LRHC La Rosa Holdings Corporation

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

 

Date of Report (Date of earliest event reported): May 20, 2024

 

La Rosa Holdings Corp.

(Exact name of registrant as specified in its charter)

 

Nevada		001-41588		87-1641189
(State or other jurisdiction of incorporation)		(Commission File Number)		(I.R.S. Employer Identification No.)

 

1420 Celebration Blvd., 2nd Floor Celebration, Florida		34747
(Address of principal executive offices)		(Zip Code)

 

Registrant’s telephone number, including area code: (321) 250-1799

 

N/A

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.0001 par value		LRHC		The Nasdaq Stock Market LLC

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company ☒

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

Item 1.01 Entry into a Material Definitive Agreement.

 

Cash Advance Agreement:

 

On May 20, 2024, La Rosa Holdings Corp., a Nevada corporation (the “Company”), entered into a Cash Advance Agreement (the “Cash Advance Agreement”) with Cedar Advance LLC (“Cedar”) pursuant to which the Company sold to Cedar $761,250 of its future receivables, including cash, check, credit or debit card, electronic transfer, or other form of monetary payments from third parties (the “Receivables Purchased Amount”), for a purchase price of $525,000 less underwriting fees and expenses paid, for net funds of $500,000 to the Company.

 

Under the Cash Advance Agreement, the Receivables Purchased Amount will be decreased to $630,000 if the Company delivers such amount of future receivables to Cedar within 30 calendar days of the date of the Cash Advance Agreement, or $661,500 if the Company delivers such amount of future receivables to Cedar within 60 calendar days of the date of the Cash Advance Agreement.

 

Pursuant to the Cash Advance Agreement, Cedar is expected to withdraw $23,000 a week directly from the Company’s bank account until the Receivables Purchased Amount due to Cedar under the Cash Advance Agreement is paid in full.

 

In the event of a default (as defined in the Cash Advance Agreement), Cedar, among other remedies, can demand payment in full of all amounts remaining due under the Cash Advance Agreement. To guarantee the Company’s satisfaction of its obligations under the Cash Advance Agreement, the Company granted Cedar a security interest in all its accounts, including deposit accounts and accounts receivable and proceeds.

 

The foregoing description of the Cash Advance Agreement is qualified in its entirety by reference to the full text of the Cash Advance Agreement, a copy of which is attached hereto as Exhibit 10.1 and incorporated herein in its entirety by reference.

 

La Rosa Realty Success LLC:

 

On May 24, 2024, the Company consummated its acquisition of 51% of the membership interests (the “Membership Interests”) of La Rosa Realty Success LLC, a Florida limited liability company and a franchisee of the Company (“Realty Success”), pursuant to that certain membership interest purchase agreement, dated May 24, 2024 (the “Purchase Agreement”), by and among the Company, Realty Success, and the sole member (the “Selling Member”) of Realty Success (the “Transaction”).

 

The purchase price for the Membership Interests was $78,777.85, consisting of 56,375 unregistered shares of the Company’s common stock (the “Purchase Shares”) and $10,000 in cash (the “Cash Payment”), of which $5,000 was paid at closing and the remaining $5,000 is payable 30 days after closing. The number of Purchased Shares was based on the $1.22 closing price of the Company’s common stock for the prior closing date as reported by The Nasdaq Stock Market, LLC. The Cash Payment is payable in two equal installments on the closing date and 30 days after.

 

Concurrently with the Transaction, on May 24, 2024, the Selling Member entered into a lock-up/leak-out agreement (the “Lock-up Agreement”) with the Company pursuant to which the Selling Member may not sell more than one-twelfth of their Purchase Shares per calendar month during the one year commencing after the six-month holding period under Rule 144 promulgated under the Securities Act of 1933, as amended (the “Securities Act”), subject to applicable securities laws.

 

The preceding summaries of the Purchase Agreement and the Lock-up Agreements purport to be summaries only and are qualified in their entireties by reference to such agreements, copies of which are filed as Exhibit 10.2 and Exhibit 10.3, respectively, to this Current Report on Form 8-K and are incorporated herein by reference.

 

 

Item 2.01 Completion of Acquisition or Disposition of Assets.

 

Cash Advance Agreement:

 

The information contained in Item 1.01 of this Current Report about the Company’s sale of its future receivables to Cedar under the Cash Advance Agreement is incorporated by reference herein.

 

La Rosa Realty Success LLC:

 

The information contained in Item 1.01 of this Current Report about the Company’s acquisition of 51% of the membership interests of Realty Success is incorporated by reference herein.

 

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

 

Cash Advance Agreement:

 

To the extent required by Item 2.03 of Form 8-K, the information contained in Item 1.01 of this Current Report is incorporated herein by reference.

 

Item 9.01. Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit No.		Description
10.1		Standard Merchant Cash Advance Agreement, dated May 20, 2024, between La Rosa Holdings Corp. and Cedar Advance LLC
10.2		Membership Purchase Agreement, dated May 24, 2024, by and among La Rosa Holdings, Corp., La Rosa Realty Success, LLC, and the Selling Member
10.3		Leak-Out Agreement, dated May 24, 2024, between La Rosa Holdings Corp. and the Selling Member
104		Cover Page Interactive Data File (embedded with the Inline XBRL document).

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: May 24, 2024	LA ROSA HOLDINGS CORP.
	By:	/s/ Joseph La Rosa
	Name:	Joseph La Rosa
	Title:	Chief Executive Officer

 

 

3

 

Exhibit 10.1

 

Page 1 of 12

 

 

CEDAR ADVANCE LLC

5401 Collins Avenue CU-9A
Miami Beach, FL 33140 (786) 605-8900

reconciliations@cedaradvance.com

 

STANDARD MERCHANT CASH ADVANCE AGREEMENT

 

This is an Agreement dated 05/20/2024 by and between CEDAR ADVANCE LLC (“CEDAR”), inclusive of its successors and assigns, and each merchant listed below (“Merchant”).

Merchant’s Legal Name: LA ROSA HOLDINGS CORP. / La Rosa Coaching, LLC / La Rosa CRE LLC / La Rosa Realty, LLC / La Rosa Property Management, LLC D/B/A/: LA ROSA Fed ID #: 87-1641189 Type of Entity: ☒ Corporation ☐ Limited Liability Company ☐ Partnership ☐ Sole Proprietorship Business Address: 1420 Celebration Blvd., 2nd Floor City: Celebration State: FL Zip: 34747 Contact Address: 420 Celebration Blvd., 2nd Floor City: Celebration State: FL Zip: 34747 E-mail Address: ___________ Phone Number: ________________

 

Purchase Price This is the amount being paid to Merchant(s) for the Receivables Purchased Amount (defined below). This amount may be paid in installments if there is an Addendum stating that it will be paid in installments.		$	525,000.00
Receivables Purchased Amount This is the amount of Receivables (defined in Section 1 below) being sold. This amount may be sold in installments if there is an Addendum stating that it will be sold in installments.		$	761,250.00
Specified Percentage This is the percentage of Receivables (defined below) to be delivered until the Receivables Purchased Amount is paid in full.			10	%
Net Funds Provided This is the net amount being paid to or on behalf of Merchant(s) after deduction of applicable fees listed in Section 2 below. This amount may be paid in installments if there is an Addendum stating that it will be paid in installments.		$	500,000.00
Net Amount to Be Received Directly by Merchant(s) This is the net amount being received directly by Merchant(s) after deduction of applicable fees listed in Section 2 below and the payment of any part of the Purchase Price elsewhere pursuant to any Addendum to this Agreement. This amount may be paid in installments if there is an Addendum stating that it will be paid in installments. If any deduction is being made from the Purchase Price to pay off another obligation by Merchant(s), then the Net Amount to be Received Directly by Merchant(s) is subject to change based on any change in the amount of the other obligation(s) to be paid off.		$	500,000.00
Initial Estimated Payment This is the initial amount of periodic payments collected from Merchant(s) as an approximation of no more than the Specified Percentage of the Receivables and is subject to reconciliation as set forth in Section 4 below.		$	23,000.00
			per WEEK

 

	I have read and agree to the terms and conditions set forth above:
		/s/ Joseph La Rosa
	Name:	Joseph La Rosa		Title: __________		Date: 05/20/2024

 

 

Page 2 of 12

 

STANDARD MERCHANT CASH ADVANCE AGREEMENT

 

TERMS AND CONDITIONS

 

1. Sale of Future Receipts. Merchant(s) hereby sell, assign, and transfer to CEDAR (making CEDAR the absolute owner) in consideration of the funds provided (“Purchase Price”) specified above, all of each Merchant’s future accounts, contract rights, and other obligations arising from or relating to the payment of monies from each Merchant’s customers and/or other third party payors (the “Receivables”, defined as all payments made by cash, check, credit or debit card, electronic transfer, or other form of monetary payment in the ordinary course of each merchant’s business), for the payment of each Merchant’s sale of goods or services until the amount specified above (the “Receivables Purchased Amount”) has been delivered by Merchant(s) to CEDAR. Each Merchant hereby acknowledges that until the Receivables Purchased Amount has been received in full by CEDAR, each Merchant’s Receivables, up to the balance of the Receivables Purchased Amount, are the property of CEDAR and not the property of any Merchant. Each Merchant agrees that it is a fiduciary for CEDAR and that each Merchant will hold Receivables in trust for CEDAR in its capacity as a fiduciary for CEDAR.

 

The Receivables Purchased Amount shall be paid to CEDAR by each Merchant irrevocably authorizing only one depositing account acceptable to CEDAR (the “Account”) to remit the percentage specified above (the “Specified Percentage”) of each Merchant’s settlement amounts due from each transaction, until such time as CEDAR receives payment in full of the Receivables Purchased Amount. Each Merchant hereby authorizes CEDAR to ACH debit the specified remittances and any applicable fees listed in Section 2 from the Account on a daily basis as of the next business day after the date of this Agreement and will provide CEDAR with all required access codes and monthly bank statements. Each Merchant understands that it will be held responsible for any fees resulting from a rejected ACH attempt or an Event of Default (see Section 2). CEDAR is not responsible for any overdrafts or rejected transactions that may result from CEDAR’s ACH debiting the Specified Percentage amounts under the terms of this Agreement. Each Merchant acknowledges and agrees that until the amount of the Receivables collected by CEDAR exceeds the amount of the Purchase Price, CEDAR will be permitted not treat any amount collected under this Agreement as profit for taxation and accounting purposes.

 

2. Additional Fees. In addition to the Receivables Purchased Amount, each Merchant will be held responsible to CEDAR for the following fees, where applicable:

 

A. $25,000.00 - to cover underwriting, the ACH debit program, and expenses related to the procurement and initiation of the transactions encompassed by this Agreement. This will be deducted from payment of the Purchase Price.

 

B. Wire Fee - Merchant(s) shall receive funding electronically to the Account and will be charged $50.00 for a Fed Wire or $0.00 for a bank ACH. This will be deducted from payment of the Purchase Price.

 

C. NSF/Rejected ACH Fee - $50.00 for each time an ACH debit to the Account by CEDAR is returned or otherwise rejected. No Merchant will be held responsible for such a fee if any Merchant gives CEDAR notice no more than one business day in advance that the Account will have insufficient funds to be debited by CEDAR and no Merchant is otherwise in default of the terms of the Agreement. Each such fee may be deducted from any payment collected by CEDAR or may be collected in addition to any other payment collected by CEDAR under this Agreement.

 

D. Blocked Account/Default - $2,500.00 - If an Event of Default has taken place under Section 30.

 

E. UCC Fee - $195.00 – to cover CEDAR filing a UCC-1 financing statement to secure its interest in the Receivables Purchased Amount. A $195.00 UCC termination fee will be charged if a UCC filing is terminated.

 

F. $_________ - legal compliance with applicable disclosure laws and regulations. This will be deducted from payment of the Purchase Price.

 

G. Court costs, arbitration fees, collection agency fees, attorney fees, expert fees, and any other expenses incurred in litigation, arbitration, or the enforcement of any of CEDAR’s legal or contractual rights against each Merchant and/or each Guarantor, if required, as explained in other Sections of this Agreement.

 

3. Estimated Payments. Instead of debiting the Specified Percentage of Merchant’s Receivables, CEDAR may instead debit $23,000.00 (“Estimated Payment”) from the Account every WEEK. The Estimated Payment is intended to be an approximation of no more than the Specified Percentage, subject to reconciliation.

 

	I have read and agree to the terms and conditions set forth above:
		/s/ Joseph La Rosa
	Name:	Joseph La Rosa		Title: __________		Date: 05/20/2024

 

 

Page 3 of 12

 

STANDARD MERCHANT CASH ADVANCE AGREEMENT

 

4. Reconciliations. Any Merchant may contact CEDAR’s Reconciliation Department to request that CEDAR conduct a reconciliation in order to ensure that the amount that CEDAR has collected equals the Specified Percentage of Merchant(s)’s Receivables under this Agreement. A request for a reconciliation by any Merchant must be made by giving written notice of the request to CEDAR or by sending an e-mail to reconciliations@cedaradvance.com stating that a reconciliation is being requested. In order to effectuate the reconciliation, any Merchant must produce with its request any and all bank statements covering the period from the date of this Agreement through the date of the request for a reconciliation as well as Merchant’s account reports showing transactions in the month to date, or other documents or reports available to Merchant for verification of its revenues, or , if available, the login and password for the Account. Once, notified of a request for reconciliation, CEDAR will instruct it’s ACH processor to pause ACH debits from Merchant’s account until the reconciliation process is complete. CEDAR will complete each reconciliation requested by any Merchant within two business days after receipt of proper notice of a request for one accompanied by the information and documents required for it. CEDAR may also conduct a reconciliation on its own at any time by reviewing Merchant(s)’s Receivables covering the period from the date of this Agreement until the date of initiation of the reconciliation, each such reconciliation will be completed within two business days after its initiation, and CEDAR will give each Merchant written notice of the determination made based on the reconciliation within one business day after its completion. If a reconciliation determines that CEDAR collected more than it was entitled to, then CEDAR will credit to the Account all amounts to which CEDAR was not entitled and, if there is an Estimated Payment, decrease the amount of the Estimated Payment so that it is consistent with the Specified Percentage of Merchant(s)’s Receivables from the date of the Agreement through the date of the reconciliation. If a reconciliation determines that CEDAR collected less than it was entitled to, then CEDAR will debit from the Account all additional amounts to which CEDAR was entitled and, if there is an Estimated Payment, increase the amount of the Estimated Payment so that it is consistent with the Specified Percentage of Merchant(s)’s Receivables from the date of the Agreement through the date of the reconciliation. For the avoidance of doubt, in the event Merchant desires reconciliation it shall be Merchant’s sole responsibility to initiate the reconciliation process in this Section 4. Nothing herein limits the amount of times that a reconciliation may be requested or conducted.

 

5. Merchant Deposit Agreement. Merchant(s) shall appoint a bank acceptable to CEDAR, to obtain electronic fund transfer services and/or “ACH” payments. Merchant(s) shall provide CEDAR and/or its authorized agent with all of the information, authorizations, and passwords necessary to verify each Merchant’s Receivables. Merchant(s) shall authorize CEDAR and/or its agent(s) to deduct the amounts owed to CEDAR for the Receivables as specified herein from settlement amounts which would otherwise be due to each Merchant and to pay such amounts to CEDAR by permitting CEDAR to withdraw the Specified Percentage by ACH debiting of the account. The authorization shall be irrevocable as to each Merchant absent CEDAR’s written consent until the Receivables Purchased Amount has been paid in full or the Merchant becomes bankrupt or goes out of business without any prior default under this Agreement.

 

6. Term of Agreement. The term of this Agreement is indefinite and shall continue until CEDAR receives the full Receivables Purchased Amount, or earlier if terminated pursuant to any provision of this Agreement. The provisions of Sections 1, 2, 3, 4, 5, 6, 7, 9, 10, 12, 13, 14, 15, 16, 17, 18, 22, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 41, 42, 43, 44, 45, 46, 47, 48, 49, 50, 51, and 52 shall survive any termination of this Agreement.

 

7. Ordinary Course of Business. Each Merchant acknowledges that it is entering into this Agreement in the ordinary course of its business and that the payments to be made from each Merchant to CEDAR under this Agreement are being made in the ordinary course of each Merchant’s business.

 

8. Financial Condition. Each Merchant and each Guarantor (Guarantor being defined as each signatory to the Guarantee of this Agreement) authorizes CEDAR and its agent(s) to investigate each Merchant’s financial responsibility and history, and will provide to CEDAR any bank or financial statements, tax returns, and other documents and records, as CEDAR deems necessary prior to or at any time after execution of this Agreement. A photocopy of this authorization will be deemed as acceptable for release of financial information. CEDAR is authorized to update such information and financial profiles from time to time as it deems appropriate.

 

9. Monitoring, Recording, and Electronic Communications. CEDAR may choose to monitor and/or record telephone calls with any Merchant and its owners, employees, and agents. By signing this Agreement, each Merchant agrees that any call between CEDAR and any Merchant or its representatives may be monitored and/or recorded. Each Merchant and each Guarantor grants access for CEDAR to enter any Merchant’s premises and to observe any Merchant’s premises without any prior notice to any Merchant at any time after execution of this Agreement.

 

CEDAR may use automated telephone dialing, text messaging systems, and e-mail to provide messages to Merchant(s), Owner(s) (Owner being defined as each person who signs this Agreement on behalf of a Merchant), and Guarantor(s) about Merchant(s)’s account. Telephone messages may be played by a machine automatically when the telephone is answered, whether answered by an Owner, a Guarantor, or someone else. These messages may also be recorded by the recipient’s answering machine or voice mail. Each Merchant, each Owner, and each Guarantor gives CEDAR permission to call or send a text message to any telephone number given to CEDAR in connection with this Agreement and to play pre-recorded messages and/or send text messages with information about this Agreement and/or any Merchant’s account over the phone. Each Merchant, each Owner, and each Guarantor also gives CEDAR permission to communicate such information to them by e-mail. Each Merchant, each Owner, and each Guarantor agree that CEDAR will not be liable to any of them for any such calls or electronic communications, even if information is communicated to an unintended recipient. Each Merchant, each Owner, and each Guarantor acknowledge that when they receive such calls or electronic communications, they may incur a charge from the company that provides them with telecommunications, wireless, and/or Internet services, and that CEDAR has no liability for any such charges.

 

	I have read and agree to the terms and conditions set forth above:
		/s/ Joseph La Rosa
	Name:	Joseph La Rosa		Title: __________		Date: 05/20/2024

 

 

Page 4 of 12

 

STANDARD MERCHANT CASH ADVANCE AGREEMENT

 

10. Accuracy of Information Furnished by Merchant and Investigation Thereof. To the extent set forth herein, each of the parties is obligated upon his, her, or its execution of the Agreement to all terms of the Agreement. Each Merchant and each Owner signing this Agreement represent that he or she is authorized to sign this Agreement for each Merchant, legally binding said Merchant to its obligations under this Agreement and that the information provided herein and in all of CEDAR’s documents, forms, and recorded interview(s) is true, accurate, and complete in all respects. CEDAR may produce a monthly statement reflecting the delivery of the Specified Percentage of Receivables from Merchant(s) to CEDAR. An investigative report may be made in connection with the Agreement. Each Merchant and each Owner signing this Agreement authorize CEDAR, its agents and representatives, and any credit-reporting agency engaged by CEDAR, to (i) investigate any references given or any other statements obtained from or about each Merchant or any of its Owners for the purpose of this Agreement, and (ii) pull credit report at any time now or for so long as any Merchant and/or Owners(s) continue to have any obligation to CEDAR under this Agreement or for CEDAR’s ability to determine any Merchant’s eligibility to enter into any future agreement with CEDAR. Any misrepresentation made by any Merchant or Owner in connection with this Agreement may constitute a separate claim for fraud or intentional misrepresentation.

 

Authorization for soft pulls: Each Merchant and each Owner understands that by signing this Agreement, they are providing ‘written instructions’ to CEDAR under the Fair Credit Reporting Act, authorizing CEDAR to obtain information from their personal credit profile or other information from Experian, TransUnion, and Equifax. Each Merchant and each Guarantor authorizes CEDAR to obtain such information solely to conduct a pre-qualification for credit.

 

Authorization for hard pulls: Each Merchant and each Owner understands that by signing this Agreement, they are providing ‘written instructions’ to CEDAR under the Fair Credit Reporting Act, authorizing CEDAR to obtain information from their personal credit profile or other information from Experian, TransUnion, and Equifax. Each Merchant and each Guarantor authorizes CEDAR to obtain such information in accordance with a merchant cash advance application.

 

11. Transactional History. Each Merchant authorizes its bank to provide CEDAR with its banking and/or credit card processing history.

 

12. Indemnification. Each Merchant and each Guarantor jointly and severally indemnify and hold harmless each Merchant’s credit card and check processors (collectively, “Processor”) and Processor’s officers, directors, and shareholders against all losses, damages, claims, liabilities, and expenses (including reasonable attorney and expert fees) incurred by Processor resulting from (a) claims asserted by CEDAR for monies owed to CEDAR from any Merchant and (b) actions taken by any Processor in reliance upon information or instructions provided by CEDAR.

 

13. No Liability. In no event will CEDAR be liable for any claims asserted by any Merchant under any legal theory for lost profits, lost revenues, lost business opportunities, exemplary, punitive, special, incidental, indirect, or consequential damages, each of which is waived by each Merchant and each Guarantor.

 

14. Sale of Receivables. Each Merchant and CEDAR agree that the Purchase Price under this Agreement is in exchange for the Receivables Purchased Amount and that such Purchase Price is not intended to be, nor shall it be construed as a loan from CEDAR to any Merchant. CEDAR is entering into this Agreement knowing the risks that each Merchant’s business may decline or fail, resulting in CEDAR not receiving the Receivables Purchased Amount. Any Merchant going bankrupt, going out of business, or experiencing a slowdown in business or a delay in collecting Receivables will not on its own without anything more be considered a breach of this Agreement. Each Merchant agrees that the Purchase Price in exchange for the Receivables pursuant to this Agreement equals the fair market value of such Receivables. CEDAR has purchased and shall own all the Receivables described in this Agreement up to the full Receivables Purchased Amount as the Receivables are created. Payments made to CEDAR in respect to the full amount of the Receivables shall be conditioned upon each Merchant’s sale of products and services and the payment therefor by each Merchant’s customers in the manner provided in this Agreement. Each Merchant and each Guarantor acknowledges that CEDAR does not purchase, sell, or offer to purchase or sell securities and that this Agreement is not a security, an offer to sell any security, or a solicitation of an offer to buy any security. Although certain jurisdictions require the disclosure of an Annual Percentage Rate or APR in connection with this Agreement, those disclosures do not change the fact that the transaction encompassed by this Agreement is not a loan and does not have an interest rate.

 

	I have read and agree to the terms and conditions set forth above:
		/s/ Joseph La Rosa
	Name:	Joseph La Rosa		Title: __________		Date: 05/20/2024

 

 

Page 5 of 12

 

STANDARD MERCHANT CASH ADVANCE AGREEMENT

 

15. Power of Attorney. Each Merchant irrevocably appoints CEDAR as its agent and attorney-in-fact with full authority to take any action or execute any instrument or document to settle all obligations due to CEDAR for the benefit of each Merchant and only in order to prevent the occurrence of an Event of Default (as described in Section 30). If an Event of Default takes place under Section 30, then each Merchant irrevocably appoints CEDAR as its agent and attorney-in-fact with full authority to take any action or execute any instrument or document to settle all obligations due to CEDAR from each Merchant, including without limitation (i) to collect monies due or to become due under or in respect of any of the Collateral (which is defined in Section 29); (ii) to receive, endorse and collect any checks, notes, drafts, instruments, documents, or chattel paper in connection with clause (i) above; (iii) to sign each Merchant’s name on any invoice, bill of lading, or assignment directing customers or account debtors to make payment directly to CEDAR; and (iv) to file any claims or take any action or institute any proceeding which CEDAR may deem necessary for the collection of any of the unpaid Receivables Purchased Amount from the Collateral, or otherwise to enforce its rights with respect to payment of the Receivables Purchased Amount.

 

16. Protections Against Default. The following Protections 1 through 6 may be invoked by CEDAR, immediately and without notice to any Merchant if any Event of Default listed in Section 30 has occurred.

 

Protection 1: The full uncollected Receivables Purchased Amount plus all fees due under this Agreement may become due and payable in full immediately.

 

Protection 2. CEDAR may enforce the provisions of the Guarantee against Guarantor. Protection 3. CEDAR may enforce its security interest in the Collateral identified in Section 29.

 

Protection 4. CEDAR may proceed to protect and enforce its rights and remedies by litigation or arbitration.

 

Protection 5. CEDAR may debit any Merchant’s depository accounts wherever situated by means of ACH debit or electronic or facsimile signature on a computer-generated check drawn on any Merchant’s bank account or otherwise, in an amount consistent with the terms of this Agreement.

 

Protection 6. CEDAR will have the right, without waiving any of its rights and remedies and without notice to any Merchant and/or Guarantor, to notify each Merchant’s credit card and/or check processor and account debtor(s) of the sale of Receivables hereunder and to direct such credit card processor and account debtor(s) to make payment to CEDAR of all or any portion of the amounts received by such credit card processor and account debtor(s) on behalf of each Merchant. Each Merchant hereby grants to CEDAR an irrevocable power-of-attorney, which power-of-attorney will be coupled with an interest, and hereby appoints CEDAR and its representatives as each Merchant’s attorney-in-fact to take any and all action necessary to direct such new or additional credit card and/or check processor and account debtor(s) to make payment to CEDAR as contemplated by this Section.

 

17. Protection of Information. Each Merchant and each person signing this Agreement on behalf of each Merchant and/or as Owner, in respect of himself or herself personally, authorizes CEDAR to disclose information concerning each Merchant, Owner and/or Guarantor’s credit standing and business conduct to agents, affiliates, subsidiaries, and credit reporting bureaus. Each Merchant, Guarantor, and Owner hereby waives to the maximum extent permitted by law any claim for damages against CEDAR or any of its affiliates relating to any (i) investigation undertaken by or on behalf of CEDAR as permitted by this Agreement or (ii) disclosure of information as permitted by this Agreement.

 

18. Confidentiality. Each Merchant understands and agrees that the terms and conditions of the products and services offered by CEDAR, including this Agreement and any other CEDAR documents (collectively, “Confidential Information”) are proprietary and confidential information of CEDAR. Accordingly, unless disclosure is required by law or court order, Merchant(s) shall not disclose Confidential Information of CEDAR to any person other than an attorney, accountant, financial advisor, or employee of any Merchant who needs to know such information for the purpose of advising any Merchant (“Advisor”), provided such Advisor uses such information solely for the purpose of advising any Merchant and first agrees in writing to be bound by the terms of this Section 18.

 

	I have read and agree to the terms and conditions set forth above:
		/s/ Joseph La Rosa
	Name:	Joseph La Rosa		Title: __________		Date: 05/20/2024

 

 

Page 6 of 12

 

STANDARD MERCHANT CASH ADVANCE AGREEMENT

 

19. D/B/As. Each Merchant hereby acknowledges and agrees that CEDAR may be using “doing business as” or “d/b/a” names in connection with various matters relating to the transaction between CEDAR and each Merchant, including the filing of UCC-1 financing statements and other notices or filings.

 

20. Financial Condition and Financial Information. Each Merchant represents, warrants, and covenants that its bank and financial statements, copies of which have been furnished to CEDAR, and future statements which will be furnished hereafter at the request of CEDAR, fairly represent the financial condition of each Merchant at such dates, and that since those dates there have been no material adverse changes, financial or otherwise, in such condition, operation, or ownership of any Merchant. Each Merchant has a continuing affirmative obligation to advise CEDAR of any material adverse change in its financial condition, operation, or ownership that may have an effect on any Merchant’s ability to generate Receivables or perform its obligations under this Agreement.

 

21. Governmental Approvals. Each Merchant represents, warrants, and covenants that it is in compliance and shall comply with all laws and has valid permits, authorizations, and licenses to own, operate, and lease its properties and to conduct the business in which it is presently engaged.

 

22. Authorization. Each Merchant represents, warrants, and covenants that it and each person signing this Agreement on behalf of each Merchant has full power and authority to incur and perform the obligations under this Agreement, all of which have been duly authorized.

 

23. Electronic Check Processing Agreement. Each Merchant represents, warrants, and covenants that it will not, without CEDAR’s prior written consent, change its Processor, add terminals, change its financial institution or bank account, or take any other action that could have any adverse effect upon any Merchant’s obligations under this Agreement.

 

24. Change of Name or Location. Each Merchant represents, warrants, and covenants that it will not conduct its business under any name other than as disclosed to CEDAR or change any place(s) of its business without giving prior written notice to CEDAR.

 

25. No Bankruptcy. Each Merchant represents, warrants, and covenants that as of the date of this Agreement, it does not contemplate and has not filed any petition for bankruptcy protection under Title 11 of the United States Code and there has been no involuntary petition brought or pending against any Merchant. Each Merchant further warrants that it does not anticipate filing any such bankruptcy petition and it does not anticipate that an involuntary petition will be filed against it.

 

26. Unencumbered Receivables. Each Merchant represents, warrants, and covenants that it has good, complete, and marketable title to all Receivables, free and clear of any and all liabilities, liens, claims, changes, restrictions, conditions, options, rights, mortgages, security interests, equities, pledges, and encumbrances of any kind or nature whatsoever or any other rights or interests that may be inconsistent with this Agreement or adverse to the interests of CEDAR, other than any for which CEDAR has actual or constructive knowledge or inquiry notice as of the date of this Agreement.

 

27. Stacking. Each Merchant represents, warrants, and covenants that it will not enter into with any party other than CEDAR any arrangement, agreement, or commitment that relates to or involves the Receivables, whether in the form of a purchase of, a loan against, collateral against, or the sale or purchase of credits against Receivables without the prior written consent of CEDAR.

 

28. Business Purpose. Each Merchant represents, warrants, and covenants that it is a valid business in good standing under the laws of the jurisdictions in which it is organized and/or operates, and each Merchant is entering into this Agreement for business purposes and not as a consumer for personal, family, or household purposes.

 

	I have read and agree to the terms and conditions set forth above:
		/s/ Joseph La Rosa
	Name:	Joseph La Rosa		Title: __________		Date: 05/20/2024

 

 

Page 7 of 12

 

STANDARD MERCHANT CASH ADVANCE AGREEMENT

 

29. Security Interest. Upon an Event of Default, to secure each Merchant’s performance obligations to CEDAR under this Agreement and any future agreement with CEDAR, each Merchant hereby grants to CEDAR a security interest in collateral (the “Collateral”), that is defined as collectively: (a) all accounts, including without limitation, all deposit accounts, accounts-receivable, and other receivables, as those terms are defined by Article 9 of the Uniform Commercial Code (the “UCC”), now or hereafter owned or acquired by any Merchant; and (b) all proceeds, as that term is defined by Article 9 of the UCC. The parties acknowledge and agree that any security interest granted to CEDAR under any other agreement between any Merchant or Guarantor and CEDAR (the “Cross-Collateral”) will secure the obligations hereunder and under this Agreement. Negative Pledge: Each Merchant agrees not to create, incur, assume, or permit to exist, directly or indirectly, any lien on or with respect to any of the Collateral or the Cross-Collateral, as applicable.

 

Each Merchant agrees to execute any documents or take any action in connection with this Agreement as CEDAR deems necessary to perfect or maintain CEDAR’s first priority security interest in the Collateral and the Cross-Collateral, including the execution of any account control agreements. Each Merchant hereby authorizes CEDAR to file any financing statements deemed necessary by CEDAR to perfect or maintain CEDAR’s security interest, which financing statements may contain notification that each Merchant has granted a negative pledge to CEDAR with respect to the Collateral and the Cross-Collateral, and that any subsequent lienor may be tortiously interfering with CEDAR’s rights. Each Merchant shall be liable for and CEDAR may charge and collect all costs and expenses, including but not limited to attorney fees, which may be incurred by CEDAR in protecting, preserving, and enforcing CEDAR’s security interest and rights. Each Merchant further acknowledges that CEDAR may use another legal name and/or D/B/A or an agent when designating the Secured Party when CEDAR files the above-referenced financing statement(s).

 

30. Events of Default. An “Event of Default” may be considered to have taken place if any of the following occur:

 

(1) Any representation or warranty by any Merchant to CEDAR proves to have been made intentionally false or misleading in any material respect when made;

 

(2) Any Merchant causes any ACH debit to the Account by CEDAR to be blocked or stopped without providing any advance written notice to CEDAR with an alternative method for CEDAR to collect the blocked or stopped payment, which notice may be given by e-mail to reconciliations@cedaradvance.com;

 

(3) Any Merchant intentionally prevents CEDAR from collecting any part of the Receivables Purchased Amount; or

 

(4) Any Merchant causes any ACH debit to the Account by any person or entity other than CEDAR to be stopped or otherwise returned that would result in an ACH Return Code of R08, R10, or R29 and that Merchant does not within two business days thereafter provide CEDAR with written notice thereof explaining why that Merchant caused the ACH debit to be stopped or otherwise returned, which notice may be given by e-mail to reconciliations@cedaradvance.com.

 

31. Remedies. In case any Event of Default occurs and is not waived, CEDAR may proceed to protect and enforce its rights or remedies by suit in equity or by action at law, or both, whether for the specific performance of any covenant, agreement, or other provision contained herein, or to enforce the discharge of each Merchant’s obligations hereunder, or any other legal or equitable right or remedy. All rights, powers, and remedies of CEDAR in connection with this Agreement, including each Protection listed in Section 16, may be exercised at any time by CEDAR after the occurrence of an Event of Default, are cumulative and not exclusive, and will be in addition to any other rights, powers, or remedies provided by law or equity. In case any Event of Default occurs and is not waived, CEDAR may elect that Merchant(s) be required to pay to CEDAR 25% of the unpaid balance of the Receivables Purchased Amount as liquidated damages for any reasonable expenses incurred by CEDAR in connection with recovering the unpaid balance of the Receivables Purchased Amount (“Reasonable Expenses”) and all Merchant(s) and all Guarantor(s) agree that the Reasonable Expenses bear a reasonable relationship to CEDAR’s actual expenses incurred in connection with recovering the unpaid balance of the Receivables Purchased Amount.

 

32. Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns, except that Merchant(s) shall not have the right to assign its rights hereunder or any interest herein without the prior written consent of CEDAR, which consent may be withheld in CEDAR’s sole discretion. CEDAR may assign, transfer, or sell its rights under this Agreement, including, without limitation, its rights to receive the Receivables Purchased Amount, and its rights under Section 29 of this Agreement, the Guarantee, and any other agreement, instrument, or document executed in connection with the transactions contemplated by this Agreement (a “Related Agreement”), or delegate its duties hereunder or thereunder, either in whole or in part. From and after the effective date of any such assignment or transfer by CEDAR, whether or not any Merchant has actual notice thereof, this Agreement and each Related Agreement shall be deemed amended and modified (without the need for any further action on the part of any Merchant or CEDAR) such that the assignee shall be deemed a party to this Agreement and any such Related Agreement and, to the extent provided in the assignment document between CEDAR and such assignee (the “Assignment Agreement”), have the rights and obligations of CEDAR under this Agreement and such Related Agreements with respect to the portion of the Receivables Purchased Amount set forth in such Assignment Agreement, including but not limited to rights in the Receivables, Collateral and Additional Collateral, the benefit of each Guarantor’s guaranty regarding the full and prompt performance of every obligation that is a subject of the Guarantee, CEDAR’s rights under Section 16 of this Agreement (Protections Against Default), and to receive damages from any Merchant following a breach of this Agreement by any Merchant. In connection with such assignment, CEDAR may disclose all information that CEDAR has relating to any Merchant or its business. Each Merchant agrees to acknowledge any such assignment in writing upon CEDAR’s request.

 

	I have read and agree to the terms and conditions set forth above:
		/s/ Joseph La Rosa
	Name:	Joseph La Rosa		Title: __________		Date: 05/20/2024

 

 

Page 8 of 12

 

STANDARD MERCHANT CASH ADVANCE AGREEMENT

 

33. Notices. All notices, requests, consents, demands, and other communications hereunder shall be delivered by certified mail, return receipt requested, or by overnight delivery with signature confirmation to the respective parties to this Agreement at their addresses set forth in this Agreement and shall become effective only upon receipt. Written notice may also be given to any Merchant or Guarantor by e-mail to the E-mail Address listed on the first page of this Agreement or by text message to the Phone Number listed on the first page of this Agreement if that phone number is for a mobile phone. Each Merchant and each Guarantor must set its spam or junk mail filter to accept e-mails sent by reconciliations@cedaradvance.com and its domain. This Section is not applicable to service of process or notices in any legal proceedings.

 

34. Choice of Law. Each Merchant acknowledges and agrees that this Agreement was made in the State of Florida, that the Purchase Price is being paid by CEDAR in the State of Florida, that the Receivables Purchased Amount is being delivered to CEDAR in the State of Florida, and that the State of Florida has a reasonable relationship to the transactions encompassed by this Agreement. This Agreement, any dispute or claim relating hereto, whether sounding in contract, tort, law, equity, or otherwise, the relationship between CEDAR and each Merchant, and the relationship between CEDAR and each Guarantor will be governed by and construed in accordance with the laws of the State of Florida, without regard to any applicable principles of conflict of laws. Each Merchant represents that it does not have a principal place of business located in the Commonwealth of Virginia and that therefore the provisions of Chapter 22.1 of Title 6.2 of the Virginia Code are not applicable to this Agreement. Each Merchant agrees that the provisions of Division 9.5 of the California Financial Code are not applicable to this Agreement if no Business Address listed on the first page of this Agreement or in any addendum hereto is located in the State of California.

 

35. Venue and Forum Selection. This Agreement, and any dispute arising out of or relating to this Agreement or the parties’ relationship, shall be governed by and construed in accordance with the laws of the State of Florida, without regard to any applicable principles of conflicts of law. Any suit, action, or proceeding arising out of or relating to this Agreement or the transaction contemplated herein or the interpretation, performance, or breach hereof, shall be instituted in any state court sitting in the State of Florida (the “Acceptable Forums”), provided that CEDAR may institute suit in another forum. Merchant, each Guarantor and each Owner agree that the Acceptable Forums are convenient to them, and submit to the personal jurisdiction of the Acceptable Forums and waive any and all objections to jurisdiction or venue in the Acceptable Forums. Should a proceeding be initiated by Merchant, any Guarantor or any Owner in any other forum, Merchant, each Guarantor and each Owner waives any right to oppose any motion or application made by CEDAR to dismiss such proceeding, to remove and/or transfer the proceeding to an Acceptable Forum, and for an anti-suit injunction against such proceeding (which CEDAR may make in the Acceptable Forums). ADDITIONALLY, MERCHANT, EACH OWNER AND EACH GUARANTOR WAIVE PERSONAL SERVICE OF ANY SUMMONS AND/OR COMPLAINT OR OTHER PROCESS TO COMMENCE ANY LITIGATION AND AGREE THAT SERVICE OF SUCH DOCUMENTS SHALL BE EFFECTIVE AND COMPLETE IF SENT BY PRIORITY MAIL OR FIRST CLASS MAIL TO THE MAILING ADDRESS(ES) SET FORTH FOR MERCHANT ABOVE, AND EMAILED TO THE EMAIL ADDRESS, LISTED ON PAGE 1 OF THIS AGREEMENT OR THE UPDATED MAILING AND EMAIL ADDRESS IN ACCORDANCE WITH PARAGRAPH 33. SERVICE SHALL BE EFFECTIVE AND COMPLETE 5 DAYS AFTER THE MAILING. MERCHANT WILL THEN HAVE 30 CALENDAR DAYS AFTER SERVICE IS COMPLETE IN WHICH TO APPEAR IN THE ACTION OR PROCEEDING.

 

36. Jury Waiver. The parties agree to waive trial by jury in any dispute between them.

 

	I have read and agree to the terms and conditions set forth above:
		/s/ Joseph La Rosa
	Name:	Joseph La Rosa		Title: __________		Date: 05/20/2024

 

 

Page 9 of 12

 

STANDARD MERCHANT CASH ADVANCE AGREEMENT

 

37. Counterclaim Waiver. In any litigation or arbitration commenced by CEDAR, each Merchant and each Guarantor will not be permitted to interpose any counterclaim.

 

38. Statutes of Limitations. Each Merchant and each Guarantor agree that any claim, whether sounding in contract, tort, law, equity, or otherwise, that is not asserted against CEDAR within one year after its accrual will be time barred. Notwithstanding any provision in this Agreement to the contrary, each Merchant and each Guarantor agree that any objection by any of them to the jurisdiction of an arbitrator or to the arbitrability of the dispute and any application made by any of them to stay an arbitration initiated against any of them by CEDAR will be time barred if made more than 20 days after receipt of the demand for arbitration.

 

39. Costs and Legal Fees. If an Event of Default occurs or CEDAR prevails in any litigation or arbitration with any Merchant or any Guarantor, then each Merchant and each Guarantor must pay CEDAR’s reasonable attorney fees, which may include a contingency fee of up to 40% of the amount claimed, as well as administrative or filing fees and arbitrator compensation in any arbitration, expert witness fees, and costs of suit.

 

40. Prejudgment and Postjudgment Interest. If CEDAR becomes entitled to the entry of a judgment against any Merchant or any Guarantor, then CEDAR will be entitled to the recovery of prejudgment interest at a rate of 24% per annum (or 16% per annum if any Merchant is a sole proprietorship), or the maximum rate permitted by applicable law if less, and upon entry of any such judgment, it will accrue interest at a postjudgment rate of 24% per annum (or 16% per annum if any Merchant is a sole proprietorship), or the maximum rate permitted by applicable law if less, which rate will govern over the statutory rate of interest up until actual satisfaction of the judgment.

 

41. Class Action Waiver. CEDAR, each Merchant, and each Guarantor agree that they may bring claims against each other relating to this Agreement only in their individual capacities, and not as a plaintiff or class action member in any purported class or representative proceedings.

 

42. Arbitration. CEDAR HAS THE RIGHT TO REQUEST THAT ANY DISPUTE, CONTROVERSY OR CLAIM BETWEEN CEDAR AND MERCHANT, ANY GUARANTOR OR ANY OWNER, WHETHER ARISING OUT OF OR RELATING TO THE CONSTRUCTION AND INTERPRETATION OF THIS AGREEMENT OR OTHERWISE (INCLUDING WITHOUT LIMITATION CLAIMS FOR FRAUD, MISREPRESENTATION, INTENTIONAL TORT, NEGLIGENT TORT OR UNDER ANY LOCAL, STATE OR FEDERAL STATUTE OR RULE), BE SUBMITTED TO ARBITRATION BEFORE EITHER (I) THE AMERICAN ARBITRATION ASSOCIATION IN ACCORDANCE WITH ITS COMMERCIAL RULES, OR (II) MEDIATION AND CIVIL ARBITRATION INC. D/B/A RAPIDRULING (WWW.RAPIDRULING.COM) IN ACCORDANCE WITH ITS COMMERCIAL ARBITRATION RULES. THE ARBITRATION SHALL BE GOVERNED BY THE FEDERAL ARBITRATION ACT. THE ARBITRATION SHALL BE DEEMED TO BE LOCATED IN MIAMI-DADE COUNTY, FLORIDA, REGARDLESS OF THE LOCATION OF THE PARTIES OR ARBITRATOR. TO THE EXTENT PERMITTED BY THE ARBITRATOR RULES, THE ARBITRATION PROCEEDINGS SHALL PROCEED VIRTUALLY OR REMOTELY AND SHALL NOT REQUIRE THE PARTIES TO APPEAR IN-PERSON. ALL QUESTIONS CONCERNING ARBITRATRABILITY OF ANY DISPUTE SHALL BE DECIDED BY THE ARBITRATOR. CEDAR MAY DEMAND THAT SUCH DISPUTE BE SUBMITTED TO ARBITRATION EITHER BY (I) SENDING A WRITTEN NOTICE OF INTENT TO ARBITRATE TO ALL OTHER PARTIES IN ACCORDANCE WITH THE NOTICE PROVISION IN PARAGRAPH 33 OF THIS AGREEMENT, OR (II) SENDING A WRITTEN NOTICE OF INTENT TO ARBITRATE TO THE ATTORNEY OF RECORD FOR MERCHANT, ANY GUARANTOR OR ANY OWNER WHO HAS BROUGHT ANY ACTION OR PROCEEDING BEFORE ANY COURT OR TRIBUNAL AGAINST CEDAR. INITIALLY, THE PARTIES WILL SPLIT THE ARBITRATION FILING FEE, ADMINISTRATION FEE AND ARBITRATOR FEE. IF CEDAR PREVAILS IN ARBITRATION, THE ARBITRATOR MAY AWARD TO CEDAR ITS ATTORNEYS’ FEES (IN ACCORDANCE WITH PARAGRAPH 39 OF THIS AGREEMENT) AND SHARE OF THE ARBITRATION FILING FEE, ADMINISTRATION FEE AND ARBITRATOR FEE. MERCHANT, ANY GUARANTOR AND ANY OWNER MAY OPT OUT OF THIS ARBITRATION PROVISION BY SENDING CEDAR A NOTICE THAT HE, SHE OR IT DOES NOT WANT THIS PROVISION TO APPLY IN ACCORDANCE WITH PARAGRAPH 33 WITHIN 14 DAYS AFTER THE EFFECTIVE DATE OF THIS AGREEMENT.

 

43. Service of Process. Each Merchant and each Guarantor consent to service of process and legal notices made by First Class or Priority Mail delivered by the United States Postal Service and addressed to the Contact Address set forth on the first page of this Agreement or any other address(es) provided in writing to CEDAR by any Merchant or any Guarantor, and unless applicable law or rules provide otherwise, any such service will be deemed complete upon dispatch. Each Merchant and each Guarantor agrees that it will be precluded from asserting that it did not receive service of process or any other notice mailed to the Contact Address set forth on the first page of this Agreement if it does not furnish a certified mail return receipt signed by CEDAR demonstrating that CEDAR was provided with notice of a change in the Contact Address.

 

	I have read and agree to the terms and conditions set forth above:
		/s/ Joseph La Rosa
	Name:	Joseph La Rosa		Title: __________		Date: 05/20/2024

 

 

Page 10 of 12

 

STANDARD MERCHANT CASH ADVANCE AGREEMENT

 

44. Survival of Representations, etc. All representations, warranties, and covenants herein shall survive the execution and delivery of this Agreement and shall continue in full force until all obligations under this Agreement shall have been satisfied in full and this Agreement shall have terminated unless specified otherwise in this Agreement.

 

45. Waiver. No failure on the part of CEDAR to exercise, and no delay in exercising, any right under this Agreement, shall operate as a waiver thereof, nor shall any single or partial exercise of any right under this Agreement preclude any other or further exercise thereof or the exercise of any other right. The remedies provided hereunder are cumulative and not exclusive of any remedies provided by law or equity.

 

46. Independent Sales Organizations/Brokers. Each Merchant and each Guarantor acknowledge that it may have been introduced to CEDAR by or received assistance in entering into this Agreement or its Guarantee from an independent sales organization or broker (“ISO”). Each Merchant and each Guarantor agree that any ISO is separate from and is not an agent or representative of CEDAR. Each Merchant and each Guarantor acknowledge that CEDAR is not bound by any promises or agreements made by any ISO that are not contained within this Agreement. Each Merchant and each Guarantor exculpate from liability and agree to hold harmless and indemnify CEDAR and its officers, directors, members, shareholders, employees, and agents from and against all losses, damages, claims, liabilities, and expenses (including reasonable attorney and expert fees) incurred by any Merchant or any Guarantor resulting from any act or omission by any ISO. Each Merchant and each Guarantor acknowledge that any fee that they paid to any ISO for its services is separate and apart from any payment under this Agreement. Each Merchant and each Guarantor acknowledge that CEDAR does not in any way require the use of an ISO and that any fees charged by any ISO are not required as a condition or incident to this Agreement.

 

47. Modifications; Agreements. No modification, amendment, waiver, or consent of any provision of this Agreement shall be effective unless the same shall be in writing and signed by all parties.

 

48. Severability. If any provision of this Agreement is deemed invalid or unenforceable as written, it will be construed, to the greatest extent possible, in a manner which will render it valid and enforceable, and any limitation on the scope or duration of any such provision necessary to make it valid and enforceable will be deemed to be part thereof. If any provision of this Agreement is deemed void, all other provisions will remain in effect.

 

49. Headings. Headings of the various articles and/or sections of this Agreement are for convenience only and do not necessarily define, limit, describe, or construe the contents of such articles or sections.

 

50. Attorney Review. Each Merchant acknowledges that it has had an opportunity to review this Agreement and all addenda with counsel of its choosing before signing the documents or has chosen not to avail itself of the opportunity to do so.

 

51. Entire Agreement. This Agreement, inclusive of all addenda, if any, executed simultaneously herewith constitutes the full understanding of the parties to the transaction herein and may not be amended, modified, or canceled except in writing signed by all parties. Should there arise any conflict between this Agreement and any other document preceding it, this Agreement will govern. This Agreement does not affect any previous agreement between the parties unless such an agreement is specifically referenced herein. This Agreement will not be affected by any subsequent agreement between the parties unless this Agreement is specifically referenced therein.

 

	I have read and agree to the terms and conditions set forth above:
		/s/ Joseph La Rosa
	Name:	Joseph La Rosa		Title: __________		Date: 05/20/2024

 

 

Page 11 of 12

 

STANDARD MERCHANT CASH ADVANCE AGREEMENT

 

52. Counterparts; Fax and Electronic Signatures. This Agreement may be executed electronically and in counterparts. Facsimile and electronic copies of this Agreement will have the full force and effect of an original.

 

EACH UNDERSIGNED HEREBY ACCEPTS THE TERMS OF THIS AGREEMENT

 

FOR THE MERCHANT/OWNER (#1)

 

By:	Joseph La Rosa				/s/ Joseph La Rosa
	(Print Name)		(Print Title)		(Signature)

 

SS#

Driver License Number

 

FOR THE MERCHANT/OWNER (#2)

 

By:
	(Print Name)		(Print Title)		(Signature)

 

SS#

Driver License Number

 

Approved for CEDAR ADVANCE LLC by: _______________________________

 

 

Page 12 of 12

 

STANDARD MERCHANT CASH ADVANCE AGREEMENT

 

BANK INFORMATION

 

Dear Merchant,

 

We look forward to being your funding partner.

 

You authorize CEDAR ADVANCE LLC to collect the Receivables Purchased Amount under this Agreement by ACH debiting your bank account with the bank listed below.

 

CEDAR ADVANCE LLC will require viewing access to your bank account each business day. CEDAR ADVANCE LLC will also require viewing access to your bank account, prior to funding, as part of our underwriting process.

 

Please fill out the form below with the information necessary to access your account.

 

* Be sure to indicate capital or lower case letters.

 

Name of bank:

Regions Bank

 

Name of account:

La Rosa Holdings Corp.

 

Account number:

[*]

Routing number:

[*]

 

Bank portal website:

n/a

 

Username:

n/a

 

Password:

n/a

 

Security Question/Answer 1:

n/a

 

Security Question/Answer 2:

n/a

 

Security Question/Answer 3:

n/a

 

Any other information necessary to access your account:

n/a

 

If you have any questions please feel free to contact us directly at 786-605-8900.

 

	I have read and agree to the terms and conditions set forth above:
		/s/ Joseph La Rosa
	Name:	Joseph La Rosa		Title: __________		Date: 05/20/2024

 

 

 

PURCHASED AMOUNT ADDENDUM

 

This addendum is made as of 05/20/2024 (the “Addendum”) to the Agreement for the Purchase and Sale of Future Receipts between CEDAR ADVANCE LLC (the “Buyer”) and THE (the “Seller”) LA ROSA HOLDINGS CORP, Dated 5/20/2024 (the “Agreement”)

 

Buyer and Seller are sometimes referred to herein collectively as the “parties” and each as a “Party”. Whereas, the Parties desire to add certain terms to the Agreement.

 

In consideration of the above promises, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto, intending to be legally bound, do hereby agree and add terms to the Agreement as follows,

 

Purchased amount shall be defined as : $ 630,000.00 if Seller delivers the Future Receipts within 30 calendar days of the Purchase Price being paid by the Buyer

 

Purchased amount shall be defined as : $661,500.00 if Seller delivers the Future Receipts within 45 calendar days of the Purchase Price being paid by the Buyer

 

SELLER:	LA ROSA HOLDINGS CORP
NAME:	JOSEPH LA ROSA
SIGNATURE:	/s/ Joseph La Rosa

 

Cedar Advance, LLC - 2917 AVE I BROOKLYN, NY 11210 – T: 718-400-9030

 

 

 

Exhibit 10.2

 

MEMBERSHIP INTEREST PURCHASE AGREEMENT

 

This Membership Interest Purchase Agreement (this “Agreement”), dated as of May 24, 2024 (the “Effective Date”), by and among LA ROSA HOLDINGS CORP., a Nevada corporation (the “Buyer”), and FRANK DELESLINE III (the “Seller”), and LA ROSA REALTY SUCCESS LLC, a Florida limited liability company located at 2244 E. Semoran Blvd., Apopka, FL 32703 (the “Company,” and together with the Buyer and Seller, the “Parties,” and individually, the “Party”).”

 

RECITALS

 

WHEREAS, the Company is a real estate brokerage duly licensed and registered in the state of Florida (the “Business”);

 

WHEREAS, the Company and La Rosa Franchising LLC, a wholly-owned subsidiary of Buyer (the “LRF”), entered into that certain Franchise Agreement between the Company and the Buyer (the “Franchise Agreement”), pursuant to which the Company operates as a franchisee of LRF;

 

WHEREAS, the Seller, a duly licensed broker in the state of Florida, owns 100% of the outstanding membership interests (the “Membership Interests”) of the Company;

 

WHEREAS, the Seller desires to sell the Membership Interests listed on Schedule A attached hereto (the “Interests”) to the Buyer, and the Buyer wishes to purchase such Interests pursuant to the terms and conditions of this Agreement; and

 

WHEREAS, the Seller and the Buyer entered into that certain Letter of Intent dated October 30, 2023 (the “Letter of Intent”) to set forth the general terms and conditions for the proposed acquisition of the Interests by the Seller;

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

 

ARTICLE I
PURCHASE AND SALE

 

Section 1.01 Purchase and Sale. Subject to the terms and conditions set forth herein, at the Closing (as defined in Section 1.02), the Seller shall sell to the Buyer, and the Buyer shall purchase from Seller, all of Seller’s right, title, and interest in and to the Interests listed in Schedule A attached hereto, free and clear of any Encumbrances (as defined below), for the consideration listed on and pursuant to the terms listed on Schedule A attached hereto (the “Transaction”). For purposes of this Agreement, all of Seller’s right, title, and interest in and to the Membership Interests include, but are not limited to (a) Seller’s capital accounts in the Company; (b) Seller’s right to share in the profits and losses of the Company; (c) Seller’s right to receive distributions from the Company; and (d) the exercise of all member rights, including the voting rights attributable to the Membership Interests. “Encumbrance” means any charge, claim, community property interest, pledge, condition, equitable interest, lien (statutory or other), option, security interest, mortgage, easement, encroachment, right of first refusal, or restriction of any kind, including any restriction on use, voting, transfer, receipt of income or exercise of any other attribute of ownership. The aggregate purchase price for the Interests is set forth on Schedule A attached hereto (the “Purchase Price”).

 

Section 1.02 Closing. The consummation of the Transaction shall occur at a time and place agreed to by the Parties but in any case not later than June 1, 2024 (the “Closing”). The Parties agree that this Agreement shall automatically terminate if the Closing does not occur by June 1, 2024 (the “Drop Dead Date”).

 

Section 1.03 Closing Deliverables. By or on the date of the Closing (the “Closing Date”), the Seller shall deliver to the Buyer:

 

a) A copy of an entry in the membership transfer ledger of the Company confirming the transfer of the Interests from the Seller to the Buyer;

 

 

b) The Operating Agreement of the Company, duly executed by the Seller, the form of which is attached hereto as Exhibit A;

 

c) The Leak-Out Agreement executed by the Seller, the form of which is attached hereto as Exhibit B;

 

d) The Seller’s Certificate, executed by the Seller, in the form reasonably acceptable to the Buyer;

 

e) The Proxy Agreement, executed by the Seller and the Company, the form of which is attached hereto as Exhibit C; and

 

f)   Such other documents as reasonably requested by the Buyer. The Seller also undertakes to transfer to the Buyer all original books and records of the Company on the Closing Date or immediately prior to that date.

 

Section 1.04 Taxes.

 

(a) Transfer Taxes. Seller shall pay or reimburse Buyer for any sales, use, or transfer taxes, documentary charges, recording fees, or similar taxes, charges, fees, or expenses, if any, that become due and payable as a result of the transactions contemplated by this Agreement.

 

(b) Withholding Taxes. Buyer shall be entitled to deduct and withhold from the Purchase Price all taxes that Buyer and the Company may be required to deduct and withhold under any provision of tax law. All such withheld amounts shall be treated as delivered to Seller hereunder.

 

ARTICLE II

REPRESENTATIONS AND WARRANTIES

 

Section 2.01 Seller and Company Representations. The Seller and the Company jointly and

severally represent and warrant to the Buyer as follows:

 

(a)

the Seller owns 100% of Membership Interests free and clear of all Encumbrances, and the Seller is the sole Manager of the Company;

 

(b)

the Company is a limited liability company, duly organized, validly existing, and in good standing under the laws of the state of Florida.

 

(c)

the Company is duly qualified to do business and is in good standing in every jurisdiction in which such qualification is required for purposes of this Agreement, except where the failure to be so qualified, in the aggregate, would not reasonably be expected to have a Material Adverse Effect on its ability to perform its obligations under this Agreement. For the purposes of this Agreement, “Material Adverse Effect” shall mean any change, event, occurrence, condition, or effect that, individually or in the aggregate, (a) has or would reasonably be expected to have a material adverse effect on the financial condition, results of operations, or business prospects of the Company, or (b) would reasonably be expected to materially impair the ability of the Company to perform its obligations under this Agreement in any material respect;

 

(d)

the Company and Seller have the full right, power, and authority to enter into this Agreement, and to perform their obligations hereunder;

 

 

(e)

the execution and delivery of this Agreement by the Company and the Seller, the consummation of the Transaction contemplated hereby, and the performance of the obligations pursuant to this Agreement will not violate, conflict with, require the consent under or result in any breach or default under (i) any of the Company organizational documents (including its articles of organization and limited liability company operating agreement, if any) or (ii) any applicable law; or (iii) the provisions of any material contract or agreement to which Company or Seller is a party or to which any of its material assets are bound (the “Company Contracts”);

 

(f)

there are no outstanding preemptive rights, rights of first refusal, or other similar provisions prohibiting the Seller from entering into this Agreement and consummating the transactions contemplated thereby;

 

(g)

the Company is duly licensed as a real estate brokerage by the Florida Real Estate Commission (the “FREC”) and is in good standing with the FREC, maintaining all necessary licenses and regulatory approvals required for conducting its business in accordance with applicable laws and regulations;

 

(h)

the Seller is a real estate agent duly licensed with the FREC and is in good standing, there are no disciplinary proceedings and, to the knowledge of the Seller, pending or threatened disciplinary proceedings against him;

 

(i)

there is no Action of any nature pending or, to Seller’s knowledge, threatened against or by the Seller that challenges or seeks to prevent, enjoin, or otherwise delay the transactions contemplated by this Agreement. “Action” means any FREC disciplinary hearing, claim, action, cause of action, demand, lawsuit, arbitration, inquiry, audit, notice of violation, proceeding, litigation, citation, summons, subpoena, or investigation of any nature, civil, criminal, administrative, regulatory or otherwise, whether at law or in equity;

 

(j)

the Company and Seller are in compliance with all applicable laws and regulations and Company Contracts relating to this Agreement and the operation of the Business;

 

(k)

the Company and Seller have obtained all licenses, authorizations, approvals, consents, releases, waivers, or permits required by applicable laws, including, but not limited to, those from FREC, governmental authorities and other third parties, required or necessary to conduct its business generally, to consummate this Transaction, and to perform its obligations under this Agreement;

 

(l)

no broker or finder is entitled to any brokerage, finder’s, or other fee or commission in connection with the transactions contemplated by this Agreement or any ancillary document based upon arrangements made by or on behalf of Buyer;

 

(m)

there are no legal claims pending or, to the Company’s and the Seller’s knowledge, threatened against the Company before or by any governmental body or nongovernmental department, commission, board, bureau, agency or instrumentality or by any other person; there are no outstanding or unsatisfied judgments, orders, decrees or stipulations to which the Company is a party;

 

(n)

all taxes due and owing to any governmental authority by the Company have been paid in full; there has not occurred, nor is there any reasonable probability of the occurrence in the future, of any event or events or any change in the financial condition, business, results of operations or prospects of the Company or otherwise that has (x) interfered with the normal and usual operations of the business or business prospects of the Company or (y) resulted, or could reasonably be expected to result, in a material adverse change in the business, assets, operations, prospects or condition (financial or otherwise) of the Company;

 

 

(o)

The Seller acknowledges that this Agreement and the Transaction shall not relieve the Seller of his obligations under the Franchise Agreement existing prior to consummation of the Transaction. The Company acknowledges that this Agreement and the Transaction shall not relieve the Company of its obligations under the Franchise Agreement.

 

(p)

Securities Laws.

 

(i)

Investment Intent. The Seller is acquiring the shares of common stock of the Buyer included as part of the Purchase Price and as set forth on Schedule A attached hereto (the “Buyer Shares”) solely for the Seller’s own account, for investment purposes, and not with a view to, or for resale in connection with, any distribution of the Buyer Shares. The Seller understands that the Buyer Shares have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities laws, by reason of specific exemptions under the provisions thereof which depend in part upon the investment intent of the Seller and of the other representations made by the Sellers in this Agreement. The Seller understands that the Buyer is relying upon the representations and agreements contained in this Agreement (and any supplemental information) for the purpose of determining whether this transaction meets the requirements for such exemptions from the registration requirements of the Securities Act and any state securities laws.

 

(ii)

Restricted Buyer Shares. The Seller understands that the Buyer Shares are “restricted securities” under the Securities Act and the rules promulgated by the U.S. Securities and Exchange Commission provide in substance that the undersigned may dispose of the Buyer Shares only pursuant to an effective registration statement under the Securities Act or an exemption from the registration requirements of the Securities Act, and the undersigned understands that the Company has no obligation or intention to register any of the Buyer Shares or the offering or sale thereof, or to take action so as to permit offers or sales pursuant to the Securities Act or an exemption from registration thereunder (including pursuant to Rule 144 thereunder).

 

(iii)

Book-Entry. The Buyer Shares issued pursuant to this Agreement shall be held in book-entry form and recorded in the electronic records of the Buyer or its designated transfer agent. The Buyer Shares issued in the book-entry form shall have a note in the book-entry system that all such shares carry the restrictive legend described in Sectio 2.01(n)(iv) of this Agreement.

 

(iv)

Legend on Share Certificates. The share certificates, if issued, evidencing the Buyer Shares shall bear a legend substantially similar to the following:

 

“THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. THE SECURITIES MAY NOT BE OFFERED, SOLD, PLEDGED, OR OTHERWISE TRANSFERRED EXCEPT (1) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OR (2) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE STATE SECURITIES LAWS AND THE SECURITIES LAWS OF OTHER JURISDICTIONS, AND IN THE CASE OF A TRANSACTION EXEMPT FROM REGISTRATION UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT SUCH OTHER APPLICABLE LAWS.”

 

 

Section 2.02  Buyer Representations and Warranties. The Buyer represents and warrants to the Company and Seller that:

 

(a) it is a corporation, duly organized, validly existing, and in good standing under the laws of the state of Nevada;

 

(b) it is duly qualified to do business and is in good standing in the State of Florida and in every other jurisdiction in which such licensing and qualification is required for purposes of this Agreement, except where the failure to be so qualified, in the aggregate, would not reasonably be expected to have a Material Adverse Effect on the business and operation of the Buyer;

 

(c) it has the full right, corporate power, and authority to enter into this Agreement and to perform its obligations hereunder, and the undersigned officer of the Buyer has the proper authority to execute and deliver this Agreement on behalf of the Buyer;

 

(d) no broker or finder is entitled to any brokerage, finder’s, or other fee or commission in connection with the transactions contemplated by this Agreement or any ancillary document based upon arrangements made by or on behalf of Buyer.

 

Section 2.03 NO OTHER REPRESENTATIONS OR WARRANTIES; NON-RELIANCE. EXCEPT FOR THE EXPRESS REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS HEREIN, (A) NEITHER PARTY TO THIS AGREEMENT, NOR ANY OTHER PERSON ON SUCH PARTY’S BEHALF, HAS MADE OR MAKES ANY EXPRESS OR IMPLIED REPRESENTATION OR WARRANTY, EITHER ORAL OR WRITTEN, WHETHER ARISING BY LAW OR OTHERWISE, ALL OF WHICH ARE EXPRESSLY DISCLAIMED, AND (B) EACH PARTY ACKNOWLEDGES THAT IT HAS NOT RELIED UPON ANY REPRESENTATION OR WARRANTY MADE BY THE OTHER PARTY, OR ANY OTHER PERSON ON SUCH PARTY’S BEHALF.

 

ARTICLE III
COVENANTS

 

Section 3.01 Conduct of Business of the Company; Transition Services. During the period commencing on the Effective Date and continuing until the Closing Date, the Company and Seller agree that the Company and Seller shall cause the Company to carry on the Business only in the ordinary course and consistent with past practice. The Seller agrees that for the period of 2 years after the Closing, the Seller will make himself available to the Company and the Buyer to provide the Company and the Buyer with the consulting services to ensure that the transition of the Company to the Buyer does not interrupt the Company and Buyer’s day-to-day business operations.

 

Section 3.02 Access to Properties and Records. The Company and Seller shall provide (or shall cause to be provided) to Buyer and Buyer’s accountants, counsel, and other authorized advisors, with reasonable access, during business hours, to the Company’s premises and properties and its books and records and will cause the Company’s officers to furnish to Buyer and Buyer’s authorized advisors such additional documents as Buyer shall from time to time reasonably request. All such data and information shall be kept confidential by the Buyer and the Company unless and until the transactions contemplated herein are consummated.

 

Section 3.03 Filings with Governmental Entities and the FREC. The Parties shall work together to ensure that the Transaction is consummated pursuant to the statutes and administrative code of the State of Florida and any rules and regulations promulgated by the FREC.

 

 

Section 3.04 Operating Agreement. In connection with this Agreement and the consummation of the Transaction contemplated hereby, the Parties agree to enter into an Operating Agreement, a copy of which is attached hereto as Exhibit A, effective as of the Closing Date.

 

Section 3.05 Franchise Agreement. The Seller and the Company shall continue to fulfill their obligations under the Franchise Agreement.

 

Section 3.06 Leak-Out Agreement and Proxy Agreement. In connection with this Agreement and the consummation of the Transaction contemplated hereby, the Buyer and each Seller agree to enter into a Leak-Out Agreement, the form of which is attached hereto as Exhibit B, effective as of the Closing Date, and to enter into a Proxy Agreement, the form of which is attached hereto as Exhibit C, effective as of the Closing Date.

 

Section 3.07 Non-Competition. The Seller agrees that he shall not, for three (3) years after the Closing Date and payment under the terms of this Agreement, directly or indirectly engage in, have any equity interest in, manage or provide services to, or operate any person, firm, corporation, partnership, or business (whether as a director, officer, employee, agent, representative, partner, security holder, lender, consultant, or otherwise) that engages in any business that directly or indirectly competes with any portion of the Company’s business in the State of Florida.

 

Section 3.08 Non-Solicitation. The Seller agrees that he shall not, for three (3) years after the date of Closing and payment under the terms of this Agreement, for any reason (the “Restriction Period”), directly or indirectly, recruit or otherwise solicit or induce any customer, client, vendor, or supplier of the Company of Buyer to (i) terminate or reduce its arrangement or business with the Company or with Buyer (ii) otherwise change its relationship with the Company or with Buyer. Seller shall not, at any time during the Restriction Period, directly or indirectly, either for himself or for any other person or entity, (A) solicit any employee or independent contractor of the Company or Buyer to terminate their employment or arrangement with the Company or Buyer, or (B) employ any such individual during his or her employment or engagement with the Company or Buyer and for a period of three (3) years after such individual terminates their employment or engagement with the Company or Buyer.

 

Section 3.09. Blue-Pencil. In the event that the terms of Section 3.07 or Section 3.08 are determined by a court of competent jurisdiction to be unenforceable by reason of its duration, geographical scope, breadth, or for any other respect, it shall be interpreted to extend only over the maximum period of time for which it may be enforceable, over the maximum geographical area as to which it may be enforceable, or to the maximum extent in all other respects as to which it may be enforceable, all as determined by such court in such action.

 

Section 3.10 Acknowledgment by Seller. Seller represents that Seller has carefully read and considered the provisions of Section 3.07 and Section 3.08 and, having done so, acknowledges and agrees that the restrictions set forth in Section 3.07 and Section 3.08 are fair and reasonable for the protection of the legitimate business interests of the Buyer, including its subsidiaries.

 

ARTICLE IV

TERMINATION

 

Section 4.01 Termination. This Agreement may be terminated at any time prior to the Closing:

 

(a) by the mutual written consent of the Parties; or

 

(b) by the Buyer or Seller, if there has been a breach, inaccuracy in or failure to perform any representation, warranty, covenant or agreement made by any of the other Party (“Defaulting Party”) pursuant to this Agreement and such breach, inaccuracy or failure has not been cured by the Defaulting Party before the earlier of (i) ten (10) days after such Defaulting Party’s receipt of written notice of such breach from the non-defaulting Party; or (ii) the Drop Dead Date; or immediately if such breach is incapable of being cured by the Defaulting Party.

  

 

Section 4.02 Effect of Termination. In the event of termination of this Agreement in accordance with this Article, this Agreement shall forthwith become void, and there shall be no liability on the part of a Party except that nothing herein shall relieve any Party from liability for any willful breach of any provision of this Agreement.

 

Section 4.03 Survival. Notwithstanding the foregoing, Section 2.02(f), Section 3.07, Section 3.08, Section 3.09, Section 3.10, ARTICLE V, Section 6.03, Section 6.07, Section 6.16, Section 6.17 contained herein shall survive the termination of this Agreement.

 

ARTICLE V

INDEMNIFICATION

 

Section 5.01 The Buyer agrees to indemnify the Company and the Seller and the Seller agrees to indemnify the Buyer, its affiliates, and respective shareholders, members, directors, managers, officers, and employees from and against all claims, judgments, damages, liabilities, settlements, losses, costs, and expenses, including reasonable attorneys’ fees and disbursements (collectively, a “Loss”),

 

(a)  arising from or relating to any inaccuracy in or breach of any of the representations or warranties of the indemnifying party contained in this Agreement or any document delivered in connection herewith, or

 

(b)  any Loss arising from or relating to any breach or non-fulfillment of any covenant, agreement, or obligation to be performed by Seller pursuant to this Agreement or any document delivered in connection herewith.

 

ARTICLE VI
MISCELLANEOUS

 

Section 6.01 Expenses. Except as otherwise provided herein, all costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the Party incurring such costs and expenses.

 

Section 6.02 Further Assurances. Following the Closing, each of the Parties shall execute and deliver such additional documents, instruments, conveyances, and assurances and take such further actions as may be reasonably required to carry out the provisions hereof and give effect to the transactions contemplated by this Agreement.

 

Section 6.03 Notices. Each Party to this Agreement shall deliver all notices, requests, consents, claims, demands, waivers, and other communications under this Agreement (each, a “Notice”) in writing and addressed to the other Party at its address set out below (or to any other address that the receiving Party may designate from time to time in accordance with this section). Each Party to this Agreement shall deliver all Notices by personal delivery, nationally recognized overnight courier (with all fees prepaid), email (with confirmation of transmission), or certified or registered mail (in each case, return receipt requested, postage prepaid.). Except as otherwise provided in this Agreement, a Notice is effective only (a) upon receipt by the receiving party and (b) if the party giving the Notice has complied with the requirements of this Section.

 

If to the Buyer:		La Rosa Holdings Corp.
		1420 Celebration Blvd., 2nd Floor
		Celebration, FL 34747
		Attn: Joseph La Rosa, Chief Executive Officer
		T: (321) 250-1799
		E: joe@larosarealtycorp.com

 

 

with a copy to		Sichenzia Ross Ference Carmel LLP
(which shall not constitute notice):		1185 Avenue of the Americas, 31st Floor
		New York, NY 10036
		Attn: Ross D. Carmel, Esq.
		T: (212) 658-0458
		E: rcarmel@srfc.law
If to the Seller:		Frank Delesline III
		2200 E. Semoran Blvd. Apopka Fl, 32703 Suite 2244
		T: 407-480-0157
		E:  Frank@LrrSuccess.com

 

Section 6.04 Headings. The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.

 

Section 6.05 Severability. Subject to Section 3.09 of this Agreement, if any term or provision of this Agreement is invalid, illegal, or unenforceable in any jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon a determination that any term or other provision is invalid, illegal, or unenforceable, the Parties agree to negotiate in good faith to modify the Agreement so as to effect the original intent of the Parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.

 

Section 6.06 Entire Agreement. This Agreement and the schedules and exhibits hereto to be delivered hereunder constitute the sole and entire agreement of the Parties with respect to the subject matter contained herein and supersede all prior and contemporaneous understandings and agreements, both written and oral, with respect to such subject matter, including but not limited to the Letter of Intent. In the event of any inconsistency between the terms and provisions in the body of this Agreement and the Letter of Intent and other documents delivered in connection herewith, the schedules and exhibits, the terms and provisions in the body of this Agreement shall control.

 

Section 6.07 Attorneys’ Fees. In the event that any Party institutes any legal suit, action, or proceeding, including arbitration, against the other Party to enforce the covenants contained in this Agreement arising out of or relating to this Agreement, the prevailing Party in the suit, action or proceeding shall be entitled to receive, in addition to all other damages to which it may be entitled, the costs incurred by such Party in conducting the suit, action, or proceeding, including reasonable attorneys’ fees and expenses and court costs.

 

Section 6.08 Further Assurances. Each of the Parties hereto shall, and shall cause their respective Affiliates to execute and deliver such additional documents, instruments, conveyances, and assurances and take such further actions as may be reasonably required to carry out the provisions hereof and give effect to the transactions contemplated hereby.

 

Section 6.09 Public Announcements. Unless otherwise required by applicable law (based upon the reasonable advice of counsel), no Party to this Agreement shall make any public announcements in respect of this Agreement or the transactions contemplated hereby or otherwise communicate with any news media without the prior written consent of the other Party, and the Parties shall cooperate as to the timing and contents of any such announcement.

 

Section 6.10 Amendment and Modification. This Agreement may only be amended, modified, or supplemented by an agreement in writing signed by each Party hereto.

 

 

Section 6.11 Waiver. No waiver by any Party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the Party so waiving. No waiver by any Party shall operate or be construed as a waiver in respect of any failure, breach, or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any right, remedy, power, or privilege arising from this Agreement shall operate or be construed as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power, or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power, or privilege.

 

Section 6.12 Equitable Remedies. The Parties agree that irreparable damage would occur if any provision of this Agreement were not performed in accordance with the terms hereof and that the Parties shall be entitled to equitable relief, including injunctive relief or specific performance of the terms hereof, in addition to any other remedy to which they are entitled at law or in equity.

 

Section 6.13 Assignment. No Party may assign any of its rights hereunder without the prior written consent of the other Parties. No assignment shall relieve the assigning Party of any of its obligations hereunder.

 

Section 6.14 Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the Parties hereto and their respective successors and permitted assigns.

 

Section 6.15 No Third-Party Beneficiaries. This Agreement is for the sole benefit of the Parties hereto and their respective successors and permitted assigns, and nothing herein, express or implied, is intended to or shall confer upon any other person or entity any legal or equitable right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.

 

Section 6.16  Governing Law. All matters relating to this Agreement shall be governed by and construed in accordance with the internal laws of the State of Florida without giving effect to any choice or conflict of law provision or rule (whether of the State of Florida or any other jurisdiction).

 

Section 6.17 Submission to Jurisdiction; Waiver of Jury Trial. Any legal suit, action, or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby shall be instituted in the federal courts of the United States of America or the courts of the State of Florida in each case located in the City and County of where the Buyer’s executive offices are located, and each Party irrevocably submits to the non-exclusive jurisdiction of such courts in any such suit, action, or proceeding.

 

EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT, THE ASSIGNMENT, OR THE ANCILLARY DOCUMENTS IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND, THEREFORE, EACH SUCH PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LEGAL ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE ASSIGNMENT, THE OTHER ANCILLARY DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

 

 

Section 6.18 Force Majeure. The Parties shall not be liable or responsible to the other Parties, nor be deemed to have defaulted under or breached this Agreement, for any failure or delay in fulfilling or performing any term of this Agreement (except for any obligations to make payments to the other Parties hereunder), when and to the extent such failure or delay is caused by or results from acts beyond the affected Party’s reasonable control, including, without limitation: (a) acts of God; (b) flood, fire, earthquake, or explosion; (c) war, invasion, hostilities, terrorist threats or acts, riot, or other civil unrest; (d) government order or law; (e) actions, embargoes, or blockades in effect on or after the date of this Agreement; (f) action by any governmental authority; and (g) national or regional emergency (any a “Force Majeure Event”). The Party suffering a Force Majeure Event shall promptly give notice to the other Parties, stating the period of time the occurrence is expected to continue and shall use diligent efforts to end the failure or delay and ensure the effects of such Force Majeure Event are minimized.

 

Section 6.19 Specific Performance. The Parties agree that irreparable damage would occur if any provision of this Agreement were not performed in accordance with the terms hereof and that the Parties shall be entitled to specific performance of the terms hereof, in addition to any other remedy to which they are entitled at law or in equity. Each Party hereto: (a) agrees that it shall not oppose the granting of such specific performance or relief; and (b) hereby irrevocably waives any requirements for the security or posting of any bond in connection with such relief.

 

Section 6.20 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, e-mail, or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

 

Section 6.21 Time of the Essence. Time shall be of the essence in this Agreement.

 

 

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed as of the Effective Date by their respective representatives thereunto duly authorized.

 

	SELLER:
	By:	/s/ Frank Delesline III
	Name:	Frank Delesline III
	COMPANY:
	LA ROSA REALTY SUCCESS LLC
	By:	/s/ Frank Delesline III
	Name:	Frank Delesline III
	Title:	Manager
	BUYER:
	LA ROSA HOLDINGS CORP.
	By:	/s/ Joseph La Rosa
	Name:	Joseph La Rosa
	Title:	Chief Executive Officer

 

 

SCHEDULE A

 

Buyer:		La Rosa Holdings Corp.
Company:		La Rosa Realty Success LLC
Seller:		Frank Delesline III
Percentage of Seller’s Membership Interest in the Company being sold to the Buyer:		51%
Aggregate Purchase Price:		An aggregate of $78,777.85, consisting of (i) a cash payment of $10,000 (the “Cash Payment”), and (ii) $68,777.85 in unregistered (restricted) shares of common stock of the Buyer (the “Purchase Shares”).
Payment Terms:		The Cash Payment shall be payable in accordance with the following schedule:
		- $5,000 - on the Closing Date;
		- $5,000 – on the date that is 30 days after the Closing Date.
		The Purchase Shares will be issued on the Closing Date.
		The number of Purchase Shares will be calculated by dividing the purchase price of the Purchase Shares ($68,777.85) by the closing price of the Company’s common stock as of the trading date immediately preceding the Closing Date, as reported by the Nasdaq Stock Market LLC.

 

 

Exhibit A

 

Operating Agreement

 

 

 

 

 

Exhibit B

 

Leak-Out Agreement

 

 

 

 

 

Exhibit C

 

Proxy Agreement

 

 

 

 

 

 

Exhibit 10.3

 

LEAK OUT AGREEMENT

 

This Leak Out Agreement (the “Leak-Out Agreement”) is dated as of May 24, 2024 and is by and between La Rosa Holdings Corp., a Nevada corporation, whose address is 1420 Celebration Boulevard, 2nd Floor, Celebration, Florida 34747 (the “Company”), and Frank Delesline III, whose address is 5439 Hyde Park Avenue, Orlando, FL 32808 (the “Holder”). Each of the Company and the Holder is a “party” to this Agreement, and together, they are the “parties” hereto.

 

Reference is hereby made to that certain Membership Interest Purchase Agreement between the Company, La Rosa Realty Success LLC, and the Holder dated May 24, 2024 (the “Purchase Agreement”). The Holder is to receive a number of shares of the Company’s common stock, $0.0001 par value per share (“Common Stock”), pursuant to the Purchase Agreement. The Holder agrees hereby to sell the Common Stock received pursuant to the Purchase Agreement only as permitted hereby during the Leak Period (defined below). Any other sales shall be a material breach of this Agreement.

 

The Holder agrees with the Company that the leak out period (the “Leak-Out Period”). shall start on the date that is the 181^st day after the date of the closing (the “Closing Date”) of the acquisition per the Purchase Agreement, which should be the date when the Company issues to the Holder the shares of its Common Stock pursuant to the Purchase Agreement(the “Start Date”) and shall end at 5:00 p.m., Eastern Time, on the date that is 366 days following the Start Date (“End Date”). So, for a hypothetical example, if the Closing Date is January 1, 2025, the Start Date of the Leak Out Period would be July 1, 2025 and the End Date of the Leak Out Period would be July 2, 2026. During the Leak Out Period, the Holder shall be entitled to sell, dispose, transfer, assign, pledge or hypothecate or enter into any such transaction to such effect, directly or indirectly, (including, without limitation, any sales, short sales, swaps or any derivative transactions that would be equivalent to any sales or short positions) (each a “Disposition”) an amount of shares of Common Stock equal to one twelfth (1/12^th) of the total amount of the shares of Company’s Common Stock that Holder has received pursuant to the Purchase Agreement per calendar month. (So, for example, if the Holder received 120 shares of Common Stock pursuant to the Purchase Agreement, the Holder could, during the Leak Out Period, sell up to 10 shares of Common Stock per calendar month). After the End Date, the Holder would not have any restriction on the number of shares that may be subject to Disposition.

 

The Holder understands and agrees that that the Common Stock received pursuant to the Purchase Agreement are “restricted securities” under applicable federal securities laws and that the Securities Act of 1933, as amended (“Securities Act”), and the rules of the U.S. Securities and Exchange Commission provide in substance that the Holder may dispose of the Common Stock only pursuant to an effective registration statement under the Securities Act or an exemption from the registration requirements of the Securities Act, and the undersigned understands that the Company has no obligation or intention to register any of the shares of Common Stock obtained under the Purchase Agreement or the offering or sale thereof, or to take action so as to permit offers or sales pursuant to the Securities Act or an exemption from registration thereunder (including pursuant to Rule 144 thereunder).

 

 

The Company agrees to give to the Company’s transfer agent or counsel any and all instructions intended to facilitate Dispositions under this Leak-Out Agreement.  

 

Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Leak-Out Agreement must be in writing and sent by certified mail, return receipt requested or via overnight courier (such as UPS or FEDEX) to the party whose address is set forth in the first paragraph hereof.

 

This Leak-Out Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior negotiations, letters, emails, agreements (written or oral) and understandings relating to the subject matter hereof and are fully binding on the parties hereto.

 

This Leak-Out Agreement may be executed simultaneously in any number of counterparts. Each counterpart shall be deemed to be an original, and all such counterparts shall constitute one and the same instrument. This Leak-Out Agreement may be executed and accepted by facsimile or PDF signature and any such signature shall be of the same force and effect as an original signature.

 

The terms of this Leak-Out Agreement shall be binding upon and shall inure to the benefit of each of the parties hereto and their respective heirs, estates, personal representatives, successors and assigns.

 

This Leak-Out Agreement may not be amended or modified except in writing signed by each of the parties hereto.

 

This Leak-Out Agreement shall be governed by, and construed in accordance with, the laws of the State of Florida, without regard to conflict of law principles that would result in the application of any law other than the law of the State of Florida.

 

Any claim, suit, or proceeding arising, in whole or in part, out of, in relation to, or in connection with this Leak-Out Agreement, including without limitation any dispute as to the construction, validity, interpretation, enforceability, performance, expiry, termination, or breach of this Leak-Out Agreement, whether based on contract, tort, or otherwise, shall be subject to the exclusive jurisdiction of the state or federal courts in the County of Osceola, Florida. In connection with any such dispute, controversy or claim, the parties, unconditionally and irrevocably (i) submit to the jurisdiction of the state and federal courts located in the County of Osceola, Florida; (ii) waive any and all objection that they may now or hereafter have based on venue and/or forum non conveniens in any suit brought in any state or federal court located in the County of Osceola, Florida; and (iii) waive any right to a jury trial for any dispute, controversy, or claim arising out of, in relation to, or in connection with this Leak-Out Agreement.

 

[SIGNATURES APPEAR ON THE NEXT PAGE.]

 

 

IN WITNESS WHEREOF, this Agreement has been duly executed by or on behalf of the parties to this Agreement as of the date first above written.

 

	La Rosa Holdings Corp.
	By:	/s/ Joseph La Rosa
		Name:	Joseph La Rosa
		Title:	Chief Executive Officer
	HOLDER:
	By:	/s/ Frank Delesline III
		Name:	Frank Delesline III

 

 

Frank Delesline III - Leak Out Agreement

Page 3

 

v3.24.1.1.u2

Cover	May 20, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	May 20, 2024
Entity File Number	001-41588
Entity Registrant Name	La Rosa Holdings Corp.
Entity Central Index Key	0001879403
Entity Tax Identification Number	87-1641189
Entity Incorporation, State or Country Code	NV
Entity Address, Address Line One	1420 Celebration Blvd.,
Entity Address, Address Line Two	2nd Floor
Entity Address, City or Town	Celebration
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	34747
City Area Code	321
Local Phone Number	250-1799
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $0.0001 par value
Trading Symbol	LRHC
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	false

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