Filed 2026-03-31 · Period ending 2025-12-31 · 53,642 words · SEC EDGAR
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# Agassi Sports Entertainment Corp. (AASP) — 10-K
**Filed:** 2026-03-31
**Period ending:** 2025-12-31
**Accession:** 0001472375-26-000109
**Source:** [SEC EDGAR](https://www.sec.gov/Archives/edgar/data/930245/000147237526000109/)
**Origin leaf:** 4c04a62ea0c3349f991f836a7b7a2ef9bb67c6006cee718b9fd019ee1932f8e9
**Words:** 53,642
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UNITED STATES**
**SECURITIES AND EXCHANGE COMMISSION**
**Washington, D.C. 20549**
**FORM 10-K**
(Mark
One)
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For
the fiscal year ended December 31, 2025
OR
[ ] TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission
file number 000-24970
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**Agassi Sports Entertainment Corporation**
(Exact name of registrant as
specified in its charter)****
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Nevada |
88-0203976 |
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(State or other jurisdiction of
incorporation or organization) |
(I. R. S. Employer Identification No.) |
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1120 N Town Center Drive, Suite 160, Las Vegas, NV |
89144 |
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(Address of principal executive offices) |
(Zip Code) |
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Registrants telephone number, including area
code: (702) 317-7302
Securities registered pursuant to
Section 12(b) of the Act: None.
Securities registered pursuant to
Section 12(g) of the Act:
Common Stock, $0.001 Par Value Per share
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act. [ ] Yes [X] No
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Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act. [ ] Yes [X] No
Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [X] Yes [ ] No
Indicate
by check mark whether the registrant has submitted electronically every
Interactive Data File required to be submitted pursuant to Rule 405 of Regulation
S-T during the preceding 12 months (or for such shorter period that the
registrant was required to submit such files). [X] Yes [ ] No
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, a smaller reporting company, or an
emerging growth company. See the definitions of large accelerated filer,
accelerated filer, smaller reporting company and emerging growth company in
Rule 12b-2 of the Exchange Act.
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Large accelerated
filer [ ] |
Accelerated filer [ ] |
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Non-accelerated Filer [X] |
Smaller reporting company [X] Emerging growth company [ ] |
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If an emerging growth company, indicate by
check mark if the registrant has elected not to use the extended transition
period for complying with any new or revised financial accounting standards
provided pursuant to Section 13(a) of the Exchange Act. [ ]
Indicate
by check mark whether the registrant has filed a report on and attestation to
its managements assessment of the effectiveness of its internal control over
financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C.
7262(b)) by the registered public accounting firm that prepared or issued its
audit report. [ ]
If
securities are registered pursuant to Section 12(b) of the Act, indicate by
check mark whether the financial statements of the registrant included in the
filing reflect the correction of an error to previously issued financial
statements. [ ]
Indicate
by check mark whether any of those error corrections are restatements that
required a recovery analysis of incentive-based compensation received by any of
the registrants executive officers during the relevant recovery period
pursuant to Section 240.10D-1(b). [ ]
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). [ ] Yes
[X] No
As of June
30, 2025, the aggregate market value of voting stock held by non-affiliates of
the registrant was approximately $30,874,506 based on the last sale price
reported for the registrants common stock on OTC Markets Group Inc. of $6.00
per share as of June 30, 2025. For
purposes of this response, the registrant has assumed that its directors,
executive officers and beneficial owners of 5% or more of its common stock are
deemed affiliates of the registrant. For purposes of calculating the aggregate
market value of shares held by non-affiliates, we have assumed that all
outstanding shares are held by non-affiliates, except for shares held by each
of our executive officers, directors and 5% or greater stockholders. In the
case of 5% or greater stockholders, we have not deemed such stockholders to be
affiliates unless there are facts and circumstances which would indicate that
such stockholders exercise any control over our company, or unless they hold
10% or more of our outstanding common stock. These assumptions should not be
deemed to constitute an admission that all executive officers, directors and 5%
or greater stockholders are, in fact, affiliates of our company, or that there
are not other persons who may be deemed to be affiliates of our company.
Further information concerning shareholdings of our officers, directors and
principal stockholders is included or incorporated by reference in Part III,
Item 12 of this Annual Report on Form 10-K.
The
number of shares of common stock, $0.001 par value, outstanding on March 27, 2026
was12,633,250shares,
not including 50,000 shares of common stock sold on March 30, 2026, as discussed
in greater detail below under Item 9B. Other Information, which have not been
issued to date.
/s/ RBSM
LLP*
PCAOB ID 587
Houston, TX
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**DOCUMENTS INCORPORATED BY
REFERENCE**
None.
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**TABLE
OF CONTENTS**
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PART I |
1 |
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS |
1 |
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ITEM 1. BUSINESS |
2 |
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ITEM 1A. RISK FACTORS |
12 |
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ITEM 1B. UNRESOLVED STAFF COMMENTS |
35 |
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ITEM 1C. CYBERSECURITY |
35 |
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ITEM 2. PROPERTIES |
35 |
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ITEM 3. LEGAL PROCEEDINGS |
36 |
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ITEM 4. MINE SAFETY DISCLOSURES. |
36 |
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PART II |
37 |
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ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES |
37 |
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ITEM 6. [RESERVED] |
38 |
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ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. |
38 |
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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
41 |
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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA |
41 |
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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE. |
59 |
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ITEM 9A. CONTROLS AND PROCEDURES |
59 |
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ITEM 9B. OTHER INFORMATION |
60 |
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ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS |
61 |
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PART III |
62 |
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ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE |
62 |
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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS |
66 |
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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE |
77 |
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ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES |
79 |
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PART IV |
81 |
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ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES |
81 |
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ITEM 16. FORM 10K SUMMARY. |
82 |
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**PART I**
**CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS**
This Annual Report on Form 10-K
(this Report) contains forward-looking statements. In some cases, you
can identify forward-looking statements by the following words: anticipate,
believe, continue, could, estimate, expect,
intend, may, ongoing, plan, potential,
predict, project, should, or the negative of these
terms or other comparable terminology, although not all forward-looking
statements contain these words. Forward-looking statements are not a guarantee
of future performance or results, and will not necessarily be accurate
indications of the times at, or by, which such performance or results will be
achieved. Forward-looking statements are based on information available at the
time the statements are made and involve known and unknown risks, uncertainties
and other factors that may cause our results, levels of activity, performance
or achievements to be materially different from the information expressed or
implied by the forward-looking statements in this Report. These factors
include:
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our limited operating history, history of losses and lack of
experience in certain aspects of our business, including the court sports
industry; |
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our ability to continue as a going concern and to generate
sufficient revenues to achieve and sustain profitability; |
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our need for additional capital to fund operations and satisfy
obligations, including under agreements with the IBM Parties (defined below),
the availability and terms of such financing and potential dilution to existing
stockholders; |
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our ability to execute our business plan, including the
development, launch and commercialization of our planned platform and mobile
application, the timing and costs associated therewith and the extent to which
we generate revenues from such initiatives; |
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the anticipated benefits of our arrangements with the IBM Parties
and the extent to which such benefits are realized, as well as the demands such
arrangements place on our management and resources; |
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the acceptance by consumers of our products and services and
their willingness to adopt and pay for our offerings; |
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the size, growth and development of the markets in which we
operate, including pickleball and padel, and for our planned platform and
application; |
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our ability to compete effectively in a highly competitive and
evolving industry and to respond to changes in market conditions and consumer
preferences; |
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the impact of general economic, financial and business
conditions, including inflation, interest rates, tariffs, trade policies,
economic slowdowns or recessions and geopolitical events, on discretionary
spending and demand for our products, services and events; |
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our ability to successfully plan, launch and operate events,
including the planned World Series of Pickleball, including securing venues,
obtaining permits, attracting sponsorships, partners and participants, and
managing operational and logistical challenges; |
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risks related to injuries, accidents, security incidents or
other liabilities arising from our operations or events and the adequacy of our
insurance coverage; |
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disruptions to our information technology systems,
cybersecurity threats and unauthorized access to data, and the resulting
operational, legal and reputational risks; |
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risks associated with our use of artificial intelligence
technologies, including regulatory, operational, reputational and competitive risks; |
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our ability to attract, retain and manage key personnel and to
effectively manage our growth, including increased operational scale and
complexity; |
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our ability to protect our intellectual property and avoid
infringing on the intellectual property rights of others; |
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our ability to establish and maintain brand recognition and
customer loyalty; |
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changes in laws, regulations and regulatory requirements
applicable to our business; |
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corporate governance risks and risks related to being a public company,
including increased costs and compliance obligations; |
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the concentration of ownership of our securities and its impact
on corporate decision-making; |
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the market price and liquidity of our common stock; and |
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other risk factors included under Risk Factors below. |
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You should read the matters
described in Risk Factors and the other cautionary statements made in this
Report, as being applicable to all related forward-looking statements wherever
they appear in this Report. We cannot assure you that the forward-looking
statements in this Report will prove to be accurate and therefore prospective
investors are encouraged not to place undue reliance on forward-looking
statements. Other than as required by law, we undertake no obligation to update
or revise these forward-looking statements, even though our situation may
change in the future.
**ITEM 1. BUSINESS**
**Summary Matters and Definitions**
In this Annual Report on Form
10-K (this Report), we may rely on and refer to information regarding
the industries in which we operate in general from market research reports,
analyst reports and other publicly available information. Although we believe
that this information is reliable, we cannot guarantee the accuracy and
completeness of this information, none of this information has been
commissioned by us, and we have not independently verified any of it.
Unless the context requires otherwise,
references to the Company, we, us, our, and
Agassi Sports Entertainment Corp. refer specifically to Agassi Sports
Entertainment Corp.
In addition, unless the context otherwise requires and for the purposes
of this Report only:
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Exchange Act refers to the
Securities Exchange Act of 1934, as amended; |
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SEC or the Commission
refers to the United States Securities and Exchange Commission; and |
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Securities Act refers to the
Securities Act of 1933, as amended. |
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**Where You Can Find Other Information**
We file annual, quarterly, and
current reports, proxy statements and other information with the SEC. The SEC
maintains an Internet site that contains reports, proxy and information
statements, and other information regarding issuers that file electronically
with the SEC like us athttp://www.sec.gov(our filings can be found athttps://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000930245). Copies of documents filed by us with the SEC are also available from us
without charge, upon oral or written request to our Secretary, who can be
contacted at the address and telephone number set forth on the cover page of
this Report. Our website address is https://www.agassisports.com. The information on, or that may be accessed
through, our website is not incorporated by reference into this Report and
should not be considered a part of this Report.
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The Company plans to use press
releases and various social media channels, including its Instagram account (*agassisportsentertainment*),
as additional means of disclosing public information to investors, the media
and others interested in the Company. It is possible that certain information
that the Company disseminates in press releases and on social media could be
deemed to be material information, and the Company encourages investors, the
media and others interested in the Company to review the business and financial
information that the Company disseminates in press releases and on the social
media channels identified above, as such information could be deemed to be
material information. The contents on the Companys website and its social
media channels are not incorporated by reference in this Report.
***Corporate Information*****
Our principal executive offices
are located at 1120 N. Town Center Dr #160, Las Vegas, Nevada 89144, and our
telephone number is (702) 400-4005.
**Corporate History**
The Company was incorporated in Nevada on
March 6, 1984, under the name Sporting Life, Inc. The Companys name was
changed to St. Andrews Golf Corporation on December 27, 1988, to Saint
Andrews Golf Corporation on August 12, 1994, to All-American SportPark, Inc.
on December 14, 1998, and to Global Acquisitions Corporation on February 15,
2021.
In December 1994, the Company completed an
initial public offering of 1,000,000 Units, each Unit consisting of one share
of common stock and one Class A Warrant. The net proceeds to the Company from
this public offering were approximately $3,684,000. The Class A Warrants
expired unexercised on March 15, 1999.
On July 12, 1996, the Company entered into a
lease agreement of land in Las Vegas, Nevada, on which the Company developed a
Golf Center and All-American SportPark, (SportPark) properties. The
SportPark opened for business in October 1998 and was disposed of in May 2001.
On June 15, 2011, the Company entered into a
Stock Transfer Agreement with Saint Andrews pursuant to which the Company
transferred 49% of the outstanding common stock of All-American Golf Center,
Inc. (AAGC), a subsidiary of the Company, to Saint Andrews Golf Shop,
Ltd. (Saint Andrews) in exchange for the cancellation of $600,000 of
debt owed by the Company to Saint Andrews.
Saint Andrews is owned by Ronald S. Boreta, the
Company's Chief Executive Officer, President and a Director, and John Boreta,
his brother. John Boreta is a former principal shareholder of the Company and
became a Director of the Company in 2012 and resigned in October 2024. The debt
owed by the Company to Saint Andrews was from advances made in the past by
Saint Andrews to provide the Company with working capital.
On June 10, 2016, the Company entered into a
Transfer Agreement for the sale and transfer of the Companys remaining 51%
interest in AAGC, which constituted substantially all of the Companys
assets. On October 18, 2016, the Company
completed the closing of the Transfer Agreement pursuant to which the Company
transferred the 51% interest in AAGC to Ronald S. Boreta and John Boreta
(collectively, the Boretas), and also issued to the Boretas 1,000,000 shares
of the Companys common stock, in exchange for the cancellation of promissory
notes held by the Boretas and the interest accrued thereon totaling $8,900,651.
In connection with the closing of the
Transfer Agreement, AAGC assumed the obligation of the Company to pay Ronald S.
Boreta for deferred salary which totaled $342,500. In addition, AAGC cancelled
$4,267,802 in advances previously made by it to the Company to fund its
operations.
Also in connection with the closing of the
Transfer Agreement, entities controlled by the Boretas cancelled $1,286,702
owed to them by the Company. The Company cancelled $24,523 owed to the Company
by entities controlled by the Boretas.
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On October 18, 2016, the Company
completed the closing of the Transfer Agreement for the sale and transfer of
the Companys 51% interest in AAGC, which constituted substantially all of the
Companys assets.
As a result of the closing of the
Transfer Agreement, the Company became a shell company, with nominal
operations and nominal assets. Beginning in October 2016, the Companys purpose
was to seek, investigate and, if such investigation warrants, acquire an
interest in business opportunities presented to us by persons or firms who or
which desire to seek the perceived advantages of a corporation whose securities
are registered pursuant to the Exchange Act.
In November 2024, the
Companys management determined to cease seeking out business opportunities,
mergers or acquisitions, and instead to launch an operating strategy to become
a leader in the global sports entertainment and media industry. The Companys
efforts are initially focused on court sports, beginning with planned growth
opportunities associated with branding and growing the pickleball and padel
industries, both of which are currently experiencing significant growth. The
Company expects its publicly-traded structure to provide a way for the
investing public to participate in these exciting and rapidly growing markets.
On March 25, 2025, the Company
filed an amendment to the Companys Articles of Incorporation, as amended (the
Amendment) with the Secretary of State of the State of Nevada to
change the name of the Company from Global Acquisitions Corporation to Agassi
Sports Entertainment Corp. (the Name Change). The Name Change became
effective at 12:01 A.M. EST on Monday, March 31, 2025. The Name Change was
approved by the Board of Directors of the Company, which in accordance
withSection 78.390(8)of the Nevada Revised States, can
approve amendments to a Nevada corporations articles of
incorporation,without the approval of the stockholders.
**Current Plan of Operations**
We currently plan to create and
manage unique content, building sports communities around entertainment, media,
wellness, education, commerce, and charitable efforts, with the goal of
becoming a leading media and entertainment company in the world of racket
sports.
By identifying opportunities for
co-branding, partnering, and acquisitions, we plan to develop trusted brands in
sports entertainment and bring them together under the Companys brand.
Our planned business model is
designed around proprietary and curated content supported by planned
sponsorships, brand relationships, live event hosting, e-commerce and
merchandising, and licensing and media rights.
We currently plan to undertake
the following, funding permitting:
**Digital Platform**
As discussed
in greater detail below under Material Agreements/Transactions Statement
of Work, Partnership Agreement for Consulting Services and IBM Embedded Solution Agreement, the Company has entered into
several agreements with IBM Norge AS and International Business Machines
Corporation (collectively, the IBM Parties), pursuant to which such
entities have agreed to help us create an artificial intelligence (AI)-powered comprehensive
digital platform designed to serve as the premier online community and wellness
hub for enthusiasts of racket sports, including tennis, padel, and pickleball (the
Platform). The Platform is initially expected to be accessible through
the Companys website and in the future to be accessible as a mobile
application (the App).
The Platform is expected to be called Agassi Intelligence,
and be structured as a digital ecosystem designed to support player
development, community engagement, and personalized experiences across racquet
sports. The Platform is expected to include AI-powered coaching, swing
analysis, and tailored equipment recommendations, beginning with tennis and
expanding into pickleball and padel through a phased release strategy.
The Platform is currently also expected to include what we
are calling Darren AI, which will allow users to change with an AI agent
coded to think like Darren Cahill, Andre Agassis former coach.
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Our planned subscription-based Platform will aim to foster
a holistic approach to racket sports participation, emphasizing not only
performance tracking but also physical, mental, and social well-being.
Key features of the platform are expected to include:
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Performance logging and analytics, enabling users to record
matches, practice sessions, drills, and cross-training activities, with
integration capabilities for wearables such as Apple Watch and Garmin devices
to capture detailed statistics including time on court, rally counts, heart
rate, training load, and shot speed. |
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A robust community and social layer that is expected to allow
users to follow friends, teammates, and local players; share match summaries,
highlights, and achievements; and participate in challenges, leaderboards, and
rankings at local club, city, and global levels, inspired by legendary figures
such as Andre Agassi and Stefanie Graf, our largest stockholder and Brand Partner,
respectively. |
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Premium coaching and educational content, featuring short-form
instructional videos and masterclasses drawing from the philosophies of
prominent racket sports icons, along with curated training plans tailored to
various skill levels from beginner to advanced, live question-and-answer
sessions, ask-me-anything events, and occasional virtual interactions with
professional players and coaches. |
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Play and partner discovery functionality to connect users with
compatible playing partners based on location, skill rating, and preferred
racket sport, with planned future integrations (in later development phases)
for direct booking with club facilities and event systems. |
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Through these integrated elements, the Platform will seek
to position itself as the primary destination for racket sports health and
wellness, extending beyond traditional scorekeeping or competition to support
users' overall physical fitness, mental resilience, and social connections
within the racket sports ecosystem.
Our platform has two main AI powered products, Swing Analysis AI and AI Coaching LLM.
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Our swing analysis is built using both open
source and publicly available (licensable) computer vision models, and
proprietary and internally developed models. The publicly available models
power key point and object detection from video, where we can mitigate risk and
try different models, or change licenses if needed. The proprietary models
analyze the extracted data to provide personalized feedback to a user in a
mobile app, these models have a carefully designed data pipeline which utilize
the extracted key point data, which hence qualifies the utility of the open
source models. |
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The
LLM experience is created in partnership with IBM & Delphi (proprietary
technology from partners, respectively), handling the majority of the
performance of the LLM experience for users. Our input to this model is
carefully selected training data for text and voice, which helps us ensure the
expected quality in coaching for users. We use a proprietary hierarchical
coaching methodology on top of the extracted data in (1) to create a unique
experience for the user. The methodology is not an AI model but helps us
mitigate both risk and hallucination from the LLM experience, by selecting and
translating core coaching principles that we agree with. |
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The Platform, which is currently in beta testing, is currently planned to
launch by the end of the second
quarter of 2026, with a staggered roll-out of e-commerce (tennis
racquets, paddles, sports nutrition, etc.), a personalized racquet/paddle
recommender and an AI coaching model.
The App launch is anticipated to occur in the third or
fourth quarter of 2026, and is planned to include the same coaching AI feature,
as well as swing analysis feedback, motivational challenges, progress tracking,
and social sharing. While it is expected to initially focus on tennis, the
Companys current goal is to expand all features of the app to pickleball and
padel, in the future, with the goal of helping position the platform as a
single hub for racquet sports.
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The estimated cost for the digital platform is segmented
into two elements. The first is the
launch of Darren AI. The costs
associated with that launch
are estimated to be $100,000.
The second is the launch of Agassi Intelligence,
which we estimate to cost a total of
approximately $2,400,000 to implement. Currently, IBM is in final development of the
platform.
We hope that
the Platform and App will create strong and recurring revenue streams, while
also fostering a fun, thriving and informative racquet sports community on a
global scale under the iconic Agassi brand.
**World Series of Pickleball**
As
discussed in greater detail below under Material
Agreements/TransactionsTrademark Acquisition Agreement, on May 31, 2025,
we acquired the rights to the trademark for *World Series of Pickleball*
(the Trademark).
Our
current plans include launching the World Series of Pickleball, which is
intended to be a new championship property owned and developed by the Company.
The
Company hopes that the World Series of Pickleball, which is planned to feature
a marquee open, a team-based championship week welcoming players of all skill
levels from around the world, with prize purses and global celebrity
participants, including involvement from Andre Agassi, alongside everyday
competitors and professionals who choose to enter. The World Series of
Pickleball is planned to be headquartered and launched in Las Vegas. The multi-day
event is expected to bring together competitors from across the globe,
supported by planned premium production, hospitality programming, and
integrated media distribution which is expected to be designed to deliver a
world-class experience for fans and partners.
The Company intends for the World Series of Pickleball to
serve as a long-term commercial platform encompassing sponsorship, media
rights, ticketing, hospitality, and strategic brand partnerships, and the
Company is currently pursuing relationships with leading hospitality and media
organizations to support distribution, audience growth, and sustained
commercial expansion.
To date, the planning and production of the World Series of
Pickleball is in its initial stages, and the Company does not currently have a
timeline for the initial event, and has not entered into any material
agreements in connection therewith, other than with service providers who are
helping the Company plan the event, including TEAM Marketing AG, a
Switzerland-based global leader in the development, sales and delivery of
world-class sports events.
Costs associated with the World Series of Pickleball are expected to have a minimal impact
on the Companys
cash flow because of
expected sponsorship agreements which we hope to
enter into in connection
with such planned event.
As a result, we currently anticipate that substantially
all expenses associated with
the planned event will be covered by those agreements and
associated sponsorship revenue sources.
**Facilities;
Programs and Content**
The
following are in the early stages of development, and we expect the World
Series of Pickleball and our planned digital platform to take priority in the
coming months:
Acquire, build and/or create
physical facilities, leagues, tournaments, events, social communities, and
merchandisers.
Develop strategic relationships
with Best of Class operators and developers in key segments within the
pickleball and padel communities through co-branding and acquisition
opportunities.
Develop our ACE Program of
certifying facilities, social media communities, content creators, coaches,
third-party leagues, and events under a planned marketing brand.
Create and distribute
proprietary and curated content through various media channels.
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IP development and
collaboration.
We also plan to launch a
Pickleball for All charitable initiative to introduce, grow, and develop
pickleball in underserved and disadvantaged communities across the United
States. We expect to work with best of class brands to provide access to our
Fun for Free courts and equipment in public parks, schools, and other
locations that will serve as home courts to communities across the country for
social wellness, practice, learning, and pickleball fun for all. We plan to work
with select merchandisers and retailers to create quality equipment and offer
merchandise at price points which will appeal to beginners and families, with a
portion of the revenue to be reinvested into the Pickleball for All program.
**Material
Agreements/Transactions**
*Trademark Acquisition Agreement*
On May 31, 2025, the Company
entered into a Trademark Acquisition Agreement with Patrick J. Rolfes and Ted
Angelo (the Sellers), the owners of the trademark for *World
Series of Pickleball*. Pursuant to the Trademark Acquisition Agreement,
we acquired all rights to, and ownership of, the Trademark, in consideration
for $25,000 in cash and warrants to purchase 50,000 shares of the Companys
common stock (with warrants to purchase 25,000 shares granted to each
seller)(the Sellers Warrants).
The Trademark Acquisition
Agreement includes customary representations and indemnification obligations of
the sellers, for a transaction of the size and type, as the Trademark
acquisition. As additional consideration payable to each of the sellers, we
agreed that during the lifetime of each of the sellers, we would furnish them
an aggregate of six (6) VIP tickets to all World Series of Pickleball events
produced by or on behalf of the Company. Such tickets are subject to all
the rules and regulations, including standards of behavior, applicable to
tickets generally.
The Sellers Warrants have an
exercise price of $5.75 per share (the closing sales price of the Companys
common stock on the last trading day prior to the entry into the Trademark
Acquisition Agreement) and a three year term and are exercisable only on a cash
basis. The Sellers Warrants include a 4.999% beneficial ownership limitation,
which can be increased to 9.999% by either holder, with at least 61 days prior
written notice to the Company.
Together with its entry into,
and the closing of the transactions contemplated by, the Trademark Acquisition
Agreement, and its change in business focus as discussed above, the Company is
no longer a shell company (as such term is defined in Rule 12b-2 under the
Exchange Act), and effective on the date of the closing of the Trademark
Acquisition Agreement, May 31, 2025, the Company ceased being a shell
Company, and transitioned to being a start-up/development stage company. In
connection therewith, the Company now has (i) a specific business plan and
purpose which required significant expertise and dedication from management to
develop, (ii) a conscionable plan of operations upon which it is executing,
(iii) a clear revenue generation strategy, and (iv) the incurrence of operating
expenses consistent with a Company that is in its development stage, each as
discussed below.
*Consulting Agreements*
The Company, for
consulting services agreed to be rendered, onMarch 6, 2025, issued to
Darren Cahill, warrants to purchase up to 250,000 shares of the Companys
common stock, at the exercise price of $1.70 per share of common stock. The
warrants expire on March 5, 2030. The
warrants are exercisable as to one half of the shares of common stock
immediately, and exercisable as to the remaining half of the shares of common
stock one year following the grant date of the warrants.
The Company, for
consulting services agreed to be rendered, onMarch 6, 2025, issued to
Justin Gimblestob, warrants to purchase up to 500,000 shares of the Companys
common stock, at the exercise price of $1.70 per share of common stock. The
warrants expire on March 5, 2030. The
warrants are exercisable as to one half of the shares of common stock
immediately, and exercisable as to the remaining half of the shares of common
stock one year following the grant date of the warrants.
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The Company, for services
agreed to be rendered as the Companys Chief Financial Officer, onMarch
6, 2025, issued to
Shawn Cable, warrants to purchase up to 100,000 shares of the Companys common
stock, at the exercise price of $1.70 per share of common stock. The warrants
expire on March 5, 2030. The warrants are exercisable as to
one half of the shares of common stock immediately, and exercisable as to the
remaining half of the shares of common stock one year following the grant date
of the warrants.
*Moneta Advisory Services Agreement*
On July 31, 2025, the Company
entered into a Services Agreement (the Services Agreement) with Moneta
Advisory Partners, LLC (Moneta). Pursuant to the Services Agreement,
Moneta agreed to provide us certain media and content-related services through
December 31, 2025, unless earlier terminated in accordance with the terms of the
Services Agreement. In consideration for agreeing to provide services under the
Services Agreement, (a) we agreed to pay Moneta a one-time payment of $50,000
upon execution of the Services Agreement; and monthly payments of $25,000,
beginning on the first day of the second month of the term and continuing
through the remainder of the term; and (b) we granted Moneta a warrant to
purchase 50,000 shares of the Companys common stock (Moneta Warrants), which
vested in full upon grant. The Moneta Warrants have an exercise
price of $6.30 per share (the closing sales price of the Companys common stock
on the date the Services Agreement was entered into) and a three year term and
are exercisable only on a cash basis. The warrants expire on July 31, 2028. The
Moneta Warrants include a 4.999% beneficial ownership limitation, which can be
increased to 9.999% by Moneta, with at least 61 days prior written notice to
the Company. Payments under the agreement are currently
suspended while the Company confirms the timing for required deliverables.
*Statement of Work*
On July 2, 2025, the Company
entered into a Statement of Work (the SOW) with IBM Norge AS (IBM),
pursuant to which IBM agreed to support, and provide services to the Company in
connection with, the Companys goal of launching a state-of-the-art racquet
sport experience, including design and digital product concept services.
The SOW sets forth project
responsibilities, timelines and milestones. The project is expected to start on
July 7, 2025, and to be completed on or before October 30, 2025, and the
Company has agreed to pay IBM $75,000 in consideration for services rendered
pursuant to the SOW, payable upon the completion of certain project milestones
as described in greater detail in the SOW. The SOW may be terminated by either
party with 30 days prior written notice.
The SOW was completed and
$75,000 was paid in 2025.
*Collaboration and Licensing Agreement*
On July 10, 2025, the Company
entered into a Collaboration and Licensing Agreement (the Collaboration
Agreement) with Sport Squad, Inc., which entity owns JOOLA.
Pursuant to the Collaboration
Agreement, the parties confirmed their intention to identify various ventures
(collectively Ventures, each a Venture) which they might
pursue together. Each party may suggest a Venture to the other, and if there is
mutual interest, the parties agree to discuss in good faith how they might best
collaborate and how such Venture can best be brought to fruition, including the
preferred path of development, production and exploitation. Neither party shall
be obligated to pursue any particular Venture, or any specific number of
Ventures.
Ventures may include, without
limitation, the development of products or product lines, live events,
exhibitions, competitions and tournaments, wellness projects, and content for
exploitation in and across various media. It is anticipated that certain
Ventures will involve the use of iconic brands, logos, and related trademarks,
and/or the name, image and likeness rights of various athletes and
celebrities. The acquisition or licensing of the rights in and to any
brands, logos, and/or trademarks, and the name, image, and likeness (NIL)
rights of celebrities and athletes will be the sole responsibility of the
Company to obtain.
The Collaboration Agreement
continues in effect until terminated by either party thereto with written
notice to the non-terminating party and includes customary confidentiality
obligations of the parties.
No Ventures have been identified
as of the date of this Report.
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*Partnership Agreement for Consulting Services*
On October 31, 2025, the Company
entered into a Partnership Agreement for Consulting Services (the Services
Agreement) and a Commitment Agreement (the Commitment Agreement)
with IBM. Pursuant to the Services Agreement, IBM will provide us certain
consulting services to be described in one or more statements of work.
The first statement of work, entered into simultaneously with the Services
Agreement (SoW 1), provides for IBM to create a website, mobile
application, e-commerce, and A.I.-powered video analysis model for the Company
(the A.I. Model) designed to servethe racquet sports community and
create multiple revenue streams between November 1, 2025 and June 30, 2026, in
exchange for a total payment of $2,134,716, payable in monthly installments in
accordance with the terms of SoW 1, including $100,000 within 15 days after
invoice from IBM, for each of November and December 2025, and January and
February 2026, with $204,387 due before February 28, 2026 and $613,161 before
March 20, 2026, and $229,292 due for each month of March through June 2026.
We are also required to reimburse certain travel expenses, living expenses, and
reasonable expenses incurred by IBM in connection with the services provided
under SoW 1. To date, $454,387 has been paid under the Commitment Agreement.
We believe the partnership with IBM supports and will
facilitate the acceleration of our mission to build a global commercial digital
ecosystem around wellness, learning and entertainment. We expect the
partnership, and the A.I. Model, to create strong and recurring revenue
streams, while also fostering a fun, thriving and informative racquet sports
community on a global scale under our iconic Agassi brand.
*Brand Partner Agreement*
On November 22, 2025, we entered
into a Brand Partner Agreement with Stefanie Graf (the Brand Partner
Agreement), who is the spouse of Andre Agassi, our largest shareholder,
and who is a former professional tennis player who among numerous other accolades
was ranked as the world No.
1 in womens singles by the Women's Tennis Association (WTA) for a record 377
weeks, and finished as the year-end No. 1 a record eight times, pursuant to which
Ms. Graf (a Brand Partner) has agreed to serve as a Company advisor,
spokesperson, celebrity endorser and brand partner. Pursuant to the Brand
Partner Agreement, the Brand Partner will (i) participate in certain Company
projects and initiatives, subject to agreement as to scope and compensation in
each instance; (ii) promote the Companys brand and content through public
appearances, interviews, and social media activity, subject to mutual agreement
as to each social media post; and (iii) provide advice and consultation upon
Company request with respect to the Companys brand and content. The
Brand Partner has also licensed her image, name and likeness to the Company for
use in our public relations, advertising and marketing, on a worldwide basis,
subject to the Brand Partners right to disapprove of any particular use. The
Brand Partner Agreement has a five-year term, subject to extension by mutual
agreement.
In consideration for her services
under the Brand Partner Agreement, we granted Ms. Graf warrants to purchase
1,000,000 shares of the Companys common stock at an exercise price of $5.50
per share (the Graf Warrants). The Graf Warrants vested
immediately and have a five-year term. The Graf Warrants are exercisable
as to one half of the shares of common stock immediately, and exercisable as to
the remaining half of the shares of common stock one year following the grant
date. The Graf Warrants may be exercised either by cash payment or via
cashless exercise based on a formula set forth in the Graf Warrants.
The Brand Partner Agreement may
be terminated by either party at any time, with or without cause, upon written
notice. The Brand Partner Agreement includes customary representations of the
parties and confidentiality provisions. The Company may assign its rights under
the Brand Partner Agreement to an affiliate or in connection with the bona fide
sale of the Companys business, whether by way of sale, merger or acquisition,
but the Brand Partner Agreement is otherwise non-assignable.
*IBM Embedded Solution Agreement*
On February 2, 2026, we and
International Business Machines Corporation (International Business)
entered into an Embedded Solution Agreement IBM Cloud Enterprise Savings PLAN
ESA Transaction Document (the Embedded Solution Agreement) and an
Embedded Solution Agreement Attachment for Build Fund Cloud Credits (the Cloud
Credits Attachment).
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Pursuant to the Embedded Solution
Agreement, the Company plans to order and for International Business to integrate
certain International Business cloud services in an AI-powered self-improvement
mobile application for active tennis and pickleball players to be developed by
the Company (the App), in exchange for a minimum payment commitment of
$500,000 for the period between February 1, 2026 and January 31, 2027 (the First
Commitment Period) and $3,300,000 for the period between February 1, 2027
and January 31, 2031 (the Second Commitment Period). The initial
$500,000 commitment is non-refundable and the subsequent $3,300,000 commitment
will become non-refundable unless the Company terminates such commitment by
written notice to International Business on or before December 31, 2026. The
Embedded Solution Agreement has an initial term of one year and will automatically
renew for an additional four years (unless the parties agree to a different
renewal term), unless the Company terminates it by written notice to International
Business on or before December 31, 2026. If International Business and the
Company do not execute a renewal for the continued purchase of International
Business cloud services after the initial renewal term, the Embedded Solution
Agreement will continue on a month-to-month basis until terminated by either
the Company or International Business upon 30 days prior written notice. International
Business will also provide technical support for its cloud services during the
term.
Pursuant to the Cloud Credits
Attachment, International Business will grant the Company up to $250,000 in
cloud credits in three installments over the First Commitment Period, with each
set of cloud credits expiring six months from the date the credits are
applied. Cloud credits are to be used for development and testing of the
Companys embedded solution as part of International Businesss Build Fund
Program. International Business may terminate the Companys cloud credits
for any reason, in International Businesss discretion, including if it
determines that any information supporting the Companys eligibility for
participation was untrue or if the Company breaches the terms of the Cloud
Credits Attachment or the Embedded Solution Agreement.
**Competition**
The
pickleball and padel industries are highly fragmented. We expect to face
competition for our planned physical facilities from fitness clubs and centers;
the YMCA and similar non-profit organizations or community centers; physical
fitness and recreational facilities established by local governments, hospitals
and businesses; racquet, tennis, pickleball and other athletic centers; rental
unit and condominium amenity centers; and country clubs. We expect to face
competition for our planned content and media channels from other fitness based
content providers and other forms of media.
We
also believe that barriers to entry in the relatively nascent pickleball and
padel industry are relatively low. We expect that some of our current
competitors have, and potential competitors may have, longer operating
histories, and significantly greater financial, marketing and other resources
than we do. In addition, business combinations and consolidation in and across
the industries in which we compete could further increase the competition we
face and result in competitors with significantly greater resources than us.
These factors may adversely affect our business, financial condition and future
operating results. These competitors may engage in more extensive research and
development efforts, undertake more far-reaching marketing campaigns and adopt
more aggressive pricing policies, which may allow them to build larger customer
bases or generate revenues more effectively than we do.
Moving
forward, we plan to compete with competitors based on our significant ties to
Andre Agassi, one of the greatest tennis players of all time, who has
transitioned into being a significant proponent of pickleball, and our plans
designed around proprietary and curated content supported by planned
sponsorships, brand relationships, live event hosting, e-commerce and
merchandising, and licensing and media rights.
**Industry**
According to a 2022 Pickleball
Participation Report by the Sports and Fitness Industry Association, pickleball
is among the fastest growing sports in the US and globally for 3 consecutive
years at a rapid growth rate of 223.5% in the United States. There are an
estimated over 36.5 million pickleball players in the US and the pickleball
equipment market was estimated to be worth $65 billion in 2022 with an expected
compounded rate of return of 9%, and expectations to grow to over $155 billion
by 2033.
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**Recent Funding Transactions**
Between November 4, 2024 and
November 7, 2024, the Company entered into a series of subscription agreements
(the Subscription Agreements), in connection with a private placement
offering to accredited investors (the Investors), which offering
closed on November 7, 2024, and pursuant to which we raised aggregate gross
proceeds of $2,500,000 (the Offering). Under the Subscription
Agreements, the maximum amount of the Offering was $2,500,000, which amount was
fully subscribed. In connection with the Offering, we sold to 23 Investors, an
aggregate of 2,631,543 shares of our restricted common stock, par value $0.001
per share (the Shares) for $0.95 per Share.
The Company currently plans to
use the net proceeds from the Offering to advance business operations in the
global racquet sports entertainment business, with an initial focus on consolidating,
building and growing pickleball and Padel related opportunities, and for
working capital and general corporate purposes.
On March 13, 2026, the Company entered
into two Subscription Agreements with two accredited investors (the 2026 Investors),
pursuant to which the 2026 Investors purchased an aggregate of 80,000 shares of
restricted common stock from the Company, for $5.00 per share, or a total of
$400,000. The Subscription Agreements included customary representations and
warranties of the Investors and the Company.
One of the 2026 Investors was the
Boreta Lifetime Trust, whose trustee is Ronald S. Boreta, the Companys
President, Chief Executive Officer and director. The Boreta Trust purchased
50,000 shares of restricted common stock for $5.00 per share or $250,000 in
aggregate.
**Employees**
The Company currently has five full-time and one-part time employees.
None of our employees are represented
by a labor union or covered by a collective bargaining agreement.
We are focused on the safety, retention and development of our existing
employees. We promote a holistic approach to building our team and believe we have
created a culture that is inclusive, diverse and high performing. We believe
our compensation programs are competitive relative to others in our industry
and are designed to attract, retain and reward personnel through the
combination of cash-based compensation, equity-based compensation and benefits.
**Intellectual Property****
We
rely on a combination of patent, trademark, copyright and trade secret laws in
the United States and other jurisdictions as well as confidentiality procedures
and contractual provisions to protect our proprietary technology, trade
secrets, technical know-how and other proprietary information. We enter into
confidentiality agreements with our consultants and enter into confidentiality
agreements with other parties.
Intellectual
property laws, procedures, and restrictions provide only limited protection and
any of our intellectual property rights may be challenged, invalidated,
circumvented, infringed, or misappropriated. Further, the laws of certain
countries do not protect proprietary rights to the same extent as the laws of
the United States and, therefore, in certain jurisdictions, we may be unable to
protect our proprietary technology. Despite our efforts to protect our
proprietary technology and our intellectual property rights, unauthorized
parties may attempt to copy or obtain and use our technology to develop
applications with the same functionality as our applications. Policing
unauthorized use of our technology and intellectual property rights is
difficult.
Although
we believe that our name is protected by applicable state common law trademark
laws, we do not currently have any patents, concessions, licenses, royalty
agreements, or franchises. We do however own the rights to the U.S. trademark
for, World Series of Pickleball for use in goods and services, bags
and organizing,
conducting and operating tournaments.
**Government Regulations**
Our planned operations will be
subject to a variety of laws and regulations in the United States and around
the world that involve matters central to our business. Many of these laws and
regulations are still evolving and being tested in courts, and could be interpreted
in ways that could have a negative impact on our business. These laws may
relate to privacy and data protection, online safety, rights of publicity,
content, intellectual property, advertising, marketing, distribution, data
security, electronic contracts and other communications, artificial
intelligence, competition, protection of minors, consumer protection,
telecommunications, taxation, economic or other trade prohibitions or
sanctions, anti-corruption law compliance, securities law compliance, online
payment services, and labor and employment. Additionally, foreign data
protection, privacy, content, competition, and other laws and regulations can
impose different obligations or be more restrictive than those in the United
States. U.S. federal and state and foreign laws and regulations, which in some
cases can be enforced by private parties in addition to government entities,
are constantly evolving and can be subject to significant change. As a result,
the application, interpretation, and enforcement of these laws and regulations
are often uncertain and difficult to predict, particularly in the rapidly
evolving industry in which we plan to operate, and may be interpreted and
applied inconsistently from country to country and inconsistently with our
current policies and practices.
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Proposed, new and evolving
legislation and regulations, as well as evolving interpretations of and
practices around certain regulations, could also significantly affect our
business. For example, the implications of the European Union General Data
Protection Regulation (GDPR) and the GDPR as it applies in the United
Kingdom by virtue of the European Union (Withdrawal) Act 2018 (UK GDPR),
which will apply to our processing of personal data in connection with certain
products and services we may offer in the future, are far-reaching and
responses to these continue to develop. In addition to these laws, there are a
number of legislative proposals in the EU as well as other jurisdictions that
could impose new obligations or limitations in areas affecting our business. In
the United States, there are a number of existing state laws, such as those in
California, Virginia, Colorado, Connecticut, Utah and Illinois, as well as
others that are to come into force in the coming years, in addition to a
potential comprehensive federal privacy statute. Agencies such as the Federal
Trade Commission are increasing their enforcement efforts and considering
adopting new privacy rules. New privacy laws or regulations are likely to grant
enhanced privacy rights to individuals and impose obligations on us as a
business operating in those jurisdictions. In addition, some countries are
considering or have passed legislation requiring local storage and processing
of data or similar requirements that could increase the cost and complexity of
delivering our future services. For information regarding risks related to
certain of these compliance requirements, please see *Item 1ARisk
FactorsRegulatory, Corporate Governance and Reporting RisksChanging
regulations and increased awareness relating to privacy, information security
and data protection could increase our costs, affect or limit how we collect
and use personal information and harm our brand*.
Our planned operations will also be
subject to laws and regulations at federal, state, and local levels, related to
wage and hour and other labor and employment laws.
The foregoing description does
not include an exhaustive list of the laws and regulations governing or
impacting our business.
**ITEM 1A. RISK FACTORS**
*The business, financial condition
and operating results of the Company can be affected by a number of factors,
whether currently known or unknown, including but not limited to those
described below, any one or more of which could, directly or indirectly, cause
the Companys actual financial condition and operating results to vary
materially from past, or from anticipated future, financial condition and
operating results. Any of these factors, in whole or in part, could materially
and adversely affect the Companys business, financial condition, operating
results and stock price.*
**Summary Risk Factors**
*Risks Related to Our Need for Funding and Limited Business
History***
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We will
require additional financing to fund our operations and meet obligations,
including under our agreements with the IBM Parties, and such financing may not
be available on favorable terms, or at all. |
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Our need
for additional capital raises substantial doubt about our ability to continue
as a going concern. |
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We have
a limited operating history, including no experience in the court sports
industry, and have incurred significant losses since inception. |
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Our
business model is unproven, and we may never achieve or sustain profitability. |
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We
operate in a highly competitive market and may be unable to compete
effectively. |
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*Risks Related to Our Planned Platform and Mobile
Application***
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The
anticipated benefits of our transactions with the IBM Parties are uncertain and
may not be realized. |
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Our
obligations under the IBM Parties agreements may require substantial management
attention and resources. |
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The
market for our planned platform and mobile application is unproven and may not
develop as expected. |
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Consumers
may be reluctant to adopt or pay for our planned platform or application. |
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We may
not successfully develop or timely launch our planned platform or application. |
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Our
products and services may not achieve market acceptance. |
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Our
business may be adversely affected by changes in consumer preferences,
discretionary spending and economic conditions. |
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The use
of artificial intelligence in our products may create operational, legal,
reputational and competitive risks. |
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Disruptions
to our information systems could adversely affect our business. |
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Cybersecurity
breaches or unauthorized access to customer data could harm our reputation and
result in significant liability. |
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*Risks Related to the Planned World Series of Pickleball***
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We may
be unable to secure suitable venues or obtain necessary permits and approvals
to host events. |
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We may
be unable to attract sufficient sponsorships, brand partnerships, players or
participants. |
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We may
encounter significant operational and logistical challenges in executing
events. |
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Our
business depends on discretionary consumer and corporate spending, which is
subject to economic conditions. |
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We may
face liability for injuries, accidents or security incidents at events, and our
insurance coverage may be inadequate. |
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Our
limited operating history and unproven model increase the risk that we will not
successfully launch or scale this initiative. |
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*Risks Related to the Pickleball and Padel Industries***
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Our
growth strategy depends on expansion in the pickleball and padel industries,
which are competitive and evolving. |
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Unfavorable
economic conditions may reduce discretionary spending and demand for our products
and services. |
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We face
significant competition and may not be able to compete successfully against
current or future competitors. |
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We may
be subject to claims related to the construction or operation of facilities and
related activities. |
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We may
be unable to maintain adequate insurance coverage on acceptable terms. |
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We have
not yet established strong brand recognition or customer loyalty. |
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Our
ability to grow depends on effective management of increased operational scale
and complexity. |
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Our
products and services may not achieve or maintain sufficient market acceptance. |
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*Risks Relating to Management and Key Relationships***
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Our
business depends on our management team, and the loss of key personnel could
adversely affect our operations. |
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We rely
significantly on Andre Agassi, and the
loss of this relationship could materially harm our business. |
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We lack
independent directors, which may raise corporate governance concerns and
negatively impact investor perception. |
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Conflicts
with strategic partners could adversely affect our business. |
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*Regulatory, Corporate Governance and Reporting Risks***
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We have
identified material weaknesses in our internal control over financial reporting
and disclosure controls and procedures and failure to remediate these weaknesses
could result in material misstatements and failure to meet reporting
obligations. |
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As we
are not subject to certain corporate governance requirements, stockholders may
have limited protections against conflicts of interest. |
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Evolving
privacy, data protection and information security regulations may increase
costs and restrict our operations. |
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*Risks Relating to Intellectual Property***
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We may
be unable to adequately protect our intellectual property rights from
unauthorized use. |
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Our
intellectual property rights may not be effectively protected outside the
United States. |
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*Risks Relating to Our Common Stock***
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Our
common stock is illiquid and volatile and may remain so. |
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Future
sales of securities, including upon exercise of outstanding warrants, may
adversely affect our stock price. |
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Our
officers, directors and affiliates, including Andre
Agassi, control a significant percentage of our voting power, limiting
other stockholders ability to influence corporate matters. |
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Stockholders
may experience substantial dilution from future equity issuances. |
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We do
not intend to pay dividends in the foreseeable future. |
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Our
common stock is considered a penny stock, which may make it more difficult to
trade. |
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*General Risk Factors***
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Our
ability to grow and compete depends on access to capital. |
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We may
be unable to effectively manage future growth or integrate acquisitions. |
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Ongoing
SEC reporting and compliance costs may strain our resources if revenues are
insufficient. |
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Changes
in accounting standards or interpretations may adversely affect our reported
results. |
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Short
selling of our common stock may cause its price to decline. |
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Global
economic conditions may adversely affect our business and financial condition. |
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Climate
change and related regulatory or market responses may adversely impact our
operations. |
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**Risk Factors**
**Risks Related to Our Need for
Funding and Limited Business History**
**We will need to raise additional funding in the future,
including to fulfill our obligations under the IBM agreements, which may not be
available on favorable terms, or at all.**
We are required to make payments
to IBM under the Services Agreement and SoW 1 totaling approximately $2,134,716,
payable in monthly installments in accordance with the terms of SoW 1,
including $100,000 within 15 days after invoice from IBM, for each of November
and December 2025, and January and February 2026, with $204,387 due before
February 28, 2026 and $613,161 before March 20, 2026, and $229,292 due for each
month of March through June 2026. To date,
$454,387 of this amount has been paid.
Pursuant to the Embedded Solution
Agreement, the Company has to pay International Business a minimum payment
commitment of $500,000 for the period between February 1, 2026 and January 31,
2027 and $3,300,000 for the period
between February 1, 2027 and January 31, 2031.
The initial $500,000 commitment is non-refundable and the subsequent
$3,300,000 commitment will become non-refundable unless the Company terminates
such commitment by written notice to International Business on or before
December 31, 2026. To date, no payments have been made
under the Embedded Solution Agreement.
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The most likely source of these funds will be through the sale of
equity capital. Any sale of share capital will result in dilution to existing
stockholders. Furthermore, we may incur debt in the future, and may not have
sufficient funds to repay our future indebtedness or may default on our future
debts, jeopardizing our business viability.
We may not be able to borrow or raise additional capital in the
future to meet our needs or to otherwise provide the capital necessary to
expand our operations and business, which might result in the value of our
common stock decreasing in value or becoming worthless. Additional financing
may not be available to us on terms that are acceptable. Consequently, we may
not be able to proceed with our intended business plans. Substantial additional
funds will still be required if we are to reach our goals that are outlined in
this Report. Obtaining additional financing contains risks, including:
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additional equity financing may not be available to us on
satisfactory terms and any equity we are able to issue could lead to dilution
for current stockholders; |
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loans or other debt instruments may have terms and/or
conditions, such as interest rate, restrictive covenants and control or
revocation provisions, which are not acceptable to management or our directors; |
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the current environment in capital markets combined with our
capital constraints may prevent us from being able to obtain adequate debt
financing; and |
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if we fail to obtain required additional financing to pay
amounts to the IBM Parties, the IBM Parties may terminate their agreements with
us, we may be unable to grow our business, we will need to delay or scale back
our business plan, and/or reduce our operating costs, each of which would have
a material adverse effect on our business, future prospects, and financial
condition. |
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In addition, pursuant to the Commitment Agreement, we may be
required to pay IBM a performance bonus equal to between 2% and 2.5% of net
revenues generated from our arrangements with IBM, minus costs from IBM, but
not other expenses or costs of such revenues, which may be significant. If we
do not generate sufficient revenues, we may need to raise additional funds to
satisfy these obligations. Additional funding may not be available on favorable
terms or at all, and the failure to obtain necessary funding could adversely
affect our business, financial condition, results of operations, and prospects.
**Our need to raise additional financing
raises questions about our ability to continue as a going concern.**
Our independent auditors have indicated in their report on our
December 31, 2025 and 2024 financial statements that there is substantial doubt
about our ability to continue as a going concern. A going concern opinion
indicates that the financial statements incorporated in this Annual Report have
been prepared assuming that we will continue as a going concern for one year
from the date the financial statements are issued and do not include any
adjustments to reflect the possible future effects on the recoverability and
classification of assets, or the amounts and classification of liabilities that
may result if we do not continue as a going concern. Therefore, you should not
rely on our balance sheet as an indication of the amount of proceeds that would
be available to satisfy claims of creditors, and potentially be available for
distribution to shareholders, in the event of liquidation. We had an
accumulated deficit of $39,630,102, as of December 31, 2025. We expect to
require additional funding in the future to continue our business plan, including
under the IBM Parties agreements as discussed above, and to expand or complete
acquisitions. In the event we require additional funding in the future, the
most likely source of future funds presently available to us will be through
the sale of equity capital. Any sale of share capital will result in dilution
to existing stockholders. Furthermore, we may incur debt in the future, and may
not have sufficient funds to repay our future indebtedness or may default on
our future debts, jeopardizing our business viability.
We may not be able to borrow or raise additional capital in the
future to meet our needs or to otherwise provide the capital necessary to
expand our operations and business, which might result in the value of our
common stock decreasing in value or becoming worthless. Additional financing
may not be available to us on terms that are acceptable. Consequently, we may
not be able to proceed with our intended business plans. Substantial additional
funds will still be required if we are to reach our goals that are outlined in
this Report. Obtaining additional financing contains risks, including:
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additional equity financing may not be
available to us on satisfactory terms and any equity we are able to issue
could lead to dilution for current stockholders; |
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loans or other debt instruments may have
terms and/or conditions, such as interest rate, restrictive covenants and
control or revocation provisions, which are not acceptable to management or
our directors; |
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the current environment in capital markets
combined with our capital constraints may prevent us from being able to
obtain adequate debt financing; and |
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if we fail to obtain required additional
financing to grow our business, we will need to delay or scale back our
business plan, and/or reduce our operating costs, each of which would have a
material adverse effect on our business, future prospects, and financial
condition. |
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**Because we have a limited operating history our future operations
may not result in profitable operations.**
There is no significant operating history upon which to base any
assumption as to the likelihood that we will prove successful, and we may never
achieve profitable operations. If we are unsuccessful in addressing these
risks, our business will most likely fail. We have not generated any revenues
for the years ended December 31, 2025 or 2024, and may never generate revenues,
or profitable operations, in the future.
**We have no operating history in
the court sports industry and have incurred significant operating losses since
inception. We may never become profitable or, if achieved, be able to sustain
profitability.**
We have no operating history in the court sports industry upon
which to base any assumption as to the likelihood that our operations will prove
successful, and we may never achieve profitable operations. We currently expect
to incur net losses for the foreseeable future. Even if we do achieve
profitability, there can be no guarantee that we will be able to sustain
profitability. If we are unsuccessful in operating our business, it will have a
material adverse impact on our business, financial condition and results of
operations.
****
**The court sport industry is highly competitive, and
iftheCompanyfailsto compete effectively,it could
have a material adverse effect on the Company.**
The court sports industry is highly competitive. A number of
companies offer services that are similar to the Companys planned services.
The majority of the Companys current and potential competitors have longer operating
histories, significantly greater financial, technical and marketing resources,
greater name recognition, broader or more integrated product offerings, larger
staffs and a larger installed customer base. These competitors may be able to
respond more quickly to new or emerging technologies and changes in customer
requirements, develop superior services, and devote greater resources to the
development, promotion and sale of services than the Company can.
**Risks Related to Our Planned
Platform and Mobile Application**
**The success of our transactions with the IBM Parties are
uncertain and may not produce the anticipated benefits.**
**
The outcomes of our agreements with the IBM Parties, including the
development of the A.I. Model and other services under SoW 1, are subject to
significant uncertainties, including technical, operational, and market risks.
We may not be able to generate sufficient revenues from the A.I. Model or other
services to achieve our business objectives or justify the expenditures under
the agreements. As a result, the anticipated benefits of these arrangements,
including new revenue streams and strategic advantages, may not be realized,
which could adversely affect our business, financial condition, and results of
operations.
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**Our obligations under the IBM agreements may require
substantial management attention and resources.**
The Services Agreement, SoW 1, and the Commitment Agreement will
require us to devote significant management time, personnel, and financial
resources to our relationship with the IBM Parties. This may divert attention
and resources from other initiatives or opportunities that may be more
immediately accretive to shareholders. Additionally, we may be required to hire
or retain additional personnel or engage external advisors to support our
obligations under the agreements. If we are unable to adequately manage these
commitments, it could adversely affect our operations, growth prospects, and
results of operations. Additionally, these efforts may not lead to the anticipated
benefits, and any resources expendedwhether time, personnel, or financialmay
be lost, which could also adversely affect our operations, growth prospects,
and results of operations.
**The market for our planned Platform and App is unknown at this
time.**
****
The market for an online community and wellness hub for
enthusiasts of racket sports, including tennis, padel, and pickleball is
unknown at this time. It is uncertain to what extent market acceptance of our
planned Platform and App will be, and/or whether the market will grow in the
future, if at all. If the public does not perceive our Platform or App as
beneficial, or chooses not to use or pay for our Platform and/or App, then the
market for our offerings may not develop, may develop more slowly than we
expect or may not achieve the growth potential we expect. As a result, the
number of potential users using our services cannot be predicted with any
degree of certainty, and we cannot assure you that we will be able to operate
in a profitable manner in the future. Any of the foregoing could materially
adversely affect our business, financial condition and results of operations.
We anticipate that growth of our business will require significant
investments in our infrastructure, technology and marketing and sales efforts.
Our current cash flow has not been sufficient to support these needs. If our
business does not generate the level of available cash flow required to support
these investments, our results of operations will be negatively affected. Further,
our ability to effectively manage growth and expansion of our operations will
also require us to enhance our operational systems, internal controls and
infrastructure, human resources policies and reporting systems. These
enhancements will require significant capital expenditures and allocation of
valuable management and employee resources.
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**There may be reluctance by consumers to use our Platform or App,
or unwillingness to pay our subscription prices.**
****
Our growth is expected to be highly dependent upon the adoption by
consumers of our planned Platform and App. If consumers do not adopt the
Platform or App or are not willing to pay the prices we plan to charge for our
offerings, our business may never materialize and our, prospects, financial
condition and operating results will be harmed. This market is new, rapidly
evolving, characterized by rapidly changing technologies, price competition,
additional competitors, and changing consumer demands and behaviors.
Our success will depend on our ability to market our Platform and
App to potential customers, customer demand and price sensitivity. Demand and
price sensitivity may fluctuate based on a variety of factors, including
macroeconomic factors, quality of service, negative publicity, quality of customer
support, or dissatisfaction with our products and offerings in general. If we
fail to attract users or fail to accurately predict demand and price
sensitivity, it would harm our financial performance and our competitors
products may achieve greater market adoption and may grow at a faster rate than
our service.
**We may not be able to launch our planned Platform by the end of
the second quarter of 2026, or our App in the second or third quarters of 2026,
as currently projected.**
****
We will need to complete the build out of our Platform and App
before commercially launching those. Any delay in the financing, design,
buildout and launch of our Platform and/or App could delay, or could prevent,
the commercial launch of the Platform and App. Platforms and applications often
experience delays in their design, build-out and commercial release. These
delays may result in additional costs and if we are not able to overcome these
challenges, our business, prospects, operating results and financial condition
will be negatively impacted and our ability to grow our business will be
harmed.
**We may be unable to effectively build a Platform or App.**
****
We have not yet developed the Platform or App that we have
discussed above. We may experience difficulty in developing the applications
necessary to operate the business, including the Platform and App, which may
result in adverse effects on our business. The software underlying the Platform
and App is expected to be highly complex and may contain undetected errors or
vulnerabilities, some of which may only be discovered after the programs have
been released. Third-party software that we incorporate into our Platform
and App may also be subject to errors or vulnerabilities. Any errors or
vulnerabilities discovered in our Platform or App, whether in our proprietary
code or that of thirdthird-party software on which our software relies,
could result in negative publicity, a loss of users or loss of revenue, access
or other performance issues, security incidents, or other liabilities. We may
need to expend significant financial and development resources to analyze,
correct, eliminate or work around errors or defects or to address and eliminate
vulnerabilities. Any failure to timely and effectively resolve any such errors,
defects or vulnerabilities could adversely affect our business, financial
condition and results of operations as well as negatively impact our reputation
or brand. Our systems, or those of third parties upon which we rely, may
experience service interruptions, outages, or degradation because of hardware
and software defects or malfunctions, human error or malfeasance by third
parties or our employees, contractors, or service providers, earthquakes,
hurricanes, floods, fires, natural disasters, power losses, disruptions in
telecommunications services, fraud, military or political conflicts, terrorist
attacks, cyberattacks or other events.
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**Our prospects and operations may be adversely affected by changes
in consumer preferences, discretionary spending and other economic conditions
that affect demand for our services.**
****
Our business is expected to be vulnerable to changes in consumer
preferences, discretionary spending and other market changes impacting
discretionary purchases. The global economy has in the past, and will in the
future, experience recessionary periods and periods of economic instability.
During such periods, our potential customers may choose not to make
discretionary purchases or may reduce overall spending on discretionary purchases.
Such changes could result in reduced consumer demand for our products and
services. If we are unable to generate demand or there is a future shift in
consumer spending away from our future products or services, our business,
financial condition and results of operations could be adversely affected.
**We plan
to use AI in our products and services which may result in operational
challenges, legal liability, reputational concerns and competitive risks.**
AI is expected to be enabled by
or integrated into our Platform and App. As with many developing technologies,
AI presents risks and challenges that could affect its further development,
adoption, and use, and therefore our business. Many known and unknown risks to
AI exist. Some of the currently known risks include accuracy, bias, toxicity,
intellectual property infringement or misappropriation, data privacy and
cybersecurity and data provenance. For example, our development and use of AI
may result in the incorporation of third-party data, including personal,
proprietary or confidential data, into our AI. If we do not have sufficient
rights to use the data on which AI relies, we may incur liability through the
violation of such laws, third-party privacy or other rights or contracts to
which we are a party.
Additionally, regulation in the
AI space is constantly changing, and may make it difficult to continue using
our AI. AI is the subject of evolving review by various U.S. governmental and
regulatory agencies, including the SEC and the Federal Trade Commission, or the
FTC, and various U.S. states and other foreign jurisdictions are applying, or
are considering applying, their cybersecurity and data protection laws to AI,
particularly generative AI, and/or are considering general legal frameworks on
AI. In addition, the use and deployment of AI presents complexities and
challenges with respect to compliance with applicable laws and regulations.
Additionally, algorithms may be
flawed or biased, and datasets may be insufficient, of poor quality or contain
biased information. Overcoming technical obstacles and correcting defects or
errors could prove to be impossible or impracticable, and the costs incurred
may be substantial and adversely affect our results of operations. If the
recommendations, or analyses that our Platforms AI applications assist in
producing are deficient or inaccurate, we could be subjected to competitive
harm, potential legal liability and brand or reputational harm. Further,
content generated by AI may be offensive, biased, or harmful, or violate
current or future laws and regulations, and our reliance on AI could pose
ethical concerns and lead to a lack of human oversight and control.
Our investments in deploying AI
technologies may be substantial and may be more expensive than anticipated. If
our Platform does not function reliably, fails to meet expectations in terms of
performance, or cannot be fully utilized due to increasing regulation or
reputational concerns, we may be unable to provide such services, our customers
may stop using our products, or our competitors may incorporate AI technology
into their products or services more successfully than we do, all of which may
impair our ability to effectively compete in the market.
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**Any material disruption in our information systems could adversely
affect our business.**
We expect to rely on information technology networks and systems
to operate and manage our future business. Our information technology networks
and systems will process, transmit and store personal and financial
information, proprietary information of our business, and also allow us to
communicate with our employees and externally with customers, suppliers,
partners and other third parties. While we believe we take reasonable steps to,
and plan to continue to take reasonable steps to, secure these information
technology networks and systems, and the data processed, transmitted, and
stored thereon, such networks, systems, and data may be susceptible to
cyberattacks, viruses, malware, or other unauthorized access or damage (including
by environmental, malicious, or negligent acts), which could result in
unauthorized access to, or the release and public exposure of, our proprietary
information. Any of the foregoing could cause substantial harm to our business,
require us to make notifications to governmental authorities, or the media, and
could result in litigation, investigations or inquiries by government
authorities, or subject us to penalties, fines, and other losses relating to
the investigation and remediation of such an attack or other unauthorized
access or damage to our information technology systems and networks.
****
**If we or ourthird-partyservice providers experience a
security breach, or if unauthorized parties otherwise obtain access to our
customers data, our reputation may be harmed, demand for services may be
reduced, and we may incur significant liabilities.**
****
Our services are expected to involve the storage, processing and
transmission of data, including certain confidential and sensitive information.
Any security breach, including those resulting from a cybersecurity attack,
phishing attack, or any unauthorized access, unauthorized usage, virus or
similar breach or disruption could result in the loss or destruction of or
unauthorized access to, or use, alteration, disclosure, or acquisition of,
data, damage to our reputation, litigation, regulatory investigations, or other
liabilities. These attacks may come from individual hackers, criminal groups,
andstate-sponsored organizations. If our security measures are breached
as a result ofthird-party action, employee error, a defect or bug
in our products or those of ourthird-party service providers,
malfeasance or otherwise and, as a result, someone obtains unauthorized access
to our data, including our confidential, sensitive, or other information about
individuals, or any of these types of information is lost, destroyed, or used,
altered, disclosed, or acquired without authorization, our reputation may be
damaged, our business may suffer, and we could incur significant liability.
Even the perception of inadequate security may damage our reputation and
negatively impact our ability to win new customers and retain and receive
timely payments from existing customers. Further, we could be required to
expend significant capital and other resources to address any data security
incident or breach, which may not be covered or fully covered by our insurance
and which may involve payments for investigations, forensic analyses, legal
advice, public relations advice, system repair or replacement, or other
services.
We expect to engagethird-partyvendors and service
providers to store and otherwise process our data, including confidential,
sensitive, and other information about individuals. Our vendors and service
providers may also be the targets of cyberattacks, malicious software, phishing
schemes, and fraud. Our ability to monitor our vendors and service providers
data security is limited, and, in any event, third parties may be able to
circumvent those security measures, resulting in the unauthorized access to,
misuse, acquisition, disclosure, loss, alteration, or destruction of our data,
including confidential, sensitive, and other information about individuals.
Techniques used to sabotage or obtain unauthorized access to systems
or networks are constantly evolving and, in some instances, are not identified
until after they have been launched against a target. We and our service
providers may be unable to anticipate these techniques, react in a timely
manner, or implement adequate preventative and mitigating measures. If we are
unable to efficiently and effectively maintain and upgrade our system
safeguards, we may incur unexpected costs and certain of our systems may become
more vulnerable to unauthorized access or disruption.
**Risks
Related to the Planned World Series of Pickleball**
**We may be unable to secure suitable venues or
locations on acceptable terms, or at all, which could prevent us from launching
or scaling our planned World Series of Pickleball.**
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We
will need to identify, negotiate, and secure stadiums, tennis facilities, or
other appropriate venues in one or more cities for the World Series of
Pickleball (and any future events in the series). Desirable locations may not
be available at an acceptable cost or on a timely basis due to competition from
established events, scheduling conflicts, zoning, licensing, or environmental
requirements. Even if secured, we may be unable to attract sufficient
spectators, players, or media attention to those locations. Any failure or delay
in securing venues could materially delay or prevent us from hosting the
series, harm our reputation, and cause us to incur significant pre-event
expenses without corresponding revenue.
**We may fail to obtain necessary permits,
licenses, approvals, or sanctions from local authorities, which could delay or
prohibit us from hosting events.**
Hosting
a professional-level pickleball tournament series requires permits, liquor
licenses (if applicable), health/safety approvals, and potentially official
sanctioning or cooperation. These processes can be expensive, time-consuming,
and subject to political, regulatory, or public-health restrictions. There is
no guarantee we will obtain them on a timely or cost-effective basis. Delays or
denials could jeopardize our ability to schedule or execute events, expose us
to penalties, or force us to cancel or relocate tournaments.
**We may be unable to attract or retain
sufficient sponsorships and brand partnerships, which are expected to be a
primary source of revenue.**
A
significant portion of our anticipated revenue from the planned World Series of
Pickleball is expected to come from corporate sponsorships, naming rights, and
brand partnerships. Sponsors and advertisers may be unwilling to commit budgets
to a new, unproven tournament series, particularly in periods of economic
uncertainty or reduced discretionary corporate spending. If we fail to attract
or retain sponsors on favorable terms, or if existing sponsors reduce or cancel
commitments, our revenues could be materially and adversely affected. We also
face competition for sponsorship dollars from established events and other
major sports and entertainment properties.
**We
may be unable to attract high-quality players or sufficient participant
interest through our advertising and recruitment efforts.**
The
success of the World Series of Pickleball is expected to depend on attracting
top-ranked or prominent players. Our marketing and advertising campaigns aimed
at players may fail to resonate, or we may be unable to offer prize money,
scheduling, or other incentives competitive with alternative events. If players
perceive the series as lacking prestige, or financial upside, or if they
prioritize other commitments, participation could be low. Failure to build and
maintain player engagement would reduce the quality and appeal of the events,
harm spectator and media interest, and materially adversely affect ticket
sales, sponsorship value, and overall revenue.
**We may encounter significant operational and
logistical challenges in executing the events, including staffing, equipment,
travel, security, and supply-chain issues.**
Organizing
and hosting a pickleball event involves complex logistics: court setup and
maintenance, player and staff travel and accommodations, equipment procurement,
ticketing systems, security, medical services, and on-site operations. We have
no prior operating history with events of this scale. Any disruptions (such as
labor disputes, union negotiations, vendor failures, transportation delays, or
unforeseen cost overruns), could delay events, increase expenses beyond
budgets, or result in poor execution that damages our reputation and deters
future participation or attendance.
**Our business will depend on discretionary
consumer and corporate spending, which is subject to economic conditions and
other external factors beyond our control.**
Revenue
from ticket sales, sponsorships, hospitality, and related activities is highly
sensitive to general economic conditions, unemployment, inflation, fuel prices,
and consumer confidence. In downturns or periods of reduced discretionary
spending, attendance at live sports events and corporate sponsorship budgets
typically decline. Public-health crises, natural disasters, or geopolitical
events could further cause cancellations, travel restrictions, or shifts away
from in-person events, materially harming our expected results.
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**We may face liability for injuries,
accidents, or security incidents at our events, and our insurance may be
inadequate.**
Hosting
live sporting events exposes us to risks of player or spectator injuries,
accidents, thefts, or security breaches. Even isolated incidents could result
in negative publicity, lawsuits, regulatory scrutiny, or reputational harm. We
intend to maintain insurance, but coverage may not be sufficient or available
on acceptable terms, and certain risks (e.g., pandemics or acts of God) may be
excluded or subject to high deductibles.
**Our limited operating history and unproven
business model increase the risk that we will not successfully launch or scale
the World Series of Pickleball.**
We
are a new entrant with no track record of organizing or hosting a professional
tournament. Our growth strategy depends on successfully hosting a new event,
building brand recognition, and generating sustainable revenue streams. We may
not achieve market acceptance, manage costs effectively, or respond to
competitive and market changes. These factors make it difficult to evaluate our
prospects and increase the likelihood that we will not achieve or sustain
profitability.
**Risks Related to the Pickleball and Padel Industries in General**
**Our growth strategy involves
planned operations in the pickleball and padel industries.**
Our planned business operations involve court sports, beginning
with planned growth opportunities associated with branding and growing the
pickleball and padel industries, both of which are currently experiencing
significant growth.
Our future success depends, in large part, on our ability to
implement our growth strategies, including expanding our brands product
offerings to capture market share, continuing to engage in consumer acquisition
and retention efforts that drive long-term relationships and continuing to grow
our business. Our ability to implement these growth strategies depends, among
other things, on our ability to:
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Offer
services in the future; |
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increase
our brand recognition; and |
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expand
the geographic reach of our brand. |
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Moreover, our ability to successfully implement our growth
strategies and carry out our plans may be affected by economic and competitive
conditions, changes in consumer spending patterns and changes in consumer
preferences and styles. We may invest in technology, infrastructure, new
businesses, and product offerings, and such significant investments are subject
to typical risks and uncertainties inherent in developing a new business or
expanding an existing business. These plans could be abandoned, could cost more
than anticipated, could impact the quality of our services and could divert
resources from other areas of our business, any of which could negatively
impact our competitive position and reduce our future revenue and/or future
profitability.
**Unfavorable
economic conditions, including as a result of inflation or otherwise, could
have a negative impact on consumer discretionary spending and therefore
negatively impact our future results of operations, financial condition and
cash flows.**
Our offerings are expected to be recreational in nature and will
therefore be discretionary purchases for consumers. Consumers are generally
more willing to make discretionary purchases and to spend on leisure during
favorable economic conditions and when consumers are feeling confident and
prosperous. We expect the future demand for our services will be highly
sensitive to downturns in the economy and the corresponding impact on
discretionary consumer spending. Any actual or perceived deterioration or
weakness in general, regional or local economic conditions, unemployment levels,
the job or housing markets, consumer debt levels or consumer confidence, as
well as other adverse economic or market conditions due to inflation or
otherwise may lead to customers having less discretionary income to spend on
entertainment and recreational activities, and may result in significant
fluctuations and spending patterns year to year. Discretionary spending is also
affected by many other factors, including general business conditions, interest
rates, the availability of consumer credit, taxes and consumer confidence in
future economic conditions. Our future revenues, if any, could decline during
periods when disposable income is lower, or during periods of actual or
perceived unfavorable economic conditions. A significant or prolonged decline
in general economic conditions or uncertainties regarding future economic
prospects that adversely affect consumer discretionary spending, could have a
negative impact on our results of operations, financial condition and cash
flows.
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**Our business could be adversely affected by competition.**
We expect to compete with numerous industry participants.
Competitors may also attempt to copy all or portions of our business model,
products, platform or services, which could erode our market share and brand
recognition or impair our business and results of operations. It is also
possible that competitors could introduce new products and services or new ways
to provide those products and services that negatively impact consumer
preference or willingness to pay for our future products and services. Certain
competitors may have advantages over us including greater name recognition
and/or resources, and non-profit and government organizations may be able to
obtain land and construct facilities at a lower cost and collect membership
fees without paying taxes, thereby allowing them to charge lower prices.
Additionally, consolidation in the industry could result in increased
competition among participants. This competition may limit our ability to
attract and retain members or to optimize our revenue, each of which could
materially and adversely affect our business, results of operations and
financial condition.
**We could be subject to claims related to the construction or
operation of our planned future facilities and the use or condition of our
future planned premises, facilities, equipment, services, activities or
products, which could have a negative effect on our results of operations and
financial condition.**
Use of our future planned premises, facilities, equipment, services,
activities or products pose potential health or safety risks to members and
guests. Claims may be asserted against us for loss, injury or death suffered by
someone (including a minor child) using our future planned premises,
facilities, equipment, services, activities or products. We could also face
claims in connection with the construction of our planned facilities, as well
as claims related to environmental matters or remediation. While we expect to
carry insurance generally applicable to such claims, we will face exposure for
losses within any self-insured retention or for uninsured damages.
We could also face claims for economic or other damages by future
members, guests or employees, including consumer protection, wage and hour, or
other statutory or common law claims arising from our business operations. Such
claims may be uninsured or the proceeds of our insurance coverages for such
claims may be insufficient to cover our losses fully. Depending upon the
outcome, these matters may have a material adverse effect on our business,
results of operations and financial condition.
**We may not be able to maintain the required type or level of
insurance coverage on acceptable terms or at an acceptable cost.**
We may not be able to maintain insurance in the future for our
operations, including general liability and property insurance, on acceptable
terms or maintain a level of insurance that would provide adequate coverage
against potential third-party liability, health and safety and other claims. An
increase in the number of claims against similar companies generally or against
us in particular may cause the cost of insurance for the industry as a whole or
us in particular to rise, and comprehensive insurance coverage may become more
difficult to attain. Any gaps in insurance or any increase in the cost of
insurance may have a material adverse effect on our business, results of
operations and financial condition.
**We may not be able to compete successfully against present or
future competitors.**
We do not have the resources to compete with larger providers of
similar planned services at this time. With the limited resources we have
available, we may experience great difficulties in expanding our operations.
Competition from existing and future competitors could result in our
inability to secure funding to expand our business. This competition from
other entities with greater resources and experience may result in our failure
to maintain or expand our business, as we may never be able to successfully
execute our business plan.
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**Our ability to grow and compete
in the future will be adversely affected if adequate capital is not available.**
The ability of our business to grow and compete depends on the
availability of adequate capital, which in turn depends in large part on the
availability of equity and debt financing. Our cash flow from operations,
if any, in the future may not be sufficient or we may not be able to obtain
equity or debt financing on acceptable terms or at all to implement our growth
strategy. As a result, adequate capital may not be available to finance
our current growth plans, take advantage of business opportunities or respond
to competitive pressures, any of which could harm our business.
**We
have not yet established brand identity and customer loyalty**.
We believe
that establishing and maintaining brand identity and brand loyalty is critical
to attracting and retaining active users to our Platform and App. In order to
attract Platform and App users, we may need to spend substantial funds to
create and maintain brand recognition. If our branding efforts are not
successful, our ability to earn revenues and sustain our operations will be
materially impaired.
Promotion and enhancement of our Platform
and App will also depend on our success in consistently providing high-quality,
ease of use, fun to share products or recommend services to our app users.
Since we expect to rely on technology partners to provide portions of the
service to our customers, if our suppliers do not send accurate and timely
data, or if our customers do not perceive the products we offer as attractive
or superior, the value of our brand could be harmed. Any brand impairment or
dilution could decrease the attractiveness to one or more of these groups,
which could harm our business, results of operations and financial condition.
**If we are unable to manage expected growth in the scale and complexity
of our operations, our performance may suffer.**
If we are successful in executing our business
strategy, we will need to expand our managerial, operational, financial and
other systems and resources to manage our operations, continue our development
activities and, in the longer term, scale a commercial infrastructure to
support our product roll out and end users. Future growth would impose
significant added responsibilities on members of management. It is likely that
our management, finance, sales, and marketing systems and facilities currently
in place, if at all, may not be adequate to support this future growth. Our
need to effectively manage our operations, growth and future product
commercialization requires that we continue to develop more robust business
processes and improve our systems and procedures in each of these areas and to
attract and retain sufficient numbers of talented employees. We may be unable
to successfully implement these tasks on a larger scale and, accordingly, may
not achieve our product development and growth goals.
**Our business depends on a strong brand, and if we are not able to
develop, maintain and enhance our brand, our business and operating results may
be harmed. Moreover, our brand and reputation could be harmed if we were to
experience significant negative publicity.**
****
We believe that developing, maintaining and
enhancing our brand is critical to achieving widespread acceptance of our
platform and products, attracting customers, retaining future customers, and
persuading customers to adopt additional products and use-cases. We believe
that the importance of our brand will increase as competition in our market
further intensifies. Successful promotion of our brand will depend on a number
of factors, including the effectiveness of our marketing efforts, including
thought leadership, our ability to provide a high-quality, reliable and
cost-effective Platform, the perceived value of our Platform and products and
our ability to provide quality customer success and support experience. Brand
promotion activities will require us to make substantial expenditures. To date,
we have made significant investments in the promotion of our brand. The
promotion of our brand, however, may not generate customer awareness or
increase revenue, and any increase in revenue may not offset the expenses we
incur in building and maintaining our brand.
We operate in a public-facing industry in
which every aspect of our business is impacted by social media. Negative
publicity, whether or not justified, can spread rapidly through social media.
To the extent that we are unable to respond timely and appropriately to
negative publicity, our reputation and brand could be harmed. Moreover, even if
we are able to respond in a timely and appropriate manner, we cannot predict
how negative publicity may affect our reputation and business. There is risk
that the use of social media by us to communicate about our business may give
rise to liability or result in public exposure of personal information of our
customers, which could affect our revenue, business, results of operations and
financial condition.
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**Our current or future products
may not achieve or maintain sufficient commercial market acceptance.**
We believe our commercial success
is dependent upon our ability to successfully market and sell subscriptions in
connection with planned Platform and App. Our ability to achieve and maintain
sufficient commercial market acceptance will depend on a number of factors,
including:
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our
ability to increase awareness of our Platform and App, including new product
offerings as they become available; |
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the rate
of adoption of our Platform and App by customers; |
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our
ability to offer new services and products, and maintain and expand customer
engagement; |
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the
impact of our investments in Platform development, innovation and commercial
growth; and |
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public
perception of our products, those of our competitors and the industry in which
we operate, including our ability to avoid adverse publicity from defects or
errors. |
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We may not be successful in
addressing each of these criteria or other criteria that might affect the
market acceptance of our Platform or App. If we are unsuccessful in achieving
and maintaining sufficient market acceptance of our Platform or App, our
business, financial condition and results of operations will suffer.
**Risks Relating to our Management,
and our Reliance on Andre Agassi and our Partners**
**We rely on our management and if
they were to leave our company our business plan could be adversely affected.**
Weare largely dependent
uponthepersonal efforts and abilitiesof ourexisting
management, namely our current Chief Executive Officer, Ronald S. Boreta and
our Chief Financial Officer, Shawn Cable.Moving forward, should the
services of our management be lost for any reason, the Company will incur costs
associated with recruiting replacements and any potential delays in operations
which this may cause. If we are unable to replace such individuals with a
suitably trained alternative individual(s), we may be forced to scale back or
curtail our business plan. While Mr. Boreta is party to an employment agreement
with us, such agreement can be terminated by Mr. Boreta, subject to the terms
thereof.
We do not currently maintain key person life insurance policies on
our executive officers. If our executive officers do not devote sufficient time
towards our business, we may never be able to effectuate our business plan.
**We
rely significantly on Mr. Andre Agassi and the loss of such relationship would
be disruptive to, and could force us to significantly scale back and/or abandon
our business.**
We are currently significantly reliant on Mr. Andre Agassi, our
largest stockholder. We believe that a significant amount of our relationships,
partners, and opportunities, are based on our affiliation with Mr. Agassi, his
ownership of our securities, and his assistance with the operations, business
plan, and prospects of the Company, including relationships of Mr. Agassi in
the tennis and pickleball areas. Mr. Agassi is a well-known public figure, and
is one of the greatest tennis players of all time. Mr. Agassis wife, Stephanie
Graf, is also a brand partner, and is herself one of the greatest tennis
players of all time. We currently have no written agreements with Mr. Agassi
directly regarding the use of his name (including as part of our Company name
and brand name) or likeness, however, Mr. Agassi has informally allowed such
uses to date without compensation. We believe Mr. Agassis assistance has been,
and will continue to be, a critical element of our success. Our ability to
maintain our brand image and leverage the goodwill associated with Mr. Agassis
name would be significantly damaged if our relationship with Mr. Agassi were to
change, in the event of Mr. Agassis death or disability, or in the event of
any negative market or industry perception with respect to him. Additionally,
in the event Mr. Agassi were to stop allowing us the use of his name and
likeness, we may be forced to change our name, brand, and marketing plans and
cease using Mr. Agassi in our advertising and promotional activities which we
expect would have a material adverse effect on our results of operations,
business plans and prospects.
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Furthermore, any negative publicity regarding Mr. Agassi, or other
members of our management team, or our Company as a whole, especially through
social media which accelerates and increases the potential scope of negative
publicity, could adversely impact the image of our brand with our customers and
result in diminished loyalty to our brand and potentially lead to adverse
consumer actions, including boycotts, even if the subject of such publicity is
unverified or inaccurate and we seek to correct it. Consumer sentiment can also
be influenced by our partnership with athletes and other public figures, our
relationships with partners, our views on political and social issues, or our
long-term initiatives and goals regarding our impact on the environment and
society as a whole, among other factors. Even if we react appropriately to
negative publicity, customers perception of our brand image and our reputation
could be negatively impacted. Any failure on our part to retain the value and
reputation of brands could adversely impact our business.
**We
face corporate governance risks and negative perceptions of investors
associated with the fact that we do not currently have any independent
directors.**
Currently, our sole directors are Ronald S. Boreta, our Chief
Executive Officer, and James Askew, a consultant, neither of which are
independent. As such, Mr. Boreta and Mr. Askew can, among other things,
determine their own compensation.Additionally, there are no independent
members of the Board of Directors available to second and/or approve related
party transactions involving Mr. Boreta or Mr. Askew. Therefore, investors may
perceive that because no other directors are approving related party
transactions involving such persons, that such transactions are not fair to the
Company. The price of our common stock may be adversely affected and/or
devalued compared to similarly sized companies with multiple unrelated and
independent officers and directors due to the investing publics perception of
limitations facing our Company due to the above.
**If conflicts arise between us and our strategic partners, our
business could be adversely affected or these parties may act in a manner
adverse to us.**
****
If conflicts arise between our collaborators or strategic partners
and us, the other party may act in a manner adverse to us and could limit our
ability to implement our strategies. Our collaborators or strategic partners
may develop, either alone or with others, products in related fields that are
competitive with our products. Such conflicts with our strategic partners may result
in adverse effects on our business, financial condition and results of
operations.
**Regulatory, Corporate Governance and Reporting Risks**
**We have identified material weaknesses in our disclosure controls
and procedures and internal control over financial reporting.If not
remediated, our failure to establish and maintain effective disclosure controls
and procedures and internal control over financial reporting could result in
material misstatements in our financial statements, and a failure to meet our
reporting and financial obligations.**
Maintaining effective internal control over financial reporting
and effective disclosure controls and procedures are necessary for us to
produce reliable financial statements. As reported underItem 9A.
Controls and Procedures, as of December 31, 2025, our Chief Executive
Officer has determined that our disclosure controls and procedures were not
effective. Separately, as of December 31, 2025, management has identified a
material weakness in our internal control over financial reporting. Specifically
our management determined that, as of December 31, 2025, we did not have
sufficient personnel to allow segregation of duties to ensure the completeness
or accuracy of our information. Due to the size of the Company and its limited
operations, we are unable to remediate this deficiency until we add additional
personnel or acquire or merge with another company. A material weakness is a
deficiency, or a combination of deficiencies, in internal control over
financial reporting, such that there is a reasonable possibility that a
material misstatement of our annual or interim financial statements will not be
prevented or detected on a timely basis.
Maintaining effective disclosure controls and procedures and
effective internal control over financial reporting are necessary for us to
produce reliable financial statements and the Company is committed to
remediating its material weaknesses in such controls as promptly as possible.
However, there can be no assurance as to when these material weaknesses will be
remediated or that additional material weaknesses will not arise in the future.
Any failure to remediate the material weaknesses, or the development of new
material weaknesses in our internal control over financial reporting, could
result in material misstatements in our financial statements and cause us to
fail to meet our reporting and financial obligations, which in turn could have
a material adverse effect on our financial condition and the trading price of
our common stock, and/or result in litigation against us or our management. In
addition, even if we are successful in strengthening our controls and
procedures, those controls and procedures may not be adequate to prevent or
identify irregularities or facilitate the fair presentation of our financial
statements or our periodic reports filed with the SEC.
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**Because we are not subject to compliance with rules requiring the
adoption of certain corporate governance measures, our stockholders have
limited protections against interested director transactions, conflicts of
interest and similar matters.**
The Sarbanes-Oxley Act of 2002, as well as rule changes proposed
and enacted by the SEC, the New York Stock Exchange and The Nasdaq Stock
Market, as a result of Sarbanes-Oxley, require the implementation of various
measures relating to corporate governance. These measures are designed to
enhance the integrity of corporate management and the securities markets and
apply to securities that are listed on those exchanges or The Nasdaq Stock
Market. Because we are not presently required to comply with many of the
corporate governance provisions and because we chose to avoid incurring the
substantial additional costs associated with such compliance any sooner than
legally required, we have not yet adopted these measures.
We do not currently have an independent audit or compensation
committee. Until we comply with such corporate governance measures, regardless
of whether such compliance is required, the absence of such standards of
corporate governance may leave our stockholders without protections against
interested director transactions, conflicts of interest, if any, and similar
matters and any potential investors may be reluctant to provide us with funds
necessary to expand our operations.
We intend to comply with all corporate governance measures
relating to director independence as and when required. However, we may find it
very difficult or be unable to attract and retain qualified officers, directors
and members of board committees required to provide for our effective
management as a result of the Sarbanes-Oxley Act of 2002. The enactment of the
Sarbanes-Oxley Act of 2002 has resulted in a series of rules and regulations by
the SEC that increase responsibilities and liabilities of directors and
executive officers. The perceived increased personal risk associated with these
recent changes may make it more costly or deter qualified individuals from
accepting these roles.
**Changing regulations and increased awareness
relating to privacy, information security and data protection could increase
our costs, affect or limit how we collect and use personal information and harm
our brand.**
****
We expect to receive, store and otherwise
process personal information and other data from and about our customers. There
are numerous federal, state, local and international laws and regulations
regarding privacy, data protection, information security and the storing,
sharing, use, processing, transfer, disclosure, retention and protection of
personal information and other content, the scope of which is rapidly changing,
subject to differing interpretations and may be inconsistent among countries
and states, or conflict with other rules. We are also subject to the terms of
our privacy policies and contractual obligations to third parties related to
privacy, data protection and information security. We strive to comply with
applicable laws, regulations, policies and other legal obligations relating to
privacy, data protection and information security. However, the regulatory
framework for privacy, data protection and information security worldwide is,
and is likely to remain, uncertain for the foreseeable future, and it is
possible that these or other actual or alleged obligations may be interpreted
and applied in a manner that is inconsistent from one jurisdiction to another
and may conflict with other rules or our practices.
We also expect that there will continue to be
new laws, regulations and industry standards concerning privacy, data
protection and information security proposed and enacted in various
jurisdictions. The United States, the European Union (EU), and other
countries in which we may operate in the future are increasingly adopting or
revising privacy, information security and data protection laws and regulations
that could have a significant impact on our current and planned privacy, data
protection and information security-related practices, our collection, use, sharing,
retention and safeguarding of customer, consumer and/or employee information,
as well as any other third-party information we receive, and some of our
current or planned business activities. New and changing laws, regulations, and
industry standards concerning privacy, data protection and information security
may also impact the social media platforms and data providers we utilize, and
thereby indirectly impact our business. In the United States, this includes
increased privacy-related regulations and enforcement activity at both the
federal level and state levels that impose requirements on the personal
information we collect in the course of our business activities. In the EU,
this includes the General Data Protection Regulation (GDPR).
Additionally, several U.S. States have adopted their own privacy laws. The
potential effects of these legislations are far-reaching and may require us to
modify our data processing practices and policies and to incur substantial
costs and expenses in an effort to comply.
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With various laws and regulations imposing
new and relatively burdensome obligations, and with substantial uncertainty
over the interpretation and application of these and other laws and
regulations, we may face challenges in addressing their requirements and making
necessary changes to our policies and practices, and may incur significant
costs and expenses in an effort to do so. In addition, any failure or perceived
failure by us to comply with our privacy policies, our privacy, data protection
or information security-related obligations to customers, users or other third
parties or any of our other legal obligations relating to privacy, data
protection or information security may result in governmental investigations or
enforcement actions, litigation, claims or public statements against us by
consumer advocacy groups or others, and could result in significant liability,
loss of relationships with key third parties including social media networks
and other data providers, or cause our users to lose trust in us, which could
have an adverse effect on our reputation and business. Furthermore, the costs
of compliance with, and other burdens imposed by, the laws, regulations and
policies that are applicable to the businesses of our users may limit the adoption
and use of, and reduce the overall demand for, our platform.
Additionally, if the third parties we work
with, such as vendors or developers, violate applicable laws or regulations or
our policies, such violations may also put our users content at risk and could
in turn have an adverse effect on our business. Any significant change to
applicable laws, regulations or industry practices regarding the collection,
use, retention, security or disclosure of such content, or regarding the manner
in which the express or implied consent of such persons for the collection,
use, retention or disclosure of such content is obtained, could increase our
costs and require us to modify our future services and features, possibly in a
material manner, which we may be unable to complete and may limit our ability
to store and process user data or develop new services and features. All of
these implications could adversely affect our revenue, results of operations,
business and financial condition.
**Risks Relating to our Intellectual
Property**
**We may
be unable to protect our intellectual property rights from unauthorized use by
third parties.**
****
Our success will depend, in part, on our ability to protect our
proprietary intellectual property rights. To date, we have relied primarily on
non-disclosure agreements to protect our proprietary information and we
routinely enter intonon-disclosure agreements with our consultants, third
parties and other relevant persons and take other measures to protect our
intellectual property rights, such as limiting access to our trade secrets and
other confidential information. We intend to continue to rely on these and
other means, including patent protection, in the future. However, the steps we
take to protect our intellectual property may be inadequate, and unauthorized
parties may attempt to copy aspects of our intellectual property or obtain and
use information that we regard as proprietary and, if successful, may
potentially harm our ability to compete, accelerate the development programs of
our competitors, and/or result in a deteriorated competitive position in the
market. Moreover, ournon-disclosure agreements do not prevent our
competitors from independently developing technologies that are substantially
equivalent or superior to ours, and there can be no assurance that our
competitors or third parties will comply with the terms of these agreements, or
that we will be able to successfully enforce such agreements or obtain
sufficient remedies if they are breached. There can be no assurance that the
intellectual property rights we own or license will provide competitive
advantages or will not be challenged or circumvented by our competitors.
Further, obtaining and maintaining patent, copyright, and
trademark protection can be costly, and we may choose not to, or may fail to,
pursue or maintain such forms of protection for our technology in the United
States or foreign jurisdictions, which could harm us. The laws of some
countries do not protect proprietary rights to the same extent as the laws of
the United States, and mechanisms for enforcement of intellectual property
rights in some foreign countries may be inadequate to prevent other parties
from infringing our proprietary technology. To the extent we expand our
international activities, our exposure to unauthorized use of our technologies
and proprietary information may increase. We may also fail to detect
unauthorized use of our intellectual property, or be required to expend
significant resources to monitor and protect our intellectual property rights,
including engaging in litigation, which may be
costly,time-consuming,and divert the attention of management and
resources, and may not ultimately be successful. If we fail to meaningfully
establish, maintain, protect and enforce our intellectual property rights, our
business, financial condition and results of operations could be adversely
affected.
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**Our trademarks and other intellectual property rights may not be
adequately protected outside the U.S.**
We believe that our trademarks, intellectual property, and other
proprietary rights will be extremely important to our success and our
competitive position. However, the laws of certain foreign countries may not
protect trademarks or other proprietary rights to the same extent as do the
laws of the U.S. and, as a result, our intellectual property may be more
vulnerable and difficult to protect in such countries.
**Risks Relating to Our Common
Stock**
**We currently have an illiquid and volatile market for our common
stock, and the market for our common stock is and may remain illiquid and
volatile in the future.**
We currently have a highly sporadic, illiquid and volatile market
for our common stock, which market is anticipated to remain sporadic, illiquid
and volatile in the future. During the last 52 weeks our common stock has
traded as high as $8.40 per share and as low as $2.60 per share. The market
price of our common stock may continue to be highly volatile and subject to
wide fluctuations. Our financial performance, government regulatory action, tax
laws, interest rates, and market conditions in general could have a significant
impact on the future market price of our common stock. The trading price of our
common stock could also be affected by:
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short
squeezes; |
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comments
by securities analysts or other third parties, including blogs, articles,
message boards and social and other media; |
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large
stockholders exiting their position in our securities or an increase or
decrease in the short interest in our securities; |
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actual
or anticipated fluctuations in our financial and operating results; |
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the
recruitment or departure of key personnel; |
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actual
or anticipated changes in estimates as to financial results, operational
timelines or recommendations by securities analysts; |
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the
timing and outcome of our business plan; |
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significant
lawsuits or stockholder litigation; |
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variations
in our financial results or those of companies that are perceived to be
similar to us; |
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market
conditions in the court sports industry; |
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general
economic, political, and market conditions and overall fluctuations in the
financial markets in the U.S. and abroad; and |
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investors
general perception of us and our business. |
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Our common stock is quoted on the OTCID under the symbol AASP.
Our stock price may be impacted by factors that are unrelated or
disproportionate to our operating performance. The stock markets in general
have experienced extreme volatility that has often been unrelated to the
operating performance of particular companies. These broad market fluctuations
may adversely affect the trading price of our common stock. Additionally,
general economic, political and market conditions, such as recessions,
inflation, war, interest rates or international currency fluctuations may
adversely affect the market price of our common stock. Due to the limited
volume of our shares which trade, we believe that our stock prices (bid, ask
and closing prices)may not be related to our actual value, and not reflect
the actual value of our common stock. You should exercise caution before making
an investment in us.
Stock markets in general and our stock price in particular have
recently experienced extreme price and volume fluctuations that have often been
unrelated or disproportionate to the operating performance of those companies
and our company. Broad market fluctuations may adversely affect the trading
price of our securities. Additionally, these and other external factors have
caused and may continue to cause the market price and demand for our common
stock to fluctuate substantially, which may limit or prevent our stockholders
from readily selling their shares of our common stock and may otherwise
negatively affect the liquidity of our common stock.
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Additionally, as a result of the illiquidity of our common stock,
investors may not be interested in owning our common stock because of the
inability to acquire or sell a substantial block of our common stock at one
time. Such illiquidity could have an adverse effect on the market price of our
common stock. In addition, a shareholder may not be able to borrow funds using
our common stock as collateral because lenders may be unwilling to accept the
pledge of securities having such a limited market. An active trading market for
our common stock may not develop or, if one develops, may not be sustained.
In the past, many companies that have experienced volatility in
the market price of their stock have been subject to securities class action
litigation. We may be the target of this type of litigation in the future.
Securities litigation against us could result in substantial costs and divert
our managements attention from other business concerns, which could seriously
harm our business.
**Our Securities are not currently eligible for sale under Rule 144
and any future sales of our securities may be adversely affected by our failure
to file all reports required by the Exchange Act.**
Rule 144 as promulgated under the Securities Act is not available
for the resale of securities initially issued by a shell company (reporting or
non-reporting) or a former shell company, unless certain conditions are
satisfied. We are a former shell company. As a result, our securities cannot be
resold under Rule 144 unless certain conditions are met. These conditions are:
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the
issuer of the securities has ceased to be a shell company (we ceased to be a
shell company on May 31, 2025); |
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the
issuer is subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act (we are currently subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act); |
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the
issuer has filed all reports and other materials required to be filed by
Section 13 or 15(d) of the Exchange Act, as applicable, during the preceding
12 months, other than Form 8-K reports (we have filed all reports and other
materials required to be filed by Section 13 or 15(d) of the Exchange Act, as
applicable, during the preceding 12 months); and |
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one
year has elapsed since the issuer has filed current Form 10 information
with the Commission reflecting its status as an entity that is no longer a
shell company (we filed Form 10 information with the Commission reflecting
our status as a non-shell company on June 4, 2025. |
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As discussed above, our Current Report on Form 8-K filed with the
SEC on June 4, 2025 contained Form 10 information reflecting our status as an
entity that is no longer a shell company, but one year must elapse from the
filing date of that Current Report in order for our securities to be eligible
for sale under Rule 144, provided the other conditions set forth above and in
Rule 144 are satisfied. No assurance can be provided that we will be compliant
with these conditions. If after one year has elapsed from the filing date of
the Current Report we, as a former shell company, ever fail to file all reports
and other materials required to be filed by Section 13 or 15 (d) of the
Exchange Act, as applicable, during the preceding 12 months, our securities
will not be eligible to be resold under Rule 144. As a result, it may be harder
for us to fund our operations and pay our consultants with our securities
instead of cash. Furthermore, it may be harder for us to raise funding
through the sale of debt or equity securities unless we agree to register such
securities with the Commission, which could cause us to expend additional
resources in the future. Additionally, moving forward, our status as a
former shell company could prevent us from raising additional funds, engaging
consultants, and using our securities to pay for any acquisitions (although
none are currently planned), which could cause the value of our securities, if
any, to decline in value or become worthless.
Assuming we continue to meet the former shell company requirements
of Rule 144 as discussed above, and following the one year anniversary of the
date we have filed Form 10 information with the SEC, in general any restricted
shares of common stock we issue or sell in the future will be eligible for sale
pursuant to Rule 144 six months after issuance and payment in full for such
shares, to the extent we continue to file periodic reports under the Exchange
Act.
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**The exercise of our outstanding warrants, and the sale of common
stock upon exercise thereof, may adversely affect the trading price of our
securities.**
****
As of the date of this Report, we
have outstanding warrants to purchase 850,000 shares of common stock with an
exercise price of $1.70 per share, which expire on March 6, 2030; warrants to
purchase 50,000 shares of common stock with an exercise price of $5.75;
warrants to purchase 50,000 shares of common stock with an exercise price of
$6.30 per share and an expiration date of July 31, 2028; warrants
to purchase 1,000,000 shares of common stock with an exercise price of $5.50
per share and an expiration date of November 22, 2030; and warrants to
purchase 200,000 shares of common stock with an exercise price of $5.00 and an
expiration date of February 3, 2029, certain of which have
cashless exercise rights. For the life of the warrants, the holders have the
opportunity to profit from a rise in the market price of our common stock
without assuming the risk of ownership. The issuance of shares upon the
exercise of outstanding securities will also dilute the ownership interests of
our existing stockholders.
The availability of these shares for public resale, as well as any
actual resales of these shares, could adversely affect the trading price of our
common stock. We cannot predict the size of future issuances of our common
stock pursuant to the exercise of outstanding warrants, or the effect, if any,
that future issuances and sales of shares of our common stock may have on the
market price of our common stock. Sales or distributions of substantial amounts
of our common stock (including shares issued in connection with an
acquisition), or the perception that such sales could occur, may cause the
market price of our common stock to decline.
In addition, the common stock issuable upon exercise of the
warrants may represent overhang that may also adversely affect the market price
of our common stock. Overhang occurs when there is a greater supply of a
companys stock in the market than there is demand for that stock. When this
happens the price of our stock will decrease, and any additional shares which
stockholders attempt to sell in the market will only further decrease the share
price. If the share volume of our common stock cannot absorb shares sold by
holders of our Warrants, then the value of our common stock will likely
decrease.
Because the warrants may also be exercised by way of a cashless
exercise, meaning that the holders may not pay a cash purchase price upon
exercise, but instead would receive upon such exercise the net number of shares
of our common stock determined according to the formula set forth in the
warrants, we may not receive any funds upon the exercise of the warrants.
****
**Our officers and directors beneficially own 46.7% of our
outstanding common stock and exercise significant voting control over us, and
together with Mr. Andre Agassi, hold majority voting control over the Company,
which will limit your ability to influence corporate matters and could delay or
prevent a change in corporate control.**
Our officers and directors currently own approximately 46.7% of
the issued and outstanding shares of our common stock and our officers and
directors and Mr. Andre Agassi, a consultant to the Company, beneficially own
over a majority of our outstanding common stock. As a result, such persons
control the shareholder vote. As a result, they have the ability to influence
matters affecting our shareholders and will therefore exercise control in
determining the outcome of all corporate transactions or other matters,
including (i) making amendments to our Articles of Incorporation; (ii) whether
to issue additional shares of common stock and preferred stock, including to
themselves; (iii) employment decisions, including compensation arrangements;
(iv) whether to enter into material transactions with related parties; (v)
election of directors; and (vi) any merger or significant corporate transactions,
including with themselves or other related parties. Additionally, it will be
difficult if not impossible for investors to remove our current directors,
which will mean they will remain in control of who serves as officers of the
Company as well as whether any changes are made in the Board of Directors. As a
potential investor in the Company, you should keep in mind that even if you own
shares of our common stock and wish to vote them at annual or special
shareholder meetings, your shares will likely have little effect on the outcome
of corporate decisions. The interests of our officers and directors and Mr.
Agassi may not coincide with our interests or the interests of other
shareholders.
In addition, this concentration of ownership might adversely
affect the market price of our common stock by: (1) delaying, deferring or
preventing a change of control of our Company; (2) impeding a merger,
consolidation, takeover or other business combination involving our Company; or
(3) discouraging a potential acquirer from making a tender offer or otherwise
attempting to obtain control of our Company.
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**Stockholders may be diluted significantly through our efforts to
obtain financing and satisfy obligations through the issuance of additional
shares of our common stock.**
We have no committed source of financing. Wherever possible, our
Board of Directors will attempt to use non-cash consideration to satisfy
obligations. In many instances, we believe that the non-cash consideration will
consist of restricted shares of our common stock. Our Board of Directors has
authority, without action or vote of the stockholders, to issue all or part of
the authorized but unissued shares of common stock. In addition, if a trading
market develops for our common stock, we may attempt to raise capital by
selling shares of our common stock, possibly at a discount to market. These
actions will result in dilution of the ownership interests of existing
stockholders, may further dilute common stock book value, and that dilution may
be material. Such issuances may also serve to enhance existing managements
ability to maintain control of the Company because the shares may be issued to
parties or entities committed to supporting existing management.
****
**We have not paid any cash dividends in the past and have no plans
to issue cash dividends in the future, which could cause the value of our
common stock to have a lower value than other similar companies which do pay
cash dividends.**
We have not paid any cash dividends on our common stock to date
and do not anticipate any cash dividends being paid to holders of our common
stock in the foreseeable future. While our dividend policy will be based on the
operating results and capital needs of the business, it is anticipated that any
earnings will be retained to finance our future expansion. As we have no plans
to issue cash dividends in the future, our common stock could be less desirable
to other investors and as a result, the value of our common stock may decline,
or fail to reach the valuations of other similarly situated companies who have
historically paid cash dividends in the past.
**Our common stock is considered a penny stock under SEC rules and
it may be more difficult to resell securities classified as a penny stock.**
Our common stock is a penny stock under applicable SEC rules
(generally defined as non-exchange traded stock with a per-share price below
$5.00). Unless we maintain a per-share price above $5.00 (or obtain a listing
on a national securities exchange), our common stock will continue to be a
penny stock. These rules impose additional sales practice requirements on
broker-dealers that recommend the purchase or sale of penny stocks to persons
other than those who qualify as established customers or accredited
investors. For example, broker-dealers must determine the appropriateness for
non-qualifying persons of investments in penny stocks. Broker-dealers must also
provide, prior to a transaction in a penny stock not otherwise exempt from the
rules, a standardized risk disclosure document that provides information about
penny stocks and the risks in the penny stock market. The broker-dealer also
must provide the customer with current bid and offer quotations for the penny
stock, disclose the compensation of the broker-dealer and its salesperson in
the transaction, furnish monthly account statements showing the market value of
each penny stock held in the customers account, provide a special written
determination that the penny stock is a suitable investment for the purchaser,
and receive the purchasers written agreement to the transaction.
Legal remedies available to an investor in penny stocks may
include the following:
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If a penny stock is sold to the investor
in violation of the requirements listed above, or other Federal or states
securities laws, the investor may be able to cancel the purchase and receive
a refund of the investment. |
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If a penny stock is sold to the investor
in a fraudulent manner, the investor may be able to sue the persons and firms
that committed the fraud for damages. |
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These requirements may have the effect of reducing the level of
trading activity, if any, in the secondary market for a security that becomes
subject to the penny stock rules. The additional burdens imposed upon
broker-dealers by such requirements may discourage broker-dealers from
effecting transactions in our securities, which could severely limit the market
price and liquidity of our securities. These requirements may restrict the
ability of broker-dealers to sell our common stock and may affect your ability
to resell our common stock.
Many brokerage firms will discourage or refrain from recommending
investments in penny stocks. Most institutional investors will not invest in
penny stocks. In addition, many individual investors will not invest in penny
stocks due to, among other reasons, the increased financial risk generally
associated with these investments.
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For these reasons, penny stocks may have a limited market and,
consequently, limited liquidity. We can give no assurance at what time, if
ever, our common stock will not be classified as a penny stock in the future.
**General risk factors****:**
****
**Our ability to grow and compete
in the future will be adversely affected if adequate capital is not available.**
The ability of our business to grow and compete depends on the
availability of adequate capital, which in turn depends in large part on our
cash flow from operations and the availability of equity and debt financing.
Our cash flow from operations may not be sufficient or we may not be able to
obtain equity or debt financing on acceptable terms or at all to implement our
growth strategy. As a result, adequate capital may not be available to finance
our current growth plans, take advantage of business opportunities or respond
to competitive pressures, any of which could harm our business.
**If we are unable to manage future growth effectively, our
profitability and liquidity could be adversely affected.**
Our ability to achieve our desired growth depends on our execution
in functional areas such as management, sales and marketing, finance and
general administration and operations. To manage any future growth, we must
continue to improve our operational and financial processes and systems and
expand, train and manage our employee base and control associated costs. Our
efforts to grow our business, both in terms of size and in diversity of
customer bases served, will require rapid expansion in certain functional areas
and put a significant strain on our resources. We may incur significant
expenses as we attempt to scale our resources and make investments in our
business that we believe are necessary to achieve long-term growth goals. If we
are unable to manage our growth effectively, our expenses could increase
without a proportionate increase in revenue, our margins could decrease, and
our business and results of operations could be adversely affected.
****
**If we
make any acquisitions, they may disrupt or have a negative impact on our business.**
If we make acquisitions in the future, funding permitting, which
may not be available on favorable terms, if at all, we could have difficulty
integrating the acquired companys assets, personnel and operations with our
own. We do not anticipate that any acquisitions or mergers we may enter into in
the future would result in a change of control of the Company. In addition, the
key personnel of the acquired business may not be willing to work for us. We
cannot predict the effect expansion may have on our core business. Regardless
of whether we are successful in making an acquisition, the negotiations could
disrupt our ongoing business, distract our management and employees and
increase our expenses. In addition to the risks described above, acquisitions
are accompanied by a number of inherent risks, including, without limitation,
the following:
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the difficulty of integrating acquired
products, services or operations; |
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the potential disruption of the ongoing
businesses and distraction of our management and the management of acquired
companies; |
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difficulties in maintaining uniform
standards, controls, procedures and policies; |
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the potential impairment of relationships
with employees and customers as a result of any integration of new management
personnel; |
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the potential inability or failure to
achieve additional sales and enhance our customer base through
cross-marketing of the products to new and existing customers; |
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the effect of any government regulations
which relate to the business acquired; |
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potential unknown liabilities associated
with acquired businesses or product lines, or the need to spend significant
amounts to retool, reposition or modify the marketing and sales of acquired
products or operations, or the defense of any litigation, whether or not
successful, resulting from actions of the acquired company prior to our
acquisition; and |
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potential expenses under the labor,
environmental and other laws of various jurisdictions. |
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33 |
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Our business could be severely impaired if and to the extent that
we are unable to succeed in addressing any of these risks or other problems
encountered in connection with an acquisition, many of which cannot be
presently identified. These risks and problems could disrupt our ongoing
business, distract our management and employees, increase our expenses, and
adversely affect our results of operations.
**We incur ongoing costs and expenses for SEC reporting and
compliance and without sufficient revenues, we may not be able to remain in
compliance, making it difficult for investors to sell their shares, if at all.**
In order for us to remain in compliance with our on-going
reporting requirements, we may require additional capital and/or future
revenues to cover the cost of these filings, which could comprise a substantial
portion of our available cash resources or require us to obtain additional
capital through the sale of equity or debt. If we are unable to further
capitalize the Company or generate sufficient revenues to remain in compliance,
it may be difficult for you to resell any shares you may purchase, if at all.
There are ongoing costs and expenses for SEC reporting, including the general
booking and accounting costs for the preparation of the financial quarterly
(Form 10-Qs) and annual filings (Form 10-Ks), and auditors fees. Further,
there are processing costs in preparing and converting documents and
disclosures through the EDGAR filing system, including certain costs for the
XBRL that are required as part of the EDGAR filing.
**We may
experience adverse impacts on our reported results of operations as a result of
adopting new accounting standards or interpretations.**
Our implementation of and compliance with changes in accounting
rules, including new accounting rules and interpretations, could adversely
affect our reported financial position or operating results or cause
unanticipated fluctuations in our reported operating results in future periods.
**If persons engage in short sales ofour common stock, the
price of our common stock may decline.**
Selling short is a technique used by a stockholder to take
advantage of an anticipated decline in the price of a security. In addition,
holders of options and warrants will sometimes sell short knowing they can, in
effect, cover through the exercise of an option or warrant, thus locking in a
profit. A significant number of short sales or a large volume of other sales
within a relatively short period of time can create downward pressure on the
market price of a security. Stockholders could, therefore, experience a decline
in the value of their investment as a result of short sales of our common
stock.
**Global economic conditions could materially adversely affect our
business, results of operations, financial condition and growth.**
Adverse macroeconomic conditions, including inflation, slower
growth or recession, new or increased tariffs, changes to fiscal and monetary
policy, tighter credit, higher interest rates, high unemployment and currency
fluctuations could materially adversely affect our operations, expenses, and
access to capital. In addition, uncertainty about, or a decline in, global or
regional economic conditions could have a significant impact on our expected
funding sources and partners. A downturn in the economic environment could also
lead to limitations on our ability to issue new debt; and reduced liquidity.
These and other economic factors could materially adversely affect our
business, results of operations, financial condition and growth.
**We may be adversely affected by climate change or by legal,
regulatory or market responses to such change.**
The long-term effects of climate change are difficult to predict;
however, such effects may be widespread. Impacts from climate change may
include physical risks (such as rising sea levels or frequency and severity of
extreme weather conditions), social and human effects (such as population
dislocations or harm to health and well-being), compliance costs and transition
risks (such as regulatory or technology changes) and other adverse effects. The
effects of climate change could increase the cost of certain products,
commodities and energy (including utilities), which in turn may
impact our ability to undertake
our business plan and costs and expenses. Climate change could also lead to increased costs as a result of
physical damage to or destruction of our facilities, equipment and business
interruption due to weather events that may be attributable to climate change.
These events and impacts could materially adversely affect our business
operations, financial position or results of operation.
**We might be adversely impacted by changes in accounting standards.**
Our consolidated financial statements are subject to the
application of GAAP, which periodically is revised or reinterpreted. From time
to time, we are required to adopt new or revised accounting standards issued by
recognized authoritative bodies, including the Financial Accounting Standards
Board and the SEC. It is possible that future accounting standards may require
changes to the accounting treatment in our consolidated financial statements
and may require us to make significant changes to our financial systems. Such
changes might have a materially adverse impact on our financial position or
results of operations.
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**ITEM
1B. UNRESOLVED STAFF COMMENTS**
None.
**ITEM 1C. CYBERSECURITY**
*Risk Management and Strategy*
The Company understands the
importance of preventing, assessing, identifying, and managing material risks
associated with cybersecurity threats. Cybersecurity processes to assess, identify
and manage risks from cybersecurity threats have been incorporated as a part of
the Companys overall risk assessment process. These risks include, among other
things: operational risks, intellectual property theft, fraud, extortion, harm
to employees (of which we currently have none) or customers (of which we
currently have none) and violation of data privacy or security laws.
The Company's cybersecurity
environment is led by its Chief Executive
Officer, who in addition
to cybersecuritymatters, oversees the
Company's IT infrastructure
and is responsible for monitoring and managing the security of the Company's
corporate network and enterprise systems, including technical controls, and
safety protocols and responding to security threats. Our Chief Executive
Officer reports to the Board of Directors, and the
full Board of Directors is
responsible for oversight of risks from cybersecurity threats.
We describe whether and how risks
from identified cybersecurity threats, including as a result of any previous
cybersecurity incidents, have materially affected or are reasonably likely to
materially affect us, including our business strategy, results of operations,
or financial condition, under the heading *If we or our third-party service
providers experience a security breach, or if unauthorized parties otherwise
obtain access to our customers data, our reputation may be harmed, demand for
services may be reduced, and we may incur significant liabilities*,
included as part of our risk factor disclosures at Item 1A of this Annual
Report on Form 10-K.
Cybersecurity is an important
part of our risk management processes and an area of focus for our Board and
management. TheCompany establishes safeguards for protecting the
confidentiality, integrity, and availability of our data, technology, and
information systems.
As of and for the year
endedDecember 31, 2025, there have been nocybersecurity incidents
that have materially affected the Companys business strategy, results of
operations, or financial condition.
**ITEM
2. PROPERTIES**
The Companys corporate offices are located at
1120 N Town Center Drive, Suite 160, Las Vegas, Nevada 89144 in space shared
with Agassi Graf Holdings, which is affiliated with Andre Agassi, our largest
shareholder, which is provided to the Company without charge.
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We believe that our current facilities are
suitable and adequate to meet our current needs, and that suitable additional
or substitute space will be available as needed.
**ITEM 3.
LEGAL PROCEEDINGS**
Although we
may, from time to time, be involved in litigation and claims arising out of our
operations in the normal course of business, we are not currently a party to
any material legal proceeding. In addition, we are not aware of any material
legal or governmental proceedings against us or contemplated to be brought
against us.****
**ITEM 4.
MINE SAFETY DISCLOSURES.**
This item
is not applicable to the Company.
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**PART II**
**ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY,
RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES**
**Market for Common Stock**
Our common stock is quoted on the
OTCID maintained by OTC Markets under the symbol AASP.
The following table sets forth
the range of high and low sales prices for our common stock for each of the
periods indicated as reported by the OTCID. These quotations reflect
inter-dealer prices, without retail mark-up, mark-down or commission and may
not necessarily represent actual transactions. Due to the fact that trading in
our common stock is extremely sporadic, with multiple trading days where no
trading occurs, and limited, with many trading days trading less than 3,000
shares of common stock, we believe the high and low sales prices below should
not be relied upon as a basis for determining the value of our common stock.
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12 Month Period EndedDecember31, 2025 |
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Low |
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Quarter ended December 31, 2025 |
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$ |
6.290 |
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$ |
3.750 |
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Quarter ended September 30, 2025 |
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8.400 |
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3.700 |
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Quarter ended June 30, 2025 |
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7.500 |
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3.500 |
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Quarter ended March 31, 2025 |
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4.000 |
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1.670 |
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12 Month Period EndedDecember31, 2024 |
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High |
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Low |
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Quarter ended December 31, 2024 |
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$ |
4.000 |
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$ |
0.710 |
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Quarter ended September 30, 2024 |
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1.820 |
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0.173 |
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Quarter ended June 30, 2024 |
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0.405 |
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0.172 |
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Quarter ended March 31, 2024 |
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0.510 |
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0.211 |
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**Holders**
The number of holders of
record of the Companys $0.001 par value common stock as of March 31, 2026 was
approximately 550. This does not include shareholders who hold stock in their
accounts at broker/dealers.
**Dividends**
Holders of common stock are
entitled to receive such dividends as may be declared by the Companys Board of
Directors. No dividends have been paid with respect to the Companys common
stock and no dividends are expected to be paid in the foreseeable future. It is
the present policy of the Board of Directors to retain all earnings to provide
for the growth of the Company. Payment of cash dividends in the future will
depend, among other things, upon the Companys future earnings, requirements
for capital improvements and financial condition.
**Recent Sales of Unregistered
Securities.**
There have been no sales of unregistered
securities during the quarter ended December 31, 2025, and from the period from January 1, 2026 to the filing date of this Report which
have not previously been disclosed in a Current Report on Form 8-K or Quarterly Report on Form 10-Q, except as discussed below:
On February 6, 2026, the Company
issued an aggregate of 19,223 shares of common stock of the Company to an individual upon the conversion (effective December 31, 2024),
of all principal and interest due under a $7,500 convertible promissory note dated September 30, 2024, held by the individual as of December
31, 2024, and pursuant to the conversion rights set forth in such convertible promissory note, including a conversion price of $0.40 per
share.
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We claim an exemption from registration
provided by Section 3(a)(9) of the Securities Act for the conversion of the convertible note and the issuance of the conversion shares,
as the securities were exchanged by us with our existing security holder in a transaction where no commission or other remuneration was
paid or given directly or indirectly for soliciting such exchange.
****
**Purchases of Equity Securities by the Issuer and Affiliated
Purchasers**
None.
**ITEM 6. [RESERVED]**
**ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.**
The
following discussion of the Companys historical performance and financial
condition should be read together with the consolidated financial statements
and related notes in Item 8. Financial Statements and Supplemental Data of
this Report. This discussion contains forward-looking statements based on the
views and beliefs of our management, as well as assumptions and estimates made
by our management, see Cautionary Statement Regarding Forward-Looking
Information. These statements by their nature are subject to risks and
uncertainties, and are influenced by various factors. As a consequence, actual
results may differ materially from those in the forward-looking statements. See
Item 1A. Risk Factors of this report for the discussion of risk factors.
***Summary of The Information Contained
in Managements Discussion and Analysis of Financial Condition and Results of
Operations***
Our Managements Discussion and
Analysis of Financial Condition and Results of Operations
(MD&A) is provided in addition to the accompanying consolidated financial
statements and notes to assist readers in understanding our results of
operations, financial condition, and cash flows. MD&A is organized as
follows:
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Plan of Operations.A description of
our plan of operations for the next 12 months including required funding. |
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Results of Operations. An analysis of our financial results
comparing the years ended December 31, 2025 and 2024. |
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Liquidity and Capital Resources. An analysis of changes in our
consolidated balance sheets and cash flows and discussion of our financial
condition. |
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Critical Accounting Policies and Estimates. Accounting estimates that we believe are
important to understanding the assumptions and judgments incorporated in our
reported financial results and forecasts. |
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**Plan of Operations**
We
had a working capital surplus
of $1,975 as of December 31, 2025. We expect to require funding in the future,
including to complete payments due under our agreements with the IBM Parties,
which require us to make payments to the IBM Parties under the Services
Agreement and SoW 1 totaling approximately $2.1 million, payable in monthly
installments in accordance with the terms of SoW 1, including $100,000 within
15 days after invoice from IBM, for each of November and December 2025, and
January and February 2026, with $204,387 due before February 28, 2026 and
$613,161 before March 20, 2026, and $229,292 due for each of March through June
2026, as discussed above. To date,
$454,387 has been paid.
We
plan on raising additional required funding through the sale of equityin the
future, which is expected to be on similar terms as our recent
$650,000 raised through the
sale of common stock in March 2026.We anticipate that this capital
will be sufficient to make all monthly payments to the IBM Parties under the
Services Agreement.
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We also hope to
begin generating revenues in April
2026
from our Agassi Intelligence software, website and future expected sponsorship
relations.
Notwithstanding
the above, we may sell
additional equity
in the future, which may not be available on favorable terms, if
at all, and may, if sold, cause significant dilution to existing stockholders.
If we are unable to access additional capital moving forward, it may hurt our
ability to grow and to generate revenues.
**Results of Operations**
**Results of Operations for the year
ended December 31, 2025 Compared to the year ended December 31, 2024.**
We generated no revenues for the years
ended December 31, 2025 or 2024.
For the year ended December 31,
2025 and 2024, general and administrative expenses, consisting of stock- based
compensation, salaries, legal fees, audit fees and miscellaneous administrative
costs that totaled $9,491,534 and $793,749, respectively, an increase of $8,697,785
from the prior year, which increase was mainly due to $7,232,145 in stock-based
compensation in connection with fair value of warrants issued during the year
ended December 31, 2025. In addition, $260,668 in salary and bonus was paid to Ronald
S. Boreta, our Chief Executive Officer, in 2025.
We also brought on our CFO, Shawn Cable, and he
was paid $66,858 in 2025. Legal fees totaling $201,237 were paid to two
separate firms we have retained
for assistance with our business
agreements, SEC filings
and general
legal matters.
Professional fees totaling $1,098,653 were paid in 2025, which includes $275,00
paid to IBM and $300,380 paid to certain
consultants for
consulting services rendered. For the year ended December 31,
2024, $619,867 in stock-based compensation was incurred in connection with fair
value of warrants issued during the year ended December 31, 2024 and $40,000 in
salary was paid to Ronald S. Boreta in consideration for services rendered as
our Chief Executive Officer. Legal fees totaling approximately $64,000 were
also paid in 2024.
Total operating expenses
increased mainly due to the increase in salary paid to Ronald S. Boreta, our
Chief Executive Officer, increased legal and professional fees, and the
increase in warrant expense, as discussed above.
We had interest expense of $994
for the year ended December 31, 2025, compared to $0 for the year ended
December 31, 2024, which was in connection with interest payable
under a convertible promissory note issued in September 2024 and converted into
common stock in December 2024, which issuance was affected in February 2026.
We had a net loss of $9,491,534
and $793,749, for the years ended December 31, 2025, and 2024, respectively,
which net loss increased for the reason described above.
**Liquidity and Capital Resources**
The following table summarizes
our current assets, liabilities, and working capital at December 31, 2025 and
December 31, 2024.
|
|
|
December 31, |
|
|
December 31, |
|
|
Increase/ |
|
|
|
|
|
|
2025 |
|
|
2024 |
|
|
(Decrease) $ |
|
% |
|
|
Current assets |
$ |
496,375 |
|
$ |
2,319,280 |
|
$ |
(1,822,905) |
|
-78.6% |
|
|
Current liabilities |
$ |
494,400 |
|
$ |
46,915 |
|
$ |
447,485 |
|
953.8% |
|
|
Working capital (deficit) |
$ |
1,975 |
|
$ |
2,272,365 |
|
$ |
2,270,390 |
|
-99.9% |
|
The decrease of $2,270,390
in working capital was mainly due to a decrease in cash as of December 31,
2025, compared to December 31, 2024, related to payroll and legal expenses paid
during the year and operating expenses.
**Cash Flows**
We had $2,198,494 of net cash
used in operating activities for the year ended December 31, 2025, which was
mainly due to $9,491,534 of net loss, offset by $7,232,145
of stock-based compensation expense. We had $149,377 of net cash used in
operating activities for the year ended December 31, 2024, which was mainly due
to $793,749 of net loss, offset by $619,867 of stock-based compensation expense
and $24,235 of accounts payable and accrued expenses.
|
|
39 |
|
|
|
|
|
We had $25,000 and $10,050 of net
cash used in investing activities for the years ended December 31, 2025 and 2024,
respectively, which was due to acquisition of the World Series of Pickleball
trademark, which was
included as an intangible asset in 2025, as
compared to acquisition of property and equipment in 2024.
We had $0 and $2,478,669 of net
cash provided by financing activities for the years ended December 31, 2025 and
2024, respectively, which for the 2024 period was mainly due to the issuance of
common stock pursuant to a private placement for net proceeds of $2,472,606, as
discussed below, and $6,063 of proceeds from related parties.
We do not currently have any
additional commitments or identified sources of additional capital from third
parties or from our officers, directors or majority stockholders. Additional
financing may not be available on favorable terms, if at all.
In the future, we may be required
to seek additional capital by selling additional debt or equity securities, or
otherwise be required to bring cash flows in balance when we approach a
condition of cash insufficiency. The sale of additional equity or debt
securities, if accomplished, may result in dilution to our then stockholders.
Financing may not be available in amounts or on terms acceptable to us, or at
all. In the event we are unable to raise additional funding and/or obtain
revenues sufficient to support our expenses, we may be forced to curtail or
abandon our business operations, and any investment in the Company could become
worthless.
**Going Concern**
The accompanying financial
statements have been prepared on a going concern basis, which contemplates the
realization of assets and the satisfaction of liabilities in the normal course
of business. As shown in the
accompanying financial statements, for the years ended December 31, 2025 and
2024, the Company had a net loss of $9,491,534
and $793,749,
respectively As of December 31, 2025, we had an
accumulated deficit of $39,630,102. These
factors raise substantial doubt about the Companys ability to continue as a
going concern within one year after the date that the financial statements are
issued.
The Company has no significant
assets and continues to depend on equity raises to provide funds to pay its
ongoing expenses. There can be no assurance however that the Company will be
able to raise additional capital when needed, or at terms deemed acceptable, if
at all. These factors raise substantial doubt about the Companys ability to
continue as a going concern within one year after the date that the financial
statements are issued.
The financial statements do not
include any adjustments relating to the recoverability and classification of
asset carrying amounts or the amount and classification of liabilities that
might result should the Company be unable to continue as a going concern.
**Off-Balance Sheet Arrangements**
We do not have any off-balance sheet arrangements that have
or are reasonably likely to have a current or future effect on our financial
condition, changes in financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures or capital resources that are material
to investors.
**Critical Accounting Policies and Estimates**
The preparation of financial
statements and related disclosures in conformity with U.S. generally accepted
accounting principles and the Companys discussion and analysis of its
financial condition and operating results require the Companys management to
make judgments, assumptions and estimates that affect the amounts reported.
Management bases its estimates on historical experience and on various other
assumptions it believes to be reasonable under the circumstances, the results
of which form the basis for making judgments about the carrying values of
assets and liabilities. Actual results may differ from these estimates, and
such differences may be material.
Note 2. Summary of
Significant Accounting Policies in the Notes to Financial Statements in
Part II, Item 8, of this Report, describe the significant accounting policies
and methods used in the preparation of the Companys consolidated financial
statements.
|
|
40 |
|
|
|
|
|
**Related party transactions**
Parties are considered to be
related to the Company if the parties, directly or indirectly, through one or
more intermediaries, control, are controlled by, or are under common control
with the Company. Related parties also include principal owners of the Company,
its management, members of the immediate families of principal owners of the
Company and its management and other parties with which the Company may deal if
one party controls or can significantly influence the management or operating
policies of the other to an extent that one of the transacting parties might be
prevented from fully pursuing its own separate interests.
****
**Stock-Based Compensation**
The Company accounts for
stock-based compensation to employees in accordance with Financial Accounting
Standards Board (FASB) Accounting Standards Codification (ASC) 718,
Compensation-Stock Compensation. ASC 718 requires companies to measure the
cost of employee services received in exchange for an award of equity
instruments, including stock options, based on the grant date fair value of the
award and to recognize it as compensation expense over the period the employee
is required to provide service in exchange for the award, usually the vesting
period. Stock option forfeitures are recognized at the date of employee
termination.
**Recent Accounting Developments**
The Company believes there are no
new accounting standards adopted but not yet effective that are relevant to the
readers of our financial statements.
**ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK**
Pursuant to Item 305(e) of Regulation S-K ( 229.305(e)),
the Company is not required to provide the information required by this Item as
it is a smaller reporting company, as defined by Rule 229.10(f)(1).
**ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA**
**AGASSI SPORTS ENTERTAINMENT CORP.**
**TABLE OF CONTENTS TO FINANCIAL STATEMENTS**
|
|
Page |
|
|
Index to Financial Statements |
|
|
|
Report of Independent Registered Public Accounting Firm |
42 |
|
|
Balance Sheets |
43 |
|
|
Statements of Operations |
44 |
|
|
Statements of Stockholders Equity (Deficit) |
45 |
|
|
Statements of Cash Flows |
46 |
|
|
Notes to Financial Statements |
47 |
|
|
|
41 |
|
|
|
|
|
**REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM******
**REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**
To the Board of
Directors and Stockholders of
Global Acquisitions Corporation
**Opinion on the
Financial Statements**
We
have audited the accompanying balance sheets of Global Acquisitions Corporation
(the Company) as of December 31, 2025 and 2024, and the related statements of
operations, stockholders equity (deficit), and cash flows for each of the
years in the two-year period ended December 31, 2025,
and the related notes (collectively referred to as the financial statements).
In our opinion, the financial statements present fairly, in all material
respects, the financial position of the Company as of December 31, 2025 and
2024, and the results of its operations and its cash flows for each of the
years in the two-year period ended December 31, 2025, in conformity with
accounting principles generally accepted in the United States of America.
**The Companys
Ability to Continue as a Going Concern**
The
accompanying financial statements have been prepared assuming the Company will
continue as a going concern. As discussed in Note 4
to the accompanying financial statements, the Company has suffered recurring
losses from operations, generated negative cash flows from operating
activities, and has an accumulated deficit that raises substantial doubt about
the Companys ability to continue as a going concern. Management's evaluation
of the events and conditions and managements plan in regard to these matters
are also described in Note 4.
The financial statements do not include any adjustments that might result from
the outcome of this uncertainty.****
**Basis for Opinion**
These
financial statements are the responsibility of the Companys management. Our
responsibility is to express an opinion on the Companys financial statements
based on our audits. We are a public accounting firm registered with the Public
Company Accounting Oversight Board (United States) (PCAOB) and are required to
be independent with respect to the Company in accordance with the U.S. federal
securities laws and the applicable rules and regulations of the Securities and
Exchange Commission and the PCAOB.
We
conducted our audits in accordance with the standards of the PCAOB. Those
standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement, whether due to error or fraud. The Company is not required to
have, nor were we engaged to perform, an audit of its internal control over
financial reporting. As part of our audits, we are required to obtain an
understanding of internal control over financial reporting, but not for the
purpose of expressing an opinion on the effectiveness of the Companys internal
control over financial reporting. Accordingly, we express no such opinion.
Our
audits included performing procedures to assess the risks of material
misstatement of the financial statements, whether due to error or fraud, and
performing procedures that respond to those risks. Such procedures included
examining, on a test basis, evidence regarding the amounts and disclosures in
the financial statements. Our audits also included evaluating the accounting
principles used and significant estimates made by management, as well as
evaluating the overall presentation of the financial statements. We believe
that our audits provide a reasonable basis for our opinion.
**Critical
Audit Matters**
****
Critical audit matters are matters arising from the
current period audit of the financial statements that were communicated or
required to be communicated to the audit committee and that: (1) relate to
accounts or disclosures that are material to the financial statements, and (2)
involved our especially challenging, subjective, or complex judgments.
We
determined that there are no critical audit matters.
*
/s/ RBSM LLP*
We have served as the Companys auditor since 2015.
PCAOB ID 587
Houston, TX
March 31,
2026
|
|
42 |
|
|
|
|
|
**Agassi Sports Entertainment Corp.,**
**formerly****Global Acquisitions Corporation**
****
**B****ALANCE S****HEETS**
|
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
|
|
|
2025 |
|
|
2024 |
|
|
|
ASSETS |
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
Cash and cash equivalents |
$ |
95,748 |
|
$ |
2,319,242 |
|
|
|
Prepaid expenses and other current assets |
|
400,627 |
|
|
38 |
|
|
|
Total current assets |
|
496,375 |
|
|
2,319,280 |
|
|
|
Property and equipment, net |
|
7,770 |
|
|
9,780 |
|
|
|
Intangible asset, net |
|
296,298 |
|
|
- |
|
|
|
Total assets |
$ |
800,443 |
|
$ |
2,329,060 |
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) |
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
Accounts payable and accrued expenses |
$ |
486,900 |
|
$ |
46,915 |
|
|
|
Note payable |
|
7,500 |
|
|
- |
|
|
|
Total liabilities |
|
494,400 |
|
|
46,915 |
|
|
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies (Note 9) |
|
- |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity (deficit): |
|
|
|
|
|
|
|
|
Preferred stock, $0.001 par value, 5,000,000 shares authorized, no shares issued andoutstanding as of both December 31, 2025 and 2024 |
|
- |
|
|
- |
|
|
|
Common stock, $0.001 par value, 500,000,000 shares authorized, 9,785,056 and 9,785,056 sharesissued and outstanding as of December 31, 2025 and 2024, respectively |
|
9,785 |
|
|
9,785 |
|
|
|
Additional paid-in capital |
|
39,926,360 |
|
|
32,410,928 |
|
|
|
Accumulated deficit |
|
(39,630,102) |
|
|
(30,138,568) |
|
|
|
Total stockholders' equity |
|
306,043 |
|
|
2,282,145 |
|
|
|
Total liabilities and stockholders' equity |
$ |
800,443 |
|
$ |
2,329,060 |
|
|
The accompanying
notes are an integral part of these financial statements.
|
|
43 |
|
|
|
|
|
**Agassi Sports Entertainment Corp.,**
**formerly****Global Acquisitions Corporation**
**S****TATEMENTS OF O****PERATIONS**
|
|
|
|
|
|
|
|
|
|
|
|
For the Years Ended December 31, |
|
|
|
|
|
2025 |
|
|
2024 |
|
|
|
Operating Expenses: |
|
|
|
|
|
|
|
|
General & administrative |
|
9,490,540 |
|
$ |
$793,749 |
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses |
|
(9,490,540) |
|
|
(793,749) |
|
|
|
|
|
|
|
|
|
|
|
|
Interest Expense |
|
(994) |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expense |
|
(9,491,534) |
|
|
(793,749) |
|
|
|
|
|
|
|
|
|
|
|
|
Net loss before provision for income tax |
|
(9,491,534) |
|
|
(793,749) |
|
|
|
Provision for income tax expense |
|
- |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss |
$ |
(9,491,534) |
|
$ |
(793,749) |
|
|
|
Weighted average number of common shares outstanding-basic and fully diluted |
|
9,785,056 |
|
|
6,788,997 |
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per share basic and fully diluted |
$ |
(0.97) |
|
$ |
(0.12) |
|
|
****
The accompanying notes are an integral part
of these financial statements.
|
|
44 |
|
|
|
|
|
**Agassi Sports Entertainment Corp.,**
**formerly****Global Acquisitions Corporation**
**S****TATEMENTS O****F STOCKHOLDERS
EQUITY (D****EFICIT)**
**F****OR T****HE Y****EARS E****NDED D****ECEMBER 31, 2025 A****ND 2024******
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional |
|
|
|
|
|
Total |
|
|
|
|
Common Stock |
|
|
Paid-in |
|
|
Accumulated |
|
|
Stockholders' |
|
|
|
|
Shares |
|
|
Amount |
|
|
Capital |
|
|
Deficit |
|
|
Equity (Deficit) |
|
|
Balances, December 31, 2023 |
|
5,658,123 |
|
$ |
5,658 |
|
$ |
28,728,912 |
|
$ |
(29,344,819) |
|
$ |
(610,249) |
|
|
Shares issued pursuant to settlement of payables |
|
1,495,390 |
|
|
1,495 |
|
|
592,175 |
|
|
- |
|
|
593,670 |
|
|
Issuance of common stock pursuant to private placement |
|
2,631,543 |
|
|
2,632 |
|
|
2,497,368 |
|
|
- |
|
|
2,500,000 |
|
|
Offering costs |
|
- |
|
|
- |
|
|
(27,394) |
|
|
- |
|
|
(27,394) |
|
|
Stock-based compensation |
|
- |
|
|
- |
|
|
619,867 |
|
|
- |
|
|
619,867 |
|
|
Net loss |
|
- |
|
|
- |
|
|
- |
|
|
(793,749) |
|
|
(793,749) |
|
|
Balances, December 31, 2024 |
|
9,785,056 |
|
|
9,785 |
|
|
32,410,928 |
|
|
(30,138,568) |
|
|
2,282,145 |
|
|
Balances, December 31, 2024 |
|
9,785,056 |
|
|
9,785 |
|
|
32,410,928 |
|
|
(30,138,568) |
|
|
2,282,145 |
|
|
Warrants issued in acquisition of intangibles |
|
- |
|
|
- |
|
|
283,287 |
|
|
- |
|
|
283,287 |
|
|
Stock-based compensation |
|
- |
|
|
- |
|
|
7,232,145 |
|
|
- |
|
|
7,232,145 |
|
|
Net loss |
|
- |
|
|
- |
|
|
- |
|
|
(9,491,534) |
|
|
(9,491,534) |
|
|
Balances, December 31, 2025 |
|
9,785,056 |
|
$ |
9,785 |
|
$ |
39,926,360 |
|
$ |
(39,630,102) |
|
$ |
306,043 |
|
The
accompanying notes are an integral part of these financial statements.
|
|
45 |
|
|
|
|
|
**Agassi Sports Entertainment Corp.,**
**formerly****Global Acquisitions Corporation**
**STATEMENTS OF CASH FLOWS**
|
|
|
|
|
|
|
|
|
|
|
Year Ended |
|
|
|
|
December 31, |
|
|
|
|
2025 |
|
|
2024 |
|
|
|
|
|
|
|
|
|
|
Cash flows from operating activities: |
|
|
|
|
|
|
|
Net loss |
$ |
(9,491,534) |
|
$ |
(793,749) |
|
|
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
|
|
|
|
Depreciation and amortization |
|
13,999 |
|
|
270 |
|
|
Stock-based compensation expense |
|
7,232,145 |
|
|
619,867 |
|
|
Non-cash legal expense financed by note payable |
|
- |
|
|
- |
|
|
Non-cash interest expense |
|
994 |
|
|
- |
|
|
Changes in operating assets and liabilities: |
|
|
|
|
|
Prepaid expenses and other current assets |
|
(400,589) |
|
|
- |
|
|
Accounts payable and accrued expenses |
|
438,991 |
|
|
24,235 |
|
|
Net cash used in operating activities |
|
(2,198,494) |
|
|
(149,377) |
|
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
Purchase of property and equipment |
|
- |
|
|
(10,050) |
|
|
Acquisition of intangible asset |
|
(25,000) |
|
|
- |
|
|
Net cash used in investing activities |
|
(25,000) |
|
|
(10,050) |
|
|
Cash flows from financing activities: |
|
|
|
|
|
|
|
Proceeds from issuance of common stock, net of offering costs |
|
- |
|
|
2,472,606 |
|
|
Proceeds from related parties |
|
- |
|
|
6,063 |
|
|
Net cash provided by financing activities |
|
- |
|
|
2,478,669 |
|
|
Net change in cash and cash equivalents |
|
(2,223,494) |
|
|
2,319,242 |
|
|
Cash and cash equivalents at beginning of year |
|
2,319,242 |
|
|
- |
|
|
Cash and cash equivalents at end of year |
$ |
95,748 |
|
$ |
2,319,242 |
|
|
|
|
|
|
|
|
|
|
Supplemental disclosure of cash flow information: |
|
|
|
|
|
|
|
Cash paid for income taxes |
$ |
- |
|
$ |
- |
|
|
Cash paid for interest |
$ |
- |
|
$ |
- |
|
|
|
|
|
|
|
|
|
|
Supplemental disclosure of non-cash financing activities: |
|
|
|
|
|
|
|
Warrants issued in acquisition of intangibles |
$ |
283,287 |
|
$ |
- |
|
|
Shares issued pursuant to settlement of payables |
$ |
- |
|
$ |
593,670 |
|
|
Note payable issued for legal expense |
$ |
7,500 |
|
$ |
- |
|
|
Supplemental disclosure of non-cash financing activities |
$ |
290,787 |
|
$ |
593,670 |
|
****
The accompanying notes are an integral part
of these financial statements.
|
|
46 |
|
|
|
|
|
**Agassi Sports Entertainment Corp.,**
**formerly****Global Acquisitions Corporation**
****
**Notes
to Condensed Financial Statements**********
**NOTE 1. ORGANIZATIONAL STRUCTURE AND BASIS OF PRESENTATION**
a.
ORGANIZATION
Agassi
Sports Entertainment Corp. (the "Company") was incorporated in Nevada on March 6, 1984, under the name "Sporting Life, Inc." The Company's name was changed to
"St. Andrews Golf Corporation" on December 27, 1988, to "Saint Andrews Golf
Corporation" on August 12, 1994, and to "All-American SportPark, Inc." ("AASP")
on December 14, 1998. Effective February 15, 2021, the name of the Company was
changed to "Global Acquisitions Corporation." On
March 31, 2025, the Company legally changed its name from "Global Acquisitions
Corporation" to "Agassi Sports Entertainment Corp."
On June
10, 2016, the Company entered into a Transfer Agreement for the sale and
transfer of the Company's 51% interest in All-American Golf Center, Inc.
("AAGC"), which at the time constituted substantially all of the Company's
assets. On October 18, 2016, the Company completed the closing of the Transfer
Agreement pursuant to which the Company transferred the 51% interest in AAGC to
Ronald Boreta, the Chief Executive Officer, President and director of the
Company and John Boreta, his brother, who was at the time a member of the Board
of Directors of the Company (collectively, the "Boretas"), and also issued to
the Boretas1,000,000shares of the Company's common stock, in
exchange for the cancellation of promissory notes held by the Boretas and
accrued interest totaling $8,864,255. AAGC constituted substantially all of the
Company's assets and following the closing of the Transfer Agreement, the
Company had no or nominal operations and no or nominal assets and was therefore
considered to be a "Shell Company" as that term is defined in Rule 12b-2 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"). The Company
remained a "Shell Company" until May 31, 2025, when the Company entered into
that certain Trademark Acquisition Agreement dated May 31, 2025, discussed in
greater detail below under Note 5.
In connection with
the closing of the Transfer Agreement, AAGC assumed the obligation of the
Company to pay Ronald Boreta for deferred salary of $340,000. In addition, AAGC
cancelled $4,267,802 in advances
previously made by it to the Company to fund
its operations.
Also in connection
with the closing of the Transfer Agreement, entities controlled by the Boretas
cancelled $1,286,702 owed to
them by the Company. In addition, the Company
cancelled $27,615 of amounts
due from entities controlled by the Boretas.
Also, as a result
of the Transfer Agreement, on October 18, 2016, the Company derecognized the
assets and liabilities of AAGC.
The sale and transfer of the Companys 51% interest
in AAGC to the controlling shareholders of the Company is a common control
transaction and recorded at book value. Any difference between the proceeds
received by the Company and the book value of assets and liabilities of AAGC,
cancellation of promissory notes and accrued interest, assumption of deferred
salary, cancellation of amounts due to and due from entities controlled by the
Boretas is recognized as a capital transaction with no gain or loss recorded.
b. BASIS OF PRESENTATION
The financial statements of the Company have been prepared in accordance
with the accounting principles generally accepted in the United States of
America. (GAAP).
c. BUSINESS ACTIVITIES
At this
time, the Companys purpose is to seek, investigate and, if such investigation
warrants, acquire an interest in business opportunities presented to the
Company by persons or firms who or which desire to seek the perceived
advantages of a corporation whose securities are registered pursuant to the
Exchange Act. The Company is currently focused on opportunities in the
pickleball and padel industries.
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**NOTE 2**. **SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES**
a. USE OF ESTIMATES
The
preparation of these financial statements in conformity with GAAP requires
management to make estimates and assumptions that affect the reported amounts
of assets and liabilities, and the disclosure of contingent assets and
liabilities at the date of the financial statements, and the reported amount of
revenues and expenses during the reporting period. Significant estimates and
assumptions made by management include, but are not limited to, the
determination of the provision for income taxes and fair value of warrants. The
Company bases the estimates on historical experience and on various other
assumptions that are believed to be reasonable. Actual results could differ
from those estimates.
*b. CASH AND CASH EQUIVALENTS*
The Company considers all highly liquid instruments with maturity of
three months or less at the time of issuance to be cash equivalents.
c. CASH DEPOSITS
Time deposits
represent interest-bearing deposits with financial institutions that have
original maturities of greater than three months and are classified within Prepaid
expenses and other current assets on the balance sheets due to their expected
use within one year. Time deposits are recorded at cost, which approximates
fair value due to their short-term maturities.
The Company monitors
the creditworthiness of the financial institutions with which time deposits are
placed and does not believe it is exposed to significant credit risk. The
Company has not experienced any losses related to these instruments during the
periods presented.
d. PROPERTY AND EQUIPMENT, NET
Property and equipment are stated at cost less accumulated depreciation
and amortization. Property and equipment consists of computer equipment and
depreciation expense is recognized using the straight-line method over the
estimated useful life of five years for computer and equipment.
When assets are retired or otherwise disposed of, the cost,
accumulated depreciation and amortization are removed from the accounts and any
resulting gain or loss is reflected in the statements of operations in the
period realized. Maintenance and repairs that do not enhance or extend the
assets useful life are charged to operating expenses as incurred.
The following is a summary of property and equipment as of:
Schedule
Of Property And Equipment
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December 31, |
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2025 |
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2024 |
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Computer and equipment |
$ |
10,050 |
|
$ |
10,050 |
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Accumulated depreciation |
|
(2,280) |
|
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(270) |
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Property and equipment, net |
$ |
7,770 |
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$ |
9,780 |
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Depreciation expense was $2,010 and $270 for the years ended December 31, 2025 and 2024, respectively.
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e.****INTANGIBLE
ASSET
Intangible assets are amortized over the respective estimated lives on a
straight-line basis, unless the lives are determined to be indefinite and reviewed for impairment whenever events or other changes in
circumstances indicate that the carrying amount may not be recoverable.Impairment testing compares carrying values to fair values
and, when appropriate, the carrying value of these assets is reduced to fair value. Impairment charges, if any, are recorded in the
period in which the impairment is detected. As of December 31, 2025, intangible asset consists of the trademark acquired from Patrick J.
Rolfes and Ted Angelo (the "Sellers"), the owners of the trademark for "*World Series of Pickleball*" (the
"Trademark"). Pursuant to the Trademark Acquisition Agreement, we acquired all rights to, and ownership of, the Trademark, in
consideration for $25,000 in cash and warrants to purchase 50,000 shares of the Company's common stock with a fair value of $283,287 (see Notes 5 and 6).The Trademark is amortized over
its estimated useful life of 15years, which represents the estimated protection life of the asset.
Amortization expense was $11,989
for the year ended December 31, 2025. The carrying value of the related asset remaining for amortization as of December 31, 2025 was
$296,298.
Future amortization expense is as follows:
Schedule of Finite Lived Intangible Assets Future Amortization Expense
|
Year ended December 31, |
|
Amount |
|
|
2026 |
$ |
20,552 |
|
|
2027 |
|
20,552 |
|
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2028 |
|
20,552 |
|
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2029 |
|
20,552 |
|
|
Thereafter |
|
214,088 |
|
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Total |
$ |
296,298 |
|
f.****IMPAIRMENT
OF LONG-LIVED ASSETS
The Company
continually monitors events and changes in circumstances that could indicate
carrying amounts of long-lived assets may not be recoverable. When such events
or changes in circumstances are present, the Company assesses the
recoverability of long-lived assets by determining whether the carrying value
of such assets will be recovered through undiscounted expected future cash
flows. If the total of the future cash flows is less than the carrying amount
of those assets, the Company recognizes an impairment loss based on the excess
of the carrying amount over the fair value of the assets. Assets to be disposed
of are reported at the lower of the carrying amount or the fair value less
costs to sell. The Company did not record any impairment losses on its
long-lived assets as of December 31, 2025.
g. INCOME TAXES
The Company accounts for income taxes under the
asset and liability method, which requires the recognition of deferred tax
assets and liabilities for the expected future tax consequences of events that
have been included in the financial statements. Under this method, deferred tax
assets and liabilities are determined based on the differences between the
financial statements and tax basis of assets and liabilities using enacted tax
rates in effect for the year in which the differences are expected to reverse.
The effect of a change in tax rates on deferred tax assets and liabilities is
recognized in income in the period that includes the enactment date. The
Company records net deferred tax assets to the extent the Company believes
these assets will more likely than not be realized. In making such
determination, the Company considers all available positive and negative
evidence, including future reversals of existing taxable temporary differences,
projected future taxable income, tax planning strategies and recent financial
operations. A valuation allowance is established against deferred tax assets
that do not meet the criteria for recognition. In the event the Company were to
determine that it would be able to realize deferred income tax assets in the
future in excess of their net recorded amount, the Company would make an
adjustment to the valuation allowance which would reduce the provision for
income taxes.
The Company follows the accounting guidance which
provides that a tax benefit from an uncertain tax position may be recognized
when it is more likely than not that the position will be sustained upon
examination, including resolutions of any related appeals or litigation
processes, based on the technical merits. Income tax positions must meet a
more-likely-than-not recognition threshold at the effective date to be
recognized initially and in subsequent periods. Also included is guidance on
measurement, de-recognition, classification, interest and penalties, accounting
in interim periods, disclosure and transition.
h. FAIR VALUE OF FINANCIAL INSTRUMENTS
The Company adopted Accounting Standards
Codification (ASC) 820 Fair Value Measurement related to fair value
measurement at inception. The standard defines fair value, establishes a
framework for measuring fair value and expands disclosure of fair value
measurements. The standard applies under other accounting pronouncements that
require or permit fair value measurements and, accordingly, does not require
any new fair value measurements. The standard clarifies that fair value is an
exit price, representing the amount that would be received to sell an asset or
paid to transfer a liability in an orderly transaction between market
participants. As such, fair value is a market-based measurement that should be
determined based on assumptions that market participants would use in pricing
an asset or liability. As a basis for considering such assumptions, the
standard established a three-tier fair value hierarchy, which prioritizes the
inputs used in measuring fair value as follows:
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Level 1: Observable inputs
such as quoted prices in active markets; |
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Level 2:
Inputs, other than quoted prices in active markets, that are observable either
directly or indirectly; and |
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Level 3: Unobservable inputs in which there is little or
no market data, which require the reporting entity to develop its own
assumptions. |
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At December 31, 2025 and 2024, the carrying amount ofdue to related party and accounts
payable and accrued liabilities approximate fair value because of the short
maturity of these instruments.
i. EARNINGS (LOSS) PER SHARE
Basic earnings per share excludes any dilutive effects of options,
warrants, and convertible securities. Basic earnings per share are computed using the weighted average number of shares of common stock
and common stock equivalent shares outstanding during the year. Common stock equivalent shares are excluded from the computation if
their effect is antidilutive. As of December 31, 2025, we had 4,925,000 outstanding warrants to purchase shares of common stock.
Loss per share is computed by dividing reported net loss by the weighted
average number of common shares outstanding during the year. The weighted-average number of common shares used in the calculation of
basic loss per share was 9,785,056 in 2025 and 6,788,997 in 2024, respectively.
j.
RELATED PARTIES
Parties are
considered to be related to the Company if the parties, directly or indirectly,
through one or more intermediaries, control, are controlled by, or are under
common control with the Company. Related parties also include principal owners
of the Company, its management, members of the immediate families of principal
owners of the Company and its management and other parties with which the
Company may deal if one party controls or can significantly influence the
management or operating policies of the other to an extent that one of the
transacting parties might be prevented from fully pursuing its own separate
interests.
k. STOCK-BASED
COMPENSATION****
The Company accounts for stock-based compensation
to employees in accordance with Financial Accounting Standards Board (FASB) ASC
718, Compensation-Stock Compensation. ASC 718 requires companies to measure
the cost of employee services received in exchange for an award of equity
instruments, including stock options, based on the grant date fair value of the
award and to recognize it as compensation expense over the period the employee
is required to provide service in exchange for the award, usually the vesting
period. Stock option forfeitures are recognized at the date of employee
termination.
l. SEGMENT INFORMATION
In accordance with ASC 280, Segment Reporting
(ASC 280), we identify our operating segments according to how our business
activities are managed and evaluated. ASC 280 establishes standards for
companies to report financial statement information about operating segments,
products, services, geographic areas, and major customers.Operating
segments are defined as components of an enterprise for which separate
financial information is available that is regularly evaluated by the Companys
chief operating decision maker (CODM), which
is Ronald S. Boreta, its President
and CEO, in deciding how to allocate resources and assess performance.
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50 |
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m. RECENT ACCOUNTING PRONOUNCEMENTS
InDecember 2023,the FASB issued ASU2023-09,Income
Taxes (Topic740):*Improvements to Income Tax Disclosures*
which is intended to enhance the transparency and decision usefulness of income
tax disclosures. The guidance addresses investor requests for enhanced income
tax information primarily through changes to the rate reconciliation and income
taxes paid information. The guidance is effective for annual periods beginning
afterDecember 15, 2024.The Company adopted ASU 2023-09 on January
1, 2025. The adoption of ASU 2023-09 has not had a material impact on the
Companys financial statements and disclosures.
The Company believes
there was no other new accounting guidance adopted but not yet effective that
either has not already been disclosed in prior reporting periods or is relevant
to the readers of the Companys financial statements.
The Company continually assesses any new accounting
pronouncements to determine their applicability to the Company. Where it is
determined that a new accounting pronouncement affects the Companys financial
reporting, the Company undertakes a study to determine the consequence of the
change to its financial statements and assures that there are proper controls
in place to ascertain that the Companys financials properly reflect the
change.
**NOTE 3 SEGMENT REPORTING**
****
The CODM has been identified as the Chief
Executive Officer, who reviews the operating results for the Company as a whole
to make decisions about allocating resources and assessing financial
performance. Accordingly, management has determined that the Company only has one
operating and reportable segment.
When evaluating the Companys performance and
making key decisions regarding resource allocation the CODM reviews several key
metrics, which include the following:
Schedule of Segment Reporting
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Year
Ended |
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December 31, |
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|
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2025 |
|
|
2024 |
|
|
|
Total operating
expenses |
$ |
9,490,540 |
|
$ |
793,749 |
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The key measures of segment profit or loss
reviewed by our CODM are operating expenses. Operating costs are reviewed and
monitored by the CODM to manage and forecast cash. The CODM also reviews
operating costs to manage, maintain and enforce all contractual agreements to
ensure costs are aligned with all agreements and budget.
**NOTE 4.****GOING CONCERN**
The accompanying financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As
shown in the accompanying financial statements, for the years ended December 31, 2025 and 2024, the Company had a net loss of $9,491,534 and $793,749, respectively. As of December 31, 2025, the Company had an accumulated deficit of $39,630,102. These factors raise substantial doubt about the Company's ability to
continue as a going concern within one year after the date that the financial statements are issued.
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The
Companys management believes that its operations will not be sufficient to
fund operating cash needs over at least the next 12 months. The Company may
require additional funding in the future. The Company plans to raise additional
required funding when required through the sale of debt or equity, which may
not be available on favorable terms, if at all, and may, if sold, cause
significant dilution to existing stockholders. If the Company is unable to
access additional capital moving forward, it may hurt its ability to grow and
to generate revenues.
The financial statements do not include any
adjustments relating to the recoverability and classification of asset carrying
amounts or the amount and classification of liabilities that might result
should the Company be unable to continue as a going concern.
****
**NOTE 5. TRADEMARK ACQUISITION**
On May 31, 2025, the Company entered into a Trademark Acquisition
Agreement with Patrick J. Rolfes and Ted Angelo, the owners of the trademark for "*World Series of Pickleball*". Pursuant to
the Trademark Acquisition Agreement, the Company acquired all rights to, and ownership of, the Trademark, in consideration for $25,000 in cash and warrants to purchase 50,000 shares of the Company's common stock (with warrants to purchase 25,000 shares
granted to each seller)(the "Sellers Warrants").
The Trademark Acquisition Agreement includes customary
representations and indemnification obligations of the sellers, for a
transaction of the size and type, as the Trademark acquisition. As additional
consideration payable to each of the sellers, we agreed that during the
lifetime of each of the sellers, we would furnish them an aggregate of six (6)
VIP tickets to all World Series of Pickleball events produced by or on behalf
of the Company. Such tickets are subject to all the rules and
regulations, including standards of behavior, applicable to tickets generally.
The Sellers Warrants have an exercise price of $5.75 per share
(the closing sales price of the Company's common stock on the last trading day prior to the entry into the Trademark Acquisition
Agreement) and a three year term and are exercisable only on a cash basis. The Sellers Warrants include a 4.999%
beneficial ownership limitation, which can be increased to 9.999% by either holder, with at least 61 days prior written notice to the
Company.
**NOTE 6.
CAPITAL STOCK, STOCK OPTIONS, AND INCENTIVES**
PREFERRED
STOCK
Preferred stock, $0.001 par value, 5,000,000 shares authorized, no shares issued and outstanding as of December 31, 2025
and December 31, 2024. The Company's Board of Directors shall determine the rights, preferences, privileges and restrictions of
the preferred stock, including dividends rights, conversion rights, voting rights, terms of redemption, liquidation preferences, sinking
fund terms and the number of shares constituting any series or the designation of any series.
COMMON STOCK
Effective February 15, 2022, the number of
authorized shares of common stock, $0.001 par value, was increased to 500,000,000
shares.
Effective on July 3, 2024, the Company issued 1,495,390 shares of common stock in exchange for the release of obligations of the
Company to repay expenses in the aggregate amount of $593,670 for expenses of the Company previously paid by the related parties. The shares were issued at an
implied price of $0.397 per share.
In November 2024, the Company issued an aggregate of 2,631,543 shares of restricted common stock
for gross proceeds of $2,500,000, or $0.95 per share, in a
private placement. In connection with this offering, the Company incurred $27,394 in
offering costs.
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There were 9,785,056 and 9,785,056 shares of common stock issued and outstanding as of December 31,
2025 and 2024, respectively.
WARRANTS
The following is
a summary of warrants for the years ended December31, 2025 and 2024:
Summary of Warrants
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Warrants |
|
|
Weighted Average Exercise Price |
|
|
Intrinsic Value |
|
|
Outstanding as of December 31, 2023 |
|
- |
|
$ |
- |
|
$ |
- |
|
|
Granted |
|
2,975,000 |
|
|
0.40 |
|
|
- |
|
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Exercised |
|
- |
|
|
- |
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- |
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Forfeited |
|
- |
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- |
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- |
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Outstanding as of December 31, 2024 |
|
2,975,000 |
|
|
0.40 |
|
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7,000,175 |
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Granted |
|
1,950,000 |
|
|
3.87 |
|
|
- |
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Exercised |
|
- |
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- |
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- |
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Forfeited |
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- |
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- |
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- |
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Outstanding as of December 31, 2025 |
|
4,925,000 |
|
$ |
1.77 |
|
$ |
20,592,675 |
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Exercisable as of December 31, 2024 |
|
2,975,000 |
|
$ |
0.40 |
|
$ |
7,000,175 |
|
|
Exercisable as of December 31, 2025 |
|
4,925,000 |
|
$ |
1.77 |
|
$ |
20,592,675 |
|
The
weighted-average remaining term of the warrants outstanding was 3.87 years as
of December31, 2025.
The Company, for consulting services agreed to be rendered, onMarch
6, 2025, issued to Darren Cahill, warrants to purchase up to 250,000 shares of the Company's common stock, at the exercise price of $1.70 per share of common stock. The warrants expire on March 5, 2030. The warrants are exercisable as to one half of
the shares of common stock immediately, and exercisable as to the remaining half of the shares of common stock one year following the
grant date of the warrants.
The Company, for consulting services agreed to be rendered, onMarch
6, 2025, issued to Justin Gimblestob, warrants to purchase up to 500,000 shares of the Company's common stock, at the exercise price of $1.70 per share of common
stock. The warrants expire on March 5,
2030. The warrants are exercisable as to one half of the shares of common stock immediately, and exercisable as to the remaining
half of the shares of common stock one year following the grant date of the warrants.
The Company, for services agreed to be rendered as the Company's Chief
Financial Officer, onMarch 6, 2025, issued to Shawn Cable, warrants to purchase up to 100,000 shares of the Company's common stock, at the exercise price of $1.70 per share of common stock.
The warrants expire on March 5, 2030.
The warrants are exercisable as to one half of the shares of common stock immediately, and exercisable as to the remaining half of the
shares of common stock one year following the grant date of the warrants.
In connection with the Trademark Purchase Agreement
discussed in greater detail under Note 6, the Company granted the Sellers warrants to purchase 50,000 shares of the Companys common
stock. The warrants have an exercise price of $5.75 per share (the closing sales price of the Companys common stock on the last
trading day prior to the entry into the Trademark Acquisition Agreement) and a three-year term and are exercisable only on a cash basis.
The warrants include a 4.999% beneficial ownership limitation, which can be increased to 9.999% by either holder, with at least 61 days
prior written notice to the Company.
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In connection with the Trademark Purchase Agreement discussed in greater
detail under Note 6, the Company granted the Sellers warrants to purchase 50,000 shares of the Company's common stock. The warrants have an exercise price of $5.75 per share (the closing sales price of the Company's common stock on the last trading day prior to the
entry into the Trademark Acquisition Agreement) and a three year
term and are exercisable only on a cash basis. The warrants include a 4.999% beneficial ownership limitation, which can be increased to 9.999% by either holder, with at least 61
days prior written notice to the Company.
The Company, for consulting services agreed to be rendered,
onOctober 31, 2025, issued to Stefanie Graf, warrants to purchase 1,000,000
shares of the Company's common stock, at the exercise price of $5.50 per share of common stock.
The warrants expire on October 31, 2030.
The warrants are exercisable as to one half of the shares of common stock immediately, and exercisable as to the remaining half of the
shares of common stock one year following the grant date of the warrants.
The fair value of the warrants was $7,515,432 and $619,867,
respectively, during the years ended December 31, 2025 and 2024, which was valued using the Black-Scholes pricing model using the range
of inputs as indicated below:
Schedule of Warrants Valuation Assumptions
|
|
Year
Ended December 31, |
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|
|
|
2025 |
|
2024 |
|
|
|
Risk-free interest rate |
3.71% - 4.06% |
|
4.33% |
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Expected term (in years) |
3 years - 5
years |
|
5.00 |
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Expected volatility |
259.67% - 279.43% |
|
244.14% |
|
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Expected dividend yield |
0.00% |
|
0.00% |
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The Company capitalized $283,287in intangible asset pertaining to these warrants on May 31, 2025, based on the vesting
conditions noted above. The Company recognized $7,232,145 and $619,867in stock-based compensation expense pertaining to these warrants during the years ended
December 31, 2025 and 2024, based on the vesting conditions noted above.
**NOTE 7**. **RELATED PARTY TRANSACTIONS**
*Due to related parties*
AAGC has in the past, advanced funds to pay certain
expenses of the Company. The Company formerly owned a 51% interest in AAGC.
On July 3, 2024, the Company entered into a share purchase agreement with
All American Golf Center, Inc., pursuant to which the Creditor agreed to exchange shares of the Company's common stock in consideration
for the Creditor's release of obligations of the Company to repay expenses in the aggregate amount of $593,670 for expenses of the Company previously paid by the Creditor. Pursuant to the Purchase
Agreement, the 1,495,390 shares of common stock to be issued by the Company to the Creditor upon consummation of the
exchange was determined based upon an implied price per share of common stock, equal to $0.397.The Creditor is an existing significant stockholder of the Company that is owned and controlled
by Ronald S. Boreta, President, Chief Executive Officer, Secretary, and a director of the Company, and John Boreta, a then director of
the Company. At December 31, 2025 and December 31, 2024, the total amounts owed to All-American Golf Center, Inc. were $0.
Effective on
July 3, 2024, the Company issued 1,495,390 shares of common stock in exchange
for the release of obligations of the Company to repay expenses in the aggregate
amount of $593,670 (the Payables) for expenses of the Company previously paid
by AAGC.
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Also on July 3, 2024, the Company issued warrants to purchase 2,975,000 shares of common stock at an exercise price
of $0.397 per share, (i) to James Askew, an individual, who was subsequently
appointed as a member of the Board of Directors of the Company (Warrants to purchase 2,269,583 shares of common stock), and (ii) to Investments AKA, LLC, a limited liability company indirectly
controlled by Andre Agassi (Warrants to purchase 705,417 shares of common stock). The Warrants vested immediately.The Warrants are exercisable
as to one half of the shares of common stock immediately, and exercisable as to the remaining half of the shares of common stock one
year following the grant date of the Warrant. The Warrants were issued to the Warrant Holders in consideration of services and support
previously performed and provided, and expected to be performed or provided, by the Warrant Holders in furtherance of the Company's
business objectives.
The
Company also entered into a Consulting Agreement, dated July 3, 2024, with
Askew with respect to his services and the issuance of his Warrants.
The Companys corporate offices are
located at 1120 N Town Center Drive, Suite 160, Las Vegas, Nevada 89144 in
space shared with Agassi Graf
Holding, which is provided to the Company without charge.
**NOTE 8. INCOME TAXES**
**Tax Cuts and Jobs
Act (TCJA) Impact on NOL Carryforward Rules**
On
December 22, 2017, the U.S. federal government enacted the Tax Cuts and Jobs
Act (the "2017
Tax Act"). The
2017 Tax Act reduced the federal corporate income tax
rate from 35% to 21%, effective January 1, 2018, and significantly modified net
operating loss (NOL) carryforward rules under IRC 172, as follows:
|
|
|
For NOLs arising in tax years before January
1, 2018: carryback 2 years and carryforward 20 years, at 100% offset of taxable
income. |
|
|
|
|
For NOLs arising in tax years beginning after
December 31, 2017: no carryback, indefinite carryforward, but utilization
limited to 80% of taxable income in any given year, per IRC 172 as amended by
TCJA. |
|
The
re-measurement of deferred taxes at the new 21% corporate
rate reduced the Company's
net deferred tax assets, before valuation allowance, by approximately $2.2
million upon enactment. Due
to the full valuation allowance maintained at
that time, the change in deferred taxes was fully offset by a corresponding
change in the valuation allowance with no net income
statement impact, consistent with ASC 740-10-45-15.
deferred taxes was fully offset by the change in
valuation allowance.
The components of income tax provision (benefit)
for the years ended December 31, 2025 and 2024 are as follow:
Schedule Of Components Of Income Tax Expense Benefit
|
|
|
2025 |
|
|
|
2024 |
|
|
|
Current taxes: |
|
|
|
|
|
|
|
Federal |
$ |
|
|
|
$ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current taxes |
|
|
|
|
|
|
|
|
|
Deferred tax provision (benefit) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax provision (benefit) |
$ |
|
|
|
$ |
|
|
|
A reconciliation of the income tax (provision)
benefit at the statutory rate of 21% for the years ended December 31, 2025 and
2024 to the Companys effective tax rate is as follows:
Schedule Of Effective Income Tax Rate Reconciliation
|
|
|
2025 |
|
|
|
2024 |
|
|
|
U.S. Statutory tax rate |
|
21.0 |
% |
|
|
21.0 |
% |
|
|
Change in valuation reserve on deferred tax assets |
|
(21 |
)% |
|
|
(21 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
Income tax (provision) benefit |
|
|
% |
|
|
|
% |
|
Significant components of the Companys deferred
tax assets (liabilities) as of December 31, 2025 and 2024 are as follows:
*Rate Reconciliation*
In accordance with ASU 2023-09, the following table
presents the rate reconciliation in both percentage and dollar amounts for the
years ended December 31, 2025 and 2024:
Schedule Of Income Before Income Tax Domestic And Foreign
|
|
|
Year EndedDecember 31,2025 |
|
|
Year EndedDecember 31,2024 |
|
|
|
|
|
Amount |
|
Percentage |
|
|
Amount |
|
Percentage |
|
|
|
Tax benefit at U.S. federal statutory rate
(21%) |
$ |
(1,993,222) |
|
21.0% |
|
$ |
(166,687) |
|
21.0% |
|
|
|
State income taxes, net of federal benefit |
|
|
|
0.0% |
|
|
|
|
0.0% |
|
|
|
Change in valuation allowance |
|
1,993,222 |
|
21.0% |
|
|
166,687 |
|
21.0% |
|
|
|
Effective income tax rate |
$ |
|
|
0.0% |
|
$ |
|
|
0.0% |
|
|
Schedule Of Deferred Tax Assets And Liabilities
|
|
|
2025 |
|
|
|
2024 |
|
|
|
Deferred tax assets: |
|
|
|
|
|
|
|
|
|
Net operating loss carryforwards |
$ |
1,674,489 |
|
|
$ |
1,200,018 |
|
|
|
Stock-based compensation |
|
1,648,922 |
|
|
|
130,172 |
|
|
|
Total deferred tax
assets |
|
3,323,412 |
|
|
|
1,330,190 |
|
|
|
Valuation
allowance |
|
(3,323,412 |
) |
|
|
(1,330,190 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Net deferred tax assets
(liability) |
$ |
|
|
|
$ |
|
|
|
|
|
55 |
|
|
|
|
|
*Net
Operating Loss Carryforwards.*
As of December 31, 2025
and 2024, the Company had federal NOL carryforwards of
approximately $7,973,759 and $5,714,370, respectively. Of
the 2025 balance, approximately $4,924,619 relates to pre-2018
vintages subject to the 20-year carryforward period (expiring 20262037), and approximately $3,049,140 relates to post-2017 vintages with indefinite carryforward, subject to the 80% annual taxable
income utilization limit under IRC 172 as amended by TCJA.
The NOL carryforwards are segregated by
vintage year and subject to different expiration and utilization rules as
follows:
Summary Of Operating Loss Carryforwards
|
Tax
Year |
|
NOL Amount |
Expiration |
Applicable
Rules |
|
|
2006 |
$ |
509,749 |
2026 |
Subject to 20-year expiration limit |
|
|
2007 |
$ |
807,208 |
2027 |
Subject to 20-year expiration limit |
|
|
2009 |
$ |
778,247 |
2029 |
Subject to 20-year expiration limit |
|
|
2010 |
$ |
294,973 |
2030 |
Subject to 20-year expiration limit |
|
|
2011 |
$ |
417,724 |
2031 |
Subject to 20-year expiration limit |
|
|
2012 |
$ |
448,045 |
2032 |
Subject to 20-year expiration limit |
|
|
2013 |
$ |
294,807 |
2033 |
Subject to 20-year expiration limit |
|
|
2014 |
$ |
311,759 |
2034 |
Subject to 20-year expiration limit |
|
|
2015 |
$ |
349,180 |
2035 |
Subject to 20-year expiration limit |
|
|
2016 |
$ |
627,123 |
2036 |
Subject to 20-year expiration limit |
|
|
2017 |
$ |
85,804 |
2037 |
Subject to 20-year expiration limit |
|
|
2018 |
$ |
235,550 |
Indefinite |
80% taxable income limit (TCJA 172) |
|
|
2019 |
$ |
83,826 |
Indefinite |
80% taxable income limit (TCJA 172) |
|
|
2020 |
$ |
70,828 |
Indefinite |
80% taxable income limit (TCJA 172) |
|
|
2021 |
$ |
98,362 |
Indefinite |
80% taxable income limit (TCJA 172) |
|
|
2022 |
$ |
57,428 |
Indefinite |
80% taxable income limit (TCJA 172) |
|
|
2023 |
$ |
69,875 |
Indefinite |
80% taxable income limit (TCJA 172) |
|
|
2024 |
$ |
173,882 |
Indefinite |
80% taxable income limit (TCJA 172) |
|
|
2025 |
$ |
2,259,389 |
Indefinite |
80% taxable income limit (TCJA 172) |
|
|
Total |
$ |
7,973,759 |
|
|
|
*IRC 382
Limitations.*****
****
The Company's
ability to utilize NOL carryforwards may be limited under IRC 382 if
cumulative ownership changes exceed 50% within any three-year period. Management
is monitoring for potential ownership changes and will conduct a formal 382
analysis as warranted.
*Valuation
Allowance.*
****
A 100% valuation allowance of $3,323,412
(2025) and $1,330,190 (2024) has been established against net deferred tax assets. The
$1,993,222 increase reflects current-year losses. Management
determined it is more likely than not that the deferred tax assets will not be realized based on the Company's history of cumulative
losses and uncertainty of generating sufficient future taxable income.
*Income Taxes Paid*
In accordance with ASU 2023-09, the following
discloses cash paid for income taxes for the years ended December 31, 2025 and
2024:
Schedule Of Cash Paid For Income Taxes
|
|
|
2025 |
|
|
2024 |
|
|
Cash paid for federal income
taxes |
$ |
|
|
$ |
|
|
|
Cash paid for state
income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total cash paid for income taxes |
$ |
|
|
$ |
|
|
*Uncertain Tax Positions*
****
As of December 31, 2025 and 2024, there
are no material uncertain tax positions requiring recognition. No interest or
penalties related to income taxes have been accrued. Tax years 2022 through
2025 remain open for examination.
|
|
56 |
|
|
|
|
|
**NOTE 9**.**COMMITMENTS
AND CONTINGENCIES**
The Company has no commitments.
**NOTE 10**. **SUBSEQUENT EVENTS**
The Company has evaluated events
through March 31, 2026, the filing date of this Annual ****Report
on Form 10-K and determined that there have been no additional subsequent
events that occurred that would require adjustments to our disclosures in the
financial statements, other than the following:
*IBM Agreement and Cloud
Services*
The
Company entered into an Embedded Solution Agreement with International Business Machines
Corporation ("International Business") for cloud integration in its tennis and
pickleball mobile application. The agreement involves a non-refundable $500,000
commitment for the first year ending January 31, 2027, and a subsequent
$3,300,000 commitment through January 31, 2031, which becomes
non-refundable
unless terminated by December 31, 2026. The Company is also eligible for up to
$250,000 in discretionary cloud credits
for development and testing. The
arrangement includes an initial one-year term with an automatic four-year
renewal, subject to the Company's termination rights, and provides for
technical support and eventual month-to-month continuity.
*Consultant Warrant
Issuance*
On
February 3, 2026, the Company granted a third-party consultant warrants to
purchase up to 200,000 shares of common stock at $5.00 per share, with a
three-year term and cashless exercise rights. These warrants vest in two equal
tranches: 100,000 shares immediately and 100,000 shares on the first
anniversary of the grant.
*Director and Affiliate
Warrant Exercises*
In
early February 2026, two significant warrant exercises were completed on a
cashless basis at an exercise price of $0.397 per share. On February 4, 2026, director
James Askew exercised warrants to purchase 2,269,583 shares of common
stock on
a cashless basis, resulting in the net issuance of 2,097,740 common shares
after the forfeiture of 171,843 shares for the
aggregate exercise price.
Subsequently, on February 6, 2026, Investments AKA, LLC (controlled by Andre Agassi)
exercised warrants to purchase 705,417 shares of common
stock, resulting in the
net issuance of 651,231 common shares after
the forfeiture of 54,186 shares for
the aggregate exercise price.
*Share Issuance*
On February 6,
2026, the Company issued an aggregate of 19,223 shares of common stock of the
Company to an individual upon the conversion (effective December 31, 2024), of
all principal and interest due under a $7,500 convertible promissory note dated
September 30, 2024, held by the individual as of December 31, 2024, and
pursuant to the conversion rights set forth in such convertible promissory
note, including a conversion price of $0.40 per share.
*Subscription Agreements*
On
March 13, 2026, the Company entered into two Subscription Agreements with two
accredited investors (the "2026 Investors"), pursuant to which the 2026
Investors purchased an aggregate of 80,000 shares of restricted common stock
from the Company, for $5.00 per share, or a total of $400,000. The Subscription
Agreements included customary representations and warranties of the Investors
and the Company.
One
of the 2026 Investors was the Boreta Lifetime Trust, whose trustee is Ronald S.
Boreta, the Company's President, Chief Executive Officer and director. The
Boreta Trust purchased 50,000 shares
of restricted common stock for $5.00 per
share or $250,000 in aggregate.
|
|
57 |
|
|
|
|
|
*Employment Agreement*
On
March 25, 2026 and effective on March 1,
2026, we entered into an Executive Employment Agreement with our Chief
Executive Officer and director, Mr. Ronald S. Boreta (the "Employment Agreement"). The Employment Agreement provides for Mr.
Boreta to continue to serve as Chief Executive Officer of the Company for a
five-year term extending through February 28, 2031, provided that the agreement
automatically renews for additional one-year terms thereafter in the event
neither party provides the other at least 60 days prior notice of their
intention not to renew the terms of the Employment Agreement.
The Employment Agreement provides for Mr. Boreta to receive an
annual base salary of $270,000 (the "Base Salary"). The Employment Agreement
also required the Company to (i) pay Mr. Boreta a sign-on bonus of equal to
$250,000 in cash, payable at signing, which
amount
was not paid; and (ii) grant to Mr.
Boreta 300,000 restricted stock units, settleable in shares of common stock,
vesting 1/3 equally on each of December 31, 2026, December 31, 2027, and
December 31, 2028 (the "Restricted Stock Units"). The Restricted Stock Units
and the grant thereof are subject to approval by the Company's Board of
Directors (the "Board"), which the Board expects to approve promptly following
the filing of a contemplated Form S-8 registration statement, subject to the
terms and conditions of an equity compensation plan which was adopted by the
Company and one or more award agreements.
Pursuant to the terms of the Employment Agreement, Mr. Boreta's
annual compensation package includes (1) the Base Salary (described above),
which is subject to automatic 10% annual increases, and
(2)a
discretionary bonus payment to be determined in the sole discretion of the
Board (or the Compensation Committee of the Board, if any) in the targeted
amount of 50% of the Base Salary (the
"Cash Bonus"). Mr. Boreta is also
eligible for discretionary equity bonuses and/or cash awards, from time to time
in the discretion of the Compensation Committee and/or Board of Directors.
*2026 Equity Incentive Plan*
On March 23, 2026, the Board of
Directors adopted the Agassi Sports Entertainment Corp. 2026 Equity Incentive
Plan, which became effective on the same date (the 2026 Plan).
The 2026 Plan provides an
opportunity for any employee, officer, director or consultant of the Company,
subject to limitations provided by federal or state securities laws, to receive
(i)nonqualified stock options; (ii)stock appreciation rights;
(iii)restricted stock awards; (iv)restricted stock units;
(v)shares in performance of services; (vi)other awards of equity or
equity based compensation; or (vii)any combination of the foregoing. In
making such determinations, the Board or Compensation Committee may take into
account the nature of the services rendered by such person, his or her present
and potential contribution to the Companys success, and such other factors as
the Board or Compensation Committee, in its discretion shall deem relevant.
Subject to adjustment in connection with the payment of a
stock dividend, a stock split or subdivision or combination of the shares of
common stock, or a reorganization or reclassification of the Company's common
stock, the aggregate number of shares of common stock which may be issued
pursuant to awards under the 2026 Plan is 1,500,000.****
*Private Placement
Subscription*
On March 30,
2026, the Company entered into a Subscription Agreement with an accredited
investor (the "Investor"), pursuant to which the Investor purchased an
aggregate of 50,000 shares of restricted
common stock from the Company, for
$5.00 per share, or a total of
$250,000. The Subscription
Agreements included
customary representations and warranties of the Investor and the Company. The Subscription
Agreement also provided the Investor three year piggyback registration rights.
Pursuant to a side letter entered into with the Investor at the time of the
subscription, the Investor was also granted demand registration rights, in the
event that the shares purchased by the Investor were not already registered
under the Securities Act or available for sale under Rule 144 one year from the
date of the sale, and we also granted the Investor first opportunity rights
with respect to the sale of pickleball equipment at World Series of Pickleball
events, the specific terms of which will be negotiated in good faith by the
parties and a free basic sponsorship placement in the Company's inaugural World
Series of Pickleball event, which the Company expects to occur next year.
|
|
58 |
|
|
|
|
|
**ITEM 9. CHANGES IN AND DISAGREEMENTS WITH
ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.**
None.
**ITEM 9A. CONTROLS AND PROCEDURES**
*Disclosure controls and procedures*
The Companys Chief Executive Officer (the
principal executive officer) and Chief Financial Officer (the principal
financial/accounting officer) have evaluated the effectiveness of the Companys
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the Exchange Act) as of December 31, 2025. Based upon such evaluation,
the Chief Executive Officer and Chief Financial Officer have concluded that, as
of December 31, 2025, the Companys disclosure controls and procedures were not
effective to provide reasonable assurance that information required to be
disclosed in our reports filed with the Commission pursuant to the Exchange
Act, is recorded properly, processed, summarized and reported within the time
periods specified in the rules and forms of the Commission and that such
information is accumulated and communicated to our management, including our
CEO and CFO, to allow timely decisions regarding required disclosures.
*Managements Annual Report on Internal
Control over Financial Reporting*
The management of the Company is responsible
for the preparation of the financial statements and related financial
information appearing in this Annual Report on Form 10-K. The financial
statements and notes have been prepared in conformity with accounting
principles generally accepted in the United States of America. The management
of the Company is also responsible for establishing and maintaining adequate
internal control over financial reporting, as defined in Rules 13a-15(f) and
15d-15(f) under the Exchange Act. A companys internal control over financial
reporting is defined as a process designed to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted
accounting principles. Our internal control over financial reporting includes
those policies and procedures that:
|
|
|
Pertain to the maintenance of records that in reasonable detail
accurately and fairly reflect the transactions and dispositions of the assets
of the Company; |
|
|
|
|
Provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance with
generally accepted accounting principles, and that receipts and expenditures
of the issuer are being made only in accordance with authorizations of
management and directors of the Company; and |
|
|
|
|
Provide reasonable assurance regarding prevention or timely detection
of unauthorized acquisition, use or disposition of the Companys assets that
could have a material effect on the financial statements. |
|
With the participation of the Chief Executive
Officer (the principal executive officer) and Chief Financial Officer (the principal
financial/accounting officer), our management evaluated the effectiveness of
the Companys internal control over financial reporting as of December 31, 2025,
the end of the period covered by this Report, based upon the framework in
Internal Control Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO 2013). Based on that evaluation,
our management has concluded that our internal control over financial reporting
was not effective as of December 31, 2025. Specifically our management determined that, as of December 31, 2025, we
did not have sufficient personnel to allow segregation of duties to ensure the
completeness or accuracy of our information. Due to the size of the Company and
its limited operations, we are unable to remediate this deficiency until we add
additional personnel or acquire or merge with another company.
This annual report does not include an attestation
report of our registered public accounting firm regarding internal control over
financial reporting. Managements report was not subject to attestation by our
registered public accounting firm pursuant to rules of the SEC that permit us
to provide only managements report in this annual report. On July 21, 2010,
President Obama signed the Dodd-Frank Wall Street Reform and Consumer
Protection Act. Included in the Act is a provision that permanently exempts
smaller public companies that qualify as either a Non-Accelerated Filer or
Smaller Reporting Company from the auditor attestation requirement of Section
404(b) of the Sarbanes-Oxley Act of 2002.
|
|
59 |
|
|
|
|
|
**
*Changes in Internal Control over Financial
Reporting*
There have been no changes in our internal control
over financial reporting during the quarter ended December 31, 2025, that have
materially affected, or are reasonably likely to materially affect, our
internal control over financial reporting.
*Limitations on the Effectiveness of Controls*
The Companys disclosure controls and
procedures are designed to provide the Companys Chief Executive Officer and
Chief Financial Officer with reasonable assurances that the Companys
disclosure controls and procedures will achieve their objectives. However, the
Companys management does not expect that the Companys disclosure controls and
procedures or the Companys internal control over financial reporting can or
will prevent all human error. A control system, no matter how well designed and
implemented, can provide only reasonable, not absolute, assurance that the
objectives of the control system are met. Furthermore, the design of a control
system must reflect the fact that there are internal resource constraints, and
the benefit of controls must be weighed relative to their corresponding costs.
Because of the limitations in all control systems, no evaluation of controls
can provide complete assurance that all control issues and instances of error,
if any, within the Company are detected. These inherent limitations include the
realities that judgments in decision-making can be faulty, and that breakdowns
can occur due to human error or mistake. Additionally, controls, no matter how
well designed, could be circumvented by the individual acts of specific persons
within the organization. The design of any system of controls is also based in
part upon certain assumptions about the likelihood of future events, and there
can be no assurance that any design will succeed in achieving its stated
objectives under all potential future conditions.
**ITEM 9B. OTHER INFORMATION**
*(a)*The below events
occurred within four business days of the filing date of this Annual Report and
as such, the Company is disclosing the occurrence of the events below under *Item
3.02 Unregistered Sales of Equity Securities*, instead of a
stand-alone Current Report on Form 8-K:
**Item
3.02. Unregistered Sales of Equity Securities.**
*Private
Placement Subscription*
On March 30,
2026, the Company entered into a Subscription Agreement with an accredited
investor (the Investor), pursuant to which the Investor purchased an
aggregate of 50,000 shares of restricted common stock from the Company, for
$5.00 per share, or a total of $250,000. The Subscription Agreements included
customary representations and warranties of the Investor and the Company. The
Subscription Agreement also provided the Investor three year piggyback
registration rights. Pursuant to a side letter entered into with the Investor
at the time of the subscription, the Investor was also granted demand
registration rights, in the event that the shares purchased by the Investor
were not already registered under the Securities Act or available for sale
under Rule 144 one year from the date of the sale, and we also granted the
Investor first opportunity rights with respect to the sale of pickleball equipment
at World Series of Pickleball events, the specific terms of which will be
negotiated in good faith by the parties and
a
free basic sponsorship placement in the Companys inaugural World Series of
Pickleball event, which the Company expects to occur next year.
The Company claims
an exemption from registration for the issuance of the shares to the Investor
pursuant to Section 4(a)(2) and/or Rule 506 of Regulation D of the Securities
Act, since the offer and sale of such shares did not involve a public offering and
the recipient was an accredited investor and had access to similar
information as would be included in a registration statement under the
Securities Act. The securities were offered without any general solicitation by
us or our representatives. The securities offered have not been registered
under the Securities Act and may not be offered or sold in the United States
without registration or an applicable exemption from the registration
requirements of the Securities Act. No sales commissions were paid in
connection with the sales of these securities.
|
|
60 |
|
|
|
|
|
*(b) Rule 10b5-1 Trading Plans.*During
the quarter ended December 31, 2025, none of the Company's directors or officers (as defined in Rule 16a-1(f))
adopted
or
terminated
any contract, instruction or
written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule
10b5-1(c) or any "non-Rule 10b5-1 trading arrangement."
**ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS
THAT PREVENT INSPECTIONS**
Not applicable.
|
|
61 |
|
|
|
|
|
**PART III**
**ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND
CORPORATE GOVERNANCE**
**Information about our
Executive Officer and Directors**
|
Name |
|
Age |
|
Position |
|
Date FirstAppointedas aDirector |
|
|
|
|
|
|
|
|
|
|
|
Ronald S. Boreta |
|
63 |
|
President, Chief Executive Officer,Secretary and Director |
|
March 1984 |
|
|
Shawn Cable |
|
53 |
|
Chief Financial Officer |
|
- |
|
|
James Askew |
|
61 |
|
Director |
|
October 2024 |
|
Our directors are elected
annually (or as often as we hold meetings of stockholders) and will hold office
until our next annual meeting of the stockholders and until their successors
are elected and qualified. Officers hold their positions at the pleasure of the
Board of Directors, absent any employment agreement. Our officers and directors
may receive compensation as determined by us from time to time by vote of the
Board of Directors. Such compensation might be in the form of equity or cash.
Directors may be reimbursed by the Company for expenses incurred in attending
meetings of the Board of Directors. Vacancies in the Board are filled by
majority vote of the remaining directors.
The business experience of our
officers and directors is as follows:
**Ronald S. Boreta, President, Chief
Executive Officer, Secretary and Director**
Ronald S. Boreta has served as
President of the Company since 1992, Chief Executive officer (Principal
Executive Officer) since August 1994, Principal Financial Officer from February
2004 through March 2025, and a Director since its inception in 1984. The
Company employed him from its inception in March 1984, with the exception of a
6-month period in 1985 when he was employed by a franchisee of the Company
located in San Francisco, California, until June 2016 when the Company
transferred its interests in AAGC. Since
that time he has been employed by AAGC as its President. Prior to his employment by the Company, Mr.
Boreta was an assistant golf professional at San Jose Municipal Golf Course in
San Jose, California.
Mr. Boreta currently devotes approximately
90% of his time to the business of the Company.
Ronald S. Boreta was selected to be a Director of the Company because of
his long experience with the Company and because he has served as its sole
executive officer for many years.
**Shawn Cable, Chief Financial Officer**
Mr. Cable has served as the Chief Financial
Officer for both the Andre Agassi Foundation for Education, a 501 (c)(3)
not-for-profit, private charity, an educational organization dedicated to
transforming U.S. public education for underserved youth (the Agassi
Foundation) and Agassi Enterprises Inc. (Agassi Enterprises)
since 2008, and has also served as Secretary and Director of Agassi Enterprises
since October 2009 and Treasurer of the Agassi Foundation since October 2009.
Mr. Cable also currently serves as Chief Financial Officer of Blueprint Sports
& Entertainment LLC, which provides software and services to Athletic
Departments and Conferences, which position he has held since October 2022.
Prior to that, Mr. Cable worked for Syncon
Homes, a regional real estate developer focused on residential homebuilding,
commercial & golf course properties, where he was the Corporate Controller
for all divisions. His primary responsibilities were financial reporting,
project analysis and working with government agencies. Before Syncon Homes, Mr.
Cable worked for a number of both publicly-held and private real estate
development companies focused on residential and commercial development
throughout the United States.
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Mr. Cable earned his Bachelor of Science
degree in Business Administration (Finance) from the University of Nevada, Las
Vegas (UNLV) in 1995 and in 2000, earned his Masters in Business
Administration, from UNLV.
**James Askew, Director**
****
Since October 2024, Mr. Askew has
served as a director of the Company and Mr. Askew served as an advisor to the
Company prior thereto since 2020. Mr. Askew has been a co-founder of
Verde Clean Fuels (Nasdaq:VGAS) since August 2020. Mr. Askew has been an
entrepreneur, investor, and capital markets advisor to various companies,
primarily in the energy industry, with assets and operations in numerous
jurisdictions throughout Africa and The Americas for more than thirty
years. Based upon his qualifications,
Mr. Askew is considered qualified to work as a Director of the Company.
****
**Board Leadership Structure**
Our Board of Directors has the
responsibility for selecting the appropriate leadership structure for the
Company. In making leadership structure determinations, the Board of Directors
considers many factors, including the specific needs of the business and what
is in the best interests of the Companys stockholders.
**Risk Oversight**
Effective risk oversight is an
important priority of the Board of Directors. Because risks are considered in
virtually every business decision, the Board of Directors discusses risk
throughout the year generally or in connection with specific proposed actions.
The Board of Directors approach to risk oversight includes understanding the
critical risks in the Companys business and strategy, evaluating the Companys
risk management processes, allocating responsibilities for risk oversight, and
fostering an appropriate culture of integrity and compliance with legal
responsibilities. The directors exercise direct oversight of strategic risks to
the Company.
**Arrangements between Officers and
Directors**
To our knowledge, there are no
arrangements or understandings between our officers and directors and any other
person pursuant to which our officers or directors were selected to serve as an
officer or director of the Company.
**Other Directorships**
No director of the Company is
also a director of issuers with a class of securities registered under Section
12 of the Exchange Act (or which otherwise are required to file periodic reports
under the Exchange Act).
**Involvement in Certain Legal Proceedings**
Our officers and directors were
not involved in any of the following during the past ten years: (1) any
bankruptcy petition filed by or against any business of which such person was a
general partner or executive officer either at the time of the bankruptcy or
within two years prior to that time; (2) any conviction in a criminal
proceeding or being a named subject to a pending criminal proceeding (excluding
traffic violations and other minor offenses); (3) being subject to any order,
judgment, or decree, not subsequently reversed, suspended or vacated, of any
court of competent jurisdiction, permanently or temporarily enjoining, barring,
suspending or otherwise limiting his involvement in any type of business,
securities or banking activities; (4) being found by a court of competent
jurisdiction (in a civil action), the SEC or the Commodities Futures Trading
Commission to have violated a federal or state securities or commodities law, (5)
being the subject of, or a party to, any Federal or State judicial or
administrative order, judgment, decree, or finding, not subsequently reversed,
suspended or vacated, relating to an alleged violation of (i) any Federal or
State securities or commodities law or regulation; (ii) any law or regulation
respecting financial institutions or insurance companies including, but not
limited to, a temporary or permanent injunction, order of disgorgement or
restitution, civil money penalty or temporary or permanent cease-and-desist
order, or removal or prohibition order; or (iii) any law or regulation
prohibiting mail or wire fraud or fraud in connection with any business entity;
or (6) being the subject of, or a party to, any sanction or order, not
subsequently reversed, suspended or vacated, of any self-regulatory
organization (as defined in Section 3(a)(26) of the Exchange Act), any
registered entity (as defined in Section 1(a)(29) of the Commodity Exchange
Act), or any equivalent exchange, association, entity or organization that has
disciplinary authority over its members or persons associated with a member.
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**Committees of the Board**
Our Company currently does not have nominating,
compensation or audit committees or committees performing similar functions, nor
does our Company have a written nominating, compensation or audit committee
charter. Our directors believe that it is not necessary to have such
committees, at this time, because the functions of such committees can be
adequately performed by our Board of Directors.
Our Company does not have any
defined policy or procedural requirements for stockholders to submit
recommendations or nominations for directors. Our directors believe that, given
the stage of our development, a specific nominating policy would be premature
and of little assistance until our business operations develop to a more
advanced level. Our Company does not currently have any specific or minimum
criteria for the election of nominees to the Board of Directors and we do not
have any specific process or procedure for evaluating such nominees. The Board
of Directorswill assess all candidates, whether submitted by management
or stockholders, and make recommendations for election or appointment.
**Stockholder Communications with
the Board**
A stockholder who wishes to communicate with our Board of
Directorsmay do so by directing a written request addressed toour
Secretary, 1120 N Town Center Drive, Suite 160, Las Vegas Nevada 89144, who,
upon receipt of any communication other than one that is clearly marked Confidential,
will note the date the communication was received, open the communication, make
a copy of it for our files and promptly forward the communication to the
director(s) to whom it is addressed. Upon receipt of any communication that is
clearly marked Confidential, our Secretary will not open the
communication, but will note the date the communication was received and
promptly forward the communication to the director(s) to whom it is addressed.
**Corporate Governance**
The Company promotes
accountability for adherence to honest and ethical conduct and strives to be
compliant with applicable governmental laws, rules and regulations.
In lieu of an Audit Committee,
the Companys Board of Directors is responsible for reviewing and making
recommendations concerning the selection of outside auditors, reviewing the
scope, results and effectiveness of the annual audit of the Companys financial
statements and other services provided by the Companys independent public
accountants. The Board of Directors reviews the Companys internal accounting
controls, practices and policies.
**Director Independence**
Our common stock is currently
quoted on the OTCID, maintained by OTC Markets. The OTCID does not require us
to have independent members of our Board of Directors.
As described above, we do not
currently have a separately designated audit, nominating or compensation
committee.
**Code of Ethics**
We have adopted a Code of Ethics.
The Code of Ethics applies to all officers, directors and employees and
includes compliance and reporting requirements, and procedures for conflicts of
interest.
We intend to disclose any
amendments or future amendments to our Code of Ethics and any waivers with
respect to our Code of Ethics granted to our principal executive officer, our
principal financial officer, or any of our other employees performing similar
functions on our corporate website within four business days after the
amendment or waiver. In such case, the disclosure regarding the amendment or
waiver will remain available on our website for at least 12 months after the
initial disclosure. There have been no waivers granted with respect to our Code
of Ethics to any such officers or employees to date.
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**Board of Directors Meetings**
During the year ending December 31, 2025, the Board held no
formal meetings. The Company has not held an annual meeting in the last five
years.
**Policy on Equity Ownership**
The Company does not have a
policy on equity ownership at this time.
**Insider Trading/Policy Against Hedging**
The Company recognizes that
hedging against losses in Company shares may disturb the alignment between
stockholders and executives that equity awards are intended to build; however,
while short sales are discouraged by the Company, the Company does not
currently have a policy prohibiting such transactions or any formal insider
trading policy.
The Company has not adopted a
formal insider trading policy governing the purchase, sale and other
dispositions of the Companys securities that applies to the Company personnel
that is reasonably designed to promote compliance with insider trading laws and
applicable listing standards. The Company believes that due to its current
limited number of officers, directors and employees, such policies are not currently
necessary. However, in the future, the Company plans to adopt policies and
procedures governing the purchase, sale and/or other dispositions of its securities
by directors, officers and employees that are reasonably designed to promote
compliance with insider trading laws and applicable listing standards, if any.
Additionally, the Company plans to follow procedures for the repurchase of any
shares of its securities which will be reasonably designed to promote
compliance with insider trading laws and applicable listing standards, if any.
**Policy
on Timing of Award Grants**
****
The
Board has not established policies and practices (whether written or otherwise) regarding the timing of option grants or other
awards in relation to the release of material nonpublic information (MNPI) anddoes not plan to take MNPI into
account when determining the timing and terms of stock option or other equity awards to executive officers.The Company does not
time the disclosure of MNPI,whether positive or negative, for the purpose of affecting the value of executive
compensation.
**Dodd-Frank Wall Street Reform and
Consumer Protection Act of 2010 (Dodd-Frank)**
Dodd-Frank requires public
companies to provide shareholders with an advisory vote on compensation of the
most highly compensated executives, which are sometimes referred to as say
on pay, as well as an advisory vote on how often the company will present
say on pay votes to its shareholders. The Company plans to provide its
shareholders the right to vote on say-on-pay matters beginning at the next
annual meeting of stockholders which the Company holds after this filing.
**Compensation Recovery and
Clawback Policies**
Under the Sarbanes-Oxley Act
of
2002 (the "Sarbanes-Oxley Act"), in the event of misconduct that results
in a financial restatement that would have reduced a previously paid incentive
amount, we can recoup those improper payments from our Chief Executive Officer
and Chief Financial Officer (if any). The SEC also recently adopted rules which
direct national stock exchanges to require listed companies to implement
policies intended to recoup bonuses paid to executives if the company is found
to have misstated its financial results. We plan to implement a clawback policy
in the future, if required, although we have not yet implemented such policy
and are not yet required to.
**Delinquent Section 16(a) Reports**
Section 16(a) of the Exchange Act
requires our executive officers and directors and persons who beneficially own
more than 10% of our common stock to file reports of their ownership of, and
transactions in, our common stock with the SEC and to furnish us with copies of
the reports they file. Based solely upon our review of the Section 16(a)
filings that have been furnished to us, we believe that all required Section
16(a) were timely filed during fiscal 2025, except that John Boreta, a former
greater than 10% stockholder inadvertently failed to timely report two
transactions and as a result one Form 4 was not timely filed, Shawn Cable, our
Chief Financial Officer, inadvertently failed to timely report one transaction
and as a result one Form 4 was not timely filed, and Andre Agassi, a greater
than 10% stockholder inadvertently failed to timely report one transaction and
as a result one Form 4 was not timely filed.
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**ITEM 11. EXECUTIVE COMPENSATION**
The following table sets forth information concerning the
compensation of (i) all individuals serving as our principal executive officer
or acting in a similar capacity during the last completed fiscal year (PEO),
regardless of compensation level; (ii) our two most highly compensated
executive officers other than the PEO who were serving as executive officers at
the end of the last completed fiscal year, if any; and (iii) up to two
additional individuals for whom disclosure would have been provided pursuant to
paragraph (ii) but for the fact that the individual was not serving as an
executive officer at the end of the last completed fiscal year (collectively,
the Named Executive Officers).
**Summary Compensation Table**
|
Name andPrincipalPosition |
Year |
|
Salary($) |
|
Bonus($) |
|
StockAwards($) |
OptionAwards($) |
|
All Other Compen-Sation($) |
|
Total($) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ronald S. Boreta, President, Chief Executive Officer, and Director |
2025 |
$ |
230,769 |
$ |
29,899 |
|
|
|
$ |
|
$ |
260,668 |
|
|
|
2024 |
$ |
40,000 |
$ |
|
|
|
|
$ |
|
$ |
40,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shawn Cable,Chief Financial Officer(1) |
2025 |
$ |
58,269 |
|
8,589 |
|
|
169,503 |
|
|
|
236,361 |
|
|
* |
Does not include perquisites and other personal benefits, or property, unless the aggregate amount of such compensation is more than $10,000. No executive officer earned any non-equity incentive plan compensation or nonqualified deferred compensation during the periods reported above. Option Awards represent the aggregate grant date fair value of awards computed in accordance with Financial Accounting Standards Board Accounting Standard Codification Topic 718. For additional information on the valuation assumptions with respect to the awards, refer to Note 6 to the audited financial statements included in this Annual Report. No executive officer serving as a director received any compensation for services on the Board of Directors separate from the compensation paid as an executive for the periods above. |
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(1) |
Effective on March 6, 2025, the Board of Directors of the Company, appointed Shawn Cable as the Chief Financial Officer (Principal Accounting/Financial Officer) of the Company (the Appointment), which Appointment was effective as of the same date. |
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(2) |
In connection with his appointment as Chief Financial Officer of the Company on March 6, 2025, the Company agreed to pay Mr. Cable $75,000 per year, and to grant Mr. Cable warrants to purchase 100,000 shares of common stock with an exercise price of $1.70 per share and a term of five years. The warrants vested immediately and were exercisable 1/2 on March 6, 2025 and 1/2 on September 6, 2025. |
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We do not provide our officers or
employees with pension, stock appreciation rights, long-term incentive, profit
sharing, retirement or other plans, although we may adopt one or more of such
plans in the future.
**Employment
Agreements; Outstanding Equity Awards; Key Man Insurance**
**Employment Agreements**
The Company does not have any written employment agreements
in place with any of its executive officers, other than Mr. Boreta, as
discussed below. The Board of Directors, reserves the right to increase the salaries
of our officer(s), and/or to grant them equity awards, including stock, options
or other equity securities, from time to time, as additional compensation or
bonuses.
*Employment Agreement with Ronald S. Boreta, Chief Executive
Officer, President, Secretary and Director*
On March
25, 2026 and effective on March 1,
2026, we entered into an Executive Employment Agreement with our Chief
Executive Officer and director, Mr. Ronald S. Boreta (the Employment
Agreement). The Employment
Agreement provides for Mr. Boreta to continue to serve as Chief Executive
Officer of the Company for a five-year term extending through February 28,
2031, provided that the agreement automatically renews for additional one-year
terms thereafter in the event neither party provides the other at least 60 days
prior notice of their intention not to renew the terms of the Employment
Agreement.
The Employment Agreement provides for Mr. Boreta to receive
an annual base salary of $270,000 (the Base Salary). The Employment
Agreement also required the Company to (i) pay Mr. Boreta a sign-on bonus of
equal to $250,000 in cash, payable at signing, which amount
was not paid; and (ii) grant to Mr.
Boreta 300,000 restricted stock units, settleable in shares of common stock,
vesting 1/3 equally on each of December 31, 2026, December 31, 2027, and
December 31, 2028 (the Restricted Stock Units). The Restricted Stock
Units and the grant thereof are subject to approval by the Companys Board of
Directors (the Board), which the Board expects to approve promptly following
the filing of a contemplated Form S-8 registration statement, subject to the
terms and conditions of an equity compensation plan which was adopted by the
Company and one or more award agreements, and as such, the Restricted Stock
Units have not been granted to date.
Pursuant to the terms of the Employment Agreement, Mr.
Boretas annual compensation package includes (1) the Base Salary (described
above), which is subject to automatic 10% annual increases, and (2)a
discretionary bonus payment to be determined in the sole discretion of the
Board (or the Compensation Committee of the Board, if any) in the targeted
amount of 50% of the Base Salary (the Cash Bonus). Mr. Boreta is also
eligible for discretionary equity bonuses and/or cash awards, from time to time
in the discretion of the Compensation Committee and/or Board of Directors.
Mr. Boretas compensation under the Employment Agreement
may be increased from time to time, by the Board (or the Compensation Committee
of the Board, if any), which increases do not require the entry into an amended
employment agreement.
The Employment Agreement prohibits Mr. Boreta from
competing against us during the term of the agreement and for a period of
twelve months after the termination of the agreement in any state and any other
geographic area in which we or our subsidiaries provide Restricted Services or
Restricted Products, directly or indirectly, during the twelve months preceding
the date of the termination of the agreement. Restricted Products
means any product that the Company or any of its subsidiaries has provided or
is developing, manufacturing, distributing, selling and/or providing at any
time during the term of the Agreement, or which he obtained any trade secret or
other confidential information about at any time during the term, or which he
became aware of as a result of services rendered under the Employment
Agreement. Restricted Services means any services that the Company or
any of its subsidiaries has provided or is developing, performing and/or
providing at any time during the term of the agreement, or which he obtained any
trade secret or other confidential information about at any time during the
term, or which he became aware of as a result of services rendered under the
Employment Agreement. The non-compete requirements described in the paragraph
above, as well as the restriction on Mr. Boreta to refrain, for a period of
twelve months from the termination date, from soliciting customers of the
Company with whom Mr. Boreta worked or had access to the confidential information
pertaining to the Companys business with such customer during the last year of
Mr. Boretas employment with the Company and from soliciting employees of the
Company to leave the employment of the Company, are defined as the Non-Compete
Provisions.
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We may terminate Mr. Boretas Employment Agreement (a) for
cause which means (i) that Mr. Boreta has materially breached any obligation,
duty, covenant or agreement under the agreement, which breach is not cured or
corrected within thirty days of written notice thereof from the Company (except
for breaches of the assignment of inventions or
confidentiality/non-solicitation and non-compete provisions of the agreement,
which cannot be cured and for which the Company need not give any opportunity
to cure); (ii) Mr.
Boretas willful failure or refusal to perform or nonperformance of his duties
without a reasonable basis for him to do so, subject to a 30-day notice and
cure period; (iii) gross negligence or willful misconduct of Mr. Boreta with
regard to the Company or any of its subsidiaries resulting in a material
economic loss to the Company or material damage to the Companys reputation or
business relationships; (iv) if Mr. Boreta commits any act of misappropriation
of funds or embezzlement as determined in the reasonable determination of the
Board (not to be subject to a cure period); (v) if Mr. Boreta commits any act
of fraud as determined in the reasonable determination of the Board (not
subject to a cure period); or (vi) if Mr. Boreta is convicted of, or pleads
guilty or nolo contendere with respect to, theft, fraud, a crime involving
moral turpitude, or a felony under federal or applicable state law and such
offense casts reasonable doubt on Mr. Boretas ability to perform his duties
going forward; (b) in the event Mr. Boreta suffers a physical or mental
disability which, in
the reasonable judgment of the Board, renders him unable to perform his duties
and obligations for either 90 consecutive days or 180 days in any 12-month
period; (c) for any reason without cause; or (d) upon expiration of the
initial term of the agreement (or any renewal) upon notice as provided above.
The agreement also automatically terminates upon the death of Mr. Boreta.
Mr. Boreta may terminate his
employment (a) for good reason if there is (i) a material diminution in his
authority, duties, or responsibilities; (ii) a material diminution in the
authority, duties, or responsibilities or a requirement that Mr. Boreta report
to an officer or employee of the Company rather than reporting to the Board;
(iii) a material breach by the Company of the agreement, or (iv) a material
diminution in Mr. Boretas Base Salary, in each case without his prior written
consent; provided, however, prior to any such termination by Mr. Boreta for
good reason, Mr. Boreta must first advise us in writing (within 90 days of
the occurrence of such event) and provide us 30 days to cure, after which in
the event we do not cure the issue leading to such good reason notice, Mr.
Boreta has 30 days to resign for good reason); (b) for any reason without good
reason; and (c) upon expiration of the initial term of the Employment
Agreement (or any renewal) upon notice as provided above.
If Mr. Boretas employment is
terminated due to his death or disability, Mr. Boreta or his estate is entitled
to a lump sum cash severance payment equal to the sum of (i) Mr. Boretas Base
Salary accrued through the termination date; (ii) any unpaid Cash Bonus for the
prior year that would have been paid had Mr. Boreta not been terminated prior
to such payment; and (iii) the pro rata amount of the current years targeted
bonus, multiplied by the number of days in such year preceding the termination
date divided by 365. Additionally, and notwithstanding anything to the contrary
in any equity agreement, any unvested stock options or equity compensation held
by Mr. Boreta upon such termination shall vest and shall be exercisable until
the earlier of (A) ninety days from the date of termination and (B) the latest
date upon which such stock options or equity would have expired by their
original terms under any circumstances.
If Mr. Boretas employment is
terminated by Mr. Boreta without good reason or his non-renewal of the
agreement, or by non-renewal by the Company, by the Company with cause or the
Companys non-renewal of the agreement, Mr. Boreta is entitled to his Base
Salary accrued through the termination date and no other benefits other than
continuation of health insurance benefits on the terms and to the extent
required by COBRA, or such other similar law or regulation as may be applicable
to Mr. Boreta or the Company with respect to Mr. Boreta. Additionally, any
unvested stock options or equity compensation held by Mr. Boreta shall
immediately terminate and be forfeited (unless otherwise provided in the
applicable award) and any previously vested stock options (or if applicable
equity compensation) shall be subject to terms and conditions set forth in the
applicable equity agreement, as such may describe the rights and obligations
upon termination of employment of Mr. Boreta.
If Mr. Boretas employment is
terminated by Mr. Boreta for good reason, or by the Company without cause,
(a) Mr. Boreta is entitled to his Base Salary accrued through the termination
date and any unpaid Cash Bonus for the prior completed calendar year that would
have been paid had Mr. Boreta not been terminated prior to such payment, plus a
lump sum cash severance payment equal to (x) the sum of (i) an amount equal to
three times his current annual Base Salary; plus (ii) an amount equal to his
targeted bonus for the year containing the termination date (the Severance
Payment); and (b) provided Mr. Boreta elects to receive continued health
insurance coverage through COBRA, the Company will pay Mr. Boretas monthly
COBRA contributions for health insurance coverage, as may be amended from time
to time (less an amount equal to the premium contribution paid by active
Company employees, if any) for twelve months following the termination date
(the Health Payment); provided, however, that if at any time Mr.
Boreta is covered by a substantially similar level of health insurance through
subsequent employment or otherwise, the Companys health benefit obligations
shall immediately cease, and the Company shall have no further obligation to
make the Health Payment. Additionally, and notwithstanding anything to the
contrary in any equity agreement, any unvested stock options or equity
compensation previously granted to Mr. Boreta will vest immediately upon such
termination and shall be exercisable by Mr. Boreta until the earlier of (A)
ninety (90) days from the date of termination and (B) the latest date upon
which such stock options or equity would have expired by their original terms
under any circumstances.
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As a condition to Mr. Boretas
right to receive any Severance Payment, (A) Mr. Boreta must execute and deliver
to the Company a written release in form and substance satisfactory to the
Company, of any and all claims against the Company and all directors and
officers of the Company with respect to all matters arising out of Mr. Boretas
employment, or the termination thereof (other than claims for entitlements
under the terms of the agreement or plans or programs of the Company in which
Mr. Boreta has accrued a benefit), which must be effective by the 90th day
following his termination date; and (B) Mr. Boreta must not have breached any
of his covenants and agreements under the Agreement relating to assignment of
inventions and confidentiality, including the non-solicitation and non-compete
provisions thereof, which shall continue following the termination date.
If a change of control of the
Company occurs during the term of the Employment Agreement or within 30 days
after Mr. Boretas termination of employment by Mr. Boreta for good reason, by
the Company without cause, or as a result of non-renewal by the Company, the
Company will pay Mr. Boreta a cash payment in a lump sum in an amount equal to
(x) minus (y) where (x) equals 3.0 times the sum of (a) the most recent annual
Base Salary of Mr. Boreta; and (b) the amount of the most recent Cash Bonus
paid to Mr. Boreta pursuant to the Employment Agreement (or the targeted bonus,
if no cash award was made prior to termination) and (y) equals the amount of
any Severance Payment previously paid to Mr. Boreta pursuant to the Employment
Agreement.
The Employment Agreement also
contains standard assignment of inventions, indemnification and confidentiality
provisions. Further, Mr. Boreta is subject to non-solicitation covenants during
the term of the agreement.
Although Mr. Boreta will be
prohibited from competing with us while he is employed with us, he will only be
prohibited from competing for twelve months after her
employment with us ends pursuant to her
employment agreement. Accordingly, Mr. Boreta could be in a position to use
industry experience gained while working with us to compete with us.
*Compensation of Shawn Cable, Chief Financial Officer*
In connection with his appointment as Chief
Financial Officer of the Company on March 6, 2025, the Company agreed to pay
Mr.Cable$75,000 per
year, and to grant Mr.Cablewarrants
to purchase 100,000 shares of common stock with an exercise price of $1.70 per
share and a term of five years. The warrants vested immediately and were
exercisable 1/2 on March 6, 2025 and 1/2 on September 6, 2025 (the CFO
Warrants). The CFO Warrants also allow for cashless exercises and customary
anti-dilution rights for stock splits, dividends and similar transactions.
**Outstanding Equity Awards at
Fiscal Year-End**
|
Name |
Option awards |
|
|
Number of securities underlying
unexercised options
(#) exercisable |
Number of securities
underlying
unexercised
options
(#) unexercisable |
Option
exercise price
($) |
Option expiration date |
|
|
Ronald S. Boreta |
|
|
|
|
|
|
|
|
|
|
|
|
|
Shawn Cable |
100,000* |
|
$1.70 |
March 6, 2030 |
|
* Warrants to
purchase shares of common stock. All warrants have been earned.
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**Key Man Insurance**
The Company does not hold Key
Man life insurance on any of its officers or directors.
**Non-Executive Director
Compensation Table**
The following table sets forth
compensation information with respect to our non-executive directors during our
fiscal year ended December 30, 2025.
|
Name |
|
Fees Earned or Paid inCash ($)* |
|
|
StockAwards ($) |
|
|
All Other Compensation ($) |
|
|
Total ($) |
|
|
|
James Askew |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
|
Steve Miller(1) |
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
$ |
|
|
|
* The table above does not
include the amount of any expense reimbursements paid to the above directors.
No directors received any Non-Equity Incentive Plan Compensation, Option Awards
or Nonqualified Deferred Compensation. Does not include perquisites and other
personal benefits, or property, unless the aggregate amount of such
compensation is more than $10,000.
(1) Mr. Miller passed away on
June 15, 2025.
**ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
AND RELATED STOCKHOLDER MATTERS**
The following table presents certain
information regarding the beneficial ownership of all shares of common stock as
ofMarch 27, 2026(the Date of Determination)by (i) each
person who owns beneficially more than five percent (5%) of the outstanding
shares of common stock based on 12,633,250 shares outstanding as ofthe Date of Determination, (ii) each
of our directors, (iii) each named executive officer, and (iv) all directors
and officers as a group. Except as otherwise indicated, all shares are owned
directly.
Beneficial ownership is
determined in accordance with the rules of the Securities and Exchange Commission
and includes voting and/or investing power with respect to securities. We
believe that, except as otherwise noted and subject to applicable community
property laws, each person named in the following table has sole investment and
voting power with respect to the shares of common stock shown as beneficially
owned by such person. Additionally, shares of common stock subject to options,
warrants or other convertible securities that are currently exercisable or
convertible, or exercisable or convertible within 60 days ofthe Date of
Determination,are deemed to be outstanding and to be beneficially owned
by the person or group holding such options, warrants or other convertible
securities for the purpose of computing the percentage ownership of such person
or group, but are not treated as outstanding for the purpose of computing the
percentage ownership of any other person or group.
We believe that, except as
otherwise noted and subject to applicable community property laws, each person
named in the following table has sole investment and voting power with respect
to the shares of common stock shown as beneficially owned by such person.
Unless otherwise indicated, the address for each of the officers or directors
listed in the table below is 6730 South Las Vegas Boulevard, Las Vegas, Nevada
89119.
|
|
70 |
|
|
|
|
|
|
Name of
Beneficial Owner |
|
|
Number of
Common Stock Shares Beneficially Owned |
|
|
Percent Beneficial Ownership |
|
|
|
Directors,
Named Executive Officers and Executive Officers |
|
|
|
|
|
|
|
|
|
|
|
Ronald S. Boreta |
|
|
|
2,509,403 |
(1) |
|
|
19.9 |
% |
|
|
Shawn Cable |
|
|
|
102,000 |
(2) |
|
|
* |
% |
|
|
James M. Askew |
|
|
|
2,097,860 |
|
|
|
16.6 |
% |
|
|
All
executive officers and directors as a group
(3 persons) |
|
|
|
4,367,443 |
(1)(2) |
|
|
29.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Greater than
5% Stockholders |
|
|
|
|
|
|
|
|
|
|
|
Andre Agassi(3) |
|
|
|
3,240,398 |
(3) |
|
|
23.8 |
% |
|
|
Nathan Low(4) |
|
|
|
789,450 |
|
|
|
6.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
* Less than 1%.
|
(1) |
Includes (i) 602,229 shares of common stock held individually by
Ronald S. Boreta; (ii) 360,784 shares of common stock held by Boreta
Enterprises, Ltd (Enterprises), of which Ronald S. Boreta is
Managing Member and Chief Executive Officer; (iii) 1,495,390 shares of common
stock held by All-American Golf Center, Inc. (AAGC), of which Ronald
S. Boreta is a director and President ; and (iv) 51,000 shares of common
stock held by Boreta Lifetime Trust, of which Mr. Boreta is the trustee. Due
to the above, Ronald S. Boreta may be deemed to share voting and dispositive
control over the securities held by Enterprises, AAGC, and the Boreta
Lifetime Trust. Ronald S. Boreta disclaims beneficial ownership of the
securities held by Enterprises, AAGC, and the Boreta Lifetime Trust, except
to the extent of his pecuniary interest therein. |
|
|
(2) |
Includes warrants to purchase 100,000 shares of common stock with an
exercise price of $1.70 per share, which have a
term through March 6, 2030. |
|
|
|
|
|
|
(3) |
Address: 1120 N. Town Center Drive, Suite 160, Las Vegas, Nevada
89144. Investments AKA, LLC (Investments AKA) is owned and managed
by Agassi Ventures, LLC (Agassi Ventures); Agassi Ventures is owned
by The Andre Agassi Trust and managed by Andre Agassi; The Andre Agassi Trust
(the Agassi Trust) is a trust created by Andre Agassi, who serves as
its trustee; and Andre Agassi is an individual. ASI Group, LLC (ASI Group)
is managed by AKA Four, LLC (AKA Four) which is managed by Agassi
Ventures, which is managed by Andre Agassi. Investments AKA owns 100% of ASI
Group. Agassi Ventures, Andre Trust and Andre Agassi own directly no shares
of common stock. The Agassi Trust, which owns all of the interests in Agassi
Ventures, may be deemed to share voting and dispositive power with respect to
1,603,354 shares of common stock held directly by Investments AKA and the
637,044 shares of common stock held directly by ASI Group. Andre Agassi, who
is the manager of Agassi Ventures, may be deemed to share voting and
dispositive power with respect to the 1,603,354 shares of common stock held
directly by Investments AKA and the 637,044 shares of common stock held
directly by ASI Group. All information included in this footnote above, and
footnote (4), below, comes from the Schedule 13D/A filed with the SEC by Mr.
Agassi, Agassi Ventures, LLC, The Andre Agassi Trust, Investments AKA and ASI
Group on February 12, 2026, which information we have not independently
confirmed. Also includes 500,000 shares of common stock issuable upon
exercise of warrants to purchase 500,000 shares of common stock with an
exercise price of $5.50 per share and an expiration date of November 22,
2030, which are exercisable within 60 days of the Date of Determination, which
are held by Stefanie Graf, the spouse of Andre Agassi, pursuant to the rules
of the Commission regarding beneficial ownership. Andre K. Agassi may be
deemed to share beneficial ownership of such securities by virtue of his
relationship with Stefanie Graf and the potential to share voting and/or
dispositive power over such securities. Andre Agassi disclaims beneficial
ownership of all securities held by Stefanie Graf, except to the extent of
any pecuniary interest therein. |
|
|
|
|
|
|
(4) |
Address: 59 Putnam Blvd.,
Atlantic Beach, New York 11509. All information included in this footnote
comes from the Schedule 13G filed with the SEC by Mr. Low on February 11,
2025, which information we have not independently confirmed. |
|
|
|
71 |
|
|
|
|
|
**Change of Control**
The Company is not aware of any
arrangements which may at a subsequent date result in a change of control of
the Company.
****
**Equity Compensation Plan Information**
The following table sets forth information, as of December
31, 2025, with respect to our compensation plans under which common stock is
authorized for issuance.
|
Plan
Category |
|
Number of securities to be issued upon exercise of
outstanding options, warrants and rights(A) |
|
|
Weighted-average exercise price of outstanding options,
warrants and rights(B) |
|
|
Number of securities remaining available for future
issuance under equity compensation plans (excluding securities reflected in
Column A)(C) |
|
|
|
Equity compensation plans approved by
stockholders |
|
|
|
|
|
$ |
|
|
|
|
|
|
|
|
Equity compensation plans not approved by
stockholders (1) |
|
|
4,875,000 |
|
|
$ |
1.73 |
|
|
|
|
|
|
|
Total |
|
|
4,875,000 |
|
|
$ |
1.73 |
|
|
|
|
|
|
(1) Represents warrants to purchase
2,975,000 shares of common stock with an exercise price of $0.3970 per share
and an expiration date of July 3, 2029; warrants to purchase 850,000 shares of
common stock with an exercise price of $1.70 per share, which expire on March
6, 2030; warrants to purchase 50,000 shares of common stock with an exercise
price of $6.30 per share and an expiration date of July 31, 2028; and warrants
to purchase 1,000,000 shares of common stock with an exercise price of $5.50
per share and an expiration date of November 22, 2030. The warrants were issued
to the warrant holders in consideration of services and support previously
performed and provided, and expected to be performed or provided, by the warrant
holders in furtherance of the Companys business objectives.
**Agassi Sports
Entertainment Corp. 2026 Equity Incentive Plan**
**
*General*
On March 23, 2026, the Board of
Directors adopted the Agassi Sports Entertainment Corp. 2026 Equity Incentive
Plan, which became effective on the same date (the 2026 Plan).
****
The 2026 Plan provides an
opportunity for any employee, officer, director or consultant of the Company,
subject to limitations provided by federal or state securities laws, to receive
(i)nonqualified stock options; (ii)stock appreciation rights;
(iii)restricted stock awards; (iv)restricted stock units;
(v)shares in performance of services; (vi)other awards of equity or
equity based compensation; or (vii)any combination of the foregoing. In
making such determinations, the Board or Compensation Committee may take into
account the nature of the services rendered by such person, his or her present
and potential contribution to the Companys success, and such other factors as
the Board or Compensation Committee, in its discretion shall deem relevant.
*Shares
Available Under the 2026 Plan***
Subject to adjustment in
connection with the payment of a stock dividend, a stock split or subdivision
or combination of the shares of common stock, or a reorganization or
reclassification of the Companys common stock, the aggregate number of shares
of common stock which may be issued pursuant to awards under the 2026 Plan is
1,500,000.
|
|
72 |
|
|
|
|
|
If an award granted under the
2026 Plan entitles a holder to receive or purchase shares of our common stock,
then on the date of grant of the award, the number of shares covered by the
award (or to which the award relates)will be counted against the total
number of shares available for granting awards under the 2026 Plan. As a
result, the shares available for granting future awards under the 2026 Plan
will be reduced as of the date of grant. However, certain shares that have been
counted against the total number of shares authorized under the 2026 Plan in
connection with awards previously granted under such 2026 Plan will again be
available for awards under the 2026 Plan as follows: shares of our common stock
covered by an award or to which an award relates which were not issued because
the award terminated or was paid in cash or any portion thereof that was
forfeited or cancelled without the delivery of shares will again be available
for awards, including, but not limited to shares forfeited to pay any exercise
price or tax obligation.
In addition, shares of common
stock related to awards that expire, are forfeited or cancelled or terminate
for any reason without the issuance of shares shall not be treated as issued
pursuant to the 2026 Plan.
The shares available for awards
under the 2026 Plan will be authorized but unissued shares of our common stock
or shares acquired in the open market or otherwise.
*Administration*
****
The Company is the issuer
(manager)of the 2026 Plan. The 2026 Plan is administered by either
(a)the entire Board of Directors of the Company, or (b)the
Compensation Committee of the Board (if any); or (c)as determined from
time to time by the Board of Directors (as applicable, the Administrator).
Subject to the terms of the 2026 Plan, the Administrator may determine the
recipients, the types of awards to be granted, the number of shares of our
common stock subject to or the cash value of awards, and the terms and
conditions of awards granted under the 2026 Plan, including the period of their
exercisability and vesting. The Administrator also has the authority to provide
for accelerated exercisability and vesting of awards. Subject to the limitations
set forth below, the Administrator also determines the fair market value
applicable to an award and the exercise or strike price of stock options and
stock appreciation rights granted under the 2026 Plan.
The Administrator may also
delegate to one or more executive officers the authority to designate employees
who are not executive officers to be recipients of certain awards and the
number of shares of our common stock subject to such awards. Under any such
delegation, the Administrator will specify the total number of shares of our
common stock that may be subject to the awards granted by such executive
officer. The executive officer may not grant an award to himself or herself.
On or after the date of grant of
an award under the 2026 Plan, the Administrator may (i)accelerate the
date on which any such award becomes vested, exercisable or transferable, as
the case may be, (ii)extend the term of any such award, including,
without limitation, extending the period following a termination of a participants
employment during which any such award may remain outstanding, or
(iii)waive any conditions to the vesting, exercisability or
transferability, as the case may be, of any such award; provided, that the
Administrator shall not have any such authority to the extent that the grant of
such authority would cause any tax to become due under Section 409A of the
Internal Revenue Code (the Code).
*Eligibility*
****
All of our employees (including
our affiliates), non-employee directors and consultants are eligible to
participate in the 2026 Plan and may receive all types of awards thereunder.
No awards are issuable by the
Company under the 2026 Plan (a)in connection with services associated
with the offer or sale of securities in a capital-raising transaction; or
(b)where the services directly or indirectly promote or maintain a market
for the Companys securities.
*Option Terms*
****
Stock options may be granted by
the Administrator and must be non-qualified (non-statutory)stock options.
The Administrator, in its sole discretion, determines the exercise price of any
options granted under the Plan which exercise price is set forth in the
agreement evidencing the option. Stock options are subject to the terms and
conditions, including vesting conditions, set by the Administrator. The
exercise price for all stock options granted under the 2026 Plan will be
determined by the Administrator, except that no stock options can be granted
with an exercise price that is less than 100% of the fair market value of the
Companys common stock on the date of grant.
|
|
73 |
|
|
|
|
|
The term
of all stock options granted under the 2026 Plan will be determined by the
Administrator. Each stock option gives the grantee the right to receive a
number of shares of the Companys common stock upon exercise of the stock
option and payment of the exercise price. The exercise price may be paid in
cash or if approved by the Administrator, shares of the Companys common stock.
The Administrator may also permit other ways for a grantee to pay the exercise
price.
Options
granted under the 2026 Plan may be exercisable in cumulative increments, or
vest, as determined by the Administrator.
The
Administrator may impose limitations on the transferability of stock options
granted under the 2026 Plan in its discretion. Generally, a participant may not
transfer a stock option granted under the 2026 Plan other than by will or the
laws of descent and distribution or, subject to approval by the Administrator,
pursuant to a domestic relations order. However, the Administrator may permit
transfer of a stock option in a manner that is not prohibited by applicable tax
and securities laws. Options may not be transferred to a third party financial
institution for value.
Unless
the terms of an optionholders stock option agreement, or other written
agreement between us and the optionholder, provides otherwise, if an
optionholders service relationship with us or any of our affiliates ceases for
any reason other than disability, death, or cause, the optionholder may
generally exercise any vested options for a period of three months following
the cessation of service. This period may be extended in the event that
exercise of the option is prohibited by applicable securities laws or the
immediate sale of shares acquired upon exercise of the option is prohibited by
our insider trading policy. If an optionholders service relationship with us
or any of our affiliates ceases due to death, or an optionholder dies within a
certain period following cessation of service, the optionholder or a
beneficiary may generally exercise any vested options for a period of 18 months
following the date of death. If an optionholders service relationship with us
or any of our affiliates ceases due to disability, the optionholder may
generally exercise any vested options for a period of 12 months following the
cessation of service. In the event of a termination for cause, options
generally terminate upon the termination date. In no event may an option be
exercised beyond the expiration of its term. Acceptable consideration for the
purchase of common stock issued upon the exercise of a stock option will be
determined by the administrator and may include (i)cash, check, bank
draft or money order; (ii)a broker-assisted cashless exercise; (iii)the
tender of shares of our common stock previously owned by the optionholder;
(iv)a net exercise of the option (to the extent allowed); or
(v)other legal consideration approved by the administrator.
Except as
explicitly provided otherwise in a participants stock option agreement or
other written agreement with us or one of our affiliates, the term cause is
defined in the 2026 Plan to mean any event which would qualify as cause for
termination under the participants employment agreement with the Company, or,
if there is no such employment agreement, any of the following (i)the
recipients dishonest statements or acts with respect to the Company or any
affiliate of the Company, or any current or prospective customers, suppliers,
vendors or other third parties with which such entity does business;
(ii)the recipients commission of (A)a felony or (B)any
misdemeanor involving moral turpitude, deceit, dishonesty or fraud;
(iii)the recipients failure to perform the recipients assigned duties and
responsibilities to the reasonable satisfaction of the Company which failure
continues, in the reasonable judgment of the Company, after written notice
given to the recipient by the Company; (iv)the recipients gross
negligence, willful misconduct or insubordination with respect to the Company
or any affiliate of the Company; or (v)the recipients material violation
of any provision of any agreement(s)between the recipient and the Company
relating to noncompetition, non-solicitation, nondisclosure and/or assignment
of inventions.
****
*Restricted
Stock Unit Awards*
Restricted
stock unit (RSU)awards are granted under restricted stock unit award
agreements adopted by the administrator. Restricted stock unit awards may be
granted in consideration for any form of legal consideration that may be
acceptable to our Board of Directors and permissible under applicable law. A
restricted stock unit award may be settled by cash, delivery of stock, a
combination of cash and stock as deemed appropriate by the administrator, or in
any other form of consideration set forth in the restricted stock unit award
agreement. Additionally, dividend equivalents may be credited in respect of
shares covered by a restricted stock unit award. Except as otherwise provided
in the applicable award agreement, or other written agreement between us and
the recipient, restricted stock unit awards that have not vested will be
forfeited once the participants continuous service ends for any reason.
|
|
74 |
|
|
|
|
|
*Restricted
Stock Awards*
Restricted
stock awards are granted under restricted stock award agreements adopted by the
administrator. A restricted stock award may be awarded in consideration for
cash, check, bank draft or money order, past or future services to us, or any
other form of legal consideration that may be acceptable to our Board of
Directors and permissible under applicable law. The administrator determines
the terms and conditions of restricted stock awards, including vesting and
forfeiture terms. If a participants service relationship with us ends for any
reason, we may receive any or all of the shares of common stock held by the
participant that have not vested as of the date the participant terminates
service with us through a forfeiture condition or a repurchase right.
*Stock
Appreciation Rights*
Stock
appreciation rights are granted under stock appreciation right agreements
adopted by the administrator. The administrator determines the purchase price
or strike price for a stock appreciation right, which generally will not be
less than 100% of the fair market value of our common stock on the date of
grant. A stock appreciation right granted under our 2026 Plan will vest at the
rate specified in the stock appreciation right agreement as determined by the
administrator. Stock appreciation rights may be settled in cash or shares of
our common stock or in any other form of payment as determined by our Board of
Directors and specified in the stock appreciation right agreement.
The
administrator determines the term of stock appreciation rights granted under
our 2026 Plan, up to a maximum of 10 years. If a participants service
relationship with us or any of our affiliates ceases for any reason other than
cause, disability, or death, the participant may generally exercise any vested
stock appreciation right for a period of three months following the cessation
of service. This period may be further extended in the event that exercise of
the stock appreciation right following such a termination of service is
prohibited by applicable securities laws. If a participants service
relationship with us, or any of our affiliates, ceases due to disability or
death, or a participant dies within a certain period following cessation of
service, the participant or a beneficiary may generally exercise any vested
stock appreciation right for a period of 12 months in the event of disability
and 18 months in the event of death. In the event of a termination for cause,
stock appreciation rights generally terminate upon the termination date. In no
event may a stock appreciation right be exercised beyond the expiration of its
term.
*Performance
Awards*
Our 2026
Plan permits the grant of performance awards that may be settled in stock, cash
or other property. Performance awards may be structured so that the stock or
cash will be issued or paid only following the achievement of certain
pre-established performance goals during a designated performance period.
Performance awards that are settled in cash or other property are not required
to be valued in whole or in part by reference to, or otherwise based on, our
common stock.
The
performance goals may be based on any measure of performance selected by our
Board of Directors. The performance goals may be based on company-wide
performance or performance of one or more business units, divisions,
affiliates, or business segments, and may be either absolute or relative to the
performance of one or more comparable companies or the performance of one or
more relevant indices. Unless specified otherwise by our Board of Directors at
the time the performance award is granted, our Board of Directors will
appropriately make adjustments in the method of calculating the attainment of
performance goals as follows: (i)to exclude restructuring and/or other
nonrecurring charges; (ii)to exclude exchange rate effects; (iii)to
exclude the effects of changes to generally accepted accounting principles;
(iv)to exclude the effects of any statutory adjustments to corporate tax
rates; (v)to exclude the effects of items that are unusual in nature or
occur infrequently as determined under generally accepted accounting
principles; (vi)to exclude the dilutive effects of acquisitions or joint
ventures; (vii)to assume that any business divested by us achieved
performance objectives at targeted levels during the balance of a performance
period following such divestiture; (viii)to exclude the effect of any
change in the outstanding shares of our common stock by reason of any stock
dividend or split, stock repurchase, reorganization, recapitalization, merger,
consolidation, spin-off, combination or exchange of shares or other similar
corporate change, or any distributions to common stockholders other than
regular cash dividends; (ix)to exclude the effects of stock based
compensation and the award of bonuses under our bonus plans; (x)to
exclude costs incurred in connection with potential acquisitions or
divestitures that are required to be expensed under generally accepted
accounting principles; and (xi)to exclude the goodwill and intangible
asset impairment charges that are required to be recorded under generally
accepted accounting principles.
|
|
75 |
|
|
|
|
|
*Other
Stock Awards*
The
administrator may grant other awards based in whole or in part by reference to
our common stock. The administrator will set the number of shares under the
stock award (or cash equivalent)and all other terms and conditions of
such awards.
*Tax
Withholding Adjustments*
To the
extent provided by the terms of an option or other award, or otherwise agreed
to by the Administrator, a participant may satisfy any federal, state or local
tax withholding obligation relating to the exercise of such option, or award by
a cash payment upon exercise, or in the discretion of the Administrator, by
authorizing our company to withhold a portion of the stock otherwise issuable
to the participant, by delivering already-owned shares of our common stock or
by a combination of these means.
*Changes
to Capital Structure*
In the
event there is a specified type of change in our capital structure, such as a
stock split, reverse stock split, or recapitalization, appropriate adjustments
will be made to (i)the class and maximum number of shares reserved for
issuance under our 2026 Plan, (ii)the class and maximum number of shares
by which the share reserve may increase automatically each year, and
(iii)the class and maximum number of shares that may be issued on the
exercise of stock options.
*Corporate
Transactions*
In the
event of a corporate transaction (as defined in the 2026 Plan), unless
otherwise provided in a participants stock award agreement or other written
agreement with us or one of our affiliates or unless otherwise expressly
provided by the administrator at the time of grant, any stock awards
outstanding under our 2026 Plan may be assumed, continued or substituted for by
any surviving or acquiring corporation (or its parent company), and any
reacquisition or repurchase rights held by us with respect to the stock award
may be assigned to the successor (or its parent company). If the surviving or
acquiring corporation (or its parent company)does not assume, continue or
substitute for such stock awards, then (i)with respect to any such stock
awards that are held by participants whose continuous service has not
terminated prior to the effective time of the corporate transaction, or current
participants, the vesting (and exercisability, if applicable)of such
stock awards will be accelerated in full (or, in the case of performance awards
with multiple vesting levels depending on the level of performance, vesting
will accelerate at 100% of the target level)to a date prior to the
effective time of the corporate transaction (contingent upon the effectiveness
of the corporate transaction), and such stock awards will terminate if not
exercised (if applicable)at or prior to the effective time of the
corporate transaction, and any reacquisition or repurchase rights held by us
with respect to such stock awards will lapse (contingent upon the effectiveness
of the corporate transaction); and (ii)any such stock awards that are
held by persons other than current participants will terminate if not exercised
(if applicable)prior to the effective time of the corporate transaction,
except that any reacquisition or repurchase rights held by us with respect to
such stock awards will not terminate and may continue to be exercised
notwithstanding the corporate transaction.
In the
event a stock award will terminate if not exercised prior to the effective time
of a corporate transaction, the administrator may provide, in its sole
discretion, that the holder of such stock award may not exercise such stock
award but instead will receive a payment equal in value to the excess (if
any)of (i)the value of the property the participant would have
received upon the exercise of the stock award, over (ii)any per share
exercise price payable by such holder, if applicable. In addition, any escrow,
holdback, earn out or similar provisions in the definitive agreement for the
corporate transaction may apply to such payment to the same extent and in the
same manner as such provisions apply to the holders of our common stock.
|
|
76 |
|
|
|
|
|
****
*Change
in Control*
Stock
awards granted under our 2026 Plan may be subject to acceleration of vesting
and exercisability upon or after a change in control (as defined in the 2026
Plan)as may be provided in the applicable stock award agreement or in any
other written agreement between us or any affiliate and the participant, but in
the absence of such provision, no such acceleration will automatically occur.
*Repricing;
Cancellation and Re-Grant of Stock Options or Stock Appreciation Rights*
The
Administrator has the right to effect, at any time and from time to time,
subject to the consent of any participant whose award is materially impaired by
such action, (1)the reduction of the exercise price (or strike
price)of any outstanding option or stock appreciation right (SAR);
(2)the cancellation of any outstanding option or SAR and the grant in
substitution therefor of (A)a new option, SAR, restricted stock award,
RSU award or other award, under the 2026 Plan or another equity plan of the
Company, covering the same or a different number of shares of common stock,
(B)cash and/or (C)other valuable consideration (as determined by
the Board); or (3)any other action that is treated as a repricing under
generally accepted accounting principles.
*Duration;
Termination of the 2026 Plan*
Our Board
of Directors has the authority to amend, suspend, or terminate our 2026 Plan at
any time, provided that such action does not materially impair the existing
rights of any participant without such participants written consent. Certain
material amendments also require the approval of our stockholders. No stock
awards may be granted under our 2026 Plan while it is suspended or after it is
terminated.
**ITEM
13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE**
Except as discussed below, or otherwise disclosed above
under Executive Compensation, there have been no transactions since January
1, 2024, and there is not currently any proposed transaction, in which the
Company was or is to be a participant, where the amount involved exceeds the
lesser of $120,000 or one percent of the average of the Companys total assets
at year-end, for the last two completed fiscal years, and in which any officer,
director, or any stockholder owning greater than five percent (5%) of our
outstanding voting shares, nor any member of the above referenced individuals
immediate family, had or will have a direct or indirect material interest.
**Related Party Transactions**
The Company has received
funding for operations from All
American Golf Center, Inc., owned by Ronald Boreta and John Boreta.
These funds helped pay for office supplies, phone charges, postage and
salaries.
On July 3, 2024, the Company
entered into a share purchase agreement with All American Golf Center, Inc.
(the Creditor), pursuant to which the Creditor agreed to exchange
shares of the Companys common stock in consideration for the Creditors
release of obligations of the Company to repay expenses in the aggregate amount
of $593,670 for expenses of the Company previously paid by the Creditor.
Pursuant to the Purchase Agreement, the 1,495,390 shares of common stock to be
issued by the Company to the Creditor upon consummation of the exchange was
determined based upon an implied price per share of common stock, equal to
$0.397.The Creditor is an existing significant stockholder of the Company
that is owned and controlled by Ronald S. Boreta, President, Chief Executive
Officer, Secretary, and a director of the Company (also a greater than 10%
stockholder), and John Boreta, a then director and greater than 10% stockholder
of the Company. At
December 31, 2025 and December 31, 2024, the total amounts owed to All-American
Golf Center, Inc. were $0 and $0, respectively.
Also on July 3, 2024, the Company
issued warrants to purchase 2,975,000 shares of common stock at an exercise
price of $0.397 per share, (i) to James Askew, an individual, who was
subsequently appointed as a member of the Board of Directors of the
Company (Warrants to purchase 2,269,583 shares of common stock), and (ii)
to Investments AKA, LLC, a limited liability company indirectly controlled by Andre
Agassi (Warrants to purchase 705,417 shares of common stock). The
Warrants vested immediately.The Warrants were exercisable as to one half
of the shares of common stock immediately, and exercisable as to the remaining
half of the shares of common stock one year following the grant date of the
Warrant. The Warrants were issued to the Warrant Holders in consideration of
services and support previously performed and provided, and expected to be
performed or provided, by the Warrant Holders in furtherance of the Companys
business objectives.
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77 |
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The Company also entered into a
Consulting Agreement, dated July 3, 2024, with Askew with respect to his
services and the issuance of his Warrants.
The Companys
corporate offices are located at 1120 N Town Center Drive, Suite 160, Las
Vegas, Nevada 89144 in space shared with Agassi Graf Holdings, which is affiliated
with Andre Agassi, the Companys largest stockholder, which is provided to the
Company without charge.
On November 22, 2025, the Company
entered into Brand Partner Agreement with Stefanie Graf (the Brand Partner
Agreement), pursuant to which Ms. Graf (a Brand Partner) has
agreed to serve as a Company advisor, spokesperson, celebrity endorser and
brand partner. Ms. Graf is the spouse of Andre Agassi, a greater than 5%
stockholder of the Company.
Pursuant to the Brand Partner
Agreement, the Brand Partner will (i) participate in certain Company projects
and initiatives, subject to agreement as to scope and compensation in each
instance; (ii) promote the Companys brand and content through public
appearances, interviews, and social media activity, subject to mutual agreement
as to each social media post; and (iii) provide advice and consultation upon
Company request with respect to the Companys brand and content. The
Brand Partner has also licensed her image, name and likeness to the Company for
use in our public relations, advertising and marketing, on a worldwide basis,
subject to the Brand Partners right to disapprove of any particular use. The
Brand Partner Agreement has a five-year term, subject to extension by mutual
agreement.
In consideration for her services
under the Brand Partner Agreement, we granted Ms. Graf warrants to purchase
1,000,000 shares of the Companys common stock at an exercise price of $5.50
per share (the Graf Warrants). The Graf Warrants vested
immediately and have a five-year term. The Graf Warrants were exercisable
as to one half of the shares of common stock immediately, and exercisable as to
the remaining half of the shares of common stock one year following the grant
date. The Graf Warrants may be exercised either by cash payment or via
cashless exercise based on a formula set forth in the Graf Warrants.
The Brand Partner Agreement may
be terminated by either party at any time, with or without cause, upon written
notice. The Brand Partner Agreement includes customary representations of the
parties and confidentiality provisions. The Company may assign its rights under
the Brand Partner Agreement to an affiliate or in connection with the bona fide
sale of the Companys business, whether by way of sale, merger or acquisition,
but the Brand Partner Agreement is otherwise non-assignable.
On February 4, 2026, James Askew, a member of the Board of
Directors of the Company exercised warrants to purchase an aggregate of
2,269,583 shares of the Companys common stock with an exercise price of $0.397
per share on a cashless basis. In connection with such exercise, the Company
issued to Mr. Askew a net of 2,097,740 shares of common stock, after the
forfeiture of 171,843 warrant shares to the Company in satisfaction of the
aggregate exercise price, based on the fair market value of the Companys
common stock on the exercise date, as determined in accordance with the terms
of the warrants.
On February 6, 2026, Investments AKA, LLC, a limited
liability company indirectly controlled by Andre Agassi (a greater than 5%
stockholder of the Company), exercised warrants to purchase an aggregate of
705,417 shares of the Companys common stock with an exercise price of $0.397
per share on a cashless basis. In connection with such exercise, the Company
issued to Investments AKA, LLC a net of 651,231 shares of common stock, after
the forfeiture of 54,186 warrant shares to the Company in satisfaction of the
aggregate exercise price, based on the fair market value of the Companys
common stock on the exercise date, as determined in accordance with the terms
of the warrants.
On March 13, 2026, the Company
entered into two Subscription Agreements with two accredited investors (the Investors),
pursuant to which the Investors purchased an aggregate of 80,000 shares of
restricted common stock from the Company, for $5.00 per share, or a total of
$400,000. The Subscription Agreements included customary representations and
warranties of the Investors and the Company.
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78 |
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One of the Investors was the
Boreta Lifetime Trust, whose trustee is Ronald S. Boreta, the Companys
President, Chief Executive Officer and director. The Boreta Trust purchased
50,000 shares of restricted common stock for $5.00 per share or $250,000 in
aggregate.
Jett Boreta, the son
of our Chief
Executive Officer and director, Ronald S. Boreta is employed by the Company as a data
analystand was paid $5,191 and $0 in compensation for
the years ended December 31, 2025 and 2024, respectively. James
(Jake) Askew and Austin Askew, both sons of director James
Askew, are
employed by the Company in business development
positionsand were paid $97,222 and $10,000 and $77,405
and $10,000 in compensation for the years ended December 31, 2025 and 2024,
respectively.
**Review,
Approval and Ratification of Related Party Transactions**
Given
our small size and limited financial resources, we have not adopted formal
policies and procedures for the review, approval or ratification of
transactions, such as those described above, with our executive officers,
directors and significant stockholders. However, all of the transactions described
above were approved and ratified by our directors. In connection with the
approval of the transactions described above, our directors took into account
various factors, including his fiduciary duty to the Company; the relationships
of the related parties described above to the Company; the material facts
underlying each transaction; the anticipated benefits to the Company and
related costs associated with such benefits; whether comparable products or
services were available; and the terms the Company could receive from an
unrelated third party.
We intend to establish formal
policies and procedures in the future, once we have sufficient resources and
have appointed additional directors. On a moving forward basis, our directors
will continue to approve any related party transaction based on the criteria
set forth above.
**Director
Independence**
Our common stock is currently
quoted on the OTCID maintained by OTC Markets. The OTCID does not require us to
have independent members of our Board of Directors.
**ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES**
***Audit Fees*******
The aggregate fees billed by our
independent auditors, RBSM LLP, for professional services rendered for the
audit of our annual financial statements, and for the review of quarterly
financial statements for the fiscal years ended December 31, 2025 and 2024,
respectively, were:
|
Fee Category |
|
2025 |
|
2024 |
|
|
Audit Fees(1) |
|
$ |
34,500 |
|
|
$ |
32,000 |
|
|
|
Audit-related fees(2) |
|
|
|
|
|
|
|
|
|
|
Tax fees(3) |
|
|
5,000 |
|
|
|
5,000 |
|
|
|
All other fees(2) |
|
|
|
|
|
|
|
|
|
|
Total Fees |
|
$ |
39,500 |
|
|
$ |
37,000 |
|
|
(1) Represents services rendered
for the audit of the Companys annual financial statements and review of
financial statements included in the Companys Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q.
(2) We had no audit-related
fees or all other fees for the years presented.
(3) Represents the aggregate fees
billed for tax compliance and tax advice.
Audit fees incurred by the
Company were pre-approved by the Board of Directors.
|
|
79 |
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|
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|
|
**Audit Committee Pre-Approval Policy**
Under provisions of the
Sarbanes-Oxley Act of 2002, the Companys principal accountant may not be
engaged to provide non-audit services that are prohibited by law or regulation
to be provided by it, and the Board of Directors (which serves as the Companys
audit committee) must pre-approve the engagement of the Companys principal
accountant to provide audit and permissible non-audit services. The Companys
Board has not established policies or procedures other than those required by
applicable laws and regulations.
|
|
80 |
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|
|
**PART IV**
**ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES**
(a)Documents filed as part
of this Annual Report:
|
|
(1) |
Consolidated Financial StatementsThe financial statements and notes are included
herein under Part II-Item 8. Financial Statements and Supplementary Data. |
|
**AGASSI SPORTS ENTERTAINMENT CORP.**
**TABLE OF CONTENTS TO FINANCIAL STATEMENTS**
|
|
Page |
|
|
Index to Financial Statements |
|
|
|
Report of Independent Registered Public Accounting Firm |
42 |
|
|
Balance Sheets |
43 |
|
|
Statements of Operations |
44 |
|
|
Statements of Stockholders Equity (Deficit) |
45 |
|
|
Statements of Cash Flows |
46 |
|
|
Notes to Financial Statements |
47 |
|
|
|
(2) |
Consolidated Financial Statement Schedules |
|
All schedules are omitted because
they are inapplicable or not required or the required information is shown in
the consolidated financial statements or notes thereto.
|
|
81 |
|
|
|
|
|
|
|
(3) |
Exhibits required by Item 601 of Regulation
S-K |
|
|
Exhibit |
|
|
Filed/Furnished |
|
Incorporated By Reference |
|
|
Number |
|
Description of Exhibit |
Herewith |
|
Form |
|
Exhibit |
|
FilingDate |
|
File Number |
|
|
3.1 |
|
Articles of Incorporation Since Formation |
|
|
10-K |
|
3.1 |
|
3/26/2025 |
|
000-24970 |
|
|
3.2 |
|
Certificate of Amendment to Articles of Incorporation
filed with the Nevada Secretary of State on March 25,
2025andeffective on March 31, 2025 |
|
|
8-K |
|
3.1 |
|
3/31/2024 |
|
000-24970 |
|
|
3.3 |
|
Amended and Restated Bylaws of Global
Acquisitions Corp. |
|
|
8-K |
|
3.1 |
|
1/10/2025 |
|
000-24970 |
|
|
4.1 |
|
Form of Warrant to Purchase Shares of
Common Stock Dated July 3, 2024 |
|
|
8-K |
|
4.1 |
|
7/5/2024 |
|
000-24970 |
|
|
4.2 |
|
Global Acquisitions Corporation, Warrant to
Purchase Common Stock dated March 6, 2025, issued to Shawn Cable |
|
|
8-K |
|
4.1 |
|
3/11/2025 |
|
000-24970 |
|
|
4.3 |
|
Global Acquisitions Corporation, Warrant to
Purchase Common Stock dated March 6, 2025, issued to Justin Gimblestob |
|
|
8-K |
|
4.2 |
|
3/11/2025 |
|
000-24970 |
|
|
4.4 |
|
Global Acquisitions Corporation, Warrant to
Purchase Common Stock dated March 6, 2025, issued to Darren Cahill |
|
|
8-K |
|
4.3 |
|
3/11/2025 |
|
000-24970 |
|
|
4.5 |
|
Common Stock Purchase Warrant dated May 31,
2025, granted by Agassi Sports Entertainment Corp. to Patrick J. Rolfes |
|
|
8-K |
|
4.1 |
|
6/4/2025 |
|
000-24970 |
|
|
4.6 |
|
Common Stock Purchase Warrant dated May 31,
2025, granted by Agassi Sports Entertainment Corp. to Ted Angelo |
|
|
8-K |
|
4.2 |
|
6/4/2025 |
|
000-24970 |
|
|
4.7 |
|
Common Stock Purchase Warrant dated
November 24, 2025, granted by Agassi Sports Entertainment Corp. to Stefanie
Graf |
|
|
8-K |
|
4.1 |
|
11/25/2025 |
|
000-24970 |
|
|
4.8* |
|
Description of Securities |
[X] |
|
|
|
|
|
|
|
|
|
|
10.1 |
|
Purchase Agreement, dated as of July 3,
2024, by and between Global Acquisitions Corporation, and All-American Golf
Center, Inc. |
|
|
8-K |
|
10.1 |
|
7/5/2024 |
|
000-24970 |
|
|
10.2 |
|
Consulting Agreement, dated as of July 3,
2024, by and between Global Acquisitions Corporation and James Askew |
|
|
8-K |
|
10.2 |
|
7/5/2024 |
|
000-24970 |
|
|
10.3 |
|
Form of Subscription Agreement for November
2024 Private Offering by Global Acquisitions Corporation and the Investors
party thereto |
|
|
8-K |
|
10.1 |
|
11/8/2024 |
|
000-24970 |
|
|
10.4 |
|
Trademark Acquisition Agreement dated May
31, 2025, by and between Agassi Sports Entertainment Corp., Patrick J. Rolfes
and Ted Angelo |
|
|
8-K |
|
10.1 |
|
6/4/2025 |
|
000-24970 |
|
|
10.5 |
|
Statement of Work dated July 2, 2025, by
and between Agassi Sports Entertainment Corp. and IBM Norge AS |
|
|
8-K |
|
10.1 |
|
7/9/2025 |
|
000-24970 |
|
|
10.6 |
|
Collaboration and Licensing Agreement
entered into on July 10, 2025, by and between Agassi Sports Entertainment
Corp. and Sport Squad, Inc. (JOOLA) |
|
|
8-K |
|
10.1 |
|
7/15/2025 |
|
000-24970 |
|
|
10.7# |
|
Partnership Agreement for Consulting
Services dated October 31, 2025, by and between Agassi Sports Entertainment
Corp. and IBM Norge AS |
|
|
8-K |
|
10.1 |
|
11/5/2025 |
|
000-24970 |
|
|
10.8# |
|
Commitment Agreement dated October 31,
2025, by and between Agassi Sports Entertainment Corp. and IBM Norge AS |
|
|
8-K |
|
10.2 |
|
11/5/2025 |
|
000-24970 |
|
|
10.9# |
|
Statement of Work 1 (SOW 1) Agassi
Digital Transformation Partner, dated October 31, 2025, by and between Agassi
Sports Entertainment Corp. and IBM Norge AS |
|
|
8-K |
|
10.3 |
|
11/5/2025 |
|
000-24970 |
|
|
10.10 |
|
Brand Partner Agreement dated November 22,
2025, by and between Agassi Sports Entertainment Corp. and Stefanie Graf |
|
|
8-K |
|
10.1 |
|
11/25/2025 |
|
000-24970 |
|
|
10.11# |
|
Embedded Solution Agreement IBM Cloud
Enterprise Savings PLAN ESA Transaction Document dated February 2, 2026, by
and between Agassi Sports Entertainment Corp. and International Business
Machines Corporation |
|
|
8-K |
|
10.1 |
|
2/3/2026 |
|
000-24970 |
|
|
10.12# |
|
Embedded Solution Agreement Attachment for
Build Fund Cloud Credits dated February 2, 2026, by and between Agassi Sports
Entertainment Corp. and International Business Machines Corporation |
|
|
8-K |
|
10.2 |
|
2/3/2026 |
|
000-24970 |
|
|
10.13 |
|
Executive Employment Agreement dated March 25, 2026, by and between
Agassi Sports Entertainment Corp. and Ronald S. Boreta |
|
|
8-K |
|
10.1 |
|
3/26/2026 |
|
000-24970 |
|
|
10.14 |
|
Agassi Sports Entertainment Corp.
2026 Equity Incentive Plan |
|
|
8-K |
|
10.2 |
|
3/26/2026 |
|
000-24970 |
|
|
14.1 |
|
Code of Ethics |
|
|
10-KSB |
|
14.1 |
|
4/15/2008 |
|
000-24970 |
|
|
31.1* |
|
Certification of Principal Executive Officer pursuant to Section 302
of the Sarbanes-Oxley Act |
[X] |
|
|
|
|
|
|
|
|
|
|
31.2* |
|
Certification of Principal Financial Officer pursuant to Section 302
of the Sarbanes-Oxley Act |
[X] |
|
|
|
|
|
|
|
|
|
|
32.1** |
|
Certification of Principal Officer Pursuant to Section 906 of the
Sarbanes-Oxley Act |
[X] |
|
|
|
|
|
|
|
|
|
|
32.2** |
|
Certification of Principal Financial Officer Pursuant to Section 906
of the Sarbanes-Oxley Act |
[X] |
|
|
|
|
|
|
|
|
|
|
101.INS* |
|
Inline XBRL Instance Document - the instance document does not appear
in the Interactive Data File because its XBRL tags are embedded within the
Inline XBRL document |
[X] |
|
|
|
|
|
|
|
|
|
|
101.SCH* |
|
XBRL Taxonomy Extension Schema Document |
[X] |
|
|
|
|
|
|
|
|
|
|
101.CAL* |
|
XBRL Taxonomy Extension Calculation Linkbase Document |
[X] |
|
|
|
|
|
|
|
|
|
|
101.DEF* |
|
XBRL Taxonomy Extension Definition Linkbase Document |
[X] |
|
|
|
|
|
|
|
|
|
|
101.LAB* |
|
XBRL Taxonomy Extension Label Linkbase Document |
[X] |
|
|
|
|
|
|
|
|
|
|
101.PRE* |
|
XBRL Taxonomy Extension Presentation Linkbase Document |
[X] |
|
|
|
|
|
|
|
|
|
|
104* |
|
Inline XBRL for the cover page of this Quarterly Report on Form 10-K
included in the Exhibit 101 Inline XBRL Document Set |
[X] |
|
|
|
|
|
|
|
|
|
* Filed herewith.
** Furnished herewith.
Exhibit constitutes a
management contract or compensatory plan or agreement.
# Certain confidential portions
of this Exhibit were omitted by means of marking such portions with brackets
([***]) because the identified confidential portions (i) are not material and
(ii) the Company customarily and actually treats that information as private or
confidential.
Certain schedules and exhibits
have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company
agrees to furnish supplementally a copy of such schedules and exhibits, or any
section thereof, to the SEC upon request; provided, however, that the Company
may request confidential treatment pursuant to Rule 24b-2 under the Exchange
Act for any exhibits or schedules so furnished.
The Company does not have any
subsidiaries.
The Company does not have an
insider trading policy or a clawback policy.
**ITEM 16. FORM 10K SUMMARY.**
Not provided.
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|
82 |
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|
|
**SIGNATURES**
Pursuant to the requirements of Section 13 or
15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused
this Report to be signed on its behalf by the undersigned there under duly
authorized.
|
|
AGASSI SPORTS ENTERTAINMENT CORP. |
|
|
|
|
|
|
|
|
|
|
|
|
Dated: March 31, 2026 |
By: |
/s/ Ronald S. Boreta |
|
|
|
|
Ronald S. Boreta, Chief Executive Officer and President (Principal
Executive Officer) |
|
|
|
|
|
|
|
|
|
|
|
Pursuant to the requirements of the Securities Exchange
Act of 1934, this Report has been signed by the following persons on behalf of
the Registrant and in the capacities and on the dates indicated:
|
Name |
Title |
Date |
|
|
|
|
|
|
|
|
|
|
|
|
/s/ Ronald S. Boreta |
President, Chief Executive Officer, and Director(Principal Executive
Officer) |
March 31, 2026 |
|
|
Ronald S. Boreta |
|
|
|
|
|
|
|
/s/ Shawn Cable |
|
|
|
Shawn Cable |
Chief Financial Officer (Principal Financial/Accounting
Officer) |
March 31, 2026 |
|
|
|
|
|
|
|
/s/ James Askew |
Director |
March 31, 2026 |
|
|
James Askew |
|
|
|