NextPlat Corp (NXPL) as of December 31, 2025 presents a negative liquidation recovery posture to equity. Total reported assets are $27.5M against total liabilities of $10.0M, yielding GAAP book equity of approximately $17.4M. However, applying liquidation haircuts materially compresses recoverable value. Cash of $13.7M recovers at 100% ($13.7M). Net AR of $4.0M at 90-95% recovers approximately $3.6-3.8M. Inventory net of reserves of $3.4M at 60% recovers approximately $2.0M. PP&E net of $2.5M at 50-70% recovers approximately $1.3-1.8M. Intangibles net of $0.4M and goodwill of $0.2M recover at 0% under liquidation convention. The ROU asset of $0.2M is excluded as the corresponding lease liability remains on the liability stack at face value. Aggregate recoverable assets approximate $20.6-21.3M before any distressed-sale compression. Against this, liabilities at face value total $10.0M: current liabilities of $9.1M (including $5.8M accounts payable, $0.3M accrued wages, $1.75M litigation reserve, $1.3M other current items) plus non-current liabilities of approximately $0.9M (long-term notes payable $0.9M, operating lease non-current $0.04M). The $1.75M litigation accrual for the Weisberg class action (Delaware Chancery, Case No. 24-1097-MTZ) is carried at management's estimate representing the D&O insurance retention; actual exposure is unquantified and could materially exceed this figure, as management acknowledges. The litigation also involves unresolved indemnification questions following the death of former CEO Fernandez. Total liquidation recovery to equity is marginally positive in base case but directionally zero to negative once litigation tail risk, winding-down costs, and transaction friction are factored. The MFFAIS CLV of $4.5M versus the OLV of $12.0M reflects this compression. Year-over-year, total assets declined from $37.1M (December 31, 2024) to $27.5M (December 31, 2025), a $9.6M reduction, driven primarily by cash burn ($6.3M net decrease) and the absence of goodwill/intangible impairment charges that reduced the 2024 asset base in accounting terms but had already been taken ($13.7M goodwill impairment in 2024). The deferred tax asset of $18.0M gross is fully reserved via a $18.0M valuation allowance and contributes zero liquidation value. The company carries a $46.6M NOL carryforward, of which the Progressive Care LLC portion ($16.5M) has not been analyzed under IRC Section 382 for ownership-change limitations, adding further uncertainty to any tax-attribute value in a sale or wind-down scenario. Operating lease liability is substantially reduced year-over-year ($842K at December 31, 2024 to $199K at December 31, 2025) following early termination of the Florida office lease and natural lease runoff, reducing the forward liability stack. Finance lease obligations are fully extinguished. The filing discusses the accrued litigation contingency for the Weisberg matter in MD&A but the $1.75M accrual is separately tagged in XBRL as LitigationReserveCurrent.
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