MERGER

12 Months Ended

Dec. 31, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

MERGER

4. MERGER

On October 7, 2024, Eastside closed on the Merger with Beeline Financial. The Merger was structured and accounted for as a business combination with Eastside as the acquirer of 100% of the controlling equity interests of Beeline Financial and subsidiaries. The Merger provided a viable opportunity to realign Eastside’s capital, growth trajectory, and potential returns for stakeholders and was structured as an all-stock transaction. The stockholders of Beeline received 69,482,229 preferred shares of Series F and 517,775 preferred shares of Series F-1 of Eastside, see Note 19- Stockholders’ Equity. The Company’s consolidated financial statements for the year ended December 31, 2024 include Beeline’s results of operations from October 8, 2024 through December 31, 2024. 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.

Beeline is a fintech mortgage lender and title provider aimed at transforming the home loan process into a shorter, easier path than conventional mortgage lending for millions of Americans seeking a digital experience. Beeline has built a proprietary mortgage and title platform leveraging advanced technical tools with sophisticated language learning models and combining an appropriate amount of human interaction to create a better outcome for mortgage borrowers.

The purchase price was valued at $48.2 million based on the estimated fair value of the Series F and Series F-1 preferred stock issued on October 7, 2024. The allocation of the purchase price to the fair value of the assets acquired and liabilities assumed and to goodwill was as follows, subject to adjustment during a one-year measurement period from the Merger date:

(Dollars in thousands)	October 7, 2024
Cash and cash equivalents	$	167
Restricted cash		91
Mortgage loans held for sale, net, at fair value		7,242
Interest rate lock commitment derivative		124
Prepaid expenses and other current assets		89
Goodwill		33,310
Intangible assets		4,950
Right-of-use assets		1,406
Property and equipment, net		15,345
Equity method investment		75
Other assets, net		127
Warehouse line of credit		(7,067	)
Accounts payable		(1,614	)
Accrued liabilities		(713	)
Current portion of notes payable and accrued interest, net of discount		(3,671	)
Lease liabilities, net of current portion		(1,603	)
Other noncurrent liabilities		(37	)
	$	48,221

Beeline Holdings, Inc.

Notes to Consolidated Financial Statements

December 31, 2024 and 2023

The Company incurred acquisition related costs of $0.1 million during the year ended December 31, 2024 that have been recorded in general and administrative expenses in the consolidated statements of operations.

For income tax purposes, this is a non-taxable merger as it was an all-stock transaction and accordingly goodwill will not be deductible for tax purposes.

Pro Forma Financial Information

The following unaudited pro forma consolidated results of operations for the years ended December 31, 2024 and 2023 assume that the acquisition of Beeline was completed on January 1, 2023 and exclude the Craft C+P business operations that has been classified as discontinued operations:

(Dollars in thousands)	2024			2023
Pro forma net revenues	$	7,581		$	7,581
Pro forma net losses	$	(16,165	)	$	(18,435	)
Pro forma basic and diluted net loss per share	$	(69.08	)	$	(169.13	)

Pro forma data does not purport to be indicative of the results that would have been obtained had these events actually occurred at the beginning of the periods presented and is not intended to be a projection of future results.