Local Bounti Corporation/DE

Previous wording

U.S. Bounti, LLC (“U.S. Bounti”), following conversion of our Series A Preferred Stock, will control the direction of our business and the concentrated ownership of our common stock will prevent other stockholders from influencing significant decisions.

Current wording

U.S. Bounti, LLC (“U.S. Bounti”), following conversion of our Series A Preferred Stock, controls the direction of our business and the concentrated ownership of our common stock may prevent other stockholders from influencing significant decisions.

Previous wording

U.S. Bounti, an entity controlled by Charles R. Schwab, will hold the voting power over approximately 56.2% of our outstanding common stock following the conversion of our Series A Preferred Stock upon removal of the current conversion blocker for NYSE change of control rule purposes (the "Conversion Blocker"). The removal of the Conversion Blocker is subject to approval by our stockholders at our upcoming annual stockholders’ meeting to be held on June 11, 2025. Once the Conversion Block is removed and the Series A Preferred Stock is converted to common stock, Mr. Schwab, through his control of other entities which also hold shares of our common stock, will beneficially own approximately 61.5% of our outstanding common stock. Mr. Schwab, through his control of U.S. Bounti and other entities holding shares of our common stock, will be able to significantly influence our decisions, including the election of directors (and U.S. Bounti has the right to appoint two of our directors), and the approval of significant corporate transactions, such as mergers and related party transactions. Mr. Schwab, through his control of U.S. Bounti and other entities holding shares of our common stock, will also have the ability to delay or block, by ownership of our common stock, an unsolicited tender offer. This concentration of ownership could have the effect of delaying, deterring or preventing a change in control of the Company that stockholders might view favorably. Additionally, U.S. Bounti’s interests may not align with the interests of our other stockholders. U.S. Bounti may make investments in companies and may acquire and hold interests in businesses that compete directly or indirectly with us and may also pursue acquisition opportunities that may be complementary to our business, and, as a result, those acquisition opportunities may not be available to us.

Current wording

Following the conversion of our Series A Preferred Stock into common stock at the annual stockholders’ meeting held on June 11, 2025, U.S. Bounti, an entity controlled by Charles R. Schwab, holds the voting power over approximately 55% of our outstanding common stock Mr. Schwab, through his control of other entities which also hold shares of our common stock, beneficially owns approximately 60% of our outstanding common stock. Mr. Schwab, through his control of U.S. Bounti and other entities holding shares of our common stock, is able to significantly influence our decisions, including the election of directors (and U.S. Bounti has the right to appoint two of our directors), and the approval of significant corporate transactions, such as mergers and related party transactions. Mr. Schwab, through his control of U.S. Bounti and other entities holding shares of our common stock, also has the ability to delay or block, by ownership of our common stock, an unsolicited tender offer. This concentration of ownership could have the effect of delaying, deterring or preventing a change in control of the Company that stockholders might view favorably. Additionally, U.S. Bounti’s interests may not align with the interests of our other stockholders. U.S. Bounti may make investments in companies and may acquire and hold interests in businesses that compete directly or indirectly with us and may also pursue acquisition opportunities that may be complementary to our business, and, as a result, those acquisition opportunities may not be available to us.

Previous wording

Although we do not expect to rely on the "controlled company" exemption, we may soon become a "controlled company" within the meaning of the NYSE rules, and we would qualify for exemptions from certain corporate governance requirements.

Current wording

Although we do not expect to rely on the "controlled company" exemption, we qualify as a "controlled company" within the meaning of the NYSE rules, and we qualify for exemptions from certain corporate governance requirements.

Previous wording

Upon the conversion of the Series A Preferred Stock owned by U.S. Bounti, we would meet the definition of a "controlled company." As a result, these requirements would not apply to us as long as we remain a "controlled company."

Current wording

Charles R. Schwab, through his control of entities which also hold shares of our common stock, beneficially owns approximately 60% of our outstanding common Because Mr. Schwab beneficially owns a majority of the voting power for the election of our directors, and we meet the definition of a “controlled company,” these requirements would not apply to us as long as we remain a "controlled company."

Previous wording

Although we may soon qualify as a "controlled company," we currently do not, and we do not expect to, rely on this exemption and we currently comply with, and we expect to continue to comply with, all relevant corporate governance requirements under the NYSE rules. However, if we were to utilize some or all of these exemptions, our stockholders may not have the same protections afforded to stockholders of companies that are subject to all of the NYSE continued listing standards that relate to corporate governance.

Current wording

We currently do not, and we do not expect to, rely on this exemption and we currently comply with, and we expect to continue to comply with, all relevant corporate governance requirements under the NYSE rules. However, if we were to utilize some or all of these exemptions, our stockholders may not have the same protections afforded to stockholders of companies that are subject to all of the NYSE continued listing standards that relate to corporate governance.