Local Bounti Seeks Shareholder Nod for $10M U.S. Bounti Equity Deal

TL;DR

**Vote FOR the NYSE Approval Proposal; it's a necessary step to secure critical funding from their majority owner, despite the dilution.**

AI Summary

Local Bounti Corporation (LOCLW) is holding a Special Meeting on October 14, 2025, to seek stockholder approval for the issuance of up to 5,131,871 shares of common stock upon the conversion of a convertible note and up to 550,000 shares of common stock underlying a warrant, both issued to U.S. Bounti, LLC. This transaction, governed by a Convertible Note and Warrant Purchase Agreement dated August 1, 2025, requires NYSE stockholder approval because U.S. Bounti is a majority stockholder and an 'Active Related Party,' and the total shares to be issued exceed 1% of the 22,103,180 common shares outstanding before the agreement. Furthermore, the initial conversion price of the note at $2.50 per share and the warrant exercise price of $0.125 per share were below the NYSE 'Minimum Price.' If approved, U.S. Bounti can convert the note and exercise the warrant without further stockholder approval. If not approved, Local Bounti will be unable to issue shares exceeding the 1% threshold to U.S. Bounti, impacting the terms of the Purchase Agreement.

Why It Matters

This DEF 14A filing is crucial for Local Bounti as it seeks to ratify a significant financing deal with its majority stockholder, U.S. Bounti, involving a $10.0 million convertible note and warrants. For investors, approval means potential dilution from the issuance of up to 5,681,871 new shares, but also signals continued financial support from a key stakeholder. Failure to approve could disrupt the Purchase Agreement, potentially impacting the company's liquidity and future growth plans in the competitive controlled environment agriculture market. The transaction's terms, with conversion and exercise prices below NYSE's 'Minimum Price,' highlight the company's need for capital and the influence of its majority owner.

Risk Assessment

Risk Level: medium — The risk level is medium because failure to approve the NYSE Approval Proposal could prevent Local Bounti from issuing up to 5,681,871 shares to U.S. Bounti, potentially jeopardizing the Convertible Note and Warrant Purchase Agreement. This could impact the company's financial stability, as the $10.0 million convertible note is a significant capital infusion. The issuance itself also carries dilution risk for existing shareholders.

Analyst Insight

Investors should vote 'FOR' the NYSE Approval Proposal to ensure Local Bounti can proceed with the financing from U.S. Bounti, which appears critical for the company's operations. While dilution is a concern, the capital infusion from the $10.0 million convertible note is likely more beneficial than the consequences of the deal falling through.

Key Numbers

• $10.0M — Convertible Note Principal (Issued to U.S. Bounti, LLC on August 1, 2025)
• 5,131,871 — Conversion Shares (Maximum shares issuable from convertible note to U.S. Bounti)
• 550,000 — Warrant Shares (Maximum shares issuable from warrant to U.S. Bounti)
• $2.50 — Note Conversion Price (Below NYSE Minimum Price)
• $0.125 — Warrant Exercise Price (Below NYSE Minimum Price)
• 22,103,180 — Shares Outstanding (Immediately before the Purchase Agreement closing, 1% threshold exceeded)
• October 14, 2025 — Special Meeting Date (Date for stockholder vote on NYSE Approval Proposal)
• August 22, 2025 — Record Date (Date for determining stockholders eligible to vote)

Key Players & Entities

• Local Bounti Corporation (company) — Registrant seeking stockholder approval
• U.S. Bounti, LLC (company) — Majority stockholder and recipient of convertible note and warrant
• New York Stock Exchange (regulator) — Exchange requiring stockholder approval for the transaction
• Margaret McCandless (person) — Corporate Secretary of Local Bounti Corporation
• Kathleen Valiasek (person) — President, CEO, and CFO of Local Bounti Corporation
• $10.0 million (dollar_amount) — Initial principal balance of the convertible note
• 5,131,871 (dollar_amount) — Maximum shares of common stock issuable upon conversion of the note
• 550,000 (dollar_amount) — Maximum shares of common stock underlying the warrant
• $2.50 (dollar_amount) — Initial conversion price per share of common stock for the note
• $0.125 (dollar_amount) — Exercise price per share of common stock for the warrant

FAQ

Risk Factors

• NYSE Stockholder Approval for Share Issuance [high — regulatory]: The company requires NYSE stockholder approval to issue up to 5,131,871 shares from a convertible note and 550,000 shares from a warrant to U.S. Bounti, LLC. This is because U.S. Bounti is a majority stockholder and an 'Active Related Party,' and the total shares to be issued exceed 1% of the 22,103,180 shares outstanding. The conversion price of $2.50 and warrant exercise price of $0.125 are below the NYSE 'Minimum Price,' necessitating this approval.
• Reliance on Convertible Note and Warrant Financing [medium — financial]: The company has entered into a Convertible Note and Warrant Purchase Agreement with U.S. Bounti, LLC for $10.0M. The terms of this agreement, including the ability to issue shares upon conversion and exercise, are contingent on NYSE stockholder approval. Failure to obtain approval could impact the company's ability to raise capital or meet its obligations under the agreement.

Industry Context

Local Bounti operates in the controlled environment agriculture (CEA) sector, focusing on indoor farming. This industry is characterized by increasing demand for locally sourced, sustainable produce, but also faces challenges related to high initial capital investment, energy costs, and competition from traditional agriculture and other CEA players.

Regulatory Implications

The primary regulatory implication is the need for NYSE stockholder approval due to the transaction's size and the related party nature of U.S. Bounti, LLC. Failure to secure this approval could lead to non-compliance with NYSE listing standards and impact the company's financing arrangements.

What Investors Should Do

1. Vote FOR the NYSE Approval Proposal
2. Review the terms of the Convertible Note and Warrant Purchase Agreement
3. Attend the Special Meeting or submit proxy

Key Dates

• 2025-10-14: Special Meeting of Stockholders — Stockholders will vote on the NYSE Approval Proposal to issue shares related to the convertible note and warrant with U.S. Bounti, LLC.
• 2025-08-22: Record Date — Determines which stockholders are eligible to vote at the Special Meeting.
• 2025-08-01: Convertible Note and Warrant Purchase Agreement — Agreement entered into with U.S. Bounti, LLC for $10.0M, outlining terms for convertible note and warrant issuance.
• 2025-08-25: Mailing of Notice of Internet Availability of Proxy Materials — Initiates the formal notification process for stockholders regarding the upcoming Special Meeting and proxy materials.

Glossary

DEF 14A

A proxy statement filing required by the SEC for companies holding annual or special meetings of shareholders. (This document contains the information and proposals being presented to shareholders for a vote at the Special Meeting.)

Convertible Note

A debt instrument that can be converted into a predetermined amount of equity (common stock) at the option of the holder. (Local Bounti is seeking approval to issue shares upon the conversion of a $10.0M convertible note issued to U.S. Bounti, LLC.)

Warrant

A security that gives the holder the right, but not the obligation, to purchase a company's stock at a specified price (exercise price) within a certain timeframe. (Local Bounti is seeking approval to issue shares underlying a warrant issued to U.S. Bounti, LLC.)

Active Related Party

A term used in NYSE rules to identify parties with a significant relationship to the company, often requiring special approval for transactions. (U.S. Bounti, LLC is identified as an 'Active Related Party,' triggering the need for NYSE stockholder approval for the share issuance.)

Minimum Price

The minimum price per share at which a company's stock can be issued or sold without requiring special stockholder approval under NYSE rules. (The conversion price ($2.50) and warrant exercise price ($0.125) are below the NYSE 'Minimum Price,' necessitating the current stockholder vote.)

Year-Over-Year Comparison

This filing is a proxy statement for a special meeting, not an annual report. Therefore, direct year-over-year comparisons of financial metrics like revenue, net income, or margins are not available within this document. The focus is on a specific transaction requiring stockholder approval, rather than a comprehensive review of past financial performance.

Key Financial Figures

• $0.0001 — 1 shares of our common stock, par value $0.0001 per share (the "common stock"), upon th
• $10.0 million — te with an initial principal balance of $10.0 million (the "Note") and (ii) a common stock pu
• $2.50 — initial conversion price of the Note is $2.50 per share of common stock (the "Convers
• $0.125 — ble immediately at an exercise price of $0.125 per share of common stock (the "Exercis

Filing Documents

• ny20053663x2_def14a.htm (DEF 14A) — 651KB
• ny20053663x2-pc_1.jpg (GRAPHIC) — 604KB
• ny20053663x2-pc_2.jpg (GRAPHIC) — 478KB
• sig_margaretmccandless.jpg (GRAPHIC) — 22KB
• 0001140361-25-032530.txt ( ) — 2172KB

Security Ownership of Certain Beneficial Owners and Management

Security Ownership of Certain Beneficial Owners and Management 12 Where You Can Find More Information 14 Other Matters 14 i TABLE OF CONTENTS Local Bounti Corporation 490 Foley Lane, Hamilton, MT 59840 Proxy Statement for Special Meeting of Stockholders The Board of Directors (the "Board") of Local Bounti Corporation, a Delaware corporation ("Local Bounti," the "Company," "we," "us," or "our"), is soliciting your proxy to vote at a special meeting of stockholders (the "Special Meeting") of Local Bounti to be held exclusively via live audiocast at virtualshareholdermeeting.com/LOCL2025SM on October 14, 2025, at 9 a.m. Mountain Time, including at any adjournments or postponements of the Special Meeting. The Special Meeting will be held in a virtual-only format. You are invited to attend and vote your shares electronically at the Special Meeting and submit questions by following the instructions available on the meeting website. You are encouraged to log in to the website above before the Special Meeting begins. Online check-in will be available approximately 15 minutes before the meeting starts. If you encounter any difficulties accessing or participating in the Special Meeting through the meeting website, please call the support team at the number listed on the website log-in screen. Under the rules of the Securities and Exchange Commission (the "SEC"), we have elected to provide access to our proxy materials by notifying you of the availability of our proxy materials on the internet. On or about August 25, 2025, we will begin mailing the Notice of Internet Availability of Proxy Materials to our stockholders of record and beneficial owners as of the record date. You do not need to attend the Special Meeting via live audiocast to vote your shares. Instead, you may vote your shares by proxy via the internet or by completing, signing, and returning the enclosed proxy card. Questions and Answers Why have I received these materials? The Board is so

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View this DEF 14A filing on SEC EDGAR