Company: BLNE
Filing Date: 2025-01-17
Form Type: PRE 14A
Source: 0001493152-25-002779
Chunk: 61

Company: Beeline Holdings, Inc.
Filing Date: 2025-01-17
Form: PRE 14A
Chunk 61
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 material terms of the ELOC Agreement, Registration Rights Agreement and side letter agreement do not purport to be complete and are qualified in their entirety by the full text of such agreements, which are included as Annex G to this Proxy Statement, which shareholders are urged to review.

Reasons for ELOC

The Company requires access to capital in order to enable it to fund its working capital and general corporate expenses. The Company may also use proceeds from the ELOC to repay indebtedness and to fund its growth initiatives. In addition following the Merger, the Company intends to use the proceeds from the ELOC to fund Beeline’s operations. Beeline’s business is capital intensive given real estate lending requires constant and substantial access to capital. Finally, the additional capital the ELOC presents may if needed help the Company maintain sufficient shareholders’ equity to maintain the minimum amount of $2.5 million in shareholders’ equity required by Nasdaq. The Company previously had a deficiency in its shareholders’ equity in 2024 which was remedied on October 7, 2024 when the debt exchange transactions closed. The closing of the Merger also increased the shareholders’ equity.

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Consequences if the ELOC Share Issuance is Approved

Approval and completion of the ELOC Share Issuance will result in substantial dilution to Eastside’s shareholders. The estimated maximum number of shares of common stock issuable in connection with the Equity Line of Credit is 39,215,686 shares. See also disclosure under “Proposal 1 – The Merger Share Issuance Proposal,” and “Principal Shareholders” at page 51 below for further information on the estimated and potential impact of issuances in connection with the Proposals 1 and 2.

In addition, the combined potential dilution if both the Merger Share Issuance Proposal (Proposal 1) and the Equity Line of Credit Proposal (Proposal 2) are both approved, is an additional 129,848,567 shares of common stock representing approximately 94% of the outstanding common stock post-issuances, compared to 3.4% to be held by shareholders who held their shares prior to such issuances. Further if we are required to issue the holders of Securities described under Proposal 1 additional shares of common stock, that number could increase. For example, we may be required to issue the Series F and F-1 holders up to 70 million additional shares under a special adjustment feature which is described under “Description of Securities – Series F and