Allied Gaming & Entertainment Inc. (NASDAQ: AGAE) Announces Material Definitive Agreement and CEO Guaranty in Settlement with Knighted Pastures

Key Points:

• Allied Gaming & Entertainment Inc. (“Allied” or the “Company”) entered into a material definitive agreement (“Term Sheet”) with Knighted Pastures, LLC, and Yangyang Li (CEO & Chairman) personally.
• The Term Sheet resolves ongoing disputes and litigation between the Company and Knighted Pastures.
• As part of the agreement, Mr. Yangyang Li, in his personal capacity, has executed a personal Guaranty for up to \$5,936,738.36 plus interest, exposing him to joint and several liability.
• The Company has filed a Notice of Dismissal With Prejudice of the Federal Litigation, effective April 17, 2026, signaling the end of the legal dispute.
• Significant restrictions have been placed on both parties regarding future transactions and public communications for two years following the agreement.

Details of the Agreement and Shareholder Impact:

On April 10, 2026, Allied and Knighted Pastures, with CEO Yangyang Li personally, entered a comprehensive settlement agreement (the “Global Resolution”) that includes the following provisions:

• Personal Guaranty by CEO: Mr. Li has entered into a personal Guaranty, making him jointly and severally liable for up to \$5,936,738.36 plus interest. This is a highly material arrangement, as it directly ties the CEO’s personal assets to the Company’s obligations under the settlement. Such guarantees by a sitting CEO are unusual in the public markets and could be interpreted by investors as a strong commitment to resolving disputes but also as an indication of the seriousness of the underlying litigation.
• End of Litigation: Pursuant to the Term Sheet, Allied has filed to dismiss with prejudice its federal litigation with Knighted Pastures. This removes a significant overhang of legal uncertainty, which could positively impact investor sentiment and reduce legal expenses going forward.
• Restrictions on Disparagement and Share Purchases:
  • For a period of two years, both Allied and Knighted Pastures (and their representatives) are prohibited from making disparaging or negative statements about each other, including through press releases, regulatory filings, media, or social media. The only exceptions are for legally compelled testimony or disclosures required by law, or in the course of enforcing the Global Resolution.
  • Knighted Pastures and its principals (including Mr. Choi) have warranted that they do not currently own or control any Allied shares and have no present intention to acquire any. For the next two years, they are barred from acquiring shares, making public acquisition proposals, soliciting proxies, or seeking board representation at Allied without board approval. This non-interference clause removes the risk of near-term activist campaigns or hostile actions from this party.
• Customary Representations & Warranties: The Term Sheet includes standard representations by both parties about their authority to enter into the agreement, further solidifying the enforceability of the resolution.
• Exhibits Filed: The full Term Sheet and the Guaranty are filed as Exhibits 10.1 and 10.2, respectively, and incorporated by reference for further detailed review by investors and analysts.

Potential Share Price Impact:

• Material Exposure of CEO: The CEO’s personal financial exposure may be viewed positively as a sign of confidence and alignment with shareholders, or negatively if investors are concerned about the personal financial stress or potential conflicts of interest for the CEO.
• Removal of Litigation Risk: The settlement and dismissal of litigation removes a major source of uncertainty and distraction, which may lead to improved valuation multiples if investors believe the Company can now focus on operations and growth.
• Stability in Shareholder Base: The two-year standstill agreement regarding share purchases and board activity by Knighted Pastures significantly reduces the risk of hostile actions or activist campaigns, which could support share price stability.
• No Emerging Growth Company Status: The Company is not an “emerging growth company” as defined by the SEC, meaning it is subject to full public company reporting requirements.

Other Relevant Information:

• The Company’s common stock (par value \$0.0001 per share) is traded on the NASDAQ under the symbol “AGAE”.
• This filing contains no written communications, soliciting material, or pre-commencement tender offers, indicating the sole focus is the legal and governance resolution.

Disclaimer: This article is for informational purposes only and is not investment advice. Investors should review the full text of the filings and consult with their financial advisors before making any investment decisions. Past performance is not indicative of future results, and all investments involve risk.

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