SciSparc Secures $20M Equity Line with YA II PN, Ltd.

TL;DR

**SciSparc just locked in a $20M equity line, giving them cash but risking dilution.**

AI Summary

SciSparc Ltd. (NASDAQ: SPRC) entered into a Standby Equity Purchase Agreement (SEPA) with YA II PN, Ltd. on January 21, 2024. This agreement allows SciSparc to sell up to $20,000,000 of its ordinary shares over a three-year period, at its sole discretion, with shares priced at 97% of the lowest daily VWAP over three trading days. This matters to investors because it provides SciSparc with a flexible funding mechanism, potentially diluting existing shareholders if the company issues new shares, but also offering capital for operations or growth without immediate debt obligations.

Why It Matters

This agreement gives SciSparc a flexible way to raise up to $20 million in capital over three years, which could fund research, development, or general operations, but also risks diluting current shareholders if many new shares are issued.

Risk Assessment

Risk Level: medium — The SEPA provides capital flexibility but carries a medium risk of shareholder dilution as new shares can be issued at a discount to market price.

Analyst Insight

An investor should monitor SciSparc's future filings for 'Advance Notices' to YA II PN, Ltd. to gauge the rate of share issuance and potential dilution, while also considering how the raised capital is being deployed for growth or operational stability.

Key Numbers

• $20,000,000 — Commitment Amount (Maximum capital SciSparc can raise through the SEPA)
• 97% — Share Price Discount (Shares will be sold at 97% of the market price)
• 3 years — Agreement Duration (Period during which SciSparc can sell shares under the SEPA)
• 4.99% — Ownership Cap (Maximum percentage of shares YA II PN, Ltd. can own)
• $5.0 million — Pre-Paid Advance Limit (Maximum amount for each pre-paid advance)

Key Players & Entities

• SciSparc Ltd. (company) — the registrant entering the SEPA
• YA II PN, Ltd. (company) — the investor providing the equity line
• $20,000,000 (dollar_amount) — the maximum commitment amount under the SEPA
• January 21, 2024 (date) — the execution date of the Standby Equity Purchase Agreement
• 4.99% (dollar_amount) — the maximum ownership percentage YA II PN, Ltd. can hold
• $5.0 million (dollar_amount) — the maximum amount for each Pre-Paid Advance

Forward-Looking Statements

• SciSparc will utilize a significant portion of the $20,000,000 equity line within the next 12-18 months to fund ongoing research and development. (SciSparc Ltd.) — medium confidence, target: 2025-07-25
• The issuance of new shares under the SEPA will lead to moderate dilution for existing shareholders over the three-year period. (SciSparc Ltd. shareholders) — high confidence, target: 2027-01-21

FAQ

Key Financial Figures

• $20,000,000 — the Company will be able to sell up to $20,000,000, or the Commitment Amount, of its ordin
• $5.0 m — e Commitment Amount, in an amount up to $5.0 million, each a Pre-Paid Advance. Each Pr
• $200,000 — nt fee, or the Commitment Fee, equal to $200,000, or 1% of the Commitment Amount, payabl
• $10,000 — f YA a structuring fee in the amount of $10,000. As of the date of this Report of Forei
• $20 Million — e titled “SciSparc Ltd. Announces $20 Million Standby Equity Purchase Agreement,&rdqu

Filing Documents

• ea192120-6k_scisparc.htm (6-K) — 19KB
• ea192120ex4-1_scisparc.htm (EX-4.1) — 70KB
• ea192120ex10-1_scisparc.htm (EX-10.1) — 255KB
• ea192120ex99-1_scisparc.htm (EX-99.1) — 7KB
• ex99-1_001.jpg (GRAPHIC) — 2KB
• 0001213900-24-006291.txt ( ) — 355KB

SIGNATURES

SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. SciSparc Ltd. Date: January 25, 2024 By: /s/ Oz Adler Name: Oz Adler Title: Chief Executive Officer and Chief Financial Officer 3

View Full Filing

View this 6-K filing on SEC EDGAR