What changed in Sharps Technology Inc.'s 2023 10-K compared to 2022?

Across the narrative sections we track, Sharps Technology Inc. (STSS) added 207 paragraphs, removed 184, and edited 131 between the 2022 and 2023 10-K filings. The biggest movers are Item 7. Management's Discussion & Analysis (+77/−77), Item 1. Business (+55/−52), Item 1A. Risk Factors (+52/−41).

Did Sharps Technology Inc. add new Risk Factors in the 2023 10-K?

Yes — Item 1A Risk Factors shows 52 new/edited paragraphs and 41 removed paragraphs versus the 2022 10-K.

What changed in Sharps Technology Inc.'s MD&A (Item 7) in 2023?

Item 7 Management's Discussion & Analysis shows 77 new/edited paragraphs and 77 removed paragraphs year-over-year. Read the side-by-side diff to see exactly which revenue, margin, and outlook commentary was rewritten.

Where does this STSS 10-K diff come from?

The source filings are Sharps Technology Inc.'s official 2022 and 2023 Form 10-K annual reports from SEC EDGAR. 10q10k.net parses each filing, aligns paragraphs by section (Item 1, 1A, 1C, 2, 3, 7, 7A), and highlights every added, removed and edited sentence side-by-side.

What changed in Sharps Technology Inc.'s 10-K — 2022 vs 2023

Paragraph-level year-over-year comparison of Sharps Technology Inc.'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+207 added−184 removedSource: 10-K (2024-03-29) vs 10-K (2023-03-31)

Top changes in Sharps Technology Inc.'s 2023 10-K

207 paragraphs added · 184 removed · 131 edited across 5 sections

Item 7. Management's Discussion & Analysis+77 / −77 · 49 edited
Item 1. Business+55 / −52 · 37 edited
Item 1A. Risk Factors+52 / −41 · 36 edited
Item 5. Market for Registrant's Common Equity+21 / −13 · 8 edited
Item 2. Properties+2 / −1 · 1 edited

Item 1. Business

Business — how the company describes what it does

37 edited+18 added−15 removed23 unchanged

2022 filing

2023 filing

Biggest changePlans are already being developed by Sharps for further expansion of its current manufacturing capabilities to support the anticipated future industry and customer demand for pre-fillable syringe systems capable of incorporating passive safety, low waste, and reuse prevention features as applicable. The prefillable syringe lines will utilize highly automated equipment and controlled environments established in collaboration with Nephron.

Biggest changeSharps is currently working with a leading U.S. based global healthcare company to develop and manufacture polymer prefillable syringes and components for their drug products, and plans are already being developed by Sharps for further expansion of its current manufacturing capabilities to support the anticipated future industry and customer demand for prefillable syringe systems capable of incorporating passive safety, low waste, and reuse prevention features as applicable.

Under the Safegard Agreement, we received an option to purchase either the stock of Safegard or certain assets of Safegard, including the Securegard product line of safety syringes and a manufacturing facility in Hungary, registered with the FDA and CE, for the manufacture of safety syringes, for $2.5 million in cash plus additional consideration of 28,571 shares of common stock and 35,714 stock options with an exercise price of $7.00 USD.

Under the Safegard Agreement, we received an option to purchase either the stock of Safegard or certain assets of Safegard, including the Securegard and Sologard product line of safety syringes and a manufacturing facility in Hungary, registered with the FDA and CE, for the manufacture of safety syringes, for $2.5 million in cash plus additional consideration of 28,571 shares of common stock and 35,714 stock options with an exercise price of $7.00 USD.

Failure to comply with applicable U.S. requirements may subject a company to a variety of administrative or judicial sanctions, such as FDA refusal to approve pending applications, warning letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, civil penalties and criminal prosecution. 6 Unless an exemption applies, each medical device we wish to distribute commercially in the United States will require marketing authorization from the FDA prior to distribution.

Failure to comply with applicable U.S. requirements may subject a company to a variety of administrative or judicial sanctions, such as FDA refusal to approve pending applications, warning letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, civil penalties and criminal prosecution. 7 Unless an exemption applies, each medical device we wish to distribute commercially in the United States will require marketing authorization from the FDA prior to distribution.

The sale of medical products is subject to laws and regulations pertaining to health care fraud and abuse, including state and federal anti-kickback, anti-self-referral, and false claims laws in the United States. Intellectual Property Intellectual property rights, particularly patent rights, are material to our business. We own three patents used in the Sharps Provensa, which expire between 2035 and 2040.

The sale of medical products is subject to laws and regulations pertaining to health care fraud and abuse, including state and federal anti-kickback, anti-self-referral, and false claims laws in the United States. Intellectual Property Intellectual property rights, particularly patent rights, are material to our business. We own four patents used in the Sharps Provensa, which expire between 2035 and 2040.

(“NSC”), and Nephron Sterile Compounding Center LLC (“Sterile”) (NPC, NSC, and Sterile are sometimes collectively referred to as “Nephron”), pursuant to which Sharps will provide technical advice and assistance to support manufacturing by InjectEZ, purchase certain quantities of syringes as they may order or require, and collaborate with Nephron on certain related business endeavors.

(“NSC”), and Nephron Sterile Compounding Center LLC (“Sterile”) (NPC, NSC, and Sterile are sometimes collectively referred to as “Nephron”), pursuant to which Sharps was to provide technical advice and assistance to support manufacturing by InjectEZ, purchase certain quantities of syringes as they may order or require, and collaborate with Nephron on certain related business endeavors.

Low compliance with recommended safety protocols can be seen upon examination of injury data where a majority of injuries continue to occur with non-safety devices or before full activation of a safety-protection feature. 5 2.

Without knowing what syringe is going to be used, pharmaceutical companies must overfill their vials to account for this loss. For difficult to manufacture injectable medications, this reduces the number of life saving doses which could be available to the public. When doses are extremely small, waste space can exceed the required dose.

Without knowing what syringe is going to be used, pharmaceutical companies must overfill their vials to account for this loss. For difficult to manufacture injectable medications, this reduces the number of lifesaving doses which could be available to the public. When doses are extremely small, waste space can exceed the required dose.

Sharps’ smart safety syringe products, which we refer to as Securgard™ and Sharps Provensa™, are ultra-low waste syringes that incorporate both safety and reuse prevention features, which we believe will provide us a competitive advantage over other syringes.

Sharps’ smart safety syringe products, which we refer to as Securgard™, Sologard™, and Sharps Provensa™, are ultra-low waste syringes that incorporate both passive and active safety and reuse prevention features, which we believe will provide us a competitive advantage over other syringes.

The pending patent applications are for (i) an ultra-low waste disposable syringe with self-adjusting integrating safety features, (ii) an ultra-low waste disposable safety syringe for low dose injections, and (iii) a needle and syringe system with automatic safety shield that renders a needle safe. Our pending patent applications are for utility patents.

The pending patent applications are for (i) an ultra-low waste disposable syringe with self-adjusting integrating safety features, and (ii) a needle and syringe system with automatic safety shield that renders a needle safe. Our pending patent applications are for utility patents.

Wasted medicine/dead space: all needle and syringes have space which permits the accumulation of injectable medications which cannot be accessed and are thrown away with each injection. Both Sharps Securegard and Provensa have less than 20 microliters of waste space - others have as much as 140 microliters of waste space.

Wasted medicine/dead space: all needle and syringes have dead space which permits the accumulation of injectable medications which cannot be accessed and are thrown away with each injection. Sharps disposable safety syringes have less than 20 microliters of waste space – others have as much as 140 microliters of waste space.

Human Capital We have fifty-eight full-time employees, one of which is our Chief Executive Officer, and retain the services of additional personnel on an independent contractor basis to support R&D, Finance, Marketing and Regulatory areas. We do not have any part-time employees. Of the fifty-eight employees, fifty-two work at our facilities in Hungary.

Human Capital We have fifty-seven full-time employees, two of which are our Chief Executive Officer and Chief Financial Officer, and retain the services of additional personnel, as needed, on an independent contractor basis to support R&D, Finance, Marketing and Regulatory areas. We do not have any part-time employees. Of the fifty-seven employees, fifty work at our facilities in Hungary.

Reuse prevention is recognized by the WHO as a required feature for its syringe distribution programs and the Securegard product line has been approved by the organization. PREFILLABLE SYRINGES: Sharps Technology is poised to expand its commercialized product portfolio through its collaboration with Nephron Pharmaceuticals.

We anticipate that we will compete primarily on the basis of healthcare worker and patient safety, product performance, and quality. We believe our competitive advantages will include the combination of passive safety and ultra low waste features.

We file annual, quarterly, and current reports, proxy statements and other information with the U.S. Securities Exchange Commission (the “SEC”). These filings are available to the public on the Internet at the SEC’s website at http://www.sec.gov.

Our common stock and warrants are quoted on the Nasdaq under the symbol “STSS” and “STSSW”. We file annual, quarterly, and current reports, proxy statements and other information with the U.S. Securities Exchange Commission (the “SEC”). These filings are available to the public on the Internet at the SEC’s website at http://www.sec.gov.

The intellectual property we purchased consisted of issued patent and patent files, new designs and iterations, samples, regulatory files, manufacturing files, product testing files, and market research files relating to such safety syringe products.

Sharps closed the acquisition of this intellectual property in the fourth quarter of 2017. The intellectual property we purchased consisted of issued patent and patent files, new designs and iterations, samples, regulatory files, manufacturing files, product testing files, and market research files relating to such safety syringe products.

The Securegard platform has an advanced set of features and benefits to support the needs of the market along with a high level of readiness for manufacturing and the ability to provide large commercial quantities for customers. There have been delays in the commercialization of the Sharps Provensa product line.

These platforms have advanced features and benefits to support the needs of the market along with a high level of readiness for manufacturing and the ability to provide large commercial quantities for customers. There continues to be delays in the commercialization of the Sharps Provensa product line.

Corporate Information The Company was incorporated in the State of Wyoming on December 16, 2017. On March 22, 2022, we reincorporated as a Nevada corporation. Our principal business address is 105 Maxess Road, Melville, New York 11747. We maintain our corporate website at sharpstechnology.com. The reference to our website is an inactive textual reference only.

We expect to add additional employees as we increase production capacity. 8 Corporate Information The Company was incorporated in the State of Wyoming on December 16, 2017. On March 22, 2022, we reincorporated as a Nevada corporation. Our principal business address is 105 Maxess Road, Melville, New York 11747. We maintain our corporate website at sharpstechnology.com.

Item 1. Business Background and Overview Sharps Technology, Inc. is a medical device company that has designed and patented various safety syringes and is seeking to commercialize them. We were incorporated under the laws of the State of Nevada in the first quarter of 2022.

Item 1. Business Background and Overview Sharps Technology, Inc. is a medical device company that has designed and patented various safety syringes and is seeking to commercialize them. We were initially incorporated under the laws of the State of Wyoming on December 16, 2017.

We have three additional pending patent applications in the United States and one PCT (Patent Cooperation Treaty) patent application. The patent applications, which we own, have an anticipated expiration date of June 22, 2040.

We have two additional pending patent applications in the United States and four PCT (Patent Cooperation Treaty) patent applications. The patent applications, which we own, have an anticipated expiration date of 2039/2040.

Our issued patents include a design patent (USD743,025) for the ornamental design for a safety syringe, a patent (US 10,980,950) for an ultra low-waste needle and syringe system that automatically and passively renders a needle safe during the injection process, and a patent (US 11,154,663) for a pre-filled safety needle and syringe system.

Our issued patents include a design patent (USD743,025) for the ornamental design for a safety syringe which will reach full term and expire on November 10, 2029, a patent (US 10,980,950) for an ultra low-waste needle and syringe system that automatically and passively renders a needle safe during the injection process, a patent (US 11,154,663) for a pre-filled safety needle and syringe system, and a patent (US 11,497,860) for a Ultra-Low Waste Disposable Safety Syringe for Low Dose Injections.

The information that can be accessed through our website is not part of this prospectus, and investors should not rely on any such information in deciding whether to purchase our securities. Available Information The address of our principal executive office is 105 Maxess Road, Melville, New York 11747. Our common stock is quoted on the Nasdaq under the symbol “STSS”.

The reference to our website is an inactive textual reference only. The information that can be accessed through our website is not part of this Form 10K, and investors should not rely on any such information in deciding whether to purchase our securities. Available Information The address of our principal executive office is 105 Maxess Road, Melville, New York 11747.

The Sharps-Nephron manufacturing and supply agreement is focused on the development and manufacture of high value pre-fillable syringe systems that are highly sought after by the healthcare industry and pharmaceutical markets, with projected product supply beginning the 4 th quarter of 2023.

The Asset Purchase Agreement is focused on the development and manufacture of high value prefillable syringe systems that are highly sought after by the healthcare industry and pharmaceutical markets, with projected product supply beginning early in 2025.

The Sharps Securegard is a multi-feature safety syringe that had gained market acceptance prior to Sharps’ acquisition but not been marketed or sold for several years due to a decision by the owners to wind down the business. It is both FDA and WHO approved and carries the European CE Mark.

The Sharps Securegard and Sologard lines, currently being marketed by the Company, are multi-feature safety syringes that had gained market acceptance prior to Sharps’ acquisition but not been marketed or sold for several years due to a decision by the owners to wind down the business.

We are currently building inventory though our Distribution Agreement with Nephron and anticipate that we will commence receiving orders for and continue producing commercial quantities of our products in the second quarter of 2022. We continue to be in discussions with healthcare companies and distributors for sales of our disposable syringe products.

We are currently continuing to produce commercial quantities of our products and building inventory to support the Sales and distribution Agreement with Roncadelle, in anticipation of receiving additional orders in 2024. We continue to be in discussions with healthcare companies and distributors for sales of our disposable syringe and prefillable syringe products.

In addition, both passive and active safety features are those most requested by clinicians in the field, in order to avoid infectious needlestick injuries, and reuse prevention features are a requirement by the World Health Organization. The Sharps Securegard and Provensa safety syringe product lines have been designed to address the three primary administration concerns with syringe delivery systems: 1.

Reincorporation and Reverse Split Prior to March 22, 2022, we were a Wyoming corporation and on March 22, 2022, we reincorporated as a Nevada corporation pursuant to a merger into a newly formed Nevada corporation which was approved by our board of directors and the holders of the majority of our outstanding shares of common stock.

Prior to March 22, 2022, we were a Wyoming corporation and on March 22, 2022, we reincorporated as a Nevada corporation pursuant to a merger into a newly formed Nevada corporation which was approved by our board of directors and the holders of the majority of our outstanding shares of common stock Sharps was incorporated to purchase, develop, and commercialize a body of intellectual property resulting in a family of smart safety syringe products and innovative drug delivery devices.

To obtain foreign patents for this PCT patent application, we will need to file individual patent applications at a later time. We have certain trademarks for Sharps Provensa, Sharps Provensa Ultra-Low Waste and filed applications to register other trademarks for use in our Sharps Provensa product line.

We have certain trademarks for Sharps Provensa, Sharps Provensa Ultra-Low Waste and filed applications to register other trademarks for use in our Sharps Provensa product line.

Accidental needlestick injuries: these occur when the clinician is stuck with an infected needle. According to the WHO, these accidents likely take place in excess of 2 million times per year. When a clinician receives an infectious needlestick injury, any blood borne disease which the patient had, could be transmitted to them.

According to the WHO, these accidents likely take place in excess of 2 million times per year. When a clinician receives an infectious needlestick injury, any blood borne disease which the patient had, could be transmitted to them. A 2016 World Health Organization Commission reported that over 16 billion injections are delivered worldwide each year (pre-Covid era).

A 2016 World Health Organization Commission reported that over 16 billion injections are delivered worldwide each year (pre-Covid era). A recent analysis showed that 55.1% of healthcare workers had sustained a needlestick injury, or NSI, at some point in their career.

A recent analysis showed that 55.1% of healthcare workers had sustained a needlestick injury, or NSI, at some point in their career.

Both syringe lines carry less than 20 microliters of dead space, as compared to the 70 microliters “Low Dead Space” designation and the up 140 microliters dead space found in competitors’ syringes.

Their design inherently reduces the amount of drug product that is thrown away, minimizing wasted therapies and thus improving the supply of crucial and in-demand medicines. Sharp’s disposable syringe lines carry less than 20 microliters of dead space, as compared to the 70 microliters “Low Dead Space” designation and the up to 140 microliters dead space found in competitors’ syringes.

These opportunities will include the development and sale of next generation drug delivery systems that will be produced by Sharps and can be purchased by the healthcare industry, pharmaceutical markets, as well as by Nephron. 4 On December 8, 2022, Sharps entered into a distribution agreement (the “Distribution Agreement”) with Nephron Pharmaceuticals pursuant to which the Sharps Technology appointed Nephron as its exclusive distributor for the sale and distribution of the products subject to the Distribution Agreement in and throughout the United States.

These opportunities will include the development and sale of next generation drug delivery systems that will be produced by the Company and can be purchased by the healthcare industry, pharmaceutical markets, as well as by Nephron. 4 On September 29, 2022, the Company also entered into an agreement (the “Nephron Agreement”) with InjectEZ, LLC (“InjectEZ”), Nephron Pharmaceuticals Corporation (“NPC”), Nephron SC, Inc.

We intend to market these products to the US and foreign governments. In certain situations, we will also look to sell our disposable syringe products to hospitals and clinician offices as opportunities present themselves. We expect that the Sharps Securegard product line will represent our initial disposable syringe platform to be commercially available to the market.

We intend to market these products to the U.S. and foreign governments and have already received a Purchase Order for our first Securegard sales to South America. We will also look to sell our disposable syringe products to hospitals and clinician offices as opportunities present themselves.

This type of delay is typical with the development of new technology for the healthcare market to ensure the products are safe and effective for use every time. We are endeavoring to address all obstacles to advance the commercialization of the Provensa product line as soon as possible.

The product’s specialized technology requires further design and assembly optimization as identified in our previous commercialization efforts. This on-going product refinement process is typical with the development of new technology for the healthcare market to ensure the products are safe and effective for use every time.

With respect to the last of these patent applications, we have, in addition to our United States patent application, also filed a PCT patent application. A PCT application is a single utility patent filing that provides international patent-pending status. By itself, a PCT application will not lead to foreign patents.

With respect to the last of these patent applications, we have, in addition to our United States patent application, also filed PCT patent applications. The PCT applications have entered National Phase. Some of the issued US patents have issued in other countries, some are still pending.

The Sharps Provensa is a patented safety syringe that gained FDA clearance for subcutaneous and intramuscular injections in June 2006. Both of these product lines are focused on innovatively addressing the important needs of the global healthcare market in the area of disposable syringes.

Safegard and Sologard are both FDA and WHO approved and Safegard currently carries the European CE Mark. The Sharps Provensa syringe is a patented passive safety syringe that gained FDA clearance for subcutaneous and intramuscular injections in June 2006.

Our Products DISPOSABLE SYRINGES: Smart safety disposable syringes with Ultra-low waste space technology are the preferred syringe platform for the administration of many vaccines and injectable medications. Their design inherently reduces the amount of thrown way, wasted therapies and thus improves the supply of crucial and in-demand medicines.

At this time Sharps is not able to determine a timeline for final commercialization of the Provensa product. Our Products DISPOSABLE SYRINGES: Smart safety disposable syringes with ultra-low waste technology are the preferred syringe platform for the administration of many vaccines and injectable medications.

On September 29, 2022, the Sharps Technology entered into an agreement (the “Nephron Agreement”) with InjectEZ, LLC (“InjectEZ”), Nephron Pharmaceuticals Corporation (“NPC”), Nephron SC, Inc.

On September 29, 2022, the Company entered into an agreement (the “NPC Agreement”) with Nephron Pharmaceuticals Corporation (“NPC”) and various affiliates of NPC, including InjectEZ, LLC, t. The NPC Agreement intended to support several areas of the Company’s development and growth.

Removed

Sharps was incorporated to purchase, develop, and commercialize a body of intellectual property resulting in a family of smart safety syringe products. Sharps closed the acquisition of this intellectual property in the fourth quarter of 2017.

Added

All three of these product lines are focused on innovatively addressing the most important needs of the global healthcare market in the area of disposable syringes. The Company has not yet generated any revenues from the sale of the Sharps products.

Removed

The Nephron Agreement is for a period of four (4) years, expiring on September 28, 2026 and continues thereafter for successive one (1) year periods. The Agreement includes provisions for collaborations in the areas of Manufacturing and Supply, a Pharma Services Program, and Distribution, as detailed below.

Added

The Company and NPC intended to supplement the NPC Agreement by entering into a manufacturing supply agreement, a sales and distribution agreement and a pharma services program to support growth, and a future agreement to support manufacturing expansion. As noted below, the sales and distribution agreement was terminated on March 8, 2024 and replaced.

Removed

NPC is a West Columbia, S.C.-based company that develops and produces safe, affordable generic inhalation solutions and suspension products. NPC also operates an industry-leading 503B Outsourcing Facility division, which produces pre-filled sterile syringes, luer-lock vials, IV bottles and IV bags for hospitals across America, in an effort to alleviate drug shortage needs.

Added

The original manufacturing supply agreement, noted above, will be replaced as part of the Asset Purchase Agreement, entered into on September 22, 2023 (see below) and the Pharma Services agreement continues to be in place, but no activities have occurred to date.

Removed

NPC launched a CLIA-certified diagnostics lab in 2020 where it tests people for COVID-19 and administers vaccinations.

Added

The Company is currently working to amend the terms of this NPC Agreement. based on the below September 22, 2023 Asset Purchase Agreement. The Pharma Services Program (PSP) with Nephron is intended to create new business development growth opportunities for both companies.

Removed

Through the Nephron Agreement, Sharps is entering into a manufacturing and supply agreement with InjectEZ regarding the development and manufacture of high value pre-fillable syringe systems that can be used by the healthcare industry, pharmaceutical markets and including Nephron on terms agreed upon by the parties.

Added

The Company is currently working to amend the terms of the Nephron Agreement based on the below September 22, 2023 Asset Purchase Agreements. On September 22, 2023, the Company entered into a series of agreements with Nephron and Nephron’s wholly owned subsidiary InjectEZ, LLC.

Removed

The Nephron Agreement will allow for the supply of the pre-fillable systems of different sizes and with specialized technology that will be compatible with industry standards and technology beginning in the third quarter, as recently advised by Nephron.

Added

The Company entered into an asset purchase agreement (the “Asset Purchase Agreement”) to purchase certain equipment and leasehold improvements at Nephron’s facility (the “Facility”) in West Columbia, South Carolina. The Company continues to work with Nephron towards the purchase of the Nephron facility pursuant to the Asset Purchase Agreement dated September 22, 2023.

Removed

The Agreement also allows for further expansion of manufacturing capabilities by Sharps Technology working with InjectEZ to support future industry and customer demand of pre-fillable systems as detailed in the Agreement. Additionally, Sharps is entering into a Pharma Services Program (PSP) with Nephron that will create new business development growth opportunities for both companies.

Added

This Asset Purchase Agreement, when closed, will supercede the manufacturing and supply agreement entered into in connection with the NPC Agreement on September 29, 2022, as noted in the subsequent paragraph. The closing of the Asset Purchase Agreement is contingent on obtaining the necessary financing and there can be no assurance that the closing of the asset sale will occur.

Removed

Pursuant to the Distribution Agreement, the price of shipping products will be based on the cost of delivery to Nephron’s warehouse and the Company will pay for the cost of delivery to Nephron. The Distribution Agreement has a term of two years and will continue in effect unless either party notifies the other party of its desire to terminate.

Added

On March 4, 2024 (the “Effective Date”) the Company entered into a cooperative sales and distribution agreement (the “Agreement) with Roncadelle Operations s.r.l (Roncadelle”). In conjunction with the execution of the Agreement, Roncadelle appointed the Company as its exclusive distributor of Roncadelle products in the United States, Canada, Central and South America and their territories.

Removed

At any time and for any reason, either party can terminate the Distribution Agreement after thirty (30) days’ notice and in the event of a breach of any of the Distribution Agreement’s terms and provisions, either party can terminate the Distribution Agreement by providing 90 days written notice.

Added

The Company appointed Roncadelle as its exclusive distributor of Sharps products in Europe, Middle East, APAC, South Africa and Australia and their territories. The Company and Roncadelle agreed to bear their own separate costs and expenses, including fees and other expenses, relating to external advisors and the preparation negotiation, execution and performance of this Agreement and any related documents.

Removed

The Company has the right to terminate the Distribution Agreement with 60 days written notice in the event that certain conditions are met as set forth in the Distribution.

Added

The Agreement is effective as of the Effective Date for the initial period of one (1) year (the “Initial Term”).

Removed

Although we currently have production capacity for our products and thus ability to receive and fulfill orders, we expect that the proceeds from the February 2023 Private Placement will allow us to further increase our production capacity.

Added

Upon expiration of the Initial Term, the term of the Agreement shall automatically renew for additional successive one-year terms, unless either party provides written notice of non-renewal at least ninety (90) days prior to the end of the then-current term, unless any renewal term is terminated earlier pursuant to the terms of the Agreement or applicable law.

Removed

This will help us to generate and fulfill orders for our current product line and advance our new, innovative products in connection with recent collaboration arrangements with Nephron Pharmaceuticals.

Added

(See “Recent Developments”) On March 8, 2024, the Company and Nephron Pharmaceuticals Corporation terminated their distribution agreement dated December 8, 2022. The Nephron distribution agreement has been partially replaced by the aforementioned Agreement with Roncadelle, as stated above, and plans to use other parties to distribute for the US domestic market.

Removed

The Provensa product’s combination of specialized technology has created the need for further optimization related to the final assembly steps for the product. This was identified as we moved towards commercialization for the product line and the need to generate production quantities to support customer orders.

Added

The Company entered into a new logistics services agreement on the warehousing side with Owens and Minor (“O&M”) to replace Nephron’s distribution services. The Company had no revenues from the Nephron Distribution Agreement and does not believe that the cancellation is material.

Removed

We expect to add additional employees in order to increase production capacity. 7 Impact of COVID-19 In March 2020, the World Health Organization declared coronavirus COVID-19 a global pandemic. This contagious disease outbreak has adversely affected workforces, economies, and financial markets globally leading to an economic downturn in certain industries and countries.

Added

The Company is currently negotiating its contract with O&M to provide 3PL services for both the Company and Roncadelle products, in North and South America, beginning in the third quarter of 2024. The Company and Nephron continue to maintain the Pharma Services Program (PSP) that focuses on the creation of new business development and growth opportunities for both companies.

Removed

It is not possible for the Company to predict the duration or magnitude of the adverse results of the outbreak and its effects on the Company’s business or ability to raise funds. Management continues to monitor the situation but has not experienced a significant disruption to its product development efforts.

Added

These opportunities will include the development and sale of next generation drug delivery systems that will be produced by the Company and can be purchased by the healthcare industry, pharmaceutical markets, and Pharma companies such as Nephron and others. 5 Although we currently have production capacity for our products and thus the ability to receive and fulfill orders, we used the proceeds from the February 2023 and September 2023 fund raising to allow us to further increase our production capacity, build inventory and support working capital requirements This will help us to generate and fulfill orders for our current product line and advance our new innovative products in connection with recent collaboration arrangements.

Added

The Sharps Securegard product line continues to represent our initial disposable syringe platform to be commercially available to the market. The addition of the Sologard products and SafeR products from Roncadelle are recent expansions to the Company’s product portfolio.

Added

The Sharps Securegard and Sologard, and Roncadelle SafeR safety syringe product lines incorporate both active and passive safety features and have been designed to address the three primary administration concerns with syringe delivery systems 1. Accidental needlestick injuries: these occur when the clinician is stuck with an infected needle.

Added

The prefillable syringe lines will utilize highly automated equipment and controlled environments established in collaboration with manufacturing and healthcare industry leaders.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

36 edited+16 added−5 removed58 unchanged

2022 filing

2023 filing

Biggest changeIn addition, subject to the rules of any securities exchange on which our stock is then listed, our board of directors could authorize the creation of additional series of preferred stock that has greater voting power than our common stock or that is convertible into our common stock, which could decrease the relative voting power of our common stock or result in dilution to our existing stockholders. 15 The holder of our Series A Preferred Stock will have 29.5 % of the voting power of our stockholders for the election of directors and will have certain senior rights upon sale of our Company under certain conditions.

Moreover, our business may be harmed if we experience problems with any new systems and controls that result in delays in their implementation or increased costs to correct any post-implementation issues that may arise. 12 Any failure to maintain internal control over financial reporting could severely inhibit our ability to accurately report our financial condition or results of operations.

Moreover, our business may be harmed if we experience problems with any new systems and controls that result in delays in their implementation or increased costs to correct any post-implementation issues that may arise. Any failure to maintain internal control over financial reporting could severely inhibit our ability to accurately report our financial condition or results of operations.

There can be no assurance that shares of our common stock will appreciate in value or even maintain the price at which our stockholders have purchased their shares. Our shares will be subject to potential delisting if we do not maintain the listing requirements of the Nasdaq Capital Market.

There can be no assurance that shares of our common stock will appreciate in value or even maintain the price at which our stockholders have purchased their shares. 12 Our shares will be subject to potential delisting if we do not maintain the listing requirements of the Nasdaq Capital Market.

We cannot predict the timing or impact of any future rulemaking or changes in the law. The approval process for medical device products outside the United States varies among countries and may limit our ability to develop, manufacture and sell our products internationally.

We cannot predict the timing or impact of any future rulemaking or changes in the law. 10 The approval process for medical device products outside the United States varies among countries and may limit our ability to develop, manufacture and sell our products internationally.

In addition, to increase our production capacity, we will need to build inventory, which will require that we purchase certain additional equipment, including molding machines and molds. We have not received any orders to date.

If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock, and our stock price may be more volatile. Item 1B. Unresolved Staff Comments Not applicable.

If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock, and our stock price may be more volatile. 16 Item 1B. Unresolved Staff Comments Not applicable.

Even if we succeed in building inventory, and increasing our production capacity, there is no assurance we will receive any orders for our Sharps Provensa or any future products. We may encounter significant competition and may not be able to successfully compete. There are many medical device companies offering safety syringes, and more competitors are likely to arrive.

Even if we succeed in building inventory, and increasing our production capacity, there is no assurance we will receive additional orders for our Sharps = products or any future products. We may encounter significant competition and may not be able to successfully compete. There are many medical device companies offering safety syringes, and more competitors are likely to arrive.

We have developed our Sharps Provensa product line but there can be no assurance that it will be commercially successful. Our potential profitability is dependent upon a number of factors, many of which are beyond our control. 8 If we are unable to achieve and sustain profitability, the value of our business and common stock may significantly decrease.

We have developed our Sharps product line but there can be no assurance that it will be commercially successful. Our potential profitability is dependent upon a number of factors, many of which are beyond our control. If we are unable to achieve and sustain profitability, the value of our business and common stock may significantly decrease.

In the event of a recall, we have recall insurance. 9 Our business may be affected by changes in the health care regulatory environment.

In the event of a recall, we have recall insurance. Our business may be affected by changes in the health care regulatory environment.

In order to market and sell our syringe product line and any additional medical device products we may develop in the future in the European Union and many other jurisdictions, we, and our collaborators, must obtain separate marketing approvals and comply with numerous and varying regulatory requirements.

In order to market and sell our Provensa product line and any additional medical device products we may develop in the future in the European Union and many other jurisdictions, we, and our collaborators, must obtain separate marketing approvals and comply with numerous and varying regulatory requirements.

In addition, our independent registered public accounting firm may be required to attest to the effectiveness of our internal control over financial reporting in our first annual report required to be filed with the SEC following the date we are no longer an “emerging growth company.” We have not yet commenced the costly and time-consuming process of compiling the system and processing documentation necessary to perform the evaluation needed to comply with Section 404, and we may not be able to complete our evaluation, testing and any required remediation in a timely fashion once initiated.

In addition, our independent registered public accounting firm may be required to attest to the effectiveness of our internal control over financial reporting in our first annual report required to be filed with the SEC following the date we are no longer an “emerging growth company.” We have commenced the costly and time-consuming process of compiling the system and processing documentation necessary to perform the evaluation needed to comply with Section 404, and we expect to be able to complete our evaluation, testing and any required remediation in a timely fashion.

Our executive officers, directors and principal stockholders, if they choose to act together, have the ability to control or significantly influence all matters submitted to stockholders for approval. Our executive officers, directors and principal stockholders in the aggregate, beneficially own approximately 23% of our common stock.

The market price of our common stock is likely to be highly volatile and could fluctuate widely in price in response to various factors, many of which are beyond our control, including the following: ● actual or anticipated fluctuations in our financial condition or results of operations; ● variance in our financial performance from expectations of securities analysts; ● changes in our projected operating and financial results; ● changes in laws or regulations applicable to our products; ● announcements by us or our competitors of significant business developments, acquisitions or new products; ● sales of shares of our common stock by us or our shareholders, as well as the anticipation of lock-up releases; ● our involvement in litigation; ● future sales of our common stock by us or our stockholders; ● changes in senior management or key personnel; ● the trading volume of our common stock; ● changes in the anticipated future size and growth rate of our market; ● general economic and market conditions; and ● other events or factors, including those resulting from war, incidents of terrorism, global pandemics or responses to these events. 13 Broad market and industry fluctuations, as well as general economic, political, regulatory and market conditions, may also negatively impact the market price of our common stock.

Our key personnel and other employees could still be affected by COVID-19 or any future pandemic, which could affect our ability to operate efficiently. Our business may be adversely affected by uncertainties in obtaining and enforcing intellectual property rights.

Our key personnel and other employees could still be affected by any future pandemic, which could affect our ability to operate efficiently. Our business may be adversely affected by uncertainties in obtaining and enforcing intellectual property rights.

We have three issued patents, three pending patent applications in the United States, and one PCT (Patent Cooperation Treaty) patent application. We cannot be certain that we are the first inventor of the subject matter to which we have filed a particular patent application, or if we are the first party to file such a patent application.

We have four issued patents, two pending patent applications in the United States, and four PCT (Patent Cooperation Treaty) patent application. We cannot be certain that we are the first inventor of the subject matter to which we have filed a particular patent application, or if we are the first party to file such a patent application.

We currently do not have an internal audit group, and we will need to hire additional accounting and financial staff with appropriate public company experience and technical accounting knowledge and compile the system and process documentation necessary to perform the evaluation needed to comply with Section 404.

We currently do not have an internal audit group, and we in the future we may need to hire additional accounting and financial staff with appropriate public company experience and technical accounting knowledge and compile the system and process documentation necessary to perform the evaluation needed to comply with Section 404.

We will be required, pursuant to Section 404 of the Sarbanes-Oxley Act, to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting as of the end of the fiscal year that coincides with the filing of our second annual report on Form 10-K.

We are required for 2023, pursuant to Section 404 of the Sarbanes-Oxley Act, to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting as of the end of the fiscal year that coincides with the filing of our second annual report on Form 10-K.

We do not intend to pay dividends on our common stock for the foreseeable future. We have paid no dividends on our common stock to date and we do not anticipate paying any dividends to holders of our common stock in the foreseeable future.

We have paid no dividends on our common stock to date and we do not anticipate paying any dividends to holders of our common stock in the foreseeable future.

These shares represent a large number of shares of our common stock, and if sold in the market all at once or at about the same time, could depress the market price of our common stock during the period the registration statement remains effective and could also affect our ability to raise equity capital.

We may not be able to successfully address these risks and uncertainties or successfully implement our operating strategies. If we fail to do so, such failure could have a material adverse effect on our business, financial conditions and results of operation. We may never generate significant revenues or achieve profitability.

Any import or export or other cargo restrictions related to our products, or the raw materials used to manufacture our products could restrict our ability to manufacture and ship products and harm our business, financial condition, and results of operations.

Travel and import restrictions may also disrupt our ability to manufacture or distribute our devices. Any import or export or other cargo restrictions related to our products, or the raw materials used to manufacture our products could restrict our ability to manufacture and ship products and harm our business, financial condition, and results of operations.

This could have an adverse effect on the price of our common stock. Our ability to issue additional securities for financing or other purposes, or otherwise to arrange for any financing we may need in the future, may also be materially and adversely affected if our common stock is not traded on a national securities exchange.

Our ability to issue additional securities for financing or other purposes, or otherwise to arrange for any financing we may need in the future, may also be materially and adversely affected if our common stock is not traded on a national securities exchange.

This concentration of ownership may have the effect of delaying, deferring or preventing a change in control, impeding a merger, consolidation, takeover or other business combination involving us, or discouraging a potential acquiror from making a tender offer or otherwise attempting to obtain control of our business, even if such a transaction would benefit other stockholders. 14 Additional stock offerings in the future may dilute then-existing shareholders’ percentage ownership of the Company.

These market fluctuations may also materially and adversely affect the market price of our common stock. 11 We have never paid common stock dividends and have no plans to pay dividends in the future, as a result our common stock may be less valuable because a return on an investor’s investment will only occur if our stock price appreciates.

We have never paid common stock dividends and have no plans to pay dividends in the future, as a result our common stock may be less valuable because a return on an investor’s investment will only occur if our stock price appreciates.

We may not succeed in commercializing Sharps syringe products or any future product. We may face difficulties or delays in the commercialization of Sharps Provensa or any future products, which could result in our inability to timely offer products or services that satisfy the market.

We may never generate significant revenues or achieve profitability. 9 We may not succeed in commercializing Sharps products or any future product. We may face difficulties or delays in the commercialization of Sharps products, which could result in our inability to timely offer products or services that satisfy the market.

Risks Related to Our Technology, Business, and Industry We are an early-stage company with a history of losses. We incurred net losses of $ 4,639,662 and $4,664,412 for the year ended December 31, 2022 and 2021, respectively. We have not generated any revenue to date, and we had accumulated deficit of $ 15,307,366 as of December 31, 2022.

Risks Related to Our Technology, Business, and Industry We are an early-stage company with a history of losses. We incurred net losses of $9,841,638 and $4,639,662 for the year ended December 31,2023 and 2022, respectively. We have not generated any revenue to date, and we had accumulated deficit of $25,149,004 as of December 31, 2023.

As a result of being a public company, we are obligated to develop and maintain proper and effective internal controls over financial reporting, and any failure to maintain the adequacy of these internal controls may adversely affect investor confidence in our company and, as a result, the value of our common stock.

We cannot predict or estimate the amount of additional costs we will incur as a public company or the specific timing of such costs. 13 As a result of being a public company, we are obligated to develop and maintain proper and effective internal controls over financial reporting, and any failure to maintain the adequacy of these internal controls may adversely affect investor confidence in our company and, as a result, the value of our common stock.

In addition, the securities market has, from time to time, experienced significant price and volume fluctuations that are not related to the operating performance of particular companies.

In addition, the securities market has, from time to time, experienced significant price and volume fluctuations that are not related to the operating performance of particular companies. These market fluctuations may also materially and adversely affect the market price of our common stock.

While we plan to market our Sharps smart safety syringe products for use for injecting medicines as well as Covid-19 and other vaccines, in the event of a resurgence of COVID-19 or in the case of any future pandemic, there is no guarantee that revenues from syringes needed for vaccines would offset the effects to our business in a global economic decline. 11 Health systems and other healthcare providers in our markets that provide procedures that may use our products have suffered financially and operationally and may not be able to return to pre-pandemic levels of operations.

Further, the Series A Preferred Stock, provides that in the event the Company is sold during the two year period commencing on April 19, 2023, at a price per share of more than 500% of $4.25, the Series A Preferred Stock will entitle the holder to 10% of the total purchase price.

Further, the Series A Preferred Stock, provides that in the event the Company is sold during the two year period following completion of the offering at a price per share of more than 500% of $ t he inital offering price per Common Stock unit in this offering, the Series A Preferred Stock will entitle the holder to 10% of the total purchase price.

Although the manufacturing facility we operate has continued to operate during the 2020-2021 COVID-19 pandemic due to its status as an essential business, we continue to monitor the evolving situation and cannot guarantee that the situation would be the same for any future pandemic.

Although the manufacturing facility we operate continued to operate during the 2020-2021 COVID-19 pandemic due to its status as an essential business, we cannot guarantee that the situation would be the same for any future pandemic. In the future, we may elect or be required to close temporarily which would result in a disruption in our activities and operations.

Any such disruption could impact our sales and operating results. 10 Widespread health crises also negatively affect economies which could affect demand for our products.

Our supply chain, including transportation channels, may be impacted by any such restrictions as well. Any such disruption could impact our sales and operating results. Widespread health crises also negatively affect economies which could affect demand for our products.

We have a limited operating history and we may not succeed. We have a limited operating history, and we may not succeed. We have not yet commercialized our Sharps Provensa or other products.

We have a limited operating history and we may not succeed. We have a limited operating history, and we may not succeed. We have commercialized our Securgard syringe products in mid 2023 yet no revenues have occurred and have not yet commercialized our Sharps Provensa products.

Nasdaq has rules for continued listing, including, without limitation, minimum market capitalization and other requirements. Failure to maintain our listing, or de-listing from Nasdaq, would make it more difficult for shareholders to dispose of our common stock and more difficult to obtain accurate price quotations on our common stock.

Failure to maintain our listing, or de-listing from Nasdaq, would make it more difficult for shareholders to dispose of our common stock and more difficult to obtain accurate price quotations on our common stock. This could have an adverse effect on the price of our common stock.

We have registered under separate registration statements in aggregate up to 4,497,042 shares of our common stock for sale into the public market (2,248,521 of which are issuable upon the exercise of warrants) by certain selling stockholders named therein.

Almost all of our outstanding shares are available to be sold in the open market under Rule 144 or because they have been registered under the Securities Act We have also registered shares of our common stock for sale into the public market ,which are issuable upon the exercise of warrants, by certain selling stockholders named therein.

In the past, companies who have experienced volatility in the market price of their securities have been subject to securities class action litigation. We may be the target of this type of litigation in the future, which could result in substantial expenses and divert our management’s attention.

We may be the target of this type of litigation in the future, which could result in substantial expenses and divert our management’s attention. We do not intend to pay dividends on our common stock for the foreseeable future.

Removed

In the future, we may elect or be required to close temporarily which would result in a disruption in our activities and operations. Our supply chain, including transportation channels, may be impacted by any such restrictions as well.

Added

The shares of our common stock are listed on the Nasdaq Capital Market, or Nasdaq. Nasdaq has rules for continued listing, including, without limitation, minimum market capitalization and other requirements.

Removed

Health systems and other healthcare providers in our markets that provide procedures that may use our products have suffered financially and operationally and may not be able to return to pre-pandemic levels of operations. Travel and import restrictions may also disrupt our ability to manufacture or distribute our devices.

Added

If we fail to comply with the continued listing requirements of NASDAQ, we may face possible delisting, which would result in a limited public market for our shares and make obtaining future debt or equity financing more difficult for us.

Removed

Our stock price may be volatile, and the value of our common stock may decline.

Added

Specifically, as disclosed in a Current Report filed on Form 8-K on July 16, 2023, the Company had received a notice (the “Notice”) from the staff of the Listing Qualifications Department (the “Staff”) of The Nasdaq Stock Market LLC (“Nasdaq”) notifying the Company that it was not in compliance with Nasdaq Listing Rule 5550(a)(2) (the “Rule”) because it failed to maintain a minimum bid price of $1.00 over the previous 30 consecutive business days dated May 26, 2023 to July 11, 2023.

Removed

The holder of our Series A Preferred Stock has 29.5 % of the voting power of our stockholders for the election of directors and will have certain senior rights upon sale of our Company under certain conditions.

Added

The Rules provide the Company a compliance period of 180 calendar days in which to regain compliance.

Removed

Blackman is able to exert substantial influence over the election of directors to the Board.

Added

If at any time during this 180 day period the closing bid price of the Company’s security is at least $1 for a minimum of ten (10) consecutive business days, the Staff will provide written confirmation of compliance and this matter will be closed.

Added

On January 16, 2024, the Staff determined that the Company is eligible for an additional 180 calendar day period, or until July 8, 2024, to regain compliance.

Added

The Staff’s determination is based on the Company meeting the continued listing requirement for market value of publicly held shares and all other applicable requirements for initial listing on the Capital Market with the exception of the bid price requirement, and the Company’s written notice of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary.

Added

However, if it appears to the Staff that the Company will not be able to cure the deficiency, the Staff will provide notice that its securities will be subject to delisting.

Added

The Company will continue to monitor the closing bid price of its Common Stock and will consider its available options to resolve the deficiency and regain compliance with the Minimum Bid Price Requirement within the allotted compliance period. There can be no assurance that the Company will regain compliance with the Minimum Bid Price Requirement.

Added

We will incur increased costs as a result of operating as a public company, and our management will be required to devote substantial time to compliance with our public company responsibilities and corporate governance practices.

Added

As a public company, we will incur significant legal, accounting and other expenses, which we expect to further increase after we are no longer an “emerging growth company.” The Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, the listing requirements of the Nasdaq Capital Market, and other applicable securities rules and regulations impose various requirements on public companies.

Added

Our management and other personnel will devote a substantial amount of time to compliance with these requirements. Moreover, these rules and regulations will increase our legal and financial compliance costs and will make some activities more time-consuming and costly.

Added

Broad market and industry fluctuations, as well as general economic, political, regulatory and market conditions, may also negatively impact the market price of our common stock. In the past, companies who have experienced volatility in the market price of their securities have been subject to securities class action litigation.

Added

Blackman is able to exert substantial influence over the election of directors to the Board. However, as discussed above, Mr. Blackman resigned from the Board of the Company effective July 27, 2023. Additionally, in connection with Mr. Blackman’s resignation, once his severance payments are satisfied, Mr. Blackman shall return the Series A Preferred Stock to the Company for cancellation.

Added

In the meantime, Mr. Blackman has granted the right to vote the Preferred Stock outstanding.

Added

Additional stock offerings in the future may dilute then-existing shareholders’ percentage ownership of the Company.

Item 2. Properties

Properties — owned and leased real estate

1 edited+1 added−0 removed1 unchanged

2022 filing

2023 filing

Biggest changeWe own and operate a 41,000 square foot manufacturing facility in Hungary acquired in July 2022, which we previously used for development and testing of our products and we currently use primarily for the manufacture of our products. We are prepared to move our owned molds, machinery and equipment to an alternative manufacturing location if necessary. See “Item 1.

Biggest changeWe own and operate a 41,000 square foot manufacturing facility in Hungary acquired in July 2022, which we previously used for development and testing of our products and we currently use primarily for the manufacture of our safety syringe products. We are prepared to move our owned molds, machinery and equipment to an alternative manufacturing location if necessary.

Added

See “Item 1. Business - Background and Overview.”

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

8 edited+13 added−5 removed5 unchanged

2022 filing

2023 filing

Biggest changeThere has been no material change in the expected use of the net proceeds from our IPO as described in our final prospectus filed with the SEC on April 15, 2022. Upon receipt, the net proceeds from our IPO were held in cash and cash equivalents.

Biggest changeNo offering costs were paid or are payable, directly, or indirectly, to our directors or officers, to persons owning 10% or more of any class of our equity securities, or to any of our affiliates. 18 There has been no material change in the expected use of the net proceeds from our IPO as described in our final prospectus filed with the SEC on April 15, 2022.

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock and warrants are traded on the Nasdaq Capital Markets under the symbol “STSS” and “STSSW,” respectively. Our common stock and warrants commenced trading on April 14, 2022.

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock and warrants are traded on the Nasdaq Capital Markets under the symbol “STSS” and “STSSW”, respectively. Our common stock and warrants commenced trading on April 14, 2022.

In connection with the Offering, we issued 2,248,521 units at a purchase price of $1.69 per unit. Each unit consists of one share of common stock and one non-tradable warrant exercisable for one share of common stock at a price of $1.56. The warrants have a term of five years from the issuance date.

In connection with the Offering, we issued 2,248,521 units at a purchase price of $1.69 per unit. Each unit consists of one share of common stock and one non-tradable warrant exercisable for one share of common stock at a price of $.64 as adjusted down from $1.56. The warrants have a term of five years from the issuance date.

Our current policy is to retain earnings, if any, for use in our operations and in the development of our business. As a result, we anticipate that only appreciation of the price of our common stock, if any, will provide a return to investors for at least the foreseeable future.

As a result, we anticipate that only appreciation of the price of our common stock, if any, will provide a return to investors for at least the foreseeable future.

During 2021, the Company granted 511,764 stock options at an exercise price of $7.00, including 71,248 stock options granted to a vendor relating to an equipment purchase, 114,285 stock options under an executive employment agreement and 35,714 options relating to an acquisition agreement. 16 The offers, sales, and issuances of the above securities were exempt from registration under the Securities Act by virtue of Section 4(a)(2) of the Securities Act as transactions by an issuer not involving any public offering, or in reliance on Rule 701 promulgated under Section 3(b) of the Securities Act because the transactions were pursuant to compensatory benefit plans or contracts relating to compensation as provided under Rule 701.

The offers, sales, and issuances of the above securities were exempt from registration under the Securities Act by virtue of Section 4(a)(2) of the Securities Act as transactions by an issuer not involving any public offering, or in reliance on Rule 701 promulgated under Section 3(b) of the Securities Act because the transactions were pursuant to compensatory benefit plans or contracts relating to compensation as provided under Rule 701.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers We did not purchase any of our shares of common stock or other securities during our fiscal year ended December 31, 2022. Item 6. [Reserved]

Purchases of Equity Securities by the Issuer and Affiliated Purchasers We did not purchase any of our shares of common stock or other securities during our fiscal years ended December 31, 2023 and 2022. Certain of our Officers and Directors purchased shares on the open market as reflected in their Section 16b filings (Form 4). Item 6. [Reserved]

(See Notes 16 to the Consolidated Financial Statements) Recent Sales of Unregistered Securities No unregistered equity securities were issued during the April 19, 2022 through March 27, 2023 except for the 235,000 shares issued in connection with services provided to the Company. During 2022, the Company issued 367,500 stock options at exercise prices ranging from $1.08 to $4.25.

No unregistered equity securities were issued during the period April 19,2022 through December 31, 2022 except for the 235,000 shares issued in connection with services provided to the Company. During 2023, the Company issued 1,065,000 stock options at exercise prices ranging from $.82 to $1.37.

Because many of our shares of common stock are held by brokers and other institutions on behalf of stockholders, this number is not indicative of the total number of stockholders represented by these stockholders of record. Dividend Policy We have not paid any and have no present intention of paying any dividends on our capital stock.

Holders of Record As of March 28, 2024 there were 15,670,898 common shares issued and outstanding and approximately 131 shareholders of record. Because many of our shares of common stock are held by brokers and other institutions on behalf of stockholders, this number is not indicative of the total number of stockholders represented by these stockholders of record.

Removed

The following tables sets forth the closing high and low price of the Company’ common stock and warrants, respectively, for the periods indicated as reported on the Nasdaq Capital Markets Exchange.

Added

Dividend Policy We have not paid any and have no present intention of paying any dividends on our capital stock. Our current policy is to retain earnings, if any, for use in our operations and in the development of our business.

Removed

Common Stock Closing Prices 2022 High Low Second Quarter $ 2.43 $ 0.83 Third Quarter $ 1.44 $ 0.95 Fourth Quarter $ 1.37 $ 1.02 Warrants Closing Prices 2022 High Low Second Quarter $ 0.67 $ 0.25 Third Quarter $ 0.48 $ 0.15 Fourth Quarter $ 0.42 $ 0.13 Holders of Record As of March 27, 2023, there were 11,655,936 common shares issued and outstanding and approximately 117 shareholders of record.

Added

Upon receipt, the net proceeds from our IPO were held in cash and cash equivalents. As of December 31, 2023, we have used the net proceeds from the IPO for working capital, acquisition of the Hungary facility and capital expenditures.

Removed

No offering costs were paid or are payable, directly, or indirectly, to our directors or officers, to persons owning 10% or more of any class of our equity securities, or to any of our affiliates.

Added

The net proceeds were used to fund operations and capital expenditures. (See Note 8 to the Consolidated Financial Statements) On September 29, 2023, the Company completed two simultaneous offerings and received aggregate gross proceeds of approximately $5.6 million, before expenses to the placement agent and other offering expenses of $716,000.

Removed

As of December 31, 2022, we have used approximately $10 million of the net proceeds from the IPO. Pending such uses, we plan to continue investing the unused proceeds from the IPO in fixed, non-speculative income instruments and money market funds.

Added

The net proceeds are being used to fund operations and capital expenditures. a.

Removed

During 2021, the Company completed stock subscriptions through a private placement for 487,204 shares of common stock at $7.00 per share. In addition, the Company issued 71,429 shares to a vendor for engineering and design services provided for equipment and for partial payments for equipment begin manufactured, 28,571 shares related to an acquisition and 2,857 shares for services.

Added

The first offering, the securities purchase agreement offering (the “Shelf Offering”) with institutional investors and the Company resulted in the Company receiving net proceeds from the Shelf Offering and the sale of pre-funded of approximately $2.5 million, includes the value of the pre-funded warrants recorded in APIC, net of $362,000 in fees relating to the placement agent and other offering expenses.

Added

The Shelf Offering was priced at the market under Nasdaq rules. In connection with the Shelf Offering, the Company issued 3,618,521 shares of common at a purchase price of $0.64 per unit and 800,000 pre-funded warrants at $0.639 per pre-funded warrants. The exercise price of the pre-funded warrants will be $0.001 per share. b.

Added

The second offering, the securities purchase agreement offering (“Private Placement”) with institutional investors and the Company received net proceeds from the Private Placement of approximately $2.4 million, net of $354,000 in fees relating to the placement agent and other offering expense.

Added

In connection with the Private Placement, the Company issued: (i) 2,581,479 PIPE Shares (or PIPE Pre-Funded Warrants in lieu thereof) and (ii) PIPE Warrants (non-trading) to purchase 8,750,003 shares of our common stock, at a combined purchase price of $1.074 per unit (or $1.073 per pre-funded unit).

Added

The PIPE Warrants have a term of five and one-half (5.5) years from the issuance date and are exercisable for one share of common stock at an exercise price of $0.64.

Added

The net proceeds, after reflecting par value, has been recorded in Additional Paid in Capital of $1.6 million and with respect to the PIPE Warrants recorded as a liability under ASC 815 of $985,204.

Added

On October 16, 2023, the Company filed an S-1 (Resale) Registration Statement in connection with the Private Placement and on October 26, 2023 the S-1 went effective. At December 31, 2023 the warrant liability is $1,036,875.

Added

(See Note 8 to the Consolidated Financial Statements) Recent Sales of Unregistered Securities During 2023, we completed two Private Placements and issued an aggregate of 4,830,000 shares being a) 2,248,521 relating to the February 2023 offering and b) 2,581,479 shares relating to the September 2023 offering.

Added

During 2022, the Company issued 367,500 stock options at exercise prices ranging from $1.08 to $4.25.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

49 edited+28 added−28 removed47 unchanged

2022 filing

2023 filing

Biggest changeThe aforementioned changes were offset by the decrease in the Safegard operating cost of $275,000 from $850,000 in 2021 to $575,000 in 2022, incurred prior to acquisition. The operating costs primarily related to the use of Safegard’s workforce, utility costs incurred and other services.

Biggest changeThe decrease occurred in materials and general operating costs of approximately $1M, of which, a) $575,000 related to cost incurred prior to the acquisition in July 2022 for utilization of the facility, which included Safegard’s workforce and facility operating cost and b) decreases in material and other operating of $426,000 from $545,000 in 2022 to $119,000 in 2023.

Management continues to monitor the situation but has not experienced a significant disruption to its product development efforts. 19 Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements have been prepared by the Company in accordance with generally accepted accounting principles (“GAAP”) in the United States (“U.S.”) and are expressed in U.S. dollars.

Management continues to monitor the situation but has not experienced a significant disruption to its product development efforts. Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements have been prepared by the Company in accordance with generally accepted accounting principles (“GAAP”) in the United States (“U.S.”) and are expressed in U.S. dollars.

In June 2020, in connection with the agreement to acquire Safegard, a former syringe manufacturing facility in Hungary, which was completed on July 6, 2022, we were contractually provided the exclusive use of the facility for research and development and testing in exchange for payment of the seller’s operating costs, including among others, use of Safegard’s work force, utility costs and other services.

In June 2020, in connection with the agreement to acquire Safegard, a syringe manufacturing facility in Hungary, which was completed on July 6, 2022, we were contractually provided the exclusive use of the facility for research and development and testing in exchange for payment of the seller’s operating costs, including among others, use of Safegard’s work force, utility costs and other services.

The expected life for Molds is based lesser of the number of parts that will be produced based on the expected mold capability or 5 years. Impairment of Long-Lived Assets Long-lived assets are reviewed annually for impairment or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

The expected life for Molds is based lesser of the number of parts that will be produced based on the expected mold capability or 5 years. 24 Impairment of Long-Lived Assets Long-lived assets are reviewed annually for impairment or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Actual results could differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original or remaining maturity of three months or less at the date of purchase to be cash equivalents. Cash and cash equivalents are maintained with various financial institutions.

Actual results could differ from those estimates. 23 Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original or remaining maturity of three months or less at the date of purchase to be cash equivalents. Cash and cash equivalents are maintained with various financial institutions.

The FMV adjustments, based on the trading price of outstanding warrants classified as liabilities, could impact the operating results in the reporting periods. Nature of Business Nature of Business Sharps Technology, Inc.

The FMV adjustments, based on the trading price of outstanding warrants classified as liabilities, could impact the operating results in the reporting periods. 22 Nature of Business Nature of Business Sharps Technology, Inc.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our audited financial statements and notes included in this Annual Report on Form 10-K as of and for the years ended December 31, 2022 and 2021.

At their issuance date and as of December 31, 2022, the warrants were accounted for as liabilities as these instruments did not meet all of the requirements for equity classification under ASC 815-40 based on the terms of the aforementioned warrants.

At their issuance date and as of December 31, 2023, the warrants were accounted for as liabilities as these instruments did not meet all of the requirements for equity classification under ASC 815-40 based on the terms of the aforementioned warrants.

Gain contingencies are evaluated and not recognized until the gain is realizable or realized. Off-Balance Sheet Arrangements During the periods presented, we did not have any off-balance sheet arrangements as defined under Regulation S-K Item 303(a)(4). Results of Operations Comparison of the Years Ended December 31, 2022 and, 2021.

Gain contingencies are evaluated and not recognized until the gain is realizable or realized. Off-Balance Sheet Arrangements During the periods presented, we did not have any off-balance sheet arrangements as defined under Regulation S-K Item 303(a)(4). 26 Results of Operations Comparison of the Years Ended December 31, 2023 and, 2022.

On February 3, 2023, we completed a securities purchase agreement (“Offering”) with institutional investors and received net proceeds from the Offering were approximately $3.2 million, net of $600,000 in fees relating to the placement agent and other offering expenses. The Offering was priced at the market under Nasdaq rules.

On February 3, 2023, the Company completed a securities purchase agreement (“Offering”) with institutional investors and received net proceeds from the Offering of approximately $3.2 million, net of $600,000 in fees relating to the placement agent and other offering expenses. The Offering was priced at the market under Nasdaq rules.

We expect our research and development expenses to increase for the foreseeable future as we continue to enhance our product to meet the market requirements for our Sharps Provensa product line for its various intended uses throughout the world. 17 Initial Public Offering On April 13, 2022, our registration statement on Form S-1 (File No. 333-263715), as amended, related to our IPO was declared effective by the SEC, and our common stock and warrants began trading on the Nasdaq Capital Market, or Nasdaq, on April 14, 2022.

We expect our research and development expenses to increase for the foreseeable future as we continue to enhance our products to meet the market requirements for our Sharps syringe product line for its various intended uses throughout the world. 20 Initial Public Offering On April 13, 2022, our registration statement on Form S-1 (File No. 333-263715), as amended, related to our IPO was declared effective by the SEC, and our common stock and warrants began trading on the Nasdaq Capital Market, or Nasdaq, on April 14, 2022.

Emerging Growth Company Status We are an “emerging-growth company”, as defined in the JOBS Act, and, for as long as we continue to be an emerging growth company, we may choose to take advantage of exemptions from various reporting requirements applicable to other public companies but not to emerging growth companies, including, but not limited to, not being required to have our independent registered public accounting firm audit our internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

Off-Balance Sheet Arrangements We do not have any off-balance sheet arrangements as defined in Regulation S-K Item 303(a)(4). 28 Emerging Growth Company Status We are an “emerging-growth company”, as defined in the JOBS Act, and, for as long as we continue to be an emerging growth company, we may choose to take advantage of exemptions from various reporting requirements applicable to other public companies but not to emerging growth companies, including, but not limited to, not being required to have our independent registered public accounting firm audit our internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

Once adopted, we must continue to report on that basis until we no longer qualify as an emerging growth company. 25 We will cease to be an emerging growth company upon the earliest of: (i) the end of the fiscal year following the fifth anniversary of the initial public offering; (ii) the first fiscal year after our annual gross revenue are $1.07 billion or more; (iii) the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt securities; or (iv) the end of any fiscal year in which the market value of our common stock held by non-affiliates exceeded $700 million as of the end of the second quarter of that fiscal year.

We will cease to be an emerging growth company upon the earliest of: (i) the end of the fiscal year following the fifth anniversary of the initial public offering; (ii) the first fiscal year after our annual gross revenue are $1.07 billion or more; (iii) the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt securities; or (iv) the end of any fiscal year in which the market value of our common stock held by non-affiliates exceeded $700 million as of the end of the second quarter of that fiscal year.

Level 2 Level 2 applied to assets or liabilities for which there are other than Level 1 observable inputs such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market date. 20 Level 2 instruments require more management judgment and subjectivity as compared to Level 1 instruments.

In the 2022 period, the cash provided was primarily from the IPO net proceeds of $14,202,975, prior to the effect of recording the liability attributed to the warrants from the IPO, less the Notes repayment of $2,000,000. In 2021, the cash provided was from stock subscriptions from a private placement.

Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. As at December 31, 2022, there were 10,405,916 stock options and warrants that could potentially dilute basic EPS in the future that were not included in the computation of diluted EPS because to do so would have been antidilutive for the periods presented.

Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. As of December 31, 2023, there were 22,950,155 stock options and warrants that could potentially dilute basic EPS in the future that were not included in the computation of diluted EPS because to do so would have been anti-dilutive for the periods presented.

In both years, cash was used to acquire or pay deposits for machinery and equipment of $542,662 and $2,221,830, respectively. Further, in the year ended December 31, 2022 and 2021, the Company used $2,365,576 and $75,000, respectively the acquisition of Safegard or related escrow payments.

In both years, cash was used to acquire or pay deposits for machinery and equipment of $698,277 and $542,662, respectively. In the year ended December 31, 2022, the Company used $2,365,576, for the acquisition of Safegard or related escrow payments.

The resulting warrant liabilities are re-measured at each balance sheet date until their exercise or expiration, and any change in fair value is recognized in the Company’s consolidated statement of operations and comprehensive loss (See Notes 7, 8 and 10 to the Consolidated Financial Statements). 22 Basic and Diluted Loss Per Share The Company computes net loss per share in accordance with ASC 260, Earnings per Share.

The increase in cash used was principally due to the Company incurring additional G&A expenses and R&D activities as described above during year ended December 31, 2022. Net Cash Used in Investing Activities For the year ended December 31, 2022 and 2021, the Company used cash in investing activities of $3,117,916 and $2,343,730, respectively.

The increase in cash used was principally due to the Company incurring additional G&A expenses, buildup of inventory partially offset by lower R&D activities as described above during year ended December 31, 2022. Net Cash Used in Investing Activities For the year ended December 31, 2023 and 2022, the Company used cash in investing activities of $698,277 and $3,117,916, respectively.

As an emerging growth company, we can also delay adopting new or revised accounting standards until such time as those standards apply to private companies. We intend to avail ourselves of these options. Once adopted, we must continue to report on that basis until we no longer qualify as an emerging growth company.

In connection with the Offering, the Company issued 2,248,521 units at a purchase price of $1.69 per unit. Each unit consists of one share of common stock and one non-tradable warrant exercisable for one share of common stock at a price of $.64, as adjusted down from $1.56 as per terms of the warrants.

For the year ended December 31, 2022, the Company recorded a $5,392,911 FMV gain to reflect the decrease in the Note Warrants and Warrants liabilities issued with the IPO.

For the years ended December 31, 2023, and 2022 the Company recorded a $169,583 and $5,392,911 FMV gain adjustment respectively to reflect the decrease in the Note Warrants and Warrants liabilities issued.

The warrants have a term of five years from the issuance date. Critical Accounting Policies and Significant Judgments and Estimates This management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which we have prepared in accordance with accounting principles generally accepted in the United States.

( See Notes 8 and 10 to the Consolidated Financial Statements) Critical Accounting Policies and Significant Judgments and Estimates This management’s discussion and analysis of our financial condition and results of operations is based on our financial statements, which we have prepared in accordance with accounting principles generally accepted in the United States.

(See Notes 7, 8 and 10 to the Consolidated Financial Statements) 24 Liquidity and Capital Resources On April 13, 2022, we completed its IPO which was declared effective by the SEC, and the Company’s common stock and warrants began trading on the Nasdaq Capital Market or Nasdaq on April 14, 2022 and which closed on April 19, 2022.

On April 13, 2022, we completed its IPO which was declared effective by the SEC, and the Company’s common stock and warrants began trading on the Nasdaq Capital Market or Nasdaq on April 14, 2022 and which closed on April 19, 2022.

The Company makes judgments about the recoverability of finite-lived intangible assets whenever facts and circumstances indicate that the useful life is shorter than originally estimated or that the carrying amount of assets may not be recoverable.

Identified Intangible Assets Identified Intangible Assets When applicable, the Company’s identified intangible assets are amortized on a straight-line basis over their estimated useful lives. The Company makes judgments about the recoverability of finite-lived intangible assets whenever facts and circumstances indicate that the useful life is shorter than originally estimated or that the carrying amount of assets may not be recoverable.

The Company and NPC intend to supplement the NPC Agreement by entering into a manufacturing supply agreement, a sales and distribution agreement and a pharma services program to support growth, and a future agreement to support manufacturing expansion.

In order to compete in the market, we must build inventory. Commencing in the 4 th Quarter of 2022 we have started building inventory. We require commercial quantities of inventory to secure orders. Delivery is expected shortly after receiving orders.

In order to compete in the market, we must build inventory. Commencing in the 4 th Quarter of 2022 started building inventory. We require commercial quantities of inventory to secure orders. Delivery is expected shortly after receiving orders. Research and Development Research and development expense consists of expenses incurred while performing research and development activities for our various syringe products.

We have incurred net losses in each year of $4,639,662 and $4,664,412 for the years ended December 31, 2022 and 2021, respectively.

We have incurred net losses of $9,841,638 and $4,639,662 for the years ended December 31, 2023 and 2022, respectively.

Derivative Instruments The Company accounts for common stock warrants as either equity-classified or liability-classified instruments based on an assessment of the specific terms of the warrants and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC 480”), Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”).

Stock-based compensation expense for awards granted to non-employees as consideration for services received is measured on the date of performance at the fair value of the consideration received or the fair value of the equity instruments issued, whichever can be more reliably measured. 25 Derivative Instruments The Company accounts for common stock warrants as either equity-classified or liability-classified instruments based on an assessment of the specific terms of the warrants and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC 480”), Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”).

Forward-Looking Statements The information in this discussion contains forward-looking statements and information within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, which are subject to the “safe harbor” created by those sections.

Unless the context requires otherwise, references in this Annual Report on Form 10-K to “we,” “us,” and “our” refer to Sharps Technology, Inc. 19 Forward-Looking Statements The information in this discussion contains forward-looking statements and information within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, which are subject to the “safe harbor” created by those sections.

Recent Development On September 29, 2022, the Company entered into an agreement (the “NPC Agreement”) with Nephron Pharmaceuticals Corporation (“NPC”) and various affiliates of NPC, including InjectEZ, LLC, that we believe will provide multiple future opportunities for the Company.

Recent Developments On September 29, 2022, the Company entered into an agreement (the “NPC Agreement”) with Nephron Pharmaceuticals Corporation (“NPC”) and various affiliates of NPC, including InjectEZ, LLC. The NPC Agreement intended to support several areas of the Company’s development and growth.

A reserve is established for any excess or obsolete inventories or they may be written off. At December 31, 2022 and 2021, inventory is comprised of raw materials, components and finished goods.

Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. A reserve is established for any excess or obsolete inventories, or they may be written off. At December 31, 2023 and 2022, inventory is comprised of raw materials, components and finished goods.

Net Cash Provided by Financing Activities For the year ended December 31, 2022 and 2021, the Company provided cash from financing activities of $12,235,475 and $5,180,429 respectively.

Net Cash Provided by Financing Activities For the year ended December 31, 2023 and 2022, the Company provided cash from financing activities of $8,029,628 and $12,235,475 respectively. In the 2023 period, the cash provided was from the net proceeds from the Offerings in February and September 2023.

The forward-looking statements are applicable only as of the date on which they are made, and we do not assume any obligation to update any forward-looking statements . Overview Since our inception in 2017, we have devoted substantially all of our resources to the research and development of our safety syringe products. To date, we have generated no revenue.

The forward-looking statements are applicable only as of the date on which they are made, and we do not assume any obligation to update any forward-looking statements .

The net proceeds from the IPO were approximately $14.2 million of which $5,778,750 was attributed to the warrant liability (See Notes 8 and 10 to the Consolidated Financial Statements) . At December 31, 2022 and 2021, we had a cash balance of $4,107,897 and $1,479,166, respectively.

The net proceeds from the IPO were approximately $14.2 million of which $5,778,750 was attributed to the warrant liability (See Notes 8 and 10 to the Consolidated Financial Statements). On February 3, 2023, we completed a securities purchase agreement) - (See Recent Developments-Offering).

Inventories The Company values inventory at the lower of cost (average cost) or net realizable value. Work-in-process and finished goods inventories consist of material, labor, and manufacturing overhead. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation.

At December 31, 2023 and 2022, the Company had no cash equivalents Inventories The Company values inventory at the lower of cost (average cost) or net realizable value. Work-in-process and finished goods inventories consist of material, labor, and manufacturing overhead.

This program will create new business development growth opportunities for both companies. We believe that these opportunities for the Company will include the development and sale of next generation drug delivery systems for Nephron products, the healthcare industry, and pharmaceutical markets.

Research and Development For the year ended December 31, 2022, Research and Development (“R&D”) expenses increased to $2,280,933 compared to $1,690,865 for the year ended December 31, 2021. The increase of $590,068 was due to increased R&D costs incurred at Safegard for labor $181,000 and other costs $207,000, which commenced after the acquisition on July 6, 2022.

Research and Development For the year ended December 31, 2023, Research and Development (“R&D”) expenses decreased to $1,605,547 compared to $2,280,933 for the year ended December 31, 2022. The decrease of $675,386 was due to decreased R&D costs incurred at the Safegard facility which transitioned principally from R&D activities to manufacturing.

The increase of $3,651,059 was primarily attributable to increases in payroll and related of: i) payroll and consulting fees of $805,000 from $918,000 in 2021 to $1,723,000 in 2022, primarily due to increased amounts of payroll and increased staffing, including fifty-two staff members and $187,000 relating to the Safegard acquisition from date of acquisition and additional other staff and pay of $618,000 from $918,000 in 2021 to $1,355,000 in 2022 and ii) decrease in stock compensation expense, due to timing of option awards and vesting, of approximately $175,000 from $1,091,000 in 2021 to $916,000 in 2022.

The increase of $2,063,243 was primarily attributable to increases in payroll and related of: i) payroll and consulting fees of $1,530,000 from $1,630,000 in 2022 to $3,160,000 in 2023, primarily due to increased amounts of payroll, increased staffing and higher usage of various consulting services and ii) increase in stock compensation expense, due to timing of option awards and vesting, of approximately $34,000 from $916,000 in 2022 to $950,000 in 2023.

Research and Development Research and development expense consists of expenses incurred while performing research and development activities for our various syringe products. We recognize research and development expenses as they are incurred.

We recognize research and development expenses as they are incurred.

Year Ended December 31, 2022 December 31, 2021 Change Change % Research and development $ 2,280,933 1,690,865 $ 590,068 35 % General and administrative 6,457,860 2,806,801 3,651,059 130 % Interest expense (income) 1,320,416 166,746 1,153,670 692 % FMV gain adjustment for derivatives (5,392,911 ) - (5,392,911 ) - Foreign currency Loss 496 - 496 - Other (27,132 ) - (27,132 ) - Net loss $ 4,639,662 $ 4,664,412 $ (24,750 ) 1 % 23 Revenue The Company has not generated any revenue to date.

Year Ended December 31, 2023 December 31, 2022 Change Change % Research and development $ 1,605,547 2,280,933 $ (675,386 ) (30 )% General and administrative 8,521,103 6,457,860 2,063,243 32 % Interest expense (income) (138,118 ) 1,320,416 (1,458,534 ) 110 % FMV gain adjustment for derivatives (169,583 ) (5,392,911 ) 5,223,328 (97 )% Foreign currency Loss 44,463 496 43,967 88 % Other 8,226 (27,132 ) 35,358 (130 )% Deferred Tax (Benefit) (30,000 ) - (30,000 ) 100 % Net loss $ 9,841,638 $ 4,639,662 $ 5,201,976 (112 )% Revenue The Company has not generated any revenue to date.

ASC 260 requires presentation of both basic and diluted earnings per share (EPS) on the face of the consolidated statement of operations and comprehensive loss. Basic EPS is computed by dividing net income (loss) available to common stockholders (numerator) by the weighted average number of shares outstanding (denominator) during the year.

Basic EPS is computed by dividing net income (loss) available to common stockholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Basic EPS includes the 3,381,479 of pre-funded warrants (see Note 8).

(See Notes 16 to the Consolidated Financial Statements) Cash Flows Net Cash Used in Operating Activities The Company used cash of $6,433,159 and $3,147,736 in operating activities for the year ended December 31, 2022 and 2021, respectively.

On September 29, 2023, the Company completed two simultaneous offerings (See Recent Developments – Shelf Offering and Private Placement Offering) Cash Flows Net Cash Used in Operating Activities The Company used cash of $8,507,300 and $6,433,159 in operating activities for the year ended December 31, 2023 and 2022, respectively.

The Offering was priced at the market under Nasdaq rules. In connection with the Offering, the Company issued 2,248,521 units at a purchase price of $1.69 per unit. Each unit consists of one share of common stock and one non-tradable warrant exercisable for one share of common stock at a price of $1.56.

Interest expense (income) Interest expense, net of interest income, was $ 1,320,416 for the year ended December 31, 2022 , compared to interest expense of $ 166,746 for the year ended December 31, 2021 .

These were partially offset by lower public company costs and investor relations $818,000, travel $90,000 and patent fees $31,000. Interest expense (income) Interest income, net of interest expense, was $138,118 for the year ended December 31, 2023, compared to interest expense of $1,320,416 for the year ended December 31, 2022.

Through this plan of accelerated expansion, we believe that the Company will be able to deliver increased capacity, driving growth and ultimately, profitability for the high value products’ segment of our business. 18 On February 3, 2023, the Company completed a securities purchase agreement (“Offering”) with institutional investors and received net proceeds from the Offering were approximately $3.2 million, net of $600,000 in fees relating to the placement agent and other offering expenses.

The increase in our working capital was primarily related to net proceeds from our initial public offering of approximately $14.2 million prior to the effect of recording the liability attributed to the warrants from the IPO, less use of cash in operations, investing in fixed assets purchased, repayment of the Note Payable of $2.0 million and $2.4 million paid relating to the Safegard acquisition.

The decrease in our working capital, after net proceeds from offerings of $8,029,628, was primarily related to the use of cash of $9,205,577 in operations and investing in fixed assets purchased.

We had increases in stock compensation and consulting fees of $4,000 from $321,000 in 2021 to $325,000 in 2022, decreases in engineering of $4,000 from $169,000 in 2021 to $165,000 2022 and decreases in other R&D costs of $119,000 from $331,000 in 2021 to $212,000 in 2022.

Further, we had decreases in labor related costs of $224,000 specifically related to decreases in stock compensation of $83,000 from $97,000 in 2022 to $14,000 in 2023, decreases in engineering and other labor costs of $141,000 from $492,000 in 2022 to $351,000 in 2023 and other decreases of $10,000.

The facility, since June 2020 and following the acquisition, has been used for further development, production of current prototype samples and related testing. General and Administrative For the year ended December 31, 2022, General and Administrative (“G&A”) expenses were $6,457,860 as compared to $2,806,801 for the year ended December 31, 2021.

The overall decrease was partially offset by $560,000 charge in 2023 for an impairment of certain molds. General and Administrative For the year ended December 31, 2023, General and Administrative (“G&A”) expenses were $8,521,103 as compared to $6,457,860 for the year ended December 31, 2022.

Removed

Unless the context requires otherwise, references in this Annual Report on Form 10-K to “we,” “us,” and “our” refer to Sharps Technology, Inc.

Added

Overview Since our inception in 2017 and through the fourth quarter of 2022, we have devoted substantially all of our resources to the research and development of our safety syringe products Commencing in the fourth quarter of 2022 we started building inventory of syringe products. To date, we have generated no revenue.

Removed

The NPC Agreement is for a period of four (4) years, expiring on September 28, 2026, and continues thereafter for successive one (1) year periods. The NPC Agreement is intended to support several areas of the Company’s development and growth.

Added

Removed

The manufacturing and supply agreement will be focused on the development and manufacture of high value pre-fillable syringe systems that can be utilized by Nephron which are highly sought after by the healthcare industry and pharmaceutical markets, with projected product supply beginning in mid-2023. The syringe lines will utilize highly automated equipment and controlled environments established by Nephron.

Added

Removed

These premium offerings will be made from what we believe are the highest quality raw materials, on the most innovative technology.

Added

On September 29, 2022, the Company also entered into an agreement (the “Nephron Agreement”) with InjectEZ, LLC (“InjectEZ”), Nephron Pharmaceuticals Corporation (“NPC”), Nephron SC, Inc.

Removed

These products will be compliant with the USP standards required in the United States, as well as the EP and JP international standards, as applicable The products that the Company and Nephron intend to develop and commercialize are designed to provide solutions to support Nephron’s current fill/finish strategies, as well as their pipeline of new drug applications, and sets forward a strategy to support branded pharma and advanced therapies including ophthalmic and biologic applications.

Added

(“NSC”), and Nephron Sterile Compounding Center LLC (“Sterile”) (NPC, NSC, and Sterile are sometimes collectively referred to as “Nephron”), pursuant to which the Company was to provide technical advice and assistance to support manufacturing by InjectEZ, purchase certain quantities of syringes as they may order or require, and collaborate with Nephron on certain related business endeavors.

Removed

Our seasoned understanding of pharma fill/finish processes and equipment and strong connections with preferred component suppliers and large pharmaceutical companies sets the groundwork for an effective market strategy in partnership with Nephron. On December 8, 2022, the Company completed the sales and distribution agreement (the “Distribution Agreement”) portion of the overall agreement with Nephron Pharmaceuticals Corporation and Nephron SC, Inc.

Added

Removed

(collectively, “Nephron”), pursuant to which the Company appointed Nephron as its exclusive distributor for the sale and distribution of the products subject to the Distribution Agreement in and throughout the United States.

Added

Removed

Added

This Asset Purchase Agreement, when closed, will supercede the manufacturing and supply agreement entered into in connection with the NPC Agreement on September 29, 2022. The closing of the Asset Purchase Agreement is contingent on obtaining the necessary financing and there can be no assurance that the closing of the asset sale will occur.

Removed

Added

On March 4, 2024 (the “Effective Date”) the Company entered into a cooperative sales and distribution agreement (the “Agreement) with Roncadelle Operations s.r.l (“ Roncadelle”)). In conjunction with the execution of the Agreement, Roncadelle appointed the Company as its exclusive distributor of Roncadelle products in the United States, Canada, Central and South America and their territories.

Removed

The Company has the right to terminate the Distribution Agreement with 60 days written notice in the event that certain conditions are met as set forth in the Distribution Agreement. The Company’s collaboration will include the creation of a Pharma Services Program (PSP) designed to support Healthcare customers that need innovative solutions and products to support their business.

Added

The Company appointed Roncadelle as its exclusive distributor of Sharps products in Europe, Middle East, APAC, South Africa and Australia and their territories. The Company and Roncadelle agreed to bear their own separate costs and expenses, including fees and other expenses, relating to external advisors and the preparation, negotiation, execution and performance of this Agreement and any related documents.

Removed

The development of the program will help create new fill/finish project opportunities that will utilize innovative packaging solutions developed by the Company. These new customer projects will help create a future pipeline of growth for both companies working together.

Added

The Agreement is effective as of the Effective Date for the initial period of one (1) year (the “Initial Term”).

Removed

Initial, and currently confidential, projects have been identified and will be further developed through the collaboration efforts of Nephron and the Company. The opportunity to create new innovative technologies to support Nephron and the healthcare industry would be transformative for the Company and its future.

Added

Upon expiration of the Initial Term, the term of the Agreement shall automatically renew for additional successive one year terms, unless either party provides written notice of non-renewal at least ninety (90) days prior to the end of the then-current term, unless any renewal term is terminated earlier pursuant to the terms of the Agreement or applicable law.

Removed

The Company will be working with Nephron on plans for future expansion, innovation, collaboration and building for long-term success. To further support the planned growth for the Pharma Services Program, we will be working to expand our U.S. operations in South Carolina with the help of NPC.

Added

(See “Recent Developments”) On March 8, 2024, the Company and Nephron Pharmaceuticals Corporation terminated their distribution agreement dated December 8, 2022. The Nephron distribution agreement has been partially replaced by the aforementioned Agreement with Roncadelle on the foreign sales side and plans to use other parties to distribute for the US domestic market.

Removed

This expansion may include the construction of an additional manufacturing facility, located on the Nephron campus, that would be focused on the manufacture of specialized drug delivery technologies to support Nephron and the healthcare and pharmaceutical industries.

Added

Removed

Goodwill and Purchased Identified Intangible Assets Goodwill When applicable, goodwill will be recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the net tangible and identified intangible assets acquired under a business combination. Goodwill also includes acquired assembled workforce, which does not qualify as an identifiable intangible asset.

Added

The Company is currently negotiating its contract with O&M to provide 3PL services for both the Company and Roncadelle products, in North and South America, beginning in the third quarter of 2024. The Company and Nephron continue to maintain the Pharma Services Program that focuses on the creation of new business development and growth opportunities for both companies.

Removed

The Company reviews impairment of goodwill annually in the third quarter, or more frequently if events or circumstances indicate that the goodwill might be impaired. The Company first assesses qualitative factors to determine whether it is necessary to perform the quantitative goodwill impairment test.

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Other STSS 10-K year-over-year comparisons

STSS 10-K 2023 vs 2024