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Warrant Liability
 9 Months Ended 12 Months Ended
Sep. 30, 2024
Dec. 31, 2023
Warrant Liability    
Warrant Liability

Note 10. Warrant Liability

 

Certain Warrants are accounted for as liabilities in accordance with ASC 815-40 and are presented as a Warrant liability in the accompanying condensed consolidated balance sheets. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within the condensed consolidated statements of operations. The Black Scholes Option-Pricing model used the following assumptions for the nine months ended September 30, 2024 and 2023 (See Note 8).

 

   September 30, 2024   September 30, 2023 
Expected term (years)   3.37 to 5.99    4.36 to 5.5 
Expected volatility   58.78% to 121.32%    45.31% to 59.93% 
Risk-free interest rate   3.41% to 4.56%    3.53 to 4.54%
Dividend rate   0    0 

 

The Warrant liability at September 30, 2024 and December 31, 2023 was as follows:

 

   September 30, 2024   December 31, 2023 
Trading and Overallotment Warrants  $431,250   $1,121,250 
Note Warrants   11,765    30,588 
Offering Warrants – February 2023   20,053    234,072 
Offering Warrants – September 2023   216,911    1,036,875 
Inducement Warrants – May 2024   347,123    - 
Total Warrant Liability  $1,027,102   $2,422,785 

 

The Warrants outstanding at September 30, 2024 and December 31, 2023 were as follows:

 

   September 30, 2024   December 31,2023 
         
Trading, Overallotment and Underwriter Warrants   400,568    400,568 
Note Warrants   10,695    10,695 
Offering Warrants – February 2023   8,607    102,206 
Offering Warrants – September 2023   95,078    397,727 
Inducement Warrants – May 2024   260,799    - 
Warrants issued for services arrangement   28,636    22,500 
Total Warrants Outstanding   804,383    1,194,495 

 

 

SHARPS TECHNOLOGY, INC.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023

 

Note 10. Warrant Liability (continued)

 

For the three months ended September 30, 2024, the FMV gain adjustment, which is reflected in the FMV adjustment on Warrants in the Unaudited Condensed Consolidated Statements of Operations was $416,560, which includes the modification charge of $155,703 and $349,243, gain for the warrants exercised in connection with the Inducement Agreements (See Note 8).

 

For the nine months September 30, 2024, the FMV gain adjustment, which is reflected in the FMV adjustment on Warrants in the Unaudited Condensed Consolidated Statements of Operations was $2,088,747, which includes the modification charge of $790,956 and $349,243, gain for the warrants exercised in connection with the Inducement Agreements (See Note 8).

 

For the three and nine months ended September 30, 2023, the FMV gain adjustment, which is reflected in the FMV adjustment gain (loss) on Warrants in the Unaudited Condensed Consolidated Statements of Operations was $321,981 and $415,958, respectively (see Note 8).

 

Note 10. Warrant Liability

 

The Warrants were accounted for as liabilities in accordance with ASC 815-40 and are presented as a Warrant liability in the accompanying consolidated balance sheet. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within the consolidated statement of operations, The non-trading warrants, related to the February 2023 and September 2023 offerings, are valued using the Black-Scholes pricing model. The assumptions for the year ended December 31, 2023 were as follows: (See Notes 7 and 8)

  

Year Ended
December 31,

2023

 
Expected term (years)   4.10 to 5.50  
Expected volatility   45.30% to 70.44%
Risk-free interest rate   3.53% to 4.54%
Dividend rate   0%

 

The Warrant liability at December 31, 2023 and 2022 was as follows:

 

   2023   2022 
Trading and Overallotment Warrants  $1,121,250    1,121,250 
Note Warrants   30,588    30,588 
Offering Warrants – February 2023   234,072    - 
Offering Warrants – September 2023   1,036,875    - 
Total Warrant Liability  $2,422,785    1,151,838 

 

The Warrants outstanding at December 31, 2023 and 2022 were as follows:

 

  

December 31,

2023

  

December 31,

2022

 
         
Trading and Overallotment Warrants   8,812,500    8,812,500 
Note Warrants   235,294    235,294 
Offering Warrants – February 2023   2,248,521    

-

 
Offering Warrants – September 2023   8,750,003    

-

 
Warrants issued for services arrangement   495,000    - 
Total Warrants Outstanding   20,541,318    9,047,794 

 

 

SHARPS TECHNOLOGY, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022

 

 

Note 10. Warrant Liability (continued)

 

For the years ended December 31, 2023 and 2022 the FMV loss (gain) adjustment, which is reflected in the FMV adjustment on Warrants in the Consolidated Statements of Operations was ($169,583) and ($4,784,559), respectively.