Company: DGLY
Filing Date: 2025-01-24
Form Type: S-1
Source: 0001493152-25-003451
Chunk: 211

Company: DIGITAL ALLY, INC.
Filing Date: 2025-01-24
Form: S-1
Chunk 211
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 required to treat these warrants as derivative liabilities which are valued at their estimated fair value at their issuance date and at each reporting date with any subsequent changes reported in the consolidated statements of operations as the change in fair value of warrant derivative liabilities. Furthermore, the Company re-values the fair value of warrant derivative liability as of the date the warrant is exercised with the resulting warrant derivative liability transitioned to change in fair value of warrant derivative liabilities through the consolidated statement of operations.

The Company has utilized the following assumptions in its Black-Scholes option valuation model to calculate the estimated fair value of the warrant derivative liabilities as of their date of issuance and as of December 31, 2023:

|                                          |     | Issuance date assumptions |             |   |     | December 31, 2023 assumptions |             |   |
|:-----------------------------------------|:----|:--------------------------|------------:|:--|:----|:------------------------------|------------:|:--|
| Volatility - range                       |     |                           |       106.0 | % |     | $                             |       105.4 | % |
| Risk-free rate                           |     |                           |        3.36 | % |     |                               |        3.84 | % |
| Dividend                                 |     |                           |           0 | % |     |                               |           0 | % |
| Remaining contractual term               |     |                           |   5.0 years |   |     |                               |   4.3 years |   |
| Exercise price                           |     |                           | 5.50 – 7.50 |   |     |                               | 5.50 – 7.50 |   |
| Common stock issuable under the warrants |     |                           |   1,125,000 |   |     |                               |   1,125,000 |   |

| F-37 |

The following table summarizes information about shares issuable under warrants outstanding during the years ended December 31, 2023 and 2022:

SUMMARY OF WARRANT ACTIVITY

|                                   |     | Warrants |            |   |     | Weighted       
 average        
 exercise price |        |   |
|:----------------------------------|:----|:---------|-----------:|:--|:----|:---------------|-------:|:--|
| Vested Balance, January 1, 2022   |     |          |  1,300,430 |   |