Charlie : Change in Certifying Accountants - Form 8-K
April 19, 2024 at 04:35 pm EDT
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Item 4.01(a)
Changes in Registrant's Certifying Accountant.
On April 17, 2024, the Audit Committee (the "Committee") of the Board of Directors of Charlie's Holdings, Inc. (the "Company") accepted the resignation of Mazars USA LLP ("Mazars"), the Company's current independent registered public accounting firm. Mazars made the decision to cease its services to the Company effective with the filing of the Company's Form 10-Q for the quarter ended March 31, 2024 in connection with related client engagement continuance procedures resulting from the transaction Mazars is entering into with FORVIS, LLP effective June 1, 2024.
The audit report of Mazars on the Company's consolidated financial statements as of December 31, 2023 and for the year ended December 31, 2023 did not contain any adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope or accounting principles. However, Mazars's report on the financial statements included an emphasis paragraph regarding substantial doubt about the Company's ability to continue as a going concern and a critical audit matter regarding the reserve for excess and slow-moving inventory.
From their appointment on June 29, 2023 through April 17, 2024, there were no (i) disagreements within the meaning of Item 304(a)(1)(iv) of Regulation S-K between the Company and Mazars on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to Mazars's satisfaction, would have caused Mazars to make reference to the subject matter of the disagreements in connection with its reports on the Company's consolidated financial statements for such years or (ii) reportable events within the meaning of Item 304(a)(1)(v) of Regulation S-K and the related instructions thereto.
The Company provided Mazars with a copy of this Current Report on Form 8-K prior to its filing with the Securities and Exchange Commission and requested that Mazars furnish the Company with a letter addressed to the Securities and Exchange Commission stating whether or not Mazars agrees with the statements made herein and, if not, stating the respects in which it does not agree. A copy of Mazars's letter is filed as Exhibit 16.1 herewith.
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Charlie's Holdings, Inc. is engaged in formulating, marketing and distributing non-combustible nicotine-related products, alternative alkaloid vapor products, and hemp-derived vapor and edible products. Its wholly owned subsidiaries include Charlieâs Chalk Dust, LLC, which produces and sells nicotine-based and alternative alkaloid vapor products, and Don Polly, LLC, develops, markets and distributes products containing cannabinoids derived from hemp. Its alternative alkaloid products include SPREE BAR vapes with Metatine and are available with rechargeable, reusable batteries. Its other cannabinoids include PINWEEL Disposable, PINWEEL Carts and PINWEEL Edibles. The Companyâs products are produced through contract manufacturers for sale through select distributors, specialty retailers, and third-party online resellers throughout the United States, and in select international markets including the United Kingdom, Italy, Spain, New Zealand, Australia, and Canada.
CHARLIE'S HOLDINGS, INC. 
