Company: CHUC
Filing Date: 2025-11-19
Form Type: 10-Q
Source: 0001437749-25-035731
Chunk: 38

Company: Charlie's Holdings, Inc.
Filing Date: 2025-11-19
Form: 10-Q
Item: Part I, Item 1
Chunk 38
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 approximately $389,000 in cash from financing activities related to the issuance of notes payable of $2,546,000, notes payable to a related party of $100,000 and the repayment of $3,036,000 in notes payable, including $1,111,000 to related parties. For the nine months ended September 30, 2024, we generated approximately $1,478,000 in cash from financing activities related to the issuance of common shares of $1,030,000, notes payable of $742,000, notes payable to a related party of $500,000 and the repayment of $795,000 in notes payable, including $50,000 to a related party.

Substantial Doubt to Continue as a Going Concern

Our consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. For the nine months ended September 30, 2025, the Company’s revenue increased, the Company generated loss from operations of approximately $2,042,000, and a consolidated net income of approximately $4,368,000. Net cash used in operating activities was approximately $6,172,000. The Company had a stockholders’ equity of $3,239,000 at September 30, 2025. During the nine months ended September 30, 2025, the Company’s working capital was increased to $3,079,000 from a deficit of $1,855,000 as of December 31, 2024. Given these factors, remains a substantial doubt about the Company’s ability to continue as a going concern. During the nine months ended September 30, 2025, the Company entered into and closed an Asset Purchase Agreement (the “ Agreement”) and subsequent amendment with R. J. Reynolds Vapor Company (the “ Buyer”) pursuant to which the Buyer purchased 16 of the Company’s PACHA synthetic products and related assets (the “ Assets”) that are covered by a premarket tobacco application (“ PMTA”) first submitted by the Company in 2022. The combined purchase price for the Assets was $6.5 million paid at closings in April and May 2025, and an additional $1.0 million paid at closings in August 2025, plus a contingent one-time payment of up to $4.2 million based on product sold by the Buyer during the one year following the first day of commercialization