Zerostack Corp. current report, 19 July 2023

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Business Context and Reporting Period

This Form 8-K was filed by Flora Growth Corp., not Zerostack Corp. The report concerns events occurring July 19, 2023, with the filing signed and press release dated July 25, 2023. Flora Growth is an Ontario corporation whose common shares trade on the Nasdaq Capital Market under “FLGC.”

Key Financial and Operating Information

  • The filing does not provide revenue, profit, cash flow, margin, debt, liquidity, or balance-sheet figures.
  • The company reported an update regarding the sale of its Colombian-related subsidiaries.
  • Flora Growth stated that its previously issued revenue guidance should no longer be relied upon as a result of the sale.

Material Changes Versus the Prior Comparable Period

  • Matthew Cohen resigned as General Counsel effective July 19, 2023.
  • The resignation was attributed to personal reasons and was stated not to result from any disagreement with the company or its board regarding operations, policies, or practices.
  • The sale of Colombian-related subsidiaries materially affected the reliability of previously issued revenue guidance.

Guidance, Outlook, Risks, and Unusual Items

  • Prior revenue guidance has been withdrawn or should no longer be relied upon following the Colombian subsidiary sale.
  • The filing does not provide replacement revenue guidance or a revised outlook.
  • The sale may create a material change in the company’s operating profile and reported revenue base, but the filing text does not provide transaction terms, expected proceeds, timing, accounting treatment, or the subsidiaries’ financial contribution.
  • The Regulation FD disclosure and attached press release were furnished rather than filed for purposes of Section 18 of the Exchange Act, except where expressly incorporated by reference.

Investor Verification Items

  1. Confirm the identity discrepancy: the provided metadata names Zerostack Corp., while the filing identifies Flora Growth Corp.
  2. Review Exhibit 99.1 for the status, terms, timing, and financial impact of the Colombian subsidiary sale.
  3. Determine whether Flora Growth issued revised revenue guidance after withdrawing its prior guidance.
  4. Assess the revenue and profitability contribution of the divested Colombian operations.
  5. Verify whether a permanent or interim replacement for the General Counsel was appointed.