SCHEDULE 13D/A: Major Agilysys Shareholder Completes Planned Share Sales and Enters Hedging Collar Arrangement

A significant shareholder group of Agilysys Inc., including MAK Capital Fund LP and Michael A. Kaufman, has filed an amended Schedule 13D to report the completion of a pre-arranged share sale plan and the establishment of a 'zero cost collar' hedging agreement.

Summary

• This filing is Amendment No. 26 to the Schedule 13D for Agilysys Inc., updating beneficial ownership information for MAK Capital Fund LP, MAK Capital One L.L.C., Michael A. Kaufman, and Kaufman 2012 Descendants Trust (collectively, the "Reporting Persons").
• The Kaufman Trust completed a Rule 10b5-1 Trading Plan on January 24, 2025, which was adopted on September 10, 2024, and involved the sale of 112,692 shares of Agilysys Inc. common stock.
• Sales under the 10b5-1 plan occurred between January 2, 2025, and January 24, 2025, at prices ranging from $93.10 to $133.71 per share.
• On December 3, 2024, MAK Capital, on behalf of MAK Fund, entered into a "zero cost collar" arrangement with Goldman Sachs & Co. LLC relating to 327,600 shares.
• As of January 21, 2025, based on 27,963,988 shares outstanding, MAK Fund and MAK Capital each beneficially own 1,192,730 shares (4.3%), Michael A. Kaufman beneficially owns 1,202,310 shares (5.1%), and Kaufman 2012 Descendants Trust beneficially owns 225,384 shares (0.8%).
• The Reporting Persons retain beneficial ownership of the 327,600 shares subject to the Collar arrangement.

Sentiment

Score: 5

Explanation: The filing is a factual update on a significant shareholder's ownership and trading activities, including a pre-planned share sale and a hedging strategy. It does not contain information about the company's operational or financial performance that would typically drive a positive or negative sentiment.

Positives

• The completion of the 10b5-1 trading plan indicates the successful execution of a pre-planned divestment strategy by the Kaufman Trust.
• The entry into a "zero cost collar" arrangement by MAK Capital suggests a sophisticated hedging strategy to manage price risk on a portion of their holdings.

Negatives

• The sale of 112,692 shares by the Kaufman Trust represents a reduction in the beneficial ownership stake of a significant shareholder group.
• The overall beneficial ownership percentage of the Reporting Persons has decreased, with MAK Fund and MAK Capital now holding 4.3% and Michael A. Kaufman holding 5.1%.

Risks

• Broker may not be able to effect a transaction under the trading plan due to legal, regulatory, or contractual restrictions applicable to the Customer, its affiliates, or the Broker.
• Volume limitations under Rule 144 could restrict the ability to sell shares.
• Failure or delay in the Broker receiving shares for deposit into the Customer Account could prevent sales.
• If the trading plan includes a Company Stock Plan Exercise, failure of the market price for such shares to exceed the exercise price on the exercise date could prevent the transaction.
• A suspension, expiration, termination, or unavailability of any applicable registration statement related to the Issuer could halt trading.
• The Issuer may impose trading restrictions, leading to a trading suspension under the plan.

Future Outlook

The 10b5-1 Trading Plan adopted by the Kaufman Trust was completed on January 24, 2025, indicating no further sales will occur under that specific plan. The "zero cost collar" arrangement entered into by MAK Capital is expected to be physically settled by delivery of shares on its expiration date, unless MAK Capital elects cash settlement.

Management Comments

• Kyle Badger, SVP, General Counsel & Secretary of Agilysys Inc., acknowledged and approved the 10b5-1 Trading Plan, confirming its consistency with the Issuer's insider trading policies.

Industry Context

This filing primarily details the trading activities and ownership changes of a specific institutional and individual shareholder group in Agilysys Inc. It does not provide information directly related to broader industry trends or competitive landscape within the hospitality software or technology sectors.

Stakeholder Impact

• Shareholders: The reduction in beneficial ownership by a significant shareholder group, while part of a pre-planned strategy, could be perceived as a signal regarding the shareholder's long-term view or could contribute to selling pressure. The collar arrangement indicates a hedging strategy rather than a full divestment.

Next Steps

• The "zero cost collar" arrangement is expected to be physically settled by delivery of shares on its expiration date, unless MAK Capital elects to pay cash.
• Broker will complete and file any required Forms 144 on behalf of the Customer, provided a power of attorney is in good order.
• Broker will transmit details of executed trades to the Issuer's Authorized Representative for Form 4 filings.

Key Dates

Keywords

Agilysys Inc, AGYS, Schedule 13D, SEC filing, beneficial ownership, 10b5-1 trading plan, zero cost collar, hedging strategy, share sale, institutional investor, MAK Capital, Michael A. Kaufman, Kaufman Trust