Item 1.01. Entry into a Material Definitive Agreement.
On March 27, 2020, XpresSpa Group, Inc.,
a Delaware corporation (the “Company”), entered into a Securities Purchase Agreement (the “Purchase Agreement”)
with certain purchasers named therein (the “Purchasers”), pursuant to which the Company agreed to issue and sell,
in a registered direct offering, (i) 7,895,000 shares of the Company’s common stock, par value $0.01 per share (the “Common
Stock”) at an offering price of $0.20 per share and (ii) an aggregate of 2,105,000 pre-funded warrants exercisable for shares
of Common Stock (the “Pre-Funded Warrants”) at an offering price of $0.19 per Pre-Funded Warrant (the offering of
the shares of Common Stock and the Pre-Funded Warrants, the “Offering”). The closing of the Offering is expected to
occur on or about March 30, 2020, subject to customary closing conditions. The Company expects to receive gross proceeds of approximately
$2.0 million in connection with the Offering, before deducting financial advisory consultant fees and related offering expenses.
The Pre-Funded Warrants are being sold
to the Purchasers to the extent that a Purchaser’s subscription of shares of Common Stock in the Offering would otherwise
result in the Purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99% (or, in
certain cases, 9.99%) of the Company’s outstanding Common Stock immediately following the consummation of the Offering, in
lieu of shares of Common Stock. Each Pre-Funded Warrant represents the right to purchase one share of Common Stock at an exercise
price of $0.01 per share. The Pre-Funded Warrants are exercisable immediately and may be exercised at any time until the Pre-Funded
Warrants are exercised in full.
The
Purchase Agreement contains customary representations and warranties and agreements of the Company and the Purchasers
and customary indemnification rights and obligations of the parties.
Pursuant
to a letter agreement, dated March 19, 2020 (the “Letter Agreement”), the Company engaged Palladium Capital Advisors,
LLC (“Palladium”) as advisory financial consultant. The Company agreed to pay to Palladium a cash fee of 8% of the
aggregate gross proceeds raised in the Offering.
The foregoing summaries of the Letter Agreement,
the Purchase Agreement and the Pre-Funded Warrants do not purport to be complete and are subject to, and qualified in their entirety
by, such documents attached as Exhibits 1.1, 10.1 and 4.1, respectively, to this Current Report on Form 8-K, which are incorporated
herein by reference.
On March 27, 2020, the Company issued a
press release in connection with the Offering, which is attached as Exhibit 99.1 hereto and incorporated by reference herein.
The securities in Offering are being offered
by the Company pursuant to a registration statement on Form S-3 (File No. 333- 232764),
which was filed with the Securities and Exchange Commission (the “Commission”) on July 22, 2019 and was declared effective
by the Commission on July 30, 2019 (the “Registration Statement”). A copy
of the opinion of Mintz, Levin, Cohn, Ferris, Glovsky & Popeo, P.C. relating to the legality of the issuance and sale of the
securities in the Offering is attached to this report as Exhibit 5.1. This Current Report on Form 8-K shall not constitute an offer
to sell or the solicitation of an offer to buy securities, nor shall there be any sale of securities in any state in which such
offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.