Company: DGLY
Filing Date: 2025-08-18
Form Type: 10-Q
Source: 0001641172-25-024667
Chunk: 173

Company: DIGITAL ALLY, INC.
Filing Date: 2025-08-18
Form: 10-Q
Item: Part I, Item 8
Chunk 173
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 the resulting warrant derivative liability transitioned to change in fair value of warrant derivative liabilities through the condensed
consolidated statement of operations.

    29

The pre-funded warrants were
all exercised within days of their issuance therefore their total fair value was estimated to be $1,803 at the time of their exercise
which remained the same as their fair value as of the date of issuance. The following are the assumptions used in calculating the estimated
fair value of the pre-funded warrants to purchase Common Stock which were effective and exercisable upon issuance on February 13, 2025:

 SCHEDULE OF WARRANT MODIFICATION

    Pre funded warrants issuance date – February 13, 2025  assumptions 
  
    Volatility – range 
     110.1%
  
    Risk-free rate 
     4.27%
  
    Dividend 
     —%
  
    Remaining contractual term 
     0.03 years 
  
    Exercise price 
    $0.001 
  
    Common stock issuable under the warrants 
     49,075 

During the six months ended
June 30, 2025, the pre-funded warrants to purchase 49,075 shares of Common Stock were fully exercised. In conjunction with the exercise
of the pre-funded warrants, the Company transitioned the related warrant derivative liability totaling $1,803 to equity as of their exercise
date. The warrant derivative liability related to the pre-funded warrants was $-0- as of June 30, 2025.

The Series A warrants were
issued/activated on Warrant Shareholder Approval Date of May 6, 2025  and their total fair value was estimated to be $1,340,214
at the time of their issuance/activation. The following are the assumptions used in calculating the estimated fair value of the Series
A warrants to purchase Common Stock which were effective and exercisable upon the Warrant Shareholder Approval Date of May 6, 2025:

    Series A warrants
    issuance/activation date – May 6, 2025  assumptions 
  
    Volatility – range 
     158.07%
  
    Risk-free rate 
     3.87%
  
    Dividend 
     —%
  
    Remaining contractual term 
     5.0 years 
  
    Exercise price 
    $62.00 
  
    Common stock issuable under the warrants 
     347,796 

On June 27, 2025, the