Company: DGLY
Filing Date: 2025-05-20
Form Type: 10-Q
Source: 0001641172-25-011765
Chunk: 57

Company: DIGITAL ALLY, INC.
Filing Date: 2025-05-20
Form: 10-Q
Item: Part I, Item 1
Chunk 57
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, 2024.

The gain on
extinguishment of liabilities was $682,345
for the three months ended March 31, 2024, reflects income related to the entertainment segment’s ability to negotiate down
payables and other contract obligations during the period. The Company utilized funds from the related party note payable to resolve
numerous outstanding payables at a discounted rate, the discount received was recognized as a gain on extinguishment of liabilities
in the condensed consolidated statement of operations for the three months ended March 31, 2024.

NOTE 15. NET INCOME (LOSS) PER SHARE

The calculation of the weighted
average number of shares outstanding and income (loss) per share outstanding for the three months ended March 31, 2025 and 2024 are as
follows:

 SCHEDULE OF WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING AND LOSS PER SHARE OUTSTANDING

    Three Months ended  March 31, 

    2025  
    2024 
  
    Numerator for basic and diluted income (loss) per share – Net loss attributable to common stockholders 
    $4,263,471  
    $(3,931,020)

    Denominator for basic income (loss) per share – weighted average shares outstanding 
     3,032,208  
     143,061 
  
    Dilutive effect of shares issuable upon conversion of convertible debt and the exercise of stock options and warrants outstanding 
     —  
     — 

    Denominator for diluted loss per share – adjusted weighted average shares outstanding 
     3,032,208  
     143,061 

    Net income (loss) per share: 

    Basic 
    $1.41  
    $(27.48)
  
    Diluted 
    $1.41  
    $(27.48)

Basic loss per share is based
upon the weighted average number of shares of Common Stock outstanding during the period. For the three months ended March 31, 2025 and
2024, all shares issuable upon conversion of convertible debt and the exercise of outstanding stock options and warrants were antidilutive,
and, therefore, not included in the computation of diluted loss per share.

    35

NOTE 16. COUNTRY STAMPEDE ACQUISITION

On March 1, 2024, Kustom 440,
entered into an Asset Purchase Agreement (the “