XML 27 R16.htm IDEA: XBRL DOCUMENT
v3.25.2

Stockholders’ Equity and Convertible Preferred Stock | 6 Months Ended
--- | ---
Jun. 30, 2025
Stockholders’ Equity and Convertible Preferred Stock [Abstract] |
Stockholders’ Equity and Convertible Preferred Stock | Note 10. Stockholders’ Equity and Convertible Preferred Stock Common Stock As of June 30, 2025, there are 15,295,930 shares of common stock issued and 15,235,782 shares outstanding. On February 10, 2025, the Company entered into securities purchase agreements with certain accredited investors for the sale by the Company of 1,439,467 registered shares of its common stock, and the same amount of unregistered Series A warrants and unregistered Series B warrants were issued at a combined purchase price of $3.47 per share and accompanying warrants in a direct offering. In a concurrent private placement, the Company entered into securities purchase agreements with certain accredited investors for the sale of 2,436,587 unregistered shares of common stock, and the same amount of unregistered Series A warrants and unregistered Series B warrants were issued at a combined purchase price of $3.47 per share and accompanying warrants (the “February 2025 Financings”). The Series A warrants are exercisable immediately upon issuance at an exercise price of $3.72 per share and will expire five years from the date of issuance. The Series B warrants are exercisable immediately upon issuance at an exercise price of $4.22 per share and will expire five years from the date of issuance. The net proceeds to the Company from the February 2025 Financings were approximately $13.5 million. On February 10, 2025, the Company entered into advisory agreements with various individuals who were issued shares of common stock. The agreements are for a term of two years but are cancellable by either party. As part of these agreements, 2,550,000 shares of common stock were issued on February 18, 2025. An additional 850,000 shares may be issued under the terms of the agreements when certain provisions are met which as of the date of grant is probable. These shares are nonforfeitable and thus were fully expensed by the Company at the time of grant. The Company used a Monte Carlo simulation to calculate the grant date fair value of the common stock. The fair value of issued shares amounted to $20,944,000 and is presented in general and administrative expenses on the consolidated statement of operations.
The following were assumptions used in the Company’s fair value analysis: |  |  |
Risk-free interest rate |  |  | 4.14 | %
Estimated maturity date |  |  | 10 years |
Underlying stock price |  |  | 6.16 |
Expected volatility |  |  | 112.5 | %
The securities in the concurrent private placement were offered under Section 4(a)(2) of the Securities Act and Regulation D promulgated thereunder and, along with the shares of common stock underlying such warrants, have not been registered under the Securities Act or applicable state securities laws. Accordingly, the unregistered shares, the warrants, and the shares of common stock underlying the warrants may not be offered or sold in the United States absent registration with the SEC or an applicable exemption from such registration requirements. Certain officers, directors, employees and members of the Company’s advisory board participated in the February 2025 Financings on the same terms as the other investors. During the period April 1, 2025 to June 30, 2025 warrants were exercised by various individuals resulting in additional common stock issuance of 591,885 shares generating cash proceeds of $2.3 million which is included in additional paid-in capital on the statement of equity. Series D Convertible Preferred Stock In connection with the acquisition of North South’s patent portfolio in September 2013, the Company issued 1,379,685 shares of its Series D Convertible Preferred Stock (“Series D Preferred Stock”) to the stockholders of North South. Each share of Series D Preferred Stock has a stated value of $0.0001 per share and is convertible into 10 over 1,373 of a share of Common Stock. Upon the liquidation, dissolution or winding up of the Company’s business, each holder of Series D Preferred Stock shall be entitled to receive, for each share of Series D Preferred Stock held, a preferential amount in cash equal to the greater of (i) the stated value or (ii) the amount the holder would receive as a holder of Common Stock on an “as converted” basis. Each holder of Series D Preferred Stock shall be entitled to vote on all matters submitted to its stockholders and shall be entitled to such number of votes equal to the number of shares of Common Stock such shares of Series D Preferred Stock are convertible into at such time, taking into account the beneficial ownership limitations set forth in the governing Certificate of Designation and the conversion limitations described below. The conversion ratio of the Series D Preferred Stock is subject to adjustment in the event of stock splits, stock dividends, combination of shares and similar recapitalization transactions. As of June 30, 2025 and December 31, 2024, 5,000,000 Series D Preferred Stock was designated; 3,825 and 3,825 shares remained issued and outstanding. Series D-1 Convertible Preferred Stock The Company’s Series D-1 Convertible Preferred Stock (“Series D-1 Preferred Stock”) was established on November 22, 2013. Each share of Series D-1 Preferred Stock has a stated value of $0.0001 per share and is convertible into 10 over 1,373 of a share of Common Stock. Upon the liquidation, dissolution or winding up of the Company’s business, each holder of Series D-1 Preferred Stock shall be entitled to receive, for each share of Series D-1 Preferred Stock held, a preferential amount in cash equal to the greater of (i) the stated value or (ii) the amount the holder would receive as a holder of Common Stock on an “as converted” basis. Each holder of Series D-1 Preferred Stock shall be entitled to vote on all matters submitted to the Company’s stockholders and shall be entitled to such number of votes equal to the number of shares of Common Stock such shares of Series D-1 Preferred Stock are convertible into at such time, taking into account the beneficial ownership limitations set forth in the governing Certificate of Designation. The conversion ratio of the Series D-1 Preferred Stock is subject to adjustment in the event of stock splits, stock dividends, combination of shares and similar recapitalization transactions. The Company commenced an exchange with holders of Series D Convertible Preferred Stock pursuant to which the holders of the Company’s outstanding shares of Series D Preferred Stock acquired in the Merger could exchange such shares for shares of the Company’s Series D-1 Preferred Stock on a one-for-one basis. As of June 30, 2025 and December 31, 2024, 5,000,000 Series D-1 Preferred Stock was designated; 834 and 834 shares remained issued and outstanding. Dividends On February 11, 2025, the board of directors approved a special cash dividend of $0.32 per share payable on March 3, 2025, to holders of common stock and certain warrant holders as of close of business on February 24, 2025. Cash dividends paid in 2025 totaled $7 million and have been charged to accumulated deficit. Treasury Stock There are 60,148 shares of treasury stock as of June 30, 2025. Warrants A summary of warrant activity for the six months ended June 30, 2025, is presented below:
|  |  |  |  | Weighted |  |  |  |  |  | Weighted Average Remaining |
|  |  |  |  | Average Exercise |  |  | Total Intrinsic |  |  | Contractual Life |
|  | Warrants |  |  | Price |  |  | Value |  |  | (in years) |
Outstanding as of December 31, 2024 |  |  | 444,796 |  |  | $ | 29.25 |  |  |  | - |  |  |  | 1.20 |
Granted |  |  | 7,752,108 |  |  |  | 3.97 |  |  |  |  |  |  |  |  |
Expired |  |  | (87,598 | ) |  | $ | 28.74 |  |  |  | - |  |  |  | - |
Exercised |  |  | (591,885 | ) |  |  | 3.94 |  |  |  |  |  |  |  |  |
Outstanding as of June 30, 2025 |  |  | 7,517,421 |  |  | $ | 5.22 |  |  |  | - |  |  |  | 4.44 |
Restricted Stock Awards and Stock Options On October 7, 2022, the Company adopted the 2022 Equity Incentive Plan (“2022 Plan”). The 2022 Plan provided for the issuance of up to 1,100,000 shares in the form of stock options, stock appreciation rights, restricted stock, restricted stock units, and other stock-based awards. The 2022 Plan expires on January 1, 2032, and is administered by Dominari Holdings Board of Directors. On February 10, 2025, the Company issued 50,000 shares of the Company’s common stock under the Company’s 2022 Equity Incentive Plan. Upon issuance, the shares were fully-vested and nonforfeitable with a total fair value $308,000. On February 10, 2025 the Company issued 351,851 shares of the Company’s common stock to Messr. Christopher Devall under the Company’s 2022 Equity Incentive Plan. Upon issuance, the shares were fully-vested and nonforfeitable with a total fair value $2.1 million. On February 12, 2025 in connection with the closing of the PIPE, the Committee determined that it is in the best interests of the Company and its stockholders to make a special equity grant to Messr. Anthony Hayes. Pursuant to the Committee’s decision, he received 500,000 shares of the Company’s common stock. Upon issuance, the shares were fully-vested and nonforfeitable with a total fair value of approximately $3.4 million. On March 11, 2025, 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 $1.7 million. Additionally, on February 10, 2025, the Company granted an additional 5 million fully vested nonqualified stock options (each, a “Performance Award” and collectively, the “Performance Awards”) each to Anthony Hayes and Kyle Wool conditioned upon either the Company’s shareholders approving the Performance Awards or approving an increase in the share reserve of the Company’s 2022 Equity Incentive Plan (the “Plan”) such that the full number of shares underlying the Performance Awards could be delivered under the Plan. On April 1, 2025, following a special meeting of shareholders, the Company’s shareholders voted to approve an increase in the Plan’s share reserve allowing the Performance Awards to be delivered under the Plan. As of June 30, 2025, the Company recorded an expense of $26.1 million for the Performance Awards. See Restricted Stock roll-forward below. A summary of restricted stock awards activity for the six months ended June 30, 2025, is presented below:
|  |  |  |  | Weighted |
|  | Number of |  |  | Average |
|  | Restricted Stock Awards |  |  | Grant Day Fair Value |
Nonvested at December 31, 2024 |  |  | 50,000 |  |  | $ | 0.98 |
Granted |  |  | 1,210,969 |  |  | $ | 6.11 |
Vested |  |  | (1,210,969 | ) |  | $ | 2.20 |
Forfeited |  |  | - |  |  | $ | - |
Nonvested at June 30, 2025 |  |  | 50,000 |  |  | $ | 0.98 |
Stock-based compensation associated with the amortization of restricted stock awards expense was approximately $7,657,000 and $75,000 for the six months ended June 30, 2025, and 2024, respectively. Stock-based compensation associated with the amortization of restricted stock awards expense was approximately $12,000 and $75,000 for the three months ended June 30, 2025, and 2024, respectively All stock compensation was recorded as a component of general and administrative expenses. As of June 30, 2025, there is approximately $25,000 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 six months ended June 30, 2025, is presented below:
|  |  |  |  |  |  |  |  |  |  | Weighted |
|  |  |  |  |  |  |  |  |  |  | Average |
|  |  |  |  | Weighted |  |  | Total |  |  | Remaining |
|  | Number of |  |  | Average |  |  | Intrinsic |  |  | Contractual |
|  | Shares |  |  | Exercise Price |  |  | Value |  |  | Life (in years) |
Outstanding as of December 31, 2024 |  |  | 376,654 |  |  | $ | 4.29 |  |  | $ | - |  |  |  | 8.2 |
Employee options granted |  |  | 10,000,000 |  |  | $ | 3.85 |  |  |  |  |  |  |  | 9.8 |
Employee options expired |  |  | (103,334 | ) |  | $ | 3.21 |  |  |  |  |  |  |  |  |
Employee options forfeited |  |  | (307,560 | ) |  | $ | 3.47 |  |  | $ | 47,267 |  |  |  | - |
Outstanding as of June 30, 2025 |  |  | 10,346,654 |  |  | $ | 3.87 |  |  | $ | 123,633 |  |  |  | 9.7 |
Options vested and exercisable |  |  | 10,212,604 |  |  | $ | 3.87 |  |  | $ | 74,615 |  |  |  | 9.7 |
Stock-based compensation associated with the amortization of stock option expense was approximately $26,198,600 and $0.1 million for the three months ended June 30, 2025, and 2024, respectively. Stock-based compensation associated with the amortization of stock option expense was approximately $33,855,000 and $0 million for the six months ended June 30, 2025, and 2024, respectively. All stock compensation was recorded as a component of general and administrative expenses. Estimated future stock-based compensation expense relating to unvested stock options is approximately $68,000. Non-controlling Interest As previously discussed, the Company owns 90% of AV Manager and AV Investment Manager, the remaining 10% is owned by non-controlling parties. As such, 10% of any profits earned by these entities are attributable to non-controlling interests and are presented in the statement of changes in equity. After June 30, 2025 the entire amount of $1.05 million attributable to non-controlling interests was distributed.

X
- References No definition available. + Details
Name: | us-gaap_StockholdersEquityNoteAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for equity. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 8A -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-8A Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481112/505-10-50-13 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481112/505-10-50-13 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481112/505-10-50-14 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 235 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147477968/946-235-50-2 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 235 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147477968/946-235-50-2 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 505 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Publisher FASB -URI https://asc.fasb.org/1943274/2147478448/946-505-50-6 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 815 -SubTopic 40 -Name Accounting Standards Codification -Section 50 -Paragraph 6 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480237/815-40-50-6 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.3-04) -Publisher FASB -URI https://asc.fasb.org/1943274/2147480008/505-10-S99-1 Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 505 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/505/tableOfContent Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org/1943274/2147481112/505-10-50-13 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481112/505-10-50-13 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Subparagraph (i) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481112/505-10-50-13 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481112/505-10-50-14 Reference 15: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481112/505-10-50-14 Reference 16: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 16 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481112/505-10-50-16 Reference 17: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 18 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481112/505-10-50-18 Reference 18: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 18 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481112/505-10-50-18 Reference 19: http://www.xbrl.org/2003/role/disclosureRef -Topic 505 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 18 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481112/505-10-50-18 + Details
Name: | us-gaap_StockholdersEquityNoteDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration