SRM Entertainment Inc

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Unregistered Sales of Equity Securities

None.

Stock Exchange Agreement and Initial Public Offering

Effective August 14, 2023, pursuant to a Stock Exchange Agreement (the “Exchange Agreement’) with Jupiter Wellness, Inc. as amended and restated on May 26, 2023 under the terms of which Jupiter Wellness acquired 6,500,000 shares of the Company’s common stock in exchange for all of the issued and outstanding ordinary shares of SRM Entertainment, Limited. The closing of the transactions contemplated by the Amended and Restated Exchange Agreement occurred immediately prior to the effective time of the Company’s Form S-1 Registration Statement for the IPO and the distribution of 2,000,000 shares of the Company’s common stock to Jupiter Wellness’s stockholders and certain warrant holders were paid on the effective date of the Company’s Form S-1 Registration Statement for the IPO but prior to the closing of the IPO.

On August 14, 2023, the Company consummated its IPO, pursuant to which it sold 1,250,000 shares of its common stock at a price of $5.00 per share, resulting in gross proceeds to the Company of approximately $6.25 million. Net proceeds to the Company, after deducting underwriting discounts and commissions and offering expenses paid by the Company, were $5,326,064. EF Hutton acted as lead book-running manager for the offering and Dominari Securities LLC acted as co-manager for the offering. The underwriters did not exercise their option to purchase up to an additional 187,500 shares of common stock.

All shares sold in our IPO were registered pursuant to the Registration Statement, declared effective by the SEC on August 14, 2023. The offering terminated after the sale of all securities registered pursuant to the Registration Statement.

Use of Proceeds

The Company has applied the net proceeds from the IPO for the development of licensed goods, expansion of SRM products, increased deposits, accounts receivable and inventory, marketing, advertising, and trade shows, general administrative expenses, repayment of a $1,544,814 promissory note payable to Jupiter Wellness, and general corporate purposes.