Alzamend Neuro Announces Series D Convertible Preferred Financing; Nasdaq Cure

What Happened
Alzamend Neuro, Inc. (ALZN) filed an 8‑K reporting a Securities Purchase Agreement with affiliate Ault Lending, LLC on July 31, 2026 to sell newly designated Series D convertible preferred stock in a financing of up to $25 million. On the execution date the company closed an initial tranche selling 7,500 Series D Preferred Shares to Ault Lending for $7.5 million. The Agreement contemplates a $2.5 million second tranche and the purchaser’s right to buy up to an additional $15 million in subsequent tranches. The company also filed the Series D Certificate of Designation with the Delaware Secretary of State on July 31, 2026.

Key Details

• Initial tranche: 7,500 Series D Preferred Shares sold on July 31, 2026 for $7.5 million; Purchaser is an affiliate (Ault Lending).
• Financing cap: up to $25 million in preferred shares (additional $2.5M second tranche plus up to $15M in later tranches).
• Preferred terms: each Preferred Share has a stated value of $1,050; conversion into common stock at the holder’s option using a Conversion Price equal to the greater of $0.2668 (floor) and 80% of the lowest closing bid in the five trading days before conversion, capped at $2.00; voting conversion floor for Nasdaq purposes is $1.4175.
• Registration and approvals: company must file a resale registration statement for conversion shares by the earlier of the 5th calendar day after filing its 10‑K for year ended April 30, 2026 or August 15, 2026. If the registration is not declared effective within the cure period, the company pays 2% per month of the stated value (up to 15% aggregate) as liquidated damages. The company will file proxy materials and hold a special meeting (within 75 days) to obtain stockholder approval for any conversion shares that would exceed Nasdaq’s 19.99% limit.
• Other investor protections: 2% origination fee per tranche (may be withheld), anti‑dilution adjustments, right of first refusal for 3 years after the purchaser no longer holds preferred, and participation rights to maintain 33.33% of future financings if desired.

Why It Matters
This financing injects immediate cash (initial $7.5M) and gives Alzamend a pathway to raise up to $25M, but the Series D shares are convertible and could dilute existing common shareholders if converted. The registration and proxy commitments are important because they affect when conversion shares can be freely resold and whether conversions above Nasdaq’s 19.99% threshold require shareholder approval. Separately, Alzamend notified Nasdaq on July 20, 2026 that it is temporarily out of compliance with the majority independent‑director requirement after the death of an independent director; Nasdaq granted a cure period (until the earlier of the next annual meeting or July 20, 2027) and the listing remains active. Investors should watch upcoming proxy and registration filings, any additional tranche closings, and board changes to assess dilution and listing risk.