Business Context and Reporting Period
This Form 8-K was filed by Loop Industries, Inc. on September 27, 2017, reporting a material definitive agreement entered into by its wholly-owned subsidiary, Loop Canada Inc.
Key Financial Metrics
The filing does not provide revenue, profit, cash flow, margin, debt, or liquidity metrics. The only financial data disclosed relates to the specific transaction:
- Purchase Price: $1.2 million CAD for property and equipment.
- Deposit Paid: $100,000 CAD.
- Balance Due: Payable on the closing date.
Material Changes
Loop Canada entered into a Promise to Purchase agreement to acquire industrial property located at 11455 Ontario East, Montreal, Quebec. The acquisition includes approximately 14,042 square meters of land, several buildings, a press filter, and a waste water biological treatment unit.
Outlook, Risks, and Contingencies
The transaction is subject to several contingencies and risks:
- Due Diligence: Loop Canada has until November 27, 2017, to perform due diligence. If unsatisfied, the agreement terminates and the deposit is returned.
- Rezoning Requirement: The property must be rezoned by November 27, 2017, at Loop Canada's expense.
- Default Risk: If the purchase is not completed due to a breach or default by Loop Canada, the $100,000 CAD deposit will be forfeited to the seller, Veolia.
- Right of First Refusal: Veolia retains a right of first refusal to purchase the equipment for five years following the closing.
Investor Verification Checklist
- Confirm the successful completion of the rezoning process by the November 27, 2017 deadline.
- Verify the results of the due diligence period to ensure the property meets Loop Canada's requirements.
- Monitor the closing date to confirm the transfer of the remaining balance and title.
- Review the attached Exhibit 1.1 for specific legal terms regarding the equipment and right of first refusal.