Sonasoft Corp Sells Cornerstone to Focus on AI

Rhea-AI Summary

Sonasoft Corp (OTCQB: SSFT) has announced the sale of its wholly-owned subsidiary, Cornerstone Tech Inc., for cash consideration of approximately $730,000. This transaction marks a key step in Sonasoft's transformation into an all-AI company, a goal initiated with Cornerstone's acquisition in 2019. Additionally, the company has raised $1.5M from the sale of restricted common stock and $1M from preferred stock, eliminating over $10M in liabilities, thus entering Q4 with a significantly strengthened balance sheet. The AI and engineering teams will concentrate on enhancing the SAIBRE AI ecosystem.

Positive

• Sale of Cornerstone Tech Inc. for $730,000 supports pivot to AI-focused business model.
• Successfully raised $1.5M from restricted common stock and $1M from preferred stock.
• Eliminated over $10M in liabilities, strengthening the balance sheet.

Negative

• None.

SAN JOSE, CA, Oct. 13, 2022 (GLOBE NEWSWIRE) -- via NewMediaWire – Today, Sonasoft Corp (OTCQB: SSFT) (“Sonasoft”) announces the sale of Cornerstone Tech Inc. (“Cornerstone”), its wholly-owned subsidiary, for aggregate cash consideration of approximately $730,000. This all-cash transaction is the final stage in Sonasoft’s pivot to an all-AI company. Cornerstone was acquired by Sonasoft in 2019 as a transitional step towards this goal.  

“In addition to this sale, Sonasoft has also been successful on the capital raising front,” said Robert Baumert, CFO of Sonasoft. “Specifically, we recently closed funding on the sale of $1.5M of restricted common stock at a per share price of $0.05, as well as a $1M round of preferred stock at a per share price of $7.50. This is in addition to the $999,999 raised through the sale of preferred stock in Q1 and Q2 at a price of $5 per share. We have also continued eliminating debts, converting all convertible debt instruments into preferred stock as of the end of the third quarter. Since the beginning of 2022, we have successfully eliminated more than $10M in current and long-term liabilities. As a result of all these activities, Sonasoft enters Q4 with a significantly strengthened balance sheet.”  

“The sale of Cornerstone allows us to double down on delivering AI solutions for our core markets,” said Mike Khanna, CEO of Sonasoft. “The AI and engineering teams have been working hard to refine our SAIBRE AI ecosystem to ensure it is the best-in-class platform for our customers. Following the Cornerstone sale, my executive team can put all our efforts into supporting these core activities.”  

Dr. Caroline Zaborowski, newly promoted to CTO, says “My whole team is now free to focus on delivering the best possible AI solutions for our customers. Currently, our primary targets are the health and entertainment sectors. These are hugely significant sectors where AI can make a truly transformative impact. Knowing that the whole company is now free to concentrate on the core AI business makes my life a lot easier.”

About Sonasoft Corp. (OTCQB: SSFT) 

Sonasoft was founded in Silicon Valley in 2003. For more information about the company, please visit: https://www.sonasoft.com 

Sonasoft specializes in building end-to-end AI applications supported by the SAIBRE AI ecosystem. 

For investor-specific information, please visit: https://www.sonasoft.com/investors/

Investor Relations Contact 
Josh Rose, Chief of Staff, Sonasoft Corporation.  
Phone: (408) 708-4000 
jrose@sonasoft.com  

Forward-looking Statements 

This release contains statements that constitute forward-looking statements. These statements appear in a number of places in this release and include all statements that are not statements of historical fact regarding the intent, belief or current expectations of the Company, its directors or its officers with respect to, among other things: (i) the Company’s financing plans; (ii) trends affecting the Company’s financial condition or results of operations; (iii) the Company’s growth strategy and operating strategy; and (iv) the declaration and payment of dividends. The words “may,” “would,” “will,” “expect,” “estimate,” “anticipate,” “believe,” “intend,” and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the Company’s ability to control and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors. 

FAQ

What was the cash amount Sonasoft received from the sale of Cornerstone Tech Inc.?

Sonasoft received approximately $730,000 from the sale of Cornerstone Tech Inc.

How much capital has Sonasoft raised recently?

Sonasoft has raised a total of $2.5M in recent funding from the sale of common and preferred stock.

What was the focus of Sonasoft's business transformation?

Sonasoft is focusing on becoming an all-AI company and enhancing its SAIBRE AI ecosystem.

What was the purpose of selling Cornerstone Tech Inc.?

The sale allows Sonasoft to concentrate on delivering AI solutions for its core markets.

How much debt has Sonasoft eliminated in 2022?

Since the beginning of 2022, Sonasoft has successfully eliminated more than $10M in current and long-term liabilities.