Alkermes buyout: Avadel (AVDL) CFO equity cashed out for $21 plus CVRs
Rhea-AI Filing Summary
Avadel Pharmaceuticals CFO Thomas S. McHugh reported the disposition of his ordinary shares and stock options in connection with Alkermes plc’s acquisition of the company. At the effective time of the scheme of arrangement, each outstanding ordinary share was converted into $21.00 in cash plus a non-transferable contingent value right for a potential additional $1.50 per share, contingent on specified milestones.
The filing shows 100,400 ordinary shares disposed of at $21.00 per share, leaving no ordinary shares held directly afterward. Multiple stock options covering various numbers of ordinary shares, with exercise prices ranging from $3.45 to $13.57, were canceled and exchanged for cash based on the spread to the $21.00 cash consideration, plus one contingent value right per underlying share.
Positive
- None.
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Insights
CFO’s equity is cashed out and converted to cash plus CVRs in Alkermes’ acquisition of Avadel.
This Form 4 details how Avadel’s acquisition by Alkermes plc affects the CFO’s equity. Each ordinary share converts into $21.00 cash plus a contingent value right for a potential extra $1.50 per share, tied to milestone achievement.
All of Thomas S. McHugh’s directly held ordinary shares, including previously restricted stock awards, were disposed of, and multiple stock option grants were canceled. Each option is exchanged for cash equal to its in-the-money value versus the $21.00 price, plus one contingent value right per underlying share.
This effectively ends his direct equity stake in Avadel and replaces it with cash and milestone-based contingent rights. For investors, the key takeaway is that the transaction terms treat management’s equity on the same economic basis as other shareholders, with upside now linked to future CVR milestone outcomes.
Insider Trade Summary
| Type | Security | Shares | Price | Value |
|---|---|---|---|---|
| Disposition | Stock Option (Right to Buy) | 250,000 | $0.00 | -- |
| Disposition | Stock Option (Right to Buy) | 200,000 | $0.00 | -- |
| Disposition | Stock Option (Right to Buy) | 150,000 | $0.00 | -- |
| Disposition | Stock Option (Right to Buy) | 175,000 | $0.00 | -- |
| Disposition | Stock Option (Right to Buy) | 157,500 | $0.00 | -- |
| Disposition | Stock Option (Right to Buy) | 72,000 | $0.00 | -- |
| Disposition | Ordinary Shares | 100,400 | $21.00 | $2.11M |
Footnotes (1)
- Reflects the disposition of ordinary shares of Avadel Pharmaceuticals plc ("Issuer"), nominal value $0.01 per share ("Ordinary Shares"), in connection with the consummation of the transactions contemplated by the Transaction Agreement, dated as of October 22, 2025, as amended by Amendment No. 1 to the Transaction Agreement dated November 18, 2025, (together the "Transaction Agreement") by and between Issuer and Alkermes plc ("Parent"), including the consummation of a scheme of arrangement under Chapter 1 of Part 9 of the Companies Act 2014 of Ireland (the "Scheme") pursuant to which Parent acquired Issuer. Pursuant to the Transaction Agreement, on February 12, 2026, the effective time of the Scheme (the "Effective Time"), each outstanding Ordinary Share was converted into $21.00 in cash (the "Cash Consideration") and a non-transferable contingent value right entitling the holders to a potential additional cash payment of $1.50 per share, contingent upon achievement of certain milestones (each a "CVR"). Includes Ordinary Shares previously subject to vesting restrictions or forfeiture back to Issuer (each, a "Restricted Stock Award"). Pursuant to the Transaction Agreement, at the Effective time, each Restricted Stock Award that was outstanding immediately prior to the Effective Time vested in full and was treated in the manner described in footnote 1. Reflects the disposition of Issuer's options to purchase Ordinary Shares (each, an "Option") as contemplated by the Transaction Agreement. Pursuant to the Transaction Agreement, at the Effective Time, each outstanding Option (whether or not vested) was canceled and exchanged for the right to receive (i) an amount in cash (less applicable tax and any other mandatory withholdings), equal to the product of (a) the total number of Ordinary Shares subject to such Option immediately prior to the Effective Time, multiplied by (b) the excess of the Cash Consideration over the applicable exercise price per Ordinary Share under such Option and (ii) one CVR for each Ordinary Share subject to such Option immediately prior to the Effective Time (without regard to vesting).
