October 20, 2023
October 20, 2023 ☐ The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission acting pursuant to said section 8(a), may determine.November 23, 2021333- 333-274489Form 5500
incorporation or organization)
Classification Code Number)
Identification Number)William P. MurnaneChairman and 6130 Lazy Days BoulevardSeffner,3358433610
including area code, of agent for service)Please send a copy of all communications to:Robert J. Grammig:M. MillsKristin L. PadgettZupponeHolland & Knight100 North Tampa StreetSuite 4100Tampa, Florida 33602Telephone: (813) 227-8500public: From time to timepublic: As soon as practicable after the effective date of this registration statement becomes effective.Registration Statement.☒Formform is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐Formform is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐Formform is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐ a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company”company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. ActAct. ☐CALCULATION OF REGISTRATION FEETitle of each class of securities to be registered Amount to be registered(1) Proposed maximum offering price per share Proposed maximum aggregate offering price Amount of registration fee Shares of Common Stock, par value $0.0001 per share 1,712,912 $ 20.83 (2) $ 35,679,957 $ 3,307.53 Shares of Series A Preferred Stock, par value $0.0001 per share 600,000 $ 100.00 (3) $ 60,000,000 $ 5,562 PIPE Warrants, each to purchase one share of Common Stock 1,280,915 $ 4.74 (4) $ 6,071,537.10 $ ⸺ (5) Pre-funded Warrants, each to purchase one share of Common Stock 300,357 $ 8.74 (4) $ 2,625,120.18 $ ⸺ (5) Public Warrants, each to purchase 1/2 share of Common Stock 54,500 $ 4.74 (4) $ 258,330 $ ⸺ (5) Shares of Common Stock, par value $0.0001 per share, underlying outstanding Series A Preferred Stock 5,962,733 (6) $ 10.0625 (7) $ 60,000,000.80 $ 5,562 Shares of Common Stock, par value $0.0001 per share, underlying outstanding PIPE Warrants (each to purchase one share of Common Stock) 1,280,915 $ 16.24 (8) $ 20,802,059.60 $ 1,928.35 Shares of Common Stock, par value $0.0001 per share, underlying outstanding Pre-funded Warrants (each to purchase one share of Common Stock) 300,357 $ 8.75 (8) $ 2,628,123.75 $ 243.63 Shares of Common Stock, par value $0.0001 per share, underlying outstanding Public Warrants (each to purchase ½ share of Common Stock) 27,250 $ 16.24 (8) 442,540 $ 41.02 Total $ 188,507,668 $ 16,644.53 (1)In the event of a stock split, reverse stock split, stock dividend or similar transaction involving our common stock, the number of shares registered shall automatically be adjusted to cover the additional shares of common stock issuable pursuant to Rule 416 under the Securities Act of 1933, as amended.(2)Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(c) of the Securities Act, based upon the average of the high and low sales prices of the Registrant’s common stock as reported on the Nasdaq Capital Market on November 18, 2021.(3)Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(i) of the Securities Act based on the original issue price of the Series A Preferred Stock.(4)Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(c) and 457(i) of the Securities Act, based upon the average of the high and low sales prices of the Registrant’s warrants as quoted on the OTC Pink marketplace on November 17, 2021 ($4.74) and based upon the original issue price for the pre-funded warrants ($8.74).(5)No separate fee due in accordance with Rule 457(i) and Compliance and Disclosure Interpretations, Securities Act Rules, Question 240.06. The applicable registration fee has been allocated to the common stock underlying the PIPE Warrants, Pre-funded Warrants and Public Warrants.(6)5,962,733 shares of common stock are issuable upon conversion of the Series A Preferred Stock based on the 600,000 shares of Series A Preferred Stock outstanding multiplied by the conversion rate of 9.9378882 (calculated by dividing the liquidation preference of $100 by the conversion price of $10.0625 as set forth in the Certificate of Designation governing the Series A Preferred Stock).(7)Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(i) based upon the conversion price of the Series A Preferred Stock of $10.0625.(8)In accordance with Rule 457(i) and Compliance and Disclosure Interpretations, Securities Act Rules, Question 240.06, the proposed maximum offering price of the shares of Common Stock underlying the warrants is the sum of the offering price of such warrants as estimated (see footnote 4 ), or $4.74 per share, and the exercise price of such warrants, or $11.50 per share, for a total of $16.24 per share, and for the pre-funded warrants the proposed maximum offering price of the shares of Common Stock underlying the pre-funded warrants is the sum of the offering price of such warrants as estimated (see footnote 4), or $8.74 per share, and the exercise price of the such warrants, or $0.01 per share, for a total of $8.75 per share.
The information in this prospectus is not complete and may be changed. The selling securityholdersWe may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any statejurisdiction where the offer or sale is not permitted.
PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED NOVEMBER 23, 2021.
PROSPECTUS
1,712,912 sharesSubject to completion, dated October 20, 2023
Lazydays Holdings, Inc.
This prospectus relatesunsubscribed shares at the subscription price, subject to 1,712,912 sharesthe availability and pro rata allocation of Common Stock 600,000 shares of Series A Convertible Preferred Stock which we refer to asamong persons exercising this Over-Subscription Right. See “Questions & Answers — What are the “Series A Preferred Stock,” 1,635,772 warrants to purchase shares of common stock, 5,962,733 shares of common stock issuable upon conversionlimitations of the Series A PreferredOver-Subscription Right?”
We will not receive any proceeds from the sale of the securities under this prospectus, although we could receive up to $39,322,769 upon the exercise of all of the warrants. Any amounts we receive from such exercises will be used for working capital and other general corporate purposes.
Information regarding the Selling Securityholders the amounts of shares of common stock, Series A Preferredyour Rights.
The Selling Securityholders and intermediaries through whom such securities are sold may be deemed “underwriters” within the meaning of the Securities Act of 1933, as amended (the “Securities Act”), with respect to the securities offered hereby, and any profits realized or commissions received may be deemed underwriting compensation. We have agreed to indemnify the Selling Securityholders against certain liabilities, including liabilities under the Securities Act.
Our common stock is listed on the Nasdaq Capital Market tier of The Nasdaq Stock Market LLC (“Nasdaq”) under the symbol “LAZY” and our warrants are quoted on the OTC Pink marketplace under the symbol “LAZYW”.“LAZY.” On November 22, 2021,October 19, 2023, the last reported sale pricesprice of our commonCommon Stock was $8.22. The Rights are non-transferrable, except that Rights will be transferable by operation of law (e.g., by death) or by such Holders that are closed-end funds to funds affiliated with such Holders. The Rights will not be listed for trading on Nasdaq or any other stock and warrants were $20.44 per share and $4.50 per warrant, respectively. Our Series A Preferred Stock is not currently listed or quoted on any exchange or marketplacemarket. You are urged to obtain a current price quote for our Common Stock before exercising your Rights.
Investingrecord holder of your securities, we recommend that you submit your subscription documents to the Subscription Agent well before the deadline. If you want to participate in ourthis Rights Offering and you hold securities involvesthrough your broker, dealer, bank, or other nominee, you should promptly contact your broker, dealer, bank, or other nominee and submit your subscription documents in accordance with the instructions and within the time period provided by your broker, dealer, bank, or other nominee. For a high degree of risk. See the section titled “Risk Factors,” which beginsmore detailed discussion, see “The Rights Offering — The Rights” beginning on page 4.
28.
| | Per Share | | | Total(1) | |
Subscription Price | | | $6.399 | | | $100,000,000 |
Proceeds to us, before expenses | | | $6.399 | | | $100,000,000 |
(1) | Assumes the Rights Offering is fully subscribed. |
Q: | What is the Rights Offering? |
Q: | Why are we conducting the Rights Offering? |
Q: | What is a Right? |
Q: | How was the subscription price of $6.399 per share of Common Stock determined? |
Q: | What is the Basic Subscription Right? |
Q: | What is the Over-Subscription Right? |
Q: | What are the limitations of the Over-Subscription Right? |
Q: | Will fractional shares be issued upon exercise of the Rights? |
Q: | Has our Board, the Special Committee or the Company made a recommendation to our stockholders whether to exercise or let lapse their Rights in the Rights Offering? |
Q: | Will the directors and executive officers participate in this Rights Offering? |
Q: | How do I exercise my Rights? |
Q: | What should I do if I want to participate in the Rights Offering, but my shares are held in the name of my broker, dealer, or other nominee? |
Q: | Will I be charged a sales commission or a fee if I exercise my Rights? |
Q: | Are there any conditions to my right to exercise my Rights? |
Q: | May I participate in this Rights Offering if I sell my Common Stock after the Record Date? |
Q: | How soon must I act to exercise my Rights? |
Q: | When will I receive my Rights Certificate? |
TABLE OF CONTENTS
About this Prospectus
This prospectus is partNew York City time, on the Record Date, based on our securities registry maintained at the transfer agent for our Common Stock and by our treasury department for the Warrants and Series A Preferred Stock. If you hold your shares of Common Stock through a registration statement on Form S-1 that we filed with the Securities and Exchange Commission (the “SEC”) using a “shelf” registration process. Under this shelf registration process, the Selling Securityholders and their permitted transferees may, from time to time, offer and sell,brokerage account, bank or other nominee, you will not receive an actual Rights Certificate. Instead, as applicable, any combination of the securities described in this prospectus, you must instruct your broker, bank or nominee whether or not to exercise Rights on your behalf. If you wish to obtain a separate Rights Certificate, you should promptly contact your broker, bank or other nominee and request a separate Rights Certificate.
Q: | May I sell, transfer or assign my Rights? |
Q: | Will I be able to trade my Rights on the Nasdaq? |
Q: | Am I required to subscribe in the Rights Offering? |
Q: | Am I required to exercise any or all of the Rights I receive in the Rights Offering? |
Q: | Is the Company requiring a minimum subscription to complete the Rights Offering? |
Q: | Can the Special Committee cancel, terminate, amend or extend the Rights Offering? |
Q: | Will my percentage ownership interest in the Company be diluted by the Rights Offering? |
Q: | If I exercise Rights in the Rights Offering, may I cancel or change my decision? |
Q: | How much money will the Company receive from the Rights Offering? |
Q: | Are there risks in exercising my Rights? |
should be considered as carefully as you would consider any other equity investment. We use market and industry data throughouturge you to carefully read the section titled “Risk Factors” beginning on page 17 of this prospectus particularly inand the section entitled “Prospectus Summary.” The markettitled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2022 and industry data are basedin our Quarterly Reports on Form 10-Q for the good faith estimates of our management, research studiesquarterly periods ended March 31, 2023 and surveys, independent industry publicationsJune 30, 2023, and all other publicly available information. Industry publications and research studies and surveys generally state that they have been obtained from sources believed to be reliable, although they do not guarantee the accuracyinformation included or completeness of such information. These data involve a number of assumptions and limitations, and investors are cautioned not to give undue weight to such estimates. Although we have not independently verified the accuracy or completeness of any third-party information, we believe that the information from these publications and studies includedincorporated by reference in this prospectus in its entirety before you decide whether to exercise your Rights.
Q: | How many shares of Common Stock will be outstanding immediately after the Rights Offering? |
Q. | Is the Rights Offering similar to a forward stock split? |
Q. | Is the Rights Offering similar to a reverse stock split? |
Q: | Will this Rights Offering result in the Company “going private” for purposes of Rule 13e-3 of the Exchange Act? |
Q: | If the Rights Offering is not completed, will my subscription payment be refunded to me? |
Q: | What should I do if I want to participate in the Rights Offering, but I am a stockholder with a foreign address? |
Q: | What are the U.S. federal income tax considerations applicable to holders of receiving or exercising Rights? |
Q: | To whom should I send my forms and payment? |
By Mail: | | | By Overnight Delivery: |
Broadridge Corporate Issuer Solutions, LLC Attn: BCIS Re-Organization Dept. P.O. Box 1317 Brentwood, NY 11717-0718 | | | Broadridge Corporate Issuer Solutions, LLC Attn: BCIS IWS 51 Mercedes Way Edgewood, NY 11717 |
Q: | What should I do if I have other questions? |
this prospectus. This summary is not complete and does not contain all of the information that is importantyou should consider before deciding whether to you. You shouldinvest in our Common Stock. For a more complete understanding of the Company and this Rights Offering, we encourage you to read and consider the entiremore detailed information included or incorporated by reference in this prospectus, including the Risk Factors, before making an investment decision.
risk factors, see “Risk Factors” beginning on page 17, and our most recent consolidated financial statements and related notes.
The Company operates Recreational Vehicle (“RV”)
The Company believes, basedcampground facilities at our Tampa, Florida location.
The Company attracts
Our principal executive offices are located at 6130 Lazy Days4042 Park Oaks Boulevard, Seffner,Suite 350, Tampa, Florida 3358433610 and our telephone number is (813) 246-4999. Our Internet website is www.lazydays.com. Our reports filed or furnished pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are available, free of charge, under the Investor Relations – Finance Information tab of our website as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC. The SEC also maintains an Internet website located at www.sec.gov that contains the information we file or furnish electronically with the SEC.
The information on our website is not incorporated by reference in this prospectus, and you should not consider it a part of this prospectus.
On October
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(1) Includes an aggregate of 5,962,733 shares of common stock issuable upon conversionThe Series A Preferred Stock and the Warrants may be subject to anti-dilution adjustments in connection with certain events, including the Rights Offering. The holders of the Series A Preferred Stock and 1,608,522have fully waived these anti-dilution adjustments in connection with the Rights Offering. The holders of the Warrants have partially waived these anti-dilution adjustments agreeing to accept an adjustment that increases number of shares issuable upon exercise equal to one-half of the number of shares of common stock issuableour Common Stock that would result from the adjustment in the absence of the waiver. These holders have also agreed to exercise all of the Warrants (giving effect to the foregoing one-half adjustment) held by them upon consummation of the Rights Offering. Holders of the Warrants represent 100% of all Warrant holders. Consequently, once the Rights Offering is completed, there will be no outstanding Warrants. For illustrative purposes, if the Rights in this Rights Offering are fully exercised, we anticipate an adjustment to the exercise price of the Warrants resulting in the issuance of 467,761 additional shares of Common Stock upon exercise, in accordance with the anti-dilution provision. Therefore, if the Rights in this Rights Offering are fully exercised, the expected total number of shares of Common Stock to be issued upon the exercise of warrants,the Warrants, after accounting for the foregoing anti-dilution adjustment, will be 30,114,585 shares of Common Stock. The holders of the Warrants have agreed to exercise all the Warrants held by them upon consummation of the Rights Offering.
• | Our acquisition on February 15, 2023 of Hohl-Findlay, LLC (“Findlay”); |
• | Our acquisition on July 24, 2023 of Buddy Gregg Motor Homes, LLC (“Buddy Gregg”); |
• | Our acquisition on August 7, 2023 of Century RV, Inc. (“Century”); |
• | Two planned acquisitions. |
| | Lazydays Holdings, Inc.(1) | | | Completed(2) | | | Planned Acquisitions(2) | | | Pro Forma Adjustments | | | | | Pro Forma Combined | |||||||||||
| | Findlay | | | Buddy Gregg | | | Century | | | Total | | |||||||||||||||
Revenues | | | | | | | | | | | | | | | | | | | |||||||||
New vehicle retail | | | 777,807 | | | 11,247 | | | 23,355 | | | 25,587 | | | 60,189 | | | 21,799 | | | — | | | | | 859,796 | |
Pre-owned vehicle retail | | | 394,582 | | | 6,082 | | | 8,828 | | | 6,519 | | | 21,429 | | | 8,564 | | | — | | | | | 424,574 | |
Vehicle wholesale | | | 21,266 | | | — | | | 8 | | | — | | | 8 | | | — | | | — | | | | | 21,274 | |
Finance and insurance | | | 75,482 | | | 716 | | | 2,059 | | | 2,809 | | | 5,584 | | | 907 | | | — | | | | | 81,973 | |
Service, body, parts and other | | | 57,824 | | | 2,036 | | | 3,990 | | | 1,583 | | | 7,609 | | | 4,376 | | | — | | | | | 69,809 | |
Total Revenue | | | 1,326,961 | | | 20,081 | | | 38,241 | | | 36,498 | | | 94,819 | | | 35,646 | | | — | | | | | 1,457,427 | |
| | | | | | | | | | | | | | | | | | ||||||||||
Cost applicable to revenues (excluding depreciation, and amortization as shown below) | | | | | | | | | | | | | | | | | | | |||||||||
New vehicle retail | | | 632,316 | | | 9,637 | | | 19,757 | | | 21,718 | | | 51,112 | | | 17,025 | | | — | | | | | 700,453 | |
Pre-owned vehicle retail | | | 301,565 | | | 4,987 | | | 6,725 | | | 4,699 | | | 16,410 | | | 6,221 | | | — | | | | | 324,196 | |
Vehicle wholesale | | | 21,620 | | | — | | | — | | | | | — | | | — | | | — | | | | | 21,620 | ||
Finance and insurance | | | 2,729 | | | — | | | — | | | — | | | — | | | — | | | — | | | | | 2,729 | |
Service, body, parts and other | | | 27,657 | | | 963 | | | 1,640 | | | 1,095 | | | 3,698 | | | 2,196 | | | — | | | | | 33,552 | |
LIFO | | | 12,383 | | | — | | | — | | | — | | | — | | | — | | | — | | | | | 12,383 | |
Total cost applicable to revenue | | | 998,270 | | | 15,587 | | | 28,122 | | | 27,512 | | | 71,220 | | | 25,442 | | | — | | | | | 1,094,932 | |
Gross profit | | | 328,691 | | | 4,494 | | | 10,119 | | | 8,986 | | | 23,599 | | | 10,205 | | | — | | | | | 362,495 | |
Depreciation and amortization | | | 16,758 | | | 18 | | | 150 | | | 47 | | | 215 | | | — | | | 375 | | | (3) | | | 17,348 |
Selling, general and administrative expenses | | | 222,218 | | | 4,029 | | | 6,105 | | | 5,973 | | | 16,107 | | | 7,071 | | | (1,936) | | | (4) | | | 243,460 |
Income from operations | | | 89,715 | | | 447 | | | 3,864 | | | 2,966 | | | 7,276 | | | 3,133 | | | 1,561 | | | | | 101,686 | |
Other income (expense) | | | | | | | | | | | | | | | | | | | |||||||||
Floorplan interest expense | | | (8,596) | | | (86) | | | (692) | | | (205) | | | (983) | | | (202) | | | (1,454) | | | (5) | | | (11,236) |
Other interest expense | | | (7,996) | | | 0 | | | (0) | | | (1) | | | (1) | | | (25) | | | (2,884) | | | (6) | | | (10,906) |
Interest income | | | — | | | — | | | — | | | — | | | — | | | 98 | | | — | | | | | 98 | |
Change in fair value of warrant liabilities | | | 12,453 | | | — | | | — | | | — | | | — | | | — | | | — | | | | | 12,453 | |
Total other (expense) income, net | | | (4,139) | | | (86) | | | (692) | | | (207) | | | (984) | | | (129) | | | (4,338) | | | | | (9,590) | |
Income before income tax expense | | | 85,576 | | | 361 | | | 3,172 | | | 2,759 | | | 6,292 | | | 3,004 | | | (2,777) | | | | | 92,096 | |
Income tax expense | | | (19,183) | | | (81) | | | (711) | | | (618) | | | (1,410) | | | (673) | | | 622 | | | (7) | | | (20,644) |
Net income | | | 66,393 | | | 280 | | | 2,461 | | | 2,141 | | | 4,882 | | | 2,331 | | | (2,154) | | | | | 71,451 | |
Dividends on Series A Convertible Preferred Stock | | | (4,801) | | | — | | | — | | | — | | | — | | | — | | | — | | | | | (4,801) | |
Net income and comprehensive income attributable to common stock and participating securities | | | 61,592 | | | 280 | | | 2,461 | | | 2,141 | | | 4,882 | | | 2,331 | | | (2,154) | | | | | 66,650 | |
EPS: | | | | | | | | | | | | | | | | | | | |||||||||
Basic | | | $3.47 | | | | | | | | | | | | | | | | | $3.76 | |||||||
Diluted | | | $2.42 | | | | | | | | | | | | | | | | | $2.68 | |||||||
| | | | | | | | | | | | | | | | | | ||||||||||
Weighted average shares outstanding | | | | | | | | | | | | | | | | | | | |||||||||
Basic | | | 11,701,302 | | | | | | | | | | | | | | | | | 11,701,302 | |||||||
Diluted | | | 12,797,796 | | | | | | | | | | | | | | | | | 12,797,796 |
(1) | Refers to the historical financial statements of Lazydays Holdings, Inc. appearing elsewhere in or incorporated into, this prospectus |
(2) | Refers to the historical financial results of the Transactions prior to the respective acquisitions. Note each of the completed and planned acquisitions is individually insignificant under S-X Rule 3-05. |
(3) | Adjustment to Depreciation and amortization of $375 thousand and $158 thousand for the year ended December 31, 2022 and six months ended June 30, 2023 represents the depreciation and amortization related to the step up in fair value of the acquired tangible and intangible assets. |
(4) | Adjustment to Selling, general and administrative expense of $(1,936) thousand and $(809) thousand for the year ended December 31, 2022 and six months ended June 30, 2023 represents the reversal of rent expense for those Transactions where the real property has been or is anticipated to be acquired as a part of the acquisition. In addition, rent expense for Century RV has been adjusted to reflect a lease agreement entered into as a part of the transaction. |
(5) | Adjustment to floor plan interest expense of $1,454 thousand and $2,693 thousand for the year ended December 31, 2022 and six months ended June 30, 2023 represents interest expense related to the $40 million decrease to our floor plan offset account. The adjustments are based upon variable interest rates. Our floor plan facility accrues interest at 30-day SOFR plus a margin ranging from 2% to 2.15% depending upon our leverage ratio. The adjustments have been calculated at 3.64% and 6.73%, respectively, using average SOFR throughout the period. The effect of 1/8 percent variance in the variable interest rates for the floor plan liability would change interest expense, net by approximately $50 thousand and $25 thousand for the year ended December 31, 2022 and six months ended June 30, 2023, respectively. |
(6) | Adjustment to other interest expense of $2,884 thousand and $1,232 thousand for the year ended December 31, 2022 and six months ended June 30, 2023 represents the interest expense for mortgages obtained or planned to be obtained on the acquired real property for the Buddy Gregg acquisition and both planned acquisitions as well as the mortgage obtained on our Murfreesboro location during July 2023. The adjustments are based on the fixed interests rates of 6.85% -7.1% on the mortgages obtained or estimated rates at the date the mortgage is expected to be obtained. |
(7) | Adjustment represents the income tax effect of the financial information of the Transactions and pro forma adjustments. For pro forma purposes, a blended federal and statutory rate of 22.4% and 26.2% for the year ended December 31, 2022 and six months ended June 30, 2023 has been assumed for pro forma adjustments. |
(1) | Refers to the historical financial statements of Lazydays Holdings, Inc. appearing elsewhere in or incorporated into, this prospectus |
(2) | Represents the preliminary purchase price allocation for the Buddy Gregg and Century RV acquisitions completed subsequent to June 30, 2023 and the two planned acquisitions not yet completed. The adjustments consider cash consideration for the acquisition, and preliminary estimated fair value of inventories acquired, ROU asset and lease liabilities obtained, real and tangible property acquired, goodwill and floor plan arrangements entered into at the time of acquisition to add the acquired inventory to the Company’s existing floor plan. For each immaterial acquisition, we did not acquire the historical working capital balances and thus no adjustments have been made to reflect the impact of such amounts. |
(3) | Represents the cash proceeds and corresponding increase to the Company’s existing floor plan facility for a decrease in the floorplan offset account of $40 million and increased floorplan borrowings obtained for acquired inventory and mortgage liabilities on the acquired real property to consummate the Transactions. |
(2) Does not include 5,962,733 sharespresentation provides useful information to investors regarding financial and business trends related to these completed acquisitions and that when non-GAAP financial information is viewed with GAAP financial information, investors are provided with a more meaningful understanding of common stock issuable upon the conversionongoing operating performance of these completed acquisitions.
| | Year ended December 31, 2022(1) | ||||||||||
| | Findlay | | | Buddy Gregg | | | Century | | | Total | |
Net income and comprehensive income attributable to common stock and participating securities | | | 280 | | | 2,461 | | | 2,141 | | | 4,882 |
Floor plan interest expense | | | 86 | | | 692 | | | 205 | | | 983 |
Other interest expense | | | — | | | — | | | 1 | | | 1 |
Income tax expense | | | 81 | | | 711 | | | 618 | | | 1,410 |
Depreciation and amortization | | | 18 | | | 150 | | | 47 | | | 215 |
EBITDA | | | 465 | | | 4,014 | | | 3,013 | | | 7,492 |
Floor plan interest | | | (86) | | | (692) | | | (205) | | | (983) |
Adjusted EBITDA | | | 379 | | | 3,322 | | | 2,807 | | | 6,509 |
(1) | Refers to the historical financial results prior to the respective acquisitions. Note each of the completed acquisitions is individually insignificant under S-X Rule 3-05. |
| | Lazydays Holdings, Inc.(1) | | | Completed Acquisitions(2) | | | Planned Acquisitions | | | Financing Activity(3) | | | Pro Forma Combined | |||||||
| | Buddy Gregg | | | Century RV | | | Total | | ||||||||||||
Assets | | | | | | | | | | | | | | | |||||||
Current assets | | ||||||||||||||||||||
Cash | | | 24,173 | | | (30,744) | | | (21,715) | | | (52,459) | | | (42,471) | | | 106,292 | | | 35,535 |
Receivables, net of allowance for doubtful accounts of $476 | | | $28,468 | | | — | | | — | | | — | | | — | | | — | | | 28,468 |
Inventories | | | 389,832 | | | 8,647 | | | 9,632 | | | 18,279 | | | 10,461 | | | | | 418,571 | |
Income tax receivable | | | 6,673 | | | — | | | — | | | — | | | — | | | — | | | 6,673 |
Prepaid expenses and other | | | 5,490 | | | — | | | — | | | — | | | — | | | — | | | 5,490 |
Total current assets | | | 454,636 | | | (22,097) | | | (12,083) | | | (34,180) | | | (32,010) | | | 106,292 | | | 494,738 |
Property and equipment, net of accumulated depreciation of $40,412 | | | $207,568 | | | 14,797 | | | 83 | | | 14,880 | | | 16,010 | | | — | | | 238,458 |
Operating lease right-of-use-assets | | | 24,836 | | | — | | | 5,500 | | | 5,500 | | | — | | | — | | | 30,336 |
Goodwill and intangibles, net | | | 167,127 | | | 7,300 | | | 12,000 | | | 19,300 | | | 16,000 | | | — | | | 202,427 |
Other assets | | | 3,159 | | | — | | | — | | | — | | | — | | | — | | | 3,159 |
Total assets | | | 857,326 | | | — | | | 5,500 | | | 5,500 | | | (0) | | | 106,292 | | | 969,118 |
| | | | | | | | | | | | | | ||||||||
Liabilities and Stockholders' Equity | | | | | | | | | | | | | | | |||||||
Current liabilities | | | | | | | | | | | | | | | |||||||
Accounts payable | | | 14,587 | | | — | | | — | | | — | | | — | | | — | | | 14,587 |
Accrued expenses and other current liabilities | | | 30,595 | | | — | | | — | | | — | | | — | | | — | | | 30,595 |
Dividends payable | | | 1,197 | | | — | | | — | | | — | | | — | | | — | | | 1,197 |
Income tax payable | | | 67 | | | — | | | — | | | — | | | — | | | — | | | 67 |
Floor plan notes payable, net of debt discount | | | 305,061 | | | — | | | — | | | — | | | — | | | 64,594 | | | 369,655 |
Financing liability, current portion | | | 2,301 | | | — | | | — | | | — | | | — | | | — | | | 2,301 |
Long-term debt, current portion | | | 400 | | | — | | | — | | | — | | | — | | | — | | | 400 |
Operating lease liability, current portion | | | 5,073 | | | — | | | 1,020 | | | 1,020 | | | — | | | — | | | 6,093 |
Total current liabilities | | | 359,281 | | | — | | | 1,020 | | | 1,020 | | | — | | | 64,594 | | | 424,895 |
| | | | | | | | | | | | | | ||||||||
Long-term liabilities | | | | | | | | | | | | | | | |||||||
Financing liability, non-current portion, net of debt discount | | | 90,090 | | | — | | | — | | | — | | | — | | | — | | | 90,090 |
Revolving line of credit | | | 45,000 | | | — | | | — | | | — | | | — | | | — | | | 45,000 |
Long term debt, non-current portion, net of debt discount | | | 312 | | | — | | | — | | | — | | | — | | | 41,698 | | | 42,010 |
Operating lease liability, non-current portion | | | 20,701 | | | — | | | 4,480 | | | 4,480 | | | — | | | — | | | 25,181 |
Deferred income tax liability | | | 15,389 | | | — | | | — | | | — | | | — | | | — | | | 15,389 |
Total liabilities | | | 530,773 | | | — | | | 5,500 | | | 5,500 | | | — | | | 106,292 | | | 642,565 |
| | | | | | | | | | | | | | ||||||||
Commitments and contingencies | | | | | | | | | | | | | | | |||||||
| | | | | | | | | | | | | | ||||||||
Series A convertible preferred stock; 600,000 shares designated, issued and outstanding; liquidation preference of $60,000 | | | 54,983 | | | — | | | — | | | — | | | — | | | — | | | 54,983 |
| | | | | | | | | | | | | |
| | Lazydays Holdings, Inc.(1) | | | Completed Acquisitions(2) | | | Planned Acquisitions | | | Financing Activity(3) | | | Pro Forma Combined | |||||||
| | Buddy Gregg | | | Century RV | | | Total | | ||||||||||||
Preferred stock, $0.0001 par value; 5,000,000 shares authorized | | | — | | | — | | | — | | | — | | | — | | | — | | | — |
Common stock, $0.0001 par value; 100,000,000 shares authorized; 17,328,483 and 14,515,253 shares issued and 13,916,261 and 11,112,464 shares outstanding | | | — | | | — | | | — | | | — | | | — | | | — | | | — |
Additional paid in capital | | | 162,211 | | | — | | | — | | | — | | | — | | | — | | | 162,211 |
Treasury stock, at cost, 3,412,222 and 3,402,789 shares | | | (57,128) | | | — | | | — | | | — | | | — | | | — | | | (57,128) |
Retained earnings | | | 166,487 | | | | | | | — | | | — | | | — | | | 166,487 | ||
Total stockholders' equity | | | 271,570 | | | — | | | — | | | — | | | — | | | — | | | 271,570 |
Total liabilities and stockholders' equity | | | 857,326 | | | — | | | 5,500 | | | 5,500 | | | — | | | 106,292 | | | 969,118 |
| | Lazydays Holdings, Inc.(1) | | | Completed Acquisitions(2) | | | Planned Acquisitions | | | Proforma Adjustments | | | | | Pro Forma Combined | |||||||||||
| | Findlay | | | Buddy Gregg | | | Century | | | Total | | |||||||||||||||
Revenues | | | | | | | | | | | | | | | | | | | |||||||||
New vehicle retail | | | 359,499 | | | 292 | | | 10,109 | | | 12,495 | | | 22,896 | | | 11,179 | | | — | | | | | 393,574 | |
Pre-owned vehicle retail | | | 175,766 | | | — | | | 3,597 | | | 2,964 | | | 6,561 | | | 4,501 | | | — | | | | | 186,828 | |
Vehicle wholesale | | | 3,424 | | | 77 | | | — | | | — | | | 77 | | | — | | | — | | | | | 3,501 | |
Finance and insurance | | | 34,623 | | | 18 | | | 920 | | | 1,377 | | | 2,315 | | | 713 | | | — | | | | | 37,651 | |
Service, body, parts and other | | | 30,724 | | | 172 | | | 2,068 | | | 790 | | | 3,030 | | | 2,835 | | | — | | | | | 36,588 | |
Total Revenue | | | 604,036 | | | 559 | | | 16,694 | | | 17,626 | | | 34,879 | | | 19,227 | | | — | | | | | 658,142 | |
Cost applicable to revenues (excluding depreciation, and amortization as shown below) | | | | | | | | | | | | | | | | | | | |||||||||
New vehicle retail | | | 311,475 | | | 247 | | | 9,732 | | | 10,854 | | | 20,834 | | | 10,370 | | | — | | | | | 342,679 | |
Pre-owned vehicle retail | | | 139,953 | | | (2) | | | 2,684 | | | 2,213 | | | 4,895 | | | 3,608 | | | — | | | | | 148,456 | |
Vehicle wholesale | | | 3,406 | | | 86 | | | — | | | | | 86 | | | — | | | — | | | | | 3,492 | ||
Finance and insurance | | | 1,503 | | | — | | | — | | | — | | | — | | | — | | | — | | | | | 1,503 | |
Service, body, parts and other | | | 14,698 | | | 92 | | | 1,111 | | | 381 | | | 1,584 | | | 1,019 | | | — | | | | | 17,301 | |
LIFO | | | 1,387 | | | — | | | — | | | — | | | — | | | — | | | — | | | | | 1,387 | |
Total cost applicable to revenue | | | 472,422 | | | 423 | | | 13,528 | | | 13,448 | | | 27,399 | | | 14,998 | | | — | | | | | 514,819 | |
Gross profit | | | 131,614 | | | 136 | | | 3,166 | | | 4,178 | | | 7,480 | | | 4,229 | | | — | | | | | 143,324 | |
Depreciation and amortization | | | 8,862 | | | 2 | | | 88 | | | — | | | 89 | | | — | | | 158 | | | (3) | | | 9,109 |
Selling, general and administrative expenses | | | 104,012 | | | 327 | | | 3,112 | | | 4,072 | | | 7,511 | | | 3,480 | | | (809) | | | (4) | | | 114,194 |
Income from operations | | | 18,740 | | | (193) | | | (33) | | | 106 | | | (120) | | | 750 | | | 651 | | | | | 20,020 | |
Other income (expense) | | | | | | | | | | | | | | | | | | | |||||||||
Floorplan interest expense | | | (11,366) | | | — | | | (415) | | | (128) | | | (543) | | | (508) | | | (2,693) | | | (5) | | | (15,111) |
Other interest expense | | | (3,783) | | | — | | | (210) | | | — | | | (210) | | | (7) | | | (1,232) | | | (6) | | | (5,231) |
Interest income | | | — | | | | | | | | | | | 0 | | | | | | | 0 | ||||||
Change in fair value of warrant liabilities | | | 856 | | | — | | | — | | | — | | | — | | | — | | | — | | | | | 856 | |
Total other (expense) income, net | | | (14,293) | | | — | | | (625) | | | (128) | | | (753) | | | (515) | | | (3,925) | | | | | (19,486) | |
Income before income tax expense | | | 4,447 | | | (193) | | | (658) | | | (23) | | | (874) | | | 235 | | | (3,274) | | | | | 534 | |
Income tax expense | | | (1,163) | | | 51 | | | 172 | | | 6 | | | 229 | | | (61) | | | 856 | | | (7) | | | (140) |
Net income | | | 3,284 | | | (143) | | | (486) | | | (17) | | | (645) | | | 174 | | | (2,418) | | | | | 394 | |
Dividends on Series A Convertible Preferred Stock | | | (2,380) | | | — | | | — | | | — | | | — | | | — | | | — | | | | | (2,380) | |
Net income and comprehensive income attributable to common stock and participating securities | | | 904 | | | (143) | | | (486) | | | (17) | | | (645) | | | 174 | | | (2,418) | | | | | (1,986) | |
| | | | | | | | | | | | | | | | | | ||||||||||
EPS: | | | | | | | | | | | | | | | | | | | |||||||||
Basic | | | $0.05 | | | | | | | | | | | | | | | | | $(0.15) | |||||||
Diluted | | | $— | | | | | | | | | | | | | | | | | $(0.15) | |||||||
| | | | | | | | | | | | | | | | | | ||||||||||
Weighted average shares outstanding | | | | | | | | | | | | | | | | | | | |||||||||
Basic | | | 13,066,607 | | | | | | | | | | | | | | | | | 13,066,607 | |||||||
Diluted | | | 13,188,135 | | | | | | | | | | | | | | | | | 13,188,135 |
(3)the Rights by that Holder will be rounded down to the nearest whole share for purposes of determining the number of shares of our Common Stock for which you may subscribe, with such adjustments as may be necessary to ensure that we offer a maximum of 15,627,441 shares of Common Stock in the Rights Offering.
(4) OfStock and Warrants for U.S. federal income tax purposes. This position regarding the warrants offered, 1,335,415non-taxable treatment of the warrantsRights Offering is not binding on the IRS or the courts. The fair market value of the Rights would be taxable to U.S. Holders of our Common Stock as a dividend to the extent of the U.S. Holder’s pro rata share of our current and accumulated earnings and profits, if any, with any excess being treated as a return of capital to the extent thereof and then as capital gain. The Company believes that it may have an exercise pricecurrent and accumulated earnings and profits through the end of $11.50 per share2023. Further, if the Rights Offering is treated as a taxable distribution, the treatment of holders of Warrants is not clear, and 300,357it may differ from, and may be more adverse than, the treatment of the Rights distribution to the holders of Common Stock. For a more detailed discussion, including U.S. federal income tax considerations applicable to Non-U.S. Holders, see “Material U.S. Federal Income Tax Consequences.” You should consult your tax advisor as to the particular considerations applicable to you of the Rights Offering.
the statements in this section of the prospectus are forward-looking statements. For more information, see the sections of this prospectus titled “Incorporation of Information by Reference” and “Special Note Regarding Forward-Looking Statements.” The annualized EBITDA and adjusted EBITDA estimates presented in this prospectus are based on the annualization of projected financial results from limited periods before our acquisition of those businesses. They also incorporate assumptions about future steady-state performance. These do not reflect the actual historical results for any period of such acquisitions. In Company and our brands.a high degree of risk. Investorsrisks. Before making an investment decision, you should carefully consider the specific risks described below, the risks described under the caption “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 and allin our Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2023 and June 30, 2023, which are incorporated herein by reference, as well as other risk factors described under the caption “Risk Factors” included or incorporated by reference in the prospectus, including our other filings with the SEC, before making an investment decision.otherrisks we describe below or in the information set forth in this Registration Statement on Form S-1 before deciding to invest in our common stock. If any of the events or developments described below occur,incorporated herein by reference could cause our business, financial condition or operating results of operations could be materially or adversely affected. As a result, theto suffer. The market price of our common stockCommon Stock could decline if one or more of these risks and investorsuncertainties develop into actual events. You could lose all or part of your investment. Additional risks and uncertainties not currently known to us or allthat we currently deem to be immaterial also may materially adversely affect our business, financial condition or operating results. Some of their investment.LazydaysOur BusinessThe Company’s success will depend to a significant extent on the wellbeing, as well as the continued popularity and reputation for quality, of the Company’s manufacturers, particularly, Thor Industries, Inc., Winnebago Industries, Inc. and Forest River, Inc.The Company depends on its manufacturers to provide it with products that compare favorably with competing products in terms of quality, performance, safety and advanced features. Any adverse change in the production efficiency, product development efforts, technological advancement, marketplace acceptance, reputation, marketing capabilities or financial condition of the Company’s manufacturers could have a substantial adverse impact on the Company’s business. Any difficulties encountered by any of the Company’s manufacturers resulting from economic, financial, or other factors could adversely affect the quality and number of products that they are able to supply to the Company and the services and support they provide to the Company. The interruption or discontinuance of the operations of the Company’s manufacturers could cause the Company to experience shortfalls, disruptions, or delays with respect to needed inventory. Although the Company believes that adequate alternate sources would be available that could replace any manufacturer as a product source, those alternate sources may not be available at the time of any interruption, alternative products may not be available at comparable quality and prices and alternative products may not be equally appealing to the Company’s customers.The Company is currently ineligible to file a registration statement on Form S-3 to register the offer and sale of securities, which could adversely affect its ability to raise future capital.As a result of the delayed filing of a periodic report on Form 10-Q and current report on Form 8-K, the Company is not currently eligible to file a new registration statement on Form S-3. Should the Company wish to register the offer and sale of its securities to the public once its existing registration statement on Form S-3 expires, both the transaction costs and the amount of time required to complete the transaction could increase, making it more difficult to execute any such transaction successfully and potentially harming the Company’s financial condition.The COVID-19 pandemic had a significant adverse impact on the Company’s business, results of operations and financial condition in the first months of the COVID-19 pandemic; while increased sales since then have more than offset the initial adverse impact, there can be no assurance that such sales growth will continue at the same rate or at all, and the Company’s sales may ultimately decline, meaning that, in the long term, COVID-19 could result in a net negative impact on its business.In March 2020, the World Health Organization declared the outbreak of the novel coronavirus disease COVID-19 a pandemic, which continues to spread throughout the United States and globally. Beginning in mid-to-late March of 2020, the COVID-19 pandemic led to severe disruptions in general economic activity as businesses and federal, state and local governments took increasingly broad actions to mitigate the impact of the COVID-19 pandemic on public health, including through “shelter in place” or “stay at home” orders in the states in which we operate. As we modified our business practices to conform to government guidelines and best practices to ensure the health and safety of our customers, employees and the communities we serve, we saw significant early declines in new and pre-owned vehicle unit sales, sales of parts, accessories and related services, including finance and insurance revenues as well as campground and miscellaneous revenues.In response to the steep decline in demand, the Company enacted cost saving measures, including the reduction of our workforce by approximately 25% and senior management agreeing to temporarily forgo 25% of their salary. To further protect our liquidity and cash position, we negotiated with our lenders for the temporary suspension of scheduled principal and interest payments on our term and mortgage loans from April 15, 2020 through June 15, 2020 and for the temporary suspension of scheduled floorplan curtailment payments from April 1, 2020 through June 15, 2020. We also received $8.7 million in loans under the Paycheck Protection Program.Starting in May 2020, we experienced significant improvement in sales of new and pre-owned vehicles. The improvement in sales beginning in May 2020 likely relates, at least in part, to an increase in consumer demand as consumers seek outdoor travel and leisure activities that permit appropriate social distancing. However, we can provide no assurances that suchsales will continue at the same rate that occurred between May 2020 and September 2021, or at all, over any time period, and sales may ultimately decline. Furthermore, our improved sales and cost savings measures to date may not be sufficient to offset any later adverse impacts of the COVID-19 pandemic, and our liquidity could be negatively impacted, if prior sales trends from May 2020 through September 2021 are reversed, which may occur, for example, if the cruise line, air travel and hotel industries begin to recover.4The public health crisis caused by the COVID-19 pandemic and its consequences have had, and could again have in the future, certain negative impacts on our business including, without limitation, the following:●previous and potentially future delays in the delivery of certain products from our vendors as a result of shipping delays due to, among other things, additional safety requirements imposed on our suppliers by governmental authorities and capacity constraints experienced by our transportation contractors;●some of our vendors having experienced, and potentially experiencing in the future, temporary facility closures, production slowdowns and disruption to operations as a result of the impact of the pandemic on their respective businesses, such as Thor Industries, Inc.’s temporary closure of its North American production facilities from late March to early May 2020;●disruptions in supply chains that may place constraints on our ability to source products, which may increase our product costs or lead to shortages;●national parks and RV parks temporarily closing, which may again occur in the future, in response to the COVID-19 pandemic, which could cause consumers to use their RVs less frequently, or be less inclined to need or renew certain of our services or purchase products;●deteriorating economic conditions as a result of the COVID-19 pandemic, such as increased unemployment, decreases in disposable income, decreases in net worth, declines in consumer confidence, or economic slowdowns or recessions, which could cause a decrease in demand for our products and services;●insufficient or inefficient protective measures (while we made temporary changes to our operating procedures at our retail locations and offices following recommended guidelines and are taking measures to protect our customers, employees and facilities, these measures may not be sufficient to prevent the spread of COVID-19 among our employees and our employees may not be as efficient while operating under these temporary procedures, which could result in labor shortages or additional labor costs);●the ability of third-party service providers and business partners, such as cloud data storage and other information technology service providers, suppliers, distributors, contractors, and other external business partners, to fulfill their respective commitments and responsibilities to us in a timely manner and in accordance with the agreed-upon terms in light of risks and uncertainties related to the COVID-19 pandemic; and●the possibility of legal claims or litigation against us relating to actions we have taken or may take, or decisions we have made or may make, as a consequence of the COVID-19 pandemic.The Biden administration recently announced a proposed regulation requiring all U.S. private businesses with 100 or more employees to ensure that their employees are fully vaccinated or require unvaccinated workers to undergo weekly COVID-19 testing. At this time, it is unclear if the vaccine mandate will apply to all employees and how compliance will be documented.The extent to which the COVID-19 pandemic ultimately impacts our business, results of operations, and financial condition will depend on future developments, which are highly uncertain and cannot be predicted, including the severity and duration of the COVID-19 pandemic, the efficacy, availability, distribution and public acceptance of vaccines and further actions that may be taken by individuals, businesses and federal, state and local governments in response. Even after the COVID-19 pandemic has subsided, we may experience significant adverse effects to our business as a result of its global economic impact, including any economic recession or downturn and the impact of such a recession or downturn on unemployment levels, consumer confidence, levels of personal discretionary spending, credit availability and any long term disruption in supply chains.The Company’s business is affected by the availability of financing to it and its customers.The Company’s business is affected by the availability of financing to it and its customers. Generally, RV dealers finance their purchases of inventory with financing provided by lending institutions. On March 15, 2018, the Company entered into a $200 million credit agreement with M&T Bank including a new floor plan facility that increased the committed floor plan financing to $175.0 million. On February 13, 2021, the Company signed an agreement to extend the maturity date of the credit agreement to June 15 2021. On June 14, 2021, an additional agreement was signed to extend the maturity date to September 15, 2021. On July 14, 2021, the Company entered into a $369 million credit agreement with M&T Bank including an increase to the committed floor plan financing to $327 million. As of September 30, 2021, the Company had $94.7 million outstanding under its M&T floor plan facility, $10.8 million outstanding under the M&T term loan, a $5.8 million mortgage financed by M&T Bank, and no borrowings under our recently expanded $25 million dollar revolving credit facility. As of September 30, 2021, substantially all of the invoice cost of new RV inventory and approximately 5% of book value of pre-owned RV inventory was financed under the floor plan facility. A decrease in the availability of this type of wholesale financing or an increase in the cost of such wholesale financing could prevent the Company from carrying adequate levels of inventory, which may limit product offerings and could lead to reduced sales and revenues.5Furthermore, many of the Company’s customers finance their RV purchases. Although consumer credit markets have generally been favorable, consumer credit market conditions continue to influence demand, especially for RVs, and may continue to do so. There continues to be fewer lenders, more stringent underwriting and loan approval criteria, and greater down payment requirements than in the past. If credit conditions or the credit worthiness of the Company’s customers worsen, and adversely affect the ability of consumers to finance potential purchases on acceptable terms and interest rates, it could result in a decrease in the sales of the Company’s products and have a material adverse effect on the Company’s business, financial condition and results of operations.Any change, non-renewal, unfavorable renegotiation or termination of the Company’s supply arrangements for any reason could have a material adverse effect on product availability and cost and the Company’s financial performance.The Company’s supply arrangements with manufacturers are typically governed by dealer agreements, which are customary in the RV industry. The Company’s dealer agreements with manufacturers are generally made on a location-by-location basis, and each retail location typically enters into multiple dealer agreements with multiple manufacturers. The terms of the Company’s dealer agreements are typically subject to the Company meeting program requirements and retail sales objectives, performing services and repairs for customers still under warranty (regardless from whom the RV was purchased), carrying the relevant manufacturer’s parts and accessories needed to service and repair its RVs, actively advertising and promoting the manufacturer’s RVs, and in some instances indemnifying the manufacturer.The Company’s dealer agreements designate a specific geographic territory for the Company, exclusive to the Company, provided that the Company is able to meet the material obligations of the agreement.In addition, many of the Company’s dealer agreements contain contractual provisions concerning minimum advertised product pricing for current model year units. Wholesale pricing is generally established on a model year basis and is subject to change in the manufacturer’s sole discretion. Any change, non-renewal, unfavorable renegotiation or termination of these dealer agreements for any reason could have a material adverse effect on product availability and cost and the Company’s financial performance.The Company’s business is impacted by general economic conditions in its markets, and ongoing economic and financial uncertainties may cause a decline in consumer spending that may adversely affect its business, financial condition and results of operations.The Company depends on consumer discretionary spending and, accordingly, the Company may be adversely affected if its customers reduce, delay or forego their purchases of the Company’s products, services, and protection plans as a result of, including but not limited to, job loss, bankruptcy, higher consumer debt and interest rates, reduced access to credit, higher energy and fuel costs, relative or perceived cost, availability and comfort of RV use versus other modes of travel, such as air travel and rail (including as a result of consumer tastes in response to climate change), falling home prices, lower consumer confidence, uncertain or changes or uncertainty in tax policies, uncertainty due to national or international security or health concerns, volatility in the stock market, or epidemics.Decreases in the number of customers, average spend per customer, or retention and renewal rates for the Company’s products, consumer services and plans would negatively affect the Company’s financial performance. A prolonged period of depressed consumer spending could have a material adverse effect on the Company’s business. In addition, adverse economic conditions may result in an increase in the Company’s operating expenses due to, among other things, higher costs of labor, energy, equipment and facilities. Due to recent fluctuations in the United States economy and the COVID-19 pandemic, the Company’s sales, operating and financial results for a particular period are difficult to predict, making it difficult to forecast results for future periods. Additionally, the Company is subject to economic fluctuations in local markets that may not reflect the general economic conditions of the broader United States economy. Any of the foregoing factors could have a material adverse effect on the Company’s business, financial condition and results of operations.The Company depends on its ability to attract and retain customers.The Company’s future success depends upon the Company’s ability to attract and retain customers for its products, services, protection plans, and resources. The extent to which the Company achieves growth in its customer base materially influences the Company’s profitability. Any number of factors could affect the Company’s ability to grow its customer base. These factors include consumer preferences and general economic conditions, the Company’s ability to maintain its retail locations, weather conditions, the availability of alternative products, significant increases in gasoline prices, the disposable income of consumers available for discretionary expenditures and consumer perception of the Company’s brands. Any significant decline in the Company’s customer base, the rate of growth of its customer base or customer demand could have a material adverse effect on its business, financial condition and results of operations.6Competition in the market for products, services and protection plans targeting the RV lifestyle or RV enthusiast could reduce the Company’s revenues and profitability.Competition in the RV market is fragmented, driven by price, product and service features, technology, performance, reliability, quality, availability, variety, delivery and customer service. In addition to competing with other dealers of new and pre-owned RVs, the Company competes directly or indirectly with major national insurance and warranty companies, providers of roadside assistance and providers of extended service contracts.Additional competitors may enter the businesses in which the Company currently operates. If any of the Company’s competitors successfully provides a broader, more efficient or attractive combination of products, services and protection plans to the Company’s target customers, the Company’s business results could be materially adversely affected. The Company’s inability to compete effectively with existing or potential competitors, some of which may have greater resources or be better positioned to absorb economic downturns in local markets, could have a material adverse effect on the Company’s business, financial condition and results of operations.The Company’s expansion into new, unfamiliar markets, whether through acquisitions or otherwise, presents increased risks that could materially affect profitability. Furthermore, our presentation of estimated annualized adjusted EBITDA for acquired businesses do not represent actual historical results for any period and may prevent it from being profitable in these new markets. Delays in acquiring or opening new retail locations could have a material adverse effect on the Company’s business, financial condition and resultsnot be reflective of operations.The Company’sour future performance.theour ability of the Company to make successful acquisitions and to integrate the operations of acquired retail locations, including centralizing certain functions to achieve cost savings and pursuing programs and processes that promote consistencycooperation and efficiencythe sharing of opportunities and resources among the Company’sour retail locations. The Companylocations and consumer services and plans. We may not be able to achieve the estimated revenue, EBITDA or adjusted EBITDA contributions, the anticipated operating and cost synergies or long-term strategic benefits of itsour acquisitions within the anticipated timing or at all. For as long as the first year after a substantial acquisition and possibly longer, the benefits from the acquisition may be offset by the costs incurred in integrating the business and operations.2020,addition, the Companyestimates are based on certain internal, unaudited financial statements of the acquired three dealerships in Arizonaentities. These unaudited statements haven't undergone our internal control procedures nor have they been reviewed by our external auditors. The periods selected for annualization may not be representative of performance over an extended period and Indiana. Through Augustmay not take into account other future market conditions that may negatively affect those businesses. As such, the estimated long-term figures could significantly differ from the EBITDA or adjusted EBITDA these businesses might have generated if acquired at a different time. Such discrepancies could be material to our business and operations. We cannot assure that future performances will match these estimates, and deviations from those estimates could adversely affect our financial results and business operations. Thus, you should not place undue reliance on these estimates.2021,intent for other proposed acquisitions. Non-binding letters of intent do not commit either party to complete the Company added two Tennessee dealerships (one acquiredtransaction. Acquisition negotiations are subject to a variety of factors, many of which are not within our control and one greenfield)thus we can provide no assurance that we will successfully negotiate acquisition agreements and acquired three dealerships, one located in eachconsummate acquisitions proposed under our non-binding letters of Oregon, Washington, and Wisconsin. The Company intendsintent. We intend to continue to expand in part by acquiring or building new greenfield retail or service locations in new markets. As a result the Companyof any future expansion, we may have less familiarity with local consumer preferences and could encounter difficulties in attracting customers due to a reduced level of consumer familiarity with the Company’s brand.the Company’sour control, may impact the Company’sour ability to acquire or open retail locations successfully, whether in existing or new markets, and operate them profitably. These factors include:include (a) the ability to (i) identify suitable acquisition opportunities at purchase prices likely to provide returns required by the Company’sour acquisition criteria, (ii) keepcontrol expenses associated with sourcing, evaluating and negotiating acquisitions (including those that are not completed) low,, (iii) accurately assess the profitability of potential acquisitions or new
Finally, the size, timing, and integration of any future new retail location openings or acquisitions may cause substantial fluctuations in the Company’sour results of operations from quarter to quarter. Consequently, the Company’sour results of operations for any quarter may not be indicative of the results that may be achieved for any subsequent quarter or for a full fiscal year. These fluctuations could have a material adverse effect on the Company’sour business, financial condition and results of operations.
Failure to maintain the strength and value of the Company’s brands could have a material adverse effect on the Company’s business, financial condition and results of operations.
The Company’s success depends on the value and strength of the Lazydays brands. The Lazydays name and brands are integral to the Company’s business as well as to the implementation of the Company’s strategies for expanding its business. Maintaining, enhancing, promoting and positioning the Company’s brands, particularly in new markets where the Company has less brand recognition, will depend largely on the success of the Company’s marketing efforts and its ability to provide high quality products, services, protection plans, and resources and a consistent, high quality customer experience. The Company’s brands could be adversely affected if: (a) the Company fails to achieve these objectives or to comply with local laws and regulations; (b) the Company is subject to publicized litigation; or (c) the Company’s public image or reputation were to be tarnished by negative publicity. Some of these risks are not within the Company’s control, such as the effects of negative publicity regarding the Company’s manufacturers, suppliers or third party providers of services or negative publicity related to members of management. Any of these events could result in decreases in revenues. Further, maintaining, enhancing, promoting and positioning the Company’s brand image may require the Company to make substantial investments in areas such as marketing, dealership operations, community relations, store graphics and employee training, which could adversely affect the Company’s cash flow and profitability. Efforts to maintain, enhance or promote the Company’s brand image may ultimately be unsuccessful. These factors could have a material adverse effect on the Company’s business, financial condition and results of operations.
Failure to successfully procure and manage inventory to reflect consumer demand in a volatile market and anticipate changing consumer preferences and buying trends could have a material adverse effect on the Company’s business, financial condition and results of operations.
The Company’s success depends upon the Company’s ability to successfully manage the Company’s inventory and to anticipate and respond to product trends and consumer demands in a timely manner. The preferences of the Company’s target consumers cannot be predicted with certainty and are subject to change. The Company may order products in advance of the following selling season. Extended lead times for the Company’s purchases may make it difficult for the Company to respond rapidly to new or changing product trends, increases or decreases in consumer demand or changes in prices. If the Company misjudges either the market for the Company’s products or its consumers’ purchasing habits in the future, the Company’s revenues may decline significantly, the Company may not have sufficient inventory to satisfy consumer demand or sales orders, or the Company may be required to discount excess inventory; all of which could have a material adverse effect on the Company’s business, financial condition and results of operations.
The Company’s same store sales may fluctuate and may not be a meaningful indicator of future performance.
The Company’s same store sales may vary from quarter to quarter. A number of factors affect and will continue to affect the Company’s same store sales results, including: (a) changes or anticipated changes to regulations related to the products the Company offers; (b) consumer preferences and buying trends; (c) overall economic trends; (d) the Company’s ability to identify and respond effectively to local and regional trends and customer preferences; (e) the Company’s ability to provide quality customer service that will increase its conversion of shoppers into paying customers; (f) competition in the regional market of a store; (g) extreme weather patterns; (h) changes in the Company’s product mix; (i) changes to local or regional regulations affecting the Company’s stores; (j) changes in sales of consumer services and plans and retention rates for consumer services and plans offered by the Company; and (k) changes in pricing and average unit sales.
An unanticipated decline in revenues or same store sales could have a material adverse effect on the Company’s business, financial condition and results of operations.
The cyclical nature of the Company’s business has caused its sales and results of operations to fluctuate. These fluctuations are likely to continue in the future, which could result in operating losses during downturns.
The RV industry is cyclical and is influenced by many national and regional economic and demographic factors, including: (a) the terms and availability of financing for retailers and consumers; (b) overall consumer confidence and the level of discretionary consumer spending; (c) population and employment trends; and (d) income levels and general economic conditions, such as inflation, including as a result of tariffs, deflation, increasing interest rates and recessions. As a result of these factors, the Company’s sales and results of operations have fluctuated, and the Company expects that they will continue to fluctuate in the future.
The Company’s business is seasonal, and this leads to fluctuations in sales and revenues.
The Company has experienced, and expects to continue to experience, variability in revenue, net income and cash flows as a result of seasonality in its business. Because the Company’s largest dealership is located in the southern United States, demand for products, services, protection plans and resources generally increases during the winter season when people move south for the winter or vacation in warmer climates, while sales and profits are generally lower during the summer months. In addition, unusually severe weather conditions in some geographic areas may impact demand. This includes the threat of hurricanes in the State of Florida, which could substantially damage property and inventory in the Company’s Florida dealerships, especially in Tampa, and lead to a material disruption of operations at the Company’s Tampa, Florida headquarters and dealership.
For the years ended December 31, 2020 and 2019, the Company generated 51% and 53% (excluding the impact of acquisitions) of its annual revenue, respectively, in the combined first and second fiscal quarters of each year, which includes the peak winter months. The COVID-19 pandemic affected our sales patterns in 2020. The Company incurs additional expenses in the first and second fiscal quarters due to higher purchase volumes, increased staffing in the Company’s retail locations and other costs. If, for any reason, the Company miscalculates the demand for its products or its product mix during the first and second fiscal quarters, the Company’s sales in these quarters could decline, resulting in higher labor costs as a percentage of sales, lower margins and excess inventory, which could have a material adverse effect on the Company’s business, financial condition and results of operations.
Due to the Company’s seasonality, the possible adverse impact from other risks associated with its business, including extreme weather, consumer spending levels and general business conditions, are potentially greater if any such risks occur during the Company’s peak sales seasons.
The Company’s business may be adversely affected by unfavorable conditions in its local markets, even if those conditions are not prominent nationally.
Because a large portion of the Company’s sales are generated in Florida, the Company’s results of operations depend substantially on general economic conditions and consumer spending habits in the Southeastern United States. In the event that this geographic area experiences a downturn in economic conditions, it could have a material adverse effect on the Company’s business, financial condition and results of operations.
Risks Associated with Our Debt Obligations
The Company may not be able to satisfy its debt obligations upon the occurrence of a change in control under its credit facility.
A change in control is an event of default under the credit facility. Upon the occurrence of a change in control, M&T Bank will have the right to declare all outstanding obligations under the credit facility immediately due and payable and to terminate the availability of future advances to the Company. There can be no assurance that the Company’s lenders will agree to an amendment of the credit facility or a waiver of any such event of default. There can be no assurance that the Company will have sufficient resources available to satisfy all of its obligations under the credit facility if no waiver or amendment is obtained. In the event the Company was unable to satisfy these obligations, it could have a material adverse impact on the Company’s business, financial condition and results of operations.
The Company’s ability to operate and expand its business and to respond to changing business and economic conditions will depend on the availability of adequate capital.
The operation of the Company’s business, the rate of the Company’s expansion and the Company’s ability to respond to changing business and economic conditions depend on the availability of adequate capital, which in turn depends on cash flow generated by the Company’s business and, if necessary, the availability of equity or debt capital. The Company also requires sufficient cash flow to meet its obligations under its existing debt agreements. The Company’s term loan requires it to pay monthly principal installments of $0.242 million plus accrued interest through the maturity date. At the maturity date, the Company will pay a principal balloon payment of $2.6 million plus accrued interest.
The Company is dependent to a significant extent on its ability to finance its new and pre-owned RV inventory under the credit facility. Floor plan financing arrangements allow the Company to borrow money to purchase new RVs from the manufacturer or pre-owned RVs on trade-in, direct purchase from owners, or at auction and pay off the loan when the Company sells the financed RV. The Company may need to increase the capacity of its existing credit facility in connection with its acquisition of dealerships and overall growth. In the event that the Company is unable to obtain such incremental financing, the Company’s ability to complete acquisitions could be limited.
The Company cannot ensure that its cash flow from operations or cash available under its credit facility will be sufficient to meet its needs. If the Company is unable to generate sufficient cash flows from operations in the future, and if availability under its credit facility is not sufficient, the Company may have to obtain additional financing. If the Company obtains additional capital through the issuance of equity, the interests of existing stockholders of the Company may be diluted. If the Company incurs additional indebtedness, such indebtedness may contain financial covenants and other negative covenants that may significantly restrict the Company’s ability to operate. The Company cannot ensure that it could obtain additional financing on favorable terms or at all.
The documentation governing the Company’s credit facility contains restrictive covenants that may impair the Company’s ability to access sufficient capital and operate its business.
The Company’s credit facility contains various provisions that limit the Company’s ability to, among other things: (a) incur additional indebtedness or liens; (b) consolidate or merge; (c) alter the business conducted by the Company and its subsidiaries; (d) make investments, loans, advances, guarantees and acquisitions; (e) sell assets, including capital stock of its subsidiaries; (f) enter into certain sale and leaseback transactions; (g) pay dividends on capital stock or redeem, repurchase or retire capital stock or certain other indebtedness; and (h) engage in transactions with affiliates.
In addition, the restrictive covenants contained in the documentation governing the credit facility require the Company to maintain specified financial ratios. The Company’s ability to comply with those financial ratios may be affected by events beyond its control, and its failure to comply with these ratios could result in an event of default. The restrictive covenants may affect the Company’s ability to operate and finance its business as it deems appropriate. The Company’s inability to meet obligations as they become due or to comply with various financial covenants contained in the instruments governing its current or future indebtedness could constitute an event of default under the instruments governing the Company’s indebtedness.
If there were an event of default under the instruments governing the Company’s indebtedness, the holders of the affected indebtedness could declare all of the affected indebtedness immediately due and payable, which, in turn, could cause the acceleration of the maturity of all of the Company’s other indebtedness. The Company may not have sufficient funds available, or the Company may not have access to sufficient capital from other sources, to repay any accelerated debt. Even if the Company could obtain additional financing, the terms of such financing may not be favorable to the Company. In addition, substantially all of the Company’s assets are subject to liens securing the obligations under the credit facility. If amounts outstanding under the credit facility were accelerated, the Company’s lenders could foreclose on these liens and the Company could lose substantially all of its assets. Any event of default under the instruments governing the Company’s indebtedness could have a material adverse effect on the Company’s business, financial condition and results of operations.
The Company depends on its relationships with third party providers of services, protection plans, financing, insurance, products and resources and a disruption of these relationships or of these providers’ operations could have an adverse effect on the Company’s business and results of operations. The Company cannot ensure these third parties will continue to provide RV financing and other products.
The Company’s business depends in part on developing and maintaining productive relationships with third party providers of products, services, protection plans, financing, insurance and resources that the Company markets to its customers. Additionally, the Company relies on certain third party providers to support its products, services, protection plans, financing, insurance and resources, including insurance carriers for the Company’s property and casualty insurance and extended service contracts and banks or vehicle financing and refinancing. The Company cannot accurately predict whether, or the extent to which, it will experience any disruption in the supply of products from its vendors or services from its third party providers, and cannot ensure that these third parties will continue to provide such products. Any such disruption could negatively impact the Company’s ability to market and sell its products, services, protection plans, and resources, which could have a material adverse effect on the Company’s business, financial condition and results of operations.
With respect to the insurance programs that the Company offers, the Company is dependent on the insurance carriers that underwrite the insurance to obtain appropriate regulatory approvals and maintain compliance with insurance regulations. If such carriers do not obtain appropriate state regulatory approvals or comply with such changing regulations, the Company may be required to use an alternative carrier or change its insurance products or cease marketing certain insurance related products in certain states, which could have a material adverse effect on the Company’s business, financial condition and results of operations. If the Company is required to use an alternative insurance carrier or change its insurance related products, it may materially increase the time required to bring an insurance related product to market. Any disruption in the Company’s service offerings could harm the Company’s reputation and result in customer dissatisfaction.
Additionally, the Company provides financing to qualified customers through a number of third party financing providers. If one or more of these third party providers ceases to provide financing to the Company’s customers, provides financing to fewer customers or no longer provides financing on competitive terms, or if the Company is unable to replace the current third party providers upon the occurrence of one or more of the foregoing events, it could have a material adverse effect on the Company’s business, financial condition and results of operations.
A portion of the Company’s revenue comes from the fees the Company receives from lending institutions and insurance companies for arranging financing and insurance coverage for the Company’s customers. The lending institution pays the Company a fee for each loan that it arranges. If these lenders were to lend to the Company’s customers directly rather than through the Company, the Company would not receive a fee. In addition, if customers prepay financing the Company arranged within a specified period (generally within six months of making the loan), the Company is required to rebate (or “chargeback”) all or a portion of the commissions paid to the Company by the lending institution. The same process applies to vehicle services contract fees, which are also subject to chargebacks if a customer chooses to terminate the contract early. The Company receives a chargeback for a portion of the initial fees received. The Company’s revenues from financing fees and vehicle service contract fees are recorded net of a reserve for estimated future chargebacks based on historical operating results. Lending institutions may change the criteria or terms they use to make loan decisions, which could reduce the number of customers for whom the Company can arrange financing, or may elect to not continue to provide these products with respect to RVs. The Company’s customers may also use the internet or other electronic methods to find financing alternatives. If any of these events occur, the Company could lose a significant portion of its income and profit.
Furthermore, new and pre-owned vehicles may be sold and financed through retail installment sales contracts entered into between the Company and third-party purchasers. Prior to entering into a retail installment sales contract with a third-party purchaser, the Company typically has a commitment from a third-party lender for the assignment of such retail installment sales contract, subject to final review, approval and verification of the retail installment sales contract, related documentation and the information contained therein. Retail installment sales contracts are typically assigned by the Company to third-party lenders simultaneously with the execution of the retail installment sales contracts. Contracts in transit represent amounts due from third-party lenders from whom pre-arranged assignment agreements have been determined, and to whom the retail installment sales contract have been assigned. The Company recognizes revenue when the applicable new or pre-owned vehicle is delivered and the Company has assigned the retail installment sales contract to a third-party lender and collectability is reasonably assured. Funding from the third-party lender is provided upon receipt, final review, approval and verification of the retail installment sales contract, related documentation and the information contained therein. Retail installment sales contracts are typically funded within ten days of the initial approval of the retail installment sales contract by the third-party lender. Contracts in transit are included in current assets and totaled $16.0 million and $11.5 million as of December 31, 2020 and December 31, 2019, respectively. Any defaults on these retail installment sales contracts could have a material adverse effect on the Company’s business, financial condition and results of operations.
Fuel shortages, or high prices for fuel, could have a negative effect on the Company’s business.
Gasoline or diesel fuel is required for the operation of RVs. There can be no assurance that the supply of these petroleum products will continue uninterrupted, that rationing will not be imposed, or that the price of or tax on these petroleum products will not significantly increase in the future. Shortages of gasoline and diesel fuel have had a material adverse effect on the RV industry as a whole in the past and any such shortages or substantial increases in the price of fuel could have a material adverse effect on the Company’s business, financial condition or results of operations.
The Company primarily leases its retail locations. If the Company is unable to maintain those leases or locate alternative sites for retail locations in its target markets and on terms that are acceptable to it, the Company’s revenues and profitability could be adversely affected.
The Company leases 13 of the 16 real properties where it has operations. At inception of the leases, they generally provide for fixed monthly rentals with escalation clauses and range from five to twenty years. There can be no assurance that, as leases expire, the Company will be able to maintain its existing retail locations, extend the leases, or be able to locate alternative sites in its target markets and on favorable terms. Any failure to maintain its existing retail locations, extend the leases or locate alternative sites on favorable or acceptable terms could have a material adverse effect on the Company’s business, financial condition and results of operations.
The Company’s business is subject to numerous federal, state and local regulations.
The Company’s operations are subject to varying degrees of federal, state and local regulation, including regulations with respect to the Company’s RV sales, RV financing, marketing, direct mail, roadside assistance programs and insurance activities. New regulatory efforts may be proposed from time to time that may affect the way the Company operates its businesses. For example, in the past a principal source of leads for the Company’s direct response marketing efforts was new vehicle registrations provided by motor vehicle departments in various states. Currently, all states restrict access to motor vehicle registration information.
The Company is also subject to federal and state consumer protection and unfair trade practice laws and regulations relating to the sale, transportation and marketing of motor vehicles. Federal, state and local laws and regulations also impose upon vehicle operators various restrictions on the weight, length and width of motor vehicles that may be operated in certain jurisdictions or on certain roadways. Certain jurisdictions also prohibit the sale of vehicles exceeding length restrictions.
Further, certain federal and state laws and regulations affect the Company’s activities. Areas of the Company’s business affected by such laws and regulations include, but are not limited to, labor, advertising, consumer protection, digital marketing, real estate, promotions, quality of services, intellectual property, tax, import and export, anti-corruption, anti-competition, environmental, health and safety. Compliance with these laws and others may be onerous and costly, at times, and may be inconsistent from jurisdiction to jurisdiction which further complicates compliance efforts.
The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), which was signed into law on July 21, 2010, established the Bureau of Consumer Financial Protection (“BCFP”), an independent federal agency with broad regulatory powers and limited oversight from the United States Congress. Although automotive dealers are generally excluded, the Dodd-Frank Act could lead to additional, indirect regulation of automotive dealers, in particular, their sale and marketing of finance and insurance products, through its regulation of automotive finance companies and other financial institutions.
In addition, the Patient Protection and Affordable Care Act (the “Affordable Care Act”), which was signed into law on March 23, 2010, may increase the Company’s annual employee health care costs and has increased the Company’s cost of compliance and compliance risk related to offering health care benefits. Efforts to modify, repeal or otherwise invalidate all, or certain provisions of, the Affordable Care Act and/or adopt a replacement healthcare reform law may impact the Company’s employee healthcare costs. If healthcare costs rise, the Company may experience increased operating costs, which may adversely affect the Company’s business, financial condition and results of operations.
Furthermore, the Company’s property and casualty insurance programs that it offers through third party insurance carriers are subject to state laws and regulations governing the business of insurance, including, without limitation, laws and regulations governing the administration, underwriting, marketing, solicitation or sale of insurance products. The Company’s third party insurance carriers are required to apply for, renew, and maintain licenses issued by state, federal or foreign regulatory authorities. Such regulatory authorities have relatively broad discretion to grant, renew and revoke such licenses. Accordingly, any failure by such parties to comply with the then current licensing requirements, which may include any determination of financial instability by such regulatory authorities, could result in such regulatory authorities denying third party insurance carriers’ initial or renewal applications for such licenses, modifying the terms of licenses or revoking licenses that they currently possess, which could severely inhibit the Company’s ability to market these insurance products. Additionally, certain state laws and regulations govern the form and content of certain disclosures that must be made in connection with the sale, advertising or offer of any insurance program to a consumer. The Company reviews all marketing materials it disseminates to the public for compliance with applicable insurance regulations. The Company is required to maintain certain licenses and approvals in order to market insurance products.
The Company has instituted various comprehensive policies and procedures to address compliance. However, there can be no assurance that employees, contractors, vendors or the Company’s agents will not violate such laws and regulations or the Company’s policies and procedures.
Regulations applicable to the sale of extended service contracts could materially impact the Company’s business and results of operations.
The Company offers extended service contracts that may be purchased as a supplement to the original purchaser’s warranty as well as other optional products to protect the consumer’s investment. These products are subject to complex federal and state laws and regulations. There can be no assurance that regulatory authorities in the jurisdictions in which these products are offered will not seek to further regulate or restrict these products. Failure to comply with applicable laws and regulations could result in fines or other penalties including orders by state regulators to discontinue sales of the warranty products in one or more jurisdictions. Such a result could materially and adversely affect the Company’s business, results of operations and financial condition.
Third parties bear the majority of the administration and liability obligations associated with these extended service contracts upon purchase by the customer. State laws and regulations, however, may limit or condition the Company’s ability to transfer these administration and liability obligations to third parties, which could in turn impact the way revenue is recognized from these products. Failure to comply with these laws could result in fines or other penalties, including orders by state regulators to discontinue sales of these product offerings as currently structured. Such a result could materially and adversely affect the Company’s business, financial condition and results of operations.
If state dealer laws are repealed or weakened, the Company’s dealerships will be more susceptible to termination, non-renewal or renegotiation of dealer agreements.
State dealer laws generally provide that a manufacturer may not terminate or refuse to renew a dealer agreement unless it has first provided the dealer with written notice setting forth good cause and stating the grounds for termination or non-renewal. Some state dealer laws allow dealers to file protests or petitions or attempt to comply with the manufacturer’s criteria within a specified notice period to avoid the termination or non-renewal. Manufacturers have been lobbying and continue to lobby for the repeal or revision of state dealer laws. If dealer laws are repealed in the states in which the Company operates, or manufacturers convince legislators to pass legislation in those states allowing termination or non-renewal of dealerships without cause, manufacturers may be able to terminate the Company’s dealer agreements without providing advance notice, an opportunity to cure or a showing of good cause. Without the protection of state dealer laws, it may also be more difficult for the Company to renew its dealer agreements upon expiration.
The ability of a manufacturer to grant additional dealer agreements is based on a number of factors which the Company cannot control. If manufacturers grant new dealer agreements in areas near the Company’s existing markets, such new dealer agreements could have a material adverse effect on the Company’s business, financial condition and results of operations.
The Company failing to comply with certain environmental regulations or changing regulations could adversely affect the Company’s business, financial condition and results of operations.
The Company’s operations involve the use, handling, storage and contracting for recycling and/or disposal of materials such as motor oil and filters, transmission fluids, antifreeze, refrigerants, paints, thinners, batteries, cleaning products, lubricants, degreasing agents, tires and propane. Consequently, the Company’s business is subject to federal, state and local requirements that regulate the environment and public health and safety. The Company may incur significant costs to comply with such requirements. The Company’s failure to comply with these regulations and requirements could cause the Company to become subject to fines and penalties or otherwise have an adverse impact on the Company’s business. In addition, the Company has indemnified certain of its landlords for any hazardous waste which may be found on or about property the Company leases. If any such hazardous waste were to be found on property that the Company occupies, a significant claim giving rise to the Company’s indemnity obligation could have a negative effect on the Company’s business, financial condition and results of operations.
Climate change legislation or regulations restricting emission of “greenhouse gases” could result in increased operating costs and reduced demand for the RVs the Company sells.
The United States Environmental Protection Agency has adopted rules under existing provisions of the federal Clean Air Act that require a reduction in emissions of greenhouse gases from motor vehicles. There are clear indications that the new Administration will refocus attention on greenhouse gases and climate change. The adoption of any laws or regulations requiring significant increases in fuel economy requirements or new federal or state restrictions on vehicles and automotive fuels in the United States could adversely affect demand for those vehicles and could have a material adverse effect on the Company’s business, financial condition and results of operations.
The Company may be unable to enforce its intellectual property rights and/or the Company may be accused of infringing the intellectual property rights of third parties which could have a material adverse effect on the Company’s business, financial condition and results of operations.
The Company owns a variety of registered trademarks and service marks. The Company believes that its trademarks have significant value and are important to its marketing efforts. If the Company is unable to continue to protect the trademarks and service marks for its proprietary brands, if such marks become generic or if third parties adopt marks similar to the Company’s marks, the Company’s ability to differentiate its products and services may be diminished. In the event that the Company’s trademarks or service marks are successfully challenged by third parties, the Company could lose brand recognition and be forced to devote additional resources to advertising and marketing new brands for its products.
From time to time, the Company may be compelled to protect its intellectual property, which may involve litigation. Such litigation may be time-consuming, expensive and distract the Company’s management from running the day-to-day operations of its business, and could result in the impairment or loss of the involved intellectual property. There is no guarantee that the steps the Company takes to protect its intellectual property, including litigation when necessary, will be successful. The loss or reduction of any of the Company’s significant intellectual property rights could diminish the Company’s ability to distinguish its products and services from competitors’ products and services and retain its market share for its proprietary products and services. The Company’s inability to effectively protect the Company’s proprietary intellectual property rights could have a material adverse effect on the Company’s business, results of operations and financial condition.
Other parties also may claim that the Company infringes on their proprietary rights. Such claims, whether or not meritorious, may result in the expenditure of significant financial and managerial resources, injunctions against the Company or the payment of damages. These claims could have a material adverse effect on the Company’s business, financial condition and results of operations.
If the Company is unable to protect, maintain or upgrade its information technology systems or if the Company is unable to convert to alternate systems in an efficient and timely manner, the Company’s operations may be disrupted or become less efficient.
The Company depends on a variety of information technology systems for the efficient operation of its business. The Company relies on hardware, telecommunications and software vendors to maintain and periodically upgrade many of these information technology systems so that the Company can continue to operate its business. Various components of the Company’s information technology systems, including hardware, networks, and software, are licensed to the Company by third party vendors. The Company relies extensively on its information technology systems to process transactions, summarize results and efficiently manage its business. Additionally, because the Company accepts debit and credit cards for payment, the Company is subject to the Payment Card Industry Data Security Standard (the “PCI Standard”), issued by the PCI Standard’s Council. The PCI Standard contains various compliance guidelines with respect to the Company’s security surrounding the physical and electronic storage, processing and transmission of cardholder data. The Company is currently in compliance with the PCI Standard, however, complying with the PCI Standard and implementing related procedures, technology and information security measures requires significant resources and ongoing attention to compliance. Costs and potential problems and interruptions associated with the implementation of new or upgraded systems and technology such as those necessary to maintain compliance with the PCI Standard or with respect to maintenance or support of existing systems could also disrupt or reduce the efficiency of the Company’s operations. Any material interruptions or failures in the Company’s payment-related systems could have a material adverse effect on the Company’s business, financial condition and results of operations.
Any disruptions to the Company’s information technology systems or breaches of the Company’s network security could interrupt its operations, compromise its reputation, compromise its data, expose it to litigation, government enforcement actions and costly response measures and could have a material adverse effect on the Company’s business, financial condition and results of operations.
The Company relies on the integrity, security and successful functioning of its information technology systems and network infrastructure across the Company’s operations. The Company uses information technology systems to, among other things, support its consumer services and plans, manage procurement, manage its supply chain, track inventory information at its retail locations, communicate customer information and aggregate daily sales, margin and promotional information. The Company also uses information systems to report and audit its operational results.
In connection with sales, the Company transmits encrypted confidential credit and debit card information. Although the Company is currently in compliance with the PCI Standard, there can be no assurance that in the future the Company will be able to remain compliant with the PCI Standard or other industry recommended or contractually required practices. Even if the Company continues to be compliant with such standards, it still may not be able to prevent security breaches.
The Company also has access to, collects or maintains private or confidential information regarding its customers, associates and suppliers, as well as the Company’s business. The protection of the Company’s customer, associate, supplier and company data is critical to the Company. The regulatory environment surrounding information security and privacy is increasingly demanding, with the frequent imposition of new and constantly changing requirements across the Company’s business and operations. In addition, the Company’s customers have a high expectation that the Company will adequately protect their personal information from cyber-attacks and other security breaches. The Company has procedures in place to safeguard its customer’s data and information. However, a significant breach of customer, employee, supplier, or company data could attract a substantial amount of negative media attention, damage the Company’s relationships with its customers and suppliers, harm the Company’s reputation and result in lost sales, fines and/or lawsuits.
An increasingly significant portion of the Company’s sales depends on the continuing operation of its information technology and communications systems, including but not limited to its point-of-sale system and its credit card processing systems. The Company’s information technology, communication systems and electronic data may be vulnerable to damage or interruption from earthquakes, acts of war or terrorist attacks, floods, fires, tornadoes, hurricanes, power loss and outages, computer and telecommunications failures, computer viruses, loss of data, unauthorized data breaches, usage errors by the Company’s associates or the Company’s contractors or other attempts to harm the Company’s systems, including cyber-security attacks, hacking by third parties, computer viruses or other breaches of cardholder data. Some of the Company’s information technology and communication systems are not fully redundant and the Company’s disaster recovery planning cannot account for all eventualities. The occurrence of a natural disaster, intentional sabotage or other unanticipated problems could result in lengthy interruptions in the Company’s information technology and communications systems. Any errors or vulnerabilities in the Company’s information technology and communications systems, or damage to or failure of its information technology and communications systems, could result in interruptions in the Company’s services and non-compliance with certain regulations or expose the Company to risk of litigation and liability, which could have a material adverse effect on the Company’s business, financial condition and results of operations.
The Company may be subject to liability claims if people or property are harmed by the products the Company sells and services and may be adversely impacted by manufacturer safety recalls.
Some of the products the Company sells may expose the Company to product liability claims relating to personal injury, death, or environmental or property damage, and may require product recalls or other actions. Although the Company maintains liability insurance, the Company cannot be certain that its insurance coverage will be adequate for losses actually incurred or that insurance will continue to be available to the Company on economically reasonable terms, or at all. In addition, some of the Company’s agreements with its vendors and sellers do not indemnify the Company from losses attributable to product liability. In addition, even if a product liability claim is not successful or is not fully pursued, the negative publicity surrounding a product recall or any assertion that the products sold by the Company caused property damage or personal injury could damage the Company’s brand image and its reputation with existing and potential consumers and have a material adverse effect on the Company’s business, financial condition and results of operations.
The Company’s risk management policies and procedures may not be fully effective in achieving their purposes.
The Company’s policies, procedures, controls and oversight to monitor and manage its enterprise risks may not be fully effective in achieving their purpose and may leave the Company exposed to identified or unidentified risks. Past or future misconduct by the Company’s employees or vendors could result in violations of law by the Company, regulatory sanctions and/or serious reputational or financial harm to the Company. The Company monitors its policies, procedures and controls; however, there can be no assurance that these will be sufficient to prevent all forms of misconduct. The Company reviews its compensation policies and practices as part of the Company’s overall enterprise risk management program, but it is possible that its compensation policies could incentivize inappropriate risk taking or misconduct. If such inappropriate risks or misconduct occurs, it is possible that it could have a material adverse effect on the Company’s business, financial condition and results of operations.
The Company could incur asset impairment charges for goodwill, intangible assets or other long-lived assets.
The Company has a significant amount of goodwill, intangible assets and other long-lived assets. At least annually, the Company reviews goodwill, trademarks and tradenames for impairment. Long-lived assets, identifiable intangible assets and goodwill are also reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable from future cash flows. These events or circumstances could include a significant change in the business climate, legal factors, operating performance, competition, sale or disposition of a significant portion of the business or other factors. If the carrying value of a long-lived asset is considered impaired, an impairment charge is recorded for the amount by which the carrying value of the long-lived asset exceeds its fair value. The Company’s determination of future cash flows, future recoverability and fair value of the Company’s long-lived assets includes significant estimates and assumptions. Changes in those estimates and/or assumptions or lower than anticipated future financial performance may result in the identification of an impaired asset and a non-cash impairment charge, which could be material. Any such charge could adversely affect the Company.
The fair value of warrant liabilities may fluctuate.
The Company accounts for the Private Warrants and PIPE Warrants as liabilities for all periods presented. Prior to the SEC Staff Statement on April 12, 2021, the Company had previously accounted for its warrants as components of equity, consistent with common market practice. Under liability accounting treatment, the Company is required to measure the fair value of the warrants at the end of each reporting period and recognize changes in the fair value from the prior period in the Company’s operating results for the current period. Fluctuations in the fair value of our warrants are primarily driven by changes in our stock price. As a result of this recurring fair value measurement, our financial statements and results of operations may fluctuate quarterly based on factors which are outside our control. We expect that we will periodically recognize non-cash gains or losses due to the quarterly mark-to-market of our warrants and that such gains or losses could be material and may not be reflective of the performance of our underlying business operations.
The Company must be able to maintain an effective system of internal controls and accurately report our financial results and remediate material weaknesses.
Following the issuance of the SEC Staff Statement on April 12, 2021, management of the Company concluded that the Company’s previously issued consolidated financial statements should be restated to conform our accounting for warrants with the SEC Staff Statement. In connection with the restatement, a material weakness in internal control over financial reporting related to the accounting for the warrants was determined to exist. The Company’s management has completed the restatement for warrant accounting and has developed and implemented a remediation plan to address the material weakness. However, given the very infrequent nature of this type of transaction involving warrants, we cannot assure you that the testing of the operational effectiveness of the new control will be complete within a specific timeframe. There can be no assurances that the accounting for warrants and other financial instruments will not change in the future and require restatement of previously accepted accounting positions. Effective internal controls are necessary for us to provide reliable and accurate financial statements and to effectively prevent fraud. We devote significant resources and time to comply with the internal control over financial reporting requirements of the Sarbanes-Oxley Act of 2002 as amended. There is no assurance that material weaknesses or significant deficiencies will not occur or that we will be successful in adequately remediating any such material weaknesses and significant deficiencies. We may in the future discover areas of our internal controls that need improvement. We cannot be certain that we will be successful in maintaining adequate internal control over our financial reporting and financial processes. Furthermore, as we grow our business, including through acquisition, our internal controls will become more complex, and we will require significantly more resources to ensure our internal controls remain effective. Additionally, the existence of any material weakness or significant deficiency would require management to devote significant time and incur significant expense to remediate any such material weaknesses or significant deficiencies, and management may not be able to remediate any such material weaknesses or significant deficiencies in a timely manner. The existence of any material weakness in our internal control over financial reporting could also result in errors in our financial statements that could require us to restate our financial statements, cause us to fail to meet our reporting obligations, subject us to investigations from regulatory authorities or cause stockholders to lose confidence in our reported financial information, all of which could materially and adversely affect us.
Risks Related to Our Capital Stock
Future resalesthe Rights Offering
The Company is party to registration rights agreements pursuant to which certain stockholders have been granted demand and “piggy-back” registration rights with respect to their securities. Additionally, the investors who simultaneously with the closing of the Merger purchased convertible preferred stock, common stock and warrants for an aggregate purchase price of $94.8 million (the “PIPE Investment”) were granted registration rights pursuant to which the Company filed a registration statement covering the resale of granted securities. This resale registration statement is currently effective.
Furthermore, the stockholders and investors in the PIPE Investment may sell Company common stock pursuant to Rule 144 under the Securities Act, if available, rather than under a registration statement. In these cases, the resales must meet the criteria and conform to the requirements of that rule.
Subject to the effectiveness of this resale registration statement or upon satisfaction of the requirements of Rule 144 under the Securities Act, the stockholders and investors in the PIPE Investment may sell large amounts of Company common stock in the open market or in privately negotiated transactions, which could have the effect of increasing the volatility in the Company’s stock price or putting significant downward pressure on the price of the Company’s common stock.
The Company’s outstanding convertible preferred stock, warrants and options may have an adverse effect on the market price of its common stock.
As of September 30, 2021, we had outstanding: (i) stock options issued to the board of directors and employees to purchase 4,012,066 shares of common stock at exercise prices ranging from $5.05 to $23.11 per share; (ii) pre-funded warrants to purchase up to 300,357 shares of common stock that were issued in the PIPE Investment; (iii) warrants to purchase 1,366,629 shares of our common stock at $11.50 per share issued in the PIPE Investment, (iv) warrants to purchase 2,138,200 shares of our common stock at $11.50 per share held by Andina public shareholders; and (v) 600,000 shares of Series A Preferred Stock which are convertible into up to 5,962,733 shares of common stock, taking into account any accrued dividends which we may elect to pay in cash or shares of common stock. We may also issue additional equity awards under our Amended and Restated 2018 Long-Term Incentive Plan (the “Amended 2018 Plan”).
The sale, or even the possibility of sale, of the shares of common stock underlying the warrants, stock options and Series A Preferred Stock and the shares issuable under the Amended 2018 Plan could have an adverse effect on the market price of the common stock or on our ability to obtain future financing. If and to the extent these warrants and stock options are exercised or the Series A Preferred Stock is converted to common stock, you may experience substantial dilution to your holdings.
The conversion of the Series A Preferred Stock into Company common stock may dilute the value for the other holders of Company common stock.
The Series A Preferred Stock is convertible into Company common stock. As a result of the conversion of any issued and outstanding Series A Preferred Stock, the existing holders of Company common stock will own a smaller percentage of the outstanding Company common stock. Further, additional Company common stock may be issuable pursuant to certain other features of the Series A Preferred Stock, with such issuances being further dilutive to existing holders of Company common stock.
If the Series A Preferred Stock is converted into Company common stock, holders of such converted Company common stock will be entitled to the same dividend and distribution rights as other holders of Company common stock. As such, another dilutive effect which may result from the conversion of any shares of Series A Preferred Stock will be a dilution to dividends and distributions receivable on account of Company common stock.
The holders of Series A Preferred Stock own a large portion of the voting power of the Company common stock and have the right to nominate two members to the Company’s board of directors (the “Board”). As a result, these holders may influence the composition of the Board and future actions taken by the Board.
The Company’s board of directors currently has seven members. The holders of the Series A Preferred Stock are exclusively entitled to designate two members to the Company’s board of directors. In addition, the holders of the Series A Preferred Stock are entitled to vote upon all matters upon whichparticipate in the Rights Offering and, although such holders have waived certain anti-dilution adjustments in connection with the Rights Offering, there can be no assurance that they will do so in the future and such anti-dilution adjustments could cause dilution to our stockholders.
| | As of June 30, 2023 (Unaudited) | ||||
| | Actual | | | Pro Forma | |
| | (Dollars in thousands) | ||||
Cash | | | $24,173 | | | $124,173 |
Total current assets | | | 454,636 | | | 554,636 |
Total liabilities | | | 530,773 | | | 530,773 |
Series A convertible preferred stock; 600,000 shares, designated, issued, and outstanding; liquidation preference of $60,000 | | | 54,983 | | | 54,983 |
Stockholders’ Equity | | | | | ||
Preferred Stock, $0.0001 par value; 5,000,000 shares authorized | | | — | | | — |
Common Stock, $0.0001 par value; 100,000,000 shares authorized; 17,328,483 shares issued and 13,916,261 shares outstanding | | | — | | | — |
Additional paid-in capital | | | 162,211 | | | 262,211 |
Treasury Stock, at cost, 3,412,222 shares | | | (57,128) | | | (57,128) |
Retained earnings | | | 166,487 | | | 166,487 |
Total stockholders’ equity | | | $271,570 | | | $371,570 |
Total Capitalization | | | $768,717 | | | $868,717 |
Subscription price | | | | | $100,000,000 | |
Net tangible book value per share as of June 30, 2023 | | | $11.46 | | | |
Pro forma net tangible book value per share as of June 30, 2023 | | | 8.63 | | | |
Increase in pro forma net tangible book value per share | | | (2.83) | | | |
Dilution in net tangible book value per share to stockholders participating in this offering | | | | | — |
Pursuant to the Certificatepay in cash or shares of Designations governing the Series A PreferredCommon Stock;
Additionally, Blackwell Partners LLC – Series A and Coliseum Capital Partners, L.P. have been granted a right of first refusal on certain debt financings. Pursuant to this right, these holders have 15 business days to determine whether they want to undertake a covered debt financing. This may delay the Company’s ability to undertake a debt financing and may cause certain third parties to be less willing to engage in any debt financing with the Company. As a shareholder, Series A Preferred shareholders could negatively impact your investment and may not take actions that will be in your best interest.
The Company’s stock repurchase program could increase the volatility of theweighted average exercise price of $10.82 per share.
extent that outstanding options are exercised or restricted stock units vest and are settled, the investors purchasing our Common Stock in this Rights Offering will experience further dilution. In November 2019, our board of directors approved a stock repurchase program authorizing usaddition, we may choose to repurchase up to a maximum of $4.0 million of our shares of common stock through December 31, 2020, which expired on that date. On September 10, 2021 our board of directors approved a stock repurchase program authorizing us to repurchase up to a maximum of $25.0 million of our shares of common stock through December 31, 2022. Repurchases may be made from time to time pursuant to a trading plan subjectraise additional capital due to market conditions applicable legal requirements and other factors. There can be no assuranceor strategic considerations. To the extent that we would buy shares of our common stock or the timeframe for repurchases under our stock repurchase program or that any repurchases would have a positive impact on our stock price or earnings per share.
The Company’s amended and restated certificate of incorporation provides to the fullest extent permitted by law that the Court of Chancery of the State of Delaware will be the exclusive forum for certain legal actions between the Company and its stockholders, which could limit the Company’s stockholders’ ability to obtain a judicial forum viewed by the stockholders as more favorable for disputes with the Company or the Company’s directors, officers or employees.
The Company’s amended and restated certificate of incorporation provides to the fullest extent permitted by law that unless the Company consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for any derivative action or proceeding brought on behalf of the Company, any action asserting a claim of breach of a fiduciary duty owed by any of the Company’s directors, officers or other employees to the Company or the Company’s stockholders, any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law (“DGCL”), or any action asserting a claim governed by the internal affairs doctrine. The choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with the Company or the Company’s directors, officers or other employees, which may discourage such lawsuits against the Company or the Company’s directors, officers and other employees. Alternatively, if a court were to find the choice of forum provision contained in the Company’s amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, the Company may incur additional costs associated with resolving such action in other jurisdictions. The exclusive forum provision in the Company’s amended and restated certificate of incorporation does not apply to actions arising under the federal securities laws and will not preclude or contract the scope of exclusive federal or concurrent jurisdiction for actions brought under the federal securities laws including the Exchange Act, or the Securities Act, or the respective rules and regulations promulgated thereunder.
We are not selling any securities under this prospectus and we will not receive any proceeds fromcapital is raised through the sale of securities, by the Selling Securityholders, although we could receive up to $39,322,769 upon the exercise of all of the warrants. Any amounts we receive from such exercises will be used for working capital and other general corporate purposes. The holders of the warrants are not currently obligated to exercise the warrants and we cannot assure you that the holders of the warrants will choose to exercise all or any of the warrants.
The Selling Securityholders may from time to time offer and sell any or all of our securities set forth below pursuant to this prospectus. When we refer to “Selling Securityholders” in this prospectus, we mean the persons listed in the table below, and the pledgees, donees, permitted transferees, assignees, successors and others who later come to hold any of the Selling Securityholders’ interests in our securities other than through a public sale.
The following table sets forth, as of the date of this prospectus:
This table is prepared solely based on information supplied to us by the listed Selling Securityholders, the transfer agent, any Schedules 13D or 13G and other public documents filed with the SEC and assumes the sale of all of the shares of common stock, Series A Preferred Stock and warrants offered hereby.
Owned Prior to the Offering | Stock Owned After Offering | |||||||||||||||||||||||||||||||||||||||||||||||||||
Common Stock | Preferred Stock | Common Stock | Preferred Stock | |||||||||||||||||||||||||||||||||||||||||||||||||
Selling Securityholder1 | Shares Owned | Percentage of Shares Owned2 | Shares Owned | Percentage of Shares Owned2 | Common Stock Being Offered | Preferred Stock Being Offered | Common Stock Underlying Preferred Stock Being Offered | Warrants Being Offered3 | Common Stock Underlying Warrants Being Offered | Shares Owned | Percentage of Shares Owned2 | Shares Owned | Percentage of Shares Owned | |||||||||||||||||||||||||||||||||||||||
Charles McIntyre Webster, Jr. Revocable Trust Dtd 12/10/034 | 210,537 | 4 | 1.7 | % | - | - | 210,537 | - | - | - | - | 0 | 0 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||||||
Cobb Nevada Partners Limited Partnership Its General Partner CP Operations Inc.5 | 17,143 | 5 | * | - | - | 11,429 | - | - | 5,714 | 5,714 | 0 | 0 | % | 0 | 0 | % | ||||||||||||||||||||||||||||||||||||
Dane Capital Management LLC6 | 42,857 | 6 | * | - | - | 28,571 | - | - | 14,286 | 14,286 | 0 | 0 | % | 0 | 0 | % | ||||||||||||||||||||||||||||||||||||
KBB Asset Management7 | 34,286 | * | - | - | 34,286 | - | - | - | - | 0 | 0 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||||||||
MAZ Partners LP8 | 22,500 | 8 | * | - | - | 15,000 | - | - | 7,500 | 7,500 | 0 | 0 | % | 0 | 0 | % | ||||||||||||||||||||||||||||||||||||
Patriot Strategy Partners LLC9 | 85,713 | 9 | * | - | - | 57,142 | - | - | 28,571 | 28,571 | 0 | 0 | % | 0 | 0 | % | ||||||||||||||||||||||||||||||||||||
Pinnacle Family Office Investments, L.P.10 | 172,000 | * | - | - | 172,000 | - | - | - | - | 0 | 0 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||||||||
Park West Investors Master Fund, Limited11 | 1,861,348 | 11 | 15.0 | % | 88,954 | 14.8 | % | 10,463 | 11 | 88,954 | 884,015 | 863,319 | 863,319 | 818,811 | 0 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||||
Park West Partners International Limited12 | 207,193 | 12 | 1.7 | % | 11,046 | 1.8 | % | 1,299 | 12 | 11,046 | 109,774 | 107,845 | 107,845 | 81,289 | 0 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||||
Saker Partners LP13 | 85,714 | * | - | - | 85,714 | - | - | - | - | 0 | 0 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||||||||
Blackwell Partners LLC - Series A14 | 353,016 | 14 | 2.8 | % | 134,489 | 22.4 | % | 15,819 | 14 | 134,489 | 1,336,537 | 14 | 133,653 | 133,653 | 203,554 | 14 | 2.1 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||
Coliseum Capital Partners, L.P.15 | 1,032,747 | 15 | 8.3 | % | 365,511 | 60.9 | % | 42,992 | 15 | 365,511 | 3,632,407 | 15 | 363,241 | 363,241 | 626,514 | 15 | 5.7 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||
Common Pension Fund D16 | 731,627 | 6.1 | % | - | - | 731,627 | - | - | - | - | 0 | 0 | % | 0 | 0 | % | ||||||||||||||||||||||||||||||||||||
William P. Murnane17 | 311,810 | 17 | 2.6 | % | - | - | 254,667 | - | - | 57,143 | 57,143 | 0 | 0 | 0 | 0 | % | ||||||||||||||||||||||||||||||||||||
B Luke Weil18 | 2,092 | * | - | - | 2,092 | - | - | - | - | 0 | 0 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||||||||
LWEH2-LLC19 | 9,000 | * | - | - | 9,000 | - | - | - | - | 0 | 0 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||||||||
Mauricio Orellana20 | 7,990 | * | - | - | 4,490 | - | - | 7,000 | 3,500 | 0 | 0 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||||||||
Marjorie Hernandez21 | 19,542 | 21 | * | - | - | 9,542 | - | - | 20,000 | 10,000 | 0 | 0 | % | 0 | 0 | % | ||||||||||||||||||||||||||||||||||||
Ryan Chang | - | - | - | - | - | - | - | 20,000 | 10,000 | 0 | 0 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||||||||
Whitney Cox | - | - | - | - | - | - | - | 2,500 | 1,250 | 0 | 0 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||||||||
Eric Carrera22 | 7,235 | * | - | - | 7,000 | - | - | - | - | 0 | 0 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||||||||
Edward Navarro | 3,293 | * | - | - | 3,293 | - | - | - | - | 0 | 0 | % | 0 | 0 | % | |||||||||||||||||||||||||||||||||||||
Eileen Moore23 | 8,214 | 23 | * | - | - | 5,714 | - | - | 5,000 | 2,500 | 0 | 0 | % | 0 | 0 | % |
* Less than 1%.
Each of the Selling Securityholders that is a broker-dealer or an affiliate of a broker-dealer has represented to us that it purchased the securities offered by this prospectus in the ordinary course of business and, at the time of purchaseissuance of those securities did not have any agreements, understandings or other plans, directly or indirectly, with any personcould result in further dilution to distribute those shares.
our stockholders.
Currently, our shares of common stock areSTOCK
Record
may be held in trust or by other entities.
Certain statements
Each Selling Securityholderenough shares to satisfy all subscriptions made under the Over-Subscription Right, we will allocate the remaining shares pro rata, after eliminating all fractional shares, among those oversubscribing Holders. If there is a pro rata allocation of the securitiesremaining shares and anyyou receive an allocation of a greater number of shares than you subscribed for under your Over-Subscription Right, then we will allocate to you only the number of shares for which you subscribed. We will allocate the remaining shares among all other holders exercising their pledgees, assigneesOver-Subscription Rights.
In addition, a Selling Securityholdershares for which you wished to subscribe, your excess payment for shares that is an entity may electwere not allocated to make ayou will be returned, without interest or deduction, as soon as practicable after the expiration date. We will deliver or cause the transfer agent to deliver shares that you purchased as soon as practicable after the expiration date and after all pro rata in-kind distributionallocations and adjustments have been completed.
By Mail: Broadridge Corporate Issuer Solutions, LLC Attn: BCIS Re-Organization Dept. P.O. Box 1317 Brentwood, NY 11717-0718 | | | By Overnight Delivery: Broadridge Corporate Issuer Solutions, LLC Attn: BCIS IWS 51 Mercedes Way Edgewood, NY 11717 |
The Selling Securityholders may also sell securities under Rule 144 or any other exemption from registration underforms, the Securities Act, if available, rather than under this prospectus.
Broker dealers engagedSubscription Agent will have the right to reject and return your subscription for correction. Any excess subscription payments received by the Selling Securityholders may arrangeSubscription Agent will be returned, without interest or penalty, as soon as practicable following the expiration of the Rights Offering.
In order to comply with the securities lawslaw requirements of certainthose states if applicable,or other jurisdictions. We do not anticipate that there will be any changes in the securities must be soldRights Offering, and we may, in suchour sole discretion, decline to make modifications to the terms of the Rights Offering requested by regulators in states or other jurisdictions, only through registeredin which case stockholders who live in those states or licensed brokers or dealers. In addition, in certain states the securities mayother jurisdictions will not be sold unless they have been registered or qualified for saleeligible to participate in the applicable state or an exemption fromRights Offering.
In connection with the sale14,019,383 shares of the securities or interests therein, the Selling Securityholders may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short salesCommon Stock outstanding, 600,000 shares of the securities in the course of hedging the positions they assume. The Selling Securityholders may also sell securities short and deliver these securities to close out their short positions, or loan or pledge the securities to broker-dealers that in turn may sell these securities. The Selling Securityholders may also enter into option or other transactions with broker-dealers or other financial institutions or create one or more derivative securities which require the delivery to such broker-dealer or other financial institution of securities offered by this prospectus, which securities such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).
The Selling Securityholders and any broker-dealers or agents that are involved in selling the securities may be deemed to be “underwriters” within the meaning of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the securities purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act. Each Selling Securityholder has informed the Company that it does not have any written or oral agreement or understanding, directly or indirectly, with any person to distribute the securities.
The Company is required to pay certain fees and expenses incurred by the Company incident to the registration of the securities, including all underwriting commissions, broker fees or similar fees that may be incurred by certain Selling Securityholders who hold both preferred shares and warrants. The Company has agreed to indemnify the Selling Securityholders against certain losses, claims, damages and liabilities, including liabilities under the Securities Act.
The resale securities will be sold only through registered or licensed brokers or dealers if required under applicable state securities laws. In addition, in certain states, the resale securities covered hereby may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with.
We will make copies of this prospectus available to the Selling Securityholders for the purpose of satisfying the prospectus delivery requirements of the Securities Act. The Selling Securityholders may indemnify any agent, broker-dealer or underwriter that participates in transactions involving the sale of the securities against certain liabilities, including liabilities arising under the Securities Act.
Under applicable rules and regulations under the Exchange Act, any person engaged in the distribution of the resale securities may not simultaneously engage in market making activities with respect to the common stock for the applicable restricted period, as defined in Regulation M, prior to the commencement of the distribution. In addition, the Selling Securityholders will be subject to applicable provisions of the Exchange Act and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of the common stock by the Selling Securityholders or any other person. We will make copies of this prospectus available to the Selling Securityholders and have informed them of the need to deliver a copy of this prospectus to each purchaser at or prior to the time of the sale (including by compliance with Rule 172 under the Securities Act).
DETERMINATION OF OFFERING PRICE OF PREFERRED STOCK
The various factors considered in determining the conversion price of the Series A Preferred Stock in 2017 wereissued and outstanding and 300,357 Warrants issued and outstanding.
OUR CAPITAL STOCK Common Stock.SECURITIES TO BE REGISTEREDAs of the date of this prospectus, we had one class of securities registered under Section 12 of the Exchange Act, our common stock.common stockCommon Stock and preferred stock as set forth in our Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”), our Bylaws (the “Bylaws”), and our Certificate of Designations of Series A Preferred Stock (the “Certificate of Designation”), which govern the rights of our common stockCommon Stock and preferred stock. This description is only a summary. You should read it together with the Certificate of Incorporation, Bylaws, and Certificate of Designation, which are included as exhibits to this Registration Statementthe Company’s Annual Report on Form S-110-K for the year ended December 31, 2022 and incorporated by reference herein.common stock,Common Stock, par value $0.0001 per share, and 5,000,000 shares of preferred stock, par value $0.0001 per share. As of November 22, 2021,October 23, 2023, we had 12,410,34714,019,383 shares of common stockCommon Stock outstanding and 600,000 shares of Series A Preferred Stock outstanding.common stockCommon Stock are entitled to one vote for each share held of record on all matters to be voted on by stockholders. There is no cumulative voting with respect to the election of directors, with the result that the holders of more than 50% of our shares voted for the election of directors can elect all of the directors.common stockCommon Stock do not have any conversion, preemptive or other subscription rights and there are no sinking fund or redemption provisions applicable to our common stock.common stockCommon Stock and do not plan to pay any cash dividends on our common stockCommon Stock in the foreseeable future. Our Board will determine our future dividend policy on the basis of many factors, including results of operations, capital requirements, and general business conditions, subject to any restrictions under our credit facility and the Certificate of Designations for the Series A Preferred Stock.seveneight (8) directors who are divided into three classes including two (2) directors designated by the holders of the Series A Preferred Stock. Directors in each class serve a three-year term. The terms of each class expire at successive annual meetings so that the stockholders elect one class of directors at each annual meeting. The current classification of our Board is: (i) Class A – has two (2) directors with a term expiring at the 20222025 annual meeting of stockholders; (ii) Class B – has twothree (3) directors with a term expiring at the 20232026 annual meeting of stockholders; and (iii) Class C – has three (3) directors with a term expiring at the 2024 annual meeting of stockholders.
Common Stock.
Warrants
As of November 22, 2021, 5,857,652 warrants are outstanding. The description that follows is of the public warrants, pre-funded warrants and private warrants covered by this registration statement. The warrants became exercisable on March 15, 2018 (the date of the consummation of our initial business combination). The warrants have an exercise price of $11.50 except for the pre-funded warrants that have an exercise price of $0.01 and the private warrants that are exercisable as follows: each warrant is exercisable into one-half share of common stock or two warrants are exercisable into one share of common stock at a price of $11.50 per share of common stock. The exercise price of the warrants (except for the pre-funded warrants) was set at $11.50 consistent with the exercise price of the private warrants that preceded the warrants issued in the PIPE offering. The exercise price of the pre-funded warrants was set at $0.01 because the PIPE investors paid $8.74 out of the full $8.75 exercise price at the time of subscribing for their investment. The pre-funded warrants were valued differently and had a different exercise price because the holders electing to receive pre-funded warrants received them because they elected to be subject to a beneficial ownership limitation such that an electing warrant holder would not be able to exercise their warrants to the extent that, after giving effect to such exercise, such holder would beneficially own in excess of 9.99% of the shares of our common stock then outstanding.
Warrants may be exercised for cash or, at the option of the holder, on a “cashless basis” pursuant to the exemption provided by Section 3(a)(9) of the Securities Act by surrendering the warrants for that number of shares of common stock as determined under the warrants. The warrants covered by this registration statement expire March 15, 2023 (five years following the date of consummation of our initial business combination) at 5:00 p.m., New York City time, except for the pre-funded warrants that do not have an expiration date.
We may call the warrants for redemption (excluding the pre-funded warrants and any private warrants no longer held by the initial purchaser) in whole and not in part, at a price of $0.01 per warrant,
The right to exercise will be forfeited unless the warrants are exercised prior to the date specified in the notice of redemption. On and after the redemption date, a record holder of a warrant will have no further rights except to receive the redemption price for such holder’s warrant upon surrender of such warrant.
The exercise price and number of shares of our common stock issuable on exercise of the warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or our recapitalization, reorganization, merger or consolidation. However, the warrants will not be adjusted for issuances of shares of our common stock at a price below their respective exercise prices.
The warrants may be exercised upon surrender of the warrant certificate on or prior to the expiration date at the offices of the warrant agent, with the exercise form on the reverse side of the warrant certificate completed and executed as indicated, accompanied by full payment of the exercise price, by certified or official bank check payable to us, for the number of warrants being exercised. The warrant holders do not have the rights or privileges of holders of shares of our common stock or any voting rights unless and until they exercise their warrants and receive shares of our common stock. After the issuance of shares of our common stock upon exercise of the warrants, each holder will be entitled to one vote for each share of our common stock held of record on all matters to be voted on by stockholders.
No fractional shares of or common stock will be issued upon exercise of the warrants. If, upon exercise of the warrants, a holder would be entitled to receive a fractional interest in a share of the Company, the Company will, upon exercise, follow the requirements of the DGCL.
Our warrants are quoted on the OTC Pink marketplace under the symbol “LAZYW”.
Contractual Arrangements
intend to apply for listing or quotation of our Series A Preferred Stock on any exchange or marketplace in the future.
By Mail: Broadridge Corporate Issuer Solutions, LLC Attn: BCIS Re-Organization Dept. P.O. Box 1317 Brentwood, NY 11717-0718 | | | By Overnight Delivery: Broadridge Corporate Issuer Solutions, LLC. Attn: BCIS IWS 51 Mercedes Way Edgewood, NY 11717 |
Name of Beneficial Owners | | | Amount and Nature of Beneficial Ownership (Common Stock) | | | Percent of Class(1) | | | Amount and Nature of Beneficial Ownership (Series A Preferred Stock)(2) | | | Percent of Class(3) | | | Percent of Total Voting Power(4) |
Directors and Named Executive Officers | | | | | | | | | | | |||||
John North | | | 35,103 | | | * | | | — | | | — | | | — |
Kelly Porter | | | 18,588 | | | * | | | — | | | — | | | — |
Robert DeVincenzi | | | 80,708(5) | | | * | | | — | | | — | | | — |
Jerry Comstock | | | 51,173(6) | | | * | | | — | | | — | | | * |
James J. Fredlake | | | 61,335(7) | | | * | | | — | | | — | | | * |
Jordan Gnat | | | 41,955(8) | | | * | | | — | | | — | | | * |
Erika Serow | | | 46,943(9) | | | * | | | — | | | — | | | * |
Christopher S. Shackelton | | | 11,280,876(10) | | | 59.0% | | | 500,000(11) | | | 83.3% | | | 56.2% |
All directors and executive officers as a group (8 persons) | | | 11,616,681(12) | | | 60.4% | | | 500,000 | | | 83.3% | | | 57.4% |
| | | | | | | | | | ||||||
5% or Greater Securityholders | | | | | | | | | | | |||||
Coliseum Capital Management, LLC. | | | 11,280,876(10) | | | 59.0% | | | 500,000(11) | | | 83.3% | | | 56.2% |
Park West Asset Management LLC | | | 1,400,536(13) | | | 9.99% | | | 100,000(13) | | | 16.7% | | | 7.0% |
Divisadero Street Capital Management, LP | | | 722,357(14) | | | 5.15% | | | — | | | — | | | 3.6% |
Cannell Capital, LLC | | | 1,092,399(15) | | | 7.8% | | | — | | | — | | | 5.4% |
* | Less than 1 percent |
(1) | For purposes of this column, the number of shares of the class outstanding reflects the sum of: (i) 14,019,383 shares of Common Stock that were outstanding as of September 19, 2023; and (ii) the number of shares of Common Stock, if any, which the relevant person could acquire on exercise of options, warrants, pre-funded warrants or conversion of the preferred stock within 60 days of September 19, 2023. |
(2) | This column includes the number of shares of preferred stock. The number of shares of Common Stock that could be obtained upon the conversion of preferred stock at the current conversion rate is included in the column entitled “Amount and Nature of Beneficial Ownership (Common Stock).” |
(3) | Certain purchasers of the preferred stock are entitled to vote upon all matters upon which holders of Common Stock have the right to vote and are entitled to the number of votes equal to the number of full shares of Common Stock into which such shares of preferred stock could be converted at the then applicable conversion rate. |
(4) | The Percent of Total Voting Power is calculated by dividing: (A) the aggregate number of shares of Common Stock beneficially owned under Rule 13d-3 of the Exchange Act by the relevant person, including all shares of Common Stock issuable upon conversion of preferred stock, subject to the beneficial ownership limitations contained therein by: (B) the sum of (x) the number of shares of Common Stock issued and outstanding, (y) the number of shares of Common Stock that could be acquired upon the conversion of all shares of preferred stock issued and outstanding, subject to the beneficial ownership limitations contained therein and (z) the number of shares of Common Stock, if any, which the relevant person could acquire on exercise of options or warrants within 60 days of September 19, 2023. |
(5) | Includes 54,631 shares of common Stock issuable upon the exercise of options as follows: 25,032 shares of Common Stock at an exercise price of $30.00 per share and 29,599 shares at an exercise price of $14.55 per share that are or will become exercisable within 60 days of September 19, 2023. |
(6) | Includes 23,436 shares of Common Stock issuable upon the exercise of options as follows: 20,770 shares of Common Stock at an exercise price of $7.91 per share and 2,666 shares at an exercise price of $23.11 per share that are or will become exercisable within 60 days of September 19, 2023. |
(7) | Includes 23,436 shares of Common Stock issuable upon the exercise of options as follows: 20,770 shares of Common Stock at an exercise price of $7.91 per share and 2,666 shares at an exercise price of $23.11 per share that are or will become exercisable within 60 days of September 19, 2023. |
(8) | Includes 33,666 shares of Common Stock issuable upon the exercise of options as follows: 31,000 shares of Common Stock at an exercise price of $7.91 per share and 2,666 shares at an exercise price of $23.11 per share that are or will become exercisable within 60 days of September 19, 2023. |
(9) | Includes 35,000 shares of Common Stock issuable upon the exercise of options as follows: 31,000 shares of Common Stock at an exercise price of $7.91 per share and 4,000 shares at an exercise price of $23.11 per share that are or will become exercisable within 60 days of September 19, 2023. |
(10) | Consists of: (i) 4,968,944 shares of Common Stock that could be obtained upon the conversion of 500,000 shares of preferred stock at the current conversion rate; (ii) the equivalent of 88,216 shares of Common Stock that could be voted as a result of accrued and unpaid Preferred Dividends (as defined in the Certificate of Designations of the preferred stock) at the current conversion rate; (iii) 6,190,050 shares of Common Stock; and (iv) 33,666 shares of Common Stock issuable upon the exercise of options held by Coliseum Capital Partners, L.P. (“CCP”) and granted for Mr. Shackelton’s services on the Board that are or will become exercisable within 60 days of September 19, 2023 as follows: 31,000 shares of Common Stock at an exercise price of $7.91 per share and 2,666 shares of Common Stock at an exercise price of $23.11 per share. |
(11) | Consists of 500,000 shares of preferred stock, of which 365,511 shares of preferred stock are held by CCP and 134,489 shares of preferred stock are held by an investment advisory client of CCM. |
(12) | Includes: (i) 4,968,944 shares of Common Stock that could be obtained upon the conversion of 500,000 shares of preferred stock at the current conversion rate and 88,216 shares of Common Stock that could be voted as a result of accrued and unpaid Preferred Dividends; and (ii) 158,695 shares of Common Stock issuable upon the exercise of options at various exercise prices that are or will become exercisable within 60 days of September 19, 2023. |
(13) | Consists of: (i) Park West Asset Management LLC, a Delaware limited liability company (“PWAM”), (ii) Park West Investors Master Fund, Limited, a Cayman Islands exempted company (“PWIMF”) and (iii) Peter S. Park (“Mr. Park” and, collectively with PWAM and PWIMF, “Park West”). PWAM is the investment manager to PWIMF and Park West Partners International, Limited (“PWPI” and, collectively with PWIMF, the “PW Funds”). Mr. Park is the controlling manager of PWAM. |
(14) | Based on the Schedule 13G filed on May 19, 2023, Divisadero Street Capital Management, LP (“Divisadero”)is the investment adviser to private investment funds, including Divisadero Street Partners, L.P. (“Divisadero Partners”) (collectively, the “Funds”), and Divisadero Street Partners GP, LLC is the general partner of the Funds. Mr. William Zolezzi is the control person of Divisadero and the General Partner. Divisadero, the Funds, the General Partner and Mr. Zolezzi share voting and dispositive power over the securities. The address for Divisadero, the Funds, the General Partner and Mr. Zolezzi is 3350 Virginia Street, 2nd Floor, Miami, Florida 33133 |
(15) | The address for Cannell Capital, LLC is 245 Meriwether Circle, Alta, Wyoming 83414. |
Paul Hastings LLP, New York, New York.
WHERE YOU CAN FIND MORE INFORMATION
We are currently subject to
INCORPORATION BY REFERENCE
The information incorporated by reference is considereddeemed to be a part of this prospectus, andexcept for any later information superseded by information contained directly in this prospectus, any accompanying prospectus supplement, any subsequently filed document deemed incorporated by reference or any free writing prospectus prepared by or on behalf of us. This prospectus incorporates by reference the documents set forth below that we filehave previously filed with the SEC will automatically update(other than information deemed furnished and supersede this information. The documentsnot filed in accordance with SEC rules, including Items 2.02 and other information incorporated by reference are:
• | our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on March 1, 2023; |
• | our Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2023 and June 30, 2023, filed with the SEC on April 28, 2023 and July 28, 2023, respectively; |
• | our Current Reports on Form 8-K, filed with the SEC on January 27, 2023, February 23, 2023 (excluding information under Item 2.02), June 15, 2023, September 1, 2023, September 12, 2023,October 5, 2023 and October 20, 2023; |
• | our definitive proxy statement on Schedule 14A filed with the SEC on May 1, 2023 (solely to the extent incorporated by reference into Part III of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022); and |
• | the description of our Common Stock contained in Exhibit 4.7 to our Annual Report on Form 10-K for the year ended December 31, 2020 | |
Any statement contained in this prospectus or in a document incorporated or deemed to be incorporated by reference in this prospectusand before the termination of the offering also shall be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained in this prospectus or in any other subsequently filed document which also is or is deemed to be incorporated herein by reference. We are not, however, incorporating by reference in this prospectus modifiesany documents or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
Notwithstanding the foregoing, weportions thereof that are not incorporating any document or information that we deemed within a Current Report on Form 8-K or Form 8-K/A to have been furnished and not filed in accordance“filed” with SEC rules. You can obtain any of the documents incorporated by reference in this prospectus from the SEC, through the SEC’s website at the address described above,including any information furnished pursuant to Items 2.02 or at our website at www.lazydays.com. We7.01 of Form 8-K.
following address:
Blvd.
Attn: Investor Relations
You should rely only on
Please note that information contained in our website (www.lazydays.com), whether currently postedrespect to their unsold allotments or posted in the future, is not a part of this prospectus or the documents incorporated by reference in this prospectus.subscriptions.
1,712,912 shares of Common Stock
600,000 shares of Series A Convertible Preferred Stock
1,635,772 Warrants
5,962,733 shares of Common Stock Issuable upon Conversion of the Series A Preferred Stock
1,608,522 shares of Common Stock Issuable upon Exercise of the Warrants
Lazydays Holdings, Inc.
Prospectus
, 2021
Item 13. | Other |
SEC registration fee | $ | 16,644.53 | ||
Legal fees and expenses | $ | * | ||
Accounting fees and expenses | $ | * | ||
Printing and miscellaneous expenses | $ | * | ||
Total | $ | * |
Item | | | Amount |
SEC registration fee | | | $14,760.00 |
Subscription and Information agent fees and expenses | | | $15,000 |
Printing and postage expenses | | | $30,000 |
Legal fees and expenses | | | $350,000 |
Accounting fees and expenses | | | $35,000 |
Miscellaneous fees and expenses | | | $5,000 |
Total | | | $449,760 |
Item 14. | Indemnification of |
According to Company’s Amended and Restated Certificate of Incorporation (the “Articles”) and the Bylaws, a director of the Company shall not be personally liable to the Company or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director’s duty of loyalty to the Company or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the DGCL, or (iv) for any transaction from which the director derived an improper personal benefit. If the DGCL is amended to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability of a director of the Company shall be eliminated or limited to the fullest extent permitted by the DGCL, as so amended. Any repeal or modification of the Article 8 by the stockholders of the Company shall not adversely affect any right or protection of a director of the Company with respect to events occurring prior to the time of such repeal or modification.
thereby.
Item 15. | Recent |
Common Stock.
Common Stock.
On, May 6, 2021, an institutional investor exercised a warrant issued in the PIPE Investment with respect to 92,000 shares of our common stock pursuant to the cashless exercise provisions on the warrant, resulting in the issuance of 47,866 shares of our common stock.
On, February 16, 2021, an institutional investor exercised a warrant issued in the PIPE Investment with respect to 11,429 shares of our common stock pursuant to the cashless exercise provisions on the warrant, resulting in the issuance of 11,429 shares of our common stock.
On, March 17, 2021, an institutional investor exercised a warrant issued in the PIPE Investment with respect to 276,737 shares of our common stock pursuant to the cashless exercise provisions on the warrant, resulting in the issuance of 276,737 shares of our common stock.
Common Stock.
Item 16. | Exhibits and |
(a) | Exhibits. |
Exhibit Number |
| Description | ||
| |||
Agreement and Plan of Merger, dated as of October 27, 2017, by and among Andina Acquisition Corp. II, Andina II Holdco Corp., Andina II Merger Sub Inc., Lazy Days’ R.V. Center, Inc. and A. Lorne Weil (included as Annex A to the Proxy Statement/Prospectus/Information Statement filed on February 14, 2018 and incorporated herein by reference). | |||
| | Asset Purchase Agreement among BYRV, Inc., BYRV Washington, Inc., Bruce Young, Mark Bretz, The Bruce A. Young Revocable Trust, The Bruce A. Young 2021 Gift Trust and Lazydays RV of Oregon, LLC, effective as of July 9, 2021 (filed as Exhibit 2.1 to the Quarterly Report on Form 10-Q for the quarter ended September 30, 2021 and incorporated herein by reference). | |
| Amended and Restated Certificate of Incorporation of Lazydays Holdings, Inc. | ||
| Amended and Restated Bylaws of Lazydays Holdings, Inc. | ||
| | Certificate of Designations of Series A Preferred Stock of Lazydays Holdings, Inc. (included | |
| | Specimen Common Stock Certificate of Lazydays Holdings, Inc. (filed as Exhibit 4.5 to the Registration Statement on Form S-4 (SEC File No. 333-221723) filed on January 16, 2018 and incorporated herein by reference). | |
| | Form of Unit Purchase Option | |
| | Warrant Agreement between Continental Stock Transfer & Trust Company and Andina | |
| | Form of Specimen Series A Preferred Stock Certificate (filed as Exhibit 4.4 to the Registration Statement on Form S-1 (SEC File No. 333-224063) filed | |
| | Form of Common Stock purchase warrant (filed as Exhibit 4.5 to the Registration Statement on Form S-1 (SEC File No. 333-224063) filed | |
| | Form of Pre-Funded Common Stock Purchase warrant (filed as Exhibit 4.6 to the Registration Statement on Form S-1 (SEC File No. 333-224063) filed | |
| | Description of Registrant’s Securities (filed as Exhibit 4.7 to the Annual Report on Form 10-K for the year ended December 31, 2020 and incorporated herein by reference). | |
| | Form of Rights Certificate. | |
| | Subscription and Information Agent Agreement by and between Lazydays Holdings, Inc. and Broadridge Corporate Issuer Solutions, LLC. | |
| | Opinion of | |
| | Opinion of Paul Hastings LLP relating to the U.S. Tax Matters. | |
| | Registration Rights Agreement between Andina and certain security holders of Andina (incorporated by reference to Exhibit 10.1 of Andina’s Current Report on Form 8-K filed on December 1, | |
| | 2018 Long-Term Incentive | |
| | Employment Agreement between Lazydays Holdings, Inc. and William |
Exhibit Number | | | Description |
| | Employment Agreement, by and between the Company and Robert DeVincenzi, dated January 3, 2022 (filed as Exhibit 10.1 to the Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 and incorporated herein by reference). | |
| | Amended and Restated Employment Agreement, dated September 6, 2022, by and between the Company and John North (filed as Exhibit 10.1 to the Quarterly Report on Form 10-Q for the quarter ended September 30, 2022 and incorporated herein by reference). | |
| | Employment Agreement, by and between the Company and Kelly Porter, dated October 3, 2022 (filed as Exhibit 10.6 to the Annual Report on Form 10-K for the year ended December 31, 2022 and incorporated herein by reference). | |
| | Transition Agreement, dated October 19, 2022, by and between the Company and Nicholas Tomashot (filed as Exhibit 10.7 to the Annual Report on Form 10-K for the year ended December 31, 2022 and incorporated herein by reference). | |
| | Second Amended and Restated Credit Agreement dated February 21, 2023 with Manufacturers and Traders Trust Company (“M&T”), as Administrative Agent, Swingline Lender, Issuing Bank and a Lender, and other financial institutions as Lender parties. (filed as Exhibit 10.1 to the Quarterly Report on Form 10-Q for the quarter ended March 31, 2023 and incorporated herein by reference). | |
| | Form of Securities Purchase Agreement (Preferred) (filed as Exhibit 10.13.1 to the Registration Statement on Form S-4 (SEC File No. 333-221723) and incorporated herein by reference). | |
| | Form of Securities Purchase Agreement (Unit) (filed as Exhibit 10.13.2 to the Registration Statement on Form S-4 (SEC File No. 333-221723) and incorporated herein by reference). | |
| | Lease Agreement by and between Cars MTI-4 L.P., as Landlord, and LDRV Holdings Corp., as Tenant (filed as Exhibit 10.14 to the Registration Statement on Form S-4 (SEC File No. 333-221723) and incorporated herein by reference). | |
| | Lease Agreement between Chambers 3640, LLC, as Landlord, and Lazydays Mile HI RV, LLC, as Tenant (filed as Exhibit 10.15 to the Registration Statement on Form S-4 (SEC File No. 333-221723) and incorporated herein by reference). | |
| | Lease Agreement between 6701 Marketplace Drive, LLC, as Landlord, and Lazydays RV America, LLC, as Tenant (filed as Exhibit 10.16 to the Registration Statement on Form S-4 (SEC File No. 333-221723) and incorporated herein by reference). | |
| | Lease Agreement between DS Real Estate, LLC, as Landlord, and Lazydays RV Discount, LLC, as Tenant (filed as Exhibit 10.17 to the Registration Statement on Form S-4 (SEC File No. 333-221723) and incorporated herein by reference). | |
| | Restated Credit Agreement, dated | |
| | First Amendment to Amended and Restated Credit Agreement, dated as of May 13, 2022, by and among LDRV Holdings Corp., Lazydays RV America, LLC, Lazydays RV Discount, LLC and Lazydays Mile HI RV, LLC, Manufacturers and Traders Trust Company, as Administrative Agent, Swingline Lender, Issuing Bank and a Lender, and other financial institutions as Lender parties (filed as Exhibit 10.1 to the Current Report on Form 8-K filed on | |
| | Security Agreement, dated March 15, 2018, by and between LDRV Holdings Corp., Lazydays RV America, LLC, Lazydays RV Discount, LLC, and Lazydays Mile HI RV, LLC, as Borrowers, Lazydays Holdings Inc., Lazy Days’ R.V. Center, Inc., Lazydays RV America, LLC, and Lazydays Land Holdings, LLC, as Guarantors, and Manufacturers and Traders Trust Company, as administrative agent under the Credit Agreement of even date therewith (filed as Exhibit 10.11 to the Form 8-K filed on March 21, |
Guaranty Agreement, dated March 15, 2018, by certain parties named therein (filed as |
Exhibit Number | | | Description |
| | Form of Registration Rights Agreement between Lazydays Holdings, Inc. and the PIPE | |
| | Form of Registration Rights Agreement between Lazydays Holdings, Inc. and the PIPE | |
| | Employment Offer Letter between Lazydays Holdings, Inc. and Nicholas | |
| |||
Lazydays Holdings, Inc. 2019 Employee Stock Purchase Plan (filed as Exhibit 10.1 to the Form 8-K filed on May 23, | |||
| | Lazydays Holdings, Inc. Amended and Restated 2018 Long Term Incentive Plan (filed as | |
| |||
Form of Term Note (U.S. Small Business Administration Paycheck Protection Program) in favor of M&T Bank (filed as Exhibit 10.1 to | |||
| | Subsidiaries of the Company (filed as Exhibit 21.1 to the Annual Report on Form 10-K for the year ended December 31, | |
| |||
Consent of RSM US LLP. | |||
23.2# | | ||
| Powers of | ||
| | Form of Instructions for Use of Lazydays Holdings, Inc.’s Rights Certificates. | |
| | Form of Letter to Stockholders who are Record Holders. | |
| | Form of Letter to Brokers and Other Nominee Holders. | |
| | Form of Letter to Clients of Brokers and Other Nominee Holders. | |
| | Form of Beneficial Owner Election Form. | |
| | Form of Nominee Holder Certification. | |
| | Form of Notice of Guaranteed Delivery. | |
| | Consent dated as of October 12, 2023 by Lazydays Holdings Inc. (the “Company”) and the holders of the Series A Convertible Preferred Stock of the Company listed on the signature page | |
| Filing Fee Table | ||
* | Filed herewith. |
** | To be filed by amendment. |
+ |
# | Filed previously. |
(b) | Financial statement schedules. |
Item 17. |
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
(a) |
(1) | To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
(i) | To include any prospectus required by Section 10(a)(3) of the Securities Act; |
(ii) | To reflect in the prospectus any facts or events arising after the effective date of this registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration |
(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration
(iii) and
(iii) | To include any material information with respect to the plan of distribution not previously disclosed in this registration statement or any material change to such information in this registration statement; |
(2) | That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
(3) | To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. |
(4) | That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser: if the registrant is subject to Rule 430C (§230.430C of this chapter), each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A (§230.430A of this chapter), shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use. |
(5) | That, for the purpose of determining liability of the registrant under the Securities Act to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: |
(i) | any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424 (§230.424 of this chapter); |
(ii) | any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; |
(iii) | the portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and |
(iv) | any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
(b) | The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the registrant’s annual report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to |
(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(4) For determining liability under the Securities Act to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
(5) That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities:
The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
(iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant to section 13(a) or section
(c) |
(d) | The undersigned registrant hereby undertakes that: |
(1) | For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(I) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective; and |
(2) | For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
SIGNATURES
| | LAZYDAYS HOLDINGS, INC. | ||||
| | |||||
| By: | | | /s/ | ||
| | | John North | |||
| | | | Chief Executive Officer |
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints William P. Murnane and Nicholas J. Tomashot and each of them, his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Registration Statement, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Signature | | Title | | | Date | |
| | | | |||
/s/ | | | Chief Executive Officer and (Principal Executive Officer) | | October 20, 2023 | |
John North | | |||||
| | | | |||
/s/ | | | Chief Financial Officer | |||
(Principal Financial Officer and Principal Accounting Officer) | | | October 20, 2023 | |||
Kelly Porter | | |||||
| | | | |||
* | | Director and Chairman of the Board | | October 20, 2023 | ||
Christopher S. Shackelton | | | ||||
| | | | |||
* | | Lead Independent Director | | October 20, 2023 | ||
Robert | | |||||
| | | | |||
* | | | Director | | | October 20, 2023 |
Jordan Gnat | | |||||
| | | | |||
/s/ Susan Scarola | | | Director | | | October 20, 2023 |
Susan Scarola | | |||||
| | | | |||
* | | | Director | | | October 20, 2023 |
James J. Fredlake | ||||||
| | | | |||
* | | | Director | | | October 20, 2023 |
Jerry Comstock | ||||||
| | | | |||
/s/ Suzanne Tager | | | Director | | | October 20, 2023 |
Suzanne Tager | |
*By: | | | /s/ | | |||
| | John North Attorney-in-Fact | |||||
| | ||||||