Loop Industries, Inc. announced that the Company signed a non-binding Memorandum of Understanding ("MOU") with Reed, a European investment firm focused on high impact and technology-enabled infrastructure. Loop and Reed intend to form a strategic long-term partnership through the establishment of a 50/50 joint venture (the "JV") to commercialize Loop's technology in Europe. Reed intends to provide financing of EUR60 million (US$66 million) in non-dilutive capital.

The transaction is expected to close by the end of March 2024. Under the terms of the MOU, Reed will provide capital as follows: USD 11 million equity investment in the JV to acquire from Loop exclusive rights to co-invest alongside Loop in commercialization projects using Loop's technology in Europe through the planned joint venture between Loop and Reed; USD 22 million loan from the JV to Loop in two equal tranches - first tranche paid at closing and second tranche paid in the following 12 months with both tranches having a 10% PIK rate and 3-year term; The planned partnership with Reed leverages the in-depth industry experience of Reed's leadership in the development and financing of infrastructure projects throughout Europe as well as their established financing relationships with major institutions. Reed's experienced investment team is augmented by world-class industry leaders and operating partners with significant expertise in the infrastructure, climate change and investment industries, with a strong network of alliances of large cap companies in the energy, water and waste sectors.

This intended partnership allows for Loop Industries to reduce the funding needs for its equity contributions to support the rollout of an increased number of facilities to be constructed in the European market using the Infinite LoopTM technology. Led by Julien Touati, Reed Management is leveraging the multi-decade experience of its team and partners to support the scale-up of capital and technology intensive solutions enabling to shift essential infrastructure and deliver long-term, stable returns with a strong impact. Such risks and uncertainties include, without limitation, risks and uncertainties associated with among other things: commercialization of technology and products, (ii) status of relationship with partners, (iii) development and protection of intellectual property and products, (iv) industry competition, (v) need for and ability to obtain additional funding relative to current and future financial commitments, (vi) engineering, contracting, and building the manufacturing facilities, (vii) ability to scale, manufacture, and sell the products in order to generate revenues, (viii) proposed business model and the ability to execute thereon, (ix) the ability to obtain the necessary approvals or satisfy any closing conditions in respect of any of any of any of the proposed partnerships, (x) joint venture projects and the ability to recover certain expenditures in connection therewith, (xi) adverse effects on the Company's business and operations as a result of increased regulatory, media, or financial reporting scrutiny, practices, rumors, or otherwise, (xii) disease epidemics and other health-related concerns and crises, which could result in reduced access to capital markets, supply chain disruptions and scrutiny, embargoing of goods produced in affected areas, government-imposed mandatory business closures and any resulting furloughs of employees, government employment subsidy programs, travel restrictions or the like to prevent the spread of disease, or market or other changes that could result in non-cash impairments of the intangible assets, and property, plant and equipment, (xiii) the effect of the continuing worldwide macroeconomic uncertainty and its impacts, including inflation, market volatility and fluctuations in foreign currency exchange and interest rates, (xiv) adverse effects on the Company' business and operations as a result the Company's business and operations.