CleanCore Solutions, Inc. 10-K

ITEM 9A. CONTROLS AND PROCEDURES. Evaluation of Disclosure Controls and Procedures We maintain “disclosure controls and procedures,” as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, that are designed to ensure information required to be disclosed in our reports that we file or furnish pursuant to the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to our management, including our Chief Executive Officer (our principal executive officer) and Chief Financial Officer (our principal financial officer), as appropriate to allow for timely decisions regarding required disclosure. Our management, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of our disclosure controls and procedures as of June 30, 2025. Based on such evaluation, our principal executive officer and principal financial officer have concluded that, as of such date, our disclosure controls and procedures were not effective at a reasonable assurance level due to the material weaknesses in internal control over financial reporting described below. Management’s Annual Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting for our company. Internal control over financial reporting refers to the process designed by, or under the supervision of, our principal executive officer and principal financial and accounting officer, and effected by our board of directors, management, and other personnel, to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of financial statements for external purposes in accordance with GAAP, and includes those policies and procedures that: (1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that our receipts and expenditures are being made only in accordance with the authorization of our management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements. 32 Our management evaluated the effectiveness of our internal control over financial reporting as of June 30, 2025. In making this evaluation, management used the framework established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission, or COSO. The COSO framework summarizes each of the components of a company’s internal control system, including (i) the control environment, (ii) risk assessment, (iii) control activities, (iv) information and communication, and (v) monitoring. Based on our evaluation, we determined that, as of June 30, 2025, our internal control over financial reporting was not effective due to the following material weaknesses: ● We lack a sufficient number of trained professionals with the expertise to design, implement, and execute a formal risk assessment process and formal accounting policies, procedures, and controls over accounting and financial reporting to ensure the timely and accurate recording of financial transactions while maintaining a segregation of duties. ● We lack a sufficient number of trained professionals with the appropriate GAAP technical expertise to identify, evaluate, and account for complex transactions and review valuation reports prepared by external specialists. We are planning on implementing measures designed to improve our internal control over financial reporting to remediate these material weaknesses, including formalizing our processes and internal control documentation and strengthening supervisory reviews by our financial management and hiring additional qualified accounting and finance personnel and engaging financial consultants to enable the implementation of internal control over financial reporting and segregating duties amongst accounting and finance personnel. While we are implementing these measures, we cannot assure you that these efforts will remediate our material weaknesses and significant deficiencies in a timely manner, or at all, or prevent restatements of our financial statements in the future. If we are unable to successfully remediate our material weaknesses, or identify any future significant deficiencies or material weaknesses, the accuracy and timing of our financial reporting may be adversely affected, we may be unable to maintain compliance with securities law requirements regarding timely filing of periodic reports, and the market price of our class B common stock may decline as a result. Our management, including our principal executive officer and principal financial officer, do not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. Our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Due to inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected. As a smaller reporting company, we are not required to include an attestation report on internal control over financial reporting issued by our independent registered public accounting firm in this report. Changes in Internal Controls over Financial Reporting We regularly review our system of internal control over financial reporting and make changes to our processes and systems to improve controls and increase efficiency, while ensuring that we maintain an effective internal control environment. Changes may include such activities as implementing new, more efficient systems, consolidating activities, and migrating processes. Except for the matters described above, there have been no changes in our internal control over financial reporting during the fourth quarter of fiscal year 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ITEM 9B. OTHER INFORMATION. We have no information to disclose that was required to be in a report on Form 8-K during the fourth quarter of fiscal year 2025 but was not reported. None of our directors or executive officers adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K) during the fourth quarter of fiscal year 2025. ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS. Not applicable. 33 PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE. The information required by this Item will be included in our definitive proxy statement to be filed with the SEC within 120 days after June 30, 2025 in connection with the solicitation of proxies for our 2025 annual meeting of stockholders, or the 2025 Proxy Statement, and is incorporated herein by reference. ITEM 11. EXECUTIVE COMPENSATION. The information required by this Item will be included in the 2025 Proxy Statement and is incorporated herein by reference. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS. The information required by this Item will be included in the 2025 Proxy Statement and is incorporated herein by reference. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE. The information required by this Item will be included in the 2025 Proxy Statement and is incorporated herein by reference. ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES. The information required by this Item will be included in the 2025 Proxy Statement and is incorporated herein by reference. 34 PART IV ITEM 15. EXHIBIT AND FINANCIAL STATEMENT SCHEDULES. (a) List of Documents Filed as a Part of This Report: (1) Index to Financial Statements: Report of Independent Registered Public Accounting Firm (PCAOB ID 05854) F-2 Consolidated Balance Sheets as of June 30, 2025 and 2024 F-3 Consolidated Statements of Operations for the Years Ended June 30, 2025 and 2024 F-4 Consolidated Statements of Stockholders’ Equity for the Years Ended June 30, 2025 and 2024 F-5 Consolidated Statements of Cash Flows for the Years Ended June 30, 2025 and 2024 F-6 Notes to Consolidated Financial Statements F-7 (2) Index to Financial Statement Schedules: All schedules have been omitted because the required information is included in the consolidated financial statements or the notes thereto, or because it is not required. (3) Index to Exhibits: See exhibits listed under Part (b) below. 35 (b) Exhibits: Exhibit No. Description 3.1 Articles of Incorporation of CleanCore Solutions, Inc., as amended (incorporated by reference to Exhibit 3.1 to the Registration Statement on Form S-1 filed on October 10, 2023) 3.2 Bylaws of CleanCore Solutions, Inc. (incorporated by reference to Exhibit 3.2 to the Registration Statement on Form S-1 filed on October 10, 2023) 4.1* Description of Securities of CleanCore Solutions, Inc. 4.2 Common Stock Purchase Warrant issued by CleanCore Solutions, Inc. to Boustead Securities, LLC on June 9, 2025 (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed on June 11, 2025) 4.3 Common Stock Purchase Warrant issued by CleanCore Solutions, Inc. to Boustead Securities, LLC on June 9, 2025 (incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K filed on June 11, 2025) 4.4 Form of Common Stock Purchase Warrant issued by CleanCore Solutions, Inc. on April 16, 2025 (incorporated by reference to Exhibit 4.2 to the Current Report on Form 8-K filed on April 21, 2025) 4.5 Common Stock Purchase Warrant issued by CleanCore Solutions, Inc. to Sanzonate Global Inc. on April 15, 2025 (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed on April 21, 2025) 4.6* Common Stock Purchase Warrant issued by CleanCore Solutions, Inc. to MARS Capital Technologies LLC on July 11, 2024 4.7* Common Stock Purchase Warrant issued by CleanCore Solutions, Inc. to MARS Capital Technologies LLC on July 11, 2024 4.8* Common Stock Purchase Warrant issued by CleanCore Solutions, Inc. to MARS Capital Technologies LLC on July 11, 2024 4.9* Common Stock Purchase Warrant issued by CleanCore Solutions, Inc. to MARS Capital Technologies LLC on July 11, 2024 4.10 Common Stock Purchase Warrant issued by CleanCore Solutions, Inc. to Boustead Securities, LLC on April 30, 2024 (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8-K filed on May 1, 2024) 10.1 Sales Agreement, dated as of June 20, 2025, between CleanCore Solutions, Inc. and Curvature Securities LLC (incorporated by reference to Exhibit 1.1 to the Current Report on Form 8-K filed on June 20, 2025) 10.2 Asset Purchase Agreement, dated February 21, 2025, among CleanCore Global Limited, Sanzonate Europe Inc. and Sanzonate Global Inc. (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on February 26, 2025) 10.3 Amendment No. 1 to Asset Purchase Agreement, dated April 15, 2025, among CleanCore Global Limited, Sanzonate Europe Ltd. and Sanzonate Global Inc. (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on April 21, 2025) 10.4 10% Subordinated Promissory Note issued by CleanCore Global Limited to Sanzonate Europe Ltd. on April 15, 2025 (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K filed on April 21, 2025) 10.5* Memorandum of Understanding, dated January 10, 2025, between CleanCore Solutions, Inc. and Kellermeyer Bergensons Services, LLC 10.6 Product Development Proposal, dated August 20, 2024, between CleanCore Solutions, Inc. and Business International Incorporation (incorporated by reference to Exhibit 10.2 to the Annual Report on Form 10-K filed on September 20, 2024) 10.7 Agreement, dated July 27, 2023, between Nebraska C. Ozone, LLC and CleanCore Solutions, Inc. (incorporated by reference to Exhibit 10.16 to the Registration Statement on Form S-1 filed on October 10, 2023) 10.8* Original Issue Discount Promissory Note issued by CleanCore Solutions, Inc. to Larry Little on June 30, 2025 10.9* 12% Unsecured Promissory Note issued by CleanCore Solutions, Inc. to John H. Nelson on June 6, 2025 10.10 Form of 12% Unsecured Promissory Note issued by CleanCore Solutions, Inc. on April 16, 2025 (incorporated by reference to Exhibit 10.5 to the Current Report on Form 8-K filed on April 21, 2025) 36 10.11 Promissory Note issued by CleanCore Solutions, Inc. to Garry Hollst on December 24, 2024 (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K filed on December 31, 2024) 10.12 Amended and Restated Promissory Note issued by CleanCore Solutions, Inc. to Garry Hollst on May 2, 2025 (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on May 7, 2025) 10.13 20% Original Issue Discount Promissory Note issued by CleanCore Solutions, Inc. to Clayton Adams on December 24, 2024 (incorporated by reference to Exhibit 10.5 to the Current Report on Form 8-K filed on December 31, 2024) 10.14 Note Sale Assignment and Cancellation Agreement, dated January 27, 2025, among Clayton Adams, Travis Buchanan and CleanCore Solutions, Inc. (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on January 31, 2025) 10.15 20% Original Issue Discount Promissory Note issued by CleanCore Solutions, Inc. to Clayton Adams on January 27, 2025 (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K filed on January 31, 2025) 10.16 Note Amendment Agreement, dated May 2, 2025, between CleanCore Solutions, Inc. and Clayton Adams (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K filed on May 7, 2025) 10.17 20% Original Issue Discount Promissory Note issued by CleanCore Solutions, Inc. to Travis Buchanan on January 27, 2025 (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K filed on January 31, 2025) 10.18 Note Amendment Agreement, dated May 2, 2025, between CleanCore Solutions, Inc. and Travis Buchanan (incorporated by reference to Exhibit 10.6 to the Current Report on Form 8-K filed on May 7, 2025) 10.19 Promissory Note issued by CleanCore Solutions, Inc. to Garry Rohwer on December 24, 2024 (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K filed on December 31, 2024) 10.20 Amended and Restated Promissory Note issued by CleanCore Solutions, Inc. to Burlington Capital, LLC on May 31, 2024 (incorporated by reference to Exhibit 10.4 to the Current Report on Form 8-K filed on June 6, 2024) 10.21 Loan Agreement, dated March 26, 2024, between CleanCore Solutions, Inc. and Clayton Adams (incorporated by reference to Exhibit 10.14 to Amendment No. 6 to the Registration Statement on Form S-1/A filed on March 27, 2024) 10.22 Revolving Credit Note issued by CleanCore Solutions, Inc. to Clayton Adams on March 26, 2024 (incorporated by reference to Exhibit 10.15 to Amendment No. 6 to the Registration Statement on Form S-1/A filed on March 27, 2024) 10.23 Settlement and Release Agreement, dated June 6, 2025, among Matthew Atkinson, CleanCore Solutions, Inc., Clayton Adams and David Enholm (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on June 11, 2025) 10.24* Settlement Agreement, dated June 5, 2025, between Boustead Securities, LLC and CleanCore Solutions, Inc. 10.25 Business Property Lease, dated November 9, 2022, between RMR Mercury I-80, LLC and CleanCore Solutions, Inc. (incorporated by reference to Exhibit 10.13 to the Registration Statement on Form S-1 filed on October 10, 2023) 10.26 Business Property Lease Amendment, dated October 3, 2023, between RMR Mercury I-80, LLC and CleanCore Solutions, Inc. (incorporated by reference to Exhibit 10.13 to the Registration Statement on Form S-1 filed on October 10, 2023) 10.27 Business Property Lease Second Amendment, dated March 20, 2024, between RMR Mercury I-80, LLC and CleanCore Solutions, Inc. (incorporated by reference to Exhibit 10.18 to Amendment No. 6 to the Registration Statement on Form S-1/A filed on March 27, 2024) 10.28† Consulting Agreement, dated April 1, 2024, between CleanCore Solutions, Inc. and Birddog Capital, LLC (incorporated by reference to Exhibit 10.20 to the Annual Report on Form 10-K filed on September 20, 2024) 10.29† Amendment No. 1 to Consulting Agreement, dated June 11, 2025, between CleanCore Solutions, Inc. and Birddog Capital, LLC (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on June 17, 2025) 10.30† Employment Agreement, dated March 27, 2023, between CleanCore Solutions, Inc. and David Enholm (incorporated by reference to Exhibit 10.18 to the Registration Statement on Form S-1 filed on October 10, 2023) 37 10.31† Amendment No. 1 to Executive Employment Agreement, dated May 1, 2025, between CleanCore Solutions, Inc. and David Enholm (incorporated by reference to Exhibit 10.8 to the Current Report on Form 8-K filed on May 7, 2025) 10.32† Employment Agreement, dated January 1, 2025, between CleanCore Solutions, Inc. and Travis Buchanan (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on January 7, 2025) 10.33† Employment Agreement, dated January 1, 2025, between CleanCore Solutions, Inc. and Gary Hollst (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on January 7, 2025) 10.34 Form of Independent Director Agreement between CleanCore Solutions, Inc. and each independent director and each director nominee (incorporated by reference to Exhibit 10.24 to the Registration Statement on Form S-1 filed on October 10, 2023) 10.35 Form of Indemnification Agreement between CleanCore Solutions, Inc. and each independent director and each director nominee (incorporated by reference to Exhibit 10.25 to the Registration Statement on Form S-1 filed on October 10, 2023) 10.36† CleanCore Solutions, Inc. 2022 Equity Incentive Plan (incorporated by reference to Exhibit 99.1 to the Registration Statement on Form S-8 filed on July 23, 2025) 10.37† Amendment No. 1 to CleanCore Solutions, Inc. 2022 Equity Incentive Plan (incorporated by reference to Exhibit 10.28 to Amendment No. 2 to the Registration Statement on Form S-1/A filed on January 9, 2024) 10.38† Amendment No. 2 to CleanCore Solutions, Inc. 2022 Equity Incentive Plan (incorporated by reference to Exhibit 99.3 to the Registration Statement on Form S-8 filed on July 23, 2025) 10.39† Form of Stock Option Agreement (incorporated by reference to Exhibit 10.27 to the Registration Statement on Form S-1 filed on October 10, 2023) 10.40† Form of Restricted Stock Award Agreement (incorporated by reference to Exhibit 10.28 to the Registration Statement on Form S-1 filed on October 10, 2023) 10.41† Form of Restricted Stock Unit Award Agreement (incorporated by reference to Exhibit 10.29 to the Registration Statement on Form S-1 filed on October 10, 2023) 14.1 Code of Business Conduct and Ethics (incorporated by reference to Exhibit 14.1 to the Annual Report on Form 10-K filed on September 20, 2024) 19.1 Insider Trading Policy (incorporated by reference to Exhibit 19.1 to the Annual Report on Form 10-K filed on September 20, 2024) 21.1* List of Subsidiaries 23.1* Consent of TAAD, LLP 31.1* Certifications of Principal Executive Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 31.2* Certifications of Principal Financial and Accounting Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 32.1** Certifications of Principal Executive Officer furnished pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 32.2** Certifications of Principal Financial and Accounting Officer furnished pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 97.1 Clawback Policy (incorporated by reference to Exhibit 97.1 to the Annual Report on Form 10-K filed on September 20, 2024) 101* Inline XBRL Document Set for the consolidated financial statements and accompanying notes included in this Annual Report on Form 10-K 104* Inline XBRL for the cover page of this Annual Report on Form 10-K, included in the Exhibit 101 Inline XBRL Document Set * Filed herewith ** Furnished herewith † Executive compensation plan or arrangement ITEM 16. FORM 10-K SUMMARY. None. 38 FINANCIAL STATEMENTS Page Report of Independent Registered Public Accounting Firm (PCAOB ID 05854 ) F-2 Consolidated Balance Sheets as of June 30, 2025 and 2024 F-3 Consolidated Statements of Operations for the Years Ended June 30, 2025 and 2024 F-4 Consolidated Statements of Stockholders’ Equity for the Years Ended June 30, 2025 and 2024 F-5 Consolidated Statements of Cash Flows for the Years Ended June 30, 2025 and 2024 F-6 Notes to Consolidated Financial Statements F-7 F- 1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders of CleanCore Solutions, Inc. and its Subsidiary Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of CleanCore Solutions, Inc. and its Subsidiary(“the Company”) as of June 30, 2025 and 2024, and the related consolidated statements of operations, comprehensive loss, stockholders’ equity, and cash flows for the two-year periods ended June 30, 2025 and 2024, and the related notes (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2025 and 2024, and the results of its operations and its cash flows for the two-year periods ended June 30, 2025 and 2024, in conformity with accounting principles generally accepted in the United States of America. Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company has an accumulated deficit and negative cash flows from operations. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ TAAD, LLP We have served as the Company’s auditor since 2022 Diamond Bar, CA August 22, 2025 F- 2 CLEANCORE SOLUTIONS, INC. CONSOLIDATED BALANCE SHEETS As of June 30, 2025 2024 Assets Current assets: Cash and cash equivalents $ 1,460,997 $ 2,016,611 Accounts receivable, net 657,683 467,286 Inventory, net 1,347,693 672,326 Deferred offering costs 124,062 - Prepaid expenses and other current assets 227,564 55,365 Total current assets 3,817,999 3,211,588 Property and equipment, net 32,548 10,572 Right of use assets 394,415 524,818 Intangibles, net 1,974,509 1,486,923 Goodwill 2,237,910 2,237,910 Other assets 9,440 9,440 Total assets $ 8,466,821 $ 7,481,251 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable and accrued expenses $ 1,380,285 $ 573,956 Deferred revenue - 10,395 Lease liability – current 145,005 131,887 Note payable – current 690,112 698,149 Note payable – related party 415,241 - Due to related parties 216,895 91,119 Total current liabilities 2,847,538 1,505,506 Lease liability – non-current 273,099 418,104 Note payable – non-current 3,880,202 1,821,184 Total liabilities 7,000,839 3,744,794 Commitments and contingencies (Note 16) Stockholders’ Equity Class A Common Stock; $ 0.0001 par value, 50,000,000 shares authorized; 1,875,795 and 270,000 shares issued and outstanding as of June 30, 2025 and 2024, respectively 188 27 Class B Common Stock; $ 0.0001 par value, 250,000,000 shares authorized; 9,961,227 and 7,960,919 shares issued and outstanding as of June 30, 2025 and 2024, respectively 996 796 Additional paid-in capital 15,490,763 11,040,583 Other comprehensive income 21,259 - Accumulated deficit ( 14,047,224 ) ( 7,304,949 ) Total stockholders’ equity 1,465,982 3,736,457 Total liabilities and stockholders’ equity $ 8,466,821 $ 7,481,251 The accompanying notes are an integral part of these consolidated financial statements. F- 3 CLEANCORE SOLUTIONS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS Years Ended June 30, 2025 2024 Revenue, net $ 2,072,834 $ 1,604,973 Cost of sales (exclusive of depreciation shown separately below) 1,086,369 809,161 Gross profit 986,465 795,812 Operating expenses: General and administrative 7,081,299 2,471,480 Advertising expense 92,598 116,007 Depreciation and amortization expense 198,909 155,059 Loss from operations ( 6,386,341 ) ( 1,946,734 ) Interest expense, net 356,054 335,008 Foreign exchange gain 120 - Net loss $ ( 6,742,275 ) $ ( 2,281,742 ) Foreign currency translation adjustment 21,259 - Total comprehensive loss $ ( 6,721,016 ) ( 2,281,742 ) Net loss per share of Class A and Class B stock, basic and diluted $ ( 0.79 ) $ ( 0.49 ) Weighted average shares used in computing net loss per Class A share, basic and diluted 228,891 350,192 Weighted average shares used in computing net loss per Class B share, basic and diluted 8,320,481 4,311,142 The accompanying notes are an integral part of these consolidated financial statements. F- 4 CLEANCORE SOLUTIONS, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) Series Seed Preferred Stock Class A Common Stock Class B Common Stock Additional Paid in Accumulated Other Comprehensive Accumulated Total Stockholders’ Shares Amount Shares Amount Shares Amount Capital Income Deficit Equity Balance at July 1, 2024 4,000,000 $ 400 660,000 $ 66 1,795,940 $ 180 $ 6,768,775 $ - $ ( 5,023,207 ) $ 1,746,214 Conversion of class A common stock into class B common stock - - ( 4,390,000 ) ( 439 ) 4,390,000 439 - - - - Conversion of series seed preferred stock into class A common stock ( 4,000,000 ) ( 400 ) 4,000,000 400 - - - - - - Issuance of class B common stock pursuant to initial public offering, net of issuance and deferred offering costs of $ 1,656,453 - - - 1,250,000 125 3,343,422 - - 3,343,547 Issuance of class B common stock pursuant to convertible notes - - - - 257,479 25 257,455 - - 257,480 Issuance of non-qualified stock options – 2022 Equity Incentive Plan - - - - - - 126,975 - - 126,975 Issuance of class B common stock upon vesting of restricted stock units – 2022 Equity Incentive Plan - - - - 92,500 9 320,017 - - 320,026 Issuance of restricted stock awards – 2022 Equity Incentive Plan - - - - 175,000 18 51,086 - - 51,104 Stock based compensation – 2022 Equity incentive plan - - - - - - 172,853 - - 172,853 Net loss for the period - - - - - - - - ( 2,281,742 ) ( 2,281,742 ) Balance at June 30, 2024 - $ - 270,000 $ 27 7,960,919 $ 796 $ 11,040,583 - $ ( 7,304,949 ) $ 3,736,457 Conversion of class A common stock into class B common stock - - ( 270,000 ) ( 27 ) 270,000 27 - - - - Issuance of class A common stock upon exercise of options - - 1,875,795 188 - - - - - 188 Issuance of class B common stock upon vesting of restricted stock units – 2022 Equity Incentive Plan - - - - 174,278 18 262,199 - - 262,217 Issuance of restricted stock awards – 2022 Equity Incentive Plan - - - - 563,172 56 1,930,406 - - 1,930,462 Issuance of Class B common stock upon exercise of warrants - - - - 331,657 33 403,138 - 403,171 Issuance of Class B common stock pursuant to convertible notes - - - - 307,701 31 344,594 - - 344,625 Issuance of Class B common stock upon settlement of debt - - - - 133,500 13 299,987 - - 300,000 Issuance of class B common stock under separation agreement - - - - 20,000 2 55,313 - - 55,315 Issuance of class B common stock under settlement agreement - - - - 200,000 20 - - - 20 Stock based compensation – 2022 Equity incentive plan - - - - - - 955,046 - - 955,046 Modification of related party debt - - - - - - 18,022 - - 18,022 Acquisition-related costs - - - - - - 181,475 - - 181,475 Currency translation adjustment - - - - - - - 21,259 - 21,259 Net loss for the period - - - - - - - - ( 6,742,275 ) ( 6,742,275 ) Balance at June 30, 2025 - $ - 1,875,795 $ 188 9,961,227 $ 996 $ 15,490,763 $ 21,259 $ ( 14,047,224 ) $ 1,465,982 The accompanying notes are an integral part of these consolidated financial statements. F- 5 CLEANCORE SOLUTIONS, INC. CONSOLIDATED STATEMENT OF CASH FLOWS Years Ended June 30, 2025 2024 Cash flows from operating activities Net loss $ ( 6,742,275 ) $ ( 2,281,742 ) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 203,777 155,059 Accretion of note payable discount 83,048 5,250 Non cash interest expense 344,886 85,593 Stock based compensation 3,203,230 670,958 Non cash lease expense ( 1,484 ) 5,308 Reversal of contingent liability ( 111,987 ) - Modification of related party debt 18,022 - Provision for bad debt and write-off on uncollectable accounts 221,241 37,498 Impairment of intangibles 261,250 - Foreign exchange (gain)/loss ( 120 ) - Changes in operating assets and liabilities: Accounts receivable ( 138,859 ) ( 271,224 ) Inventory ( 326,958 ) ( 211 ) Prepaid expenses ( 172,198 ) 80,301 Deferred revenue ( 10,395 ) 10,395 Due to related parties 216,896 - Accounts payable and accrued liabilities 614,267 ( 45,065 ) Net cash used in operating activities ( 2,337,659 ) ( 1,547,880 ) Investing activities Purchase of property and equipment ( 32,389 ) ( 10,438 ) Cash used in acquisition ( 581,792 ) - Net cash used in investing activities ( 614,181 ) ( 10,438 ) Financing activities Proceeds from issuance of class B common stock pursuant to initial public offering, net of issuance costs - 4,233,875 Proceeds from issuance of convertible notes - 225,000 Proceeds from related party loans 332,193 - Proceeds from issuance of promissory notes and warrants 1,510,000 - Proceeds from exercise of warrants 403,171 - Proceeds from issuance of original issue discount notes 500,000 - Payments for deferred offering costs ( 53,477 ) ( 587,573 ) Payments on notes payable ( 316,920 ) ( 480,667 ) Repayments of loans due to related parties - ( 208,900 ) Net cash provided by financing activities 2,374,967 3,181,735 Effect of exchange rate changes on cash and cash equivalents 21,259 - Net increase (decrease) in cash ( 555,614 ) 1,623,417 Cash and cash equivalents at beginning of year 2,016,611 393,194 Cash and cash equivalents at the end of year $ 1,460,997 $ 2,016,611 Supplementary cash flow disclosure Cash paid for interest $ 48,830 $ 436,346 Supplementary schedule of non-cash investing and financing activities Shares issued for conversion from convertible note payable $ - $ 257,480 Unpaid deferred offering costs $ 70,585 $ - Debt to equity conversion $ 644,625 $ - Issuance of debt in connection with acquisition $ 800,000 $ - Issuance of warrants in connection with acquisition $ 181,475 $ - Fair value of assets acquired $ 1,563,267 $ - The accompanying notes are an integral part of these consolidated financial statements. F- 6 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 1. Organization and Business CC Acquisition Corp. was incorporated in the State of Nevada on August 23, 2022 for the sole purpose of acquiring substantially all of the assets of CleanCore Solutions, LLC, TetraClean Systems, LLC, and Food Safety Technologies, LLC, pursuant to an asset purchase agreement entered into by CC Acquisition Corp. with these three entities and their owners on October 17, 2022. On November 21, 2022, CC Acquisition Corp. changed its name to CleanCore Solutions, Inc. (“CleanCore US”). Since CleanCore US acquired substantially all of the assets of each of CleanCore Solutions, LLC, TetraClean Systems, LLC, and Food Safety Technologies, LLC, the business of these three entities is now operated by CleanCore US. On January 29, 2025, CleanCore established CleanCore Global Limited (“CleanCore Global,” and together with CleanCore US, the “Company”) as a wholly owned subsidiary in Ireland. The Company specializes in the development and production of cleaning products that produce pure aqueous ozone products for professional, industrial, or home use. The Company has a patented nanobubble technology using aqueous ozone that it believes is highly effective in cleaning, sanitizing, and deodorizing surfaces and high-touch areas. The Company offers products and solutions that are marketed for janitorial and sanitation, ice machine cleaning, laundry, and industrial industries. Its products are used in many types of environments including retail establishments, distribution centers, factories, warehouses, restaurants, schools and universities, airports, healthcare, food service, and commercial buildings such as offices, malls, and stores. The headquarters, principal address and records of the Company are located at 5920 South 118th Circle, Suite 2, Omaha, Nebraska. Initial Public Offering On April 30, 2024, the Company closed its initial public offering of 1,250,000 shares of class B common stock at a price to the public of $ 4.00 per share for gross offering proceeds of $ 5,000,000 , before deducting underwriting discounts, commissions, and offering expenses payable by the Company. After deducting underwriting discounts, commissions and other offering costs, the Company received net proceeds of $ 3,343,547 . Liquidity The Company has incurred losses and negative cash flows from operations. From October 17, 2022 (the date of the acquisition) through June 30, 2025, the Company has financed its operations primarily through investor funding. As of June 30, 2025, the Company had cash of $ 1,460,997 . For the year ended June 30, 2025, the Company had a net loss of $ 6,742,275 and cash used in operating activities of $ 2,337,659 . In accordance with Accounting Standards Codification (“ASC”) Topic 205-40, Presentation of Financial Statements - Going Concern , management is required to perform a two-step analysis over the Company’s ability to continue as a going concern. Management must first evaluate whether there are conditions and events that raise substantial doubt about the Company’s ability to continue as a going concern for a period of 12 months from the date the consolidated financial statements are issued. If management concludes that substantial doubt is raised, management is also required to consider whether its plans alleviate that doubt. Despite the initial public offering described above, management believes that currently available resources will not be sufficient to fund the Company’s planned expenditures over the next 12 months. These factors, individually and collectively, indicate that a material uncertainty exists that raises substantial doubt about the Company’s ability to continue as a going concern for 12 months from the balance sheet date as of June 30, 2025. The Company will be dependent upon the raising of additional capital through equity and/or debt financing in order to implement its business plan and generate sufficient revenue in excess of costs. If the Company raises additional capital through the issuance of equity securities or securities convertible into equity, stockholders will experience dilution, and such securities may have rights, preferences or privileges senior to those of the holders of common stock. If the Company raises additional funds by issuing debt, the Company may be subject to limitations on its operations, through debt covenants or other restrictions. There is no assurance that the Company will be successful with future financing ventures, and the inability to secure such financing may have a material adverse effect on the Company’s financial condition. These consolidated financial statements do not include any adjustments to the amounts and classifications of assets and liabilities that might be necessary should the Company be unable to continue as a going concern. The accompanying consolidated financial statements have been prepared on a going concern basis under which the Company is expected to be able to realize its assets and satisfy its liabilities in the normal course of business. F- 7 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 2. Summary of Significant Accounting Policies Basis of Presentation and Consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and include the accounts of the Company and its wholly owned subsidiary. All intercompany balances and transactions have been eliminated. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Use of Estimates The preparation of the Company’s consolidated financial statements require management to make estimates and assumptions that impact the reported amounts of assets, liabilities and expenses and the disclosure in the Company’s consolidated financial statements and accompanying notes. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. By their nature, estimates are subject to an inherent degree of uncertainty and, as such, actual results may differ from management’s estimates. Significant estimates and assumptions made by the Company are allowance for bad debt, useful lives of fixed assets, warranty liabilities, accrued contingent liabilities, and allowance for inventory obsolescence. Foreign Currency The Company’s consolidated financial statements are reported in U.S. Dollars (“USD”), the CleanCore US’s functional currency. The functional currency for the subsidiary in Ireland, CleanCore Global, is the Euro (“EUR”). The translation of EUR into USD is performed for balance sheet accounts using the exchange rates in effect as of the balance sheet date and for revenues and expense accounts using an average exchange rate prevailing during the respective period. The gains or losses resulting from such translation are reported as currency translation adjustments under other comprehensive income/loss, or under accumulated other comprehensive income/loss as a separate component of equity. Monetary assets and liabilities of the Company that are denominated in currencies other than EUR are translated into their respective functional currency at the rates of exchange prevailing on the balance sheet date. Transactions of the Company that are denominated in currencies other than EUR are translated into the respective functional currencies at the average exchange rate prevailing during the period of the transaction. The gains or losses resulting from foreign currency transactions are included in the consolidated statements of operations. Comprehensive Income (Loss) Comprehensive income (loss) consists of two components, net income (loss) and other comprehensive income (loss), net of tax. Other comprehensive income (loss), net of tax, refers to revenue, expenses, gains, and losses that under U.S. GAAP are recorded as an element of stockholders’ equity but are excluded from net income (loss). The Company’s other comprehensive income (loss), net of tax, consists of foreign currency translation adjustments that result from consolidation of its foreign entity. Risks and Uncertainties The Company is subject to a number of risks similar to other early-stage companies including, but not limited to, profitability, the need for additional financing to achieve its business strategy, ability to obtain regulatory approval, significant competition, and dependence on key individuals. Cash and Cash Equivalents Cash consists of cash in readily available checking and money market accounts. Cash is recorded at cost, which approximates fair value. As of June 30, 2025 and 2024, cash balances were deposited at a major financial institution. Cash balances are subject to minimal credit risk as the balances are with high credit quality financial institutions. F- 8 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 Concentration of Credit Risk Financial instruments, which potentially subject the Company to significant concentration of credit risk, consist of cash. The Company maintains deposits in federally insured financial institutions in excess of respective insured limits. The Company has not experienced any losses in such accounts and management believes that the Company is not exposed to significant credit risk due to the financial position of the depository institutions in which those deposits are held. Major Customers The Company had two customers that accounted for 42 % and 17 % of its revenues for the year ended June 30, 2025 and one customer that accounted for 14 % of its revenues for the year ended June 30, 2024. Collateral is not required for customer accounts receivable balances. The Company maintains an allowance for doubtful accounts as described in “Accounts Receivable” below. The Company had one customer that accounted for 47 % of total accounts receivable as of June 30, 2025 and two customers that accounted for 28 % each of total accounts receivable as of June 30, 2024. Major Vendors The Company has a single vendor for each of its two main products from whom it exclusively purchases a major component. The Company expects to maintain this relationship with the vendor; however, it does have a contingency plan in place to use other vendors if necessary, which would result in minor production delays. Accounts Receivable Accounts receivable is comprised of trade receivables from the Company’s customers. Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company established an allowance for bad debt of accounts receivables based on a percentage assigned to aged days outstanding categories. The Company recorded an allowance for doubtful accounts of $ 122,009 and $ 2,535 as of June 30, 2025 and 2024, respectively. Inventory Inventory consists of parts, work in progress and finished goods. The Company values parts and finished goods at the lower of the actual costs or net realizable value. The Company values work in progress at cost. The Company periodically reviews inventory for obsolete and potentially impaired items. As of June 30, 2025 and 2024, the Company maintained an allowance for slow-moving and inventory obsolescence of $ 37,420 and $ 14,791 , respectively. Leases The Company accounts for leases in accordance with ASC Topic 842 (Topic 842), Leases . Right-of-use assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. The lease liability is measured as the present value of the unpaid lease payments, and the right-of-use asset value is derived from the calculation of the lease liability. Operating leases are included in right-of-use assets, current lease liabilities, and noncurrent lease liabilities in the consolidated balance sheet. Lease payments include fixed and in-substance fixed payments, variable payments based on an index or rate, reasonably certain purchase options, termination penalties, and probable amounts the lessee will owe under a residual value guarantee. Variable lease payments are recognized as lease expenses as incurred, and generally relate to variable payments made based on the level of services provided by the landlords of the leases. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term within general and administrative expenses in the consolidated statement of operations. The Company uses its estimated incremental borrowing rate, which is derived from information available at the lease commencement date, in determining the present value of lease payments because the Company does not have the information necessary to determine the rate implicit in the lease. The Company’s lease term includes any option to extend the lease when it is reasonably certain to be exercised based on consideration of all relevant factors. Leases with an initial term of 12 months or less are not recorded on the consolidated balance sheet and the Company recognizes lease expense for these leases on a straight-line basis over the lease term. F- 9 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 Business Combinations Business combinations are accounted for using the acquisition method. The fair value of total purchase consideration is allocated to the fair values of identifiable tangible and intangible assets acquired and liabilities assumed, with the remaining amount being classified as goodwill. All assets, liabilities and contingent liabilities acquired or assumed in a business combination are recorded at their fair values at the date of acquisition. Determining the fair value of assets acquired and liabilities assumed requires management to use significant judgment and estimates including the selection of valuation methodologies, estimates of future revenue and cash flows, discount rates, and selection of comparable companies. Estimates of fair value are based on assumptions believed to be reasonable, but are inherently uncertain and unpredictable and, as a result, actual results may differ from those estimates. During the measurement period, not to exceed one year from the date of acquisition, the Company may record adjustments to the assets acquired and liabilities assumed, with a corresponding offset to goodwill. At the conclusion of the measurement period, any subsequent adjustments are reflected in the consolidated statements of operations. Transaction costs associated with business combinations are expensed as incurred and are included in general and administrative expenses in the consolidated statements of operations. Asset Acquisitions Acquisitions of assets that do not meet the definition of a business are accounted for using the cost accumulation and allocation model. The cost accumulation and allocation model requires the Company to measure the assets acquired based on their cost, which is then allocated to the assets on a relative fair value basis. The cost of the assets includes direct acquisition-related costs such as fees paid to external advisors, attorneys, and accountants. When the cost of the acquired assets is greater than the fair value of the group, the excess cost is allocated to the nonfinancial assets acquired. Contingent consideration included in an asset acquisition is first assessed as to whether it qualifies as a derivative instrument. If it does, the Company would measure the contingent consideration at fair value with changes in fair value reported in earnings. If the contingent consideration is not a derivative instrument, the Company will recognize the contingent consideration when it is probable and estimable and subsequent changes are recorded as adjustments to the carrying amount of the assets acquired. Determining the fair value of assets acquired, for purposes of allocating cost based on their relative fair values, requires management to use significant judgment and estimates including the selection of valuation methodologies, estimates of future revenue and cash flows, discount rates, and selection of comparable companies. Estimates of fair value are based on assumptions believed to be reasonable, but are inherently uncertain and unpredictable and, as a result, actual results may differ from those estimates. Intangible Assets Intangible assets primarily consist of existing technology, distribution agreements, licenses, and trademarks obtained as a result of the acquisitions on October 17, 2022 and April 15, 2025. Intangible assets with definite lives are amortized based on their pattern of economic benefit over their estimated useful lives and reviewed periodically for impairment. The Company’s trademarks are deemed to have an indefinite life. The estimated useful life of the acquired technology is 15 years while the estimated useful lives of the distribution agreements and licenses is 5 years. Impairment of Long-Lived Assets Long-lived assets consist primarily of property and equipment and intangible assets. Long-lived assets are tested for impairment when events and circumstances indicate the assets might be impaired by first comparing the estimated future undiscounted cash flows of the asset or asset group to the carrying value. If the carrying value exceeds the estimated future undiscounted cash flows, an impairment loss is recognized based on the amount that the carrying value exceeds the fair value of the asset or asset group. As a result of the analysis, the Company recognized an impairment loss of $ 261,250 in general and administrative expenses on its customer relationship intangible asset during the year ended June 30, 2025. No other long-lived assets were determined to be impaired for the years ended June 30, 2025 and 2024. Subsequent evaluations will be performed annually on June 30, per the Company’s policy. F- 10 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 Impairment of Goodwill The Company evaluates goodwill for impairment annually, as of June 30, or more frequently when indicators of impairment exist. The Company considers qualitative factors including market conditions, legal factors, operating performance indicators, and competition, among others, to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount, including goodwill. If the Company concludes that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, the Company performs a quantitative impairment test. In performing the quantitative impairment test, the Company compares the fair value of its reporting unit to the carrying amount including the goodwill of the reporting unit. If the carrying value, including goodwill, exceeds the reporting unit’s fair value, the Company will recognize an impairment loss for the amount by which the carrying amount exceeds the reporting unit’s fair value. The Company performed its annual evaluation of goodwill on June 30, 2025. Based on the analysis, the Company did not recognize an impairment loss during the year ended June 30, 2025. Subsequent evaluations will be performed annually on June 30, per the Company’s policy. Fair Value Measurements The fair value of the Company’s financial instruments reflects the amounts that the Company estimates it will receive in connection with the sale of an asset in an orderly transaction between market participants at the measurement date (exit price). The fair value hierarchy prioritizes the use of inputs used in valuation techniques into the following three levels: Level 1 – Quoted prices in active markets for identical assets and liabilities. Level 2 – Observable inputs other than quoted prices in active markets for identical assets and liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets. Level 3 – Unobservable inputs. Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability. The Company’s financial assets are subject to fair value measurements on a recurring basis. The Company’s remaining carrying amounts reported in the consolidated balance sheets of these financial assets are a reasonable estimate of fair value due to their short-term nature or because their stated interest rates are indicative of market interest rates. Deferred Offering Costs As of June 30, 2025, the Company incurred $ 124,062 of costs related to a sales agreement that the Company entered into on June 20, 2025, which allows the Company to issue additional shares of stock. In accordance with ASC 340-10-S99-1 and SEC Accounting Bulletin Topic 5A, specific incremental costs incurred directly attributable to a proposed offering of securities have been deferred, to be offset against gross proceeds of such offering. These deferred offering costs included fees paid to underwriters, attorney fees, accountants fees as well as printers and other third party expenses directly related to the offering. Costs such as management salaries or other general administrative expenses that are not incremental to the offering are expensed as incurred. As of June 30, 2025, the Company has not issued any additional shares. Patent Costs Costs related to filing and pursuing patent applications are expensed as incurred, as recoverability of such expenditures is uncertain. These costs are included in general and administrative expenses. Advertising Costs The Company reports as expense the cost of advertising and promoting its services as incurred. Such amounts totaled $ 92,598 and $ 116,007 for the year ended June 30, 2025 and 2024, respectively. F- 11 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 Stock-based Compensation Compensation expense is recognized for all share-based payments to employees and non-employees, including stock options, restricted stock awards, and warrants, in the statements of operation based on the fair value of the awards that are granted. As necessary, the Company’s stock price at the date of grant was estimated using an acceptable valuation technique such as the probability-weighted expected return model. The fair value of stock options and warrants are estimated at the date of grant using the Black-Scholes option-pricing model. The fair value of restricted stock awards is based on the fair market value of the Company’s class B common stock on the date of grant. Compensation expense for restricted stock awards with performance-based vesting conditions is calculated based on the number of awards that are expected to vest during the performance period if it is probable that the performance metrics will be achieved. Generally, measured compensation cost, net of actual forfeitures, is recognized on a straight-line basis over the vesting period of the related share-based compensation award. The Company accounts for forfeitures of stock-based awards as they occur. Revenue Recognition The Company generates revenues from sales of its products and recognizes revenue as control of its products is transferred to its customers, which is generally at the time of shipment based on the contractual terms with the Company’s customers. The Company provides customer programs and incentive offerings, including growth incentives and volume-based incentives. These customer programs and incentives are considered variable consideration. The Company includes in revenue variable consideration only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the variable consideration is resolved. This determination is made based upon known customer program and incentive offerings at the time of sale and expected sales volume forecasts as it relates to the Company’s volume-based incentives. This determination is updated every reporting period. For the years ended June 30, 2025 and 2024, customer growth and volume-based incentives were minimal. Certain product sales include a 2-year manufacturer’s warranty that provides the customer with assurance that the product performs as intended. Such warranties are assurance-type warranties and are accounted for as contingencies under ASC 460-10. Refer to Note 10 for warranty reserve. Income Taxes The Company accounts for income tax on the basis of the tax laws enacted at the balance sheet date in accordance with ASC 740, Income Taxes . The income tax accounting guidance results in two components of income tax expense: current and deferred. Current income tax expense reflects taxes to be paid or refunded for the current period by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues. The Company determines deferred income taxes using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is based on the tax effects of the differences between the book and tax bases of assets and liabilities, and enacted changes in tax rates and laws are recognized in the period in which they occur. Deferred income tax expense results from changes in deferred tax assets and liabilities between periods. Deferred tax assets are reduced by a valuation allowance if, based on the weight of evidence available, it is more-likely-than-not that some portion or all of a deferred tax asset will not be realized. Tax positions are recognized if it is more-likely-than-not, based on technical merits, that the tax position will be realized or sustained upon examination. The term “more-likely-than-not” means a likelihood of more than 50%. The terms examined and upon examination also include resolution of the related appeals or litigation processes, if any. A tax position that meets the more-likely-than-not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than 50 % likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. The determination of whether or not a tax position has met the more-likely-than-not recognition threshold considers the facts, circumstances and information available at the reporting date and is subject to management’s judgment. F- 12 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 Net Loss per Share of Common Stock Basic net loss per class A and class B common share is calculated by dividing the net loss distributed to class A and class B, respectively, by the weighted-average number of common shares of each respective class outstanding during the period, without consideration for potentially dilutive securities. Diluted net loss per share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common shares and potentially dilutive securities outstanding for the period. For purposes of the diluted net loss per share calculation, stock options, warrants and convertible debt are considered to be potentially dilutive securities. As of June 30, 2025 and 2024, there were 1,729,477 and 3,382,500 , respectively, of potential common stock equivalents excluded from the diluted loss per share calculations as their effect is anti-dilutive. Because the Company has reported a net loss for the years ended June 30, 2025 and 2024, diluted net loss per common share is the same as basic net loss per common share for such years. Segment reporting Operating segments are defined as components of an entity where discrete financial information is evaluated regularly by the Chief Executive Officer as the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. The Company’s CODM reviews financial information presented on a consolidated basis for the purposes of making operating decisions, fund raising, allocating resources and evaluating financial performance. Accordingly, the Company has determined that it operates in a single reporting segment. Recent Accounting Pronouncements Accounting Pronouncements Adopted In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures , which improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The guidance in this update is effective for all public entities for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. The Company has adopted this pronouncement for the fiscal year beginning July 1, 2024, which did not result in a material impact on its consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . ASU 2016-13 requires measurement and recognition of expected credit losses for financial assets by requiring an allowance to be recorded as an offset to the amortized cost of such assets. The standard primarily impacts the amortized cost of the Company’s available-for-sale debt securities. The Company adopted this standard, which did not result in a material impact on its consolidated financial statements. Accounting Pronouncements Pending Adoption In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures , which requires greater disaggregation of income tax disclosures related to the income tax rate reconciliation and income taxes paid, and is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued. The amendments should be applied on a prospective basis although retrospective application is permitted. The Company is currently evaluating the effects of this pronouncement on its financial statements and disclosures. In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses , which requires public companies to disaggregate key expense categories such as inventory purchases, employee compensation and depreciation in their financial statements. Further, in January 2025, the FASB issued ASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date , which clarifies the effective date of ASU 2024-03. The guidance is effective for all public entities with fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning afterDecember15, 2027. Early adoption is permitted. The Company is evaluating the impact that adoption of this provision may have on its consolidated financial statements. F- 13 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 In December 2024, the FASB issued ASU 2024-03, Debt—Debt with Conversion and Other Options (Subtopic 470- 20): Induced Conversions of Convertible Debt Instruments . The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2025 (and interim reporting periods within those annual reporting periods). Early adoption is permitted as of the beginning of a reporting period if the entity has also adopted ASU 2020-06 for that period. The Company is evaluating the impact that adoption of this provision may have on its consolidated financial statements. 3. Disaggregated Revenue The following table disaggregates revenue by product category for the following periods: Years Ended June 30, 2025 2024 Janitorial and Sanitation $ 1,811,870 $ 1,518,079 Ice System 66,691 19,495 Other 194,273 67,399 Total Revenue $ 2,072,834 $ 1,604,973 The “Other” category of revenue consists primarily of sales of parts, accessories, shipping and handling, and equipment rental income. 4. Asset Acquisition On April 15, 2025, the Company completed its acquisition of specified assts of Sanzonate Europe Ltd. (“Sanzonate”). Sanzonate was a former customer of the Company that produces products similar to the Company’s products. The assets acquired included accounts receivable, inventory, and intangibles. The intangibles consisted of a license issued by the European Organization for Technical Assessment to sell ozone products in the European Union (“EOTA license”), Sanzonate’s trade name, and distribution agreements. The Company also retained one sales representative and one administrative resource. The Company entered into this transaction to expand its presence in the European Union. The total cost of the assets consisted of the following: Consideration Total Asset Cost Cash $ 425,000 Promissory note 800,000 Warrant 181,475 Direct acquisition-related costs 156,792 Total $ 1,563,267 The promissory note is a 10 % subordinated note with a principal amount of $ 800,000 bearing interest at ten percent ( 10 %) per annum, payable quarterly, and is due and payable on April 15, 2027. The promissory note was issued at market and therefore, the carrying amount represents fair value. The warrant is for the purchase up to 425,000 shares of the Company’s class B common stock at an exercise price of $ 1.25 per share. The Company obtained an external valuation of the warrant noting a fair value of $ 181,475 . In addition, the transaction includes contingent consideration in the form of an earnout of up to $ 1,250,000 to the extent that Net Sales (as defined in the asset purchase agreement) achieve certain milestones during the five-year period beginning on the closing date. The Company determined that reaching such milestones was not probable as of the acquisition date and therefore, the contingent consideration was not included in the total cost of the assets acquired. If the Company determines that earnout payments will be made, the additional cost will be allocated to the non-financial assets in the period the payments are determined to be probable. Management concluded that the transaction does not constitute a business combination and therefore will account for the transaction in accordance with ASC 805-50, Acquisition of Assets Rather than a Business . The total cost of the assets was allocated to the acquired assets in accordance with ASC 805-50, Acquisition of Assets Rather than a Business , as follows: F- 14 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 Asset Allocated Cost Accounts receivable $ 272,658 Inventory 348,222 EOTA license 339,877 Trade name 324,428 Distribution agreements 278,082 Total $ 1,563,267 The accounts receivable were assessed for collectability and recorded at fair value as of the closing date. Similarly, inventory was reviewed for obsolescence and recorded at fair value as of the closing date. The EOTA license allows the Company to sell ozone products in the European Union (“EU”). The EOTA license will be amortized over an estimated useful life of five years . Sanzonate’s trade name will continue to be used, as necessary, when customers have preexisting relationship with Sanzonate. The trade name will be amortized over an estimated useful life of five years . Sanzonate’s distribution agreements are agreements with distributors in the EU that sell product to end users. The Company intends to utilize the existing distributors, but also expand on both distributors and non-distributor customers in the EU. The distribution agreements will be amortized over an estimated useful life of five years . The Company engaged a third-party valuation firm to determine the fair values of the intangible assets. The intangible assets were valued using a discounted cash flow method. Key inputs and assumptions include projected cash flows and the discount rate used to calculate the present value of such cash flows. In addition, all long-lived assets will be tested for impairment when events and circumstances indicate the assets might be impaired. 5. Accounts Receivable, Net Accounts receivable, net consists of the following at: June 30, 2025 June 30, 2024 Trade accounts receivable $ 779,692 $ 469,821 Allowance for doubtful accounts ( 122,009 ) ( 2,535 ) Total accounts receivable, net $ 657,683 $ 467,286 6. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consists of the following at: June 30, 2025 June 30, 2024 Prepaid inventory parts $ 27,510 $ 5,277 Prepaid insurance 46,141 32,943 Prepaid certification and fees 101,141 3,172 Prepaid other 52,772 13,973 Total prepaid expenses and other current assets $ 227,564 $ 55,365 7. Inventory Inventory consists of the following at: June 30, 2025 June 30, 2024 Parts $ 386,510 $ 503,004 Finished goods 998,603 184,112 Inventory reserve ( 37,420 ) ( 14,790 ) Total inventory, net $ 1,347,693 $ 672,326 F- 15 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 The Company values inventory at the balance sheet date using the weighted average method. The Company recorded an inventory reserve of $ 37,420 and $ 14,790 as of June 30, 2025 and 2024, respectively. 8. Property and Equipment, Net Property and equipment, net, consist of the following at: June 30, 2025 June 30, 2024 Equipment $ 36,281 $ 8,217 Leasehold improvements 7,806 3,481 Total 44,087 11,698 Less: accumulated depreciation ( 11,539 ) ( 1,126 ) Total property and equipment, net $ 32,548 $ 10,572 Depreciation expense related to property and equipment was $ 10,414 and $ 1,063 for the years ended June 30, 2025 and 2024, respectively. 9. Intangible Assets Intangible assets consist of the following at: June 30, 2025 June 30, 2024 Technology $ 600,000 $ 600,000 Customer relationships - 570,000 Distribution agreements 586,831 - Trademarks 904,428 580,000 License 339,576 - Total 2,430,835 1,750,000 Less: accumulated amortization ( 456,326 ) ( 263,077 ) Total intangible assets, net $ 1,974,509 $ 1,486,923 The Company holds 15 patents, which are included in technology. These patents cover the functions of the Company’s products that allow its machines to produce the ozone in the form of nanobubbles. As a result of the Company’s annual impairment evaluation, an impairment loss on customer relationships of $ 261,250 was recorded as of June 30, 2025. Amortization expense related to intangibles was $ 193,364 and $ 153,996 for the years ended June 30, 2025 and 2024, respectively. 10. Accounts Payable and Accrued Expenses Accounts payable and accrued expenses consist of the following at: June 30, 2025 June 30, 2024 Accounts payable $ 909,294 $ 176,077 Accrued interest 44,459 23,113 Accrued payroll and related expenses 111,437 59,943 Accrued pending litigation - 112,005 Warranty reserve 69,734 96,636 Accrued severance - 70,000 Accrued legal 70,425 32,259 Contract termination 100,000 - Other accrued expenses 74,936 3,923 Total accounts payable and other accrued expenses $ 1,380,285 $ 573,956 On June 6, 2025, the Company entered into a settlement and release agreement with its former Chief Executive Officer, which was effective June 21, 2025. This settlement required the Company to issue shares of class B common stock to an unrelated third party (Note 13) and released claims by each party, therefore the Company released the $ 112,005 pending litigation accrual into miscellaneous income for the year ended June 30, 2025. F- 16 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 11. Debt Promissory Notes On October 17, 2022, the Company issued a promissory note in the principal amount of $ 3,000,000 to Burlington Capital, LLC (“Burlington”), which bore interest at 7 % per annum and was to mature on October 17, 2023 . On September 13, 2023, the parties signed an extension agreement, pursuant to which the interest rate was increased to 10 % per annum and the maturity date was extended to the earlier of (a) the closing of a firm commitment initial public offering and concurrent listing on a national securities exchange or (b) December 17, 2023. On December 17, 2023, the parties signed a second extension agreement, pursuant to which the maturity date was extended to the earlier of (a) the closing of a firm commitment initial public offering and concurrent listing on a national securities exchange or (b) April 4, 2024. On April 30, 2024, the Company and Burlington entered into an extension agreement which extended the maturity date to May 9, 2024 . On May 31, 2024, Burlington and Walker Water LLC (“WW”) entered into an allonge, assignment and agreement (the “Burlington Assignment Agreement”), pursuant to which Burlington agreed to transfer $ 633,840 of the note to WW. The Burlington Assignment Agreement also provided that the Company make a payment of $ 900,000 on May 31, 2024 to Burlington to reduce the principal amount of the note by $ 480,667 and pay the outstanding accrued interest of $ 419,333 in full. Also on May 31, 2024, the Company issued an amended and restated promissory note to Burlington (the “Burlington Note”). The Burlington Note has a new principal amount of $ 2,366,160 , accrues interest at 8.5 % per annum from October 17, 2022 (the date of the original note), which shall increase to 10 % upon an event of default, and requires quarterly payments in the amount of $ 100,000 over the course of the next two and a half years, with a final payment of $ 1,396,881 due on April 1, 2027 . The Burlington Note may be prepaid at any time with no pre-payment penalty and contains customary events of default for a note of this type. Although the Company did not timely make certain payments as required under the Burlington Note, Burlington has agreed to waive any default caused by such lack of payment and has not accelerated payment under the Burlington Note. On June 30, 2025, the Company and Burlington entered into conversion agreements pursuant to which the quarterly payments of $ 100,000 that were due on each of January 1, 2025, April 1, 2025 and July 1, 2025 were converted into an aggregate of 133,500 shares of the Company’s class B common stock. As of June 30, 2025, the outstanding principal balance of the Burlington Note is $ 1,760,314 and it has an accrued interest balance of $ 0 . Pursuant to the Burlington Assignment Agreement, the Company also issued a promissory note to WW in the principal amount of $ 633,840 (the “WW Note”). The WW Note accrued interest at 8.5 % per annum from October 17, 2022 (the date of the original note), which shall increase to 10 % upon an event of default, and was due on December 31, 2024 . On December 24, 2024, the Company entered into a note assignment and cancellation agreement (the “WW Assignment Agreement”) with WW, Gary Hollst, the Company’s Chief Revenue Officer, and Gary Rohwer, a third party, pursuant to which WW assigned half of its right, title and interest in and to the WW Note to Garry Hollst and the remaining half to Gary Rohwer. Accordingly, the WW Note was cancelled and the Company issued a promissory note in the principal amount of $ 316,920 to Gary Hollst and a promissory note in the principal amount of $ 316,920 and accrued interest of $ 15,714 to Gary Rohwer (the “Rohwer Note”). Please see Note 12 for a description of the promissory note issued to Gary Hollst. The Rohwer Note was due and payable on December 31, 2024. On December 30, 2024, the Company repaid the Rohwer Note in full. On April 15, 2025, CleanCore Global issued a 10 % subordinated promissory note in the principal amount of $ 800,000 to Sanzonate. The note bears interest at a rate of 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. As of June 30, 2025, the outstanding principal balance of this note is $ 800,000 and it has an accrued interest balance of $ 6,667 . F- 17 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 On April 16, 2025, the Company entered into subscription agreements with several accredited investors for the purchase of (i) 12 % unsecured 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 the Company’s class B common stock at an exercise price of $ 1.06 per share for an aggregate purchase price of $ 1,010,000 . The notes bear interest at a rate of 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. As of June 30, 2025, the outstanding principal balance of these notes is $ 1,010,000 and they have an accrued interest balance of $ 10,100 . On June 6, 2025, the Company entered into a subscription agreement with an accredited investor for the purchase of (i) a 12 % unsecured promissory note in the principal amount of $ 500,000 and (ii) a five-year warrant to purchase 66,667 shares of the Company’s class B common stock at an exercise price of $ 1.06 per share for a purchase price of $ 500,000 . The note bears interest at a rate of 12 % per annum, payable quarterly, and is due and payable on June 6, 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. As of June 30, 2025, the outstanding principal balance of this note is $ 500,000 and it has an accrued interest balance of $ 3,833 . On June 30, 2025, the Company issued to an accredited investor (i) an original issue discount promissory note in the principal amount of $ 520,000 and (ii) a five-year warrant to purchase 25,000 shares of the Company’s class B common stock at an exercise price of $ 2.00 per share for a purchase price of $ 500,000 . This note is due and payable on October 10, 2025 and accrues interest at a rate of 15 % 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. Upon an event of default, the Company is required to issue 200,000 shares of its class B common stock to the holder. As of June 30, 2025, the outstanding principal balance of this note is $ 520,000 and it has a discount balance of $ 20,000 and an accrued interest balance of $ 0 . Line of Credit On June 28, 2024, the Company entered into a loan agreement with Arbor Bank for a revolving line of credit in the amount of $ 100,000 with a variable interest rate tied to the U.S. Prime Rate. Monthly payments of accrued interest are due beginning July 28, 2024. The principal and any outstanding accrued interest are due in full on June 28, 2025. The Company drew on the line during May 2025 and paid the outstanding balance and interest in full as well as terminated the line of credit in June 2025. Total interest payments during the year ended June 30, 2025 were $ 199 . 12. Related Party Transactions As of June 30, 2025 and 2024, the Company had a short-term amount due to Clayton Adams, its Chief Executive Officer and founder, in the amount of $ 41,895 and $ 91,119 , respectively, for operational expenses paid by a credit card in his name. The Company has a verbal agreement with Mr. Adams to pay the credit card charges directly to the issuing financial institution as they become due and is current on these payments. On October 4, 2022, the Company issued a promissory note to each of Matthew Atkinson, the Company’s Chief Executive Officer at such time, and Clayton Adams in the principal amount of $ 104,450 each for a total of $ 208,900 . These notes bore interest at a rate of 5 % per annum beginning on the 30th day after issuance and were due on the 60th day following written demand from the holder. On May 29, 2024, the Company repaid these two promissory notes, including interest accrued of $ 8,506 each. F- 18 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 On October 17, 2022, the Company entered into a consulting agreement with Birddog Capital, LLC (“Birddog”), a limited liability company owned by Clayton Adams, pursuant to which the Company engaged Birddog to provide management services to the Company. Pursuant to the consulting agreement, the Company agreed to pay Birddog a monthly fee of $ 6,000 commencing on October 17, 2022. The Company also agreed to reimburse Birddog for all pre-approved business expenses. The term of the consulting agreement was for one (1) year. On April 1, 2024, the Company entered into a new consulting agreement with Birddog which provides for a monthly fee of $ 22,000 . In addition, the Company agreed to pay Birddog $ 175,000 upon completion of the initial public offering and grant Birddog 500,000 restricted stock units, with 250,000 shares vesting immediately and 250,000 shares vesting eighteen months after issuance. The Company did not make such payment or issue such shares upon completion of the initial public offering. On June 11, 2025, the Company and Birddog entered into an amendment to the consulting agreement, pursuant to which the Company agreed to pay Birddog a monthly fee of $ 22,000 and deferred expenses of up to $ 25,000 . The Company also agreed to issue to Clayton Adams 500,000 restricted stock units, vesting immediately, and agreed to pay Birddog $ 175,000 no earlier than August 1, 2025 and no later than December 31, 2025. The Company has accrued $ 175,000 in full as of June 30, 2025. The consulting agreement expires on October 23, 2025 . On July 27, 2023, the Company agreed to purchase approximately $ 105,000 worth of inventory from Nebraska C. Ozone, LLC, a related party business owned by Lisa Roskens, a significant stockholder and the principal officer of Burlington, due to an open purchase order that the Company’s predecessor had with an inventory vendor that was not included in the liabilities assumed from the predecessor per the terms of the acquisition purchase agreement. The inventory is to be purchased as needed, consistent with other inventory purchases. However, if the entire $ 105,000 amount is not purchased by March 31, 2024, the balance at that date begins accruing interest at a rate of seven percent ( 7 %) per annum until it is paid in full. As of June 30, 2025, the Company has purchased $ 12,578 of the inventory, with an outstanding payable balance of $ 105,000 , and has an accrued interest balance of $ 9,843 . On March 26, 2024, the Company entered into a loan agreement with Clayton Adams, pursuant to which the Company issued a revolving credit note to Mr. Adams in the principal amount of up to $ 500,000 . Pursuant to the loan agreement and note, Mr. Adams agreed to provide advances to the Company upon request during the period commencing on April 25, 2024 and continuing until the second anniversary of such date, or the maturity date. This note accrues simple interest on the outstanding principal amount at the rate of 8 % per annum, with all principal and interest due on the maturity date; provided that upon an event of default (as defined in the note), such rate shall increase to 13 %. The Company may prepay the note at any time without penalty or premium. The note is unsecured and contains customary events of default for a loan of this type. As of June 30, 2025, no advances have been made, and the principal amount of this note is $ 0 . On December 24, 2024, the Company issued a promissory note in the principal amount of $ 316,920 to Gary Hollst, the Company’s Chief Revenue Officer. The note was originally due and payable on May 31, 2025 and did not accrue interest. On May 2, 2025, the note was amended and restated in its entirety and the Company issued to Mr. Hollst an amended and restated promissory note in the principal amount of $ 342,154.57 . The amended and restated promissory note was due and payable on May 31, 2026 and accrued interest at a rate of 8.5 % per annum. The amended and restated promissory note could be converted at the holder’s option at any time into shares of the Company’s class B common stock at a conversion price of $ 1.12 (subject to standard adjustments for stock splits, stock dividends, reclassifications and similar transactions). On June 2, 2025, all principal and interest due under the amended and restated promissory note in the amount of $ 344,625 was converted into 307,701 shares of the Company’s class B common stock. On December 24, 2024, the Company issued a 20 % original issue discount promissory note in the principal amount of $ 415,241 to Clayton Adams. On January 27, 2025, Mr. Adams entered into a note sale assignment and cancellation agreement with Travis Buchanan, the Company’s President, pursuant to which Mr. Adams sold and assigned $ 125,000 of the note to Mr. Buchanan for a purchase price of $ 100,000 . Following such assignment, the Company issued a 20 % original issue discount promissory note in the principal amount of $ 290,241.25 to Mr. Adams. This note accrues interest at a rate of 8 % per annum; provided that upon an event of default (as defined in the note), such interest rate shall increase to 15 % per annum. The note was originally due and payable on June 30, 2025. On May 2, 2025, the parties entered into an amendment pursuant to which the maturity date was changed to require repayment with sixty (60) days of written demand from Mr. Adams. 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. As of June 30, 2025, the outstanding principal balance of this note is $ 290,241 and it has a discount balance of $ 0 and an accrued interest balance of $ 9,797 . F- 19 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 Following the assignment described above, the Company issued a 20 % original issue discount promissory note in the principal amount of $ 125,000 to Mr. Buchanan. This note accrues interest at a rate of 8 % per annum; provided that upon an event of default (as defined in the note), such interest rate shall increase to 15 % per annum. The note was originally due and payable on June 30, 2025. On May 2, 2025, the parties entered into an amendment pursuant to which the maturity date was changed to require repayment with sixty (60) days of written demand from Mr. Buchanan. 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. As of June 30, 2025, the outstanding principal balance of this note is $ 125,000 and it has a discount balance of $ 0 and an accrued interest balance of $ 4,219.18 . ACME People Company, a company owned and controlled by Travis Buchanan, the Company’s President, participated in the private placement of promissory notes and warrants that was completed on April 16, 2025 (see Note 11) and was issued (i) a 12% unsecured promissory note in the principal amount of $ 10,000 and (ii) a five-year warrant to purchase 1,333 shares of the Company’s class B common stock at an exercise price of $ 1.06 per share. Intercompany Promissory Note In connection with the acquisition of the assets of Sanzonate, on April 15, 2025, CleanCore Global issued a 7% unsecured promissory note in the principal amount of $ 475,000 to CleanCore US. The note bears interest at a rate of 7 % per annum commencing on April 15, 2027 with all principal and interest due and payable on April 15, 2030. 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. As of June 30, 2025, the outstanding principal balance of this note is $ 475,000 and it has an accrued interest balance of $ 6,728 . This loan and related interest is eliminated in consolidation. 13. Stockholders’ Equity The Company’s authorized capital stock as of June 30, 2025 consists of 350,000,000 shares, consisting of (i) 300,000,000 shares of common stock, par value $ 0.0001 per share, of which 50,000,000 shares are designated class A common stock and 250,000,000 shares are designated as class B common stock; and (ii) 50,000,000 shares of “blank check” preferred stock, par value $ 0.0001 per share. Series Seed Preferred Stock The Company was previously authorized to issue shares of series seed preferred stock. During the year ended June 30, 2024, the remaining 4,000,000 shares of series seed preferred stock were converted into 4,000,000 shares of class A common stock. As of June 30, 2025 and 2024, no shares of series seed preferred stock were issued and outstanding. Common Stock The Company has two classes of authorized common stock — class A common stock and class B common stock. The rights of the holders of the class A common stock and class B common stock are identical, except with respect to voting and conversion. Each share of class A common stock is entitled to ten votes per share and is convertible into one share of class B common stock. Each share of class B common stock is entitled to one vote per share. As of June 30, 2025, all of the outstanding class A common stock was held by one of the Company’s founders, which is also the current Chief Executive Officer. For the Year Ended June 30, 2025 On July 12, 2024, the Company issued 5,000 shares of class B common stock upon vesting of a restricted stock unit award granted under the Company’s 2022 Equity Incentive Plan, as amended (the “2022 Plan”). On September 19, 2024, the Company issued 4,166 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. On October 19, 2024, the Company issued 4,166 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. On October 30, 2024, 270,000 shares of class A common stock were converted into 270,000 shares of class B common stock. F- 20 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 On November 19, 2024, the Company issued 4,166 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. On December 18, 2024, the Company issued 18,000 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. On December 19, 2024, the Company issued 4,166 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. On January 2, 2025, the Company issued 20,000 shares of class B common stock pursuant to the terms of a separation agreement with the Company’s former Chief Executive Officer. On January 2, 2025, the Company issued 75,000 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. On January 19, 2025, the Company issued 4,166 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. On February 19, 2025, the Company issued 4,166 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. On March 19, 2025, the Company issued 4,166 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. On April 1, 2025, the Company issued an aggregate of 14,618 shares of class B common stock upon vesting of restricted stock unit awards granted under the 2022 Plan. On April 15, 2025, the Company issued 50,000 shares of class B common stock pursuant to a restricted stock award and 20,000 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. On April 19, 2025, the Company issued 4,166 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. On May 6, 2025, the Company issued an aggregate of 13,172 shares of class B common stock pursuant to restricted stock awards granted under the 2022 Plan. On May 19, 2025, the Company issued 4,166 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. On May 30, 2025, the Company issued an aggregate of 271,657 shares of class B common stock upon the exercise of warrants for proceeds of $ 339,171 . On June 2, 2025, the Company issued 307,701 shares of class B common stock upon conversion of the amended and restated promissory note issued on May 2, 2025 (see Note 12). On June 3, 2025, the Company issued 1,875,795 shares of class A common stock to Clayton Adams upon the cashless exercise of stock options. On June 9, 2025, the Company issued 13,333 shares of class B common stock upon the exercise of warrants for proceeds of $ 14,133 . On June 11, 2025, the Company issued 46,667 shares of class B common stock upon the exercise of warrants for proceeds of $ 49,467 . On June 11, 2025, the Company issued 500,000 shares of class B common stock pursuant to a restricted stock award granted under the 2022 Plan. On June 19, 2025, the Company issued 4,166 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. F- 21 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 On June 21, 2025, the Company issued 200,000 shares of class B common stock pursuant to the terms of a settlement agreement with the Company’s former Chief Executive Officer. On June 30, 2025, the Company issued 133,500 shares of class B common stock to Burlington upon the conversion of quarterly payments of $ 100,000 that were due on each of January 1, 2025, April 1, 2025 and July 1, 2025 under the terms of the amended and restated promissory note issued to Burlington on May 31, 2024 (see Note 11). As of June 30, 2025, there were 1,875,795 shares of class A common stock and 9,961,227 shares of class B common stock issued and outstanding. For the Year Ended June 30, 2024 On July 16, 2023, the Company issued 1,000,000 shares of class A common stock upon the conversion of 1,000,000 shares of series seed preferred stock. On July 17, 2023, the Company issued 940,000 shares of class B common stock upon the conversion of 940,000 shares of class A common stock. On July 24, 2023, the Company issued 370,000 shares of class B common stock upon the conversion of 370,000 shares of class A common stock. On February 5, 2024, the Company issued 750,000 shares of class A common stock upon the conversion of 750,000 shares of series seed preferred stock, which were immediately converted into 750,000 shares of class B common stock upon issuance. On February 6, 2024, the Company issued 200,000 shares of class B common stock upon the conversion of 200,000 shares of class A common stock. On February 7, 2024, the Company issued 1,250,000 shares of class A common stock upon the conversion of 1,250,000 shares of series seed preferred stock, which were immediately converted into 1,250,000 shares of class B common stock upon issuance. On April 30, 2024, the Company issued 1,000,000 shares of class A common stock upon the conversion of 1,000,000 shares of series seed preferred stock. On April 30, 2024, the Company sold 1,250,000 shares of class B common stock in its initial public offering for proceeds of $ 3,343,547 , net of $ 1,656,453 of issuance and deferred offering costs. On April 30, 2024, the Company issued 175,000 shares of class B common stock pursuant to a restricted stock award and 87,500 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. On May 2, 2024, the Company issued an aggregate of 257,479 shares of class B common stock upon the conversion of 10 % original issue discount convertible promissory notes issued on January 30, 2024, which included principal of $ 225,000 and accrued interest of $ 37,479 . On May 15, 2024, the Company issued 880,000 shares of class B common stock upon the conversion of 880,000 shares of class A common stock. On June 12, 2024, the Company issued 5,000 shares of class B common stock upon vesting of a restricted stock unit award granted under the 2022 Plan. As of June 30, 2024, there were 270,000 shares of class A common stock and 7,960,919 shares of class B common stock issued and outstanding. F- 22 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 2022 Equity Incentive Plan On September 16, 2022, the Company’s board of directors adopted the 2022 Plan, which was adopted by stockholders on November 18, 2022, which reserved a total of 1,736,819 share of the Company’s class B common stock for issuance. On January 3, 2024, the Company adopted an amendment to the 2022 Plan, which increased the total shares of class B common stock available for grant to 3,240,000 . Additionally, the number of shares of class B common stock available for issuance under the 2022 Plan will automatically increase on January 1 of each calendar year during the term of the 2022 Plan by an amount equal to 5 % of the total number of shares of class B common stock issued and outstanding on December 31 of the immediately preceding calendar year. On January 1, 2025, the number of shares reserved under the 2022 Plan was increased to 3,653,529 pursuant to this provision. On June 5, 2025, the number of shares reserved under the 2022 Plan was increased to 5,000,000 upon stockholder approval of such increase on such date. Incentive awards authorized under the 2022 Plan include, but are not limited to, nonqualified stock options, incentive stock options, restricted stock awards, restricted stock units, performance grants intended to comply with Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), and stock appreciation rights. If an incentive award granted under the 2022 Plan expires, terminates, is unexercised or forfeited, the surrendered shares will become available for future awards under the 2022 Plan. The Company’s employees and advisors were granted awards under the 2022 Plan. Therefore, an allocation of the share-based compensation was made to the Company. Stock Options During the year ended June 30, 2025, the Company issued options to purchase 150,000 shares of class B common stock at an exercise price of $ 3.73 per share under the 2022 Plan, of which 15,000 shares vest upon grant and the remaining shares vest over 24 months. During the same year, options to purchase an aggregate of 461,875 shares of class B common stock were forfeited. In addition, options to purchase 2,000,000 shares of class A common stock were exercised on a cashless basis resulting in the issuance of 1,875,795 shares of class A common stock and the cancellation of the remaining 124,205 options. During the year ended June 30, 2024, the Company issued options to purchase 525,000 shares of class B common stock at an exercise price of $ 4.00 per share under the 2022 Plan. Warrants For the Year Ended June 30, 2025 On July 11, 2024, the Company issued four warrants for the purchase of 25,000 each ( 100,000 in the aggregate) at exercise prices of $ 2.20 , $ 3.00 , $ 4.00 and $ 5.00 , respectively (subject to adjustments for stock dividends, stock splits, mergers, consolidations and similar transactions). On April 15, 2025, Company issued a five-year warrant for the purchase of 425,000 shares of class B common stock at an exercise price of $ 1.25 per share (subject to adjustments for stock dividends, stock splits, mergers, consolidations and similar transactions) in connection with the acquisition of the assets of Sanzonate. Subsequently, an aggregate of 271,657 warrants were exercised for cash proceeds of $ 339,571 . On April 16, 2025, the Company issued five-year warrants for the purchase of an aggregate of 134,666 shares of class B common stock at an exercise price of $ 1.06 per share (subject to adjustments for stock dividends, stock splits, mergers, consolidations and similar transactions). Subsequently, an aggregate of 60,000 warrants were exercised for cash proceeds of $ 63,600 . On June 6, 2025, the Company issued a five-year warrant for the purchase of 66,667 shares of class B common stock at an exercise price of $ 1.06 per share (subject to adjustments for stock dividends, stock splits, mergers, consolidations and similar transactions). F- 23 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 On June 9, 2025, the Company issued to Boustead Securities, LLC (“Boustead”), the representative of the underwriters in the Company’s initial public offering (i) a five-year warrant for the purchase of 29,750 shares of class B common stock at an exercise price of $ 1.25 per share (subject to adjustments for stock dividends, stock splits, mergers, consolidations and similar transactions) and (ii) a five-year warrant for the purchase of 9,426 shares of class B common stock at an exercise price of $ 1.06 per share (subject to adjustments for stock dividends, stock splits, mergers, consolidations and similar transactions) as part of a settlement agreement. On June 30, 2025, the Company issued a five-year warrant for the purchase of 25,000 shares of class B common stock at an exercise price of $ 2.00 per share (subject to adjustments for stock dividends, stock splits, mergers, consolidations and similar transactions). For the Year Ended June 30, 2024 On October 14, 2022 and November 29, 2022, the Company issued warrants for the purchase of 42,241 and 4,022 shares of class B common stock, respectively, to a third party as part of their compensation earned. The warrants are exercisable for a period of five years at an exercise price of $ 1.74 (subject to adjustments for stock dividends, stock splits, mergers, consolidations and similar transactions). On March 5, 2024, the Company cancelled these warrants without issuing a replacement award. As the warrants were already vested, previously recognized compensation cost was not reversed. On April 30, 2024, the Company issued a warrant for the purchase of 87,500 shares of class B common stock at an exercise price of $ 5.00 , subject to adjustments, to the representative of the underwriters in the initial public offering. The warrant is exercisable at any time and from time to time, in whole or in part, during the period commencing on April 30, 2024 and ending on April 25, 2029 and may be exercised on a cashless basis under certain circumstances. Restricted Stock Awards For the Year Ended June 30, 2025 On September 19, 2024, the Company granted a restricted stock unit award under the 2022 Plan for 295,000 shares of class B common stock, of which 150,000 shares will vest in equal parts over the course of thirty-six (36) months, with 1/36th vesting each month commencing on the grant date and thereafter on the same day of the month as the grant date, and the remaining shares will vest as the Company achieves certain sales targets in a twelve-month period. On January 2, 2025, the Company granted a restricted stock unit award under the 2022 Plan for 200,000 shares of class B common stock, of which 75,000 shares vested on the date of grant, and the remaining shares will vest quarterly over three years . On March 20, 2025, the Company granted a restricted stock unit award under the 2022 Plan for 16,807 shares of class B common stock which will vest quarterly over one year commencing on April 1, 2025. On April 15, 2025, the Company granted a restricted stock unit award under the 2022 Plan for 100,000 shares of class B common stock, of which 20,000 shares vested immediately and the remaining shares will vest quarterly over two years . On April 15, 2025, the Company granted a restricted stock award under the 2022 Plan for 50,000 shares of class B common stock, all of which vested in full on the date of grant. On May 6, 2025, the Company granted restricted stock awards under the 2022 Plan for an aggregate of 13,172 shares of class B common stock, all of which vested in full on the date of grant. On May 6, 2025, the Company granted a restricted stock unit award under the 2022 Plan for 90,000 shares of class B common stock which will vest quarterly over one year commencing on July 1, 2025. On June 2, 2025, the Company granted a restricted stock award under the 2022 Plan for 307,701 shares of class B common stock, all of which vested in full on the date of grant. On June 11, 2025, the Company granted a restricted stock award under the 2022 Plan for 500,000 shares of class B common stock, all of which vested in full on the date of grant. F- 24 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 For the Year Ended June 30, 2024 On April 30, 2024, the Company granted a restricted stock award under the 2022 Plan for 175,000 shares of class B common stock, of which 15,000 shares vested on the date of grant, 10,625 shares will vest quarterly through June 30, 2026 and the remaining 75,000 shares will vest as the grantee reaches certain sales targets in a twelve-month period. On April 30, 2024, the Company granted a restricted stock unit award under the 2022 Plan for 1,300,000 shares of class B common stock, of which 87,500 shares vested and were issued on the date of grant. In June 2024, the participant and the Company agreed to separate. As a result, the participant kept the 87,500 shares that were vested and forfeited all other shares available under the award. On June 12, 2024, the Company granted a restricted stock unit award under the 2022 Plan for 188,000 shares of class B common stock, of which 5,000 shares vested and were issued on the date of grant and 5,000 will vest on July 12, 2024. In addition, 18,000 shares vest upon completion of tasks as outlined between the Company and grantee and an additional 160,000 shares will vest as the Company achieves certain sales targets in a twelve-month period. As of June 30, 2025, a total of 28,000 shares have vested under this award. The information presented in the following table represents the restricted stock awards, including performance-based awards, granted and outstanding during the period: Performance- Based Restricted Shares Service-Based Restricted Shares Weighted Average Grant Date Fair Value Beginning balance - - - Granted 235,000 1,448,000 3.10 Forfeited - ( 1,212,500 ) 3.10 Vested - ( 107,500 ) 3.10 Outstanding, unvested grants at June 30, 2024 235,000 128,000 $ 3.09 Granted 145,000 1,337,680 2.82 Forfeited - - - Vested - ( 1,089,658 ) 3.07 Outstanding, unvested grants at June 30, 2025 380,000 376,022 $ 2.01 Stock-based Compensation Stock options and warrants are granted at the fair market value of the underlying common stock on the date of grant. The Company recognizes compensation expense for these awards using the straight-line recognition method over the vesting period. The fair value of stock options and warrants was estimated at the date of grant using a Black-Scholes option-pricing model with the following weighted average assumptions for the years ended June 30, 2025 and 2024: June 30, 2025 June 30, 2024 Risk-free interest rate 4.14 % 5.10 % Dividend yield 0.0 % 0.0 % Expected volatility 44.42 % 47.44 % Expected life of awards 4.6 years 3.3 years Fair value of awards granted during the year $ 1.79 $ 0.90 The risk-free interest rate is based on U.S. government issues with a remaining term equal to the expected life of the awards. The determination of expected volatility is based on historical volatility of an appropriate industry sector index. The weighted average expected term was estimated for options using the average of the vesting term and contractual term of the awards. F- 25 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 Warrants Stock Options Weighted Average Remaining Life (years) Weighted Average Exercise Price Beginning balance 46,263 2,770,000 5.01 $ 0.59 Granted - 525,000 2.44 3.31 Granted 87,500 0.86 0.86 Cancelled ( 46,263 ) - 0.08 Forfeited - - - - Exercised - - - - Outstanding, June 30, 2024 ( 2,738,472 shares exercisable) 87,500 3,295,000 3.30 $ 4.17 Granted 790,509 - 4.76 1.54 Granted - 150,000 1.93 3.73 Cancelled - ( 124,205 ) 0.25 Forfeited - ( 461,875 ) 3.14 Exercised ( 331,657 ) ( 1,875,795 ) 0.40 Outstanding, June 30, 2025 ( 1,242,741 shares exercisable) 546,352 983,125 3.47 $ 2.71 The aggregate intrinsic value of the 1,242,741 shares exercisable at June 30, 2025 was $ 3,019,860 . The intrinsic value and total cash received of awards exercised for the year ended June 30, 2025 was $ 5,364,108 and $ 403,171 , respectively. The aggregate intrinsic value of the 2,738,472 shares exercisable at June 30, 2024 was $ 3,668,019 . No cash awards were exercised during the year ended June 30, 2024. Total stock compensation expense for the year ended June 30, 2025 was $ 3,203,230 . Total stock compensation expense for the year ended June 30, 2024 was $ 670,958 . In addition, $ 94,850 of warrants issued to representative of the underwriters in the initial public offering during the year ended June 30, 2024 were recorded as an offset to equity. As of June 30, 2025, total unrecognized stock compensation expense was $ 882,317 with the weighted average period over which it is expected to be recognized of 1.45 years. 14. Net Loss Per Share The following table sets forth the computation of basic and dilutive net income per share of class A and class B common stock: Year Ended June 30, 2025 2024 Basic and Diluted Net Loss Per Share Class A Class B Class A Class B Numerator Allocation of undistributed loss $ ( 180,510 ) $ ( 6,561,765 ) $ ( 171,420 ) $ ( 2,110,322 ) Denominator Weighted average number of shares used in per share computation 228,891 8,320,481 350,192 4,311,142 Basic and diluted net loss per share $ ( 0.79 ) $ ( 0.79 ) $ ( 0.49 ) $ ( 0.49 ) F- 26 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 15. Income Taxes The Company files income tax returns in the U.S. for federal and applicable foreign and state jurisdictions. Management is required to analyze all open tax years, as defined by the statute of limitations, for all major jurisdictions, which includes federal and certain states. The fiscal year ended June 30, 2023 was the entity’s initial year of existence, and is not subject to federal or state tax examinations prior to this period. The tax impact of the Irish subsidiary formation in the current tax year did not have a material impact on the Company’s tax provision. The One Big Beautiful Bill Act was not enacted until after the fiscal year end, therefore the effects are not included. The Company is still assessing what impact, if any, it will have, however given the fact the Company has a valuation allowance, management does not believe there will be a material impact. The Company’s provision for income taxes is comprised of the following components: Years Ended June 30, 2025 2024 Current Tax Expense (Benefit) Federal $ - $ - State - - Current Tax Expense (Benefit) $ - $ - Deferred Tax Expense (Benefit) Federal - - State - - Deferred Tax Expense (Benefit) - - Total Income Tax Expense (Benefit) $ - $ - The Company’s income tax expense from continuing operations for the year ended June 30, 2025 differed from the statutory federal rate of 21 % as follows: Pre-Tax Book Net Loss $ ( 6,742,275 ) Years Ended June 30, 2025 2024 Rate Reconciliation Amount Percent Amount Percent Federal tax (benefit) at a statutory rate $ ( 1,415,877 ) 21.00 % $ ( 479,166 ) 21.00 % State tax expense (benefit) ( 399,524 ) 5.93 % ( 125,968 ) 5.52 % Federal effect of State tax expense (benefit) 83,900 ( 1.24 )% - - Effect of rate change 72,965 (1.0 8 )% - - True-up of deferred taxes ( 208,366 ) 3.09 % - - Other permanent differences ( 512,813 ) 7.61 % 804 ( 0.04 )% Other items 459 ( 0.01 ) % - - Increase (decrease) in valuation allowance related to current period profit and loss activity 2,379,256 ( 35.29 )% 604,330 ( 26.49 )% Total tax expense $ - - $ - - F- 27 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 Deferred tax assets and liabilities consist of the following: Years Ended June 30, 2025 2024 Deferred Tax Assets Accrued expenses $ 76,058 $ 67,775 Equity compensation 291,281 1,186,561 Lease liabilities 106,233 145,913 NOL carryforwards 3,961,538 720,498 Valuation allowance ( 4,315,623 ) ( 1,936,367 ) Total Deferred Tax Assets $ 119,487 $ 184,379 Deferred Tax Liabilities Property and equipment $ 450 $ 24 Intangible assets 5,851 ( 31,881 ) Prepaid expenses ( 25,574 ) ( 13,288 ) ASC 842 right of use asset ( 100,214 ) ( 139,234 ) Valuation allowance - - Total Deferred Tax Liabilities $ ( 119,487 ) $ ( 184,379 ) Net Deferred Tax Asset (Liability) $ - $ - In assessing the realizability of deferred tax assets, management considers whether it is more-likely-than-not that some portion of the deferred tax asset will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. As of June 30, 2025, the Company recognized a full valuation allowance on its net deferred tax asset to reflect the fact it is not more-likely-than-not to realize any portion of the asset. Years Ended June 30, Other Items – All Gross 2025 2024 Federal NOL Carryovers $ 14,216,453 $ 2,715,784 State NOL Carryovers $ 14,216,453 $ 2,715,784 At June 30, 2025 and 2024, the Company had net operating loss carryforwards for Federal income tax purposes of $ 14,216,453 and $ 2,715,784 , respectively, which would be available to offset future federal taxable income, if any, and would not be subset to expiration. At June 30, 2025 and 2024, the Company has net operating loss carryforwards for state income tax purposes of $ 14,216,453 and $ 2,715,784 , which are available to offset future state taxable income, which is subject to expiration beginning in 2043. 16. Commitments and Contingencies Legal Proceedings From time to time, the Company may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties and an adverse result in these or other matters may arise from time to time that may harm our business. The Company is currently not aware of any such legal proceedings or claims that it believes will have a material adverse effect on its business, financial condition or operating results. Retirement Plans The Company does not maintain a defined contribution plan or any other type of retirement plan for its employees. Leases The Company has a non-cancellable operating lease commitment for its office facility expiring in 2028. Rent expense totaled $ 161,664 and $ 130,723 for the years ended June 30, 2025 and 2024, respectively. F- 28 CLEANCORE SOLUTIONS, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2025 AND 2024 The following table discloses the lease cost, discount rate, and remaining lease term for operating leases as of June 30, 2025 and 2024: June 30, 2025 June 30, 2024 Operating lease cost $ 161,664 $ 130,723 Remaining lease term 2.7 years 3.7 years Discount rate 6.56 % 6.56 % The discount rate was determined using the Company’s external debt and was adjusted for collateralization, term and lease amount. The following table discloses the undiscounted cash flows on an annual basis and a reconciliation of the undiscounted cash flows of operating lease liabilities recognized in the balance sheet as of June 30, 2025: Year Ended June 30, 2026 $ 167,226 2027 171,407 2028 116,160 2029 - 2030 - Total undiscounted cash flows 454,793 Less amount representing interest ( 36,689 ) Present value of lease liabilities 418,104 Less current portion ( 145,005 ) Noncurrent lease liabilities $ 273,099 Settlement Agreement On June 5, 2025, the Company entered into a settlement agreement with Boustead relating to certain compensation that Boustead asserted was owed to it under an engagement letter between the parties, dated September 21, 2022 and an underwriting agreement between the parties, dated April 25, 2024. Pursuant to the settlement agreement, the Company agreed, among other things, to pay Boustead $ 100,000 in cash within 45 days of signing of the settlement agreement and $ 1,050,000 in cash upon the closing of a financing, offering or other transaction to raise capital (such a transaction, a “Financing Transaction”) in an amount of at least $ 50 million; provided that if the Company consummates one or more Financing Transactions in an amount of less than $ 50 million, then the Company must pay Boustead no less than two percent ( 2 %) of the total amount of funds disbursed to the Company pursuant to each such Financing Transaction until Boustead receives a total of $ 1,050,000 in cash. In addition, upon closing of a Financing Transaction, the Company agreed to issue to Boustead a warrant for the purchase of 160,824 shares of class B common stock at an exercise price equal to the lower of (i) the price per share paid in such Financing Transaction or (ii) the exercise price of any warrants issued to the placement agent or financial advisor in connection with such Financing Transaction. The Company was also required to pay $ 100,000 in cash to Boustead within 45 days from the date of the agreement. 17. Subsequent Events The Company has evaluated events subsequent to June 30, 2025 to assess the need for potential recognition or disclosure. Such events were evaluated through August 22, 2025, the date the consolidated financial statements were available to be issued. The following were noted: On July 1, 2025, the Company issued an aggregate of 57,952 shares of class B common stock upon vesting of restricted stock unit awards granted under the 2022 Plan. On July 1, 2025, the Company granted a restricted stock award under the 2022 Plan for 30,000 shares of class B common stock, all of which vested in full on the date of grant. On July 21, 2025, the Company granted a restricted stock award under the 2022 Plan for 250,000 shares of class B common stock, of which 125,000 shares vested in full on the date of grant and the remaining 125,000 shares will vest quarterly for 5 quarters. On July 21, 2025, the Company granted a restricted stock unit award under the 2022 Plan for 100,000 shares of class B common stock, which will vest based on the Company’s achievement of certain revenue targets for the year ended June 30, 2025. On August 21, 2025, the Company granted a restricted stock award under the 2022 Plan for 725,000 shares of class B common stock, which vested in full on the date of grant. In July and August 2025, the Company issued an aggregate of 151,667 shares of class B common stock upon the exercise of warrants for gross proceeds of approximately $ 184,267 . F- 29 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Date: August 22, 2025 CLEANCORE SOLUTIONS, INC. /s/ Clayton Adams Name: Clayton Adams Title: Chief Executive Officer (Principal Executive Officer) /s/ David Enholm Name: David Enholm Title: Chief Financial Officer (Principal Financial and Accounting Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. SIGNATURE TITLE DATE /s/ Clayton Adams Chairman and Chief Executive Officer (principal executive officer) August 22, 2025 Clayton Adams /s/ David Enholm Chief Financial Officer (principal financial and accounting officer) August 22, 2025 David Enholm /s/ Brent Cox Director August 22, 2025 Brent Cox /s/ Peter Frei Director August 22, 2025 Peter Frei 39