Material Definitive Agreement - Form 8-K

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): January 18, 2022

LANDSEA HOMES CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	001-38545	82-2196021
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

660 Newport Center Drive, Suite 300
Newport Beach, California		92660
(Address of principal executive offices)		(Zip Code)

Registrant's telephone number, including area code: (949)345-8080

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, par value $0.0001 per share		LSEA		The NasdaqCapital Market
Warrants exercisable for Common Stock		LSEAW		The NasdaqCapital Market

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.

On January 18, 2022, Landsea Homes Corporation, a Delaware corporation (the "Company"), and its wholly owned subsidiary, Landsea Homes of Florida LLC, a Delaware corporation ("Buyer"), entered into a Membership Interest Purchase Agreement (the "Purchase Agreement") with SAM Building Partners, LLC and Edge Creek Ventures, LLC, as the sellers (each a "Seller" and, collectively, the "Sellers"), and SWO Holdings Irrevocable Trust dated April 3, 2017, AJO Holdings Irrevocable Trust dated April 3, 2017, JMO Holdings Irrevocable Trust dated April 3, 2017, Stephen W. Orosz, Andrew J. Orosz, and J. Matthew Orosz, pursuant to which Buyer acquired (the "Acquisition") all the membership interests of Hanover Family Builders, LLC, a Florida-based homebuilder ("HFB"), which Acquisition closed concurrently with the execution of the Purchase Agreement. Buyer acquired all of the outstanding equity interests of HFB for an aggregate cash purchase price of $179.2 million, subject to certain post-closing adjustments with respect to transaction expenses and working capital, in each case, as further described in the Purchase Agreement. The Purchase Agreement contains customary representations, warranties and covenants of the parties, and indemnification provisions with respect to various breaches and other matters as further described in the Purchase Agreement.

Neither the Company nor any of its affiliates (including Buyer), nor any director or officer of the Company or any of its affiliates (including Buyer), nor any associate of any such director or officer, has any material relationship with the Sellers or their affiliates.

Concurrently with the closing of the Acquisition, the Company repaid all $69.3 million in principal of HFB's outstanding indebtedness. The Company funded the Acquisition, including the repayment of HFB's indebtedness from a combination of cash on hand and borrowings under the Company's existing revolving credit facility.

Concurrently with the consummation of the Acquisition, the Company and Buyer entered into an agreement with Hanover Land Company, LLC ("HLC"), an entity owned by affiliates of the Sellers, and certain of its affiliates (the "Hanover Agreement"). Pursuant to the Hanover Agreement, the Company, through Buyer, agreed to purchase certain land positions from HLC and its affiliates and enter into purchase agreements to acquire additional lots in the future. The Hanover Agreement also grants the Company a right of first refusal with respect to single family residential land acquisitions and projects sold by HLC or its affiliates for two years after the closing of the Acquisition.

The foregoing description of the Purchase Agreement and the Hanover Agreement are not complete and are qualified in their entirety by reference to the full text of such agreements, which are attached as Exhibit 10.1 and Exhibit 10.2, respectively to this Current Report on Form 8-K and incorporated herein by reference. The representations, warranties and covenants contained in the Purchase Agreement were made only for the purposes of such agreement and as of specific dates, were made solely for the benefit of the parties to the Purchase Agreement and may be intended not as statements of fact, but rather as a way of allocating risk to one of the parties if those statements prove to be inaccurate.

Item 2.01

Completion of Acquisition or Disposition of Assets.

The information set forth in Item 1.01 relating to the Acquisition is incorporated herein by reference.

Item 9.01

Financial Statements and Exhibits.

(a) Financial Statements of Business Acquired:

The financial statements required by Item 9.01(a) of Form 8-K will be filed by amendment within 71 calendar days from which this Current Report on Form 8-K must be filed.

(b) Pro Forma Financial Information:

The pro forma financial information required by Item 9.01(b) of Form 8-K will be filed by amendment within 71 calendar days from which this Current Report on Form 8-K must be filed.

(d) Exhibits

Exhibit No.	Description
10.1	Membership Interest Purchase Agreement, dated January 18, 2022, by and among Landsea Homes Corporation, Landsea Homes of Florida LLC, SAM Building Partners, LLC and Edge Creek Ventures, LLC, as the sellers, and SWO Holdings Irrevocable Trust dated April 3, 2017, AJO Holdings Irrevocable Trust dated April 3, 2017, JMO Holdings Irrevocable Trust dated April 3, 2017, Stephen W. Orosz, Andrew J. Orosz, and J. Matthew Orosz.*
10.2	Hanover Agreement, dated January 18, 2022, by and among Landsea Homes Corporation, Landsea Homes of Florida LLC, Hanover Land Company, LLC and the other seller parties thereto.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

* Certain schedules and exhibits to this agreement have been omitted pursuant to Item 601(b)(10) of Regulation S-K and the Company agrees to furnish supplementally to the Securities and Exchange Commission a copy of any omitted schedule and/or exhibit upon request.

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.

		LANDSEA HOMES CORPORATION
Date: January 20, 2022	By:	/s/ Franco Tenerelli
		Name: Franco Tenerelli
		Title: Executive Vice President, Chief Legal Officer and Secretary

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