CID Holdco, Inc. (NASDAQ: DAIC) carries roughly 16.2 million shares in pending overhang against a public float — the portion of shares freely available for trading — of just 1.34 million. That ratio, approximately 12-to-1, earns the company a dilution risk score of 9 out of 10.
The most immediate piece of that overhang is also the most striking. On September 15, distressed-debt buyer LHT I, LLC converted $1.09 million of defaulted secured debt into 2,815,506 common shares at a fixed price of $0.386 per share — meaning the conversion was locked in at roughly 81% below the prevailing market level. That single block equals 209% of the current float. The shares are unregistered, so resale depends on Rule 144 — a federal safe harbor that allows restricted shares to be sold publicly after a holding period — but that window could open within weeks if CID files a delinquent quarterly report.
Variable-rate notes add open-ended risk
Behind the LHT block sit two layers of variable-rate convertible notes — instruments whose conversion price floats downward with the stock.
H Capital Ventures holds a $550,000 note that converts at the lower of $1.50 or 90% of the trailing 10-day VWAP — the volume-weighted average price — with a $0.50 floor. On default, that floor drops to $0.01. Given the company's recent default history, the trigger is not hypothetical. At the floor, the note could produce 1.1 million shares. At $0.01 it could produce far more.
White Lion Capital holds two senior secured notes totaling $575,000 in principal. They convert at 80% of the lowest 15-day VWAP, with their own $0.01 default reset. Their current status is undisclosed. White Lion also holds a commitment warrant — a right to purchase shares — exercisable at 99% of the prior closing price with full-ratchet anti-dilution, meaning any lower-priced issuance automatically resets the warrant's exercise price downward. The $0.386 LHT conversion could trigger that ratchet.
Envoy acquisition brings the largest single block
The biggest overhang by share count is structural, not debt-related. CID's pending acquisition of Envoy Technologies, an EV car-sharing company, would issue approximately 10.6 million Series C Preferred shares that convert one-for-one into common stock. Add 233,543 closing common shares and up to 483,333 additional funding shares, and the Envoy deal alone represents roughly 8 times the current float.
Conversion is blocked above 19.99% of outstanding shares until a stockholder vote, targeted for January 2027. After approval, conversion is automatic. The two recipients — BladeRanger Ltd. and Blink Charging Co. — face six- and twelve-month lock-ups, respectively, but once those expire, the shares enter the tradeable supply.
The structural math
CID has 1,962,604 shares outstanding after a 1-for-25 reverse split executed in late May. That count has already grown 62% in four months from unexplained issuances — likely White Lion draws and note conversions — with no quarterly filing to confirm the source. The company's authorized share ceiling is 300 million, leaving ample room.
Pro forma for all pending instruments, fully diluted shares reach approximately 18.2 million. Within 90 days, an estimated 3.8 million shares could reach the float. Within twelve months, that figure rises to roughly 13.4 million — nearly ten times the current tradeable supply.
The company is also facing a Nasdaq delisting determination, which, if upheld, would move trading to the OTC market and could accelerate default triggers embedded in multiple financing agreements.