Company: DGLY
Filing Date: 2025-01-24
Form Type: S-1
Source: 0001493152-25-003451
Chunk: 61

Company: DIGITAL ALLY, INC.
Filing Date: 2025-01-24
Form: S-1
Chunk 61
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 balance for this trade name/trademark was $699,000 as of September 30, 2024.

Operating Loss

For the reasons stated above, our operating loss was $14,935,492 and $16,261,554 for the nine months ended September 30, 2024 and 2023, respectively, an improvement of $1,326,062 (8%). Operating loss as a percentage of revenues changed to 98% in the nine months ended September 30, 2024 from 73% in the same period in 2023.

Interest Income

Interest income decreased to $63,064 for the nine months ended September 30, 2024, from $84,071 in the same period of 2023, which reflects our change in cash and cash equivalent levels during the nine months ended September 30, 2024 compared to the same period in 2023. The Company held higher levels of cash and cash equivalents during the nine months ended September 30, 2023.

Interest Expense

We incurred interest expense of $2,505,536 and $2,480,947 during the nine months ended September 30, 2024 and 2023, respectively. The increase is attributable additional debt issued in late 2023 and during the nine months ended September 30, 2024 partially offset by the conversion of the convertible notes entered into in the second quarter of 2023, the payoff of the building debt upon sale of the building and the pay-off of the contingent earn-out notes associated with the four Nobility Healthcare acquisitions.

Other income (expense)

Other income (expense) decreased to $66,966 for the nine months ended September 30, 2024, from $76,180 during the nine months ended September 30, 2023, which reflects income related to a warehouse lease within the corporate headquarters which ceased in 2024 upon the sale of the building.

Change in Fair Value of Derivative Liabilities

During the second quarter of 2023, the Company issued detachable warrants to purchase a total of 1,125,000 shares of Common Stock in association with the two secured convertible notes previously described. The Company issued an additional 1,195,219 warrants in June 2024. The underlying warrant agreement terms provide for net cash settlement outside the control of the Company in the event of tender offers under certain circumstances. As such, the Company is required to treat these warrants as derivative liabilities which are valued at their estimated