The Beneficient Company Group Designated as Pilot for

The Beneficient Company Group Designated as Pilot for

News Highlights

New Kansas law aims to spur economic growth in the stateCompany will commit capital and serve as pilot financial institution ahead of wider adoption

DALLAS, May 10, 2021 (News) — The Beneficient Company Group, L.P. (“Ben”), a company serving the growing market of investors seeking liquidity for alternative assets, today announced its role as pilot under a new set of industry regulations enacted within the State of Kansas through the Technology Enabled Fiduciary Financial Institutions (TEFFI) Act. The legislation was signed into law on April 21, 2021 and will go into effect on July 1, 2021. The new law allows for the chartering and creation of trust banks known as TEFFIs, which—in their capacity as fiduciaries—will finance alternative assets held in Kansas trusts and provide qualified custodial and trustee services within the State of Kansas.

The new law directs the Kansas State Banking Commissioner to issue a conditional trust banking charter to Ben on July 1, 2021 to establish a fiduciary financial institution pilot program. Ben has committed to funding the pilot program and will assist the Office of the State Banking Commissioner in promulgating rules, regulations, and standards ahead of wider adoption. The issuance of the charter will assist in Ben’s long-term objective of providing liquidity to alternative asset investors through a regulated trust bank.   

“Alternative asset investing in the U.S. comprises a massive $5.6 trillion industry, and companies seeking to finance alternative assets currently operate under a patchwork of state and federal regulations,” said Brad Heppner, Ben CEO and Chairman. “The new law in Kansas creates a clear, cohesive, and unifying regulatory framework for general partners, sponsors, custodians, and transfer agents to better serve a growing pool of alternative asset investors and managers who finance and manage alternative asset holdings. This legislation is the beginning of a terrific partnership in Kansas between legislators, regulators, and the alternative asset industry, which will benefit a wide range of stakeholders.”

Prior to this legislation being signed into law, there was no single jurisdiction in the U.S. that allowed the alternative asset industry to operate at full efficiency. Regulations in states such as Delaware, Wyoming, and Nevada have enacted certain operating provisions, but all lack specific elements in creating a favorable framework for companies providing liquidity in the alternative assets space. The new law in Kansas addresses this issue and provides a major step change in efforts to modernize the industry and bring simple, rapid, and cost-efficient liquidity solutions and other services to a wider universe of alternative asset investors.

Upon the establishment of Kansas trusts to house alternative assets, TEFFIs will have the ability to provide financing to those trusts. As an added benefit to the State of Kansas, standard cost-effective financing fees will flow directly to funding economic development zones in rural and distressed areas of the state. Companies that establish a presence in Kansas will receive a tax credit in exchange for these financing fees.

“Aside from the sweeping industry benefits, the new law will encourage economic development in towns that have been sidestepped for years when it comes to economic support and community development,” Heppner said. “As long as trusts are established in Kansas to hold alternative assets for investors from across the country and a Kansas TEFFI trust bank provides financing to the trusts, then economic benefits will flow to local communities. As a proud native of Hesston, Kansas, I look forward to Ben playing an active role in ensuring these benefits continue for years to come.”

The legislation—which received unanimous support in the Senate, strong bipartisan support in the House, and endorsement from the Governor and other officials throughout Kansas—is intended to attract the alternative asset management industry to move investment assets to Kansas by filling a regulatory need that has led firms to establish trust operations in multiple jurisdictions, and oftentimes in areas outside of the U.S. In practice, the law incentivizes companies to move their alternative investment assets to Kansas under a business, regulatory, and tax-friendly environment, and only requires a small operational footprint of at least three employees within the state.

The pilot will be conducted over the following six to twelve months once Ben receives its conditional trust banking charter on July 1. Upon completion of the pilot, the framework will be available for wider industry adoption. For more information on the program, please visit http://trustben.com/teffi.

About The Beneficient Company Group, L.P.The Beneficient Company Group, L.P. (“Ben”) provides a unique suite of simple, rapid, and cost-effective liquidity solutions and other financial services for owners of alternative assets. Ben’s liquidity solutions are available for most types of professionally managed alternative asset investments and can be customized to suit individual circumstances. Serving as a principal by using its own balance sheet, Ben operates as a permanent financial institution that helps to remove many of the traditional barriers to liquidity faced by mid-to-high net worth individuals and small-to-mid-sized institutions. For more information, visit www.trustben.com.

Media ContactDave Carlson Brunswick GroupBenMedia@brunswickgroup.com+1 312 800 8120

Legislative ContactRepresentative Stephen OwensKansas State LegislatureStephen.Owens@house.ks.gov+1 785 296 7500

Additional ConsiderationsBen does not offer legal, tax, estate, or investment advisory services. Subject to Qualification. To understand the terms of the securities fully, you should carefully read the entire confidential private placement memorandum before making a decision to acquire Liquidity Bonds.

These materials do not constitute an offer to sell or the solicitation of an offer to buy securities of Ben or any of its affiliates. Any offer or sale of securities shall be made solely to accredited investors and solely pursuant to a definitive confidential private placement memorandum and related documents, including definitive subscription materials. Neither Ben, nor any of its affiliates or representatives, (i) make any express or implied representation or warranty as to the completeness or accuracy of the information contained in these materials, or (ii) shall have any liability resulting from your use of these materials.

These materials contain certain estimates, projections and forward-looking statements that contain substantial risks and uncertainties. The estimates, projections, and forward-looking statements contained herein may or may not be realized, accurate, or complete, and differences between estimated results and those realized may be material. Such estimates, projections, and forward-looking statements reflect various assumptions of Ben’s management concerning the future performance of Ben and its affiliates and are subject to significant business, economic, and competitive uncertainties and contingencies, many of which are beyond their control.

Any securities offered through the Ben ExchangeTrust™ will be offered on a best-efforts basis by Emerson Equity, L.L.C. Member FINRA, SIPC and Managing Broker-Dealer for the issue. The Beneficient Company Group, L.P., and Emerson Equity, L.L.C. are not affiliated entities.

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