UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 10-Q/A

(Amendment No. 1)

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

For the quarterly period ended March 31, 2024

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

For the transition period from __________ to __________

Commission File Number: 001-41473

LUXURBAN HOTELS INC.

(Exact name of registrant as specified in its charter)

Delaware		82-3334945
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification Number)

2125 Biscayne Blvd Suite 253 Miami, Florida 33137		33137
(Address of principal executive offices)		(Zip code)

(833)-723-7368
(Registrant’s telephone number including area code)

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

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common stock, $0.00001 par value per share	LUXH	Nasdaq Stock Market LLC
13.00% Series A Cumulative Redeemable Preferred Stock, $0.00001 par value per share	LUXHP	Nasdaq Stock Market LLC

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

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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

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

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

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

As of August 20, 2024, the registrant had 123,400,956 shares of common stock, $.00001 par value, outstanding.

Explanatory Note

LuxUrban Hotels Inc. (the “Company”) is filing this Amendment No.1 on Form 10-Q/A for the quarter ended March 31, 2024 (this “Form 10-Q/A”).

This Form 10-Q/A amends the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2024, as filed with the Securities and Exchange Commission (“SEC”) on May 13, 2024 (the “Original Filing”). This Form 10-Q/A is being filed to restate the Company’s unaudited condensed consolidated financial statements for the three months ended March 31, 2024. The restatement reflects applying charges allocated by the Channel Retained Funds of the security, deposited by the Company and expensing them to other expenses category in cost of goods sold. The restatement provides a reserve for bad debt expense for Processor Retained Funds, Receivable from On-Line Travel Agencies and the Receivable from the City of New York and Landlords reducing those assets and increasing bad debt expense in General and Administrative Expenses. The restatement reflects the adjustment for the proposed settlement with the landlord for the receivable due from the City of New York. The restatement reflects the amortization of prepaid real estate taxes which reduced Prepaid Expenses and Other Current Assets and increased real estate taxes included in Other Expenses, Cost of Revenue. The restatement reflects the increase in liability of the Bookings Received in Advance and reduces the Net Rental Revenue. The restatement also adjusts for the cancelation of reservations by a merchant service provider reducing Net Rental Revenue and decreasing receivables from On-Line Travel Agencies and increasing accrued expenses liability for the amount due the guests. The restatement reflects the reversal of revenue for the three months ended March 31, 2024, caused by the transfer from one merchant service provider to another merchant service provider. These adjustments were evaluated by management in accordance with SEC Staff Accounting Bulletin Topic 1M, “Materiality” and management determined the effects of the restatement to be material. See Note 2 to the unaudited condensed consolidated financial statements included in this Form 10-Q/A for further information regarding the restatement.

The Company is filing this Form 10-Q/A to amend and restate the Original Filing with modification as necessary to reflect the restatement. The following items have been amended to reflect the restatement:

Part I, Item 1:

Part I, Item 2:

Part II, Item 1A:

In addition, the Company’s Chief Executive Officer and Chief Financial Officer have provided new certifications dated as of the date of this Form 10-Q/A (Exhibits 31.1, 31.2, 32.1 and 32.2).

Except as otherwise described above and as otherwise set forth in this Form 10-Q/A, this Form 10-Q/A does not amend, modify or update any other information contained in the Original Filing. This Form 10-Q/A does not purport to reflect any information or events subsequent to the Original Filing, except as expressly described herein. Accordingly, this Form 10-Q/A should be read in conjunction with our filings made with the SEC subsequent to the filing of the Original Filing. Among other things, forward-looking statements and risk factor disclosure in the Original 10-Q have not been revised to reflect events that occurred or facts that became known to the Company after the filing of the Original Filing, and such forward-looking statements and risk factors should be read in their historical context.

Table of Contents

Part I - Financial Information		1

Item 1 - Financial Statements		1

LUXURBAN HOTELS INC. CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (AS RESTATED)		1

LUXURBAN HOTELS INC. CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED) (AS RESTATED)		2

LUXURBAN HOTELS INC. CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT (UNAUDITED) (AS RESTATED)		3

LUXURBAN HOTELS INC. CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 2024 AND MARCH 31, 2023 (UNAUDITED) (AS RESTATED)		4

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS LUXURBAN HOTELS INC. March 31, 2024 (AS RESTATED)		5

Item 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		26

Item 3 - Quantitative and Qualitative Disclosures About Market Risk		47

Item 4 - Controls and Procedures		48

Part II - Other Information		49

Item 1 - Legal Proceedings		49

Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds		50

Item 3 - Defaults Upon Senior Securities		50

Item 4 - Mine Safety Disclosures		50

Item 5 - Other Information		51

Item 6 - Exhibits		53

SIGNATURES		57

Part I - Financial Information

Item 1 - Financial Statements.

LUXURBAN HOTELS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)


	March 31,
	2024, as restated			December 31, 2023
ASSETS
Current Assets
Cash and Cash Equivalents	$	994,904		$	752,848
Accounts Receivable, Net		486,067			329,887
Channel Retained Funds, Net		-			1,500,000
Processor Retained Funds, Net		-			2,633,926
Receivables from On-Line Travel Agencies, Net		-			6,936,254
Receivables from City of New York and Landlords, Net		1,831,651			4,585,370
Prepaid Expenses and Other Current Assets		1,018,902			1,959,022
Prepaid Guarantee Trust - Related Party		672,750			1,023,750
Total Current Assets		5,004,274			19,721,057
Other Assets
Furniture, Equipment and Leasehold Improvements, Net		677,559			691,235
Security Deposits - Noncurrent		20,607,413			20,307,413
Prepaid Expenses and Other Noncurrent Assets		5,974,276			960,729
Operating Lease Right-Of-Use Assets, Net		229,016,100			241,613,588
Total Other Assets		256,275,348			263,572,965
Total Assets	$	261,279,622		$	283,294,022

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
Accounts Payable and Accrued Expenses	$	30,779,912		$	23,182,305
Bookings Received in Advance		14,626,651			4,404,216
Short Term Business Financing, Net		3,733,417			1,115,120
Loans Payable - Current		1,666,108			1,654,589
Initial Direct Costs Leases - Current		300,000			486,390
Operating Lease Liabilities - Current		1,944,026			1,982,281
Development Incentive Advances - Current		8,893,987			300,840
Total Current Liabilities		61,944,101			33,125,741
Long-Term Liabilities
Loans Payable		1,447,720			1,459,172
Development Incentive Advances - Noncurrent		-			5,667,857
Initial Direct Costs Leases - Noncurrent		3,950,000			4,050,000
Operating Lease Liabilities - Noncurrent		231,815,657			242,488,610
Total Long-Term Liabilities		237,213,377			253,665,639
Total Liabilities		299,157,478			286,791,380
Mezzanine equity
13% Redeemable Preferred Stock; Liquidation Preference $25 per Share; 10,000,000 Shares Authorized; 294,144 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively		5,775,596			5,775,596
Commitments and Contingencies
Stockholders’ Deficit
Common Stock (shares authorized, issued, outstanding - 41,839,361, and 39,462,440, shares outstanding as of March 31, 2024 and December 31, 2023, respectively)		418			394
Additional Paid In Capital		98,455,107			90,437,155
Accumulated Deficit		(142,108,977	)		(99,710,503	)
Total Stockholders’ Deficit		(43,653,452	)		(9,272,954	)
Total Liabilities and Stockholders’ Deficit	$	261,279,622		$	283,294,022

See accompanying notes to condensed consolidated financial statements.

LUXURBAN HOTELS INC.

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

(UNAUDITED)


	For The
	Three Months Ended
	March 31,
	2024, as restated			2023
Net Rental Revenue	$	13,957,361		$	22,814,175
Rent Expense		8,344,007			5,421,867
Non-Cash Rent Expense Amortization		2,093,667			1,651,669
Surrender of Deposits		750,000			-
Other Expenses		24,350,623			10,378,765
Total Cost of Revenue		35,538,297			17,452,301
Gross (Loss) Profit		(21,580,936	)		5,361,874
General and Administrative Expenses		12,143,305			2,742,586
Non-Cash Issuance of Common Stock for Operating Expenses		304,925			884,816
Non-Cash Stock Compensation Expense		724,514			429,996
Non-Cash Stock Option Expense		152,339			167,573
Partnership Considerations		2,679,469			-
Total Operating Expenses		16,004,552			4,224,971
(Loss) Income from Operations		(37,585,488	)		1,136,903
Other Income (Expense)
Other Income		210,076			39,878
Cash Interest and Financing Costs		(2,459,800	)		(2,130,605	)
Non-Cash Financing Costs		(2,324,270	)		(1,704,549	)
Total Other Expense		(4,573,994	)		(3,795,276	)
Loss Before Provision for Income Taxes		(42,159,482	)		(2,658,373	)
Provision for Income Taxes		-			122,161
Net Loss		(42,159,482	)		(2,780,534	)
Preferred Stock Dividend		(238,992	)		-
Net Loss Attributable to Common Stockholders	$	(42,398,474	)	$	(2,780,534	)
Basic Loss Per Common Share	$	(0.87	)	$	(0.10	)
Diluted Loss Per Common Share	$	(0.87	)	$	(0.10	)
Basic and Diluted Weighted Average Number of Common Shares Outstanding		49,223,606			28,659,358

See accompanying notes to condensed consolidated financial statements.

LUXURBAN HOTELS INC.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ DEFICIT

FOR THE THREE MONTHS ENDED MARCH 31, 2024 AND MARCH 31, 2023

(UNAUDTIED)


	Common Stock				Additional Paid in			Accumulated			Stockholders’
	Shares		Value		Capital			Deficit			(Deficit)
Balance - December 31, 2023		39,462,440	$	394	$	90,437,155		$	(99,710,503	)	$	(9,272,954	)
Net Loss		-		-		-			(42,159,482	)		(42,159,482	)
Non-Cash Stock Compensation Expense		222,800		2		633,074						633,076
Non-Cash Option Compensation Expense		-		-		152,339			-			152,339
Issuance of Shares for Operating Expenses		69,863		1		304,925			-			304,926
Modification of Warrants		-		-		2,036,200			-			2,036,200
Warrant Exercise		1,450,000		15		4,799,985			-			4,800,000
Issuance of Shares to Satisfy Loans		20,008		-		91,435			-			91,435
Issuance of Shares for Revenue Share Agreements		614,250		6		(6	)		-			-
Preferred Dividends		-		-		-			(238,992	)		(238,992	)
Balance - March 31, 2024, as restated		41,839,361	$	418	$	98,455,107		$	(142,108,977	)	$	(43,653,452	)

Balance - December 31, 2022		27,691,918	$	276	$	17,726,592		$	(21,018,992	)	$	(3,292,124	)
Net Loss		-		-		-			(2,780,534	)		(2,780,534	)
Non-Cash Stock Compensation Expense		166,665		2		429,994			-			429,996
Non-Cash Stock Option Expense		-		-		167,573			-			167,573
Issuance of Shares for Operating Expenses		433,881		4		884,812			-			884,816
Conversion of Loans		900,000		9		2,699,991			-			2,700,000
Warrant Exercise		200,000		2		399,998			-			400,000
Loss on Debt Extinguishment		-		-		58,579			-			58,579
Balance - March 31, 2023		29,392,464	$	293	$	22,367,539		$	(23,799,526	)	$	(1,431,694	)

See accompanying notes to consolidated financial statements.

LUXURBAN HOTELS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2024 AND MARCH 31, 2023

(UNAUDITED)


	March 31,
	2024, as restated			2023
Cash Flows from Operating Activities
Net Loss	$	(42,159,482	)	$	(2,780,534	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Writeoff of bad debts		7,843,456			-
Writeoff of channel retained funds security deposit		1,500,000			-
Writeoff of security deposits		750,000			-
Writeoff of vendor overpayment		50,000			-
Non-cash stock compensation expense		55,500			429,996
Non-cash stock director expense		577,576			-
Non-cash stock option expense		152,339			167,573
Depreciation expense		13,676			11,031
Shares issued for operating expenses		304,926			884,816
Modification of Warrants		2,036,200			-
Non-cash lease expense		10,146,639			6,456,386
Gain on lease exit		(209,811	)		-
Non-cash forgiveness of Development Incentive Advances		(75,210	)
Gain on sale of Treasury Bills		-			(31,014	)
Non-cash Financing Charges Associated with Short Term Business Financing		286,576			78,402
Loss on Debt Extinguishment		-			58,579
Changes in operating assets and liabilities:

Amendment: SEC Form 10-Q/A filed by LuxUrban Hotels Inc.