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Description of Business and Basis of Presentation	9 Months Ended
Sep. 30, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Description of Business and Basis of Presentation	1. Description of Business and Basis of Presentation Description of Business and Organization Vroom, Inc., through its wholly owned subsidiaries (collectively, the "Company”), is a leading automotive finance company that offers vehicle financing to consumers through third-party dealers and an artificial intelligence ("AI")-powered analytics and digital services platform for automotive retail. In January 2021, the Company completed the acquisition of Vast Holdings, Inc. (d/b/a CarStory). On February 1, 2022 (the "Acquisition Date"), the Company completed the acquisition of Unitas Holdings Corp. (now known as Vroom Finance Corporation), including its wholly owned subsidiaries United PanAm Financial Corp. (now known as Vroom Automotive Financial Corporation) and United Auto Credit Corporation ("UACC"). The Company was incorporated in Delaware on January 31, 2012 under the name BCM Partners III, Corp. On June 25, 2013, the Company changed its name to Auto America, Inc. and on July 9, 2015, the Company changed its name to Vroom, Inc. Value Maximization Plan The Company was previously an end-to-end ecommerce platform to buy and sell used vehicles. On January 22, 2024, the Company announced that its Board of Directors ("Board") had approved a Value Maximization Plan, pursuant to which the Company discontinued its ecommerce operations and wound down its used vehicle dealership business in order to preserve liquidity and enable the Company to maximize stakeholder value through its remaining businesses. The Company ceased transacting through vroom.com, completed transactions for customers who had previously contracted with the Company to purchase or sell a vehicle, halted purchases of additional vehicles, sold its used vehicle inventory through wholesale channels, paid off its vehicle floorplan financing facility dated November 4, 2022 with Ally Bank and Ally Financial Inc. (the "2022 Vehicle Floorplan Facility") and conducted a reduction-in-force commensurate with the reduced operations. As of March 29, 2024, the Company substantially completed the wind-down of its ecommerce operations and used vehicle dealership business (the "Ecommerce Wind-Down"). The Company owns and operates UACC, a leading automotive finance company that offers vehicle financing to consumers through third-party dealers under the UACC brand, and CarStory, an AI-powered analytics and digital services platform for automotive retail. The UACC and CarStory businesses continue to serve their third-party customers, with their operations substantially unaffected by the Ecommerce Wind-Down. The accounting requirements for reporting the Company's ecommerce operations and used vehicle dealership business as a discontinued operation were met as of March 29, 2024. Accordingly, the condensed consolidated financial statements and notes to the condensed consolidated financial statements reflect the results of the Company's ecommerce operations and used vehicle dealership business as a discontinued operation for the periods presented. Refer to Note 5 — Discontinued Operations for further detail. The Company is now organized into two reportable segments: UACC and CarStory. The UACC reportable segment represents UACC’s operations with its network of third-party dealership customers, including the purchase and servicing of vehicle retail installment sales contracts. Prior to the Ecommerce Wind-Down, UACC also offered vehicle financing to Vroom’s customers through its ecommerce platform; the UACC reportable segment also includes the runoff of these previously originated contracts. The CarStory reportable segment represents sales of AI-powered analytics and digital services to automotive dealers, automotive financial services companies and others in the automotive industry. Refer to Note 15 — Segment Information for further detail. Reverse Stock Split On February 13, 2024, the Company effected a 1-for-80 reverse stock split of the Company’s common stock. All shares of the Company’s common stock, stock-based instruments and per-share data included in these condensed consolidated financial statements have been retroactively adjusted as though the stock split has been effected prior to all periods presented. Restructuring Support Agreement and Anticipated Prepackaged Chapter 11 Case On November 12, 2024, the Company entered into a Restructuring Support Agreement (together with all exhibits and schedules thereto, the “RSA”) with creditors holding, over 80% of the aggregate outstanding principal amount of the Notes (as defined in Note 10, Long Term Debt) and the largest shareholder. The RSA contemplates a comprehensive restructuring of the Company’s debt obligations and capital structure to be implemented through a prepackaged plan of reorganization (the “Plan”) to be implemented through the anticipated filing of the Prepackaged Chapter 11 Case (as defined below). Capitalized terms used in this section but not defined herein have the meanings ascribed to them in the RSA. Vroom, Inc. (in the context of the anticipated Prepackaged Chapter 11 Case, the “Debtor”) is expected to commence a voluntary proceeding (the “Prepackaged Chapter 11 Case”) under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas (the “Bankruptcy Court”). The Debtor plans to operate its business as a “debtor-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court. The Debtor plans to seek approval of certain “first day” motions containing customary relief intended to assure the Debtor’s ability to continue its ordinary course operations. None of Vroom, Inc.’s subsidiaries are expected to commence Chapter 11 proceedings. Commitments and Representations. Each of the Debtor and the Consenting Stakeholders have made certain customary commitments and representations in the RSA. The Debtor has agreed, among other things, to support and take all commercially reasonable actions necessary and appropriate to facilitate the restructuring and meet milestones set forth in the RSA. The Consenting Stakeholders have committed to the Debtor, among other things, to support and vote for the Plan and use their commercially reasonable efforts to consummate and complete the restructuring. Milestones. The RSA contains milestones ("Milestones") relating to the progress of the Prepackaged Chapter 11 Case, which include, among other things, entry of an order by the Bankruptcy Court, confirming the Plan and approving the related disclosure statement no later than 60 days following the Petition Date and the occurrence of the date on which the Plan has become effective in accordance with its terms (the “Plan Effective Date”) no later than 75 days following the Petition Date. Termination. Each of the parties to the RSA may terminate the agreement (and thereby their support for the Plan) under certain limited circumstances, including, among other things: (i) in the case of the Company and the Consenting Noteholders, the failure to meet the Milestones; (ii) the occurrence of certain breaches of the RSA; (iii) the mutual agreement of the parties; and (iv) in the case of the Company, if the Board, members, or managers, as applicable, of the Company reasonably determines in good faith and based upon advice of outside legal counsel that performance under the RSA would be inconsistent with its applicable fiduciary duties. Consummation. Consummation of the restructuring contemplated by the RSA is subject to approval of the Plan by the Bankruptcy Court and other conditions. Accordingly, no assurance can be given that the transactions described therein will be consummated. Summary of Material Terms. The following is a summary of the material terms of the restructuring that are set forth in the Plan: • The capital structure of the reorganized Debtor upon the Plan Effective Date will consist of the new common stock to be issued by the reorganized Debtor on the Plan Effective Date (the “New Common Stock”), distributed to (a) the holders of Unsecured Notes Claims; and (b) the holders of Existing Equity Interests, and resulting in pro forma ownership percentages of (x) 92.94% of the New Common Stock held by the holders of Unsecured Notes Claims; and (y) 7.06% of the New Common Stock held by holders of Existing Equity Interests; in each case, subject to dilution by the (i) New Warrants, (ii) the MIP Awards, and (iii) the Post-Effective Date Equity Awards. • Promptly following the Plan Effective Date, the New Board will approve and implement the Management Incentive Plan (the “MIP”). The RSU Awards and the ESO Grants will be granted subject to approval by the New Board, with the allocation of such grants to be determined in good faith by the New Board in consultation with the reorganized company’s chief executive officer. • The reorganized company reserves the right to register the New Warrants with the U.S. Securities and Exchange Commission (“SEC”) by filing a Registration Statement on Form S-1 in its discretion if it determines that doing so would be necessary or desirable in connection with the trading of such securities. As contemplated, the New Warrants will have the following key terms: o Number: The New Warrants will be for the purchase of an aggregate of 1,808,243 shares of New Common Stock, equal to the number of presently existing outstanding shares of common stock of the Company; o Exercise Price: The New Warrants will have an exercise price of $12.19 per share; o Expiration: The New Warrants will expire on the 5th anniversary of the Plan Effective Date; o Anti-Dilution Protections: The New Warrants will contain customary anti-dilution protection for stock splits, stock dividends, and similar events but will not have Black-Scholes protections; and o Transferability: The New Warrants will be freely transferable, subject to applicable securities laws. Under the Plan, certain classes of claims will receive upon consummation the following treatment: • Holders of Other Priority Claims, Secured Claims, General Unsecured Claims, and 510(b) Claims will be unimpaired. • Each holder of Claims under the Unsecured Notes Indenture (the “Unsecured Notes Claims”) will receive, except to the extent that such holder agrees in writing to less favorable treatment, on the Effective Date, its pro rata share of 92.94% of the New Common Stock (subject to dilution by (i) the New Warrants, (ii) the MIP Awards, and (iii) the Post-Effective Date Equity Awards). • Each holder of any Equity Security or other ownership interest in the Debtor as in existence immediately before the Plan Effective Date, but excluding any Existing Equity Awards (the “Existing Equity Interests”), will receive, except to the extent that such holder agrees in writing to less favorable treatment, on the Effective Date, (i) its pro rata share of 7.06% of the New Common Stock (subject to dilution by (a) the New Warrants, (b) the MIP Awards, and (c) the Post-Effective Date Equity Awards) and (ii) the right to receive New Warrants in an amount equal to its pro rata share of Existing Equity Interests. • Except to the extent the holder of any options or restricted stock units representing rights to purchase or acquire any Equity Securities of the Debtor as in existence immediately before the Plan Effective Date (the “Existing Equity Awards,” and together with the Existing Equity Interests, the “Equity Interests”) agrees in writing to less favorable treatment, on the Effective Date, all Existing Equity Awards will be converted into new awards (the “Post-Effective Date Equity Awards”) exchangeable into New Common Stock on the same terms and conditions, and for the same number of units, applicable to the Existing Equity Awards in respect of the Existing Equity Interests, as of immediately prior to the Plan Effective Date. In connection with the restructuring, trade creditors and all other general unsecured creditors are expected to be unimpaired. As described above, the Plan contemplates for the amendment and restatement, subject to approval by the New Board, of the Company’s 2020 Incentive Award Plan in order to implement the MIP, pursuant to which 10% of the New Common Stock (as defined in the Plan) outstanding on a fully diluted basis as of immediately following emergence may be issued in the form of restricted stock unit awards and 5% of the New Common Stock outstanding on a fully diluted basis as of immediately following emergence may be issued in the form of stock options to certain employees of the Debtor, in each case on the terms contemplated by the MIP Term Sheet. Going Concern As described above, the Company is contemplating the filing of the Prepackaged Chapter 11 Case to implement the transactions described herein. Management believes the Company will be able to emerge from bankruptcy and continue to operate as a viable going concern. However, there is no assurance that: (a) the Plan will become effective, (b) the Plan will ultimately be approved by the requisite voting creditors and interest holders and confirmed by the Bankruptcy Court, (c) the Bankruptcy Court will grant or deny motions in a manner that is not adverse to the Debtor, and (d) the anticipated Prepackaged Chapter 11 Case will not be converted into cases under chapter 7 of the Bankruptcy Code. The transactions contemplated by the RSA and Plan are subject to approval by the Bankruptcy Court, among other conditions. Accordingly, management can provide no assurance that the transactions described therein will be consummated. Due to the uncertainties described above, there is substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is contingent upon management's plans, which includes, among other things, its ability to, subject to the approval by the Bankruptcy Court, implement a comprehensive restructuring and successfully emerge from the anticipated Prepackaged Chapter 11 Case. Despite the anticipated Chapter 11 filing, the Company retains sufficient liquidity, with approximately $51.1 million of unrestricted cash on its Condensed Consolidated Balance Sheet as of September 30, 2024, and it continues to meet its obligations to customers, vendors, counterparties and employees in the ordinary course of business. The accompanying unaudited condensed consolidated financial statements have been prepared on the basis that the Company will continue to operate as a going concern, which contemplates that the Company will be able to realize assets and settle liabilities and commitments in the normal course of business for twelve months following the issuance date. Accordingly, the accompanying unaudited condensed consolidated financial statements do not include any adjustments that may result from the outcome of these uncertainties. Basis of Presentation The condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and applicable rules and regulations of the SEC regarding interim financial reporting. The condensed consolidated balance sheet as of December 31, 2023, included herein, was derived from the audited consolidated financial statements as of that date. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes included in the Annual Report on Form 10-K for the year ended December 31, 2023. The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements, and in management’s opinion, include all adjustments, which consist of only normal recurring adjustments necessary for the fair statement of the Company’s condensed consolidated balance sheet as of September 30, 2024 and its results of operations for the three and nine months ended September 30, 2024 and 2023. The results for the three and nine months ended September 30, 2024 are not necessarily indicative of the results expected for the current fiscal year or any other future periods. Certain prior year amounts have been reclassified to conform to the current year presentation related to discontinued operations and new financial statement presentation as a result of the Ecommerce Wind-Down and the reverse stock split. Principles of Consolidation The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

Description of Business and Basis of Presentation

9 Months Ended

Sep. 30, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Description of Business and Basis of Presentation

1. Description of Business and Basis of Presentation

Description of Business and Organization

Vroom, Inc., through its wholly owned subsidiaries (collectively, the "Company”), is a leading automotive finance company that offers vehicle financing to consumers through third-party dealers and an artificial intelligence ("AI")-powered analytics and digital services platform for automotive retail.

In January 2021, the Company completed the acquisition of Vast Holdings, Inc. (d/b/a CarStory). On February 1, 2022 (the "Acquisition Date"), the Company completed the acquisition of Unitas Holdings Corp. (now known as Vroom Finance Corporation), including its wholly owned subsidiaries United PanAm Financial Corp. (now known as Vroom Automotive Financial Corporation) and United Auto Credit Corporation ("UACC").

The Company was incorporated in Delaware on January 31, 2012 under the name BCM Partners III, Corp. On June 25, 2013, the Company changed its name to Auto America, Inc. and on July 9, 2015, the Company changed its name to Vroom, Inc.

Value Maximization Plan

The Company was previously an end-to-end ecommerce platform to buy and sell used vehicles. On January 22, 2024, the Company announced that its Board of Directors ("Board") had approved a Value Maximization Plan, pursuant to which the Company discontinued its ecommerce operations and wound down its used vehicle dealership business in order to preserve liquidity and enable the Company to maximize stakeholder value through its remaining businesses. The Company ceased transacting through vroom.com, completed transactions for customers who had previously contracted with the Company to purchase or sell a vehicle, halted purchases of additional vehicles, sold its used vehicle inventory through wholesale channels, paid off its vehicle floorplan financing facility dated November 4, 2022 with Ally Bank and Ally Financial Inc. (the "2022 Vehicle Floorplan Facility") and conducted a reduction-in-force commensurate with the reduced operations. As of March 29, 2024, the Company substantially completed the wind-down of its ecommerce operations and used vehicle dealership business (the "Ecommerce Wind-Down").

The Company owns and operates UACC, a leading automotive finance company that offers vehicle financing to consumers through third-party dealers under the UACC brand, and CarStory, an AI-powered analytics and digital services platform for automotive retail. The UACC and CarStory businesses continue to serve their third-party customers, with their operations substantially unaffected by the Ecommerce Wind-Down.

The accounting requirements for reporting the Company's ecommerce operations and used vehicle dealership business as a discontinued operation were met as of March 29, 2024. Accordingly, the condensed consolidated financial statements and notes to the condensed consolidated financial statements reflect the results of the Company's ecommerce operations and used vehicle dealership business as a discontinued operation for the periods presented. Refer to Note 5 — Discontinued Operations for further detail. The Company is now organized into two reportable segments: UACC and CarStory. The UACC reportable segment represents UACC’s operations with its network of third-party dealership customers, including the purchase and servicing of vehicle retail installment sales contracts. Prior to the Ecommerce Wind-Down, UACC also offered vehicle financing to Vroom’s customers through its ecommerce platform; the UACC reportable segment also includes the runoff of these previously originated contracts. The CarStory reportable segment represents sales of AI-powered analytics and digital services to automotive dealers, automotive financial services companies and others in the automotive industry. Refer to Note 15 — Segment Information for further detail.

Reverse Stock Split

On February 13, 2024, the Company effected a 1-for-80 reverse stock split of the Company’s common stock. All shares of the Company’s common stock, stock-based instruments and per-share data included in these condensed consolidated financial statements have been retroactively adjusted as though the stock split has been effected prior to all periods presented.

Restructuring Support Agreement and Anticipated Prepackaged Chapter 11 Case

On November 12, 2024, the Company entered into a Restructuring Support Agreement (together with all exhibits and schedules thereto, the “RSA”) with creditors holding, over 80% of the aggregate outstanding principal amount of the Notes (as defined in Note 10, Long Term Debt) and the largest shareholder. The RSA contemplates a comprehensive restructuring of the Company’s debt obligations and capital structure to be implemented through a prepackaged plan of reorganization (the “Plan”) to be implemented through the anticipated filing of the Prepackaged Chapter 11 Case (as defined below). Capitalized terms used in this section but not defined herein have the meanings ascribed to them in the RSA.

Vroom, Inc. (in the context of the anticipated Prepackaged Chapter 11 Case, the “Debtor”) is expected to commence a voluntary proceeding (the “Prepackaged Chapter 11 Case”) under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas (the “Bankruptcy Court”). The Debtor plans to operate its business as a “debtor-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court. The Debtor plans to seek approval of certain “first day” motions containing customary relief intended to assure the Debtor’s ability to continue its ordinary course operations. None of Vroom, Inc.’s subsidiaries are expected to commence Chapter 11 proceedings.

Commitments and Representations. Each of the Debtor and the Consenting Stakeholders have made certain customary commitments and representations in the RSA. The Debtor has agreed, among other things, to support and take all commercially reasonable actions necessary and appropriate to facilitate the restructuring and meet milestones set forth in the RSA. The Consenting Stakeholders have committed to the Debtor, among other things, to support and vote for the Plan and use their commercially reasonable efforts to consummate and complete the restructuring.

Milestones. The RSA contains milestones ("Milestones") relating to the progress of the Prepackaged Chapter 11 Case, which include, among other things, entry of an order by the Bankruptcy Court, confirming the Plan and approving the related disclosure statement no later than 60 days following the Petition Date and the occurrence of the date on which the Plan has become effective in accordance with its terms (the “Plan Effective Date”) no later than 75 days following the Petition Date.

Termination. Each of the parties to the RSA may terminate the agreement (and thereby their support for the Plan) under certain limited circumstances, including, among other things: (i) in the case of the Company and the Consenting Noteholders, the failure to meet the Milestones; (ii) the occurrence of certain breaches of the RSA; (iii) the mutual agreement of the parties; and (iv) in the case of the Company, if the Board, members, or managers, as applicable, of the Company reasonably determines in good faith and based upon advice of outside legal counsel that performance under the RSA would be inconsistent with its applicable fiduciary duties.

Consummation. Consummation of the restructuring contemplated by the RSA is subject to approval of the Plan by the Bankruptcy Court and other conditions. Accordingly, no assurance can be given that the transactions described therein will be consummated.

Summary of Material Terms. The following is a summary of the material terms of the restructuring that are set forth in the Plan:

•

The capital structure of the reorganized Debtor upon the Plan Effective Date will consist of the new common stock to be issued by the reorganized Debtor on the Plan Effective Date (the “New Common Stock”), distributed to (a) the holders of Unsecured Notes Claims; and (b) the holders of Existing Equity Interests, and resulting in pro forma ownership percentages of (x) 92.94% of the New Common Stock held by the holders of Unsecured Notes Claims; and (y) 7.06% of the New Common Stock held by holders of Existing Equity

Interests; in each case, subject to dilution by the (i) New Warrants, (ii) the MIP Awards, and (iii) the Post-Effective Date Equity Awards.

•

Promptly following the Plan Effective Date, the New Board will approve and implement the Management Incentive Plan (the “MIP”). The RSU Awards and the ESO Grants will be granted subject to approval by the New Board, with the allocation of such grants to be determined in good faith by the New Board in consultation with the reorganized company’s chief executive officer.

•

The reorganized company reserves the right to register the New Warrants with the U.S. Securities and Exchange Commission (“SEC”) by filing a Registration Statement on Form S-1 in its discretion if it determines that doing so would be necessary or desirable in connection with the trading of such securities. As contemplated, the New Warrants will have the following key terms:

Number: The New Warrants will be for the purchase of an aggregate of 1,808,243 shares of New Common Stock, equal to the number of presently existing outstanding shares of common stock of the Company;

Exercise Price: The New Warrants will have an exercise price of $12.19 per share;

Expiration: The New Warrants will expire on the 5th anniversary of the Plan Effective Date;

Anti-Dilution Protections: The New Warrants will contain customary anti-dilution protection for stock splits, stock dividends, and similar events but will not have Black-Scholes protections; and

Transferability: The New Warrants will be freely transferable, subject to applicable securities laws.

Under the Plan, certain classes of claims will receive upon consummation the following treatment:

•

Holders of Other Priority Claims, Secured Claims, General Unsecured Claims, and 510(b) Claims will be unimpaired.

•

Each holder of Claims under the Unsecured Notes Indenture (the “Unsecured Notes Claims”) will receive, except to the extent that such holder agrees in writing to less favorable treatment, on the Effective Date, its pro rata share of 92.94% of the New Common Stock (subject to dilution by (i) the New Warrants, (ii) the MIP Awards, and (iii) the Post-Effective Date Equity Awards).

•

Each holder of any Equity Security or other ownership interest in the Debtor as in existence immediately before the Plan Effective Date, but excluding any Existing Equity Awards (the “Existing Equity Interests”), will receive, except to the extent that such holder agrees in writing to less favorable treatment, on the Effective Date, (i) its pro rata share of 7.06% of the New Common Stock (subject to dilution by (a) the New Warrants, (b) the MIP Awards, and (c) the Post-Effective Date Equity Awards) and (ii) the right to receive New Warrants in an amount equal to its pro rata share of Existing Equity Interests.

•

Except to the extent the holder of any options or restricted stock units representing rights to purchase or acquire any Equity Securities of the Debtor as in existence immediately before the Plan Effective Date (the “Existing Equity Awards,” and together with the Existing Equity Interests, the “Equity Interests”) agrees in writing to less favorable treatment, on the Effective Date, all Existing Equity Awards will be converted into new awards (the “Post-Effective Date Equity Awards”) exchangeable into New Common Stock on the same terms and conditions, and for the same number of units, applicable to the Existing Equity Awards in respect of the Existing Equity Interests, as of immediately prior to the Plan Effective Date.

In connection with the restructuring, trade creditors and all other general unsecured creditors are expected to be unimpaired.

As described above, the Plan contemplates for the amendment and restatement, subject to approval by the New Board, of the Company’s 2020 Incentive Award Plan in order to implement the MIP, pursuant to which 10% of the New Common Stock (as defined in the Plan) outstanding on a fully diluted basis as of immediately following emergence may be issued in the form of restricted stock unit awards and 5% of the New Common Stock outstanding on a fully diluted basis as of immediately following emergence may be issued in the form of stock options to certain employees of the Debtor, in each case on the terms contemplated by the MIP Term Sheet.

Going Concern

As described above, the Company is contemplating the filing of the Prepackaged Chapter 11 Case to implement the transactions described herein. Management believes the Company will be able to emerge from bankruptcy and continue to operate as a viable going concern. However, there is no assurance that: (a) the Plan will become effective, (b) the Plan will ultimately be approved by the requisite voting creditors and interest holders and confirmed by the Bankruptcy Court, (c) the Bankruptcy Court will grant or deny motions in a manner that is not adverse to the Debtor, and (d) the anticipated Prepackaged Chapter 11 Case will not be converted into cases under chapter 7 of the Bankruptcy Code. The transactions contemplated by the RSA and Plan are subject to approval by the Bankruptcy Court, among other conditions. Accordingly, management can provide no assurance that the transactions described therein will be consummated.

Due to the uncertainties described above, there is substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is contingent upon management's plans, which includes, among other things, its ability to, subject to the approval by the Bankruptcy Court, implement a comprehensive restructuring and successfully emerge from the anticipated Prepackaged Chapter 11 Case. Despite the anticipated Chapter 11 filing, the Company retains sufficient liquidity, with approximately $51.1 million of unrestricted cash on its Condensed Consolidated Balance Sheet as of September 30, 2024, and it continues to meet its obligations to customers, vendors, counterparties and employees in the ordinary course of business.

The accompanying unaudited condensed consolidated financial statements have been prepared on the basis that the Company will continue to operate as a going concern, which contemplates that the Company will be able to realize assets and settle liabilities and commitments in the normal course of business for twelve months following the issuance date. Accordingly, the accompanying unaudited condensed consolidated financial statements do not include any adjustments that may result from the outcome of these uncertainties.

Basis of Presentation

The condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and applicable rules and regulations of the SEC regarding interim financial reporting. The condensed consolidated balance sheet as of December 31, 2023, included herein, was derived from the audited consolidated financial statements as of that date. Certain information and note disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes included in the Annual Report on Form 10-K for the year ended December 31, 2023.

The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements, and in management’s opinion, include all adjustments, which consist of only normal recurring adjustments necessary for the fair statement of the Company’s condensed consolidated balance sheet as of September 30, 2024 and its results of operations for the three and nine months ended September 30, 2024 and 2023. The results for the three and nine months ended September 30, 2024 are not necessarily indicative of the results expected for the current fiscal year or any other future periods. Certain prior year amounts have been reclassified to conform to the current year presentation related to discontinued operations and new financial statement presentation as a result of the Ecommerce Wind-Down and the reverse stock split.

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.