CLEARONE INC

(a) On March 27, 2025, ClearOne, Inc., a Delaware corporation (the “Company”), entered into engagement letter dated as of March 20, 2025 (the “Engagement Letter”) with RBW Capital Partners LLC (“RBW”) and Dawson James Securities, Inc. (“Dawson James,” and together with RBW, the “Advisor”) to assist the Company with capital raising efforts and the sale of the Company by way of a negotiated merger or consolidation, including a reverse merger, the negotiated sale of all or substantially all of the Company’s assets, the sale, via negotiated tender offer, of the Company’s issued and outstanding shares of stock, or a spin-off of the Company’s current business and operations to its current stockholders (each, a “Strategic Transaction”).

The engagement of the Advisor is part of a comprehensive review of strategic alternatives being conducted by the Company’s Board of Directors (the “Board”) focused on maximizing shareholder value, including but not limited to, equity or debt financing alternatives, merger and acquisition transactions, divestiture of assets, licensing opportunities, joint ventures, collaborations or other partnerships with other companies, or a spin-off of the Company’s current business and operations. The Board has formed a special transaction committee of the Board (the “Special Transaction Committee”) consisting of independent and disinterested directors and delegated all power and authority of the Board to the Special Transaction Committee to oversee the Company’s evaluation of strategic alternatives. There is no set timetable for this process and there can be no assurance that this process will result in the Company pursuing a Strategic Transaction or that any transaction, if pursued, will be completed on attractive terms or at all. The Company does not expect to disclose developments with respect to this process unless and until the evaluation of strategic alternatives has been completed or the Company has concluded that disclosure is appropriate or legally required.

Pursuant to the terms and conditions of the Company’s Engagement Letter with the Advisor, the Advisor will act as the Company’s exclusive placement agent and financial advisor for a term of six months to assist the Company with capital raising efforts and identifying potential acquisition or merger partners for the Company and negotiating and consummating a Strategic Transaction with one or more such parties. As consideration for the financial advisory services to be provided by the Advisor to the Company, the Company will pay the Advisor the following fees pursuant to the Engagement Letter:

A success fee payable equal to five percent (5%) of the transaction value of any completed Strategic Transaction with any parties not previously known to the Company prior to the engagement of the Advisor;

In connection with any sale of debt or equity securities contemplated by the Engagement Letter, a cash success fee of eight percent (8%) of the amount of capital raised; and

Reimbursement of Advisor’s out-of-pockets fees and expenses up to $150,000.

The Engagement Letter also includes a tail fee provision that requires the Company to pay the foregoing fees to the Advisor with respect to any Strategic Transaction completed within twelve (12) months following the term of the Engagement Letter with a party introduced to the Company by the Advisor.

The Company also has agreed to a customary lock-up provision that prohibits the Company and its affiliates, officers, and directors will not, directly or indirectly, offer, sell, contract to sell, grant any option to purchase, or otherwise dispose of any shares of the Company’s securities until 90 days after the completion of any Strategic Transaction, including any sale of Company securities.

The foregoing summary of the material terms of the Engagement Letter is qualified entirely by reference to Engagement Letter, a copy of which is filed as Exhibit 10.11 to this Annual Report on Form 10-K and incorporated herein by reference.

The foregoing disclosure of the Engagement Letter is set forth in Item 9B of this Form 10-K in lieu of a separate Form 8-K disclosing the Engagement Letter under Items 1.01 and 9.01 of Form 8-K.

(b) None