Zone Frontier Inc.
For the period ended Mar 31, 2025. Filed May 14, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 14, 2025
ZONE$3.08-14.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-12-31; filed 2025-02-14.
0001213900-25-013826
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-14.
0001213900-25-043325
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 62 previous paragraphs and 77 current paragraphs.
33 unchanged; 26 reworded; 18 added; 3 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 20 previous and 26 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (18)
Current report
Closing of Acquisition
Current report
On February 21, 2025, CleanCore Global entered into an Asset Purchase Agreement, which was amended on April 15, 2025, or the Purchase Agreement, with Sanzonate Europe Ltd., an Irish incorporated company, or the Seller, and Sanzonate Global Inc., the majority stockholder of the Seller, or the Stockholder, pursuant to which CleanCore Global agreed to acquire substantially all of the assets of the Seller used in the manufacturer and distribution of aqueous ozone products (which we refer to as the Business).
Current report
On April 15, 2025, the closing of the transactions contemplated by the Purchase Agreement was completed. Pursuant the Purchase Agreement, CleanCore Global acquired all of the assets of the Seller used in the Business for an aggregate purchase price of $2,475,000, consisting of: (i) $425,000 in cash; (ii) the issuance of a promissory note in the principal amount of $800,000; and (iii) up to $1,250,000 in Earn-Out Payments (as defined below). As additional consideration, we issued to the Stockholder a five-year warrant to purchase 425,000 shares of our class B common stock at an exercise price of $1.25 per share.
Current report
As noted above, a portion of the purchase price was paid by the issuance of a 10% subordinated promissory note in the principal amount of $800,000 by CleanCore Global to the Seller. The note bears interest at a rate of ten percent (10%) per annum, payable quarterly, and is due and payable on April 15, 2027. The note may be prepaid at any time without premium or penalty, is unsecured, and contains customary events of default for a loan of this type.
Current report
The Seller is also entitled to receive the following payments (each is referred to below as an Earn-Out Payment) to the extent that Net Sales (as defined in the Purchase Agreement) achieve the following milestones during the five-year period beginning on the closing date and ending on the fifth anniversary of the closing date, or the Earn-Out Period; provided that an Earn-Out Payment will be calculated for each year during the Earn-Out Period. If Net Sales:
Current report
Calculation of the annual Earn-Out Payment will be based upon cumulative Net Sales, meaning that for each year of the Earn-Out Period, the beginning balance of Net Sales will be the ending balance of Net Sales from the prior year of the Earn-Out Period.
Current report
No later than forth-five (45) days following each anniversary of the closing date during the Earn-Out Period, CleanCore Global shall prepare and deliver to the Seller a written statement, or an Earn-Out Statement, setting forth in reasonable detail its determination of unaudited Net Sales within the annual Earn-Out Period and its determination of whether there is a resulting Earn-Out Payment due. To the extent the Seller is entitled to an Earn-Out Payment, the applicable Earn-Out Payment(s) shall be paid on the date that is five (5) business days after the date on which the Earn-Out Statement becomes final and binding on the parties, following resolution of any objections to the Earn-Out Statement pursuant to the terms of the Purchase Agreement.
Current report
The Purchase Agreement contains customary representations, warranties and covenants, including a covenant that the Seller and the Stockholder will not compete with the Business for a period of three (3) years following closing.
Current report
The Purchase Agreement also contains mutual indemnification for breaches of representations or warranties and failure to perform covenants or obligations contained in the Purchase Agreement. The Seller and the Stockholder also indemnified CleanCore Global for (i) any Excluded Liability (as defined in the Purchase Agreement) and (ii) any liability of the Seller which is not an Assumed Liability (as defined in the Purchase Agreement) and which is imposed upon CleanCore Global under any bulk transfer law of any jurisdiction or under any common law doctrine of de facto merger or successor liability so long as such liability arises out of the ownership, use or operation of the assets of the Seller, or the operation or conduct of the Business prior to the closing. CleanCore Global also indemnified the Seller and the Stockholder for (i) any Assumed Liability and (ii) any liability (other than any Excluded Liability) asserted by a third party against any of the Seller or the Stockholder which arises out of the ownership of the Purchased Assets (as defined in the Purchase Agreement) after the closing or the operation by CleanCore Global of the business conducted with the Purchased Assets after the closing.
Current report
In the case of the indemnification provided with respect to breaches of certain non-fundamental representations and warranties, the party will only become liable for indemnified losses if the amount exceeds an aggregate of $30,000. Notwithstanding the foregoing, this threshold limitation shall not apply to claims by CleanCore Global for breaches by the Seller or the Stockholder of certain fundamental representations. In addition, CleanCore Global’s aggregate remedy with respect to any and all indemnifiable losses shall in no event exceed, (i) with respect to claims related to breach of the fundamental representations, the final purchase price, or (ii) with respect to all other claims, 50% of the final purchase price. If, after providing the Seller with a written claim that specifically identifies the basis for indemnification and any relevant facts forming the basis for such claim, resolution of the claim between the parties and the Seller fails to indemnify CleanCore Global within thirty (30) days following the resolution of the claim, CleanCore Global shall have the right to recoup all or any part of any indemnifiable losses it may suffer by notifying the Stockholder that CleanCore Global is reducing the Earn-Out Payments by the amount of such indemnifiable losses.
Current report
Private Placement
Current report
On April 16, 2025, we entered into subscription agreements with several accredited investors for the purchase of (i) promissory notes in the aggregate principal amount of $1,010,000 and (ii) five-year warrants to purchase an aggregate of 134,666 shares of our class B common stock at an exercise price of $1.06 per share for an aggregate purchase price of $1,010,000.
Current report
The notes bear interest at a rate of twelve percent (12%) per annum, payable quarterly, and are due and payable on April 16, 2027. The notes may be prepaid at any time without premium or penalty, are unsecured, and contain customary events of default for a loan of this type.
Current report
Amendments to Promissory Notes
Current report
On May 2, 2025, the promissory note in the principal amount of $316,920 issued to Gary Hollst on December 24, 2024 was amended and restated in its entirety and we issued to Mr. Hollst an amended and restated promissory note in the principal amount of $342,154.57. This note is due and payable on May 31, 2026 and accrues interest at a rate of 8.5% per annum; provided that upon an event of default (as defined in the note), interest shall accrue at a rate of 10% per annum. The note may be prepaid at any time without premium or penalty, is unsecured, and contains customary events of default for a loan of this type. The note may be converted at the holder’s option at any time into shares of our class B common stock at a conversion price of $1.12 (subject to standard adjustments for stock splits, stock dividends, reclassifications and similar transactions).
Current report
On May 2, 2025, we and Clayton Adams, our Chief Executive Officer, entered into a note amendment agreement, pursuant to which the maturity date of the 20% original issue discount promissory note issued to Mr. Adams on January 27, 2025 was changed to require repayment with sixty (60) days of written demand from Mr. Adams.
Current report
On May 2, 2025, we and Travis Buchanan, our President, entered into a note amendment agreement, pursuant to which the maturity date the 20% original issue discount promissory note issued to Mr. Buchanan on January 27, 2025 was changed to require repayment with sixty (60) days of written demand from Mr. Buchanan.
Current report
Comparison of Nine Months Ended March 31, 2025 and 2024
Removed paragraphs (3)
Previous report
On January 27, 2025, Clayton Adams, our Chief Executive Officer, entered into a note sale assignment and cancellation agreement with Travis Buchanan, our President, pursuant to which Mr. Adams sold and assigned $125,000 of the 20% original issue discount promissory note in the principal amount of $415,241.25 issued to Mr. Adams on December 24, 2024 to Mr. Buchanan for a purchase price of $100,000. Following such assignment, we issued a 20% original issue discount promissory note in the principal amount of $125,000 to Mr. Buchanan and a 20% original issue discount promissory note in the principal amount of $290,241.25 to Mr. Adams. These notes are due and payable on June 30, 2025 and accrue interest at a rate of 8% per annum; provided that upon an event of default (as defined in the notes), such interest rate shall increase to 15% per annum. The notes may be prepaid at any time without premium or penalty, are unsecured, and contain customary events of default for loans of this type.
Previous report
In January 2025, we launched a unit offering pursuant to which we are offering to accredited investors, in a private placement transaction, up to 266,667 units, at a purchase price of $7.50 per unit, for gross proceeds of up to $2,000,000; provided that we may increase the offering to 533,333 units for gross proceeds of up to $4,000,000 if there are oversubscriptions. Each unit consists of a 12% unsecured promissory note in the principal amount of $7.50 and a warrant to purchase one share of class B common stock at an exercise price equal to the last closing price prior to the closing date; provided that such exercise price shall not exceed $1.50. The closing will occur, at our discretion, on or before March 1, 2025, at which time we will issue the notes and the warrants. Until closing, all subscription funds received by us will be held in a segregated account. The notes will bear interest at a rate of twelve percent (12%) per annum, payable quarterly, and will be due on the second anniversary of the date of issuance. The notes will provide that they may be prepaid at any time without premium or penalty, will be unsecured, and will contain customary events of default for loans of this type. The warrants will have a five-year term and will be exercisable on a cashless basis if the underlying shares are not freely tradable. In January 2025, we entered into subscription agreements with two accredited investors for the purchase of an aggregate of 53,334 units for an aggregate subscription price of $400,000.
Previous report
Comparison of Six Months Ended December 31, 2024 and 2023
Reworded paragraphs (26)
Previous wording
Except as otherwise indicated by the context and for the purposes of this report only, references in this report to “we,” “us,” “our” and “our company” refer to CleanCore Solutions, Inc., a Nevada corporation.
Current wording
Except as otherwise indicated by the context and for the purposes of this report only, references in this report to “we,” “us,” “our” and “our company” refer to CleanCore Solutions, Inc., a Nevada corporation, and its wholly owned subsidiary CleanCore Global Limited, an Irish company, or CleanCore Global.
Previous wording
Revenue. We generate revenue from sales of our cleaning products. Our revenue decreased by $1,137, or 0.44%, to $257,269 for the three months ended December 31, 2024 from $258,406 for the three months ended December 31, 2023. The decrease is primarily due additional discounts for our products that we offered to certain large customers.
Current wording
Revenue. We generate revenue from sales of our cleaning products. Our revenue increased by $243,995, or 77.73%, to $557,915 for the three months ended March 31, 2025 from $313,920 for the three months ended March 31, 2024. The increase is primarily due to an increase of sales to our distributor in India.
Previous wording
Cost of sales. Our cost of sales consists of raw materials, components and labor. Our cost of sales increased by $63,521, or 48.22%, to $195,258 for the three months ended December 31, 2024 from $131,737 for the three months ended December 31, 2023. As a percentage of revenue, cost of sales increased from 50.98% for the three months ended December 31, 2023 to 75.90% for the three months ended December 31, 2024. This increase was primarily due to an increase in sales and increase in demo expenses due to a change in sales strategy of providing customers considering large orders demonstration equipment at no cost. Additionally, a business decision was made to sell $46,000 of inventory at cost to a former customer placing their first purchase order in over 9 months.
Current wording
Cost of sales. Our cost of sales consists of raw materials, components and labor. Our cost of sales increased by $73,599, or 42.50%, to $246,783 for the three months ended March 31, 2025 from $173,184 for the three months ended March 31, 2024. As a percentage of revenue, cost of sales decreased from 55.17% for the three months ended March 31, 2024 to 44.23% for the three months ended March 31, 2025. This decrease as a percentage of revenue was primarily due to the sale of higher margin units.
Previous wording
Gross profit. As a result of the foregoing, our gross profit decreased by $64,658, or 51.04%, to $62,011 for the three months ended December 31, 2024 from $126,669 for the three months ended December 31, 2023. As a percentage of revenue, gross profit decreased from 49.02% for the three months ended December 31, 2023 to 24.10% for the three months ended December 31, 2024.
Current wording
Gross profit. As a result of the foregoing, our gross profit increased by $170,396, or 121.07%, to $311,132 for the three months ended March 31, 2025 from $140,736 for the three months ended March 31, 2024. As a percentage of revenue, gross profit increased from 44.83% for the three months ended March 31, 2024 to 55.77% for the three months ended March 31, 2025.
Previous wording
General and administrative expenses.* *Our general and administrative expenses consist primarily of personnel expenses, including employee salaries and bonuses plus related payroll taxes, stock based compensation expense, professional advisor fees, bad debts, rent expense, insurance and other expenses incurred in connection with general operations. Our general and administrative expenses increased by $590,851, or 184.46%, to $911,173 for the three months ended December 31, 2024 from $320,322 for the three months ended December 31, 2023. As a percentage of revenue, our general and administrative expenses increased from 123.96% for the three months ended December 31, 2023 to 354.17% for the three months ended December 31, 2024. This increase was primarily due to $149,403 stock compensation expense, $111,098 of additional wage and benefit expense related to the addition of three employees, $224,135 of additional professional fees such as accounting and legal, and a $69,101 increase in director and officer insurance.
Current wording
General and administrative expenses.* *Our general and administrative expenses consist primarily of personnel expenses, including employee salaries and bonuses plus related payroll taxes, stock based compensation expense, professional advisor fees, bad debts, rent expense, insurance and other expenses incurred in connection with general operations. Our general and administrative expenses increased by $447,365, or 85.88%, to $968,264 for the three months ended March 31, 2025 from $520,899 for the three months ended March 31, 2024. As a percentage of revenue, our general and administrative expenses increased from 165.93% for the three months ended March 31, 2024 to 173.55% for the three months ended March 31, 2025. This increase was primarily due to a $185,956 increase in stock compensation expense, $54,197 of additional wage and benefit expense related to the addition of 4 employees, $46,249 of additional professional fees such as accounting and legal, and a $66,161 increase in director and officer insurance. This increase in professional fees and director and office insurance is related to our listing on NYSE American in the 2025 period.
Previous wording
Advertising expenses.* *Our advertising expenses consist of vendor trade shows and various trade publications. Our advertising expenses increased by $50,274, or 204.11%, to $74,905 for the three months ended December 31, 2024 from $24,631 for the three months ended December 31, 2023. As a percentage of revenue, our advertising expenses increased from 9.53% for the three months ended December 31, 2023 to 29.12% for the three months ended December 31, 2024. Such an increase was primarily due to a significant increase in our public relations activities.
Current wording
Advertising expenses.* *Our advertising expenses consist of vendor trade shows and various trade publications. Our advertising expenses increased by $2,006, or 11.31%, to $19,743 for the three months ended March 31, 2025 from $17,737 for the three months ended March 31, 2024. As a percentage of revenue, our advertising expenses decreased from 5.65% for the three months ended March 31, 2024 to 3.54% for the three months ended March 31, 2025. The increase in advertising expenses was primarily due to an increase in product marketing materials.
Previous wording
Depreciation and amortization expense.* *We incurred depreciation and amortization expense of $39,928, or 15.52% of revenue, for the three months ended December 31, 2024, as compared to $38,646, or 14.96% of revenue, for the three months ended December 31, 2023.
Current wording
Depreciation and amortization expense.* *We incurred depreciation and amortization expense of $39,928, or 7.16% of revenue, for the three months ended March 31, 2025, as compared to $38,677, or 12.32% of revenue, for the three months ended March 31, 2024.
Previous wording
Interest expense, net.* *We incurred interest expense, net, of $80,369, or 12.92% of revenue, for the six months ended December 31, 2024, as compared to $149,012, or 25.51% of revenue, for the six months ended December 31, 2023. The decrease is primarily due to interest expense for the 2024 period being offset by interest income of $24,409 from an interest-bearing money market account opened in the fourth quarter of fiscal 2024.
Current wording
Interest expense, net. We incurred interest expense, net, of $92,551, or 16.59% of revenue, for the three months ended March 31, 2025, as compared to $84,093, or 26.79% of revenue, for the three months ended March 31, 2024. The increase is primarily due to an increase in the note payable balance.
Previous wording
Net loss.* *As a result of the cumulative effect of the factors described above, we had a net loss of $1,005,030 for the three months ended December 31, 2024, as compared to $344,799 for the three months ended December 31, 2023, an increase in loss of $660,231, or 191.48%.
Current wording
Net loss.* *As a result of the cumulative effect of the factors described above, we had a net loss of $809,354 for the three months ended March 31, 2025, as compared to $520,670 for the three months ended March 31, 2024, an increased loss of $288,684, or 55.44%.
Previous wording
The following table sets forth key components of our results of operations for the six months ended December 31, 2024 and 2023, both in dollars and as a percentage of our revenue.
Current wording
The following table sets forth key components of our results of operations for the nine months ended March 31, 2025 and 2024, both in dollars and as a percentage of our revenue.
Previous wording
Revenue. Our revenue increased by $38,078, or 6.52%, to $622,168 for the six months ended December 31, 2024 from $584,090 for the six months ended December 31, 2023. The increase is primarily due to an increase in sales with our largest customer, representing an 80% increase for the comparable six month period.
Current wording
Revenue. Our revenue increased by $282,073, or 31.41%, to $1,180,083 for the nine months ended March 31, 2025 from $898,010 for the nine months ended March 31, 2024. The increase is primarily due to an increase in sales with our largest customer, representing an 171% increase over the prior period.
Previous wording
Cost of sales. Our cost of sales increased by $90,345, or 31.78%, to $374,657 for the six months ended December 31, 2024 from $284,312 for the six months ended December 31, 2023. As a percentage of revenue, cost of sales increased from 48.68% for the six months ended December 31, 2023 to 60.22% for the six months ended December 31, 2024. This increase was primarily due to an increase in sales and increase in demo expenses due to a change in sales strategy of providing customers considering large orders demonstration equipment at no cost. Additionally, a business decision was made to sell $46,000 of inventory at cost to a former customer placing their first purchase order in over 9 months.
Current wording
Cost of sales. Our cost of sales increased by $163,946, or 35.84%, to $621,441 for the nine months ended March 31, 2025 from $457,495 for the nine months ended March 31, 2024. As a percentage of revenue, cost of sales increased from 50.95% for the nine months ended March 31, 2024 to 52.66% for the nine months ended March 31, 2025. This increase was due to an increase in sales and increase in demo expenses due to a change in sales strategy of providing customers considering large orders demonstration equipment at no cost. Additionally, a business decision was made to sell $46,000 of inventory at cost to a former customer placing their first purchase order in over 9 months.
Previous wording
Gross profit. As a result of the foregoing, our gross profit decreased by $52,267, or 17.44%, to $247,511 for the six months ended December 31, 2024 from $299,778 for the six months ended December 31, 2023. As a percentage of revenue, gross profit decreased from 51.32% for the six months ended December 31, 2023 to 39.78% for the six months ended December 31, 2024.
Current wording
Gross profit. As a result of the foregoing, our gross profit decreased by $118,127, or 26.82%, to $558,642 for the nine months ended March 31, 2025 from $440,515 for the nine months ended March 31, 2024. As a percentage of revenue, gross profit decreased from 49.05% for the nine months ended March 31, 2024 to 47.34% for the nine months ended March 31, 2025.
Previous wording
General and administrative expenses.* *Our general and administrative expenses increased by $997,191, or 120.12%, to $1,827,387 for the six months ended December 31, 2024 from $830,196 for the six months ended December 31, 2023. As a percentage of revenue, our general and administrative expenses increased from 142.13% for the six months ended December 31, 2023 to 293.71% for the six months ended December 31, 2024. This increase was primarily due to $223,833 stock compensation expense, a $470,804 increase in professional and consulting fees, and a $138,304 increase in director and officer insurance.
Current wording
General and administrative expenses.* *Our general and administrative expenses increased by $1,512,901, or 111.98%, to $2,863,998 for the nine months ended March 31, 2025 from $1,351,097 for the nine months ended March 31, 2024. As a percentage of revenue, our general and administrative expenses increased from 150.45% for the nine months ended March 31, 2024 to 242.69% for the nine months ended March 31, 2025. This increase was primarily due to $409,786 stock compensation expense, an increase of $108,479 in payroll and benefits related to an increase in headcount, a $547,553 increase in professional and consulting fees, and a $204,465 increase in director and officer insurance. The increase in professional fees and director and officer insurance is directly related to our listing on NYSE American in the 2025 period.
Previous wording
Advertising expenses.* *Our advertising expenses increased by $95,659, or 375.80%, to $121,114 for the six months ended December 31, 2024 from $25,455 for the six months ended December 31, 2023. As a percentage of revenue, our advertising expenses increased from 4.36% for the six months ended December 31, 2023 to 19.47% for the six months ended December 31, 2024. Such an increase was primarily due to a significant increase in our public relations activities.
Current wording
Advertising expenses.* *Our advertising expenses increased by $29,324, or 67.89%, to $72,515 for the nine months ended March 31, 2025 from $43,191 for the nine months ended March 31, 2024. As a percentage of revenue, our advertising expenses increased from 4.81% for the nine months ended March 31, 2024 to 6.14% for the nine months ended March 31, 2025. Such an increase was primarily due to an increase in our marketing materials, including product videos and flyers.
Previous wording
Depreciation and amortization expense.* *We incurred depreciation and amortization expense of $79,750, or 12.82% of revenue, for the six months ended December 31, 2024, as compared to $77,208, or 13.22% of revenue, for the six months ended December 31, 2023.
Current wording
Depreciation and amortization expense.* *We incurred depreciation and amortization expense of $119,678, or 10.14% of revenue, for the nine months ended March 31, 2025, as compared to $115,885, or 12.90% of revenue, for the nine months ended March 31, 2024.
Previous wording
Interest expense, net.* *We incurred interest expense, net, of $41,035, or 15.95% of revenue, for the three months ended December 31, 2024, as compared to $87,869, or 34.00% of revenue, for the three months ended December 31, 2023. The decrease is primarily due to interest expense for the 2024 period being offset by interest income of $7,256 from an interest-bearing money market account opened in the fourth quarter of fiscal 2024.
Current wording
Interest expense, net.* *We incurred interest expense, net, of $172,920, or 14.65% of revenue, for the nine months ended March 31, 2025, as compared to $233,105, or 25.96% of revenue, for the nine months ended March 31, 2024. The decrease is primarily due to interest expense for the 2024 period being offset by interest income of $29,921 from an interest-bearing money market account opened in May 2024.
Previous wording
Net loss.* *As a result of the cumulative effect of the factors described above, we had a net loss of $1,861,109 for the six months ended December 31, 2024, as compared to $782,093 for the six months ended December 31, 2023, an increase in loss of $1,079,016, or 137.97%.
Current wording
Net loss.* *As a result of the cumulative effect of the factors described above, we had a net loss of $2,670,469 for the nine months ended March 31, 2025, as compared to $1,302,763 for the nine months ended March 31, 2024, a loss increase of $1,367,706, or 104.99%.
Previous wording
Our company has incurred losses and negative cash flows from operations. From October 17, 2022 (the date of the acquisition) through December 31, 2024, we have financed our operations primarily through private investor funding and an initial public offering. As of December 31, 2024, we had cash and cash equivalents of $560,489, a net loss for the six months ended December 31, 2024 of $1,861,109 and cash used in operating activities of $1,662,330.
Current wording
Our company has incurred losses and negative cash flows from operations. From October 17, 2022 (the date of the acquisition) through March 31, 2025, we have financed our operations primarily through private investor funding and an initial public offering. As of March 31, 2025, we had cash and cash equivalents of $796,843, a net loss for the nine months ended March 31, 2025 of $2,670,469 and cash used in operating activities of $2,234,206.
Previous wording
The following table provides detailed information about our net cash flow for the nine months ended December 31, 2024.
Current wording
The following table provides detailed information about our net cash flow for the nine months ended March 31, 2025 and 2024.
Previous wording
Net cash used in operating activities was $1,662,330 for the six months ended December 31, 2024, as compared to $234,156 for the six months ended December 31, 2023. For the six months ended December 31, 2024, our net loss of $1,861,109, offset by stock-based compensation of $331,802, were the primary drivers of net cash used in operating activities. For the six months ended December 31, 2023, our net loss of $782,093, offset by a non-cash interest expense of $141,211 and stock-based compensation of $107,972, were the primary drivers of net cash used in operating activities.
Current wording
Net cash used in operating activities was $2,234,206 for the nine months ended March 31, 2025, as compared to $485,530 for the nine months ended March 31, 2024. For the nine months ended March 31, 2025, our net loss of $2,670,469 and increase in accounts receivable of $191,509 and prepaid expenses of $150,982, offset by non-cash stock-based compensation of $561,767, depreciation and amortization of $119,678 and non-cash interest expense of $195,380, were the primary drivers of net cash used in operating activities. For the nine months ended March 31, 2024, our net loss of $1,302,763 and an increase in inventory of $103,569, offset by an increase in accounts payable and accrued liabilities of $386,279, a non-cash interest expense of $223,783, stock-based compensation of $151,981, and depreciation and amortization of $115,885, were the primary drivers of net cash used in operating activities.
Previous wording
Net cash used in investing activities was $9,065 for the six months ended December 31, 2024, as compared to $1,015 for the nine months ended December 31, 2023. The net cash used in investing activities for both periods consisted entirely of purchases of property and equipment.
Current wording
Net cash used in investing activities was $18,857 for the nine months ended March 31, 2025, as compared to $2,138 for the nine months ended March 31, 2024. The net cash used in investing activities for both periods consisted entirely of purchases of property and equipment.
Previous wording
Net cash provided by financing activities was 215,273 for the six months ended December 31, 2024, as compared to net cash used in financing activities of $113,318 for the six months ended December 31, 2023. Net cash provided by financing activities for the six months ended December 31, 2024 consisted of proceeds from an advance on subscription of $300,000 and proceeds from the issuance of related party notes of $232,193, offset by payments of notes payable of $316,920, , while net cash used in financing activities for the six months ended December 31, 2023 consisted of payments for deferred offering costs of $124,824, offset by proceeds from the issuance of loans from related parties of $11,506.
Current wording
Net cash provided by financing activities was $1,015,273 for the nine months ended March 31, 2025, as compared to $150,556 for the nine months ended March 31, 2024. Net cash provided by financing activities for the nine months ended March 31, 2025 consisted of proceeds from an advance on subscription of $1,000,000 and proceeds from the issuance of related party notes of $332,193, offset by payments of notes payable of $316,920, while net cash provided by financing activities for the nine months ended March 31, 2024 consisted of proceeds from the issuance of convertible notes of $225,000 and proceeds from related party loans of $50,014, offset by payments for deferred offering costs of $124,458.
Previous wording
Please see Notes 10 and 11 to our unaudited condensed financial statements above for a description of the terms of our outstanding debt.
Current wording
Please see Notes 10 and 11 to our unaudited condensed consolidated financial statements above for a description of the terms of our outstanding debt.
Previous wording
Our principal commitments consist mostly of obligations under the loans described in Notes 10 and 11 to our unaudited condensed financial statements above. We also have a non-cancellable operating lease commitment for our office facility expiring in 2028 as described in Note 14 to the unaudited condensed financial statements above. Other than the foregoing, at December 31, 2024, we did not have other long-term debt obligations, capital (finance) lease obligations, operating lease obligations, purchase obligations or other long-term liabilities reflected on our statements of financial position.
Current wording
Our principal commitments consist mostly of obligations under the loans described in Notes 10 and 11 to our unaudited condensed consolidated financial statements above. We also have a non-cancellable operating lease commitment for our office facility expiring in 2028 as described in Note 14 to the unaudited condensed consolidated financial statements above. Other than the foregoing, at March 31, 2025, we did not have other long-term debt obligations, capital (finance) lease obligations, operating lease obligations, purchase obligations or other long-term liabilities reflected on our statements of financial position.
Previous wording
The preparation of our unaudited condensed financial statements requires our management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On a regular basis, we evaluate these estimates. These estimates are based on management’s historical industry experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may differ from these estimates.
Current wording
The preparation of our unaudited condensed consolidated financial statements requires our management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On a regular basis, we evaluate these estimates. These estimates are based on management’s historical industry experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may differ from these estimates.