Sharps Technology, Inc. Announces Closing of Upsized $20.0 Million Underwritten Public Offering

Rhea-AI Summary

Sharps Technology (NASDAQ: STSS) has closed its upsized underwritten public offering, raising $20.0 million in gross proceeds. The offering comprised 14,285,714 Common Units priced at $1.40 per unit (or $1.3999 for Pre-Funded Units). Each unit consists of one share of Common Stock (or Pre-Funded Warrant), one Series A Warrant, and one Series B Warrant.

Both Series A and B Warrants have an exercise price of $1.75. Series A Warrants expire in 60 months while Series B Warrants expire in 30 months after stockholder approval. The underwriter, Aegis Capital Corp., exercised its over-allotment option for 2,142,857 Series A Warrants and 2,142,857 Series B Warrants.

Positive

• Successfully raised $20.0 million in gross proceeds
• Upsized offering indicates strong investor interest

Negative

• Significant potential dilution from warrant exercises
• Additional dilution from over-allotment warrants
• Offering expenses will reduce net proceeds

Insights

Financial Analyst

This $20 million capital raise represents a significant financial event for Sharps Technology, with several noteworthy implications for investors:

The offering's structure merits careful analysis. At $1.40 per Common Unit, pricing below the warrant exercise price of $1.75, suggests a strategic balance between immediate capital needs and future upside potential. The dual-warrant structure (Series A extending 60 months and Series B for 30 months) creates a complex but potentially beneficial scenario for both the company and investors.

The capital injection is particularly significant given Sharps' $900,953 market capitalization. This substantial raise, representing approximately 22x the company's pre-offering market cap, provides important working capital but comes with notable dilution considerations:

• Immediate dilution through 14,285,714 new shares/units
• Potential future dilution from warrant exercises totaling up to 28,571,428 additional shares
• Over-allotment option exercise adding 4,285,714 warrants

For a medical device company focused on innovative syringe products, this capital could be transformative. The size of the raise relative to market cap suggests ambitious growth plans, potentially including:

• Accelerated product development and commercialization
• Manufacturing scale-up opportunities
• Possible strategic acquisitions or partnerships

The warrant exercise price at a 25% premium to the offering price indicates management's confidence in achieving higher valuations, though the alternative cashless exercise option for Series B warrants provides flexibility. The 60-month exercise window for Series A warrants gives the company a lengthy runway for value creation, while the 30-month Series B term creates a nearer-term catalyst.

NEW YORK, Jan. 29, 2025 (GLOBE NEWSWIRE) -- Sharps Technology, Inc. (NASDAQ: STSS) (the “Company”), an innovative medical device and pharmaceutical packaging company offering patented, best-in-class syringe products, today announced the closing of its previously announced firm commitment underwritten public offering. Gross proceeds to the Company were approximately $20.0 million, before deducting underwriting fees and other offering expenses payable by the Company. The offering closed on January 29, 2025.

The offering consisted of 14,285,714 Common Units (or Pre-Funded Units), each consisting of (i) one (1) share of Common Stock or one (1) Pre-Funded Warrant, (ii) one (1) Series A Registered Common Warrant to purchase one (1) share of Common Stock per warrant at an exercise price of $1.75 (“Series A Warrant”) and (iii) one (1) Series B Registered Common Warrant to purchase one (1) share of Common Stock per warrant at an exercise price of $1.75 (“Series B Warrant” and together with the Series A Warrant, the “Warrants”). The public offering price per Common Unit was $1.40 (or $1.3999 for each Pre-Funded Unit, which is equal to the public offering price per Common Unit sold in the offering minus an exercise price of $0.0001 per Pre-Funded Warrant). The Pre-Funded Warrants are immediately exercisable and may be exercised at any time until exercised in full. For each Pre-Funded Unit sold in the offering, the number of Common Units in the offering will be decreased on a one-for-one basis. The initial exercise price of each Series A Warrant is $1.75 per share of Common Stock. The Series A Warrants are exercisable immediately and expire 60 months after stockholder approval. The number of securities issuable under the Series A Warrants is subject to adjustment as described in more detail in the report on Form 8-K to be filed in connection with the offering. The initial exercise price of each Series B Warrant is $1.75 per share of Common Stock or pursuant to an alternative cashless exercise option. The Series B Warrants are exercisable immediately and expire 30 months after stockholder approval. The number of securities issuable under the Series B Warrants is subject to adjustment as described in more detail in the report on Form 8-K to be filed in connection with the offering.

Solely to cover over-allotments, if any, the Company granted Aegis Capital Corp. (“Aegis”) a 45-day option to purchase additional shares of Common Stock and/or Warrants of (i) up to 15.0% of the number of shares of Common Stock sold in the offering, (ii) up to 15.0% of the number of Series A Warrants sold in the offering and (iii) up to 15.0% of the number of Series B Warrants sold in the offering. The purchase price per additional share of Common Stock is equal to the public offering price of one Common Unit (less $0.00001 allocated to each full Warrant), less the underwriting discount. The purchase price per additional Warrant is $0.00001. On January 29, 2025, Aegis exercised its over-allotment option with respect to 2,142,857 Series A Warrants and 2,142,857 Series B Warrants.

Aegis Capital Corp. acted as the sole book-running manager for the offering. Sichenzia Ross Ference Carmel LLP acted as counsel to the Company. Kaufman & Canoles, P.C. acted as counsel to Aegis Capital Corp.

The offering was made pursuant to an effective registration statement on Form S-1 (No. 333-284237) previously filed with the U.S. Securities and Exchange Commission (SEC) and declared effective by the SEC on January 27, 2025. A final prospectus supplement and accompanying prospectus describing the terms of the proposed offering will be filed with the SEC and will be available on the SEC’s website located at www.sec.gov. Electronic copies of the final prospectus supplement and the accompanying prospectus may be obtained, when available, by contacting Aegis Capital Corp., Attention: Syndicate Department, 1345 Avenue of the Americas, 27th floor, New York, NY 10105, by email at syndicate@aegiscap.com, or by telephone at +1 (212) 813-1010.

This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About Sharps Technology, Inc.

Sharps Technology is an innovative medical device and pharmaceutical packaging company offering patented, best-in-class smart-safety syringe products to the healthcare industry. The Company’s product lines focus on providing ultra-low waste capabilities, that incorporate syringe technologies that use both passive and active safety features. Sharps also offers products that are designed with specialized copolymer technology to support the prefillable syringe market segment. The Company has a manufacturing facility in Hungary and is partnering with Nephron Pharmaceuticals to expand its manufacturing capacity in the U.S. For more information about Sharps Technology, please visit the website at: http://sharpstechnology.com.

Forward-Looking Statements

The foregoing material may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, each as amended. Forward-looking statements include all statements that do not relate solely to historical or current facts, including without limitation statements regarding the Company’s product development and business prospects, and can be identified by the use of words such as “may,” “will,” “expect,” “project,” “estimate,” “anticipate,” “plan,” “believe,” “potential,” “should,” “continue” or the negative versions of those words or other comparable words. Forward-looking statements are not guarantees of future actions or performance. These forward-looking statements are based on information currently available to the Company and its current plans or expectations and are subject to a number of risks and uncertainties that could significantly affect current plans. Should one or more of these risks or uncertainties materialize, or the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results, performance, or achievements. Except as required by applicable law, including the security laws of the United States, the Company does not intend to update any of the forward-looking statements to conform these statements to actual results.

Investor Relations:
Dave Gentry
RedChip Companies, Inc.
1-800-RED-CHIP (733-2447) Or 407-644-4256
STSS@redchip.com

FAQ

How much did Sharps Technology (STSS) raise in its January 2025 public offering?

Sharps Technology raised $20.0 million in gross proceeds through its underwritten public offering that closed on January 29, 2025.

What is the exercise price of STSS warrants issued in the January 2025 offering?

Both Series A and Series B Warrants have an exercise price of $1.75 per share of Common Stock.

How many Common Units were offered in STSS's January 2025 public offering?

The offering consisted of 14,285,714 Common Units (or Pre-Funded Units) priced at $1.40 per Common Unit.

What is the expiration period for STSS's Series A and B Warrants from the January 2025 offering?

Series A Warrants expire 60 months after stockholder approval, while Series B Warrants expire 30 months after stockholder approval.

How many additional warrants were issued through the over-allotment option?

Aegis exercised its over-allotment option for 2,142,857 Series A Warrants and 2,142,857 Series B Warrants.