Benson Hill, Inc. [BHIL-WT] Filings

10-Q 1 bhil-20230630.htm 10-Q 2Q23 FORM 10Q bhil-20230630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____ to ______

Commission file number 001-39835

Benson Hill, Inc.

(Exact name of registrant as specified in its charter)


Delaware			85-3374823
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

1001 North Warson Rd	St. Louis,	Missouri	63132
(Address of Principal Executive Offices)			(Zip Code)

(314) 222-8218

(Registrant's telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.0001 par value	BHIL	The New York Stock Exchange
Warrants exercisable for one share of common stock at an exercise price of $11.50	BHIL WS	The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Table of Contents

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

As of August 7, 2023, 207,974,435 shares of the registrant’s Common Stock, par value $0.0001, were issued and outstanding.

Table of Contents

Benson Hill, Inc.

TABLE OF CONTENTS


		Page
Part I - Financial Information
Item 1.	Condensed Consolidated Financial Statements	4
	Condensed Consolidated Balance Sheets (Unaudited)	4
	Condensed Consolidated Statements of Operations (Unaudited)	5
	Condensed Consolidated Statements of Comprehensive Loss (Unaudited)	6
	Condensed Consolidated Statements of Stockholders’ Equity (Unaudited)	7
	Condensed Consolidated Statements of Cash Flows (Unaudited)	8
	Notes to the Condensed Consolidated Financial Statements (Unaudited)	10
Item 2.	Management ’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	36
Item 4.	Controls and Procedures	36
Part II - Other Information
Item 1.	Legal Proceedings	37
Item 1A.	Risk Factors	37
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	39
Item 3.	Defaults Upon Senior Securities	39
Item 4.	Mine Safety Disclosures	39
Item 5.	Other Information	39
Item 6.	Exhibits	41
Signatures		42

Table of Contents

Part I - Financial Information

Item 1. Financial Statements

Benson Hill, Inc.

Condensed Consolidated Balance Sheets (Unaudited)
(In Thousands, Except Per Share Data)


	June 30, 2023		December 31, 2022
Assets
Current assets:
Cash and cash equivalents	$	13,882	$	25,053
Marketable securities	80,514		132,121
Accounts receivable, net	36,456		28,591
Inventories, net	42,670		62,110
Prepaid expenses and other current assets	28,941		29,346
Current assets of discontinued operations	4,226		23,507
Total current assets	206,689		300,728
Property and equipment, net	99,658		99,759
Finance lease right-of-use assets, net	63,185		66,533
Operating lease right-of-use assets	5,628		1,660
Goodwill and intangible assets, net	7,774		27,377
Other assets	9,367		4,863
Total assets	$	392,301	$	500,920

Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	20,607	$	36,717
Finance lease liabilities, current portion	3,725		3,318
Operating lease liabilities, current portion	1,310		364
Long-term debt, current portion	2,246		2,242
Accrued expenses and other current liabilities	22,224		33,435
Current liabilities of discontinued operations	4,031		16,441
Total current liabilities	54,143		92,517
Long-term debt, less current portion	105,185		103,991
Finance lease liabilities, less current portion	75,746		76,431
Operating lease liabilities, less current portion	6,512		1,291
Warrant liabilities	11,732		24,285
Conversion option liabilities	1,983		8,091
Deferred income taxes	155		283
Other non-current liabilities	242		129
Total liabilities	255,698		307,018
Stockholders’ equity:
Common stock, $0.0001 par value, 440,000 and 440,000 shares authorized, 207,467 and 206,668 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively	21		21
Additional paid-in capital	608,522		609,450
Accumulated deficit	(468,369)		(408,474)
Accumulated other comprehensive loss	(3,571)		(7,095)
Total stockholders’ equity	136,603		193,902
Total liabilities and stockholders’ equity	$	392,301	$	500,920

See accompanying notes to the condensed consolidated financial statements (unaudited).

Table of Contents

Benson Hill, Inc.

Condensed Consolidated Statements of Operations (Unaudited)
(In Thousands, Except Per Share Data)


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Revenues	$	109,038	$	93,631	243,681		159,757
Cost of sales	106,070		87,889		231,190		162,950
Gross profit (loss)	2,968		5,742		12,491		(3,193)
Operating expenses:
Research and development	10,313		12,006		22,955		24,301
Selling, general and administrative expenses	10,851		20,281		27,018		40,536
Impairment of goodwill	19,226		—		19,226		—
Total operating expenses	40,390		32,287		69,199		64,837
Loss from operations	(37,422)		(26,545)		(56,708)		(68,030)
Other (income) expense:
Interest expense, net	6,874		3,442		13,246		9,830

Changes in fair value of warrants and conversion option	3,036		(5,899)		(18,660)		(37,640)
Other expense, net	1,921		954		2,789		2,285
Total other (income) expense, net	11,831		(1,503)		(2,625)		(25,525)
Net loss from continuing operations before income taxes	(49,253)		(25,042)		(54,083)		(42,505)
Income tax expense (benefit)	(138)		56		(123)		17
Net loss from continuing operations, net of income taxes	(49,115)		(25,098)		$	(53,960)	$	(42,522)
Net loss from discontinued operations, net of income taxes (refer to Note 4, Discontinued Operations)	(7,726)		(2,456)		(5,935)		(1,608)
Net loss attributable to common stockholders	$	(56,841)	$	(27,554)	$	(59,895)	$	(44,130)

Net loss per common share:
Basic and diluted net loss per common share from continuing operations	$	(0.26)	$	(0.14)	$	(0.29)	$	(0.24)
Basic and diluted net loss per common share from discontinued operations	$	(0.04)	$	(0.01)	$	(0.03)	$	(0.01)
Basic and diluted total net loss per common share	$	(0.30)	$	(0.15)	$	(0.32)	$	(0.25)
Weighted average shares outstanding:
Basic and diluted weighted average shares outstanding	187,725		185,530		187,421		173,189

See accompanying notes to the condensed consolidated financial statements (unaudited).

Table of Contents

Benson Hill, Inc.

Condensed Consolidated Statements of Comprehensive Loss (Unaudited)
(In Thousands)


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Net loss attributable to common stockholders	$	(56,841)	$	(27,554)	$	(59,895)	$	(44,130)
Foreign currency:
Comprehensive income (loss)	—		20		—		(45)
	—		20		—		(45)
Marketable securities:
Comprehensive income (loss)	4,662		(4,393)		6,568		(8,159)
Adjustment for net income (loss) realized in net loss	(1,994)		1,022		(3,044)		2,229
	2,668		(3,371)		3,524		(5,930)
Total other comprehensive income (loss)	2,668		(3,351)		3,524		(5,975)
Total comprehensive loss	$	(54,173)	$	(30,905)	$	(56,371)	$	(50,105)

See accompanying notes to the condensed consolidated financial statements (unaudited).

Table of Contents

Benson Hill, Inc.

Condensed Consolidated Statements of Stockholders’ Equity (Unaudited)
(In Thousands, Except Per Share Data)


	Common Stock			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders’ Equity
	Shares	Amount
Balance as of December 31, 2022	206,668	$	21	$	609,450	$	(408,474)	$	(7,095)	$	193,902
Stock option exercises, net	791	—		121		—		—		121
Stock-based compensation expense	—	—		2,814		—		—		2,814

Comprehensive income (loss)	—	—		—		(3,054)		856		(2,198)
Balance as of March 31, 2023	207,459	$	21	$	612,385	$	(411,528)	$	(6,239)	$	194,639
Stock option exercises, net	8	—		19		—		—		19
Stock-based compensation expense	—	—		(3,882)		—		—		(3,882)
Comprehensive income (loss)	—	—		—		(56,841)		2,668		(54,173)
Balance as of June 30, 2023	207,467	$	21	$	608,522	$	(468,369)	$	(3,571)	$	136,603


	Common Stock			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders’ Equity
	Shares	Amount
Balance as of December 31, 2021	178,089	$	18	$	533,101	$	(280,569)	$	(1,103)	$	251,447
Stock option exercises, net	830	—		636		—		—		636
Stock-based compensation expense	—	—		5,683		—		—		5,683
PIPE Investment, net of issuance cost of $3,456	26,150	3		54,925		—		—		54,928
Comprehensive loss	—	—		—		(16,576)		(2,624)		(19,200)
Balance as of March 31, 2022	205,069	$	21	$	594,345	$	(297,145)	$	(3,727)	$	293,494
Stock option exercises, net	547	—		715		—		—		715
Stock-based compensation expense	—	—		5,676		—		—		5,676
Comprehensive loss	—	—		—		(27,554)		(3,351)		(30,905)
Balance as of June 30, 2022	205,616	$	21	$	600,736	$	(324,699)	$	(7,078)	$	268,980

See accompanying notes to the condensed consolidated financial statements (unaudited).

Table of Contents

Benson Hill, Inc.

Condensed Consolidated Statements of Cash Flows (Unaudited)
(In Thousands)


	Six Months Ended June 30,
	2023		2022
Operating activities
Net loss	$	(59,895)	$	(44,130)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	10,596		10,942
Stock-based compensation expense	(1,214)		11,359
Bad debt expense	(197)		445
Changes in fair value of warrants and conversion option	(18,660)		(37,640)
Accretion and amortization related to financing activities	4,318		5,875
Realized losses on sale of marketable securities	3,044		2,229
Impairment of goodwill	19,226		—

Other	2,593		3,521
Changes in operating assets and liabilities:
Accounts receivable	(1,614)		(5,469)
Inventories	31,072		9,117
Other assets and other liabilities	909		5,293
Accounts payable	(23,708)		(12,722)
Accrued expenses	(10,751)		(7,552)
Net cash used in operating activities	(44,281)		(58,732)
Investing activities
Purchases of marketable securities	(75,050)		(248,637)
Proceeds from maturities of marketable securities	41,759		9,549
Proceeds from sales of marketable securities	84,385		170,217
Purchase of property and equipment	(6,956)		(5,637)
Acquisition, net of cash acquired	—		(1,034)
Proceeds from divestiture of discontinued operations	1,928		—
Other	36		—
Net cash provided by (used in) investing activities	46,102		(75,542)
Financing activities
Contributions from PIPE Investment, net of transaction costs $3,761 in 2022	—		81,234
Repayments of long-term debt	(4,313)		(4,576)
Proceeds from issuance of long-term debt	—		24,078
Payments of debt issuance costs	(2,000)		(38)
Borrowing under revolving line of credit	—		12,491
Repayments under revolving line of credit	—		(11,783)
Payments of finance lease obligations	(1,595)		(629)
Proceeds from exercise of stock awards, net of withholding taxes	140		1,351

Net cash (used in)/provided by financing activities	(7,768)		102,128
Effect of exchange rate changes on cash	—		(45)
Net decrease in cash and cash equivalents	(5,947)		(32,191)
Cash, cash equivalents and restricted cash, beginning of period	43,321		78,963
Cash, cash equivalents and restricted cash, end of period	$	37,374	$	46,772

Table of Contents


Supplemental disclosure of cash flow information
Cash paid for taxes	$	2	$	1
Cash paid for interest	$	9,555	$	5,900
Supplemental disclosure of non-cash activities
PIPE Investment issuance costs included in accrued expenses and other current liabilities	$	—	$	362
Purchases of property and equipment included in accounts payable and accrued expenses and other current liabilities	$	333	$	2,255
Financing leases commencing in the period	$	—	$	806

See accompanying notes to the condensed consolidated financial statements (unaudited).

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements

(Unaudited)

(In Thousands, Except Per Share Data)

1. Description of Business

Benson Hill, Inc. and subsidiaries (collectively, “Benson Hill”, the “Company”, “we”, “us”, or “our”) is a food technology company on a mission to lead the pace of innovation in food. We have a vision to build a healthier and happier world by unlocking the natural genetic diversity of plants with our leading technology platform, CropOS®. Starting with consumer demand, we leverage CropOS® and advanced breeding techniques to design food that’s better from the beginning: more nutritious, more flavorful, and more accessible, while enabling efficient production and delivering novel sustainability benefits to food and feed customers. We are headquartered in St. Louis, Missouri, where the majority of our research and development activities are managed. We operate a soy crushing and food-grade white flake and soy flour manufacturing operation in Creston, Iowa, a soy crushing facility in Seymour, Indiana, and we process dry peas in North Dakota, which we sell throughout North America.

Fresh Business Segment Divestiture

On December 29, 2022, the Company entered into a Stock Purchase Agreement (the “Stock Sale”) to sell J&J Produce, Inc. (“J&J”) and all of the outstanding equity securities of J&J’s subsidiaries for aggregate cash consideration of $3,000, subject to certain adjustments. J&J was the main component of the former Fresh segment. In connection with the Stock Purchase Agreement, on December 29, 2022, J&J entered into a Purchase and Sale Agreement, pursuant to which J&J sold certain real and personal property comprising an agricultural production and processing facility located in Vero Beach, Florida, for an aggregate purchase price of $18,000, subject to certain adjustments. Certain property was leased back to J&J pursuant to a separate agricultural and facility lease for a short period of time. On June 30, 2023, the Company closed the Stock Sale. The Company’s strategic shift to exit the Fresh segment met the criteria to be classified as businesses held for sale and to be presented as a discontinued operation. Refer to Note 4, Discontinued Operations for further details on the divestiture of the former Fresh segment.

Liquidity and Going Concern

The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial reporting and Securities and Exchange Commission (“SEC”) regulations, assuming the Company will continue as a going concern.

For the three and six months ended June 30, 2023, the Company incurred a net loss from continuing operations of $49,115 and $53,960, respectively, and for the six months ended June 30, 2023, the Company had negative cash flows from operating activities of $44,281 and had capital expenditures of $6,956. As of June 30, 2023, the Company had cash and marketable securities of $94,396 and restricted cash of $19,840. Furthermore, as of June 30, 2023, the Company had an accumulated deficit of $468,369 and term debt and notes payable of $107,431, which are subject to repayment terms and covenants further described in Note 9, Debt. Specifically, scheduled principal payments on the Convertible Notes Payable are due starting in the third quarter of 2024. The Company has incurred significant losses since its inception, primarily to fund investment into technology and costs associated with early-stage commercialization of products.

These factors, coupled with expected debt repayments and capital expenditures indicated that, without further action, the Company’s forecasted cash flows would not be sufficient for the Company to meet its contractual commitments and obligations as they came due in the ordinary course of business for 12 months after the date the condensed consolidated financial statements are issued. Therefore, there is now substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are issued.

During the first quarter of 2023, the Company entered into an amendment to its existing Convertible Loan and Security Agreement, which among other things, extended the interest-only period by six months through the second quarter of 2024, and allowed the restricted cash to be counted towards the required minimum liquidity covenant calculation. In addition, the Company’s liquidity plans and operating budget include further actions that management believes are probable of being achieved in the 12 months after the date the condensed consolidated financial statements were issued. These actions include improving operating efficiencies by reducing certain operating costs and restructuring certain parts of the organization. In addition, the Company is considering additional actions to allow the Company to meet its obligations as they come due including exploring strategic options involving its Seymour, Indiana soy crush facility, supplementing cash needs by selling additional shares of its common stock, or securities convertible into common stock, to the public through its shelf registration

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements (continued)

(Unaudited)

(In Thousands, Except Per Share Data)

statement, or obtaining alternative equity financing, and potentially refinancing its current high-cost debt with a conventional, lower cost, lending facility of up to $100 million. There are no guarantees that the Company will achieve any of these plans, which involve risks and uncertainties.

For the three and six months ended June 2023, the Company recognized severance charges of $1,126 and $1,238, respectively, within selling, general and administrative expenses on the Condensed Consolidated Statement of Operations.

2. Summary of Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial reporting and SEC regulations. The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. Results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year ended December 31, 2023. A description of the Company’s significant accounting policies is included in the notes to our audited consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2022. These unaudited condensed consolidated financial statements should be read in conjunction with the December 31, 2022 audited consolidated financial statements and the notes thereto.

Any reference in these notes to applicable guidance is meant to refer to the authoritative U.S. GAAP as found in the Accounting Standards Codification (“ASC”) and an Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”).

Certain prior period balances have been reclassified to conform to the current period presentation in the unaudited condensed consolidated financial statements and the accompanying notes.

Emerging Growth Company Status

We are an “emerging growth company,” as defined in Section 2(a) of the Securities Act and have elected to take advantage of the benefits of the extended transition period for new or revised financial accounting standards. We expect to remain an emerging growth company at least through December 31, 2023 and expect to continue to take advantage of the benefits of the extended transition period, although we may decide to early adopt such new or revised accounting standards to the extent permitted by such standards. We expect to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and non-public companies until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”). This may make it difficult or impossible to compare our financial results with the financial results of another public company that is either not an emerging growth company or is an emerging growth company that has chosen not to take advantage of the extended transition period exemptions because of the potential differences in accounting standards used.

In addition, we intend to rely on the other exemptions and reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an emerging growth company, we intend to rely on such exemptions, we are not required to, among other things: (a) provide an auditor’s attestation report on our system of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; (b) provide all of the compensation disclosures that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act; (c) comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis); and (d) disclose certain executive compensation-related items such as the correlation between executive compensation and performance and comparisons of the Chief Executive Officer’s compensation to median employee compensation.

We will remain an emerging growth company under the JOBS Act until the earliest of (a) December 31, 2026, (b) the last date of our fiscal year in which we have total annual gross revenue of at least $1.235 billion, (c) the date on which we are deemed to be a “large accelerated filer” under the rules of the SEC with at least $700.0 million of outstanding securities held by non-

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements (continued)

(Unaudited)

(In Thousands, Except Per Share Data)

affiliates or (d) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the previous three years.

Use of Estimates

The preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in its condensed consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Significant management estimates include those with respect to allowance for doubtful accounts, reserves for inventory obsolescence, the recoverability of long-lived assets, intangibles and goodwill and the estimated value of our warrant liabilities and conversion option liabilities.

Cash, Cash Equivalents and Restricted Cash

We consider all short-term, highly liquid investments with maturities of 90 days or less at the acquisition date to be cash equivalents. Restricted cash primarily represents cash proceeds from the sale of certain assets pursuant to the covenants with a lender. Restricted cash is classified as non-current if the Company expects that the cash will remain restricted for a period greater than one year. Current restricted cash is included in the prepaid expenses and other current assets on the condensed consolidated balance sheets.

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheets, inclusive of $3,652 of cash and cash equivalents reported within current assets of discontinued operations as of June 30, 2023 to the amount shown in the condensed consolidated statements of cash flows. There was no restricted cash as of June 30, 2022.


	June 30, 2023
Cash and cash equivalents	$	17,534
Restricted cash, current	19,840
Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows	$	37,374

Goodwill and Intangible Assets

Goodwill, arising from a business combination as the excess of purchase price and related costs over the fair value of identifiable assets acquired and liabilities assumed is not amortized and is subject to an annual impairment test as of December 1, unless events indicate an interim test is required. In performing this impairment test, management will first qualitatively assess indicators of a reporting unit’s fair value. If, after completing the qualitative assessment, management believes it is likely that a reporting unit is impaired, a discounted cash flow analysis is prepared to estimate the fair value of the reporting unit.

Critical estimates in the determination of the fair value of each reporting unit include, but are not limited to, future expected cash flows based on estimates of future sales volumes, sales prices, production costs, and discount rates. These estimates generally constitute unobservable Level 3 inputs under the fair value hierarchy. An adjustment to goodwill will be recorded for any goodwill that is determined to be impaired.

As of June 30, 2023, the Company identified an indicator of impairment and determined it was no longer more likely than not that the fair value of the Company’s sole reporting unit was in excess of the carrying value. As a result, a quantitative goodwill and separately identifiable intangible asset impairment assessment was performed as of June 30, 2023, and the Company recorded an impairment of the carrying value of goodwill of $19,226, which represented the entire goodwill balance prior to the impairment charge. The goodwill impairment charge had an immaterial impact on the provision for income taxes.

The Company performed an interim impairment analysis for the Ingredients reporting unit using a discounted cash flow model (a form of the income approach), utilizing Level 3 unobservable inputs. The Company’s estimates in this analysis included, but were not limited to, future cash flow projections, the weighted average cost of capital, the terminal growth rate, and the tax rate. The impairment charge reflects an ongoing assessment of current market conditions and potential strategic investments to continue commercializing its proprietary products and pursue other strategic investments in the industry.

For the quarter ended June 30, 2023, the Company determined there was no impairment of its intangible assets.

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements (continued)

(Unaudited)

(In Thousands, Except Per Share Data)

Stock Award Modifications

In June 2023, the Company announced that the former Chief Executive Officer (CEO) agreed to resign from the Company effective June 15, 2023, and entered into a consulting agreement to provide transition support through June 15, 2024. In connection with the separation, the Company modified the terms of its former CEO’s outstanding stock awards to (1) continue vesting over the consulting period through June 15, 2024 if continuous service is achieved with the Company; (2) extend the period during which the vested stock options may be exercised for a period of 90 days following the termination of consultancy, if continuous service is achieved with the Company; and (3) extend the period in which performance-based vesting conditions for restricted stock units may be achieved through June 15, 2024, if continuous service is achieved with the Company. As a result of the stock award modifications, the Company recorded a $6.2 million decrease to stock-based compensation expense for the three and six months ended June 30, 2023.

Recently Issued Accounting Guidance Not Yet Effective

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (“ASU 2020-04”). ASU 2020-04 provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. In December 2022, the FASB issued ASU 2022-06 and deferred the sunset date of the Reference Rate Reform (Topic 848) from December 31, 2022 to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848. The amendments apply to all entities that have contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The Company has a floating rate revolving credit facility, a term loan and an equipment loan due in 2024 and plans on phasing out LIBOR as a reference rate before December 31, 2024.

In August 2020, the FASB issued ASU 2020-06, Debt (“ASU 2020-06”). ASU 2020-06 reduces the number of accounting models for convertible debt instruments and convertible preferred stock. For convertible instruments with conversion features that are not required to be accounted for as derivatives under ASC 815, Derivatives and Hedging, or that do not result in substantial premiums accounted for as paid-in capital, the embedded conversion features no longer are separated from the host contract. ASU 2020-06 is effective for annual reporting periods beginning after December 15, 2023, and interim periods within those years, and early adoption is permitted. The Company is currently evaluating the impact ASU 2020-06 will have on its condensed consolidated financial statements.

3. Business Combinations

ZFS Creston

On December 30, 2021, we completed the acquisition of a food-grade white flake and soy flour manufacturing operation and related assets through the acquisition of ZFS Creston, LLC, a Delaware limited liability company (“ZFS Creston”), for aggregate cash consideration of $103,099, which includes a working capital adjustment payment of $1,034 in the first quarter of 2022.

4.Discontinued Operations

On December 29, 2022, the Company entered into a Stock Purchase Agreement (the “Stock Sale”) to sell J&J Produce, Inc. (“J&J”) and all of the outstanding equity securities of J&J’s subsidiaries for aggregate cash consideration of $3,000, subject to certain adjustments. In connection with the Stock Purchase Agreement, on December 29, 2022, J&J entered into a Purchase and Sale Agreement, pursuant to which J&J sold certain real and personal property comprising an agricultural production and processing facility located in Vero Beach, Florida, for an aggregate purchase price of $18,000, subject to certain adjustments. Certain property was leased back to J&J pursuant to a separate agricultural and facility lease for a short period of time. On June 30, 2023, the Company closed the Stock Sale. Upon closing, certain immaterial assets and liabilities of J&J were reclassified from held for sale to held and used as of June 30, 2023. No adjustment to the carrying value of those assets and liabilities was required based on a current reassessment of the fair value of those assets and liabilities.

J&J was the main component of the Company’s former Fresh segment. The Company’s strategic shift to exit the Fresh segment met the criteria to be classified as businesses held for sale and presented as a discontinued operation. Accordingly, the Company reclassified the results of operations of the Fresh segment to discontinued operations in its condensed consolidated statements

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements (continued)

(Unaudited)

(In Thousands, Except Per Share Data)

of operations for all periods presented. The carrying amounts of the assets and liabilities of the discontinued operations were as follows:


	June 30, 2023		December 31, 2022
Assets
Current assets:
Cash and cash equivalents	$	3,652	$	356
Accounts receivable, net	254		9,808
Inventories, net	—		11,633
Prepaid expenses and other current assets	320		1,710
Total assets from discontinued operations	$	4,226	$	23,507

Liabilities
Current liabilities:
Accounts payable	$	2,083	$	9,743
Current lease liability	—		1,890
Current maturities of long-term debt	—		3,194
Accrued expenses and other liabilities	1,948		1,614
Total liabilities from discontinued operations	$	4,031	$	16,441

As of December 31, 2022, the fair value of the debt included in the liabilities from discontinued operations was $3,305. Fair values are based upon valuation models using market information, which fall into Level 3 in the fair value hierarchy. The Company capitalized no interest costs into property and equipment for the three and six months ended June 30, 2023. The Company capitalized interest costs of $383 and $780, respectively, into property and equipment for the three and six months ended June 30, 2022.

The operating results of the discontinued operations, net of tax, were as follows:


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Revenues	$	9,902	$	17,116	$	32,237	$	43,435
Cost of sales	15,398		17,282		34,131		39,888
Gross profit	(5,496)		(166)		(1,894)		3,547
Operating expenses:
Research and development	—		11		—		22
Selling, general and administrative expenses	1,883		2,213		3,337		5,082

Total operating expenses	1,883		2,224		3,337		5,104
Interest expense	7		82		14		82
Other expense (income), net	340		(16)		690		(31)
Net loss from discontinued operations, before income taxes	(7,726)		(2,456)		(5,935)		(1,608)

Net loss from discontinued operations, net of income taxes	$	(7,726)	$	(2,456)	$	(5,935)	$	(1,608)

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements (continued)

(Unaudited)

(In Thousands, Except Per Share Data)

Depreciation, amortization and significant operating and investing items in the condensed consolidated statements of cash flows for the discontinued operations are as follows:


	Six Months Ended June 30,
	2023		2022
Operating activities
Depreciation and amortization	$	—	$	1,002
Bad debt expense	53		—

Net loss on divestiture	172		—
Investing activities
Payments for acquisitions of property and equipment	—		(3,129)
Net proceeds from divestiture	1,928		—

5. Fair Value Measurements

Assets and liabilities recorded at fair value on a recurring basis on the balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair values. The authoritative guidance on fair value measurements establishes a three-tier fair value hierarchy for disclosure of fair value measurements as follows:

Level 1 — Observable inputs such as unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.

Level 2 — Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the asset or liability. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.

Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Our financial instruments consist of cash and cash equivalents, restricted cash, marketable securities, accounts receivable, commodity derivatives, commodity contracts, accounts payable, accrued liabilities, warrant liabilities, conversion option liabilities, and notes payable. As of June 30, 2023 and December 31, 2022, we had cash and cash equivalents of $13,882 and $25,053, respectively, which includes money market funds with maturities of less than three months. As of June 30, 2023 and December 31, 2022, we had restricted cash of $19,840 and $17,912. At June 30, 2023 and December 31, 2022, the carrying values of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, and accrued liabilities approximated fair value due to their short maturities.

The following tables provide the financial instruments measured at fair value on a recurring basis based on the fair value hierarchy:


	June 30, 2023
	Level 1		Level 2		Level 3		Total
Assets
U.S. treasury securities	$	20,259	$	—	$	—	$	20,259
Corporate bonds	$	—	$	45,934	$	—	$	45,934
Preferred stock	—		14,321		—		14,321
Marketable securities	$	20,259	$	60,255	$	—	$	80,514
Liabilities
Warrant liabilities	$	3,409	$	—	$	8,323	$	11,732
Conversion option liabilities	—		—		1,983		1,983
Total liabilities	$	3,409	$	—	$	10,306	$	13,715

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements (continued)

(Unaudited)

(In Thousands, Except Per Share Data)


	December 31, 2022
	Level 1		Level 2		Level 3		Total
Assets
U.S. treasury securities	$	1,059	$	—	$	—	$	1,059
Corporate bonds	—		116,616		—		116,616
Preferred stock	—		14,446		—		14,446
Marketable securities	$	1,059	$	131,062	$	—	$	132,121
Liabilities
Warrant liabilities	$	5,469	$	—	$	18,816	$	24,285
Conversion option liabilities	—		—		8,091		8,091
Total liabilities	$	5,469	$	—	$	26,907	$	32,376

There were no transfers of financial assets or liabilities into or out of Level 1, Level 2, or Level 3 for 2023 or 2022.

All of the Company’s derivative contracts are centrally cleared and therefore are cash-settled on a daily basis. This results in the derivative contracts having a fair value that approximates zero on a daily basis. Therefore, there are no derivative assets or liabilities included in the table above. Refer to Note 7, Derivatives for further discussion.

The warrant liabilities consist of PIPE Investment Warrants, Convertible Notes Payable Warrants, Notes Payable Warrants, Private Placement Warrants, and Public Warrants. History, fair value hierarchy, valuation techniques and inputs of those warrants are more fully described in Note 5, Fair Value Measurements and Note 15, Warrant Liabilities, to the Consolidated Financial Statements included in the Annual Report on Form 10-K for the year ended December 31, 2022. Pursuant to the Third Amendment to the Convertible Loan and Security Agreement, the exercise price of the Convertible Notes Payable Warrants (the “Conversion Price”) is the lowest of (i) $2.47; (ii) the 5-day VWAP determined as of March 10, 2023, where “5-day VWAP” means the volume-weighted average price of the Company’s Common Stock, determined for the five consecutive trading days ending on the last trading day immediately preceding the applicable date; and (iii) the effective price per share of any bona fide equity offering prior to March 10, 2024. As such, these warrant liabilities are now valued based on a Monte Carlo simulation that values the warrants using a probability weighted discounted cash flow model, which are considered Level 3 liabilities, whereas previously they were valued based on Black-Scholes option pricing model.

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements (continued)

(Unaudited)

(In Thousands, Except Per Share Data)

The significant inputs to the valuation of Level 3 warrants and conversion option liabilities as of June 30, 2023 were as follows:


	PIPE Investment Warrants			Private Placement Warrants			Convertible Notes Payable Warrants			Conversion Option Liabilities
Exercise Price	$	3.90		$	11.50		$	2.27		$	2.47
Stock Price	$	1.30		$	1.30		$	1.30		$	1.30
Volatility	96.1		%	105.0		%	97.5		%	74.9		%
Remaining term in years	3.74			3.25			3.50			1.50
Risk-free rate	4.4		%	4.5		%	4.4		%	5.1		%
Dividend yield	—		%	—		%	—		%	—		%

The significant inputs to the valuation of Level 3 warrants and conversion option liabilities as of December 31, 2022 were as follows:


	PIPE Investment Warrants			Private Placement Warrants			Convertible Notes Payable Warrants			Conversion Option Liabilities
Exercise Price	$	3.90		$	11.50		$	2.47		$	2.47
Stock Price	$	2.55		$	2.55		$	2.55		$	2.55
Volatility	90.4		%	84.0		%	89.0		%	64.7		%
Remaining term in years	4.24			3.75			4.00			2.00
Risk-free rate	4.0		%	4.1		%	4.1		%	4.4		%
Dividend yield	—		%	—		%	—		%	—		%

The following table summarizes the changes in the warrants and conversion option liabilities categorized as Level 3 for the three and six months ended June 30, 2023 and 2022:


	Three Months Ended June 30, 2023		Six Months Ended June 30, 2023
Balance, beginning of period	$	8,471	$	26,907
Changes in estimated fair value	1,835		(16,601)
Ending balance, June 30, 2023	$	10,306	$	10,306


	Three Months Ended June 30, 2022		Six Months Ended June 30, 2022
Balance, beginning of period	$	45,169	$	42,457
Changes in estimated fair value	(6,101)		(29,993)
Issuance of PIPE Investment warrants	—		26,604
Ending balance, June 30, 2022	$	39,068	$	39,068

Fair Value of Long-Term Debt

As of June 30, 2023 and December 31, 2022, the fair value of the Company’s debt, including amounts classified as current, was $103,712 and $103,814, respectively. Fair values are based upon valuation models using market information, which fall into Level 3 in the fair value hierarchy.

6. Investments in Available-for-Sale Securities

The Company has invested in marketable debt securities, primarily investment-grade corporate bonds, preferred stock, and highly liquid U.S Treasury securities, which are held in the custody of a major financial institution. These securities are

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements (continued)

(Unaudited)

(In Thousands, Except Per Share Data)

classified as available-for-sale and, accordingly, the unrealized gains and losses are recorded through other comprehensive income and loss.

Marketable securities classified as available-for-sale securities are summarized below:


	June 30, 2023
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. treasury securities	$	20,939	$	—	$	(27)	$	20,912
Corporate bonds	47,818		1		(2,408)		45,411
Preferred stock	15,144		18		(971)		14,191
Total Investments	$	83,901	$	19	$	(3,406)	$	80,514


	December 31, 2022
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. treasury securities	$	1,059	$	—	$	—	$	1,059
Corporate bonds	122,257		—		(5,641)		116,616
Preferred stock	15,454		—		(1,008)		14,446
Total Investments	$	138,770	$	—	$	(6,649)	$	132,121

The aggregate fair value of investments with unrealized losses that had been owned for less than a year was $36,318 and $66,296 as of June 30, 2023 and December 31, 2022, respectively. The aggregate fair value of investments with unrealized losses that had been owned for more than one year was $36,679 and $64,723 as of June 30, 2023 and December 31, 2022, respectively.

Available-for-sale investments outstanding as of June 30, 2023, classified as marketable securities in the condensed consolidated balance sheets, have maturity dates ranging from the third quarter of 2023 through the fourth quarter of 2026. The fair value of marketable securities as of June 30, 2023 with maturities within one year and one to five years is $50,353 and $30,161, respectively. The Company classifies available-for-sale investments as current based on the nature of the investments and their availability to provide cash for use in current operations, if needed.

7. Derivatives

Corporate Risk Management Activities

The Company uses exchange-traded futures to manage price risk of fluctuating Chicago Board of Trade prices related to forecasted purchases and sales of soybeans and soybean related products in the normal course of business. These risk management activities are actively monitored for compliance with the Company’s risk management policies.

As of June 30, 2023, the Company held financial futures related to a portion of its forecasted purchases of soybeans for an aggregate notional volume of 6,360 bushels of soybeans; 5,305 bushels of the aggregate notional volume will settle in 2023 with the remaining 1,055 bushels settling in 2024. As of June 30, 2023, the Company held financial futures related to a portion of its forecasted sales of soybean oil for an aggregate notional volume of 637 pounds of soybean oil; all of which will settle in 2023. As of June 30, 2023, the Company held financial futures related to a portion of its forecasted sales of soybean meal for an aggregate notional volume of 91 tons of soybean meal, all of which will settle in 2023.

Tabular Derivatives Disclosures

The Company has master netting agreements with its counterparties, which allow for the settlement of contracts in an asset position with contracts in a liability position in the event of default or termination. Such netting arrangements reduce the Company’s credit exposure related to these counterparties. As all of the Company’s derivative contracts are centrally cleared

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements (continued)

(Unaudited)

(In Thousands, Except Per Share Data)

and therefore are cash-settled on a daily basis, the fair value approximates zero. The Company’s derivative contracts were as follows:


	June 30, 2023				December 31, 2022
	Asset Derivative		Liability Derivative		Asset Derivative		Liability Derivative
Soybeans	$	1,451	$	2,612	$	1,112	$	1,925
Soybean oil	1,104		2,318		533		73
Soybean meal	1,429		—		400		2,414
Effect of daily cash settlement	(3,984)		(4,930)		(2,045)		(4,412)
Net derivatives as classified in the balance sheet	$	—	$	—	$	—	$	—

The Company had a current asset representing excess cash collateral posted to a margin account of $757 and $2,714 as of June 30, 2023 and December 31, 2022, respectively. These amounts are not included with the derivatives presented in the table above and are included in prepaid expenses and other current assets in the condensed consolidated balance sheets.

Currently, the Company does not seek cash flow hedge accounting treatment for its derivative financial instruments and thus changes in fair value are reflected in current earnings.

The tables below show the amounts of pre-tax gains and losses related to the Company’s derivatives:


	Three Months Ended June 30, 2023						Three Months Ended June 30, 2022
	Gain (loss) realized on derivatives		Unrealized gain (loss) on derivatives		Total gain (loss) recognized in income		Gain (loss) realized on derivatives		Unrealized gain (loss) on derivatives		Total gain (loss) recognized in income
Soybeans	$	(1,410)	$	479	$	(931)	$	(1,278)	$	1,605	$	327
Soybean oil	2,093		(1,674)		419		(2,447)		1,672		(775)
Soybean meal	3,259		18		3,277		(299)		1,602		1,303
Total	$	3,942	$	(1,177)	$	2,765	$	(4,024)	$	4,879	$	855


	Six Months Ended June 30, 2023						Six Months Ended June 30, 2022
	Gain (loss) realized on derivatives		Unrealized gain (loss) on derivatives		Total gain (loss) recognized in income		Gain (loss) realized on derivatives		Unrealized gain (loss) on derivatives		Total gain (loss) recognized in income
Soybeans	$	(1,247)	$	(348)	$	(1,595)	$	(6,231)	$	1,211	$	(5,020)
Soybean oil	2,500		(1,675)		825		(7,405)		207		(7,198)
Soybean meal	(74)		3,444		3,370		(245)		772		527
Total	$	1,179	$	1,421	$	2,600	$	(13,881)	$	2,190	$	(11,691)

The Company’s soybean positions are designed to hedge risk related to inventory purchases, therefore the gains and losses on soybean instruments are recorded in cost of sales in the condensed consolidated statements of operations. The Company’s soybean oil and soybean meal positions are designed to hedge risk related to sales transactions therefore the gains and losses on soybean oil and soybean meal instruments are recorded in revenues in the condensed consolidated statements of operations.

The Company classifies the cash effects of its derivatives within the “Cash Flows from Operating Activities” section of the condensed consolidated statements of cash flows.

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements (continued)

(Unaudited)

(In Thousands, Except Per Share Data)

8. Inventories, Net

Inventories, net consist of the following:


	June 30, 2023		December 31, 2022
Raw materials and supplies	$	21,510	$	37,483
Work-in-process	7,230		4,977
Finished goods	13,930		19,650
Total inventories	$	42,670	$	62,110

Work-in-process inventory consists of seed provided to contracted seed producers and growers with which we hold a purchase option for, or are required to purchase the future harvested seeds or grains. It also includes crops under production which represent the direct costs of land preparation, seed, planting, growing, and maintenance.

9. Debt


	June 30, 2023		December 31, 2022
DDB Term loan, due April 2025	$	6,825	$	7,393
DDB Equipment loan, due July 2024	875		1,225
Convertible Notes Payable, due January 2025	112,700		110,700
Equipment Financing, due March 2025	681		873
Notes payable, varying maturities through June 2026	71		81

Less: unamortized debt discount and debt issuance costs	(13,721)		(14,039)
	107,431		106,233

Less: current maturities of long-term debt	(2,246)		(2,242)
Long-term debt	$	105,185	$	103,991

Term Loan, Equipment Loan and Revolver

In April 2019, our wholly-owned subsidiary, Dakota Dry Bean, Inc. (“DDB”) entered into a Credit Agreement comprised of a $14,000 aggregate principal amount of floating rate, five-year term loan (“DDB Term Loan”), a $3,500 floating rate, five-year loan to be used for facility expansion (“DDB Equipment Loan”), and a $6,000 floating rate revolving credit facility (“DDB Revolver”), which is renewed annually (together the “Credit Agreement”). In the fourth quarter of 2022, the DDB Revolver maturity date was extended to November 2023. In the second quarter of 2023, the DDB Term Loan maturity date was extended to April 2025. As of June 30, 2023, the interest rate is U.S. prime rate plus 0.75% on the DDB Term Loan and DDB Equipment Loan, and U.S. prime rate plus 0.25% on the DDB Revolver.

The Credit Agreement is secured by substantially all of DDB’s real and personal property and is guaranteed, in part, by Benson Hill, Inc., DDB’s parent company, to a maximum of $7,000. The DDB Term Loan is payable in equal quarterly installments of $284 plus interest with the remaining balance of $4,834 due in April 2025. The DDB Equipment Loan is payable in equal quarterly installments of $175 plus interest through July 2024.

Under the Credit Agreement, DDB and the Company must comply with certain financial covenants based on DDB’s operations, including a minimum working capital covenant, a minimum net worth covenant, a funded debt to EBITDA ratio covenant, and a fixed charge coverage ratio covenant.

Benson Hill, Inc., as guarantor, must also comply with a minimum cash covenant. The Credit Agreement also contains various restrictions on the Company’s activities, including restrictions on indebtedness, liens, investments, distributions, acquisitions and dispositions, control changes, transactions with affiliates, establishment of bank and brokerage accounts, sale-leaseback transactions, margin stocks, hazardous substances, hedging, and management agreements. During the second quarter of 2023, the Company was in compliance with the financial covenants under the Credit Agreement.

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements (continued)

(Unaudited)

(In Thousands, Except Per Share Data)

Convertible Notes Payable

In December 2021, the Company entered into a financing agreement with an investment firm (the “Convertible Loan and Security Agreement”), which included a commitment by the lender to make term loans available to the Company in an amount of up to $100,000 with $80,000 available immediately. Under the original Convertible Loan and Security Agreement, upon the Company’s achievement of certain milestones, a second tranche of $20,000 became available on June 30, 2022 and the Company could elect to extend the interest-only period from 12 to 24 months and the maturity date by six months as of September 30, 2022.

The Company executed term notes with the lender in December 2021 in the aggregate amount of $80,000 with an initial term of 36 months payable in interest only, at the greater of (a) the prime rate of interest as published in the Wall Street Journal or (b) 3.25% per annum, plus 5.75% per annum for the first 12 months and principal and interest payments for the remaining 24 months. The term notes are secured by substantially all of the Company’s assets.

In June 2022, the Company amended the Convertible Loan and Security Agreement, which changed the definition of gross margin, and modified the Conversion Price and the Exercise Price. The change to the definition of gross margin removed the impact of derivative hedging gains or losses related to future periods and resulted in the Company’s achievement of the milestones required to draw on the second tranche. The Company drew on the full $20,000 available under the second tranche upon entering into this amendment.

In November 2022, the Company entered into a second amendment to the Convertible Loan and Security Agreement, which, among other things, changed the definition of Outstanding Shares based on the updated definition of Market Cap Threshold I. Additionally, the required minimum liquidity covenant requirement was reduced from six months to four months. The second amendment also increased the designated interest rate by 25 basis points. Pursuant to the second amendment, the Company achieved the milestones required to extend the interest-only period from 12 to 24 months and extend the maturity date by six months. This extended the interest-free period through 2023 and the maturity date to July 2025.

In March 2023, the Company entered into a third amendment to the Convertible Loan and Security Agreement (“Third Amendment”), which, among other things, extended the interest-only period for six months through the second quarter of 2024 and allowed the restricted cash to be counted towards the required minimum liquidity covenant calculation. In addition, the Third Amendment increased the final balloon payment by 200 basis points and reset the prime rate floor from 5.75% to 7.75%.

Upon maturity or other satisfaction of the term notes, a final payment (in addition to other payments of principal and interest) equal to $12,700 is payable by the Company to the lenders. In the event the term notes are prepaid, a prepayment fee is due, ranging from 1% to 6% of the principal amount of the term notes, based upon the time from the initial closing to the prepayment date.

At any time after six months and before 42 months from the closing date of the initial term notes, up to $20,000 of the principal amount of the term loans then outstanding may be converted (at the lender’s option) into shares of the Company’s common stock.

The conversion option is subject to: (a) the closing sales price of the Company’s common stock for each of the seven consecutive trading days immediately preceding the conversion, being greater than or equal to the conversion price; (b) the shares of the Company’s common stock issued in connection with any such conversion not exceeding 20% of the total trading volume of the Company’s common stock for the 22 consecutive trading days immediately prior to and including the effective date of the conversion; and (c) all lenders’ pro forma shares of the Company’s Common Stock resulting from the conversion option, when added to all lenders’ pro forma shares of the Company’s common stock resulting from the exercise of the warrants, not exceeding 2.5% of the number of shares of the Company’s common stock outstanding at the time of the conversion.

As of June 30, 2023, the lender has not yet exercised their conversion option for any portion of the outstanding principal. The fair value of the conversion option, estimated at $8,783 at issuance, was recorded as a debt discount, which is amortized over the life of the term notes using the effective interest method and recorded as interest expense.

Under the terms of the Convertible Loan and Security Agreement, the Company must comply with certain affirmative, negative, and financial covenants. These covenants are primarily restrictions on the Company’s activities, including restrictions

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements (continued)

(Unaudited)

(In Thousands, Except Per Share Data)

on indebtedness, liens, dividends, and significant business changes. The Company is required to maintain, at all times, a minimum liquidity equal to or greater than four months. The Company was in compliance with the financial covenants under the Convertible Loan and Security Agreement during the six months ended June 30, 2023.

Equipment Financing

In March 2022, the Company entered into a sale-leaseback transaction relating to certain of the Company’s equipment. The Company evaluated whether the transaction qualified as a sale under ASC 606 and ultimately determined that as the leases are classified as financing leases under ASC 842, the transaction did not qualify as a sale and therefore control of the equipment was not transferred. Therefore, the proceeds from the sales of $1,160 were recorded as a financing liability in 2022. The Company will make monthly payments of $33 under the financing arrangement for a term of 36 months.

10. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consist of the following:


	June 30, 2023		December 31, 2022
Payroll and employee benefits	$	7,156	$	12,306
Insurance premiums	951		4,687
Professional services	1,034		2,842
Research and development	537		924
Inventory	393		530
Interest	129		167
Contract liability	8,305		9,965
Other	3,719		2,014
	$	22,224	$	33,435

11. Income Taxes

The Company’s effective tax rate was 0% for the three and six months ended June 30, 2023, and 2022. The 2023 and 2022 effective tax rates differed from the statutory rate of 21% primarily due to the fact that the Company recorded no income tax benefit on the Company’s pretax losses as the Company recorded a full valuation allowance globally. The tax benefit recorded in 2023 relates primarily to the reversal of deferred tax liabilities due to the impairment of goodwill.

12. Comprehensive Income

The Company’s other comprehensive income (loss) (“OCI”) consists of unrealized gains and losses on marketable debt securities classified as available for sale and foreign currency translation adjustments from its subsidiaries in Brazil and Canada.

The following table shows changes in accumulated other comprehensive income (“AOCI”) by component for the three and six months ended June 30, 2023 and 2022:

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements (continued)

(Unaudited)

(In Thousands, Except Per Share Data)


	Cumulative Foreign Currency Translation		Unrealized Gains/(Losses) on Marketable Securities		Total
Balance as of March 31, 2023	$	(385)	$	(5,854)	$	(6,239)
Other comprehensive income before reclassifications	—		4,662		4,662
Amounts reclassified from AOCI	—		(1,994)		(1,994)
Other comprehensive income	—		2,668		2,668
Balance at June 30, 2023	$	(385)	$	(3,186)	$	(3,571)

Balance at December 31, 2022	$	(385)	$	(6,710)	$	(7,095)
Other comprehensive income before reclassifications	—		6,568		6,568
Amounts reclassified from AOCI	—		(3,044)		(3,044)
Other comprehensive income	—		3,524		3,524
Balance at June 30, 2023	$	(385)	$	(3,186)	$	(3,571)

Balance as of March 31, 2022	$	(441)	$	(3,286)	$	(3,727)
Other comprehensive income (loss) before reclassifications	20		(4,393)		(4,373)
Amounts reclassified from AOCI	—		1,022		1,022
Other comprehensive income (loss)	20		(3,371)		(3,351)
Balance at June 30, 2022	$	(421)	$	(6,657)	$	(7,078)

Balance at December 31, 2021	$	(376)	$	(727)	$	(1,103)
Other comprehensive loss before reclassifications	(45)		(8,159)		(8,204)
Amounts reclassified from AOCI	—		2,229		2,229
Other comprehensive loss	(45)		(5,930)		(5,975)
Balance at June 30, 2022	$	(421)	$	(6,657)	$	(7,078)

Amounts reclassified from AOCI were reported within “Other (income) expense, net” on the condensed consolidated statements of operations. The Company’s accounting policy is to release the income tax effects (if applicable) from AOCI when the individual units of account are sold.

13. Loss Per Common Share

The Company computes basic net income (loss) per common share using the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share is computed using the weighted average number of common shares and the effect of potentially dilutive securities outstanding during the period. Potentially dilutive securities may consist of warrants, stock options and restricted stock units. The dilutive effect of outstanding warrants, stock options and restricted stock units are reflected in diluted earnings per share by application of the treasury stock method. The weighted average share impact of warrants, stock options and restricted stock units that were excluded from the calculation of diluted shares outstanding due to the Company incurring a net loss for the three and six months ended June 30, 2023 and 2022 were as follows:

Table of Contents

Benson Hill, Inc.

Notes to the Condensed Consolidated Financial Statements (continued)

(Unaudited)

(In Thousands, Except Per Share Data)


	Three Months Ended June 30,		Six Months Ended June 30,
	2023	2022	2023	2022
Anti-dilutive common share equivalents:
Warrants	—	—	—	83
Stock options	674	3,813	1,149	4,266
Restricted stock units	9,001	5,285	7,970	4,102
Total anti-dilutive common share equivalents	9,675	9,098	9,119	8,451

The following table sets forth the computation for basic and diluted net loss from continuing operations per common share:


	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Numerator:
Net loss from continuing operations	$	(49,115)	$	(25,098)	$	(53,960)	$	(42,522)
Denominator:

Benson Hill, Inc. [BHIL-WT] Filings
Benson Hill, Inc. [BHIL] Filings
10-Q	[2023-08-09]
10-Q	[2023-05-10]
10-K	[2023-03-16]
10-Q	[2022-11-14]
10-Q	[2022-08-10]
10-Q	[2022-05-16]
S-1	[2022-04-11]
10-K	[2022-03-28]
10-Q	[2021-11-15]
S-1	[2021-10-22]
S-1	[2021-09-21]
10-Q	[2021-08-10]
10-Q	[2021-05-24]
10-K	[2021-03-31]
S-1	[2020-12-18]

Benson Hill, Inc. [BHIL-WT] Filings

Benson Hill, Inc. [BHIL] Filings