The Plan
RICELANDFOODS,INC,RESTATEDBASECAPITALPLAN
The Restated Base Capital Plan (“Plan”) is a funding method through which Riceland raises equity capital necessary to finance and operate its business, including constructing storage facilities, purchasing equipment, and providing other assets necessary to receive, store, process, and market crops delivered by cooperative patrons. The Bylaws authorize the Board of Directors to determine the required Base Capital contribution. The Board has approved this Plan which shall be in effect for the 2025-26 fiscal year of Riceland Foods, Inc, with an effective start date of 8/1/2025.
Applicability
The per bushel investment obligation required by the Plan for rice is applicable to each bushel of rice delivered by Patrons regardless of whether the patron is a member or non-member; this includes the rice seasonal pool and all rice self-pricing marketing options open to producer patrons.
The per bushel investment obligation required by the Plan for soybeans is applicable to each bushel of soybeans delivered into Riceland’s soybean seasonal pool.
Rice Per Bushel Investment Obligation
The Base Capital investment obligation is $0.13 per bushel for each bushel of rice delivered to Riceland and marketed through any of the cooperative’s patronage rice marketing programs in fiscal year 2025-26. (See Applicability above). Riceland will deduct the per bushel investment obligation from the amount it would otherwise owe you for each such bushel. Once the required per bushel investment is made, all other advances or payments for such rice will be in cash.
Redemptions of Rice Base Capital
Thirteen cents of the $0.13 per bushel retained for rice in 2025-26 will be redeemed by Riceland in 12 years. The redemption period stated is subject to amendment by the Board of Directors in its sole discretion; however, it represents the Board’s current intention.
Soybean Per Bushel Investment Obligation
The Base Capital investment obligation is $0.10 per bushel for each bushel of soybeans delivered to Riceland and marketed through the Riceland soybean seasonal pool in fiscal
year 2025-26 (See Applicability above). Riceland will deduct the per bushel investment obligation from the amount it would otherwise owe you for each such bushel. Once the requiredperbushelinvestmentismade,allotheradvancesorpaymentsforsuchsoybeans will be in cash.
Redemptions of Soybean Base Capital
Ten cents of the $0.10 per bushel retained for soybeans in 2025-26 will be redeemed by Riceland in 12 years. The redemption period stated is subject to amendment by the Board of Directors in its sole discretion; however, it represents the Board’s current intention.
Records and Reporting
The Base Capital Plan maintains separate records for equity investments made related to rice,soybeans,andother crops.Nophysicalcertificateswillbeissuedfor yourperbushel investments in the Base Capital Plan. Instead, the amount of equity invested by you pursuant to the Base Capital Plan will be noted as a book entry on Riceland’s financial records as an obligation and referred to as Base Capital or Base Capital Credits. Beginning in2025-26,those BaseCapitalCreditswill beidentifiedbyyearof investment to allow for timely redemption.
Riceland will annually provide an equity report to each patron summarizing your equity investment in the cooperative, including any Base Capital Credits for rice, soybeans, or other crops issued pursuant to the Base Capital Plan. For Base Capital Credits issued in the 2025/26 fiscal year and beyond, the report will list the anticipated redemption date for those Base Capital Credits.
Sales or Transfers
No assignment or transfer of any interest in the capital credited to a patron shall be binding upon Riceland unless it shall have been entered on the books and records of Ricelandinaccordancewith thetermsandconditions specifiedby theBoardofDirectors.
To ensure accurate ownership and accounting, Base Capital sales or transfers are permitted to the Patron's spouse, partner, or children; to a corporation, partnership, trust, limited liability company, or other legal entity in which the Patron has a substantial ownership interest; or, if the Patron is a legal entity, to a person holding a substantial ownership interest in said entity. Transfers also are allowed to the Patron’s heirs or devisees upon the death of a Patron. No other sales or transfers are permitted.
Tax Treatment
It is Riceland’s intent that the per bushel equity investment required under the Base Capital Plan and corresponding Base Capital Credits will constitute qualified per unit retain certificates under the applicable federal and state statutory law and regulations, including the applicable Internal Revenue Code and implementing regulations.
Early Redemptions
In addition to the redemptions referenced herein, the Riceland Board has authorized certain other programs that may allow early redemption of Base Capital for patrons under specialized circumstances.
a. Retiree Redemption
Patrons who are no longer engaged in active farming may have their Base Capital Redeemed during a period established by the Board of Directors. The current goal is to redeem retiree Base Capital within five years, subject to availability of funds. Eligible Retirees must submit an enrollment application to the Member Services Department to participate. Verified Applications received by July 31 will be eligible to receive approved redemption payments issued during the following September/October.
b. Special Equity Redemption Program. The Board has also approved a Special Equity Redemption Program for the redemption of Base Capital for decedent’s estates, foreclosures, bankruptcies, and retirements. This program allows early redemption of Base Capital at a discounted rate set by the Board assuming certain qualifications are met and subject to availability of funds as determined by the Board in its discretion. Please contact the Member Services Department for further details about this Program.
c. Hardship Program. The Board has approved a Program to refund a portion of the Base Capital of patrons who have experienced a “Hardship” as determined by the Board in its discretion and subject to availability of funding, which is limited. Please contact the Member Services Depart for further details about this Program.