Beneficient closes $8.75 million primary capital transaction

Beneficient (NASDAQ: BENF) announced it closed an $8.75 million primary capital commitment with Quartus AI Fund LP, a fund managed by New York-based Quartus Capital Partners LLC that invests in growth-stage artificial intelligence and technology ventures.

The transaction was part of Beneficient's GP Primary Commitment Program, which provides primary capital solutions to private investment funds. In exchange for an interest in the fund, Quartus AI Fund LP received approximately $8.75 million in stated value of Beneficient's Resettable Convertible Preferred Stock, which can be converted into the company's Class A common stock.

Following the closing, Beneficient reports an unrealized gain of approximately $1.2 million representing its pro rata interest in the appreciation of the fund's existing asset portfolio. The transaction is expected to increase collateral for the company's ExAlt loan portfolio by approximately $9.77 million of interests in alternative assets and add approximately $9.77 million of tangible book value attributable to stockholders.

"We are pleased to partner with Quartus AI Fund LP and welcome Quartus Capital Partners LLC to our GP Primary Commitment Program," said James Silk, Beneficient interim CEO. "We believe Quartus is an exceptional firm at the forefront of vertical AI investing, and this transaction reflects our continued commitment to closing transactions that drive shareholder value and enhance the value of the collateral backing our ExAlt loan portfolio."

Quartus AI Fund LP currently holds nine portfolio AI investments, eight of which are US-based. The fund has performed in the top quartile of Cambridge Associates Benchmark Indices over the past two years, according to the press release. Other investors in the fund include endowments, foundations, registered investment advisors, multifamily offices and single-family offices.

The transaction requires stockholder approval for the issuance of Class A common stock upon conversion of the preferred stock. Beneficient will file proxy materials with the Securities and Exchange Commission seeking this approval.

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