Company: DGLY
Filing Date: 2025-01-24
Form Type: S-1
Source: 0001493152-25-003451
Chunk: 81

Company: DIGITAL ALLY, INC.
Filing Date: 2025-01-24
Form: S-1
Chunk 81
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 in new commercial 
 extension of credits and issued common stock with detachable warrants resulting in $2,194,745 in net cash proceeds. The cash proceeds      
 were partially offset by payments on outstanding loans including the payments on merchant advances.                                        |

Commitments:

We had $415,131 of cash and cash equivalents and net negative working capital of $13,181,861 as of September 30, 2024. Accounts receivable and other receivables balances represented $5,253,535 of our net working capital at September 30, 2024. We intend to collect our outstanding receivables on a timely basis and reduce the overall level during 2024, which would help to provide positive cash flow to support our operations during 2024. Inventory represents $2,325,118 of our net working capital at September 30, 2024. We are actively managing the level of inventory and our goal is to reduce such level during the balance of 2024 by our sales activities, the increase of which should provide additional cash flow to help support our operations during 2024.

Capital Expenditures:

We had the following material commitments for capital expenditures at September 30, 2024:

Lease commitments.Total lease expense under the five operating leases was approximately $160,751 and $360,934, during the three and nine months ended September 30, 2024, respectively.

| 54 |

The following sets forth the operating lease right of use assets and liabilities as of September 30, 2024:

| Assets:                                          |     |   |         |
|:-------------------------------------------------|:----|:--|--------:|
| Operating lease right of use assets              |     | $ | 515,538 |
| Liabilities:                                     |     |   |         |
| Operating lease obligations-current portion      |     | $ |  82,974 |
| Operating lease obligations-less current portion |     |   | 432,563 |
| Total operating lease obligations                |     | $ | 515,537 |

The components of lease expense were as follows for the nine months ended September 30, 2024:

| Selling, general and administrative expenses |     | $ | 360,934 |

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

| Year ending December 31:                         
 2024 (October 1, to December 31, 2024)           |     |   |   29,974 |   |
|: