Business Context and Reporting Period
Zerostack Corp. (ZeroStack), an Ontario corporation trading on the NASDAQ Capital Market under the symbol FLGC, filed this Form 8-K on March 31, 2026. The report details a series of material definitive agreements executed on March 31, 2026, involving the acquisition of a Texas-based blocker corporation ("Texas Blocker") and the settlement of a prior debt obligation. ZeroStack is classified as an emerging growth company.
Key Financial Metrics and Transaction Values
The filing does not provide standard financial statements (revenue, profit, cash flow, or margins) for the reporting period. However, it discloses specific transaction valuations:
- Token Contribution: Investors contributed 142,232,948 Zero Gravity (0G) native tokens.
- Token Valuation: The fair market value of each Token was deemed to be US$0.7549.
- Blocker Shares Issued: Texas Blocker issued 9,104,614 shares to investors.
- Blocker Share Valuation: The fair market value of each Blocker Share was deemed to be US$11.7931.
- Debt Settlement: ZeroStack settled a convertible note by paying 50,000,000 Tokens to Zero Gravity Labs Inc.
Material Changes and Agreements
The filing reports three primary material changes effective March 31, 2026:
- Securities Contribution Agreements: Texas Blocker, formed by ZeroStack's CEO and CFO, received 0G tokens from investors in exchange for Blocker Shares. This transaction closed on March 31, 2026.
- Share Exchange Agreement: ZeroStack agreed to exchange 9,104,614 of its common shares or pre-funded warrants for all outstanding Blocker Shares. Upon closing, Texas Blocker will become a wholly-owned subsidiary of ZeroStack. The closing is expected on or about March 31, 2026.
- Note Settlement: ZeroStack settled a token-denominated convertible note with Zero Gravity Labs Inc. by transferring 50,000,000 Tokens, satisfying all principal and interest obligations.
Outlook, Risks, and Contingencies
Conditions Precedent: The Share Exchange is contingent upon ZeroStack shareholder approval to issue securities under Nasdaq rules and written consent from Texas Blocker stockholders. ZeroStack has agreed to file a Form S-3 registration statement for the resale of the securities.
Tax Implications: Upon consummation of the Exchange, ZeroStack expects to be classified as a U.S. domestic corporation for U.S. federal income tax purposes under Section 7874(b) of the Internal Revenue Code.
Restrictions: The Stockholders' Agreement restricts the transfer of Blocker Shares and limits Texas Blocker's ability to enter into new business commitments without unanimous stockholder and board approval, except for activities furthering the Exchange, token staking, or tax-planning arrangements.
Unregistered Sales: The ZeroStack Shares and Pre-funded Warrants are being offered pursuant to exemptions under Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D.
Investor Verification Checklist
- Verify the status of the required ZeroStack shareholder approval for the issuance of 9,104,614 shares/warrants.
- Confirm the filing and effectiveness of the Form S-3 registration statement for the resale of securities.
- Assess the impact of the reclassification as a U.S. domestic corporation on ZeroStack's tax liabilities and financial reporting.
- Review the full text of the Securities Contribution Agreement and Share Exchange Agreement (Exhibits 10.1 and 10.2) for specific covenants and indemnification terms.
- Monitor the valuation volatility of the 0G tokens, as the transaction values were based on a deemed fair market value of US$0.7549 per token.