UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM
CURRENT REPORT
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Item 2.04. Triggering Events that Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
On November 20, 2023, Harbor Custom Development, Inc., a Washington corporation (the “Company”), failed to make the payment of $707,790.41 of principal required to be made on that date pursuant to the Company’s Loan Agreement with BankUnited, N.A. (the “Lender”), dated March 7, 2022 (the “Loan”) and the Amendment to the Loan Agreement, dated February 22, 2023 (the “Amendment”). Under the Amendment, the Company covenanted that it would pay the amount of $634,666 on the 20th of each month, in addition to remitting to the Lender 25% of the net proceeds from all asset sales, public offerings, private equity recaptures, and any capital raises. Under the Loan, a failure to make a payment of principal is defined as an Event of Default. For such an Event of Default, the Lender may accelerate all amounts due under the Loan.
To date, the Lender has not provided the Company with the required written notice of Lender’s intention to accelerate payment of all amounts due under the Loan. The Company will update this disclosure if and when written notice of Lender’s intention to accelerate payments of all amounts due under the Loan is received.
Item 5.02 Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers
On November 21, 2023, Larry Swets, a member of the Board of Directors (the “Board”) of the Company, gave notice of his resignation from the Board, effective November 21, 2023. At the time of his resignation, Mr. Swets did not hold any positions on the Audit, Compensation, or Nominating and Corporate Governance Committees of the Board. Mr. Swets’ departure from the Board was not the result of any disagreement with the Company’s management or the Board regarding any matter related to the Company’s operations, policies, or practices.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Harbor Custom Development, Inc. | ||
| Date: November 27, 2023 | By: | /s/ Jeff Habersetzer |
| Jeff Habersetzer | ||
| Interim Chief Executive Officer and Interim President | ||