Z Squared Signs Definitive Agreement to Acquire Paradox Data and Union County AI Data Center Campus

Z Squared has announced the signing of a definitive agreement to acquire 100% of the membership interests of Paradox Data from Paradox Infrastructure, marking a significant step forward in the company's strategy to expand its AI-ready data center footprint across the United States. The transaction, initially structured as a majority interest acquisition under a binding letter of intent announced on June 25, 2026, has been expanded to a full acquisition, reflecting the growing strategic importance of the target assets.

The flagship asset in the deal is the Union County Campus, located at 713 Industrial Road in El Dorado, Arkansas. The site currently benefits from an existing electric service arrangement with Entergy Arkansas, providing energy service of up to 8.0 MW. It also includes an executed land contract for the acquisition of adjacent land, and a development pathway targeting up to 150 MW of AI-ready capacity over time through a combination of utility power and on-site generation. This acquisition directly supports Z Squared's previously announced Phase 1 objective of developing 100 MW of AI-ready capacity for workloads across multiple U.S. sites, positioning the company to meet growing demand from AI and high-performance computing applications.

The transaction is structured entirely as non-cash consideration, consisting of newly designated Series A Convertible Preferred Stock of Z Squared, with no cash payable at closing and no debt financing involved. At closing, Z Squared will issue $5.0 million of Series A Convertible Preferred Stock, convertible into common stock at a fixed conversion price of $7.45 per share. In addition, up to $20.0 million of additional convertible preferred stock may be earned upon the achievement of four defined development milestones at the Union County Campus. The first milestone is tied to the initial energization of AI compute capacity at the existing site, while the remaining three are tied to aggregate site capacity thresholds of 50 MW, 100 MW, and 150 MW. Each milestone payment is earned in installments upon receipt of binding requests for service for the additional capacity and upon the energization of that capacity.

To support the development of the Union County Campus, Z Squared has engaged A2 Advisors, a strategic advisory and executive management firm focused on digital infrastructure, including data centers, power, real estate, and the capital markets that support them. A2 Advisors is expected to provide support across site development planning, project delivery, vendor and partner alignment, and leasing and capital strategy for the campus build-out, bringing operator-level execution experience to each phase of the development. Notably, Mr. Harris, Z Squared's Chief Technology Officer, holds an indirect minority ownership interest in Paradox Infrastructure, the seller in the transaction, and Paradox Energy, the recipient of the milestone proceeds.

David Halabu, Chief Executive Officer of Z Squared, commented on the deal structure, stating, "This is 'scale with discipline' in contract form. Eighty percent of the total consideration is earned only as the Union County Campus achieves defined execution milestones: capacity requested, then capacity energized. This deal structure keeps our acquisition currency aligned with execution and continues to closing this transaction quickly." Jeffery Harris, Chief Technology Officer of Z Squared, added, "We are excited to be building a highly efficient, technology driven data center with the help of A2 Advisors. Following closing, our focus will be the utility, generation, engineering and customer workstreams required to move toward large scale capacity."

The acquisition underscores a broader industry trend toward milestone-based, equity-backed transactions in the data center sector, as developers seek to align capital deployment with measurable operational progress. By tying a substantial portion of the consideration to the successful energization of capacity, Z Squared is mitigating execution risk while maintaining a clear path to scaling its AI-ready infrastructure portfolio. The Union County Campus, with its existing utility arrangements and expansion potential, represents a strategic asset in the company's multi-site development pipeline, and the involvement of A2 Advisors signals a focus on disciplined, operator-led execution as the project moves toward large-scale capacity delivery.