Material Agreement (Form 8-K)

Item 1.01 Entry into a Material Definitive Agreement.

On April 10, 2026, Allied Gaming & Entertainment Inc. (the "Company") and Yangyang Li, its Chief Executive Officer and Chairman, in his personal capacity ("Mr. Li", and together with the Company, the "Allied Parties") entered into a binding Term Sheet for Global Resolution (the "Term Sheet") with Knighted Pastures, LLC ("Knighted") and Roy Choi, in his personal capacity ("Mr. Choi", and together with Knighted, the "Knighted Parties"). The Term Sheet summarizes the principal terms of the global resolution between the parties regarding (i) the action initiated by Knighted against the Company and its directors in the Delaware Court of Chancery on November 12, 2024, Knighted Pastures, LLC v. Yangyang Li, et. al, C.A. No. 2024-1158-JTL (the "Delaware Litigation"), and (ii) the action initiated by the Company against Knighted and other defendants in the United States District Court for the Central District of California on June 11, 2025, Allied Gaming & Entertainment, Inc. v. Knighted Pastures, LLC, 2:25-CV-05312 (C.D. Cal.) (the "Federal Litigation").

Pursuant to the Term Sheet, the Company agreed to pay Knighted's fees and expenses in the Delaware Litigation totaling $5,936,738.36 (the "Fee Award") as previously ordered by the Delaware Court of Chancery on March 10, 2026, according to the following payment schedule: (i) $1,000,000.00 due on May 7, 2026, (ii) $2,000,000.00 due on June 30, 2026, and (iii) $2,936,738.36 due on July 31, 2026. Interest accrues monthly on the outstanding balance of the Fee Award beginning on April 8, 2026 at a rate of 8.75% per annum. If any payment is not made in full by the applicable due date, additional interest accrues on the full outstanding amount at a rate of 10% per annum, compounded daily until such payment is made.

In connection with the execution of the Term Sheet, the Company and Mr. Li, as guarantors, entered into a Guaranty, dated as of April 10, 2026 (the "Guaranty"), pursuant to which the Company and Mr. Li jointly and severally guaranteed to Knighted the payment of the Fee Award, together with all accrued interest.

The Term Sheet also provides that, within five business days of the effective date of the Term Sheet, the Company will file a Notice of Dismissal With Prejudice of the Federal Litigation. The parties further agreed that neither party will file any fee application in the Federal Litigation or pursue any appeal related to either the Federal Litigation or the Delaware Litigation.

The Term Sheet contains mutual non-disparagement provisions. Each party is also required to promptly delete, remove, and/or retract any disparaging comments or statements concerning the other party, including postings on blogs, social media, and other websites, regardless of when such statements were made.

From the effective date of the Term Sheet, each party agreed, for a period of two years, not to bring any claims against the other party relating to any breach of duties, breach of contract or securities laws violations, other than claims arising from or relating to the enforcement of the Term Sheet. Upon completion of the payment of the Fee Award in full with all accrued interest, the Company and Knighted will provide mutual general releases of claims against each other, in each case from the beginning of time through the date of the release, subject to certain exceptions relating to the enforcement of the Term Sheet. Additionally, upon completion of the payment of the Fee Award in full with all accrued interest, the Company will provide a general release to Yiu-Ting So and Naomi Choi (the "Litigation Third Parties"), and the Litigation Third Parties will provide a reciprocal general release to the Company, from the beginning of time through the date of the release.

The Term Sheet includes a standstill provision pursuant to which the Knighted Parties agreed, for a period of two years from the effective date of the Term Sheet, not to, among other things: (i) acquire, announce an intention to acquire, offer or propose to acquire, or agree to acquire, any shares of the Company's common stock or other voting securities; (ii) make any public announcement or proposal with respect to any business combination, acquisition, restructuring, recapitalization, liquidation, dissolution, tender offer or exchange offer involving the Company or its voting securities; (iii) engage in any solicitation of proxies; (iv) initiate, propose or solicit the Company's stockholders for approval of any shareholder proposal; or (v) seek election or appointment to, or representation on, the Company's board of directors, nominate or propose the nomination of any person to the Company's board of directors, or seek or encourage any person to seek the removal of any member of the Company's board of directors.