PMGC Holdings Inc. 8-K

What Happened
PMGC Holdings Inc. (ELAB) announced it completed the acquisition of 100% of SVM Machining, Inc. on February 2, 2026. The aggregate purchase price was $2,449,148.08, consisting of $2,250,000 in purchase cash (with $2,000,000 paid at closing and $250,000 held back for indemnity claims), a $130,000 cash balance, and a $69,148 net working capital adjustment subject to post‑closing true‑up. PMGC also entered a lease for the Target’s real property and a four‑week Transition Services Agreement with an affiliate of the seller for $19,200.

Key Details

• Closing date: February 2, 2026. Total stated purchase price: $2,449,148.08.
• Cash paid at closing: $2,000,000; Holdback retained: $250,000 for indemnities.
• Working capital: $130,000 cash balance + $69,148 excess over target; final amount subject to post‑closing accounting adjustment.
• Earnouts: Tier 1 up to $750,000 (12 months ending Dec 31, 2026 — $1 of earnout per $1 of revenue above $2.5M up to $3.25M); Tier 2 up to $500,000 (12 months ending Dec 31, 2027 — $0.50 per $1 of revenue above $3.5M up to $4.5M). Earnouts payable within 10 days after filing the Company’s Form 10‑K for the applicable fiscal year.
• Seller covenants: 3‑year non‑compete and 3‑year non‑solicitation in California. Transition services fee: $19,200 for 4 weeks.
• Exhibits: press release filed as Exhibit 99.1; combined financial statements of SVM Machining for FY2023 and FY2024 and unaudited nine months ended Sept 30, 2025 filed as Exhibit 99.2.

Why It Matters
This is a cash‑and‑earnout acquisition that expands PMGC’s capabilities into precision machining/custom component manufacturing through an established California business. The immediate cash outlay at closing was ~$2.0M (with $250k held back and subsequent true‑ups possible), and additional contingent payments of up to $1.25M are possible if revenue targets are met over the next two years. Investors should note the near‑term cash impact, potential future earnout liabilities tied to revenue performance, the short transition services term and modest fee, and the seller’s post‑closing non‑compete which helps protect the acquired customer base. Financials for the acquired business are included in the filing for review.