La Rosa Holdings Corp. 8-K

What Happened

• La Rosa Holdings (LRHC) announced an initial closing under a Securities Purchase Agreement for a financing of up to $250 million. On January 8, 2026 the company issued an $11,000,000 senior secured convertible note (the "Initial Note") to investors for $9,900,000, and received $9,635,000 in net proceeds.
• The Initial Note converts into common stock at an initial conversion price of $0.8347 (adjustable), with a minimum floor price of $0.778. It bears interest at 10% per year (payable monthly), matures in 24 months, and has default provisions that raise interest to 19% if triggered.

Key Details

• Amounts & uses: Net proceeds $9,635,000 — $7,000,000 to buy crypto assets for the company treasury, $2,000,000 to redeem Series X Super Voting Preferred Stock, $500,000 held in a controlled account to fund remaining redemptions; remaining proceeds for general corporate purposes and strategic transactions.
• Security & guarantees: Notes rank pari passu with other notes in the financing, senior to other debt (except permitted liens). The company and subsidiaries granted (i) a first‑priority lien on assets acquired with the closing proceeds and (ii) a second‑priority lien on remaining assets; subsidiaries provided guaranties and an IP security agreement was filed.
• Conversion and ownership limits: A holder cannot convert to own more than 4.99% of outstanding common stock post‑conversion (beneficial ownership cap). Holders may raise that cap up to 9.99% with notice; any increase becomes effective on the 61st day after notice.
• Governance/fees/redemptions: The company must seek shareholder approval within 30 days to adjust the Floor Price. Placement agent Curvature Securities LLC will receive up to 7% cash of gross proceeds. The company redeemed 200 shares of Series X held by CEO Joseph La Rosa and will pay him $1.7M immediately and $300K later.

Why It Matters

• This transaction adds a substantial new secured debt layer that can convert into equity, creating potential future dilution for common shareholders if notes are converted. The conversion price, floor, and beneficial ownership cap determine how much dilution could occur.
• The notes are secured and rank senior to most existing and future company debt, which affects creditor priority and the company’s capital structure. Use of proceeds shows a mix of strategic treasury investment (crypto), preferred‑share redemptions and working capital — details investors should watch for how these uses affect liquidity and business strategy.
• Shareholder approval to adjust the Floor Price and the conversion mechanics (including ownership caps) are near‑term gating items that could change dilution dynamics; investors should monitor any subsequent disclosures or shareholder actions.