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(1) | To elect four members of the Board of Directors to hold office until the next annual meeting of stockholders or until their respective successors have been elected and qualified; |
(2) | To ratify the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for the fiscal year ending February 28, 2022; |
(3) | To hold an advisory vote on executive compensation; and |
(4) | To transact such other business as may properly come before the meeting or any postponement or adjournment thereof. |
| | By Order of the Board of Directors, | ||
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| (s) Drew Hickey | |||
| Drew Hickey | |||
| | Chief Financial Officer | ||
| | Terrebonne, Québec |
| | Page
i Each share of our common stock, par value $0.0001 per share (the “Common Stock”), entitles the holder thereof to one vote on matters to be acted upon at the The Inspector of Elections will determine whether or not a quorum is present at the In determining whether a proposal has been approved, abstentions are treated as present in person or represented by proxy and entitled to vote, but not as voting for such proposal, and hence have the same effect as votes against such proposal, while broker non-votes are not treated as present in person or represented by proxy but not entitled to vote, and hence have no effect on the vote for such proposal. Holders of record of Common Stock as of the close of business on May Proxies for use at the Proposals of stockholders that are intended to be presented at our 1 The expense of solicitation of proxies will be borne by the Company. In addition to solicitation of proxies by mail, certain officers, directors and Company employees, who will receive no additional compensation for their services, may solicit proxies by telephone or in person. We are required to request brokers and nominees who hold stock in their name to furnish this proxy material to beneficial owners of the stock and will reimburse such brokers and nominees for their reasonable out-of-pocket expenses in so doing. 2 ELECTION OF DIRECTORS At the The following table sets forth, as of February
Daniel Solomita, Andrew Lapham, 48, has served as a member of our Board of Directors since June 2019. Mr. Lapham has had a successful career as a financial professional with experience covering plastic manufacturing. In 2013 Mr. Lapham co-founded and continues to serve as the Global and Canadian Chair of Northern Private Capital Inc., a private investment firm. Mr. Lapham previously served as the Chairman of Blackstone Canada, an alternative asset manager, which focused primarily on sourcing and evaluating the firm’s investment opportunities in Canada. Mr. Lapham also served as the senior investment professional at Onex Corporation, headquartered in Toronto. Mr. Lapham holds a Bachelor of Arts degree with a major in History from Princeton University. Mr. Lapham’s understanding of the economics and strategic elements of business, and his expertise in corporate finance make him qualified be on the Board. Laurence Sellyn, 3 Administrative Officer of Gildan Activewear Inc. from April 1999 until August 2015. From 1992 until 1999 he was Chief Financial Officer and Senior Vice President of Finance and Corporate Development of Wajax Inc. Previously Mr. Sellyn held successive positions of increasing responsibility at Domtar Inc., including serving as Corporate Controller from 1987 until 1991. Jay Stubina, 59, has served as a member of our Board of Directors since 2016. In 1998, Mr. Stubina co-founded Continent 8 Technologies, which operates data centers in Europe, North America and Asia. He led its operating and sales activities until April 2021, when he retired from the company and divested his equity ownership position. Mr. Stubina holds a Bachelor of Commerce degree, with a major in Accountancy from Concordia University, of Montréal in Canada. Mr. Stubina obtained a Chartered Accountant certificate from McGill University, and maintains a Chartered Professional Accountant designation in Canada. Mr. Stubina serves on our Audit and Compensation Committees. His experience running a business from 1998 to the present, combined with his previous role as CFO of a real estate company from 1989-1998 and his Chartered Professional Accountant designation make Mr. Stubina a valuable member of our Audit Committee and the Board of Directors. Mr. Stubina’s knowledge of and experience in finance, technology implementation in businesses and data management led to our conclusion that he is qualified to serve as a director in light of our business and structure. Louise Sams, 63, Peter Kezios, 62, will not stand for re-election to the 4 The nominees receiving a greater number of affirmative votes FOR his or her election than votes AGAINST his or her election shall be elected as directors. Unless marked to the contrary, proxies received will be voted “FOR” for each of the Board’s nominees. Abstentions and broker non-votes will not affect the outcome of the vote. THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE “FOR” FOR EACH OF THE BOARD’S NOMINEES ON THE ELECTION OF THE FOREGOING NOMINEES TO SERVE AS DIRECTORS UNTIL THE NEXT ANNUAL MEETING OF STOCKHOLDERS. 5 The Board has established the following three (3) committees, each with its own written charter: the Audit Committee, the Nominating and Corporate Governance Committee, and the Compensation Committee. The following table sets forth the attendance of the current Directors at the Board and Committee meetings held during the fiscal year ended February
Our shares of Common Stock are listed on the Nasdaq Stock Market. Nasdaq requires all of its listed companies to be in compliance with Nasdaq’s standards of corporate governance set forth in the Nasdaq Marketplace Rules (the “Nasdaq CG Rules”), with certain exceptions. Companies that qualify as a “controlled company” within the meaning of the Nasdaq CG Rules can elect not to comply with certain Nasdaq CG Rules or can choose to comply with these rules despite the presence of an exemption. Under Nasdaq CG Rules, “controlled companies” may elect not to comply with certain Nasdaq CG Rules, including: requirements relating to oversight of director nominations, including having a nominating committee be composed entirely of independent directors; requirements relating to oversight of executive compensation, including that having a compensation committee that is composed entirely of independent directors; and the requirement that a majority of the members of the Board be independent. As of February The Board of Directors has determined the following directors are independent: The Board currently combines the role of Chairman of the Board and Chief Executive Officer. This is because of the unique role played by Daniel Solomita as the Founder, Chief Executive Officer and controlling shareholder of 6 the Company. The Board believes that Mr. Solomita is best situated to serve as Chairman because he is the director most familiar with our business and industry and is therefore best able to identify the strategic priorities to be discussed by the Board. The Board believes that combining the role of Chairman and Chief Executive Officer, in the current circumstances of the Company, facilitates information flow between management and the Board and fosters strategic development and execution. The Board has appointed Laurence Sellyn as the lead independent director. The lead independent director serves as the focal point for independent directors, coordinating feedback to the Chief Executive Officer on behalf of the independent directors regarding business issues and board management. The lead independent director and the other independent directors meet regularly without the Chief Executive Officer present. The Board of Directors has three standing committees: an Audit Committee, a Nominating and Corporate Governance Committee and a Compensation Committee. These committees meet regularly throughout the year and also hold special meetings or act by written consent from time to time as appropriate. The Board has delegated various responsibilities and authority to its committees as generally described below. The committees regularly report on their activities and actions to the Board. Each of these committees has adopted a written charter, which is reviewed annually. All members of the committees are appointed by the Board of Directors and meet the independence requirements of the respective committees on which they serve. The Nomination and Corporate Governance Committee recommends the composition of the Audit Committee and the Compensation Committees after the election of directors is approved by the shareholders, for approval by the Board. Audit Committee The Audit Committee consists of Mr. Sellyn (Chair), Mr. Lapham and Mr. Stubina, each of whom is independent within the meaning of the requirements of the Sarbanes-Oxley Act of 2002, applicable SEC rules and the listing standards of the Nasdaq Stock Market. The Audit Committee held four meetings during the fiscal year ended February The Board of Directors has determined that Mr. Sellyn is an audit committee financial expert as defined by Item 407(d)(5)(ii) of Regulation S-K of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Mr. Sellyn’s relevant experience includes 23 years of service as a Chief Financial Officer, first at Wajax Inc. from 1992 until 1999, and then at Gildan Activewear Inc. from 1999 until his retirement in 2015. He is also a U.K. Chartered Accountant. The Audit Committee oversees our accounting and financial reporting process and the audit of our financial statements and also assists the Board in monitoring our financial systems and legal and regulatory compliance. In accordance with the written Audit Committee Charter, the responsibilities of the Audit Committee include, among other things: appointing, determining the compensation of, retaining and overseeing the work of our registered public accounting firm engaged for the purpose of preparing or issuing an audit report or performing other audit, review, or attest services for us; pre-approval of auditing and permissible non-audit services, and the terms of such services, to be provided by the independent registered public accounting firm; evaluating the independence, qualifications and performance of our registered public accounting firm, including an annual review of a written report by our independent registered public accounting firm regarding the independent registered public accounting firm’s internal quality control procedures and various issues relating thereto; reviewing our financial statements, including meeting with management and our independent registered public accounting firm to review and discuss our annual audited financial statements, quarterly financial statements, and related disclosures; reviewing, approving, and monitoring related party transactions involving directors or executive officers; 7 addressing complaints received by us regarding accounting, internal accounting controls or auditing matters and procedures for the confidential, anonymous submission by our employees of concerns regarding questionable account or auditing matters; periodically reviewing and meeting with management and the independent auditor to discuss the overall adequacy and effectiveness of our legal, regulatory and ethical compliance programs and reports regarding compliance with applicable laws, regulations and internal compliance programs; meeting with management and, as appropriate, the independent auditors, to discuss the adequacy and effectiveness of our policies and practices regarding information technology risk management and the internal controls related to cybersecurity; overseeing management’s processes for identifying, monitoring and addressing enterprise risks; and reporting to the Board, including, among other things, any issues that arise with respect to the quality or integrity of our financial statements, compliance with legal or regulatory requirements, the performance and independence of the independent auditors, and the performance of the Audit Committee itself. The Audit Committee Report is included in this http://www.loopindustries.com/assets/docs/loop_audit_committee_charter.pdf Compensation Committee The Compensation Committee consists of Mr. Lapham (Chair), Mr. The Compensation Committee oversees our compensation policies, plans and programs. The Compensation Committee is responsible for, among other things: establishing and periodically reviewing a general compensation strategy for the Company and its subsidiaries and overseeing the development and implementation of our compensation plans to ensure they are consistent with the general compensation strategy; reviewing and discussing with management the risks arising from our compensation policies and practices for all employees that are reasonably likely to have a material adverse effect on the Company; administering our equity-based plans; periodically reviewing and recommending the compensation of our chief executive officer and other executive officers to the Board for its approval; periodically reviewing and approving corporate goals and objectives relevant to compensation of our chief executive officer and other executive officers; periodically evaluating the performance of our chief executive officer in light of such corporate goals; oversight of regulatory compliance with respect to compensation matters affecting us; reviewing and recommending to the Board our submissions to stockholders on executive compensation matters and considering the results of stockholder advisory votes on executive compensation matters and the changes, if any, to our executive compensation policies, practices and plans that may be warranted as a result of any such vote. The Board adopted a written charter for the Compensation Committee, a copy of which is available under Corporate Governance Documents in the Investors section of our website, and via the following hyperlink: http://www.loopindustries.com/assets/docs/ 8 Nominating and Corporate Governance Committee The Nominating and Corporate Governance Committee consists of Mr. The Nominating and Corporate Governance Committee considers and periodically reports to the full Board on matters relating to the governance of the Board. The Nominating and Corporate Governance Committee is responsible for, among other things: reviewing the qualifications of, and recommending to the Board, proposed nominees for election to the Board, Board composition, and appointment to committees of the Board, consistent with criteria approved by the Board and subject to any commitments made by the Corporation by contract or in its certificate of incorporation; developing, evaluating and recommending to the Board corporate governance practices applicable to the Company; leading the Board in its annual performance review of the Board, its committees and their respective effectiveness; and assisting management to organize appropriate orientation for new directors. The Board of Directors adopted a written charter for the Nominating and Corporate Governance Committee in May 2018, a copy of which is available under Corporate Governance Documents in the Investors section of our website, and via the following hyperlink: http://www.loopindustries.com/assets/docs/Nominating-and-Corporate-Governance-Committee-Charter.pdf Stockholder Nominees The Nominating and Corporate Governance Committee will consider properly submitted stockholder nominations for candidates for membership on the Board of Directors as well as candidates recommended for consideration by the Nominating and Corporate Governance Committee as described below under “Identifying and Evaluating Nominees for Directors.” Any stockholder nominations must comply with the requirements of our By-laws and should include disclosure about whether the nominating shareholder or any member of a nominating shareholder group has been involved in any legal proceeding during the past ten years, as specified in Item 401(f) of Regulation S-K, all information relating to such nominee as would be required to be disclosed in solicitations of proxies for the election of such nominee as a director pursuant to Regulation 14A under the Exchange Act, such nominee’s written consent to be named in the A stockholder that instead desires to merely recommend a candidate for consideration by the Nominating and Corporate Governance Committee shall direct the recommendation in writing to Loop Industries, Inc., Attention: Chief 9 Director Qualifications In discharging its responsibilities to nominate candidates for election to the Board of Directors, the Nominating and Corporate Governance Committee has not specified any minimum qualifications for serving on the Board of Directors. We believe that our directors should have the highest professional and personal ethics and values, consistent with our values and standards. They should have broad experience at the policy-making level in business or banking. They should be committed to enhancing stockholder value and should have sufficient time to carry out their duties and to provide insight and practical wisdom based on experience. Their service on other boards of public companies should be limited to a number that permits them, given their individual circumstances, to perform responsibly all director duties for us. Each director must represent the interests of all stockholders. When considering potential director candidates, the Nominating and Corporate Governance Committee also considers the candidate’s character, judgment, diversity, age and skills, including financial literacy and experience in the context of our needs and the needs of the Board. Identifying and Evaluating Nominees for Directors Under the Nasdaq CG Rules, we are not required to maintain a nominating committee. Instead, our entire Board was responsible for recommending director candidates for election until we formed a Nominating and Corporate Governance Committee in May 2018. This was appropriate, in the opinion of the Board, because we are a “controlled company” under Nasdaq CG Rules, as a single investor, Daniel Solomita, holds Prior to the formation of the Nominating and Corporate Governance Committee in May 2018, the Board had been identifying and evaluating nominees for our Board. The Nominating and Corporate Governance Committee utilizes a variety of methods for identifying and evaluating director nominees. Candidates may come to the attention of the Nominating and Corporate Governance Committee through current members of the Board of Directors, professional search firms, stockholders or other persons. These candidates are evaluated at regular or special meetings of the Nominating and Corporate Governance Committee and may be considered at any point during the year. As described above, the Nominating and Corporate Governance Committee will review properly submitted stockholder nominations and recommendations for candidates for the Board of Directors. Following verification of the stockholder status of persons proposing candidates, nominations and recommendations are aggregated and considered by the Nominating and Corporate Governance Committee. If any materials are provided by a stockholder in connection with the nomination or recommendation of a director candidate, such materials are forwarded to the Nominating and Corporate Governance Committee. The Nominating and Corporate Governance Committee also reviews materials provided by professional search firms or other parties in connection with a nominee who is not proposed by a stockholder. Although we do not have a formal policy regarding attendance by members of the Board of Directors at our annual meetings of stockholders, directors are encouraged to attend our annual meetings. 10 the Company’s independent registered public accounting firm for fiscal year We have not implemented a formal policy or procedure by which our stockholders can communicate directly with our Board of Directors. Nevertheless, every effort has been made to ensure that the views of our stockholders are heard by the Board of Directors or individual directors, as applicable, and that appropriate responses are provided to our stockholders in a timely manner. We believe that we are responsive to stockholder communications, and therefore have not considered it necessary to adopt a formal process for stockholder communications with our Board. During the upcoming year, our Board will continue to monitor whether it would be appropriate to adopt such a process. On January 25, 2017, our Board approved and adopted a Code of Ethics (the “Code of Ethics”) that applies to all of our directors, officers, and employees, including our principal executive officer and principal financial officer. The Code of Ethics addresses such individuals’ conduct with respect to, among other things, conflicts of interests; compliance with applicable laws, rules, and regulations; full, fair, accurate, timely, and understandable disclosure by us; competition and fair dealing; corporate opportunities; confidentiality; insider trading; protection and proper use of our assets; fair treatment; and reporting suspected illegal or unethical behavior. A copy of our Code of Ethics is available under Corporate Overview in the Investors section of our website, and via the following hyperlink: http://www.loopindustries.com/assets/docs/ Each of our executive officers and directors has entered into an indemnification agreement, pursuant to which we have agreed to indemnify each such person for claims against each of them that may arise in connection with the performance of their respective duties as an officer or a director. Although no officers of the Company currently have a Rule 10b5-1 stock trading plan in place, officers may choose to enter into such plans from time to time in the future. These plans allow executives to adopt predetermined plans for trading shares of our Common Stock in advance of learning any material non-public information. The use of these trading plans permits diversification, retirement and tax planning activities. The transactions under the plans will be disclosed publicly through Form 4 filings with the SEC. The Board, and in particular the Audit Committee, has an active role, as a whole and also at the committee level, in overseeing management of Company risk. This role is one of informed oversight rather than direct management of risk. The Board regularly reviews and consults with management on strategic direction, challenges and risks that we face. The Board also reviews and discusses with management quarterly financial results and forecasts. The Audit Committee of the Board oversees management of financial risks, including investment and foreign currency fluctuation risk mitigation policies. The Compensation Committee of the Board is responsible for overseeing the management of risks relating to and arising from our compensation plans and arrangements. The Nominating and Corporate Governance Committee periodically reviews the risks arising from our corporate governance policies and practices, including the structure and performance of the Board, its committees and individual directors. The Nominating and Corporate Governance Committee also reviews and oversees the Company’s succession planning process for executive officers. These committees provide regular reports—generally on a quarterly basis—to the full Board. Management has responsibility for the direct management and oversight of legal, financial and commercial compliance matters, which includes identifying areas of risk and implementing policies, procedures and practices to mitigate the identified risks. Additionally, the Chief Financial Officer 11 concerning financial, tax and compliance related risks. Management also provides the Audit Committee with periodic reports on our compliance programs and efforts, investment policy and practices, and compliance with debt covenants. Management and any compensation consultant, if so retained, provide analysis of risks related to our compensation programs and practices to the Compensation Committee. The Board approved our Outside Director Compensation Policy in October 2017, which was amended and restated on April 4, 2018, May 11, 2018, Cash Compensation.All non-employee directors will be entitled to receive the following cash compensation for their services: $15,000 per year for service as chairman of the audit committee; $15,000 per year for service as chairman of the compensation committee; $15,000 per year for service as chairman of the nominating and governance committee; $30,000 per year for service as the lead independent director. Each annual cash retainer under this Policy will be paid quarterly in arrears on a prorated basis to each non-employee director who has served in the relevant capacity at any point during the immediately preceding fiscal quarter, and such payment shall be made no later than thirty (30) days following the end of such immediately preceding fiscal quarter. Equity Compensation.Nondiscretionary, automatic grants of restricted stock units (“RSUs”) will be made to our non-employee directors on an annual basis as described below: Annual Awards. Subject to Section 11 of the Company’s 2017 Equity Incentive Plan, each non-employee director automatically will be granted a Restricted Stock Unit Award (an “Annual Award”) with a Value of Consistent with the previous paragraph, an Annual Award was granted on June Travel Expenses.Each non-employee director’s reasonable, customary, and properly documented travel expenses to attend Board meetings will be reimbursed by the Company. 12 The following table sets forth a summary of the compensation received by our non-employee directors who received compensation during our fiscal year ended February
Directors who are also our employees receive no additional compensation for their service as directors. During fiscal year Our non-employee directors held the following outstanding RSU awards as of February
13 The following table identifies certain information about our executive officers as of February
Daniel Solomita, please see biography of Mr. Solomita on page 3 of this Nelson Gentiletti, Michel Megelas, Stephen Champagne, 53, is an engineer and was appointed as Chief Technology Officer in March 2020. Mr. Champagne’s experience includes laboratory development through engineering, procurement, and construction, as well as commercial plant commissioning. Prior to joining the Company, Mr. Champagne was the Director of the Process Group at Seneca Engineering until January 2020. Mr. Champagne also served as Chief Technology Officer of Lithion Recycling from July 2018 until January 2020. Mr. Champagne received his B. Eng. from Université Laval in 1993 and became a member of the Ordre des ingénieurs du Québec in 1995. Yves Perron, 58, Mr. Perron was appointed Vice-President, Engineering and Construction in January 2021. He is responsible for project execution, permitting, engineering, procurement and contracting, construction and project control. Mr. Perron is an experienced executive with over 30 years of leadership experience in engineering, construction and project management in the industrial space, notably with mining, metallurgy and engineering consulting companies. Prior to joining the Company, Mr. Perron served as Vice-President, Engineering and Construction for Stornoway Diamonds from June 2012 until May 2019. Thereafter, he served as Executive Vice President Engineering, Construction & Reliability with Mason Graphite from June 2019 until December 2020. Mr. Perron holds a B. Eng from École de Technologie Supérieure (UQAM), as well as an MBA from Université du Québec à Montréal and an Executive MBA from Université Paris Dauphine. 14 Compensation Discussion and Analysis This Compensation Discussion and Analysis highlights the objectives and philosophy of our executive compensation program, describes each component of our executive compensation program, and explains the decisions of the Board and the Compensation Committee in designing our executive compensation program for fiscal 2020. In fiscal Daniel Solomita, our Chairman of the Board, Chief Executive Officer and President; Nelson Gentiletti, our Chief Operating Officer, Chief Financial Officer and Treasurer; Michel Megelas, our Chief Legal Officer and Stephen Champagne, our Chief Technology Officer; Vice-President, Engineering and Construction Executive Changes Mr. Gentiletti retired effective March 1, 2021 and remained with the Company until April 30, 2021. Mr. effective March 19, 2021. Executive Compensation Within this template, we continue to use judgement on a case-by-case basis when hiring new executives, in order to attract, motivate and retain the management talent required to support the implementation of our business plan, bearing in mind both external market conditions and internal compensation equity within the company, and being mindful of our position as a pre-revenue company which Our founder and We seek to support Mr. Solomita by identifying and What we do: The Compensation Committee consists entirely of independent directors. A significant portion of the compensation opportunity of each continuing named executive officer is tied to the achievement of specified performance goals and/or has underlying value tied directly to our stock price, and is therefore at-risk. Executive officers are required to provide service to us over a period of at least three to five years in order to fully vest in time-based equity awards. 15 What we do not do: We do not provide any “single trigger” change in control payments or benefits to our named executive officers that remain with us. We do not provide any post-employment retirement or pension benefits to our executive officers that are not available to our employees generally. We do not provide tax gross-ups for payments or benefits paid in connection with a change in control. We do not permit short sales, hedging, or pledging of stock ownership positions Impact of We conducted a vote to approve, on an advisory or non-binding basis, the compensation of our named executive officers (commonly known as a “Say-on-Pay” vote) at our Executive Compensation Program Design Our executive compensation program for fiscal We offer Additionally, long-term equity awards for shares of our common stock serve as a key component of our executive compensation program. Currently, we grant (i) stock options to ensure that the recipient receives value only through driving stockholder value; and (ii) full value awards, or awards without a purchase price, including RSUs, to provide appropriate levels of compensation, to facilitate retention, to provide more direct alignment to our stockholders and to promote stockholder value creation given that the value of a recipient’s shares increases only as stockholder value increases. In the future, we may introduce other forms of equity awards, as we deem appropriate, that further our objective of providing long-term incentives to our named executive officers while promoting stockholder value creation. On a case-by-case basis there may be a need to provide an up-front incentive to attract a qualified candidate. Such awards will typically be in the form of stock options and RSUs and will vest Finally, we offer our executive officers standard health and welfare benefits that are generally available to our other employees, including medical, dental, vision, short-term disability, long-term disability, and life insurance plans. Our senior executive pay philosophy and framework includes guidelines for allocating compensation between short-term and long-term incentive compensation that provide for a large portion of incentive compensation to be tied to performance objectives. We use competitive market data to develop a general framework for establishing the appropriate pay levels and mix. Within this overall framework, the Compensation Committee reviews each component of executive compensation separately and also takes into consideration the value of each named executive officer’s compensation package as a whole and its relative value in comparison to our other named executive officers. 16 The Board and the Compensation Committee evaluate our compensation philosophy and executive compensation program as circumstances require and review executive compensation annually. The Board and the Compensation Committee apply our philosophy and the objectives outlined above, together with consideration for the levels of compensation that we would be willing to pay to ensure that our executive compensation remains competitive for highly-qualified talent and that we meet our recruiting and retention objectives, as well as the cost to us if we were required to find a replacement for a key executive officer. Compensation-Setting Process Role of Our Compensation Committee Compensation decisions for our named executive officers generally are recommended by the Compensation Committee and approved by the Board. Currently, the Compensation Committee is responsible for reviewing, and evaluating the compensation arrangements, plans, policies, and practices for our named executive officers. The Compensation Committee periodically reviews our executive compensation program, including base salary, short-term incentive compensation and long-term equity compensation, to determine whether they are appropriate, properly coordinated, and achieve their intended purposes, and to make any modifications to existing plans and arrangements or to adopt new plans or arrangements. In connection with such review and the hiring of executive officers, the Compensation Committee, after consulting with our management team and any compensation consultant that the Compensation Committee may engage and reviewing any market data provided by such compensation consultant, makes recommendations to the Board with respect to any base salary adjustments, target incentive amounts and compensation framework. With respect to our short-term and long-term incentive compensation, the Compensation Committee recommends to the Board for approval Role of Management In carrying out its responsibilities, the Compensation Committee works with members of our management team, including our Chief Executive Officer Except with respect to his own compensation, our Chief Executive Officer will make recommendations to the Compensation Committee regarding compensation matters, including the compensation of our executive officers. Our Chief Executive Officer also participates in meetings of the Compensation Committee, except with respect to discussions involving his own compensation, in which case the Committee meets in executive session without the Chief Executive Officer present. While the Compensation Committee solicits the recommendations and proposals of our Chief Executive Officer with respect to compensation-related matters, these recommendations and proposals are only one factor in the Compensation Committee’s decision-making process. Role of Compensation Consultant The Compensation Committee has the authority to retain the services of external advisors, including compensation consultants, legal counsel and other advisors, from time to time, as it sees fit in connection with carrying out its duties. In fiscal Use of Competitive Data Our Compensation Committee considers 17 At the current stage of our development, we are dependent upon a small team of key executives to support Mr. Solomita in pursuing our business objectives, including the continued development of our technology and the development and implementation of our commercialization plan. We continue to operate within an overall compensation framework and philosophy which was established in 2018 and which is described herein. This philosophy, as well as Mr. Solomita’s compensation, was established at the time with reference to a benchmark group of comparable companies and using external advisors. Within this framework, we use judgement on a case-by-case basis when hiring new executives, in order to attract the management talent required to support the needs of the business, bearing in mind both external market conditions in the Montreal market and internal compensation equity within the company. Fiscal Overview For fiscal The following describes each component of our executive compensation program, the rationale for each, and how the compensation amounts and awards were determined for fiscal Base Salary Base salary is the primary fixed component of our executive compensation program. We use base salary to compensate our named executive officers for services rendered during the fiscal year and to ensure that we remain competitive in attracting and retaining executive talent. Generally, we establish the initial base salaries of our executive officers through arm’s-length negotiation at the time we hire the individual executive officer, taking into account his or her position, qualifications, experience, salary expectations, market compensation data and the base salaries of our other executive officers. Thereafter, the Compensation Committee periodically reviews the base salaries of each named executive officer and makes adjustments as it determines to be reasonable and necessary to reflect our performance, the scope of a named executive officer’s performance, contributions, responsibilities, experience, current salary level, position (in the case of a promotion), and market pay positioning, as appropriate. In connection with the amendment and restatement of Mr. Solomita’s employment agreement in fiscal 2019, the Compensation Committee reviewed his compensation package, including his base salary. In addition to the market-based study provided by Pay Governance, the Compensation Committee also considered other relevant factors, including, among others, Mr. Solomita’s Mr. Gentiletti’s base salary was set at $535,000 CAD upon his hire in December 2018, In fiscal The base salaries paid to our named executive officers in fiscal Short-Term Incentive Compensation We use short-term incentive compensation to motivate our named executive officers to achieve our annual financial and operational objectives, while making progress towards our longer-term strategic and growth goals. Our 18 short-term incentive program allows the Compensation Committee to provide cash or equity incentive awards to the executive officers, which are based upon performance goals established by the Board and the Compensation Committee. The short-term incentive compensation provided to our named executive officers in fiscal Daniel Solomita and Nelson Gentiletti The compensation package for Mr. Solomita that the Compensation Committee recommended, and the Board approved, in June 2018 in connection with the amendment and restatement of his employment agreement includes an annual bonus opportunity for fiscal 2020 that provides for a payment equal to 25% of his base salary at threshold performance, 50% of his base salary at target performance, or 100% of his base salary at maximum performance. Mr. Gentiletti’s employment agreement provides for a short-term incentive compensation opportunity in the form of cash (or, at his option, in RSUs or stock options), with payment equal to 25% of his base salary at threshold performance, 50% of his base salary at target performance, or 100% of his base salary at maximum performance. Mr. Gentiletti’s short-term incentive compensation opportunity was determined based on arm’s-length negotiations between him and our Chief Executive Officer and evaluated relative to an analysis of competitive compensation practices. In The achievement of these performance goals (as indicated in the table below) was determined to be at Performance goals included: (i) strategic goals related to the Indorama Loop Technologies joint venture, (ii) development goals for Infinite LoopTM greenfield facilities, (iii) operational goals, (iv) engineering related goals, and (v) financing goals. Michel Megelas Mr. Megelas’ employment agreement provides for a short-term incentive compensation in the form of cash, with payment equal to 10% of his base salary at threshold performance, 20% of his base salary at target performance, or 30% of his base salary at maximum performance. If performance Mr. Megelas’ fiscal 2021 annual bonus performance was determined on a discretionary basis. Pursuant to his Stephen Champagne Mr. 19 Yves Perron Mr. Perron’s employment agreement provides for a short-term incentive compensation in the form of cash, with payment equal to 10% of his base salary at threshold performance, 20% of his base salary at target performance, or 30% of his base salary at maximum performance. If performance is below threshold performance, there would be no award. Mr. Perron’s fiscal 2021 annual bonus performance was determined on a discretionary basis. Pursuant to his performance, Mr. Perron received a bonus for fiscal 2021 in the amount of $7,680 CAD, which represented 2.6% of his base salary, or 19.5% of his base salary pro-rated based on the portion of the year during which he was employed by the Company. Long-Term Incentive Compensation We grant long-term equity awards as a component of our executive compensation program in order to align our named executive officers’ long-term interests with our stockholders’ interests. Our long-term incentive program allows the Compensation Committee to provide equity incentive awards to the executive officers, which are based upon performance goals established by the Board and the Compensation Committee. The Company has elected to use equity-based awards in order to provide direct alignment to stockholder value, as reflected by the price of our common stock. In determining the composition of these equity awards, the Compensation Committee decided to offer some new hires The size of the equity awards granted to our named executive officers in connection with their hire is determined through arm’s-length negotiation, taking into consideration factors such as the named executive officer’s role and responsibilities, the named executive officer’s compensation provided by the prior employer and new target cash compensation, the equity award’s potential retention and incentive value, market data on the size of new-hire awards provided by similar companies to similarly situated employees, and prevailing market conditions. The long-term equity awards granted to our named executive officers in fiscal Daniel Solomita Mr. Solomita’s amended and restated employment agreement made no change to the equity incentive arrangement described in his prior employment agreement, which provided for an award of 4,000,000 RSUs that had not yet been granted. In June 2018, the Board approved the grant of these RSUs which became effective with the approval by the Company’s stockholders at the Company’s 2019 annual meeting of an increase in the number of shares available for issuance under the Company’s 2017 Equity Incentive Plan. In April 2020, the Board clarified and updated the milestones consistent with the shift in our business from the production of terephthalate (“PTA”) to the production of dimethyl terephthalate (“DMT”), another proven monomer of PET plastic that is far simpler to purify. One-quarter of the RSUs vest upon the achievement of each of following four performance milestones: (i) the Company’s securities are listed on an exchange or the OTCQX tier of the OTC Markets Group Nelson Gentiletti Mr. Gentiletti’s employment agreement provides for a fiscal 20 In fiscal 2021, the Board approved the following equity award grant to Mr. Gentiletti: (i) in March 2020, 31,762 time-based long-term incentive RSUs. This equity award is scheduled to vest, subject to continued service through each vesting date, in 1/3rd increments on the first three anniversaries of the grant date. In fiscal 2020, the Board approved the following equity award grants to Mr. Gentiletti: (i) in March 2019, 14,422 time-based long-term incentive RSUs, and (ii) in July 2019, 8,734 performance-based long-term incentive Michel Megelas Mr. Megelas’s new hire employment agreement provided for a new hire equity award of RSUs with an intended value of $40,000. In Stephen Champagne Mr. Yves Perron Mr. Perron’s new hire employment agreement provides for a new hire equity award of RSUs with an intended value of $250,000. In fiscal 2021, the Board approved an equity award grant to Change in Control and Severance Benefits We have entered into employment agreements with our named executive officers that provide for certain payments and benefits upon the termination of their employment under certain circumstances. We believe that these employment agreements provide retention value by encouraging our named executive officers to continue service with us and increase stockholder value by reducing any potential distractions caused by the possibility of involuntary termination or a potential change in control, allowing our named executive officers to focus on their duties and responsibilities. For a summary of the material terms and conditions of these employment arrangements, see the section below entitled “Potential Payments upon Termination or Change in Control.” Other Compensation and Benefits We provide employee benefits to all eligible employees, including our named executive officers. As discussed above, these benefits include medical, dental and vision insurance, life and disability insurance, and other plans and programs. Stock Trading Practices; Hedging and Pledging Policy We maintain an Insider Trading Policy that, among other things, prohibits our employees, including our named executive officers, from trading during quarterly and special blackout periods. In addition, we prohibit short sales, hedging and similar transactions designed to decrease the risks associated with holding our securities, as well as pledging the company’s securities as collateral for loans and transactions involving derivative securities relating to our common stock. Our Insider Trading Policy requires that all directors and officers, including our named executive officers, pre-clear with our legal department any proposed open market transactions. Further, we have adopted Rule 10b5-1 trading plan guidelines that permit our directors and employees, including our named executive officers, to adopt Rule 10b5-1 trading plans. Under these guidelines, Rule 10b5-1 trading plans may only be adopted or modified 21 during an open trading window under our Insider Trading Policy and only when such individual does not otherwise possess material nonpublic information about the company. These guidelines also provide for a cooling-off period before the first trade may occur under a Rule 10b5-1 trading plan. Executive Pay Program Risk Assessment The Compensation Committee and management discuss and evaluate our compensation program and policies for our employees (including our named executive officers) to determine whether they encourage excessive risk-taking and to assess policies and practices that could mitigate such risks. In addition, the Compensation Committee had previously engaged Pay Governance to independently review our executive compensation program. Based on these reviews, the Compensation Committee designs our executive compensation program to encourage our named executive officers to focus on our short-term and long-term success, and for the following reasons, the Compensation Committee believes that any risks arising from compensation program and policies are not reasonably likely to have a material adverse effect on the Company: Company’s Use of a mix of cash and equity-based awards Inclusion of relevant milestones or other metrics (recognizing our emerging status currently makes it challenging to set multi-year performance goals) Structure of the Chief Executive Officer’s RSU award which necessitates achieving critical milestones on our road to product commercialization Significant outright equity ownership by our Chief Executive Officer Tax and Accounting Considerations Deductibility of Executive Compensation Section 162(m) of the Internal Revenue Code, or Section 162(m), generally limits the amount we may deduct from our federal income taxes for compensation paid to our Taxation of “Parachute Payments” and Deferred Compensation If certain service providers receive payments or benefits in connection with a change in control that exceeds certain prescribed limits, they may be subject to an excise tax under Section 4999 of the Internal Revenue Code, and we may lose the ability to deduct the amounts subject to this excise tax under Section 280G of the Internal Revenue Code. Section 409A of the Internal Revenue Code, or Section 409A, imposes significant additional taxes on service providers that receive “deferred compensation” that does not meet the requirements of Section 409A. In fiscal Accounting Considerations We follow the authoritative accounting guidance under ASC Topic 718 for our share-based awards. ASC Topic 718 requires companies to measure the compensation expense for all share-based equity awards made to employees (including named executive officers) and directors based on the grant date “fair value” of these awards. ASC Topic 718 also requires companies to recognize the compensation cost of share-based awards in their income statements over the periods that the employees or directors are required to render service in order to vest in the awards. The grant date “fair value” of the awards granted to our named executive officers have been calculated for accounting purposes and reported in the tables 22 Compensation Committee Report The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management and, based on such review and discussions, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement. The Compensation Committee
The information contained in the Compensation Committee Report shall not be deemed to be soliciting material or to be filed with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act or the Exchange Act, except to the extent that the Company specifically incorporates it by reference in such filing. 23 COMPENSATION TABLES The following table presents summary information regarding the compensation reportable for our named executive officers for fiscal
Grants of Plan-Based Awards for Fiscal The following table presents, for each of our named executive officers, information concerning grants of plan-based awards made during fiscal
Outstanding Equity Awards at Fiscal Year-End The following table sets forth all outstanding equity awards held by each Named Executive Officer as at February
25 Equity Compensation Plan Information in Fiscal 2021 As at February
Option Exercises and Stock Vested in Fiscal 2021 The following table provides information on vesting of RSUs during fiscal
Pension Benefits and Nonqualified Deferred Compensation We do not provide a pension plan for our employees, and none of our named executive officers participated in a nonqualified deferred compensation plan during fiscal 2021. Potential Payments upon Termination or Change in Control Mr. Daniel Solomita On July 13, 2018, we entered into an amended and restated employment agreement, with no term, with Daniel Solomita, our President and Chief Executive Officer, such agreement referred to as the Solomita Amended and Restated Employment Agreement. 26 Pursuant to the Solomita Amended and Restated Employment Agreement, Mr. Solomita received an award of 4,000,000 RSUs, subject to the terms of our 2017 Equity Incentive Plan and a Restricted Stock Unit Agreement thereunder. Such grant became effective upon shareholder approval of an increase in the number of shares available for grant under the Plan at the Company’s 2019 Annual Meeting. The RSUs will vest upon the occurrence of certain milestones as follows: 1,000,000 RSUs will vest when the Company’s securities are listed an exchange or the OTCQX tier of the OTC Markets; 1,000,000 RSUs will vest when the Company executes a contract for a minimum quantity of 25,000 M/T of DMT/MEG or PET; 1,000,000 RSUs will vest when the Company’s first full-scale production facility is in commercial operation; and 1,000,000 RSUs will vest when the Company’s second full-scale production facility is in commercial operation. For these purposes, “commercial operation” means the full-scale production facility produces 10 metric tons per hour of DMT and MEG combined, for a term of not less than 6 months. Once vested in accordance with the milestones, one-fifth of the RSUs will be settled annually, generally commencing on the first settlement date following the date of vesting. The first performance milestone has been reached and consequently, 1,000,000 RSUs have vested effective June 27, 2019, of which the first installment of 200,000 RSUs was settled on October 15, 2019 and the second installment of 200,000 RSUs was settled on October 15, 2020. If Mr. Solomita’s employment is involuntarily terminated by the Company without Cause prior to a Change of Control or more than 24 months following a Change of Control (as such terms are defined in the Solomita Amended and Restated Employment Agreement), Mr. Solomita will receive: (i) continued payment of his base salary for a period equal to 24 months, (ii) payments by the Company for the full cost of his medical benefits provided by the Company under which he is covered as of the date of his termination of employment for up to 24 months, (iii) if he is eligible as of the date that his employment is terminated to participate in a formal cash annual incentive plan as the Company may make available to its similarly-situated employees, a lump-sum payment equal to a pro-rated portion of the incentive payment payable to him under such cash annual incentive plan based on actual performance at the end of the performance period, (iv) accelerated vesting of 50% of the then-unvested portion of his outstanding equity compensation, (v) reimbursement for up to $10,000 of expenses incurred in obtaining new employment. If Mr. Solomita’s employment is terminated by the Company without Cause or by his Resignation for Good Reason (as defined in the Solomita Amended and Restated Employment Agreement) within 24 months after a Change in Control, Mr. Solomita will receive following severance benefits: (i) a lump sum payment equal to 24 months of his base salary, (ii) payments by the Company for the full cost of his medical benefits provided by the Company under which he is covered as of the date of his termination of employment for up to 24 months, (iii) if he is eligible as of the date that his employment is terminated to participate in a formal cash annual incentive plan as the Company may make available to its similarly-situated employees, a lump-sum payment equal to a pro-rated portion of the incentive payment payable to him under such cash annual incentive plan based on actual performance as of the date his employment is terminated and as soon as reasonably practicable following such date (or if such performance is not determinable at such time, based on target performance) and a lump-sum payment equal to two times the target incentive payment payable under the applicable cash annual incentive plan, (iv) accelerated vesting of 100% of the 4,000,000 RSUs described above, (v) reimbursement for up to $20,000 of expenses incurred in obtaining new employment. The receipt of the severance benefits described above are subject to Mr. Solomita’s timely executing and not revoking a release of claims and his continued compliance with his proprietary information and inventions agreement with the Company and the post-employment non-competition, non-solicitation, and non-disparagement covenants in the Solomita Amended and Restated Employment Agreement. The Solomita Amended and Restated Employment Agreement also provides that in the event any amounts in the agreement or otherwise payable to him constitute “parachute payments” within the meaning of Section 280G of the 27 Internal Revenue Code of 1986, as amended (the “Code”), and could be subject to the related excise tax, he would be entitled to receive either full payment of benefits or such lesser amount that would result in no portion of the benefits being subject to an excise tax, whichever results in the greater amount of after-tax benefits to him. For the purposes of the Solomita Employment Agreement, “Cause” means any grounds entitling the Board to summarily dismiss Mr. Solomita. For purposes of the Solomita Amended and Restated Employment Agreement, “Resignation for Good Reason” generally means, Mr. Solomita’s resignation as a result of, and within 30 days following, (i) a change in Mr. Solomita’s position such that he is not a corporate officer of the Company (or a successor company in the event of a Change of Control), (ii) a significant and substantial reduction in Mr. Solomita’s job, duties, or responsibilities in a manner that is substantially and materially inconsistent with the position, duties, or responsibilities held by Mr. Solomita immediately before such reduction, (iii) any reduction in Mr. Solomita’s base salary other than in connection with and consistent with a general reduction of all officer base salaries; or (iv) a relocation of Mr. Solomita’s work location to a location more than 50 kilometers away from the current location provided such change increases Mr. Solomita’s commute by 25 kilometers or 30 minutes. The Solomita Amended and Restated Employment Agreement prohibits Mr. Solomita from engaging in certain activities which compete with our business, seeking to recruit our employees or disclosing any of our trade secrets or otherwise confidential information. The foregoing description of the Solomita Amended and Restated Employment Agreement is a summary and is qualified in its entirety by the text of the Solomita Amended and Restated Employment Agreement, as amended, a copy of which is as an exhibit to our Form 8-K filed with the Securities and Exchange Commission on July 13, 2018. Mr. Nelson Gentiletti On December 18, 2018, our wholly-owned subsidiary, Loop Canada Inc., entered into an employment agreement with no term commencing on January 1, 2019 with Nelson Gentiletti, our Chief Operating and Chief Financial Officer, such agreement referred to as the Gentiletti Employment Agreement. 2021. Mr. Michel Megelas On May 28, 2019, our wholly-owned subsidiary, Loop Canada Inc., entered into an employment agreement with no term, to commence on June 25, 2019, with Mr. Michel Megelas, our Chief Legal Officer, such agreement referred to as the Megelas Employment Agreement. Mr. Megelas resigned from the Company on March 19, 2021. Mr. Stephen Champagne On January 30, 2020, our wholly-owned subsidiary, Loop Canada Inc., entered into an employment agreement with no term, to commence on March 9, 2020, with Mr. Stephen Champagne, our Chief Technology Officer, such agreement referred to as the Champagne Employment Agreement. Pursuant to the (i) his annual short-term incentive award prorated to the date of termination based on actual performance, payable in one lump-sum within the later of 30 days of termination for time-based awards or shortly after performance is determined at the end of the next quarterly reporting period for performance awards; (ii) a lump-sum payment equal to For the purposes of the 28 (iii) Mr. As required by the Mr. Yves Perron On Pursuant to the Perron Employment Agreement, if Mr. (i) his annual short-term incentive award prorated to the date of termination based on actual performance, payable in one lump-sum within the later of 30 days of termination for time-based awards or shortly after performance is determined at the end of the next quarterly reporting period for performance awards; (ii) a lump-sum payment equal to ten (10) months of his then-current base salary; and (iii) his new hire RSU award will be paid as if vested ratably over a period of sixty (60) months from the date of Board approval, with any such RSUs that are vested as of the date of termination to be paid in one lump sum within 30 days of termination. For the purposes of the Perron Employment Agreement, “Serious Reason” means a serious reason pursuant to Article 2094 of the Civil Code of Quebec and includes, without limitation, (i) Mr. Perron’s breach of a material term of the Perron Employment Agreement; (ii) Mr. Perron’s conviction of a criminal offence involving fraud or dishonesty, or which otherwise adversely impacts the reputation of the Company; (iii) Mr. Perron directly or indirectly making personal profit out of or in connection with a transaction or business opportunity to which the Company is involved or otherwise associated with, without making disclosure to and seeking the prior written consent of the Company; (iv) Mr. Perron’s failure to comply with any Company rules or policies of a material nature; (v) Mr. Perron’s continued failure to substantially perform his job duties; (vi) any actions or omissions on As required by the Perron Employment Agreement, Mr. Perron has signed and agreed to be bound by a Non-Competition, Non-Solicitation and Non-Disparagement Agreement. 29 Estimated Payments Upon Termination or Change in Control The following table provides an estimate of the payments and benefits that would be provided in the circumstances described above for each of the named executive officers, assuming the triggering event took place on February
Our Board of Directors has adopted a written related party transactions policy. All transactions required to be reported pursuant to Item 404 of Regulation S-K are subject to approval by the Audit Committee of our Board of Directors. In furtherance of relevant Nasdaq rules and our commitment to corporate governance, the charter of the Audit Committee provides that the Audit Committee shall review and approve any proposed related party transactions including, transactions required to be reported pursuant to Item 404 of Regulation S-K. The Company is also required by Nasdaq Rule 5250(b)(3) to disclose all agreements and arrangements between any director or nominee for director, and any person or entity other than the Company, relating to compensation or other payment in connection with such person’s candidacy or service as a director of the Company. The Company is not aware of any such agreements. In evaluating transactions with related parties, our Audit Committee considers all of the available material facts and circumstances of a related person transaction, including: the direct and indirect interests of the related persons; in the event the related person is a director or nominee for director (or immediate family member of a director or an entity with which a director is affiliated), the impact that the transaction will have on a director’s or nominee for director’s independence; the risks, costs and benefits of the transaction to us; and whether the transaction is on terms no less favorable than terms generally available to an unaffiliated third-party under the same or similar circumstances. Transactions and Relationships with Directors, Director Nominees, Executive Officers and Five Percent Stockholders We believe that there have not been any transaction or series of transactions during fiscal Proxy Statement. Mr. Daniel Solomita, our controlling stockholder and Chief Executive Officer, or companies controlled by him, previously made advances to the Company which were unsecured, non-interest bearing with no formal terms of repayment. As of May 4, 2018, we do not owe any money to Mr. Solomita or entities controlled by him. 31 RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM On August 16, 2017, the Audit Committee approved the appointment of PricewaterhouseCoopers LLP (“PwC”) as our independent registered public accounting firm. The selection and engagement of PwC as our independent registered public accounting firm was approved by the Board on August 16, 2017, effective as at August 16, 2017. On June A representative of PwC may be present at the 2020 The following table sets forth the approximate aggregate fees paid by us to our independent registered public accounting firms during the fiscal
Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm The Sarbanes-Oxley Act of 2002 and the auditor independence rules of the SEC require all independent registered public accounting firms that audit issuers to obtain pre-approval from their respective audit committees in order to provide professional services without impairing independence. As such, our Audit Committee has a policy and has established procedures by which it pre-approves all audit and other permitted professional services to be provided by our independent registered public accounting firm. Our audit committee’s policy is to pre-approve all audit and permissible non-audit services provided by the independent accountants. These services may include audit services, audit-related services, tax services and other services. Our audit committee generally pre-approves particular services or categories of services on a case-by-case basis. The independent registered public accounting firm and management are required to periodically report to our audit committee regarding the extent of services provided by the independent registered public accounting firm in accordance with these pre-approvals, and the fees for the services performed to date. On January 9, 2018, the Audit Committee approved the Audit and Non-Audit Services Pre-Approval Policy (“Pre-Approval Policy”) effective for 32 the fiscal year ended February 28, 2018 and subsequent fiscal years. Of the fees paid in fiscal year 2021, 96% were approved by the Audit Committee using the pre-approval policies and procedures described herein. Of the fees paid in fiscal year 2020, 96% were approved by the Audit Committee using the pre-approval policies and procedures described herein. Unless marked to the contrary, proxies received will be voted “FOR” approval of the ratification of the appointment of PwC as our independent registered public accounting firm for the fiscal year ending February 28, THE LOOP BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT LOOP STOCKHOLDERS VOTE “FOR” RATIFICATION OF APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM. 33 The Audit Committee of the Board of Directors is responsible for providing an independent, objective review of our accounting functions and internal controls. The Audit Committee is comprised of Mr. Sellyn, Mr. Lapham and Mr. Stubina, each of whom is independent within the meaning of the listing standards of the Nasdaq Stock Market, and was governed by a written charter first adopted and approved by the Board of Directors, and who reviewed the Audit Committee Report for the fiscal year ended February 2021. In connection with our audited financial statements for the fiscal year ended February The Audit Committee has considered and determined that the provision of the services other than audit services referenced above is compatible with maintenance of the auditor’s independence. Based upon these reviews and discussions, the Audit Committee recommended to the Board of Directors, and the Board of Directors approved, that our audited financial statements be included in our Annual Report on Form 10-K for the fiscal year ended February
34 The following table sets forth certain information with respect to the beneficial ownership of our Common Stock and Series A Preferred Stock as at May The amounts and percentages of our Common Stock and Series A Preferred Stock beneficially owned are reported on the basis of the regulations of the SEC governing the determination of beneficial ownership of securities. Under these rules, a person is deemed to be a beneficial owner of a security if that person has or shares voting power, which includes the power to vote or to direct the voting of such security, or investment power, which includes the power to dispose of or to direct the disposition of such security. A person is also deemed to be a beneficial owner of any securities of which that person has the right to acquire beneficial ownership within 60 days. Holders of our Common Stock and Series A Preferred Stock vote together as a single class. The one share of Series A Preferred Stock issued to Mr. Solomita affords him a majority of the total voting power so long as Mr. Solomita holds not less than 7.5% of the issued and outstanding shares of our common stock, assuring that Mr. Solomita retains control with his presently-held Subject to the paragraph above, percentage ownership of outstanding shares is based on
ADVISORY VOTE ON EXECUTIVE COMPENSATION Pursuant to Section 14A of the Exchange Act, which was put in place by the Dodd-Frank Act, we are providing shareholders with a vote to approve, on an advisory basis, the compensation of our Named Executive Officers as disclosed in this Proxy Statement in accordance with SEC rules. The advisory vote on executive compensation described in this proposal is commonly referred to as a “say-on-pay” vote. As a result of the vote of our shareholders to Proposal Five at our 2019 Annual Meeting, we are required to provide our shareholders the opportunity to vote to approve, on an advisory basis, the compensation of our Named Executive Officers every year. The principal objectives of our executive compensation program are: To attract and retain executive officers with the skills, experience and motivation to enable us to achieve our stated objectives; To provide a mix of current, short-term and long-term compensation to achieve a balance between current income and long-term incentive opportunity and promote focus on both annual and multi-year business objectives; To align total compensation with the performance commitments we seek for our shareholders, including, long-term growth in revenue and EPS; To allow executive officers who demonstrate consistent performance over a multi-year period to earn above-average compensation when we achieve above-average long-term performance; To be affordable and appropriate in light of our size, strategy and anticipated performance; and To be straightforward and transparent in its design, so that shareholders and other interested parties can clearly understand all elements of our compensation programs, individually and in the aggregate. This proposal gives our shareholders the opportunity to express their views on the overall compensation of our Named Executive Officers and the philosophy, policies and practices described in this Proxy Statement. For the reasons discussed above, we are asking our shareholders to indicate their support for our executive compensation by voting FOR, on an advisory basis, the compensation of our Named Executive Officers, as disclosed in this Proxy Statement pursuant to the compensation disclosure rules of the Securities and Exchange Commission (which disclosure includes the Summary Compensation Table and the other related tables and disclosure). The say-on-pay vote is an advisory vote only, and therefore it will not bind us or our Board of Directors or our Compensation Committee. However, the Board of Directors and the Compensation Committee will consider the voting results as appropriate when making future decisions regarding executive compensation. If a quorum is present, in order to approve the advisory vote on executive compensation, the number of votes cast “FOR” the proposal must exceed the number of votes cast “AGAINST” the proposal. Abstentions and broker non-votes are counted for purposes of determining whether a quorum exists at the Annual Meeting but will have no effect on the determination of the outcome of this proposal. THE LOOP BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT LOOP STOCKHOLDERS VOTE “FOR” THE APPROVAL OF THE ADVISORY RESOLUTION RELATING TO THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS. 37 As of the date of this proxy, management knows of no business or nominations that will be presented for consideration at the Section 16(a) of the Exchange Act and the rules of the SEC thereunder require our executive officers, directors and certain stockholders who beneficially own more than 10% of our common stock to file reports of ownership and changes in ownership of our Common Stock with the SEC. Based solely on a review of the copies of such reports furnished to us and representations that no other reports were required, we believe that all required reports were filed on time with the Some banks, brokers and other nominee record holders may participate in the practice of “householding” proxy statements and their accompanying documents. This means that only one copy of our annual report, If you receive your proxy materials by mail, we encourage you to elect to receive future copies of our proxy materials by e-mail. To enroll in this program, follow the instructions included on your Notice We filed our Annual Report on Form 10-K for the fiscal year ended February The cost of soliciting proxies will be borne by the Company. Officers, other employees and directors may solicit proxies personally or by telephone without any addition to their regular compensation. Upon request, we will reimburse the reasonable costs incurred by brokers, banks, or other nominees for mailing proxy materials and annual shareholder reports to the beneficial owners of the shares they hold of record. The information contained in this Proxy Statement under the caption “Audit Committee Report” shall not be deemed to be |