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Item 7. Management’s Discussion and Analysis

2025-04-15 compared with 2024-04-01 · 186 added, 220 removed, 17 unchanged (96% of the section changed)

2 unchanged sentences

Forward-Looking Statements

The following Management’s Discussion and Analysis of Financial

Condition and Results of Operations should be read in conjunction with the Company’s consolidated financial statements as of and

for the years ended December 31, 2023 and 2022 and the related notes included in Part II, Item 8 of this Annual Report.

This discussion

contains forward-looking statements, within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act

of 1995, that involve risks and uncertainties.

The Company’s actual results could differ materially from such forward-looking statements.

The Company does not undertake to update, revise or correct any of the forward-looking information unless required to do so under the

federal securities laws.

The following Management’s Discussion

and Analysis of Financial Condition and Results of Operations should be read in conjunction with the Company’s consolidated financial

statements as of and for the years ended December 31, 2024 and 2023 and the related notes included in Part II, Item 8 of this Annual Report.

This discussion contains forward-looking statements, within the meaning of the safe harbor provisions of the Private Securities Litigation

Reform Act of 1995, that involve risks and uncertainties.

The Company’s actual results could differ materially from such forward-looking

The Company does not undertake to update, revise or correct any of the forward-looking information unless required to do so

under the federal securities laws.

Readers are cautioned that such forward-looking statements should be read in conjunction with the Company’s

disclosures under the heading “Special Cautionary Notice Regarding Forward Looking Statements and Risk Factor Summary” included

in this report.

Additionally, the Company’s historical results are not necessarily indicative of the results that may be expected

in any future period.

disclosures under the heading “Special Cautionary Notice Regarding Forward Looking Statements” included in this Annual Report.

Additionally, the Company’s historical results are not necessarily indicative of the results that may be expected in any future

Amounts are presented in U.S.

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forward-looking statements.

Should one or more of a number of known and unknown risks and u ncertainties

materialize, or should any of our assumptions prove incorrect, the Company’s actual results or performance may be materially different

from those expressed or implied by these forward-looking statements.

Factors that could cause actual results to differ include, but are

not limited to, those identified below and those discussed in Part I, Item 1A “Risk Factors” of this Annual Report:

Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is provided in addition

to the accompanying consolidated financial statements and notes to assist readers in understanding our results of operations, financial

condition, and cash flows.

The MD&A is organized as follows:

Discussion of our business and overall analysis of financial and other highlights affecting

the Company in order to provide context for the remainder of the MD&A.

Accounting Estimate.

Accounting estimates we believe are most important to understanding

the assumptions and judgments incorporated in our reported financial results and forecasts.

Issued Accounting Pronouncements.

Should one or more of a number of known and unknown risks and uncertainties materialize, or should any of

our assumptions prove incorrect, the Company’s actual results or performance may be materially different from those expressed or

implied by these forward-looking statements.

Factors that could cause actual results to differ include, but are not limited to, those

identified below and those discussed in Part I, Item 1A “Risk Factors” of this Annual Report:

Our Management’s Discussion and Analysis

of Financial Condition and Results of Operations (“MD&A”) is provided in addition to the accompanying consolidated financial

statements and notes to assist readers in understanding our results of operations, financial condition, and cash flows.

organized as follows:

Discussion of our business and overall analysis of financial and other highlights affecting the Company in order to provide context for the remainder of the MD&A.

Critical Accounting Estimate.

Accounting estimates we believe are most important to understanding the assumptions and judgments incorporated in our reported financial results and forecasts.

Recently Issued Accounting Pronouncements.

A discussion of recent accounting standards.

of Operations.

Results of Operations.

An analysis of our financial results is presented to compare 2024 to 2023.

1 unchanged sentence

Dominari is a holding

company that, through its various subsidiaries, is engaged in wealth management, investment banking, sales and trading and asset management.

In addition to capital investment, Dominari provides management support to the executive teams of its subsidiaries, helping them to operate

efficiently and reduce cost under a streamlined infrastructure.

Dominari Financial, a wholly-owned subsidiary

of Dominari, executes the Company’s growth strategy in the financial services industry.

In addition to organic growth, Dominari

Financial seeks partnership opportunities and acquisitions of third-party financial assets such as registered investment advisors and

businesses, broker dealers, asset management and fintech firms, and insurance brokers.

Our first transaction in furtherance of our growth

in the financial services industry, the acquisition of 100% of a dually-registered broker dealer and investment advisor from Fieldpoint

was consummated on March 27, 2023.

The newly acquired dually registered broker-dealer and investment adviser was renamed Dominari Securities

and is a wholly-owned subsidiary of Dominari Financial.

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

These biotechnology

assets consist of patented technology from leading universities and researchers, including prospective treatments for pancreatic cancer,

acute myeloid leukemia, SARS-CoV-2 and acute lymphoblastic leukemia.

June 7, 2022, the Company effected a seventeen-for-one (17-for-1) reverse stock split of its class of common stock (the “Reverse

Stock Split”).

The Reverse Stock Split, which was approved by stockholders at an annual stockholder meeting on May 20, 2022, was

consummated pursuant to a Certificate of Amendment filed with the Secretary of State of Delaware on June 2, 2022.

The Reverse Stock Split

was effective on June 7, 2022.

All references to common stock, convertible preferred stock, warrants to purchase common stock, options

to purchase common stock, restricted stock units, restricted stock awards, share data, per share data and related information contained

in the consolidated financial statements have been retrospectively adjusted to reflect the effect of the Reverse Stock Split for all

periods presented.

Payment for fractional shares resulting from the reverse stock split amounted to $26,000.

Accounting Estimates

Company accounts for share-based payment awards exchanged for services at the estimated grant date fair value of the award.

Stock options

issued under the Company’s long-term incentive plans are granted with an exercise price equal to no less than the market price

of the Company’s stock at the date of grant and expire up to ten years from the date of grant.

These options generally vest over

a one- to five-year period.

Company estimates the fair value of stock option grants using the Black-Scholes (“Black-Scholes”) option pricing model.

determination of fair value within Black-Scholes involves a number of significant estimates, judgements and assumptions that may affect

the value of employee stock options used in the model.

These include the expected volatility of our stock and employee exercise behavior

which are based on historical data as well as uncertain expectations of future developments over the term of the option.

The assumptions

used in calculating the fair value of stock-based awards represent management’s best estimates and involve inherent uncertainties

and the application of management’s judgment.

The uncertainty of these judgments and assumption could result in significant change

in our stock-based compensation expense amounts in the future.

Term - The expected term of options represents the period that the Company’s stock-based awards are expected to be outstanding

based on the simplified method, which is the half-life from vesting to the end of its contractual term.

Volatility - The Company computes stock price volatility over expected terms based on its historical common stock trading prices.

Interest Rate - The Company bases the risk-free interest rate on the implied yield available on U.

Treasury zero-coupon issues with

an equivalent remaining term.

Dividend - The Company has never declared or paid any cash dividends on its shares of common stock and does not plan to pay cash dividends

in the foreseeable future, and, therefore, uses an expected dividend yield of zero in its valuation models.

Company accounts for forfeitures as they occur.

Value Option - Short-Term Note and Convertible Note

guidance in ASC 825, Financial Instruments , provides a fair value option election that allows entities to make an irrevocable

election of fair value as the initial and subsequent measurement attribute for certain eligible financial assets and liabilities.

Company has elected to measure the purchases of its notes using the fair value option at each reporting date.

Under the fair value option,

bifurcation of an embedded derivative is not necessary, and all related gains and losses on the host contract and derivative due to change

in the fair value will be reflected in interest income and other, net in the consolidated statements of operations.

Interest accrues

on the unpaid principal balance on a quarterly basis and is recognized in interest income in the consolidated statements of operations.

decision to elect the fair value option is determined on an instrument-by-instrument basis and must be applied to an entire instrument

and is irrevocable once elected.

Pursuant to this guidance, assets and liabilities are measured at fair value based, in part, on general

economic and stock market conditions and those characteristics specific to the underlying investments.

The carrying value is adjusted

to estimated fair value at the end of each quarter, required to be reported separately in our consolidated balance sheets from those

instruments using another accounting method.

January 1, 2018, the Company adopted Accounting Standards Update (“ASU”) 2016-01 and related ASU 2018-03 and ASU 2019-04

concerning recognition and measurement of financial assets and financial liabilities.

In adopting this guidance, the Company has made

an accounting policy election to adopt an adjusted cost method measurement alternative for investments in equity securities without readily

determinable fair values.

equity investments that are accounted for using the measurement alternative, the Company initially records equity investments at cost

but is required to adjust the carrying value of such equity investments through earnings when there is an observable transaction involving

the same or a similar investment with the same issuer or upon an impairment.

Our investments are valued at $24 million as of December

In valuing these investments there are judgements and assumptions that may affect the values derived for each security

including the determination of a change in value and whether or not there are indicators of an impairment of value.

These judgments

could impact the estimation uncertainty and the impact of these estimates could have an effect on the financial condition and results

of operations.

Management’s estimates and assumptions include considerations of industry and market conditions and well as uncertain

factors identified specific to each investment that could impact the carrying values.

of new accounting pronouncements not yet adopted

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 is currently evaluating the impact of the amendments on the Company’s consolidated financial statements

and whether it will early adopt the amendments in ASU 2022-03 .

Issued Accounting Pronouncements

Note 3 to the consolidated financial statements for a discussion of recent accounting standards.

of Operations

Year Ended December 31, 2023 Compared to Fiscal Year Ended December 31, 2022

the year ended December 31, 2023, we recognized approximately $2.0 million in revenue from operations, primarily driven by the underwriting

revenue earned by Dominari Securities.

During the years ended December 31, 2023 and 2022, we incurred a loss from operations of approximately

$21.8 million and $14.3 million, respectively.

The increase in loss in operations was primarily attributable to the following:

approximate $12.2 million increase in general and administrative expenses – driven by approximately $0.1 million and $1.9 million

of professional fees (legal, consulting, accounting, etc.) incurred to establish and operate Dominari Financial and Dominari Securities,

respectively.

In addition, the Company also incurred increased compensation expenses of approximately $9.5 million due to growing

approximate $2.7 million decrease in research and development expenses – attributable to the Company’s strategic business

decision to transition away from the biotechnology industry and into financial services.

The result is a decrease in research and

development related expenses by almost 100%.

During the years ended December 31, 2023 and

2022, other expenses was approximately $(1.1) million and $(7.8) million, respectively.

The activity for the years ended December 31,

2023 and 2022, is primarily a result of overall volatility in investment valuations due to macroeconomic uncertainty (i.e.

global tensions in the Ukraine, etc.) impacting marketable securities and the change in fair value of note receivable, and short and

company that, through its various subsidiaries, is primarily engaged in wealth management, investment banking, sales and trading and asset

In addition to capital investment, Dominari provides management support to the executive teams of its subsidiaries,

helping them to operate efficiently and reduce cost under a streamlined infrastructure.

Critical Accounting Estimates

We prepare our consolidated financial statements

in accordance with U.S.

generally accepted accounting principles, which require our management to make estimates that affect the reported

amounts of assets and liabilities and disclosure of contingent assets and liabilities at the balance sheet dates, as well as the reported

amounts of revenues and expenses during the reporting periods.

To the extent that there are material differences between these estimates

and actual results, our financial condition or results of operations would be affected.

We base our estimates on our own historical experience

and other assumptions that we believe are reasonable after taking account of our circumstances and expectations for the future based on

available information.

We evaluate these estimates on an ongoing basis.

We consider an accounting estimate to be critical

(i) the accounting estimate requires us to make assumptions about matters that were highly uncertain at the time the accounting estimate

was made, and (ii) changes in the estimate that are reasonably likely to occur from period to period or use of different estimates that

we reasonably could have used in the current period, would have a material impact on our financial condition or results of operations.

We believe that the following accounting estimates we have identified as critical involve a greater degree of judgment and complexity

than our other accounting estimates.

Accordingly, these are the estimates we believe are the most critical to understanding and evaluating

our consolidated financial condition and results of operations.

Fair Value Option - Short-Term Note and Convertible

The guidance in ASC 825, Financial Instruments ,

provides a fair value option election that allows entities to make an irrevocable election of fair value as the initial and subsequent

measurement attribute for certain eligible financial assets and liabilities.

The Company has elected to measure the purchases of its notes

using the fair value option at each reporting date.

Under the fair value option, bifurcation of an embedded derivative is not necessary,

and all related gains and losses on the host contract and derivative due to change in the fair value will be reflected in interest income

and other, net in the consolidated statements of operations.

Interest accrues on the unpaid principal balance on a quarterly basis and

is recognized in interest income in the consolidated statements of operations.

The decision to elect the fair value option is

determined on an instrument-by-instrument basis and must be applied to an entire instrument and is irrevocable once elected.

to this guidance, assets and liabilities are measured at fair value based, in part, on general economic and stock market conditions and

those characteristics specific to the underlying investments.

The carrying value is adjusted to estimated fair value at the end of

each quarter, required to be reported separately in our consolidated balance sheets from those instruments using another accounting method.

Under this guidance, the Company makes certain

assumptions as to the fair value of the underlying notes.

The primary critical estimate is the credit risk of the underlying companies.

Any future credit risk is not known, as there is uncertainty, and subject to further estimates by the Company.

Additionally, any future

events are not taken into account, which could result in further estimates of the fair value of any outstanding notes.

Long-Term 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

Any equity securities with a readily determinable fair value are included within marketable securities on the accompanying consolidated

balance sheet.

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

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.

The Company, throughout the process of determining if there are any

changes resulting from observable price changes is faced with the risk of estimating certain aspects of its underlying investments.

are limited observable and orderly transactions that are known to the Company, due to the fact that its investments are primarily private

The Company estimates and uses judgments for these underlying investments, that result in uncertainty and estimates which could

result in future changes in the carrying value of the investments.

Additionally, the Company uses any information which is known to them,

which could be from different types of instruments.

Any estimates the Company may use, are its best estimate and may be subject to risk

of further changes.

Effect of new accounting pronouncements not

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 the Company’s

consolidated financial statements.

Recently Issued Accounting Pronouncements

See Note 3 to the consolidated financial statements

for a discussion of recent accounting standards.

Results of Operations

Fiscal Year Ended December 31, 2024 Compared

to Fiscal Year Ended December 31, 2023

During the year ended December 31, 2024, we recognized

approximately $18.1 million in revenue from operations, an increase of approximately $16.1 million as of the year ended December 31, 2023,

primarily driven by the increase in our activities of Dominari Securities.

During the years ended December 31, 2024 and 2023, we incurred

a loss from operations of approximately $11.5 million and $21.8 million, respectively.

The decrease in loss in operations was primarily

attributable to the following:

An approximate $16.1 million increase in revenue from operations, offset

An approximate $5.8 million increase in general and administrative expenses – driven by approximately an increase of $8 million of compensation expenses, due to the growing operations of the Company.

In addition, the Company also had a decrease of approximately $2.4 million of professional fees (legal, consulting, accounting, etc.), which were largely due to the establishment of Dominari Financial and Dominari Securities during the year ended December 31, 2023.

During the years ended December 31, 2024 and 2023, other expenses was

approximately $3.2 million and $1.1 million, respectively.

The activity for the years ended December 31, 2024 and 2023, is primarily a

result of overall volatility in investment valuations due to macroeconomic uncertainty (i.e.

inflation, global tensions in the Ukraine,

etc.) impacting marketable securities and the change in fair value of note receivable, and long-term investments.

Specifically:

securities – we recognized a gain of approximately $0.6 million for the year ended December 31, 2023.

The decrease of approximately

$6.6 million in losses over the prior period is a direct result of a decrease in unrealized losses of approximately $6.0 million,

an increase in dividend income of approximately $0.4 million and a decrease in realized loss of approximately $0.2 million.

The decreases

were driven by both market improvement and a decrease in sale activity resulting in fewer realized losses.

receivable – the changes over the years ended December 31, 2023 and 2022 are a function of observable market transactions which

resulted in an increase in unrealized loss of approximately $3.2 million on the adjusted fair value of the note receivable during

the year ended December 31, 2023.

and long-term investments – the changes over the years ended December 31, 2023 and 2022 are a function of observable market

transactions which resulted in an increase in unrealized gain of approximately $3.3 million on the adjusted fair value of the investments

Marketable securities – we recognized a gain of approximately $5.2 million for the year ended December 31, 2024.

The increase of approximately $4.6 million in gains over the prior period is a result of additional activities during the year as we expanded.

Change in carrying value of long term investments – we recognized

a change in carrying value of long term investments of $(7.1) million for the year ended December 31, 2024.

During the year ended December

and Capital Resources

continue to incur ongoing administrative and other expenses, including public company expenses.

While we continue to implement our business

strategy, we intend to finance our activities through:

current cash and cash equivalents on hand from our past debt and equity offerings;

additional funds raised through the sale of additional securities in the future;

additional liquidity through credit facilities or other debt arrangements.

Our ultimate success is dependent on our ability

to generate sufficient cash flow to meet our obligations on a timely basis.

Our business may require significant amounts of capital to

sustain operations that we need to execute our business plan to support our transition into the financial services industry.

capital amounted to approximately $26.5 million as of December 31, 2023.

We believe our cash and cash equivalents and marketable securities,

together with the anticipated cash flow from operations will be sufficient to meet our working capital and capital expenditure requirements

for at least the next 12 months.

In the event that cash flow from operations is not sufficient to fund our operations, as expected, or

if our plans or assumptions change, including if inflation begins to have a greater impact on our business or if we decide to move forward

with any activities that require more outlays of cash than originally planned, we may need to raise additional capital sooner than expected.

We may raise this additional capital by obtaining additional debt or equity financing, especially if we experience downturns in our business

that are more severe or longer than anticipated, or if we experience significant increases in expense levels resulting from being a publicly

traded company or from continuing operations.

ability to obtain capital to implement our growth strategy over the longer term will depend on our future operating performance, financial

condition and, more broadly, on the availability of equity and debt financing.

Capital availability will be affected by prevailing conditions

in our industry, the global economy, the global financial markets, and other factors, many of which are beyond our control.

Specifically,

as a result of recent volatility and weakness in the public markets, due to, among other factors, uncertainty in the global economy and

financial markets, it may be much more difficult to raise additional capital, if and when it is needed, unless the public markets become

less volatile and stronger at such time that we seek to raise additional capital.

In addition, any additional debt service requirements

we take on could be based on higher interest rates and shorter maturities and could impose a significant burden on our results of operations

and financial condition, and the issuance of additional equity securities could result in significant dilution to stockholders.

Flows from Operating Activities

31, 2023, we recognized a change in carrying value of long term investments of $0.8 million.

This change of approximately $7.8 million

was the direct result of the Company writing down additional investments due to performance during the year ending December 31, 2024.

Note receivable – the changes over the years ended December 31, 2024 and 2023 are a function of observable market transactions which resulted in a decrease in unrealized loss of approximately $0.9 million on the adjusted fair value of the note receivable during the year ended December 31, 2024, as well as a realized loss of $2.1 million on an uncollectible note.

Liquidity and Capital Resources

We continue to incur ongoing administrative and

other expenses, including public company expenses.

While we continue to implement our business strategy, we intend to finance our activities

managing current cash and cash equivalents on hand from our past debt and equity offerings;

seeking additional funds raised through the sale of additional securities in the future;

seeking additional liquidity through credit facilities or other debt arrangements.

Our ultimate success is dependent on our

ability to generate sufficient cash flow to meet our obligations on a timely basis.

Our business may require significant amounts of

capital to sustain operations that we need to execute our business plan to support our transition into the financial services

Our working capital amounted to approximately $24.4 million as of December 31, 2024.

As of December 31, 2024, we had

approximately $4 million of cash and cash equivalents and $5.8 million of marketable securities.

Additionally, we had approximately

$17 million in receivable from clearing brokers.

Subsequent to December 31, 2024, we raised approximately $13.5 million.

funds are available to fund our operations.

We believe our cash and cash equivalents and marketable securities, together with the

anticipated cash flow from operations will be sufficient to meet our working capital and capital expenditure requirements for at

least the next 12 months.

In the event that cash flow from operations is not sufficient to fund our operations, as expected, or if

our plans or assumptions change, including if inflation begins to have a greater impact on our business or if we decide to move

forward with any activities that require more outlays of cash than originally planned, we may need to raise additional capital

sooner than expected.

We may raise this additional capital by obtaining additional debt or equity financing, especially if we

experience downturns in our business that are more severe or longer than anticipated, or if we experience significant increases in

expense levels resulting from being a publicly traded company or from continuing operations.

Our ability to obtain capital to implement our

growth strategy over the longer term will depend on our future operating performance, financial condition and, more broadly, on the availability

of equity and debt financing.

Capital availability will be affected by prevailing conditions in our industry, the global economy, the

global financial markets, and other factors, many of which are beyond our control.

Specifically, as a result of recent volatility and

weakness in the public markets, due to, among other factors, uncertainty in the global economy and financial markets, it may be much more

difficult to raise additional capital, if and when it is needed, unless the public markets become less volatile and stronger at such time

that we seek to raise additional capital.

In addition, any additional debt service requirements we take on could be based on higher interest

rates and shorter maturities and could impose a significant burden on our results of operations and financial condition, and the issuance

of additional equity securities could result in significant dilution to stockholders.

Cash Flows from Operating Activities

For the years ended December 31, 2024 and 2023, net cash used in operations

was approximately $15.1 million and $22.2 million, respectively.

The cash used in operating activities for the year ending December 31,

2024, is primarily attributable to a net loss of approximately $14.7 million, change in carrying value of long-term investment of approximately

$7.1 million, stock-based compensation of approximately $1.6 million, realized gain on marketable securities of approximately $6.4 million,

unrealized loss on marketable securities of approximately $1.7 million, realized and unrealized loss on note receivable of approximately

$2.3 million and changes in operating assets and liabilities of approximately $7 million.

The cash used in operating activities for the

year ending December 31, 2023, is primarily attributable to a net loss of approximately $22.9 million, approximately $1.0 million of unrealized

gain on marketable securities, change in fair value of long-term investment of approximately $0.8 million and changes in operating assets

and liabilities of $5.3 million, partially offset by $3.0 million stock-based compensation expense, approximately $3.2 million in unrealized

losses on note receivable and approximately $1.2 million in realized losses on marketable securities.

Cash Flows from Investing Activities

For the years ended December 31, 2024 and 2023,

net cash used in operations was approximately $22.2 million and $10.6 million, respectively.

The cash used in operating activities for

the year ending December 31, 2023, is primarily attributable to a net loss of approximately $22.9 million, approximately $1.0 million

of unrealized gain on marketable securities, change in fair value of long-term investment of approximately $0.8 million and changes in

operating assets and liabilities of $5.3 million, partially offset by $3.0 million stock-based compensation expense, approximately $3.2

million in unrealized losses on note receivable and approximately $1.2 million in realized losses on marketable securities.

used in operating activities for the year ending December 31, 2022, is primarily attributable to a net loss of approximately $22.1 million.

The net loss was slightly offset by approximately $4.9 million in unrealized losses on marketable securities, approximately $2.6 million

relating to the change in fair value of short-term investments, approximately $1.8 million in research and development expense related

to acquired licenses, approximately $1.5 million related to stock-based compensation, and approximately $1.4 million of realized loss

on marketable securities.

Flows from Investing Activities

the years ended December 31, 2023 and 2022, net cash used in investing activities was approximately $7.2 million and $14.6 million, respectively.

The cash used in investing activities for the year ended December 31, 2023, primarily resulted from our purchase of marketable securities

of approximately $34.1 million and the acquisition of FPS for approximately $1.1 million, partially offset by our sale of marketable

securities of approximately $27.6 million and collection of principal on note receivable of approximately $1.1 million.

net cash provided by and (used in) investing activities was approximately $16.3 million and ($7.2) million, respectively.

The cash provided

by investing activities for the year ended December 31, 2024, primarily resulted from our purchase of marketable securities of approximately

$7.8 million, partially offset by our sale of marketable securities of approximately $21.2 million, sale of long-term investments of $4.3

million, loans to employees of $2.4 million and collection of principal on note receivable of approximately $1 million.

The cash used

in investing activities for the year ended December 31, 2023, primarily resulted from our purchase of marketable securities of approximately

$26.8 million, purchase of investments of approximately $15.0 million, purchase of research and development licenses of approximately

$1.8 million, and the purchase of promissory notes of approximately $1.6 million, partially offset by our sale of marketable securities

of approximately $28.7 million since we invest excess cash into marketable securities until additional cash is needed.

Flows from Financing Activities

the year ended December 31, 2023, cash used in financing activities was approximately $0.9 million, which reflects the cost for the purchase

of treasury stock of approximately $0.9 million.

For the year ended December 31, 2022, cash used in financing activities was approximately

$7.2 million, which reflects the cost for redemption of Series O and Series P Redeemable Convertible Preferred Stock of approximately

$22.0 million and cost for purchase of treasury stock of approximately $3.1 million, partially offset by net proceeds of approximately

$17.9 million from investors in exchange of issuance of issuance of Series O and Series P Redeemable Convertible Preferred Stock.

the year ended December 31, 2021, cash provided by financing activities was approximately $78.2 million, which is primarily attributable

to the approximate $78.2 million from investors in exchange of issuance of common stock and warrants.

$34.1 million and the acquisition of FPS for approximately $1.1 million, partially offset by our sale of marketable securities of approximately

$27.6 million and collection of principal on note receivable of approximately $1.1 million.

Cash Flows from Financing Activities

For the years ended December 31, 2024 and 2023,

net cash used in financing activities was $0 and approximately $0.9 million, which reflects the cost for the purchase of treasury stock.

Contractual obligations

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 7. Management’s Discussion and Analysis