UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K

(Mark One)

ORor

For the transition period from _________ to ________

Commission file number: 001-38424

Lazydays Holdings, Inc.

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code:(813)246-4999

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

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

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [  ] ☐ No [X] ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes [  ] ☐ No [X] ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] ☒ No [  ]☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes [X] ☒ No [  ]☐

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

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. [  ]☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes [  ] ☐ No [X] ☒

The aggregate market value of the 5,521,7887,925,647 voting and non-voting shares of common stock held by non-affiliates of the registrant as of June 29, 201830, 2022 (based on the last reported sales price of such stock on the Nasdaq Capital Market on such date, the last business day of the registrant’s quarter ended June 30, 2018,2022, of $8.89$11.78 per share) was approximately $49.1$93.4 million.

As of March 15, 2019,February 24, 2023, the registrant had 8,471,60811,112,989 shares of common stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Certain portions of the registrant’s definitive proxy statement pursuant to Regulation 14A of the Securities Exchange Act of 1934 for its 20192023 annual meeting of stockholders, which will be filed with the Securities and Exchange Commission within 120 days after the end of the year covered by this report, are incorporated by reference into Part III of this report.

TABLE OF CONTENTS

PART IForward Looking Statements

Certain statements in this Annual Report on Form 10-K (including but not limited to this Item 7 – “Management’s Discussion and Analysis of Financial Condition and Results of Operations”) constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts included in this Annual Report on Form 10-K, including, without limitation, statements regarding the impact of the COVID-19 pandemic on our business, results of operations and financial condition, our future financial position, business strategy, budgets, projected costs and plans and objectives of management for future operations, are “forward-looking” statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “estimate” or “continue” or the negative of such words or variations of such words and similar expressions. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements, and we can give no assurance that such forward-looking statements will prove to be correct. Important factors that could cause actual results to differ materially from those expressed or implied by the forward-looking statements, or “cautionary statements,” include, but are not limited to:

PART I

Item 1. Business

As used in this report, the terms “Lazydays,” the “Company,“the Company,” “Holdco,” “we,” “us,” and “our” refer to Lazydays Holdings, Inc. and its consolidated subsidiaries unless otherwise expressly stated or the context otherwise requires.

Company History

We were formed under the name “AndinaAndina Acquisition Corp. II”II (“Andina”) was originally formed for the purpose of effecting a business combination with one or more businesses or entities. On March 15, 2018, the initial business combination was consummated. As a result, the business of Lazy Days’ R.V. Center, Inc. and its subsidiaries became our business. Accordingly, Lazydays Holdings, Inc. is now a holding company operating through our direct and indirect subsidiaries.

Company History

Andina was formed as an exempted company incorporated in the Cayman Islands on July 1, 2015 for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or other similar business combination with one or more target businesses.

From the consummation of ourthe initial public offering (“IPO”) of Andina until October 27, 2017, we wereAndina was searching for a suitable target business to acquire. On October 27, 2017, a merger agreement was entered into by and among Andina, Acquisition Corp. II (“Andina”), Andina II Holdco Corp. (“Holdco”), a Delaware corporation and wholly-ownedwholly owned subsidiary of Andina (“Holdco”), Andina II Merger Sub Inc., a Delaware corporation and a wholly-ownedwholly owned subsidiary of Holdco (“Merger Sub”), Lazy Days’ R.V. Center, Inc. (and its subsidiaries), a Delaware corporation (“Lazydays RV”), and solely for certain purposes set forth in the merger agreement, A. Lorne Weil (the “Merger Agreement”). The Merger Agreement provided for a business combination transaction by means of (i) the merger of Andina with and into Holdco, with Holdco surviving changing its name to Lazydays Holdings, Inc. and becoming a new public company (the “Redomestication Merger”) and (ii) the merger of Lazydays RVLazy Days’ R.V. Center, Inc. with and into Merger Sub with Lazydays RVLazy Days’ R.V. Center, Inc. surviving and becoming a direct wholly-ownedwholly owned subsidiary of Holdco (the “Transaction Merger” and together with the Redomestication Merger, the “Mergers”). On March 15, 2018, weHoldco held an extraordinary general meeting of ourthe shareholders, at which the Andina shareholders approved the Mergers and other related proposals. On the same date, we closed the Mergers.Mergers were closed. In connection with the Mergers, our business became the business of Lazy Days’ R.V. Center, Inc. and its subsidiaries.subsidiaries became the business of Holdco. As a result of the Mergers, the Company’sour stockholders and the shareholders of Andina became stockholders of Holdco and wethe Company changed the name of Holdco to “Lazydays Holdings, Inc.”

Our BusinessOverview

The CompanyLazydays Holdings, Inc. operates RecreationRecreational Vehicle (“RV”) dealerships across the U.S. and offers a comprehensive portfolio of products and services for RV owners and outdoor enthusiasts. The Company generatesWe generate revenue by providing RV owners and outdoor enthusiasts a full spectrum of RV products: New and pre-owned RV sales, RV-parts and services,service, financing and insurance products, third-party protection plans, after-market parts and accessories, RV rentals and RV camping. The Company provides these offerings through its Lazydays branded dealerships. Lazydays is known nationally as The RV Authority™, a registered trademark that has been consistently used by the Company in its marketing and branding communications since 2013.

The Company believes,camping facilities. We believe, based on industry research and management’sinternal estimates, it operatesthat we operate one of the world’s largest RV dealerships, measured in terms of on-site inventory, located on 126 acres outside Tampa, Florida. The Company also has dealerships located

We strive to create diversification in Tucson, Arizona; Minneapolis, Minnesota; Knoxville, Tennessee;our products, services, brands and Lovelandgeographic locations to reduce dependence on any one manufacturer, reduce susceptibility to changing consumer preferences, manage seasonality and Denver, Colorado. Lazydays offers onemarket risk and maintain profitability. As of the largest selections of leading RV brands in the nation featuringDecember 31, 2022, we operated 18 locations, representing more than 3,000 new and pre-owned RVs. The Company has nearly 400 service bays30 original equipment manufacturers (“OEM’s”) across all locations and has RV parts and accessories stores at all locations. Lazydays also has RV rental fleets in Florida and Colorado and availability to two on-site campgrounds with over 700 RV campsites. The Company welcomes over 500,000 visitors to its dealership locations annually and employs over 800 people at the six facilities. The Company’s dealership locations are staffed with knowledgeable local team members, providing customers access to extensive RV expertise. The Company believes its dealership locations are strategically located in key RV markets. Based on information collected by the Company from reports prepared by Statistical Surveys, these key RV markets (Florida, Colorado, Arizona, Minnesota and Tennessee) account for a significant portion of new RV units sold on an annual basis in the U.S. The Company’s dealerships in these key markets attract customers from all states, except Hawaii.11 states.

The Company attracts new customers primarily through Lazydays dealership locations as well as digital and traditional marketing efforts. Once the Company acquires customers through a transaction, those customers become part of the Company’s customer database where the Company leverages customized customer relationship management (“CRM”) tools and analytics to actively engage, market and sell its products and services.Business Strategy

Recent Developments

On December 6, 2018, Lazydays completed its asset purchase of Tennessee RV Supercenter near Knoxville, Tennessee. The assets and liabilities purchased consisted primarily of inventory, accounts receivable, equipment, accounts payable, floor plan liabilities, and the certificates, permits, approvals and licenses pertaining to the dealership properties. The total consideration paid for the net acquired assets was $24.7 million consisting of cash, the acquisition of the floor plan liabilities (which is included as a component of net assets acquired in Note 3 to the accompanying consolidated financial statements), and a note due to the owner of Tennessee RV (the “Seller Note”). The Seller Note of approximately $4.1 million accrues interest at a rate of 5.0% per annum, and in the case of an event of default, increases to 8.0% per annum until the event of default is cured. Pursuant to the terms of the Seller Note, the Company shall make monthly payments of principal and interest of approximately $0.1 million through the fourth anniversary of the Seller Note at which time any residual accrued principal and interest shall be due and payable. Additionally, the purchase price is subject to a final net working capital adjustment after the closing date. If the final net working capital exceeds the estimated net working capital adjustment threshold, the Company shall pay to the seller such excess and if the final net working capital is less than the estimated net working capital adjustment threshold, the amount of such deficiency will be set-off against the next required payment under the Seller Note.

Also on December 6, 2018, LDRV Holdings Corp., Lazydays RV America, LLC, Lazydays RV Discount, LLC, Lazydays Mile HI RV, LLC, and Lazydays of Minneapolis LLC (the “Borrowers” pursuant to the credit agreement, dated as of March 15, 2018 (the “Credit Agreement”), as amended pursuant to the First Amendment to the Credit Agreement, dated as of June 30, 2018 with Manufacturers and Traders Trust Company (“M&T Bank”)) entered into the Second Amendment to the Credit Agreement (“Second Amendment”) with M&T Bank. The Second Amendment increases the Letter of Credit Sublimit from $0.5 million to $1.0 million, increases the dollar limit on unsecured indebtedness from $5.0 million to $15.0 million, and makes certain other amendments to the Credit Agreement.

During December 2018, the Company consolidated its six acre operation located in Longmont, CO into its nearby Loveland, CO location. The costs associated were not material to the consolidated statements of operations.

During January 2019, we exchanged $0.5 million to purchase an aggregate of 400,000 unit purchase options as permitted under the terms of the unit purchase options, and as a result the unit purchase options and any obligation to issue any underlying securities were cancelled. See Note 16 to the accompanying consolidated financial statements for additional information.

Company Strengths

The Iconic Brand. With over forty years of history dating back to 1976, Lazydays is an iconic industry leading brand that we believe is synonymous with the RV lifestyle, and is known nationally as The RV Authority^TM®, a registered trademark. The trademark has been consistently used by the CompanyWe seek to provide customers with a seamless online and in its marketing and branding communications since 2013. Based on a research report prepared by Russell Research in November / December 2017, Lazydays is the second most well-known R.V. dealership brand among a national audience of non-Lazydays customers surveyed. According to the report, over 85% of Lazydays customers and over 80% of prospective customers surveyed believe that Lazydays is among the category leaders in the industry. The Company’s consistent quality, breadth and depth of offerings, as well as its comprehensive range of RV lifestyle resources, have resulted in the Company’s customers having loyalty to and trust in the Company’s brands.

Comprehensive Portfolio of Products, Services and Protection Plans. The Company is a provider of a comprehensive portfolio of products, services, third-party protection plans, and resources for RV enthusiasts. The Company offers more than 40,000 products and services through Lazydays dealership locations. The Company’s offerings are based on more than four decades ofstore experience, and feedback from RV enthusiasts.

Customer Experience. Lazydays’ target customers aretargeting RV enthusiasts who are seeking a lifestyle centered around the RV.RV. Lazydays believes it has built its reputation on providing an outstanding customer experience with exceptional service and product expertise. One of the Company’sour primary goals is to create “Customers for Life” by offering a unique purchasing experience that combines aour large selection of new and used RV inventory with a nationwide team of experienced sales and service, customer-focused professionals.

Our long-term strategy to create value for our customers, employees and shareholders includes the Company’s unique scenic facilitiesfollowing:

Driving Operational Excellence Across Our Existing Stores

We are focused on improving performance through increasing market share and profitability at each of our locations. By promoting an entrepreneurial model, we are building strong businesses responsive to each of our local markets. Utilizing performance-based action plans, we strive to drive operational performance and develop high-performing teams. We believe our strong brands, market position, ongoing investment in our service platform, broad product portfolio and full array of RV offerings will continue to provide us with multiple amenitiesa competitive advantage in targeting and its customercapturing a larger share of consumers, including the growing number of new RV enthusiasts that we believe are entering the market. We continuously work to attract new customers to our dealership locations through targeted integrated digital and traditional marketing efforts, attractive offerings, and access to our wide array of resources for RV enthusiasts. The Company has focused process-oriented approach to servicing the customer. Building a welcoming atmosphere that catersspecifically on marketing to the fast-growing RV enthusiast community is an intangible element critical to the Company’s success,demographics of Baby Boomers, Gen X and the Company’s philosophy is thoroughly ingrained in and continually reinforced throughout its corporate culture at every level. As per a research report prepared by Russell Research in November / December 2017, over 70% of Lazydays’ customers and over 60% of prospective customers surveyed strongly agree that Lazydays provides a high quality customer experience.Millennials. The Company believesalso markets to these segments through RV lifestyle-focused partnership and sponsorship efforts.

Our performance-based culture is geared toward an incentive-based compensation structure for a majority of our personnel. We develop pay plans that its customer-focused business model has resultedare measured upon various factors such as customer satisfaction, profitability and individual performance metrics. These plans serve to reward team members for creating exceptional customer experiences, customer loyalty and achieving store potential. This approach allows us to mitigate fluctuations in RV sales and general economic conditions.

Growth Through Acquisitions and Greenfields

The RV industry is highly fragmented with primarily independent dealers. We target increasing our physical network of stores through acquisitions to strategically grow our presence and create density in our network to provide convenience for our customers across the country. Our value-based acquisition strategy targets underperforming stores with strong brands in desirable markets. As we integrate these stores into our network, we focus on increasing profitability through gaining market share, elevating the customer experience and leveraging our cost structure.

In addition to acquisitions, we will, from time to time, open greenfield sites in new or existing markets. We are currently on track to open four future greenfield sites located in the following markets: Council Bluffs, Iowa; Fort Pierce, Florida; Wilmington, Ohio; and Surprise, Arizona.

Leveraging Our Scale and Cost Structure to Create Operational Efficiencies

As we grow, we are positioned to leverage our scale to improve operating margins. We have centralized many administrative functions to drive efficiencies and streamline store-level operations. The reduction of administrative functions at our stores allows our local teams to focus on customer-facing opportunities to increase revenues and gross profit. Our stores also receive supply chain management support, ensuring optimal levels of new and used RV inventory; and finance and insurance product and training support to provide a loyal, stable and growing customer base as well as a strong reputation within the RV community.full array of offerings to our customers.

Employee Service and Commitment. Lazydays’ Tampa location has been recognized as a “Top 50 RV Dealer” by RVBusiness. Lazydays believes its position as a top-rated dealer and workplace has been cultivated over decades, is very difficult

Community Involvement

We are committed to replicate, and is a significant competitive advantage.

making an impact in our communities. In 2005, Lazydays’Lazydays employees startedformed the Lazydays Employee Foundation (the “Foundation”), a 501(c)(3) non-profit organization focused on making a positive impact in the lives of at-risk children. The Foundation is run exclusively by employees as volunteers and members of the Foundation’s board of directors, and their mission is to measurably change the lives of children by instilling hope, inspiring dreams and empowering them with education. Since its inception, the Foundation has donated more than $1.6$2.5 million to help disadvantaged children in Florida, Arizona, Colorado, Minnesota and Minnesota.Tennessee. The Foundation recently donated approximately $0.4 million to help createsponsors two facilities in Florida that carry its name; The Lazydays House at a Kids Place which houses foster children in a facility where siblings can remain together and the first long term care facility in the Tampa Bay area for girlsLazydays House at Bridging Freedom which houses and rehabilitates children rescued from human trafficking. Lazydays’The Foundation also provides financial contributions to other smaller community programs that benefit at-risk youth by providing educational tutoring, expression through the arts, and education scholarships. Lazydays employees also volunteer on small building projects, perform repair work for group homes or homeless shelters, cook and feed the needy,their time to many worthwhile charities and engage in life enriching activities with at-risk youth. The Foundation has received the 2016 Olin Mott Golden Heart award and was also recognized with A Kid’s Place Guardian Angel Award. In 2017, the Foundation was awardedmultiple awards for their philanthropic work, including the national Arthur J. Decio Humanitarian Award for outstanding civic and community outreach in the RV industry.

Leading Market Position and Scale. Lazydays believes it is one of the largest RV retailers in the United States. As per a research report prepared by Russell Research in November / December 2017, Lazydays is the second most well-known RV brand among the national audience. The Company’s scale and its long-term stability make it attractive to the Company’s original equipment manufacturers (“OEMs”), suppliers, financiers and business partners. The Company believes its strong relationship with OEMs and suppliers enables the Company to negotiate attractive product pricing and availability. The Company also aligns with its OEMs on product development in which the Company leverages its customer base to provide feedback on new products. The Company believes its scale and strong relationship with its financing and insurance partners enables it to offer extensive financing products and insurance plans that fit almost every customer’s needs.

Consistent Processes and Procedures. Lazydays utilizes a system of process documentation and implementation called the “Lazydays Way.” Lazydays believes that the Lazydays Way allows it to implement and maintain very efficient and consistent operating procedures across all of its dealerships.

Variable Cost Structure and Capital Efficient Model. Lazydays’ decentralized and flat management structure coupled with incentive programs focused on profitability have allowed Lazydays to achieve a highly variable cost structure. The Company’s digital marketing and analytics capabilities provides it with significant flexibility and meaningfully improves its marketing productivity and efficiency via targeted marketing programs. The Company believes its operating model leads to strong and stable margins through economic cycles, resulting in what it believes to be high cash flow generation, low capital expenditure requirements and strong returns on invested capital.

Experienced Team. Lazydays’ management team has extensive dealership and industry, experience. The Company offers highly competitive compensation tightly tied to performance, which has allowed the Company to attract and retain its highly capable team.

Lazydays Product and Service Offerings

New and Used Vehicles

New Vehicles: Lazydays offers a comprehensive selection of new RVs across almost the entire range of price points, classes and floor plans, from entry level travel trailers to Class A diesel pushers, at its dealership locations and on its website. Lazydays has formed strategic alliances with leading RV manufacturers. The core brands that the Company sells, representing 92.1% of the new vehicles that were sold by the Company in 2018, are manufactured by Thor Industries, Winnebago Industries, Forest River, Inc., and Tiffin Motorhomes.

Used Vehicles: Lazydays sells a comprehensive selection of used RVs at its dealership locations. The primary source of used RVs is through trade-ins associated with the sale of new and used RVs. Lazydays is also very active in the used RV market and its extensive RV knowledge and experience allows Lazydays to buy used RVs at attractive prices. Used RVs are generally reconditioned in the Company’s service departments prior to sale. Used RVs that do not meet the Company’s standards for retail sale are wholesaled.

Dealership Finance and Insurance

Vehicle financing: Lazydays arranges for financing for vehicle purchases through third-party financing sources in exchange for a commission payable to it. Lazydays does not directly finance its customers’ purchases, and its exposure to loss in connection with these financing arrangements generally is limited to the commissions that it receives. For the year ended December 31, 2018 and the year ended December 31, 2017, the Company arranged financing transactions for a majority of the total number of new and used units sold.

Protection Plans:Lazydays offers a variety of third-party protection plans and services to the purchasers of its RVs as part of the delivery process, including extended vehicle service contracts, tire and wheel protection, guaranteed auto protection (known as “GAP”, this protection covers the shortfall between a customer’s loan balance and insurance payoff in the event of a casualty) and property insurance. These products are primarily underwritten and administered by independent third parties. Lazydays is primarily compensated on a straight commission basis. The Company may be charged back (“charge-backs”) for financing fees, insurance or vehicle service contract commissions in the event of early termination of the contracts by the customers.

Parts and Services and Other

Repair and Maintenance: In addition to preparing RVs for delivery to customers, Lazydays’ service and repair operations, with nearly 400 service bays, provide onsite general RV maintenance and repair services at all of the Company’s dealership locations. Lazydays employs over 180 highly skilled technicians, with many of them being certified with the Recreational Vehicle Industry Association (“RVIA”) or the National RV Dealers Association (“RVDA”). The Company is equipped to offer comprehensive services and perform OEM warranty repairs for most RV components. The Company also maintains a body shop, cabinet shop, chassis shop and windshield and glass repair shop with specialized equipment and facilities at its Tampa location.

Installation of parts and accessories: Lazydays’ full-service repair facilities enable Lazydays to install all parts and accessories sold at its dealership locations, including, among other items, towing and hitching products, satellite systems, braking systems, leveling systems and appliances. While other RV dealerships may be able to install RV parts and accessories and other retailers may be able to sell certain parts and accessories, Lazydays believes its ability to both sell and install necessary parts and accessories affords the Company a competitive advantage over online retailers and big box retailers that do not have service centers designed to accommodate RVs, and other RV dealerships that do not offer a comprehensive inventory of parts and accessories.

Collision repair: Lazydays offers collision repair services in all markets and the Company’s Tampa, Florida, Tucson, Arizona, Loveland, Colorado, and Knoxville, Tennessee locations are equipped with full body paint booths. Lazydays’ facilities are equipped to offer a wide selection of collision repair services, including fiberglass front and rear cap replacement, windshield replacement, interior remodel solutions and paint work. The Company can perform collision repair services for a wide array of insurance carriers.

Parts and Accessories Store: With sizable parts and accessories inventory, in addition to a fully stocked onsite retail and accessory stores and access through the Lazydays’ networks for hard to find parts, Lazydays provides new and pre-owned RV buyers the option of dealer installed accessories, such as tow hitches, satellite dishes and specialized suspension systems that can be included in each buyer’s financing or aftermarket through the Lazydays retail store footprint. The Company believes that its Tampa, Florida Accessories & More store is among the largest aftermarket parts and accessories stores in the state of Florida.

RV Rentals: Lazydays offers consumers interested in the RV lifestyle a fleet of vehicles available for rent. Lazydays’ rentals offer comprehensive amenities allowing for a more premier camping experience and an introduction to the RV lifestyle. Lazydays offers unlimited mileage and trip planning services and add-ons such as outdoor living, kitchen and linen packages.

RV Campground: Lazydays also operates the Lazydays RV Resort at its Tampa, Florida location. Also knownwell as the Lazydays RV Campground, the Lazydays RV Resort includes amenities designed to allow guests to relax, unwind,Olin Mott Golden Heart Award and enjoy fun activities as a family. The resort offers 300 RV sites with full 50-amp hookups, a full-time activities coordinator, sports courts, trolley service to and from the Lazydays dealership, and a screened and heated pool. The resort also offers rental units that can comfortably accommodate up to 6 people with one and a half bathrooms, full indoor and outdoor kitchens and other amenities. The resort also operates on-site restaurants.several WEDU Be More awards.

Growth Strategy

Grow the Company’s Customer Base. Lazydays believes its strong brands, market position, ongoing investment in its service platform, broad product portfolio and full array of RV offerings will continue to provide it with competitive advantages in targeting and capturing a larger share of consumers in addition to the growing number of new RV enthusiasts that will enter the market. The Company continuously works to attract new customers to its dealership locations through targeted integrated digital and traditional marketing efforts, attractive offerings and access to its wide array of resources for RV enthusiasts. The Company has focused specifically on marketing to the fast-growing demographics of retiring baby boomers and younger millennial and Generation X market entrants. The Company also markets to these segments through partnership marketing efforts and its sponsorships of college and professional athletic events, music festivals, motorsports events, RV campsites across the country, and other RV lifestyle efforts.

Dealership Location Acquisitions. The RV dealership industry is highly fragmented with many independent RV dealers. The Company has used, and plans to continue to use, acquisitions of independent dealers as an alternative to new dealership location openings to expand its business and grow the Company’s customer base. Lazydays believes its experience and scale allow it to operate acquired locations efficiently. During 2018, Lazydays acquired Shorewood RV Center in Minneapolis, Minnesota and Tennessee RV Supercenter near Knoxville, Tennessee. Lazydays intends to continue to pursue acquisitions that will grow its customer base and present attractive risk-adjusted returns and significant value-creation opportunities.

Greenfield Dealership Locations. Lazydays may establish dealership locations in new and existing markets to expand its customer base. Target markets and locations are identified by employing proprietary data and analytical tools. The Company believes there is ample white space for additional development opportunities. The Company intends to open greenfield sites that will grow its customer base and present attractive risk-adjusted returns and significant value-creation opportunities.

Service and Collision. Lazydays believes that its service and repair capabilities represent a significant opportunity for incremental revenue growth, especially as the Company grows geographically. Lazydays frequently welcomes customers who travel from across the country to have their vehicles serviced by Lazydays’ team of service and repair professionals. As a result, the service and repair department serves as a means of attracting potential customers to the Lazydays facilities and offers greater additional sales opportunities for Lazydays.

Parts and Accessories Store “Accessories & More”. Aftermarket RV parts and accessories are typically under-represented at RV dealerships. The Company believes that parts and accessories are an important part of the RV lifestyle and serve to engage customers with the Lazydays brand outside of the typical RV buying and servicing cycle. The Company understands that RV owners need a reliable resource for RV necessities and products that make their camping experience more enjoyable. Lazydays stores have expansive offerings and provide access to RV product experts to assist RV owners in their RV lifestyle needs. Lazydays believes that the “Accessories & More” offering encompasses all of the needs of the RV consumer.

RV Rentals. Renting RVs continues to grow in popularity as a cost-effective vacation alternative. Lazydays has a fleet of vehicles available for rental at 3 dealership locations, one in Florida and two in Colorado. The Company’s rental vehicles have a robust amenity offering and the Company’s value proposition includes unlimited mileage, add-ons and trip planning for consumers resulting in a superior rental experience. Lazydays believes that RV rentals drive interest in the RV lifestyle and provides an opportunity to introduce new customers to the Lazydays brand. Lazydays is well positioned to take advantage of this growing opportunity.

Leverage the Company’s scale and cost structure to improve operating efficiency. As Lazydays grows, it is positioned to leverage its scale to achieve competitive operating margins. The Company manages its new and used RV inventories so that its dealerships’ supply and mix of vehicles are in line with seasonal sales trends and minimize the Company’s carrying costs. In addition, the Company leverages its scale to reduce costs related to purchasing certain equipment, supplies, and services through national vendor relationships.

Customers and Markets

The RV industry is characterized by RV enthusiasts’ investment in, and steadfast commitment to, the RV lifestyle. The estimated number ofApproximately 11 million U.S. households thatare estimated to own an RV is approximately 9 million.RV.

Owners invest in insurance, extended service contracts, parts and accessories, roadside assistance and regular maintenance to protect and maintain their RVs. They typically invest in new accessories and the necessary installation costs as they upgrade their RVs. They also spend on services and resources as they plan, engage in, and return from their road trips. Furthermore, based on industry research and management’s estimates, the Company believeswe believe that RV owners typically trade-in to buy another RV every four to five years.

Per the RV Industry Association’s (RVIA) December 20182022 survey of manufacturers, total RV wholesale shipments ended 2018 with 483,672 units,2022 at 493,268, down (-4.1%)17.8% compared to the 504,599600,240 units in 2017. The shipment total for 2018 was the second highest on comparable record.2021. Towable RVs were down (-3.6%)20.1% at 426,087 units;434,858 from 544,028 units and motorhome shipments were down (-8.1%)up 3.9% at 57,58558,410 units compared to 2017 shipment totals.from 56,212 units in 2021. Per the RVIA survey, 2022 ended with the third best year on record of wholesale shipments. Generally, usedpre-owned RVs are sold at a lower price levelpoint than comparable new RVs and the sale of usedpre-owned RVs has historically been more stable through business cycles than the sale of new vehicles.vehicles through business cycles.

Lazydays believesWe believe RV trips remain one of the least expensive typetypes of vacation, and allowallowing RV owners to travel more while spending less. RV trips offer savings on a variety of vacation costs, including, among others, airfare, lodging, pet boarding and dining. While fuel costs are a component of the overall vacation cost, the Company believeswe believe fluctuations in fuel prices are not a significant factor affecting a family’s decision to take RV trips. Based on RVIA information, the average annual mileage use of an RV is between 3,000 and 5,000 miles. In addition, our customer research indicates that customers are attracted to RV ownership based on the comfortable and convenient travel it provides.

Competition

The Company believesWe believe that the principal competitive factors in the RV industry are breadth and depth of product selection, value pricing, convenient dealership locations, quality technical services, customer service, and overall experience. The Company competesWe compete directly and/or indirectly with RV dealers, RV service providers, RV rental operators, and RV parts and accessories retailers. One of the Company’sour direct competitors, Camping World Holdings, Inc., is publicly listed on the New York Stock Exchange. Additional competitors may enter the businesses in which the Companywe currently operates.operate.

Lazydays RV Dealerships

The Company operates six Lazydays dealership locations across five states. The Company’s dealership locations are strategically located in key RV markets. Based on information collected by the Company from reports prepared by Statistical Surveys, these key RV markets of Florida, Colorado, Arizona, Minnesota and Tennessee account for a significant portion of new RV units sold on an annual basis in the U.S. The Company’s dealerships in these key markets attract customers from all states, except Hawaii. Generally, the Company’s dealership locations provide RV repair and installation services, collision repair, parts, and accessories for RVs and RV enthusiasts, RV rentals and all of the Company’s locations sell new and used RVs. The Company believes its dealership strategy of offering a comprehensive range of RV parts, services, accessories, products, rentals and new and used RVs, generates powerful cross-selling opportunities.

Dealership Design and Layout

The Company’s operating dealership locations range in size from approximately 14,000 to 384,000 square feet and are situated on 11 to 126 acres. The Company’s dealership locations feature service centers staffed with expert, in-house trained product specialists and are equipped with merchandise demonstrations to assist in educating customers about RV performance products. The Company’s dealership locations also provide opportunities to promote a more interactive and consultative selling environment. The Lazydays staff is trained to cross-sell and explain the benefits of the Company’s breadth of services, protection plans and products to which the Company’s customers have become accustomed, such as extended service contracts, emergency roadside assistance products, club memberships, discount camping and travel assistance.

The Company regularly refreshes its dealership locations to enhance the customers’ shopping experience and maximize product and service offerings. New products and services are introduced to capitalize on the advances of the RV industry and to satisfy needs of the Company’s customers. Store dress, promotional signage and directional signage are also periodically refreshed to further enhance the Lazydays customer shopping experience at Lazydays dealership locations.

Expansion Opportunities and Site Selection

The Company’s disciplined expansion and acquisition strategy focuses on growing its geographic footprint and customer base. The Company believes it has developed a rigorous and flexible process that employs exclusive data and analytical tools to identify target markets for acquisitions and new dealership openings. The Company evaluates acquisition opportunities or selects sites for new locations based on criteria such as local demographics, traffic patterns, proximity to RV parks and campgrounds, proximity to major interstates, analytics from the Company’s customer database, RV sales and registrations, product availability and availability of attractive acquisition and/or lease terms. Members of the Lazydays development team spend considerable time evaluating markets and prospective sites.

Dealership Management and Training

The Company’s Vice President, National General Manager oversees all dealership operations. He has over 38 years of experience in the RV industry and has been employed by Lazydays for over 5 years.

Each dealership location employs a General Manager or a General Sales Manager (in either case, the “GM”) that has responsibility for the daily operations of the dealership location. Areas of responsibility include inventory management, hiring, associate training and development, maintenance of the facilities, customer service and customer satisfaction. A GM’s management team includes a sales manager, a parts and accessories manager, a service manager, and a finance and insurance manager to help oversee the operations of each dealership location department. A typical Lazydays dealership location employs approximately 30 to 100 full-time equivalent employees.

The Company employs a Vice President, Operations and Supply Chain, and a centralized inventory management team to oversee the Company’s RV inventory and provide consistency and controls in the forecasting, ordering, purchasing and distribution of RV inventory.

The Company employs a Vice President of Service who has responsibility for the service operations of the dealership locations. His responsibilities include ensuring efficiency, logistics, and scheduling of service operations to deliver a premium customer experience.

The Company is constantly seeking to add top talent by partnering with local school districts, trade schools, military bases and community organizations. The interview process identifies current and future candidates with the goal of hiring talented people that are customer focused. The Company identifies hard to fill positions and has taken a proactive approach to creating viable candidates with its Tech U and Sales U programs. Through its Tech U and Sales U programs, the Company enrolls students with technical aptitude and provides them training to successfully complete industry certification courses and prepare them for a career as an RV technician or a successful sales partner.

Once hired, the Company continues to provide extensive training programs and opportunities for its employees, including, among others, new-hire training and orientations, institutionalized monthly e-learning and training modules, and certification programs for the Company’s RV technicians.

Product Sourcing and Distribution

Sourcing

New and Used RVs

The Company generally acquires new RVs for retail sale directly from the applicable manufacturer. Lazydays has strategic contractual arrangements with many of the leading RV manufacturers. Lazydays maintains a central inventory management and purchasing group to manage and maintain adequate inventory levels and mix. RVs are transported directly from a manufacturer’s facility to Lazydays dealership locations via a third-party transportation company.

Lazydays’ strategy is to partner with financially sound manufacturers that make quality products, have adequate manufacturing capacity and distribution, and maintain an appropriate product mix.

Lazydays’ supply arrangements with OEMs are typically governed by dealer agreements, which are customary in the RV industry. The Company’s dealer agreements with OEMs are generally made on a location-by-location basis. The terms of these dealer agreements are typically subject to Lazydays, among other things, meeting all the requirements and conditions of the dealer agreement, maintaining certain sales objectives, performing services and repairs for owners of the manufacturer’s RVs that are still under manufacturer warranty, carrying the manufacturer’s parts and accessories needed to service and repair the manufacturer’s RVs in stock at all times, actively advertising and promoting the manufacturer’s RVs and indemnifying the manufacturer under certain circumstances. Lazydays’ dealer agreements generally designate a specific geographic territory, exclusive to Lazydays, provided that Lazydays meets the material obligations of the dealer agreement. Wholesale pricing is generally established on a model year basis and is subject to change in the manufacturer’s sole discretion. In certain cases, the manufacturer may also establish a suggested retail price, below which the Company cannot advertise that manufacturer’s RVs.

Lazydays generally acquires used RVs from customers, primarily through trade-ins, as well as through private sales, auctions, the Company’s rental inventory and other sources, and the Company generally reconditions used RVs acquired for retail sale in its parts and service departments. Used RVs that Lazydays does not sell at Lazydays dealership locations generally are sold at wholesale prices through auctions.

Lazydays finances the purchase of substantially all of the Company’s new RV inventory from OEMs through the floor plan facility. Used vehicles may also be financed from time to time through the floor plan facility. For more information on the floor plan facility, see“Management’s Discussion and Analysis of Financial Condition and Results of Operations — M&T Credit Facility” below.

Parts and Accessories

The purchasing activities for the Company’s parts and accessories departments are focused on RV maintenance products, outdoor lifestyle products, RV parts and accessories, such as, among other things, generators and electrical, satellite receivers and GPS systems, towing and hitching products and RV appliances, essential supplies and other products and services necessary or desirable for the RV lifestyle. The Company maintains central purchasing functions to manage inventory, product-planning, allocate merchandise to the Company’s dealership locations and oversee the replenishment of basic merchandise. The Company has no long-term purchase commitments. The Company leverages its scale to reduce costs related to purchasing certain equipment, supplies, and services through long-standing, continuous relationships with its largest vendors.

Marketing and Advertising

The Company markets itsWe market our product offerings through integrated marketing campaigns across all digital and traditional marketing disciplines, with an emphasis on digital. The Company’sOur marketing efforts include itsour website, paid and organic search efforts, email, social media, online blog and video content, television, radio, billboards, direct mail, telemarketing, retail point of sale, promotional events,and RV shows and rallies, advertisements in nationalrallies. We also have exclusive partnership and regional industry publications, vendor co-op advertising programs and personal solicitations and referrals. Lazydays also has numerous exclusive sponsorship and partnership relationships with various RV lifestyle properties and events, including college sports teams, National Football League teams, music festivals, RV campsites across the country, motorsports events, and others. The Companyproperties. We currently hashave a segmented marketing database of over 3.22.5 million RV owners and prospects. Lazydays’Our principal marketing strategy is to capitalize on its broad name recognition,leverage our unique brand positioning, extensive product selection, differentiated value proposition and exclusive benefits, and high quality customer experience among RV owners. As per a research report prepared by Russell Research in November / December 2017, over 70% of Lazydays customers and over 60% of prospective customers surveyed strongly agree that Lazydays provides a high quality customer experience.

The Company uses data-driven marketing methods and reviews results by marketing discipline and campaign, by geographic market and by business on an ongoing basis to enhance and update the Company’s efforts to optimize its marketing effectiveness and productivity.

The Company currently operates an extensive responsive RV lifestyle-related website that we believe provides an exceptional user experience on all types of digital devices. The Company’sOur total website traffic for the year ended December 31, 20182022 was approximately 7.828.1 million visits with approximately 4.027.6 million unique visitors. The LazydaysOur website features over 3,0006,000 new and preownedpre-owned RVs, as well as information regarding Lazydays’our RV financing and insurance products, service capabilities, RV rentals, parts and accessories Lazydays’ RV resort, and RV seminars and classes schedule. The Lazydays website also includes The RV Authority^TM blog, video content, RV trip planningofferings, and other RV lifestyle associated content. The Lazydays website

We measure our marketing productivity and many other digitaleffectiveness with front end analytics integrated with 1^st party data to optimize marketing efforts provide RV owners and enthusiasts with the most expansive access to RV related content in the industry.efforts.

Customer Service

Lazydays strives to exceed expectations by providing the best overall customer experience throughout every interaction with the Company. The Company believes customer service and access to a live person is a critical component of Lazydays’ digital marketing, sales, service and rental operations, and to achieving a best-in-class customer experience. The Company’s sales and customer service centers are multi-channel, full-service contact centers. RV enthusiasts can visit Lazydays’ locations, call, email, internet chat, text and use social media to contact Lazydays regarding products, services, protection plans, rentals, concerns and anything else related to the RV lifestyle. RV enthusiasts can also speak with Lazydays’ customer service specialists for help with aftermarket accessory orders, installations, scheduling, answers to questions, and to make purchases for any product and install services offered through the Lazydays website.

Lazydays’ contact center specialists are extensively trained to assist customers with complex orders and provide a level of service that leads to long-term customer relationships. In addition, Lazydays’ quality assurance team monitors contacts daily and provides the leadership team with tools to maintain sales and service standards. With low turnover, the Company retains employees longer than the industry average, which the Company believes allows its callers to be assisted by experienced contact center agents who are familiar with the RV lifestyle and Lazydays’ services, protection plans and products.

Management Information Systems

The Company utilizes multiple computer systems to support its operations, including a third-party dealer management system (“DMS”), point-of-sale registers (“POS”), enterprise resource planning system, supply chain, CRM system, rental reservation system, marketing database and other business intelligence tools. In addition, the Company utilizes proprietary systems and data warehouses to provide analytical views of its data.

To support the applications, the Company has multiple data centers and cloud services with advanced servers, storage and networking capabilities, giving the Company the ability to scale quickly to meet demand. The Company has a secure wide area network that facilitates communication within and between its offices and provides both voice and data services. The Company’s business critical systems are replicated in real time and all systems are protected with on and off-site backups.

A database containing all customer activity across the Company’s various businesses and programs has been integrated into its website and contact centers. Comprehensive information on each customer, including a profile of the purchasing activities, is made available to drive future sales. The Company utilizes information technology and analytics to actively market and sell multiple products and services to its customers, including list segmentation and merge and purge programs, to select prospects for email and direct mail solicitations and other direct marketing efforts.

The Company’s management information systems and electronic data processing systems consist of an extensive range of retail, financial and merchandising systems, including purchasing, inventory distribution and logistics, sales reporting, accounts payable and merchandise management. The Company’s POS and dealer management systems report comprehensive data in near real time to the Company’s data warehouses, including detailed sales volume, inventory information by product, merchandise transfers and receipts, special orders, supply orders and returns of product purchases to vendors. The Company can capture associated sales and reference to specific promotional campaigns. Lazydays management monitors the performance of each dealership location to evaluate inventory levels, determine markdowns and analyze gross profit margins by product.

Trademarks and Other Intellectual Property

The Company ownsWe own a variety of registered trademarks and service marks related to itsour brands and itsour services, protection plans, products and resources, including Lazydays, Lazydays The RV Authority^TM®, Lazydays RV Accessories & More, Crown Club, and Exit 10, among others. The CompanyWe also ownsown numerous domain names, including Lazdays.com,Lazydays.com, LazydaysRVSale.com, LazydaysEvents.com, LazydaysService.com, RVPlace.com, and RVListings.com,LazydaysService.com among many others. The Company believesWe believe that itsour trademarks and other intellectual property have significant value and are important to itsour marketing efforts. The Company is not aware of any material pending claims of infringement or other challenges to the Company’s right to use its intellectual property in the United States or elsewhere.

Government Regulation

The Company’sOur operations are subject to varying degrees of federal, state and local regulation, including the Company’sour RV sales, vehicle financing, outbound telemarketing, email, direct mail, roadside assistance programs, extended vehicle service contracts and insurance activities. These laws and regulations include consumer protection laws, so-called “lemon laws,” privacy laws, escheatment laws, anti-money laundering laws, environmental laws and other extensive laws and regulations applicable to new and usedpre-owned vehicle dealers, as well as a variety of other laws and regulations. These laws also include federal and state wage and hour, anti-discrimination and other employment practices laws.

Motor Vehicle Laws and Regulations

The Company’sOur operations are subject to the National Traffic and Motor Vehicle Safety Act, Federal Motor Vehicle Safety Standards promulgated by the United States Department of Transportation and the rules and regulations of various state motor vehicle regulatory agencies. The Company isWe are 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. Federal and state authorities also have various environmental control standards relating to air, water, noise pollution and hazardous waste generation and disposal.

The Company’sOur financing activities with customers are subject to federal truth-in-lending, consumer leasing and equal credit opportunity laws and regulations as well as state and local motor vehicle finance laws, leasing laws, installment finance laws, usury laws and other installment sales and leasing laws and regulations, some of which regulate finance and other fees and charges that may be imposed or received in connection with motor vehicle retail installment sales.

The Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”), which was signed into law on July 21, 2010, established the Bureau of Consumer Financial Protection (“BCFP”BCFP��), an independent federal agency funded by the United States Federal Reserve 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 March 2013, the BCFP issued supervisory guidance highlighting its concern that the practice of automotive dealers being compensated for arranging customer financing through discretionary markup of wholesale rates offered by financial institutions (“dealer markup”) results in a significant risk of pricing disparity in violation of the Equal Credit Opportunity Act (“ECOA”). The BCFP recommended that financial institutions under its jurisdiction take steps to address compliance with the ECOA, which may include imposing controls on dealer markup, monitoring and addressing the effects of dealer markup policies, and eliminating dealer discretion to markup buy rates.

Insurance Laws and Regulations

As a marketer of insurance programs, the Company iswe are subject to state rules and regulations governing the business of insurance including, without limitation, laws governing the administration, underwriting, marketing, solicitation and/or sale of insurance programs. The insurance carriers that underwrite the programs that the Company sellswe sell are required to file their rates for approval by state regulators. 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 offering of any insurance program to a consumer. The Company isWe are required to maintain certain licenses to market insurance programs.

Marketing Laws and Regulations

The Federal Trade Commission (the “FTC”) and each of the states have enacted consumer protection statutes designed to ensure that consumers are protected from unfair and deceptive marketing practices. Lazydays reviewsWe review all of itsour marketing materials for compliance with applicable FTC regulations and state marketing laws.

Environmental, Health and Safety Laws and Regulations

The Company’sOur 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’sour business is subject to a variety of federal, state and local requirements that regulate the environment and public health and safety.

Most of the Lazydaysour dealership locations utilize aboveground storage tanks, and to a lesser extent underground storage tanks, primarily for petroleum-based products. Storage tanks are subject to periodic testing, containment, upgrading and removal requirements under the Resource Conservation and Recovery Act and its state law counterparts. Clean-up or other remedial action may be necessary in the event of leaks or other discharges from storage tanks or other sources. In addition, water quality protection programs under the federal Water Pollution Control Act (commonly known as the Clean Water Act), the Safe Drinking Water Act and comparable state and local programs govern certain discharges from some of the Company’sour operations. Similarly, air emissions from the Company’sour operations, such as RV painting, are subject to the federal Clean Air Act and related state and local laws. Certain health and safety standards promulgated by the Occupational Safety and Health Administration of the United States Department of Labor and related state agencies also apply to certain of the Company’sour operations.

Although the Company incurswe incur costs to comply with applicable environmental, health and safety laws and regulations in the ordinary course of itsour business, the Company doeswe do not presently anticipate that these costs will have a material adverse effect on itsour business, financial condition or results of operations. The Company doesWe do not have any material known environmental commitments or contingencies.

Insurance

The Company utilizesWe utilize insurance to provide for the potential liabilities for workers’ compensation, product liability, general liability, business interruption, property liability, director and officers’ liability, cyber, environmental issues, and vehicle liability andliability. Beginning in 2020, we became self-insured for employee health-care benefits. Liabilities associated with the risks that are retained by the Company are estimated, in part, by considering actuarial reports, historical claims experience, demographic factors, severity factors, stop loss coverage and other assumptions. The Company’sOur results could be adversely affected by claims and other expenses related to such plans and policies if future occurrences and claims differ from these assumptions and historical trends.

Employees

As of December 31, 2018, Lazydays2022, we had approximately 880over 1,400 employees, including approximately 850almost all of which are full-time employees. None of the Lazydaysour employees are represented by a labor union or are party to a collective bargaining agreement, and Lazydays haswe have not had any labor-related work stoppages. The Company believesWe believe that itsour employee relations are in good standing.

Seasonality

Seasonality and Effects of Weather

The Company’s overall

Our operations generally experience modestly higher volumes of vehicle sales in the first half of each year due in part to consumer buying patternstrends and the warmerhospitable warm climate during the winter months at our Florida and Arizona locations. In addition, the Company’snorthern locations in Colorado, Tennessee, Minnesota, Indiana, Oregon, Oklahoma, Washington and Wisconsin generally experience modestly higher vehicle sales during the spring months.

Our largest locationRV dealership is located near Tampa, Florida, which is in Tampa, Florida.

Revenues for eachclose proximity to the Gulf of Mexico. A severe weather event, such as a hurricane, could cause severe damage to property and inventory and decrease the last two fiscal years, fortraffic to our dealerships. Although we believe that we have adequate insurance coverage, if we were to experience a catastrophic loss, we may exceed our policy limits, and/or may have difficulty obtaining similar products and services which accounted for more than 10 percent or more of consolidated revenue are presentedinsurance coverage in the accompanying statements of operations.future.

Principal Executive Offices

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.

Available Information

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, 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 Securities and Exchange Commission (“SEC”). You may also read and copy any materials we file with the SEC at the SEC’s Internet website located at www.sec.gov that contains the information we file or furnish electronically with the SEC.www.sec.gov.

Item 1A. Risk Factors

The following are certainmaterial risks to which our business operations are subject. Any of these risks could materially adversely affect our business, financial condition, or results of operations. These risks could also cause our actual results to differ materially from those indicated in the forward-looking statements contained herein and elsewhere. The risks described below are not the only risks we face. Additional risks not currently known to us or those we currently deem to be immaterial may also materially and adversely affect our business operations.

Risks Related to Lazydays’Lazydays Business

Certain of our warrants are accounted for as liabilities and the changes in the fair values of the warrants could have a material effect on our financial results.

We account for the Private Warrants and PIPE Warrants as liabilities for all periods presented. Prior to the SEC Staff Statement on April 12, 2021, we had previously accounted for our Warrants as components of equity, consistent with common market practice. Under liability accounting treatment, we are 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 our 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, through March 2023 when our warrants expire, 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.

A material weakness in our internal control over financial reporting related to our information technology systems was determined to exist. If we are unable to maintain an effective system of internal controls, we may not be able to accurately report our financial results, which could lead to a loss of investor confidence in our financial statements and have an adverse effect on our stock price.

As of December 31, 2022, management identified a material weakness in internal controls related to ineffective information technology general controls. The Company’smaterial weakness did not result in any identified misstatements to the financial statements and there were no changes to previously released financial results. Management has developed and implemented a remediation plan to address the material weakness. However, we cannot assure you that the testing of the operational effectiveness of the new control will be complete within a specific timeframe. 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 (the “Sarbanes-Oxley Act”). 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.

Natural disasters, whether or not caused by climate change, unusual weather conditions, epidemic and pandemic outbreaks, terrorist acts and political events could disrupt business and result in lower sales and otherwise adversely affect our financial performance.

The occurrence of one or more natural disasters, such as tornadoes, hurricanes, fires, floods, hail storms and earthquakes, unusual weather conditions, epidemic and pandemic outbreaks such as Coronavirus, or other global health emergencies, terrorist attacks or disruptive political events in certain regions where our stores are located could adversely affect our business and result in lower sales. Severe weather, such as heavy snowfall or extreme temperatures, may discourage or restrict customers in a particular region from traveling to our dealerships or utilizing our products, thereby reducing our sales and profitability. Natural disasters including tornadoes, hurricanes, floods, hail storms and earthquakes may damage our stores or other operations, which may materially adversely affect our financial results. Any of these events could have a material adverse effect on our business, financial condition and results of operations.

Our business is affected by the availability of financing to itus and itsour customers.

The Company’sOur business is affected by the availability of financing to itus and itsour customers. Generally, RV dealers including the Company, finance their purchases of inventory with financing provided by lending institutions. On March 15, 2018, the CompanyJuly 14, 2021, we entered into a $369.1 million amended and restated credit agreement with M&T Bank including a new floor plan facility with M&T Bank whichthat increased the committed floor plan financing to $175.0$327.0 million. As of December 31, 2018, the Company2022, we had $143.9$349.1 million outstanding under itsthe M&T floor plan facility and $17.8$7.2 million outstanding under the M&T term loan. As of December 31, 2018,2022, substantially all of the invoice cost of new RV inventory and 4.2% of book value of used 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 Companyus from carrying adequate levels of inventory, which may limit product offerings and could lead to reduced sales and revenues.

Furthermore, manymost of the Company’sour customers finance their RV purchases. Although consumer credit markets are generally favorable, consumerConsumer credit market conditions, including rising interest rates, 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’sour 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’sour products and have a material adverse effect on the Company’sour business, financial condition and results of operations.

Fuel shortages,Climate change legislation or high prices for fuel,regulations restricting emission of “greenhouse gases” could have a negative effect on the Company’s business.

Gasoline or diesel fuel is requiredresult in increased operating costs and reduced demand for the operationRVs we sell.

The United States Environmental Protection Agency has adopted rules under existing provisions of RVs. There can be no assurancethe federal Clean Air Act that the supplyrequire a reduction in emissions of these petroleum products will continue uninterrupted, that rationing will not be imposedgreenhouse gases from motor vehicles. The Biden Administration has focused significant attention on greenhouse gases and climate change. The adoption of any laws or that the price ofregulations requiring significant increases in fuel economy requirements or taxnew federal or state restrictions on these petroleum products will not significantly increasevehicles and automotive fuels in the future. Shortages of gasolineUnited States or internationally could adversely affect demand for those vehicles 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’sour business, financial condition orand results of operations.

The Company’sOur success will dependdepends to a significant extent on the well-being, as well as the continued popularity, financial condition and reputation for quality, of the Company’sour manufacturers, particularly Thor Industries, Inc., Tiffin Motorhomes, Winnebago Industries, Inc., and Forest River, Inc., as well as their respective supply chains.

Thor Industries, Inc., Tiffin Motorhomes, Winnebago Industries, Inc., and Forest River, Inc. supplied approximately 29.0%49.1%, 28.1%, 17.6%29.1%, and 17.2%18.3%, respectively, of the Company’sour purchases of new RV inventory during the year ended December 31, 2018. The Company depends2022. We depend on itsour manufacturers to provide itus 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’sour manufacturers or their respective supply chains could have a substantial adverse impact on the Company’sour business. Any difficulties encountered by any of the Company’sour manufacturers resulting from economic, financial, or other factors could adversely affect the quality and amountnumber of products that they are able to supply to the Companyus and the services and support they provide to the Company.

us. The interruption or discontinuance of the operations of the Company’sour manufacturers or their respective supply chains could cause the Companyus to experience shortfalls, disruptions, or delays with respect to needed inventory. Although the Company believeswe believe 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’sour customers.

Any change, non-renewal, unfavorable renegotiation or termination of the Company’sour supply arrangements for any reason could have a material adverse effect on product availability and cost and the Company’sour financial performance.

The Company’sOur supply arrangements with manufacturers are typically governed by dealer agreements, which are customary in the RV industry. The Company’sOur 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’sour dealer agreements are typically subject to: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’sOur dealer agreements designate a specific geographicalgeographic territory for the Company, exclusive to the Company,us, provided that the Company iswe are able to meet the material obligations of the applicable dealer agreement.

In addition, many of the Company’sour 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. In certain cases, the manufacturer may also establish a suggested retail price, below which the Company cannot advertise that manufacturer’s RVs. 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’sour 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:

Decreases in the number of customers, average spend per customer or retention and renewal rates for the Company’s 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 U.S. economy, 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 U.S. 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 in large part upon the Company’s ability to attract and retain customers for its products, services, protection plans, and resources. The extent to which the Company achievesOur 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 the external 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.

Competition in the market for services, protection plans and products targeting the RV lifestyle or RV enthusiast could reduce the Company’s revenues and profitability.

The market for services, protection plans and products targeting the RV lifestyle or RV enthusiast is highly fragmented and competitive. Competition in the RV market is 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 used 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 services, protection plans and products 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 could have a material adverse effect on the Company’s business, financial condition and results of operations.

Some of the Company’s existing competitors have, and some of the Company’s future competitors may have, greater financial, personnel, and other resources, more well-established brands or reputations and broader customer bases than the Company and, as a result, these competitors may be in a stronger position to respond quickly to potential acquisitions and other market opportunities and changes in customer preferences. Some of these competitors may have customer bases that are more geographically balanced than the Company’s and, therefore, may be less affected by an economic downturn in a particular region or market. Competitors with greater resources also may be able to offer lower prices, additional products or services or other incentives that the Company cannot match or does not offer. Industry consolidations may also create competitors with broader and more geographic coverage.

The Company’s expansion into new, unfamiliar markets, whether through acquisitions or otherwise, presents increased risks that may prevent it from being profitable in these new markets. Delays in opening or acquiring new retail locations could have a material adverse effect on the Company’s business, financial condition and results of operations.materially affect profitability.

During 2018, the Company acquired Shorewood RV Center in Minneapolis, Minnesota and Tennessee RV Supercenter near Knoxville, Tennessee. In March of 2019, the Company announced that it will open a dealership in Nashville, Tennessee. The Company intends to continue to expand in part by acquiring or building new retail locations in new markets. As a result, the Company 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 brands. Other factors that may impact the Company’s ability to acquire or open new retail locations in new markets and operate them profitably, many of which are beyond the Company’s control, include:

Once the Company decides on a new market and identifies a suitable acquisition or location opportunity, any delays in acquiring or opening or developing new retail locations could impact the Company’s financial results. It is possible that events, such as delays in the acquisitions process or construction delays caused by permitting or licensing issues, material shortages, labor issues, weather delays or other acts of God, discovery of contaminants, accidents, deaths or injuries could delay planned openings or force the Company to abandon planned openings altogether.

As the Company grows, the Company will face the risk that its existing resources and systems, including management resources, accounting and finance personnel and operating systems, may be inadequate to support its growth. There can be no assurance that the Company will be able to retain the personnel or make the changes in its systems that may be required to support its growth. Failure to secure these resources and implement these systems on a timely basis could have a material adverse effect on the Company’s results of operations. In addition, hiring additional personnel and implementing changes and enhancements to the Company’s systems will require capital expenditures and other increased costs that could also have a material adverse impact on the Company’s results of operations.

The Company’s expansion into new markets may also create new challenges including an increase in information to be processed by the Company’s information management systems and diversion of management attention from existing operations. To the extent that the Company is not able to meet these additional challenges, the Company’s sales could decrease, and the Company’s operating expenses could increase, which could have a material adverse effect on the Company’s business, financial condition and results of operations.

Finally, the size, timing, and integration of any future new retail location openings or acquisitions may cause substantial fluctuations in the Company’s results of operations from quarter to quarter. Consequently, the Company’s 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’s business, financial condition and results of operations.

As a result of the above factors, there can be no assurance that the Company will be able to operate retail locations in new markets on a profitable basis. The failure to operate retail locations in new markets on a profitable basis could have a material adverse effect on the Company’s business, financial condition and results of operations.

Unforeseen expenses, difficulties, and delays encountered in connection with expansion through acquisitions could inhibit the Company’s growth and negatively impact its profitability.

The Company’sOur success will depend, in part, on 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 cooperation and the sharing of opportunities and resources among the Company’sour retail locations and consumer services and plans. Unforeseen expenses, difficulties and delays encountered in connection with rapid expansion through acquisitions could inhibit the Company’s growth, which could have a negative impact on the Company’s profitability.

Additionally, the Company may be unable to identify suitable acquisition candidates or consummate acquisitions. Increased competition for acquisition candidates or increased asking prices by acquisition candidates may increase purchase prices for acquisitions to levels beyond the Company’s financial capability or to levels that would be unlikely to provide the returns required by the Company’s acquisition criteria. Acquisitions also may become more difficult or less attractive in the future as the Company continues to focus on acquiring what it believes are the most attractive dealers. The Company may incur expenses associated with sourcing, evaluating and negotiating acquisitions (including those that are not completed), and the Company also may pay fees and expenses associated with obtaining financing for acquisitions and with investment banks and others finding acquisitions for the Company. In addition, the Company may encounter difficulties in integrating the operations of acquired dealers with its own operations or managing acquired dealers and stores profitably without substantial costs, delays, or other operational or financial problems. The CompanyWe may not be able to achieve the anticipated operating and cost synergies or long-term strategic benefits of itsour acquisitions within the anticipated timing or at all. For at leastas 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. The Company may also assume liabilities

In 2021, we acquired one dealership in connection with acquisitions that the Company would otherwise not be exposed to.

The Company’s abilityOklahoma. We intend to continue to grow through the acquisition of additionalexpand in part by acquiring or building new retail or service locations will depend upon various factors, including the following:

As a part of the Company’s acquisition strategy, the Company has engaged and will continue to engage in acquisition discussions with various dealerships. In connection with these acquisition discussions, the Company and each potential acquisition candidate exchange confidential operational and financial information, conduct due diligence inquiries, and consider the structure, terms, and conditions of the potential acquisition. Potential acquisition discussions may take place over a long period of time and involve difficult business integration and other issues, including in some cases, management succession, employee transitions and related matters.new markets. As a result of thesethis and otherany 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 and our brands.

Other factors, many of which are beyond our control, may impact our ability to acquire or open retail locations successfully, whether in existing or new markets, and operate them profitably. These factors include (a) the ability to (i) identify suitable acquisition opportunities at purchase prices likely to provide returns required by our acquisition criteria, (ii) control expenses associated with sourcing, evaluating and negotiating acquisitions (including those that are not completed), (iii) accurately assess the profitability of potential acquisitions that may from timeor new locations, (iv) secure required third party or governmental permits and approvals, (v) negotiate favorable lease agreements, (vi) hire and train skilled operating personnel, especially management personnel, (vii) provide a satisfactory product mix responsive to time appear likely to occur may not be consummated. In addition,local market preferences where new retail locations are built or acquired, (viii) secure product lines, (ix) supply new retail locations with inventory in a timely manner; (b) the Company may haveavailability of construction materials and labor for new retail locations and the occurrence of significant construction delays or cost overruns; (c) competitors in the same geographic area and regional economic variants; (d) the absence of disagreements with potential acquisition targets whichthat could lead to litigation. Anylitigation; (e) successfully integrating the operations of acquired dealers with our own operations; (f) managing acquired dealers and stores profitably without substantial costs, delays, or other operational or financial problems; and (g) the ability of our information management systems to process increased information accurately and in a timely fashion. A negative outcome associated with any of these factors or outcomes could result inhave a material adverse effect on the Company’sour business, financial condition and results of operations.

Once we decide on a new market and identifies a suitable acquisition or location opportunity, any delays in acquiring or opening or developing new retail locations could impact our financial results. For example, delays in the acquisition process or construction delays caused by permitting or licensing issues, material shortages, labor issues, weather delays or other acts of God, discovery of contaminants, accidents, deaths or injuries, third parties attempting to impose unsatisfactory restrictions on the Company in connection with their approval of acquisitions, and other factors could delay planned openings or force us to abandon planned openings altogether.

As we grow, we will face the risk that our existing resources and systems, including management resources, accounting and finance personnel and operating systems, may be inadequate to support our growth.

Finally, the size, timing, and integration of any future new retail location openings or acquisitions may cause substantial fluctuations in our results of operations from quarter to quarter. Consequently, our 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 our business, financial condition and results of operations.

Failure to maintain the strength and value of the Company’sour brands could have a material adverse effect on the Company’sour business, financial condition and results of operations.

The Company’sOur success depends on the value and strength of the Lazydays brands. The Lazydays name and Lazydays’Lazydays brands are integral to the Company’sour business as well as to the implementation of the Company’sour strategies for expanding itsour business. Maintaining, enhancing, promoting and positioning the Company’sour brands, particularly in new markets where the Company haswe have limited brand recognition, will depend largely on the success of the Company’sour marketing efforts and itsour ability to provide high quality products, services, protection plans, and resources and a consistent, high quality customer experience. The Company’sOur brands could be adversely affected if the Company failsif: (a) we fail to achieve these objectives if the Company failsor to comply with local laws and regulations, if the Company isregulations; (b) we are subject to publicized litigationlitigation; or if the Company’s(c) our public image or reputation were to be tarnished by negative publicity. Some of these risks are not within the Company’sour control, such as the effects of negative publicity regarding the Company’sour 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’sour brand image may require the Companyus to make substantial investments in areas such as marketing, dealership operations, community relations, store graphics and employee training, which could adversely affect the Company’sour cash flow.flow and profitability. Furthermore, efforts to maintain, enhance or promote the Company’sour brand image may ultimately be unsuccessful. These factors could have a material adverse effect on the Company’sour business, financial condition and results of operations.

The Company’sOur failure to successfully orderprocure and manage itsour 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’sour business, financial condition and results of operations.

The Company’sOur success depends upon the Company’sour ability to successfully manage the Company’sour inventory and to anticipate and respond to product trends and consumer demands in a timely manner. The Company’s products appeal to consumers who are, or could become, RV owners. The preferences of theseour target consumers cannot be predicted with certainty and are subject to change. Further, the retail consumer industry, by its nature, is volatile and sensitive to numerous economic factors, including consumer preferences, competition, market conditions, general economic conditions and other factors outside of the Company’s control. The Company typically ordersWe may order products well in advance of the following selling season. The extendedExtended lead times for many of the Company’sour purchases may make it difficult for the Companyus to respond rapidly to new or changing product trends, increases or decreases in consumer demand or changes in prices. If the Company misjudgeswe misjudge either the market for the Company’sour products or itsour consumers’ purchasing habits in the future, the Company’sour revenues may decline significantly, the Companywe may not have sufficient inventory to satisfy consumer demand or sales orders, or the Companywe may be required to discount excess inventory; all of which could have a material adverse effect on the Company’sour business, financial condition and results of operations.

The Company’s same store salesOur business is impacted by general economic conditions, ongoing economic and financial uncertainties, and or a change in consumer tastes, may fluctuatecause a decline in consumer spending that may adversely affect our business, financial condition and results of operations.

We depend on consumer discretionary spending and, accordingly, we may be adversely affected if our customers reduce, delay or forego their purchases of our products, services, and protection plans as a result of, including but not belimited to, recessionary conditions, job loss, bankruptcy, higher consumer debt, rising interest rates, inflation, 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 meaningful indicatorresult of future performance.consumer tastes in response to climate change), falling home prices, lower consumer confidence, uncertain or changes in tax policies, uncertainty due to national or international security or health concerns, volatility in the stock market, or epidemics.

The Company’s same store sales may vary from quarter to quarter. ADecreases in the number of factorscustomers, average spend per customer, or retention and renewal rates for our consumer services and plans would negatively affect and will continue to affect the Company’s same store sales results, including:

An unanticipated decline in revenues or same store salesour financial performance. A prolonged period of depressed consumer spending could have a material adverse effect on our business. In addition, adverse economic conditions may result in an increase in our operating expenses due to, among other things, higher costs of labor, energy, equipment and facilities. Due to recent fluctuations in the Company’sU.S. economy and the COVID-19 pandemic, our sales, operating and financial results for a particular period are difficult to predict, making it difficult to forecast results for future periods. Additionally, we are subject to economic fluctuations in local markets, most significantly Florida, that may not reflect the general economic conditions of the broader U.S. economy. Any of the foregoing factors could have a material adverse effect on our business, financial condition and results of operations.

Additionally, economic uncertainty and business downturns in the U.S. markets have adversely affected, and may in the future adversely affect, our financial condition and results of operations.

Competition in the market for products, services, and protection plans targeting the RV lifestyle or RV enthusiast could reduce our 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 we compete 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 we currently operate. If any of our competitors successfully provides a broader, more efficient or attractive combination of products, services and protection plans to our target customers, our business results could be materially adversely affected. Our 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 our business, financial condition and results of operations.

The cyclical nature of the Company’sour business has caused itsour sales and results of operations to fluctuate. These fluctuations may 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 the foregoingthese factors, the Company’sour sales and results of operations have fluctuated, and the Company expectswe expect that they will continue to fluctuate in the future.

The Company’sOur business is seasonal, and this leads to fluctuations in sales and revenues.

The Company hasWe have experienced, and expectsexpect to continue to experience, some variability in revenue, net income and cash flows as a result of annual seasonality in itsour business. Because the Company’sour largest dealership is located in the southern United States, demand for services, protection plans, products 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 Florida, which could substantially damage property and inventory in our Florida dealerships, especially in Tampa, and lead to a material disruption of operations at our Tampa, Florida headquarters and dealership.

For the years ended December 31, 20182022 and 2017,2021, we generated 58% and 51% (excluding the Company generated 56% and 54%impact of itsacquisitions) of our annual revenue in the first and second fiscal quarters, respectively, which include the peak winter months. The Company incursCOVID-19 pandemic affected our sales patterns in 2021. We incur additional expenses in the first and second fiscal quarters due to higher purchase volumes, increased staffing in the Company’sour retail locations and program costs. If, for any reason, the Company miscalculateswe miscalculate the demand for itsour products or itsour product mix during the first and second fiscal quarters, the Company’sour 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’sour business, financial condition and results of operations.

Due to the Company’sour seasonality, the possible adverse impact from other risks associated with itsour business, including atypicalextreme weather, consumer spending levels and general business conditions, is potentially greater if any such risks occur during the Company’sour peak sales seasons.seasons, which are the first and second fiscal quarters.

The Company’s business mayWe primarily lease our retail locations and if we are unable to maintain those leases or locate alternative sites for retail locations in our target markets and on terms that are acceptable to it, our revenues and profitability could be materially adversely affected by unfavorable conditions in its local markets, even if those conditions are not prominent nationally.affected.

The Company’s performance is subject to local economic, competitive, weather and other conditions prevailing in geographic areas where it operates. Since a large portionWe lease 12 of the Company’s sales are generated18 real properties where we have operations. At inception of the leases, they generally provide for fixed monthly rentals with escalation clauses and range from three to twenty years. There can be no assurance that we will be able to maintain our existing retail locations as leases expire, extend the leases or be able to locate alternative sites in Florida,our target markets and on favorable terms. Any failure to maintain our existing retail locations, extend the Company’s results of operations depend substantiallyleases or locate alternative sites 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, itfavorable or acceptable terms could have a material adverse effect on the Company’sour business, financial condition and results of operations.

We may be unable to enforce our intellectual property rights and/or we may be accused of infringing the intellectual property rights of third parties which could have a material adverse effect on our business, financial condition and results of operations.

We own a variety of registered trademarks and service marks. We believe that our trademarks have significant value and are important to our marketing efforts. If we are unable to continue to protect the trademarks and service marks for our proprietary brands, if such marks become generic or if third parties adopt marks similar to our marks, our ability to differentiate our products and services may be diminished. In the event that our trademarks or service marks are successfully challenged by third parties, we could lose brand recognition and be forced to devote additional resources to advertising and marketing new brands for our products.

From time to time, we may be compelled to protect our intellectual property, which may involve litigation. Such litigation may be time-consuming, expensive and distract our management from running the day-to-day operations of our business, and could result in the impairment or loss of the involved intellectual property. There is no guarantee that the steps we take to protect our intellectual property, including litigation when necessary, will be successful. The Companyloss or reduction of any of our significant intellectual property rights could diminish our ability to distinguish our products and services from competitors’ products and services and retain our market share for our products and services. Our inability to effectively protect our proprietary intellectual property rights could have a material adverse effect on our business, results of operations and financial condition.

Other parties also may claim that we infringe on their proprietary rights. Such claims, whether or not meritorious, may result in the expenditure of significant financial and managerial resources, injunctions against us or the payment of damages. These claims could have a material adverse effect on our business, financial condition and results of operations.

Regulations applicable to the sale of extended service contracts could materially impact our business and results of operations.

We offer 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 our 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 our 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 our business, financial condition and results of operations.

If state dealer laws are repealed or weakened, our 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 we operate, or manufacturers convince legislators to pass legislation in those states allowing termination or non-renewal of dealerships without cause, manufacturers may be able to expand geographically,terminate our 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 us to renew our dealer agreements upon expiration.

The ability of a manufacturer to grant additional dealer agreements is based on a number of factors which we cannot control. If manufacturers grant new dealer agreements in areas near our existing markets, such new dealer agreements could have a material adverse effect on our business, financial condition and any geographic expansion may not adequately insulate the Company from the adverse effectsresults of local or regional economic conditions.operations.

Risks Associated with Our Debt Obligations

The CompanyWe may not be able to satisfy itsour debt obligations upon the occurrence of a change in control under itsour credit facility.

A Changechange in Control,control is an event of default under the credit facility. Upon the occurrence of a Changechange in Control,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’sour 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 Companywe will have sufficient resources available to satisfy all of itsour obligations under the credit facility if no waiver or amendment is obtained. The effect of this provision may be to make a change in control less likely, potentially decreasing the value of our shares of common stock. In the event the Company waswe are unable to satisfy these obligations, it could have a material adverse impact on the Company’sour business, financial condition and results of operations.

The Company’sOur ability to operate and expand itsour business and to respond to changing business and economic conditions will depend on the availability of adequate capital.

As of December 31, 2017, the Company had an existing credit agreement that included a $13.0 million term loan (the “Term Loan Facility”) and $7.0 million of commitments for revolving loans (the “Revolving Credit Facility” and, together with the Term Loan Facility, as amended, the “Senior Secured Credit Facilities”). Additionally, the Company also had up to $140.0 million in committed financing under the floor plan facility. As of December 31, 2017, the Company had $9.1 million of term loans outstanding under the Senior Secured Credit Facilities, net of $0.1 million of unamortized original issue discount, no borrowings outstanding under the Senior Secured Credit Facilities and $105.0 million in floor plan notes payable outstanding under the floor plan facility, net of $0.2 million of unamortized original issue discount, with $7.0 million of additional borrowing capacity under the Revolving Credit Facility and $34.8 million of additional borrowing capacity under the floor plan facility. On March 15, 2018, the Company entered into a $200.0 million facility with M&T Bank, which includes a $175.0 million floor plan facility, a $20.0 million term loan and a $5.0 million line of credit (the “M&T Facility”), which replaced the Senior Secured Credit Facilities. As of December 31, 2018, the Company had $17.8 million outstanding under the term loan and $143.9 million outstanding under the floor plan facility. There were no outstanding borrowings under the line of credit.

The operation of the Company’sour business, the rate of the Company’sour expansion and the Company’sour 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’sour business and, if necessary, the availability of equity or debt capital. The CompanyWe also requiresrequire sufficient cash flow to meet itsour obligations under itsour existing debt agreements. The Term Loan Facility with Bank of America required the Company to make monthly principal payments of the outstanding principal amount thereof and the Company paid $0.3 million and $1.9 million for the years ended December 31, 2018 and 2017, respectively. The Company repaid the Term Loan Facility on March 15, 2018 for $8.8 million. Additionally, the Company paid total cash interest on its Senior Secured Credit Facilities of $0.1 million and $0.6 million for the years ended December 31, 2018 and 2017, respectively, and the Company paid total floor plan interest expense on its floor plan facility of $1.0 million and $3.7 million for the years ended December 31, 2018 and 2017, respectively. The M&T Term LoanOur term loan requires the Companyit to pay monthly principal installments of $0.242 million plus accrued interest through the maturity date. At the maturity date, the Companywe will pay a principal balloon payment of $11.3$2.6 million plus accrued interest. For the year ended December 31, 2018, the Company made principal payments of $2.2 million, paid total cash interest of $0.7 million and paid total floor plan interest of $3.2 million under its credit agreement with M&T Bank. See “Management’s Discussion and Analysis and Results of Operations —Liquidity and Capital Resources” below.

The Company isWe are dependent to a significant extent on itsour ability to finance itsour new and certain of its usedour pre-owned RV inventory under the credit facility. Floor plan financing arrangements allow the Companyus to borrow money to purchase new RVs from the manufacturer or usedpre-owned RVs on trade-in or at auction and pay off the loan when the Company sellswe sell the financed RV. The CompanyWe may need to increase the capacity of itsour existing credit facility in connection with itsour acquisition of dealerships and overall growth. In the event that the Company iswe are unable to obtain such incremental financing, the Company’sour ability to complete acquisitions could be limited.

The CompanyWe cannot ensure you that itsour cash flow from operations or cash available under itsour credit facility will be sufficient to meet itsour needs. If the Company iswe are unable to generate sufficient cash flows from operations in the future, and if availability under itsour credit facility is not sufficient, the Companywe may have to obtain additional financing. If the Company obtainswe obtain additional capital through the issuance of equity, the interests of existing stockholders of the Company may be diluted. If the Company incurswe incur additional indebtedness, such indebtedness may contain significant financial covenants and other negative covenants that may significantly restrict the Company’sour ability to operate. The CompanyWe cannot ensure you that itwe could obtain additional financing on favorable terms or at all.

The documentation governing the Company’sOur credit facility containcontains restrictive covenants that may impair the Company’sour ability to access sufficient capital and operate itsour business.

The documentation governing the Company’sOur credit facility containcontains various provisions that limit the Company’sour ability to, among other things: (a) incur additional indebtedness or liens; (b) consolidate or merge; (c) alter the business conducted by the Company and our subsidiaries; (d) make investments, loans, advances, guarantees and acquisitions; (e) sell assets, including capital stock of our 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; (h) engage in transactions with affiliates; and (i) and enter into agreements restricting our subsidiaries’ ability to pay dividends.

In addition, the restrictive covenants contained in the documentation governing the credit facility require the Companyus to maintain specified financial ratios. See “Management’s“Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources”Resources” below. The Company’sOur ability to comply with those financial ratios may be affected by events beyond itsour control, and itsour failure to comply with these ratios could result in an event of default.

The restrictive covenants contained in the documentation governing the credit facility may affect the Company’sour ability to operate and finance itsour business as it deemswe deem appropriate. The Company’sOur inability to meet obligations as they become due or to comply with various financial covenants contained in the instruments governing itsour current or future indebtedness could constitute an event of default under the instruments governing the Company’sour indebtedness.

If there were an event of default under the instruments governing the Company’sour 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’sour other indebtedness. The CompanyWe may not have sufficient funds available, or the Companywe may not have access to sufficient capital from other sources, to repay any accelerated debt. Even if the Companywe could obtain additional financing, the terms of such financing may not be favorable to the Company.us. In addition, substantially all of the Company’sour assets are subject to liens securing the obligations under the credit facility. If amounts outstanding under the credit facility were accelerated, the Company’sour lenders could foreclose on these liens and the Companywe could lose substantially all of itsour assets. Any event of default under the instruments governing the Company’sour indebtedness could have a material adverse effect on the Company’sour business, financial condition and results of operations.

Natural disasters, whether or not caused by climate change, unusual weather conditions, epidemic outbreaks, terrorist acts and political events could disrupt business and result in lower sales and otherwise adversely affect the Company’s financial performance.

The occurrence of one or more natural disasters, such as tornadoes, hurricanes, fires, floods, hail storms and earthquakes, unusual weather conditions, epidemic outbreaks such as Ebola, Zika virus or measles, terrorist attacks or disruptive political events in certain regions where the Company’s stores are located could adversely affect the Company’s business and result in lower sales. Severe weather, such as heavy snowfall or extreme temperatures, may discourage or restrict customers in a particular region from traveling to the Company’s dealerships or utilizing the Company’s products, thereby reducing the Company’s sales and profitability. Natural disasters including tornadoes, hurricanes, floods, hail storms and earthquakes may damage the Company’s stores or other operations, which may materially adversely affect the Company’s financial results. Any of these events could have a material adverse effectWe depend on the Company’s business, financial condition and results of operations.

The Company depends on itsour relationships with third party providers of services, protection plans, products and resources and a disruption of these relationships or of these providers’ operations could have an adverse effect on the Company’sour business and results of operations.

The Company’sOur business depends in part on developing and maintaining productive relationships with third party providers of products, services, protection plans, and resources that the Company marketswe market to itsour customers. Additionally, the Company relieswe rely on certain third party providers to support itsour products, services, protection plans, and resources, including insurance carriers for the Company’sour property and casualty insurance and extended service contracts, banks and captive financing companies for vehicle financing and refinancing. The CompanyWe cannot accurately predict when,whether, or the extent to which, itwe will experience any disruption in the supply of products from itsour vendors or services from itsour third party providers. Any such disruption could negatively impact the Company’sour ability to market and sell itsour products, services, protection plans, and resources, which could have a material adverse effect on the Company’sour business, financial condition and results of operations.

With respect to the insurance programs that the Company offers, the Company iswe offer, we are 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 Companywe may be required to use an alternative carrier or change itsour insurance products or cease marketing certain insurance related products in certain states, which could have a material adverse effect on the Company’sour business, financial condition and results of operations. If the Company iswe are required to use an alternative insurance carrier or change itsour insurance related products, itwe may materially increase the time required to bring an insurance related product to market. Any disruption in the Company’sour service offerings could harm the Company’sour reputation and result in customer dissatisfaction.

Additionally, the Company provideswe provide 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’sour customers, provides financing to fewer customers or no longer provides financing on competitive terms, or if the Company iswe are 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’sour business, financial condition and results of operations.

A portion of the Company’sour revenue is from financing, insurance and extended service contracts, which depend on third party lenders and insurance companies. The CompanyWe cannot ensure these third parties will continue to provide RV financing and other products.

A portion of the Company’sour revenue comes from the fees the Company receiveswe receive from lending institutions and insurance companies for arranging financing and insurance coverage for the Company’sour customers. The lending institution pays the Company a fee for each loan that it arranges. If these lenders were to lend to the Company’sour customers directly rather than through the Company, the Companyus, we would not receive a fee. In addition, if customers prepay financing the Companywe arranged within a specified period (generally within six months of making the loan), the Company iswe are required to rebate (or “chargeback”) all or a portion of the commissions paid to the Company by the lending institution. The Company’ssame process applies to vehicle services contract fees, which are also subject to chargebacks if a customer chooses to terminate the contract early. We receive a chargeback for a portion of the initial fees received. Our 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 Companywe can arrange financing, or may elect to not continue to provide these products with respect to RVs. The Company’sOur customers may also use the internet or other electronic methods to find financing alternatives. If any of these events occur the Companyon a large scale, we could lose a significant portion of itsour income and profit.

Furthermore, new and usedpre-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 Companywe typically hashave 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 recognizesWe recognize revenue when the applicable new or usedpre-owned vehicle is delivered and the Company haswe have 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 in the Company’s consolidated financial statements included elsewhere in this Annual Report on Form 10-K and totaled $12.3$15.4 million and $24.2 million as of December 31, 20182022 and $15.5 million as of December 31, 2017.2021, respectively. Any significant number of defaults on these retail installment sales contracts could have a material adverse effect on the Company’sour business, financial condition and results of operations.

If the Company is unable to retain senior executives and attract and retain other qualified employees, the Company’s business might be adversely affected.

The Company’s success depends in part on its ability to attract, hire, train and retain qualified managerial, sales and marketing personnel. Competition for these types of personnel is high. The Company may be unsuccessful in attracting and retaining the personnel it requires to conduct its operations successfully and, in such an event, the Company’s business could be materially and adversely affected. The Company’s success also depends to a significant extent on the continued service and performance of the Company’s senior management team, including its Chairman and Chief Executive Officer, William Murnane. The loss of any member of the Company’s senior management team could impair its ability to execute its business plan and could therefore have a material adverse effect on the Company’s business, results of operations and financial condition. The Company does not currently maintain key man life insurance policies on any member of its senior management team or other key employees. The Company entered into an employment agreement with William Murnane, the Company’s Chief Executive Officer and Chairman, which became effective upon the consummation of the Mergers. The Company has entered into an employment offer letter with Nicholas Tomashot, the Company’s Chief Financial Officer. The Company does not have any other employment agreements currently in place with other senior executives.

The Company’s business depends on its ability to meet its labor needs.

The Company’s success depends in part upon its ability to attract, motivate and retain a sufficient number of qualified employees, including market managers, general managers, sales managers, department managers and sales associates. Qualified individuals of the requisite caliber may be scarce in some areas. If the Company is unable to hire and retain sales associates capable of consistently providing a high level of customer service, as demonstrated by, among other qualities, their enthusiasm for the Company’s culture and knowledge of the Company’s products, the Company’s business could be materially adversely affected. Although none of the Company’s employees is currently covered by collective bargaining agreements, the Company’s employees may elect to be represented by labor unions in the future. If Company employees were to so elect, the Company’s labor costs could increase. Additionally, competition for qualified employees could require the Company to pay higher wages to attract the required number of employees. An inability to recruit and retain a sufficient number of qualified employees in the future may delay any planned openings or expansions of new dealerships. Any such delays, any material increases in employee turnover rates at existing stores or any increases in labor costs 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 most of the real properties where it has operations, including, as of December 31, 2018, five of the six Lazydays retail locations operating in four states. The Company’s leases, at inception, generally provide for fixed monthly rentals with escalation clauses and range from five to twenty years. There can be no assurance that the Company will be able to maintain its existing retail locations as leases expire, 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’sOur business is subject to numerous federal, state and local regulations.regulations.

The Company’sOur operations are subject to varying degrees of federal, state and local regulation, including regulations with respect to the Company’sour 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 itswe operate our businesses. For example, in the past a principal source of leads for the Company’sour 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 isWe are 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. Federal and state authorities also have various environmental control standards relating to air, water, noise pollution and hazardous waste generation and disposal which affect the Company’s business and operations.

Further, certain federal and state laws and regulations affect the Company’sour activities. Areas of the Company’sour 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 BCFP,Bureau of Consumer Financial Protection (“BCFP”), an independent federal agency funded by the United States Federal Reserve 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 March 2013, the BCFP issued supervisory guidance highlighting its concern that the practice of automotive dealers being compensated for arranging customer financing through discretionary markup of wholesale rates offered by financial institutions (“dealer markup”) results in a significant risk of pricing disparity in violation of ECOA. The BCFP recommended that financial institutions under its jurisdiction take steps to address compliance with the ECOA, which may include imposing controls on dealer markup, monitoring and addressing the effects of dealer markup policies, and eliminating dealer discretion to markup buy rates and fairly compensating dealers using a different mechanism.

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’sour annual employee health care costs that it fundswe fund and has increased the Company’sour 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’sour employee healthcare costs. If health carehealthcare costs rise, the Companywe may experience increased operating costs, which may adversely affect the Company’sour business, financial condition and results of operations.

Furthermore, the Company’sour property and casualty insurance programs that it offerswe offer 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’sOur 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’sour 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 reviewsWe review all marketing materials it disseminateswe disseminate to the public for compliance with applicable insurance regulations. The Company isWe are required to maintain certain licenses and approvals in order to market insurance products.

The Company hasWe have instituted various comprehensive policies and procedures to address compliance. However, there can be no assurance that employees, contractors, vendors or the Company’sour agents will not violate such laws and regulations or the Company’sour 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. 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 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.

The Company currently transfers the majority of the administration and liability obligations associated with these extended service contracts to a third party 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. Although the lobbying efforts have been unsuccessful to date, if dealer laws are repealed in the states in which the Company operates, 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’sOur failure to comply with certain environmental regulations could adversely affect the Company’sour business, financial condition and results of operations.

The Company’sOur 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’sour business is subject to federal, state and local requirements that regulate the environment and public health and safety. The CompanyWe may incur significant costs to comply with such requirements. The Company’sOur failure to comply with these regulations and requirements could cause the Companyus to become subject to fines and penalties or otherwise have an adverse impact on the Company’sour business. In addition, the Company haswe have indemnified certain of itsour landlords for any hazardous waste which may be found on or about property the Company leases.we lease. If any such hazardous waste were to be found on property that the Company occupies,we occupy, a significant claim giving rise to the Company’sour indemnity obligation could have a negative effect on the Company’sour business, financial condition and results of operations.

Risks Related to Our Capital Stock

Climate change legislationFuture resales of the shares of common stock of the Company issued to the stockholders and the investors in the Private Investment in Public Equity (PIPE) Investment may cause the market price of our securities to drop significantly, even if our business is doing well.

We are party to a registration rights agreement pursuant to which certain stockholders have been granted certain 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 we 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 continuing effectiveness of the resale registration statement or regulations restricting emissionupon satisfaction of “greenhouse gases”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 resulthave the effect of increasing the volatility in increased operating costsour stock price or putting significant downward pressure on the price of our common stock.

Our outstanding Series A convertible preferred stock, warrants, options and reduced demandrestricted stock units may have an adverse effect on the market price of our common stock.

As of December 31, 2022, we had outstanding (i) stock options issued to the board of directors and employees to purchase 1,052,093 shares of common stock at exercise prices ranging from $5.05 to $30.00 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 726,878 shares of our common stock at $11.50 per share issued in the PIPE Investment, (iv) warrants to purchase 2,138,190 shares of our common stock at $11.50 per share held by Andina public shareholders, (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, and (vi) 207,822 restricted stock units. 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, restricted stock units 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, stock options and restricted stock units 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 RVsother holders of our 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 sells.

The United States Environmental Protection Agency has adopted rules under existing provisionscommon stock and have the right to designate two members to our board of directors. This significantly influences the composition of the board of directors of the Company and future actions taken by the board of directors of the Company.

Our board of directors currently has seven members. The holders of the Series A Preferred Stock are exclusively entitled to designate two members to our board of directors. In addition, the holders of the Series A Preferred Stock are entitled to vote upon all matters upon which holders of our common stock have the right to vote and are entitled to the number of votes equal to the number of full shares of Company common stock into which such shares of Series A Preferred Stock could be converted at the then applicable conversion rate. These matters include the election of all director nominees not designated by the holders of the Series A Preferred Stock. As a result, the holders of the Series A Preferred Stock have significant influence on the composition of our board of directors.

As of December 31, 2022, the holders of the Series A Preferred Stock held approximately 34.9% of the voting power of the Company on an as-converted basis, taking into account the accrued dividends which we may elect to pay in cash or shares of common stock. As a result, the holders of the Series A Preferred Stock will have the ability to influence future actions by the Company requiring stockholder approval.

Pursuant to the Certificate of Designations governing the Series A Preferred Stock, the holders of the Series A Preferred Stock must consent to the Company taking certain actions, including among others, the increase in the number of directors constituting our board of directors above eight members, the incurrence of certain indebtedness and the sale of certain assets. The holders of the Series A Preferred Stock are not obligated to consent to any specific action and there can be no assurance that the holders will consent to any action our board of directors determines is in the best interests of our stockholders as a whole.

Additionally, the holders of the Series A Preferred Stock have been granted a right of first refusal on certain debt financings. Pursuant to this right, the holders of the Series A Preferred Stock have 15 business days to determine whether they want to undertake a covered debt financing. This may delay our ability to undertake a debt financing and may cause certain third parties to be less willing to engage in any debt financing with us. As a shareholder Series A Preferred shareholders could negatively impact your investment and may not take actions that will be in your best interest.

Our board of directors approved a new stock repurchase program, which could increase the volatility of the price of our common stock.

In September 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. On December 15, 2022, our board of directors approved the extension of the program for the remaining balance of $13.7 million and approved additional repurchases of $50.0 million, each through December 31, 2024. Repurchases may be made at management’s discretion from time to time in the open market, through privately negotiated transactions or pursuant to a trading plan subject to market conditions, applicable legal requirements and other factors. There can be no assurance 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.

Our 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 us and our stockholders, which could increase the costs to bring a claim in a judicial forum viewed by the stockholders as more favorable for disputes with us or our directors, officers or employees.

Our 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 our behalf, any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers or other employees to the Company or our 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 our directors, officers or other employees, which may discourage such lawsuits against the Company or our directors, officers and other employees. Alternatively, if a court were to find the choice of forum provision contained in our amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions. The exclusive forum provision in our amended and restated certificate of incorporation does not apply to actions arising under the federal Clean Airsecurities 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 Securities Exchange Act that require a reductionof 1934, as amended, or the Securities Act of 1933, as amended, or the respective rules and regulations promulgated thereunder.

General Risk Factors

We depend on our ability to attract and retain customers.

Our future success depends upon our ability to attract and retain customers for our products, services, protection plans, and resources. The extent to which we achieve growth in emissionsour customer base materially influences our profitability. Any number of greenhouse gases from motor vehicles. The adoptionfactors could affect our ability to grow our customer base. These factors include consumer preferences and general economic conditions, our ability to maintain our retail locations, weather conditions, the availability of any laws or regulations requiringalternative products, significant increases in fuel economy requirementsgasoline prices, the disposable income of consumers available for discretionary expenditures and the external perception of our brands. Any significant decline in our customer base, the rate of growth of our customer base or new federal or state restrictions on vehicles and automotive fuels in the United States could adversely affectcustomer demand for those vehicles and could have a material adverse effect on the Company’sour 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 from competitors’ products and retain its market share for its proprietary products. 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 iswe are unable to protect, maintain or upgrade itsour information technology systems or if the Company iswe are unable to convert to alternate systems in an efficient and timely manner, the Company’sour operations may be disrupted or become less efficient.

The Company dependsWe depend on a variety of information technology systems for the efficient operation of itsour business. The Company reliesWe rely on hardware, telecommunications and software vendors to maintain and periodically upgrade many of these information technology systems so that the Companywe can continue to operate itsour business. Various components of the Company’sour information technology systems, including hardware, networks, and software, are licensed to the Companyus by third party vendors. The Company reliesWe rely extensively on itsour information technology systems to process transactions, summarize results and efficiently manage itsour business. Additionally, because the Company acceptswe accept debit and credit cards for payment, the Company iswe are subject to the Payment Card Industry Data Security Standard (the “PCI Standard”), issued by the Payment Card Industry Security Standards Council. The PCI Standard contains various compliance guidelines with respect to the Company’sour security surrounding the physical and electronic storage, processing and transmission of cardholder data. The Company isWe are 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’sour operations. Any material interruptions or failures in the Company’sour payment-related systems could have a material adverse effect on the Company’sour business, financial condition and results of operations.

Any disruptions to the Company’sour information technology systems or breaches of the Company’sour network security could interrupt itsour operations, compromise itsour reputation, expose itus to litigation, government enforcement actions and costly response measures and could have a material adverse effect on the Company’sour business, financial condition and results of operations.

The Company reliesWe rely on the integrity, security and successful functioning of itsour information technology systems and network infrastructure across the Company’sour operations. The Company usesWe use information technology systems to, among other things, generate and manage sales leads, support itsour consumer services and plans, manage procurement, manage itsour supply chain, track inventory information at itsour retail locations, communicate customer information and aggregate daily sales, margin and promotional information. The CompanyWe also usesuse information systems to report and audit itsour operational results.

In connection with sales, the Company transmitswe transmit encrypted confidential credit and debit card information. Although the Company iswe are currently in compliance with the PCI Standard, there can be no assurance that in the future the Companywe will be able to remain compliant with the PCI Standard or other industry recommended or contractually required practices. Even if the Company continueswe continue to be compliant with such standards, itwe still may not be able to prevent security breaches.

The CompanyWe also hashave access to, collectscollect or maintainsmaintain private or confidential information regarding itsour customers, associates and suppliers, as well as the Company’sour business. The protection of the Company’sour customer, associate, supplier and company data is critical to the Company.us. The regulatory environment surrounding information security and privacy is increasingly demanding, with the frequent imposition of new and constantly changing requirements across the Company’sour business and operations. In addition, the Company’sour customers have a high expectation that the Companywe will adequately protect their personal information from cyber-attacks and other security breaches. The Company hasWe have procedures in place to safeguard itsour 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’sour relationships with itsour customers and suppliers, harm the Company’sour reputation and result in lost sales, fines and/or lawsuits.

An increasingly significant portion of the Company’sour sales depends on the continuing operation of itsour information technology and communications systems, including but not limited to itsour point-of-sale system and itsour credit card processing systems. The Company’sOur 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’sour associates or the Company’sour contractors or other attempts to harm the Company’sour systems, including cyber-security attacks, hacking by third parties, computer viruses or other breaches of cardholder data. Some of the Company’sour information technology and communication systems are not fully redundant and the Company’sour 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’sour information technology and communications systems. Any errors or vulnerabilities in the Company’sour information technology and communications systems, or damage to or failure of itsour information technology and communications systems, could result in interruptions in the Company’s services and non-compliance with certain regulations or expose the Companyus to risk of litigation and liability, which could have a material adverse effect on the Company’sour business, financial condition and results of operations.

Increases in the minimum wage or overall wage levels could adversely affect the Company’s financial results.

From time to time, legislative proposals are made to increase the federal minimum wage in the United States, as well as the minimum wage in a number of individual states. As federal or state minimum wage rates increase, the Company may be required to increase not only the wage rates of the Company’s minimum wage employees, but also the wages paid to the Company’s other hourly employees as well. Any increase in the cost of the Company’s labor could have an adverse effect on the Company’s operating costs, financial condition and results of operations.

The CompanyWe may be subject to product liability claims if people or property are harmed by the products the Company sellswe sell and may be adversely impacted by manufacturer safety recalls.

Some of the products the Company sellswe sell may expose the Companyus 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 maintainswe maintain liability insurance, the Companywe cannot be certain that itsour insurance coverage will be adequate for liabilitieslosses actually incurred or that insurance will continue to be available to the Companyus on economically reasonable terms, or at all. In addition, some of the Company’sour agreements with itsour vendors and sellers do not indemnify the Companyus 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 itsour reputation with existing and potential consumers and have a material adverse effect on the Company’sour business, financial condition and results of operations.

The Company may be named in litigation, which may result in substantial costs and reputational harm and divert management’s attention and resources.

The Company faces legal risks in its business, including claims from disputes with its employees and its former employees and claims associated with general commercial disputes, product liability and other matters. Risks associated with legal liability often are difficult to assess or quantify and their existence and magnitude can remain unknown for significant periods of time. While the Company maintains director and officer insurance, as well as general and product liability insurance, the amount of insurance coverage may not be sufficient to cover a claim and the continued availability of this insurance cannot be assured. Regardless of their subject matter or merits, class action lawsuits may result in significant cost to the Company, which costs may not be covered by insurance, may divert the attention of management or may otherwise have an adverse effect on the Company’s business, brand image, financial condition and results of operations. Negative publicity from litigation, whether or not resulting in a substantial cost to the Company, could materially damage the Company’s reputation. The Company may in the future be the target of litigation and any such litigation may result in substantial costs and reputational harm and divert management’s attention and resources. Costs, harm to the Company’s reputation and diversion of management’s attention and resources could have a material adverse effect on the Company’s business, financial condition and results of operations.

The Company’sOur risk management policies and procedures may not be fully effective in achieving their purposes.

The Company’sOur policies, procedures, controls and oversight to monitor and manage itsour enterprise risks may not be fully effective in achieving their purpose and may leave the Companyus exposed to identified or unidentified risks. Past or future misconduct by the Company’sour 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 itsus. We monitor our policies, procedures and controls; however, there can be no assurance that its policies, procedures and controlsthese will be sufficient to prevent all forms of misconduct. The Company reviews itsWe review our compensation policies and practices as part of the Company’sour overall enterprise risk management program, but it is possible that itsour 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’sour business, financial condition and results of operations.

The CompanyWe could incur asset impairment charges for goodwill, intangible assets or other long-lived assets.

The Company hasWe have a significant amount of goodwill, intangible assets and other long-lived assets. At least annually, the Company reviewswe review goodwill, trademarks and tradenamestrade names 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 indicators, 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’sOur determination of future cash flows, future recoverability and fair value of the Company’sour 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.

Risks RelatedWe may be unable to Our Stockretain senior executives and attract and retain other qualified employees.

Future resales of the shares of common stock of the Company issued to the stockholders and the investors in the PIPE Investment may cause the market price of the Company’s securities to drop significantly, even if the Company’s business is doing well.

Under the Merger Agreement, the stockholders, the optionholders, and the bonus payment recipients received, among other things, an aggregate of: (i) 2,857,189 shares of Company common stock; and (ii) $86.8 million. On May 15, 2018, as a result of a working capital adjustment, the Company received $0.6 million from the working capital escrow funds resultingOur success depends in a net purchase price of $86.2 million. On March 15, 2019, the indemnity escrow period set forth in the Merger Agreement expired and as a result certain stockholders, optionholders and the bonus payment recipients received, an aggregate of (i) 142,857 shares of Company common stock; and (ii) $5.7 million. Pursuant to the Merger Agreement, certain of the stockholders were restricted from selling any of the Company common stock that they received as a result of the Transaction Merger during the nine month period after the closing date of the Mergers, for certain stockholders, and during the twelve month period after the closing date of the Merger for certain stockholders subject to certain exceptions. These lock-up restrictions have now lapsed.

Subject to these restrictions, the Company has entered into a registration rights agreement pursuant to which certain stockholders have been granted certain demand and “piggy-back” registration rights with respect to their securities. Additionally, the investors who simultaneously with the closing of the Mergers purchased convertible preferred stock, common stock and warrants for an aggregate purchase price of $94.8 million (the “PIPE Investment”) have entered into a registration rights agreement granting them certain registration rights pursuant to which the Company has filed a registration statement covering the resale of such securities.

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 any registration statement the Company files pursuant to the above-referenced registration rights 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.

Nasdaq may delist the Company’s common stock on its exchange, which could limit investors’ ability to make transactions in the Company’s common stock and subject the Company to additional trading restrictions.

The Company’s common stock is listed on the Nasdaq Stock Market. There is no assurance that the Company will be able to maintain the listing of its common stock in the future.

If the Company’s common stock is delisted from trading on Nasdaq, the Company could face significant material adverse consequences, including:

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 March 19, 2019, we had outstanding (i) stock options issued to the board of directors and employees to purchase 3,823,421 shares of common stock at exercise prices ranging from $6.47 to $11.10 per share, (ii) pre-funded warrants to purchase up to 1,339,499 shares of common stock that were issued in the PIPE Investment, (iii) warrants to purchase 2,522,458 shares of our common stock at $11.50 per share issued in the PIPE Investment, (iv) warrants to purchase 2,155,000 shares of our common stock at $11.50 per share held by Andina public shareholders, and (v) 5,962,733 shares of common stock issuable upon the conversion of the 600,000 Series A Preferred Stock of Holdco. We may also issue additional equity awards under our 2018 Long-Term Incentive Equity Plan (the “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 our incentive plan could have an adverse effect on the market price of the common stock orpart on our ability to obtain future financing. Ifattract, hire, train and retain qualified personnel. Competition for the personnel required is high. We may be unsuccessful in attracting and retaining the personnel needed to the extent these warrantsconduct operations successfully. In this event, our business could be materially and stock options are exercised or the Series A Preferred Stock is converted to common stock, you may experience dilution to your holdings.

The Company is an “emerging growth company” and it cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make the Company’s common stock less attractive to investors.

We are an “emerging growth company,” as defined in the Jumpstart our Business Startups Act of 2012, or the JOBS Act, and we will take advantage of certain exemptions from various reporting requirements that are applicable to other public companies. These exemptions include not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley”), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Investors may find our common stock less attractive because we rely, or may rely, on these exemptions.adversely affected. In addition, under the JOBS Act, “emerging growth companies” can delay adopting new or revised accounting standards until such time as those standards apply to private companies. If some investors find our common stock less attractive as a result, the priceloss of members of our common stock may be reduced, there may be a less active trading market forsenior management team could impair our common stock and the price ofability to execute our common stock may be more volatile.

We could remain an “emerging growth company” until the last day of 2020, although a variety of circumstances could cause us to lose that status earlier. For as long as we take advantage of the reduced reporting obligations, the information that we provide stockholders may be different from information provided by other public companies.

Stockholders may become diluted as a result of issuance of options under existing or future incentive plans or the issuance of common stock as a result of acquistions or otherwise.

The Company’s 2018 Long-Term Equity Incentive Plan (the “2018 Plan”) allows the Company to issue common stock underlying stock options or other forms of stock-based compensation to employees and directors totalling 3,824,566 shares of Company common stock. As of December 31, 2018, there were 3,658,421 options outstanding, which if vested in the future may be exercised for 3,658,421 shares of Company common stock and there were 166,145 shares available to be issued under equity incentive awards pursuant to the 2018 Plan. The effect of the issuance of common stock or other instruments, such as stock options, convertible into common stock under the 2018 Plan or future plans may be dilutive to current common stockholders.

The Company may issue additional securities in the future if it needs to raise capital for operations or growth initiatives, including acquisitions. For example, the Company may currently issue 1,900,000 shares of common stock in an acquisition transaction pursuant to the Form S-4 filed with the SEC on August 31, 2018. In the event a transaction was consummated which utilized these shares, the impact may be dilutive to current common stockholders.

The price of the Company’s common stock may be volatile for a variety of reasons.

The price of the Company’s common stock may be volatile,business plan and could decline, forhave a varietymaterial and adverse effect on our business, results of reasons including the Company’s operating performance, ability to retain key employees, ability to meet covenants,operations and ability to successfully execute its growth strategy amongst other factors. The Company’s stock price may also be impacted by external factors including the general economic and political environment, actions of competitors including their quarterly performance, litigation, the perception of the industry as a whole, and changes in laws or regulations, including accounting standards. As a result, these factors may adversely impact the market price of the Company’s common stock, regardless of the Company’s operational or finanical performance. Additionally, the impact of volatility may be greater if the Company’s public float and volume is smaller than some of its competitors.financial condition.

Item 1B. Unresolved Staff Comments

None.

Item 2. The conversion of the Series A Preferred Stock into Company common stock may dilute the value for the other holders of Company common stock.Properties

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 resulting 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. As a result, these holders may influence the composition of the board of directors of the Company and future actions taken by the board of directors of the Company.

The holders of the Series A Preferred Stock are entitled to vote upon all matters upon which holders of the Company common stock have the right to vote and are entitled to the number of votes equal to the number of full shares of Company common stock into which such shares of Series A Preferred Stock could be converted at the then applicable conversion rate. Accordingly, the holders of the Series A Preferred Stock hold approximately 41.3% of the voting power of the Company on an as-converted basis. As a result, the holders of the Series A Preferred Stock may have the ability to influence future actions by the Company requiring stockholder approval.

Further, the Certificate of Designations of the Series A Preferred Stock provides that the holders of the Series A Preferred Stock have the right to nominate for election two individuals to the Company’s board of directors. As a result, the holders of Series A Preferred Stock will be able to influence the composition of the board of directors and, in turn, potentially influence and impact future actions taken by the board of directors of the Company.

The holders of the Series A Preferred Stock have certain rights that may not allow the Company to take certain actions.

Pursuant to the certificate of designations governing the Series A Preferred Stock, the holders of the Series A Preferred Stock must consent to the Company taking certain actions, including among others, the increase in the number of directors constituting the Company’s board of directors above eight members, the incurrence of certain indebtedness and the sale of certain assets. The holders of the Series A Preferred Stock are not obligated to consent to any specific action and there can be no assurance that the holders will consent to any action the Company’s board of directors determines is in the best interests of its stockholders as a whole.

Additionally, the holders of the Series A Preferred Stock have been granted a right of first refusal on certain debt financings. Pursuant to this right, the holders of the Series A Preferred Stock 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.

None.

Although we own the property inat five of our Arizona location,locations, we have typically leaseleased all the real estate properties where we have operations. As of December 31, 2022, there was an outstanding balance on the Houston property mortgage of $5.4 million. Our real property leases generally provide for fixed monthly rents with annual escalation clauses and multiple renewal terms of 5 or3 to 20 years each. The leases are typically “triple net” requiring us to pay real estate taxes, insurance and maintenance costs. We believe that our properties are suitable and adequate for present purposes, and that the productive capacity in such properties is substantially being utilized.

The table below sets forth certain information concerning ourOur largest leased dealership locations.property is located in Tampa, Florida. The dealership is 384,000 square feet and sits on 126 acres. The lease term is 20 years with an initial expiration date in 2035.

The Company isItem 3. Legal Proceedings

We are a party to multiple legal proceedings that arise in the ordinary course of itsour business. The Company doesWe do not believe that the ultimate resolution of these matters will have a material adverse effect on itsour business, results of operations, financial condition or cash flows. However, the results of these matters cannot be predicted with certainty and an unfavorable resolution of one or more of these or other matters could have a material adverse effect on the Company’sour business, results of operations, financial condition and/or cash flows.

Item 4. Mine Safety Disclosures

None.

None.

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Currently, our shares of common stock are listed on the NASDAQNasdaq Capital Market under the symbol “LAZY” and our warrants are quoted on the OTC Pink marketplace under the symbol “LAZYW”.

Any over-the-counter market quotations of the warrants reflect inter-dealer prices, without retail mark-up, mark-down or commission and may not necessarily represent actual transactions.

As of March 19, 2019,February 24, 2023, there were 5140 holders of record of our shares of common stock, 4 holders of record of our shares of Series A Preferred Stock and 3112 holders of record of our warrants.

We have not paid any cash dividends on our common stock and do not plan to pay any cash dividends on our common stock in the foreseeable future. Our board of directors 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.

Recent Sales of Unregistered Securities

As detailed in the following table, during the year ended December 31, 2022 several institutional investors exercised warrants issued in the PIPE Investment, pursuant to the cashless exercise provisions on the warrants, resulting in the issuance of shares of our common stock.

The above issuances were exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”) pursuant to Section 3(a)(9) of such act, as exchanges of Company securities by existing security holders where no commission or remuneration was paid or given directly or indirectly for soliciting the exchanges.

Purchases of Equity Securities by the Issuer

Information requested by this Item is not applicable as the Company has elected scaled disclosure requirements available to smaller reporting companies with respect to this Item.6. [Reserved]

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of the Company’sour financial condition and results of operations should be read in conjunction with Part I, including matters set forth in the “Risk Factors” section of this Form 10-K and our Consolidated Financial Statements and notes thereto, included in Part II, Item 8 of this Form 10-K.

Forward Looking StatementsBusiness Overview

Certain statements in this Annual Report on Form 10-K (including but not limited to this Item 7 – “Management’s Discussion and Analysis of Financial Condition and Results of Operations”) constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts included in this Annual Report on Form 10-K, including, without limitation, statements regarding the Company’s future financial position, business strategy, budgets, projected costs and plans and objectives of management for future operations, are “forward-looking” statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “estimate” or “continue” or the negative of such words or variations of such words and similar expressions. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements and the Company can give no assurance that such forward-looking statements will prove to be correct. Important factors that could cause actual results to differ materially from those expressed or implied by the forward-looking statements, or “cautionary statements,” include, but are not limited to:

The amounts set forth below are in thousands unless otherwise indicated except for unit (including the average selling price per unit), share, and per share data.

Results of Operations

For the year ended December 31, 2022, we reported net income of $66.4 million, or $2.42 per diluted share. For the year ended December 31, 2021, we reported net income of $82.0 million or $3.93 per diluted share.

Business Overview

NM - Not meaningful

Our Business

Same Store Operating Data

We believe that same store comparisons are an important indicator of our financial performance. Same store measures demonstrate our ability to grow operations in our existing locations.

Same store measures reflect results for stores that were operating in each comparison period, and only include the months when operations occurred in both periods. For example, a store acquired in August 2021 would be included in same store operating data beginning in September 2022, after its first complete comparable month of operations. The Company operates RV dealershipsfourth quarter operating results for the same store comparisons would include results for that store for both comparable periods. Note that this financial metric has no standardized meaning and offersmay not be comparable to similar measures presented by other companies.

Service, body and parts, other is a strategic area of focus and area of opportunity to grow additional earnings. Our service, body and parts revenue and gross profit increased 14.5% and 22.1%, respectively, during 2022 compared to 2021. This growth was driven primarily by acquisitions, complimented by growth in its marketingsame store results. During 2022, our same store service, body and branding communications since 2013. In this Annual Report on Form 10-K, the Company refers to Lazydays Holdings, Inc. as “Lazydays,” the “Company,” “Holdco,” “we,” “us,” “our,”parts revenue increased 3.0% and similar words.our gross profit increased 10.0%.

The Company believes, based on industry research and management’s estimates, it operates the world’s largest RV dealership, measured in terms of on-site inventory, located on 126 acres outside Tampa, FL. The Company also operates RV dealerships in Tucson, Arizona; Minneapolis, Minnesota; and two cities in Colorado, Loveland and Denver. Lazydays offers one of the largest selections of RV brands in the nation featuring more than 3,000 new and pre-owned RVs. The Company has over 400 service bays across all locations and has RV parts and accessories stores at all locations. Lazydays also has RV rental fleets in Florida, and Colorado and availability to two on-site campgrounds with over 700 RV campsites. The Company welcomes over 500,000 visitors to its dealership locations annually, and employs over 800 people at the six facilities. The Company’s dealership locations are staffed with knowledgeable local team members, providing customers access to extensive RV expertise. The Company believes its dealership locations are strategically located in key RV markets. Based on information collected by the Company from reports prepared by Statistical Surveys, these key RV markets account for a significant portion of new RV units sold on an annual basis in the U.S. The Company’s dealerships in these key markets attract customers from every state except Hawaii.

The Company attracts new customers primarily through Lazydays dealership locations as well as digital and traditional marketing efforts. Once the Company acquires customers, those customers become part of the Company’s customer database where the Company leverages CRM tools and analytics to actively engage, market and sell its products and services.Other Revenue

How The Company Generates Revenue

The Company derives its revenues from sales of new units, sales of pre-owned units, and other revenue. Other revenue consists of RV parts, service and repairs, commissions earned on sales of third-party financingparts, accessories, and insurance products, visitor fees at the Tamparelated services as well as campground revenues.

Selling, General and food facilities, and miscellaneous revenues. During the years ended December 31, 2018 and 2017, the Company derived its revenues from these categories in the following percentages:Administrative Expenses

New and pre-owned RV sales accounted for approximately 89% of total revenues for the years ended December 31, 2018 and 2017. These revenue contributions have remained relatively consistent year over year.

Key Performance Indicators

Gross Profit and Gross Margins (excluding depreciation and amortization). Gross profit is total revenue less total costs applicable to revenue excluding depreciation and amortization. The vast majority of the cost applicable to revenues is related to the cost of vehicles. New and pre-owned vehicles have accounted for 97% of the cost of revenues for the years ended December 31, 2018 and 2017. Gross margin is gross profit as a percentage of revenue.

The Company’s gross profit is variable in nature and generally follows changes in revenue. For the years ended December 31, 2018 and 2017, gross profit was $131.7 million and $127.1 million, respectively, and gross margin was 21.6% and 20.7% for the years then ended. Excluding the impact of LIFO adjustments, gross profit was $133.1 million and $130.9 million and gross margin was 21.9% and 21.3%, respectively for the years ended December 31, 2018 and 2017. The Company’s gross margins on pre-owned vehicles are typically higher than gross margins on new vehicles, on a percentage basis.

During the years ended December 31, 2018 and 2017, gross margins were also favorably impacted by other revenue, including finance and insurance revenues and parts, service, and accessories revenue. The Company’s margins on these lines of business typically carry higher gross margin percentages than new and pre-owned vehicle sales. These combined revenues were 11.5% and 11.1%, respectively, of total revenues during the years ended December 31, 2018 and 2017.

SG&A as a percentage of Gross Profit.Selling, general, and administrative (“SG&A”) expenses as a percentage of gross profit allows the Company to monitor its expense control over a period of time. SG&A consistsconsist primarily of wage-related expenses, selling expenses related to commissions and advertising, lease expenses, and corporate overhead expenses.