Company: CHUC
Filing Date: 2025-05-29
Form Type: 10-K
Source: 0001437749-25-018798
Chunk: 10

Company: Charlie's Holdings, Inc.
Filing Date: 2025-05-29
Form: 10-K
Item: Item 1A
Chunk 10
---
 authority were to otherwise assume regulatory control of such products, we could be required to cease selling such products (including recalling existing products), subject to an enforcement action or otherwise be required to comply with various regulations that could be expensive. More generally, FDA’s regulatory initiatives and enforcement authority regarding our products are unpredictable and continue to evolve and we cannot predict whether FDA’s priorities and/or potential jurisdiction over our products will require us to remove our products from the market and to cease selling them. As a result, any regulation over SBX could material adversely affect us.

Certain of our products contain nicotine or Metatine which are considered to be highly addictive substances.

Certain of our products contain nicotine or Metatine, chemicals found in cigarettes, e-cigarettes, certain other vapor products and other tobacco products, which are considered to be highly addictive. Though the FDA does not currently have regulatory jurisdiction over Metatine, the Family Smoking Prevention and Tobacco Control Act empowers the FDA to regulate the amount of nicotine found in vapor products. Any new FDA regulation over nicotine may require us to reformulate, recall, and/or discontinue certain of the products we may sell from time to time, which may have a material adverse effect on our ability to market our products and have a material adverse effect on our business, financial condition, results of operations, cash flows and or future prospects.

Recent bans on the sales of flavored e-cigarettes directly impacts the markets in which we may sell Charlie’ s products, and significant increases in state and local regulation of Charlie’ s products have been proposed or enacted and are likely to continue to be proposed or enacted in numerous jurisdictions.

On January 2, 2020 the FDA issued an enforcement policy effectively banning the sale of flavored cartridge-based e-cigarettes marketed primarily by large manufacturers in the United States without prior authorization from the FDA. There has been increasing activity on the state and local levels with respect to scrutiny of Charlie’s products, and many states, provinces, and some cities have passed laws restricting or banning the sale of e-cigarettes and certain other nicotine vaporizer products, including flavored e-liquids. State and local governmental bodies across the U. S. have indicated Charlie’s products may become subject to new laws and regulations at the state and local levels. Further, some states and cities have enacted regulations that require obtaining a tobacco retail license in order to sell electronic cigarettes and vaporizer products. If one or more states from which we generate or anticipate generating significant sales of Charlie’s products bring actions to prevent us from selling Charlie’s products unless we obtain certain licenses