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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
October 30, 2026
| Zoned Properties, Inc. |
| (Exact Name of Registrant as Specified in its Charter) |
| |
| Nevada |
| (State or Other Jurisdiction of Incorporation) |
| 000-51640 |
|
46-5198242 |
| (Commission File Number) |
|
(IRS Employer
Identification No.) |
8360 E. Raintree Drive, #230
Scottsdale, AZ |
|
85260 |
| (Address of Principal Executive Offices) |
|
(Zip Code) |
(Registrant’s telephone number, including
area code): (877) 360-8839
N/A
(Former name, former address and former fiscal
year, if changed since last report)
Check the appropriate box below if the Form 8-K
filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General
Instruction A.2.)
| ☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class |
|
Trading Symbol(s) |
|
Name of each exchange on which registered |
| N/A |
|
N/A |
|
N/A |
Indicate by check mark whether the registrant
is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities
Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by check
mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01. Entry into
a Material Definitive Agreement.
As previously reported
in the Current Report on Form 8-K filed by Zoned Properties, Inc. (the “Company”) on January 20, 2026 (the “Initial
Report”), on January 15, 2026, the Company entered into (i) a Material Event and Amendment Agreement (the “McLaren Material
Event Agreement”) with Bryan McLaren, the Company’s Chairman of the Board, Chief Executive Officer and Chief Financial Officer
(the “McLaren Material Event Agreement”), (ii) a Material Event Agreement (the “Blackwell Material Event Agreement”)
with Berekk Blackwell, and (iii) a Material Event Agreement (the “Moroney Material Event Agreement” and collectively with
the McLaren Material Event Agreement and the Blackwell Material Event Agreement, the “Material Event Agreements”). The closing
of the Asset Sale described in Item 2.01 below constitutes a “Material Event” under each of the Material Event Agreements.
In accordance with the terms of the Material Event Agreements, on October 30, 2026, the Company entered into a severance agreement with
each of Mr. McLaren, Mr. Blackwell and Mr. Moroney (each, a “Severance Agreement” and collectively, the “Severance Agreements”),
the forms of which were included as exhibits to the McLaren Material Event Agreement, the Blackwell Material Event Agreement and the Moroney
Material Event Agreement, respectively.
The material terms of
the Severance Agreements are described in Item 5.02 below and are incorporated into this Item 1.01 by reference.
The foregoing description
does not purport to be complete and is qualified in its entirety by the McLaren Material Event Agreement, filed as Exhibit 10.2 to the
Initial Report; the Blackwell Material Event Agreement, filed as Exhibit 10.3 to the Initial Report; the Moroney Material Event Agreement,
filed as Exhibit 10.4 to the Initial Report; and Mr. McLaren’s, Mr. Blackwell’s and Mr. Moroney’s executed Severance
Agreements, filed as Exhibits 10.4, 10.5 and 10.6, respectively, to this Current Report on Form 8-K, each of which is incorporated herein
by reference.
Pursuant to the terms
of the A&R APA (as hereinafter defined), at the closing of the Asset Sale (as hereinafter defined), on October 30, 2026, the Company
entered into a redemption agreement with each of Gregory Johnston (the “Johnston Redemption Agreement”) and McLaren Family
LLLP (the “McLaren Family LLLP Redemption Agreement” and together with the Johnston Redemption Agreement, the “Redemption
Agreements”), each of whom owns 1,000,000 shares of the Company’s preferred stock, and who together own 100% of the outstanding
shares of the Company’s preferred stock. Each share of the Company’s preferred stock has a liquidation preference of $1.00
per share and 50 votes per share. Dr. Alex McLaren, who is Mr. McLaren’s father, is the general partner of McLaren Family LLLP.
Pursuant to the terms of each of the Redemption Agreements, the Company agreed to redeem all shares held by Mr. Johnston and McLaren Family
LLLP, respectively, in exchange for a $1,000,000 cash payment to the respective preferred stock owner. Following the redemption, the 2,000,000
redeemed shares of preferred stock were returned to the status of authorized and unissued shares of preferred stock.
The foregoing description does not purport to be complete and is qualified
in its entirety by the Johnston Redemption Agreement and the McLaren Family LLLP Redemption Agreement, filed as Exhibits 10.7 and 10.8,
respectively, to this Current Report on Form 8-K, each of which is incorporated herein by reference.
Item 2.01. Completion
of Acquisition or Disposition of Assets.
On October 30, 2026,
the Company completed the previously announced sale of the Company’s business and substantially all of its assets (the “Asset
Sale”) to BPB Partners, LLC (the “Buyer”) pursuant to the Amended and Restated Asset Purchase Agreement, dated September
30, 2026 (the “A&R APA”), by and among the Company, Zoned Arizona Properties, LLC (“Zoned Arizona”), ZP RE
AZ Dysart, LLC (“Dysart”), ZP RE Holdings, LLC (“RE Holdings” and collectively with Zoned Arizona, Dysart, and
the Company, the “Seller Parties”) and the Buyer. The A&R APA amended and restated in its entirety the Asset Purchase
Agreement, dated January 15, 2026, by and among the same parties (the “Original APA”), which was described in the Initial
Report. The A&R APA was described in the Company’s Current Report on Form 8-K filed on October 1, 2026 (the “A&R APA
Report”).
The assets sold to the
Buyer in the Asset Sale included, among other things: (a) the Company’s 100% membership interests in RE Holdings; Zoned Arizona;
Dysart; ZP RE IL Ashland, LLC; ZP Data Platform 1, LLC; ZP Data Platform 2, LLC; Zoned Advisory Services, LLC; Zoned Properties Brokerage,
LLC; ZP Brokerage FL, LLC; and Chino Valley Properties, LLC (“Chino Valley LLC”); and (b) the Company’s 5% membership
interest in ZP Ohio B, LLC. Through those subsidiaries, the assets sold include substantially all of the Company’s real property
and operating assets, including the properties located at 410 S. Madison Drive, Tempe, Arizona; 13150 W. Bell Road, Surprise, Arizona;
and 3455 S. Ashland Avenue, Chicago, Illinois. Following the Asset Sale, the Company retained its 100% ownership interest in ZP RE AZ
Dunlap, LLC, which is a party to an active purchase and sale agreement with an escrow in place. As previously reported, on September 2,
2026, the Company completed the sale of the property located at 2144-2148 N. Road 1 East, Chino Valley, Arizona (the “Chino Property”),
through its subsidiary Chino Valley LLC, for a purchase price of $7,200,000, reduced from $8,000,000 as described in the Company’s
Current Report on Form 8-K filed on August 18, 2026. The Chino Property was not part of the assets sold in the Asset Sale.
The purchase price under
the A&R APA was $7,800,000, reduced by the indebtedness that the Buyer elected, in its sole discretion, to assume. The purchase price
was increased from the $7,000,000 stated in the Original APA by $800,000 to offset an $800,000 reduction in the sale price of the Chino
Property, so that the net consideration to the Company’s stockholders would remain the same. At closing, the Buyer assumed approximately
$7,941,163 of indebtedness, and the Company paid approximately $37,781 of transaction expenses. The Company paid into escrow net cash
of approximately $475,000 at closing.
The Buyer is owned by
Mr. McLaren, the Company’s Chairman of the Board, Chief Executive Officer and Chief Financial Officer; Mr. Blackwell, the Company’s
President and Chief Operating Officer; and Mr. Moroney, a non-officer employee of the Company. The Asset Sale is therefore a related-party
transaction. The Original APA, the A&R APA and the Asset Sale were reviewed, negotiated, and approved by a Special Transactions Committee
of the Company’s Board of Directors (the “Board”), consisting solely of the Company’s three independent directors.
On September 11, 2026, at a virtual special meeting (as reported in the Company’s Current Report on Form 8-K filed on September
15, 2026), the Company’s stockholders approved the Asset Sale and adopted the Original APA by (i) holders of a majority of the voting
power of the Company, as required by Nevada law, and (ii) holders of a majority of the voting power of the Company, excluding shares held
by any person who owns, controls or has an interest in the Buyer. On June 9, 2026, Marshall & Stevens Transaction Advisory Services
LLC delivered to the Special Transactions Committee its opinion that the purchase price is fair, from a financial point of view, to the
Company and to its stockholders other than Messrs. McLaren, Blackwell, and Moroney. Other than as described in this Current Report, there
is no material relationship between the Company or its affiliates and the Buyer, other than in respect of the A&R APA and the related
agreements.
The foregoing description
of the Asset Sale and the A&R APA does not purport to be complete and is qualified in its entirety by reference to the A&R APA,
a copy of which was filed as Exhibit 2.1 to the A&R APA Report and is incorporated herein by reference.
Item 3.03. Material
Modification to Rights of Security Holders.
Disclosure in Item 1.01
hereof regarding the Redemption Agreements is incorporated herein by reference.
Item 5.02. Departure
of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Effective upon the closing
of the Asset Sale on October 30, 2026, Mr. McLaren resigned as the Company’s Chief Executive Officer and Chief Financial Officer.
Immediately thereafter, the Company entered into an Independent Contractor Agreement (the “Independent Contractor Agreement”),
dated as of October 30, 2026, by and between the Company and Mr. McLaren, pursuant to which Mr. McLaren agreed to provide the Company
with general business advice and guidance and to serve as the Company’s Chief Executive Officer, Chief Financial Officer and President,
on a non-exclusive basis as an independent contractor, on a month-to-month basis until terminated in accordance with its terms. In exchange
for Mr. McLaren’s services, the Company agreed to pay Mr. McLaren $25,000 per month. Mr. McLaren continued to serve as the Company’s
Chairman of the Board following the closing of the Asset Sale.
Immediately after the
Company and Mr. McLaren entered into the Independent Contractor Agreement, Mr. Blackwell resigned as the Company’s President and
Chief Operating Officer and as a member of the Company’s Board. Mr. Moroney’s engagement with the Company ended on the same
date. Their resignations were not the result of any disagreement with the Company on any matter relating to the Company’s operations,
policies, or practices.
Accordingly, after the
closing of the Asset Sale, the Company’s directors and executive officers were as follows:
Directors:
Bryan McLaren
– Chairman of the Board
Art Friedman
– Independent Director
David G. Honaman
– Independent Director
Cole Stevens
– Independent Director
Executive
Officers:
Bryan McLaren
– Chief Executive Officer & Chief Financial Officer
As described in the Initial Report and in the
Company’s Current Report on Form 8-K filed on January 28, 2026 (the “January 28 Report”), the Company’s agreements
with its executive officers provide for cash payments, and for the end of forfeiture and clawback restrictions on previously issued restricted
stock, upon a “Material Event” or change of control, which includes the Asset Sale. As a result, following closing of the
Asset Sale, the forfeiture and clawback restrictions on restricted shares previously issued to Messrs. McLaren and Blackwell ended, and
the Company issued shares of common stock to Mr. McLaren and Mr. Blackwell, and made cash payments to Mr. McLaren and Mr. Blackwell, as
follows:
| Executive | |
No. of
Shares of
Common
Stock | | |
Cash (1) | | |
Cash (2) | |
| Bryan McLaren | |
| 250,000 | | |
$ | 275,000 | | |
$ | 36,750 | |
| Berekk Blackwell | |
| 150,000 | | |
$ | 210,000 | | |
$ | 22,050 | |
| (1) | Represents a cash payment equal to one year of the executive’s base salary. |
| (2) | Represents a cash payment equal to 35% of the fair market value of the shares of common stock received
by the executive. |
Mr. McLaren’s payments
arise under his Golden Parachute Agreement dated May 23, 2018, as amended by the Material Event and Amendment Agreement, and his Severance
Agreement, as described in Item 1.01 above. Mr. Blackwell’s payments arise under the Blackwell Material Event Agreement and his
Severance Agreement, described in Item 1.01 above. The Special Transactions Committee approved the payments, and the Company’s stockholders
approved the related compensation on an advisory basis on September 11, 2026.
The Board did not initially
contemplate providing any additional consideration for the services of the Special Committee members in connection with the Asset Sale.
However, negotiating and closing the Asset Sale required substantially more time, effort and active engagement by the Special Committee
than initially anticipated. In addition, the Board anticipates that the independent directors serving on the Special Committee will continue
to expend significant time and effort in connection with the subsequent winding down of the Company’s remaining operations, as well
as the evaluation, negotiation, and closing of a potential strategic transaction, merger, or business combination with a third party.
Accordingly, on October 30, 2026, the Board and the Special Committee approved cash payments, payable at the closing of the Asset Sale,
to the independent directors as follows:
| Independent Director | |
Cash | |
| Cole Stevens | |
$ | 70,000 | |
| Art Friedman | |
$ | 15,000 | |
| David G. Honaman | |
$ | 15,000 | |
The descriptions in this
Item 5.02 do not purport to be complete and are qualified in their entirety by reference to Mr. McLaren’s and Mr. Blackwell’s
Severance Agreements, filed as Exhibits 10.4 and 10.5, respectively, to this Current Report.
Item 8.01. Other Events
On October 30, 2026, the Company redeemed 2,000,000 shares of its preferred
stock, representing 100% of the outstanding shares of the Company’s preferred stock, pursuant to the terms of the Redemption Agreements,
as described in Item 1.01 hereof, in exchange for an aggregate cash payment of $2,000,000. Following the redemption, the 2,000,000 redeemed
shares of preferred stock were returned to the status of authorized and unissued shares of preferred stock.
As a result of the closing of the Asset Sale, the Company has divested
100% of its cannabis-related operations and assets, as contemplated by the A&R APA. As previously disclosed, the Company expects to
(i) pay its remaining indebtedness and settle its remaining accounts and agreements; (ii) distribute the net available cash to its stockholders
as a return of capital through a special dividend; and (iii) subsequently complete a reverse merger or other transaction involving the
public company. As of the date of this report, the Board has not declared a special dividend, and the amount and timing of any distribution
have not been determined. The Company cannot assure that it will pay a special dividend in any amount or that it will complete a reverse
merger or any other transaction.
The Company does not
expect that it will be a “shell company,” as defined in Rule 12b-2 under the Exchange Act, following the Asset Sale. Additionally,
the Company expects its common stock to remain quoted on the OTCQB.
Forward-Looking Statements
This Current Report on
Form 8-K contains forward-looking statements, including statements about the Company’s wind-down, the payment of any special dividend,
the redemption of its preferred stock and a possible reverse merger or other transaction. These statements are based on current expectations
and are subject to risks and uncertainties that could cause actual results to differ materially, including the amount of the Company’s
remaining liabilities and wind-down costs, the availability of cash for distribution under Nevada law, the Board’s discretion over
any distribution, and the Company’s ability to identify and complete a future transaction. The Company undertakes no obligation
to update these statements except as required by law.
Item 9.01 Financial Statements and Exhibits.
(b) Pro forma financial information
The unaudited pro forma condensed consolidated
financial information of the Company giving effect to the Asset Sale, as of June 30, 2026 and for the six months ended June 30, 2026 and
the year ended December 31, 2025, is filed as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.
(d) Exhibits
| Exhibit No. |
|
Description |
| 2.1* |
|
Amended and Restated Asset Purchase Agreement, dated September 30, 2026, by and among the registrant, Zoned Arizona Properties, LLC, ZP RE AZ Dysart, LLC, ZP RE Holdings, LLC, and BPB Partners, LLC (incorporated by reference to Exhibit 2.1 to the registrant’s Current Report on Form 8-K filed October 1, 2026). |
| 10.1 |
|
Material Event and Amendment Agreement, dated as of January 15, 2026, by and between Zoned Properties, Inc. and Bryan McLaren (incorporated by reference to Exhibit 10.2 to the registrant’s Current Report on Form 8-K filed January 20, 2026). |
| 10.2 |
|
Material Event Agreement, dated as of January 15, 2026, by and between Zoned Properties, Inc. and Berekk Blackwell (incorporated by reference to Exhibit 10.3 to the registrant’s Current Report on Form 8-K filed January 20, 2026). |
| 10.3 |
|
Material Event Agreement, dated as of January 15, 2026, by and between Zoned Properties, Inc. and Patrick Moroney (incorporated by reference to Exhibit 10.4 to the registrant’s Current Report on Form 8-K filed January 20, 2026). |
| 10.4 |
|
Severance Agreement between the registrant and Bryan McLaren, dated October 30, 2026. |
| 10.5 |
|
Severance Agreement between the registrant and Berekk Blackwell, dated October 30, 2026. |
| 10.6 |
|
Severance Agreement between the registrant and Patrick Moroney, dated October 30, 2026. |
| 10.7 |
|
Redemption Agreement between the registrant and Gregory Johnston, dated October 30, 2026. |
| 10.8 |
|
Redemption Agreement between the registrant and McLaren Family LLLP, dated October 30, 2026. |
| 99.1 |
|
Unaudited pro forma condensed consolidated financial information. |
| 104 |
|
Cover Page Interactive Data File (embedded within the Inline XBRL document). |
| * | Certain schedules and exhibits have been omitted pursuant to
Item 601(a)(5) of Regulation S-K. A copy of any omitted schedule or exhibit will be furnished supplementally to the SEC upon request. |
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| |
ZONED PROPERTIES, INC. |
| |
|
| Dated: October 30, 2026 |
/s/ Bryan McLaren |
| |
Bryan McLaren |
| |
Chief Executive Officer & Chief Financial Officer |
Exhibit 99.1
The following unaudited pro forma consolidated
financial information has been derived by the application of pro forma adjustments to the historical financial statements of the Zoned
Properties, Inc. and Subsidiaries (“Zoned Properties” or “Company”).
The unaudited pro forma consolidated financial
information is intended to provide you with information about how the following might have affected the Company’s historical financial
statements: (1) the sale of the rights, title, and interest in and to the Company’s assets of the Company’s wholly-owned subsidiary,
Chino Valley Properties, LLC (“Chino Valley”), which occurred on September 2, 2026, and (2) the sale of the rights, title,
and interest in and to the Company’s business, as described in the Company’s filings with the Securities and Exchange Commission
(the “SEC”), and the assets, properties and rights of the Company, Zoned Arizona Properties, LLC (“Zoned Arizona”),
ZP RE AZ Dysart, LLC (“Dysart”), ZP RE Holdings, LLC (“RE Holdings” and collectively with Zoned Arizona, Dysart
and the Company, the “Seller Parties”), other than the excluded assets (the “Assets”), which represents the sale
of substantially all of the assets of the Company pursuant to the terms of an Amended and Restated Asset Purchase Agreement, dated September
30, 2026 (the “A&R APA”), by and among the Seller Parties and BPB Partners, LLC (the “Buyer”). The Buyer is
owned by Bryan McLaren, the Company’s Chairman of the Board, Chief Executive Officer and Chief Financial Officer; Berekk Blackwell,
the Company’s President and Chief Operating Officer; and Patrick Moroney. The A&R APA amended and restated the Original APA
(as hereinafter defined) in its entirety.
The following unaudited pro forma consolidated
financial information has been prepared in accordance with Article 11 of Regulation S-X as amended by the final rule, Release No. 33-10786
“Amendments to Financial Disclosures about Acquired and Disposed Businesses.”
On January 15, 2026, the Company entered into
an Asset Purchase Agreement (the “Original APA”) by and among the Seller Parties and the Buyer. On September 30, 2026, the
parties entered into an Amended and Restated Asset Purchase Agreement (the “A&R APA”), which amends and restates the Original
APA in its entirety. Pursuant to the terms of the A&R APA, the Seller Parties agreed to sell to the Buyer, and the Buyer agreed to
purchase from the Seller Parties, subject to the terms of the A&R APA, all of the Seller Parties’ rights, title and interest
in and to the Company’s Business and certain Assets, which include, among other things (a) the Company’s 100% membership interests
in RE Holdings; Zoned Arizona; Dysart; ZP RE IL Ashland, LLC; ZP Data Platform 1, LLC; ZP Data Platform 2, LLC; Zoned Advisory Services,
LLC; Zoned Properties Brokerage, LLC; ZP Brokerage FL, LLC; and (b) the Company’s 5% membership interests in ZP Ohio B, LLC. Through
those subsidiaries, the assets sold include substantially all of the Company’s real property and operating assets, including the
properties located at 410 S. Madison Drive, Tempe, AZ; 13150 W. Bell Road, Surprise, AZ; and 3455 S. Ashland Avenue, Chicago, IL. Following
the Asset Sale, the Company retained its 100% ownership interest in ZP RE AZ Dunlap, LLC, which is a party to an active purchase and sale
agreement with an escrow in place. The Company’s 50% interest in Zoneomics Green, LLC is no longer included in the A&R APA,
as the entity has been dissolved.
On April 20, 2026, the Company through its wholly
owned subsidiaries, Green Valley Group, LLC, Kingman Property Group, LLC and Chino Valley Properties, LLC (“Chino Valley”
and collectively with Green Valley Group, LLC and Kingman Property Group, LLC, the “CKG Sellers”) entered into a Real Estate
Purchase and Sale Agreement (the “CKG Purchase Agreement”) with Broken Arrow Herbal Center, Inc. (“Broken Arrow”),
pursuant to which the Company agreed to sell three real estate assets located at 2144 N. Road 1 East, Chino Valley, AZ (the “Chino
Property”); 2095 Northern Avenue, Kingman, AZ (the “Kingman Property”); and 1732 W. Commerce Point Place, Green Valley,
AZ (the “Green Valley Property” and collectively with the Chino Property and the Kingman Property, the “CKG Properties”).
On April 22, 2026, Broken Arrow assigned all of its right, title and interest as purchased under the CKG Purchase Agreement with respect
to the Chino Property to 2148 Chino LLC (the “Chino Buyer”).
On May 1, 2026, the Company’s sale of the
real estate assets located at 23622-23634 Woodward Avenue, Pleasant Ridge, MI (the “Pleasant Ridge Assets”) closed.
On June 30, 2026, the Company’s sale of
the Green Valley Property and the Kingman Property closed, and Broken Arrow timely exercised its right under the CKG Purchase Agreement
to extend the closing date with respect to the Chino Property to August 31, 2026.
On August 12, 2026, Chino Valley and the Chino
Buyer entered into the First Amendment to Real Estate Purchase and Sale Agreement (the “First Amendment”), which amended the
CKG Purchase Agreement, and on September 2, 2026, Chino Valley and the Chino Buyer entered into the Second Amendment to Real Estate Purchase
and Sale Agreement, which amended the CKG Purchase Agreement, as amended by the First Amendment.
On September 2, 2026, the Company’s sale
of the Chino Property closed.
On October 30, 2026, the Asset Sale closed.
The unaudited pro forma consolidated financial
statements are presented for illustrative purposes only. The unaudited pro forma consolidated financial statements do not necessarily
reflect what the consolidated Company’s financial condition or results of operations would have been had the sale of the CKG Properties
and the Asset Sale, as applicable, occurred on the dates indicated. The actual financial position and results of operations may differ
significantly from the pro forma amounts reflected herein due to a variety of factors. The unaudited pro forma consolidated financial
statements also may not be useful in predicting the future financial condition and results of operations of the Company.
The unaudited pro forma consolidated financial
information reflects the assumptions, reclassifications and adjustments described in the accompanying notes to the unaudited pro forma
consolidated financial information.
The unaudited pro forma consolidated balance sheet
as of June 30, 2026 reflects the historical balance sheet of Zoned Properties and Subsidiaries as of June 30, 2026, on a pro forma basis
as if the sale of the Chino Property and the Asset Sale had been consummated on June 30, 2026. The unaudited pro forma consolidated statement
of operations for the year ended December 31, 2025 reflects the sale of the CKG Properties and the Asset Sale on a pro forma basis as
if the sale of the CKG Properties and the Asset Sale had been consummated on January 1, 2025, the beginning of the earliest period presented.
The unaudited pro forma consolidated statement of operations for the six months ended June 30, 2026, reflects the sale of the Chino Property
and the Asset Sale on a pro forma basis as if the sale of the Chino Property and the Asset Sale had been consummated on January 1, 2025,
the beginning of the earliest period presented.
The unaudited pro forma consolidated financial
information and accompanying notes have been derived from and should be read in conjunction with:
| ● | the historical audited financial statements of Zoned Properties as of December 31, 2025, and for
the year ended December 31, 2025, and the related notes, which are included in Zoned Properties’ Annual Report on Form 10-K
for the fiscal year ended December 31, 2025, as filed with the SEC on April 1, 2026 (the “Zoned Properties 2025 10-K”); |
| ● | the historical unaudited financial statements of Zoned Properties as of and for the six months ended June
30, 2026, and the related notes, which are included in Zoned Properties’ Quarterly Report on Form 10-Q for the period ended June
30, 2026, as filed with the SEC on August 14, 2026 (the “Zoned Properties June 2026 10-Q”); |
This information should be read together with
the consolidated financial statements and related notes, as applicable, of Zoned Properties included in the Zoned Properties 2025 10-K,
Zoned Properties’ “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and
other financial information included in the Zoned Properties 2025 10-K, the unaudited consolidated financial statements and related notes,
as applicable, of Zoned Properties included in the Zoned Properties June 2026 10-Q, and Zoned Properties’ “Management’s
Discussion and Analysis of Financial Condition and Results of Operations” and other financial information included in the Zoned
Properties June 2026 10-Q.
The unaudited pro forma adjustments are based
on information currently available, assumptions, and estimates underlying the pro forma adjustments and are described in the accompanying
notes. Actual results may differ materially from the assumptions used to present the accompanying unaudited pro forma consolidated financial
statements.
In summary, the historical consolidated financial
information has been adjusted to give the estimated effect to the following pro forma transactions as if the transactions had occurred
as of June 30, 2026 with respect to the unaudited pro forma consolidated balance sheet, and on January 1, 2025 with respect to the unaudited
pro forma consolidated statements of operations, the beginning of the earliest period presented.
| ● | The sale of the Chino Property, which closed
on September 2, 2026, and pursuant to which the Company received cash proceeds of approximately $7.1 million. (See Note 2 - Transaction
Accounting Adjustments – A). |
| ● | The Asset Sale, which closed on October 30, 2026,
and pursuant to which, the Buyer assumed approximately $7,941,163 of indebtedness, and the Company paid approximately $37,781 of transaction
expenses. The Company paid into escrow net cash of approximately $475,000 at closing. |
(See Note 2 - Transaction
Accounting Adjustments – B).
The unaudited pro forma consolidated financial
information does not reflect the cost of any post-closing activities or benefits that may result from any new activities. Therefore, the
unaudited pro forma consolidated financial information should not be considered indicative of actual results that would have been achieved
had the sale of the Chino Property and the Asset Sale occurred on the dates indicated and do not purport to indicate results of operations
for any future period.
ZONED PROPERTIES, INC. AND SUBSIDIARIES
PRO FORMA CONSOLIDATED BALANCE SHEETS
June 30, 2026
(Unaudited)
| | |
| | |
Pro Forma Adjustments | | |
| |
| | |
June 30, | | |
Sale of
Chino
Property | | |
A&R APA | | |
Pro Forma
June 30, | |
| | |
2026 | | |
Debit (Credit) | | |
Debit (Credit) | | |
2026 | |
| | |
| | |
(A) | | |
(C) | | |
| |
| ASSETS | |
| | |
| | |
| | |
| |
| Cash | |
$ | 2,446,418 | | |
$ | 7,106,253 | | |
$ | - | | |
$ | 9,552,671 | |
| Accounts receivable | |
| 126,749 | | |
| - | | |
| (126,749 | ) | |
| - | |
| Deferred rent | |
| 1,059,523 | | |
| (398,471 | ) | |
| (661,052 | ) | |
| - | |
| Lease incentive receivable | |
| 380,734 | | |
| (380,734 | ) | |
| - | | |
| - | |
| Rental properties, net | |
| 7,711,219 | | |
| (1,673,607 | ) | |
| (6,037,612 | ) | |
| - | |
| Prepaid expenses and other assets | |
| 540,512 | | |
| - | | |
| - | | |
| 540,512 | |
| Escrow deposits | |
| 1,100,320 | | |
| - | | |
| (106,269 | ) | |
| 994,051 | |
| Property and equipment, net | |
| 4,400 | | |
| - | | |
| - | | |
| 4,400 | |
| Operating lease right of use asset, net | |
| 18,180 | | |
| - | | |
| - | | |
| 18,180 | |
| Investment in cost-method investees | |
| 84,110 | | |
| - | | |
| (84,110 | ) | |
| - | |
| Interest rate swap asset | |
| 1,927 | | |
| | | |
| (1,927 | ) | |
| - | |
| Security deposits | |
| 2,272 | | |
| - | | |
| - | | |
| 2,272 | |
| | |
| | | |
| | | |
| | | |
| | |
| Total Assets | |
$ | 13,476,364 | | |
$ | 4,653,441 | | |
$ | (7,017,719 | ) | |
$ | 11,112,086 | |
| | |
| | | |
| | | |
| | | |
| | |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |
| | | |
| | | |
| | | |
| | |
| LIABILITIES: | |
| | | |
| | | |
| | | |
| | |
| Convertible debenture | |
$ | 2,000,000 | | |
$ | - | | |
$ | (2,000,000 | ) | |
$ | - | |
| Notes payable, net | |
| 5,813,005 | | |
| - | | |
| (5,813,005 | ) | |
| - | |
| Accounts payable | |
| 146,321 | | |
| - | | |
| (118,488 | ) | |
| 27,833 | |
| Accrued expenses | |
| 528,749 | | |
| (26,303 | ) | |
| (226,819 | ) | |
| 275,627 | |
| Lease liability | |
| 18,455 | | |
| - | | |
| - | | |
| 18,455 | |
| Contract liabilities | |
| 1,222,482 | | |
| (928,812 | ) | |
| (293,670 | ) | |
| - | |
| Security deposits payable | |
| 316,704 | | |
| (70,000 | ) | |
| (246,704 | ) | |
| - | |
| | |
| | | |
| | | |
| | | |
| | |
| Total Liabilities | |
| 10,045,716 | | |
| (1,025,115 | ) | |
| (8,698,686 | ) | |
| 321,915 | |
| | |
| | | |
| | | |
| | | |
| | |
| Commitments and Contingencies | |
| | | |
| | | |
| | | |
| | |
| | |
| | | |
| | | |
| | | |
| | |
| STOCKHOLDERS’ EQUITY: | |
| | | |
| | | |
| | | |
| | |
| Preferred stock, $0.001 par value, 5,000,000 shares authorized; 2,000,000
shares issued and outstanding on June 30, 2026 and December 31, 2025 ($1.00 per share liquidation preference or $2,000,000) | |
| 2,000 | | |
| - | | |
| - | | |
| 2,000 | |
| Common stock: $0.001 par value, 100,000,000 shares
authorized; 13,351,516 and 12,201,516 shares issued on June 30, 2026 and December 31, 2025, respectively, and 13,180,829 and
12,030,829 shares outstanding on June 30, 2026 and December 31, 2025, respectively | |
| 13,352 | | |
| - | | |
| - | | |
| 13,352 | |
| Additional paid-in capital | |
| 21,939,974 | | |
| - | | |
| - | | |
| 21,939,974 | |
| Treasury stock, at cost (170,687 and 170,687 shares on June 30, 2026 and December 31, 2025, respectively) | |
| (49,868 | ) | |
| - | | |
| - | | |
| (49,868 | ) |
| Accumulated deficit | |
| (18,474,810 | ) | |
| 5,678,556 | | |
| 1,680,967 | | |
| (11,115,287 | ) |
| | |
| | | |
| | | |
| | | |
| | |
| Total Stockholders’ Equity | |
| 3,430,648 | | |
| 5,678,556 | | |
| 1,680,967 | | |
| 10,790,171 | |
| | |
| | | |
| | | |
| | | |
| | |
| Total Liabilities and Stockholders’ Equity | |
$ | 13,476,364 | | |
$ | 4,653,441 | | |
$ | (7,017,719 | ) | |
$ | 11,112,086 | |
See accompanying notes to unaudited pro
forma consolidated financial statements.
ZONED PROPERTIES, INC. AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENT OF
OPERATIONS
For the Six Months Ended June 30,
2026
(Unaudited)
| | |
| | |
Pro Forma Adjustments | | |
Pro Forma | |
| | |
Six | | |
| | |
| | |
| | |
Six | |
| | |
Months
Ended | | |
Sale of
CKG | | |
Sale of
Pleasant
| | |
| | |
Months
Ended | |
| | |
June 30, | | |
Properties | | |
Ridge Assets | | |
A&R APA | | |
June 30, | |
| | |
2026 | | |
Debit (Credit) | | |
Debit (Credit) | | |
Debit (Credit) | | |
2026 | |
| | |
| | |
| | |
| | |
| | |
| |
| REVENUES: | |
| | |
| | |
| | |
| | |
| |
| Property investment portfolio revenues | |
$ | 1,412,100 | | |
$ | (568,301 | ) | |
$ | (196,995 | ) | |
| (646,804 | ) | |
$ | - | |
| Real estate services revenues | |
| 534,313 | | |
| - | | |
| - | | |
| (534,313 | ) | |
| - | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Total revenues | |
| 1,946,413 | | |
| (568,301 | ) | |
| (196,995 | ) | |
| (1,181,117 | ) | |
| - | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| OPERATING EXPENSES: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Compensation and benefits | |
| 435,574 | | |
| - | | |
| - | | |
| - | | |
| 435,574 | |
| Professional fees | |
| 430,075 | | |
| (1,000 | ) | |
| (13,500 | ) | |
| (15,248 | ) | |
| 400,327 | |
| Brokerage fees | |
| 432,703 | | |
| - | | |
| - | | |
| (432,703 | ) | |
| - | |
| General and administrative expenses | |
| 144,124 | | |
| (36 | ) | |
| (106 | ) | |
| 12,635 | | |
| 156,617 | |
| Depreciation and amortization | |
| 148,462 | | |
| (76,720 | ) | |
| (11,878 | ) | |
| (58,469 | ) | |
| 1,395 | |
| Real estate taxes | |
| 70,493 | | |
| (31,001 | ) | |
| (14,136 | ) | |
| (25,356 | ) | |
| - | |
| Property portfolio business development costs | |
| 204,650 | | |
| - | | |
| - | | |
| (204,650 | ) | |
| - | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Total operating expenses, net | |
| 1,866,081 | | |
| (108,757 | ) | |
| (39,620 | ) | |
| (723,791 | ) | |
| 993,913 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| INCOME (LOSS) FROM OPERATIONS | |
| 80,332 | | |
| (459,544 | ) | |
| (157,375 | ) | |
| (457,326 | ) | |
| (993,913 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| OTHER (EXPENSES) INCOME: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Interest (expenses) income | |
| (382,775 | ) | |
| - | | |
| 37,637 | | |
| 342,116 | | |
| (3,022 | ) |
| Other income (expenses) | |
| 4,500 | | |
| - | | |
| - | | |
| (4,500 | ) | |
| - | |
| Gain from sale of rental properties, net | |
| 237,815 | | |
| (340,701 | ) | |
| 102,886 | | |
| - | | |
| - | |
| Income (loss) from derivative - interest rate swap | |
| 79,255 | | |
| - | | |
| - | | |
| (79,255 | ) | |
| - | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Total other (expenses) income, net | |
| (61,205 | ) | |
| (340,701 | ) | |
| 140,523 | | |
| 258,361 | | |
| (3,022 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| NET INCOME (LOSS) | |
$ | 19,127 | | |
$ | (800,245 | ) | |
$ | (16,852 | ) | |
$ | (198,965 | ) | |
$ | (996,935 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| NET INCOME (LOSS) PER COMMON SHARE: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Basic | |
$ | 0.00 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | (0.08 | ) |
| Diluted | |
$ | 0.00 | | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | (0.07 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Basic | |
| 13,002,928 | | |
| - | | |
| - | | |
| - | | |
| 13,002,928 | |
| Diluted | |
| 13,402,928 | | |
| - | | |
| - | | |
| - | | |
| 13,402,928 | |
See accompanying notes to unaudited pro forma consolidated financial
statements.
ZONED PROPERTIES, INC. AND SUBSIDIARIES
PRO FORMA CONSOLIDATED BALANCE SHEETS
December 31, 2025
| | |
| | |
Pro Forma Transaction Accouting Adjustments | | |
| |
| | |
December 31, | | |
Sale of
CKG
Properties | | |
Sale of
Pleasant
Ridge Assets | | |
A&R APA | | |
Pro Forma
December 31, | |
| | |
2025 | | |
Debit (Credit) | | |
Debit (Credit) | | |
Debit (Credit) | | |
2025 | |
| | |
(Audited) | | |
(A) | | |
(B) | | |
(C) | | |
| |
| ASSETS | |
| | |
| | |
| | |
| | |
| |
| Cash | |
$ | 837,767 | | |
$ | 4,000,000 | | |
$ | 600,000 | | |
$ | 4,174,883 | | |
$ | 9,612,650 | |
| Accounts receivable | |
| 452,874 | | |
| (389,984 | ) | |
| - | | |
| (62,890 | ) | |
| - | |
| Note receivable | |
| - | | |
| 5,000,000 | | |
| - | | |
| (5,000,000 | ) | |
| - | |
| Deferred rent | |
| 1,084,413 | | |
| (58,005 | ) | |
| (404,189 | ) | |
| (622,219 | ) | |
| - | |
| Lease incentive receivable | |
| 394,495 | | |
| (394,495 | ) | |
| - | | |
| - | | |
| - | |
| Rental properties, net | |
| 10,490,786 | | |
| (2,420,702 | ) | |
| (1,974,003 | ) | |
| (6,096,081 | ) | |
| - | |
| Prepaid expenses and other assets | |
| 192,441 | | |
| - | | |
| - | | |
| - | | |
| 192,441 | |
| Escrow deposits | |
| 294,169 | | |
| - | | |
| - | | |
| (294,169 | ) | |
| - | |
| Capitalized project costs | |
| 54,248 | | |
| - | | |
| - | | |
| (54,248 | ) | |
| - | |
| Property and equipment, net | |
| 5,795 | | |
| - | | |
| - | | |
| - | | |
| 5,795 | |
| Operating lease right of use asset, net | |
| 39,106 | | |
| - | | |
| - | | |
| - | | |
| 39,106 | |
| Investment in cost-method investees | |
| 84,110 | | |
| - | | |
| - | | |
| (84,110 | ) | |
| - | |
| Security deposits | |
| 2,272 | | |
| - | | |
| - | | |
| - | | |
| 2,272 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Total Assets | |
$ | 13,932,476 | | |
$ | 5,736,814 | | |
$ | (1,778,192 | ) | |
$ | (8,038,834 | ) | |
$ | 9,852,264 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |
| | | |
| | | |
| | | |
| | | |
| | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| LIABILITIES: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Convertible note payable | |
$ | 2,000,000 | | |
$ | - | | |
$ | - | | |
$ | (2,000,000 | ) | |
$ | - | |
| Notes payable, net | |
| 7,540,127 | | |
| - | | |
| (1,715,010 | ) | |
| (5,825,117 | ) | |
| - | |
| Accounts payable | |
| 130,241 | | |
| - | | |
| - | | |
| (103,714 | ) | |
| 26,527 | |
| Accrued expenses | |
| 435,690 | | |
| (31,126 | ) | |
| (18,898 | ) | |
| (206,717 | ) | |
| 178,949 | |
| Lease liability | |
| 39,711 | | |
| - | | |
| - | | |
| - | | |
| 39,711 | |
| Contract liabilities | |
| 302,282 | | |
| - | | |
| - | | |
| (302,282 | ) | |
| - | |
| Derivative liability - interest rate swap, at fair value | |
| 77,328 | | |
| - | | |
| - | | |
| (77,328 | ) | |
| - | |
| Security deposits payable | |
| 339,471 | | |
| (51,667 | ) | |
| (41,100 | ) | |
| (246,704 | ) | |
| - | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Total Liabilities | |
| 10,864,850 | | |
| (82,793 | ) | |
| (1,775,008 | ) | |
| (8,761,862 | ) | |
| 245,187 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Commitments and Contingencies | |
| | | |
| | | |
| | | |
| | | |
| | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| STOCKHOLDERS’ EQUITY: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Preferred stock, $0.001 par value, 5,000,000 shares authorized; 2,000,000 shares issued and outstanding on December 31, 2025 and 2024 ($1.00 per share liquidation preference or $2,000,000) | |
| 2,000 | | |
| | | |
| | | |
| | | |
| 2,000 | |
| Common stock: $0.001 par value, 100,000,000 shares authorized; 12,201,516 and 12,201,516 shares issued on December 31, 2025 and 2024 respectively, and 12,030,829 and 12,087,829 shares outstanding on December 31, 2025 and 2024, respectively | |
| 12,202 | | |
| | | |
| | | |
| | | |
| 12,202 | |
| Additional paid-in capital | |
| 21,597,229 | | |
| | | |
| | | |
| | | |
| 21,597,229 | |
| Treasury stock, at cost (170,687 and 113,687 shares on December 31, 2025 and 2024, respectively) | |
| (49,868 | ) | |
| | | |
| | | |
| | | |
| (49,868 | ) |
| Accumulated deficit | |
| (18,493,937 | ) | |
| 5,819,607 | | |
| (3,184 | ) | |
| 723,028 | | |
| (11,954,486 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Total Stockholders’ Equity | |
| 3,067,626 | | |
| 5,819,607 | | |
| (3,184 | ) | |
| 723,028 | | |
| 9,607,077 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Total Liabilities and Stockholders’ Equity | |
$ | 13,932,476 | | |
$ | 5,736,814 | | |
$ | (1,778,192 | ) | |
$ | (8,038,834 | ) | |
$ | 9,852,264 | |
See accompanying notes to pro forma consolidated financial statements.
ZONED PROPERTIES, INC. AND SUBSIDIARIES
PRO FORMA CONSOLIDATED STATEMENTS
OF OPERATIONS
For the Year Ended December
31, 2025
| | |
| | |
Pro Forma Transaction Accounting Adjustments | | |
Pro Forma | |
| | |
For the Year
Ended
December 31, | | |
Sale of
CKG
Properties | | |
Sale of
Pleasant
Ridge
Assets | | |
A&R APA | | |
For the Year
Ended
December 31, | |
| | |
2025 | | |
Debit (Credit) | | |
Debit (Credit) | | |
Debit (Credit) | | |
2025 | |
| | |
(Audited) | | |
(C) | | |
(D) | | |
(E) | | |
| |
| REVENUES: | |
| | |
| | |
| | |
| | |
| |
| Property investment portfolio revenues | |
$ | 3,080,654 | | |
$ | (1,212,841 | ) | |
$ | (573,203 | ) | |
$ | (1,294,610 | ) | |
$ | - | |
| Real estate services revenues | |
| 1,059,804 | | |
| - | | |
| - | | |
| (1,059,804 | ) | |
| - | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Total revenues | |
| 4,140,458 | | |
| (1,212,841 | ) | |
| (573,203 | ) | |
| (2,354,414 | ) | |
| - | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| OPERATING INCOME (EXPENSES): | |
| | | |
| | | |
| | | |
| | | |
| | |
| Compensation and benefits | |
| 1,398,498 | | |
| - | | |
| - | | |
| (1,032,818 | ) | |
| 365,680 | |
| Professional fees | |
| 252,636 | | |
| (1,340 | ) | |
| - | | |
| (8,862 | ) | |
| 242,434 | |
| Brokerage fees | |
| 131,236 | | |
| - | | |
| - | | |
| (131,236 | ) | |
| - | |
| General and administrative expenses | |
| 308,149 | | |
| (53 | ) | |
| (251 | ) | |
| (139,412 | ) | |
| 168,433 | |
| Depreciation and amortization | |
| 360,903 | | |
| (154,719 | ) | |
| (76,017 | ) | |
| (127,378 | ) | |
| 2,789 | |
| Real estate taxes | |
| 155,322 | | |
| (62,201 | ) | |
| (42,409 | ) | |
| (50,712 | ) | |
| - | |
| Property portfolio business development costs | |
| 300,540 | | |
| - | | |
| - | | |
| (300,540 | ) | |
| - | |
| Impairment loss from rental properties | |
| 3,118,716 | | |
| - | | |
| (2,100,000 | ) | |
| (1,018,716 | ) | |
| - | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Total operating income (expenses), net | |
| 6,026,000 | | |
| (218,313 | ) | |
| (2,218,677 | ) | |
| (2,809,674 | ) | |
| 779,336 | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| (LOSS) INCOME FROM OPERATIONS | |
| (1,885,542 | ) | |
| (994,528 | ) | |
| 1,645,474 | | |
| 455,260 | | |
| (779,336 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| OTHER (EXPENSES) INCOME: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Interest (expenses) income | |
| (797,112 | ) | |
| - | | |
| 149,254 | | |
| 647,902 | | |
| 44 | |
| Other income | |
| 3,500 | | |
| - | | |
| - | | |
| (3,500 | ) | |
| - | |
| Impairment of equity securities | |
| (50,000 | ) | |
| - | | |
| - | | |
| - | | |
| (50,000 | ) |
| (Loss) income from derivative - interest rate swap | |
| (121,909 | ) | |
| - | | |
| - | | |
| 121,909 | | |
| - | |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Total other (expenses) income, net | |
| (965,521 | ) | |
| - | | |
| 149,254 | | |
| 766,311 | | |
| (49,956 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| (LOSS) INCOME BEFORE EQUITY METHOD LOSSES | |
| (2,851,063 | ) | |
| (994,528 | ) | |
| 1,794,728 | | |
| 1,221,571 | | |
| (829,292 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| EQUITY METHOD LOSS: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Equity method loss from unconsolidated joint ventures | |
| (3,352 | ) | |
| - | | |
| - | | |
| - | | |
| (3,352 | ) |
| Total equity method loss | |
| (3,352 | ) | |
| - | | |
| - | | |
| - | | |
| (3,352 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| NET (LOSS) INCOME | |
$ | (2,854,415 | ) | |
$ | (994,528 | ) | |
$ | 1,794,728 | | |
$ | 1,221,571 | | |
$ | (832,644 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| NET (LOSS) INCOME PER COMMON SHARE: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Basic | |
$ | (0.24 | ) | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | (0.07 | ) |
| Diluted | |
$ | (0.24 | ) | |
$ | - | | |
$ | - | | |
$ | - | | |
$ | (0.07 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | |
| | | |
| | | |
| | | |
| | | |
| | |
| Basic | |
| 12,053,715 | | |
| - | | |
| - | | |
| - | | |
| 12,053,715 | |
| Diluted | |
| 12,053,715 | | |
| - | | |
| - | | |
| - | | |
| 12,053,715 | |
See accompanying notes to pro forma consolidated financial statements.
ZONED PROPERTIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED PRO
FORMA CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - BASIS OF PRESENTATION
On January 15, 2026, Zoned Properties, Inc. (“Zoned
Properties” or the “Company”) entered into an Asset Purchase Agreement (the “Original APA”) by and among
the Company, Zoned Arizona Properties, LLC (“Zoned Arizona”), ZP RE AZ Dysart, LLC (“Dysart”), ZP RE Holdings,
LLC (“RE Holdings” and collectively with Zoned Arizona, Dysart and the Company, the “Seller Parties”) and BPB
Partners, LLC (the “Buyer”). On September 30, 2026, the parties entered into an Amended and Restated Asset Purchase Agreement
(the “A&R APA”), which amends and restates the Original APA in its entirety. Pursuant to the terms of the A&R APA,
the Seller Parties agreed to sell to the Buyer, and the Buyer agreed to purchase from the Seller Parties, subject to the terms of the
A&R APA, all of the Seller Parties’ rights, title and interest in and to the Company’s business, as described in the Company’s
filings (the “Business”) with the Securities and Exchange Commission (the “SEC”), and the assets, properties and
rights of the Seller Parties, other than the excluded assets (the “Assets”), which include, among other things (a) the Company’s
100% membership interests in RE Holdings; Zoned Arizona; Dysart; ZP RE IL Ashland, LLC; ZP Data Platform 1, LLC; ZP Data Platform 2, LLC;
Zoned Advisory Services, LLC; Zoned Properties Brokerage, LLC; ZP Brokerage FL, LLC; and (b) the Company’s 5% membership interests
in ZP Ohio B, LLC. Through those subsidiaries, the assets sold include substantially all of the Company’s real property and operating
assets, including the properties located at 410 S. Madison Drive, Tempe, AZ; 13150 W. Bell Road, Surprise, AZ; and 3455 S. Ashland Avenue,
Chicago, IL. Following the Asset Sale, the Company retained its 100% ownership interest in ZP RE AZ Dunlap, LLC, which is a party to an
active purchase and sale agreement with an escrow in place. The Company’s 50% interest in Zoneomics Green, LLC is no longer included
in the A&R APA, as the entity has been dissolved.
On April 20, 2026, the Company through its wholly
owned subsidiaries, Green Valley Group, LLC, Kingman Property Group, LLC and Chino Valley Properties, LLC (“Chino Valley”
and collectively with Green Valley Group, LLC and Kingman Property Group, LLC, the “CKG Sellers”) entered into a Real Estate
Purchase and Sale Agreement (the “CKG Purchase Agreement”) with Broken Arrow Herbal Center, Inc. (“Broken Arrow”),
pursuant to which the Company agreed to sell three real estate assets located at 2144 N. Road 1 East, Chino Valley, AZ (the “Chino
Property”); 2095 Northern Avenue, Kingman, AZ (the “Kingman Property”); and 1732 W. Commerce Point Place, Green Valley,
AZ (the “Green Valley Property” and collectively with the Chino Property and the Kingman Property, the “CKG Properties”).
On April 22, 2026, Broken Arrow assigned all of its right, title and interest as purchased under the CKG Purchase Agreement with respect
to the Chino Property to 2148 Chino LLC (the “Chino Buyer”).
On May 1, 2026, the Company’s sale of the
real estate assets located at 23622-23634 Woodward Avenue, Pleasant Ridge, MI (the “Pleasant Ridge Assets”) closed.
On June 30, 2026, the Company’s sale of
the Green Valley Property and the Kingman Property closed, and Broken Arrow timely exercised its right under the CKG Purchase Agreement
to extend the closing date with respect to the Chino Property to August 31, 2026.
On August 12, 2026, Chino Valley and the Chino
Buyer entered into the First Amendment to Real Estate Purchase and Sale Agreement (the “First Amendment”), which amended the
CKG Purchase Agreement, and on September 2, 2026, Chino Valley and the Chino Buyer entered into the Second Amendment to Real Estate Purchase
and Sale Agreement, which amended the CKG Purchase Agreement, as amended by the First Amendment.
On September 2, 2026, the Company’s sale
of the Chino Property closed.
On October 30, 2026, the Asset Sale closed.
The unaudited pro forma consolidated balance sheet
as of June 30, 2026 reflects the historical balance sheet of Zoned Properties and Subsidiaries as of June 30, 2026, on a pro forma basis
as if the sale of the Chino Property and the Asset Sale had been consummated on June 30, 2026. The unaudited pro forma consolidated statement
of operations for the year ended December 31, 2025 reflects the sale of the CKG Properties and the Asset Sale on a pro forma basis as
if the sale of the CKG Properties and the Asset Sale had been consummated on January 1, 2025, the beginning of the earliest period presented.
The unaudited pro forma consolidated statement of operations for the six months ended June 30, 2026, reflects the sale of the Chino Property
and the Asset Sale on a pro forma basis as if the sale of the Chino Property and the Asset Sale had been consummated on January 1, 2025,
the beginning of the earliest period presented.
The pro forma adjustments reflecting closing of
the sale of the CKG Properties and closing of the Asset Sale and the related transactions are based on certain currently available information
and certain assumptions and methodologies that the Company’s management believes are reasonable under the circumstances. The unaudited
consolidated pro forma adjustments, which are described in the accompanying notes, may be revised as additional information becomes available
and is evaluated. Therefore, it is likely that the actual adjustments will differ from the pro forma adjustments, and it is possible that
the difference may be material. The Company’s management believes that its assumptions and methodologies provide a reasonable basis
for presenting all of the significant effects of the sale of the CKG Properties and the Asset Sale and the related transactions based
on information available to management at this time and that the pro forma adjustments give appropriate effect to those assumptions and
are properly applied in the unaudited pro forma consolidated financial information.
ZONED PROPERTIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED PRO
FORMA CONSOLIDATED FINANCIAL STATEMENTS
NOTE 2 - ADJUSTMENTS TO UNAUDITED PRO FORMA
CONSOLIDATED FINANCIAL INFORMATION
The unaudited pro forma consolidated financial
information has been prepared to illustrate the effect of the sale of the Chino Property and the Asset Sale, and related transactions,
and has been prepared for informational purposes only.
The following unaudited pro forma consolidated
financial information has been prepared in accordance with Article 11 of Regulation S-X, as amended by the final rule, Release No. 33-10786
“Amendments to Financial Disclosures about Acquired and Disposed Businesses.” Release No. 33-10786 replaces the existing pro
forma adjustment criteria with simplified requirements to depict the accounting for the transaction (“Transaction Accounting Adjustments”)
and present the reasonably estimable transaction effects that have occurred or are reasonably expected to occur.
The accompanying unaudited pro forma consolidated
financial statements are based on the historical financial statements of Zoned Properties and Subsidiaries, after giving effect to:
Transaction Accounting Adjustment –
A
On April 20, 2026, the Company through the CKG
Sellers entered into the CKG Purchase Agreement with Broken Arrow, pursuant to which the Company agreed to sell the CKG Properties. On
April 22, 2026, Broken Arrow assigned all of its right, title and interest as purchased under the CKG Purchase Agreement with respect
to the Chino Property to the Chino Buyer.
On May 1, 2026, the Company’s sale of the
Pleasant Ridge Assets closed.
On June 30, 2026, the Company’s sale of
the Green Valley Property and the Kingman Property closed, and Broken Arrow timely exercised its right under the CKG Purchase Agreement
to extend the closing date with respect to the Chino Property to August 31, 2026.
On August 12, 2026, Chino Valley and the Chino
Buyer entered into the First Amendment, which amended the CKG Purchase Agreement, and on September 2, 2026, Chino Valley and the Chino
Buyer entered into the Second Amendment to Real Estate Purchase and Sale Agreement, which amended the CKG Purchase Agreement, as amended
by the First Amendment.
On September 2, 2026, the Company’s sale
of the Chino Property closed.
Transaction Accounting Adjustment A reflects the
sale of the Chino Property for approximately $7,100,000 in cash, and the removal of all related assets consisting of the Chino Property,
net, deferred rent receivable, lease incentive receivables, deferred costs, and accounts receivable, and the removal of related liabilities
such as accounts payable and accrued expenses, and security deposits payable.
Transaction Accounting Adjustment –
B
On September 30, 2026, the parties entered into
the A&R APA. Pursuant to the terms of the A&R APA, the Seller Parties agreed to sell to the Buyer, and the Buyer agreed to purchase
from the Seller Parties, subject to the terms of the A&R APA, all of the Seller Parties’ rights, title and interest in and to
the Company’s Business and certain Assets, which include, among other things (a) the Company’s 100% membership interests in
RE Holdings; Zoned Arizona; Dysart; ZP RE IL Ashland, LLC; ZP Data Platform 1, LLC; ZP Data Platform 2, LLC; Zoned Advisory Services,
LLC; Zoned Properties Brokerage, LLC; ZP Brokerage FL, LLC; and (b) the Company’s 5% membership interests in ZP Ohio B, LLC. Through
those subsidiaries, the assets sold include substantially all of the Company’s real property and operating assets, including the
properties located at 410 S. Madison Drive, Tempe, AZ; 13150 W. Bell Road, Surprise, AZ; and 3455 S. Ashland Avenue, Chicago, IL. Following
the Asset Sale, the Company retained its 100% ownership interest in ZP RE AZ Dunlap, LLC, which is a party to an active purchase and sale
agreement with an escrow in place. The Company’s 50% interest in Zoneomics Green, LLC is no longer included in the A&R APA,
as the entity has been dissolved.
Pursuant to the terms of the A&R APA, the
purchase price was $7,800,000, reduced by the indebtedness the Buyer elects, in its sole discretion, to assume. The Company must repay
all other indebtedness and fund its own transaction expenses at closing. If the assumed indebtedness exceeds $7,800,000, the Company must
pay the difference to the Buyer at closing.
On October 30, 2026, the Asset Sale closed. Upon
closing of the Asset Sale pursuant to the terms of the A&R APA, the Buyer assumed all remaining debt, the Company settled any remaining
liabilities and agreements, the Company redeemed its outstanding preferred shares. The Company expects to distribute a certain amount
of net available balance of cash to stockholders as a return of capital through a special dividend, to continue its non-cannabis related
real estate service business, and to complete a reverse merger or other transaction involving the public company.
ZONED PROPERTIES, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED PRO
FORMA CONSOLIDATED FINANCIAL STATEMENTS
Transaction Accounting Adjustment –
C, D, and E
Adjustments to Unaudited Pro Forma Consolidated Statements of
Operations
The pro forma accounting adjustments included
in the unaudited pro forma consolidated statements of operations for the year ended December 31, 2025 are as follows:
Transaction Accounting
Adjustment C - to reflect the reversal of the revenues, professional fees, general and administrative expenses, depreciation and amortization
and real estate taxes as of the beginning of the period related to the sale of the CGK Properties.
Transaction Accounting
Adjustment D - to reflect the reversal of the revenues, general and administrative expenses, depreciation and amortization, real estate
taxes and impairment loss from rental properties as of the beginning of the period related to the sale of the Pleasant Ridge Assets.
Transaction Accounting
Adjustment E - to reflect the reversal of the revenues, compensation and benefits, professional fees, brokerage fees, general and
administrative expenses, depreciation and amortization, real estate taxes, property portfolio business development costs, and impairment
loss from rental properties as of the beginning of the period related to the Asset Sale.
Transaction Accounting Adjustment –
F, G and H
Adjustments to Unaudited Pro Forma Consolidated Statements of
Operations
The pro forma adjustments included in the unaudited
pro forma consolidated statements of operations for the six months ended June 30, 2026 are as follows:
Transaction Accounting
Adjustment F - to reflect the reversal of the revenues, professional fees, general and administrative expenses, depreciation and amortization
and real estate taxes as of the beginning of the period related to the sale of the CGK Properties.
Transaction Accounting
Adjustment G - to reflect the reversal of the revenues, general and administrative expenses, depreciation and amortization, real estate
taxes and impairment loss from rental properties as of the beginning of the period related to the sale of the Pleasant Ridge Assets.
Transaction Accounting
Adjustment H - to reflect the reversal of the revenues, compensation and benefits, professional fees, brokerage fees, general and
administrative expenses, depreciation and amortization, real estate taxes, property portfolio business development costs, and impairment
loss from rental properties as of the beginning of the period related to the Asset Sale.
