Form 4: Alzamend Neuro Director Milton C. Ault III Reports Acquisition of Series B Convertible Preferred Stock and Warrants

Director Milton C. Ault III reports acquiring Series B Convertible Preferred Stock and warrants of Alzamend Neuro, Inc.

Summary

• Milton C. Ault III, a director and 10% owner of Alzamend Neuro, Inc., filed a Form 4 on March 28, 2024, reporting transactions from March 26, 2024.
• Ault acquired 780 shares of Series B Convertible Preferred Stock at $1 each and warrants to purchase 780,000 shares of common stock at $1.20 each.
• Following the reported transactions, Ault indirectly owns 2,000 shares of Series B Convertible Preferred Stock and 2,000,000 warrants through Ault Lending, LLC.
• The Series B Convertible Preferred Stock is convertible into common stock at a conversion price of $1.00 per share.
• The issuer's ability to issue common stock upon conversion of the Series B Convertible Preferred Stock and/or exercise of the warrants is restricted to 1,322,951 shares (19.99% of outstanding shares as of January 31, 2024) without stockholder approval.

Sentiment

Score: 6

Explanation: The sentiment is neutral. While a director's investment is generally positive, the restrictions on share issuance introduce some uncertainty.

Positives

• A director's investment in preferred stock and warrants may signal confidence in the company's future prospects.

Negatives

• The restriction on issuing common stock upon conversion/exercise without stockholder approval could limit the flexibility of the company to raise capital or execute strategic transactions.

Risks

• The need for stockholder approval to issue more than 19.99% of outstanding shares upon conversion/exercise introduces uncertainty and potential delays.
• The value of the warrants is dependent on the future performance of the company's common stock.

Future Outlook

The company's future ability to issue common stock upon conversion of the Series B Convertible Preferred Stock and/or exercise of the warrants is contingent upon obtaining stockholder approval if it exceeds the 19.99% threshold.

Industry Context

Form 4 filings are standard disclosures required by the SEC to provide transparency regarding the transactions of company insiders. This filing indicates a director's investment in the company's securities.

Stakeholder Impact

• Shareholders may be impacted by the potential dilution of their ownership if the Series B Convertible Preferred Stock is converted and/or the warrants are exercised.
• The restriction on issuing shares without stockholder approval could affect the company's ability to raise capital and pursue strategic initiatives.

Next Steps

• The company may need to seek stockholder approval to issue additional shares of common stock upon conversion of the Series B Convertible Preferred Stock and/or exercise of the warrants if the 19.99% threshold is exceeded.

Key Dates

Keywords

Alzamend Neuro, Milton Ault, Series B Convertible Preferred Stock, Warrants, Form 4, Beneficial Ownership, Director, ALZN