Harbor Custom Development, Inc. (Nasdaq: HCDI, HCDIP, HCDIW, HCDIZ)
(“Harbor,” “Harbor Custom Homes®,” or the “Company”), an innovative
and market leading real estate company involved in all aspects of
the land development cycle, today announced the pricing of its
underwritten public offering (the “Offering”) of 2,400,000 shares
of 8.0% Series A Cumulative Convertible Preferred Stock (the
“Series A Preferred Stock”) and 12,000,000 warrants to each
purchase one share of common stock (“Warrants”). Each share of
Series A Preferred Stock will be accompanied by five Warrants. Each
share of Series A Preferred Stock and accompanying five Warrants is
being offered at a price of $15.00. The shares of Series A
Preferred Stock and Warrants will be issued separately but can only
be purchased together in this Offering. Harbor Custom Development,
Inc. has granted the underwriters a 45-day option to purchase up to
360,000 additional shares of Series A Preferred Stock and/or
1,800,000 additional Warrants solely to cover over-allotments, if
any.
Each share of Series A Preferred Stock is
convertible into common shares at a conversion price of $4.50 per
common share, or 5.556 common shares, at any time at the option of
the holder, subject to certain customary adjustments. The Warrants
are exercisable immediately, have an exercise price of $2.97 per
share and expire five years from the date of issuance. If the
trading price of Harbor Custom Development, Inc.’s common stock
equals or exceeds $7.65 per share for at least 20 trading days in
any 30 consecutive trading day period, the Company can call for
mandatory conversion of the Series A Preferred Stock. Dividends on
the Series A Preferred Stock shall be cumulative and paid monthly
in arrears starting July 20, 2021, to the extent declared by the
board of directors of the Company. The Series A Preferred
Stock will not be redeemable for a period of three years from June
9, 2021, except upon a change of control of the Company.
The Offering is expected to close on October 7,
2021, subject to the satisfaction of customary closing
conditions. The Warrants will begin trading on The Nasdaq
Capital Market on October 5, 2021 under the symbol “HCDIZ.”
ThinkEquity is acting as sole book-running
manager for the Offering.
A registration statement on Form S-1 (File No. 333-259465) relating
to the offer and sale of the securities referred to herein was
filed by the Company with the Securities and Exchange Commission
(“SEC”) under the Securities Act of 1933, as amended, (the
“Securities Act”), and was declared effective by the SEC on October
4, 2021 and a related registration statement on Form S-1 was filed
pursuant to Rule 462(b) of the Securities Act to increase the size
of the Offering set forth in the earlier effective registration
statement on Form S-1. This offering is being made only by
means of a prospectus. Copies of the final prospectus, when
available, may be obtained from ThinkEquity, 17 State Street, 22nd
Floor, New York, New York 10004, by telephone at (877) 436-3673, by
email at prospectus@think-equity.com. The final prospectus
will be filed with the SEC and will be available on the SEC’s
website located at http://www.sec.gov.
The press release shall not constitute an offer
to sell or the solicitation of an offer to buy any of the
securities described herein, nor shall there be any sale of these
securities in any state or jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such state or
jurisdiction.
About Harbor Custom Development, Inc.
Harbor Custom Development, Inc. is a real estate
development company involved in all aspects of the land development
cycle including land acquisition, entitlements, construction of
project infrastructure, home building, marketing, sales, and
management of various residential projects in Western Washington's
Puget Sound region; Sacramento, California; Austin, Texas and Punta
Gorda, Florida. Harbor has active or recently sold-out residential
communities in Gig Harbor, Bremerton, Silverdale, Bainbridge
Island, Belfair, Allyn, Port Orchard, Lacey, Burien, Yelm and
Blaine in the state of Washington. In addition, Harbor has acquired
land and will begin constructing homes in three new markets. In the
Sacramento metro market, Harbor will be constructing homes in
completed subdivisions in both Rocklin and Auburn, California. In
the Austin metro market, Harbor has acquired developed lot
inventory in Dripping Springs, Driftwood, and Horseshoe Bay, Texas.
The Company recently acquired property in Punta Gorda, Florida, and
plans to begin construction of oceanfront condominiums there in
2022. Harbor Custom Development's business strategy is to acquire
and develop land strategically, based on an understanding of
population growth patterns, entitlement restrictions,
infrastructure development, and geo-economic forces. Harbor
focuses on real estate within target markets with convenient access
to metropolitan areas that are generally characterized by diverse
economic and employment bases and increasing populations. For
more information on Harbor Custom Development, Inc., please
visit www.harborcustomdev.com.
Forward Looking Statements
Certain statements in this press release
constitute “forward-looking statements” within the meaning of the
federal securities laws. Words such as “may,” “might,” “should,”
“believe,” “expect,” “anticipate,” “estimate,” “continue,”
“predict,” “forecast,” “project,” “plan,” “intend” or similar
expressions, or statements regarding intent, belief, or current
expectations, are forward-looking statements. These forward-looking
statements are based upon current estimates and assumptions and
include statements regarding the completion of the Offering, the
amount of proceeds, the listing of the Company’s securities and the
Company’s future operational plans. While the Company believes
these forward-looking statements are reasonable, undue reliance
should not be placed on any such forward-looking statements, which
are based on information available to us on the date of this
release. These forward-looking statements are subject to various
risks and uncertainties, including without limitation those set
forth in the Company’s filings with the SEC, including under the
heading “Risk Factors” in the Company’s registration statement on
Form S-1. Thus, actual results could be materially different. The
Company expressly disclaims any obligation to update or alter
statements whether as a result of new information, future events or
otherwise, except as required by law.
Investor Relations:
Hanover International
IR@harborcustomdev.com
866-744-0974
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