Loop Media, Inc. (OTC Pink: LPTV), a provider of video services, has announced a series of executive changes, including the departure of its Chief Financial Officer (CFO) and three board members, effective September 30, 2024. The company confirmed the resignation of Directors Jon Niermann, David Saint-Fleur, and Sonya Zilka, stating that their departures were not due to disagreements on company operations, policies, or practices. Niermann will continue his role in sales and distribution within the company's management team.
Neil Watanabe, the outgoing CFO, left to pursue other opportunities after his employment agreement expired. Under a separation agreement effective October 4, 2024, Watanabe will receive several benefits, including six months' severance pay, a lump-sum payment due for the fiscal year 2022 bonus, and an extension for exercising stock options until September 30, 2026. He will also advise the company under a Consultant Advisory Agreement, receiving 40,000 restricted stock units (RSUs) with a vesting schedule ending September 30, 2025.
Ari Olgun has been appointed as the Interim CFO beginning October 1, 2024. Olgun, who joined Loop Media in March 2022 as VP Controller and served as a Director of subsidiary EON Media Group Pte. Ltd., brings a wealth of experience from various financial roles, including founding California Language Academy and working in SPAC and Technical Accounting for Surf Air. His interim CFO employment letter agreement includes an annual base salary of $275,000, subject to a temporary reduction in line with other executives, and participation in standard benefit plans.
In related news, the company's Board of Directors has extended the deferral of their cash compensation from fiscal year 2024 until September 30, 2025, and agreed to eliminate cash compensation for non-employee directors for fiscal year 2025. Additionally, the payment of fiscal year 2022 bonuses to certain executive officers has been postponed to September 30, 2025.
To retain employees following the delisting from the New York Stock Exchange American and subsequent OTC Pink Current trading, the Board approved a stock option repricing for certain non-executive employees.
In other recent news, Loop Media saw significant financial shifts. The company's shareholders approved an increase in authorized shares from 150,000,000 to 225,000,000. This move could provide Loop Media with greater flexibility for future corporate endeavors. In addition, Loop Media secured $700,000 through a future receipts sale to CFG Merchant Solutions, providing immediate working capital, and a $525,000 subordinated loan from Agile Capital Funding.
Loop Media reported a 26% drop in fiscal Q2 2024 revenue, totaling $4 million, and a decrease in gross profit margin to 10.4% from 29.4% in the previous year. In the light of these developments, Loop Media extended its loan agreement with GemCap Solutions to July 29, 2025, and added its subsidiary, Retail Media TV, as a co-borrower.
Due to the low selling price of its common stock, Loop Media's common stock was delisted from the NYSE American and began trading on the OTC Pink Market.
Despite this, NYSE American LLC has granted Loop Media until October 23, 2025, to meet the continued listing standards. As part of the recent developments, Loop Media announced plans to introduce several Free Ad-Supported Streaming TV (FAST) channels.
InvestingPro Insights
Loop Media's recent executive changes and financial restructuring come at a critical time for the company. According to InvestingPro data, Loop Media's market cap stands at a modest $5.09 million, reflecting its current challenges. The company's revenue for the last twelve months as of Q3 2024 was $24.21 million, with a concerning revenue growth decline of -36.46% over the same period.
InvestingPro Tips highlight that Loop Media is "quickly burning through cash" and "operates with a significant debt burden." These factors likely contributed to the executive changes and cost-cutting measures outlined in the article. The tip noting that "short term obligations exceed liquid assets" further underscores the company's financial pressures, explaining the deferral of board compensation and executive bonuses.
The stock's performance has been particularly troubling, with InvestingPro data showing a -93.7% year-to-date price total return. This aligns with the InvestingPro Tip that the "price has fallen significantly over the last year," providing context for the company's decision to reprice stock options for non-executive employees to enhance retention.
For investors seeking a more comprehensive analysis, InvestingPro offers 13 additional tips that could provide further insights into Loop Media's financial situation and future prospects.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.