Company: DGLY
Filing Date: 2025-01-24
Form Type: S-1
Source: 0001493152-25-003451
Chunk: 256

Company: DIGITAL ALLY, INC.
Filing Date: 2025-01-24
Form: S-1
Chunk 256
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 Company’s Entertainment segment agreed to take, an advance for a sum of $ 200,000. Under the Agreement, the Company’s Entertainment segment has the right to reacquire the tickets for a cash amount of $ 220,000by November 1, 2024. The repurchase date was extended to December 1, 2024 by an amendment dated October 31, 2024.

The Company’s Entertainment segment intends to repurchase the tickets and has recorded the cash repurchase obligation amount of $ 220,000as the outstanding extension of credit balance as of September 30, 2024, with $ 20,000of such amount recorded as interest expense during the three and nine months ended September 30, 2024.

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.

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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