Form 10-Q/A - Quarterly report [Sections 13 or 15(d)]: [Amend]

Share Name	Share Symbol	Market	Type
LuxUrban Hotels Inc	NASDAQ:LUXH	NASDAQ	Common Stock

	Price Change	% Change	Share Price	Bid Price	Offer Price	High Price	Low Price	Open Price	Shares Traded	Last Trade
	0.03	1.97%	1.55	1.50	1.55				5,545	13:14:07

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:
(Increase) Decrease in:
Accounts Receivable, Net		(156,180	)		-
Processor retained funds		-			(218,023	)
Receivables from On-Line Travel Agencies, Net		2,711,468			-
Receivables from City of New York and Landlords, Net		1,768,975			-
Prepaid expense and other assets		(4,073,427	)		261,157
Prepaid Guarantee Trust - Related Party		351,000			-
Security deposits		(1,050,000	)		(3,907,720	)
(Decrease) Increase in:
Accounts payable and accrued expenses		7,547,607			1,024,948
Operating lease liabilities		(8,050,548	)		(4,804,716	)
Rents received in advance		10,222,435			2,630,239
Accrued Income Taxes		-			122,161
Net cash (used in) provided by operating activities		(9,456,285	)		383,281

Cash Flows from Investing Activities
Purchase of Furniture and Equipment		-			(249,762	)
Proceeds from the sale of Treasury Bills		-			2,692,396
Net cash provided by investing activities		-			2,442,634

Cash Flows from Financing Activities
Deferred offering costs - net
Proceeds from (Repayments of) short term business financing - net		2,331,721			(1,255,512	)
Warrant Exercises		4,800,000			400,000
Proceeds from Development Incentive Advances		3,000,500			-
Proceeds from (Repayments of) loans payable - net		67			(165,896	)
Repayments of financed initial direct costs		(194,955	)		-
Preferred shareholder dividends paid		(238,992	)		-
Net cash provided by (used in) financing activities		9,698,341			(1,021,408	)

Net Increase in Cash and Cash Equivalents and Restricted Cash		242,056			1,804,507
Cash and Cash Equivalents and Restricted Cash - beginning of the period		752,848			2,176,402
Cash and Cash Equivalents and Restricted Cash - end of the period		994,904			3,980,909

Cash and Cash Equivalents		994,904			2,880,909
Restricted Cash		-			1,100,000
Total Cash and Cash Equivalents and Restricted Cash	$	994,904		$	3,980,909

Supplemental Disclosures of Cash Flow Information
Taxes	$	-		$	-
Interest	$	1,598,784		$	2,130,605
Noncash operating activities:
Acquisition of New Operating Lease Right-of-Use Assets	$	-		$	88,267,775
Noncash financing activities:
Financed Initial Direct Costs for leases paid with common stock	$	91,435		$	-
Conversion of debt to common stock and additional paid-in capital	$	-		$	2,700,000

See accompanying notes to condensed consolidated financial statements.

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

1 - DESCRIPTION OF BUSINESS AND PRINCIPLES OF CONSOLIDATION

LuxUrban Hotels Inc. (LUXH) leases entire existing hotels on a long-term basis and rents out hotel rooms in the properties it leases. It currently has a portfolio of hotel rooms in New York, Miami Beach, New Orleans, and Los Angeles through long-term lease agreements and manages these hotels directly. Its revenues are generated through the rental of rooms to guests and through ancillary services such as cancellable room rate fees, resort fees, late and early check-in and check-out fees, baggage fees, parking fees, grab and go food service fees, and upgrade fees.

In late 2021, LUXH commenced the process of winding down its legacy business of leasing and re-leasing multifamily residential units, as it pivoted toward its new strategy of leasing hotels. This wind-down was substantially completed by the end of 2022. This legacy business was conducted under the names SoBeNY Partners LLC (“SoBeNY”) and CorpHousing Group Inc. (“CorpHousing”).

The consolidated financial statements presented herein include the accounts of LuxUrban Hotels Inc. (“LuxUrban”) and its wholly owned subsidiary SoBeNY. On November 2, 2022, CorpHousing changed its name to LuxUrban Hotels Inc. In June 2021, the members of SoBeNY exchanged all of their membership interests for additional membership interests in Corphousing LLC, with SoBeNY becoming a wholly owned subsidiary of Corphousing LLC. Both entities were under common control at the time of the transaction. Since there was no change in control over the net assets, there is no change in basis in the net assets.

In January 2022, Corphousing LLC and its wholly owned subsidiary, SoBeNY, converted into C corporations, with the then current members of Corphousing LLC becoming the stockholders of the newly formed C corporation, CorpHousing Group Inc. The conversion has no effect on our business or operations and was undertaken to convert the forms of these legal entities into corporations for purposes of operating as a public company. All properties, rights, businesses, operations, duties, obligations and liabilities of the predecessor limited liability companies remain those of CorpHousing Group Inc. and SoBeNY Partners Inc.

In August 2023, the Company entered into franchise agreements with Wyndham Hotels & Resorts, Inc. pursuant to which the hotels operated by the Company were to become part of the Trademark Collection^® by Wyndham and Travelodge by Wyndham brands while staying under the operational control of the Company.

In May 2024, in light of discussions between our Company and Wyndham on the initial and projected future performance of our properties within the franchise relationships, we commenced the return of all property listings to our control, terminating our franchise relationship with Wyndham. The Company is currently in the process of de-platforming these properties from Wyndham’s systems and moving each hotel listing back under the Company’s control. The Company expects that this process will be completed by the end of May 2024 with minimal operational disruption, although unforeseen risks could cause delays. As part of the Company’s previously announced imitative to add industry depth and breadth to its board of directors and management to help evolve operations, the Company’s enhanced board and executive teams have reviewed all existing operational relationships. Given the Company’s operating model, it was concluded that over the long term the Company would be better served operationally and financially by operating the hotels as an independent operator.

All significant intercompany accounts and transactions have been eliminated in consolidation.

2 - RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

On August 9, 2024, the Company in concurrence with the Company’s audit committee, concluded that our 2024 unaudited condensed consolidated financial statements as of the first quarterly period in 2024 included in our Quarterly Report on Form 10-Q for the respective period, (the “Prior Period Financial Statements”) should no longer be relied upon due to misstatements that are described below, and that we would restate such financial statements to make the necessary accounting corrections. Details of the restated condensed consolidated financial statements for the three months ended March 31, 2024, are provided below (“Restatement Items”).

The Restatement Items reflect adjustments to correct errors in the March 31, 2024, condensed consolidated financial statement areas including Channel Retained Funds, Other Expenses, Bookings Received in Advance and Net Rental Revenue. The nature and impact of these adjustments are described below and also detailed in the tables below.

Restatement Items

Channel Retained Funds and Other Expenses – The Company did not correctly apply the charges allocated to the Channel Retained Funds by the vendor. The corrections resulted in a decrease in Channel Retained Funds in the amount of $1,500,000 and resulted in an increase in Other Expenses, Cost of Revenue in the amount of $1,500,000. Refer to reference “a” below.

Processor Retained Funds, Receivables from On-Line Travel Agencies, Receivables from City of New York and Landlords, Accounts Payable and Accrued Expenses and Net Rental Revenue – The Company did not properly reserve for bad debt expense of $7,843,456 in the first quarter of 2024. The Company incorrectly recognized revenue in the first quarter of 2024 for reservations that were booked and paid for, but reservations were cancelled by the merchant service provider. The corrections resulted in a decrease in Processor Retained Funds of $2,633,926, Receivables from On-Line Travel Agencies of $6,749,769, Receivables from City of New York of $984,744 and increase in Accounts Payable and Accrued Expenses of $3,738,224 and a decrease in Net Rental Revenue of $6,263,207 and increase in General and Administrative Expenses of $8,387,549. Refer to reference “b” below.

Receivable from City of New York, Accounts Payable and Accrued Expenses and Net Rental Revenue – The Company did not reflect the net receivable due from the City of New York. The corrections reflect the net amount due from the City of New York in conjunction with the landlord. The receivable has been reduced by $3,201,640, the payables have been reduced by $1,827,157 and the Net Rental Revenue has been reduced by $830,390. Refer to reference “c” below.

Prepaid Expenses and Other Current Assets and Other Expenses – The Company did not properly amortize the prepaid real estate taxes in the first quarter of 2024. The correction resulted in a decrease in Prepaid Expenses and Other Current Assets and an increase in Other Expenses, Cost of Revenue in the amount of $342,212. Refer to reference “d” below.

Bookings Received in Advance and Net Rental Revenue – The Company incorrectly recognized revenue in the first quarter of 2024 for reservations that were booked and paid for, but the guest had not yet stayed at the property. The corrections resulted in an increase in Bookings Received in Advance in the amount of $8,050,248 and a decrease in Net Rental Revenue in the amount of $8,050,248. The future revenues will be recognized when the guest checks in. Refer to reference “d” below.

The following tables present the effect of the Restatement Items on the Company’s condensed consolidated balance sheet for the period indicated:

Condensed balance sheet
	As of March 31, 2024 (unaudited)
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
ASSETS
Current Assets
Cash and Cash Equivalents	$	994,904		$	-		$	994,904
Accounts Receivable, Net		486,067			-			486,067
Channel Retained Funds, Net		1,500,000			(1,500,000	)		-		a
Processor Retained Funds, Net		2,633,926			(2,633,926	)		-		b
Receivables from On-Line Travel Agencies, Net		6,749,769			(6,749,769	)		-		b
					(984,744	)				b
Receivables from City of New York and Landlords, Net		6,018,035			(3,201,640	)		1,831,651		c
Prepaid Expenses and Other Current Assets		1,361,114			(342,212	)		1,018,902		d
Prepaid Guarantee Trust - Related Party		672,750			-			672,750
Total Current Assets		20,416,565			(15,412,291	)		5,004,274
Other Assets
Furniture, Equipment and Leasehold Improvements, Net		677,559			-			677,559
Security Deposits - Noncurrent		20,607,413			-			20,607,413
Prepaid Expenses and Other Noncurrent Assets		5,974,276			-			5,974,276
Operating Lease Right-Of-Use Assets, Net		229,016,100			-			229,016,100
Total Other Assets		256,275,348			-			256,275,348
Total Assets	$	276,691,913		$	(15,412,291	)	$	261,279,622

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
				$	3,738,225					b
Accounts Payable and Accrued Expenses	$	28,868,844			(1,827,157	)	$	30,779,912		c
Bookings Received in Advance		6,576,403			8,050,248			14,626,651		e
Short Term Business Financing, Net		3,733,417			-			3,733,417
Loans Payable - Current		1,666,108			-			1,666,108
Initial Direct Costs Leases - Current		300,000			-			300,000
Operating Lease Liabilies - Current		1,944,026			-			1,944,026
Development Incentive Advances - Current		8,893,987			-			8,893,987
Total Current Liabilities		51,982,785			9,961,316			61,944,101
Long-Term Liabilities
Loans Payable		1,447,720			-			1,447,720
Development Incentive Advances - Noncurrent		-			-			-
Initial Direct Costs Leases - Noncurrent		3,950,000			-			3,950,000
Operating Lease Liabilities - Noncurrent		231,815,657			-			231,815,657
Total Long-Term Liabilities		237,213,377			-			237,213,377
Total Liabilities		289,196,162			9,961,316			299,157,478
Mezzanine equity
13% Redeemable Preferred Stock; Liquidation Perference $25 per Share; 10,000,000 Shares Authorized; 294,144 shares issued and outstanding as of March 31, 2024		5,775,596			-			5,775,596
Commitments and Contingencies
Stockholders’ Deficit
Common Stock (90,000,000 shares authorized, issued, outstanding - 41,839,361)		418			-			418
Additional Paid In Capital		98,455,107			-			98,455,107
Accumulated Deficit		(116,735,370	)		(25,373,607	)		(142,108,977	)	a, b, c, d, e
Total Stockholders’ Deficit		(18,279,845	)		(25,373,607	)		(43,653,452	)
Total Liabilities and Stockholders’ Deficit	$	276,691,913		$	(15,412,291	)	$	261,279,622

See accompanying notes to condensed consolidated financial statements.

The following tables present the effect of the Restatement Items on the Company’s condensed consolidated statement of operations for the period indicated:

Condensed income statement
	As of March 31, 2024 (unaudited)
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
Net Rental Revenue	$	29,101,207		$	(15,143,846	)	$	13,957,361		b, c, e
Rent Expense		8,344,007			-			8,344,007
Non-Cash Rent Expense Amortization		2,093,667			-			2,093,667
Surrender of Deposits		750,000			-			750,000
Other Expenses		22,508,411			1,842,212			24,350,623		a, d
Total Cost of Revenue		33,696,085			1,842,212			35,538,297
Gross (Loss) Profit		(4,594,878	)		(16,986,058	)		(21,580,936	)
General and Administrative Expenses		3,755,756			8,387,549			12,143,305		b
Non-Cash Issuance of Common Stock for Operating Expenses		304,925			-			304,925
Non-Cash Stock Compensation Expense		724,514			-			724,514
Non-Cash Stock Option Expense		152,339			-			152,339
Partnership Considerations		2,679,469			-			2,679,469
Total Operating Expenses		7,617,003			8,387,549			16,004,552
(Loss) Income from Operations		(12,211,881	)		(25,373,607	)		(37,585,488	)
Other Income (Expense)
Other Income		210,076			-			210,076
Cash Interest and Financing Costs		(2,459,800	)		-			(2,459,800	)
Non-Cash Financing Costs		(2,324,270	)		-			(2,324,270	)
Total Other Expense		(4,573,994	)		-			(4,573,994	)
Loss Before Provision for Income Taxes		(16,785,875	)		(25,373,607	)		(42,159,482	)
Provision for Income Taxes		-			-			-
Net Loss		(16,785,875	)		(25,373,607	)		(42,159,482	)
Preferred Stock Dividend		(238,992	)		-			(238,992	)
Net Loss Attributable to Common Stockholders	$	(17,024,867	)	$	(25,373,607	)	$	(42,398,474	)
Basic Loss Per Common Share	$	(0.35	)	$	(0.52	)	$	(0.87	)
Diluted Loss Per Common Share	$	(0.35	)	$	(0.52	)	$	(0.87	)
Basic and Diluted Weighted Average Number of Common Shares Outstanding		49,223,606			49,223,606			49,223,606

See accompanying notes to condensed consolidated financial statements.

The following tables present the effect of the Restatement Items on the Company’s condensed consolidated statement of changes in stockholders’ deficit for the period indicated:

Stockholders' equity
	Common Stock				Additional Paid in			Accumulated			Stockholders’			Restatement
	Shares		Value		Capital			Deficit			(Deficit)			References
Balance - December 31, 2023		39,462,440	$	394	$	90,437,155		$	(99,710,503	)	$	(9,272,954	)
Net Loss		-		-		-			(16,785,875	)		(16,785,875	)
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
Agreement		614,250		6		(6	)		-			-
Preferred Dividends		-		-		-			(238,992	)		(238,992	)
Restatement Items									(25,373,607	)		(25,373,607	)	a, b, c, d, e
Balance - March 31, 2024		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 Option Compensation 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
Restatement Items		-		-		-			-			-
Balance - March 31, 2023		29,392,464	$	293	$	22,367,539		$	(23,799,526	)	$	(1,431,694	)

See accompanying notes to condensed consolidated financial statements.

The following tables present the effect of the Restatement Items on the Company’s condensed consolidated statement of cash flows for the period indicated:

Condensed Cash Flow Statement
	As of March 31, 2024 (unaudited)
	As Previously			Restatement			As			Restatement
	Reported			Adjustments			Restated			References
Cash Flows from Operating Activities
Net (Loss)	$	(16,785,875	)	$	(25,373,607	)	$	(42,159,482	)	a, b, c, d, e
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Writeoff of bad debts					7,843,456			7,843,456		b
Writeoff of channel retained funds security deposit					1,500,000			1,500,000		a
Writeoff of security deposits		750,000			-			750,000
Writeoff of vendor overpayment		50,000			-			50,000
Non-cash stock compensation expense		55,500			-			55,500
Non-cash stock director expense		577,576			-			577,576
Non-cash stock option expense		152,339			-			152,339
Depreciation expense		13,676			-			13,676
Shares issued for operating expenses		304,926			-			304,926
Modification of Warrants		2,036,200			-			2,036,200
Non-cash lease expense		10,146,639			-			10,146,639
Gain on lease exit		(209,811	)		-			(209,811	)
Non-cash foregiveness of Development Incentive Advances		(75,210	)		-			(75,210	)
Gain on sale of Treasury Bills		-			-			-
Non-cash Financing Charges Associated with Short Term Business Financing		286,576			-			286,576
Loss on Debt Extinguishment		-			-			-
Changes in operating assets and liabilities:
(Increase) Decrease in:
Accounts Receivable, Net		(156,180	)		-			(156,180	)
Receivables from On-Line Travel Agencies, Net		186,485			2,524,983			2,711,468		b
Receivables from City of New York and Landlords, Net		(1,432,665	)		3,201,640			1,768,975		c
Prepaid expense and other assets		(4,415,639	)		342,212			(4,073,427	)	d
Prepaid Guarantee Trust - Related Party		351,000			-			351,000
Security deposits		(1,050,000	)		-			(1,050,000	)
(Decrease) Increase in:								-
Accounts payable and accrued expenses		5,636,539			1,911,068			7,547,607		b, c
Operating lease liabilities		(8,050,548	)		-			(8,050,548	)
Rents received in advance		2,172,187			8,050,248			10,222,435		e
Accrued Income Taxes		-			-			-
Net cash provided by operating activities		(9,456,285	)		-			(9,456,285	)

Cash Flows from Investing Activities
Purchase of Furniture and Equipment		-			-			-
Proceeds from the sale of Treasury Bills		-			-			-
Net cash provided by investing activities		-			-			-

Cash Flows from Financing Activities
Deferred offering costs - net
Proceeds from (Repayments of) short term business financing - net		2,331,721			-			2,331,721
Warrant Exercises		4,800,000			-			4,800,000
Proceeds from Development Incentive Advances		3,000,500			-			3,000,500
Proceds from (Repayments of) loans payable - net		67			-			67
Repayments of loans payable - net		(194,955	)		-			(194,955	)
Preferred shareholder dividends paid		(238,992	)		-			(238,992	)
Net cash used in financing activities		9,698,341			-			9,698,341

Net Increase in Cash and Cash Equivalents and Restricted Cash		242,056			-			242,056
Cash and Cash Equivalents and Restricted Cash - beginning of the period		752,848			-			752,848
Cash and Cash Equivalents and Restricted Cash - end of the period		994,904			-			994,904

Cash and Cash Equivalents		994,904			-			994,904
Restricted Cash		-			-			-
Total Cash and Cash Equivalents and Restricted Cash	$	994,904		$	-		$	994,904

Supplemental Disclosures of Cash Flow Information
Taxes	$	-		$	-		$	-
Interest	$	1,598,784		$	-		$	1,598,784
Noncash operating activities:
Acquisition of New Operating Lease Right-of-Use Assets	$	-		$	-		$	-
Noncash financing activities:
Financed Initial Direct Costs for leases paid with common stock	$	91,435		$	-		$	91,435
Conversion of debt to common stock and additional paid-in capital	$	-		$	-		$	-

See accompanying notes to condensed consolidated financial statements.

3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, AS RESTATED

Basis of Presentation — The accompanying consolidated financial statements are prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Revenue Recognition — The Company’s revenue is derived primarily from the rental of units to its guests. The Company accounts for revenue in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606. The Company recognizes revenue when obligations under the terms of a contract are satisfied and control over the promised goods and services is transferred to the guest. For the majority of revenue, this occurs when the guest occupies the unit for the agreed upon length of time and receives any services that may be included with their stay. Revenue is measured as the amount of consideration it expects to receive in exchange for the promised goods and services. The Company recognizes any refunds and allowances as a reduction of rental income in the consolidated statements of operations.

Payment received for the future use of a rental unit is recognized as a liability and reported as rents received in advance on the balance sheets. Rents received in advance are recognized as revenue after the rental unit is occupied by the customer for the agreed upon length of time. The rents received in advance balance as of March 31, 2024, and December 31, 2023, was $14,626,651 and $4,404,216, respectively and is expected to be recognized as revenue within a one-year period.

Use of Estimates — The preparation of financial statements in accordance with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements. Actual results could differ from those estimates.

Going Concern — The accompanying financial statements have been prepared in conformity with U.S. GAAP, which contemplates continuation as a going concern. As reflected in the accompanying statement of operations, for the year ended December 31, 2023, and the three-month ended March 31, 2024, the Company had a net loss of $78,523,377 and $42,159,482, respectively. In addition, the Company sustained significant losses in prior years. The Company’s working capital as of March 31, 2024, was a deficit of $56,939,827. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. Management has evaluated the significance of the conditions in relation to the Company’ ability to meet its obligations and believes that its current cash balance along with its currently projected cash flows from operations will not provide sufficient capital to continue as a going concern. In an effort to achieve liquidity that would be sufficient to meet all of our commitments, we have undertaken a number of actions, including raising capital through the sale of equity and the sale of debt. The Company’s ability to continue as a going concern is dependent upon improving operating margins and raising capital through debt and/or equity financing. Without additional capital, we may not have sufficient capital to continue operations. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might result from this uncertainty.

Cash and Cash Equivalents — The Company considers all highly liquid investments with original maturities of three months or less when purchased to be cash equivalents. As of March 31, 2024, the Company had cash and cash equivalents of $994,904. The Company had $752,848 of cash equivalents as of December 31, 2023.

Accounts Receivable, Channel Retained Funds, and Processor Retained Funds — The Company’s accounts receivable consists of amounts due from landlords, amounts due from the City of New York, and receivables from Online Travel Agents (“OTAs”) and other sales channels. The amounts due from landlords are related to common area expenses we incur for the benefit of all tenants and ultimately can be netted to amounts owed to the landlord, not requiring an allowance as the amounts owed to the landlord are far greater than amounts owed to us. Regarding the receivable with the City of New York, we have cancelled our contract with the City of New York and do not expect the need for an allowance of credit losses on the remaining balanced owed to us. During the year ended December 31, 2023, we wrote off $2,947,780 of receivables from the city on a property we leased but later decided to exit due to the timing of payments from the City of New York. Finally, we have a reserve for credit losses with receivables from OTAs, in the amount of the full balance outstanding and $529,000 as of March 31, 2024 and December 31, 2023, respectively. Processor retained funds on the balance sheet are net of any requested and allowed chargebacks and funds released to use during the period.

Fair Value of Financial Instruments — The carrying amount of cash and cash equivalents, processor retained funds, security deposits, accounts payable and accrued expenses, rents received in advance, receivables from OTAs, development incentive advances, and short-term business financing advances approximate their fair values as of March 31, 2024 and December 31, 2023 because of their short term natures.

Commissions — The Company pays commissions to third-party sales channels to handle the marketing, reservations, collections, and other rental processes for most of the units. For the three months ended March 31, 2024, commissions were $6,192,305 as compared to $3,073,533 for the three months ended March 31, 2023. These expenses are included in cost of revenue in the accompanying consolidated statement of operations.

Income Taxes — In accordance with GAAP, the Company follows the guidance in FASB ASC Topic 740, Accounting for Uncertainty in Income Taxes, which clarifies the accounting for uncertainty in income taxes recognized in the Company’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. It also provides guidance on derecognition and measurement of a tax position taken or expected to be taken in a tax return.

The Company is subject to income taxes in the jurisdictions in which it operates. The Company accounts for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized based on the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and attributable to operating loss and tax credit carry-forwards. A valuation allowance is recorded for deferred tax assets if it is more likely than not that the deferred tax assets will not be realized.

For the three months ended March 31, 2024, the Company did not record a tax provision for income taxes as a result of net losses for the period. For the three months ended March 31, 2023, the Company recorded a tax provision of $122,161.

Sales Tax — The majority of sales tax is collected from customers by our third-party sales channels and remitted to governmental authorities by these third-party sales channels. For any sales tax that is the Company’s responsibility to remit, the Company records the amounts collected as accrued expenses and relieves such liability upon remittance to the taxing authority. Rental income is presented net of any sales tax collected. As of March 31, 2024 and December 31, 2023, the Company accrued sales tax payable of $363,952 and $3,266,302, respectively, and it is included in accounts payable and accrued expenses in the consolidated balance sheet.

Paycheck Protection Program Loan (“PPP”) — As disclosed in Note 3, the Company has chosen to account for the loan under FASB ASC 470, Debt. Repayment amounts due within one year are recorded as current liabilities, and the remaining amounts due in more than one year, if any, as other liabilities. In accordance with ASC 835, Interest, no imputed interest is recorded as the below market interest rate applied to this loan is governmentally prescribed. If the Company is successful in receiving forgiveness for those portions of the loan used for qualifying expenses, those amounts will be recorded as a gain upon extinguishment as noted in ASC 405, Liabilities.

Earnings Per Share (“EPS”) — Basic net loss per share is the same as diluted net loss per share for the three months ended March 31, 2024 because the inclusion of potentially issuable shares of common stock would have been anti-dilutive for the periods presented. For the three months ended March 31, 2023, basic net loss per share is the same as diluted net loss per share because the inclusion of potentially issuable shares of common stock would have been anti-dilutive for the periods presented.

Preferred Stock — The Company accounts for its preferred stock in accordance with ASC Topic 480, Distinguishing Liabilities from Equity. Conditionally redeemable preferred stock is classified as mezzanine equity within the Company’s consolidated balance sheet.

4 - LEASES

Under ASC 842, the Company applies a dual approach to all leases whereby the Company is a lessee and classifies leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the Company. Lease classification is evaluated at the inception of the lease agreement. Regardless of classification, the Company records a right-of-use asset and a lease liability for all leases with a term greater than 12 months. Operating lease expense is recognized on a straight-line basis over the term of the lease.

Operating right of use (“ROU”) assets and operating lease liabilities are recognized at the lease commencement date. Operating lease liabilities represent the present value of lease payments not yet paid. Operating right of use assets represent our right to use an underlying asset and is based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and impairment of operating lease assets. To determine the present value of lease payments not yet paid, we estimate incremental secured borrowing rates corresponding to the maturities of the leases.

The components of the right-of-use assets and lease liabilities as of March 31, 2024 and December 31, 2023 were as follows:

At March 31, 2024 and December 31, 2023, supplemental balance sheet information related to leases were as follows:


	March 31, 2024		December 31, 2023
Operating lease right of use assets, net	$	229,016,100	$	241,613,588
Operating lease liabilities, current portion	$	1,944,026	$	1,982,281
Operating lease liabilities, net of current portion	$	231,815,657	$	242,488,610

At March 31, 2024, future minimum lease payments under the non-cancelable operating leases are as follows:

Schedule of future minimum lease payments under the non-cancelable operating leases


Twelve Months Ending March 31,
2025	$	30,835,724
2026		31,709,210
2027		32,589,176
2028		33,826,455
2029		34,890,889
Thereafter		409,189,267
Total lease payment	$	573,040,721
Less interest		(339,281,038	)
Present value obligation		233,759,683
Short-term liability		1,944,026
Long-term liability	$	231,815,657

The following summarizes other supplemental information about the Company’s operating lease:


	March 31, 2024			March 31, 2023
Weighted average discount rate		12.15	%		10.0	%
Weighted average remaining lease term (years)		13.4 years			13.0 years

	Three Months Ended March 31, 2024		Three Months Ended March 31, 2023
Operating lease cost	$	10,146,639	$	6,456,680
Short-term lease cost	$	291,035	$	616,856
Total lease cost	$	10,437,674	$	7,073,536

5 - ACCOUNTS RECEIVABLES, PROCESSOR AND CHANNEL RETAINED FUNDS, AS RESTATED

As of March 31, 2024 we had $0 of channel retained funds, $0 of processor retained funds, $0 of receivables from OTAs $1,480,000 in receivables from the City of New York and landlords and other receivables of $351,651. These items as of December 31, 2023 had $1,500,000 of channel retained funds, $2,633,926 of processor retained funds, (net of allowances for credit losses of $393,412) $6,936,254 of receivables from OTAs (net of allowances for credit losses of $529,000) $4,585,370 in receivables from the City of New York and landlords and other receivables of $329,987 (net of allowances for credit losses of $486,708).

6 - ACCOUNTS PAYABLE AND ACCRUED LIABILITIES, AS RESTATED

Accounts payable and accrued expenses totaled $30,779,912 and $23,182,305 as of March 31, 2024 and December 31, 2023, respectively.

As of March 31, 2024, the balance consisted of approximately $1,203,000 of accrued payroll and related liabilities, $3,329,000 of utilities fees, $9,783,000 of legal exposure, $4,912,000 in sales and other taxes, $3,258,000 for rent, $850,000 for interest expense, $289,000 for telephone and cable expense, $627,000 of insurance expense, $246,000 professional fees, $960,000 for repairs, maintenance and improvements, $582,000 for linens, sundries and supplies, $317,000 for cleaning expense, $563,000 for initial franchise fees paid on behalf of the Company by a related party (repaid subsequent to March 31, 2024), $123,000 for commissions, $216,000 for printing expense, $3,738,000 refunds due customers and $690,000 of other miscellaneous items.

As of December 31, 2023, the balance consisted of approximately $2,024,000 of accrued payroll and related liabilities, $3,265,000 of utilities fees, $1,737,000 of rent, $632,000 of commissions, $8,400,000 of legal exposure, $3,910,000 in sales and other taxes, $590,000 in professional fees, $420,000 of supplies and sundries, $719,000 of repairs, maintenance and improvements, $194,000 of insurance expense, $288,223 of bank and service fees, $52,000 of processing fees, $94,000 of license fees and public relations, $263,000 of printing expenses, $231,000 of Director fees, $71,000 of internet and software expense and $42,000 of other miscellaneous items.

Of the legal amounts accrued, the company believes the accrual best estimates the most likely outcomes of these matters however the range of outcomes could be between $5 million and $8.5 million.

7 - LOANS PAYABLE – SBA – PPP LOAN

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted to provide emergency assistance for individuals, families, and organizations affected by the coronavirus pandemic. The PPP, created through the CARES Act, provides qualified organizations with loans of up to $10,000,000. Under the terms of the CARES Act and the PPP, the Company can apply for and be granted forgiveness for all or a portion of the loan issued to the extent the proceeds are used in accordance with the PPP.

In April and May 2020, SoBeNY and CorpHousing obtained funding of $516,225 and $298,958, respectively, from a bank established by the Small Business Administration (“SBA”). The loans have an initial deferment period wherein no payments are due until the application of forgiveness is submitted, not to exceed ten months from the covered period. Interest will continue to accrue during this deferment period. The April loan was written off by the bank in the September 2022 quarter and subsequently taken to other income. After the deferment period ends, the May loan is payable in equal monthly installments of $15,932, including principal and interest at a fixed rate of 1.00%. No collateral or personal guarantees were required to obtain the PPP loans. The Company does not intend to apply for forgiveness of these loans and expects to repay the loans in accordance with the terms of the agreements.

Accrued interest at March 31, 2024 and December 31, 2023, was $6,318 and $5,571, respectively, and is included in accounts payable and accrued expenses in the consolidated balance sheets.

Future minimum principal repayments of the SBA - PPP loans payable are as follows:


For the Twelve Months Ending March 31,
2025	$	276,658

8 - LOANS PAYABLE – SBA – EIDL LOAN

During 2020, the Company received three 3 SBA Economic Injury Disaster Loans (“EIDL”) in response to the COVID-19 pandemic. These are 30-year loans under the EIDL program, which is administered through the SBA. Under the guidelines of the EIDL, the maximum term is 30 years; however, terms are determined on a case-by-case basis based on each borrower’s ability to repay and carry an interest rate of 3.75%. The EIDL loan may be prepaid by the Company at any time prior to maturity with no prepayment penalties. The proceeds from this loan must be used solely as working capital to alleviate economic injury caused by the COVID-19 pandemic.

On April 21, 2020, SoBeNY received an EIDL loan in the amount of $500,000. The loan bears interest at 3.75% and requires monthly payments of principal and interest of $2,437 beginning April 21, 2022, and is personally guaranteed by a major stockholder. On June 18, 2020, Corphousing received an EIDL loan in the amount of $150,000. The loan bears interest at 3.75% and requires monthly payments of principal and interest of $731 beginning June 18, 2022. On July 25, 2020, SoBeNY received an EIDL loan in the amount of $150,000. The loan bears interest at 3.75% and requires monthly payments of principal and interest of $731 beginning July 25, 2022. Any remaining principal and accrued interest is payable thirty years from the date of the EIDL loan.

The outstanding balance at March 31, 2024 and December 31, 2023, was $783,319 and $786,950, respectively.

Accrued interest at March 31, 2024 and December 31, 2023 was $8,966 and $27,644 and respectively included in accounts payable and accrued expenses in the consolidated balance sheets.

Future minimum principal repayments of the SBA - EIDL loans payable are as follows:

Schedule of future minimum principal repayments of the SBA,EIDL loans payable


For the Twelve Months Ending March 31,
2025	$	18,699
2026		15,536
2027		16,129
2028		16,744
2029		17,383
Thereafter		698,828
Total	$	783,319

9 - SHORT-TERM BUSINESS FINANCING

The Company entered into multiple short-term factoring agreements related to future credit card receipts to fund operations. The Company is required to repay this financing in fixed daily payments until the balance is repaid. Fees associated with this financing have been recognized in interest expense in the accompanying consolidated statement of operations. As of March 31, 2024 and December 31, 2023, the outstanding balance on these merchant cash advances net of unamortized costs was $3,733,417 and $1,115,120, respectively and is expected to be repaid within twelve months.

10 - LOANS PAYABLE

Loans payable consist of the following as of:

Schedule of loans payable
	March 31, 2024		December 31, 2023
Original payable of $151,096 with additional net borrowings of $252,954, requires monthly payments of $1,500 until total payments of $404,050 have been made		356,012		338,512
Original payable of $553,175 with additional net borrowings of $72,237, requires monthly payments of $25,000 until total payments of $625,412 have been made		400,000		400,000
Original payable of $492,180 with additional net borrowings of $620,804 requires monthly payments of $25,000 until total payments of $1,112,984 have been made		865,618		865,618
Original amounts due of $195,000, related to services provided by a vendor, requires monthly payments of $10,000 through May 2022, then monthly payments of $25,000 through August 2022 at which time any remaining balance is due		20,000		20,000
Other borrowing		342,246		356,048
Less: Current maturities		1,370,751		1,360,609
	$	613,125	$	619,569

Future minimum principal repayments of the loans payable are as follows:


For the Twelve Months Ending March 31,
2024	$	1,370,751
2025		613,125
Loans payable	$	1,983,876

11 - LINE OF CREDIT

In February 2019, the Company entered into a line of credit agreement in the amount of $95,000. The line bears interest at prime, 8.25% as of March 31, 2024, plus 3.49%. The line matures in February 2029. Outstanding borrowings were $69,975 as of March 31, 2024 and December 31, 2023.

12 - RELATED PARTY TRANSACTIONS

On December 20, 2022, the Company, and our former Chairman and Chief Executive Officer, Brian Ferdinand (“Ferdinand”), entered into a Note Extension and Conversion Agreement with Greenle Partners LLC Series Alpha PS (“Greenle Alpha”) and Greenle Partners LLC Series Beta P.S., a Delaware limited liability company (“Greenle Beta” and, together with Greenle Alpha, “Greenle”). Greenle was the purchaser of 15% OID senior secured notes (the “Notes”) and warrants to purchase our common stock (“Warrants”) under certain securities purchase agreements and loan agreements between us and Greenle, including the Securities Purchase Agreement dated as of March 31, 2023, as amended by the letter agreement dated October 20, 2022, and the Loan Agreement dated as of November 23, 2022.

Under the terms of the Note Extension and Conversion Agreement, Greenle agreed to convert from time to time up to $3,000,000 aggregate principal amount of the Notes into up to 1,000,000 shares of the Company’s common stock (the “Conversion Shares”) at the conversion price of $3.00 per share prescribed by the Notes. Additionally, Greenle agreed that the payment date of certain of the Notes in the aggregate principal amount of $1,250,000, maturing on January 30, 2023, would be extended to March 1, 2023. On the date of any such conversion, the Company would be obligated to issue to Greenle a number of credits under our existing revenue share agreements with them equal to fifteen percent (15%) of the principal amount of the Notes so converted. As of December 31, 2022, $300,000 of this note was converted and the entire $3,000,000 was converted in January of 2023. As part of this conversion, Mr. Ferdinand contributed to the Company 874,474 shares of common stock owned by him and his affiliates, which in turn, were used by the Company to fund the issuance of the Conversion Shares to Greenle in exchange for the conversion of the debt under the notes, which was maturing within a few months of this contribution. At the time of such contribution by Mr. Ferdinand, the market value of the shares of common stock so contributed was approximated $1.5 million.

On November 17, 2023, the Company entered into a financing agreement with THA Holdings LLC (the “Lender”), an entity controlled and operated by Mr. Ferdinand, pursuant to which the Company agreed to issue to the Lender an unsecured, advancing term promissory note (the “Note”). Under the Note, the Company is able to borrow, and the Lender has committed to lend to the Company up to an aggregate principal amount of $10,000,000 (the “Initial Principal Amount”) to be funded in increments of $1,000,000 upon the Company’s request by the sale, from time to time, of shares of the Company’s common stock, owned by the Lender. On December 3, 2023, the Company and Mr. Ferdinand mutually agreed to cancel the Note. The amount of proceeds, less taxes, resulting from sales of common stock prior to the cancelation in the amount of $311,234 was contributed to the Company by Mr. Ferdinand. This was recorded as a contribution by founder in the accompanying consolidated statement of changes in equity.

In December of 2023 and during the three months ended March 31, 2024, we paid $1,350,000 and $351,000, respectively to Ferdinand under the terms of the Guarantee Trust agreement as part of his personal guarantees on the Wyndham agreements and the Development Incentive Advances. At December 31, 2023 and March 31, 2024, $1,023,750 and $672,750 of this payment was classified as prepaid. During the three months ended March 31, 2024, $351,000 was expensed.

13 - RISKS AND UNCERTAINTIES

The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash. The Company places its cash with high quality credit institutions. At times, balances may be in excess of the Federal Deposit Insurance Corporation (“FDIC”) insurance limits. All accounts at an insured depository institution are insured by the FDIC up to the standard maximum deposit insurance of $250,000 per institution.

14 - MAJOR SALES CHANNELS

The Company uses third-party sales channels to handle the reservations, collections, and other rental processes for most of the units. These sales channels represented over 85% of total revenue during the three months ended March 31, 2024 and March 31, 2023, respectively. The loss of business from one or a combination of the Company’s significant sales channels, or an unexpected deterioration in their financial condition, could adversely affect the Company’s operations.

15 - STOCK OPTIONS, RESTRICTED STOCK UNITS AND WARRANTS

Options

During the three months ended March 31, 2024, the Company did not grant any options to purchase shares of common stock under the Company’s 2022 performance equity plan.

The following table summarizes stock option activity for the three months ended March 31, 2024:


	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value
Outstanding at December 31, 2023		1,746,885		$	2.86		9.0	$	5,427,118
Granted		-			-
Exercised		-			-
Expired		-			-
Forfeited		(29,250	)		2.09
Outstanding at March 31, 2024		1,717,635		$	2.88		8.7	$	-
Exercisable at March 31, 2024		485,045		$	2.69		8.6	$	-

The Company is expensing these stock option awards on a straight-line basis over the requisite service period. The Company recognized stock option expense of $152,339 for the three months ended March 31, 2024. The Company recognized stock option expense of $167,573 for the three months ended March 31, 2023. Unamortized option expense as of March 31, 2024, for all options outstanding amounted to $1,137,358. These costs are expected to be recognized over a weighted average period of .92 years.

A summary of the status of the Company’s nonvested options as of March 31, 2024, is presented below:


	Number of Nonvested Options			Weighted Average Grant Date Fair Value
Nonvested options at December 31, 2023		1,257,590		$	2.93
Granted		-			-
Forfeited		-			-
Vested		(25,000	)	$	1.74
Nonvested options at March 31, 2024		1,232,590		$	2.95

Restricted Stock Units

In March 2024, the Company granted 100,000 restricted shares to certain employees under the Company’s 2022 performance equity plan. The restricted shares were vested either immediately or over 3.00 years. The aggregated grant date fair value of all these restricted shares was $220,000.

As of March 31, 2024, there was $166,500 of unrecognized compensation cost related to unvested restricted shares.

Warrants

In connection with certain private placements funded by certain of the Company’s officers and directors prior to the Company’s initial public offering, the Company issued promissory notes and warrants. The warrants were contingent upon, and became effective upon, consummation of the Company’s initial public offering on August 11, 2022. In total, warrants to purchase up to 695,000 shares of the Company’s common stock were issued to certain of the Company’s officers and directors with a weighted average exercise price of $4.20. These warrants are exercisable for five 5 years from date of effectiveness and expire in August 2027.

Also, in conjunction with the initial public offering, the Company issued warrants to purchase up to 135,000 shares of the Company’s common stock to the underwriter of the initial public offering, Maxim Group LLC (“Maxim”), with an exercise price of $4.40. These warrants are exercisable for five 5 years and expire in August 2027.

Also, in connection with certain private placements with Greenle, the Company issued warrants to purchase up to 920,000 shares of the Company’s common stock with an exercise price of $4.00. These warrants are exercisable for five years and expire in August of 2027. In connection with such private placements, the Company also issued warrants to purchase up to 32,000 shares of the Company’s common stock to Maxim (which served as agent for such private placement) at an exercise price of $4.40. These warrants are exercisable for five 5 years and expire in August of 2027.

On September 16, 2022, September 30, 2022, and October 30, 2022 in conjunction with a financing with the same third-party investor, the Company issued warrants to purchase up to 517,500 shares, 352,188 shares, and 366,562 shares of the Company’s common stock, respectively, all of which warrants had an exercise price of $4.00 per share. These warrants were subsequently cancelled and reissued at $2.00 per share in August of 2023.

On February 15, 2023, in conjunction with an advisory agreement, the Company issued warrants to purchase up to 250,000 shares of our common stock with an exercise price of $4.00 per share. These warrants have a term of five years and expire in February 2028. As a result of these transaction, the Company recorded $167,573 in warrant expense.

On April 16, 2023 in conjunction with an agreement with certain lenders, the Company issued warrants to purchase up to 1,000,000 shares of the Company’s common stock with an exercise price of $3.00 per share, and warrants to purchase up to 250,000 shares of our common stock with an exercise price of $4.00 per share. All of these warrants have a term of 5 years and expire in April of 2028. Under this agreement, these lenders would be required to exercise all or a portion of these warrants if the Company’s common stock traded at prices between $3.00 per share and $4.00 per share for a prescribed number of trading days. On June 19, 2023, this agreement was modified to convert all of related outstanding debt in exchange for a reduction in the exercise price of all of these warrants to $2.50 per share. In conjunction with these transactions, the Company recorded non-cash financing expenses of $259,074.

On November 6, 2023, in conjunction with an agreement with certain shareholders to amend agreements to waive registration rights for any currently issued common stock for a period of 12 months and any future issuances for a rolling 12-month period from the date such of issuance of such common stock. As consideration for this waiver, the Company issued 2,000,000 warrants of common stock at an exercise price of $4.00 a share. As a result of these transactions, the Company recorded $4,939,000 in warrant expense.

On December 17, 2023, the Company and certain existing warrant holders entered into an agreement pursuant to which these warrant holders exercised a portion of their existing warrants to purchase an aggregate of 1,000,000 shares of the Company’s common stock. for gross proceeds of $4,000,000. As consideration for this agreement, the Company issued new warrants to purchase up to 2,000,000 shares of the Company’s common stock at an exercise price of $5.00 per share. As a result of these transactions, the Company recorded $4,187,800 in warrant expense.

On December 27, 2023, the Company and certain existing warrant holders entered into an agreement pursuant to which these warrant holders exercised a portion of their existing warrants to purchase an aggregate of 500,000 shares of the Company’s common stock for gross proceeds of $2,000,000. As consideration for this agreement, the Company issued new warrant to purchase up to 1,000,000 shares of Common Stock at an exercise price of $5.50. As a result of these transactions, the Company recorded $3,081,400 in warrant expense.

On February 16, 2024, LuxUrban Hotels Inc. (“Company”) entered into a letter agreement with Greenle Partners LLC Series Alpha P.S., a Delaware limited liability company (“Greenle Alpha”), and Greenle Partners LLC Series Beta P.S., a Delaware limited liability company (“Greenle Beta” and together with Greenle Alpha, “Greenle”) holders of certain warrants to purchase the Company’s common stock (“Warrants”), which were issued in private placements from time to time as previously reported by the Company. Under the terms of the letter agreement, in consideration of the agreement of Greenle to exercise 50% of the Warrants originally issued by the Company on November 6, 2023 (the “November Warrants”) within three (3) business days of the date of the letter agreement and 50% of the November Warrants on or prior to February 23, 2024, the exercise price of the November Warrants has been reduced from $4.00 to $2.00 and the exercise price of all of the other Warrants held by Greenle has been reduced from $5.00 and $5.50, as applicable, to $2.50. Except as described above, the Warrants remain unchanged.

The following table summarizes warrant activity for the three months ended March 31, 2024:

Schedule of stock option activity
	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value
Outstanding at December 31, 2023		5,442,000		$	4.68		4.7	$	7,038,940
Granted		-			-
Exercised		(1,450,000	)		3.31
Expired		-			-
Forfeited		-			-
Outstanding at March 31, 2024		3,992,000		$	2.92		4.4	$	-
Exercisable at March 31, 2024		3,992,000		$	2.92		4.4	$	-

During the three months ended March 31, 2024, 1,450,000 shares were issued from the exercise of warrants.

16 - Revenue Share Exchange

Under the terms of agreements entered into with Greenle, we were obligated to make quarterly payments (each a “Revenue Share”) to Greenle based on certain percentages of the revenues generated by certain of our leased properties during the term of the applicable leases (including any extensions thereof).

As previously reported, on February 13, 2023, the Company and Greenle entered into an agreement pursuant to which certain Revenue Share payments for 2023 were converted into an obligation to issue shares of our common stock to Greenle in the amounts prescribed therein (the “February 2023 Revenue Share Agreement”), with all future Revenue Share obligations accruing on and after January 1, 2024 remaining in place.

On May 21, 2023, we entered into a further agreement with Greenle (the “May 2023 Revenue Share Exchange Agreement”) pursuant to which the right to receive any and all Revenue Share with respect to any property or operations of the Company has been terminated in its entirety for 2024 and forever thereafter, and Greenle shall not be entitled to receive any payment therefor (other than the remaining periodic share issuances and cash payments under the February 2023 Revenue Share Agreement, all of which shall be completed by January 1, 2024).

In consideration for the termination of the Revenue Share for 2024 and thereafter, we agreed to issue to Greenle, from time to time, in each case, at Greenle’s election upon 61 days’ prior written notice delivered to us on and after September 1, 2023 and before August 31, 2028, up to an aggregate of 6,740,000 shares of our common stock (the “Agreement Shares”). As a result of this transaction, we recorded interest expense of $28,174,148 in the second quarter of 2023.

On February 12, 2024, the Company issued 36,179 shares of the Company’s common stock and 578,071 shares of the Company’s common stock to Greenle Beta and Greenle Alpha, respectively, in connection with the February 2023 Revenue Share Agreement.

17 - WYNDHAM AGREEMENTS

As of March 31, 2024, we recorded the Development Incentive Advances as a current liability on our Condensed Consolidated Balance Sheets and recorded an additional charge of $2.6 million for all of the costs and potential additional liabilities related to this transition in our Condensed Consolidated Statement of Operations for the three months ended March 31, 2024. We believe it is in the best interest of both parties to mutually work out an agreeable outcome for the complete settlement of this matter.

Prior to the termination discussed above, on August 2, 2023, the Company entered into franchise agreements with Wyndham Hotels & Resorts, Inc. pursuant to which the hotels operated by the Company were to become part of the Trademark Collection^® by Wyndham and Travelodge by Wyndham brands while staying under the operational control of the Company.

The Franchise Agreements had initial terms of 15 to 20 years and required Wyndham to provide financial, sales and operational-related support with respect to the Initial Properties. The Franchise Agreements contained customary representations, warranties, covenants, indemnification, liquidated damages and other terms for transactions of a similar nature, including customary membership and marketing fees and if applicable, booking fees.

Pursuant to the Franchise Agreements, Wyndham was to provide capital through development advance notes (“Development Incentive Advances”) to the Company. Consistent with market practice, such Development Incentive Advances were to be evidenced by certain promissory notes with customary amortization and repayment terms. The Development Incentive Advances were not repayable if the terms of the agreement were met, including but not limited to the length of the agreement. In conjunction with the Company’s entry into the Franchise Agreements, the Company also paid a one-time, initial, nonrefundable franchise fee to Wyndham.

18 - REDEEMABLE PREFERRED STOCK

On October 26, 2023, the Company issued 280,000 shares of 13% Series A Cumulative Redeemable Preferred Stock (“Series A Preferred Stock”) at a stated value of $25 per share. Subsequently as part of the underwriters’ overallotment option, an additional 14,144 shares were sold on December 5, 2023. The Company realized aggregate net proceeds of $5,775,596 in connection with the issuances of these shares.

As part of the terms of the Series A Preferred Stock offering, if a change of control or delisting event occurs prior to October 26, 2024, the Company will be required to redeem the Series A Preferred Stock plus an amount equal to any accrued and unpaid interest. Under FASB Topic D-98, this redemption provision requires the classification of this security outside of permanent equity. The Company has classified this security as Mezzanine Equity on its March 31, 2024 Balance Sheet and expects to do so until October 26, 2024.

During the three months ended March 31, 2024, the Company paid $238,992 in aggregate dividends on its outstanding Series A Preferred Stock.

19 - EQUITY TRANSACTIONS

The tables below outline equity issuances not related to the conversion from an LLC to C Corp, the initial public offering the exercise of Options or Warrants, the conversion of debt into equity or the issuance of shares pursuant to revenue share agreements.

For the three months ended March 31, 2024

Schedule of equity transactions
Description	General Ledger Account	Date	Shares		Price		Value
Non-employee loan payment	Loan payable	1/25/2024		20,008	$	4.57	$	91,437
Non-employee commission expense	Commission Expense	1/25/2024		10,079	$	4.57	$	46,061
Non-employee investor relations expense	Investor Relations Expense	1/30/2024		59,784	$	4.33	$	258,865
Non-employee director compensation	Non-Cash Issuance of Common Stock for Director Compensation Expenses	2/8/2024		197,800	$	2.92	$	577,576
Employee Compensation	Non-Cash Issuance of Common Stock for Compensation Expenses	3/15/2024		25,000	$	2.22	$	55,500
Subtotal				312,671			$	1,029,439

For the three months ended March 31, 2023

Description	General Ledger Account	Date	Shares		Price		Value
Non-employee Board members pursuant to related comp. policy	Non-Cash Stock Compensation Expense	3/1/2023		166,665	$	2.58	$	429,996
In connection with certain property finders’ fee arrangements	Non-Cash Issuance of Common Stock for Operating Expenses	3/17/2023		136,887	$	2.45	$	335,373
In connection with a consulting agreement	Non-Cash Issuance of Common Stock for Operating Expenses	2/10/2023		196,994	$	1.85	$	364,439
In connection with a marketing agreement	Non-Cash Issuance of Common Stock for Operating Expenses	2/10/2023		100,000	$	1.85	$	185,000
Subtotal				600,546			$	1,314,808

20 - SUBSEQUENT EVENTS

Management Transitions

The Company has been engaged in a dedicated effort to enhance its management and operations teams through the recruitment of talented directors and officers who possess meaningful and broad experience in the hotel and online travel services industries, as well as business development expertise. As part of these efforts, effective April 22, 2024, the Company implemented the following:

●

Elan Blutinger, a hotel and travel technology veteran and a member of the Company’s board of directors, was named its Nonexecutive Chairman of the Board;

●

Shanoop Kothari, the Company’s Co-Chief Executive Officer and acting Chief Financial Officer, was named its sole Chief Executive Officer;

●

Brian Ferdinand, the Company’s founder, stepped down as Chairman of the Board and Co-Chief Executive Officer and became a consultant to the Company, in which role he will oversee the management and expansion of the Company’s hotel properties portfolio and assist Mr. Kothari in his transition to sole Chief Executive Officer; and stepped down as Chief Executive Officer and Chief Financial Officer in June 2024.

	●	Andrew Schwartz, a respected financial industry veteran and credit, debt and equity financing expert, was elected as a member of the Company’s board of directors. Mr. Schwartz stepped down in June 2024.

	●	Robert Arigo, a respected hotelier was appointed as Chief Executive Officer of the Company in June 2024.

	●	Michael James, a respected financial industry veteran was appointed as Chief Financial Officer in June 2024.

Capital Raises

On May 23, 2024, the Company sold 35,075,000 common shares for $8,768,750 netting $7,026,437 after fees.

On June 27, 2024, the Company sold 8,000,000 common shares and 8,000,000 rights for $2,000,000 netting $1,834.000 after fees.

On July 18, 2024, the Company sold 4,500,000 common shares for $765,000 netting $703,800 after fees.

On July 31, 2024, the Company sold 11,573,333 common shares for $1,736,000 netting $1,530,800 after fees.

In August 2024, the Company has raised through the sale of convertible debt $3,012,000 netting $2,815,000 after fees.

As part of the foregoing transitions, the Company entered into a Nonexecutive Chairman of the Board Agreement with Mr. Blutinger for a term of three years and will pay him an annual fee of $100,000 cash and issue him an annual grant of 250,000 shares of our common stock (each such grant vesting in three equal annual installments).

As part of the foregoing transitions, the Company entered into a Consulting Agreement with Mr. Ferdinand for a term of three years and will pay him a monthly consulting fee of $50,000, and continue material compensation and other terms of the employment agreement between our company and Mr. Ferdinand that was in effect immediately prior to April 22, 2024.

Amended and Restated Claw Back Policy

In November 2023, the Company adopted a claw back policy that provides for the recovery, or “claw back”, of erroneously awarded incentive-based executive compensation, as required by Rule 10D-1 under the Securities Exchange Act of 1934 (“Rule 10D-1”) and the Nasdaq listing requirements. In April 2024, the Company adopted a restated and amended version of that policy to add immaterial but clarifying provisions.

Sale Restriction Waiver

In April 2024, the Company secured from Greenle Partners LLC Series Alpha P.S. (“Greenle Alpha”) and Greenle Partners LLC Series Beta P.S. (“Greenle Beta” and, together with Greenle Alpha, “Greenle”) a waiver on the restrictions contained in its financing agreements with the Company that prohibits the Company’s sales of shares of common stock prior to November 2024 at per-share prices below $5.00 (as may be adjusted for stock splits and similar transactions, the “Trigger Price”). The restriction on sales of common stock by the Company below the Trigger Price terminates in November 2024. This waiver permitted the Company to sell up to an aggregate of 15 million shares prior to November 2024 at prices below the Trigger Price. In consideration of this waiver, Greenle is entitled to be issued up to an aggregate of 2.8 million shares of our common stock (“Initial Greenle Waiver Shares”) from time to time upon written notice to our company. This waiver was amended in May 2024 to increase number of shares permitted to be sold by the Company at prices under the Trigger Price prior to November 2024 to the greater of (i) 30 million shares and (ii) $30 million (based on the gross sale prices of such shares). In consideration of this waiver modification, Greenle is entitled to demand from time to time that the Company issue an amount of additional shares (the “Additional Greenle Waiver Shares” and collectively with the Initial Greenle Shares and the Greenle Revenue Participation Shares, the “Greenle Shares”) equal to 0.22 shares of common stock for each share of common stock sold by the Company through November 6, 2024 in excess of 15 million shares at prices below the Trigger Price.

Termination of Partnership Agreement

At this time, we have recorded the Development Incentive Advances as a current liability from long-term on our Condensed Consolidated Balance Sheets as well as included an additional $2.6 million in accruals for all of the costs and potential additional liabilities related to this transition on our Condensed Consolidated Statement of Operations. However, we believe it is in the best interest of both parties to mutually work out an agreeable outcome for the complete settlement of this matter.

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

When we refer to “we,” “us,” “our,” “LUXH,” or “the Company,” we mean LuxUrban Hotels Inc. and its consolidated subsidiaries. You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and the related notes included elsewhere in this quarterly report on Form 10-Q (“Quarterly Report”). Some of the comments we make in this section are forward-looking statements within the meaning of the federal securities laws. For a complete discussion of forward-looking statements, see the section below entitled “Special Note Regarding Forward-Looking Statements.” Certain factors that could cause actual results or events to differ materially from those the Company anticipates or projects are described in “Item 1A. Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 (“Annual Report”).

Special Note Regarding Forward-Looking Statements [to be review by counsel]

This Quarterly Report contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The statements contained in this Quarterly Report that are not purely historical are forward-looking statements. Forward-looking statements include, but are not limited to, statements regarding expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipates,” “believes,” “continues,” “could,” “estimates,” “expects,” “intends,” “may,” “might,” “plans,” “possible,” “potential,” “predicts,” “projects,” “should,” “would” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this Quarterly Report may include, for example, statements about:

●

our ability to secure equity or debt capital resources as needed to stabilize our business and continue our expansion;

●

the potential effects on our business from pandemics, such as those experienced during the COVID-19;

●

the potential effects of a challenging economy, for example, on the demand for vacation travel accommodations such as ours;

●

the ability of our short-stay accommodation offerings to achieve and sustain market acceptance across multiple cities throughout the United States and internationally;

●

the impact of increased competition;

●

the need to geographically centralize principal operations.

●

our efforts to identify, recruit and retain qualified officers, key employees, and directors possessing experience in the hotel and online travel services industries;

●

our ability to service our existing indebtedness and Series A Preferred Stock dividend and to obtain additional financing, including through the issuance of equity and debt, when and as needed on commercially reasonable terms;

●

our ability to protect our intellectual property;

●

our ability to complete strategic acquisitions, including joint ventures;

●

the need to obtain uninterrupted service from the third-party service providers we rely on for material aspects of our operations, including payment processing, data collection and security, online reservations, and booking and other technology services;

●

the effects of employment, labor union, and customer related litigations and disputes that may arise from time to time in the course of our operations and our efforts to minimize and resolve same;

●

the liquidity and trading of our securities;

●

regulatory and operational risks;

●

our estimates regarding expenses, future revenue, capital requirements and needs for additional financing; and

●

the time during which we will be an Emerging Growth Company (“EGC”) under the Jumpstart Our Business Startups Act of 2012, or JOBS Act.

The forward-looking statements contained in this Quarterly Report are based on current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments will be those that have been anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those risk factors described in “Item 1A. Risk Factors” of our Annual Report, elsewhere in this Form 10-Q and any updates to those factors as set forth in this and subsequent Quarterly Reports on Form 10-Q or other public filings with the SEC. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements.

See Item 1A. “Risk Factors” within our Annual Report for further discussion of these risks, as well as additional risks and uncertainties that could cause actual results or events to differ materially from those described in the Company’s forward-looking statements. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such statements, which speak only as of the date of this Quarterly Report. The Company undertakes no obligation to publicly release any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date of this Quarterly Report.

Overview

We lease entire existing hotels on a long-term basis and rent out hotel rooms in the properties we lease. We currently have a portfolio of hotel rooms in New York, Miami Beach, New Orleans, and Los Angeles through long-term lease agreements and manage these hotels directly. Our revenues are generated through the rental of rooms to guests and through ancillary services such as cancellable room rate fees, resort fees, late and early check-in and check-out fees, baggage fees, parking fees, grab and go food service fees, and upgrade fees. As of the date of this Annual Report, we have 1,406 hotel rooms available for rent through our portfolio. We believe the COVID-19 pandemic created, and current economic conditions continue to present, an historic opportunity for us to lease additional dislocated and underutilized hotels at favorable economics for our company. We have been expanding our domestic operations and U.S.-based portfolio of available hotel rooms since inception, with our next planned target city being Boston, and have plans to open one or more international markets in the near term, with London as the initial target international market.

We strive to improve operational efficiencies by leveraging proprietary technology to identify, lease, manage, and market globally the hotel space we lease to business and vacation travelers through our online portal and third-party sales and distribution channels. Our top three sales channels represented more than 85% of revenue during the three month ended March 31, 2024 and more than 85% of revenue during the three months ended March 31, 2023.

Our company has been engaged in a dedicated effort to enhance our management and operations teams through the recruitment of talented directors and officers who have meaningful and broad experience in the hotel and online travel services industries, as well as business development expertise. These efforts have included the recently announced additions of Elan Blutinger and Kim Schaefer, hotel and travel technology veterans, to our board of directors. We are continuing the efforts to deepen management and operational experience across all areas of our company through active recruitment of new personnel and the assignment of existing management personnel to areas in which their expertise can be focused.

General

We have been and are continuing to build a portfolio of existing hotels that provide short-term accommodations for guests at average nightly and occupancy rates that exceed our total cost and expenses. We are growing this portfolio by capitalizing on the dislocation in the hotel industry created by the COVID-19 pandemic and the high interest rate environment. We target business and vacation travelers under our consumer brand LuxUrban and we market our hotel properties primarily through numerous third-party online travel agency (“OTA”) channels and our own listing platforms. See Note 19 to our Financial Statements included in this Report.

Many of the hotels that we lease are hotels that were shuttered or underutilized as a result of the global pandemic. Other properties that we lease were either poorly managed prior to our acquisition, which caused landlords to seek a more stable tenant, or became attainable when LuxUrban provided landlords with more desirable long-term lease terms and prospects than other potential tenants.

Currently, we focus our portfolio expansion efforts on turnkey properties that require limited amounts of incremental capital to make the property guest-ready. We expect over time that we may need to invest additional capital as prime hotel lease acquisition opportunities diminish, but believe there will remain many attractive opportunities for properties where the economics will still be favorable despite the additional capital investment requirements. In these cases, we believe we will be able to obtain greater concessions from landlords as a result of the capital outlays that would be required from us.

Property Summary

We enter into triple net leases in which we are responsible for all of the costs on the property outside of exterior structural maintenance. As of December 31, 2023, we leased 18 properties with 1,599 units available for rent. In March 2024 and in April of 2024, we surrendered four of these hotels, based on our evaluation that such properties (a) had relatively poor performance, (b) presented suboptimal size and scale, and (c) are of general quality that over time could present risks to our company. After giving effect to the surrender of these properties, we leased 13 properties with 1,341 units available for rent. We are in active negotiations with one or more of the hotels we surrendered in March 2024 for modified lease terms that would allow such hotels to work within our operating model, but there is no assurance that we will obtain the terms desired or that if we do we will not replace these hotels with other hotels that we believe present greater opportunity for our company. In addition, in late 2023, we elected to not move forward on a previously agreed to long-term lease for a hotel because required repairs had not been timely completed by the landlord.

Our portfolio of properties as of March 31, 2024 (as adjusted for the surrender of certain properties mentioned above) was as follows:

Property

# of Units

Property Type

Lease Term

Lease
Remaining at 3/31/24
(years)

Extension
Option
(remaining at 3/31/24)

Annual
Escalation

Date
Commenced

Blakely: 136 W 55th St, New York, NY 10105

117

Licensed hotel

15-year

12.6

10-year

11/1/2021

Herald: 71 W 35th St, New York, NY 10001

168

Licensed hotel

15-year

13.2

None

6/2/2022

Variety: 1700 Alton Rd Miami Beach, FL 33139

Licensed hotel

12.5-year

9.6

None

3/26/2021

Lafayette: 600 St Charles Ave, New Orleans, LA 70130

Licensed hotel

19.4-year

18.0

None

11/1/2022

Townhouse: 150 20^thSt., Miami Beach, FL 33139

Licensed hotel

11.25-year

10.2

10-year

3/1/2023

Tuscany: 120 E 39^thSt., New York, NY 10016

125

Licensed hotel

15-year

13.8

10-year

1/1/2023

O Hotel: 2869 819 Flower St, Los Angeles, CA 90017

Licensed hotel

15-year

14.0

5-year

4/1/2023

Hotel 57: 2869 130 E 57^thSt., New York, NY 10022

216

Licensed hotel

15-year

14.3

10-year

7/1/2023

Condor: 56 Franklin Ave, Brooklyn, NY 11205

Licensed hotel

15-year

14.4

10-year

9/1/2023

BeHome: 56 765 8^thAve, New York, NY 10036

Licensed hotel

25-year

24.3

None

10%

7/1/2023

Hotel 46: 129 West 46^thSt., New York, NY 11206

Licensed hotel

25-year

24.6

None

11/1/2023

Hotel 27: 62 Madison Ave, New York, NY 10016

Licensed hotel

15-year

14.6

10-year

11/1/2023

Washington: 8 Albany Street, New York, NY 10006

217

Licensed hotel

15.2-year

13.9

None

9/20/2022

Weighted Avg.

Operating Units as of 3/31/2024⁽¹⁾

1,341

14.9

14.5

19.5

2.9%

Due to the triple-net structure of our leases, we are typically responsible for the interior maintenance of our properties, and the landlord is responsible for the exterior maintenance and roof. When we enter into new property leases, we target leases of 10 to 15 years with 5- to 10-year extension options. We try to keep annual escalations of between 2 to 3% fixed and none of our leases at March 31, 2024, are tied to inflation or CPI.

As a matter of course, from time to time we become, and are currently, involved in disputes with landlords for certain hotel properties. The complexity of each lease for each of our hotels requires us to be diligent with respect to the terms of each lease, including deposit requirements, deliverables, and management and maintenance terms, among other terms and covenants. A dispute under a lease can range from minor issues to issues that could give rise to claims of default by us or the landlord under the lease. Currently, we have defaults across certain properties totaling 216 keys, all of which we believe are in the process of being cured and which will be cured in the near term. In the event we are unable to cure our default under a lease, an event of default could ultimately be declared by the landlord thereunder, with the landlord then having remedies that include the right to terminate the lease. Where landlords have breached and have not cured, we may be required to litigate to protect our rights under one or more leases, which could divert management attention from our regular operations and could be costly to our company without any guarantee of success in the action.

Our Business Strategy

When we lease properties, we typically do so with either a refundable security deposit, refundable letter of credit, or both. In most cases, we get a period of “free rent” in which we “make ready” the property. Our make-ready efforts include, but are not limited to, minor repairs or property updates, hiring appropriate property-level staff, installation of utility, Wi-Fi, Internet and cable services, and listing the property on the OTA channels we utilize. We anticipate that in the near future, we will also utilize surety bonds for the funding of lease deposit requirements. In March 2024, we entered into an agreement with Berkley Insurance Company (“Berkley”) pursuant to which Berkley will provide us with up to an aggregate of $10 million in surety bonds that can be used to fund deposit requirements under long-term hotel leases. The bonds have a 70% collateral requirement. For example, a $1,000,000 bond would require us to maintain a collateral position of $700,000, which can be deposited in either cash or in the form of a letter of credit. In addition to collateral, we entered into an agreement of indemnity with Berkley. The bonds will cost 2.5% of the penalty amount of each bond annually.

We lease entire properties, which could include food service, gyms, or store fronts. We currently, and in the future plan to, in most cases, sublease food services and hotel-based store fronts to generate additional income. We believe these items are noncore to our operations.

Our average deposits (including letters of credit) by city as of March 31, 2024, as adjusted for the surrender of certain properties in March 2024 (as discussed above), were as follows:

Location	Miami Beach		New York		LA		NOLA		Total
Units		138		1,075		68		60		1,341
Deposit	$	1,750,000	$	15,933,113	$	400,000	$	300,000	$	18,383,133
Per Unit	$	12,681	$	14,822	$	5,882	$	5,000	$	13,709

Revenue Management

We use our proprietary data science and algorithms to manage revenue and create dynamic pricing for our accommodation units. Pricing changes can occur multiple times a day based on revenue momentum or lack thereof. We utilize our technology to both maximize occupancy rates through attractive pricing and increase cash flow in advance of potential guest stays. We initially developed and further improved our revenue management algorithms in our legacy apartment rental business and have now applied it to our hotel operations.

Property Operations

When we lease a new property, we typically streamline operations from the manner in which the property was managed by the prior operator by taking numerous measures, including but not limited to:

●

Reduction of staffing. Legacy properties we lease often have staffing at levels higher than we typically operate our properties. In addition to paring staff to ensure efficient operation, we eliminate staffing for areas we do not plan to operate initially or at all, including in hotel-based restaurants, bars, and workout facilities.

●

Hiring quality general manager (or GM). We believe that our operational success is partially related to empowering our employees to make decisions and solve guest concerns. This begins with a quality and experienced GM with a background in hospitality.

●

Continual cost-benefit analysis. Our lead operational staff have been trained to continuously calculate cost benefit in our operations. Specifically, we are constantly reviewing the return on requested investment capital and the related payback. We do this both at the corporate level as well as the operational level. For example, during lower periods of occupancy, we may delay certain maintenance items as during these periods we can remove these units from inventory for a more prolonged period without experiencing any impact to revenues or the guest experience.

Unit Economics

We believe we have one of the lowest per-night, property-level break-even costs in our markets as a result of leasing our properties at generationally favorable terms. We estimate that the property-level break-even rate for total revenue per available room (or TRevPAR) for our portfolio as of December 31, 2023, was between $160 to $180 a night. We define TRevPAR as total revenue received by our company inclusive of room rental rates, ancillary fees (which include but are not limited to resort fees, late/early check-in, baggage fees, parking fees paid to us, and upgrade fees), cancellation fees, taxes (including other pass-through expenses) and other miscellaneous income received by us, divided by the average available rooms for rent during a given period.

The following table shows historical occupancy and TRevPAR at our leased properties:

Year	Occupancy			TRevPAR
2018		86	%	$	160
2019		84	%	$	157
2020		61	%	$	103
2021		72	%	$	122
2022		77	%	$	247
2023		79	%	$	249
2024 YTD		77	%	$	208

During the fourth quarter of 2023, our business was significantly impacted by our transition of our property rental listings to a third-party platform because such properties were taken off our prior OTAs and unavailable for rent during such transition. The amounts above are not adjusted by our estimate of this impact.

Our early historic operations involved the leasing of units within multifamily properties. In late 2021, we began to transition our business to focus on leasing hotel properties in commercially-zoned areas, and we have completed this transition. As a result, we believe that our historical financial and operating results (in particular for the years 2018 through 2021), including operating metrics such as occupancy rate and TRevPAR, are not indicative of our current and future operations. We do believe, however, that the above table is useful in illustrating the higher TRevPAR and improved results that we can achieve as a result of our hotel-centric business strategy.

Overall Hospitality Market

Since early 2022, we, along with the broader lodging industry, have experienced a steady recovery of demand for our properties in all of our markets. As a result, we have been able to increase our average daily rates during this period. Outside of post year-end seasonality, we continued to experience this recovery in 2023 and into 2024. We believe this trend will continue despite recessionary fears due to rising inbound international travel, including the anticipated opening of Chinese travel, which had a significant impact on our business in 2023, which impact should continue in 2024.

Seasonality

Operations at hotel properties in general have historically been seasonal in nature, reflecting lower revenues and occupancy rates during the first quarter of each year when compared to the remaining three quarters. In 2023 and 2024 we experienced such seasonality with respect to our properties. While the foregoing is based on only limited historical data with respect to the seasonality of our business, we expect that this seasonality may continue to cause fluctuations in our quarterly operating revenues, profitability, and cash flow.

Competition

The U.S. hotel industry is highly competitive. Our hotels compete with other hotels for guests in each of their markets on the basis of several factors, including, among others, location, quality of accommodations, convenience, brand affiliation, room rates, service levels and amenities, and level of customer service. In addition to traditional hotels, our properties also compete with non-traditional accommodations for travelers such as online room sharing services. Competition is often specific to the individual markets in which our hotels are located and includes competition from existing and new hotels.

Our competition also includes online and offline travel companies that target leisure and corporate travelers, including travel agencies, tour operators, travel supplier direct websites and their call centers, consolidators and wholesalers of travel products and services, large online portals and search websites, certain travel metasearch websites, mobile travel applications, social media websites, as well as traditional consumer ecommerce and group buying websites. We face these competitors in local, regional, national and/or international markets. We also face competition for customer traffic on internet search engines and metasearch websites, which impacts our customer acquisition and marketing costs.

However, while we expect new competitors may arise, we expect that we will continue to enjoy a competitive advantage over new competitors. We believe this to be the case because of:

●

Our ability to identify hotel properties available for lease on terms that work within our operating plan, the speed at which we can close on leases for new properties and thereafter commencing the marketing and renting of rooms therein;

●

our experience and track record of quickly opening, listing, and marketing properties,

●

the existing and growing operational skillset and experienced brought by our management terms and day-to-day property managers, and

●

our reputation within the industry.

Human Capital

As of March 31, 2024, we had a total of 509 full-time employees, 291 of which are unionized. We believe that our corporate culture and employee relationships are healthy and productive.

Our operations are overseen directly by a management team that encourages our employees to take a long-term approach to our business. We may expand our current management to retain other skilled employees with experience relevant to our business. Our management’s relationships will provide the foundation through which we expect to grow our business in the future.

Our future success is dependent in part on our continued ability to attract, hire and retain qualified personnel. Therefore, investing, developing and maintaining human capital is critical to our success. The Company strives to provide its employees with a safe and healthy workplace. We have recently accelerated initiatives to recruit and retain directors and officers that bring additional hotel and online travel industry expertise to our management and day to day operations.

We are an equal opportunity employer and it is our company’s policy to recruit, hire, train and promote personnel in all job classifications, without regard to race, religion, color, national origin, sex or age. We are committed to inclusivity and diversity across our entire operation and to fostering a culture where everyone feels empowered to do their best work. Cultivating a diverse and inclusive workplace helps us embrace different perspectives, talents and experiences. We believe achieving a culture of integrity and transparency starts with leadership and encourages every employee to work in support of our company’s goals. Continuous employee engagement helps us understand our employees’ perspectives and identify areas for additional focus.

The majority of our employees are currently represented by labor unions and/or covered by collective bargaining agreements. We may in the future acquire additional portfolios of units in other hotels or other building serviced by organized or unionized labor. In addition, union, worker council, or other organized labor activity may occur at other locations we already lease. Under the applicable agreements with labor unions or collective bargaining agreements, we are obligated to provide enhanced severance benefits that, in certain circumstances, may have to be paid upon termination of employment of hotel employees who are members of a union. We cannot predict the outcome of any labor-related proposal or other organized labor activity. Increased unionization of our workforce or other collective labor action, new labor legislation or changes in regulations could be costly, reduce our staffing flexibility or otherwise disrupt our operations, and reduce our profitability. While we have not experienced work stoppages to date, from time to time, hospitality operations may be disrupted because of strikes, lockouts, public demonstrations or other negative actions and publicity involving employees and third-party contractors. We may also incur increased legal costs and indirect labor costs because of disputes involving our workforce. Additionally, from time to time we are subject to arbitration conducted under applicable union regulations and cold be subject to various arbitration rulings. We are subject to various union agreements and among other obligations are required to provide the applicable unions with data on the size and scope of our operations and the number of employees at each applicable property and to post a bond covering at least three months of employee wages for each property. We are also subject to a payment schedule with NYHTC with respect to accrued pension, health, and union employee related obligations aggregating approximately $3 million as of the date of this Annual Report on Form 10-K that were not remitted on our behalf during the last part of 2023 (during a gap period resulting from our company’s switch to a new payroll service provider), through which we are obligated to make monthly payments until the accrued amount is fully paid down.

Intellectual Property (Trademarks and Patents)

We have filed for eight trademarks, including with respect to the “LuxUrban” brand. We intend to use these and other trademarks in building our brand, proprietary corporate philosophies in creating our operations and guests experiences, and certain proprietary technology, applications and databases and know how in our operations. As a result, our success depends in part on our ability to operate without infringing upon the proprietary rights of others, and to prevent others from infringing upon our proprietary rights. Our policy is to seek to protect our proprietary position by, among other methods, filing U.S. trademark and copyright applications, nondisclosure and assignment of invention agreements with employees, and enforcing our rights as applicable. We also rely on trade secrets, know-how, and continuing technological innovation and may rely on licensing opportunities to develop and maintain our proprietary position.

Regulation

We must ensure regulatory compliance in our operations across numerous jurisdictions.

Property and Accommodations Regulation

Our business is subject to U.S. federal, state and local and foreign laws and regulations that vary widely by city, country and property type. Hospitality accommodations operations are also subject to compliance with the U.S. Americans with Disabilities Act and other laws and regulations relating to accessibility, and to laws, regulations and standards in other areas such as zoning and land use, licensing, permitting and registrations, fire and life safety, environmental and other property condition matters, staffing and employee training, cleaning protocols and other COVID-19 requirements, and property “star” ratings where required. Additionally, our real estate owners are also typically responsible for their own compliance with laws, including with respect to their employees, property maintenance and operations, environmental laws and other matters.

When signing leases in a new market, we engage local legal counsel to help identify relevant regulatory requirements. The efforts of local counsel include analysis on licensing and zoning, building code, accessibility and operations requirements, fire and life safety regulations, tax compliance, and local employment laws. Every leased property has unique characteristics, requiring further due diligence and regulatory analysis before each new lease signing.

We monitor regulatory changes in each existing market on an ongoing basis. To facilitate our growth and compliance work in each city, we attempt to establish relationships with local regulatory agencies, elected officials, business and community groups to build trust and improve understanding of our business model.

Our growing portfolio of accommodation units are comprised of units in entire hotels we lease on a long-term basis. Our hotel units are located in commercially zoned areas. Hotel units enjoy the benefits of commercial zoning, allowing for short-stay rentals of any length, even as a short as one day. As commercially zoned buildings are not typically subject to local short-stay length regulation, we are able to offer the vast majority of our accommodation portfolio with maximum flexibility in terms of stay length.

Privacy and Data Protection Regulation

In processing travel transactions and information about guests and their stays, we receive and store a large volume of personally identifiable data. The collection, storage, processing, transfer, use, disclosure and protection of this information are increasingly subject to legislation and regulations in numerous jurisdictions around the world, such as the European Union’s General Data Protection Regulation (“GDPR”) and variations and implementations of that regulation in the member states of the European Union, as well as privacy and data protection laws and regulations in various U.S. States and other jurisdictions, such as the California Consumer Privacy Act (as amended by the California Privacy Rights Act), the Canadian Personal Information Protection and Electronic Documents Act (“PIPEDA”), and the UK General Data Protection Regulation and UK Data Protection Act. We have implemented a variety of technical and organizational security measures and other procedures and protocols to protect data, including data pertaining to guests and employees, and we are engaged in an ongoing process of evaluating and considering additional steps to comply with the California Consumer Privacy Act, GDPR, PIPEDA, the UK General Data Protection Regulation, and UK Data Protection Act.

Employment

We are also subject to laws governing our relationship with employees, including laws governing wages and hours, benefits, immigration, workplace safety and health, and hotel-specific ordinances.

Other Regulation

Our business is subject to various other laws and regulations, involving matters such as income tax and other taxes, consumer protection, online messaging, advertising and marketing, the U.S. Foreign Corrupt Practices Act and other laws governing bribery and other corrupt business activities, and regulations aimed at preventing money laundering or prohibiting business activities with specified countries or persons. As we expand into additional markets, we will be subject to additional laws and regulations.

The regulatory environment in each market is often complex and evolving, and can be subject to significant change. Some relevant laws and regulations are inconsistent and ambiguous, and could be interpreted by regulators and courts in ways that could adversely affect our business, results of operations, and financial condition. Moreover, certain laws and regulations have not historically been applied to businesses such as ours, which often makes their application to our business uncertain.

Non-Hotel Properties

In 2021 we commenced efforts to transition our operations away from the renting of rooms in residential multifamily buildings. These units are subject to short-term rental regulations, which can be difficult to ascertain, accurately interpret, and apply. We substantially completed this transition by the end of 2022 and our current operations focus solely on hotel-based room rental units.

Corporate Information

Corphousing LLC (“Corphousing LLC”) was formed on October 24, 2017, as a Delaware limited liability company. In January 2022, Corphousing LLC converted into a C corporation, with the members of Corphousing LLC becoming the stockholders of CorpHousing.

The conversion had no effect on our business or operations and was undertaken to convert the form of the legal entity into a corporation for purposes of operating as a public company. All properties, rights, businesses, operations, duties, obligations, and liabilities of the predecessor limited liability company remained those of CorpHousing Group Inc.

On November 1, 2022, we filed an amendment to our certificate of incorporation with the Secretary of State of the State of Delaware, changing the name of our company from “CorpHousing Group Inc.” to “LuxUrban Hotels Inc.” On December 30, 2022, we dissolved SoBeNY, which was the entity that covered our legacy apartment rental business. We substantially exited the residential-based rental business prior to year-end 2022.

Results of Operations

	For The Three Months Ended March 31,
	2024, as restated			2023			% ∆ YoY
Net Rental Revenue	$	13,957,361		$	22,814,175			(39	)%
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			104	%
Gross (Loss) Profit		(21,580,936	)		5,361,874			(502	)%
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			278	%
Income (Loss) from Operations		(37,585,488	)		1,136,903			(3,406	)%
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	)		21	%
Loss Before Benefit from for Income Taxes		(42,159,482	)		(2,658,373	)		1,486	%
Provision for Income Taxes		-			122,161
Net Loss	$	(42,159,482	)	$	(2,780,534	)		1,416	%

Three Months Ended March 31, 2024, as restated, as compared to Three Months Ended March 31, 2023

Net Rental Revenue

The decrease in net rental revenue of 39% for the three months ended March 31, 2024 to $14.0 million as compared to $22.8 million for the three months ended March 31, 2023 was a result of the decrease in average units available to rent from 571 for the three months ended March 31, 2023 to 1,535 for the three months ended March 31, 2024 partially offset by lower RevPAR, or revenue per available room, from $257 for the three months ended March 31, 2023 to $208 for the three months ended March 31, 2024. The lower RevPar in the current quarter is attributable to the overall unit mix as well as the impact on our business from the partnership we exited in April of 2024. RevPAR includes both average daily rate (“ADR”) and occupancy.

Cost of Revenue

For the three months ended March 31, 2024, the principal component responsible for the increase in our cost of revenue was expenses for our units available to rent, which increased by $18.1 million, or 104%, from $17.5 million in the three months ended March 31, 2023, to $35.5 million in the three months ended March 31, 2024, as a result of the increased number of units as well as related increases in property-related costs such as utilities, labor, cable / WIFI costs and cost related to greater revenues such as credit card processing fees and commissions as well as greater costs associated with the surrender of properties such as, deposit surrenders and greater commissions to relocate guests.

Gross Profit

The decrease in our gross profit of $26.9 million, or approximately 502%, to ($21.6) million for the three months ended March 31, 2024, as compared to $5.4 million for the three months ended March 31, 2023, is primarily attributable greater costs associated with the surrender of properties such as, deposit surrenders and greater commissions to relocate guests as well as greater number of units and lower RevPAR over these periods.

Total Operating Expenses

Total operating expenses incurred for the three months ended March 31, 2024, increased by approximately $11.8 million from the three months ended March 31, 2023. Of this increase, $3.5 million were for costs related to the exit of our partnership, which did not occur in the three months ended March 31, 2023. The Company recorded bad expense in the amount of $7.8 million in the three months ended March 31, 2024. The balance of this increase was primarily related to greater units and related corporate staffing.

Other Income (Expense)

Total other expense for the three months ended March 31, 2024 was $4.6 million as compared to $3.8 million for the three months ended March 31, 2023. This increase is primarily due to higher cash interest and financing costs during the three months ended March 31, 2024 as compared with three months ended March 31, 2023 partially offset by greater non-cash financing costs.

Liquidity and Capital Resources

The following table provides information about our liquidity and capital resources as of March 31, 2024 and December 31, 2023:

	As of March 31, 2024			As of December 31, 2023
Cash and Cash Equivalents	$	994,904		$	752,848
Other Current Assets	$	4,009,370		$	18,968,209
Total Current Assets	$	5,004,274		$	19,721,057
Total Current Liabilities	$	61,994,101		$	33,125,741
Working Capital (Deficit)	$	(56,939,827	)	$	(13,404,684	)

As of March 31, 2024, our cash and cash equivalents balance was $994,904 as compared to $752,848 at December 31, 2023, and total current assets were $5,004,274 at March 31, 2024, as compared to $19,721,057 at December 31, 2023.

As of March 31, 2024, our company had total current liabilities of $61,994,101 as compared to $33,125,741 at December 31, 2023. Total current liabilities at March 31, 2024 consisted of: accounts payable and accrued expenses of $30,779,912 as compared to $23,182,305 at December 31, 2023; rents received in advance of $14,626,651 at March 31, 2024, as compared to $4,404,216 at December 31, 2023; short-term business loans of $3,733,417 at March 31, 2024, as compared to $1,115,120 at December 31, 2023; loans payable of $1,666,108 at March 31, 2024, as compared to $1,654,589 at December 31, 2023; operating lease liability of $1,944,026 at March 31, 2024, as compared to $1,982,281 at December 31, 2023; and development incentive advances of $8,893,987 at March 31, 2024 as compared to $300,840 at December 31, 2023.

As of March 31, 2024, our company had a working capital deficit of $56,939,827 as compared to a deficit of $13,404,684 at December 31, 2023.

We have obtained funding through the Small Business Administration (“SBA”) Paycheck Protection Program (“PPP”) and Economic Injury Disaster Loans (“EIDL”) totaling $814,244 and $800,000, respectively. We have used these funds for our ongoing operations. We have received forgiveness of $516,225 of the PPP loans, and for the balance of these funds we intend to repay them in accordance with the terms of the respective loan agreements or seek forgiveness, as permitted.

We record cash collected prior to stays as “bookings received in advance” on our balance sheet as a liability. These collections are then recognized as revenue when guests stay at our properties. In the event that there is a refund in accordance with our refund policy, revenue is not recognized.

Our current liquidity position raises substantial doubt about our ability to continue as a going concern. If we are unable to improve our liquidity position we may not be able to continue as a going concern. Our ability to raise the capital needed to improve our financial condition may be hindered or limited by provisions contained in our existing financing agreements or other agreements. The accompanying consolidated financial statements do not include any adjustments that might result if we are unable to continue as a going concern and, therefore, be required to realize our assets and discharge our liabilities other than in the normal course of business which could cause investors to suffer the loss of all or a substantial portion of their investment.

Our company is still in the relatively early stages of growth, the resources needed for the management and operation of our portfolio of hotels is relatively similar to larger, long-standing and well-capitalized companies, such as Marriot, Hyatt, and Hilton. To operate our existing portfolio of hotels and continue our expansion of our portfolio of hotels in major cities will require substantial capital resources and will require us to utilize our cash flows, and will likely require us to engage in equity or debt transactions to fund required expenditures if we choose to continue expansion at our historic or an accelerated pace.

The operation of many of our properties involves unionized labor. Unionized labor provides us with skilled employees that are trained, vetted by their unions, and subject to the performance and conduct codes established by their unions. It also provides us with formal channels to resolve various labor issues. At the same time, with respect to properties utilizing unionized labor, we are subject to labor agreements and requirements applicable to companies of our size and capital profile, including requirements that require us to post deposits or bonds with respect to three-month union employee wages for each such hotel. The funding of these deposits and bonds require substantial capital.

Inflation

Historically, inflation has not had a material effect on our results of operations. However, significant increases in inflation, particularly those related to wages and increases in interest rates could have an adverse impact on our business, financial condition and results of operations.

Going Concern

Financing Activities

Since formation we have funded our operations and growth through capital contributions and loans from affiliates of our company, third-party investor financings, and our initial public offering. At March 31, 2024, we had short-term business financing indebtedness of $3,733,417, short-term loans payable of $1,666,108, and long-term loans payable of $1,447,720. The proceeds from these financings have been or will be used to fund security deposits for our newly leased properties.

Affiliate Financings

In November 2023, our company entered into a non-dilutive financing agreement with THA Holdings LLC (“THA”), an entity controlled and operated by Mr. Ferdinand, pursuant to which the Company agreed to issue to the THA an unsecured, advancing term promissory note (the “THA Note”). Under the THA Note, we were able to borrow, up to an aggregate principal amount of $10,000,000 (the “Initial Principal Amount”) to be funded in increments of $1,000,000 upon on request by the sale, from time to time, of shares of our common stock owned by THA. The interest on the THA Note was to be compounded annually and the THA Note was repayable at maturity in November 2026.

As a result of our company entering into a relationship with Wyndham Hotels & Resorts, in December 2023, we and THA mutually agreed to cancel the THA Note, pursuant to a payoff letter, dated December 3, 2023 (the “Payoff Letter”). In connection therewith, an amount equal to the proceeds resulting from recent sales by THA common stock under the terms of the THA Note in the amount of approximately $311,234 was gifted to the Company. This was recorded as a contribution by founder in the accompanying consolidated statement of equity.

In December 2022, our company and Mr. Ferdinand entered into a Note Extension and Conversion Agreement with Greenle. Greenle was previously the purchaser of 15% OID senior secured notes (“Extension Notes”) and warrants to purchase our common stock under certain securities purchase agreements and loan agreements between us and Greenle. Under the terms of the Note Extension and Conversion Agreement, Greenle agreed to convert from time to time up to $3,000,000 aggregate principal amount of the notes into up to 1,000,000 shares of our common stock (the “Conversion Shares”) at the conversion price of $3.00 per share prescribed by the notes. Additionally, Greenle agreed that the payment date of certain of the notes in the aggregate principal amount of $1,250,000, maturing on January 30, 2023, would be extended to March 1, 2023. On the date of any such conversion, we would be obligated to issue to Greenle a number of credits under our then-existing revenue share agreements with them equal to fifteen percent (15%) of the principal amount of the notes so converted. As of December 31, 2022, $300,000 of these notes were converted and the entire $3,000,000 remaining amount under the notes was converted in January 2023. As part of this conversion, Mr. Ferdinand contributed to our company 874,474 shares of common stock owned by him and his affiliates, which in turn, were used by our company to fund the issuance of the Conversion Shares to Greenle in exchange for the conversion of the debt under the notes, which was maturing within a few months of this contribution. At the time of such contribution by Mr. Ferdinand, the market value of the shares of common stock so contributed was approximated $1.5 million.

In June 2022, Mr. Ferdinand personally provided us with an additional $750,000 of financing via a credit facility for operating expenses relating to the launch of certain of our newer properties, including the Astor Hotel and 1000 29th Street. This loan was evidenced by an unsecured, 24-month note, bearing interest at 6% per annum, with interest payable at maturity. We had the right to prepay this note at any time without prepayment penalty, subject to the terms of our other existing debt. In October 2021, we issued a promissory note (the “October 2021 Note”) to THA Family II LLC, an affiliate of our chief executive officer, in the principal amount of $2 million. As part of the note purchase we also issued warrants to purchase 250,000 shares of our common stock at an exercise price of $4.20. The October 2021 Note had a maturity date of April 15, 2023, and bared interest at the rate of 6% per annum, with such interest payable monthly in arrears in cash. At the close of our initial public offering, $1 million of the principal balance of this note was converted into 312,500 shares of our stock and remaining balance was repaid.

In May 2022, SuperLuxMia LLC, an entity controlled by our founder, chairman and chief executive officer, Brian Ferdinand, provided $661,000 in financing to our company for general operating expenses relating to the launch of our Marriott Herald Square property. This loan was evidenced by an unsecured, 24-month note, bearing interest at 6% per annum, with interest payable at maturity. We were entitled to prepay this note at any time without prepayment penalty, subject to the terms of our other existing debt, and this note was repaid in 2023.

In November 2021, we issued a promissory note (the “November 2021 Note”) to EBOL Holdings LLC, an entity controlled by a holder of more than 5% of our common stock, in the principal amount of $500,000. As part of the note purchase we also issued the investor warrants to purchase 125,000 shares of our common stock at an exercise price of $4.20 per share. The November 2021 Note had a maturity date of May 15, 2023. At the closing of our IPO, $200,000 of the November 2021 Note was repaid and the remaining balance was repaid in May of 2023.

Greenle Financings

At January 1, 2023, we had outstanding notes in the aggregate principal amount of $8,275,040 and warrants to purchase an aggregate of 2,156,250 shares of our common stock at a weighted average exercise price of $4.00, sold by us in various private placements to Greenle. In addition, we had revenues share arrangements with Greenle with respect to certain of our hotels, obligating us to pay to Greenle a prescribed share of our revenues generated by each such property (ranging initially from 10-14% of the subject property and scaling down to 1-3% over a ten-year period).

During 2023 and 2024, we consummated the transactions described below with Greenle which (a) eliminated our revenue share arrangements with Greenle, (b) eliminated our indebtedness to Greenle (and decreased our overall outstanding indebtedness), and (c) enhanced the equity capital of our company. As of December 31, 2023, as a result of the transactions described below, Greenle owned outstanding warrants to purchase an aggregate of 4,450,000 shares of our common stock at a weighted average exercise price of $4.79. As a result these transactions, Greenle also received the right to require us to issue up to an aggregate of 6,740,000 shares of our common stock to Greenle from time to time through August 2028, of which an aggregate of 2,800,000 shares had been issued as of the date of this report.

These transactions with Greenle in 2023 and 2024 included the following:

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In December 2022, Greenle agreed to convert $3 million principal amount and interest under the notes it held into shares of common stock at the conversion price of $3.00 per share prescribed by the notes. Additionally, Greenle agreed that the payment date of certain of the notes in the aggregate principal amount of $1,250,000, maturing on January 30, 2023, would be extended to March 1, 2023. On the date of any such conversion, we would be obligated to issue to Greenle a number of credits under our then-existing revenue share agreements with them equal to fifteen percent (15%) of the principal amount of the notes so converted. As of December 31, 2022, $300,000 of these notes were converted and the entire $3,000,000 remaining amount under the notes was converted in January 2023. As part of this conversion, Mr. Ferdinand contributed to our company 874,474 shares of common stock owned by him and his affiliates, which in turn, were used by our company to fund the issuance of the Conversion Shares to Greenle in exchange for the conversion of the debt under the notes, which was maturing within a few months of this contribution. At the time of such contribution by Mr. Ferdinand, the market value of the shares of common stock so contributed was approximately $1.5 million.

●

In January 2023, we prepaid $454,457 of the principal amount owed to Greenle under certain of the notes.

●

In February 2023, we issued to Greenle an aggregate of 2,457,002 shares of our common stock in exchange for the termination of our existing obligations to pay to Greenle an aggregate of $5 million for the last quarter of 2022 and all quarters in 2023 under revenue share rights previously granted to Greenle by us with respect to certain of our properties.

●

In February 2023, we entered into an exchange agreement (“Exchange Agreement”) with Greenle pursuant to which $2,079,686 principal amount of (and interest and prepayment premium relating thereto) owed by us to Greenle under certain notes was exchanged for a convertible 15% original issue discount note (“Exchange Note”) having a maturity date of August 17, 2023.

●

In March 2023, we repaid $808,000 of the principal amount of the Exchange Note and subsequent to this repayment the balance of the Exchange Note was converted into 196,994 shares of our common stock.

●

In April 2023 we entered into an agreement that provided for a two-year extension on maturity of all of our remining notes held by Greenle to April 15, 2025. In connection with this agreement, we issued Greenle warrants to purchase up to 1,000,000 shares of our common stock at an exercise price of $3.00 per share and warrants to purchase up to 250,000 shares of our common stock at an exercise price of $4.00 per share.

●

In April 2023, our company and Greenle also agreed to a modification of the terms of our outstanding notes and warrants requiring mandatory conversion of same into shares of our common stock if (a) the volume-weighted average price of our common stock for each of the three trading days prior to the forced conversion was at least equal to defined trigger prices (ranging from $2.00 to $5.50), (b) the shares underlying the notes and warrants were registered with the SEC for resale, (c) the aggregate dollar volume of the common stock sold on the principal trading market over the 10 consecutive days prior to conversion was at least $3.75 million, and (d) such mandatory conversion does not cause Greenle to beneficially own more than 9.9% of our common stock.

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In May 21 2023, we entered into an agreement (which was amended in April 2024) with Greenle pursuant to which Greenle’s revenue rights were terminated in 2024 and thereafter. In consideration for the termination of such rights, we agreed to issue to Greenle, from time to time, in each case at Greenle’s election upon ten business days’ prior written notice delivered to us on and before August 31, 2028, up to an aggregate of 6,740,000 shares of common stock (“Greenle Agreement Shares”), subject to resale restrictions limiting the amount Greenle may sell into the market during any calendar quarter. In 2023, we issued an aggregate of 614,250 shares of our common stock to Greenle pursuant to this obligation. In 2024, through the date of this Annual Report on Form 10-K, we have issued an additional 614,250 shares or our common stock to Greenle pursuant to this obligation

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In June 2023, Greenle agreed to convert all of the remaining notes held by it in exchange for a reduction in the exercise price of certain of its warrants to $2.50 per share.

●

In November 2023, in consideration of Greenle’s waiver of certain waive registration rights for any currently issued common stock held by it for a period of 12 months and any future issuances to it for a rolling 12-month period from the date such of issuance, we issued Greenle warrants to purchase up to an aggregate of 2,000,000 shares of common stock at an exercise price of $4.00 a share.

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In December 2023, Greenle agreed to exercise warrants to purchase an aggregate of 1,500,000 shares of our common stock at $4.00 per share. As consideration for this exercise, we issued new warrants to Greenle purchase up to 2,000,000 shares of our common stock at an exercise price of $5.00 per share and warrants to purchase up to 1,000,000 shares of our common stock at an exercise price of $5.50 per share.

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In April 2024, we secured from Greenle a waiver on the restrictions contained in its financing agreements with our company that prohibit our sale of shares of common stock prior to November 2024 at per-share prices below $5.00. This waiver permits us to sell up to an aggregate of 15 million shares prior to November 2024 at prices below $5.00 regardless of any prohibitions contained in our agreements with Greenle. The restriction on sales of our common stock by our company below $5.00 also terminates completely and forever in November 2024. In consideration of this waiver, Greenle is entitled to be issued up to an aggregate of 2.8 million shares of our common stock from time to time upon written notice to our company. We also revised the leak-out provisions applicable to the Greenle Agreement Shares (described above) by which Greenle shall only be permitted to resell Greenle Agreement Shares as follows:

(a) up to 20% of such shares may be sold on and after the date on which the shares are first issued to Greenle; (b) up to an additional 20% of the shares may be sold on after the date of each subsequent issuance to Greenle; and (c) all such shares may be sold without these restrictions on and after the date all Greenle Agreement Shares have been issued to Greenle. Our agreements with Greenle also prohibit issuances to Greenle under any of our agreements that would result in Greenle owning in excess of 9.9% of our then-outstanding common stock.

●

This waiver was amended in May 2024 to increase number of shares permitted to be sold by our company at prices under the Trigger Price prior to November 2024 to the greater of (i) 30 million shares and (ii) $30 million (based on the gross sale prices of such shares). In consideration of this waiver modification, Greenle is entitled to demand from time to time that we issue an amount of additional shares (the “Additional Greenle Waiver Shares” and collectively with the Initial Greenle Shares and the Greenle Revenue Participation Shares, the “Greenle Shares”) equal to 0.22 shares of common stock for each share of common stock sold by the Company through November 6, 2024 in excess of 15 million shares at prices below the Trigger Price.

Cash Flows from Operating Activities

During the three months ended March 31, 2024, we used $9,456,285 of cash in operating activities that was primarily related to an increase in prepaid expenses of $4,073,427, increase in security deposits of $1,050,000, offset by non-cash amount of lease expense of $10,146,639, modification of warrants of $2,036,200, prepaid guarantee trust of $351,000, and accounts payable and accrued expense of $7,547,607.

During the three months ended March 31, 2023, generated $383,281 of cash from operating activities that was primarily related to an increase in security deposits of $3,907,720 and decreased by net non-cash amount of lease expense of $1,651,670 and rents received in advance of $2,630,239, stock compensation expense of $429,996, stock option expense of $167,573, changes in accounts payable and accrued expenses of $1,024,948, accrued income taxes of $122,161, and shares used for operating expense of $884,816.

Cash Flow from Investing Activities

During the three months ended March 31, 2024, no cash used for investing activities versus cash generated of $2,442,634 during the three months ended March 31, 2023 primarily from the proceeds from the sale of Treasury Bills.

Cash Flow from Financing Activities

During the three months ended March 31, 2024, net cash provided by financing activities of $9,893,482 included warrant exercises of $4,800,000, proceeds from short term business financing of $2,618,297 and proceeds from development incentive advances of $3,000,500. During the three months ended March 31, 2023, net cash used by financing activities was $1,021,408 which was primarily made up or repayments on short term business financing of $1,255,512.

Third-Party Payment Processors

We utilize third-party payment processors to process guest transactions via credit card. Over 85% of our reservations are processed through credit card transactions in which we pay a processing fee. As noted in our financial statements, we maintain cash under “Processor retained funds” on our balance sheet as of March 31, 2024. These reserved funds are cash reserves held back by our processors to offset chargebacks and refunds due to guests. These reserves are intended to provide protection for both our guests and credit card processor with respect to cancellations and refunds. As part of our growth strategy, the large majority of our accommodation units are now rented on a nonrefundable basis, in order to minimize cancellation and refund exposures.

Advisory Shares

For the three months ended March 31, 2024

Schedule of equity transactions

Description	General Ledger Account	Date	Shares		Price		Value
Non-employee loan payment	Loan payable	1/25/2024		20,008	$	4.57	$	91,437
Non-employee commission expense	Commission Expense	1/25/2024		10,079	$	4.57	$	46,061
Non-employee investor relations expense	Investor Relations Expense	1/30/2024		59,784	$	4.33	$	258,865
Non-employee director compensation	Non-Cash Issuance of Common Stock for Director Compensation Expenses	2/8/2024		197,800	$	2.92	$	577,576
Employee Compensation	Non-Cash Issuance of Common Stock for Compensation Expenses	3/15/2024		25,000	$	2.22	$	55,500
Subtotal				312,671			$	1,029,439

For the three months ended March 31, 2023

Description	General Ledger Account	Date	Shares		Price		Value
Non-employee Board members pursuant to related comp. policy	Non-Cash Stock Compensation Expense	3/1/2023		166,665	$	2.58	$	429,996
In connection with certain property finders’ fee arrangements	Non-Cash Issuance of Common Stock for Operating Expenses	3/17/2023		136,887	$	2.45	$	335,373
In connection with a consulting agreement	Non-Cash Issuance of Common Stock for Operating Expenses	2/10/2023		196,994	$	1.85	$	364,439
In connection with a marketing agreement	Non-Cash Issuance of Common Stock for Operating Expenses	2/10/2023		100,000	$	1.85	$	185,000
Subtotal				433,881			$	884,812

Revenue Shares

On September 11, 2023, the Company issued 36,179 shares of the Company’s common stock and 578,071 shares of the Company’s common stock to Greenle Beta and Greenle Alpha, respectively, in connection with the February 2023 Revenue Share Agreement. As of November 8, 2023, the registrant had 36,836,190 shares of common stock outstanding. Shares outstanding inclusive of shares committed to be issued but not yet issued as of this date on both the February 2023 Revenue Share Agreement and the May 2023 Revenue Share Exchange Agreement are 44,804,690 (or 1,228,500 for the February 2023 Revenue Share Agreement and 6,740,000 for the May 2023 Revenue Share Agreement).

Off-Balance Sheet Arrangements

We do not currently have any off-balance sheet arrangements.

Material Cash Requirements

There have been no material changes to the information in our material cash requirements related to commitments or contractual obligations from those reported in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, as filed with the SEC on April 15, 2024.

Critical Accounting Policies and Estimates

This discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States, or GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported expenses incurred during the reporting periods. Our estimates are based on our historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. While our significant accounting policies are described in more detail in the notes to our financial statements included elsewhere in this Annual Report, we believe that the following accounting policies are critical to understanding our historical and future performance, as these policies relate to the more significant areas involving management’s judgments and estimates.

Revenue Recognition

Our revenue is derived primarily from the rental of units to our guests. We recognize revenue when obligations under the terms of a contract are satisfied and control over the promised services is transferred to the guest. For the majority of sales, this occurs when the guest occupies the unit for the agreed upon length of time and receives any services that may be included with their stay. Revenue is measured as the amount of consideration we expect to receive in exchange for the promised goods and services.

Current and future reservations for most of our accommodation units require prepayment upfront. A majority of our reservations require full prepayment at the time the reservation is placed, with the remaining charged at check-in. Payments are processed through third-party credit card processors and marketing and reservation channels. We typically offer both a refundable and nonrefundable rates on each accommodation unit, with more than 50% of bookings, on average, choosing the nonrefundable rate. As we are required to only reserve a small or no portion of prepayments under our third-party processor agreements, nonrefundable booking prepayments provide us with operating cash flow. Any advanced reservation, irrespective of when charged, is taken as revenue in the period in which the stay happens, if in a future period is reflected in deferred revenue, and if cancelled is not ultimately realized as revenue.

Refunds are treated as a reduction of our net revenue and are taken in the period during which the cancelation or refund occurred. We have multiple refund policies in place across different sales channels, which vary by price. Some require a deposit at the time of booking, which would be forfeited in part or whole in the event of cancelation through varying periods of time prior to check-in. Some of our policies require full prepayment at time of booking (but allow for a full refund if booking is cancelled within required parameters). Some of our bookings are on nonrefundable basis, in which cancellations results in forfeiture of entire amount. In connection with some of our bookings, the third-party sales channel handles payments, cancelations, and the refunds to guests.

With respect to bookings for our accommodation units made through third-party booking platforms, in the event a refund is required to be made to a customer, under the terms of our agreements with such third-party platforms, we are required to make the refund to the customer (to the extent we have received the proceeds through the platform). If we fail to make any required refund, the customer’s recourse is against the third-party booking platform, and in turn, we are required to reimburse the booking platform. Within this structure, the (a) customer is protected, and (b) the booking party bears the credit risk with respect to the customer.

We account for revenue in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606 which was adopted at the beginning of fiscal year 2018 using the modified retrospective method. We did not recognize any cumulative-effect adjustment to retained earnings upon adoption as the effect was immaterial.

Payment received for the future use of a rental unit is recognized as a liability and reported as bookings received in advance on the balance sheets. Bookings received in advance are recognized as revenue after the rental unit is occupied by the customer for the agreed upon length of time. The bookings received in advance balance as of March 31, 2024 and December 31, 2023, was $6,576,403 and $4,404,216, respectively, and is expected to be recognized as revenue within a one-year period.

Use of Estimates

The preparation of financial statements in accordance with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements. Actual results could differ from those estimates.

Cash and Cash Equivalents

We consider all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.

Fair Value of Financial Instruments

The carrying amount of cash, prepaid expenses and other assets, accounts payable and accrued expenses, and bookings received in advance approximate their fair values as of the respective balance sheet dates because of their short-term natures.

Advertising

Advertising and marketing costs are expensed as incurred and are included in General and Administrative Expenses in the accompanying consolidated statements of operations.

Commissions

We pay commissions to third-party sales channels to handle the marketing, reservations, collections, and other rental processes for most of our units and are included in cost of sales on the consolidated statement of operations.

Lease

The Company accounts for leases in accordance with ASC Topic 842, Leases (“Topic 842”). Under Topic 842, the Company applied a dual approach to all leases whereby the Company is a “lessee” and classifies leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the Company. Lease classification is evaluated at the inception of the lease agreement. Regardless of classification, the Company records a right-of-use asset and a lease liability for all leases with a term greater than 12 months. Operating lease expense is recognized on a straight-line basis over the term of the lease.

Income Taxes

In accordance with GAAP, we follow the guidance in FASB ASC Topic 740, Accounting for Uncertainty in Income Taxes, which clarifies the accounting for uncertainty in income taxes recognized in our financial statements and prescribe a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. It also provides guidance on derecognition and measurement of a tax position taken or expected to be taken in a tax return.

We did not have unrecognized tax benefits as of December 31, 2021 and do not expect this to change significantly over the next 12 months. We will recognize interest and penalties accrued on any unrecognized tax benefits as a component of provision for income taxes.

In January 2022, our company converted into a C corporation. As we have realized a net loss for the year ended December 31, 2023 and December 31, 2022 and the three months ended March 31, 2024, and as such we have not made a provision for income taxes in our financial statements for these periods.

Sales Tax

The majority of sales tax is collected from customers by our third-party sales channels and remitted to governmental authorities by these third-party sales channels. For any sales tax that is our responsibility to remit, we record the amounts collected as a current liability and relieves such liability upon remittance to the taxing authority.

Paycheck Protection Program Loan (“PPP”)

As disclosed in the Notes to our financial statements, we have chosen to account for the loan under FASB ASC 470, Debt. Repayment amounts due within one year are recorded as current liabilities, and the remaining amounts due in more than one year, if any, as long-term liabilities. In accordance with ASC 835, Interest, no imputed interest is recorded as the below market interest rate applied to this loan is governmentally prescribed. If we are successful in receiving forgiveness for those portions of the loan used for qualifying expenses, those amounts will be recorded as a gain upon extinguishment as noted in ASC 405, Liabilities.

Income Taxes

We are subject to income taxes in the jurisdictions in which we operate. We account for income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized based on the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and attributable to operating loss and tax credit carry-forwards. A valuation allowance is recorded for deferred tax assets if it is more likely than not that the deferred tax assets will not be realized.

Stock-Based Compensation

Stock-based compensation expense attributable to equity awards granted to employees will be measured at the grant date based on the fair value of the award.

The expense is recognized on a straight-line basis over the requisite service period for awards that vest, which is generally the period from the grant date to the end of the vesting period.

With regard to the issuance of warrants of common stock, these items are measured at the grant date based on the fair value of the award. The expense is recognized on the date of the grant as there is no vesting period.

We estimate the fair value of stock option awards granted and warrants using the Black-Scholes-Merton option pricing model. The value of stock issued is based on the market value on the date of the issuance.

This Black-Scholes-Merton model requires various significant judgmental assumptions in order to derive a fair value determination for each type of award, including the fair value of our common stock, the expected term, expected volatility, expected dividend yield, and risk-free interest rate.

These assumptions used in the Black-Scholes-Merton option-pricing model are as follows:

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Expected term. We estimate the expected term based on the simplified method, which defines the expected term as the average of the contractual term and the vesting period.

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Risk-free interest rate. The risk-free interest rate is based on the yield curve of a zero-coupon U.S. Treasury bond on the date the stock option award was granted with a maturity equal to the expected term of the stock option award.

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Expected volatility. We estimate the volatility of its common stock on the date of grant based on the average historical stock price volatility of comparable publicly-traded companies due to the lack of sufficient historical data for our common stock price.

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Expected dividend yield. Expected dividend yield is zero, as we have not paid and do not anticipate paying dividends on its common stock.

All grants of stock options will have an exercise price equal to or greater than the fair value of our common stock on the date of grant. We will account for forfeitures as they occur.

Accounting Pronouncements

In June of 2016, the FASB issued ASU 2016-12 “Financial Instruments-Credit Losses” (Topic 326). ASU 2016-13 requires the use of an impairment methodology that reflects an estimate of expected credit losses, measured over the contractual life of an instrument, based on information about past events, current conditions, and forecasts of future economic conditions. We adopted ASU 2016-13 on January 1, 2023 using the modified retrospective approach.

Management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if adopted, would have a material effect on the accompanying financial statements.

Item 3 - Quantitative and Qualitative Disclosures About Market Risk

We are a smaller reporting company as defined in Rule 12b-2 under the Securities Exchange Act of 1934. As a result, pursuant to Item 305(e) of Regulation S-K, we are not required to provide the information required by this Item.

Item 4 - Controls and Procedures

Management’s Evaluation of our Disclosure Controls and Procedures

Our management, with the participation of our principal executive officer and our principal financial officer, has evaluated the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, prior to filing this Annual Report on Form 10-K. Based on this evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered by this Annual Report, our disclosure controls and procedures were not effective at the reasonable assurance level.

As a public company, we are required to maintain internal control over financial reporting and to report any material weaknesses in those internal controls. With respect to the year ended December 31, 2023, we identified material weaknesses in our internal controls over financial reporting with respect to our periodic and annual financial close processes. As historically constituted, our human resources, processes and systems did not enable us to produce accurate financial statements on a timely basis.

While we deem this type of material weakness typical in a closely held, private company, in preparation of becoming a public company, we commenced a remediation plan which included the hiring of additional, qualified financial and accounting personnel, and engagement of specialized external resources, including the outsourcing of a portion of our accounting department functions to a qualified accounting firm. We also formed an audit committee of independent directors. As part of our remediation plan, we also implemented entity-level controls, and continue to do so. Our auditors have identified need to further and properly segregate duties among appropriate personnel, education and training of applicable management and financial personnel, and improvements in the process and system used to monitor and track the effectiveness of underlying business process controls. Full implementation of this plan will require additional time and the devotion of material resources.

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in “Internal Control - Integrated Framework (2013)” issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, our management concluded that our internal control over financial reporting was ineffective as of December 31, 2023 as a result of the material weakness described above.

This Annual Report does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of our independent registered public accounting firm due to a transition period established by rules of the SEC for newly public companies.

Changes in Internal Control Over Financial Reporting

We continue to execute on our plan to remedy the material weakness, as described above, including (i) initiating a full internal review and evaluation of key processes, procedures and documentation and related control procedures, and the subsequent testing of those controls and (ii) implementing policies and procedures focusing on enhancing the review and approval of all relevant data to support our assumptions and judgments in non-routine and complex transactions appropriately and timely and documenting such review and approval. We will continue this process of remediation during 2024. We have also made organizational changes and trained our employees in order to strengthen and improve our internal controls over financial reporting.

Management believes that these measures will remediate the identified material weakness. While we have completed our initial testing of these new controls and have concluded they are in place and operating as designed, we are monitoring their ongoing effectiveness, and will consider the material weakness remediated after the applicable remedial controls operate effectively for an additional period of time.

Except as otherwise stated above, there was no change in our internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Part II - Other Information

Item 1 - Legal Proceedings

In the course of our operations, we become party to litigations, disputes, and regulatory compliance issues from time to time. We are currently, and expect to be in the future, party to various actions that require us to spend time and resources that could otherwise be applied to the management of our operations. However, we are not currently party to any litigations, disputes or regulatory actions that management believes would be materially adverse, individually or in the aggregate, to the operations or financial condition of our company if such actions were to be adjudicated or settled in a manner adverse to us.

Current litigations to which we are party include those that stem from our legacy apartment rental business, in which we are no longer engaged. As disclosed in our prior Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K, our company wound down the commercial operation of approximately 1,000 residential apartments across 11 cities towards the end of 2021 and continued wind down of residential-based operations in 2022 to focus our operations exclusively on leasing entire hotel properties. This process gave rise to certain litigations, the vast majority of which has been resolved. With respect to any remaining claims relating to our legacy operations, we are either engaged in settlement discussions or have determined to defend and in some cases, counterclaim, such actions.

In connection with our wind down of these legacy operations, we voluntary initiated discussion with the City of New York with respect to any violations resulting from our legacy business under applicable City of New York short-stay rental prohibitions and related regulations. We entered into a settlement with the City of New York with respect to the foregoing in March 2024, as further described in our Annual Report on Form 10-K for the year ended December 31, 2023 under “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Regulations Governing Short-Term Rentals.”

As a public company, we could be subject from time to time to class action or other litigations brought by or on behalf of stockholders of our company. As of the date of this Quarterly Report, we are party to a class action brought in the United States District Court Southern District of New York entitled Janice Pack, Individually and on Behalf of All Others Similarly Situated, as Plaintiff, vs. LuxUrban Hotels Inc., Ferdinand and Shanoop Kothari, as Defendants, alleging, among other causes of action, securities violations in connection with our disclosure of the opening of a hotel for which a definitive lease had not then been executed and delivered. The parties to that proposed hotel opening had begun working toward a transaction in early fall 2023. We believed based on correspondence received that the material terms of the transaction had been agreed to. In addition, there was a commitment by a qualified banking institution to fund the letter of credit required under the proposed lease in a form agreeable by the landlord; however, a complete set of definitive agreements relating to the lease were not entered into by the parties. The noncompletion of this proposed lease transaction did not and will not have a material adverse effect on our operations or financial results. However, based on the complexity and multi-step process of closing long-term leases on hotel properties (and the related letter of credit and similar requirements), in 2024 and going forward, we will only announce acquisitions when they are opened for hosting guests and the entire lease execution and letter of credit process has been completed.

Our business has grown in size and complexity as we have shifted our business focus to hotel operations. Hotel operations require the implementation and management of a wide array of resources, services and processes, including employment management policies and systems, insurance coverages, booking and guest management infrastructure, property tax management and payment systems, and security and fire safety infrastructure and processes. The management of our operations involves relationships with a multitude of third parties, including unionized and nonunion labor, hotel guests, outside hotel management and services providers, booking services providers, credit card processing companies, and hotel maintenance and service companies. While the company continually refines operations, the complexity presents an environment where claims are likely to arise from time to time in the course of operations. Current litigations also include claims related to our hotel-focused operations, including claims related to building maintenance fees, lease payment obligations, brokerage fees and third-party service provider payments. With respect to any current claims relating to our hotel operations, we are either engaged in settlement discussions or have determined to defend and in some cases, counterclaim, such actions.

We currently employ approximately 509 employees across our operations and book thousands of guests annually in our properties. As of the date of this Annual Report, we have no current material litigation involving our employees or guests. However, it is possible that we could be subject to litigation brought by employees or guests from time to time in the course of our operations. Such matters could include slip in fall cases, discrimination cases, building maintenance, insurance claims, employee claims, and others.

As of March 31, 2024, we had accrued an aggregate of $7.7 million for all anticipated liabilities associated with our current litigation and regulatory actions. Management believes that the counterclaims the company has in connection with these actions could offset all or a portion of such anticipated liabilities, although there can be no assurance than any counterclaims will be successful. Assuming the most adverse outcomes, we expect aggregate liabilities from current litigations to comprise less than 1% of our anticipated revenues for 2024. After giving effect to the above-noted settlement with the City of New York, we are not currently party to any regulatory or administrative proceedings.

Item 1A - Risk Factors

As of March 31, 2024, there have been no material changes in our risk factors from those set forth under the heading Part I, “Item 1A. Risk Factors” in our Annual Report for the year ended December 31, 2023. The risks described in the Annual Report are not the only risks facing the Company. Additional risks and uncertainties not currently known to the Company or that the Company currently deems to be immaterial also may materially adversely affect the Company.

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

Unregistered Sales of Equity Securities

During the three months ended March 31, 2024, we issued an aggregate of 312,671 shares on an unregistered basis comprised of 30,087 shares issued as commission on real estate lease transactions, 59,784 for services in lieu of cash payment, 197,800 issued to our independent board members under our independent director compensation policy, and 25,000 shares as part of employee compensation.

Use of Proceeds

We did not generate any cash proceeds from the sales of the above-described shares.

Exemptions from Registration

The offer, sale, and issuance of the shares of common stock described in the preceding paragraphs were deemed to be exempt from registration under the Securities Act in reliance on Section 4(a)(2) of the Securities Act or Rule 506 of Regulation D promulgated thereunder, as a transaction by an issuer not involving a public offering. The recipients of securities in each of these transactions acquired the securities for investment only and not with a view to or for sale in connection with any distribution thereof, and appropriate legends were affixed to the securities issued in these transactions. Each of the recipients of securities in these transactions was either an accredited investor within the meaning of Rule 501 of Regulation D under the Securities Act or had adequate access, through employment, business, or other relationships, to information about the Company.

Item 3 - Defaults Upon Senior Securities

None.

Item 4 - Mine Safety Disclosures

Not applicable.

Item 5 - Other Information

Management Transitions

●

Elan Blutinger, a hotel and travel technology veteran and a member of the Company’s board of directors, was named its Nonexecutive Chairman of the Board;

●

Shanoop Kothari, the Company’s Co-Chief Executive Officer and acting Chief Financial Officer, was named its sole Chief Executive Officer;

●

Andrew Schwartz, a respected financial industry veteran and credit, debt and equity financing expert, was elected as a member of the Company’s board of directors.

Amended and Restated Claw Back Policy

Sale Restriction Waiver

Termination of Partnership Agreement

Item 6 - Exhibits

Exhibit No.		Description
3.1		Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form S-1 (File No. 333-262114) filed with the SEC on January 12, 2022).
3.1.1		Certificate of Amendment to Certificate of Incorporation (incorporated by reference to Exhibit 3.1.1 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on April 15, 2022).
3.1.2		Certificate of Amendment to Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the SEC on November 2, 2022).
3.2		Bylaws (incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement on Form S-1 (File No. 333-262114) filed with the SEC on January 12, 2022).
3.3		Certificate of Conversion from LLC to “C” corporation (incorporated by reference to Exhibit 3.3 to the Company’s Registration Statement on Form S-1 (File No. 333-262114) filed with the SEC on January 12, 2022).
3.4		Certificate of Designations, Rights and Preferences for 13.00% Series A Cumulative Redeemable Preferred Stock (incorporated by reference to Exhibit 3.6 of our Form 8-A filed with the SEC on October 26, 2023).
4.1		Description of Registrant’s Securities (incorporated by the reference to Exhibit 4.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on April 15, 2024).
4.2		Specimen common stock certificate (incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on January 31, 2022).
4.3		October 2021 Warrant (incorporated by reference to Exhibit 4.2 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on April 15, 2022).
4.3.1		Addendum to the THA Contingent Warrants (incorporated by reference to Exhibit 4.2.1 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on April 15, 2022).
4.4		November 2021 Warrant (incorporated by reference to Exhibit 4.3 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on April 15, 2022).
4.4.1		Addendum to the EBOL Contingent Warrants (incorporated by reference to Exhibit 4.3.1 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on April 15, 2022).
4.5		Form of Underwriter’s Warrant (incorporated by reference to Exhibit 4.4 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on January 31, 2022).
4.6		Form of Warrant Agency Agreement (incorporated by reference to Exhibit 10.10 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on January 31, 2022).
4.7		Form of May/June 2022 Warrant (incorporated by reference to Exhibit 4.5 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on July 11, 2022).
4.8		Form of 2022 Investor Warrant (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on September 22, 2022).
4.9		Representative’s Warrant (incorporated by reference to Exhibit 4.4 to the Company’s Current Report on Form 8-K filed with the SEC on August 16, 2022).
4.10		Form of September 2022 Investor Warrant (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on September 30, 2022).
4.11		Specimen Preferred Stock Certificate representing the shares of 13.00% Series A Cumulative Redeemable Preferred Stock (incorporated by reference to Exhibit 4.1 of our Form 8-A filed with the SEC on October 26, 2023).

10.1		2022 Performance Equity Plan (incorporated by reference to Exhibit 10.1 to the Company’s Registration Statement on Form S-1 (File No. 333-262114) filed with the SEC on January 12, 2022).
10.2		Employment Agreement with Brian Ferdinand (incorporated by reference to Exhibit 10.2 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on July 22, 2022).
10.2.1		Amendment to Employment Agreement of Brian Ferdinand (incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed with the SEC on March 5, 2024).
10.3		Amended and Restated Employment Agreement with Shanoop Kothari (incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K filed with the SEC on March 5, 2024).
10.4		Employment Agreement with Robert Arigo ((incorporated by reference to Exhibit10.1 to the Company’s Current Report on Form 8-K filed with the SEC on March 5, 2024)
10.5		Amended and Restated Employment Agreement with Jimmie Chatmon ((incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the SEC on March 5, 2024)
10.6		Employment Agreement with Brandon Elster ((incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed with the SEC on March 5, 2024)
10.7		Employment Agreement with Karl Rothman (incorporated by reference to Exhibit 10.6 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on July 22, 2022).
10.8		Form of Directors and Officers Indemnification Agreement (incorporated by reference to Exhibit 10.10 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on January 31, 2022).
10.9		Securities Purchase Agreement, dated May 27, 2022 (incorporated by reference to Exhibit 10.13 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on July 11, 2022).
10.10		Amendment No. 1, dated June 30, 2022, to Securities Purchase Agreement, dated May 27, 2022 (incorporated by reference to Exhibit 10.14 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on July 11, 2022).
10.11		Securities Purchase Agreement, dated June 30, 2022 (incorporated by reference to Exhibit 10.15 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on July 11, 2022).
10.12		Form of May/June 2022 Note (incorporated by reference to Exhibit 10.16 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on July 11, 2022).
10.13		Form of Security and Guaranty Agreement Related to the May/June 2022 Notes (incorporated by reference to Exhibit 10.17 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on July 11, 2022).
10.14		Amended and Restated Registration Rights Agreement (incorporated by reference to Exhibit 10.18 to the Company’s Registration Statement on Form S-1/A (File No. 333-262114) filed with the SEC on July 11, 2022).
10.15		Form of September 2022 Investor Note (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on September 30, 2022).
10.16		Form of September 2022 Investor Purchase Agreement (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the SEC on September 30, 2022).
10.17		Amended and Restated Security and Guaranty Agreement (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed with the SEC on September 30, 2022).
10.18		Amended and Restated Registration Rights Agreement (incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed with the SEC on September 30, 2022).
10.19		Addendum to September 2022 Investor Purchase Agreement (incorporated by reference to Exhibit 10.5 of the Company’s Current Report on Form 8-K/A filed with the SEC on October 20, 2022).
10.20		Form of Hotel Management Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on November 8, 2022).

10.21		Form of November 2022 Investor Note (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on November 28, 2022).^†
10.22		Loan Agreement (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the SEC on November 28, 2022).^†
10.23		Revenue Share Agreement (incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed with the SEC on November 28, 2022).^†
10.24		Transition Services Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on December 2, 2022).
10.25		Note Extension and Conversion Agreement, dated December 20, 2022 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on December 20, 2022).
10.26		Restricted Stock Award Agreement (Shanoop Kothari) (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the SEC on December 20, 2022).
10.27		Revenue Share Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 14, 2023).^†
10.28		February 2023 Letter Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on February 21, 2023).
10.29		Amendment No. 1 to the Amended and Restated Security and Guaranty Agreement (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed with the SEC on February 21, 2023).
10.30		Revenue Share Exchange Agreement dated May 21, 2023 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on May 23, 2023).
10.31		June 2023 Letter Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on June 20, 2023).
10.32		Registration Rights Amendment and Warrant Letter Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on September 1, 2023).
10.33		November 2023 Letter Agreement (incorporated by reference to Exhibit 10.6 to the Company’s Quarterly Report for the Nine Months Ended September 30, 2023 filed with the SEC on November 8, 2023).
10.34		December 2023 Letter Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on December 18, 2023).
10.35		Second December 2023 Letter Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on December 29, 2023).
10.36		April 2024 Letter Agreement (incorporated by reference to Exhibit 10.36 to the Company’s Annual Report on Form 10-K filed with the SEC on April 15, 2024).
10.36.1		May 2024 Modification to April 2024 Letter Agreement (incorporated by reference to Exhibit 10.36.1 to the Company’s Quarterly Report on Form 10-Q filed with the SEC on May 13, 2024).
21.1		List of Subsidiaries of the Registrant (incorporated by reference to Exhibit 10.36 to the Company’s Annual Report on Form 10-K filed with the SEC on April 15, 2024).
31.1		Certificate of Principal Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.⁽¹⁾
31.2		Certificate of Principal Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.⁽¹⁾
32.1		Certificate of Principal Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.⁽¹⁾
32.2		Certificate of Principal Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.⁽¹⁾

Exhibit 101.INS		Inline XBRL Instance Document
Exhibit 101.SCH		Inline XBRL Taxonomy Extension Schema Document
Exhibit 101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
Exhibit 101.DEF		Inline XBRL Taxonomy Definition Linkbase Document
Exhibit 101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
Exhibit 101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
Exhibit 104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

	(1)	Filed herewith.
	†	Certain of the exhibits and schedules to this agreement have been omitted in accordance with Regulation S-K Item 601(a)(5). The Company agrees to furnish a copy of all omitted exhibits and schedules to the SEC upon request.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	LUXURBAN HOTELS INC.

Dated: August 20, 2024	By:	/s/ Robert Arigo
		Robert Arigo
		Chief Executive Officer

Exhibit 31.1

CERTIFICATION BY PRINCIPAL EXECUTIVE OFFICER

I, Robert Arigo., certify that:

1 I have reviewed this Quarterly Report on Form 10-Q/A of LuxUrban Hotels Inc. and Subsidiaries;

2 Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3 Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4 The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5 The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

August 20, 2024

	/s/ Robert Arigo
	Chief Executive Officer
	(Principal Executive Officer)

Exhibit 31.2

CERTIFICATION BY PRINCIPAL FINANCIAL OFFICER

I, Michael James, certify that:

1 I have reviewed this Quarterly Report on Form 10-Q/A of LuxUrban Hotels Inc. and Subsidiaries;

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

August 20, 2024

	/s/ Michael James
	Chief Financial Officer
	(Principal Financial Officer)

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q/A of LuxUrban Hotels Inc. and Subsidiaries (the “Company”) for the quarter ended March 31, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, Robert Arigo, Chief Executive Officerof the Company, hereby certifies, pursuant to 18 U.S.C. Section 1350, that to his knowledge:

(1)	the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)	the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

August 20, 2024

	/s/ Robert Arigo
	Chief Executive Officer
	(Principal Executive Officer)

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q/A of LuxUrban Hotels Inc. and Subsidiaries (the “Company”) for the quarter ended March 31, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, Michael James, Chief Financial Officer of the Company, hereby certifies, pursuant to 18 U.S.C. Section 1350, that to his knowledge:

(1)	the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)	the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

August 20, 2024

	/s/ Michael James
	Chief Financial Officer
	(Principal Financial Officer)

Cover - shares	3 Months Ended
Cover - shares	Mar. 31, 2024	Aug. 20, 2024
Document Type	10-Q/A
Amendment Flag	true
Amendment Description	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.
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Mar. 31, 2024
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2024
Current Fiscal Year End Date	--12-31
Entity File Number	001-41473
Entity Registrant Name	LUXURBAN HOTELS INC.
Entity Central Index Key	0001893311
Entity Tax Identification Number	82-3334945
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	2125 Biscayne Blvd
Entity Address, Address Line Two	Suite 253
Entity Address, City or Town	Miami
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33137
City Area Code	(833)
Local Phone Number	723-7368
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		123,400,956
Common stock, $0.00001 par value per share
Title of 12(b) Security	Common stock, $0.00001 par value per share
Trading Symbol	LUXH
Security Exchange Name	NASDAQ
13.00% Series A Cumulative Redeemable Preferred Stock, $0.00001 par value per share
Title of 12(b) Security	13.00% Series A Cumulative Redeemable Preferred Stock, $0.00001 par value per share
Trading Symbol	LUXHP
Security Exchange Name	NASDAQ

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
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
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
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

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares	Mar. 31, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Preferred stock per shares	$ 25	$ 25
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	294,144	294,144
Preferred stock, shares outstanding	294,144	294,144
Common stock, shares authorized	41,839,361	39,462,440
Common stock, shares issued	41,839,361	39,462,440
Common stock, shares outstanding	41,839,361	39,462,440

CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Income Statement [Abstract]
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	(0)	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 Weighted Average Number of Common Shares Outstanding	49,223,606	28,659,358
Diluted Weighted Average Number of Common Shares Outstanding	49,223,606	28,659,358

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIT (UNAUDTIED) - USD ($)	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Balance - December 31, 2022 at Dec. 31, 2022	$ 276	$ 17,726,592	$ (21,018,992)	$ (3,292,124)
Beginning balance, shares at Dec. 31, 2022	27,691,918
Net Loss			(2,780,534)	(2,780,534)
Non-Cash Stock Compensation Expense	$ 2	429,994		429,996
Non-Cash Stock Compensation Expense, shares	166,665
Non-Cash Stock Option Expense		167,573		167,573
Issuance of Shares for Operating Expenses	$ 4	884,812		884,816
Issuance of Shares for Operating Expenses, shares	433,881
Conversion of Loans	$ 9	2,699,991		2,700,000
Conversion of Loans, shares	900,000
Modification of Warrants
Warrant Exercise	$ 2	399,998		400,000
Warrant Exercise, shares	200,000
Preferred Dividends
Loss on Debt Extinguishment		58,579		58,579
Balance - March 31, 2023 at Mar. 31, 2023	$ 293	22,367,539	(23,799,526)	(1,431,694)
Ending balance, shares at Mar. 31, 2023	29,392,464
Balance - December 31, 2022 at Dec. 31, 2023	$ 394	90,437,155	(99,710,503)	(9,272,954)
Beginning balance, shares at Dec. 31, 2023	39,462,440
Net Loss			(42,159,482)	(42,159,482)
Non-Cash Stock Compensation Expense	$ 2	633,074		633,076
Non-Cash Stock Compensation Expense, shares	222,800
Non-Cash Option Compensation Expense		152,339		152,339
Issuance of Shares for Operating Expenses	$ 1	304,925		304,926
Issuance of Shares for Operating Expenses, shares	69,863
Modification of Warrants		2,036,200		2,036,200
Warrant Exercise	$ 15	4,799,985		4,800,000
Warrant Exercise, shares	1,450,000
Issuance of Shares to Satisfy Loans		91,435		91,435
Issuance of Shares to Satisfy Loans, shares	20,008
Issuance of Shares for Revenue Share Agreements	$ (6)	6
Issuance of Shares for Revenue Share Agreements, shares	614,250
Preferred Dividends			(238,992)	(238,992)
Balance - March 31, 2023 at Mar. 31, 2024	$ 418	$ 98,455,107	$ (142,108,977)	$ (43,653,452)
Ending balance, shares at Mar. 31, 2024	41,839,361

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 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
(Increase) Decrease in:
Accounts Receivable, Net	(156,180)
Processor retained funds		(218,023)
Receivables from On-Line Travel Agencies, Net	2,711,468
Receivables from City of New York and Landlords, Net	1,768,975
Prepaid expense and other assets	(4,073,427)	261,157
Prepaid Guarantee Trust - Related Party	351,000
Security deposits	(1,050,000)	(3,907,720)
(Decrease) Increase in:
Accounts payable and accrued expenses	7,547,607	1,024,948
Operating lease liabilities	(8,050,548)	(4,804,716)
Rents received in advance	10,222,435	2,630,239
Accrued Income Taxes		122,161
Net cash (used in) provided by operating activities	(9,456,285)	383,281
Cash Flows from Investing Activities
Purchase of Furniture and Equipment		(249,762)
Proceeds from the sale of Treasury Bills		2,692,396
Net cash provided by investing activities		2,442,634
Cash Flows from Financing Activities
Proceeds from (Repayments of) short term business financing - net	2,331,721	(1,255,512)
Warrant Exercises	4,800,000	400,000
Proceeds from Development Incentive Advances	3,000,500
Proceeds from (Repayments of) loans payable - net	67	(165,896)
Repayments of financed initial direct costs	(194,955)
Preferred shareholder dividends paid	(238,992)
Net cash provided by (used in) financing activities	9,698,341	(1,021,408)
Net Increase in Cash and Cash Equivalents and Restricted Cash	242,056	1,804,507
Cash and Cash Equivalents and Restricted Cash - beginning of the period	752,848	2,176,402
Cash and Cash Equivalents and Restricted Cash - end of the period	994,904	3,980,909
Cash and Cash Equivalents	994,904	2,880,909
Restricted Cash		1,100,000
Total Cash and Cash Equivalents and Restricted Cash	994,904	3,980,909
Supplemental Disclosures of Cash Flow Information
Taxes
Interest	1,598,784	2,130,605
Noncash operating activities:
Acquisition of New Operating Lease Right-of-Use Assets		88,267,775
Noncash financing activities:
Financed Initial Direct Costs for leases paid with common stock	91,435
Conversion of debt to common stock and additional paid-in capital		$ 2,700,000

DESCRIPTION OF BUSINESS AND PRINCIPLES OF CONSOLIDATION

3 Months Ended

Mar. 31, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

DESCRIPTION OF BUSINESS AND PRINCIPLES OF CONSOLIDATION

1 - DESCRIPTION OF BUSINESS AND PRINCIPLES OF CONSOLIDATION

All significant intercompany accounts and transactions have been eliminated in consolidation.

RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

3 Months Ended

Mar. 31, 2024

Restatement Of Previously Issued Financial Statements

RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

2 - RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS

Restatement Items

The following tables present the effect of the Restatement Items on the Company’s condensed consolidated balance sheet for the period indicated:

Condensed balance sheet
	As of March 31, 2024 (unaudited)
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
ASSETS
Current Assets
Cash and Cash Equivalents	$	994,904		$	-		$	994,904
Accounts Receivable, Net		486,067			-			486,067
Channel Retained Funds, Net		1,500,000			(1,500,000	)		-		a
Processor Retained Funds, Net		2,633,926			(2,633,926	)		-		b
Receivables from On-Line Travel Agencies, Net		6,749,769			(6,749,769	)		-		b
					(984,744	)				b
Receivables from City of New York and Landlords, Net		6,018,035			(3,201,640	)		1,831,651		c
Prepaid Expenses and Other Current Assets		1,361,114			(342,212	)		1,018,902		d
Prepaid Guarantee Trust - Related Party		672,750			-			672,750
Total Current Assets		20,416,565			(15,412,291	)		5,004,274
Other Assets
Furniture, Equipment and Leasehold Improvements, Net		677,559			-			677,559
Security Deposits - Noncurrent		20,607,413			-			20,607,413
Prepaid Expenses and Other Noncurrent Assets		5,974,276			-			5,974,276
Operating Lease Right-Of-Use Assets, Net		229,016,100			-			229,016,100
Total Other Assets		256,275,348			-			256,275,348
Total Assets	$	276,691,913		$	(15,412,291	)	$	261,279,622

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
				$	3,738,225					b
Accounts Payable and Accrued Expenses	$	28,868,844			(1,827,157	)	$	30,779,912		c
Bookings Received in Advance		6,576,403			8,050,248			14,626,651		e
Short Term Business Financing, Net		3,733,417			-			3,733,417
Loans Payable - Current		1,666,108			-			1,666,108
Initial Direct Costs Leases - Current		300,000			-			300,000
Operating Lease Liabilies - Current		1,944,026			-			1,944,026
Development Incentive Advances - Current		8,893,987			-			8,893,987
Total Current Liabilities		51,982,785			9,961,316			61,944,101
Long-Term Liabilities
Loans Payable		1,447,720			-			1,447,720
Development Incentive Advances - Noncurrent		-			-			-
Initial Direct Costs Leases - Noncurrent		3,950,000			-			3,950,000
Operating Lease Liabilities - Noncurrent		231,815,657			-			231,815,657
Total Long-Term Liabilities		237,213,377			-			237,213,377
Total Liabilities		289,196,162			9,961,316			299,157,478
Mezzanine equity
13% Redeemable Preferred Stock; Liquidation Perference $25 per Share; 10,000,000 Shares Authorized; 294,144 shares issued and outstanding as of March 31, 2024		5,775,596			-			5,775,596
Commitments and Contingencies
Stockholders’ Deficit
Common Stock (90,000,000 shares authorized, issued, outstanding - 41,839,361)		418			-			418
Additional Paid In Capital		98,455,107			-			98,455,107
Accumulated Deficit		(116,735,370	)		(25,373,607	)		(142,108,977	)	a, b, c, d, e
Total Stockholders’ Deficit		(18,279,845	)		(25,373,607	)		(43,653,452	)
Total Liabilities and Stockholders’ Deficit	$	276,691,913		$	(15,412,291	)	$	261,279,622

See accompanying notes to condensed consolidated financial statements.

The following tables present the effect of the Restatement Items on the Company’s condensed consolidated statement of operations for the period indicated:

Condensed income statement
	As of March 31, 2024 (unaudited)
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
Net Rental Revenue	$	29,101,207		$	(15,143,846	)	$	13,957,361		b, c, e
Rent Expense		8,344,007			-			8,344,007
Non-Cash Rent Expense Amortization		2,093,667			-			2,093,667
Surrender of Deposits		750,000			-			750,000
Other Expenses		22,508,411			1,842,212			24,350,623		a, d
Total Cost of Revenue		33,696,085			1,842,212			35,538,297
Gross (Loss) Profit		(4,594,878	)		(16,986,058	)		(21,580,936	)
General and Administrative Expenses		3,755,756			8,387,549			12,143,305		b
Non-Cash Issuance of Common Stock for Operating Expenses		304,925			-			304,925
Non-Cash Stock Compensation Expense		724,514			-			724,514
Non-Cash Stock Option Expense		152,339			-			152,339
Partnership Considerations		2,679,469			-			2,679,469
Total Operating Expenses		7,617,003			8,387,549			16,004,552
(Loss) Income from Operations		(12,211,881	)		(25,373,607	)		(37,585,488	)
Other Income (Expense)
Other Income		210,076			-			210,076
Cash Interest and Financing Costs		(2,459,800	)		-			(2,459,800	)
Non-Cash Financing Costs		(2,324,270	)		-			(2,324,270	)
Total Other Expense		(4,573,994	)		-			(4,573,994	)
Loss Before Provision for Income Taxes		(16,785,875	)		(25,373,607	)		(42,159,482	)
Provision for Income Taxes		-			-			-
Net Loss		(16,785,875	)		(25,373,607	)		(42,159,482	)
Preferred Stock Dividend		(238,992	)		-			(238,992	)
Net Loss Attributable to Common Stockholders	$	(17,024,867	)	$	(25,373,607	)	$	(42,398,474	)
Basic Loss Per Common Share	$	(0.35	)	$	(0.52	)	$	(0.87	)
Diluted Loss Per Common Share	$	(0.35	)	$	(0.52	)	$	(0.87	)
Basic and Diluted Weighted Average Number of Common Shares Outstanding		49,223,606			49,223,606			49,223,606

See accompanying notes to condensed consolidated financial statements.

The following tables present the effect of the Restatement Items on the Company’s condensed consolidated statement of changes in stockholders’ deficit for the period indicated:

Stockholders' equity
	Common Stock				Additional Paid in			Accumulated			Stockholders’			Restatement
	Shares		Value		Capital			Deficit			(Deficit)			References
Balance - December 31, 2023		39,462,440	$	394	$	90,437,155		$	(99,710,503	)	$	(9,272,954	)
Net Loss		-		-		-			(16,785,875	)		(16,785,875	)
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
Agreement		614,250		6		(6	)		-			-
Preferred Dividends		-		-		-			(238,992	)		(238,992	)
Restatement Items									(25,373,607	)		(25,373,607	)	a, b, c, d, e
Balance - March 31, 2024		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 Option Compensation 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
Restatement Items		-		-		-			-			-
Balance - March 31, 2023		29,392,464	$	293	$	22,367,539		$	(23,799,526	)	$	(1,431,694	)

See accompanying notes to condensed consolidated financial statements.

The following tables present the effect of the Restatement Items on the Company’s condensed consolidated statement of cash flows for the period indicated:

Condensed Cash Flow Statement
	As of March 31, 2024 (unaudited)
	As Previously			Restatement			As			Restatement
	Reported			Adjustments			Restated			References
Cash Flows from Operating Activities
Net (Loss)	$	(16,785,875	)	$	(25,373,607	)	$	(42,159,482	)	a, b, c, d, e
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Writeoff of bad debts					7,843,456			7,843,456		b
Writeoff of channel retained funds security deposit					1,500,000			1,500,000		a
Writeoff of security deposits		750,000			-			750,000
Writeoff of vendor overpayment		50,000			-			50,000
Non-cash stock compensation expense		55,500			-			55,500
Non-cash stock director expense		577,576			-			577,576
Non-cash stock option expense		152,339			-			152,339
Depreciation expense		13,676			-			13,676
Shares issued for operating expenses		304,926			-			304,926
Modification of Warrants		2,036,200			-			2,036,200
Non-cash lease expense		10,146,639			-			10,146,639
Gain on lease exit		(209,811	)		-			(209,811	)
Non-cash foregiveness of Development Incentive Advances		(75,210	)		-			(75,210	)
Gain on sale of Treasury Bills		-			-			-
Non-cash Financing Charges Associated with Short Term Business Financing		286,576			-			286,576
Loss on Debt Extinguishment		-			-			-
Changes in operating assets and liabilities:
(Increase) Decrease in:
Accounts Receivable, Net		(156,180	)		-			(156,180	)
Receivables from On-Line Travel Agencies, Net		186,485			2,524,983			2,711,468		b
Receivables from City of New York and Landlords, Net		(1,432,665	)		3,201,640			1,768,975		c
Prepaid expense and other assets		(4,415,639	)		342,212			(4,073,427	)	d
Prepaid Guarantee Trust - Related Party		351,000			-			351,000
Security deposits		(1,050,000	)		-			(1,050,000	)
(Decrease) Increase in:								-
Accounts payable and accrued expenses		5,636,539			1,911,068			7,547,607		b, c
Operating lease liabilities		(8,050,548	)		-			(8,050,548	)
Rents received in advance		2,172,187			8,050,248			10,222,435		e
Accrued Income Taxes		-			-			-
Net cash provided by operating activities		(9,456,285	)		-			(9,456,285	)

Cash Flows from Investing Activities
Purchase of Furniture and Equipment		-			-			-
Proceeds from the sale of Treasury Bills		-			-			-
Net cash provided by investing activities		-			-			-

Cash Flows from Financing Activities
Deferred offering costs - net
Proceeds from (Repayments of) short term business financing - net		2,331,721			-			2,331,721
Warrant Exercises		4,800,000			-			4,800,000
Proceeds from Development Incentive Advances		3,000,500			-			3,000,500
Proceds from (Repayments of) loans payable - net		67			-			67
Repayments of loans payable - net		(194,955	)		-			(194,955	)
Preferred shareholder dividends paid		(238,992	)		-			(238,992	)
Net cash used in financing activities		9,698,341			-			9,698,341

Net Increase in Cash and Cash Equivalents and Restricted Cash		242,056			-			242,056
Cash and Cash Equivalents and Restricted Cash - beginning of the period		752,848			-			752,848
Cash and Cash Equivalents and Restricted Cash - end of the period		994,904			-			994,904

Cash and Cash Equivalents		994,904			-			994,904
Restricted Cash		-			-			-
Total Cash and Cash Equivalents and Restricted Cash	$	994,904		$	-		$	994,904

Supplemental Disclosures of Cash Flow Information
Taxes	$	-		$	-		$	-
Interest	$	1,598,784		$	-		$	1,598,784
Noncash operating activities:
Acquisition of New Operating Lease Right-of-Use Assets	$	-		$	-		$	-
Noncash financing activities:
Financed Initial Direct Costs for leases paid with common stock	$	91,435		$	-		$	91,435
Conversion of debt to common stock and additional paid-in capital	$	-		$	-		$	-

See accompanying notes to condensed consolidated financial statements.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, AS RESTATED

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, AS RESTATED

3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, AS RESTATED

LEASES

3 Months Ended

Mar. 31, 2024

Leases

LEASES

4 - LEASES

The components of the right-of-use assets and lease liabilities as of March 31, 2024 and December 31, 2023 were as follows:

At March 31, 2024 and December 31, 2023, supplemental balance sheet information related to leases were as follows:


	March 31, 2024		December 31, 2023
Operating lease right of use assets, net	$	229,016,100	$	241,613,588
Operating lease liabilities, current portion	$	1,944,026	$	1,982,281
Operating lease liabilities, net of current portion	$	231,815,657	$	242,488,610

At March 31, 2024, future minimum lease payments under the non-cancelable operating leases are as follows:

Schedule of future minimum lease payments under the non-cancelable operating leases


Twelve Months Ending March 31,
2025	$	30,835,724
2026		31,709,210
2027		32,589,176
2028		33,826,455
2029		34,890,889
Thereafter		409,189,267
Total lease payment	$	573,040,721
Less interest		(339,281,038	)
Present value obligation		233,759,683
Short-term liability		1,944,026
Long-term liability	$	231,815,657

The following summarizes other supplemental information about the Company’s operating lease:


	March 31, 2024			March 31, 2023
Weighted average discount rate		12.15	%		10.0	%
Weighted average remaining lease term (years)		13.4 years			13.0 years

	Three Months Ended March 31, 2024		Three Months Ended March 31, 2023
Operating lease cost	$	10,146,639	$	6,456,680
Short-term lease cost	$	291,035	$	616,856
Total lease cost	$	10,437,674	$	7,073,536

ACCOUNTS RECEIVABLES, PROCESSOR AND CHANNEL RETAINED FUNDS, AS RESTATED

3 Months Ended

Mar. 31, 2024

Credit Loss [Abstract]

ACCOUNTS RECEIVABLES, PROCESSOR AND CHANNEL RETAINED FUNDS, AS RESTATED

5 - ACCOUNTS RECEIVABLES, PROCESSOR AND CHANNEL RETAINED FUNDS, AS RESTATED

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES, AS RESTATED

3 Months Ended

Mar. 31, 2024

Payables and Accruals [Abstract]

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES, AS RESTATED

6 - ACCOUNTS PAYABLE AND ACCRUED LIABILITIES, AS RESTATED

Accounts payable and accrued expenses totaled $30,779,912 and $23,182,305 as of March 31, 2024 and December 31, 2023, respectively.

Of the legal amounts accrued, the company believes the accrual best estimates the most likely outcomes of these matters however the range of outcomes could be between $5 million and $8.5 million.

LOANS PAYABLE – SBA – PPP LOAN

3 Months Ended

Mar. 31, 2024

Loans Payable Sba Ppp Loan

LOANS PAYABLE – SBA – PPP LOAN

7 - LOANS PAYABLE – SBA – PPP LOAN

Accrued interest at March 31, 2024 and December 31, 2023, was $6,318 and $5,571, respectively, and is included in accounts payable and accrued expenses in the consolidated balance sheets.

Future minimum principal repayments of the SBA - PPP loans payable are as follows:


For the Twelve Months Ending March 31,
2025	$	276,658

LOANS PAYABLE – SBA – EIDL LOAN

3 Months Ended

Mar. 31, 2024

Loans Payable Sba Eidl Loan

LOANS PAYABLE – SBA – EIDL LOAN

8 - LOANS PAYABLE – SBA – EIDL LOAN

The outstanding balance at March 31, 2024 and December 31, 2023, was $783,319 and $786,950, respectively.

Accrued interest at March 31, 2024 and December 31, 2023 was $8,966 and $27,644 and respectively included in accounts payable and accrued expenses in the consolidated balance sheets.

Future minimum principal repayments of the SBA - EIDL loans payable are as follows:

Schedule of future minimum principal repayments of the SBA,EIDL loans payable


For the Twelve Months Ending March 31,
2025	$	18,699
2026		15,536
2027		16,129
2028		16,744
2029		17,383
Thereafter		698,828
Total	$	783,319

SHORT-TERM BUSINESS FINANCING

3 Months Ended

Mar. 31, 2024

Short-term Business Financing

SHORT-TERM BUSINESS FINANCING

9 - SHORT-TERM BUSINESS FINANCING

LOANS PAYABLE

3 Months Ended

Mar. 31, 2024

Disclosure Loans Payable Abstract

LOANS PAYABLE

10 - LOANS PAYABLE

Loans payable consist of the following as of:

Schedule of loans payable
	March 31, 2024		December 31, 2023
Original payable of $151,096 with additional net borrowings of $252,954, requires monthly payments of $1,500 until total payments of $404,050 have been made		356,012		338,512
Original payable of $553,175 with additional net borrowings of $72,237, requires monthly payments of $25,000 until total payments of $625,412 have been made		400,000		400,000
Original payable of $492,180 with additional net borrowings of $620,804 requires monthly payments of $25,000 until total payments of $1,112,984 have been made		865,618		865,618
Original amounts due of $195,000, related to services provided by a vendor, requires monthly payments of $10,000 through May 2022, then monthly payments of $25,000 through August 2022 at which time any remaining balance is due		20,000		20,000
Other borrowing		342,246		356,048
Less: Current maturities		1,370,751		1,360,609
	$	613,125	$	619,569

Future minimum principal repayments of the loans payable are as follows:


For the Twelve Months Ending March 31,
2024	$	1,370,751
2025		613,125
Loans payable	$	1,983,876

LINE OF CREDIT

3 Months Ended

Mar. 31, 2024

Line Of Credit

LINE OF CREDIT

11 - LINE OF CREDIT

RELATED PARTY TRANSACTIONS

3 Months Ended

Mar. 31, 2024

RELATED PARTY TRANSACTIONS

12 - RELATED PARTY TRANSACTIONS

RISKS AND UNCERTAINTIES

3 Months Ended

Mar. 31, 2024

Risks and Uncertainties [Abstract]

RISKS AND UNCERTAINTIES

13 - RISKS AND UNCERTAINTIES

MAJOR SALES CHANNELS

3 Months Ended

Mar. 31, 2024

Major Sales Channels

MAJOR SALES CHANNELS

14 - MAJOR SALES CHANNELS

STOCK OPTIONS, RESTRICTED STOCK UNITS AND WARRANTS

3 Months Ended

Mar. 31, 2024

Equity [Abstract]

STOCK OPTIONS, RESTRICTED STOCK UNITS AND WARRANTS

15 - STOCK OPTIONS, RESTRICTED STOCK UNITS AND WARRANTS

Options

During the three months ended March 31, 2024, the Company did not grant any options to purchase shares of common stock under the Company’s 2022 performance equity plan.

The following table summarizes stock option activity for the three months ended March 31, 2024:


	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value
Outstanding at December 31, 2023		1,746,885		$	2.86		9.0	$	5,427,118
Granted		-			-
Exercised		-			-
Expired		-			-
Forfeited		(29,250	)		2.09
Outstanding at March 31, 2024		1,717,635		$	2.88		8.7	$	-
Exercisable at March 31, 2024		485,045		$	2.69		8.6	$	-

A summary of the status of the Company’s nonvested options as of March 31, 2024, is presented below:


	Number of Nonvested Options			Weighted Average Grant Date Fair Value
Nonvested options at December 31, 2023		1,257,590		$	2.93
Granted		-			-
Forfeited		-			-
Vested		(25,000	)	$	1.74
Nonvested options at March 31, 2024		1,232,590		$	2.95

Restricted Stock Units

As of March 31, 2024, there was $166,500 of unrecognized compensation cost related to unvested restricted shares.

Warrants

The following table summarizes warrant activity for the three months ended March 31, 2024:

Schedule of stock option activity
	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value
Outstanding at December 31, 2023		5,442,000		$	4.68		4.7	$	7,038,940
Granted		-			-
Exercised		(1,450,000	)		3.31
Expired		-			-
Forfeited		-			-
Outstanding at March 31, 2024		3,992,000		$	2.92		4.4	$	-
Exercisable at March 31, 2024		3,992,000		$	2.92		4.4	$	-

During the three months ended March 31, 2024, 1,450,000 shares were issued from the exercise of warrants.

Revenue Share Exchange

3 Months Ended

Mar. 31, 2024

Revenue Share Exchange

Revenue Share Exchange

16 - Revenue Share Exchange

WYNDHAM AGREEMENTS

3 Months Ended

Mar. 31, 2024

Wyndham Agreements

WYNDHAM AGREEMENTS

17 - WYNDHAM AGREEMENTS

REDEEMABLE PREFERRED STOCK

3 Months Ended

Mar. 31, 2024

Redeemable Preferred Stock

REDEEMABLE PREFERRED STOCK

18 - REDEEMABLE PREFERRED STOCK

During the three months ended March 31, 2024, the Company paid $238,992 in aggregate dividends on its outstanding Series A Preferred Stock.

EQUITY TRANSACTIONS

3 Months Ended

Mar. 31, 2024

Equity Transactions

EQUITY TRANSACTIONS

19 - EQUITY TRANSACTIONS

For the three months ended March 31, 2024

Schedule of equity transactions
Description	General Ledger Account	Date	Shares		Price		Value
Non-employee loan payment	Loan payable	1/25/2024		20,008	$	4.57	$	91,437
Non-employee commission expense	Commission Expense	1/25/2024		10,079	$	4.57	$	46,061
Non-employee investor relations expense	Investor Relations Expense	1/30/2024		59,784	$	4.33	$	258,865
Non-employee director compensation	Non-Cash Issuance of Common Stock for Director Compensation Expenses	2/8/2024		197,800	$	2.92	$	577,576
Employee Compensation	Non-Cash Issuance of Common Stock for Compensation Expenses	3/15/2024		25,000	$	2.22	$	55,500
Subtotal				312,671			$	1,029,439

For the three months ended March 31, 2023

Description	General Ledger Account	Date	Shares		Price		Value
Non-employee Board members pursuant to related comp. policy	Non-Cash Stock Compensation Expense	3/1/2023		166,665	$	2.58	$	429,996
In connection with certain property finders’ fee arrangements	Non-Cash Issuance of Common Stock for Operating Expenses	3/17/2023		136,887	$	2.45	$	335,373
In connection with a consulting agreement	Non-Cash Issuance of Common Stock for Operating Expenses	2/10/2023		196,994	$	1.85	$	364,439
In connection with a marketing agreement	Non-Cash Issuance of Common Stock for Operating Expenses	2/10/2023		100,000	$	1.85	$	185,000
Subtotal				600,546			$	1,314,808

SUBSEQUENT EVENTS

3 Months Ended

Mar. 31, 2024

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

20 - SUBSEQUENT EVENTS

Management Transitions

●

Elan Blutinger, a hotel and travel technology veteran and a member of the Company’s board of directors, was named its Nonexecutive Chairman of the Board;

●

Shanoop Kothari, the Company’s Co-Chief Executive Officer and acting Chief Financial Officer, was named its sole Chief Executive Officer;

●

	●	Andrew Schwartz, a respected financial industry veteran and credit, debt and equity financing expert, was elected as a member of the Company’s board of directors. Mr. Schwartz stepped down in June 2024.

	●	Robert Arigo, a respected hotelier was appointed as Chief Executive Officer of the Company in June 2024.

	●	Michael James, a respected financial industry veteran was appointed as Chief Financial Officer in June 2024.

Capital Raises

On May 23, 2024, the Company sold 35,075,000 common shares for $8,768,750 netting $7,026,437 after fees.

On June 27, 2024, the Company sold 8,000,000 common shares and 8,000,000 rights for $2,000,000 netting $1,834.000 after fees.

On July 18, 2024, the Company sold 4,500,000 common shares for $765,000 netting $703,800 after fees.

On July 31, 2024, the Company sold 11,573,333 common shares for $1,736,000 netting $1,530,800 after fees.

In August 2024, the Company has raised through the sale of convertible debt $3,012,000 netting $2,815,000 after fees.

Amended and Restated Claw Back Policy

Sale Restriction Waiver

Termination of Partnership Agreement

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, AS RESTATED (Policies)

3 Months Ended

Mar. 31, 2024

Accounting Policies [Abstract]

Basis of Presentation

Revenue Recognition

Use of Estimates

Going Concern

Cash and Cash Equivalents

Accounts Receivable, Channel Retained Funds, and Processor Retained Funds

Fair Value of Financial Instruments

Commissions

Income Taxes

Sales Tax

Paycheck Protection Program Loan (“PPP”)

Earnings Per Share (“EPS”)

Preferred Stock

RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Tables)

3 Months Ended

Mar. 31, 2024

Restatement Of Previously Issued Financial Statements

Condensed balance sheet

Condensed balance sheet
	As of March 31, 2024 (unaudited)
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
ASSETS
Current Assets
Cash and Cash Equivalents	$	994,904		$	-		$	994,904
Accounts Receivable, Net		486,067			-			486,067
Channel Retained Funds, Net		1,500,000			(1,500,000	)		-		a
Processor Retained Funds, Net		2,633,926			(2,633,926	)		-		b
Receivables from On-Line Travel Agencies, Net		6,749,769			(6,749,769	)		-		b
					(984,744	)				b
Receivables from City of New York and Landlords, Net		6,018,035			(3,201,640	)		1,831,651		c
Prepaid Expenses and Other Current Assets		1,361,114			(342,212	)		1,018,902		d
Prepaid Guarantee Trust - Related Party		672,750			-			672,750
Total Current Assets		20,416,565			(15,412,291	)		5,004,274
Other Assets
Furniture, Equipment and Leasehold Improvements, Net		677,559			-			677,559
Security Deposits - Noncurrent		20,607,413			-			20,607,413
Prepaid Expenses and Other Noncurrent Assets		5,974,276			-			5,974,276
Operating Lease Right-Of-Use Assets, Net		229,016,100			-			229,016,100
Total Other Assets		256,275,348			-			256,275,348
Total Assets	$	276,691,913		$	(15,412,291	)	$	261,279,622

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities
				$	3,738,225					b
Accounts Payable and Accrued Expenses	$	28,868,844			(1,827,157	)	$	30,779,912		c
Bookings Received in Advance		6,576,403			8,050,248			14,626,651		e
Short Term Business Financing, Net		3,733,417			-			3,733,417
Loans Payable - Current		1,666,108			-			1,666,108
Initial Direct Costs Leases - Current		300,000			-			300,000
Operating Lease Liabilies - Current		1,944,026			-			1,944,026
Development Incentive Advances - Current		8,893,987			-			8,893,987
Total Current Liabilities		51,982,785			9,961,316			61,944,101
Long-Term Liabilities
Loans Payable		1,447,720			-			1,447,720
Development Incentive Advances - Noncurrent		-			-			-
Initial Direct Costs Leases - Noncurrent		3,950,000			-			3,950,000
Operating Lease Liabilities - Noncurrent		231,815,657			-			231,815,657
Total Long-Term Liabilities		237,213,377			-			237,213,377
Total Liabilities		289,196,162			9,961,316			299,157,478
Mezzanine equity
13% Redeemable Preferred Stock; Liquidation Perference $25 per Share; 10,000,000 Shares Authorized; 294,144 shares issued and outstanding as of March 31, 2024		5,775,596			-			5,775,596
Commitments and Contingencies
Stockholders’ Deficit
Common Stock (90,000,000 shares authorized, issued, outstanding - 41,839,361)		418			-			418
Additional Paid In Capital		98,455,107			-			98,455,107
Accumulated Deficit		(116,735,370	)		(25,373,607	)		(142,108,977	)	a, b, c, d, e
Total Stockholders’ Deficit		(18,279,845	)		(25,373,607	)		(43,653,452	)
Total Liabilities and Stockholders’ Deficit	$	276,691,913		$	(15,412,291	)	$	261,279,622

Condensed income statement

Condensed income statement
	As of March 31, 2024 (unaudited)
	As Previously Reported			Restatement Adjustments			As Restated			Restatement References
Net Rental Revenue	$	29,101,207		$	(15,143,846	)	$	13,957,361		b, c, e
Rent Expense		8,344,007			-			8,344,007
Non-Cash Rent Expense Amortization		2,093,667			-			2,093,667
Surrender of Deposits		750,000			-			750,000
Other Expenses		22,508,411			1,842,212			24,350,623		a, d
Total Cost of Revenue		33,696,085			1,842,212			35,538,297
Gross (Loss) Profit		(4,594,878	)		(16,986,058	)		(21,580,936	)
General and Administrative Expenses		3,755,756			8,387,549			12,143,305		b
Non-Cash Issuance of Common Stock for Operating Expenses		304,925			-			304,925
Non-Cash Stock Compensation Expense		724,514			-			724,514
Non-Cash Stock Option Expense		152,339			-			152,339
Partnership Considerations		2,679,469			-			2,679,469
Total Operating Expenses		7,617,003			8,387,549			16,004,552
(Loss) Income from Operations		(12,211,881	)		(25,373,607	)		(37,585,488	)
Other Income (Expense)
Other Income		210,076			-			210,076
Cash Interest and Financing Costs		(2,459,800	)		-			(2,459,800	)
Non-Cash Financing Costs		(2,324,270	)		-			(2,324,270	)
Total Other Expense		(4,573,994	)		-			(4,573,994	)
Loss Before Provision for Income Taxes		(16,785,875	)		(25,373,607	)		(42,159,482	)
Provision for Income Taxes		-			-			-
Net Loss		(16,785,875	)		(25,373,607	)		(42,159,482	)
Preferred Stock Dividend		(238,992	)		-			(238,992	)
Net Loss Attributable to Common Stockholders	$	(17,024,867	)	$	(25,373,607	)	$	(42,398,474	)
Basic Loss Per Common Share	$	(0.35	)	$	(0.52	)	$	(0.87	)
Diluted Loss Per Common Share	$	(0.35	)	$	(0.52	)	$	(0.87	)
Basic and Diluted Weighted Average Number of Common Shares Outstanding		49,223,606			49,223,606			49,223,606

Stockholders' equity

Stockholders' equity
	Common Stock				Additional Paid in			Accumulated			Stockholders’			Restatement
	Shares		Value		Capital			Deficit			(Deficit)			References
Balance - December 31, 2023		39,462,440	$	394	$	90,437,155		$	(99,710,503	)	$	(9,272,954	)
Net Loss		-		-		-			(16,785,875	)		(16,785,875	)
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
Agreement		614,250		6		(6	)		-			-
Preferred Dividends		-		-		-			(238,992	)		(238,992	)
Restatement Items									(25,373,607	)		(25,373,607	)	a, b, c, d, e
Balance - March 31, 2024		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 Option Compensation 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
Restatement Items		-		-		-			-			-
Balance - March 31, 2023		29,392,464	$	293	$	22,367,539		$	(23,799,526	)	$	(1,431,694	)

Condensed Cash Flow Statement

Condensed Cash Flow Statement
	As of March 31, 2024 (unaudited)
	As Previously			Restatement			As			Restatement
	Reported			Adjustments			Restated			References
Cash Flows from Operating Activities
Net (Loss)	$	(16,785,875	)	$	(25,373,607	)	$	(42,159,482	)	a, b, c, d, e
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Writeoff of bad debts					7,843,456			7,843,456		b
Writeoff of channel retained funds security deposit					1,500,000			1,500,000		a
Writeoff of security deposits		750,000			-			750,000
Writeoff of vendor overpayment		50,000			-			50,000
Non-cash stock compensation expense		55,500			-			55,500
Non-cash stock director expense		577,576			-			577,576
Non-cash stock option expense		152,339			-			152,339
Depreciation expense		13,676			-			13,676
Shares issued for operating expenses		304,926			-			304,926
Modification of Warrants		2,036,200			-			2,036,200
Non-cash lease expense		10,146,639			-			10,146,639
Gain on lease exit		(209,811	)		-			(209,811	)
Non-cash foregiveness of Development Incentive Advances		(75,210	)		-			(75,210	)
Gain on sale of Treasury Bills		-			-			-
Non-cash Financing Charges Associated with Short Term Business Financing		286,576			-			286,576
Loss on Debt Extinguishment		-			-			-
Changes in operating assets and liabilities:
(Increase) Decrease in:
Accounts Receivable, Net		(156,180	)		-			(156,180	)
Receivables from On-Line Travel Agencies, Net		186,485			2,524,983			2,711,468		b
Receivables from City of New York and Landlords, Net		(1,432,665	)		3,201,640			1,768,975		c
Prepaid expense and other assets		(4,415,639	)		342,212			(4,073,427	)	d
Prepaid Guarantee Trust - Related Party		351,000			-			351,000
Security deposits		(1,050,000	)		-			(1,050,000	)
(Decrease) Increase in:								-
Accounts payable and accrued expenses		5,636,539			1,911,068			7,547,607		b, c
Operating lease liabilities		(8,050,548	)		-			(8,050,548	)
Rents received in advance		2,172,187			8,050,248			10,222,435		e
Accrued Income Taxes		-			-			-
Net cash provided by operating activities		(9,456,285	)		-			(9,456,285	)

Cash Flows from Investing Activities
Purchase of Furniture and Equipment		-			-			-
Proceeds from the sale of Treasury Bills		-			-			-
Net cash provided by investing activities		-			-			-

Cash Flows from Financing Activities
Deferred offering costs - net
Proceeds from (Repayments of) short term business financing - net		2,331,721			-			2,331,721
Warrant Exercises		4,800,000			-			4,800,000
Proceeds from Development Incentive Advances		3,000,500			-			3,000,500
Proceds from (Repayments of) loans payable - net		67			-			67
Repayments of loans payable - net		(194,955	)		-			(194,955	)
Preferred shareholder dividends paid		(238,992	)		-			(238,992	)
Net cash used in financing activities		9,698,341			-			9,698,341

Net Increase in Cash and Cash Equivalents and Restricted Cash		242,056			-			242,056
Cash and Cash Equivalents and Restricted Cash - beginning of the period		752,848			-			752,848
Cash and Cash Equivalents and Restricted Cash - end of the period		994,904			-			994,904

Cash and Cash Equivalents		994,904			-			994,904
Restricted Cash		-			-			-
Total Cash and Cash Equivalents and Restricted Cash	$	994,904		$	-		$	994,904

Supplemental Disclosures of Cash Flow Information
Taxes	$	-		$	-		$	-
Interest	$	1,598,784		$	-		$	1,598,784
Noncash operating activities:
Acquisition of New Operating Lease Right-of-Use Assets	$	-		$	-		$	-
Noncash financing activities:
Financed Initial Direct Costs for leases paid with common stock	$	91,435		$	-		$	91,435
Conversion of debt to common stock and additional paid-in capital	$	-		$	-		$	-

LEASES (Tables)

3 Months Ended

Mar. 31, 2024

Leases

Schedule of supplemental balance sheet information related to leases


	March 31, 2024		December 31, 2023
Operating lease right of use assets, net	$	229,016,100	$	241,613,588
Operating lease liabilities, current portion	$	1,944,026	$	1,982,281
Operating lease liabilities, net of current portion	$	231,815,657	$	242,488,610

Schedule of future minimum lease payments under the non-cancelable operating leases


Twelve Months Ending March 31,
2025	$	30,835,724
2026		31,709,210
2027		32,589,176
2028		33,826,455
2029		34,890,889
Thereafter		409,189,267
Total lease payment	$	573,040,721
Less interest		(339,281,038	)
Present value obligation		233,759,683
Short-term liability		1,944,026
Long-term liability	$	231,815,657

Schedule of other supplemental information related to operating lease


	March 31, 2024			March 31, 2023
Weighted average discount rate		12.15	%		10.0	%
Weighted average remaining lease term (years)		13.4 years			13.0 years

	Three Months Ended March 31, 2024		Three Months Ended March 31, 2023
Operating lease cost	$	10,146,639	$	6,456,680
Short-term lease cost	$	291,035	$	616,856
Total lease cost	$	10,437,674	$	7,073,536

LOANS PAYABLE – SBA – PPP LOAN (Tables)

3 Months Ended

Mar. 31, 2024

Loans Payable Sba Ppp Loan

Schedule of future minimum principal repayments of the SBA,PPP loans payable


For the Twelve Months Ending March 31,
2025	$	276,658

LOANS PAYABLE – SBA – EIDL LOAN (Tables)

3 Months Ended

Mar. 31, 2024

Loans Payable Sba Eidl Loan

Schedule of future minimum principal repayments of the SBA,EIDL loans payable


For the Twelve Months Ending March 31,
2025	$	18,699
2026		15,536
2027		16,129
2028		16,744
2029		17,383
Thereafter		698,828
Total	$	783,319

LOANS PAYABLE (Tables)

3 Months Ended

Mar. 31, 2024

Disclosure Loans Payable Abstract

Schedule of loans payable

Schedule of loans payable
	March 31, 2024		December 31, 2023
Original payable of $151,096 with additional net borrowings of $252,954, requires monthly payments of $1,500 until total payments of $404,050 have been made		356,012		338,512
Original payable of $553,175 with additional net borrowings of $72,237, requires monthly payments of $25,000 until total payments of $625,412 have been made		400,000		400,000
Original payable of $492,180 with additional net borrowings of $620,804 requires monthly payments of $25,000 until total payments of $1,112,984 have been made		865,618		865,618
Original amounts due of $195,000, related to services provided by a vendor, requires monthly payments of $10,000 through May 2022, then monthly payments of $25,000 through August 2022 at which time any remaining balance is due		20,000		20,000
Other borrowing		342,246		356,048
Less: Current maturities		1,370,751		1,360,609
	$	613,125	$	619,569

Schedule of future minimum principal repayments of the loans payable


For the Twelve Months Ending March 31,
2024	$	1,370,751
2025		613,125
Loans payable	$	1,983,876

STOCK OPTIONS, RESTRICTED STOCK UNITS AND WARRANTS (Tables)

3 Months Ended

Mar. 31, 2024

Equity [Abstract]

Schedule of Black-Scholes option pricing model was used with the following weighted assumptions for options granted


	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value
Outstanding at December 31, 2023		1,746,885		$	2.86		9.0	$	5,427,118
Granted		-			-
Exercised		-			-
Expired		-			-
Forfeited		(29,250	)		2.09
Outstanding at March 31, 2024		1,717,635		$	2.88		8.7	$	-
Exercisable at March 31, 2024		485,045		$	2.69		8.6	$	-

Schedule of status of non-vested options


	Number of Nonvested Options			Weighted Average Grant Date Fair Value
Nonvested options at December 31, 2023		1,257,590		$	2.93
Granted		-			-
Forfeited		-			-
Vested		(25,000	)	$	1.74
Nonvested options at March 31, 2024		1,232,590		$	2.95

Schedule of stock option activity

Schedule of stock option activity
	Number of Shares			Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value
Outstanding at December 31, 2023		5,442,000		$	4.68		4.7	$	7,038,940
Granted		-			-
Exercised		(1,450,000	)		3.31
Expired		-			-
Forfeited		-			-
Outstanding at March 31, 2024		3,992,000		$	2.92		4.4	$	-
Exercisable at March 31, 2024		3,992,000		$	2.92		4.4	$	-

EQUITY TRANSACTIONS (Tables)

3 Months Ended

Mar. 31, 2024

Equity Transactions

Schedule of equity transactions

Schedule of equity transactions
Description	General Ledger Account	Date	Shares		Price		Value
Non-employee loan payment	Loan payable	1/25/2024		20,008	$	4.57	$	91,437
Non-employee commission expense	Commission Expense	1/25/2024		10,079	$	4.57	$	46,061
Non-employee investor relations expense	Investor Relations Expense	1/30/2024		59,784	$	4.33	$	258,865
Non-employee director compensation	Non-Cash Issuance of Common Stock for Director Compensation Expenses	2/8/2024		197,800	$	2.92	$	577,576
Employee Compensation	Non-Cash Issuance of Common Stock for Compensation Expenses	3/15/2024		25,000	$	2.22	$	55,500
Subtotal				312,671			$	1,029,439

For the three months ended March 31, 2023

Description	General Ledger Account	Date	Shares		Price		Value
Non-employee Board members pursuant to related comp. policy	Non-Cash Stock Compensation Expense	3/1/2023		166,665	$	2.58	$	429,996
In connection with certain property finders’ fee arrangements	Non-Cash Issuance of Common Stock for Operating Expenses	3/17/2023		136,887	$	2.45	$	335,373
In connection with a consulting agreement	Non-Cash Issuance of Common Stock for Operating Expenses	2/10/2023		196,994	$	1.85	$	364,439
In connection with a marketing agreement	Non-Cash Issuance of Common Stock for Operating Expenses	2/10/2023		100,000	$	1.85	$	185,000
Subtotal				600,546			$	1,314,808

RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023	Mar. 31, 2023	Dec. 31, 2022
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
Receivables from City of New York and Landlords, Net	1,831,651	4,585,370
Prepaid Expenses and Other Current Assets	1,018,902
Prepaid Guarantee Trust - Related Party	672,750	1,023,750
Total Current Assets	5,004,274
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
Current Liabilities
Accounts Payable and Accrued Expenses	30,779,912
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 Liabilies - 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 Perference $25 per Share; 10,000,000 Shares Authorized; 294,144 shares issued and outstanding as of March 31, 2024	5,775,596	5,775,596
Stockholders’ Deficit
Common Stock (90,000,000 shares authorized, issued, outstanding - 41,839,361)	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)	$ (1,431,694)	$ (3,292,124)
Total Liabilities and Stockholders’ Deficit	261,279,622
Previously Reported [Member]
Current Assets
Cash and Cash Equivalents	994,904
Accounts Receivable, Net	486,067
Channel Retained Funds, Net	1,500,000
Processor Retained Funds, Net	2,633,926
Receivables from On-Line Travel Agencies, Net	6,749,769
Receivables from City of New York and Landlords, Net	6,018,035
Prepaid Expenses and Other Current Assets	1,361,114
Prepaid Guarantee Trust - Related Party	672,750
Total Current Assets	20,416,565
Other Assets
Furniture, Equipment and Leasehold Improvements, Net	677,559
Security Deposits - Noncurrent	20,607,413
Prepaid Expenses and Other Noncurrent Assets	5,974,276
Operating Lease Right-Of-Use Assets, Net	229,016,100
Total Other Assets	256,275,348
Total Assets	276,691,913
Current Liabilities
Accounts Payable and Accrued Expenses	28,868,844
Bookings Received in Advance	6,576,403
Short Term Business Financing, Net	3,733,417
Loans Payable - Current	1,666,108
Initial Direct Costs Leases - Current	300,000
Operating Lease Liabilies - Current	1,944,026
Development Incentive Advances - Current	8,893,987
Total Current Liabilities	51,982,785
Long-Term Liabilities
Loans Payable	1,447,720
Development Incentive Advances - Noncurrent
Initial Direct Costs Leases - Noncurrent	3,950,000
Operating Lease Liabilities - Noncurrent	231,815,657
Total Long-Term Liabilities	237,213,377
Total Liabilities	289,196,162
Mezzanine equity
13% Redeemable Preferred Stock; Liquidation Perference $25 per Share; 10,000,000 Shares Authorized; 294,144 shares issued and outstanding as of March 31, 2024	5,775,596
Stockholders’ Deficit
Common Stock (90,000,000 shares authorized, issued, outstanding - 41,839,361)	418
Additional Paid In Capital	98,455,107
Accumulated Deficit	(116,735,370)
Total Stockholders’ Deficit	(18,279,845)
Total Liabilities and Stockholders’ Deficit	276,691,913
Revision of Prior Period, Adjustment [Member]
Current Assets
Cash and Cash Equivalents
Accounts Receivable, Net
Channel Retained Funds, Net	(1,500,000)
Processor Retained Funds, Net	(2,633,926)
Receivables from On-Line Travel Agencies, Net	(6,749,769)
Receivables from City of New York and Landlords, Net	(3,201,640)
Prepaid Expenses and Other Current Assets	(342,212)
Prepaid Guarantee Trust - Related Party
Total Current Assets	(15,412,291)
Other Assets
Furniture, Equipment and Leasehold Improvements, Net
Security Deposits - Noncurrent
Prepaid Expenses and Other Noncurrent Assets
Operating Lease Right-Of-Use Assets, Net
Total Other Assets
Total Assets	(15,412,291)
Current Liabilities
Accounts Payable and Accrued Expenses	(1,827,157)
Bookings Received in Advance	8,050,248
Short Term Business Financing, Net
Loans Payable - Current
Initial Direct Costs Leases - Current
Operating Lease Liabilies - Current
Development Incentive Advances - Current
Total Current Liabilities	9,961,316
Long-Term Liabilities
Loans Payable
Development Incentive Advances - Noncurrent
Initial Direct Costs Leases - Noncurrent
Operating Lease Liabilities - Noncurrent
Total Long-Term Liabilities
Total Liabilities	9,961,316
Mezzanine equity
13% Redeemable Preferred Stock; Liquidation Perference $25 per Share; 10,000,000 Shares Authorized; 294,144 shares issued and outstanding as of March 31, 2024
Stockholders’ Deficit
Common Stock (90,000,000 shares authorized, issued, outstanding - 41,839,361)
Additional Paid In Capital
Accumulated Deficit	(25,373,607)
Total Stockholders’ Deficit	(25,373,607)
Total Liabilities and Stockholders’ Deficit	$ (15,412,291)

RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Details 1) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 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	(0)	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 Weighted Average Number of Common Shares Outstanding	49,223,606	28,659,358
Diluted Weighted Average Number of Common Shares Outstanding	49,223,606	28,659,358
Previously Reported [Member]
Net Rental Revenue	$ 29,101,207
Rent Expense	8,344,007
Non-Cash Rent Expense Amortization	2,093,667
Surrender of Deposits	750,000
Other Expenses	22,508,411
Total Cost of Revenue	33,696,085
Gross (Loss) Profit	(4,594,878)
General and Administrative Expenses	3,755,756
Non-Cash Issuance of Common Stock for Operating Expenses	304,925
Non-Cash Stock Compensation Expense	724,514
Non-Cash Stock Option Expense	152,339
Partnership Considerations	2,679,469
Total Operating Expenses	7,617,003
(Loss) Income from Operations	(12,211,881)
Other Income (Expense)
Other Income	210,076
Cash Interest and Financing Costs	(2,459,800)
Non-Cash Financing Costs	(2,324,270)
Total Other Expense	(4,573,994)
Loss Before Provision for Income Taxes	(16,785,875)
Provision for Income Taxes	(0)
Net Loss	(16,785,875)
Preferred Stock Dividend	(238,992)
Net Loss Attributable to Common Stockholders	$ (17,024,867)
Basic Loss Per Common Share	$ (0.35)
Diluted Loss Per Common Share	$ (0.35)
Basic Weighted Average Number of Common Shares Outstanding	49,223,606
Diluted Weighted Average Number of Common Shares Outstanding	49,223,606
Revision of Prior Period, Adjustment [Member]
Net Rental Revenue	$ (15,143,846)
Rent Expense
Non-Cash Rent Expense Amortization
Surrender of Deposits
Other Expenses	1,842,212
Total Cost of Revenue	1,842,212
Gross (Loss) Profit	(16,986,058)
General and Administrative Expenses	8,387,549
Non-Cash Issuance of Common Stock for Operating Expenses
Non-Cash Stock Compensation Expense
Non-Cash Stock Option Expense
Partnership Considerations
Total Operating Expenses	8,387,549
(Loss) Income from Operations	(25,373,607)
Other Income (Expense)
Other Income
Cash Interest and Financing Costs
Non-Cash Financing Costs
Total Other Expense
Loss Before Provision for Income Taxes	(25,373,607)
Provision for Income Taxes	(0)
Net Loss	(25,373,607)
Preferred Stock Dividend
Net Loss Attributable to Common Stockholders	$ (25,373,607)
Basic Loss Per Common Share	$ (0.52)
Diluted Loss Per Common Share	$ (0.52)
Basic Weighted Average Number of Common Shares Outstanding	49,223,606

RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Details 2) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Balance - December 31, 2022	$ (9,272,954)	$ (3,292,124)
Net Loss	(16,785,875)	(2,780,534)
Non-Cash Stock Compensation Expense	633,076	429,996
Non-Cash Option Compensation Expense		167,573
Non-Cash Option Compensation Expense	152,339
Issuance of Shares for Operating Expenses	304,926	884,816
Conversion of loans		2,700,000
Modification of Warrants	2,036,200
Warrant Exercise	4,800,000	400,000
Loss on Debt Extinguishment		58,579
Issuance of Shares to Satisfy Loans	91,435
Agreement
Preferred Dividends	(238,992)
Restatement Items	(25,373,607)
Balance - March 31, 2023	(43,653,452)	(1,431,694)
Common Stock [Member]
Balance - December 31, 2022	$ 394	$ 276
Beginning balance, shares	39,462,440	27,691,918
Net Loss
Non-Cash Stock Compensation Expense	$ 2	$ 2
Non-Cash Stock Compensation Expense, shares	222,800	166,665
Non-Cash Option Compensation Expense
Non-Cash Option Compensation Expense
Issuance of Shares for Operating Expenses	$ 1	$ 4
Issuance of Shares for Operating Expenses, shares	69,863	433,881
Conversion of loans		$ 9
Conversion of Loans, shares		900,000
Modification of Warrants
Warrant Exercise	$ 15	$ 2
Warrant Exercise, shares	1,450,000	200,000
Loss on Debt Extinguishment
Issuance of Shares to Satisfy Loans
Issuance of Shares to Satisfy Loans, shares	20,008
Agreement	$ (6)
Issuance of Shares for Revenue Share Agreements, shares	614,250
Preferred Dividends
Restatement Items
Balance - March 31, 2023	$ 418	$ 293
Ending balance, shares	41,839,361	29,392,464
Additional Paid-in Capital [Member]
Balance - December 31, 2022	$ 90,437,155	$ 17,726,592
Net Loss
Non-Cash Stock Compensation Expense	633,074	429,994
Non-Cash Option Compensation Expense		167,573
Non-Cash Option Compensation Expense	152,339
Issuance of Shares for Operating Expenses	304,925	884,812
Conversion of loans		2,699,991
Modification of Warrants	2,036,200
Warrant Exercise	4,799,985	399,998
Loss on Debt Extinguishment		58,579
Issuance of Shares to Satisfy Loans	91,435
Agreement	6
Preferred Dividends
Restatement Items
Balance - March 31, 2023	98,455,107	22,367,539
Retained Earnings [Member]
Balance - December 31, 2022	(99,710,503)	(21,018,992)
Net Loss	(16,785,875)	(2,780,534)
Non-Cash Stock Compensation Expense
Non-Cash Option Compensation Expense
Non-Cash Option Compensation Expense
Issuance of Shares for Operating Expenses
Conversion of loans
Modification of Warrants
Warrant Exercise
Loss on Debt Extinguishment
Issuance of Shares to Satisfy Loans
Agreement
Preferred Dividends	(238,992)
Restatement Items	(25,373,607)
Balance - March 31, 2023	$ (142,108,977)	$ (23,799,526)

RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Details 3) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023
Cash Flows from Operating Activities
Net (Loss)	$ (42,159,482)	$ (2,780,534)
Adjustments to reconcile net (loss) income 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
Modification of Warrants	2,036,200
Non-cash lease expense	10,146,639	6,456,386
Gain on lease exit	(209,811)
Non-cash foregiveness 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
(Increase) Decrease in:
Accounts Receivable, Net	(156,180)
Receivables from On-Line Travel Agencies, Net	2,711,468
Receivables from City of New York and Landlords, Net	1,768,975
Prepaid expense and other assets	(4,073,427)	261,157
Prepaid Guarantee Trust - Related Party	351,000
Security deposits	(1,050,000)	(3,907,720)
(Decrease) Increase in:
Accounts payable and accrued expenses	7,547,607	1,024,948
Operating lease liabilities	(8,050,548)	(4,804,716)
Rents received in advance	10,222,435	2,630,239
Accrued Income Taxes		122,161
Net cash provided by operating activities	(9,456,285)
Cash Flows from Investing Activities
Purchase of Furniture and Equipment		(249,762)
Proceeds from the sale of Treasury Bills		2,692,396
Net cash provided by investing activities		2,442,634
Cash Flows from Financing Activities
Proceeds from (Repayments of) short term business financing - net	2,331,721	(1,255,512)
Warrant Exercises	4,800,000	400,000
Proceeds from Development Incentive Advances	3,000,500
Proceds from (Repayments of) loans payable - net	67	(165,896)
Repayments of loans payable - net	(194,955)
Preferred shareholder dividends paid	(238,992)
Net cash used in financing activities	9,698,341	(1,021,408)
Net Increase in Cash and Cash Equivalents and Restricted Cash	242,056
Cash and Cash Equivalents and Restricted Cash - beginning of the period	752,848
Cash and Cash Equivalents and Restricted Cash - end of the period	994,904
Cash and Cash Equivalents	994,904	2,880,909
Restricted Cash		1,100,000
Total Cash and Cash Equivalents and Restricted Cash	994,904	3,980,909
Supplemental Disclosures of Cash Flow Information
Taxes
Interest	1,598,784	2,130,605
Noncash operating activities:
Acquisition of New Operating Lease Right-of-Use Assets		88,267,775
Noncash financing activities:
Financed Initial Direct Costs for leases paid with common stock	91,435
Conversion of debt to common stock and additional paid-in capital		$ 2,700,000
Previously Reported [Member]
Cash Flows from Operating Activities
Net (Loss)	(16,785,875)
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Writeoff of security deposits	750,000
Writeoff of vendor overpayment	50,000
Non-cash stock compensation expense	55,500
Non-cash stock director expense	577,576
Non-cash stock option expense	152,339
Depreciation expense	13,676
Shares issued for operating expenses	304,926
Modification of Warrants	2,036,200
Non-cash lease expense	10,146,639
Gain on lease exit	(209,811)
Non-cash foregiveness of Development Incentive Advances	(75,210)
Gain on sale of Treasury Bills
Non-cash Financing Charges Associated with Short Term Business Financing	286,576
Loss on Debt Extinguishment
(Increase) Decrease in:
Accounts Receivable, Net	(156,180)
Receivables from On-Line Travel Agencies, Net	186,485
Receivables from City of New York and Landlords, Net	(1,432,665)
Prepaid expense and other assets	(4,415,639)
Prepaid Guarantee Trust - Related Party	351,000
Security deposits	(1,050,000)
(Decrease) Increase in:
Accounts payable and accrued expenses	5,636,539
Operating lease liabilities	(8,050,548)
Rents received in advance	2,172,187
Accrued Income Taxes
Net cash provided by operating activities	(9,456,285)
Cash Flows from Investing Activities
Purchase of Furniture and Equipment
Proceeds from the sale of Treasury Bills
Net cash provided by investing activities
Cash Flows from Financing Activities
Proceeds from (Repayments of) short term business financing - net	2,331,721
Warrant Exercises	4,800,000
Proceeds from Development Incentive Advances	3,000,500
Proceds from (Repayments of) loans payable - net	67
Repayments of loans payable - net	(194,955)
Preferred shareholder dividends paid	(238,992)
Net cash used in financing activities	9,698,341
Net Increase in Cash and Cash Equivalents and Restricted Cash	242,056
Cash and Cash Equivalents and Restricted Cash - beginning of the period	752,848
Cash and Cash Equivalents and Restricted Cash - end of the period	994,904
Cash and Cash Equivalents	994,904
Restricted Cash
Total Cash and Cash Equivalents and Restricted Cash	994,904
Supplemental Disclosures of Cash Flow Information
Taxes
Interest	1,598,784
Noncash operating activities:
Acquisition of New Operating Lease Right-of-Use Assets
Noncash financing activities:
Financed Initial Direct Costs for leases paid with common stock	91,435
Conversion of debt to common stock and additional paid-in capital
Revision of Prior Period, Adjustment [Member]
Cash Flows from Operating Activities
Net (Loss)	(25,373,607)
Adjustments to reconcile net (loss) income 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
Writeoff of vendor overpayment
Non-cash stock compensation expense
Non-cash stock director expense
Non-cash stock option expense
Depreciation expense
Shares issued for operating expenses
Modification of Warrants
Non-cash lease expense
Gain on lease exit
Non-cash foregiveness of Development Incentive Advances
Gain on sale of Treasury Bills
Non-cash Financing Charges Associated with Short Term Business Financing
Loss on Debt Extinguishment
(Increase) Decrease in:
Accounts Receivable, Net
Receivables from On-Line Travel Agencies, Net	2,524,983
Receivables from City of New York and Landlords, Net	3,201,640
Prepaid expense and other assets	342,212
Prepaid Guarantee Trust - Related Party
Security deposits
(Decrease) Increase in:
Accounts payable and accrued expenses	1,911,068
Operating lease liabilities
Rents received in advance	8,050,248
Accrued Income Taxes
Net cash provided by operating activities
Cash Flows from Investing Activities
Purchase of Furniture and Equipment
Proceeds from the sale of Treasury Bills
Net cash provided by investing activities
Cash Flows from Financing Activities
Proceeds from (Repayments of) short term business financing - net
Warrant Exercises
Proceeds from Development Incentive Advances
Proceds from (Repayments of) loans payable - net
Repayments of loans payable - net
Preferred shareholder dividends paid
Net cash used in financing activities
Net Increase in Cash and Cash Equivalents and Restricted Cash
Cash and Cash Equivalents and Restricted Cash - beginning of the period
Cash and Cash Equivalents and Restricted Cash - end of the period
Cash and Cash Equivalents
Restricted Cash
Total Cash and Cash Equivalents and Restricted Cash
Supplemental Disclosures of Cash Flow Information
Taxes
Interest
Noncash operating activities:
Acquisition of New Operating Lease Right-of-Use Assets
Noncash financing activities:
Financed Initial Direct Costs for leases paid with common stock
Conversion of debt to common stock and additional paid-in capital

RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Bad debt expense	$ 7,843,456
Processor Retained Funds, Net			$ 2,633,926
Receivables from On-Line Travel Agencies, Net
Receivables from City of New York and Landlords, Net	1,768,975
Prepaid Expenses and Other Current Assets	(1,018,902)
Bookings Received in Advance	14,626,651		$ 4,404,216
Previously Reported [Member]
Processor Retained Funds, Net	2,633,926
Receivables from On-Line Travel Agencies, Net	6,749,769
Receivables from City of New York	984,744
Increase in Accounts payable and accrued expenses	3,738,224
Decrease in Net Rental Revenue	6,263,207
Increase in General and Administrative Expenses	8,387,549
Receivables from City of New York and Landlords, Net	(1,432,665)
Prepaid Expenses and Other Current Assets	(1,361,114)
Bookings Received in Advance	6,576,403
Revision of Prior Period, Adjustment [Member]
Bad debt expense	7,843,456
Processor Retained Funds, Net	(2,633,926)
Receivables from On-Line Travel Agencies, Net	(6,749,769)
Decrease in Net Rental Revenue	830,390
Receivables from City of New York and Landlords, Net	3,201,640
Decrease in accounts payable	1,827,157
Prepaid Expenses and Other Current Assets	342,212
Bookings Received in Advance	$ 8,050,248

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, AS RESTATED (Details Narrative) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Accounting Policies [Abstract]
Rents received in advance	$ 14,626,651		$ 4,404,216
Net loss	(42,159,482)		78,523,377
Working capital deficit	56,939,827
Cash and cash equivalents	994,904		752,848
Receivables write off			2,947,780
Reserve for credit losses			529,000
Pays commissions to third-party	6,192,305	$ 3,073,533
Tax provision	(0)	$ 122,161
Accrued sales tax payable	$ 363,952		$ 3,266,302

LEASES (Details) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Leases
Operating lease right of use assets, net	$ 229,016,100	$ 241,613,588
Operating lease liabilities, current portion	1,944,026	1,982,281
Operating lease liabilities, net of current portion	$ 231,815,657	$ 242,488,610

LEASES (Details 1) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Leases
2025	$ 30,835,724
2026	31,709,210
2027	32,589,176
2028	33,826,455
2029	34,890,889
Thereafter	409,189,267
Total lease payment	573,040,721
Less interest	(339,281,038)
Present value obligation	233,759,683
Short-term liability	(1,944,026)	$ (1,982,281)
Long-term liability	$ 231,815,657	$ 242,488,610

LEASES (Details 2) - USD ($)	3 Months Ended
LEASES (Details 2) - USD ($)	Mar. 31, 2024	Mar. 31, 2023
Leases
Weighted average discount rate	12.15%	10.00%
Weighted average remaining lease term (years)	13 years 4 months 24 days	13 years
Operating lease cost	$ 10,146,639	$ 6,456,680
Short-term lease cost	291,035	616,856
Total lease cost	$ 10,437,674	$ 7,073,536

ACCOUNTS RECEIVABLES, PROCESSOR AND CHANNEL RETAINED FUNDS, AS RESTATED (Details Narrative) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Defined Benefit Plan Disclosure [Line Items]
Channel retained funds	$ 0	$ 1,500,000
Processor retained funds	0	2,633,926
Other receivables	351,651	329,987
Allowances for credit losses		393,412
Other allowances for credit losses		486,708
OTA [Member]
Defined Benefit Plan Disclosure [Line Items]
Receivables from related party	0	6,936,254
Allowances for credit losses		529,000
City Of New York And Landlords [Member]
Defined Benefit Plan Disclosure [Line Items]
Receivables from related party	$ 1,480,000	$ 4,585,370

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES, AS RESTATED (Details Narrative) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Payables and Accruals [Abstract]
Accounts payable and accrued expenses	$ 30,779,912	$ 23,182,305
Accrued payroll and related liabilities	1,203,000	2,024,000
Utilities fees	3,329,000	3,265,000
Legal exposure	9,783,000	8,400,000
Sales and other taxes	4,912,000	3,910,000
Rent	3,258,000	1,737,000
Interest expense	850,000
Telephone and cable expense	289,000
Insurance expense	627,000	194,000
Professional fees	246,000	590,000
Repairs, maintenance, and improvements	960,000	719,000
Supplies and sundries	582,000	420,000
Cleaning expense	317,000
Initial franchise fees paid on behalf of the Company by a related party	563,000
Commissions	123,000	632,000
Printing expenses	216,000	263,000
Refunds due customers	3,738,000
Other miscellaneous items	$ 690,000	42,000
Bank and service fees		288,223
Processing fees		52,000
License fees and public relations		94,000
Director fees		231,000
Internet and software expense		$ 71,000

LOANS PAYABLE - SBA - PPP LOAN (Details)	Mar. 31, 2024 USD ($)
Loans Payable Sba Ppp Loan
2025	$ 276,658

LOANS PAYABLE – SBA – PPP LOAN (Details Narrative) - USD ($)	Mar. 31, 2024	Dec. 31, 2023	Jan. 30, 2023	Dec. 20, 2022	May 31, 2020	Apr. 30, 2020	Mar. 27, 2020
Short-Term Debt [Line Items]
Original amount of loans payable			$ 1,250,000	$ 3,000,000
PPP Loan [Member]
Short-Term Debt [Line Items]
Original amount of loans payable					$ 298,958	$ 516,225	$ 10,000,000
Accrued interest	$ 6,318	$ 5,571

LOANS PAYABLE - SBA - EIDL LOAN (Details)	Mar. 31, 2024 USD ($)
Loans Payable Sba Eidl Loan
2025	$ 18,699
2026	15,536
2027	16,129
2028	16,744
2029	17,383
Thereafter	698,828
Total	$ 783,319

LOANS PAYABLE – SBA – EIDL LOAN (Details Narrative)	1 Months Ended			12 Months Ended
LOANS PAYABLE – SBA – EIDL LOAN (Details Narrative)	Jul. 25, 2022 USD ($)	Jun. 18, 2022 USD ($)	Apr. 21, 2022 USD ($)	Dec. 31, 2020 Integer	Mar. 31, 2024 USD ($)	Dec. 31, 2023 USD ($)	Jan. 30, 2023 USD ($)	Dec. 20, 2022 USD ($)	Dec. 31, 2021	Jul. 25, 2020 USD ($)	Jun. 18, 2020 USD ($)	Apr. 21, 2020 USD ($)
Short-Term Debt [Line Items]
Original amount of loans payable							$ 1,250,000	$ 3,000,000
EIDL [Member]
Short-Term Debt [Line Items]
Number of loans \| Integer				3
Loan payable term				30 years
Interest rate of loans payable									3.75%	3.75%	3.75%	3.75%
Original amount of loans payable										$ 150,000	$ 150,000	$ 500,000
Monthly payments of principal and interest	$ 731	$ 731	$ 2,437
Loans payable - SBA - EIDL Loan					$ 783,319	$ 786,950
Accrued interest					$ 27,644	$ 8,966

SHORT-TERM BUSINESS FINANCING (Details Narrative) - USD ($)	Mar. 31, 2024	Dec. 31, 2023
Short-term Business Financing
Merchant cash advances net of unamortized fees	$ 3,733,417	$ 1,115,120

LOANS PAYABLE (Details) - USD ($)	3 Months Ended
LOANS PAYABLE (Details) - USD ($)	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023	Jan. 30, 2023	Dec. 20, 2022
Short-Term Debt [Line Items]
Original amount of loans payable				$ 1,250,000	$ 3,000,000
Loans payable	$ 1,983,876
Other borrowing	342,246		$ 356,048
Less: Current maturities	1,370,751		1,360,609
Loans payable non current	613,125		619,569
Original borrowings of $250,000, bears interest at 1%, requires no payments until maturity in January 2024 [Member]
Short-Term Debt [Line Items]
Original amount of loans payable	151,096		151,096
Additional borrowings	252,954		252,954
Monthly payment of loans payable	1,500	$ 1,500
Total payments made	404,050		404,050
Loans payable	356,012		338,512
Original payable of $151,096 with additional net borrowings of $89,154, requires monthly payments of $1,500 until total payments of $240,250 have been made [Member]
Short-Term Debt [Line Items]
Original amount of loans payable	553,175		553,175
Additional borrowings	72,237		72,237
Monthly payment of loans payable	25,000	25,000
Total payments made	625,412		625,412
Loans payable	400,000		400,000
Original payable of $553,175 with additional net borrowings of $125,412, requires monthly payments of $25,000 until total payments of $678,587 have been made [Member]
Short-Term Debt [Line Items]
Original amount of loans payable	492,180		492,180
Additional borrowings	620,804		620,804
Monthly payment of loans payable	25,000	25,000
Total payments made	1,112,984		1,112,984
Loans payable	865,618		865,618
Original borrowings of $60,000, bears interest at 1%, requires no payments until maturity in January 2024 [Member]
Short-Term Debt [Line Items]
Original amount of loans payable	195,000		195,000
Additional borrowings	10,000		10,000
Monthly payment of loans payable	25,000	$ 25,000
Loans payable	$ 20,000		$ 20,000

LOANS PAYABLE (Details 1)	Mar. 31, 2024 USD ($)
Disclosure Loans Payable Abstract
2024	$ 1,370,751
2025	613,125
Loans payable	$ 1,983,876

LINE OF CREDIT (Details Narrative) - USD ($)	3 Months Ended
LINE OF CREDIT (Details Narrative) - USD ($)	Mar. 31, 2024	Dec. 31, 2023	Feb. 28, 2019
Line of Credit Facility [Line Items]
Interest rate description	prime, 8.25% as of March 31, 2024, plus 3.49%.
Line of Credit	$ 69,975	$ 69,975
Line of Credit [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity			$ 95,000

RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)	1 Months Ended		3 Months Ended
	Dec. 31, 2023	Dec. 20, 2022	Mar. 31, 2024	Mar. 31, 2023	Jan. 31, 2023	Jan. 30, 2023
Related Party Transaction [Line Items]
Aggregate principal amount		$ 3,000,000				$ 1,250,000
Conversion of common stock shares		1,000,000
Conversion price		$ 3.00
Debt amount converted				$ 300,000
Entired converted amount	$ 3,000,000
Provided conversion shares					874,474
Mr. Ferdinand [Member]
Related Party Transaction [Line Items]
Repayment of debt			$ 1,500,000
Ferdinand [Member]
Related Party Transaction [Line Items]
Payment to related party	1,350,000		351,000
Other Prepaid Expense, Current	$ 1,023,750		672,750
Related party expenses			$ 351,000

RISKS AND UNCERTAINTIES (Details Narrative)	Mar. 31, 2024 USD ($)
Revenue Benchmark [Member] \| Customer Concentration Risk [Member] \| Three Sales Channels [Member]
Concentration Risk [Line Items]
FDIC insured amount	$ 250,000

MAJOR SALES CHANNELS (Details Narrative)	3 Months Ended
MAJOR SALES CHANNELS (Details Narrative)	Mar. 31, 2024	Mar. 31, 2023
Revenue Benchmark [Member] \| Customer Concentration Risk [Member] \| Third Party Sales Channels [Member]
Product Information [Line Items]
Total rental revenue, percentage	85.00%	85.00%

STOCK OPTIONS, RESTRICTED STOCK UNITS AND WARRANTS (Details)	3 Months Ended
	Mar. 31, 2024 USD ($) $ / shares shares
Equity [Abstract]
Outstanding at the beginning (in shares) \| shares	1,746,885
Outstanding at the beginning (in dollars per shares) \| $ / shares	$ 2.86
Weighted Average Remaining Contractual Life (years)	9 years
Aggregate intrinsic value, outstanding at the beginning \| $	$ 5,427,118
Granted (in shares) \| shares
Granted (in dollars per shares) \| $ / shares
Exercised (in shares) \| shares
Exercised (in dollars per shares) \| $ / shares
Expired (in shares) \| shares
Expired (in dollars per shares) \| $ / shares
Forfeited (in shares) \| shares	(29,250)
Forfeited (in dollars per shares) \| $ / shares	$ 2.09
Outstanding at the end (in shares) \| shares	1,717,635
Outstanding at the end (in dollars per shares) \| $ / shares	$ 2.88
Weighted Average Remaining Contractual Life (years)	8 years 8 months 12 days
Aggregate intrinsic value, outstanding at the end \| $
Number of share exercisable \| shares	485,045
Weighted Average Exercise Price exercisable \| $ / shares	$ 2.69
Weighted Average Remaining Contractual Life (years)	8 years 7 months 6 days
Aggregate Intrinsic Value exercisable \| $

STOCK OPTIONS, RESTRICTED STOCK UNITS AND WARRANTS (Details 1)	3 Months Ended
	Mar. 31, 2024 $ / shares shares
Equity [Abstract]
Nonvested options at the beginning \| shares	1,257,590
Nonvested options at the beginning (in dollars per share) \| $ / shares	$ 2.93
Granted \| shares
Granted (in dollars per share) \| $ / shares
Forfeited \| shares
Forfeited (in dollars per share) \| $ / shares
Vested \| shares	(25,000)
Vested (in dollars per share) \| $ / shares	$ 1.74
Nonvested options at the end \| shares	1,232,590
Nonvested options at the end (in dollars per share) \| $ / shares	$ 2.95

STOCK OPTIONS, RESTRICTED STOCK UNITS AND WARRANTS (Details 2)	3 Months Ended
	Mar. 31, 2024 USD ($) $ / shares shares
Equity [Abstract]
Outstanding at the beginning \| shares	5,442,000
Outstanding at the beginning (in dollars per share) \| $ / shares	$ 4.68
Outstanding at the beginning (in years)	4 years 8 months 12 days
Aggregate Intrinsic Value at the beginning \| $	$ 7,038,940
Granted \| shares
Granted (in dollars per share) \| $ / shares
Exercised \| shares	(1,450,000)
Exercised (in dollars per share) \| $ / shares	$ 3.31
Expired \| shares
Expired (in dollars per share) \| $ / shares
Forfeited \| shares
Forfeited (in dollars per share) \| $ / shares
Outstanding at the end \| shares	3,992,000
Outstanding at the end (in dollars per share) \| $ / shares	$ 2.92
Outstanding at the end (in years)	4 years 4 months 24 days
Aggregate Intrinsic Value at the end \| $
Exercisable \| shares	3,992,000
Exercisable (in dollars per share) \| $ / shares	$ 2.92
Exercisable (in years)	4 years 4 months 24 days
Aggregate intrinsic value exercisable \| $

STOCK OPTIONS, RESTRICTED STOCK UNITS AND WARRANTS (Details Narrative) - USD ($)			1 Months Ended								3 Months Ended		12 Months Ended
	Nov. 06, 2023	Aug. 11, 2023	Mar. 31, 2024	Dec. 27, 2023	Dec. 17, 2023	Apr. 16, 2023	Feb. 15, 2023	Oct. 30, 2022	Sep. 30, 2022	Sep. 16, 2022	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Subsidiary, Sale of Stock [Line Items]
Stock option expense											$ 152,339	$ 167,573
Unamortized option expense			$ 1,137,358								$ 1,137,358
Unamortized option expense expected to be recognized over a weighted average period											11 months 1 day
Number of aggregate shares granted													100,000
Fair value of all restricted shares			$ 220,000
Number of warrants issued
Weighted average exercise price			$ 2.92								$ 2.92		$ 4.68
Warrant expense				$ 3,081,400	$ 4,187,800		$ 167,573
Proceeds from warrant exercised											$ 4,800,000	$ 400,000
Lender Agreement [Member]
Subsidiary, Sale of Stock [Line Items]
Warrants description						On April 16, 2023 in conjunction with an agreement with certain lenders, the Company issued warrants to purchase up to 1,000,000 shares of the Company’s common stock with an exercise price of $3.00 per share, and warrants to purchase up to 250,000 shares of our common stock with an exercise price of $4.00 per share. All of these warrants have a term of 5 years and expire in April of 2028. Under this agreement, these lenders would be required to exercise all or a portion of these warrants if the Company’s common stock traded at prices between $3.00 per share and $4.00 per share for a prescribed number of trading days. On June 19, 2023, this agreement was modified to convert all of related outstanding debt in exchange for a reduction in the exercise price of all of these warrants to $2.50 per share.
Non-cash financing expenses						$ 259,074
Officers and directors [Member] \| IPO [Member]
Subsidiary, Sale of Stock [Line Items]
Number of warrants issued		695,000
Weighted average exercise price		$ 4.20
WP		5 years
Underwriter [Member]
Subsidiary, Sale of Stock [Line Items]
Number of warrants issued		135,000
Maxim [Member] \| Private Placement [Member]
Subsidiary, Sale of Stock [Line Items]
Number of warrants issued		32,000
Weighted average exercise price		$ 4.40
WP		5 years
Third-party Investor [Member]
Subsidiary, Sale of Stock [Line Items]
Number of warrants issued		920,000						366,562	352,188	517,500
Weighted average exercise price		$ 4.00						$ 4.00	$ 4.00	$ 4.00
Shareholders [Member]
Subsidiary, Sale of Stock [Line Items]
Number of warrants issued	2,000,000
Weighted average exercise price	$ 4.00
Warrant expense	$ 4,939,000
Warrant Holders [Member]
Subsidiary, Sale of Stock [Line Items]
Number of warrants issued				1,000,000	2,000,000
Weighted average exercise price				$ 5.50	$ 5.00
Number of warrants exercised				500,000	1,000,000
Proceeds from warrant exercised				$ 2,000,000	$ 4,000,000
Unvested Restricted Shares [Member]
Subsidiary, Sale of Stock [Line Items]
Unrecognized compensation cost			$ 166,500								$ 166,500

Revenue Share Exchange (Details Narrative) - USD ($)	1 Months Ended				3 Months Ended
Revenue Share Exchange (Details Narrative) - USD ($)	Jul. 31, 2024	Jul. 18, 2024	Jun. 27, 2024	May 23, 2024	Mar. 31, 2024	Jun. 30, 2023
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Interest Expenses						$ 28,174,148
Shares issued	11,573,333	4,500,000	8,000,000	35,075,000
Greenle Beta [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Shares issued					36,179
Greenle Alpha [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Shares issued					578,071

WYNDHAM AGREEMENTS (Details Narrative) - USD ($) $ in Thousands	Aug. 02, 2023	Mar. 31, 2024
Development incentive advances		$ 2,600
Minimum [Member]
Agreements terms	15 years
Maximum [Member]
Agreements terms	20 years

REDEEMABLE PREFERRED STOCK (Details Narrative) - USD ($)		1 Months Ended	3 Months Ended
	Dec. 05, 2023	Oct. 26, 2023	Mar. 31, 2024	Mar. 31, 2023	Dec. 31, 2023
Preferred stock stated value			$ 25		$ 25
Number of share sold			312,671	600,546
Series A Preferred Stock [Member]
Number of share issued		280,000
Interest rate		13.00%
Preferred stock stated value		$ 25
Dividends outstanding			$ 238,992
Series A Preferred Stock [Member] \| Over-Allotment Option [Member]
Number of share sold	14,144
Number of share sold net proceeds	$ 5,775,596

EQUITY TRANSACTIONS (Details) - USD ($)	3 Months Ended
EQUITY TRANSACTIONS (Details) - USD ($)	Mar. 31, 2024	Mar. 31, 2023
Shares	312,671	600,546
Value	$ 1,029,439	$ 1,314,808
Non Employee Loan Payment [Member]
Shares	20,008
Price	$ 4.57
Value	$ 91,437
Non Employee Commission Expense [Member]
Shares	10,079
Price	$ 4.57
Value	$ 46,061
Non Employee Investor Relations Expense [Member]
Shares	59,784
Price	$ 4.33
Value	$ 258,865
Non Employee Director Compensation [Member]
Shares	197,800
Price	$ 2.92
Value	$ 577,576
Employee Compensation [Member]
Shares	25,000
Price	$ 2.22
Value	$ 55,500
Non Employee Board Members Pursuant To Related Comp Policy [Member]
Shares		166,665
Price		$ 2.58
Value		$ 429,996
In Connection With Certain Property Finders Fee Arrangements [Member]
Shares		136,887
Price		$ 2.45
Value		$ 335,373
In Connection With A Consulting Agreement [Member]
Shares		196,994
Price		$ 1.85
Value		$ 364,439
In Connection With A Marketing Agreement [Member]
Shares		100,000
Price		$ 1.85
Value		$ 185,000

SUBSEQUENT EVENTS (Details Narrative) - USD ($)	1 Months Ended
SUBSEQUENT EVENTS (Details Narrative) - USD ($)	Aug. 31, 2024	Jul. 31, 2024	Jul. 18, 2024	Jun. 27, 2024	May 23, 2024	Apr. 30, 2024	Apr. 22, 2024	Mar. 31, 2024
Subsequent Events [Abstract]
Number of common share sold during the period		11,573,333	4,500,000	8,000,000	35,075,000
Value of common share sold during the period		$ 1,736,000	$ 765,000	$ 2,000,000	$ 8,768,750
Fees	$ 2,815,000	$ 1,530,800	$ 703,800	$ 1,834.000	$ 7,026,437
Number of right sold during the period				8,000,000
Proceeds from convertible debt	$ 3,012,000
Annual fee							$ 100,000
Annual grant							250,000
Monthly consulting fee							$ 50,000
Sale Restriction Waiver description						Company secured from Greenle Partners LLC Series Alpha P.S. (“Greenle Alpha”) and Greenle Partners LLC Series Beta P.S. (“Greenle Beta” and, together with Greenle Alpha, “Greenle”) a waiver on the restrictions contained in its financing agreements with the Company that prohibits the Company’s sales of shares of common stock prior to November 2024 at per-share prices below $5.00 (as may be adjusted for stock splits and similar transactions, the “Trigger Price”). The restriction on sales of common stock by the Company below the Trigger Price terminates in November 2024. This waiver permitted the Company to sell up to an aggregate of 15 million shares prior to November 2024 at prices below the Trigger Price. In consideration of this waiver, Greenle is entitled to be issued up to an aggregate of 2.8 million shares of our common stock (“Initial Greenle Waiver Shares”) from time to time upon written notice to our company. This waiver was amended in May 2024 to increase number of shares permitted to be sold by the Company at prices under the Trigger Price prior to November 2024 to the greater of (i) 30 million shares and (ii) $30 million (based on the gross sale prices of such shares). In consideration of this waiver modification, Greenle is entitled to demand from time to time that the Company issue an amount of additional shares (the “Additional Greenle Waiver Shares” and collectively with the Initial Greenle Shares and the Greenle Revenue Participation Shares, the “Greenle Shares”) equal to 0.22 shares of common stock for each share of common stock sold by the Company through November 6, 2024 in excess of 15 million shares at prices below the Trigger Price.
Development incentive advances								$ 2,600,000

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