8-K: Lendway to Cut Debt, Rebrand as Bloomia Holdings

Lendway, Inc. announced a strategic rights offering to significantly reduce debt and plans to rebrand as Bloomia Holdings, Inc.

Summary

• Lendway, Inc. (the Company) entered into a First Amendment to Bridge Loan Agreement on January 19, 2026, allowing its subsidiaries (the Borrowers) to prepay the original $12,750,275 Bridge Loan at a discounted aggregate amount of $7,330,000 at any time prior to April 15, 2026.
• The original Bridge Loan bore interest at 8% per annum for the first year, increasing by 2 percentage points annually thereafter, and was set to mature on March 24, 2029.
• As of December 31, 2025, no principal had been paid on the Bridge Loan, $85,000 in cash interest had been paid, and $2,843,000 of interest expense was accrued.
• The discounted prepayment is conditional upon the Borrowers releasing the Lenders from any liability related to warranties and indemnities from the original Share Purchase Agreement.
• The Company announced a rights offering to existing common stockholders, expecting to receive gross proceeds of up to $15,500,000 before expenses.
• As of December 31, 2025, the Company had $6,600,000 in notes due to related party shareholders, who intend to exercise their subscription rights and over-subscription privilege, potentially through cancellation of indebtedness.
• If related party note holders participate by canceling the full $6,600,000 indebtedness, the maximum gross cash proceeds from the rights offering would be $8,900,000.
• The primary use of cash proceeds from the rights offering will be to repay the Bridge Loan, with any remaining net cash proceeds allocated to working capital and general corporate purposes.
• The Company intends to change its corporate name to Bloomia Holdings, Inc. and its NASDAQ trading symbol to TULP upon completion of the name change process.

Sentiment

Score: 8

Explanation: The filing details a highly favorable debt restructuring, allowing the company to retire a substantial bridge loan at a significant discount and reduce overall debt by up to 70%. This, combined with a planned capital raise supported by related parties and a strategic rebranding, positions the company for improved financial health and future growth.

Positives

• Secured the right to prepay the Bridge Loan at a significant discount, reducing the principal obligation from $12,750,275 to $7,330,000, representing a saving of over $5.4 million.
• Expected debt reduction of up to 40% immediately following the rights offering, and potentially up to 70% by early summer, significantly strengthening the balance sheet.
• Anticipated $8,000,000 gain from the seller note settlement and over $1,600,000 in annual interest savings from the Bridge Loan repayment.
• Projected over $600,000 in annual interest savings from the settlement of related party notes.
• Management and the Company's largest stockholders plan to enthusiastically participate in the rights offering, including over-subscription opportunities, signaling strong internal confidence.
• Strategic investments of $1,370,000 are planned to reduce operating costs and improve quality.

Negatives

• The Company's reliance on a capital raise (rights offering) to address significant existing debt obligations indicates a need for external funding to improve financial health.
• The necessity of a substantial discount on the Bridge Loan repayment suggests previous financial challenges or an initial overvaluation of the acquired assets.
• There is no guarantee of the amount of gross proceeds that the Company will receive from the rights offering.
• The discounted prepayment requires the Borrowers to release the Lenders from any liability related to warranties and indemnities from the original Share Purchase Agreement, potentially waiving future claims.

Risks

• Ability to complete the rights offering and the level of participation in, and correspondence proceeds received from, the rights offering.
• Ability to compete in the market.
• Concentration of revenue among a small number of customers.
• Dependency on Dutch tulip bulbs.
• Changes in interest rates.
• Ability to comply with the requirements of the credit agreement and operate within its restrictions.
• Economic and market conditions that may restrict or delay appropriate or desirable opportunities.
• Ability to develop and maintain necessary processes and controls relating to the businesses.
• Reliance on one or a small number of employees.
• Ability to generate enough cash or secure enough capital to execute business plans.
• Ability to obtain seasonal workers.
• Other economic, international, business, market, financial, competitive and/or regulatory factors affecting the Company's businesses generally.
• Exchange rate fluctuations and tariffs.
• The availability of additional capital on desirable terms, if at all.

Future Outlook

The Company expects to significantly strengthen its balance sheet, boost future earnings potential, and be better positioned to act on future market conditions. It aims to reduce overall debt by up to 40% immediately and potentially up to 70% by early summer. Strategic investments are planned to reduce operating costs and improve quality. The corporate name change to Bloomia Holdings, Inc. and new ticker symbol TULP reflect a strategic focus on its core operating business.

Management Comments

• Mark Jundt, Chairman and Co-CEO, stated: "We are very excited about the future of the Company and encourage our stockholders to recognize the unique opportunity in front of us. We have a very limited time opportunity to retire over $15 million in debt for $7.3 million, plus a further potential to retire another $6.6 million in other debt. These actions will have the strong potential to significantly strengthen the Company’s balance sheet, boost future earnings potential, and allow the Company to act on future market conditions that it is uniquely positioned to take advantage of. We believe this is unquestionably a major win for stockholders."
• Dan Philp, Co-CEO, added: "The potential to reduce our debt by as much as $21 million as a result of a successful rights offering is incredible. In our collective opinion, this strategic rights offering will right-size the Company’s balance sheet to allow management to focus on continued growth and delivering increasing stockholder value. The immediate impact of the use of proceeds from the rights offering is such a glowing positive for the Company’s future that the Company’s largest stockholders, plus the corporate Executive team, will plan to enthusiastically participate in the offering, including in portions of oversubscription opportunities that may be available. And the reason we are doing a rights offering specifically, is because it is designed to give every single stockholder an opportunity to participate as well."

Industry Context

Lendway, Inc. operates as a specialty agriculture company, primarily through its majority ownership of Bloomia, a significant producer of fresh-cut tulips in the United States. The planned corporate name change to Bloomia Holdings, Inc. and the new NASDAQ ticker symbol TULP (Dutch for tulip) signify a strategic alignment of the company's identity with its core operational focus in the floriculture and specialty agriculture sector. This move aims to leverage the established brand and heritage of its operating business, potentially enhancing market recognition and investor perception within its niche industry.

Related Party Transactions

• Related party shareholders are owed $6,600,000 in notes as of December 31, 2025.
• These related party note holders intend to exercise all their subscription rights and over-subscription privilege in the upcoming rights offering.
• They reserve the right to pay for their subscription rights through the cancellation of indebtedness owed by the Company.

Stakeholder Impact

• **Shareholders**: Opportunity to participate in a rights offering to support debt reduction and future growth; potential for dilution if not participating; potential for increased shareholder value due to strengthened balance sheet and improved earnings.
• **Lenders (Botman, Jansen, Strengers)**: Will receive a discounted prepayment of the Bridge Loan ($7.33 million instead of $12.75 million principal plus accrued interest) in exchange for releasing the Borrowers from warranty and indemnity liabilities.
• **Employees**: Improved company stability and potential for growth opportunities due to a stronger financial position.
• **Creditors (Related Party Note Holders)**: Opportunity to convert debt into equity through the rights offering, demonstrating continued support for the company and potentially improving the Company's cash flow.

Next Steps

• Complete the rights offering to raise capital.
• Repay the Bridge Loan in full at the discounted amount of $7,330,000 prior to April 15, 2026.
• Complete the corporate name change to Bloomia Holdings, Inc. in the coming weeks.
• Change the NASDAQ trading symbol to TULP upon completion of the name change.
• Utilize remaining net cash proceeds from the rights offering for working capital and general corporate purposes.
• Invest in future growth opportunities as they arise.

Key Dates

Recommendation

The company is undertaking a transformative financial restructuring that will significantly de-lever its balance sheet by reducing debt by up to 70% and generating substantial annual interest savings. The ability to settle a $12.75 million bridge loan for $7.33 million represents a massive gain and a clear path to improved profitability. The rights offering, with strong participation intent from related parties and management, provides the necessary capital injection. The rebranding to Bloomia Holdings, Inc. and new ticker TULP better aligns the corporate identity with its core, growing specialty agriculture business. These actions collectively position the company for robust future earnings and long-term value creation, making it a compelling investment opportunity.

Keywords

Lendway, Bloomia, Rights Offering, Debt Reduction, Bridge Loan, Corporate Name Change, TULP, NASDAQ, Specialty Ag, Tulip Production, Capital Raise, Financial Restructuring