UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(MARK ONE)

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

For the quarterly period ended June 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. 000-56253

CHARGING ROBOTICS INC.

(Exact name of registrant as specified in its charter)

Delaware		26-2274999
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

20 Raul Wallenberg Street

Tel Aviv, Israel, 6971916

(Address of principal executive offices, zip code)

(+972) 54 642-0352

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the issuer (1) has filed all reports required to be filed 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 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically 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” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (check one):

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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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

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

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
N/A		N/A		N/A

As of June 30, 2024, and August 13, 2024, there were 9,151,040 shares of common stock, par value $0.0001 per share, issued and outstanding.

CHARGING ROBOTICS INC.

(FORMERLY FUEL DOCTOR HOLDINGS, INC.)

TABLE OF CONTENTS

			Page
Part I. Financial Information			1

	Item 1.	Consolidated Financial Statements (Unaudited)	1

		Condensed Consolidated Balance Sheets as at June 30, 2024 (Unaudited) and December 31, 2023 (Audited)	1

		Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2024 and June 30, 2023 (Unaudited)	2

		Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three and Six Months Ended June 30, 2024 and June 30, 2023 (Unaudited)	3

		Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2024 and June 30, 2023 (Unaudited)	4

		Notes to the Condensed Consolidated Financial Statements (Unaudited)	5

	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14

	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	18

	Item 4.	Controls and Procedures	18

Part II. Other Information			19

	Item 1.	Legal Proceedings	19

	Item 1A.	Risk Factors	19

	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	19

	Item 3.	Defaults Upon Senior Securities	19

	Item 4.	Mine Safety Disclosures	19

	Item 5.	Other Information	19

	Item 6.	Exhibits	19

Signatures			20

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q of Charging Robotics Inc. (formerly Fuel Doctor Holdings, Inc.), a Delaware corporation (the “Company”), contains “forward-looking statements.” In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of such terms and other comparable terminology. These forward-looking statements include, without limitation, statements about our market opportunity, our strategies, competition, expected activities and expenditures as we pursue our business plan, and the adequacy of our available cash resources. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Actual results may differ materially from the predictions discussed in these forward-looking statements. The economic environment within which we operate could materially affect our actual results. Additional factors that could materially affect these forward-looking statements and/or predictions include, among other things: the Company’s need for and ability to obtain additional financing and the demand for the Company’s products, and other factors over which we have little or no control; and other factors discussed in the Company’s filings with the Securities and Exchange Commission (“SEC”).

We caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events, except as required by law.

PART I. FINANCIAL INFORMATION

ITEM 1: CONSOLIDATED FINANCIAL STATEMENTS.

CHARGING ROBOTICS INC.

(FORMERLY FUEL DOCTOR HOLDINGS, INC.)

CONDENSED CONSOLIDATED BALANCE SHEETS

U.S. dollars in thousands except share and per share data

	June 30, 2024			December 31, 2023
	(Unaudited)			(Audited)
ASSETS
Current assets:
Cash	$	38		$	8
Other accounts receivable		14			43
Total current assets		52			51

Non current assets:
Intangible asset		104			100
Investment in an affiliate (Note 4)		83			110
Loan to an affiliate (Note 4)		63			62
Total non current assets		250			272

TOTAL ASSETS	$	302		$	323

LIABILITIES & STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable	$	103		$	104
Other current liabilities		161			116
Receipt on account of shares		65			-
Short term loans		234			30
Related parties (Note 5)		146			98
Total current liabilities		709			348

Non-current liabilities:
Deferred revenues	$	31		$	49

Total liabilities	$	740		$	397

Stockholders’ deficit (Note 6)
Preferred shares of the Company, par value $0.0001 per share, 10,000,000 shares authorized, 0 shares issued and outstanding at December 31, 2023 and December 31, 2022		-			-
Common Stock, par value $0.0001, 2,990,000,000 shares authorized, 9,151,040 shares issued and outstanding at June 30, 2024 and December 31, 2023		1			1
Additional paid-in capital		1,817			1,817
Foreign currency transaction reserve		(30	)		(27	)
Reserve from share-based compensation transactions		122			101
Accumulated deficit		(2,348	)		(1,966	)

Total stockholders’ deficit		(438	)		(74	)

TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT	$	302		$	323

See accompanying Notes to Condensed Consolidated Financial Statements

CHARGING ROBOTICS INC.

(FORMERLY FUEL DOCTOR HOLDINGS, INC.)

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

U.S. dollars in thousands except share and per share data
(Unaudited)

	Three months ended						Six months ended
	June 30, 2024			June 30, 2023			June 30, 2024			June 30, 2023

Research and development costs	$	85		$	37		$	148		$	149
General and administrative costs		96			144			214			156
Operating loss		(181	)		(181	)		(362	)		(305	)
Financial expenses		1			-			3			-
Net loss		(180	)		(181	)		(359	)		(305	)
Share in losses of affiliate		(5	)		(10	)		(23	)		(11	)
Net loss for the period		(185	)		(191	)		(382	)		(316	)
Other comprehensive loss		(1	)		(7	)		(3	)		(7	)
Net loss and comprehensive loss for the period		(186	)		(198	)		(385	)		(323	)

Basic and diluted loss per common share		(0.02	)		(0.02	)		(0.04	)		(0.08	)
Weighted average common shares outstanding (*)		9,151,040			8,137,131			9,151,040			4,091,134

(*)

On April 23, 2024, the Company received notice from FINRA that the Reverse Stock Split has been announced on FINRA’s daily list and will take effect at market open on April 24, 2024 (the “Market Effective Date”). Accordingly, the FINRA corporate action to effect the Reverse Stock Split is now completed. Consequently, all share numbers, share prices, and exercise prices have been retroactively adjusted in these consolidated financial statements for all periods presented.

See accompanying Notes to Condensed Consolidated Financial Statements

CHARGING ROBOTICS INC.

(FORMERLY FUEL DOCTOR HOLDINGS, INC.)

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

U.S. dollars in thousands except share and per share data

For the six and months ended June 30, 2024

(Unaudited)

	Common Stock				Additional Paid in		Stock-based		Accumulated other comprehensive			Accumulated			Total Shareholders’
	Number		Amount		capital		compensation		loss			Deficit			Deficit

Balance at January 1, 2024		9,151,040	$	1	$	1,817	$	101	$	(27	)	$	(1,966	)	$	(74	)
Issuance of warrant								18								18
Share-based payment reserve		-		-		-		3		-			-			3
Net comprehensive loss for the period		-		-		-		-		(3	)		(382	)		(385	)
Balance at June 30, 2024		9,151,040	$	1	$	1,817	$	122	$	(30	)		(2,348	)	$	(438	)

	Common Stock				Additional Paid in			Stock-based		Accumulated other comprehensive			Accumulated			Total Shareholders’
	Number		Amount		capital			compensation		loss			Deficit			Equity

Balance at January 1, 2023		182	$	-	$	741		$	91	$	(12	)	$	(1,188	)	$	(368	)
Exercise of options		27		-		91			7		-			-			98
Issuance of shares in respect of converted loan		51		-		509			-		-			-			509
Effect of reverse merger		8,240,780		1		(25	)		-		-			-			(24	)
Issuance of shares in respect of private placement		910,000		-		501			-		-			-			501
Net comprehensive loss for the period		-		-		-			-		(7	)		(316	)		(323	)
Balance at June 30, 2023		9,151,040	$	1	$	1,817		$	98	$	(19	)	$	(1,504	)	$	393

(*)

See accompanying Notes to Condensed Consolidated Financial Statements

CHARGING ROBOTICS INC.

(FORMERLY FUEL DOCTOR HOLDINGS, INC.)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

U.S. dollars in thousands except share and per share data
(Unaudited)

	For the six months ended
	June 30,
	2024			2023
CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss	$	(382	)	$	(316	)
Adjustments to reconcile net loss to net cash used in operating activities:
Share-based payment expenses		3			7
Share in losses of affiliate		23			11
Interest income		3			(1	)
Changes in operating assets and liabilities:
Decrease (increase) in other accounts receivable		29			24
Increase (decrease) in related parties		48			(20	)
Increase (decrease) in accounts payable		(1	)		(58	)
Increase in other accounts payable and accrued expenses		45			11
Net cash used in operating activities		(232	)		(342	)

CASH FLOWS USED IN INVESTING ACTIVITIES:
Investment in intangible asset		(4	)		-
Net cash used in investing activities		(4	)		-

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of shares in respect of a private placement		-			501
Proceeds from short term loans received		201			-
Proceeds on account of shares		65			-
Proceeds from exercise of options		-			91
Net cash provided by financing activities		266			592

Net increase in cash		30			250
Effect of changes in foreign exchange rates		-			1
Effect of reverse merger		-			(24	)
Cash at beginning of period		8			27

Cash at end of period	$	38		$	254

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest	$	-		$	-
Franchise taxes	$	-		$	-

SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITIES:
Issuance of shares to in respect of converted loan	$	-		$	509
Issuance of warrants in respect of deferred revenue	$	18		$	-
Investment in intangible asset	$	-		$	11

See accompanying Notes to Condensed Consolidated Financial Statements

CHARGING ROBOTICS INC.

(FORMERLY FUEL DOCTOR HOLDINGS, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands except share and per share data

(UNAUDITED)

NOTE 1 – GENERAL

Charging Robotics Inc. (formerly Fuel Doctor Holdings, Inc.) (the “Company”) was incorporated in the State of Delaware on March 25, 2008, as Silver Hill Management Services, Inc. On August 24, 2011, the Company amended its Certificate of Incorporation and changed its name to Fuel Doctor Holdings, Inc, and on April 23, 2024, the Company changed its name to Charging Robotics Inc.

On March 28, 2023, the Company entered into a Securities Exchange Agreement (the “Acquisition Agreement”) with the stockholders of Charging Robotics Ltd. (“CR Israel”). Pursuant to the Acquisition Agreement, at the closing, which occurred on April 7, 2023 (the “Closing”), the Company acquired 100% of the issued and outstanding stock of CR Israel (the “Acquisition”), making CR Israel a wholly owned subsidiary of the Company.

CR Israel was formed in February 2021, as an Israeli corporation, with the main goal of developing an innovative wireless electric vehicles (EV) charging technology. At the heart of the technology is a wireless power transfer module that uses resonance coils to transfer electricity wirelessly. This module can be used for various products such as robotic and stationary platforms. The robotic platform includes a component which is small enough to fit under the vehicle, and which automatically positions itself for maximum-efficiency charging, and upon charging completion automatically returns to its docking station. CR Israel also developed a Wireless EV Charging System for automatic parking lots based on our wireless electricity transfer module.

On April 6, 2023, the Company issued a total of 910,000 newly issued shares of common stock of the Company, par value $0.0001 per share (the “Common Stock”) in respect of a private placement for total proceeds of $500.

On November 22, 2023, the Company announced that CR Israel received approval for funding from the Israel Innovation Authority (the “IIA”) for a pilot project to include installing and demonstrating its solution for wireless charging of electric vehicles (EVs) in automated parking systems (“APS”). The total approved budget for this project was approximately $445, of which the IIA would finance 50%. The Company is now engaged in the pilot project to implement the solution in an APS in Tel Aviv. In December 2023, CR Israel received $77 from the IIA, and on February 14, 2024, CR Israel received an additional $33 from the IIA.

On August 28, 2023, the Company filed an amended and restated certificate of incorporation (the “Amended and Restated Certificate of Incorporation”), to (i) change its name to Charging Robotics Inc. (the “Name Change”); and (ii) effect a one-for-one hundred fifty reverse stock split (the “Reverse Stock Split”) of its outstanding shares of Common Stock.

On August 28, 2023, the Company submitted an Issuer Company-Related Action Notification Form to the Financial Industry Regulatory Authority, Inc. (“FINRA”) regarding the Name Change and Reverse Stock Split.

CHARGING ROBOTICS INC.

(FORMERLY FUEL DOCTOR HOLDINGS, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands except share and per share data

(UNAUDITED)

NOTE 1 – GENERAL (CONT.)

Basis of presentation of the financial statements:

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X promulgated by the U.S Securities and Exchange Commission (the “SEC”). Certain information or footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, they do not include all the information and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments consisting of a normal recurring nature which are necessary for a fair presentation of the financial position, operating results, and cash flows for the periods presented.

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report for the year ended December 31, 2023, filed with the SEC on March12, 2024. The interim period results do not necessarily indicate the results that may be expected for any other interim period or for the full fiscal year.

NOTE 2 – UNAUDITED INTERIM CONDENSED FINANCIAL STATEMENTS

The financial statements were prepared in accordance with accounting principles generally accepted in the United States of America (US GAAP).

Use of estimates:

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of expenses during the reporting periods. Actual results could differ from those estimates. As applicable to these financial statements, the most significant estimates and assumptions relate to share-based compensation and the Company’s ability to continue as a going concern.

Financial statements in U.S. dollars:

The costs of the Company are denominated in United States dollars (“dollars”). Some of the costs in our Israeli associate are incurred in New Israeli Shekels (NIS), however the selling prices will be linked to the Company’s price list which will be determined in dollars, the budget is managed in dollars, financing activities including loans and cash investments, are made in U.S. dollars and the Company’s management believes that the dollar is the primary currency of the economic environment in which the Company and its subsidiary operates. Thus, the dollar is the Company’s and its subsidiary functional and reporting currency.

Accordingly, transactions denominated in currencies other than the functional currency are re-measured to the functional currency in accordance with Accounting Standards Codification (“ASC”) No. 830, “Foreign Currency Matters” at the exchange rate at the date of the transaction or the average exchange rate in the relevant reporting period. At the end of each reporting period, financial assets and liabilities are re-measured to the functional currency using exchange rates in effect at the balance sheet date. Non-financial assets and liabilities are re-measured at historical exchange rates. Gains and losses related to re-measurement are recorded as financial income (expense) in the statements of operations as appropriate.

The functional currency of the affiliate company is the NIS and therefore foreign exchange differences are charged to the other comprehensive profit and loss.

Cash and cash equivalents:

Cash equivalents are short-term highly liquid investments which include short term bank deposits (up to three months from date of deposit), that are not restricted as to withdrawals or use that are readily convertible to cash with maturities of three months or less as of the date acquired.

Investment in affiliated companies

Affiliated company is company held to the extent of 20% or more (which are not subsidiary), or company less than 20% held, which the Company can exercise significant influence over operating and financial policy of the affiliate.

CHARGING ROBOTICS INC.

(FORMERLY FUEL DOCTOR HOLDINGS, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands except share and per share data

(UNAUDITED)

NOTE 2 – UNAUDITED INTERIM CONDENSED FINANCIAL STATEMENTS (CONT.)

The investment in the affiliated company is accounted for by the equity method under ASC Subtopic 323-30, “Investments - Equity Method and Joint Ventures: Partnerships, Joint Ventures, and Limited Liability Entities”. Upon initial recognition, the cost of investment is based on the direct costs of acquiring the investment including amounts incurred on behalf of the investee.

Following the acquisition, the Company recognizes its proportionate share of the affiliated company’s net income or loss after the date of investment. When previous losses have reduced the Common Stock investment account to zero, the Company continues to report its share of equity method losses in its statement of operations to the extent of and as an adjustment to other investments in the investee such as debt securities, long term loans or advances, if any. Such additional equity method losses are applied to the other investments based on the seniority of the other investments (priority in liquidation) and the percentage ownership interest in each type of other investment the Company holds (the ‘relative holdings approach’).

Impairment of long-lived assets:

The Company’s long-lived assets are reviewed for impairment in accordance with ASC No. 360, “Property, Plant and Equipment” whenever events or changes in circumstances indicate that the carrying amount of an asset (or asset group) may not be recoverable. Recoverability of assets (or asset group) to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. During the year ended December 31, 2022, no impairment losses have been recorded.

Concentration of credit risks:

Financial instruments that potentially subject the Company to credit risk consist of cash and cash equivalents and restricted bank deposit. Cash and cash equivalents and restricted bank deposit are invested in major banks in Israel and the United States. Such funds in the Israel may be in excess of insured limits and are not insured in other jurisdictions. Management believes that the financial institutions that hold the Company and its subsidiary’ cash and cash equivalents have high credit ratings.

The Company, have no off-balance-sheet concentration of credit risk such as foreign exchange contracts, option contracts or other foreign hedging arrangements.

Research and development expenses:

Research and development costs are charged to the statement of operations as incurred.

Fair value of financial instruments:

ASC Topic 820, “Fair Value Measurements and Disclosures” (“ASC 820”), defines fair value as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants at the measurement date.

CHARGING ROBOTICS INC.

(FORMERLY FUEL DOCTOR HOLDINGS, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands except share and per share data

(UNAUDITED)

NOTE 2 – UNAUDITED INTERIM CONDENSED FINANCIAL STATEMENTS (CONT.)

In determining fair value, the Company uses various valuation approaches. ASC 820 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the inputs as follows:

Level 1	—	Valuations based on quoted prices in active markets for identical assets that the Company has the ability to access.

Level 2	—	Valuations based on one or more quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

Level 3	—	Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

The carrying amounts of cash and cash equivalents, other current assets, accounts payables and current liabilities approximate their fair value due to the short-term maturity of such instruments.

Income Tax:

The Company account for income taxes in accordance with ASC 740, “Income Taxes” which prescribes the use of the liability method whereby deferred tax assets and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value if it not is more likely than not that a portion or all of the deferred tax assets will be realized. Based on ASC 740, a two-step approach is used to recognize and measure uncertain tax positions. The first step is to evaluate the tax position taken or expected to be taken in a tax return by determining if the weight of available evidence indicates that it is more likely than not that, on an evaluation of the technical merits, the tax position will be sustained on audit, including resolution of any related appeals or litigation processes.

The second step is to measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. As of December 31, 2023, no liability for unrecognized tax positions has been recorded. Accordingly, no interest or penalties related to uncertain tax positions are recorded, either. It is the Company’s policy that any interest or penalties associated with unrecognized tax positions would be reflected in income tax expense.

Contingencies:

The Company records accruals for loss contingencies arising from claims, litigation and other sources when it is probable that a liability has been incurred and the amount can be reasonably estimated. These accruals are adjusted periodically as assessments change or additional information becomes available. Legal costs incurred in connection with loss contingencies are expensed as incurred.

CHARGING ROBOTICS INC.

(FORMERLY FUEL DOCTOR HOLDINGS, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands except share and per share data

(UNAUDITED)

NOTE 2 – UNAUDITED INTERIM CONDENSED FINANCIAL STATEMENTS (CONT.)

Stock-based payments:

The Company measures and recognizes the compensation expense for all equity-based payments to employees based on their estimated fair values in accordance with ASC 718, “Compensation-Stock Compensation”. Share-based payments including grants of stock options are recognized in the statement of comprehensive loss as an operating expense based on the fair value of the award at the date of grant. The fair value of stock options granted is estimated using the Black-Scholes option-pricing model. The Company has expensed compensation costs, net of estimated forfeitures, applying the accelerated vesting method, over the requisite service period or over the implicit service period when a performance condition affects the vesting, and it is considered probable that the performance condition will be achieved.

Share-based payments awarded to consultants (non-employees) are accounted for in accordance with ASC Topic 505-50, “Equity-Based Payments to Non-Employees”.

For the six months ended June 30, 2024, the Company recorded $3, in share-based compensation (see note 5(b)).

Basis of Presentation and Principles of Consolidation:

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary and were prepared in accordance with Generally Accepted Accounting Principles in the United States of America (“GAAP”)

All intercompany accounts and transactions have been eliminated in consolidation.

Unaudited Interim Financial Information

The Company’s unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted from this report, as is permitted by such rules and regulations. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of a normal recurring nature, which are necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented.

The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements. In the opinion of the Company’s management, the accompanying unaudited condensed financial statements contain all adjustments that are necessary to present fairly the Company’s financial position and results of operations for the interim periods presented. The results for the six months ended June 30, 2024, are not necessarily indicative of the results for the year ending December 31, 2024, or for any future period.

Accordingly, these condensed consolidated financial statements should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2023, and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on March 12, 2024 (the “2023 Annual Report”).

As of June 30, 2024, there have been no material changes in the Company’s significant accounting policies from those that were disclosed in the 2023 Annual Report.

CHARGING ROBOTICS INC.

(FORMERLY FUEL DOCTOR HOLDINGS, INC.)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands except share and per share data

(UNAUDITED)

NOTE 3 – GOING CONCERN

The condensed consolidated financial statements have been prepared on a going concern basis which assumes the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future. The Company has incurred a loss since inception resulting in an accumulated deficit of $1,966, as of December 31, 2023, and $2,348, as of June 30, 2024, and further losses are anticipated in the development of its business. Management expects the Company to continue to generate substantial operating losses and to continue to fund its operations primarily through utilization of its current financial resources and through additional raises of capital.

Such conditions raise substantial doubts about the Company’s ability to continue as a going concern. Management’s plan includes raising funds from outside potential investors. However, there is no assurance such funding will be available to the Company or that it will be obtained on terms favorable to the Company or will provide the Company with sufficient funds to meet its objectives. These consolidated financial statements do not include any adjustments relating to the recoverability and classification of assets, carrying amounts or the amount and classification of liabilities that may be required should the Company be unable to continue as a going concern.

NOTE 4 – INVESTMENT IN AFFILIATED COMPANY

On April 24, 2021, CR Israel invested $250 and purchased 19.99% of the share capital of Revoltz Ltd (“Revoltz”), an Israeli private company focusing on research, development and production of micro-mobility vehicles for the urban environment for the business and the private markets.

On July 28, 2022, CR Israel entered into a convertible loan agreement with Revoltz pursuant to which CR Israel was required to invest an amount of $60 in Revoltz (the “Loan Principal Amount”). In addition, CR Israel provided Revoltz further lending of up to $340 (the “Additional Amount”, and together with the Loan Principal, the “Total Loan Amount”). The Total Loan Amount shall carry interest at the minimum rate prescribed by Israeli law.

The Total Loan Amount shall be converted into shares of Revoltz, upon the occurrence of any of the following events (each a “Trigger Event”):

The consummation of funding by Revoltz of an aggregate amount of $1,000 at a pre-money Revoltz valuation of at least $7,000 (in the form of SAFE, equity or otherwise);

ii)

Revoltz has generated an aggregate of $1,000 or more in revenue.

In the event that a Trigger Event shall not have occurred on or prior to the 24-month anniversary of the date on which the Loan Principal Amount is actually extended to Revoltz, the Loan shall be due and repayable by Revoltz to the Company.

On June 30, 2024, the balance of the Loan Principal Amount was $63.

The following table summarizes the equity method accounting for the investment in affiliated company:

Balance January 1, 2023	$	152
Share in losses of affiliated company		(27	)
Foreign currency translation		(15	)
Balance December 31, 2023	$	110
Share in losses of affiliated company		(23	)
Foreign currency translation		(4	)
Balance June 30, 2024	$	83

CHARGING ROBOTICS INC.

(FORMERLY FUEL DOCTOR HOLDINGS, INC.)

NOTES TO THE condensed CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands except share and per share data

(UNAUDITED)

NOTE 5 – RELATED PARTIES

In support of the Company’s efforts and cash requirements, the Company may rely on advances from related parties until such a time that the Company can support its operations or attains adequate financing through sales of stock or traditional debt financing. There is no formal written commitment for continued support by related parties.

(i)

The compensation to key management personnel for employment services they provide to the Company is as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Consulting Fees – CEO	$	20	$	21	$	41	$	42
Consulting Fees - CFO	$	9	$	11	$	18	$	20
Directors’ compensation	$	9	$	-	$	30	$	6

(ii)

Balances owed to (by) related parties

	June 30,			December 31,
	2024			2023
Consulting Fees – CEO	$	27		$	8
Consulting Fees – CFO		6			8
Directors		57			27
Revoltz (see note 4b)		(63	)		(62	)
Medigus (see note 5c)		56			55
	$	83		$	36

The Company currently operates out of an office of a related party free of rent.

As of January 1, 2023, CR Israel owed a related party $550 (the “Medigus Loan”). The Medigus Loan bears interest in accordance with section 3(i) of the Israeli tax code (2.42% annually during 2022) and no fixed date for repayment has been determined. On January 1, 2023, CR Israel and Medigus signed an agreement to amend the terms of the Medigus Loan (the “Medigus Loan Agreement”). Pursuant to the Medigus Loan Agreement, the interest rate remains unchanged, and the capital and interest was to be repaid in cash or shares, or a combination thereof by June 30, 2023. On April 4, 2023, the Medigus Loan balance owing was $553. $509 of the Medigus Loan was converted into 28 shares of CR Israel and the remaining Medigus Loan balance will be repaid in cash. The Company is in discussions with Medigus to extend the repayment date of the remaining loan balance.

On October 1, 2021, CR Israel signed a consulting agreement with the CEO, pursuant to which CR Israel will pay the CEO a monthly fee of NIS 24,700 (approximately $7). Subject to approval of CR Israels’ board of directors (“Board”), the CEO shall be entitled to receive stock options in the Company that will entitle him to own 3% of Charging Robotics. The options will have an exercise price equivalent to a Company valuation of $10,000. As of the date of this report, the options have not been issued as the Board has not yet approved their issuance.

During the six months ended June 30, 2024, the CEO earned $41 (during the six months ended June 30, 2023 - $42).

CHARGING ROBOTICS INC.

(FORMERLY FUEL DOCTOR HOLDINGS, INC.)

NOTES TO THE condensed CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands except share and per share data

(UNAUDITED)

NOTE 6 – COMMON STOCK AND PREFERRED STOCK

As of June 30, 2024, and December 31, 2023, the Company’s share capital is composed as follows:

	June 30, 2024				December 31, 2023
	Authorized		Issued and outstanding		Authorized		Issued and outstanding
Shares of Common Stock		2,990,000,000		9,151,040		2,990,000,000		9,151,040
Shares of Preferred Stock		10,000,000		-		10,000,000		-

On March 22, 2022, the Company amended its Certificate of Incorporation and increased the number of authorized shares to 3,000,000,000 with a par value of $0.0001 of which 2,990,000,000 shares shall be Common Stock and 10,000,000 shares shall be preferred stock with a par value of $0.0001.

There were no shares of preferred stock of the Company, par value $0.0001 per share (“Preferred Stock”) outstanding at June 30, 2024, and December 31, 2023.

Each share of Common Stock is entitled to receive dividends, participate in the distribution of the Company’s net assets upon liquidation, and to receive notices of participation and vote (at one vote per share of Common Stock) at the general meetings of the Company on any matter upon which the general meeting is authorized.

On April 23, 2024, the Company received notice from FINRA that the Name Change and the Reverse Stock Split had been announced on FINRA’s daily list and would take effect at market open on the Market Effective Date. Accordingly, the FINRA corporate action to effect the Name Change and the Reverse Stock Split is now completed. Consequently, all share numbers, share prices, and exercise prices have been retroactively adjusted in these consolidated financial statements for all periods presented.

During June 2024, the Company received a total of $65 on account of 118,182 shares of Common Stock, to be issued by the Company to three investors, at a price per share of $0.55.

CHARGING ROBOTICS INC.

(FORMERLY FUEL DOCTOR HOLDINGS, INC.)

NOTES TO THE condensed CONSOLIDATED FINANCIAL STATEMENTS

U.S. dollars in thousands except share and per share data

(UNAUDITED)

NOTE 6 – COMMON STOCK AND PREFERRED STOCK (CONT.)

Warrants:

(i)

Pursuant to the Acquisition (as defined in Note 1), the Company issued the previous shareholders of CR Israel 6,150,000 warrants exercisable upon the Company achieving each of the three (3) performance milestones (collectively, the “Earn Out Milestones”) as follows:

●

In-house demonstration for automatic robotic charging of an electric vehicle – until December 31, 2025.

●

Conditional purchase order for first system for automatic car parks – until December 31, 2025.

●

Commercial agreement for pilot with an organization which was approved by the board – until December 31, 2025.

All Earn Out Milestones shall immediately accelerate upon the Company uplisting to the Nasdaq stock exchange.

(ii)

On June 20, 2024, the Company issued Automax Motors Ltd. a warrant to purchase 122,831 shares of Common Stock (collectively, the “Automax Warrant”). The exercise price of the Automax Warrant was set at $12.82 per share, and the expiry date of the Automax Warrant is September 20, 2027. The fair value of the Automax Warrant granted was $19, using the Black-Scholes option pricing model using the following assumptions:

(iii)

A summary of warrant activity during the period is as follows:

	Number		Average weighted exercise price

Warrants outstanding at December 31, 2023		6,150,000	$	0.00
Warrant Granted (iv)		122,831		12.82
Warrants outstanding at June 30, 2024		6,272,831	$	0.25

Warrants exercisable at June 30, 2024		122,831	$	12.82

Options in CR Israel

On February 1, 2022, CR Israel issued 4 options to Ben Gurion University (the “BGU Options”) with an exercise price of $0.01. The BGU Options expire on January 1, 2032. The fair value of the BGU Options granted was $30, using the Black-Scholes option pricing model using the following assumptions:

	January 2022
CR Israel share price	$	7,410
CR Israel Exercise price	$	0.01
Dividend yield		0	%
Risk-free interest rate		0.48	%
Expected term (in years)		10
Volatility		75	%

For the six months ended June 30, 2024, the Company recorded $3 in share-based compensation expenses in respect of the BGU Options (as compared to during the six months ended June 30, 2023, which was - $7).

NOTE 7 – SUBSEQUENT EVENTS

The Company evaluated all other events or transactions that occurred through August 13, 2023. The Company determined that it does not have any other subsequent event requiring recording or disclosure in the financial statements for the six months ended June 30, 2024, other than described below:

On July 3, 2024, the Company received $20 from an investor in consideration for the issuance of 36,364 shares of Common Stock, to be issued by the Company to the investor, at a price per share of $0.55.

ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following discussion and analysis should be read in conjunction with, and is qualified in its entirety by, our consolidated financial statements (and notes related thereto) and other more detailed financial information appearing elsewhere in this Quarterly Report on Form 10-Q. Consequently, you should read the following discussion and analysis of our financial condition and results of operations together with such financial statements and other financial data included elsewhere in this Quarterly Report on Form 10-Q. Some of the information contained in this discussion and analysis are set forth elsewhere in this prospectus, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. You should review the “Risk Factors” section of our most recent Annual Report on Form 10-K for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Statements in this section and elsewhere in this Form 10-Q that are not statements of historical or current fact constitute “forward-looking” statements.

All information in this Quarterly Report on Form 10-Q relating to shares or price per share reflects the 1-for-150 reverse stock split effected by us on August 28, 2023, with the shares beginning trading on a post-split basis on the OTC Market on April 23, 2024.

OVERVIEW OF OUR PERFORMANCE AND OPERATIONS

Recent Developments

Our current product which we are pilot testing with an Automated Parking System (“APS”) supplier in Israel is a system that wirelessly charges electric vehicles (“EVs”) in APSs. Upon arrival at the APS, the driver parks the EV on a plate used by the APS to transport the EV to the final parking location. The EV remains on the plate until it is retrieved by the APS and the driver enters the EV departs. When a driver parks an EV on these charging plates, they connect a regular charging cable to a socket installed on the plate, at which point the plate moves through the APS via conveyors and elevators to the parking location. Our system is installed in two parts. The electricity receiving component is installed on the plate and consists of a receiving coil and supporting electronics and a socket where the driver connects a cable to the charging socket of the EV. The system’s transmitting component is installed in the APS facility and consists of a transmitting coil and the supporting electronics. As the driver parks the EV and connects the cable from the plate to the EV, he initiates that charging using our mobile application. Once initiated, the system goes into standby mode. Upon the plate arriving at its final parking location, charging of the EV begins. When the plate and EV are in the final parking position, the transmitting coil and the receiving coil are in proximity and by way of electromagnetic induction, electricity passes from the stationary part (transmitting) of the system to the moving (receiving) part of the system. This enables the charging of EVs in places where drivers can not enter and manually connect a plug.

Although we have decided to currently focus on the solution for APSs, longer term future products will include the robotic solutions on which the Company was founded. We have succeeded in developing a tethered robotic solution. This robot was intended to charge an EV of a disabled driver and offer an automatic method for wireless charging of EVs. This solution will offer a big benefit for disabled drivers who have difficulty using a regular plug-and-cable-based charger. For these drivers, it is merely impossible to exit the EV, go to the charger, take the cable and connect the plug to the EV. Using our solution, charging will be performed automatically using the tethered robot. As the driver parks the EV, that robot will recognize the EV and will automatically navigate under the EV and charge it wirelessly. For this we have developed a patent-pending technology to navigate to the EV using data obtained by lidar (laser-based) sensors viewing only the EV’s wheels.

On November 22, 2023, the Company announced that it received approval for funding from the Israel Innovation Authority (“IIA”) for a pilot project that includes installing and demonstrating its solution for wireless charging of EVs in APSs. The total approved budget for this project is approximately $445, of which the IIA will finance 50%. The Company is now engaged in the project to implement the solution in an APS in Tel Aviv. This project was intended to be completed by July 2024, but due to the Israel Hamas war (see below), we have extended it by three months, with approval from the IAA. At the time of this filing, we are on track with our plan to upgrade the system, based on data gathered thus far during the project, with the intent to subsequently commercialize the resulting product. We still anticipate that by September 2024 we will have completed this trajectory and be ready to sell our proprietary charging solution. We have begun working on obtaining regulatory approvals for the product and plan to receive Israel Standardization Institute approval by December 2024.

Recently, we also received a purchase order from an APS provider in Israel for installation of multiple systems in June 2025. We are also in discussions with three other APS providers in Israel. The combined forecast from these customers and potential customers is installation of approximately thirty systems by the end of 2024. We see this growth as indicative of a favorable response from the market to our systems.

In order to prepare to meet this increased market demand, we are in the process of establishing subcontractor-based production capabilities, working on increasing our work force and sourcing office and R&D spaces, and are already in discussions with various locations.

On April 23, 2024, the Company received notice from FINRA that the Name Change and the Reverse Stock Split was announced on FINRA’s daily list and would take effect at market open on the Market Effective Date. Accordingly, the FINRA corporate action to effect the Name Change and the Reverse Stock Split is now completed. Consequently, all share numbers, share prices, and exercise prices have been retroactively adjusted in this management’s discussion and analysis of financial condition and results of operations.

Hamas-Israel War

In October 2023, Hamas terrorists infiltrated Israel’s southern border from the Gaza Strip and conducted a series of attacks on civilian and military targets. Hamas also launched extensive rocket attacks on the Israeli population and industrial centers located along Israel’s border with the Gaza Strip and in other areas within the State of Israel. These attacks resulted in thousands of deaths and injuries, and Hamas additionally kidnapped many Israeli civilians and soldiers. Following the attack, Israel’s security cabinet declared war against Hamas and commenced a military campaign against Hamas and other terrorist organizations in parallel to their continued rocket and terror attacks. In addition, since the commencement of these events, there have been continued hostilities along Israel’s northern border with Lebanon (with the Hezbollah terror organization) and southern border (with the Houthi movement in Yemen), including a recent direct attack by the Houthis on July 19, 2024, which struck a residential building in Tel Aviv, Israel, killing one civilian and injury more. As hostilities with Hezbollah in Lebanon continue to escalate, it is possible that other terrorist organizations, including Palestinian military organizations in the West Bank as well as other hostile countries will join the hostilities. In addition, Iran recently launched a direct attack on Israel involving hundreds of drones and missiles and has threatened to continue to attack Israel. and is widely believed to be developing nuclear weapons. Iran is also believed to have a strong influence among extremist groups in the region, such as Hamas in Gaza, Hezbollah in Lebanon, the Houthi movement in Yemen and various rebel militia groups in Syria and Iraq. Such clashes may escalate in the future into a greater regional conflict.

Results of Operations for the six months ended June 30, 2024 and June 30, 2023

Revenues

We have generated revenues of $0 and $0 for the six months ended June 30, 2024, and June 30, 2023, respectively.

Operating expenses

Operating expenses for the six months ended June 30, 2024, were $362 thousand compared with $305 thousand for the six months ended June 30, 2023. The increase in operating expenses in 2024 is due to an increase in general and administrative expenses. Research and development expenses for the six months ended June 30, 2024, were $148 thousand, compared to $149 thousand for the six months ended June 30, 2023. General and administrative expenses increased by $58 thousand, from $156 thousand for the six months ended June 30, 2023, to $214 thousand for the six months ended June 30, 2024. The increase is due to increased business and other operational activity in the Company, including the completion of our first pilot project with Parkomot.

Results of Operations of the Company for the three months ended June 30, 2024 and June 30, 2023

Revenues

We have generated revenues of $0 and $0 for the three months ended June 30, 2024 and June 30, 2023, respectively.

Operating expenses

Operating expenses for the three months ended June 30, 2024, were $181 thousand compared with $181 thousand for the three months ended June 30, 2023. Research and development expenses for the three months ended June 30, 2024, amounted to $85 thousand, compared to $37 thousand for the three months ended June 30, 2023. The increase is due mainly to an increase in subcontractor expenses. During the period we completed our first pilot project with Parkomot. General and administrative expenses decreased by $48 thousand, from $144 thousand for the three months ended June 30, 2023, to $96 thousand for the three months ended June 30, 2024.

Liquidity and Capital Resources

As of June 30, 2024, and December 31, 2023, the Company’s cash balance was $38 thousand and $8 thousand, respectively.

As of June 30, 2024, and December 31, 2023, the Company’s total assets were $302 thousand and $323 thousand, respectively.

As of June 30, 2024, the Company had total liabilities of $740 thousand, that consisted of $264 thousand in accounts payable and accrued liabilities, $146 thousand in related parties, $65 thousand in receipt upon investment in our shares, $31 thousand in deferred revenues and $234 thousand in short term loans.

As of December 31, 2023, the Company had total liabilities of $397 thousand, that consisted of $220 thousand in accounts payable and accrued liabilities, $98 thousand in related parties, $49 thousand in deferred revenues, and $30 thousand in short term loans.

As of June 30, 2024, the Company had a negative working capital of $657 thousand. As of December 31, 2023, the Company had negative working capital of $297 thousand.

Working Capital and Cash Flows (in thousands of U.S. Dollars)

Working Capital

	June 30, 2024			December 31, 2023

Current assets	$	52		$	51
Current liabilities		709			348
Working capital deficit	$	(657	)	$	(297	)

Cash Flows

	June 30, 2024			June 30, 2023

Cash flow used generated in operating activities	$	(232	)	$	(342	)
Cash flow used in investing activities		(4	)		-
Cash flows from financing activities		266			592
Net increase in cash during the period	$	30		$	250

Cash flows from operating activities

During the six months ended June 30, 2024, we had negative cash flow from operations of $232 thousand compared to a negative cashflow of $342 thousand for the six months ended June 30, 2023.

Cash flows from investing activities

During the six months ended June 30, 2024, we had negative cash flow from investing activities of $4 thousand, compared to a zero cashflow for the six months ended June 30, 2023.

Cash flows from financing activities

During the six months ended June 30, 2024, we had a positive cash flow from financing activities of $266 thousand, compared to a cashflow of $592 thousand for the six months ended June 30, 2023.

Critical Accounting Policies

Going Concern

We have not attained profitable operations and are dependent upon the continued financial support from our shareholders, the ability to raise equity or debt financing, and the attainment of profitable operations from our future business. These factors raise substantial doubt regarding our ability to continue as a going concern.

Our ability to continue as a going concern is dependent upon our ability to generate future profitable operations and/or to obtain the necessary financing to meet our obligations and repay our liabilities arising from normal business operations when they come due.

The Company, as of June 30, 2024, had $38 thousand in cash and has not generated any revenues from operations to date. For the six months ending June 30, 2024, and June 30, 2023, our operating expenses amounted to $362 thousand and $305 thousand, respectively. In the previous two fiscal years our operating expenses were $740 thousand and $753 thousand for the years ended December 31, 2023 and December 31, 2022, respectively.

The Company continues to rely on borrowings and financings. In the next 12 months we expect to incur expenses equal to approximately $1 million to advance Charging Robotics’ product and expenses related to legal, accounting, audit and other professional service fees incurred in relation to the Company’s status as a U.S. reporting company. These conditions raise substantial doubt about our ability to continue as a going concern. The Company is currently devoting its efforts to raise further funds. The Company’s ability to continue as a going concern is dependent upon our ability to develop additional sources of capital, locate and complete a merger with another company, and ultimately, achieve profitable operations. There is no assurance that we will in fact have access to additional capital or financing as a public company.

Off-Balance Sheet Arrangements

We have not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources and would be considered material to investors.

Default on Notes

There are currently no notes in default.

Other Contractual Obligations

As of the year ended December 31, 2023 and the six months ended June 30, 2024, we did not have any contractual obligations, other than those already disclosed in our most recent annual report on Form 10-K.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 3.

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures.

We carried out an evaluation, under the supervision and with the participation of our management, including our chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Disclosure controls and procedures include, without limitation, means controls and other procedures that are designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms and (ii) accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Based on this evaluation, because of the Company’s limited resources and lack of employees, management, including our chief executive officer and chief financial officer, concluded that our disclosure controls and procedures were ineffective as of June 30, 2024 and as of the date of this filing, August 13, 2024.

Management has identified control deficiencies regarding inadequate accounting resources, the lack of segregation of duties and the need for a stronger internal control environment. Management of the Company believes that these material weaknesses are due to the small size of the Company’s accounting staff. The small size of the Company’s accounting outsourced staff may prevent adequate controls in the future due to the cost/benefit of such remediation.

To mitigate the current limited resources and limited employees, we rely heavily on direct management oversight of transactions, along with the use of external legal and accounting professionals. As we grow, we expect to increase our number of employees, which will enable us to implement adequate segregation of duties within the internal control framework.

These control deficiencies could result in a misstatement of account balances that would result in a reasonable possibility that a material misstatement to our consolidated financial statements may not be prevented or detected on a timely basis. In light of this material weakness, we performed additional analyses and procedures in order to conclude that our consolidated financial statements for the quarter ended June 30, 2024 included in this Quarterly Report on Form 10-Q were fairly stated in accordance with GAAP. Accordingly, management believes that despite our material weaknesses, our consolidated financial statements for the quarter ended June 30, 2024 are fairly stated, in all material respects, in accordance with GAAP.

Limitations on Effectiveness of Controls and Procedures

Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all errors and all fraud. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include, but are not limited to, the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Changes in Internal Control over Financial Reporting

No changes in the Company’s internal control over financial reporting have come to management’s attention during the Company’s last fiscal quarter that have materially affected, or are likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

We are not aware of any pending or threatened legal proceedings involving our Company or its assets.

ITEM 1A. RISK FACTORS

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 1A.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

During the quarter ended March 31, 2024, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement” (in each case, as defined in Item 408 of Regulation S-K).

ITEM 6. EXHIBITS.

Exhibit Number		Description
31.1		Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2		Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1		Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2		Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
EX-101.INS		Inline XBRL Instance Document*
EX-101.SCH		Inline XBRL Taxonomy Extension Schema Document*
EX-101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document*
EX-101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document*
EX-101.LAB		Inline XBRL Taxonomy Extension Labels Linkbase Document*
EX-101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document*
EX-104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)*

The XBRL related information in Exhibit 101 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liability of that section and shall not be incorporated by reference into any filing or other document pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing or document.

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.

	CHARGING ROBOTICS INC.

Date: August 13, 2024	By:	/s/ Hovav Gilan
		Name:	Hovav Gilan
		Title:	Chief Executive Officer
			(Principal Executive Officer)

	By:	/s/ Gadi Levin
		Name:	Gadi Levin
		Title:	Chief Financial Officer
			(Principal Financial and Accounting Officer)

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Charging Robotics Inc. 10-Q