ZeroStack Corp. 8-K

What Happened

• ZeroStack Corp. announced a series of transactions dated March 31, 2026 in which investors contributed 142,232,948 native Zero Gravity (0G) blockchain tokens to a newly formed Texas Blocker Corp. in exchange for 9,104,614 Texas Blocker common shares. Those Blocker shares will be exchanged one-for-one for an aggregate of 9,104,614 ZeroStack common shares and/or pre-funded warrants (the “Exchange”), after required shareholder approvals. Closing of the Contribution occurred on March 31, 2026 and the Exchange was expected on or about March 31, 2026.
• Separately, ZeroStack settled a token‑denominated convertible note with Zero Gravity Labs Inc. by agreeing to pay 50,000,000 Tokens on or before March 31, 2026, after which the note is deemed paid in full and the parties provided mutual releases.

Key Details

• Investors contributed 142,232,948 Tokens (valued at $0.7549 per Token) in exchange for 9,104,614 Texas Blocker shares (valued at $11.7931 per share), a total implied value of roughly $107.4 million.
• ZeroStack will issue an aggregate of 9,104,614 ZeroStack common shares and/or pre-funded warrants in the Exchange; Texas Blocker will become a wholly owned subsidiary upon closing.
• ZeroStack agreed to file a Form S-3 resale registration statement covering the issued ZeroStack Shares, pre-funded warrants and the shares issuable upon exercise.
• The settlement with Zero Gravity Labs requires delivery of 50,000,000 Tokens to extinguish the convertible note and releases both parties from further claims under the note.

Why It Matters

• Dilution and capital structure: issuing up to 9.1 million ZeroStack securities will increase outstanding securities and can dilute current shareholders’ ownership depending on the form and exercise of the pre-funded warrants.
• Balance sheet and liabilities: settling the convertible note with Tokens removes that debt obligation from ZeroStack’s obligations to Zero Gravity Labs, which could simplify the company’s capital structure and reduce cash outflow (but involves token transfers).
• Corporate and tax implications: upon closing, ZeroStack expects to be treated as a U.S. domestic corporation for U.S. federal tax purposes under Section 7874(b), a change that can have important tax and reporting consequences.
• Approvals and transfer restrictions: the Exchange is subject to ZeroStack shareholder approval under Nasdaq rules and Texas Blocker stockholder consents; the Blocker stockholders’ agreement also restricts transfers and limits Texas Blocker’s activities without unanimous stockholder and board approval.

Keywords: exchange, tokens, pre-funded warrant, note settlement, dilution, shareholder approval, Form S-3, Section 7874.