Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Apr. 14, 2023 | Jun. 30, 2022 | |
Document and Entity Information | ||||
Document Type | 10-K | |||
Document Annual Report | true | |||
Document Period End Date | Dec. 31, 2022 | |||
Document Transition Report | false | |||
Entity File Number | 001-34785 | |||
Entity Registrant Name | XWELL, Inc. | |||
Entity Central Index Key | 0001410428 | |||
Entity Incorporation, State or Country Code | DE | |||
Entity Tax Identification Number | 20-4988129 | |||
Entity Address, Address Line One | 254 West 31st Street | |||
Entity Address, Address Line Two | 11th Floor | |||
Entity Address, City or Town | New York | |||
Entity Address, State or Province | NY | |||
Entity Address, Postal Zip Code | 10001 | |||
City Area Code | 212 | |||
Local Phone Number | 750-9595 | |||
Title of 12(b) Security | Common Stock, par value $0.01 per share | |||
Trading Symbol | XWEL | |||
Security Exchange Name | NASDAQ | |||
Entity Voluntary Filers | No | |||
Entity Well-known Seasoned Issuer | No | |||
Entity Current Reporting Status | Yes | |||
Entity Interactive Data Current | Yes | |||
Entity Filer Category | Non-accelerated Filer | |||
Entity Small Business | true | |||
Entity Emerging Growth Company | false | |||
ICFR Auditor Attestation Flag | false | |||
Entity Shell Company | false | |||
Entity Common Stock, Shares Outstanding | 83,418,535 | |||
Amendment Flag | false | |||
Document Fiscal Year Focus | 2022 | |||
Document Fiscal Period Focus | FY | |||
Current Fiscal Year End Date | --12-31 | |||
Auditor Name | Marcum llp | Friedman LLP | ||
Auditor Firm ID | 688 | 711 | ||
Auditor Location | East Hanover, New Jersey | East Hanover, New Jersey | ||
Entity Public Float | $ 65,798,587 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 19,038 | $ 105,506 |
Marketable Securities | 23,153 | |
Accounts receivable | 2,858 | 615 |
Inventory | 1,161 | 1,763 |
Other current assets | 1,122 | 1,095 |
Total current assets | 47,332 | 108,979 |
Restricted cash | 751 | 751 |
Property and equipment, net | 3,666 | 6,658 |
Intangible assets, net | 4,008 | 3,732 |
Operating lease right of use assets, net | 8,276 | 4,336 |
Goodwill | 4,024 | |
Other assets | 2,369 | 2,810 |
Total assets | 70,426 | 127,266 |
Current liabilities | ||
Accounts payable | 2,312 | 5,535 |
Accrued expenses and other current liabilities | 5,719 | 7,423 |
Current portion of operating lease liabilities | 2,586 | 2,736 |
Deferred revenue | 339 | 549 |
Current portion of promissory note, unsecured | 3,584 | |
Total current liabilities | 10,956 | 19,827 |
Long-term liabilities | ||
Operating lease liabilities | 11,521 | 7,504 |
Total liabilities | 22,477 | 27,331 |
Commitments and contingencies (see Note 19) | ||
Equity | ||
Common Stock, $0.01 par value per share, 150,000,000 shares authorized; 83,232,262 and 101,269,349 shares issued and outstanding as of December 31, 2022 and December 31, 2021, respectively | 832 | 1,013 |
Additional paid-in capital | 467,740 | 487,306 |
Accumulated deficit | (428,112) | (395,275) |
Accumulated other comprehensive loss | (534) | (312) |
Total equity attributable to XWELL, Inc. | 39,926 | 92,732 |
Noncontrolling interests | 8,023 | 7,203 |
Total equity | 47,949 | 99,935 |
Total liabilities and equity | $ 70,426 | $ 127,266 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, authorized | 150,000,000 | 150,000,000 |
Common stock, issued | 83,232,262 | 101,269,349 |
Common stock, outstanding | 83,232,262 | 101,269,349 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Revenue, net | ||
Total revenue, net | $ 55,939 | $ 73,729 |
Cost of sales | ||
Labor | 21,437 | 13,421 |
Occupancy | 4,138 | 2,505 |
Products and other operating costs | 18,316 | 25,459 |
Total cost of sales | 43,891 | 41,385 |
Gross Profit | 12,048 | 32,344 |
Depreciation and amortization | 5,429 | 3,201 |
Impairment of long-lived assets | 4,669 | 68 |
Loss on disposal of assets, net | 834 | 22 |
Impairment of operating lease right-of-use assets | 1,110 | 747 |
General and administrative | 31,169 | 24,199 |
Total operating expenses | 43,211 | 28,237 |
Operating (loss) income | (31,163) | 4,107 |
Interest income, net | 384 | 43 |
Foreign exchange loss | (664) | (18) |
Other non-operating expense, net | (1,131) | (1,183) |
(Loss) income before income taxes | (32,574) | 2,949 |
Income tax expense | (55) | (56) |
Net (loss) income | (32,629) | 2,893 |
Net (loss) income attributable to noncontrolling interests | (208) | 456 |
Net (loss) income attributable to XWELL, Inc. | (32,837) | 3,349 |
Net (loss) income | (32,629) | 2,893 |
Other comprehensive loss from operations | (222) | (92) |
Comprehensive (loss) income | $ (32,851) | $ 2,801 |
(Loss) income per share | ||
Basic (loss) income per share (in dollars per share) | $ (0.35) | $ 0.03 |
Diluted (loss) income per share (in dollars per share) | $ (0.35) | $ 0.03 |
Weighted-average number of shares outstanding during the period | ||
Basic (in shares) | 93,655,331 | 104,306,173 |
Diluted (in shares) | 93,655,331 | 105,076,758 |
Managed services fees | ||
Revenue, net | ||
Total revenue, net | $ 16,843 | |
Patient services revenue | ||
Revenue, net | ||
Total revenue, net | $ 32,776 | 50,689 |
Services | ||
Revenue, net | ||
Total revenue, net | 18,883 | 5,420 |
Products | ||
Revenue, net | ||
Total revenue, net | 1,930 | 763 |
Hyperpointe Services | ||
Revenue, net | ||
Total revenue, net | 2,344 | |
Other | ||
Revenue, net | ||
Total revenue, net | $ 6 | $ 14 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands | Common Stock | Additional paid-in capital | Accumulated deficit | Accumulated other comprehensive loss | Total Company equity | Non-controlling interests | Total |
Balance at Dec. 31, 2020 | $ 941 | $ 475,709 | $ (398,624) | $ (220) | $ 77,806 | $ 2,565 | $ 80,371 |
Common Stock, Shares, Outstanding, Beginning Balance at Dec. 31, 2020 | 94,058,853 | ||||||
Warrant exercises, net of costs | $ 113 | 16,972 | 17,085 | 17,085 | |||
Warrant exercises, net of costs (in shares) | 11,273,529 | ||||||
Issuance of Common Stock for services | $ 2 | 377 | 379 | 379 | |||
Issuance of Common Stock for services (in shares) | 232,637 | ||||||
Issuance of restricted stock | $ 4 | (4) | |||||
Issuance of restricted stock (in shares) | 398,068 | ||||||
Stock-based compensation | 2,017 | 2,017 | 839 | 2,856 | |||
Net (loss) income | 3,349 | 3,349 | (456) | 2,893 | |||
Foreign currency translation | (92) | (92) | (92) | ||||
Redemption of certain noncontrolling interests | (502) | (502) | |||||
Consolidation of Variable Interest Entities | 5,109 | 5,109 | |||||
Repurchase and retirement of common stock | $ (47) | (7,778) | (7,825) | (7,825) | |||
Repurchase and retirement of common stock (in shares) | (4,702,072) | ||||||
Distributions to noncontrolling interests | (1,170) | (1,170) | |||||
Contributions from noncontrolling interests | 818 | 818 | |||||
Stock option exercises | 13 | 13 | $ 13 | ||||
Stock option exercises (in shares) | 8,334 | 8,334 | |||||
Balance at Dec. 31, 2021 | $ 1,013 | 487,306 | (395,275) | (312) | 92,732 | 7,203 | $ 99,935 |
Common Stock, Shares, Outstanding, Ending Balance at Dec. 31, 2021 | 101,269,349 | 101,269,349 | |||||
Issuance of Common Stock for acquisition | $ 5 | 901 | 906 | $ 906 | |||
Issuance of Common Stock for acquisition (in shares) | 552,487 | ||||||
Vesting of restricted stock units (shares) | 937,132 | ||||||
Vesting of restricted stock units (Value) | $ 9 | (9) | |||||
Grant of stock options for services | 103 | 103 | 103 | ||||
Value of Shares Withheld to fund payroll taxes | (73) | (73) | (73) | ||||
Stock-based compensation | 3,106 | 3,106 | 664 | 3,770 | |||
Net (loss) income | (32,837) | (32,837) | 208 | (32,629) | |||
Foreign currency translation | (222) | (222) | (121) | (343) | |||
Repurchase and retirement of common stock | $ (195) | (23,594) | (23,789) | (23,789) | |||
Repurchase and retirement of common stock (in shares) | (19,526,706) | ||||||
Distributions to noncontrolling interests | (956) | (956) | |||||
Contributions from noncontrolling interests | 1,025 | $ 1,025 | |||||
Stock option exercises (in shares) | 0 | ||||||
Balance at Dec. 31, 2022 | $ 832 | $ 467,740 | $ (428,112) | $ (534) | $ 39,926 | $ 8,023 | $ 47,949 |
Common Stock, Shares, Outstanding, Ending Balance at Dec. 31, 2022 | 83,232,262 | 83,232,262 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities | ||
Net (loss) income | $ (32,629) | $ 2,893 |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 5,429 | 3,201 |
Impairment of fixed assets | 4,559 | 68 |
Impairment of intangible assets | 110 | 0 |
Impairment of operating lease right-of-use assets | 1,110 | 747 |
Loss on disposal of assets, net | 834 | 22 |
Amortization of operating lease right of use asset | 1,844 | 1,719 |
Issuance of shares of Common Stock for services | 103 | 379 |
Stock-based compensation | 3,770 | 2,856 |
Loss on equity investment | 618 | 1,046 |
Changes in assets and liabilities: | ||
Decrease (increase) in inventory | 592 | (1,106) |
Increase in accounts receivable | (1,835) | (1,124) |
Decrease in deferred revenue | (933) | (365) |
Other assets, current and non-current | (457) | (1,251) |
Other liabilities, current and non-current | (4,056) | (1,211) |
(Decrease) increase in accounts payable | (3,247) | 6,687 |
Net cash (used in) provided by operating activities | (24,188) | 14,561 |
Cash flows from investing activities | ||
Acquisition of property and equipment | (6,464) | (4,282) |
Investment in marketable securities | (23,153) | |
Cash acquired on consolidation of certain Variable Interest Entities | 2,434 | |
Acquisition of HyperPointe net of cash assumed | (4,853) | |
Acquisition of software | (373) | (3,308) |
Net cash used in investing activities | (34,843) | (5,156) |
Cash flows from financing activities | ||
Proceeds from direct offerings of Common Stock and warrants exercises, net of costs | 17,085 | |
Redemption of non-controlling interests | (502) | |
Repurchase of Common Stock | (23,789) | (7,825) |
Contributions from noncontrolling interests | 1,025 | 818 |
Proceeds from stock option exercises | 13 | |
Payments for shares withheld on vesting | (73) | |
Repayment of Paycheck Protection Program | (3,584) | (2,069) |
Distributions to noncontrolling interests | (956) | (1,170) |
Net cash (used in) provided by financing activities | (27,377) | 6,350 |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (60) | 0 |
(Decrease)/ Increase in cash, cash equivalents and restricted cash | (86,468) | 15,755 |
Cash, cash equivalents, and restricted cash at beginning of the period | 106,257 | 90,502 |
Cash, cash equivalents, and restricted cash at end of the period | 19,789 | 106,257 |
Cash paid for | ||
Interest | 10 | 11 |
Income taxes | 55 | |
Non-cash investing and financing transactions | ||
Capital expenditures included in Accounts payable, accrued expenses and other current liabilities | 544 | $ 1,081 |
Issuance of Common Stock on acquisition of gcg Connect, LLC, d/b/a HyperPointe | $ 906 |
General
General | 12 Months Ended |
Dec. 31, 2022 | |
General | |
General | Note 1. General Overview On October 25, 2022, the Company changed its name to XWELL, Inc. (“XWELL” or the “Company”) from XpresSpa Group, Inc. The Company’s common stock, par value In pursuance, the Company amended and restated its certificate of incorporation filed with the Delaware Secretary of State on October 24, 2022 (the “Amended and Restated Certificate”). In addition, prior to filing the Amended and Restated Certificate, the Company filed a Certificate of Elimination (the “Certificate of Elimination”) with respect to its Series A Convertible Preferred Stock, par value $0.01 per share, Series D Convertible Preferred Stock, par value $0.01 per share, Series E Convertible Preferred Stock, par value $0.01 per share, and Series F Convertible Preferred Stock, par value $0.01 per share (collectively, the “Eliminated Preferred Stock”) with the Delaware Secretary of State, becoming effective as of at 11:59 p.m., Eastern Time on October 24, 2022. The Certificate of Elimination (i) eliminated the previous designation of 6,968 shares of Series A Convertible Preferred Stock, none of which were outstanding at the time of filing, (ii) eliminated the previous designation of 500,000 shares of Series D Convertible Preferred Stock, none of which were outstanding at the time of filing, (iii) eliminated the previous designation of 2,397,060 shares of Series E Convertible Preferred Stock, none of which were outstanding at the time of filing, (iv) eliminated the previous designation of 9,000 shares of Series F Convertible Preferred Stock, none of which were outstanding at the time of filing, (v) caused such shares of Eliminated Preferred Stock to resume the status of authorized but unissued shares of preferred stock of the Company and (vi) eliminated all reference to the Eliminated Preferred Stock from the Company’s Certificate of Incorporation filed with the Secretary of State of the State of Delaware and effective prior to the effective time of the Amended and Restated Certificate. XWELL is a global travel health and wellness services holding company. XWELL currently has four reportable operating segments: XpresSpa ® , XpresTest, Treat ™ , and HyperPointe which was acquired in January 2022. XWELL’s subsidiary, XpresSpa Holdings, LLC (“XpresSpa”) has been a global airport retailer of spa services through its XpresSpa spa locations, offering travelers premium spa services, including massage, nail and skin care, as well as spa and travel products. Most of XpresSpa spa locations were closed between March 2020 and September 2021, largely due to the airport traffic remaining at insufficient levels to support operations at a unit level. During the period between March 2020 and September 2021, when the Company was unable to reopen its spa locations for normal operations, the Company in partnership with certain COVID-19 testing partners, successfully launched its XpresCheck Wellness Centers through its XpresTest, Inc. subsidiary (“XpresTest”), offering testing services, also in airports. XpresTest offers COVID-19 and other medical diagnostic testing services to the traveling public, as well as airline, airport and concessionaire employees, and TSA and U.S. Customs and Border Protection agents. XpresTest has entered into managed services agreements (“MSAs”) with professional medical services companies that provide health care services to patients. The medical services companies pay XpresTest a monthly fee to operate in the XpresCheck Wellness Centers. Under the terms of the MSAs, XpresTest provides office space, equipment, supplies, non-licensed staff, and management services in return for a management fee. Effective July 1, 2021, the Company determined that the medical service companies are variable interest entities (“VIEs”) due to their equity holders having sufficient capital at risk; and the Company having a variable interest in and being a primary beneficiary of the medical service companies. During 2022, as countries continued to relax their testing requirements resulting in rapid decline of testing volumes at Company’s XpresCheck locations, the Company closed all but one XpresCheck Wellness Centers. Therefore, as of the date of this report, there is only one operating XpresCheck location operating in one airport. The Treat segment, which is operating through XWELL’s subsidiary Treat, Inc. (“Treat”) is a travel health and wellness brand that provides access to health and wellness services for travelers at on-site centers (currently located in JFK International Airport and in Salt Lake City International Airport). By the third quarter of 2022, it became clear that the Treat business was underperforming and as a result, we began to retool the offerings within the Treat locations by providing additional retail as part of our retail strategy expansion as well as lay the foundation to bring more spa-like services into the Treat location in an attempt to unify our core offering. By the fourth quarter of 2022, the decision was made to close the pre-security Treat location at Phoenix Sky Harbor Airport. As of March 31, 2023, the Treat brand operates 2 locations (JFK International Airport and Salt Lake City International Airport). These remaining Treat locations offer a full retail product offering and a suite of wellness and spa services. The Company’s HyperPointe segment, which the Company acquired in January 2022 ( see Note 10. Acquisition of HyperPointe Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The consolidated financial statements include the accounts of the Company, all entities that are wholly owned by the Company, and all entities in which the Company has a controlling financial interest. All significant intercompany balances and transactions have been eliminated in consolidation. HyperPointe Acquisition In January 2022, the Company announced and closed on the acquisition of gcg Connect, LLC d/b/a HyperPointe. The purchase price in the transaction consisted of $7,121 in cash and $906 in common stock, offset by the settlement of intercompany accounts payable of $770 as well as potential additional earn-out payments of up to $7,500 over a three-year timeframe based upon future performance; these earn-out payments may be satisfied in cash or common stock or a combination thereof subject to various terms and conditions. As of the acquisition date, and as of December 31, 2022, the Company believes that the fair value of the potential earnout payment is $0. HyperPointe currently operates as a new operating segment within XWELL. The chief executive officer of HyperPointe before the Company’s acquisition, continues to serve as the chief executive officer of HyperPointe, as well as serving as the chief executive officer of XpresCheck. See Note 10. Acquisition of HyperPointe Liquidity and Financial Condition As of December 31, 2022, the Company had approximately $19,038 of cash and cash equivalents, $23,153 in marketable securities, and total current assets of approximately $47,332. The Company's total current liabilities balance, which includes accounts payable, deferred revenue, accrued expenses, and operating lease liabilities was approximately $10,956 as of December 31, 2022. The working capital surplus was $36,376 as of December 31, 2022, compared to a working capital surplus of $89,152 as of December 31, 2021. The Company has significantly reduced operating and overhead expenses in the second half of 2022, while it continues to focus on returning to overall profitability. The Company has taken actions to improve its overall cash position and access to liquidity through equity offerings and debt retirements, by exploring valuable strategic partnerships, right sizing its corporate structure and streamlining its operations. |
Accounting and Reporting Polici
Accounting and Reporting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Accounting and Reporting Policies | |
Accounting and Reporting Policies | Note 2. Accounting and Reporting Policies (a) Basis of presentation and principles of consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. The consolidated financial statements include the accounts of the Company, all entities that are wholly owned by the Company, and all entities in which the Company has a controlling financial interest. All significant intercompany balances and transactions have been eliminated in consolidation. (b) Use of estimates The preparation of the accompanying consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses for the periods presented. Actual results may differ from such estimates. Significant items subject to such estimates and assumptions include the Company’s long-lived assets, intangibles assets, the useful lives of the Company’s intangible assets, the valuation of stock-based compensation, deferred tax assets and liabilities, income tax uncertainties, and other contingencies. (c) Translation into United States dollars The Company conducts certain transactions in foreign currencies, which are recorded at the exchange rate as of the transaction date. All exchange gains and losses occurring from the remeasurement of monetary balance sheet items denominated in non-dollar currencies are deemed non-operating income in the consolidated statements of operations and comprehensive loss. During 2022 and 2021, the Company recorded $664 and $18, respectively, in exchange gains and losses occurring from the remeasurement of monetary balance sheet items denominated in non-dollar currencies. Accounts of the foreign subsidiaries of XpresSpa are translated into United States dollars. Assets and liabilities have been translated primarily at year end exchange rates and revenues and expenses have been translated at average monthly rates for the year. The translation adjustments arising from the use of different exchange rates are included as foreign currency translation within the consolidated statements of operations and comprehensive income (loss) and consolidated statements of changes in stockholders’ equity. (d) Cash and cash equivalents The Company maintains cash in checking and money market accounts with financial institutions. The Company has established guidelines relating to diversification and maturities of its investments in order to minimize credit risk and maintain high liquidity of funds. The Company considers all highly liquid investments purchased with an original maturity of three months or less from the time they are acquired to be cash equivalents. The Company had $1,885 of such investments as of December 31, 2022 and $0 as of December 31, 2021. (e) Accounts Receivables Accounts Receivables are stated at their carrying values, net of a reserve for doubtful accounts, and primarily emanate from our contracts with customers. (f) Inventory All inventory is valued at the lower of cost or net realizable value. Cost is determined using a weighted-average cost method. (g) Intangible assets Intangible assets include trade names, customer relationships, and technology, which were primarily acquired as part of the acquisition of XpresSpa in December 2016 and Hyperpointe in 2022, 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. Newly acquired or developed software has an estimated life of approximately 3 years whereas the intangibles obtained as a result of the Hyperpointe acquisition have an estimated life of 5 to 12 years. 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 also the magnitude of any such charge. Fair value estimates are made at a specific point in time, based on relevant information. During the years ended December 31, 2022 and 2021, the Company recognized impairment of $110 and $0, respectively. (h) Property and Equipment Property and equipment are recorded at historical cost and primarily consists of leasehold improvements, furniture and fixtures, and other operating equipment. Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets. Leasehold improvements are depreciated over the lesser of the lease term or economic useful life. Maintenance and repairs are charged to expense, and renovations or improvements that extend the service lives of the Company’s assets are capitalized over the lesser of the extension period or life of the improvement. (i) Impairment of long-lived assets Long-lived assets are tested for impairment at the lowest level at which there are identifiable operating cash flows, which is at the individual airport location for the XpresSpa and XpresCheck businesses. The Company’s long-lived assets consist primarily of leasehold improvements and right to use lease assets for each of its airport locations (considered the asset group). The Company reviews its long-lived assets for recoverability yearly or sooner if events or changes in circumstances indicate that the carrying value of long-lived assets 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 groups fair value. The Company estimates the fair value of long-lived assets using present value income approach. Future cash flow was calculated based on forecasts over the estimated remaining useful life of the asset group, which for each of the Company’s airport locations, is the remaining term of the operating lease. The Company completed an assessment of our property and equipment, operating lease right of use assets and intangible assets for impairment as of December 31, 2022. Based upon the results of the impairment test, the Company recorded an impairment expense related to property and equipment, intangible assets, and operating lease right of use assets of $4,559, $110 and , respectively, during the year ended December 31, 2022, which is included in Impairment of long-lived assets and Impairment of operating lease right-of-use assets In 2021 the Company recorded an impairment expense of approximately $68 and $747 related to property and equipment, and operating lease right of use assets, respectively, which is included in Impairment of long-lived assets and Impairment of operating lease right-of-use assets (j) Leases The right of use asset (“ROU”) on the Company’s consolidated balance sheet represents a lessee's right to use an asset over the life of a lease. Operating lease ROU assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term, plus any lease payments made to the lessor before the lease commencement date, plus any initial direct costs incurred, minus any lease incentives received. The amortization period for the right of use asset is from the lease commencement date to the earlier of the end of the lease term or the end of the useful life of the asset. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has elected to exclude all short-term leases (i.e, leases with term of 12 months or less) from recognition on the balance sheet. The Company’s lease liabilities are determined by calculating the present value of all future lease payments using the rate implicit in the lease if it can be readily determined, or the lessee’s incremental borrowing rate. The Company uses its incremental borrowing rate at the inception of the lease to determine the present value of future lease payments as the rate implicit in its leases could not be readily determined. Certain leases provide for contingent rents that are not measurable at inception. These contingent rents are primarily based on a percentage of sales that are in excess of a predetermined level, an increase based on a change in the consumer price index or fair market value. These amounts are excluded from the calculation of the right of use asset and lease liability under ASC 842. Minimum rent under these leases is included in the determination of rent expense when it is probable that the expense has been incurred and the amount can be reasonably estimated. The Financial Accounting Standards Board (“FASB”) issued a Q&A in March 2020 that focused on the application of lease guidance in ASC 842 for lease concessions related to the effects of COVID-19. The FASB staff has said that entities can elect to not evaluate whether concessions granted by lessors related to COVID-19 are lease modifications. Entities that make this election can then apply the lease modification guidance in ASC 842 or account for the concession as if it were contemplated as part of the existing contract. The Company has elected to not treat the concessions as lease modifications and will instead account for the lease concessions as if they were contemplated as part of the existing leases. The Company has recorded negative variable lease expense and adjusted lease liabilities at the point in which the rent concession has become accruable. (k) Restricted cash Restricted cash, which is listed as a separate line item in the consolidated balance sheets, represents balances at financial institutions to secure bonds and letters of credit as required by the Company’s various lease agreements. (l) Equity investments Equity investments are carried at fair value with the changes in fair value recorded in the consolidated statement of operations and other comprehensive income (loss) in accordance with ASU 2016-01. The Company will perform a qualitative assessment on an annual basis and recognize impairment if there are sufficient indicators that the fair value of the investment is less than the carrying value. (m) Revenue recognition XpresSpa The Company recognizes revenue from the sale of XpresSpa products and services when the services are rendered at XpresSpa stores and from the sale of products at the time products are purchased at the Company’s stores or online usually by credit card, net of discounts and applicable sales taxes. Accordingly, the Company recognizes revenue for the Company’s single performance obligation related to both in-store and online sales at the point at which the service has been performed or the control of the merchandise has passed to the customer. Revenues from the XpresSpa retail and e-commerce businesses are recorded at the time goods are shipped. The Company has also entered into collaborative agreements with marketing partners whereby it sells certain of its partners’ products in the Company’s XpresSpa spas. The Company acts as an agent for revenue recognition purposes and therefore records revenue net of the revenue share payable to the partners. Upon receipt of the non-recurring, non-refundable initial collaboration fee, management records a deferred revenue liability and recognizes revenue on a straight-line basis over the life of the collaboration agreement. XpresCheck Through its XpresCheck Wellness Centers and under the terms of the Managed Services Agreement (“MSA”) with PLLCs that in turn contract with physicians and Nurse Practitioners, the Company offers testing services to airline employees, contractors, concessionaire employees, TSA officers and U.S. Customs and Border Protection agents, as well as the traveling public. The Company has entered into MSAs with PLLCs that provide healthcare services to patients. Under the terms of the MSAs which may be modified for commercial reasonableness and fair market value, XpresTest provides office space, equipment, supplies, non-licensed staff, and management services to be used for the purpose of COVID-19 and other medical diagnostic testing in return for a management fee which was deemed a performance obligation for recognizing revenue prior to July 1, 2021. However, as a result of uncertainties around the cash flows of the XpresCheck Wellness Centers, the Company concluded in 2020 that the collectability criteria to qualify as a contract under ASC 606 was not met, and therefore, revenue associated with the monthly management fee would not be recognized until a subsequent reassessment resulted in the MSAs meeting the collectability criteria. XpresTest recognized revenue of $16,843 (including a cumulative catch-up adjustment of $3,186) Effective, July 1, 2021 (see Note 4), the Company determined that the PLLCs are variable interest entities due to its equity holder having insufficient capital at risk, and the Company having a variable interest in the PLLCs. In pursuance, the total revenue of $50,689 for the PLLCs for the six months period ended December 31, 2021 were designated as revenue for the company. The performance obligation for this revenue was the PLLCs administering COVID-19 tests to airline employees, contractors, concessionaire employees, TSA officers and U.S. Customs and Border Protection agents, as well as the traveling public, with revenue being recognized at the point in time at which the service is performed. During 2021, XpresCheck initiated a $2,001, eight-week pilot program with the Centers for Disease Control and Prevention (CDC) in collaboration with Concentric by Ginkgo. Under this program, XpresCheck is conducting biosurveillance monitoring at four major U.S. airports (JFK International Airport, Newark Liberty International Airport, San Francisco International Airport, and Hartsfield-Jackson Atlanta International Airport) aimed at identifying existing and new SARS-CoV-2 variants. On January 31, 2022, the Company announced the extension of the program, bringing the total contract to $5,534. Approximately $4,166 and $1,368 of the full $5,534 amount was recognized during 2022 and 2021, respectively. During the third quarter of 2022, XpresTest, in partnership with Ginkgo Bioworks in continuation of their support to the CDC’s traveler-based SARS-CoV-2 genomic surveillance program were awarded a new contract. The partnership is expected to support public health and biosecurity services totaling approximately $16,000, with an overall potential to exceed $61,000 based on CDC program options and public health priorities. As COVID-19 sub-variants and other biological threats continue to emerge, the partners plan to expand the program footprint and incorporate innovative modalities and offerings, such as monitoring of wastewater from aircraft lavatories. The current contract with Ginkgo Bioworks related to the above partnership contains fixed pricing for which we are entitled to $6,761 for the sample collection (passenger and aircraft wastewater) and $570 for the traveler enrollment initiatives, which represents the amount of consideration that we are entitled. We recognize revenue over time for both sample collection performance obligations, using the input method based on time elapsed to measure progress towards satisfying each of the performance obligations. We recognize revenue ratably (straight line basis) over the term of the contract (one year). We will recognize revenue over time for the traveler enrollment initiative performance obligation based on the amount for which we have the right to invoice. We recorded $2,617 in revenue during 2022 related to sample collection performance obligations because the Company’s efforts towards satisfying each of the performance obligations are expended evenly throughout the period of performance. HyperPointe Our HyperPointe segment which we acquired in January 2022 ( see Note 10 Acquisition of HyperPointe) satisfied over time with revenue recognized ratably over the contract term. Advanced services are distinct performance obligations that are satisfied over time with revenue recognized as services are delivered. Revenue billed in advance are treated as deferred revenue which was $322 as of December 31, 2022. The Company excludes all sales taxes assessed to our customers from revenue. Sales taxes assessed on revenues are included in Accrued expenses and other current liabilities (n) Gift cards and customer rewards program XpresSpa offers no-fee, non-expiring gift cards to its customers. No revenue is recognized upon issuance of a gift card and a liability is established for the gift card’s cash value. The liability is relieved, and revenue is recognized upon redemption by the customer. As the gift cards have no expiration date, there is no provision for reduction in the value of unused card balances. In addition, XpresSpa maintains a rewards program in which customers earn loyalty points, which can be redeemed for future services. Loyalty points are rewarded upon joining the loyalty program, for customer birthdays, and based upon customer spending. When a customer redeems loyalty points, the Company recognizes revenue for the redeemed cash value and reduces the related loyalty program liability. On June 1, 2018, the Company adopted a formal expiration policy whereby any loyalty members with inactivity for an 18-month period will forfeit any unused loyalty rewards. Upon closure of the spa locations in March 2020, the Company temporarily suspended the expiration policy. The costs associated with gift cards and reward points are accrued as the rewards are earned by the cardholder and are included in Accrued expenses and other current liabilities (o) Segment reporting ASC 280, Segment Reporting There are currently no intersegment revenues. Asset information by operating segment is presented below since the chief operating decision maker reviews this information by segment. The reporting segments follow the same accounting policies used in the preparation of the Company’s audited consolidated financial statements. (p) Pre-opening costs Pre-opening and start-up activity costs, which include rent and occupancy, supplies, advertising, and other direct expenses incurred prior to the opening of a new store, are expensed in the period in which they are incurred. (q) Cost of sales Cost of sales consists of spa and clinic operating costs. These costs include all costs that are directly attributable to the location’s operations and include: ● payroll and related benefits for the location’s operations and management; ● rent, percentage rent and occupancy costs; ● the cost of merchandise and testing supplies; ● freight, shipping and handling costs; ● production costs; ● inventory shortage and valuation adjustments; and ● costs associated with sourcing operations. (r) Stock-based compensation Stock-based compensation is recognized as an expense in the consolidated statements of operations and comprehensive loss and such cost is measured at the grant-date fair value of the equity-settled award. The fair value of stock options is estimated as of the date of grant using the Black-Scholes-Merton (“Black-Scholes”) option-pricing model. The fair value of Restricted Stock Units (“RSUs”) is calculated as of the date of grant using the grant date closing share price multiplied by the number of RSUs granted. The expense is recognized on a straight-line basis, over the requisite service period. The Company uses the simplified method to estimate the expected term of options due to insufficient history and high turnover in the past. Expected volatility is estimated based on a weighted average historical volatility of the Company. The risk-free rate for the expected term of the option is based on the United States Treasury yield curve as of the date of grant. The Company recognizes forfeitures as they occur. The Company issues new stock to deliver shares under its Equity Plan. (s) Income taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not more likely than not to be realized. Tax benefits related to excess deductions on stock-based compensation arrangements are recognized when they reduce taxes payable. In assessing the need for a valuation allowance, the Company looks at cumulative losses in recent years, estimates of future taxable earnings, feasibility of tax planning strategies, the ability to realize tax benefit carryforwards, and other relevant information. Valuation allowances related to deferred tax assets can be impacted by changes to tax laws, changes to statutory tax rates and future taxable earnings. Ultimately, the actual tax benefits to be realized will be based upon future taxable earnings levels, which are very difficult to predict. In the event that actual results differ from these estimates in future periods, the Company will be required to adjust the valuation allowance. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company had no uncertain tax positions as of December 31, 2022 and 2021. (t) Noncontrolling interests Noncontrolling interests represent the noncontrolling holders’ percentage share of earnings or losses from; i) the subsidiaries, in which the Company holds a majority, but less than 100%, ownership interest, ii) Variable Interest Entities, where the Company is a primary beneficiary (See sub note (w) below, and the results of which are included in the Company’s consolidated statements of operations and comprehensive income (loss). Net loss attributable to noncontrolling interests represents the proportionate share of the noncontrolling holders’ ownership in certain subsidiaries of XpresSpa and of XpresTest. (u) Net income/(loss) per common share Basic net income (loss) per share is computed by dividing the net income (loss) attributable to common shareholders for the period by the weighted-average number of shares of Common Stock outstanding during the period. Diluted net income (loss) per share is computed by dividing the net loss attributable to the Company for the period by the weighted-average number of shares of Common Stock plus dilutive potential Common Stock considered outstanding during the period. (v) Commitments and contingencies Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Legal costs expected to be incurred in connection with a loss contingency are expensed as incurred. (w) Variable Interest Entities The Company evaluates its ownership, contractual, pecuniary, and other interests in entities to determine if it has any variable interest in a variable interest entity (“VIE”). These evaluations are complex and involve judgment. If the Company determines that an entity in which it holds a contractual or ownership interest is a VIE and that the Company is the primary beneficiary, the Company consolidates such entity in its consolidated financial statements. The primary beneficiary of a VIE is the party that meets both of the following criteria: (i) has the power to make decisions that most significantly affect the economic performance of the VIE; and (ii) has the obligation to absorb losses or the right to receive benefits that in either case could potentially be significant to the VIE. Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change. Changes in consolidation status are applied prospectively. (x) Business Combinations The Company uses the provisions of ASC Topic 805, Business Combinations (“ASC 805”) in the accounting for acquisitions of businesses. ASC 805 requires the Company to use the acquisition method of accounting by recognizing the identifiable tangible and intangible assets acquired and liabilities assumed, and any non-controlling interest in the acquired business, measured at their acquisition date fair values. Goodwill as of the acquisition date is measured as the excess of consideration transferred over the aforementioned amounts. While the Company uses its best estimates and assumptions to accurately apply preliminary values to assets acquired and liabilities assumed at the acquisition date, these estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the values of the assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded in the consolidated statements of operations. Accounting for business combinations requires management to make significant estimates and assumptions, especially at the acquisition date, including estimates for intangible assets. Although the Company believes the assumptions and estimates that have been made are reasonable and appropriate, they are based in part on historical experience and information obtained from the acquired companies and are inherently uncertain. Critical estimates in valuing certain of the intangible assets the Company has acquired include future expected cash flows, and discount rates. (y) Goodwill Goodwill represents the cost of a business acquisition in excess of the fair value of the net assets acquired. 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, including goodwill. 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. (z) Advertising Costs Advertising costs are expensed as incurred. Advertising expenses amounted to approximately $4,645 and $2,817 for the years ended December 31, 2022 and 2021, respectively. (aa) Fair value measurements The Company measures fair value in accordance with ASC 820-10, Fair Value Measurements and Disclosures. ASC 820-10 clarifies that fair value is an exit price, representing the amount that would be received by selling an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, ASC 820-10 establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 Level 2 Level 3 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. (bb) Reclassification Certain balances in the 2021 consolidated financial statements have been reclassified to conform to the presentation in the 2022 consolidated financial statements, primarily the separate classification and presentation of accounts payable, gross profits, impairments and loss on disposal of assets. Such reclassifications did not have a material impact on the consolidated financial statements. (cc) Recently adopted accounting pronouncements Accounting Standards Update No. 2020-06—Debt--Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) Issued in August 2020, this update is intended to reduce the unnecessary complexity of the current guidance thus resulting in more accurate accounting for convertible instruments and consistent treatment from one entity to the next. Under current GAAP, there are five accounting models for convertible debt instruments. Except for the traditional convertible debt model that recognizes a convertible debt instrument as a single debt instrument, the other four models, with their different measurement guidance, require that a convertible debt instrument be separated (using different separation approaches) into a debt component and an equity or a derivative component. Convertible preferred stock also is required to be assessed under similar models. The Financial Accounting Standard Board (“FASB”) decided to simplify the accounting for convertible instruments by removing certain separation models currently included in other accounting guidance that were being applied to current accounting for convertible instruments. Under the amendments in this update, an embedded conversion feature no longer needs to be separated from the host contract for convertible instruments with conversion features that are not required to be accounted for as derivatives. Consequen |
Net earnings_(loss) per Share o
Net earnings/(loss) per Share of Common Stock | 12 Months Ended |
Dec. 31, 2022 | |
Net earnings/(loss) per Share of Common Stock | |
Net earnings/(loss) per Share of Common Stock | Note 3. Net earnings/(loss) per Share of Common Stock The table below presents the computation of basic and diluted (losses)/net earnings per common share: Year ended December 31, 2022 2021 Basic numerator: Net (loss) income attributable to XWELL, Inc. $ (32,837) $ 3,349 Net (loss) income attributable to common shareholders $ (32,837) $ 3,349 Basic denominator: Basic weighted average shares outstanding 93,655,331 104,306,173 Basic (loss) earnings per share $ (0.35) $ 0.03 Diluted numerator: (Loss) earnings attributable to common shareholders $ (32,837) $ 3,349 Diluted denominator: Diluted weighted average shares outstanding 93,655,331 105,076,758 Diluted (loss) earnings per share $ (0.35) $ 0.03 Net (loss) income per share data presented above excludes from the calculation of diluted net (loss) income, the following potentially dilutive securities, having an anti-dilutive impact, in case of net loss Both vested and unvested options to purchase an equal number of shares of Common Stock 4,830,029 2,614,766 Unvested RSUs to issue an equal number of shares of Common Stock 281,250 521,049 Warrants to purchase an equal number of shares of Common Stock 1,172,088 37,338,164 Total number of potentially dilutive securities excluded from the calculation of earnings/(loss) per share attributable to common shareholders 6,283,367 40,473,979 |
Variable Interest Entities
Variable Interest Entities | 12 Months Ended |
Dec. 31, 2022 | |
Variable Interest Entities | |
Variable Interest Entities | Note 4. Variable Interest Entities Through its XpresCheck Wellness Centers, the Company provides services pursuant to contracts with PLLCs which in turn contracts with physicians and other medical professional providers to render COVID-19 and other medical diagnostic testing services to airline employees, contractors, concessionaire employees, TSA officers and U.S. Customs and Border Protection agents, and the traveling public. The PLLCs collectively represent the Company’s affiliated medical group. The PLLCs were designed and structured to comply with the relevant laws and regulations governing professional medical practice, which generally prohibits the practice of medicine by lay persons or entities. All of the issued and outstanding equity interests of the PLLCs are owned by a licensed medical professional nominated by the Company (the “Nominee Shareholder”). Upon formation of the PLLCs, and initial issuance of equity interests, the Nominee Shareholder contributes a nominal amount of capital in exchange for their interest in the PLLC. The Company then executes with each PLLC a MSA, which provide for various administrative services, management services and day-to-day activities of the practice to be rendered by the Company through its XpresCheck Wellness Centers. The Company also has exclusive responsibility for the provision of all nonmedical services including contracting with customers who access the PLLCs for a medical visit, handling all financial transactions and day-to-day operations of each PLLC, overseeing the establishment of COVID-19 and other medical diagnostic testing services policies, and making recommendations to the PLLC in establishing the guidelines for the employment and compensation of the physicians and other employees of the PLLCs. Until June 30, 2021, MSA Fees were commensurate with the expected level of activity required to be billed by XpresCheck Wellness Centers. Therefore, these PLLCs were assessed not to be variable interest entities prior to July 1, 2021. Effective July 1, 2021, contractual arrangements between the company, the company’s affiliated medical group and nominated shareholder were modified in a manner that changes the characteristics or adequacy of the nominee shareholders equity investment at risk and residual returns. Therefore, due to reassessment triggered by the development on July 1, 2021, the Company determined that the PLLCs are now variable interest entities. Notwithstanding their legal form of ownership of equity interests in the PLLC, the primary beneficiary of the affiliated medical group is the Company as it meets both of the following criteria: (i) has the power to make decisions that most significantly affect the economic performance of the affiliated medical group; and (ii) has the obligation to absorb losses or the right to receive benefits that in either case could potentially be significant to the affiliated medical group. The Company consolidated the PLLCs under the VIE model since the Company has the power to direct activities that most significantly impact the PLLCs economic performance and the right to receive benefits or the obligation to absorb losses that could potentially be significant to the PLLCs. The aggregate carrying value of total assets and total liabilities included on the consolidated balance sheets for the PLLCs after elimination of intercompany transactions were $275, included in Cash and Cash Equivalents, and $146, included in Accrued expenses and other current liabilities The aggregate carrying value of total assets and total liabilities included on the consolidated balance sheets for the PLLCs after elimination of intercompany transactions were $3,033 , included in Cash and Cash Equivalents, and $683 , included in Accrued expenses and other current liabilities , respectively, as of December 31, 2021. |
Cash, Cash Equivalents, and Res
Cash, Cash Equivalents, and Restricted Cash | 12 Months Ended |
Dec. 31, 2022 | |
Cash, Cash Equivalents, and Restricted Cash | |
Cash, Cash Equivalents, and Restricted Cash | Note 5. Cash, Cash Equivalents, and Restricted Cash December 31, 2022 December 31, 2021 Cash denominated in United States dollars $ 16,344 $ 102,560 Cash denominated in currency other than United States dollars 2,562 2,133 Restricted cash 751 751 Credit and debit card receivables 132 813 Total cash, cash equivalents and restricted cash $ 19,789 $ 106,257 The Company places its cash and temporary cash investments with credit quality institutions. At times, such cash denominated in United States dollars may be in excess of the Federal Deposit Insurance Corporation (“FDIC”) insurance limit. At December 31, 2022 and 2021, deposits in excess of FDIC limits were $16,069 and $103,339. As of December 31, 2022 and 2021, the Company held cash balances in overseas accounts, totaling $2,562 and $2,113, respectively, which are not insured by the FDIC. If the Company were to distribute the amounts held overseas, the Company would need to follow an approval and distribution process as defined in its operating and partnership agreements, which may delay and/or reduce the availability of that cash to the Company. |
Other Current Assets
Other Current Assets | 12 Months Ended |
Dec. 31, 2022 | |
Other Current Assets | |
Other Current Assets | Note 6. Other Current Assets As of December 31, 2022, and 2021, the Company’s other current assets were comprised of the following: December 31, 2022 December 31, 2021 Prepaid expenses $ 1,074 $ 1,047 Other 48 48 Total other current assets $ 1,122 $ 1,095 Prepaid expenses are predominantly comprised of financed and prepaid insurance policies which have terms of one year or less. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property and Equipment | |
Property and Equipment | Note 7. Property and Equipment Property and equipment are comprised of three categories: leasehold improvements, furniture and fixtures, and other operating equipment as of December 31, 2022 and 2021 as follows: December 31, 2022 2021 Useful Life Leasehold improvements $ 8,692 $ 11,225 Average 5-8 years Furniture and fixtures 1,214 1,146 3-4 years Other operating equipment 760 1,027 Maximum 5 years 10,666 13,398 Accumulated depreciation (7,000) (6,740) Total property and equipment, net $ 3,666 $ 6,658 Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are depreciated over the shorter of remaining lease term or economic useful life (which is on average 5-8 years). The Company performed assessments of its property and equipment for impairment for the years ended December 31, 2022 and 2021 and based upon the results of the impairment tests, the Company recorded impairment expenses of approximately $4,559 and $68, respectively, which is included in “Impairment of long-lived assets” During the years ended December 31, 2022 and 2021, the Company recorded $3,663 and $2,754, respectively, of depreciation expense. |
Other Assets
Other Assets | 12 Months Ended |
Dec. 31, 2022 | |
Other Assets | |
Other Assets | Note 8. Other Assets Other assets in the consolidated balance sheets are comprised of the following as of December 31, 2022 and 2021: December 31, 2022 December 31, 2021 Equity investments $ 104 $ 722 Lease deposits 1,973 2,030 Other 292 58 Other assets $ 2,369 $ 2,810 As of December 31, 2022 and 2021, the equity investment in Route1 had a readily determinable fair value of $104 and $722, respectively. The Company recorded an unrealized loss of $618 in 2022 and an unrealized loss of $1,046 in 2021, in connection with the remeasurement of the shares of our common stock of Route 1 it obtained in the 2018 sale of Group Mobile to Route 1. The loss/gain is included in Other non-operating income (expense), net Also included in “Other assets” |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Intangible Assets | |
Intangible Assets | Note 9. Intangible Assets The following table provides information regarding the Company’s intangible assets, which consist of the following: December 31, 2022 December 31, 2021 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Trade names $ 302 $ (24) $ 278 $ 1,339 $ (1,118) $ 221 Customer relationships 1,510 (542) 968 — — — Software 4,485 (1,761) 2,724 3,886 (484) 3,402 Licenses 55 (17) 38 116 (7) 109 Total intangible assets $ 6,352 $ (2,344) $ 4,008 $ 5,341 $ (1,609) $ 3,732 The Company’s trade name relates to the value of the Hyperpointe trade name, software relates to certain capitalized third-party costs related to a new website and a point-of-sale system; and licenses relates to certain capitalized costs of foreign acquisition. In the year ended December 31, 2022, the Company recorded an impairment of $110 related to Software which is included in “ Impairment of long-lived assets The Company’s intangible assets are amortized over their expected useful lives, which is six years for trade names and five Estimated amortization expense for the Company’s intangible assets at December 31, 2022 is as follows: Calendar Years ending December 31, Amount 2023 $ 1,503 2024 1,462 2025 411 2026 317 2027 77 Thereafter 238 Total $ 4,008 |
Acquisition of HyperPointe
Acquisition of HyperPointe | 12 Months Ended |
Dec. 31, 2022 | |
Acquisition of HyperPointe | |
Acquisition of HyperPointe | Note 10. Acquisition of HyperPointe On January 14, 2022, the Company acquired all of the equity interests in gcg Connect, LLC, d/b/a HyperPointe, a New Jersey limited liability company (“HyperPointe”), for an aggregate initial purchase price of approximately $7,257, which consisted of (i) XWELL also agreed pursuant to an earnout provision to issue up to an additional $7,500 in cash or stock if certain earnout performance targets are met during an earnout period ending on the third anniversary of the date of the acquisition agreement. For purposes of the earnout, the Common Stock will also be valued on a per share basis. The earnout payments may be satisfied in (i) cash, (ii) shares of Common Stock (priced at $1.81 ), or (iii) any combination thereof, at the election of the equity owners of HyperPointe, provided that in the event (and to the extent) XWELL does not have sufficient authorized shares of Common Stock that are unissued and not duly reserved for issuance upon options, warrants or other convertible securities, then XWELL shall be permitted to settle any earnout payments in cash. As a result, XWELL may issue up to an additional 4,143,647 shares of Common Stock; however, the actual number of shares that will be issued under the earnout, if any, will depend on (i) the extent of fulfillment of the earnout performance targets at the time of calculation of the earnout and (ii) the elections and conditions described in the previous sentence XWELL g XWELL The employee received stock options to purchase 1,000,000 shares of XWELL One three XWELL The Company has recognized the assets and liabilities based on the acquisition date fair values. Based on an assessment of probability, the Company concluded that the acquisition did not result in the creation of any contingent consideration as of the Acquisition date and as of December 31, 2022. Determination of the fair values of the acquired assets and assumed liabilities (and the related determination of estimated lives of depreciable tangible and identifiable intangible assets) requires significant judgment. The fair value of intangible assets other than Goodwill was determined primarily using income approaches. This included estimated multi-period excess earnings valuation method for Customer relationships and the relief-from-royalty valuation for the tradename. The following table sets forth the significant assumptions utilized when valuing the Customer Relationships: Customer relationships Attrition Rate 15.00 % Existing Customer Growth 3.00 % Business Development Expense for New Customers 0.50 % Customer relationships Discount Rate 26.00 % Estimated Remaining Economic Life (Years) (approx.) 5 yrs The following table sets forth the significant assumptions utilized when valuing the Tradename: % of Revenue Attributable to Trade Name 100 % Royalty Rate 1.00 % Trade Name Discount Rate 24.50 % Remaining Economic Life (Years) 12 yrs The adjustments set forth in the following consolidated Balance Sheet reflect the effect of the consummation of the acquisition: Consideration paid $ 7,257 Fair value of assets acquired and liabilities assumed Cash and cash equivalents $ 2,269 Accounts receivable 346 Unbilled Receivables 56 Prepaid expenses and other current assets 19 Other long-term assets 16 Property and equipment 68 Customer relationships 1,198 Trade name 302 Software 335 Accounts payable (653) Deferred revenue (723) 3,233 Goodwill $ 4,024 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases | |
Leases | Note 11. Leases The Company leases spa and clinic locations at various domestic and international airports. Additionally, the Company leases its corporate office in New York City. Certain leases entered into by the Company are accounted for in accordance with ASC 842. The Company determines if an arrangement is a lease at inception and if it qualifies under ASC 842. The Company’s lease arrangements generally contain fixed payments throughout the term of the lease and most also contain a variable component to determine the lease obligation where a certain percentage of sales is used to calculate the lease payments. The Company enters into leases that expire, are amended and extended, or are extended on a month-to-month basis. Leases are not included in the calculation of the total lease liability and the right of use asset when they are month-to-month. All qualifying leases held by the Company are classified as operating leases. Operating lease assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The Company records its operating lease assets and liabilities based on required guaranteed payments under each lease agreement. The Company uses its incremental borrowing rate, which approximates the rate at which the Company can borrow funds on a secured basis, using the information available at commencement date of the lease in determining the present value of guaranteed lease payments. The interest rate implicit in the lease is generally not determinable in transactions where a company is the lessee. The Company reviews all of its existing lease agreements to determine whether there were any modifications to lease agreements and to assess if any agreements should be accounted for pursuant to the guidance in ASC 842. The following is a summary of the activity in the Company’s current and long-term operating lease liabilities for the year ended December 31, 2022 and 2021: Year ended December 31, 2022 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ (4,092) $ (4,230) Leased assets obtained in exchange for new and modified operating lease liabilities $ 6,891 $ 3,646 Leased assets surrendered in exchange for termination of operating lease liabilities $ — $ 9 As of December 31, 2022, future minimum operating leases commitments are as follows: Calendar Years ending December 31, Amount 2023 $ 3,479 2024 3,153 2025 2,676 2026 1,618 2027 1,495 Thereafter 4,389 Total future lease payments 16,810 Less: interest expense at incremental borrowing rate (2,703) Net present value of lease liabilities $ 14,107 Other assumptions and pertinent information related to the Company’s accounting for operating leases are: Weighted average remaining lease term: 5.98 years Weighted average discount rate used to determine present value of operating lease liability: 7.69 % Variable lease payments calculated monthly as a percentage of a product and services revenue were $1,392 and $576 for the years ended December 31, 2022 and 2021, respectively. Rent expense for operating leases for the years ended December 31, 2022 and 2021 were $3,917 and $2,069, respectively. The Company performed assessments of its right of use lease assets for impairment for the years ended December 31, 2022 and 2021. Based upon the results of the impairment tests, the Company recorded impairment expenses of approximately $1,110 and $747 which is included in Impairment of operating lease right-of-use assets on the consolidated statement of operations and comprehensive income (loss) for the years ended December 31, 2022 and 2021, respectively. |
Long-term Notes and Convertible
Long-term Notes and Convertible Notes | 12 Months Ended |
Dec. 31, 2022 | |
Long-term Notes and Convertible Notes | |
Long-term Notes and Convertible Notes | Note 12. Long-term Notes and Convertible Notes Paycheck Protection Program On May 1, 2020, the Company entered into a U.S. Small Business Administration (“SBA”) Paycheck Protection Program (“the PPP”) promissory note in the principal amount of $5,653 payable to Bank of America, NA (“Bank of America”) evidencing a PPP loan (the “PPP Loan”). The PPP Loan bore interest at a rate of 1% per annum. No payments were due on the PPP Loan during a six-month deferral period commencing on May 2, 2020. Commencing one month after the expiration of the deferral period and continuing on the same day of each month thereafter until the maturity date of the PPP Loan, the Company was obligated to make monthly payments of principal and interest, each in such equal amount required to fully amortize the principal amount outstanding on the PPP Loan by the maturity date, which was May 2, 2022. The PPP loan balance was $3,584 as of December 31, 2021. The PPP loan was paid off in full on the maturity date of May 2, 2022. |
Stockholders' Equity and Warran
Stockholders' Equity and Warrants | 12 Months Ended |
Dec. 31, 2022 | |
Stockholders' Equity and Warrants | |
Stockholders' Equity and Warrants | Note 13. Stockholders’ Equity and Warrants Share Repurchase Program During 2021, the Company executed on its share repurchase program, repurchasing and retiring 4,702,072 shares at an average cost of $1.66 per share, for a total of $7,825. During 2022, the Company continued to execute on its share repurchase program, repurchasing and retiring 19,526,706 shares at an average cost of $1.22 per share, for a total of $23,789 On August 16, 2022, the Inflation Reduction Act of 2022 (the “IR Act”) was signed into federal law. The IR Act provides for, among other things, a new U.S. federal 1% Warrants The following table represents the activity related to the Company’s warrants during the year ended December 31, 2022: Weighted average Exercise No. of warrant exercise price price range December 31, 2021 37,817,694 $ 2.99 $ 0.525 - 6.566 Granted — $ — $ Exercised — $ — $ Expired (36,645,606) $ 3.02 $ 1.7 - 6.566 December 31, 2022 1,172,088 $ 2.00 $ 1.7 - 2.125 The Company’s outstanding equity warrants as of December 31, 2022 consist of the following: Remaining contractual No. outstanding Exercise price life Expiration Date January 2021 Placement Agent Warrants 510,588 $ 2.125 0.08 years January 28, 2023 January 2021 Placement Agent Tail Fee 35,000 $ 1.7 0.08 years January 28, 2023 February 2021 Placement Agent Warrants 284,000 $ 2.125 0.12 years February 11, 2023 February 2021 Placement Agent Warrants 48,000 $ 2.125 0.13 years February 16, 2023 February 2021 Placement Agent Tail Fee 248,500 $ 1.7 0.12 years February 11, 2023 February 2021 Placement Agent Tail Fee 42,000 $ 1.7 0.13 years February 16, 2023 December 2021 Placement Agent Tail Fee 4,000 $ 2.125 0.99 years December 27, 2023 1,172,088 During 2021, holders of the Company’s December 2020 Investor Warrants, December 2020 Placement Agent Warrants and December 2020 Placement Agent Tail Fee Warrants exercised a total of 11,273,529 warrants for common shares. The Company received gross proceeds of approximately $19,245. In accordance with the placement agent agreements with H.C. Wainwright & Co., LLC and Palladium, the Company paid cash fees of $2,162 and issued 846,588 warrants to H.C. Wainwright & Co., LLC at an exercise price of $2.125 per share and 325,500 warrants to Palladium at an exercise price of $1.70 per share. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Measurements | |
Fair Value Measurements | Note 14. Fair Value Measurements Fair value is the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. A fair value hierarchy exists, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of inputs that may be used to measure fair value are: Level 1: Level 2: Level 3: The following table presents the placement in the fair value hierarchy of the Company’s assets and liabilities measured at fair value on a recurring and nonrecurring basis as of December 31, 2022 and 2021. Assets and liabilities that are measured at fair value on a nonrecurring basis relate primarily to tangible property and equipment, right-of-use assets, and other intangible assets, which are remeasured when the derived fair value is below carrying value in the consolidated balance sheets. Recoverability is based on estimated undiscounted cash flows or other relevant observable/unobservable measures. For these assets, the Company does not periodically adjust carrying value to fair value except in the event of impairment. If it is determined that impairment has occurred, the carrying value of the asset is reduced to fair value and the difference is included in Impairment of long-lived assets and Impairment of operating lease right-of-use assets Fair value measurement at reporting date using Quoted prices in active markets Significant other Significant for identical observable unobservable Balance assets (Level 1) inputs (Level 2) inputs (Level 3) As of December 31, 2022: Recurring fair value measurements Equity securities: Route1, Inc. $ 104 $ — $ 104 $ — Total equity securities 104 — 104 — Total recurring fair value measurements $ 104 $ — $ 104 $ — Nonrecurring fair value measurements Intangible assets 4,008 — — 4,008 Total nonrecurring fair value measurements $ 4,008 $ — $ — $ 4,008 As of December 31, 2021 Recurring fair value measurements Equity securities: $ 722 $ — $ 722 $ — Total equity securities 722 — 722 — Total recurring fair value measurements $ 722 $ — $ 722 $ — In addition to the above, the Company’s financial instruments as of December 31, 2022 and 2021 consisted of cash and cash equivalents, receivables, accounts payable and debt. The carrying amounts of all the aforementioned financial instruments approximate fair value because of the short-term maturities of these instruments. |
Stock-based Compensation
Stock-based Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Stock-based Compensation | |
Stock-based Compensation | Note 15. Stock-based Compensation The Company has a stock-based compensation plan available to grant stock options and RSUs to the Company’s directors, employees and consultants. In September 2020, the Board of Directors approved a new stock-based compensation plan available to grant stock options, restricted stock and Restricted Stock Units (“RSU’s”) aggregating to 5,000,000 shares of Common Stock, to the Company’s directors, employees and consultants. Shareholder approval of the plan was subsequently obtained on October 28, 2020. On October 4, 2022, shareholders approved the amendment to the Company’s 2020 Equity Incentive Plan to increase the number of shares authorized for issuance under the Plan by 7,500,000 shares of Common Stock to an aggregate of 12,500,000 shares. The Company’s previous Employee, Director and Consultant Equity Incentive Plan (the “2012 Plan”) was terminated upon receipt of shareholder approval of the 2020 Plan. Awards granted under the 2012 Plan remain in effect pursuant to their terms. Generally, stock options are granted with exercise prices equal to the fair market value on the date of grant, vest in four equal quarterly installments, and expire 10 years from the date of grant. RSU’s granted generally vest over a period of one year. In September 2020, XpresTest created a stock-based compensation plan available to grant stock options, restricted stock and RSU’s to the XpresTest’s directors, employees and consultants. Under the XpresTest 2020 Equity Incentive Plan (the “XpresTest Plan”), a maximum of 200 shares of XpresTest common stock may be awarded, which would represent 20% of the total number of shares of common stock of XpresTest as of December 31, 2022. Certain named executive officers, consultants, and directors of the Company are eligible to participate in the XpresTest Plan. The XpresTest Plan RSAs vest upon satisfaction of certain service and performance-based conditions. The fair value of the XpresTest Plan RSAs is determined based on the weighted average of (i) Fair Value of XpresTest under the Indirect Valuation Method developing assumptions for XpresSpa Net Market Cap and XpresSpa standalone Fair Value, and (ii) Direct Valuation Method developing assumptions for XpresTest Representative Forecasted Revenue for 2021 and Peer companies Revenue’s Multiples. The fair value of stock options is estimated as of the date of grant using the Black-Scholes-Merton (“Black-Scholes”) option-pricing model. The Company uses the simplified method to estimate the expected term of options due to insufficient history and high turnover in the past. The following variables were used as inputs in the model: Share price of the Company’s Common Stock on the grant date: $ 0.65 - 1.64 Exercise price: $ 0.65 - 1.64 Expected volatility: 119.41 - 123.45 % Expected dividend yield: 0 % Annual average risk-free rate: 1.62 - 4.14 % Expected term: 6.41 - 6.43 years Total stock-based compensation expense for the years ended December 31, 2022 and 2021 was $3,770 and $2,856, respectively. The following tables summarize information about stock options and RSU activity during the year ended December 31, 2022: RSUs XpresTest RSAs Stock options Weighted Weighted Weighted average average average Exercise No. of grant date No. of grant date No. of exercise price RSUs fair value RSAs fair value options price range Outstanding as of December 31, 2021 600,000 $ 1.63 — $ — 2,826,871 $ 2.57 $ 1.19 - 2,460 Granted 531,250 0.84 15.0 56,890 2,350,338 1.46 0.65 - 1.64 Exercised/Vested (850,000) 1.46 (10.0) 61,550 — — Forfeited — — — — (245,027) 1.55 1.43-3.82 Expired — — — — (102,153) 6.05 1.44-2,232 Outstanding as of December 31, 2022 281,250 $ 0.65 5.0 $ 47,570 4,830,029 $ 2.00 $ 0.65 - 2,460 Exercisable as of December 31, 2022 2,061,259 $ 2.56 $ 1.19 - 2,460 The following tables summarize information about stock options and RSU activity during the year ended December 31, 2021: RSUs XpresTest RSAs Stock options Weighted Weighted Weighted average average average Exercise No. of grant date No. of grant date No. of exercise price RSUs fair value RSAs fair value options price range Outstanding as of December 31, 2020 — $ — 28.75 $ 11,390.35 1,353,888 $ 3.82 $ 1.53 - 2,460.0 Granted 1,349,167 1.58 120.00 5,227.20 1,668,297 1.56 1.19 - 1.61 Exercised/Vested (749,167) 1.54 (148.75) 6,418.40 (8,334) 1.53 Forfeited — — — — (183,230) 1.61 Expired — — — — (3,750) 50.8 NA Outstanding as of December 31, 2021 600,000 $ 1.63 — $ — 2,826,871 $ 2.57 $ 1.19 - 2,460.0 Exercisable as of December 31, 2021 1,024,694 $ 3.81 $ 1.19 - 2,460.0 The weighted average remaining contractual term for options outstanding as of December 31, 2022 and 2021 was 7.83 years and 8.71 years, respectively. As of December 31, 2022, Aggregate Intrinsic Value of Options Outstanding and Vested was $0. As of December 31, 2021, Aggregate Intrinsic Value of Options Outstanding and Vested was $545. Unrecognized stock-based payment cost related to non-vested stock options as of December 31, 2022 and 2021 were $2,506 and $2,088, respectively. Unrecognized stock-based payment cost related to non-vested RSUs as of December 31, 2022 and 2021 were $183 and $978 respectively. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2022 | |
Segment Information | |
Segment Information | Note 16. Segment Information The Company analyzes the results of the Company’s business through the Company’s four reportable segments: XpresSpa, XpresTest, Treat and HyperPointe. The XpresSpa segment provides travelers premium spa services, including massage, nail and skin care, as well as spa and travel products. The XpresTest segment provides diagnostic COVID-19 tests at XpresCheck™ Wellness Centers in airports, to airport employees and to the traveling public. The Treat segment provides access to integrated care which can seamlessly fit into a post-pandemic world and is designed to deliver on-demand access to integrated healthcare through technology and personalized services, positioned for a traveler to access health care, records and real-time information all in one place, as well as book appointments in the Company’s on-site wellness centers as they reopen. HyperPointe, which we acquired in January 2022, provides a broad range of service and support options for our customers, including technical support services and advanced services. The chief operating decision maker evaluates the operating results and performance of the Company’s segments through operating income. Expenses that can be specifically identified with a segment have been included as deductions in determining operating income. Any remaining expenses and other charges are included in Corporate and Other. The Company currently operates in two geographical regions: United States and all other countries, which include Netherlands, Turkiye and United Arab Emirates. The following table represents the geographical revenue, and total long-lived asset information as of and for the years ended December 31, 2022 and 2021. There were no concentrations of geographical revenue and long-lived assets related to any single foreign country that were material to the Company’s consolidated financial statements. Long-lived assets include property and equipment, restricted cash, equity investments, security deposits and right of use lease assets. For the years ended December 31, 2022 2021 Revenue United States $ 52,250 $ 71,114 All other countries 3,689 2,615 Total revenue $ 55,939 $ 73,729 Long-lived assets United States $ 15,084 $ 9,698 All other countries 3,710 4,799 Total long-lived assets $ 18,794 $ 14,497 The Company’s continuing operating segments are defined as components of an enterprise about which separate financial information is available that is regularly evaluated by the enterprise’s CODM in deciding how to allocate resources and in assessing performance. As a result of the Company’s transition to a pure-play health and wellness services company, the Company currently has four reportable operating segments: XpresSpa, XpresTest Treat and HyperPointe. For 2022, c ustomers A, B, and C comprised approximately 55% , 33% , and 10% , respectively of the Companys’ net sales from its Hyperpointe segment. As of December 31, 2022, Customers A and D comprised approximately 55% and 27% , respectively of the Company’s accounts receivable at its Hyperpointe segment. Customer E comprised approximately 10% of the Company’s net sales from its XpresTest segment. Customer F comprised approximately 99% of the Company’s accounts receivable at its XpresTest segment and 92% of the Company’s accounts receivable For the twelve months ended December 31, 2022 2021 Revenue XpresSpa $ 13,680 $ 4,614 XpresTest 38,523 69,078 Treat 1,392 37 HyperPointe 2,344 — Corporate and other — — Total revenue $ 55,939 $ 73,729 For the twelve months ended December 31, 2022 2021 Operating loss XpresSpa $ (12,910) $ (9,617) XpresTest 2,403 25,452 Treat (10,577) (5,735) HyperPointe (1,165) — Corporate and other (8,914) (5,993) Total operating (loss) income $ (31,163) $ 4,107 2022 2021 Depreciation & Amortization XpresSpa $ 1,479 $ 1,281 XpresTest 1,711 1,858 Treat 1,876 50 HyperPointe 332 — Corporate and other 31 12 Total depreciation & amortization $ 5,429 $ 3,201 2022 2021 Capital Expenditures XpresSpa $ 2,134 $ 908 XpresTest 775 1,723 Treat 3,274 5,904 HyperPointe — — Corporate and other 110 136 Total capital expenditures $ 6,293 $ 8,671 As of December 31, 2022 2021 Long-lived Assets XpresSpa $ 11,851 8,419 XpresTest 112 2,246 Treat 2,314 2,700 HyperPointe 4,108 — Corporate and other 409 1,132 Total long-lived Assets $ 18,794 $ 14,497 2022 2021 Assets XpresSpa $ 21,135 $ 12,351 XpresTest 4,285 19,349 Treat 3,186 5,918 HyperPointe 6,913 — Corporate and other 34,907 89,648 Total assets $ 70,426 $ 127,266 Long-lived assets includes property and equipment, right of use lease assets, security deposits, equity investments and restricted cash. The Company performed impairment assessments of long-lived assets and operating lease right-of-use asset for the years ended December 31, 2022 and 2021. Based upon the results of the impairment tests, the Company recorded impairment expenses of long-lived assets for approximately $619, $677 and $3,373 for its XpresSpa, XpresTest and Treat segments respectively for the year ended December 31, 2022. Additionally, the Company recorded impairment expenses of lease right-of-use asset for approximately $936, $38 and $136 for its XpresSpa, XpresTest and Treat segments respectively for the year ended December 31, 2022. For the year ended December 31,2021 the Company recorded impairment expenses of long-lived assets for approximately $68 and impairment expenses of operating lease right-of-use asset for approximately $747 only in its XpresSpa segment; the XpresTest and Treat segments were not impaired in 2021. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Dec. 31, 2022 | |
Accrued Expenses and Other Current Liabilities | |
Accrued Expenses and Other Current Liabilities | Note 17. Accrued Expenses and Other Current Liabilities As of December 31, 2022, and 2021, the Company’s accrued expenses and other current liabilities were comprised of the following: December 31, 2022 December 31, 2021 Litigation accrual $ 963 $ 845 Accrued compensation 2,008 2,862 Tax-related liabilities 573 603 Common area maintenance accruals 160 — AP Accruals 754 431 Gift certificates 496 494 Construction accrual — 930 Credit card processing fees 33 501 Other miscellaneous accruals 732 757 Total accrued expenses and other current liabilities $ 5,719 $ 7,423 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes. | |
Income Taxes | Note 18. Income Taxes For the years ended December 31, 2022 and 2021, the income (loss) before income taxes consisted of the following: 2022 2021 Domestic $ (32,445) $ 3,137 Foreign (129) (188) $ (32,574) $ 2,949 Income tax expense for the years ended December 31, 2022 and 2021 consisted of the following: For the years ended December 31, 2022 2021 Current: Federal $ — $ — State 41 56 Foreign 14 — Deferred: Federal — — $ 55 $ 56 Income tax expense differed from the amounts computed by applying the applicable United States federal income tax rate to loss from continuing operations before taxes on income as a result of the following: For the years ended December 31, 2022 2021 Income (loss) from operations before income taxes $ (32,574) $ 2,949 Tax rate 21 % 21 % Computed “expected” tax benefit (6,841) 619 State taxes, net of federal income tax benefit 706 1,516 Change in valuation allowance 7,014 (10,946) Adjustment JV Basis 339 4,445 Nondeductible expenses 341 1,104 Return to Provision Adjustment (94) 2,403 State Deferred Rate Change (570) — Asset Impairment Adjustment (810) — Other items (31) 915 Income tax expense $ 55 $ 56 Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities as of December 31, 2022 and 2021 are as follows: December 31, 2022 2021 Deferred income tax assets Net operating loss carryforwards $ 51,932 $ 48,556 Stock-based compensation 1,029 507 Intangible assets and other 7,298 4,235 Net deferred income tax assets 60,259 53,298 Less: Valuation allowance (60,259) (53,298) Net deferred income tax assets $ — $ — The Company assesses the need for a valuation allowance related to its deferred income tax assets by considering whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. A valuation allowance has been recorded against the Company’s deferred income tax assets, as it is in the opinion of management that it is more likely than not that the net operating loss carryforwards ("NOL") will not be utilized in the foreseeable future. The cumulative valuation allowance as of December 31, 2022 is $60,259 which will be reduced if and when the Company determines that the deferred income tax assets are more likely than not to be realized. As of January 1, 2021 $ 64,245 Charged to cost and expenses (8,544) Return to provision true-up and other (2,403) As of December 31, 2021 53,298 Charged to cost and expenses 6,864 Return to provision true-up and other 97 As of December 31, 2022 $ 60,259 As of December 31, 2022, 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 $75,045 for U.S. federal purposes with an indefinite life due to new regulations in the Tax Cuts and Jobs 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, the Company’s ability to utilize all such NOL and credit carryforwards may be limited. The Coronavirus Aid, Relief, and Economic Security Act or "CARES Act" was enacted subsequent to the December 31, 2019 period, on March 27, 2020. The CARES act provided for favorable business provisions. However, the Company does not anticipate the income tax provision changes to materially benefit the Company. The Company files its tax returns in the U.S. federal jurisdiction, as well as in various state and local jurisdictions. The company is not currently under audit in any taxing jurisdictions. The federal statute of limitations for audit consideration is 3 years from the filing date, and generally states implement a statute of limitations between 3 and 5 years. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies | |
Commitments and Contingencies | Note 19. Commitments and Contingencies Certain of the Company’s outstanding legal matters include speculative claims for substantial or indeterminate amounts of damages. The Company regularly evaluates developments in its legal matters that could affect the amount of any potential liability and makes adjustments as appropriate. Significant judgment is required to determine both the likelihood of there being any potential liability and the estimated amount of a loss related to the Company’s legal matters. With respect to the Company’s outstanding legal matters, based on its current knowledge, the Company’s management believes that the amount or range of a potential loss will not, either individually or in the aggregate, have a material adverse effect on its business, consolidated financial position, results of operations or cash flows. However, the outcome of such legal matters is inherently unpredictable and subject to significant uncertainties. The Company evaluated the outstanding legal matters and assessed the probability and likelihood of the occurrence of liability. Based on management’s estimates, the Company has recorded accruals of $963 and $845 as of December 31, 2022 and December 31, 2021, respectively, which is included in Accrued expenses and other current liabilities The Company expenses legal fees in the period in which they are incurred. Kyle Collins v. Spa Products Import & Distribution Co., LLC et al This is a combined class action and California Private Attorney’s General Act (“PAGA”) action. Plaintiff seeks to recover wages, penalties and PAGA penalties for claims for (1) failure to provide meal periods, (2) failure to provide rest breaks, (3) failure to pay overtime, (4) inaccurate wage statements, (5) waiting time penalties, and (6) PAGA penalties of $0.1 per employee per pay period per violation. There are approximately 240 current and former employees in the litigation class. The parties agreed to mediation on May 26, 2020, however, due to COVID-19, the parties subsequently stayed all proceedings. The mediation session occurred on March 18, 2021, and the parties reached a settlement which was approved on September 20, 2022 for the amount of $513 and additional payroll taxes of $4 . Funding of the settlement amount occurred on January 26, 2023. The Company recorded an accrual of $517 as of December 31,2022 which is included in Accrued expenses and other current liabilities OTG Management PHL B v. XpresSpa Philadelphia Terminal B et al. On May 9, 2022, a lawsuit was filed in the Philadelphia Court of Common Pleas by OTG Management at Philadelphia International Airport, claiming that XWELL improperly backed out of its sublease for space at Terminal B and now owes between $864 and $2,250 in accelerated rent for the 12-year contract. They claim that by refusing to complete the project, failing to commence and maintain operations, refusing to pay rent and improperly purporting to terminate the lease (among other acts and omissions), XWELL breached the lease. OTG has agreed to extend XWELL’s time to respond to the Complaint to May 6, 2023. In addition to those matters specifically set forth herein, the Company and its subsidiaries are involved in various other claims and legal actions that arise in the ordinary course of business. The Company does not believe that the ultimate resolution of these actions will have a material adverse effect on the Company’s financial position, results of operations, liquidity, or capital resources. However, a significant increase in the number of these claims, or one or more successful claims under which the Company incurs greater liabilities than the Company currently anticipates, could materially adversely affect the Company’s business, financial condition, results of operations and cash flows. In the event that an action is brought against the Company or one of its subsidiaries, the Company will investigate the allegation and vigorously defend itself. Concentrations of Supplier Risk For the XpresTest segment, substantially all supplies for testing were purchased from one vendor. For the XpresSpa segment, substantially all inventory was also purchased from one vendor. Leases XpresSpa is contingently liable to a surety company under certain general indemnity agreements required by various airports relating to its lease agreements. XpresSpa agrees to indemnify the surety for any payments made on contracts of suretyship, guaranty, or indemnity. The Company believes that all contingent liabilities will be satisfied by its performance under the specified lease agreements. |
Accounting and Reporting Poli_2
Accounting and Reporting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting and Reporting Policies | |
Basis of presentation and principles of consolidation | (a) Basis of presentation and principles of consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. The consolidated financial statements include the accounts of the Company, all entities that are wholly owned by the Company, and all entities in which the Company has a controlling financial interest. All significant intercompany balances and transactions have been eliminated in consolidation. |
Use of estimates | (b) Use of estimates The preparation of the accompanying consolidated financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses for the periods presented. Actual results may differ from such estimates. Significant items subject to such estimates and assumptions include the Company’s long-lived assets, intangibles assets, the useful lives of the Company’s intangible assets, the valuation of stock-based compensation, deferred tax assets and liabilities, income tax uncertainties, and other contingencies. |
Translation into United States dollars | (c) Translation into United States dollars The Company conducts certain transactions in foreign currencies, which are recorded at the exchange rate as of the transaction date. All exchange gains and losses occurring from the remeasurement of monetary balance sheet items denominated in non-dollar currencies are deemed non-operating income in the consolidated statements of operations and comprehensive loss. During 2022 and 2021, the Company recorded $664 and $18, respectively, in exchange gains and losses occurring from the remeasurement of monetary balance sheet items denominated in non-dollar currencies. Accounts of the foreign subsidiaries of XpresSpa are translated into United States dollars. Assets and liabilities have been translated primarily at year end exchange rates and revenues and expenses have been translated at average monthly rates for the year. The translation adjustments arising from the use of different exchange rates are included as foreign currency translation within the consolidated statements of operations and comprehensive income (loss) and consolidated statements of changes in stockholders’ equity. |
Cash and cash equivalents | (d) Cash and cash equivalents The Company maintains cash in checking and money market accounts with financial institutions. The Company has established guidelines relating to diversification and maturities of its investments in order to minimize credit risk and maintain high liquidity of funds. The Company considers all highly liquid investments purchased with an original maturity of three months or less from the time they are acquired to be cash equivalents. The Company had $1,885 of such investments as of December 31, 2022 and $0 as of December 31, 2021. |
Accounts Receivables | (e) Accounts Receivables Accounts Receivables are stated at their carrying values, net of a reserve for doubtful accounts, and primarily emanate from our contracts with customers. |
Inventory | (f) Inventory All inventory is valued at the lower of cost or net realizable value. Cost is determined using a weighted-average cost method. |
Intangible assets | (g) Intangible assets Intangible assets include trade names, customer relationships, and technology, which were primarily acquired as part of the acquisition of XpresSpa in December 2016 and Hyperpointe in 2022, 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. Newly acquired or developed software has an estimated life of approximately 3 years whereas the intangibles obtained as a result of the Hyperpointe acquisition have an estimated life of 5 to 12 years. 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 also the magnitude of any such charge. Fair value estimates are made at a specific point in time, based on relevant information. During the years ended December 31, 2022 and 2021, the Company recognized impairment of $110 and $0, respectively. |
Property and Equipment | (h) Property and Equipment Property and equipment are recorded at historical cost and primarily consists of leasehold improvements, furniture and fixtures, and other operating equipment. Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets. Leasehold improvements are depreciated over the lesser of the lease term or economic useful life. Maintenance and repairs are charged to expense, and renovations or improvements that extend the service lives of the Company’s assets are capitalized over the lesser of the extension period or life of the improvement. |
Impairment of long-lived assets | (i) Impairment of long-lived assets Long-lived assets are tested for impairment at the lowest level at which there are identifiable operating cash flows, which is at the individual airport location for the XpresSpa and XpresCheck businesses. The Company’s long-lived assets consist primarily of leasehold improvements and right to use lease assets for each of its airport locations (considered the asset group). The Company reviews its long-lived assets for recoverability yearly or sooner if events or changes in circumstances indicate that the carrying value of long-lived assets 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 groups fair value. The Company estimates the fair value of long-lived assets using present value income approach. Future cash flow was calculated based on forecasts over the estimated remaining useful life of the asset group, which for each of the Company’s airport locations, is the remaining term of the operating lease. The Company completed an assessment of our property and equipment, operating lease right of use assets and intangible assets for impairment as of December 31, 2022. Based upon the results of the impairment test, the Company recorded an impairment expense related to property and equipment, intangible assets, and operating lease right of use assets of $4,559, $110 and , respectively, during the year ended December 31, 2022, which is included in Impairment of long-lived assets and Impairment of operating lease right-of-use assets In 2021 the Company recorded an impairment expense of approximately $68 and $747 related to property and equipment, and operating lease right of use assets, respectively, which is included in Impairment of long-lived assets and Impairment of operating lease right-of-use assets |
Leases | (j) Leases The right of use asset (“ROU”) on the Company’s consolidated balance sheet represents a lessee's right to use an asset over the life of a lease. Operating lease ROU assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term, plus any lease payments made to the lessor before the lease commencement date, plus any initial direct costs incurred, minus any lease incentives received. The amortization period for the right of use asset is from the lease commencement date to the earlier of the end of the lease term or the end of the useful life of the asset. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has elected to exclude all short-term leases (i.e, leases with term of 12 months or less) from recognition on the balance sheet. The Company’s lease liabilities are determined by calculating the present value of all future lease payments using the rate implicit in the lease if it can be readily determined, or the lessee’s incremental borrowing rate. The Company uses its incremental borrowing rate at the inception of the lease to determine the present value of future lease payments as the rate implicit in its leases could not be readily determined. Certain leases provide for contingent rents that are not measurable at inception. These contingent rents are primarily based on a percentage of sales that are in excess of a predetermined level, an increase based on a change in the consumer price index or fair market value. These amounts are excluded from the calculation of the right of use asset and lease liability under ASC 842. Minimum rent under these leases is included in the determination of rent expense when it is probable that the expense has been incurred and the amount can be reasonably estimated. The Financial Accounting Standards Board (“FASB”) issued a Q&A in March 2020 that focused on the application of lease guidance in ASC 842 for lease concessions related to the effects of COVID-19. The FASB staff has said that entities can elect to not evaluate whether concessions granted by lessors related to COVID-19 are lease modifications. Entities that make this election can then apply the lease modification guidance in ASC 842 or account for the concession as if it were contemplated as part of the existing contract. The Company has elected to not treat the concessions as lease modifications and will instead account for the lease concessions as if they were contemplated as part of the existing leases. The Company has recorded negative variable lease expense and adjusted lease liabilities at the point in which the rent concession has become accruable. |
Restricted cash | (k) Restricted cash Restricted cash, which is listed as a separate line item in the consolidated balance sheets, represents balances at financial institutions to secure bonds and letters of credit as required by the Company’s various lease agreements. |
Equity investments | (l) Equity investments Equity investments are carried at fair value with the changes in fair value recorded in the consolidated statement of operations and other comprehensive income (loss) in accordance with ASU 2016-01. The Company will perform a qualitative assessment on an annual basis and recognize impairment if there are sufficient indicators that the fair value of the investment is less than the carrying value. |
Revenue recognition | (m) Revenue recognition XpresSpa The Company recognizes revenue from the sale of XpresSpa products and services when the services are rendered at XpresSpa stores and from the sale of products at the time products are purchased at the Company’s stores or online usually by credit card, net of discounts and applicable sales taxes. Accordingly, the Company recognizes revenue for the Company’s single performance obligation related to both in-store and online sales at the point at which the service has been performed or the control of the merchandise has passed to the customer. Revenues from the XpresSpa retail and e-commerce businesses are recorded at the time goods are shipped. The Company has also entered into collaborative agreements with marketing partners whereby it sells certain of its partners’ products in the Company’s XpresSpa spas. The Company acts as an agent for revenue recognition purposes and therefore records revenue net of the revenue share payable to the partners. Upon receipt of the non-recurring, non-refundable initial collaboration fee, management records a deferred revenue liability and recognizes revenue on a straight-line basis over the life of the collaboration agreement. XpresCheck Through its XpresCheck Wellness Centers and under the terms of the Managed Services Agreement (“MSA”) with PLLCs that in turn contract with physicians and Nurse Practitioners, the Company offers testing services to airline employees, contractors, concessionaire employees, TSA officers and U.S. Customs and Border Protection agents, as well as the traveling public. The Company has entered into MSAs with PLLCs that provide healthcare services to patients. Under the terms of the MSAs which may be modified for commercial reasonableness and fair market value, XpresTest provides office space, equipment, supplies, non-licensed staff, and management services to be used for the purpose of COVID-19 and other medical diagnostic testing in return for a management fee which was deemed a performance obligation for recognizing revenue prior to July 1, 2021. However, as a result of uncertainties around the cash flows of the XpresCheck Wellness Centers, the Company concluded in 2020 that the collectability criteria to qualify as a contract under ASC 606 was not met, and therefore, revenue associated with the monthly management fee would not be recognized until a subsequent reassessment resulted in the MSAs meeting the collectability criteria. XpresTest recognized revenue of $16,843 (including a cumulative catch-up adjustment of $3,186) Effective, July 1, 2021 (see Note 4), the Company determined that the PLLCs are variable interest entities due to its equity holder having insufficient capital at risk, and the Company having a variable interest in the PLLCs. In pursuance, the total revenue of $50,689 for the PLLCs for the six months period ended December 31, 2021 were designated as revenue for the company. The performance obligation for this revenue was the PLLCs administering COVID-19 tests to airline employees, contractors, concessionaire employees, TSA officers and U.S. Customs and Border Protection agents, as well as the traveling public, with revenue being recognized at the point in time at which the service is performed. During 2021, XpresCheck initiated a $2,001, eight-week pilot program with the Centers for Disease Control and Prevention (CDC) in collaboration with Concentric by Ginkgo. Under this program, XpresCheck is conducting biosurveillance monitoring at four major U.S. airports (JFK International Airport, Newark Liberty International Airport, San Francisco International Airport, and Hartsfield-Jackson Atlanta International Airport) aimed at identifying existing and new SARS-CoV-2 variants. On January 31, 2022, the Company announced the extension of the program, bringing the total contract to $5,534. Approximately $4,166 and $1,368 of the full $5,534 amount was recognized during 2022 and 2021, respectively. During the third quarter of 2022, XpresTest, in partnership with Ginkgo Bioworks in continuation of their support to the CDC’s traveler-based SARS-CoV-2 genomic surveillance program were awarded a new contract. The partnership is expected to support public health and biosecurity services totaling approximately $16,000, with an overall potential to exceed $61,000 based on CDC program options and public health priorities. As COVID-19 sub-variants and other biological threats continue to emerge, the partners plan to expand the program footprint and incorporate innovative modalities and offerings, such as monitoring of wastewater from aircraft lavatories. The current contract with Ginkgo Bioworks related to the above partnership contains fixed pricing for which we are entitled to $6,761 for the sample collection (passenger and aircraft wastewater) and $570 for the traveler enrollment initiatives, which represents the amount of consideration that we are entitled. We recognize revenue over time for both sample collection performance obligations, using the input method based on time elapsed to measure progress towards satisfying each of the performance obligations. We recognize revenue ratably (straight line basis) over the term of the contract (one year). We will recognize revenue over time for the traveler enrollment initiative performance obligation based on the amount for which we have the right to invoice. We recorded $2,617 in revenue during 2022 related to sample collection performance obligations because the Company’s efforts towards satisfying each of the performance obligations are expended evenly throughout the period of performance. HyperPointe Our HyperPointe segment which we acquired in January 2022 ( see Note 10 Acquisition of HyperPointe) satisfied over time with revenue recognized ratably over the contract term. Advanced services are distinct performance obligations that are satisfied over time with revenue recognized as services are delivered. Revenue billed in advance are treated as deferred revenue which was $322 as of December 31, 2022. The Company excludes all sales taxes assessed to our customers from revenue. Sales taxes assessed on revenues are included in Accrued expenses and other current liabilities |
Gift cards and customer rewards program | (n) Gift cards and customer rewards program XpresSpa offers no-fee, non-expiring gift cards to its customers. No revenue is recognized upon issuance of a gift card and a liability is established for the gift card’s cash value. The liability is relieved, and revenue is recognized upon redemption by the customer. As the gift cards have no expiration date, there is no provision for reduction in the value of unused card balances. In addition, XpresSpa maintains a rewards program in which customers earn loyalty points, which can be redeemed for future services. Loyalty points are rewarded upon joining the loyalty program, for customer birthdays, and based upon customer spending. When a customer redeems loyalty points, the Company recognizes revenue for the redeemed cash value and reduces the related loyalty program liability. On June 1, 2018, the Company adopted a formal expiration policy whereby any loyalty members with inactivity for an 18-month period will forfeit any unused loyalty rewards. Upon closure of the spa locations in March 2020, the Company temporarily suspended the expiration policy. The costs associated with gift cards and reward points are accrued as the rewards are earned by the cardholder and are included in Accrued expenses and other current liabilities |
Segment reporting | (o) Segment reporting ASC 280, Segment Reporting There are currently no intersegment revenues. Asset information by operating segment is presented below since the chief operating decision maker reviews this information by segment. The reporting segments follow the same accounting policies used in the preparation of the Company’s audited consolidated financial statements. |
Pre-opening costs | (p) Pre-opening costs Pre-opening and start-up activity costs, which include rent and occupancy, supplies, advertising, and other direct expenses incurred prior to the opening of a new store, are expensed in the period in which they are incurred. |
Cost of sales | (q) Cost of sales Cost of sales consists of spa and clinic operating costs. These costs include all costs that are directly attributable to the location’s operations and include: ● payroll and related benefits for the location’s operations and management; ● rent, percentage rent and occupancy costs; ● the cost of merchandise and testing supplies; ● freight, shipping and handling costs; ● production costs; ● inventory shortage and valuation adjustments; and ● costs associated with sourcing operations. |
Stock-based compensation | (r) Stock-based compensation Stock-based compensation is recognized as an expense in the consolidated statements of operations and comprehensive loss and such cost is measured at the grant-date fair value of the equity-settled award. The fair value of stock options is estimated as of the date of grant using the Black-Scholes-Merton (“Black-Scholes”) option-pricing model. The fair value of Restricted Stock Units (“RSUs”) is calculated as of the date of grant using the grant date closing share price multiplied by the number of RSUs granted. The expense is recognized on a straight-line basis, over the requisite service period. The Company uses the simplified method to estimate the expected term of options due to insufficient history and high turnover in the past. Expected volatility is estimated based on a weighted average historical volatility of the Company. The risk-free rate for the expected term of the option is based on the United States Treasury yield curve as of the date of grant. The Company recognizes forfeitures as they occur. The Company issues new stock to deliver shares under its Equity Plan. |
Income taxes | (s) Income taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not more likely than not to be realized. Tax benefits related to excess deductions on stock-based compensation arrangements are recognized when they reduce taxes payable. In assessing the need for a valuation allowance, the Company looks at cumulative losses in recent years, estimates of future taxable earnings, feasibility of tax planning strategies, the ability to realize tax benefit carryforwards, and other relevant information. Valuation allowances related to deferred tax assets can be impacted by changes to tax laws, changes to statutory tax rates and future taxable earnings. Ultimately, the actual tax benefits to be realized will be based upon future taxable earnings levels, which are very difficult to predict. In the event that actual results differ from these estimates in future periods, the Company will be required to adjust the valuation allowance. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company had no uncertain tax positions as of December 31, 2022 and 2021. |
Noncontrolling interests | (t) Noncontrolling interests Noncontrolling interests represent the noncontrolling holders’ percentage share of earnings or losses from; i) the subsidiaries, in which the Company holds a majority, but less than 100%, ownership interest, ii) Variable Interest Entities, where the Company is a primary beneficiary (See sub note (w) below, and the results of which are included in the Company’s consolidated statements of operations and comprehensive income (loss). Net loss attributable to noncontrolling interests represents the proportionate share of the noncontrolling holders’ ownership in certain subsidiaries of XpresSpa and of XpresTest. |
Net income/(loss) per common share | (u) Net income/(loss) per common share Basic net income (loss) per share is computed by dividing the net income (loss) attributable to common shareholders for the period by the weighted-average number of shares of Common Stock outstanding during the period. Diluted net income (loss) per share is computed by dividing the net loss attributable to the Company for the period by the weighted-average number of shares of Common Stock plus dilutive potential Common Stock considered outstanding during the period. |
Commitments and contingencies | (v) Commitments and contingencies Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or un-asserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or un-asserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed. Legal costs expected to be incurred in connection with a loss contingency are expensed as incurred. |
Variable Interest Entities | (w) Variable Interest Entities The Company evaluates its ownership, contractual, pecuniary, and other interests in entities to determine if it has any variable interest in a variable interest entity (“VIE”). These evaluations are complex and involve judgment. If the Company determines that an entity in which it holds a contractual or ownership interest is a VIE and that the Company is the primary beneficiary, the Company consolidates such entity in its consolidated financial statements. The primary beneficiary of a VIE is the party that meets both of the following criteria: (i) has the power to make decisions that most significantly affect the economic performance of the VIE; and (ii) has the obligation to absorb losses or the right to receive benefits that in either case could potentially be significant to the VIE. Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change. Changes in consolidation status are applied prospectively. |
Business Combinations | (x) Business Combinations The Company uses the provisions of ASC Topic 805, Business Combinations (“ASC 805”) in the accounting for acquisitions of businesses. ASC 805 requires the Company to use the acquisition method of accounting by recognizing the identifiable tangible and intangible assets acquired and liabilities assumed, and any non-controlling interest in the acquired business, measured at their acquisition date fair values. Goodwill as of the acquisition date is measured as the excess of consideration transferred over the aforementioned amounts. While the Company uses its best estimates and assumptions to accurately apply preliminary values to assets acquired and liabilities assumed at the acquisition date, these estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Upon the conclusion of the measurement period or final determination of the values of the assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded in the consolidated statements of operations. Accounting for business combinations requires management to make significant estimates and assumptions, especially at the acquisition date, including estimates for intangible assets. Although the Company believes the assumptions and estimates that have been made are reasonable and appropriate, they are based in part on historical experience and information obtained from the acquired companies and are inherently uncertain. Critical estimates in valuing certain of the intangible assets the Company has acquired include future expected cash flows, and discount rates. |
Goodwill | (y) Goodwill Goodwill represents the cost of a business acquisition in excess of the fair value of the net assets acquired. 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, including goodwill. 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. |
Advertising Costs | (z) Advertising Costs Advertising costs are expensed as incurred. Advertising expenses amounted to approximately $4,645 and $2,817 for the years ended December 31, 2022 and 2021, respectively. |
Fair value measurements | (aa) Fair value measurements The Company measures fair value in accordance with ASC 820-10, Fair Value Measurements and Disclosures. ASC 820-10 clarifies that fair value is an exit price, representing the amount that would be received by selling an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, ASC 820-10 establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 Level 2 Level 3 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. |
Reclassification | (bb) Reclassification Certain balances in the 2021 consolidated financial statements have been reclassified to conform to the presentation in the 2022 consolidated financial statements, primarily the separate classification and presentation of accounts payable, gross profits, impairments and loss on disposal of assets. Such reclassifications did not have a material impact on the consolidated financial statements. |
Recently adopted accounting pronouncements | (cc) Recently adopted accounting pronouncements Accounting Standards Update No. 2020-06—Debt--Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) Issued in August 2020, this update is intended to reduce the unnecessary complexity of the current guidance thus resulting in more accurate accounting for convertible instruments and consistent treatment from one entity to the next. Under current GAAP, there are five accounting models for convertible debt instruments. Except for the traditional convertible debt model that recognizes a convertible debt instrument as a single debt instrument, the other four models, with their different measurement guidance, require that a convertible debt instrument be separated (using different separation approaches) into a debt component and an equity or a derivative component. Convertible preferred stock also is required to be assessed under similar models. The Financial Accounting Standard Board (“FASB”) decided to simplify the accounting for convertible instruments by removing certain separation models currently included in other accounting guidance that were being applied to current accounting for convertible instruments. Under the amendments in this update, an embedded conversion feature no longer needs to be separated from the host contract for convertible instruments with conversion features that are not required to be accounted for as derivatives. Consequently, a convertible debt instrument will be accounted for as a single liability measured at its amortized cost and a convertible preferred stock will be accounted for as a single equity instrument measured at its historical cost, as long as no other features require bifurcation and recognition as derivatives. The FASB also decided to add additional disclosure requirements in an attempt to improve the usefulness and relevance of the information being provided. The new standard is effective for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years. The Company adopted ASU 2020-06 as of the reporting period beginning January 1, 2022. The adoption of this update did not have a material impact on the Company’s condensed consolidated financial statements. ASU 2021-04: Issuer's Accounting for Certain Modifications or Exchanges of Freestanding Equity Classified Written Call Options In May 2021, the FASB issued ASU 2021-04, "Issuer's Accounting for Certain Modifications or Exchanges of Freestanding Equity Classified Written Call Options'" ("ASU 2021-04"), which introduces a new way for companies to account for warrants either as stock compensation or derivatives. Under the new guidance, if the modification does not change the instrument's classification as equity, the company accounts for the modification as an exchange of the original instrument for a new instrument. In general, if the fair value of the "new" instrument is greater than the fair value of the "original" instrument, the excess is recognized based on the substance of the transaction, as if the issuer has paid cash. The effective date of the standard is for interim and annual reporting periods beginning after December 15, 2021 for all entities. The Company adopted ASU 2021-04 as of the reporting period beginning January 1, 2022. The adoption of this update did not have a material impact on the Company’s condensed consolidated financial statements. |
Recently Issued Accounting Standards | (dd) Recently Issued Accounting Standards In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). ASU 2016-13's main goal is to improve financial reporting by requiring earlier recognition of credit losses on financing receivables and other financial assets in scope. The guidance is effective for annual periods beginning after December 15, 2022, including interim periods within those fiscal years. The ASU is not expected to have material impact on the Company’s financial statements. In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”). ASU 2021-08 requires contract assets and contract liabilities acquired in a business acquisition to be recognized and measured in accordance with ASC Topic 606, Revenues from Contracts with Customers, which the Company generally expects will result in the recognition and measurement of contract assets and contract liabilities in a manner that is consistent with the acquiree. For the Company, the amendments are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. The materiality of the application of ASU 2021-08 depends on the recognition and measurement of acquired assets and liabilities associated with future acquisitions. |
Net earnings (loss) per Share o
Net earnings (loss) per Share of Common Stock (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Net earnings/(loss) per Share of Common Stock | |
Schedule of computation of basic and diluted net earnings/(losses) per common share | Year ended December 31, 2022 2021 Basic numerator: Net (loss) income attributable to XWELL, Inc. $ (32,837) $ 3,349 Net (loss) income attributable to common shareholders $ (32,837) $ 3,349 Basic denominator: Basic weighted average shares outstanding 93,655,331 104,306,173 Basic (loss) earnings per share $ (0.35) $ 0.03 Diluted numerator: (Loss) earnings attributable to common shareholders $ (32,837) $ 3,349 Diluted denominator: Diluted weighted average shares outstanding 93,655,331 105,076,758 Diluted (loss) earnings per share $ (0.35) $ 0.03 Net (loss) income per share data presented above excludes from the calculation of diluted net (loss) income, the following potentially dilutive securities, having an anti-dilutive impact, in case of net loss Both vested and unvested options to purchase an equal number of shares of Common Stock 4,830,029 2,614,766 Unvested RSUs to issue an equal number of shares of Common Stock 281,250 521,049 Warrants to purchase an equal number of shares of Common Stock 1,172,088 37,338,164 Total number of potentially dilutive securities excluded from the calculation of earnings/(loss) per share attributable to common shareholders 6,283,367 40,473,979 |
Cash, Cash Equivalents, and R_2
Cash, Cash Equivalents, and Restricted Cash (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Cash, Cash Equivalents, and Restricted Cash | |
Schedule of cash, cash equivalents, and restricted cash | December 31, 2022 December 31, 2021 Cash denominated in United States dollars $ 16,344 $ 102,560 Cash denominated in currency other than United States dollars 2,562 2,133 Restricted cash 751 751 Credit and debit card receivables 132 813 Total cash, cash equivalents and restricted cash $ 19,789 $ 106,257 |
Other Current Assets (Tables)
Other Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Current Assets | |
Schedule of other current assets | December 31, 2022 December 31, 2021 Prepaid expenses $ 1,074 $ 1,047 Other 48 48 Total other current assets $ 1,122 $ 1,095 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property and Equipment | |
Schedule of property and equipment | December 31, 2022 2021 Useful Life Leasehold improvements $ 8,692 $ 11,225 Average 5-8 years Furniture and fixtures 1,214 1,146 3-4 years Other operating equipment 760 1,027 Maximum 5 years 10,666 13,398 Accumulated depreciation (7,000) (6,740) Total property and equipment, net $ 3,666 $ 6,658 |
Other Assets (Tables)
Other Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Assets | |
Schedule of other assets | December 31, 2022 December 31, 2021 Equity investments $ 104 $ 722 Lease deposits 1,973 2,030 Other 292 58 Other assets $ 2,369 $ 2,810 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Intangible Assets | |
Schedule of company's intangible assets | December 31, 2022 December 31, 2021 Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amount Amortization Amount Amount Amortization Amount Trade names $ 302 $ (24) $ 278 $ 1,339 $ (1,118) $ 221 Customer relationships 1,510 (542) 968 — — — Software 4,485 (1,761) 2,724 3,886 (484) 3,402 Licenses 55 (17) 38 116 (7) 109 Total intangible assets $ 6,352 $ (2,344) $ 4,008 $ 5,341 $ (1,609) $ 3,732 |
Schedule of estimated amortization expense | Calendar Years ending December 31, Amount 2023 $ 1,503 2024 1,462 2025 411 2026 317 2027 77 Thereafter 238 Total $ 4,008 |
Acquisition of HyperPointe (Tab
Acquisition of HyperPointe (Tables) - HyperPointe | 12 Months Ended |
Dec. 31, 2022 | |
Business Acquisition [Line Items] | |
Schedule of recognized identified assets acquired and liabilities assumed | Consideration paid $ 7,257 Fair value of assets acquired and liabilities assumed Cash and cash equivalents $ 2,269 Accounts receivable 346 Unbilled Receivables 56 Prepaid expenses and other current assets 19 Other long-term assets 16 Property and equipment 68 Customer relationships 1,198 Trade name 302 Software 335 Accounts payable (653) Deferred revenue (723) 3,233 Goodwill $ 4,024 |
Customer relationships [Member] | |
Business Acquisition [Line Items] | |
Schedule of significant assumptions utilized in valuation of intangible assets | Customer relationships Attrition Rate 15.00 % Existing Customer Growth 3.00 % Business Development Expense for New Customers 0.50 % Customer relationships Discount Rate 26.00 % Estimated Remaining Economic Life (Years) (approx.) 5 yrs |
Trade names [Member] | |
Business Acquisition [Line Items] | |
Schedule of significant assumptions utilized in valuation of intangible assets | % of Revenue Attributable to Trade Name 100 % Royalty Rate 1.00 % Trade Name Discount Rate 24.50 % Remaining Economic Life (Years) 12 yrs |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases | |
Schedule of supplemental cash flow information related to leases | Year ended December 31, 2022 2021 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ (4,092) $ (4,230) Leased assets obtained in exchange for new and modified operating lease liabilities $ 6,891 $ 3,646 Leased assets surrendered in exchange for termination of operating lease liabilities $ — $ 9 |
Schedule of future minimum commitments | Calendar Years ending December 31, Amount 2023 $ 3,479 2024 3,153 2025 2,676 2026 1,618 2027 1,495 Thereafter 4,389 Total future lease payments 16,810 Less: interest expense at incremental borrowing rate (2,703) Net present value of lease liabilities $ 14,107 |
Schedule of other assumptions and pertinent information | Weighted average remaining lease term: 5.98 years Weighted average discount rate used to determine present value of operating lease liability: 7.69 % |
Stockholders' Equity and Warr_2
Stockholders' Equity and Warrants (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Stockholders' Equity and Warrants | |
Schedule of information about all warrant activity | Weighted average Exercise No. of warrant exercise price price range December 31, 2021 37,817,694 $ 2.99 $ 0.525 - 6.566 Granted — $ — $ Exercised — $ — $ Expired (36,645,606) $ 3.02 $ 1.7 - 6.566 December 31, 2022 1,172,088 $ 2.00 $ 1.7 - 2.125 |
Schedule of outstanding equity warrants | Remaining contractual No. outstanding Exercise price life Expiration Date January 2021 Placement Agent Warrants 510,588 $ 2.125 0.08 years January 28, 2023 January 2021 Placement Agent Tail Fee 35,000 $ 1.7 0.08 years January 28, 2023 February 2021 Placement Agent Warrants 284,000 $ 2.125 0.12 years February 11, 2023 February 2021 Placement Agent Warrants 48,000 $ 2.125 0.13 years February 16, 2023 February 2021 Placement Agent Tail Fee 248,500 $ 1.7 0.12 years February 11, 2023 February 2021 Placement Agent Tail Fee 42,000 $ 1.7 0.13 years February 16, 2023 December 2021 Placement Agent Tail Fee 4,000 $ 2.125 0.99 years December 27, 2023 1,172,088 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Measurements | |
Schedule of asset and liabilities measured at fair value on recurring and nonrecurring basis | Fair value measurement at reporting date using Quoted prices in active markets Significant other Significant for identical observable unobservable Balance assets (Level 1) inputs (Level 2) inputs (Level 3) As of December 31, 2022: Recurring fair value measurements Equity securities: Route1, Inc. $ 104 $ — $ 104 $ — Total equity securities 104 — 104 — Total recurring fair value measurements $ 104 $ — $ 104 $ — Nonrecurring fair value measurements Intangible assets 4,008 — — 4,008 Total nonrecurring fair value measurements $ 4,008 $ — $ — $ 4,008 As of December 31, 2021 Recurring fair value measurements Equity securities: $ 722 $ — $ 722 $ — Total equity securities 722 — 722 — Total recurring fair value measurements $ 722 $ — $ 722 $ — |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Stock-based Compensation | |
Schedule of fair value of stock options estimated | Share price of the Company’s Common Stock on the grant date: $ 0.65 - 1.64 Exercise price: $ 0.65 - 1.64 Expected volatility: 119.41 - 123.45 % Expected dividend yield: 0 % Annual average risk-free rate: 1.62 - 4.14 % Expected term: 6.41 - 6.43 years |
Stock options and restricted stock units activity | The following tables summarize information about stock options and RSU activity during the year ended December 31, 2022: RSUs XpresTest RSAs Stock options Weighted Weighted Weighted average average average Exercise No. of grant date No. of grant date No. of exercise price RSUs fair value RSAs fair value options price range Outstanding as of December 31, 2021 600,000 $ 1.63 — $ — 2,826,871 $ 2.57 $ 1.19 - 2,460 Granted 531,250 0.84 15.0 56,890 2,350,338 1.46 0.65 - 1.64 Exercised/Vested (850,000) 1.46 (10.0) 61,550 — — Forfeited — — — — (245,027) 1.55 1.43-3.82 Expired — — — — (102,153) 6.05 1.44-2,232 Outstanding as of December 31, 2022 281,250 $ 0.65 5.0 $ 47,570 4,830,029 $ 2.00 $ 0.65 - 2,460 Exercisable as of December 31, 2022 2,061,259 $ 2.56 $ 1.19 - 2,460 The following tables summarize information about stock options and RSU activity during the year ended December 31, 2021: RSUs XpresTest RSAs Stock options Weighted Weighted Weighted average average average Exercise No. of grant date No. of grant date No. of exercise price RSUs fair value RSAs fair value options price range Outstanding as of December 31, 2020 — $ — 28.75 $ 11,390.35 1,353,888 $ 3.82 $ 1.53 - 2,460.0 Granted 1,349,167 1.58 120.00 5,227.20 1,668,297 1.56 1.19 - 1.61 Exercised/Vested (749,167) 1.54 (148.75) 6,418.40 (8,334) 1.53 Forfeited — — — — (183,230) 1.61 Expired — — — — (3,750) 50.8 NA Outstanding as of December 31, 2021 600,000 $ 1.63 — $ — 2,826,871 $ 2.57 $ 1.19 - 2,460.0 Exercisable as of December 31, 2021 1,024,694 $ 3.81 $ 1.19 - 2,460.0 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Information | |
Schedule of revenue from external customers and long-lived assets, by geographical areas | For the years ended December 31, 2022 2021 Revenue United States $ 52,250 $ 71,114 All other countries 3,689 2,615 Total revenue $ 55,939 $ 73,729 Long-lived assets United States $ 15,084 $ 9,698 All other countries 3,710 4,799 Total long-lived assets $ 18,794 $ 14,497 |
Schedule of segment reporting information, by segment | For the twelve months ended December 31, 2022 2021 Revenue XpresSpa $ 13,680 $ 4,614 XpresTest 38,523 69,078 Treat 1,392 37 HyperPointe 2,344 — Corporate and other — — Total revenue $ 55,939 $ 73,729 For the twelve months ended December 31, 2022 2021 Operating loss XpresSpa $ (12,910) $ (9,617) XpresTest 2,403 25,452 Treat (10,577) (5,735) HyperPointe (1,165) — Corporate and other (8,914) (5,993) Total operating (loss) income $ (31,163) $ 4,107 2022 2021 Depreciation & Amortization XpresSpa $ 1,479 $ 1,281 XpresTest 1,711 1,858 Treat 1,876 50 HyperPointe 332 — Corporate and other 31 12 Total depreciation & amortization $ 5,429 $ 3,201 2022 2021 Capital Expenditures XpresSpa $ 2,134 $ 908 XpresTest 775 1,723 Treat 3,274 5,904 HyperPointe — — Corporate and other 110 136 Total capital expenditures $ 6,293 $ 8,671 As of December 31, 2022 2021 Long-lived Assets XpresSpa $ 11,851 8,419 XpresTest 112 2,246 Treat 2,314 2,700 HyperPointe 4,108 — Corporate and other 409 1,132 Total long-lived Assets $ 18,794 $ 14,497 2022 2021 Assets XpresSpa $ 21,135 $ 12,351 XpresTest 4,285 19,349 Treat 3,186 5,918 HyperPointe 6,913 — Corporate and other 34,907 89,648 Total assets $ 70,426 $ 127,266 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accrued Expenses and Other Current Liabilities | |
Schedule of accrued expenses and other current liabilities | December 31, 2022 December 31, 2021 Litigation accrual $ 963 $ 845 Accrued compensation 2,008 2,862 Tax-related liabilities 573 603 Common area maintenance accruals 160 — AP Accruals 754 431 Gift certificates 496 494 Construction accrual — 930 Credit card processing fees 33 501 Other miscellaneous accruals 732 757 Total accrued expenses and other current liabilities $ 5,719 $ 7,423 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes. | |
Schedule of income before income tax, domestic and foreign | 2022 2021 Domestic $ (32,445) $ 3,137 Foreign (129) (188) $ (32,574) $ 2,949 |
Schedule of components of income tax expense (benefit) | For the years ended December 31, 2022 2021 Current: Federal $ — $ — State 41 56 Foreign 14 — Deferred: Federal — — $ 55 $ 56 |
Schedule of effective income tax rate reconciliation | For the years ended December 31, 2022 2021 Income (loss) from operations before income taxes $ (32,574) $ 2,949 Tax rate 21 % 21 % Computed “expected” tax benefit (6,841) 619 State taxes, net of federal income tax benefit 706 1,516 Change in valuation allowance 7,014 (10,946) Adjustment JV Basis 339 4,445 Nondeductible expenses 341 1,104 Return to Provision Adjustment (94) 2,403 State Deferred Rate Change (570) — Asset Impairment Adjustment (810) — Other items (31) 915 Income tax expense $ 55 $ 56 |
Schedule of deferred tax assets and liabilities | December 31, 2022 2021 Deferred income tax assets Net operating loss carryforwards $ 51,932 $ 48,556 Stock-based compensation 1,029 507 Intangible assets and other 7,298 4,235 Net deferred income tax assets 60,259 53,298 Less: Valuation allowance (60,259) (53,298) Net deferred income tax assets $ — $ — |
Summary of valuation allowance | As of January 1, 2021 $ 64,245 Charged to cost and expenses (8,544) Return to provision true-up and other (2,403) As of December 31, 2021 53,298 Charged to cost and expenses 6,864 Return to provision true-up and other 97 As of December 31, 2022 $ 60,259 |
General (Details)
General (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Jan. 14, 2022 USD ($) | Jan. 31, 2022 USD ($) | Jun. 30, 2021 USD ($) | Dec. 31, 2022 USD ($) segment location item $ / shares | Dec. 31, 2021 USD ($) item $ / shares shares | Mar. 31, 2023 location | Oct. 24, 2022 $ / shares shares | Sep. 30, 2022 USD ($) | |
Common stock, par value | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | |||||
Number of operating segments | segment | 4 | |||||||
Total revenue, net | $ 55,939 | $ 73,729 | ||||||
Cash and cash equivalents | 19,038 | 105,506 | ||||||
Total current assets | 47,332 | 108,979 | ||||||
Total current liabilities | 10,956 | 19,827 | ||||||
Working capital | 36,376 | 89,152 | ||||||
Investment in marketable securities | 23,153 | |||||||
Issuance of Common Stock on acquisition of gcg Connect, LLC, d/b/a HyperPointe | 906 | |||||||
Other | ||||||||
Total revenue, net | $ 6 | 14 | ||||||
XpresTest | ||||||||
Number of operating locations | location | 1 | |||||||
Unrecognized revenue contract amount | $ 5,534 | 2,001 | ||||||
Number of airports | item | 1 | |||||||
Recognized revenue | $ 4,166 | $ 1,368 | ||||||
XpresTest | Bio-surveillance Monitoring | United States | ||||||||
Number of airport locations | item | 4 | |||||||
Treat | ||||||||
Number of operating locations | location | 2 | |||||||
HyperPointe | ||||||||
Payments to acquire business | $ 7,121 | |||||||
Issuance of Common Stock on acquisition of gcg Connect, LLC, d/b/a HyperPointe | 906 | |||||||
Settlement of intercompany accounts payable | $ 770 | |||||||
Fair value of potential earnout | 0 | |||||||
Timeframe within which potential additional earnout payments to be made for Business acquisition | 3 years | |||||||
HyperPointe | Maximum [Member] | ||||||||
Business acquisition, potential additional earnout payments | $ 7,500 | |||||||
MSAs | XpresTest | ||||||||
Recognized revenue | $ 16,843 | |||||||
Placement Agent Agreement | ||||||||
Cash fees paid | $ 2,162 | |||||||
CDC Program Options and Public Health Services [Member] | XpresTest | ||||||||
Unrecognized revenue | $ 16,000 | |||||||
Total revenue, net | $ 2,617 | |||||||
CDC Program Options and Public Health Services [Member] | XpresTest | Passenger and Aircraft Wastewater Sample Collection | ||||||||
Contract with customer, liability, current | 6,761 | |||||||
CDC Program Options and Public Health Services [Member] | XpresTest | Traveler Enrollment Initiatives | ||||||||
Contract with customer, liability, current | 570 | |||||||
CDC Program Options and Public Health Services [Member] | XpresTest | Minimum [Member] | ||||||||
Unrecognized revenue | $ 61,000 | |||||||
December 2020 Warrants | ||||||||
Total of warrants exercised | shares | 11,273,529 | |||||||
Gross proceeds | $ 19,245 | |||||||
H.C.W. Warrants | Placement Agent Agreement | ||||||||
Warrants issued | shares | 846,588 | |||||||
Warrant exercise price | $ / shares | $ 2.125 | |||||||
Palladium Warrants | Placement Agent Agreement | ||||||||
Warrants issued | shares | 325,500 | |||||||
Warrant exercise price | $ / shares | $ 1.70 | |||||||
Series A Convertible Preferred stock | ||||||||
Preferred stock, par value | $ / shares | $ 0.01 | |||||||
Preferred stock, authorized | shares | 6,968 | |||||||
Preferred stock, outstanding | shares | 0 | |||||||
Series D Convertible Preferred Stock | ||||||||
Preferred stock, par value | $ / shares | $ 0.01 | |||||||
Preferred stock, authorized | shares | 500,000 | |||||||
Preferred stock, outstanding | shares | 0 | |||||||
Series E Convertible Preferred Stock. | ||||||||
Preferred stock, par value | $ / shares | $ 0.01 | |||||||
Preferred stock, authorized | shares | 2,397,060 | |||||||
Preferred stock, outstanding | shares | 0 | |||||||
Series F Convertible Preferred Stock. | ||||||||
Preferred stock, par value | $ / shares | $ 0.01 | |||||||
Preferred stock, authorized | shares | 9,000 | |||||||
Preferred stock, outstanding | shares | 0 |
Accounting and Reporting Poli_3
Accounting and Reporting Policies (Details) $ in Thousands | 1 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jan. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) item | Jun. 30, 2021 USD ($) | Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) item | Sep. 30, 2022 USD ($) | Dec. 31, 2020 USD ($) | |
Foreign exchange loss | $ (664) | $ (18) | |||||
Cash equivalents | $ 0 | 1,885 | 0 | ||||
Credit and debit card receivables | 813 | 132 | 813 | ||||
Cash and cash equivalents | 106,257 | 19,789 | 106,257 | $ 90,502 | |||
Uncertain tax positions | 0 | 0 | 0 | ||||
Advertising expenses | 4,645 | 2,817 | |||||
Deferred revenue | $ 549 | 339 | 549 | ||||
Total revenue | 55,939 | 73,729 | |||||
Impairment on property and equipment | 4,559 | 68 | |||||
Impairment of operating lease right-of-use assets | $ 1,110 | 747 | |||||
Number of reportable segments | segment | 4 | ||||||
Impairment of intangible assets | $ 110 | 0 | |||||
XpresTest | |||||||
Recognized revenue | 4,166 | 1,368 | |||||
Unrecognized revenue contract amount | $ 5,534 | 2,001 | |||||
Impairment of operating lease right-of-use assets | 38 | ||||||
XpresTest | MSAs | |||||||
Recognized revenue | $ 16,843 | ||||||
XpresTest | MSAs | Cumulative catch-up adjustment | |||||||
Recognized revenue | $ 3,186 | ||||||
XpresTest | CDC Program Options and Public Health Services [Member] | |||||||
Total revenue | 2,617 | ||||||
Unrecognized revenue | $ 16,000 | ||||||
XpresTest | Traveler Enrollment Initiatives | CDC Program Options and Public Health Services [Member] | |||||||
Contract with customer, liability, current | 570 | ||||||
XpresTest | Passenger and Aircraft Wastewater Sample Collection | CDC Program Options and Public Health Services [Member] | |||||||
Contract with customer, liability, current | 6,761 | ||||||
XpresSpa | |||||||
Impairment of operating lease right-of-use assets | $ 936 | ||||||
HyperPointe | HyperPointe | |||||||
Deferred revenue | $ 322 | ||||||
United States | XpresTest | Bio-surveillance Monitoring | |||||||
Number of airport locations | item | 4 | 4 | |||||
Minimum [Member] | HyperPointe | |||||||
Expected useful lives (in years) | 5 years | ||||||
Minimum [Member] | XpresTest | CDC Program Options and Public Health Services [Member] | |||||||
Unrecognized revenue | $ 61,000 | ||||||
Maximum [Member] | HyperPointe | |||||||
Expected useful lives (in years) | 12 years | ||||||
Variable Interest Entity, Primary Beneficiary | |||||||
Total revenue | $ 50,689 | $ 32,960 | $ 50,689 | ||||
Software Development [Member] | |||||||
Expected useful lives (in years) | 3 years |
Net earnings (loss) per Share_2
Net earnings (loss) per Share of Common Stock - Potentially Dilutive Securities (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Earnings Per Share Disclosure | ||
Net (loss) income attributable to XWELL, Inc. | $ (32,837) | $ 3,349 |
Net (loss) income attributable to common shareholders | $ (32,837) | $ 3,349 |
Basic weighted average shares outstanding | 93,655,331 | 104,306,173 |
Basic (loss) earnings per share (in dollars per share) | $ (0.35) | $ 0.03 |
Diluted weighted average shares outstanding | 93,655,331 | 105,076,758 |
Diluted (loss) income per share (in dollars per share) | $ (0.35) | $ 0.03 |
Net (loss) income per share data presented above excludes from the calculation of diluted net (loss) income, the following potentially dilutive securities, having an anti-dilutive impact, in case of net loss | ||
Total number of potentially dilutive securities excluded from the calculation of earnings/(loss) per share attributable to common shareholders | 6,283,367 | 40,473,979 |
Both vested and unvested options to purchase an equal number of shares of Common Stock | ||
Net (loss) income per share data presented above excludes from the calculation of diluted net (loss) income, the following potentially dilutive securities, having an anti-dilutive impact, in case of net loss | ||
Total number of potentially dilutive securities excluded from the calculation of earnings/(loss) per share attributable to common shareholders | 4,830,029 | 2,614,766 |
Unvested Restricted Stock Units ("RSU") | ||
Net (loss) income per share data presented above excludes from the calculation of diluted net (loss) income, the following potentially dilutive securities, having an anti-dilutive impact, in case of net loss | ||
Total number of potentially dilutive securities excluded from the calculation of earnings/(loss) per share attributable to common shareholders | 281,250 | 521,049 |
Warrants | ||
Net (loss) income per share data presented above excludes from the calculation of diluted net (loss) income, the following potentially dilutive securities, having an anti-dilutive impact, in case of net loss | ||
Total number of potentially dilutive securities excluded from the calculation of earnings/(loss) per share attributable to common shareholders | 1,172,088 | 37,338,164 |
Variable Interest Entities (Det
Variable Interest Entities (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Variable Interest Entity [Line Items] | |||
Assets | $ 127,266 | $ 70,426 | $ 127,266 |
Liabilities | 27,331 | 22,477 | 27,331 |
Total revenue | 55,939 | 73,729 | |
Variable Interest Entity, Primary Beneficiary | |||
Variable Interest Entity [Line Items] | |||
Assets | 3,033 | 275 | 3,033 |
Liabilities | 683 | 146 | 683 |
Total revenue | $ 50,689 | $ 32,960 | $ 50,689 |
Cash, Cash Equivalents, and R_3
Cash, Cash Equivalents, and Restricted Cash - Summary of Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Cash, Cash Equivalents, and Restricted Cash | |||
Cash denominated in United States dollars | $ 16,344 | $ 102,560 | |
Cash denominated in currency other than United States dollars | 2,562 | 2,133 | |
Restricted cash | 751 | 751 | |
Credit and debit card receivables | 132 | 813 | |
Total cash, cash equivalents and restricted cash | $ 19,789 | $ 106,257 | $ 90,502 |
Cash, Cash Equivalents, and R_4
Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Cash, Cash Equivalents, and Restricted Cash | ||
Deposits in excess of FDIC limits | $ 16,069 | $ 103,339 |
Amount of cash in overseas accounts | $ 2,562 | $ 2,113 |
Other Current Assets - Schedule
Other Current Assets - Schedule of Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Other Current Assets | ||
Prepaid expenses | $ 1,074 | $ 1,047 |
Other | 48 | 48 |
Total other current assets | $ 1,122 | $ 1,095 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Property and equipment, Gross | $ 10,666 | $ 13,398 |
Accumulated depreciation | (7,000) | (6,740) |
Total property and equipment, net | 3,666 | 6,658 |
Impairment on property and equipment | 4,559 | 68 |
Depreciation expense | 3,663 | 2,754 |
Leasehold improvements [Member] | ||
Property and equipment, Gross | $ 8,692 | 11,225 |
Leasehold improvements [Member] | Minimum [Member] | ||
Property and equipment, useful life | 5 years | |
Leasehold improvements [Member] | Maximum [Member] | ||
Property and equipment, useful life | 8 years | |
Furniture and fixtures [Member] | ||
Property and equipment, Gross | $ 1,214 | 1,146 |
Furniture and fixtures [Member] | Minimum [Member] | ||
Property and equipment, useful life | 3 years | |
Furniture and fixtures [Member] | Maximum [Member] | ||
Property and equipment, useful life | 4 years | |
Other operating equipment [Member] | ||
Property and equipment, Gross | $ 760 | $ 1,027 |
Other operating equipment [Member] | Maximum [Member] | ||
Property and equipment, useful life | 5 years |
Other Assets - Consolidated Bal
Other Assets - Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Equity investments | $ 104 | $ 722 |
Lease deposits | 1,973 | 2,030 |
Other | 292 | 58 |
Other assets | $ 2,369 | $ 2,810 |
Other Assets (Details)
Other Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Security deposits | $ 1,973 | $ 2,030 |
Other nonoperating income expense | ||
Unrealized loss on remeasurement of common stock and/or warrants | 618 | 1,046 |
Route1 Inc | ||
Fair value of the investment | $ 104 | $ 722 |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 6,352 | $ 5,341 |
Accumulated Amortization | (2,344) | (1,609) |
Net Carrying Amount | 4,008 | 3,732 |
Trade names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 302 | 1,339 |
Accumulated Amortization | (24) | (1,118) |
Net Carrying Amount | 278 | 221 |
Customer relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,510 | |
Accumulated Amortization | (542) | |
Net Carrying Amount | 968 | |
Software [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 4,485 | 3,886 |
Accumulated Amortization | (1,761) | (484) |
Net Carrying Amount | 2,724 | 3,402 |
License [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 55 | 116 |
Accumulated Amortization | (17) | (7) |
Net Carrying Amount | $ 38 | $ 109 |
Intangible Assets - Schedule _2
Intangible Assets - Schedule of Finite-Lived Intangible Assets, Amortization Expense (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | ||
2023 | $ 1,503 | |
2024 | 1,462 | |
2025 | 411 | |
2026 | 317 | |
2027 | 77 | |
Thereafter | 238 | |
Total | $ 4,008 | $ 3,732 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | ||
Impairment of intangible assets | $ 110 | $ 0 |
Amortization expense | $ 1,766 | 447 |
Minimum [Member] | HyperPointe | ||
Finite-Lived Intangible Assets [Line Items] | ||
Expected useful lives (in years) | 5 years | |
Maximum [Member] | HyperPointe | ||
Finite-Lived Intangible Assets [Line Items] | ||
Expected useful lives (in years) | 12 years | |
Trade names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Expected useful lives (in years) | 6 years | |
Software [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Impairment of intangible assets | $ 0 | |
Software [Member] | Impairment of long-lived assets | ||
Finite-Lived Intangible Assets [Line Items] | ||
Impairment of intangible assets | $ 110 | |
Software [Member] | Minimum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Expected useful lives (in years) | 3 years | |
Software [Member] | Maximum [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Expected useful lives (in years) | 5 years |
Acquisition of HyperPointe (Det
Acquisition of HyperPointe (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Jan. 14, 2022 | Dec. 31, 2022 | |
Acquisition of Hyperpointe | ||
Issuance of Common Stock on acquisition of gcg Connect, LLC, d/b/a HyperPointe | $ 906 | |
Fair value of assets acquired and liabilities assumed | ||
Goodwill | $ 4,024 | |
HyperPointe | ||
Acquisition of Hyperpointe | ||
Payments to acquire business | $ 7,121 | |
Settlement of intercompany accounts payable | $ 770 | |
Shares issuance | 552,487 | |
Issuance of Common Stock on acquisition of gcg Connect, LLC, d/b/a HyperPointe | $ 906 | |
Business acquisition, share price | $ 1.64 | |
Share price | $ 1.81 | |
Additional consideration in cash or shares | $ 7,500 | |
Additional contingent shares issued or issuable | 4,143,647 | |
Consideration paid | $ 7,257 | |
Fair value of assets acquired and liabilities assumed | ||
Cash and cash equivalents | 2,269 | |
Accounts receivable | 346 | |
Unbilled Receivables | 56 | |
Prepaid expenses and other current assets | 19 | |
Other long-term assets | 16 | |
Property and equipment | 68 | |
Accounts payable | (653) | |
Deferred revenue | (723) | |
Total net assets | 3,233 | |
Goodwill | 4,024 | |
HyperPointe | Customer relationships [Member] | ||
Fair value of assets acquired and liabilities assumed | ||
Other intangible assets, net | 1,198 | |
HyperPointe | Trade names [Member] | ||
Fair value of assets acquired and liabilities assumed | ||
Other intangible assets, net | 302 | |
HyperPointe | Software [Member] | ||
Fair value of assets acquired and liabilities assumed | ||
Other intangible assets, net | 335 | |
HyperPointe | Maximum [Member] | ||
Acquisition of Hyperpointe | ||
Potential earnout | $ 7,500 |
Acquisition of HyperPointe - St
Acquisition of HyperPointe - Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Jan. 14, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Acquisition of Hyperpointe | |||
Number of options, granted | 2,350,338 | 1,668,297 | |
HyperPointe | Ezra T. Ernst | Stock Options | |||
Acquisition of Hyperpointe | |||
Number of options, granted | 1,000,000 | ||
Exercise price range, Granted | $ 1.64 | ||
Fair value of options granted | $ 1,457 | ||
Vesting percentage | 33.33% | ||
Options, vesting period | 3 years | ||
Options, expiry period | 10 years |
Acquisition of HyperPointe - Fa
Acquisition of HyperPointe - Fair value assumptions of intangible assets (Details) - Income approach - HyperPointe | Dec. 31, 2022 Y |
Trade name [Member] | Discount rate | |
Acquisition of Hyperpointe | |
Acquired finite lived intangible asset, measurement input | 0.2450 |
Trade name [Member] | Estimated remaining economic life (Years) | |
Acquisition of Hyperpointe | |
Acquired finite lived intangible asset, measurement input | 12 |
Trade name [Member] | Percent of revenue attributable to intangible assets | |
Acquisition of Hyperpointe | |
Acquired finite lived intangible asset, measurement input | 1 |
Trade name [Member] | Royalty rate | |
Acquisition of Hyperpointe | |
Acquired finite lived intangible asset, measurement input | 0.0100 |
Customer relationships [Member] | Attrition rate | |
Acquisition of Hyperpointe | |
Acquired finite lived intangible asset, measurement input | 0.1500 |
Customer relationships [Member] | Existing customer growth | |
Acquisition of Hyperpointe | |
Acquired finite lived intangible asset, measurement input | 0.0300 |
Customer relationships [Member] | Business development expense for new customers | |
Acquisition of Hyperpointe | |
Acquired finite lived intangible asset, measurement input | 0.0050 |
Customer relationships [Member] | Discount rate | |
Acquisition of Hyperpointe | |
Acquired finite lived intangible asset, measurement input | 0.2600 |
Customer relationships [Member] | Estimated remaining economic life (Years) | |
Acquisition of Hyperpointe | |
Acquired finite lived intangible asset, measurement input | 5 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases | ||
Variable lease payments | $ 1,392 | $ 576 |
Operating leases, rent expense | 3,917 | 2,069 |
Impairment expense | $ 1,110 | $ 747 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information Related to Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Leases | ||
Operating cash flows from operating leases | $ (4,092) | $ (4,230) |
Leased assets obtained in exchange for new and modified operating lease liabilities | $ 6,891 | 3,646 |
Leased assets surrendered in exchange for termination of operating lease liabilities | $ 9 |
Leases - Future Minimum Commitm
Leases - Future Minimum Commitments (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Leases | |
2023 | $ 3,479 |
2024 | 3,153 |
2025 | 2,676 |
2026 | 1,618 |
2027 | 1,495 |
Thereafter | 4,389 |
Total future lease payments | 16,810 |
Less: interest expense at incremental borrowing rate | (2,703) |
Net present value of lease liabilities | $ 14,107 |
Leases - Other Assumptions and
Leases - Other Assumptions and Pertinent Information (Details) | Dec. 31, 2022 |
Leases | |
Weighted average remaining lease term (years): | 5 years 11 months 23 days |
Weighted average discount rate used to determine present value of operating lease liability: | 7.69% |
Long-term Notes and Convertib_2
Long-term Notes and Convertible Notes - Paycheck Protection Program (Details) - Paycheck Protection Program - USD ($) $ in Thousands | May 02, 2020 | May 01, 2020 | Dec. 31, 2021 |
Debt Instrument [Line Items] | |||
Debt instrument, face amount | $ 5,653 | ||
Interest rate (as a percent) | 1% | ||
Deferral period | 6 months | ||
Payments on PPP Loan | $ 0 | ||
Debt outstanding | $ 3,584 |
Stockholders' Equity and Warr_3
Stockholders' Equity and Warrants - Schedule of Changes In Warrants Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Warrants [Line Items] | ||
Repurchase and retirement of common stock | $ 23,789 | $ 7,825 |
Minimum [Member] | ||
Warrants [Line Items] | ||
Exercise price range, Expired | $ 1.7 | |
Maximum [Member] | ||
Warrants [Line Items] | ||
Exercise price range, Expired | $ 6.566 | |
Share Repurchase Program | ||
Warrants [Line Items] | ||
Repurchase and retirement of common stock (in shares) | 19,526,706 | 4,702,072 |
Repurchase price | $ 1.22 | $ 1.66 |
Repurchase and retirement of common stock | $ 23,789 | $ 7,825 |
Warrants | ||
Warrants [Line Items] | ||
Outstanding, Opening Balance | 37,817,694 | |
Expired | (36,645,606) | |
Outstanding, Ending Balance | 1,172,088 | 37,817,694 |
Weighted average exercise price, Beginning Balance | $ 2.99 | |
Weighted average exercise price, Expired | 3.02 | |
Weighted average exercise price, Ending Balance | 2 | $ 2.99 |
Warrants | Minimum [Member] | ||
Warrants [Line Items] | ||
Exercise price range, Beginning Balance | 0.525 | |
Exercise price range, Ending Balance | 1.7 | 0.525 |
Warrants | Maximum [Member] | ||
Warrants [Line Items] | ||
Exercise price range, Beginning Balance | 6.566 | |
Exercise price range, Ending Balance | $ 2.125 | $ 6.566 |
Stockholders' Equity and Warr_4
Stockholders' Equity and Warrants - Schedule of Warrants Outstanding (Details) - Outstanding Equity Warrants | 12 Months Ended |
Dec. 31, 2022 $ / shares shares | |
Warrants [Line Items] | |
No. outstanding | 1,172,088 |
January 2021 Placement Agent Warrants [Member] | |
Warrants [Line Items] | |
No. outstanding | 510,588 |
Remaining contractual life | 29 days |
Expiration Date | January 28, 2023 |
Exercise price | $ / shares | $ 2.125 |
January 2021 Placement Agent Tail Fee [Member] | |
Warrants [Line Items] | |
No. outstanding | 35,000 |
Remaining contractual life | 29 days |
Expiration Date | January 28, 2023 |
Exercise price | $ / shares | $ 1.7 |
February 2021 Placement Agent Warrants One[Member] | |
Warrants [Line Items] | |
No. outstanding | 284,000 |
Remaining contractual life | 1 month 13 days |
Expiration Date | February 11, 2023 |
Exercise price | $ / shares | $ 2.125 |
February 2021 Placement Agent Warrants Two[Member] | |
Warrants [Line Items] | |
No. outstanding | 48,000 |
Remaining contractual life | 1 month 17 days |
Expiration Date | February 16, 2023 |
Exercise price | $ / shares | $ 2.125 |
February 2021 Placement Agent Tail Fee [Member] | |
Warrants [Line Items] | |
No. outstanding | 248,500 |
Remaining contractual life | 1 month 13 days |
Expiration Date | February 11, 2023 |
Exercise price | $ / shares | $ 1.7 |
February 2021 Placement Agent Tail Fee One [Member] | |
Warrants [Line Items] | |
No. outstanding | 42,000 |
Remaining contractual life | 1 month 17 days |
Expiration Date | February 16, 2023 |
Exercise price | $ / shares | $ 1.7 |
December 2021 Placement Agent Tail Fee [Member] | |
Warrants [Line Items] | |
No. outstanding | 4,000 |
Remaining contractual life | 11 months 26 days |
Expiration Date | December 27, 2023 |
Exercise price | $ / shares | $ 2.125 |
Stockholders' Equity and Warr_5
Stockholders' Equity and Warrants (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Aug. 16, 2022 | Dec. 31, 2021 | |
Warrants [Line Items] | ||
Threshold value of shares repurchases | $ 1,000 | |
Placement Agent Agreement | ||
Warrants [Line Items] | ||
Cash fees paid | $ 2,162 | |
Palladium Warrants | Placement Agent Agreement | ||
Warrants [Line Items] | ||
Warrants to purchase shares of common stock | 325,500 | |
Warrant exercise price | $ 1.70 | |
H.C.W. Warrants | Placement Agent Agreement | ||
Warrants [Line Items] | ||
Warrants to purchase shares of common stock | 846,588 | |
Warrant exercise price | $ 2.125 | |
December 2020 Warrants | ||
Warrants [Line Items] | ||
Total of warrants exercised | 11,273,529 | |
Gross proceeds | $ 19,245 |
Fair Value Measurements - (Deta
Fair Value Measurements - (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Cost method investments | $ 104 | $ 722 |
Fair Value, Recurring | ||
Fair value of the investment | 104 | 722 |
Assets, fair value | 104 | 722 |
Fair Value, Recurring | Fair Value, Inputs, Level 2 | ||
Fair value of the investment | 104 | 722 |
Assets, fair value | 104 | 722 |
Fair Value, Nonrecurring | ||
Intangible assets | 4,008 | |
Fair Value, Nonrecurring | Fair Value, Inputs, Level 3 | ||
Intangible assets | 4,008 | |
Route1 Inc | ||
Fair value of the investment | 104 | 722 |
Route1 Inc | Fair Value, Recurring | ||
Fair value of the investment | 104 | 722 |
Route1 Inc | Fair Value, Recurring | Fair Value, Inputs, Level 2 | ||
Fair value of the investment | $ 104 | $ 722 |
Stock-based Compensation - Stoc
Stock-based Compensation - Stock-based Compensation (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
Oct. 04, 2022 shares | Sep. 30, 2022 item | Sep. 30, 2020 shares | Dec. 31, 2022 USD ($) shares | Dec. 31, 2021 USD ($) shares | |
Stockholders Equity [Line Items] | |||||
Number of equal quarterly vesting installments | item | 4 | ||||
Stock-based compensation expense | $ | $ 3,770 | $ 2,856 | |||
Number of options, granted | 2,350,338 | 1,668,297 | |||
Weighted average remaining contractual term | 7 years 9 months 29 days | 8 years 8 months 15 days | |||
Aggregate Intrinsic Value of Options Outstanding and Vested | $ | $ 0 | $ 545 | |||
Stock Compensation Plan | |||||
Stockholders Equity [Line Items] | |||||
Options, expiry period | 10 years | ||||
Options, vesting period | 1 year | ||||
RSUs | |||||
Stockholders Equity [Line Items] | |||||
Number of options, granted | 531,250 | 1,349,167 | |||
Non-vested Stock Options | |||||
Stockholders Equity [Line Items] | |||||
Unrecognized stock-based payment cost | $ | $ 2,506 | $ 2,088 | |||
Non-Vested RSUs | |||||
Stockholders Equity [Line Items] | |||||
Unrecognized stock-based payment cost | $ | $ 183 | $ 978 | |||
2020 Plan [Member] | |||||
Stockholders Equity [Line Items] | |||||
Number of shares authorized | 7,500,000 | 12,500,000 | |||
Maximum [Member] | 2020 Plan [Member] | |||||
Stockholders Equity [Line Items] | |||||
Number of shares authorized | 5,000,000 | ||||
Number of stock shares issued | 7,396,691 | ||||
Directors, Employees And Consultants | XpresTest 2020 Plan [Member] | |||||
Stockholders Equity [Line Items] | |||||
Number of shares authorized | 200 | ||||
Percentage of shares authorized for issuance | 20% |
Stock-based Compensation - Vari
Stock-based Compensation - Variables Used in Estimating Fair Value of Stock Options (Details) | 12 Months Ended |
Dec. 31, 2022 $ / shares | |
Stock Options | |
Stockholders Equity [Line Items] | |
Expected volatility Minimum: | 119.41% |
Expected volatility Maximum: | 123.45% |
Expected dividend yield: | 0% |
Annual average risk-free rate Minimum: | 1.62% |
Annual average risk-free rate Maximum: | 4.14% |
Minimum [Member] | |
Stockholders Equity [Line Items] | |
Expected term: | 6 years 4 months 28 days |
Minimum [Member] | Stock Options | |
Stockholders Equity [Line Items] | |
Share price of the Company's Common Stock on the grant date: | $ 0.65 |
Exercise price: | $ 0.65 |
Maximum [Member] | |
Stockholders Equity [Line Items] | |
Expected term: | 6 years 5 months 4 days |
Maximum [Member] | Stock Options | |
Stockholders Equity [Line Items] | |
Share price of the Company's Common Stock on the grant date: | $ 1.64 |
Exercise price: | $ 1.64 |
Stock-based Compensation - St_2
Stock-based Compensation - Stock Options and RSU Activity (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Stockholders Equity [Line Items] | ||
No. of options, Outstanding, Beginning balance | 2,826,871 | 1,353,888 |
No. of options, Granted | 2,350,338 | 1,668,297 |
No. of options, Exercised/Vested | 0 | (8,334) |
No. of options, Forfeited | (245,027) | (183,230) |
No. of options, Expired | (102,153) | (3,750) |
No. of options, Outstanding, Ending balance | 4,830,029 | 2,826,871 |
No. of options, Exercisable | 2,061,259 | 1,024,694 |
Weighted average grant date fair value, Beginning balance | $ 2.57 | $ 3.82 |
Weighted average grant date fair value, Granted | 1.46 | 1.56 |
Weighted average grant date fair value, Exercised/Vested | 0 | 1.53 |
Weighted average grant date fair value, Forfeited | 1.55 | 1.61 |
Weighted average grant date fair value, Expired | 6.05 | 50.8 |
Weighted average grant date fair value, Ending balance | 2 | 2.57 |
Weighted average grant date fair value, Exercisable | $ 2.56 | $ 3.81 |
RSUs | ||
Stockholders Equity [Line Items] | ||
No. of options, Outstanding, Beginning balance | 600,000 | |
No. of options, Granted | 531,250 | 1,349,167 |
No. of options, Exercised/Vested | (850,000) | (749,167) |
No. of options, Forfeited | 0 | |
No. of options, Expired | 0 | |
No. of options, Outstanding, Ending balance | 281,250 | 600,000 |
Weighted average grant date fair value, Beginning balance | $ 1.63 | |
Weighted average grant date fair value, Granted | 0.84 | $ 1.58 |
Weighted average grant date fair value, Exercised/Vested | 1.46 | 1.54 |
Weighted average grant date fair value, Forfeited | 0 | |
Weighted average grant date fair value, Expired | 0 | |
Weighted average grant date fair value, Ending balance | $ 0.65 | $ 1.63 |
XpresTest RSAs | ||
Stockholders Equity [Line Items] | ||
No. of options, Outstanding, Beginning balance | 28.75 | |
No. of options, Granted | 15 | 120 |
No. of options, Exercised/Vested | (10) | (148.75) |
No. of options, Outstanding, Ending balance | 5 | |
Weighted average grant date fair value, Beginning balance | $ 11,390.35 | |
Weighted average grant date fair value, Granted | $ 56,890 | 5,227.20 |
Weighted average grant date fair value, Exercised/Vested | 61,550 | 6,418.40 |
Weighted average grant date fair value, Ending balance | 47,570 | |
Minimum [Member] | ||
Stockholders Equity [Line Items] | ||
Exercise price range, Outstanding, Beginning balance | 1.19 | 1.53 |
Exercise price range, Granted | 0.65 | 1.19 |
Exercise price range, Forfeited | 1.43 | |
Exercise price range, Expired | 1.44 | |
Exercise price range, Outstanding, Ending balance | 0.65 | 1.19 |
Exercise price range, Exercisable | 1.19 | 1.19 |
Maximum [Member] | ||
Stockholders Equity [Line Items] | ||
Exercise price range, Outstanding, Beginning balance | 2,460 | |
Exercise price range, Granted | 1.64 | 1.61 |
Exercise price range, Forfeited | 3.82 | |
Exercise price range, Expired | 2,232 | |
Exercise price range, Outstanding, Ending balance | 2,460 | 2,460 |
Exercise price range, Exercisable | $ 2,460 | $ 2,460 |
Segment Information - Geographi
Segment Information - Geographical Revenue, Segment Operating Loss and Total Asset Information (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 USD ($) segment location | Dec. 31, 2021 USD ($) | |
Revenue | ||
Total revenue | $ 55,939 | $ 73,729 |
Operating (loss) income | ||
Total operating income (loss) | (31,163) | 4,107 |
Depreciation & Amortization | 5,429 | 3,201 |
Capital Expenditures | 6,293 | 8,671 |
Assets | ||
Total long-lived assets | 18,794 | 14,497 |
Total assets | $ 70,426 | 127,266 |
Number of reportable segments | segment | 4 | |
Number of locations operated | location | 2 | |
XpresSpa | ||
Revenue | ||
Total revenue | $ 13,680 | 4,614 |
Operating (loss) income | ||
Total operating income (loss) | (12,910) | (9,617) |
Depreciation & Amortization | 1,479 | 1,281 |
Capital Expenditures | 2,134 | 908 |
Assets | ||
Total long-lived assets | 11,851 | 8,419 |
Total assets | 21,135 | 12,351 |
XpresTest | ||
Revenue | ||
Total revenue | 38,523 | 69,078 |
Operating (loss) income | ||
Total operating income (loss) | 2,403 | 25,452 |
Depreciation & Amortization | 1,711 | 1,858 |
Capital Expenditures | 775 | 1,723 |
Assets | ||
Total long-lived assets | 112 | 2,246 |
Total assets | 4,285 | 19,349 |
Treat | ||
Revenue | ||
Total revenue | 1,392 | 37 |
Operating (loss) income | ||
Total operating income (loss) | (10,577) | (5,735) |
Depreciation & Amortization | 1,876 | 50 |
Capital Expenditures | 3,274 | 5,904 |
Assets | ||
Total long-lived assets | 2,314 | 2,700 |
Total assets | 3,186 | 5,918 |
HyperPointe | ||
Revenue | ||
Total revenue | 2,344 | |
Operating (loss) income | ||
Total operating income (loss) | (1,165) | |
Depreciation & Amortization | 332 | |
Assets | ||
Total long-lived assets | 4,108 | |
Total assets | 6,913 | |
Corporate and Other | ||
Operating (loss) income | ||
Total operating income (loss) | (8,914) | (5,993) |
Depreciation & Amortization | 31 | 12 |
Capital Expenditures | 110 | 136 |
Assets | ||
Total long-lived assets | 409 | 1,132 |
Total assets | 34,907 | 89,648 |
United States | ||
Revenue | ||
Total revenue | 52,250 | 71,114 |
Assets | ||
Total long-lived assets | 15,084 | 9,698 |
All other countries | ||
Revenue | ||
Total revenue | 3,689 | 2,615 |
Assets | ||
Total long-lived assets | $ 3,710 | $ 4,799 |
Segment Information - Additiona
Segment Information - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Accrued Expenses And Other Current Liabilities [Line Items] | ||
Impairment of long-lived assets | $ 4,669 | $ 68 |
Impairment of operating lease right-of-use assets | 1,110 | 747 |
XpresSpa | ||
Accrued Expenses And Other Current Liabilities [Line Items] | ||
Impairment of long-lived assets | 619 | |
Impairment of operating lease right-of-use assets | 936 | |
Treat Segment | ||
Accrued Expenses And Other Current Liabilities [Line Items] | ||
Impairment of long-lived assets | 3,373 | |
Impairment of operating lease right-of-use assets | 136 | |
XpresTest | ||
Accrued Expenses And Other Current Liabilities [Line Items] | ||
Impairment of long-lived assets | $ 677 | |
Impairment of operating lease right-of-use assets | $ 38 | |
Customer Concentration Risk [Member] | Net Sales | Customers A [Member] | HyperPointe | ||
Accrued Expenses And Other Current Liabilities [Line Items] | ||
Concentration risk, percentage | 55% | |
Customer Concentration Risk [Member] | Net Sales | Customers B [Member] | HyperPointe | ||
Accrued Expenses And Other Current Liabilities [Line Items] | ||
Concentration risk, percentage | 33% | |
Customer Concentration Risk [Member] | Net Sales | Customers C [Member] | HyperPointe | ||
Accrued Expenses And Other Current Liabilities [Line Items] | ||
Concentration risk, percentage | 10% | |
Customer Concentration Risk [Member] | Net Sales | Customers E [Member] | XpresTest | ||
Accrued Expenses And Other Current Liabilities [Line Items] | ||
Concentration risk, percentage | 10% | |
Customer Concentration Risk [Member] | Accounts Receivable | Customers A [Member] | HyperPointe | ||
Accrued Expenses And Other Current Liabilities [Line Items] | ||
Concentration risk, percentage | 55% | |
Customer Concentration Risk [Member] | Accounts Receivable | Customers D [Member] | HyperPointe | ||
Accrued Expenses And Other Current Liabilities [Line Items] | ||
Concentration risk, percentage | 27% | |
Customer Concentration Risk [Member] | Accounts Receivable | Customers F [Member] | ||
Accrued Expenses And Other Current Liabilities [Line Items] | ||
Concentration risk, percentage | 92% | |
Customer Concentration Risk [Member] | Accounts Receivable | Customers F [Member] | XpresTest | ||
Accrued Expenses And Other Current Liabilities [Line Items] | ||
Concentration risk, percentage | 99% |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities (Schedule of Accrued Expenses and Other Current Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Accrued Expenses and Other Current Liabilities | ||
Litigation accrual | $ 963 | $ 845 |
Accrued compensation | 2,008 | 2,862 |
Tax-related liabilities | 573 | 603 |
Common area maintenance accruals | 160 | |
AP Accruals | 754 | 431 |
Gift certificates | 496 | 494 |
Construction accrual | 930 | |
Credit card processing fees | 33 | 501 |
Other miscellaneous accruals | 732 | 757 |
Total accounts payable, accrued expenses and other current liabilities | $ 5,719 | $ 7,423 |
Income Taxes - Components of Lo
Income Taxes - Components of Loss Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Taxes. | ||
Domestic | $ (32,445) | $ 3,137 |
Foreign | (129) | (188) |
Total | $ (32,574) | $ 2,949 |
Income Taxes - Income Tax Benef
Income Taxes - Income Tax Benefit (Expense) Attributable to the Operating Loss (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Current: | ||
Federal | $ 0 | $ 0 |
State | 41 | 56 |
Foreign | 14 | 0 |
Deferred: | ||
Federal | 0 | 0 |
Total | $ 55 | $ 56 |
Income Taxes - Income Tax Ben_2
Income Taxes - Income Tax Benefit (Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Taxes. | ||
Income (loss) from operations before income taxes | $ (32,574) | $ 2,949 |
Tax rate | 21% | 21% |
Computed "expected" tax benefit | $ (6,841) | $ 619 |
State taxes, net of federal income tax benefit | 706 | 1,516 |
Change in valuation allowance | 7,014 | (10,946) |
Adjustment JV Basis | 339 | 4,445 |
Nondeductible expenses | 341 | 1,104 |
Return to Provision Adjustment | (94) | 2,403 |
State Deferred Rate Change | (570) | |
Asset Impairment Adjustment | (810) | |
Other items | (31) | 915 |
Income tax expense | $ 55 | $ 56 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets (Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred income tax assets | |||
Net operating loss carryforwards | $ 51,932 | $ 48,556 | |
Stock-based compensation | 1,029 | 507 | |
Intangible assets and other | 7,298 | 4,235 | |
Net deferred income tax assets | 60,259 | 53,298 | |
Less: | |||
Valuation allowance | $ (60,259) | $ (53,298) | $ (64,245) |
Income Taxes - Changes to Valua
Income Taxes - Changes to Valuation Allowance (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Income Taxes [Line Items] | ||
Beginning Balance | $ 53,298 | $ 64,245 |
Return to provision true-up and other | 97 | (2,403) |
Ending Balance | 60,259 | 53,298 |
Continuing Operations [Member] | ||
Income Taxes [Line Items] | ||
Charged to cost and expenses | $ 6,864 | $ (8,544) |
Income Taxes (Details)
Income Taxes (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2021 USD ($) | |
Income Taxes. | |
Operating loss carryforwards | $ 150,926 |
Expiring period | 20 years |
Operating loss carry forwards without limitation | $ 75,045 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | 12 Months Ended | |||
May 26, 2020 USD ($) employee | Dec. 31, 2022 USD ($) | Sep. 20, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Kyle Collins | ||||
Loss Contingencies [Line Items] | ||||
Penalties per employee per pay period | $ 0.1 | |||
Number of current and former employees | employee | 240 | |||
Kyle Collins | Settled litigation | ||||
Loss Contingencies [Line Items] | ||||
Settlement amount | $ 513,000 | |||
Additional payroll tax | $ 4,000 | |||
Accrued settlement amount | $ 517,000 | |||
OTG Management PHL B [Member] | ||||
Loss Contingencies [Line Items] | ||||
Lease term | 12 years | |||
Accounts payable, accrued expenses and other. | ||||
Loss Contingencies [Line Items] | ||||
Estimated litigation liability, current | $ 963,000 | $ 845,000 | ||
Maximum [Member] | OTG Management PHL B [Member] | ||||
Loss Contingencies [Line Items] | ||||
Loss contingency damages sought | 2,250,000 | |||
Minimum [Member] | OTG Management PHL B [Member] | ||||
Loss Contingencies [Line Items] | ||||
Loss contingency damages sought | $ 864,000 |