Note 11. Stockholders’ Equity and Convertible Preferred Stock

Common Stock

As of March 31, 2026, there are 22,613,781 shares of common stock issued and outstanding This includes 316,346 unvested shares issued that are subject to forfeiture through September 30, 2026, and 80,000 unvested shares issued that are subject to forfeiture through December 11, 2026.

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 $20.9 million and is presented in advisory fees expense on the unaudited condensed consolidated statement of operations.

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 January 1, 2026 to March 31, 2026, various individuals exercised warrants, resulting in the additional issuance of 75,000 shares of common stock and cash proceeds of $0.3 million, which were recorded in additional paid-in capital and are reflected in the unaudited condensed consolidated statements of changes in stockholders’ 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 March 31, 2026, and December 31, 2025, 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 March 31, 2026 and December 31, 2025, 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. On September 9, 2025, the board of directors approved a special cash dividend of $0.22 per share payable on September 26, 2025, to holders of common stock and certain warrant holders as of close of business on September 3, 2025. On December 11, 2025, the board of directors approved a special cash dividend of $0.432 per share payable on January 26, 2026, to holders of common stock and certain warrant holders as of close of business on January 5, 2026, Cash dividends declared in 2025 totaled $22.2 million and have been charged to accumulated deficit. Dividends paid for the three months ended March 31, 2025, totaled $7.0 million, and dividends paid for the three months ended September 30, 2025, totaled $4.9 million. Dividends declared totaled $10.3 million during the three months ended December 31, 2025, of which $9.9 million were paid during the three months ended March 31, 2026, resulting in a dividend payable of $0.4 million as of March 31, 2026.

Warrants

A summary of warrant activity for the three months ended March 31, 2026, is presented below:

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 the 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 Messrs. 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 Messrs. 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.

On December 10, 2025, the Company issued 316,346 shares of the Company’s common stock under the Company’s 2022 Equity Incentive Plan. These shares will vest on September 30, 2026; provided that in the event of a change in control prior to any such vesting date, the shares, which have not yet vested shall vest and become nonforfeitable upon the effective date of such change in control, with a total fair value of $1.3 million.

On December 11, 2025, the Company issued 80,000 shares of the Company’s common stock under the Company’s 2022 Equity Incentive Plan. These shares will vest on the one-year anniversary of the grant date; provided that in the event of a change in control prior to any such vesting date, the shares, which have not yet vested shall vest and become nonforfeitable upon the effective date of such change in control, with a total fair value of $381 thousand.

On January 9, 2026, the Company issued 75,000 shares of the Company’s common stock under the Company’s 2022 Equity Incentive Plan to members of the board of directors. Upon issuance, the shares were fully-vested and nonforfeitable with a total fair value of $320 thousand.

On March 4, 2026, the Committee determined that it is in the best interests of the Company and its stockholders to make a special equity grant of 3.0 million shares of the Company’s common stock each to Messrs. Anthony Hayes and Kyle Wool, pursuant to shareholder approval to increase the shares of common stock reserved for issuance under the Company’s 2022 Equity Incentive Plan, which was approved on March 4, 2026 at a Special Meeting of Shareholders Upon issuance, the shares were fully-vested and nonforfeitable with a total fair value of approximately $18.4 million.

See Restricted Stock roll-forward below.

A summary of restricted stock awards activity for the three months ended March 31, 2026, is presented below:

Stock-based compensation associated with restricted stock awards was approximately $19.2 million and $7.6 million for the three months ended March 31, 2026, and 2025, respectively. All stock compensation was recorded as a component of compensation and benefits expenses. The 396,346 nonvested restricted stock units that were approved in December 2025 in the table above are reflected as being issued in the unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three months ended March 31, 2026.

As of March 31, 2026, there is approximately $1.1 million unrecognized stock-based compensation expense related to restricted stock awards.

Stock Options

On February 10, 2025, the Company granted an additional 5.0 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. The Company recorded an expense of $26.1 million for the Performance Awards during the second quarter of 2025.

On December 1, 2025, the Company entered into an advisory agreement with a certain individual who was issued 50,000 nonqualified stock options (“Advisor Options”). Each party reserves the right to terminate the agreement at any time, with or without cause, upon five (5) days prior written notice to the other party. One half of the Advisor Options shall vest and become exercisable during its term on December 1, 2025, and one half of the Advisor Options shall vest and become exercisable during its term on June 1, 2026, in the manner and subject to the terms and conditions of the Plan and the Stock Option Grant Agreement (the “Option Grant Agreement”). The Company used a Black Scholes valuation to calculate the grant date fair value of the Advisor Options. The fair value of the Advisor Options amounted to $146 thousand and the Company recorded an expense of $36 thousand during the three months ended 2026 related to such options.

A summary of option activity under the Company’s stock option plan for the three months ended March 31, 2026, is presented below:

Stock-based compensation associated with stock options was approximately $36 thousand and $38 thousand for the three months ended March 31, 2026, and 2025, respectively. All stock compensation was recorded as a component of compensation and benefits expenses.

Estimated future stock-based compensation expense relating to unvested stock options is approximately $24 thousand.

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 unaudited condensed consolidated statements of changes in stockholders’ equity. As of March 31, 2026, the revenue attributable to non-controlling interest was $23 thousand of which the Company owes $21 thousand at March 31, 2026. During the three months ended March 31, 2026, the Company distributed $55 thousand to non-controlling interests.