Digital Ally , Inc. (NASDAQ:DGLY), a company specializing in radio and TV broadcasting and communications equipment, has filed corrections to its Articles of Incorporation with the Secretary of State of Nevada. The filings, made on October 28 and October 30, 2024, address a previous error by reinstating ten million shares of preferred stock into the company's capital structure.
The initial mistake occurred in a February 7, 2023, amendment to the company's Articles of Incorporation, which inadvertently omitted the preferred stock that had been authorized in the original articles. The first correction filed last Monday aimed to rectify this omission but was followed by a second correction due to a filing error.
The corrected filings now properly reflect Digital Ally's capital stock, including the preferred shares, ensuring the company's compliance with corporate regulations and its own charter. The details of the corrections are contained in Exhibits 3.1 and 3.2 of the 8-K filing, which are publicly available documents.
This adjustment comes without any changes to Digital Ally's fiscal year, which remains set to end on December 31. The company has provided no further details on the impact of these corrections or any related actions that may follow.
Investors and stakeholders can access the full text of the corrections in the exhibits attached to the company's recent 8-K filing. This news is based on a press release statement and provides factual information regarding Digital Ally's corporate governance.
In other recent news, Digital Ally, Inc. has experienced significant financial developments. The company reported a 148% increase in gross profits for fiscal year 2023, totaling $5,762,484, despite a 24% decrease in total revenues, which amounted to $28,248,344. Furthermore, Digital Ally finalized a $5.9 million property sale to Serenity Now, LLC.
The company also secured an additional $265,000 in funding from Mosh Man, LLC, extending the repayment date for a $100,000 obligation. Digital Ally raised about $2.9 million in gross proceeds through a private placement transaction facilitated by Aegis Capital Corp.
Digital Ally extended its merger agreement with Clover Leaf Capital Corp., aiming to expand its market presence. The company also secured a multi-year agreement with the Kansas City Chiefs to provide advanced security technology at GEHA Field at Arrowhead Stadium.
In terms of governance, Digital Ally was unable to conduct business at its Special Meeting due to a lack of quorum. Lastly, the company received a Default Notice from Softforge Innovation, LLC, accelerating all outstanding principal and interest payments under a note, totaling approximately $1.6 million. These are recent developments in the company's operations.
InvestingPro Insights
Digital Ally's recent corporate governance adjustments come amid challenging financial circumstances for the company. According to InvestingPro data, Digital Ally's market capitalization stands at a modest $3.82 million, reflecting its current struggles. The company's revenue for the last twelve months as of Q2 2024 was $23.42 million, with a concerning revenue decline of 29.76% over the same period.
InvestingPro Tips highlight that Digital Ally is "quickly burning through cash" and "operates with a significant debt burden." These factors may have contributed to the company's need for meticulous attention to its corporate structure, including the reinstatement of preferred stock options.
The stock's performance has been notably weak, with InvestingPro data showing a 62.25% price decline over the past year. This aligns with the InvestingPro Tip that the "stock has taken a big hit over the last six months."
For investors seeking a more comprehensive analysis, InvestingPro offers 13 additional tips for Digital Ally, providing deeper insights into the company's financial health and market position.
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