Mr. Ghassan Halazon reports

EMERGE SIGNS DEFINITIVE AGREEMENT TO ACQUIRE VIRAL LOOPS, A PROFITABLE B2B REFERRAL MARKETING PLATFORM, ANNOUNCES $1.8M PRIVATE PLACEMENT

Emerge Commerce Ltd. has signed a definitive agreement dated effective Feb. 19, 2026, through its wholly owned subsidiary, Emerge Brands Inc., to acquire substantially all assets of Viral Loops and specified liabilities from Wishpond Technologies Ltd. (the seller).

Founded in 2016, Viral Loops is a highly profitable, B2B (business-to-business) referral marketing platform that enables businesses to design and manage subscription-based referral programs that drive word of mouth, increase retention and reduce customer acquisition costs.

Viral Loops operates an asset-light, recurring-revenue model with high gross margins and strong cash flow conversion. The business serves a diversified base of global B2B customers.

For the year ended Dec. 31, 2025, Viral Loops generated $1.3-million in revenue, with gross margins of approximately 86 per cent and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $800,000 (approximately 62-per-cent adjusted EBITDA margin), based on unaudited results.

Viral Loops will continue to maintain its team, brand, website and its hundreds of client relationships under Emerge.

Strategic and financial rationale

Viral Loops is Emerge's first acquisition under its newly formed Emerge B2B vertical, designed to complement and strengthen the company's overall portfolio:

• Portfolio synergies: Viral Loops' referral technology is expected to be deployed across Emerge's direct-to-consumer (D2C) grocery and golf verticals to drive cost-effective customer acquisitions and word-of-mouth campaigns;
• Improved financial profile: The transaction is expected to be immediately accretive to earnings and cash flow, materially improving Emerge's consolidated margin profile:
  • Enhances gross margin: Viral Loops' gross margin of 86 per cent (2025) versus Emerge's reported average of 36 per cent year to date 2025;
  • Strengthens adjusted EBITDA: inclusive of Viral Loops, Emerge's pro forma 2025 adjusted EBITDA would have been $2.2-million, an approximately 52-per-cent increase;
  • Return on invested capital (ROIC) expected to exceed 25 per cent in Year 1;
  • High EBITDA-to-cash-flow conversion given the asset-light nature of the business model (no inventory);
  • Reduced seasonality and improved earnings stability: Viral Loops generates recurring revenue throughout the year, which is expected to reduce the seasonality inherent in Emerge's consumer-facing businesses and enhance overall earnings stability.

Transaction overview

Pursuant to the agreement and in consideration for the transaction, Emerge has agreed to pay to the seller cash consideration of $2.1-million on closing of the transaction, subject to certain closing adjustments, and $200,000 in deferred cash consideration at the one-year anniversary.

The purchase price equates to an approximately 2.9 times 2025 adjusted EBITDA multiple.

At Dec. 31, 2025, Viral Loops had total assets of approximately $1.2-million. The company is also assuming deferred revenue liability estimated to be approximately $100,000 (U.S.) at closing.

Subject to the satisfaction of all conditions precedent to the completion of the transaction, including receipt of TSX Venture Exchange approval, closing is expected to occur prior to March 30, 2026, or such other date as Emerge and the seller may mutually agree.

The transaction constituted an expedited acquisition in accordance with Policy 5.3 of the TSX-V; however, it remains subject to the approval of the TSX-V as of the date of this news release.

No finders' fees are expected to be paid in connection with the transaction.

Go-forward business

Following the transaction, Emerge will have five brands across three verticals. The D2C business will include the grocery and golf verticals while Emerge B2B will include Viral Loops.

Ghassan Halazon, Emerge's founder and chief executive officer, commented: "Viral Loops is precisely the type of high-margin, recurring revenue business we aim to acquire -- profitable, cash flow generative and strategically complementary to our portfolio. At approximately 2.9 times adjusted EBITDA, we believe this transaction reflects disciplined capital allocation with compelling immediate returns. We are impressed with the lean team running the business and their tech-forward AI [artificial intelligence] road map that we believe has the potential to both take Viral Loops to the next level as well as supercharge the overall Emerge portfolio."

Private placement

The company is pleased to announce a non-brokered private placement financing of 18 million units of the company at a price of 10 cents per unit for aggregate gross proceeds of $1.8-million in all provinces of Canada. Each unit consists of one common share in the capital of the company and one-half of one common share purchase warrant, with each warrant exercisable for a period of 24 months from the date of issuance at an exercise price of 15 cents per share, subject to the policies of the TSX-V in relation to exercise price for warrants for part-and-parcel private placement.

The company intends to allocate the net proceeds of the offering toward the purchase price associated with the transaction. The company intends to satisfy the balance of the consideration with funds on hand. The consideration will not be satisfied with securities of the company.

The closing of the offering is subject to certain conditions, including, but not limited to, the submission of all required forms to the TSX-V and the closing of the offering.

The company may pay to any applicable finder a cash commission of up to 6 per cent of the gross proceeds of the offering and may issue finder warrants of up to 6 per cent of the units sold under the offering, with each broker warrant exercisable to acquire one share at an exercise price of 10 cents, for a period of 24 months from the date of issuance thereof.

All securities issued pursuant to the offering are subject to a statutory hold period of four months from the date of issuance in accordance with applicable securities laws.

The company expects certain related parties as defined in Multilateral Instrument 61-101, Protection of Minority Security Holders in Special Transactions, to participate in the offering. Any such resulting related party participation is expected to be exempt from the formal valuation requirement and shareholder approval requirement of MI 61-101 as the fair market value of any units issued to such persons will not exceed 25 per cent of the company's market capitalization.

Loan amendment

The company wishes to clarify its news release date Feb. 18, 2026, regarding the credit facility amendment. As disclosed in its previous news release, the amended facility provides for a 20-month extension of the credit facility, bringing its maturity to October, 2027. As of the date of this news release, the current outstanding balance of the credit facility is $5.85-million. A fee of $58,500 will be paid in cash in connection with the amendment to the credit facility. The amendment remains subject to the approval of the TSX-V. The amendment does not preclude the company from refinancing its credit facility at a cheaper rate, at any time, should it secure more favourable terms.

"The acquisition of Viral Loops is expected to substantially enhance Emerge's profitability and cash flow profile, strengthen the company's balance sheet, and potentially improve our cost of capital over time," continued Mr. Halazon.

About Emerge Commerce Ltd.

Emerge is a portfolio of premium e-commerce brands and technologies. Emerge's subscription, marketplace and retail businesses provide the company's members with access to offerings across the company's grocery and golf verticals. truLocal is Emerge's flagship Canadian meat and seafood subscription service, connecting local farmers with a health-conscious audience. Emerge's golf vertical includes the company's discounted tee times/experiences brand, UnderPar, and Emerge's discounted golf apparel and equipment brands, JustGolfStuff and Tee 2 Green. Emerge is publicly traded on the TSX-V under the symbol ECOM.

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