UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

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

	For the quarterly period ended September 30, 2024

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

	For the transition period from ______________ to _________________

Commission File No.: 001-38182

EASTSIDE DISTILLING, INC.

(Exact name of registrant as specified in its charter)

Nevada

20-3937596

(State or other jurisdiction

of incorporation or organization)

(I.R.S. Employer

Identification No.)

755 Main Street, Building 4, Suite 3

Monroe, CT 06468

(Address of principal executive offices)

Registrant’s telephone number: (484) 800-9154

Securities registered pursuant to Section 12(b) of the Act:

Common Stock, $0.0001 par value		EAST		The Nasdaq Stock Market LLC
(Title of Each Class)		(Trading Symbol)		(Name of Each Exchange on Which Registered)

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

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

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

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

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☐	Smaller reporting company ☒
Emerging growth company ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act. Yes ☐ No ☒

As of November 15, 2024, 4,991,065 shares of our common stock were outstanding.

Documents Incorporated by Reference: None.

EASTSIDE DISTILLING, INC.

FORM 10-Q

September 30, 2024

TABLE OF CONTENTS

		Page
PART I— FINANCIAL INFORMATION		3

Item 1.	Financial Statements	3
	Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023	3
	Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2024 and 2023	4
	Consolidated Statements of Stockholders’ Equity (Deficit) for the Three and Nine Months Ended September 30, 2024 and 2023	5
	Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2024 and 2023	6
	Notes to the Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	32
Item 4	Controls and Procedures	32

PART II— OTHER INFORMATION		32

Item 1	Legal Proceedings	32
Item 1A	Risk Factors	32
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	33
Item 3.	Defaults Upon Senior Securities	33
Item 4.	Mine Safety Disclosures	33
Item 5.	Other Information	33
Item 6.	Exhibits	33

SIGNATURES		34

PART I: FINANCIAL INFORMATION

ITEM 1 – FINANCIAL STATEMENTS

Eastside Distilling, Inc. and Subsidiaries

Consolidated Balance Sheets

(Dollars in thousands, except shares and per share amounts)

	September 30, 2024			December 31, 2023
	(unaudited)
Assets
Current assets:
Cash	$	310		$	306
Trade receivables, net		105			163
Inventories		1,793			2,686
Prepaid expenses and other current assets		176			113
Current assets held for sale		2,640			1,269
Total current assets		5,024			4,537
Property and equipment, net		112			169
Right-of-use assets		430			680
Intangible assets, net		4,178			4,178
Other assets, net		182			247
Non-current assets held for sale		6,298			7,669
Total Assets	$	16,224		$	17,480

Liabilities and Stockholders’ Equity (Deficit)
Current liabilities:
Accounts payable	$	1,388		$	1,062
Accrued liabilities		418			465
Current portion of secured credit facilities, related party		3,447			-
Current portion of secured credit facilities, net of debt issuance costs		728			-
Current portion of notes payable		8,155			486
Current portion of notes payable, related party		92			92
Current portion of lease liabilities		191			223
Other current liability, related party		85			-
Current liabilities held for sale		3,124			1,877
Total current liabilities		17,628			4,205
Lease liabilities, net of current portion		213			458
Secured credit facilities, related party		-			2,700
Secured credit facilities, net of debt issuance costs		-			342
Notes payable, net of current portion		-			7,556
Non-current liabilities held for sale		843			1,366
Total liabilities		18,684			16,627

Commitments and contingencies (Note 14)		-			-

Stockholders’ equity (deficit):
Common stock, $0.0001 par value; 6,000,000 shares authorized as of September 30, 2024 and December 31, 2023; and 3,140,625 shares and 1,705,987 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively		-			-
Preferred stock, $0.0001 par value; 100,000,000 shares authorized; 2,500,000 Series B shares issued and outstanding as of both September 30, 2024 and December 31, 2023		-			-
Preferred stock, $0.0001 par value; 240,000 shares authorized; 117,586 Series C shares and 200,000 Series C shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively		-			-
Preferred stock, value		-			-

Additional paid-in capital		84,499			83,559
Accumulated deficit		(86,959	)		(82,706	)
Total stockholders’ equity (deficit)		(2,460	)		853
Total Liabilities and Stockholders’ Equity (Deficit)	$	16,224		$	17,480

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

Eastside Distilling, Inc. and Subsidiaries

Consolidated Statements of Operations

For the Three and Nine Months Ended September 30, 2024 and 2023

(Dollars and shares in thousands, except per share amounts)

(Unaudited)

	2024		2023		2024		2023
	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023

Sales	$	783	$	849	$	2,106	$	3,080
Less customer programs and excise taxes		23		43		129		141
Net sales		760		806		1,977		2,939
Cost of sales		560		638		1,476		1,940
Gross profit		200		168		501		999
Operating expenses:
Sales and marketing expenses		218		303		699

SEC Form 10-Q filed by Eastside Distilling Inc.