La Rosa Holdings Corp.

Previous wording

In addition to providing person-to-person residential and commercial real estate brokerage services to the public, we cross-sell ancillary technology-based products and services primarily to our sales agents and the sales agents associated with our franchisees. Our business is organized based on the services we provide internally to our agents and to the public, which are residential and commercial real estate brokerage, franchising, real estate brokerage education and coaching, property management, and title services. Our real estate brokerage business operates primarily under the trade name La Rosa Realty. We have 26 La Rosa Realty corporate real estate brokerage offices and branches located in Florida, California, Texas, Georgia, North Carolina and Puerto Rico. The Company also has 6 La Rosa Realty franchised real estate brokerage offices and branches and 3 affiliated real estate brokerage offices, that pay us fees in 7 states in the United States and Puerto Rico. We also have recently opened LR Realty Spain, which is a full-service brokerage office located primarily in Malaga, Spain. Additionally, the Company has a full-service escrow settlement and title company in Florida.

Current wording

In addition to providing person-to-person residential and commercial real estate brokerage services to the public, we cross-sell ancillary technology-based products and services primarily to our sales agents and the sales agents associated with our franchisees. Our business is organized based on the services we provide internally to our agents and to the public, which are residential and commercial real estate brokerage, franchising, real estate brokerage education and coaching, property management, and title services. Our real estate brokerage business operates primarily under the trade name La Rosa Realty. We have 25 La Rosa Realty corporate real estate brokerage offices and branches located in Florida, California, Texas, Georgia, North Carolina and Puerto Rico. The Company also has 5 La Rosa Realty franchised real estate brokerage offices and branches and 3 affiliated real estate brokerage offices, that pay us fees in 7 states in the United States and Puerto Rico. We also have LR Realty Spain, which is a full-service brokerage office located primarily in Malaga, Spain. Additionally, the Company has a full-service escrow settlement and title company in Florida.

Previous wording

Our real estate brokerage offices, both corporate and franchised, are staffed with 3,001 licensed real estate brokers and sales associates as of June 30, 2025.

Current wording

Our real estate brokerage offices, both corporate and franchised, are staffed with 3,116 licensed real estate brokers and sales associates as of September 30, 2025.

Previous wording

On October 12, 2023, we consummated our IPO. Following our IPO, during the fiscal year ended December 31, 2023, we acquired majority ownership of the following franchisees of the Company: Nona Legacy Powered By La Rosa Realty, Inc. (formerly, La Rosa Realty Lake Nona Inc.), Horeb Kissimmee Realty, LLC, La Rosa Realty Premier, LLC, La Rosa Realty Orlando, LLC, and 100% ownership of the following franchisees of the Company: La Rosa CW Properties, LLC and La Rosa Realty North Florida LLC. In December 2023, we also formed our majority owned subsidiary La Rosa Realty Texas LLC. During the fiscal year ended December 31, 2024, we acquired majority ownership of the following franchisees and affiliates of the Company: La Rosa Realty Georgia LLC, La Rosa Realty California, La Rosa Realty Lakeland LLC DBA La Rosa Realty Prestige, and La Rosa Realty Success LLC, and 100% ownership of La Rosa Realty Winter Garden LLC, BF Prime LLC, Nona Title Agency LLC, La Rosa Realty Beaches LLC, and Baxpi Holdings. Additionally, we acquired the remaining non-controlling interest portions of Nona Legacy Powered By La Rosa Realty, Inc. (formerly, La Rosa Realty Lake Nona Inc.) and La Rosa Realty Premier, LLC, making them both 100% owned entities.

Current wording

On October 12, 2023, we consummated our IPO. Following our IPO, during the fiscal year ended December 31, 2023, we acquired majority ownership of the following franchisees of the Company: Nona Legacy Powered By La Rosa Realty, Inc. (formerly, La Rosa Realty Lake Nona Inc.), Horeb Kissimmee Realty, LLC, La Rosa Realty Premier, LLC, La Rosa Realty Orlando, LLC, and 100% ownership of the following franchisees of the Company: La Rosa CW Properties, LLC and La Rosa Realty North Florida LLC. In December 2023, we also formed our majority owned subsidiary La Rosa Realty Texas LLC. During the fiscal year ended December 31, 2024, we acquired majority ownership of the following franchisees and affiliates of the Company: La Rosa Realty Georgia LLC, La Rosa Realty California, La Rosa Realty Lakeland LLC DBA La Rosa Realty Prestige, and La Rosa Realty Success LLC, and 100% ownership of La Rosa Realty Winter Garden LLC, BF Prime LLC, Nona Title Agency LLC, La Rosa Realty Beaches LLC, and Baxpi Holdings LLC. Additionally, we acquired the remaining non-controlling interest portions of Nona Legacy Powered By La Rosa Realty, Inc. (formerly, La Rosa Realty Lake Nona Inc.) and La Rosa Realty Premier, LLC, making them both 100% owned entities.

Previous wording

On November 22, 2024, the Company entered into a sales agreement (“ATM Agreement”) with A.G.P./Alliance Global Partners, as sales agent, relating to the sale of common stock. During the three month ended June 30, 2025, the Company issued an aggregate of 218,918 shares of common stock pursuant to such ATM Agreement for net proceeds of $3,741,282. The Company paid the sales agent compensation with respect to sale of such shares in the amount of $151,947.

Current wording

On November 22, 2024, the Company entered into a sales agreement (“ATM Agreement”) with A.G.P./Alliance Global Partners, as sales agent, relating to the sale of common stock. During the three month ended September 30, 2025, the Company issued an aggregate of 75,000 shares of common stock pursuant to the ATM Agreement for net proceeds of $838,390. The Company paid the sales agent compensation with respect to sale of such shares in the amount of $25,935.

Previous wording

On August 4, 2025 (the “Agreement Date”), the Company entered into the Equity Purchase Facility Agreement (“Facility Agreement”) with an institutional investor (the “Facility Investor”), pursuant to which the Facility Investor committed to purchase, subject to certain conditions and limitations, up to $150,000,000 (the “Commitment Amount”) in newly issued shares of the common stock of the Company (the “Facility”). In connection with the Facility, on the Agreement Date the Company also entered into a Registration Rights Agreement (the “RRA”) with the Facility Investor.

Current wording

On August 4, 2025 (the “Original Agreement Date”), the Company entered into the Equity Purchase Facility Agreement (“Existing Facility Agreement”) with an institutional investor (“Facility Investor”), pursuant to which the Facility Investor committed to purchase, subject to certain conditions and limitations, up to $150,000,000 (the “Commitment Amount”) in newly issued shares of the common stock of the Company (the “Facility”). In connection with the Facility, on the Original Agreement Date the Company entered into a Registration Rights Agreement (the “Existing RRA”) with the Facility Investor.

Previous wording

Pursuant to the terms of the Facility Agreement, the issuance of shares of common stock in excess of 19.99% of the Company’s outstanding shares of common stock is conditional upon obtaining the approval of the Company’s stockholders in accordance with the rules and regulations of the Nasdaq Capital Market. On August 6, 2025, the stockholders, holding approximately 96.3% of the votes of our outstanding voting stock approved the Facility Agreement and RRA, including, but not limited to the issuance of the shares of common stock in excess of 19.99% of the Company’s issued and outstanding common stock at a price less than the minimum price required by the Nasdaq Capital Market, in compliance with the rules and regulations of the Nasdaq Capital Market. On August 8, 2025, the Company filed a preliminary information statement on Schedule 14C with the SEC notifying stockholders of such approval. The Company filed a definitive information statement on Schedule 14C with the SEC and commenced mailing of the definitive information statement to stockholders of record on August 18, 2025. Such stockholders’ approval will become effective 20 calendar days after commencement of mailing, or September 7, 2025.

Current wording

Pursuant to the terms of the Existing Facility Agreement, the issuance of shares of common stock in excess of 19.99% of the Company’s outstanding shares of common stock was conditional upon obtaining the approval of the Company’s stockholders in accordance with the rules and regulations of the Nasdaq Capital Market. On August 6, 2025, the stockholders, holding approximately 96.3% of the votes of our outstanding voting stock approved the Existing Facility Agreement and Existing RRA, including, but not limited to the issuance of the shares of common stock in excess of 19.99% of the Company’s issued and outstanding common stock at a price less than the minimum price required by the Nasdaq Capital Market, in compliance with the rules and regulations of the Nasdaq Capital Market. On August 8, 2025, the Company filed a preliminary information statement on Schedule 14C with the SEC notifying stockholders of such approval. The Company filed a definitive information statement on Schedule 14C with the SEC and commenced mailing of the definitive information statement to stockholders of record on August 18, 2025. Such stockholders’ approval became effective on September 7, 2025. In accordance with the terms of the Existing RRA, on August 11, 2025, the Company filed with the SEC a Registration Statement on Form S-1 (Reg. No. 333-289503) to register up to 100,000,000 shares of common stock issuable pursuant to the Existing Facility Agreement. Such registration statement, as amended, was declared effective by the SEC on August 22, 2025.

Previous wording

On February 4, 2025 (“Closing Date”), we entered into the SPA with an institutional investor (“2025 Investor”) pursuant to which we agreed to issued and sell to the 2025 Investor upon the terms and conditions set forth in the SPA on such date: (i) a Senior Secured Convertible Note in the original principal amount of $5,500,000 which matures on the two-year anniversary of the Closing Date (the “Initial Note”); and (ii) sixteen (16) warrants (the “Incremental Warrants”), each to purchase additional Notes in an original principal amount up to $2,500,000 at an exercise price of $2,256,250, in substantially the same form as the Initial Note (Incremental Notes and together with the Initial Note, the “Notes”). The Incremental Warrants and Initial Note were issued to 2025 Investor on the Closing Date. The purchase price paid by 2025 Investor under the SPA for the Initial Note and Incremental Warrants was $4,963,750, which was used by the Company to pay-off certain indebtedness, pay certain outstanding fees and expenses, acquisitions and general corporate purposes. The Company also granted 2025 Investor registration rights in the shares of common stock issuable pursuant to the SPA and conversion of the Notes. The Company and its subsidiaries also entered into a security agreement with or in favor of the 2025 Investor pursuant to which the Company and its subsidiaries granted the 2025 Investor a security interest in certain property of the Company and its subsidiaries to secure the Company’s obligations under the Notes. The Company also agreed to obtain stockholder approval for the issuance of more than 19.99% of the issued and outstanding common stock in this financing.

Current wording

On February 4, 2025 (“Closing Date”), the Company entered into the SPA with an institutional investor (“2025 Investor”) pursuant to which it agreed to issue and sell to the 2025 Investor upon the terms and conditions set forth in the SPA on such date: (i) a Senior Secured Convertible Note in the original principal amount of $5,500,000 which matures on the two-year anniversary of the Closing Date (the “Initial Note”); and (ii) sixteen (16) warrants (the “Incremental Warrants”), each to purchase additional Notes in an original principal amount up to $2,500,000 at an exercise price of $2,256,250, in substantially the same form as the Initial Note (Incremental Notes and together with the Initial Note, the “Notes”). The Incremental Warrants and Initial Note were issued to 2025 Investor on the Closing Date. The purchase price paid by 2025 Investor under the SPA for the Initial Note and Incremental Warrants was $4,963,750, which was used by the Company to pay-off certain indebtedness, pay certain outstanding fees and expenses, acquisitions and general corporate purposes. The Company also granted 2025 Investor registration rights in the shares of common stock issuable pursuant to the SPA and conversion of the Notes. The Company and its subsidiaries also entered into a security agreement with or in favor of the 2025 Investor pursuant to which the Company and its subsidiaries granted the 2025 Investor a security interest in certain property of the Company and its subsidiaries to secure the Company’s obligations under the Notes. The Company also agreed to obtain stockholder approval for the issuance of more than 19.99% of the issued and outstanding common stock in this financing.

Previous wording

On October 10, 2024, the Company received a letter from the Nasdaq Listing Qualifications Department notifying us that, for the 30 consecutive business day period between August 28, 2024 through October 9, 2024, our common stock had not maintained a minimum closing bid price of $1.00 per share required for continued listing on The Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Rule”). On July 21, 2025, the Company received a letter from Nasdaq confirming that the Nasdaq Listing Qualifications Department has determined that for the last 10 consecutive business days, from July 7 through July 18, 2025, the closing bid price of the Company’s common stock has been at $1.00 per share or greater. Accordingly, the Company has regained compliance with the Bid Price Rule, and this matter is now closed.

Current wording

On October 10, 2024, the Company received a letter from the Nasdaq Listing Qualifications Department stating that, for the 30 consecutive business day period between August 28, 2024 through October 9, 2024, the Company’s common stock had not maintained a minimum closing bid price of $1.00 per share required for continued listing on The Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Rule”). On July 21, 2025, the Company received a letter from Nasdaq confirming that the Nasdaq Listing Qualifications Department has determined that for the 10 consecutive business days, from July 7 through July 18, 2025, the closing bid price of the Company’s common stock was at $1.00 per share or greater. Accordingly, the Company regained compliance with the Bid Price Rule, and the matter is now closed.

Previous wording

On May 30, 2025, the Company received a letter from Nasdaq indicating that, because the Company’s stockholders’ equity as reported in its Quarterly Report on Form 10-Q for the period ended March 31, 2025 was $(83,377,044), the Company is no longer in compliance with Nasdaq Listing Rule 5550(b)(1), which requires companies listed on The Nasdaq Capital Market to maintain a minimum of $2,500,000 in stockholders’ equity for continued listing.

Current wording

On May 30, 2025, the Company received a letter from Nasdaq indicating that, because the Company’s stockholders’ equity as reported in its Quarterly Report on Form 10-Q for the period ended March 31, 2025 was $(83,377,044), the Company is no longer in compliance with Nasdaq Listing Rule 5550(b)(1), which requires companies listed on The Nasdaq Capital Market to maintain a minimum of $2,500,000 in stockholders’ equity for continued listing. On August 21, 2025, the Company received a letter from Nasdaq confirming that the Nasdaq Listing Qualifications Department has determined that the Company complies with Nasdaq Listing Rule 5550(b)(1) based on the Company’s Form 10-Q for the period ended June 30, 2025, evidencing stockholders’ equity of $7,595,799, and the matter is now closed.

Previous wording

As of December 31, 2024, the Company qualified as a “controlled company” because more than 50% of the voting power for the election of directors was held by Joseph La Rosa, our Chief Executive Officer and Chairman. As a result of certain sales under the Company’s previously announced at-the-market offering, as of April 16, 2025 Mr. La Rosa no longer held more than 50% of the voting power for the election of directors. As a result, the Company was no longer considered a “controlled company” for the purposes of the listing requirements of the Nasdaq Capital Market. Since the Company did not avail itself of certain of the controlled company exemptions afforded by Nasdaq to controlled companies, such change in the Company’s status did not result in any corporate governance changes for the Company. The Company regained a “controlled company” status on July 7, 2025 because as a result of Reverse Stock Split, Mr. Joseph La Rosa became a holder of more than 50% of the voting power of the Company.

Current wording

As of December 31, 2024, the Company qualified as a “controlled company” because more than 50% of the voting power for the election of directors was held by Joseph La Rosa, our Chief Executive Officer and Chairman. As a result of certain sales under the Company’s previously announced at-the-market offering, as of April 16, 2025, Mr. La Rosa no longer held more than 50% of the voting power for the election of directors. As a result, the Company was no longer considered a “controlled company” for the purposes of the listing requirements of the Nasdaq Capital Market. Since the Company did not avail itself of certain of the controlled company exemptions afforded by Nasdaq to controlled companies, such change in the Company’s status did not result in any corporate governance changes for the Company. On July 7, 2025, the Company regained a “controlled company” status as a result of a Reverse Stock Split that provided Mr. Joseph La Rosa with possession of more than 50% of the voting power of the Company.

Previous wording

Our financial results are primarily driven by the total number of sales agents in our Company, the number of sales agents closing residential real estate transactions, the number of sales agents utilizing our coaching services, the number of agents who work with our franchisees, and the number of properties under management. We increased our agent count by 18.4%, from 2,535 at June 30, 2024 to 3,001 at June 30, 2025.

Current wording

Our financial results are primarily driven by the total number of sales agents in our Company, the number of sales agents closing residential real estate transactions, the number of sales agents utilizing our coaching services, the number of agents who work with our franchisees, and the number of properties under management. We increased our agent count by 17.7%, from 2,647 at September 30, 2024 to 3,116 at September 30, 2025.

Previous wording

The U.S. Federal Reserve continues to take action intended to address inflation. The Federal Reserve Board maintained the federal funds rate at 533 basis points from August of 2023 through mid-September 2024, when it was reduced to 483 basis points. In June 2025, the federal funds rate was 433 basis points. The fluctuations impact interest rates, which significantly contribute to mortgage rate adjustments. During the second half of 2022, the benchmark 30 year fixed conforming mortgage rate rose above 6% for the first time since 2008, according to Freddie Mac data, and reached a peak of about 8% during the second half of 2023. That interest rate sat in between 6.62% and 6.85% during 2024 and was 6.77% by the end of June 2025. Consequently, housing demand remained soft, prices are rising, consumer sentiment has weakened, and home sales are declining. In June 2025, existing-home sales fell 2.7% month-over-month to a seasonally adjusted rate of 3.93 million. Year-over-year, sales remained constant. According to National Association of Realtors Chief Economist Lawrence Yun, “Multiple years of undersupply are driving the record high home price. Home construction continues to lag population growth. This is holding back first-time home buyers from entering the market. More supply is needed to increase the share of first-time homebuyers in the coming years even though some markets appear to have a temporary oversupply at the moment.”

Current wording

The U.S. Federal Reserve continues to take action intended to address inflation. The Federal Reserve Board maintained the federal funds rate at 533 basis points from August of 2023 through mid-September 2024, when it was reduced to 483 basis points. In September 2025, the federal funds rate was 422 basis points. The fluctuations impact interest rates, which significantly contribute to mortgage rate adjustments. During the second half of 2022, the benchmark 30 year fixed conforming mortgage rate rose above 6% for the first time since 2008, according to Freddie Mac data, and reached a peak of about 8% during the second half of 2023. That interest rate sat in between 6.62% and 6.85% during 2024 and fell to 6.30% by the end of September 2025. In September 2025, existing-home sales rose 1.5% month-over-month to a seasonally adjusted rate of 4.06 million. Year-over-year, sales rose 4.1%. Total homes for sale were 1.6 million, a rise of 14% over last year, with a median sales price of $415,200, a 2.1% rise over last year. According to NAR Chief Economist Lawrence Yun, “As anticipated, falling mortgage rates are lifting home sales. Improving housing affordability is also contributing to the increase in sales.”

Previous wording

The recently adopted SEC cybersecurity disclosure rules for public companies require disclosure regarding cybersecurity risk management (including the corporate board’s role in overseeing cybersecurity risks, management’s role and expertise in assessing and managing cybersecurity risks, and processes for assessing, identifying and managing cybersecurity risks) in annual reports. These new cybersecurity disclosure rules also require the disclosure of material cybersecurity incidents in a Form 8-K, generally within four days of determining an incident is material. We have included respective disclosures in our Annual Report on Form 10-K for fiscal year ended December 31, 2024 filed with the Commission on April 15, 2025.

Current wording

The SEC cybersecurity disclosure rules for public companies require disclosure regarding cybersecurity risk management (including the corporate board’s role in overseeing cybersecurity risks, management’s role and expertise in assessing and managing cybersecurity risks, and processes for assessing, identifying and managing cybersecurity risks) in annual reports. These cybersecurity disclosure rules also require the disclosure of material cybersecurity incidents in a Form 8-K, generally within four days of determining an incident is material. We have included respective disclosures in our Annual Report on Form 10-K for fiscal year ended December 31, 2024 filed with the Commission on April 15, 2025.

Previous wording

A critical accounting estimate is one that is both important to the portrayal of a company’s financial condition and results of operations and requires management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. During the six-months ended June 30, 2025, the Company entered into a securities purchase agreement providing for the issuance of a convertible note and incremental warrants which required a fair value evaluation under ASC 825. This evaluation constituted an additional critical accounting estimate to the Company. SeeNote 4 Fair Value Measurements and Other LiabilitiesandNote 5 Borrowings to the accompanying condensed consolidated financial statements for more information. There have been no other material changes to the Company’s critical accounting estimates as compared to the estimates described in the Annual Report on Form 10-K as of December 31, 2024 which we believe are the most critical to our business and understanding of our results of operations and affect the more significant judgments and estimates that we use in preparation of our condensed consolidated financial statements. Other than the fair value evaluation mentioned above, there have been no other material changes to the Company’s critical accounting estimates since the Annual Report on Form 10-K as of December 31, 2024.

Current wording

A critical accounting estimate is one that is both important to the portrayal of a company’s financial condition and results of operations and requires management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. During the nine months ended September 30, 2025, the Company entered into a securities purchase agreement providing for the issuance of a convertible note and incremental warrants which required a fair value evaluation under ASC 825. This evaluation constituted an additional critical accounting estimate to the Company. SeeNote 4 Fair Value Measurements and Other LiabilitiesandNote 5 Borrowings to the accompanying condensed consolidated financial statements for more information. There have been no other material changes to the Company’s critical accounting estimates as compared to the estimates described in the Annual Report on Form 10-K as of December 31, 2024 which we believe are the most critical to our business and understanding of our results of operations and affect the more significant judgments and estimates that we use in preparation of our condensed consolidated financial statements. Other than the fair value evaluation mentioned above, there have been no other material changes to the Company’s critical accounting estimates since the Annual Report on Form 10-K as of December 31, 2024.

Previous wording

Franchising services revenue decreased by approximately $38 thousand, or 55%, in the three-months ended June 30, 2025 as compared to the three-months ended June 30, 2024. The decrease is attributable to the acquisition of franchises in fiscal year 2024, which no longer contribute to franchising royalties fees. Our remaining franchisees did not see a significant changes in transaction revenues between periods.

Current wording

Franchising services revenue decreased by approximately $38 thousand, or 57%, in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. The decrease is attributable to the acquisition of franchises in fiscal year 2024, which no longer contribute to franchising royalties fees. Our remaining franchisees did not see a significant changes in transaction revenues between periods.

Previous wording

Coaching services revenue decreased by approximately $126 thousand, or 37%, in the six-months ended June 30, 2025 as compared to the six-months ended June 30, 2024, primarily due to a strategic shift to allow large teams to onboard without coaching in an effort to increase onboarding at the expense of Coaching.

Current wording

Coaching services revenue increased by approximately $28 thousand, or 22%, in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024, primarily due to increases in agent counts offset by a strategic shift to allow large teams to onboard without coaching in an effort to increase onboarding which reduced coaching revenues.

Previous wording

Property management revenue increased by approximately $326 thousand, or 11%, in the three-months ended June 30, 2025 as compared to the three-months ended June 30, 2024, primarily due to an increase in the number of properties under management.

Current wording

Property management revenue increased by approximately $255 thousand, or 9%, in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024, primarily due to an increase in the number of properties under management.

Previous wording

Residential real estate services sales revenue increased by approximately $3.9 million, or 24%, in the three-months ended June 30, 2025 as compared to the three-months ended June 30, 2024. The increase was driven primarily by approximately $3.0 million of revenue from the four acquisitions completed in the 3 rd and 4 th quarter of fiscal year 2024 along with incremental additional revenue from the five acquisitions completed in the 1 st and 2 nd quarter of fiscal year 2024.

Current wording

Residential real estate services sales revenue increased by approximately $8.2 million, or 19%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The increase was driven primarily by acquisitions completed in the 4 th quarter of fiscal year 2024 along with incremental additional revenue from the acquisitions in the first three quarters of fiscal year 2024.

Previous wording

Franchising services revenue decreased by approximately $143 thousand, or 67%, in the six-months ended June 30, 2025 as compared to the six-months ended June 30, 2024. The decrease is attributable to the acquisitions completed in fiscal year 2024 that were franchisees, which no longer contribute to franchising royalties fees. Our remaining franchisees did not see a significant changes in transaction revenues between the per.

Current wording

Franchising services revenue decreased by approximately $181 thousand, or 65%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The decrease is attributable to the acquisitions completed in fiscal year 2024 that were franchisees, which no longer contribute to franchising royalties fees. Our remaining franchisees did not see a significant changes in transaction revenues between the per.

Previous wording

Coaching services revenue decreased by approximately $88 thousand, or 42%, in the three-months ended June 30, 2025 as compared to the three-months ended June 30, 2024, primarily due to a strategic shift to allow large teams to onboard without coaching in an effort to increase onboarding at the expense of Coaching.

Current wording

Coaching services revenue decreased by approximately $99 thousand, or 21%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024, primarily due to a strategic shift to allow large teams to onboard without coaching in an effort to increase onboarding at the expense of Coaching.

Previous wording

Property management revenue increased by approximately $758 thousand, or 14%, in the six-months ended June 30, 2025 as compared to the six-months ended June 30, 2024, primarily due to an increase in the number of properties under management.

Current wording

Property management revenue increased by approximately $1.01 million, or 12%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024, primarily due to an increase in the number of properties under management.

Previous wording

Costs of revenue related to coaching services decreased by approximately $29 thousand, or 26%, in the three-months ended June 30, 2025 as compared to the three-months ended June 30, 2024. Costs related to coaching services is related to the augmentation of the coaching program to expedite agent onboarding. The gross profit of coaching services has decreased by $60 thousand, or about 60%, for the three-month period ending June 30, 2025 over the comparable prior year period due to a shift in priority to growth in onboarding without a coaching requirement.

Current wording

Gross margin decreased by approximately $6 thousand, or 12%, in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. Costs related to coaching services is related to the augmentation of the coaching program to expedite agent onboarding due to a shift in priority to growth in onboarding without a coaching requirement.

Previous wording

Costs of revenue related to property management services increased by approximately $353 thousand, or 13%, in the three-months ended June 30, 2025 as compared to the three-months ended June 30, 2024. The increase in property management costs was primarily related to an increase in properties under management. The gross profit of property management services has declined by $26 thousand, or about 21%, for the three-month period ending June 30, 2025 over the comparable prior year period related to payroll increase in properties under management.

Current wording

Gross margin related to property management services increased by approximately $2 thousand, or 2%, in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. The increase in property management revenues and costs was primarily related to an increase in properties under management.

Previous wording

Costs related to residential real estate brokerage services increased by approximately $7.3 million, or 31%, in the six-months ended June 30, 2025 as compared to the six-months ended June 30, 2024. The increase was driven by approximately $4.7 million of cost of revenue from the four acquisitions completed in the 3 rd and 4 th of fiscal year 2023 and the five acquisitions completed in the 1 st and 2 nd quarter of fiscal year 2024. The gross profit increased by approximately $634 thousand, or 26%, for the six-months ended June 30, 2025 as compared to the six-months ended June 30, 2024 primarily attributable to the gross profit from acquisitions.

Current wording

Gross margin related to residential real estate brokerage services increased by approximately $0.7 million, or 17%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The increase was driven by approximately $7.5 million of cost of revenue primarily from the four acquisitions completed in the fourth quarter of fiscal year 2023 and the six acquisitions completed in the first three quarters of fiscal year 2024.

Previous wording

Costs of revenue related to coaching services decreased by approximately $46 thousand, or 25%, in the six-months ended June 30, 2025 as compared to the six-months ended June 30, 2024. Costs related to coaching services is related to the augmentation of the coaching program. The gross profit of coaching services has decreased by $81 thousand, or about 51%, for the six-month period ending June 30, 2025 over the comparable prior year period due to a shift in priority to growth in onboarding without a coaching requirement.

Current wording

Gross margin decreased by approximately $87 thousand, or 41%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. Costs related to coaching services is related to the augmentation of the coaching program to expedite agent onboarding due to a shift in priority to growth in onboarding without a coaching requirement.

Previous wording

Costs of revenue related to property management services increased by approximately $717 thousand, or 14%, in the six-months ended June 30, 2025 as compared to the six-months ended June 30, 2024. The increase in property management costs was primarily related to an increase in properties under management. The gross profit of property management services has increased by $41 thousand, or about 26%, for the six-month period ending June 30, 2025 over the comparable prior year period related to increase in properties under management.

Current wording

Gross margin related to property management services increased by approximately $44 thousand, or 17%, in the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. The increase in property management revenues and costs was primarily related to an increase in properties under management.

Previous wording

We acquired Nona Title rebranded FPG Title near the end of the third quarter of 2024, increases are related to this acquisition generating revenues, cost of revenues and general and administrative expenses for the first time for the six-months ended June 30, 2025.

Current wording

We acquired Nona Title rebranded FPG Title near the end of the third quarter of 2024, increases are related to this acquisition generating revenues, cost of revenues and general and administrative expenses for the first time for the nine months ended September 30, 2025.

Previous wording

Selling, general and administrative costs increased by approximately $855 thousand, or 29%, in the three-months ended June 30, 2025 as compared to the three-months ended June 30, 2024. Of this $248 thousand is related to professional service, and $508 thousand is related to payroll and benefits which were added to support the acquisitions, administrative, sales and marketing activities in addition public company cost decreased by $391 thousand related to decreases in acquisitions between years.

Current wording

Selling, general and administrative costs increased by approximately $1.38 million, or 46%, in the three months ended September 30, 2025 as compared to the three months ended September 30, 2024. Of this $375 thousand is related to professional service, and $690 thousand is related to payroll and benefits which were added to support the acquisitions, administrative, sales and marketing activities in addition public company cost increased by $165 thousand related to financing activities and other compliance matters.

Previous wording

Selling, general and administrative costs increased by approximately $2.6 million, or 47%, in the six-months ended June 30, 2025 as compared to the six-months ended June 30, 2024. Of this $941 thousand is related to professional service, and $1.1 million is related to payroll and benefits which were added to support the acquisitions, administrative, sales and marketing activities.

Current wording

Selling, general and administrative costs increased by approximately $4.0 million, or 47%, in the nine months September 30, 2025 as compared to the nine months ended September 30, 2024. Of this $1.3 million is related to professional service, and $1.8 million is related to payroll and benefits which were added to support the acquisitions, administrative, sales and marketing activities.

Previous wording

We incurred stock-based compensation of approximately $507,000 and $2,422,000 in the three and six months ended June 30, 2025, respectively. Year to date primarily due to option and other grants to our CEO pursuant to the terms of his employment agreement ($1.6 million) and consultant shares granted for various advisory and marketing functions ($58 thousand) and other grants to our agents and employees in the form of restricted stock units.

Current wording

We incurred stock-based compensation of approximately $2.3 million and $4.8 million in the three and nine months ended September 30, 2025, respectively, primarily due to option and other grants to our CEO pursuant to the terms of his employment agreement ($2.2 million) and consultant shares granted for various advisory and marketing functions ($1.5 million) and other grants to our agents and employees in the form of restricted stock units.

Previous wording

We incurred stock-based compensation of approximately $474 thousand and $3.7 million in the three and six months ended June 30, 2024, respectively. Yeat to date being primarily due to option grants to our CEO pursuant to the terms of his employment agreement ($2.1 million), other employees ($0.9 million), and consultants who provided various services to the company ($0.7 million).

Current wording

We incurred stock-based compensation of approximately $390 thousand and $4.1 million in the three and nine months ended September 30, 2024, respectively, due to option grants to our CEO pursuant to the terms of his employment agreement $2.1 million), other employees ($1.0 million), and investors and consultants who provided various services to the company ($1.0 million).

Previous wording

Other income (expense), net for the three-months ended June 30, 2025, increased approximately $81 million compared to other income (expense), net, for the three-months ended June 30, 2024. The increase in expense in 2025 was primarily due to the gain on settlement of the Incremental Warrants for $82.3 million, gain on extinguishment of debt for $4.1 million, offset by a loss of $5.3 million on the change in fair value of convertible note and warrants.

Current wording

Other income (expense), net for the three months ended September 30, 2025, decreased approximately $91 thousand compared to other income (expense), net, for the three months ended September 30, 2024. The decrease in expense in 2025 was primarily due the 2024 loss of $722 thousand offset by the 2024 fair value adjustments for derivatives and warrants.

Previous wording

Other expense, net for the six-months ended June 30, 2025, increased approximately $9.6 million compared to other expense, net, for the six-months ended June 30, 2024. The increase in expense in 2025 was primarily due to the loss on issuance of senior secured convertible note for $128.8 million, offset by gain on extinguishment of incremental warrants $82.3 million, gain of $31.8 million on the change in fair value of convertible note and warrants and a $4 million gain on extinguishment of debt.

Current wording

Other expense, net for the nine months ended September 30, 2025, increased approximately $9.5 million compared to other expense, net, for the nine months ended September 30, 2024. The increase in expense in 2025 was primarily due to the loss on issuance of senior secured convertible note for $128.8 million, offset by gain on extinguishment of incremental warrants $82.3 million, gain of $31.8 million on the change in fair value of convertible note and warrants and a $4.6 million gain on extinguishment of debt.

Previous wording

On June 30, 2025, the Company had a cash balance of $7.1 million and working capital of $4.4 million.

Current wording

On September 30, 2025, the Company had a cash balance of $4.0 million and working capital of $1.2 million.

Previous wording

In addition to the debt pay downs during the six months ended June 30, 2025, the Company eliminated all warrants tied to the investor senior secured promissory notes outstanding as of December 31,2024. Two of the three warrants were exercised on a cashless basis, with the third warrant being bought back by the Company in the amount of $379,083, fully eliminating these unfavorable ratchet warrants.

Current wording

In addition to the debt pay downs during the nine months ended September 30, 2025, the Company eliminated all warrants tied to the investor senior secured promissory notes outstanding as of December 31,2024. Two of the three warrants were exercised on a cashless basis, with the third warrant being bought back by the Company in the amount of $379,083, fully eliminating these unfavorable ratchet warrants.

Previous wording

During the six-months ended June 30, 2025, operating activities consumed $4.8 million of our cash on hand, which was primarily attributable to the net loss of $4.0 million, excluding stock-based compensation, gains and losses on issuance of senior secured convertible notes and warrants, fair market value adjustments, amortization, depreciation and other changes, changes in operating assets and liabilities consumed a further $859 thousand, mostly due to an increase in accounts receivable and an decrease in operating lease liabilities.

Current wording

During the nine months ended September 30, 2025, operating activities consumed $6.2 million of our cash on hand, which was primarily attributable to the net loss of $6.6 million, excluding stock-based compensation, gains and losses on issuance of senior secured convertible notes and warrants, fair market value adjustments, amortization, depreciation and other changes, changes in operating assets and liabilities provided $382 thousand, mostly due to an increase in accounts payable and accrued expenses and an decrease in operating lease liabilities.

Previous wording

During the six months ended June 30, 2024, operating activities consumed $1.3 million of our cash on hand, which was primarily attributable to the net loss of $2.0 million, excluding stock-based compensation, amortization and depreciation, non-cash interest expense and amortization of debt discounts, and provision for credit losses, partially offset by changes in working capital of $0.7 million, mostly due to an increase in accounts payable, security deposit payables, and an increase in contract liabilities, partially offset by an increase in accounts receivable and payments on lease liabilities.

Current wording

During the nine months ended September 30, 2024, operating activities consumed $1.9 million of our cash on hand, which was primarily attributable to the net loss of $9.3 million, excluding stock-based compensation, amortization and depreciation, non-cash interest expense and amortization of debt discounts and provision for credit losses, partially offset by changes in working capital of $1.2 million, mostly due to an increase in accounts payable, accrued expenses, security deposit payables, partially offset by an increase in payments on lease liabilities.

Previous wording

During the six-months ended June 30, 2025 there were no activities that consumed cash for the quarter.

Current wording

During the nine months ended September 30, 2025 there were no activities that consumed cash.

Previous wording

During the six months ended June 30, 2024, we purchased five acquisitions with capital stock and two of the five with additional cash payments totaling $60 thousand. Each of the five acquisitions had an aggregate amount of $132 thousand of cash.

Current wording

During the nine months ended September 30, 2024, we completed seven acquisitions with capital stock and three of the seven with additional cash payments totaling $240 thousand. Each of the seven acquisitions had an aggregate amount of $265 thousand of cash.

Previous wording

During the six-months ended June 30, 2025, we received net cash provided by financing activities of $8.4 million, which included net proceeds from our S-3 of $6.7 million and from our debt issuance in February 2025 of $3.4 million, offset by $1.7 million in payments to notes payable, post-acquisition consideration, and advances on future receipts.

Current wording

During the nine months ended September 30, 2025, we received net cash provided by financing activities of $9.1 million, which included net proceeds from our S-3 of $7.5 million and from our debt issuance in February 2025 of $3.4 million, offset by $1.8 million in payments to notes payable, post-acquisition consideration, and advances on future receipts.