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.

Insights

Equity compensation and M&A specialist

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.

SEC Form 4

FORM 4

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940

OMB APPROVAL

OMB Number:			3235-0287
Estimated average burden
hours per response:			0.5

X

Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

Check this box to indicate that a transaction was made pursuant to a contract, instruction or written plan for the purchase or sale of equity securities of the issuer that is intended to satisfy the affirmative defense conditions of Rule 10b5-1(c). See Instruction 10.

1. Name and Address of Reporting Person^*

MCHUGH THOMAS S

(Last) (First) (Middle)

C/O AVADEL PHARMACEUTICALS PLC

10 EARLSFORT TERRACE

(Street)

DUBLIN 2 L2 D02 T380

(City) (State) (Zip)

2. Issuer Name and Ticker or Trading Symbol
AVADEL PHARMACEUTICALS PLC [ AVDL ]

5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

	Director		10% Owner
X	Officer (give title below)		Other (specify below)
	Chief Financial Officer

3. Date of Earliest Transaction (Month/Day/Year)
02/12/2026

4. If Amendment, Date of Original Filed (Month/Day/Year)

6. Individual or Joint/Group Filing (Check Applicable Line)

X	Form filed by One Reporting Person
	Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
			Code	V	Amount	(A) or (D)	Price
Ordinary Shares	02/12/2026		D(1)(2)		100,400(3)	D	$21(1)(2)	0	D

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
				Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares
Stock Option (Right to Buy)	$3.45	02/12/2026		D(4)			250,000	(4)	12/02/2029	Ordinary Shares	250,000	(4)	0	D
Stock Option (Right to Buy)	$6.79	02/12/2026		D(4)			200,000	(4)	12/08/2030	Ordinary Shares	200,000	(4)	0	D
Stock Option (Right to Buy)	$8.2	02/12/2026		D(4)			150,000	(4)	12/07/2031	Ordinary Shares	150,000	(4)	0	D
Stock Option (Right to Buy)	$4.69	02/12/2026		D(4)			175,000	(4)	08/04/2032	Ordinary Shares	175,000	(4)	0	D
Stock Option (Right to Buy)	$13.57	02/12/2026		D(4)			157,500	(4)	02/20/2034	Ordinary Shares	157,500	(4)	0	D
Stock Option (Right to Buy)	$7.87	02/12/2026		D(4)			72,000	(4)	03/06/2030	Ordinary Shares	72,000	(4)	0	D

Explanation of Responses:

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.

2. 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").

3. 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.

4. 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).

	/s/ Robert E. Puopolo, as Attorney-in-Fact	02/12/2026
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
Note: File three copies of this Form, one of which must be manually signed. If space is insufficient, see Instruction 6 for procedure.
Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB Number.

FAQ

What did Avadel (AVDL) CFO Thomas S. McHugh report in this Form 4?

He reported disposing of all directly held Avadel ordinary shares and stock options in connection with Alkermes’ acquisition. His equity converted into $21.00 per share in cash plus contingent value rights tied to future milestone-based payments.

What consideration did Avadel (AVDL) shareholders receive in the Alkermes transaction?

Each outstanding Avadel ordinary share was converted into $21.00 in cash and a non-transferable contingent value right. The CVR entitles holders to a potential additional $1.50 per share if specified milestones are achieved after closing.

How many Avadel (AVDL) ordinary shares did the CFO dispose of?

The filing shows Thomas S. McHugh disposed of 100,400 ordinary shares at $21.00 per share. This figure includes shares that had been subject to vesting or forfeiture, which fully vested at the transaction’s effective time and were treated like other shares.

What happened to the Avadel (AVDL) stock options held by the CFO?

All outstanding stock options to buy Avadel ordinary shares were canceled at closing. Each option was exchanged for cash equal to the in-the-money value versus the $21.00 cash consideration, plus one contingent value right for every underlying share covered by the option.

Does the Avadel (AVDL) CFO still directly own any company shares or options after the deal?

No. After the reported transactions, the Form 4 shows zero ordinary shares and zero derivative securities directly owned. His former equity position has been replaced by cash and contingent value rights issued under the Alkermes acquisition terms.

How are restricted stock awards for Avadel (AVDL) treated in this acquisition?

Restricted stock awards that were outstanding immediately before the effective time vested fully. They were then treated as ordinary shares, receiving the same $21.00 cash per share and contingent value right structure described for other Avadel ordinary shareholders.