Uniserve Closes Acquisition of Business of Megawire Inc.

Executive Summary

• Uniserve closed a $6.5 million transaction acquiring all assets of Megawire Inc., plus equity interests in Brimax Financial Services Inc. ($2.4 M cash) and Waterloo Wireless Inc. (via a convertible note valued at $2.1 M).
• The deal was funded through a combination of share issuances, cash payments, a $2.5 million related‑party loan (with 3.5 million warrants), and a convertible note bearing 7% interest.
• The acquisitions are expected to expand Uniserve’s managed IT service footprint in Ontario/eastern Canada, increase recurring revenue, and generate strong top‑line sales and EBITDA growth.

Key Details

• Total Purchase Price: $6,500,000.
• Megawire Asset Purchase (APA):
• Issued 3,431,961 Uniserve common shares at $0.5828 per share = $2,000,000 equity consideration.
• 2,573,971 shares issued directly to Megawire; 857,990 placed in escrow pending margin adjustments (hold period expires April 23 2026).
• Post‑closing gross‑margin benchmark adjustment clause (≤7% variance expected, no material impact anticipated).
• Brimax Share Purchase Agreement (SPA):
• Paid $2,400,000 cash; $2,150,000 to Brimax shareholders, $250,000 held in escrow for possible purchase‑price adjustments.
• Adjustment Amount set at $0; no material adjustment expected.
• Waterloo Wireless Share Purchase Agreement (SPA):
• Paid $2,100,000 via a non‑transferable convertible note (3‑year term, 7% annual interest, monthly payments).
• Note conversion rights: up to 50% of outstanding principal may be converted into Uniserve shares at tiered prices ($0.75 in Year 1, $1.00 in Year 2, $1.25 in Year 3).
• Pre‑payment and anniversary cash/share election provisions; 10% blocker clause limits holder’s ownership to <10%.
• Guarantee & Security: Waterloo provided a guarantee and first‑priority security interest over all present and after‑acquired property for the note.
• Megawire Assets Acquired: Goodwill, IP, ~US$100 k inventory, lease in Waterloo, vehicle leases, tower licenses; excludes corporate entity, cash, working capital, indebtedness, employee contracts, IPv4 numbers.
• Employment & Consulting: Uniserve will offer employment to all Megawire staff on comparable terms; entered a 12‑month Management Services Agreement with Emerald Flow Consulting ($225 k total fee). Non‑competition agreements signed for 24 months.
• Lease Commitment: 10‑year lease for ~9,450 sq ft office space in Waterloo (≈$31 k/month).
• Related‑Party Loan & Warrants:
• Borrowed $2,500,000 from insider 369 Terminal Holdings Ltd. (8% annual interest, payable on demand, monthly interest).
• Issued 3,500,000 non‑transferable warrants at $0.57 per share, exercisable until Dec 22 2026; subject to a four‑month hold period (expires Apr 23 2026).
• $2.4 M of loan proceeds funded Brimax purchase; remaining $100 k for working capital/transaction expenses.
• Regulatory Note: Loan qualifies as a related‑party transaction under MI 61‑101 but is exempt from valuation and minority‑shareholder approval (≤25% market cap).
• Director Appointment: Steven Maxwell appointed director on Nov 26 2025 (previously announced).
• Warrant Withdrawal: Company withdrew application to issue 1,000,000 common share purchase warrants related to a Vancouver lease.

Notable Quotes

“The acquisition of this MSP will further enhance the depth of services that Uniserve will deliver and strengthen our datacenter portfolio… We expect this acquisition to bring strong top line sales and an expected EBITDA to the organization which will provide a solid platform for us to scale up operations in Ontario.” – Kwin Grauer, Acting Interim CEO & Chairman of the Board