SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
SCHEDULE 13D
(Rule 13d-101)
(Amendment No. 1)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED
PURSUANT TO § 240.13d-1(a) AND
AMENDMENTS THERETO FILED PURSUANT TO § 240.13d-2(a)
RiceBran Technologies, Inc.
(Name of Issuer)
Common Stock, no par value per share
(Title of Class of Securities)
45677V108
(CUSIP Number)
LF-RB Management LLC | Stephen D. Baksa | |
720 Fifth Avenue, 10th Floor | 2 Woods Lane | |
New York, New York 10019 | Chatham, NJ 45140 | |
(212) 247-0581 | (973) 635-4710 |
(Name, Address and Telephone Number of Person Authorized to Receive Notices and
Communications)
May 18, 2016
(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. ¨
Note. Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See § 240.13d-7 for other parties to whom copies are to be sent.
(Continued on following pages)
Page 1 of 11 pages
CUSIP No. 45677V108 | 13D | Page 2 of 11 Pages |
1 |
NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY)
LF-RB Management, LLC |
81-1110072 |
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP | (a) x (b) ¨ | |
3 | SEC USE ONLY | ||
4 |
SOURCE OF FUNDS WC | ||
5 | CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) | ¨ | |
6 |
CITIZENSHIP OR PLACE OF ORGANIZATION Delaware |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH |
7 |
SOLE VOTING POWER 0 shares | |
8 |
SHARED VOTING POWER 952,479 shares | ||
9 |
SOLE DISPOSITIVE POWER 0 shares | ||
10 |
SHARED DISPOSITIVE POWER 0 shares |
11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 952,479 shares1 | ||
12 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES | ¨ | |
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 | 9.0%2 | |
14 | TYPE OF REPORTING PERSON | OO |
1 LF-RB Management, LLC may be deemed to have shared voting power with respect to, and beneficial ownership of, the shares of Common Stock (“Common Stock”) of the Issuer held by the other parties to such Voting Agreement, Stephen D. Baksa and Edward M. Giles under Rule 13d-5 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), by virtue of the Voting Agreement (as defined and described in item 4 below) and the other understandings described in Items 4 and 6 below.
2 Based on a total of 10,496,339 shares of Common Stock issued and outstanding as of May 13, 2016, as reported by the Issuer in the Issuer’s latest Quarterly Report on Form 10-Q, as filed with the Securities and Exchange Commission on May 16, 2016, plus 139,047 shares of Common Stock underlying warrants held by Mr. Baksa exercisable within 60 days of the date hereof.
CUSIP No. 45677V108 | 13D | Page 3 of 11 Pages |
1 |
NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY)
Gary L. Herman |
N/A |
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP | (a) x (b) ¨ | |
3 | SEC USE ONLY | ||
4 |
SOURCE OF FUNDS PF | ||
5 | CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) | ¨ | |
6 |
CITIZENSHIP OR PLACE OF ORGANIZATION United States |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH |
7 |
SOLE VOTING POWER 0 shares | |
8 |
SHARED VOTING POWER 952,479 shares | ||
9 |
SOLE DISPOSITIVE POWER 3,390 shares | ||
10 |
SHARED DISPOSITIVE POWER 0 shares |
11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 952,479 shares3 | ||
12 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES | ¨ | |
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 | 9.0%4 | |
14 | TYPE OF REPORTING PERSON | IN |
3 Includes 3,390 shares directly held by Gary L. Herman and his affiliates. Mr. Herman, as managing member of LF-RB Management LLC, may be deemed to have shared voting power with respect to, and beneficial ownership of, the shares of Common Stock of the Issuer held by him, the other parties to the Voting Agreement, Stephen D. Baksa and Edward M. Giles under Rule 13d-5 of the Exchange Act, by virtue of the Voting Agreement and the other understandings described in Items 4 and 6 below.
4 Based on a total of 10,496,339 shares of Common Stock issued and outstanding as of May 13, 2016, as reported by the Issuer in the Issuer’s latest Quarterly Report on Form 10-Q, as filed with the Securities and Exchange Commission on May 16, 2016, plus 139,047 shares of Common Stock underlying warrants held by Mr. Baksa exercisable within 60 days of the date hereof.
CUSIP No. 45677V108 | 13D | Page 4 of 11 Pages |
1 |
NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY)
Michael Goose |
N/A |
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP | (a) x (b) ¨ | |
3 | SEC USE ONLY | ||
4 |
SOURCE OF FUNDS PF | ||
5 | CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) | ¨ | |
6 |
CITIZENSHIP OR PLACE OF ORGANIZATION Canada |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH |
7 |
SOLE VOTING POWER 0 shares | |
8 |
SHARED VOTING POWER 952,479 shares | ||
9 |
SOLE DISPOSITIVE POWER 0 shares | ||
10 |
SHARED DISPOSITIVE POWER 0 shares |
11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 952,479 shares5 | ||
12 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES | ¨ | |
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 | 9.0%6 | |
14 | TYPE OF REPORTING PERSON | IN |
5 Mr. Goose, as managing member of LF-RB Management LLC, may be deemed to have shared voting power with respect to, and beneficial ownership of, the shares of Common Stock of the Issuer held by the other parties to the Voting Agreement, Stephen D. Baksa and Edward M. Giles under Rule 13d-5 of the Exchange Act, by virtue of the Voting Agreement and the other understandings described in Items 4 and 6 below
6 Based on a total of 10,496,339 shares of Common Stock issued and outstanding as of May 13, 2016, as reported by the Issuer in the Issuer’s latest Quarterly Report on Form 10-Q, as filed with the Securities and Exchange Commission on May 16, 2016, plus 139,047 shares of Common Stock underlying warrants held by Mr. Baksa exercisable within 60 days of the date hereof.
CUSIP No. 45677V108 | 13D | Page 5 of 11 Pages |
1 |
NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY)
Stephen D. Baksa |
N/A |
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP | (a) x (b) ¨ | |
3 | SEC USE ONLY | ||
4 |
SOURCE OF FUNDS PF | ||
5 | CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) | ¨ | |
6 |
CITIZENSHIP OR PLACE OF ORGANIZATION United States |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH |
7 |
SOLE VOTING POWER 0 shares | |
8 |
SHARED VOTING POWER 496,910 shares | ||
9 |
SOLE DISPOSITIVE POWER 496,910 shares | ||
10 |
SHARED DISPOSITIVE POWER 0 shares |
11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 496,910 shares7 | ||
12 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES | ¨ | |
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 | 4.7%8 | |
14 | TYPE OF REPORTING PERSON | IN |
7 Represents an aggregate of 357,863 shares of the Issuer’s Common Stock and 139,047 shares of Common Stock underlying Common Stock purchase warrants exercisable within 60 days. This total does not include 51,233 shares of Common Stock owned by trusts for the benefit of Mr. Baksa’s adult children. Mr. Baksa’s wife is the sole trustee of such trusts, and Mr. Baksa disclaims beneficial ownership of such shares. LF-RB Management, LLC may be deemed to have shared voting power with respect to, and beneficial ownership of, the shares of Common Stock of the Issuer held by Mr. Baksa under Rule 13d-5 of the Exchange Act by virtue of the understandings described in Items 4 and 6 below.
8 Based on a total of 10,496,339 shares of Common Stock issued and outstanding as of May 13, 2016, as reported by the Issuer in the Issuer’s latest Quarterly Report on Form 10-Q, as filed with the Securities and Exchange Commission on May 16, 2016, plus 139,047 shares of Common Stock underlying warrants held by Mr. Baksa exercisable within 60 days of the date hereof.
CUSIP No. 45677V108 | 13D | Page 6 of 11 Pages |
1 |
NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY)
Richard Jacinto |
N/A |
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP | (a) x (b) ¨ | |
3 | SEC USE ONLY | ||
4 |
SOURCE OF FUNDS PF | ||
5 | CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) | ¨ | |
6 |
CITIZENSHIP OR PLACE OF ORGANIZATION United States |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH |
7 |
SOLE VOTING POWER 0 shares | |
8 |
SHARED VOTING POWER 144,551 shares | ||
9 |
SOLE DISPOSITIVE POWER 144,551 shares | ||
10 |
SHARED DISPOSITIVE POWER 0 shares |
11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 144,551 shares9 | ||
12 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES | ¨ | |
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 | 1.4%10 | |
14 | TYPE OF REPORTING PERSON | IN |
9 Includes only shares of Common Stock directly held by Richard Jacinto Roth IRA. LF-RB Management, LLC may be deemed to have shared voting power with respect to, and beneficial ownership of, the shares of Common Stock of the Issuer held by Mr. Jacinto under Rule 13d-5 of the Exchange Act by virtue of the Voting Agreement described in Items 4 and 6 below.
10 Based on a total of 10,496,339 shares of Common Stock issued and outstanding as of May 13, 2016, as reported by the Issuer in the Issuer’s latest Quarterly Report on Form 10-Q, as filed with the Securities and Exchange Commission on May 16, 2016.
CUSIP No. 45677V108 | 13D | Page 7 of 11 Pages |
1 |
NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY)
Richard Bellofatto |
N/A |
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP | (a) x (b) ¨ | |
3 | SEC USE ONLY | ||
4 |
SOURCE OF FUNDS PF | ||
5 | CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) | ¨ | |
6 |
CITIZENSHIP OR PLACE OF ORGANIZATION United States |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH |
7 |
SOLE VOTING POWER 0 shares | |
8 |
SHARED VOTING POWER 150,000 shares | ||
9 |
SOLE DISPOSITIVE POWER 150,000 shares | ||
10 |
SHARED DISPOSITIVE POWER 0 shares |
11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 150,000 shares11 | ||
12 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES | ¨ | |
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 | 1.4%12 | |
14 | TYPE OF REPORTING PERSON | IN |
11 . Includes only shares directly held by Richard Bellofatto. LF-RB Management, LLC may be deemed to have shared voting power with respect to, and beneficial ownership of, the shares of Common Stock of the Issuer held by Mr. Bellofatto under Rule 13d-5 of the Exchange Act by virtue of the Voting Agreement described in Items 4 and 6 below.
12 Based on a total of 10,496,339 shares of Common Stock issued and outstanding as of May 13, 2016, as reported by the Issuer in the Issuer’s latest Quarterly Report on Form 10-Q, as filed with the Securities and Exchange Commission on May 16, 2016.
CUSIP No. 45677V108 | 13D | Page 8 of 11 Pages |
1 |
NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY)
Larry Hofpspirger |
N/A |
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP | (a) x (b) ¨ | |
3 | SEC USE ONLY | ||
4 |
SOURCE OF FUNDS PF | ||
5 | CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) | ¨ | |
6 |
CITIZENSHIP OR PLACE OF ORGANIZATION United States |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH |
7 |
SOLE VOTING POWER 0 shares | |
8 |
SHARED VOTING POWER 115,148 shares | ||
9 |
SOLE DISPOSITIVE POWER 115,148 shares | ||
10 |
SHARED DISPOSITIVE POWER 0 shares |
11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 115,148 shares13 | ||
12 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES | ¨ | |
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 | 1.1%14 | |
14 | TYPE OF REPORTING PERSON | IN |
13 Includes only shares directly held by Larry Hofpspirger. LF-RB Management, LLC may be deemed to have shared voting power with respect to, and beneficial ownership of, the shares of Common Stock of the Issuer held by Mr. Hofpspirger under Rule 13d-5 of the Exchange Act by virtue of the Voting Agreement described in Items 4 and 6 below.
14 Based on a total of 10,496,339 shares of Common Stock issued and outstanding as of May 13, 2016, as reported by the Issuer in the Issuer’s latest Quarterly Report on Form 10-Q, as filed with the Securities and Exchange Commission on May 16, 2016.
CUSIP No. 45677V108 | 13D | Page 9 of 11 Pages |
1 |
NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY)
Edward M. Giles |
N/A |
2 | CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP | (a) x (b) ¨ | |
3 | SEC USE ONLY | ||
4 |
SOURCE OF FUNDS PF | ||
5 | CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) | ¨ | |
6 |
CITIZENSHIP OR PLACE OF ORGANIZATION United States |
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH |
7 |
SOLE VOTING POWER 0 shares | |
8 |
SHARED VOTING POWER 42,280 shares | ||
9 |
SOLE DISPOSITIVE POWER 42,280 shares | ||
10 |
SHARED DISPOSITIVE POWER 0 shares |
11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 42,280 shares15 | ||
12 | CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES | ¨ | |
13 | PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 | 0.4%16 | |
14 | TYPE OF REPORTING PERSON | IN |
15 LF-RB Management, LLC may be deemed to have shared voting power with respect to, and beneficial ownership of, the shares of Common Stock of the Issuer held by Mr. Giles under Rule 13d-5 of the Exchange Act by virtue of the understandings described in Items 4 and 6 below.
16 Based on a total of 10,496,339 shares of Common Stock issued and outstanding as of May 13, 2016, as reported by the Issuer in the Issuer’s latest Quarterly Report on Form 10-Q, as filed with the Securities and Exchange Commission on May 16, 2016.
EXPLANATORY NOTE
This Amendment No. 1 to Schedule 13D (this “Amendment No. 1”) amends and supplements the Schedule 13D (the “Original Schedule 13D”) filed by the Reporting Persons with the Securities and Exchange Commission on April 29, 2016 as specifically set forth herein. This Amendment No. 1 is being filed by the Reporting Persons with a letter sent to the Issuer dated May 17, 2016. Capitalized terms used but not defined in this Amendment No. 1 have the meanings given to such terms in the Original Schedule 13D.
Item 4. | Purpose of Transaction. |
Item 4 is hereby amended and supplemented by adding the following:
On May 18, 2017 the Reporting Persons sent a letter to the Issuer. A copy of such letter is attached hereto as Exhibit 99.3 and is incorporated herein by reference.
Item 5. | Interest in Securities of the Issuer. |
Item 5(a) is hereby amended and restated to read in its entirety as follows:
(a) | As of the date hereof, LF-RB Management, LLC may be deemed to have voting control over, and beneficial ownership of, an aggregate of 952,479 shares of Common Stock of the Issuer, representing approximately 9.0% of the outstanding shares of Common Stock of the Issuer, based on a total of 10,496,339 shares of Common Stock reported by the Issuer to be issued and outstanding as of April 29, 2016, as reported by the Issuer in its Proxy Statement on Schedule 14A, as filed with the Securities and Exchange Commission on April 29, 2016, plus 139,047 shares of Common Stock underlying warrants held by Mr. Baksa exercisable within 60 days of the date hereof. |
LF-RB is the record owner of 0 shares of Common Stock. Mr. Herman is the record owner of 3,390 shares of Common Stock. Mr. Goose is the record owner of 0 shares of Common Stock. Mr. Baksa is the record owner of 357,863 shares of Common Stock and warrants to purchase an additional 139,047 shares of Common Stock that may be exercised within 60 days of the date hereof. Mr. Jacinto is the record owner of 144,551 shares of Common Stock. Mr. Bellofatto is the record owner of 150,000 shares of Common Stock. Mr. Hofpspirger is the record owner of 115,148 shares of Common Stock. Mr. Giles is the record owner of 42,408 shares of Common Stock. As described above, on April 25, 2016, Reporting Persons entered into the Voting Agreement.
Item 7. | Material to be Filed as Exhibits |
Item 7 is hereby amended and supplemented by adding the following exhibits:
99.2 | Voting Agreement, dated April 25, 2016, by and among LF-RB Management, LLC, Gary L. Herman, Michael Goose, Richard Jacinto, Richard Bellofatto and Larry Hofpspirger. |
99.3 | Letter sent to the Issuer by the Reporting Persons, dated May 18, 2016. |
Page 10 of 11 pages |
SIGNATURE
After reasonable inquiry and to the best of its knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.
EXECUTED this 18th day of May, 2016. | ||
LF-RB MANAGEMENT, LLC | ||
By: | /s/ Gary L. Herman | |
Gary L. Herman | ||
Managing Member | ||
By: | /s/ Michael Goose | |
Michael Goose | ||
Managing Member | ||
/s/ Gary L. Herman | ||
Gary L. Herman | ||
/s/ Michael Goose | ||
Michael Goose | ||
/s/ Stephen D. Baksa | ||
Stephen D. Baksa | ||
/s/ Richard Jacinto | ||
Richard Jacinto | ||
/s/ Richard Bellofatto | ||
Richard Bellofatto | ||
/s/ Larry Hofpspirger | ||
Larry Hofpspirger | ||
/s/ Edward M. Giles | ||
Edward M. Giles |
Page 11 of 11 pages |
Exhibit 99.2
VOTING AGREEMENT
THIS VOTING AGREEMENT (“Agreement”) is made and entered into as of the 25th day of April, 2016, by and among the UNDERSIGNED SHAREHOLDERS (each, a “Shareholder” and collectively the “Shareholders”) of RICE BRAN TECHNOLOGIES, INC., a California corporation (the “Company”) and LF-RB MANAGEMENT, LLC (the “Proxy”).
RECITALS
The Shareholders and the Proxy are the owners of record of such number of shares of common stock (the “Common Stock”), of the Company set forth adjacent to their respective signatures below.
Each Shareholder desires to establish certain rights and obligations regarding its ownership of the Company's securities and is willing to enter into this Agreement to govern (i) all shares of the Company’s common stock (“Common Stock”) that such Shareholder now beneficially owns (as defined in Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) or controls and (ii) any and all shares of voting capital stock of the Company that such Shareholder or its successors may hereafter beneficially own (as defined in Rule 13d-3 promulgated under the Exchange Act), control or have the right to vote (all shares of Common Stock presently owned and all shares of voting capital stock owned or acquired hereafter by each Shareholder are hereinafter sometimes referred to in the aggregate as the “Shares”).
Each Shareholder deems it to be in its best interests to irrevocably appoint the Proxy as its proxy, with full right and power to vote all Shares that it now or may hereafter beneficially own.
AGREEMENT
ACCORDINGLY, in consideration of the recitals set forth above and the mutual covenants and agreements contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each of the parties hereto, intending legally to be bound, hereby agrees as follows:
1. Representations of Shareholder. Each Shareholder hereby represents and warrants to the Proxy that such Shareholder: (a) owns and has the right to vote the number of Shares set forth adjacent to its signature below, (b) has full power to enter into this Agreement and has not, prior to the date of this Agreement, executed or delivered any proxy or entered into any other voting agreement or similar arrangement and (c) will not take any action inconsistent with the purposes and provisions of this Agreement.
2. Changes in Common Stock. In the event that after the date of this Agreement any shares of Common Stock or other securities of the Company or another corporation or other legal entity are issued with respect to, or in exchange for, any of the Shares by reason of any stock dividend, stock split, consolidation of shares, reclassification, exchange, merger or consolidation or otherwise involving the Company, such shares of Common Stock or other securities shall be deemed to be Shares for purposes of this Agreement.
3. Voting of Shares. Each Shareholder agrees and covenants that at any meeting of shareholders of the Company or any other action by the shareholders of the Company, whether at a meeting, written consent or otherwise, all of its Shares shall be voted by the Proxy in the manner and to the effect determined by said Proxy in its sole and absolute discretion. Accordingly, during the term of this Agreement, no Shareholder shall vote or attempt to vote any Shares or otherwise exercise or attempt to exercise any voting or other approval rights of any Shares, and any such prohibited exercise by any Shareholder of voting or approval rights shall be void and of no force or effect.
4. Proxy.
(a) Each Shareholder hereby irrevocably constitutes and appoints Proxy as proxy for such Shareholder, with full power of substitution, for and in the name and on behalf of such Shareholder, to vote any and all of its Shares with regard to any question, action, resolution, election or other matter presented to the shareholders of the Company (or its successor, if any) for vote or approval, whether at a meeting or pursuant to written consent or otherwise. Proxy shall vote said Shares in such manner and to such effect as it may determine in its sole and absolute discretion. The proxy granted hereby shall remain in effect for so long as and at all times that this Agreement shall remain in effect, and shall terminate immediately and automatically as provided in Section 6. The proxy granted hereby is irrevocable and is coupled with an interest.
(b) Proxy hereby accepts its appointment as proxy of the Shareholders, pursuant to paragraph (a) of this Section 4.
5. Limitation of Proxy's Liability; Indemnification.
(a) Proxy shall not incur any liability or responsibility by reason of any error of judgment, mistake of law or other mistake, or for any act or omission of any agent or attorney, or for any misconstruction of this Agreement, or for any action of any kind taken or omitted hereunder or believed by him to be in accordance with the provisions and intents hereof, except for its own individual intentional misconduct in bad faith.
(b) The Shareholders hereby agree to fully indemnify Proxy to the maximum extent legally permitted against all costs, charges, expenses and other liabilities properly incurred by it in the exercise of any voting or other power conferred upon it hereunder, including attorneys’ fees and expenses, and the Shareholders covenant with Proxy that each of the Shareholders, in proportion to the amount of their respective proportionate ownership of the Company's Shares, will hold harmless and keep indemnified Proxy of and from all losses or damages it may sustain or be put to by reason of anything it does in the exercise of the proxy granted hereby. The Shares subject to this Agreement shall serve as security for the foregoing agreement to indemnify Proxy and hold it harmless. No person or entity shall be deemed a third party beneficiary of this Agreement.
6. Termination. This Agreement shall terminate only upon the earlier to occur of (a) September 30, 2016, or (b) the occurrence of any one of the following events:
(i) liquidation or dissolution of the Company or its successor, if any;
(ii) the Proxy's death or incapacity to act hereunder;
(iii) the termination of this Agreement by written consent of all parties to this Agreement;
(iv) by operation of law, if and to the extent applicable; or
(v) as to any Shareholder, upon thirty (30) days prior written notice by such Shareholder to Proxy of its desire to terminate this Agreement.
7. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to any conflict of law rule or principle that would give effect to the laws of another jurisdiction.
8. Benefits; Binding Effect. This Agreement shall be for the benefit of and binding upon the parties hereto and their respective heirs, personal representatives, legal representatives, successors, assigns and transferees, as applicable.
9. Counterparts. This Agreement may be executed in several counterparts and all so executed shall constitute one Agreement, binding on all the parties hereto, notwithstanding that all the parties are not signatories to the original or same counterpart.
10. Amendment or Modification. This Agreement may be altered, modified or amended only by the unanimous written consent of the parties hereto.
11. Entire Agreement. This Agreement constitutes the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes all prior agreements, understandings and arrangements, both oral and written, among the parties hereto with respect to such subject matter.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first above written.
PROXYHOLDER | PROXY | SHARES | ||
(signature) | ||||
LF-RB Management, LLC | /s/ Gary Herman | 409,699 | ||
Gary Herman, Managing Member | ||||
SHAREHOLDER | SHAREHOLDER | SHARES | ||
(signature) | (now owned) | |||
Larry Hofpspirger | /s/ Larry Hopfspirger | 115,148 | ||
Richard Jacinto | /s/ Richard Jacinto | 144,551 | ||
Richard Bellofatto | /s/ Richard Bellofatto | 150,000 |
PROXY
Each of the undersigned hereby irrevocably constitutes and appoints LF-RB MANAGEMENT, LLC (the “Proxy”) as proxy for the undersigned, with full power of substitution, for and in the name and on behalf of the undersigned, to vote, or to execute and deliver written consents or otherwise act with respect to, in its sole and absolute discretion, any and all shares of Common Stock of RICE BRAN TECHNOLOGIES, INC., a Michigan corporation (the “Company”), now owned or hereafter acquired by the undersigned (and any shares or other securities of another corporation or other legal entity that may hereafter be issued with respect to, or in exchange for, any such shares or other securities), as fully, to the same extent and with the same effect as the undersigned, its attorney and proxy or its substitute might or could lawfully do with respect to any question, action, resolution, election or other matter presented to the shareholders of the Company (or its successor, if any) for approval, whether at any annual or special meeting of the Company's shareholders, by written consent or otherwise.
This Proxy is given pursuant to a Voting Agreement dated April 25, 2016, among the undersigned and the Proxy. This Proxy shall remain in full force and effect from the date hereof until such Voting Agreement has been terminated in accordance with the terms thereof.
IN WITNESS WHEREOF, the undersigned has executed this Proxy as of the 25th day of April, 2016.
Shareholder | Shareholder | Shares | ||
(signature) | (now owned) | |||
Larry Hopfspirger | /s/ Larry Hopfspirger | 115,148 | ||
Richard Jacinto | /s/ Richard Jacinto | 144,551 | ||
Richard Bellofatto | /s/ Richard Bellofatto | 150,000 | ||
ACCEPTED: | ||||
Proxyholder | Proxy | Shares | ||
(signature) | ||||
LF-RB Management, LLC | /s/ Gary Herman | 409,699 | ||
Gary Herman, Managing Member |
Exhibit 99.3
LF-RB MANAGEMENT, LLC
720 Fifth Avenue, 10th Floor
New York, NY 10019
May 18, 2016
Robert C. Schweitzer, Chairman
RiceBran Technologies, Inc.
6720 North Scottsdale Road, Suite 390
Scottsdale, AZ 85253
Dear Mr. Schweitzer:
As you know, we own or represent approximately 9.0% of the issued and outstanding shares of common stock of RiceBran Technologies, Inc. (the “Company” or “RiceBran”), making us one of the Company’s largest shareholders. After listening to the earnings call on May 16, 2016, we continue to be very concerned with the Company’s direction and the inability of management and the Board to effectively manage the Company. In particular:
· | RiceBran’s current board has repeatedly failed to deliver results for shareholders. |
· | Operating results have been lackluster and materially worse than management’s guidance and external expectations. |
· | Significant board and management change is desperately needed to properly oversee the business and implement a turnaround and growth plan. |
Therefore, we are proposing immediate changes to management and the Board.
Inability to Grow Business in a High Growth Category
As we have previously stated, we view the Company’s primary business opportunities to be in the functional food, beverage and nutraceutical sectors. Despite creating a unique and valuable protein/fiber food ingredient product set, the Company’s products have not effectively penetrated the market or gained significant product adoption, and they have not achieved expectations in a growing market. On the recent earnings call, we found it unnecessary and, quite frankly, a waste of time for management to discuss the growth potential in the healthy food marketplace. Most of the shareholders realize the potential and are more interested in how management will grow the business in a predictable and consistent manner and meet shareholder growth expectations.
Rather than presenting a lesson in Healthy Food 101 on the earnings call, management should stand behind its “rosey” business forecasts and reinstitute guidance, which it abruptly stopped after the Company continually failed to meet financial projections. We find it very concerning that, on the one hand, management wants shareholders to believe they can effectively manage the Company but, on the other hand, they are unwilling to stand by their words and provide guidance.
Continued Losses
In the most recent quarter, while revenues increased slightly, they are still far below guidance from the past. In the U.S., we are concerned by the decline in Gross Profit margins to 31.7% from 34.9% in Q4-15. The Brazilian business segment performance continues to be disastrous and we are extremely concerned that it will continue to be a cash drain on the Company. Based on the invested capital and the revenue it generates, this small business segment has too large of a detrimental effect on the overall financial health of the Company.
New Leadership and Focus
We believe the current management and Board of Directors (the “Board”) is not proactive and needs to be changed significantly. There is a need for change and fresh blood to unlock the value potential of the Company’s products. As a starting point, we have identified candidates to replace the current CEO, CFO, and at least a majority of the Board.
CEO Candidate:
Our CEO candidate has over 13 years of consumer package goods (“CPG”) experience as a new product innovator and leader in natural foods, marketing and sales, management and brand development. He spent 12 years in various management roles at Hain-Celestial Group, Inc. (NASDAQ: HAIN), the leading healthy food company in the world. Prior to his departure from Hain-Celestial, he was Director of Marketing for Strategic Brands, where he was responsible for over $40 million of sales a year and over 100 different products. He was also involved in numerous aspects of Hain-Celestial’s business from the initial acquisition of Yves in Canada, to the acquisition of GG Unique Fiber. He earned his BA with a focus in economics from Dalhousie University.
CFO Candidate:
Our CFO candidate has 39 years of Accounting and Finance experience, all of which is in the food processing, manufacturing and food distribution industry. He has held various positions as a CFO, Finance Director, Controller and Cost Accountant. For the past 6 years, he has served as the Finance Director for the California division of one of the largest Food Processors in the United States. His current responsibilities include internal control and inventory accounting for two of the three largest manufacturing facilities in the United States, and all back office functions. His accomplishments include consolidating five individual operating divisions into one centralized back office, reducing headcount and improving cash flow. Prior to his current position, he was the General Manager for a $150 million sales division of the same company, where he had P&L responsibility. He has a BS and MBA in Finance from Michigan State University. He is also a Certified Management Accountant (CMA).
Board Candidates:
We have identified a number of highly qualified board candidates who have strong experience serving on the board of directors of publicly-listed companies, food and agricultural industry experience, proven track records in creating shareholder value and the ability to attract capital. We will present information on these specific candidates when we are able to meet in person.
Immediate Assessment of the Business Segments
In light of the continued poor performance of the Company’s business, we believe it behooves management to immediately review and examine a number of aspects of the Company’s business, and conduct the following assessments and reviews:
· | A thorough assessment of the Brazilian business in light of the capital expenditures and distractions to management. |
· | A thorough assessment of all contracts and joint ventures and their financial impact on the Company. |
· | Evaluation and reduction in Sales, General and Administrative expenses to fit more in line with the revenue of the company and projected quarterly guidance. |
· | Comprehensive review of SKU counts by margin and consolidation to ensure cash and focus are on the strongest opportunities. |
· | Assessment of the low margin animal feed business. |
· | Review and change the current sales strategy to create greater awareness and increase product demand. |
Action Steps
We propose the following action steps immediately to save the Company and give shareholders a chance of recouping their losses and creating value:
· | The resignation of at least a majority of the Board, to be replaced with our candidates. |
· | Changes in top management with our candidates, subject to additional changes. |
· | Redeployment of the Company’s financial resources in the United States to maximize the potential of this strong domestic market. |
· | Implement a growth plan to effectively utilize the Company’s resources to penetrate the food, beverage and nutraceuticals markets and drive product adoption and sales. |
We are prepared to provide additional capital resources, as required, to implement the plan.
In addition, we insist that the Board immediately send out notice to delay its upcoming Annual Shareholders Meeting scheduled for June 22, 2016, for a period of up to 45 days. If you are unwilling to delay the Annual Shareholders Meeting and replace at least a majority of the Board with our candidates, we are prepared to call a Special Meeting of the Shareholders as soon as possible to: 1) remove the entire Board of Directors; and 2) elect a new Board of Directors. We expect and believe that many shareholders want immediate changes and are extremely disappointed with the performance of the current management and the Board.
We look forward to meeting with you and members of the Board to discuss our operational and strategic plans to create shareholder value. We can be reached at (212) 247-0581.
Very truly yours,
LF-RB MANAGEMENT, LLC
By: | /s/ Gary Herman | |
Gary Herman, Managing Member | ||
By: | /s/ Michael Goose | |
Michael Goose, Managing Member | ||
and | ||
By: | /s/ Stephen D. Baksa | |
Stephen D. Baksa |
cc: | Marco V. Galante, Director |
David Goldman, Director | |
Baruch Halpern, Director | |
Henk W. Hoogenkamp, Director | |
Peter A. Woog, Director | |
John Short, CEO | |
Andrew Hulsh, Esq. | |
Pepper Hamilton, LLP |