ribt20210723

ribt20210723_10q.htm

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2021

☐	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission File Number 001-36245

RiceBran Technologies

(Exact Name of Registrant as Specified in its Charter)

California

(State or other jurisdiction of

incorporation or organization)

87-0673375

(I.R.S. Employer Identification No.)

25420 Kuykendahl Rd., Suite B300

Tomball, TX

(Address of Principal Executive Offices)

77375

(Zip Code)

(281) 675-2421

(Registrant’s telephone number, including area code)

None

(Former name, former address and former fiscal year, if changed since last report

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading symbol		Name of each exchange on which registered
Common Stock, no par value per share		RIBT		The NASDAQ Capital Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company, or an emerging company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☐	Non-accelerated filer ☒	Smaller reporting company ☒
			Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule l2b-2 of the Exchange Act). Yes ☐ No ☒

As of July 30, 2021, there were 45,487,609 shares of common stock outstanding.

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RiceBran Technologies

Index

Form 10-Q

PART I. FINANCIAL INFORMATION		Page
Item 1.	Financial Statements (Unaudited)	1
	Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2021 and 2020	2
	Condensed Consolidated Statements of Comprehensive Loss for the Three and Six Months Ended June 30, 2021 and 2020	3
	Condensed Consolidated Balance Sheets as of June 30, 2021, and December 31, 2020	4
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2021 and 2020	5
	Notes to Unaudited Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	15
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	16
Item 4.	Controls and Procedures	17
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	17
Item 1A.	Risk Factors	17
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	17
Item 3.	Defaults Upon Senior Securities	17
Item 4.	Mine Safety Disclosures	17
Item 5.	Other Information	18
Item 6.	Exhibits	18
Signatures		19

Cautionary Note about Forward-Looking Statements

This quarterly report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, but not limited to, any projections of earnings, revenue, liquidity or other financial items; any statements of the plans, strategies and objectives of management for future operations; any statements concerning proposed new services, products or developments; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing. Forward-looking statements may include the words “may,” “could,” “will,” “estimate,” “intend,” “continue,” “believe,” “expect” or “anticipate” or other similar words. The forward-looking statements contained herein reflect our current views with respect to future events and are subject to certain risks, uncertainties and assumptions. Actual results may differ materially from those projected in such forward-looking statements due to a number of factors, risks and uncertainties, including the factors that may affect future results set forth in this Current Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2020. We disclaim any obligation to update any forward looking statements as a result of developments occurring after the date of this quarterly report.

Unless the context requires otherwise, references to “we,” “us,” “our” and “the Company” refer to RiceBran Technologies and its consolidated subsidiaries.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

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RiceBran Technologies

Condensed Consolidated Statements of Operations

(Unaudited) (in thousands, except share and per share amounts)

	Three Months Ended June 30,						Six Months Ended June 30,
	2021			2020			2021			2020

Revenues	$	7,574		$	5,903		$	16,179		$	14,233
Cost of goods sold		7,421			7,127			15,354			15,862
Gross profit (loss)		153			(1,224	)		825			(1,629	)
Selling, general and administrative expenses		1,933			2,307			3,674			4,857
(Gain) Loss on disposition and involuntary conversion of property and equipment		(1	)		308			6			308
Operating loss		(1,779	)		(3,839	)		(2,855	)		(6,794	)
Interest income		-			8			1			19
Interest expense		(120	)		(76	)		(232	)		(125	)
Gain on extinguishment of PPP loan		-			-			1,792			-
Other expense		(24	)		(42	)		(37	)		(87	)
Other income		-			-			-			5
Loss before income taxes		(1,923	)		(3,949	)		(1,331	)		(6,982	)
Income tax expense		-			-			(1	)		-
Net loss	$	(1,923	)	$	(3,949	)	$	(1,332	)	$	(6,982	)

Loss per common share:
Basic	$	(0.04	)	$	(0.10	)	$	(0.03	)	$	(0.17	)
Diluted	$	(0.04	)	$	(0.10	)	$	(0.03	)	$	(0.17	)

Weighted average number of shares outstanding:
Basic		45,864,385			40,052,163			45,749,785			40,007,660
Diluted		45,864,385			40,052,163			45,749,785			40,007,660

See Notes to Unaudited Condensed Consolidated Financial Statements

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RiceBran Technologies

Condensed Consolidated Statements of Comprehensive Loss

(Unaudited) (in thousands)

	Three Months Ended June 30,						Six Months Ended June 30,
	2021			2020			2021			2020

Net loss	$	(1,923	)	$	(3,949	)	$	(1,332	)	$	(6,982	)

Derivative financial instruments designated as cash flow hedges:
Losses arising during the period		-			(100	)		-			(100	)
Reclassification of losses realized to cost of goods sold		-			52			-			52
Net other comprehensive loss		-			(48	)		-			(48	)

Comprehensive loss	$	(1,923	)	$	(3,997	)	$	(1,332	)	$	(7,030	)

See Notes to Unaudited Condensed Consolidated Financial Statements

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RiceBran Technologies

Condensed Consolidated Balance Sheets

(Unaudited) (in thousands, except share amounts)

	June 30,			December 31,
	2021			2020
ASSETS
Current assets:
Cash and cash equivalents	$	4,010		$	5,263
Accounts receivable, net of allowance for doubtful accounts of $9 and $9		2,556			2,819
Inventories		1,836			1,878
Other current assets		1,844			1,380
Total current assets		10,246			11,340
Property and equipment, net		15,588			16,367
Operating lease right-of-use assets		2,291			2,452
Goodwill		3,915			3,915
Intangible assets		620			722
Total assets	$	32,660		$	34,796

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	796		$	955
Commodities payable		869			825
Accrued salary, wages and benefits		963			601
Accrued expenses		347			536
Operating lease liabilities, current portion		362			344
Due under insurance premium finance agreements		756			126
Due under factoring agreement		1,805			1,785
Finance lease liabilities, current portion		87			82
Long-term debt, current portion		1,598			572
Total current liabilities		7,583			5,826
Operating lease liabilities, less current portion		2,112			2,330
Finance lease liabilities, less current portion		109			113
Long-term debt, less current portion		49			3,107
Total liabilities		9,853			11,376
Commitments and contingencies
Shareholders' equity:
Preferred stock, 20,000,000 shares authorized: Series G, convertible, 3,000 shares authorized, stated value $225, 225 shares, issued and outstanding		112			112
Common stock, no par value, 150,000,000 shares authorized, 45,487,609 shares and 45,238,087 shares, issued and outstanding		322,937			322,218
Accumulated deficit		(300,242	)		(298,910	)
Total shareholders' equity		22,807			23,420
Total liabilities and shareholders' equity	$	32,660		$	34,796

See Notes to Unaudited Condensed Consolidated Financial Statements

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RiceBran Technologies

Condensed Consolidated Statements of Cash Flows

(Unaudited) (in thousands)

	Six Months Ended June 30,
	2021			2020
Cash flow from operating activities:
Net loss	$	(1,332	)	$	(6,982	)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation		1,219			1,157
Amortization		102			117
Stock and share-based compensation		548			664
Loss on diposition and involuntary conversion of property and equipment		6			308
Gain on extinguishment of PPP loan		(1,792	)		-
Other		15			(107	)
Changes in operating assets and liabilities:
Accounts receivable		262			1,090
Inventories		42			(1,111	)
Accounts payable and accrued expenses		197			(201	)
Commodities payable		44			(631	)
Other		(727	)		(675	)
Net cash used in operating activities		(1,416	)		(6,371	)
Cash flows from investing activities:
Purchases of property and equipment		(540	)		(843	)
Proceeds from insurance on involuntary conversion		263			-
Net cash used in investing activities		(277	)		(843	)
Cash flows from financing activities:
Advances on factoring agreement		15,660			15,131
Payments on factoring agreement		(15,685	)		(14,946	)
Advances on insurance premium finance agreements		962			506
Payments on insurance premium finance agreements		(332	)		(316	)
Advances on long-term debt and finance lease liabilities		-			1,792
Payments on long-term debt and finance lease liabilities		(336	)		(62	)
Proceeds from common stock warrant exercises		171			12
Net cash provided by financing activities		440			2,117
Net change in cash and cash equivalents	$	(1,253	)	$	(5,097	)

Cash and cash equivalents, beginning of period		5,263			8,444
Cash and cash equivalents, end of period		4,010			3,347
Net change in cash and cash equivalents	$	(1,253	)	$	(5,097	)

Supplemental disclosures:
Cash paid for interest	$	179		$	79
Cash paid for income taxes	$	16		$	-

See Notes to Unaudited Condensed Consolidated Financial Statements

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RiceBran Technologies

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 1. BASIS OF PRESENTATION

In the opinion of management, the accompanying unaudited condensed consolidated financial statements (interim financial statements) of RiceBran Technologies and its subsidiaries were prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and the rules and regulations of the Securities and Exchange Commission ("SEC") for reporting on Form 10-Q; therefore, they do not include all of the information and notes required by GAAP for complete financial statements. The interim financial statements contain all adjustments necessary to present fairly the interim results of operations, financial position and cash flows for the periods presented of a normal and recurring nature necessary to present fairly the interim results of operations, financial position and cash flows for the periods presented.

These interim financial statements should be read in conjunction with the consolidated audited financial statements and notes thereto in our Annual Report on Form 10-K for the year ended December 31, 2020, which included all disclosures required by generally accepted accounting principles.

The results reported in these interim financial statements are not necessarily indicative of the results to be expected for the full fiscal year, or any other future period, and have been prepared based on the realization of assets and the satisfaction of liabilities in the normal course of business.

NOTE 2. BUSINESS

We are a specialty ingredient company focused on the development, production, and marketing of products derived from traditional and ancient small grains. We create and produce products utilizing proprietary processes to deliver improved nutrition, ease of use, and extended shelf-life, while addressing consumer demand for all natural, non-GMO and organic products. We believe our products are valuable alternatives to traditional food ingredients.

Notably, we apply our proprietary technologies to convert raw rice bran into stabilized rice bran ("SRB"), and high value-added derivative products including: RiBalance, a rice bran nutritional package derived from SRB; RiSolubles, a nutritious, carbohydrate and lipid rich fraction of RiBalance; RiFiber, a fiber rich insoluble derivative of RiBalance and ProRyza, a rice bran protein-based product; as well as a variety of other valuable derivatives extracted from these core products.

In granular form, SRB is an ingredient used in products for human and animal consumption. We believe SRB has certain qualities that make it more attractive than ingredients based on the by-products of other agricultural commodities, including corn, soybeans, wheat, and yeast. Our SRB products and SRB derivatives support the production of healthy, natural, hypoallergenic, gluten free, and non-genetically modified ingredients and supplements for use in meats, baked goods, cereals, coatings, health foods, and high-end animal nutrition. Our target customers are food and animal nutrition manufacturers, wholesalers and retailers, both domestically and internationally.

We manufacture and distribute SRB from four locations: two facilities located within supplier-owned rice mills in Arbuckle and West Sacramento, California; one company-owned facility in Mermentau, Louisiana; and our own rice mill in Wynne, Arkansas. At our Dillon, Montana facility, we produce SRB-based products and derivatives through proprietary processes. Our rice mill in Wynne, Arkansas also supplies grades U.S. No. 1 and No. 2 premium long and medium white rice, and our grain processing facility in East Grand Forks, Minnesota, mills a variety of traditional, and ancient, small grains. Given the integrated nature of these facilities, we have one reporting unit and one operating segment, specialty ingredients.

NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following discusses the accounting standard(s) not yet adopted that will, or are expected to, result in a significant change in practice and/or have a significant financial impact on our financial position, results of operations or cash flows.

In June 2016, the Financial Accounting Standards Board ("FASB") issued guidance ASU No. 2016-13 Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments which changes the accounting for credit losses for certain instruments, including trade receivables, from an incurred loss method to a current expected loss method. The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts. The guidance, and subsequent guidance related to the topic, is effective for our annual and interim periods beginning in 2023 and must be adopted on a modified retrospective approach through cumulative-effect adjustment to retained earnings as of January 1, 2023. Based on the nature of our current receivables and our credit loss history, we do not expect the adoption of the guidance to have a significant impact on our results of operations, financial position, or cash flows.

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RiceBran Technologies

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 4. CASH AND CASH EQUIVALENTS

As of June 30, 2021, we have $2.4 million of cash and cash equivalents invested in a money market fund with net assets invested in U.S. Dollar denominated money market securities of domestic and foreign issuers, U.S. Government securities and repurchase agreements. We consider all liquid investments with original maturities of three months or less at the time of purchase to be cash equivalents.

We have cash on deposit in excess of federally insured limits at a bank. We do not believe that maintaining substantially all such assets with the bank or investing in a liquid mutual fund represent material risks.

NOTE 5. ACCOUNTS RECEIVABLE AND REVENUES

Amounts billed and due from our customers are classified as accounts receivables on our consolidated balance sheets and require payment on a short-term basis. Invoices are generally issued at the point control transfers and substantially all of our invoices are due within 30 days or less, however certain customers have terms of up to 120 days. For substantially all of our contracts, control of the ordered product(s) transfers at our location. Periodically, we require payment prior to the point in time we recognize revenue. Amounts received from customers prior to revenue recognition on a contract are contract liabilities, are classified as customer prepayments liability on our consolidated balance sheets and are typically applied to an invoice within 30 days of the prepayment.

Our accounts receivable potentially subject us to significant concentrations of credit risk. Revenues and accounts receivable from significant customers (customers with revenue or accounts receivable in excess of 10% of consolidated totals) are stated below as a percent of consolidated totals.

	Customer
	A			B			C			D
% of revenues, three months ended June 30, 2021		15	%		15	%		3	%		2	%
% of revenues, three months ended June 30, 2020		8	%		4	%		10	%		3	%

% of revenues, six months ended June 30, 2021		12	%		11	%		5	%		2	%
% of revenues, six months ended June 30, 2020		13	%		5	%		9	%		2	%

% of accounts receivable, as of June 30, 2021		13	%		11	%		7	%		8	%
% of accounts receivable, as of December 31, 2020		1	%		7	%		17	%		10	%

The following table presents revenues by geographic area shipped to (in thousands).

	Three Months Ended June 30				Six Months Ended June 30
	2021		2020		2021		2020
United States	$	7,221	$	5,532	$	15,417	$	13,500
Other countries		353		371		762		733
Revenues	$	7,574	$	5,903	$	16,179	$	14,233

NOTE 6. INVENTORIES

The following table details the components of inventories (in thousands).

	June 30,		December 31,
	2021		2020
Finished goods	$	1,364	$	1,512
Raw materials		351		236
Packaging		121		130
Inventories	$	1,836	$	1,878

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RiceBran Technologies

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 7. PROPERTY AND EQUIPMENT

The following table details the components of property and equipment (amounts in thousands).

	June 30,		December 31
	2021		2020		Estimated Useful Lives
Land	$	730	$	730
Furniture and fixtures		276		276	5	-	10 years
Plant		9,438		9,377	20	-	40 years, or life of lease
Computer and software		1,095		1,060	3	-	5 years
Leasehold improvements		1,880		1,880	4	-	15 years, or life of lease
Machinery and equipment		16,741		16,402	5	-	15 years
Property and equipment, cost		30,160		29,725
Less accumulated depreciation		14,572		13,358
Property and equipment, net	$	15,588	$	16,367

Amounts payable for property and equipment included in accounts payable of $0.1 million at June 30, 2021, and $0.3 million at December 31, 2020. Assets which had not yet been placed in service, included in property and equipment, totaled $0.9 million at June 30, 2021, and $0.6 million at December 31, 2020.

Involuntary Conversion

In 2020, we wrote down assets, consisting primarily of a building, machinery and equipment, in the amount of $0.9 million and incurred other costs of $0.1 million as a result of hurricane damage that occurred in August 2020 to our Lake Charles, Louisiana property. Operations at this facility have been shut down since September 2020, while this facility is being repaired. We currently expect insurance recoveries will cover our asset loss to the extent it exceeds our $0.1 million deductible under our insurance policy. In September 2020, we received an advance on the insurance settlement of $0.3 million and we accrued a receivable for the additional $0.7 million of expected insurance proceeds related to our asset loss. The resulting $0.1 million net loss on involuntary conversion of assets was included in selling, general and administrative expenses in our consolidated financial statements in the third quarter of 2020. During the three months ended June 30, 2021, we received $0.3 million of proceeds from the insurer. The insurance proceeds receivable included in other current assets on our consolidated balance sheet was $0.5 million at June 30, 2021, and $0.7 million as of December 31, 2020. The final settlement with the insurer on this matter will likely differ from the total proceeds we have estimated as of June 30, 2021. We accrue estimated insurance proceeds receivable when the proceeds are estimable and probable of collection. Given the nature of recoveries of lost profits under business interruption insurance we have not accrued insurance proceeds receivable for any potential recoveries of lost profits.

NOTE 8. LEASES

The components of lease expense and cash flows from leases (amounts in thousands) follow.

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Finance lease cost:
Amortization of right-of use assets, included in cost of goods sold	$	22	$	20	$	43	$	41
Interest on lease liabilities		3		4		6		8
Operating lease cost, included in selling, general and administrative expenses:
Fixed leases cost		128		131		257		261
Variable lease cost		37		33		75		48
Short-term lease cost		-		-		-		3
Total lease cost	$	190	$	188	$	381	$	361

Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases	$	3	$	4	$	6	$	8
Operating cash flows from operating leases	$	128	$	131	$	257	$	261
Financing cash flows from finance leases	$	24	$	20	$	50	$	46

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RiceBran Technologies

Notes to Unaudited Condensed Consolidated Financial Statements

As of June 30, 2021, variable lease payments do not depend on a rate or index. As of June 30, 2021, property and equipment, net, includes $0.3 million of finance lease right-of-use-assets, with an original cost of $0.4 million. During 2021, we financed the purchase of less than $0.1 million of property and equipment in noncash finance lease transactions.

As of June 30, 2021, we do not believe it is certain that we will exercise any renewal options. The remaining terms of our leases and the discount rates used in the calculation of the fair value of our leases as of June 30, 2021, follows.

	Operating Leases				Finance Leases
Remaining leases terms (in years)	2.3	-	11.7		0.4	-	3.8
Weighted average remaining lease terms (in years)			6.5				2.3
Discount rates	6.3%	-	9.0	%	2.8%	-	7.3	%
Weighted average discount rate			7.7	%			5.2	%

Maturities of lease liabilities as of June 30, 2021, follows (in thousands).

	Operating			Finance
	Leases			Leases
2021 (six months ended December 31, 2021)	$	238		$	50
2022		548			84
2023		528			54
2024		429			14
2025		439			1
Thereafter		1,029			-
Total lease payments		3,211			203
Amounts representing interest		(737	)		(7	)
Present value of lease obligations	$	2,474		$	196

NOTE 9. DEBT

We finance certain amounts owed for annual insurance premiums under financing agreements. As of June 30, 2021, amounts due under insurance premium financing agreements are due in monthly installments of principal and interest through February 2022, at an average interest rate of 3.7 % per year.

In October 2019, we entered into a factoring agreement which provides for a $7.0 million credit facility with a lender. We may only borrow to the extent we have qualifying accounts receivable as defined in the agreement. The facility has an initial two-year term and automatically renews for successive annual periods, unless proper termination notice is given. We paid a $0.2 million facility fee upon inception of the agreement which is amortizing to interest expense on a straight-line basis over two years. We incur recurring fees under the agreement, including a funding fee of 0.5% above the prime rate, in no event to be less than 5.5%, on any advances and a service fee on average net funds borrowed. The lender has the right to demand repayment of the advances at any time. The lender has a security interest in personal property assets.

Due under factoring agreement consists of the following (in thousands).

	June 30,			December 31,
	2021			2020
Borrowings outstanding	$	1,835		$	1,860
Debt issuance costs, net		(30	)		(75	)
Due under factoring agreement	$	1,805		$	1,785

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RiceBran Technologies

Notes to Unaudited Condensed Consolidated Financial Statements

Additional information related to our factoring obligation follows.

	Three Months Ended June 30,						Six Months Ended June 30,
	2021			2020			2021			2020
Average borrowings outstanding (in thousands)	$	1,564		$	2,879		$	1,223		$	2,016
Amortization of debt issuance costs (in thousands)	$	23		$	23		$	45		$	45
Fees paid, as a percentage of average oustanding borrowings		1.5	%		1.5	%		2.9	%		4.3	%
Interest paid, as a percentage of average outstanding borrowings		1.6	%		1.5	%		3.4	%		3.1	%

Long-term debt consists of the following (in thousands).

	June 30,		December 31,
	2021		2020
Mortgage promissory note - Dated September 2020. Interest accrues at an annual rate which is the greater of 11.0% above the lender's prime rate and 14.3%. Payable in monthly installments through June 2022. Net of $18 and $26 debt issuance costs at June 30, 2021 and December 31, 2020.	$	1,550	$	1,817
Payroll Protection Program note - Dated April 2020. Interest accrued at an annual rate of 1.0%. Forgiven in January 2021.		-		1,792
Equipment notes - Initially recorded in November 2018, in an aquisition, at the present value of future payments using a discount rate of 4.8% per year. Payable in monthly installments through expiry dates ranging from May 2022 to August 2022.		30		37
Equipment note - Dated December 2019. Due in monthly installments through December 2024. Interest accrues at the effective discount rate of 9.3% per year.		30		33
Equipment note - Dated May 2021. Original principal $46. Due in monthly installments through June 2025. Interest accrues at the effective discount rate of 3.6% per year.		37		-
Total long term debt, net	$	1,647	$	3,679

In April 2020, we received $1.8 million on a Small Business Administration ("SBA") Payroll Protection Program ("PPP") loan as provided for in the Coronavirus Aid, Relief and Economic Security Act ("CARES"), enacted into U.S. law in March 2020. Under certain conditions, the loan and accrued interest were forgivable, if the loan proceeds were used for maintaining workforce levels. As of December 31 2020, payments on the PPP loan were deferred under the terms of the program. Interest accrued at an annual rate of 1.0%. The loan proceeds were used for maintaining workforce levels and the entire loan and related accrued interest was forgiven, in its entirety in January 2021. As discussed further in Note 14, our compliance with the loan program is subject to potential audit by the SBA.

In July 2020, we entered into a mortgage agreement with a lender pursuant to a promissory note. In September 2020, we borrowed $1.0 million on the note and, in October 2020, we borrowed the remaining $1.0 million available on the note. Interest on this note accrues at an annual rate which is the greater of 11.0% above the lender’s prime rate and 14.3%. In addition, we incurred a facility fee equal to 1.0% of the amount of each advance under the promissory note. The principal amount of the note must be repaid in monthly installments ending in June 2022. The note is secured by certain real property and personal property assets located in Wynne, Arkansas. As of June 30, 2021, the note bore interest at an annual rate of 14.3%.

Future principal maturities of long-term debt outstanding as of June 30, 2021, follow (in thousands).

2021 (six months ended December 31, 2021)	$	317
2022		1,306
2023		18
2024		19
2025		5
Principal maturities		1,665
Debt issuance costs		(18	)
Total long term debt, net	$	1,647

Table of Contents

RiceBran Technologies

Notes to Unaudited Condensed Consolidated Financial Statements

NOTE 10. EQUITY, SHARE-BASED COMPENSATION AND WARRANTS

A summary of equity activity follows (in thousands, except share amounts).

	Shares
	Preferred				Preferred		Common			Accumulated
	Series G		Common		Stock		Stock			Deficit			Equity
Balance, December 31, 2020		225		45,238,087	$	112	$	322,218		$	(298,910	)	$	23,420
Common stock awards under equity incentive plans		-		29,943		-		250			-			250
Common stock issued to vendor		-		6,000		-		3			-			3
Other		-		-		-		(3	)		-			(3	)
Net income		-		-		-		-			591			591
Balance, March 31, 2021		225		45,274,030		112		322,468			(298,319	)		24,261
Common stock awards under equity incentive plans		-		29,643		-		290			-			290
Common stock issued to vendor		-		6,000		-		5			-			5
Exercise of common stock warrants		-		177,936		-		171			-			171
Other		-		-		-		3			-			3
Net loss		-		-		-		-			(1,923	)		(1,923	)
Balance, June 30, 2021		225		45,487,609	$	112	$	322,937		$	(300,242	)	$	22,807

	Shares											Accumulated Other
	Preferred				Preferred		Common		Accumulated			Comprehensive
	Series G		Common		Stock		Stock		Deficit			Loss			Equity
Balance, December 31, 2019		225		40,074,483	$	112	$	318,811	$	(287,180	)	$	-		$	31,743
Common stock awards under equity incentive plans		-		17,534		-		312		-			-			312
Net loss		-		-		-		-		(3,033	)		-			(3,033	)
Balance, March 31, 2020		225		40,092,017	$	112	$	319,123	$	(290,213	)	$	-		$	29,022
Common stock awards under equity incentive plans		-		16,500		-		316		-			-			316
Common stock issued to vendors		-		31,304		-		36		-			-			36
Exercise of common stock warrants		-		67,577		-		12		-			-			12
Other comprehensive loss		-		-		-		-		-			(48	)		(48	)
Net loss		-		-		-		-		(3,949	)		-			(3,949	)
Balance, June 30, 2020		225		40,207,398	$	112	$	319,487	$	(294,162	)	$	(48	)	$	25,389

Share-based compensation by type of award follows (in thousands).

	Three Months Ended
	June 30, 2021		March 31, 2021
Common stock, vested at issuance and nonvested at issuance	$	32	$	28
Stock options		35		36
Restricted stock units		223		186
Compensation expense related to common stock awards issued under equity incentive plan	$	290	$	250

In the three months ended March 31, 2021, we issued to an employee 29,943 shares of common stock (average $0.94 grant date fair value per share) which were vested at issuance. In the three months ended

SEC Form 10-Q filed by RiceBran Technologies