SCHEDULE: Activist Group Discloses 7.3% Stake in LM Funding America

A group of investors led by Milton C. Ault, III, including Hyperscale Data, Inc. and Ault Capital Group, Inc., has disclosed a 7.3% beneficial ownership stake in LM Funding America, Inc., intending to engage with management to enhance stockholder value.

Summary

• A group of seven reporting persons, including Hyperscale Data, Inc., Alpha Structured Finance LP, Ault Lending, LLC, and Milton C. Ault, III, has collectively acquired beneficial ownership of 891,428 shares of LM Funding America, Inc. common stock.
• This represents approximately 7.3% of LM Funding America, Inc.'s 12,209,413 outstanding shares as of November 11, 2025.
• The shares were acquired through open market purchases using working capital, with Alpha Fund spending $167,963 for 185,000 shares and Ault Lending spending $811,749.40 for 706,428 shares.
• The Reporting Persons intend to engage in discussions with LM Funding America's board and management to explore opportunities for enhancing stockholder value.
• Future actions may include increasing or decreasing their position, proposing changes to capitalization, ownership, or Board structure, and discussing potential business combinations or dispositions.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive due to the activist nature of the filing, indicating an investor group sees potential for value creation and intends to engage with management. While there are no explicit financial positives for the issuer, the intent to enhance shareholder value is generally viewed favorably by the market.

Positives

• A significant investor group has taken a substantial stake, indicating potential belief in the company's undervalued status or future prospects.
• The stated intention to engage with management to enhance stockholder value suggests a proactive approach to improving company performance and shareholder returns.
• The group's diverse business interests (AI data centers, Bitcoin, diversified holding company, commercial lending, investment management) could bring varied expertise to LM Funding America.

Risks

• The Reporting Persons may increase or decrease their position, which could lead to volatility in LM Funding America's stock price.
• The Reporting Persons may engage in short selling or hedging transactions, which could exert downward pressure on the stock.
• Discussions with management and the board may not result in agreed-upon strategies for enhancing stockholder value.
• Potential proposals for changes to capitalization, ownership structure, or Board composition could lead to internal disagreements or disruptions.

Future Outlook

The Reporting Persons intend to review their investment in LM Funding America on a continuing basis and may take various actions in the future, including increasing or decreasing their stake, engaging in further discussions with management and the Board, and proposing changes to the company's capitalization, ownership, or Board structure to enhance stockholder value. They also mentioned potential business combinations or dispositions involving the Issuer.

Management Comments

• The Reporting Persons intend to engage in discussions with LM Funding America's board of directors and management team regarding opportunities for the Issuer to enhance stockholder value.
• The Reporting Persons do not have any present plan or proposal which would relate to or result in any of the matters set forth in subparagraphs (a) (j) of Item 4 of Schedule 13D except as set forth herein or such as would occur upon or in connection with completion of, or following, any of the actions discussed herein.

Industry Context

This filing indicates an activist investment in LM Funding America, Inc., a common occurrence in the financial industry where investors seek to unlock value in companies they perceive as undervalued or underperforming. The involvement of entities like Hyperscale Data, Inc. (an AI data center company anchored by Bitcoin) and Ault Capital Group (a diversified holding company) suggests a potential interest in leveraging LM Funding America's assets or operations within broader technology or diversified investment strategies, or simply a belief in the company's intrinsic value.

Corporate Governance

Stakeholder Impact

• Shareholders: Potential for increased shareholder value if the activist engagement is successful. Could also lead to stock price volatility due to the group's buying/selling activities or proposed changes.
• Management/Board: Will likely face increased scrutiny and pressure to consider the Reporting Persons' proposals for strategic and governance changes.
• Employees, Customers, Suppliers, Creditors: Potential indirect impact if strategic changes (e.g., business combinations, dispositions, operational improvements) are implemented, but no direct impact is specified in the filing.

Next Steps

• Reporting Persons may increase or decrease their position in LM Funding America, Inc.
• Reporting Persons intend to engage in discussions with LM Funding America's board of directors and management team regarding opportunities to enhance stockholder value.
• Reporting Persons may make recommendations or proposals to the Issuer concerning changes to capitalization, ownership structure, Board structure (including composition), or suggestions for improving financial and/or operational performance.
• Reporting Persons may engage in discussions with other stockholders or third parties about the Issuer, including potential business combinations or dispositions.

Key Dates

Recommendation

The disclosure of a significant activist stake by a group of investors, including Milton C. Ault, III, suggests potential for future strategic changes and value creation at LM Funding America, Inc. The stated intent to engage with management to enhance stockholder value is a positive signal. However, the specific outcomes of these engagements are uncertain, and the group's past trading activity includes both purchases and sales, indicating a dynamic approach. Investors should 'hold' to monitor the developments of this activist engagement and assess the feasibility and impact of any proposed changes before making further investment decisions.

Keywords

LM Funding America, Schedule 13D, Activist Investor, Shareholder Value, Hyperscale Data, Ault Capital Group, Milton C. Ault III, Common Stock, Beneficial Ownership, Investment Management, Corporate Governance