We are a large and growing pachinko hall operator in Japan. Libera Gaming Operations, Inc. was founded in Japan in May 1965 and has been operating pachinko halls for over 58 years. Pachinko halls provide a venue for customers to play two types of recreational arcade games: “pachinko” and “pachislot,” which are played using pachinko balls and pachislot tokens, respectively, for the purpose of obtaining more balls and tokens and exchanging them for prizes. Customers can convert some prizes into cash by having independent buyers from pachinko halls buy them. The pachinko and pachislot industry is highly regulated under Japanese laws and regulations. Playing pachinko and pachislot machines are not considered a form of gambling in Japan because customers do not directly win cash. They win tokens that may be redeemed for prizes, which in turn may be sold for cash by independent buyers. We have over 58 years of experience in the pachinko industry, operating eleven pachinko halls in Japan as of March 15, 2024. There are only 161 pachinko hall operators that operate more than ten pachinko halls out of a total of 1,623 operators in Japan as of 2023, and we are one of the largest pachinko hall operators as we are in top 10% of all pachinko hall operators with respect to the number pachinko halls operated (Source: “Pachinko hall operator survey 2023”, Yano Research Institute). For the years ended October 31, 2023 and 2022, with respect to our pachinko operation business, we reported total revenues of ¥4,874,215 thousand (US$32,182 thousand) and ¥3,966,010 thousand, respectively.
