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UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
Date of Report (Date of earliest event reported): September 8, 2026
Z SQUARED INC.
(Exact name of registrant
as specified in its charter)
| Delaware |
|
001-39669 |
|
98-1465952 |
(State or other jurisdiction
of incorporation) |
|
(Commission File Number) |
|
(I.R.S. Employer
Identification No.) |
550 South Andrews Ave., Suite #700
Fort Lauderdale, Florida |
|
33301 |
| (Address of principal executive offices) |
|
(Zip Code) |
305-697-0792
(Registrant’s telephone
number, including area code)
(Former name or former
address, if changed since last report)
Check the appropriate
box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
| ☐ | Written communications pursuant
to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to
Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications
pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications
pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered
pursuant to Section 12(b) of the Act:
| Title of each class |
|
Trading Symbol(s) |
|
Name of each exchange
on which registered |
| Common Stock, par value $0.0001 per share |
|
ZSQR |
|
The Nasdaq
Global Market |
Indicate by check mark
whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter)
or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth
company ☐
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. ☐
Item 1.01. Entry into a Material Definitive Agreement.
As previously reported, on July 31, 2026, Z Squared
Inc. (the “Company”) entered into a Membership Interest Purchase Agreement, dated as of July 31, 2026 (the “MIPA”),
by and among the Company, Paradox Infrastructure LLC, a Florida limited liability company (“Seller”), Paradox Data,
LLC, a Florida limited liability company (the “Target Company”), and the Owner Parties named therein, providing for
the acquisition by the Company of one hundred percent (100%) of the outstanding membership interests of the Target Company (the “Membership
Interests” and such acquisition, the “Transaction”).
On September 8, 2026 (the “Closing Date”),
the Company completed the Transaction. At the closing of the Transaction (the “Closing”), Seller assigned the Membership
Interests to the Company pursuant to an Assignment of Membership Interests, dated as of September 8, 2026 (the “Assignment”),
and the Company was admitted as the sole member of the Target Company, which continues without dissolution. As consideration for the Membership
Interests, on or about the date of Closing the Company issued to Seller 5,000 shares of the Company’s newly designated Series A
Convertible Preferred Stock, par value $0.0001 per share (the “Series A Preferred Stock”), having an aggregate stated
value of $5,000,000 (the “Closing Consideration”).
As part of the Transaction, at the Closing, the
Target Company, Seller and the Company entered into a Triple Net Lease and Relocation Agreement, dated September 8, 2026 (the “Lease”),
pursuant to which the Target Company, as landlord, leases to Seller, as tenant, the existing building and an approximately three-acre
parcel located in El Dorado, Arkansas (the “Premises”), for the continued operation of Seller’s bitcoin mining
facility pending the transition of electric service and operational control of the Premises to the Target Company. Base rent under the
Lease is $1.00 per year. The Company is a party solely with respect to a one-time relocation payment of $500,000 payable to Seller upon
the earliest of specified trigger events, and the Company’s aggregate monetary liability under the Lease is capped at $500,000.
The Lease expires no later than the second anniversary of its effective date.
Also as part of the Transaction, at the Closing,
the Target Company and Seller entered into an Intercompany Power Access and Cost-Sharing Agreement, dated September 8, 2026 (the “Power
Access Agreement”), governing the transition to the Target Company of Seller’s electric service arrangement with Entergy
Arkansas, LLC at the Premises. The Company is not a party to the Power Access Agreement.
The foregoing descriptions of the MIPA, the Transaction,
the Assignment, the Lease and the Power Access Agreement do not purport to be complete and are qualified in their entirety by reference
to the full text of (i) the MIPA, previously filed as Exhibit 2.1 to the Signing 8-K, and (ii) the Assignment, the Lease and the Power
Access Agreement, copies of which are filed as Exhibit 10.3, Exhibit 10.1 and Exhibit 10.2, respectively, to this Current Report on Form
8-K, each of which is incorporated herein by reference.
Item 2.01. Completion of Acquisition or Disposition of Assets.
The information set forth under Item 1.01 of this
Current Report on Form 8-K is incorporated by reference into this Item 2.01.
The Target Company’s principal asset is
the Union County Campus in El Dorado, Arkansas, a data center development site consisting of approximately three acres, the existing building
located thereon and a contract to acquire approximately 10 acres of adjacent land. The site is served by an electric service agreement
with Entergy Arkansas, LLC providing for up to 8,000 kVA (approximately 8.0 MW) on an interruptible basis. That agreement is held by Seller;
the Target Company’s rights to the capacity arise under the Power Access Agreement, and assignment of the agreement to the Target
Company requires Entergy’s consent, which has not been obtained. The Company’s development plan targets up to approximately
150 MW of AI-ready capacity over time through a combination of utility power and on-site generation, which will require additional power
arrangements, customer commitments, financing, permitting and construction.
As previously disclosed, the Company remains obligated
under the MIPA to make up to four additional milestone payments to Seller and to Paradox Energy LLC, a related party, payable in additional
shares of Series A Preferred Stock having an aggregate stated value of up to $20,000,000, upon the achievement of specified development
milestones at the Union County Campus, such that the aggregate potential consideration under the MIPA remains up to $25,000,000 if all
milestones are achieved in full. No milestone has been achieved as of the date of this Report, and there can be no assurance that any
milestone will be achieved.
Related Person Transaction
As previously disclosed in the Signing 8-K, Jeffery
Harris, the Company’s Chief Technology Officer, holds an indirect minority ownership interest in Seller and in Paradox Energy LLC,
an affiliate of Seller that is entitled to receive a portion of the milestone payments described above. The Transaction accordingly constitutes
a related person transaction for purposes of Item 404(a) of Regulation S-K. The MIPA and the Transaction were reviewed and approved as
a related person transaction by the Audit Committee of the Board of Directors, and approved by the Board of Directors, in accordance with
the Company’s related person transaction policy and Item 404 of Regulation S-K.
Item 3.02. Unregistered Sales of Equity Securities.
The information set forth under Items 1.01 and
2.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.02. On September 8, 2026, the Company issued 5,000
shares of Series A Preferred Stock to Seller as the Closing Consideration. The shares of Series A Preferred Stock have not been, and any
shares of the Company’s common stock, par value $0.0001 per share (the “Common Stock”), issuable upon conversion thereof
will not have been, registered under the Securities Act of 1933, as amended (the “Securities Act”), and were issued
in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act and/or Rule 506(b) of Regulation D promulgated
thereunder, based on, among other things, representations by Seller that it is an “accredited investor” as defined in Rule
501(a) of Regulation D, the absence of general solicitation, and delivery of a customary accredited-investor questionnaire and Rule 506(d)
“bad actor” certification. The shares bear restrictive legends and constitute “restricted securities” for purposes
of Rule 144 under the Securities Act.
The rights, preferences and limitations of the
Series A Preferred Stock, including a conversion price of $7.45 per share of Common Stock (subject to customary adjustments for stock
splits, stock dividends, combinations, reclassifications and similar events), an 8.0% cumulative dividend payable in cash or in kind at
the Company’s election, a liquidation preference senior to the Common Stock, an exchange cap and cash-settlement mechanism under
Nasdaq Listing Rule 5635, and optional redemption rights of the Company, are set forth in the Certificate of Designation of Preferences,
Rights and Limitations of the Series A Convertible Preferred Stock (the “Certificate of Designation”), which the Company
filed with the Secretary of State of the State of Delaware on September 8, 2026.
The foregoing description of the Series A Preferred
Stock does not purport to be complete and is qualified in its entirety by reference to the full text of the Certificate of Designation,
a copy of which is filed as Exhibit 3.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change
in Fiscal Year.
On September 8, 2026, the Company filed a Certificate
of Designation with the Secretary of State of the State of Delaware. The information set forth under Item 3.02 above is incorporated herein
by reference. A copy of the Certificate of Designation is filed as Exhibit 3.1 to this Current Report on Form 8-K and is incorporated
herein by reference.
Item 7.01. Regulation FD Disclosure.
On September 9, 2026, the Company issued a press
release announcing the completion of the Transaction. A copy of the press release is furnished as Exhibit 99.1 to this Current Report
on Form 8-K.
The information set forth under this Item 7.01,
including Exhibit 99.1, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it
be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall
be expressly set forth by specific reference in such a filing.
Forward-Looking Statements
This Current Report on Form 8-K contains “forward-looking
statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, including statements regarding
the development of the Union County Campus, the availability and expansion of power, the acquisition of adjacent land, the achievement
of development milestones and related issuances of Series A Preferred Stock, and any stockholder approval required under Nasdaq Listing
Rule 5635. Actual results could differ materially, including as a result of the Company’s need to raise substantial additional capital
to fund its artificial intelligence and high-density compute infrastructure strategy, the receipt of Entergy Arkansas, LLC’s consent
to assignment of the electric service agreement, and the other risks described in the Company’s filings with the Securities and
Exchange Commission. The Company undertakes no obligation to update these statements except as required by law.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. |
|
Description |
| 2.1 |
|
Membership Interest Purchase Agreement, dated as of July 31, 2026, by and among Z Squared Inc., Paradox Infrastructure LLC, Paradox Data, LLC, and the Owner Parties named therein (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed August 4, 2026). |
| 3.1* |
|
Certificate of Designation of Preferences, Rights and Limitations of the Series A Convertible Preferred Stock, filed with the Secretary of State of the State of Delaware on September 8, 2026. |
| 10.1* |
|
Triple Net Lease and Relocation Agreement, dated September 8, 2026, by and among Paradox Data LLC, Paradox Infrastructure LLC and Z Squared Inc. |
| 10.2* |
|
Intercompany Power Access and Cost-Sharing Agreement, dated September 8, 2026, by and between Paradox Data LLC and Paradox Infrastructure LLC. |
| 10.3* |
|
Assignment of Membership Interests, dated as of September 8, 2026, by and between Paradox Infrastructure LLC and Z Squared Inc. |
| 99.1* |
|
Press Release dated September 9, 2026, titled “Z Squared Acquires Energized Arkansas Campus to Advance AI Infrastructure Strategy.” |
| 104 |
|
Cover Page Interactive Data File (embedded within the Inline XBRL document) |
Certain schedules and exhibit have been omitted pursuant to Item 601(a)(5)
of Regulation S-K. The Company agrees to furnish supplementally a copy of any omitted schedule or exhibit to the Securities and Exchange
Commission upon request.
SIGNATURE
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: September 14, 2026
| |
Z SQUARED INC. |
| |
|
| |
By: |
/s/ David Halabu |
| |
Name: |
David Halabu |
| |
Title: |
Chief Executive Officer |
Exhibit 99.1
Z Squared Acquires Energized Arkansas Campus to Advance AI Infrastructure
Strategy
Union County Campus has existing electric service of up to approximately
8.0 MW and a phased development target of an estimated 150+ MW
FT. LAUDERDALE, Fla., Sept. 9, 2026 /PRNewswire/ -- Z Squared Inc.
(Nasdaq: ZSQR) (“Z Squared” or the “Company”) today announced the closing of its acquisition of Paradox Data, LLC
from Paradox Infrastructure LLC, bringing the energized Union County Campus in El Dorado, Arkansas (the “Union County Campus”),
into its computing infrastructure portfolio. The acquisition gives Z Squared its first owned, energized campus and a site from which to
advance its planned AI colocation business.
The campus has electric service already flowing under an existing interruptible
service arrangement with Entergy Arkansas, LLC for up to approximately 8.0 MW. That existing grid connection provides a starting point
for phased conversion into high-density space for customers that bring and operate their own computing equipment.
Paradox Data, LLC also holds contractual rights to acquire adjacent
land and a development pathway targeting 150+ MW of AI-ready capacity over time through a combination of utility power and on-site generation.
Expansion will depend on additional power arrangements, customer commitments, financing, permitting and construction. Capacity above the
existing service arrangement is a development target and is not currently contracted, energized or delivered.
“In August we told our shareholders to judge us on four things:
whether the Paradox acquisition closes, whether we sign our first paying tenant and megawatt commitments, whether energized capacity at
Union County grows beyond the current 8 megawatts, and whether we add sites without taking on debt,” said David Halabu, Chief Executive
Officer of Z Squared. “We have met our first goal. We closed, we paid in stock, and we took on no debt to do it. Union County gives
us power already flowing, land under contract for expansion, and a path to pursue 150+ megawatts of AI-ready capacity. The work now is
the first phase: the engineering, the power planning and the first customer commitment. We will report against those same four measures
as we go. Our intention is for Union County to be the first owned campus rather than the only one, subject to the same discipline we have
applied here.”
Advancing the First Phase
With the acquisition complete, Z Squared’s near-term priorities at
Union County include first-phase high-density electrical and cooling design, utility and on-site generation planning, advancing the adjacent
land acquisition, and securing the first binding customer request for service.
As previously announced, the Company has engaged A2 Advisors, a strategic
advisory and executive management firm focused on digital infrastructure, to support site-development planning, project delivery, vendor
and partner alignment, and leasing and capital strategy at the campus.
Union County is intended to contribute to Z Squared’s previously announced
Phase 1 objective of developing 100 MW of AI-ready capacity across multiple U.S. sites. The Company’s approach is to acquire energized,
grid-connected properties and deploy conversion capital site by site against customer commitments and operational readiness.
The acquisition was completed entirely in stock, with no cash paid
at closing and no debt financing incurred for the transaction.
Additional information regarding the transaction, including the material
terms of the purchase agreement, is contained in the Company’s Current Reports on Form 8-K filed or to be filed with the U.S. Securities
and Exchange Commission.
About Z Squared Inc.
Z Squared Inc. is a computing infrastructure company operating advanced
computing equipment and expanding into AI infrastructure. The Company’s strategy is built on three principles: lead with power by acquiring
operating sites where power is already flowing; build for AI workloads by converting that capacity into AI-ready colocation where the
customer brings the compute and runs what they need; and scale with discipline by deploying conversion capital site by site, against signed
contracts and operational readiness. Z Squared’s common stock began trading on the Nasdaq Global Market under the symbol “ZSQR”
in April 2026.
For more information, visit www.zsquaredinc.com. Investor Relations
Contact:
ZSQR@mzgroup.us
Forward-Looking Statements
This press release contains “forward-looking statements”
within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, that are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking
statements may be identified by the use of words such as “may,” “will,” “should,” “expects,” “plans,”
“anticipates,” “intends,” “targets,” “projects,” “believes,” “estimates,”
“potential,” “continue,” “could,” “would,” “goal,” “objective,” “pursue”
or “seek,” or the negatives of these terms or other comparable terminology. Forward-looking statements in this press release
include, among others, statements regarding the development and conversion of the Union County Campus into AI-ready colocation capacity;
targeted campus capacity of 150+ MW; the availability and expansion of utility power and on-site generation; the acquisition of adjacent
land; customer commitments; the achievement of development milestones and issuance of related preferred stock; the Company’s previously
announced Phase 1 objective of developing 100 MW of AI-ready capacity across multiple U.S. sites; the expected contributions of A2 Advisors;
the assignment to Paradox Data, LLC of the existing electric service agreement with Entergy Arkansas, LLC and the receipt of Entergy’s
consent thereto; the Company’s ability to obtain any stockholder approval required under Nasdaq listing rules in connection with the issuance
of shares of common stock upon conversion of the preferred stock; the potential conversion or redemption of the Series A Convertible Preferred
Stock; the Company’s intention to acquire additional sites without incurring debt; and the Company’s strategy and planned expansion into
AI infrastructure, data center development and power generation.
Forward-looking statements are based on management’s current expectations
and assumptions and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or
implied, including, among others: the Company’s ability to continue as a going concern and obtain financing for development; the risk
that development milestones are not achieved in whole or in part; the Company’s ability to obtain stockholder approval under Nasdaq Listing
Rule 5635 to the extent required for issuances of common stock in excess of the applicable share cap, and the Company’s obligation to
satisfy the affected portion of any milestone payment in cash if such approval is not obtained; risks related to the availability, cost
and interruptible nature of electric power at the Union County Campus, including the receipt of Entergy Arkansas, LLC’s consent to the
assignment of the existing electric service agreement, and the Company’s ability to secure additional utility power and on-site generation;
risks related to the adjacent land acquisition, permitting, construction, equipment procurement and development of data center capacity;
customer demand for AI-ready capacity and the Company’s ability to secure binding customer commitments; the Company’s ability to integrate
the acquired business and realize the anticipated benefits of the acquisition; dilution resulting from the issuance and conversion of
preferred stock issued in the transaction; volatility in digital asset prices and the economics of the Company’s mining operations; the
Company’s ability to maintain compliance with the continued listing standards of The Nasdaq Stock Market; the Company’s ability to remediate
the material weaknesses in its internal control over financial reporting; and the other risks and uncertainties described under “Risk
Factors” in the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2026, its Registration Statement on Form S-1
(File No. 333-296653) and its other filings with the U.S. Securities and Exchange Commission (Commission File No. 001-39669), available
at www.sec.gov.
Capacity above the existing service arrangement remains a development
target and is not currently contracted, energized or delivered. No milestone has been achieved and achievement is not assured.
Forward-looking statements speak only as of the date of this press
release. Except as may be required by applicable law, the Company undertakes no obligation to update or revise any forward-looking statement,
whether as a result of new information, future events or otherwise. You should not place undue reliance on any forward-looking statement.
SOURCE Z Squared Inc.
