Company: DGLY
Filing Date: 2025-05-20
Form Type: 10-Q
Source: 0001641172-25-011765
Chunk: 103

Company: DIGITAL ALLY, INC.
Filing Date: 2025-05-20
Form: 10-Q
Item: Part I, Item 1
Chunk 103
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 rules
and forms.

As part of our plan to remediate
our controls which were not effective, we are performing a full review of our internal control procedures. We have implemented, and plan
to continue to implement, new controls and new processes. We have hired and plan to continue to hire additional qualified personnel and
establish more robust processes to support our internal control over financial reporting, including clearly defined roles and responsibilities.
The Company anticipates time being required to complete the implementation and to assess and ensure the sustainability of these controls.
The effectiveness will not be considered remediated until the applicable controls operate for a sufficient period of time and management
has concluded, through testing, that these controls are operating effectively.

Changes in Internal Control
over Financial Reporting

There have not been any changes in the Company’s
internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during the
Company’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, its internal control
over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings.

The information regarding certain
legal proceedings in which we are involved as set forth in Note 9 – Commitments and Contingencies of the Notes to the Condensed
Consolidated Financial Statements (Part I, Item 1 of this Quarterly Report on Form 10-Q) is incorporated by reference into this Item 1.

In addition to such legal proceedings,
we are faced with or involved in various other claims and legal proceedings arising in the normal course of our businesses. At this time,
we do not believe any material losses under such other claims and proceedings to be probable. While the ultimate outcome of such claims
or legal proceedings cannot be predicted with certainty, it is in the opinion of management, after consultation with legal counsel, that
the final outcome in such proceedings, in the aggregate, would not have a material adverse effect on our consolidated financial condition,
results of operations or cash flows.

Item 1A. Risk Factors.

As a smaller reporting company,
we are not required to provide the information required by this Item.

Item 2. Unregistered Sales of Equity Securities
and Use of Proceeds.

There were no unregistered sales
of equity securities during the three months ended March 31, 2025 that were not disclosed by the Company on a Current Report on Form 8-K.

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Item 3. Defaults upon Senior Securities.

There