Company: DGLY
Filing Date: 2025-05-20
Form Type: 10-Q
Source: 0001641172-25-011765
Chunk: 107

Company: DIGITAL ALLY, INC.
Filing Date: 2025-05-20
Form: 10-Q
Item: Part I, Item 8
Chunk 107
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 with the Predecessor Registrant immediately before the
Merger.

The business of the Registrant,
Digital Ally, Inc. (with its wholly-owned subsidiaries, Digital Ally International, Inc., Shield Products, LLC, Digital Ally Healthcare,
LLC (“Digital Ally Healthcare”), TicketSmarter, Inc. (“TicketSmarter”), Worldwide Reinsurance, Ltd., Digital Connect,
Inc., BirdVu Jets, Inc., Kustom 440, Inc. (“Kustom 440”), Kustom Entertainment, Inc., and its majority-owned subsidiary Nobility
Healthcare, LLC, collectively, “Digital Ally,” “Digital,” and the “Company”), is divided into three
reportable operating segments: 1) the Video Solutions Segment, 2) the Revenue Cycle Management Segment and 3) the Ticketing Segment. The
Video Solutions Segment is our legacy business that produces digital video imaging, storage products, disinfectant and related safety
products for use in law enforcement, security and commercial applications. This segment includes both service and product revenues through
our subscription models offering cloud and warranty solutions, and hardware sales for video and health safety solutions. The Revenue Cycle
Management Segment provides working capital and back-office services to a variety of healthcare organizations throughout the country,
as a monthly service fee. The Ticketing Segment acts as an intermediary between ticket buyers and sellers within our secondary ticketing
platform, ticketsmarter.com, and we also acquire tickets from primary sellers to then sell through various platforms. The accounting guidance
on Segment Reporting establishes standards for reporting information regarding operating segments in annual financial statements and requires
selected information of those segments to be presented in financial statements. Such required segment information is included in Note
17.

Reverse Stock Split

On May 6, 2025,
the Company, acting pursuant to authority received at an annual meeting of its stockholders on December 17, 2024, filed with the
Secretary of State of the State of Nevada a certificate of amendment (the “Charter Amendment”) to its articles of
incorporation, as amended (the “Articles of Incorporation”), which effected a one-for-twenty reverse stock split (the
“Reverse Stock Split”) of all of the Company’s outstanding shares of common stock, par value $0.001 per share (the
“Common Stock”). Pursuant to the Charter Amendment, the Reverse Stock Split became effective as of 5:30 p.m. Eastern
Time on May 6, 2025. As a result of the Reverse Stock Split