Company: DGLY
Filing Date: 2025-05-20
Form Type: 10-Q
Source: 0001641172-25-011765
Chunk: 128

Company: DIGITAL ALLY, INC.
Filing Date: 2025-05-20
Form: 10-Q
Item: Part I, Item 8
Chunk 128
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holders entitled to vote at such special
meeting and (ii) the Company shall file with the SEC a preliminary proxy statement on Schedule 14A announcing a meeting of stockholders
for the purpose of approving the Series A and Series B warrants issued by the Company on June 25, 2024.

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The senior secured promissory
notes mature ninety (90) days following their issuance date (the “Maturity Date”) and shall accrue no interest unless and
until an Event of Default (as defined in the senior secured promissory notes) has occurred, in which case interest shall accrue at a rate
of 14% per annum during the pendency of such Event of Default. In addition, upon customary Events of Default, the Purchasers may require
the Company to redeem all or any portion of the senior secured promissory notes in cash with a 125% redemption premium. The Purchasers
may also require the Company to redeem all or any portion of the senior secured promissory notes in cash upon a Change of Control, as
defined in the senior secured promissory notes, at the prices set forth therein. Upon a Bankruptcy Event of Default (as defined in the
senior secured promissory notes), the Company shall immediately pay to the Purchasers an amount in cash representing 100% of all outstanding
principal, accrued and unpaid interest, if any, in addition to any and all other amounts due under the senior secured promissory notes,
without the requirement for any notice or demand or other action by the Purchaser or any other person.

If the Company engages in one
or more subsequent financings while the senior secured promissory notes are outstanding, the Company will be required to use at least
100% of the gross proceeds of such financing to redeem all or any portion of the senior secured promissory notes outstanding. The Company
may also prepay the senior secured promissory notes in whole or in part at any time or from time to time. The senior secured promissory
notes also contain customary representations and warranties and covenants of each of the parties. Subject to certain exceptions, the senior
secured promissory notes are secured by a first lien and continuing security interest in and to the Collateral (as defined in the senior
secured promissory notes).

The net proceeds of the private
placement on November 7, 2024 was $2,669,250 (after $330,750 deduction of costs of