Z Squared (ZSQR) acquired an AI data campus in Arkansas designed for 150+ MW capacity.

Z Squared Inc. completed the acquisition of 100% of the membership interests of Paradox Data LLC on September 8, 2026. The transaction was executed pursuant to a Membership Interest Purchase Agreement dated July 31, 2026, involving Z Squared Inc., Paradox Infrastructure LLC as seller, and Paradox Data LLC as the target company. As closing consideration, Z Squared issued 5,000 shares of newly designated Series A Convertible Preferred Stock, par value $0.0001 per share, to the seller. The preferred stock carries an aggregate stated value of $5,000,000.

The target company's primary asset is the Union County Campus in El Dorado, Arkansas, a data center development site consisting of approximately three acres, an existing building, and a contract to acquire roughly 10 additional acres of adjacent land. The site is served by an electric service agreement with Entergy Arkansas, LLC that provides for up to 8,000 kVA, or approximately 8.0 MW, on an interruptible basis. This agreement is currently held by the seller; the target company's access to this capacity is governed by an Intercompany Power Access and Cost-Sharing Agreement. Assignment of the power agreement to the target company requires Entergy's consent, which has not yet been obtained.

Z Squared's development plan targets up to approximately 150 MW of AI-ready capacity over time. Realizing this capacity will require a combination of utility power and on-site generation, necessitating additional power arrangements, customer commitments, financing, permitting, and construction.

At closing, the parties entered into a Triple Net Lease and Relocation Agreement. Under this arrangement, the target company leases the premises to the seller to allow the continued operation of the seller's Bitcoin mining facility pending the transition of electric service and operational control. The base rent is $1.00 per year, and the lease expires no later than the second anniversary of its effective date. Z Squared is liable for a one-time relocation payment of $500,000 payable to the seller upon specified trigger events, with aggregate monetary liability capped at $500,000.

Z Squared remains obligated to make up to four additional milestone payments to the seller and Paradox Energy LLC, a related party, upon achievement of specified development milestones at the Union County Campus. These payments would be made in Series A Preferred Stock with an aggregate stated value of up to $20,000,000. If all milestones are achieved, total consideration under the purchase agreement could reach $25,000,000. No milestones have been achieved as of the date of the report, and there can be no assurance that any will be achieved. Chief Technology Officer Jeffery Harris holds an indirect minority ownership interest in both the seller and Paradox Energy LLC. The transaction was reviewed and approved by the Audit Committee and the Board of Directors as a related person transaction in accordance with Regulation S-K.

The issuance of the Series A Preferred Stock was exempt from registration under the Securities Act of 1933 pursuant to Section 4(a)(2) and/or Rule 506(b) of Regulation D. The exemption relied on representations that the seller is an accredited investor, the absence of general solicitation, and the delivery of customary certifications. The shares constitute restricted securities subject to restrictive legends under Rule 144.