Beneficient issues $2M convertible note to Yorkville, grossing $1.8M

What happened

Beneficient (ticker: BENF), a Dallas-based financial services company, disclosed in a Form 8-K filed August 11, 2026 that it issued a second promissory note to YA II PN, Ltd. (Yorkville) on August 5, 2026.

The note has an aggregate principal amount of $2.0 million, subject to a 5% original issue discount, resulting in gross proceeds of approximately $1.8 million, which the company received the same day.

This follows a first note of $2.0 million issued on June 30, 2026 under the same arrangement, which grossed approximately $1.8 million and was received on July 1, 2026.

The notes are part of an amended and restated Standby Equity Purchase Agreement (A&R SEPA) entered into on June 26, 2026, which allows Beneficient to sell up to $100.0 million of Class A common stock to Yorkville and includes the issuance of these convertible notes.

The stock closed at $2.26 on the event date, down 4.24% from the prior close of $2.36, according to price data.

Terms of the notes

Each promissory note matures on June 30, 2027 and bears interest at 5.0% per annum, increasing to 18.0% per annum upon an uncured Event of Default.

The notes are convertible into Class A common stock at the holder's option. The conversion price is the lower of $5.6064 (150% of the VWAP on the trading day before the first closing) or 92% of the lowest daily VWAP during the five trading days prior to conversion, subject to a floor price of $0.89 per share (which the company can reduce).

A conversion cap limits the number of shares issuable. Assuming 5% interest through maturity, the maximum number of shares issuable is 4,719,101. Conversion is also limited so that Yorkville cannot beneficially own more than 4.99% of the Class A common stock after any conversion.

The filing states that the material terms of the A&R SEPA and the notes were previously described in the company's Annual Report on Form 10-K filed June 30, 2026.

What this means

A Form 8-K is a current report that companies file with the SEC to announce significant events. Item 2.03 specifically requires disclosure when a company takes on a direct financial obligation, such as issuing debt.

A promissory note is a written promise to repay a borrowed amount, here convertible into shares instead of being repaid in cash. The original issue discount means the company received less than the face value—$1.8 million on a $2.0 million note—reflecting the cost of the financing.

The conversion price structure is variable: it decreases as the stock price falls, which is typical for convertible notes from investors like Yorkville. This means the lower the stock price, the more shares Yorkville gets upon conversion, potentially diluting existing shareholders.

The company now has a direct obligation to repay $4.0 million in total principal (two notes of $2.0 million each) by June 30, 2027, unless converted into stock beforehand. The filing does not state how Beneficient plans to use these funds.

This is a financing event, not a routine housekeeping matter. It reflects the company's ongoing use of convertible debt arrangements with Yorkville.