What changed in this filing

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Item 1. Financial Statements

2024-11-08 compared with 2024-08-08 · 536 added, 435 removed, 327 unchanged (75% of the section changed)

Financial Statements

HOLDINGS INC.

Consolidated Balance Sheets

DOMINARI HOLDINGS INC.

Condensed Consolidated Balance Sheets

($ in thousands except share and per share amounts)

September 30,

Current assets

23 unchanged sentences

5,000,000 shares designated;

3,825 shares issued and outstanding as of June 30, 2024 and December 31, 2023;

3,825 shares issued and outstanding as of September 30, 2024 and December 31, 2023;

liquidation value of $ 0.0001 per share

5,000,000 shares designated;

834 shares issued and outstanding as of June 30, 2024 and December 31, 2023;

834 shares issued and outstanding as of September 30, 2024 and December 31, 2023;

liquidation value of $ 0.0001 per share

Common stock, $ 0.0001 par value, 100,000,000 shares authorized;

6,304,183 and 5,995,065 shares issued as of June 30, 2024 and December 31, 2023 respectively;

6,244,035 and 5,934,917 shares outstanding as of June 30, 2024 and December 31, 2023 respectively;

6,336,286 and 5,995,065 shares issued as of September 30, 2024 and December 31, 2023, respectively;

6,276,138 and 5,934,917 shares outstanding as of September 30, 2024 and December 31, 2023

Additional paid-in capital

Treasury stock, as of cost, 60,148 shares as of June 30, 2024 and December 31, 2023

Treasury stock, as of cost, 60,148 shares as of September 30, 2024 and December 31, 2023

Accumulated deficit

1 unchanged sentence

Total liabilities and stockholders’ equity

accompanying notes to unaudited condensed consolidated financial statements.

HOLDINGS INC.

Consolidated Statements of Operations

See accompanying notes to unaudited condensed consolidated

financial statements.

DOMINARI HOLDINGS INC.

Condensed Consolidated Statements of Operations

($ in thousands except share and per share amounts)

Three Months Ended June 30,

Six Months Ended June 30,

Three Months Ended

September 30,

Nine Months Ended

September 30,

Operating costs and expenses

5 unchanged sentences

Interest income

Gain on marketable securities, net

Gain (loss) on marketable securities, net

Realized and unrealized loss on note receivable, net

Change in fair value of investments

Total other (expenses) income

Change in carrying value of investments

Total other expenses

Net loss per share, basic and diluted

2 unchanged sentences

Basic and Diluted

accompanying notes to unaudited condensed consolidated financial statements.

HOLDINGS INC.

Consolidated Statements of Changes in Redeemable Convertible Preferred Stock and Stockholders’ Equity

See accompanying notes to unaudited condensed consolidated

financial statements.

DOMINARI HOLDINGS INC.

Condensed Consolidated Statements of Changes

in Redeemable Convertible Preferred Stock and Stockholders’ Equity

($ in thousands except share and per share amounts)

the Three Months Ended June 30, 2024 and 2023

For the Three Months Ended September 30, 2024

Preferred Stock

1 unchanged sentence

Stockholders’

Balance at March 31, 2024

Balance at June 30, 2024

$ ( 220,324 )

Stock-based compensation

Balance at June 30, 2024

Balance at September 30, 2024

$ ( 224,535 )

2 unchanged sentences

Stockholders’

Balance at March 31, 2023

Balance at June 30, 2023

$ ( 198,306 )

Stock-based compensation

Balance at June 30, 2023

Balance at September 30, 2023

$ ( 201,847 )

See accompanying

notes to unaudited condensed consolidated financial statements

the Six Months Ended June 30, 2024 and 2023

See accompanying notes to unaudited condensed consolidated

financial statements

For the Nine Months Ended September 30, 2024

Preferred Stock

4 unchanged sentences

Stock-based compensation

Balance at June 30, 2024

Balance at September 30, 2024

$ ( 224,535 )

1 unchanged sentence

Treasury Stock

Total Stockholders’

Stockholders’

Balance at December 31, 2022

4 unchanged sentences

Retirement of treasury stock

Balance at June 30, 2023

Balance at September 30, 2023

$ ( 201,847 )

accompanying notes to unaudited condensed consolidated financial statements.

HOLDINGS INC.

Consolidated Statements of Cash Flows

See accompanying notes to unaudited condensed consolidated

financial statements.

DOMINARI HOLDINGS INC.

Condensed Consolidated Statements of Cash Flows

($ in thousands)

Six Months Ended June 30,

Nine Months Ended

September 30,

Cash flows from operating activities

1 unchanged sentence

Amortization of right-of-use assets

Change in fair value of long-term investment

Change in fair value short-term investments

Change in carrying value of long-term investment

Stock-based compensation

1 unchanged sentence

Unrealized (gain) loss on marketable securities

Unrealized loss on note receivable

Realized and unrealized loss on note receivable

Changes in operating assets and liabilities:

23 unchanged sentences

Net cash used in financing activities

Net increase (decrease) in cash and cash equivalents and restricted

Net increase (decrease) in cash and cash equivalents and restricted cash

Cash and cash equivalents, beginning of period

Cash and cash equivalents, end of period

accompanying notes to unaudited condensed consolidated financial statements.

HOLDINGS INC.

to Condensed Consolidated Financial Statements

Organization and Description of Business and Recent Developments

and Description of Business

Holdings Inc.

(the “Company”), formerly AIkido Pharma, Inc., was founded in 1967 as Spherix Incorporated.

Since 2017, the

Company has operated as a biotechnology company with a diverse portfolio of small-molecule anticancer and antiviral therapeutics and

their related patent technology.

The Company is in the process of winding down its historical pipeline of biotechnology assets held by

Aikido Labs, LLC.

In an effort to enhance shareholder value, in June of 2022, the Company formed a wholly owned financial services subsidiary,

Dominari Financial Inc.

(“Dominari Financial”), with the intent of shifting the Company’s primary operating focus away

from biotechnology to the fintech and financial services industries.

Through Dominari Financial, the Company acquired Dominari Securities

LLC (“Dominari Securities”), an introducing broker-dealer, registered with the Financial Industry Regulatory Authority (“FINRA”)

and an investment adviser registered with the Securities and Exchange Commission (“SEC”).

Dominari Securities provides investment

advisory services and annuity and insurance products of certain insurance carriers as an insurance agency through independent and affiliated

September 9, 2022, Dominari Financial entered into a membership interest purchase agreement, as amended and restated on March 27, 2023

(the “FPS Purchase Agreement”) with Fieldpoint Private Bank & Trust (“Seller”), a Connecticut bank, for the

purchase of its wholly owned subsidiary, Fieldpoint Private Securities, LLC, a Connecticut limited liability company (“FPS”),

that is a broker-dealer registered with the Financial Industry Regulatory Authority (“FINRA”) and an investment adviser registered

with the SEC.

Pursuant to the terms of the FPS Purchase Agreement, Dominari Financial purchased from the Seller 100 % of the

membership interests in FPS (the “Membership Interests”).

FPS’s registered broker-dealer and investment adviser businesses

will be operated as a wholly owned subsidiary of Dominari Financial.

The FPS Purchase Agreement provides for Dominari Financial’s

acquisition of FPS’s Membership Interests in two closings, the first of which occurred on October 4, 2022 (the “Initial

Closing”), at which Dominari Financial paid to the Seller $ 2.0 million in consideration for a transfer by the Seller to Dominari

Financial 20 % of the FPS Membership Interests.

Following the Initial Closing, FPS filed a continuing membership application

requesting approval for a change of ownership, control, or business operations with FINRA in accordance with FINRA Rule 1017 (the “Rule

1017 Application”).

See accompanying notes to unaudited condensed consolidated

financial statements.

DOMINARI HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements

Organization and Description of Business

and Recent Developments

Organization and Description of Business

Dominari Holdings Inc.

(the “Company”),

formerly AIkido Pharma, Inc., was founded in 1967 as Spherix Incorporated.

Since 2017, the Company operated as a biotechnology company

with a diverse portfolio of small-molecule anticancer and antiviral therapeutics and their related patent technology.

The Company is in

the process of winding down its historical pipeline of biotechnology assets held by Aikido Labs, LLC.

In an effort to enhance shareholder

value, in June of 2022, the Company formed a wholly owned financial services subsidiary, Dominari Financial Inc.

(“Dominari Financial”),

with the intent of shifting the Company’s primary operating focus away from biotechnology to the fintech and financial services

Through Dominari Financial, the Company acquired Dominari Securities LLC (“Dominari Securities”), an introducing

broker-dealer, registered with the Financial Industry Regulatory Authority (“FINRA”) and an investment adviser registered

with the Securities and Exchange Commission (“SEC”).

Dominari Securities provides investment advisory services and annuity

and insurance products of certain insurance carriers as an insurance agency through independent and affiliated brokers.

On September 9, 2022, Dominari Financial entered

into a membership interest purchase agreement, as amended and restated on March 27, 2023 (the “FPS Purchase Agreement”) with

Fieldpoint Private Bank & Trust (“Seller”), a Connecticut bank, for the purchase of its wholly owned subsidiary, Fieldpoint

Private Securities, LLC, a Connecticut limited liability company (“FPS”), that is a broker-dealer registered with the Financial

Industry Regulatory Authority (“FINRA”) and an investment adviser registered with the SEC.

Pursuant to the terms

of the FPS Purchase Agreement, Dominari Financial purchased from the Seller 100 % of the membership interests in FPS (the “Membership

FPS’s registered broker-dealer and investment adviser businesses will be operated as a wholly owned subsidiary

of Dominari Financial.

The FPS Purchase Agreement provides for Dominari Financial’s acquisition of FPS’s Membership

Interests in two closings, the first of which occurred on October 4, 2022 (the “Initial Closing”), at which Dominari

Financial paid to the Seller $ 2.0 million in consideration for a transfer by the Seller to Dominari Financial 20 % of the FPS Membership

Following the Initial Closing, FPS filed a continuing membership application requesting approval for a change of

ownership, control, or business operations with FINRA in accordance with FINRA Rule 1017 (the “Rule 1017 Application”).

The Rule 1017 Application was approved by FINRA on March 20, 2023.

The second closing occurred on March 27, 2023.

Dominari Financial paid to the Seller an additional $ 1.4 million in consideration for a transfer by the Seller to Dominari

Financial of the remaining 80 % of the Membership Interests.

As a result of the ownership change, FPS was renamed Dominari Securities

Dominari Financial paid

to the Seller an additional $ 1.4 million in consideration for a transfer by the Seller to Dominari Financial of the remaining 80 % of the

Membership Interests.

As a result of the ownership change, FPS was renamed Dominari Securities LLC.

October 13, 2023, the Company entered into two separate Limited Liability Agreements with Dominari Manager LLC (“Manager”)

and Dominari IM LLC (“Investment Manager”) which are both wholly owned subsidiaries and whose operations are included within

the consolidated condensed FS of Dominari Holdings Inc.

Manager was named as the manager of Dominari Master SPV LLC (the “Master

SPV”), a limited liability company formed by the Company in 2022, and is responsible for the day-to-day operations of the Master

Dominari IM LLC (“Investment Manager”) was named the investment manager of Master SPV and is responsible for providing

investment advice and decisions on behalf of the Master SPV.

On various dates from March 2024 through July 2024, the Manager established

various series of funds (the “Series”) of the Master SPV for the purpose of making investments in companies identified by

the Investment Manager with proceeds generated by the sale of non-voting interests in such Series by the Master SPV to investors.

On May 21, 2024, Dominari Financial and Heritage Strategies LLC (“HS”) entered into a Limited Liability

Company Operating Agreement (the “JV Agreement”) of Dominari Financial Heritage Strategies LLC (“DFHS”).

Agreement governs the operation of DFHS, including the distributions to the members of DFHS upon the offer, sale and renewal of various

insurance products and services, including life insurance, private placement insurance, group medical plans, qualified plans, business

insurance, and family office and estate planning services.

Pursuant to the terms of the JV Agreement, Dominari Financial and HS are the

co-managing members (the “Co-Managing Members”), each with fifty percent ( 50 %) ownership interests in DFHS.

Revenues from

the sale of the various insurance products and services after deducting general and administrative costs are distributed to the Co-Managing

Members as set forth in the JV Agreement.

the consolidated condensed financial statements of Dominari Holdings Inc.

Manager was named as the manager of Dominari Master SPV LLC

(the “Master SPV”), a limited liability company formed by the Company in 2022, and is responsible for the day-to-day operations

of the Master SPV.

Dominari IM LLC (“Investment Manager”) was named the investment manager of Master SPV and is responsible

for providing investment advice and decisions on behalf of the Master SPV.

Beginning in March 2024 , the

Manager established various series of funds (the “Series”) of the Master SPV for the purpose of making investments in companies

identified by the Investment Manager with proceeds generated by the sale of non-voting interests in such Series by the Master SPV to investors,

in which the Company may, from time to time as it deems appropriate, also invest in such series alongside third-party investors.

On May 21, 2024, Dominari Financial and Heritage

Strategies LLC (“HS”) entered into a Limited Liability Company Operating Agreement (the “JV Agreement”) of Dominari

Financial Heritage Strategies LLC (“DFHS”).

The JV Agreement governs the operation of DFHS, including the distributions to

the members of DFHS upon the offer, sale and renewal of various insurance products and services, including life insurance, private placement

insurance, group medical plans, qualified plans, business insurance, and family office and estate planning services.

Pursuant to the terms

of the JV Agreement, Dominari Financial and HS are the co-managing members (the “Co-Managing Members”), each with fifty percent

( 50 %) ownership interests in DFHS.

Revenues from the sale of the various insurance products and services after deducting general and administrative

costs are distributed to the Co-Managing Members as set forth in the JV Agreement.

Liquidity and Capital Resources

Company continues to incur ongoing administrative and other expenses, including public company expenses, in excess of corresponding (non-financing

related) revenue.

While the Company continues to implement its business strategy, it intends to finance its activities through managing

current cash on hand from the Company’s past equity offerings.

upon projected cash flow requirements, the Company has adequate cash and cash equivalents and marketable securities to fund its operations

for at least the next twelve months from the date of the issuance of these unaudited condensed consolidated financial statements.

The Company continues to incur ongoing administrative

and other expenses, including public company expenses, in excess of corresponding (non-financing related) revenue.

While the Company continues

to implement its business strategy, it intends to finance its activities through managing current cash on hand from the Company’s

past equity offerings.

Based upon projected cash flow requirements, the

Company has adequate cash and cash equivalents and marketable securities to fund its operations for at least the next twelve months from

the date of the issuance of these unaudited condensed consolidated financial statements.

Summary of Significant Accounting Policies

have been no material changes in the Company’s significant accounting policies from those previously disclosed in the 2023 Annual

of Presentation and Principles of Consolidation

accompanying unaudited condensed consolidated financial statements have been prepared in conformity with U.S.

generally accepted

accounting principles (“U.S.

GAAP”), and in conformity with the rules and regulations of the SEC.

In the opinion of

management, these financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a

fair statement of the results of the interim periods presented.

The condensed consolidated

balance sheet as of June 30, 2024, condensed consolidated statements of operations for the three months and

six months ended June 30, 2024 and 2023, condensed consolidated statements of stockholders’ equity for the three months and

six months ended June 30, 2024 and 2023, and the condensed consolidated statements of cash flows for the six months ended

June 30, 2024 and 2023 are unaudited, but include all adjustments, consisting only of normal recurring adjustments, which the

Company considers necessary for a fair presentation of the financial position, operating results and cash flows for the periods

The results for the three months ended June 30, 2024 are not necessarily indicative of results to be expected for the

year ending December 31, 2024 or for any future interim period.

The condensed consolidated balance sheet as of December 31, 2023 has

been derived from audited financial statements;

There have been no material changes in the Company’s

significant accounting policies from those previously disclosed in the 2023 Annual Report.

Basis of Presentation and Principles of Consolidation

The accompanying unaudited condensed consolidated

financial statements have been prepared in conformity with U.S.

generally accepted accounting principles (“U.S.

in conformity with the rules and regulations of the SEC.

In the opinion of management, these financial statements contain all adjustments,

consisting of only normal recurring adjustments, necessary for a fair statement of the results of the interim periods presented.

condensed consolidated balance sheet as of September 30, 2024, condensed consolidated statements of operations for the three months and

nine months ended September 30, 2024 and 2023, condensed consolidated statements of stockholders’ equity for the three months and

nine months ended September 30, 2024 and 2023, and the condensed consolidated statements of cash flows for the nine months ended September

30, 2024 and 2023 are unaudited, but include all adjustments, consisting only of normal recurring adjustments, which the Company considers

necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.

The results for

the three months and nine months ended September 30, 2024 are not necessarily indicative of results to be expected for the year ending

December 31, 2024 or for any future interim period.

The condensed consolidated balance sheet as of December 31, 2023 has been derived

from audited financial statements;

however, it does not include all of the information and notes required by U.S.

for complete financial statements.

The accompanying unaudited condensed consolidated financial statements should be read in

conjunction with the audited consolidated financial statements and notes thereto included in the Company’s annual report on

Form 10-K for the year ended December 31, 2023.

Company’s policy is to consolidate all entities that it controls by ownership of a majority of the membership interest or outstanding

voting stock.

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly

owned subsidiaries, Aikido Labs, Dominari Financial, and Dominari Securities.

All significant intercompany balances and transactions

have been eliminated in consolidation.

accompanying unaudited condensed consolidated financial statements have been prepared in conformity with U.S.

This requires management

to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosures of contingent assets

and liabilities at the date of the unaudited condensed consolidated financial statements, and the reported amounts of revenue and expenses

during the period.

The Company’s significant estimates and assumptions include stock-based compensation, the valuation of investments,

the valuation of notes receivable and the valuation allowance related to the Company’s deferred tax assets.

Certain of the Company’s

estimates could be affected by external conditions, including those unique to the Company and general economic conditions.

It is reasonably

possible that these external factors could have an effect on the Company’s estimates and could cause actual results to differ from

those estimates and assumptions.

with clearing broker

with Dominari Securities’ clearing broker consisted of approximately $ 13.4 million held in money market funds and liquid insured

deposits maintained by the Company with its clearing broker as of June 30, 2024.

Company accounts for its leases under ASC 842, Leases (“ASC 842”).

Under this guidance, arrangements meeting

the definition of a lease are classified as operating or financing leases and are recorded on the unaudited condensed consolidated balance

sheet as both a right-of-use asset and lease liability, calculated by discounting fixed lease payments over the lease term at the rate

implicit in the lease or the Company’s incremental borrowing rate.

Lease liabilities are increased by interest and reduced by payments

each period, and the right-of-use asset is amortized over the lease term.

For operating leases, interest on the lease liability and the

amortization of the right-of-use asset result in straight-line rent expense over the lease term.

For finance leases, interest on the

lease liability and the amortization of the right-of-use asset results in front-loaded expense over the lease term.

Variable lease expenses

are recorded when incurred (see Note 8 - Leases ).

Company recognizes revenue under ASC 606 - Revenue from Contracts with Customers (“ASC 606”) .

is recognized when control of the promised goods or performance obligations for services is transferred to the Company’s customers,

in an amount that reflects the consideration the Company expects to be entitled to in exchange for the goods or services.

following provides detailed information on the recognition of the Company’s revenue from contracts with customers:

services include underwriting and placement agent services in both the equity and debt capital markets, including private equity

placements, initial public offerings, follow-on offerings, and underwriting and distributing public and private debt.

and placement agent revenue are recognized at a point in time on trade-date, as the client obtains the control and benefit of the

underwriting offering at that point.

Costs associated with underwriting transactions are deferred until the related revenue is recognized

or the engagement is otherwise concluded and are recorded on a gross basis within the general and administrative line item in the

unaudited condensed consolidated statements of operations as the Company is acting as a principal in the arrangement.

reimbursed by the Company’s clients are recognized as other income.

are earned by executing transactions for clients primarily in equity, equity-related, and debt products.

Commission revenue associated

with trade execution are recognized at a point in time on trade-date.

Commissions revenue are generally paid on settlement date and

the Company records receivables to account for timing between trade-date and payment on settlement date.

advisory fees are earned in connection with investment advisory services.

Account advisory fees are recognized over time using

the time elapsed method as the Company determined that the customer simultaneously receives and consumes the benefits of investment

advisory services as they are provided.

GAAP for complete financial

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated

financial statements and notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2023.

The Company’s policy is to consolidate all

entities that it controls by ownership of a majority of the membership interest or outstanding voting stock.

The accompanying unaudited

condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Aikido Labs, Dominari

Financial, and Dominari Securities.

All significant intercompany balances and transactions have been eliminated in consolidation.

2024, the Company entered into a limited liability company operating agreement to form Dominari Financial Heritage Strategies LLC (“DFHS”).

The Company has a 50 % interest in DFHS.

The purpose of DFHS is to sell various insurance products and services, including life insurance,

private placement insurance, group medical plans, qualified plans, business insurance, and family office and estate planning services.

Company has determined it is not the primary beneficiary of DFH and thus will not consolidate the activities in its consolidated financial

The Company will account for its interest in DFHS under the equity method accounting in accordance with ASC 323.

of September 30, 2024, there has been no material activity in DFHS.

Use of Estimates

The accompanying unaudited condensed consolidated

financial statements have been prepared in conformity with U.S.

This requires management to make estimates and assumptions that

affect certain reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the unaudited

condensed consolidated financial statements, and the reported amounts of revenue and expenses during the period.

The Company’s significant

estimates and assumptions include stock-based compensation, the valuation of investments, the valuation of notes receivable and the valuation

allowance related to the Company’s deferred tax assets.

Certain of the Company’s estimates could be affected by external conditions,

including those unique to the Company and general economic conditions.

It is reasonably possible that these external factors could have

an effect on the Company’s estimates and could cause actual results to differ from those estimates and assumptions.

Deposits with clearing broker

Deposits with Dominari Securities’ clearing

broker consisted of approximately $ 14.2 million held in money market funds and liquid insured deposits maintained by the Company with

its clearing broker as of September 30, 2024.

The Company accounts for its leases under ASC

842, Leases (“ASC 842”).

Under this guidance, arrangements meeting the definition of a lease are classified

as operating or financing leases and are recorded on the unaudited condensed consolidated balance sheet as both a right-of-use asset and

lease liability, calculated by discounting fixed lease payments over the lease term at the rate implicit in the lease or the Company’s

incremental borrowing rate.

Lease liabilities are increased by interest and reduced by payments each period, and the right-of-use asset

is amortized over the lease term.

For operating leases, interest on the lease liability and the amortization of the right-of-use asset

result in straight-line rent expense over the lease term.

For finance leases, interest on the lease liability and the amortization of

the right-of-use asset results in front-loaded expense over the lease term.

Variable lease expenses are recorded when incurred (see Note

8 - Leases ).

The Company recognizes revenue under ASC

606 - Revenue from Contracts with Customers (“ASC 606”) .

Revenue is recognized when control of

the promised goods or performance obligations for services is transferred to the Company’s customers, in an amount that reflects

the consideration the Company expects to be entitled to in exchange for the goods or services.

The following provides detailed information on

the recognition of the Company’s revenue from contracts with customers:

Underwriting services include underwriting and private placement agent services in both the public and private equity and debt capital markets, including private equity placements, initial public offerings, follow-on offerings, and underwriting and distributing public and private debt.

Underwriting and placement agent revenue are recognized at a point in time on trade-date, as the client obtains the control and benefit of the underwriting offering at that point.

Costs associated with underwriting transactions are deferred until the related revenue is recognized or the engagement is otherwise concluded and are recorded on a gross basis within the general and administrative line item in the unaudited condensed consolidated statements of operations as the Company is acting as a principal in the arrangement.

Any expenses reimbursed by the Company’s clients are recognized as other income.

Commissions are earned by executing transactions for clients primarily in equity, equity-related, and debt products.

Commission revenue associated with trade execution are recognized at a point in time on trade-date.

Commissions revenue are generally paid on settlement date and the Company records receivables to account for timing between trade-date and payment on settlement date.

Account advisory fees are earned in connection with investment advisory services.

Account advisory fees are recognized over time using the time elapsed method as the Company determined that the customer simultaneously receives and consumes the benefits of investment advisory services as they are provided.

Account advisory fees are generally paid in advance of a specified service period (e.g.

and are initially deferred within in our Condensed Consolidated Balance Sheet.

revenue includes placement agent services in the equity capital markets for privately held companies distributing private equity.

Placement agent revenue are recognized at a point in time on trade-date, as the client obtains the control and benefit of the membership

interest offering at that point.

equity investments

Company accounts for long-term equity investments under Accounting Standards Codification (“ASC”) 321 “Investments—Equity

Securities” (“ASC 321”).

In accordance with ASC 321, equity securities with readily determinable fair values are accounted

for at fair value based on quoted market prices.

Equity securities without readily determinable fair values are accounted for either

at fair value or using the measurement alternative.

Under the measurement alternative, the equity investments are measured at cost, less

any impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a

similar investment of the Company.

adopted accounting standards

October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805) Accounting for Contract Assets and Contract Liabilities

from Contracts with Customers (“ASU 2021-08”).

This update amends Topic 805 to add contract assets and contract

liabilities to the list of exceptions to the recognition and measurement principles that apply to business combinations and to require

that an entity (acquirer) recognize and measure contract assets and contract liabilities in accordance with ASC 606.

adopted ASU 2021-08 on January 1, 2023.

There was no material impact to the Company’s unaudited condensed consolidated

financial statements from the implementation of ASU 2021-08.

June 2022, the FASB issued ASU 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions ,

to clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity

security and, therefore, is not considered in measuring the fair value of the equity security.

ASU 2022-03 also clarifies

that an entity cannot recognize and measure a contractual sale restriction as a separate unit of account.

The amendments in ASU 2022-03 may

be early adopted and are effective on a prospective basis for fiscal years beginning after December 15, 2023, and interim periods within

those fiscal years.

quarterly) and are initially deferred within in our Condensed Consolidated Balance Sheet.

Other revenue includes revenues such as miscellaneous fees and reimbursed expenses.

Long-term equity investments

The Company accounts for long-term equity investments

under Accounting Standards Codification (“ASC”) 321 “Investments—Equity Securities” (“ASC 321”).

In accordance with ASC 321, equity securities with readily determinable fair values are accounted for at fair value based on quoted market

Equity securities without readily determinable fair values are accounted for either at fair value or using the measurement alternative.

Under the measurement alternative, the equity investments are measured at cost, less any impairment, if any, plus or minus changes resulting

from observable price changes in orderly transactions for the identical or a similar investment of the same issuer.

Recently adopted accounting standards

In October 2021, the FASB issued ASU 2021-08,

Business Combinations (Topic 805) Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU

This update amends Topic 805 to add contract assets and contract liabilities to the list of exceptions to the

recognition and measurement principles that apply to business combinations and to require that an entity (acquirer) recognize and measure

contract assets and contract liabilities in accordance with ASC 606.

The Company adopted ASU 2021-08 on January 1, 2023.

There was no material impact to the Company’s unaudited condensed consolidated financial statements from the implementation of ASU

In June 2022, the FASB issued ASU 2022-03, Fair

Value Measurement of Equity Securities Subject to Contractual Sale Restrictions , to clarify that a contractual restriction on the

sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring

the fair value of the equity security.

ASU 2022-03 also clarifies that an entity cannot recognize and measure a contractual

sale restriction as a separate unit of account.

The amendments in ASU 2022-03 may be early adopted and are effective on

a prospective basis for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years.

The Company adopted ASU

2022-03 on January 1, 2024.

There was no material impact to the Company’s unaudited condensed consolidated financial statements

from the implementation of ASU 2022-03.

In March 2023, the FASB issued ASU 2023-01,

Leases , to require entities to classify and account for leases with related parties on the basis of legally enforceable terms

and conditions of the arrangement.

The amendments are effective in periods beginning after December 15, 2023, including interim periods

within those fiscal years.

The Company adopted ASU 2023-01 on January 1, 2024.

There was no material impact to the Company’s

unaudited condensed consolidated financial statements from the implementation of ASU 2023-01.

March 2023, the FASB issued ASU 2023-01, Leases , to require entities to classify and account for leases with related

parties on the basis of legally enforceable terms and conditions of the arrangement.

The amendments are effective in periods beginning

after December 15, 2023, including interim periods within those fiscal years.

The Company adopted ASU 2023-01 on January 1,

There was no material impact to the Company’s unaudited condensed consolidated financial statements from the implementation

of ASU 2023-01.

of new accounting pronouncements to be adopted in future periods

Company reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected

to have a significant impact on these unaudited condensed consolidated financial statements.

Effect of new accounting pronouncements to

be adopted in future periods

The Company reviewed all other recently issued

accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact on these unaudited

condensed consolidated financial statements.

Marketable Securities

realized gain or loss, unrealized gain or loss, and dividend income related to marketable securities for the three months ended June

30, 2024 and 2023, which are recorded as a component of gains and (losses) on marketable securities on the unaudited condensed consolidated

statements of operations, are as follows ($ in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

The realized gain or loss, unrealized gain or

loss, and dividend income related to marketable securities for the three months and nine months ended September 30, 2024 and 2023, which

are recorded as a component of gains and (losses) on marketable securities on the unaudited condensed consolidated statements of operations,

are as follows ($ in thousands):

Three Months Ended September 30,

Nine Months Ended

September 30,

Realized gain (loss)

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Long-Term Equity Investments

Company holds interests in several privately held and publicly traded companies as long-term investments.

The following table presents

the Company’s long-term investments as of June 30, 2024, and December 31, 2023 ($ in thousands):

Cost Basis as of

The Company holds interests in several privately

held and publicly traded companies as long-term investments.

The following table presents the Company’s long-term investments as

of September 30, 2024, and December 31, 2023 ($ in thousands):

December 31, 2023

September 30, 2024

Carrying Value

Investment in Kerna Health Inc

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Investment in Tevva Motors*

Investment in ASP Isotopes

Investment in Unusual Machines

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Investment in Cerebras*

Investment in Groq*

Investment in AdvEn

Investment in Anduril*

* Investments

made in these companies are through a Special Purpose Vehicle (“SPV”).

* Investments made in these companies are through a Special Purpose Vehicle (“SPV”).

The SPV is the holder of the actual stock.

does not hold these stock certificates directly.

** Investments

made in these companies are through both an SPV and direct investments.

The Company recorded unrealized losses on long term investments of approximately $ 3.0 million for the three month period ended June 30,

2024 and unrealized losses on long term investments of approximately $ 5.5 million for the six month period ended June 30, 2024.

The Company does not hold these stock certificates directly.

** Investments made in these companies are through both an SPV and direct investments.

The Company recorded an increase in the carrying

values of approximately $ 0.9 million for the three month period ended September 30, 2024 and a decrease in the carrying values of approximately

$ 4.6 million for the nine month period ended September 30, 2024.

The Company also recorded a $( 0.5 ) million change in carrying value of

investment upon transferring Unusual Machine, Inc shares to marketable securities in addition to the $( 6.0 ) million year to date change

from the above table.

See Investment in Unusual Machine, Inc below.

Investment in SpaceX

The Company’s investment in SpaceX was marked

down to cost for the three month period ended March 31, 2024 which resulted in a unrealized loss of $ 1.4 million.

In April, the Company

redeemed 36,842 shares of participating membership units of SpaceX for $ 3.5 million.

2, 2024, the Company entered into an agreement (the “xAI Agreement”) with Series VI xAI Units of Dominari Master SPV LLC.

Under the xAI Agreement, the Company agreed to purchase 100,000 Series XI xAI Units for $ 0.1 million.

17, 2024, the Company entered into an agreement (the “Cerebras Agreement”) with Series XI Cerebras Units of Dominari Master

SPV LLC, Under the xAI Agreement, the Company agreed to purchase 25,000 Series XI Cerebras Units for $ 25,000 .

in Unusual Machines

Machines, Inc, an emerging leader in first-person view (FPV) drone technology, closed its initial public offering of common stock on

February 14, 2024 at a public offering price of $ 4 per share and the shares began trading on the NYSE American under the ticker

symbol “UMAC”.

As of June 30, 2024 the Company valued its investment in Unusual Machines based on UMAC’s market

price of $ 1.30 .

in Tevva Motors

On September 22, 2021, the Company entered into a

securities purchase agreement (the “Tevva Motors Subscription Agreement”) with Big Sky Opportunities Fund, LLC, who handled

The Company redeemed its holdings in SpaceX in

April of 2024 totaling 36,842 shares of participating membership unites of SpaceX for $ 3.5 million.

This resulted in the Company recording

a decrease in the carrying value of the investment for the nine month period ended September 30, 2024.

Investment in xAI

On May 2, 2024, the Company entered into an agreement

(the “xAI Agreement”) with Dominari Master SPV LLC whereby the Company agreed to purchase 100,000 Series XI xAI Units

for $ 0.1 million.

Investment in Cerebras

On June 17, 2024, the Company entered into an

agreement (the “Cerebras Agreement”) with Dominari Master SPV LLC whereby the Company agreed to purchase 25,000 Series

XI Cerebras Units for $ 25,000 .

Investment in Groq

On July 25, 2024, the Company entered into an

agreement (the “Groq Agreement”) with Dominari Master SPV LLC whereby the Company agreed to purchase 25,000 Series XII Groq

Units for $ 25,000 .

Investment in Unusual Machines

Unusual Machines, Inc, an emerging leader in first-person

view (FPV) drone technology, closed its initial public offering of common stock on February 14, 2024 at a public offering price of $ 4

per share and the shares began trading on the NYSE American under the ticker symbol “UMAC”.

As of September 30, 2024, the

value of the Company’s holdings in UMAC are presented within the Marketable Securities line item of the financial statements, as

the investment has a readily determinable fair value.

Investment in Tevva Motors

On September 22, 2021, the Company entered into

a securities purchase agreement (the “Tevva Motors Subscription Agreement”) with Big Sky Opportunities Fund, LLC, who handled

the offering for Tevva Motors.

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Company identified indicators of impairment for the Tevva investment as a result of liquidity concerns As a result, the Company recorded

an impairment charge of approximately $ 2.8 million and the investment in Tevva was valued at $ 0 as of June 30, 2024.

On March 23, 2022, the Company entered into a securities

purchase agreement (the “Tesspay Securities Purchase Agreement”) with Tesspay.

Under the Tesspay Securities Purchase Agreement,

the Company agreed to purchase 1,000,000 shares of common stock of Tesspay for approximately $ 0.2 million.

also invested an additional $ 1.0 million for pre-IPO shares with Revere Master SPV LLC-Series VI, who handled the offering for Tesspay.

an impairment charge of approximately $ 2.8 million and the investment in Tevva was valued at $ 0 as of September 30, 2024.

Investment in Tesspay

On March 23, 2022, the Company entered into a

securities purchase agreement (the “Tesspay Securities Purchase Agreement”) with Tesspay.

Under the Tesspay Securities Purchase

Agreement, the Company agreed to purchase 1,000,000 shares of common stock of Tesspay for approximately $ 0.2 million.

Company also invested an additional $ 1.0 million for pre-IPO shares with Revere Master SPV LLC-Series VI, who handled the offering

As of December 31, 2023 the investment was valued at $ 2.7 million.

Management noted that Tesspay filed an amendment to its SEC Form S-1

Registration Statement on April 30, 2024 wherein Tesspay disclosed its intent to IPO at between $ 5.0 and $ 6.0 price per share.

the first six months of 2024 the Company has recorded an unrealized gain of $ 0.7 million and the investment is valued at $ 3.4 million

as of June 30, 2024.

April 2022, the Company entered into a securities purchase agreement (the “Anduril Securities Purchase Agreement”) with

Forge Investments LLC, Fund FG-MHM, who handled the offering of Anduril Industries, Inc.

Management noted that Tesspay filed an amendment to its

SEC Form S-1 Registration Statement on April 30, 2024 wherein Tesspay disclosed its intent to IPO at between $ 5.0 and $ 6.0 price per share.

However, given the uncertainty around the probability of the timing of an IPO, the Company has written its investment down to its cost

Through the first nine months of 2024 the Company has recorded a decrease in the carrying value of the investment of $ 1.4 million,

with a carrying value of $ 1.2 million as of September 30, 2024.

Investment in Anduril

In April 2022, the Company entered into a securities

purchase agreement (the “Anduril Securities Purchase Agreement”) with Forge Investments LLC, Fund FG-MHM, who handled the

offering of Anduril Industries, Inc.

shares, a privately-held defense products company.

As of December 31, 2023 the investment was valued at $ 0.5 million.

During the second

quarter 2024 review of the investment Dominari noted news activity related to a recent arm's length funding round, raising $ 1.5

As a result of this the implied holding value of the investment had decreased slightly per the Company’s independent

third-party valuation.

As of December 31, 2023 the investment was valued

at $ 0.5 million.

During the second quarter 2024 review of the investment Dominari noted news activity related to a recent arm’s length

funding round, raising $ 1.5 billion.

As a result of this the implied holding value of the investment had decreased slightly per the Company’s

independent third-party valuation.

As a result, the Company recorded an impairment charge of approximately $ 0.1 million and the investment

in Anduril was valued at $ 0.4 million as of the second quarter of 2024.

2022, the Company entered into a securities purchase agreement (the “Thrasio Securities Purchase Agreement”) with privately-held

company Thrasio, LLC, an aggregator of private brands of top Amazon businesses and direct-to-consumer brands.

As of December 31, 2023

the investment was valued at $ 0.3 million.

During our first quarter 2024 review of the Thrasio investment Dominari noted news activity

related to Thrasio had filed for Chapter 11 bankruptcy protection.

As a result, the Company recorded an impairment charge of approximately

$ 0.3 million and the investment in Thrasio was valued at $ 0 as of the first quarter 2024 and the second quarter of 2024.

in Epic Games

March 22, 2022, the Company entered into a securities purchase agreement (the “Epic Games Securities Purchase

Agreement”) with Aeon Partners Fund, Series EG, who handled the offering of Epic Games shares.

Under the Epic Games Securities

Purchase Agreement, the Company agreed to purchase an aggregate of 901 shares of common stock of Epic Games for a total

$ 1.5 million.

In April 2022, the Company invested an additional $ 2 million for the purchase of additional shares of common

stock of Epic Games through the Aeon Partners Fund, Series EG.

in Anduril was valued at $ 0.4 million as of the third quarter of 2024.

Investment in Thrasio

In April 2022, the Company entered into a securities

purchase agreement (the “Thrasio Securities Purchase Agreement”) with privately-held company Thrasio, LLC, an aggregator of

private brands of top Amazon businesses and direct-to-consumer brands.

As of December 31, 2023 the investment was valued at $ 0.3 million.

During the Company’s first quarter of

2024 review of the investment Dominari noted a $ 1.5 billion funding round at a lower price per share than the Company's initial

investment in Epic Games resulting in a $ 0.9 million unrealized loss on this investment during the six months ended June 30,

The investment was valued at $ 2.7 million as of June 30, 2024.

During our first quarter 2024 review of the Thrasio investment Dominari noted news activity related to Thrasio had filed for Chapter 11

bankruptcy protection.

As a result, the Company recorded an impairment charge of approximately $ 0.3 million and the investment in

Thrasio was valued at $ 0 as of September 30, 2024.

Investment in Epic Games

On March 22, 2022, the Company entered into a

securities purchase agreement (the “Epic Games Securities Purchase Agreement”) with Aeon Partners Fund, Series EG, who handled

the offering of Epic Games shares.

Under the Epic Games Securities Purchase Agreement, the Company agreed to purchase an aggregate of 901 shares

of common stock of Epic Games for a total $ 1.5 million.

In April 2022, the Company invested an additional $ 2 million for the

purchase of additional shares of common stock of Epic Games through the Aeon Partners Fund, Series EG.

As of December 31, 2023 the investment

was valued at $ 3.5 million.

During the Company’s first quarter of 2024 review of the investment Dominari noted a $ 1.5 billion funding

round at a lower price per share than the Company’s initial investment in Epic Games resulting in a $ 0.9 million decrease in the

carrying value of this investment during the nine months ended September 30, 2024.

The investment was valued at $ 2.7 million as of September

Investment in AdvEn

On December 26, 2021, the Company entered into

a securities purchase agreement (the “AdvEn Securities Purchase Agreement”) with AdvEn Inc.

(“AdvEn’), formerly

known as Nano Innovations Inc.

Under the AdvEn Securities Purchase Agreement, the Company purchased a 10 % senior secured convertible promissory

note (the “AdvEn Convertible Note”) in the principal amount of $ 750,000 and warrants (“AdvEn Warrants”, and together

with the AdvEn Convertible Note, the “AdvEn Convertible Securities”) permitting the Company to purchase an amount of AdvEn’s

common voting shares equal to 50 % of the number of common shares issuable upon the conversion of the AdvEn Convertible Note.

paid a purchase price of $ 750,000 for the AdvEn Convertible Note and the AdvEn Warrants.

In the fourth quarter of 2022, the Company identified

indicators of impairment and recorded an impairment loss on the total investment held.

On September 11, 2024, the Company entered into

a securities exchange agreement with AdvEn in which the Company agreed to cancel and retire the AdvEn Convertible Securities in exchange

for a number of shares of Series D preferred stock of AdvEn equal to 110 % of the outstanding amount of the AdvEn Convertible Note that

was cancelled multiplied by AdvEn’s initial public offering price, which is convertible into shares and warrants (the “Exchange”)

and carries a liquidation preference of $ 1,000 per share.

The investment was valued at $ 0.9 million as of September 30, 2024.

Notes Receivable

following table presents the Company’s notes receivable as of June 30, 2024 and December 31, 2023 ($ in thousands):

The following table presents the Company’s

notes receivable as of September 30, 2024 and December 31, 2023 ($ in thousands):

September 30, 2024

Maturity Date Stated Interest Rate Principal Amount Interest Receivable Fair Value

5 unchanged sentences

Notes receivable, at fair value - non-current portion $ 1,128

December 31, 2023

Maturity Date Stated Interest Rate Principal Amount Interest Receivable Fair Value

5 unchanged sentences

Notes receivable, at fair value - non-current portion $ 1,129

Therapeutics, Inc.

Company recorded principal repayment of approximately $ 0.3 million, interest income of approximately $ 59,000 and an unrealized loss on

the note of approximately $ 9,000 on the Convergent Convertible Note for the three months ended June 30, 2024.

Company recorded principal repayment of $ 0.5 million, interest income of approximately $ 0.1 million and an unrealized gain on the note

of approximately $ 50,000 on the Convergent Convertible Note for the six months ended June 30, 2024.

Industries LLC

Company recorded a realized loss as a result of directly writing off approximately $ 0.7 million and $ 1.7 million of principal, which the Company deemed

uncollectible during the three and six months ended June 30, 2024, respectively.

Innovative Robotics, LLC

Company recorded interest income of approximately $ 22,440 , and an unrealized loss on the note of approximately $ 1,008 on the Robotics

Promissory Note for the six three months ended June 30, 2024.

Company recorded interest income of approximately $ 44,000 , and an unrealized loss on the note of approximately $ 1,000 on the Robotics

Promissory Note for the six months ended June 30, 2024.

Fair Value of Financial Assets and Liabilities

instruments, including cash and cash equivalents, accounts payable and accrued liabilities are carried at cost, which management believes

approximates fair value due to the short-term nature of these instruments.

The Company measures the fair value of financial assets and

liabilities based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal

or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value.

Company uses three levels of inputs that may be used to measure fair value:

1 - quoted prices in active markets for identical assets or liabilities

2 - quoted prices for similar assets and liabilities in active markets or inputs that are observable

3 - inputs that are unobservable (for example, cash flow modeling inputs based on assumptions)

inputs are based on market data obtained from independent sources, while unobservable inputs are based on the Company’s market

Unobservable inputs require significant management judgment or estimation.

In some cases, the inputs used to measure an

asset or liability may fall into different levels of the fair value hierarchy.

In those instances, the fair value measurement is required

to be classified using the lowest level of input that is significant to the fair value measurement.

Such determination requires significant

management judgment.

following table presents the Company’s assets and liabilities that are measured at fair value as of June 30, 2024, and December

31, 2023 ($ in thousands):

Fair value measured as of June 30, 2024

Convergent Therapeutics, Inc.

The Company recorded principal repayment of approximately

$ 0.3 million, interest income of approximately $ 53,000 and an unrealized loss on the note of approximately $ 21,000 on the Convergent Convertible

Note for the three months ended September 30, 2024.

The Company recorded principal repayment of $ 0.7

million, interest income of approximately $ 0.2 million on the Convergent Convertible Note for the nine months ended September 30, 2024.

Raefan Industries LLC

The Company recorded a realized loss as a result

of directly writing off approximately $ 0.4 million and $ 2.1 million of principal and interest, which the Company deemed uncollectible

during the three and nine months ended September 30, 2024, respectively.

American Innovative Robotics, LLC

The Company recorded interest income of approximately

$ 22,000 , and an unrealized loss on the note of approximately $ 500 on the Robotics Promissory Note for the three months ended September

The Company recorded interest income of approximately

$ 67,000 , and an unrealized loss on the note of approximately $ 1,700 on the Robotics Promissory Note for the nine months ended September

Fair Value of Financial Assets and

Financial instruments, including cash and cash

equivalents, accounts payable and accrued liabilities are carried at cost, which management believes approximates fair value due to the

short-term nature of these instruments.

The Company measures the fair value of financial assets and liabilities based on the exchange

price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market

for the asset or liability in an orderly transaction between market participants on the measurement date.

The Company maximizes the use

of observable inputs and minimizes the use of unobservable inputs when measuring fair value.

The Company uses three levels of inputs that may

be used to measure fair value:

Level 1 - quoted prices in active markets

for identical assets or liabilities

Level 2 - quoted prices for similar

assets and liabilities in active markets or inputs that are observable

Level 3 - inputs that are unobservable

(for example, cash flow modeling inputs based on assumptions)

Observable inputs are based on market data obtained

from independent sources, while unobservable inputs are based on the Company’s market assumptions.

Unobservable inputs require significant

management judgment or estimation.

In some cases, the inputs used to measure an asset or liability may fall into different levels of the

fair value hierarchy.

In those instances, the fair value measurement is required to be classified using the lowest level of input that

is significant to the fair value measurement.

Such determination requires significant management judgment.

The following table presents the Company’s

assets and liabilities that are measured at fair value as of September 30, 2024, and December 31, 2023 ($ in thousands):

Fair value measured as of September 30, 2024

September 30,

active markets

11 unchanged sentences

Notes receivable at fair value, non-current portion

3 Measurement

following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial assets that are measured

at fair value on a recurring basis ($ in thousands):

Level 3 Measurement

The following table sets forth a summary of the

changes in the fair value of the Company’s Level 3 financial assets that are measured at fair value on a recurring basis ($ in thousands):

September 30, 2024

Notes receivable at fair value, current portion at December 31, 2023

2 unchanged sentences

Change in interest receivable

Notes receivable at fair value, current portion at June 30, 2024

Notes receivable at fair value, current portion at September 30, 2024

Notes receivable at fair value, non-current portion at December 31, 2023

Unrealized gain (loss) on notes receivable

Notes receivable at fair value, non-current portion at June 30, 2024

Notes receivable at fair value, non-current portion at September 30, 2024

September 30, 2023

Short-term investment at December 31, 2022

Short-term investment at June 30, 2023

Change in fair value of investment

Short-term investment at September 30, 2023

Notes receivable at fair value, current portion at December 31, 2022

3 unchanged sentences

Accrued interest receivable

Notes receivable at fair value, current portion at June 30, 2023

Notes receivable at fair value, current portion at September 30, 2023

Notes receivable at fair value, non-current portion at December 31, 2022

1 unchanged sentence

Accrued interest receivable

Notes receivable at fair value, non-current portion at June 30, 2023

Receivable at fair value

of June 30, 2024, the fair value of the notes receivable was measured taking into consideration cost basis, market participant

inputs, market conditions, liquidity, operating results and other qualitative and quantitative factors.

For the six month period

ended June 30, 2024 the Company had realized and unrealized losses on notes receivable

of $ 1.7 million and for the three month period ended the Company had realized and unrealized losses on notes receivable of $ 0.7 million.

December 1, 2021, the Company entered into a Lease Agreement (the “Company’s Lease”) with Trump Tower Commercial LLC,

a New York limited liability company.

Under the Company’s Lease, the Company rents a portion of the twenty-second floor at 725

Fifth Avenue, New York, New York (the “22 nd Floor Premises”).

The Company currently uses the 22 nd Floor

Premises to run its day-to-day operations.

The initial term of the Company’s Lease is seven ( 7 ) years commencing on July 11, 2022

(“Commencement Date).

Under the Company’s Lease, the Company is required to pay monthly rent, commencing on January 11, 2023,

equal to $ 12,874 .

Effective for the sixth and seventh years of the Company’s Lease, the rent shall increase to $ 13,502 .

took possession of the 22 nd Floor Premises on the Commencement Date.

September 23, 2022, Dominari Financial entered into a Lease Agreement (“Dominari Financial’s Lease”) with Trump Tower

Commercial LLC, a New York limited liability company.

Under Dominari Financial’s Lease, Dominari Financial rents a portion of a

floor at 725 Fifth Avenue, New York, New York (the “Premises”).

Dominari Financial currently uses the Premises to run its

day-to-day operations.

The initial term of Dominari Financial’s Lease is seven ( 7 ) years commencing on the date that possession

of the Premises is delivered to Dominari Financial.

Under Dominari Financial’s Lease, Dominari Financial is required to pay monthly

rent equal to $ 49,368 .

Effective for the sixth and seventh years of Dominari Financial’s Lease, the rent shall increase to $ 51,868 per

The Company took possession of the Premises in February 2023.

tables below represent the Company’s lease assets and liabilities as of June 30, 2024:

Notes receivable at fair value, non-current portion at September 30, 2023

Notes Receivable at fair value

As of September 30, 2024, the fair value of the

notes receivable was measured taking into consideration cost basis, market participant inputs, market conditions, liquidity, operating

results and other qualitative and quantitative factors.

For the nine month period ended September 30, 2024 the Company had realized and

unrealized losses on notes receivable of $ 2.1 million and for the three month period ended the Company had realized and unrealized losses

on notes receivable of $ 0.4 million.

On December 1, 2021, the Company entered into

a Lease Agreement (the “Company’s Lease”) with Trump Tower Commercial LLC, a New York limited liability company.

the Company’s Lease, the Company rents a portion of the twenty-second floor at 725 Fifth Avenue, New York, New York (the “22 nd Floor

The Company currently uses the 22 nd Floor Premises to run its day-to-day operations.

The initial term

of the Company’s Lease is seven ( 7 ) years commencing on July 11, 2022 (“Commencement Date).

Under the Company’s Lease,

the Company is required to pay monthly rent, commencing on January 11, 2023, equal to $ 12,874 .

Effective for the sixth and seventh years

of the Company’s Lease, the rent shall increase to $ 13,502 .

The Company took possession of the 22 nd Floor Premises

on the Commencement Date.

On September 23, 2022, Dominari Financial entered

into a Lease Agreement (“Dominari Financial’s Lease”) with Trump Tower Commercial LLC, a New York limited liability

Under Dominari Financial’s Lease, Dominari Financial rents a portion of a floor at 725 Fifth Avenue, New York, New York

(the “Premises”).

Dominari Financial currently uses the Premises to run its day-to-day operations.

The initial term of Dominari

Financial’s Lease is seven ( 7 ) years commencing on the date that possession of the Premises is delivered to Dominari Financial.

Under Dominari Financial’s Lease, Dominari Financial is required to pay monthly rent equal to $ 49,368 .

Effective for the sixth and

seventh years of Dominari Financial’s Lease, the rent shall increase to $ 51,868 per month.

The Company took possession of the

Premises in February 2023.

The tables below represent the Company’s

lease assets and liabilities as of September 30, 2024:

September 30,

Operating lease right-of-use-assets

following tables summarize quantitative information about the Company’s operating leases, under the adoption of ASC 842:

The following tables summarize quantitative information

about the Company’s operating leases, under the adoption of ASC 842:

September 30,

Weighted-average remaining lease term – operating leases (in years) 5.7

Weighted-average discount rate – operating leases 10.0 %

the three and six months ended June 30, 2024 and 2023, the Company recorded approximately $ 0.2 million, respectively, of lease

expense to current period operations.

During the three and nine months ended September

30, 2024 and 2023, the Company recorded approximately $ 0.2 million, respectively, of lease expense to current period operations.

Three Months Ended

Nine Months Ended

September 30,

Operating leases

Operating lease cost

Operating lease expense

Short-term lease rent expense

Net rent expense

Three Months Ended

Nine Months Ended

September 30,

Operating leases

Operating lease cost

Operating lease expense

Short-term lease rent expense

Net rent expense

cash flow information related to leases were as follows:

Supplemental cash flow information related to

leases were as follows:

Nine Months Ended

September 30,

Operating cash flows - operating leases

of June 30, 2024, future minimum payments during the next five years and thereafter are as follows:

As of September 30, 2024, future minimum payments

during the next five years and thereafter are as follows:

Remaining Period Ended December 31, 2024

13 unchanged sentences

Securities that could potentially dilute loss per share in the future that were not included in the

computation of diluted loss per share for the six months ended June 30, 2024, and 2023 are as follows:

As of June 30,

computation of diluted loss per share for the nine months ended September 30, 2024, and 2023 are as follows:

As of September 30,

Convertible preferred stock

4 unchanged sentences

Preferred Stock

As of June 30, 2024, there are 6,304,183 shares

of common stock issued and 6,244,035 shares outstanding.

As of September 30, 2024, there are 6,336,286

shares of common stock issued and 6,276,138 shares outstanding.

Treasury Stock

There are 60,148 shares of treasury stock as of

June 30, 2024.

September 30, 2024.

A summary of warrant activity for the three months

ended June 30, 2024, is presented below:

ended September 30, 2024, is presented below:

Warrants Weighted Average Exercise Price Total Intrinsic Value Weighted Average Remaining Contractual Life

Outstanding as of December 31, 2023 444,796 $ 29.25 -

Outstanding as of June 30, 2024 444,796 $ 29.25 -

Outstanding as of September 30, 2024 444,796 $ 29.25 -

Restricted Stock Awards

On June 11, 2024, the Company executed grant

agreements with each of Messrs.

Anthony Hayes and Kyle Wool pursuant to their employment agreements with the Company, and in

accordance with the Company’s 2022 Equity Incentive Plan.

Pursuant to the grant agreements, each received 154,559 shares of

the Company’s common stock.

Upon issuance, the shares were fully-vested and nonforfeitable with a total fair value of

approximately $ 0.7 million.

See Restricted Stock roll-forward below.

In October 2023, the Company issued an aggregate

of 96,311 shares of the Company’s common stock to a member of the Company’s Board of Directors for services rendered.

These restricted stock awards were vested in 1/3 increments in annual installments beginning April 13, 2024.

During the nine months ended

September 30, 2024, 32,103 shares were vested and the remaining shares forfeited.

On June 11, 2024, the Company executed grant agreements

with each of Messrs.

Anthony Hayes and Kyle Wool pursuant to their employment agreements with the Company, and in accordance with the

Company’s 2022 Equity Incentive Plan.

Pursuant to the grant agreements, each received 154,559 shares of the Company’s common

Upon issuance, the shares were fully-vested and nonforfeitable with a total fair value of approximately $ 0.7 million.

Restricted Stock roll-forward below.

A summary of restricted stock awards activity

for the three months ended June 30, 2024, is presented below:

for the nine months ended September 30, 2024, is presented below:

Number of Restricted Stock Awards

1 unchanged sentence

Nonvested at December 31, 2023

Nonvested at June 30, 2024

Nonvested at September 30, 2024

Stock-based compensation associated with the amortization

of restricted stock awards expense was approximately $ 75,000 and $ 257 for the three months ended June 30, 2024, and 2023, respectively.

All stock compensation was recorded as a component of general and administrative expenses.

As of June 30, 2024, there is approximately $ 0.2

million unrecognized stock-based compensation expense related to restricted stock awards.

of restricted stock awards expense was approximately $ 41,000 and $ 93,000 for the three months ended September 30, 2024, and 2023, respectively,

and $ 0.8 million and $ 2.7 million for the nine months ended September 30, 2024 and 2023, respectively.

All stock compensation was recorded

as a component of general and administrative expenses.

As of September 30, 2024, there is approximately

$ 82,800 unrecognized stock-based compensation expense related to restricted stock awards.

Stock Options

A summary of option activity under the Company’s

stock option plan for the three months ended June 30, 2024, is presented below:

stock option plan for the nine months ended September 30, 2024, is presented below:

Number of Shares Weighted Average Exercise Price Total Intrinsic Value Weighted Average Remaining Contractual Life (in years)

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Employee options expired ( 180 ) $ 3,832.72 -

Outstanding as of June 30, 2024 420,060 $ 4.48 $ -

Outstanding as of September 30, 2024 419,988 $ 4.16 $ -

Options vested and exercisable 156,176 $ 5.43 $ -

Stock-based compensation associated with the amortization

of stock option expense was approximately $ 0.1 million and $ 5,000 for the three months ended June 30, 2024, and 2023, respectively.

stock compensation was recorded as a component of general and administrative expenses.

of stock option expense was approximately $ 0.1 million and $ 5,000 for the three months ended September 30, 2024, and 2023, respectively,

and $ 0.3 million and $ 26,000 for the nine months ended September 30, 2024 and 2023, respectively.

All stock compensation was recorded

as a component of general and administrative expenses.

Estimated future stock-based compensation expense

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The following table presents our total revenue

disaggregated by revenue type for the three months ended June 30, 2024 and 2023 (in thousands):

disaggregated by revenue type for the three and nine months ended September 30, 2024 and 2023 (in thousands):

Three Months Ended

Six Months Ended

September 30,

Nine Months Ended

September 30,

Advisory fees

Placement fee

Commitments and Contingencies

Legal Proceedings

Company may be subject to certain legal and other claims that arise in the ordinary course of its business.

In particular, the Company

and its subsidiaries may be named in and subject to various proceedings and claims arising primarily from the Company’s securities

business activities, including lawsuits, arbitration claims, class actions, and regulatory matters.

Some of these claims may seek substantial

compensatory, punitive, or indeterminate damages.

The Company and its subsidiaries may also be subject to other reviews, investigations,

and proceedings by governmental and self-regulatory organizations regarding the Company’s business, which may result in adverse

judgments, settlements, fines, penalties, injunctions, and other relief.

Due to the inherent difficulty of predicting the outcome of litigation

and other claims the Company cannot state with certainty what the eventual outcome of potential litigation or other claims will be.

Notwithstanding

this uncertainty, the Company does not believe that the results of these potential claims are likely to have a material effect on its

financial position or results of operations.

The Company may be subject to certain legal and

other claims that arise in the ordinary course of its business.

In particular, the Company and its subsidiaries may be named in and subject

to various proceedings and claims arising primarily from the Company’s securities business activities, including lawsuits, arbitration

claims, class actions, and regulatory matters.

Some of these claims may seek substantial compensatory, punitive, or indeterminate damages.

The Company and its subsidiaries may also be subject to other reviews, investigations, and proceedings by governmental and self-regulatory

organizations regarding the Company’s business, which may result in adverse judgments, settlements, fines, penalties, injunctions,

and other relief.

Due to the inherent difficulty of predicting the outcome of litigation and other claims the Company cannot state with

certainty what the eventual outcome of potential litigation or other claims will be.

Notwithstanding this uncertainty, the Company does

not believe that the results of these potential claims are likely to have a material effect on its financial position or results of operations.

In March 2024, the Company received a notice of

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by Rule 15c3-1.

As of June 30, 2024, Dominari Securities had net capital of approximately $ 12.6 million, which was approximately $ 12.4

As of September 30, 2024, Dominari Securities had net capital of approximately $ 12.46 million, which was approximately

$ 12.31 million in excess of net capital requirement of $ 0.15 million.

Related Party Transaction

In 2021, the Company engaged the services of

Revere Securities, LLC (“Revere”) to strategically manage and build the Company’s investment processes.

Board Member, was previously a member of the board of directors of Revere.

The Company incurred fees of approximately $ 0 and $ 80,000

during the six months ending June 30, 2024 and 2023, respectively.

The Company incurred fees of approximately $ 0 and $ 80,000 during the

three months ending June 30, 2024 and 2023, respectively.

In 2021, the Company engaged the services of Revere

Securities, LLC (“Revere”) to assist in the management and building of the Company’s investment processes.

one of the Company’s board members, was previously a member of the board of directors of Revere until June 2023, and currently holds

approximately 30 % of Revere’s outstanding equity.

From time to time, Company participates in offerings of securities as an underwriter

in transactions in which Revere is also participating as an underwriter.

On such transactions, the Company earned $ 313,960 and $ 39,000

in the nine months ending September 30, 2024 and 2023, respectively.

The Company incurred referral fees of approximately $ 45,000 and $ 80,000

during the three months ending September 30, 2024 and 2023, respectively.

These fees were included in general and administrative expenses

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most relied upon by the CODM are gross revenue and net loss, as presented within the table below and reconciled to the statement of operations.

Three Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Dominari Financial

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Total other (expenses) income

Six Months Ended June 30, 2024

Three Months Ended September 30, 2024

Dominari Financial

11 unchanged sentences

The Company recorded no income tax expense for

the three months ended June 30, 2024 and 2023 because the estimated annual effective tax rate was zero.

In determining the estimated annual

effective income tax rate, the Company analyzes various factors, including projections of the Company’s annual earnings and taxing

jurisdictions in which the earnings will be generated, the impact of state and local income taxes, the ability to use tax credits and

net operating loss carry forwards, and available tax planning alternatives.

As of June 30, 2024, and December 31, 2023, the

Company provided a full valuation allowance against its net deferred tax assets since the Company believes it is more likely than not

that its deferred tax assets will not be realized.

the three months ended September 30, 2024 and 2023 because the estimated annual effective tax rate was zero.

In determining the estimated

annual effective income tax rate, the Company analyzes various factors, including projections of the Company’s annual earnings and

taxing jurisdictions in which the earnings will be generated, the impact of state and local income taxes, the ability to use tax credits

and net operating loss carry forwards, and available tax planning alternatives.

As of September 30, 2024, and December 31, 2023,

the Company provided a full valuation allowance against its net deferred tax assets since the Company believes it is more likely than

not that its deferred tax assets will not be realized.

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-Q

Item 1. Financial Statements