What changed in this filing

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Item 1. Financial Statements

2025-01-14 compared with 2024-10-15 · 169 added, 165 removed, 334 unchanged (50% of the section changed)

1 unchanged sentence

Loop Industries, Inc.

Three and Six months ended August 31, 2024

Three and Nine months ended November 30, 2024

Index to the Unaudited Interim Condensed Consolidated Financial Statements

Condensed consolidated balance sheets as at August 31, 2024 (Unaudited) and February 29, 2024

Condensed consolidated statements of operations and comprehensive loss for the three and six months ended August 31, 2024 and 2023 (Unaudited)

Condensed consolidated statements of changes in stockholders’ equity for the three and six months ended August 31, 2024 and 2023 (Unaudited)

Condensed consolidated statements of cash flows for the six months ended August 31, 2024 and 2023 (Unaudited)

Condensed consolidated balance sheets as at November 30, 2024 (Unaudited) and February 29, 2024

Condensed consolidated statements of operations and comprehensive loss for the three and nine months ended November 30, 2024 and 2023 (Unaudited)

Condensed consolidated statements of changes in stockholders’ equity for the three and nine months ended November 30, 2024 and 2023 (Unaudited)

Condensed consolidated statements of cash flows for the nine months ended November 30, 2024 and 2023 (Unaudited)

Notes to the condensed consolidated financial statements (Unaudited)

7 unchanged sentences

Inventories (Note 4)

Prepaid expenses and other deposits (Note 5)

Prepaid expenses (Note 5)

Total current assets

5 unchanged sentences

Accounts payable and accrued liabilities (Note 9)

Current portion of long-term debt (Note 10)

Credit facility (Note 10)

Unearned revenue (Note 11)

Current portion of long-term debt (Note 12)

Total current liabilities

15 unchanged sentences

Total liabilities and stockholders’ equity

Going Concern (Note 1)

See accompanying notes to the condensed consolidated financial statements .

4 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

November 30, 2024

November 30, 2023

November 30, 2024

November 30, 2023

Revenue from contracts with customers

1 unchanged sentence

General and administrative (Note 15)

Impairment of machinery & equipment (Note 6)

Depreciation and amortization (Notes 6 and 7)

12 unchanged sentences

Basic and diluted

Going Concern (Note 1)

See accompanying notes to the condensed consolidated financial statements.

3 unchanged sentences

dollars, except for share data)

Three months ended August 31, 2024

par value $0.0001

Three months ended November 30, 2024

Preferred stock

par value $0.0001

Accumulated Other

Number of Shares

par value $0.0001

Number of Shares

Accumulated Deficit

Comprehensive Income (Loss)

Comprehensive

Income (Loss)

Stockholders’

Balance, May 31, 2024

Balance, August 31, 2024

$ ( 186,998 )

Issuance of shares upon the vesting of restricted stock units (Note 15)

Expiration of warrants (Note 17)

Stock options issued for services (Note 16)

1 unchanged sentence

Foreign currency translation

Balance, August 31, 2024

Balance, November 30, 2024

$ ( 198,910 )

Going Concern (Note 1)

(in thousands of U.S.

dollars, except for share data)

Three months ended August 31, 2023

par value $0.0001

Three months ended November 30, 2023

Preferred stock

par value $0.0001

Accumulated Other

par value $0.0001

Number of Shares

Capital – Warrants

Accumulated Deficit

Comprehensive Income (Loss)

Stockholders’ Equity

Balance, May 31, 2023

Comprehensive

Income (Loss)

Stockholders’

Balance, August 31, 2023

$ ( 167,634 )

Issuance of shares upon the exercise of stock options (Note 16)

Stock options issued for services (Note 16)

1 unchanged sentence

Foreign currency translation

Balance, August 31, 2023

Balance, November 30, 2023

$ ( 171,878 )

Going Concern (Note 1)

See accompanying notes to the condensed consolidated financial statements.

3 unchanged sentences

dollars, except for share data)

Six months ended August 31, 2024

par value $0.0001

Nine months ended November 30, 2024

Preferred stock

par value $0.0001

Accumulated Other

par value $0.0001

Number of Shares

Accumulated Deficit

Comprehensive Income (Loss)

Stockholders’ Equity

Capital – Warrants

Comprehensive

Income (Loss)

Stockholders’

Balance, February 29, 2024

5 unchanged sentences

Foreign currency translation

Balance, August 31, 2024

Balance, November 30, 2024

$ ( 198,910 )

Going Concern (Note 1)

Six Months Ended August 31, 2023

par value $0.0001

Nine Months Ended November 30, 2023

Series A preferred stock

par value $0.0001

Accumulated Other

par value $0.0001

Number of Shares

1 unchanged sentence

Capital - Warrants

Accumulated Deficit

Comprehensive (Loss)

Stockholders' Equity

Comprehensive

Stockholders’

Balance, February 28, 2023

1 unchanged sentence

Issuance of shares upon the vesting of restricted stock units (Note 16)

Issuance of shares upon the exercise of stock options (Note 16)

Stock options issued for services (Note 16)

1 unchanged sentence

Foreign currency translation

Balance, August 31, 2023

Balance, November 30, 2023

$ ( 171,878 )

Going Concern (Note 1)

See accompanying notes to the condensed consolidated financial statements.

2 unchanged sentences

(in thousands of U.S.

Six Months Ended August 31,

Nine Months Ended November 30,

Cash Flows from Operating Activities

2 unchanged sentences

Stock-based compensation expense (Note 16)

Impairment of machinery & equipment (Note 6)

Accretion expense (Note 12)

8 unchanged sentences

Cash Flows from Investing Activities

Deposits on equipment (Note 5)

Deposits on equipment

Distribution from equity investment

Additions to property, plant and equipment (Note 6)

Additions to intangible assets (Note 7)

12 unchanged sentences

Interest received

Going Concern (Note 1)

See accompanying notes to the condensed consolidated financial statements.

Loop Industries, Inc.

Three and Six Months Ended August 31, 2024 and 2023

Three and Nine Months Ended November 30, 2024 and 2023

Notes to the Condensed Consolidated Financial Statements

The Company, Basis of Presentation and Going Concern

The Company and Basis of Presentation

Loop Industries, Inc.

14 unchanged sentences

In the opinion of management, the accompanying unaudited interim condensed consolidated financial statements present fairly the financial position, results of operations, comprehensive loss and cash flows for the interim periods.

The results for the three- and six-month periods ended August 31, 2024 are not necessarily indicative of the results to be expected for any subsequent quarter, for the fiscal year ending February 28, 2025, or for any other period.

The results for the three- and nine-month periods ended November 30, 2024 are not necessarily indicative of the results to be expected for any subsequent quarter, for the fiscal year ending February 28, 2025, or for any other period.

All monetary amounts in these notes to the condensed consolidated financial statements are in thousands of U.S.

dollars unless otherwise specified, except for per share data.

Going Concern

These unaudited interim condensed consolidated financial statements have been prepared using accounting principles generally accepted in the United States of America applicable to a going concern, which contemplate the realization of assets and settlement of liabilities in the normal course of business as they come due.

In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future, which is at least, but not limited to, twelve months from the date of issuance of these consolidated financial statements.

Since its inception, the Company has been in the pre-commercialization stage with no material revenues from customers, and its ongoing operations and commercialization plans have been financed primarily by raising equity and debt.

Therefore, the Company has incurred net losses and negative cash flow from operating and investing activities since its inception and expects to incur additional net losses while it continues to develop and plan for commercialization.

As at August 31, 2024, the Company’s available liquidity was $ 2,403 , consisting of cash and cash equivalents of $ 1,395 and an undrawn amount on a senior loan facility from a Canadian bank of $ 1,008 .

Also, current liabilities exceeded current assets by $ 2,510 as at August 31, 2024.

Summary of Significant Accounting Policies

Liquidity risk assessment

The Company has incurred net losses and negative cash flow from operating and investing activities since its inception and expects to incur additional net losses while it continues to develop and plan for commercialization.

As at November 30, 2024, the Company’s available liquidity was $ 450 , consisting of cash and cash equivalents of $ 323 and an undrawn amount on a senior credit facility from a Canadian bank of $ 127 .

Also, current liabilities exceeded current assets by $ 7,085 as at November 30, 2024.

On December 23, 2024, the Company received cash proceeds of $ 20,790 from the closing of transactions with Reed Management SAS (“Reed”), consisting of the issuance of Series B Convertible Preferred Stock and its first technology licensing agreement (see Note 20 for additional details).

Management continuously monitors the Company’s cash resources against its short-term cash commitments to ensure there is sufficient liquidity to fund its costs for at least twelve months from the financial statement issuance date.

Management evaluates the Company’s liquidity to determine if there is substantial doubt about its ability to continue as a going concern.

It evaluates the Company’s liquidity to determine if there is substantial doubt about its ability to continue as a going concern.

In preparing this going concern assessment, management applies significant judgment in estimating future cash flow requirements of the Company based on budgets and forecasts, which includes developing assumptions related to the estimation of amount and timing of future cash outflows and inflows.

Based on this assessment, it is estimated that the Company has sufficient liquidity to cover expected cash outflows until end of November 2024, by which time management believes the financing with Reed (see Note 18 for additional details) will be completed, and that the remaining closing conditions will have been addressed.

This is expected to provide an initial amount of $11,080 (€10,000), with further amounts at future dates.

To secure the Company’s liquidity in the event of timing delays in funding, certain insiders have committed to provide bridge financing of $2,000 if necessary.

Notwithstanding, these events and conditions are material uncertainties that raise substantial doubt upon the Company’s ability to continue as a going concern and accordingly, the appropriateness of the use of accounting principles applicable to a going concern.

The Company’s ability to move to the next stage of its strategic development and construct manufacturing plants is dependent on, among other factors, whether the Company can obtain the necessary financing through a combination of the issuance of debt, equity, and/or joint ventures, and/or government incentive programs and/or customers.

Based on this assessment and considering the $20,790 proceeds received on December 23, 2024, management is comfortable that current available liquidity will be sufficient to meet the Company’s obligations, commitments and budgeted expenditures for no less than twelve months from the issuance date of these unaudited interim condensed consolidated financial statements.

The Company’s ability to move to the next stage of its strategic development and construct manufacturing plants is dependent on, among other factors, whether the Company can obtain the necessary financing through a combination of further technology licensing arrangements, government incentive programs, and/or the issuance of debt and/or equity.

However, there is no assurance that the Company will be successful in attracting additional funding.

1 unchanged sentence

Failure to secure additional financing on favorable terms when it becomes required would have an adverse effect on the Company’s financial position and on its ability to execute its business plan.

The Company is seeking to finalize the negotiation of previously announced financing initiatives on acceptable terms (see Note 18 for additional details), however, there is no assurance it will succeed.

These unaudited interim condensed consolidated financial statements do not reflect the adjustments to the carrying values of assets and liabilities and the reported expenses and balance sheet classifications that would be necessary if the Company were unable to realize its assets and settle its liabilities as a going concern in the normal course of operations.

Such adjustments could be material.

Summary of Significant Accounting Policies

Use of estimates

1 unchanged sentence

Actual results could differ from those estimates.

Those estimates and assumptions include the going concern assessment, estimates for depreciable lives of property, plant and equipment and intangible assets, recoverability of tax credits receivable, assumptions made in calculating the fair value of stock-based compensation and other equity instruments, and the assessment of performance conditions for stock-based compensation awards.

Those estimates and assumptions include the going concern assessment, estimates for depreciable lives of property, plant and equipment and intangible assets, recoverability of property, plant and equipment, recoverability of tax credits receivable, assumptions made in calculating the fair value of stock-based compensation and other equity instruments, and the assessment of performance conditions for stock-based compensation awards.

Unearned revenue

10 unchanged sentences

Potential common shares are excluded from the computation if their effect is antidilutive.

For the three- and six-month periods ended August 31, 2024 and 2023, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have an antidilutive effect.

As at August 31, 2024, the potentially dilutive securities consisted of 2,771,216 outstanding stock options (2023 – 2,782,000 ), 4,461,818 outstanding restricted stock units (2023 – 4,417,688 ), and 2,357,407 outstanding warrants (2023 – 7,089,400 ).

For the three- and nine-month periods ended November 30, 2024 and 2023, the calculations of basic and diluted loss per share are the same because potential dilutive securities would have an antidilutive effect.

As at November 30, 2024, the potentially dilutive securities consisted of 2,771,216 outstanding stock options (2023 – 2,772,000 ), 4,448,179 outstanding restricted stock units (2023 – 4,417,688 ), and 2,357,407 outstanding warrants (2023 – 7,089,400 ).

Recently issued accounting pronouncements not yet adopted

2 unchanged sentences

The amendments in this Update address investor requests for more transparency about income tax information through improvements to income tax disclosures primarily related to the rate reconciliation and income taxes paid information and includes certain other amendments to improve the effectiveness of income tax disclosures.

The updated standard is effective for our annual periods beginning after December 15, 2024.

The updated standard is effective for our annual period beginning after December 15, 2024, which for the Company will be the annual period ending February 28, 2026.

Early adoption is permitted.

Management is currently evaluating the impact that the updated standard will have on our financial statement disclosures.

The Company does not expect that the adoption of this guidance will have a material impact on its consolidated financial statements, other than additional disclosures in our notes to the consolidated financial statements.

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2023-07, Segment Reporting, which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses.

The updated standard is effective for our annual periods beginning in fiscal 2025 and interim periods beginning in the first quarter of fiscal 2026.

Early adoption is permitted.

The updated standard is effective for our annual period ending February 28, 2025.

Management is currently evaluating the impact that the updated standard will have on our financial statement disclosures.

In August 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2023-05, Joint Venture Formations, which requires joint ventures to apply a new basis of accounting by measuring assets and liabilities at fair value upon formation.

The amendments address diversity in practice by establishing requirements for recognition and measurement of net assets and liabilities on the formation date.

The updated standard is effective for fiscal years beginning after December 15, 2024, including interim periods within those fiscal years.

Early adoption is permitted.

Management is currently evaluating the impact that the updated standard will have on our consolidated financial statements and related disclosures.

Sales Tax, Tax Credits and Other Receivables

Sales tax, research and development tax credits and other receivables as at August 31, 2024 and February 29, 2024 were as follows:

August 31, 2024

Sales tax, research and development tax credits and other receivables as at November 30, 2024 and February 29, 2024 were as follows:

November 30, 2024

February 29, 2024

2 unchanged sentences

Other receivables

Inventories as at August 31, 2024 and February 29, 2024 were as follows:

August 31, 2024

Inventories as at November 30, 2024 and February 29, 2024 were as follows:

November 30, 2024

February 29, 2024

3 unchanged sentences

Allowance for inventory write-down

As at August 31, 2024 and February 29, 2024, inventories included finished goods, work in process and raw materials.

As at November 30, 2024 and February 29, 2024, inventories included finished goods, work in process and raw materials.

Finished goods inventories consist of bottle grade and fiber grade Loop ™ PET resin.

2 unchanged sentences

Raw materials inventories consist of chemicals which are used as inputs in the PET depolymerization process.

As at August 31, 2024 and February 29, 2024, finished goods and work in process inventories were presented at their net realizable value, while raw materials were presented at average cost.

As at August 31, 2024, the Company recorded an allowance for inventory write-down of $ 802 (February 29, 2024 – $ 817 ) on finished goods and work in process inventories related to inventory volumes not expected to be sold in the next twelve months.

Prepaid Expenses and Other Deposits

Prepaid expenses and other deposits as at August 31, 2024 and February 29, 2024 were as follows:

August 31, 2024

As at November 30, 2024 and February 29, 2024, finished goods and work in process inventories were presented at their net realizable value, while raw materials were presented at average cost.

As at November 30, 2024, the Company recorded an allowance for inventory write-down of $ 762 (February 29, 2024 – $ 817 ) on finished goods and work in process inventories related to inventory volumes not expected to be sold in the next twelve months.

Prepaid Expenses

Prepaid expenses as at November 30, 2024 and February 29, 2024 were as follows:

November 30, 2024

February 29, 2024

As of August 31, 2023, the Company had placed non-refundable cash deposits totaling $ 5,065 on long-lead equipment intended for use in the initial Infinite Loop™ manufacturing facility.

By February 29, 2024, this equipment had been received, and the corresponding amount was transferred to Machinery & Equipment on our balance sheet.

Property, Plant and Equipment, Net

As at August 31, 2024

As at November 30, 2024

Accumulated depreciation, write-down and impairment

3 unchanged sentences

Office equipment and furniture

The equipment, which is being held in storage, and can be utilized in a commercial facility, is presented in machinery and equipment at cost and is currently not being amortized.

As at August 31, 2024 there were no indicators of impairment of the equipment.

As at February 29, 2024

4 unchanged sentences

Office equipment and furniture

Depreciation expense for the three- and six-month periods ended August 31, 2024 amounted to $ 79 and $ 170 , respectively (2023 – $ 101 and $ 201 ).

Depreciation expense for the three- and nine-month periods ended November 30, 2024 amounted to $ 79 and $ 249 , respectively (2023 – $ 93 and $ 295 ).

During the three-month period ended November 30, 2024 the Company recorded an impairment charge for machinery and equipment of $ 8,460 .

This impairment was due to the termination of the joint venture arrangement between the Company and SK Geo Centric Co.

(“SKGC”) under which they had intended to construct and operate an Infinite Loop™ manufacturing facility in Ulsan, South Korea (see note 20 for additional details).

The Company plans to utilize the equipment in a future commercial production facility.

However, the deployment plans for the use of this equipment are not fully developed at this time and therefore the carrying value of the equipment was considered to be impaired, resulting in an expense of $8,460 being recognized in the three-month period ended November 30, 2024.

Intangible Assets, Net

Intangible assets as at August 31, 2024 and February 29, 2024 were $ 1,786 and $ 1,548 , respectively.

During the six-month periods ended August 31, 2024 and 2023, we made additions relating to patent application costs to intangible assets of $ 325 and $ 225 , respectively.

Amortization expense for the three- and six-month periods ended August 31, 2024 amounted to $ 50 and $ 96 , respectively (2023 – $ 35 and $ 67 ).

Intangible assets as at November 30, 2024 and February 29, 2024 were $ 1,808 and $ 1,548 , respectively.

During the nine-month periods ended November 30, 2024 and 2023, we made additions relating to patent application costs to intangible assets of $ 454 and $ 378 , respectively.

Amortization expense for the three- and nine-month periods ended November 30, 2024 amounted to $ 53 and $ 149 , respectively (2023 – $ 38 and $ 105 ).

Fair Value of Financial Instruments

The following tables presents the fair value of the Company’s financial liabilities as at August 31, 2024 and February 29, 2024:

Fair Value at August 31, 2024

The following tables presents the fair value of the Company’s financial liabilities as at November 30, 2024 and February 29, 2024:

Fair Value at November 30, 2024

Carrying Amount

9 unchanged sentences

Due to customer

The fair value of cash, restricted cash, due to customer, other receivables, and accounts payable and accrued liabilities approximate their carrying values due to their short-term maturity.

The fair value of cash, restricted cash, due to customer, credit facility, other receivables, and accounts payable and accrued liabilities approximate their carrying values due to their short-term maturity.

Accounts Payable and Accrued Liabilities

Accounts payable and accrued liabilities as at August 31, 2024 and February 29, 2024 were as follows:

August 31, 2024

Accounts payable and accrued liabilities as at November 30, 2024 and February 29, 2024 were as follows:

November 30, 2024

February 29, 2024

4 unchanged sentences

Other accrued liabilities

Credit Facility

On July 26, 2022, Loop Canada, Inc., a wholly-owned subsidiary of the Company, entered into an Operating Credit Facility (the “Credit Facility”) with a Canadian bank.

The Credit Facility allows for borrowings of up to $ 2,498 (CDN $3,500) in aggregate principal amount and provides for a two-year term on amounts drawn.

All borrowings under the Credit Facility bear interest at an annual rate equal to the bank’s Canadian prime rate plus 1.0 %.

The Credit Facility is collateralized by the Company’s Terrebonne, Québec property and is subject to a minimum equity covenant, tested quarterly, with which the Company was not in compliance as at November 30, 2024.

On December 12, 2024, the Company received a waiver from the bank, confirming they have no intention of demanding payment, provided that the Company receives capital injections for at least CDN $10,000 by December 31, 2024 and CDN $10,000 by January 31, 2025 .

The Company received $20,790 from Reed on December 23, 2024 which meets the requirements set forth in the waiver (see Note 20 for additional details).

As at November 30, 2024, the Company borrowed $ 2,372 under the Credit Facility.

The Company recorded interest expense on the Credit Facility for the three- and nine-month periods ended November 30, 2024 in the amount of $ 41 and $ 86 , respectively (2023 – nil and nil).

Unearned revenue

As at November 30, 2024, unearned revenue was $ 102 (2023 – nil), comprised of a payment received from a customer while the Company has not yet fulfilled its obligation to deliver rPET.

Long‑Term Debt

Long-term debt as of August 31, 2024 and February 29, 2024, was comprised of the following:

August 31, 2024

Long-term debt as of November 30, 2024 and February 29, 2024, was comprised of the following:

November 30, 2024

February 29, 2024

5 unchanged sentences

current portion of long-term debt

Credit facility

Long-term debt, net of current portion

Investissement Québec financing facility

The Company recorded interest expense on the Investissement Québec loan for the three- and six-month periods ended August 31, 2024 in the amount of $ 29 and $ 59 , respectively (2023 – $ 22 and $ 43 ) and an accretion expense of $ 14 and $ 27 , respectively (2023 – $ 18 and $ 36 ).

During the six-month period ended August 31, 2024, the Company made repayments of $ 50 (2023 – $ 32 ) on the Investissement Québec loan.

Credit facility from a Canadian bank

On July 26, 2022, Loop Canada, Inc., a wholly-owned subsidiary of the Company, entered into an Operating Credit Facility (the “Credit Facility”) with a Canadian bank.

The Credit Facility allows for borrowings of up to $ 2,594 (CDN $3,500) in aggregate principal amount and provides for a two-year term on amounts drawn.

The Credit Facility is collateralized by the Company’s Terrebonne, Québec property and is subject to a minimum equity covenant, tested quarterly with which the Company was in compliance as at August 31, 2024.

All borrowings under the Credit Facility bear interest at an annual rate equal to the bank’s Canadian prime rate plus 1.0 %.

As at August 31, 2024, the Company borrowed $ 1,587 under the Credit Facility.

The Company recorded interest expense on the Credit Facility for the three- and six-month periods ended August 31, 2024 in the amount of $ 61 and $ 62 , respectively (2023 – nil and nil)

The Company recorded interest expense on the Investissement Québec loan for the three- and nine-month periods ended November 30, 2024 in the amount of $ 29 and $ 87 , respectively (2023 – $ 21 and $ 63 ) and an accretion expense of $ 13 and $ 41 , respectively (2023 – $ 18 and $ 53 ).

During the nine-month period ended November 30, 2024, the Company made repayments of $ 60 (2023 – $ 47 ) on the Investissement Québec loan.

Total repayments due on the Company’s indebtedness over the next five years are as follows:

4 unchanged sentences

February 28, 2029

Unearned revenue

As at August 31, 2024, unearned revenue was $ 101 (2023 – nil), comprised of a payment received from a customer while the Company has not yet fulfilled its obligation to deliver rPET.

Stockholders’ Equity

For the period ended August 31, 2024

For the period ended November 30, 2024

Number of shares

1 unchanged sentence

Issuance of shares upon settlement of restricted stock units

Balance, August 31, 2024

For the period ended August 31, 2023

Balance, November 30, 2024

For the period ended November 30, 2023

Number of shares

1 unchanged sentence

Issuance of shares upon settlement of restricted stock units

Balance, August 31, 2023

During the six months ended August 31, 2024, the Company recorded the following common stock transaction:

Issuance of shares upon the exercise of stock options

Balance, November 30, 2023

During the nine months ended November 30, 2024, the Company recorded the following common stock transaction:

The Company issued 91,355 shares of the common stock to settle restricted stock units that vested in the period.

During the six months ended August 31, 2023, the Company recorded the following common stock transaction:

During the nine months ended November 30, 2023, the Company recorded the following common stock transaction:

The Company issued 51,963 shares of the common stock to settle restricted stock units that vested in the period.

The Company issued 7,721 shares of the common stock to settle stock options exercised in the period.

Research and Development Expenses

Research and development expenses for the three-month periods ended August 31, 2024 and 2023 were as follows:

August 31, 2024

August 31, 2023

Research and development expenses for the three-month periods ended November 30, 2024 and 2023 were as follows:

November 30, 2024

November 30, 2023

Employee compensation

Machinery and equipment expenditures

External engineering

Plant and laboratory operating expenses

Research and development expenses for the six-month periods ended August 31, 2024 and 2023 were as follows:

August 31, 2024

August 31, 2023

Patent legal fees

Research and development expenses for the nine-month periods ended November 30, 2024 and 2023 were as follows:

November 30, 2024

November 30, 2023

Employee compensation

2 unchanged sentences

Plant and laboratory operating expenses

Patent legal fees

General and Administrative Expenses

General and administrative expenses for the three-month periods ended August 31, 2024 and 2023 were as follows:

August 31, 2024

August 31, 2023

General and administrative expenses for the three-month periods ended November 30, 2024 and 2023 were as follows:

November 30, 2024

November 30, 2023

Employee compensation

Professional fees

General and administrative expenses for the six-month periods ended August 31, 2024 and 2023 were as follows:

August 31, 2024

August 31, 2023

General and administrative expenses for the nine-month periods ended November 30, 2024 and 2023 were as follows:

November 30, 2024

November 30, 2023

Employee compensation

2 unchanged sentences

Stock Options

The following table summarizes the continuity of the Company’s stock options during the three-month periods ended August 31, 2024 and 2023:

The following table summarizes the continuity of the Company’s stock options during the three-month periods ended November 30, 2024 and 2023:

stock options

exercise price

Weighted average exercise price

stock options

3 unchanged sentences

Exercisable, end of period

The following tables summarizes the continuity of the Company’s stock options during the six-month periods ended August 31, 2024 and 2023:

The following tables summarizes the continuity of the Company’s stock options during the nine-month periods ended November 30, 2024 and 2023:

stock options

exercise price

Weighted average exercise price

stock options

5 unchanged sentences

Fair value is calculated based on a Black-Scholes option pricing model.

The principal components of the pricing model for the stock options granted in the six-month period ended August 31, 2024 and 2023 were as follows:

The principal components of the pricing model for the stock options granted in the nine-month period ended November 30, 2024 and 2023 were as follows:

Exercise price

3 unchanged sentences

Expected life

During the three-month periods ended August 31, 2024 and 2023, stock-based compensation expense attributable to stock options amounted to $ 148 and $ 172 , respectively.

During the six-month periods ended August 31, 2024 and 2023, stock-based compensation expense attributable to stock options amounted to $ 295 and $ 333 , respectively.

During the three-month periods ended November 30, 2024 and 2023, stock-based compensation expense attributable to stock options amounted to $ 146 and $ 168 , respectively.

During the nine-month periods ended November 30, 2024 and 2023, stock-based compensation expense attributable to stock options amounted to $ 441 and $ 501 , respectively.

Restricted Stock Units

The following table summarizes the continuity of the restricted stock units during the three-month periods ended August 31, 2024 and 2023:

The following table summarizes the continuity of the restricted stock units during the three-month periods ended November 30, 2024 and 2023:

Number of units

Weighted average fair value price

Number of units

Weighted average fair value price

Outstanding, beginning of period

1 unchanged sentence

Outstanding vested, end of period

The following table summarizes the continuity of the restricted stock units during the six-month periods ended August 31, 2024 and 2023:

The following table summarizes the continuity of the restricted stock units during the nine-month periods ended November 30, 2024 and 2023:

Number of units

Weighted average fair value price

Number of units

Weighted average fair value price

Outstanding, beginning of period

3 unchanged sentences

Fair value is calculated based on the intrinsic value at grant date multiplied by the number of restricted stock unit awards granted.

During the three-month periods ended August 31, 2024 and 2023, stock-based compensation attributable to RSUs amounted to $ 214 and $ 216 , respectively.

During the six-month periods ended August 31, 2024 and 2023, stock-based compensation attributable to RSUs amounted to $ 437 and $ 410 , respectively.

During the three-month periods ended November 30, 2024 and 2023, stock-based compensation attributable to RSUs amounted to $ 184 and $ 229 , respectively.

During the nine-month periods ended November 30, 2024 and 2023, stock-based compensation attributable to RSUs amounted to $ 621 and $ 639 , respectively.

Stock-Based Compensation Expense

During the three-month periods ended August 31, 2024 and 2023, stock-based compensation included in research and development expenses amounted to $ 131 and $ 155 , respectively, and in general and administrative expenses amounted to $ 231 and $ 233 , respectively.

During the six-month periods ended August 31, 2024 and 2023, stock-based compensation included in research and development expenses amounted to $ 261 and $ 315 , respectively, and in general and administrative expenses amounted to $ 471 and $ 428 , respectively.

During the three-month periods ended November 30, 2024 and 2023, stock-based compensation included in research and development expenses amounted to $ 106 and $ 161 , respectively, and in general and administrative expenses amounted to $ 224 and $ 236 , respectively.

During the nine-month periods ended November 30, 2024 and 2023, stock-based compensation included in research and development expenses amounted to $ 367 and $ 476 , respectively, and in general and administrative expenses amounted to $ 695 and $ 664 , respectively.

Equity Incentive Plan

6 unchanged sentences

However, where a participant, at the time of the grant, owns stock representing more than 10 % of the voting power of the Company, the life of the options shall not exceed 5 years.

The following table summarizes the continuity of the Company’s Equity Incentive Plan units that were authorized for issuance as at and during the six-month periods ended August 31, 2024 and 2023:

The following table summarizes the continuity of the Company’s Equity Incentive Plan units that were authorized for issuance as at and during the nine-month periods ended November 30, 2024 and 2023:

Number of units*

Authorized, beginning of period

5 unchanged sentences

*The use of the term “units” in the table above describes a combination of stock options and RSUs.

During the six-month period ended August 31, 2024, warrants for the purchase of 4,714,813 shares of our common stock, each with an exercise price of $ 15.00 , expired, and warrants for the purchase of 17,180 shares of our common stock, each with an exercise price of $ 11.00 also expired.

During the nine-month period ended November 30, 2024, warrants for the purchase of 4,714,813 shares of our common stock, each with an exercise price of $ 15.00 , expired, and warrants for the purchase of 17,180 shares of our common stock, each with an exercise price of $ 11.00 also expired.

Contractual agreements

Agreement with Reed Management SAS (“Reed”)

On May 30, 2024, the Company and Reed, a European investment firm, entered into definitive binding agreements, subject to certain closing conditions, for an investment of € 35 million from Reed to fund the global commercialization of the Infinite Loop™ Technology and have agreed to form a 50/50 joint venture for the European deployment of Loop’s technology.

Under the terms of the agreement, which has been signed following the completion by Reed of extensive operational, technical, ESG, and legal due diligence, Reed will provide capital as follows:

€ 10 M investment in a Convertible Preferred Security to be issued by Loop, which contains a 13 % PIK dividend rate and 5 -year term;

€25M loan to Loop in two equal tranches – first tranche to support global deployment opportunities paid at closing and second tranche to support European deployment opportunities paid in the following 12 months with both tranches having a 13% PIK interest rate and 3-year term ;

The closing of the transaction is subject to the fulfillment of certain closing conditions, principally the conditions that (i) Reed shall have completed its first capital raising for its fund;

and (ii) Loop shall have received a binding financing commitment from a governmental agency.

Strategic partnership with Ester Industries Ltd.

3 unchanged sentences

Subject to the terms of the relevant governing documents, Ester will be the exclusive producer of specialty polymers for the India JV, and the Company will be the exclusive seller and marketing agent of the India JV’s products.

Ester and the Company will work in collaboration on all financing activities for the India JV pursuant to the terms of the agreement.

Ester and the Company are contacted to work in collaboration on all financing activities for the India JV pursuant to the terms of the agreement.

Pursuant to the terms of the relevant governing documents, Loop and Ester parties are required to obtain debt for a minimum of 60% of the total installed cost of the Infinite Loop™ manufacturing facility in India and will each contribute 50% of the initial equity capital of the India JV .

Agreement with SK Geo Centric Co.

On April 27, 2023, the Company and SKGC entered into an agreement to build Infinite Loop ™ manufacturing facilities in Asia.

Pursuant to the agreement, the Company and SKGC agreed to form a new entity, which will be headquartered in Singapore.

To date, no amounts have been contributed by the Company to the new entity.

Subsequent event

Distribution from Joint Venture

The carrying value of the Company’s investment in Indorama Loop Technologies, LLC (“ILT”), its joint venture with Indorama Ventures Holdings LP, USA (“Indorama”), was $ 381 as at August 31, 2024, which represented the Company’s 50 % portion of the cash balance in ILT.

On October 9, 2024, ILT distributed a total of $735 in cash to the Company and Indorama, of which $368 was received by the Company.

The carrying value of the Company’s investment ILT was $13 after the distribution .

Subsequent events

Amended Agreement with Reed Management SAS (“Reed”)

On December 12, 2024, the Company entered into an Amended and Restated Share Purchase Agreement (the “Amended Agreement”) with Reed Management SAS (“Reed”), which amends the original Share Purchase Agreement dated May 30, 2024.

To facilitate the closing of the transactions contemplated by the Amended Agreement, a simplified joint-stock company is in the process of being incorporated under French law (“Infinite Loop Europe”), to be owned 90 % by Reed and 10 % by Loop.

On December 23, 2024, the Company closed the financing and licensing transactions contemplated by the Amended Agreement.

The Company issued and sold 1,044,430 shares of Series B Convertible Preferred Stock at $ 10.00 per share to Reed Circular Economy (“RCE”), an affiliate of Reed.

Additionally, the Company entered into a License Agreement with RCE, acting on behalf of Infinite Loop Europe, granting a non-transferable, royalty-bearing license to use Loop’s proprietary depolymerization technology for one facility within Europe.

The Company received total cash proceeds of $ 20,790 (€20,000) on December 23, 2024.

Terminated Agreement with SKGC

Effective January 14, 2025, Loop and SKGC have mutually agreed to terminate their joint venture agreement executed by the parties on April 27, 2023 to construct and operate an Infinite Loop™ manufacturing facility in Ulsan, South Korea.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements