As used in this section, unless the context otherwise requires, references to "we," "our," "us," and "our company" refer to DSG Global, Inc. a Nevada corporation, together with our consolidated subsidiaries,
? the stability, availability and cost of international shipping services;
? our ability to establish and maintain dealership network for our electric
? our ability to attract and retain customers;
? the availability of adequate manufacturing facilities for our PACER golf
markets like electric vehicles, commercial fleet management and agriculture;
? the stability of general economic and business conditions, including changes
? the Company's ability to obtain financing to execute our business plans, as
and when required and on reasonable terms;
? our ability to accurately assess and respond to market demand in the electric
? our ability to attract and retain qualified employees and key personnel;
? our ability to maintain, protect and enhance our intellectual property;
? our ability to comply with evolving legal standards and regulations,
particularly concerning requirements for being a public company.
? the ability of our Chairman, President and Chief Executive Officer to control
? our ability to complete an offering of our common stock and warrants pursuant
to the Registration Statement on Form S-1 filed by with the Securities and
Exchange Commission on April 21, 2021 (the "Offering") and the concurrent
listing of our common stock and of the warrants on the Nasdaq Capital Market..
? the immediate and substantial dilution of the net tangible book value of our
common stock by the Offering;
? our ability to meet the initial or continuing listing requirements of the
? our intention to effect a reverse stock split of our outstanding common stock
immediately following the effective date of the Offering but prior to the
Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions, which may have been used.
DSG Global, Inc. (formerly Boreal Productions Inc.) was incorporated under the laws of the State of Nevada on September 24, 2007. We were formed to option feature films and TV projects to be packaged and sold to movie studios and production companies.
On August 12, 2021, the Company incorporated Imperium Motor of Canada Corporation ("Imperium Canada"), under the laws of British Columbia, Canada, for which it subscribed to all authorized capital stock, 100 shares of Class A Voting Participating common shares, at a price of $0.10 per share. Imperium Canada is a wholly owned subsidiary of the Company.
VANTAGE TAG FLEET MANAGEMENT AND GOLF DIVISION
Vantage Tag Golf and Fleet Management Technologies
All new product development effort of Vantage TAG is following the same model: select the best of breed third-party hardware platform, design and produce custom proprietary accessories while focusing the bulk of the development efforts on vertical software application to address a very specific set of end-customer needs.
Once installed the vehicle owner utilizes the TAG software to locate the vehicle in real time using any computer, smartphone, or tablet that has an internet connection and perform various management operations.
? Internal battery utilizing Smart Power technology which charges the battery
only when the vehicle is running (gas) or being charged (electric)
? Pace of Play management and reporting which is a critical statistic for the
? Web based access on any computer, smartphone, or tablet
? Set up restricted zones to protect property, vehicles, and customers
? Real time tracking both on and off property (using Street Maps)
? Email alerts of zone activity
? Detailed usage reporting for improved maintenance, proper vehicle rotation, and
? Ability to enforce cart path rules which is key to protecting course on wet
? Modular system allows for hardware and feature options to fit any budget or
VTS's entry level alphanumeric golf information display
? Yardage displays for front, middle, back locations of the pin
? Messaging capabilities - to individual carts or fleet broadcast
? Smart battery technology to prevent power drain
The industry leading Infinity XL 12" HD - the most sophisticated display on the market.
? Integrated Food and Beverage ordering
? Interactive Scorecard with email capability
? No power drain with Smart Battery technology
? Option of steering or roof mount
? Generate advertising revenue and market additional services
Previous 'One to One' model vs the new R3 model 'Many to One'
? Can be installed on any turf, utility, or service vehicle
? Work activity tracking and management
? Work breakdown and analysis per area, work group, activity type or specific
? Detailed travel (cutting patterns) history
? Detailed usage reports with mileage and hours
? Protection for ecological areas through geo fencing
? Vehicle lock down and 'off property' locating features
The TAG Turf provides detailed trail history and cutting patterns
DSG derives revenue from four different sources.
Systems Sales Revenue, which consists of the sales price paid by those customers who purchase our TAG system hardware lease our TAG system hardware.
Monthly Service Fees are paid by all customers for the wireless data fee charges required to operate the GPS tracking on the TAG systems.
Monthly Rental Fees are paid by those customers that rent the TAG system hardware. The amount of a customer's monthly payment varies based on the type of equipment rented (a TAG, a TAG and INFINITY 7", or a TAG and INFINITY XL 12").
The market for the TAG System is the worldwide golf cart and Turf equipment fleets. There are 40,000 golf courses around the world with North America being the largest individual market with 20,000. This represents over 3,000,000 vehicles. The golf market has five distinct types of operations. Municipal, Private Country Clubs, Destination Resorts, Public Commercial, Military and University affiliated. VTS has deployed and has case studies developed TAG systems in each of these categories.
Our marketing strategy is focused on building brand awareness, generating quality leads, and providing excellent customer service.
DSG focuses on select global golf markets that offer significant volume opportunities and that value the benefits that our products deliver.
Currently DSG is focused on expanding in Europe, Asia and South Africa. The Company plans to expand next into Australia, New Zealand and Latin America.
DSG has dedicated a team to create specific collateral for this market and has assigned a senior executive to have direct responsibility to manage these relationships.
However, there can be no assurance that even if we do these things, we will be able to compete effectively with the other companies in our industry.
Our Operations Department's main functions are outlined below:
Another benefit of the simplified installation procedure is increased scalability in anticipation of increased number of installs in the future by reducing the skill level and training time requirements for additional contractors.
In addition, DSG began offering the DSG Par 72 Service & Support Plan to guarantee service and support to client courses in the golf business, during fiscal 2016. This program for client courses which guarantees service and support programs within 24 hours of a problem arising.
All hardware development (electronics and mechanical) is generally outsourced, however small projects like mounting solutions or cabling are handled in house.
The Vantage TAG PACER Golf Cart
On February 4, 2020, we announced the establishment of our automotive subsidiary, Imperium Motor Company®, and a planned Electric Vehicle (EV) Experience Centre in California. Imperium Motor Company was incorporated in the State of Nevada on September 10, 2020.
? BATTERY 60-volt 600 Ah Maintenance Free Lead Acid or Lithium Battery Pack
? EQUIPPED with Automatic Transmission, Alloy Wheels, Air Conditioning, Heater,
Power Windows, Power Door Locks, Rear Camera, Push Button Start, Rear Hatch
Am-Fm USB/SD Stereo and more
[[Image Removed]] IMPERIUM Urbee 4S
[[Image Removed]] IMPERIUM Urbee 2S
[[Image Removed]] IMPERIUM Urbee Cargo Van
[[Image Removed]] IMPERIUM Five Star Van
[[Image Removed]] IMPERIUM e-Rickshaw Extended Deluxe
[[Image Removed]] Imp-Moto Product Lineup
Imperium has exclusive distribution rights in the United States, Canada, Mexico and the Caribbean for Jonway built EVs.
Skywell New Energy Automobile Group Co. Ltd.
Imperium Motor Company Experience Center
EV sales in Latin America increased by 90% in 2018 due to growing demand in Mexico, Colombia and Costa Rica. While the Latin American EV market is far smaller than East Asia, Europe and North America, accounting for less than 1% of global EV sales in 2018, it is starting to grow thanks to a handful of incentives and targets. Mexico and Costa Rica, for example, exempt EVs from numerous taxes while Colombia has an ambitious target of 600,000 EVs on its roads by 2030.
The case for EVs is strong in Bermuda, as it is across the Caribbean. With predominantly flat terrain and driving distances that are short enough to eliminate "range anxiety," EVs make perfect sense.
Competition in the EV Market
On January 29, 2021, the Company issued a preliminary prospectus (the "Registration Statement") to offer and sell up to 10,000,000 common shares, which will consist of up to 3,000,000 common shares issuable upon exercise of outstanding warrants, and up to 7,000,000 common shares upon conversion of certain Series F Preferred shares of the Company.
During the period ended June 30, 2022, the Company made required payments in the amount of $20,411, which was applied against the loan payable.
DSG owns two U.S. patents:
? US Patent No. 8,836,490 for a "Vehicle Management" was issued September 16,
? US Patent No. 9,280,902 for a "Facilities Management" was issued March 8, 2016
We have registered and own the domain name of our websites www.vantage-tag.com, www.dsgtglobal.com, and www.imperiummotorcompany.com.
We own the common law copyright in the contents of our websites (www.vantage-tag.com, www.dsgtglobal.com, www.imperiummotorcompany.com) and our various promotional materials.
Components of Our Results of Operations
We derive revenue from four different sources, as follows:
? Systems sales revenue, which consists of the sales price paid by those
customers who purchase or lease our TAG system hardware.
? Monthly service fees are paid by all customers for the wireless data fee
charges required to operate the GPS tracking on the TAG systems.
? Monthly rental fees are paid by those customers that rent the TAG system
hardware. The amount of a customer's monthly payment varies based on the type
? Programmatic advertising revenue is a new source of revenue that we believe
has the potential to be strategic for us in the future. We are in the process
of implementing and designing software to provide advertising and other media
functionality on our INFINITY units.
? Electronic fleet sales revenue is a new source of revenue which consists
primarily of wholesale distribution sales of our electronic fleet including
Our revenue recognition policies are discussed in more detail under "Note 3 - Summary of Significant Accounting Policies" in the notes to our Condensed Consolidated Financial Statements included in Part I, Item 1 of this Form 10-Q.
Our cost of revenue consists primarily of hardware purchases, wireless data fees, mapping, installation costs, freight expenses and inventory adjustments.
? Hardware purchases. Our equipment purchases consist primarily of TAG system
control units, TEXT display, and INFINITY displays. The TAG system control
unit is sold as a stand-alone unit or in conjunction with our TEXT
alphanumeric display or INFINITY high definition "touch activated" display.
Hardware purchases also include costs of components used during installations,
such as cables, mounting solutions, and other miscellaneous equipment.
? Wireless data fees. Our wireless data fees consist primarily of the data fees
charged by outside providers of GPS tracking used in all of our TAG system
? Mapping. Our mapping costs consist of aerial mapping, course map, geofencing,
and 3D flyovers for golf courses. This cost is incurred at the time of
? Installation. Our installation costs consist primarily of costs incurred by
our employed service technicians for the cost of travel, meals, and
miscellaneous components required during installations. In addition, these
costs also include fees paid to external contractors for installations on a
? Electronic fleet purchases. Our electronic fleet purchases consists of the
landed cost of electronic vehicles, e-bikes and e-scooters which includes the
cost of the unit, and any relevant freight and import fees.
? Freight expenses and Inventory adjustments. Our freight expenses consist
primarily of costs to ship hardware to courses for installations. Our
inventory adjustments include inventory write offs, write downs, and other
general and administrative, warranty, foreign currency exchange, and finance
costs. Our operating expenses consist primarily of sales and marketing,
salaries and wages, consulting fees, professional fees, trade shows, software
development, and allocated costs. Allocated costs include charges for
facilities, office expenses, telephones and other miscellaneous expenses. Our
other income (expenses) primarily consists of financing costs and foreign
? Compensation expense. Our compensation expenses consist primarily of personnel
costs, such as employee salaries, payroll expenses, and employee benefits.
This includes salaries for management, administration, engineering, sales and
marketing, and service support technicians. Salaries and wages directly
related to projects or research and development are expensed as incurred to
? General and administrative. Our general and administrative expenses consist
primarily of sales and marketing, commissions, travel, trade shows, consultant
fees, insurance, and compliance and other administrative functions, as well as
accounting and legal professional services fees, allocated costs and other
corporate expenses. Sales and marketing includes brand marketing, marketing
? Warranty expense (recovery). Our warranty expenses consist primarily of
associated material product costs, labor costs for technical support staff,
? Bad debt. Our bad debt expense consists primarily of amounts written down for
doubtful accounts recorded on trade receivables.
? Depreciation and amortization. Our depreciation and amortization costs consist
primarily of depreciation and amortization on fixed assets, equipment on lease
? Foreign currency exchange. Our foreign currency exchange consists primarily of
foreign exchange fluctuations recorded in Canadian dollar (CAD), British
expense, investor commission fees, and other financing charges for obtaining
The following table summarizes key items of comparison and their related increase (decrease) for the three months ended June 30, 2022, and 2021:
Comparison of the six months ended June 30, 2022, and 2021:
General & administration expense increased by $145,247 or 13.2% for the six months ended June 30, 2022, compared to the six months ended June 30, 2021. The table below outlines the differences in detail:
Gain (Loss) on extinguishment of debt
We had cash in the amount of $1,576,718 as of June 30, 2022, as compared to $275,383 as of December 31, 2021. We had a working capital deficit of $3,865,530 as of June 30, 2022 compared to working capital deficit of $2,314,163 as of December 31, 2021.
Our financial position as of June 30, 2022, and December 31, 2021, and the changes for the periods then ended are as follows:
Net Cash Used in Operating Activities.
Net Cash Used in Investing Activities.
The Company purchased equipment for $8,892, and disposed of equipment for proceeds of $10,225.
Net Cash Provided by Financing Activities.
Our current indebtedness as of June 30, 2022 is comprised of the following:
? Unsecured, convertible note payable to a former related party with an
outstanding principal amount of $310,000, bearing interest at 5% per annum,
? Senior secured, convertible note payable with an outstanding principal amount
of $Nil, and a carrying value of $9,487 relating to an outstanding penalty;
? Unsecured, promissory note with carrying value of $1,897,500 and outstanding
principal amount of $2,400,000, bearing interest at 9% per annum and 24% per
annum in default, maturing June 20, 2022. If not repaid by December 12, 2021,
an additional $100,000 of guaranteed interest will be added on December 12,
2021 and the 12th day of each succeeding month during which any portion of the
convertible note remains unpaid. In the event of a default, the note is
convertible at the price that is equal to a 40% discount to the lowest trading
price of the Company's common shares during the 30 day trading period prior to
(CAD$40,000). The loan is non-interest bearing and eligible for CAD$10,000
forgiveness if repaid by December 31, 2022. If not repaid by December 31,
2022, the loan bears interest at 5% per annum and is due on December 31, 2025;
? Unsecured loan payable with an outstanding principal amount of $31,935
(CAD$40,000). The loan is non-interest bearing and eligible for CAD$10,000
forgiveness if repaid by December 31, 2022. If not repaid by December 31,
2022, the loan bears interest at 5% per annum and is due on December 31, 2025;
? Unsecured loan payable with an outstanding principal amount of $30,115. The
loan bears interest at 1% per annum and is due on May 21, 2022 with payments
deferred for the first six months of the term;
? Secured loan payable with an outstanding principal amount of $150,000. The
loan bears interest at 3.75% per annum and is due on June 5, 2050. The loan is
secured by all tangible and intangible assets of Company. Fixed payments of
$731 are due monthly and begin 12 months from the date of the loan which is
applied against any accrued interest first.
? Series F Preferred Stock payments, two payments of $250,000 received on each
of February 28, 2022 and March 31, 2022. Until such time that the 5000 shares
of the Series F Preferred Stock are redeemed in full, an amount equal to 20%
of any gross proceeds collected by the Company are also required to be
remitted. Under the original terms of the SPA, redemption of preferred F
series shares requires a 15% premium payment on the face value. As such, a
Redemption Premium of $75,000 was recognized, and recorded as interest
expense, included as part of the loan, and will be repaid as part of the 20%
gross sales remittance. As at June 30, 2022, there was a balance of $482,651
On March 4, 2021, the Company issued an aggregate of 16 shares of Series B convertible preferred shares to the Company's board of directors for past services. These preferred shares were valued at $849,600 based on the fair value of the underlying common stock. The issuance is recorded under compensation expense.
The Series B preferred stock is convertible on a 1 for 100,000 basis into common shares.
On June 27, 2022, the Company issued an aggregate of 105 shares of Series B convertible preferred shares to the Company's board of directors for past services. These preferred shares were valued at $777,000 based on the fair value of the underlying common stock. The issuance is recorded under compensation expense.
The Series B preferred stock is convertible on a 1 for 100,000 basis into common shares.
We estimate our operating expenses and working capital requirements for the twelve-month period to be as follows:
We do not have any off-balance sheet arrangements.
Critical Accounting Policies and Estimates
We believe that the assumptions and estimates associated with revenue recognition, foreign currency and foreign currency transactions and comprehensive loss have the greatest potential impact on our consolidated financial statements. Therefore, we consider these to be our critical accounting policies and estimates. For further information on all of our significant accounting policies, see the notes to our condensed consolidated financial statements.
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