What changed in this filing

/stocks — the workspaceLOADING

Item 1A. Risk Factors

2024-03-22 compared with 2023-03-24 · 1577 added, 1425 removed, 1635 unchanged (65% of the section changed)

3 unchanged sentences

The risks described

below are not all inclusive.

We may face other

risks that are not presently known, or that we presently

deem immaterial.

not presently

presently deem

which may also adversely

affect our business, results

of operations, liquidity and

financial condition.

of these known

or unknown risks

or uncertainties actually

our business, results

of operations, liquidity

and financial condition

be materially and adversely affected.

Summary of Risk Factors

Our business is subject to

a number of risks

that could cause actual results

to differ materially from

those indicated by

a number of risks that could

cause actual results to differ

materially from those indicated

forward-looking statements

10-K or presented

elsewhere from

time to time.

are discussed

more fully in this Item 1A and include, without limitation, the

8 unchanged sentences

repay a loan.

The continuing

COVID-19 pandemic

adversely affect

our business,

financial condition,

liquidity, capital and

results of operations.

Inflationary pressures and rising prices may affect

5 unchanged sentences

industry causing disruptive deposit outflows and other destabilizing

Changes in U.S.

trade policies and other global political

factors beyond our control may adversely impact us.

operations, growth and prospects.

trade policies

global political factors

control, including the

imposition of tariffs,

Our lending business is subject to credit risk, which could

lead to unexpected losses.

The potential for the replacement or discontinuation of London Inter-bank Offered Rate, or LIBOR, as a benchmark

interest rate could present operational problems

and result in market disruption.

Natural disasters and severe weather events in Florida

could have a material adverse impact on us.

Our business is subject to interest rate risk.

A failure or the perceived risk

of a failure to raise the statutory

debt limit of the U.S.

could have a material adverse

effect on our business, financial condition and results

of operations.

The transition from the use of LIBOR may adversely impact the interest rates paid

on certain financial instruments.

financial condition and operations.

Our business is subject to

interest rate risk and variations

in interest rates may

materially and adversely affect

financial performance.

material adverse effect on our business, financial

condition and results of operations.

Our allowance for credit losses may not be sufficient

1 unchanged sentence

Our commercial loan portfolio may expose us to increased

The imposition of limits by the bank regulators

on commercial real estate lending

activities could curtail our growth

and adversely affect our earnings.

The imposition of further limits

by the bank regulators

on commercial real estate

lending activities could curtail our

growth and adversely affect our earnings.

Our SBA lending program depends on our status as a participant in the SBA's Preferred Lenders Program, and we

5 unchanged sentences

increased BSA/AML risk.

USCB Financial Holdings, Inc.

We may not recover all amounts that are contractually

owed to us by our borrowers.

Non-performing assets take significant time to resolve and

adversely affect us.

USCB Financial Holdings, Inc.

Non-performing assets

take significant time

to resolve and

adversely affect

our results of

operations and financial

condition, and could result in further losses in the future.

lending secured by

3 unchanged sentences

own the underlying

subjecting us to the costs and potential risks associated

with the ownership of real property and other risks.

We are subject to certain operational risks,

such as fraud and data processing system failures and errors.

We are subject to liquidity risk, which could adversely

affect our financial condition and results of

We have several large depositor relationships, the

loss of which could adversely affect

The value of our securities in our investment portfolio

may decline in the future.

We may not effectively execute on our expansion

subjecting us

costs and potential

risks associated with

the ownership

other risks, including

environmental

substantially raise the cost of foreclosure or prevent us

from foreclosing at all.

We are exposed to risk of environmental liability when

we take title to property.

We are subject to

certain operational risks, including, but

not limited to, customer, employee or

third-party fraud and

data processing system failures and errors.

We face significant

operational risks because

the nature of the

financial services business

involves a high volume

of transactions.

We have several large depositor

relationships, the loss of

which could force us to

fund our business through more

expensive and less stable sources.

not effectively

our expansion

adversely affect

historical growth and earnings trends.

New lines of business, products, product enhancements

or services may subject us to additional risk.

Additional capital we need may not be available on terms

acceptable to us or may dilute our shareholders.

Our strategy to grow through mergers or acquisitions may not be

successful or, if successful,

may produce risks in

successfully integrating and managing the merged companies

or acquisitions and may dilute our shareholders.

We may lose one or more of our key personnel

or fail to attract and retain other highly qualified personnel.

future growth

may require us

additional capital

on terms acceptable to us or may be dilutive to existing shareholders.

We may grow through mergers or

acquisitions, a strategy that may

not be successful or, if successful, may produce

shareholders.

The loss of one or more

of our key personnel, or

our failure to attract and

retain other highly qualified

the future, could harm our business.

Damage to our reputation could significantly harm our

We face strong competition and must respond

to rapid technological changes to remain competitive.

failure, interruption, or breach in the security of our or our contracted vendors’ systems could adversely affect us.

We rely on other companies to provide key components

of our business infrastructure.

Litigation and regulatory actions could subject us to significant

liabilities or restrictions.

Certain of our directors may have conflicts of interest

in presenting business opportunities to us.

strong competition

from financial

banking services,

which could materially and adversely affect our

We must respond to rapid technological changes

to remain competitive.

We continually

encounter technological change,

have fewer resources

our competitors

to invest in technological improvements.

failure, interruption, or breach in the

security of our systems, or those

of our contracted vendors, could disrupt

business, result in the disclosure of confidential information, damage our reputation, and

create significant financial

and legal exposure.

We rely on other companies to provide key components of our business infrastructure and our operations could be

interrupted if

our third-party

service providers

experience difficulty,

terminate their

banking regulations.

penalties, judgments

or other requirements

increased expenses or

restrictions on

USCB Financial Holdings, Inc.

Certain of our

directors may

have conflicts of

interest in determining

whether to present

business opportunities

us or another entity with which they are, or may become, affiliated.

Risks Related to Our Tax, Accounting

and Regulatory Compliance

We may be unable to recognize the benefits of deferred

The accuracy of our financial statements could be affected

by our judgments, assumptions or estimates.

As a new public company,

we may not create an effective internal control

We operate in a highly regulated environme

Our participation in the SBA PPP loan program exposes

us to noncompliance risk and litigation risk.

We face a risk of noncompliance with the Bank

Secrecy Act and other anti-money laundering laws.

Our ability to

recognize the benefits

of our deferred

tax assets is

dependent on future

cash flows and

taxable income

and may be materially impaired upon significant changes

in ownership of our common stock.

The accuracy of

our financial statements

and related disclosures

could be affected

if the judgments,

or estimates used in our critical accounting policies are inaccurate.

As a new public company, we may not efficiently or effectively create an effective internal control environment,

completeness of our financial

reports and our access

to the capital

markets, cause the price

of our Class A

stock to decline and subject us to regulatory penalties.

We operate in a highly

regulated environment, and the

laws and regulations that

govern our operations, corporate

governance, executive

compensation and

accounting principles, or

changes in them,

or our failure

to comply with

them, could adversely affect us.

noncompliance

regulations and corresponding enforcement proceedings.

We are subject to capital adequacy requirements

that may become more stringent.

We are periodically subject to examination and scrutiny

by a number of banking agencies.

We are subject to numerous laws and regulations

of certain regulatory agencies designed to protect consumers.

and may become subject to more stringent capital requirements,

which could adversely affect our financial condition

and operations.

We are periodically subject to examination and scrutiny by a number of

banking agencies and, depending upon the

findings and determinations of these agencies, we may

be required to make adjustments to our

business that could

adversely affect us.

numerous laws

and regulations

regulatory agencies

protect consumers,

including the

Community Reinvestment

could lead to a wide variety of sanctions.

Climate change

3 unchanged sentences

Risks Related to Our Class A Common Stock

Ability to pay dividends on our common stock

is subject to restrictions.

USCB Financial Holdings, Inc.

The market price and trading volume of our Class A common

stock may be volatile.

There are significant restrictions in our Articles of Incorporation

that restrict the ability to sell our capital stock.

reporting and other requirements applicable to emerging growth

Our ability to pay dividends is subject to restrictions.

The market price and trading volume of our Class A common stock may be volatile, which could result in rapid and

substantial losses for our shareholders.

significant restrictions

Incorporation

that restrict

shareholders that would own 4.95% or more of our stock,

excluding our Significant Investors.

exemptions from various reporting

and other requirements applicable

to emerging growth companies,

common stock could be less attractive to investors.

standards for an

“emerging growth company,”

our financial statements

may not be comparable

to companies that

comply with these accounting standards as of the public

company effective dates.

We have existing investors that

6 unchanged sentences

regulatory limitations on changes of control of the Company.

USCB Financial Holdings, Inc.

Risks Related to our Business and Operations

35 unchanged sentences

loan originations and increases in delinquencies and foreclosures, which would have a greater negative effect on us than if

geographically diversified.

estate collateral

Moreover, since

a large portion

portfolio is secured

by properties located

in South Florida,

the occurrence of

natural disaster, such

as a hurricane, or a man-made disaster

could result in a decline in loan originations,

a decline in the

of delinquencies,

originated by

further losses

the properties

underlying our

loans, which would have an adverse impact on our results

of operations and financial condition.

our lending were more geographically diversified.

Furthermore, the economic disruption spurred

by the continuing COVID-

Additionally,

remote work options,

potentially influencing the

long-term performance of

office properties within

our commercial

real estate portfolio.

If we are required

to liquidate our real estate collateral

securing a loan during a period of

estate values

adversely affected.

large portion

our loan portfolio

is secured by

properties located in

South Florida, the occurrence

disaster, such as a hurricane,

or a man-made disaster could result in a decline in loan originations,

a decline in the value or the destruction of mortgaged

properties and an increase in

the risk of delinquencies, foreclosures

or loss on loans

originated by us.

suffer further

losses due to the decline

in the value of the

properties underlying our mortgage loans, which would

have an adverse impact

on our results of operations and financial condition.

A downturn in the local economy generally may lead to loan losses that are not offset by operations in other markets;

9 unchanged sentences

financial condition and results of operations.

In addition, there are

continuing concerns related

to, among other things,

In addition, there are continuing concerns related

to, among other things, the increasing

level of U.S.

government debt

actions that may

address that debt,

price fluctuations of key

natural resources, inflation, the

potential resurgence

of economic and political tensions with China, the Russian invasion of Ukraine and

continuing high oil prices due to, among

other things, Russian supply disruptions, each of

which may have a destabilizing effect

on financial markets and economic

business spending,

conditions and/or

other negative

or international

credit markets

may significantly

business, the

value of our loans and investments, and our ongoing

operations, costs and profitability.

and fiscal actions that may be taken to address that debt, price fluctuations

of key natural resources, inflation, the potential

resurgence of economic and political tensions with China,

the continuing war in Ukraine, the

conflict in Gaza and continuing

higher oil prices due to, among other things, Russian supply disruptions resulting from

the ongoing Ukrainian conflict, each

of which may have a destabilizing effect on financial markets and economic activity.

Economic pressure on consumers and

international

economies may significantly

affect the markets

do business, the

loans and investments,

ongoing operations, costs and profitability.

business developments, which may impair a borrower's

ability to repay a loan.

needs of small- to

medium-sized businesses, or SMBs, and

needs of SMBs and

the owners and operators of

those businesses.

SMBs generally

have fewer financial resources in terms of capital or borrowing capacity than larger entities, frequently have smaller market

shares than their competition, may be

more vulnerable to economic

downturns, often need substantial additional

aggregate, may impair

their ability as

a borrower to

repay a loan.

These factors may

impact SMBs significantly

result of the effects of the COVID-19 pandemic.

In addition, the success of SMBs often depends on the management skills,

talents and efforts of a small group of

key people, and the death, disability or

resignation of one or more of these individuals

general economic

conditions negatively

USCB Financial Holdings, Inc.

impact the markets in which we operate

or any of our borrowers otherwise are

affected by adverse business developments,

disproportionately

affected, which could have a material adverse effect

on our business, financial condition and results of operations.

SMBs generally have

fewer financial resources in terms

of capital or

borrowing capacity

than larger entities,

frequently have

smaller market shares

than their competition,

experience substantial

volatility in

operating results,

which, individually

the aggregate,

their ability

as a borrower

to repay a loan.

In addition, the success

of SMBs often

depends on the management

skills, talents and efforts

disability or

resignation of

these individuals

adverse impact on

the business and

its ability to

repay its loan.

If general economic

conditions negatively impact

in which we operate

or any of our

borrowers otherwise are affected by adverse

business developments, our SMB borrowers

may be disproportionately affected and their ability to

repay outstanding loans may be adversely affected, which could

a material adverse effect on our business, financial

condition and results of operations.

condition, liquidity, capital and results

of operations.

The extent and duration

continuing COVID-19 pandemic

will affect our

business in the

future is unknown

and will depend

on future developments,

which are highly

uncertain and outside

developments include

supply chain disruptions, decreased demand for our products and services or those of our borrowers, which could increase

rising inflation,

qualified personnel

labor shortages,

talent attrition,

employee illness, quarantine,

willingness to return

to work, face-coverings

and other safety

requirements, or travel

restrictions, and the actions taken

by governments, businesses and individuals

to contain the impact of

COVID-19, as well

disproportionately

pandemic or recession in the U.S.

economy or the world

economy in general.

geographies in which

our customers operate.

ongoing and dynamic

nature, it is

predict the full

USCB Financial Holdings, Inc.

of the continuing

COVID-19 pandemic

on the business

of the Company,

its customers, employees

and third-party

developments,

Additionally,

responses of various governmental and non-governmental authorities

and consumers to the on-going pandemic may have

material long-term effects on

USCB Financial Holdings and our subsidiary

Century Bank and its customers

difficult to quantify in the near-term or long-term.

Inflationary pressures and rising prices may affect

our results of operations and financial condition.

businesses may be

impacted more during

periods of high

inflation, as they are

not able to leverage

economics of scale

mitigate cost pressures compared

to larger businesses.

Consequently,

the ability of our business

customers to repay their

loans may deteriorate, and in some cases this deterioration may occur quickly, which would adversely impact our results of

operations and financial

a prolonged period

of inflation could

to increase, which could adversely affect our results

Since 2021, there have been market indicators of a pronounced rise in inflation and the Federal Reserve raised certain

benchmark interest rates 11 times in

2022 and 2023 in

an effort to combat

Although the rate of

inflation moderated

in the fourth

quarter of 2023,

at levels not seen

for more than

inflation increases and

market interest

investment securities,

particularly those

maturities, decreases,

although this

pronounced for floating-rate

inflation generally increases

goods and services

we use in our business operations, such as electricity and other utilities, which increases our noninterest expenses.

prolonged period of inflation could cause wages and other of our costs to increase, which could adversely affect our results

of operations and financial condition.

banking industry causing disruptive deposit outflows

and other destabilizing results.

In March 2023, certain specialized banking institutions with elevated concentrations of uninsured deposits experienced

large deposit outflows,

resulting in the

institutions being placed

into FDIC receiverships.

In the aftermath,

there has been

deposit outflows

Furthermore, our customers are also

affected by inflation and the

rising costs of goods

their households

and businesses,

negative impact

addition, SMBs

impacted more

during periods

inflation, as

Consequently,

deterioration

adversely impact our results of operations and financial condition.

banking industry causing disruptive deposit outflows and other

destabilizing results.

Bank maintains

a well-diversified

deposit base.

In March 2023, certain specialized banking institutions with elevated concentrations of uninsured deposits experienced

receiverships.

deposit outflows and other destabilizing results.

While the Company does not believe that the

circumstances of these bank

failures, including, in

several cases, the

elevated concentrations of uninsured

deposits, are necessarily indicators

issues for concern

with all other

banks or with

the banking system itself,

the failures are

likely to continue

effect on customer

confidence and the

availability of funding

and liquidity,

as well as possibly

lead to increased regulatory

requirements and costs

and negative reputational

ramifications for

institutions in the

banking industry,

including, possibly,

the Company and its depository subsidiary, U.S.

Century Bank.

We will continue to closely monitor the ongoing events

well-diversified

depositors only

total portfolio.

our total portfolio.

As of December

are estimated

Our public funds

of total deposits and

are partially collateralized.

The estimated average account

$95 thousand.

addition, the Bank

was qualified

“well capitalized” institution

2022 and 2021.

are 14% of total

deposits and are partially

collateralized.

The estimated

average account size

December 31, 2023 and 2022.

Insufficient liquidity could

impair our ability to

fund operations and jeopardize

our financial condition,

of operations, growth and prospects.

Effective liquidity management is essential for the operation of our business.

have implemented strategies

to accommodate

as unanticipated,

(including changes

in assets, liabilities, and

off-balance sheet commitments under various

economic conditions), an inability

adverse effect

amounts adequate to

activities could

by factors that affect us specifically or the financial services

industry in general.

Factors that could detrimentally impact

access to liquidity sources include a decrease in the level of our business activity due to a market disruption, a decrease in

the borrowing capacity assigned to

our pledged assets by our

secured creditors, competition from other

financial institutions

which could drive up the

costs of deposits or adverse

regulatory action against us.

Deterioration in

economic conditions and

confidence in financial

institutions may increase

funding and limit

our access to

sources of liquidity,

including, but not

limited to, inter-bank

borrowings and borrowings

from the Federal

Home Loan Bank

of Atlanta, or

the FHLB, and

the Federal Reserve

Bank of Atlanta.

Our ability to

acquire deposits

could also be

severe disruption

financial markets

industry generally

of conditions

organizations

international

adversely impact our ability to originate loans, invest in securities, meet our expenses

or fulfill obligations such as repaying

USCB Financial Holdings, Inc.

our borrowings or

meeting deposit withdrawal demands,

could, in turn,

have an adverse

effect on our

financial condition, and results of operations.

political factors

25 unchanged sentences

financing to,

in certain regions

Moreover, actions by Russia, and any

3 unchanged sentences

on regional and global

financial markets and economic conditions.

To the extent changes in the global

political environment,

including Russia's

the escalating

financial markets and economic

To the extent changes in the

global political environment,

including the

continuing war

continued heightened

tensions between

UK, have a negative impact on

us or on the markets

in which we operate, our business,

results of operations and financial

condition could be materially and adversely impacted.

USCB Financial Holdings, Inc.

as the conflict

in Gaza, have

a negative impact

on the markets

business, results of operations and financial condition could be

materially and adversely impacted.

Our lending business is subject to credit risk, which

27 unchanged sentences

industry conditions,

individual borrowers,

risks inherent

with individual

borrowers, including

the risk that a borrower may not provide

6 unchanged sentences

without fulfilling their loan obligations,

with little recourse

leaving us with

little recourse

to them personally,

relating to the

21 unchanged sentences

may result in loan

defaults, foreclosures and additional

charge-offs and may necessitate

defaults, foreclosures and additional charge-offs and

may necessitate

that we significantly increase our allowance for credit losses, each of which could adversely affect our net income.

to effectively

loan portfolio

portfolio could

adverse effect on our business, financial condition

and results of operations.

discontinuation

problems and result in market disruption.

LIBOR was used as a reference rate for certain of the Corporation’s adjustable-rate loans and bonds.

In 2017, the U.K.

Financial Conduct

Authority announced

that after 2021

longer compel banks

to submit the

administrator

extend the retirement

date of certain offered

rates whereby the publication

of the one week

and two month LIBOR

rates will cease after December 31, 2021;

but, the publication of

the remaining LIBOR offered rates will continue until June

entering into new

contracts that use

reference rate after

December 31, 2021

would create safety

and soundness

risks and that

they will examine

bank practices accordingly.

Therefore, the

agencies encouraged banks

to cease entering

into new contracts that use LIBOR as a reference rate

as soon as practicable and in any event by December

Regulators, industry groups

and certain communities

(e.g., the Alternative

Reference Rates Committee)

alternatives for certain LIBOR rates (e.g.,

the Secured Overnight Financing Rate (“SOFR”) as the

recommended alternative

Dollar LIBOR), and proposed implementations of the recommended alternatives in floating rate instruments.

time, while it appears that

these recommendations and proposals

have been broadly accepted, it

is not possible to predict

will continue

implementation

financial instruments.

The uncertainty

surrounding potential

including the

alternative reference

the implementation of

LIBOR reform proposals

may result in

increased compliance and

Certain of our financial products are

tied to LIBOR.

Inconsistent approaches to

a transition from LIBOR to

an alternative

different market

participants and

for different

financial products

market disruption

and operational

problems, which

could adversely

us, including

increased interest

and associated

including, but not limited to, creating the possibility of

disagreements with counterparties.

which regulates

announced that

the publication

be guaranteed

In December 2020, the

administrator of LIBOR announced its intention to

(i) cease the publication of the

week and two-month

after December 31,

2021, and (ii)

cease the publication

tenors of U.S.

dollar LIBOR (one, three, six and 12 month LIBOR) after

June 30, 2023.

There are ongoing efforts to establish an alternative

reference rate.

The Federal Reserve Board, in conjunction with

institutions,

replacing LIBOR with SOFR, a new index calculated

by short-term repurchase agreements backed by

Treasury securities.

The Bank adopted SOFR as its preferred benchmark as

an alternative to LIBOR for use in new contracts in 2023.

USCB Financial Holdings, Inc.

contracts to a new benchmark rate, the

substitution of SOFR for LIBOR may

have potentially significant economic impacts

on parties to affected

different from LIBOR

in that it is

a retrospective-looking secured

rate rather than

a forward-looking

unsecured rate.

Additionally,

preferred replacement

transition from LIBOR, may adversely affect the val

ue of LIBOR-based financial arrangements of the Company.

Natural disasters and severe weather events in Florida

17 unchanged sentences

and residences,

USCB Financial Holdings, Inc.

the value of property serving as collateral for our loans, force the relocation of residents, and

1 unchanged sentence

activity in the region.

cannot predict

weather events,

adverse weather

events, which

variety of factors that are beyond our control,

17 unchanged sentences

our financial performance.

Changes in the interest

rate environment may reduce

expected that we

will continue to realize

from the differential or "spread" between the interest earned on loans, securities

and other interest-earning assets, and the

interest paid on deposits, borrowings

and other interest-bearing

Net interest spreads

are affected, in part,

characteristics

interest-earning

interest-bearing

Changes in the

interest rate environment

may reduce our

expected that our

primary source of

continue to be from

the differential or

"spread" between the

interest earned on

loans, securities and

other interest-earning

assets, and the interest paid on

deposits, borrowings and other interest-bearing liabilities.

interest spreads are affected,

in part, by the

difference between the maturities and repricing characteristics of

interest-earning assets and interest-bearing

interest rates

generally affect

funding sources

or completely

determinations with respect to interest rates.

It is currently expected that during 2023,

the Federal Open Market Committee of the Federal

Reserve (the “FOMC”) will

increase interest rates

to reduce the

inflation to the

extent necessary

inflation to the

rate that the

general economic

conditions, and

federal economic

fiscal policies,

and in particular,

policy determinations with respect to interest rates.

“FOMC”) increased

benchmark interest rates to reduce the rate of inflation to the extent

necessary to reduce inflation to the rate that the FOMC

believes is appropriate.

1 unchanged sentence

500 basis points.

increases were expressly

made in response

to inflationary pressures,

which are currently

expected to continue.

there can be no assurances as to any future FOMC action.

While an increase

in interest rates

may increase our

loan yield, it

may adversely

affect the ability

of certain borrowers

increases were expressly made in response to inflationary pressures.

Recently the FOMC has paused increases in certain

benchmark interest rates and may consider decreases in such

benchmark rates at some point during 2024.

However, there

assurances as to

any future FOMC

action, including whether

the federal funds

rate or implements

further increases.

While an increase in

interest rates may increase

our weighted average

loan yield, it may

adversely affect the

certain borrowers

with variable rate

1 unchanged sentence

interest and principal

Following an increase

in interest rates,

ability to maintain a positive net interest spread is

dependent on our ability to increase our loan offering rates, replace loans

that mature and

that prepay before

maturity with new

originations at higher

rates, minimize increases

rates, and maintain an acceptable

level and composition of

We cannot provide

assurances that we will

Additionally,

interest rates, our

ability to maintain

a positive net

interest spread is

dependent on our ability

to increase our

loan offering

rates, replace

before maturity

originations at

higher rates,

rates, and maintain

an acceptable level

and composition of

provide assurances

the increases

deposit rates

while maintaining

noninterest-bearing deposits as customers may seek

higher-yielding products when interest rates increase.

that we will be

able to increase

our loan offering

rates and continue

to originate loans

due to the competitive

which we operate.

Additionally, we cannot provide

assurances that we can minimize

the increases in our

deposit rates while

interest-bearing deposits such that

our weighted average cost

of deposits increased from

0.62% for 2022

noninterest-bearing

customers may seek higher-yielding products due to the

increased interest rates being paid on deposits currently.

quality, loan origination

1 unchanged sentence

and overall profitability.

adverse effect on our business, financial condition

and results of operations

debt ceiling and budget deficit

concerns have increased the

possibility of additional credit-rating

downgrades and

economic slowdowns, or a recession in

the United States.

Although U.S.

lawmakers passed legislation to

raise the federal

debt ceiling on multiple occasions, including the most recent increase in December 2021, ratings agencies have lowered or

threatened to lower the long-term sovereign

credit rating on the United

The impact of this

or any further downgrades

government’s sovereign credit rating or its

perceived creditworthiness could adversely affect the U.S.

financial markets and economic conditions.

Absent further

quantitative easing by the Federal Reserve,

these developments

could cause interest rates

and borrowing costs to rise,

which may negatively impact

our ability to access

the debt markets

on favorable terms.

addition, disagreement over

the federal budget has

USCB Financial Holdings, Inc.

A failure or the perceived

risk of a failure to raise

the statutory debt limit

in the future

material adverse effect on our business, financial

condition and results of operations

credit-rating

2023, ratings agencies have lowered or threatened to lower the long-term sovereign credit rating on the United States.

impact of this or any further

downgrades to the U.S.

sovereign credit rating or its

perceived creditworthiness

could adversely affect the U.S.

and global financial markets and economic conditions.

Absent further quantitative easing by

interest rates

and borrowing

may negatively

favorable terms.

disagreement over

caused the U.S.

federal government to shut

business, financial condition and results of operations.

federal government to shut down for periods of time.

Continued adverse

political and economic conditions

could have a material adverse effect on our business,

financial condition and results of operations.

Our allowance for credit losses may not be sufficient

5 unchanged sentences

diversification

USCB Financial Holdings, Inc.

experience, identified credit

7 unchanged sentences

identification

deterioration

or deterioration

increase our allowance for

19 unchanged sentences

provisions for credit losses to restore

the adequacy of our allowance for credit

the adequacy of our allowance for

credit losses.

Finally, the measure of our allowance

3 unchanged sentences

Board, or FASB, issued a new credit

impairment model, the Current Expected Credit Loss, or

CECL model, which became

impairment model, the Current Expected Credit Loss,

or CECL model, which became

losses over the lifetime of the loan at origination, as opposed to reserving for incurred or probable

2 unchanged sentences

model, expected credit deterioration

would be reflected in the income

statement in the period

deterioration

improvement reflected

expectation changes.

will be reflected in the

income statement in the

origination or acquisition of a loan,

with changes in expected credit losses

due to further credit deterioration or

the expectation

implementation of

institutions,

implementation of CECL.

Moreover, the

CECL model may create

more volatility in our

level of allowance for

financial institutions, like us, to

increase our allowances for

credit losses from levels in place

prior to the implementation of

As a result of the initial implementation of CECL,

we incurred as of January 1, 2023 a $1.1

million cumulative effect

of the adoption

the CECL model

may create more volatility

of allowance for

credit losses.

2 unchanged sentences

credit losses

reason, such increase

could adversely

increase could

affect our business, prospects, cash flow,

4 unchanged sentences

generally have

loan balances

are typically

1 unchanged sentence

property securing the loan.

commercial business loans are primarily

made to small business

commercial business loans are primarily made

to small business

and middle market customers.

2 unchanged sentences

generated, or expected

to be generated, by the property securing the loan

and/or by the cash flow generated by the business borrower and

to be generated, by the property securing the loan and/or

by the cash flow generated by the business borrower and

adversely affected by changes in the economy or

3 unchanged sentences

to liquidate the collateral securing

these loans at times when there

may be significant fluctuation of

commercial real estate

these loans at times when

there may be significant fluctuation

of commercial real estate

values or to the

7 unchanged sentences

profitability and

business, financial

condition, and

our business,

financial condition,

Commercial construction loans generally

have a higher risk

of loss due to the assumptions

used to estimate the

have a higher risk of

loss due to the assumptions

used to estimate the value

at completion

1 unchanged sentence

to accurately

USCB Financial Holdings, Inc.

funds required

6 unchanged sentences

completed property

we are forced

project prior

to completion,

are forced to

required to fund additional amounts to complete a project,

5 unchanged sentences

condition and results of operations.

The imposition

bank regulators

on commercial

lending activities

The imposition of

further limits by the

bank regulators on commercial

real estate lending activities

could curtail

growth and adversely affect our earnings.

concentrations

Under this guidance, a financial

institution that, like us, is actively

involved in commercial real estate lending should

concentrations.

our growth and adversely affect our earnings.

The FDIC, the Federal Reserve

and the Office of

the Comptroller of the

Currency have promulgated joint

sound risk management practices for financial institutions with concentrations in commercial real estate lending.

lending should

assessment to identify

concentrations.

lending provides that a bank’s commercial real estate lending exposure

could receive increased supervisory scrutiny where

owner-occupied

nonowner-occupied investor

real estate, and

construction and

represent 300%

an institution’s

risk-based capital, and the outstanding

balance of the commercial real estate

loan portfolio has increased by 50%

commercial investor

guidance on concentrations

in commercial real

estate lending provides

that a bank’s commercial real estate lending exposure could

receive increased supervisory scrutiny where total commercial

loans, including

USCB Financial Holdings, Inc.

secured by apartment buildings,

loans secured

by multi-family

properties, owner-occupied

and nonowner-occupied

investor real estate, and

construction and land loans, represent 300%

or more of an

institution’s total risk-based capital, and

the outstanding balance of the commercial real estate loan portfolio has increased by

50% or more during the preceding 36

buildings, commercial real estate, and construction

and land loans represented 384% of the Bank’s

total risk-based capital

and the growth in the commercial real estate portfolio exceeded 50% over

the preceding 36 months.

The particular focus of

the guidance is on exposure to commercial

real estate loans that are dependent

on the cash flow from the real estate

as collateral and that

are likely to be

at greater risk

to conditions in the

commercial real estate

and construction and land

loans represented 390% of

total risk-based capital and the growth in the

commercial real estate portfolio exceeded 50% over the preceding 36

The particular

commercial real

collateral and

to conditions

market (as opposed to real estate collateral held as a secondary source of repayment or as an abundance of caution).

purpose of the guidance is

to guide institutions in developing

risk management practices and

capital levels commensurate

market (as opposed

estate collateral held as a secondary source of repayment

or as an abundance of caution).

of the guidance is

to guide institutions in developing risk management practices and capital

levels commensurate with the level and nature of

concentrations.

Management has

established an

established a

commercial real

estate lending

monitor specific exposures

and limits by

types within the

commercial real estate

portfolio and

takes appropriate

actions, as necessary.

While we believe we have implemented policies and procedures with respect to our commercial real

estate loan portfolio

consistent with

this guidance,

the FDIC, U.S.

Century Bank’s

primary federal

exposures and limits by

types within the commercial

real estate portfolio and

takes appropriate actions, as necessary.

implemented policies and

procedures with

our commercial

loan portfolio

guidance, the

Bank’s primary

federal regulator,

could require

interpretation

additional costs to us.

In addition, If the FDIC were

to impose restrictions on the amount of commercial real estate loans we

can hold in our portfolio, our earnings would be adversely

implement additional

procedures pursuant to their interpretation

of the guidance that may result

in additional costs to us.

were to impose restrictions on the amount

of commercial real estate loans we can

hold in our portfolio, our earnings would

be adversely affected.

a participant

21 unchanged sentences

in the secondary market.

sales have resulted in

have resulted in

both premium income for us

at the time of sale

and created a stream of

future servicing income.

at the time of

sale and created a stream

of future servicing income.

can be no assurance

that we will be able to continue originating these loans, that a secondary market for these loans will continue to exist or that

we will continue to realize

premiums upon the sale

of the guaranteed portion of

premiums upon the sale of

the guaranteed portion of

the guaranteed

12 unchanged sentences

and procedures applicable to SBA loans

could adversely affect our

could adversely affect our ability

operate profitably.

7 unchanged sentences

the amount of SBA 7(a)

loan guarantees in any given

If the federal government were to reduce the amount of SBA loan guarantees, such reduction could

adversely impact

loan guarantees in any given fiscal

USCB Financial Holdings, Inc.

If the federal government were to reduce the amount of SBA loan guarantees, such reduction

could adversely impact

our SBA lending

21 unchanged sentences

to significant

notwithstanding that a portion of the loan

was guaranteed by the SBA, which could adversely

notwithstanding that a portion of the loan was

guaranteed by the SBA, which could adversely

affect our business, financial

condition and results of

While we follow

the SBA's underwriting

follow the SBA's underwriting

guidelines, our ability to

1 unchanged sentence

knowledge and diligence of our employees

and the effectiveness of

controls we have established.

employees do not

and the effectiveness of controls

we have established.

If our employees

failures, the

2 unchanged sentences

obligations and

USCB Financial Holdings, Inc.

Global banking is an important part of our business, which

33 unchanged sentences

complying with

Act of 1970, as amended, or BSA, and other anti-money laundering, or AML, statutes and regulations.

Our failure to strictly

adhere to the terms and

requirements of our OFAC

license or our failure

to adequately manage our

BSA/AML compliance

our correspondent

international

in regulatory or

other actions

which could significantly

increase our compliance

and materially and adversely affect our results of

as amended, or BSA,

and other anti-money laundering,

or AML, statutes

and regulations as

enacted Corporate

adhere to the

terms and requirements

correspondent

foreign financial institutions and international private banking could result

in regulatory or other actions being taken against

us, which could significantly increase our compliance costs

and materially and adversely affect our results

of operations.

We may not recover all amounts that are contractually

12 unchanged sentences

Many borrowers have been negatively impacted by

the COVID-19 pandemic and related

economic consequences, and may continue

to be similarly or more severely

in the future.

customers' actual operating results may be

worse than our underwriting contemplated when

we originated

the loans, and in these

circumstances, we could incur

substantial impairment or

loss of the value on

fail to identify problems because our customer did not report them in

a timely manner or, even if the customer did report the

problem, we may fail to address it quickly enough or at all, or some loans, due

to market circumstances, may not be able to

be fully rehabilitated.

Even if customers

provide us with

full and accurate

disclosure of

all material information

their businesses, we may misinterpret or incorrectly analyze

the ongoing COVID-19 pandemic and

related economic consequences, and

may continue to be similarly or

more severely

affected in the future.

Our customers' actual operating

results may be worse than

our underwriting contemplated

originated the loans, and in these circumstances, we could incur substantial impairment or loss of

the value on these loans.

We may fail to identify problems

because our customer did not

report them in a timely manner

or, even if the

report the problem, we may fail to address it quickly enough or at all, or some loans, due to market circumstances, may not

fully rehabilitated.

customers provide

accurate disclosure

material information

concerning their businesses,

we may misinterpret

or incorrectly analyze

this information.

Mistakes may cause us to

make loans that we

otherwise would not have made or to fund

advances that we otherwise would not

have funded, either of which could result

or necessitate

significantly

allowance for

loans that we otherwise

would not have made or

to fund advances that we otherwise

would not have funded, either

could result in losses

on loans, or necessitate

that we significantly

increase our allowance

lease losses.

result, we could

losses and have

non-performing loans,

material adverse

and results of operations and financial condition, to the extent

the losses exceed our allowance for loan and lease losses.

lien on specified

collateral of the

borrower and we

may not obtain

or properly perfect

which could have

a material adverse

effect on our

earnings and results of operations and financial condition, to the extent the losses exceed our allowance for loan and lease

loans are secured

on specified collateral

of the borrower

not obtain or

properly perfect

our liens or the value of the collateral securing any particular loan may not be sufficient to protect us from suffering a partial

1 unchanged sentence

the collateral.

associations,

Associations,

primarily secured by and rely

upon the cash flow received

by the Associations from

payments received from their property

USCB Financial Holdings, Inc.

respect to loans that we originate for condominium or homeowners'

associations, these loans are primarily secured by and

rely upon the

cash flow received

by the Associations

from payments received

from their property

owners, as well

These Associations

rely upon payments

received from

their property owners

payments received

property owners

loan collateral.

non-performing

made to Associations

upon the Association

having sufficient

for repayment

In such events, we could suffer

loan losses, which could have a material adverse effect

on our net earnings,

allowance for loan and lease losses, financial condition,

and results of operations.

on non-performing

to Associations

dependent upon the

Association having sufficient cash on

hand for repayment of

the loan and/or having

the ability to impose

assessments on its property owners, some of whom may not have the ability to pay such assessments.

In such events, we

losses, financial condition, and results of operations.

Non-performing

2 unchanged sentences

affect our net

income in various

interest income on

various ways.

record interest income

on nonaccrual

loans or other

14 unchanged sentences

our regulators

appropriate for

believe is appropriate

The resolution

9 unchanged sentences

we experience increases

USCB Financial Holdings, Inc.

non-performing

6 unchanged sentences

own the underlying

estate, subjecting us to the costs

and potential risks associated with the

ownership of real property,

protection initiatives

or changes in

state or federal

law may substantially

raise the cost

of foreclosure

environmental

substantially raise the cost of foreclosure or prevent

us from foreclosing at all.

6 unchanged sentences

to, general or

local economic

conditions, environmental

cleanup liabilities,

local economic conditions,

environmental cleanup

various assessments

relating to the

the property,

the ownership

of the property,

interest rates, real

3 unchanged sentences

regulatory rules,

inability to manage

and natural disasters.

Our inability

associated with

6 unchanged sentences

or federal law may

substantially increase the

substantially increase the time

expenses associated

13 unchanged sentences

that significantly raise

residential foreclosures

or raise outright barriers,

they could have

the cost of residential

foreclosures or raise

outright barriers, they

an adverse effect on our business, financial condition,

8 unchanged sentences

operating our business.

During the ordinary course of

business, we may foreclose on and take

title to properties securing defaulted loans.

During the ordinary course of business,

we may foreclose on and take title to

properties securing defaulted loans.

hazardous or toxic

20 unchanged sentences

of a contaminated site, we may be

subject to common law claims

by third parties based

subject to common law claims by

third parties based

on damages and

4 unchanged sentences

and results of operations could be adversely affecte

USCB Financial Holdings, Inc.

fraud and data processing system failures and errors.

7 unchanged sentences

or unauthorized activities on behalf of our customers or improper use of confidential information.

It is not always possible to

always possible to

prevent employee

2 unchanged sentences

in all cases.

Employee errors could also subject us to financial

claims for negligence.

Employee errors could also subject us

to financial claims for negligence.

implemented a

14 unchanged sentences

financial condition and results of operations.

systems, as well

as the various

participants involved

in these systems,

many of which

have no direct

relationship with us.

or operational

Annual Report

no knowledge or

that customer

sensitive information

was compromised

third parties

system vulnerabilities,

but management

continues to monitor developments and vendor communications.

When we originate loans, we rely

13 unchanged sentences

than expected,

underwriting standards.

misrepresentation is

USCB Financial Holdings, Inc.

general underwriting

a misrepresentation

the applicant, the borrower,

5 unchanged sentences

misrepresentation is typically

unsellable or subject

to repurchase if

unsellable or subject to

repurchase if it

sold prior to detection of the

1 unchanged sentence

The sources of

the misrepresentations are often difficult

to locate, and it is

the misrepresentations are often

difficult to locate, and

often difficult

2 unchanged sentences

financial condition and results of operations.

We are subject to liquidity risk, which could adversely

affect our financial condition and results

of operations.

Effective liquidity management is essential for the operation of our business.

have implemented strategies

to accommodate

as unanticipated,

(including changes in assets,

liabilities, and off-balance sheet

commitments under various economic conditions),

adverse effect on

our liquidity.

funding sources in

amounts adequate to

activities could

by factors that affect us specifically or the financial services

industry in general.

Factors that could detrimentally impact

access to liquidity sources include a decrease in the level of our business activity due to a market disruption, a decrease in

the borrowing capacity assigned to

our pledged assets by

our secured creditors, competition from other

financial institutions

which could drive up the

costs of deposits or adverse

regulatory action against us.

Deterioration in

economic conditions and

confidence in financial

institutions may increase

funding and limit

our access to

sources of liquidity,

volume of transactions

transactions.

loss resulting from

our operations,

including but not

limited to, inter-bank

borrowings and borrowings

from the Federal

Home Loan Bank

of Atlanta, or

the FHLB, and

the Federal Reserve

deposits or borrow

could also be

impaired by factors

severe disruption

financial markets

or negative views

the financial

organizations

international

liquidity could

adversely impact our ability to originate loans, invest in securities, meet our expenses

or fulfill obligations such as repaying

our borrowings or

meeting deposit withdrawal demands,

could, in turn,

have an adverse

effect on our

financial condition, and results of operations.

limited to, the

risk of fraud

by employees or

persons outside

the execution

of unauthorized

transactions by

employees, errors

to transaction

processing and technology, breaches of

control systems and

compliance requirements.

not be available

where available, such

exceed insurance

compliance with applicable regulatory standards,

adverse business decisions or their

implementation, or customer attrition

potential adverse publicity.

breakdown in our

internal control systems,

improper operation of

or improper employee actions, we could suffer financial

loss, face regulatory action, and/or suffer damage to

our reputation.

We have several

15 unchanged sentences

our business, financial condition and results of operations.

The value of our securities in our investment portfolio

may decline in the future.

conditions, including

issuer of particular securities in our investments portfolio

or any given market segment or industry in

which we are invested.

Any of these factors, among others, could cause OTTI and realized and/or unrealized losses in future periods and declines

comprehensive

judgments about the

future financial performance

and liquidity of

any collateral underlying

the security and

intent and ability to hold the security for a sufficient period of time to allow for any anticipated recovery in fair value, in order

to assess the probability of receiving

all contractual principal and interest

payments on the security.

Our failure to correctly

and timely assess

any impairments or

losses with respect

to our securities

could have an

adverse effect

on our business,

financial condition and results of operations.

Our securities portfolio performance in difficult market conditions could have adverse effects on

our results of

Unrealized losses on

investment securities result from

changes in credit

spreads and liquidity

issues in the

our securities,

into consideration

USCB Financial Holdings, Inc.

earnings, current

analysts’ evaluations,

investments until

other factors.

Adverse developments with respect to one or more of

the foregoing factors may require us to deem particular

securities to be impaired, with the credit-related portion of

the reduction in the value recognized as a

charge to our earnings

through an allowance.

Subsequent valuations,

in light of factors prevailing at that

time, may result in significant changes

the values of these securities in future periods.

Any of these factors could require us to

recognize further impairments in the

value of our securities portfolio, which may have an adverse

effect on our results of operations in future periods.

effectively execute

17 unchanged sentences

or restrict the

our operations.

growth of our

Further, we may be unable to attract

6 unchanged sentences

such growth may

USCB Financial Holdings, Inc.

not offer the

same levels of

potential profitability,

not offer the same

levels of potential profitability,

and we may not

2 unchanged sentences

quality in the

our inability to

maintain growth

effectively manage

our inability

to effectively

manage growth

an adverse effect on our business, financial condition

2 unchanged sentences

or services may subject us to additional risk.

From time to time,

we may implement new

lines of business or

offer new products

and product enhancements

From time to time, we

may implement new lines

of business or offer

new products and product

enhancements as well

services within

8 unchanged sentences

We may underestimate the appropriate level

of resources or expertise necessary

of resources or expertise

enhancements or services, and price

22 unchanged sentences

existing shareholders.

We believe that

we have sufficient capital

We believe that we

have sufficient capital

to meet our capital

14 unchanged sentences

our control, and our financial performance.

we cannot provide assurance that such capital

will be available on

we cannot provide assurance that such capital will

be available on

terms acceptable to us or at all.

6 unchanged sentences

raise capital and

compete with those

institutions for investors.

would then have

to compete with

those institutions for

Any inability

13 unchanged sentences

and could be dilutive to both tangible book value and our

USCB Financial Holdings, Inc.

Federal law requires that a holding company act as a source of financial and managerial strength to its subsidiary bank

such subsidiary

doctrine, the

Federal Reserve

injection may be required

at times when the

holding company may

not have the resources

to provide it and

therefore may

be required to attempt to

borrow the funds or raise

Thus, any borrowing that must

be done by the Company

capital injection becomes

more difficult and

expensive and

effect on our

business, financial

condition and results of operations.

Moreover, it is possible that we will be

unable to borrow funds or

otherwise raise capital

raise capital

increased regulatory

supervision and

imposition of

and business.

These restrictions

establishment

adverse effect on our financial condition, results

of operations and our share price.

These restrictions may also

result in increases in operating

expenses and reductions in revenues

that could have

a material adverse effect on our financial condition,

results of operations and our share price.

acquisitions,

10 unchanged sentences

for any opportunistic

acquisition we

were to consider,

acquisition we were

face significant

2 unchanged sentences

successful in identifying or completing any future acquisitions.

USCB Financial Holdings, Inc.

Mergers and acquisitions involve numerous risks,

any of which could harm our business, including:

Mergers and acquisitions involve numerous risks, any

of which could harm our business, including:

the possibility that expected benefits

13 unchanged sentences

evaluating potential acquisitions

and merger partners

and negotiating potential transactions, resulting in management’s attention being diverted from the operation of our

1 unchanged sentence

difficulties in supporting and transitioning customers

of the target and disruption of our ongoing banking business;

resources that

we devote may

exceed the value

we realize, or

of the target and disruption of our ongoing banking

resources that we

devote may exceed

realize, or the

value we could

realized if we had allocated the purchase consideration

or other resources to another opportunity;

entering new markets or areas in which we have limited

or no experience;

entering new markets or areas in which we have limited or

no experience;

the possibility that our culture is disrupted as a result of

an acquisition;

potential loss of key personnel and customers from

either our business or the target’s business;

potential loss of key personnel and customers from either

our business or the target’s business;

assumption of unanticipated problems, claims or other liabilities

9 unchanged sentences

the possibility that any such issues associated with

institution, of which we

of the acquisition,

could adversely impact the

institution, of which

acquisition, could adversely impact

entity after completion of the acquisition;

3 unchanged sentences

acquisition costs.

Our acquisition

activities could

a substantial

liquid assets,

shareholders’

could negatively

market price of

common stock.

Any acquisition activities we engage in could require us to use a substantial amount of cash, other liquid assets, and/or

we finance acquisitions by issuing equity securities,

our existing shareholders’ ownership may be

Additionally,

if the goodwill

potential future

were determined

earnings, which

could materially

and adversely

of operations

impairment was

connection with our potential future acquisitions were determined to be impaired, then we would be required to recognize a

charge against our earnings, which

could materially and adversely affect our

results of operations during the

period in which

the impairment was recognized.

may also involve the payment

of a premium over book

and market values and,

USCB Financial Holdings, Inc.

therefore, some

5 unchanged sentences

any such merger or

acquisition, and we may

incur costs in

otherwise adequately address and

manage the risks associated with

acquisition, and we

may incur costs

otherwise adequately address and manage

the risks associated with

such transactions could have

8 unchanged sentences

Our future success will, to some extent, depend on the continued service of our directors, executive officers and senior

Anderson, our Chief Financial Officer,

and Benigno Pazos, our Chief Credit Officer,

is important to our continuing success.

Anderson, our Chief Financial

and William Turner,

our Chief Credit Officer,

is important to our continuing

management team,

12 unchanged sentences

and successful

our business.

retain qualified

intense competition

for qualified

senior management personnel, or the inability to recruit

10 unchanged sentences

equity awards,

which may reduce our earnings or adversely affect

our business, results of operations, financial condition or

USCB Financial Holdings, Inc.

which may reduce our earnings or adversely affect our

business, results of operations, financial condition or prospects.

Damage to our reputation could significantly harm

16 unchanged sentences

publicity regarding

of diversity,

our reputation,

and workplace

activities of our customers, other

27 unchanged sentences

of social media

every segment

virtually every

society facilitates

dissemination

14 unchanged sentences

including local

competitors offer the same banking services

that we offer and our

success depends on our ability to

adapt our products and

competitors offer the same banking services that

we offer and our success depends on

our ability to adapt our

requirements.

5 unchanged sentences

face competition

institutions, including without

institutions, including

without limitation,

intermediaries.

4 unchanged sentences

may be adversely affected.

If we are unable to attract and retain banking customers, we may

be unable to grow or maintain

If we are unable to attract and retain banking customers, we may be

unable to grow or maintain

USCB Financial Holdings, Inc.

of operations

1 unchanged sentence

condition may

we may not be able to compete successfully against current

Ultimately, we

may not be able to compete successfully against current

and future competitors.

8 unchanged sentences

processes may be

better than those we

currently use.

better than those

we currently use.

of technological change

5 unchanged sentences

ability to address

the needs of our

customers by using technology

to provide products and

services that will satisfy

our customers by using

technology to provide products

and services that

will satisfy customer

demands for convenience,

2 unchanged sentences

in our operations.

may not be able

new technology-driven

products and services

effectively or

be successful in

marketing these

be able to implement

new technology-driven products

and services effectively

or be successful

in marketing these

products and services

Failure to keep pace successfully with technological change affecting the financial services industry could harm

significant capital

order to remain

4 unchanged sentences

condition and results of operations.

technological

competitors to invest in technological improvements.

The financial

services industry is

undergoing rapid technological

changes with frequent

introductions of new

driven products and

The effective use

of technology increases efficiency

and enables financial institutions

serve customers and to reduce

Our future success

will depend, in part, upon

our ability to address the

clients by using technology to

provide products and services

that will satisfy client demands

for convenience, as well

create additional

efficiencies in our operations.

Many national vendors provide turn-key services to community banks, such

as internet banking and remote deposit capture that allow smaller banks to compete

with institutions that have substantially

greater resources

in technological

improvements.

to effectively

technology-driven products and services or be successful

in marketing these products and services to our customers.

interruption,

1 unchanged sentence

devote significant

maintain and regularly

systems and processes

that are designed

resources to maintain

and regularly update

our systems and

processes that are

confidentiality,

4 unchanged sentences

institutions,

sophisticated

systems or cause

other damage, including

through the introduction of

computer viruses or

malware, cyber-attacks and other

USCB Financial Holdings, Inc.

individuals and

phishing campaigns,

pretext calling,

malicious code

viruses and expect to

be subject to such

attacks in the future.

While we have

not experienced a material

cyber-incident or

security breach that has

been successful in compromising

our data or systems

to date, we can

never be certain that

our systems are entirely free from vulnerability to breaches

of security or other technological difficulties or

attempts to infiltrate the security of their websites or other systems, some involving sophisticated targeted

attacks intended

unauthorized access

to confidential

information, destroy

data, disrupt

service, sabotage

cause other damage, including through the introduction of

computer viruses or malware, cyber-attacks and other means.

although there

indication that we

have experienced a

material cyber-incident or

security breach

that has been successful in compromising our

data or systems to date, we can

never be certain that all of our

entirely free from vulnerability to breaches of security or

other technological difficulties or failures.

Despite efforts to

3 unchanged sentences

is possible that

we may not be

able to anticipate,

detect or recognize

threats to our

to implement effective

systems or to

implement effective

preventive measures

1 unchanged sentence

to breach our

security inside or outside our business, especially because the techniques used to attack our

systems change frequently or

security inside or outside our business, especially because the techniques used to attack our systems

change frequently or

cyber-attacks

individuals or groups who are associated

with external service providers or who are or

individuals or groups who are associated with

external service providers or who are or

may be involved in organized crime

6 unchanged sentences

that of our customers

other companies, our

to other companies,

our risks and exposures

to cybersecurity attacks have increased as

a result of the related increased

reliance on remote working (largely

of the COVID-19 pandemic)

and the increase in

digital operations.

risks and exposures

to cybersecurity

-19 pandemic,

increased reliance

working and increase in digital operations.

risks and exposures are expected to remain high

for the foreseeable future

are expected to

for the foreseeable

to the rapidly

evolving nature

1 unchanged sentence

the expanding

based product offerings grow and we expand internal

usage of web-based applications.

penetration or

technology, as our web

-based product offerings grow and we expand

internal usage of web-based applications.

circumvention

including those

our third-party

consequences,

1 unchanged sentence

confidential information,

and may result

in violations

result in violations

of applicable

USCB Financial Holdings, Inc.

laws, financial loss,

28 unchanged sentences

handle current or

higher volumes, failure of a vendor to provide services for any reason,

poor performance of services, failure to comply with

higher volumes, failure of a vendor to provide services for

any reason, poor performance of services, failure to comply

applicable laws

2 unchanged sentences

could adversely

ability to deliver

products and services

to our customers,

our reputation and

our ability to

conduct our business,

affect our ability

to deliver products

and services to

our customers, our

reputation and our

ability to conduct

our business,

adversely affect

8 unchanged sentences

an unavoidable

affected by increased

reliance on remote

work environments, market

volatility and other factors

that increase their risks

business disruption or

that may otherwise

affect their ability

to perform under

any agreements with

us or provide

essential services.

generally expected

environments,

other factors

that increase

disruption or

otherwise affect

their ability

terms of any agreements with us or provide essential services.

Our operations could be interrupted or

4 unchanged sentences

Reserve, FDIC,

Financial Regulation,

the FOFR, and other regulators expect financial institutions to be responsible for all aspects of their performance, including

aspects that they delegate

to third parties.

we will be responsible

for deficiencies in

our oversight and control

of our third party relationships

and in the performance

of the parties with

which we have these

relationships.

our regulators

conclude that

not exercised

adequate oversight

ongoing third party business

relationships or that such

third parties have not performed

other regulators

expect financial

be responsible

for deficiencies

oversight and

party relationships

performance of the parties with which

we have these relationships.

a result, if our regulators conclude that

exercised adequate oversight and control over our third party vendors or

other ongoing third party business relationships or

appropriately,

we could be subject

to remedial and/or enforcement

actions, including civil money penalties

or other administrative or judicial

penalties or fines

as well as requirements for customer remediation, any

of which could have a material

adverse effect our business, financial

condition or results of operations.

USCB Financial Holdings, Inc.

including civil

money penalties

administrative

as requirements

remediation, any of which could have a material adverse

effect our business, financial condition or results

of operations.

Litigation and regulatory actions,

1 unchanged sentence

us to significant fines,

In the normal course of business,

from time to time, we

In the normal course of

business, from time to time, we

have in the past and

2 unchanged sentences

legal actions

current and/or

prior business

connection with

actions could

claims for substantial compensatory

or punitive damages

or claims for

indeterminate amounts of

supervisory penalties

or criticism.

time to time,

be the subject

of subpoenas,

reviews, investigations and proceedings (both formal and informal) by governmental agencies

regarding our current and/or

tangential or otherwise and

even if the matters are

ultimately determined in our

also cause significant harm

our reputation and divert management attention away from

claims for substantial compensatory and/or

punitive damages or claims for indeterminate

amounts of damages.

attention, or similar types of

supervisory penalties or criticism.

from time to time, be

the subject of subpoenas,

investigations

regarding our

requirements resulting

expenses, diminished

our reputation.

Our involvement

such matters,

whether tangential

are ultimately

cause significant harm to our

reputation and divert management attention away from

the operation of our business.

settlement, consent

order or adverse

connection with

proceeding or

investigation by

government agencies

may result in

litigation, investigations or proceedings

as other litigants

and government agencies begin

independent reviews

result, the outcome of

legal and regulatory

actions could have

an adverse effect on

our business,

results of operations and results of operations.

any settlement, consent order or adverse judgment in connection with any formal or informal proceeding or investigation by

investigations

begin independent

and regulatory

actions could

adverse effect on our business, results of operations

and results of operations.

our directors may

6 unchanged sentences

become, affiliated.

Certain of our directors

Certain of our

directors are or may

become subject to fiduciary

8 unchanged sentences

To the extent

USCB Financial Holdings, Inc.

that any of our directors

9 unchanged sentences

should assume

directors become

opportunity that may

be suitable both

another entity to

which such person

directors become aware

of an opportunity

suitable both for

us and another

entity to which

such person has

fiduciary obligation

6 unchanged sentences

entity or entities

suitable for us, he or she may not present such opportunity to

suitable for us, he or she may not present such opportunity

Pursuant to an agreement between us and each of our Significant Investors

8 unchanged sentences

The directors

observers designated

Significant Investors

designated by

the Significant

Investors have

business activities

1 unchanged sentence

a corporate opportunity

to communicate or

such person shall

communicate or

present such corporate

3 unchanged sentences

indirectly, pursues or acquires such opportunity

for itself, directs such

to another person, or does not present such opportunity to

for itself, directs

such opportunity

to another person, or does not present such opportunity

Risks Related to Our Tax,

Accounting and Regulatory Compliance

Our ability to recognize

the benefits of

our deferred tax

assets is dependent

on future cash flows

income and may be materially impaired upon significant

changes in ownership of our common stock.

We recognize the expected future tax benefit

from deferred tax assets when it

is more likely than not

that the tax benefit

will be realized.

Otherwise, a valuation allowance is applied against deferred tax assets, reducing the value of such assets.

recoverability

We recognize the expected future tax

benefit from deferred tax assets when

it is more likely than

not that the tax benefit

the recoverability

requires management

to make significant

estimates related

income from operations and the application of existing tax laws in each jurisdiction.

The improved risk profile of the Bank is

a key component

determination of

to realize the

component used

in the determination

expected future

the extent that future taxable income differs

significantly from estimates as a result of

the interest rate environment and

significantly from estimates as a result

of the interest rate environment and

loan growth capabilities or other factors, our ability to realize

the net deferred tax assets could be negatively

USCB Financial Holdings, Inc.

Subject to certain exceptions, our Class A common stock is subject

14 unchanged sentences

significant future

equivalents, or

stock equivalents,

indirect ownership

8 unchanged sentences

of the Internal Revenue Code.

Future changes in tax law

or changes in ownership structure

could limit our ability to utilize

Future changes in tax law or

changes in ownership structure could

limit our ability to utilize

our recorded net deferred tax assets.

8 unchanged sentences

significant to presenting our financial

condition and results of operations.

condition and results of

Our critical accounting policies, which

in the section captioned

"Management's Discussion and

Analysis of Financial Condition

and Results of

Operations" in this

Annual Report

10-K, describe

those significant

preparation of

consolidated financial statements that we

consider critical because they

require judgments, assumptions and estimates that

materially affect

in the section captioned "Management's Discussion and Analysis of Financial Condition and Results

of Operations" in Item

7 of this Annual Report

on Form 10-K, describe

those significant accounting

policies and methods used

in the preparation

estimates that materially affect our consolidated financial statements and related disclosures.

As a result, if

future events or

regulatory views concerning such analyses differ significantly from the judgments, assumptions and estimates in

accounting policies,

or assumptions

our consolidated

or regulatory

views concerning such

analyses differ significantly from

the judgments, assumptions and

estimates in our

critical accounting

policies, those

assumptions could

material impact

consolidated financial

statements and

disclosures, in each

case resulting in

revise or restate

prior period financial

statements, cause

financial statements

USCB Financial Holdings, Inc.

damage to our

reputation and

adversely affect

our business,

prospects, cash

A common stock

and adversely affect

our business, prospects,

flow, liquidity,

financial condition and results of operations.

15 unchanged sentences

capital markets,

stock to decline and subject us to regulatory penalt

stock to decline and subject us to regulatory penalti

Our management is responsible for establishing

1 unchanged sentence

reporting and

for evaluating

financial statements for external purposes in accordance with GAAP.

12 unchanged sentences

our compliance with Section

of the Sarbanes-Oxley Act

beginning with this Annual

Report on Form 10-K,

which requires us to annually

furnish a report

by management on

the effectiveness

of our internal

control over financial

evaluating our internal

over financial

reporting, we

applicable deadline imposed upon

us for compliance with

the requirements of Section

404 of the Sarbanes-Oxley

identification of key financial reporting

risks, assessment of their potential impact

and linkage of those

risks to specific areas

and controls within our organization.

Sarbanes-Oxley Act, which

requires us to

annually furnish

management on the

effectiveness of our

weaknesses that we may not be able to remediate in time to meet the applicable deadline imposed upon us for compliance

with the requirements of Section 404 of the Sarbanes-Oxley Act.

We periodically review our formal policies, processes and

practices related to financial reporting

and to the identification of

key financial reporting risks, assess

their potential impact

and the linkage of those risks to specific areas and controls

within our organization.

If we fail to achieve and maintain the adequacy of

our internal controls, as such standards are modified, supplemented,

or amended from time

to time, we may not

or amended from time to

time, we may not

be able to ensure

5 unchanged sentences

and any remediation actions or the impact of the

our operations.

to adequately

the requirements

of Section 404

of the Sarbanes

adequately comply

with the requirements

Sarbanes-Oxley Act,

we may be subject to adverse regulatory consequences and

3 unchanged sentences

reliability of our financial statements.

In addition, we may be required to incur

we may be required to incur

costs in improving

1 unchanged sentence

hiring additional

action could negatively

business, financial condition, results of operations, and the price

of our Class A common stock may decline.

USCB Financial Holdings, Inc.

such action could

negatively affect

business, financial condition, results of operations, and the

price of our Class A common stock may decline.

While we remain an

5 unchanged sentences

attestation requirement

Oxley once we no longer qualify as an emerging growth company, we are currently engaged in a process to document

internal control

over financial

reporting, which

dedicate internal resources, potentially engage outside consultants

and adopt a detailed work

plan to assess and

financial reporting, continue

Oxley once we no

longer qualify as an

emerging growth company

or as a non-accelerated

smaller reporting company,

financial reporting,

In this regard, we will need to

dedicate internal resources, potentially engage

outside consultants and adopt a

improve control

appropriate, validate

through testing that controls are functioning

as documented and continue to refine

our reporting and improvement process

for internal control over financial reporting.

Despite our efforts, there is a risk that we will not be able to conclude, within the

prescribed time

internal control

over financial

Sarbanes-Oxley.

markets due to a loss of confidence in the reliability of

our financial statements.

processes as appropriate,

validate through testing

that controls are

functioning as documented

to refine our

reporting and improvement

internal control over

financial reporting.

conclude, within

the prescribed

reporting is effective as

required by Section 404

of Sarbanes-Oxley.

If we identify one

or more material weaknesses,

result in an adverse reaction in the financial markets due to a

loss of confidence in the reliability of our financial statements.

corporate governance,

5 unchanged sentences

highly regulated industry and

we are subject

to examination, supervision and

comprehensive regulation

we are subject to

examination, supervision and comprehensive

by various federal and state agencies,

7 unchanged sentences

shareholders.

customers, depositors, the Deposit Insurance

Fund, or DIF, and the overall financial health and

stability of the United States

customers, depositors, the Deposit Insurance Fund,

or DIF, and the overall financial health and

stability of the United

requirements,

5 unchanged sentences

lending activities,

require us to provide certain banking services broadly within the communities in which

we operate, determine the locations

require us to provide certain banking services broadly within the communities in which we operate,

determine the locations

of our branch

2 unchanged sentences

that may be more

restrictive and may

restrictive and may result

capitalization

USCB Financial Holdings, Inc.

impose additional operating costs.

Further, we must obtain approval from our regulators

before engaging in many activities,

Further, we must obtain approval from our

regulators before engaging in many activities,

assurance that any regulatory approvals we may require

12 unchanged sentences

Economic Growth, Regulatory Relief and Consumer

Protection Act, or the Regulatory Relief Act,

have significantly revised

Protection Act, or the Regulatory Relief

Act, have significantly revised

the laws and regulations under which we operate.

Such regulations and laws may be modified or repealed at any time, and

new legislation may be enacted that will affect

us and our subsidiaries.

new legislation may be enacted that will affect us and

our subsidiaries.

Our failure to comply with these laws and regulations, even if the failure follows good faith effort

8 unchanged sentences

or expensive or otherwise

adversely affect

our business, prospects, cash

adversely affect our

business, prospects, cash

flow, liquidity,

financial condition and results of operations.

Our participation in the SBA PPP loan program exposes us to risks related to noncompliance

with the PPP,

well as litigation

risk related to

our administration of

program, which

material adverse

impact on our business, financial condition, and results

of operations.

participating lender in

the PPP, a loan program administered

through the SBA,

that was created

to help eligible

businesses, organizations

and self-employed persons

fund their operational

costs during the

COVID-19 pandemic.

this program, the SBA guarantees 100% of the amounts

loaned under the PPP.

The PPP opened on April 3, 2020;

because of the short window between

the passing of the CARES Act and

regarding the

Subsequent rounds of

legislation and associated

agency guidance have

not provided needed

clarity and in

certain instances

inconsistencies

noncompliance with the PPP.

USCB Financial Holdings, Inc.

Additionally, since the launch of the PPP, several larger banks have been

subject to litigation regarding

the process and

nonpayment of

certain agents

who facilitated

applications.

risk of PPP-related litigation, from

both customers

and non-customers that approached us

regarding PPP loans, regarding

our process and procedures used in processing

applications for the PPP.

If any such litigation is filed against

us and is not

Regardless of outcome, litigation can be costly and distracting.

Any financial liability, litigation costs or reputational damage

PPP-related litigation

adverse impact

business, financial

condition and

PPP loans are fixed,

low interest rate loans

that are guaranteed by

the SBA and subject

to numerous other regulatory

requirements, and a borrower may apply to have all

or a portion of the loan forgiven.

borrowers fail to qualify for loan

forgiveness, we face

a heightened risk

of holding these loans

at unfavorable interest

rates for an extended

period of time.

While the PPP loans are guaranteed

by the SBA, various regulatory

requirements will apply to

our ability to seek

under the guarantees, and related procedures are currently subject

to uncertainty.

determination

borrower to receive a PPP

loan, which may or may

not be related to the

ambiguity in the laws, rules

and guidance regarding

the operations of the PPP.

a deficiency is identified, the SBA may deny its liability under the guaranty, reduce the amount

of the guaranty,

or, if it has already paid

under the guaranty,

seek recovery of any loss related to the deficiency from

noncompliance

9 unchanged sentences

laundering programs

file suspicious

currency transaction

5 unchanged sentences

Act, is authorized

significant civil

to impose significant

money penalties for

1 unchanged sentence

requirements and has engaged

in coordinated enforcement efforts with

the individual

in coordinated enforcement efforts

with the individual

Administration

1 unchanged sentence

Additionally,

South Florida

designated as

Intensity Financial

by FinCEN and a

“High Intensity Drug Trafficking Area,” or HIDTA, by the Office of

National Drug Control Policy.

South Florida has been designated as a “High Intensity Financial Crime Area” (“HIFCA”)

Intensity Drug

Area” (“HIDTA”)

National Drug

Control Policy.

program is intended to concentrate law enforcement efforts

to combat money laundering efforts in higher-risk

is also increased scrutiny of

compliance with the rules enforced by the

Office of Foreign Assets Control,

and state bank

regulators have for

many years focused

on compliance with

Act and anti-money

with regulations,

guidelines and

significant resources

anti-money laundering

especially due

regulatory focus

institutions located in South

Our business includes

supporting our customers, including foreign

financial institutions,

with respect to their international banking needs and our policies, procedures and systems have been designed to address

state anti-money

laundering compliance.

policies, procedures

deficient or the

prevent the recurrence

years, sanctions that

the regulators have

imposed on banks

that have not

is also increased scrutiny of compliance with

the rules enforced by OFAC.

Federal and state bank regulators have for many

regulations, guidelines and examination procedures in this area, we have

dedicated significant resources

to our anti-money

laundering program, especially

due to the regulatory

focus on financial

and other institutions

located in South

institutions,

international

our policies,

systems of the

financial institutions that

we may acquire

are deficient, we

would be subject

to liability,

including fines, and

regulatory actions that are

deemed necessary in order

to remediate such deficiencies

and prevent the recurrence

In recent years, sanctions that the regulators have

imposed on banks that have not complied with

all anti-money laundering

laundering and

1 unchanged sentence

reputational consequences

which could have a material adverse effect

on our business, financial condition and results of operations.

adverse effect on our business, financial condition

and results of operations.

requirements, which could adversely affect our

financial condition and operations.

In July 2013, the federal banking agencies published new regulatory capital rules based on

the international standards,

international

Banking Supervision.

based capital

for calculating

risk-weighted

11 unchanged sentences

is limited to common

equity (plus related surplus), retained

earnings, accumulated other comprehensive income and

equity (plus related surplus), retained earnings,

accumulated other comprehensive income and certain

noncumulative

USCB Financial Holdings, Inc.

preferred stock,

6 unchanged sentences

CET1 capital ratio of 7.0%

1 capital ratio of 8.5% or

a total capital ratio

1 capital ratio of 8.5%

a total capital

USCB Financial Holdings, Inc.

10.5% or more;

2 unchanged sentences

buffer consisting

of common equity Tier

addition to the

higher required capital

ratios and the

new deductions and

of common equity

to the higher

required capital ratios

deductions and adjustments,

rules increased

1 unchanged sentence

capital against

We will also be required to hold capital

against short-term commitments that are not unconditionally

We are also be required to hold capital against

short-term commitments that are not unconditionally cancellable.

While we currently meet these new

requirements of the Basel III-based capital requirements, we may

fail to do so in

requirements of the Basel III-based capital requirements, we

may fail to do so

to meet applicable

1 unchanged sentence

requirements could result

our regulators placing

regulators placing

limitations or conditions on our activities, including our growth initiatives, or restricting the commencement of new activities,

2 unchanged sentences

pay dividends on

stock, our ability

to make acquisitions,

and our business,

our capital stock,

our ability to

make acquisitions, and

our business, results

operations and financial condition, generally.

3 unchanged sentences

pandemic, bank

application of more stringent capital requirements for us

could, among other things, result in

lower returns on equity, require

application of more stringent capital requirements for

us could, among other things, result

in lower returns on equity, require

the raising of additional

1 unchanged sentence

in regulatory actions if

we were to be unable

to comply with such

requirements.

we were to be

unable to comply with

such requirements.

Implementation

13 unchanged sentences

could adversely affect us.

the bank regulatory

process, the Federal Reserve,

the FOFR periodically conduct

the bank regulatory process,

the Federal Reserve, the

FDIC and the FOFR

periodically conduct examinations

of our business,

including compliance

with applicable laws

and regulations.

of an examination,

with applicable

laws and regulations.

examination, one

concentration,

5 unchanged sentences

different remedial

include the power to prohibit the continuation of

"unsafe or unsound" practices, to require affirmative

actions to correct any

any violation

include the power to prohibit the continuation

of "unsafe or unsound" practices, to require

affirmative actions to correct any

administrative

10 unchanged sentences

an imminent risk

of loss to depositors,

regulatory actions, our business, financial condition, results

regulatory actions, our business, financial condition, result

of operations and reputation may be negatively impacted.

3 unchanged sentences

these laws could lead to a wide variety of sanctions.

The CRA directs all insured depository institutions to help meet the credit needs of

the local communities in which they

The CRA directs all insured depository institutions to help meet the credit needs of the local communities

in which they

moderate-income

12 unchanged sentences

business, financial condition and results of operations.

USCB Financial Holdings, Inc.

Climate change and related legislative and regulatory initiatives may materially affect the Company’s business

and results of operations.

Climate change and related legislative and regulatory initiatives may materially affect our business and results

of operations.

of climate change

alarming level

of concern for

As a result, the global business community has

increased its political and social awareness surrounding

the issue, and the

continue to create

a significant level

for the state

of the global

As a result, the global business community has increased

its political and social awareness surrounding the issue,

United States

3 unchanged sentences

the Paris Agreement.

state legislatures

and federal and

state regulatory agencies

state legislatures and

federal and state

regulatory agencies

USCB Financial Holdings, Inc.

propose numerous

initiatives to supplement

the global effort

to combat climate

even more expansive

administration,

respect to banks’

risk management

practices, accounting

for the effects

of climate change

in stress testing

scenarios and

risk assessments,

revising expectations

portfolio concentrations

climate-related

encouraging investment

in climate-related initiatives

to communities

disproportionately impacted

of climate change.

of empirical data

surrounding the

other financial

change render it difficult, or

even impossible, to predict how climate

change may impact our financial

condition and results

initiatives to

supplement the

global effort

climate change,

including provisions

administration, including potentially increasing supervisory

expectations with respect to banks’ risk management practices,

accounting for

the effects of

climate change in

stress testing

scenarios and systemic

risk assessments, revising

for credit portfolio concentrations based on climate-related factors

and encouraging investment by banks in climate-related

initiatives and

communities disproportionately

data surrounding the

credit and other

financial risks posed

by climate change

render it difficult, or

even impossible, to

how climate change

may impact our

financial condition

and results of

change may also directly impact us.

Specifically, unpredictable and more frequent weather disasters may adversely impact

the real property, and/or the

real property, securing the loans

in our portfolios.

Additionally, if insurance obtained

disasters and

related events,

financial condition

of operations.

the physical effects

of climate change may

also directly impact

Specifically,

unpredictable and

more frequent weather disasters may adversely impact the real property, and/or the value of the real property,

Additionally,

our borrowers

is insufficient

losses sustained

the collateral, or if

insurance coverage is

otherwise unavailable to

our borrowers, the

collateral securing our

negatively impacted by climate change, natural disasters and

related events, which could impact our

financial condition and

local economic

which could adversely

affect our customers

and the communities

Overall, climate

change, its effects

and the resulting, unknown impact could have a material adverse effect on our

financial condition and results of operations.

climate change may negatively impact

regional and local economic activity, which could adversely affect our

customers and

the communities in which

climate change, its

effects and the

resulting, unknown impact

material adverse effect on our financial condition

and results of operations.

Risks Related to Our Class A Common Stock

Our ability to pay dividends is subject to restrictions.

Holders of our Class A common stock are only

entitled to receive cash dividends when, as and

if declared by our Board

Holders of our Class A common stock

are only entitled to receive cash dividends when, as

and if declared by our Board

legally available

4 unchanged sentences

operations through the Bank,

which is a legal entity separate

and distinct from the

which is a legal entity

separate and distinct from

As a result, our ability

4 unchanged sentences

are numerous laws and banking

regulations and guidance that limit the

Bank's ability

regulations and guidance that limit

the Bank's ability

to pay dividends to us and our ability to pay dividends on our

3 unchanged sentences

and substantial losses for our shareholders.

wide fluctuations.

fluctuations.

addition, the trading volume on

6 unchanged sentences

fluctuations in the price or trading volume of our Class

A common stock, include:

A common stock, include but not limited to:

general market conditions;

5 unchanged sentences

industry in general;

the failure of securities analysts to cover our Class

A common stock after this offering;

additions or departures of our key personnel;

the determination of securities analysts to not cover our

Class A common stock;

the opinion of securities analysts about our stock as an investment;

additions to or departures of our key personnel;

future sales of our Class A common stock;

adverse market reactions to any indebtedness we may incur

or securities we may issue in the future;

adverse market reactions to any indebtedness we may

incur or securities we may issue in the future;

actions by our shareholders;

the expiration of contractual lock-up agreements;

the operating and securities price performance of

companies that investors consider to be comparable to us;

the operating and securities price performance of companies

that investors consider to be comparable to us;

changes or proposed changes in laws or regulations affecting

5 unchanged sentences

our business,

USCB Financial Holdings, Inc.

condition or results of operations.

any of the foregoing occurs, it could

cause our Class A common

If any of the foregoing occurs,

it could cause our Class A common

stock price to fall and

may expose us to lawsuits that, even if unsuccessful,

could be costly to defend and a distraction to management.

may expose us to lawsuits that, even if unsuccessful, could

be costly to defend and a distraction to management.

USCB Financial Holdings, Inc.

There are significant restrictions in our Articles of Incorporation that restrict the

ability to sell our capital stock

to shareholders that would own 4.95% or more of

our stock, excluding our Significant Investors.

to shareholders that would own 4.95% or more of our stock,

excluding our Significant Investors.

continued availability

5 unchanged sentences

Incorporation, except

may be approved

as otherwise may

be approved by

acquire stock to any

10 unchanged sentences

A common stock could be less attractive to investors.

“emerging growth

to take advantage

exemptions from

various reporting and

growth company,”

option to take

certain exemptions

reporting and

other requirements

that are applicable to other public companies that are not emerging

growth companies, including:

that are applicable to other public companies that are not

emerging growth companies, including:

discussion and analysis of financial condition and results

8 unchanged sentences

and reporting

company until the earliest of

(i) the last day of the first fiscal year

in which our annual gross revenues

exceed $1.07 billion,

(ii) the date that the market value of our Class A common stock

that is held by non-affiliates exceeds $700 million as of

last business day of

June 30 of that

year, (iii) the date on

which we have, during

the previous three-year period, issued

than $1 billion

in non-convertible

year following the

fifth anniversary

completion of

possible that

investors could

attractive if

requirements that

company until the

earliest to occur

the first fiscal

year in which

our annual gross

revenues exceed $1.235

billion, (ii) the date that the market value of our Class A common

stock that is held by non-affiliates exceeds $700 million as

of the last business day

in June of that year,

(iii) the date on which

we have, during the

previous three-year period, issued

more than $1 billion in non-convertible debt,

or (iv) the end of fiscal year following the fifth

anniversary of the completion of

our IPO (which will be December 31, 2026).

It is possible

investors may

find our Class

A common stock

less attractive

since we chose

If some investors find our Class A common

8 unchanged sentences

standards for an “emerging growth company,” our financial statements may not be comparable to companies that

comply with these accounting standards as of the public

company effective dates.

We have elected

extended transition

period for complying

comply with these accounting standards as of the

public company effective dates.

As an emerging

growth company,

we elected to

use the extended

transition period

for complying

accounting standards under Section 7(a)(2)(B) of the Securities Act.

This election allows us to delay the adoption of new or

revised accounting standards

Section 7(a)(2)(B) of

the Securities Act.

This election allows

the adoption of

new or revised

accounting standards

that have different

effective dates for

public and private companies

until those standards apply

public and private

companies until those

standards apply

to private companies.

this election,

result of this election, our

financial statements may not be

comparable to companies that comply

accounting standards

company effective

our financial

be comparable

standards as of the

public company effective dates.

our financial statements may

not be comparable to

performance or

comparison to

comparing our

business, performance

in comparison to

companies, which

cannot predict

this exemption.

investors find

attractive as

there may be a less active trading market for our Class A common

stock and our stock price may be more volatile.

impact on the value and liquidity of our Class A common stock.

We cannot predict if investors will find our Class A common

attractive as a result, there

may be a less active trading

market for our Class A common

stock and our stock price

more volatile.

We have existing investors that own

9 unchanged sentences

Capital Fund II,

USCB Financial Holdings, Inc.

approximately 22.71

, respectively, of our outstanding Class A common stock.

In addition, Patriot and Priam

approximately 22.82% and 22.83%,

respectively,

of our outstanding Class A

common stock.

Patriot and Priam

are each entitled to nominate a director to our Board and have certain subscription rights to purchase new equity securities

that we issued in the future,

in each case as long as certain equity

ownership criteria are met.

Priam also have

USCB Financial Holdings, Inc.

that we issue

in the future,

certain equity ownership

criteria are met.

Patriot and Priam

independent of each other, these institutional investors will continue to have a significant level of influence over us

1 unchanged sentence

Class A common

stock ownership and their

right to representation

stock ownership and

their right to representation

on our Board.

4 unchanged sentences

other acquisition transactions, amendments

to our Articles

of Incorporation and

Amended and Restated

Bylaws, and other

extraordinary corporate matters.

investors could

conflict with

the interests

other shareholders,

and any future

these investors

their shares of Class A common

stock to other investors who have

different business objectives

could adversely affect

business, results of operations, financial condition, prospects

or the market value of our Class A common

amended Articles

of Incorporation

other extraordinary

corporate matters.

The interests of these investors

could conflict with the interests of our

other shareholders, and any future transfer

investors of their shares

common stock to other

investors who have different

business objectives could adversely

affect our business, results of operations, financial condition,

prospects or the market value of our Class A common

anti-takeover

6 unchanged sentences

have an anti-takeover

difficult or prevent

that you may favor or an attempted replacement of our Board

or management.

make more difficult

or prevent an

attempted acquisition

that you may favor or an attempted replacement of our

Board or management.

Our governing documents include provisions that:

empower our Board, without shareholder

approval, to issue our preferred

stock, the terms of which,

including voting

power, are to be set by our

empower our Board, without shareholder approval, to issue shares of preferred stock, the terms of

which, including

voting power, are set by our

provide that directors may be removed from office only for cause and only upon a majority vote

of the shares of our

Bank with voting power;

prohibit holders of our Class A common stock

to take action by written consent in lieu of a shareholder meeting;

Company with voting power;

prohibit holders of our Class A common stock to take action

by written consent in lieu of a shareholder meeting;

require holders of at least 10% of our Class A common

1 unchanged sentence

do not provide for cumulative voting in elections of our

provide that our Board has the authority to amend our Amended

authority to amend

and Restated Bylaws

without shareholder approval;

require shareholders that wish to bring business before annual or special meetings of shareholders, or to nominate

4 unchanged sentences

annual meetings, the number of

persons serving as directors and to

persons serving as directors and

vacancies created

next meeting of

shareholders by

the directors

the increase until

shareholders by a

majority vote

present at a meeting of directors.

5 unchanged sentences

ongoing regulatory

shareholder or

other party that seeks to acquire direct or indirect "control" of

a bank holding company,

requirements on

any shareholder

other party that seeks to acquire direct or indirect "control" of a

bank holding company,

which includes the Change in Bank

"deferred tax assets," our Articles

of Incorporation prohibits any direct

or indirect transfer of stock

or options to acquire

"deferred tax assets," subject to

limited exceptions as provided in

our Articles of Incorporation.

of the requirements

to overcome this restriction, this provision of the Articles of Incorporation could have an anti-takeover effect and may delay,

make more difficult or prevent an attempted acquisition

an acquisition.

and continued

availability of

our "deferred

our Articles of

Incorporation prohibits

any direct or

indirect transfer

of stock or options

to acquire stock

to any person

result of the

would own 4.95%

as long as we continue

to have "deferred tax

assets," subject to limited

exceptions as provided in

our amended Articles

Incorporation.

Incorporation could

anti-takeover effect

that you may favor.

Adjust as necessary due to Class A common stock

USCB Financial Holdings, Inc.

Unresolved Staff Comments

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors