Freedom Holding (FRHC) Risk Analysis

Mr. Timur Turlov controls a majority of the voting power of our outstanding common stock. Accordingly, we qualify as a "controlled company" within the meaning of Nasdaq corporate governance standards. Under Nasdaq rules, a company of which more than 50% of the voting power is held by one individual is a "controlled company" and may elect not to comply with certain corporate governance standards, including the requirements that: - a majority of its board of directors consist of independent directors;- its nominating and corporate governance committee and compensation committee be composed entirely of independent directors;- the nominating and corporate governance committee and compensation committee have a written charter addressing such committees' purpose and responsibilities (such a charter is required for the audit committee); and - an annual evaluation of the compensation committee be performed (an annual evaluation of the nominating and corporate governance committee and audit committee is required). We currently utilize an exemption to allow Mr. Kairat Kelimbetov to sit on our nominating and corporate governance committee. The charters for each of our board committees provide for annual performance evaluations. Currently, we have a majority of independent directors on our board of directors. Our status as a controlled company and resulting available exemptions from corporate governance standards could make our common stock less attractive to some investors or otherwise harm our stock price.

Mr. Timur Turlov, our chief executive officer and chairman of our board, beneficially owns approximately 69% of our outstanding common stock. He currently has voting control of FRHC and can control the outcome of matters submitted to stockholders for approval. In addition, Mr. Turlov has the ability to control our management and affairs as a result of his position as our chief executive officer, chairman of our board and his ability to control the election of our directors. Mr. Turlov also has interests in other companies, certain of which have conducted significant amounts of business with our company and have significantly contributed to our revenues. Such related party transactions give increase to a risk of the conclusion of transactions on terms less favorable than could be obtained in arm's length transactions. The interests of Mr. Turlov could conflict with those of other stockholders. Any such conflict could have a material adverse effect on our business, financial condition, results of operations and cash flows. Mr. Turlov is prohibited from membership on the audit committee of our board under the terms of such committee's charter. However, Nevada corporate law can be viewed as more protective of officers and directors than the corporate laws of other U.S. state jurisdictions, and it therefore may not provide the same level of redress as other U.S. state corporate laws.

Timur Turlov, our chief executive officer and chairman of our board, beneficially owns approximately 69% of our outstanding common stock. Timur Turlov from time to time may commit to investing in significant business or other ventures, and as a result, be required to sell shares of our common stock in satisfaction of such commitments. Sales of substantial amounts of our common shares in the public market, or the perception that these sales may occur, could cause the market price of our common shares to decline. This could also impair our ability to raise additional capital through the sale of our equity securities. Sales of common shares by us or our shareholders could have a material adverse effect on the trading price of our common shares. Future issuances and sales of our common shares may have a negative impact on the market price of our common shares. In particular, sales of substantial amounts of our common shares (including shares issued in connection with an acquisition), or the perception that such sales could occur, may adversely affect prevailing market prices of our common shares. On April 9, 2026, we announced that we are considering an offering of our common stock in Kazakhstan. The offering, if we determine to proceed with such an offering, would be conducted outside the United States in reliance on Regulation S under the Securities Act of 1933. The shares offered in this offering will not be or have not been registered under the Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. Any such offering, or any other offering we may announce in the future, could result in the sale of a substantial number of our common shares.

The market price of our common stock may fluctuate significantly. Among the factors that could affect our stock price are: - the Russia-Ukraine conflict and related sanctions and their direct and indirect effects;- war involving Iran, together with escalating political and economic instability across the Middle East, including disruptions to critical transit routes, significant increases in crude oil prices and inflationary pressure;- geopolitical and civil unrest in any of the markets in which we operate;- global trade policies and the implementation of tariffs;- planned or completed acquisitions or disposals;- investigations, lawsuits, enforcement actions, and other claims by third parties or governmental authorities;- global economy policy changes, new regulatory pronouncements and changes in regulatory guidelines;- actual or anticipated fluctuations in our quarterly operating results;- changes in market valuations or earnings of similar companies;- any future sales of our common stock or other securities;- breaches of regulations by our employees;- changes in securities analysts' estimates of our financial performance or lack of research coverage and reports by industry analysts;- domestic and international economic factors unrelated to our performance;- pandemic and epidemic disease;- announcements by us of significant impairment charges;- investor perception of us and our industry;- announcements by us or our competitors of significant contracts, acquisitions, dispositions or strategic partnerships; and - speculation in the press or investment community. Stock markets can experience extreme volatility unrelated to the operating performance of any particular company. These broad market fluctuations may adversely affect the trading price of our common stock. In the past, following periods of volatility in the market price of a company's securities, class action litigation has often been instituted against the affected company. Any litigation of this type brought against us could result in substantial costs and a diversion of our management's attention and resources, which could materially and adversely affect our business, financial condition, results of operations and cash flows. During the first quarter of fiscal 2026, FRHC's common stock was included in the Russell 3000 Index. If our common stock does not continue to remain on the Russell 3000 Index and is removed because it does not meet the criteria for continued inclusion in such index, index funds, institutional investors, or other holders attempting to track the composition of that index may be required to sell our common stock, which would adversely impact the price and frequency at which it trades.