SCHEDULE: BranchOut Food Inc. Shareholder Sells Stake

Kaufman Kapital LLC has sold a significant portion of its BranchOut Food Inc. common stock holdings in a privately negotiated block transaction.

Summary

• Kaufman Kapital LLC, through Daniel L. Kaufman, has filed an amendment to its Schedule 13D, reporting the sale of 1,189,676 shares of BranchOut Food Inc. common stock on June 2, 2026.
• This sale was conducted in a privately negotiated block transaction at a price of $3.06 per share, generating gross proceeds of approximately $3,640,409.
• Following this sale, the Reporting Persons' direct holdings in BranchOut Food Inc. common stock are reduced to 500,000 shares.
• These remaining shares were acquired on May 7, 2026, through the exercise of a $1.50 warrant.
• The Reporting Persons also hold a Senior Secured Convertible Promissory Note with a principal balance of $2,900,000 and approximately $680,000 in accrued interest, convertible at $0.7582 per share.
• A beneficial ownership limitation restricts conversion of the note to a maximum of 9.99% of the outstanding common stock.
• The Reporting Persons continuously evaluate their investment and may acquire or dispose of additional securities, subject to market conditions and legal compliance.

Sentiment

Score: 5

Explanation: StockSavvy.ai views this filing as neutral to slightly negative due to the significant sale of shares by a major reporting person, although the sale was executed at a reasonable price and the investor retains a convertible note with potential upside.

Positives

• Successful sale of a large block of shares at a price of $3.06 per share, realizing significant proceeds of approximately $3.64 million.
• The sale was executed through a privately negotiated block transaction, indicating a potentially efficient exit for a substantial holding.
• The remaining 500,000 shares are held outright, providing a direct stake in the company.
• The convertible note offers potential upside if the company's stock price increases, with a conversion price of $0.7582, significantly lower than the recent sale price.

Negatives

• Significant reduction in direct shareholding by a major reporting person.
• The sale of over 1.18 million shares could be interpreted as a lack of confidence in the short-term prospects of the company, potentially impacting market sentiment.
• The beneficial ownership limitation on the convertible note restricts the ability to increase stake significantly through conversion, capping potential upside from that instrument.

Risks

• The Reporting Persons may sell some or all of the remaining 500,000 shares if they are registered for resale or can be sold in accordance with applicable law.
• Future sales of directly held Common Stock could potentially increase the number of shares issuable upon conversion of the Convertible Note, but without increasing the Reporting Persons' aggregate beneficial ownership above the Maximum Percentage.
• The company's financial condition, results of operations, and business prospects are continuously evaluated by the Reporting Persons, suggesting potential for further divestment if these factors are unfavorable.

Future Outlook

The Reporting Persons continuously evaluate their investment in the Issuer based on various factors including financial condition, results of operations, business prospects, and market conditions. They may acquire additional securities, including through conversion of the Convertible Note (subject to the beneficial ownership limitation), or dispose of some or all of their securities through various means. Any such transactions will depend on a variety of factors and will be effected at any time and from time to time, subject to applicable law.

Management Comments

• The Reporting Persons continuously evaluate their investment in the Issuer based on a variety of factors, including the Issuer's financial condition, results of operations, business prospects, general market and economic conditions, and other factors.
• Depending on such evaluation, the Reporting Persons may from time to time acquire additional securities of the Issuer, including through conversion of outstanding Convertible Note principal and accrued interest, subject to the Beneficial Ownership Limitation described below, dispose of some or all of the securities of the Issuer, including through open-market sales, privately negotiated transactions, block trades, registered offerings or otherwise, or take any other action with respect to their investment in the Issuer as they may deem appropriate.
• The Reporting Persons may sell some or all of the 500,000 shares currently held directly by Kaufman Kapital if and when such shares are registered for resale or otherwise may be sold in accordance with applicable law.
• Sales of directly held Common Stock may increase the number of shares issuable upon conversion of the Convertible Note that may be acquired without exceeding the Beneficial Ownership Limitation, without increasing the Reporting Persons' aggregate beneficial ownership above the Maximum Percentage.

Industry Context

StockSavvy.ai notes that significant block trades by major shareholders, as reported in this Schedule 13D filing, can signal shifts in investor sentiment and potentially influence market perception of BranchOut Food Inc.'s stock. The sale at $3.06 per share, while realizing substantial proceeds, also reduces the direct stake of a key investor, which could be a point of focus for other market participants.

Comparison to Industry Standards

• The sale of 1,189,676 shares represents approximately 7.77% of the company's outstanding shares (15,316,030 as of May 14, 2026), which is a substantial block trade. In the food and beverage sector, block trades of this magnitude can be executed through various channels, including institutional sales desks, private negotiations, or registered offerings, depending on the urgency and desired price.
• The conversion price of the convertible note ($0.7582) is significantly lower than the recent sale price ($3.06), suggesting that if the company's performance improves and its stock price rises, the note holder has a strong incentive to convert. This is a common strategy in venture debt or bridge financing, aiming to provide downside protection for the lender while offering upside participation.
• The 9.99% beneficial ownership limitation is a standard regulatory threshold designed to prevent a single investor from gaining excessive control without making a formal takeover bid. Many institutional investors and activist funds operate within similar ownership caps.

Stakeholder Impact

• Shareholders: The sale of a large block of shares may lead to short-term price pressure or signal a change in investor sentiment. However, the sale was at a specific price, and the remaining convertible note offers potential future upside.
• Management: The reduction in a significant shareholder's direct stake might be viewed with caution, but the ongoing investment evaluation suggests continued engagement.
• Creditors: The sale of shares does not directly impact the company's debt obligations, but a significant shift in major shareholder sentiment could indirectly affect the company's ability to raise future debt or equity.

Next Steps

• The Reporting Persons will continue to evaluate their investment in BranchOut Food Inc.
• The Reporting Persons may acquire additional securities or dispose of existing securities.
• The Reporting Persons may sell the remaining 500,000 shares if registered for resale or otherwise legally permissible.
• The Reporting Persons may convert the Convertible Note, subject to the 9.99% beneficial ownership limitation.

Key Dates

Recommendation

The filing indicates a significant reduction in direct shareholding by a key investor, which can be a negative signal. However, the investor retains a substantial convertible note with a favorable conversion price and continues to evaluate their investment, suggesting potential for future engagement or upside. The current situation warrants a 'hold' recommendation pending further developments or clarity on the investor's long-term strategy.

Keywords

BranchOut Food Inc., Schedule 13D, Kaufman Kapital LLC, Daniel L. Kaufman, Shareholder, Block Trade, Convertible Note, Beneficial Ownership, SEC Filing, Common Stock