Digital Ally Drops After Pricing Offering

Digital Ally declined Monday morning after the provider of digital video imaging and storage products priced a $3.0 million equity offering composed of common stock and warrants with institutional investors. The company has entered into a definitive securities purchase agreement with the investors under which it agreed to issue and sell, in a registered direct offering, an aggregate of 1 million shares of common stock at an offering price of $3.00, 10.4% lower than the share closing price Friday.

Shares were down 10.5% at $3.00 at 9:38 a.m. in New York. The offering is for expected gross proceeds of $3.0 million before deductions. For each share of common stock purchased, investors will receive two registered warrants, each with an exercise price of $3.36. The company will use the net proceeds to retire $1.0 million principal amount of its secured convertible debentures with an outstanding principal balance of $4.0 million and the entire $700,000 principal amount of its subordinated notes and the balance for general corporate purposes.

By Kristin Senesi