Core Viewpoint - The company has entered into an agreement to enhance shareholder value by allowing public company stockholders to participate in liquidation priorities historically reserved for preferred equity holders, which is expected to create tangible book value for public stockholders following the closing of the transactions [9][10][17]. Group 1: Public Stockholder Enhancement Transactions - The agreement includes provisions for public company stockholders to receive preferential treatment in the event of a liquidation of Beneficient Holdings, specifically 10% of the first $100 million distributed and 33.3333% of the net asset value of up to $5 billion of alternative assets added after December 22, 2024 [1][23]. - The tangible book value attributable to public company stockholders is projected to increase to approximately $10 million from $0 as of September 30, 2024, with a market capitalization of $5,077,555 based on the closing price of Class A common stock on December 20, 2024 [1][34]. - The company believes these changes will align the interests of preferred equity holders with public stockholders, particularly in liquidity transactions [10]. Group 2: Transaction Details - The existing limitations on the conversion of Preferred Series A Subclass 1 Unit Accounts held by Beneficient Holdings will be modified, allowing for a conversion of up to $10 million 60 days after closing and additional conversions once the net asset value exceeds $100 million [3]. - Upon closing, the company will amend its compensation policy to clarify the administration of allocations and issuances of Class S Ordinary Units related to certain accounts held by Beneficient Holdings [12]. - A Customer Relations Initiative will allow certain entities controlled by the CEO to forego up to $400 million of equity in Beneficient Holdings for the benefit of existing customers [18]. Group 3: Financial Measures - The tangible book value is defined as total stockholders' equity reduced by goodwill and intangible assets, plus temporary equity, with a reconciliation provided for non-GAAP financial measures [13][33]. - The tangible book value attributable to public company stockholders is expected to be $9,932 million on a pro forma basis, reflecting the anticipated impact of the transactions [14]. Group 4: Closing Conditions - The closing of the Public Stockholder Enhancement Transactions is subject to stockholder approval and regulatory filings, with an expected completion in the first half of 2025 [20].

Core Summary - Beneficient has entered into an agreement with entities controlled by its founder and CEO, Brad Heppner, to enhance shareholder value and drive long-term growth by allowing public company stockholders to share in the liquidation priority historically reserved for preferred equity holders [1] - The agreement is expected to increase the tangible book value attributable to public company stockholders from $0 to approximately $10 million as of September 30, 2024, and the company's market capitalization was $5,077,555 as of December 20, 2024 [2] - The company believes these changes will align the interests of preferred equity holders with public company stockholders, particularly in liquidity transactions, and expects to close additional ExchangeTrust transactions starting in Q1 2025 [2][3] Transaction Details - Public company stockholders will receive preferential treatment in the event of a liquidation, including 10% of the first $100 million distributed and 33.3333% of the net asset value of up to $5 billion of alternative assets added after December 22, 2024 [2] - The company will issue additional Class B common stock to current holders, maintaining their collective voting power at 42.67%, with restrictions on dividends and mandatory redemption at $0.001 per share under certain conditions [6] - The company's compensation policy will be amended to clarify allocations and issuances of Class S Ordinary Units to holders of FLP-1 and FLP-2 accounts, with certain restrictions on conversion rights [9] Financial Impact - The tangible book value attributable to public company stockholders is expected to increase to $9,932,000 pro forma, compared to $0 previously, based on the company's reconciliation of non-GAAP financial measures [15] - The company's market capitalization of Class A and Class B common stock was $5,078,000 as of December 20, 2024 [15] Customer Relations Initiative - Entities controlled by the company's founder and CEO, along with an affiliate, will forego up to $400 million of equity in Beneficient Holdings for the benefit of existing customers, with any unclaimed rights benefiting public company stockholders [4][5] Regulatory and Closing Conditions - The closing of the transactions is subject to approval by the company's stockholders, limited partners of Beneficient Holdings, and regulatory filings, with an expected completion in the first half of 2025 [11]

Core Viewpoint - Beneficient has announced an agreement to acquire Mercantile Bank International Corp for a total purchase price of $1.5 million, which will be paid in approximately 2.1 million shares of Class A common stock and cash [1] Group 1: Acquisition Details - The acquisition is expected to enhance Beneficient's service offerings by providing expanded custody and fee-based services, potentially generating additional cash flow in the near term [2] - The acquisition will allow Beneficient to address the needs of large institutional investors and third-party alternative trading systems, expanding its custody services [3] - The closing of the acquisition is subject to customary conditions, including approval from the Office of the Commissioner of Financial Institutions of Puerto Rico, and is anticipated to be completed in the second quarter of 2025 [5] Group 2: Strategic Objectives - The acquisition aims to democratize the market for illiquid alternative assets by offering higher fee rates for custody services compared to traditional offerings [2] - Beneficient plans to generate custody and depositary receipt issuance fee-based revenue starting in 2025, which will support ongoing operations and core liquidity product offerings [4] - The company is focused on expanding its alternative asset custody fee-based service offerings to third parties and institutional investors [4]

Core Insights - Beneficient (NASDAQ: BENF) is a technology-enabled platform that provides exit opportunities and primary capital solutions for holders of alternative assets through its online platform, AltAccess [1][5] - The company has been invited to present at the Emerging Growth Conference on December 4, 2024, showcasing its services to the investment community [1][2] Company Overview - Beneficient aims to democratize the global alternative asset investment market, targeting mid-to-high net worth individuals, small-to-midsized institutions, and General Partners seeking exit options and value-added services [5] - The company's AltQuote™ tool offers customers a range of potential exit options quickly, while the AltAccess® portal allows secure exploration of opportunities and proposals [5] - Beneficient Fiduciary Financial, L.L.C., a subsidiary of Beneficient, operates under the Technology-Enabled Fiduciary Financial Institution (TEFFI) Act in Kansas and is regulated by the Office of the State Bank Commissioner [6] Conference Details - The Emerging Growth Conference provides a platform for public companies to present new products, services, and major announcements efficiently to a broad audience of investors and analysts [3][4] - The conference is expected to attract tens of thousands of individual and institutional investors, as well as investment advisors [4]

DALLAS, Nov. 26, 2024 (GLOBE NEWSWIRE) -- Beneficient (the “Company”) (Nasdaq: BENF), a technology-enabled platform providing liquidity and related trust and custody services to holders of alternative assets, today announced that it has received notice from The Nasdaq Stock Market LLC ("Nasdaq") that it has regained compliance with the Stockholders’ Equity Requirement under Nasdaq Listing Rule 5550(b)(1) and the Audit Committee Requirement under Nasdaq Listing Rule 5605(c)(2). As a result, the Company’s sec ...

DALLAS, Nov. 22, 2024 (GLOBE NEWSWIRE) -- Beneficient (Nasdaq: BENF) (“Ben” or the “Company”), a technology-enabled financial services holding company announces that its subsidiary Beneficient Company Holdings, L.P. consummated a previously announced transaction pursuant to which approximately $35 million of its preferred equity was redesignated as non-redeemable, resulting in the addition of approximately $35 million of permanent equity on its balance sheet. As a result of the transaction, the Company beli ...

Group 1 - Beneficient appointed Karen J. Wendel as an independent member of its Board of Directors effective November 21, 2024, and she will also serve on several committees including Audit and Enterprise Risk [1][2] - Ms. Wendel is the President and CEO of TrustChains, with extensive experience in banking, technology M&A, cybersecurity, and corporate governance, making her a valuable addition to the board [2][3] - The CEO of Beneficient, Brad Heppner, emphasized the need for board expertise in the digital space, highlighting Ms. Wendel's background in blockchain technology and her experience as CEO of four companies [3] Group 2 - Beneficient aims to democratize the global alternative asset investment market, providing solutions for mid-to-high net worth individuals and small-to-midsized institutions to unlock value in their alternative assets [4] - The company offers tools like AltQuote™ for potential exit options and AltAccess® for secure online exploration of opportunities [4] - Beneficient Fiduciary Financial, a subsidiary, operates under the Technology-Enabled Fiduciary Financial Institution Act in Kansas, ensuring regulatory oversight [4]

DALLAS, Nov. 21, 2024 (GLOBE NEWSWIRE) -- Beneficient (NASDAQ: BENF) (“Ben” or the “Company”), whose subsidiary Beneficient Fiduciary Financial, L.L.C., is a Technology-Enabled Fiduciary Financial Institution (TEFFI) today provided an update to the State of Kansas Joint Committee on Fiduciary Financial Institutions Oversight about its business operations, the digital innovation occurring in the alternative asset industry and related economic development activity for the benefit of Kansas communities under t ...

Financial Performance - Beneficient reported a net income of $12.914 million for the period, with a decrease in accumulated deficit to $(1,450.826) million[143]. - Total revenues for the three months ended September 30, 2024, were $8,561,000, compared to a loss of $42,761,000 in the same period of 2023[166]. - The net income attributable to Beneficient common shareholders was $12,914,000, a recovery from a loss of $371,735,000 in the prior year[166]. - The company reported an operating loss of $13,715,000, an improvement from a loss of $381,764,000 in the same quarter last year[166]. - The net income per common share for Class A was $2.98, recovering from a loss of $115.95 in the previous year[166]. - The net income attributable to common shareholders for the six months ended September 30, 2024, was $60.6 million, a substantial improvement from a loss of $1.5 billion in the prior year[198]. - The company generated net income of $54.1 million for the six months ended September 30, 2024, but has an accumulated deficit of $2.0 billion[211]. Assets and Liabilities - The total equity as of September 30, 2023, was $932.259 million, reflecting a significant change from the previous period[144]. - Total assets as of September 30, 2024, amounted to $368.79 million, a slight increase from $368.50 million on March 31, 2024[165]. - Total liabilities decreased to $256.45 million from $309.57 million[165]. - Accumulated deficit improved to $(1.99) billion from $(2.06) billion[165]. - The company reported a balance of $1,842,534 in total assets as of September 30, 2023, with a significant liability of $(1,450,826)[175]. Cash Flow and Liquidity - Cash and cash equivalents decreased to $4.48 million from $7.91 million[165]. - Cash flows from operating activities showed a net cash used of $19.3 million for the three months ended September 30, 2024, compared to $27.4 million in the same period last year[205]. - The company reported a net cash provided by investing activities of $11.2 million for the three months ended September 30, 2024, down from $25.7 million in the same period last year[205]. - The total cash, cash equivalents, and restricted cash at the end of the period was $4.8 million, an increase from $2.4 million at the end of the same period last year[205]. - As of September 30, 2024, Beneficient reported unrestricted cash and cash equivalents of $4.5 million, down from approximately $3.5 million as of October 31, 2024[211]. Share Issuance and Stockholder Impact - Beneficient's Class A common stock issuance included 211 shares to settle liabilities and 363 shares issued, totaling $673 thousand[143]. - The company may issue additional shares of common or preferred stock without stockholder approval, potentially diluting existing stockholder interests[135]. - The company issued 1,076,462 shares of Class A common stock in connection with the conversion of BCG common units[161]. - Following the de-SPAC merger with Avalon, the company issued 99,649 shares of Class A common stock and 34,961 shares of Series A preferred stock[259]. - The Company executed a reverse stock split at a ratio of 1-for-80 effective April 18, 2024, with proportional adjustments made to equity awards and warrants[217]. Operational Changes and Cost Management - The company implemented an operating cost reduction plan, resulting in the furlough of approximately 30 employees, representing about 20% of its workforce as of July 11, 2023[187]. - An additional layoff of 15 employees, representing approximately 10% of the workforce, was approved effective November 3, 2023[187]. - The company has plans to further reduce spending with third-party vendors as part of its cost reduction strategy[187]. - Employee compensation and benefits amounted to $7,135,000, down from $15,398,000 year-over-year[166]. Regulatory and Compliance Risks - Beneficient's operations are subject to comprehensive governmental regulation, which may lead to fines or penalties for violations[135]. - There is substantial doubt about the company's ability to continue as a going concern, although financial statements are prepared on a going concern basis[157]. - The company faces repayment risks related to its liquidity transactions, which could impact financial stability[135]. - Beneficient's future performance may be adversely affected by changes in economic and market conditions[135]. Investment and Growth Strategies - The company plans to invest in new product initiatives and growth strategies, including potential acquisitions[156]. - The company plans to expand its product offerings through Ben Insurance Services and Ben Markets, focusing on customized insurance products and broker-dealer services[181]. - The company generated interest and fee income from ExAlt Loans, which are collateralized by cash flows from exchanged alternative assets[181]. Impairment and Fair Value Adjustments - The balance of goodwill and intangible assets may require future write-downs due to impairment risks[135]. - The company recognized a loss on impairment of goodwill amounting to $3.7 million for the three months ended September 30, 2024, compared to a loss of $1.4 billion in the same period last year[205]. - The company performed an interim impairment assessment due to a significant decline in Class A common stock price, leading to a goodwill impairment charge of $3.7 million for the six months ended September 30, 2024, compared to $1.4 billion for the same period in 2023[308]. Financial Instruments and Valuation - The company recognized a net loss of $224,000 in the change in fair value of financial instruments for the three months ended September 30, 2024[251]. - The fair value of equity interests in the GWG Wind Down Trust was nominal at $0.6 million as of September 30, 2024, following the reorganization plan effective August 1, 2023[244]. - The fair value of the contingent interest feature derivative liability resulted in a net gain of $0.2 million and $1.6 million for the three and six months ended September 30, 2023, respectively[286]. - The fair value of the Convertible Debenture was $1.9 million, with an aggregate loss of $1.7 million recognized during the three and six months ended September 30, 2024[288].

Core Insights - Beneficient reported its second consecutive profitable quarter as a public company, indicating a strong position in the liquidity and primary capital market for private investments [2][3] - The company has authorized up to $5 billion in fiduciary financings to Customer ExAlt Trusts, aiming for substantial growth as new opportunities arise [2] - Beneficient's balance sheet was strengthened by redesignating approximately $125.5 million of preferred equity to permanent equity, improving its financial stability [3] Financial Performance - Investments with a fair value increased to $335.0 million from $329.1 million at the end of the previous fiscal year, supporting a net loan portfolio of $260.7 million [3][16] - Revenues for the second quarter of fiscal 2025 rose to $8.6 million, a significant recovery from a loss of $42.8 million in the same quarter of fiscal 2024 [3][20] - Operating expenses decreased to $22.3 million in the second quarter of fiscal 2025, down from $339.0 million in the same quarter of fiscal 2024, reflecting improved cost management [3][20] Business Segments - Ben Liquidity segment recognized $12.0 million in interest income for the fiscal second quarter, a 10.4% increase from the previous quarter, with operating income improving to $2.9 million [10][13] - Ben Custody segment reported revenues of $5.4 million for the fiscal second quarter, stable compared to the previous quarter, with operating income increasing to $4.3 million [12][14] - Total segment revenues attributable to Ben's equity holders were $16.6 million for the fiscal second quarter, a 2.4% increase compared to the prior quarter [26] Capital and Liquidity - As of September 30, 2024, the company had cash and cash equivalents of $4.5 million and total debt of $124.1 million [15] - Distributions received from alternative assets and other securities held in custody totaled $12.5 million for the six months ended September 30, 2024, down from $26.3 million in the same period of fiscal 2024 [16] Portfolio Diversification - The loan portfolio is supported by a diversified alternative asset collateral portfolio, including approximately 240 private market funds and around 800 investments across various sectors and geographies [6][8] - The portfolio includes exposure to notable private companies in sectors such as space exploration, clean energy, and technology [6]