425: Signing Day Sports Amends Merger Terms, Details Capital Raise

Signing Day Sports, Inc. amended its Business Combination Agreement with One Blockchain LLC, outlining capital raise proceeds usage and a new equity incentive plan for the combined entity.

Summary

• Amendment No. 1 to the Business Combination Agreement was entered into on November 10, 2025, between Signing Day Sports, Inc. (SGN), One Blockchain LLC, BlockchAIn Digital Infrastructure, Inc. (Holdings), and two merger subsidiaries.
• The amendment clarifies the use of proceeds from Permitted Capital Raises by SGN.
• SGN is permitted to conduct capital raises of up to $4,000,000 via an at-the-market offering and up to $10,000,000 through a purchase agreement with Helena Global Investment Opportunities 1 Ltd. and/or an Alternative Offering.
• Proceeds will cover direct capital raise expenses, up to $1,500,000 for SGN's existing liabilities (including executive consulting agreements), and up to $1,500,000 for One Blockchain's transaction costs.
• Any residual cash after these deductions will be allocated 70% to SGN (plus 100% of Pending Deductions) for working capital and executive consulting agreements, and 30% to BlockchAIn for working capital.
• BlockchAIn will adopt a new equity incentive plan with an initial share reserve of 20% of its fully diluted shares post-Closing and an evergreen provision of 2%.

Sentiment

Score: 7

Explanation: The amendment provides clarity and structure for the ongoing business combination, particularly regarding funding and post-merger equity incentives. While it highlights the need for capital raises, the defined use of proceeds and the establishment of a robust equity plan are positive steps towards a successful merger. The risks outlined are standard for such transactions.

Positives

• Clarification of capital raise terms provides a clearer path for funding the combined entity.
• Establishment of an equity incentive plan (20% initial, 2% evergreen) for BlockchAIn aims to ensure continuity and retention of SGN service providers, which is crucial for post-merger integration.
• Specific allocation of residual cash and liabilities provides financial clarity for both parties post-closing.

Negatives

• SGN remains solely responsible for any of its liabilities outstanding at Closing not covered by the Permitted Capital Raises Deductions.
• The need for significant capital raises (up to $14,000,000) suggests ongoing funding requirements for SGN prior to the merger.

Risks

• Ability of the parties to integrate their respective businesses into a combined publicly listed company post-merger.
• Ability to obtain all necessary consents and approvals, including NYSE American LLC clearance of a listing application and stockholder approval of the Transactions.
• Ability of the parties to obtain sufficient funding to maintain operations and develop additional services and offerings.
• Market acceptance of the parties' current products and services and planned offerings.
• Competition from existing or new offerings that may emerge.
• Impacts from strategic changes to the parties' business on net sales, revenues, income from continuing operations, or other results of operations.
• Ability to attract new users and customers.
• Ability to retain or obtain intellectual property rights.
• Ability to adequately support future growth.
• Ability to comply with user data privacy laws and other current or anticipated legal requirements.
• Ability to attract and retain key personnel to manage their business effectively.

Future Outlook

BlockchAIn plans to file a Registration Statement on Form S-4 with the SEC, which will include a proxy statement for Signing Day Sports stockholders and a prospectus for BlockchAIn shares. The Registration Statement must be declared effective by the SEC before the definitive proxy statement/prospectus is mailed to stockholders, leading to a vote on the proposed business combination. The combined entity will also adopt a new equity incentive plan to ensure continuity and retention of service providers.

Management Comments

• Holdings shall consult in good faith with SGN regarding the material terms of the Holdings Equity Incentive Plan to ensure continuity and retention for SGN service providers.
• SGN acknowledges and agrees that any SGN Liabilities outstanding at Closing shall be the sole responsibility of the Legacy Business.

Industry Context

This amendment is a standard procedural step in a business combination, particularly common in SPAC mergers or complex private-to-public transactions. The focus on capital raises and an equity incentive plan reflects efforts to secure funding and align management incentives for the combined entity, which is typical for companies undergoing significant corporate restructuring or entering new market phases, especially in technology or digital infrastructure sectors (implied by 'BlockchAIn Digital Infrastructure').

Comparison to Industry Standards

• The 20% initial equity incentive plan reserve with a 2% evergreen provision for the combined entity (BlockchAIn) is within the typical range for growth-oriented technology companies post-merger, aiming to attract and retain talent. For example, many tech companies allocate 10-25% of post-merger equity for incentive plans.
• The detailed allocation of capital raise proceeds for pre-merger liabilities and transaction costs is a common practice to ensure a clean balance sheet and smooth transition for the combined entity, similar to how SPACs manage trust account funds and transaction expenses.

Corporate Governance

Stakeholder Impact

• Shareholders (SGN): Will vote on the proposed business combination; their existing options/awards will be treated under the new plan; potential dilution from capital raises.
• Shareholders (BlockchAIn/One Blockchain): Will receive 30% of the residual cash for working capital; new equity incentive plan will impact ownership structure.
• Employees/Service Providers (SGN): The new equity incentive plan is designed to ensure continuity and retention for them.
• Creditors (SGN): Up to $1,500,000 from capital raises allocated to cover existing liabilities.

Next Steps

• BlockchAIn plans to file a Registration Statement on Form S-4 with the SEC.
• The Registration Statement must be declared effective by the SEC.
• A definitive proxy statement/prospectus will be mailed or disseminated to Signing Day Sports stockholders.
• Signing Day Sports stockholders will make a voting decision on the proposed business combination.
• BlockchAIn will adopt a new equity incentive plan no later than the Closing.
• SGN will make a good faith effort to provide One Blockchain with a schedule detailing capital raise amounts, deductions, and residual amounts prior to Closing.

Key Dates

Keywords

Business Combination Agreement, Merger, Capital Raise, Equity Incentive Plan, SEC Filing, Signing Day Sports, One Blockchain, BlockchAIn Digital Infrastructure, Form 8-K, Corporate Governance, Financial Reporting, Stock Offering, NYSE American