SCHEDULE 13D/A: Major Shareholder Scot Cohen Boosts Stake in Wrap Technologies to 24.1% Through New Grants and Acquisitions

Scot Cohen, a significant shareholder, has increased his beneficial ownership in Wrap Technologies, Inc. to 24.1% through a combination of new equity grants, dividend shares, and a recent securities purchase agreement involving V4 Global LLC.

Summary

• Scot Cohen, the reporting person, beneficially owns an aggregate of 13,526,827 shares of Wrap Technologies, Inc. Common Stock, representing 24.1% of the class.
• This ownership includes 9,776,289 shares with sole voting and dispositive power, and 13,526,827 shares with shared voting and dispositive power.
• The calculation of the 24.1% ownership is based on 50,494,701 shares outstanding as of March 25, 2025, plus shares acquirable by the Reporting Person and V4 Global LLC.
• On February 5, 2025, Scot Cohen received a grant of 250,000 fully vested restricted stock units and stock options to purchase 500,000 shares, vesting annually over four years.
• Between November 25, 2024, and March 4, 2025, Scot Cohen received an additional 169,104 shares as dividends on Series A Convertible Preferred Stock.
• During the same period, V4 Global LLC received 236,744 shares as dividends on Series A Convertible Preferred Stock.
• On February 24, 2025, V4 Global LLC acquired 1,100,000 shares of Common Stock through a Securities Purchase Agreement.
• In connection with the February 2025 Securities Purchase Agreement, the Issuer entered into a Registration Rights Agreement on February 24, 2025, agreeing to file a registration statement for the resale of shares within 60 days and use best efforts for effectiveness within 90 days (or 120 days for a full SEC review).

Sentiment

Score: 7

Explanation: The sentiment is moderately positive. The increase in a significant shareholder's stake, coupled with new equity grants to a key individual, suggests confidence and alignment of interests. While potential future dilution exists, the immediate implication is a strengthened insider position and recent capital inflow.

Positives

• Increased beneficial ownership by a key individual (Scot Cohen) and associated entity (V4 Global LLC) signals confidence in the company's future.
• The grant of 250,000 fully vested restricted stock units and 500,000 stock options to Scot Cohen aligns his interests with long-term shareholder value.
• The Registration Rights Agreement provides a clear path for liquidity for the investors, which can be attractive for future capital raises.

Negatives

• The issuance of new shares through options, RSUs, and the Securities Purchase Agreement could lead to dilution for existing shareholders.
• The Registration Rights Agreement, while providing liquidity, also means that a significant block of shares could be sold into the market in the future, potentially creating downward pressure on the stock price.

Risks

• Potential for future dilution from the exercise of stock options, conversion of preferred stock, and warrants.
• Risk of downward pressure on share price if a large block of registered shares is sold by the reporting person or V4 Global LLC after the registration statement becomes effective.
• Reliance on key personnel, as the vesting of 500,000 stock options for Scot Cohen is contingent on his continued employment or service to the Issuer.

Future Outlook

The company is obligated to file a registration statement within 60 days of February 24, 2025, and use best efforts to have it declared effective within 90 days (or 120 days if a full SEC review occurs), which will allow for the resale of shares acquired by investors, including V4 Global LLC. Scot Cohen's stock options will vest in four substantially equal annual installments, contingent on his continued service.

Industry Context

This filing is specific to changes in beneficial ownership for Wrap Technologies, Inc. and does not provide broader industry trends or competitive analysis. It reflects an individual and associated entity's increased stake in a company, which can be interpreted as a vote of confidence in the company's future within its specific market segment (e.g., public safety technology).

Corporate Governance

Related Party Transactions

• V4 Global LLC, an entity associated with the reporting person Scot Cohen, acquired 1,100,000 shares of Common Stock through a Securities Purchase Agreement.
• V4 Global LLC also received 236,744 shares as dividends on Series A Convertible Preferred Stock, similar to the Reporting Person's dividend shares.

Stakeholder Impact

• Shareholders: Potential for dilution from new share issuances and future sales of registered shares, but also a signal of confidence from a major investor.
• Employees: Scot Cohen, as a key individual, received new equity grants, aligning his incentives with company performance.

Next Steps

• The Issuer is required to prepare and file a registration statement with the SEC registering the resale of the shares issued pursuant to the private placement no later than 60 days following February 24, 2025.
• The Issuer must use best efforts to have the registration statement declared effective as promptly as practical thereafter, and in any event no later than 90 days following February 24, 2025 (or 120 days in case of a full SEC review).

Key Dates

Keywords

Wrap Technologies, Scot Cohen, V4 Global, Schedule 13D, beneficial ownership, common stock, stock options, restricted stock units, convertible preferred stock, warrants, registration rights agreement, SEC filing, equity compensation, shareholder stake