Company: LRHC
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032211
Chunk: 2318

Company: La Rosa Holdings Corp.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 7A
Chunk 2318
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 transaction. Commissions revenue contains a single performance obligation that
is satisfied upon the closing of a real estate transaction, at which point the entire transaction price is earned. The Company’s
customers remit payment for the Company’s services to the title company or attorney closing the sale of property at the time of
closing. The Company is not entitled to any commission until the performance obligation is satisfied and is not owed any commission for
unsuccessful transactions, even if services have been provided. In addition to commission, revenue from real estate brokerage services
(residential) consists of annual and monthly dues charged to the agents for providing systems, accounting, marketing tools and compliance
services. The annual and monthly dues are recognized each month as services are provided.

Franchising Services

The Company’s franchise agreements
offer the following benefits to the franchisee: common use and promotion of La Rosa Realty trademark; distinctive sales and promotional
materials; access to technology and training; and recommended procedures for operation of La Rosa Realty franchises. The Company concluded
that these benefits are highly related and part of one performance obligation for each franchise agreement, a license of symbolic intellectual
property that is billed through a variety of fees including (i) initial franchise fees, (ii) annual dues and (iii) royalty fees. Initial
franchise fees consist of a fixed fee payable upon signing the franchise agreement. Annual dues are calculated at a fixed fee per agent
(prorated for any partial year) payable annually before the 10th day of January or within 10 days after each agent commences their association
with the franchise. Royalty fees are calculated as the greater of a (a) fixed percentage of gross commission income for the period which
is made up of all commissions, transaction fees, property management fees, and monthly fees earned by the Franchisee and the Franchisee’s
independent sales associates, agents, representatives, contractors, employees, partners, directors, officers, owners, or affiliates, regardless
of whether or not such individuals or affiliates are entitled to retain all or part of such gross commission income, or (b) a fixed monthly
fee.

F-12

Coaching Services

The Company provides mandatory training
and guidance to newly licensed agents for their first four sales transactions. For each of the four transactions the newly licensed agents
completes, La Rosa Coaching earns 7% for the brokerage who sponsors the agent, which may be La Rosa Realty, earns 10% of the commission.
Coaches also provide optional special education