Company: LRHC
Filing Date: 2025-11-19
Form Type: 10-Q
Source: 0001213900-25-112656
Chunk: 180

Company: La Rosa Holdings Corp.
Filing Date: 2025-11-19
Form: 10-Q
Item: Item 8
Chunk 180
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the relevant pricing period and (ii) the lowest daily (or hourly) VWAP during the relevant pricing period. In the event the bid price
of the common stock is at or below $0.10 per share, the Investor will have the right to consent to any Advance. Any purchase under an
Advance would be subject to certain limitations, including that the Investor shall not purchase any shares of Common Stock that would
result in the Investor beneficially owning more than 4.99% of the outstanding common shares or voting power of the Company (the Investor
can request to increase this limit to 9.99%). Additionally, any purchase under an Advance would also be subject to a 19.99% limit based
on the outstanding shares of common stock at the issuance date, prior to the receipt of shareholder approval.

The EPFA was determined to represent a combination
of a purchased put option on the Company’s common stock (prior to an Advance, the “EPFA Option”) as well a forward
contract to deliver the Company’s common stock (after an Advance, but prior to delivery of the shares). The EPFA Option was determined
to be a freestanding financial instrument which did not meet the criteria to be accounted for as a derivative instrument or to be recognized
within equity. Pursuant to ASC 815 Derivatives and Hedging (“ASC 815”), the Company will therefore recognize the EPFA
Option as an asset or liability, measured at fair value at the date of issuance and at each reporting period, with changes in fair value
recognized in earnings. The EPFA Option was determined to have a fair value of $0 on the date of issuance as well as September 30, 2025.
In addition, as the EPFA Option did not meet the requirements for equity classification, the Company expensed the issuance costs incurred
in association with the EPFA in the periods in which they were incurred.

Second
Amended 2022 Plan

On
July 9, 2025, our Compensation Committee, our Board of Directors, and the stockholders approved the Second Amended 2022 Plan. Pursuant
to the Second Amended 2022 Plan (i) the total number of shares of common stock subject to the plan was revised from 156,250 shares (as
adjusted for the 80-for-1 reverse stock split effected by the Company on July 7, 2025) to 374,961 shares to ensure sufficient shares
are available for future grants