Item 5. Market for Registrant’s Common Equity
ITEM
5.
MARKET
FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
Market
Information
Our
Common Stock is quoted on The OTC Pink Marketplace under the symbol “DBGI”. Prior to December 18, 2024, the Company’s
common stock was listed on the Nasdaq Capital Market.
The
following table sets forth the high and low sale prices for our common stock as reported by The Nasdaq Stock Market (through
December 17, 2024) and OTC Markets (beginning on December 18, 2024). The OTC Markets is a computer network that provides information on current “bids” and “asks,”
as well as volume information. These quotations reflect inter-dealer prices, without retail
mark-up, mark-down or commission and may not necessarily represent actual transactions.
Dollar amounts included
in the table have been adjusted to reflect the Reverse Stock Splits.
Low
High
Fiscal 2023
First Quarter (January 1, 2023 - March 31, 2023)
$ 1,387.50
$ 5,337.50
Second Quarter (April 1, 2023 - June 30, 2023)
$ 725.00
$ 1,950.00
Third Quarter (July 1, 2023 - September 30, 2023)
$ 367.00
$ 1,237.50
Fourth Quarter (October 1, 2023 - December 31, 2023)
$ 139.50
$ 424.50
Fiscal 2024
First Quarter (January 1, 2024 - March 31, 2024)
$ 115.00
$ 640.00
Second Quarter (April 1, 2024 - June 30, 2024)
$ 65.50
$ 242.50
Third Quarter (July 1, 2024 - September 30, 2024)
$ 15.00
$ 105.50
Fourth Quarter (October 1, 2024 - December 31, 2024)
$ 1.03
$ 30.34
Fiscal 2025
First Quarter (January 1, 2025 - March 31, 2025)
$ 1.25
$ 10.19
On
April 8, 2025, the last reported sale price of our common stock was $9.39 per share. There is no established public trading
market for the Units, the Warrants or the Pre-Funded Warrants. We do not intend to apply for listing of the Units, the Warrants or
the Pre-Funded Warrants on any securities exchange or recognized trading system.
Holders
On April 9, 2025, there were 62 stockholders of record.
Dividends
We
have never declared or paid cash dividends on our capital stock. We currently intend to retain all of our future earnings, if any, to
finance the growth and development of our business. In addition, the terms of any future debt agreements may preclude us from paying
dividends. As a result, capital appreciation, if any, of our shares of common stock will be your sole source of gain for the foreseeable
future.
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Recent
Sales of Unregistered Securities
In
February 2024, the Company issued an aggregate of 1,059 shares of common stock to a marketing vendor for services. The fair value of
$173,290 or $163.50 per share as determined by the agreements, was included in sales and marketing expenses in the consolidated statements
of operations.
In
February 2024, the Company issued an aggregate of 311 shares of common stock to a vendor as conversion of accounts payable for a total
value of $50,975.
In
March 2024, 3,042 shares of Series C Convertible Preferred Stock converted into 3,840 shares of common stock.
On
May 3, 2024, the Company entered into that certain inducement offer to exercise common stock purchase warrants with the Investor (the
“Inducement Agreement”), pursuant to which (i) the Company agreed to lower the exercise price of the Existing Warrants to
$156.50 per share and (ii) the Investor agreed to exercise the Existing Warrants into 20,555 shares of common stock (the “Exercise
Shares”) by payment of the aggregate exercise price of $3,216,857. The closing occurred on May 7, 2024. The Company has issued
all of the 20,555 shares of common stock underlying the Existing Warrants. The Company received the entire gross proceeds of $3,216,857
in May 2024, which represents the exercise of the entire 20,555 warrants at the $156.50 exercise price. The Company received net proceeds
of $2,877,475 after placement agent fees and expenses. In addition, pursuant to the Inducement Agreement, the Company issued to the Investor
a Series A-1 common share purchase warrant to purchase up to 20,555 shares of Common Stock (“Series A-1 Warrant”) and Series
B-1 common share purchase warrant to purchase up to 20,555 shares of Common Stock (“Series B-1 Warrant”, and collectively
with the Series A-1 Warrant, the “Warrants”) on May 7, 2024, each at an initial exercise price equal to $144 per share of
Common Stock. The Series A-1 Warrant are exercisable immediately upon issuance and expires five and one-half (5.5) years following the
issuance date and the Series B-1 Warrant are exercisable immediately upon issuance and expires fifteen (15) months following the issuance
date. In connection with the Inducement Agreement, we entered into an engagement agreement with H.C. Wainwright & Co., LLC (“Wainwright”),
pursuant to which we have, among other things, issued to Wainwright’s designees warrants to purchase up to 1,541 shares of Common
Stock (the “Wainwright Warrants”). The terms of the Wainwright Warrants are substantially the same as the terms of the Series
A-1 Warrant except that they have an exercise price of $195.63 per share.
In
July 2024, the Company issued 1,210 shares of common stock to a vendor for services rendered for a total value of $172,501.
In
July 2024, 299 shares of Series C Convertible Preferred Stock converted into 333 shares of common stock.
In
August 2024, 101 shares of Series C Convertible Preferred Stock converted into 112 shares of common stock.
In
August 2024, the Company issued 2,120 shares of common stock to a commercial debt holder in satisfaction of $313,816 of debt.
Between
October 3, 2024 and October 15, 2024, the Company issued 26,226 shares of the Company’s common stock (the “Shares”)
to a certain note holder upon conversion of a portion of their promissory note originally issued by the Company on or around October
1, 2023 (the “Note”). On October 16, 2024, the Company became aware that the issuance of the Shares was in error and not
permitted under the terms of the Note due to the requirement thereunder that stockholder approval be obtained prior to the issuance of
more than 19.9% of the Company’s pre-transaction shares outstanding upon conversion(s) of the Note, as referenced and specifically
required under Nasdaq Listing Rule 5635(d). The Company then notified the note holder that the Shares must be returned to the Company’s
transfer agent for cancellation. On November 5, 2024, the holder facilitated the cancellation of 26,226 shares of the Company’s
common stock in accordance with the Company’s remediation plan. The Company communicated with The Nasdaq Stock Market LLC regarding
the aforementioned erroneous issuance of the Shares and subsequent remediation actions. The Listing Qualifications Staff (the “Staff”)
of The Nasdaq Stock Market LLC considered the Company’s non-compliance with Nasdaq Listing Rule 5635(d) as an additional basis
for the delisting of the Company’s securities from Nasdaq.
On
or around January 17, 2025, the Company closed a private placement pursuant to a securities purchase agreement with a certain accredited
investor, pursuant to which the Company agreed to issue and sell, in a private placement, a promissory note in the principal amount of
$121,900.00 (the “January 2025 Note”). The January 2025 Note is convertible into common stock upon default at a conversion
price equal to 61% of the lowest closing bid price during the ten trading days prior to the conversion date. The January 2025 Note provides
that the total number of shares of common stock that may be issued upon conversion thereof shall not exceed 19.99% of the shares of Common
Stock outstanding as of the issuance date of the January 2025 Note.
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On
or around January 20, 2025, the Company entered into a vendor agreement (the “Vendor Agreement”) with MavDB Consulting LLC
(the “Vendor”). The engagement of the Vendor is for a five (5) year period and the vendor services to be provided include,
but are not limited to, product content production, social media marketing, engagement of influencers and student athletes for product
awareness, and event and staffing costs (the “Services”). In consideration for the Services, the Company will pay the Vendor
a vendor fee equal to $3,000,000 (the “Cash Fee”) within thirty calendar days after the date of the Vendor Agreement (the
“Payment Period”), provided, however, that Vendor may elect to receive the Vendor Shares (as defined below) and/or Vendor
Pre-Funded Warrants (as defined below) as described below in lieu of the Cash Fee by providing written notice to the Company of such
election during the Payment Period (the “Written Notice”). The “Vendor Shares” shall mean a number of Common
Stock equal to the Cash Fee divided by $1.45, provided, however, if the issuance of any of the Vendor Shares would cause the Vendor to
exceed 4.99% of the of the outstanding Common Stock, as determined in accordance with Section 16 of the Exchange Act and the regulations
promulgated thereunder, then the Company shall instead issue to Vendor pre-funded warrants (the “Vendor Pre-Funded Warrants”)
for the purchase of the amount of Vendor Shares in excess of the beneficial ownership limitation, provided, further, that if the Vendor
specifies in the Written Notice that the Vendor elects to receive Vendor Pre-Funded Warrants in lieu of the entire amount of the Vendor
Shares, then the Company shall instead issue to Vendor the Vendor Pre-Funded Warrants to purchase the entire amount of the Vendor Shares.
The Vendor delivered the Written Notice to the Company during the Payment Period and the Company issued the Vendor Pre-Funded Warrants
for the purchase of 2,068,965 shares of Common Stock to Vendor on January 21, 2025.
The
Vendor Pre-Funded Warrants have an initial exercise price per share of Common Stock equal to $0.01. The Vendor Pre-Funded Warrants are
immediately exercisable and will expire five (5) years after the issuance date of the Vendor Pre-Funded Warrants. The exercise price
and number of shares of Common Stock issuable upon exercise is subject to appropriate adjustment in the event of share dividends, share
splits, reorganizations or similar events. The Vendor Pre-Funded Warrants will be exercisable, at the option of the Vendor, in whole
or in part, by delivering to us a duly executed exercise notice accompanied by payment in full for the number of shares of Common Stock
purchased upon such exercise (except in the case of a cashless exercise). The Vendor (together with its affiliates) may not exercise
any portion of the Vendor Pre-Funded Warrants to the extent that the Vendor would own more than 4.99% of the outstanding shares of Common
Stock immediately after exercise, except that upon at least 61 days’ prior notice from the Vendor to us, the Vendor may increase
the amount of beneficial ownership of outstanding shares after exercising the Vendor’s Pre-Funded Warrants up to 9.99% of the number
of our shares of Common Stock outstanding immediately after giving effect to the exercise, as such percentage ownership is determined
in accordance with the terms of the Vendor Pre-Funded Warrants. In lieu of making the cash payment otherwise contemplated to be made
to us upon such exercise in payment of the aggregate exercise price, the Vendor may elect instead to receive upon such exercise (either
in whole or in part) the number of shares of Common Stock determined according to a formula set forth in the Vendor Pre-Funded Warrants.
On
January 22, 2025, the Company issued a promissory note in the principal amount of $260,000.00 (the “Second Note”) to an accredited
investor (“Investor”), pursuant to which the Investor made a loan to the Company. The Second Note carries an original issue
discount of $60,000.00, and accordingly the purchase price of the Second Note is $200,000.00. The Second Note matures on April 22, 2025,
and contains customary events of default. Upon the occurrence of any event of default under the Second Note, the Second Note will become
immediately due and payable in an amount equal to the outstanding principal and accrued interest under the Second Note plus default interest
at the rate of sixteen percent (16%) per annum.
Securities
Authorized for Issuance Under Equity Compensation Plans
We
have adopted a 2020 Omnibus Incentive Stock Plan (the “2020 Plan”). An aggregate of 26 shares of our common stock is reserved
for issuance and available for awards under the 2020 Plan, including incentive stock options granted under the 2020 Plan. The 2020 Plan
administrator may grant awards to any employee, director, and consultants of the company and its subsidiaries. To date, grants covering
22 shares of common stock have been made under the 2020 Plan and 4 shares remain eligible for
issuance under the 2020 Plan.
The
2020 Plan is currently administered by the Compensation Committee of the Board as the Plan administrator. The 2020 Plan administrator
has the authority to determine, within the limits of the express provisions of the 2020 Plan, the individuals to whom awards will be
granted, the nature, amount and terms of such awards and the objectives and conditions for earning such awards. The Board may at any
time amend or terminate the 2020 Plan, provided that no such action may be taken that adversely affects any rights or obligations with
respect to any awards previously made under the 2020 Plan without the consent of the recipient. No awards may be made under the 2020
Plan after the tenth anniversary of its effective date.
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Awards
under the 2020 Plan may include incentive stock options, nonqualified stock options, stock appreciation rights (“SARs”),
restricted shares of common stock, restricted stock Units, performance share or Unit awards, other stock-based awards and cash-based
incentive awards.
ITEM
6.
RESERVED