0001558370-22-014338 | 10-Q | XBRL Viewer

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Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2022	Sep. 09, 2022
Document and Entity Information
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2022
Document Transition Report	false
Entity Registrant Name	Legacy Housing Corporation
Entity File Number	001-38761
Entity Incorporation, State or Country Code	TX
Entity Tax Identification Number	20-2897516
Entity Address, Address Line One	1600 Airport Freeway
Entity Address, Address Line Two	#100
Entity Address, City or Town	Bedford
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	76022
City Area Code	817
Local Phone Number	799-4900
Entity Current Reporting Status	No
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Title of 12(b) Security	Common Stock ($0.001 par value)
Trading Symbol	LEGH
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding		24,406,020
Entity Central Index Key	0001436208
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q1
Amendment Flag	false

CONDENSED BALANCE SHEETS د.ت in Thousands, $ in Thousands	Mar. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)
Current assets:
Cash and cash equivalents	$ 2,528	$ 1,042
Accounts receivable, net	6,928	5,118
Accounts receivable - dealer financed	6,715	3,496
Current portion of consumer loans receivable	6,203	6,080
Current portion of notes receivable from mobile home parks ("MHP")	8,311	10,049
Current portion of other notes receivable	26,556	21,070
Inventories	47,783	41,230
Prepaid expenses and other current assets	4,067	4,456
Total current assets	109,091	92,541
Consumer loans receivable, net	121,056	119,543
Notes receivable from mobile home parks ("MHP")	102,069	92,943
Other notes receivable, net	12,192	20,930
Inventories, net	3,738	2,678
Other assets - leased mobile homes	9,767	9,419
ROU assets - operating leases	3,258
Other assets	1,480	1,097
Property, plant and equipment, net	28,016	27,516
Total assets	390,667	366,667
Current liabilities:
Accounts payable	7,381	4,155
Accrued liabilities	19,998	20,686
Customer deposits	8,617	7,749
Escrow liability	9,142	9,350
Operating lease obligation	652
Total current liabilities	45,790	41,940
Long-term liabilities:
Operating lease obligation, less current portion	2,706
Lines of credit	5,077	7,993
Deferred income taxes, net	3,004	3,004
Dealer incentive liability	4,597	4,336
Total liabilities	61,174	57,273
Commitments and contingencies (Note 13)
Stockholders' equity:
Preferred stock, $.001 par value, 10,000,000 shares authorized: no shares issued or outstanding
Common stock, $.001 par value, 90,000,000 shares authorized; 24,851,085 and 24,654,621 issued and 24,406,020 and 24,209,556 outstanding at March 31, 2022 and December 31, 2021, respectively	29	25
Treasury stock at cost, 445,065 shares at March 31, 2022 and December 31, 2021	(4,477)	(4,477)
Additional paid-in-capital	179,626	175,623
Retained earnings	154,315	138,223
Total stockholders' equity	329,493	309,394
Total liabilities and stockholders' equity	$ 390,667	$ 366,667

CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2022	Dec. 31, 2021
CONDENSED BALANCE SHEETS
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	90,000,000	90,000,000
Common stock, shares issued	24,851,085	24,654,621
Common stock, shares outstanding	24,406,020	24,209,556
Treasury stock, shares	445,065	445,065

CONDENSED STATEMENTS OF INCOME - USD ($) $ in Thousands	3 Months Ended
CONDENSED STATEMENTS OF INCOME - USD ($) $ in Thousands	Mar. 31, 2022	Mar. 31, 2021
Net revenue:
Product sales	$ 51,787	$ 32,274
Consumer and MHP loans interest	6,765	6,638
Other	1,376	1,028
Total net revenue	59,928	39,940
Operating expenses:
Cost of product sales	33,727	22,001
Selling, general and administrative expenses	7,659	4,793
Dealer incentive	275	463
Income from operations	18,267	12,683
Other income (expense):
Non-operating interest income	853	248
Miscellaneous, net	586	204
Interest expense	(56)	(226)
Total other income	1,383	226
Income before income tax expense	19,650	12,909
Income tax expense	(3,558)	(2,208)
Net income	$ 16,092	$ 10,701
Weighted average shares outstanding:
Basic	24,351,223	24,199,107
Diluted	24,661,426	24,211,182
Net income per share:
Basic	$ 0.66	$ 0.44
Diluted	$ 0.65	$ 0.44

CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	Mar. 31, 2022	Mar. 31, 2021
Operating activities:
Net income	$ 16,092	$ 10,701
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization expense	430	368
Amortization of deferred revenue	(408)	122
Provision for accounts and notes receivable	37	550
Provision for long term inventory	(130)	17
Share based payment expense	4,007	44
Changes in operating assets and liabilities:
Accounts receivable	(1,843)	(62)
Consumer loans activity, net	(1,617)	(2,542)
Notes receivable MHP activity, net	(7,336)	(5,038)
Inventory loan activity, net	(3,249)
Inventories	(7,484)	(3,502)
Prepaid expenses and other current assets	389	120
Other assets	(4,058)	(337)
Accounts Payable	3,035	(3,635)
Customer deposits	1,025	1,234
Escrow liability	(208)	286
Dealer incentive liability	261	203
Net cash used in operating activities	(1,057)	(1,471)
Investing activities:
Purchases of property, plant and equipment	(863)	(1,717)
Issuance of notes receivable	(1,561)	(5,708)
Notes receivable collections	5,046	76
Collections from purchased loans	132	1,222
Net cash provided by (used in) investing activities	2,754	(6,127)
Financing activities:
Proceeds from other liabilities	2,706
Proceeds from lines of credit	20,331	22,667
Payments on lines of credit	(23,248)	(13,429)
Net cash provided by (used in) financing activities	(211)	9,238
Net increase in cash and cash equivalents	1,486	1,640
Cash and cash equivalents at beginning of period	1,042	768
Cash and cash equivalents at end of period	2,528	2,408
Supplemental disclosure of cash flow information:
Cash paid for interest	44	206
Cash paid for taxes	$ 3,064	$ 2,900

CONDENSED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Common Stock	Treasury stock	Additional paid-in-capital	Retained earnings	Total
Beginning Balance at Dec. 31, 2020	$ 25	$ (4,477)	$ 175,293	$ 88,352	$ 259,193
Beginning Balance (in shares) at Dec. 31, 2020	24,639,125
Share based compensation expense and stock units vested			44		44
Share based compensation expense and stock units vested (in shares)	8,571
Net income				10,701	10,701
Ending Balance at Mar. 31, 2021	$ 25	(4,477)	175,337	99,053	269,938
Ending Balance (in shares) at Mar. 31, 2021	24,647,696
Beginning Balance at Dec. 31, 2021	$ 25	(4,477)	175,623	138,223	$ 309,394
Beginning Balance (in shares) at Dec. 31, 2021	24,654,621				24,654,621
Share based compensation expense and stock units vested	$ 4		4,003		$ 4,007
Share based compensation expense and stock units vested (in shares)	158,571
Net income				16,092	16,092
Ending Balance at Mar. 31, 2022	$ 29	$ (4,477)	$ 179,626	$ 154,315	$ 329,493
Ending Balance (in shares) at Mar. 31, 2022	24,813,192				24,851,085

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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- Definition

Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity.

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NATURE OF OPERATIONS

3 Months Ended

Mar. 31, 2022

NATURE OF OPERATIONS

NATURE OF OPERATIONS

1. NATURE OF OPERATIONS

Legacy Housing Corporation (referred herein as ”Legacy”, “we”, “our”, “us”, or the “Company”) was formed on January 1, 2018 as a Delaware corporation through a corporate conversion of Legacy Housing, Ltd. (the “Partnership”), a Texas limited partnership formed in May 2005. Effective December 31, 2019, the Company reincorporated from a Delaware corporation to a Texas corporation. The Company is headquartered in Bedford, Texas.

The Company (1) manufactures and provides for the transport of mobile homes, (2) provides wholesale financing to dealers and mobile home parks, (3) provides retail financing to consumers and (4) is involved in financing and developing new manufactured home communities. The Company manufactures its mobile homes at plants located in Fort Worth, Texas, Commerce, Texas and Eatonton, Georgia. The Company relies on a network of dealers to market and sell its mobile homes. The Company also sells homes directly to dealers and mobile home parks.

In December 2018, the Company sold 4,000,000 shares of its common stock through an initial public offering (“IPO”) at $12.00 per share. Proceeds from the IPO, net of $4,504 of underwriting discounts and offering expenses paid by the Company, were $43,492. In January 2019, the Company sold an additional 600,000 shares of its common stock as part of the IPO at $12.00 per share. Proceeds from the January 2019 issuance, net of $505 of underwriting discounts and offering expenses paid by the Company, were $6,695.

On April 17, 2019, the Company purchased 300,000 shares of its common stock at the price of $10.20 per share, pursuant to the Company’s repurchase program. During the year ended December 31, 2020, the Company purchased 145,065 shares of its common stock at an average price of $9.77 per share, pursuant to the Company’s repurchase program. Under the repurchase program, the Company may purchase up to $10,000 of its common stock. Share purchases may be made from time to time in the open market or through privately negotiated transactions depending on market conditions, share price, trading volume and other factors. Such purchases, if any, will be made in accordance with applicable insider trading and other securities laws and regulations. These repurchases may be commenced or suspended at any time or from time to time without prior notice.

Corporate Conversion

Effective January 1, 2018, the Partnership converted into a Delaware corporation pursuant to a statutory conversion and changed its name to Legacy Housing Corporation. In order to consummate the corporate conversion completed on January 1, 2018, a certificate of conversion was filed with the Secretary of State of the State of Delaware and with the Secretary of State of the State of Texas. Holders of partnership interests in Legacy Housing, Ltd. received an initial allocation, on a proportional basis, of 20,000,000 shares of common stock of Legacy Housing Corporation.

Following the corporate conversion, Legacy Housing Corporation continues to hold all property and assets of Legacy Housing, Ltd. and all of the debts and obligations of Legacy Housing, Ltd. On the effective date of the corporate conversion, the officers of Legacy Housing, Ltd. became the officers of Legacy Housing Corporation. As a result of the corporate conversion, the Company is now a federal corporate taxpayer.

Basis of Presentation

The accompanying unaudited interim condensed financial statements as of March 31, 2022 and for the three months ended March 31, 2022 and 2021, respectively, have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC") as required by Regulation S-X, Rule 8-03. In the opinion of management, the unaudited interim financial statements have been prepared on the same basis as the audited financial statements, and include all adjustments, consisting only of normal recurring adjustments, necessary for the fair statement of the Company's financial position for the periods presented. The results for the three months ended March 31, 2022 are not necessarily indicative of the results to be expected for the year ending

December 31, 2022, or any other period. The accompanying balance sheet as of December 31, 2021 was derived from audited financial statements included in the Company's annual report on Form 10-K for the year ended December 31, 2021 (the "Form 10-K"). The accompanying financial statements do not include all of the information and footnotes required by GAAP for annual financial statements. Accordingly, they should be read in conjunction with the audited financial statements and notes thereto included in the Form 10-K. Certain amounts in the prior period financial statements have been reclassified to conform to the presentation of the current period financial statements. These reclassifications had no effect on the previously reported net income.

Restatement of Previously Issued Condensed Financial Statements (unaudited)

As previously reported in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, the Company has restated its interim financial statements for the period ended March 31, 2021 to correct (i) an overstatement of costs errantly assigned to accounts payable for inventory received but not invoiced, (ii) a reclassification between prepaid expenses and other current assets and other assets, (iii) a reclassification between prepaid expenses and other current assets and lines of credit, and (iv) a change in accrued liabilities and income tax expense.

The effects of the restatement on the line items within the Company’s condensed statement of operations for the three months ended March 31, 2021 were as follows:


	Three Months Ended March 31, 2021
	As
	Originally				As
	Reported		Adjustments		Restated
Operating expenses:
Cost of product sale	$	24,024	$	(2,023)	$	22,001
Income from operations	$	10,660	$	2,023	$	12,683
Income before income tax expense	$	10,886	$	2,023	$	12,909
Income tax expense	$	(1,862)	$	(346)	$	(2,208)
Net income	$	9,024	$	1,677	$	10,701
Net income per share:
Basic	$	0.37	$	0.07	$	0.44
Diluted	$	0.37	$	0.07	$	0.44

The effects of the restatement on the line items within the Company’s condensed statement of cash flows for the three months ended March 31, 2021 were as follows:


	Three months March 31, 2021
	As Originally				As
	Reported		Adjustments		Restated
Operating activities:
Net income	$	9,024	$	1,677	$	10,701
Inventories	$	(3,502)	$	—	$	(3,502)
Prepaid expenses and other current assets	$	(433)	$	553	$	120
Other assets	$	(5)	$	(332)	$	(337)
Accounts payable	$	(775)	$	(2,023)	$	(2,798)
Accrued liabilities	$	(1,183)	$	346	$	(837)
Net cash provided by (used in) operating activities	$	(1,692)	$	221	$	(1,471)
Investing activities:
Purchases of property, plant and equipment	$	(1,717)	$	—	$	(1,717)
Net cash used in investing activities	$	(6,127)	$	—	$	(6,127)
Financing activities:
Payments on lines of credit	$	(13,208)	$	(221)	$	(13,429)
Net cash provided by (used in) financing activities	$	9,459	$	(221)	$	9,238

Use of Estimates

The preparation of our financial statements in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of income and expenses during the reporting period. Material estimates that are susceptible to significant change in the near term primarily relate to the determination of accounts receivable, loans to mobile home parks, consumer loans, other notes receivable, inventory obsolescence, income taxes, fair value of financial instruments and contingent liabilities. Actual results could differ from these estimates.

Revenue Recognition

Product sales primarily consist of sales of mobile homes to consumers and mobile home parks through various sales channels, which include Direct Sales, Commercial Sales, Consignment Sales, and Retail Store Sales. Direct Sales include homes sold directly to independent retailers or customers that are not financed by the Company and are not sold under a consignment arrangement. These types of homes are generally paid for prior to shipment. Commercial Sales include homes sold to mobile home parks under commercial loan programs or paid for upfront. The Company provides floor plan financing for independent retailers, which takes the form of a consignment arrangement. Consignment Sales are considered sales of consigned homes from independent dealers to individual customers. Retail Store Sales are homes sold through Company-owned retail locations. Consignment Sales and Retail Sales of homes may be financed by the Company, by a third party, or paid in cash.

Revenue from product sales is recognized at a point in time when the performance obligation under the terms of a contract with our customer is satisfied, which typically occurs upon delivery and transfer of title of the home, as this depicts when control of the promised good is transferred to our customer. For financed sales by the Company, the individual customer enters into a sales and financing contract and is required to make a down payment. These financed sales contain a significant financing component and any interest income is separately recorded in the statement of income.

Revenue is measured as the amount of consideration expected to be received in exchange for transferring the homes to the customers. Sales and other similar taxes collected concurrently with revenue-producing activities are excluded from revenue.

The Company made an accounting policy election to account for any shipping and handling costs that occur after the transfer of control as a fulfillment cost that is accrued when control is transferred. Warranty obligations associated with the sale of a unit are assurance-type warranties for a period of twelve months that are a guarantee of the home’s intended functionality and, therefore, do not represent a distinct performance obligation within the context of the contract. The Company has elected to use the practical expedient to expense the incremental costs of obtaining a contract if the amortization period of the asset that the Company would have otherwise recognized is one year or less. Contract costs, which include commissions incurred related to the sale of homes, are expensed at the point-in-time when the related revenue is recognized. Warranty costs and contract costs are included in selling, general and administrative expenses in the statements of income.

For the three months ended March 31, 2022 and 2021, sales to an independent third-party and its affiliates accounted for $3,134 or 6.1% and $2,664 or 8.3% of our product sales, respectively.

For the three months ended March 31, 2022 and 2021, total cost of product sales included $2,999 and $2,182 of costs relating to subcontracted production for commercial sales, reimbursed dealer expenses for consignment sales, and certain other similar costs incurred for retail store and commercial sales.

Other revenue consists of consignment fees, commercial lease rents, service fees and other miscellaneous income. Consignment fees are charged to independent retailers on a monthly basis for homes held by the independent

retailers pursuant to a consignment arrangement until the home is sold to an individual customer. Consignment fees are determined as a percentage of the home’s wholesale price to the independent dealer. Revenue recognition for consignment fees are recognized over time using the output method as it provides a faithful depiction of the Company’s performance toward completion of the performance obligation under the contract and the value transferred to the independent retailer for the time the home is held under consignment. Revenue for commercial leases is recognized as earned monthly over a contractual period of 96 or 120 months. Revenue for service fees and miscellaneous income is recognized at a point in time when the performance obligation is satisfied.

Disaggregation of Revenue. The following table summarizes customer contract revenues disaggregated by source of the revenue for the three months ended March 31, 2022 and 2021:


	Three months ended
	March 31,
	2022		2021
Product sales:
Direct sales	$	10,863	$	3,422
Commercial sales		14,059		12,318
Consignment sales		20,040		10,599
Retail store sales		4,160		3,321
Other (1)		2,665		2,614
Total product sales		51,787		32,274
Consumer and MHP loans interest:
Interest - consumer installment notes		4,457		4,143
Interest - MHP notes		2,308		2,495
Total consumer and MHP loans interest		6,765		6,638
Other		1,376		1,028
Total net revenue	$	59,928	$	39,940

(1)

Other product sales revenue from ancillary products and services including parts, freight and other services

Share-Based Compensation

The Company accounts for share-based compensation in accordance with the provisions of Accounting Standards Codification (“ASC”) 718, Compensation—Stock Compensation. Share-based compensation expense is recognized based on the award’s estimated grant date fair value in order to recognize compensation cost for those shares expected to vest. The Company has elected to record forfeitures as they occur. Compensation cost is recognized on a straight-line basis over the vesting period of the awards and adjusted as forfeitures occur.

The fair value of each option grant with only service-based conditions is estimated using the Black-Scholes pricing model. The fair value of each restricted stock unit (the ”RSU”) with only service-based conditions is calculated based on the closing price of the Company’s common stock on the grant date. The fair value of each RSU with market based conditions is estimated using the Monte-Carlo Simulation valuation model.

The fair value of stock option awards on the date of grant is estimated using the Black-Scholes option pricing model, which requires the Company to make certain predictive assumptions. The risk-free interest rate is based on the implied yield of U.S. Treasury zero-coupon securities that correspond to the expected life of the award. As a recently formed public entity with a small public float and limited trading of its common shares on the NASDAQ Global Market, it was not practicable for the Company to estimate the volatility of its common shares; therefore, management estimated

volatility based on the historical volatilities of a small group of companies considered as close to comparable to the Company as available, all equally weighted, over the expected life of the option. Management concluded that this group is more characteristic of the Company’s business than a broad industry index. The expected life of awards granted represents the period of time that the awards are expected to be outstanding based on the “simplified” method, which is allowed for companies that cannot reasonably estimate the expected life of options based on its historical award exercise experience. The Company does not expect to pay dividends on its common stock.

The fair value of RSU awards with market based conditions on the date of grant is estimated using the Monte-Carlo Simulation valuation model, and the Company uses the following methods to determine its underlying assumptions: expected volatilities are based on the Company’s historic stock price volatility; the expected term of the awards is based on performance measurement period; the risk-free interest rate is based on the U.S. Treasury bond yield issued with similar life terms to the expected life of the grant. The Company does not expect to pay dividends on its common stock.

Accounts Receivable

Included in accounts receivable “net” are receivables from direct sales of mobile homes, sales of parts and supplies to customers, consignment fees and interest. Accounts receivable “dealer financed” are receivables for interest, fees and curtailments owed from dealers under their inventory finance agreements.

Accounts receivables “net” are generally due within 30 days and are stated at amounts due from customers net of an allowance for doubtful accounts. Accounts receivables “dealer financed” are due upon receipt and are stated at amounts due from customers net of an allowance for doubtful accounts. Accounts outstanding longer than the contractual payment terms are considered past due. The Company determines the allowance by considering several factors, including the aging of the past due balance, the customer’s payment history, and the Company’s previous loss history. The Company establishes an allowance for doubtful accounts for amounts that are deemed to be uncollectible. At March 31, 2022 and December 31, 2021, the allowance for doubtful accounts totaled $375 and $343, respectively.

Leased Property

The Company offers mobile home park operators the opportunity to lease mobile homes for rent in lieu of purchasing the homes for cash or under a longer-term financing agreement. In this arrangement title for the mobile homes remains with the Company.

The standard lease agreement is typically for 96 months or 120 months. Under the lease arrangement, the lessee (mobile home park operator) uses the mobile homes as personal property to be rented as a residence at the lessee's mobile home park. The lessee makes monthly, periodic lease payments to the Company over the term of the lease. The lessee is responsible for maintaining the homes during the term of the lease. The lessee is also responsible for repairing all damages caused by force majeure events even in cases of total or partial loss of the property. At the end of the lease term or in the event of default, the lessee is required to deliver to the Company the homes with all improvements in good repair and condition in substantially the same condition as existed at the commencement of the lease. The lessee may terminate the lease with 30 days written notice to the Company and pay a lease termination fee equal to 10% of the remaining lease payments or six month’s rent, whichever is greater. The lessee has an option to purchase the homes at the end of the lease term for fair market value based on an agreed upon determination of fair market value by both parties using comparable sales, recent appraisal, or NADA official guidance. The lessee must provide the Company with 30 days written notice prior to expiration of the lease of intent to purchase the property for fair market value. The lease also includes a renewal option whereby the lessee has the option to extend the lease for an additional 48 months (the extended term) at the same terms and conditions as the original lease. The lessee must notify the Company of the intent to exercise the renewal extension option not less than six months prior to expiration of the lease term. The leased mobile homes are included in other assets on the Company’s balance sheet, capitalized at manufactured cost and depreciated over a 15 year useful life. Homes returned to the Company upon expiration of the lease or in the event of default will be sold by the Company through its standard sales and distribution channels.

Future minimum lease income under all operating leases for each of the next five years at March 31, 2022, are as follows:


2022	$	1,563
2023		2,091
2024		2,091
2025		2,091
2026		2,091
Thereafter		4,685
Total	$	14,612

Recent Accounting Pronouncements

The Company has elected to use longer phase-in periods for the adoption of new or revised financial accounting standards under the JOBS Act as an emerging growth company.

In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842), to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. A lessee should recognize in the balance sheet a liability to make lease payments (the lease liability) and an asset representing its right to use the underlying asset for the lease term. As an emerging growth company, ASU 2016-02 is effective for fiscal years beginning after December 15, 2021, and interim periods within those years. The Company adopted this standard in the first quarter of fiscal 2022 and elected certain practical expedients permitted under the transition guidance, including the package of practical expedients; however, the Company did not elect the hindsight practical expedient. Additionally, the Company elected the optional transition method that allowed for a cumulative-effect adjustment in the period of adoption and did not restate prior periods. The adoption of ASU 2016-02 resulted in an increase in total assets and total liabilities of $3,258 at transition. However, this standard did not have a material impact on the consolidated statement of income or the consolidated statement of cash flows. See Note 5 for further discussion on leases.

In June 2016, the FASB issued ASU 2016-13 Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which amends guidance on reporting credit losses for assets held at amortized cost basis and available for sale debt securities. For assets held at amortized cost basis, Topic 326 eliminates the probable initial recognition threshold in current GAAP and, instead, requires an entity to reflect its current estimate of all expected credit losses. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected. For available for sale debt securities, credit losses should be measured in a manner similar to current GAAP, however Topic 326 will require that credit losses be presented as an allowance rather than as a write-down and affects entities holding financial assets and net investment in leases that are not accounted for at fair value through net income. The amendments affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. The Company plans to use the longer phase-in period for adoption, and accordingly this ASU is effective for the Company’s fiscal year beginning January 1, 2023. The Company is continuing to evaluate the impact of the adoption of this ASU and is uncertain of the impact on the financial statements and disclosures at this point in time.

From time to time, new accounting pronouncements are issued by the FASB and other regulatory bodies that are adopted by the Company as of the specified effective dates. Unless otherwise discussed, management believes that the impact of recently issued standards, which are not yet effective, will not have a material impact on the Company’s financial statements upon adoption.

CONSUMER LOANS

3 Months Ended

Mar. 31, 2022

CONSUMER LOANS

CONSUMER LOANS

2. CONSUMER LOANS

Consumer loans result from financing transactions entered into with retail consumers of mobile homes sold through independent retailers and company-owned retail locations. Consumer loans receivable generally consist of the sales price and any additional financing fees, less the buyer’s down payment. Interest income is recognized monthly per the terms of the financing agreements. The average contractual interest rate per loan was approximately 13.5% as of March 31, 2022 and December 31, 2021, respectively. Consumer loans receivable have maturities that range from 3 to 30 years.

Loan applications go through an underwriting process that considers credit history to evaluate credit risk of the consumer. Interest rates on approved loans are determined based on consumer credit score, payment ability and down payment amount.

The Company uses payment history to monitor the credit quality of the consumer loans on an ongoing basis.

The Company may also receive escrow payments for property taxes and insurance included in its consumer loan collections. The liabilities associated with these escrow collections totaled $9,142 and $9,350 as of March 31, 2022 and December 31, 2021, respectively, and are included in escrow liability in the condensed balance sheets.

Allowance for Loan Losses—Consumer Loans Receivable

The allowance for loan losses reflects management’s estimate of losses inherent in the consumer loans that may be uncollectible based upon review and evaluation of the consumer loan portfolio as of the date of the condensed balance sheet. An allowance for loan losses is determined after giving consideration to, among other things, the loan characteristics, including the financial condition of borrowers, the value and liquidity of collateral, delinquency and historical loss experience.

The allowance for loan losses is comprised of two components: the general reserve and specific reserves. The Company’s calculation of the general reserve considers the historical loss rate for the last three years, adjusted for the estimated loss discovery period and any qualitative factors both internal and external to the Company. Specific reserves are determined based on probable losses on specific classified impaired loans.

The Company’s policy is to place a loan on nonaccrual status when there is a clear indication that the borrower’s cash flow may not be sufficient to meet payments as they become due, which is when either principal or interest is past due and remains unpaid for more than 90 days or other indications of distress. Management implemented this policy based on an analysis of historical data, current performance of loans and the likelihood of recovery once principal or interest payments became delinquent and were aged more than 90 days. Payments received on nonaccrual loans are accounted for on a cash basis, first to interest and then to principal, as long as the remaining book balance of the asset is deemed to be collectible. The accrual of interest resumes when the past due principal or interest payments are brought within 90 days of being current.

Impaired loans are those loans where it is probable the Company will be unable to collect all amounts due in accordance with the original contractual terms of the loan agreement, including scheduled principal and interest payments. Impaired loans, or portions thereof, are charged off when deemed uncollectible. A loan is generally deemed impaired if it is more than 90 days past due on principal or interest, is in bankruptcy proceedings, or is in the process of repossession. A specific reserve is created for impaired loans based on fair value of underlying collateral value, less estimated selling costs. The Company uses various factors to determine the value of the underlying collateral for impaired loans. These factors are: (1) the length of time the unit was unsold after construction; (2) the amount of time the house was occupied; (3) the cooperation level of the borrowers, i.e., loans requiring legal action or extensive field collection efforts; (4) units located on private property as opposed to a manufactured home park; (5) the length of time the borrower has lived in the house without making payments; (6) location, size, and market conditions; and (7) the experience and expertise of the particular dealer assisting in collection efforts.

Collateral for repossessed loans is acquired through foreclosure or similar proceedings and is recorded at the estimated fair value of the home, less the costs to sell. At repossession, the fair value of the collateral is computed based on the historical recovery rates of previously charged off loans; the loan is charged off and the loss is charged to the allowance for loan losses. At each reporting period, the fair value of the collateral is adjusted to the lower of the amount recorded at repossession or the estimated sales price less estimated costs to sell, based on current information. Repossessed homes totaled $793 and $517 as of March 31, 2022 and December 31, 2021, respectively, and are included in other assets in the condensed balance sheets.

Consumer loans receivable, net of allowance for loan losses and deferred financing fees, consists of the following:


	As of March 31,		As of December 31,
	2022		2021
Consumer loans receivable	$	130,539	$	129,119
Loan discount and deferred financing fees		(2,556)		(2,612)
Allowance for loan losses		(724)		(884)
Consumer loans receivable, net	$	127,259	$	125,623

The following table presents a detail of the activity in the allowance for loan losses:


	Three Months Ended March 31,
	2022		2021
Allowance for loan losses, beginning of period	$	884	$	905
Provision for loan losses		(309)		535
Charge offs (recoveries)		149		(513)
Allowance for loan losses	$	724	$	927

The reserve for loan losses consists of the following:


	As of March 31,		As of December 31,
	2022		2021
Total consumer loans	$	130,539	$	129,119
Allowance for loan losses	$	724	$	884
Impaired loans individually evaluated for impairment	$	1,274	$	1,239
Specific reserve against impaired loans	$	452	$	533
Other loans collectively evaluated for allowance	$	129,265	$	127,880
General allowance for loan losses	$	272	$	351

As of March 31, 2022 and December 31, 2021, the total principal outstanding for consumer loans on nonaccrual status was $1,274 and $1,239, respectively. A detailed aging of consumer loans receivable that are past due as of March 31, 2022 and December 31, 2021 were as follows:


	As of March 31,			As of December 31,
	2022		%	2021		%
Total consumer loans receivable	$	130,539	100.0	$	129,119	100.0
Past due consumer loans:
31 - 60 days past due	$	243	0.2	$	594	0.5
61 - 90 days past due		111	0.1		407	0.3
91 - 120 days past due		109	0.1		114	0.1
Greater than 120 days past due		1,071	0.8		967	0.7
Total past due	$	1,534	1.2	$	2,082	1.6

NOTES RECEIVABLE FROM MOBILE HOME PARKS

3 Months Ended

Mar. 31, 2022

NOTES RECEIVABLE FROM MOBILE HOME PARKS

NOTES RECEIVABLE FROM MOBILE HOME PARKS

3. NOTES RECEIVABLE FROM MOBILE HOME PARKS

The notes receivable from mobile home parks (“MHP Notes”) relate to mobile homes sold to mobile home parks and financed through notes receivable. The MHP Notes have varying maturity dates and call for monthly principal and interest payments. The interest rate on the MHP Notes can be fixed or variable. Approximately $98 million of the MHP Notes have a fixed interest rate ranging from 6.9% to 8.9%. The remaining MHP Notes have a variable rate typically set at 4.0% above prime with a minimum of 8.0%. The average interest rate per loan was approximately 7.7% and 7.6% as of March 31, 2022 and December 31, 2021, respectively, with maturities that range from 1 to 18 years. The collateral underlying the MHP Notes are individual mobile homes which can be repossessed and resold. The MHP Notes are generally guaranteed by the borrowers personally.

As of March 31, 2022, the Company had concentrations of MHP Notes with two independent third-parties and their respective affiliates that equaled 29.1% and 12.9% of the principal balance outstanding, all of which was secured by the mobile homes. As of December 31, 2021, the Company had concentrations of MHP Notes with two independent third-parties and their respective affiliates that equaled 30.1% and 10.4% of the principal balance outstanding, all of which was secured by the mobile homesrespectively.

MHP Notes are stated at amounts due from customers, net of allowance for loan losses. The Company determines the allowance by considering several factors including the aging of the past due balance, the customer’s payment history, and the Company’s previous loss history. The Company establishes an allowance reserve composed of specific and general reserve amounts. As of March 31, 2022 and December 31, 2021, the MHP Note balance is presented net of unamortized finance fees of $591 and $445, respectively. The finance fees are amortized over the life of the MHP Notes.

There were minimal past due balances on the MHP Notes as of March 31, 2022 and December 31, 2021 and no charge offs were recorded for MHP Notes during the three months ended March 31, 2022 and 2021, respectively. Allowance for loan loss is considered immaterial and accordingly no loss is recorded against the MHP Notes as of March 31, 2022 and December 31, 2021.

There were no impaired MHP Notes as of March 31, 2022 and December 31, 2021, respectively, and there were no repossessed homes balances as of March 31, 2022 and December 31, 2021, respectively. Collateral for repossessed loans is acquired through foreclosure or similar proceedings and is recorded at the estimated fair value of the home, less the costs to sell.

OTHER NOTES RECEIVABLE

3 Months Ended

Mar. 31, 2022

OTHER NOTES RECEIVABLE

OTHER NOTES RECEIVABLE

4. OTHER NOTES RECEIVABLE

Other notes receivable relate to various notes issued to mobile home park owners and dealers, which are not directly tied to sales of mobile homes. The other notes have varying maturity dates and call for monthly principal and interest payments. The other notes are collateralized by mortgages on real estate, units being financed and used as offices, as well as vehicles, and are typically guaranteed by the borrowers personally. The interest rate on the other notes are fixed and range from 5.00% to 12.00%. The Company reserves for estimated losses on the other notes based on current economic conditions that may affect the borrower’s ability to pay, the borrower’s financial strength, and historical loss experience. There were no past due balances for other notes as of March 31, 2022 and December 31, 2021, respectively, and there were no impaired balances for other notes as of March 31, 2022 and December 31, 2021, respectively.

The balance outstanding on the other notes receivable were as follows:


	As of March 31,		As of December 31,
	2022		2021
Outstanding principal balance	$	38,800	$	42,074
Allowance for loan losses		(52)		(74)
Total	$	38,748	$	42,000

LEASES

3 Months Ended

Mar. 31, 2022

LEASES

LEASES

5. LEASES

The Company currently has 13 operating leases, 8 of which are for the Company’s Heritage Housing and Tiny Homes retail locations, three which are subleased by the Company and two are for corporate and administrative offices in Bedford, TX and Norcross, GA. These leases typically have initial terms ranging from 5 to 10 years and include one or more options to renew.

Under ASC 842, a modified retrospective transition is required, applying the new standard to all leases at the date of initial application. The Company chose to use the adoption date of January 1, 2022 for ASC 842. As such, all periods presented after January 1, 2022, are under ASC 842 whereas periods presented prior to January 1, 2022, are in accordance with prior lease accounting of ASC 840. Financial information was not updated and the disclosures required under ASC 842 were not provided for dates and periods before January 1, 2022.

We determine if an arrangement is a lease at inception. Operating leases are right-of-use (“ROU”) assets and are shown as ROU assets – operating leases on our Condensed Balance Sheet. The lease liabilities are shown as Operating lease obligation and Operating lease obligation, less current portion on our Condensed Balance Sheet. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease.

ROU assets and liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. We have elected the practical expedient to not separate lease and non-lease components. Therefore, lease payments included in the measurement of the lease liability include all fixed payments in the lease arrangement. We record a ROU asset for an amount equal to the lease liability, increased for any prepaid lease costs and initial direct costs and reduced by any lease incentives. We remeasure the lease liability and ROU asset when a change to our future minimum lease payments occurs. Key assumptions and judgments included in the determination of the lease liability include the discount rate used in the present value calculation and the exercise of renewal options.

Many of our leases contain renewal options. As the exercise of the renewal options is not certain at commencement of a lease, we generally do not include the option periods in the lease term when determining the lease

liabilities and ROU assets. We remeasure the lease liability and ROU asset when we are reasonably certain that we will exercise a renewal option.

Our leases do not provide information about the rate implicit in the lease. Therefore, we utilize an incremental borrowing rate to calculate the present value of our future lease obligations. The incremental borrowing rate represents the rate of interest we would have to pay on a collateralized borrowing, for an amount equal to the lease payments, over a similar term and in a similar economic environment. The remaining weighted-average lease term is 5.2 years and the weighted-average discount rate is 2.12%.

We consider lease payments that cannot be predicted with reasonable certainty upon lease commencement to be variable lease payments, which are recorded as incurred each period and are excluded from our calculation of lease liabilities. There were no variable lease costs for the three months ended March 31, 2022.

Short-term leases, those with a term of 12 months or less, are not recorded on our Condensed Balance Sheet. Our short-term lease costs were not material for the three months ended March 31, 2022.

As of March 31, 2022, future minimum lease payments under our operating lease liabilities were as follows:


2022	$	522
2023		709
2024		644
2025		608
2026		546
Thereafter		429
Total lease payments	$	3,458
Less amount representing interest		(100)
Total lease liability	$	3,358
Less current lease liability		(652)
Total non-current lease liability	$	2,706

INVENTORIES

3 Months Ended

Mar. 31, 2022

INVENTORIES

INVENTORIES

6. INVENTORIES

Inventories consists of the following:


	As of March 31,		As of December 31,
	2022		2021
Raw materials	$	19,199	$	15,431
Work in progress		799		714
Finished goods (1)		31,825		28,195
Allowance for obsolescence		(302)		(432)
Total	$	51,521	$	43,908

(1)

Finished goods includes $3,738 and $2,678 as of March 31, 2022 and December 31, 2021, respectively, held for more than twelve months and classified as long-term.

PROPERTY, PLANT AND EQUIPMENT

3 Months Ended

Mar. 31, 2022

PROPERTY, PLANT AND EQUIPMENT

PROPERTY, PLANT AND EQUIPMENT

7. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment consists of the following:


	As of March 31,		As of December 31,
	2022		2021
Land	$	14,949	$	14,949
Buildings and leasehold improvements		13,863		13,722
Vehicles		1,702		1,682
Machinery and equipment		5,841		5,058
Furniture and fixtures		300		298
Total		36,655		35,709
Less accumulated depreciation		(8,639)		(8,193)
Total property, plant and equipment	$	28,016	$	27,516

Depreciation expense was $260 with $121 included as a component of cost of product sales for the three months ended March 31, 2022 and $264 with $104 included as a component of cost of product sales for the three months ended March 31, 2021.

OTHER ASSETS

3 Months Ended

Mar. 31, 2022

OTHER ASSETS.

OTHER ASSETS

8. OTHER ASSETS

Other assets consists of the following:


	As of March 31,		As of December 31,
	2022		2021
Prepaid rent	$	355	$	248
Other		332		332
Repossessed homes		793		517
Total	$	1,480	$	1,097

Depreciation expense for the leased property was $170 and $98 for the three months ended March 31, 2022 and 2021, respectively.

ACCRUED LIABILITIES

3 Months Ended

Mar. 31, 2022

ACCRUED LIABILITIES.

ACCRUED LIABILITIES

9. ACCRUED LIABILITIES

Accrued liabilities consists of the following:


	As of March 31,		As of December 31,
	2022		2021
Warranty reserve	$	2,047	$	2,876
Litigation reserve		2,707		2,764
Payroll		2,399		1,685
Portfolio taxes and title		2,399		2,467
Property tax		233		546
Dealer rebates		838		1,160
Sales tax		66		310
Federal and state income taxes		7,939		7,445
Other		1,370		1,433
Total accrued liabilities	$	19,998	$	20,686

DEBT

3 Months Ended

Mar. 31, 2022

DEBT

DEBT

10. DEBT

Lines of Credit

Revolver 1

At December 31, 2019, the Company had a revolving line of credit (“Revolver 1”) with Capital One, N.A. with a maximum credit limit of $45,000 and a maturity date of May 11, 2020. On March 30, 2020, the Company entered into an agreement with Capital One, N.A. to replace Revolver 1 with a new revolving line of credit (“New Revolver”). The New Revolver has a maximum credit limit of $70,000 and a maturity date of March 30, 2024. For the period January 1, 2020 through March 30, 2020, Revolver 1 accrued interest at one-month LIBOR plus 2.40%. Amounts available under Revolver 1 were subject to a formula based on eligible consumer loans and MHP Notes and were secured by all accounts receivable, consumer loans and MHP Notes.

The New Revolver accrues interest at one-month LIBOR plus 2.00%. The interest rate in effect as of March 31, 2022 and December 31, 2021 was 2.23% and 2.10%, respectively. As with Revolver 1, amounts available under the New Revolver are subject to a formula based on eligible consumer loans and MHP Notes and are secured by all accounts receivable, consumer loans and MHP Notes. The amount of available credit under the New Revolver was $64,923 and $61,841 as of March 31, 2022 and December 31, 2021, respectively. In connection with the New Revolver, the Company paid certain arrangement fees and other fees of approximately $295, which were capitalized as unamortized debt issuance costs and will be amortized to interest expense over the life of the New Revolver.

For the three months ended March 31, 2022 and 2021, interest expense under the New Revolver was $56 and $226, respectively. The outstanding balance as of March 31, 2022 and December 31, 2021 was $5,224 and $8,159, respectively. The New Revolver requires the Company to comply with certain financial and non-financial covenants. As of March 31, 2022, the Company was in compliance with all financial covenants, including that it maintain a tangible net worth of at least $120,000 and that it maintain a ratio of debt to EBITDA of 4 to 1, or less. As of March 31, 2022, the Company was not in compliance with certain non-financial covenants and obtained a waiver from Capital One.

PILOT Agreement

In December 2016, the Company entered into a Payment in Lieu of Taxes (“PILOT”) agreement commonly offered in Georgia by local community development programs to encourage industry development. The net effect of the PILOT agreement is to provide the Company with incentives through the abatement of local, city and county property

taxes and to provide financing for improvements to the Company’s Georgia plant (the “Project”). In connection with the PILOT agreement, the Putman County Development Authority provides a credit facility for up to $10,000, which can be drawn upon to fund Project improvements and capital expenditures as defined in the agreement. If funds are drawn, the Company would pay transaction costs and debt service payments. The PILOT agreement requires interest payments of 6.00% per annum on outstanding balances, which are due each December 1st through maturity on December 1, 2021, at which time all unpaid principal and interest are due. The PILOT agreement is collateralized by the assets of the Project. As of March 31, 2022, the Company had not drawn on this credit facility.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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+ Details

SHARE BASED COMPENSATION

3 Months Ended

Mar. 31, 2022

SHARE BASED COMPENSATION

SHARE BASED COMPENSATION

11. SHARE-BASED COMPENSATION

Pursuant to the Legacy Housing Corporation 2018 Incentive Compensation Plan (the “Compensation Plan”), the Company may issue up to 10.0 million equity awards to employees, directors, consultants and nonemployee service providers in the form of stock options, stock and stock appreciation rights. Stock options may be granted with a contractual life of up to ten years. At March 31, 2022, the Company had 9.2 million shares available for grant under the Compensation Plan.

In February 2019, the Company granted 120,000 restricted shares of its common stock to members of senior management. The shares were granted on February 7, 2019 and had a grant date fair value of $1,636. The shares vest at a rate of 14.3% annually, beginning on February 7, 2019, and becoming fully vested on February 7, 2025. During the second quarter of 2020, 42,857 of these restricted shares were forfeited due to the departure of a member of senior management.

In December 2020, the Company granted 2,022 restricted shares of its common stock to the independent directors on the Company’s Board of Directors. The shares were granted on December 2, 2020 and had a grant date fair value of $30. The shares become fully vested on October 4, 2021.

In November 2021, the Company granted 1,202 restricted shares of its common stock to the independent directors on the Company’s Board of Directors. The shares were granted on November 30, 2021 and had a grant date fair value of $30. The shares become fully vested on October 24, 2022.

In January 2022, the Company granted 150,000 restricted shares of its common stock to the Executive Chairman of the Company pursuant to an amended and restated employment agreement. The shares were granted on January 6, 2022 and had a grant date fair value of $3,741. The shares became fully vested upon grant.

On January 6, 2022, the Company gave contingent equity awards of 350,000 shares of the Company’s restricted stock to the Executive Chairman of the Company pursuant to an amended and restated employment agreement. An equity award of 175,000 shares will be granted if the Company’s stock price reaches and remains for a period of fifteen consecutive market days at a closing price of $36 per share (the “$36 Equity Award”). The $36 Equity Awards had a grant date fair value of $1,412 and fifty percent of the shares shall be vested when the consecutive closing price condition is met and fifty percent shall vest on June 16, 2024, so long as the Executive Chairman is employed by the Company on that date. An additional equity award of 175,000 shares of the Company’s restricted stock will be granted if the Company’s stock price reaches and remains for a period of fifteen consecutive market days at a closing price of $48 per share (the “$48 Equity Award”). The $48 Equity Awards had a grant date fair value of $683 and fifty percent of the shares shall be vested when the consecutive closing price condition is met and fifty percent shall vest on June 16, 2024, so long as the Executive Chairman is employed by the Company on that date. As of March 31, 2022, none of the conditions have been met for the vesting of the $36 Equity Awards or the $48 Equity Awards.

The following is a summary of restricted stock units (the “RSU”) activity (in thousands, except per unit data):


	Number of Units		Weighted Average Grant Date Fair Value Per Unit
Nonvested, January 1, 2022	35	$	14.01
Granted	500	$	11.67
Vested	(158)	$	24.33
Nonvested, March 31, 2022	377	$	6.57

As of March 31, 2022, approximately 377,000 RSUs remained unvested. Unrecognized compensation expense related to these RSUs at March 31, 2022 was $2,238 and is expected to be recognized over 2.30 years.

The Company granted 34,626 incentive stock options to a member of senior management. The options were granted on August 10, 2020 at an exercise price of $14.44 per share. The options vest at a rate of 20.0% annually, beginning on August 10, 2021, and becoming fully vested on August 10, 2025. All options expire ten years after the date of grant. Weighted-average assumptions used in the Black-Scholes option pricing model for stock options granted were as follows: risk free interest rate of 0.24%; dividend yield of 0.00%; expected volatility of common stock of 75.0% and expected life of options of 6.5 years. During the first quarter of 2022, 27,701 of these options were forfeited due to the departure of the senior manager.

The Company granted 55,490 incentive stock options to a member of management. The options were granted on September 23, 2021 at an exercise price of $18.02 per share. The options vest at a rate of 10.0% annually, beginning on September 23, 2022, and becoming fully vested on September 23, 2031. All options expire ten years after the date of grant. Weighted-average assumptions used in the Black-Scholes option pricing model for stock options granted were as follows: risk free interest rate of 1.41%; dividend yield of 0.00%; expected volatility of common stock of 75.0% and expected life of options of 7.8 years.

The following is a summary of option activity (in thousands, except per unit data):


	Number of Units	Weighted Average Exercise Price Per Unit		Weighted Average Grant Date Fair Value Per Unit		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value
Outstanding, January 1, 2022, nonvested	83	$	16.83	$	12.27	9.36
Granted	—	$	—	$	—	—
Exercised	—	$	—	$	—	—
Forfeited	(28)		14.44		8.67	—
Outstanding, March 31, 2022, nonvested	55	$	18.02	$	14.07	9.49	$	191
Exercisable, March 31, 2022	—	$	—	$	—	—	$	—

As of March 31, 2022, approximately 55,000 options remained nonvested. Unrecognized compensation expense related to these options at March 31, 2022 was $740 and is expected to be recognized over 9.49 years.

On March 31, 2020, the Company filed a registration statement on Form S-8 to register with the SEC approximately 2.3 million shares of Legacy common stock available for issuance under the 2018 Incentive Compensation Plan. The registration statement became effective upon filing.

INCOME TAXES

3 Months Ended

Mar. 31, 2022

INCOME TAXES

INCOME TAXES

12. INCOME TAXES

The provision for income tax expense for the three months ended March 31, 2022 and 2021 was $3,558 and $2,208, respectively. The effective tax rate for the three months ended March 31, 2022 was 18.1% and differs from the federal statutory rate of 21% primarily due to a federal tax credit for energy efficient construction and partially offset by state income taxes. The effective tax rate for the three months ended March 31, 2021 was 17.1% and differs from the federal statutory rate of 21% primarily due to a federal tax credit for energy efficient construction and partially offset by state income taxes.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

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+ Details

COMMITMENTS AND CONTINGENCIES

3 Months Ended

Mar. 31, 2022

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

13. COMMITMENTS AND CONTINGENCIES

As of January 1, 2020, the Company instituted a self-insured health benefits plan with a stop-loss policy, which provides medical benefits to employees electing coverage under the plan. The Company estimates and records costs for incurred but not reported medical claims and claim development. This reserve is based on historical experience and other assumptions, some of which are subjective. The Company will adjust its self-insured medical benefits reserve based on actual experience, estimated costs and changes to assumptions. At March 31, 2022 and December 31, 2021, the Company accrued a $326 and $373, respectively, liability for incurred but not reported claims.

The Company is contingently liable under terms of repurchase agreements with financial institutions providing inventory financing for independent retailers of its products. These arrangements, which are customary in the industry, provide for the repurchase of products sold to retailers in the event of default by the retailer. The Company’s obligation under these repurchase agreements ceases upon the purchase of the home by the retail customer. The maximum amount for which the Company was liable under such agreements totaled $14,749 and $4,908 at March 31, 2022 and December 31, 2021, respectively, without reduction for the resale value of the homes. The Company considers its obligations on current contracts to be insignificant and accordingly have not recorded any reserve for repurchase commitment as of March 31, 2022 and December 31, 2021.

Leases. The Company leases facilities under operating leases that typically have 10-year terms. These leases usually offer the Company a right of first refusal that affords the Company the option to purchase the leased premises under certain terms in the event the landlord attempts to sell the leased premises to a third party. Rent expense was $163 and $151 for the three months ended March 31, 2022 and 2021, respectively. The Company also subleases properties to third parties, ranging from 3-year to 11-year terms with various renewal options. Rental income from the subleased property was approximately $82 and $91 for the three months ended March 31, 2022 and 2021, respectively. See Note 5 – Leases, for a schedule of the Company’s future minimum lease commitments.

Legal Matters

The Company is party to certain legal proceedings that arise in the ordinary course and are incidental to its business. Certain of the claims pending against the Company in these proceedings allege, among other things, breach of contract and warranty, product liability and personal injury. The Company has determined that it is probable that it has some liability related to the claims. The Company has included legal reserves of $2,707 and $2,764 as of March 31, 2022 and December 31, 2021, respectively, in accrued liabilities on the accompanying balance sheets. Although litigation is inherently uncertain, based on past experience and the information currently available, management does not believe that the currently pending and threatened litigation or claims will have a material adverse effect on the Company’s financial position, liquidity or results of operations. However, future events or circumstances currently unknown to management will determine whether the resolution of pending or threatened litigation or claims will ultimately have a material effect on the Company’s financial position, liquidity or results of operations in any future reporting periods.

DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

3 Months Ended

Mar. 31, 2022

DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

14. DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

Derivative Financial Instruments

On February 2, 2012, the Company entered into a master interest rate swap agreement. The Company elected not to designate the interest rate swap agreements as cash flow hedges and, therefore, gains or losses on the agreements as well as the other offsetting gains or losses on the hedged items attributable to the hedged risk are recognized in current earnings. ASC 815-10, Derivatives and Hedging, requires derivative instruments to be measured at fair value and recorded in the statements of financial position as either assets or liabilities. The Company entered into interest rate swap agreement with Capital One Bank on June 12, 2017 to fix the variable rate portion for $8,000 of the line of credit. This interest rate swap agreement matured on May 11, 2020.

Fair Value Measurements

The Company accounts for its investments and derivative instruments in accordance with ASC 820-10, Fair Value Measurement, which among other things provides the framework for measuring fair value. That framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level I measurement) and the lowest priority to unobservable inputs (Level III measurements). The three levels of fair value hierarchy under ASC 820-10, Fair Value Measurement, are as follows:

Level I Quoted prices are available in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

Level II Significant observable inputs other than quoted prices in active markets for which inputs to the valuation methodology include: (1) Quoted prices for similar assets or liabilities in active markets; (2) Quoted prices for identical or similar assets or liabilities in inactive markets; (3) Inputs other than quoted prices that are observable; (4) Inputs that are derived principally from or corroborated by observable market data by correlation or other means. If the asset or liability has a specified (contractual) term, the Level II input must be observable for substantially the full term of the asset or liability.

Level III Significant unobservable inputs that reflect an entity’s own assumptions that market participants would use in pricing the assets or liabilities.

The asset or liability fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

The Company has used derivatives to manage risks related to interest rate movements. The Company does not enter into derivative contracts for speculative purposes. Interest rate swap contracts are recognized as assets or liabilities on the balance sheets and are measured at fair value. The fair value was calculated and provided by the lender, a Level II valuation technique. Management reviewed the fair values for the instruments as provided by the lender and determined the related asset and liability to be an accurate estimate of future gains and losses to the Company. The Company is not a party to any interest rate swaps as of March 31, 2022.

Fair Value of Financial Instruments

The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, consumer loans, MHP Notes, other note receivables, accounts payable, lines of credit, notes payable, and dealer portion of consumer loans.

The carrying amounts of cash and cash equivalents, accounts receivable, and accounts payable approximate their respective fair values because of the short-term maturities or expected settlement dates of these instruments. This is considered a Level I valuation technique. The lines of credit, notes payable, part of the MHP Notes and part of the other

note receivables have variable interest rates that reflect market rates and their fair value approximates their carrying value. This is considered a Level II valuation technique. The Company also assessed the fair value of the consumer loans receivable, the fixed rate MHP Notes and the portion of other note receivables with fixed rates based on the discounted value of the remaining principal and interest cash flows. The Company determined that the fair value of the consumer loan portfolio was approximately $127,600 compared to the book value of $127,259 as of March 31, 2022, and a fair value of approximately $125,600 compared to the book value of $125,623 as of December 31, 2021. The Company determined that the fair value of the fixed rate MHP Notes was approximately $92,000 compared to the book value of $97,782 as of March 31, 2022, and a fair value of approximately $83,000 compared to the book value of $83,773 as of December 31, 2021. The Company determined that the fair value of the other notes was approximately $33,300 compared to the book value of $38,748 as of March 31, 2022, and a fair value of approximately $38,500 compared to the book value of $38,886 as of December 31, 2021. This is a Level III valuation technique.

EARNINGS PER SHARE

3 Months Ended

Mar. 31, 2022

EARNINGS PER SHARE

EARNINGS PER SHARE

15. EARNINGS PER SHARE

Basic earnings per common share (“EPS”) is computed based on the weighted-average number of common shares outstanding during each reporting period. Diluted EPS is based on the weighted-average number of common shares outstanding plus the number of additional shares that would have been outstanding had the dilutive common shares been issued. The following table reconciles the numerators and denominators used in the computations of both basic and diluted EPS.


	Three months ended
	March 31,
	2022		2021
Numerator:
Net income (in 000's)	$	16,092	$	10,701
Denominator:
Basic weighted-average common shares outstanding		24,351,223		24,199,107
Effect of dilutive securities:
Restricted stock grants		267,515		5,126
Stock options		42,688		6,949
Diluted weighted-average common shares outstanding		24,661,426		24,211,182
Earnings per share attributable to Legacy Housing Corporation
Basic	$	0.66	$	0.44
Diluted	$	0.65	$	0.44

RELATED PARTY TRANSACTIONS

3 Months Ended

Mar. 31, 2022

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS

16. RELATED PARTY TRANSACTIONS

Bell Mobile Homes, a retailer owned by one of the Company’s significant owners, purchases manufactured homes from the Company. Accounts receivable balances due from Bell Mobile Homes were $139 and $1 as of March 31, 2022 and December 31, 2021, respectively. Accounts payable balances due to Bell Mobile Homes for maintenance and related services were $69 and $49 as of March 31, 2022 and December 31, 2021, respectively. Home sales to Bell Mobile Homes were $632 and $699 for the three months ended March 31, 2022 and 2021, respectively.

Shipley Bros., Ltd. (“Shipley Bros.”), a retailer owned by one of the Company’s significant shareholders, purchases manufactured homes from the Company. Accounts receivable balances due from Shipley Bros. were $424 and zero as of March 31, 2022 and December 31, 2021, respectively. Home sales to Shipley Bros. were $693 and $914 for the three months ended March 31, 2022 and 2021, respectively. There were no accounts payable balances due to Shipley Bros. as of March 31, 2022 and December 31, 2021, respectively.

SUBSEQUENT EVENTS

3 Months Ended

Mar. 31, 2022

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS

17. SUBSEQUENT EVENTS

On May 30, 2022, the Company submitted to Nasdaq a plan to regain compliance with Nasdaq Listing Rule 5250(c)(1) (the “Rule”) regarding the Company’s failure to file timely Form 10-K for the year ended December 31, 2021 and Form 10-Q for the period ended March 31, 2022. On June 9, 2022, the Company received a response from Nasdaq informing the Company that Nasdaq granted an exception to the filing requirements set forth in the Rule that allows the Company to file these reports and any other required filings as required by the Rule on or before September 27, 2022. On August 3, 2022, the Company filed Form 10-K for the year ended December 31, 2021.

On August 11, 2022, the Company received notice from Nasdaq regarding the Company’s failure to file timely Form 10-Q for the period ending June 30, 2022. As a result of this delinquency, the Company must submit an update to its original plan to regain compliance with the Rule. The updated plan must be submitted to Nasdaq by September 12, 2022.

On June 7, 2022, the Company entered into an employment agreement (the “Employment Agreement”) with Duncan Bates, to serve as President and Chief Executive Officer of the Company. The Employment Agreement provides for a term that commences on June 7, 2022 and expires on June 7, 2027 (the “Initial Employment Period”). The Employment Agreement provides for Mr. Bates to receive a base salary of $300 per year and a signing bonus of 14,700 shares of restricted stock, which shall vest 50% on June 7, 2023 and 50% on June 7, 2024. Mr. Bates also received 62,460 incentive stock options, an option to purchase 300,000 shares of the Company’s common stock at an exercise price of $36 per share and an option to purchase 600,000 shares of the Company’s common stock at an exercise price of $48 per share. The incentive stock options have an exercise price of $16.01 per share. The incentive stock options and the options to purchase shares vest at a rate of 10.0% annually, beginning on June 7, 2023, becoming fully vested on June 7, 2032.

On June 7, 2022, the Company granted 62,460 incentive stock options to Ronald Arrington, the Chief Financial Officer. The options were granted on June 7, 2022 at an exercise price of $16.01 per share. The options vest at a rate of 10.0% annually, beginning on June 7, 2023, and becoming fully vested on June 7, 2032.

On June 21, 2022, the Company received a Reservation of Rights notice from Capital One, N.A. The letter stated that the Company’s New Revolver was in default. The default condition occurred due to the Company’s failure to timely file the Form 10-K and deliver certain financial statement to Capital One, N.A. On July 28, 2022, the Company executed a forbearance agreement with Capital One, N.A.

On August 24, 2022, the Company received a Notice of Default and Partial Suspension of Loan Commitments from Capital One, N.A. The notice stated that the July 28, 2022 forbearance agreement had been terminated and that Capital One, N.A. was permitted to suspend $50,000 of the $70,000 loan commitment in the New Revolver. As a result, the available line of credit in the New Revolver is $20,000. The Company is not currently using any of the available credit under the New Revolver.

In connection with the preparation of these financial statements, an evaluation of subsequent events was performed through the date of filing. The Company recently updated its management of escrow collections. Historically, escrow collections were deposited in an unsegregated deposit account subject to the Company's credit agreement with Capital One, N.A. On June 28, 2022, the Company segregated escrow collections by purchasing an $8.5M certificate of deposit that is not subject to the credit agreement. The certificate of deposit principal amount will be adjusted periodically. The Company will continue to hold escrow collections separately from its other operating funds where required by law.

NATURE OF OPERATIONS (Policies)

3 Months Ended

Mar. 31, 2022

NATURE OF OPERATIONS

Basis of Presentation

Restatement of Previously Issued Condensed Financial Statements (unaudited)

Restatement of Previously Issued Condensed Financial Statements (unaudited)

The effects of the restatement on the line items within the Company’s condensed statement of operations for the three months ended March 31, 2021 were as follows:


	Three Months Ended March 31, 2021
	As
	Originally				As
	Reported		Adjustments		Restated
Operating expenses:
Cost of product sale	$	24,024	$	(2,023)	$	22,001
Income from operations	$	10,660	$	2,023	$	12,683
Income before income tax expense	$	10,886	$	2,023	$	12,909
Income tax expense	$	(1,862)	$	(346)	$	(2,208)
Net income	$	9,024	$	1,677	$	10,701
Net income per share:
Basic	$	0.37	$	0.07	$	0.44
Diluted	$	0.37	$	0.07	$	0.44

The effects of the restatement on the line items within the Company’s condensed statement of cash flows for the three months ended March 31, 2021 were as follows:


	Three months March 31, 2021
	As Originally				As
	Reported		Adjustments		Restated
Operating activities:
Net income	$	9,024	$	1,677	$	10,701
Inventories	$	(3,502)	$	—	$	(3,502)
Prepaid expenses and other current assets	$	(433)	$	553	$	120
Other assets	$	(5)	$	(332)	$	(337)
Accounts payable	$	(775)	$	(2,023)	$	(2,798)
Accrued liabilities	$	(1,183)	$	346	$	(837)
Net cash provided by (used in) operating activities	$	(1,692)	$	221	$	(1,471)
Investing activities:
Purchases of property, plant and equipment	$	(1,717)	$	—	$	(1,717)
Net cash used in investing activities	$	(6,127)	$	—	$	(6,127)
Financing activities:
Payments on lines of credit	$	(13,208)	$	(221)	$	(13,429)
Net cash provided by (used in) financing activities	$	9,459	$	(221)	$	9,238

Use of Estimates

Revenue Recognition

For the three months ended March 31, 2022 and 2021, sales to an independent third-party and its affiliates accounted for $3,134 or 6.1% and $2,664 or 8.3% of our product sales, respectively.

Disaggregation of Revenue. The following table summarizes customer contract revenues disaggregated by source of the revenue for the three months ended March 31, 2022 and 2021:


	Three months ended
	March 31,
	2022		2021
Product sales:
Direct sales	$	10,863	$	3,422
Commercial sales		14,059		12,318
Consignment sales		20,040		10,599
Retail store sales		4,160		3,321
Other (1)		2,665		2,614
Total product sales		51,787		32,274
Consumer and MHP loans interest:
Interest - consumer installment notes		4,457		4,143
Interest - MHP notes		2,308		2,495
Total consumer and MHP loans interest		6,765		6,638
Other		1,376		1,028
Total net revenue	$	59,928	$	39,940

(1)

Other product sales revenue from ancillary products and services including parts, freight and other services

Share-Based Compensation

Accounts Receivable

Leased Property

Future minimum lease income under all operating leases for each of the next five years at March 31, 2022, are as follows:


2022	$	1,563
2023		2,091
2024		2,091
2025		2,091
2026		2,091
Thereafter		4,685
Total	$	14,612

Recent Accounting Pronouncements

The Company has elected to use longer phase-in periods for the adoption of new or revised financial accounting standards under the JOBS Act as an emerging growth company.

Fair Value Measurements

Level I Quoted prices are available in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

Level III Significant unobservable inputs that reflect an entity’s own assumptions that market participants would use in pricing the assets or liabilities.

The asset or liability fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

Fair Value of Financial Instruments

NATURE OF OPERATIONS (Tables)

3 Months Ended

Mar. 31, 2022

NATURE OF OPERATIONS

Schedule of restatement of previously issued condensed consolidated financial statements

The effects of the restatement on the line items within the Company’s condensed statement of operations for the three months ended March 31, 2021 were as follows:


	Three Months Ended March 31, 2021
	As
	Originally				As
	Reported		Adjustments		Restated
Operating expenses:
Cost of product sale	$	24,024	$	(2,023)	$	22,001
Income from operations	$	10,660	$	2,023	$	12,683
Income before income tax expense	$	10,886	$	2,023	$	12,909
Income tax expense	$	(1,862)	$	(346)	$	(2,208)
Net income	$	9,024	$	1,677	$	10,701
Net income per share:
Basic	$	0.37	$	0.07	$	0.44
Diluted	$	0.37	$	0.07	$	0.44

The effects of the restatement on the line items within the Company’s condensed statement of cash flows for the three months ended March 31, 2021 were as follows:


	Three months March 31, 2021
	As Originally				As
	Reported		Adjustments		Restated
Operating activities:
Net income	$	9,024	$	1,677	$	10,701
Inventories	$	(3,502)	$	—	$	(3,502)
Prepaid expenses and other current assets	$	(433)	$	553	$	120
Other assets	$	(5)	$	(332)	$	(337)
Accounts payable	$	(775)	$	(2,023)	$	(2,798)
Accrued liabilities	$	(1,183)	$	346	$	(837)
Net cash provided by (used in) operating activities	$	(1,692)	$	221	$	(1,471)
Investing activities:
Purchases of property, plant and equipment	$	(1,717)	$	—	$	(1,717)
Net cash used in investing activities	$	(6,127)	$	—	$	(6,127)
Financing activities:
Payments on lines of credit	$	(13,208)	$	(221)	$	(13,429)
Net cash provided by (used in) financing activities	$	9,459	$	(221)	$	9,238

Schedule of disaggregation of revenue


	Three months ended
	March 31,
	2022		2021
Product sales:
Direct sales	$	10,863	$	3,422
Commercial sales		14,059		12,318
Consignment sales		20,040		10,599
Retail store sales		4,160		3,321
Other (1)		2,665		2,614
Total product sales		51,787		32,274
Consumer and MHP loans interest:
Interest - consumer installment notes		4,457		4,143
Interest - MHP notes		2,308		2,495
Total consumer and MHP loans interest		6,765		6,638
Other		1,376		1,028
Total net revenue	$	59,928	$	39,940

(1)

Other product sales revenue from ancillary products and services including parts, freight and other services

Schedule of future minimum lease income


2022	$	1,563
2023		2,091
2024		2,091
2025		2,091
2026		2,091
Thereafter		4,685
Total	$	14,612

CONSUMER LOANS (Tables)

3 Months Ended

Mar. 31, 2022

CONSUMER LOANS

Schedule of consumer loans, net of allowance for loan losses and deferred financing fees


	As of March 31,		As of December 31,
	2022		2021
Consumer loans receivable	$	130,539	$	129,119
Loan discount and deferred financing fees		(2,556)		(2,612)
Allowance for loan losses		(724)		(884)
Consumer loans receivable, net	$	127,259	$	125,623

Schedule of allowance for loan losses


	Three Months Ended March 31,
	2022		2021
Allowance for loan losses, beginning of period	$	884	$	905
Provision for loan losses		(309)		535
Charge offs (recoveries)		149		(513)
Allowance for loan losses	$	724	$	927

Schedule of impaired and general reserve for allowance for loan losses


	As of March 31,		As of December 31,
	2022		2021
Total consumer loans	$	130,539	$	129,119
Allowance for loan losses	$	724	$	884
Impaired loans individually evaluated for impairment	$	1,274	$	1,239
Specific reserve against impaired loans	$	452	$	533
Other loans collectively evaluated for allowance	$	129,265	$	127,880
General allowance for loan losses	$	272	$	351

Schedule of consumer loans receivable that are past due


	As of March 31,			As of December 31,
	2022		%	2021		%
Total consumer loans receivable	$	130,539	100.0	$	129,119	100.0
Past due consumer loans:
31 - 60 days past due	$	243	0.2	$	594	0.5
61 - 90 days past due		111	0.1		407	0.3
91 - 120 days past due		109	0.1		114	0.1
Greater than 120 days past due		1,071	0.8		967	0.7
Total past due	$	1,534	1.2	$	2,082	1.6

OTHER NOTES RECEIVABLE (Tables)

3 Months Ended

Mar. 31, 2022

OTHER NOTES RECEIVABLE

Schedule of other notes receivable, net of allowance for loan losses and deferred financing fees


	As of March 31,		As of December 31,
	2022		2021
Outstanding principal balance	$	38,800	$	42,074
Allowance for loan losses		(52)		(74)
Total	$	38,748	$	42,000

LEASES (Tables)

3 Months Ended

Mar. 31, 2022

LEASES

Schedule of future minimum lease payments under operating lease liabilities


2022	$	522
2023		709
2024		644
2025		608
2026		546
Thereafter		429
Total lease payments	$	3,458
Less amount representing interest		(100)
Total lease liability	$	3,358
Less current lease liability		(652)
Total non-current lease liability	$	2,706

INVENTORIES (Tables)

3 Months Ended

Mar. 31, 2022

INVENTORIES

Schedule of inventory


	As of March 31,		As of December 31,
	2022		2021
Raw materials	$	19,199	$	15,431
Work in progress		799		714
Finished goods (1)		31,825		28,195
Allowance for obsolescence		(302)		(432)
Total	$	51,521	$	43,908

(1)

Finished goods includes $3,738 and $2,678 as of March 31, 2022 and December 31, 2021, respectively, held for more than twelve months and classified as long-term.

PROPERTY, PLANT AND EQUIPMENT (Tables)

3 Months Ended

Mar. 31, 2022

PROPERTY, PLANT AND EQUIPMENT

Schedule of property, plant and equipment


	As of March 31,		As of December 31,
	2022		2021
Land	$	14,949	$	14,949
Buildings and leasehold improvements		13,863		13,722
Vehicles		1,702		1,682
Machinery and equipment		5,841		5,058
Furniture and fixtures		300		298
Total		36,655		35,709
Less accumulated depreciation		(8,639)		(8,193)
Total property, plant and equipment	$	28,016	$	27,516

OTHER ASSETS (Tables)

3 Months Ended

Mar. 31, 2022

OTHER ASSETS.

Schedule of Other Assets


	As of March 31,		As of December 31,
	2022		2021
Prepaid rent	$	355	$	248
Other		332		332
Repossessed homes		793		517
Total	$	1,480	$	1,097

ACCRUED LIABILITIES (Tables)

3 Months Ended

Mar. 31, 2022

ACCRUED LIABILITIES.

Schedule of accrued liabilities


	As of March 31,		As of December 31,
	2022		2021
Warranty reserve	$	2,047	$	2,876
Litigation reserve		2,707		2,764
Payroll		2,399		1,685
Portfolio taxes and title		2,399		2,467
Property tax		233		546
Dealer rebates		838		1,160
Sales tax		66		310
Federal and state income taxes		7,939		7,445
Other		1,370		1,433
Total accrued liabilities	$	19,998	$	20,686

SHARE BASED COMPENSATION (Tables)

3 Months Ended

Mar. 31, 2022

SHARE BASED COMPENSATION

Schedule of restricted stock units activity

The following is a summary of restricted stock units (the “RSU”) activity (in thousands, except per unit data):


	Number of Units		Weighted Average Grant Date Fair Value Per Unit
Nonvested, January 1, 2022	35	$	14.01
Granted	500	$	11.67
Vested	(158)	$	24.33
Nonvested, March 31, 2022	377	$	6.57

Schedule of stock option activity

The following is a summary of option activity (in thousands, except per unit data):


	Number of Units	Weighted Average Exercise Price Per Unit		Weighted Average Grant Date Fair Value Per Unit		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value
Outstanding, January 1, 2022, nonvested	83	$	16.83	$	12.27	9.36
Granted	—	$	—	$	—	—
Exercised	—	$	—	$	—	—
Forfeited	(28)		14.44		8.67	—
Outstanding, March 31, 2022, nonvested	55	$	18.02	$	14.07	9.49	$	191
Exercisable, March 31, 2022	—	$	—	$	—	—	$	—

EARNINGS PER SHARE (Tables)

3 Months Ended

Mar. 31, 2022

EARNINGS PER SHARE

Summary of reconciliation of the numerators and denominators used in the computations of both basic and diluted EPS


	Three months ended
	March 31,
	2022		2021
Numerator:
Net income (in 000's)	$	16,092	$	10,701
Denominator:
Basic weighted-average common shares outstanding		24,351,223		24,199,107
Effect of dilutive securities:
Restricted stock grants		267,515		5,126
Stock options		42,688		6,949
Diluted weighted-average common shares outstanding		24,661,426		24,211,182
Earnings per share attributable to Legacy Housing Corporation
Basic	$	0.66	$	0.44
Diluted	$	0.65	$	0.44

NATURE OF OPERATIONS - IPO and Corporate Conversion (Details) $ / shares in Units, د.ت in Thousands, $ in Thousands			1 Months Ended		12 Months Ended
	Apr. 17, 2019 $ / shares shares	Jan. 01, 2018 shares	Jan. 31, 2019 USD ($) $ / shares shares	Dec. 31, 2018 USD ($) $ / shares shares	Dec. 31, 2020 TND (د.ت) $ / shares shares
Nature of operations
Shares issued upon incorporation (in shares)		20,000,000
Shares repurchased	300,000				145,065
Share repurchase price (in dollars per share) \| $ / shares	$ 10.20				$ 9.77
Value of shares authorized for repurchase \| د.ت					$ 10,000
IPO
Nature of operations
Shares issued from sale of common stock			600,000	4,000,000
Share price (in dollars per share) \| $ / shares			$ 12.00	$ 12.00
Offering costs \| $			$ 505	$ 4,504
Proceeds from IPO net of underwriting discounts and offering expenses \| $			$ 6,695	$ 43,492

NATURE OF OPERATIONS - Condensed Consolidated Statements Of Operations (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Operating expenses:
Cost of product sales	$ 33,727	$ 22,001
Income from operations	18,267	12,683
Income before income tax expense	19,650	12,909
Income tax expense	(3,558)	(2,208)
Net income	$ 16,092	$ 10,701
Net income per share:
Basic	$ 0.66	$ 0.44
Diluted	$ 0.65	$ 0.44
As Originally Reported
Operating expenses:
Cost of product sales		$ 24,024
Income from operations		10,660
Income before income tax expense		10,886
Income tax expense		(1,862)
Net income		$ 9,024
Net income per share:
Basic		$ 0.37
Diluted		$ 0.37
Adjustments
Operating expenses:
Cost of product sales		$ (2,023)
Income from operations		2,023
Income before income tax expense		2,023
Income tax expense		(346)
Net income		$ 1,677
Net income per share:
Basic		$ 0.07
Diluted		$ 0.07

NATURE OF OPERATIONS - Condensed Consolidated Cash Flows (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Operating activities:
Net income	$ 16,092	$ 10,701
Inventories	(7,484)	(3,502)
Prepaid expenses and other current assets	389	120
Other assets	(4,058)	(337)
Accounts payable		(2,798)
Accrued liabilities		(837)
Net cash provided by (used in) operating activities	(1,057)	(1,471)
Investing activities:
Purchases of property, plant and equipment	(863)	(1,717)
Net cash used in investing activities	2,754	(6,127)
Financing activities:
Payments on lines of credit	(23,248)	(13,429)
Net cash provided by (used in) financing activities	$ (211)	9,238
As Originally Reported
Operating activities:
Net income		9,024
Inventories		(3,502)
Prepaid expenses and other current assets		(433)
Other assets		(5)
Accounts payable		(775)
Accrued liabilities		(1,183)
Net cash provided by (used in) operating activities		(1,692)
Investing activities:
Purchases of property, plant and equipment		(1,717)
Net cash used in investing activities		(6,127)
Financing activities:
Payments on lines of credit		(13,208)
Net cash provided by (used in) financing activities		9,459
Adjustments
Operating activities:
Net income		1,677
Prepaid expenses and other current assets		553
Other assets		(332)
Accounts payable		(2,023)
Accrued liabilities		346
Net cash provided by (used in) operating activities		221
Financing activities:
Payments on lines of credit		(221)
Net cash provided by (used in) financing activities		$ (221)

NATURE OF OPERATIONS - Revenue Recognition (Details) د.ت in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($)	Mar. 31, 2022 TND (د.ت)	Mar. 31, 2021 USD ($)	Mar. 31, 2021 TND (د.ت)
Disaggregation of Revenue
Incremental costs of obtaining a contract	true	true
Product sales	$ 51,787		$ 32,274
Dealer commission, reimbursed dealer expenses and other similar costs \| د.ت		د.ت 2,999		د.ت 2,182
Revenue from contract with customer product and service benchmark \| Customer concentration risk \| Independent third party and affiliates
Disaggregation of Revenue
Product sales	$ 3,134		$ 2,664
Concentration risk percentage	6.10%	6.10%	8.30%	8.30%
Minimum
Disaggregation of Revenue
Term of lease agreement	96 months	96 months
Maximum
Disaggregation of Revenue
Term of lease agreement	120 months	120 months

NATURE OF OPERATIONS - Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Disaggregation of Revenue
Product sales	$ 51,787	$ 32,274
Consumer and MHP loans interest:
Interest - consumer installments notes	4,457	4,143
Interest - MHP notes	2,308	2,495
Total consumer and MHP loans interest	6,765	6,638
Other	1,376	1,028
Total net revenue	59,928	39,940
Direct sales
Disaggregation of Revenue
Product sales	10,863	3,422
Commercial sales
Disaggregation of Revenue
Product sales	14,059	12,318
Consignment sales
Disaggregation of Revenue
Product sales	20,040	10,599
Retail store sales
Disaggregation of Revenue
Product sales	4,160	3,321
Other
Disaggregation of Revenue
Product sales	$ 2,665	$ 2,614

NATURE OF OPERATIONS - Accounts Receivable (Details) - TND (د.ت) د.ت in Thousands	3 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Accounts Receivable
Credit period	30 days
Allowance for doubtful accounts	د.ت 375	د.ت 343

NATURE OF OPERATIONS - Leased Property (Details)	3 Months Ended
NATURE OF OPERATIONS - Leased Property (Details)	Mar. 31, 2022
Lessor, Description Of Leases [Line Items]
Notice period for lease termination	30 days
Termination fees as a percentage of remaining lease payments	10.00%
Number of month's rent to be paid	6 months
Notice period for purchase of property	30 days
Extended term of lease	48 months
Notice period for exercise of renewal extension	6 months
Useful life	15 years
Minimum
Lessor, Description Of Leases [Line Items]
Term of lease agreement	96 months
Maximum
Lessor, Description Of Leases [Line Items]
Term of lease agreement	120 months

NATURE OF OPERATIONS - Future minimum lease income (Details) $ in Thousands	Mar. 31, 2022 USD ($)
Operating Leases, Future Minimum Payments Receivable [Abstract]
2022	$ 1,563
2023	2,091
2024	2,091
2025	2,091
2026	2,091
Thereafter	4,685
Total	$ 14,612

NATURE OF OPERATIONS - Recent Accounting Pronouncements (Details) $ in Thousands	Mar. 31, 2022 USD ($)	Mar. 31, 2022 TND (د.ت)	Dec. 31, 2021 USD ($)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Assets	$ 390,667		$ 366,667
Liabilities	61,174		$ 57,273
Cumulative effect, period of adoption, adjustment \| ASU 2016-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Assets \| د.ت		د.ت 3,258,000
Liabilities	$ 3,258

- Definition

Sum of the carrying amounts as of the balance sheet date of all assets that are recognized. Assets are probable future economic benefits obtained or controlled by an entity as a result of past transactions or events.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 210
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-03(11))
-URI http://asc.fasb.org/extlink&oid=120398452&loc=d3e534808-122878

Reference 2: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 852
-SubTopic 10
-Section 55
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=84165509&loc=d3e56426-112766

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(A))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
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- Definition

Sum of the carrying amounts as of the balance sheet date of all liabilities that are recognized. Liabilities are probable future sacrifices of economic benefits arising from present obligations of an entity to transfer assets or provide services to other entities in the future.

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+ Details

CONSUMER LOANS - Narrative (Details) $ in Thousands	3 Months Ended	12 Months Ended
CONSUMER LOANS - Narrative (Details) $ in Thousands	Mar. 31, 2022 USD ($) item	Dec. 31, 2021 USD ($)
Average contractual interest rate	13.50%	13.50%
Escrow liability	$ 9,142	$ 9,350
Number of components comprising the allowance for loan losses \| item	2
Number of years historical loss rate considers for calculation	3 years
Repossessed assets	$ 793	517
Principal outstanding on consumer loans	$ 1,274	$ 1,239
Minimum
Consumer loans receivable term	3 years
Maximum
Consumer loans receivable term	30 years

CONSUMER LOANS - Consumer loans receivable, net (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020
CONSUMER LOANS
Consumer loans receivable	$ 130,539	$ 129,119
Loan discount and deferred financing fees	(2,556)	(2,612)
Allowance for loan losses	(724)	(884)	$ (927)	$ (905)
Consumer loans receivable, net	$ 127,259	$ 125,623

CONSUMER LOANS - Allowance for loan losses (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
CONSUMER LOANS
Allowance for loan losses, beginning of period	$ 884	$ 905
Provision for loan losses	(309)	535
Charge offs (recoveries)	149	(513)
Allowance for loan losses	$ 724	$ 927

CONSUMER LOANS - Impaired and general reserve for allowance for loan losses (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021	Mar. 31, 2021	Dec. 31, 2020
CONSUMER LOANS
Total consumer loans receivable	$ 130,539	$ 129,119
Allowance for loan losses	724	884	$ 927	$ 905
Impaired loans individually evaluated for impairment	1,274	1,239
Specific reserve against impaired loans	452	533
Other loans collectively evaluated for allowance	129,265	127,880
General allowance for loan losses	$ 272	$ 351

CONSUMER LOANS - Aging of consumer loans receivable (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Past due consumer loans:
Total consumer loans receivable	$ 130,539	$ 129,119
Total consumer loans receivable (as a percent)	100.00%	100.00%
Financial Asset, Past Due
Past due consumer loans:
Consumer loans receivable	$ 1,534	$ 2,082
Consumer loans receivable past due (Percent)	1.20%	1.60%
31 - 60 days past due
Past due consumer loans:
Consumer loans receivable	$ 243	$ 594
Consumer loans receivable past due (Percent)	0.20%	0.50%
61 - 90 days past due
Past due consumer loans:
Consumer loans receivable	$ 111	$ 407
Consumer loans receivable past due (Percent)	0.10%	0.30%
91 - 120 days past due
Past due consumer loans:
Consumer loans receivable	$ 109	$ 114
Consumer loans receivable past due (Percent)	0.10%	0.10%
Greater than 120 days past due
Past due consumer loans:
Consumer loans receivable	$ 1,071	$ 967
Consumer loans receivable past due (Percent)	0.80%	0.70%

NOTES RECEIVABLE FROM MOBILE HOME PARKS (Details) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2022 TND (د.ت)	Dec. 31, 2021 TND (د.ت)	Mar. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)
Notes Receivable
Impaired loans individually evaluated for impairment			$ 1,274	$ 1,239
Repossessed homes			793	517
Notes Receivable from Mobile Home Parks
Notes Receivable
Unamortized finance fees			591	445
Note receivable with fixed rate of interest			$ 98,000
Charge offs \| د.ت	د.ت 0	د.ت 0
Interest rate spread (as a percent)			4.00%
Interest rate on the MHP Notes	7.70%	7.60%
Allowance for loan losses			$ 0	0
Impaired loans individually evaluated for impairment			0	0
Repossessed homes			$ 0	$ 0
Notes Receivable from Mobile Home Parks \| Credit concentration risk \| Independent third party and affiliates \| Independent Third Party One
Notes Receivable
Concentration risk percentage	29.10%	30.10%
Notes Receivable from Mobile Home Parks \| Credit concentration risk \| Independent third party and affiliates \| Independent Third Party Two
Notes Receivable
Concentration risk percentage	12.90%	10.40%
Minimum \| Notes Receivable from Mobile Home Parks
Notes Receivable
Fixed rate of interest (as a percent)	6.90%
Term Of Notes Receivables	1 year
Interest rate spread (as a percent)			8.00%
Maximum \| Notes Receivable from Mobile Home Parks
Notes Receivable
Fixed rate of interest (as a percent)	8.90%
Term Of Notes Receivables	18 years

OTHER NOTES RECEIVABLE (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Notes Receivable
Impaired loans individually evaluated for impairment	$ 1,274	$ 1,239
Financial Asset, Past Due
Notes Receivable
Outstanding principal balance	1,534	2,082
Other Note Receivable
Notes Receivable
Outstanding principal balance	38,800	42,074
Allowance for loan losses	(52)	(74)
Total	38,748	42,000
Impaired loans individually evaluated for impairment	$ 0	0
Other Note Receivable \| Minimum
Notes Receivable
Interest rate on the other notes	5.00%
Other Note Receivable \| Maximum
Notes Receivable
Interest rate on the other notes	12.00%
Other Note Receivable \| Financial Asset, Past Due
Notes Receivable
Outstanding principal balance	$ 0	$ 0

LEASES (Details)	3 Months Ended
LEASES (Details)	Mar. 31, 2022 USD ($) lease
LEASES
Number of operating leases	13
Number of operating leases subleased	3
Operating lease, term of contract (in years)	10 years
Options to renew	true
Variable lease cost \| $	$ 0
Operating weighted average lease term	5 years 2 months 12 days
Operating weighted average discount rate (as a percent)	2.12%
Minimum
LEASES
Operating lease, term of contract (in years)	5 years
Maximum
LEASES
Operating lease, term of contract (in years)	10 years
Heritage Housing and Tiny Homes retail locations
LEASES
Number of operating leases	8
Corporate and administrative offices in Bedford, TX and Norcross, GA
LEASES
Number of operating leases subleased	2

LEASES - Future minimum lease payments (Details) $ in Thousands	Mar. 31, 2022 USD ($)
LEASES
2022	$ 522
2023	709
2024	644
2025	608
2026	546
Thereafter	429
Total lease payments	3,458
Less amount representing interest	(100)
Total lease liability	3,358
Less current lease liability	(652)
Total non-current lease liability	$ 2,706

INVENTORIES (Details) د.ت in Thousands, $ in Thousands	Mar. 31, 2022 USD ($)	Mar. 31, 2022 TND (د.ت)	Dec. 31, 2021 USD ($)	Dec. 31, 2021 TND (د.ت)
INVENTORIES
Raw materials	$ 19,199		$ 15,431
Work in progress	799		714
Finished goods (1)	31,825		28,195
Allowance for obsolescence	(302)		(432)
Total	51,521		43,908
Inventories, net	$ 3,738	د.ت 3,738	$ 2,678	د.ت 2,678

PROPERTY, PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
PROPERTY, PLANT AND EQUIPMENT
Total	$ 36,655		$ 35,709
Less accumulated depreciation	(8,639)		(8,193)
Total property, plant and equipment	28,016		27,516
Depreciation expense	260	$ 264
Cost of product sales
PROPERTY, PLANT AND EQUIPMENT
Depreciation expense	121	$ 104
Land
PROPERTY, PLANT AND EQUIPMENT
Total	14,949		14,949
Buildings and leasehold improvements
PROPERTY, PLANT AND EQUIPMENT
Total	13,863		13,722
Vehicles
PROPERTY, PLANT AND EQUIPMENT
Total	1,702		1,682
Machinery and equipment
PROPERTY, PLANT AND EQUIPMENT
Total	5,841		5,058
Furniture and fixtures
PROPERTY, PLANT AND EQUIPMENT
Total	$ 300		$ 298

OTHER ASSETS (Details) - USD ($) $ in Thousands	3 Months Ended
OTHER ASSETS (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
OTHER ASSETS.
Prepaid rent	$ 355		$ 248
Other	332		332
Repossessed homes	793		517
Total	1,480		$ 1,097
Depreciation expense on leased property	$ 170	$ 98

ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
ACCRUED LIABILITIES.
Warranty reserve	$ 2,047	$ 2,876
Litigation reserve	2,707	2,764
Payroll	2,399	1,685
Portfolio taxes and title	2,399	2,467
Property tax	233	546
Dealer rebates	838	1,160
Sales tax	66	310
Federal and state income taxes	7,939	7,445
Accrued expenses & other accrued liabilities	1,370	1,433
Total accrued liabilities	$ 19,998	$ 20,686

DEBT - Lines of Credit (Details) - Revolver 1 - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Mar. 30, 2020	Dec. 31, 2021	Dec. 31, 2019
Lines of Credit
Maximum borrowing capacity			$ 70,000		$ 45,000
Effective interest rate	2.23%			2.10%
Amount of available credit	$ 64,923			$ 61,841
Interest expense	56	$ 226
Outstanding balance	5,224			8,159
Tangible net worth	$ 120,000
Debt to EBITDA ratio	4
Deferred debt issuance costs				$ 295
London Interbank Offered Rate (LIBOR)
Lines of Credit
Spread rate	2.00%		2.40%

DEBT - PPP Loans (Details) - PILOT Agreement	Dec. 31, 2016 TND (د.ت)
Notes Payable
Maximum borrowing capacity	د.ت 10,000,000
Interest rate	6.00%

SHARE BASED COMPENSATION - Plan (Details) $ / shares in Units, د.ت in Thousands, $ in Thousands							3 Months Ended
	Jan. 06, 2022 USD ($) $ / shares shares	Nov. 30, 2021 USD ($) shares	Sep. 23, 2021	Dec. 02, 2020 USD ($) shares	Aug. 10, 2020	Feb. 07, 2019 TND (د.ت) shares	Mar. 31, 2022 shares	Jun. 30, 2020 shares
SHARE-BASED COMPENSATION
Number of shares may be issued to employees, directors, consultants and nonemployee service providers in the form of stock options, stock and stock appreciation rights							10,000,000.0
Number of shares available for grant							9,200,000
$36 Equity Award
SHARE-BASED COMPENSATION
Granted (in dollars per share) \| $ / shares	$ 36
$48 Equity Award
SHARE-BASED COMPENSATION
Granted (in dollars per share) \| $ / shares	$ 48
Stock options
SHARE-BASED COMPENSATION
Contractual life							10 years
Stock options \| Senior management
SHARE-BASED COMPENSATION
Contractual life			10 years		10 years
Vesting percentage			10.00%		20.00%
Restricted shares \| Senior management
SHARE-BASED COMPENSATION
Restricted shares granted (in shares)						120,000
Grant date fair value \| د.ت						د.ت 1,636
Vesting percentage						14.30%
Restricted shares forfeited (in shares)								42,857
Restricted shares \| Independent directors
SHARE-BASED COMPENSATION
Restricted shares granted (in shares)		1,202		2,022
Grant date fair value \| $		$ 30		$ 30
Restricted shares \| Executive Chairman
SHARE-BASED COMPENSATION
Restricted shares granted (in shares)	150,000
Grant date fair value \| $	$ 3,741
Contingent equity awards \| $36 Equity Award
SHARE-BASED COMPENSATION
Restricted shares granted (in shares)	175,000
Threshold market days remained granted	15 days
Granted (in dollars per share) \| $ / shares	$ 36
Grant date fair value \| $	$ 1,412
Contingent equity awards \| $36 Equity Award \| Vested at granted
SHARE-BASED COMPENSATION
Vesting percentage	50.00%
Contingent equity awards \| $36 Equity Award \| Vested on June 16, 2024
SHARE-BASED COMPENSATION
Vesting percentage	50.00%
Contingent equity awards \| $48 Equity Award
SHARE-BASED COMPENSATION
Restricted shares granted (in shares)	175,000
Threshold market days remained granted	15 days
Granted (in dollars per share) \| $ / shares	$ 48
Grant date fair value \| $	$ 683
Contingent equity awards \| $48 Equity Award \| Vested at granted
SHARE-BASED COMPENSATION
Vesting percentage	50.00%
Contingent equity awards \| $48 Equity Award \| Vested on June 16, 2024
SHARE-BASED COMPENSATION
Vesting percentage	50.00%
Contingent equity awards \| Executive Chairman
SHARE-BASED COMPENSATION
Restricted shares granted (in shares)	350,000

SHARE BASED COMPENSATION - Restricted stock units (Details) - Restricted stock units $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($) $ / shares shares
Number of units
Nonvested at the beginning \| shares	35,000
Granted \| shares	500,000
Vested \| shares	(158,000)
Nonvested at the end \| shares	377,000
Weighted average grant date fair value
Nonvested at the beginning (in dollars per share) \| $ / shares	$ 14.01
Granted (in dollars per share) \| $ / shares	11.67
Vested (in dollars per share) \| $ / shares	24.33
Nonvested at the end (in dollars per share) \| $ / shares	$ 6.57
Unrecognized compensation expense \| $	$ 2,238
Unrecognized compensation expense, recognition period	2 years 3 months 18 days

SHARE BASED COMPENSATION - Stock options (Details) - Stock options - $ / shares			3 Months Ended
	Sep. 23, 2021	Aug. 10, 2020	Mar. 31, 2022
SHARE-BASED COMPENSATION
Stock option forfeited (in shares)			28,000
Fair value assumptions for options granted
Expiration period			10 years
Senior management
SHARE-BASED COMPENSATION
Stock options granted (in shares)	55,490	34,626
Exercise price (in dollar per share)	$ 18.02	$ 14.44
Vesting percentage	10.00%	20.00%
Fair value assumptions for options granted
Risk free interest rate	1.41%	0.24%
Dividend yield	0.00%	0.00%
Expected volatility	75.00%	75.00%
Expiration period	10 years	10 years
Expected life	7 years 9 months 18 days	6 years 6 months
Senior management \| Departure of senior manager
SHARE-BASED COMPENSATION
Stock option forfeited (in shares)			27,701

SHARE BASED COMPENSATION - Summary of Stock options activity (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2022	Dec. 31, 2021	Mar. 31, 2020
2018 Incentive Compensation Plan
Weighted Average Remaining Contractual Life and Aggregate Intrinsic Value
Common stock available for issuance			2,300,000
Stock options
Number of units
Outstanding, nonvested	83,000
Forfeited	(28,000)
Outstanding, nonvested	55,000	83,000
Weighted Average Exercise Price Per Unit
Outstanding at the beginning (in dollars per share)	$ 16.83
Forfeited (in dollars per share)	14.44
Outstanding at the end (in dollars per share)	18.02	$ 16.83
Weighted Average Grant Date Fair Value Per Unit
Outstanding at the beginning (in dollars per share)	12.27
Forfeited (in dollars per share)	8.67
Outstanding at the end (in dollars per share)	$ 14.07	$ 12.27
Weighted Average Remaining Contractual Life and Aggregate Intrinsic Value
Outstanding (in years)	9 years 5 months 26 days	9 years 4 months 9 days
Outstanding at the end (in dollars)	$ 191
Non-vested shares	55,000	83,000
Unrecognized compensation expense	$ 740
Unrecognized compensation expense, recognition period	9 years 5 months 26 days

INCOME TAXES (Details) - USD ($) $ in Thousands	3 Months Ended
INCOME TAXES (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Mar. 31, 2021
INCOME TAXES
Tax expense	$ 3,558	$ 2,208
Effective tax rate (as a percent)	18.10%	17.10%
Federal statutory rate	21.00%	21.00%

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Commitment
Self-insured liability	$ 326	$ 373
Repurchase agreements \| Maximum
Commitment
Repurchase commitment	$ 14,749	$ 4,908

COMMITMENTS AND CONTINGENCIES - Leases (Details) - TND (د.ت) د.ت in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Operating Leased Assets [Line Items]
Operating lease, term of contract (in years)	10 years
Rent expense	د.ت 163	د.ت 151
Sublease rental income	د.ت 82	د.ت 91
Minimum
Operating Leased Assets [Line Items]
Operating lease, term of contract (in years)	5 years
Sublease, term of contract (in years)	3 years
Maximum
Operating Leased Assets [Line Items]
Operating lease, term of contract (in years)	10 years
Sublease, term of contract (in years)	11 years

COMMITMENTS AND CONTINGENCIES - Legal Matters (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
COMMITMENTS AND CONTINGENCIES
Legal reserves	$ 2,707	$ 2,764

DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Details) $ in Thousands	Jun. 12, 2017 USD ($)
Interest rate swap agreement \| Line of credit
Derivative instruments
Interest rate swap agreement	$ 8,000

DERIVATIVE FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS - Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Fair Value \| Level 3 \| Consumer Loan
Receivables, Fair Value Disclosure [Abstract]
Loans	$ 127,600	$ 125,600
Fair Value \| Level 3 \| Notes Receivable from Mobile Home Parks
Receivables, Fair Value Disclosure [Abstract]
Notes receivable	92,000	83,000
Fair Value \| Level 3 \| Other Note Receivable
Receivables, Fair Value Disclosure [Abstract]
Notes receivable	33,300	38,500
Book Value \| Consumer Loan
Receivables, Fair Value Disclosure [Abstract]
Loans	127,259	125,623
Book Value \| Notes Receivable from Mobile Home Parks
Receivables, Fair Value Disclosure [Abstract]
Notes receivable	97,782	83,773
Book Value \| Other Note Receivable
Receivables, Fair Value Disclosure [Abstract]
Notes receivable	$ 38,748	$ 38,886

EARNINGS PER SHARE- Tabular (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Numerator:
Net income (in 000's)	$ 16,092	$ 10,701
Denominator:
Basic weighted-average common shares outstanding	24,351,223	24,199,107
Effect of dilutive securities:
Diluted weighted-average common shares outstanding	24,661,426	24,211,182
Earnings per share attributable to Legacy Housing Corporation
Basic	$ 0.66	$ 0.44
Diluted	$ 0.65	$ 0.44
Restricted stock units
Effect of dilutive securities:
Dilutive securities	267,515	5,126
Stock options
Effect of dilutive securities:
Dilutive securities	42,688	6,949

RELATED PARTY TRANSACTIONS (Details) $ in Thousands	3 Months Ended
RELATED PARTY TRANSACTIONS (Details) $ in Thousands	Mar. 31, 2022 USD ($)	Mar. 31, 2021 USD ($)	Mar. 31, 2022 TND (د.ت)	Dec. 31, 2021 USD ($)	Dec. 31, 2021 TND (د.ت)
Bell Mobile Homes
RELATED PARTY TRANSACTIONS
Accounts receivable related parties \| د.ت			د.ت 139,000		د.ت 1,000
Accounts payable related parties	$ 69				د.ت 49,000
Home sales to related parties	632	$ 699
Shipley Bros.
RELATED PARTY TRANSACTIONS
Accounts receivable related parties	424			$ 0
Accounts payable related parties	0			$ 0
Home sales to related parties	$ 693	$ 914

- Definition

Amount of revenue, fees and commissions earned from transactions between (a) a parent company and its subsidiaries; (b) subsidiaries of a common parent; (c) an entity and trusts for the benefit of employees, for example, but not limited to, pension and profit-sharing trusts that are managed by or under the trusteeship of the entity's management; (d) an entity and its principal, owners, management, or members of their immediate families; and (e) affiliates.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iv))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 946
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.6-07.1(c))
-URI http://asc.fasb.org/extlink&oid=120401555&loc=SL114874292-224272

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iii)(B))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(C))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(5))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(5))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iv))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03.1(e))
-URI http://asc.fasb.org/extlink&oid=123367319&loc=SL114868664-224227

+ Details

SUBSEQUENT EVENTS (Details) - USD ($) $ / shares in Units, $ in Thousands	Aug. 24, 2022	Jun. 07, 2022	Jun. 28, 2022	Mar. 31, 2022	Dec. 31, 2021	Mar. 30, 2020	Dec. 31, 2019
Revolver 1
SUBSEQUENT EVENTS
Maximum borrowing capacity						$ 70,000	$ 45,000
Amount of available credit				$ 64,923	$ 61,841
Subsequent event
SUBSEQUENT EVENTS
Certificate of deposit			$ 8,500
Subsequent event \| Revolver 1
SUBSEQUENT EVENTS
Credit facility suspended amount	$ 50,000
Maximum borrowing capacity	70,000
Amount of available credit	$ 20,000
Subsequent event \| Mr. Duncan Bates, President and Chief Executive Officer \| Employment Agreement \| Restricted shares
SUBSEQUENT EVENTS
Base salary		$ 300
Granted		14,700
Subsequent event \| Mr. Duncan Bates, President and Chief Executive Officer \| Employment Agreement \| Restricted shares \| Vested on June 7, 2023
SUBSEQUENT EVENTS
Vesting percentage		50.00%
Subsequent event \| Mr. Duncan Bates, President and Chief Executive Officer \| Employment Agreement \| Restricted shares \| Vested on June 7, 2024
SUBSEQUENT EVENTS
Vesting percentage		50.00%
Subsequent event \| Mr. Duncan Bates, President and Chief Executive Officer \| Employment Agreement \| Stock options
SUBSEQUENT EVENTS
Granted		62,460
Exercise price (in dollar per share)		$ 16.01
Vesting percentage		10.00%
Subsequent event \| Mr. Duncan Bates, President and Chief Executive Officer \| Employment Agreement \| Stock options \| Stock Price Reaches Closing Price of $36 Per Share
SUBSEQUENT EVENTS
Option to purchase		300,000
Exercise price		$ 36
Subsequent event \| Mr. Duncan Bates, President and Chief Executive Officer \| Employment Agreement \| Stock options \| Stock Price Reaches Closing Price of $48 Per Share
SUBSEQUENT EVENTS
Option to purchase		600,000
Exercise price		$ 48
Subsequent event \| Ronald Arrington, the Chief Financial Officer \| Employment Agreement \| Stock options
SUBSEQUENT EVENTS
Granted		62,460
Exercise price (in dollar per share)		$ 16.01
Vesting percentage		10.00%