2 ballot items.
Stockholders are being asked to approve NYSE-related issuances of common stock to U.S. Bounti under a convertible note and warrant transaction and to authorize adjournment of the Special Meeting to solicit additional proxies if needed.
Approve, for purposes of NYSE rules and the Purchase Agreement, the issuance of up to 12,563,309 shares of common stock upon conversion of the $12.5 million convertible note issued to U.S. Bounti, LLC and up to 1,000,000 shares underlying the warrant issued to U.S. Bounti.
Proposal 1 asks stockholders to approve the issuance of up to 12,563,309 common shares issuable on conversion of Local Bounti’s convertible note held by U.S. Bounti and up to 1,000,000 shares issuable on exercise of U.S. Bounti’s warrant. The securities were issued under an August 7, 2026 Convertible Note and Warrant Purchase Agreement for a combined purchase price of $12.5 million. The note initially carries a $1.37 conversion price, bears 7% interest that generally compounds through PIK interest, and may convert over time, while the warrant is immediately exercisable at $0.125 per share and expires ten years after its initial exercise date. NYSE approval is required because U.S. Bounti is treated as an Active Related Party, the potential issuance exceeds the NYSE’s 1% Active Related Party Cap, and the conversion and exercise prices were below the applicable NYSE Minimum Price. The Purchase Agreement independently requires the Company to seek stockholder approval and to hold additional special meetings every four months if approval is not obtained. Approval would remove the contractual Exchange Cap, permitting U.S. Bounti to receive the full authorized amount without another stockholder vote, whereas rejection would limit issuances exceeding 1% and impose recurring solicitation costs. The potential issuance could materially dilute existing stockholders’ percentage ownership, book value per share, and future earnings per share, and resale registration or substantial sales could pressure the trading price. U.S. Bounti is the Company’s majority stockholder, and Charles R. Schwab controls U.S. Bounti and is reported as beneficially owning 74.3% of the Company, creating a significant related-party and control context. The Board unanimously recommends voting FOR because it views approval as in the Company’s and stockholders’ best interests and because approval is necessary to satisfy NYSE and contractual requirements.
Approve adjournment of the Special Meeting, if necessary or appropriate, to allow the Board to solicit additional proxies if there are insufficient votes to approve the NYSE Approval Proposal.
Proposal 2 asks stockholders to authorize the Board to adjourn the Special Meeting if additional time is needed to obtain votes supporting the NYSE Approval Proposal. The authority would be used only if the NYSE Approval Proposal lacks sufficient support at the time of the meeting and the Board determines an adjournment is necessary or appropriate. If approved, the Board could reconvene the meeting on a later date and use the intervening period to solicit additional proxies. The Company may seek votes from stockholders who have not voted as well as from stockholders who previously voted against Proposal 1. Stockholders who already submitted proxies would not need to submit new ones unless they want to change their instructions, and they could revoke proxies before their use at the adjourned meeting. The Company does not intend to call a vote on Proposal 2 if Proposal 1 has already been approved. Management argues that a limited adjournment is in stockholders’ best interests because it could prevent the NYSE Approval Proposal from failing solely because insufficient votes were obtained by the initial meeting date. The Board recommends voting FOR Proposal 2 and states that approval requires a majority of votes cast affirmatively. Like Proposal 1, abstentions and broker non-votes are described as having no effect on the result, and the proposal is classified as non-routine.
| # | Owner | % of shares | Shares | Value |
|---|---|---|---|---|
| 1 | Cresset Asset Management, LLC | 0.91% | 213,036 | $275K |
| 2 | BBR PARTNERS, LLC | 0.83% | 194,696 | $251K |
| 3 | VANGUARD CAPITAL MANAGEMENT LLC | 0.81% | 189,080 | $244K |
| 4 | FMR LLC | 0.51% | 118,993 | $154K |
| 5 | SCHWARZ DYGOS WHEELER INVESTMENT ADVISORS LLC | 0.43% | 99,455 | $128K |
| 6 | OUTFITTERS FINANCIAL LLC | 0.17% | 39,291 | $51K |
| 7 | GEODE CAPITAL MANAGEMENT, LLC | 0.16% | 37,686 | $49K |
| 8 | STATE STREET CORP | 0.15% | 33,980 | $44K |
| 9 | PINNACLE ASSOCIATES LTD | 0.13% | 30,845 | $40K |
| 10 | BlackRock, Inc. | 0.12% | 27,510 | $35K |
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