SciSparc Ltd. (NASDAQ: SPRC) carries a tradeable public float of approximately 563,000 shares, but the effective supply of shares either outstanding or registered and ready to enter the market totals roughly 3.12 million — 5.5 times the float. Nearly all of that pending supply is registered for resale to a single entity and its affiliate.

The company scores a 9 out of 10 on ShareStructure's dilution-risk scale.

The Convertible Note at the Center

The dominant overhang source is a $2.0 million convertible note issued February 12, 2026, to L.I.A. Pure Capital Ltd., controlled by Kfir Silberman. The note converts at the lower of a fixed price or 88% of the lowest daily volume-weighted average price (VWAP) — the benchmark average trading price — over the preceding 20 trading days, with a floor of $1.107 per share after the company's latest reverse split. At that floor, the note alone can produce up to 2,040,964 shares. That is 3.6 times the entire current float from a single $2 million instrument.

A 4.99% beneficial-ownership blocker — a cap that prevents the holder from owning more than 4.99% of outstanding shares at any one time — ensures conversions arrive as a continuous drip rather than a single block. Each conversion-and-sell cycle pushes down the trailing VWAP, which in turn lowers the next conversion price. This self-reinforcing mechanic is what the market calls a "death spiral" convertible.

Layered Instruments Compound the Overhang

Stacked on top of the note:

• Coverage warrant: 405,728 shares at $4.932, currently in the money, expiring February 2029 — equal to 72% of the float by itself.
• Pre-funded warrant: 113,043 shares at $0.009, held by Xylo Technologies (wholly owned by the same counterparty). A pre-funded warrant — one purchased upfront for nearly the full share price, leaving only a nominal exercise cost — is economically already stock.
• Undrawn note facility: $8.0 million of additional principal drawable at up to $2.5 million per quarter starting April 1, 2026, with draw pace accelerating whenever daily trading volume exceeds 150% of shares outstanding. At the floor price, this facility could generate roughly 7.2 million additional shares — 12.8 times the current float — and each tranche triggers a fresh 100%-coverage warrant.
• Active SEPA: A standby equity purchase agreement — an equity line that lets the company sell shares on demand to a standing buyer — with 109,020 shares still reserved.

One Counterparty, Every Side of the Table

L.I.A. Pure Capital is simultaneously the convertible lender, the warrant holder, the seller of the acquired Xylo imaging assets (paid in the pre-funded warrant), a paid investment advisor to SciSparc since 2020, and the sole registered selling shareholder. The February 2026 resale registration — an F-3 filing that allows registered shares to be sold into the open market — covers 2,559,736 post-split shares, roughly 4.5 times shares outstanding.

Three Reverse Splits in 30 Months

SPRC has executed reverse splits of 1-for-26 (September 2023), 1-for-21 (July 2025), and 1-for-9 (March 2026) — a cumulative 1-for-4,914. Shareholders have separately authorized the board to effect yet another reverse split of up to 1-for-250 at its discretion through approximately December 2026. That standing authorization is the reset lever that allows the floating-price issuance cycle to continue. On a split-adjusted basis, shares outstanding grew 538% during calendar 2025 alone.

The company holds 2 billion authorized shares against just 573,243 outstanding — an authorized-to-outstanding ratio exceeding 3,400 to 1.