly-owned subsidiary company, pursuant to which Party A shall acquire all issued shares of Party B (excluding shares held by Party A; the same applies hereinafter).

Article 2 (Corporate Name and Address)

(1) Party A (Wholly-Owning Parent Company): HEROZ, Inc., 5-31-17 Shiba, Minato-ku, Tokyo, PMO Tamachi

(2) Party B (Wholly-Owned Subsidiary Company): VarioSecure Inc., 1-6 Kanda Nishikicho, Chiyoda-ku, Tokyo

Article 3 (Shares to Be Delivered and Allocation)

(1) In the Share Exchange, Party A shall deliver to Party B's shareholders (as of immediately prior to the Reference Time, after cancellation of treasury shares pursuant to Article 9, Paragraph 2, excluding Party A) HEROZ common shares in lieu of Party B common shares, in a number calculated by multiplying the aggregate number of Party B common shares held by such shareholders by 0.99.

(2) In the Share Exchange, Party A shall allocate to Party B's shareholders as of the Reference Time HEROZ common shares at a ratio of 0.99 HEROZ common share per one (1) Party B common share held by such shareholders (such ratio hereinafter referred to as the "Exchange Ratio").

(3) In the event that the number of Party A common shares to be allocated to Party B's shareholders pursuant to the preceding two paragraphs includes a fraction of less than one (1) share, Party A shall handle such fraction in accordance with Article 234 of the Companies Act and other applicable laws and regulations.

Article 4 (Capital and Reserves of Party A)

The amounts of capital stock, legal capital surplus, and retained earnings surplus to be increased by Party A shall be determined by Party A in accordance with Article 39 of the Company Accounting Regulations.

Article 5 (Effective Date)

The Effective Date of the Share Exchange shall be June 30, 2026. The Effective Date may be changed by mutual agreement of the Parties if necessary for procedural or other reasons.

Article 6 (Shareholder Approval)

Party A shall implement the Share Exchange without obtaining shareholder approval pursuant to Article 796, Paragraph 2 of the Companies Act; provided, however, that if shareholder approval becomes required under Article 796, Paragraph 3, Party A shall seek shareholder approval by the day preceding the Effective Date. Party B shall seek shareholder approval for this Agreement and other necessary matters at a general meeting of shareholders held by the day preceding the Effective Date pursuant to Article 783, Paragraph 1 of the Companies Act.

Article 7 (Conduct of Business)

From the Execution Date until the Effective Date, Party A and Party B (and their respective subsidiaries, excluding Party B and its subsidiaries with respect to Party A) shall manage their affairs with the care of a prudent manager. Except as otherwise provided in this Agreement, neither party shall, and shall not cause its subsidiaries to, take any action that poses a specific risk of materially affecting the implementation of the Share Exchange or the Exchange Ratio, unless such party has consulted with the other party in advance and obtained written agreement from such other party.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

Article 8 (Dividends)

Neither Party A nor Party B shall resolve to pay dividends with a record date falling between the Execution Date and the Effective Date, or to acquire treasury shares (other than as required by law in connection with the exercise of shareholders' rights) with an acquisition date falling before the Effective Date.

Article 9 (Cancellation of Stock Acquisition Rights and Treasury Shares)

Upon approval of this Agreement at Party B's general meeting of shareholders (and, if Party A's shareholder approval is required under Article 6 proviso, at both parties' shareholder meetings), Party B shall take all necessary actions (including passing a resolution at Party B's Board of Directors for the cancellation of such stock acquisition rights) to (a) acquire at no consideration, with the approval of this Agreement at Party B's general meeting of shareholders as the trigger for such acquisition, all outstanding stock acquisition rights of Party B as of the Reference Time by the day preceding the Effective Date, and cancel them as of the Reference Time; and (b) cancel by Board resolution all treasury shares held by Party B as of the Reference Time (including shares acquired pursuant to dissenters' appraisal rights under Article 785, Paragraph 1 of the Companies Act) immediately prior to the Reference Time.

Article 10 (Amendment or Termination)

If events materially obstructing the implementation of the Share Exchange occur or become apparent between the Execution Date and the Effective Date, or if the purpose of this Agreement otherwise becomes difficult to achieve, the Parties may by mutual agreement amend the terms of the Share Exchange, suspend the Share Exchange, or terminate this Agreement.

Article 11 (Termination of Agreement)

This Agreement shall terminate upon: (i) failure to obtain Party B shareholder approval by the day preceding the Effective Date; (ii) failure to obtain Party A shareholder approval where required under Article 6 proviso; (iii) failure to obtain required governmental or regulatory approvals prior to the Effective Date; or (iv) termination pursuant to Article 10.

Article 12 (Governing Law and Jurisdiction)

This Agreement shall be governed by and construed in accordance with the laws of Japan. The Tokyo District Court shall have exclusive jurisdiction over any disputes arising in connection with this Agreement.

Article 13 (Miscellaneous)

Any matters not set forth in this Agreement, or any ambiguity regarding the contents hereof, shall be resolved by good-faith consultation between the Parties.

IN WITNESS WHEREOF, the Parties have executed two (2) original counterparts of this Agreement, each party retaining one (1) original, as of April 14, 2026.

Party A: HEROZ, Inc., 5-31-17 Shiba, Minato-ku, Tokyo PMO Tamachi

President and Representative Director (CEO): Takahiro Hayashi

Party B: VarioSecure Inc., 1-6 Kanda Nishikicho, Chiyoda-ku, Tokyo

President and Representative Director: Shoichi Onoe

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**Proposal No. 2: Election of Four (4) Directors (Excluding Audit and Supervisory Committee Members)** 

The terms of four (4) directors (excluding Audit and Supervisory Committee members) will expire at the conclusion of this Annual Meeting. We therefore request the election of four (4) directors (excluding Audit and Supervisory Committee members). This proposal was reviewed and approved by the Nomination Committee, which is comprised of a majority of independent outside directors.

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| | | |
|:---|:---|:---|
| **No.** | **Name (Date of Birth)** | **Career Summary and Significant Concurrent Positions** |
| 1 | Tomohiro Takahashi (Born: Dec. 30, 1976) | Apr. 1999: Joined NEC Corporation (BIGLOBE Division, Corporate Planning Dept.) Apr. 2009: Co-founded HEROZ, Inc.; Representative Director (COO) Jul. 2023: Director (CRO) of HEROZ, Inc. (current) Mar. 2024: Director of Tifana.com, Inc. (current) May 2025: Director of VOIQ Inc. (current) Significant Concurrent Positions: Tifana.com, Inc. – Director VOIQ Inc. – Director |
| 2 | Takahiro Hayashi (Born: Dec. 20, 1976) | Joined NEC Corporation (IT Strategy Dept., Corporate Planning Dept.) Co-founded HEROZ, Inc.; President and Representative Director (CEO) (current) StrategIT Co., Ltd. – Director (current) VarioSecure Inc. – Director (current) Rakumachi Inc. (formerly First Logic Inc.) – Outside Director (current) AI Squared, Inc. – Director (current) Tifana.com, Inc. – Director (current) VOIQ Inc. – Director (current) Significant Concurrent Positions: HEROZ, Inc. – President and Representative Director (CEO) StrategIT Co., Ltd. – Director Rakumachi Inc. – Outside Director AI Squared, Inc. – Director Tifana.com, Inc. – Director VOIQ Inc. – Director |
| 3 | Keiichi Iguchi (Born: Jul. 19, 1978) | Joined NEC Corporation (Central Research Laboratory) Joined Donuts Inc. – Development Manager Founded Ginger Inc. – Director Joined HEROZ, Inc. – Development Manager HEROZ, Inc. – Director (CTO) (current) VarioSecure Inc. – Outside Director; subsequently Director (current) VOIQ Inc. – Director (current) Significant Concurrent Positions: HEROZ, Inc. – Director (CTO) VOIQ Inc. – Director |
| 4 | Hiroya Mori (Born: Oct. 19, 1973) | Joined Century Audit Corporation (now EY Shin Nihon LLC) Joined Intellaset Inc. Joined Intelligence Inc. (now Persol Career Co., Ltd.) Transferred to Temp Holdings Co., Ltd. (now Persol Holdings Co., Ltd.) – Group CFO Joined HEROZ, Inc. – Executive Officer (CFO) StrategIT Co., Ltd. – Director (current) VarioSecure Inc. – Director (current) HEROZ, Inc. – Director (CFO) (current) AI Squared, Inc. – Director (current) Tifana.com, Inc. – President and Representative Director (current) VOIQ Inc. – Director (current) Significant Concurrent Positions: HEROZ, Inc. – Director (CFO) StrategIT Co., Ltd. – Director AI Squared, Inc. – Director Tifana.com, Inc. – President and Representative Director VOIQ Inc. – Director |

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(Notes)

1. Tomohiro Takahashi is the Representative Director (CRO) of HEROZ, Inc., which has entered into a capital and business alliance agreement with the Company.

2. Takahiro Hayashi is the President and Representative Director (CEO) of HEROZ, Inc., which has entered into a capital and business alliance agreement with the Company.

3. Keiichi Iguchi is a Director (CTO) of HEROZ, Inc., which has entered into a capital and business alliance agreement with the Company.

4. Hiroya Mori is a Director (CFO) of HEROZ, Inc., which has entered into a capital and business alliance agreement with the Company.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

5. There are no material conflicts of interest between any nominees other than the four listed above and the Company.

6. The Company has entered into liability limitation agreements with Takahiro Hayashi, Keiichi Iguchi, and Hiroya Mori pursuant to Article 427, Paragraph 1 of the Companies Act. If their reappointment is approved, these agreements will continue. If Tomohiro Takahashi's appointment is approved, the Company intends to enter into a similar agreement with him. The maximum liability under such agreements is the amount prescribed by applicable law.

7. The Company has entered into a D&O liability insurance policy covering directors; if elected, all nominees will be included as insured parties. The policy is expected to be renewed on substantially the same terms.

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**Proposal No. 3: Election of Three (3) Directors Who Are Members of the Audit and Supervisory Committee** 

The terms of three (3) directors serving as Audit and Supervisory Committee members will expire at the conclusion of this Annual Meeting. We therefore request the election of three (3) such directors. This proposal has been approved by the Audit and Supervisory Committee.

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| | | |
|:---|:---|:---|
| **No.** | **Name (Date of Birth)** | **Career Summary, Reason for Nomination, and Significant Concurrent Positions** |
| 1 | Keiko Hata (Born: Jan. 6, 1971) [Outside/Independent] | Apr. 1994: Joined Japan Air Self-Defense Force (Ministry of Defense) May 2007: Joined Fukuoka SoftBank Hawks Corp. May 2008: Joined Smiles Co., Ltd. – Head of HR & Administration, Corporate Division Apr. 2014: Joined Sibon Co., Ltd. Jul. 2015: Joined Terada Warehouse, Inc. Apr. 2016: Executive Officer, Head of HR Development Aug. 2017: Senior Executive Officer, Head of HR Development May 2018: Managing Executive Officer, Head of HR Development Nov. 2018: President and Representative Director (CEO) of HOP Inc. (current) Sep. 2020: Director (CHRO/CCO) of FarmShip Inc. May 2024: Outside Director (Audit and Supervisory Committee Member) of VarioSecure Inc. (current) Significant Concurrent Positions: HOP Inc. – President and Representative Director (CEO) Reason for nomination: Ms. Hata has extensive experience in human capital development, and is expected to provide appropriate advice on HR strategy, talent utilization, and organizational revitalization. |
| 2 | Kana Takahashi (Born: Mar. 12, 1984) [Outside/Independent] | Sep. 2007: Admitted to the Bar (Japan) Sep. 2007: Joined Mori Hamada & Matsumoto Aug. 2016: Joined Chugai Pharmaceutical Co., Ltd. Nov. 2018: Joined Hifumi General Law Office (current) Apr. 2022: Outside Audit & Supervisory Board Member, White Essence Inc. Oct. 2022: Outside Audit & Supervisory Board Member, matsuri technologies Inc. (current) May 2024: Outside Director (Audit and Supervisory Committee Member) of VarioSecure Inc. (current) Nov. 2024: Supervisory Officer, Canadian Solar Infrastructure Fund (current) Mar. 2025: Director (Audit and Supervisory Committee Member), Renatasu Inc. (current) Apr. 2025: Supervisory Officer, Kasumigaseki Hotel REIT Investment Corp. (current) Significant Concurrent Positions: Hifumi General Law Office – Attorney at Law matsuri technologies Inc. – Outside Audit & Supervisory Board Member Canadian Solar Infrastructure Fund – Supervisory Officer Renatasu Inc. – Director (Audit and Supervisory Committee Member) Kasumigaseki Hotel REIT Investment Corp. – Supervisory Officer Reason for nomination: Although Ms. Takahashi has not been directly involved in corporate management, her advanced legal expertise as an attorney is valuable for overseeing management from a legal perspective to strengthen corporate governance. |
| 3 | Motoi Moriwaki (Born: Mar. 25, 1979) [Outside/Independent] | Apr. 2002: Joined Baseball Magazine Corp. (now BBM Sports Commission Inc.) Jan. 2008: Joined Sogo Rinsho Holdings Inc. (now EPLink Inc.) Jul. 2009: Joined Apload Inc. Apr. 2011: Joined en Japan Inc. Jan. 2023: Head of CFO Office, BuySell Technologies Co., Ltd. May 2024: Outside Director (Audit and Supervisory Committee Member) of VarioSecure Inc. (current) Apr. 2026: Head of IR Dept., Finance & IR Strategy Division, BuySell Technologies Co., Ltd. (current) Reason for nomination: Although Mr. Moriwaki has not been directly involved in corporate management, his deep expertise in IR and finance enables him to oversee and advise on management from a fair and neutral perspective. |

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(Notes)

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

1. There are no material conflicts of interest between any nominee and the Company.

2. Ms. Hata, Ms. Takahashi, and Mr. Moriwaki are nominated as outside director candidates for the Audit and Supervisory Committee.

3. Each nominee's current term expires at the conclusion of this Annual Meeting, having served two (2) years as outside directors serving as Audit and Supervisory Committee members.

4–6. Reasons for nomination are included in the table above.

7. Ms. Hata, Ms. Takahashi, and Mr. Moriwaki are designated as independent officers as required by the TSE and are expected to continue to be so designated if elected.

8. Liability limitation agreements with Ms. Hata, Ms. Takahashi, and Mr. Moriwaki will continue if their reappointment is approved. The maximum liability under such agreements is the amount prescribed by applicable law.

9. The D&O liability insurance policy will cover all nominees if elected. The policy is expected to be renewed on substantially the same terms.

**(Reference) Post-Meeting Board Skills Matrix (Expected)** 

If all nominees are elected as proposed, the Board's skills matrix will be as follows:

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Name** | **Corporate<br>Mgmt.** | **Corp.<br>Governance** | **IT/Digital** | **Technology/<br>R&D** | **Sales/<br>Marketing** | **Finance/<br>Accounting** | **HR/Talent<br>Dev.** | **International** |
| Tomohiro Takahashi | • |  | • |  | • |  |  |  |
| Takahiro Hayashi | • | • | • |  |  |  | • |  |
| Keiichi Iguchi | • |  | • | • |  |  |  |  |
| Hiroya Mori | • | • |  |  |  | • |  |  |
| Keiko Hata (Outside) | • | • |  |  |  |  | • |  |
| Kana Takahashi (Outside) | • | • |  |  |  |  |  | • |
| Motoi Moriwaki (Outside) | • |  |  |  | • | • |  |  |

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**END** 

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VarioSecure Inc. \| Notice of the 11th Annual Meeting of Shareholders

**Venue Access Map** 

Venue: CONFERENCE, 3F Kanda Square, 2-1 Kanda Nishikicho, Chiyoda-ku, Tokyo

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| | | |
|:---|:---|:---|
| **Transport** | **Station / Line** | **Exit / Walking Time** |
| Tokyo Metro | Chiyoda Line "Shin-Ochanomizu" Station | Exit B7 – approx. 3 min. |
|  | Marunouchi Line "Awajicho" Station | Exit B7 – approx. 3 min. |
| Toei Subway | Shinjuku Line "Ogawamachi" Station | Exit B7 – approx. 3 min. |
| Tokyo Metro | Hanzomon Line "Jimbocho" Station | Exit A9 – approx. 5 min. |
| Tokyo Metro | Tozai Line "Takebashi" Station | Exit 3b – approx. 6 min. |
| Tokyo Metro | Chiyoda Line "Otemachi" Station | Exit C2b – approx. 8 min. |
| JR | Chuo/Sobu Lines "Ochanomizu" Station | Hijiri Bridge Exit – approx. 9 min. |
| JR | Multiple Lines, "Kanda" Station | Exit 4 / North Exit – approx. 10 min. |

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## Exhibit 99.3

**Exhibit 99.3** 

HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

This document relates to a proposed share exchange, which is a business combination involving the securities of a foreign company. The transaction is subject to disclosure requirements of a foreign country that are different from those of the United States. Financial statements included in this document, if any, have been prepared in accordance with foreign accounting standards that may not be comparable to the financial statements of United States companies.

It may be difficult for you to enforce your rights and any claim you may have arising under the federal securities laws, since the issuer is located in a foreign country, and some or all of its officers and directors may be residents of a foreign country. You may not be able to sue a foreign company or its officers or directors in a foreign court for violations of the U.S. securities laws. It may be difficult to compel a foreign company and its affiliates to subject themselves to a U.S. court's judgment.

You should be aware that the issuer may purchase securities otherwise than pursuant to the share exchange, such as in open market or privately negotiated purchases.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**VarioSecure Inc.** 

**Electronically Provided Materials** 

**for the 11th Annual General Meeting of Shareholders** 

Fiscal Year Ended February 28, 2026

(March 1, 2025 – February 28, 2026)

Notice: Pursuant to applicable law and Article 15 of the Company's Articles of Incorporation, the following matters, which are required to be provided electronically, have been omitted from the Summary of Electronically Provided Matters (the written document delivered to shareholders who have requested paper copies):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) "Overview of the Framework for Ensuring Proper Business Operations and Its Operational Status" in the Business Report of VarioSecure Inc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) "Fundamental Policy on Control of the Company" in the Business Report of VarioSecure Inc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) "Notes to Standalone Financial Statements" in the Standalone Financial Statements of VarioSecure Inc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) "Articles of Incorporation" of HEROZ, Inc. and "Contents of the Financial Statements for the Most Recent Fiscal Year (Fiscal Year Ended April 2025)" of HEROZ, Inc., as included in the Reference Documents for the General Meeting of Shareholders.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**VarioSecure Inc. — Electronically Provided Matters** 

**(i) Overview of the Framework for Ensuring Proper Business Operations and Its Operational Status** 

**1. Summary of Policies Adopted for the Framework for Ensuring Proper Business Operations** 

The following summarizes the resolutions adopted by the Board of Directors to ensure that directors' execution of duties complies with applicable laws and the Articles of Incorporation, and to otherwise ensure proper business operations:

**(1) System to Ensure That Directors and Employees Comply with Laws and the Articles of Incorporation** 

The Company shall comply with internal rules and policies, including the Compliance Policy and Code of Conduct, and the Risk Management Committee shall oversee and supervise all compliance initiatives.

**(2) System for Retention and Management of Information Related to Directors' Execution of Duties** 

Information related to Board resolutions and other material approvals shall be recorded and retained in accordance with applicable laws and the Document Management Policy. Directors and Directors serving as Audit and Supervisory Committee Members shall have unrestricted access to such information at all times.

**(3) Rules and Systems for Risk Management** 

Recognizing that risk management is a critical management priority, the Company shall operate its risk management framework under the Risk Management Committee in accordance with the Risk Management Policy.

**(4) System to Ensure Efficient Execution of Directors' Duties** 

(a) Directors' duties shall be executed efficiently in accordance with the Board of Directors Rules and the Authority and Responsibility Rules.

(b) Management reports shall be presented at weekly management meetings to streamline Board deliberations.

**(5) System to Ensure Proper Operations Across the Corporate Group (Including Parent and Subsidiaries)** 

In the event that subsidiaries are established, the Company shall adopt Related Companies Management Rules and implement measures to ensure proper operations across the corporate group.

**(6) Personnel to Assist Audit and Supervisory Committee Members** 

If Audit and Supervisory Committee Members request the appointment of support staff for their duties, the Company shall designate such personnel as assistants as necessary.

**(7) Independence of Support Staff and Effectiveness of Audit and Supervisory Committee Members' Instructions** 

(a) Audit and Supervisory Committee Members may direct support staff to assist with audit activities.

(b) Such support staff shall perform ancillary tasks necessary for the audit activities directed by Audit and Supervisory Committee Members and shall have authority to collect necessary information.

**(8) System for Reporting to Audit and Supervisory Committee Members** 

(a) Audit and Supervisory Committee Members may attend significant internal meetings.

(b) Directors and employees shall provide timely and appropriate reports and information to Audit and Supervisory Committee Members or the Audit and Supervisory Committee upon request, in addition to matters required by law and internal rules.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(9) Protection Against Retaliation for Reports** 

No person who makes a report to an Audit and Supervisory Committee Member shall be subjected to adverse treatment as a result of such report.

**(10) Policies on Costs and Obligations Arising from Audit and Supervisory Committee Members' Duties** 

(a) The Company shall establish and operate an internal control framework over financial reporting to ensure reliable financial statements.

(b) The Company shall promptly process requests from Audit and Supervisory Committee Members for advance payment or reimbursement of expenses incurred in the performance of their duties.

**(11) Other Measures to Ensure Effective Audits by Audit and Supervisory Committee Members** 

The Company's directors shall maintain systems enabling adequate information sharing between Audit and Supervisory Committee Members and the Company's independent auditor regarding accounting audit matters.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**2. Summary of the Operating Status of the Internal Control System** 

The following is a summary of the operational status of the framework for ensuring proper business operations:

**(1) Measures to Ensure Efficient Execution of Directors' Duties** 

The Board of Directors consists of seven (7) directors, including three (3) outside directors. The Board holds regular monthly meetings and convenes special meetings as needed for prompt, effective, and efficient decision-making. The Board serves as the principal governing body for deliberating and resolving significant management matters and monitoring business execution.

All Audit and Supervisory Committee Members attend every Board meeting, providing a framework for ongoing oversight of directors' performance.

**(2) Measures to Ensure Effective Internal Audits** 

The Company has established an Internal Audit Office reporting directly to the Representative Director and President, staffed by four (4) members including one (1) full-time head of internal audit and three (3) concurrent staff. Internal audit personnel conduct audits in accordance with the internal audit plan, covering compliance with laws, the Articles of Incorporation, and internal rules, as well as the status of business operations. Audit findings are reported to the Representative Director and President, and remediation is monitored on an ongoing basis.

**(3) Measures to Ensure Effective Audits by Audit and Supervisory Committee Members** 

As a company with an Audit and Supervisory Committee, the Company has three (3) outside directors serving as Audit and Supervisory Committee Members who audit directors' execution of duties. Each member conducts audits based on the audit plan, and the Audit and Supervisory Committee meets monthly to share information.

In addition, Audit and Supervisory Committee Members attend the General Meeting of Shareholders, Board meetings, and other significant internal meetings, where they actively express their views. They also engage in regular information exchanges with the Representative Director, solicit reports from individual directors on business operations as appropriate, and coordinate with the Internal Audit Office and the independent auditor to conduct effective and efficient audits.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(ii) Fundamental Policy on Control of the Company** 

Not applicable.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(iii) Notes to Standalone Financial Statements — VarioSecure Inc.** 

**Note 1. Significant Accounting Policies** 

**(1) Valuation of Inventories** 

Merchandise: Cost method based on the moving-average method (carrying amounts written down to reflect decline in profitability)

Supplies: Cost method based on the moving-average method (carrying amounts written down to reflect decline in profitability)

**(2) Depreciation of Non-Current Assets** 

**(a) Property, Plant and Equipment (excluding leased assets)** 

The declining-balance method is applied. However, the straight-line method is applied to building improvements acquired on or after April 1, 2016.

The principal useful lives are as follows:

Building improvements: 8 to 18 years <br> Tools, furniture and fixtures: 3 to 15 years

**(b) Intangible Assets (excluding leased assets)** 

• Internal-use software: Straight-line method over the expected useful life
within the Company.

• Goodwill: Amortized on a straight-line basis over the estimated period during which the investment benefits are
expected to be realized.

**(3) Basis for Recording Provisions** 

(a) Allowance for Doubtful Accounts: To provide for losses from uncollectible receivables, the allowance for general receivables is recorded based on the historical loss rate; for specific doubtful receivables, the estimated uncollectible amounts are recorded based on individual assessments of collectibility.

(b) Provision for Bonuses: To provide for bonus payments to employees, the estimated amount attributable to the current fiscal year of the anticipated bonus payments in the following fiscal year is recorded.

**(4) Revenue and Cost Recognition** 

The following describes the principal performance obligations in the Company's primary business lines arising from contracts with customers and the typical timing at which such obligations are satisfied (i.e., the typical point of revenue recognition):

(a) Security BPO Services

Security BPO Services consist of the provision of managed security services. Because managed security services are satisfied over time based on the passage of time during the contract period, revenue is recognized over that period. As the performance obligation is satisfied by providing services to customers over the period stipulated in the contract, revenue is recognized, in principle, on a straight-line basis over the contract period.

(b) Integration Services

For product sales, revenue is recognized upon delivery to the customer and acceptance by the customer, as the customer is able to use or sell the product at will from that point and is entitled to the related benefits, representing the transfer of control. For licensed software, the Company has an obligation to provide services over the license period; the related performance obligation is satisfied over the license period and revenue is recognized over that period. As the performance obligation is satisfied by providing services to customers over the period stipulated in the contract, revenue is recognized, in principle, on a straight-line basis over the contract period.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Note 2. Changes in Accounting Policies** 

Not applicable.

**Note 3. Changes in Presentation** 

Not applicable.

**Note 4. Critical Accounting Estimates** 

**Evaluation of Goodwill** 

**(1) Amount Recorded in the Financial Statements for the Current Fiscal Year** 

---

| | |
|:---|:---|
|  **Goodwill** | JPY 2,710,771 thousand |

---

Although no impairment loss on goodwill was recognized in the current fiscal year, this item has been identified as a disclosure item in view of the risk of a material impact on the financial statements of the following fiscal year.

**(2) Information on Significant Accounting Estimates Relating to the Identified Item** 

(a) Calculation Method

The goodwill recognized by the Company arose primarily from the business combination carried out by BAF5 Co., Ltd. with the former VarioSecure Inc. and was succeeded to the post-merger company upon their merger.

The Company operates as a single segment in the internet security services business. As the synergies arising from the acquisition accrue to the overall cash-generating unit representing that single segment, goodwill has been allocated to that overall cash-generating unit.

With respect to goodwill arising from the business combination, the Company identifies indications of impairment by monitoring whether the excess earning power expected at the time of acquisition will materialize in the future. If an indication of impairment is identified, the carrying amount is compared to the total of undiscounted future cash flows, and if an impairment loss is to be recognized, the recoverable amount is measured based on the discounted present value of future cash flows. No impairment loss was recognized in the current fiscal year, as the total undiscounted future cash flows exceeded the carrying amount.

(b) Key Assumptions

Future cash flows are based on the business plan prepared using revenue forecasts and investment plans through the fiscal year ending February 2029, along with other publicly available information. For periods beyond the business plan period, future cash flows are calculated based on the cash flows of the final fiscal year of the plan. The key assumption used in estimating future cash flows is the revenue growth rate.

(c) Impact on the Following Year's Financial Statements

Although the estimates of future cash flows represent the best estimates available at this time, the key assumption of the revenue growth rate is subject to uncertainty from changes in the business environment. If the estimated future cash flows decrease due to changes in such assumptions, there may be a material impact on the financial statements of the following fiscal year.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Note 5. Balance Sheet** 

(1) Accumulated depreciation of property, plant and equipment JPY 463,235 thousand

**(2) Monetary Claims and Obligations to Related Companies** 

Short-term monetary claims — <br> Short-term monetary obligations JPY 989 thousand

**(3) Revolving Credit Facilities** 

The Company has entered into overdraft facility agreements with three (3) financial institutions to efficiently procure operating funds. The undrawn balance under these agreements at the fiscal year-end is as follows:

---

| | |
|:---|:---|
|  Total overdraft facility limit | JPY 900,000 thousand |
|  Outstanding borrowings |  |
|  Undrawn balance | JPY 900,000 thousand |

---

**Note 6. Income Statement** 

**Transactions with Related Companies** 

---

| | |
|:---|:---|
|  **Business transactions** |  |
|  Net sales |  |
|  Cost of sales | JPY 1,942 thousand |
|  Selling, general and administrative expenses | JPY 6,659 thousand |

---

**Note 7. Statement of Changes in Shareholders' Equity** 

**(1) Type and Total Number of Shares Issued and Outstanding at the End of the Fiscal Year** 

Common shares 4,522,961 shares

**(2) Type and Number of Treasury Shares at the End of the Fiscal Year** 

Common shares 4,427 shares

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(3) Matters Relating to Dividends** 

(a) Dividend Payments: Not applicable.

(b) Dividends with a record date in the current fiscal year and an effective date in the following fiscal year: Not applicable.

**(4) Type and Number of Shares Underlying Stock Acquisition Rights Outstanding at Fiscal Year-End (Excluding Those for Which the Exercise Period Has Not Yet Commenced)** 

Common shares 53,680 shares

**Note 8. Financial Instruments** 

**(1) Matters Relating to the Status of Financial Instruments** 

(a) Policy on Financial Instruments

The Company limits its investment of temporary surplus funds to short-term deposits and similar instruments. The Company procures funds through borrowings from multiple financial institutions and the use of overdraft facility commitments. The Company does not engage in derivative transactions.

(b) Content of Financial Instruments and Associated Risks

Trade receivables (accounts receivable) are exposed to customer credit risk — the risk that customers may default on their contractual obligations and cause financial losses to the Company. Long-term borrowings are exposed to liquidity risk associated with fund procurement and the risk of fluctuations in interest rates.

(c) Risk Management Framework for Financial Instruments

i. Management of Credit Risk (risk of counterparty default on contracts)

The Company manages credit risk relating to accounts receivable in accordance with its Credit Management Policy.

ii. Management of Liquidity Risk Associated with Fund Procurement (risk of being unable to make payments on due dates)

The Administration Division prepares and updates cash flow plans in a timely manner based on reports from each department, and manages liquidity risk through the maintenance of adequate on-hand liquidity.

iii. Management of Interest Rate Risk

To mitigate interest rate risk, the Administration Division monitors market trends and conditions.

(d) Supplementary Explanation on the Fair Value of Financial Instruments

The fair values of financial instruments include values based on market prices as well as reasonably calculated values where market prices are not available. Since variable factors are incorporated in the calculation of such values, changes in the underlying assumptions may cause the values to fluctuate.

**(2) Fair Value of Financial Instruments** 

The following table presents the carrying amounts, fair values and differences between them for financial instruments as of February 28, 2026. With respect to cash and deposits and accounts receivable, since deposits and accounts receivable are settled in short periods, their fair values approximate their carrying amounts and are therefore omitted.

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---

| | | | | |
|:---|:---|:---|:---|:---|
|  |  | **Carrying<br>Amount** | **Fair Value** | **Difference** |
| (1) | Long-term borrowings due within one year | JPY 200,000K | JPY 200,000K |  |
| (2) | Long-term borrowings | JPY 700,000K | JPY 700,000K |  |

---

(Note) Long-term borrowings due within one year and long-term borrowings: As these are procured at variable rates
subject to periodic rate resets, their fair values approximate their carrying amounts.

**(3) Breakdown by Fair Value Level** 

The Company classifies the fair values of financial instruments into the following three levels based on the observability and significance of the inputs used:

Level 1: Fair values determined using quoted prices in active markets for identical assets or liabilities.

Level 2: Fair values determined using observable inputs other than Level 1 inputs.

Level 3: Fair values determined using unobservable inputs.

When multiple inputs belonging to different levels are used, the fair value is classified to the lowest-priority level among those applicable.

Financial instruments not measured at fair value on the balance sheet:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Level 1** | **Level 2** | **Level 3** | **Total** |
|  Long-term borrowings (incl. current portion) | – | 900000 | – | 900000 |

---

(Note) Long-term borrowings: As these are procured at variable rates that reflect market interest rates over short
periods, fair values approximate carrying amounts and are classified as Level 2.

**Note 9. Revenue Recognition** 

**1. Net Sales to External Customers by Service Category** 

---

| | | |
|:---|:---|:---|
| **Net sales** | **(JPY thousands)** | **(JPY thousands)** |
|  Security BPO Services |  | 2490555 |
|  Integration Services |  | 352099 |
|  **Revenue from contracts with customers** |  | **2,842,655** |
|  Other revenue |  |  |
|  **Net sales to external customers** |  | **2,842,655** |

---

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**2. Basis for Understanding Revenue** 

See the revenue and cost recognition policy described in Note 1, Significant Accounting Policies.

**3. Information for Understanding Revenue in the Current and Future Fiscal Years** 

Contract Assets and Contract Liabilities:

---

| | |
|:---|:---|
|  | **Current Fiscal Year** |
|  Receivables from contracts (opening balance) | ¥452,063 thousand |
|  Receivables from contracts (closing balance) | ¥528,946 thousand |
|  Contract assets (opening balance) |  |
|  Contract assets (closing balance) |  |
|  Contract liabilities (opening balance) | ¥190,392 thousand |
|  Contract liabilities (closing balance) | ¥86,207 thousand |

---

**Note 10. Income Tax Effects** 

**Breakdown of Deferred Tax Assets and Liabilities by Principal Source** 

---

| | |
|:---|:---|
| **Deferred Tax Assets** | **(JPY thousands)** |
|  Corporate inhabitant tax payable | ¥7,380 thousand |
|  Provision for bonuses | ¥306 thousand |
|  Revenue recognition timing difference (net sales) | ¥21,423 thousand |
|  Asset retirement obligation | ¥5,855 thousand |
|  Deferred revenue | ¥2,967 thousand |
|  Inventory write-down | ¥58,706 thousand |
|  Other | ¥1,601 thousand |
|  **Total deferred tax assets** | ¥**98,241 thousand** |
|  **Deferred Tax Liabilities** |  |
|  Revenue recognition timing difference (cost of sales) | 13,384 thousand) |
|  Building improvements (asset retirement obligation) | 2,715 thousand) |
|  **Total deferred tax liabilities** | 16,100 thousand) |
|  **Net deferred tax assets** | ¥**82,141 thousand** |

---

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Note 11. Related Party Transactions** 

**Directors and Individual Major Shareholders** 

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Category** | **Name** | **Voting**<br> **Rights Held /**<br> **(Held by)** | **Relationship** | **Nature of**<br> **Transaction** | **Amount<br>(JPY<br>K)** | **Account** | **Closing<br>Balance<br>(JPY<br>K)** |
|  Director | Satoshi Yamamori | Held (direct): 0.01% | Director of the Company | Settlement payment | 12500 | – |  |

---

(Note) The settlement payment was determined based on the amount of the fixed monthly director's remuneration.

Mr. Satoshi Yamamori resigned as director of the Company on November 18, 2025.

**Note 12. Per-Share Information** 

(1) Net assets per share JPY 868.19 <br> (2) Earnings per share (net income) JPY 23.41

**Note 13. Subsequent Events** 

At its Board of Directors meeting held on April 14, 2026, the Company resolved to enter into a Share Exchange (the "Share Exchange") pursuant to which HEROZ, Inc. ("HEROZ") would become the sole parent company of the Company and the Company would become a wholly-owned subsidiary of HEROZ. A Share Exchange Agreement was executed on the same date.

As a result of the Share Exchange, HEROZ will become the sole parent company of the Company, and the Company's shares are scheduled to be delisted from the stock exchange on June 26, 2026.

**Note 14. Other Notes** 

Not applicable.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(iv) HEROZ, Inc. — Articles of Incorporation** 

(As amended July 27, 2023)

**Chapter 1. General Provisions** 

**Article 1. (Trade Name)** 

The trade name of the Company shall be "HEROZ Kabushiki Kaisha", expressed in English as "HEROZ, Inc."

**Article 2. (Purposes)** 

The Company's purposes shall be to engage in the following businesses:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Services relating to the collection, processing and provision of various types of information

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Sales activities for various goods and services, and support thereof

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Analysis and design of computer systems and consulting relating to the Internet

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Planning, development, design, manufacturing, sales, leasing and import/export of computers, peripheral/related equipment and software therefor

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Mail-order business

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. Planning and production of advertising and publicity, and advertising agency business

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. Marketing-related business and consulting

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. Telecommunications business pursuant to the Telecommunications Business Act

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. Investment advisory and agency business

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. Worker dispatch business

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. Paid employment placement business

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. Investment, trading, holding and management of financial assets

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. Any and all businesses incidental to any of the foregoing

**Article 3. (Location of Head Office)** 

The Company shall have its head office in Minato-ku, Tokyo.

**Article 4. (Corporate Organs)** 

The Company shall have the following corporate organs:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Board of Directors

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Audit and Supervisory Committee

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Accounting Auditor

**Article 5. (Method of Public Notice)** 

Public notices of the Company shall be made by electronic means. However, if electronic public notice cannot be made due to an accident or other unavoidable circumstances, public notices shall be made by publication in the Nihon Keizai Shimbun (Nikkei).

**Chapter 2. Shares** 

**Article 6. (Authorized Share Capital)** 

The total number of shares authorized to be issued by the Company shall be 52,600,000 shares.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Article 7. (Acquisition of Treasury Shares)** 

The Company may acquire its own shares by resolution of the Board of Directors pursuant to Article 165, Paragraph 2 of the Companies Act.

**Article 8. (Unit Share Number)** 

The number of shares constituting one (1) unit of shares of the Company shall be one hundred (100) shares.

**Article 9. (Rights of Holders of Shares Constituting Less than One Unit)** 

Shareholders holding shares constituting less than one unit may not exercise any rights with respect to such shares other than the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Rights set forth in each item of Article 189, Paragraph 2 of the Companies Act;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The right to make a demand pursuant to Article 166, Paragraph 1 of the Companies Act; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The right to receive an allotment of offered shares and offered stock acquisition rights in proportion to the number of shares held.

**Article 10. (Share Registrar)** 

The Company shall appoint a share registrar. The share registrar and the location of its business office shall be determined by resolution of the Board of Directors.

Preparation and keeping of the shareholders register and register of stock acquisition rights, and all other work relating to the shareholders register and register of stock acquisition rights, shall be delegated to the share registrar, and the Company shall not handle such work directly.

**Article 11. (Share Handling Regulations)** 

Procedures for the exercise of shareholder rights, and all other matters relating to shares and associated fees not otherwise provided for by law or these Articles, shall be governed by the Share Handling Regulations adopted by the Board of Directors.

**Chapter 3. General Meeting of Shareholders** 

**Article 12. (Convocation of the General Meeting of Shareholders)** 

The Annual General Meeting of Shareholders shall be convened within three (3) months after the end of each fiscal year. Extraordinary General Meetings of Shareholders shall be convened as needed.

A General Meeting of Shareholders may be held without specifying a physical venue.

**Article 13. (Record Date)** 

The record date for the exercise of voting rights at the Annual General Meeting of Shareholders of the Company shall be April 30 of each year.

**Article 14. (Person to Convene and Chair)** 

Except as otherwise provided by law, the General Meeting of Shareholders shall be convened by the CEO and chaired by the CEO. If there are multiple CEOs, the order predetermined by the Board of Directors shall apply, and the Co-CEO shall convene and chair the meeting.

If the CEO or Co-CEO described in the preceding paragraph is unable to act, another director shall convene and chair the meeting in an order predetermined by the Board of Directors.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Article 15. (Resolutions at the General Meeting of Shareholders)** 

Except as otherwise provided by law or by these Articles of Incorporation, resolutions at the General Meeting of Shareholders shall be adopted by a majority of the voting rights held by shareholders present who are entitled to exercise voting rights.

Resolutions pursuant to Article 309, Paragraph 2 of the Companies Act shall be adopted by shareholders holding at least one-third (1/3) of the total voting rights of shareholders entitled to exercise voting rights being present, and by a two-thirds (2/3) majority of such voting rights.

**Article 16. (Exercise of Voting Rights by Proxy)** 

A shareholder may exercise voting rights through one (1) other shareholder of the Company who holds voting rights.

A shareholder or the shareholder's proxy must submit to the Company a document evidencing the proxy authorization at each General Meeting of Shareholders.

**Article 17. (Minutes)** 

The substance of proceedings and results of the General Meeting of Shareholders, and other matters required by law, shall be recorded or entered in the minutes.

**Article 18. (Electronic Provision Measures)** 

When convening the General Meeting of Shareholders, the Company shall take electronic provision measures with respect to information that constitutes the content of the Reference Documents for the General Meeting of Shareholders and other documents.

The Company may, with respect to all or part of the matters for which electronic provision measures are taken and which are prescribed by the Ordinance of the Ministry of Justice, omit their inclusion in the written document delivered to shareholders who have submitted a written delivery request by the record date for voting rights.

**Chapter 4. Directors and Board of Directors** 

**Article 19. (Number of Directors)** 

The number of Directors of the Company (excluding Directors who are Audit and Supervisory Committee Members) shall be no more than six (6).

The number of Directors of the Company who are Audit and Supervisory Committee Members shall be no more than five (5).

**Article 20. (Election of Directors)** 

Directors shall be elected by resolution of the General Meeting of Shareholders, with Directors who are Audit and Supervisory Committee Members and other Directors being elected separately.

A resolution to elect Directors shall be adopted by shareholders holding at least one-third (1/3) of the total voting rights of shareholders entitled to exercise voting rights being present, and by a majority of such voting rights.

Cumulative voting shall not be used in the election of Directors.

**Article 21. (Term of Office of Directors)** 

The term of office of Directors (excluding Directors who are Audit and Supervisory Committee Members) shall expire at the conclusion of the Annual General Meeting of Shareholders held for the last fiscal year ending within one (1) year of their election.

The term of office of Directors who are Audit and Supervisory Committee Members shall expire at the conclusion of the Annual General Meeting of Shareholders held for the last fiscal year ending within two (2) years of their election.

The term of office of a Director who is an Audit and Supervisory Committee Member elected as a replacement for a Director who resigned before the expiration of his or her term shall expire at the time the term of the Director so replaced would have expired.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Article 22. (Representative Directors)** 

The Representative Director shall represent the Company and oversee the Company's operations.

The Company shall select the Representative Director(s) from among the Directors (excluding Directors who are Audit and Supervisory Committee Members) by resolution of the Board of Directors.

**Article 23. (CEO)** 

The Company shall select, by resolution of the Board of Directors, one (1) or more CEO(s) (Chief Executive Officer(s)) from among the Representative Directors. If there are multiple CEOs, each shall be referred to as a "Co-CEO."

**Article 24. (Person to Convene and Chair Board Meetings)** 

Except as otherwise provided by law, the Board of Directors shall be convened by the CEO and chaired by the CEO. If there are multiple CEOs, the order predetermined by the Board of Directors shall apply, and the Co-CEO shall convene and chair the meeting.

If the CEO or Co-CEO described in the preceding paragraph is unable to act, another Director shall convene and chair the meeting in an order predetermined by the Board of Directors.

**Article 25. (Notice of Convocation of Board Meetings)** 

Notice of a Board of Directors meeting shall be dispatched to each Director at least three (3) days prior to the meeting date; provided, however, that in urgent circumstances such notice period may be shortened.

A Board of Directors meeting may be held without going through the convocation procedures when all Directors consent thereto.

**Article 26. (Method of Resolution at Board Meetings)** 

Resolutions at Board of Directors meetings shall be adopted by a majority of Directors who are entitled to participate in the resolution being present, and by a majority of such Directors.

Notwithstanding the preceding paragraph, where a Director has submitted a proposal regarding a matter subject to resolution at a Board of Directors meeting, and all Directors entitled to participate in the resolution express their consent in writing or by electromagnetic record, such proposal shall be deemed adopted by the Board of Directors without holding an actual meeting.

**Article 27. (Delegation of Authority to Decide on Important Operational Matters)** 

The Company may, by resolution of the Board of Directors, delegate to Directors, in whole or in part, the authority to decide on important operational matters (excluding matters listed in each item of Article 399-13, Paragraph 5 of the Companies Act), pursuant to Article 399-13, Paragraph 6 of the Companies Act.

**Article 28. (Minutes of Board Meetings)** 

The substance of proceedings and results of Board of Directors meetings, and other matters required by law, shall be recorded or entered in the minutes, and each attending Director shall affix a name seal or electronic signature thereto.

**Article 29. (Board of Directors Regulations)** 

Matters relating to the Board of Directors shall be governed, in addition to applicable laws and these Articles of Incorporation, by the Board of Directors Regulations established by the Board of Directors.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Article 30. (Remuneration of Directors)** 

Remuneration, bonuses and other financial benefits received from the Company by Directors in consideration for the performance of their duties (collectively "Remuneration, Etc.") shall be determined by resolution of the General Meeting of Shareholders, with Directors who are Audit and Supervisory Committee Members and other Directors being determined separately.

**Article 31. (Exculpation of Directors)** 

Pursuant to Article 426, Paragraph 1 of the Companies Act, the Company may, by resolution of the Board of Directors, exempt Directors (including former Directors) from their liability for damages arising from a breach of duty, to the extent permitted by law.

Pursuant to Article 427, Paragraph 1 of the Companies Act, the Company may enter into agreements with Directors (excluding executive directors, etc.) to limit their liability for damages arising from a breach of duty; provided, however, that the maximum amount of liability under such agreements shall be the amount prescribed by law.

**Chapter 5. Audit and Supervisory Committee** 

**Article 32. (Standing Audit and Supervisory Committee Members)** 

The Audit and Supervisory Committee may select, by resolution, a standing Audit and Supervisory Committee Member from among its members.

**Article 33. (Notice of Convocation of Audit and Supervisory Committee Meetings)** 

Notice of an Audit and Supervisory Committee meeting shall be sent to each Committee Member at least three (3) days prior to the meeting date; provided, however, that this period may be shortened in urgent circumstances.

A meeting may be held without the convocation procedures if all Committee Members consent thereto.

**Article 34. (Method of Resolution at Audit and Supervisory Committee Meetings)** 

Resolutions at Audit and Supervisory Committee meetings shall be adopted by a majority of Audit and Supervisory Committee Members who are entitled to participate in the resolution being present, and by a majority of such members.

**Article 35. (Minutes of Audit and Supervisory Committee Meetings)** 

A summary of the proceedings and results of Committee meetings, together with other matters required by law, shall be recorded in the minutes, which shall be signed and sealed (or electronically signed) by the Committee Members present.

**Article 36. (Audit and Supervisory Committee Regulations)** 

Matters relating to the Audit and Supervisory Committee not otherwise provided for by law or these Articles shall be governed by the Audit and Supervisory Committee Rules adopted by the Committee.

**Chapter 6. Accounting Auditor** 

**Article 37. (Appointment of Accounting Auditor)** 

The Accounting Auditor shall be appointed by resolution of the General Meeting of Shareholders.

**Article 38. (Term of Office of the Accounting Auditor)** 

The term of office of the Accounting Auditor shall expire at the conclusion of the Annual General Meeting of Shareholders held for the last fiscal year ending within one (1) year of his, her or its appointment.

If no contrary resolution is adopted at the Annual General Meeting described in the preceding paragraph, the Accounting Auditor shall be deemed to have been reappointed at such meeting.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Article 39. (Remuneration of the Accounting Auditor)** 

The remuneration of the Accounting Auditor shall be determined by the Representative Director with the consent of the Audit and Supervisory Committee.

**Article 40. (Exculpation of the Accounting Auditor)** 

Pursuant to Article 426, Paragraph 1 of the Companies Act, the Company may, by resolution of the Board of Directors, exempt the Accounting Auditor (including former Accounting Auditors) from liability for damages arising from a breach of duty, to the extent permitted by law.

Pursuant to Article 427, Paragraph 1 of the Companies Act, the Company may enter into agreements with the Accounting Auditor to limit its liability for damages arising from a breach of duty; provided, however, that the maximum amount of liability under such agreements shall be the amount prescribed by law.

**Chapter 7. Accounting** 

**Article 41. (Fiscal Year)** 

The fiscal year of the Company shall commence on May 1 of each year and end on April 30 of the following year.

**Article 42. (Record Date for Year-End Dividends)** 

The record date for year-end dividends of the Company shall be April 30 of each year.

**Article 43. (Interim Dividends)** 

The Company may pay interim dividends by resolution of the Board of Directors, with October 31 of each year as the record date.

**Article 44. (Statute of Limitations on Dividends)** 

No interest shall accrue on year-end dividends or interim dividends. If any such dividends remain unclaimed after three (3) years from the date on which payment thereof commenced, the Company shall be released from the obligation to pay such dividends.

**Supplementary Provisions** 

**1. Transitional Provisions Relating to Exemption of Statutory Auditors from Liability** 

(a) The Company may, by resolution of the Board of Directors, exempt Corporate Auditors (including former Corporate Auditors) from liability under Article 423, Paragraph 1 of the Companies Act in respect of acts occurring prior to the close of the 9th Annual General Meeting of Shareholders, to the extent permitted by law.

(b) Agreements to limit the liability under Article 423, Paragraph 1 of the Companies Act of Outside Corporate Auditors (including former Outside Corporate Auditors) in respect of acts occurring prior to the close of the 9th Annual General Meeting of Shareholders shall remain governed by Article 42 of the Articles of Incorporation as in effect prior to the amendment at such meeting.

**2. Effective Date of Amendment to Article 12, Paragraph 2** 

The addition of Article 12, Paragraph 2 (Convocation of General Meeting of Shareholders) shall take effect on the date on which the Minister of Economy, Trade and Industry and the Minister of Justice confirm that the Company is eligible to hold a General Meeting of Shareholders without a specified place of meeting pursuant to the provisions of the Act on Special Measures for Industrial Competitiveness. The provisions of this Supplementary Provision shall be deleted on the same date.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**3. (Transitional Provisions Relating to the Change in the Electronic Provision System)** 

(a) The deletion of the current Article 18 (Internet Disclosure and Deemed Provision of Reference Documents for General Meetings of Shareholders, etc.) and the adoption of Article 18 (Electronic Provision and Related Matters) shall take effect on the effective date (the "Effective Date") of the relevant amendment provisions under the proviso of Article 1 of the Supplementary Provisions of the Act Partially Amending the Companies Act (Act No. 70 of 2019).

(b) Notwithstanding the preceding paragraph, the current Article 18 shall remain in effect with respect to any General Meeting of Shareholders with a meeting date within six (6) months of the Effective Date.

(c) This supplementary provision shall be deleted on the later of (i) the date that is six (6) months after the Effective Date, or (ii) the date that is three (3) months after the General Meeting date referred to in the preceding paragraph.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**HEROZ, Inc. — Business Report (Fiscal Year Ended April 30, 2025)** 

(May 1, 2024 – April 30, 2025)

**1. Overview of the Corporate Group** 

**(1) Business Overview** 

**(a) Business Operations and Results** 

During the fiscal year under review, the Japanese economy showed signs of gradual recovery aided by improvements in income and employment conditions and the effects of various government policies. However, the outlook remained uncertain due to risks to the domestic economy from global monetary tightening, sharp fluctuations in foreign exchange and equity markets, developments in the Middle East and Ukraine, and rising prices.

Meanwhile, the information services industry continued to see expanding investment in DX (Digital Transformation) driven by unprecedented technological innovation, an aging population, and a declining working-age population. In particular, the AI market experienced a continued acceleration of investment in AI Transformation ("AIX") across industries, triggered by OpenAI's release of ChatGPT, with competition in AI technology, demand expansion, and real-world deployment of AI—including LLMs (Large Language Models)—progressing at a rapid pace. The Group defines AIX as the fundamental transformation of society as a whole, including existing business processes and business models, through the pervasive integration of AI. As LLMs and other AI technologies become ubiquitous throughout society, the emerging paradigm is no longer about using AI as a piecemeal business tool, but about more fundamental value creation and human-AI co-creation. In addition, both domestically and internationally, there is growing momentum and attention toward "AI Agents"—AI that autonomously executes tasks and operations like an employee—and we have entered an era that demands new value delivery and business process transformation through the realization and enhancement of AI Agents.

Furthermore, the SaaS market is expected to see growing demand not only for adoption but also for "inter-SaaS connectivity driven by diversifying needs" and "heightened security requirements due to increasingly complex integrated management." In the security market as well, cybersecurity threats continue to increase year over year, with ransomware attacks causing damage to various companies and healthcare institutions both in Japan and abroad, and in some cases impacting public welfare and the broader economy.

Against this backdrop, the Group has adopted "AI BPaaS" as the vision for HEROZ 3.0, aiming not merely to be a SaaS tool provider but to fully leverage generative AI and AI Agents spanning multiple domains and fields, delivering value through Agentic Work—where AI autonomously executes and optimizes entire business workflows—to drive AIX across society. In the fiscal year under review, both the AIX Business and the AI Security Business were propelled by the various AI Agents offered by the Group, achieving further revenue growth over the prior fiscal year.

Additionally, in August 2024, VOIQ Inc., a Group company, acquired the sales support business of bizy Inc. Through this acquisition, VOIQ assumed the inside sales function for the Group as a whole and is advancing the use of the Group's AI-related technologies in the sales and contact center domains, promoting growth as an AI Agent and the AI BPaaS model. Following the acquisition, VOIQ promptly began serving as the inside sales function primarily for HEROZ and VarioSecure Inc., and has also extended its support to other Group companies through the use of HEROZ ASK and other tools. Orders from external customers outside the Group have also been increasing. We will continue to pursue synergy expansion with a strong sense of urgency.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

Segment performance for the consolidated fiscal year is as follows:

**(i) AIX Business** 

In the fiscal year under review, the Group's AIX Business generated stable revenue driven by collaborative campaigns, new service launches, and feature additions in the BtoC domain, as well as the addition of Group companies and organic growth in deal volume in the BtoB domain. VOIQ Inc., which was made a subsidiary during the fiscal year, is included in the AIX Business segment.

BtoC Domain: In addition to the overwhelming network externalities already established in the market, continued growth in public interest in shogi (Japanese chess) contributed to stable revenue across "Shogi Wars," "Kishin Analytics," and "Kishin Learning." During the fiscal year, we executed a collaboration with the manga series "Boku to Roboco," held the Kishin Tournament European Championship, and updated the Kishin AI engine. In February 2025, Shogi Wars reached a cumulative 1 billion games played, and to celebrate this milestone, we launched the new service "Sprint." Driven in part by the Sprint launch, Shogi Wars' MAU (Monthly Active Users) and game counts continue to grow. Going forward, we will continue to enhance user satisfaction and maximize the shogi-playing population through new service releases and feature updates.

BtoB Domain: Revenue expanded due to increased deal volume and inquiries driven by growing investment in and attention to LLMs and AI Agents, as well as the acquisition of large-scale projects. While the first half of the fiscal year saw some delays in revenue recognition due to timing lags in contract commencement, deals progressively commenced in the second half, with both revenue and active deal counts significantly exceeding the prior year on a half-over-half basis. In addition, recurring revenue from "HEROZ ASK," "AI Sakura-san," and similar products continued to increase, and "JOINT iPaaS for SaaS" offered by StrategIT Co., Ltd. also saw gradual revenue growth in the second half. Looking ahead to FY2026 (fiscal year ending April 2026) and beyond, the BtoB pipeline remains robust, and we will continue to target growth exceeding the prior year.

**(ii) AI Security Business** 

The AI Security Business encompasses internet security-related services provided by VarioSecure Inc., a Group company.

VarioSecure has defined the following objectives in its medium-term management plan to support cybersecurity for primarily small and medium-sized enterprises ("SMEs"): "expanding and strengthening the competitive position of managed services," "entering high-growth security market segments," and "building new sales channels distinct from existing distribution networks." To achieve these goals, the company has been investing in talent acquisition, service planning, business development capabilities, and software development.

During the fiscal year under review, VarioSecure launched "Vario Ultimate ZERO" in August 2024 as a Security BPaaS (BPO as a Service) targeting cyber-attack countermeasures for mid-sized and small enterprises, offering end-to-end security from deployment through 24/365 managed operations.

Under these circumstances, managed security service revenue remained stable, supported by steady stock-type accumulation and a low churn rate of 0.71% (Note). In particular, Vario Managed EDR, an endpoint security solution that detects indicators of cyber attacks, continued to achieve strong growth.

(Note) Churn rate (amount basis) = Annual churned revenue / (Monthly revenue at the beginning of each year x 12)

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

Regarding expenses, while the Group pursued disciplined cost control in corporate functions, selling costs and general and administrative expenses increased year-over-year due to higher personnel costs from accelerated hiring to support business and service expansion, as well as increases in telecommunications and various license costs driven by recent inflation and upfront investment in new products (HEROZ ASK, JOINT).

Additionally, as announced on May 29, 2025 in the "Notice Regarding Recording of Extraordinary Loss and Revision of Full-Year Earnings Forecast," the Company recorded an impairment loss of ¥96,987 thousand as an extraordinary loss. Furthermore, primarily due to the newly recorded deferred tax assets at Group companies, the consolidated income tax adjustment (negative figures represent benefits) decreased to negative ¥16,359 thousand.

As a result, for the fiscal year under review:

Net sales: ¥5,929,797 thousand (up 22.5% year-over-year)

EBITDA (Note): ¥793,932 thousand (down 11.9% year-over-year)

Operating income: ¥306,429 thousand (down 32.1% year-over-year)

Ordinary income: ¥228,233 thousand (down 38.1% year-over-year)

Net loss attributable to owners of the parent: ¥177,709 thousand (compared to a loss of ¥1,134,535 thousand in the prior year)

(Note) EBITDA = Operating income + Depreciation + Amortization of security deposits + Amortization of goodwill (excluding amounts recorded as extraordinary losses) + Share-based compensation expense + Inventory valuation loss

**Segment Results** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | | | (JPY thousands) | (JPY thousands) |
|  |<br>Reportable<br>Segments | | | Adjustments<br>(Note 1) | Consolidated |
|  | AIX<br>Business |<br>AI Security<br>Business |<br>Subtotal | | |
|  **Net Sales** |  |  |  |  |  |
|  External customers | 3262257 | 2667539 | 5929797 |  | 5929797 |
|  Intersegment | 9562 |  | 9562 | (9562) |  |
|  Total | 3271820 | 2667539 | 5939359 | (9562) | 5929797 |
|  **Segment profit** | 775896 | 789335 | 1565231 | (1258802) | 306429 |
|  **Other items** |  |  |  |  |  |
|  Depreciation | 129100 | 129968 | 259069 |  | 259069 |
|  Goodwill amortization | 71928 | 85843 | 157771 |  | 157771 |

---

Note 1: The adjustment of (¥1,258,802 thousand) in segment profit represents unallocated corporate expenses, primarily general and administrative expenses not attributable to any reportable segment.

Note 2: Segment profit is reconciled to operating income in the consolidated statement of income.

**(b) Capital Expenditures** 

Total capital expenditures of the HEROZ Group for the consolidated fiscal year under review were JPY 419,272 thousand, primarily consisting of software and software-in-process related to the development of proprietary products.

**(c) Financing** 

During the consolidated fiscal year, the HEROZ Group procured funds through short-term borrowings of JPY 200,000 thousand and long-term borrowings of JPY 800,000 thousand from financial institutions.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(2) Financial Results for the Three Most Recent Fiscal Years** 

**(a) Consolidated Financial Highlights** 

(Note) As the Company has prepared consolidated financial statements since its 15th fiscal year, no consolidated figures are presented for the 14th fiscal year. Additionally, for the 15th fiscal year, consolidated financial statements include subsidiaries' profit and loss from the third quarter only.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **14th FY (FY Apr.<br>2022)** | **15th FY (FY Apr.<br>2023)** | **16th FY (FY Apr.<br>2024)** | **17th FY (FY Apr.<br>2025)** |
|  Net sales (¥ thousands) | – | 2980673 | 4841640 | 5929797 |
|  Ordinary income (¥ thousands) | – | 216186 | 368859 | 228233 |
|  Net loss attributable to owners of parent (¥ thousands) | – | (574334) | (1134535) | (177709) |
|  Net loss per share (¥) | – | (38.22) | (75.45) | (11.79) |
|  Total assets (¥ thousands) | – | 8673048 | 7691233 | 8147668 |
|  Net assets (¥ thousands) | – | 6080329 | 5143074 | 5201437 |
|  Net assets per share (¥) | – | 388.97 | 314.36 | 301.15 |

---

Note: The Company began preparing consolidated financial statements from the 15th fiscal year; accordingly, the 14th fiscal year results are not presented. In the 15th fiscal year, subsidiary income statements were consolidated from the third quarter onward.

**(b) Standalone Financial Highlights** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **14th FY (FY Apr.<br>2022)** | **15th FY (FY Apr.<br>2023)** | **16th FY (FY Apr.<br>2024)** | **17th FY (FY Apr.<br>2025)** |
|  Net sales (¥ thousands) | 1482969 | 1572580 | 1747091 | 2025990 |
|  Ordinary income (loss) (¥ thousands) | 87790 | 127051 | 101439 | (53283) |
|  Net income (loss) (¥ thousands) | 49401 | 80303 | (1823086) | (295951) |
|  Earnings (loss) per share (¥) | 3.29 | 5.34 | (121.24) | (19.64) |

---

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

---

| | | | | |
|:---|:---|:---|:---|:---|
|  Total assets (¥ thousands) | 6635384.0 | 6772006.0 | 5129902.0 | 5734352.0 |
|  Net assets (¥ thousands) | 6440758.0 | 6564101.0 | 4798870.0 | 4555594.0 |
|  Net assets per share (¥) | 428.65 | 434.83 | 315.05 | 295.71 |

---

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(3) Material Parent Company and Subsidiaries** 

**(a) Parent Company** 

Not applicable.

**(b) Material Subsidiaries (as of April 30, 2025)** 

---

| | | | |
|:---|:---|:---|:---|
| **Company Name** | **Paid-in Capital** | **HEROZ's<br>Equity<br>Interest** | **Principal Business** |
|  VarioSecure Inc. | ¥751,798 thousand | 42.8% | Managed security services; Integration services |
|  StrategIT Co., Ltd. | ¥34,998 thousand | 94.4% | SaaS adoption support ("JOINT") |
|  AI Squared, Inc. | ¥90,000 thousand | 53.9% | AI-powered IT services and consulting ("QuickSummary 2.0") |
|  Tifana.com, Inc. | ¥200,000 thousand | 100.0% | AI business ("AI Sakura-san" series) |
|  VOIQ Inc. | ¥500 thousand | 80.0% | AI-powered inside sales support |

---

(Note) VOIQ Inc. was incorporated as a new subsidiary in July 2024, and its business was commenced upon the
acquisition of assets from Bizy Inc. in August 2024, at which point it was included in the scope of consolidation.

**(c) Significant Affiliates** 

Not applicable.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(4) Key Challenges** 

The macroeconomic conditions and industry environment described in section (1)(i) above continue to apply. Against this backdrop, the Company considers the following challenges essential for sustained business expansion:

**(a) Responding to Emerging AI and SaaS Technologies** 

The Group has adopted "AI BPaaS" as the vision for HEROZ 3.0, aiming to go beyond being a mere SaaS tool provider by fully leveraging generative AI and multi-domain AI Agents to deliver value through Agentic Work—where AI autonomously executes and optimizes entire business workflows—to drive AIX across society. While most AI Agents currently on the market are specialized or workflow-assist agents that execute within relatively well-defined processes, the Group aims to develop the next generation—"AI Agent 2.0"—in the form of a "Meta Agent" that can autonomously decompose problems, set goals, explore and implement solutions, and fundamentally restructure entire business operations.

Executing this strategy requires AI and SaaS technologies at its core. Given the intense research and development activity in these fields both domestically and internationally, the Group recognizes the need to respond to new technologies with speed and agility.

In particular, technological competition around AI—including OpenAI's LLM "ChatGPT"—is intensifying, and the importance of adapting to new technologies is growing at an accelerating pace amid heightened attention to AI Agents and expanding enterprise investment in AIX.

The Company is actively gathering cutting-edge information as a supporting member of the Japanese Society for Artificial Intelligence and as a regular member of the Japan Deep Learning Association, and is committed to enhancing its technological capabilities.

Furthermore, in May 2024, the Company officially launched "HEROZ ASK," a generative AI-powered AI assistant SaaS, and StrategIT Co., Ltd. launched "JOINT iPaaS for SaaS," a SaaS integration platform. By expanding these services and building various integrations, we aim to further accelerate AI adoption and AIX across society. In addition, we will continue to pursue active R&D in AI, SaaS, and security fields, targeting not only updates and feature enhancements to existing SaaS products but also the realization of next-generation AI Agents and AIX in entirely new domains.

**(b) Responding to New Technologies and Societal Changes in Security Services** 

VarioSecure Inc., a Group company, operates in the internet security space, where the expansion of cloud services, changes in work styles, and increasingly sophisticated cyber attacks have caused security threats to extend beyond the traditional perimeter of internal versus external networks. Under these conditions, VarioSecure has expanded its service portfolio beyond managed security services that defend against external risks to include endpoint security services that detect and eliminate threats, as well as backup services for data protection and recovery. Under its medium-term management plan, VarioSecure intends to provide comprehensive security services as an integrated security vendor. As demand grows to address new security challenges, the company will continue to deliver services responsive to market changes.

**(c) Talent Acquisition** 

To respond promptly to market expansion in the AI and broader information services industry, increasing new entrants, diversifying customer and user needs, and rapid technological innovation, the Group recognizes the need to secure and develop talent with cutting-edge skills.

However, competition for highly skilled talent remains intense and stable talent acquisition is expected to remain challenging.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

The Group believes it is essential to enhance its market presence through technological excellence, leverage next-generation AI Agents in the recruiting domain, strengthen public relations and marketing activities, and pursue initiatives in fields that attract top talent. We also plan to strengthen internal training programs, maintain and refine human resources systems, and conduct engagement surveys to improve employee retention.

**(d) Strengthening Information Security** 

The Group currently provides AI SaaS-related services to a wide range of industries. Because such AI and SaaS solutions often require industry-specific accumulated data, the Group employs a partnership strategy with data-holding companies. As a result, the Group handles confidential customer information and enforces strict management under its Information Management Policy. We will continue to provide ongoing internal training to maintain rigorous information management.

**(e) Addressing SDGs** 

The HEROZ Group will leverage its accumulated AI and SaaS technology and data to address a variety of social challenges and realize a sustainable society. The Group's key SDG initiatives are guided by the following priority policies:

• Advancing AIX

Positioning "AI BPaaS" under "HEROZ 3.0," the Group will leverage AI to help customers achieve Agentic Work across multiple business processes.

• Contributing to Local Communities and the Environment through AI

The Group will participate in energy-saving initiatives, such as incorporating its AI into building management systems that optimize temperature and humidity.

• Creating a Rewarding Work Environment

The Group provides a comfortable work environment reflecting employee preferences, including remote work options and leave promotion. The Group also implements monitoring of overtime and occupational health interviews to prevent long working hours and overwork, and pays careful attention to the health management of officers and employees.

• Talent Development and Value Creation

The Group provides work structures and HR systems that enable each employee to develop their capabilities, and offers opportunities for self-improvement through training and regular study sessions. The Group also operates an HR system that includes incentives designed to encourage employees to leverage their individual strengths and continue taking on new challenges.

• Leading-Edge Technology Leadership

The Group conducts timely information gathering regarding the latest technologies and works to provide high-quality, cutting-edge AI.

**(f) Strengthening Systems Infrastructure** 

The Company recognizes that ensuring large-scale data processing capacity and system stability is a critical management priority for delivering the services that form the foundation of the Group's revenue. We will work to maintain stable operations through the securing of qualified personnel and the optimization of server infrastructure.

**(g) Intellectual Property Rights** 

The Group actively pursues patents and other intellectual property rights—either independently or jointly with co-development partners—to protect novel proprietary technologies arising from its daily AI solution delivery and SaaS service operations.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

However, given that major domestic and international IT companies are aggressively pursuing intellectual property rights in the AI and SaaS fields, the Group recognizes the need to secure its operational freedom through strategic patent acquisition. As we develop AI for diverse industries and expect to gain valuable insights, we will collaborate with external specialists to proactively and strategically obtain patents in our proprietary technology areas ahead of competitors.

**(h) Ensuring and Improving Service Quality, Safety and Integrity** 

The Group provides SaaS-related services including "HEROZ ASK," "JOINT," "QuickSummary 2.0," and "AI Sakura-san" in the BtoB domain, and recognizes that improving service quality and safety is a key challenge as these services continue to scale. We will continue gathering cutting-edge technologies, including generative AI, and pursue uncompromising development and improvement of new features aimed at delivering services that customers can use on a long-term basis.

In the BtoC domain, the Company provides consumer app services such as "Shogi Wars" and has established the following guidelines to ensure that users can enjoy these services safely and securely:

Company Guidelines on Safety and Integrity

**Article 1 (Purpose)** 

These guidelines set out the measures necessary for HEROZ, Inc. to provide services such as games in a manner that enables users to enjoy them safely and securely.

**Article 2 (Measures)** 

To achieve the purposes of Article 1, the following measures shall be implemented:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Strict legal compliance: The Company shall comply with the Act against Unjustifiable Premiums and Misleading Representations and all other applicable laws in developing and providing services. Services found to be unlawful in the future shall be promptly discontinued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Protection of users under 18: Age verification shall be conducted at registration or payment to prevent excessive spending by users under 18. Monthly spending limits (excluding tax) are JPY 20,000 for users under 18 and JPY 5,000 for users under 16.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Prohibition of RMT (Real Money Trading): RMT is strictly prohibited. The prohibition is stated in the terms of service, and users found to have engaged in RMT will be promptly subject to appropriate measures, including compulsory account termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) Measures against inappropriate conduct: Users engaged in conduct deemed inappropriate under the terms of service will be promptly subject to appropriate measures, including compulsory account termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) Monitoring of user communications: Communications between users will be regularly monitored to ensure they are conducted safely and securely, and any inappropriate communications will be promptly addressed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) Appropriate probability disclosure for paid items: The probability of obtaining paid items through random draw (gacha) mechanisms will be set at appropriate levels.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) Employee training and education: Training and education will be provided to employees to enhance service safety and integrity.

**Article 3 (Updates)** 

In light of changes to services, user circumstances and other social conditions, the Company shall endeavor to keep these guidelines in an optimal state.

**(i) Strengthening Internal Control** 

The HEROZ Group anticipates continued business growth and will work to build an internal control framework commensurate with the expansion of its operations and to further enhance corporate governance. The Group also recognizes that securing and developing human resources in line with its growth trajectory is a critical challenge, and will continue to pursue ongoing recruitment and training activities.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(5) Principal Business Lines (as of April 30, 2025)** 

---

| | | |
|:---|:---|:---|
| **Business Segment** | **Company** | **Business Description** |
| AIX | HEROZ, Inc. | BtoC Services (operation of "Shogi Wars"); BtoB Services (various AI solution businesses, provision of "HEROZ ASK") |
| AIX | StrategIT Co., Ltd. | SaaS implementation support; provision of "JOINT" platform |
| AIX | AI Squared, Inc. | AI-powered IT services and consulting; provision of "QuickSummary 2.0" |
| AIX | Tifana.com, Inc. | AI business (provision of "AI Sakura-san" series) |
| AIX | VOIQ Inc. | AI-powered inside sales support |
| AI Security | VarioSecure Inc. | Managed security services; integration services |

---

**(6) Principal Business Offices (as of April 30, 2025)** 

---

| | | |
|:---|:---|:---|
| **Company** | **Office** | **Location** |
| HEROZ, Inc. | Head Office | Minato-ku, Tokyo |
| VarioSecure Inc. (Subsidiary) | Head Office / Osaka Office / Fukuoka Sales Office | Chiyoda-ku, Tokyo / Nishi-ku, Osaka / Hakata-ku, Fukuoka |
| StrategIT Co., Ltd. (Subsidiary) | Head Office | Minato-ku, Tokyo |
| AI Squared, Inc. (Subsidiary) | Head Office | Minato-ku, Tokyo |
| Tifana.com, Inc. (Subsidiary) | Head Office / Osaka Office | Meguro-ku, Tokyo / Kita-ku, Osaka |
| VOIQ Inc. (Subsidiary) | Head Office | Minato-ku, Tokyo |

---

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(7) Employee Headcount (as of April 30, 2025)** 

**(a) Group-wide Headcount** 

---

| | | |
|:---|:---|:---|
| **Business Segment** | **Headcount** | **Change vs. Prior Year** |
|  AIX Business | 175 | +34 |
|  AI Security Business | 75 | +1 |
|  Reportable Segments Subtotal | 250 | +35 |
|  Corporate (shared functions) | 44 | +3 |
|  **Total** | **294** | **+38** |

---

(Notes) 1. Figures for Group company employees are based on each company's most recent fiscal year-end.

2. Headcount includes full-time employees and contract employees. Temporary employees are omitted as the total is less than 10% of the headcount.

3. Employees listed under Corporate (shared functions) belong to the administrative division.

4. The increase in AIX headcount reflects new graduate and mid-career hiring accompanying business expansion.

**(b) HEROZ, Inc. Standalone Headcount** 

---

| | |
|:---|:---|
| **Headcount** | **Change vs. Prior Year** |
| 97 | +18 |

---

(Note) Headcount includes full-time employees and contract employees.

**(8) Principal Lenders (as of April 30, 2025)** 

Group company borrowings are as follows:

---

| | | |
|:---|:---|:---|
| **Lender** | **Outstanding Borrowings** | **Outstanding Borrowings** |
|  Mizuho Bank, Ltd. | ¥ | 875,562 thousand |
|  Aozora Bank, Ltd. | ¥ | 412,500 thousand |
|  Shoko Chukin Bank, Ltd. | ¥ | 275,000 thousand |
|  Sumitomo Mitsui Banking Corporation | ¥ | 200,000 thousand |
|  Bank of Yokohama, Ltd. | ¥ | 194,400 thousand |
|  Chiba Bank, Ltd. | ¥ | 97,200 thousand |

---

(Note) Group company borrowings are based on each company's most recent fiscal year-end.

**(9) Other Material Matters Relating to the Current Status of the Corporate Group** 

Not applicable.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**2. Share Information (as of April 30, 2025)** 

---

| | |
|:---|:---|
| (1) Total authorized shares | 52,600,000 shares |
| (2) Total issued shares | 15,174,468 shares |
| (3) Number of shareholders | 12557 |

---

Note: The total number of issued shares increased by 129,316 shares during the fiscal year, consisting of an increase of 104,200 shares from the exercise of stock acquisition rights and 28,308 shares from the grant of restricted stock, offset by a decrease of 3,192 shares from the cancellation of treasury stock.

**(4) Major Shareholders** 

---

| | | |
|:---|:---|:---|
| **Shareholder Name** | **Shares Held** | **Ownership %** |
|  Takahiro Hayashi | 4337961 | 28.58% |
|  Tomohiro Takahashi | 4337961 | 28.58% |
|  The Master Trust Bank of Japan, Ltd. | 713800 | 4.70% |
|  BIGLOBE Inc. | 400000 | 2.63% |
|  Takenaka Corporation | 163132 | 1.07% |
|  Koei Tecmo Games Co., Ltd. | 161676 | 1.06% |
|  Masayuki Yamashita | 82000 | 0.54% |
|  Tatsuya Ikeda | 78452 | 0.51% |
|  Japan Custody Bank, Ltd. | 51300 | 0.33% |
|  Uyeki Co., Ltd. | 44000 | 0.28% |

---

(Notes) 1. The number of shares held in trust by the Trust Account is not known to the Company and is therefore not disclosed.

2. The Company does not hold treasury shares.

**(5) Shares Issued to Officers for Services During the Fiscal Year** 

At the 15th Annual General Meeting of Shareholders held on July 27, 2023, the Company introduced a Restricted Stock Compensation plan. Pursuant to a Board of Directors resolution at the meeting held on August 23, 2024, the Company resolved to issue new shares as restricted stock compensation and issued 12,648 new shares to four (4) Directors (excluding Audit and Supervisory Committee Members and Outside Directors) on September 19, 2024.

**3. Stock Acquisition Rights** 

(1) Status of Stock Acquisition Rights Held by Officers as of Fiscal Year-End as Compensation for Services:

Not applicable.

(2) Stock Acquisition Rights Issued to Non-Officer Employees as Compensation During the Fiscal Year:

Not applicable.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

(3) Other Material Matters Relating to Stock Acquisition Rights:

Not applicable.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**4. Director and Officer Information** 

**(1) Directors (as of April 30, 2025)** 

---

| | | |
|:---|:---|:---|
| **Title** | **Name** | **Responsibilities and Significant Concurrent Positions** |
| Representative Director, CEO | Takahiro Hayashi | Director, VarioSecure Inc. / Director, StrategIT Co., Ltd. / Director, AI Squared, Inc. / Director, Tifana.com, Inc. / Outside Director, Rakumachi, Inc. / Director, VOIQ Inc. |
| Representative Director, CRO | Tomohiro Takahashi | Director, Tifana.com, Inc. |
| Director, CTO | Keiichi Iguchi | Director, VarioSecure Inc. / Director, VOIQ Inc. |
| Director, CFO | Hiroya Mori | Director, VarioSecure Inc. / Director, StrategIT Co., Ltd. / Director, AI Squared, Inc. / Representative Director, Tifana.com, Inc. / Director, VOIQ Inc. |
| Director (Audit and Supervisory Committee Member) | Tomohiro Inoue | Representative, Venture Ink Accounting Office |
| Director (Audit and Supervisory Committee Member) | Toru Kamiyama | Managing Member, Kakeru Partners LLC / Outside Director, Bplats, Inc. / Outside Director (Audit and Supervisory Committee Member), ITSUMO Inc. / Outside Director, ISHIN Inc. / Outside Director, M&A Research Institute Holdings Inc. |
| Director (Audit and Supervisory Committee Member) | Yuko Kanamaru | Partner Attorney, Gaien Law Office / Outside Statutory Auditor, Accuris Pharma Inc. / Outside Statutory Auditor, Bleaf Inc. / Outside Director (Audit and Supervisory Committee Member), AI Inc. / Outside Director, MIRARTH Holdings Inc. |

---

(Notes) 1. Directors (Audit and Supervisory Committee Members) Tomohiro Inoue, Toru Kamiyama and Yuko Kanamaru are outside directors.

2. Director (Audit and Supervisory Committee Member) Tomohiro Inoue holds a CPA and tax accountant license and has substantial expertise in finance and accounting.

3. Director (Audit and Supervisory Committee Member) Yuko Kanamaru holds a law license and has substantial expertise in legal matters.

4. Because the Company, as a company with an Audit and Supervisory Committee, conducts systematic audits through its Audit and Supervisory Committee utilizing a deep understanding of its internal control system, the Company does not deem it necessary to appoint a standing Audit and Supervisory Committee Member.

5. The Company has designated Outside Directors Tomohiro Inoue, Toru Kamiyama and Yuko Kanamaru as independent officers pursuant to the regulations of the Tokyo Stock Exchange and has notified the Exchange accordingly.

**(2) Summary of Liability Limitation Agreements** 

The Company has entered into liability limitation agreements with all Outside Directors pursuant to Article 427, Paragraph 1 of the Companies Act, which limit their liability for damages under Article 423, Paragraph 1 of the same Act. The maximum amount of liability under each such agreement is the amount prescribed by law.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

Such limitation of liability applies only where the Outside Director acted in good faith and without gross negligence in the execution of duties that gave rise to the liability.

**(3) Directors' and Officers' Liability Insurance** 

The Company has entered into a directors' and officers' liability insurance policy with an insurance carrier pursuant to Article 430-3, Paragraph 1 of the Companies Act, covering the Company's Directors as insured persons. The policy covers losses incurred by the insured arising from claims related to their liability for the execution of their duties. The premiums are borne entirely by the Company; the insured persons bear no portion of the premium cost.

**(4) Nomination and Compensation Committee** 

The Company has established a voluntary Nomination and Compensation Committee as an advisory body to the Board of Directors. The Committee was established to ensure objectivity, transparency, and fairness in the processes for selecting Director candidates and determining Director compensation, thereby enhancing the oversight function of the Board and strengthening corporate governance.

With respect to the selection of Director candidates, the Committee examines the skill sets required of Directors, selection criteria and individual candidate proposals, and other matters necessary to identify talent aligned with the Company's management strategy. With respect to compensation, the Committee deliberates on the compensation framework, policies for determining compensation, and individual compensation amounts, with the aim of constructing a compensation system that ensures alignment with business performance while appropriately reflecting results. Through these processes, the Committee seeks to ensure transparency and fairness in decision-making and to build a system that contributes to the sustained enhancement of corporate value.

The Board of Directors makes final decisions on Director candidates and Director compensation after taking into account the recommendations of the Nomination and Compensation Committee.

The Committee members are Toru Kamiyama (Chairperson; Outside Director), Takahiro Hayashi (Representative Director, CEO), Tomohiro Inoue (Outside Director), and Yuko Kanamaru (Outside Director). A majority of the Committee is composed of Independent Outside Directors. To further enhance the objectivity and transparency of the decision-making process, the Committee is chaired by an Independent Outside Director.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(5) Director Compensation** 

**(a) Policies for Determining Individual Director Compensation (excluding Audit and Supervisory Committee Members)** 

The Company has established the following policy for determining individual compensation for Directors (excluding Directors who are Audit and Supervisory Committee Members; the same applies throughout this subsection (a) and (b)). This policy was deliberated by the Nomination and Compensation Committee and resolved by the Board of Directors upon the Committee's recommendation.

Basic Principles:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Compensation shall contribute to long-term business performance and enhancement of corporate value.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Compensation shall reflect the roles and responsibilities of each Director.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The determination process shall be made transparent through consultation with the Nomination and Compensation
Committee, which is chaired by an outside director and in which outside directors hold a majority.

Compensation Levels:

Compensation is set by reference to peer company benchmarks provided by an external expert organization, primarily taking into account the compensation levels of companies in the same industry, and considering the content and performance of each Director's duties.

Determination Process:

The Nomination and Compensation Committee deliberates based on the above principles and benchmarks and reports its conclusions to the Board of Directors. The Board then makes a final decision on each Director's individual compensation with due consideration of the Committee's report.

Compensation Structure:

Director compensation consists of fixed compensation, performance-based short-term incentive compensation (bonus) and restricted stock as a medium-to-long-term incentive.

---

| | | | |
|:---|:---|:---|:---|
|  | **Fixed Compensation** | **Performance-Based Bonus** | **Compensation Limit** |
| Basis | Paid based on role and responsibility | Determined based on quantitative and qualitative assessments. Quantitative: 5-point scale based on target achievement. Qualitative: 5-point scale based on role and behavioral outcomes. | Aggregate of fixed and performance-based compensation not to exceed JPY 150M per year (resolved at 9th AGM held July 24, 2017) |
| Calculation | 77% of total annual compensation | ~10% of total annual compensation as standard; paid at 0–200% of standard amount based on average of quantitative and qualitative scores |  |
| Payment Method | Monthly (cash) | Annual (cash); paid in the month following the month of the Annual General Meeting of Shareholders |  |

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

Restricted Stock Compensation:

As compensation for services rendered during the fiscal year, pre-delivery restricted stock is granted on an annual basis. The number of shares granted to Eligible Directors (Directors excluding Audit and Supervisory Committee Members and Outside Directors; "Eligible Directors") is determined by dividing the base amount of restricted stock compensation for the fiscal year by the closing price of the Company's common stock on the Tokyo Stock Exchange on the business day immediately preceding the Board resolution date for the allocation (or, if no trading occurred on such day, the closing price on the most recent prior trading day). The maximum annual grant shall not exceed 30,000 shares.

Unless the Board of Directors adopts a separate resolution, the transfer restrictions on all allocated shares shall be lifted upon the expiration of the restriction period, subject to the condition that the Eligible Director has continuously served as a Director, executive officer, or employee of the Company from the commencement of the restriction period through the date of the first Annual General Meeting of Shareholders following such commencement.

Ratio of Each Compensation Component to Total Individual Compensation:

The ratio among fixed compensation, performance-linked compensation, and restricted stock compensation shall be determined at an appropriate level to serve as a sound incentive. The Company seeks to promote management aimed at medium- to long-term performance improvement and corporate value maximization, and accordingly has adopted, in addition to fixed compensation, both short-term performance-linked compensation and restricted stock compensation.

**(b) Reason the Board of Directors Determined That Individual Director Compensation Is Consistent with the Policy** 

In determining individual Director compensation, the Board considered the fairness of the compensation calculation, the balance between compensation levels and each Director's duties and contributions, and the alignment with Company performance, with comprehensive review including Audit and Supervisory Committee Members, and determined that the compensation is consistent with the policy.

**(c) Compensation for Audit and Supervisory Committee Member Directors** 

Compensation for Directors who are Audit and Supervisory Committee Members shall consist of fixed compensation only. The specific amounts, payment timing and allocation shall be determined by the Audit and Supervisory Committee within the aggregate limit approved by the General Meeting of Shareholders, taking into account each member's contribution to audits.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(d) Total Compensation for the Fiscal Year** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| Category | Total Compensation<br>(¥ thousands) | Fixed<br>Compensation<br>(¥ thousands) | Performance-<br>Linked<br>(¥ thousands) | Restricted<br>Stock<br>(¥ thousands) | Number of<br>Eligible<br>Persons |
|  Directors (excl. ASC Members) (of which, Outside Directors) | 101469 (—) | 79968 (—) | 7499 (—) | 14001 (—) | 4 (—) |
|  Directors (ASC Members) (of which, Outside Directors) | 10800 (10800) | 10800 (10800) | — (—) | — (—) | 3 (3) |
|  Total (of which, Outside Directors) | 112269 (10800) | 90768 (10800) | 7499 (—) | 14001 (—) | 7 (3) |

---

Notes: At the 9th Annual General Meeting of Shareholders held on July 24, 2017, the annual compensation limit for Directors (excluding ASC Members) was set at ¥150 million (excluding employee salary components) and the annual compensation limit for Directors (ASC Members) was set at ¥25 million. At the time of such resolution, there were three (3) Directors (excluding ASC Members) and three (3) Directors (ASC Members). Separately from cash compensation, at the 15th Annual General Meeting of Shareholders held on July 27, 2023, an annual limit of ¥35 million was approved for restricted stock compensation for Eligible Directors. At the time of such resolution, there were four (4) Eligible Directors.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(6) Outside Directors** 

(a) Significant Concurrent Positions and the Company's Relationship with Such Entities

**Director (ASC Member) Tomohiro Inoue** serves as Representative of Venture Ink Accounting Office. There is no special relationship between the Company and such entity.

**Director (ASC Member) Toru Kamiyama** serves as Representative Member of Kakeru Partners LLC, Outside Director of Bplats, Inc., Outside Director (Audit and Supervisory Committee Member) of ITSUMO Inc., Outside Director of ISHIN Inc., and Outside Director of M&A Research Institute Holdings Inc. There is no special relationship between the Company and any of these entities.

**Director (ASC Member) Yuko Kanamaru** serves as Partner Attorney at Gaien Law Office, Outside Statutory Auditor of Accuris Pharma Inc., Outside Statutory Auditor of Bleaf Inc., Outside Director (Audit and Supervisory Committee Member) of AI, Inc., and Outside Director of MIRARTH Holdings, Inc. There is no special relationship between the Company and any of these entities.

(b) Principal Activities During the Fiscal Year

---

| | | |
|:---|:---|:---|
| **Position** | **Name** | **Summary of Activities** |
| Director (Audit and Supervisory Cmte.) | Tomohiro Inoue | Attended all 18 Board meetings and all 13 Audit and Supervisory Committee meetings held during the fiscal year. Actively expressed opinions at Board and Committee meetings from the perspective of a certified public accountant, playing an appropriate role in ensuring the validity and appropriateness of decision-making. |
| Director (Audit and Supervisory Cmte.) | Toru Kamiyama | Attended all 18 Board meetings and all 13 Audit and Supervisory Committee meetings held during the fiscal year. Actively expressed opinions at Board and Committee meetings drawing on broad knowledge and experience in management and finance, playing an appropriate role in ensuring the validity and appropriateness of decision-making. |
| Director (Audit and Supervisory Cmte.) | Yuko Kanamaru | Attended all 18 Board meetings and all 13 Audit and Supervisory Committee meetings held during the fiscal year. Actively expressed opinions at Board and Committee meetings from the perspective of a licensed attorney, playing an appropriate role in ensuring the validity and appropriateness of decision-making. |

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**5. Accounting Auditor** 

**(1) Name:** 

Grant Thornton Taiyo LLC

**(2) Audit Fees** 

---

| | |
|:---|:---|
|  | **Amount (JPY K)** |
|  Audit fees for the fiscal year under review | 26500 |
|  Total fees payable by the Company and its subsidiaries to the Accounting Auditor | 26500 |

---

(Notes) 1. The audit engagement does not separately distinguish audit fees for the Companies Act audit and the Financial Instruments and Exchange Act audit, and such distinction is not practically possible; accordingly, the amount stated represents the aggregate of both.

2. In addition to the above, JPY 2,000 thousand was paid during the fiscal year under review as additional fees relating to the prior fiscal year.

3. The Audit and Supervisory Committee verified that the Accounting Auditor's audit plan, execution of audit duties, and basis for fee estimates were appropriate, and consented to the Accounting Auditor's fees.

4. Among the Company's material subsidiaries, VarioSecure Inc. is audited by an audit corporation other than the Company's Accounting Auditor.

**(3) Policy on Dismissal or Non-Reappointment of the Accounting Auditor** 

The Audit and Supervisory Committee shall determine the content of proposals to be submitted to the General Meeting of Shareholders regarding the dismissal or non-reappointment of the independent auditor when the Committee determines it necessary, such as when the auditor's ability to perform its duties is impaired.

If the independent auditor is found to fall under any of the items set forth in Article 340, Paragraph 1 of the Companies Act, the Audit and Supervisory Committee shall dismiss the independent auditor with the unanimous consent of all Committee Members. In such case, an Audit and Supervisory Committee Member selected by the Committee shall report the dismissal and the reasons therefor at the first General Meeting of Shareholders convened thereafter.

**(4) Regulatory Actions Taken Against the Accounting Auditor in the Past Two Years** 

Summary of disciplinary action announced by the Financial Services Agency on December 26, 2023:

**(a) Subject of Action:** Grant Thornton Taiyo LLC

**(b) Content of Action:** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Suspension of business relating to the execution of new engagement contracts for a period of three
(3) months (January 1 through March 31, 2024; excluding renewals of existing audit contracts and new contracts entered into as a result of a client's initial listing)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Business improvement order (improvement of business management systems)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Prohibition for three (3) months (January 1 through March 31, 2024) on the involvement in a portion of
audit work (audit reviews) of the partner(s) who bore material responsibility for the conduct giving rise to the action

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(c) Reason for Action:** 

Two (2) CPAs who are partners of the audit firm, in auditing another company's correction reports, failed to exercise due professional care and certified financial statements containing material misstatements as free of material misstatements.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**6. Framework for Ensuring Proper Business Operations and Its Operational Status** 

**(1) Summary of Policies Adopted for the Framework** 

The following summarizes the resolutions adopted by the Board of Directors to ensure that directors' execution of duties complies with applicable laws and the Articles of Incorporation, and to otherwise ensure proper business operations:

**(a) System to Ensure Compliance by Directors and Employees** 

To conduct fair and honest business activities aimed at continuously enhancing corporate value, the Company shall ensure that Directors and employees are informed of and comply with applicable laws and internal rules. In cases of legal violations, the Company shall take appropriate action in accordance with the Employment Rules and other applicable policies, and shall work to strengthen its risk management framework. To this end, the Compliance Committee shall meet regularly, and internal rules shall be maintained, reviewed, and updated to enhance the risk management system. The Company shall sever all relationships with antisocial forces and organizations and shall respond firmly and on a company-wide, organizational basis to any improper demands from such forces.

The Company shall also establish an internal control reporting framework to ensure the reliability of financial reporting and shall operate and evaluate its effectiveness.

**(b) System for Retention and Management of Information Related to Directors' Execution of Duties** 

The Company shall record and appropriately store and manage information relating to the execution of directors' duties in accordance with the Board of Directors Rules, Authority and Responsibility Rules, and Approval Rules. The Company shall also establish Information Management Rules to protect and manage information assets.

**(c) Risk Management Framework** 

The Company shall conduct regular internal audits by its internal audit personnel to appropriately evaluate and recognize risks associated with business operations and take preventive measures for each risk, thereby preventing, avoiding and minimizing losses arising from violations of laws, regulations, the Articles of Incorporation or other causes.

**(d) Framework for Efficient Execution of Directors' Duties** 

To ensure appropriate and efficient execution of directors' duties, the Company shall establish Board of Directors Rules governing the operation of the Board. The Board shall hold regular meetings in principle once per month and extraordinary meetings as necessary to deliberate and resolve significant management matters. Additionally, reporting and information sharing shall be conducted as appropriate at various meetings and through written approvals.

**(e) Framework for Ensuring Proper Business Operations across the Corporate Group** 

• Subsidiary management and reporting: The Company has established Related Companies Management Rules to ensure
that the Company and its subsidiaries cooperate with each other and that the corporate group operates effectively and efficiently.

• Risk management for subsidiaries: The Company regularly requests subsidiaries to report on their business
execution status including financial performance, and Group personnel deployed as directors and statutory auditors at subsidiaries directly confirm the business execution status of subsidiary officers and employees, thereby managing and supervising
subsidiary management risks.

• Efficient execution of duties by subsidiary directors: Subsidiaries establish internal regulations appropriate to
their size and business, and define their chain of command, authority and decision-making and organizational standards.

• Compliance by subsidiary directors and employees: The Company works with subsidiary internal audit personnel to
share audit results conducted at the Company and subsidiaries and verify their appropriateness. The Company also conducts direct internal audits of subsidiaries as necessary.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(f) Independence of Personnel Assisting the Audit and Supervisory Committee** 

If an Audit and Supervisory Committee Member requests the appointment of personnel to assist in the performance of duties, the Company shall endeavor to strengthen the framework for such assistants from the perspective of ensuring effective audits, and shall ensure that such assistants do not simultaneously serve in roles related to operational execution.

**(g) Effectiveness of the Audit and Supervisory Committee's Instructions to Assisting Personnel** 

To ensure the effectiveness of instructions from the Audit and Supervisory Committee to directors and employees assisting in audit duties, such personnel shall follow exclusively the instructions of the Audit and Supervisory Committee in performing those duties, and shall not be subject to instructions from Directors other than Audit and Supervisory Committee Members.

**(h) Reporting Framework for Directors and Employees to the Audit and Supervisory Committee; Non-Retaliation** 

The Company shall build a framework enabling Audit and Supervisory Committee Members to attend important management meetings, receive reports from directors and others on the status of duty execution, review important approval documents, and obtain management and other information, and shall also ensure Audit and Supervisory Committee Members can regularly exchange opinions with the Representative Director, the independent auditor and the Internal Audit Division.

Directors and employees of the Company shall report to the Audit and Supervisory Committee upon discovering any facts that could cause significant harm to the Company, including fraud, violations of laws or the Articles of Incorporation, or matters reported via internal whistle-blowing channels. The Internal Reporting Rules shall ensure that persons who make such reports are not subject to adverse treatment.

**(i) Prompt Reimbursement of Audit and Supervisory Committee Expenses** 

When an Audit and Supervisory Committee Member requests advance payment or reimbursement of costs incurred in performing duties, the Company shall promptly respond to such request.

**(j) Other Measures to Ensure Effectiveness of the Audit and Supervisory Committee** 

The Representative Director and internal audit personnel shall have regular exchanges of opinions with the Audit and Supervisory Committee Members. The Audit and Supervisory Committee Members shall participate in the Board of Directors meetings and attend important internal meetings as necessary to receive significant reports. The Audit and Supervisory Committee shall coordinate with the internal audit division and the Accounting Auditor to ensure effective audits.

**(2) Summary of Operational Status** 

**(a) Risk Management Status** 

The Company manages risks in accordance with its Risk Management Policy to prevent incidents before they occur and minimize any losses. The Company has also established a framework for receiving advice from outside experts including attorneys, CPAs, patent attorneys, tax accountants and social insurance/labor consultants as needed, and verifies and evaluates the effectiveness of risk management through internal audits and Audit and Supervisory Committee audits.

**(b) Internal Audit and Audit and Supervisory Committee Audit Status** 

Given the Company's relatively small scale, no independent internal audit department has been established. Internal audits are conducted by the head of the department responsible for corporate planning, who serves as the internal audit officer. When the audit target is within the internal audit officer's own area of responsibility, a person from another department conducts the audit under the direction of the Representative Director. The internal audit officer conducts audits based on an internal audit plan approved by the Representative Director to ensure business effectiveness and efficiency, reports audit results to the Representative Director, provides recommendations for improvement to the audited departments, and subsequently verifies the status of corrective actions.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

The internal audit officer holds regular meetings with Audit and Supervisory Committee Members and the independent auditor to share information necessary for the audit process.

**7. Fundamental Policy on Corporate Control** 

The Company believes that any person who controls the Company's financial and business policies should focus management resources on pursuing stable growth and maximizing corporate value and the common interests of shareholders.

At this time, the Company has not adopted any specific anti-takeover measures. However, we will continue to monitor changes in the social environment and will consider appropriate measures as circumstances warrant.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**HEROZ, Inc. — Consolidated Financial Statements** 

Fiscal Year Ended April 30, 2025 (May 1, 2024 – April 30, 2025)

**Consolidated Balance Sheet** 

(As of April 30, 2025)

---

| | | | |
|:---|:---|:---|:---|
|  | | (JPY thousands) | (JPY thousands) |
| **ASSETS** | **Amount** | **LIABILITIES** | **Amount** |
|  **Current Assets** | **4538859** | **Current Liabilities** | **1487282** |
|  Cash and deposits | 1733938 | Accounts payable – trade | 142492 |
|  Accounts receivable – trade | 831717 | Short-term borrowings | 200000 |
|  Contract assets | 64421 | Current portion of long-term borrowings | 483464 |
|  Inventories | 152783 | Income taxes payable | 51977 |
|  Deposits held with third parties | 1410387 | Contract liabilities | 212497 |
|  Other | 345610 | Accrued bonuses | 43689 |
|  |  | Shareholder benefit program reserve | 18322 |
|  |  | Other | 334839 |
|  **Non-Current Assets** | **3608808** | **Non-Current Liabilities** | **1458948** |
|  Property, plant and equipment | 215401 | Long-term borrowings | 1371198 |
|  Buildings and structures | 22352 | Retirement benefit liability | 9120 |
|  Tools, furniture and fixtures | 178572 | Other | 78630 |
|  Construction in progress | 14476 | **Total Liabilities** | **2946230** |
|  Intangible assets | 2572398 |  |  |
|  Goodwill | 1896451 | **NET ASSETS** |  |
|  Software | 474832 | **Shareholders' Equity** | **4551663** |
|  Software in progress | 201114 | Common stock | 44746 |
|  Investments and other assets | 821009 | Capital surplus | 5302739 |
|  Investment securities | 356294 | Retained earnings (deficit) | (795822) |
|  Deferred tax assets | 200689 | **Accumulated Other Comprehensive Income** | **18089** |

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

---

| | | | |
|:---|:---|:---|:---|
|  Other | 264024 | Net unrealized gains on available-for-sale securities | 18089 |
|  |  | **Stock acquisition rights** | **68297** |
|  |  | **Non-controlling interests** | **563386** |
|  |  | **Total Net Assets** | **5201437** |
|  **Total assets** | **8147668** | **Total Liabilities and Net Assets** | **8147668** |

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Consolidated Statement of Income** 

(May 1, 2024 – April 30, 2025)

---

| | | |
|:---|:---|:---|
|  | (JPY thousands) | (JPY thousands) |
|  | | **Amount** |
|  Net sales |  | 5929797 |
|  Cost of sales |  | 3241852 |
|  Gross profit |  | 2687944 |
|  Selling, general and administrative expenses |  | 2381515 |
|  Operating income |  | 306429 |
|  Non-operating income |  |  |
|  Interest income | 955 |  |
|  Foreign exchange gains | 727 |  |
|  Subsidy income | 3550 |  |
|  Proceeds from surrender of insurance policies | 2717 |  |
|  Interest on tax refund | 24 |  |
|  Other | 3094 | 11069 |
|  Non-operating expenses |  |  |
|  Interest expense | 18160 |  |
|  Loss on investment securities | 24210 |  |
|  Shareholder benefit program expenses | 40770 |  |
|  Other | 6124 | 89265 |
|  Ordinary income |  | 228233 |
|  Extraordinary losses |  |  |
|  Impairment loss | 96987 | 96987 |
|  Income before income taxes |  | 131245 |
|  Income taxes – current | 122363 |  |
|  Income taxes – deferred | (16359) | 106003 |
|  Net income |  | 25241 |
|  Net income attributable to non-controlling interests |  | 202951 |
|  **Net loss attributable to owners of the parent** |  | **(177709)** |

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Consolidated Statement of Changes in Shareholders' Equity** 

(May 1, 2024 – April 30, 2025) (JPY thousands)

**Shareholders' Equity** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Common<br>Stock** | **Capital<br>Surplus** | **Retained Earnings<br>(Deficit)** | **Treasury<br>Stock** | **Total<br>Shareholders'<br>Equity** |
|  **Balance at beginning of period** | 21784 | 5305332 | (618113) |  | 4709003 |
|  **Changes during the period** |  |  |  |  |  |
|  Issuance of new shares | 22962 | 22962 |  |  | 45924 |
|  Net loss attributable to owners of the parent |  |  | (177709) |  | (177709) |
|  Acquisition of treasury stock |  |  |  | (152) | (152) |
|  Cancellation of treasury stock |  | (152) |  | 152 |  |
|  Changes in parent's ownership interest due to transactions with non-controlling interests |  | (25402) |  |  | (25402) |
|  Net changes in items other than shareholders' equity |  |  |  |  |  |
|  **Total changes during the period** | 22962 | (2592) | (177709) |  | (157339) |
|  **Balance at end of period** | **44746** | **5302739** | **(795822)** | **—** | **4551663** |

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Accumulated Other Comprehensive Income, Stock Acquisition Rights, Non-Controlling Interests** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Net**<br>**Unrealized**<br>**Gains on**<br>**Available-**<br>**for-Sale**<br>**Securities** | **Total**<br>**Accumulated**<br>**Other**<br>**Comprehensive**<br>**Income** | **Stock**<br>**Acquisition**<br>**Rights** | **Non-**<br>**Controlling**<br>**Interests** | **Total Net<br>Assets** |
|  **Balance at beginning of period** | 20571 | 20571 | 58912 | 354587 | 5143074 |
|  **Changes during the period** |  |  |  |  |  |
|  Issuance of new shares |  |  |  |  | 45924 |
|  Net loss attributable to owners of the parent |  |  |  |  | (177709) |
|  Acquisition of treasury stock |  |  |  |  | (152) |
|  Cancellation of treasury stock |  |  |  |  |  |
|  Changes in parent's ownership interest due to transactions with non-controlling interests |  |  |  | (3414) | (28816) |
|  Net changes in items other than shareholders' equity | (2482) | (2482) | 9385 | 212213 | 219116 |
|  **Total changes during the period** | (2482) | (2482) | 9385 | 208799 | 58363 |
|  **Balance at end of period** | **18089** | **18089** | **68297** | **563386** | **5201437** |

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**HEROZ, Inc. — Notes to Consolidated Financial Statements** 

**Note 1. Significant Accounting Policies** 

**(1) Scope of Consolidation** 

Number of consolidated subsidiaries: 5

VarioSecure Inc., StrategIT Co., Ltd., AI Squared, Inc., Tifana.com, Inc., VOIQ Inc.

VOIQ Inc., incorporated as a new subsidiary during the consolidated fiscal year, has been included in the scope of consolidation.

**(2) Application of the Equity Method** 

Not applicable.

**(3) Fiscal Year-End of Consolidated Subsidiaries** 

All consolidated subsidiaries have a fiscal year-end of the last day of February. The financial statements of each consolidated subsidiary as of its fiscal year-end are used in preparing the consolidated financial statements; however, necessary adjustments are made on consolidation for material transactions occurring between each subsidiary's fiscal year-end and the consolidated fiscal year-end.

**(4) Significant Accounting Policies** 

**(a) Valuation of Significant Assets** 

i. Other securities

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Securities other than those with no quoted market price: Fair value method (unrealized gains and losses are
recognized in net assets using the full net-assets method; cost of sales is calculated using the moving-average method)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Securities with no quoted market price: Cost method using the moving-average method

ii. Inventories

Merchandise, work-in-process, and supplies: Cost method using the moving-average method (balance sheet amounts determined by the write-down method based on decline in profitability)

**(b) Depreciation of Significant Depreciable Assets** 

i. Property, plant and equipment (excluding leased assets)

The declining-balance method. However, building improvements and structures acquired on or after April 1, 2016 are depreciated using the straight-line method. Low-value depreciable assets with acquisition cost between JPY 100K and JPY 200K are depreciated equally over three (3) years.

Principal useful lives: Buildings: 3–18 years; Tools, furniture and fixtures: 3–15 years

ii. Intangible assets (excluding leased assets)

Internal-use software is amortized on a straight-line basis over the expected useful life within the Company (no longer than 5 years).

**(c) Deferred Asset Treatment** 

Share issuance costs: Expensed in full at the time of payment.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(d) Significant Provisions** 

i. Allowance for doubtful accounts: Recorded based on the historical loss rate for general receivables; estimated uncollectible amounts are individually assessed for specific doubtful receivables.

ii. Provision for bonuses: Estimated bonus payments attributable to the consolidated fiscal year are recorded.

iii. Shareholder benefit program reserve: Recorded for the estimated future utilization of shareholder reward points granted under the shareholder reward program.

**(e) Retirement Benefit Accounting** 

Certain consolidated subsidiaries apply the simplified method for calculating retirement benefit liabilities, using the amount payable upon voluntary resignation at year-end.

**(f) Revenue Recognition** 

(i) AIX Business

(BtoC Services)

For item purchases, the Company has determined that the performance obligation is satisfied when the user uses the item to play a game and the Company renders services defined for each item. Accordingly, revenue is recognized for items that have been used by the end of the reporting period, and the balance of unused items is transferred to contract liabilities.

Similarly, for paid membership monthly fees, the performance obligation is satisfied as the Company renders the services defined for each member. Accordingly, the full monthly fee is recognized as revenue, and the unused portion of the member benefit items granted as of the end of the reporting period is transferred to contract liabilities.

(BtoB Services)

For initial setup fees, because the fulfillment of the performance obligation creates an asset with no alternative use and the Company has an enforceable right to payment for work completed, the performance obligation is considered to be satisfied over time. Revenue and contract assets are recognized based on the degree of progress toward satisfaction of the performance obligation as measured at the end of the reporting period.

Progress is measured using the input method, as costs are considered to be incurred as work progresses. Specifically, the percentage of completion is estimated by comparing actual labor hours incurred to date against total estimated labor hours to contract completion.

For recurring fees, the performance obligation is considered to be satisfied over time, and revenue is recognized monthly in accordance with the contract terms.

(ii) AI Security Business

(Managed Security Services)

The Company provides managed security services consisting of operational management services. Because these services are delivered over the contract term and are satisfied over time based on the passage of time, revenue is recognized over the contract period. Revenue is recognized ratably over the contract period, as the performance obligation is satisfied through the provision of services to the customer over the contractually specified period.

Payment for these services is received by the end of the month following, or the second month following, the month in which revenue is recognized.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

(Integration Services)

The Company provides sales of integrated security appliances and licensed software to SME customers.

Revenue from the sale of VCR (Vario Communicate Router) integrated security appliances is recognized when the product is delivered and accepted by the customer, as control of the product transfers at that point—the customer can freely use or resell the product and is entitled to the associated economic benefits.

Revenue from licensed software is recognized over the license period, as the Company has a performance obligation to provide services throughout such period. Revenue is recognized ratably over the contract period, as the performance obligation is satisfied through the provision of services to the customer over the contractually specified period.

Payment for appliance sales is invoiced upon delivery and is generally received in full by the end of the month following, or the second month following, the month in which revenue is recognized. Payment for licensed software is received in full at the commencement of service delivery.

**(g) Goodwill Amortization** 

Goodwill is amortized on a straight-line basis over a period of 9 to 15 years.

**Note 2. Critical Accounting Estimates** 

**(1) Goodwill Impairment** 

**(a) Amount Recorded in the Consolidated Financial Statements** 

Goodwill: JPY 1,896,451 thousand

**(b) Significant Accounting Estimates** 

Goodwill breakdown at fiscal year-end:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• JPY 987,195K: Arising from the consolidation of VarioSecure Inc. in September 2022

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• JPY 240,810K: Arising from the consolidation of AI Squared, Inc. in November 2023

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• JPY 632,444K: Arising from the consolidation of Tifana.com, Inc. in March 2024 and additionally recognized as
contingent consideration

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• JPY 36,000K: Recognized by VOIQ Inc., incorporated during the consolidated fiscal year

In each case, goodwill was recorded based on an assessment of excess earning power derived from the target company's business plan and other factors at the time of acquisition.

Goodwill is assessed for indicators of impairment based on the occurrence of sustained operating losses at group companies, significant deterioration of the business environment, or significant deviation from business plans, among other factors. When an impairment indicator is identified, the carrying amount is compared to undiscounted future cash flows estimated based on the relevant business plan for the remaining amortization period. If impairment recognition is warranted, the carrying amount is reduced to the recoverable amount and the difference is recognized as an impairment loss.

While the identification of impairment indicators and the recognition and measurement of impairment losses are conducted with due care, these assessments may be affected by changes in business plans and the operating environment. If actual results differ from the estimates, there may be a material impact on the consolidated financial statements of the following fiscal year.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(2) Impairment of Other Non-Current Assets** 

**(a) Amounts Recorded** 

Property, plant and equipment ¥215,401 thousand

Intangible assets (excluding goodwill) ¥675,947 thousand

Impairment loss ¥96,987 thousand

**(b) Information Regarding Critical Accounting Estimates** 

For other non-current assets, the Company periodically assesses each asset group for indicators of impairment. When an impairment indicator is identified, the recoverable amount is estimated using future cash flows expected from the asset group. Future cash flow projections take into account future market trends and business conditions. If projected future cash flows change and recoverability is no longer deemed sufficient, an impairment loss may be recognized. During the fiscal year under review, the Company recognized an impairment loss on a portion of software at its subsidiary StrategIT Co., Ltd.

The key assumptions used in the impairment assessment include revenue and expense projections and planned capital expenditure attributable to the relevant asset group, as well as the discount rate applied to future cash flows after considering uncertainty. These assumptions are determined based on historical and recent performance and the operating environment. For StrategIT Co., Ltd.'s software, following a detailed review of the business plan and future cash flows based on the above assumptions, an impairment loss was recognized for the portion determined to be unrecoverable.

The impairment loss recognized during the fiscal year relates to only a portion of the software. After considering future business plans and the operating environment, the portion deemed recoverable continues to be carried as software, and the remaining balance of such software as of fiscal year-end was ¥98,006 thousand.

While the identification of impairment indicators and the recognition and measurement of impairment losses are conducted with due care, these assessments may be affected by changes in business plans and the operating environment. If actual results differ from the estimates, there may be a material impact on the consolidated financial statements of the following fiscal year.

**(3) Recoverability of Deferred Tax Assets** 

Amount recorded: Deferred tax assets ¥200,689 thousand

The Group assesses the recoverability of deferred tax assets by reasonably estimating future taxable income in subsequent consolidated fiscal years. Changes in the operating environment could result in material adjustments in the following year.

**Note 3. Consolidated Balance Sheet** 

**(1) Inventory Breakdown** 

---

| | | |
|:---|:---|:---|
|  Merchandise | ¥ | 8,028 thousand |
|  Supplies | ¥ | 138,884 thousand |
|  Work-in-process | ¥ | 5,870 thousand |

---

**(2) Accumulated depreciation of property, plant and equipment: ¥886,599 thousand** 

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**(3) Allowance for doubtful accounts deducted directly from assets:** 

Current assets ¥ 622 thousand <br> Investments and other assets ¥ 7,129 thousand

**(4) Revolving Credit Facilities** 

VarioSecure Inc., a consolidated subsidiary, has entered into revolving credit facility agreements with four (4) financial institutions for efficient working capital procurement. The undrawn balance under these facilities is as follows:

---

| | |
|:---|:---|
|  Total facility limit | ¥1,100,000 thousand |
|  Outstanding borrowings |  |
|  Available undrawn balance | ¥1,100,000 thousand |

---

**Note 4. Consolidated Statement of Changes in Shareholders' Equity** 

**(1) Type and Total Number of Shares Issued and Outstanding at Fiscal Year-End** 

Common shares: 15,174,468

Note: The total number of issued shares increased by 129,316 shares during the fiscal year, consisting of an increase of 28,308 shares from the grant of restricted stock and 104,200 shares from the exercise of stock acquisition rights, offset by a decrease of 3,192 shares from the cancellation of treasury stock.

**(2) Treasury Shares at Fiscal Year-End** 

Not applicable.

**(3) Stock Acquisition Rights Outstanding at Fiscal Year-End (excluding those where exercise period has not yet commenced)** 

Common shares: 154,200 shares

**Note 5. Financial Instruments** 

**(1) Status of Financial Instruments** 

(a) Policy: The Group limits investment of temporary surplus funds to short-term deposits. Borrowings are obtained from multiple financial institutions.

(b) Nature and Risks

Trade receivables (accounts receivable) are exposed to customer credit risk.

Investment securities consist of equity interests in business partners and investments in investment partnerships, and are exposed to issuer credit risk.

Deposits held with third parties are exposed to the credit risk of the depository.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

Trade payables (accounts payable and accrued expenses) are all due within one year and are exposed to liquidity risk.

Long-term and short-term borrowings are exposed to liquidity risk and interest rate fluctuation risk.

(c) Risk Management:

(i) Credit Risk

Accounts receivable are managed by the corporate planning department in accordance with accounting regulations—separately for amounts collected by platform operators and for direct collections on a customer-by-customer basis—through due date and balance management.

Investment securities are monitored through periodic review of the issuer's financial condition and verification of the rationale for holding.

(ii) Liquidity Risk

Trade payables are managed by the corporate planning department through monthly payment forecasting and the maintenance of adequate liquidity.

(iii) Interest Rate Risk

Interest rate risk is managed through market monitoring by the corporate planning department.

(d) Supplementary Information

Fair values include market-based prices and, where market prices are unavailable, reasonably estimated values. Such values incorporate variable factors and may change under different assumptions.

**(2) Fair Value of Financial Instruments (as of April 30, 2025)** 

The carrying amounts, fair values, and differences as of April 30, 2025 are as follows. Cash and deposits, accounts receivable, deposits, accounts payable, accrued expenses, and short-term borrowings are omitted because they are either cash or are settled in the short term and their fair values approximate carrying amounts.

---

| | | | |
|:---|:---|:---|:---|
|  | Carrying Amount<br>(¥ thousands) | Fair Value<br>(¥ thousands) | Difference<br>(¥ thousands) |
|  Investment securities | 8000 | 8000 |  |
|  Current portion of long-term borrowings | 483464 | 484219 | 755 |
|  Long-term borrowings | 1371198 | 1367111 | (4086) |

---

Note 1. Scheduled repayment of long-term borrowings after the consolidated fiscal year-end:

(Thousands of yen)

Within 1 Year <u>1–2 Years</u> <u>2–3 Years</u> <u>3–4 Years</u> <u>4–5 Years</u> <u>Over 5 Years</u> <br> 483,464 483,464 347,614 215,984 215,984 108,152

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

Financial instruments not measured at fair value (carrying amounts):

Non-listed equity securities: JPY 54,297K

Investments in limited liability investment partnerships: JPY 293,997K

**(3) Fair Value Hierarchy** 

Financial instruments are classified into three levels based on the observability and significance of inputs used in fair value measurement:

Level 1: Quoted prices in active markets for identical assets or liabilities

Level 2: Observable inputs other than Level 1 quoted prices

Level 3: Unobservable inputs

When multiple inputs significant to the measurement are used, the instrument is classified at the lowest priority level among those inputs.

Financial instruments measured at fair value on the consolidated balance sheet:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 | Level 2 | Level 3 | Total |
|  Investment securities | – |  | 8000 | 8000 |

---

(Thousands of yen)

Note: Investment securities consist of stock acquisition rights in unlisted companies. As quoted prices are not available, fair value is based on recent independent arm's-length transaction prices or financing prices when such information is available. Because the fair value measurement uses unobservable inputs, these securities are classified as Level 3.

Financial instruments not measured at fair value on the consolidated balance sheet:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Level 1 | Level 2 | Level 3 | Total |
|  Current portion of long-term borrowings | – | 484219 | – | 484219 |
|  Long-term borrowings | – | 1367111 | – | 1367111 |

---

(Thousands of yen)

Note: Variable-rate long-term borrowings (including the current portion) reflect market interest rates in the short term, and fair value is therefore considered to approximate carrying amount. Accordingly, the carrying amount is used as the fair value, classified as Level 2. Fixed-rate borrowings are measured using the discounted present value method based on the total of principal and interest payments, using a discount rate that incorporates the remaining term and credit risk, and are classified as Level 2.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Note 6. Revenue Recognition** 

**(1) Revenue Disaggregated by Service Category (JPY thousands)** 

---

| | |
|:---|:---|
|  | **Current Fiscal Year** |
|  **AIX Business** | 3262257 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; BtoC Services | 1163144 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; BtoB Services | 2017427 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other | 81685 |
|  **AI Security Business** | 2667539 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Managed Security Services | 2344542 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Integration Services | 322997 |
|  **Revenue from contracts with customers** | **5929797** |
|  **Net sales to external customers** | **5929797** |

---

**(2) Basis for Understanding Revenue** 

See Note 1 (4)(f) above.

**(3) Contract Assets and Contract Liabilities (JPY thousands)** 

---

| | | |
|:---|:---|:---|
|  | **Current Year** | **Current Year** |
|  Receivables from contracts (opening) |  | 736303 |
|  Receivables from contracts (closing) |  | 831717 |
|  Contract assets (opening) |  | 61897 |
|  Contract assets (closing) |  | 64421 |
|  Contract liabilities (opening) |  | 454625 |
|  Contract liabilities (closing) |  | 291127 |

---

**Note 7. Per-Share Information** 

(1) Net assets per share JPY 301.15 <br> (2) Loss per share JPY (11.79)

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Note 8. Subsequent Events** 

Not applicable.

**Note 9. Other Notes — Business Combinations** 

**(1)** **Finalization of Provisional Accounting Treatment for Business Combination** 

With respect to the business combination with Tifana.com, Inc. in the prior consolidated fiscal year, the purchase price allocation had not been completed at that time, and provisional accounting treatment was applied. During the current consolidated fiscal year, the purchase price allocation was completed, and the impact on the prior fiscal year's consolidated balance sheet is immaterial.

**(2) Accounting for Contingent Consideration in a Business Combination** 

With respect to the acquisition of Tifana.com, Inc. by the Company on March 25, 2024, a portion of the contingent consideration became fixed during the current fiscal year. The payment was treated as acquisition cost deemed to have arisen at the time of acquisition, and additional goodwill was recognized as follows:

Additional acquisition cost recognized (goodwill): ¥55,165 thousand

Additional goodwill amortization: ¥3,677 thousand

Amortization method and period: Straight-line over 15 years

The content of the contingent consideration as stipulated in the business combination agreement and the accounting treatment going forward are as follows:

(a) Content of Contingent Consideration

For the three consecutive fiscal years following the share acquisition, an amount calculated by applying a specified rate to the revenue from Tifana.com's AI business is expected to arise as price adjustment consideration.

(b) Future Accounting Treatment

If changes in the acquisition cost occur, the Company's policy is to adjust the acquisition cost, goodwill amount, and goodwill amortization accordingly.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**HEROZ, Inc. — Standalone Financial Statements** 

**Standalone Balance Sheet** 

(As of April 30, 2025)

(JPY thousands)

---

| | | | |
|:---|:---|:---|:---|
| **ASSETS** | **Amount** | **LIABILITIES** | **Amount** |
|  **Current Assets** | **2368505** | **Current Liabilities** | **779648** |
|  Cash and deposits | 566338 | Accounts payable – trade | 26602 |
|  Accounts receivable – trade | 209335 | Short-term borrowings | 200000 |
|  Contract assets | 62790 | Current portion of long-term borrowings | 267480 |
|  Prepaid expenses | 91251 | Accounts payable – other | 92006 |
|  Deposits held with third parties | 1410387 | Accrued expenses | 28533 |
|  Other | 28401 | Contract liabilities | 80736 |
|  |  | Deposits received | 21047 |
|  |  | Accrued bonuses | 17239 |
|  |  | Shareholder benefit program reserve | 18322 |
|  |  | Other | 27680 |
|  **Non-Current Assets** | **3365847** | **Non-Current Liabilities** | **399110** |
|  Property, plant and equipment | 99748 | Long-term borrowings | 399110 |
|  Buildings | 6482 | **Total Liabilities** | **1178758** |
|  Tools, furniture and fixtures | 93266 |  |  |
|  Intangible assets | 211550 | **NET ASSETS** |  |
|  Software | 204157 | **Shareholders' Equity** | **4469207** |
|  Software in progress | 7393 | Common stock | 44746 |
|  Investments and other assets | 3054548 | Capital surplus | 5345260 |
|  Investment securities | 371794 | Capital reserve | 2250356 |

---

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

---

| | | | |
|:---|:---|:---|:---|
|  Shares of subsidiaries and affiliates | 2566409 | Other capital surplus | 3094904 |
|  Long-term loans to subsidiaries and affiliates | 50000 | Retained earnings (deficit) | (920799) |
|  Long-term prepaid expenses | 5538 | Other retained earnings | (920799) |
|  Deferred tax assets | 35311 | Retained earnings carried forward | (920799) |
|  Other | 32493 | **Valuation and Translation Adjustments** | **18089** |
|  Allowance for doubtful accounts | (7000) | Net unrealized gains on available-for-sale securities | 18089 |
|  |  | **Stock Acquisition Rights** | **68297** |
|  |  | **Total Net Assets** | **4555594** |
|  **Total Assets** | **5734352** | **Total Liabilities and Net Assets** | **5734352** |

---

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Standalone Statement of Income** 

(May 1, 2024 – April 30, 2025)

(JPY thousands)

---

| | | |
|:---|:---|:---|
|  | | **Amount** |
|  **Net sales** |  | **2025990** |
|  **Cost of sales** |  | **1172650** |
|  **Gross profit** |  | **853339** |
|  **Selling, general and administrative expenses** |  | **837299** |
|  **Operating income** |  | **16039** |
|  **Non-operating income** |  |  |
|  Interest income | 772 |  |
|  Subsidy income | 3300 |  |
|  Other | 567 | **4639** |
|  **Non-operating expenses** |  |  |
|  Interest expense | 5181 |  |
|  Loss on investment securities | 24210 |  |
|  Shareholder benefit program expenses | 40770 |  |
|  Other | 3800 | **73962** |
|  **Ordinary loss** |  | **(53283)** |
|  **Extraordinary losses** |  |  |
|  Loss on valuation of shares of subsidiaries and affiliates | 231892 | **231892** |
|  **Loss before income taxes** |  | **(285175)** |
|  Income taxes – current | 7455 |  |
|  Income taxes – deferred | 3320 | **10775** |
|  **Net loss** |  | **(295951)** |

---

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Standalone Statement of Changes in Shareholders' Equity** 

(May 1, 2024 – April 30, 2025)

(JPY thousands)

**Shareholders' Equity** 

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Common<br>Stock** | **Capital<br>Surplus** | | | **Retained<br>Earnings** | **Treasury<br>Stock** | **Total<br>Shareholders'<br>Equity** |
| Capital Reserve | Other<br>Capital<br>Surplus | Capital<br>Surplus<br>Total | Retained<br>Earnings<br>Carried<br>Forward | Retained<br>Earnings<br>Total |  |  |  |
|  **Balance at beginning of period** | 21784 | 2227393 | 3095056 | 5322450 | (624848) |  | 4719386 |
|  **Changes during the period** |  |  |  |  |  |  |  |
|  Issuance of new shares | 22962 | 22962 |  | 22962 |  |  | 45924 |
|  Net loss |  |  |  |  | (295951) |  | (295951) |
|  Acquisition of treasury stock |  |  |  |  |  | (152) | (152) |
|  Cancellation of treasury stock |  |  | (152) | (152) |  | 152 |  |
|  Net changes in items other than shareholders' equity |  |  |  |  |  |  |  |
|  **Total changes during the period** | 22962 | 22962 | (152) | 22810 | (295951) |  | (250178) |
|  **Balance at end of period** | **44746** | **2250356** | **3094904** | **5345260** | **(920799)** | **—** | **4469207** |

---

**Valuation / Translation Adjustments, Stock Acquisition Rights and Total Net Assets** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Net Unrealized**<br>**Gains on Available-**<br>**for-Sale Securities** | **Total Valuation and<br>Translation<br>Adjustments** | **Stock Acquisition<br>Rights** | **Total Net Assets** |
|  **Balance at beginning of period** | 20571 | 20571 | 58912 | 4798870 |
|  **Changes during the period** |  |  |  |  |
|  Issuance of new shares |  |  |  | 45924 |
|  Net loss |  |  |  | (295951) |
|  Acquisition of treasury stock |  |  |  | (152) |

---

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

---

| | | | |
|:---|:---|:---|:---|
|  Cancellation of treasury stock |  |  |  |
|  Net changes in items other than shareholders' equity | (2482) | 9385 | 6902 |
|  **Total changes during the period** | (2482) | 9385 | (243276) |
|  **Balance at end of period** | **18089** | **68297** | **4555594** |

---

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**HEROZ, Inc. — Notes to Standalone Financial Statements** 

**Note 1. Significant Accounting Policies** 

**(1) Valuation of Securities** 

(a) Subsidiary stocks: Cost method using the moving-average method.

(b) Other securities:

Securities other than those with no quoted market price: Fair value method (unrealized gains/losses recognized in net assets; cost of sales calculated using moving-average method).

Securities with no quoted market price: Primarily the cost method using the moving-average method.

Investments in limited liability investment partnerships (deemed securities under Article 2, Paragraph 2 of the Financial Instruments and Exchange Act): The Group's proportionate share of net assets is incorporated based on the most recent financial statements of each partnership as of the reporting date specified in the partnership agreement.

**(2) Depreciation of Non-Current Assets** 

(a) Property, plant and equipment: Declining-balance method. Building improvements and structures acquired on or after April 1, 2016 use the straight-line method. Assets between JPY 100K and JPY 200K are depreciated equally over 3 years. Principal useful lives: Buildings: 3–15 years; Tools, furniture and fixtures: 3–10 years.

(b) Intangible assets: Internal-use software is amortized on a straight-line basis over the expected useful life within the Company (no longer than 5 years).

**(3) Deferred Asset Treatment** 

Share issuance costs: Expensed in full at the time of payment.

**(4) Provisions** 

(a) Allowance for doubtful accounts: Recorded based on the historical loss rate for general receivables; individually assessed for specific doubtful receivables.

(b) Provision for bonuses: Estimated bonus payments attributable to the fiscal year are recorded.

(c) Shareholder benefit program reserve: Recorded for estimated future utilization of shareholder reward points.

**(5) Revenue Recognition** 

(a) BtoC Services: Revenue from item purchases is recognized as the performance obligation is satisfied (as users utilize items in games). Monthly premium membership fees are recognized monthly; items granted as benefits are deferred and recognized upon use.

(b) BtoB Services: Initial setup fees are recognized using the input method over time. Ongoing fees are recognized monthly over the service period.

**Note 2. Critical Accounting Estimates** 

**(1) Recoverability of Deferred Tax Assets** 

(a) Amount Recorded

Deferred tax assets ¥35,311 thousand

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

(b) Information Regarding the Estimate

As the same information is disclosed in "Notes to the Consolidated Financial Statements — Note 2. Critical Accounting Estimates — (3) Recoverability of Deferred Tax Assets," the description is omitted here.

**(2) Valuation of Investments in Subsidiaries** 

(a) Amount Recorded

Shares of subsidiaries and affiliates ¥2,566,409 thousand

(b) Information Regarding the Estimate

For equity securities with readily determinable fair values, when such fair value declines significantly, the securities are written down to fair value and the resulting valuation difference is recognized as a loss for the fiscal year, unless recovery is considered probable.

For investments in unlisted subsidiaries and affiliates and other securities without readily determinable fair values, the carrying amount is based on acquisition cost. However, when the financial condition of the issuing company has deteriorated and the real value of the investment has declined significantly, the investment is written down by an appropriate amount and the resulting valuation difference is recognized as a loss for the fiscal year, unless recoverability is supported by sufficient evidence.

During the fiscal year under review, the Company recognized a loss on valuation of shares of subsidiaries and affiliates of ¥231,892 thousand with respect to shares of StrategIT Co., Ltd.

The assessment of the valuation of shares of subsidiaries and affiliates is based on the achievement of each subsidiary's business plan and its future business prospects. If changes in a subsidiary's performance, business plans, or market environment result in changes to the content of these estimates, there may be a material impact on the valuation of shares of subsidiaries and affiliates in the financial statements of the following fiscal year.

**Note 3. Balance Sheet** 

**(1)** Accumulated depreciation of property, plant and equipment: **¥466,611 thousand**

**(2) Monetary Receivables from and Payables to Related Companies (excluding amounts separately stated on the balance sheet)** 

---

| | | |
|:---|:---|:---|
|  Accounts receivable – trade | ¥ | 946 thousand |
|  Accounts receivable – other | ¥ | 2,161 thousand |
|  Accounts payable – other | ¥ | 5,216 thousand |

---

**(3) Guarantees** 

The Company has provided the following debt guarantees for the consolidated subsidiary indicated below:

Tifana.com, Inc. — Bank borrowings ¥85,408 thousand

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Note 4. Income Statement** 

**Transactions with Related Companies** 

---

| | | |
|:---|:---|:---|
|  Operating transactions |  |  |
|  Net sales | ¥ | 6,203 thousand |
|  Cost of sales | ¥ | 1,093 thousand |
|  Selling, general and administrative expenses | ¥ | 13,271 thousand |
|  Non-operating transactions |  |  |
|  Interest income | ¥ | 375 thousand |

---

**Note 5. Statement of Changes in Shareholders' Equity** 

Treasury shares at fiscal year-end: Not applicable.

**Note 6. Related Party Transactions** 

**Subsidiaries and Affiliates** 

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| Type | Company<br>Name | Ownership<br>(%) | Relationship | Transaction | Amount<br>(¥ thousands) | Account | Balance at<br>Year-End<br>(¥ thousands) |
|  Subsidiary | StrategIT<br>Co., Ltd. | Direct:<br>94.36%<br>(Note 2) | Concurrent<br>directorship;<br>office<br>sublease,<br>etc. | Subscription<br>to third-<br>party<br>allotment<br>(Note 3) | 199,998<br> (Note 1) |  |  |
|  Subsidiary | Tifana.com,<br>Inc. | Direct:<br>100.00%<br>(Note 2) | Concurrent<br>directorship;<br>debt<br>guarantee,<br>etc. | Debt<br>guarantee<br>(Note 4) | 85408 |  |  |
|  Subsidiary | VOIQ Inc. | Direct:<br>80.00%<br>(Note 2) | Concurrent<br>directorship;<br>business<br>loans; office<br>sublease,<br>etc. | Business<br>loan<br>(Note 5) | 50000 | Long-term<br>loans to<br>subsidiaries<br>and<br>affiliates | 50000 |

---

Terms and Policies for Determining Transaction Terms:

Note 1: Transaction amounts do not include consumption tax.

Note 2: Ownership percentages are as of fiscal year-end.

Note 3: At the Board of Directors meeting held on May 28, 2024, the Company resolved to subscribe for the entire third-party allotment of new shares issued by StrategIT Co., Ltd. and acquired such shares.

Note 4: This represents a guarantee of the subsidiary's bank borrowings. The transaction amount represents the outstanding guarantee balance as of the end of the fiscal year. No guarantee fees were charged.

Note 5: The business loan was made at terms determined by mutual agreement based on prevailing market interest rates. No collateral has been received.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Note 7. Revenue Recognition** 

Basis for Understanding Revenue from Contracts with Customers

As the same information is disclosed in "Notes to the Consolidated Financial Statements — Note 6. Revenue Recognition," the description is omitted here.

**Note 8. Income Tax Effects** 

**Breakdown of Deferred Tax Assets and Deferred Tax Liabilities by Major Cause** 

---

| | |
|:---|:---|
| **Deferred Tax Assets** | |
|  Loss on valuation of investment securities | ¥25,491 thousand |
|  Excess depreciation | ¥10,702 thousand |
|  Accrued bonuses | ¥5,962 thousand |
|  Contract liabilities | ¥19,432 thousand |
|  Shareholder benefit program reserve | ¥2,767 thousand |
|  Amortization of security deposits | ¥1,536 thousand |
|  Performance-linked compensation | ¥3,442 thousand |
|  Share-based compensation expense | ¥10,788 thousand |
|  Shares of subsidiaries and affiliates | ¥742,019 thousand |
|  Other | ¥8,252 thousand |
|  **Subtotal deferred tax assets** | ¥**830,394 thousand** |
|  Valuation allowance | **782,263 thousand)** |
|  **Total deferred tax assets** | ¥**48,131 thousand** |
|  **Deferred Tax Liabilities** |  |
|  Accrued enterprise tax receivable | 3,253 thousand) |
|  Net unrealized gains on available-for-sale securities | 9,565 thousand) |
|  **Total deferred tax liabilities** | **12,819 thousand)** |
|  **Net deferred tax assets** | **35,311 thousand)** |

---

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Note 9. Per-Share Information** 

(1) Net assets per share ¥ 295.71 <br> (2) Net loss per share ¥ 19.64

**Note 10. Subsequent Events** 

Not applicable.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Independent Auditor's Report — Consolidated Financial Statements** 

June 19, 2025

To the Board of Directors of HEROZ, Inc.:

**Grant Thornton Taiyo LLC** 

Tokyo Office

**Audit Opinion** 

Pursuant to Article 444, Paragraph 4 of the Companies Act, we have audited the consolidated financial statements of HEROZ, Inc. for the consolidated fiscal year from May 1, 2024 to April 30, 2025, comprising the Consolidated Balance Sheet, Consolidated Statement of Income, Consolidated Statement of Changes in Shareholders' Equity and Notes to Consolidated Financial Statements.

In our opinion, the above consolidated financial statements present fairly, in all material respects, the financial position and results of operations of the group consisting of HEROZ, Inc. and its consolidated subsidiaries for the period covered by the consolidated financial statements, in conformity with accounting principles generally accepted in Japan.

**Basis for Opinion** 

We conducted our audit in accordance with auditing standards generally accepted in Japan. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Company and its consolidated subsidiaries in accordance with the ethical requirements applicable to the profession in Japan, and have fulfilled our other ethical responsibilities. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

**Other Information** 

Other information consists of the Business Report and its supplementary schedules. Management is responsible for the preparation and disclosure of the other information. The Audit and Supervisory Committee's responsibility is to oversee the directors' performance of their duties in the process of preparing and disclosing the other information.

Our audit opinion on the consolidated financial statements does not cover the other information, and we do not express an opinion on it. Our responsibility in connection with the audit of the consolidated financial statements is to read the other information and, in doing so, consider whether there is a material inconsistency between the other information and the consolidated financial statements or our knowledge obtained in the audit, or whether the other information otherwise appears to be materially misstated. Based on our procedures, we have nothing to report in this regard.

**Responsibilities of Management and the Audit and Supervisory Committee for the Consolidated Financial Statements** 

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with accounting principles generally accepted in Japan, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, management is responsible for assessing the Group's ability to continue as a going concern and disclosing, as applicable, matters relating to going concern in accordance with accounting principles generally accepted in Japan.

The Audit and Supervisory Committee's responsibility is to oversee the directors' performance of their duties in the financial reporting process.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Auditor's Responsibilities for the Audit of the Consolidated Financial Statements** 

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with auditing standards generally accepted in Japan will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with auditing standards generally accepted in Japan, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Identify and assess the risks of material misstatement, whether due to fraud or error, design and perform audit
procedures responsive to those risks, and obtain sufficient appropriate audit evidence. The selection and application of audit procedures is a matter of auditor judgment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of internal control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by management.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on
audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Evaluate whether the overall presentation, structure and content of the consolidated financial statements,
including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events faithfully.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Plan and perform the Group audit to obtain sufficient appropriate audit evidence regarding the financial
information of the entities within the Group, and maintain responsibility for the direction, supervision and review of the group audit work.

We communicate with the Audit and Supervisory Committee regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also communicate regarding compliance with ethical requirements relating to independence and matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

**Interests** 

There are no interests between the Company and its consolidated subsidiaries, and our firm or any of our engagement partners, that are required to be disclosed under the Certified Public Accountants Act.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Independent Auditor's Report — Standalone Financial Statements** 

June 19, 2025

To the Board of Directors of HEROZ, Inc.:

**Grant Thornton Taiyo LLC** 

Tokyo Office

**Audit Opinion** 

Pursuant to Article 436, Paragraph 2, Item 1 of the Companies Act, we have audited the financial statements and supplementary schedules (the "Financial Statements, Etc.") of HEROZ, Inc. for the 17th fiscal year from May 1, 2024 to April 30, 2025, comprising the Balance Sheet, Statement of income, Statement of Changes in Shareholders' Equity, Notes to Standalone Financial Statements and their supplementary schedules.

In our opinion, the above Financial Statements, Etc. present fairly, in all material respects, the financial position and results of operations of the Company for the period covered thereby, in conformity with accounting principles generally accepted in Japan.

**Basis for Opinion** 

We conducted our audit in accordance with auditing standards generally accepted in Japan. We are independent of the Company in accordance with the ethical requirements applicable to the profession in Japan, and have fulfilled our other ethical responsibilities. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

**Other Information** 

Other information consists of the Business Report and its supplementary schedules. Management is responsible for the preparation and disclosure of the other information. The Audit and Supervisory Committee's responsibility is to oversee the directors' performance of their duties in the preparation and disclosure of the other information. Our responsibility in connection with the audit of the Financial Statements, Etc. is to read the other information and consider whether there is a material inconsistency with the Financial Statements, Etc. or our audit knowledge. We have nothing to report.

**Responsibilities of Management and the Audit and Supervisory Committee** 

Management is responsible for the preparation and fair presentation of the Financial Statements, Etc. in accordance with accounting principles generally accepted in Japan, and for such internal control as management determines is necessary. Management is also responsible for assessing going concern and disclosing relevant matters when applicable. The Audit and Supervisory Committee's responsibility is to oversee the directors' performance in the financial reporting process.

**Auditor's Responsibilities** 

Our objectives are to obtain reasonable assurance about whether the Financial Statements, Etc. as a whole are free from material misstatement, whether due to fraud or error. Our responsibilities include identifying and assessing material misstatement risks, evaluating the appropriateness of accounting policies and estimates, and evaluating the overall presentation of the Financial Statements, Etc. We communicate with the Audit and Supervisory Committee regarding significant audit findings and independence matters.

**Interests** 

There are no interests between the Company and our firm or any of our engagement partners that are required to be disclosed under the Certified Public Accountants Act.

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HEROZ, Inc. / VarioSecure Inc. \| 11th AGM Electronically Provided Matters

**Audit Report — Audit and Supervisory Committee** 

The Audit and Supervisory Committee hereby reports on the results of the audit of directors' performance of their duties for the 17th fiscal year from May 1, 2024 to April 30, 2025, as follows:

**1. Audit Methods and Content** 

The Audit and Supervisory Committee received regular reports from directors and employees on the establishment and operation of the framework for ensuring proper business operations (the internal control system) pursuant to Article 399-13, Paragraph 1, Item 1(b) and (c) of the Companies Act, and requested explanations as necessary to express opinions on the matter. The Committee also conducted audits by the following methods:

(i) In accordance with the audit policies and division of duties established by the Audit and Supervisory Committee, and in coordination with the internal control division, the Committee attended important meetings, received reports from directors and employees on the status of the performance of their duties, sought explanations as necessary, reviewed important approval documents, and investigated the state of operations and assets at the head office and principal business locations. With respect to subsidiaries, the Committee communicated with and obtained information from directors and statutory auditors of each subsidiary and, as necessary, received reports on operations from subsidiaries.

(ii) The Committee monitored and verified that the Accounting Auditor maintained its independence and performed the audit appropriately, received reports from the Accounting Auditor on the status of its audit, sought explanations as necessary, and received notice from the Accounting Auditor that systems for ensuring proper performance of its professional duties (the matters set forth in each item of Article 131 of the Company Calculation Rules) had been established in accordance with the Quality Control Standards for Auditing (Business Accounting Council), and sought explanations as necessary.

Based on the above methods, the Committee reviewed the Business Report and its supplementary schedules, the Financial Statements (Balance Sheet, Statement of income, Statement of Changes in Shareholders' Equity and Notes to Standalone Financial Statements) and their supplementary schedules, and the Consolidated Financial Statements (Consolidated Balance Sheet, Consolidated Statement of Income, Consolidated Statement of Changes in Shareholders' Equity and Notes to Consolidated Financial Statements) for the fiscal year under review.

**2. Audit Results** 

(1) Audit Results on the Business Report, Etc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Business Report and its supplementary schedules present the Company's status fairly in accordance with applicable laws and the Articles of Incorporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No fraudulent acts or material violations of laws, regulations or the Articles of Incorporation were found with respect to the performance of duties by directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The content of the Board of Directors' resolution on the internal control system is appropriate. No matters requiring comment were found with respect to the relevant disclosures in the Business Report or the performance of duties by directors.

(2) Audit Results on the Financial Statements and Supplementary Schedules

The audit methods and results of the Accounting Auditor, Grant Thornton Taiyo LLC, are appropriate.

(3) Audit Results on the Consolidated Financial Statements

The audit methods and results of the Accounting Auditor, Grant Thornton Taiyo LLC, are appropriate.

June 20, 2025

HEROZ, Inc. — Audit and Supervisory Committee

(Note) Audit and Supervisory Committee Members Tomohiro Inoue, Toru Kamiyama and Yuko Kanamaru are outside directors as defined under Article 2, Item 15 and Article 331, Paragraph 6 of the Companies Act.