Company: DGLY
Filing Date: 2025-02-06
Form Type: S-1/A
Source: 0001493152-25-005144
Chunk: 197

Company: DIGITAL ALLY, INC.
Filing Date: 2025-02-06
Form: S-1/A
Chunk 197
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 and Payments shall continue until the earlier of (i) repayment of the Principal Sum, accrued Interest, and a fee of $35,000.00 or (ii) expiration of the Private Label Agreement on December 31, 2023.

During the year ended December 31, 2023, the Entertainment segment drew an additional $ 455,643on this agreement, with the principal balance never exceeding $ 1,000,000. During the year ended December 31, 2023, the Company’s Entertainment segment had repaid $ 1,367,715towards the principal on the loan through remittances and had an outstanding balance of $ 87,928.

Convertible Note

On April 5, 2023, the Company entered into and consummated the initial closing (the “First Closing”) of the transactions contemplated by a Securities Purchase Agreement, dated as of April 5, 2023 (the “Purchase Agreement”), between the Company and certain investors (the “Purchasers”).

At the First Closing, the Company issued and sold to the Purchasers Senior Secured Convertible Notes in the aggregate original principal amount of $ 3,000,000(the “Notes”) and warrants (the “Warrants”). The Purchase Agreement provided for a ten percent ( 10%) original interest discount resulting in gross proceeds to the Company of $ 2,700,000. No interest accrues under the Notes. The Warrants are exercisable for an aggregate 1,125,000shares comprised of 375,000warrants at an exercise price of $ 5.50per share of the Company’s common stock, par value $ 0.001(the “Common Stock”), 375,000warrants at an exercise price of $ 6.50per share of Common Stock, and 375,000warrants at an exercise price of $ 7.50per share of Common Stock.

Subject to certain conditions, within 18 months from the effectiveness date and while the Notes remain outstanding, the Purchasers have the right to require the Company to consummate a second closing of up to an additional $ 3,000,000of Notes (the “Second Notes”) and Warrants on the same terms and conditions as the First Closing, except that the Second Notes may be subordinate to a mortgage on the Company’s headquarters building (the “Bank Mortgage”).

The Notes are convertible into shares of Common Stock at the election of the Purchasers at any time at a fixed conversion price