Company: DGLY
Filing Date: 2025-01-16
Form Type: S-1/A
Source: 0001493152-25-002490
Chunk: 11

Company: DIGITAL ALLY, INC.
Filing Date: 2025-01-16
Form: S-1/A
Chunk 11
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 with the terms of the Offer such Selling Stockholder’s
pro rata portion of 35% of the Offered Securities, subject to certain conditions.

Furthermore, pursuant to the Purchase Agreement, within five (5) days of the signing the Purchase Agreement, (i) the Company’s board of directors (the “Board”) shall approve an amendment to the Company’s bylaws (the “Bylaws’) setting the quorum required for a special meeting of stockholders to one-third of all stockholders entitled to vote at such special meeting and (ii) the Company shall file with the SEC a preliminary proxy statement on Schedule 14A announcing a meeting of stockholders for the purpose of approving the Series A and Series B warrants issued by the Company on June 25, 2024. On November 6, 2024, the Company adopted Amendment No. 1 to Bylaws with the approval of the Board. The Bylaws were amended to reduce the quorum requirement at any meeting of the Company’s stockholders to thirty-three and one-third percent (33 1/3%) of the stock issued and outstanding and entitled to vote at such meeting.

Furthermore, in order to secure the Company’s obligations under the Notes, the Purchase Agreement provides that the Company shall cause its wholly owned subsidiaries, to the extent permitted under such subsidiaries’ existing obligations, to guarantee the payment of and performance of obligations under the Notes. The Company agreed to use best efforts to enter into subsidiary guarantees to that effect. On November 13, 2024, the Company entered into the Guarantee, by and among the Company and the Guarantors. Pursuant to the Guarantee, the Guarantors guarantee to the Selling Stockholders the prompt and complete payment and performance when due of the Obligations (as defined in the Guarantee).

Senior Secured Promissory Notes

The Notes will mature ninety (90) days following their issuance date (the “Maturity Date”) and shall accrue no interest unless and until an Event of Default (as defined in the Notes) has occurred, in which case interest shall accrue at a rate of 14% per annum during the pendency of such Event of Default. In addition, upon customary Events of Default, the Selling Stockholders may require the Company to redeem all or any portion of the Notes in cash with 125% redemption premium. The Selling Stockholders may also require the Company to redeem all or any portion of the Notes in cash upon a Change of Control, as defined in the Notes, at the