Loan & DebtJun 15, 2026, 06:06 AM
Digital Brands Group Secures $238,050 Loan from 1800 Diagonal
AI Summary
Digital Brands Group, Inc. secured a loan of $238,050.00 from 1800 Diagonal Lending, LLC, evidenced by a promissory note with an original issue discount of $13,050.00, for a purchase price of $207,000.00. The company will make nine monthly payments of $29,624.00, including a 12% interest charge, with the note maturing on March 15, 2027. The agreement includes provisions for additional tranches up to $1,015,000.00 and outlines severe default terms, including a 150% repayment penalty and conversion into common stock at a discounted price, subject to ownership caps. The proceeds are intended for general working capital.
Key Highlights
- Digital Brands Group entered a securities purchase agreement with 1800 Diagonal Lending, LLC for a loan.
- The promissory note has an aggregate principal amount of $238,050.00, including an original issue discount of $13,050.00.
- The purchase price of the Note is $207,000.00, with potential additional tranches up to $1,015,000.00.
- The Company will make nine payments of $29,624.00, including a one-time 12% interest charge ($28,566.00).
- The Note matures on March 15, 2027, with the first payment due July 15, 2026.
- Upon default, the Note becomes due at 150% of outstanding principal plus accrued interest, plus 22% default interest.
- 1800 Diagonal can convert the default amount into common stock at 61% of the lowest bid price.
- 1800 Diagonal and affiliates cannot own more than 4.99% of outstanding common stock, and total conversion is capped at 19.99%.
- Proceeds from the loan will be used for general working capital purposes.
Price Impact
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