# Beeline Holdings, Inc.: Form 10-Q for the period ended Jun 30, 2025

- Company: [Beeline Holdings, Inc.](/companies/blne.md) (CIK 1534708)
- Form: 10-Q
- Filed: 2025-08-14
- Accepted by EDGAR: Aug 14, 2025, 16:16 ET
- Period: 2025-06-30
- Accession: 0001641172-25-024044
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/1534708/000164117225024044/form10-q.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1534708/000164117225024044/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2025-06-30.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2025-04-01 to 2025-06-30 | $1.7m | us-gaap:Revenues |
| Revenue | 6 months, 2025-01-01 to 2025-06-30 | $3.1m | us-gaap:Revenues |
| Operating income | 3 months, 2025-04-01 to 2025-06-30 | −$3.9m | us-gaap:OperatingIncomeLoss |
| Operating income | 6 months, 2025-01-01 to 2025-06-30 | −$8.6m | us-gaap:OperatingIncomeLoss |
| Interest expense | 3 months, 2025-04-01 to 2025-06-30 | $388.0k | us-gaap:InterestExpenseNonoperating |
| Interest expense | 6 months, 2025-01-01 to 2025-06-30 | $2.3m | us-gaap:InterestExpenseNonoperating |
| Net income | 3 months, 2025-04-01 to 2025-06-30 | −$4.1m | us-gaap:NetIncomeLoss |
| Net income | 6 months, 2025-01-01 to 2025-06-30 | −$10.9m | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2025-04-01 to 2025-06-30 | −$0.64 | us-gaap:EarningsPerShareDiluted |
| Diluted EPS | 6 months, 2025-01-01 to 2025-06-30 | −$3.03 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2025-04-01 to 2025-06-30 | −$0.64 | us-gaap:EarningsPerShareBasic |
| Basic EPS | 6 months, 2025-01-01 to 2025-06-30 | −$3.03 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2025-04-01 to 2025-06-30 | 9,802,147 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Diluted shares (weighted) | 6 months, 2025-01-01 to 2025-06-30 | 5,855,397 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 6 months, 2025-01-01 to 2025-06-30 | −$5.6m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Cash and equivalents | at 2025-06-30 | $6.3m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2025-06-30 | $14.7m | us-gaap:AssetsCurrent |
| Total assets | at 2025-06-30 | $68.6m | us-gaap:Assets |
| Current liabilities | at 2025-06-30 | $12.1m | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2025-06-30 | $13.0m | us-gaap:Liabilities |
| Shareholders' equity | at 2025-06-30 | $54.6m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 52,335 characters.

### Forward-Looking Statements

This section of the Quarterly Report includes “forward-looking statements” as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements give current expectations or forecasts of future events about the company or our outlook and involve uncertainties that could significantly impact results. You can identify forward-looking statements by the fact they do not relate to historical or current facts and by the use of words indicating anticipation or speculation such as “believe,” “expect,” “estimate,” “anticipate,” “will be,” “should,” “plan,” “project,” “intend,” “could” and similar words or expressions.

You should not place undue certainty on these forward-looking statements, which speak only as of the date made. Except as required by law, we undertake no obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from these forward-looking statements. Risk factors and uncertainties that could impact the outcome of matters referred to in forward-looking statements include those discussed in our filings with the Securities and Exchange Commission, including Item 1A of Part I of our annual report on Form 10-K for the year ended December 31, 2024 entitled “Risk Factors” as well as factors which may have not yet been anticipated or identified.

### Objective

The following discussion provides an analysis of the financial condition, cash flows and results of operations from management’s perspective of Beeline Holdings, Inc. (the “Company”). Our objective is to provide discussion of events and uncertainties known to management that are reasonably likely to cause the reported financial information not to be indicative of future operating results or of future financial condition and to also offer information that provides an understanding of our financial condition, cash flows and results of operations.

### Overview

The Company was incorporated under the laws of Nevada in 2004.

#### Merger

On September 4, 2024, the Company entered into an Agreement and Plan of Merger and Reorganization (the “Merger”) with Bridgetown Spirits Corp. (“Bridgetown Spirits”) and Beeline Financial Holdings, Inc. (“Beeline Financial”). The Merger closed on October 7, 2024. On March 12, 2025, the Company changed its name to Beeline Holdings, Inc. (the “Company).

Beeline Financial was incorporated in Delaware on July 1, 2020 via a merger with Beeline Financial Holdings, Inc., a Rhode Island corporation founded on September 20, 2018.

#### Debt Exchange Agreement

On September 4, 2024, the Company and its subsidiary, Craft Canning + Printing (“Craft C+P”), entered into a Debt Exchange Agreement (the “Debt Exchange Agreement”), which closed on October 7, 2024, resulting in the assignment by the Company of 720 barrels of spirits to Craft C+P, followed by the merger of Craft C+P into a limited liability company owned by certain creditors of the Company and the deconsolidation of Craft C+P. The Company accounted for the asset and equity transfers associated with the various transactions at fair value in accordance with ASC 470-60, *Debt - Troubled Debt Restructurings by Debtors.*

Subsequent to the execution of the Debt Exchange Agreement, the Company organized a subsidiary, Bridgetown Spirits, which was incorporated on October 3, 2024, and assigned the Company’s business of manufacturing and marketing spirits to Bridgetown Spirits. The Company owned 53% of Bridgetown Spirits as of June 30, 2025. On July 25, 2025, the Company disposed of its 53% interest in Bridgetown Spirits in exchange for the satisfaction of debt and as a result Bridgetown Spirits is no longer a subsidiary of the Company. The assets and liabilities of Bridgetown Spirits have been classified as held for sale as of June 30, 2025 and December 31, 2024. The operating results of Bridgetown Spirits have been classified as discontinued operations for the three and six months ended June 30, 2025 and 2024.

Upon completion of the Debt Exchange Agreement, the Company was no longer involved in the business of digital printing and mobile canning. The Company reports discontinued operations by applying the following criteria in accordance with ASC 205-20, *Presentation of Financial Statements – Discontinued Operations*: (1) Component of an entity; (2) Held for sale criteria; and (3) Strategic shift. Given that the effect of the Debt Exchange Agreement meets all the criteria for classification of held for sale, the assets and liabilities of Craft C+P were disposed of on October 7, 2024. The operating results of Craft C+P have been classified as discontinued operations during the three and six months ended June 30, 2024.

The consolidated financial statements include the consolidated accounts of the Company and its wholly-owned subsidiaries, Beeline Financial Holdings, Inc. (“Beeline Financial”), Beeline Title Holdings, Inc. (“Beeline Title Holdings”), Beeline Mortgage Holdings, Inc. (“Beeline Mortgage”), Beeline Labs, Inc., and Beeline Loans Pty Ltd. (“Australian Subsidiary”).

Beeline Title Holdings has four subsidiaries, Beeline Title, LLC (“Beeline Title”), Beeline Texas Title, LLC (“Beeline Texas Title”), Beeline Settlement Services, LLC (“Beeline Settlement Services”), and Beeline Title Agency, LLC (“Beeline Title Agency”). Beeline Mortgage Holdings has one subsidiary, Beeline Loans, Inc. (“Beeline Loans”).

The Company has one majority-owned subsidiary, Nimble Title Holdings, Inc. (“Nimble Title Holdings”). Nimble Title Holdings is 50.1% owned by the Company and 49.9% owned by a former non-controlling shareholder of Beeline Financial.

Nimble Title Holdings has four subsidiaries, Nimble Title, LLC (“Nimble Title”), Nimble Title Agency, LLC (“Nimble Title Agency”), Nimble Texas Title, LLC (“Nimble Texas Title”), and Nimble Settlement Services, LLC (“Nimble Settlement Services”).

The discussion which follows should be read in conjunction with the consolidated financial statements and notes to the consolidated financial statements contained in this Report.

### Our Business

Beeline Financial is the holding company for Beeline Loans, Beeline Title Holdings and Beeline Labs. Through its subsidiaries, the group operates a full-service, direct-to-consumer digital mortgage lender specializing in conventional conforming and non-conforming residential first-lien mortgages, a title provider offering title, escrow, and closing services, and a technology platform licensing a proprietary software-as-a-service (“SaaS”) product. Additionally, Beeline Loans, through a technology platform that it has built, supports a fractional equity product in partnership another company, which uses cryptocurrency backed by residential real estate.

#### Beeline Financial

Beeline Financial’s performance is influenced by several key factors, including fluctuations in interest rates, economic conditions, housing supply, technological advancements, and its ability to acquire and retain customers. Interest rate changes have a direct impact on mortgage loan refinancing and overall mortgage loan volume. In a declining interest rate environment, refinancing activity typically increases, whereas rising interest rates tend to reduce refinancing and home purchase transactions. However, higher rates can also drive demand for cash-out refinancings and home equity loans. Following a prolonged period of historically low rates, interest rates began to rise in April 2021 due to inflation, increases in the federal funds rate, and other monetary policies. This upward trend, which continued through 2023, significantly reduced mortgage market activity and the pool of borrowers who could benefit from refinancing. Additionally, higher rates discourage homebuyers from entering the market and lead to a more competitive lending environment, compressing margins and reducing origination volumes.

The broader economic environment plays a crucial role in mortgage lending activity. Interest rate movements, employment trends, home price appreciation, and consumer confidence all affect mortgage origination volumes. Typically, home sales peak in the second and third quarters, but in 2022 and 2023, rising interest rates and ongoing housing supply constraints disrupted these seasonal trends. Despite steady consumer demand for credit, high interest rates and economic uncertainty may cause borrowers to delay financing decisions, leading to fluctuations in Beeline’s revenue and financial performance.

Limited housing supply has constrained home purchase activity. Rising interest rates have further exacerbated this issue by increasing home prices, reducing affordability, and discouraging transactions. However, Beeline believes that persistent imbalances between supply and demand will ultimately drive greater home construction, expanding housing inventory and stimulating future mortgage activity.

Beeline Financial’s ability to attract and retain customers depends on delivering a seamless and competitive digital mortgage experience. The shift toward digital transactions, accelerated by the COVID-19 pandemic, has increased consumer willingness to engage in high-value online purchases, including mortgage applications. Beeline Financial’s platform is designed to provide a convenient and efficient digital experience, positioning it favorably against traditional mortgage origination methods. With Millennial and Generation Z homeownership rates on the rise, Beeline Financial anticipates continued growth in demand for digital mortgage solutions.

Technological innovation remains central to Beeline Financial’s strategy. Beeline Financial’s proprietary technology enhances efficiency, reduces costs, and improves loan processing quality. By automating key origination tasks, Beeline Financial streamlines interactions for consumers, employees, and partners. Its intuitive digital interface minimizes reliance on paper applications and manual processes, enabling faster and more efficient loan transactions. Continued investment in automation and technology development will further reduce production costs and enhance customer acquisition efforts.

Customer acquisition is another critical component of Beeline Financial’s success. Beeline Financial aims to expand its reach while providing a highly personalized digital experience. If traditional customer acquisition methods prove insufficient, especially in challenging market conditions, Beeline Financial may need to invest additional resources in sales and marketing to maintain growth. Increased marketing expenditures could elevate service costs, making it essential to balance customer acquisition efforts with cost efficiency.

In the ordinary course of Beeline Financial’s operations, it finances the majority of its loan volume on a short-term basis, typically less than 10 days, mainly utilizing a warehouse line of credit with a capacity of $5.0 million. The repayments of Beeline Financial’s borrowings come from the revenue generated by selling its loans to a network of purchasers.

In 2024, Beeline Financial made significant investments in its platform to leverage mortgage origination opportunities, despite overall lower volumes compared to 2020 and 2021 due to fluctuating interest rates. In the fourth quarter, a temporary decline in the 10-year Treasury rate drove a notable increase in loan originations, reinforcing our belief that interest rates, housing supply, and affordability will remain key factors influencing future volume. Additionally, Beeline Financial has expanded its focus on its B2B SaaS strategy, which is also subject to macroeconomic conditions.

To measure operational efficiency and growth, we track a range of performance metrics in our lending and title businesses, including production data. Beeline Loans, the principal operating subsidiary of Beeline Financial, uses data to track margin and gain-on-sale revenue. The title companies use data to track file revenue. Beeline uses industry tools to benchmark its margin and note rates against the broader mortgage origination market. We also evaluate key business drivers for Beeline Financial subsidiaries, such as Beeline Labs, by monitoring revenue, unit sales, and SaaS (B2B) growth potential. Additionally, we assess customer acquisition costs and profitability per loan to optimize financial performance. These key indicators help gauge progress toward our strategic and long-term growth objectives.

### Recent Developments

### Business Trends

From January through July 2025, U.S. inflation trended lower, though the pace of improvement varied across components. Headline consumer price index (“CPI”) began the year at roughly 2.9% year-over-year in January, down from 3.2% in December 2024, as energy prices eased, food inflation moderated, and shelter costs began to cool. February saw a slight drop to around 2.8%, with goods inflation largely flat or negative due to stable commodity prices, though services—particularly housing and medical care—remained sticky. By March, CPI slowed to roughly 2.7%, driven by declines in core goods, but higher transportation services costs offset some gains. April brought further moderation to around 2.6% as shelter inflation eased faster than expected and gasoline prices fell on higher refinery output, prompting markets to price in possible rate cuts later in the year. In May, CPI reached about 2.5%, with food prices steady and some goods categories, like apparel and home products, seeing discounts, though insurance costs kept services inflation above 3%. June’s reading of roughly 2.4% marked the lowest since early 2021, led by falling energy prices and continued shelter relief, even as core services ex-housing stayed elevated. Preliminary July figures suggest inflation held near 2.4–2.5%, with headline prices little changed month-over-month and core inflation hovering around 2.7%, reflecting lingering service-sector pressures. Overall, inflation progress in the first half of 2025 was steady, supported by improved supply chains, softer housing costs, and easing commodity prices. However, the Federal Reserve maintained a cautious stance, signaling that while headline inflation was back near its comfort zone, persistent services inflation meant rate cuts would likely wait until late 2025, assuming the disinflationary trend continues.

#### Beeline Labs

In July 2025, the Company’s subsidiary, Beeline Labs, launched BlinkQC, a SaaS platform designed to automate pre-close quality control (“QC”) reviews for mortgage loan files. Beeline Loans has been beta testing BlinkQC in its own operation and will use BlinkQC for its pre-close QC. Later this year, Beeline Labs plans to license BlinkQC as SaaS to other mortgage companies. BlinkQC uses artificial intelligence to ingest loan document packages, extract and validate data, apply customizable rule sets, and generate compliance reports.

The initial release supports conventional loan packages and is offered on a flat rate per package. Based on current cost estimates, the product is expected to achieve gross margins of approximately 50%. Future enhancements, including FHA/VA loan support and integrations with loan origination systems, are in development.

Management believes BlinkQC will improve QC efficiency for mortgage lenders and represents a potential source of incremental revenue for the Company.

#### BeelineEQUITY

On June 25, 2025, Beeline Title closed, what it believes to be one of the first-ever fractional sale of home real estate transactions funded through the sale of a cryptocurrency with a partner who will fund these transactions for us through the sale of a crypto token which is backed by real property. While neither the Company, nor its subsidiaries, mints the token, Beeline Title will handle the settlement and title portions of these transactions for its client, who is minting the token (see below for more information about this company). The June transaction marked a major milestone in the evolution of blockchain-driven real estate finance, bridging decentralized finance with traditional title and escrow services. In the third quarter of 2025, Beeline Loans will provide customer acquisition services and support to the company minting the token and offering the equity exchange and Beeline Title will provide the title and closing services for each transaction—unless borrowers elect to use an outside title company. Importantly, Beeline Title will open this platform to all mortgage lenders, giving them access to a proven solution for cryptocurrency token transaction reconciliation, compliance, and disbursement. As cryptocurrency adoption accelerates and becomes regulated by federal and state governments, the Company is positioning itself as a leader in this fast-moving ecosystem, offering trusted infrastructure to help lenders scale into a future where crypto and compliance go hand-in-hand. The Company collaborates with a related party company which is co-owned by the Company’s Chief Executive Officer, Nicholas Liuzza, by which the company funds the transactions through the sale of a cryptocurrency token which is backed by real property. See Note 19 – Related Party Transactions in the footnotes to the financial statements contained in this report. Passing of the GENIUS Act in June 2025 has delayed the full launch of Beeline Equity to early quarter four of 2025. Prior to a full launch, Beeline Loans and Beeline Title will close many transactions as the product and process are perfected.

### Results of Operations

The Merger was structured and accounted for as a business combination with the Company as the acquirer of 100% of the controlling equity interests of Beeline Financial and its subsidiaries. The Company’s consolidated financial statements for the six months ended June 30, 2024 do not include Beeline Financial’s results of operations. The Company’s consolidated financial statements reflect the final purchase accounting adjustments in accordance with ASC 805, *Business Combinations*, whereby the purchase price was allocated to the assets acquired and liabilities assumed based upon their estimated fair values on the acquisition date. Due to the Merger, management believes that the consolidated results of operations for 2025 are not directly comparable to those of 2024, as the prior year reflects the performance of only the corporate segment.

Certain prior year amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations or cash flows. As a result of the merger, the statement of operations for the three and six months ended June 30, 2024 represents the new structure and retrospectively reclassifies discontinued operations.

As a result of the structure of the Merger, the Company will amortize $15.2 million over a five-year period ending October 2029 and $0.4 million over a four-year period ending October 2028. This Merger-related amortization is $0.8 million each quarter and is non-cash.

Given these structural changes, management believes that segment-level reporting provides a more meaningful basis for evaluating performance. Accordingly, a comparative analysis of the Company’s operating segments is presented below, which more accurately reflects the ongoing composition of the business.

### Three and Six Months Ended June 30, 2025 Compared to the Three and Six Months Ended June 30, 2024

### Consolidated Results

*(Dollars in thousands, except per share amounts)*

|  | Three Months Ended June 30, 2025 | 2024 | Six Months Ended June 30, 2025 | 2024 |
| --- | ---: | ---: | ---: | ---: |
| Beeline Financial Revenues | $1,717 | $- | $3,067 | $- |
| Net loss from continuing operations | $(4,002) | $(658) | $(10,705) | $(1,270) |
| Net loss | (4,140) | (1,488) | (11,067) | (2,781) |
| Basic and diluted net loss per common share available to common stockholders | $(0.64) | $(8.74) | $(3.03) | $(16.55) |

For the three and six months ended June 30, 2025, net loss from continuing operations increased to $4.0 million and $10.7 million, respectively, from $0.7 million and $1.3 million for the three and six months ended June 30, 2024, respectively, reflecting the inclusion of Beeline’s results of operations for 2025.

***Interest Expense.*** Interest expense, exclusive of the warehouse line of credit, was $0.4 million and $2.3 million for the three and six months ended June 30, 2025, respectively, and $0.3 million and $0.6 million for the three and six months ended June 30, 2024, respectively, primarily related to interest on debt and the amortization of debt and warrant related expenses.

***Preferred stock dividends.*** Preferred stock dividends were $37,500 and $0.1 million for each of the three and six months ended June 30, 2025 and 2024, respectively, representing the Series B preferred stock dividend of 6% per annum.

***Deemed dividend - preferred stock Series G and warrant price protection.*** On March 25, 2025, the Company sold shares under the ELOC at $1.67 per share, which was less than the Series G Preferred Stock original conversion price of $5.10 per share, resulting in the reduction of the conversion price of the Series G Preferred Stock to $1.67 per share as a result of the price protection adjustment related to the conversion of the Series G Preferred Stock. Additionally, the Warrants issued in the Series G Preferred Stock offering had their exercise price reduced to $1.67 and resulted in an increase in common shares issuable upon exercise of 1,774,986 under the full price protection adjustment of the Warrants. On June 16, 2025, the Company sold shares under the ELOC at $0.66 per share, which was less than the exercise price of the Warrants adjusted in March 2025, resulting in the reduction of the exercise price of the warrants to $0.66 per share and an increase in common shares issuable upon exercise of 3,655,482 under the full price protection adjustment of the Warrants. The Company recorded a deemed dividend related to the price protection of $2.2 million and $6.8 million for the three and six months ended June 30, 2025, respectively.

### Segment Reporting

The following discussion provides an analysis of the financial performance of each of our reportable segments consisting of Beeline Financial and Corporate. We evaluate segment performance based on key financial and operational metrics, including revenue, operating income, and margin trends. The results of each segment are presented in accordance with our internal management reporting structure.

Beeline Financial is a full service Direct-to-Consumer lender specializing in conventional conforming and non-conforming residential first-lien mortgages and providing title services. Beeline Financial also has an emerging business in anonymized data sales and technology licensing.

Corporate primarily consists of general corporate expenses, including public company costs, executive compensation, legal and regulatory compliance, and other administrative functions that support the overall business. This segment also includes holding company expenses, such as financing costs, investor relations, and strategic corporate initiatives that are not directly attributable to any operating segment. As this segment does not generate revenue, its financial results primarily reflect overhead, and governance-related expenditures incurred to support the company’s publicly traded status and corporate infrastructure.

*(Dollars in thousands)*

|  | Three Months Ended June 30, 2025 | 2024 | Six Months Ended June 30, 2025 | 2024 |
| --- | ---: | ---: | ---: | ---: |
| **Beeline Financial Revenues** | **$1,717** | **$-** | **$3,067** | **$-** |
| Beeline Financial | $(1,568) | $- | $(3,893) | $- |
| Corporate | (2,434) | (658) | (6,812) | (1,270) |
| **Total net loss from continuing operations** | **$(4,002)** | **$(658)** | **$(10,705)** | **$(1,270)** |

### Beeline Financial (For the Three and Six Months Ended June 30, 2025)

*(Dollars in thousands)*

|  | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 |
| --- | ---: | ---: |
| Gain on sale of loans, net | $1,113 | $1,927 |
| Title fees | 405 | 781 |
| Loan origination fees | 186 | 336 |
| Interest income | 71 | 142 |
| Interest expense | (64) | (129) |
| Data and tech services | 6 | 10 |
| Total net revenues | 1,717 | 3,067 |
| Salaries and benefits | 1,348 | 2,515 |
| Marketing and advertising | 778 | 1,305 |
| Professional fees | 70 | 105 |
| General and administrative expenses | (66) | 429 |
| Depreciation and amortization | 812 | 1,607 |
| Other operating expenses | 332 | 975 |
| Total operating expenses | 3,274 | 6,936 |
| Loss from operations | (1,557) | (3,869) |
| Interest expense | (10) | (20) |
| Other expense | (1) | (4) |
| **Net loss** | **$(1,568)** | **$(3,893)** |

For the three and six months ended June 30, 2025, Beeline Financial originated $15.1 million and $54.9 million in residential mortgage loans and reported net revenues of $1.7 million and $3.1 million and a net loss of $1.6 million and $3.9 million, respectively.

***Gain on sale of loans, net.*** Gain on sale of loans, net consists of all components related to the origination and sale of mortgage loans, including (1) net gain on sale of loans, which represents the premium we receive in excess of the loan principal amount and certain fees charged by investors upon sale of loans into the secondary market, (2) loan origination fees, credits, points and certain costs, (3) provision for or benefit from investor reserves, and (4) the change in fair value of interest rate lock commitment (“IRLCs” or “rate lock”) and mortgage loans held for sale.

When the mortgage loan is sold into the secondary market (i.e. funded), any difference between the proceeds received and the current fair value of the loan is recognized in current period earnings in gain on sale of loans. Gain on sale of loans, net was $1.0 million and $1.9 million for the three and six months ended June 30, 2025, respectively.

***Title fees.*** Title fees consist of title policy premiums and settlement fees charged to the borrower and seller on a transaction. Title fees were $0.4 million and $0.8 million for the three and six months ended June 30, 2025, respectively.

***Loan origination fees.*** Loan origination fees generally include underwriting and processing fees, investor fees, and other related expenses. Loan origination fees were $0.2 million and $0.3 million for the three and six months ended June 30, 2025, respectively.

***Loan interest income and expense.*** Interest income is interest earned on mortgage loans held for sale and interest expense is paid on our loan funding facilities. Net interest income was $7,075 and $13,110 for the three and six months ended June 30, 2025, respectively.

***Salaries and benefits.*** Salaries and benefits were $1.3 million and $2.5 million for the three and six months ended June 30, 2025, respectively.

***Marketing and advertising.*** Marketing and advertising were $0.8 million and $1.3 million for the three and six months ended June 30, 2025, respectively.

***General and administrative expenses.*** General and administrative expenses consist primarily of software service providers and were flat and $0.4 million for the three and six months ended June 30, 2025, respectively.

***Depreciation and amortization.*** Depreciation and amortization expenses consist primarily of amortization related to internal-use software and was $0.8 million and $1.6 million for the three and six months ended June 30, 2025, respectively.

***Other operating expenses.*** Other operating expenses consist of expenses directly related to the origination of loans and are charged by investors at the sale of loans excluding interest. Other operating expenses were $0.3 million and $1.0 million for the three and six months ended June 30, 2025, respectively.

### Corporate

*(Dollars in thousands)*

|  | Three Months Ended June 30, 2025 | 2024 | Six Months Ended June 30, 2025 | 2024 |
| --- | ---: | ---: | ---: | ---: |
| Salaries and benefits | $817 | $161 | $1,819 | $364 |
| Marketing and advertising | 9 | - | 12 | - |
| Professional fees | 1,154 | 88 | 2,285 | 133 |
| General and administrative expenses | 272 | 87 | 488 | 189 |
| Depreciation and amortization | 24 | 14 | 49 | 28 |
| Other operating expenses | 98 | - | 107 | - |
| Total operating expenses | 2,374 | 350 | 4,760 | 714 |
| Interest income | - | - | 1 | - |
| Interest expense | (378) | (308) | (2,257) | (556) |
| Gain on extinguishment of debt | 75 | - | 75 | - |
| Change in equity method investment | 204 | - | 129 | - |
| Other income | 39 | - | - | - |
| **Net loss** | **$(2,434)** | **$(658)** | **$(6,812)** | **$(1,270)** |

### Non-GAAP Financial Measure

We report adjusted EBITDA, which is a financial measure not prepared in accordance with generally accepted accounting principles (“non-GAAP”) that supplements our financial results presented in accordance with GAAP. This non-GAAP financial measure should not be considered in isolation and is not intended to be a substitute for any GAAP financial measures, but rather provides supplemental information that we believe helps investors better understand our business, our business model, and how we analyze our performance.

Non-GAAP financial measures have limitations in their usefulness to investors because they have no standardized meaning and are not prepared under any comprehensive set of accounting rules or principles. Accordingly, other companies, including companies in our industry, may calculate similarly titled non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison.

We include a reconciliation of adjusted EBITDA to GAAP net loss, its most closely comparable GAAP measure. We encourage investors and others to review our condensed consolidated financial statements and notes thereto in their entirety included elsewhere in this quarterly report on Form 10-Q, not to rely on any single financial measure, and to consider adjusted EBITDA only in conjunction with its respective most closely comparable GAAP financial measure.

We believe this non-GAAP financial measure is useful to investors for supplemental period-to-period comparisons of our business and understanding and evaluating our operating results for the following reasons:

- Adjusted EBITDA is widely used by investors and securities analysts to measure a company’s operating performance without regard to items such as depreciation and amortization expense, interest and amortization on non-funding debt, income tax expense, stock-based compensation expense, and costs that are unique or non-recurring in nature or otherwise unrelated to our ongoing revenue-generating operations, all of which can vary substantially from company to company depending on their financing and capital structures;
- We use adjusted EBITDA in conjunction with financial measures prepared in accordance with GAAP for adjusted purposes, including the preparation of our annual operating budget , as a measure of our core operating results and the effectiveness of our business strategy, and in evaluating our financial performance; and
- Adjusted EBITDA provides consistency and comparability with our past financial performance, facilitates period-to-period comparisons of our core operating results, and also facilitates comparisons with other peer companies, many of which use similar non-GAAP financial measures to supplement their GAAP results.

Further, although we use this non-GAAP measure to assess the financial performance of our business, it has limitations as an analytical tool, and should not be considered in isolation or as a substitute for analysis of our financial results as reported under GAAP. Some of these limitations are, or may in the future be, as follows:

- Although depreciation and amortization expense is a non-cash charge, the assets being depreciated and amortized may have to be replaced in the future, and adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements;
- Adjusted EBITDA excludes stock-based compensation expense which is a significant recurring expense for our business and an important part of our compensation strategy;
- Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;
- Adjusted EBITDA does not reflect interest expense, or the cash requirements necessary to service interest or principal payments on our non-funding debt, which reduces cash available to us; and
- The expenses and other items that we exclude in the calculation of adjusted EBITDA may differ from the expenses and other items, if any, that other companies may exclude from similarly titled non-GAAP measures when they report their operating results, and we may, in the future, exclude other significant, unusual or non-recurring expenses or other items from these financial measures.

Because of these limitations, adjusted EBITDA should be considered along with other financial performance measures presented in accordance with GAAP, and not as an alternative or substitute for our financial results prepared and presented in accordance with GAAP.

### Adjusted EBITDA

We calculate adjusted EBITDA as net income (loss) adjusted for the impact of interest expense, depreciation and amortization expense, net loss from discontinued operations, stock-based compensation expense, and other non-recurring or non-core operational expenses.

The following table presents a reconciliation of net income (loss) to adjusted EBITDA:

*(Dollars in thousands)*

|  | Three Months Ended June 30, 2025 | 2024 | Six Months Ended June 30, 2025 | 2024 |
| --- | ---: | ---: | ---: | ---: |
| Net loss | $(4,140) | $(1,488) | $(11,067) | $(2,781) |
| Interest expense | 388 | 308 | 2,277 | 556 |
| Depreciation and amortization | 836 | 14 | 1,656 | 28 |
| Net loss from discontinued operations | 138 | 830 | 362 | 1,511 |
| Stock-based compensation expense | - | 30 | 130 | 132 |
| Merger-related expenses (1) | - | - | 321 | - |
| **Adjusted EBITDA** | **$(2,778)** | **$(306)** | **$(6,321)** | **$(554)** |

**(1)** Merger-related expenses include the costs related to the shareholder meeting on March 7, 2025 to approve the name changing to Beeline Holdings, Inc. and to approve the Series F and F-1 Preferred Stock (shares received in the merger) to convert to common shares, as well as costs related to the Nasdaq initial listing.

### Capital Resources and Liquidity

***Financial Policy***. We intend to maintain a disciplined financial policy and improve our credit metrics, which are critical to our lending partners.

***Liquidity Policy.*** We maintain a strong focus on liquidity and define our liquidity risk tolerance based on sources and uses to maintain a sufficient liquidity position to meet our business needs and financial obligations under both normal and stressed conditions. We believe that our consolidated liquidity and availability under our revolving credit facilities will be sufficient to meet our liquidity needs.

***Liquidity.*** Our primary sources of liquidity consist of cash and cash equivalents, cash flow from our operating businesses, proceeds from asset sales and dispositions, and short-term borrowing facilities, including revolving credit lines. Cash generation may fluctuate due to various factors, including seasonality, timing of loan originations and repayments, market conditions, and our ability to execute strategic asset sales or dispositions. As of June 30, 2025, we have $6.3 million in cash.

On December 31, 2024, the Company entered into entered into a Common Stock Purchase Agreement and related Registration Rights Agreement (collectively, the “ELOC Agreement”) with an institutional investor (the “Purchaser”) pursuant to which the Company agreed to sell, and the Purchaser agreed to purchase, up to $35 million of the Company’s common stock, subject to a sale limit of 19.99% of the outstanding shares of the Company’s common stock. On March 7, 2025, the Company entered into an Amended ELOC Agreement to reduce the amount from $35 million to $10 million. During the six months ended June 30, 2025, the Company sold and issued to the Purchaser 5,018,437 shares of common stock for gross proceeds of $6.5 million. Subsequent to June 30, 2025, the Company sold and issued to the Purchaser 676,078 shares of common stock for gross proceeds of $1.2 million to the Purchaser.

On April 30, 2025, the Company entered into an At The Market Offering Agreement (the “ATM Agreement”) with Ladenburg Thalmann & Co., Inc., pursuant to which the Company may issue and sell over time and from time to time, to or through Ladenburg, up to $7.0 million of shares of the Company’s common stock. During the six months ended June 30, 2025, the Company sold 5,540,043 shares for gross proceeds of $7.0 million.

During the six months ended June 30, 2025, the Company sold 6,417,159 shares of Series G Preferred Stock and five-year Warrants to purchase a total of 320,862 shares of common stock for total gross proceeds of $3.3 million.

As of July 23, 2025, the Company has sold the maximum amounts that were registered under each of the ELOC Agreement and the ATM Agreement. As a result of the foregoing, the at-the-market offering is now closed. The ELOC Agreement provides for up to $3.0 million in additional sales of common stock at the Company’s option, subject to the terms and conditions of the ELOC Agreement including registration requirements therein.

The Company intends to continue raising capital through a combination of equity and debt financing to meet its internal cash requirements and to refinance its existing obligations. The availability of additional financing will be largely dependent on our operating success, including improved gross margins as well as operational improvements, which will be necessary to attract investors. However, there can be no assurance that the Company will be successful in securing the necessary capital on favorable terms, or at all. The Company has no material off-balance sheet arrangements as of the date of this filing.

***Statements of Cash Flows.*** For 2025, our primary capital requirements have been for cash used in operating activities and for the repayment of debt. Funds for our cash and liquidity needs have historically not been generated from operations but rather from short-term credit in the form of extended payment terms from suppliers as well as proceeds from loans and the sale of convertible debt and equity. We have been dependent on raising capital from debt and equity financing to meet our operating needs.

For the six months ended June 30, 2025 and 2024, net cash used in operating activities of continuing operations increased to $5.6 million from $0.6 million, respectively, primarily due to the inclusion of Beeline’s net loss of $3.9 million for the six months ended June 30, 2025.

For the six months ended June 30, 2025, net cash used in investing activities of continuing operations was $0.1 million related to internal-use software development costs. For the six months ended June 30, 2024, investing activities were nil.

For the six months ended June 30, 2025, net cash provided by financing activities of continuing operations was $10.9 million primarily from $15.8 million raised from equity transactions, offset by repayments of $0.9 million of the warehouse line and $4.1 million of secured credit facilities. For the six months ended June 30, 2024, net cash provided by financing activities of continuing operations was $1.1 million.

### Critical Accounting Policies and Estimates

Critical accounting policies and practices are those that are both most important to the portrayal of the Company’s financial condition and results, and require management’s most difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain. The critical accounting policies and practices used by the Company in the financial statements for six months ended June 30, 2025 relate to the policies and practices the Company uses to account for:

***Mortgage loans held for sale and gains on sale of loans revenue recognition.*** Mortgage loans held for sale are carried at fair value under the fair value option in accordance with ASC 825, *Financial Instruments*, with changes in fair value recorded in gain on sale of loans, net on the consolidated statements of operations. The fair value of mortgage loans held for sale committed to investors is calculated using observable market information such as the investor commitment, assignment of trade or other mandatory delivery commitment prices. The fair value of mortgage loans held for sale not committed to investors is based on quoted best execution secondary market prices. If no such quoted price exists, the fair value is determined using quoted prices for a similar asset or assets, such as Mortgage-Backed Securities (“MBS”) prices, adjusted for the specific attributes of that loan, which would be used by other market participants. Mortgage loans held for sale not calculated using observable market information are based on third-party broker quotations or market bid pricing.

Gains and losses from the sale of mortgage loans held for sale are recognized based upon the difference between the sales proceeds and carrying value of the related loans upon sale and are recorded in gain on sale of loans, net on the consolidated statements of operations. Sales proceeds reflect the cash received from investors through the sale of the loan and servicing release premium. Gain on sale of loans, net also includes the unrealized gains and losses associated with the changes in the fair value of mortgage loans held for sale, and the realized and unrealized gains and losses from derivative instruments.

Mortgage loans held for sale are considered sold when the Company surrenders control over the financial assets. Control is considered to have been surrendered when the transferred assets have been isolated from the Company, beyond the reach of the Company and its creditors; the purchaser obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets; and the Company does not maintain effective control over the transferred assets through either an agreement that both entitles and obligates the Company to repurchase or redeem the transferred assets before their maturity or the ability to unilaterally cause the holder to return specific financial assets. The Company typically considers the above criteria to have been met upon acceptance and receipt of sales proceeds from the purchaser.

Mortgage loans sold to investors by the Company, and which met investor underwriting guidelines at the time of sale, may be subject to repurchase in the event of specific default by the borrower or subsequent discovery that underwriting standards were not met. The Company may, upon mutual agreement, indemnify the investor against future losses on such loans. Additionally, reserves are established for estimated liabilities from the need to repay, where applicable, a portion of the premium received from investors on the sale of certain mortgage loans if such loans are repaid in their entirety within a specified period after the sale of the loans. The Company has established a reserve for potential losses related to these representations and warranties. In assessing the adequacy of the reserve, management evaluates various factors, including actual write-offs during the period, historical loss experience, known delinquent and other problem loans, and economic trends and conditions in the industry. Actual losses incurred are reflected as write-offs against the loan indemnification reserve.

Since mortgage loans held for sale have maturity dates greater than one year from the balance sheet date but are expected to be sold in a short time frame (less than one year), they are recorded as current assets.

Changes in the balance of mortgage loans held for sale are included in cash flows from operating activities in the consolidated statements of cash flows in accordance with ASC 230-10-45-21, *Statement of Cash Flows.*

### Revenue recognition

#### Gains on Sale of Loans, Net

See discussion above under “Mortgage Loans Held for Sale and Gain on Sale of Loans Revenue Recognition” and below under “Derivative Financial Instruments and Revenue Recognition”.

#### Title Fees

Settlement fees and commissions earned at loan settlement on insurance premiums paid to title insurance companies.

#### Loan Origination Fees and Costs

Loan origination fees represent revenue earned from originating mortgage loans. Loan origination fees generally represent flat per-loan fee amounts and are recognized as revenue at the time the mortgage loans are funded since the loans are held for sale. Loan origination costs are charged to operations as incurred.

#### Interest Income

Interest income on mortgage loans held for sale is recognized for the period from loan funding to sale based upon the principal balance outstanding and contractual interest rates. Revenue recognition is discontinued when loans become 90 days delinquent, or when, in management’s opinion, the recovery of principal and interest becomes doubtful and the mortgage loans held for sale are put on nonaccrual status. For loans that have been modified, a period of six payments is required before the loan is returned to an accrual basis.

#### Interest Expense

Interest expense relating to the warehouse lines of credit is included in net revenues. Other interest expense is included in other (income)/expense.

#### Data and Tech

Fees received from a marketing partner that is embedded in the Company’s point-of-sale journey for investment property customers. The partner pays Beeline for leads they receive from a customer opting in to use their insurance company for landlord insurance during the application process.

***Derivative financial instruments and revenue recognition.*** The Company holds and issues derivative financial instruments such as IRLCs. IRLCs are subject to price risk primarily related to fluctuations in market interest rates. To hedge the interest rate risk on certain IRLCs, the Company enters into best effort forward sale commitments with investors, whereby certain loans are locked with a borrower and simultaneously committed to an investor at a fixed price. If the best effort IRLC does not fund, the Company has no obligation to fulfill the investor commitment.

ASC 815-25, *Derivatives and Hedging*, requires that all derivative instruments be recognized as assets or liabilities on the consolidated balance sheets at their fair value. Changes in the fair value of the derivative instruments are recognized in gain on sale of loans, net on the consolidated statements of operations in the period in which they occur. The Company accounts for all derivative instruments as free-standing derivative instruments and does not designate any for hedge accounting.

***Business Combination.*** The Company accounts for business combinations in accordance with ASC 805, *Business Combinations*. Under this guidance, the Company allocates the purchase price of an acquired business to the identifiable assets acquired and liabilities assumed at their estimated fair values as of the acquisition date. The excess of the purchase price over the estimated fair value of net assets acquired is recorded as goodwill.

Goodwill represents the excess purchase price over the fair value of the tangible net assets and intangible assets acquired in the business combination. The increases or decreases in the fair value of the Company’s assets and liabilities can result from changes in fair values as of the acquisition date as determined during the one-year measurement period under ASC 805.

***Goodwill.*** Goodwill is the excess of the purchase price over the estimated fair value of identifiable net assets acquired in business combinations. The Company tests goodwill for impairment annually in the fourth quarter, or more frequently when indications of potential impairment exist. The Company monitors the existence of potential impairment indicators throughout the fiscal year. The Company may elect to perform either a qualitative test or a quantitative test to determine if it is more likely than not that the carrying value of a reporting unit exceeds its estimated fair value. Fair value reflects the price a market participant would be willing to pay in a potential sale of the reporting unit. If the estimated fair value of the Company exceeds its carrying value, then the Company concludes the goodwill is not impaired. If the carrying value of the Company exceeds its estimated fair value, the Company recognizes an impairment loss in an amount equal to the excess, not to exceed the amount of goodwill.

***Intangible assets.*** The Company accounts for certain finite-lived intangible assets at amortized cost and other certain indefinite-lived intangible assets at cost. Management reviews all intangible assets for probable impairment whenever events or circumstances indicate that the carrying amount of such assets may not be recoverable. If there is an indication of impairment, management would prepare an estimate of future cash flows (undiscounted and without interest charges) expected to result from the use of the asset and its eventual disposition. If these estimated cash flows were less than the carrying amount of the asset, an impairment loss would be recognized to write down the asset to its estimated fair value.

***Property and equipment, net.*** Property and equipment, including leasehold improvements and internal-use software, are recorded at cost, and are depreciated or amortized using the straight-line method over the estimated useful lives of the related assets, which range from three to seven years. Repair and maintenance costs are expensed as incurred. Leasehold improvements are amortized over the shorter of the lease term or the improvement’s estimated useful life. Depreciation is not recorded on projects-in-process until the project is complete and the associated assets are placed into service or are ready for the intended use. Impairment of property and equipment than the internal-use software is evaluated under ASC 360, *Property, Plant, and Equipment.*

Under ASC 350-40, *Internal-Use Software*, the Company capitalizes certain qualifying costs incurred during the application development stage in connection with the development of internal-use software. Costs related to preliminary project activities are expensed as incurred and post-implementation activities will be expensed as incurred. Capitalized software costs are amortized over the useful life of the software, which is five years. Impairment of internal-use software is evaluated under ASC 350-40-35, *Subsequent Measurement,* on a qualitative basis and if indicators exist, then a quantitative analysis is performed under ASC 360.

***Stock-based compensation.*** The Company recognizes as compensation expense all stock-based awards issued to employees. The compensation cost is measured based on the grant-date fair value of the related stock-based awards and is recognized over the service period of stock-based awards, which is generally the same as the vesting period. The fair value of stock options is determined using the Black-Scholes valuation model, which estimates the fair value of each award on the date of grant based on a variety of assumptions including expected stock price volatility, expected terms of the awards, risk-free interest rate, and dividend rates, if applicable. Stock-based awards issued to nonemployees are recorded at fair value on the measurement date and recognized over the service periods.

## Market risk

As filed, 139 characters.

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, we are not required to provide information required by this item.

## Controls and procedures

As filed, 1,450 characters.

We maintain disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (“Exchange Act”) that are designed to provide reasonable assurances that the information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC rules and forms and that such information is accumulated and communicated to management, including the Chief Executive Officer and the Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.

We conducted an evaluation (pursuant to Rule 13a-15(b) of the Exchange Act)), under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e)) as of the end of the period covered by this report. Based on the evaluation, the Chief Executive Officer and Chief Financial Officer has concluded that these disclosure controls and procedures were effective as of June 30, 2025.

There were no changes in internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) during the quarter ended June 30, 2025, that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Filed Aug 14, 2025.
Source: SEC EDGAR, the filing index for accession 0001641172-25-024044. Last ingested by Listed: Nov 2, 2026, 08:29 ET. No prices; not investment advice.