LENDWAY, INC.

LENDWAY, INC. Material Event: An Investor's Guide

LENDWAY, INC. has announced significant developments. This guide provides a clear, jargon-free overview of what's happening and why it matters for your investment.

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1. What's the Big News?

LENDWAY is undergoing a significant transformation. The company plans to raise up to $15.5 million from current shareholders through a "rights offering." This capital raise primarily aims to pay off a substantial loan early and at a significant discount. As part of this strategic shift, LENDWAY also plans to change its name to "Bloomia Holdings, Inc." and its Nasdaq stock ticker symbol to "TULP." This new identity signals a dedicated focus on Bloomia B.V., a leading floral and plant company LENDWAY acquired.

2. When Did This Happen?

LENDWAY finalized the agreement to amend the loan terms on January 19, 2026. The company publicly announced the rights offering and planned name change in a press release on January 23, 2026.

3. Why Is This Happening? (The Backstory & Strategy)

Here's the strategic rationale behind these significant changes:

• The Original Loan: In February 2024, LENDWAY, through its subsidiaries, secured a loan of approximately $12.75 million to finance the acquisition of Bloomia B.V. from its original sellers. This loan represented a significant liability on LENDWAY's balance sheet.
• The Discounted Payoff Opportunity: LENDWAY successfully negotiated a deal to repay this loan for a much lower amount – $7.33 million – provided the company does so by April 15, 2026. This saves over $5.4 million in principal alone, plus substantial future interest payments. In return for this discount, LENDWAY's subsidiaries will release the original Bloomia sellers from certain indemnification obligations related to the acquisition, providing both parties with greater certainty.
• The Rights Offering: To secure the necessary funds for this discounted loan payoff and to bolster working capital for general corporate purposes, LENDWAY is inviting existing shareholders to purchase new shares. This method allows current investors to maintain their proportional ownership in the company. While specific terms (like the exact subscription price per share) are forthcoming, the offering will raise the required capital.
• The Name Change & Strategic Focus: The planned change to "Bloomia Holdings, Inc." and the new ticker "TULP" (Dutch for tulip, reflecting Bloomia's core business) is more than cosmetic; it signifies a clear strategic pivot. LENDWAY, previously with a broader business scope, now signals a dedicated focus on the growth and potential of the Bloomia floral and plant business. This aims to create a clearer brand identity and streamline operational strategy.

4. Why Does This Matter? (The "So What?")

This pivotal moment for LENDWAY carries several key implications:

• Significant Debt Reduction & Financial Strength: Paying off a $12.75 million loan for $7.33 million significantly de-leverages the company. This reduction of over $5.4 million in principal, coupled with the elimination of future interest expenses, will dramatically improve LENDWAY's balance sheet, cash flow, and overall financial health.
• Clear Strategic Direction: The rebrand to "Bloomia Holdings, Inc." solidifies the company's commitment to the Bloomia business. This focus could unlock new opportunities within the floral and plant market, potentially leading to more efficient resource allocation and clearer growth initiatives.
• Capital Infusion for Growth: The rights offering will fund the loan repayment and provide essential working capital for day-to-day operations and future investments in the Bloomia business, supporting its growth.
• Risk Awareness: While beneficial, investors should recognize potential risks. The rights offering could significantly dilute existing shareholders who do not participate. Execution risks also exist in fully integrating and growing the Bloomia business as the company's primary focus.

5. Who Is Affected? (The Ripple Effect)

These major corporate actions will broadly impact several groups:

• Customers: Bloomia B.V. customers may see a renewed focus on product development and service, potentially leading to new or improved offerings as the company dedicates more resources.
• Employees: Employees, especially within Bloomia operations, could see new opportunities from this strategic shift, a clearer company vision, and potentially increased investment in their division.
• Investors/Shareholders: Investors and shareholders will feel the most direct impact:
  • Positive Financial Impact: The significant debt reduction positively impacts the company's long-term financial stability and intrinsic value.
  • Potential Dilution: The rights offering will issue new shares. Existing shareholders who do not participate will see their percentage of ownership decrease. The final offering price and number of shares issued will determine the exact extent of dilution.
  • Related Party Involvement: Certain existing shareholders and affiliates, who are also LENDWAY creditors, expect to subscribe approximately $6.6 million of the rights offering. They intend to convert some or all of their outstanding debt into new equity. This significant commitment helps ensure the offering's success and further reduces company debt, though these related parties will also increase their ownership stake.
• Competitors: Competitors in the floral and plant industry will likely view a financially stronger, more focused "Bloomia Holdings" as a more formidable rival.

6. What Happens Next? (Looking Ahead)

Here are the immediate next steps:

• Rights Offering Details: LENDWAY expects to release more specific information about the rights offering soon, including the exact subscription price per share, the ratio of rights to shares, the record date for shareholders, and the deadline to participate. Investors will find this information crucial.
• Loan Repayment: After successfully completing the rights offering, LENDWAY plans to use the proceeds to repay the discounted loan well before the April 15, 2026 deadline.
• Name and Ticker Change: Once the rights offering is complete and subject to any necessary shareholder approvals, LENDWAY will officially change its name to "Bloomia Holdings, Inc." and begin trading under the new ticker symbol "TULP" on Nasdaq.
• Future Strategy Communication: Expect the company to provide more details on its strategic plans for Bloomia, outlining how this new financial stability and focused identity will drive future growth and profitability.

7. What Should Investors Know? (Your Takeaways)

For investors tracking LENDWAY's stock, here are the key takeaways:

• Significant Financial Improvement: Paying off a large loan at such a substantial discount is a major positive development for the company's financial health and long-term prospects. This significantly strengthens the balance sheet.
• Crucial Rights Offering Decision: If you own LENDWAY stock, carefully evaluate participation in the rights offering. Participation allows you to maintain your ownership percentage; non-participation will dilute your stake.
• Potential for Volatility: News of debt restructuring, capital raises, and a rebrand can often increase short-term stock price volatility. Closely monitor market reactions.
• New Strategic Focus: The name and ticker change signal a new chapter, with the company heavily focused on the Bloomia acquisition. Understand this new direction and its implications for the company's future performance and market position within the floral and plant industry.
• Do Your Due Diligence: Always review official SEC filings (the full 8-K, and subsequent S-1 or prospectus for the rights offering) for complete, detailed information. Understand the rights offering terms and how this strategic shift aligns with your personal investment goals and risk tolerance.