Company: DGLY
Filing Date: 2025-11-12
Form Type: PRER14A
Source: 0001493152-25-021783
Chunk: 27

Company: DIGITAL ALLY, INC.
Filing Date: 2025-11-12
Form: PRER14A
Chunk 27
---
 using performance-based compensation programs. No one component is considered by itself, but all forms of the compensation package are considered in total. Wherever possible, objective measurements will be utilized to quantify performance, but many subjective factors still come into play when determining performance.

| 16 |

Compensation Components.The main elements of its compensation package consist of base salary, stock options or restricted stock awards and bonus.

Base Salary.The base salary for each executive officer is reviewed and compared to the prior year, with considerations given for increase or decrease. The review is generally on an annual basis but may take place more often in the discretion of the Compensation Committee.

On January 31, 2024, the Compensation Committee approved the annual base salaries of Stanton E. Ross, Chief Executive Officer, Thomas J. Heckman, Chief Financial Officer, Treasurer and Secretary, and Peng Han, Chief Operating Officer, at $250,000, $120,000, and $250,000, respectively, for 2024. However, the officers voluntarily reduced their salaries throughout 2024 to the amounts indicated in the Summary Compensation Table to support the Company’s cash flow position.

The Compensation Committee plans to review the base salaries for possible adjustments on an annual basis. Base salary adjustments will be based on both the individual and our performances and will include both objective and subjective criteria specific to each executive’s role and responsibility with us.

Stock Options and Restricted Stock Awards. The Compensation Committee determined stock option and restricted stock awards
based on numerous factors, some of which include responsibilities incumbent with the role of each executive with us, tenure with us,
as well as our performance. The vesting period of options and restricted stock is also tied, in some instances, to our performance directly
related to certain executive’s responsibilities with us. The Compensation Committee determined that Messrs. Ross and Han were eligible
for awards of stock options or restricted stock in 2024 based on their performance. Refer to the “Grants of Plan-Based Awards”
table below for restricted stock awards made in 2024. The Committee also determined that Messrs. Ross, Heckman, and Han would be eligible
in 2024 for awards of restricted stock or stock options. On January 31, 2024, the Compensation Committee awarded Stanton E. Ross 200
shares of restricted common stock that will vest 100% on January 31, 2025 provided that he remains an officer on such dates. Peng Han
was awarded 150 shares of restricted common stock, of which 30 shares vested