Greenlane: UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION – Form 8-K/A


UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION

Introduction

On July 19, 2022, Warehouse Goods LLC, a wholly owned subsidiary of Greenlane Holdings, Inc. (the “Company”) entered into a membership interest purchase agreement and supporting documents (collectively, the “Membership Agreement”). sale”) with Portofino Partners LLC, a Delaware limited liability company (the “Purchaser”), to sell the Company’s 50% interest in VIBES Holdings LLC (“VIBES”), for a total consideration of 5, 3 million in cash (collectively, the “Sale”). The transactions contemplated by the Sale Agreement were entered into on July 19, 2022, immediately following the signing of the Sale Agreement (collectively, the “Sale”).

The Buyer is an entity partially controlled by Adam Schoenfeld, former marketing director and co-founder of the Company and member of the board of directors of the Company (the “Board”). The sale agreement was approved by the affirmative vote of a disinterested majority of the members of the board and the audit committee of the board in accordance with the Company’s related party transaction policy.

The following unaudited pro forma condensed consolidated financial information is presented in accordance with the rules specified by Section 11 of Regulation SX promulgated by the United States Securities and Exchange Commission (the “SEC”) and has been prepared subject to the assumptions and adjustments described in the accompanying notes. Specifically, the unaudited pro forma condensed consolidated financial information presented below reflects the effects of the Sale on (i) the Company’s condensed consolidated balance sheet as of March 31, 2022, as if the Sale had occurred on that date, and (ii) The condensed consolidated statement of earnings of the Company for the three months ended March 31, 2022 and the year ended December 31, 2021, as if the sale had occurred on January 1, 2021. Management believes that the assumptions used and the adjustments made are reasonable in the circumstances and in light of the information available.

The following unaudited pro forma condensed consolidated financial statements are derived from historical financial statements prepared in accordance with United States generally accepted accounting principles (“US GAAP”). The pro forma adjustments reflect the impacts of events directly attributable to the sale, which are factually justifiable, and for the purposes of the unaudited pro forma condensed consolidated statements of earnings, which are expected to have a continuing impact on the Company. The following unaudited pro forma condensed consolidated financial information is provided for illustrative and informational purposes only and is not necessarily indicative of the financial condition or results of operations of the Company that would have occurred had the Sale occurred on the dates indicated. , or indicative of the Company’s future financial condition or results of operations.

The unaudited pro forma condensed consolidated financial information should be read in conjunction with the following:

•The notes to the unaudited pro forma condensed consolidated financial statements;

• Greenlane’s unaudited condensed consolidated financial statements as of and for the three months ended March 31, 2022, included in its Quarterly Report on Form 10-Q for the three months ended March 31, 2022; and

• Greenlane’s audited consolidated financial statements as of and for the year ended December 31, 2021, included in its Annual Report on Form 10-K for the year ended December 31, 2021.

The historical condensed consolidated statement of income for the year ended December 31, 2021 has been adjusted by the Company’s management to reflect certain reclassifications to conform with the current financial statement presentation.

GREENLANE HOLDINGS, INC.

UNAUDITED CONDENSED PRO FORMA CONSOLIDATED BALANCE SHEET

As of March 31, 2022

(in thousands, except par value per share)

The accompanying notes form an integral part of these unaudited pro forma condensed consolidated financial statements.

GREENLANE HOLDINGS, INC.

CONDENSED UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME

For the three months ended March 31, 2022

(in thousands, except per share amounts)

The accompanying notes form an integral part of these unaudited pro forma condensed consolidated financial statements.

GREENLANE HOLDINGS, INC.

CONDENSED UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME

For the year ended December 31, 2021

(in thousands, except per share amounts)

The accompanying notes form an integral part of these unaudited pro forma condensed consolidated financial statements.

NOTES TO THE COMBINED UNAUDITED PRO FORMA CONDENSED FINANCIAL INFORMATION

Unaudited pro forma adjustments

The following is a summary of the unaudited pro forma adjustments reflected in the unaudited pro forma condensed consolidated financial statements based on preliminary estimates, which may change as additional information becomes available.

has. Reflects amounts originally reported by the Company in its Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2022.

b. Reflects amounts originally reported by the Company in its Annual Report on Form 10-K for the fiscal year ended December 31, 2021, adjusted to reflect the voluntary change in accounting principle made by the Company to classify shipping and handling charges outflows associated with the distribution of products to our customers as a component of “general and administrative” expenses in our condensed consolidated statements of income. These costs were previously recorded as a component of “cost of sales” in our condensed consolidated statements of earnings.

vs. Reflects the elimination of historical assets, liabilities and equity balances of VIBES, including in the company’s consolidated financial statements. The amount of the actual gain will be calculated based on the net book value of the business sold at the closing of the sale and therefore could differ from the current estimate.

d. Reflects estimated net sale proceeds of $4.6 million, representing gross purchase price of $5.3 million, offset by cash proceeds of $0.7 million used to settle amounts due on certain current purchase orders.

e. Reflects the elimination of historical revenues and expenses directly related to VIBES that will not recur in the Company’s consolidated statement of income beyond one year from the date of the Sale, as well as the related adjustment the net loss attributable to VIBES’ historic Minority Interest.

Previous Saudi Central Bank launches joint operations center to fight financial fraud
Next Pvt Bank staff detained for deceiving a client | News Trichy