XWELL, Inc.
For the period ended Dec 31, 2025. Filed Apr 1, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Apr 1, 2026
XWEL$0.59+2.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-04-15.
0001558370-25-004851
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-K
Period ended 2025-12-31; filed 2026-04-01.
0001104659-26-038330
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 69 previous paragraphs and 108 current paragraphs.
36 unchanged; 16 reworded; 53 added; 17 removed; 0 previous and 3 current paragraphs rearranged.
Tables are not compared: 10 previous and 14 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (53)
Current report
May 2025 Warrant Amendment
Current report
On May 16, 2025, the Company entered into an omnibus amendment (the “Warrant Amendment”) with each of the holders of the Series A Warrants and Series B Warrants. The Warrant Amendment makes certain adjustments to the definition of a “Fundamental Transaction” in each of the Warrants, as described in the Warrant Amendment, including changing the scope of the definition applicable to tender or exchange offers that the Company makes, allows one or more Subject Entities (as defined in the Warrant Agreement) to make, or allows the Company to be subject to, to require such a tender or exchange offer to represent more than 50% of the outstanding voting power of the Company. Further, the Warrant Amendment modifies certain terms of the Warrants relating to the rights of the holders in the event of a Fundamental Transaction (as defined in each of the Series A Warrants and Series B Warrants, and as each amended by the Warrant Amendment) that is not within the Company’s control, including that upon a Fundamental Transaction not being approved by the Company’s Board of Directors, the holders of the Warrants shall only be entitled to receive from the Company or any successor entity the same type or form of consideration (and in the same proportion), at the Black Scholes Value (as defined in each of the Series A Warrants and Series B Warrants and as each amended by the Warrant Amendment, as described below) of the unexercised portion of such Warrants, that is being offered and paid to the holders of the Company’s Common Stock. In addition, the Amendment revises the definition of Black Scholes Value related to the volatility input which is now an expected volatility equal to the 30 day volatility obtained from the “HVT” function on Bloomberg (determined utilizing a 365 day annualization factor) as of the trading day immediately following the earliest to occur of (1) the public disclosure of the applicable Fundamental Transaction and (2) the date of a holder’s request.
Current report
November 2025 Exchange Agreement
Current report
On November 3, 2025, the Company entered into a Securities Exchange and Amendment Agreement (the “Exchange Agreement”) with the January 2025 Investors, pursuant to which, the Company exchanged a portion of the Company’s outstanding shares of Series G Preferred Stock, including all accrued and unpaid dividends thereon equal to $1,800 in aggregate Stated Value, held by the January 2025 Investors, for senior secured convertible notes (collectively, the “Notes”) in the aggregate principal amount of $3,387 (collectively, the “Exchange”). The Notes were convertible into shares of the Company’s Common Stock in accordance with their terms and were secured by a first priority security interest in the assets of the Company and its subsidiaries. The Exchange closed on November 10, 2025 (the “Closing Date”).
Current report
In connection with the Exchange, the Company and the January 2025 Investors agreed to (A) amend certain terms of the Company’s Series G Preferred Stock as set forth in a Certificate of Amendment (the “Certificate of Amendment”) to the Certificate of Designations of the Series G Convertible Preferred Stock (the “Certificate of Designations”) as described below, and (B) amend and restate the January 2025 Investors’ (i) Series A warrants (the “Amended and Restated Series A Warrants”) and (ii) Series B Warrants (the “Amended and Restated Series B Warrants” and, collectively with the Amended and Restated Series A Warrants, the “Amended and Restated Warrants”) to (A) reduce the exercise price of the Warrants to $1.00, and (B) add certain anti-dilution provisions such that the exercise price of the Warrants will be subject to price-based adjustment in the event of any issuances of Common Stock, or securities convertible, exercisable or exchangeable for Common Stock, at a price below the then-applicable exercise price.
Current report
February 2026 Private Placement
Current report
On February 24, 2026, the Company entered into the February 2026 Purchase Agreement with the a certain accredited investor (the “February 2026 Purchaser”) for the issuance and sale in a private placement of an aggregate of (i) 31,333 shares of the Company’s newly-designated Series H Convertible Preferred Stock, par value of $0.01 per share and a stated value of $1,000 per share (the “Series H Preferred Stock”), initially convertible into up to 66,665,957 shares of common stock, at an initial conversion price of $0.47 per share, subject to adjustment for certain customary adjustments, and (ii) the warrants (the “February 2026 Warrants”) to purchase up to 66,665,957 shares of common stock, at an initial exercise price of $0.345 per share, subject to adjustment for certain customary adjustments, for aggregate gross proceeds of approximately $31,300. The February 2026 Warrants expire three years from the date of issuance. The February 2026 Private Placement closed on February 27, 2026.
Current report
In connection with the February 2026 Private Placement, pursuant to a placement agency agreement (the “Placement Agency Agreement”), dated as of February 24, 2026, by and between the Company and Dominari Securities LLC (the “Placement Agent”), the Company engaged the Placement Agent to act as an exclusive placement agent in connection with the February 2026 Private Placement and agreed to (i) pay to the Placement Agent (a) a cash fee equal to 8% of the gross proceeds of the February 2026 Private Placement and (b) reimbursements and payments of certain expenses, including non-accountable expense allowance equal to 1% of the gross proceeds raised in the February 2026 Private Placement and reasonable out-of-pocket expenses, not to exceed $250, and (ii) issue to the Placement Agent warrants (the “Placement Agent Warrants”) to purchase up to an aggregate number of shares of Common Stock equal to 8% of the aggregate number of shares of common stock underlying the securities issued in the February 2026 Private Placement, with terms identical to the February 2026 Warrants, except that the Placement Agent Warrants have a term of five (5) years from the date of issuance. The Placement Agency Agreement contains customary representations, warranties and agreements of the parties, and customary indemnification obligations of the Company.
Current report
In connection with the February 2026 Private Placement, the Company entered into a registration rights agreement (the “Registration Rights Agreement”) with the February 2026 Purchaser and the Placement Agent, pursuant to which the Company has agreed to prepare and file a registration statement with the SEC registering the resale of the shares of common stock underlying the Series H Preferred Stock and shares of common stock underlying the February 2026 Warrants and the Placement Agent Warrants no later than the earlier of (a) 50 days after the later of (1) the closing date of the February 2026 Private Placement or (2) the Escrow Release Date (as defined in the Registration Rights Agreement) and (b) the second trading day following the date on which the Company files its Annual Report on Form 10-K for the year ended December 31, 2025 (the “Filing Deadline”), and to use best efforts to have the registration statement declared effective as promptly as practical thereafter, and in any event no later than 60 days following the Filing Deadline (or 90 days following the Filing Deadline in the event of a “full review” by the SEC).
Current report
The Company used the net proceeds from the February 2026 Private Placement, in part, to repurchase certain outstanding indebtedness, redeem previously issued preferred equity and warrants in the Repurchase (see below February 2026 Omnibus Agreement).
Current report
February 2026 Omnibus Agreement
Current report
On February 24, 2026, the Company entered into the Omnibus Agreement, by and between the Company and January 2025 Investors, pursuant to which, the Company agreed to (i) repurchase from the January 2025 Investors $5,673 of aggregate principal amount of the Notes, representing the entire outstanding principal amounts of the Notes and any accrued and unpaid interest thereon, (ii) redeem 196 shares of Series G Preferred Stock held by the January 2025 Investors, including $283 of accrued and unpaid dividends thereon, representing all outstanding shares of Series G Preferred Stock, and (iii) redeem all Amended and Restated Warrants held by the January 2025 Investors, representing all outstanding Series A Warrants and Series B Warrants, for an aggregate cash purchase price of $9,000 (collectively, the “Repurchase”). The Repurchase closed on March 2, 2026.
Current report
On March 4, 2026, the Company filed a Certificate of Elimination (the “Certificate of Elimination”) with respect to its Series G Preferred Stock, with the Delaware Secretary of State. The Certificate of Elimination (i) eliminates the previous designation of 4,000 shares of Series G Preferred Stock, none of which were outstanding at the time of filing, (ii) causes such shares of Series G Preferred Stock to resume the status of authorized but unissued shares of preferred stock of the Company and (iii) eliminates all reference to the Series G Preferred Stock from the Company’s Amended and Restated Certificate of Incorporation, as amended.
Current report
Preferred Stock
Current report
The terms of the Preferred Stock are set forth in the respective Certificate of Designations. The shares of Series H Preferred Stock are convertible into the Conversion Shares at the election of the holders of the Series H Preferred Stock (the “Holders”) at any time at an initial conversion price of $0.47 per share (the “Conversion Price”). The Conversion Price is subject to customary adjustments for stock dividends, stock splits, reclassifications, stock combinations and the like.
Current report
A Holder of the Series H Preferred Stock may not convert any portion of the Preferred Stock to the extent that the Holder, together with its affiliates, would beneficially own more than 4.99% of the Company’s outstanding shares of Common Stock immediately after conversion, except that upon at least 61 days’ prior notice from the Holder to the Company, the Holder may increase the beneficial ownership limitation to up to 9.99% of the number of shares of Common Stock outstanding immediately after giving effect to the conversion.
Current report
Pursuant to the Certificate of Designations, so long as any shares of the Series H Preferred Stock are outstanding, the Company may not, directly or indirectly, redeem, or declare or pay any cash dividend or distribution on, any securities of the Company without the prior express written consent of the Required Holders (as defined in the Certificate of Designations). In the event that dividends are consented to by the Required Holders, the Holders of the Series H Preferred Stock shall be entitled to receive dividends on shares of the Series H Preferred Stock equal (on an as-if-converted-to-Common-Stock basis) to and in the same form as dividends actually paid on shares of the Common Stock when, as and if such dividends are paid on shares of the Common Stock. No other dividends may be paid on shares of the Series H Preferred Stock.
Current report
Except as otherwise provided in the Certificate of Designations or as otherwise required by law, the Series H Preferred Stock will have no voting rights except as provided by law. However, as long as any shares of Preferred Stock are outstanding, the Company may not, without the affirmative vote at a meeting duly called for such purpose, or the written consent without a meeting, of the Required Holders, voting together as a single class, (a) amend or repeal any provision of, or add any provision to, its charter documents, including, without limitation, its Certificate of Incorporation or bylaws, the Certificate of Designation, or file any certificate of designations or articles of amendment of any series of shares of preferred stock, in each case, only if such action would adversely alter or change in any respect the preferences, rights, privileges or powers, or restrictions provided for the benefit, of the Series H Preferred Stock, regardless of whether any such action shall be by means of amendment to the Certificate of Incorporation or by merger, consolidation or otherwise; (b) increase or decrease (other than by conversion) the authorized number of shares of the Preferred Stock; (c) create or authorize (by reclassification or otherwise) any new class or series of shares that has a preference over the Preferred Stock with respect to dividends or the distribution of assets on the liquidation, dissolution or winding up of the Company; (d) pay dividends or make any other distribution on any shares of any capital stock of the Company junior in rank to the Preferred Stock; or (e) whether or not prohibited by the terms of the Preferred Stock, circumvent a right of the Preferred Stock.
Current report
There is no established public trading market for the Preferred Stock and the Company does not intend to list the Series H Preferred Stock on any national securities exchange or nationally recognized trading system.
Current report
Warrants
Current report
The exercise price of the Warrants is subject to customary adjustments for stock dividends, stock splits, reclassifications and the like. A holder of the Warrants may not exercise any portion of such holder’s Warrants to the extent that the holder, together with its affiliates, would beneficially own more than 4.99% of the Company’s outstanding shares of Common Stock immediately after exercise, except that upon at least 61 days’ prior notice from the holder to the Company, the holder may increase the beneficial ownership limitation to up to 9.99% of the number of shares of Common Stock outstanding immediately after giving effect to the exercise.
Current report
There is no established public trading market for the Warrants and the Company does not intend to list the Warrants on any national securities exchange or nationally recognized trading system.
Current report
Pro Forma Financial Statements
Current report
The Private Placement and Repurchase (collectively, the “Restructuring”) represent a significant restructuring of the Company’s capital including a significant repayment of debt. The accompanying unaudited pro forma consolidated balance sheet as of December 31, 2025 is presented as if the Restructuring had occurred on December 31, 2025. The Restructuring is not expected to have an impact on the Company’s consolidated statements of operations and thus no pro forma consolidated statement of operations is presented.
Current report
These unaudited pro forma condensed consolidated financial statements have been prepared in accordance with Article 11 of Regulation S-X and do not include all of the information and note disclosures required by generally accepted accounting principles of the United States.
Current report
The unaudited pro forma condensed consolidated financial information is subject to the assumptions and adjustments described in the accompanying notes. These assumptions and adjustments are based on information presently available. Actual adjustments may differ materially from the information presented. The unaudited pro forma consolidated financial statements are based on the historical financial statements of the Company for each period presented and in the opinion of the Company’s management, all adjustments and disclosures necessary for a fair presentation of the pro forma data have been made. These unaudited pro forma consolidated financial statements are presented for illustrative purposes only and are not necessarily indicative of the results of operations or financial condition that would have been achieved had events reflected been completed as of the dates indicated and may not be useful in predicting the impact of the reflected transactions on the future financial condition and results of operations of the Company due to a variety of factors.
Current report
The pro forma adjustments are based upon available information and certain assumptions that we believe are reasonable. The unaudited pro forma consolidated financial statements are for illustrative and informational purposes only and do not purport to represent what our financial position or results of operations would have been if the proposed transactions had actually occurred as of the dates indicated, nor does it project our financial position at any future date or our results of operations or cash flows for any future period.
Current report
The adjustments in the unaudited pro forma consolidated financial information have been identified and presented to provide relevant information necessary for an illustrative understanding of XWELL, Inc. upon consummation of the Restructuring. The unaudited pro forma transaction accounting adjustments presented in the accompanying notes represent management’s estimates based on information available as of the date of these unaudited pro forma consolidated financial statements and are subject to change as additional information becomes available and analyses are performed.
Current report
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
Current report
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
Current report
Nasdaq Minimum Bid Price Requirement
Current report
On December 1, 2025, we received a letter (the “Letter”) from the Listing Qualifications Department of the Nasdaq Stock Market indicating that, based upon the closing bid price of our common stock for the 30 consecutive business days between October 17, 2025, to November 28, 2025, we did not meet the minimum bid price of $1.00 per share required for continued listing on the Nasdaq pursuant to Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Price Rule”). The letter also indicated that we will be provided with a compliance period of 180 days (until June 1, 2026) (the “Compliance Period”), in which to regain compliance pursuant to Nasdaq Listing Rule 5810(c)(3)(A). On March 11, 2026, we received a letter from the Listing Qualifications Department of Nasdaq stating that for the last 10 consecutive business days, from February 25, 2026, to March 10, 2026, the closing bid price of our common stock had been at or greater than $1.00 per share. Accordingly, we have regained compliance with the Minimum Bid Price Rule and per the Letter, the matter is now closed.
Current report
During the year ended December 31, 2025, total revenues decreased $4,687, or 14%. The decrease was driven primarily by a decline in revenues within the XpresTest segment, reflecting reduced testing volumes. This decrease was partially offset by modest growth in service revenues from newly opened Naples Wax locations.
Current report
As of December 31, 2025, after recording ASC 360 long-lived asset impairments, the Company evaluated goodwill for impairment under ASC 350 using a qualitative assessment. In the absence of a contemporaneous quantitative valuation, and considering persistent losses, negative projected cash flows, and other adverse indicators, management concluded it was more-likely-than-not that the reporting unit’s fair value did not exceed it’s carrying amount. The Company therefore recorded a full impairment as of December 31, 2025, related to the Goodwill associated with the Naples Wax business, and as a result recognized an impairment charge of $1,389.
Current report
The increase in foreign exchange loss of $395 was primarily due to the fluctuation of the foreign exchange rate in Turkey, creating a remeasurement loss on our lease liability. The decrease in other non-operating expense of $44, net was primarily driven by a decrease in finance expenses related to bank fees and charges.
Current report
Change in fair value of warrants and derivatives
Current report
The change in fair value of derivatives and warrant liabilities during the year ended December 31, 2025 primarily reflects changes in the Company’s stock price and the impact of amendments to certain outstanding warrant agreements entered into in November 2025 in connection with the Securities Exchange and Amendment Agreement with holders of the Company’s Series G Convertible Preferred Stock. As part of this transaction, certain warrants were amended and restated and a portion of the outstanding Series G Convertible Preferred Stock was exchanged for senior secured convertible notes. These modifications affected the valuation assumptions used in measuring the related derivative and warrant liabilities at fair value. The loss on issuance is due to the initial fair value of the Series G Preferred Stock exceeding the fair value of the proceeds received.
Current report
Interest income, net
Current report
The increase of $281 was primarily driven by the recognition of $473 in interest income associated with the employee retention credit, partially offset by lower interest earned on cash balances during the period.
Current report
As of December 31, 2025, the Company had cash and cash equivalents of approximately $2,617, marketable securities of $7, total current assets of $5,910, total current liabilities of $12,892, and long term operating lease liabilities of $7,035. The Company’s working capital was in a deficit position at December 31, 2025, compared with a working capital surplus of $6,113 at December 31, 2024. These conditions, together with historical operating losses and negative cash flows from operations, previously raised substantial doubt about the Company’s ability to continue as a going concern within one year after the issuance of these financial statements.
Showing the first 40 of 53 passages. Open the source sections for the rest.
Removed paragraphs (17)
Previous report
During the year ended December 31, 2024, total revenues increased $3,788, or 13%. The increase in revenuewas primarily due to a full year service revenue generated from the acquired Naples Wax business and an increase in service revenue in the XpresSpa new touchless locations.
Previous report
Salaries and benefits
Previous report
During the year ended December 31, 2024, salaries and benefits expenses decreased by $414 or 5%, primarily due to the closing of unprofitable or poorly performing spas, optimization of systems and processes that support the business, headcount reductions and elimination of infrastructure no longer necessary to support our future growth.
Previous report
Our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern as we have suffered recurring losses from operations and have insufficient liquidity to fund our future operations. If we are unable to improve our liquidity position, we may not be able to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments that might result if we are unable to continue as a going concern and, therefore, be required to realize our assets and discharge our liabilities other than in the normal course of business which could cause investors to suffer the loss of all or a substantial portion of their investment. As of December 31, 2024, we had approximately $4,550 of cash and cash equivalents, $7,247 in marketable securities, and total current assets of approximately $15,337. Our total current liabilities balance, which includes accounts payable, deferred revenue, accrued expenses, and operating lease liabilities was approximately $9,224 as of December 31, 2024. The working capital surplus was $6,113 as of December 31, 2024, compared to a working capital surplus of $17,236 as of December 31, 2023.
Previous report
The Company significantly reduced operating and overhead expenses in the 2023 and 2024, while it continues to focus on returning to overall profitability.
Previous report
The Company has taken actions to improve its overall cash position, right sizing its corporate structure and streamlining its operations, while at the same time the Company is aggressively trying to get the company to profitability which the Company believes will strengthen the Company’s stock price and put the Company in a stronger position to be able to raise capital in 2025 and beyond. The Company is aggressively pursuing strategic partnerships that the Company expects will further strengthen the long-term profitability of the business, which puts the Company in a position of strength as the Company raises more capital.
Previous report
Our primary liquidity and capital requirements are for the maintenance of our current XpresSpa locations and brand, as well as the expansion outside the airports. During the year ended December 31, 2024, we used net cash of $11,005 to fund our operating activities.
Previous report
In order to have sufficient cash to fund our operations in the future, we will need to raise additional equity or debt capital and cannot provide any assurance that we will be successful in doing so. If we are unable to raise sufficient capital to fund our operations, we may need to delay, reduce or eliminate certain of our operations, sell some or all of our assets or merge with another entity.
Previous report
We do not currently have sufficient available liquidity to fund its operations for at least the next 12 months. These conditions and events raise substantial doubt about our ability to continue as a going concern within one year after the date that these audited annual consolidated financial statements are issued.
Previous report
Goodwill
Previous report
The Company accounts for goodwill under FASB ASC 350-30, Intangibles-Goodwill and Other. Goodwill represents the cost of a business acquisition in excess of the fair value of the net assets acquired and liabilities assumed. Goodwill is not amortized and is reviewed for impairment annually, or more frequently if facts and circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the Company performs a quantitative test to identify and measure the amount of goodwill impairment loss. The Company compares the fair value of the reporting unit with its carrying amount. If the carrying amount exceeds fair value, goodwill of the reporting unit is considered impaired, and that excess is recognized as a goodwill impairment loss.
Previous report
During the year ended December 31, 2024, the Company identified a triggering event for goodwill but deemed that the fair value of the reporting unit is greater than its carrying value; therefore, no impairment loss was recognized. During the year ended December 31, 2023, the Company identified a triggering event and as a result recognized an impairment charge of $4,024, which is recorded in goodwill impairment on the consolidated statements of operations and comprehensive loss.
Previous report
Impairment of Long-Lived Assets
Previous report
Long-lived assets are tested for impairment at the lowest level at which there are identifiable operating cash flows. The Company’s long-lived assets consist primarily of leasehold improvements and the right to use lease assets for each of its locations (considered the asset group). The Company monitors the carrying value of long-lived assets for potential impairment and tests the recoverability of such assets whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. If indicators are present, the Company performs a recoverability test by comparing the sum of the estimated undiscounted future cash flows attributable to the asset group in question to its carrying amount. An impairment loss is recognized if it is determined that the long-lived asset group is not recoverable and is calculated based on the excess of the carrying amount of the long-lived asset group over the long-lived asset group’s fair value. The Company estimates the fair value of long-lived assets using the present value income approach. Future cash flows are calculated based on forecasts over the estimated remaining useful life of the asset group, which for each of the Company’s locations, is the remaining term of the operating lease.
Previous report
The estimates used to calculate future cash flows are subjective in nature and involve uncertainties and matters of significant judgments and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimated fair value of each asset group. The Company will calculate the future cash flow using what it believes to be the most predictable of several scenarios. Typically, the changes in assumptions run under different business scenarios would not result in a material change in the assessment of the potential impairment or the impairment amount of
Previous report
a locations long-lived asset group. But if these estimates or related assumptions were to change materially, the Company may be required to record an impairment charge.
Previous report
During the year ended December 31, 2024, the Company identified triggering events and completed an impairment assessment of long-lived assets for impairment and recognized an impairment charge of $1,706 and $2,805, which is recorded in Impairment of long-lived assets and Impairment of operating lease right-of-use assets, respectively, on the consolidated statements of operations and comprehensive loss. During the year ended December 31, 2023, the Company recognized an impairment charge of $1,159 and $926, which is recorded in Impairment of long-lived assets and Impairment of operating lease right-of-use assets, respectively, on the consolidated statements of operations and comprehensive loss.
Reworded paragraphs (16)
Previous wording
On January 14, 2025, we entered into a securities purchase agreement (the “January 2025 Purchase Agreement”) with certain accredited investors thereto, pursuant to which it agreed to sell to such investors (i) an aggregate of 4,000 shares of our newly-designated Series G Convertible Preferred Stock, par value of $0.01 per share and a stated value of $1,000 per share, initially convertible into up to 2,673,797 shares of our common stock at a conversion price of $1.496 per share, (ii) Series A Warrants to acquire up to an aggregate of 2,673,797 shares of common stock at an exercise price of $1.496 per share, and (iii) Series B Warrants to acquire up to an aggregate of 2,673,797 shares of common stock at an exercise price of $1.7952 per share (the “January 2025 Private Placement”), each for a term of five years following the date of issuance. In connection with the January 2025 Private Placement, we also entered into that certain registration rights agreement, dated as of January 14, 2025, with the investors in the January 2025 Private Placement. The January 2025 Private Placement closed on January 14, 2025.
Current wording
On January 14, 2025, the Company entered into a securities purchase agreement with the investors named therein (the “January 2025 Investors”), pursuant to which the Company issued and sold on January 14, 2025, in a private placement (the “January 2025 Private Placement”), (i) an aggregate of 4,000 shares of the Company’s newly-designated Series G Convertible Preferred Stock, par value $0.01 per share and stated value of $1,000 per share (the “Stated Value”) (the “Series G Preferred Stock”), initially convertible into up to 2,673,797 shares of common stock at a conversion price of $1.496 per share (the “Series G Preferred Stock”), (ii) Series A warrants (the “Series A Warrants”) to acquire up to an aggregate of 2,673,797 shares of common stock at an exercise price of $1.496 per share, and (iii) Series B warrants (the “Series B Warrants” and collectively, with the Series A Warrants, the “Warrants”) to acquire up to an aggregate of 2,673,797 shares of common stock at an exercise price of $1.7952 per share. Each share of Series G Preferred Stock and accompanying Warrants were sold together at a combined offering price of $1,000. The January 2025 Private Placement closed on January 14, 2025.
Previous wording
The decrease in total cost of sales during the year ended December 31, 2024, was primarily driven by the closure of XpresSpa locations that were under performing. The largest components in the cost of sales for that segment are labor costs at the location-level. Total cost of sales also includes rent and related occupancy costs, which primarily includes rent based on percentage of sales, as well as other product costs directly associated with the procurement of retail inventory, and other operating costs.
Current wording
During the year ended December 31, 2025, total cost of sales decreased $3,274, or 13%. The decrease in total cost of sales was primarily driven by the closure of the Treat business and 3 XpresSpa locations that were under performing. The largest components in the cost of sales for that segment are labor costs at the location-level. Total cost of sales also includes rent and related occupancy costs, which primarily includes rent based on percentage of sales, as well as other product costs directly associated with the procurement of retail inventory, and other operating costs.
Previous wording
During the year ended December 31, 2024, depreciation and amortization expense decreased $1,127, or 55%, compared to the depreciation and amortization expense recorded during the year ended December 31, 2023. The decrease was primarily due to fewer long-lived assets available for depreciation and amortization in 2024 as compared to 2023 due the impairment of long-lived assets which occurred in the latter half of fiscal year 2023.
Current wording
During the year ended December 31, 2025, depreciation and amortization expense decreased $76, or 8%, compared to the depreciation and amortization expense recorded during the year ended December 31, 2024. The decrease was primarily due to fewer long-lived assets available for depreciation and amortization in 2025 as compared to 2024 due the impairment of long-lived assets which occurred in the latter half of fiscal year 2024.
Previous wording
The following table summarizes impairment charges the years ended December 31, 2024 and 2023, recorded on the consolidated statement of operations and comprehensive loss:
Current wording
The following table summarizes impairment charges for the years ended December 31, 2025 and 2024, recorded on the consolidated statement of operations and comprehensive loss:
Previous wording
The Company identified triggering events and completed an assessment of the Company’s property and equipment, intangible assets and right of use lease assets for impairment as of December 31, 2024 and 2023. As of December 31, 2024, the Company recorded an impairment of property and equipment, intangible assets, and right of use lease assets of approximately $1,706, $5 and $2,805, respectively, as compared to December 31, 2023 of approximately $1,159, $2,768, and $926 impairment of property and equipment, intangible assets, and right of use lease assets, respectively.
Current wording
The Company identified triggering events and completed an assessment of the Company’s property and equipment, intangible assets and right of use lease assets for impairment as of December 31, 2025 and 2024. As of December 31, 2025, the Company recorded an impairment of property and equipment, intangible assets, and right of use lease assets of approximately $2,529, $620 and $1,736, respectively, as compared to December 31, 2024 of approximately $1,706, $5, and $2,805 impairment of property and equipment, intangible assets, and right of use lease assets, respectively.
Previous wording
The Company completed an assessment of goodwill for impairment as of December 31, 2024. The year-over-year decrease is based upon the results of the 2024 impairment assessment whereby the Company identified a triggering event for goodwill but deemed that the reporting unit’s fair value is greater than its carrying value, therefore no impairment for goodwill was recognized as of December 31, 2024. During the year ended December 31, 2023 the Company identified a triggering event, related to the Goodwill associated with XpresTest’s HyperPointe business, and as a result recognized an impairment charge of $4,024.
Current wording
No impairment for goodwill was recognized as of December 31, 2024.
Previous wording
During the year ended December 31, 2024, general and administrative expenses decreased by $415 or 3%, which was primarily due to rightsizing our existing business and optimizing our cost structure. We have significantly reduced operating and overhead expenses while we continue to focus on returning to overall profitability. The decrease in general and administrative expenses were partially offset by an increase in one-time legal fees of approximately $2.1 million related to the defense of the CPC lawsuit.
Current wording
During the year ended December 31, 2025, general and administrative expenses decreased by $4,082 or 20%, which was primarily due to rightsizing our existing business and optimizing our cost structure. We have significantly reduced operating and overhead expenses while we continue to focus on returning to overall profitability.
Previous wording
As of December 31, 2024, the decrease is primarily driven by the decrease in marketable securities balance in 2024 as compared to 2023. Gain on investments is affected by the adjustments to the fair value of our equity investment, which could fluctuate materially from period to period. The fair value of these instruments depends on a variety of assumptions.
Current wording
As of December 31, 2025, the decrease is primarily driven by the decrease in marketable securities balance in 2025 as compared to 2024. Gain on investments is affected by the adjustments to the fair value of our equity investments, which could fluctuate materially from period to period. The fair value of these instruments depends on a variety of assumptions.
Previous wording
As of December 31, 2024, our estimated aggregate total gross NOLs were $150,926 for U.S. federal purposes, expiring 20 years from the respective tax years to which they relate, and $114,321 for U.S. federal purposes with an indefinite life due to new regulations in the Tax Act of 2017. The NOL amounts are presented before Internal Revenue Code, Section 382 limitations (“Section 382”). The Tax Reform Act of 1986 imposed substantial restrictions on the utilization of NOL and tax credits in the event of an ownership change of a corporation. Thus, our ability to utilize all such NOL and credit carryforwards may be limited. The CARES Act was enacted on March 27, 2020, and provides favorable changes to tax laws for businesses impacted by COVID-19. However, we do not anticipate the income tax law changes will materially benefit us.
Current wording
As of December 31, 2025, the Company’s estimated aggregate total NOLs were $150,926 for U.S. federal purposes, expiring 20 years from the respective tax years to which they relate, and $127,912 for U.S. federal purposes with an indefinite life due to new regulations in the TCJA. of 2017. The NOL amounts are presented before Internal Revenue Code, Section 382 limitations ("Section 382"). The Tax Reform Act of 1986 imposed substantial restrictions on the utilization of NOL and tax credits in the event of an ownership change of a corporation. Thus, the Company’s ability to utilize all such NOL and credit carryforwards may be limited. An IRC Section 382 Study has not yet been completed.
Previous wording
During the year ended December 31, 2024, net cash used in operating activities was $11,005 compared to net cash used in operating activities during the year ended December 31, 2023 of $16,074. The decrease in net cash used in operating activities was primarily due the Company’s reduction of operating and overhead expenses such as lower occupancy costs in 2024 as compared to 2023. In addition, there has been higher cash flows from full year operations of the acquired Naples Wax business in 2024 as compared to 2023.
Current wording
During the year ended December 31, 2025, net cash used in operating activities was $8,713 compared to net cash used in operating activities during the year ended December 31, 2024 of $11,005. The decrease in net cash used in operating
Previous wording
During the year ended December 31, 2024, net cash provided by investing activities was $5,895 compared to net cash provided by investing activities during the year ended December 31, 2023 of $5,650. Cash provided in 2024 came primarily from the sale of marketable securities of approximately $7,986. Cash provided in 2023 came primarily from the sale of marketable securities of approximately $9,417.
Current wording
During the year ended December 31, 2025, net cash provided by investing activities was $4,332, compared to net cash provided by investing activities during the year ended December 31, 2024 of $5,895. Cash provided in 2025 came primarily from the sale of marketable securities of approximately $7,391, partially offset by the purchase of $2,964 of property and equipment. Cash provided in 2024 came primarily from the sale of marketable securities of approximately $7,986, partially offset by the purchase of 1,783 of property and equipment.
Previous wording
During the year ended December 31, 2024, net cash provided by financing activities increased by $1,351 primarily due to the net proceeds received from the August 2024 Registered Direct Offering (as defined below).
Current wording
During the year ended December 31, 2025, net cash provided by financing activities increased by $583, primarily reflecting $4,000 of net proceeds from the January 2025 Private Placement, partially offset by financing cash outflows. During the year ended December 31, 2024, net cash provided by financing activities increased by $1,359 primarily due to the net proceeds received from the August 2024 Registered Direct Offering (as defined below).
Previous wording
On August 6, 2024, we entered into a securities purchase agreement with certain institutional and accredited investors, pursuant to which we agreed to sell and issue in a registered direct offering (the “August 2024 Registered Direct Offering”), an aggregate of 652,705 shares (the “August 2024 Shares”) of our common stock. The gross proceeds to us from the August 2024 Registered Direct Offering, prior to deducting estimated fees and expenses of $0.1 million, were approximately $1.4 million. The August 2024 Registered Direct Offering closed on August 8, 2024.
Current wording
On August 6, 2024, we entered into a securities purchase agreement with certain institutional and accredited investors, pursuant to which we agreed to sell and issue in a registered direct offering (the “August 2024 Registered Direct Offering”), an aggregate of 652,705 shares (the “August 2024 Shares”) of our common stock. The gross proceeds to us from the August 2024 Registered Direct Offering, prior to deducting estimated fees and expenses of $100, were approximately $1,400. The August 2024 Registered Direct Offering closed on August 8, 2024.
Previous wording
Intangible assets include customer relationships, trade names, and technology, which were primarily acquired as part of the acquisition of XpresSpa in December 2016, HyperPointe in 2022 and Naples Wax Center in 2023 and were recorded based on the estimated fair value in purchase price allocation. In addition, intangible assets include software and website development costs that were capitalized as part of the Company’s development of a mobile application and website for the Treat brand. The Company accounts for these costs in accordance with ASC 350-40, Internal-Use Software. The intangible assets are amortized over their estimated useful lives, which are periodically evaluated for reasonableness.
Current wording
Intangible assets include customer relationships, trade names, and technology, which were primarily acquired as part of the acquisition of XpresSpa in December 2016 and Naples Wax Center in 2023 and were recorded based on the estimated fair value in purchase price allocation. The intangible assets are amortized over their estimated useful lives, which are periodically evaluated for reasonableness.
Previous wording
The Company’s intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The fair value is then compared to the carrying value and an impairment charge is recognized by the amount in which the carrying value exceeds the fair value of the asset. In assessing the recoverability of the Company’s intangible assets, the Company must make estimates and assumptions regarding future cash flows and other factors to determine the fair value of the respective assets. These estimates and assumptions could have a significant impact on whether an impairment charge is recognized and the magnitude of any such charge. Fair value estimates are made at a specific point in time, based on relevant information. During the year ended December 31, 2024, the Company recorded $5 of intangible impairment loss. During the year ended December 31, 2023, the Company recorded $2,768 of intangible impairment loss.
Current wording
The Company’s intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The fair value is then compared to the carrying value and an impairment charge is recognized by the amount in which the carrying value exceeds the fair value of the asset. In assessing the recoverability of the Company’s intangible assets, the Company must make estimates and assumptions regarding future cash flows and other factors to determine the fair value of the respective assets. These estimates and assumptions could have a significant impact on whether an impairment charge is recognized and the magnitude of any such charge. Fair value estimates are made at a specific point in time, based on relevant information. During the year ended December 31, 2025, the Company recorded $620 of intangible impairment loss. During the year ended December 31, 2024, the Company recorded $5 of intangible impairment loss.
Previous wording
Ongoing conflicts in Russia and Ukraine, and Israel and Palestine, including related sanctions and countermeasures, are difficult to predict, and could adversely impact geopolitical and macroeconomic conditions, the global economy, and contribute to increased market volatility, which may in turn adversely affect our business and operations. We may not be able to raise sufficient additional capital and may tailor our business and operations based on the amount of funding we are able to raise in the future. Nevertheless, there is no assurance that these initiatives will be successful. Additionally, our ability to operate depends upon a large number of airplane travelers with the propensity for health and wellness, and in particular spa treatments and products, spending significant time post-security clearance check points at airports. The number of airline travelers at any given time is volatile and subject to change based on various conditions, including but not limited to market and other conditions, prices of travel fare, and oil and gas prices.
Current wording
Ongoing conflicts in Russia, Ukraine, and the Middle East, including related sanctions and countermeasures and involvement of the United States and other countries, are difficult to predict, and could adversely impact geopolitical and macroeconomic conditions, the global economy, and contribute to increased market volatility, which may in turn adversely affect our business and operations. We may not be able to raise sufficient additional capital and may tailor our business and operations based on the amount of funding we are able to raise in the future. Nevertheless, there is no assurance that these initiatives will be successful. Additionally, our ability to operate depends upon a large number of airplane travelers with the propensity for health and wellness, and in particular spa treatments and products, spending significant time post-security clearance check points at airports. The number of airline travelers at any given time is volatile and subject to change based on various conditions, including but not limited to market and other conditions, prices of travel fare, and oil and gas prices.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
See accompanying notes to the consolidated financial statements.
Current report — wording carried from elsewhere
activities was primarily due the Company’s reduction of operating and overhead expenses such as lower occupancy costs in 2025 as compared to 2024.
Current report — wording carried from elsewhere
On January 14, 2025, we entered into a January 2025 Purchase Agreement with the January 2025 Investors, pursuant to which we sold to the January 2025 Investors: (i) an aggregate of 4,000 shares of Series G Preferred Stock, initially convertible into up to 2,673,797 shares of the Company’s common stock at a conversion price of $1.496 per share, (ii) Series A Warrants to acquire up to an aggregate of 2,673,797 shares of common stock at an exercise price of $1.496 per share, and (iii) Series B Warrants to acquire up to an aggregate of 2,673,797 shares of common stock at an exercise price of $1.7952 per share.