What changed in this filing

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Item 9A. Controls and Procedures

2025-03-28 compared with 2024-10-15 · 240 added, 262 removed, 462 unchanged (52% of the section changed)

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In designing and evaluating the Disclosure Controls, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives and management was required to apply judgement in evaluating its controls and procedures.

Based on this Evaluation, due to the material weaknesses described below, the CEO and CFO concluded that the Company’s Disclosure Controls were not effective as of December 31, 2023.

Based on this Evaluation, due to the material weakness described below, the CEO and CFO concluded that the Company’s Disclosure Controls were not effective as of December 31, 2024.

Management's Report on Internal Control Over Financial Reporting

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In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework (2013).

Based on this evaluation, management concluded that the Company’s internal control over financial reporting was not effective as of December 31, 2023 due to the material weaknesses described below.

We identified material weaknesses in our controls over the journal entry processes, information technology general controls (“ITGC”) and the technical evaluation of accounting matters that existed as of December 31, 2023.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or

detected on a timely basis.

The material weaknesses are a result of our processes and related controls not operating effectively related to journal entry processes, ITGC and the technical evaluation of accounting matters.

As further detailed in Note 13 – Restatement (Unaudited) to the Company’s audited financial statements, the Company identified prior year accounting errors in the Company’s previously reported unaudited interim consolidated financial statements beginning March 31, 2022 resulting from the incorrect (1) accounting for and presentation of NCI, (2) recognition of an organizational transaction in connection with the Company’s initial public offering, (3) presentation of earnings per share considering the effect of certain features of the Company’s warrants and the impact of correcting the accounting for, and presentation of, NCI, and (4) timing of the recording of the 2023 redemption of warrants.

The Company’s management and the audit committee of the Company’s Board of Directors concluded that it was appropriate to restate the quarterly unaudited consolidated financial statements for the quarterly periods ended March 31, 2023, June 30, 2023, and September 30, 2023.

Other than the described above, there were no material misstatements as a result of this material weakness;

however, it could have resulted in a material misstatement to the annual or interim financial statements that would not have been prevented or detected on a timely basis.

Based on this evaluation,

management concluded that the Company’s internal control over financial reporting was not effective as of December 31, 2024 due to the material weakness described below.

We identified a material weakness in our controls over the technical evaluation of accounting matters that existed as of December 31, 2023 and 2024.

The material weakness is a result of our processes and related controls not operating effectively related to the technical evaluation of accounting matters.

As previously reported and as currently disclosed in the Company’s consolidated financial statements, the Company identified certain prior period accounting errors.

There were no material misstatements as a result of this material weakness;

however, it could have resulted in a material misstatement to the annual or interim consolidated financial statements that would not have been prevented or detected on a timely basis.

Due to the material weakness, we have concluded that our internal control over financial reporting was not effective as of December 31, 2024.

Management’s Plan to Remediate the Material Weakness

Management has implemented remediation steps to address the material weaknesses and to improve our internal control environment.

Specifically, in late 2023, the Company engaged consultants to assist in identifying and testing the design of control over business processes as well as ITGC.

The first phase of this project was completed in the first quarter of 2024.

We are in the process of enhancing the design of certain internal control procedures and implementing new internal controls over (1) the segregation of duties within the journal entry process, (2) the access to program and change management within our information technology environment, and (3) the evaluation of technical accounting matters.

These controls are planned to be tested for design and operating effectiveness in future periods.

Management has implemented remediation steps to address the material weakness and to improve our internal control environment.

Specifically, in late 2023, the Company engaged consultants to assist in identifying and testing the design of control over business processes.

The first phase of this project was completed in the first quarter of 2024 and continued through the remainder of 2024.

The Company believes significant progress was made in 2024 to enhance and strengthen its internal controls over the evaluation of technical accounting matters, including hiring additional qualified accounting personnel and enhancing controls related to assessment and documentation of technical acco unting matters.

However, these internal controls were not in all cases in place for a sufficient period of time to demonstrate operating effectiveness as of December 31, 2024.

As a result, the Company’s management concluded that the material wea kness related to the technical evaluation of accounting matters was not fully remediated as of December 31, 2024.

The Company will continue the engagement with outside consultants to review the revised control processes and procedures.

While the Company has implemented remediation steps, the material weakness cannot be considered fully remediated until the improved controls have been in place and operate for a sufficient period of time.

However, our management, including our Chief Executive Officer and Chief Financial Officer, has concluded that, notwithstanding the identified material weaknesses in our internal control over financial reporting, the financial statements fairly present, in all material respects, our financial condition, results of operations and cash flows for the periods presented in conformity with U.S.

Our management, including our CEO and CFO, has concluded that, notwithstanding the identified material weaknesses in our internal control over financial reporting, the financial statements fairly present, in all material respects, our financial condition, results of operations and cash flows for the periods presented in conformity with U.S.

Remediation of Previously Reported Material Weakness

During the year ended December 31, 2023, the Company completed its efforts to remediate the material weakness identified in 2022 in our controls over completeness of revenue.

Upon completion of those efforts, the Company concluded that the material weakness had been remediated as of December 31, 2023.

As part of those remediation efforts, the Company implemented remediation actions during 2023 that included improving its review process including the reconciliation and documentation of the demand-side platform reports to the sell-side platform data, improving contract management and review processes, engaging outside consultants to review business process analysis and flow of data to the accounting software platform and financial reporting, identifying and documenting the risk assessment and internal controls, and testing the effectiveness of the design of our internal controls.

During the year ended December 31, 2024, the Company completed its efforts to remediate the material weaknesses identified in 2023 related to internal controls over (1) the segregation of duties within the journal entry process and (2) the access to program and change management within our information technology environment.

Upon completion of those efforts, the Company concluded that the material weaknesses had been remediated as of December 31, 2024.

As part of those remediation efforts, the Company implemented remediation actions during 2024 that included implementing new controls over the journal entry process and enhancing the design of certain internal control procedures related to the access to program and change management within the Company's information technology environment.

Changes in Internal Controls Over Financial Reporting

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The following table sets forth information regarding our executive officers and directors as of the date of this Annual Report on Form 10-K:

Name Age Position(s) Since

Executive Officers

Chairman and Chief Executive Officer

President and Director

Chief Financial Officer

Maria Vilchez Lowrey

Chief Growth Officer

Chief Technology Officer

Walker 49 Chairman and Chief Executive Officer August 2021

Smith 56 President and Director August 2021

Diaz 61 Chief Financial Officer October 2023

Anu Pillai 55 Chief Technology Officer March 2021

Maria Vilchez Lowrey 43 Chief Growth Officer August 2022

Non-Employee Directors

Richard Cohen

December 2021

Richard Cohen 74 Director December 2021

Antoinette R.

December 2021

Mistelle Locke

Leatherberry 63 Director December 2021

Mistelle Locke 48 Director January 2023

Executive Officers

Walker became our Chairman and Chief Executive Officer on August 23, 2021 and, from 2018 until August 22, 2021, served in the role of Managing Partner of Direct Digital Holdings LLC, a subsidiary of the Company and our holding company prior to the completion of our initial public offering (“DDH LLC”).

Walker is a co-founder of the Company and became our Chairman and Chief Executive Officer on August 23, 2021 and, from 2018 until August 22, 2021, served in the role of Managing Partner of Direct Digital Holdings LLC, a subsidiary of the Company and our holding company prior to the completion of our initial public offering.

Prior to founding Direct Digital with Mr.

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Prior to Capital Point Partners, he worked for Rabobank International (“RI”) from 2006 to 2009, where he was a Vice President and Portfolio Manager of more than $2 billion in direct lending and structured credit bank assets for one of the company’s special investment vehicles.

He played a key role in originating new client transactions as well as managing a book of

existing bank clients.

He played a key role in originating new client transactions as well as managing a book of existing bank clients.

Prior to RI, he was an Associate Director in the Structured Finance Group of Standard & Poor’s from 2003 to 2006, where he analyzed and rated transactions across a broad spectrum of asset types.

In addition to his investment banking background, Mr.

Smith also has over six years of legal experience as an attorney and has served on the boards of numerous portfolio companies.

Smith also has over six years of legal experience as an attorney and has served on the

boards of numerous portfolio companies.

We believe that Mr.

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Jones Graduate School of Management.

Pillai was named Chief Technology Officer of Direct Digital in March 2021.

Pillai brings extensive experience in defining and executing new product development solutions as well as large enterprise IT implementations and has successfully led global projects with complete responsibility for cross-functional teams in program management, product design, software development, system architecture, cybersecurity, integration and implementation.

Prior to serving at Digital Direct Holdings, Ms.

Pillai held executive positions and led digital transformations at several companies, including BLK/OPL, a direct-to-consumer e-commerce cosmetic brand, from 2019 to 2021, where she served as SVP, Digital Technology & Ecommerce, and Ebony Media, publisher of the iconic EBONY magazine, from 2011 to 2019, where she served as SVP, Digital Technology & Monetization.

She was responsible at both of these companies for the execution of all technology and digital initiatives including system design and architecture, development, project management, resource planning of onsite/offshore resources and monetization across all digital properties with specific emphasis on increasing revenues through various programmatic channels.

Prior to that, Ms.

Pillai held leadership roles with leading Fortune 50 technology and infrastructure companies, such as General Electric, from 2005 to 2007, where she served as an IT leaser;

Intel Corporation, from 2000 to 2003, where she served as a Senior Software Engineer;

and Motorola, from 1996 to 1998, where she served as an analyst, and we believe she has proven experience in managing and leading small and large global development teams with technology resources spread across the U.S., China, Mexico and India.

Pillai holds a B.S.

in Computer Science and Engineering from Bharathiar in India.

Maria Vilchez Lowrey.

Maria Vilchez Lowrey was named Chief Growth Officer of Direct Digital in August 2022.

Lowrey was named Chief Growth Officer of Direct Digital in August 2022.

Lowrey is responsible for leading business development, channel development, and integrating the management of brand related marketing activities across Direct Digital’s portfolio of brands.

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There, she was responsible for diversifying the company's direct sales channels by launching its first national retail partnership with one of the largest retailers in the world.

Prior to that, she served in various key management positions across sales leadership, business development, operations, and project management at NRG Energy, Inc.(NYSE:

Prior to that, she served in various key management positions across sales leadership, business development, operations, and project management at NRG Energy, Inc.

NRG) from 2007 to 2016, primarily responsible for building new go-to-market sales channels and developing strategic partnerships with the most well-known brands in the country.

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in Management Information Systems from Texas A&M University.

Anu Pillai was named Chief Technology Officer of Direct Digital in March 2021.

Prior to serving at Digital Direct Holdings, Ms.

Prior to that, Ms.

held leadership roles with leading Fortune 50 technology and infrastructure companies, such as General Electric, from 2005 to 2007, where she served as an IT leaser;

Intel Corporation, from 2000 to 2003, where she served as a Senior Software Engineer;

Pillai holds a B.S.

in Computer Science and Engineering from Bharathiar in India.

Non-Employee Directors

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She also received the e-Microsoft Bing "Lifetime Achievement" award, for her contribution to the digital advertising industry, and Fast Company listed her on its list of "25 Top Women Business Builders." We believe Ms.

Locke is qualified to serve

as a member of our board of directors because of her tremendous amount of industry insight and expertise and will be a valuable asset for the senior leadership team and our strategic decision-making.

Locke is qualified to serve as a member of our board of directors because of her tremendous amount of industry insight and expertise and will be a valuable asset for the senior leadership team and our strategic decision-making.

She holds a Bachelor’s Degree in Corporate Communications from the University of Texas.

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• reviewing and approving any related-party transactions, after reviewing each such transaction for potential conflicts of interests and other improprieties;

● obtaining and reviewing a report by the independent registered public accounting firm at least annually that describes our internal quality control procedures, any material issues with such procedures and any steps taken to deal with such issues when required by applicable law;

• if applicable, obtaining and reviewing a report by the independent registered public accounting firm at least annually that describes our internal quality control procedures, any material issues with such procedures and any steps taken to deal with such issues when required by applicable law;

• approving or, as permitted, pre-approving, audit and permissible non-audit services to be performed by the independent registered public accounting firm;

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We intend to disclose future amendments to certain provisions of our code of business conduct and ethics, or waivers of these provisions, on our website or in filings under the Exchange Act.

Insider Trading Policy

The Company has adopted an insider trading policy that governs the purchase, sale, and/or other transactions of our securities by our directors, officers and employees.

A copy of our insider trading policy is filed as Exhibit 19.1 to this Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

In addition, with regard to the Company’s trading in its own securities, it is the Company’s policy to comply with the federal securities laws and the applicable exchange listing requirements.

Delinquent Section 16(a) Reports

Section 16(a) of the Exchange Act requires our directors, executive officers and persons who own more than 10% of the shares of our Common Stock to file an initial report of ownership on Form 3 and changes in ownership on Form 4 or Form 5 with the SEC.

Such officers, directors and 10% stockholders are also required by SEC rules to furnish us with copies of any Forms 3, 4 or 5 that they file.

SEC rules require us to disclose late filings of initial reports of stock ownership and changes in stock ownership by our directors, executive officers and 10% stockholders.

Based solely on a review of copies of the Forms 3, 4 and 5 furnished to us by reporting persons and any written representations furnished by certain reporting persons, we believe that during the fiscal year ended December 31, 2024, all Section 16(a) filing requirements applicable to our directors, executive officers and 10% stockholders were completed in a timely manner, except for one Form 4 filing relating to one transaction completed by Mistelle Locke, one of our independent directors, that was not filed timely due to administrative error.

Executive Compensation

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Diaz, Chief Financial Officer.

● Susan Echard, former Chief Financial Officer.

Summary Compensation Table

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Name and principal

position Year Salary

($) Nonequity

incentive plan

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($) All other compensation

Mark Walker 2024 500,000 — — — 25,000 (2) 525,000

Chairman and Chief Executive Officer 2023 530,200 380,335 276,844 71,759 — 1,259,138

Keith Smith 2024 500,000 — — — 25,000 (2) 525,000

President 2023 530,200 380,335 276,844 71,759 — 1,259,138

Diaz 2024 350,000 — — — 10,000 (2) 360,000

Chief Financial Officer 2023 (3) 75,000 88,742 45,879 28,762 — 238,383

Former Chief Financial Officer

(1) Represents the aggregate grant date fair value computed in accordance with FASB ASC Topic 718, excluding the effect of estimated forfeitures.

The assumptions used in calculating these values are described in Note 2 to the Company’s consolidated financial statements contained herein.

The assumptions used in calculating these values are described in Note 2 — Basis of Presentation and Consolidation and Summary of Significant Accounting Policies to the Company’s consolidated financial statements contained herein.

(2) These amounts represent cash stipends to be used for individual benefits of the executive’s choosing.

Diaz was employed by Vaco, LLC, a consulting firm, to which we paid a total of $290,000 in fees for fiscal year 2023, prior to Ms.

Diaz joining the Company in October 2023.

Echard’s employment with the Company ceased on June 5, 2023.

As a result of that cessation, Ms.

Echard become entitled to severance payments equal to 12 months of her base salary, subject to her continued compliance with restrictive covenants.

This amount represents the portion of those severance payments made to her in 2023.

The remaining $257,000 in severance payments were made to Ms.

Echard in 2024 .

Annual Incentive Program

Our named executive officers are each eligible to participate in an annual incentive program.

Under this program, each participating executive has a target annual incentive amount and may earn between zero and 90% of that target amount based on the Company’s achievement of specified performance goals.

For 2022, Messrs.

Walker and Smith and Ms.

Echard had target annual incentive amounts equal to 75%, 75% and 50% of their base salaries, respectively, and based on 2022 corporate performance, they each earned annual incentive payouts equal to 150% of their target amounts.

For 2023, Messrs.

Under this program, each participating executive has a target annual incentive amount and may earn between zero and 150% of that target amount based on the Company’s achievement of specified goals for revenue and EBITDA performance.

For 2024 and 2023, Messrs.

Walker and Smith and Ms.

Diaz had target annual incentive amounts equal to 75%, 75% and 50% of their base salaries, respectively, and based on 2023 corporate performance, they each earned annual incentive payouts equal to 85% of their target amounts.

Diaz had target annual incentive amounts equal to 75%, 75% and 50% of their base salaries, respectively.

Based on 2023 corporate performance, they each earned annual incentive payouts equal to 85% of their target amounts.

The earned annual incentive payouts in 2024 for 2023 performance are reported in the Summary Compensation Table above under the heading “Non-Equity Incentive Plan Compensation” and were paid in cash.

The earned annual incentive payouts for 2023 were paid in 2024 in the form of unrestricted shares of our common stock.

Based on 2024 corporate performance, there were no payouts for 2024.

Executive Employment Agreements with our Named Executive Officers

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Diaz have each entered into employment agreements with our subsidiary DDH LLC.

The employment agreements set forth their annual base salaries of $500,000, $500,000 and $350,000, respectively, their eligibility for annual bonuses and long-term incentive awards, the at-will nature of their employment, certain expense

reimbursements, and their eligibility to participate in our benefit plans generally.

In addition, the employment agreements include customary non-competition, non-solicitation, non-disparagement, confidentiality, and intellectual property covenants.

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and (iv) any other payments, benefits, or fringe benefits to which he or she is entitled as of the termination date under any applicable plan, program or grant.

In addition, if the executive’s employment is terminated without “cause” by DDH LLC or by the executive for “good reason”, in either case prior to a “change in control” (as those terms are defined in the executive’s employment agreement), the executive will be entitled to continuation of his or her base salary for twelve months.

In addition, if the executive’s employment is terminated by DDH LLC without “cause” or by the executive for “good reason”, in either case prior to a “change in control” (as those terms are defined in the executive’s employment agreement), the executive will be entitled to continuation of his or her base salary for twelve months.

However, if such termination without cause or resignation with good reason occurs upon or following a Change in Control, the executive’s period of base salary continuation will be extended from twelve to twenty-four months and the executive will also be entitled to a lump sum payment equal to his or her target bonus for the year of separation.

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Equity Awards

Each of our named executive officers is also eligible to receive equity awards under our 2022 Omnibus Incentive Plan.

Each of our named executive officers is also eligible to receive equity awards under our 2022 Omnibus Incentive Plan, as amended (the “2022 Plan”).

The size and other terms of equity awards are determined by the compensation committee of our board of directors, in their discretion.

In 2023, the compensation committee made both restricted stock unit and stock option awards to our named executive officers.

These restricted stock unit and stock option awards generally vest (subject to the continued service of the grantee) in three equal annual installments, although vesting may accelerate in connection with certain employment terminations or a change in control.

On March 20, 2023, the compensation committee granted to each of Messrs.

Walker and Smith:

(i) 40,000 RSUs vesting on March 20, 2024, and (ii) 29,910 RSUs vesting in three equal annual installments, on March 20, 2024, March 20, 2025 and March 20, 2026.

During 2024, shares of Class A Common Stock were issued in respect of the portion of these RSUs vesting on March 20, 2024.

However, in December 2024, the Company rescinded the issued shares (and the related RSUs) at the request of the grantees.

The rescissions did not affect the portion of the 2023 RSUs vesting on March 20, 2025 and March 20, 2026, which RSUs remain outstanding.

In 2024, the compensation committee opted to pay the named executive officers’ earned 2023 annual incentives in shares of unrestricted Class A Common Stock, based on the weighted average closing price of our Class A Common Stock for the period December 1, 2023 through March 11, 2024.

Otherwise, no equity awards were granted to the named executive officers in 2024.

Outstanding Equity Awards at Fiscal Year End

Exercisable (#)

Unexercisable (#)(1)

Vested (#)(2)

Mark Walker Chairman and Chief Executive Officer

The following table sets forth information regarding outstanding equity awards held by the Company’s named executive officers as of December 31, 2024.

position Number of

Exercisable (#) Number of

Unexercisable (#)(1) Option/

Price ($) Option/

Date Number of

Vested (#)(2) Market

Mark Walker 40,600 20,300 (3) $ 1.62 6/10/2032 20,300 $ 32,886

Chairman and Chief Executive Officer 9,970 19,940 (4) $ 3.96 3/20/2033 12,398 $ 49,096

Keith Smith President 40,600 20,300 (3) $ 1.62 6/10/2032 20,300 $ 32,886

Diana Diaz, Chief Financial Officer

Susan Echard, Former Chief Financial Officer

President 9,970 19,940 (4) $ 3.96 3/20/2033 12,398 $ 49,096

Diana Diaz 6,216 12,434 (5) $ 2.46 10/16/2033 12,434 $ 30,588

Chief Financial Officer

(1) Options vest in equal annual installments over the three years after the option grant date.

Each option is subject to the condition that the optionee will have remained employed by the Company, or any one or more of its subsidiaries, through such vesting dates, and each option is further subject to the terms and conditions set forth in the Company’s 2022 Omnibus Incentive Plan and in the applicable stock option agreement.

Each option is subject to the condition that the optionee will have remained employed by the Company, or any one or more of its subsidiaries, through such vesting dates.

The relevant grant dates are indicated in the footnotes below.

(2) Restricted stock units vest in equal annual installments over the three years after the restricted stock unit grant date.

Each restricted stock unit is subject to the condition that the recipient will have remained employed by the Company, or any one or more of its subsidiaries, through such vesting dates, and each restricted stock unit is further subject to the terms and conditions set forth in the Company’s 2022 Omnibus Incentive Plan and in the applicable restricted stock unit agreement.

Each restricted stock unit is subject to the condition that the recipient will have remained employed by the Company, or any one or more of its subsidiaries, through such vesting dates.

The relevant grant dates are indicated in the footnotes below.

(3) The grant date of this award was June 10, 2022.

(4) The grant date of this award was March 20, 2023.

(5) The grant date of this award was October 16, 2023.

Stock Option Grant Timing

The Company did not grant stock options or similar instruments to its named executive officers during 2024.

The Company has no set policy or practice regarding the timing of stock option awards or similar instruments in relation to the disclosure of material nonpublic information.

In general, the timing of stock option awards is dictated by the event or circumstance giving rise to the award and the schedules of the directors responsible for approving the award.

If, in the future, a stock option grant is made at a time that material nonpublic information exists, the directors approving the

award would be responsible for considering the anticipated effect of that information on our stock price and would take such effect into account when sizing and pricing the award.

Clawback Policy

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Any determinations made by the Board of Directors or a committee to which the Board’s authority under the Clawback Policy has been delegated shall be final and binding on all affected individuals.

Erroneously Awarded Compensation Analysis

As discussed below in the notes to the Company’s consolidated financial statements under the heading “Note 13 – Restatement,” the Company is restating its quarterly unaudited interim financial statements as of March 31, 2023, June 30, 2023 and September 30, 2023, for the three-month period ended March 31, 2023, the three- and six-month periods ended June 30, 2023 and for the three- and nine-month periods ended September 30, 2023, as well as certain financial information from 2022.

Under the Clawback Policy, in the event of an accounting restatement of financial statements due to the Company’s material noncompliance with any financial reporting requirement under the securities laws, the amount of Covered Compensation (as defined in the Clawback Policy) subject to recovery from an executive officer is the amount received in excess of the amount that would have been paid to the executive officer absent the restatement, calculated on a pre-tax basis.

The Clawback Policy defines “Covered Compensation” to include any non-equity incentive plan awards, bonuses paid from a bonus pool, cash awards, equity or equity-based awards, or proceeds received upon sale of shares acquired through an incentive plan, provided that such compensation is granted, earned, and/or vested based wholly or in part on the attainment of a financial performance measure.

Upon review and consideration, upon authority delegated by the Board of Directors, the Compensation Committee concluded that the revisions to the Company’s previously issued financial statements did not impact any financial metric utilized to determine Covered Compensation during the relevant periods.

As a result, the compensation committee determined that there was no erroneously awarded compensation to be recovered under the Company’s Clawback Policy as a result of the restatements.

Director Compensation

Director compensation for the year ended December 31, 2023, which was pro-rated for board members who served less than the entire service period during fiscal 2023, is shown in the table below:

Fees earned or

Non-employee director compensation for the year ended December 31, 2024 is shown in the table below:

Name Fees earned or

($)(1)(2) Total ($)

Richard Cohen 40,000 21,009 61,009

Antoinette R.

Leatherberry 53,500 21,009 74,509

Mistelle Locke 35,000 21,009 56,009

(1) Represents the aggregate grant date fair value computed in accordance with FASB ASC Topic 718, excluding the effect of estimated forfeitures.

The assumptions used in calculating these values are described in Note 2 to our consolidated financial statements included herein.

(2) Unvested restricted stock unit awards held by our non-employee directors as of December 31, 2023 are summarized below:

Shares to Award

Richard Cohen

June 10, 2022

The assumptions used in calculating these values are described in Note 2 — Basis of Presentation and Consolidation and Summary of Significant Accounting Policies to our consolidated financial statements included herein.

(2) Unvested restricted stock unit awards held by our non-employee directors as of December 31, 2024 are summarized in the following table:

Name Shares to Award

(#) Grant Date

Richard Cohen 16,462 June 10, 2022

16,410 June 12, 2023

Antoinette R.

June 10, 2022

Leatherberry 16,462 June 10, 2022

16,410 June 12, 2023

Mistelle Locke

January 16, 2023

Mistelle Locke 14,493 January 16, 2023

16,410 June 12, 2023

Locke was appointed to our Board on January 16, 2023.

Our non-employee director compensation policy is designed to enable us to attract and retain, on a long-term basis, highly qualified non-employee directors.

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We also reimburse our non-employee directors for reasonable travel and other expenses incurred in connection with attending our board of directors and committee meetings.

In February 2025, the Compensation Committee of the Board of Directors increased the annual retainer payable to all non-employee members of the Board of Directors from $30,000 to $40,000 effective January 1, 2025.

Equity Awards

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However, our board of directors has in recent years approved annual awards of restricted stock units to our non-employee directors.

Those awards generally vest (subject to the continued service of the grantee) in three equal annual installments, although vesting may accelerate in certain circumstances, such as in connection with a change in control.

2022 Omnibus Incentive Plan

General Information About the 2022 Plan

On January 17, 2022, our board of directors adopted and our stockholders approved the 2022 Plan.

The purpose of the 2022 Plan is to enable the Company to attract, retain and motivate its employees by providing for or increasing their proprietary interests in the Company.

The 2022 Plan is a stock incentive plan under which we may offer securities of the Company to our employees.

The 2022 Plan is not subject to any provisions of the U.S.

Employee Retirement Income Security Act of 1974 and is not

qualified under Section 401(a) of the Internal Revenue Code of 1986, as amended (the “Code”).

The 2022 Plan permits the Company to satisfy any awards under the 2022 Plan by distributing to participants (1) authorized and unissued shares of the Company’s common stock, (2) shares of common stock held in the Company treasury, (3) shares of the Company’s common stock purchased on the open market or (4) shares of the Company’s common stock acquired through private purchase.

Employees, directors, officers and consultants or advisors of the Company and its affiliates are eligible for awards under the 2022 Plan.

The Committee (as discussed below) has the sole and complete authority to determine who will be granted awards under the 2022 Plan.

Eligible individuals are not required to make contributions to the 2022 Plan in order to participate.

However, as described below, depending on what method is chosen to exercise any stock options granted, an individual may be required to make a cash payment to the Company upon that exercise.

In addition, the Company may require payment of some amount for the shares subject to a restricted stock award.

Administration

The 2022 Plan is administered by the Committee, which consists of the members of our compensation committee, or if our board of directors is acting as our compensation committee, the individuals constituting “eligible” directors of our board of directors.

The Committee administers the 2022 Plan, except in the case of awards to non-employee directors.

Awards to non-employee directors are administered by our board of directors.

The Committee in its discretion may delegate any and all of its duties to officers of the Company.

The Committee or, in the case of awards to non-employee directors, our board of directors, has the authority to determine the terms and conditions of any agreements relating to awards granted under the 2022 Plan (agreements may differ among participants), and to adopt, alter and repeal rules, guidelines and practices relating to the 2022 Plan.

The Committee or, in the case of awards to non-employee directors, our board of directors, has full discretion to administer and interpret the 2022 Plan, and to adopt whatever rules, regulations and procedures it deems necessary or advisable.

The Committee or, in the case of awards to non- employee directors, our board of directors, also has full discretion to determine, among other things, the times at which the awards may be exercised and under what circumstances an award may be exercised.

Plan Amendments

The 2022 Plan expires by its terms on the tenth anniversary of the effective date of the 2022 Plan.

However, our board of directors may terminate the 2022 Plan before that date.

No awards can be granted under the 2022 Plan after the 2022 Plan has terminated.

However, awards granted prior to the date on which the 2022 Plan terminates will not be affected by the termination and the terms and conditions of the 2022 Plan will continue to apply to those awards.

Our board of directors has the right to amend, alter, suspend, or terminate the 2022 Plan, even before the date on which the 2022 Plan is otherwise scheduled to terminate.

The Committee may also amend outstanding awards or cancel any award and provide a substitute award, subject to the participants’ consent.

However, neither our board of directors nor the Committee may amend or terminate the 2022 Plan or any outstanding awards in a manner that would impair rights of award holders without their written consent, unless the amendment is made to comply with applicable law, stock exchange rules, or accounting rules.

Shares Available for Awards

Shares Available for Issuance

The maximum number of shares of common stock that may be issued pursuant to awards granted under the 2022 Plan is 1,500,000, subject to certain adjustments for corporate transactions, as described in the section entitled “— Additional Information — Adjustments” below.

On termination, forfeiture, or expiration of an unexercised stock option grant or other award, in whole or in part, the number of shares of common stock subject to such unexercised stock option grant or other

award will become available again for grant under the 2022 Plan.

Also, shares subject to a stock option grant or other award that are not delivered to a participant because they are used to satisfy a tax withholding obligation or that are withheld to pay all or a portion of an option’s exercise price will again become available for grant under the 2022 Plan.

In addition, shares of the Company’s common stock will not be considered used if the award to which they relate is settled in cash.

Further, shares subject to awards granted in assumption or substitution of outstanding awards of an acquired entity shall not be counted against the shares of our common stock available for issuance under the 2022 Plan.

Stock Options

Stock options may be granted under the 2022 Plan.

The Committee sets the terms of the stock option grant at the time the grant is made.

These terms are described in a stock option award agreement.

The Committee, in its discretion, may designate stock options granted under the 2022 Plan as either nonqualified stock options or incentive stock options (“ISOs”).

ISOs have certain unique tax characteristics discussed below.

The stock option agreement will indicate whether the stock options are nonqualified stock options or ISOs.

Please note, however, that, even if all of the stock options are designated as ISOs, only those stock options so designated that first become vested and exercisable in a calendar year having an aggregate fair market value (determined at the date of grant) of $100,000 will be eligible to receive ISO tax treatment.

Any additional stock options that first become vested during that calendar year will be treated as nonqualified stock options for tax purposes.

Once a stock option vests, holders of stock options granted pursuant to the 2022 Plan will be able to exercise that stock option for a period determined by the Committee and set forth in their stock option agreement.

Although the period during which an option may be exercised may vary from award to award, the longest period of time for which an option will remain exercisable is ten years from the date it is granted.

If a participant’s employment terminates, the period during which they can exercise their vested stock options may change depending on the terms of their option agreement.

Restricted Stock Awards

Restricted stock awards may be granted under the 2022 Plan.

The Committee will set the terms of the restricted stock award at the time of grant and will describe these terms in a restricted stock award agreement.

If the specified performance criteria are not achieved within the established time frame, the shares will be forfeited, unless the terms of the applicable restricted stock award agreement also provide for service- based vesting, catch-up vesting or otherwise specifically alter this treatment.

Restricted Stock Units

Restricted stock unit awards may be granted under the 2022 Plan.

The Committee will set the terms of the restricted stock unit award at the time of grant and will describe these terms in a restricted stock unit agreement.

Stock Bonus Awards

Participants may receive under the 2022 Plan a grant of unrestricted shares of the Company’s common stock or other awards, including fully-vested deferred stock units, denominated in common stock, as determined by the Committee.

Cash Bonus Awards

Participants may also receive under the 2022 Plan a cash bonus award.

Any such award may be subject to a performance period, performance goals or such other terms and conditions as the Committee may designate in the applicable award agreement.

Stock Appreciation Rights

Stock appreciation rights may be granted under the 2022 Plan.

The Committee will set the terms of the stock appreciation right at the time of grant and will describe these terms in the applicable award agreement.

Additional Information

The 2022 Plan provides for appropriate adjustments in the number of shares of common stock subject to awards and available for future awards, the exercise price of outstanding awards, as well as the maximum award limits under the 2022 Plan, in the event of changes in our outstanding common stock by reason of a merger, stock split, reorganization, recapitalization or similar events.

The Committee may also make these types of adjustments if a change in law or circumstances would result in any substantial dilution or enlargement of the rights of participants under the 2022 Plan.

Repricing of options and SARs (as defined in the 2022 Plan) is generally prohibited under the 2022 Plan without approval of our stockholders.

Change in Control

Unless the applicable award agreement provides otherwise, in the event of a “change in control” (as defined in the 2022 Plan),

● if a participant’s employment or service with the Company is terminated by the Company without “cause” (as defined in the 2022 Plan) or by the participant for “good reason” (as defined in the 2022 Plan) within twelve months of a change in control of the Company or in contemplation of a change in control, all awards held by such participant become fully vested and immediately exercisable, and any applicable restricted period ends on the termination date;

● all incomplete performance periods in effect on the date the change in control occurs will end on the date of the change in control, and the Committee will determine the extent to which performance goals with respect to each such award period have been met based upon such audited or unaudited financial information then available as it deems relevant;

and each participant will be paid partial or full awards with respect to performance goals for each relevant award period based upon the Committee’s determination of the degree of attainment of any performance goals;

● the acquiring entity may choose to either (i) continue the terms and conditions of each award under the 2022 Plan, or (ii) replace the outstanding awards with a substantially equivalent award with respect to the acquiring entity’s stock;

● if an excise tax under Code Section 4999 will be triggered by any payments owed to a participant in connection with or contingent upon the change in control, the Company will reduce the aggregate amount of the payments payable to the participant such that no excise tax will be assessed, unless the after-tax payment, even with the excise tax, will be a greater value than the value resulting from the reduction and avoidance of the excise tax.

In the event of a change in control, the Committee may in its discretion also make adjustments to the stock options and restricted stock units granted under the 2022 Plan.

The Committee may substitute shares of the surviving entity or another corporation that is party to the transaction for shares of Company common stock.

In connection with such an event, the Committee may also determine that outstanding awards will be cancelled in return for a cash payment equal to the value of the cancelled awards.

In the event that the Committee decides to cancel outstanding awards, holders of outstanding awards will receive reasonable advanced notice.

Tax withholding

Participants, other than non-employee directors, in the 2022 Plan must make a cash payment to the Company, or make other arrangements satisfactory to the Committee, to satisfy the tax withholding obligations that arise under applicable law with respect to a stock option or other award granted under the 2022 Plan, including without limitation any U.S.

federal income and employment taxes and other applicable state and local taxes.

Under certain circumstances, participants may be permitted to satisfy their tax withholding obligation, in whole or in part, by having us withhold from the shares of common stock otherwise deliverable to them on the exercise of a stock option, restricted stock unit or stock appreciation right, or by surrendering shares having a fair market value on the date of exercise equal to the exercise price.

Transferability and assignment

In general, participants in the 2022 Plan can exercise an option or other award received under the 2022 Plan only during their lifetime.

Unless the agreement under which the stock option or other award was granted provides otherwise, participants cannot transfer stock options or other awards (except for shares that are not subject to a restricted period), except by will or the laws of descent and distribution or pursuant to a domestic relations order issued by a court of competent jurisdiction.

Award Termination;

The Committee has full power and authority to determine whether, to what extent and under what circumstances any award will be terminated or forfeited.

To the extent provided in the award agreement, if a participant is terminated for “cause” (as defined in the 2022 Plan), then any stock options or restricted stock units granted to such participant may be cancelled.

Awards granted under the 2022 Plan are also subject to any clawback, compensation recovery policy or minimum stock holding period requirement adopted by the Company.

Those awards generally vest over a period of time, typically one to three years and subject to the continued service of the grantee, although vesting may accelerate in certain circumstances, such as in connection with a change in control.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

9 unchanged sentences

In connection with our initial public offering, we issued to DDM one share of Class B Common Stock for each LLC Unit it owns.

The percentage of beneficial ownership of our Class A common stock and our Class B common stock is based on 3,795,199 shares of Class A common stock and 10,868,000 shares of Class B common stock issued and outstanding as of October 11, 2024 (the “Measurement Date”).

The percentage of beneficial ownership of our Class A Common Stock and our Class B Common Stock is based on 6,913,999 shares of Class A Common Stock and 10,868,000 shares of Class B Common Stock issued and outstanding as of March 25, 2025 (the “Measurement Date”).

DDM holds all of the issued and outstanding shares of our Class B Common Stock.

5 unchanged sentences

Shares of Class A

Shares of Class B

Stock Beneficially

Total Voting Power

Beneficially Owned

Owned Shares of Class B

Beneficially Owned Total Voting Power

Beneficially Owned

1 unchanged sentence

Direct Digital Management, LLC (1)

— — % 10,868,000 100 % 10,868,000 61.3 %

Named Executive Officers and Directors

Mark Walker, Chairman and Chief Executive Officer

1.0 % 5,489,000 (2)

50.5 % 5,557,193 31.3 %

Keith Smith, President and Director

2.2 % 5,379,000 (2)

49.5 % 5,531,003 31.2 %

Diaz, Chief Financial Officer

* — — % 14,613 *

Richard Cohen, Director

55,905 * — — % 55,905 *

Antoinette R.

Leatherberry, Director

55,812 * — — % 55,812 *

Mistelle Locke, Director

35,674 * — — % 35,674 *

All executive officers and directors as a group (8 persons)

6.5 % 10,868,000 100 % 11,312,508 63.8 %

* Less than 1%

10 unchanged sentences

(3) Includes:

(i) 6,217 shares of Class A common stock that can be acquired by Ms.

Diaz upon the exercise of stock options that are vested or vesting within 60 days of the Measurement Date and (ii) 6,217 shares of Class A common stock to be issued upon vesting of restricted stock units within 60 days of the Measurement Date.

60,540 shares of Class A Common Stock that can be acquired by Mr.

Walker upon the exercise of stock options that are vested or vesting within 60 days of the Measurement Date.

(4) Includes:

60,540 shares of Class A Common Stock that can be acquired by Mr.

Smith upon the exercise of stock options that are vested or vesting within 60 days of the Measurement Date.

(5) Includes:

6,217 shares of Class A Common Stock that can be acquired by Ms.

Diaz upon the exercise of stock options that are vested or vesting within 60 days of the Measurement Date.

(6) Includes:

155,947 shares of Class A Common Stock that can be acquired by all executive officers and directors upon the exercise of stock options that are vested or vesting within 60 days of the Measurement Date.

Equity Compensation Plan Information

1 unchanged sentence

Equity Compensation Plan Information

Number of securities

Plan Category Number of securities to be

issued upon exercise of

outstanding options,

warrants and rights Weighted-

exercise price of

options, warrants

and rights Number of securities

remaining available

for future issuance

Number of securities to be

exercise price of

compensation plans

issued upon exercise of

(excluding securities

outstanding options,

options, warrants

Plan Category

warrants and rights

Equity compensation plans approved by security holders 594,627 (1) $ 2.49 (2) 2,452,030 (3)

Equity compensation plans not approved by security holders — — —

Total 594,627 (1) $ 2.49 (2) 2,452,030 (3)

(1) Includes stock options and restricted stock units with respect to 335,883 and 258,744 shares of our common stock, respectively.

9 unchanged sentences

We intend to treat such redemptions or exchanges of LLC Units as the direct purchase of LLC Units by Direct Digital Holdings from DDM for U.S.

federal income and other applicable tax purposes, regardless of whether such LLC Units are surrendered by DDM to DDH LLC for redemption or sold to Direct Digital Holdings upon the exercise of our election to acquire such LLC Units directly.

A Basis Adjustment

may have the effect of reducing the amounts that we would otherwise pay in the future to various tax authorities to the extent that we have positive taxable income in a future tax period that is offset by tax depreciation or amortization deductions arising from such Basis Adjustment.

federal income and other applicable tax purposes, regardless of whether such LLC Units are surrendered by DDM to DDH LLC for redemption or

sold to Direct Digital Holdings upon the exercise of our election to acquire such LLC Units directly.

A Basis Adjustment may have the effect of reducing the amounts that we would otherwise pay in the future to various tax authorities to the extent that we have positive taxable income in a future tax period that is offset by tax depreciation or amortization deductions arising from such Basis Adjustment.

The Basis Adjustments may also decrease gains (or increase losses) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets, which could also generate tax savings for us.

17 unchanged sentences

Liability related to tax receivable agreement:

Short term $ 41 $ 41

Long term — 5,201

Total liability related to tax receivable agreement $ 41 $ 5,242

49 unchanged sentences

Our Class A Common Stock is listed on The Nasdaq Capital Market under the symbol “DRCT”.

Under the rules of The Nasdaq Capital Market, independent directors must comprise a majority of a listed company’s board of directors within a specified period of the completion of our initial public offering, which closed on February 15, 2022.

Under the rules of The Nasdaq Capital Market, independent directors must comprise a majority of a listed company’s board of directors.

In addition, the rules require that, subject to specified exceptions, each member of a listed company’s audit, compensation and nominating and corporate governance committees be independent.

4 unchanged sentences

or (2) be an affiliated person of the listed company or any of its subsidiaries.

In October 2024, our board of directors undertook a review of its composition, the composition of its committees and the independence of our directors and considered whether any director has a material relationship with us that could compromise his or her ability to exercise independent judgment in carrying out his or her responsibilities.

On March 18, 202 5, our board of directors undertook a review of its composition, the composition of its committees and the independence of our directors and considered whether any director has a material relationship with us that could compromise his or her ability to exercise independent judgment in carrying out his or her responsibilities.

Based upon information requested from and provided by each director concerning his or her background, employment and affiliations, including family relationships, our board of directors has determined that none of our non-employee directors has a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of these non-employee directors is “independent” as that term is defined under the rules of The Nasdaq Capital Market.

In October 2024, our board of directors also determined that Mr.

On March 18, 2025, our board of directors also determined that Mr.

Cohen and Mses.

2 unchanged sentences

Principal Accountant Fees and Services

A udit Fees and Services

Audit Fees and Services

As previously reported, the Audit Committee appointed BDO USA, P.C.

to serve as the Company’s registered public accounting firm for fiscal year ended December 31, 2023.

to serve as the Company’s registered public accounting firm for fiscal years ended December 31, 2024 and 2023.

The following table summarizes the fees BDO USA, P.C.

1 unchanged sentence

Years Ended December 31,

Fee Category 2024 2023

Audit Fees (1) (BDO USA, P.C.) $ 895,305 $ 850,763

Audit-Related Fees (2) — —

Total Fees $ 895,305 $ 850,763

_________________________________________________________

(1) Audit fees consist of fees billed for professional services rendered by BDO USA, P.C.

for the audits of our annual consolidated financial statements, the reviews of our interim consolidated financial statements, and related services that are normally provided in connection with statutory and regulatory filings or engagements.

Predecessor A udit Fees and Services

(2) Audit-related fees consist of fees for assurance and related services performed by BDO USA, P.C.

that are reasonably related to the performance of the audit or review of our financial statements and are traditionally performed by the independent registered public accounting firm.

These include services related to consultation with respect to special procedures required to meet certain regulatory requirements.

Predecessor Audit Fees and Services

Marcum LLP was our independent registered public accounting firm for the year ended December 31, 2022.

1 unchanged sentence

Years Ended December 31,

Fee Category 2024 2023

Audit Fees (1) (Marcum LLP) $ 119,069 $ 596,885

Audit-Related Fees (2) — 46,378

All Other Fees

Total Fees $ 119,069 $ 643,263

_________________________________________________________

(1) Audit fees consist of fees billed for professional services rendered by Marcum LLP for the audits of our annual consolidated financial statements, the reviews of our interim consolidated financial statements, and related services that are normally provided in connection with statutory and regulatory filings or engagements.

1 unchanged sentence

These include services related to consultation with respect to special procedures required to meet certain regulatory requirements.

(3) Tax fees consist of fees for professional services with respect to tax compliance, tax advice and tax planning.

Audit Committee Pre-Approval Policies and Procedures

15 unchanged sentences

Incorporated by Reference

Description Form File Number Date Exhibit No.

Filed or furnished

3.1 Amended and Restated Certificate of Incorporation of Direct Digital Holdings, Inc.

February 16, 2022

8-K 001-41261 February 16, 2022 3.1

3.2 Amended and Restated Bylaws of Direct Digital Holdings, Inc.

February 16, 2022

8-K 001-41261 February 16, 2022 3.2

4.1 Unit Purchase Option, dated February 15, 2022, issued by the Company to Roth Capital Partners, LLC .

February 16, 2022

8-K 001-41261 February 16, 2022 4.2

4.2 Description of the Registrant’s Securities.

10-K 001-41261 October 15, 2024 4.2

10.1 Second Amended and Restated Limited Liability Company Agreement of Direct Digital Holdings, LLC, dated as of February 15, 2022 .

February 16, 2022

8-K 001-41261 February 16, 2022 10.1

10.2 Tax Receivable Agreement, dated February 15, 2022, by and among the Company, Direct Digital Holdings, LLC and Direct Digital Management, LLC .

February 16, 2022

8-K 001-41261 February 16, 2022 10.2

10.3+ Direct Digital Holdings, LLC 2022 Omnibus Incentive Plan.

January 24, 2022

S-1 333-261059 January 24, 2022 10.3

10.4+ Amendment to Direct Digital Holdings, Inc.

2022 Omnibus Incentive Plan.

DEF 14A 001-41261 November 15, 2024 Annex A

10.5+ Form of Direct Digital Holdings, Inc.

Employee Restricted Stock Unit Award Agreement .

June 13, 2022

Employee Restricted Stock Unit Award Agreemen t.

8-K 001-41261 June 13, 2022 10.1

10.6+ Form of Direct Digital Holdings, Inc.

Employee Nonqualified Stock Option Award Agreement .

June 13, 2022

Employee Nonqualified Stock Option Award Agreemen t.

8-K 001-41261 June 13, 2022 10.2

10.7+ Form of Direct Digital Holdings, Inc.

Director Restricted Stock Unit Award Agreement .

June 13, 2022

Director Restricted Stock Unit Award Agreemen t.

8-K 001-41261 June 13, 2022 10.3

10.8+ Executive Employment Agreement, dated as of February 15, 2022, by and between Direct Digital Holdings, LLC and Mark Walker.

March 31, 2022

10-K 001-41261 March 31, 2022 10.1

10.9+ Executive Employment Agreement, dated as of February 15, 2022, by and between Direct Digital Holdings, LLC and Keith Smith.

March 31, 2022

10-K 001-41261 March 31, 2022 10.1

10.10+ Executive Employment Agreement, dated as of March 9, 2022, by and between Direct Digital Holdings, LLC and Anu Pillai.

March 31, 2022

10-K 001-41261 March 31, 2022 10.1

10.11+ Executive Employment Agreement, effective as of October 16, 2023, between Direct Digital Holdings, LLC and Diana Diaz.

October 18, 2023

Executive Employment Agreement, effective as of August 22, 2022, between Direct Digital Holdings, LLC and Maria Vilchez Lowrey .

8-K 001-41261 October 18, 2023 10.1

10.12+ Executive Employment Agreement, effective as of August 22, 2022, between Direct Digital Holdings, LLC and Maria Vilchez Lowre y.

10-K 001-41261 October 15, 2024 10.11

10.13 Term Loan and Security Agreement, dated as of December 3, 2021, by and among Direct Digital Holdings, LLC, as borrower, Orange142, LLC, Huddled Masses LLC, Colossus Media, LLC, and Universal Standards for Digital Marketing, LLC, as guarantors, Lafayette Square Loan Servicing, LLC, as administrative agent, and the various financial institutions signatory to the Term Loan and Security Agreement as lenders.

November 15, 2021

S-1 333-261059 November 15, 2021 10.2

10.14 First Amendment to Term Loan and Security Agreement, dated as of February 3, 2022, by and among Direct Digital Holdings, LLC, as borrower, Colossus Media, LLC, Huddled Masses LLC, Orange142, LLC, and Universal Standards for Digital Marketing, LLC, as guarantors, Lafayette Square Loan Servicing, LLC as administrative agent, and the various financial institutions signatory to the Term Loan and Security Agreement as lenders.

March 31, 2022

10-K 001-41261 March 31, 2022 10.2

10.15* Second Amendment and Joinder to Term Loan and Security Agreement, dated effective as of July 28, 2022, by and among Direct Digital Holdings, LLC, as borrower, Colossus Media, LLC, Huddled Masses LLC, Orange142, LLC, Universal Standards for Digital Marketing, LLC and Direct Digital Holdings, Inc., as guarantors, Lafayette Square Loan Servicing, LLC as administrative agent, and the various financial institutions signatory to the Term Loan and Security Agreement as lenders.

November 14, 2022

10-Q 001-41261 November 14, 2022 10.1

10.16 Third Amendment to Term Loan and Security Agreement, dated January 9, 2023, by and between Direct Digital, LLC, as borrower, Colossus Media, LLC, Huddled Masses LLC, Orange142, LLC, and Direct Digital Holdings, Inc., as guarantors, and Lafayette Square Loan Servicing, LLC, as administrative agent, and the various lenders thereto.

January 11, 2023

8-K 001-41261 January 11, 2023 10.2

10.17 Fourth Amendment to Term Loan and Security Agreement, dated October 3, 2023, by and between Direct Digital, LLC, as borrower, Colossus Media, LLC, Huddled Masses LLC, Orange142, LLC, and Direct Digital Holdings, Inc., as guarantors, and Lafayette Square Loan Servicing, LLC, as administrative agent, and the various lenders thereto.

October 10, 2023

8-K 001-41261 October 10, 2023 10.1

10.18 Fifth Amendment to Term Loan and Security Agreement, dated as of October 15, 2024, among Direct Digital Holdings, LLC, Lafayette Square Loan Services, LLC, as administrative agent, and the various lenders party thereto.

10-Q 001-41261 November 13, 2025 10.1

10.19 Sixth Amendment and Waiver to Term Loan and Security Agreement, dated December 27, 2024, by and between Direct Digital, LLC, as borrower, Colossus Media, LLC, Huddled Masses LLC, Orange142, LLC, and Direct Digital Holdings, Inc., as guarantors, and Lafayette Square Loan Servicing, LLC, as administrative agent, and the various lenders thereto.

8-K 001-41261 January 3, 2025 10.2

10.20 Early Opt-in Election, dated June 1, 2023, by and among Direct Digital Holdings, Inc., Direct Digital Holdings, LLC, Huddled Masses LLC, Colossus Media, LLC, Orange142, LLC, Lafayette Square Loan Servicing, LLC and Lafayette Square USA, Inc.

8-K 001-41261 June 6, 2023 10.1

10.21 Intercreditor Agreement, dated as of December 3, 2021, by and between Lafayette Square Loan Servicing, LLC and East West Bank.

January 18, 2022

S-1 333-261059 January 18, 2022 10.2

10.22 Exclusive License and Sale Agreement, effective as of November 9, 2022, by and between Colossus Media, LLC and SmartyAds, Inc.

November 15, 2022

8-K 001-41261 November 15, 2022 10.1

10.23 Credit Agreement, dated July 7, 2023, by and among the Company, Direct Digital Holdings, LLC, Huddled Masses LLC, Colossus Media, LLC, and Orange142, LLC, as borrowers, and East West Bank, as lender.

July 12, 2023

8-K 001-41261 July 12, 2023 10.1

10.24 Second Amendment to Credit Agreement, dated November 27, 2023, by and among the Company, Direct Digital Holdings, LLC, Colossus Media, LLC, Huddled Masses LLC, and Orange142, LLC, as borrowers, and East West Bank, as lender.

November 30, 2023

8-K 001-41261 November 30, 2023 10.1

10.25 Third Amendment to Credit Agreement, dated October 15, 2024, among Direct Digital Holdings, LLC, Huddled Masses LLC, Colossus Media, LLC and Orange 142, LLC, as borrowers, and East West Bank, as lende r.

10-Q 001-41261 November 13, 2024 10.2

10.26 Waiver and Fourth Amendment to Credit Agreement, dated December 27, 2024, by and among Direct Digital Holdings, Inc., Direct Digital Holdings, LLC, Colossus Media, LLC, Huddled Masses LLC, and Orange142, LLC, as borrowers, and East West Bank, as lender.

8-K 001-41261 January 3, 2025 10.1

10.27 Share Purchase Agreement, dated October 18, 2024, between Direct Digital Holdings, Inc.

and New Circle Principal Investments LLC.

8-K 001-41261 October 21, 2024 10.1

10.28 Registration Rights Agreement, dated as of October 18, 2024, between Direct Digital Holdings, Inc.

and New Circle Principal Investments LLC.

8-K 001-41261 October 21, 2024 10.2

16.1 Letter from Marcum LLP to the Securities and Exchange Commission, dated April 23, 202 4.

8-K 001-41261 April 23, 2024 16.1

19.1 Insider Trading Policy.

21.1 List of Subsidiaries.

23.1 Consent of BDO USA, P.C., independent registered public accounting firm.

Consent of Marcum LLP, independent registered public accounting firm.

31.1 Certification of the Chief Executive Officer of Direct Digital Holdings, Inc., pursuant to Rule 13a-14(a) of the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

5 unchanged sentences

97 Direct Digital Holdings, Inc.

Clawback Policy

Inline XBRL Instance Document

Inline XBRL Taxonomy Extension Schema

Inline XBRL Taxonomy Extension Calculation Linkbase

Inline XBRL Taxonomy Extension Definition Linkbase

Inline XBRL Taxonomy Extension

Inline XBRL Extension Presentation Linkbase

Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

Clawback Polic y.

10-K 001-41261 October 15, 2024 97

101.INS Inline XBRL Instance Document X

101.SCH Inline XBRL Taxonomy Extension Schema X

101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase X

101.DEF Inline XBRL Taxonomy Extension Definition Linkbase X

101.LAB Inline XBRL Taxonomy Extension X

101.PRE Inline XBRL Extension Presentation Linkbase X

104 Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) X

_________________________________________________________

+ Indicates management contract or compensatory plan required to be filed as an Exhibit.

7 unchanged sentences

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned hereunto duly authorized.

October 15, 2024

March 27, 2025

DIRECT DIGITAL HOLDINGS, INC.

2 unchanged sentences

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this Annual Report on Form 10-K has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

/s/ MARK WALKER

Chief Executive Officer, Chairman and

Signature Title Date

/s/ MARK WALKER Chief Executive Officer, Chairman and

Director (Principal Executive Officer)

October 15, 2024

/s/ KEITH SMITH

President and Director

October 15, 2024

Chief Financial Officer (Principal Financial and

March 27, 2025

/s/ KEITH SMITH President and Director March 27, 2025

DIAZ Chief Financial Officer (Principal Financial and

Accounting Officer)

October 15, 2024

/s/ RICHARD COHEN

October 15, 2024

March 27, 2025

/s/ RICHARD COHEN Director March 27, 2025

Richard Cohen

/s/ ANTOINETTE R.

October 15, 2024

LEATHERBERRY Director March 27, 2025

Antoinette R.

/s/ MISTELLE LOCKE

October 15, 2024

/s/ MISTELLE LOCKE Director March 27, 2025

Mistelle Locke

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures