Company: DBRG
Filing Date: 2025-05-01
Form Type: 10-Q
Source: 0001679688-25-000043
Chunk: 27

Company: DigitalBridge Group, Inc.
Filing Date: 2025-05-01
Form: 10-Q
Item: Item 1
Chunk 27
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able equity securities comprise publicly listed stocks in the U.S. and Europe, and primarily in the digital infrastructure, real estate, technology, media and telecommunications sectors. The other equity investment, classified as level 3, was valued at March 31, 2025 using a market approach that considers revenue multiples of other comparable companies.Fair Value OptionEquity Method InvestmentsThe Company has elected to account for a co-investment in a portfolio company as an equity method investment under the fair value option. Fair value was determined using a discounted cash flow model based upon projected earnings using a discount rate of 11.0% at both March 31, 2025 and December 31, 2024. The fair value is classified as Level 3 of the fair value hierarchy and changes in fair value are recorded in principal investment income. DBRG Stock WarrantsThe Company previously issued five warrants to affiliates of Wafra, Inc. (collectively "Wafra"), a private investment firm in connection with Wafra's investment in the Company's investment management business in 2020. Wafra's investment was subsequently redeemed in 2022, with the warrants remaining outstanding. Each warrant entitled Wafra to 

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purchase up to 1,338,000 shares of the Company's class A common stock at staggered strike prices between $9.72 and $24.00 each, exercisable through July 17, 2026.The terms of the warrant purchase agreement provided for net cash settlement upon exercise of the warrants, at election of either the Company or Wafra, if such exercise would result in Wafra beneficially owning in excess of 9.8% of the issued and outstanding shares of the Company's class A common stock. Inclusion of the cash settlement feature resulted in the warrants being classified as a liability. Accordingly, the warrants were carried at fair value with changes in fair value recorded in other gain (loss) on the consolidated statements of operations. In March 2024, three of the five warrants were reclassified to equity at their prevailing fair value following an amendment to the terms of the warrants in connection with a sale of the three warrants by Wafra to a third party. The three equity-classified warrants are no longer subject to fair value remeasurement. No warrants have been exercised to-date.At March 31, 2025, the two liability-classified warrants were carried at fair value, measured using a Black-Scholes option pricing model, applying the following inputs: (