JSDA Jones Soda Co (QB)

EXPLANATORY NOTE

 

Unless otherwise indicated or the context otherwise requires, all references in this Quarterly Report on Form 10-Q (this “Report”) to “we,” “us,” “our,” “Jones,” “Jones Soda,” and the “Company” are to Jones Soda Co., a Washington corporation, and our wholly-owned subsidiaries.

 

In addition, unless otherwise indicated or the context otherwise requires, all references in this Report to “Jones Soda” refer to our premium beverages, including Jones® Soda and Lemoncocco® sold under the trademarked brand name “Jones Soda Co.®”

 

CAUTIONARY NOTICE REGARDING FORWARD LOOKING STATEMENTS

 

We desire to take advantage of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. This Report contains a number of forward-looking statements that reflect management’s current views and expectations with respect to our business, strategies, products, future results and events, and financial performance. All statements made in this Report other than statements of historical fact, including statements that address operating performance, the economy, events or developments that management expects or anticipates will or may occur in the future, including statements related to case sales, revenues, profitability, distributor channels, new products or markets, adequacy of funds from operations, cash flows and financing, potential strategic transactions, statements regarding future operating results and non-historical information, are forward-looking statements. In particular, the words such as “believe,” “expect,” “intend,” “anticipate,” “estimate,” “may,” “will,” “can,” “plan,” “predict,” “could,” “future,” “continue,” variations of such words, and similar expressions identify forward-looking statements, but are not the exclusive means of identifying such statements and their absence does not mean that the statement is not forward-looking.

 

Readers should not place undue reliance on these forward-looking statements, which are based on management’s current expectations and projections about future events, are not guarantees of future performance, are subject to risks, uncertainties and assumptions and apply only as of the date of this Report. Our actual results, performance or achievements could differ materially from historical results as well as from the results expressed in, anticipated or implied by these forward-looking statements. Except as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

 

In particular, our business, including our financial condition and results of operations may be impacted by a number of factors, including, but not limited to, the following:

 

● Our ability to successfully execute on our growth strategy and operating plans;

 

●Our ability to continue to effectively utilize the proceeds from our financings completed during the first half of 2022;

 

● Our ability to execute our plans to continue to develop and market THC/CBD-infused and/or cannabis-infused beverages and edibles, and comply with the laws and regulations governing cannabis, hemp or related products, and the timing and costs of the development of this new product line;

 

● Our ability to manage our operating expenses and generate cash flow from operations, along with our ability to secure additional financing if our sales goals take longer to achieve than anticipated;

 

● Our ability to create and maintain brand name recognition and acceptance of our products, which is critical to our success in our competitive, brand-conscious industry;

 

● Our ability to compete successfully against much larger, well-funded, established companies currently operating in the beverage industry generally, including in the fountain business, particularly from other major beverage companies;

 

● Entrance into and increased focus on the craft beverage segment by other major beverage companies;

 

 

● Our ability to respond to changes in the consumer beverage marketplace, including potential reduced consumer demand due to health concerns (including obesity) and legislative initiatives against sweetened beverages (including the imposition of taxes);

 

● Our ability to successfully develop and launch new products that match consumer beverage trends, and to manage consumer response to such new products and new initiatives;

 

● Our ability to maintain brand image and product quality and avoid risks from product issues such as product recalls;

 

● Our ability to establish, maintain and expand distribution arrangements with independent distributors, retailers, brokers and national retail accounts, most of whom sell and distribute competing products, and upon whom we rely to employ sufficient efforts in managing and selling our products, including re-stocking the retail shelves with our products;

 

● Our ability to manage our inventory levels and to predict the timing and amount of our sales;

 

● Our reliance on third-party contract manufacturers of our products and the geographic locations of their facilities, which could make management of our distribution efforts inefficient or unprofitable;

 

●Our ability to secure a continuous supply and availability of raw materials, as well as our ability to effectively respond to factors that may adversely affect our supply chain, including increases in raw material costs, and the potential shortages of glass;

 

● Our ability to source our flavors on acceptable terms from our key flavor suppliers;

 

● Our ability to attract and retain key personnel, the loss of whom would directly affect our efficiency and operations and could materially impair our ability to execute our growth strategy;

 

● Our ability to protect our trademarks and trade secrets, the failure of which may prevent us from successfully marketing our products and competing effectively;

 

● Litigation or legal proceedings, which could expose us to significant liabilities and damage our reputation;

 

● Our ability to comply with the many regulations to which our business is subject;

 

● Our ability to maintain an effective information technology infrastructure;

 

●Failures or security breaches of our information technology systems could disrupt our operations and negatively impact our business;

 

● Fluctuations in fuel and freight costs;

 

● Fluctuations in currency exchange rates, particularly between the United States and Canadian dollars;

 

● Regional, national or global economic, political, social and other conditions that may adversely impact our business and results of operations;

 

● Our ability to maintain effective disclosure controls and procedures and internal control over financial reporting;

 

● Dilutive and other adverse effects on our existing shareholders and our stock price arising from future securities issuances; and

 

● Our ability to access the capital markets for any future equity financing, and any actual or perceived limitations to our common stock by being traded on the OTCQB Marketplace and the Canadian Stock Exchange, including the level of trading activity, volatility or market liquidity.

 

For a discussion of some of the factors that may affect our business, results and prospects, see “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022 filed with the Securities and Exchange Commission (“SEC”) on March 29, 2023 and in our other reports we file with the SEC, including our periodic reports on Form 10-Q and current reports on Form 8-K. Readers are also urged to carefully review and consider the various disclosures made by us in this Report and in our other reports we file with the SEC, including our periodic reports on Forms 10-Q and current reports on Form 8-K, and those described from time to time in our press releases and other communications, which attempt to advise interested parties of the risks and factors that may affect our business, prospects and results of operations.

 

 

PART 1 – FINANCIAL INFORMATION

ITEM 1.

FINANCIAL STATEMENTS

 

JONES SODA CO.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

 

See accompanying notes to condensed consolidated financial statements.

 

 

JONES SODA CO.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

See accompanying notes to condensed consolidated financial statements.

 

 

JONES SODA CO.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(Unaudited)

 

 

See accompanying notes to condensed consolidated financial statements.

 

 

JONES SODA CO.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(Unaudited)

 

 

See accompanying notes to condensed consolidated financial statements.

 

 

JONES SODA CO.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

See accompanying notes to condensed consolidated financial statements.

 

 

JONES SODA CO.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 

1.	Nature of Operations and Summary of Significant Accounting Policies

 

Jones Soda Co. develops, produces, markets and distributes premium beverages which it sells and distributes primarily in the United States and Canada through its network of independent distributors and directly to its national and regional retail accounts. 

 

In addition, following the closing of the Plan of Arrangement (See note 4(d)), we have expanded our business to the production of cannabis-containing beverages and related products.

 

We are a Washington corporation and have six subsidiaries, Jones Soda Co. (USA) Inc., Jones Soda (Canada) Inc., Jones Soda Cannabis Inc., Mary Jones California, LLC, Mary Jones Michigan, LLC, and Pinestar Gold Inc. (Subsidiaries).

 

Basis of presentation, consolidation and use of estimates

 

The accompanying condensed consolidated balance sheet as of December 31, 2022, which has been derived from our audited consolidated financial statements, and unaudited interim condensed consolidated financial statements as of June 30, 2023, have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the Securities and Exchange Commission (“SEC”) rules and regulations applicable to interim financial reporting. The condensed consolidated financial statements include our accounts and the accounts of our subsidiaries. All intercompany transactions between us and our subsidiaries have been eliminated in consolidation.

 

In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all material adjustments, consisting only of those of a normal and recurring nature, considered necessary for a fair presentation of our financial position, results of operations and cash flows at the dates and for the periods presented.  Preparing financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. Significant items subject to such estimates and assumptions include, but are not limited to, inventory valuation, depreciable lives and valuation of capital assets, valuation allowances for receivables, trade promotion liabilities, stock-based compensation expense, valuation allowance for deferred income tax assets, contingencies, and forecasts supporting the going concern assumption and related disclosures. Actual results could differ from those estimates. The operating results for the interim periods presented are not necessarily indicative of the results expected for the full year. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022.

 

Liquidity

 

As of June 30, 2023 and December 31, 2022, we had cash and cash-equivalents of approximately $5.1 million and $8.0 million, respectively, and working capital of approximately $9.7 million and $11.6 million, respectively. Net cash used in operations during the six months ended June 30, 2023 and 2022 totaled approximately $2.5 million and $4.3 million, respectively. Net cash used in operations decreased primarily due to the decrease in start-up expenses related to the launch of the cannabis-containing beverages and related products for the six months ended  June 30, 2023.

 

We did not receive any cash from the exercise of stock options as of June 30, 2023 or 2022. From time to time, we may receive additional cash through the exercise of stock options or stock warrants. However, we cannot predict the timing or amount of cash proceeds we may receive from the exercise, if at all, of any of the outstanding stock options or warrants.

 

We intend to continually monitor and adjust our operating plan as necessary to respond to developments in our business, our markets and the broader economy.

 

As of the date of this Report and as a result of our cash on hand, we believe that our current cash and cash equivalents will be sufficient to meet the Company’s funding requirements for one year after these condensed consolidated financial statements are issued.

 

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Seasonality and other fluctuations

 

Our sales are seasonal and we experience fluctuations in quarterly results as a result of many factors. We historically have generated a greater percentage of our revenues during the warm weather months of April through September. Sales may fluctuate materially on a quarter to quarter basis or an annual basis when we launch a new product or fill the “pipeline” of a new distribution partner or a large retail partner. Sales results may also fluctuate based on the number of stock keeping units (“SKU”) selected or removed by our distributors and retail partners through the normal course of serving consumers in the dynamic, trend-oriented beverage industry. As a result, management believes that period-to-period comparisons of results of operations are not necessarily meaningful and should not be relied upon as any indication of future performance or results expected for the fiscal year.

 

Revenue recognition

 

Our contracts have a single performance obligation which is satisfied at the point in time when the customer has title and the significant risks and rewards of ownership of the product. Title and the significant risk and rewards of ownership are deemed to transfer when products are loaded onto a truck for shipment or Free on Board (“FOB”) shipping point. We primarily receive fixed consideration for sales of product, subject to adjustment as described below. Shipping and handling amounts paid by customers are primarily for online orders, and are included in revenue, and totaled $45,000 and $54,000 for the three months ended June 30, 2023 and 2022, respectively, and $86,000 in each of the six month periods ended June 30, 2023 and 2022. Sales tax and other similar taxes are excluded from revenue. 

 

See Note 1, on our most recently filed Form 10-K filed on March 29, 2023 for our revenue recognition policy. 

 

Revenue is recorded net of provisions for discounts, slotting fees payable by us to retailers to stock our products and promotion allowances. Discounts, slotting fees and promotional allowances vary the consideration we are entitled to in exchange for the sale of products to distributors. We estimate these discounts, slotting fees and promotional allowances in the same period that the revenue is recognized for product sales to customers. These estimates are based on contract terms and our historical experience with similar programs and require management judgement with respect to estimating customer participation and performance levels. Differences between estimated expense and actual costs are normally insignificant and are recognized in earnings in the period such differences are determined. The amount of revenue recognized represents the amount that will not be subject to a significant future reversal of revenue. The liability for promotional allowances is included in accrued expenses on the consolidated balance sheets. Amounts paid for slotting fees are recorded as prepaid expenses on the consolidated balance sheets and amortized over the corresponding term. For the quarters ended June 30, 2023 and 2022, our revenue was reduced by $394,000 and $451,000, respectively, and for the six months ended June 30, 2023 and 2022, by $699,000 and $759,000, respectively, in each case for slotting fees and promotion allowances.

 

All sales to distributors and customers are generally final. In limited instances we may accept returned product due to quality issues or distributor terminations, and in such situations we would have variable consideration. To date, returns have not been material. Our customers generally pay within 30 days from the receipt of a valid invoice. We offer prompt pay discounts of up to 2% to certain customers typically for payments made within 15 days. Prompt pay discounts are estimated in the period of sale based on experience with sales to eligible customers. Early pay discounts are recorded as a deduction to the accounts receivable balance presented on the condensed consolidated balance sheets.

 

The accounts receivable balance primarily includes balances from trades sales to distributors and retail customers. The allowance for doubtful accounts is the best estimate of the amount of probable credit losses in existing accounts receivable. We determine the allowance for doubtful accounts based primarily on historical write-off experience. Account balances that are deemed uncollectible are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. Allowances for doubtful accounts of $145,000 and $110,000 as of June 30, 2023 and December 31, 2022, respectively, were netted against accounts receivable. No impairment losses were recognized for the three or six months ended  June 30, 2023 and for the year ended December 31, 2022. Changes in accounts receivable are primarily due to the timing and magnitude of orders for products, the timing of when control of products is transferred to distributors and the timing of cash collections.

 

As of June 30, 2023, one of our independent customers made up 13% of our outstanding accounts receivable. As of December 31, 2022, two customers made up 22% of our outstanding accounts receivable.

 

Net loss per share

 

Basic net loss per share is computed using the weighted average number of common shares outstanding during the periods. Diluted earnings per share is computed by adjusting the weighted average number of common shares by the effective net exercise or conversion of all dilutive securities. Due to the net loss during the three and six months ended June 30, 2023 and 2022, outstanding stock options amounting to 12,154,480 and 3,206,832 

shares were anti-dilutive, Additionally, outstanding warrants of  27,721,945 for each of the periods ended June 30, 2023 and 2022 were also anti-dilutive. 

 

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Recent accounting pronouncements

 

No new accounting pronouncements issued or effective during 2023 had, or are expected to have, a material impact on the Company’s consolidated financial statements. 

 

  

2.

Inventory

 

Inventory consisted of the following (in thousands):

 

		June 30, 2023				December 31, 2022
Finished goods		$	1,362			$	1,234
Raw materials			1,176				1,387
		$	2,538			$	2,621

 

Finished goods primarily include product ready for shipment, as well as promotional merchandise held for sale. Raw materials primarily include ingredients, concentrate and packaging. For the three months ended June 30, 2023 and 2022, we recorded obsolete inventory expenses of $13,000 and $9,000, respectively. For the six months ended June 30, 2023 and 2022, we recorded obsolete inventory expenses of $19,000 and $22,000, respectively. 

 

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3.	Convertible Debentures

 

2018 Convertible Subordinated Note Payable

 

On March 23, 2018, and April 18, 2018, we issued and sold an aggregate principal amount of $2,920,000 of convertible subordinated promissory notes (the “2018 Convertible Notes”) to institutional investors, our management team, and other individual investors.

 

The 2018 Convertible Notes had a four-year term from the date of issuance and bared interest at 6% per annum. The 2018 Convertible Notes matured in two tranches on March 23, 2022, and April 18, 2022. The holders had the option to convert the 2018 Convertible Notes at any time prior to maturity into the number of shares of our common stock equal to the quotient obtained by dividing (i) the amount of the unpaid principal and interest on such 2018 Convertible Note by (ii) $0.32 (the “Conversion Price”). The Conversion Price was subject to anti-dilution adjustment on a broad-based, weighted average basis if we issued shares or equity-linked instruments at a conversion price below $0.32 per share. No payments of principal or interest were due until the maturity.

 

The 2018 Convertible Notes were subordinated in right of payment to the prior payment in full of all of our Senior Indebtedness, which was defined as amounts due in connection with our indebtedness for borrowed money to banks, commercial finance lenders, or other lending institutions regularly engaged in the business of lending money, with certain restrictions.

 

The fair value of our common stock on the March 23, 2018, closing date for the issuance of the first tranche of the 2018 Convertible Notes was $0.36 per share, therefore, the 2018 Convertible Notes issued on that date contained a beneficial conversion feature with an aggregate intrinsic value of $350,000. The fair value of our common stock on the April 18, 2018, the closing date for the issuance of the second tranche of the 2018 Convertible Notes, was $0.30 per share, which did not result in an additional beneficial conversion feature. The resulting debt discount for the 2018 Convertible Notes issued on March 23, 2018 was presented as a direct deduction from the carrying value of the 2018 Convertible Notes and was recorded with an increase to additional paid-in capital. The discount along with the related closing costs amounting to $137,000 were amortized through interest expense over the term of the 2018 Convertible Notes. On April 18, 2022, the last remaining outstanding 2018 Convertible notes matured and no 2018 Convertible Notes remain outstanding.

 

2021 Unsecured Convertible Debenture

 

On  July 14, 2021, we issued a $2,000,000 5.00% unsecured convertible debenture due July 14, 2023 (the “2021 Debenture”) to SOL Verano Blocker 1 LLC that was convertible into units of the Company (each a “Jones Unit”) at a conversion price of $0.50 per Jones Unit, with each Jones Unit consisting of one share of our common stock and one share purchase special warrant of Jones (each a “Jones Special Warrant”). Each Jones Special Warrant was exercisable into one share of our common stock at a price of $0.625 per share for a period of 24 months from the date of issuance, conditional upon us increasing our authorized capital to an amount to cover our shares of common stock issuable pursuant to all of the outstanding Jones Special Warrants as well as the other shares of our common stock issuable pursuant to our then-outstanding convertible/exercisable securities.

 

The closing of the statutory plan of arrangement under the Business Corporations Act (British Columbia) (the “Plan of Arrangement”) with Pinestar Gold Inc. (“Pinestar”) in February 2022 resulted in the automatic conversion of the 2021 Debenture into an aggregate of 4,025,035 shares of our common stock and 4,025,035 Jones Special Warrants at a conversion price of $0.50 per share of common stock and Jones Special Warrant. As a result, the carrying amount of the converted principal amount of such 2021 Unsecured Convertible Debenture, in an aggregate amount of $2,000,000, was credited to common stock.

 

2022 Unsecured Convertible Debenture

 

On February 9, 2022, we issued $3,000,000 in aggregate principal amount of 3.00% unsecured convertible debentures due February 9, 2023 (the “Contingent Convertible Debentures”), which were converted into Jones Units at a conversion price of $0.50 per Jones Unit on May 16, 2022. The Contingent Convertible Debentures were automatically convertible into Jones Units upon Jones Soda increasing its authorized capital to an amount to cover our shares of common stock issuable pursuant to all of the outstanding Contingent Convertible Debentures as well as all of the other then outstanding convertible/exercisable securities of Jones (a “Conversion Event”). The Contingent Convertible Debentures were only convertible into Jones Units upon the occurrence of a Conversion Event. The Contingent Convertible Debentures were set to mature on February 9, 2023 (the “Convertible Debenture Maturity Date”) and began accruing interest at a rate of 3.00% commencing on April 1, 2022. Under the terms of the Contingent Convertible Debentures, the Company covenanted to the holders of the Contingent Convertible Debentures that the Company will use their commercially reasonable efforts to cause the Conversion Event to occur as soon as practicable after the closing of the Plan of Arrangement. The related closing costs amounting to $108,000 were amortized through interest expense over the term of the Contingent Convertible Debentures. On May 16, 2022 all Contingent Convertible Debentures were converted into Jones Units, and the remaining unamortized capitalized closing costs were expensed.

 

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4.	Shareholders’ Equity

 

On May 16, 2022, our shareholders approved the adoption of the Jones Soda Co. 2022 Omnibus Equity Incentive Plan (the "2022 Plan"), which replaced the 2011 Plan (defined below) and provides for the granting incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock, restricted stock units and other stock-based awards to participants to acquire shares of Company common stock under the 2022 Plan. Under the terms of the 2022 Plan, the sum of (i) 10,000,000 shares of the Company’s common stock, plus (ii) the number of shares of common stock reserved, but unissued under the 2011 Plan, plus (iii) the number of shares of common stock underlying forfeited awards under the 2011 Plan are initially available for issuance as awards under the 2022 Plan.

 

1,936,074 shares of common stock reserved under the terms of our 2011 Incentive Plan (the “2011 Plan”) but unissued were transferred to the reserve for the 2022 Plan. Thus, the total number of shares of common stock authorized under the 2022 Plan was 11,936,074 shares.

 

Under the terms of the 2022 Plan, the Board may grant awards to employees, officers, directors, consultants, agents, advisors and independent contractors. Stock options are granted with an exercise price equal to the closing price of our stock on the date of grant, and generally have a ten-year term. As of June 30, 2023, there were 762,074 shares of unissued common stock authorized and available for future awards under the Plan.

 

(a)	Stock options:

 

A summary of our stock option activity is as follows:

 

		Outstanding Options
		Number of Shares				Weighted Average Exercise Price (Per Share)
Balance at January 1, 2023			3,369,332			$	0.41
Options granted			9,659,000				0.23
Options forfeited/expired			(873,852	)			0.27
Balance at June 30, 2023			12,154,480			$	0.27
Exercisable, June 30, 2023			3,745,895			$	0.33
Vested and expected to vest			10,142,892			$	0.28

 

		Outstanding Options
		Number of Shares				Weighted Average Exercise Price (Per Share)
Balance at January 1, 2022			3,405,511			$	0.38
Options granted			625,648				0.54
Options forfeited/expired			(824,327	)			0.41
Balance at June 30, 2022			3,206,832			$	0.41
Exercisable, June 30, 2022			2,395,258			$	0.32
Vested and expected to vest			2,975,046			$	0.39

 

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(b)	Restricted stock awards:

 

Beginning on May 13, 2022, the Company’s board of directors (the “Board”) determined that it was in the best interests of the Company to periodically award restricted stock units as equity compensation for non-employee directors upon the recommendation of the Compensation and Governance Committee of the Board in lieu of stock options. Each restricted stock unit granted vests incrementally over the period in the specific award agreement, and certain restricted stock awards will immediately vest upon the occurrence of a "Change in Control" as defined in the 2022 Plan.

 

On December 30, 2022, the Company entered into rescission agreements (the “Rescission Agreements”) with the certain non-employee directors on the Board who were awarded restricted stock units during 2022 as well as the Company’s Chief Executive Officer and President who received restricted stock units during 2022 under the terms of his employment agreement with the Company. Under the terms of the Rescission Agreements, each of the Company and the applicable restricted stock unit grantee, agreed to rescind and cancel for no consideration all currently outstanding restricted stock units previously granted to each such grantee during 2022 as well as all shares of the Company’s common stock previously issued to any such grantee as a result of the vesting of any restricted stock units in August 2022.

 

In May of 2023, the Board determined that it was in the best interests of the Company to revise the Board of Director compensation structure to consist of annual grant of 300,000 stock options to each non-employee director each year for service on the Board and an additional 150,000 stock options as annual compensation for non-employee directors who serve as chair of a Board committee. All stock options granted to non-employee directors will vest incrementally in equal amounts over a three year period from the date of issuance.

 

A summary of our restricted stock activity for the six months ended June 30, 2023 is as follows:

 

		Restricted Shares				Weighted-Average Grant Date Fair Value per share				Weighted-Average Contractual Life (years)
Non-vested restricted stock at January 1, 2023			-			$	-				-
Granted			1,800,000				0.26
Vested			(1,200,000	)			0.26
Cancelled/expired			-				-
Non-vested restricted stock at June 30, 2023			600,000			$	0.26				9.6

 

We withheld a total of 480,000 shares as payment for withholding taxes due in connection with the vesting of restricted stock awards during the six months ended June 30, 2023, and the price paid per share of $0.26 reflects the market value per share of the shares withheld for tax purposes. 

 

(c)	Stock-based compensation expense:

 

Stock-based compensation expense is recognized using the straight-line attribution method over the employees’ requisite service period, or the non-employee's service period based on the term of the contract. We recognize compensation expense for only the portion of stock options or restricted stock expected to vest. Therefore, we apply estimated forfeiture rates that are derived from historical employee attrition. If the actual number of forfeitures differs from those estimated by management, additional adjustments to stock-based compensation expense may be required in future periods.

 

At June 30, 2023, we had unrecognized compensation expense related to stock options of $618,000 to be recognized over a weighted-average period of 2.5 years.

 

The following table summarizes the stock-based compensation expense (in thousands):

 

		Three months ended June 30,								Six months ended June 30,
		2023				2022				2023				2022
Stock options		$	118			$	23			$	331			$	292
Common stock award			-				-				17				-
Restricted stock			156				94				192				94
		$	274			$	117			$	540			$	386
Income statement account:
Selling and marketing		$	23			$	18			$	45			$	109
General and administrative			251				99				495				277
		$	274			$	117			$	540			$	386

 

The Company issued a common stock award of 75,000 shares under the 2022 Plan pursuant to a consulting agreement that resulted in $17,000 of stock compensation expense as seen in the above table. 

 

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We employ the following key weighted-average assumptions in determining the fair value of stock options, using the Black-Scholes option pricing model and the simplified method to estimate the expected term of “plain vanilla” options:

 

		Six months ended June 30,
		2023				2022
Expected dividend yield			—				—
Expected stock price volatility			87.5	%			78.3	%
Risk-free interest rate			3.9	%			1.7	%
Expected term (in years)			5.8				5.9
Weighted-average grant date fair-value		$	0.17			$	0.37

 

The aggregate intrinsic value of stock options outstanding at June 30, 2023 was approximately $74,000 and for options exercisable was also $40,000. The intrinsic value of outstanding and exercisable stock options is calculated as the quoted market price of the stock at the balance sheet date less the exercise price of the option. There were no options exercised during the three or six months ended June 30, 2023 and 2022.

 

(d)	Closing of the Pinestar Gold Inc. - Plan of Arrangement:

 

On February 15, 2022, Jones issued an aggregate of 20,000,048 shares of our common stock in connection with the completion the Plan of Arrangement whereby the outstanding common shares of Pinestar (“Pinestar Shares”) were exchanged for newly issued shares of our common stock on a one-for-one basis. The Plan of Arrangement had previously been approved by both Pinestar’s shareholders as well as by the Supreme Court of British Columbia after such court held a hearing on the fairness of the terms and conditions of the Plan of Arrangement at which all Pinestar shareholders had the right to appear.

 

In connection with the Plan of Arrangement, Pinestar completed a subscription receipt offering for aggregate net proceeds of $7,152,000, at a price per subscription receipt equal to $0.50. As part of the closing of the Plan of Arrangement, each such subscription receipt automatically converted into one Pinestar Share and one new common share purchase warrant of Pinestar, which were then immediately exchanged for shares of our common stock and Jones Special Warrants, respectively, in accordance with a 1:1 exchange ratio.

 

The issuance of shares of our common stock to the holders of Pinestar Shares (including Pinestar Shares received upon the conversion of the subscription receipts issued in the Pinestar subscription receipt offering) in the Plan of Arrangement was exempt from the registration requirements under the United States Securities Act of 1933, as amended (the “Securities Act”) pursuant to Section 3(a)(10) of the Securities Act, which exempts from the registration requirements under the Securities Act any securities that are issued in exchange for one or more bona fide outstanding securities where the terms and conditions of such issuance and exchange are approved, after a hearing upon the fairness of such terms and conditions at which all persons to whom it is proposed to issue securities in such exchange shall have the right to appear, by any court expressly authorized by law to grant such approval.

 

The following table summarizes the Company's outstanding warrants as of June 30, 2023:

		Number Outstanding				Remaining Contractual Life (Years)				Exercise Price Per Share				Number Exercisable
Jones Special Warrants (1)			26,047,137				0.71			$	0.63	USD			26,047,137
Pinestar Warrants (2)			1,674,808				0.75				0.06	CAD			1,674,808
			27,721,945												27,721,945

 

(1) Upon conversion of the beforementioned 2021 Debenture, 4,025,035 Jones Special Warrants were issued. In connection with the beforementioned Plan of Arrangement, Pinestar completed an offering for subscription receipts for aggregate gross proceeds of $8,000,000. Pursuant to the Plan of Arrangement, each subscription receipt automatically converted into 16,000,000 Jones Special Warrants. Lastly, Upon conversion of the beforementioned Contingent Convertible Debentures, 6,022,102 Jones Special Warrants were issued.

 

(2) In connection with the beforementioned Plan of Arrangement, 1,674,808 warrants to purchase Pinestar Shares at a price of $0.06 CAD per share were assumed by the Company and became exercisable into shares of our common stock. An aggregate of 600,000 of such warrants were subsequently transferred to two members of our Board of Directors as consideration for services provided by such directors to the Company during 2022.

 

16

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5.	Segment Information

 

We have one operating segment with operations primarily in the United States and Canada. Sales are assigned to geographic locations based on the location of customers. Sales by geographic location are as follows (in thousands):

 

		Three months ended June 30,								Six months ended June 30,
		2023				2022				2023				2022
Revenue:
United States		$	3,814			$	4,810			$	7,043			$	8,440
Canada			952				1,142				1,593				2,035
Other countries			40				63				40				63
Total revenue		$	4,806			$	6,015			$	8,676			$	10,538

 

During the three months ended June 30, 2023 and 2022, one of our customers (Lassonde) represented an aggregate of approximately 19% and 24% of our revenue, respectively. 

 

  

6.	Insurance Premium Financing

 

Effective November 15, 2021, the Company entered into a one year financing agreement with IPFS Corporation to fund a portion of its insurance premiums in the amount of $903,000. Repayments were made quarterly on January 15, 2022, April 15, 2022, and July 15, 2022, and the entirety of the financing was paid off in full on July 15, 2022. The interest rate was 4.75% and there were no covenants associated with this agreement.

 

Effective November 15, 2022, the Company entered into a one year financing agreement with IPFS Corporation to fund a portion of its insurance premiums in the amount of $612,000. Repayments are made quarterly on January 15, 2023, April 15, 2023, and by July 15, 2023, the entirety of the financing was paid off in full. The interest rate is 6.99% and there are no covenants associated with this agreement. As of June 30, 2023, the principal balance was $203,000.

 

17

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Table of Contents

  

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

 

You should read the following discussion and analysis in conjunction with our unaudited condensed consolidated financial statements and related notes included elsewhere in this Report and the 2022 audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission (“SEC”) on March 29, 2023.

 

This Report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “believe,” “expect,” “intend,” “anticipate,” “estimate,” “may,” “will,” “can,” “plan,” “predict,” “could,” “future,” “continue,” variations of such words, and similar expressions. These statements are only predictions. Actual events or results may differ materially. In evaluating these statements, you should specifically consider various factors, including the risks outlined at the beginning of this Report under “Cautionary Notice Regarding Forward-Looking Statements” and in Item 1A of our most recent Annual Report on Form 10-K filed with the SEC, and in our other reports we file with the SEC, including our periodic reports on Form 10-Q and current reports on Form 8-K. These factors may cause our actual results to differ materially from any forward-looking statements. Except as required by law, we undertake no obligation to publicly release any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

 

Overview

 

We develop, produce, market and distribute premium beverages that we sell and distribute primarily in the United States and Canada through our network of independent distributors and directly to our national and regional retail accounts. We also sell products in select international markets. Our products are sold in grocery stores, convenience and gas stores, on fountain in restaurants, “up and down the street” in independent accounts such as delicatessens, sandwich shops and burger restaurants, as well as through our national accounts with several large retailers. We refer to our network of independent distributors as our direct store delivery (“DSD”) channel, and we refer to our national and regional accounts who receive shipments directly from us as our direct to retail (“DTR”) channel. We do not directly manufacture our products, but instead outsource the manufacturing process to third-party contract manufacturers. We also sell various products online, including soda with customized labels, wearables, candy and other items, and we license our trademarks for use on products sold by other manufacturers.

 

Our Focus: Sales Growth

 

Our focus is sales growth through execution of the following key initiatives:

 

●

Expand the Jones Soda glass bottle business in existing and new sales channels;

 

●

Expand our fountain program in the United States and Canada;

 

●

Grow the new brand of Tetrahydrocannabinol (THC) and cannabidiol (CBD)-infused beverages, edibles, and other related products; and,

 

●

Increase distribution of Lemoncocco in the United States and Canada.

 

 

Results of Operations

 

The following selected financial and operating data are derived from our condensed consolidated financial statements and should be read in conjunction with our condensed consolidated financial statements.

 

		Three months ended June 30,																Six months ended June 30,
		2023				% of Revenue				2022				% of Revenue				2023				% of Revenue				2022				% of Revenue
Consolidated statements of operations data:		(Dollars in thousands, except per share data)																(Dollars in thousands, except per share data)
Revenue		$	4,806				100.0	%		$	6,015				100.0	%		$	8,676				100.0	%		$	10,538				100.0	%
Cost of goods sold			(3,247	)			(67.6	)%			(4,328	)			(72.0	)%			(5,982	)			(68.9	)%			(7,614	)			(72.3	)%
Gross profit			1,559				32.4	%			1,687				28.0	%			2,694				31.1	%			2,924				27.7	%
Selling and marketing expenses			(1,080	)			(22.5	)%			(1,076	)			(17.9	)%			(2,112	)			(24.3	)%			(2,219	)			(21.1	)%
General and administrative expenses			(1,508	)			(31.4	)%			(1,882	)			(31.3	)%			(2,964	)			(34.2	)%			(3,404	)			(32.3	)%
Loss from operations			(1,029	)			(21.4	)%			(1,271	)			(21.1	)%			(2,382	)			(27.5	)%			(2,699	)			(25.6	)%
Interest income			18				0.4	%			2				0.0	%			18				0.2	%			4				0.0	%
Interest expense			-				0.0	%			(146	)			(2.4	)%			-				0.0	%			(377	)			(3.6	)%
Other income (expense), net			4				0.1	%			(11	)			(0.2	)%			(1	)			(0.0	)%			(11	)			(0.1	)%
Loss before income taxes			(1,007	)			(21.0	)%			(1,426	)			(23.7	)%			(2,365	)			(27.3	)%			(3,083	)			(29.3	)%
Income tax expense, net			(17	)			(0.4	)%			(9	)			(0.1	)%			(22	)			(0.3	)%			(16	)			(0.2	)%
Net loss		$	(1,024	)			(21.3	)%		$	(1,435	)			(23.9	)%		$	(2,387	)			(27.5	)%		$	(3,099	)			(29.4	)%
Basic and diluted net loss per share		$	(0.01	)						$	(0.02	)						$	(0.02	)						$	(0.04	)

 

		As of
		June 30, 2023				December 31, 2022
Balance sheet data:		(Dollars in thousands)
Cash and cash equivalents and accounts receivable, net		$	8,608			$	11,141
Fixed assets, net			121				127
Total assets			12,657				15,102
Long-term liabilities			-				-
Working capital			9,735				11,640

 

Seasonality and Other Fluctuations

 

Our sales are seasonal and we experience fluctuations in quarterly results as a result of many factors. We historically have generated a greater percentage of our revenues during the warm weather months of April through September. Sales may fluctuate materially on a quarter to quarter basis or an annual basis when we launch a new product or fill the “pipeline” of a new distribution partner or a large retail partner. Sales results may also fluctuate based on the number of stock keeping units or "SKUs" selected or removed by our distributors and retail partners through the normal course of serving consumers in the dynamic, trend-oriented beverage industry. As a result, management believes that period-to-period comparisons of results of operations are not necessarily meaningful and should not be relied upon as any indication of future performance or results expected for the fiscal year.

 

 

Quarter Ended June 30, 2023 Compared to Quarter Ended June 30, 2022

 

Revenue

 

For the quarter ended June 30, 2023, revenue decreased by approximately $1.2 million, or 20.1%, to approximately $4.8 million compared to approximately $6.0 million for the quarter ended June 30, 2022. The decrease in sales revenue in the second quarter of 2023 compared to the second quarter of 2022 was primarily the result of approximately $1 million in revenues from core bottle soda sales from a one-time inventory stocking event with one of our largest customers in 2022 that was not repeated in 2023.

 

For the quarter ended June 30, 2023, trade spend and promotion allowances, which reduced the amount of revenue for the sales of our product, totaled approximately $394,000, a decrease of approximately $57,000, or 12.6%, compared to approximately $451,000 for the quarter ended June 30, 2022, primarily due to the timing of incentive and retailer programs. 

 

Gross Profit

 

For the quarter ended June 30, 2023, gross profit decreased by approximately $128,000, or 7.6%, to approximately $1.6 million compared to approximately $1.7 million for the quarter ended June 30, 2022 as a result of lower sales revenue in the current quarter. For the quarter ended June 30, 2023, gross margin increased to 32.4% from 28.0% for the quarter ended June 30, 2022. This increase was primarily driven by proactive pricing adjustments in 2023 and continued supply chain management to lower raw material and freight costs.

 

Selling and Marketing Expenses

 

Selling and marketing expenses for the second quarter ended June 30, 2023 remained flat at approximately $1.1 million in comparison to the quarter-ended June 30, 2022. Our sales expenses increased by approximately $100,000 in the current quarter primarily due to increased sales team headcount which was offset by approximately $100,000 in reduced marketing spend for the current quarter. We continue to invest in marketing, however, due to timing of specific programs in 2022 versus 2023, we experienced lower marketing expenses in the second quarter of 2023 in comparison to the second quarter of 2022. Selling and marketing expenses as a percentage of revenue increased to 22.5% in the second quarter ended June 30, 2023 from 17.9% in the same period in 2022. We intend to continue to balance selling and marketing expenses with our working capital resources. For the three months ended June 30, 2023 and 2022, non-cash expenses included in selling and marketing expenses (stock compensation and depreciation) were approximately $28,000 and $30,000, respectively.

 

General and Administrative Expenses

 

General and administrative expenses for the second quarter ended June 30, 2023 were approximately $1.5 million, a decrease of approximately $374,000, or 19.9%, compared to approximately $1.9 million for the first quarter ended June 30, 2022. This decrease was primarily a result of fewer general business start-up costs associated with the development of our Mary Jones Brand in the second quarter of 2023 compared to the same quarter of 2022. General and administrative expenses as a percentage of revenue decreased slightly to 31.4% in the second quarter ended June 30, 2023 from 34.3% in the same quarter in 2022. We intend to continue to carefully manage general and administrative expenses with our working capital resources. For the three months ended June 30, 2023 and 2022, non-cash expenses included in general and administrative expenses (stock compensation and depreciation) were approximately $268,000 and $103,000, respectively. The increase in non-cash expenses included in general and administrative expenses in the second quarter of 2023 was primarily due to increased stock options granted to the Company’s officers and members of the Company’s Board of Directors in the current quarter ended June 30, 2023 compared to the quarter ended June 30, 2022. 

 

Interest Income

 

We earned approximately $18,000 of interest income for the quarter ended June 30, 2023, compared to $2,000 for the quarter ended June 30, 2022. This increase is primarily due to the increase in interest rates.

 

Interest Expense

 

We incurred no interest expense for the quarter ended June 30, 2023, compared to approximately $146,000 for the quarter ended June 30, 2022. The $146,000 interest expense in the second quarter of 2022 was primarily related to the conversions of both the Contingent Convertible Debentures and the remaining Convertible Notes (each as defined in Note 4) that resulted in all capitalized costs associated with the issuance of these notes being fully expensed upon conversion. The interest expense incurred during the quarters ended June 30, 2022 was non-cash. 

 

 

Income Tax Expense

 

We incurred approximately $17,000 and $9,000 of income tax expense during the quarters ended June 30, 2023 and 2022, respectively, primarily related to the tax provision on income from our Canadian operations. We have not recorded any tax benefit for the loss in our U.S. operations as we have recorded a full valuation allowance on our U.S. net deferred tax assets. We expect to continue to record a full valuation allowance on our U.S. net deferred tax assets until we sustain an appropriate level of taxable income through improved U.S. operations. Our effective tax rate is based on recurring factors, including the forecasted mix of income before taxes in various jurisdictions, estimated permanent differences and the recording of a full valuation allowance on our U.S. net deferred tax assets.

 

Net loss

 

Net loss for the quarter ended June 30, 2023 was approximately $1.0 million compared to net loss of approximately $1.4 million for the quarter ended June 30, 2022. This decrease in net loss was primarily due to the decreased General and Administrative costs associated with the development of our Mary Jones Brand in 2023 and the decrease in interest expense being partially offset by reduced revenues in the second quarter of 2023 compared to the second quarter of 2022.

 

 

Six months Ended June 30, 2023 Compared to six months Ended June 30, 2022

 

Revenue

 

For the six months ended June 30, 2023, revenue decreased by approximately $1.9 million, or 17.7%, to approximately $8.7 million compared to approximately $10.5 million for the six months ended June 30, 2022. The decrease in sales revenue in the first and second quarters of 2023 compared to the first and second quarters of 2022 was primarily the result of $1.5 million in revenues from core bottle soda sales from a one-time inventory stocking event with one of our largest customers in 2022 that was not repeated during the first half of 2023.

 

For the six months ended June 30, 2023, trade spend and promotion allowances, which reduced the amount of revenue for the sales of our product, totaled approximately $699,000, an increase of approximately $60,000, or 7.9%, compared to approximately $759,000 for the six months ended June 30, 2022, primarily due to the timing of incentive and retailer programs. 

 

Gross Profit

 

For the six months ended June 30, 2023, gross profit decreased by approximately $230,000, or 7.9%, to approximately $2.7 million compared to approximately $2.9 million for the six months ended June 30, 2022 as a result of lower sales revenue in the current six month period. For the six months ended June 30, 2023, gross margin increased to 31.1% from 27.7% for the six months ended June 30, 2022. This increase was primarily driven by proactive pricing adjustments and continued supply chain management to lower raw material and freight costs.

 

Selling and Marketing Expenses

 

Selling and marketing expenses for the six months ended June 30, 2023 decreased by approximately $107,000 to $2.1 million in comparison to $2.2 million for the six months ended June 30, 2022. We continue to invest in marketing, but our marketing costs in the first six months of 2023 decreased compared to the same six month period of 2022 mostly due to timing of specific programs. Selling and marketing expenses as a percentage of revenue increased to 24.3% in the six months ended June 30, 2023 from 21.1% in the same period in 2022. We intend to continue to balance selling and marketing expenses with our working capital resources. For the six months ended June 30, 2023 and 2022, non-cash expenses included in selling and marketing expenses (stock compensation and depreciation) were approximately $55,000 and $134,000, respectively.

 

General and Administrative Expenses

 

General and administrative expenses for the six months ended June 30, 2023 were approximately $3.0 million, a decrease of approximately $440,000, or 12.9%, compared to approximately $3.4 million for the six months ended June 30, 2022. This decrease was primarily a result of fewer general business start-up costs associated with the development of our Mary Jones Brand in the first half of 2023 compared to the same period of 2022. General and administrative expenses as a percentage of revenue increased to 34.2% in the six month period ended June 30, 2023 from 32.3% in the same period in 2022. We will continue to carefully manage general and administrative expenses with our working capital resources. For the six months ended June 30, 2023 and 2022, non-cash expenses included in general and administrative expenses (stock compensation and depreciation) were approximately $515,000 and $281,000, respectively. The increase in non-cash expenses included in general and administrative expenses is primarily due to increased stock options granted to the Company’s officers and members of the Company’s Board of Directors during the six months ended June 30, 2023 compared to the six months ended June 30, 2022. 

 

Interest Income

 

We earned approximately $18,000 of interest income for the six months ended June 30, 2023, compared to $4,000 for the six months ended June 30, 2022. This increase is primarily due to the increase in interest rates.

 

Interest Expense

 

We incurred no interest expense for the quarter ended June 30, 2023, compared to approximately $377,000 for the quarter ended June 30, 2022. The $377,000 interest expense incurred during the six months of 2022 was primarily related to the conversions of both the Contingent Convertible Debentures and the remaining Convertible Notes (each as defined in Note 4) that resulted in all capitalized costs associated with the issuance of these notes being fully expensed upon conversion. The interest expense incurred during the six months ended June 30, 2022 was non-cash. 

 

 

Liquidity and Capital Resources

 

As of June 30, 2023 and December 31 2022, we had cash and cash-equivalents of approximately $5.1 million and $8.0 million, respectively, and working capital of approximately $9.7 million and $11.6 million, respectively. Net cash used in operations during the six months ended June 30, 2023 and 2022 totaled approximately $2.5 million and $4.3 million, respectively. Net cash used in operations decreased primarily due to the decrease in start-up expenses related to the launch of the cannabis-containing beverages and related products for the six months ended June 30, 2023.

 

We did not receive any cash from the exercise of stock options as of June 30, 2023 or 2022. From time to time, we may receive additional cash through the exercise of stock options or stock warrants. However, we cannot predict the timing or amount of cash proceeds we may receive from the exercise, if at all, of any of the outstanding stock options or warrants.

 

We intend to continually monitor and adjust our operating plan as necessary to respond to developments in our business, our markets and the broader economy.

 

As of the date of this Report, as a result of our cash on hand, we believe that our current cash and cash equivalents will be sufficient to meet the Company’s funding requirements for one year after these condensed consolidated financial statements are issued.

 

Critical Accounting Policies

 

See the information concerning our critical accounting policies included under “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operation – Critical Accounting Policies” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 29, 2023. There have been no material changes in our critical accounting policies during the three months ended June 30, 2023.

 

 

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

Not applicable.

 

ITEM 4.

CONTROLS AND PROCEDURES.

 

(a)

Evaluation of disclosure controls and procedures

 

We maintain disclosure controls and procedures (as such terms are defined under Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to ensure that the information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Management, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rule 13a-15(b) as of the end of the period covered by this report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that these disclosure controls and procedures were effective as of June 30, 2023.

 

(b)

Changes in internal controls over financial reporting

 

In response to the material weakness described in our most recently filed Annual Report on Form 10-K for the year ended December 31, 2022 filed with the Securities and Exchange Commission (“SEC”) on March 29, 2023, with the oversight of the Audit Committee of our Board of Directors, management has evaluated our policies and procedures related to the accounting for short term financings and has implemented adequate internal controls to ensure that (i) the liability associated with short-term financings are identified and recorded properly, and (ii) the associated asset with said financings are identified and recorded.

 

The remediation efforts were intended both to address the identified material weakness and to enhance our overall financial control environment. Management is committed to continuous improvement of the Company’s internal control over financial reporting and will continue to diligently review the Company’s internal control over financial reporting. 

 

Other than those described above, there were no other changes in our internal controls over financial reporting during the three months ended June 30, 2023 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

 

 

 

 

PART II – OTHER INFORMATION

 

ITEM 1.

LEGAL PROCEEDINGS

 

We are or may be involved from time to time in various claims and legal actions arising in the ordinary course of business, including proceedings involving employee claims, contract disputes, product liability and other general liability claims, as well as trademark, copyright, and related claims and legal actions. In the opinion of our management, the ultimate disposition of these matters will not have a material adverse effect on our consolidated financial position, results of operations or liquidity.

 

ITEM 1A

RISK FACTORS

 

There have been no material changes in the risk factors set forth in Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022.

 

ITEM 6.

EXHIBITS

 

3.1	Articles of Incorporation of Jones Soda Co. (Previously filed as, and incorporated herein by reference to, Exhibit 3.1 to our annual report on Form 10-KSB for the fiscal year ended December 31, 2000, filed on March 30, 2001; File No. 333-75913).
3.2	Amended and Restated Bylaws of Jones Soda Co. (Previously filed with, and incorporated herein by reference to, Exhibit 3.1 to our quarterly report on Form 10-Q, filed on November 8, 2013; File No. 000-28820).
3.3	Articles of Amendment to Articles of Incorporation of Jones Soda Co. dated May 16, 2022. (Previously filed with, and incorporated herein by reference to, Exhibit 3.3 to our registration statement on Form S-1, filed on June 14, 2022; File No. 333-265598).
31.1	Certification of Chief Executive Officer, pursuant to Rules 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
31.2	Certification of Chief Financial Officer, pursuant to Rules 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
32.1	Certification of Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).
32.2	Certification of Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).
101.INS*	Inline XBRL Instance 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 (formatted as Inline XBRL and contained in Exhibit 101)

 

* Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability.

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

 

	JONES SODA CO. (Registrant)
August 11, 2023
	By:	/s/ Joe Culp
		Joe Culp
		Interim Chief Financial Officer and Principal Financial Officer

 

 

EXHIBIT 31.1

CERTIFICATION OF PRESIDENT AND CHIEF EXECUTIVE OFFICER

PURSUANT TO RULES 13(a)-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934

 

I, David Knight, certify that:

 

1.	I have reviewed this report on Form 10-Q of Jones Soda Co.;

 

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;

 

4.

The registrant’s other certifying officer 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:

 

a)

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;

 

b)

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;

 

c)

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

 

d)

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 and I have disclosed, based on my 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):

 

a)

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

 

b)

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.

 

Date: August 11, 2023	/s/ David Knight
	David Knight
	President and Chief Executive Officer
	(Principal Executive Officer)

 

 

EXHIBIT 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO RULES 13(a)-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934

 

I, Joe Culp, certify that:

 

1.	I have reviewed this report on Form 10-Q of Jones Soda Co.;

 

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;

 

4.

The registrant’s other certifying officer 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:

 

a)

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;

 

b)

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;

 

c)

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

 

d)

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 and I have disclosed, based on my 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):

 

a)

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

 

b)

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.

 

 

Date: August 11, 2023

	/s/ Joe Culp
	Joe Culp
	Interim Chief Financial Officer and Director of Finance (Principal Financial Officer)

 

 

EXHIBIT 32.1

CERTIFICATION OF PRESIDENT AND CHIEF 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 Jones Soda Co. (the “Company”) on Form 10-Q for the fiscal quarter ended June 30, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Form 10-Q”), I, David Knight,  President and Chief Executive Officer of the Company, hereby certify that, to my knowledge, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

 

(1)	The Form 10-Q fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

 

(2)	The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

Date: August 11, 2023	/s/ David Knight
	David Knight
	President and Chief Executive Officer
	(Principal Executive Officer)

 

 

EXHIBIT 32.2

CERTIFICATION OF PRINCIPAL FINANCIAL 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 Jones Soda Co. (the “Company”) on Form 10-Q for the fiscal quarter ended June 30, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Form 10-Q”), I, Joe Culp, Principal Financial Officer of the Company, hereby certify that, to my knowledge, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002:

 

(1)	The Form 10-Q fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

 

(2)	The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

Date: August 11, 2023	/s/ Joe Culp
	Joe Culp
	Interim Chief Financial Officer and Director of Finance (Principal Financial Officer)

 

 

 

v3.23.2

Document And Entity Information - shares	6 Months Ended
	Jun. 30, 2023	Aug. 05, 2023
Document Information [Line Items]
Entity Central Index Key	0001083522
Entity Registrant Name	JONES SODA CO
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2023
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2023
Document Transition Report	false
Entity File Number	000-28820
Entity Incorporation, State or Country Code	WA
Entity Tax Identification Number	52-2336602
Entity Address, Address Line One	4786 1st Avenue South, Suite 103
Entity Address, City or Town	Seattle
Entity Address, State or Province	WA
Entity Address, Postal Zip Code	98134
City Area Code	206
Local Phone Number	624-3357
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		101,058,135

v3.23.2

Condensed Consolidated Balance Sheets (Current Period Unaudited) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 5,076	$ 7,971
Accounts receivable, net of allowance of $145 and $110, respectively	3,532	3,170
Inventory	2,538	2,621
Prefunded insurance premiums from financing	204	612
Prepaid expenses and other current assets	1,186	601
Total current assets	12,536	14,975
Fixed assets, net of accumulated depreciation of $333 and $309, respectively	121	127
Total assets	12,657	15,102
Current liabilities:
Accounts payable	1,039	1,070
Accrued expenses	1,556	1,643
Insurance premium financing	204	612
Taxes payable	2	10
Total current liabilities	2,801	3,335
Total liabilities	2,801	3,335
Shareholders’ equity:
Authorized — 800,000,000 issued and outstanding shares — 101,058,135 shares and 100,263,135 shares, respectively	90,110	89,680
Accumulated other comprehensive income	333	287
Accumulated deficit	(80,587)	(78,200)
Total shareholders’ equity	9,856	11,767
Total liabilities and shareholders’ equity	$ 12,657	$ 15,102

v3.23.2

Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) $ / shares in Thousands	Jun. 30, 2023	Dec. 31, 2022
Accounts receivable, allowance	$ 145,000	$ 110,000
Fixed assets, accumulated depreciation	$ 333,000	$ 309,000
Common stock, no par value (in dollars per share)	$ 0	$ 0
Common stock, authorized (in shares)	800,000,000	800,000,000
Common stock, issued (in shares)	101,058,135	100,263,135
Common stock, outstanding (in shares)	101,058,135	100,263,135

v3.23.2

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Revenue	$ 4,806	$ 6,015	$ 8,676	$ 10,538
Cost of goods sold	3,247	4,328	5,982	7,614
Gross profit	1,559	1,687	2,694	2,924
Operating expenses:
Selling and marketing	1,080	1,076	2,112	2,219
General and administrative	1,508	1,882	2,964	3,404
Total operating expenses	2,588	2,958	5,076	5,623
Loss from operations	(1,029)	(1,271)	(2,382)	(2,699)
Interest income	18	2	18	4
Interest expense	0	(146)	0	(377)
Other income (expense), net	4	(11)	(1)	(11)
Loss before income taxes	1,007	1,426	2,365	3,083
Income tax expense, net	(17)	(9)	(22)	(16)
Net loss	$ (1,024)	$ (1,435)	$ (2,387)	$ (3,099)
Net loss per share - basic and diluted (in dollars per share)	$ (0.01)	$ (0.02)	$ (0.02)	$ (0.04)
Weighted average common shares outstanding - basic and diluted (in shares)	100,880,113	95,303,482	100,667,058	87,539,631

v3.23.2

Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Net loss	$ (1,024)	$ (1,435)	$ (2,387)	$ (3,099)
Other comprehensive loss:
Foreign currency translation adjustment	43	(37)	46	(21)
Total comprehensive loss	$ (981)	$ (1,472)	$ (2,341)	$ (3,120)

v3.23.2

Condensed Consolidated Statements of Shareholders' Equity (Unaudited) - USD ($) $ in Thousands	Common Stock Including Additional Paid in Capital [Member]	AOCI Attributable to Parent [Member]	Retained Earnings [Member]	Total
Balance (in shares) at Dec. 31, 2021	67,840,941
Balance at Dec. 31, 2021	$ 76,017	$ 396	$ (71,796)	$ 4,617
Balance at Mar. 31, 2022	$ 85,561	412	(73,460)	12,513
Balance (in shares) at Mar. 31, 2022	92,252,188
Balance (in shares) at Dec. 31, 2021	67,840,941
Balance at Dec. 31, 2021	$ 76,017	396	(71,796)	4,617
Stock-based compensation	$ 386	0	0	386
Common stock issuance on conversion of notes payable (in shares)	10,472,146
Common stock issuance on conversion of notes payable	$ 5,148	0	0	5,148
Net income (loss)	0	0	(3,099)	(3,099)
Other comprehensive income (loss)	$ 0	(21)	0	(21)
Stock-based compensation (in shares)	(80,000)
Stock-based compensation (in shares)	80,000
Common stock and warrants issued, net of closing costs of $848 (in shares)	20,000,048
Common stock and warrants issued, net of closing costs of $848	$ 7,152	0	0	7,152
Net loss	0	0	(3,099)	(3,099)
Balance at Jun. 30, 2022	$ 88,703	375	(74,895)	14,183
Balance (in shares) at Jun. 30, 2022	98,393,135
Balance (in shares) at Mar. 31, 2022	92,252,188
Balance at Mar. 31, 2022	$ 85,561	412	(73,460)	12,513
Stock-based compensation	$ 117	0	0	117
Common stock issuance on conversion of notes payable (in shares)	6,060,947
Common stock issuance on conversion of notes payable	$ 3,025	0	0	3,025
Net income (loss)	0	0	(1,435)	(1,435)
Other comprehensive income (loss)	0	(37)	0	(37)
Net loss	0	0	(1,435)	(1,435)
Balance at Jun. 30, 2022	$ 88,703	375	(74,895)	$ 14,183
Balance (in shares) at Jun. 30, 2022	98,393,135
Balance (in shares) at Dec. 31, 2022	100,263,135			100,263,135
Balance at Dec. 31, 2022	$ 89,680	287	(78,200)	$ 11,767
Stock-based compensation	540	0	0	540
Net income (loss)	0	0	(2,387)	(2,387)
Other comprehensive income (loss)	$ 0	46	0	$ 46
Stock-based compensation (in shares)	(1,275,000)
Shares withheld for taxes upon RSU vesting (in shares)	(480,000)			(480,000)
Shares withheld for taxes upon RSU vesting	$ (110)	0	0	$ (110)
Stock-based compensation (in shares)	1,275,000
Net loss	$ 0	0	(2,387)	(2,387)
Balance at Jun. 30, 2023	$ 90,110	333	(80,587)	$ 9,856
Balance (in shares) at Jun. 30, 2023	101,058,135			101,058,135
Balance (in shares) at Mar. 31, 2023	100,698,135
Balance at Mar. 31, 2023	$ 89,884	290	(79,563)	$ 10,611
Stock-based compensation	274	0	0	274
Net income (loss)	0	0	(1,024)	(1,024)
Other comprehensive income (loss)	$ 0	43	0	43
Stock-based compensation (in shares)	(600,000)
Shares withheld for taxes upon RSU vesting (in shares)	(240,000)
Shares withheld for taxes upon RSU vesting	$ (48)	0	0	(48)
Stock-based compensation (in shares)	600,000
Net loss	$ 0	0	(1,024)	(1,024)
Balance at Jun. 30, 2023	$ 90,110	$ 333	$ (80,587)	$ 9,856
Balance (in shares) at Jun. 30, 2023	101,058,135			101,058,135

v3.23.2

Condensed Consolidated Statements of Shareholders' Equity (Unaudited) (Parentheticals) $ in Thousands	6 Months Ended
	Jun. 30, 2022 USD ($)
Net of closing costs	$ 848

v3.23.2

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
OPERATING ACTIVITIES:
Net loss	$ (2,387,000)	$ (3,099,000)
Adjustments to reconcile net loss to net cash flows used in operating activities:
Depreciation and amortization	29,000	382,000
Stock-based compensation	540,000	386,000
Change in allowance for doubtful accounts	35,000	5,000
Changes in operating assets and liabilities:
Accounts receivable	(382,000)	(1,428,000)
Inventory	90,000	(916,000)
Prefunded insurance premiums from financing	408,000	614,000
Prepaid expenses and other current assets	(584,000)	(585,000)
Other assets	0	25,000
Accounts payable	(32,000)	383,000
Accrued expenses	(195,000)	(43,000)
Taxes payable	(8,000)	6,000
Other liabilities	0	1,000
Net cash used in operating activities	(2,486,000)	(4,269,000)
INVESTING ACTIVITIES:
Purchase of fixed assets	(25,000)	(11,000)
Net cash used in investing activities	(25,000)	(11,000)
FINANCING ACTIVITIES:
Repayments on insurance financing	(408,000)	(614,000)
Net cash provided (used in) by financing activities	(408,000)	8,892,000
Net change in cash and cash equivalents	(2,919,000)	4,612,000
Effect of exchange rate changes on cash	24,000	6,000
Cash and cash equivalents, beginning of period	7,971,000	4,667,000
Cash and cash equivalents, end of period	5,076,000	9,285,000
Supplemental disclosure:
Interest	0	47,000
Income taxes	21,000	10,000
Supplemental disclosure of non-cash transactions:
Conversion of notes payable	0	5,148,000
Convertible Subordinated Notes Payable [Member]
FINANCING ACTIVITIES:
Proceeds from issuance of convertible notes	0	2,354,000
Contingent Convertible Debentures [Member]
FINANCING ACTIVITIES:
Proceeds from issuance of convertible notes	$ 0	$ 7,152,000

v3.23.2

Note 1 - Nature of Operations and Summary of Significant Accounting Policies	6 Months Ended
	Jun. 30, 2023
Notes to Financial Statements
Significant Accounting Policies [Text Block]	1. Nature of Operations and Summary of Significant Accounting Policies   Jones Soda Co. develops, produces, markets and distributes premium beverages which it sells and distributes primarily in the United States and Canada through its network of independent distributors and directly to its national and regional retail accounts.    In addition, following the closing of the Plan of Arrangement (See note 4(d)), we have expanded our business to the production of cannabis-containing beverages and related products.   We are a Washington corporation and have six subsidiaries, Jones Soda Co. (USA) Inc., Jones Soda (Canada) Inc., Jones Soda Cannabis Inc., Mary Jones California, LLC, Mary Jones Michigan, LLC, and Pinestar Gold Inc. (Subsidiaries).   Basis of presentation, consolidation and use of estimates   The accompanying condensed consolidated balance sheet as of December 31, 2022, which has been derived from our audited consolidated financial statements, and unaudited interim condensed consolidated financial statements as of June 30, 2023, have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the Securities and Exchange Commission (“SEC”) rules and regulations applicable to interim financial reporting. The condensed consolidated financial statements include our accounts and the accounts of our subsidiaries. All intercompany transactions between us and our subsidiaries have been eliminated in consolidation.   In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all material adjustments, consisting only of those of a normal and recurring nature, considered necessary for a fair presentation of our financial position, results of operations and cash flows at the dates and for the periods presented.  Preparing financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. Significant items subject to such estimates and assumptions include, but are not limited to, inventory valuation, depreciable lives and valuation of capital assets, valuation allowances for receivables, trade promotion liabilities, stock-based compensation expense, valuation allowance for deferred income tax assets, contingencies, and forecasts supporting the going concern assumption and related disclosures. Actual results could differ from those estimates. The operating results for the interim periods presented are not necessarily indicative of the results expected for the full year. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022.   Liquidity   As of June 30, 2023 and December 31, 2022, we had cash and cash-equivalents of approximately $5.1 million and $8.0 million, respectively, and working capital of approximately $9.7 million and $11.6 million, respectively. Net cash used in operations during the six months ended June 30, 2023 and 2022 totaled approximately $2.5 million and $4.3 million, respectively. Net cash used in operations decreased primarily due to the decrease in start-up expenses related to the launch of the cannabis-containing beverages and related products for the six months ended  June 30, 2023.   We did not receive any cash from the exercise of stock options as of June 30, 2023 or 2022. From time to time, we may receive additional cash through the exercise of stock options or stock warrants. However, we cannot predict the timing or amount of cash proceeds we may receive from the exercise, if at all, of any of the outstanding stock options or warrants.   We intend to continually monitor and adjust our operating plan as necessary to respond to developments in our business, our markets and the broader economy.   As of the date of this Report and as a result of our cash on hand, we believe that our current cash and cash equivalents will be sufficient to meet the Company’s funding requirements for one year after these condensed consolidated financial statements are issued.   Seasonality and other fluctuations   Our sales are seasonal and we experience fluctuations in quarterly results as a result of many factors. We historically have generated a greater percentage of our revenues during the warm weather months of April through September. Sales may fluctuate materially on a quarter to quarter basis or an annual basis when we launch a new product or fill the “pipeline” of a new distribution partner or a large retail partner. Sales results may also fluctuate based on the number of stock keeping units (“SKU”) selected or removed by our distributors and retail partners through the normal course of serving consumers in the dynamic, trend-oriented beverage industry. As a result, management believes that period-to-period comparisons of results of operations are not necessarily meaningful and should not be relied upon as any indication of future performance or results expected for the fiscal year.   Revenue recognition   Our contracts have a single performance obligation which is satisfied at the point in time when the customer has title and the significant risks and rewards of ownership of the product. Title and the significant risk and rewards of ownership are deemed to transfer when products are loaded onto a truck for shipment or Free on Board (“FOB”) shipping point. We primarily receive fixed consideration for sales of product, subject to adjustment as described below. Shipping and handling amounts paid by customers are primarily for online orders, and are included in revenue, and totaled $45,000 and $54,000 for the three months ended June 30, 2023 and 2022, respectively, and $86,000 in each of the six month periods ended June 30, 2023 and 2022. Sales tax and other similar taxes are excluded from revenue.    See Note 1, on our most recently filed Form 10-K filed on March 29, 2023 for our revenue recognition policy.    Revenue is recorded net of provisions for discounts, slotting fees payable by us to retailers to stock our products and promotion allowances. Discounts, slotting fees and promotional allowances vary the consideration we are entitled to in exchange for the sale of products to distributors. We estimate these discounts, slotting fees and promotional allowances in the same period that the revenue is recognized for product sales to customers. These estimates are based on contract terms and our historical experience with similar programs and require management judgement with respect to estimating customer participation and performance levels. Differences between estimated expense and actual costs are normally insignificant and are recognized in earnings in the period such differences are determined. The amount of revenue recognized represents the amount that will not be subject to a significant future reversal of revenue. The liability for promotional allowances is included in accrued expenses on the consolidated balance sheets. Amounts paid for slotting fees are recorded as prepaid expenses on the consolidated balance sheets and amortized over the corresponding term. For the quarters ended June 30, 2023 and 2022, our revenue was reduced by $394,000 and $451,000, respectively, and for the six months ended June 30, 2023 and 2022, by $699,000 and $759,000, respectively, in each case for slotting fees and promotion allowances.   All sales to distributors and customers are generally final. In limited instances we may accept returned product due to quality issues or distributor terminations, and in such situations we would have variable consideration. To date, returns have not been material. Our customers generally pay within 30 days from the receipt of a valid invoice. We offer prompt pay discounts of up to 2% to certain customers typically for payments made within 15 days. Prompt pay discounts are estimated in the period of sale based on experience with sales to eligible customers. Early pay discounts are recorded as a deduction to the accounts receivable balance presented on the condensed consolidated balance sheets.   The accounts receivable balance primarily includes balances from trades sales to distributors and retail customers. The allowance for doubtful accounts is the best estimate of the amount of probable credit losses in existing accounts receivable. We determine the allowance for doubtful accounts based primarily on historical write-off experience. Account balances that are deemed uncollectible are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. Allowances for doubtful accounts of $145,000 and $110,000 as of June 30, 2023 and December 31, 2022, respectively, were netted against accounts receivable. No impairment losses were recognized for the three or six months ended  June 30, 2023 and for the year ended December 31, 2022. Changes in accounts receivable are primarily due to the timing and magnitude of orders for products, the timing of when control of products is transferred to distributors and the timing of cash collections.   As of June 30, 2023, one of our independent customers made up 13% of our outstanding accounts receivable. As of December 31, 2022, two customers made up 22% of our outstanding accounts receivable.   Net loss per share   Basic net loss per share is computed using the weighted average number of common shares outstanding during the periods. Diluted earnings per share is computed by adjusting the weighted average number of common shares by the effective net exercise or conversion of all dilutive securities. Due to the net loss during the three and six months ended June 30, 2023 and 2022, outstanding stock options amounting to 12,154,480 and 3,206,832  shares were anti-dilutive, Additionally, outstanding warrants of  27,721,945 for each of the periods ended June 30, 2023 and 2022 were also anti-dilutive.    Recent accounting pronouncements   No new accounting pronouncements issued or effective during 2023 had, or are expected to have, a material impact on the Company’s consolidated financial statements.

v3.23.2

Note 2 - Inventory	6 Months Ended
	Jun. 30, 2023
Notes to Financial Statements
Inventory Disclosure [Text Block]	2. Inventory   Inventory consisted of the following (in thousands):       June 30, 2023     December 31, 2022   Finished goods   $ 1,362     $ 1,234   Raw materials     1,176       1,387       $ 2,538     $ 2,621     Finished goods primarily include product ready for shipment, as well as promotional merchandise held for sale. Raw materials primarily include ingredients, concentrate and packaging. For the three months ended June 30, 2023 and 2022, we recorded obsolete inventory expenses of $13,000 and $9,000, respectively. For the six months ended June 30, 2023 and 2022, we recorded obsolete inventory expenses of $19,000 and $22,000, respectively.

v3.23.2

Note 3 - Convertible Debentures	6 Months Ended
	Jun. 30, 2023
Notes to Financial Statements
Convertible Subordinated Notes Payable [Text Block]	3. Convertible Debentures   2018 Convertible Subordinated Note Payable   On March 23, 2018, and April 18, 2018, we issued and sold an aggregate principal amount of $2,920,000 of convertible subordinated promissory notes (the “2018 Convertible Notes”) to institutional investors, our management team, and other individual investors.   The 2018 Convertible Notes had a four-year term from the date of issuance and bared interest at 6% per annum. The 2018 Convertible Notes matured in two tranches on March 23, 2022, and April 18, 2022. The holders had the option to convert the 2018 Convertible Notes at any time prior to maturity into the number of shares of our common stock equal to the quotient obtained by dividing (i) the amount of the unpaid principal and interest on such 2018 Convertible Note by (ii) $0.32 (the “Conversion Price”). The Conversion Price was subject to anti-dilution adjustment on a broad-based, weighted average basis if we issued shares or equity-linked instruments at a conversion price below $0.32 per share. No payments of principal or interest were due until the maturity.   The 2018 Convertible Notes were subordinated in right of payment to the prior payment in full of all of our Senior Indebtedness, which was defined as amounts due in connection with our indebtedness for borrowed money to banks, commercial finance lenders, or other lending institutions regularly engaged in the business of lending money, with certain restrictions.   The fair value of our common stock on the March 23, 2018, closing date for the issuance of the first tranche of the 2018 Convertible Notes was $0.36 per share, therefore, the 2018 Convertible Notes issued on that date contained a beneficial conversion feature with an aggregate intrinsic value of $350,000. The fair value of our common stock on the April 18, 2018, the closing date for the issuance of the second tranche of the 2018 Convertible Notes, was $0.30 per share, which did not result in an additional beneficial conversion feature. The resulting debt discount for the 2018 Convertible Notes issued on March 23, 2018 was presented as a direct deduction from the carrying value of the 2018 Convertible Notes and was recorded with an increase to additional paid-in capital. The discount along with the related closing costs amounting to $137,000 were amortized through interest expense over the term of the 2018 Convertible Notes. On April 18, 2022, the last remaining outstanding 2018 Convertible notes matured and no 2018 Convertible Notes remain outstanding.   2021 Unsecured Convertible Debenture   On  July 14, 2021, we issued a $2,000,000 5.00% unsecured convertible debenture due July 14, 2023 (the “2021 Debenture”) to SOL Verano Blocker 1 LLC that was convertible into units of the Company (each a “Jones Unit”) at a conversion price of $0.50 per Jones Unit, with each Jones Unit consisting of one share of our common stock and one share purchase special warrant of Jones (each a “Jones Special Warrant”). Each Jones Special Warrant was exercisable into one share of our common stock at a price of $0.625 per share for a period of 24 months from the date of issuance, conditional upon us increasing our authorized capital to an amount to cover our shares of common stock issuable pursuant to all of the outstanding Jones Special Warrants as well as the other shares of our common stock issuable pursuant to our then-outstanding convertible/exercisable securities.   The closing of the statutory plan of arrangement under the Business Corporations Act (British Columbia) (the “Plan of Arrangement”) with Pinestar Gold Inc. (“Pinestar”) in February 2022 resulted in the automatic conversion of the 2021 Debenture into an aggregate of 4,025,035 shares of our common stock and 4,025,035 Jones Special Warrants at a conversion price of $0.50 per share of common stock and Jones Special Warrant. As a result, the carrying amount of the converted principal amount of such 2021 Unsecured Convertible Debenture, in an aggregate amount of $2,000,000, was credited to common stock.   2022 Unsecured Convertible Debenture   On February 9, 2022, we issued $3,000,000 in aggregate principal amount of 3.00% unsecured convertible debentures due February 9, 2023 (the “Contingent Convertible Debentures”), which were converted into Jones Units at a conversion price of $0.50 per Jones Unit on May 16, 2022. The Contingent Convertible Debentures were automatically convertible into Jones Units upon Jones Soda increasing its authorized capital to an amount to cover our shares of common stock issuable pursuant to all of the outstanding Contingent Convertible Debentures as well as all of the other then outstanding convertible/exercisable securities of Jones (a “Conversion Event”). The Contingent Convertible Debentures were only convertible into Jones Units upon the occurrence of a Conversion Event. The Contingent Convertible Debentures were set to mature on February 9, 2023 (the “Convertible Debenture Maturity Date”) and began accruing interest at a rate of 3.00% commencing on April 1, 2022. Under the terms of the Contingent Convertible Debentures, the Company covenanted to the holders of the Contingent Convertible Debentures that the Company will use their commercially reasonable efforts to cause the Conversion Event to occur as soon as practicable after the closing of the Plan of Arrangement. The related closing costs amounting to $108,000 were amortized through interest expense over the term of the Contingent Convertible Debentures. On May 16, 2022 all Contingent Convertible Debentures were converted into Jones Units, and the remaining unamortized capitalized closing costs were expensed.

v3.23.2

Note 4 - Shareholders' Equity	6 Months Ended
	Jun. 30, 2023
Notes to Financial Statements
Equity [Text Block]	4. Shareholders’ Equity   On May 16, 2022, our shareholders approved the adoption of the Jones Soda Co. 2022 Omnibus Equity Incentive Plan (the "2022 Plan"), which replaced the 2011 Plan (defined below) and provides for the granting incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock, restricted stock units and other stock-based awards to participants to acquire shares of Company common stock under the 2022 Plan. Under the terms of the 2022 Plan, the sum of (i) 10,000,000 shares of the Company’s common stock, plus (ii) the number of shares of common stock reserved, but unissued under the 2011 Plan, plus (iii) the number of shares of common stock underlying forfeited awards under the 2011 Plan are initially available for issuance as awards under the 2022 Plan.   1,936,074 shares of common stock reserved under the terms of our 2011 Incentive Plan (the “2011 Plan”) but unissued were transferred to the reserve for the 2022 Plan. Thus, the total number of shares of common stock authorized under the 2022 Plan was 11,936,074 shares.   Under the terms of the 2022 Plan, the Board may grant awards to employees, officers, directors, consultants, agents, advisors and independent contractors. Stock options are granted with an exercise price equal to the closing price of our stock on the date of grant, and generally have a ten-year term. As of June 30, 2023, there were 762,074 shares of unissued common stock authorized and available for future awards under the Plan.   (a) Stock options:   A summary of our stock option activity is as follows:       Outstanding Options       Number of Shares     Weighted Average Exercise Price (Per Share)   Balance at January 1, 2023     3,369,332     $ 0.41   Options granted     9,659,000       0.23   Options forfeited/expired     (873,852 )     0.27   Balance at June 30, 2023     12,154,480     $ 0.27   Exercisable, June 30, 2023     3,745,895     $ 0.33   Vested and expected to vest     10,142,892     $ 0.28         Outstanding Options       Number of Shares     Weighted Average Exercise Price (Per Share)   Balance at January 1, 2022     3,405,511     $ 0.38   Options granted     625,648       0.54   Options forfeited/expired     (824,327 )     0.41   Balance at June 30, 2022     3,206,832     $ 0.41   Exercisable, June 30, 2022     2,395,258     $ 0.32   Vested and expected to vest     2,975,046     $ 0.39     (b) Restricted stock awards:   Beginning on May 13, 2022, the Company’s board of directors (the “Board”) determined that it was in the best interests of the Company to periodically award restricted stock units as equity compensation for non-employee directors upon the recommendation of the Compensation and Governance Committee of the Board in lieu of stock options. Each restricted stock unit granted vests incrementally over the period in the specific award agreement, and certain restricted stock awards will immediately vest upon the occurrence of a "Change in Control" as defined in the 2022 Plan.   On December 30, 2022, the Company entered into rescission agreements (the “Rescission Agreements”) with the certain non-employee directors on the Board who were awarded restricted stock units during 2022 as well as the Company’s Chief Executive Officer and President who received restricted stock units during 2022 under the terms of his employment agreement with the Company. Under the terms of the Rescission Agreements, each of the Company and the applicable restricted stock unit grantee, agreed to rescind and cancel for no consideration all currently outstanding restricted stock units previously granted to each such grantee during 2022 as well as all shares of the Company’s common stock previously issued to any such grantee as a result of the vesting of any restricted stock units in August 2022.   In May of 2023, the Board determined that it was in the best interests of the Company to revise the Board of Director compensation structure to consist of annual grant of 300,000 stock options to each non-employee director each year for service on the Board and an additional 150,000 stock options as annual compensation for non-employee directors who serve as chair of a Board committee. All stock options granted to non-employee directors will vest incrementally in equal amounts over a three year period from the date of issuance.   A summary of our restricted stock activity for the six months ended June 30, 2023 is as follows:       Restricted Shares     Weighted-Average Grant Date Fair Value per share     Weighted-Average Contractual Life (years)   Non-vested restricted stock at January 1, 2023     -     $ -       -   Granted     1,800,000       0.26           Vested     (1,200,000 )     0.26           Cancelled/expired     -       -           Non-vested restricted stock at June 30, 2023     600,000     $ 0.26       9.6     We withheld a total of 480,000 shares as payment for withholding taxes due in connection with the vesting of restricted stock awards during the six months ended June 30, 2023, and the price paid per share of $0.26 reflects the market value per share of the shares withheld for tax purposes.    (c) Stock-based compensation expense:   Stock-based compensation expense is recognized using the straight-line attribution method over the employees’ requisite service period, or the non-employee's service period based on the term of the contract. We recognize compensation expense for only the portion of stock options or restricted stock expected to vest. Therefore, we apply estimated forfeiture rates that are derived from historical employee attrition. If the actual number of forfeitures differs from those estimated by management, additional adjustments to stock-based compensation expense may be required in future periods.   At June 30, 2023, we had unrecognized compensation expense related to stock options of $618,000 to be recognized over a weighted-average period of 2.5 years.   The following table summarizes the stock-based compensation expense (in thousands):       Three months ended June 30,     Six months ended June 30,       2023     2022     2023     2022                                     Stock options   $ 118     $ 23     $ 331     $ 292   Common stock award     -       -       17       -   Restricted stock     156       94       192       94       $ 274     $ 117     $ 540     $ 386                                     Income statement account:                                 Selling and marketing   $ 23     $ 18     $ 45     $ 109   General and administrative     251       99       495       277       $ 274     $ 117     $ 540     $ 386     The Company issued a common stock award of 75,000 shares under the 2022 Plan pursuant to a consulting agreement that resulted in $17,000 of stock compensation expense as seen in the above table.    We employ the following key weighted-average assumptions in determining the fair value of stock options, using the Black-Scholes option pricing model and the simplified method to estimate the expected term of “plain vanilla” options:       Six months ended June 30,       2023     2022   Expected dividend yield     —       —   Expected stock price volatility     87.5 %     78.3 % Risk-free interest rate     3.9 %     1.7 % Expected term (in years)     5.8       5.9   Weighted-average grant date fair-value   $ 0.17     $ 0.37     The aggregate intrinsic value of stock options outstanding at June 30, 2023 was approximately $74,000 and for options exercisable was also $40,000. The intrinsic value of outstanding and exercisable stock options is calculated as the quoted market price of the stock at the balance sheet date less the exercise price of the option. There were no options exercised during the three or six months ended June 30, 2023 and 2022.   (d) Closing of the Pinestar Gold Inc. - Plan of Arrangement:   On February 15, 2022, Jones issued an aggregate of 20,000,048 shares of our common stock in connection with the completion the Plan of Arrangement whereby the outstanding common shares of Pinestar (“Pinestar Shares”) were exchanged for newly issued shares of our common stock on a one-for-one basis. The Plan of Arrangement had previously been approved by both Pinestar’s shareholders as well as by the Supreme Court of British Columbia after such court held a hearing on the fairness of the terms and conditions of the Plan of Arrangement at which all Pinestar shareholders had the right to appear.   In connection with the Plan of Arrangement, Pinestar completed a subscription receipt offering for aggregate net proceeds of $7,152,000, at a price per subscription receipt equal to $0.50. As part of the closing of the Plan of Arrangement, each such subscription receipt automatically converted into one Pinestar Share and one new common share purchase warrant of Pinestar, which were then immediately exchanged for shares of our common stock and Jones Special Warrants, respectively, in accordance with a 1:1 exchange ratio.   The issuance of shares of our common stock to the holders of Pinestar Shares (including Pinestar Shares received upon the conversion of the subscription receipts issued in the Pinestar subscription receipt offering) in the Plan of Arrangement was exempt from the registration requirements under the United States Securities Act of 1933, as amended (the “Securities Act”) pursuant to Section 3(a)(10) of the Securities Act, which exempts from the registration requirements under the Securities Act any securities that are issued in exchange for one or more bona fide outstanding securities where the terms and conditions of such issuance and exchange are approved, after a hearing upon the fairness of such terms and conditions at which all persons to whom it is proposed to issue securities in such exchange shall have the right to appear, by any court expressly authorized by law to grant such approval.   The following table summarizes the Company's outstanding warrants as of June 30, 2023:     Number Outstanding     Remaining Contractual Life (Years)     Exercise Price Per Share     Number Exercisable   Jones Special Warrants (1)     26,047,137       0.71     $ 0.63 USD     26,047,137   Pinestar Warrants (2)     1,674,808       0.75       0.06  CAD     1,674,808         27,721,945                       27,721,945     (1) Upon conversion of the beforementioned 2021 Debenture, 4,025,035 Jones Special Warrants were issued. In connection with the beforementioned Plan of Arrangement, Pinestar completed an offering for subscription receipts for aggregate gross proceeds of $8,000,000. Pursuant to the Plan of Arrangement, each subscription receipt automatically converted into 16,000,000 Jones Special Warrants. Lastly, Upon conversion of the beforementioned Contingent Convertible Debentures, 6,022,102 Jones Special Warrants were issued.   (2) In connection with the beforementioned Plan of Arrangement, 1,674,808 warrants to purchase Pinestar Shares at a price of $0.06 CAD per share were assumed by the Company and became exercisable into shares of our common stock. An aggregate of 600,000 of such warrants were subsequently transferred to two members of our Board of Directors as consideration for services provided by such directors to the Company during 2022.

v3.23.2

Note 5 - Segment Information	6 Months Ended
	Jun. 30, 2023
Notes to Financial Statements
Segment Reporting Disclosure [Text Block]	5. Segment Information   We have one operating segment with operations primarily in the United States and Canada. Sales are assigned to geographic locations based on the location of customers. Sales by geographic location are as follows (in thousands):       Three months ended June 30,     Six months ended June 30,       2023     2022     2023     2022   Revenue:                                 United States   $ 3,814     $ 4,810     $ 7,043     $ 8,440   Canada     952       1,142       1,593       2,035   Other countries     40       63       40       63   Total revenue   $ 4,806     $ 6,015     $ 8,676     $ 10,538     During the three months ended June 30, 2023 and 2022, one of our customers (Lassonde) represented an aggregate of approximately 19% and 24% of our revenue, respectively.

v3.23.2

Note 6 - Insurance Premium Financing	6 Months Ended
	Jun. 30, 2023
Notes to Financial Statements
Insurance Disclosure [Text Block]	6. Insurance Premium Financing   Effective November 15, 2021, the Company entered into a one year financing agreement with IPFS Corporation to fund a portion of its insurance premiums in the amount of $903,000. Repayments were made quarterly on January 15, 2022, April 15, 2022, and July 15, 2022, and the entirety of the financing was paid off in full on July 15, 2022. The interest rate was 4.75% and there were no covenants associated with this agreement.   Effective November 15, 2022, the Company entered into a one year financing agreement with IPFS Corporation to fund a portion of its insurance premiums in the amount of $612,000. Repayments are made quarterly on January 15, 2023, April 15, 2023, and by July 15, 2023, the entirety of the financing was paid off in full. The interest rate is 6.99% and there are no covenants associated with this agreement. As of June 30, 2023, the principal balance was $203,000.

v3.23.2

Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2023
Accounting Policies [Abstract]
Basis of Accounting, Policy [Policy Text Block]	Basis of presentation, consolidation and use of estimates   The accompanying condensed consolidated balance sheet as of December 31, 2022, which has been derived from our audited consolidated financial statements, and unaudited interim condensed consolidated financial statements as of June 30, 2023, have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the Securities and Exchange Commission (“SEC”) rules and regulations applicable to interim financial reporting. The condensed consolidated financial statements include our accounts and the accounts of our subsidiaries. All intercompany transactions between us and our subsidiaries have been eliminated in consolidation.   In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all material adjustments, consisting only of those of a normal and recurring nature, considered necessary for a fair presentation of our financial position, results of operations and cash flows at the dates and for the periods presented.  Preparing financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses. Significant items subject to such estimates and assumptions include, but are not limited to, inventory valuation, depreciable lives and valuation of capital assets, valuation allowances for receivables, trade promotion liabilities, stock-based compensation expense, valuation allowance for deferred income tax assets, contingencies, and forecasts supporting the going concern assumption and related disclosures. Actual results could differ from those estimates. The operating results for the interim periods presented are not necessarily indicative of the results expected for the full year. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022.
Going Concern [Policy Text Block]	Liquidity   As of June 30, 2023 and December 31, 2022, we had cash and cash-equivalents of approximately $5.1 million and $8.0 million, respectively, and working capital of approximately $9.7 million and $11.6 million, respectively. Net cash used in operations during the six months ended June 30, 2023 and 2022 totaled approximately $2.5 million and $4.3 million, respectively. Net cash used in operations decreased primarily due to the decrease in start-up expenses related to the launch of the cannabis-containing beverages and related products for the six months ended  June 30, 2023.   We did not receive any cash from the exercise of stock options as of June 30, 2023 or 2022. From time to time, we may receive additional cash through the exercise of stock options or stock warrants. However, we cannot predict the timing or amount of cash proceeds we may receive from the exercise, if at all, of any of the outstanding stock options or warrants.   We intend to continually monitor and adjust our operating plan as necessary to respond to developments in our business, our markets and the broader economy.   As of the date of this Report and as a result of our cash on hand, we believe that our current cash and cash equivalents will be sufficient to meet the Company’s funding requirements for one year after these condensed consolidated financial statements are issued.
Seasonal Nature of Business [Policy Text Block]	Seasonality and other fluctuations   Our sales are seasonal and we experience fluctuations in quarterly results as a result of many factors. We historically have generated a greater percentage of our revenues during the warm weather months of April through September. Sales may fluctuate materially on a quarter to quarter basis or an annual basis when we launch a new product or fill the “pipeline” of a new distribution partner or a large retail partner. Sales results may also fluctuate based on the number of stock keeping units (“SKU”) selected or removed by our distributors and retail partners through the normal course of serving consumers in the dynamic, trend-oriented beverage industry. As a result, management believes that period-to-period comparisons of results of operations are not necessarily meaningful and should not be relied upon as any indication of future performance or results expected for the fiscal year.
Revenue from Contract with Customer [Policy Text Block]	Revenue recognition   Our contracts have a single performance obligation which is satisfied at the point in time when the customer has title and the significant risks and rewards of ownership of the product. Title and the significant risk and rewards of ownership are deemed to transfer when products are loaded onto a truck for shipment or Free on Board (“FOB”) shipping point. We primarily receive fixed consideration for sales of product, subject to adjustment as described below. Shipping and handling amounts paid by customers are primarily for online orders, and are included in revenue, and totaled $45,000 and $54,000 for the three months ended June 30, 2023 and 2022, respectively, and $86,000 in each of the six month periods ended June 30, 2023 and 2022. Sales tax and other similar taxes are excluded from revenue.    See Note 1, on our most recently filed Form 10-K filed on March 29, 2023 for our revenue recognition policy.    Revenue is recorded net of provisions for discounts, slotting fees payable by us to retailers to stock our products and promotion allowances. Discounts, slotting fees and promotional allowances vary the consideration we are entitled to in exchange for the sale of products to distributors. We estimate these discounts, slotting fees and promotional allowances in the same period that the revenue is recognized for product sales to customers. These estimates are based on contract terms and our historical experience with similar programs and require management judgement with respect to estimating customer participation and performance levels. Differences between estimated expense and actual costs are normally insignificant and are recognized in earnings in the period such differences are determined. The amount of revenue recognized represents the amount that will not be subject to a significant future reversal of revenue. The liability for promotional allowances is included in accrued expenses on the consolidated balance sheets. Amounts paid for slotting fees are recorded as prepaid expenses on the consolidated balance sheets and amortized over the corresponding term. For the quarters ended June 30, 2023 and 2022, our revenue was reduced by $394,000 and $451,000, respectively, and for the six months ended June 30, 2023 and 2022, by $699,000 and $759,000, respectively, in each case for slotting fees and promotion allowances.   All sales to distributors and customers are generally final. In limited instances we may accept returned product due to quality issues or distributor terminations, and in such situations we would have variable consideration. To date, returns have not been material. Our customers generally pay within 30 days from the receipt of a valid invoice. We offer prompt pay discounts of up to 2% to certain customers typically for payments made within 15 days. Prompt pay discounts are estimated in the period of sale based on experience with sales to eligible customers. Early pay discounts are recorded as a deduction to the accounts receivable balance presented on the condensed consolidated balance sheets.   The accounts receivable balance primarily includes balances from trades sales to distributors and retail customers. The allowance for doubtful accounts is the best estimate of the amount of probable credit losses in existing accounts receivable. We determine the allowance for doubtful accounts based primarily on historical write-off experience. Account balances that are deemed uncollectible are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. Allowances for doubtful accounts of $145,000 and $110,000 as of June 30, 2023 and December 31, 2022, respectively, were netted against accounts receivable. No impairment losses were recognized for the three or six months ended  June 30, 2023 and for the year ended December 31, 2022. Changes in accounts receivable are primarily due to the timing and magnitude of orders for products, the timing of when control of products is transferred to distributors and the timing of cash collections.   As of June 30, 2023, one of our independent customers made up 13% of our outstanding accounts receivable. As of December 31, 2022, two customers made up 22% of our outstanding accounts receivable.
Earnings Per Share, Policy [Policy Text Block]	Net loss per share   Basic net loss per share is computed using the weighted average number of common shares outstanding during the periods. Diluted earnings per share is computed by adjusting the weighted average number of common shares by the effective net exercise or conversion of all dilutive securities. Due to the net loss during the three and six months ended June 30, 2023 and 2022, outstanding stock options amounting to 12,154,480 and 3,206,832  shares were anti-dilutive, Additionally, outstanding warrants of  27,721,945 for each of the periods ended June 30, 2023 and 2022 were also anti-dilutive.
New Accounting Pronouncements, Policy [Policy Text Block]	Recent accounting pronouncements   No new accounting pronouncements issued or effective during 2023 had, or are expected to have, a material impact on the Company’s consolidated financial statements.

v3.23.2

Note 2 - Inventory (Tables)	6 Months Ended
	Jun. 30, 2023
Notes Tables
Schedule of Inventory, Current [Table Text Block]	June 30, 2023     December 31, 2022   Finished goods   $ 1,362     $ 1,234   Raw materials     1,176       1,387       $ 2,538     $ 2,621

v3.23.2

Note 4 - Shareholders' Equity (Tables)	6 Months Ended
	Jun. 30, 2023
Notes Tables
Share-Based Payment Arrangement, Option, Activity [Table Text Block]	Outstanding Options       Number of Shares     Weighted Average Exercise Price (Per Share)   Balance at January 1, 2023     3,369,332     $ 0.41   Options granted     9,659,000       0.23   Options forfeited/expired     (873,852 )     0.27   Balance at June 30, 2023     12,154,480     $ 0.27   Exercisable, June 30, 2023     3,745,895     $ 0.33   Vested and expected to vest     10,142,892     $ 0.28       Outstanding Options       Number of Shares     Weighted Average Exercise Price (Per Share)   Balance at January 1, 2022     3,405,511     $ 0.38   Options granted     625,648       0.54   Options forfeited/expired     (824,327 )     0.41   Balance at June 30, 2022     3,206,832     $ 0.41   Exercisable, June 30, 2022     2,395,258     $ 0.32   Vested and expected to vest     2,975,046     $ 0.39
Nonvested Restricted Stock Shares Activity [Table Text Block]	Restricted Shares     Weighted-Average Grant Date Fair Value per share     Weighted-Average Contractual Life (years)   Non-vested restricted stock at January 1, 2023     -     $ -       -   Granted     1,800,000       0.26           Vested     (1,200,000 )     0.26           Cancelled/expired     -       -           Non-vested restricted stock at June 30, 2023     600,000     $ 0.26       9.6
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Table Text Block]	Three months ended June 30,     Six months ended June 30,       2023     2022     2023     2022                                     Stock options   $ 118     $ 23     $ 331     $ 292   Common stock award     -       -       17       -   Restricted stock     156       94       192       94       $ 274     $ 117     $ 540     $ 386                                     Income statement account:                                 Selling and marketing   $ 23     $ 18     $ 45     $ 109   General and administrative     251       99       495       277       $ 274     $ 117     $ 540     $ 386
Schedule of Share-Based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]	Six months ended June 30,       2023     2022   Expected dividend yield     —       —   Expected stock price volatility     87.5 %     78.3 % Risk-free interest rate     3.9 %     1.7 % Expected term (in years)     5.8       5.9   Weighted-average grant date fair-value   $ 0.17     $ 0.37
Schedule of Stockholders' Equity Note, Warrants or Rights [Table Text Block]	Number Outstanding     Remaining Contractual Life (Years)     Exercise Price Per Share     Number Exercisable   Jones Special Warrants (1)     26,047,137       0.71     $ 0.63 USD     26,047,137   Pinestar Warrants (2)     1,674,808       0.75       0.06  CAD     1,674,808         27,721,945                       27,721,945

v3.23.2

Note 5 - Segment Information (Tables)	6 Months Ended
	Jun. 30, 2023
Notes Tables
Revenue from External Customers by Geographic Areas [Table Text Block]	Three months ended June 30,     Six months ended June 30,       2023     2022     2023     2022   Revenue:                                 United States   $ 3,814     $ 4,810     $ 7,043     $ 8,440   Canada     952       1,142       1,593       2,035   Other countries     40       63       40       63   Total revenue   $ 4,806     $ 6,015     $ 8,676     $ 10,538

v3.23.2

Note 1 - Nature of Operations and Summary of Significant Accounting Policies (Details Textual)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2023 USD ($) shares	Jun. 30, 2022 USD ($) shares	Jun. 30, 2023 USD ($) shares	Jun. 30, 2022 USD ($) shares	Dec. 31, 2022 USD ($)
Cash and Cash Equivalents, at Carrying Value	$ 5,076,000		$ 5,076,000		$ 7,971,000
Working Capital (Deficit)	9,700,000		9,700,000		$ 11,600,000
Net Cash Provided by (Used in) Operating Activities			(2,486,000)	$ (4,269,000)
Revenues	4,806,000	$ 6,015,000	8,676,000	10,538,000
Slotting Fees and Promotional Allowances	394,000	$ 451,000	699,000	$ 759,000
Maximum Discount for Customers, Payment Made Within 15 Days					2.00%
Accounts Receivable, Allowance for Credit Loss, Current	$ 145,000		$ 145,000		$ 110,000
Share-Based Payment Arrangement [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount (in shares) | shares	12,154,480	3,206,832	12,154,480	3,206,832
Warrant [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount (in shares) | shares	27,721,945	27,721,945	27,721,945	27,721,945
Customer Concentration Risk [Member] | Accounts Receivable [Member]
Number of Major Customers			1		2
Customer Concentration Risk [Member] | Accounts Receivable [Member] | One Customer [Member]
Concentration Risk, Percentage			13.00%
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Two Customers [Member]
Concentration Risk, Percentage					22.00%
Shipping and Handling [Member]
Revenues	$ 45,000	$ 54,000	$ 86,000	$ 86,000

v3.23.2

Note 2 - Inventory (Details Textual) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Inventory Write-down	$ 13,000	$ 9,000	$ 19,000	$ 22,000

v3.23.2

Note 2 - Inventory - Inventory (Details) - USD ($) $ in Thousands	Jun. 30, 2023	Dec. 31, 2022
Finished goods	$ 1,362	$ 1,234
Raw materials	1,176	1,387
Inventory, Net	$ 2,538	$ 2,621

v3.23.2

Note 3 - Convertible Debentures (Details Textual) - USD ($)					3 Months Ended		6 Months Ended
	Feb. 09, 2022	Jul. 14, 2021	Apr. 18, 2018	Mar. 23, 2018	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022
Share Price (in dollars per share)			$ 0.30	$ 0.36			$ 0.26
Stock Issued During Period, Value, Conversion of Convertible Securities					$ 3,025,000			$ 5,148,000
Plan of Arrangement Conversion [Member]
Debt Instrument, Convertible, Conversion Price (in dollars per share)	$ 0.50
Debt Conversion, Converted Instrument, Shares Issued (in shares)	4,025,035
Stock Issued During Period, Value, Conversion of Convertible Securities						$ 2,000,000
Jones Special Warrant [Member]
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right (in shares)		1
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share)		$ 0.625					$ 0.63
Warrants and Rights Outstanding, Term (Month)		24 months
Plan of Arrangement Warrant Conversion [Member]
Class of Warrant or Right, Exercised (in shares)	4,025,035
Convertible Notes [Member]
Convertible Subordinated Debt, Total				$ 2,920,000
Debt Instrument, Term (Year)			4 years
Debt Instrument, Interest Rate, Stated Percentage			6.00%
Debt Instrument, Convertible, Conversion Price (in dollars per share)			$ 0.32
Debt Instrument, Convertible, Beneficial Conversion Feature				$ 350,000
Debt Issuance Costs, Gross			$ 137,000
Unsecured Convertible Debenture to SOL Verano Blocker 1 LLC [Member]
Debt Instrument, Interest Rate, Stated Percentage		5.00%
Debt Instrument, Convertible, Conversion Price (in dollars per share)		$ 0.50
Proceeds from Convertible Debt		$ 2,000,000
Convertible Debt Common Shares Issuable per Unit (in shares)		1
Convertible Debt Warrants Issuable per Unit (in shares)		1
Contingent Convertible Debentures [Member]
Debt Instrument, Interest Rate, Stated Percentage	3.00%
Debt Issuance Costs, Gross	$ 108,000
Proceeds from Convertible Debt	$ 3,000,000						$ 0	$ 7,152,000
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share)	$ 0.50

v3.23.2

Note 4 - Shareholders' Equity (Details Textual)					1 Months Ended	3 Months Ended			6 Months Ended			12 Months Ended
		May 16, 2022 shares	Feb. 15, 2022 USD ($) $ / shares shares	Jul. 14, 2021 $ / shares shares	May 31, 2023 shares	Jun. 30, 2023 USD ($) $ / shares shares		Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($) $ / shares shares		Jun. 30, 2022 USD ($)	Dec. 31, 2022 USD ($) shares	Jun. 30, 2023 $ / shares	Dec. 31, 2022 $ / shares shares	Apr. 18, 2018 $ / shares	Mar. 23, 2018 $ / shares
Share-Based Payment Arrangement, Shares Withheld for Tax Withholding Obligation (in shares)									480,000
Share Price (in dollars per share) | $ / shares						$ 0.26			$ 0.26						$ 0.30	$ 0.36
Share-Based Payment Arrangement, Expense | $						$ 274,000		$ 117,000	$ 540,000		$ 386,000
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Intrinsic Value | $						74,000			74,000
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Exercisable, Intrinsic Value | $						$ 40,000			$ 40,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Period Increase (Decrease), Total (in shares)												0
Class of Warrant or Right, Outstanding (in shares)						27,721,945			27,721,945
Jones Special Warrant [Member]
Proceeds from a Subscription Receipt, Net | $												$ 8,000,000
Subscription Receipt, Conversion into Warrants (in shares)												16,000,000
Class of Warrant or Right, Outstanding (in shares)	[1]					26,047,137			26,047,137
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share) | $ / shares				$ 0.625		$ 0.63			$ 0.63
Pinestar Warrants [Member]
Class of Warrant or Right, Outstanding (in shares)						1,674,808	[2]		1,674,808	[2]				1,674,808
Class of Warrant or Right, Exercise Price of Warrants or Rights (in dollars per share) | $ / shares													$ 0.06	$ 0.06
Conversion of 2021 Unsecured Convertible Debenture into Jones Special Warrants [Member]
Debt Conversion, Converted Instrument, Warrants or Options Issued (in shares)				4,025,035
Conversion of 2022 Unsecured Convertible Debenture into Jones Special Warrants [Member]
Debt Conversion, Converted Instrument, Warrants or Options Issued (in shares)												6,022,102
Pinestar Subscription Receipt Offering [Member]
Stock Issued During Period, Shares, New Issues (in shares)			20,000,048
Proceeds from Issuance or Sale of Equity, Total | $			$ 7,152,000
Shares Issued, Price Per Share (in dollars per share) | $ / shares			$ 0.50
Director [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period (Year)					3 years
Director [Member] | Share-Based Payment Arrangement, Nonemployee [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Net of Forfeitures (in shares)					300,000
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Additional Granted Annual Compensation (in shares)					150,000
Two Board of Director's Members [Member] | Pinestar Warrants [Member]
Class of Warrant or Right, Warrants Issued During Period (in shares)												600,000
Share-Based Payment Arrangement, Option [Member]
Share-Based Payment Arrangement, Expense | $						$ 118,000		23,000	$ 331,000		292,000
Stock Options and Non-vested Stock [Member]
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount | $						618,000			$ 618,000
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition (Year)									2 years 6 months
Common Stock Award [Member]
Share-Based Payment Arrangement, Expense | $						$ 0		$ 0	$ 17,000		$ 0
The 2022 Incentive Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Authorized (in shares)		10,000,000
The 2022 Incentive Plan [Member] | Common Stock Award [Member]
Shares Issued, Shares, Share-Based Payment Arrangement, before Forfeiture (in shares)									75,000
Share-Based Payment Arrangement, Expense | $									$ 17,000
The 2011 Incentive Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Authorized (in shares)		11,936,074
Common Stock, Capital Shares Reserved for Future Issuance (in shares)		1,936,074
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Available for Grant (in shares)						762,074			762,074
The 2011 Incentive Plan [Member] | Share-Based Payment Arrangement, Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period (Year)		10 years
[1] Upon conversion of the beforementioned 2021 Unsecured Convertible Debenture, 4,025,035 Jones Special Warrants were issued. In connection with the beforementioned Plan of Arrangement, Pinestar completed an offering for Subscription Receipts for aggregate gross proceeds of $8,000,000. Pursuant to the Plan of Arrangement, each Subscription Receipt automatically converted into 16,000,000 Jones Special Warrants. Lastly, Upon conversion of the beforementioned 2022 Unsecured Convertible Debenture, 6,022,102 Jones Special Warrants were issued. [2] In connection with the beforementioned Plan of Arrangement, Pinestar, Pinestar had outstanding 16,800,000 existing common share purchase warrants and as a result of the consolidation, and the number of Pinestar Shares issuable pursuant to the Pinestar warrants as adjusted in accordance with their terms to account for the consolidation (10.031 pre consolidation shares to 1 post consolidation), resulting in an aggregate of approximately 1,674,808 post-consolidated Pinestar warrants, subject to rounding, each exercisable for the purchase of one post-consolidation Pinestar Share at a price of $0.0602 CAD per share. 600,000 warrants were transferred to two Board of Director members for 2022 services, thus resulting in $76,000 in stock compensation expense incurred during the year ended December 31, 2022

v3.23.2

Note 4 - Shareholders' Equity - Summary of Stock Option Activity (Details) - $ / shares	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Balance, number of shares (in shares)	3,369,332	3,405,511
Balance, weighted average exercise price (in dollars per share)	$ 0.41	$ 0.38
Options granted, number of shares (in shares)	9,659,000	625,648
Options granted, weighted average exercise price (in dollars per share)	$ 0.23	$ 0.54
Options forfeited/expired, number of shares (in shares)	(873,852)	(824,327)
Options forfeited/expired, weighted average exercise price (in dollars per share)	$ 0.27	$ 0.41
Balance, number of shares (in shares)	12,154,480	3,206,832
Balance, weighted average exercise price (in dollars per share)	$ 0.27	$ 0.41
Exercisable, number of shares (in shares)	3,745,895	2,395,258
Exercisable, weighted average exercise price (in dollars per share)	$ 0.33	$ 0.32
Vested and expected to vest, number of shares (in shares)	10,142,892	2,975,046
Vested and expected to vest, weighted average exercise price (in dollars per share)	$ 0.28	$ 0.39

v3.23.2

Note 4 - Shareholders' Equity - Summary of Restricted Stock Activity (Details) - Restricted Stock [Member]	6 Months Ended
	Jun. 30, 2023 $ / shares shares
Non-vested restricted stock (in shares) | shares	0
Non-vested restricted stock, weighted-average grant date fair value (in dollars per share) | $ / shares	$ 0
Granted (in shares) | shares	1,800,000
Granted, weighted-average grant date fair value (in dollars per share) | $ / shares	$ 0.26
Vested (in shares) | shares	(1,200,000)
Vested, weighted-average grant date fair value (in dollars per share) | $ / shares	$ 0.26
Cancelled/expired (in shares) | shares	0
Cancelled/expired/rescinded, weighted-average grant date fair value (in dollars per share) | $ / shares	$ 0
Non-vested restricted stock (in shares) | shares	600,000
Non-vested restricted stock, weighted-average grant date fair value (in dollars per share) | $ / shares	$ 0.26
Non-vested restricted stock, weighted-average contractual life (Year)	9 years 7 months 6 days

v3.23.2

Note 4 - Shareholders' Equity - Stock-based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Stock-based compensation expense	$ 274	$ 117	$ 540	$ 386
Selling and Marketing Expense [Member]
Stock-based compensation expense	23	18	45	109
General and Administrative Expense [Member]
Stock-based compensation expense	251	99	495	277
Share-Based Payment Arrangement, Option [Member]
Stock-based compensation expense	118	23	331	292
Common Stock Award [Member]
Stock-based compensation expense	0	0	17	0
Restricted Stock [Member]
Stock-based compensation expense	$ 156	$ 94	$ 192	$ 94

v3.23.2

Note 4 - Shareholders' Equity - Weighted-average Assumptions (Details) - Share-Based Payment Arrangement, Option [Member] - $ / shares	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Expected dividend yield	0.00%	0.00%
Expected stock price volatility	87.50%	78.30%
Risk-free interest rate	3.90%	1.70%
Expected term (in years) (Year)	5 years 9 months 18 days	5 years 10 months 24 days
Weighted-average grant date fair-value (in dollars per share)	$ 0.17	$ 0.37

v3.23.2

Note 4 - Stockholders' Equity - Schedule of Warrants (Details)		6 Months Ended
		Jun. 30, 2023 $ / shares shares		Jun. 30, 2023 $ / shares shares		Mar. 31, 2023 shares	Dec. 31, 2022 $ / shares shares	Jul. 14, 2021 $ / shares
Warrants outstanding (in shares)		27,721,945		27,721,945
Warrants, number exercisable (in shares)						27,721,945
Jones Special Warrant [Member]
Warrants outstanding (in shares)	[1]	26,047,137		26,047,137
Warrants, remaining contractual life (Year)		8 months 15 days
Warrants, exercise price (in dollars per share) | $ / shares		$ 0.63						$ 0.625
Warrants, number exercisable (in shares)						26,047,137
Pinestar Warrants [Member]
Warrants outstanding (in shares)		1,674,808	[2]	1,674,808	[2]		1,674,808
Warrants, remaining contractual life (Year)		9 months
Warrants, exercise price (in dollars per share) | $ / shares				$ 0.06			$ 0.06
Warrants, number exercisable (in shares)						1,674,808
[1] Upon conversion of the beforementioned 2021 Unsecured Convertible Debenture, 4,025,035 Jones Special Warrants were issued. In connection with the beforementioned Plan of Arrangement, Pinestar completed an offering for Subscription Receipts for aggregate gross proceeds of $8,000,000. Pursuant to the Plan of Arrangement, each Subscription Receipt automatically converted into 16,000,000 Jones Special Warrants. Lastly, Upon conversion of the beforementioned 2022 Unsecured Convertible Debenture, 6,022,102 Jones Special Warrants were issued. [2] In connection with the beforementioned Plan of Arrangement, Pinestar, Pinestar had outstanding 16,800,000 existing common share purchase warrants and as a result of the consolidation, and the number of Pinestar Shares issuable pursuant to the Pinestar warrants as adjusted in accordance with their terms to account for the consolidation (10.031 pre consolidation shares to 1 post consolidation), resulting in an aggregate of approximately 1,674,808 post-consolidated Pinestar warrants, subject to rounding, each exercisable for the purchase of one post-consolidation Pinestar Share at a price of $0.0602 CAD per share. 600,000 warrants were transferred to two Board of Director members for 2022 services, thus resulting in $76,000 in stock compensation expense incurred during the year ended December 31, 2022

v3.23.2

Note 5 - Segment Information (Details Textual)	3 Months Ended
	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022
Number of Operating Segments		1
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member]
Number of Major Customers	1		1
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | One Customer [Member]
Concentration Risk, Percentage	19.00%		24.00%

v3.23.2

Note 5 - Segment Information - Geographic Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Revenue	$ 4,806	$ 6,015	$ 8,676	$ 10,538
UNITED STATES
Revenue	3,814	4,810	7,043	8,440
CANADA
Revenue	952	1,142	1,593	2,035
Other Countries [Member]
Revenue	$ 40	$ 63	$ 40	$ 63

v3.23.2

Note 6 - Insurance Premium Financing (Details Textual) - IPFS Corporation Insurance Agreement [Member] - USD ($)	Nov. 15, 2022	Jun. 30, 2023	Nov. 15, 2021
Debt Instrument, Face Amount	$ 612,000		$ 903,000
Short-Term Debt, Weighted Average Interest Rate, at Point in Time	6.99%		4.75%
Debt Instrument, Term (Year)	1 year
Long-Term Debt, Gross		$ 203,000

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