CleanCore Solutions, Inc. (NYSE American:ZONE), a specialty cleaning and sanitation products company with a market capitalization of $10.55 million, has entered into a series of financial agreements involving the restructuring of a previous debt and the issuance of new promissory notes. The transactions were detailed in a recent filing with the Securities and Exchange Commission. According to InvestingPro analysis, the company operates with moderate debt levels while maintaining liquid assets that exceed short-term obligations, with a current ratio of 1.62.
On Monday, December 24, 2024, CleanCore Solutions disclosed the cancellation of a promissory note, originally worth $633,840, issued to Walker Water, LLC. The note was divided and reassigned to two individuals: Garry Hollst, the company's Chief Revenue Officer, and Gary Rohwer, an external party. Following the reassignment, the company issued two separate notes: the "Hollst Note" for $316,920, and the "Rohwer Note" for $332,633.95, the latter including accrued interest since May 31, 2024.
The Hollst Note, maturing on May 31, 2025, carries no interest unless an event of default occurs, after which the interest rate would rise to 10% per annum. Similarly, the Rohwer Note, due on December 31, 2024, follows the same interest conditions. Both notes are unsecured and can be prepaid without penalty.
In addition to these agreements, CleanCore Solutions also issued an original issue discount promissory note to Clayton Adams, the company's CEO, for $415,241.25 on December 24, 2024. This "OID Note," maturing on June 30, 2025, accrues interest at an annual rate of 8%, increasing to 15% upon default. Like the other notes, it is unsecured and can be prepaid at any time without additional costs.
The filing indicates that these financial maneuvers are intended to manage the company's existing obligations and align them with the interests of key executives. It demonstrates a strategic approach to handling corporate debt by involving high-level insiders in the company's financial restructuring efforts. InvestingPro data reveals the company has been quickly burning through cash, with revenue of $1.64 million in the last twelve months. Subscribers to InvestingPro can access 10 additional key insights about ZONE's financial health and future prospects.
This report is based on information provided by CleanCore Solutions, Inc. in a press release statement filed with the SEC.
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