In dealing with HD Faculty™'s risk management issues, from time to time, it is required to address transaction risk, revenue risk, counterparty risk, country risk, industry risk, credit risk, market risk and work-in-progress risk in respect to contractual obligations:

1. Transaction Risk. Transaction risk is a risk factor that HD Faculty™ is confronted with in connection with a transaction that it has agreed to undertake pertaining to the development of an H-DISPIV™ or otherwise for, and on behalf of its foreign clients. In such case, HD Faculty™ is faced with various counterparty related risk factors, such as foreign client credit risk; political risk; travel and terrorism risk; foreign exchange risk; and technology risk.
2. Revenue Risk. Revenue risk is a risk factor that HD Faculty™ is faced with in the market pertaining to its fees and charges; the demand for its products and services; the ability to meet the demand of the target market in a timely manner due to the lack of essential revenue; and any factors or events that restrain or inhibit HD Faculty™ from generating the required revenue to meet its commitments.
3. Counterparty Risk. Counterparty Risk is risk relating to the Client’s or counterparty’s validity, credibility, authority to act and fulfill one’s commitment on time.
4. Country Risk. On a country-by-country basis, HD Faculty™'s Risk Management Team is required to examine the environment in which HD Faculty™ operates in respect to the host country. Their tactical plan involves the performance of sectors and economic indicators assessment, and relevant political considerations of the sovereign risk of the Countries of domicile.
5. Industry Risk. On a country-by-country basis, the Risk Management Team is required to define the strengths weaknesses, opportunities, threats and issues of the industry within the economy and relative to the economic trends. Their primary focus is on the domestic industry: (a) characteristics; (b) barriers to entry; (c) demand factors; (d) business cyclicality; (e) regulatory regime; (f) potential legislation; (g) economic forces impacts; (h) impact of technological changes; (i) supply and distribution factors; and (j) basic financial characteristics of the business.
6. Credit, Market and Work-in-progress Risk. In addition to the foregoing, the Risk Management Team is required to make it their priority to manage HD Faculty™'s credit, market, and work-in-progress [operational] risk exposure, in accordance with the prevailing internationally accepted “Risk Management” policies and prevention procedures” and those of HD Faculty™.
7. Priority of Claims Risk. Subject to the Canadian Income Tax Act, the government in right of the host [domicile] country has priority claim, namely, taxes, unless otherwise exempt, over HD Faculty™'s assets.
8. Receivables Risk. HD Faculty™ is subject to a number of external risks in respect to its accounts receivables. Some of HD Faculty™'s possible receivable risks are set out (a) third party non-performance; (b) delayed payment due to bureaucracy; (c) political; and (d) liquidity risk. Therefore; it has undertaken to protect itself from unexpected loss by protecting its accounts receivable, on a case-by-case basis.