Attached files
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| EX-99.1 - PRESS RELEASE - Loop Industries, Inc. | lp_ex991.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of
Report (Date of earliest event reported)
July 28, 2021
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LOOP INDUSTRIES, INC.
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(Exact name of registrant as specified in its charter)
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Nevada
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000-54786
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27-2094706
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(State or other jurisdiction of incorporation)
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(Commission File Number)
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(IRS Employer Identification No.)
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480 Fernand-Poitras
Terrebonne, Quebec, Canada, J6Y 1Y4
(Address
of principal executive offices, including zip code)
(450) 951-8555
(Registrant’s
telephone number, including area code)
Not Applicable
(Former
name or former address, if changed since last report)
Check
the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant
under any of the following provisions (see General Instruction A.2.
below):
☐ Written communications pursuant to Rule 425
under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12
under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to
Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
☐ Pre-commencement communications pursuant to
Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Securities
registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common stock, par value $0.0001 per share
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LOOP
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Nasdaq Global Market
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Indicate
by check mark whether the registrant is an emerging growth company
as defined in Rule 405 of the Securities Act of 1933 (§230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of
1934 (§240.12b-2 of this chapter). 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. ☐
Item 1.01 Entry into a Material Definitive Agreement.
On July 29, 2021, the Loop Industries, Inc. (the
“Company”) announced the closing (the
“Closing”) of its previously announced issuance and
sale in a private offering of the Shares and the Warrants (defined
below) for aggregate gross proceeds of approximately $56.5
million.
Based on 42,445,351 shares of common stock and issued and
outstanding as of July 14, 2021, immediately following the Closing,
the Purchaser (defined below) will hold approximately 10.0% of the
issued and outstanding Common Stock. The Company intends to use the
proceeds toward the funding of its planned Infinite Loop™
manufacturing facility at its recently acquired site in Becancour,
Quebec.
For the sale of the Shares, the Company relied on Section 4(a)(2)
of the Securities Act of 1933, as amended or the private offering
safe harbor provision of Rule 506 of Regulation D promulgated
thereunder based on the following factors: (i) the number of
offerees or purchasers, as applicable, (ii) the absence of general
solicitation, (iii) representations obtained from the purchasers
relative to their accreditation and/or sophistication and/or their
relationship to the company (directors and officers), (iv) the
provision of appropriate disclosure, and (v) the placement of
restrictive legends on the certificates reflecting the securities
coupled with investment representations obtained from the
purchasers.
Amendment to Securities Purchase Agreement
As previously announced, on June 22, 2021, Company entered into
that certain Securities Purchase Agreement (the “Purchase
Agreement”) by and between the Company and SK global chemical
Co., Ltd, an accredited investor (the “Purchaser”). As
previously disclosed and pursuant to the Purchase Agreement, the
Company agreed to issue and sell to the Purchaser the following
securities:
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an
aggregate of 4,714,813 shares (the “Shares”) of the
Company’s common stock (the “Common
Stock”);
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warrants
to purchase 4,714,813 shares of Common Stock for an exercise price
of $15.00 (the “First Tranche Warrants”), with an
expiration date of the third anniversary of the issue
date;
●
warrants
to purchase 2,357,407 shares of Common Stock for an exercise price
of $20.00 (the “Second Tranche Warrants”), with an
expiration date of the earlier of (A) the date that is the third
anniversary of the First Plant Milestone (as defined in the Second
Tranche Warrants), (B) the expiration of the JV Negotiation Period
(as defined in the Second Tranche Warrants), provided that the
Joint Venture Transaction Agreements (as defined in the Second
Tranche Warrants) have not been executed by the expiration of the
JV Negotiation Period and (C) the third anniversary of the BDP Date
(as defined in the Second Tranche Warrants), provided that the
First Plant Milestone has not occurred as of such date;
and
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warrants
to purchase 461,298 shares of Common Stock for an exercise price of
$11.00 (the “Third Tranche Warrants,” and together with
First Tranche Warrants and the Second Tranche Warrants, the
“Warrants”), with an expiration date of June 14,
2022.
On July 29, 2021, the parties to the Purchase Agreement entered
into an amendment to such Purchase Agreement (the
“Amendment”). Pursuant to the Amendment, the Purchaser
may only exercise the First Tranche Warrant at any time beginning
on January 29, 2022 and the Second Tranche Warrant at any time on
or after the later to occur of (i) January 29, 2022 and (ii) the
first business day following the First Plant Milestone (as defined
in the Second Tranche Warrant) prior to its expiration date. The
Amendment also amended the form of Investors Rights Agreement (as
defined below) to be executed as of Closing.
Investors Rights Agreement
As previously disclosed on June 22, 2021, on July 29, 2021, the
Company also entered into an Investors Rights Agreement (the
“Investors Rights Agreement”) by and among the Company,
the Purchaser, and Daniel Solomita, in his individual capacity and
solely for the purposes of the voting arrangement in the Purchase
Agreement. Pursuant to the Investors Rights Agreement, effective as
of the July 29, 2021, the Company’s board of directors (the
“Board”) will appoint a designee of the Purchaser to
the Board (the “Investor Designee”), subject to the
terms and conditions of the Investors Rights Agreement. The
Purchaser will have the right to require the Board to nominate its
designee for election to the Board until the earlier to occur of
(i) the date that the Purchaser and its affiliates beneficially own
less than 4,000,000 shares of Common Stock or (ii) the date that
Purchaser and its affiliates beneficially own a number of shares of
the Common Stock equivalent to less than 5.0% of the number of
shares of Common Stock issued and outstanding.
The foregoing descriptions of the Purchase Agreement, the
Amendment, Investors Rights Agreement and form of Warrants are
summaries of each and are qualified in their entirety by the text
of the Purchase Agreement, which was filed with the Company’s
Quarterly Report on Form 10-Q for the period ended May 31, 2021,
and the text of the Amendment, Investors Rights Agreement and form
of Warrants, respectively, copies of which will be filed as
exhibits to the Company’s Quarterly Report on Form 10-Q for
the period ended August 31, 2021.
The foregoing agreements have been included to provide investors
with information regarding its terms. They are not intended to
provide any other factual information about the Company and its
subsidiaries and affiliates. The representations and warranties
contained in the Purchase Agreement were made only for purposes of
the Purchase Agreement (together with the exhibits thereto) and as
of specific dates, are solely for the benefit of the parties to the
Purchase Agreement, may be subject to limitations agreed upon by
the contracting parties, may have been made for the purposes of
allocating contractual risk between the parties to the Purchase
Agreement instead of establishing these matters as facts, and may
be subject to standards of materiality applicable to the
contracting parties that differ from those applicable to investors.
Investors are not third-party beneficiaries to the representations
and warranties contained in the Purchase Agreement and should not
rely on the representations and warranties or any descriptions
thereof as characterizations of the actual state of facts or
condition of the parties thereto or any of their respective
subsidiaries or affiliates. Moreover, information concerning the
subject matter of representations and warranties may change after
the date of the Purchase Agreement, which subsequent information
may or may not be fully reflected in the Company’s public
disclosures.
Item 3.03 Material Modification to Rights of Security
Holders.
Certificate of Amendment to Designation of Series A Preferred
Stock
On July 28, 2021, in connection with the Closing, the Company
certified with the Secretary of State of the State of Nevada an
amendment (the “Certificate Amendment”) to the
Company’s Certificate of Designation, dated February 19, 2016
(the “Certificate of Designation”), establishing the
voting powers, designations, preferences, limitations, restrictions
and relative rights of the Series A Preferred Stock of the Company.
Pursuant to the Certificate Amendment, the definition of
“Transfer” in Section 8(g) of the Certificate of
Designation is amended to exclude from the definition of
“Transfer” the grant of a proxy to officers or
directors of the Company at the request of the Board in connection
with actions to be taken at an annual or special meeting of
stockholders or the entering into a support, voting, tender or
similar agreement, arrangement or understanding (with or without
granting a proxy) in connection with a transaction that was
approved by the Board of Directors, including the Series A
Director.
The foregoing descriptions of the Certificate Amendment is
qualified in its entirety by the text of the Certificate Amendment,
a copy of which will be filed as exhibit to the Company’s
Quarterly Report on Form 10-Q for the period ended August 31,
2021.
Item 5.02. Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
On July
29, 2021, in connection with Closing, the Board elected Mr.
Jonghyuk Lee as a member of the Board.
Mr. Lee
was selected as a director of the Company pursuant to the
investment by the Purchaser into the Company (the
“Investment”). Mr. Lee serves as Vice President of
Green Business of the Purchaser. There are no family relationships
between Mr. Lee and any director, executive officer or person
nominated or chose by the Company to become a director or executive
office of the company within the meaning of
Item 401(d) of Regulation S-K under the
U.S. Securities Act of 1933 (“Regulation
S-K”).
In
connection with the Investment, as previously disclosed on
June 22, 2021 and disclosed herein, the Company entered into the
Purchase Agreement and the Amendment. Pursuant to the Purchase
Agreement, the Amendment and the Investors Rights Agreement, the
Purchaser has the right to nominate one director to be appointed to
the Company’s board of directors and Mr. Daniel Solomita has
agreed to vote all shares of Common Stock he then owns or has
control over to elect such director.
Other
than as mentioned above, since the beginning of the Company’s
last fiscal year, the Company has not engaged in any transaction in
which Mr. Lee had direct or indirect material interest within the
meaning of Item 404(a) of Regulation
S-K.
Mr. Lee
has executed the Company’s standard form of indemnification
agreement, a copy of which has been previously filed as Exhibit
10.1 to the Company’s Current Report on Form 8-K filed with
the Securities and Exchange Commission on June 30,
2017.
Item 8.01 Other Events.
On August 2, 2021, the Company issued a press release announcing
the Closing. A copy of this press release is furnished hereto as
Exhibit 99.1.
Investors and others should note that we announce material
financial information to our investors using our investor relations
web site (http://www.loopindustries.com/en/investors/home), SEC
filings, press releases, public conference calls and webcasts. We
use these channels, as well as social media, to communicate with
our members and the public about our company, our services and
other issues. It is possible that the information we post on social
media could be deemed to be material information. Therefore, we
encourage investors, the media, and others interested in our
company to review the information we post on the United States
social media channels listed on our investor relations web
site.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
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Exhibit
Number
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Description
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Press
Release dated August 2, 2021
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly
authorized.
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LOOP INDUSTRIES, INC.
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Date: August 2, 2021
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By:
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/s/ Drew Hickey
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Drew Hickey
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Chief Financial Officer
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