LSEAW Landsea Homes Corporation

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K/A

(Amendment No. 2)

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): April 1, 2024

 

LANDSEA HOMES CORPORATION

(Exact name of registrant as specified in its charter)

 

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

 

1717 McKinney Avenue, Suite 1000
Dallas, Texas		75202
(Address of principal executive offices)		(Zip Code)

 

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

 

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

 

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

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

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

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

 

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

 

Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
Common Stock, par value $0.0001 per share		LSEA		The Nasdaq Capital Market
Warrants exercisable for Common Stock		LSEAW		The Nasdaq Capital Market

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter)
	Emerging growth company	☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13 (a) of the Exchange Act.		☐

 

 

Explanatory Note

 

Landsea Homes Corporation (the “Company”) filed a Current Report on Form 8-K with the Securities and Exchange Commission (the “SEC”) on April 2, 2024 (the “Original Report”) to report under Item 2.01 thereof the completion, on April 1, 2024, of the Company’s acquisition (the “Acquisition”) of all of the outstanding membership interests of Antares Acquisition, LLC (“Antares”). As reported in the Original Report, (i) the audited financial statements of Antares as of and for the years ended December 31, 2023 and 2022 and the associated independent auditor reports and (ii) the unaudited pro forma condensed combined financial information of the Company as of and for the year ended December 31, 2023 giving effect to the Acquisition and related transactions, representing the information required to be filed by the Company under Item 9.01(a) and Item 9.01(b) to Form 8-K with respect to the Acquisition, were previously reported in the Company’s Current Report on Form 8-K filed with the SEC on March 18, 2024. Pursuant to General Instruction B.3 of Form 8-K, such information was not additionally reported in the Original Report, and instead was incorporated by reference therein. The Company is filing this Current Report on Form 8-K/A in order to supplementally file the unaudited pro forma condensed combined financial information of the Company for the nine months ended September 30, 2024 and for the year ended December 31, 2023 to give effect to the Acquisition and related transactions.

 

Item 9.01 Financial Statements and Exhibits.

 

Pro Forma Financial Information:

 

Filed as Exhibit 99.1 to this Current Report on Form 8-K/A, and incorporated herein by reference, is the unaudited pro forma condensed combined financial information of the Company for the nine months ended September 30, 2024 and for the year ended December 31, 2023.

 

This unaudited pro forma combined financial information is provided for illustrative purposes only and does not purport to represent what the Company’s actual results of operations or financial position would have been if the Acquisition had occurred on the dates indicated, nor is it necessarily indicative of the Company’s future operating results or financial position.

 

(d) Exhibits:

 

Exhibit No.	Description
99.1	Unaudited Pro Forma Condensed Combined Financial Information of the Company for the nine months ended September 30, 2024 and for the year ended December 31, 2023.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

 

SIGNATURES

 

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

 

		LANDSEA HOMES CORPORATION
Date: December 5, 2024	By:	/s/ C. Kelly Rentzel
		Name: C. Kelly Rentzel
		Title: General Counsel

 

 

 

Exhibit 99.1

 

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

 

On April 1, 2024, Landsea Homes Corporation (together with its subsidiaries, “Landsea Homes” or the “Company”) completed the previously announced acquisition of Antares (“Antares Acquisition”) for approximately $239.8 million (subject to certain customary post-closing adjustments) using a combination of cash on hand and borrowings under the Company’s existing credit facility, which included repayment of approximately $40.2 million of Antares debt. The following unaudited pro forma condensed combined financial information presents the combination of the financial information of the Company and Antares, adjusted to give effect to the completion of the Antares Acquisition. The unaudited pro forma condensed combined balance sheet as of September 30, 2024 is not presented as the Antares Acquisition is reflected in the Company’s historical unaudited consolidated balance sheet as of September 30, 2024.

 

The unaudited pro forma condensed combined financial information has been prepared in accordance with Regulation S-X Article 11, Pro Forma Financial Information, as amended by the final rule, Amendments to Financial Disclosures About Acquired and Disposed Businesses, as adopted by the Securities and Exchange Commission (“SEC”) on May 20, 2020. The unaudited pro forma condensed combined financial information is presented as follows:

 

·

The unaudited pro forma condensed combined statement of operations for the nine months ended September 30, 2024 was prepared based on (i) the historical unaudited consolidated statement of operations of Company for the nine months ended September 30, 2024 and (ii) the historical unaudited consolidated statement of operations of Antares for the three months ended March 31, 2024.

 

·

The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2023 was prepared based on (i) the historical audited consolidated statement of operations of Company for the year ended December 31, 2023, (ii) the historical audited consolidated statement of operations of Antares for the year ended December 31, 2023.

 

The historical financial statements of the Company and Antares have been adjusted in the accompanying unaudited pro forma condensed combined financial information to give effect to pro forma events which are necessary to account for the Antares Acquisition, in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The historical combined financial information of the Company has been adjusted in the unaudited pro forma condensed financial information to give effect to pro forma events that are: (i) directly attributable to the Antares Acquisition, (ii) factually supportable, and (iii) with respect to the statements of operations, are expected to have a continuing effect on the combined operating results. In the opinion of management, all adjustments necessary to present fairly the pro forma financial information have been reflected. The assumptions underlying the pro forma adjustments are described fully in the accompanying notes, which should be read in conjunction with the unaudited pro forma condensed financial information.

 

The Antares Acquisition was accounted for as a business combination using the acquisition method, with Landsea Homes as the accounting acquirer in accordance with Accounting Standards Codification (“ASC”) Topic 805, Business Combinations (“ASC 805”). Under this method of accounting, the total consideration was allocated to Antares’ assets acquired and liabilities assumed based upon their estimated fair values at the consummation of the Antares Acquisition on April 1, 2024 (“closing date”). Any differences between the fair value of the consideration transferred and the fair value of the assets acquired, and liabilities assumed, were recorded as goodwill. The pro forma allocation of the purchase price reflected in the unaudited pro forma condensed combined financial information is preliminary and thus subject to adjustment and may vary materially from the final purchase price allocation that will be completed within the measurement period, but in no event later than one year following the closing date.

 

The following unaudited pro forma condensed combined financial information have been prepared to give effect to the Antares Acquisition and related financing, which includes adjustments for the following:

 

·

Certain reclassifications to conform Antares’ historical financial statement presentation to Landsea Homes’ presentation;

 

·

Application of the acquisition method of accounting under the provisions of ASC 805 and to reflect estimated consideration of approximately $239.8 million; and

 

·

Proceeds of Senior Notes offered and sold by Landsea Homes to finance the Antares Acquisition and the settlement of a portion of outstanding borrowings under Landsea Homes’ existing revolving credit facility.

 

 

Unaudited Pro Forma Condensed Combined Statement of Operations
For the Nine Months Ended September 30, 2024
(dollars in thousands, except share and per share data)

 

		For the Nine Months Ended September 30, 2024				For the Three Months Ended March 31, 2024
		Landsea Homes				Antares Adjusted (Note 2)				Transaction Accounting Adjustments								Financing Adjustments								Pro Forma Combined
Revenue
Home sales		$	1,036,384			$	42,656				—								—							$	1,079,040
Lot sales and other			27,272				—				—								—								27,272
Total revenue			1,063,656				42,656				—								—								1,106,312
Cost of sales
Home sales			874,724				32,593				(6,381	)			AA				7,145				EE				903,198
											(1,098	)			CC				(3,785	)			FF
Lot sales and other			22,478				—				—								—								22,478
Total cost of sales			897,202				32,593				(7,479	)							3,360								925,676
Gross margin			166,454				10,063				7,479								(3,360	)							180,636
Operating expenses
Sales and marketing expenses			66,596				2,515				—								—								69,111
General and administrative expenses			77,569				2,237				(435	)			BB				—								79,371
Total Operating expenses			144,165				4,752				(435	)							—								148,482
Income from operations			22,289				5,311				7,914								(3,360	)							32,154
Other (expense) income, net			(2,091	)			43				—								—								(2,048	)
Pretax income			20,198				5,354				7,914								(3,360	)							30,106
(Benefit) Provision for income taxes			4,838				75				1,662				DD				(706	)			GG				5,869
Net income			15,360				5,279				6,252								(2,654	)							24,237
Net income attributable to non-controlling interests			1,175				—				—								—								1,175
Net income attributable to Landsea Homes		$	14,185			$	5,279			$	6,252							$	(2,654	)						$	23,062
Income per share:			—				—				—								—								—
Basic		$	0.39								—								—							$	0.64
Diluted		$	0.39								—								—							$	0.63
Weighted average common shares outstanding:											—								—
Basic			36,252,957								—								—								36,252,957
Diluted			36,548,768								—								—								36,548,768

 

See accompanying notes to unaudited pro forma condensed combined financial information.

 

 

Unaudited Pro Forma Condensed Combined Statement of Operations
For the Year Ended December 31, 2023
(dollars in thousands, except share and per share data)
		For the Year Ended December 31, 2023				For the Year Ended December 31, 2023
		Landsea Homes				Antares Adjusted (Note 2)				Transaction Accounting Adjustments								Financing Accounting Adjustments								Pro Forma Combined
Revenue
Home sales		$	1,169,867			$	171,142				—								—							$	1,341,009
Lot sales and other			40,080				—				—								—								40,080
Total revenue			1,209,947				171,142				—								—								1,381,089
Cost of sales
Home sales			967,034				129,551				28,366				AA				28,581				EE				1,134,327
											(4,729	)			CC				(14,476	)			FF
Lot sales and other			27,939				—				—								—								27,939
Total cost of sales			994,973				129,551				23,637								14,105								1,162,266
Gross margin			214,974				41,591				(23,637	)							(14,105	)							218,823
Operating expenses
Sales and marketing expenses			73,248				11,539				—								—								84,787
General and administrative expenses			101,442				10,082				1,590				BB				—								113,134
Total Operating expenses			174,690				21,621				1,590								—								197,901
Income from operations			40,284				19,970				(25,227	)							(14,105	)							20,922
Other income, net			4,261				98				—								—								4,359
Pretax income			44,545				20,068				(25,227	)							(14,105	)							25,281
(Benefit) Provision for income taxes			11,895				372				(5,298	)			DD				(2,962	)			GG				4,007
Net income			32,650				19,696				(19,929	)							(11,143	)							21,274
Net income attributable to non-controlling interests			3,414				—				—								—								3,414
Net (loss) income attributable to Landsea Homes		$	29,236			$	19,696			$	(19,929	)						$	(11,143	)						$	17,860
Income per share:			—				—				—								—								—
Basic		$	0.75								—								—							$	0.46
Diluted		$	0.75								—								—							$	0.46
Weighted average common shares outstanding:											—								—
Basic			38,885,003								—								—								38,885,003
Diluted			39,076,322								—								—								39,076,322

 

See accompanying notes to unaudited pro forma condensed combined financial information.

 

 

Notes to the Unaudited Pro Forma Condensed Combined Financial Information

 

1. Basis of Presentation

 

The unaudited pro forma condensed combined financial information has been prepared by Landsea Homes in accordance with Regulation S-X Article 11, Pro Forma Financial Information, as amended by the final rule, Amendments to Financial Disclosures About Acquired and Disposed Businesses, as adopted by the SEC on May 20, 2020.

 

The unaudited pro forma condensed combined financial information was prepared using the acquisition method of accounting in accordance with ASC 805, with Landsea Homes as the accounting acquirer and based on the historical consolidated financial statements of Landsea Homes and Antares. Under ASC 805, assets acquired, and liabilities assumed in a business combination are recognized and measured at their assumed acquisition date fair value, while transaction costs associated with a business combination are expensed as incurred. The excess of purchase consideration over the fair value of assets acquired and liabilities assumed, if any, is allocated to goodwill.

 

The unaudited pro forma condensed combined statement of operations for the nine months ended September 30, 2024 and year ended December 31, 2023, gives effect to the Antares Acquisition and related financing as if they occurred on January 1, 2023.

 

The unaudited pro forma condensed combined financial information does not reflect any anticipated synergies or dis-synergies, operating efficiencies or cost savings that may result from the Antares Acquisition and integration costs that may be incurred. The pro forma adjustments represent Landsea Homes’ best estimates and are based upon currently available information and certain assumptions that Landsea Homes believes are reasonable under the circumstances.

 

2. Accounting Policies and Reclassification Adjustments

 

The accounting policies used in the preparation of these unaudited pro forma condensed combined financial information are those set out in Landsea Homes’ audited consolidated financial statements as of and for the year ended December 31, 2023, and subsequent interim period. Landsea Homes performed a preliminary review of Antares’ accounting policies to determine whether any adjustments were necessary to ensure comparability in the unaudited pro forma condensed combined financial information. Certain FSLI reclassifications have been reflected in the pro forma adjustments to conform Antares’ presentation to Landsea Homes’ presentation in the unaudited pro forma condensed combined financial information.

 

Reclassification adjustments that have been made to the historical presentation of Antares to conform to the financial statement presentation of Landsea Homes are as follows:

 

 

Unaudited Pro Forma Condensed Combined Statement of Operations – Three months ended March 31, 2024

 

Landsea Homes		Antares		Antares Historical				Reclassification Adjustments				Notes		Antares Historical Adjusted
				(dollars in thousands)
Revenue
Home sales		Homebuilding Revenues, Net		$	42,656									$	42,656
Lot sales and other															—
Total revenues					42,656				—						42,656
Cost of sales
Home sales									32,593			(a), (b), (e)			32,593
		Direct house costs			23,446				(23,446	)		(a)			—
		Interest			807				(807	)		(a)			—
		Indirect house costs			299				(299	)		(a)			—
Lot sales and other															—
		Lot costs			7,680				(7,680	)		(b)			—
		Closing costs			70				(70	)		(b)			—
Total cost of sales					32,302				291						32,593
Gross margin					10,354				(291	)					10,063
Sales and marketing expenses									2,515			(c),(d)			2,515
General and administrative expenses									2,237			(d)			2,237
		Selling, general and administrative expenses			5,043				(1,816	)		(c)			—
									(2,936	)		(d)
									(291	)		(e)
Total operating expenses					5,043				(291	)					4,752
Income from operations					5,311				—						5,311
Other income, net		Other income			43										43
Pretax income					5,354				—						5,354
Provision for income taxes									75			(f)			75
		State income tax, current			75				(75	)		(f)			—
Net income					5,279				—						5,279
Net income attributable to non-controlling interests															—
Net income attributable to Landsea Homes				$	5,279			$	—					$	5,279

 

(a) Adjustment to reclassify Antares’ Direct house costs, Interest and Indirect house costs to Home sales (Cost of sales)

(b) Adjustment to reclassify Antares’ Lot costs, Closing costs to Home sales (Cost of sales)

(c) Adjustment to reclassify Antares’ Commission expense to Sales and marketing expenses

(d) Adjustment to reclassify Antares’ Selling, general and administrative expenses to Sales and marketing expenses and General and administrative expenses

(e) Adjustment to reclassify Antares’ Spec interest expense and Model interest expense to Home sales (Cost of sales)

(f) Adjustment to reclassify Antares’ State income tax, current to Provision for income taxes

 

 

Unaudited Pro Forma Condensed Combined Statement of Operations – Year ended December 31, 2023

 

Landsea Homes		Antares		Antares Historical				Reclassification Adjustments				Notes		Antares Historical Adjusted
				(dollars in thousands)
Revenue
Home sales		Homebuilding Revenues, Net		$	171,142									$	171,142
Lot sales and other															—
Total revenues					171,142				—						171,142
Cost of sales
Home sales									129,551			(a), (b), (e)			129,551
		Direct house costs			92,915				(92,915	)		(a)			—
		Interest			3,629				(3,629	)		(a)			—
		Indirect house costs			1,376				(1,376	)		(a)			—
Lot sales and other															—
		Lot costs			30,251				(30,251	)		(b)			—
		Closing costs			281				(281	)		(b)			—
Total cost of sales					128,452				1,099						129,551
Gross margin					42,690				(1,099	)					41,591
Sales and marketing expenses									11,539			(c),(d)			11,539
General and administrative expenses									10,082			(d)			10,082
		Selling, general and administrative expenses			22,720				(7,442	)		(c)			—
									(14,179	)		(d)
									(1,099	)		(e)
Total operating expenses					22,720				(1,099	)					21,621
Income from operations					19,970				—						19,970
Other income, net		Other income			98										98
Pretax income					20,068				—						20,068
Provision for income taxes									372			(f)			372
		State income tax, current			372				(372	)		(f)			—
Net income					19,696				—						19,696
Net income attributable to non-controlling interests															—
Net income attributable to Landsea Homes				$	19,696			$	—					$	19,696

 

(a) Adjustment to reclassify Antares’ Direct house costs, Interest and Indirect house costs to Home sales (Cost of sales)

(b) Adjustment to reclassify Antares’ Lot costs, Closing costs to Home sales (Cost of sales)

(c) Adjustment to reclassify Antares’ Commission expense to Sales and marketing expenses

(d) Adjustment to reclassify Antares’ Selling, general and administrative expenses to Sales and marketing expenses and General and administrative expenses

(e) Adjustment to reclassify Antares’ Spec interest expense and Model interest expense to Home sales (Cost of sales)

(f) Adjustment to reclassify Antares’ State income tax, current to Provision for income taxes

 

 

3. Adjustments to Unaudited Pro Forma Condensed Combined Statement of Operations

 

Transaction Accounting Adjustments

 

(AA) To record an increase to cost of sales of $28.4 million related to the inventory fair value step up on Homes completed or under construction and Land held or under development for the year ended December 31, 2023 and reversal of $6.4 million representing the impact for inventory fair value step up sold post close of the Antares Acquisition that is already recognized in the historicals for the nine months ended September 30, 2024 by Landsea Homes. The Company will recognize the increased value of inventory in cost of sales as the acquired inventory is sold, which for purposes of these unaudited pro forma condensed combined financial information is expected to occur within the first year of Antares Acquisition. The Company does not expect the inventory step-up to affect its income statement beyond 12 months after the closing date.

 

(BB) To record the incremental amortization expense on a straight-line basis related to the fair value step up on the acquired intangible assets of $1.6 million for the year ended December 31, 2023 and $0.4 million for the nine months ended September 30, 2024, offset by $0.8 million already recognized in the historicals for the nine months ended September 30, 2024 by Landsea Homes.

 

(CC) To record the elimination of historical interest expense and amortization cost related to Antares’ debt that was paid off by Landsea Homes as part of the consideration for the Antares Acquisition.

 

(DD) To record the income tax effect of the pro forma transaction accounting adjustments using the statutory tax rate of 21%. This does not necessarily reflect the amount that would have resulted had Landsea Homes, following the consummation of the Antares Acquisition, filed consolidated income tax returns during the periods presented.

 

Financing Adjustments

 

(EE) To record an adjustment to interest expense resulting from the offering and sale of Senior Notes by Landsea Homes, as well as amortization of the associated debt issuance costs.

 

(FF) To record an adjustment to remove the interest expense on account of settlement of a portion of outstanding borrowings under the existing revolving credit facility included in Landsea Homes’ historical consolidated statements of operations.

 

(GG) To record the income tax effect of the pro forma financing adjustments using the statutory tax rate of 21%. This does not necessarily reflect the amount that would have resulted had Landsea Homes, following the consummation of the Antares Acquisition, filed consolidated income tax returns during the periods presented.

 

 

4. Earnings Per Share

 

The following table sets forth the computation of pro forma basic and diluted earnings per share for the nine months ended September 30, 2024 and year ended December 31, 2023.

 

(in thousands, except share and per share data)		For the nine months ended September 30, 2024				For the year ended December 31, 2023
Numerator:
Net income - basic and diluted		$	23,062			$	17,860
Denominator:
Weighted average shares outstanding
Basic			36,252,957				38,885,003
Diluted			36,548,768				39,076,322
Pro forma net income per share:
Basic		$	0.64			$	0.46
Diluted		$	0.63			$	0.46

 

8

 

v3.24.3

Cover	Apr. 01, 2024
Document Type	8-K/A
Amendment Flag	true
Amendment Description	Explanatory Note Landsea Homes Corporation (the “Company”) filed a Current Report on Form 8-K with the Securities and Exchange Commission (the “SEC”) on April 2, 2024 (the “Original Report”) to report under Item 2.01 thereof the completion, on April 1, 2024, of the Company’s acquisition (the “Acquisition”) of all of the outstanding membership interests of Antares Acquisition, LLC (“Antares”). As reported in the Original Report, (i) the audited financial statements of Antares as of and for the years ended December 31, 2023 and 2022 and the associated independent auditor reports and (ii) the unaudited pro forma condensed combined financial information of the Company as of and for the year ended December 31, 2023 giving effect to the Acquisition and related transactions, representing the information required to be filed by the Company under Item 9.01(a) and Item 9.01(b) to Form 8-K with respect to the Acquisition, were previously reported in the Company’s Current Report on Form 8-K filed with the SEC on March 18, 2024. Pursuant to General Instruction B.3 of Form 8-K, such information was not additionally reported in the Original Report, and instead was incorporated by reference therein. The Company is filing this Current Report on Form 8-K/A in order to supplementally file the unaudited pro forma condensed combined financial information of the Company for the nine months ended September 30, 2024 and for the year ended December 31, 2023 to give effect to the Acquisition and related transactions.
Document Period End Date	Apr. 01, 2024
Entity File Number	001-38545
Entity Registrant Name	LANDSEA HOMES CORPORATION
Entity Central Index Key	0001721386
Entity Tax Identification Number	82-2196021
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	1717 McKinney Avenue
Entity Address, Address Line Two	Suite 1000
Entity Address, City or Town	Dallas
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	75202
City Area Code	(949)
Local Phone Number	345-8080
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	false
Common Stock, par value $0.0001 per share
Title of 12(b) Security	Common Stock, par value $0.0001 per share
Trading Symbol	LSEA
Security Exchange Name	NASDAQ
Warrants exercisable for Common Stock
Title of 12(b) Security	Warrants exercisable for Common Stock
Trading Symbol	LSEAW
Security Exchange Name	NASDAQ

---