DBGI's liquidation posture as of December 31, 2025 is deeply negative, consistent with MFFAIS-reported CLV/LLV of approximately -$24.1M and OLV of approximately -$21.0M. Total reported assets of $44.5M are dominated by items that carry near-zero liquidation recovery: goodwill of $5.8M (0% recovery), indefinite-lived intangibles of $16.0M (0% recovery), finite-lived intangibles net $1.3M (0% recovery), and prepaid expenses of $22.9M ($9.4M current, $13.5M noncurrent) consisting primarily of prepaid marketing assets that have no standalone liquidation value. Inventory of $3.1M at 60% haircut yields approximately $1.9M. Cash of $1.9M plus restricted cash of $5.7M (held in connection with marketing agreement obligations per Note 9 context, with recoverability contingent on counterparty release) contribute at most $7.7M. PP&E net is de minimis at $16K. Receivables net of $154K are inconsequential. Against these haircut assets, liabilities stand at face value of $35.7M current plus noncurrent: current liabilities of $26.1M include accounts payable $6.3M, accrued liabilities $5.6M, accrued payroll taxes $4.6M (elevated, likely indicates delinquent payroll obligations), interest payable $2.8M, long-term debt current $6.1M (includes $3.5M Bailey note matured December 8, 2025 and unpaid as of filing date per Note 17), and loans payable current $2.6M. Noncurrent liabilities include the share-based payment liability of $9.4M (liability-classified marketing agreements measured at fair value via Monte Carlo). Preferred stock liquidation preference of $31.5M sits ahead of common equity. Accumulated deficit is $155.4M. Net loss for fiscal 2025 was $28.3M on revenue of only $7.4M, a 36% YoY revenue decline. The $5.7M goodwill and intangible impairment charge in 2025 accelerated intangible asset erosion. The Bailey promissory note ($3.5M) is in technical default as of the filing date with no resolution disclosed, adding immediate execution risk to the liability stack. The Texas warehouse lease entered post-period (effective February 1, 2026, 89-month term, ~$6.9M total base rent) will materialize as a material ASC 842 ROU liability on the 2026 balance sheet, further worsening future liquidation posture. The filing discusses the marketing agreement make-whole provisions and the $27.0M contractual obligation figure (ContractualObligation) in MD&A but the $27.0M is tagged in XBRL; it aggregates multi-year marketing commitments that do not extinguish on windup. The restricted cash of $5.7M is tagged but its release mechanics are not separately XBRL-tagged.
▼ Community Notes