Digital Brands Group Inc. shares were down 9% at $3.50 after the company said it has entered into definitive agreements for the issuance and sale of 1.3 million common shares and warrants to buy up to 1.3 million shares at $3.915 a share and accompanying warrant in a private placement.
The warrants are exercisable immediately upon issuance, have a term of five years and an exercise price of $3.80 a share.
The private placement is expected to close on or about Friday.
The proceeds from the offering are expected to be $5 million, before deducting the placement agent’s fees and other offering expenses payable by Digital Brands Group.
The company intends to use the proceeds from the offering for working capital purposes.
The stock hit its low of $3.21 on Dec. 1, and is down 54% in the past three months.