Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from _________ to _________

Commission file number 001-32420

CHARLIE’S HOLDINGS, INC.

(Exact Name of Registrant as Specified in Its Charter)

Nevada

84-1575085

(State or Other Jurisdiction of

Incorporation or Organization)

(IRS Employer

Identification No.)

1007 Brioso Drive, Costa Mesa, CA 92627

(Address of Principal Executive Offices)

(949) 531-6855

(Registrant’s Telephone Number, Including Area Code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☒	Smaller reporting company ☒
	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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-12 of the Exchange Act). Yes ☐ No ☒

Securities registered pursuant to Section 12(b) of the Act: None

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

There were 229,227,388 shares of the registrant’s common stock outstanding as of August 19, 2024.

CHARLIE’S HOLDINGS, INC.

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTER ENDED JUNE 30, 2024

INDEX

			Page
PART I. FINANCIAL INFORMATION

	ITEM 1.	Financial Statements
		Condensed Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023	1
		Condensed Consolidated Statements of Operations (unaudited) for the three and six months ended June 30, 2024 and 2023	2
		Condensed Consolidated Statements of Stockholders’ Deficit (unaudited) for the three and six months ended June 30, 2024 and 2023	3
		Condensed Consolidated Statements of Cash Flows (unaudited) for the three and six months ended June 30, 2024 and 2023	4
		Notes to Condensed Consolidated Financial Statements (unaudited)	5
	ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
	ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	25
	ITEM 4.	Controls and Procedures	25

PART II. OTHER INFORMATION

	ITEM 1.	Legal Proceedings	25
	ITEM 1A.	Risk Factors	25
	ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	26
	ITEM 3.	Defaults Upon Senior Securities	26
	ITEM 4.	Mine Safety Disclosures	26
	ITEM 5.	Other Information	26
	ITEM 6.	Exhibits	26

SIGNATURES			27

PART I

ITEM 1. FINANCIAL STATEMENTS

CHARLIE’S HOLDINGS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)

	June 30,			December 31,
	2024			2023
	(Unaudited)
ASSETS
Current assets:
Cash	$	1,085		$	367
Accounts receivable, net		332			289
Inventories, net		3,203			3,826
Prepaid expenses and other current assets		196			604
Total current assets		4,816			5,086

Non-current assets:
Property, plant and equipment, net		91			157
Right-of-use asset, net		219			424
Other assets		101			101
Total non-current assets		411			682

TOTAL ASSETS	$	5,227		$	5,768

LIABILITIES AND STOCKHOLDERS' (DEFICIT)
Current liabilities:
Accounts payable and accrued expenses	$	3,016		$	2,846
Notes payable, net		382			716
Notes payable - related parties		1,514			700
Derivative liability		-			79
Lease liabilities		223			355
Deferred revenue		238			58
Total current liabilities		5,373			4,754

Non-current liabilities:
Note payable, net of current portion		150			150
Note payable, net - related party, net of current portion		-			898
Lease liabilities, net of current portion		-			73
Total non-current liabilities		150			1,121

Total liabilities		5,523			5,875

COMMITMENTS AND CONTINGENCIES (see Note 12)

Stockholders' deficit:
Convertible preferred stock ($0.001 par value); 1,800,000 shares authorized
Series A, 300,000 shares designated; 126,680 and 128,181 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively		-			-
Series B, 1,500,000 shares designated; 0 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively		-			-
Common stock ($0.001 par value); 500,000,000 shares authorized; 249,602,388 and 228,535,886 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively		250			229
Additional paid-in capital		10,006			8,204
Accumulated deficit		(10,552	)		(8,540	)
Total stockholders' deficit		(296	)		(107	)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	$	5,227		$	5,768

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CHARLIE’S HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share amounts)

(Unaudited)

	For the three months ended						For the six months ended
	June 30,						June 30,
	2024			2023			2024			2023
Revenues:
Product revenue, net	$	2,043		$	3,970		$	5,094		$	8,000
Total revenues		2,043			3,970			5,094			8,000
Operating costs and expenses:
Cost of goods sold - product revenue		1,265			1,879			3,372			5,018
General and administrative		1,423			1,775			2,968			3,763
Sales and marketing		117			319			451			687
Research and development		(26	)		39			(20	)		91
Total operating costs and expenses		2,779			4,012			6,771			9,559
Loss from operations		(736	)		(42	)		(1,677	)		(1,559	)
Other income (expense):
Interest expense		(156	)		(111	)		(339	)		(242	)
Debt extinguishment (loss) gain		(75	)		-			(75	)		35
Change in fair value of derivative liabilities		-			185			79			408
Total other (loss) income		(231	)		74			(335	)		201
Net (loss) income	$	(967	)	$	32		$	(2,012	)	$	(1,358	)

Net income (loss) per share
Basic	$	0.00		$	0.00		$	(0.01	)	$	(0.01	)
Diluted	$	0.00		$	0.00		$	(0.01	)	$	(0.01	)
Weighted average number of common shares outstanding
Basic		228,988,755			216,372,777			224,795,559			214,987,456
Diluted		228,988,755			245,299,090			224,795,559			214,987,456

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CHARLIE’S HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

(in thousands)

(Unaudited)

	For the Three Months Ended June 30, 2024
	Series A
	Convertible Preferred Stock				Common Stock					Additional			Accumulated			Total Stockholders'
	Shares		Par value		Shares			Par value		Paid-in Capital			Deficit			Deficit
Balance at April 1, 2024		127	$	-		229,349		$	229	$	8,266		$	(9,585	)	$	(1,090	)
Issuance of common shares for cash		-		-		12,875			13		1,017			-			1,030
Issuance of common shares from debt redemption		-		-		7,500			8		668			-			676
Forfeiture of restricted stock awards		-		-		(122	)		-		(1	)		-			(1	)
Stock compensation		-		-		-			-		56			-			56
Net loss		-		-		-			-		-			(967	)		(967	)
Balance at June 30, 2024		127	$	-		249,602		$	250	$	10,006		$	(10,552	)	$	(296	)

	For the Three Months Ended June 30, 2023
	Series A
	Convertible Preferred Stock					Common Stock				Additional			Accumulated			Total Stockholders'
	Shares			Par value		Shares		Par value		Paid-in Capital			Deficit			Equity
Balance at April 1, 2023		130		$	-		224,112	$	224	$	7,968		$	(7,837	)	$	355
Conversion of Series A convertible preferred stock		(2	)		-		434		1		(1	)		-			-
Stock compensation		-			-		184		-		37			-			37
Net income		-			-		-		-		-			32			32
Balance at June 30, 2023		128		$	-		224,730	$	225	$	8,004		$	(7,805	)	$	424

	For the Six Months Ended June 30, 2024
	Series A
	Convertible Preferred Stock					Common Stock					Additional			Accumulated			Total Stockholders'
	Shares			Par value		Shares			Par value		Paid-in Capital			Deficit			Deficit
Balance at January 1, 2024		128		$	-		228,535		$	229	$	8,204		$	(8,540	)	$	(107	)
Issuance of common shares for cash		-			-		12,875			13		1,017			-			1,030
Issuance of common shares from debt redemption		-			-		7,500			8		668			-			676
Conversion of Series A convertible preferred stock		(1	)		-		339					(0	)		-			(0	)
Forfeiture of restricted stock awards		-			-		(172	)		-		(1	)		-			(1	)
Stock compensation		-			-		525			-		118			-			118
Net loss		-			-		-			-		-			(2,012	)		(2,012	)
Balance at June 30, 2024		127		$	-		249,602		$	250	$	10,006		$	(10,552	)	$	(296	)

	For the Six Months Ended June 30, 2023
	Series A
	Convertible Preferred Stock					Common Stock				Additional			Accumulated			Total Stockholders'
	Shares			Par value		Shares		Par value		Paid-in Capital			Deficit			Equity
Balance at January 1, 2023		133		$	-		219,163	$	219	$	7,928		$	(6,447	)	$	1,700
Conversion of Series A convertible preferred stock		(5	)		-		1,183		2		(2	)		-			-
Stock compensation		-			-		4,384		4		78			-			82
Net loss		-			-		-		-		-			(1,358	)		(1,358	)
Balance at June 30, 2023		128		$	-		224,730	$	225	$	8,004		$	(7,805	)	$	424

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CHARLIE’S HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(Unaudited)

	For the six months ended
	June 30,
	2024			2023
Cash Flows from Operating Activities:
Net loss	$	(2,012	)	$	(1,358	)
Reconciliation of net loss to net cash used in operating activities:
Allowance for doubtful accounts		10			85
Depreciation and amortization		66			80
Accretion of debt discount		137			132
Change in fair value of derivative liabilities		(79	)		(408	)
Debt extinguishment loss (gain)		75			(35	)
Amortization of operating lease right-of-use asset		205			182
Stock based compensation		117			82
Subtotal of non-cash charges		531			118
Changes in operating assets and liabilities:
Accounts receivable		(53	)		554
Inventories		623			621
Prepaid expenses and other current assets		466			327
Accounts payable and accrued expenses		170			117
Deferred revenue		180			(75	)
Lease liabilities		(205	)		(180	)
Net cash (used in) provided by operating activities		(300	)		124
Cash Flows from Financing Activities:
Proceeds from issuance of common shares		1,030			-
Proceeds from issuance of notes payable		-			630
Proceeds from issuance of notes payable to related party		500			-
Repayment of notes payable		(462	)		(668	)
Repayment of notes payable to related party		(50	)		-
Net cash provided by financing activities		1,018			(38	)
Net increase in cash		718			86

Cash, beginning of the period		367			257
Cash, end of the period	$	1,085		$	343

Supplemental disclosure of cash flow information
Cash paid for interest	$	4		$	145
Cash paid for interest to related party	$	90		$	15
Cash paid for income taxes	$	-		$	4

Supplemental disclosure of cash flow information
Conversion of Series A convertible preferred stock	$	-		$	2
Issuance of common shares from debt redemption	$	676		$	-

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CHARLIE'S HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 – DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION

Description of the Business

Charlie’s Holdings, Inc., a Nevada corporation, together with its wholly owned subsidiaries and consolidated variable interest entity (collectively, the “Company”), currently formulates, markets and distributes premium, non-combustible nicotine-related products, alternative alkaloid vapor products, and hemp-derived vapor and edible products. The Company’s products are produced through contract manufacturers for sale by select distributors, specialty retailers, and third-party online resellers throughout the United States, as well as in six primary countries worldwide.

Charlie’s Chalk Dust, LLC (“Charlie’s” or “CCD”), is the Company’s wholly owned subsidiary which produces and sells nicotine-based and alternative alkaloid vapor products. Don Polly is a consolidated variable interest entity, for which the Company is the primary beneficiary, which develops, markets and distributes products containing cannabinoids derived from hemp.

The Company's common stock, par value $0.001 per share (the “Common Stock”), trades under the symbol "CHUC" on the OTCQB Venture Market.

Substantial Doubt to Continue as a Going Concern Regarding the Legal and Regulatory Environment, Liquidity and Management’s Plan of Operation

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company operates in a rapidly changing legal and regulatory environment; new laws and regulations or changes to existing laws and regulations could significantly limit the Company’s ability to sell its products, and/or result in additional costs. Additionally, the Company was required to obtain approval from the United States Food and Drug Administration ("FDA") to continue selling and marketing certain of products used for the vaporization of nicotine in the United States. Currently, a substantial portion of the Company’s sales are derived from products that are subject to approval by the FDA. There was a significant cost associated with the application process and there can be no assurance the FDA will approve previous and/or future applications. For the six months ended June 30, 2024, the Company’s revenue declined, the Company generated a loss from operations of approximately $1,677,000, and a consolidated net loss of approximately $2,012,000. Cash used in operations was approximately $300,000. The Company had a stockholders’ deficit of $296,000 at June 30, 2024. During the six months ended June 30, 2024, the Company’s working capital position decreased to a deficit of $557,000 from $332,000 as of December 31, 2023. Considering these facts, the issuance of one or several Marketing Denial Orders ("MDOs”) from the FDA would increase the potential for inventory obsolescence and uncollectable accounts receivables and potentially require us to remove products from circulation. These regulatory risks, as well as other industry-specific challenges, our low working capital and cash position remain factors that raise substantial doubt about the Company’s ability to continue as a going concern.

Our plans and growth depend on our ability to increase revenues, procure cost-effective financing, and continue our business development efforts, including the expenditure of approximately $6,000,000 as of June 30, 2024, to support our PMTA process for the Company’s submissions to the FDA. The Company has undergone cost-cutting measures including salary reductions of up to 25% for officers and certain managers and a reduction in headcount for certain departments. During the fourth quarter of 2023, the Company launched SPREE BAR, a non-nicotine, disposable pod system vapor product which is not subject to FDA review or covered under the Agriculture Improvement Act (the “Farm Bill”). The Company may require additional financing in the future to support the development of new product categories as well as subsequent PMTA filings, and/or in the event the FDA requests additional testing for one, or several, of the Company’s prior PMTA submissions. There can be no assurance that additional financing will be available on acceptable terms, or at all, and there can be no assurance that any such arrangement, if required or otherwise sought, would be available on terms deemed to be commercially acceptable and, in the Company’s best interests. The financial statements do not include any adjustments to the carrying amount and classification of recorded assets and liabilities should the Company be unable to continue operations. If we do not have sufficient funds to continue operations, we could be required to seek bankruptcy protection or other alternatives that would likely result in our stockholders losing some or all their investment in us.

Risks and Uncertainties

The Company operates in an environment that is subject to rapid changes and developments in laws and regulations that could have a significant impact on the Company’s ability to sell its products. Beginning in September 2019, certain states temporarily banned the sale of flavored e-cigarettes, and several states and municipalities are considering implementing similar restrictions. Federal, state, and local governmental bodies across the United States have indicated that flavored e-cigarette liquid, vaporization products and certain other consumption accessories may become subject to new laws and regulations at the federal, state, and local levels. In addition, in June 2022, the FDA announced a plan to reduce nicotine levels in cigarettes to minimally or non-addictive levels. The application of any new laws or regulations that may be adopted in the future, at a federal, state, or local level, directly or indirectly implicating nicotine, flavored e-cigarette liquid and other electronic nicotine delivery system (“ENDS”) products, could significantly limit the Company’s ability to sell such products, result in additional compliance expenses, and/or require the Company to change its labeling and/or methods of distribution. Any ban of the sale of flavored e-cigarettes directly limits the markets in which the Company may sell its products. In the event the prevalence of such bans and/or changes in laws and regulations increase across the United States, or internationally, the Company’s business, results of operations and financial condition could be adversely impacted. In addition, the Company is presently seeking to obtain marketing authorization for certain of its tobacco-derived nicotine e-liquid products. The Company’s applications were submitted in September 2020 on a timely basis, which if approved, will allow the Company to continue to sell its approved products in the United States. Beginning in August 2021, the FDA began issuing Marketing Denial Orders (“MDO”) for ENDS products that lack evidence to demonstrate that permitting the marketing of such products would be appropriate for the protection of the public health. The Company has not received an MDO for any of its 2020 PMTA submissions; however, there is no assurance that regulatory approval to sell our products will be granted or that Charlie’s would be able to raise additional financing if required, which could have a significant impact on our sales. On March 15, 2022, a new rider to the Federal Food, Drug and Cosmetic Act was passed granting the FDA authority over synthetic nicotine. These regulations make the Company’s synthetic nicotine products subject to the same FDA rules as tobacco-derived nicotine products. As such, the Company was required to file a PMTA for its existing synthetic nicotine products marketed under the Pacha brands by May 14, 2022 or be subject to FDA enforcement. The Company filed new PMTAs, for its synthetic Pacha products on May 13, 2022, prior to the May 14, 2022 deadline. On November 3, 2022, FDA accepted for scientific review certain of our PMTAs for synthetic nicotine products and, on November 4, 2022, FDA refused to accept certain other PMTAs for these products, rendering the latter products subject to FDA enforcement. The Company pursued an administrative appeal with FDA regarding its refusal to accept certain of the PMTAs. The administrative appeal was granted on October 30, 2023 and the products were accepted to move forward in the PMTA review process. The Company continues to sell the affected products while the PMTA review process continues. The FDA may bring an enforcement action against our synthetic nicotine products for lack of premarket authorization and/or issue an MDO to our pending applications at any time. More generally, FDA’s regulatory initiatives and enforcement priorities regarding ENDS products are unpredictable and continue to evolve, and the Company cannot predict whether FDA’s priorities and review of our premarket submissions will impact our products to a greater degree than our competitors in the industry.

During the fourth quarter of 2023 the Company launched new disposable vape products, under the “SPREE BAR™” brand. The Company and its attorneys believe SPREE BAR products are not subject to FDA review. Based on the information provided by the Company’s contracted chemical suppliers and its consultants, the proprietary Metatine™ (patented in the United States and in China by the Company’s chemical supplier) in the Company’s SPREE BAR products does not meet the definition of nicotine set forth in 21 U.S.C. § 387(12) and therefore its products containing Metatine, as their active ingredient, are not subject to regulation as “tobacco products” under 21 U.S.C. § 321(rr). Further, according to information provided by the Company’s chemists, the other ingredients in the Company’s SPREE BAR vape liquid are not made or derived from tobacco, nor do they contain nicotine from any source. The documentary support for these facts, including a Certificate of Analysis (“COA”) for the Metatine used in the Company’s SPREE BAR products, corroborates these conclusions. However, should any of these understandings be incorrect, the Company’s position on Metatine not meeting the definition of a “tobacco product” would need to be revisited. Further, should Congress bestow regulatory control over Metatine to the FDA, or should the FDA deem Metatine disposable vape devices “tobacco products” despite the facts that Metatine is not a salt or complex of nicotine, and is not itself derived from nicotine or tobacco, SPREE BAR products might then be subject to the FDA tobacco requirements, including, but not limited to, the requirement that all newly deemed tobacco products obtain premarket authorization before entering the U.S. market. If this were to happen, the FDA could bring an enforcement action against our Metatine products for lack of premarket authorization. More generally, FDA’s regulatory initiatives and enforcement authority regarding our products are unpredictable and continue to evolve and we cannot predict whether FDA’s priorities and/or potential jurisdiction over our products will require us to remove our products from the market and to cease selling them.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) have been omitted pursuant to SEC rules and regulations; nevertheless, the Company believes that the disclosures are adequate to make the information presented in this Report not misleading. The unaudited interim financial statements furnished in this document reflect all adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

Significant Accounting Policies

There have been no material changes in the Company’s significant accounting policies to those previously disclosed in the 2023 Annual Report.

Recently Issued Accounting Standards, Not Yet Adopted

Improvements to Reportable Segment Disclosures

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”). ASU 2023-07 updates segment reporting disclosure requirements and brings about significant changes, particularly in the realm of transparency and accountability within organizations. The primary thrust of ASU 2023-07 is the inclusion of detailed disclosures regarding significant reportable segment expenses. These are expenses regularly provided to the Chief Operating Decision Maker (“CODM”) and are integral components of each reported measure reflecting a segment's profit or loss. Furthermore, the ASU mandates disclosure of the CODM's title, position, and a comprehensive explanation of how the reported measures of segment profit or loss factor into assessing segment performance and resource allocation decisions. This transparency aims to provide stakeholders with a clearer understanding of the decision-making processes within an organization and how segment performance is evaluated.

Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which improves the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the effective tax rate reconciliation and income taxes paid disaggregated by jurisdiction. It also includes certain other amendments to improve the effectiveness of income tax disclosures. This guidance will be effective for the annual periods beginning the year ended December 31, 2025. Early adoption is permitted. Upon adoption, the guidance can be applied prospectively or retrospectively. The Company does not expect the adoption of this guidance to have a material impact on its condensed consolidated financial statements.

Scope Applications of Profits Interests and Similar Awards

In March 2024, the FASB issued ASU No. 2024-01, “Compensation-Stock Compensation (Topic 718): Scope Applications of Profits Interests and Similar Awards” (ASU 2024-01). ASU 2024-01 adds an example to Topic 718 which illustrates how to apply the scope guidance to determine whether profits interests and similar awards should be accounted for as share-based payment arrangements under Topic 718 or under other U.S. GAAP. ASU 2024-01 is effective for annual periods beginning after December 15, 2024, although early adoption is permitted. Upon adoption, ASU 2024-01 is not expected to have an impact on the Company’s condensed consolidated financial statements.

NOTE 3 – FAIR VALUE MEASUREMENTS

In accordance with Accounting Standards Codification (“ASC”) Topic 820 “Fair Value Measurements and Disclosures” (“ASC 820”), the Company uses various inputs to measure the outstanding warrants on a recurring basis to determine the fair value of the liability. ASC 820 also establishes a hierarchy categorizing inputs into three levels used to measure and disclose fair value. The hierarchy gives the highest priority to quoted prices available in active markets and the lowest priority to unobservable inputs. An explanation of each level in the hierarchy is described below:

Level 1 – Unadjusted quoted prices in active markets for identical instruments that are accessible by the Company on the measurement date.

Level 2 – Quoted prices in markets that are not active or inputs which are either directly or indirectly observable.

Level 3 – Unobservable inputs for the instrument requiring the development of assumptions by the Company.

The following table classifies the Company’s liabilities measured at fair value on a recurring basis into the fair value hierarchy as of June 30, 2024, and December 31, 2023 (amounts in thousands):

Fair Value at June 30, 2024

Total

Level 1

Level 2

Level 3

Liabilities:

Derivative liability - Warrants

Total liabilities

	Fair Value at December 31, 2023
	Total		Level 1		Level 2		Level 3
Liabilities:
Derivative liability - Warrants		79		-		-		79
Total liabilities	$	79	$	-	$	-	$	79

There were no transfers between Level 1, 2 or 3 during the six-month period ended June 30, 2024.

The following table presents changes in Level 3 liabilities measured at fair value for the six-month period ended June 30, 2024. Both observable and unobservable inputs were used to determine the fair value of positions that the Company has classified within the Level 3 category. Unrealized gains and losses associated with liabilities within the Level 3 category include changes in fair value that were attributable to both observable (e.g., changes in market interest rates) and unobservable (e.g., changes in unobservable long-dated volatilities) inputs (amounts in thousands).

	Derivative liability - Warrants
Balance at January 1, 2024	$	79
Change in fair value		(79	)
Balance at June 30, 2024	$	-

A summary of the weighted average (in aggregate) significant unobservable inputs (Level 3 inputs) used in the Monte Carlo simulation measuring the Company’s derivative liabilities that are categorized within Level 3 of the fair value hierarchy as of April 26, 2024 and December 31, 2023, is as follows:

	April 26,			December 31,
	2024			2023
Exercise price	$	0.4431		$	0.4431
Contractual term (years)		0.07			0.32
Volatility (annual)		110.0	%		90.0	%
Risk-free rate		4.5	%		5.4	%
Dividend yield (per share)		0	%		0	%

On April 26, 2019 (the “Closing Date”), the Company entered into a Securities Exchange Agreement (“Share Exchange”) with each of the former members (“Members”) of Charlie’s, and certain direct investors in the Company (“Direct Investors”), pursuant to which the Company acquired all outstanding membership interests of Charlie’s beneficially owned by the Members in exchange for the issuance by the Company of units. Immediately prior to, and in connection with, the Share Exchange, Charlie’s consummated a private offering of membership interests that resulted in net proceeds to Charlie’s of approximately $27.5 million (the “Charlie’s Financing”). In conjunction with the Share Exchange, the Company issued to holders of its Series A Convertible Preferred Stock, par value $0.001 per share (“Series A Preferred”), warrants to purchase an aggregate of 31,028,996 shares of Common Stock (the “Investor Warrants”) and to its placement agent, Katalyst Securities LLC, warrants to purchase an aggregate of 9,308,699 shares of Common Stock (the “Placement Agent Warrants”). Both the Investor Warrants and Placement Agent Warrants have a five-year term and a strike price of $0.44313 per share. Due to the exercise features of these warrants, they are not considered to be indexed to the Company’s own stock and are therefore not afforded equity treatment in accordance with ASC Topic 815, “Derivatives and Hedging” (“ASC 815”). In accordance with ASC 815, the Company has recorded the Investor Warrants and Placement Agent Warrants as derivative instruments on its consolidated balance sheet. ASC 815 requires derivatives to be recorded on the balance sheet as an asset or liability and to be measured at fair value. Changes in fair value are reflected in the Company’s earnings for each reporting period.

On April 26, 2024, the Investor Warrants and Placement Agent Warrants expired without being exercised.

NOTE 4 – PROPERTY AND EQUIPMENT

Depreciation and amortization expense totaled $66,000 and $80,000, respectively, during the six months ended June 30, 2024 and 2023. Property and equipment as of June 30, 2024 and December 31, 2023, are as follows (dollar amounts in thousands):

	June 30,			December 31,			Estimated Useful Life
	2024			2023			(years)
Machinery and equipment	$	41		$	41			5
Trade show booth		202			202			5
Office equipment		539			539			5
Leasehold improvements		254			254		Lesser of lease term or estimated useful life
		1,036			1,036
Accumulated depreciation		(945	)		(879	)
Net Property & Equipment	$	91		$	157

NOTE 5 – CONCENTRATIONS

Vendors

The Company’s concentration of inventory purchases is as follows:

	For the three months ended June 30,						For the six months ended June 30,

	2024			2023			2024			2023

Vendor A		13	%		44	%		-			62	%
Vendor B		-			12	%		-			13	%
Vendor C		44	%		-			24	%		-
Vendor D		-			-			16	%		-
Vendor E		-			-			15	%		-
Vendor F		-			-			12	%		-
Vendor G		17	%		-			-			-
Vendor H		12	%		-			-			-

During the three months ended June 30, 2024 and 2023, purchases from five vendors represented 86% and 56%, respectively, of total inventory purchases. During the six months ended June 30, 2024 and 2023, purchases from six vendors represented 67% and 75%, respectively, of total inventory purchases.

As of June 30, 2024, and December 31, 2023, amounts owed to these vendors totaled $666,000 and $266,000 respectively, which are included in accounts payable and accrued expenses in the accompanying condensed consolidated balance sheets.

Accounts Receivable

The Company’s concentration of accounts receivable is as follows:

	June 30,				December 31,
	2024				2023

Customer A	$	117,000	30	%	$	93,000	27	%
Customer B	$	38,000	10	%	$	47,000	13	%
Customer C	$	41,000	10	%	$	71,000	20	%
Customer D					$	39,000	11	%
Customer E					$	33,000	10	%
Customer F	$	43,000	11	%		-	-

Four customers made up more than 61% of net accounts receivable at June 30, 2024. Five customers made up more than 81% of net accounts receivable at December 31, 2023. No customer exceeded 10% of total net sales for the three-month and six-month periods ended June 30, 2024 and 2023, respectively.

NOTE 6 – DON POLLY, LLC

Don Polly is a Nevada limited liability company that is owned by entities controlled by Brandon and Ryan Stump, a former and current executive officer of the Company, respectively, and a consolidated variable interest for which the Company is the primary beneficiary. Don Polly formulates, sells and distributes the Company’s hemp-derived product lines.

Don Polly is classified as a variable interest entity (“VIE”) for which the Company is the primary beneficiary. Under ASC 810-10-15, Variable Interest Entities, a VIE is an entity that: (1) has an insufficient amount of equity investment at risk to permit the entity to finance its activities without additional subordinated financial support by other parties; (2) the equity investors are unable to make significant decisions about the entity’s activities through voting rights or similar rights; or (3) the equity investors do not have the obligation to absorb expected losses or the right to receive residual returns of the entity. The Company is required to consolidate a VIE if it is determined to be the primary beneficiary, that is, the enterprise has both (1) the power to direct the activities of a VIE that most significantly impact the entity’s economic performance and (2) the obligation to absorb losses of the entity that could potentially be significant to the VIE. The Company evaluates its relationships with a VIE to determine whether it is the primary beneficiary of a VIE at the time it becomes involved with the entity and it re-evaluates that conclusion each reporting period. Effective April 25, 2019, the Company began consolidating the financial statements of Don Polly and it is still considered a VIE of the Company.

Don Polly operates under exclusive licensing and service contracts with the Company whereby the Company receives 100% of the net income, or incurs 100% of the net loss of the VIE. There are no non-controlling interests recorded.

NOTE 7 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses as of June 30, 2024 and December 31, 2023, are as follows (amounts in thousands):

	June 30,		December 31,
	2024		2023
Accounts payable	$	1,626	$	1,472
Accrued compensation		546		573
Accrued income taxes		128		128
Customer deposits		31		386
Other accrued expenses		685		287
	$	3,016	$	2,846

NOTE 8 – NOTES PAYABLE

January 2024 Note Financing

On January 24, 2024, the Company issued an unsecured promissory note (the “Red Beard Note”) to one of its largest stockholders Red Beard Holdings LLC (the “Red Beard Lender"), in the principal amount of $500,000. Red Beard Note shall bear interest at twenty-one percent (21%) per annum and have maturity through July 24, 2024.

On May 31, 2024, as part of the May 2024 capital raise (see Note 10), the holder of the Red Beard Note (the “Holder”) converted the principal amount of $500,000 in lieu of cash payment for the subscription agreement. Separately, the Holder was paid $52,500 in interest on the maturity date of July 24, 2024.

July 2023 Note Financing

Between July 17, 2023 and August 1, 2023, the Company issued unsecured promissory notes (the “Notes”) to several of its executives and employees, Ryan Stump, Henry Sicignano III, Keith Stump, and Jessica Greenwald, and to three of its largest stockholders, Brandon Stump, Red Beard Holdings LLC, and Michael King (the “Lenders"), in the cumulative principal amount of $1,400,000. Notes shall bear interest at twenty-one percent (21%) per annum and have maturity dates ranging from November 17, 2023 to December 10, 2023.

During the year ended December 31, 2023, the Company made a $1,070,000 repayment to the Notes, including a $70,000 interest payment. As of June 30, 2024, $400,000 of Notes remained outstanding with Ryan Stump and Henry Sicignano III, and the maturity dates of the outstanding notes have been extended to October 16, 2024.

2023 Receivables Financing

On December 13, 2023 the Company entered into a future receivables sale agreement (“Receivables Financing” or “Receivables Financing Agreement”) with Austin Business Finance (“Austin Purchaser”) by which Austin Purchaser purchases from the Company, its future accounts and contract rights arising from the sale of goods or rendition of services to the Company’s customers. The purchase price, as defined by the Receivables Financing Agreement, was $750,000 which was paid to the Company on December 13, 2023, net of a 3% origination fee. The Receivables Financing Agreement required fifty-two equal payments of $17,740 to be paid weekly for a total repayment of $922,500 over the term of the agreement. As of June 30, 2024, $426,000 remained outstanding.

April 2022 Note Financing

On April 6, 2022, the Company issued a secured promissory note (the “Note”) to one of its large individual stockholders, Michael King (the “Lender"), in the principal amount of $1,000,000, which Note is secured by accounts receivable of the Company pursuant to the terms of a Security Agreement entered into by and between the Company and the Lender (the "Note Financing"). On September 28, 2022, the Company and the Lender entered into a modification to the Note to extend the maturity date to March 28, 2023 and the Company paid all accrued interest under the Note through such date.

On March 28, 2023, the Company entered into a second modification to the Note to extend the maturity date to April 28, 2024, contingent upon the payment of all interest accrued under the Note through March 28, 2023 and certain other modifications to the Note. Principal shall be payable on the 28th day of each month in installments of $25,000, commencing April 28, 2023, continuing up to and including April 28, 2024 whereby a balloon payment for the remaining principal balance will be paid. Interest shall accrue on the aggregate outstanding principal amount at a rate equal to 20% simple interest per annum and shall be payable on the same day as installments of principal are payable. The Company may prepay all or any portion of the principal amount, together with all accrued but unpaid interest thereon, at any time without premium or penalty. All outstanding principal and interest are due earlier of April 28, 2024, or a liquidity event. The Company used the proceeds from the Note for general corporate purposes, and its working capital requirements, pending the availability of alternative debt financing.

On May 31, 2024, as part of the May 2024 capital raise (see Note 10), the Lender converted his next four debt repayments for the period from June to September 2024 for a total amount of $100,000 in lieu of cash payment for the subscription agreement.

August 2022 Note Financing – Related Party

On August 17, 2022, the Company and its Chief Operating Officer and Director, Ryan Stump (the "Stump Lender") entered into a loan agreement (the “Loan”) in the principal amount of $300,000. The Loan will be due in full in 120 days or sooner if, before the end of term, the Company secures (i) new debt financing or (ii) sufficient PMTA strategic partnership funds. The Loan bears an annual interest rate of 10%. The Company also incurred additional $3,000 issuance cost resulting from the payment of the Stump Lender’s legal fees. On April 15, 2024 the Company and Stump Lender entered into a fifth modification to the Loan to extend the maturity date to August 21, 2024.

Economic Injury Disaster Loan

On June 24, 2020, SBA authorized (under Section 7(b) of the Small Business Act, as amended) an Economic Injury Disaster Loan (“EID Loan”) to Don Polly in the amount of $150,000. The balance of principal and interest will be payable thirty years from the date of the EID Loan and interest will accrue at the rate of 3.75% per annum.

The following summarizes the Company’s notes payable maturities as of June 30, 2024 (amounts in thousands):

Six Months Ending December 31, 2024	$	1,126
Year Ending December 31, 2025		827
Year Ending December 31, 2026		-
Year Ending December 31, 2027		-
Year Ending December 31, 2028		-
Thereafter		150
		2,103
Debt discount		(57	)
Total	$	2,046

NOTE 9 – (LOSS) PER SHARE APPLICABLE TO COMMON STOCKHOLDERS

Basic (loss) per common share is computed by dividing net income by the weighted average number of common shares outstanding during the reporting period. Diluted (loss) per common share is computed similar to basic (loss) per common share except that it reflects the potential dilution that could occur if dilutive securities or other obligations to issue common stock were exercised or converted into common stock. Diluted weighted average common shares include common stock potentially issuable under the Company’s convertible preferred stock, warrants and vested and unvested stock options.

The following table sets forth the computation of (loss) earnings per share (amounts in thousands, except share and per share amounts):

	For the three months ended						For the six months ended
	June 30,						June 30,
	2024			2023			2024			2023
Net (loss) income - basic	$	(967	)	$	32		$	(2,012	)	$	(1,358	)
Reversal of gain due to change in fair value of warrant liability		-			(185	)		-			-
Net loss - diluted	$	(967	)	$	(153	)	$	(2,012	)	$	(1,358	)

Weighted average shares outstanding - basic		228,988,755			216,372,777			224,795,559			214,987,456
Diluted preferred shares		-			28,926,313			-			-
Weighted average shares outstanding - diluted		228,988,755			245,299,090			224,795,559			214,987,456

Basic earnings (loss) per share	$	0.00		$	0.00		$	(0.01	)	$	(0.01	)
Diluted earnings (loss) per share	$	0.00		$	(0.00	)	$	(0.01	)	$	(0.01	)

The following securities were not included in the diluted net loss per share calculation because their effect was anti-dilutive as of the periods presented (in thousands):

	For the six months ended
	June 30,
	2024		2023
Options		4,648		5,812
Warrants		40,338		40,338
Series A convertible preferred shares		28,588		28,926
Total		73,574		75,076

NOTE 10 – STOCKHOLDERS’ EQUITY

Conversion of Series A Preferred Shares

During the six months ended June 30, 2024, the Company issued approximately 339,000 shares of Common Stock upon conversion of 1,501 shares of Series A Preferred.

May 2024 Capital Raise

On May 31, 2024, the Company entered into subscription agreements with investors for the sale of an aggregate of 20,375,000 shares of its common stock, par value $0.001 per share, at a purchase price per share of $0.08 (the “Offering”). The Offering generated gross proceeds of approximately $1.63 million, which will be used for working capital purposes. The Offering was undertaken in reliance on Section 4(a)(2) under the Securities Act of 1933, as amended, as a transaction not involving a public offering.

As part of the Offering, certain note holders converted their outstanding debt and future debt repayments for total amount of $600,000 in lieu of cash payment for the subscription agreement (see Note 8). The Company recognized a $75,000 debt extinguishment loss for the three and six months ended June 30, 2024.

NOTE 11 – STOCK-BASED COMPENSATION

On May 8, 2019, our Board of Directors approved the Charlie’s Holdings, Inc. 2019 Omnibus Incentive Plan (the “2019 Plan”), and the 2019 Plan was subsequently approved by holders of a majority of our outstanding voting securities on the same date. Up to 11,072,542 stock options were originally grantable under the 2019 Plan.

On December 22, 2021, our Board of Directors unanimously adopted resolutions by written consent approving an amendment to increase the number of shares of Common Stock available for issuance under the 2019 Plan by 15.0 million shares, from 11,072,542 to 26,072,542 shares (the “2019 Plan Amendment”). Furthermore, the Company received written consents approving the 2019 Plan Amendment from holders of approximately 50.3% of our outstanding voting securities. In accordance with Rule 14c of the Exchange Act, our Board of Directors’ authority to implement the 2019 Plan Amendment became effective February 28, 2022, twenty calendar days after notification of our shareholders.

Non-Qualified Stock Options

The following table summarizes stock option activities during the six months ended June 30, 2024 (all option amounts are in thousands):

	Stock Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)		Aggregate Intrinsic Value
Outstanding at January 1, 2024		5,272		$	0.58		5.3	$	-
Options forfeited/expired		(624	)		1.44		-		-
Outstanding at June 30, 2024		4,648		$	0.46		5.3	$	-
Options vested and exercisable at June 30, 2024		4,648		$	0.46		5.3	$	-

Restricted Stock Awards

The following table summarizes restricted stock awards activities during the six months ended June 30, 2024 (all share amounts are in thousands):

	Number of Shares			Weighted Average Grant Date Fair Value per Share
Nonvested at January 1, 2024		10,095		$	0.050
Restricted stock granted		525			0.041
Vested		(3,414	)		-
Forfeited		(172	)		-
Nonvested at June 30, 2024		7,034		$	0.063

During the six months ended June 30, 2024, the Company granted 525,000 restricted stock awards (“RSAs”) to employees and contractors of the Company pursuant to the 2019 Plan, as amended. The RSAs are subject to a vesting schedule and have all the rights of a shareholder of the Company with respect to voting, share adjustments, receipt of dividends (if any) and distributions (if any) on such shares. The grant date fair value was approximately $77,000. During the six months ended June 30, 2024, approximately 50,000 RSAs issued to employees were forfeited.

As of June 30, 2024, there was approximately $288,000 of total unrecognized compensation expense related to non-vested restricted share-based compensation arrangements granted under the 2019 Plan, as amended. That cost is expected to be recognized over a weighted average period of 3.0 years. The Company recorded total stock-based compensation of approximately $117,000 and $82,000 during the six months ended June 30, 2024 and 2023 related to the RSAs, respectively.

NOTE 12 – COMMITMENTS AND CONTINGENCIES

Leases

The Company leases office space under agreements classified as operating leases that expire on various dates through 2024. All of the Company’s lease liabilities result from the lease of its headquarters in Costa Mesa, California, which expires in 2024, and its warehouse in Huntington Beach, California, which was renewed in May 2022 and expires May 2025. On April 29, 2022, the Company entered into a commercial lease agreement for the Company’s sales and marketing operations in Williamsville, New York (“Williamsville Lease”) with Henry Sicignano Jr., a relative of the Company’s President, Henry Sicignano III. The Williamsville Lease, which became effective on May 1, 2022, had a term of one year and a base rent of $1,650 per month. The Williamsville Lease has been extended for additional one year with same terms on May 1, 2024. The Williamsville Lease is considered a modified gross lease and therefore the Company will also be responsible for additional monthly expenses including gas, electricity, and internet. The Williamsville Lease was evaluated and approved by the Company’s Board of Directors.

Such leases do not require any contingent rental payments, impose any financial restrictions, or contain any residual value guarantees. Certain of the Company’s leases include renewal options and escalation clauses; renewal options have not been included in the calculation of the lease liabilities and right of use assets as the Company is not reasonably certain to exercise the options. Variable expenses generally represent the Company’s share of the landlord’s operating expenses. The Company does not act as a lessor or have any leases classified as financing leases.

The Company excludes short-term leases having initial terms of 12 months or less from ASC Topic 842, “Leases”, as an accounting policy election and recognizes rent expense on a straight-line basis over the lease term. The Company entered into a commercial lease for the Company’s corporate headquarters (the “Lease”) in Costa Mesa, California with Brandon Stump, the Company’s former Chief Executive Officer, Ryan Stump, the Company’s Chief Operating Officer, and Keith Stump, a former member of the Company’s Board of Directors. The Stumps purchased the property that is the subject of the Lease in July 2019. The Lease, which was effective as of September 1, 2019, on a month-to-month basis, was then formalized on November 1, 2019 to have a term of five years and a base rent rate of $22,940 per month, which rate is subject to annual adjustments based on the consumer price index, as may be mutually agreed upon by the parties to the Lease. The terms of the Lease were negotiated and approved by the independent members of the Board of Directors, after reviewing a detailed analysis of comparable properties and rent rates compiled by an independent, third-party consultant. The total rent paid to related parties for the six months ended June 30, 2024 and 2023 was approximately $138,000 and $138,000, respectively.

Effective June 1, 2022, the Company’s lease at 5331 Production Drive, Huntington Beach, CA was renewed for an additional three-year term, concluding May 31, 2025.

At June 30, 2024, the Company had operating lease liabilities of approximately $223,000 and right of use assets of approximately $219,000 which were included in the condensed consolidated balance sheet.

The following table summarizes quantitative information about the Company’s operating leases for the three and six months ended June 30, 2024 and 2023 (amounts in thousands):

	For the three months ended				For the six months ended
	June 30,				June 30,
	2024		2023		2024		2023
Operating leases
Operating lease cost	$	113	$	113	$	225	$	225
Variable lease cost		-		-		-		-
Operating lease expense		113		113		225		225
Short-term lease rent expense		5		5		10		10
Total rent expense	$	118	$	118	$	235	$	235

	For the six months ended
	June 30,
	2024			2023
Operating cash flows from operating leases	$	226		$	202
Weighted-average remaining lease term – operating leases (in years)		0.74			1.58
Weighted-average discount rate – operating leases		12.0	%		12.0	%

Maturities of our operating leases as of June 30, 2024, excluding short-term leases, are as follows (amounts in thousands):

Six Months Ending December 31, 2024	$	159
Year Ending December 31, 2025		75
Total		234
Less present value discount		(11	)
Operating lease liabilities as of March 31, 2024	$	223

Legal Proceedings

As of the date hereof, the Company is not a party to any material legal or administrative proceedings. There are no proceedings in which any of our directors, executive officers or affiliates, or any registered or beneficial stockholder, is an adverse party or has a material interest adverse to our interest. From time to time, the Company may be involved in various claims and counterclaims and legal actions arising in the ordinary course of business. Litigation or any other legal or administrative proceeding, regardless of the outcome, is likely to result in substantial cost and diversion of our resources, including our management’s time and attention.

New Executive Employment Agreement

On June 15, 2023, the Company entered into a new employment agreement with Ryan Stump (the “New Agreement”). Pursuant to the New Agreement, Mr. Stump will earn a base salary of $300,000 per year and serve as Chief Operating Officer for a term of two years, renewable on an annual basis unless earlier terminated by the Company or Mr. Stump. In the event that Mr. Stump is terminated by the Company without Cause (as defined therein) or for Good Reason (as defined therein), he will be entitled to receive his base salary and benefits for a period of one year. In the event of a change in control, all unvested equity awards will immediately vest. Notwithstanding his contracted annual salary, to cut costs during a time when the Company is striving to launch the SPREE BAR line, Mr. Stump has elected to reduce his current compensation to the rate of $225,000 annually. As a point of reference, all the Company’s other executives have also elected to reduce their current compensation. It is anticipated that, when financial circumstances permit, executive base salaries will revert to their previous levels.

NOTE 13 – INCOME TAXES

Income tax expense is comprised of domestic (US federal and state) income taxes at the applicable tax rates, adjusted for non-deductible expenses, stock compensation expenses, and other permanent differences. Our income tax provision may be affected by changes to our estimates. However, due to the full valuation allowance on our deferred tax assets, the net impact to our overall income tax expense is limited.

Under Sections 382 and 383 of the Code, if a corporation undergoes an “ownership change” (generally defined as a greater than 50 percentage points (by value) in the ownership of its equity over a three-year period), the corporation’s ability to use its pre-change tax attributes to offset its post change income may be limited. We may have experienced such ownership changes in the past, and we may experience ownership changes in the future or subsequent shifts in our stock ownership, many of which are outside our control. As of December 31, 2023, we had state net operating losses ("NOLs") of approximately $8.5 if not utilized before 2043. Our ability to utilize these NOLs and tax credit carryforwards may be limited by any “ownership changes” as described above that have occurred in prior years or that may occur in the future. If we undergo future ownership changes, many of which may be outside of our control, our ability to utilize our NOLs and tax credit carryforwards could be further limited by Sections 382 and 383 of the Code. There is also a risk that due to regulatory changes, such as suspensions on the use of NOLs, or other unforeseen reasons, our existing NOLs could expire or otherwise become unavailable to offset future income tax liabilities. Additionally, our NOLs and tax credit carryforwards could be limited under state law. For these reasons, even if we attain profitability, we may be unable to use a material portion of our NOLs and other tax attributes.

For the six months ended June 30, 2024 and 2023, the Company's estimate for income taxes was not determined to be significant, and therefore, is not reflected in the Company's condensed consolidated financial statements and related disclosures.

NOTE 14 – SUBSEQUENT EVENTS

The Company evaluated subsequent events for their potential impact on the consolidated condensed financial statements and disclosures through August 19, 2024, the date the consolidated condensed financial statements were available to be issued, and determined that no subsequent events occurred that were reasonably expected to impact the consolidated condensed financial statements presented herein.

ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of the financial condition and results of operations of Charlie’s Holdings, Inc. should be read in conjunction with the financial statements and the notes to those statements appearing elsewhere in this Quarterly Report on Form 10-Q (this “Report”) and without audited financial statements and other information presented in our Annual Report on Form 10-K for the year ended December 31, 2023 (the “2023 Annual Report”). Some of the information contained in this discussion and analysis or set forth elsewhere in this Report, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. Such forward-looking statements are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those discussed below and elsewhere in this Report, and in our other filings with the Securities and Exchange Commission (“SEC”), including particularly matters set forth under Part I, Item 1A (Risk Factors) of the 2023 Annual Report. Furthermore, such forward-looking statements speak only as of the date of this Report. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements.

As used in this Report, unless otherwise stated or the context otherwise requires, references to the “Company”, “we”, “us”, “our”, or similar references mean Charlie’s Holdings, Inc., its subsidiaries and consolidated variable interest entity on a consolidated basis.

Overview

The Company’s objective is to become a leader in two broad product categories: (i) non-combustible nicotine-related products, and (ii) alternative alkaloid vapor products. Through our Charlie’s subsidiary, we formulate, market, and distribute premium, nicotine-based and alternative alkaloid vapor products. Charlie’s products are produced through contract manufacturers for sale through select distributors, specialty retailers, and third-party online resellers throughout the United States and in select international markets.

Operational Plan

Considering industry-specific hurdles, as well as the potential for future regulatory changes, management has targeted opportunities for growth and has adopted the following operational plan.

Priority 1: Over the last two years, we initiated a plan and began to invest substantial time and resources to develop various proprietary products and new technologies in order to achieve competitive advantages in the vapor and alternative products marketplace. In conjunction with internal and external research and development resources, we endeavored to identify a nicotine substitute (“Metatine™”) to be used in lieu of tobacco-based and synthetically derived nicotine. We believe adult consumers will enjoy Metatine vapor products in much the same way that they enjoy traditional vapor products. However, because Metatine is not made or derived from tobacco, and because Metatine does not consist of or contain nicotine from any source, the FDA's Center for Tobacco Products does not have jurisdiction to regulate Metatine. Accordingly, if the Company is successful utilizing Metatine in a viable commercial product, such a product would allow us additional flexibility in offering both flavored and non-flavored vapor products to adult consumers looking to transition away from traditional combustible and smokeless tobacco products.

With the advent of our nicotine substitute Metatine, we plan to continue developing product formats that offer adult consumers a satisfying alternative to traditional nicotine products. The SPREE BAR™ line of vapor products launched in late 2023 and is now offered for sale by several master distributors across the United States. We have recently begun test-marketing Metatine-based e-liquids under the PACHAMAMA PLUS+ trademark and we are developing a second-generation Metatine-based disposable device for launch in Q4 2024. In response to the rapidly emerging new “pouch products” category in the nicotine products industry, we are also developing a Metatine-based pouch line that could be ready for market as soon as January 2025. We recognize the challenges in marketing non-nicotine-based products in a market saturated with traditional nicotine products; accordingly, we are committed to continuous improvement of our alternative alkaloid products in order to satisfy adult consumers’ demands.

Priority 2: Since our founding in 2014, Charlie’s has created literally hundreds of products that provide adult smokers with a viable means of abandoning cigarettes. Not coincidentally, over the last 10-15 years e-cigarette usage in the United States has grown significantly, and cigarette smoking rates have dropped. Accordingly, tobacco and synthetically derived nicotine vapor products continue to provide significant growth opportunities for Charlie’s. In 2021, we launched our synthetic nicotine (not derived from tobacco) Pacha (formerly Pachamama Disposable) product line, which provides access to additional sales channels and broadens our customer base. These innovative product formats continue to represent an extremely important product category for Charlie’s and we intend develop new distribution partnerships in order to grow our nicotine disposable business in 2025.

To date, Charlie’s has invested more than $6 million on the submission of Premarket Tobacco Applications (“PMTAs”) and subsequent amendments to these applications to the FDA. We engaged a team of more than 200 professionals, including doctors, scientists, biostatisticians, data analysts, and numerous contract research organizations to create Charlie’s comprehensive PMTA submissions. Notwithstanding Charlie’s meaningful and costly regulatory initiatives – and despite the fact that hundreds of other companies across the United States invested hundreds of millions of dollars to submit more than 26 million PMTAs – to date, the FDA has only authorized 34 tobacco-flavored e-cigarette products and devices. Accordingly, even though former FDA Commissioner Dr. Scott Gottlieb described e-cigarettes as far lower on the “continuum of risk” than combustible cigarettes, fewer than 1% of the PMTA’s for e-cigarette products and devices have survived FDA’s regulatory gauntlet.

Nonetheless, we are continuing to seek FDA marketing authorization for certain of both our nicotine vapor products and our synthetic nicotine vapor products. Obtaining one or more marketing orders from the FDA could, we believe, could help to remediate perceived health issues related to vaping, and further position the Company as a trusted, industry leader.

Priority 3: The Company has begun to develop intellectual property around technologies designed to prevent youth access to nicotine vapor products. Edward Carmines, Ph.D., a member of Charlie’s Board of Directors and an accomplished scientist and regulatory affairs expert, is spearheading Charlie's development of patented "age-gating technology" for both Charlie's and potential licensees of the Company. Currently, there is a need for age-gated product technologies that can satisfy or accommodate concerns the FDA has related to under-age youth access in the ENDS market. If our age-gated e-cigarettes-in-development are recognized as "products of merit" by the FDA, Charlie's e-cigarettes could emerge among the select minority of flavored nicotine disposables able to be sold legally in the $8 billion U.S. vapor products market.

Underlining the importance of Charlie’s work with age-gating technology are initiatives taken by JUUL Labs, Altria, and R.J. Reynolds, three of the largest competitors in our industry. In July 2023 JUUL announced that it had submitted a PMTA with the FDA for a new e-cigarette device that also included information on novel, data-driven technologies to restrict underage access. JUUL’s chief product officer explained, “With our next-generation platform, we have designed a technological solution for two public-health problems: improving adult-smoker switching from combustible cigarettes and restricting underage access to vapor products...” In the second quarter of 2024, Altria and R.J. Reynolds announced news of their own PMTA submissions to the FDA for mobile applications that verify consumers’ ages through third-party age verification providers. Similar to the age-gating technology under development at Charlie’s, the Big Tobacco company devices include mobile and web-based apps that enable age-verification technology, including device-locking, and real-time product information and usage insights for age-verified consumers with industry-leading data-privacy protections.

Priority 4: In order to mitigate FDA regulatory risk in the domestic market and to capture what management continues to believe is a significant commercial opportunity, we have dedicated additional resources to efforts focused on growing our market share internationally. Presently, approximately 16% of our vapor product sales come from the international market and we are well positioned to increase sales in countries where we already have presence and, in additional overseas markets, as we have already built an international distribution platform.

Risks and Uncertainties and Ability to Continue as a Going Concern

The Company operates in an environment that is subject to rapid changes and developments in laws and regulations that could have a significant impact on the Company’s ability to sell its products. Beginning in September 2019, certain states temporarily banned the sale of flavored e-cigarettes, and several states and municipalities are considering implementing similar restrictions. Federal, state, and local governmental bodies across the United States have indicated that flavored e-cigarette liquid, vaporization products and certain other consumption accessories may become subject to new laws and regulations at the federal, state, and local levels. In addition, in June 2022, the FDA announced a plan to reduce nicotine levels in cigarettes to minimally or non-addictive levels. The application of any new laws or regulations that may be adopted in the future, at a federal, state, or local level, directly or indirectly implicating nicotine, flavored e-cigarette liquid, and other electronic nicotine delivery system (“ENDS”) products, could significantly limit the Company’s ability to sell such products, result in additional compliance expenses, and/or require the Company to change its labeling and/or methods of distribution. Any ban of the sale of flavored e-cigarettes directly limits the markets in which the Company may sell its products. In the event the prevalence of such bans and/or changes in laws and regulations increase across the United States, or internationally, the Company’s business, results of operations, and financial condition could be adversely impacted. In addition, the Company is presently seeking to obtain marketing authorization for certain of its tobacco-derived nicotine e-liquid products. The Company’s applications were submitted in September 2020 on a timely basis, which if approved, will allow the Company to continue to sell its approved products in the United States. Beginning in August 2021, the FDA began issuing Marketing Denial Orders (“MDO”) for ENDS products that lack evidence to demonstrate that permitting the marketing of such products would be appropriate for the protection of the public health. The Company has not received an MDO for any of its 2020 PMTA submissions; however, there is no assurance that regulatory approval to sell our products will be granted or that we would be able to raise additional financing if required, which could have a significant impact on our sales. On March 15, 2022, a new rider to the Federal Food, Drug and Cosmetic Act was passed granting the FDA authority over synthetic nicotine. These regulations make the Company’s synthetic nicotine products subject to the same FDA rules as tobacco-derived nicotine products. As such, the Company was required to file a PMTA for its existing synthetic nicotine products marketed under the Pacha brands by May 14, 2022 or be subject to FDA enforcement. The Company filed new PMTAs, for its synthetic Pacha products on May 13, 2022, prior to the May 14, 2022 deadline. On November 3, 2022, FDA accepted for scientific review certain of our PMTAs for synthetic nicotine products and, on November 4, 2022, FDA refused to accept certain other PMTAs for these products, rendering the latter products subject to FDA enforcement. The Company submitted an administrative appeal with FDA regarding its refusal to accept certain of the PMTAs. The administrative appeal was granted on October 30, 2023 and the products were accepted to move forward in the PMTA review process. The Company continues to sell the affected synthetic nicotine products while the PMTA review process continues. The FDA may bring an enforcement action against our synthetic nicotine products for lack of premarket authorization and/or issue an MDO to our pending applications at any time. More generally, FDA’s regulatory initiatives and enforcement priorities regarding ENDS products are unpredictable and continue to evolve, and we cannot predict whether FDA’s priorities and review of our premarket submissions will impact our products to a greater degree than our competitors in the industry. In the event the FDA denies our PMTAs, we would be required to remove products and cease selling them.

The Company recently launched new disposable vape products, under the “SPREE BAR™” brand, that the Company expects will (i) replace most of its legacy products and (ii) become the single largest, most important commercial opportunity in Charlie’s history. The Company and its attorneys believe SPREE BAR products are not subject to FDA review. Based on the information provided by the Company’s contracted chemical suppliers and its consultants, the proprietary Metatine™ (patented in the United States and in China by the Company’s chemical supplier) in the Company’s SPREE BAR products does not meet the definition of nicotine set forth in 21 U.S.C. § 387(12) and therefore its products containing Metatine, as their active ingredient, are not subject to regulation as “tobacco products” under 21 U.S.C. § 321(rr). Further, according to information provided by the Company’s chemists, the other ingredients in the Company’s SPREE BAR vape liquid are not made or derived from tobacco, nor do they contain nicotine from any source. The documentary support for these facts, including a Certificate of Analysis (COA) for the Metatine used in the Company’s SPREE BAR products, corroborates these conclusions. However, should any of these understandings be incorrect, the Company’s position on Metatine not qualifying as a “tobacco product” would need to be revisited. Further, should Congress bestow regulatory control over Metatine to the FDA, or should the FDA deem Metatine disposable vape devices “tobacco products” despite the facts that Metatine is not a salt or complex of nicotine, and is not itself derived from nicotine or tobacco, SPREE BAR products might then be subject to the FDA tobacco requirements, including, but not limited to, the requirement that all newly deemed tobacco products obtain premarket authorization before entering the U.S. market. If this were to happen, the FDA could bring an enforcement action against our Metatine products for lack of premarket authorization. More generally, FDA’s regulatory initiatives and enforcement authority regarding our products are unpredictable and continue to evolve and we cannot predict whether FDA’s priorities and/or potential jurisdiction over our products will require us to remove our products from the market and to cease selling them.

As discussed below, our financial statements and working capital raise substantial doubt about the Company’s ability to continue as a going concern. Our financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. See Liquidity and Capital Resources below for additional information.

Recent Developments

Expiration of Warrants

On April 26, 2024, the Investor Warrants and Placement Agent Warrants expired without being exercised.

January 2024 Note Financing

May 2024 Capital Raise

On May 31, 2024, the Company entered into subscription agreements with investors for the sale of an aggregate of 20,375,000 shares of its common stock, par value $0.001 per share, at a purchase price per share of $0.08 (the “Offering”). The Offering generated gross proceeds of approximately $1.6 million, which will be used for working capital purposes. The Offering was undertaken in reliance on Section 4(a)(2) under the Securities Act of 1933, as amended, as a transaction not involving a public offering.

Results of Operations for the Three Months Ended June 30, 2024 Compared to the Three Months Ended June 30, 2023

Regarding results from operations for the quarter ended June 30, 2024, we generated revenue of approximately $2,043,000, as compared to revenue of $3,970,000 for the three months ended June 30, 2023. This $1,927,000 decrease in revenue was due primarily to a $1,278,000 decrease in sales of our nicotine-based vapor products, as well as a $649,000 decrease in sales of our hemp-derived products.

We generated a net loss for the three months ended June 30, 2024, of approximately $967,000 as compared to a net income of $32,000 for the three months ended June 30, 2023. The net loss for the three months ended June 30, 2024 includes a non-cash gain in fair value of derivative liabilities of $0 compared to a non-cash gain in fair value of derivative liabilities of $185,000 during the three months ended June 30, 2023.

A review of the three-month period ended June 30, 2024, follows:

	For the three months ended
	June 30,						Change
	2024			2023			Amount			Percentage
*($ in thousands)*
Revenues:
Product revenue, net	$	2,043		$	3,970		$	(1,927	)		-48.5	%
Total revenues		2,043			3,970			(1,927	)		-48.5	%
Operating costs and expenses:
Cost of goods sold - product revenue		1,265			1,879			(614	)		-32.7	%
General and administrative		1,423			1,775			(352	)		-19.8	%
Sales and marketing		117			319			(202	)		-63.3	%
Research and development		(26	)		39			(65	)		-166.7	%
Total operating costs and expenses		2,779			4,012			(1,233	)		-30.7	%
Loss from operations		(736	)		(42	)		(694	)		1652.4	%
Other income (expense):
Interest expense		(156	)		(111	)		(45	)		40.5	%
Debt extinguishment loss		(75	)		-			(75	)		100	%
Change in fair value of derivative liabilities		-			185			(185	)		-100.0	%
Total other (loss) income		(231	)		74			(305	)		-412.2	%
Net (loss) income	$	(967	)	$	32		$	(999	)		-3121.9	%

Revenue

Revenue for the three months ended June 30, 2024, decreased by approximately $1,927,000 or 48.5%, to approximately $2,043,000, as compared to approximately $3,970,000 for same period in 2023 due to a $1,278,000 decrease in sales of our nicotine-based vapor products, and a $649,000 decrease in sales of our hemp-derived products. The decrease in our nicotine-based vapor product sales was primarily driven by decreased sales of our Pacha Disposable line as well as periodic stockouts of our e-liquid products. The launch of the Company’s SPREE BAR line of nicotine substitute vapor products required enhanced focus and resource allocation in order to support sales and marketing efforts, which ultimately affected the sales performance of other product categories. SPREE BAR sales have been inconsistent since being launched in late 2023 which has caused a gap in overall sales production.

The decrease in sales for our hemp-derived business during the period was directly related to the diversion of working capital and other resources towards the ramp up of our SPREE BAR line of nicotine substitute vapor products. Despite achieving increased market share for our PINWEEL brand of hemp-derived products, we believe that the market for nicotine and alternative alkaloid products, such as SPREE BAR, offers the Company the most significant opportunity for growth.

Cost of Revenue

Cost of revenue, which consists of direct costs of materials, direct labor, third party subcontractor services, and other overhead costs decreased by approximately $614,000 or 32.7%, to approximately $1,265,000, or 61.9% of revenue, for the three months ended June 30, 2024, as compared to approximately $1,879,000, or 47.3% of revenue, for the same period in 2023. This cost, as a percent of revenue, increased compared to last year due to a high sales mix of SPREE BAR products which contain a higher per unit cost relative to sales. Lower overhead cost absorption also contributed to a higher cost of revenue as a percent of sales.

General and Administrative Expenses

For the three months ended June 30, 2024, total general and administrative expenses decreased by approximately $352,000 to $1,423,000 as compared to approximately $1,775,000 for the same period in 2023. This change was primarily due to decreases of approximately $165,000 in non-commission payroll and benefits costs, $69,000 in certain professional fees, and approximately $118,000 in other general and administrative expenses. The decrease in payroll and benefits costs was primarily driven by elective salary reductions for executives and a reduced bonus accrual. Decreased professional fees resulted from reduced legal, accounting and other consulting services during the period. The reduction in other general and administrative expenses largely consisted of decreased information systems expenses and merchant service fees, which vary directly with sales activity.

Sales and Marketing Expense

For the three months ended June 30, 2024, total sales and marketing expense decreased by approximately $202,000 to approximately $117,000 as compared to approximately $319,000 for the same period in 2023, which was primarily due to reduced marketing and commission costs during the period.

Research and Development Expense

For the three months ended June 30, 2024, we had income from research and development of approximately $26,000 as compared to an expense of $39,000 for the same period in 2023. The decrease of approximately $65,000 was primarily due to a vendor refund of approximately $26,000.

Loss from Operations

We incurred a loss from operations of approximately $736,000 for the three months ended June 30, 2024, compared to loss of approximately $42,000 for the three months ended June 30, 2023, due primarily to lower sales and gross profit. We also incurred certain non-cash, general and administrative expenses during the period including a $56,000 expense related to stock-based compensation. Net loss is determined by adjusting loss from operations by the following items:

●

Interest Expense. For the three months ended June 30, 2024, and 2023, we recorded approximately $103,000 and $7,000 of related party interest expense. For the same periods, we recorded total interest expense related to notes payable of $156,000 and $111,000, respectively. The increase was primarily due to $700,000 of notes payable that were entered in July 2023, which bear interest at twenty-one percent (21%) per annum.

●

Debt Extinguishment Loss. For the three months ended June 30, 2024, we recorded approximately $75,000 of loss from debt extinguishment, which was related to our May 2024 Capital Raise (see Note 10).

Net Loss

For the three months ended June 30, 2024, we incurred a net loss of $967,000 as compared to net income of $32,000 for the same period in 2023.

Results of Operations for the Six Months Ended June 30, 2024 Compared to the Six Months Ended June 30, 2023

Regarding results from operations for the six months ended June 30, 2024, we generated revenue of approximately $5,094,000, as compared to revenue of $8,000,000 for the six months ended June 30, 2023. This $2,906,000 decrease in revenue was due primarily to a $1,935,000 decrease in sales of our nicotine-based vapor products, as well as a $971,000 decrease in sales of our hemp-derived products.

We generated a net loss for the six months ended June 30, 2024, of approximately $2,012,000 as compared to a net loss of $1,358,000 for the six months ended June 30, 2023. The net loss for the six months ended June 30, 2024 includes a non-cash gain in fair value of derivative liabilities of $79,000 compared to a non-cash gain in fair value of derivative liabilities of $408,000 during the six months ended June 30, 2023.

A review of the six months ended June 30, 2024, follows:

	For the six months ended
	June 30,						Change
	2024			2023			Amount			Percentage
*($ in thousands)*
Revenues:
Product revenue, net	$	5,094		$	8,000		$	(2,906	)		-36.3	%
Total revenues		5,094			8,000			(2,906	)		-36.3	%
Operating costs and expenses:
Cost of goods sold - product revenue		3,372			5,018			(1,646	)		-32.8	%
General and administrative		2,968			3,763			(795	)		-21.1	%
Sales and marketing		451			687			(236	)		-34.4	%
Research and development		(20	)		91			(111	)		-122.0	%
Total operating costs and expenses		6,771			9,559			(2,788	)		-29.2	%
Loss from operations		(1,677	)		(1,559	)		(118	)		7.6	%
Other income (expense):
Interest expense		(339	)		(242	)		(97	)		40.1	%
Debt extinguishment (loss) gain		(75	)		35			(110	)		-314.3	%
Change in fair value of derivative liabilities		79			408			(329	)		-80.6	%
Total other (loss) income		(335	)		201			(536	)		-266.7	%
Net loss	$	(2,012	)	$	(1,358	)	$	(654	)		48.2	%

Revenue

Revenue for the six months ended June 30, 2024, decreased by approximately $2,906,000 or 36.3%, to approximately $5,094,000, as compared to approximately $8,000,000 for same period in 2023 due to a $1,935,000 decrease in sales of our nicotine-based vapor products, and a $971,000 decrease in sales of our hemp-derived products. The decrease in our nicotine-based vapor product sales was primarily driven by decreased sales of our Pacha Disposable line as well as periodic stockouts of our e-liquid products. The launch of the Company’s SPREE BAR line of nicotine substitute vapor products required enhanced focus and resource allocation in order to support sales and marketing efforts, which ultimately affected the sales performance of other product categories.

Cost of Revenue

Cost of revenue, which consists of direct costs of materials, direct labor, third party subcontractor services, and other overhead costs decreased by approximately $1,646,000 or 32.8%, to approximately $3,372,000, or 66.2% of revenue, for the six months ended June 30, 2024, as compared to approximately $5,018,000, or 62.7% of revenue, for the same period in 2023. This cost, as a percent of revenue, increased compared to last year due to a high sales mix of SPREE BAR products which contain a higher per unit cost relative to sales. Lower overhead cost absorption also contributed to a higher cost of revenue as a percent of sales.

General and Administrative Expenses

For the six months ended June 30, 2024, total general and administrative expenses decreased by approximately $795,000 to $2,968,000 as compared to approximately $3,763,000 for the same period in 2023. This change was primarily due to decreases of approximately $410,000 in non-commission payroll and benefits costs, $112,000 in professional fees, $80,000 in information systems costs and approximately $193,000 in other general and administrative expenses. The decrease in payroll and benefits costs was primarily driven by elective salary reductions for executives and a reduced bonus accrual. Decreased professional fees resulted from reduced legal, accounting and other consulting services during the period. The decrease in information systems resulted from reduced software licenses and system support. The reduction in other general and administrative expenses largely consisted of decreased merchant processing fees and bad debt expense, both of which vary with sales.

Sales and Marketing Expense

For the six months ended June 30, 2024, total sales and marketing expense decreased by approximately $236,000 to approximately $451,000 as compared to approximately $687,000 for the same period in 2023, which was primarily due to reduced marketing and commission costs during the period.

Research and Development Expense

For the six months ended June 30, 2024, we had income from research and development of approximately $20,000 as compared to an expense of $91,000 for the same period in 2023. The decrease of approximately $111,000 was primarily due to reduced costs associated with the development of new technologies and product formats as well as a vendor refund of approximately $26,000.

Loss from Operations

We incurred a loss from operations of approximately $1,677,000 for the six months ended June 30, 2024, compared to loss of approximately $1,559,000 for the six months ended June 30, 2023, due primarily to lower sales and gross profit. We also incurred certain non-cash, general and administrative expenses during the period including a $117,000 expense related to stock-based compensation. Net loss is determined by adjusting loss from operations by the following items:

●

Change in Fair Value of Derivative Liabilities. For the six months ended June 30, 2024, the gain in fair value of derivative liabilities was $79,000, compared to a gain in fair value of derivative liabilities of $408,000 for the six months ended June 30, 2023. The derivative liability is associated with the Investor Warrants and the Placement Agent Warrants (as defined in Note 3 of this Report) in connection with the Share Exchange. The gain for the six months ended June 30, 2024 was due to the expiration of the warrants in April 2024 which resulted in the warrant liability being written off.

●

Interest Expense. For the six months ended June 30, 2024, and 2023, we recorded approximately $200,000 and $15,000 of related party interest expense. For the same periods, we recorded total interest expense related to notes payable of $339,000 and $242,000, respectively. The increase was primarily due to $700,000 of notes payable that were entered in July 2023, which bear interest at twenty-one percent (21%) per annum.

●

Debt Extinguishment Loss. For the six months ended June 30, 2024, we recorded approximately $75,000 of loss from debt extinguishment, which was related to our May 2024 Capital Raise (see Note 10).

Net Loss

For six months ended June 30, 2024, we incurred a net loss of $2,012,000 as compared to a net loss of $1,358,000 for the same period in 2023.

Liquidity and Capital Resources

As of June 30, 2024, we had working capital deficit of approximately $557,000, which consisted of current assets of approximately $4,816,000 and current liabilities of approximately $5,373,000, as compared to working capital of approximately $332,000 at December 31, 2023. The current liabilities include approximately $3,016,000 of accounts payable and accrued expenses, notes payable of $382,000, notes payable from related parties of $1,514,000, approximately $238,000 of deferred revenue associated with product shipped but not yet received by customers, and approximately $223,000 of current lease liabilities.

Our cash and cash equivalents balance at June 30, 2024 was approximately $1,085,000. As of June 30, 2024, we have the following notes outstanding:

●

July 2023 Note Financing. Between July 17, 2023 and August 1, 2023, the Company issued unsecured promissory notes (the “Notes”) to several of its executives and employees, Ryan Stump, Henry Sicignano III, Keith Stump, and Jessica Greenwald, and to three of its largest stockholders, Brandon Stump, Red Beard Holdings LLC, and Michael King (the “Lenders"), in the cumulative principal amount of $1,400,000. Notes shall bear interest at twenty-one percent (21%) per annum and have maturity dates ranging from November 17, 2023 to December 10, 2023. As of June 30, 2024, $400,000 remained outstanding and the maturity dates of the outstanding notes have been extended to October 16, 2024.

●

April 2022 Note Financing. On April 6, 2022, the Company issued a secured promissory note (the “Note”) to one of its individual stockholders, and a member of the Company’s Board of Directors since June 13, 2023, Michael King (the ”Lender"), in the principal amount of $1,000,000, which Note is secured by accounts receivable of the Company pursuant to the terms of a Security Agreement entered into by and between the Company and the Lender (the "Note Financing"). The Note initially required the payment of principal in full and guaranteed interest in an amount the greater of 18% per annum, or $90,000, on or before the earlier date of (i) a Liquidity Event, as defined under the terms of the Note; or (ii) September 28, 2022. On September 28, 2022, the Company and the Lender entered into a modification to the Note to extend the maturity date to March 28, 2023 and the Company paid all accrued interest under the Note through such date.

On March 28, 2023, the Company entered into a second modification to the Note to extend the maturity date to April 28, 2024, contingent upon the payment of all interest accrued under the Note through March 28, 2023 and certain other modifications to the Note. Principal shall be payable onthe 28th day of each month in installments of $25,000, commencing April 28, 2023, continuing up to and including April 28, 2024 whereby a balloon payment for the remaining principal balance will be paid. Immediately following the second modification, the Company entered into a third modification agreement to further extend the maturity date to March 28, 2025. The third modification agreement was effective on March 28, 2023 and superseded the second modification. Interest shall accrue on the aggregate outstanding principal amount at a rate equal to 20% simple interest per annum and shall be payable on the same day as installments of principal are payable. The Company may prepay all or any portion of the principal amount, together with all accrued but unpaid interest thereon, at any time without premium or penalty. All outstanding principal and interest are due earlier of March 28, 2025, or a liquidity event. The third modification was recognized as a debt extinguishment, resulting in a gain on debt extinguishment of approximately $35,000. The Company used the proceeds from the Note for general corporate purposes, and its working capital requirements, pending the availability of alternative debt financing. As of June 30, 2024, approximately $827,000 of principal remained outstanding

●

August 2022 Note Financing. On August 17, 2022, the Company and its Chief Operating Officer and Director, Ryan Stump (the "Stump Lender") entered into a loan agreement (the “Loan”) in the principal amount of $300,000. The Loan will be due in full in 120 days or sooner if, before the end of term, the Company secures (i) new debt financing or (ii) sufficient PMTA strategic partnership funds. The Loan bears an annual interest rate of 10%. The Company also incurred an additional $3,000 issuance cost resulting from the payment of the Stump Lender’s legal fees. On April 15, 2024 the Company and Stump Lender entered into a fifth modification to the Loan to extend the maturity date to August 21, 2024.

●

December 2023 Receivables Financing. On December 13, 2023 the Company entered into a second future receivables sale agreement (“Second Receivables Financing” or “Receivables Financing Agreement”) with Austin Business Finance (“Austin Purchaser”) by which Austin Purchaser purchases from the Company, its future accounts and contract rights arising from the sale of goods or rendition of services to the Company’s customers. The purchase price, as defined by the Second Receivables Financing Agreement, was $750,000 which was paid to the Company on December 13, 2023, net of a 3% origination fee. The Second Receivables Financing Agreement requires fifty-two equal payments of $17,740 to be paid weekly for a total repayment of $922,500 over the term of the agreement.

For the six months ended June 30, 2024, net cash used in operating activities was approximately $300,000, resulting from a net loss of $2,012,000, offset by a change in operating assets and liabilities of $1,181,000 and net non-cash activity of $531,000. For the six months ended June 30, 2023, net cash provided by operating activities was approximately $124,000, resulting from a net loss of $1,358,000, offset by a change in operating assets and liabilities of $1,364,000 and net non-cash activity of $118,000.

For the six months ended June 30, 2024, we generated approximately $1,018,000 in cash from financing activities related to the issuance of common shares of $1,030,000, notes payable to a related party of $500,000 and the repayment of $512,000 in notes payable, including $50,000 to a related party.

Substantial Doubt to Continue as a Going Concern Regarding the Legal and Regulatory Environment, Liquidity and Management’s Plan of Operation

Our consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company operates in a rapidly changing legal and regulatory environment; new laws and regulations or changes to existing laws and regulations could significantly limit the Company’s ability to sell its products, and/or result in additional costs. Additionally, the Company was required to apply for FDA approval to continue selling and marketing its products used for the vaporization of nicotine in the United States. Currently, a substantial portion of the Company’s sales are derived from products that are subject to approval by the FDA. There was a significant cost associated with the application process and there can be no assurance the FDA will approve previous and/or future applications. For the six months ended June 30, 2024, the Company’s revenue declined, the Company generated a loss from operations of approximately $1,677,000, and a consolidated net loss of approximately $2,012,000. Cash used in operations was approximately $300,000. The Company had a stockholders’ deficit of $296,000 at June 30, 2024. During the six months ended June 30, 2024, the Company’s working capital position decreased to a deficit of $557,000 from $332,000 as of December 31, 2023. Considering these facts, the issuance of one or several Marketing Denial Orders ("MDOs”) from the FDA would increase the potential for inventory obsolescence and uncollectable accounts receivables and the removal of certain products for sale. These regulatory risks, as well as other industry-specific challenges and our low working capital and cash position, remain factors that raise substantial doubt about the Company’s ability to continue as a going concern.

Our plans and growth depend on our ability to increase revenues, procure cost-effective financing, and continue our business development efforts, including cumulative expenditures of approximately $6,000,000 as of June 30, 2024, to support our PMTA process for the Company’s submissions to the FDA. The Company has undergone cost-cutting measures including salary reductions of up to 25% for officers and certain managers and a reduction in headcount for certain departments. During the fourth quarter of 2023, the Company launched SPREE BAR, a non-nicotine, disposable vapor product which is not subject to FDA review or covered under the Agriculture Improvement Act (the “Farm Bill”). The Company may require additional financing in the future to support the development of new product categories as well as subsequent PMTA filings, and/or in the event the FDA requests additional testing for one, or several, of the Company’s prior PMTA submissions. There can be no assurance that additional financing will be available on acceptable terms, or at all, and there can be no assurance that any such arrangement, if required or otherwise sought, would be available on terms deemed to be commercially acceptable and, in the Company’s best interests. The financial statements do not include any adjustments to the carrying amount and classification of recorded assets and liabilities should the Company be unable to continue operations. If we do not have sufficient funds to continue operations, we could be required to seek bankruptcy protection or other alternatives that would likely result in our stockholders losing some or all their investment in us.

Off-Balance Sheet Arrangements

The Company has no off-balance sheet arrangements other than operating lease commitments.

Critical Accounting Policies

The condensed consolidated financial statements are prepared in conformity with U.S. GAAP, which require the use of estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities at the date of the financial statements, and the reported amounts of expense in the periods presented. We believe that the accounting estimates employed are appropriate and resulting balances are reasonable; however, due to inherent uncertainties in making estimates, actual results could differ from the original estimates, requiring adjustments to these balances in future periods. The critical accounting estimates that affect the consolidated financial statements and the judgments and assumptions used are consistent with those described under Part II, Item 7 of our Annual Report on the 2023 Annual Report.

ITEM 3 – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 4 – CONTROLS AND PROCEDURES

(a) Evaluation of disclosure controls and procedures

Our management, with the participation of our President and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) as of the end of the period covered by this Report. In designing and evaluating the disclosure controls and procedures, 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. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

Based on our evaluation, our President, the principal executive officer, and Chief Financial Officer concluded that, as of June 30, 2024, our disclosure controls and procedures are designed at a reasonable assurance level and are effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our President and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

(b) Changes in internal control over financial reporting

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15 of the Exchange Act that occurred during the quarter ended June 30, 2024, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

As of the date hereof, we are not a party to any material legal or administrative proceedings. There are no proceedings in which any of our directors, executive officers or affiliates, or any registered or beneficial stockholder, is an adverse party or has a material interest adverse to our interest. From time to time, the Company may be involved in various claims and counterclaims and legal actions arising in the ordinary course of business. Litigation or any other legal or administrative proceeding, regardless of the outcome, is likely to result in substantial cost and diversion of our resources, including our management’s time and attention.

ITEM 1A. RISK FACTORS

Our results of operations and financial condition are subject to numerous risks and uncertainties described in the 2023 Annual Report. In addition to the other information set forth in this Report, you should carefully consider the risk factors discussed in Part 1, Item 1A, of the 2023 Annual Report and subsequent reports filed pursuant to the Exchange Act which could materially and adversely affect the Company’s business, financial condition, results of operations, and stock price. Any losses or damages we incur could have a material adverse effect on our financial results and our ability to conduct business as expected. The risks described in our 2023 Annual Report and in our subsequent reports filed pursuant to the Exchange Act are not the only risks facing the Company. Additional risks and uncertainties not presently known to management, or that management presently believes not to be material, may also result in material and adverse effects on our business, financial condition, and results of operations.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

On May 31, 2024, the Company entered into subscription agreements with investors for the sale of an aggregate of 20,375,000 shares of its common stock, par value $0.001 per share, at a purchase price per share of $0.08 (the “Offering”). The Offering generated gross proceeds of approximately $1.63 million, which will be used for working capital purposes. The Offering was undertaken in reliance on Section 4(a)(2) under the Securities Act of 1933, as amended, as a transaction not involving a public offering.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

During the quarter ended June 30, 2024, no director or Section 16 Officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

ITEM 6. EXHIBITS

(a)		Exhibits
31.1		Certification of the Principal Executive Officer pursuant to Rule 13a-14(a) and 15d-14(a).
31.2		Certification of the Principal Financial and Accounting Officer pursuant to Rule 13a-14(a) and 15d-14(a).
32.1		Certification by the Principal Executive Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2		Certification by the Principal Financial and Accounting Officer pursuant to 18 U.S.C. 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (embedded within the Inline XBRL Document and include in Exhibit 101)

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: August 19, 2024	CHARLIE’S HOLDINGS, INC.

	By:	/s/ Henry Sicignano, III
		Henry Sicignano, III
		President
		(Principal Executive Officer)

	By:	/s/ Matthew P. Montesano
		Matthew P. Montesano
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

EXHIBIT 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

I, Henry Sicignano, III, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Charlie’s Holdings, Inc.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report.

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Henry Sicignano, III

Date: August 19, 2024

Henry Sicignano, III

President

(Principal Executive Officer)

EXHIBIT 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Matthew P. Montesano, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Charlie’s Holdings, Inc.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report.

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Matthew P. Montesano

Date: August 19, 2024

Matthew P. Montesano

Chief Financial Officer

(Principal Financial and Accounting Officer)

EXHIBIT 32.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Charlie’s Holdings, Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Henry Sicignano, III, President of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

	/s/ Henry Sicignano, III
	Henry Sicignano, III
	President (Principal Executive Officer)

Date: August 19, 2024

EXHIBIT 32.2

CERTIFICATION OF PRINCIPAL ACCOUNTING OFFICER PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Charlie’s Holdings, Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Matthew P. Montesano, Principal Accounting Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

	/s/ Matthew P. Montesano
	Matthew P. Montesano
	Chief Financial Officer (Principal Financial and Accounting Officer)

Date: August 19, 2024

Document And Entity Information - shares	6 Months Ended
Document And Entity Information - shares	Jun. 30, 2024	Aug. 19, 2024
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2024
Document Transition Report	false
Entity File Number	001-32420
Entity Registrant Name	CHARLIE’S HOLDINGS, INC.
Entity Incorporation, State or Country Code	NV
Entity Tax Identification Number	84-1575085
Entity Address, Address Line One	1007 Brioso Drive
Entity Address, City or Town	Costa Mesa
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92627
City Area Code	949
Local Phone Number	531-6855
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding (in shares)		229,227,388
Entity Central Index Key	0001134765
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q2
Amendment Flag	false

Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($)	Jun. 30, 2024	Dec. 31, 2023
Cash	$ 1,085,000	$ 367,000
Accounts receivable, net	332,000	289,000
Inventories, net	3,203,000	3,826,000
Prepaid expenses and other current assets	196,000	604,000
Total current assets	4,816,000	5,086,000
Property, plant and equipment, net	91,000	157,000
Right-of-use asset, net	219,000	424,000
Other assets	101,000	101,000
Total non-current assets	411,000	682,000
TOTAL ASSETS	5,227,000	5,768,000
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
Accounts payable and accrued expenses	3,016,000	2,846,000
Derivative liability	0	79,000
Lease liabilities	223,000	355,000
Deferred revenue	238,000	58,000
Total current liabilities	5,373,000	4,754,000
Lease liabilities, net of current portion	0	73,000
Total non-current liabilities	150,000	1,121,000
Total liabilities	5,523,000	5,875,000
Commitments and Contingencies
Common stock ($0.001 par value); 500,000,000 shares authorized; 249,602,388 and 228,535,886 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively	250,000	229,000
Additional paid-in capital	10,006,000	8,204,000
Accumulated deficit	(10,552,000)	(8,540,000)
Total stockholders' equity	(296,000)	(107,000)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 5,227,000	$ 5,768,000
Series A Preferred Stock [Member]
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
Preferred Stock, Shares Issued (in shares)	126,680	128,181
Preferred stock	$ 0	$ 0
Series B Preferred Stock [Member]
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
Preferred Stock, Shares Issued (in shares)	0	0
Preferred stock	$ 0	$ 0
Nonrelated Party [Member]
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
Notes payable, net	382,000	716,000
Notes payable, net of current portion	150,000	150,000
Related Party [Member]
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
Notes payable, net	1,514,000	700,000
Notes payable, net of current portion	$ 0	$ 898,000

Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - $ / shares	Jun. 30, 2024	Dec. 31, 2023
Preferred Stock, Par or Stated Value Per Share (in dollars per share)	$ 0.001	$ 0.001
Preferred Stock, Shares Authorized (in shares)	1,800,000	1,800,000
Common Stock, Par or Stated Value Per Share (in dollars per share)	$ 0.001	$ 0.001
Common Stock, Shares Authorized (in shares)	500,000,000	500,000,000
Common Stock, Shares, Issued (in shares)	249,602,388	228,535,886
Common Stock, Shares, Outstanding (in shares)	249,602,388	228,535,886
Series A Preferred Stock [Member]
Preferred Stock, Shares Authorized (in shares)	300,000	300,000
Preferred Stock, Shares Outstanding (in shares)	126,680	128,181
Preferred Stock, Shares Issued (in shares)	126,680	128,181
Series B Preferred Stock [Member]
Preferred Stock, Shares Authorized (in shares)	1,500,000	1,500,000
Preferred Stock, Shares Outstanding (in shares)	0	0
Preferred Stock, Shares Issued (in shares)	0	0

Condensed Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Revenues:
Product revenue, net	$ 2,043,000	$ 3,970,000	$ 5,094,000	$ 8,000,000
Operating costs and expenses:
Cost of goods sold - product revenue	1,265,000	1,879,000	3,372,000	5,018,000
General and administrative	1,423,000	1,775,000	2,968,000	3,763,000
Sales and marketing	117,000	319,000	451,000	687,000
Research and development	(26,000)	39,000	(20,000)	91,000
Total operating costs and expenses	2,779,000	4,012,000	6,771,000	9,559,000
Loss from operations	(736,000)	(42,000)	(1,677,000)	(1,559,000)
Other expense income:
Interest expense	(156,000)	(111,000)	(339,000)	(242,000)
Debt extinguishment gain	(75,000)	0	(75,000)	35,000
Change in fair value of derivative liabilities	0	185,000	79,000	408,000
Total other (expense) income	(231,000)	74,000	(335,000)	201,000
Net loss	$ (967,000)	$ 32,000	$ (2,012,000)	$ (1,358,000)
Basic (in dollars per share)	$ 0	$ 0	$ (0.01)	$ (0.01)
Diluted (in dollars per share)	$ 0	$ 0	$ (0.01)	$ (0.01)
Weighted average number of common shares outstanding
Basic (in shares)	228,988,755	216,372,777	224,795,559	214,987,456
Diluted (in shares)	228,988,755	245,299,090	224,795,559	214,987,456

Condensed Consolidated Statements of Stockholders' Equity (Deficit) (Unaudited) - USD ($) shares in Thousands	Preferred Stock [Member] Series A Preferred Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Balance (in shares) at Dec. 31, 2022	133	219,163
Balance at Dec. 31, 2022	$ 0	$ 219,000	$ 7,928,000	$ (6,447,000)	$ 1,700,000
Stock compensation (in shares)	0	4,384
Stock compensation	$ 0	$ 4,000	78,000	0	82,000
Net loss	$ 0	$ 0	0	(1,358,000)	(1,358,000)
Conversion of Series A convertible preferred stock (in shares)	(5)	1,183
Conversion of Series A convertible preferred stock	$ 0	$ 2,000	(2,000)	0	0
Balance (in shares) at Jun. 30, 2023	128	224,730
Balance at Jun. 30, 2023	$ 0	$ 225,000	8,004,000	(7,805,000)	424,000
Balance (in shares) at Mar. 31, 2023	130	224,112
Balance at Mar. 31, 2023	$ 0	$ 224,000	7,968,000	(7,837,000)	355,000
Stock compensation (in shares)	0	184
Stock compensation	$ 0	$ 0	37,000	0	37,000
Net loss	$ 0	$ 0	0	32,000	32,000
Conversion of Series A convertible preferred stock (in shares)	(2)	434
Conversion of Series A convertible preferred stock	$ 0	$ 1,000	(1,000)	0	0
Balance (in shares) at Jun. 30, 2023	128	224,730
Balance at Jun. 30, 2023	$ 0	$ 225,000	8,004,000	(7,805,000)	424,000
Balance (in shares) at Dec. 31, 2023	128	228,535
Balance at Dec. 31, 2023	$ 0	$ 229,000	8,204,000	(8,540,000)	(107,000)
Issuance of common shares for cash (in shares)	0	12,875
Issuance of common shares for cash	$ 0	$ 13,000	1,017,000	0	1,030,000
Issuance of common shares from debt redemption (in shares)	0	7,500
Issuance of common shares from debt redemption	$ 0	$ 8,000	668,000	0	676,000
Forfeiture of restricted stock awards (in shares)		(172)
Forfeiture of restricted stock awards		$ 0	(1,000)	0	(1,000)
Stock compensation (in shares)	0	525
Stock compensation	$ 0	$ 0	118,000	0	118,000
Net loss	$ 0	$ 0	0	(2,012,000)	(2,012,000)
Conversion of Series A convertible preferred stock (in shares)	(1)	339
Conversion of Series A convertible preferred stock	$ 0		(0)	0	(0)
Balance (in shares) at Jun. 30, 2024	127	249,602
Balance at Jun. 30, 2024	$ 0	$ 250,000	10,006,000	(10,552,000)	(296,000)
Balance (in shares) at Mar. 31, 2024	127	229,349
Balance at Mar. 31, 2024	$ 0	$ 229,000	8,266,000	(9,585,000)	(1,090,000)
Issuance of common shares for cash (in shares)	0	12,875
Issuance of common shares for cash	$ 0	$ 13,000	1,017,000	0	1,030,000
Issuance of common shares from debt redemption (in shares)	0	7,500
Issuance of common shares from debt redemption	$ 0	$ 8,000	668,000	0	676,000
Forfeiture of restricted stock awards (in shares)		(122)
Forfeiture of restricted stock awards		$ 0	(1,000)	0	(1,000)
Stock compensation (in shares)	0	0
Stock compensation	$ 0	$ 0	56,000	0	56,000
Net loss	$ 0	$ 0	0	(967,000)	(967,000)
Balance (in shares) at Jun. 30, 2024	127	249,602
Balance at Jun. 30, 2024	$ 0	$ 250,000	$ 10,006,000	$ (10,552,000)	$ (296,000)

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Cash Flows from Operating Activities:
Net loss	$ (2,012,000)	$ (1,358,000)
Reconciliation of net (loss) income to net cash used in operating activities:
Allowance for doubtful accounts	10,000	85,000
Depreciation and amortization	66,000	80,000
Accretion of debt discount	137,000	132,000
Change in fair value of derivative liabilities	(79,000)	(408,000)
Debt extinguishment gain	(75,000)	35,000
Amortization of operating lease right-of-use asset	205,000	182,000
Stock based compensation	117,000	82,000
Subtotal of non-cash charges	531,000	118,000
us-gaap_IncreaseDecreaseInOperatingCapitalAbstract
Accounts receivable	(53,000)	554,000
Inventories	623,000	621,000
Prepaid expenses and other current assets	466,000	327,000
Accounts payable and accrued expenses	170,000	117,000
Deferred revenue	180,000	(75,000)
Lease liabilities	(205,000)	(180,000)
Net cash provided by (used in) operating activities	(300,000)	124,000
Cash Flows from Financing Activities:
Proceeds from issuance of common shares	1,030,000	0
Proceeds from issuance of notes payable	0	630,000
Proceeds from issuance of note payable to related party	500,000	0
Net cash provided by financing activities	1,018,000	(38,000)
Net (decrease) increase in cash	718,000	86,000
Cash, beginning of the period	367,000	257,000
Cash, end of the period	1,085,000	343,000
Supplemental Cash Flow Information [Abstract]
Cash paid for interest	4,000	145,000
Cash paid for interest to related party	90,000	15,000
Cash paid for income taxes	0	4,000
Conversion of Series A convertible preferred stock	0	2,000
Issuance of common shares from debt redemption	676,000	0
Nonrelated Party [Member]
Cash Flows from Financing Activities:
Repayment of notes payable	(462,000)	(668,000)
Related Party [Member]
Cash Flows from Financing Activities:
Repayment of notes payable	$ (50,000)	$ 0

Note 1 - Description of the Business and Basis of Presentation

6 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Business Description and Basis of Presentation [Text Block]

NOTE 1 – DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION

Description of the Business

The Company's common stock, par value $0.001 per share (the “Common Stock”), trades under the symbol "CHUC" on the OTCQB Venture Market.

Substantial Doubt to Continue as a Going Concern Regarding the Legal and Regulatory Environment, Liquidity and Management’s Plan of Operation

Risks and Uncertainties

Note 2 - Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Significant Accounting Policies [Text Block]

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

Use of Estimates

Significant Accounting Policies

There have been no material changes in the Company’s significant accounting policies to those previously disclosed in the 2023 Annual Report.

Recently Issued Accounting Standards, Not Yet Adopted

Improvements to Reportable Segment Disclosures

Improvements to Income Tax Disclosures

Scope Applications of Profits Interests and Similar Awards

Note 3 - Fair Value Measurements

6 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Fair Value Disclosures [Text Block]

NOTE 3 – FAIR VALUE MEASUREMENTS

Level 1 – Unadjusted quoted prices in active markets for identical instruments that are accessible by the Company on the measurement date.

Level 2 – Quoted prices in markets that are not active or inputs which are either directly or indirectly observable.

Level 3 – Unobservable inputs for the instrument requiring the development of assumptions by the Company.

The following table classifies the Company’s liabilities measured at fair value on a recurring basis into the fair value hierarchy as of June 30, 2024, and December 31, 2023 (amounts in thousands):

Fair Value at June 30, 2024

Total

Level 1

Level 2

Level 3

Liabilities:

Derivative liability - Warrants

Total liabilities

	Fair Value at December 31, 2023
	Total		Level 1		Level 2		Level 3
Liabilities:
Derivative liability - Warrants		79		-		-		79
Total liabilities	$	79	$	-	$	-	$	79

There were no transfers between Level 1, 2 or 3 during the six-month period ended June 30, 2024.

	Derivative liability - Warrants
Balance at January 1, 2024	$	79
Change in fair value		(79	)
Balance at June 30, 2024	$	-

	April 26,			December 31,
	2024			2023
Exercise price	$	0.4431		$	0.4431
Contractual term (years)		0.07			0.32
Volatility (annual)		110.0	%		90.0	%
Risk-free rate		4.5	%		5.4	%
Dividend yield (per share)		0	%		0	%

On April 26, 2024, the Investor Warrants and Placement Agent Warrants expired without being exercised.

Note 4 - Property and Equipment

6 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Property, Plant and Equipment Disclosure [Text Block]

NOTE 4 – PROPERTY AND EQUIPMENT

	June 30,			December 31,			Estimated Useful Life
	2024			2023			(years)
Machinery and equipment	$	41		$	41			5
Trade show booth		202			202			5
Office equipment		539			539			5
Leasehold improvements		254			254		Lesser of lease term or estimated useful life
		1,036			1,036
Accumulated depreciation		(945	)		(879	)
Net Property & Equipment	$	91		$	157

Note 5 - Concentrations

6 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Concentration Risk Disclosure [Text Block]

NOTE 5 – CONCENTRATIONS

Vendors

The Company’s concentration of inventory purchases is as follows:

	For the three months ended June 30,						For the six months ended June 30,

	2024			2023			2024			2023

Vendor A		13	%		44	%		-			62	%
Vendor B		-			12	%		-			13	%
Vendor C		44	%		-			24	%		-
Vendor D		-			-			16	%		-
Vendor E		-			-			15	%		-
Vendor F		-			-			12	%		-
Vendor G		17	%		-			-			-
Vendor H		12	%		-			-			-

Accounts Receivable

The Company’s concentration of accounts receivable is as follows:

	June 30,				December 31,
	2024				2023

Customer A	$	117,000	30	%	$	93,000	27	%
Customer B	$	38,000	10	%	$	47,000	13	%
Customer C	$	41,000	10	%	$	71,000	20	%
Customer D					$	39,000	11	%
Customer E					$	33,000	10	%
Customer F	$	43,000	11	%		-	-

Note 6 - Don Polly, LLC.

6 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Variable Interest Entity Disclosure [Text Block]

NOTE 6 – DON POLLY, LLC

Note 7 - Accounts Payable and Accrued Expenses

6 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Accounts Payable, Accrued Liabilities, and Other Liabilities Disclosure, Current [Text Block]

NOTE 7 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses as of June 30, 2024 and December 31, 2023, are as follows (amounts in thousands):

	June 30,		December 31,
	2024		2023
Accounts payable	$	1,626	$	1,472
Accrued compensation		546		573
Accrued income taxes		128		128
Customer deposits		31		386
Other accrued expenses		685		287
	$	3,016	$	2,846

Note 8 - Notes Payable

6 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Debt Disclosure [Text Block]

NOTE 8 – NOTES PAYABLE

January 2024 Note Financing

July 2023 Note Financing

2023 Receivables Financing

April 2022 Note Financing

August 2022 Note Financing – Related Party

Economic Injury Disaster Loan

The following summarizes the Company’s notes payable maturities as of June 30, 2024 (amounts in thousands):

Six Months Ending December 31, 2024	$	1,126
Year Ending December 31, 2025		827
Year Ending December 31, 2026		-
Year Ending December 31, 2027		-
Year Ending December 31, 2028		-
Thereafter		150
		2,103
Debt discount		(57	)
Total	$	2,046

Note 9 - (Loss) Per Share Applicable to Common Stockholders

6 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Earnings Per Share [Text Block]

NOTE 9 – (LOSS) PER SHARE APPLICABLE TO COMMON STOCKHOLDERS

The following table sets forth the computation of (loss) earnings per share (amounts in thousands, except share and per share amounts):

	For the three months ended						For the six months ended
	June 30,						June 30,
	2024			2023			2024			2023
Net (loss) income - basic	$	(967	)	$	32		$	(2,012	)	$	(1,358	)
Reversal of gain due to change in fair value of warrant liability		-			(185	)		-			-
Net loss - diluted	$	(967	)	$	(153	)	$	(2,012	)	$	(1,358	)

Weighted average shares outstanding - basic		228,988,755			216,372,777			224,795,559			214,987,456
Diluted preferred shares		-			28,926,313			-			-
Weighted average shares outstanding - diluted		228,988,755			245,299,090			224,795,559			214,987,456

Basic earnings (loss) per share	$	0.00		$	0.00		$	(0.01	)	$	(0.01	)
Diluted earnings (loss) per share	$	0.00		$	(0.00	)	$	(0.01	)	$	(0.01	)

The following securities were not included in the diluted net loss per share calculation because their effect was anti-dilutive as of the periods presented (in thousands):

	For the six months ended
	June 30,
	2024		2023
Options		4,648		5,812
Warrants		40,338		40,338
Series A convertible preferred shares		28,588		28,926
Total		73,574		75,076

Note 10 - Stockholders' Equity

6 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Equity [Text Block]

NOTE 10 – STOCKHOLDERS’ EQUITY

Conversion of Series A Preferred Shares

During the six months ended June 30, 2024, the Company issued approximately 339,000 shares of Common Stock upon conversion of 1,501 shares of Series A Preferred.

May 2024 Capital Raise

Note 11 - Stock-based Compensation

6 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Share-Based Payment Arrangement [Text Block]

NOTE 11 – STOCK-BASED COMPENSATION

Non-Qualified Stock Options

The following table summarizes stock option activities during the six months ended June 30, 2024 (all option amounts are in thousands):

	Stock Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)		Aggregate Intrinsic Value
Outstanding at January 1, 2024		5,272		$	0.58		5.3	$	-
Options forfeited/expired		(624	)		1.44		-		-
Outstanding at June 30, 2024		4,648		$	0.46		5.3	$	-
Options vested and exercisable at June 30, 2024		4,648		$	0.46		5.3	$	-

Restricted Stock Awards

The following table summarizes restricted stock awards activities during the six months ended June 30, 2024 (all share amounts are in thousands):

	Number of Shares			Weighted Average Grant Date Fair Value per Share
Nonvested at January 1, 2024		10,095		$	0.050
Restricted stock granted		525			0.041
Vested		(3,414	)		-
Forfeited		(172	)		-
Nonvested at June 30, 2024		7,034		$	0.063

Note 12 - Commitments and Contingencies

6 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Commitments and Contingencies Disclosure [Text Block]

NOTE 12 – COMMITMENTS AND CONTINGENCIES

Leases

Effective June 1, 2022, the Company’s lease at 5331 Production Drive, Huntington Beach, CA was renewed for an additional three-year term, concluding May 31, 2025.

The following table summarizes quantitative information about the Company’s operating leases for the three and six months ended June 30, 2024 and 2023 (amounts in thousands):

	For the three months ended				For the six months ended
	June 30,				June 30,
	2024		2023		2024		2023
Operating leases
Operating lease cost	$	113	$	113	$	225	$	225
Variable lease cost		-		-		-		-
Operating lease expense		113		113		225		225
Short-term lease rent expense		5		5		10		10
Total rent expense	$	118	$	118	$	235	$	235

	For the six months ended
	June 30,
	2024			2023
Operating cash flows from operating leases	$	226		$	202
Weighted-average remaining lease term – operating leases (in years)		0.74			1.58
Weighted-average discount rate – operating leases		12.0	%		12.0	%

Maturities of our operating leases as of June 30, 2024, excluding short-term leases, are as follows (amounts in thousands):

Six Months Ending December 31, 2024	$	159
Year Ending December 31, 2025		75
Total		234
Less present value discount		(11	)
Operating lease liabilities as of March 31, 2024	$	223

Legal Proceedings

New Executive Employment Agreement

Note 13- Income Taxes

6 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Income Tax Disclosure [Text Block]

NOTE 13 – INCOME TAXES

Note 14 - Subsequent Events

6 Months Ended

Jun. 30, 2024

Notes to Financial Statements

Subsequent Events [Text Block]

NOTE 14 – SUBSEQUENT EVENTS

Insider Trading Arrangements	3 Months Ended	6 Months Ended
Insider Trading Arrangements	Jun. 30, 2024	Jun. 30, 2024
Insider Trading Arr Line Items
Material Terms of Trading Arrangement [Text Block]		ITEM 5. OTHER INFORMATION During the quarter ended June 30, 2024, no director or Section 16 Officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.
Rule 10b5-1 Arrangement Adopted [Flag]	false
Non-Rule 10b5-1 Arrangement Adopted [Flag]	false
Rule 10b5-1 Arrangement Terminated [Flag]	false
Non-Rule 10b5-1 Arrangement Terminated [Flag]	false

Significant Accounting Policies (Policies)	6 Months Ended
Significant Accounting Policies (Policies)	Jun. 30, 2024
Accounting Policies [Abstract]
Consolidation, Policy [Policy Text Block]	Basis of Presentation The unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) have been omitted pursuant to SEC rules and regulations; nevertheless, the Company believes that the disclosures are adequate to make the information presented in this Report not misleading. The unaudited interim financial statements furnished in this document reflect all adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary to a fair statement of the results for the interim periods presented.
Use of Estimates, Policy [Policy Text Block]	Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.
Significant Accounting Policies [Policy Text Block]	Significant Accounting Policies There have been no material changes in the Company’s significant accounting policies to those previously disclosed in the 2023 Annual Report.
New Accounting Pronouncements, Policy [Policy Text Block]	*Recently Issued Accounting Standards, Not* *Yet Adopted* Improvements to Reportable Segment Disclosures In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”). ASU 2023-07 updates segment reporting disclosure requirements and brings about significant changes, particularly in the realm of transparency and accountability within organizations. The primary thrust of ASU 2023-07 is the inclusion of detailed disclosures regarding significant reportable segment expenses. These are expenses regularly provided to the Chief Operating Decision Maker (“CODM”) and are integral components of each reported measure reflecting a segment's profit or loss. Furthermore, the ASU mandates disclosure of the CODM's title, position, and a comprehensive explanation of how the reported measures of segment profit or loss factor into assessing segment performance and resource allocation decisions. This transparency aims to provide stakeholders with a clearer understanding of the decision-making processes within an organization and how segment performance is evaluated. Improvements to Income Tax Disclosures In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09), which improves the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the effective tax rate reconciliation and income taxes paid disaggregated by jurisdiction. It also includes certain other amendments to improve the effectiveness of income tax disclosures. This guidance will be effective for the annual periods beginning the year ended December 31, 2025. Early adoption is permitted. Upon adoption, the guidance can be applied prospectively or retrospectively. The Company does not expect the adoption of this guidance to have a material impact on its condensed consolidated financial statements. Scope Applications of Profits Interests and Similar Awards In March 2024, the FASB issued ASU No. 2024-01, “Compensation-Stock Compensation (Topic 718): Scope Applications of Profits Interests and Similar Awards” (ASU 2024-01). ASU 2024-01 adds an example to Topic 718 which illustrates how to apply the scope guidance to determine whether profits interests and similar awards should be accounted for as share-based payment arrangements under Topic 718 or under other U.S. GAAP. ASU 2024-01 is effective for annual periods beginning after December 15, 2024, although early adoption is permitted. Upon adoption, ASU 2024-01 is not expected to have an impact on the Company’s condensed consolidated financial statements.

Note 3 - Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2024

Notes Tables

Fair Value, Liabilities Measured on Recurring Basis [Table Text Block]

Fair Value at June 30, 2024

Total

Level 1

Level 2

Level 3

Liabilities:

Derivative liability - Warrants

Total liabilities

	Fair Value at December 31, 2023
	Total		Level 1		Level 2		Level 3
Liabilities:
Derivative liability - Warrants		79		-		-		79
Total liabilities	$	79	$	-	$	-	$	79

Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block]

	Derivative liability - Warrants
Balance at January 1, 2024	$	79
Change in fair value		(79	)
Balance at June 30, 2024	$	-

Fair Value Measurement Inputs and Valuation Techniques [Table Text Block]

	April 26,			December 31,
	2024			2023
Exercise price	$	0.4431		$	0.4431
Contractual term (years)		0.07			0.32
Volatility (annual)		110.0	%		90.0	%
Risk-free rate		4.5	%		5.4	%
Dividend yield (per share)		0	%		0	%

Note 4 - Property and Equipment (Tables)

6 Months Ended

Jun. 30, 2024

Notes Tables

Property, Plant and Equipment [Table Text Block]

	June 30,			December 31,			Estimated Useful Life
	2024			2023			(years)
Machinery and equipment	$	41		$	41			5
Trade show booth		202			202			5
Office equipment		539			539			5
Leasehold improvements		254			254		Lesser of lease term or estimated useful life
		1,036			1,036
Accumulated depreciation		(945	)		(879	)
Net Property & Equipment	$	91		$	157

Note 5 - Concentrations (Tables)

6 Months Ended

Jun. 30, 2024

Notes Tables

Schedules of Concentration of Risk, by Risk Factor [Table Text Block]

	For the three months ended June 30,						For the six months ended June 30,

	2024			2023			2024			2023

Vendor A		13	%		44	%		-			62	%
Vendor B		-			12	%		-			13	%
Vendor C		44	%		-			24	%		-
Vendor D		-			-			16	%		-
Vendor E		-			-			15	%		-
Vendor F		-			-			12	%		-
Vendor G		17	%		-			-			-
Vendor H		12	%		-			-			-

	June 30,				December 31,
	2024				2023

Customer A	$	117,000	30	%	$	93,000	27	%
Customer B	$	38,000	10	%	$	47,000	13	%
Customer C	$	41,000	10	%	$	71,000	20	%
Customer D					$	39,000	11	%
Customer E					$	33,000	10	%
Customer F	$	43,000	11	%		-	-

Note 7 - Accounts Payable and Accrued Expenses (Tables)

6 Months Ended

Jun. 30, 2024

Notes Tables

Schedule of Accounts Payable and Accrued Liabilities [Table Text Block]

	June 30,		December 31,
	2024		2023
Accounts payable	$	1,626	$	1,472
Accrued compensation		546		573
Accrued income taxes		128		128
Customer deposits		31		386
Other accrued expenses		685		287
	$	3,016	$	2,846

Note 8 - Notes Payable (Tables)

6 Months Ended

Jun. 30, 2024

Notes Tables

Schedule of Maturities of Long-Term Debt [Table Text Block]

Six Months Ending December 31, 2024	$	1,126
Year Ending December 31, 2025		827
Year Ending December 31, 2026		-
Year Ending December 31, 2027		-
Year Ending December 31, 2028		-
Thereafter		150
		2,103
Debt discount		(57	)
Total	$	2,046

Note 9 - (Loss) Per Share Applicable to Common Stockholders (Tables)

6 Months Ended

Jun. 30, 2024

Notes Tables

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

	For the three months ended						For the six months ended
	June 30,						June 30,
	2024			2023			2024			2023
Net (loss) income - basic	$	(967	)	$	32		$	(2,012	)	$	(1,358	)
Reversal of gain due to change in fair value of warrant liability		-			(185	)		-			-
Net loss - diluted	$	(967	)	$	(153	)	$	(2,012	)	$	(1,358	)

Weighted average shares outstanding - basic		228,988,755			216,372,777			224,795,559			214,987,456
Diluted preferred shares		-			28,926,313			-			-
Weighted average shares outstanding - diluted		228,988,755			245,299,090			224,795,559			214,987,456

Basic earnings (loss) per share	$	0.00		$	0.00		$	(0.01	)	$	(0.01	)
Diluted earnings (loss) per share	$	0.00		$	(0.00	)	$	(0.01	)	$	(0.01	)

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block]

	For the six months ended
	June 30,
	2024		2023
Options		4,648		5,812
Warrants		40,338		40,338
Series A convertible preferred shares		28,588		28,926
Total		73,574		75,076

Note 11 - Stock-based Compensation (Tables)

6 Months Ended

Jun. 30, 2024

Notes Tables

Share-Based Payment Arrangement, Option, Activity [Table Text Block]

	Stock Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)		Aggregate Intrinsic Value
Outstanding at January 1, 2024		5,272		$	0.58		5.3	$	-
Options forfeited/expired		(624	)		1.44		-		-
Outstanding at June 30, 2024		4,648		$	0.46		5.3	$	-
Options vested and exercisable at June 30, 2024		4,648		$	0.46		5.3	$	-

Schedule of Unvested Restricted Stock Units Roll Forward [Table Text Block]

	Number of Shares			Weighted Average Grant Date Fair Value per Share
Nonvested at January 1, 2024		10,095		$	0.050
Restricted stock granted		525			0.041
Vested		(3,414	)		-
Forfeited		(172	)		-
Nonvested at June 30, 2024		7,034		$	0.063

Note 12 - Commitments and Contingencies (Tables)

6 Months Ended

Jun. 30, 2024

Notes Tables

Lease, Cost [Table Text Block]

	For the three months ended				For the six months ended
	June 30,				June 30,
	2024		2023		2024		2023
Operating leases
Operating lease cost	$	113	$	113	$	225	$	225
Variable lease cost		-		-		-		-
Operating lease expense		113		113		225		225
Short-term lease rent expense		5		5		10		10
Total rent expense	$	118	$	118	$	235	$	235

	For the six months ended
	June 30,
	2024			2023
Operating cash flows from operating leases	$	226		$	202
Weighted-average remaining lease term – operating leases (in years)		0.74			1.58
Weighted-average discount rate – operating leases		12.0	%		12.0	%

Lessee, Operating Lease, Liability, to be Paid, Maturity [Table Text Block]

Six Months Ending December 31, 2024	$	159
Year Ending December 31, 2025		75
Total		234
Less present value discount		(11	)
Operating lease liabilities as of March 31, 2024	$	223

Note 1 - Description of the Business and Basis of Presentation (Details Textual) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Mar. 31, 2024	Dec. 31, 2023	Mar. 31, 2023	Dec. 31, 2022
Common Stock, Par or Stated Value Per Share (in dollars per share)	$ 0.001		$ 0.001			$ 0.001
Operating Income (Loss)	$ 736,000	$ 42,000	$ 1,677,000	$ 1,559,000
Net Income (Loss) Attributable to Parent	967,000	(32,000)	2,012,000	1,358,000
Net Cash Provided by (Used in) Operating Activities			300,000	(124,000)
Equity, Attributable to Parent	296,000	$ (424,000)	296,000	$ (424,000)	$ 1,090,000	$ 107,000	$ (355,000)	$ (1,700,000)
Working Capital	$ 557,000		$ 557,000			$ 332,000

Note 3 - Fair Value Measurements (Details Textual) - USD ($) $ / shares in Units, $ in Millions	Apr. 26, 2019	Jun. 30, 2024	Dec. 31, 2023
Proceeds from Issuance of Private Placement	$ 27.5
Preferred Stock, Par or Stated Value Per Share (in dollars per share)		$ 0.001	$ 0.001
Warrants and Rights Outstanding, Term	5 years
Class of Warrant or Right, Exercise Price of Warrants or Rights	$ 0.44313
Investor Warrants [Member]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights	31,028,996
Placement Agent Warrants [Member]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights	9,308,699
Series A Preferred Stock [Member]
Preferred Stock, Par or Stated Value Per Share (in dollars per share)	$ 0.001

Note 3 - Fair Value Measurements - Fair Value Hierarchy on a Recurring Basis (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Total liabilities	$ 0	$ 79
Fair Value, Recurring [Member]
Total liabilities	0	79
Total liabilities	0	79
Fair Value, Recurring [Member] \| Fair Value, Inputs, Level 1 [Member]
Total liabilities	0	0
Total liabilities	0	0
Fair Value, Recurring [Member] \| Fair Value, Inputs, Level 2 [Member]
Total liabilities	0	0
Total liabilities	0	0
Fair Value, Recurring [Member] \| Fair Value, Inputs, Level 3 [Member]
Total liabilities	0	79
Total liabilities	$ 0	$ 79

Note 3 - Fair Value Measurements - Changes in Level 3 Liabilities (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2024 USD ($)
Balance	$ 79
Change in fair value	(79)
Balance at March 31, 2023	$ 0

Note 3 - Fair Value Measurements - Unobservable Inputs Assumptions (Details)	Apr. 26, 2024	Dec. 31, 2023
Measurement Input, Exercise Price [Member]
Deriviative, measurement input	0.4431	0.4431
Measurement Input, Expected Term [Member]
Deriviative, measurement input	0.07	0.32
Measurement Input, Price Volatility [Member]
Deriviative, measurement input	1.10	0.90
Measurement Input, Risk Free Interest Rate [Member]
Deriviative, measurement input	0.045	0.054
Measurement Input, Expected Dividend Rate [Member]
Deriviative, measurement input	0	0

Note 4 - Property and Equipment (Details Textual) - USD ($)	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Depreciation, Depletion and Amortization, Nonproduction	$ 66,000	$ 80,000

Note 4 - Property and Equipment - Property and Equipment (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Property, plant, and equipment, gross	$ 1,036	$ 1,036
Accumulated depreciation	(945)	(879)
Property, Plant and Equipment, Net	91	157
Machinery and Equipment [Member]
Property, plant, and equipment, gross	$ 41	41
Useful life (Year)	5 years
Trade Show Booth [Member]
Property, plant, and equipment, gross	$ 202	202
Useful life (Year)	5 years
Office Equipment [Member]
Property, plant, and equipment, gross	$ 539	539
Useful life (Year)	5 years
Leasehold Improvements [Member]
Property, plant, and equipment, gross	$ 254	$ 254

Note 5 - Concentrations (Details Textual)	3 Months Ended		6 Months Ended		12 Months Ended
Note 5 - Concentrations (Details Textual)	Jun. 30, 2024 USD ($)	Jun. 30, 2023	Jun. 30, 2024 USD ($)	Jun. 30, 2023	Dec. 31, 2023 USD ($)
Accounts Payable and Accrued Liabilities, Current	$ 3,016,000		$ 3,016,000		$ 2,846,000
Five Vendors [Member]
Accounts Payable and Accrued Liabilities, Current	$ 666,000		$ 666,000
Six Vendors [Member]
Accounts Payable and Accrued Liabilities, Current					$ 266,000
Inventory Purchases [Member] \| Supplier Concentration Risk [Member]
Number of Major Vendors	5	6	5	6
Inventory Purchases [Member] \| Supplier Concentration Risk [Member] \| Five Vendors [Member]
Concentration Risk, Percentage	86.00%		56.00%
Inventory Purchases [Member] \| Supplier Concentration Risk [Member] \| Six Vendors [Member]
Concentration Risk, Percentage		67.00%		75.00%
Accounts Receivable [Member] \| Customer Concentration Risk [Member]
Number of Major Customers			4		5
Accounts Receivable [Member] \| Customer Concentration Risk [Member] \| Four Customers [Member]
Concentration Risk, Percentage			61.00%
Accounts Receivable [Member] \| Customer Concentration Risk [Member] \| Five Customers [Member]
Concentration Risk, Percentage					81.00%

Note 5 - Concentrations - Schedule of Concentration Risk (Details) - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023
Customer A [Member]
Accounts receivable	$ 117,000		$ 117,000		$ 93,000
Customer B [Member]
Accounts receivable	38,000		38,000		47,000
Customer C [Member]
Accounts receivable	41,000		41,000		71,000
Customer D [Member]
Accounts receivable					39,000
Customer E [Member]
Accounts receivable					33,000
Customer F [Member]
Accounts receivable	$ 43,000		$ 43,000		$ 0
Inventory Purchases [Member] \| Supplier Concentration Risk [Member] \| Vendor A [Member]
Concentration	13.00%	44.00%	0.00%	62.00%
Inventory Purchases [Member] \| Supplier Concentration Risk [Member] \| Vendor B [Member]
Concentration	0.00%	12.00%	0.00%	13.00%
Inventory Purchases [Member] \| Supplier Concentration Risk [Member] \| Vendor C [Member]
Concentration	44.00%	0.00%	24.00%	0.00%
Inventory Purchases [Member] \| Supplier Concentration Risk [Member] \| Vendor D [Member]
Concentration	0.00%	0.00%	16.00%	0.00%
Inventory Purchases [Member] \| Supplier Concentration Risk [Member] \| Vendor E [Member]
Concentration	0.00%	0.00%	15.00%	0.00%
Inventory Purchases [Member] \| Supplier Concentration Risk [Member] \| Vendor F [Member]
Concentration	0.00%	0.00%	12.00%	0.00%
Inventory Purchases [Member] \| Supplier Concentration Risk [Member] \| Vendor G [Member]
Concentration	17.00%	0.00%	0.00%	0.00%
Inventory Purchases [Member] \| Supplier Concentration Risk [Member] \| Vendor H [Member]
Concentration	12.00%	0.00%	0.00%	0.00%
Accounts Receivable [Member] \| Customer Concentration Risk [Member] \| Customer A [Member]
Concentration			30.00%		27.00%
Accounts Receivable [Member] \| Customer Concentration Risk [Member] \| Customer B [Member]
Concentration			10.00%		13.00%
Accounts Receivable [Member] \| Customer Concentration Risk [Member] \| Customer C [Member]
Concentration			10.00%		20.00%
Accounts Receivable [Member] \| Customer Concentration Risk [Member] \| Customer D [Member]
Concentration					11.00%
Accounts Receivable [Member] \| Customer Concentration Risk [Member] \| Customer E [Member]
Concentration					10.00%
Accounts Receivable [Member] \| Customer Concentration Risk [Member] \| Customer F [Member]
Concentration			11.00%		0.00%

Note 6 - Don Polly, LLC. (Details Textual) - Don Polly, LLC [Member]	6 Months Ended
	Jun. 30, 2024
Percent of Net Income Received, Variable Interest Entity	100.00%
Percent of Net Loss Incurred Variable Interest Entity	100.00%

Note 7 - Accounts Payable and Accrued Expenses - Accounts Payable (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Accounts payable	$ 1,626	$ 1,472
Accrued compensation	546	573
Accrued income taxes	128	128
Customer deposits	31	386
Other accrued expenses	685	287
Accounts Payable and Accrued Liabilities, Current	$ 3,016	$ 2,846

Note 8 - Notes Payable (Details Textual) - USD ($)						12 Months Ended
Note 8 - Notes Payable (Details Textual) - USD ($)	May 31, 2024	Dec. 13, 2023	Mar. 28, 2023	Aug. 17, 2022	Jun. 24, 2020	Dec. 31, 2023	Jun. 30, 2024	Jan. 24, 2024	Aug. 01, 2023	Apr. 06, 2022
Michael King [Member] \| Notes Payable, Other Payables [Member]
Debt Instrument, Face Amount										$ 1,000,000
Debt Instrument, Periodic Payment, Principal			$ 25,000
Debt Instrument, Interest Rate During Period			20.00%
Conversion Of January 2024 Note Into Shares Under Subscription Agreement [Member]
Debt Conversion, Original Debt, Amount	$ 500,000
Conversion of April 2022 Note to Shares Under Subscription Agreement [Member]
Debt Conversion, Original Debt, Amount	100,000
January 2024 Note [Member]
Debt Instrument, Face Amount								$ 500,000
Debt Instrument, Interest Rate, Stated Percentage								21.00%
Payment of Debt Interest Expense	$ 52,500
July 2023 Note Financing [Member] \| Related Party [Member]
Debt Instrument, Face Amount									$ 1,400,000
Debt Instrument, Interest Rate, Stated Percentage									21.00%
Debt Instrument, Periodic Payment, Principal						$ 1,070,000
Debt Instrument, Periodic Payment, Interest						$ 70,000
Notes Payable							$ 400,000
Receivables Financing Agreement [Member]
Debt Instrument, Face Amount		$ 750,000
Notes Payable							$ 426,000
Debt Instrument, Origination Fee		3.00%
Debt Instrument, Periodic Payment		$ 17,740
Debt Instrument, Total Payments to Be Made		$ 922,500
The “Loan” [Member]
Debt Instrument, Face Amount				$ 300,000
Debt Instrument, Interest Rate During Period				10.00%
Debt Issuance Costs, Gross				$ 3,000
EID Loan [Member] \| Don Polly [Member]
Debt Instrument, Interest Rate, Stated Percentage					3.75%
Proceeds from Issuance of Debt					$ 150,000

Note 8 - Notes Payable - Notes Payable Maturities (Details) $ in Thousands	Jun. 30, 2024 USD ($)
Six Months Ending December 31, 2024	$ 1,126
Year Ending December 31, 2025	827
Year Ending December 31, 2026	0
Year Ending December 31, 2027	0
Year Ending December 31, 2028	0
Thereafter	150
Long-Term Debt, Gross	2,103
Debt discount	(57)
Total	$ 2,046

Note 9 - (Loss) Per Share Applicable to Common Stockholders - Summary of Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Net (loss) income - basic	$ (967)	$ 32	$ (2,012)	$ (1,358)
Reversal of gain due to change in fair value of warrant liability	(0)	185	(0)	(0)
Net loss - diluted	$ (967)	$ (153)	$ (2,012)	$ (1,358)
Weighted average shares outstanding - basic (in shares)	228,988,755	216,372,777	224,795,559	214,987,456
Diluted preferred shares (in shares)	0	28,926,313	0	0
Weighted average shares outstanding - diluted (in shares)	228,988,755	245,299,090	224,795,559	214,987,456
Basic (in dollars per share)	$ 0	$ 0	$ (0.01)	$ (0.01)
Diluted (in dollars per share)	$ 0	$ 0	$ (0.01)	$ (0.01)

Note 9 - (Loss) Per Share Applicable to Common Stockholders - Antidilutive Securities (Details) - shares shares in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Antidilutive securities (in shares)	73,574	75,076
Share-Based Payment Arrangement, Option [Member]
Antidilutive securities (in shares)	4,648	5,812
Warrant [Member]
Antidilutive securities (in shares)	40,338	40,338
Series A [Member]
Antidilutive securities (in shares)	28,588	28,926

Note 10 - Stockholders' Equity (Details Textual) - USD ($)		3 Months Ended		6 Months Ended
	May 31, 2024	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023
Common Stock, Par or Stated Value Per Share (in dollars per share)		$ 0.001		$ 0.001		$ 0.001
Proceeds from Issuance of Common Stock				$ 1,030,000	$ 0
Gain (Loss) on Extinguishment of Debt		$ (75,000)	$ 0	(75,000)	$ 35,000
Conversion of Debt into Shares Under Subscription Agreement [Member]
Debt Conversion, Original Debt, Amount	$ 600,000
Gain (Loss) on Extinguishment of Debt		$ (75,000)		$ (75,000)
Capital Raise Subscription Agreement [Member]
Stock Issued During Period, Shares, New Issues (in shares)	20,375,000
Common Stock, Par or Stated Value Per Share (in dollars per share)	$ 0.001
Shares Issued, Price Per Share (in dollars per share)	$ 0.08
Proceeds from Issuance of Common Stock	$ 1,630,000
Conversion of Series A Preferred Stock to Common Stock [Member]
Conversion of Stock, Shares Issued				339,000
Conversion of Stock, Shares Converted				1,501

Note 11 - Stock-based Compensation (Details Textual) - USD ($)		6 Months Ended
	Dec. 22, 2021	Jun. 30, 2024	Jun. 30, 2023	May 08, 2019
Restricted Stock [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Forfeited in Period		172,000
The 2019 Omnibus Incentive Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Available for Grant	26,072,542			11,072,542
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Additional Shares Authorized	15,000,000
Ownership Percentage	50.30%
Stock Issued During Period, Shares, Restricted Stock Award, Net of Forfeitures		525,000
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition		3 years
The 2019 Omnibus Incentive Plan [Member] \| Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Other Than Options, Grants in Period, Grant Date Fair Value		$ 77,000
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Forfeited in Period		50,000
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount		$ 288,000
Share-Based Payment Arrangement, Expense		$ 117,000	$ 82,000

Note 11 - Stock-based Compensation - Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2024	Dec. 31, 2023
Outstanding, options (in shares)	5,272
Outstanding, options, weighted average exercise price (in dollars per share)	$ 0.58
Outstanding, options, contractual life (Year)	5 years 3 months 18 days	5 years 3 months 18 days
Outstanding, options, aggregate intrinsic value	$ 0	$ 0
Options forfeited/expired (in shares)	(624)
Options forfeited/expired, weighted average exercise price (in dollars per share)	$ 1.44
Outstanding, options (in shares)	4,648	5,272
Outstanding, options, weighted average exercise price (in dollars per share)	$ 0.46	$ 0.58
Options vested and exercisable, options (in shares)	4,648
Options vested and exercisable, weighted average exercise price (in dollars per share)	$ 0.46
Options vested and exercisable, aggregate intrinsic value	$ 0

Note 11 - Stock-based Compensation - Restricted Stock Awards Activities (Details) - Restricted Stock [Member] shares in Thousands	6 Months Ended
	Jun. 30, 2024 $ / shares shares
Nonvested (in shares) \| shares	10,095
Nonvested, grant date fair value (in dollars per share) \| $ / shares	$ 0.05
Restricted stock granted (in shares) \| shares	525
Restricted stock granted, grant date fair value (in dollars per share) \| $ / shares	$ 0.041
Vested (in shares) \| shares	(3,414)
Vested, grant date fair value (in dollars per share) \| $ / shares	$ 0
Forfeited (in shares) \| shares	(172)
Forfeited, grant date fair value (in dollars per share) \| $ / shares	$ 0
Nonvested (in shares) \| shares	7,034
Nonvested, grant date fair value (in dollars per share) \| $ / shares	$ 0.063

Note 12 - Commitments and Contingencies (Details Textual) - USD ($)			3 Months Ended		6 Months Ended
	May 01, 2022	Nov. 01, 2019	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023	Jun. 15, 2023	Jun. 01, 2022
Operating Lease, Expense			$ 113,000	$ 113,000	$ 225,000	$ 225,000
Operating Lease, Liability			223,000		223,000
Operating Lease, Right-of-Use Asset			$ 219,000		219,000		$ 424,000
Chief Operating Officer [Member]
Annual Salary, Chief Executive Officer								$ 300,000
Chief Executive Officer [Member]
Annual Salary, Cut Cost								$ 225,000
Williamsville Lease [Member]
Lease, Monthly Rent	$ 1,650
Corporate Headquarters Lease [Member]
Lease, Monthly Rent		$ 22,940
Lessee, Operating Lease, Term of Contract		5 years
Operating Lease, Expense					$ 138,000	$ 138,000
Lease at 5331 Production Drive, Huntington Beach, Ca [Member]
Lessee, Operating Lease, Term of Contract									3 years

Note 12 - Commitments and Contingencies - Operating Lease Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Operating cash flows from operating leases			$ 226	$ 202
Operating lease cost	$ 113	$ 113	$ 225	$ 225
Weighted-average remaining lease term – operating leases (in years) (Year)	8 months 26 days	1 year 6 months 29 days	8 months 26 days	1 year 6 months 29 days
Weighted-average discount rate – operating leases	12.00%	12.00%	12.00%	12.00%
Variable lease cost	$ 0	$ 0	$ 0	$ 0
Operating lease expense	113	113	225	225
Short-term lease rent expense	5	5	10	10
Total rent expense	$ 118	$ 118	$ 235	$ 235

Note 12 - Commitments and Contingencies - Maturities of Operating Leases (Details)	Jun. 30, 2024 USD ($)
Nine Months Ending December 31, 2023	$ 159,000
Year Ending December 31, 2024	75,000
Total	234,000
Less present value discount	(11,000)
Operating lease liabilities as of March 31, 2023	$ 223,000

Note 13- Income Taxes (Details Textual) $ in Millions	Dec. 31, 2023 USD ($)
State and Local Jurisdiction [Member]
Operating Loss Carryforwards	$ 8.5

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