Adial Pharmaceuticals amends PIPE and note exchange agreements ahead of annual meeting

Adial Pharmaceuticals, Inc. filed an 8-K describing two amendments executed on September 16, 2026. The company entered into an Amendment No. 2 to its Securities Purchase Agreement with certain PIPE Investors holding a Majority of Interest, which removed a Penalty Provision and added a lock-up restriction on shares issuable upon exercise of Initial Closing PIPE Pre-Funded Warrants.¹ The same day, the company entered into an Amendment No. 1 to the Note Exchange Agreement with certain Former Azora Noteholders who had received pre-funded warrants to purchase an aggregate of 1,504,098 shares of Common Stock, similarly removing the Penalty Provision and adding a corresponding lock-up.¹ The company said it plans to reach a similar agreement with remaining noteholders before long.

According to the filing, a penalty provision in the original agreements had caused the entire value of the milestone warrants to be classified as a liability in the company's financial statements, which in turn pushed stockholders' equity below Nasdaq's minimum requirements for continued listing and for approval of an initial listing application tied to an anticipated change of control.¹ The company said the amendments were meant to change the accounting treatment of the warrants so they are no longer booked as a liability, and to help the company meet Nasdaq's listing standards.¹

The accompanying pro forma balance sheet shows the reclassification effect: $19.7 million and $3.0 million of the milestone warrant rights liability moved to additional paid-in capital following the purchase agreement and note exchange amendments, respectively.¹ Separately, outstanding Series A Preferred Stock is set to convert automatically into common stock three business days after an expected stockholder vote at the 2026 Annual Meeting, scheduled for September 17, 2026.¹ The filing notes the company had acquired Azora Therapeutics, Inc. under a June 11, 2026 merger agreement, issuing Azora stockholders 437,474 shares of common stock and 12,930.617 shares of Series A Preferred Stock.¹