Company: LRHC
Filing Date: 2025-05-29
Form Type: 10-Q
Source: 0001213900-25-048370
Chunk: 188

Company: La Rosa Holdings Corp.
Filing Date: 2025-05-29
Form: 10-Q
Item: Item 2
Chunk 188
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2025 as compared to the three months ended March 31, 2024.
Of this $695 thousand is related to professional service, $594 thousand is related to payroll and related cost $330 for sales and marketing.

Stock-based compensation

We incurred stock-based compensation of approximately
$1.9 million in the three months ended March 31, 2025, primarily due to option grants to our CEO pursuant to the terms of his employment
agreement ($1.3 million), and consultants who provided various services to the Company ($0.6 million).

Other Income (Expense), Net

Other expense, net for the three months ended
March 31, 2025, increased approximately $91.0 million compared to other expense, net, for the three months ended March 31, 2024. The increase
in expense in 2025 was primarily due to the loss on issuance of senior secured convertible note for $128.8 million and loss on extinguishment
of debt for $152 thousand, offset by a gain of $37.1 million on the change in fair value of convertible note and warrants and a $0.9 million
gain on the change in fair value of a derivative liability.

Liquidity and Capital Resources

On March 31, 2025, the Company had a cash balance of $4.9 million and
negative working capital of $94.0 million.

On February 4, 2025, the Company and an institutional
investor entered into the SPA, pursuant to which the Company issued to the Investor: (i) a Senior Secured Convertible Note in the original
principal amount of $5,500,000 which matures on February 4, 2027 (the “Initial Note”); and (ii) sixteen (16) warrants (the
“Incremental Warrants”), each to purchase additional Notes in an original principal amount up to $2,500,000 at an exercise
price of $2,256,250, in substantially the same form as the Initial Note (“Incremental Notes” and together with the Initial
Note, the “Notes”). The purchase price paid by the Investor under the SPA for the Initial Note and Incremental Warrants was
$4,963,750.

The $4,963,750 in gross proceeds from the offering was used by the
Company to pay-off certain indebtedness of the Company, pay certain outstanding fees and expenses (including expenses of the offering,
and fees payable to the placement agent