Beneficient (BENF) Review 2026: Debt, Dilution, Heppner, Nasdaq
Some links pay us a referral fee; each one says so. Disclosure
Quick Answer
Beneficient (Nasdaq: BENF) is still listed and still filing, but on its own numbers it is a stressed company: at June 30, 2026 it reported total liabilities of $344.5 million against total assets of $250.9 million, a total equity deficit of $184.1 million, $5.6 million of cash ($3.4 million by July 31, 2026), and “substantial doubt” about its ability to continue as a going concern. It provides liquidity to holders of illiquid private-fund (LP) interests by lending to its own “Customer ExAlt Trusts”, which take the interest and pay the seller. In each of its three 2026 deals the seller was paid in Series B convertible preferred stock, not cash: one January 2026 seller who handed over a $3.02 million fund interest holds preferred convertible into at most 565,007 shares, worth about $0.81 million at the $1.43 price of October 5, 2026 (our arithmetic). Its ExAlt loan book of $584.1 million carries a $414.4 million loss allowance (March 31, 2026). The share count has been cut 640-for-1 by two reverse splits and is growing again: 18,957,701 Class A shares at September 24, 2026, with a vote on October 29, 2026 that could let Yorkville receive up to about 69.9 million more. Founder Brad Heppner was convicted on May 7, 2026 and is set to be sentenced on October 21, 2026; on September 23, 2026 Beneficient said it wants to cancel about $130 million of HCLP debt it calls fraudulent and swap his preferred equity (about $850 million of liquidation preference) for 162,132 shares. No definitive agreement exists as of October 10, 2026.
Key Takeaways
- What it sells: Ben Liquidity makes 12-year ExAlt Loans to trusts that buy a customer's LP interest. Loans made from December 31, 2020 float off a 10% base rate or carry a fixed 5%-10% (14% base before that), and the 10-K says interest plus amortized fees are expected to bring in about 7% to 14% of each loan's balance a year. Fees are not billed to the seller: they are “embedded into the pricing”.
- What sellers got in 2026: three primary capital deals (fund interests with NAVs of $3,022,728, $8.75 million and $7.44 million) were paid in Series B-9, B-10 and B-11 resettable convertible preferred. Each share converts at $10.00 divided by a price that resets monthly but cannot fall below a floor ($5.3499, $1.2418 and $1.8257). The preferred ranks equally with Class A common, has no vote and gets dividends only if common does.
- The loan book: $584.1 million gross (including $289.3 million of unamortized discounts) less a $414.4 million allowance leaves $169.7 million net at March 31, 2026, against collateral with a NAV of $162.8 million across 140 funds and 397 investments, with vintages from 1993 to 2025.
- Results: a net loss of $164.7 million for the year to March 31, 2026 ($87.4 million attributable to common shareholders), then a $6.8 million loss to common in the quarter to June 30, 2026.
- Ownership: HH-BDH, the Hicks Holdings vehicle, holds 11,710,609 Class A shares, 61.8% of the class; Brad Heppner still holds 27,687 Class B shares (92.6% of that class). On September 15, 2026 the CEO and two directors bought 33,019 shares at $1.06 (our sum).
- Nasdaq: a string of deficiency notices in 2024-2025 (bid price, late filings, stockholders' equity, audit committee). It regained compliance through the $35 million market-value-of-listed-securities alternative on October 29, 2025 and on bid price on January 2, 2026. At $1.43, the 18,957,701 Class A shares were worth about $27.1 million (our arithmetic).
- Litigation: a Texas arbitration award to a former director of a Beneficient entity, about $69.7 million with 10.5% interest, confirmed on appeal and now before the Supreme Court of Texas; a Delaware Court of Chancery suit by Paul Capital Advisors with stated maximum exposure of up to $350 million; and dueling Nevada and Delaware suits over Heppner's $3.8 million defense-cost demand.
CSV · 132 rows
Beneficient (BENF): business terms, ExAlt loan book, balance sheet, 2026 liquidity deals paid in preferred stock, share count and dilution, Nasdaq notices, litigation and the HCLP/Heppner plan
132 rows from Beneficient's 10-K (fiscal year ended March 31, 2026), 10-Q (June 30, 2026), 15 Form 8-Ks and exhibits from July 2025 to September 2026, the preliminary proxy of October 7, 2026, and three Department of Justice pages on the Heppner case.
What Beneficient does, in its own 10-K
Beneficient describes itself as a company that “provides simple, rapid, and cost-effective liquidity solutions” to people holding private-fund interests they cannot easily sell. The mechanism is unusual, and it explains almost every number further down this page. When you sell an LP interest to Beneficient, you do not sell it to Beneficient: a set of Customer ExAlt Trusts (beneficially owned by charities in Kansas, or Texas for older deals) takes the interest, and a Beneficient subsidiary lends those trusts the money, or the securities, used to pay you. Beneficient then earns interest and fees from the trusts, and the fund's future distributions repay the loan.
| Term | What the 10-K says (fiscal year ended March 31, 2026) |
|---|---|
| Loan maturity | 12 years |
| Interest | Variable off a 10% base rate, or fixed 5%-10%, for loans from December 31, 2020; 14% base before that; interest compounds monthly and is capitalized |
| Total expected take | About 7% to 14% of each loan's balance a year, interest plus amortized transaction and trust administration fees |
| Custody fee | Annual fee on the NAV plus the unfunded commitment of the exchanged asset, payable quarterly |
| Charity share | 2.5% of all distributions on deals from December 7, 2021; 5.0% of loan payments on older deals |
| Fees paid by the seller | None out of pocket: fees are built into the price offered |
| Ways to be paid | Ben ExchangeTrust: Beneficient equity or debt securities. Ben InterchangeTrust: a mix of cash and securities. Ben LiquidTrust: cash from the balance sheet |
| Regulator | Kansas Office of the State Bank Commissioner, for the trust company chartered under the state's TEFFI Act |
Source: Beneficient Form 10-K for the fiscal year ended March 31, 2026, Item 1 and MD&A. The 10-K does not publish the percentage fee schedule.
Two consequences matter for a seller. First, because the fees are “embedded into the pricing offered for the exchange of the alternative asset”, you never see an invoice: the cost shows up as a lower price, or as a security worth less than the NAV you gave up. Second, because the loans and fees run between Beneficient's own subsidiaries and trusts it consolidates, they disappear from the consolidated income statement. What remains visible is the value of the funds the trusts hold.
What a seller was actually paid in 2026
The 8-Ks Beneficient filed for its three 2026 transactions show what the customer received. None got cash.
| Deal (8-K) | NAV of LP interest handed over | Paid with | Initial conversion price / floor | Max Class A shares | Worth at $1.43 (our arithmetic) |
|---|---|---|---|---|---|
| January 5, 2026 (Series B-9) | $3,022,728 | 302,273 preferred shares | $7.1332 / $5.3499 | 565,007 | About $0.81 million, 26.7% of NAV (floor reached) |
| April 8, 2026 (Series B-10) | $8.75 million | 875,214 preferred shares | $3.5479 / $1.2418 | 7,047,947 | Close to NAV while the monthly reset stays above the floor |
| July 10, 2026 (Series B-11) | $7.44 million | 744,455 preferred shares | $3.6514 / $1.8257 | 4,077,642 | About $5.83 million, 78.4% of NAV (floor reached) |
Sources: Beneficient 8-Ks of January 8, April 10 and July 13, 2026. The $1.43 is the October 5, 2026 closing price quoted in the October 7, 2026 proxy. Values are the maximum shares times $1.43; they ignore trading discounts and lock-ups.
How the paper works: each preferred share converts into $10.00 divided by the conversion price, and that price resets every month to the five-day average stock price, but never below the floor and never above the starting price. If the stock stays above the floor, the seller keeps roughly the dollar value agreed. Once it falls below the floor, the share count stops growing and the seller absorbs the decline. For the January 2026 seller, the floor of $5.3499 was far above the October price, so the $3.02 million fund interest became preferred convertible into stock worth about a quarter of that (our arithmetic). The preferred ranks “pari passu to the Class A Common Stock”, has no vote except as required by law, pays dividends only on an as-converted basis if common does, and converts automatically around the fifth anniversary if conditions are met.
The deals helped Beneficient: after the April 2026 deal it said it “participates in an unrealized gain of approximately $1.2 million”. Its shareholder letter put the fiscal 2026 total of these GP Primary Commitment transactions at about $14.9 million of NAV.
The balance sheet behind the stock
| Item | June 30, 2026 | March 31, 2026 | Source |
|---|---|---|---|
| Cash and cash equivalents | $5.6 million ($3.4 million at July 31) | $2.5 million | 10-Q |
| Investments held by Customer ExAlt Trusts | $212.5 million | $195.5 million | 10-Q |
| Total assets | $250.9 million | $238.8 million | 10-Q |
| Debt due to related parties | $96.8 million | $96.8 million | 10-Q |
| Total liabilities | $344.5 million | $337.5 million | 10-Q |
| Temporary equity (redeemable preferred units) | $90.5 million | $90.5 million | 10-Q |
| Total equity (deficit) | -$184.1 million | -$189.3 million (-$34.9 million a year earlier) | 10-Q; 10-K |
| Accumulated deficit | $2.1 billion | 10-Q | |
| Net loss to common shareholders | $6.8 million (quarter) | $87.4 million (fiscal year); net loss $164.7 million | 10-Q; earnings release |
Liabilities exceeded assets by about $93.6 million at June 30, 2026 (our arithmetic). The loan book tells the same story from the inside. At March 31, 2026 the ExAlt Loans had a gross balance of $584.1 million, including $289.3 million of unamortized discounts, and an allowance for credit losses of $414.4 million, about 71% of the gross balance (our arithmetic), up from $342.5 million a year earlier. Net of the allowance the loans were carried at $169.7 million, backed by fund interests with a NAV of $162.8 million (down from $259.1 million), and the company's own loan-to-value ratio was 0.91. Part of that decline is deliberate: Beneficient sold fund interests for $51.5 million of gross proceeds during the fiscal year to pay down debt and fund operations.
The going-concern paragraph, verbatim
The 10-Q for the quarter ended June 30, 2026 lists the reasons, including “our current inability to raise sufficient capital, recurring losses from operations, negative cash flows from operations, existing events of defaults on our related party debts”, and the arbitration award. Its conclusion: “All of these conditions raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date of issuance.” The company says it expects to cover the gap by issuing debt or equity, including to Yorkville, and by selling assets held by the trusts.
Shares, splits and who owns the company
| Date | Event | Class A shares |
|---|---|---|
| June 8, 2023 | Begins trading on Nasdaq after merging with Avalon, a SPAC | |
| April 18, 2024 | 80-for-1 reverse split | |
| October 15, 2025 | Pre-listing holders convert $52.6 million of subsidiary preferred units into Class A (the “Limited Conversion”), locked up to October 1, 2028 | 12,661,786 issued; 13,844,818 outstanding |
| December 15, 2025 | 8-for-1 reverse split | |
| June 30, 2026 | Quarter end | About 14.8 million |
| August 7, 2026 | 10-Q cover | 15,425,814 |
| September 24, 2026 | Proxy record date, after 2,902,240 shares issued to Yorkville since June 26 | 18,957,701 |
The two splits combine to 640-for-1 (our arithmetic): 640 shares bought before April 2024 are one share today. Control sits with one holder. HH-BDH, LLC, whose sole member is Hicks Holdings and whose managing member, Mack Hicks, joined the board in March 2026, owns 11,710,609 Class A shares, 61.8% of the class. HH-BDH was also Beneficient's lender: the company repaid about $27.5 million of principal on January 12, 2026 and settled the remaining $1.66 million of interest and fees with 149,904 shares and cash.
The next step is more stock. Under an amended standby equity purchase agreement of June 26, 2026, Beneficient can sell Yorkville up to $100.0 million of Class A shares and borrowed $4.0 million in convertible notes, issued with a 5% original issue discount and convertible at 92.0% of the lowest daily price of the previous five trading days, with a $0.89 floor. The special meeting on October 29, 2026 asks shareholders to lift Nasdaq's 20% cap on those issuances. The proxy's own example: at $1.43, “up to approximately 69,930,069 shares” could be issued, about 3.7 times the shares outstanding on the record date (our arithmetic). With HH-BDH alone holding 61.8%, approval looks likely if it votes in favor (our reading).
Nasdaq: the notices, the cures and a thin margin
| Date | Nasdaq event (8-K Item 3.01 or 10-K) | Status |
|---|---|---|
| July 16, 2024 | Stockholders' equity below the $2.5 million minimum | Cured November 2024 with a share sale to Yorkville and a redesignation |
| July 16, 2025 | Delisting determination: bid price under $1.00 since January 2025 | Hearing before the Panel on August 26, 2025 |
| August 18, 2025 | Late Form 10-Q (on top of the late 10-K) | Cured October 29, 2025 |
| October 3, 2025 | Stockholders' equity of -$34,925,000 | Cured October 29, 2025 under the $35 million market-value-of-listed-securities alternative |
| January 2, 2026 | Bid price compliance regained after the 8-for-1 split | In compliance; no new Item 3.01 8-K filed since October 9, 2025 |
Beneficient met the equity rule through the market-value alternative, not with positive equity, which it does not have. That alternative is a $35 million floor. At the $1.43 close on October 5, 2026, the 18,957,701 Class A shares were worth about $27.1 million (our arithmetic), and the price paid by insiders in September was $1.06. The 10-K warns that there “can be no assurance” it will keep meeting that standard. Nothing filed as of October 10, 2026 says Nasdaq has sent a new notice, but this is the line to watch in the next 8-Ks.
Heppner, HCLP and the September 2026 plan
The link to GWG Holdings runs through HCLP. The Department of Justice's indictment alleged that Heppner “created a $141 million debt that Beneficient purportedly owed to HCLP”, a shell company he controlled, and that “Beneficient received at least approximately $300 million from GWG”. On May 7, 2026 a jury in the Southern District of New York convicted him of securities fraud, wire fraud, conspiracy and false statements to auditors “in connection with a scheme to fraudulently extract more than $150 million from GWG.” The DOJ case page, updated September 11, 2026, says sentencing has been moved to October 21, 2026. Our GWG Holdings page follows what that means for former L bond holders.
For Beneficient the HCLP loan is still on the books: about $94.3 million of debt plus $32.2 million of unpaid interest at June 30, 2026. HCLP says the loan matured on April 14, 2025 and sent default notices on July 30, 2025. Beneficient says it is evaluating the validity of the debt given what it calls credible evidence that Heppner fabricated documents about HCLP.
On September 23, 2026 Beneficient announced a strategy to separate from him entirely. It proposes, as part of a consensual resolution it hopes to reach before sentencing:
| Proposed step | Amount |
|---|---|
| Cancel the contested HCLP debt | About $130 million of principal and accrued interest |
| Exchange all Heppner-related equity, including subsidiary preferred with a liquidation preference of about $850 million | 162,132 Class A shares in total |
| Void other agreements with Heppner entities and extinguish amounts claimed under them | About $88 million |
| End his Class B shares and their super-voting, board and consent rights | 27,687 Class B shares, 92.6% of the class |
Beneficient says that if this is completed it “would eliminate substantially all of the Company’s debt.” It is a proposal: the company states it “has not entered into a definitive agreement”, and that it will sue if no deal is reached. At $1.43, the 162,132 shares would be worth about $232,000 (our arithmetic), against claims the company itself puts at hundreds of millions. Separately, any recovery either side wins from Heppner goes to the GWG Litigation Trust under an amended agreement filed June 15, 2026, so this plan cleans up Beneficient's balance sheet but is not a source of cash for it.
Litigation the filings disclose
| Matter | Court | Status as of the June 30, 2026 10-Q | Stake |
|---|---|---|---|
| Arbitration over terminated equity awards, brought by a former director of Beneficient Management | ICC arbitration; Dallas County 134th District Court; Texas Fifth Court of Appeals; Supreme Court of Texas | $55.3 million awarded April 2024; vacated July 29, 2024; reinstated October 10, 2025; rehearing denied May 13, 2026; petition to the Supreme Court of Texas filed June 4, 2026 | About $69.7 million with interest at 10.5%; a $25 million bond was ordered, and the company posted a $100 cash bond after declaring negative net worth |
| Paul Capital Advisors v. Beneficient and others (filed February 18, 2022) | Delaware Court of Chancery | Bifurcated; standing discovery ordered June 24, 2024 | Company states maximum exposure “could be up to $ 350 million plus costs and expenses” |
| Heppner's demand for $3.8 million of criminal defense costs | Clark County, Nevada (company's suit, May 28, 2026); Delaware Chancery (Heppner's suit, June 5, 2026) | Pending | Advancement and indemnification |
| GWG Litigation Trust claims | Bankruptcy Court, Southern District of Texas | Dismissed with prejudice as to Beneficient on February 13, 2026; settled with no payment by the company | Closed for Beneficient; indemnity claims by others possible |
| SEC investigation | SEC Division of Enforcement | Wells notice June 29, 2023; termination letters July 1, 2024 | No enforcement action recommended |
The Texas award is the one that moves cash. The 10-Q says the company is exploring a settlement “that could reduce the potential near term cash obligations”, and its cash on July 31, 2026 was $3.4 million.
If you hold an illiquid LP interest: what to compare Beneficient with
Beneficient's pitch is to people who cannot easily exit a private fund. Before you use it, line it up against the other exits:
| Exit | What you get | Who sets the price | What to check |
|---|---|---|---|
| Secondary sale to a buyer (direct or through a broker or auction) | Cash, usually at a discount to NAV | Buyer's bid, competed if several buyers look | GP consent and right of first refusal; closing time; whether the price is quoted on the latest NAV |
| Fund tender offer or repurchase program (interval funds, non-traded REITs and BDCs) | Cash at or near NAV | The fund's formula | Proration: in a crowded window you may sell only part of what you tender |
| Beneficient ExAlt Plan (2026 practice) | Convertible preferred of a company with a going-concern warning | Beneficient, with fees embedded | The floor price versus today's stock price; lock-ups; what the shares could fetch if many holders convert |
| Hold to the end of the fund | Distributions as the fund sells its companies | The market, over years | Remaining fund term, unfunded commitments, your need for cash |
The test we would apply (our reading): convert any offer into dollars you could have in hand within a year. Cash at a discount from a secondary buyer is a known number. Preferred stock in Beneficient is a bet on BENF, a stock that needed two reverse splits to stay listed and is about to be diluted, and its floor protects you only until the price passes below it, as the January 2026 seller found. For how fund-run exits behave in practice, see how the VCMIX secondary auction worked for a fund whose repurchase offers were oversubscribed, and our guides to non-traded REIT tender offers and liquidity on real estate crowdfunding platforms.
Our read
Beneficient's filings are candid about its problems, and 2026 brought real changes: Heppner is out and convicted, the GWG suits against the company ended without a payment by it, the HH-BDH loan was repaid, and a plan exists to cancel the HCLP debt. But the core facts as of October 10, 2026 are a $184.1 million equity deficit, a going-concern warning, a loan book reserved at about 71%, a $69.7 million award it is still appealing, $3.4 million of cash at July 31, and an equity line whose cost is paid in new shares. For a holder of an LP interest, the question is not whether Beneficient is a fraud (its founder was convicted; the current company is not charged with anything) but whether being paid in its stock beats a cash bid. In the three 2026 deals, the seller who took the most stock-price risk has kept about a quarter of the fund's NAV so far (our arithmetic).
What a holder or seller can do with this
- If you have been offered an ExAlt Plan deal: ask whether you will be paid in cash (LiquidTrust) or securities; get the floor price, the maximum share count and any lock-up in writing; and compare against at least one cash bid for the same interest.
- If you received Series B preferred: your 8-K lists your floor. Below it, every 10 cents off the stock price costs you 10 cents per conversion share.
- If you own BENF shares: the next filings to read are the special meeting result (October 29, 2026), any 8-K after the October 21, 2026 sentencing, and the 10-Q for the quarter ending September 30, 2026.
- If you are a former GWG L bond holder: BENF's price no longer affects your recovery; the GWG Holdings page explains why.
FAQ
Filing alert · free
An email when Beneficient files with the SEC
When Beneficient files: what changed, the one number that matters, and the accession number to check it yourself.
Sources, read on October 10, 2026: Beneficient filings on SEC EDGAR (CIK 1775734): Form 10-K for the fiscal year ended March 31, 2026 (accession 0001775734-26-000018); Form 10-Q for the quarter ended June 30, 2026 (0001775734-26-000030); Form 8-Ks of July 18, 2025 (0001641172-25-020277), August 22, 2025 (0001641172-25-025249), October 9, 2025 (0001493152-25-017597), January 8, 2026 (0001493152-26-000893), March 12, 2026 (0001493152-26-009772), April 10, 2026 (0001493152-26-016035), June 25, 2026 (0001493152-26-030173), June 29, 2026 with the earnings release and shareholder letter (0001775734-26-000013), July 7, 2026 (0001493152-26-032323), July 13, 2026 (0001493152-26-033069), August 11, 2026 (0001493152-26-037138), September 16, 2026 (0001493152-26-042821) and September 23, 2026 with Exhibit 99.1 (0001493152-26-043806); and the preliminary proxy statement of October 7, 2026 (0001493152-26-046151). U.S. Attorney's Office for the Southern District of New York: press releases of November 4, 2025 and May 7, 2026 and the case page for United States v. Heppner, 25 Cr. 503 (read October 10, 2026). Values of preferred stock at $1.43, the combined split ratio, ratios and differences are our arithmetic. This is analysis of public documents, not investment, legal or tax advice.
Keep reading.
- 0127 min read
Asset Preservation Inc Review 2026: Stewart Filings and Safety
Asset Preservation, Inc. (API), the Roseville, California 1031 qualified intermediary, belongs to Stewart Information Services. Stewart's 10-Ks report its exchange-fund liability year by year: $1.19 billion in 2006, $167.9 million in 2010, $2.5 billion in 2021, $1.2 billion in 2025. In 2008 API's exchange account held $355.0 million of auction rate securities; API borrowed $241.5 million, guaranteed by Stewart, to buy them out at par. What the filings show, and what API's website claims that no filing can confirm.
- 0229 min read
DLP Capital Review 2026: 19 SEC Filers, $1.85B Sold, One Bank
DLP Capital's company-level record as of October 10, 2026: 19 DLP-affiliated issuers on SEC EDGAR, 21 Form D offerings reporting $1,854,231,382 sold (our sum), no sales commissions on any fund, no registered investment adviser since February 28, 2019, the only audited DLP fund statements in public (73.0% related-party loans at end of 2021), DLP Bank's FDIC numbers, the 2021 bank deal that fell through, the redemption terms in the DLP Access Fund N-2, and what the court record says about the lawsuit and misconduct claims in search results.
- 0319 min read
Express Capital Financing Reviews 2026: Who Holds Its Loans
Express Capital Financing is a Brooklyn private lender to real estate investors (trading name of Express Capital Holdings, LLC). New York City property records show 148 mortgages and $72.1 million since 2021, 47 sharing a lot with a recorded assignment out, six of them to Constructive Loans. It has no HMDA, CFPB or SEC record under the name. Its own terms, read October 10, 2026.