BFP-70: The Path Forward, OTC Terms and Timeline

Proposer: Beanstalk Farms

Summary: Approve the following OTC deal terms:

• Beanstalk will borrow up to $77M from lenders in exchange for debt at 500% Weather.
• Lenders will receive a fungible token that earns a pro rata share of one-third of all new Bean mints until the debt is repaid.
• Beanstalk will Unpause after the audits with Halborn and Trail of Bits are complete.

Postpone the start of the Barn Raise until after current OTC negotiations are complete, provided the entire $77M has not been raised.

Proposal: Since the passage of BFP-69, Beanstalk Farms, Bean Sprout and Publius have continued conversations with capital sources about structuring an OTC deal to participate in Beanstalk’s recapitalization. However, Beanstalk needs DAO approval of the OTC transaction terms to begin accepting capital beyond soft commitments.

Furthermore, it has become clear that most investors are interested in recapitalizing Beanstalk under the condition that Beanstalk Unpauses after the audits from Halborn and Trail of Bits are complete. These audits are expected to complete in late June, and Beanstalk could Unpause shortly thereafter in late June or early July. Note, the earliest Beanstalk could Unpause without audits would be early June due to development work.

Thus, the following terms are being proposed: • Beanstalk will borrow up to $77M from lenders in exchange for debt at 500% Weather. • Lenders will receive a fungible token that earns a pro rata share of one-third of new Bean mints until the debt is repaid. • Beanstalk will Unpause after the audits with Halborn and Trail of Bits are complete.

Under these terms, there are confirmed commitments for ~15% of the $77M, and additional capital sources have demonstrated demand in excess of the remaining 85%. The terms outlined above are available to any DAO or outside source of capital that is interested in recapitalizing Beanstalk.

Beanstalk Farms believes that running the Barn Raise in parallel with an OTC deal would be a strategic misstep. Given the level of demand that the OTC structure has garnered thus far, Beanstalk Farms proposes postponing the Barn Raise until after the current negotiations are completed, if the full $77M has not already been raised.

Beanstalk Farms, Bean Sprout and Publius believe that this proposal puts Beanstalk in the best possible position to maximize the amount of liquidity that is recapitalized while delaying the relaunch date by a marginal amount of time.