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What changed in XCel Brands, Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of XCel Brands, Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+282 added−341 removedSource: 10-K (2026-04-15) vs 10-K (2025-05-28)

Top changes in XCel Brands, Inc.'s 2025 10-K

282 paragraphs added · 341 removed · 215 edited across 5 sections

Item 1. Business

Business — how the company describes what it does

41 edited+10 added−26 removed35 unchanged
Biggest changeCurrently, our brand portfolio consists of the following: ● the Halston brands (the "Halston Brand"), the Judith Ripka brands (the "Ripka Brand"), and the C Wonder brands (the "C Wonder Brand"), which are wholly owned by the Company; ● the TowerHill by Christie Brinkley brand (the “CB Brand”), which is a co-branded collaboration between Xcel and Christie Brinkley that launched in May 2024; ● the LB70 by Lloyd Boston brand (the “LB Brand”), which is a co-branded collaboration between Xcel and Lloyd Boston that launched in August 2024; ● the Longaberger brand (the “Longaberger Brand”), which we manage through our 50% ownership interest in Longaberger Licensing, LLC; and ● the Isaac Mizrahi brands (the “Isaac Mizrahi Brand”), in which we hold a noncontrolling interest through our 17.5% ownership interest in IM Topco, LLC (“IM Topco”) and continue to contribute to the operations of the brand through a service agreement with IM Topco.
Biggest changeCurrently, our brand portfolio consists of the following: ● the Halston brands (the "Halston Brand"), the Judith Ripka brands (the "Ripka Brand"), and the C Wonder brands (the "C Wonder Brand"), which are wholly owned by the Company; ● the Longaberger by Shannon Doherty brand (the “Longaberger Brand”), which we manage through our 50% ownership interest in Longaberger Licensing, LLC; ● the TowerHill by Christie Brinkley brand (the “CB Brand”), which is a co-branded collaboration between Xcel and Christie Brinkley that launched in May 2024; ● the Trust-Respect-Love by Cesar Millan brand, which is a new co-branded collaboration between Xcel and Cesar Millan that is planned to launch in Spring 2026; ● the GemmaMade by Gemma Stafford brand, which is a new co-branded collaboration between Xcel and baking influencer Gemma Stafford that is planned to launch in Spring 2026; ● the Off/Duty by Coco Rocha brand, which is a new co-branded collaboration between Xcel and Coco Rocha, which is planned to launch in Fall 2026; and ● Mesa Mia by Jenny Martinez, which is a brand owned by Mexican home influencer Jenny Martinez, and for which Xcel holds the television rights through a long-term license agreement and expects to launch in Spring 2026.
We also market Halston Brand through www.halston.com, the Judith Ripka brand through www.judithripka.com, the C Wonder brand through www.cwonder.com, and the Longaberger brand through www.longaberger.com. Through our websites, we are able to present the products under our brands to customers with branding that reflects each brand’s heritage and unique point of view.
We also market the Halston Brand through www.halston.com, the Judith Ripka brand through www.judithripka.com, the C Wonder brand through www.cwonder.com, and the Longaberger brand through www.longaberger.com. Through our websites, we are able to present the products under our brands to customers with branding that reflects each brand’s heritage and unique point of view.
We believe that the following factors help differentiate our Company in an increasingly crowded competitive landscape: ● our management team, including our officers’ and directors’ historical track records and relationships within the industry; ● our brand management platform, which has a strong focus on design, product, marketing, and technology; and ● our operating strategies of licensing brands with significant media presence and driving sales through our true omni-channel retail sales strategy across interactive television, live streaming, and e-commerce distribution channels.
We believe that the following factors help differentiate our Company in an increasingly crowded competitive landscape: ● our management team, including our officers’ and directors’ historical track records and relationships within the industry; ● our brand management platform, which has a strong focus on design, product, marketing, and technology; and ● our operating strategies of licensing brands with significant media presence and driving sales through our omni-channel retail sales strategy across interactive television, live streaming, and e-commerce distribution channels.
Through our wholly owned subsidiaries and joint ventures, we have entered into direct-to-retail license agreements with Qurate, collectively referred to as the Qurate Agreements (individually, each a “Qurate Agreement”), pursuant to which we design, and Qurate sources and sells, various products under the C Wonder Brand, the CB Brand, the LB Brand, and the Longaberger Brand.
Through our wholly owned subsidiaries and joint ventures, we have entered into direct-to-retail license agreements with Qurate, collectively referred to as the Qurate Agreements (individually, each a “Qurate Agreement”), pursuant to which we design, and Qurate sources and sells, various products under the C Wonder Brand, the CB Brand, and the Longaberger Brand.
We will endeavor, where possible, to require licensees to provide guaranteed minimum royalties under their license agreements. Our licensees currently sell our branded licensed products through brick-and-mortar retailers, e-commerce, and in certain cases supply products to interactive television companies for sale through their television programs and/or through their internet websites.
We endeavor, where possible, to require licensees to provide guaranteed minimum royalties under their license agreements. Our licensees currently sell our branded licensed products through brick-and-mortar retailers, e-commerce, and in certain cases supply products to interactive television companies for sale through their television programs and/or through their internet websites.
Given our true omni-channel retail sales strategy focusing on the sale of branded products through various distribution channels (including live-streaming, e-commerce, interactive television, and traditional brick-and-mortar sales channels), our marketing efforts currently focus on leveraging micro- and mega-influencers, entertainment tie-ins, PR and editorial, social media campaigns, personal appearances, and digital content in order to drive retail sales of product and consumer awareness across our various sales distribution channels.
Given our omni-channel retail sales strategy focusing on the sale of branded products through various distribution channels (including live-streaming, e-commerce, interactive television, and brick-and-mortar sales channels), our marketing efforts currently focus on leveraging micro- and mega-influencers, entertainment tie-ins, PR and editorial, social media campaigns, personal appearances, and digital content in order to drive retail sales of product and consumer awareness across our various sales distribution channels.
Halston The Halston brand was founded by Roy Halston Frowick in the 1960s, and quickly became one of the most important American fashion brands in the world, becoming synonymous with glamour, sophistication, and femininity. Halston’s groundbreaking designs and visionary style still influence designers around the world today.
Our Brand Portfolio Halston The Halston brand was founded by Roy Halston Frowick in the 1960s, and quickly became one of the most important American fashion brands in the world, becoming synonymous with glamour, sophistication, and femininity. Halston’s groundbreaking designs and visionary style still influence designers around the world today.
Our efforts also include promoting namesakes of our brands and our personalities through various media including live-streaming, television, design for performances, and other events. We also work with our retail partners to leverage their marketing resources, including e-commerce platforms and related digital marketing campaigns, social media platforms, direct mail pieces, and public relations efforts.
Our efforts also include promoting namesakes of our brands and our personalities through various media including live-streaming, television, design for performances, and other events. We also work with our retail 9 Table of Contents partners to leverage their marketing resources, including e-commerce platforms and related digital marketing campaigns, social media platforms, direct mail pieces, and public relations efforts.
Other Licensing Agreements We have entered into certain other licensing agreements for sales and distribution through e-commerce and traditional brick-and-mortar retailers. Authorized distribution channels include department stores, mass merchant retailers, clubs, and national specialty retailers.
Other Licensing Agreements We have entered into certain other licensing agreements for sales and distribution through e-commerce and brick-and-mortar retailers. Authorized distribution channels typically include department stores, mass merchant retailers, clubs, and national specialty retailers.
Halston Master License ​ On May 15, 2023, the Company, through our wholly owned subsidiaries, H Halston, LLC and H Heritage Licensing, LLC (collectively, the “Licensor”), entered into a master license agreement relating to the Halston Brand (the “Halston Master License”) with G-III (as licensee) for men’s and women’s apparel, men’s and women’s fashion accessories, children’s apparel and accessories, home, airline amenity and amenity kits, and such other product categories as mutually agreed upon.
Halston Master License ​ On May 15, 2023, the Company, through our wholly owned subsidiaries, H Halston, LLC and H Heritage Licensing, LLC (collectively, the “Licensor”), entered into a master license agreement relating to the Halston Brand (the “Halston Master License”) with G-III (as licensee) for men’s and women’s apparel, men’s and women’s fashion accessories, children’s apparel and accessories, home, airline amenity and amenity kits, and such other product categories as mutually agreed 8 Table of Contents upon.
Our other license agreements cover 9 Table of Contents various categories, including but not limited to women’s apparel, footwear, and accessories; bath and body; jewelry; home products; men’s apparel and accessories; children’s and infant apparel, footwear, and accessories; and electronics cases and accessories. The terms of the agreements generally range from three to six years with renewal options.
Our other license agreements cover various categories, including but not limited to women’s apparel, footwear, and accessories; bath and body; jewelry; home products; men’s apparel and accessories; children’s and infant apparel, footwear, and accessories; and electronics cases and accessories. The terms of the agreements generally range from three to six years with renewal options.
Because many of our competitors have significantly greater cash, revenues, and resources than we do, we must work to differentiate ourselves from our direct and indirect competitors to successfully compete for market share with the brands 10 Table of Contents we own and for future acquisitions.
Because many of our competitors have significantly greater cash, revenues, and resources than we do, we must work to differentiate ourselves from our direct and indirect competitors to successfully compete for market share with the brands we own and for future acquisitions.
Qurate is the largest licensee for our C Wonder, Towerhill by Christie Brinkley, and LB70 by Lloyd Boston brands. We employ and manage on-air spokespersons under each of these brands in order to promote products under our brands on QVC and HSN.
Qurate is the largest licensee for our C Wonder and Towerhill by Christie Brinkley brands. We employ and manage on-air spokespersons under each of these brands in order to promote products under our brands on QVC and HSN.
However, we are generally restricted from selling products under the specified respective brands or trademarks to certain mass merchants. For the years ended December 31, 2024 and 2023, net licensing revenue from Qurate collectively accounted for approximately 44% and 34%, respectively, of the total net revenue of the Company.
However, we are generally restricted from selling products under the specified respective brands or trademarks to certain mass merchants. For the years ended December 31, 2025 and 2024, net licensing revenue from Qurate collectively accounted for approximately 20% and 44%, respectively, of the total net revenue of the Company.
The Company intends to renew and maintain registrations as appropriate prior to expiration and it makes efforts to diligently prosecute all pending applications consistent with the Company’s business goals. In addition, the Company registers its trademarks in certain other countries and regions around the world as it deems appropriate.
The Company intends to renew and maintain registrations as appropriate prior to expiration and it makes efforts to diligently prosecute all pending 10 Table of Contents applications consistent with the Company’s business goals. In addition, the Company registers its trademarks in certain other countries and regions around the world as it deems appropriate.
Potential acquisitions may include established or newer brands that do or would perform well in live streaming or social commerce, direct-to-consumer brands or platforms with significant consumer following, or established media 7 Table of Contents companies which could benefit from our expertise in direct-response television, live streaming, and social commerce.
Potential acquisitions may include established or newer brands that do or would perform well in live streaming or social commerce, direct-to-consumer brands or platforms with significant consumer following, or established media companies which could benefit from our expertise in direct-response television, live streaming, and social commerce.
These deferred revenue contract liabilities are being recognized ratably as revenue through December 31, 2028. For the year ended December 31, 2024 and 2023, net licensing revenue from the Halston Master License accounted for approximately 31% and 9%, respectively, of the total net revenue of the Company.
These deferred revenue contract liabilities are being recognized ratably as revenue through December 31, 2028. For the year ended December 31, 2025 and 2024, net licensing revenue from the Halston Master License accounted for approximately 52% and 31%, respectively, of the total net revenue of the Company.
Trademarks The Company, through its wholly owned subsidiaries, owns and exploits the Halston brands, which include the trademarks and brands Halston, Halston Heritage, Roy Frowick, H by Halston, and H Halston; the Ripka brands, which include the trademarks and brands Judith Ripka LTD, Judith Ripka Collection, Judith Ripka Legacy, Judith Ripka, and Judith Ripka Sterling; the C Wonder brands, which include the trademarks and brands C Wonder and C Wonder Limited, the TowerHill brand, and the LB70 brand.
Trademarks The Company, through its wholly owned subsidiaries, owns and exploits the Halston brands, which include the trademarks and brands Halston, Halston Heritage, Roy Frowick, H by Halston, and H Halston; the Ripka brands, which include the trademarks and brands Judith Ripka LTD, Judith Ripka Collection, Judith Ripka Legacy, Judith Ripka, and Judith Ripka Sterling; the C Wonder brands, which include the trademarks and brands C Wonder and C Wonder Limited, the TowerHill brand, the Trust-Love-Respect brand, and the GemmaMade brand.
The brand is best known for its distinctive handwoven baskets. We acquired a 50% ownership interest in this brand through a business venture with Hilco Global in November 2019, and are actively managing this brand to build on its history and bring it into the future as a digital first live-streaming and social commerce business.
We acquired a 50% ownership interest in this brand through a business venture with Hilco Global in November 2019, and are actively managing this brand to build on its history and bring it into the future as a digital first live-streaming and social commerce business.
The Halston brand is available across various distribution channels – including premium and better department stores, e-commerce, interactive television, and national specialty retailers – through our long-term master license agreement with G-III Apparel Group. Judith Ripka Judith Ripka is a luxury jewelry brand founded by Judith Ripka in 1977.
The Halston brand is available across various distribution channels – including premium and 5 Table of Contents better department stores, e-commerce, interactive television, and national specialty retailers – through our long-term master license agreement with G-III Apparel Group. Judith Ripka Judith Ripka is a luxury jewelry brand founded by Judith Ripka in 1977, which we acquired in in 2014.
This brand has become known worldwide for its distinctive designs featuring intricate metalwork, vibrant colors, and distinctive use of texture. The Judith Ripka Fine Jewelry collection consists of pieces in 18 karat gold and sterling silver with precious colored jewels and diamonds, and is currently available in fine jewelry stores, luxury retailers, and via e-commerce.
This brand has become known worldwide for its distinctive designs featuring intricate metalwork, vibrant colors, and distinctive use of texture. The Judith Ripka Fine Jewelry collection consists of pieces in 18 karat gold and sterling silver with precious colored jewels and diamonds, and is currently available through interactive television and e-commerce through our master license agreement with JTV .
On March 24, 2025, the Company filed an amendment to its Amended and Restated Certificate of Incorporation to effect a one-for-ten (1:10) reverse stock split of the shares of the Company’s common stock.
On September 29, 2011, we changed our name to Xcel Brands, Inc. On March 24, 2025, the Company filed an amendment to its Amended and Restated Certificate of Incorporation to effect a one-for-ten (1:10) reverse stock split of the shares of the Company’s common stock.
This brand is built upon a foundation of bold, vibrant colors and exceptional, eye-catching prints that celebrate the art of everyday dressing. C Wonder offers women’s clothing, footwear, jewelry and accessories, and delightful surprises at every turn. We acquired the C Wonder Brand in July 2015. The brand is currently available through HSN.
C Wonder The C Wonder brand was founded by J. Christopher Burch in 2011. This brand is built upon a foundation of bold, vibrant colors and exceptional, eye-catching prints that celebrate the art of everyday dressing. C Wonder offers women’s clothing, footwear, jewelry and accessories, and delightful surprises at every turn.
The Licensor granted G-III a security interest in the Halston trademarks to secure the Licensor’s obligations under the Halston Master License, including to honor the obligations under the purchase option. ​ As a result of the upfront cash payment and guaranteed minimum royalties discussed above, the Company has recognized deferred revenue contract liabilities on its consolidated balance sheet as of December 31, 2024 and 2023 of $3.56 million and $4.44 million, respectively, of which $0.89 million was classified as a current liability at each balance sheet date and the remainder was classified as a long-term liability.
The Licensor granted G-III a security interest in the Halston trademarks to secure the Licensor’s obligations under the Halston Master License, including to honor the obligations under the purchase option. ​ As a result of the upfront cash payment and guaranteed minimum royalties discussed above, as well as certain other advance payments of royalties received from G-III, the Company recognized deferred revenue contract liabilities on its consolidated balance sheet as of December 31, 2025 and 2024 of $3.09 million and $3.56 million, respectively, at each balance sheet date.
While these are both new brands for Xcel, they represent brands that we co-developed with low up-front costs and for which we were able to leverage our unique experience, relationships, and social commerce knowledge to launch.
While this was a new brand for Xcel, it represents a brand that we co-developed with low up-front costs and for which we were able to leverage our unique experience, relationships, and social commerce knowledge to launch.
The Company seeks to require its licensing partners to advise the Company of any violations of its trademark rights of which its licensing partners become aware and relies primarily upon a combination of federal, state, and local laws, as well as contractual restrictions to protect its intellectual property rights both domestically and internationally. 11 Table of Contents Human Capital Our employees’ knowledge, social, and personality attributes enable our company to achieve its goals, develop our business, and remain innovative.
The Company seeks to require its licensing partners to advise the Company of any violations of its trademark rights of which its licensing partners become aware and relies primarily upon a combination of federal, state, and local laws, as well as contractual restrictions to protect its intellectual property rights both domestically and internationally.
TowerHill by Christie Brinkley TowerHill by Christie Brinkley is a new co-branded collaboration between Xcel Brands, Inc. and Christie Lee Brinkley, an iconic American supermodel with over one million followers on social media. The brand launched on HSN in May 2024, with plans to license and launch products outside of HSN starting in 2025.
TowerHill by Christie Brinkley TowerHill by Christie Brinkley is a co-branded collaboration between Xcel Brands, Inc. and Christie Lee Brinkley, an iconic American supermodel with over one million followers on social media. The brand launched on HSN in May 2024. Trust-Respect-Love by Cesar Millan This brand is a co-branded collaboration between Xcel Brands, Inc. and renowned dog behaviorist Cesar Millan.
We were also previously party to similar agreements with Qurate related to the IsaacMizrahiLIVE brand, the Judith Ripka brand, and the LOGO by Lori Goldstein brand. Qurate owns the rights to all designs produced under these agreements, and the agreements include the sale of products across various categories through Qurate’s television media and related internet sites.
Qurate owns the rights to all designs produced under these agreements, and the agreements include the sale of products across various categories through Qurate’s television media and related internet sites.
As of December 31, 2024, we had 21 employees. We value our employees and are committed to providing a healthy and safe work environment. For certain key employees, including our executives, brand ambassadors, and spokespersons, we typically enter into multi-year employment agreements. Overall, we believe that our relationship with our employees is good.
For certain key employees, including our executives, brand ambassadors, and spokespersons, we typically enter into multi-year employment agreements. Overall, we believe that our relationship with our employees is good. None of our employees are represented by a labor union.
To grow our brands, we are focused on the following primary strategies: ● distribution and/or licensing our brands for sale through interactive television (e.g., QVC, HSN, America’s Collectible Network, Inc. d/b/a JTV (“JTV”), etc.); ● licensing of our brands to retailers that sell to the end consumer; ● licensing our brands to manufacturers and retailers for promotion and distribution through e-commerce, social commerce, and traditional brick-and-mortar retail channels; and ● acquiring additional consumer brands and integrating them into our operating platform, and leveraging our operating infrastructure and distribution relationships. 4 Table of Contents We believe that Xcel offers a unique value proposition to our retail and direct-to-consumer customers and our licensees for the following reasons: ● our management team, including our officers’ and directors’ experience in, and relationships within the industry; ● our deep knowledge, expertise, and proprietary technology in live streaming and social commerce; ● our design, sales, marketing, and technology platform that enables us to design trend-right product; and ● our significant media and digital presence.
To grow our brands, we are focused on the following primary strategies: ● licensing of our brands for sale through interactive television (e.g., QVC, HSN, America’s Collectible Network, Inc. d/b/a JTV (“JTV”), etc.); ● licensing of our brands to retailers that sell to the end consumer; 4 Table of Contents ● licensing our brands to manufacturers and retailers for promotion and distribution through e-commerce, social commerce, and brick-and-mortar retail channels; and ● acquiring additional consumer brands and integrating them into our operating platform, and leveraging our operating infrastructure and distribution relationships.
See “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Obligations and Commitments – Contingent Obligations – Issaac Mizrahi Transaction.” Growth Strategy We plan to continue to grow our brands and business through three primary strategies: ● organic growth in our existing brands; ● developing new brands that are well positioned in social commerce; and ● the acquisition of brands and businesses that fit our long-term strategy.
Today our brands reach over 46 million people on social media. Growth Strategy We plan to continue to grow our brands and business through three primary strategies: ● organic growth in our existing brands; ● developing new brands that are well positioned in social commerce; and ● the acquisition of brands and businesses that fit our long-term strategy.
In connection with the Qurate Agreements and during the same periods, Qurate and its subsidiaries have the exclusive, worldwide right to use the names, likenesses, images, voices, and performances of our spokespersons to promote the respective products. ​ ​ ​ ​ ​ ​ ​ Agreement Current Term Expiry Automatic Renewal Product Launch C Wonder Qurate Agreement (HSN) ​ December 31, 2026 ​ two-year period ​ March 2023 TowerHill by Christie Brinkley Qurate Agreement (HSN) ​ May 30, 2027 ​ three-year period ​ May 2024 LB70 by Lloyd Boston Qurate Agreement (HSN) ​ December 31, 2025 two-year period August 2024 Longaberger Qurate Agreement (QVC) ​ October 31, 2025 two-year period November 2019 ​ ● On June 30, 2024, in connection with the divestiture of the Lori Goldstein Brand, the agreement with Qurate related to the LOGO by Lori Goldstein brand was assigned to assumed by the counterparties to the divestiture transaction. 8 Table of Contents ● On August 30, 2022, Qurate and Xcel amended the licensing agreement for the Judith Ripka brand to terminate the license period effective December 31, 2021.
In connection with the Qurate Agreements and during the same periods, Qurate and its subsidiaries have the exclusive, worldwide right to use the names, likenesses, images, voices, and performances of our spokespersons to promote the respective products. ​ ​ ​ ​ ​ ​ ​ Agreement ​ ​ ​ Current Term Expiry ​ ​ ​ Automatic Renewal ​ ​ ​ Product Launch C Wonder Qurate Agreement (HSN) ​ December 31, 2026 ​ two-year period ​ March 2023 TowerHill by Christie Brinkley Qurate Agreement (HSN) ​ May 30, 2027 ​ three-year period ​ May 2024 Longaberger Qurate Agreement (QVC) ​ October 31, 2027 two-year period November 2019 ​ Under the Qurate Agreements, Qurate is obligated to make payments to us on a quarterly basis, based upon the net retail sales of the specified branded products.
In 2024 we launched our initial brand, the Longaberger brand, on ORME. Licensing Our working-capital-light “licensing plus” business model allows us to focus on our core competencies of design, marketing, and brand management without the investment requirements in inventory associated with traditional consumer product companies.
While our overall long-term business strategy is not dependent on such acquisitions, we carefully consider potential acquisitions as a means to leverage our infrastructure and expertise and accelerate our growth. 7 Table of Contents Licensing Our working-capital-light “licensing plus” business model allows us to focus on our core competencies of design, marketing, and brand management without the investment requirements in inventory associated with traditional consumer product companies.
We expect retail sales volume for the brand to continue to increase in 2025 and beyond. With respect to developing new brands, we recently developed and successfully launched the TowerHill by Christie Brinkley and LB70 by Lloyd Boston brands in 2024.
Under these partnerships, the business and corresponding royalty revenues to Xcel for these brands have increased, and we expect that they will continue to increase in 2026 and beyond. With respect to developing new brands, we recently developed and successfully launched the TowerHill by Christie Brinkley brand in 2024.
Xcel continues to pioneer a true omni-channel and social commerce sales strategy which includes the promotion and sale of products under its brands through interactive television, digital live-stream shopping, social commerce, traditional brick-and-mortar retailers, and e-commerce channels, to be everywhere its customers shop.
Xcel is pioneering a true omni-channel and social commerce sales strategy which includes the promotion and sale of products under its brands through interactive television, digital live-stream shopping, social commerce, brick-and-mortar retailers, and e-commerce channels. We currently operate under a working-capital light model, with our licensees and/or retail partners responsible for the procurement and sale of inventory.
On September 29, 2011, we changed our name to Xcel Brands, Inc. Our principal office is currently located at 550 Seventh Avenue, 11th Floor, New York, NY 10018. Our telephone number is (347) 727-2474. Our corporate website is www.xcelbrands.com. Additionally, we maintain websites for our respective brands at www.halston.com, www.judithripka.com, www.cwonder.com, www.longaberger.com, and www.isaacmizrahi.com.
Our principal office is currently located at 550 Seventh Avenue, 11th Floor, New York, NY 10018. Our telephone number is (347) 727-2474. Our corporate website is www.xcelbrands.com.
Where laws limit our ability to record in our name trademarks that we have purchased, we have obtained by way of license all necessary rights to operate our business. Certain of these trademarks and associated marks are registered or pending registration with the U.S.
We manage and have a 50% ownership interest in the brands and trademarks of the Longaberger brand through our business venture with Hilco Global. Where laws limit our ability to record in our name trademarks that we have purchased, we have obtained by way of license all necessary rights to operate our business.
With respect to organic growth in our existing brands, we entered into master license agreements for our Halston Brand and Judith Ripka Brand in 2023, and launched the C Wonder Brand on HSN. ● The Halston master license agreement is with G-III Apparel Group (“G-III”), which is one of the largest designers and suppliers of wholesale apparel and accessories in the world, with annual revenues of over $3 billion.
With respect to organic growth in our existing brands, we have entered into contractual arrangements with best-in-class business partners – including a master license agreement for our Halston Brand with G-III Apparel Group (“G-III”), one of the largest designers and suppliers of wholesale apparel and accessories in the world; a master license agreement for our Judith Ripka Brand with America’s Collectible Network, Inc. d/b/a JTV (“JTV”) which covers both interactive television and e-commerce operations; a licensing arrangement with HSN for our C Wonder Brand, and an outsourcing agreement for the e-commerce operations of the Longaberger Brand.
The brand launched on HSN in August 2024, with plans to launch accessories on HSN in 2025 and additional retail distribution in Fall 2025. Longaberger Longaberger is an iconic American heritage home and collectibles brand that began making baskets in 1896 and launched a direct sales company in 1973 by the Longaberger family.
We acquired the C Wonder Brand in 2015, and it is currently available through interactive television and e-commerce through HSN. Longaberger Longaberger is an iconic American heritage home and collectibles brand that began making baskets in 1896 and launched a direct sales company in 1973 by the Longaberger family. The brand is best known for its distinctive handwoven baskets.
Based on the performance of the brands launched in 2024, we believe this is a viable strategy that will help drive short-term and long-term growth for our company.
Based on the performance of the TowerHill brand, we believe this is a viable strategy that will help drive short-term and long-term growth for our company. In 2025, we entered into and announced partnerships with Cesar Millan, Gemma Stafford, Coco Rocha, Shannon Doherty, and Jenny Martinez to develop more new brand collaborations, which are planned to launch in 2026.
We launched our Longaberger e-commerce and live-streaming operations in February 2020. In the fourth quarter of 2023, we outsourced the operations and management of the brand’s e-commerce business to a third party. 6 Table of Contents Isaac Mizrahi Isaac Mizrahi is an iconic American brand that stands for timeless, cosmopolitan style.
We launched our Longaberger e-commerce and live-streaming operations in February 2020; in 2023, we outsourced the operations and management of the brand’s e-commerce business to a third party. In November 2025, we announced a new partnership with Shannon Doherty, creator of At Home with Shannon, to introduce a new collection designed to bring warmth, style, and functionality to every home.
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We also own a 19% interest in ORME Live Inc. (“ORME”), a short-form video and social commerce marketplace that launched in April 2024.
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Additionally, through October 1, 2025, we held a noncontrolling interest in the Isaac Mizrahi brands (the “Isaac Mizrahi Brand”). On October 1, 2025, we divested our remaining noncontrolling interest in the Isaac Mizrahi Brand.
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Our brands have generated over $5 billion in retail sales via live streaming in interactive television and digital channels alone, and our brands collectively reach over 5 million social media followers through Facebook, Instagram, and TikTok. All of the followers may not be unique followers, as many followers may follow multiple brands and follow our brands on multiple platforms.
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As such, our revenues primarily consist of royalty revenues, and we do not have risk of carrying aged inventory. As a result, fluctuations in product costs and tariffs do not have a direct impact on us, but may impact us indirectly as our royalty revenues are typically based on the net sales and success of our licensees.
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Recent Developments Prior to 2023, the Company engaged in certain wholesale and direct-to-consumer sales of products under its brands.
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We believe that Xcel offers a unique value proposition for the following reasons: ● our management team, including our officers’ and directors’ experience in and relationships within the industry; ● our deep knowledge, expertise, and proprietary technology in live streaming and social commerce; ● our design, sales, marketing, and technology platform that enables us to design trend-right product; and ● our significant media and digital presence.
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In 2023, we signed master license agreements for our Halston Brand and Ripka Brand, and license agreements for the supply of products under certain of our brands to HSN, that enabled us to outsource a majority of our wholesale and direct-to-consumer operations and revert to a working capital light business model.
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This innovative brand will offer a range of high-quality pet products, including toys and training tools, aimed at enhancing the relationship between pets and their owners based on the principles of trust, respect, and love. The brand is expected to launch in Spring 2026, featuring availability through various retail and e-commerce channels.
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In addition to licensing out the brands described above, we outsourced the operations of Longaberger through a license agreement with a third party to operate and manage the Longaberger e-commerce website in the fourth quarter of 2023.
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GemmaMade by Gemma Stafford This brand is a co-branded collaboration between Xcel Brands, Inc. and chef and baking expert Gemma Stafford. This new kitchen brand is designed to bring stylish, functional, and approachable tools to everyday bakers and home cooks. The brand is expected to launch in Spring 2026.
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In 2024, we launched the Longaberger Brand on ORME, a short-form video and social commerce marketplace, and launched the new TowerHill by Christie Brinkley brand as well as the LB70 by Lloyd Boston brand on HSN.
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Off/Duty by Coco Rocha This brand is a co-branded collaboration between Xcel Brands, Inc. and high-fashion model Coco Rocha. This brand aims to offer uncomplicated, high-style, and comfortable wardrobe essentials for a woman on the go.
Removed
On June 30, 2024, we divested the LOGO by Lori Goldstein brand (the “Lori Goldstein Brand”), which was a wholly owned brand from April 1, 2021 through June 30, 2024.
Added
The brand is expected to launch in Fall 2026. 6 Table of Contents Mesa Mia by Jenny Martinez Mesa Mia is a new brand owned by Mexican home influencer Jenny Martinez, for which Xcel holds the television rights through a long-term license agreement.
Removed
None of the content on our websites is incorporated by reference into this Annual Report on Form 10-K. 5 Table of Contents Our Brand Portfolio Currently, our brand portfolio consists of the Halston, Ripka, C Wonder, CB, LB, Longaberger, and Isaac Mizrahi Brands, and other proprietary brands, including the various labels under these brands.
Added
This brand is a dynamic new food brand inspired by the bold flavors, rich traditions, and spirit of Latin cooking, and will offer a curated line of food products designed to bring delicious, authentic meals to the kitchens of Jenny’s fans with ease and flair. The brand is expected to launch on TSC in Spring 2026.
Removed
We acquired the Ripka brand in April 2014. In 2017 and 2018, we launched our Judith Ripka Fine Jewelry e-commerce operations and wholesale operations; these businesses were subsequently licensed to JTV in the first quarter of 2023. C Wonder The C Wonder brand was founded by J. Christopher Burch in 2011.
Added
Certain of these trademarks and associated marks are registered or pending registration with the U.S.
Removed
LB70 by Lloyd Boston LB70 by Lloyd Boston is a new co-branded collaboration between Xcel Brands, Inc. and Lloyd Boston, a 30-year veteran of the fashion industry and former Vice President of the multibillion-dollar Tommy Hilfiger brand, as well as a best-selling author.
Added
Human Capital Our employees’ knowledge, social, and personality attributes enable our company to achieve its goals, develop our business, and remain innovative. As of December 31, 2025, we had 15 employees. We value our employees and are committed to providing a healthy and safe work environment.
Removed
Isaac Mizrahi, the designer, launched his eponymous label in 1987 to critical acclaim, including four Council of Fashion Designers of America (CFDA) awards. Since then, this brand has become known and beloved around the world for its colorful and stylish designs.
Removed
As a true lifestyle brand, under Xcel’s ownership it has expanded into over 150 different product categories including sportswear, footwear, handbags, watches, eyewear, tech accessories, home, and other merchandise.
Removed
The brand is available across various distribution channels to reach customers wherever they shop: better department stores, such as Saks and Hudson’s Bay; interactive television, including QVC and HSN; and national specialty retailers. The brand is also sold in various global locations, including Canada, Italy, the United Kingdom, and Japan.
Removed
We acquired the Isaac Mizrahi brand in September 2011, and in May 2022, we sold a majority interest in the brand to a third party, retaining a 30% noncontrolling interest in the brand. In April 2025, our interest in the brand was reduced to 17.5% due to contractual arrangements with the third-party buyer.
Removed
With G-III’s successful launch of Halston apparel in the third quarter of 2024, and their anticipated launch of Halston footwear and handbags in Spring 2025, we expect that the business and corresponding royalty revenues to Xcel will increase in 2025 and beyond. ● The master license agreement for our Judith Ripka Brand is with America’s Collectible Network, Inc. d/b/a JTV (“JTV”) and covers both interactive television and e-commerce operations.
Removed
Since JTV’s successful launch of the Ripka Brand on JTV’s television channel in October 2023, the Ripka Brand has become one of the core brands on the JTV network, and has shown continual quarterly sequential and year-over-year revenue growth. ● The C Wonder Brand launched on HSN in mid-2023, performed well in its launch year, and has continued to show strong performance throughout 2024.
Removed
While our overall long-term business strategy is not dependent on such acquisitions, we carefully consider potential acquisitions as a means to leverage our infrastructure and expertise and accelerate our growth. Finally, in December 2023, Xcel acquired a noncontrolling equity interest in ORME, which is a brand new short-form video social commerce marketplace that launched in April 2024.
Removed
While we do not consolidate ORME’s financial results of operations with our own (given our minority noncontrolling position in the company) and do not anticipate receiving regular dividends or other distributions from ORME in the near future, we believe that ORME has significant growth potential and will add significant value to Xcel, both through our equity interest in ORME as well as our ability to leverage ORME in order to grow additional direct-to-consumer brands that would perform well in social commerce pursuant to our aforementioned brand development and acquisition strategies.
Removed
Effective January 1, 2022, the agreement entered a sell-off period, under which Qurate was allowed to continue to license the Ripka brand on a non-exclusive basis for as long as necessary to sell off any of its remaining inventory.
Removed
The sell-off period ended in 2023. ● On May 31, 2022, in connection with our sale of a majority interest in the Isaac Mizrahi brand to a third party, the agreement with Qurate related to the IsaacMizrahiLIVE brand was assigned to IM Topco, LLC.
Removed
Under the Qurate Agreements, Qurate is obligated to make payments to us on a quarterly basis, based upon the net retail sales of the specified branded products.
Removed
We are in discussions with other potential licensees and strategic partners to license and/or co-brand our brand portfolio for additional categories.
Removed
In certain cases, we have engaged licensing agents to assist in the procurement of such licenses for which we or our licensees pay such agents’ fees based upon a percentage of the net sales of licensed products by such licensees, or a percentage of the royalty payments that we receive from such licensees.
Removed
While many of the new and proposed licensing agreements will likely require us to provide seasonal design services, most of our new and prospective licensing partners have their own design staff, and we therefore expect low incremental overhead costs related to expanding our licensing business.
Removed
We manage and have a 50% ownership interest in the brands and trademarks of the Longaberger brand through our business venture with Hilco Global. We also have a 17.5% ownership interest in IM Topco, which owns the Mizrahi brands, including the trademarks and brands Isaac Mizrahi, Isaac Mizrahi New York, IMNYC Isaac Mizrahi, and IsaacMizrahiLIVE.
Removed
None of our employees are represented by a labor union.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

89 edited+11 added−39 removed166 unchanged
Biggest changeThe loans outstanding after giving effect to this amendment and the application of the proceeds of the additional Term Loan B are as follows: (1) Term Loan A in the amount of $2.45 million, (2) Term Loan B in the amount of $9.12 million, and (3) Delayed Draw Term Loan in the amount of $2.05 million. ​ These term loans are guaranteed by certain direct and indirect subsidiaries of the Company, and are secured by all of the assets of the Company and such subsidiaries.
Biggest changeThese term loans are guaranteed by certain direct and indirect subsidiaries of the Company, and are secured by all of the assets of the Company and such subsidiaries. 13 Table of Contents Principal and accrued and unpaid interest on Term Loan A is payable on the maturity date of September 20, 2027 and principal and accrued and unpaid interest on the Term Loan B is payable on the maturity date of December 12, 2028. ​ On April 13, 2026, we issued senior secured notes in a principal amount of $3.01 million (the “Senior Notes”), with a maturity date of April 13, 2027.
Accordingly, the accompanying consolidated financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and calculations of liabilities that might be necessary should be Company be unable to continue as a going concern.
Accordingly, the accompanying consolidated financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and calculations of liabilities that might be necessary should the Company be unable to continue as a going concern.
Because we are dependent on these agreements for a significant portion of our revenues, if Qurate or G-III were to have financial difficulties, or if Qurate and/or G-III decide not to renew or extend their existing agreements with us, our revenue and cash flows could be reduced substantially.
Because we are dependent on these agreements for a significant portion of our revenues, if Qurate or G-III were to have financial difficulties, and/or if Qurate or G-III decide not to renew or extend their existing agreements with us, our revenue and cash flows could be reduced substantially.
Congestion at ports of loading and ports of entry caused significant delays in deliveries and changes to the itineraries of steamship carriers. Truck driver shortages, shortages of truck equipment and the inability of ports to provide reliable pick up times, also negatively impacted our and our licensees’ ability to timely receive goods in the past.
Congestion at ports of loading and ports of entry caused significant delays in deliveries and changes to the itineraries of steamship carriers. Truck driver shortages, shortages of truck equipment, and the inability of ports to provide reliable pick up times, also negatively impacted our licensees’ ability to timely receive goods in the past.
If we cannot adequately obtain and maintain the effectiveness of our internal control over financial reporting, we may be subject to sanctions or investigation by regulatory authorities, such as the SEC. Any such action could adversely affect our financial results and the market price of our common stock.
If we cannot adequately maintain the effectiveness of our internal control over financial reporting, we may be subject to sanctions or investigation by regulatory authorities, such as the SEC. Any such action could adversely affect our financial results and the market price of our common stock.
Our ability to compete effectively and to manage future growth, if any, will depend on the sufficiency and adequacy of our current resources and infrastructure and our ability to continue to identify, attract and retain personnel to manage our brands and integrate any brands we may acquire into our operations.
Our ability to compete effectively and to manage future growth, if any, will depend on the sufficiency and adequacy of our current resources and our ability to continue to identify, attract, and retain personnel to manage our brands and integrate any brands we may acquire into our operations.
These risks include, among others: ● unanticipated costs associated with the target acquisition, joint venture, or collaboration, or its integration with our company; 20 Table of Contents ● our ability to identify or consummate additional quality business opportunities, including potential licenses and new product lines and markets; ● negative effects on reported results of operations from acquisition related charges and costs, and amortization of acquired intangibles; ● diversion of management’s attention from other business concerns; ● the challenges of maintaining focus on, and continuing to execute, core strategies and business plans as our brand and license portfolio grows and becomes more diversified; ● adverse effects on existing licensing and other relationships; ● potential difficulties associated with the retention of key employees, and difficulties, delays and unanticipated costs associated with the assimilation of personnel, operations, systems and cultures, which may be retained by us in connection with or as a result of our acquisitions; ● risks of entering new domestic and international markets (whether it be with respect to new licensed product categories or new licensed product distribution channels) or markets in which we have limited prior experience; and ● increased concentration in our revenues with one or more customers in the event that the brand has distribution channels in which we currently distribute products under one or more of our brands.
These risks include, among others: ● unanticipated costs associated with the target acquisition or collaboration, or its integration with our company; ● our ability to identify or consummate additional quality business opportunities, including potential licenses and new product lines and markets; ● negative effects on reported results of operations from acquisition related charges and costs, and amortization of acquired intangibles; ● diversion of management’s attention from other business concerns; ● the challenges of maintaining focus on, and continuing to execute, core strategies and business plans as our brand and license portfolio grows and becomes more diversified; ● adverse effects on existing licensing and other relationships; ● potential difficulties associated with the retention of key employees, and difficulties, delays, and unanticipated costs associated with the assimilation of personnel, operations, systems, and cultures, which may be retained by us in connection with or as a result of our acquisitions; ● risks of entering new domestic and international markets (whether it be with respect to new licensed product categories or new licensed product distribution channels) or markets in which we have limited prior experience; and 18 Table of Contents ● increased concentration in our revenues with one or more customers in the event that the brand has distribution channels in which we currently distribute products under one or more of our brands.
Although the licensing agreements for our brands typically require the advance payment to us of a portion of the licensing fees and in many cases provide for guaranteed minimum royalty payments to us, the failure of our licensees to satisfy their obligations under these agreements or their inability to operate successfully or at all, could result in their breach and/or the early termination of such agreements, the non-renewal of such agreements, or our decision to amend such agreements to reduce the guaranteed minimums or sales royalties due thereunder, thereby eliminating some or all of that stream of revenue.
Although the licensing agreements for our brands often require the advance payment to us of a portion of the licensing fees and in many cases provide for guaranteed minimum royalty payments to us, the failure of our licensees to satisfy their obligations under these agreements or their inability to operate successfully or at all, could result in their breach and/or the early termination of such agreements, the non-renewal of such agreements, or our decision to amend such agreements to reduce the guaranteed minimums or sales royalties due thereunder, thereby eliminating some or all of that stream of revenue.
Our continued success is largely dependent upon his continued efforts and those of our other key executives. Although we entered into an employment agreement with Mr.
Our continued success is largely dependent upon his continued efforts and those of our other key executives. Although we have entered into an employment agreement with Mr.
Acquiring additional intellectual property could also have a significant effect on our financial position and could cause substantial fluctuations in our quarterly and yearly operating results. Acquisitions and joint ventures could result in the recording of significant goodwill and intangible assets on our financial statements, the amortization or impairment of which would reduce our reported earnings in subsequent years.
Acquiring additional intellectual property could also have a significant effect on our financial position and could cause substantial fluctuations in our quarterly and yearly operating results. Acquisitions could result in the recording of significant goodwill and intangible assets on our financial statements, the amortization or impairment of which would reduce our reported earnings in subsequent years.
Although we will seek to temper our acquisition, joint venture, and collaboration risks by following guidelines relating to purchase price and valuation, projected returns, existing strength of the brand, its diversification benefits to us, its potential licensing scale and creditworthiness of licensee base, acquisitions, joint ventures, and collaborations, whether they be of additional intellectual property assets or of the companies that own them, entail numerous risks, any of which could detrimentally affect our reputation, our results of operations, and/or the value of our common stock.
Although we will seek to temper our acquisition and collaboration risks by following guidelines relating to purchase price and valuation, projected returns, existing strength of the brand, its diversification benefits to us, its potential licensing scale and creditworthiness of licensee base, acquisitions and collaborations, whether they be of additional intellectual property assets or of the companies that own them, entail numerous risks, any of which could detrimentally affect our reputation, our results of operations, and/or the value of our common stock.
If we fail to manage our expected future growth, our business and operating results could be materially harmed. We expect to achieve growth in our existing brands and brands we may develop independently or through collaborations or acquire through expansion of our licensing activities and social media e-commerce platforms, including ORME.
If we fail to manage our expected future growth, our business and operating results could be materially harmed. We expect to achieve growth in our existing brands and brands we may develop independently or through collaborations or acquire through expansion of our licensing activities and social media e-commerce platforms.
The global pandemic affected the financial health of certain of our customers, and the bankruptcy of certain other customers; as a result, we may be required to make additional adjustments to our allowances for credit losses in future periods, which would increase our operating expenses and negatively impact our operating results. ​ In addition, the effects of the COVID-19 pandemic on the shipping industry negatively impacted our licensees’ ability to import products in a manner that allowed for timely delivery to customers.
The global pandemic affected the financial health of certain of our customers, and the bankruptcy of certain other customers; as a 25 Table of Contents result, we may be required to make additional adjustments to our allowances for credit losses in future periods, which would increase our operating expenses and negatively impact our operating results. ​ In addition, the effects of the COVID-19 pandemic on the shipping industry negatively impacted our licensees’ ability to import products in a manner that allowed for timely delivery to customers.
If we or our joint ventures are unable to cost-effectively use social media platforms as marketing tools or if the social media platforms we or our joint ventures use change their policies or algorithms, we or our joint ventures may not be able to fully optimize such platforms, and our and their ability to maintain and acquire customers and our financial condition may suffer.
If we are unable to cost-effectively use social media platforms as marketing tools or if the social media platforms we use change their policies or algorithms, we may not be able to fully optimize such platforms, and our ability to maintain and acquire customers and our financial condition may suffer.
The information and data processed and stored in our technology systems, and those of our licensees, joint ventures, and other third parties on whom we depend to operate our business, may be vulnerable to loss, damage, denial-of-service, unauthorized access, or misappropriation.
The information and data processed and stored in our technology systems, and those of our licensees and other third parties on whom we depend to operate our business, may be vulnerable to loss, damage, denial-of-service, unauthorized access, or misappropriation.
If we are unable to identify and successfully acquire additional trademarks or enter into joint ventures or collaborations for brands, our growth may be limited and, even if additional trademarks are acquired or joint ventures and collaborations are formed, we may not realize anticipated benefits due to integration or licensing difficulties.
If we are unable to identify and successfully acquire additional trademarks or enter into collaborations for brands, our growth may be limited and, even if additional trademarks are acquired or collaborations are formed, we may not realize anticipated benefits due to integration or licensing difficulties.
These additional sales practice and disclosure requirements could impede the sale of our common stock even if and when our common stock becomes listed on the NASDAQ Capital Market. In addition, the liquidity for our common stock may decrease, with a corresponding decrease in the price of our common stock.
These additional sales practices and disclosure requirements could impede the sale of our common stock even if and when our common stock becomes listed on the NASDAQ Capital Market. In addition, the liquidity for our common stock may decrease, with a corresponding decrease in the price of our common stock.
Continued market acceptance of our brands, our joint ventures’ brands, and our licensees’ products, as well as market acceptance of any future products bearing any future brands we may acquire, is subject to a high degree of uncertainty and constantly changing consumer tastes, preferences, and purchasing patterns.
Continued market acceptance of our brands and our licensees’ products, as well as market acceptance of any future products bearing any future brands we may acquire, is subject to a high degree of uncertainty and constantly changing consumer tastes, preferences, and purchasing patterns.
These agreements, among other things, require us to indemnify each director and executive officer for certain expenses, including attorneys’ fees, judgments, fines and settlement amounts, incurred by any such person in any action or proceeding, including any action by us or in our right, arising out of the person’s services as one of our directors or executive officers.
These agreements, among other things, require us to indemnify each director and executive officer for certain expenses, including attorneys’ fees, judgments, fines and settlement amounts, incurred by 30 Table of Contents any such person in any action or proceeding, including any action by us or in our right, arising out of the person’s services as one of our directors or executive officers.
Moreover, we could incur significant expenses or disruptions of our operations in connection with system failures or breaches. In addition, 30 Table of Contents sophisticated hardware and operating system software and applications that we procure from third parties may contain defects in design or manufacture, including “bugs” and other problems that could unexpectedly interfere with the operation of our systems.
Moreover, we could incur significant expenses or disruptions of our operations in connection with system failures or breaches. In addition, sophisticated hardware and operating system software and applications that we procure from third parties may contain defects in design or manufacture, including “bugs” and other problems that could unexpectedly interfere with the operation of our systems.
Competition is based on many factors including, without limitation, the following: ● establishing and maintaining favorable brand recognition; ● developing products that appeal to consumers; ● pricing products appropriately; ● determining and maintaining product quality; ● obtaining access to sufficient floor space in retail locations; ● providing appropriate services and support to retailers; ● maintaining and growing market share; ● developing and maintaining a competitive e-commerce site; ● hiring and retaining key employees; and ● protecting intellectual property.
Competition is based on many factors including, without limitation, the following: ● establishing and maintaining favorable brand recognition; ● developing products that appeal to consumers; ● pricing products appropriately; ● determining and maintaining product quality; ● obtaining access to sufficient floor space in retail locations; ● providing appropriate services and support to retailers; ● maintaining and growing market share; ● developing and maintaining a competitive e-commerce site; 19 Table of Contents ● hiring and retaining key employees; and ● protecting intellectual property.
Any write-down of intangible assets resulting from future periodic evaluations would, as applicable, either decrease our net income or increase our net loss and those decreases or increases could be material. Changes in effective tax rates or adverse outcomes resulting from examination of our income or other tax returns could adversely affect our results.
Any write-down of intangible assets resulting from future periodic evaluations would, as applicable, either decrease our net income or increase our net loss and those decreases or increases could be material. 27 Table of Contents Changes in effective tax rates or adverse outcomes resulting from examination of our income or other tax returns could adversely affect our results.
Our auditor also included an explanatory paragraph in its report on our financial statements as of and for the year ended December 31, 2024 with respect to this uncertainty.
Our auditor also included an explanatory paragraph in its report on our financial statements as of and for the year ended December 31, 2025 with respect to this uncertainty.
No assurance can be given that our stock will not be subject to these “penny stock” rules in the future. Investors should be aware that, according to Commission Release No. 34-29093, the market for “penny stocks” has suffered in recent years from patterns of fraud and abuse.
No assurance can be given that our stock will not be subject to these “penny stock” rules in the future. 23 Table of Contents Investors should be aware that, according to Commission Release No. 34-29093, the market for “penny stocks” has suffered in recent years from patterns of fraud and abuse.
It is not possible to prevent such behavior, and the precautions we and our joint ventures take to detect this activity may not be effective in all cases. Our and our joint ventures’ target consumers often value readily available information and often act on such information without further investigation and without regard to its accuracy.
It is not possible to prevent such behavior, and the precautions we take to detect this activity may not be effective in all cases. Our target consumers often value readily available information and often act on such information without further investigation and without regard to its accuracy.
Such factors as well as another shift towards recessionary conditions have in the past, and could in the future, devalue our brands, which could result in an impairment in its carrying value, which could be material, create downward pricing pressure on the products carrying our brands, and adversely impact our sales volumes and overall profitability.
Such factors as well as another shift towards recessionary conditions have, in the past, and could in the future, devalue our brands, which could result in an impairment in its carrying value, which could be material, create downward pricing pressure on the products carrying our brands, and adversely impact our revenues and overall profitability.
Because of the intense competition within our existing and potential wholesale licensees’ markets and the strength of some of their competitors, we and our licensees may not be able to continue to compete successfully.
Because of the intense competition within our existing and potential licensees’ markets and the strength of some of their competitors, our licensees may not be able to continue to compete successfully.
The success of our company, however, will remain largely dependent on our ability to build and maintain broad market acceptance of our brands, co-developed brands, and joint venture brands to contract with and retain key licensees and on our licensees’ and join venture partners’ ability to accurately predict upcoming fashion and design trends within customer bases and fulfill the product requirements of retail channels within the global marketplace.
The success of our company, however, will remain largely dependent on our ability to build and maintain broad market acceptance of our brands and co-developed brands to contract with and retain key licensees and on our licensees’ ability to accurately predict upcoming fashion and design trends within customer bases and fulfill the product requirements of retail channels within the global marketplace.
Such failure could also cause the devaluation of our trademarks, which are our primary assets and the primary assets of our joint ventures, making it more difficult for us or our joint ventures to renew our current licenses upon their expiration or enter into new or additional licenses for such trademarks.
Such failure could also cause the devaluation of our trademarks, which are our primary assets, making it more difficult for us to renew our current licenses upon their expiration or enter into new or additional licenses for such trademarks.
Our growth may be limited by a number of factors including increased competition among branded products at brick-and-mortar, internet and interactive retailers, decreased airtime on QVC, HSN, and JTV, competition for retail licenses and brand acquisitions, joint ventures and collaborations, and insufficient capitalization for future transactions. We are dependent upon our Chief Executive Officer and other key executives.
Our growth may be limited by a number of factors including increased competition among branded products at brick-and-mortar, internet, and interactive retailers, decreased airtime on QVC, HSN, and JTV, competition for retail licenses, brand acquisitions, and collaborations, and insufficient capitalization for future transactions. 17 Table of Contents We are dependent upon our Chief Executive Officer and other key executives.
Our audited financial statements for the fiscal year ended December 31, 2024 were prepared under the assumption that we will continue as a going concern; however, we have incurred significant losses over the past several years and have used a significant amount of cash in operating activities.
Our audited financial statements for the fiscal year ended December 31, 2025 have been prepared under the assumption that we will continue as a going concern; however, we have incurred significant losses over the past several years and have used a significant amount of cash in operating activities.
Any such disclosures, including those under state data breach notification laws, can be costly, and the disclosures we make to comply with, or the failure to comply with, such requirements could lead to adverse consequences. ​ Changes in laws could make conducting our business more expensive or otherwise change the way we do business.
Any such disclosures, including those under state data breach notification laws, can be costly, and the disclosures we make to comply with, or the failure to comply with, such requirements could lead to adverse consequences. ​ 29 Table of Contents Changes in laws could make conducting our business more expensive or otherwise change the way we do business.
In addition, our credit facility limits the amount of cash dividends we may pay while amounts under the credit facility are outstanding. 27 Table of Contents Provisions of our corporate charter documents could delay or prevent change of control.
In addition, our credit facility limits the amount of cash dividends we may pay while amounts under the credit facility are outstanding. Provisions of our corporate charter documents could delay or prevent change of control.
Further, these cybersecurity incidents can lead to the public disclosure of personal information (including sensitive personal information) of our employees, customers, and others and result in demands for ransom or 31 Table of Contents other forms of blackmail.
Further, these cybersecurity incidents can lead to the public disclosure of personal information (including sensitive personal information) of our employees, customers, and others and result in demands for ransom or other forms of blackmail.
No assurance can be given with respect to the timing, likelihood or financial or business effect of any possible transaction. Moreover, our ability to grow through the acquisition of additional intellectual property, joint ventures and collaborations will also depend on the availability of capital to complete the necessary acquisition arrangements.
No assurance can be given with respect to the timing, likelihood, or financial or business effect of any possible transaction. Moreover, our ability to grow through the acquisition of additional intellectual property will also depend on the availability of capital to complete the necessary acquisition arrangements.
Consumer spending is impacted by a number of factors which are beyond our control, including actual and perceived economic conditions affecting disposable consumer income (such as unemployment, wages, energy costs and consumer debt levels), customer traffic within shopping and selling environments, business conditions, interest rates and availability of credit and tax rates in the general economy and in the international, regional and local markets in which our products are sold and the impact of natural disasters and pandemics and disease outbreaks.
Consumer spending is impacted by a number of factors which are beyond our control, including actual and perceived economic conditions affecting disposable consumer income (such as unemployment, wages, energy costs, and consumer debt levels), customer traffic within shopping and selling environments, business conditions, interest rates, tax rates, and the availability of credit in the general economy and in the international, regional, and local markets in which our products are sold.
If prolonged, such extreme or unseasonable weather conditions could adversely affect our business, financial condition, and results of operations. Our trademarks and other intangible assets are subject to impairment charges under accounting guidelines. Our intangible assets including our trademarks had a net carrying value of $34.8 million as of December 31, 2024 and represent a substantial portion of our assets.
If prolonged, such extreme or unseasonable weather conditions could adversely affect our business, financial condition, and results of operations. Our trademarks and other intangible assets are subject to impairment charges under accounting guidelines. Our intangible assets including our trademarks had a net carrying value of $31.2 million as of December 31, 2025 and represent a substantial portion of our assets.
As existing e-commerce and social media platforms continue to rapidly evolve and new platforms develop, we and our joint ventures must continue to maintain a presence on these platforms and establish presences on new or emerging popular social media platforms.
As existing e-commerce and social media platforms continue to rapidly evolve and new platforms develop, we must continue to maintain a presence on these platforms and establish presences on new or emerging popular social media platforms.
We are also subject to general risks, which include, but are not limited to, risks related to: ● a pandemic or outbreak of disease or similar public health threat, or fear of such an event; ● a decline in general economic conditions, international trade, or consumer spending levels; ● extreme or unseasonable weather conditions; ● potential impairment of our trademarks and other intangible assets under accounting guidelines; ● changes in our effective tax rates or adverse outcomes resulting from examination of our tax returns; ● maintenance and security of our information technology systems; ● changes in laws and regulations; ● maintaining an effective system of internal control; and ● limitations on liabilities of our directors and executive officers.
We are also subject to general risks, which include, but are not limited to, risks related to: ● a pandemic or outbreak of disease or similar public health threat, or fear of such an event; ● a decline in general economic conditions, international trade, or consumer spending levels; ● extreme or unseasonable weather conditions; ● potential impairment of our trademarks and other intangible assets under accounting guidelines; ● changes in our effective tax rates or adverse outcomes resulting from examination of our tax returns; ● maintenance and security of our information technology systems; ● changes in laws and regulations; ● maintaining an effective system of internal control; and ● limitations on liabilities of our directors and executive officers. 12 Table of Contents Risks Related to Our Business We have a limited amount of cash to grow our operations.
While we are focused on growing our existing brands, we intend to selectively seek to acquire additional intellectual property, either directly or through the formation of joint ventures or collaborations. However, as our competitors continue to pursue a brand management model, acquisitions, joint ventures, and collaborations may become more expensive and suitable candidates could become more difficult to find.
While we are focused on growing our existing brands, we intend to selectively seek to acquire additional intellectual property, either directly or through collaborations. However, as our competitors continue to pursue a brand management model, acquisitions and collaborations may become more expensive and suitable candidates could become more difficult to find.
A trade war, other governmental action related to tariffs or trade agreements, changes in U.S. social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories and countries where the products of our licensees are manufactured may have a negative impact on the wholesale sales of our licensees and retail sales of our retail partners, and any resulting negative sentiments towards the U.S. as a result of such changes, could have a material adverse effect on license revenues, our business, financial condition, results of operations, and cash flows. 29 Table of Contents Extreme or unseasonable weather conditions could adversely affect our business.
A trade war, other governmental action related to tariffs or trade agreements, changes in U.S. social, political, regulatory and economic conditions or in laws and policies governing foreign trade, manufacturing, development and investment in the territories and countries where the products of our licensees are manufactured may have a negative impact on the wholesale sales of our licensees and retail sales of our retail partners, and any resulting negative sentiments towards the U.S. as a result of such changes, could have a material adverse effect on license revenues, our business, financial condition, results of operations, and cash flows.
Macroeconomic conditions and international trade conditions could adversely impact our business and results of operations. Poor economic and market conditions, including a potential recession, may negatively impact market sentiment, decreasing the demand for apparel, footwear, accessories, fine jewelry, home goods, and other consumer products, which would adversely affect our operating income and results of operations.
Poor economic and market conditions, including a potential recession, may negatively impact market sentiment, decreasing the demand for apparel, footwear, accessories, fine jewelry, home goods, and other consumer products, which would adversely affect our operating income and results of operations.
Negative commentary regarding us, our joint ventures or our or their products or influencers and other third parties who are affiliated with us or our joint ventures may also be posted on social media platforms and may be adverse to our or our joint ventures’ reputation or business.
Negative commentary regarding us or our products or influencers and other third parties who are affiliated with us may also be posted on social media platforms and may be adverse to our reputation or business.
The harm may be immediate, without affording us and our joint ventures an opportunity for redress or correction. If we are unable to anticipate and respond to changing customer preferences and shifts in fashion and industry trends in a timely manner, our business, financial condition, and operating results could be harmed.
The harm may be immediate, without affording us an opportunity for redress or correction. 16 Table of Contents If we are unable to anticipate and respond to changing customer preferences and shifts in fashion and industry trends in a timely manner, our business, financial condition, and operating results could be harmed.
Influencers with whom we or our joint ventures maintain relationships could engage in behavior or use their platforms to communicate directly with our customers in a manner that reflects poorly on our or our joint ventures’ brand and may be attributed to us or our joint ventures or otherwise adversely affect us or our joint ventures.
Influencers with whom we maintain relationships could engage in behavior or use their platforms to communicate directly with our customers in a manner that reflects poorly on our brands and may be attributed to us or otherwise adversely affect us.
A breach of any of these agreements could also result in Qurate seeking monetary damages, seeking an injunction against us and our other licensees, reducing the programming time allocated to our brands, and/or terminating the respective agreement, which could have a material adverse effect on our net income and cash flows. We conduct certain of our operations through joint ventures.
A breach of any of these agreements could also result in Qurate seeking monetary damages, seeking an injunction against us and our other licensees, reducing the programming time allocated to our brands, and/or terminating the respective agreement, which could have a material adverse effect on our net income and cash flows.
We use and our joint ventures may use third-party social media platforms as, among other things, marketing tools. We also maintain, and our joint ventures may maintain, relationships with many social media influencers and engage in sponsorship initiatives.
We use third-party social media platforms as, among other things, marketing tools. We also maintain relationships with many social media influencers and engage in sponsorship initiatives.
Extreme weather events and changes in weather patterns can influence customer trends and shopping habits. Extended periods of unseasonably warm temperatures during the fall and winter seasons, or cool weather during the summer season, may diminish demand for our seasonal merchandise.
Extreme or unseasonable weather conditions could adversely affect our business. Extreme weather events and changes in weather patterns can influence customer trends and shopping habits. Extended periods of unseasonably warm temperatures during the fall and winter seasons, or cool weather during the summer season, may diminish demand for our seasonal merchandise.
As a result of the magnitude of our licensees’ foreign sourcing, our business is subject to the following risks: ● political and economic instability in countries or regions, especially Asia, including heightened terrorism and other security concerns, which could subject imported or exported goods to additional or more frequent inspections, leading to delays win deliveries or impoundment of goods; ● imposition of regulations, quotas and other trade restrictions relating to imports, including quotas imposed by bilateral textile agreements between the U.S. and foreign countries; ● currency exchange rates; ● imposition of increased duties, tariffs, taxes, and other charges on imports; ● pandemics and disease outbreaks such as COVID-19; ● labor union strikes at ports through which our products enter the U.S.; ● labor shortages in countries where contractors and suppliers are located; ● restrictions on the transfer of funds to or from foreign countries; ● disease epidemics and health-related concerns, which could result in closed factories, reduced workforces, scarcity of raw materials and scrutiny or embargoing of goods produced in infected areas; ● the migration and development of manufacturing contractors, which could affect where our brands are or are planned to be produced; ● increases in the costs of fuel, travel and transportation; and 23 Table of Contents ● violations by foreign contractors of labor and wage standards and resulting adverse publicity.
The failure to make timely deliveries may cause their customers to cancel orders, refuse to accept deliveries or demand reduced prices, any of which could reduce our licensing royalties, which could have a material adverse effect on us. 20 Table of Contents As a result of the magnitude of our licensees’ foreign sourcing, our business is subject to the following risks: ● political and economic instability in countries or regions, especially Asia, including heightened terrorism and other security concerns, which could subject imported or exported goods to additional or more frequent inspections, leading to delays win deliveries or impoundment of goods; ● imposition of regulations, quotas and other trade restrictions relating to imports, including quotas imposed by bilateral textile agreements between the U.S. and foreign countries; ● currency exchange rates; ● imposition of increased duties, tariffs, taxes, and other charges on imports; ● pandemics and disease outbreaks such as COVID-19; ● labor union strikes at ports through which our products enter the U.S.; ● labor shortages in countries where contractors and suppliers are located; ● restrictions on the transfer of funds to or from foreign countries; ● disease epidemics and health-related concerns, which could result in closed factories, reduced workforces, scarcity of raw materials and scrutiny or embargoing of goods produced in infected areas; ● the migration and development of manufacturing contractors, which could affect where our brands are or are planned to be produced; ● increases in the costs of fuel, travel and transportation; and ● violations by foreign contractors of labor and wage standards and resulting adverse publicity.
Our cash flow would also be significantly impacted if there were significant delays in our collection of receivables from these licensees. Additionally, we have limited control over the programming that Qurate devotes to our brands or its promotional sales with our brands (such as “Today’s Special Value” sales).
Our cash flow would also be significantly impacted if there were significant 14 Table of Contents delays in our collection of receivables from these licensees. Additionally, we have limited control over the programming that Qurate devotes to our brands or its promotional sales with our brands.
We continue to seek new opportunities and international expansion through interactive television and licensing arrangements, 19 Table of Contents as well as joint ventures and collaborations.
We continue to seek new opportunities and international expansion through interactive television and licensing arrangements, as well as joint ventures and collaborations.
This market volatility could reduce the market price of the common stock, regardless of our 26 Table of Contents operating performance.
This market volatility could reduce the market price of the common stock, regardless of our operating performance.
In addition, if such devaluation of our trademarks were to occur, a material impairment in the carrying value of one or more of our trademarks, which had an aggregate carrying value of $34.8 million as of December 31, 2024, could also occur and be charged as an expense to our operating results.
In addition, if such devaluation of our trademarks were to occur, a material impairment in the carrying value of one or more of our trademarks, which had an 15 Table of Contents aggregate carrying value of $31.2 million as of December 31, 2025, could also occur and be charged as an expense to our operating results.
Negative claims or publicity regarding Xcel, IM Topco, LLC, our brand co-developers, any future joint ventures, our or their brands, or products could adversely affect our reputation and sales regardless of whether such claims are accurate. Social media, which accelerates the dissemination of information, can increase the challenges of responding to negative claims.
Negative claims or publicity regarding Xcel, our brand co-developers, our brands, or our products could adversely affect our reputation and sales regardless of whether such claims are accurate. Social media, which accelerates the dissemination of information, can increase the challenges of responding to negative claims.
Although certain of our licensees guarantee minimum net sales and minimum royalties to us, some of our licensees are not yet selling licensed products or currently have limited distribution of licensed products, and a failure of our brands or of our joint venture brands or of products bearing our brands or our joint venture brands to achieve or maintain broad market acceptance could cause a reduction of our licensing revenues, diminish the value of and generally affect the operating results of our joint ventures, and could further cause existing licensees not to renew their agreements.
Although certain of our licensees guarantee minimum net sales and minimum royalties to us, some of our licensees are not yet selling licensed products or currently have limited distribution of licensed products, and a failure of our brands or of products bearing our brands to achieve or maintain broad market acceptance could cause a reduction of our licensing revenues, and could further cause existing licensees not to renew their agreements.
Tax years that remain open for assessment for federal and state purposes include the years ended December 31, 2020 through December 31, 2024.
Tax years that remain open for assessment for federal and state purposes include the years ended December 31, 2021 through December 31, 2025.
During the years ended December 31, 2024 and 2023, Qurate accounted for approximately 44% and 34%, respectively, of our total net revenue, while the Halston Master License represented approximately 31% and 9% of our total net revenue, respectively.
During the years ended December 31, 2025 and 2024, Qurate accounted for approximately 20% and 44%, respectively, of our total net revenue, while the Halston Master License represented approximately 52% and 31% of our total net revenue, respectively.
While we generally apply for trademarks in most countries where we license or intend to license our trademarks, we may not accurately predict all of the countries where trademark protection will ultimately be desirable.
Consequently, in certain foreign jurisdictions, we have elected or may elect not to apply for trademark registrations. While we generally apply for trademarks in most countries where we license or intend to license our trademarks, we may not accurately predict all of the countries where trademark protection will ultimately be desirable.
Summary of Risk Factors Our business is subject to a number of risks, which include, but are not limited to, risks related to: ● our debt obligations and our limited amount of cash; ● material weaknesses in our internal controls over financial reporting; ● our concentration of revenue with a limited number of licensees; ● restrictions related to certain key licensing agreements; ● conducting operations through joint ventures and our dependence on the joint ventures; ● the operational performance and/or strategic initiatives of our licensees and retail partners; ● continued market acceptance of our brands and products; ● the use of social media and influencers to market brands and products; ● changing consumer preferences and shifting industry trends; ● execution of our growth strategy, including the acquisition of new brands; ● our dependency on our Chief Executive Officer and other key executives; ● intense competition in the apparel, fashion, and jewelry industries, and within our licensees’ markets; and 12 Table of Contents ● protection of our trademarks and other intellectual property rights.
Summary of Risk Factors Our business is subject to a number of risks, which include, but are not limited to, risks related to: ● our debt obligations and our limited amount of cash; ● our concentration of revenue with a limited number of licensees; ● restrictions related to certain key licensing agreements; ● the operational performance and/or strategic initiatives of our licensees; 11 Table of Contents ● continued market acceptance of our brands and products; ● the use of social media and influencers to market brands and products; ● execution of our growth strategy, including the acquisition of new brands; ● our dependency on our Chief Executive Officer and other key executives; ● intense competition in the apparel, fashion, and jewelry industries, and within our licensees’ markets; and ● protection of our trademarks and other intellectual property rights.
Our business is dependent on continued market acceptance of our brands, our joint venture brands, and any future brands we may acquire directly or through a joint venture, and the products of our licensees.
Our business is dependent on continued market acceptance of our brands and any future brands we may acquire, and the products of our licensees.
Principal on the Term Loan B is payable on the maturity date of December 12, 2028. ​ Our debt obligations: ​ ● could impair our liquidity; ​ ● could make it more difficult for us to satisfy our other obligations; ​ ● require us to dedicate a substantial portion of our cash flow to payments on our debt obligations, which reduces the availability of our cash flow to fund working capital, capital expenditures and other corporate requirements; ​ ● could impede us from obtaining additional financing in the future; ​ ● impose restrictions on us with respect to the use of our available cash, including in connection with future transactions; ​ ● could limit our ability to execute on any potential acquisitions in the future; and ​ ● make us more vulnerable in the event of a downturn in our business prospects and could limit our flexibility to plan for, or react to, changes in our sales and licensing channels. ​ In the event that we fail in the future to make any required payment under the agreements governing our indebtedness or if we fail to comply with the financial and operating covenants contained in those agreements, we would be in default with respect to that indebtedness and the lenders could declare such indebtedness to be immediately due and payable.
The Senior Notes are guaranteed by certain direct and indirect subsidiaries of the Company, and are secured by all of the assets of the Company and such subsidiaries. ​ Our debt obligations: ​ ● could impair our liquidity; ​ ● could make it more difficult for us to satisfy our other obligations; ​ ● require us to dedicate a substantial portion of our cash flow to payments on our debt obligations, which reduces the availability of our cash flow to fund working capital, capital expenditures, and other corporate requirements; ​ ● could impede us from obtaining additional financing in the future; ​ ● impose restrictions on us with respect to the use of our available cash, including in connection with future transactions; ​ ● could limit our ability to execute on any potential acquisitions in the future; and ​ ● make us more vulnerable in the event of a downturn in our business prospects and could limit our flexibility to plan for, or react to, changes in our sales and licensing channels. ​ In the event that we fail in the future to satisfy other obligations under the agreements governing our indebtedness, including satisfying financial covenants, we would be in default with respect to that indebtedness and the lenders could declare such indebtedness to be immediately due and payable.
There can be no assurance that the lenders will amend or grant waivers to the loan agreement to adjust or eliminate covenants or waive our non-compliance or breach of a financial or other covenant in the future. Failure to maintain our listing on Nasdaq would result in a default under our term loan debt agreements, as amended.
We cannot assure you that the lenders will amend or grant waivers to the loan agreements to adjust or eliminate covenants or waive our future non-compliance or breach of a financial or other covenant in the future. Failure to maintain our listing on Nasdaq would also result in a default under our term loan debt agreements.
The proxy holder shall vote in favor of matters recommended or approved by the board of directors. 24 Table of Contents The combined voting power of the common stock ownership of our directors and executive officers was approximately 40% of our voting securities as of April 5, 2025.
The proxy holder shall vote in favor of matters recommended or approved by the board of directors. The combined voting power of the common stock ownership of our directors and executive officers was approximately 30% of our voting securities as of March 3, 2026.
As a result, there is no guarantee that our stockholders will achieve greater returns as a result of any future acquisitions we complete. ​ 21 Table of Contents Intense competition in the apparel, fashion, and jewelry industries could reduce our sales and profitability.
As a result, there is no guarantee that our stockholders will achieve greater returns as a result of any future acquisitions we complete. Intense competition in the apparel, fashion, and jewelry industries could reduce our sales and profitability. As a fashion company, we face intense competition from other domestic and foreign apparel, footwear, accessories, and jewelry manufacturers and retailers.
On April 21, 2025, we entered into an amendment our lenders and FEAC Agent, LLC, pursuant to which the December 12, 2024 loan and security agreement was amended to provide for $1.5 million repayment of the $3.95 million Term Loan A made on December 12, 2024 and an additional Term Loan B in the amount of $5.12 million on April 21, 2025.
On April 21, 2025, we and certain of our direct and indirect subsidiaries entered into an amendment with our lenders and FEAC Agent, LLC, pursuant to which we made a $1.5 million repayment of the Term Loan A made on December 12, 2024 and we borrowed an additional Term Loan B in the amount of $5.12 million.
The risks associated with our business are more acute during periods of economic slowdown or recession. Accordingly, any prolonged economic slowdown or a lengthy or severe recession with respect to either the U.S. or the global economy is likely to have a material adverse effect on our results of operations, financial condition, and business prospects.
Accordingly, any prolonged economic slowdown or a lengthy or severe recession with respect to either the U.S. or the global economy is likely to have a material adverse effect on our results of operations, financial condition, and business prospects. Macroeconomic conditions and international trade conditions could adversely impact our business and results of operations.
We may issue a substantial number of shares of common stock upon exercise of outstanding warrants and options. As of December 31, 2024, we had outstanding warrants and options to purchase 736,349 shares of our common stock with a weighted average exercise price of $15.69.
We may issue a substantial number of shares of common stock upon exercise of outstanding warrants and options. As of December 31, 2025, we had outstanding warrants and options to purchase 4,129,904 shares of our common stock with a weighted average exercise price of $6.41.
Furthermore, as laws and regulations and public opinion rapidly evolve to govern the use of these platforms and devices, the failure by us, our employees, our network of social media influencers, our sponsors or third parties acting at our direction to abide by applicable laws and regulations in the use of these platforms and devices or otherwise could subject us to regulatory investigations, class action lawsuits, liability, fines or other penalties and have a material adverse effect on our business, financial condition and operating results. 18 Table of Contents In addition, an increase in the use of social media for product promotion and marketing may cause an increase in the burden on us and our joint ventures to monitor compliance of such materials, and increase the risk that such materials could contain problematic product or marketing claims in violation of applicable regulations.
Furthermore, as laws and regulations and public opinion rapidly evolve to govern the use of these platforms and devices, the failure by us, our employees, our network of social media influencers, our sponsors, or third parties acting at our direction to abide by applicable laws and regulations in the use of these platforms and devices or otherwise could subject us to regulatory investigations, class action lawsuits, liability, fines, or other penalties and have a material adverse effect on our business, financial condition, and operating results.
On April 8, 2025, we received a letter from the Listing Qualifications Department of Nasdaq confirming that we had regained compliance with the applicable listing rules, and this matter was closed. As of May 2, 2025, the closing price of our common stock was $2.79.
On April 8, 2025, we received a letter from the Listing Qualifications Department of Nasdaq confirming that we had regained compliance with the 22 Table of Contents applicable listing rules, and this matter was closed.
In addition, we depend upon the laws of the countries where our licensees’ products are sold to protect our intellectual property. Intellectual property rights may be unavailable or limited in some countries because standards of registration and ownership vary internationally. Consequently, in certain foreign jurisdictions, we have elected or may elect not to apply for trademark registrations.
In addition, we depend upon the laws of the countries where our licensees’ products are sold to protect our intellectual property. 21 Table of Contents Intellectual property rights may be unavailable or limited in some countries because standards of registration and ownership vary internationally.
We cannot predict whether additional U.S. and foreign customs quotas, duties (including antidumping or countervailing duties), tariffs and any retaliatory counter measures, taxes or other charges or restrictions, requirements as to where raw materials and component parts must be purchased, additional workplace regulations or other restrictions on our imports will be imposed in the future or adversely modified, or what effect such actions would have on our revenues and costs of operations.
These developments, or the perception that they could occur, may have a material adverse effect on global economic conditions and the stability of global financial markets, and may significantly reduce global trade and, in particular, trade between the impacted countries. 26 Table of Contents We cannot predict whether additional U.S. and foreign customs quotas, duties (including antidumping or countervailing duties), tariffs and any retaliatory counter measures, taxes or other charges or restrictions, requirements as to where raw materials and component parts must be purchased, additional workplace regulations or other restrictions on our imports will be imposed in the future or adversely modified, or what effect such actions would have on our revenues and costs of operations.
Furthermore, we do not actually design or manufacture all of the products bearing our marks, and therefore, have less control over such products’ quality and design than a traditional product manufacturer might have.
Furthermore, we do not actually design or manufacture all of the products bearing our marks, and therefore, have less control over such products’ quality and design than a traditional product manufacturer might have. The failure of our licensees to maintain the quality of their products could harm the reputation and marketability of our brands, which would adversely impact our business.
Our licensees may be unable to successfully compete in the markets for their products, and we may not be able to continue to compete successfully with respect to our contractual arrangements. 22 Table of Contents If our competition for licenses increases, or any of our current licensees elect not to renew their licenses or renew on terms less favorable than today, our growth plans could be slowed and our business, financial condition and results of operations would be adversely affected.
If our competition for licenses increases, or any of our current licensees elect not to renew their licenses or renew on terms less favorable than today, our growth plans could be slowed and our business, financial condition and results of operations would be adversely affected.
Since our debt obligations are secured by substantially all our assets, upon a default, our lenders may be able to foreclose on our assets. We have identified material weaknesses in our internal controls over financial reporting.
Since our debt obligations are secured by substantially all our assets, upon a default, our lenders may be able to foreclose on our assets.
As a fashion company, we face intense competition from other domestic and foreign apparel, footwear, accessories, and jewelry manufacturers and retailers. Competition has and may continue to result in pricing pressures, reduced profit margins, lost market share, or failure to grow our market share, any of which could substantially harm our business and results of operations.
Competition has and may continue to result in pricing pressures, reduced profit margins, lost market share, or failure to grow our market share, any of which could substantially harm our business and results of operations.
We may therefore fail to discover or inaccurately assess undisclosed or contingent liabilities, including liabilities for which we may have responsibility as a successor to the seller or the target company. As a successor, we may be responsible for any past or continuing violations of law by the seller or the target company.
As a successor, we may be responsible for any past or continuing violations of law by the seller or the target company.
While these tariffs are currently suspended while negotiations take place for a long-term agreement, there continues to exist significant uncertainty about the future relationship between the U.S. and other countries (including China) with respect to trade policies, treaties and tariffs.
There continues to exist significant uncertainty about the future relationship between the U.S. and other countries with respect to trade policies, treaties and tariffs.
We have dedicated a significant amount of time and resources to comply with this legislation for the years ended December 31, 2024 and 2023, and will continue to do so for future fiscal periods. However, our management has concluded that our internal control over financial reporting was not effective as of December 31, 2024 and 2023 due to material weaknesses.
We have dedicated a significant amount of time and resources to comply with this legislation for the years ended December 31, 2025 and 2024, and will continue to do so for future fiscal periods.
We cannot be certain that our internal 32 Table of Contents controls will become effective or that future material changes to our internal control over financial reporting will be effective.
However, we cannot be certain that our internal controls in place and operating as of December 31, 2025 will continue to be effective or that future material changes to our internal control over financial reporting will be effective.
The COVID-19 pandemic caused a disruption to our business, beginning in March 2020. ​ The impacts of the COVID-19 pandemic (including actions taken by national, state, and local governments in response to COVID-19) negatively impacted the U.S. and global economy, disrupted consumer spending and global supply chains, and created significant volatility and disruption of financial markets.
General Risks A pandemic outbreak of disease or similar public health threat, or fear of such an event, could have a material adverse impact on the Company's business, operating results and financial condition. ​ A pandemic or outbreak of disease or similar public health threat, such as the COVID-19 pandemic, or fear of such an event, could have a material adverse impact on our business, operating results, and financial condition. ​ The impacts of the COVID-19 pandemic (including actions taken by national, state, and local governments in response to COVID-19) negatively impacted the U.S. and global economy, disrupted consumer spending and global supply chains, and created significant volatility and disruption of financial markets.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur Board of Directors has oversight for the most significant risks facing us and for our processes to identify, prioritize, assess, manage, and mitigate those risks. The Board of Directors receives periodic updates on cybersecurity and information technology matters and related risk exposures from management. ​ 33 Table of Contents
Biggest changeOur Board of Directors has oversight for the most significant risks facing us and for our processes to identify, prioritize, assess, manage, and mitigate those risks. The Board of Directors receives periodic updates on cybersecurity and information technology matters and related risk exposures from management. ​

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

9 edited+1 added−5 removed15 unchanged
Biggest changePurchases of equity securities by the issuer and affiliated purchasers The following table provides information with respect to restricted stock purchased and retired by the Company during the year ended December 31, 2024. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Number of Shares ​ ​ ​ ​ ​ ​ ​ of Common Stock ​ ​ Total Number of ​ ​ ​ ​ Purchased as ​ ​ Shares of ​ Average ​ Part of a Publicly ​ ​ Common Stock ​ Price per ​ Announced Period ​ Purchased ​ Share ​ Plan or Program July 1, 2024 to July 31, 2024 (i) 1,344 ​ $ 7.20 — August 1, 2024 to August 31, 2024 (i) ​ 2,760 ​ ​ 7.03 ​ — September 1, 2024 to September 30, 2024 (i) ​ 2,594 ​ ​ 7.48 ​ — October 1, 2024 to October 31, 2024 (i) ​ 2,458 ​ ​ 7.89 ​ — November 1, 2024 to November 30, 2024 (i) ​ 2,824 ​ ​ 6.87 ​ — December 1, 2024 to December 31, 2024 (i) ​ 3,768 ​ ​ 5.15 ​ — Total year ended December 31, 2024 15,748 ​ $ 6.78 — ​ (i) The shares were exchanged from employees in connection with the income tax withholding obligations on behalf of such employees from the receipt of stock awards.
Biggest changePurchases of equity securities by the issuer and affiliated purchasers The following table provides information with respect to restricted stock purchased and retired by the Company during the three months ended December 31, 2025. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Number of Shares ​ ​ ​ ​ ​ ​ ​ of Common Stock ​ ​ Total Number of ​ ​ ​ ​ Purchased as ​ ​ Shares of ​ Average ​ Part of a Publicly ​ ​ Common Stock ​ Price per ​ Announced Period ​ Purchased ​ Share ​ Plan or Program October 1, 2025 to October 31, 2025 (i) ​ 10,859 ​ $ 1.26 ​ — November 1, 2025 to November 30, 2025 (i) ​ — ​ ​ — ​ — December 1, 2025 to December 31, 2025 (i) ​ 14,556 ​ ​ 0.94 ​ — Total year ended December 31, 2025 25,415 ​ $ 1.08 — ​ (i) The shares were exchanged from employees in connection with the income tax withholding obligations on behalf of such employees from the receipt of stock awards.
In addition, non-qualified stock options and other Awards may be granted under the 2021 Plan to any person, including, but not limited to, directors, independent agents, consultants, and attorneys who the Board or the Committee, as the case may be, believes has contributed or will contribute to our success. ● With respect to incentive stock options granted to an eligible employee owning stock possessing more than 10% of the total combined voting power of all classes of our stock or the stock of a parent or subsidiary of our Company immediately before the grant (each, a “10% Stockholder”), such incentive stock option shall not be exercisable more than 5 years from the date of grant. ● The exercise price of a stock option will not be less than the fair market value of the shares underlying the option on the date the option is granted, provided, however, that the exercise price of a stock option granted to a 10% Stockholder may not be less than 110% of such fair market value. ● Restricted stock awards give the recipient the right to receive a specified number of shares of common stock, subject to such terms, conditions and restrictions as the Board or the Committee, as the case may be, deems appropriate.
In addition, non-qualified stock options and other Awards may be granted under the 2021 Plan to any person, including, but not limited to, directors, independent agents, consultants, and attorneys who the Board or the Committee, as the case may be, believes has contributed or will contribute to our success. ● With respect to incentive stock options granted to an eligible employee owning stock possessing more than 10% of the total combined voting power of all classes of our stock or the stock of a parent or subsidiary of our Company immediately before the grant (each, a “10% Stockholder”), such incentive stock option shall not be exercisable more than 5 years from the date of grant. 32 Table of Contents ● The exercise price of a stock option will not be less than the fair market value of the shares underlying the option on the date the option is granted, provided, however, that the exercise price of a stock option granted to a 10% Stockholder may not be less than 110% of such fair market value. ● Restricted stock awards give the recipient the right to receive a specified number of shares of common stock, subject to such terms, conditions and restrictions as the Board or the Committee, as the case may be, deems appropriate.
There were no RSUs outstanding as of December 31, 2024. ● Certain Awards made under the Plan may be granted so that they qualify as “performance-based compensation” (as this term is used in Internal Revenue Code Section 162(m) and the regulations thereunder) and are exempt from the deduction limitation imposed by Code Section 162(m) (these Awards are referred to as “Performance-Based Awards”).
There were no RSUs outstanding as of December 31, 2025. ● Certain Awards made under the Plan may be granted so that they qualify as “performance-based compensation” (as this term is used in Internal Revenue Code Section 162(m) and the regulations thereunder) and are exempt from the deduction limitation imposed by Code Section 162(m) (these Awards are referred to as “Performance-Based Awards”).
The Board or Committee shall determine the eligible persons to whom, and the time or times at which, cash awards will be made, the amount that is subject to the cash award, the circumstances and conditions under which such amount 35 Table of Contents shall be paid, in whole or in part, the time of payment, and all other terms and conditions of the Awards.
The Board or Committee shall determine the eligible persons to whom, and the time or times at which, cash awards will be made, the amount that is subject to the cash award, the circumstances and conditions under which such amount shall be paid, in whole or in part, the time of payment, and all other terms and conditions of the Awards.
Options may be exercised in whole or in part. The exercise price of stock options granted is generally the fair market value of the Company’s common stock on the date of grant. The fair value of each stock option award is estimated using the Black-Scholes option pricing model based on certain assumptions.
Options may be 33 Table of Contents exercised in whole or in part. The exercise price of stock options granted is generally the fair market value of the Company’s common stock on the date of grant. The fair value of each stock option award is estimated using the Black-Scholes option pricing model based on certain assumptions.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock is listed on the NASDAQ Capital Market, under the trading symbol “XELB.” Holders As of December 31, 2024, the number of our stockholders of record was 518 (excluding beneficial owners and any shares held in street name or by nominees).
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock is listed on the NASDAQ Capital Market, under the trading symbol “XELB.” Holders As of December 31, 2025, the number of our stockholders of record was 50 (excluding beneficial owners and any shares held in street name or by nominees).
The following table sets forth information as of December 31, 2024 regarding compensation plans under which our equity securities are authorized for issuance: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Number of Securities ​ ​ Number of Securities ​ ​ ​ ​ Remaining Available for ​ ​ to be Issued Upon ​ Weighted Average ​ Future Issuance Under ​ ​ Exercise of ​ Exercise Price of ​ Equity Compensation Plans ​ ​ Outstanding Options, ​ Outstanding Options, ​ (Excluding Securities ​ ​ Warrants and Rights ​ Warrants and Rights ​ Reflected in Column (a)) Plan Category (a) (b) (c) Equity compensation Plans (1) ​ 472,392 ​ $ 19.01 ​ 279,957 ​ (1) Pursuant to our 2011 and 2021 Equity Incentive Plans.
The following table sets forth information as of December 31, 2025 regarding compensation plans under which our equity securities are authorized for issuance: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Number of Securities ​ ​ Number of Securities ​ ​ ​ ​ Remaining Available for ​ ​ to be Issued Upon ​ Weighted Average ​ Future Issuance Under ​ ​ Exercise of ​ Exercise Price of ​ Equity Compensation Plans ​ ​ Outstanding Options, ​ Outstanding Options, ​ (Excluding Securities ​ ​ Warrants and Rights ​ Warrants and Rights ​ Reflected in Column (a)) Plan Category ​ ​ ​ (a) ​ ​ ​ (b) ​ ​ ​ (c) Equity compensation Plans (1) ​ 977,695 ​ $ 8.69 ​ 191,003 ​ (1) Pursuant to our 2011 and 2021 Equity Incentive Plans.
The stock options may be incentive stock options or non-qualified stock options. 34 Table of Contents ● A total of 400,000 shares of common stock are eligible for issuance under the 2021 Plan. ● The 2021 Plan may be administered by the Board of Directors (the “Board”) or a committee consisting of two or more members of the Board of Directors appointed by the Board (for purposes of this description, any such committee, a “Committee”). ● Officers and other employees of our Company or any parent or subsidiary of our Company who are at the time of the grant of an Award employed by us or any parent or subsidiary of our Company are eligible to be granted options or other Awards under the 2021 Plan.
In 2025, the Company’s stockholders approved an amendment to the 2021 Plan that increased the number of shares authorized from 400,000 to 1,150,000. ● The 2021 Plan may be administered by the Board of Directors (the “Board”) or a committee consisting of two or more members of the Board of Directors appointed by the Board (for purposes of this description, any such committee, a “Committee”). ● Officers and other employees of our Company or any parent or subsidiary of our Company who are at the time of the grant of an Award employed by us or any parent or subsidiary of our Company are eligible to be granted options or other Awards under the 2021 Plan.
The 2011 Plan and 2021 Plan allow for award holders to surrender vested shares to cover withholding tax liabilities. We did not repurchase any shares of common stock during the year ended December 31, 2023. ​
The 2011 Plan and 2021 Plan allow for award holders to surrender vested shares to cover withholding tax liabilities. ​
Removed
Recent Sales of Unregistered Securities On March 14, 2024, the Company entered into subscription agreements with each of Robert W.
Added
The stock options may be incentive stock options or non-qualified stock options. ● Originally, a total of 400,000 shares of common stock were eligible for issuance under the 2021 Plan.
Removed
D’Loren, Chairman and Chief Executive Officer of the Company; an affiliate of Mark DiSanto, a director of the Company; and Seth Burroughs, Executive Vice President of Business Development and Treasury of the Company to purchase 13,258, 13,258, and 2,946 shares, respectively (collectively, the “Private Placement Shares”), at a price of $9.80 per Private Placement Share.
Removed
The total number of Private Placement Shares purchased was 29,462. Net proceeds after payment of agent fees to the representative were approximately $0.3 million.
Removed
The purchase of the Private Placement Shares closed on March 19, 2024. 36 Table of Contents On December 12, 2024, the Company issued warrants to purchase 145,664 shares of common stock to lenders as additional consideration for entering into a loan and security agreement. The warrants are immediately exercisable and expire on December 12, 2034.
Removed
There were no sales of unregistered securities during the year ended December 31, 2023.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

75 edited+45 added−56 removed30 unchanged
Biggest changeThe following table is a reconciliation of net loss attributable to Xcel Brands, Inc. stockholders (our most directly comparable financial measure presented in accordance with GAAP) to non-GAAP net loss: ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ($ in thousands) 2024 2023 Net loss attributable to Xcel Brands, Inc. stockholders ​ $ (22,395) ​ $ (21,052) Asset impairment charges ​ ​ 3,483 ​ ​ 100 Amortization of trademarks ​ 4,790 ​ 6,085 Loss from equity method investments ​ ​ 7,623 ​ ​ 2,060 Contingent reduction in equity ownership of IM Topco, LLC ​ 4,213 ​ — Stock-based compensation and cost of licensee warrants ​ 509 ​ 242 Loss on extinguishment of debt ​ ​ 287 ​ ​ — Gains on sales of assets and investments ​ ​ (3,801) ​ ​ (359) Gain on lease termination ​ ​ — ​ ​ (445) Income tax provision ​ 220 ​ 1,212 Non-GAAP net loss ​ $ (5,071) ​ $ (12,157) ​ The following table is a reconciliation of diluted loss per share to non-GAAP diluted EPS: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ 2024 2023 Diluted loss per share attributable to Xcel Brands, Inc. stockholders ​ $ (9.84) ​ $ (10.68) Asset impairment charges ​ ​ 1.53 ​ ​ 0.05 Amortization of trademarks ​ 2.10 ​ 3.09 Loss from equity method investments ​ ​ 3.35 ​ ​ 1.05 Contingent reduction in equity ownership of IM Topco, LLC ​ 1.85 ​ — Stock-based compensation and cost of licensee warrants ​ 0.22 ​ 0.12 Loss on extinguishment of debt ​ ​ 0.13 ​ ​ — Gains on sales of assets and investments ​ ​ (1.67) ​ ​ (0.18) Gain on lease termination ​ ​ — ​ ​ (0.23) Income tax provision ​ 0.10 ​ 0.61 Non-GAAP diluted EPS ​ $ (2.23) ​ $ (6.17) Diluted weighted average shares outstanding ​ 2,275,332 ​ 1,971,072 44 Table of Contents ​ The following table is a reconciliation of net loss attributable to Xcel Brands, Inc. stockholders (our most directly comparable financial measure presented in accordance with GAAP) to Adjusted EBITDA: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ($ in thousands) 2024 2023 ​ Net loss attributable to Xcel Brands, Inc. stockholders ​ $ (22,395) ​ $ (21,052) ​ Interest and finance expense ​ 931 ​ 381 ​ Accretion of lease liability for exited lease ​ ​ 240 ​ ​ — ​ Income tax provision ​ 220 ​ 1,212 ​ State and local franchise taxes ​ 40 ​ 76 ​ Depreciation and amortization ​ 4,947 ​ 6,954 ​ Loss from equity method investments ​ ​ 7,623 ​ ​ 2,060 ​ Contingent reduction in equity ownership of IM Topco, LLC ​ ​ 4,213 ​ ​ — ​ Asset impairment charges ​ 3,483 ​ 100 ​ Stock-based compensation and cost of licensee warrants ​ 509 ​ 242 ​ Gains on sales of assets and investments ​ ​ (3,801) ​ ​ (359) ​ Gain on lease termination ​ ​ — ​ ​ (445) ​ Costs associated with restructuring of operations ​ 537 ​ 5,106 ​ Adjusted EBITDA ​ $ (3,453) ​ $ (5,725) ​ ​ Liquidity and Capital Resources General As of December 31, 2024 and 2023, our cash and cash equivalents were $1.3 million and $3.0 million, respectively.
Biggest changeWhen evaluating our performance, you should consider non-GAAP net income, non-GAAP diluted EPS, and Adjusted EBITDA alongside other financial performance measures, including our net income and other GAAP results, and not rely on any single financial measure. ​ 40 Table of Contents The following table is a reconciliation of net loss attributable to Xcel Brands, Inc. stockholders (our most directly comparable financial measure presented in accordance with GAAP) to non-GAAP net loss: ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ($ in thousands) 2025 ​ ​ ​ 2024 Net loss attributable to Xcel Brands, Inc. stockholders ​ $ (17,461) ​ $ (22,395) Asset impairment charges ​ ​ — ​ ​ 3,483 Amortization of trademarks ​ 3,502 ​ 4,790 Loss from equity investments ​ ​ 6,010 ​ ​ 11,836 Stock-based compensation and cost of licensee warrants ​ 796 ​ 509 Loss on extinguishment of debt ​ ​ 1,850 ​ ​ 287 Gains on sales of assets and investments ​ ​ — ​ ​ (3,801) Income tax provision ​ 75 ​ 220 Non-GAAP net loss ​ $ (5,228) ​ $ (5,071) ​ The following table is a reconciliation of diluted loss per share to non-GAAP diluted EPS: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ ​ 2025 ​ ​ ​ 2024 Diluted loss per share attributable to Xcel Brands, Inc. stockholders ​ $ (5.08) ​ $ (9.84) Asset impairment charges ​ ​ — ​ ​ 1.53 Amortization of trademarks ​ 1.02 ​ 2.10 Loss from equity investments ​ ​ 1.75 ​ ​ 5.20 Stock-based compensation and cost of licensee warrants ​ 0.23 ​ 0.22 Loss on extinguishment of debt ​ ​ 0.54 ​ ​ 0.13 Gains on sales of assets and investments ​ ​ — ​ ​ (1.67) Income tax provision ​ 0.02 ​ 0.10 Non-GAAP diluted EPS ​ $ (1.52) ​ $ (2.23) Diluted weighted average shares outstanding ​ 3,435,816 ​ 2,275,332 ​ The following table is a reconciliation of net loss attributable to Xcel Brands, Inc. stockholders (our most directly comparable financial measure presented in accordance with GAAP) to Adjusted EBITDA: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ($ in thousands) ​ ​ ​ 2025 ​ ​ ​ 2024 ​ Net loss attributable to Xcel Brands, Inc. stockholders ​ $ (17,461) ​ $ (22,395) ​ Interest and finance expense ​ 4,266 ​ 931 ​ Accretion of lease liability for exited lease ​ ​ 168 ​ ​ 240 ​ Income tax provision ​ 75 ​ 220 ​ State and local franchise taxes ​ 134 ​ 40 ​ Depreciation and amortization ​ 3,593 ​ 4,947 ​ Loss from equity investments ​ ​ 6,010 ​ ​ 11,836 ​ Asset impairment charges ​ — ​ 3,483 ​ Stock-based compensation and cost of licensee warrants ​ 796 ​ 509 ​ Gains on sales of assets and investments ​ ​ — ​ ​ (3,801) ​ Costs associated with restructuring of operations ​ 163 ​ 537 ​ Adjusted EBITDA ​ $ (2,256) ​ $ (3,453) ​ ​ Liquidity and Capital Resources General As of December 31, 2025 and 2024, our unrestricted cash and cash equivalents were approximately $1.2 million and $1.3 million, respectively. 41 Table of Contents Restricted cash at December 31, 2025 was approximately $1.7 million, and consisted of (i) $0.7 million of cash deposited as collateral for a standby letter of credit associated with a real estate lease and (ii) $1.0 million of cash deposited in a bank account to satisfy a liquidity covenant in the Company’s term loan debt agreement.
The Lori Goldstein Earn-Out of was initially recorded as a liability of $6.6 million, based on the difference between the fair value of the acquired assets of the Lori Goldstein Brand and the total consideration paid.
The Lori Goldstein Earn-Out was initially recorded as a liability of $6.6 million, based on the difference between the fair value of the acquired assets of the Lori Goldstein Brand and the total consideration paid.
More specifically, we separately identify: (i) Contracts for which, based on experience, royalties are expected to exceed any applicable minimum guaranteed payments, and to which an output-based measure of progress based on the “right to invoice” practical expedient is applied because the royalties due for each period correlate directly with the value to the customer of our performance in each period (this approach is identified as “View A” by the FASB Revenue Recognition Transition Resource Group, “TRG”); and 39 Table of Contents (ii) Contracts for which revenue is recognized based on minimum guaranteed payments using an appropriate measure of progress, in which minimum guaranteed payments are straight-lined over the term of the contract and recognized ratably based on the passage of time, and to which the royalty recognition constraint to the sales-based royalties in excess of minimum guaranteed is applied and such sales-based royalties are recognized to the distinct period only when the minimum guaranteed is exceeded on a cumulative basis (this approach is identified as “View C” by the TRG).
More specifically, we separately identify: (i) Contracts for which, based on experience, royalties are expected to exceed any applicable minimum guaranteed payments, and to which an output-based measure of progress based on the “right to invoice” practical expedient is applied because the royalties due for each period correlate directly with the value to the customer of our performance in each period (this approach is identified as “View A” by the FASB Revenue Recognition Transition Resource Group, “TRG”); and (ii) Contracts for which revenue is recognized based on minimum guaranteed payments using an appropriate measure of progress, in which minimum guaranteed payments are straight-lined over the term of the contract and 36 Table of Contents recognized ratably based on the passage of time, and to which the royalty recognition constraint to the sales-based royalties in excess of minimum guaranteed is applied and such sales-based royalties are recognized to the distinct period only when the minimum guaranteed is exceeded on a cumulative basis (this approach is identified as “View C” by the TRG).
This was primarily attributable to approximately $2.8 million of net cash proceeds generated from the December 2024 refinancing of our term loan debt ($8.0 million of gross cash proceeds, less $4.25 million repayment of our previous term loan debt and the payment of $0.9 million of debt issuance costs) and $1.9 million of net proceeds generated by equity issuance transactions undertaken during the first quarter of 2024.
This was primarily attributable to approximately $2.8 million of net cash proceeds generated from the December 2024 refinancing of our term loan debt ($8.0 million of gross cash proceeds, less $4.25 million repayment of our previous term loan debt and the payment of $0.9 million of debt issuance costs) and $1.9 million of net proceeds generated by equity offering transactions undertaken during the first quarter of 2024.
This location represented our former corporate offices and operations facility, and our lease for this location expires on October 30, 2027. Future payments under this lease are expected to be approximately $1.55 million for the year ending December 31, 2025, $1.55 million for the year ending December 31, 2026, and $1.29 million for the year ending December 31, 2027.
This location represented our former corporate offices and operations facility, and our lease for this location expires on October 30, 2027. Future payments under this lease are expected to be approximately $1.55 million for the year ending December 31, 2026 and $1.29 million for the year ending December 31, 2027.
Debt Transactions – December 2024 Refinancing On December 12, 2024, the Company and certain of its subsidiaries entered into a new loan and security agreement with FEAC Agent, LLC, as administrative agent and collateral agent, FEF Distributors, LLC, as lead arranger, and Restore Capital, LLC, as agent for certain lenders, pursuant to which the lenders made term loans to the Company and agreed to make additional term loans to the Company upon the satisfaction of a condition precedent described in the loan agreement.
Debt Transactions On December 12, 2024, the Company and certain of its subsidiaries entered into a new loan and security agreement with FEAC Agent, LLC, as administrative agent and collateral agent, FEF Distributors, LLC, as lead arranger, and Restore Capital, LLC (“Restore”), as agent for certain lenders, pursuant to which the lenders made term loans to the Company and agreed to make additional term loans to the Company upon the satisfaction of a condition precedent described in the loan agreement.
Equity Method Investments We account for our investments in entities over which we have the ability to exercise significant influence, but do not control, under the equity method of accounting, and we recognize our proportionate share of income or losses from the entity within other operating costs and expenses (income) in our consolidated statements of operations.
Investments in Unconsolidated Affiliates We account for our investments in entities over which we have the ability to exercise significant influence, but do not control, under the equity method of accounting, and recognize our proportionate share of income or losses from the entity within other operating costs and expenses (income) in our consolidated statements of operations.
The Current Year’s cash used in operating activities was primarily attributable to the combination of the net loss of $(22.6) million, partially offset by non-cash items of approximately $17.3 million and a net change in operating assets and liabilities of approximately $0.6 million.
The Prior Year’s cash used in operating activities was primarily attributable to the combination of the net loss of $(22.6) million, partially offset by non-cash items of approximately $17.3 million and a net change in operating assets and liabilities of approximately $0.6 million.
Non-cash items were primarily comprised of, but not limited to, undistributed losses and other charges related to equity method investees totaling $11.8 million, $4.9 million of depreciation and amortization, $3.5 million of asset impairment charges, and $0.4 million of stock-based compensation and cost of licensee warrants, partially offset by a $(3.8) million gain on the divestiture of the Lori Goldstein Brand.
Non-cash items were primarily comprised of, but not limited to, undistributed losses and other charges related to equity investments totaling $11.8 million, $4.9 million of depreciation and amortization, $3.5 million of asset impairment charges, and $0.4 million of stock-based compensation and cost of licensee warrants, partially offset by a $(3.8) million gain on the divestiture of the Lori Goldstein brand.
Management believes non-GAAP net income, non-GAAP diluted EPS, 43 Table of Contents and Adjusted EBITDA are also useful because these measures adjust for certain costs and other events that management believes are not representative of our core business operating results, and thus these non-GAAP measures provide supplemental information to assist investors in evaluating the Company’s financial results.
Management believes non-GAAP net income, non-GAAP diluted EPS, and Adjusted EBITDA are also useful because these measures adjust for certain costs and other events that management believes are not representative of our core business operating results, and thus these non-GAAP measures provide supplemental information to assist investors in evaluating the Company’s financial results.
However, in cases where contractual agreements 40 Table of Contents specify allocation ratios for profits and losses, specified costs and expenses, and/or distributions of cash from operations, that differ from our ownership interest, we use such specified allocation ratios for purposes of determining our share of income or losses from the investee if the agreement is considered substantive.
However, in cases where contractual agreements specify allocation ratios for profits and losses, specified costs and expenses, and/or distributions of cash from operations, that differ from our ownership interest, we use such specified allocation ratios for purposes of determining our share of income or losses from the investee if the agreement is considered substantive.
Non-GAAP net income and non-GAAP diluted EPS measures do not include the tax effect of the aforementioned adjusting items, due to the nature of these items and the Company’s tax strategy. We had Adjusted EBITDA of approximately $(3.5) million for the Current Year, compared with Adjusted EBITDA of approximately $(5.7) million for the Prior Year.
Non-GAAP net income (loss) and non-GAAP diluted EPS measures do not include the tax effect of the aforementioned adjusting items, due to the nature of these items and the Company’s tax strategy We had Adjusted EBITDA of approximately $(2.3) million for the Current Year, compared with Adjusted EBITDA of approximately $(3.5) million for the Prior Year.
To grow our brands, we are focused on the following primary strategies: ● distribution and/or licensing our brands for sale through interactive television (e.g., QVC, HSN, JTV, etc.); ● licensing of our brands to retailers that sell to the end consumer; ● licensing our brands to manufacturers and retailers for promotion and distribution through e-commerce, social commerce, and traditional brick-and-mortar retail channels; and ● acquiring additional consumer brands and integrating them into our operating platform, and leveraging our operating infrastructure and distribution relationships.
To grow our brands, we are focused on the following primary strategies: ● licensing of our brands for sale through interactive television (e.g., QVC, HSN, JTV, etc.); 35 Table of Contents ● licensing of our brands to retailers that sell to the end consumer; ● licensing our brands to manufacturers and retailers for promotion and distribution through e-commerce, social commerce, and brick-and-mortar retail channels; and ● acquiring additional consumer brands and integrating them into our operating platform, and leveraging our operating infrastructure and distribution relationships.
Subsequent recognition of an investor’s proportionate share of income or losses of an equity method investee is generally determined based on the investor’s proportional ownership interest.
The proportionate share of income or losses of an equity method investee is generally determined based on the investor’s proportional ownership interest.
Income Tax Provision The estimated annual effective income tax rate for the Current Year was approximately -1%, resulting in an income tax provision of $0.22 million.
The estimated annual effective income tax rate for the Prior Year was approximately -1%, resulting in an income tax provision of $0.22 million.
During the Current Year, management concluded that, based on current trends in and projections of IM Topco’s royalty revenues as well as the Company’s decision to not make the remaining royalty payments to IM Topco, it was virtually certain that the Company would be required to make such transfer of equity interests to WHP in 2025.
During 2024, management concluded that, based on current trends in and projections of IM Topco’s royalty revenues as well as the Company’s decision to not make the certain additional royalty payments to IM Topco, it was virtually certain that the Company would be required to make such transfer of equity interests to WHP in 2025.
If we are unable to take effective measures in a timely manner to mitigate the impact of inflation and/or a potential recession, our business, financial condition, and results of operations could be adversely affected.
If we are unable to take effective measures in a timely manner to mitigate the impact of these conditions and/or a potential recession, our business, financial condition, and results of operations could be adversely affected.
We believe that Xcel offers a unique value proposition to our retail and direct-to-consumer customers and our licensees for the following reasons: ● our management team, including our officers’ and directors’ experience in, and relationships within the industry; ● our deep knowledge, expertise, and proprietary technology in live streaming and social commerce; ● our design, sales, marketing, and technology platform that enables us to design trend-right product; and ● our significant media and digital presence.
We believe that Xcel offers a unique value proposition for the following reasons: ● our management team, including our officers’ and directors’ experience in, and relationships within the industry; ● our deep knowledge, expertise, and proprietary technology in live streaming and social commerce; ● our design, sales, marketing, and technology platform that enables us to design trend-right product; and ● our significant media and digital presence.
As a result, the Company de-recognized approximately $1.03 million of accrued Lori Goldstein Earn-Out payments and the remaining balance of approximately $5.05 million of contingent obligations recorded on the Company’s balance sheet. As of December 31, 2024, there are no liability amounts remaining on the Company’s balance sheet related to the Lori Goldstein Earn-Out.
As a result, we de-recognized approximately $1.03 million of accrued Lori Goldstein Earn-Out payments and the remaining balance of approximately $5.05 million of contingent obligations recorded on the Company’s balance sheet. As of December 31, 2024, there were no liability amounts remaining on the Company’s balance sheet related to the Lori Goldstein Earn-Out.
There were no impairment charges recorded for our intangible assets for the years ended December 31, 2024 and 2023.
There were no impairment charges recorded for our intangible assets for the years ended December 31, 2025 and 2024.
While our significant accounting policies and estimates are described in more detail in the notes to our consolidated financial statements, our most critical accounting policies and estimates, discussed below, pertain to revenue recognition, trademarks and other intangible assets, equity method investments, and income taxes.
While our significant accounting policies and estimates are described in more detail in the notes to our consolidated financial statements, our most critical accounting policies and estimates, discussed below, pertain to revenue recognition, trademarks and other intangible assets, investments in unconsolidated affiliates, and income taxes.
Revenue Recognition Licensing In connection with our “licensing plus” business model, we follow Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606-10-55-65, by which we recognize licensing revenue at the later of when (1) the subsequent sale or usage occurs or (2) the performance obligation to which some or all of the sales- or usage-based royalty has been allocated is satisfied (in whole or in part).
Revenue Recognition We follow Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 606-10-55-65, by which we recognize licensing revenue at the later of when (1) the subsequent sale or usage occurs or (2) the performance obligation to which some or all of the sales- or usage-based royalty has been allocated is satisfied (in whole or in part).
Unanticipated changes in consumer fashion preferences and purchasing patterns, slowdowns in the U.S. economy, changes in the prices of supplies, consolidation of retail establishments, and other factors noted in the section captioned “Risk Factors” could adversely affect our licensees’ ability to meet and/or exceed their contractual commitments to us and thereby adversely affect our future operating results. ​
Unanticipated changes in consumer fashion preferences and purchasing patterns, slowdowns in the U.S. economy, and other factors noted in the section captioned “Risk Factors” could adversely affect our licensees’ ability to meet and/or exceed their contractual commitments to us and thereby adversely affect our future operating results. ​
To test our finite-lived intangible assets for impairment, we group assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities and evaluate the asset group against the sum of undiscounted future cash flows.
To test our finite-lived intangible assets for impairment, we group assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities and evaluate the asset group against the sum of undiscounted future cash flows which are based on revenue growth estimates.
In addition, we review our equity method investments whenever there are indicators that their carrying value may not be recoverable; if a decrease in value of the investment has occurred and such decrease is determined to be other than temporary in nature, we record an impairment charge to reduce the carrying amount of the investment to its fair value.
In addition, we review our investments in unconsolidated affiliates that are not accounted for at fair value whenever there are indicators that their carrying value may not be recoverable; if a decrease in value of the investment has occurred and such decrease is determined to be other than temporary in nature, we record an impairment charge to reduce the carrying amount of the investment to its fair value.
Also during the Current Year, we recognized asset impairment charges of approximately $3.48 million related to our exit from and sublease of our offices at 1333 Broadway, of which approximately $3.1 million related to the operating lease right-of-use asset and approximately $0.4 million related to leasehold improvements at that location.
During the Prior Year, we recognized asset impairment charges of $3.48 million related to our exit from and sublease of our office space at 1333 Broadway, of which approximately $3.1 million related to the operating lease right-of-use asset and approximately $0.4 million related to leasehold improvements at that location.
These include but are not limited to: the estimation of the useful lives of our trademarks, and the estimation of future cash flows related to our trademarks; the estimation of the fair value of our equity method investments, and judgment as to whether any declines in value are temporary; and the estimation of our future income projections and the likelihood that we will be able to realize our deferred tax assets.
These include but are not limited to: the estimation of the useful lives of our trademarks, and the estimation of future cash flows related to our trademarks; the valuation and accounting for our investments in unconsolidated affiliates, and judgment as to whether any declines in value are temporary; and the estimation of our future income projections and the likelihood that we will be able to realize our deferred tax assets.
Summary of Operating Results The consolidated financial statements and related notes included elsewhere in this Form 10-K are as of or for the years ended December 31, 2024 (the “Current Year”), and December 31, 2023 (the “Prior Year”). Revenues Current Year net revenue decreased approximately $9.5 million to $8.3 million from $17.8 million for the Prior Year.
Summary of Operating Results The consolidated financial statements and related notes included elsewhere in this Form 10-K are as of or for the years ended December 31, 2025 (the “Current Year”), and December 31, 2024 (the “Prior Year”). Revenues Net revenue decreased approximately $3.32 million to $4.94 million for the Current Year, from $8.26 million for the Prior Year.
Non-GAAP Net Income, Non-GAAP Diluted EPS, and Adjusted EBITDA We had a non-GAAP net loss of $5.1 million or $(2.23) per share (“non-GAAP diluted EPS”) based on 2,275,332 weighted average shares outstanding for the Current Year, compared with a non-GAAP net loss of $12.2 million or $(6.17) per share based on 1,971,072 weighted average shares outstanding for the Prior Year.
Non-GAAP Net Income, Non-GAAP Diluted EPS, and Adjusted EBITDA We had a non-GAAP net loss of $5.2 million or $(1.52) per share (“non-GAAP diluted EPS”) based on 3,435,816 weighted average shares outstanding for the Current Year, compared with a non-GAAP net loss of $5.1 million or $(2.23) per share based on 2,275,332 weighted average shares outstanding for the Prior Year.
Poor economic and market conditions, including the impacts of recent inflation and rising consumer debt levels, may negatively impact market sentiment, decreasing the demand for apparel, footwear, accessories, fine jewelry, home goods, and other consumer products, which would adversely affect our operating income and results of operations.
Poor economic and market conditions, including the cumulative impacts of inflation and rising consumer debt levels, along with the impact of tariffs on goods imported into the U.S., may negatively impact consumer sentiment, decreasing the demand for apparel, footwear, accessories, fine jewelry, home goods, and other consumer products, which would adversely affect our operating income and results of operations.
This discussion summarizes the significant factors affecting our consolidated operating results, financial condition and liquidity and cash flows for the years ended December 31, 2024 and 2023.
This discussion summarizes the significant factors affecting our consolidated operating results, financial condition and liquidity and cash flows for the years ended 34 Table of Contents December 31, 2025 and 2024.
The term loans under the loan agreement are as follows: (1) a term loan in the amount of $3.95 million (“Term Loan A”) was made on the closing date, (2) a term loan in the amount of $4.0 million (“Term Loan B”) was made on the closing date, and (3) a term loan in the amount of $2.05 million (“Delayed Draw Term Loan”; Term Loan A, Term Loan B and Delayed Draw Term Loan are referred to as “Term Loans”) which will be made upon the satisfaction of a condition precedent described in the loan agreement.
The term loans under the loan agreement are as follows: (1) a term loan in the amount of $3.95 million (“Term Loan A”) was made on the closing date, (2) a term loan in the amount of $4.0 million (“Term Loan B”) was made on the closing date, and (3) a term loan in the amount of $2.05 million (“Delayed Draw Term Loan”; Term Loan A, Term Loan B and Delayed Draw Term Loan are referred to as “Term Loans”) was subsequently made in March 2025.
This decrease was primarily attributable to the 2023 restructuring and transformation of our business operating model, which included reductions in staffing levels as well as related reductions in other overhead costs, as well as additional actions taken in 2024 to further optimize our cost structure (including the divestiture of the Lori Goldstein Brand, which eliminated certain operating and compensation expenses).
This decrease was primarily attributable to (i) the 2023 restructuring and transformation of our business operating model, which included reductions in staffing levels as well as related reductions in other overhead costs, (ii) additional actions taken in 2024 to further optimize our cost structure (including the divestiture of the Lori 38 Table of Contents Goldstein Brand, which eliminated certain operating and compensation expenses), and (iii) the impact of the employee retention tax credit recognized in the Current Year.
The net book value of the intangible assets sold was approximately $1.93 million, and we also incurred approximately $0.35 million of legal fees in connection with the sale.
The net book value of the intangible assets sold was approximately $1.93 million, and we also incurred approximately $0.35 million of legal fees in connection with the sale. There were no comparable amounts recognized in the Current Year.
Employment Contracts We have entered into contracts with certain executives and key employees. The future minimum payments under these contracts is approximately $2.1 million, which is expected to be paid in 2025.
Employment Contracts We have entered into contracts with certain executives and key employees. The future minimum compensation payments under these contracts are approximately $2.2 million, of which $2.0 million and $0.2 million is expected to be paid in 2026 and 2027, respectively.
Non-GAAP net income is a non-GAAP unaudited term, which we define as net income (loss) attributable to Xcel Brands, Inc. stockholders, exclusive of asset impairment charges, amortization of trademarks, income (loss) from equity method investments, contingent reduction in equity ownership of IM Topco, LLC, stock-based compensation and cost of licensee warrants, loss on extinguishment of debt, gains on sales of assets and investments, gain on lease termination , and income taxes.
Non-GAAP net income (loss) is a non-GAAP unaudited term, which we define as net income (loss) attributable to Xcel Brands, Inc. stockholders, exclusive of asset impairment charges (if any), amortization of trademarks, income (loss) from equity investments, stock-based compensation and cost of licensee warrants, loss on early extinguishment of debt (if any), gains on sales of assets and investments (if any), and income taxes.
Other Operating Costs and Expenses (Income) Depreciation and amortization expense decreased approximately $2.00 million, from $6.95 million in the Prior Year to $4.95 million in the Current Year.
Other Operating Costs and Expenses (Income) Depreciation and amortization expense decreased approximately $1.36 million, from $4.95 million in the Prior Year to $3.59 million in the Current Year.
Net Loss Attributable to Xcel Brands, Inc. Stockholders We had a net loss of approximately $22.4 million for the Current Year, compared with a net loss of approximately $21.1 million for the Prior Year, as a result of the factors discussed above.
Stockholders We had a net loss of approximately $17.5 million for the Current Year, compared with a net loss of approximately $22.4 million for the Prior Year, as a result of the factors discussed above.
The Prior Year’s cash used in operating activities was primarily attributable to the combination of the net loss of $(22.2) million, partially offset by non-cash items of approximately $9.8 million and a net change in operating assets and liabilities of approximately $5.9 million.
The Current Year’s cash used in operating activities was primarily attributable to the combination of the net loss of $(17.6) million and a net change in operating assets and liabilities of approximately $(2.7) million, partially offset by non-cash items of approximately $13.3 million.
Future payments under this lease are expected to be approximately $0.37 million for the year ending December 31, 2025, $0.51 million for the year ending December 31, 2026, $0.55 million for the year ending December 31, 2027, $0.57 million for the year ending December 31, 2028, $0.58 million for the year ending December 31, 2029, and $1.42 million thereafter.
Future payments under this lease are expected to be approximately $0.51 million for the year ending December 31, 2026, $0.55 million for the year ending December 31, 2027, $0.57 million for the year ending December 31, 2028, $0.58 million for the year ending December 31, 2029, $0.60 million for the year ending December 31, 2030, $0.61 million for the year ending December 31, 2031, and $0.21 million for the year ending December 31, 2032.
During the Current Year, we recognized a $3.80 million gain on the divestiture of the Lori Goldstein Brand. The consideration received from this transaction was non-cash in nature, and consisted of approximately $6.08 million of relief from certain accrued earn-out payments and the release of contingent obligations under contractual agreements with the buyer.
The consideration received from this transaction was non-cash in nature, and consisted of approximately $6.08 million of relief from certain accrued earn-out payments and the release of contingent obligations under contractual agreements with the buyer.
Adjusted EBITDA is a non-GAAP unaudited measure, which we define as net income (loss) attributable to Xcel Brands, Inc. stockholders before interest and finance expenses (including loss on extinguishment of debt, if any), accretion of lease liability for exited leases, income taxes, other state and local franchise taxes, depreciation and amortization, income (loss) from equity method investments, contingent reduction in equity ownership of IM Topco, LLC, asset impairment charges, stock-based compensation and cost of licensee warrants, gains on sales of assets and investments, gain on lease termination , and costs associated with restructuring of operations.
Adjusted EBITDA is a non-GAAP unaudited measure, which we define as net income (loss) attributable to Xcel Brands, Inc. stockholders before interest and finance expenses (including loss on extinguishment of debt, if any), accretion of lease liability for exited leases, income taxes, other state and local franchise taxes, depreciation and amortization, income (loss) from equity investments, asset impairment charges (if any), stock-based compensation and cost of licensee warrants, gains on sales of assets and investments (if any), and costs associated with restructuring of operations (including operating losses generated by certain of our businesses that have been restructured or discontinued, as well as non-cash charges associated with the restructuring of certain contractual arrangements, and severance payments).
We continue to seek new opportunities, including expansion through interactive television, live streaming, and additional domestic and international licensing arrangements, and acquiring and collaborating with additional brands, including the recently-launched TowerHill by Christie Brinkley brand and LB70 by Lloyd Boston brand.
We continue to seek new opportunities, including expansion through interactive television, live streaming, and additional domestic and international licensing arrangements, and acquiring and collaborating with additional brands. The successful launch of the TowerHill by Christie Brinkley brand in 2024 is an example of this.
We plan to continue to diversify the distribution channels within which licensed products are sold, in an effort to reduce dependence on any particular retailer, consumer, or market sector within each of our brands.
We plan to continue to diversify the distribution channels within which licensed products are sold, in an effort to reduce dependence on any particular retailer, consumer, or market sector within each of our brands. The Halston brand, C Wonder brand, and TowerHill by Christie Brinkley brand have a core business in fashion apparel and accessories.
Equity Financing Transactions – Public Offering and Private Placement ​ On March 19, 2024, the Company closed on a public offering of 328,427 shares of common stock at an offering price of $6.50 per share and a private placement of 29,462 shares of common stock at an offering price of $9.80 per share.
Also during the Prior Year, we made $0.75 million of scheduled principal payments on term loan debt. ​ March 2024 Public Offering and Private Placement Transactions ​ On March 19, 2024, the Company closed on a public offering of 328,427 shares of common stock at an offering price of $6.50 per share and a private placement of 29,462 shares of common stock at an offering price of $9.80 per share.
D’Loren, an affiliate of Mark DiSanto, and Seth Burroughs also purchased 13,258, 13,258, and 2,946 shares of common stock, respectively, in the private placement. The aggregate number of shares of common stock issued from the public offering and the private placement was 357,889 shares and the total net proceeds received was approximately $1.9 million.
The aggregate number of shares of common stock issued from the public offering and the private placement was 357,889 shares and the total net proceeds received were approximately $1.9 million.
On April 15, 2025, such equity interests were transferred to WHP. Real Estate Leases We are currently party to a lease (as lessee) for approximately 29,600 square feet of office space at 1333 Broadway, 10th floor, New York, New York.
On and effective April 15, 2025, such equity interests were transferred to WHP in full satisfaction and settlement of this contractual obligation, and the previously recorded liability was de-recognized by reducing the value of the asset for the investment in IM Topco. 46 Table of Contents Real Estate Leases We are currently party to a lease (as lessee) for approximately 29,600 square feet of office space at 1333 Broadway, 10th floor, New York, New York.
During the Prior Year, the federal statutory rate differed from the effective tax rate primarily due to the initial establishment of a valuation allowance against the Company’s cumulative net deferred tax assets, as it was determined that it was not more likely than not that the net operating losses generated by the Company will be utilized in future periods.
During the Prior Year, the effective tax rate differed from the federal statutory rate primarily due to the recording of a valuation allowance against the benefit that would have otherwise been recognized for the year, as it was considered not more likely than not that the net operating losses generated during the year will be utilized in future periods. 39 Table of Contents Net Loss Attributable to Xcel Brands, Inc.
We have subleased this office space to a third-party subtenant through October 30, 2027. We are also currently party to a lease (as lessee) for approximately 12,000 square feet of office space at 550 Seventh Avenue, 11th floor, New York, New York.
We are also currently party to a lease (as lessee) for approximately 12,000 square feet of office space at 550 Seventh Avenue, 11th floor, New York, New York. This location represents our current corporate offices and operations facility, and our lease for this location expires in 2032.
Our principal capital requirements have been to fund working capital needs, acquire new brands, and to a lesser extent, capital expenditures. Our current “licensing plus” operating model is a working capital light business model, and generally does not require material capital expenditures. As of December 31, 2024, we have no significant commitments for future capital expenditures.
Our current “licensing plus” operating model is a working capital light business model, and generally does not require material capital expenditures. As of December 31, 2025, we have no significant commitments for future capital expenditures. Material cash requirements from known contractual and other obligations are discussed under “Obligations and Commitments” below.
Material cash requirements from known contractual and other obligations are discussed under “Obligations and Commitments” below. Working Capital Our working capital (current assets less current liabilities, excluding the current portions of lease obligations, deferred revenue, and any contingent obligations payable in shares) was $0.8 million and $3.0 million as of December 31, 2024 and 2023, respectively.
Working Capital Our working capital (which we calculate in a non-GAAP manner as current assets less current liabilities, excluding the current portions of lease obligations, deferred revenue, and any contingent obligations payable in shares) surplus/(deficit) was $(0.8) million and $0.8 million as of December 31, 2025 and 2024, respectively.
Xcel continues to pioneer a true omni-channel and social commerce sales strategy which includes the promotion and sale of products under its brands through interactive television, digital live-stream shopping, social commerce, traditional brick-and-mortar retailers, and e-commerce channels, to be everywhere its customers shop.
Xcel is pioneering a true omni-channel and social commerce sales strategy which includes the promotion and sale of products under its brands through interactive television, digital live-stream shopping, social commerce, brick-and-mortar retailers, and e-commerce channels. We currently operate under a working-capital light model, with our licensees and/or retail partners responsible for the procurement and sale of inventory.
Operating Activities Net cash used in operating activities was approximately $4.7 million and $6.5 million in the Current Year and Prior Year, respectively.
Commentary on components of our cash flows for the Current Year compared with the Prior Year is set forth below. Operating Activities Net cash used in operating activities was approximately $7.0 million and $4.7 million in the Current Year and Prior Year, respectively.
This amendment also provided that if (i) IM Topco royalties are less than $13.5 million for the twelve-month period ending March 31, 2025 or (ii) IM Topco royalties are less than $18.0 million for the year ending December 31, 2025 or (iii) Xcel fails to make certain payments to IM Topco under the terms of a certain license agreement between Xcel and IM Topco on or before January 30, 2025, then Xcel shall transfer equity interests in IM Topco to WHP equal to 12.5% of the total outstanding equity interests of IM Topco, such that Xcel’s ownership interest in IM Topco would decrease from 30% to 17.5%, and WHP’s ownership interest in IM Topco would increase from 70% to 82.5%.
Contingent Obligation – Isaac Mizrahi Transaction Under the terms of the May 31, 2022 transaction related to the sale of a majority interest in the Isaac Mizrahi brand (as subsequently amended in 2023 and 2024), the Company had agreed with WHP (the buyer) that, in the event that the aggregate royalties received by IM Topco were less than $13.5 million for the twelve-month period ending March 31, 2025 or less than $18.0 million for the year ending December 31, 2025, Xcel was obligated to transfer equity interests in IM Topco to WHP equal to 12.5% of the total outstanding equity interests of IM Topco, such that Xcel’s ownership interest in IM Topco would decrease from 30% to 17.5%, and WHP’s ownership interest in IM Topco would increase from 70% to 82.5%.
The loans outstanding after giving effect to this amendment and the application of the proceeds of the additional Term Loan B are as follows: (1) Term Loan A in the amount of $2.45 million, (2) Term Loan B in the amount of $9.12 million, and (3) Delayed Draw Term Loan in the amount of $2.05 million. ​ The proceeds from the additional Term Loan B were used to repay a portion of Term Loan A, as well as to pay fees, costs, and expenses incurred in connection with entering into the April 21, 2025 amendment, and the balance will be used for working capital purposes. ​ Within 30 days after April 21, 2025, the outstanding principal amount of the Term Loan A shall be repaid, on a pro rata basis in an aggregate amount equal to $500,000.
The proceeds from the additional Term Loan B were used to repay a portion of Term Loan A, as well as to pay fees, costs, and expenses incurred in connection with entering into the April 21, 2025 amendment, with the balance to be used for working capital purposes.
The only net product sales in the Current Year were related to the final sale of certain residual jewelry inventories and the sale of all remaining inventory related to the Longaberger brand; as of December 31, 2024, the Company has no remaining inventory.
Also contributing to the decrease in revenue from the Prior Year was the fact that in the Prior Year, we recognized $0.35 million of net product sales from the final sale of certain residual jewelry inventories and the sale of all remaining inventory related to the Longaberger brand, with no net product sales recognized in the Current Year.
Financing Activities Net cash provided by financing activities for the Current Year was approximately $3.8 million.
Also during the Current Year, we made $0.75 million of principal payments on our term loan debt. ​ Net cash provided by financing activities for the Prior Year was approximately $3.8 million.
Our brand portfolio also included the Lori Goldstein Brand as a wholly owned brand from April 1, 2021 through June 30, 2024; the Lori Goldstein Brand was divested on June 30, 2024. We also own a 19% interest in ORME, a short-form video and social commerce marketplace that launched in April 2024.
Our brand portfolio also formerly included: ● the LOGO by Lori Goldstein brand as a wholly owned brand from April 1, 2021 through June 30, 2024; and ● the Isaac Mizrahi brand, in which we hold a noncontrolling ownership interest through October 1, 2025.
This represents approximately $21 million of cost savings on an annualized basis compared to our cost structure in 2022. Management has continued to implement additional cost cutting measures throughout the first quarter of 2025 to further optimize the Company’s cost structure; these additional actions have reduced direct operating expenses to a run rate of less than $10 million per annum.
As a result, we have reduced our direct operating expenses to 47 Table of Contents an expected run rate of less than $10 million per annum, which represents approximately $21 million of cost savings on an annualized basis compared to our cost structure in 2022. Nonetheless, we continue to face a number of headwinds in the current macroeconomic environment.
The effective income tax rate for the Prior Year was approximately -6%, resulting in a $1.21 million income tax provision.
Income Tax Provision The estimated annual effective income tax rate for the Current Year was less than -1%, resulting in an income tax provision of $0.08 million.
There were no such comparable impairment charges for the year ended December 31, 2023. Income Taxes Income tax expense is the tax payable for the period and the change during the period in deferred tax assets and liabilities.
The remaining carrying value of our investments in unconsolidated affiliates as of December 31, 2025 was zero. Income Taxes Income tax expense is the tax payable for the period and the change during the period in deferred tax assets and liabilities.
Also, in October 47 Table of Contents 2024, IPX made a $250,000 non-interest-bearing advance to one of the Company’s subsidiaries, of which $200,000 was repaid to IPX upon the closing of the December 12, 2024 debt refinancing transaction. ​ Debt Transactions – April 2025 Refinancing On April 21, 2025, the Company and certain of its subsidiaries entered into an amendment with each lender party thereto and FEAC Agent, LLC, pursuant to which the December 12, 2024 loan and security agreement, was amended to provide for $1.5 million repayment of the $3.95 million Term Loan A made on December 12, 2024 and an additional Term Loan B in the amount of $5.12 million on April 21, 2025.
D’Loren, Chairman and Chief Executive Officer of the Company, purchased a 12.5 % undivided, last-out, subordinated participation interest in a portion of Term Loan B debt for a purchase price of $ 0.5 million , and received a pro rata share of warrants received by the Term Loan B Lenders to purchase shares of the Company’s common stock. 43 Table of Contents On April 21, 2025, the Company and certain of its subsidiaries and its lenders and FEAC Agent, LLC entered into an amendment of the December 12, 2024 loan and security agreement, which provided for a $1.5 million repayment of the $3.95 million Term Loan A, and an additional Term Loan B in the amount of $5.12 million.
During the year ended December 31, 2024, we recognized a $5.75 million non-cash charge for the other-than-temporary impairment of our investment in IM Topco, LLC, stemming from a decline in the fair value of the investment as a result of decreases in IM Topco, LLC’s revenues and cash flows.
The Prior Year amount was composed of (i) $1.73 million of equity method losses, (ii) a $4.21 million non-cash charge to recognize a contractual contingent obligation related to IM Topco, which was subsequently satisfied and discharged in April 2025, and (iii) a $5.75 million other-than-temporary impairment of our investment in IM Topco, stemming from a decline in the fair value of the investment as a result of decreases in IM Topco’s revenues and cash flows.
The proceeds from the Delayed Draw Term Loan will be deposited in a bank account to satisfy a liquidity covenant in the loan agreement.
A portion of the proceeds from the Delayed Draw Term Loan were deposited in a bank account to satisfy a liquidity covenant in the loan agreement. As part of the December 12, 2024 financing transaction, IPX Capital, LLC (“IPX”), a company controlled by Robert W.
Restricted cash at December 31, 2024 (included within other non-current assets in the consolidated balance sheet) consisted of $0.7 million of cash deposited as collateral for a standby letter of credit associated with a real estate lease; there was no restricted cash as of December 31, 2023.
Restricted cash at December 31, 2024 consisted of $0.7 million of cash deposited as collateral for a standby letter of credit associated with a real estate lease. Our principal capital requirements have generally been to fund working capital needs and acquire new brands.
Currently, our brand portfolio consists of the following: ● the Halston Brand, the Ripka Brand, and the C Wonder Brand, which are wholly owned by the Company; 37 Table of Contents ● the TowerHill by Christie Brinkley brand, which is a co-branded collaboration between Xcel and Christie Brinkley that launched in May 2024; ● the LB70 by Lloyd Boston brand, which is a co-branded collaboration between Xcel and Lloyd Boston that launched in August 2024; ● the Longaberger Brand, which we manage through our 50% ownership interest in Longaberger Licensing, LLC; and ● the Isaac Mizrahi brands (the “Isaac Mizrahi Brand”), in which we hold a noncontrolling interest through our 17.5% ownership interest in IM Topco, LLC (“IM Topco”) and continue to contribute to the operations of the brand through a service agreement with IM Topco.
Currently, our brand portfolio consists of the following: ● the Halston Brand, the Ripka Brand, and the C Wonder Brand, which are wholly owned by the Company; ● the Longaberger Brand, which we manage through our 50% ownership interest in Longaberger Licensing, LLC; ● the TowerHill by Christie Brinkley brand, which is a co-branded collaboration between Xcel and Christie Brinkley that launched in May 2024; ● the Trust-Respect-Love by Cesar Millan brand, which is a new co-branded collaboration between Xcel and Cesar Millan, which is planned to launch in Spring 2026; ● the GemmaMade by Gemma Stafford brand, which is a new co-branded collaboration between Xcel and Gemma Stafford, which is planned to launch in Spring 2026; ● the Off/Duty by Coco Rocha brand, which is a new co-branded collaboration between Xcel and Coco Rocha, which is planned to launch in Fall 2026; and ● Mesa Mia by Jenny Martinez, which is a brand owned by Mexican home influencer Jenny Martinez, and for which Xcel holds the television rights through a long-term license agreement and expects to launch in Spring 2026.
During 2023, we restructured our business operations by shifting our business from a wholesale/licensing hybrid model into a “licensing plus” business model. These efforts included entering into new structured contractual arrangements with best-in-class business partners in order to more efficiently operate our wholesale and e-commerce businesses and reduce and better manage our exposure to operating risks.
During 2023 and 2024, we restructured our business by shifting from a wholesale/licensing hybrid model to a “licensing plus” business model, divesting certain brands, and undertaking various cost-cutting measures to more efficiently operate our business and reduce and better manage our exposure to operating risks. During 2025, we continued to implement additional measures to further optimize our cost structure.
We also recognized $9.96 million of non-cash charges in the Current Year related to our investment in IM Topco, LLC, including (i) a $4.21 million non-cash charge to recognize the estimated value of our contractual obligation to transfer a portion of our equity ownership interests in IM Topco, LLC to WHP in 2025, and (ii) a $5.75 million non-cash charge for the other-than-temporary impairment of our investment in IM Topco, LLC.
During the year ended December 31, 2024, we recognized a $11.84 million loss related to our investments in unconsolidated affiliates, comprised of a $1.88 million equity method loss, a $5.75 million other-than-temporary impairment charge, and a $4.21 million non-cash charge to recognize a contingent obligation related to certain contractual 37 Table of Contents provisions related to IM Topco, LLC.
Partially offsetting these net changes in operating assets and liabilities were decreases in various operating liabilities of approximately $(2.9) million. Investing Activities Net cash used in investing activities for the Current Year was comprised of purchases of furniture and fixtures totaling approximately $0.1 million.
Investing Activities Net cash used in investing activities for the Current Year and Prior Year was $0.01 million and $0.11 million, respectively, and was comprised of purchases of property and equipment. Financing Activities Net cash provided by financing activities for the Current Year was approximately $7.9 million.
As such, the Company estimated and recorded a contingent obligation of $4.2 million in the accompanying consolidated balance sheets, and recognized a corresponding non-cash charge in the consolidated statements of operations for the Current Year. 49 Table of Contents On January 31, 2025, in accordance with the terms of the amended membership purchase agreement between Xcel and WHP, WHP became contractually entitled to receive from Xcel equity interests in IM Topco equal to 12.5% of the total outstanding equity interests of IM Topco.
As such, the Company estimated and recorded a contingent obligation of $4.21 million in the accompanying consolidated balance sheets, and recognized a corresponding non-cash charge in the consolidated statements of operations for the Prior Year.
The Company also issued warrants to purchase 30,000 shares of common stock to Restore Capital (EQ-W), LLC (“Restore”), another of the lenders, and amended warrants to purchase an aggregate of 107,333 shares of common stock held by Restore and warrants previously issued to warrants of FEAC Agent, LLC. ​ Also in connection with this refinancing transaction, IPX’s participation in Term Loan B was repaid and IPX purchased a $500,000 undivided, last-out, subordinated participation interest in Term Loan A. ​ Obligations and Commitments ​ Term Loan Debt ​ Refer to information outlined under ‘Debt Transactions – December 2024 Refinancing’ and ‘Debt Transactions – April 2025 Refinancing’ above. ​ 48 Table of Contents Contingent Obligation – Lori Goldstein Earn-Out In connection with the April 1, 2021 purchase of the Lori Goldstein trademarks, we had agreed to pay the seller additional cash consideration (the “Lori Goldstein Earn-Out”) of up to $12.5 million, based on royalties earned during the six calendar year period commencing in 2021.
As such, following the funding and completion of the transactions described above, the Company’s debt obligations will be as follows: (1) Senior Secured Notes in the principal amount of $2.6 million, with payments commencing October 13, 2026 and a maturity date of April 13, 2027, (2) Term Loan A in the principal amount of $0.5 million, payable on the maturity date of September 20, 2027, and (3) Term Loan B in the amount of $9.9 million, payable on the maturity date of December 12, 2028. ​ Obligations and Commitments ​ Term Loan Debt ​ Refer to information outlined above. ​ Senior Secured Notes ​ Refer to information outlined above. ​ Contingent Obligation – Lori Goldstein Earn-Out In connection with the April 1, 2021 purchase of the Lori Goldstein trademarks, we had agreed to pay the seller additional cash consideration (the “Lori Goldstein Earn-Out”) of up to $12.5 million, based on royalties earned during the six calendar year period commencing in 2021.
The April 21, 2025 amendment contains various customary financial covenants and reporting requirements, as specified and defined therein, including that (i) Company is required to maintain a class or series of capital stock that is traded on the New York Stock Exchange or the NASDAQ; and (iii) Company is required to file a Form S-1 Registration Statement with the SEC. ​ In connection with this refinancing transaction, UTG Capital, Inc., a Delaware corporation (“UTG”), purchased a 100% undivided, participation interest in Term Loan B for a purchase price of $9.12 million and received warrants entitling it to purchase 1,107,457 warrants shares of the Company.
In connection with the April 21, 2025 amendment and refinancing transaction, UTG Capital, Inc., a Delaware corporation (UTG”), purchased a 100% undivided, participation interest in Term Loan B for a purchase price of $9.12 million.
Accordingly, as of December 31, 2023, $1.0 million of the remaining balance was recorded as a current liability and approximately $5.4 million was recorded as a long-term liability. During the first quarter of 2024, the Company paid approximately $0.3 million of the $1.0 million earned.
Through January 1, 2024, we paid $0.2 million to the seller, and as of January 1, 2024, the remaining balance of the contingent obligation was $6.4 million, of which approximately $1.03 million had been earned and was payable to the seller. During the year ended December 31, 2024, we paid approximately $0.3 million to the seller.
Equity method losses related to our equity investments in unconsolidated affiliates (IM Topco, LLC and Orme Live Inc.) were $1.73 million and $2.06 million for the Current Year and Prior Year, respectively, due to the operations of those businesses and the allocation and distribution provisions of the applicable operating agreements.
We recognized losses related to our equity investments in unconsolidated affiliates of $6.01 million and $11.69 million for the Current Year and Prior Year, respectively.
Non-cash items were primarily comprised of, but not limited to, $7.0 million of depreciation and amortization, the $2.1 million undistributed proportional share of net loss of equity method investee, and $1.1 million of deferred taxes, partially offset by a $(0.4) million gain on the sale of a financial asset and a $(0.4) million gain on the settlement of a lease liability.
Non-cash items were primarily comprised of, but not limited to, undistributed losses and other charges related to equity investments totaling $6.0 million, $3.6 million of depreciation and amortization, a $1.9 million loss on the early extinguishment of debt, and $1.2 million of non-cash interest and finance expenses (including paid in-kind interest, amortization of deferred finance costs, and other non-cash interest expense).
Removed
Our brands have generated over $5 billion in retail sales via live streaming in interactive television and digital channels alone, and our brands collectively reach over 5 million social media followers through Facebook, Instagram, and TikTok. All of the followers may not be unique followers, as many followers may follow multiple brands and follow our brands on multiple platforms.
Added
As such, our revenues primarily consist of royalty revenues, and we do not have risk of carrying aged inventory. As a result, fluctuations in product costs and tariffs do not have a direct impact on us, but may impact us indirectly as our royalty revenues are typically based on the net sales and success of our licensees.
Removed
Business Model and Operations Restructuring During 2023, we restructured our business operations by shifting our business from a more capital-intensive wholesale/licensing hybrid model to a capital-light “licensing plus” model.
Added
As of December 31, 2025, we no longer have any investments accounted for under the equity method. Investments in entities in which we do not have the ability to exercise significant influence nor control, are generally required to be accounted for at fair value, with unrealized holding gains and losses included in earnings.
Removed
These efforts included entering into new 38 Table of Contents structured contractual arrangements with best-in-class business partners (including G-III for the Halston Brand, JTV for the Ripka Brand, and One Jeanswear Group, LLC for wholesale production related to certain of our other brands) in order to more efficiently operate our wholesale and e-commerce businesses and reduce and better manage our exposure to operating risks.

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