Beneficient · NASDAQ:BENF
Beneficient — Avalon Acquisition — SPAC Merger (January 2023)
46 slides from Beneficient's SPAC merger presentation, Jan 10, 2023
Slide 1: Analyst Day Presentation
7 Analyst Day Presentation January 10, 2023 . Nasdaq MarketSite POP eRe ee moe e eee sere eee eeeeeeeeEseeese Cee e meee meee eee e ee ee eres eeeeseeeseesesesesesesseseesessssssseses
Slide 2: Important Risks and Disclaimers
Important Risks and Disclaimers This presentation is for educational and informational purposes only This presentation has been prepared for use by The Beneficient Company Group, LP. ("Ben") and Avalon Acquisition Inc. ("Avalon") in connection with their proposed business combi LUCentered into a Bus
Slide 3: Today's Speakers
Today’s Speakers A id K. Heppner James G. Silk Derek L. Fletcher Executive Chairman Chief Executive Officer Executive Vice President & esident & & Chairman Chief Legal Officer Chief rlduesaty Officer AVALON © ‘Acquisition Inc. > Ben Ben ~) Ben Maria S. Rutledge ir. Sam Hikspoors Scott Wilson Gregory
Slide 4: Today's Agenda
Today’s Agenda Time Topic Speakers 10:00 AM I welcome ane * Don Putnam, i i Avalon A : ntroi us an ‘o Ben * Brad K. Heppner, Chief Executive Officer & Chairman, ae some Distribution, ¢ Jeff Welday, Global Head of Originati & Distribution aaa * Derek L. Fletcher, President & Chief Fiduciary Offi Revi
Slide 5: Introduction to Beneficient
Slide 6: Avalon's Search Focused on Companies that Met Specific Criteria
Avalon’s Search Focused on Companies that Met Specific Criteria Financial Services with Financial Results v an whi, Id I expertise, including financial fi technology and insurance p sub-scale companies vi ) A n Talented & Incentivized Management Team growth and v \ 1 profitability arn . . Y Desi b b
Slide 7: Key Investment Highlights
Key Investment Highlights Significant Market + Ben esti i : andi . Opportunity _ - Sized Institutions (SMT) Strong Team . * — Simple, rapid, Innovative, Disruptive to customers in as few as 30 days Business Model . MultipleCompetitive =| Advantages * Unique platform, fortifi i 1. Source: Pregin, all
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Slide 9: The Journey of Transforming an Asset Class
The Journey of Transforming an Asset Class The alternative asset class is at the precipice of being digitized and democratized as other asset classes have been e (e.g., equities, mortgages, etc Standardization of assets through Technology-Driven and sound process Strategy Statutory Custody Trust Sta
Slide 10: What Problem is Ben Solving for Alternative Asset Investors?
What Problem is Ben Solving for Alternative Asset Investors? Ben provides liquidity solutions for underserved investor segments, who hold illiquid, professionally managed alternative investments Global alternative Mid-to-ultra high assets under net worth and management smaller institutional growing
Slide 11: Ben's Regulated and Technology-Driven Ecosystem
Ben’s Regulated and Technology-Driven Ecosystem Ben’s ecosystem seeks to digiti d t class Overview of Ben’s Integrated, Data-Rich Ecosystem Digitizing” assets on plat s orm decreases tion costs o' transferring assets to ExAlt Trusts AltCustody™ Y AltQuote™? AltData™? Future Products & i custody, dat
Slide 12: Trailblazing the Path to Democratization of Alternative Assets
Trailblazing the Path to Democratization of Alternative Assets t investors into alt ti Ben gets them out _ ~) Ben Comprehensive & Transparent |Quick Quote on High growth, FinTech ..while Ben’s liquidity Digitized Solution Global alternative isruptors have solutions are management proliferated and de
Slide 13: Alternative Assets and Associated Liquidity Represent a Large Market Opportunity
Alternative Assets and Associated Liquidity Represent a Large Market Opportunity Recent period of rapid growth in alternative investments has resulted in increased demand for early ‘aulalty, currently most are pri ion. AUM (SB) 12,000 9,000 6,000 Secondary volume growth 3,000 S correlation to Alt gr
Slide 14: Translation from Market Opportunity to Ben's Serviceable Market
Translation from Market Opportunity to Ben’s Serviceable Market Ben’s revenue capture is illustrative and intended to contextualize the key components of monetization , Secular Addi Illustrative Revenue Funnel 0 Ben’s Model $11.9" Trillion Alternatives Market ~$2 Trillion? Total $s i Ben’s Market Sh
Slide 15: Competitive Advantages That Set Ben Apart
Competitive Advantages That Set Ben Apart A unique platform fortified by a strong underlying structure Anticipated Public Statutory istin, Technology & Regulatory Technology Vv N) Leadership Anticipated Public to grow at scale ane the RIA and financial advisory market g <> Y Provi Statutory awe y a
Slide 16: Strong Management Team
Strong Management Team Brad K. Heppner IRECTOR, CEO AND CHAIRMAN OF THE BOARD 30+ years dus experience in finance and the alternative asset space MacArthu Foundatio TeCrmmab Gore man eAIN & COMPANY © s James G. Silk EXECUTIVE VICE PRESIDENT & CHIEF LEGALOFFICER 20+ years industry experience in inves
Slide 17: Experienced Board of Directors
Experienced Board of Directors rad K. Heppner R, CEO AND CHAIRMY DIRECTO! years alternative asset and financi 1AN OF Th stitutions experience, Chairman of the Board and CEO, pro Founder and bot The Crossroads Group; Founder of Capital Analytics; previously with Bain & Company, MacArthur Foundation a
Slide 18: Review of Ben's Integrated Platform
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Slide 19: Breadth and Depth of Solutions for Almost All Asset Types and Asset Vehicles
Breadth and Depth of Solutions for Almost All Asset Types and Asset Vehicles — Near Ubiquitous Relevance Provides a modernized digital method of delivering liquidity to investors in most alt ti ts, including: Other Professionally Infrastructure Managed os Eligible Asset Types Private Venture Structu
Slide 20: Projected Target Market Growth
Projected Target Market Growth Focus on U.S. Medium-to-High Net Worth (MHNW) i Il-t Sized | . a ta ( ) p rowing, but traditionally underserved liquidity market High Growth A All i Fast Growing sset Allocation incroaced Asset Class Wealth Segment Tailwinds Demand for Alternatives AUM growing at a Inc
Slide 21: Survey Results Reflect the Target Market Opportunity
h high interest in alternatives, along Survey Results Reflect the Target Market Opportunity t y issi 1 by Ben of 600 with the need for liquidity 1 00% ° i eresti i i ‘ rapid au) 214, - investments* advisor to obtain liquidity? 829 Only 10% would choose all cash? TOP TAKEAWAYS for opportunistic reaso
Slide 22: Go-to-Market Strategy To Meet Industry Demand for Liquidity
Go-to-Market Strategy To Meet Industry Demand for Liquidity Omnichannel approach designed to capitalize on early mover advantages and capture meaningful market share Source of Fund Sponsor | GP Solutions Distribution Channel Preferred National Advisory Coverage Direct-to- Investor Financial Why It’s
Slide 23: Ben's Regulatory Advantage
Ben’s Regulatory Advantage Ben serves as a regulated fiduciary in providing liquidity, di. to alternative asset investors & managers Ben’s Services Provide a Model of Efficiency Strong standard of * Holds similar fiduciary * Duty of loyalty, * Regular examination by integrity, trust & powers to bank
Slide 24: Solving a Market Need through a Regulated Customer Journey
Platt Solving a Market Need through a Regulated Customer Journey i th digital deli f and seeks a rapid approach to providing liquidi p Ben AltAccess™ Overvii i i Experience ly through Customer ~) Ben Action: ——— @, automated proposal to customer i it i f ® to deliver liquidi typically in days, not m
Slide 25: Leveraging Digital Technology to Provide a Simple & Rapid Exit
Leveraging Digital Technology to Provide a Simple & Rapid Exit desi Faster liquidity timelines are made possible by Ben AltAccess™, a digital secure AT&T NetBond® certified tech platform igned to deliver liquidity and and Traditional Liquidity Providers Non-Disclosure Agreement J Ben 14-31 Days | ee
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Slide 28: Developing an End-to-End Digital Platform Structured to Ultimately Create a Flywheel Effect
Developing an End-to-End Digital Platform Structured to Ultimately Create a Flywheel Effect Across the Ecosystem Groundbreaking AltAccess® digital liquidity platf designed to drive complementary lines of business custody it ustom third-party G ore, STMI investors & % 3 2 ES oxstomey % ‘© . 2%, . 3°
Slide 29: Ben AltAccess FinTech System Map
Vv Self-service user experience Y Customer visibility into transaction vY White label solutions for distribution partners v Full API connectivity Ben AltAccess FinTech System Map Customer Admin Salesforce v One-stop shop manages all customer information v System integration with AltAccess and BIDS (
Slide 30: Ben's Information Security Program
Ben’s Information Security Program Evaluations Ben Performs Gramm-Leach-Bliley Act (GLBA) Information Security Program established maturity levels Phishing assessment and training compliance SOC 2 Type Il underway
Slide 31: Risk Overview
Risk Overview Pee e ewe weer reese esses eseseseeseeseeseseEeEEesEEESEEEEE OES POP eRe ee moe e eee sere eee eeeeeeeeEseeese Cee e meee meee eee e ee ee eres eeeeseeeseesesesesesesseseesessssssseses
Slide 32: Robust Risk Management Framework
Robust Risk Management Framework Hat Proficient fiduciary | | risk management help anchor Ben’s originations and underwriting processes Ben’s Total Collateral Management (TCM) framework provides coherent risk management and monitoring of ExAlt loan collateral inventory, market exposures and diversif
Slide 33: Collateral Diversification — Optimumalt Target Allocations
Collateral Diversification — Optimumalt™ Target Allocations ¢ Driven by Ben’ 's patent-pending Optimumalt’ propr ietar Vv mean * System to deliver optimal risk Ite tive assets, helpi te a diversified y' aggregate inventory across asset classes, regions and sectors Asset Class Geography North Europe,
Slide 34: Equity Financing Pricing Process / Ben Analytics System
Bquiaity Financing Pricing Process / Ben Analytics System C i is t lyze loan collateral, helping Ben provide fast and Sal. need Tawi Collateral Assets Data & Characteristics (Underwriting) J Down Forecasts (Risk) * Ben inventory compatibility Risk-adjusted discount rates ny Bottom-Up Forecasts (Unde
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Slide 36: Underwriting Overview
Underwriting Overview Combines modern quantitative investment techniqui ith sophisticated fundamental analysis for loan collateral underwriting Projected Collateral Net Cash Flows Over Time * Led by Risk Department + Multifactor model by asset class Technical Top-Down Alternative distributions and c
Slide 37: Ben Liquidity - Data Collection
Ben Liquidity - bdehoa Collection Ben captures a vast t quantity of data related t Collection enh nent ate ep eine nl * Quarterly Unaudited Financials & Fund Report * Annual Audited Financials Annual Financial Statement December 31, "000 ata provides opp CY ity for increasingly (al) Investments () C
Slide 38: Ben Liquidity — Fundamental Forecasting Analysis
Ben Liquidity — Fundamental Forecasting Analysis ltinlo fi | p dilig through proprietary systems that leverage Ben’s ext llecti f fund and portfolio company data and leading third-party platforms Alternative Assets Manager & Fund Diligence Alternative Asset Investment Level Diligence Examines v v v
Slide 39: Fiduciary Loan Characteristics (As of September 30, 2022)
Fiduciary Loan Characteristics (As of September 30, 2022) Based on aggregate Fiduciary Loan Balance Industry Sector? Geography? Investment Strategy? Status* Net Other Assets, Earnouts, Escrows Private Natural Real Estate Resources Venture Capital - es Early Stage ci Private Equity Private Equity - G
Slide 40: Fiduciary Loan Characteristics (As of September 30, 2022)
Fiduciary Loan Characteristics (As of September 30, 2022) Industry Sector* Housel Pharm. Biotech ers, rod Rel & Life s As of September 30, 2022, t ese Certain of ur former parent sand te subsides equity an vehicles, including, tinted partnership interest and private and public equity 1 Based on the
Slide 41: Financial Highlights
Slide 42: Liquidity Transaction Economics
Liquidity Transaction Economics? All transaction-related fees embedded into the determination of the advance rate, allowing customer to avoid out-of-pocket ayment of fees Certain Services / Costs Covered Expected Rates Rate Basis Revenue) Recognition of Ben’s products and services * Transfer of Alte
Slide 43: Revenues Per Financial Statement Reporting
Revenues Per Financial Statement Reporting Busi revenues, not the ExAlt Trusts or lidati liminati illustrate the impact of liquidity transactions Consolidated Customer Corporate & | Consolidating Othi Ben Custody ExAlt Trusts er Eliminations o° ange in unrealized va AV from ane aeset clr (required u
Slide 44: Buildup of Annualized Net Revenue Rate from an ExchangeTrust
Buildup of Annualized Net Revenue Rate from an ExchangeTrust Fiduciary Loan Transaction Interest and fee 1 f from bl basis (typically based on collateral NAV or ExAlt loan balance) and accounting for revenue recognition timing into an annualized revenue rate as a % of original ExAlt loan balance! 10
Slide 45: Transaction Parties
Transaction Parties Transaction Summary Equity Valuation / ship Ow nersh Transaction Overview LP. (“Ben”) Avalon Acquisition Inc. (“AVAC”) AVAC has $207mm in trust Aligned for Long-Term Ny Assu Assumi mes no Considerati share 2029 2029 of Beneficient Class A common stock. Includes asset PIPE closed
Slide 46: Conclusion and Q&A
Conclusion and Q&A Pa