[Form 4] Lendway, Inc. Insider Trading Activity

Rhea-AI Filing Summary

Royal Bank of Canada (RY) intends to issue Accelerated Return Notes (ARNs) linked to the S&P 500 Index under its Series J MTN program. The preliminary 424(b)(2) term sheet details a short-dated, market-linked note structured for retail distribution through BofA Securities and Merrill Lynch.

Key economic terms

• Principal: US$10 per unit; senior unsecured debt of RBC.
• Tenor: ~14 months, maturing September 2026.
• Upside: 300% participation in any index increase, subject to a Capped Value between US$11.00 – US$11.40 (10 – 14% maximum total return).
• Downside: 1-for-1 exposure to any decline in the S&P 500; 100% of principal is at risk.
• Payments: single payment at maturity; no periodic coupons or dividends.
• Initial estimated value: US$9.20 – US$9.70, below the US$10 public offer price, reflecting RBC’s lower internal funding rate, a US$0.175 underwriting discount and a US$0.05 hedging-related charge.
• Liquidity: no exchange listing; RBC, MLPF&S and BofAS are not obligated to make a secondary market.
• Credit risk: all payments depend on RBC’s ability to pay; the notes are not bail-inable and are not FDIC/CDIC insured.

Illustrative payout: if the S&P 500 rises 4%, investors receive the capped US$11.20 (≈12% return); a 20% or 100% rise still yields only US$11.20. A 10% decline yields US$9.00; a 50% decline, US$5.00; index at zero, US$0.

Risk highlights

• Loss of principal possible; no downside buffer.
• Return is capped and may underperform direct equity exposure or conventional bonds.
• Secondary market value likely below issue price due to fees and funding spread.
• Valuation sensitive to RBC credit spreads and market volatility.
• Complex U.S. tax treatment; counsel views note as a prepaid derivative contract but IRS could challenge.

Subscriptions of ≥300,000 units in a single household receive a US$0.05 per unit discount. Minimum purchase: 100 units.

Positive

• 300% participation provides leveraged upside to moderate index gains.
• Short 14-month tenor limits exposure period compared with typical 3-5-year structured notes.
• Not bail-inable; ranks equally with other senior unsecured RBC debt.

Negative

• Full principal at risk with 1-for-1 downside to any S&P 500 decline.
• Return capped at 10-14%, significantly limiting potential upside.
• Initial estimated value (US$9.20-9.70) below offer price, embedding 3-8% negative carry on day one.
• No secondary market obligation, creating liquidity risk and likely wide bid-ask spreads.
• No coupon or dividend exposure, resulting in opportunity cost versus direct equity investment.

Insights

Structured Products Analyst

TL;DR: Leveraged upside but capped, full downside risk and limited liquidity make this a niche tactical trade, credit-linked to RBC.

The ARNs offer 3× participation on modest S&P 500 gains over just 14 months, but investors forfeit dividends and any upside beyond 10-14%. The structure embeds roughly 30 bp of distribution fees and a 50 bp hedging charge, so the initial fair value (US$9.20-9.70) sits 3-8% below the offer price, creating immediate negative carry if sold early. Because the notes are not bail-inable, they rank pari passu with RBC’s senior debt, yet holders assume full credit risk. With no periodic coupons and no downside buffer, the risk/return profile is best suited to investors with a short-term moderately bullish view on U.S. large-caps who can tolerate capital loss and illiquidity.

Risk Analyst

TL;DR: Principal-at-risk note concentrates equity and issuer credit risk; adverse for conservative investors.

From a risk perspective, the instrument combines:

• Equity risk: 100% downside exposure.
• Issuer risk: senior unsecured claim on RBC; no deposit insurance.
• Liquidity risk: no exchange listing; market-making discretionary.

The capped payoff distorts the risk-reward asymmetry: expected return is materially less than direct index ownership given historical volatility. Stress scenarios (e.g., a 20% market drawdown) translate into equal principal loss, while gains above ~4% are surrendered. Investors should view this as a short-dated option position sold at a premium over fair value; the fee load plus funding spread reduces exit values. Overall impact to RBC is immaterial; balance-sheet addition is modest relative to its CAD-denominated funding base.

SEC Form 4

FORM 4

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940

OMB APPROVAL

OMB Number:			3235-0287
Estimated average burden
hours per response:			0.5

Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

Check this box to indicate that a transaction was made pursuant to a contract, instruction or written plan for the purchase or sale of equity securities of the issuer that is intended to satisfy the affirmative defense conditions of Rule 10b5-1(c). See Instruction 10.

1. Name and Address of Reporting Person^*

Kelly Matthew

(Last) (First) (Middle)

5000 WEST 36TH STREET, STE 220

(Street)

MINNEAPOLIS MN 55416

(City) (State) (Zip)

2. Issuer Name and Ticker or Trading Symbol
LENDWAY, INC. [ LDWY ]

5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

X	Director		10% Owner
	Officer (give title below)		Other (specify below)

3. Date of Earliest Transaction (Month/Day/Year)
06/30/2025

4. If Amendment, Date of Original Filed (Month/Day/Year)

6. Individual or Joint/Group Filing (Check Applicable Line)

X	Form filed by One Reporting Person
	Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
			Code	V	Amount	(A) or (D)	Price

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
				Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares
Common Stock Equivalent	(1)	06/30/2025		A		844		(1)	(1)	Common Stock	844	$5.03	7,102	D

Explanation of Responses:

1. Each Common Stock Equivalent is the economic equivalent of one share of Lendway, Inc. common stock. The Common Stock Equivalents were acquired pursuant to the Lendway, Inc. Deferred Compensation Plan for Directors (the "Plan"), whereby Directors may elect to defer receipt of cash fees. The Common Stock Equivalents will be settled (i) in Lendway, Inc. common stock upon a separation from service with the Company or (ii) in cash upon an earlier change in control of the Company.

	/s/ Joyce E Kobilka, Attorney-in-Fact	07/02/2025
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
Note: File three copies of this Form, one of which must be manually signed. If space is insufficient, see Instruction 6 for procedure.
Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB Number.

FAQ

What is the participation rate on Royal Bank of Canada’s Accelerated Return Notes (RY)?

The notes offer a 300% participation rate on any positive S&P 500 performance, subject to the cap.

How high can my return go on these RY Accelerated Return Notes?

Your payoff is capped between US$11.00 and US$11.40 per US$10 unit, a maximum gain of 10–14%, set on pricing date.

Do I risk losing principal with the RY ARNs maturing September 2026?

Yes. If the S&P 500 ends below its starting level, you lose 1% of principal for each 1% decline, up to total loss.

Will these notes pay interest or dividends during the 14-month term?

No. All cash flows occur at maturity; you forgo dividends paid by S&P 500 constituents.

Is there a secondary market for the RY Accelerated Return Notes?

The notes are not exchange-listed, and RBC, MLPF&S or BofAS are not obligated to create liquidity.

Why is the initial estimated value lower than the US$10 offer price?

The difference reflects RBC’s lower internal funding rate, a US$0.175 underwriting discount and a US$0.05 hedging charge.