MDB Capital Holdings, LLC

Item 1A. Risk Factors

In addition to the information set forth in this Form 10-Q, you should also carefully review and consider the risk factors contained in our other registration statements, reports and periodic filings with the SEC that could materially and adversely affect our business, financial condition, and results of operations. The risk factors we have identified and discussed, however, do not identify all risks that we face because our business operations could also be affected by additional factors that are not known to us or that we currently consider to be immaterial to our operations.

Changes to United States tariff and import/export regulations and the conflict in the Persian Gulf may have an adverse effect on our business, financial condition and results of operations.

The United States has enacted and continues to enact significant new tariffs, and President Trump has directed various federal agencies to further evaluate key aspects of U.S. trade policy. There has been and are ongoing discussions and commentaries regarding potential significant changes to U.S. trade policies, treaties and tariffs. There exists significant uncertainty about the future relationship between the U.S. and other countries with respect to such trade policies, treaties and tariffs. The U.S. and Israel have undertaken military action in the Persian Gulf, a result of which has been a reduction in oil, fertilizer and other resources exports from the region. These actions may have a material adverse effect on global and domestic economic conditions, whether or not there will be a recession, and the stability of global and domestic financial markets, and may significantly reduce global trade and, in particular, trade between the impacted nations and the U.S. As a primary part of our business is focused on financial services, that segment of our business and the value of our financial assets may be adversely impacted. These actions and policies may also adversely affect the ability of our subsidiaries to carry on their respective businesses. Although it is not yet possible to assess their impact, any of these factors could depress economic activity and restrict access to suppliers or customers and have a material adverse effect on our overall business, financial condition and results of operations.

Government Action on tariffs and research grants and other funding may impede our ability to conduct our research and to raise capital by and for our partner companies and other clients.

Federal government actions to impose tariffs, to change trade policies, to change immigration policies, to reduce the size of the Federal government, and to limit research grants and other forms of federal government funding, including direct government grants and the funding of universities and research enterprises, are causing disruption in the economy and to some extent may adversely impact our consolidated business activities based on their direct and indirect effect on our partner companies and our other clients. Many of these government actions have been only recently implemented, others are being threatened and many will be ongoing. Therefore the full impact has yet to be realized by the Company and its partner companies and clients. Nonetheless, (i) tariffs are likely to increase the cost of doing business in the general economy and to make it more difficult to obtain items where imported equipment is required by our own activities and the activities of our partner companies and clients, (ii) ending or reducing research funding is likely to make it more difficult to find collaborative research partners to work with us and our partner companies as government funding is an indirect support for research and product development activities, and (iii) the curtailment of direct funding will have an immediate adverse impact on our partner companies and clients and their ability to continue their development work. We also believe that as these policies are implemented, it will make raising capital from private investors far more difficult, as they will want to know if the Company will be able to use the proceeds effectively and will be of sufficient amount.

Impact of Ukrainian, Israeli, and Iran Conflicts

Currently, we believe that the ongoing conflicts involving Ukraine, Israel, and Iran do not have any direct impact on our operations, financial condition, or financial reporting. We believe these conflicts will have only a general impact on our operations in the same manner as they are having on all businesses with operations in North America. This general impact may result from international sanctions and embargo regulations, possible shortages of goods and components that may be supplied from Ukraine, Russia, the Persian Gulf countries or Israel, disruptions to global energy supplies and oil prices due to tensions in the Strait of Hormuz and the broader Middle East region, supply chain challenges, and the international and U.S. domestic inflationary effects of the conflicts and related government spending. We do not believe we will be specifically targeted for cyberattacks in connection with these conflicts. However, as a financial institution, we are aware that we may be a general target for cyber-attacks, including potentially from state-sponsored actors. We have no operations in the countries directly involved in these conflicts and are not specifically impacted by any of the related sanctions or embargoes, as we principally operate in the United States. Other than general securities market trends, we do not have reason to believe that investors will evaluate the company as having special risks or exposures related to these conflicts.