Comstock Holding Companies, Inc. (NASDAQ:CHCI) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.

On October13, 2017, Comstock Investors X, L.C. (“Investors X”), a subsidiary of Comstock Holding Companies, Inc. (the “Company”), amended its Operating Agreement to increase the amount of the aggregate capital raise to up to Nineteen Million Five Hundred Thousand Dollars ($19,500,000) that may be drawn as needed at the request of the Company (“Private Placement”). The initial accredited investor in Investors X, an entity wholly owned by Christopher Clemente, the Chief Executive Officer of the Company (“Purchaser”), contributed the additional capital. The investment has been made to a second amendment to the operating agreement of Investors X entered into by the Company and the Purchaser (the “Amendment to Operating Agreement”).

The proceeds from the Private Placement provide capital primarily for the planned construction of the Company’s Totten Mews project, consisting of forty single family attached homes in Washington, D.C., its Towns at 1333 project, consisting of eighteen single family attached homes in the City of Alexandria, Virginia, its Richmond Station project, consisting of 158 townhomes in Manassas, Virginia, and the Marwood East project, consisting of 40 single family homes in Loudoun County, Virginia (individually or collectively, a “Project”). Proceeds of the Private Placement may be utilized (i)to provide capital needed to complete the Projects, (ii)to pay off investors in the private capital raise of Comstock Investors IX, L.C., and (iii)for general corporate purposes of the Company.

As part of the Private Placement, the Company issued a warrant (“Warrant”) to the Purchaser to purchase shares of the Company’s ClassA Common Stock (“Class A Common Stock”). The Warrant represents the right to purchase an aggregate amount of up to 50,000 shares of ClassA Common Stock. The Warrant has an initial exercise price (subject to certain restrictions as indicated on the Warrant) equal to the average of the closing price of the ClassA Common Stock over the 20 trading days preceding the issuance of the Warrant. The exercise price and number of shares of ClassA Common Stock issuable upon the exercise of the Warrant will be subject to adjustment as a result of certain events as described in the Warrant. The Warrant contains a cashless exercise provision. In the event the Purchaser exercises the Warrant on a cashless basis, the Company will not receive any proceeds from such exercise. The Warrant may be exercised at any time in whole or in part prior to October12, 2027.

The foregoing description of the material terms of the Amendment to the Operating Agreement and the Warrant is qualified in its entirety by reference to the full text of the form of the Amendment to the Operating Agreement and the form of Warrant, which will be filed as exhibits to the Company’s Form 10-Q for the quarter ending September30, 2017.

The information set forth in response to Item 1.01 of this Form 8-K is incorporated by reference in response to this Item 1.01.

The information set forth in response to Item 1.01 of this Form 8-K is incorporated by reference in response to this Item 1.01. The Interests and the Warrant were offered and sold to the Purchaser in reliance upon exemptions from registration to Section4(2) under the Securities Act, and Rule 506(c) promulgated thereunder, and the certificates representing the securities shall bear legends to that effect. The Purchaser represented itself as an accredited investor (as defined by Rule 501 under the Securities Act), and Investors X and the Company took reasonable steps to verify such status. The Interests, the Warrant and the shares of ClassA Common Stock issuable upon the exercise of the Warrant have not been registered under the Securities Act, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.