Company: DGLY
Filing Date: 2025-11-12
Form Type: 10-Q
Source: 0001493152-25-021680
Chunk: 123

Company: DIGITAL ALLY, INC.
Filing Date: 2025-11-12
Form: 10-Q
Item: Part I, Item 1
Chunk 123
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ory notes and merchant cash
    advances.

51

The
net result of these activities was an increase in cash of $339,046 to $793,360 for the nine months ended September 30, 2025.

Commitments:

We
have $793,360 of cash and cash equivalents and net negative working capital of $115,393 as of September 30, 2025. Accounts receivable
and other receivables balances represented $4,796,447 of our net working capital at September 30, 2025. We intend to collect our outstanding
receivables on a timely basis and reduce the overall level during 2025, which would help to provide positive cash flow to support our
operations during 2025 and beyond. Inventory represents $2,622,542 of our net working capital at September 30, 2025. We are actively
managing the level of inventory, and our goal is to reduce such level during 2025 by our sales activities, the decrease of which should
provide additional cash flow to help support our operations during 2025 and beyond.

Capital
Expenditures:

We
had the following material commitments for capital expenditures at September 30, 2025:

Lease
commitments. Total lease expense under the Company’s operating leases was approximately $546,797 during the nine months
ended September 30, 2025.

The
following sets forth the operating lease right of use assets and liabilities as of September 30, 2025:

    Assets: 

    Operating lease right of use assets, net 
    $1,496,418 
  
    Prepayment of rent 
     138,843 

    Total operating lease right of use asset 
    $1,635,261 
  
    Liabilities: 

    Operating lease obligations-current portion 
     248,012 
  
    Operating lease obligations-less current portion 
     1,248,406 
  
    Total operating lease obligations 
    $1,496,418 

Following
are the minimum lease payments for each year and in total.

    Year ending December 31: 

    2025 (October 1, 2025 through December 31, 2025) 
    $52,738 
  
    2026 
     381,251 
  
    2027 
     448,051 
  
    2028 
     364,652 
  
    2029 and