La Rosa Holdings (NASDAQ: LRHC) issues Series D convertible preferred financing
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
La Rosa Holdings Corp. entered a Securities Purchase Agreement with an institutional investor to issue up to 500 shares of Series D Convertible Preferred Stock at $1,000 per share. The parties will initially close on 250 shares for aggregate proceeds of $250,000, with a remaining 250 shares issuable at the investor’s option after the company files its Form 10-K for the year ended December 31, 2025.
The Series D Preferred bears no dividends and has limited voting rights, mainly on actions that could adversely affect its terms. It is convertible into common stock at a Conversion Price of $1.58 per share or an Alternate Conversion Price based on 90% of the lowest 10-day VWAP, subject to a 9.99% beneficial ownership cap. La Rosa may redeem all outstanding Series D shares at a price tied to the greater of the Conversion Amount or the highest recent closing sale price calculation.
Positive
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Negative
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8-K Event Classification
4 items: 1.01, 3.02, 5.03, 9.01
4 items
Item 1.01
Entry into a Material Definitive Agreement
Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 3.02
Unregistered Sales of Equity Securities
Securities
The company sold equity securities in a private placement or other unregistered transaction.
Item 5.03
Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year
Governance
The company amended its charter documents, bylaws, or changed its fiscal year.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Initial Series D issuance: 250 shares, $1,000/share
Maximum Series D capacity: 500 shares, $1,000/share
Conversion Price: $1.58 per share
+4 more
7 metrics
Initial Series D issuance
250 shares, $1,000/share
Closed on May 27, 2026 for aggregate $250,000
Maximum Series D capacity
500 shares, $1,000/share
Up to $500,000 total purchase price under SPA
Conversion Price
$1.58 per share
Fixed Conversion Price option for Series D conversion
Beneficial ownership cap
9.99%
Maximum Percentage a holder can own post-conversion
VWAP discount factor
90% of lowest 10-day VWAP
Component of Alternate Conversion Price formula
Alternate Conversion multipliers
105% / 125%
Conversion Amount multiplier for Change of Control / other cases
Exemption used
Rule 506(b) of Regulation D
Unregistered sale of Series D Preferred Stock
Key Terms
Series D Convertible Preferred Stock, Conversion Price, Alternate Conversion Price, VWAP, +2 more
6 terms
Series D Convertible Preferred Stock financial
"the Company will issue to the Investor up to 500 shares of the Company’s Series D Convertible Preferred Stock"
Series D convertible preferred stock is a class of shares issued in a later-stage funding round that gives holders priority over common shareholders for payouts and often a fixed dividend, while including an option to convert those shares into common stock. It matters to investors because it affects who gets paid first if a company is sold or liquidates and can change ownership stakes and voting power when converted, similar to holding a safer ticket that can be exchanged for regular tickets later.
Conversion Price financial
"“Conversion Price”, as of any date of determination and subject to adjustment as provided therein"
The conversion price is the fixed price at which a convertible security, like a bond or preferred stock, can be exchanged for shares of common stock. It acts like a set rate that determines how many shares an investor can receive if they choose to convert their investment. This helps investors understand the value and potential benefits of converting their securities into company shares.
Alternate Conversion Price financial
"As used herein, “Alternate Conversion Price” means the lowest of (i) the applicable Conversion Price"
VWAP financial
"90% of the lowest VWAP (as defined in the Certificate of Designation) of the Common Stock"
VWAP, or Volume-Weighted Average Price, is a way to find the average price of a stock throughout the trading day, giving more importance to times when more shares are traded. It helps traders see the typical price and decide whether a stock is expensive or cheap compared to its average, similar to finding the average speed during a trip by giving more weight to times when you traveled faster or slower.
Floor Price financial
"the greater of (x) the “Floor Price” (as defined in the COD and as adjusted for stock splits"
The floor price is the minimum price at which a security, asset, or offering will be sold or accepted, acting like a seller’s “bottom line” or a reserve in an auction. For investors it matters because it sets a visible downside limit and can influence trading, valuation, and expectations of risk—like knowing there’s a safety net that a sale won’t go below a set level.
Regulation D regulatory
"pursuant to the exemption from the registration requirements of the Securities Act available to the Company under Rule 506(b) under Regulation D"
Regulation D is a set of rules that govern how companies can raise money from investors without going through the full process required for public stock offerings. It provides simplified options for private placements, making it easier for companies to seek investments from a smaller group of investors. For investors, it offers opportunities to invest in private companies, often with fewer restrictions, but also with different levels of risk and disclosure.
FAQ
What financing did La Rosa Holdings Corp. (LRHC) announce in this 8-K?
La Rosa entered a Securities Purchase Agreement to issue up to 500 shares of Series D Convertible Preferred Stock at $1,000 per share. An initial 250 shares close for $250,000, with another 250 shares potentially issued after filing its Form 10-K for 2025.
What are the key terms of La Rosa (LRHC) Series D Convertible Preferred Stock?
The Series D Preferred pays no dividends and has limited voting rights, mainly on actions affecting its preferences. It is convertible into common stock at a $1.58 Conversion Price or an Alternate Conversion Price formula tied to VWAP, subject to a 9.99% beneficial ownership cap.
How is the Alternate Conversion Price for La Rosa (LRHC) Series D calculated?
The Alternate Conversion Price is the lower of the current Conversion Price and the greater of the Floor Price or 90% of the lowest VWAP over ten consecutive trading days. If used, the Conversion Amount is multiplied by 105% in a Change of Control or 125% otherwise.
Does La Rosa (LRHC) have redemption rights on the Series D Preferred Stock?
La Rosa can redeem all, but not less than all, outstanding Series D shares. The redemption price equals the greater of the Conversion Amount or the product of the applicable Conversion Rate and the greatest closing sale price of the common stock during a specified recent trading period.
What anti-dilution protection applies to La Rosa (LRHC) Series D Preferred?
If La Rosa issues common stock or related securities at an effective price below the then-current Conversion Price, the Series D Conversion Price adjusts to that lower effective price. Certain issuances, such as equity incentive plans and some strategic acquisitions, are excluded under the Certificate of Designation.
Under what exemption was La Rosa (LRHC) Series D Preferred issued?
The Series D Preferred Stock was issued to the institutional investor under an exemption from Securities Act registration provided by Rule 506(b) of Regulation D. This exemption allows private placements to accredited investors without a public offering registration requirement.