Item 5. Other Information
Item
5. Other Information
During
the quarterly period ended March 31, 2026, none of our directors or officers (as defined in Rule 16a-1(f) promulgated under the Exchange
Act) adopted or terminated any “Rule 10b5-1 trading arrangement” or any “non-Rule 10b5-1 trading
arrangement,” as each term is defined in Item 408 of Regulation S-K.
As
part of its review of our corporate governance policies, on May 8, 2026, the board of directors approved and adopted the Code Of Business
Conduct And Ethics (the “Code of Ethics”), which governs the conduct of all officers, directors, and employees of the Company
and its affiliated entities. The Code of Ethics was adopted to, among other things, generally update for current governance, ethics,
and compliance best practices; better align various Company policies, including the Code of Ethics, by eliminating certain redundant
or overlapping provisions and consolidating similar topics in the appropriate policy; and make other non-substantive administrative,
stylistic and typographical changes. The description of the Code of Ethics is a summary and is qualified in its entirety by reference
to the Code of Ethics, a copy of which is attached hereto as Exhibit 14.1. The Code of Ethics will also be posted on the Company’s
website at www.sharpstechnology.com/investors/governance-documents .
On
May 13, 2026, the Company entered into an employment agreement (the “Danner Employment Agreement”) with Paul Danner, which
replaces and supersedes in its entirety that certain prior employment agreement, dated August 25, 2025, between the Company and Mr. Danner.
Pursuant to the Employment Agreement, Mr. Danner will serve as the Company’s Principal Executive Officer and Executive Chairman
for a term commencing immediately and continuing until the third anniversary of the Danner Employment Agreement, unless earlier terminated
in accordance with its terms, and subject to an auto renewal of 1 year. For his services, Mr. Danner will be paid $600,000 per annum.
During the course of the employment, Mr. Danner will be eligible to earn an annual cash bonus beginning in 2026 based on 1% of the year-over-year
change in the Company’s market capitalization, subject to a cap of 2.5 times base salary and payable no later than March 15 of
the following year, subject to continued employment through the payment date (except as otherwise provided). Mr. Danner will also be
eligible to receive equity-based compensation awards from time to time, as determined in the sole discretion of the Board or a committee
thereof. The Danner Employment Agreement contains a perpetual confidentiality covenant as well as non-competition and employee and customer
non-solicitation covenants that apply during the Term and for a period of 18 months following Mr. Danner’s termination. In the
event the Mr. Danner’s employment is terminated by the Company without cause or by Mr. Danner for good reason, Mr. Danner will
be entitled to a lump sum severance payment equal to three (3) times Mr. Danner’s base salary, subject to Mr. Danner’s execution
and non-revocation of a release of claims; provided that, in the event such termination occurs in connection with a change in control
of the Company, Mr. Danner will also be entitled to accelerated vesting of any outstanding equity awards, whereas in the absence of a
change in control, Mr. Danner will not be entitled to any such acceleration.
On
May 13, 2026, the Company entered into an employment agreement (the “Zhang Employment Agreement”) with Yuwen Zhang, which
replaces and supersedes in its entirety that certain prior employment agreement, dated August 25, 2025, between the Company and Ms. Zhang.
Pursuant to the Employment Agreement, Ms. Zhang will serve as the Company’s Chief Investment Officer and Director for a term commencing
immediately and continuing until the third anniversary of the Zhang Employment Agreement, unless earlier terminated in accordance with
its terms, and subject to an auto renewal of 1 year. For her services, Ms. Zhang will be paid $600,000 per annum. During the course of
the employment, Ms. Zhang will be eligible to earn an annual cash bonus beginning in 2026 based on 1% of the year-over-year change in
the Company’s market capitalization, subject to a cap of 2.5 times base salary and payable no later than March 15 of the following
year, subject to continued employment through the payment date (except as otherwise provided). Ms. Zhang will also be eligible to receive
equity-based compensation awards from time to time, as determined in the sole discretion of the Board or a committee thereof. The Zhang
Employment Agreement contains a perpetual confidentiality covenant as well as non-competition and employee and customer non-solicitation
covenants that apply during the Term and for a period of 2 years following Ms. Zhang’s termination. In the event the Ms. Zhang’s
employment is terminated by the Company without cause or by Ms. Zhang for good reason, Ms. Zhang will be entitled to a lump sum severance
payment equal to three (3) times Ms. Zhang’s base salary, subject to Ms. Zhang’s execution and non-revocation of a release
of claims; provided that, in the event such termination occurs in connection with a change in control of the Company, Ms. Zhang will
also be entitled to accelerated vesting of any outstanding equity awards, whereas in the absence of a change in control, Ms. Zhang will
not be entitled to any such acceleration.
10
Stockholder
Rights Plan
On
May 13, 2026, the Board of Directors (the “ Board ”) of Sharps Technology, Inc. (the “ Company ”):
● adopted
a limited duration stockholder rights plan (the “ Rights Plan ”), the terms
of which are set forth in a Rights Agreement entered into between the Company and
VStock Transfer, LLC, as rights agent (the “ Rights Agent ”) dated May 14, 2026; and
● pursuant
to the Rights Plan, authorized and declared a dividend to stockholders of record at the close
of business on May 26, 2026 (the “ Record Date ”) of one preferred share
purchase right (each, a “ Right ”) for each outstanding share of the Company’s
common stock, par value $0.0001 (“ Common Stock ”), held by such stockholders.
The
Rights Plan is similar to other rights plans adopted by publicly held companies. Generally, under the Rights Plan, the Rights will become
exercisable only if a person or group (including a group of persons acting in concert with each other) acquires beneficial ownership
of 15% or more of the Company’s Common Stock in a transaction not approved by the Company’s Board of Directors. In such a
situation, each holder of a Right (other than the acquiring person or group, whose Rights will become void and will not be exercisable)
will have the right to purchase, upon payment of the exercise price of $10.00 per Right (both the exercise price and the number of shares
for which a Right is exercisable being subject to adjustment from time to time as set forth in the Rights Plan) and in accordance with
the terms of the Rights Plan, a number of shares of the Company’s common stock having a market value of twice such price. In addition,
if the Company is acquired in a merger or other business combination after an acquiring person acquires 15% or more of the Company’s
common stock, each holder of a Right would thereafter have the right to purchase, upon payment of the then-current exercise price and
in accordance with the terms of the Rights Plan, a number of shares of common stock of the acquiring person having a market value of
twice such price. The acquiring person or group will not be entitled to exercise Rights. Generally, the Rights Plan works by imposing
a significant penalty upon any person or group (including a group of persons acting in concert with each other) that acquires 15% or
more of the Company’s Common Stock without the approval of the Board. As a result, the overall effect of the Rights Plan and the
dividend of the Rights may be to render more difficult, or discourage, a tender or exchange offer or other acquisition of the Company’s
Common Stock that is not approved by the Board. The Rights Plan does not prevent the Board from considering any offer that it considers
to be in the best interests of the Company’s stockholders.
The
following is a summary of the terms of the Rights Plan. This summary is qualified in its entirety by reference to the complete text of
the Rights Plan, a copy of which is attached as Exhibit 4.1 to this Form 10-Q and incorporated herein by reference. Capitalized terms
used but not defined herein have the meanings ascribed to such terms in the Rights Plan.
Distribution
and Transfer of Rights
The
Board has declared a dividend of one Right for each outstanding share of Common Stock. Prior to the Distribution Date (as defined below):
● the
Rights will be evidenced by and trade with the certificates for the associated shares of
Common Stock (or, with respect to any uncertificated Common Stock registered in book-entry
form, by notation in book-entry form), and no separate right certificates will be distributed;
● new
certificates for shares of Common Stock issued after the Record Date but prior to the earliest
of the Distribution Date, the redemption or exchange of the rights (as described below) and
the Expiration Date (as defined below) or, in certain circumstances as stated in the Rights
Plan, after the Distribution Date, will contain a legend incorporating the Rights Plan by
reference (or, with respect to any uncertificated Common Stock registered in book-entry form,
this legend will be contained in a notation in book-entry form); and
● until
the earliest of the Distribution Date, the redemption of the Rights and the Expiration Date,
the surrender for transfer of any certificates for shares of Common Stock (or the surrender
for transfer of any uncertificated shares of Common Stock registered in book-entry form)
will also constitute the transfer of the Rights associated with such Common Stock.
Distribution
Date
Subject
to the terms of the Rights Plan, the Rights will separate from the Common Stock and become exercisable following the earlier of (i) the
tenth business day after the Stock Acquisition Date (as defined below) and (ii) the tenth business day (or such later date as may be
determined by action of the Board prior to such time as any person becomes an Acquiring Person (as defined below)) after the date of
the commencement by any person (other than an Exempt Person (as defined below)) of, or of the first public announcement of the intention
of any such person to commence, a tender or exchange offer the consummation of which would result in any such person having beneficial
ownership of 15% or more of the Common Stock outstanding or becoming an Acquiring Person (the earlier of such dates being herein referred
to as the “ Distribution Date ”); provided, however, that the Distribution Date shall in no event be prior to the Record
Date. After the Distribution Date, the Company will promptly cause right certificates to be mailed (or, with respect to any uncertificated
Common Stock registered in book-entry form, cause book-entry notations to be made evidencing the distribution of Rights) to the Company’s
stockholders and the Rights will become transferable apart from the Common Stock.
Stock
Acquisition Date
The
Stock Acquisition Date shall be the first date of public announcement by the Company or an Acquiring Person that an Acquiring Person
has become such, or such earlier date as a majority of the Board shall become aware of the existence of an Acquiring Person.
11
Acquiring
Person, Exempt Person, Grandfathered Person
Subject
to the terms of the Rights Plan:
● an
Acquiring Person is any person who or which shall be the beneficial owner of 15% or more
of the Common Stock then outstanding, but shall not include an Exempt Person or a Grandfathered
Person;
● Exempt
Persons include the Company and any subsidiary of the Company, any employee benefit plan
of the Company or any subsidiary of the Company and any entity or trustee holding (or acting
in a fiduciary capacity in respect of) Common Stock for or pursuant to the terms of any such
plan; and
● A
Grandfathered Person is any person who or which, together with all affiliates and associates
of such person, at the time of the first public announcement of the Rights Plan, is a beneficial
owner of 15% or more of the Common Stock then outstanding.
Flip-In
Event
Subject
to the terms of the Rights Plan, if a person becomes an Acquiring Person, then each Right will entitle the holder thereof to purchase,
upon payment of the Purchase Price, adjusted in accordance with the terms of the Rights Plan, such number of shares of Common Stock as
shall equal the result obtained by dividing the Purchase Price (as so adjusted) by 50% of the current market price per share of the Common
Stock.
However,
from and after any such Flip-In Event, any Rights that are beneficially owned by an Acquiring Person (or any affiliate, associate or
transferee of an Acquiring Person, including as a result of a transfer which the Board has determined is part of a plan, arrangement
or understanding to avoid the provisions of the Rights Plan) shall be void and any holder of such Rights shall thereafter have no rights
whatsoever with respect to such Rights.
Redemption
of Rights
The
Rights will be redeemable at the Board’s sole discretion for $0.0001 per Right (payable in cash, Common Stock or other consideration
deemed appropriate by the Board) at any time prior to a Flip-In Event and up to five Business Days after a Flip-In Event. Immediately
upon the action of the Board ordering redemption, the Rights will terminate and the only rights of the holders of the Rights will be
to receive the $0.0001 redemption price. The redemption price will be adjusted if the Company undertakes a stock dividend, a stock split
or similar transaction.
Exchange
of Rights
At
any time after a Flip-In Event, the Board may exchange the Rights, in whole or in part, for Common Stock at an exchange ratio (subject
to adjustment) of one share of Common Stock per Right. Notwithstanding the foregoing, the Board shall not be empowered to effect such
exchange at any time after an Acquiring Person shall have become the beneficial owner of 50% or more of the Common Stock then outstanding.
Expiration
Date
The
Rights shall expire at the earliest of (i) May 12, 2027, (ii) the redemption or exchange of the Rights and (iii) the closing of a merger
or other acquisition involving the Company as further described in the Rights Plan.
Amendment
of Terms of Rights Plan and Rights
The
terms of the Rights Plan and the Rights may be amended by action of the Board in any respect without the consent of the holders of the
Rights for so long as the Rights are redeemable. Thereafter, the terms of the Rights Plan and the Rights may be amended by action of
the Board without the consent of the holders of Rights, provided that no such amendment may (a) adversely affect the interests of the
holders of Rights (other than an Acquiring Person or an affiliate or associate of an Acquiring Person) or cause the Rights again to become
redeemable.
Rights
of Holders
Until
a Right is exercised, the holder thereof, as such, will have no rights as a stockholder of the Company, including, without limitation,
the right to vote or to receive dividends.
12
Certain
Anti-Takeover Effects
The
Rights are not intended to prevent a takeover of the Company and should not interfere with any merger or other business combination approved
by the Board. However, the Rights may cause substantial dilution to a person or group that acquires beneficial ownership of 15% or more
of the outstanding Common Stock.
Preferred
Share Provisions
Each
one one-thousandth of a share of Series C Preferred Stock, par value $0.0001 per share, of the Company (the “Series C Preferred
Shares”), if issued, will, among other things:
● entitle
holders thereof to 1,000 votes on all matters submitted to a vote of the stockholders of
the Company, subject to adjustment;
● in
event of any voluntary or involuntary liquidation, dissolution or winding up of the Company,
the holders of the Series C Preferred Shares shall be entitled to receive an amount per share,
subject to the provision for adjustment, equal to 1,000 times the aggregate amount to be
distributed per share to holders of Common Stock;
● other
than as provided for in the Rights Agreement, the Series C Preferred Shares shall not be
redeemable; and
● the
Series C Preferred Share shall be junior to all other series of preferred stock as to the
payment of dividends and the distribution of assets unless the terms of any series shall
provide otherwise;
The
value of one one-thousandth interest in a Preferred Share should approximate the value of one share of Common Stock.
ITEM
6. EXHIBITS
Exhibit
Number
Description
3.1*
Certificate of Designation, Preferences, and Rights of Series C Preferred Stock, dated May 14, 2026.
4.1*
Rights Plan, dated as of May 14, 2026, by and between Sharps Technology, Inc. and VStock Transfer LLC, as rights agent.
4.2*
Form of Rights Certificate (included as an exhibit to Exhibit 4.1).
10.1*
Amended and Restated Employment Agreement dated May 13, 2026, by and between Company and Paul K. Danner
10.2*
Amended and Restated Employment Agreement dated May 13, 2026, by and between Company and Alice Zhang
14.1*
Code of Ethics
31.1*
Certification of Chief Executive Officers (Principal Executive Officer) Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*
Certification of Chief Financial Officer (Principal Financial and Accounting Officer) Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**
Certification of Chief Executive Officers (Principal Executive Officer) Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**
Certification of Chief Financial Officer (Principal Financial and Accounting Officer) Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
99.2*
Summary of Rights to Purchase Preferred Shares of Sharps Technology, Inc. (included as an exhibit to Exhibit 4.1).
101.INS
Inline
XBRL Instance Document
101.SCH
Inline
XBRL Taxonomy Extension Schema Document
101.CAL
Inline
XBRL Taxonomy Extension Definition Link
101.DEF
Inline
XBRL Taxonomy Extension Definition Linkbase Document
101.LAB
Inline
XBRL Taxonomy Extension Label Linkbase Document
101.PRE
Inline
XBRL Taxonomy Extension Presentation Linkbase Document
104
Cover
Page Interactive Data File (embedded within the Inline XBRL document)
*
Filed
herewith.
**
Furnished
herewith.
+
Indicates
management contract or compensatory plan.
13
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized, on the 14th day of May 2025.
SHARPS
TECHNOLOGY, INC.
May
14, 2026
/s/
Paul K. Danner
Paul
K. Danner
Executive
Chairman and Principal Executive Officer (Principal Executive Officer)
May
14, 2026
/s/
Paul K. Danner
(Interim
Principal Financial Officer)
14