Company: DGLY
Filing Date: 2025-02-14
Form Type: 424B4
Source: 0001493152-25-006704
Chunk: 61

Company: DIGITAL ALLY, INC.
Filing Date: 2025-02-14
Form: 424B4
Chunk 61
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 to the reduction in new sponsorships being entered into by the Company offset by the goodwill and intangible asset impairment charge. Our selling, general and administrative expenses as a percentage of sales increased to 121% for the nine months ended September 30, 2024 compared to 98% in the same period in 2023. The significant components of selling, general and administrative expenses are as follows:

|                                                 |     | For the nine months ended  September 30, |       2024 |     |   |       2023 |
|:------------------------------------------------|:----|:-----------------------------------------|-----------:|:----|:--|-----------:|
| Research and development expense                |     | $                                        |  1,244,060 |     | $ |  2,039,361 |
| Selling, advertising and promotional expense    |     |                                          |  1,902,489 |     |   |  5,885,097 |
| General and administrative expense              |     |                                          | 10,462,747 |     |   | 13,845,074 |
| Goodwill and intangible asset impairment charge |     |                                          |  4,830,000 |     |   |          - |
| Total                                           |     | $                                        | 18,439,296 |     | $ | 21,769,532 |

Research and development expense.Our research and development expenses totaled $1,244,060 and $2,039,361 for the nine months ended September 30, 2024 and 2023, respectively which represents a decrease of $795,301 (39%). We have focused on controlling our expenditures on bringing new products to market, including updates and improvements to current products in response to our decline in revenues. The decrease in research and development expense reflects the large cut-back in our engineering staff and research activities in order to right-size our expenses in this area with our revenues.

Selling, advertising and promotional expenses.Selling, advertising and promotional expense totaled $1,902,489 and $5,885,097 for the nine months ended September 30, 2024 and 2023, respectively, a decrease of $3,982,608 (68%). The decrease in selling, advertising and promotional expenses reflects the large cut-back in selling staff and promotional and advertising activities in order to right-size our expenses in this area with our revenues. In addition, the decrease is attributable to the reduction in new sponsorships being entered into by