Form 8-K - Current report

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

 

Date of Report (Date of earliest event reported): September 25, 2024

 

La Rosa Holdings Corp.

(Exact name of registrant as specified in its charter)

 

Nevada		001-41588		87-1641189
(State or other jurisdiction of incorporation)		(Commission File Number)		(I.R.S. Employer Identification No.)

 

1420 Celebration Blvd., 2nd Floor Celebration, Florida		34747
(Address of principal executive offices)		(Zip Code)

 

Registrant’s telephone number, including area code: [phone]

 

N/A

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.0001 par value		LRHC		The Nasdaq Stock Market LLC

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company ☒

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ 

 

 

 

 

 

 

Item 1.01. Entry into a Material Definitive Agreement.

 

Global Amendment to the Notes

 

On September 25, 2024, La Rosa Holdings Corp., a Nevada corporation (the “Company”), and an institutional accredited investor (the “Holder”), entered into that certain Global Amendment (the “Amendment”) to that certain senior secured promissory note in the original principal amount of $1,052,631.58 dated on or around February 20, 2024 (the “First Note”), to that certain senior secured promissory note in the original principal amount of $1,316,000.00 dated on or around April 1, 2024 (the “Second Note”), and to that certain senior secured promissory note in the original principal amount of $468,000.00 dated on or around July 16, 2024 (the “Third Note”, and collectively with the First Note and Second Note, the “Notes”).

 

Pursuant to the Amendment, the parties agreed that:

 

(i)

the maturity date of the Notes shall be amended to August 1, 2025,

 

(ii)

the Company shall pay $200,000.00 in cash to the Holder on or before September 30, 2024, which among shall reduce an outstanding balance under the First Note,

 

(iii)

in lieu of all the payments currently required under the Notes, starting February 1, 2025, the Company shall pay to the Holder $250,000.00 monthly towards the repayment of the Notes, with the remaining balance of the Notes due on the August 1, 2025, each of such payments to be applied to the Third Note until it is fully repaid, then to the Second Note until it is fully repaid, and then to the First Note;

 

(iv)

beginning September 25, 2024, the Holder shall not effectuate any conversion(s) of the Notes into common stock of the Company unless (i) the Company fails to comply with the terms of the Amendment or (ii) there is an event of default under any of the Notes.

 

The parties to the Amendment also agreed that, as a condition to the effectiveness of the Amendment, on or before September 30, 2024, Celebration Corporate Center, LLC will guarantee all of the payment obligations under the Notes.

 

1

 

 

Promissory Note:

 

On September 27, 2024, the Company issued to an unaffiliated private investor (the “Investor”) a promissory note (“Promissory Note”) in the principal amount of $200,000. Interest accrues on the principal amount at 12.5% per annum. The Promissory Note shall be repaid in three monthly installments beginning on November 1, 2024. The Company may prepay this loan at any time without penalty, any prepayment will reduce the amount of interest owed on the Promissory Note.

 

The preceding description of the Amendment and the Promissory Note purport to be a summary only and is qualified in its entirety by reference to the full text of such documents, copies of which are filed as Exhibits 4.1 and 4.2, respectively, to this Current Report on Form 8-K and incorporated herein by reference.

 

2

 

 

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

 

The information outlined in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.

 

Item 3.02. Unregistered Sales of Equity Securities.

 

The disclosure under Item 1.01 of this Current Report on Form 8-K is incorporated hereby reference.

 

The Company issued the Promissory Note to the Investor pursuant to the exemption from the registration requirements of the Securities Act available to the Company under Section 4(a)(2) and/or Rule 506(b) promulgated thereunder due to the fact that the issuance did not involve a public offering of securities.

 

Item 7.01 Regulation FD Disclosure. 

 

On September 26, 2024, the Company issued a press release announcing signing of the Amendment described in Item 1.01 of this Current Report on Form 8-K. The press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

 

The information furnished pursuant to this Item 7.01, including Exhibit 99.1 hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that section, nor shall it be deemed to be incorporated by reference in any filing made by the Company under the Securities Act or the Exchange Act, except as otherwise expressly set forth by specific reference in such filing.

 

Item 9.01. Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit No.		Description
4.1		Form of Global Amendment.
4.2		Form of Promissory Note.
99.1		Press Release issued by the Company on September 26, 2024.
104		Cover Page Interactive Data File (embedded with the Inline XBRL document).

 

 

3

 

 

SIGNATURES

 

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

 

Date: October 1, 2024	LA ROSA HOLDINGS CORP.
	By:	/s/ Joseph La Rosa
	Name:	Joseph La Rosa
	Title:	Chief Executive Officer

 

 

4

 

 

Exhibit 4.1

 

GLOBAL AMENDMENT TO THE NOTES

 

THIS GLOBAL AMENDMENT to the Notes (as defined below) (the “Amendment”) is entered into as of September 25, 2024 (the “Effective Date”), by and between LA ROSA HOLDINGS CORP., a Nevada corporation (the “Company”), and Mast Hill Fund, L.P., a Delaware limited partnership (the “Holder”) (collectively the “Parties”).

 

BACKGROUND

 

A. The Company and Holder are the parties to that certain senior secured promissory note in the original principal amount of $1,052,631.58 dated on or around February 20, 2024 (the “First Note”); and

 

B. The Company and Holder are the parties to that certain senior secured promissory note in the original principal amount of $1,316,000.00 dated on or around April 1, 2024 (the “Second Note”); and

 

C. The Company and Holder are the parties to that certain senior secured promissory note in the original principal amount of $468,000.00 dated on or around July 16, 2024 (the “Third Note”, and collectively with the First Note and Second Note, the “Notes”); and

 

D. The Parties desire to amend the Notes as set forth expressly below.

 

NOW THEREFORE, in consideration of the execution and delivery of the Amendment and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

 

1. The “Maturity Date” (as defined in the Notes) of the Notes shall be amended to August 1, 2025.

 

2. The Company shall pay $200,000.00 in cash to the Holder on or before September 30, 2024. Such payment shall be applied to and reduce the outstanding balance under the First Note. The Holder hereby waives the requirements of Section 1.9 of the First Note and the requirements of Sections 1.10 of the Second Note and the Third Note with respect to this payment.

 

3. In lieu of all the payments currently required under Section 4.16 of the Notes, the Company shall instead pay $250,000.00 to Holder on February 1, 2025, as well as $250,000.00 to Holder on the first calendar day of each calendar month thereafter, towards the repayment of the Notes, with the remaining balance of the Notes due on the Maturity Date. Each of the aforementioned payments shall be deemed an “Amortization Payment” under each of the Notes. Each of the aforementioned payments shall first be applied to the Third Note until the Third Note is repaid in the entirety, following which such payments shall be applied to the Second Note until the Second Note is repaid in the entirety, following which such payments shall be applied to the First Note. In no event the repayment of the Notes, as described herein, shall constitute an Event of Default under any of the Notes.

 

4. Beginning on the date of this Amendment, the Holder shall not effectuate any conversion(s) of the Notes into common stock of the Company unless (i) the Company fails to comply with the terms of this Amendment or (ii) an Event of Default (as defined in each of the Notes) occurs under any of the Notes. The Parties hereby agree that in no event a forbearance on conversion of the Notes described herein shall constitute an Event of Default under any of the Notes.

 

5. If, on or before September 30, 2024, all of the payment obligations under the Notes are not guaranteed by Celebration Corporate Center, LLC, a Florida limited liability company, pursuant to a guaranty and security agreement  in form acceptable to the Holder in Holder’s sole discretion, which shall include a security interest in the property located at 1420 Celebration Blvd, Suite 201-258, Celebration, FL, 34747, then this Amendment shall be null and void and of no further force or effect.

 

6. If an Event of Default (as defined in each of the Notes) occurs under any of the Notes, this Amendment shall be null and void and of no further force or effect.

 

7. Section 4.6 of the Third Note shall apply to this Amendment.

 

8. This Amendment may be executed in two or more counterparts, each of which when so executed and delivered to the other party shall be deemed an original. The executed page(s) from each original may be joined together and attached to one such original and shall thereupon constitute one and the same instrument. Such counterparts may be delivered via facsimile, electronic mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

 

9. This Amendment shall be deemed part of, but shall take precedence over and supersede any provisions to the contrary contained in the Notes. Except as specifically modified hereby, all of the provisions of the Notes, which are not in conflict with the terms of this Amendment, shall remain in full force and effect.

 

[Signature page to follow]

 

 

 

  

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first above written.

 

LA ROSA HOLDINGS CORP.			Mast Hill Fund, L.P.
By:			By:
Name:	Joseph La Rosa		Name:	Patrick Hassani
Title:	Chief Executive Officer		Title:	Chief Investment Officer

 

 

 

 

Exhibit 4.2

 

Promissory Note

 

Date: September 27, 2024

 

Lender: Hilary Auerbach

Borrower: La Rosa Holdings Corp.

Loan Amount: $200,000

Interest Rate: 12.5% annually

 

Terms and Conditions:

 

1.

Loan Disbursement:

The Lender agrees to loan the Borrower $200,000 on September 26, 2024.

 

2.

Interest:

Interest on the loan will accrue at an annual rate of 12.5%, calculated based on the outstanding principal balance.

 

3.

Repayment Schedule:

The Borrower agrees to make three monthly payments of $75,000, beginning on November 1, 2024, with subsequent payments due on December 1, 2024, and January 1, 2025. The payments include both Principal and Interest.

 

4.

Total Repayment:

The Borrower will repay a total of $225,000. This total includes $200,000 in principal and $25,000 in interest. After the payment on January 1, 2025, the Borrower’s obligation under this note will be fully satisfied.

 

5.

Final Payment Date:

The last payment under this note is due on January 1, 2025, at which point the full amount of $225,000 (Principal + Interest) will have been repaid.

 

6.

Prepayment:

The Borrower may prepay this loan at any time without penalty. Any prepayment will reduce the amount of interest owed on the loan.

 

 

 

 

7.

Personal Guarantee:

CEO and Founder of La Rosa Holdings, Joseph A. La Rosa, personally guarantees this loan, meaning that Mr. La Rosa’s personal assets may be used to satisfy the debt if the Borrower fails to fulfill the obligations outlined in this note. The Borrower acknowledges that this guarantee is unconditional and irrevocable until the full loan amount and accrued interest are paid.

 

8.

Governing Law:

This note shall be governed by and construed in accordance with the laws of Florida. Signatures:

 

Lender’s Signature
Date:
Borrower’s Signature
Date:

 

 

 

 

Exhibit 99.1

 

 

 

La Rosa Holdings Announces Debt Restructuring; Conversion Rights Halted and Principal & Interest Payments Deferred Until February 2025

 

Restructuring benefits financial position and reduces debt under the notes by approximately 9.5%

 

Reaffirms target of $100 million annualized revenue exit run rate for 2024,
with profitability expected in 2025

 

Celebration, FL – September 26, 2024 – La Rosa Holdings Corp. (NASDAQ: LRHC) (“La Rosa” or the “Company”), a holding company for six agent-centric, technology-integrated, cloud-based, multi-service real estate segments, today announced that it has entered into an amendment with its noteholder to restructure debt under three outstanding notes issued to the holder in February, April, and July 2024. As part of the amendment, the Company agreed to repay to the holder $200,000 of the debt under the notes, and all principal and interest payments under the notes have been deferred until February 1, 2025. Starting February 1, 2025, the Company will pay monthly payments to the holder, which shall be first applied to the July note until it is repaid in the entirety, and then to the April note until it is repaid in the entirety, following which such payments shall be applied to the February note. Additionally, maturity dates under all three notes were extended to August 1, 2025, and the holder agreed not to effectuate any conversions of the notes unless the Company fails to comply with the amendment or there is an event of default under the notes. The Company believes that this strategic restructuring strengthens the Company’s financial position by reducing total debt under the notes by approximately 9.5%, providing greater financial flexibility to pursue growth initiatives and long-term objectives.

 

Joe La Rosa, CEO of La Rosa Holdings, commented, “We believe that this debt restructuring is an important step in strengthening our financial foundation as we accelerate our growth momentum. By consolidating payments under the outstanding notes, deferring principal and interest payments until February 2025 and the holder agreeing to halt conversions of the notes, we are significantly improving our financial position. This not only reduces our debt under the notes by approximately 9.5%, but also provides us with the flexibility to reinvest in the business, focus on expansion, and execute our strategic acquisition plans.”

 

“We have additional acquisitions that we hope to close by the end of the year, which we plan to primarily fund with stock. We believe this strategy will allow us to expand our market footprint while minimizing additional debt. Additionally, as previously announced over 400 new agents onboarded since June 1, 2024. We believe that this fact demonstrates our ability to scale effectively, driven by our agent-centric, technology-integrated model. Within the next six months, we expect the Company to be in a significantly stronger position, with improvements in both our top and bottom lines through targeted acquisitions and organic growth. We aim at achieving an annualized revenue run rate of $100 million by the end of 2024 and reaching profitability in 2025, assuming that all of our planned acquisitions are consummated before the end of 2024. Our team is fully committed to delivering long-term value for our shareholders, and this restructuring positions us to capitalize on new opportunities as we continue to scale,” concluded Mr. La Rosa.

 

 

 

 

About La Rosa Holdings Corp.

 

La Rosa Holdings Corp. (Nasdaq: LRHC) is disrupting the real estate industry by offering agents a choice between a revenue share model or an annual fee-based model with 100% agent commissions. Leveraging its proprietary technology platform, La Rosa empowers agents and franchisees to deliver top-tier service to their clients. The Company provides both residential and commercial real estate brokerage services and offers technology-based products and services to its sales agents and franchise agents.

 

La Rosa’s business model is structured around internal services for agents and external services for the public, including residential and commercial real estate brokerage, franchising, real estate brokerage education and coaching, and property management. The Company has 24 La Rosa Realty corporate real estate brokerage offices and branches located in Florida, California, Texas, Georgia, and Puerto Rico. The Company also has 13 La Rosa Realty franchised real estate brokerage offices and branches and two affiliated real estate brokerage offices in the United States and Puerto Rico. 

 

For more information, please visit: https://www.larosaholdings.com.

 

Stay connected with La Rosa, sign up for news alerts here: larosaholdings.com/email-alerts.

 

Forward-Looking Statements

 

This press release contains forward-looking statements regarding the Company’s current expectations that are subject to various risks and uncertainties. Such statements include statements regarding the Company’s ability to grow its business and other statements that are not historical facts, including statements which may be accompanied by the words “intends,” “may,” “will,” “plans,” “expects,” “anticipates,” “projects,” “predicts,” “estimates,” “aims,” “believes,” “hopes,” “potential” or similar words. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Actual results could differ materially from those described in these forward-looking statements due to certain factors, including without limitation, the Company’s ability to achieve profitable operations, our ability to successfully integrate acquisitions into our business operations, customer acceptance of new services, the demand for the Company’s services and the Company’s customers’ economic condition, the impact of competitive services and pricing, general economic conditions, the successful integration of the Company’s past and future acquired brokerages, the effect of the recent National Association of Realtors’ landmark settlement on our business operations, and other risk factors detailed in the Company’s filings with the United States Securities and Exchange Commission (the “SEC”). You are urged to carefully review and consider any cautionary statements and other disclosures, including the statements made under the heading “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, and other reports and documents that we file from time to time with the SEC, including our Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2024. Forward-looking statements contained in this press release are made only as of the date of this press release, and La Rosa does not undertake any responsibility to update any forward-looking statements in this release, except as may be required by applicable law. References and links to websites have been provided as a convenience, and the information contained on such websites has not been incorporated by reference into this press release.

 

For more information, contact: [e-mail]

 

Investor Relations Contact:

Crescendo Communications, LLC

David Waldman/Natalya Rudman

Tel: [phone]

Email: [e-mail]

 

 

 

 

 

Cover	Sep. 25, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Sep. 25, 2024
Entity File Number	001-41588
Entity Registrant Name	La Rosa Holdings Corp.
Entity Central Index Key	0001879403
Entity Tax Identification Number	87-1641189
Entity Incorporation, State or Country Code	NV
Entity Address, Address Line One	1420 Celebration Blvd
Entity Address, Address Line Two	2nd Floor
Entity Address, City or Town	Celebration
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	34747
City Area Code	321
Local Phone Number	250-1799
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $0.0001 par value
Trading Symbol	LRHC
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	false

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