Item 1. Business
Item 1. BUSINESS
Dominari Holdings Inc. (“Dominari”)
is a holding company that, through its various subsidiaries, is engaged in wealth management, investment banking, sales and trading, asset
management and insurance. 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 and its subsidiaries are collectively
referred to herein as “Company,” “we,” “our” or “us.”
Dominari Financial Inc. (“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 Private Bank & Trust (“Fieldpoint”), was consummated on March 27, 2023. The newly acquired dually
registered broker-dealer and investment adviser was renamed Dominari Securities LLC (“Dominari Securities”) and is a wholly
owned subsidiary of Dominari Financial.
History
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 Dominari Labs, LLC (formerly 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, a member of the Financial Industry Regulatory Authority (“FINRA”) and an
investment adviser registered with the Securities and Exchange Commission (“SEC”). Dominari Securities is also licensed to
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 (“Fieldpoint”), 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, a member of FINRA and an
investment advisor registered with the SEC. Pursuant to the terms of the FPS Purchase Agreement, Dominari Financial purchased from Fieldpoint
100% of the membership interests in FPS (the “Membership Interests”). The registered broker-dealer and investment adviser
businesses will be operated as a wholly owned subsidiary of Dominari Financial. The FPS Purchase Agreement provided 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 Fieldpoint $2.0 million in consideration for a transfer by Fieldpoint to Dominari Financial 20% of
the 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”).
The Rule 1017 Application was approved by FINRA on March 20, 2023. The second closing occurred on March 27, 2023, Dominari Financial paid
Fieldpoint an additional $1.4 million in consideration for a transfer by Fieldpoint to Dominari Financial of the remaining 80% of the
Membership Interests. As a result of the ownership change, FPS was renamed Dominari Securities LLC.
On 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 financial statements of Dominari. 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. 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 June 17, 2025, the Company entered into two
Limited Liability Agreements with American Ventures Management LLC (“AV Manager”) and American Ventures IM LLC (“AV
Investment Manager”). The Company holds a ninety percent (90%) Membership Interest in each, and their operations are included within
the consolidated financial statements of Dominari. AV Manager was named as the manager of American Ventures LLC (the “AV Master
SPV”), a series limited liability company formed by AV Manager and owned by the investors of each fund series, and is responsible
for the day-to-day operations of the AV Master SPV. AV Investment Manager was named the investment manager of the AV Master SPV and is
responsible for providing investment advice and decisions on behalf of the AV Master SPV. AV Manager and AV Investment Manager are the
managing members of AV Master SPV and may not be removed without their respective consent. The other members of AV Master SPV are the
passive investing members of each series of funds (the “AV Series”) established under the AV Master SPV. The AV Manager established
various AV Series of the AV Master SPV for the purpose of making investments in companies identified by the AV Investment Manager with
proceeds generated by the sale of non-voting interests in such AV Series by the AV 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.
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Dominari Securities
Dominari Securities offers, and plans to offer,
a broad range of broker-dealer and registered investment adviser services. Those services are discussed below and include wealth management,
investment banking, sales and trading, asset management and insurance products.
Wealth Management Services
Dominari Securities provides a comprehensive array
of financial services to high-net-worth individuals and families, corporate executives, and public and private businesses. Clients are
able to choose a variety of ways to establish a relationship and conduct business, including by establishing brokerage accounts with transaction-based
pricing and/or investment advisory accounts with asset-based fee pricing. Dominari Securities also provides the following private client
services:
Full-Service Brokerage . Dominari Securities
offers full-service brokerage services covering investment alternatives, including exchange-traded and over-the-counter corporate equity
and debt securities, money market instruments, exchange-traded options, municipal bonds, mutual funds, exchange-traded funds, and unit
investment trusts.
Wealth Planning . Dominari Securities offers
financial and wealth planning services, which include asset management, individual and corporate retirement solutions, insurance and annuity
products, IRAs and 401(k) plans, U.S. stock plan services to corporate executives and businesses, education savings programs, and trust
and fiduciary services to individual and corporate clients through third-party trust companies.
Investment Banking
Dominari Securities’ investment banking
division provides strategic advisory services and capital markets products to emerging growth and middle market businesses. The investment
banking groups focus on the consumer and retail, energy, financial institutions, healthcare, rental services, technology, education, and
transportation and logistics sectors. Investment banking services include:
Financial Advisory . Dominari Securities
advises buyers and sellers on sales, divestitures, mergers, acquisitions, tender offers, privatizations, spin-offs, joint ventures, restructurings
and liability management.
Equities Capital Markets . Dominari Securities
provides capital raising solutions for corporate, institutional, and qualifying retail clients through initial public offerings, follow-on
offerings, confidentially marketed public offerings, registered directs, private investments in public equity, private placements, at-the-market
offerings, and equity-linked offerings.
Debt Capital Markets . Dominari Securities
plans to offer debt capital markets solutions for emerging growth and middle market companies. Dominari Securities will focus on structuring
and distributing public and private debt through financing transactions, including leveraged buyouts, acquisitions, growth capital financings,
recapitalizations and Chapter 11 exit financings. Dominari Securities expects to also participate in high yield debt and fixed and floating-rate
senior and subordinated debt offerings in the future.
Fund Placement . Dominari Securities provides
alternative investment firms with a broad and deep portfolio of value-added services. Services include bespoke strategic and tactical
advisory as well as primary fundraises, co-investments and direct transactions.
Debt Advisory & Restructuring . Dominari
Securities expects to offer creative solutions to leveraged corporate issuers and credit investors. We will evaluate a full range of strategic
alternatives, identify the appropriate structure and source of funds to provide our clients the ability to pursue an optimal and value
maximizing outcome.
Private Equity : Dominari Securities offers
private equity investments through special purpose vehicles (“SPVs”) which allows investors to pool capital into specific
investment projects while managing risk and liability. Dominari Securities structures and manages the SPVs, providing investors access
to high-quality private equity opportunities in both early and late stage emerging technology, med-tech, defense, and artificial intelligence
(“AI”) sectors, among others. This model offers transparency, tailored investment structures, and ongoing management, making
it an attractive option for institutional investors, high-net-worth individuals, and accredited investors seeking alternative investments.
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Sales and Trading
Dominari Securities provides a broad range of
sales and trading services to our clients. Sales and trading services include:
Institutional Equity Sales and Trading .
Dominari Securities acts as an agent in the execution of its customers’ orders through our strategic clearing partners.
Equity Derivatives and Index Options . Dominari
Securities offers listed equity and index options strategies for investors seeking to manage risk and optimize returns within the equities
market.
Institutional Fixed Income Sales and Trading .
Dominari Securities offers trading in public and private debt (including sovereign debt) securities, including investment and non-investment
grade, distressed and convertible corporate securities through our clearing partners.
Securities Lending . In connection with
both its trading and brokerage activities, Dominari Securities, through its clearing relationships, borrows securities to cover short
sales and to complete transactions in which customers have failed to deliver securities by the required settlement date and lend securities
to other brokers and dealers for similar purposes. Dominari Securities expects to earn interest on its cash collateral provided and pay
interest on the cash collateral received less a rebate earned for lending securities.
Asset Management
Dominari Securities offers discretionary and non-discretionary
fee-based programs to provide tailored investment management solutions and services to high-net-worth private clients, institutions and
corporations and/or plans sponsored by them. These include, but are not limited to, portfolio management, manager research and due diligence
through third party partners, asset allocation advice and financial planning. Dominari Securities offers portfolio management strategies
and third-party investment management capabilities through separately managed accounts, alternative investments and discretionary and
non-discretionary portfolio management programs as well as managed portfolios of mutual funds. Platform support functions can include
sales and marketing along with administrative services such as trade execution, client services, records management and client reporting
and performance monitoring. Dominari Securities generates revenues through the receipt of investment advisory and transactional fees for
advisory services and from fees earned through sharing arrangements with registered and private alternative investment vehicles. Dominari
Securities also earns investment advisory fees on assets held in discretionary and non-discretionary asset-based programs. These fees
are billed monthly in advance and are calculated based on all fee-based assets under management balances at the end of the prior month.
Dominari Securities also earns income from revenue-sharing arrangements that are derived from management and incentive fees on alternative
investments and calculates these on a pre-determined basis with registered and private investment companies. The Company’s asset
management services include:
Separately Managed Accounts . Dominari Securities
provides clients with fee-based programs: (i) a unified managed account which allows multiple investment managers, mutual funds and exchange-traded
funds to be combined in a single custodial account; and (ii) an asset review dual contract program designed for clients seeking a direct
contractual relationship with investment managers.
Discretionary Advisory Accounts . Dominari
Securities offers client-focused discretionary fee-based investment programs managed by Dominari Securities advisors.
Non-Discretionary Advisory Accounts . Dominari
Securities provides fee-based non-discretionary investment advisory services and consultation to clients.
Alternative Investments . Dominari Securities
offers high net worth and institutional investors the opportunity to participate in a wide range of non-traditional investment strategies.
Strategies include single manager hedge funds, fund of funds, diversified private equity funds and single investment late-stage private
equity funds.
Private Market Platform . Through
a collaborative effort among the Company’s business units, Dominari Securities’ private market platform focuses on sourcing
private investments across various sectors. Transactions are expected to cover the full spectrum of private investments, including early
stage, late stage, direct, co-investments, funds and secondary market transactions in debt, equity and hybrid securities.
Insurance
Dominari Securities maintains direct selling agreements
with select insurance companies and field market offices, offering additional products and services to advisors with the required insurance
licensing. These agreements provide access to a range of financial products, including life insurance, annuities, retirement solutions,
and variable annuities. In addition, insurance companies offer client servicing, underwriting assistance, and technology platforms for
policy management. These partnerships allow Dominari to deliver comprehensive financial solutions while receiving compensation and ongoing
support from the insurance companies.
Dominari Financial Heritage Strategies .
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.
DFHS offers business property and casualty insurance,
family office services, group medical insurance, life insurance, personal property and casualty insurance, private placement life insurance,
and qualified plans.
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Recent Developments
Dividend Paid
On December 11, 2025, the Company declared a special
cash dividend on our common stock and pursuant to the terms of certain common stock purchase warrants issued in our recently completed
financings (on an as-exercised basis) of $0.432 per share, which was paid on January 26, 2026, to shareholders and certain warrant holders
of record as of the close of business on January 5, 2026.
Sale of ABTC Stock
On December 30, 2025, the Company entered into
an agreement to sell the entirety of its 23,199,205 shares of ABTC common stock for proceeds totaling $32.4 million. The transaction closed
on January 20, 2026, with the receipt of the totality of the $32.4 million.
Restricted Stock Awards
On January 7, 2026, in connection with the transaction
involving the Company’s investment in American Bitcoin, the Committee determined that it is in the best interests of the Company
and its stockholders, to make a special equity grant to Messrs. Anthony Hayes and Kyle Wool, in accordance with the Company’s 2022
Equity Incentive Plan (the “2022 Plan”) and pursuant to stockholder approval to increase the number of shares of common stock
reserved for issuance under the 2022 Plan. Pursuant to the Committee’s decision and upon stockholder approval, pursuant to which
each received 3,000,000 shares of the Company’s common stock.
On March 4, 2026, upon approval of the Company’s
stockholders to amend the 2022 Plan to increase the number of shares of common stock reserved for issuance under the 2022 Plan, the shares
were fully-vested and nonforfeitable with a total fair value of approximately $18.4 million.
Special Meeting of Stockholders
On March 4, 2026, at a special meeting of stockholders,
the Company’s stockholders approved amendments to (1) increase the number of shares of common stock reserved for issuance with respect
to awards granted under the 2022 Plan by 10,000,000 shares of common stock from 11,720,750 shares of common stock to 21,720,750 shares
of common stock and (2) Section 4(b) of the 2022 Plan to clarify the calculation of the annual increase in shares of common stock reserved
for issuance under the 2022 Plan to provide that commencing on January 1, 2027 and continuing until January 1, 2032, the number of shares
reserved for issuance under the 2022 Plan shall automatically increase each January 1 st , by a number of shares equal to the
lesser of (i) 20% of the total number of shares of common stock issued and outstanding on the immediately preceding December 31 st
and (ii) such smaller number of shares of common stock as determined by the board of directors.
Amendments to Employment Agreements with Officers
On March 20, 2026, the Company entered into amendments to the employment agreements of each of Anthony Hayes
(the Company’s Chief Executive Officer), and Kyle Wool (the Company’s President) (collectively, the “Employment Agreement
Amendments”). Pursuant to each of the Employment Agreement Amendments, the executives agreed to replace the annual bonus provisions
with a performance-based quarterly bonus in consideration for the issuance of 3,000,000 shares of common stock from the Company, as approved
by vote of the shareholders of the Company on March 4, 2026.
Regulation
Regulation in the United States
The financial services industry in which we operate
is subject to extensive regulation. In the U.S., the SEC is the federal agency responsible for the administration of federal securities
laws. In addition, the Financial Industry Regulatory Authority, Inc. (“FINRA”) is a self-regulatory organization (“SRO”)
that is actively involved in the regulation of securities businesses. In addition to federal regulation, we are subject to state securities
regulations in each state and U.S. territory in which we conduct securities or investment advisory activities. The SEC, FINRA, and state
securities regulators conduct periodic examinations of broker-dealers and investment advisors. The designated examining authority under
the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”) for Dominari Securities’ activities as a broker-dealer
is FINRA. Financial services businesses are also subject to regulation and examination by state securities regulators and attorneys general
in those states in which they do business. In addition, broker-dealers and investment advisors must also comply with the rules and regulation
of clearing houses, exchanges, and trading platforms of which they are a member.
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Broker-dealers are subject to SEC, FINRA, and
state securities regulations that cover all aspects of the securities business, including sales and trading methods, trade practices among
broker-dealers, use and safekeeping of customers’ funds and securities, capital structure and requirements, anti-money laundering
efforts, recordkeeping and the conduct of broker-dealer personnel including officers and employees (although state securities regulations
are, in a number of cases, more limited). Registered investment advisors are subject to, among other requirements, SEC regulations concerning
marketing, transactions with affiliates, custody of client assets, disclosures to clients, conflict of interest, insider trading and recordkeeping.
Additional legislation, changes in rules promulgated by the SEC, FINRA, and other SROs of which the broker-dealer is a member, and state
securities regulators, or changes in the interpretation or enforcement of existing laws or rules may directly affect the operations and
profitability of broker-dealers and investment advisors. The SEC, FINRA, and state securities regulators and state attorneys general may
conduct administrative proceedings or initiate civil litigation that can result in adverse consequences for Dominari Securities, its affiliates,
including affiliated investment advisors, as well as its and their officers and employees (including, without limitation, injunctions,
censures, fines, suspensions, directives that impact business operations (including proposed expansions), membership expulsions, or revocations
of licenses and registrations).
DFHS is licensed to transact insurance business
in New York. DFHS is subject to extensive regulation and supervision by insurance regulators in New York and its state of domicile, Delaware.
The extent of regulation by jurisdiction varies, but most jurisdictions have laws and regulations governing the financial aspects and
business conduct of insurers. State laws in the United States grant insurance regulatory authorities broad administrative powers with
respect to, among other things, licensing companies to transact business, sales practices, establishing statutory capital and reserve
requirements and solvency standards, reinsurance and hedging, protecting privacy, regulating advertising, restricting the payment of dividends
and other transactions between affiliates, permitted types and concentrations of investments and business conduct to be maintained by
insurance companies as well as agent and insurance producer licensing, and, to the extent applicable to the particular type of insurance,
approval or filing of policy forms and rates. Insurance regulators have the discretionary authority to limit or prohibit new issuances
of business to policyholders within their jurisdictions when, in their judgment, such regulators determine that the issuing company is
not maintaining adequate statutory surplus or capital.
Supervisory agencies in each of the jurisdictions
in which DFHS does business may conduct regular or targeted examinations of its operations and accounts and make requests for particular
information. From time to time, regulators raise issues during examinations or audits that could, if determined adversely, or if they
result in an enforcement action, have a material adverse effect. In addition, new laws and regulations and changed interpretations of
existing regulations and laws by regulators may adversely impact DFHS’s business and the impact could be more adverse in the case
of statutes, regulations or guidance enacted or adopted with retroactive impact, particularly in areas such as accounting or statutory
reserve requirements.
SEC Regulation Best Interest (“Reg BI”)
requires that a broker-dealer and its associated persons act in a retail customer’s best interest and not place their own financial
or other interests ahead of a retail customer’s interests when recommending securities transactions or investment strategies, including
recommendations of types of accounts. To meet this best interest standard, a broker-dealer must satisfy four component obligations including
a disclosure obligation, a care obligation, a conflict of interest obligation, and a compliance obligation and both broker-dealers and
investment advisors are required to provide disclosures about their standard of conduct and conflicts of interest.
The investment advisers responsible for the Company’s
investment management businesses are all registered as investment advisers with the SEC or rely upon the registration of an affiliated
adviser. Registered investment advisers are subject to the requirements of the Investment Advisers Act of 1940 and the regulations promulgated
thereunder. Such requirements relate to, among other things, fiduciary duties to clients, maintaining an effective compliance program,
operational and marketing requirements, disclosure obligations, conflicts of interest, fees and prohibitions on fraudulent activities.
In addition, certain states, have proposed or
adopted measures that would make broker-dealers, sales agents and investment advisors and their representatives subject to a fiduciary
duty when providing products and services to customers. The SEC did not indicate an intent to pre-empt state regulation in this area,
and some of the state proposals would allow for a private right of action. In the event our wealth management division makes recommendations
to retail customers, it will be required to comply with the obligations imposed under Reg BI and applicable state laws.
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Regulatory Capital Requirements
Dominari Securities is subject to financial capital
requirements that are set by regulation. Dominari Securities is a registered broker-dealer and is required to maintain net capital in
an amount equal to SEC minimum financial requirements. As a broker-dealer, Dominari Securities is subject to the SEC’s Uniform Net
Capital Rule 15c3-1 (the “Net Capital Rule”). Compliance with the Net Capital Rule could limit Dominari Securities’
operations, such as underwriting and trading activities and financing customers’ prime brokerage or other margin activities, in
each case, that could require the use of significant amounts of capital, limit its ability to engage in certain financing transactions,
such as repurchase agreements, and may also restrict its ability (i) to make payments of dividends, withdrawals or similar distributions
or payments to a stockholder/parent or other affiliate, (ii) to make a redemption or repurchase of shares of stock, or (iii) to make an
unsecured loan or advance to such stockholders or affiliates.
Under the Exchange Act, state securities regulators
are not permitted to impose capital, margin, custody, financial responsibility, making and keeping records, bonding, or financial or operational
reporting requirements on registered broker-dealers that differ from, or are in addition to, the requirements in those areas established
under the Exchange Act, including the rules and regulations promulgated thereunder.
Regulation outside the United States
In the event Dominari Securities provides financial
services internationally, it will be subject to extensive regulations proposed, promulgated and enforced by, among other regulatory bodies,
the European Commission and European Supervisory Authorities (including the European Banking Authority and European Securities and Market
Authority), U.K. Financial Conduct Authority, German Federal Financial Supervisory Authority (“BaFin”), Investment Industry
Regulatory Organization of Canada, Hong Kong Securities and Futures Commission, the Japan Financial Services Agency, the Monetary Authority
of Singapore, and the Australian Securities and Investments Commission. Every country in which we may do business will impose upon us
laws, rules and regulations similar to those in the U.S., including with respect to some form of capital adequacy rules, customer protection
rules, data protection regulations, anti-money laundering and anti-bribery rules, compliance with other applicable trading and investment
banking regulations and similar regulatory reform.
Competition
All aspects of our business are, and are expected
to be, intensely competitive. We compete primarily with small to mid-size bank holding companies that engage in wealth management, investment
banking and capital markets activities as one of their lines of business and that have greater capital and resources than we do. We also
compete against other broker-dealers, asset managers and boutique firms. We believe the principal factors that will drive our competitiveness
in the future will include our ability to: provide differentiated insights to our clients that lead to better business outcomes; attract,
retain and develop skilled professionals; deliver a competitive breadth of high-quality service offerings; and maintain an entrepreneurial
culture built on immediacy and client service.
Employees
As of December 31, 2025, we had 36 full-time employees,
none of which are represented by a labor union or covered by a collective bargaining agreement. The Company offers health insurance benefits
to eligible employees. Additional benefits offered by the Company depend on the employee position and title, but may include a 401(k)
retirement plan, short-term disability, Workers’ Compensation for qualifying illness or injury, sick leave and paid vacation. The
Company also provides certain training for employees, such as New York State Harassment Prevention Training, Cyber Security Awareness
Training and some continuing education training.
Corporate Information
We were incorporated in Delaware on May 1, 1992.
Our principal office is located at 725 5th Avenue, 22 nd Floor, New York, New York 10022, and our telephone number is (212)
393-4540. Our website address is https://www.dominariholdings.com/ . The information contained in, or accessible through, our website
does not constitute part of this Annual Report. We have included our website address as an inactive textual reference only.
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