Company: DGLY
Filing Date: 2025-08-18
Form Type: 10-Q
Source: 0001641172-25-024667
Chunk: 35

Company: DIGITAL ALLY, INC.
Filing Date: 2025-08-18
Form: 10-Q
Item: Part I, Item 1
Chunk 35
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 Monthly principal and interest payments began
in November 2022, after being deferred for thirty months after the date of disbursement and total $731 per month thereafter. Such note
may be prepaid in part or in full, at any time, without penalty. The Company granted the SBA a continuing interest in and to any and all
collateral, including but not limited to tangible and intangible personal property.

Unsecured Promissory Note

On February 1, 2025, the Company’s
Entertainment Segment entered into a $600,000 unsecured promissory note with a third party. The promissory note bears an interest rate
of 10.0% per annum, compounded monthly. Payments of principal and interest were originally due on May 5, 2025, however the parties agreed
to extend the term for payments of principal and interest to begin July 1, 2025.

2024 Commercial Extension of Credit

On January 22, 2024, the Company’s
Entertainment segment entered an extension of credit in the form of a loan to use in marketing and operating its business in accordance
with the Ticket Solution Agreement. The Lender, Ticket Evolution, Inc., agreed to extend, subject to the conditions hereof, and Borrower
agreed to take, an advance for a sum of $75,000 with monthly advances of $100,000.

The advances made are recoupable
from client service fees with no more than $25,000 being recouped in any one week. The Company paid the remaining balance in full during
the six months ended June 30, 2025. The outstanding balance as of June 30, 2025 and December 31, 2024 was $-0- and $100,000, respectively.

Merchant Cash Advances – Video Solutions
Segment

In November 2023, the Company
obtained a short-term merchant advance, which totaled $1,050,000, from a single lender to fund operations. These advances included origination
fees totaling $50,000 for net proceeds of $1,000,000. The advance is, for the most part, secured by expected future sales transactions
of the Company with expected payments on a weekly basis. The Company will repay an aggregate of $1,512,000 to the lender. The loan bears
interest at 2.9% per week.

During the year ended December
31, 2024, the Company made