Company: DGLY
Filing Date: 2025-05-20
Form Type: 10-Q
Source: 0001641172-25-011765
Chunk: 143

Company: DIGITAL ALLY, INC.
Filing Date: 2025-05-20
Form: 10-Q
Item: Part I, Item 8
Chunk 143
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 upon relevant stockholder approval
on December 17, 2024 which resulted in 238,339 common shares issuable under the Series B warrants with an exercise price of $0.001 per
share effective December 17, 2024. The Company recognized the full Series B warrant derivative liability value of $2,865,727 as of the
date of relevant stockholder approval when it became effective and exercisable of which $454,150 was recorded in equity and $2,411,577 was charged
as a loss in the consolidated statement of operations for the year ended December 31, 2024. The following are the assumptions used in
calculating the estimated fair value of the detachable Series B warrants to purchase Common Stock which became effective and exercisable
upon relevant stockholder approval on December 17, 2024 and on December 31, 2024:

    Series B issuance date - December 17, 2024  assumptions  
    Series B - December 31, 2024 assumptions 
  
    Volatility – range 
     105.5% 
     105.7%
  
    Risk-free rate 
     4.26% 
     4.38%
  
    Dividend 
     —% 
     —%
  
    Remaining contractual term 
     4.5 years  
     4.48 years 
  
    Exercise price 
    $0.001  
    $0.001 
  
    Common stock issuable under the warrants 
     238,339  
     189,689 

    30

During the year ended December
31, 2024, prefunded warrants to purchase 28,650 shares of Common Stock were fully exercised. No pre-funded warrants were exercised during
the three months ended March 31, 2025. In conjunction with the exercise of the Series B warrants, the Company transitioned the related
warrant derivative liability totaling $584,955 to equity as of their exercise date in 2024. The warrant derivative liability related to
the remaining unexercised Series B warrants was $1,989,806 as of December 31, 2024. The change in fair value of the Series B warrant derivative
liability from their issuance date through December 31, 2024 totaled $290,965 which was included as a loss in the condensed consolidated
statement of operations for the year ended December 31, 2024.

During the