UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
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Item 8.01. Other Events.
As previously disclosed, Digital Brands Group, Inc. (the “Company”) attended a hearing before the Nasdaq Hearings Panel (the “Panel”) on September 8, 2022, at which hearing the Company presented its plan to evidence compliance with the $2.5 million stockholders’ equity and $1.00 bid price requirements for continued listing on The Nasdaq Capital Market (“Nasdaq”), as set forth in Nasdaq Listing Rules 5550(b)(2) (the “Equity Rule”) and 5550(a)(1) (the “Bid Price Rule”), respectively.
As previously disclosed, the Panel subsequently granted the Company’s request for continued listing on Nasdaq, subject to the Company evidencing compliance with the Bid Price Rule and the Equity Rule by November 17, 2022, and January 17, 2023, respectively, among other conditions.
On November 29, 2022, Nasdaq formally notified the Company that it had regained compliance with the Bid Price Rule.
The Company is filing this Current Report on Form 8-K to demonstrate compliance with the Equity Rule, as required by the final, January 17th, 2023, term of the Panel’s decision in this matter. As of the date of the filing of this report, the Company believes it has stockholders’ equity of at least $2.5 million and thereby satisfies all applicable criteria for continued listing on The Nasdaq Capital Market, including the Equity Rule.
The increase in stockholders’ equity is the result of i) the conversion of $8.1 million of debt held by Oasis Capital, LLC and FirstFire Global Opportunities Fund, LLC (the “Oasis/FirstFire Debt”) into common stock, ii) the elimination of an aggregate of $9.1 million of liabilities from the balance sheet, which includes $1.69 million of derivative liabilities that were eliminated upon the conversion of the Oasis/FirstFire debt and $7.9 million of contingent consideration that was eliminated following the Company’s settlement with the former owners of Harper & Jones, LLC, and iii) $9.15 million of net proceeds from the Company’s public offering that closed on December 1, 2022.
The Company is awaiting Nasdaq’s formal determination that the Company has evidenced compliance with all appliable continued listing criteria as required by the Panel’s decision and will provide an update once available.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| DIGITAL BRANDS GROUP, INC. | ||
| Date: January 12, 2023 | ||
| By: | /s/ John Hilburn Davis IV | |
| Name: | John Hilburn Davis IV | |
| Title: | President and Chief Executive Officer | |