Company: LRHC
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032211
Chunk: 596

Company: La Rosa Holdings Corp.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1B
Chunk 596
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ization is calculated on a straight-line basis over the estimated useful lives of
the definite-lived intangible assets, as follows:

    Useful Life 
  
    Franchise agreement 
    10 to 11 years 
  
    Agent relationships 
    8 to 11 years 
  
    Real estate listings 
    1 year 
  
    Non-compete agreements 
    4 years 

Business Combinations

The Company completed a number of acquisitions
during 2024 and 2023 and will acquire additional businesses in the future. The results of businesses acquired in a business combination
are included in the Company’s consolidated financial statements from the date of acquisition. The Company allocates the purchase
price, which is the sum of the consideration provided and may consist of cash, equity, or a combination of the two, in a business combination
to the identifiable assets and liabilities of the acquired business at their acquisition date fair values. The excess of the purchase
price over the amount allocated to the identifiable assets and liabilities, if any, is recorded as goodwill. Determining the fair value
of assets acquired and liabilities assumed requires management to use significant judgment and estimates, including the selection of valuation
methodologies, estimates of future revenue and cash flows, discount rates, and selection of comparable companies.

To date, the assets acquired and liabilities assumed
in the Company’s business combinations have primarily consisted of goodwill and finite-lived intangible assets, consisting primarily
of franchise agreements, agent relationships, real estate listings, non-compete agreements, and right-of-use assets. The estimated fair
values and useful lives of identifiable intangible assets are based on many factors, including estimates and assumptions of future operating
performance and cash flows of the acquired business, the nature of the business acquired, and the specific characteristics of the identified
intangible assets. The estimates and assumptions used to determine the fair values and useful lives of identified intangible assets could
change due to numerous factors, including market conditions, technological developments, economic conditions and competition. In connection
with the determination of fair values, the Company engages independent appraisal firms to assist with the valuation of intangible assets
acquired and certain assumed obligations.

Transaction costs associated with business combinations
are expensed as incurred.

Goodwill

Goodwill is the excess of cost over the fair value
of net assets acquired. Goodwill is not amortized but tested for impairment annually or more frequently if certain circumstances indicate
a possible impairment may exist. The Company recognized goodwill for the first time in the fourth quarter of