Black Titan Corp (NASDAQ: BTTC) has 6,157,019 shares registered and effective for resale under a variable-rate convertible note — roughly 3.3 times its entire free-trading public float of approximately 1.87 million shares.
That ratio is the defining structural fact for the post-reverse-merger company, which trades on the Nasdaq Capital Market with 10,774,621 shares outstanding. Only about 17% of those shares are free-trading. The rest sit with insiders: TalenTec founder Danny Vincent Dass (21.7%), other TalenTec stockholders (18.2%), and related-party financier ARC Group Limited (19.6%), according to beneficial-ownership disclosures in a December 2025 prospectus supplement.
The convertible note
The primary overhang source is an original-issue-discount senior unsecured convertible note — a debt instrument sold below face value, here at a 10% discount — funded in January 2026 under a $200 million securities purchase agreement. The initial draw was $1,515,000 in principal.
Its conversion price floats. Specifically, the holder may convert at the lower of a fixed $1.98 or 90% of the lowest volume-weighted average price over the preceding ten trading days — meaning the buyer always converts at a discount to recent market prices. A floor sits at $0.3248, below which the conversion price cannot fall. The lower the market price drifts, the more shares each dollar of principal produces, up to the 6,157,019-share registered ceiling. That self-reinforcing mechanism is sometimes called a "death-spiral" convertible.
Issuance is throttled by two guardrails: a 9.99% beneficial-ownership cap and a leak-out provision limiting daily sales to roughly 5% of trading volume.
Second variable instrument
A second floating-rate instrument appeared on May 8, 2026. ARC Group received 800 shares of Series B Preferred Stock — convertible at 80% of the five-day VWAP, a 20% discount to market — in satisfaction of an $800,000 legal settlement. No fixed conversion floor has been disclosed. Registration of the underlying common shares is due within 60 days of issuance. At recent levels, the preferred would convert into approximately 1.29 million shares, equivalent to about 69% of the current float.
Latent capacity behind the initial draw
The $200 million SPA permits the company to issue up to $198,485,000 in additional notes on the same variable-rate terms through January 2029. A preliminary F-1 registration filed in February 2026 covers 54,864,532 shares for $13.5 million of those additional draws — a takedown, meaning a partial drawdown from a larger registered shelf. That filing is not yet effective. Against a market capitalization of roughly $8.4 million, the full program's notional size is more than 23 times the company's current equity value.
What is no longer outstanding
All legacy warrants are cancelled. Armistice Capital's 4,664,038-share warrant was extinguished in October 2025 for $1 million in cash and 512,820 restricted shares. Two smaller warrants were similarly retired. Warrant overhang is zero.
Series A Preferred held by ARC (5,500 shares, convertible at a fixed $3.73) and 6,250 stock options (weighted-average exercise price $27.04) remain outstanding but are deeply out of the money.
Historical pattern
The legacy entity, Titan Pharmaceuticals, executed four reverse stock splits before the October 2025 merger: 1-for-5.5 (2015), 1-for-6 (2019), 1-for-30 (2020), and 1-for-20 (2024). Each consolidation typically follows a cycle of share-count expansion.
BTTC's dilution risk score stands at 7 out of 10 — elevated — with its convertibles-and-preferreds component rated 9 out of 10. Within 90 days, an estimated 7.45 million shares could enter the float through active conversion mechanisms, roughly four times the shares trading freely today.