DOMH

Business Context and Reporting Period

This Form 8-K was filed by AIkido Pharma Inc. (not Dominari Holdings Inc.) on September 9, 2022. The filing reports the entry into a material definitive agreement by Dominari Financial Inc., a wholly owned subsidiary of AIkido, to acquire a financial services firm. The transaction represents a strategic pivot to diversify AIkido's business beyond biotechnology into the financial services sector.

Key Financial Metrics and Transaction Terms

• Target Company: Fieldpoint Private Securities, LLC (a FINRA-registered broker-dealer).
• Total Purchase Price: $2,000,001, subject to adjustment.
• Payment Structure:
  • Initial Closing: $2,000,000 for 20% of membership interests.
  • Second Closing: $1.00 for the remaining 80% of membership interests, contingent upon FINRA approval.
• Price Adjustment Mechanism: The final price is subject to a true-up based on the net asset value (assets minus indebtedness) at the second closing. If net assets are below $2,000,000, the Seller pays the deficit; if above, the Purchaser pays the surplus.
• Financial Statements: The filing does not provide specific revenue, profit, cash flow, or margin data for the target company or AIkido.

Material Changes and Transaction Conditions

The primary material change is the acquisition of Fieldpoint Private Securities, LLC. The transaction is structured in two phases to comply with regulatory requirements:

1. Immediate transfer of 20% ownership upon initial payment.
2. Filing of a Rule 1017 Application with FINRA for change of ownership approval.
3. Transfer of the remaining 80% ownership only after FINRA approval.

The transaction is subject to customary closing conditions, including the accuracy of representations and warranties and the absence of a material adverse effect.

Guidance, Risks, and Contingencies

• Regulatory Risk: The transaction is contingent on final approval by the Financial Industry Regulatory Authority (FINRA) under Rule 1017.
• Termination Rights:
  • Either party may terminate during a 30-day post-execution due diligence period.
  • The Purchaser may terminate if FINRA denies the Rule 1017 Application.
  • Termination for material breach by the Seller or Company is permitted.
Penalty Clause: If the Purchaser terminates due to a breach by the Seller/Company or a FINRA denial, the Seller must pay $2,000,000 to the Purchaser, and the Purchaser must return the Initial Closing Membership Interests.
• Indemnification: Representations and warranties survive for 12 months following the second closing date.

Investor Verification Checklist

• Verify the status of the FINRA Rule 1017 Application for change of ownership.
• Confirm the net asset value of Fieldpoint Private Securities, LLC at the time of the second closing to determine the final purchase price adjustment.
• Review the full Membership Interest Purchase Agreement (Exhibit 2.1) for detailed representations, warranties, and covenants.
• Monitor for any material adverse effects on the target company or AIkido prior to closing.
• Clarify the strategic integration plan for the financial services subsidiary within AIkido's existing biotechnology operations.