SCHEDULE: Agassi Entities Increase Stake in Agassi Sports Entertainment

Agassi entities, including Investments AKA, LLC and Andre Agassi Trust, have increased their beneficial ownership in Agassi Sports Entertainment Corp. to 23.3% following warrant exercises and a new convertible note.

Summary

• This filing is an amendment to a Schedule 13D, reporting an increase in beneficial ownership of Agassi Sports Entertainment Corp. by several entities and individuals associated with Andre Agassi and Stefanie Graf.
• The Reporting Persons, including Investments AKA, LLC, Agassi Ventures, LLC, The Andre Agassi Trust, ASI Group, LLC, Stefanie Graf, and Andre K. Agassi, collectively beneficially own 3,291,398 shares of Common Stock, representing 23.3% of the outstanding shares.
• This increase is due to the exercise of warrants and the issuance of a convertible promissory note.
• Specifically, Investments AKA, LLC exercised warrants, resulting in a net issuance of 651,231 shares.
• Stefanie Graf was granted warrants to purchase 1,000,000 shares under a Brand Partner Agreement.
• Investments AKA, LLC also entered into a $1,000,000 Convertible Promissory Note with the Company, which is set to convert in the next equity financing of at least $3,000,000 or mature on July 27, 2027.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this filing as moderately positive, reflecting increased beneficial ownership and strategic partnerships, but with a significant convertible note that introduces future uncertainty.

Positives

• Increased beneficial ownership by key associated entities and individuals to 23.3% of the outstanding common stock.
• Stefanie Graf has entered into a Brand Partner Agreement, indicating continued strategic engagement and endorsement.
• Warrants previously issued to Investments AKA, LLC were exercised, increasing their direct shareholding.
• The company has secured a $1,000,000 convertible note, potentially providing future capital or indicating a path to equity conversion.

Negatives

• The significant convertible note ($1,000,000) introduces future dilution risk depending on the terms of the next equity financing.
• The conversion price of the note is tied to future equity financings, making the exact future ownership stake uncertain.
• The filing indicates potential future purchases or dispositions of securities, suggesting ongoing strategic adjustments by the reporting persons.

Risks

• Future dilution from the conversion of the $1,000,000 convertible note into equity during the next equity financing.
• The potential for future transactions, including the purchase or disposition of securities, could impact share price and control.
• The exercise of Graf Warrants is contingent on their exercisability within 60 days of the filing date, which is a near-term event.

Future Outlook

The future outlook is influenced by the potential conversion of the $1,000,000 convertible note in the next equity financing of at least $3,000,000, or its maturity on July 27, 2027. The reporting persons retain the right to acquire additional securities or dispose of existing holdings.

Management Comments

• The reporting persons may purchase or acquire additional securities or dispose of some or all of their securities from time to time.
• The reporting persons do not currently have any plans or proposals that would result in extraordinary corporate transactions, changes in board/management, material changes in capitalization or dividend policy, or other material changes to the Issuer's business or corporate structure, except as may occur in the ordinary course of business.

Industry Context

StockSavvy.ai notes that this filing reflects significant stake-building and strategic alignment by parties closely associated with the company's namesake. The issuance of warrants and a convertible note are common mechanisms for incentivizing key individuals and securing future funding, but also introduce potential dilution and complexity.

Related Party Transactions

• Investments AKA, LLC was issued warrants to purchase 705,417 shares of Common Stock for services provided by Andre K. Agassi.
• Stefanie Graf entered into a Brand Partner Agreement and was granted warrants to purchase 1,000,000 shares of Common Stock.
• Investments AKA, LLC purchased 50,000 shares of restricted Common Stock for $250,000.
• Investments AKA, LLC entered into a $1,000,000 Convertible Promissory Note with the Company.

Stakeholder Impact

• Shareholders may experience potential dilution if the convertible note converts into a significant number of new shares.
• Existing shareholders' voting power may be affected by the increased beneficial ownership by the Agassi-related entities.
• The strategic partnerships with Andre Agassi and Stefanie Graf could positively impact brand perception and marketability.

Next Steps

• Monitoring the company's next equity financing event to determine the conversion of the AKA Convertible Note.
• Observing any future purchases or dispositions of Agassi Sports Entertainment Corp. securities by the reporting persons.
• The Graf Warrants are exercisable within 60 days of the filing date, which may lead to further changes in beneficial ownership.

Key Dates

Recommendation

The increased stake by associated entities and strategic partnerships are positive indicators. However, the significant convertible note introduces future dilution risk and uncertainty regarding the exact conversion terms, warranting a 'hold' position until more clarity emerges on future financing and ownership structure.

Keywords

Schedule 13D, Beneficial Ownership, Agassi Sports Entertainment Corp., Warrants, Convertible Note, Investments AKA, LLC, Andre Agassi, Stefanie Graf