Company: DGLY
Filing Date: 2025-05-20
Form Type: 10-Q
Source: 0001641172-25-011765
Chunk: 74

Company: DIGITAL ALLY, INC.
Filing Date: 2025-05-20
Form: 10-Q
Item: Part I, Item 1
Chunk 74
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 Our assistance consists of insurance and benefit verification, medical treatment documentation and coding, and
collections. Through our expertise and experience in this field, we maximize our customers’ service revenues collected, leading
to substantial improvements in their operating margins and cash flows.

Our revenue cycle management segment
consists of our medical billing subsidiaries. Revenues of this segment are recognized after we perform the obligations of our revenue
cycle management services. Our revenue cycle management services are services, performed and charged monthly, generally based on a contractual
percentage of total customer collections, for which we recognize our net service fees.

Entertainment Operating Segment
- We also entered into live entertainment and events ticketing services through the formation of our wholly owned subsidiary, TicketSmarter
and its completed acquisitions of Goody Tickets, LLC and TicketSmarter, LLC, on September 1, 2021. TicketSmarter provides ticket sales,
partnerships, and mainly, ticket resale services through its online ticketing marketplace for live events, TicketSmarter.com. TicketSmarter
offers tickets for over 125,000 live events throughout the country through its platform, including concerts, sporting events, theatres,
and performing arts. We also offer production and promotion of live music events in third-party venues throughout the country. These services
begin with the logistical matters of an event, including artist booking and research, ticketing, staging, on-site operations, vendor sourcing,
and day of production.

Our entertainment operating segment
consists of entertainment services provided through TicketSmarter and its online platform, TicketSmarter.com. Revenues of this segment
include ticketing service charges generally determined as a percentage of the face value of the underlying ticket and ticket sales from
our ticket inventory which are recognized when the underlying tickets are sold. Entertainment direct expenses include the cost of tickets
purchased for resale by the Company and held as inventory, credit card fees, ticketing platform expenses, website maintenance fees, as
well as other administrative costs.

43

Off-Balance Sheet Arrangements

We do not have any off-balance
sheet debt, nor did we have any transactions, arrangements, obligations (including contingent obligations) or other relationships with
any unconsolidated entities or other persons that may have a material current or future effect on financial conditions, changes in the
financial conditions, results of operations, liquidity, capital expenditures, capital resources, or significant components of revenue
or expenses other than the following:

We are a party to operating leases
and license agreements that represent commitments for