Company: LRHC
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032211
Chunk: 60

Company: La Rosa Holdings Corp.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1
Chunk 60
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ers
of our Securities must bear the risk that any future offerings we conduct or borrowings we make may adversely affect the level of return,
if any, they may be able to achieve from an investment in our Securities. 

If our securities become
subject to the penny stock rules, it would become more difficult to trade our shares.

The SEC has adopted rules
that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with
a price of less than $5.00 per share, other than securities registered on certain national securities exchanges or authorized for quotation
on certain automated quotation systems, provided that current price and volume information with respect to transactions in such securities
is provided by the exchange or system. If we do not retain a listing on Nasdaq or another national securities exchange and if the price
of our securities is less than $5.00, our securities could be deemed a penny stock. The penny stock rules require a broker-dealer, before
a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document containing specified
information. In addition, the penny stock rules require that before effecting any transaction in a penny stock not otherwise exempt from
those rules, a broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser
and receive (i) the purchaser’s written acknowledgment of the receipt of a risk disclosure statement; (ii) a written agreement to
transactions involving penny stocks; and (iii) a signed and dated copy of a written suitability statement. These disclosure requirements
may have the effect of reducing the trading activity in the secondary market for our Common Stock, and therefore shareholders may have
difficulty selling their Common Stock.

We may have violated
Section 13(k) of the Exchange Act (implementing Section 402 of the Sarbanes-Oxley Act of 2002) and may be subject
to sanctions as a result.

Section 13(k) of the Exchange
Act provides that it is unlawful for a company that has a class of securities registered under Section 12 of the Exchange Act to, directly
or indirectly, including through any subsidiary, extend or maintain credit in the form of a personal loan to or for any of its
directors or executive officers. From February 2017 to July 2023, La Rosa Realty, LLC, a subsidiary of the Company, provided interest
free, due on demand advances to