Wrap Technologies secures $5.8 million in private funding

TEMPE, Ariz. - Wrap Technologies, Inc. (NASDAQ:WRAP), a developer of advanced public safety solutions with a current market capitalization of $93.33 million, has secured approximately $5.8 million through a private placement, the company disclosed today. According to InvestingPro data, the company maintains a moderate debt level with a healthy current ratio of 1.15. The investment includes the sale of over 3.2 million shares of common stock and accompanying warrants at $1.80 per share, with the proceeds intended for working capital and general corporate purposes.

The private placement attracted investment primarily from partnerships affiliated with company insiders and several existing investors. The warrants issued will be immediately exercisable at the same price of $1.80 per share and will expire five years from the date of issuance. The company’s stock has shown strong momentum, with InvestingPro reporting a notable 32.7% price return over the past six months, despite current profitability challenges. This financing is set to close around February 28, 2025, pending customary closing conditions.

Wrap Technologies is known for its BolaWrap® remote restraint device, which is designed to safely restrain individuals from a distance with a Kevlar® tether. The device is part of the company’s Managed Safety and Response (MSR) Connected Ecosystem, which also includes Wrap Reality™, a virtual reality training system for public safety personnel, and Intrensic, a body-worn camera and evidence management solution.

The company has stated that the new funds will support its go-to-market strategy for BolaWrap and the MSR ecosystem, both domestically and internationally. Additionally, the investment will contribute to increasing training and customer support to optimize BolaWrap programs and bolster a federal plan for a presence in Washington, DC.

This funding round was conducted under exemptions from the registration requirements of the Securities Act of 1933, as stipulated by Section 4(a)(2) of the Act and Rule 506 of Regulation D. Wrap Technologies has also committed to registering the securities for resale, as per a registration rights agreement.

The press release from Wrap Technologies emphasizes the company’s commitment to developing solutions that address the challenges facing public safety organizations. With a gross profit margin of 41.69% and annual revenue of $4.23 million, the company shows potential despite current challenges. According to InvestingPro analysis, the stock appears to be trading near its Fair Value, with additional insights and 7 more ProTips available to subscribers. However, it is important to note that this article is based on a press release statement and does not serve as an endorsement of the company’s claims or future prospects.

In other recent news, Wrap Technologies has completed its acquisition of W1 Global, a consulting firm with expertise in international criminal investigation and regulatory matters. This strategic move is expected to enhance Wrap’s Managed Safety and Response Connected Ecosystem and extend its international reach, potentially leading to immediate revenue growth. Additionally, the company has amended its Equity Compensation Plan, increasing the number of shares available for grants by 7.5 million, following approval from its stockholders. This expansion aligns with Wrap’s efforts to incentivize employees, officers, and directors.

In a recent SEC filing, Wrap Technologies disclosed the granting of significant stock awards to top executives, including CEO Scot Cohen and COO Jared Novick, as part of its 2017 Equity Compensation Plan. These awards are intended to align executive compensation with shareholder interests. Furthermore, Wrap Technologies has amended the terms of its Series A Preferred Stock, increasing the dividend accrual rate to 20% per annum, compounded monthly, in certain conditions. This change, resulting from an agreement with investors, affects the rights of security holders and reflects a strategic adjustment to the company’s financial structure.

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