Blueprint
Filed
pursuant to Rule 424(b)(5)
Registration
No. 333-234133
2,081,451 Shares of Common Stock
Offered by Selling Stockholders
This prospectus relates to an aggregate of up to
2,081,451 shares of our Common Stock, par value $0.0001 per share,
that we have issued to certain of the Selling Stockholders, and
that we have issued or may issue upon conversion or exercise of
certain of our notes or warrants, as applicable, and that may be
resold from time to time from Selling Stockholders named in this
prospectus. The registration of the offer and sale of the shares of
Common Stock covered by this prospectus does not necessarily mean
that any of the shares of
Common Stock will be offered or sold by the Selling
Stockholders.
We
will receive no proceeds from any sale or disposition of the shares
of our Common Stock registered hereunder that are sold by the
Selling Stockholders, or interests therein, but we have agreed to
pay certain registration expenses.
Our
Common Stock is listed on the Nasdaq Global Market under the symbol
“LOOP.” On October 21, 2019, the reported closing sale
price of our Common Stock on the Nasdaq Global Market was $11.25
per share.
The
Selling Stockholders identified in this prospectus, or their
permitted transferees or other successors-in-interest, may offer
the shares from time to time through public or private transactions
at prevailing market prices, at prices related to prevailing market
prices, or at privately negotiated prices. We provide additional
information about how the Selling Stockholders may sell their
shares of Common Stock in the section entitled “Plan of
Distribution” beginning on page 13 of this prospectus. We
will not be paying any underwriting discounts or selling
commissions in connection with any offering of Common Stock under
this prospectus.
Investing in our Common Stock involves risks. Please carefully read
the information under the headings “Risk
Factors” beginning on
page 5 of this prospectus and “Item 1A—Risk
Factors” of our most recent report on Form 10-K or 10-Q that
is incorporated by reference in this prospectus before you invest
in our Common Stock.
Neither the Securities and Exchange Commission nor any other
regulatory body has approved or disapproved of these securities or
passed upon the accuracy or adequacy of this prospectus. Any
representation to the contrary is a criminal offense.
Prospectus
dated October 22, 2019.
TABLE OF CONTENTS
Page
About
This Prospectus
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1
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Prospectus
Summary
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2
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Risk
Factors
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5
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Cautionary
Note Regarding Forward-Looking Statements
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6
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Use of
Proceeds
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7
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Description
of Common Stock to be Registered
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8
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Selling
Stockholders
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10
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Plan of
Distribution
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13
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Legal
Matters
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15
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Experts
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15
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Where
You Can Find More Information
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15
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Information
Incorporated by Reference
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16
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ABOUT THIS PROSPECTUS
This prospectus is part
of a registration statement on Form S-3 that we filed with the
United States Securities and Exchange Commission (the
“SEC”). Under this registration statement, the Selling
Stockholders may sell, at any time and from time to time, in one or
more offerings, up to 2,081,451 shares of Common
Stock. We will not
receive any of the proceeds from the sale of shares of our Common
Stock by the Selling Stockholders.
You
should not assume that the information contained in this prospectus
is accurate on any date subsequent to the date set forth on the
front cover of this prospectus or that any information we have
incorporated by reference is correct on any date subsequent to the
date of the document incorporated by reference, even though this
prospectus is delivered or shares of Common Stock are sold or
otherwise disposed of on a later date. It is important for you to
read and consider all information contained in this prospectus,
including the documents incorporated by reference therein, in
making your investment decision. You should also read and consider
the information in the documents to which we have referred you
under the captions “Where You Can Find More
Information” and “Information Incorporated by
Reference” in this prospectus.
We
have not authorized any dealer, salesman or other person to give
any information or to make any representation other than those
contained or incorporated by reference in this prospectus. You must
not rely upon any information or representation not contained or
incorporated by reference in this prospectus. This prospectus does
not constitute an offer to sell or the solicitation of an offer to
buy any of our shares of Common Stock other than the shares of our
Common Stock covered hereby, nor does this prospectus constitute an
offer to sell or the solicitation of an offer to buy any shares of
Common Stock any jurisdiction to any person to whom it is unlawful
to make such offer or solicitation in such jurisdiction. Persons
who come into possession of this prospectus in jurisdictions
outside the United States are required to inform themselves about,
and to observe, any restrictions as to the offering and the
distribution of this prospectus applicable to those
jurisdictions.
For
investors outside the United States: Neither us nor the Selling
Stockholders have done anything that would permit our public
offering or possession or distribution of this prospectus in any
jurisdiction where action for that purpose is required, other than
in the United States. Persons outside the United States who come
into possession of this prospectus must inform themselves about,
and observe any restrictions relating to, the offering of the
shares of Common Stock and the distribution of this prospectus
outside of the United States.
Except
where the context otherwise requires or where otherwise indicated,
the terms “we,” “us,” “our,”
“Loop Industries,” “Loop” and “the
company” refer to Loop Industries, Inc., a Nevada
corporation, and its consolidated subsidiaries. References to the
“Selling Stockholders” refer to the stockholders listed
herein under the heading “Selling Stockholders” and
each of their donees, pledgees, transferees or other
successors-in-interest.
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PROSPECTUS SUMMARY
This summary highlights selected information that is presented in
greater detail elsewhere, or incorporated by reference, in this
prospectus. It does not contain all of the information that may be
important to you and your investment decision. Before investing in
our Common Stock, you should carefully read this entire prospectus,
including the matters set forth under the sections of this
prospectus captioned “Risk Factors” in this prospectus,
the financial statements and related notes and other information
that we incorporate by reference herein, including our most recent
report on Form 10-K or on Form 10-Q. Unless the context otherwise
requires, the terms “Loop Industries, Inc.,”
“Loop Industries,” “Loop,” “the
company,” “we,” “us” and
“our” in this prospectus refer to the consolidated
operations of Loop Industries, Inc. and its consolidated
subsidiaries as a whole.
Loop Industries, Inc.
Overview
Loop is
a technology and licensing company whose mission is to accelerate
the world’s shift toward sustainable plastic and away from
our dependence on fossil fuels. Loop owns patented and proprietary
technology that depolymerizes no and low value waste PET plastic
and polyester fiber, including plastic bottles and packaging,
carpet and polyester textile of any color, transparency or
condition and even ocean plastics that have been degraded by the
sun and salt, to its base building blocks (monomers). The monomers
are filtered, purified and repolymerized to create virgin-quality
Loop™ branded PET plastic resin and polyester fiber suitable
for use in food-grade packaging to be sold to consumer goods
companies to help them meet their sustainability objectives.
Through our customers and production partners, Loop is leading a
global movement toward a circular economy by commercializing a
leading-edge technology which will ensure plastic stays in the
economy for a more sustainable future for all.
Our Technology
The
power of our technology lies in its ability to divert and recover
what is currently considered plastic waste from landfills, rivers,
oceans and natural areas for use as feedstock to create new,
sustainable, infinitely recyclable Loop™ PET plastic resin
and polyester fiber. We believe our technology can deliver a
cost-effective and profitable virgin quality PET plastic resin
suitable for use in food-grade packaging.
Our
Generation I technology process yielded polyethylene terephthalate
(“PTA”) and monoethylene glycol (“MEG”),
two common monomers of PET plastic, through depolymerization. While
monomers were of excellent purity and strong yield, we continued to
challenge ourselves to drive down cost and eliminate inputs. It was
during this process that we realized we could eliminate water and
chlorinated solvents from the purification process, reduce the
number of reagents from five to two and reduce the number of
purification steps from 12 to four, if we shifted from the
production of PTA to the production of dimethyl terephthalate
(“DMT”), another proven monomer of PET plastic that is
far simpler to purify. Since June 2018, when we transitioned to our
Generation II technology and our newly built industrial pilot
plant, we continue to see consistently high monomer yields,
excellent purity and improved conversion costs.
This
shift, from producing the monomer PTA to the monomer DMT was a
pivotal moment for Loop. The Generation II technology is more
cost-effective, easier to commercialize, more economical for our
customers and requires less energy and fewer resource inputs than
conventional PET production processes. We believe it to be one of
the most environmentally sustainable methods for producing virgin
quality food-grade PET plastic in the world.
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To
protect our technology, and in addition to the patents we hold for
our Generation I (or “GEN I”) technology, we have
patents pending for our Generation II (or “GEN II”)
technology in various jurisdictions around the world. On April 9,
2019, the GEN II U.S. patent was formally approved and issued.
Freedom to Operate searches have also been conducted that indicate
no conflicts with any of our existing patents or applications and
we adhere to rigorous internal data and confidentiality
controls.
Corporate Information and History
We were
originally incorporated in Nevada in March 2010 under the name
Radikal Phones Inc., which was changed to First American Group Inc.
in October 2010. On July 29, 2015, we completed a reverse
acquisition of Loop Holdings, Inc., whereby we acquired all of its
issued and outstanding common shares in a share exchange for
approximately 78.1% of the capital stock of our company at the
time. The depolymerization business of Loop Holdings, Inc. became
our sole operating business. On June 22, 2015, our board of
directors approved a change in the fiscal year end date from
September 30 to the last day of February. On July 21, 2015 we
changed our name to Loop Industries, Inc. Loop Holdings, Inc. was
originally incorporated in Nevada on October 23, 2014. On March 9,
2017, Loop Holdings, Inc. merged with and into us.
Our
principal executive offices are located at 480 Fernand-Poitras
Street, Terrebonne, Québec J6Y 1Y4 Canada. Our telephone
number is (450) 951-8555. Our website address is
http://www.loopindustries.com. The information contained on, or
that can be accessed through, our website is not incorporated by
reference in this prospectus and should not be considered to be
part of this prospectus.
THIS OFFERING
The
shares of Common Stock offered
in this prospectus relate to the potential resale of an aggregate
of 2,081,451 shares of Common
Stock. Immediately following this offering, we will have
40,629,221 shares of Common
Stock outstanding, assuming the conversion of all notes and
exercise of all the warrants underlying the shares of Common Stock
registered herein. The number of shares of our common stock
outstanding after this offering is based on 39,032,528 shares of
common stock outstanding as of October 7, 2019.
On
March 4, 2019, we issued 150,000 shares of Common Stock (the “Plaintiff Common
Shares”) and 500,000 warrants exercisable for shares of our
Common Stock (the
“Plaintiff Warrants”) pursuant to a settlement
agreement and release (the “Settlement Agreement”) that
we entered into with certain of the Selling Stockholders on
February 26, 2019. 300,000 of the Plaintiff Warrants are
exercisable for shares of the company’s Common Stock at an exercise price of $12.00
per share for a period of 24 months following the date of the
Settlement Agreement. The remaining 200,000 Plaintiff Warrants were
exercisable for shares of the company’s Common Stock at an exercise price of $11.00
per share for a period of 24 months, but in the event the
company’s 5-day average trading price during any period in
the first 18 months following the date of the Settlement Agreement
is above $11 per share, then the exercise term of such warrants
shall automatically be reduced to 18 months instead of 24 months.
Because Loop’s 5-day average trading price was above $11 per
share during the 5-day period of July 1, 2019 to July 8, 2019, the
exercise term of such warrants has been reduced to 18 months
instead of 24 months. As part of the Settlement Agreement, we
agreed to file this registration statement to register the resale
of the shares issued and issuable pursuant to the Plaintiff
Warrants to the Selling Stockholders.
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On
November 13, 2018 and January 3, 2019, we issued an aggregate
principal amount of $2,650,000 convertible promissory notes (the
“2018 Convertible Notes”). The 2018 Convertible Notes
included related warrants (the “2018 Convertible Note
Warrants”), which are exercisable for an additional fifty
percent (50%) of the shares of Common
Stock issued upon the conversion of the 2018 Convertible
Notes. On April 5, 2019, we entered into an Amendment and
Conversion Agreement to the November 2018 Convertible Notes, which
provided for voluntary conversion of the 2018 Convertible Notes at
a conversion price of $8.55, and on April 8, 2019, the company
entered into amendments to the 2018 Convertible Note Warrants,
which set the exercise price as $8.55 per share. On April 5, 2019,
all holders of 2018 Convertible Notes elected to convert their
notes into shares of Common
Stock of the company at the conversion price of $8.55 per
share. This registration statement registers the shares of
Common Stock of the company
issued pursuant to the conversion of the 2018 Convertible Notes and
issuable pursuant to the 2018 Convertible Note
Warrants.
On
January 15, 2019 and January 21, 2019, we issued an aggregate
principal amount of $4,900,000 convertible promissory notes (the
“2019 Convertible Notes” and, together with the 2018
Convertible Notes, the “Notes”), which mature on
January 15, 2020 and January 21, 2020, respectively, and
automatically convert into shares of our Common Stock at the price per share equal
to $8.10 (the “2019 Convertible Note Conversion
Price”). The 2019 Convertible Note Conversion Price may be
adjusted in the event that we issue common shares in a private sale
or offering at a lower price per share (the “2019 Convertible
Note New Share Price”) within 180 days of the closing date.
The 2019 Convertible Note New Share Price would become the new
conversion price of the 2019 Convertible Note notes, the 2019
Convertible Note New Issuance Price, which would impact the number
of shares and warrants issued. All accrued interest shall be paid
in cash or in shares of the company’s Common Stock, at the discretion of each
holder of a 2019 Convertible Note. If interest is paid in
company’s Common Stock,
the price per share shall be equal to the trading price of the
company’s Common Stock on
the Nasdaq Global Market at the close of the market on the date
immediately preceding the maturity date.
The
2019 Convertible Notes include related warrants (the “2019
Convertible Note Warrants” and, together with the 2018
Warrants, the “Warrants”), which are exercisable for an
additional fifty percent (50%) of the shares of Common Stock issued upon the conversion of
the 2019 Convertible Notes. The per share purchase price (the
“2019 Convertible Note Exercise Price”) for each share
of Common Stock issuable
pursuant to the 2019 Convertible Note Warrant shall be equal to
115% of the 2019 Convertible Note Conversion Price or the 2019
Convertible Note New Issuance Price, as applicable. Each 2019
Convertible Note Warrant expires twenty-four (24) months from the
date of the conversion of the January 2019 Convertible Notes (the
“2019 Convertible Note Warrant Expiration Date”) and
holders of the 2019 Convertible Notes may exercise the 2019
Convertible Note Warrants at any time prior to the 2019 Convertible
Note Warrant Expiration Date. On April 4, 2019, we entered into an
amendment (the “2019 Purchase Agreement Amendment”) to
the Note and Warrant Purchase Agreement dated as of January 15,
2019, among the company and certain accredited investors (the
“2019 Purchase Agreement”), the 2019 Convertible Notes
and the 2019 Convertible Note Warrants. This registration statement
registers the shares of Common
Stock of the company issuable pursuant to the conversion of
the 2019 Convertible Notes and pursuant to the 2019 Convertible
Note Warrants.
Additionally, the
Selling Stockholders may offer shares of our Common Stock, par value $0.0001 per share,
to the extent such shares were issued and outstanding prior to the
original date of filing of the registration statement to which this
prospectus relates.
See
“Plan of Distribution” and “Description of Common
Stock to be Registered” for additional information concerning
this registration statement.
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RISK FACTORS
An
investment in our Common Stock involves a high degree of risk.
Prior to making a decision about investing in our Common Stock, you
should carefully consider the risks, uncertainties and assumptions
discussed under “Risk Factors” in our most recent
Annual Report on Form 10-K or Quarterly Reports on Form 10-Q and in
other documents, which are incorporated herein by reference into
this prospectus, and may be amended, supplemented or superseded
from time to time by other reports we file with the SEC in the
future, as well as the risk factors and other information contained
in or incorporated by reference into any accompanying prospectus
supplement. The risks and uncertainties we have described are not
the only ones we face. Additional risks and uncertainties not
presently known to us or that we currently deem immaterial may also
affect our operations.
For more information about our SEC filings, please see “Where
You Can Find More Information” and “Information
Incorporated by Reference.”
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus, any prospectus supplement and the documents we
incorporate by reference herein and therein contain forward-looking
statements that relate to future events or our future financial
performance and involve known and unknown risks, uncertainties and
other factors that may cause our actual results, levels of
activity, performance or achievements to differ materially from any
future results, levels of activity, performance or achievements
expressed or implied by these forward-looking statements. Words
such as, but not limited to, “may”, “will”,
“should”, “could”, “expects”,
“plans”, “intends”,
“anticipates”, “believes”,
“estimates”, “predicts”,
“potential” or “continue” or the negative
of such terms and other comparable terminology.
These
forward-looking statements include, without limitation, statements
about our market opportunity, our strategies, ability to improve
and expand our capabilities, competition, expected activities and
expenditures as we pursue our business plan, the adequacy of our
available cash resources, regulatory compliance, plans for future
growth and future operations, the size of our addressable market,
market trends, and the effectiveness of the company’s
internal control over financial reporting. Although we believe that
the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity,
performance or achievements. Actual results may differ materially
from the predictions discussed in these forward-looking statements.
The economic environment within which we operate could materially
affect our actual results. Forward-looking statements are
inherently subject to risks and uncertainties, some of which cannot
be predicted or quantified. These risks and other factors include,
but are not limited to, those listed under “Risk
Factors” and “Management’s Discussion and
Analysis of Financial Condition and Results of Operations -
Critical Accounting Policies and Estimates” included in our
most recent Annual Report on Form 10-K filed with the SEC and the
description of material changes thereto, if any, included in our
Quarterly Reports on Form 10-Q or subsequent filings with the SEC.
Additional factors that could materially affect these
forward-looking statements and/or predictions include, among other
things: (i) commercialization of our technology and products, (ii)
our status of relationship with partners, (iii) development and
protection of our intellectual property and products, (iv) our need
for and ability to obtain additional financing, (v) industry
competition, (vi) regulatory and other legal compliance, (vii) the
exercise of the control over us by Mr. Daniel Solomita, our
President and Chief Executive Officer, Chairman of the Board of
Directors, (viii) other factors over which we have little or no
control, (ix) building our manufacturing facility, (x) and our
ability to sell our products in order to generate revenues, (xi)
our proposed business model and our ability to execute thereon,
(xii) whether the reassessment of our internal controls over
financial reporting could lead us to conclude that there were
deficiencies in its internal control over financial reporting that
constitute material weaknesses, (xiii) adverse effects on the
company’s business and operations as a result of increased
regulatory, media or financial reporting issues and practices,
rumors or otherwise and (xiv) other factors discussed in our
subsequent filings with the SEC.
Management has
included projections and estimates in this prospectus, which are
based primarily on management’s experience in the industry,
assessments of our results of operations, discussions and
negotiations with third parties and a review of information filed
by our competitors with the SEC or otherwise publicly
available.
In
addition, statements that “we believe” and similar
statements reflect our beliefs and opinions on the relevant
subject. These statements are based upon information available to
us as of the date of this prospectus, and while we believe such
information forms a reasonable basis for such statements, such
information may be limited or incomplete, and our statements should
not be read to indicate that we have conducted an exhaustive
inquiry into, or review of, all potentially available relevant
information. These statements are inherently uncertain and
investors are cautioned not to unduly rely upon these
statements.
We
caution readers not to place undue reliance on any such
forward-looking statements, which speak only as of the date made.
We disclaim any obligation subsequently to revise any
forward-looking statements to reflect events or circumstances after
the date of such statements or to reflect the occurrence of
anticipated or unanticipated events.
USE OF PROCEEDS
This
prospectus relates to the Common Stock that may be sold from time
to time by the Selling Stockholders who will receive all of the
proceeds from any sale of the shares of Common Stock. We will not
receive any of the proceeds from any sales of the shares of Common
Stock by the Selling Stockholders.
DESCRIPTION OF COMMON STOCK TO BE REGISTERED
The
following description summarizes the material terms of our Common
Stock. Because it is only a summary, it does not contain all the
information that may be important to you. For a complete
description of our Common Stock, you should refer to our articles
of incorporation, as amended, and our amended and restated bylaws
and to the provisions of applicable Nevada law. For a description
of our capital stock, you should refer to our registration
statement on Form 8-A (Commission File No. 001-38301), filed with
the SEC on November 17, 2017, including any subsequent amendment or
any report filed for the purpose of updating such description,
incorporated by reference in this prospectus.
Authorized Capitalization
Our authorized capital stock consists of
250,000,000 shares of Common Stock, $0.0001 par value, 1 share
designated as Series A preferred stock, $0.0001 par value,
and 24,999,999 shares as undesignated preferred stock,
$0.0001 par value, the rights,
preferences and privileges of which may be designated from time to
time by our board of directors.
As of October 4, 2019, there were
39,032,528 shares of our Common Stock issued and outstanding held
of record by approximately 77 stockholders and 1 share of Series A
preferred stock issued and outstanding held of record by 1
stockholder. The actual number of stockholders is greater than this
number of record holders, and includes stockholders who are
beneficial owners, but whose shares are held in street name by
brokers and other nominees. This number of holders of record also
does not include stockholders whose shares may be held in trust by
other entities.
Common Stock
Voting
The
holders of Common Stock are
entitled to one (1) vote for each share of Common Stock outstanding, and shall be
entitled to notice of any shareholders’ meeting. Except as
otherwise provided by the law of the State of Nevada, any corporate
action to be taken shall be authorized by a majority of the votes
cast by the shareholders. There are no cumulative rights to
voting.
Protective Provisions
There
are no protective provisions for holders of our Common Stock.
Dividends
Subject
to the rights of the preferred shareholders set forth in our
articles of incorporation, our board of directors shall have full
power and discretion, to determine out of legally available funds
what, if any, dividends or distributions shall be declared and
paid. Dividends may be paid in cash, in property, or in shares of
Common Stock. Shares of
Common Stock and Series A
preferred stock are treated equally and ratably, on a per share
basis, with respect to any dividend or distribution from us. If a
dividend is paid in the form of shares of Common Stock or rights to acquire
Common Stock, the holders of
Common Stock shall receive
Common Stock or rights to
acquire Common
Stock.
Liquidation Rights
If
there is a liquidation, dissolution or winding up of the company,
holders of our Common Stock and
Series A preferred stock would be entitled to share in our assets
remaining after the payment of liabilities equally and ratably, on
a per share basis.
Other Provisions
Holders
of our Common Stock have no
preemptive or conversion rights or other subscription rights, and
there are no redemption or sinking fund provisions applicable to
the Common Stock.
Transfer Agent and Registrar
The
transfer agent and registrar for our Common Stock is American Stock
Transfer & Trust Company, LLC. The transfer agent and
registrar’s address is 6201 15th Avenue, Brooklyn, New York
11219, and its telephone number is (718) 921-8206.
Listing
Our
Common Stock is listed on the NASDAQ Global Market under the symbol
“LOOP.”
Effect of Certain Provisions of our Articles of Incorporation and
Bylaws
Some
provisions of our articles of incorporation and bylaws contain
provisions that could make the following transactions more
difficult:
●
acquisition of us
by means of a tender offer;
●
acquisition of us
by means of a proxy contest or otherwise; or
●
removal of our
incumbent officers and directors.
These
provisions, summarized below, are designed to discourage coercive
takeover practices and inadequate takeover bids and to promote
stability in our management. These provisions are also designed to
encourage persons seeking to acquire control of us to first
negotiate with our board of directors.
●
Undesignated Preferred
Stock. The ability to authorize undesignated
preferred stock makes it possible for our board of directors to
issue one or more series of preferred stock with voting or other
rights or preferences that could impede the success of any attempt
to change control. These and other provisions may have the effect
of deferring hostile takeovers or delaying changes in control or
management of our company.
●
Protective Provisions. The Series A
preferred stock has certain protective provisions, as set forth in
our articles of incorporation, that could have an effect of
delaying, deferring or preventing a change in control of the
company.
SELLING STOCKHOLDERS
The
shares of our Common Stock being offered by the Selling
Stockholders are those previously issued to the Selling
Stockholders, and those issuable to the Selling Stockholders, upon
conversion of the Notes and upon exercise of the Warrants. For
additional information regarding the issuances of those shares of
our Common Stock, the Notes and Warrants, see “Prospectus
Summary—About this Offering” above. We are registering
the shares of our Common Stock in order to permit the Selling
Stockholders to offer the shares for resale from time to time.
Except for the ownership of the shares of our Common Stock and the
Warrants, the Selling Stockholders have not had any material
relationship with us within the past three years.
The following table details the name of
each Selling
Stockholders, the number of
shares of our Common Stock owned by each of the Selling
Stockholders,
based on
its ownership of the shares of our Common Stock, Notes and Warrants as
of October 4, 2019, and the
number of shares of our Common Stock that may be offered by
the Selling
Stockholders for resale under
this prospectus assuming exercise of
the Warrants held by the Selling Stockholders on that date, without
regard to any limitations on exercises. The following table has been prepared on the
assumption that all shares offered for resale by the Selling
Stockholders under this prospectus will be sold to parties
unaffiliated with the Selling Stockholders.
The
percentage of shares of our Common Stock owned by the Selling
Stockholders both prior to and following the offering of shares of
Common Stock pursuant to this prospectus, is based on 39,032,528
shares of our Common Stock outstanding as of October 4, 2019 and
does not take into account any shares of Common Stock issued by us
pursuant to this prospectus. We cannot advise you as to whether the
Selling Stockholders will in fact sell any or all of such shares of
our Common Stock.
Under the terms of the 2019 Convertible Notes and Warrants, a
Selling Stockholder may not exercise the 2019 Convertible Notes and
Warrants to the extent such exercise would cause such Selling
Stockholder, together with its affiliates, to beneficially own a
number of common shares which would exceed 19.9% of our then
outstanding common shares following such exercise, excluding for
purposes of such determination common shares issuable upon exercise
of the 2019 Convertible Notes and Warrants which have not been
exercised. The number of shares in the second column does not
reflect this limitation. The Selling Stockholders may sell all,
some or none of their shares in this offering. See “Plan of
Distribution.”
Unless otherwise indicated in the footnotes below,
each Selling
Stockholder named in the
following table possesses sole voting and investment power over the
shares listed. The information does not necessarily indicate
ownership for any other purpose. Unless otherwise noted below, the
address of each stockholder listed on the table is c/o Loop
Industries, Inc., 480 Fernand-Poitras, Terrebonne, Québec,
Canada, J6Y 1Y4. The actual number of shares held by each
Selling
Stockholder listed below may be
greater than this number held of record, as the Selling
Stockholder may be beneficial
owners of additional shares that are held in street name by brokers
and other nominees or in trust or by other
entities.
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Shares of Common
Stock Owned After the Offering
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Name of
Selling Stockholder
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Shares of Common
Stock Owned Prior to the Offering
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Shares of
Common Stock Being Registered for Resale (1) †
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Peter
Howser
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7,030
|
9,045(2)
|
1,000
|
*
|
Wan
Jin
|
6,030
|
9,045(3)
|
-
|
*
|
Qian
Shang
|
6,030
|
9,045(4)
|
-
|
*
|
Peidong
Xu
|
6,030
|
9,045(5)
|
-
|
*
|
David
A. Glassett
|
35,932
|
17,894(6)
|
24,000
|
*
|
James
H. Steinmann
|
61,132
|
17,894(7)
|
49,200
|
*
|
Jack
Cola
|
-
|
24,317(8)
|
-
|
*
|
Louis
Cola
|
-
|
24,317(9)
|
-
|
*
|
Philip
Cola
|
-
|
24,317(10)
|
-
|
*
|
Mitchell
Greenspoon
|
-
|
24,317(11)
|
-
|
*
|
Fred
Howser
|
92,090
|
27,135(12)
|
74,000
|
*
|
Giesco
Properties Inc.
|
25,000
|
29,182(13)
|
28,118
|
*
|
Miller
Family Legacy, LLC
|
163,485
|
45,225(14)
|
133,335
|
*
|
Z23
Capital Inc.
|
15,432
|
47,855(15)
|
-
|
*
|
Stone
Tower Investments LLC
|
-
|
48,635(16)
|
-
|
*
|
Goldie
Holdings Inc.
|
323,483
|
145,906(17)
|
187,900
|
*
|
CCBB
Investments Group, LLC
|
2,025,879
|
153,764(18)
|
1,923,370
|
4.68%
|
Everplus
F&B Fund, LLC
|
120,599
|
180,899(19)
|
-
|
*
|
Paul
M. Cugno
|
65,000
|
315,000(20)
|
-
|
*
|
Henry
Lorin
|
85,000
|
335,000(21)
|
-
|
*
|
|
346,246
|
583,614(22)
|
346,246
|
*
|
Total
|
3,384,398
|
2,081,451
|
2,767,169
|
6.73%
|
†
For the
purposes of calculating share ownership on this table, we have
assumed that the price per share to be used in calculating the
interest to be paid on the 2019 Convertible Notes is $12.83. All
accrued interest on the 2019 Convertible Notes shall be paid in
cash or in shares of the company’s Common Stock, at the discretion of each
holder of a 2019 Convertible Note. If interest is paid in
company’s Common Stock,
the price per share shall be equal to the trading price of the
company’s Common Stock on
the Nasdaq Global Market at the close of the market on the date
immediately preceding the maturity date.
*
Represents
ownership of less than 1%.
(1)
Assumes sale of all
shares offered hereby, although selling stockholders are not
obligated to sell any shares.
(2)
The number of
shares offered by the Selling Stockholder is comprised of (i) 6,030
shares of Common Stock held by the Selling Stockholder; and (ii)
3,015 shares of Common Stock issuable upon the exercise of warrants
held by the Selling Stockholder.
(3)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 6,030 shares of Common Stock held by the Selling Stockholder;
and (ii) 3,015 shares of Common Stock issuable upon the exercise of
warrants held by the Selling Stockholder.
(4)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 6,030 shares of Common Stock held by the Selling Stockholder;
and (ii) 3,015 shares of Common Stock issuable upon the exercise of
warrants held by the Selling Stockholder.
(5)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 6,030 shares of Common Stock held by the Selling Stockholder;
and (ii) 3,015 shares of Common Stock issuable upon the exercise of
warrants held by the Selling Stockholder.
(6)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 11,929 shares of Common Stock held by the Selling Stockholder;
and (ii) 5,965 shares of Common Stock issuable upon the exercise of
warrants held by the Selling Stockholder.
(7)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 11,929 shares of Common Stock held by the Selling Stockholder;
and (ii) 5,965 shares of Common Stock issuable upon the exercise of
warrants held by the Selling Stockholder.
(8)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 15,432 shares of Common Stock issuable upon the upcoming
conversion of a convertible note held by the Selling Stockholder,
which will convert on January 15, 2020; (ii) 7,716 shares of Common
Stock issued upon the exercise of warrants held by the Selling
Stockholder; (iii) 779 shares of Common Stock expected to be
issuable upon the upcoming conversion of the convertible of note
held by the Selling Stockholder as interest earned; and (iv) 390
shares of Common Stock expected to be issuable upon the upcoming
exercise of the warrants held by the Selling Stockholder as
interest earned.
(9)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 15,432 shares of Common Stock issuable upon the upcoming
conversion of a convertible note held by the Selling Stockholder,
which will convert on January 15, 2020; (ii) 7,716 shares of Common
Stock issued upon the exercise of warrants held by the Selling
Stockholder; (iii) 779 shares of Common Stock expected to be
issuable upon the upcoming conversion of the convertible of note
held by the Selling Stockholder as interest earned; and (iv) 390
shares of Common Stock expected to be issuable upon the upcoming
exercise of the warrants held by the Selling Stockholder as
interest earned.
(10)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 15,432 shares of Common Stock issuable upon the upcoming
conversion of a convertible note held by the Selling Stockholder,
which will convert on January 15, 2020; (ii) 7,716 shares of Common
Stock issued upon the exercise of warrants held by the Selling
Stockholder; (iii) 779 shares of Common Stock expected to be
issuable upon the upcoming conversion of the convertible of note
held by the Selling Stockholder as interest earned; and (iv) 390
shares of Common Stock expected to be issuable upon the upcoming
exercise of the warrants held by the Selling Stockholder as
interest earned.
(11)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 15,432 shares of Common Stock issuable upon the upcoming
conversion of a convertible note held by the Selling Stockholder,
which will convert on January 15, 2020; (ii) 7,716 shares of Common
Stock issued upon the exercise of warrants held by the Selling
Stockholder; (iii) 779 shares of Common Stock expected to be
issuable upon the upcoming conversion of the convertible of note
held by the Selling Stockholder as interest earned; and (iv) 390
shares of Common Stock expected to be issuable upon the upcoming
exercise of the warrants held by the Selling Stockholder as
interest earned.
(12)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 18,090 shares of Common Stock held by the Selling Stockholder;
and (ii) 9,045 shares of Common Stock issuable upon the exercise of
warrants held by the Selling Stockholder.
(13)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 18,519 shares of Common Stock issuable upon the upcoming
conversion of a convertible note held by the Selling Stockholder,
which will convert on January 21, 2020; (ii) 9,260 shares of Common
Stock issuable upon the exercise of warrants held by the Selling
Stockholder; (iii) 935 shares of Common Stock expected to be
issuable upon the upcoming conversion of the convertible of note
held by the Selling Stockholder as interest earned; and (iv) 468
shares of Common Stock expected to be issuable upon the upcoming
exercise of the warrants held by the Selling Stockholder as
interest earned.
(14)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 30,150 shares of Common Stock held by the Selling Stockholder;
and (ii) 15,075 shares of Common Stock issuable upon the exercise
of warrants held by the Selling Stockholder.
(15)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 15,432 shares of Common Stock held by the Selling Stockholder;
(ii) 30,864 shares of Common Stock issuable upon the upcoming
conversion of a convertible note held by the Selling Stockholder,
which will convert on January 21, 2020; and (iii) 1,559 shares of
Common Stock expected to be issuable upon the upcoming conversion
of the convertible of note held by the Selling Stockholder as
interest earned.
(16)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 30,864 shares of Common Stock issuable upon the upcoming
conversion of a convertible note held by the Selling Stockholder,
which will convert on January 15, 2020; (ii) 15,432 shares of
Common Stock issued upon the exercise of warrants held by the
Selling Stockholder; (iii) 1,559 shares of Common Stock expected to
be issuable upon the upcoming conversion of the convertible of note
held by the Selling Stockholder as interest earned; and (iv) 780
shares of Common Stock expected to be issuable upon the upcoming
exercise of the warrants held by the Selling Stockholder as
interest earned.
(17)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 92,593 shares of Common Stock issuable upon the upcoming
conversion of a convertible note held by the Selling Stockholder,
which will convert on January 15, 2020; (ii) 46,297 shares of
Common Stock issuable upon the exercise of warrants held by the
Selling Stockholder; (iii) 4,677 shares of Common Stock expected to
be issuable upon the upcoming conversion of the convertible of note
held by the Selling Stockholder as interest earned; and (iv) 2,339
shares of Common Stock expected to be issuable upon the upcoming
exercise of the warrants held by the Selling Stockholder as
interest earned.
(18)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 102,509 shares of Common Stock held by the Selling Stockholder;
and (ii) 51,255 shares of Common Stock issuable upon the exercise
of warrants held by the Selling Stockholder.
(19)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 120,599 shares of Common Stock held by the Selling Stockholder;
and (ii) 60,300 shares of Common Stock issuable upon the exercise
of warrants held by the Selling Stockholder.
(20)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 65,000 shares of Common Stock held by the Selling Stockholder;
and (ii) 250,000 shares of Common Stock issuable upon the exercise
of warrants held by the Selling Stockholder.
(21)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 85,000 shares of Common Stock held by the Selling Stockholder;
and (ii) 250,000 shares of Common Stock issuable upon the exercise
of warrants held by the Selling Stockholder.
(22)
The
number of shares offered by the Selling Stockholder is comprised of
(i) 370,370 shares of Common Stock issuable upon the upcoming
conversion of a convertible note held by the Selling Stockholder,
which will convert on January 15, 2020; (ii) 185,185 shares of
Common Stock issued upon the exercise of warrants held by the
Selling Stockholder; (iii) 18,706 shares of Common Stock expected
to be issuable upon the upcoming conversion of the convertible of
note held by the Selling Stockholder as interest earned; and (iv)
9,353 shares of Common Stock expected to be issuable upon the
upcoming exercise of the warrants held by the Selling Stockholder
as interest earned.
PLAN OF DISTRIBUTION
The Selling
Stockholders may, from time to
time, sell any or all of their shares of Common Stock registered
pursuant to this registration statement on any stock exchange,
market or trading facility on which the shares are traded or in
private transactions, in any of the following ways: (1) to or
through underwriters or dealers, (2) directly to purchasers,
including our affiliates, (3) through agents, or (4) through a
combination of any of these methods. The shares of Common Stock
registered herein may be distributed at a fixed price or prices,
which may be changed, market prices prevailing at the time of sale,
prices related to the prevailing market prices, or negotiated
prices. These sales may be at fixed or negotiated
prices.
The
Selling Stockholders may use any one or more of the following
methods when selling shares:
●
underwritten
transactions;
●
privately
negotiated transactions;
●
sales through the
NASDAQ Global Market or on any national securities exchange or
quotation service on which the shares of Common Stock may be listed or quoted at the
time of sale;
●
sales in the
over-the-counter market;
●
ordinary brokerage
transactions and transactions in which the broker solicits
purchasers;
●
broker-dealers may
agree with the Selling Stockholders to sell a specified number of
such shares of Common Stock at
a stipulated price per share;
●
a block trade
(which may involve crosses) in which the broker-dealer so engaged
will attempt to sell the Common
Stock as agent but may position and resell a portion of the
block as principal to facilitate the transaction;
●
purchases by a
broker-dealer as principal and resale by such broker-dealer for its
own account pursuant to this prospectus;
●
“at the
market” offerings to or through a market maker or into an
existing trading market, on an exchange or otherwise;
●
exchange
distributions and/or secondary distributions;
●
short sales and
delivery of shares of Common
Stock to close out short positions;
●
sales by
broker-dealers of shares of Common
Stock that are loaned or pledged to such
broker-dealers;
●
a combination of
any such methods of sale; and
●
any other method
permitted pursuant to applicable law.
A
Selling Stockholder that is an entity may elect to make a pro rata
in-kind distribution of shares of our Common Stock registered
herein to its members, partners or stockholders pursuant to the
registration statement of which this prospectus forms a part by
delivering a prospectus. To the extent that such members, partners
or stockholders are not affiliates of such selling stockholder,
such members, partners or stockholders would thereby receive freely
tradeable shares of our Common Stock pursuant to the distribution
through a registration statement.
The
Selling Stockholders may also sell shares under Rule 144 under the
Securities Act, if available, rather than under this
prospectus.
Broker-dealers
engaged by the Selling Stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive
commissions or discounts from the Selling Stockholders (or, if any
broker-dealer acts as agent for the purchaser of shares, from the
purchaser) in amounts to be negotiated. The Selling Stockholders do
not expect these commissions and discounts to exceed what is
customary in the types of transactions involved. Any profits on the
resale of shares of Common Stock registered herein by a
broker-dealer acting as principal might be deemed to be
underwriting discounts or commissions under the Securities Act.
Discounts, concessions, commissions and similar selling expenses,
if any, attributable to the sale of shares will be borne by a
Selling Stockholder. The Selling Stockholders may agree to
indemnify any agent, dealer or broker-dealer that participates in
transactions involving sales of the shares if liabilities are
imposed on that person under the Securities Act.
The
Selling Stockholders may from time to time pledge or grant a
security interest in some or all of the shares of Common Stock
owned by them and, if they default in the performance of their
secured obligations, the pledgees or secured parties may offer and
sell the shares of Common Stock registered herein from time to time
under this prospectus after we have filed a supplement to this
prospectus under Rule 424(b)(3) or other applicable provision of
the Securities Act supplementing or amending the list of Selling
Stockholders to include the pledgee, transferee or other successors
in interest as Selling Stockholders under this
prospectus.
The
Selling Stockholders also may transfer the shares of Common Stock
registered herein in other circumstances, in which case the
transferees, pledgees or other successors in interest will be the
selling beneficial owners for purposes of this prospectus and may
sell the shares of Common Stock registered herein from time to time
under this prospectus after we have filed a supplement to this
prospectus under Rule 424(b)(3) or other applicable provision of
the Securities Act supplementing or amending the list of Selling
Stockholders to include the pledgee, transferee or other successors
in interest as Selling Stockholders under this
prospectus.
The
Selling Stockholders and any broker-dealers or agents that are
involved in selling the shares of Common Stock registered herein
may be deemed to be “underwriters” within the meaning
of the Securities Act in connection with such sales. In such event,
any commissions received by such broker-dealers or agents and any
profit on the resale of the shares of Common Stock purchased by
them may be deemed to be underwriting commissions or discounts
under the Securities Act.
We
are required to pay all fees and expenses incident to the
registration of the shares of Common Stock registered herein. We
have agreed to indemnify the Selling Stockholders against certain
losses, claims, damages and liabilities, including liabilities
under the Securities Act.
The
Selling Stockholders have advised us that they have not entered
into any agreements, understandings or arrangements with any
underwriters or broker-dealers regarding the sale of their shares
of Common Stock registered herein, nor is there an underwriter or
coordinating broker acting in connection with a proposed sale of
shares of Common Stock registered herein by any Selling
Stockholder. If we are notified by any Selling Stockholder that any
material arrangement has been entered into with a broker-dealer for
the sale of shares of Common Stock registered herein, if required,
we will file a supplement to this prospectus. If the Selling
Stockholders use this prospectus for any sale of the shares of
Common Stock registered herein, they will be subject to the
prospectus delivery requirements of the Securities
Act.
The
anti-manipulation rules of Regulation M under the Securities
Exchange Act of 1934 may apply to sales of our Common Stock
registered herein and activities of the Selling
Stockholders.
LEGAL MATTERS
The
validity of the shares of Common Stock offered hereby will be
passed upon by Ballard Spahr LLP, Las Vegas, Nevada. Additional
legal matters may be passed on for any underwriters, dealers or
agents by counsel we will name in any applicable prospectus
supplement.
EXPERTS
The
consolidated financial statements as of February 28, 2019 and 2018
and for the years then ended and management’s assessment of
the effectiveness of internal control over financial reporting
(which is included in Management’s Report on Internal Control
over Financial Reporting) as of February 28, 2019 incorporated in
this Prospectus by reference to the Annual Report on Form 10-K for
the year ended February 28, 2019 have been so incorporated in
reliance on the report (which contains an explanatory paragraph
relating to the company’s ability to continue as a going
concern as described in Note 1 to the consolidated financial
statements) of PricewaterhouseCoopers LLP, an independent
registered public accounting firm, given on the authority of said
firm as experts in auditing and accounting.
The
consolidated financial statements for the year ended February 28,
2017 incorporated by reference to the Annual Report on Form 10-K
for the year ended February 28, 2019 have been so incorporated in
reliance on the report of Weinberg & Company, P.A., an
independent registered public accounting firm, given on the
authority of said firm as experts in auditing and
accounting.
WHERE YOU CAN FIND MORE INFORMATION
We
file annual, quarterly and other reports, proxy statements and
other information with the SEC. Our SEC filings are available to
the public over the Internet at the SEC’s website at
http://www.sec.gov. You may also read and copy any document we file
at the SEC’s Public Reference Room at 100 F Street, NE,
Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for
further information on the Public Reference Room. Our Annual Report
on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports
on Form 8-K, including any amendments to those reports, and other
information that we file with or furnish to the SEC pursuant to
Section 13(a) or 15(d) of the Exchange Act can also be
accessed free of charge through the Internet. These filings will be
available as soon as reasonably practicable after we electronically
file such material with, or furnish it to, the SEC.
We
have filed with the SEC a registration statement under the
Securities Act of, relating to the offering of these shares of
Common Stock. The registration statement, including the attached
exhibits, contains additional relevant information about us and the
shares of Common Stock. This prospectus does not contain all of the
information set forth in the registration statement. You can obtain
a copy of the registration statement, at prescribed rates, from the
SEC at the address listed above. The registration statement and the
documents referred to below under “Information Incorporated
by Reference” are also available on our investor relations
web site (http://www.loopindustries.com/en/investors/home). We have
not incorporated by reference into this prospectus the information
on our website, and you should not consider it to be a part of this
prospectus.
INFORMATION INCORPORATED BY REFERENCE
We
“incorporate by reference” certain documents we file
with the SEC, which means that we are disclosing important
information to you by referring you to those documents. The
information incorporated by reference is an important part of this
prospectus, and any information contained in this prospectus or in
any document incorporated by reference in this prospectus will be
deemed to be modified or superseded to the extent that a statement
contained in this prospectus or free writing prospectus provided to
you in connection with this offering, or in any other document we
subsequently file with the SEC that also is incorporated by
reference in this prospectus, modifies or supersedes the original
statement. Any statement so modified or superseded will not be
deemed, except as so modified or superseded, to be a part of this
prospectus.
The
following documents filed with the SEC are hereby incorporated by
reference in this prospectus:
●
our
Definitive Proxy Statement, filed with the SEC on May 10, 2019,
relating to our 2019 Annual Meeting of Stockholders held on June
27, 2019, to the extent incorporated by reference into such Annual
Report on Form 10-K;
●
our Quarterly
Reports on Form 10-Q for the quarters ended
May 31, 2019 and
August 31, 2019, filed with the SEC on July 8, 2019 and October
8, 2019, respectively;
●
all other reports
filed by us pursuant to Section 13(a) or 15(d) of the Exchange Act,
since February 28, 2019 (except to the extent information
contained in Current Reports on Form 8-K therein that is furnished
and not filed);
●
the description of
our Common Stock as set forth
in our
registration statement on Form 8-A (Commission File No.
001-38301), filed with the SEC on November 17, 2017, including any
subsequent amendment or any report filed for the purpose of
updating such description.
All
reports and other documents subsequently filed by us pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act after
the date of this prospectus and prior to the termination of this
offering shall be deemed to be incorporated by reference in this
prospectus and to be part hereof from the date of filing of such
reports and other documents.
Notwithstanding
the statements in the preceding paragraphs, no document, report or
exhibit (or portion of any of the foregoing) or any other
information that we have “furnished” or may in the
future “furnish” to the SEC pursuant to the Exchange
Act shall be incorporated by reference into this
prospectus.
We
hereby undertake to provide without charge to each person,
including any beneficial owner, to whom a copy of this prospectus
is delivered, upon written or oral request of any such person, a
copy of any and all of the information that has been or may be
incorporated by reference in this prospectus, other than exhibits
to such documents, unless such exhibits have been specifically
incorporated by reference thereto. Requests for such copies should
be directed to our Investor Relations department, at the following
address: Loop Industries, Inc., 480 Fernand-Poitras, Terrebonne,
Québec, Canada, J6Y 1Y4 91367, Attention: General Counsel, or
you may call us at (450) 951-8555.
2,081,451 Shares of Common Stock
Offered by the Selling Stockholders
PROSPECTUS