Stanton E. Ross
DGLYAbout Stanton E. Ross
Stanton E. Ross is Chairman and Chief Executive Officer of Digital Ally, Inc., serving in both roles since September 2005; he was age 63 as of the November 2024 proxy and has been a director since 2005 . The company reported net losses of $18.9 million in 2022 and $25.5 million in 2023, indicating challenging financial performance over the recent period . Mr. Ross holds no public company directorships other than Digital Ally and Infinity Energy Resources within the last five years .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Digital Ally, Inc. | Chairman & CEO | 2005–present | Long-tenured CEO/Chair, micro-cap public company leadership |
| Infinity Energy Resources, Inc. | Chairman (since 2005); President (1992–2005; reappointed President 2006) | 1992–2005; 2006 | Led public oil & gas E&P; continued as Chairman; reappointed President in 2006 |
| Midwest Financial | Founder & President | 1991–1992 | M&A and financing for Midwest corporations |
| Duggan Securities, Inc. | Corporate finance (investment banking) | 1990–1991 | Corporate finance experience in Lenexa, KS |
| Stifel, Nicolaus & Co. | Investment Executive | 1989–1990 | Sell-side brokerage experience |
| Kansas Microwave, Inc. | Founder & President | 1985–1987 | Entrepreneurial leadership; radar detector product development |
| Birdview Satellite Communications, Inc. | Sales; National Sales Manager | 1981–1985 | Consumer satellite systems sales leadership |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Infinity Energy Resources, Inc. | Chairman; President | Chairman since 2005; President reappointed 2006 | Only other disclosed public company role; no other public directorships in last five years |
Fixed Compensation
| Metric | 2022 | 2023 |
|---|---|---|
| Base Salary ($) | $300,000 | $250,000 |
| Bonus Paid ($) | $100,000 | $0 |
| Stock Awards ($) | $374,500 (restricted stock grant fair value) | $87,325 (restricted stock grant fair value) |
| All Other Compensation ($) | $32,034 | $11,200 (401k) + $1,100 HSA + $821 insurance = $13,121 total |
| Total Compensation ($) | $806,534 | $348,525 |
Performance Compensation
| Item | 2022 Grant | 2023 Grant |
|---|---|---|
| Grant Date | January 7, 2022 | January 10, 2023 |
| Shares Granted | 17,500 restricted shares | 17,500 restricted shares |
| Grant Date Fair Value ($) | $374,500 (17,500 × $21.40) | $87,325 (17,500 × $4.99) |
| Vesting Schedule | 50% on Jan 7, 2023; 50% on Jan 7, 2024 (service-based) | 50% on Jan 10, 2024; 50% on Jan 10, 2025 (service-based) |
| Performance Metrics Tied to Pay | Not specifically disclosed; awards described as service/time-based; committee notes that some vesting may be tied to performance in some instances |
Vesting calendar and potential selling pressure:
| Vest Date | Shares Vesting |
|---|---|
| Jan 7, 2023 | 8,750 (50% of 2022 grant) |
| Jan 7, 2024 | 8,750 (remaining 2022 grant) |
| Jan 10, 2024 | 8,750 (50% of 2023 grant) |
| Jan 10, 2025 | 8,750 (remaining 2023 grant) |
Options: No options outstanding for Ross as of Dec 31, 2023; unvested restricted shares 26,250 .
Equity Ownership & Alignment
| Metric | Nov 14, 2024 (FY2024 proxy) | Feb 18, 2025 (Special Meeting proxy) |
|---|---|---|
| Total Beneficial Shares | 136,065 | 136,065 |
| Ownership % of Outstanding | 2.8% (4,884,541 shares outstanding) | 0.17% (79,251,318 shares outstanding) |
| Restricted Shares Subject to Forfeiture | 28,750 | 17,500 |
| Options Exercisable | 0 (none outstanding) | 0 (none outstanding) |
| Options Unexercisable | 0 (none outstanding) | 0 (none outstanding) |
- Pledging/hedging: No pledging or hedging noted for Ross in beneficial ownership disclosures/footnotes .
- Stock ownership guidelines: Not disclosed in the proxy .
Employment Terms
| Term | Details |
|---|---|
| Employment Agreement | None; covered by retention agreements (original 12/23/2008; amended April 2018) |
| Change-in-Control (CIC) Payment | $125,000 lump sum (3 months of base salary) upon successful completion of CIC if employed at completion |
| Severance (post-CIC, double-trigger) | 12 months base salary at higher of pre-termination or pre-Good Reason rate, lump sum; plus continuation of health benefits for 18 months; options fully vest and exercisable for 90 days post-termination |
| Good Reason Definition | Material adverse change in status/authority/duties; adverse change in base salary/target bonus/benefits; material geographic relocation |
| Cause Definition | Bad faith; failure to follow lawful material directions; misconduct/dishonesty/neglect/incompetence; embezzlement/fraud/theft; substance abuse affecting performance; certain crimes |
| Clawback / Non-compete / Non-solicit / Garden Leave | Not disclosed in proxy |
Board Governance
| Aspect | Details |
|---|---|
| Board Roles | Ross serves as both CEO and Chairman; Board believes combined role is in best interests, with Lead Independent Director oversight |
| Lead Independent Director | Leroy C. Richie; chairs executive sessions of independent directors; liaison and evaluation oversight |
| Independence | Each director other than Mr. Ross is independent under Nasdaq/SEC rules |
| Committees | Audit Committee: D. Duke Daughtery (chair/financial expert), Leroy C. Richie; Compensation Committee: Leroy C. Richie (chair), D. Duke Daughtery; Nominating & Governance Committee: Leroy C. Richie (chair), D. Duke Daughtery. Ross is not listed as a member of these committees |
| Board & Committee Meetings | Board held four meetings in FY2023; each director attended ≥75% of meetings/committees served |
Dual-role implications:
- CEO + Chairman concentration mitigated by Lead Independent Director structure and regular executive sessions of independent directors .
- Ross does not sit on audit/compensation/nominating committees, supporting committee independence .
Director Compensation
| Name | Fees Earned (2023) | Stock Awards (2023) | Option Awards (2023) | Total (2023) |
|---|---|---|---|---|
| Stanton E. Ross (Chairman/CEO) | $0 (no director compensation separate from NEO pay) | $0 | $0 | $0 |
Compensation Structure Analysis
- Cash vs equity mix: Ross’s total compensation declined from $806,534 in 2022 to $348,525 in 2023, driven by absence of bonus and smaller equity awards; base salary cut from $300,000 to $250,000 .
- Equity awards shifted to time-based RSUs; no option grants, and RSU vesting dates cluster in early January, which can create periodic liquidity/selling pressure windows (Jan 7 and Jan 10) .
- Committee oversight: Compensation Committee comprised of independent directors; no use of independent compensation consultant disclosed .
- Pay versus performance: “Compensation Actually Paid” to PEO shows negative adjustments driven by equity value declines; net loss widened to $25.5M in 2023 from $18.9M in 2022 .
Related Party Transactions
- No related party transactions involving Ross are disclosed; other transactions involved Nobility Healthcare and TicketSmarter, not Ross .
Risk Indicators & Red Flags
- Capital actions: Board sought authority for a reverse stock split (ranges 1:5 to 1:20 in Dec 2024 proxy; expanded to 1:5 to 1:100 in Mar 2025 special meeting proxy) and a substantial authorized share increase to 5.01 billion shares of capital stock (5.0 billion common) .
- Warrant-linked dilution: February 14, 2025 offering included Series A/B Warrants with reset/anti-dilution features; up to ~200 million shares could be issued at floor price scenarios; likely dilutive and potential overhang .
- Listing risk: Reverse split authority discussed to address Nasdaq minimum bid price compliance risks .
Investment Implications
- Alignment: Ross’s beneficial ownership is modest (136,065 shares), and as the share count expanded, his percentage fell from 2.8% (Nov 2024) to 0.17% (Feb 2025), which weakens alignment on a percentage basis despite constant share count .
- Retention/exit economics: Retention agreements provide a modest single-trigger CIC payment ($125k) and double-trigger severance of 12 months base plus 18 months health benefits; options would accelerate, but Ross reportedly has no outstanding options—net severance economics are limited relative to large-cap norms, suggesting low golden parachute risk .
- Trading signals: RSU vesting dates (Jan 7 and Jan 10 across 2023–2025) can create short-term selling pressure; monitor Form 4 filings around those dates for any disposals .
- Governance: Dual CEO/Chair role counterbalanced by an active Lead Independent Director and independent committees; however, sustained net losses and contemplated large-scale dilution warrant scrutiny of incentive structures and capital allocation .
- Dilution/overhang: Warrant adjustments and authorized share increase proposals materially increase dilution risk, likely pressuring share price and complicating equity-based incentive alignment .