Company: DGLY
Filing Date: 2025-01-24
Form Type: S-1
Source: 0001493152-25-003451
Chunk: 194

Company: DIGITAL ALLY, INC.
Filing Date: 2025-01-24
Form: S-1
Chunk 194
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NOTE 11. FAIR VALUE MEASUREMENT

In accordance with ASC Topic 820 — Fair Value Measurements and Disclosures(“ASC 820”), the Company utilizes the market approach to measure fair value for its financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets, liabilities or a group of assets or liabilities, such as a business.

ASC 820 utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:

| ● | Level                                                                                                                 
 1 — Quoted prices in active markets for identical assets and liabilities                                              |
| ● | Level                                                                                                                 
 2 — Other significant observable inputs (including quoted prices in active markets for similar assets or liabilities) |
| ● | Level                                                                                                                 
 3 — Significant unobservable inputs (including the Company’s own assumptions in determining the fair value)           |

The following table represents the Company’s hierarchy for its financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2023 and 2022.

SCHEDULE OF FINANCIAL ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON RECURRING BASIS

|                                                                                           |     | December 31, 2023 |   |     |         |   |     |         |           |     |       |           |
|:------------------------------------------------------------------------------------------|:----|:------------------|:--|:----|:--------|:--|:----|:--------|----------:|:----|:------|----------:|
|                                                                                           |     | Level 1           |   |     | Level 2 |   |     | Level 3 |           |     | Total |           |
| Liabilities:                                                                              |     |                   |   |     |         |   |     |         |           |     |       |           |
| Warrant derivative liabilities                                                            |     | $                 | — |     | $       | — |     | $       | 1,369,738 |     | $     | 1,369,738 |
| Contingent consideration promissory notes and contingent consideration earn-out agreement |     |                   | — |     |         | — |     |         |   188,470 |     |       |   188,470 |
|                                                                                           |     | $                 | — |     | $       | — |