Intertape Polymer (ITPOF) 11-KAnnual report of employee stock purchases

The following description of the IPC Group 401(k) Plan (the “Plan”) provides only general information. Participants should refer to the amended Plan document and Summary of Plan Description for a more complete description of the Plan’s provisions.

Intertape Polymer Corp. and its participating subsidiaries (the “Company” and the "Plan Administrator") established the Intertape Polymer Group Inc. Employees’ Stock Ownership and Retirement Savings Plan effective January 1, 1994. As of January 1, 2001, the Plan was an Employee Stock Ownership Plan ("ESOP"). As of January 1, 2008, the Plan’s name was changed to Intertape Polymer Corp. USA Employees’ Stock Ownership and Retirement Savings Plan and as of May 1, 2017 the Plan's name was changed to Intertape Polymer Corp. USA Retirement Savings Plan and the ESOP provisions of the Plan were removed. Effective December 1, 2019, the Plan's name was changed to IPC Group 401(k) Plan.

Employees other than (i) employees covered under a collective bargaining agreement, (ii) non-resident aliens who do not receive any compensation from U.S. sources, (iii) leased employees, and (iv) individuals who are classified as students and/or interns are eligible to participate in the Plan for purposes of pre-tax salary deferrals and Roth deferrals (effective January 1, 2020) on the first day of the month coinciding with or next following the eligible employees’ attainment of age 18 and completion of three months of service, or for purposes of matching and Company contributions under the Plan, completion of six months of service.

Participants may contribute 1% to 100% of their pretax annual compensation, subject to Internal Revenue Service (“IRS”) limitations. Within those limits, participants may also choose to make contributions to the Plan on an after-tax basis by designating salary deferrals as Roth deferrals. Generally, the Plan will accept a rollover contribution from another qualified retirement plan or IRA.

Each participant’s account is credited with the participant’s contributions, Company contributions, and an allocation of the Plan earnings or losses. Allocations are based on participant earnings or account balances, as defined by the Plan. Each participant is entitled to the vested portion of their account. Participants may direct the investment of their account balances into various investment options, including the Parent Company's stock, offered by the Plan.

Participants are immediately vested in their pre-tax and Roth deferrals plus actual earnings thereon. Vesting in the Company contributions portion of the participants’ accounts plus earnings thereon is based on years of vesting service (12 continuous months of service beginning on the employee’s date of hire). A participant is 20% vested after each year of vesting service and 100% vested after the earlier of five years of vesting service, upon reaching early retirement age (age 55), death, or becoming disabled while employed.

Participants may borrow from their accounts a minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50% of the vested portion of the participant’s account balance. During 2020, CARES Act provisions permitted qualified individuals per IRS Notice 2020-50, to obtain notes of up to 100% of their vested balance or $100,000. However, in determining the availability of a note under the Plan, no note may be made from the Intertape Polymer Group, Inc. common trust fund (Note 3) during a closed period as defined in the Company's Insider Trading Policy applicable to employees. The notes are secured by the balance in the participant’s account and bear interest at a rate of one point above the prime borrowing rate, defined in the Plan document as the prime rate of interest as published in the Wall Street Journal on the date of the note commitment. Principal and interest repayments are made ratably through payroll deductions over a period not to exceed five years, unless the note was used to purchase a primary residence in which case the note terms may exceed five years, up to a maximum note term of 15 years. Interest rates for notes outstanding at December 31, 2020 and 2019 range from 4.25% to 6.50%. The Plan Administrator will suspend note repayments for a military service leave of absence. The Plan allows for participants to have only one note outstanding at any one time.

Upon separation of service due to death, disability, or retirement, a participant is entitled to receive their benefits as a lump-sum amount equal to 100% of the value of the participant’s account. Participants who are at least age 59-1/2 may request in-service withdrawals from their vested accounts. In addition, participants may request a distribution of their vested account balance if

they incurred a hardship under the Plan (effective December 1, 2019, hardship withdrawals are permitted from matching contributions and employer contributions under the Plan). Rollover contributions may be withdrawn at any time.

When certain terminations of participation in the Plan occur, the non-vested portion of the participant’s account, as defined in the Plan document, represents a forfeiture. Forfeitures are used to offset employer contributions and certain plan expenses.

There continues to be significant macroeconomic uncertainty, and the Company expects the COVID-19 pandemic may continue to have a materially negative impact on the global economy into the remainder of 2021 and perhaps beyond. While the Company has delivered positive financial results to date, the pandemic could yet materially impact the Company’s ability to manufacture, source (including the delivery of raw materials to its facilities) or distribute its products both domestically and internationally and reduce demand for its products, any of which could have a significant negative impact on the Company’s financial results in 2021 and beyond. Given the dynamic nature of the pandemic (including its duration and the severity of its impact on the global economy and the applicable governmental responses), the extent to which the COVID-19 pandemic impacts the Company’s future results will depend on unknown future developments and any further impact on the global economy and the markets in which the Company operates and sells its products, all of which remain highly uncertain and cannot be accurately predicted at this time. In addition, the impact could have a material adverse effect on the Plan's financial position.

The financial statements of the Plan are prepared using the accrual basis of accounting, in accordance with accounting principles generally accepted in the United States of America ("US GAAP")

The preparation of financial statements in accordance with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and changes therein, and disclosure of contingent assets and liabilities. Actual results could differ from those estimates.

Benefits are recorded when paid.

Certain Plan administrative expenses are paid by the Company. Participant-related fees and expenses are paid by the Plan through charges to participant accounts.

The Plan’s investments except for the Fixed Interest Fund (See Note 5) are stated at fair value. Purchases and sales of securities are recorded on a trade date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date. Net appreciation includes the Plan’s gains and losses on investments bought and sold as well as held during the year. See Note 6 for disclosures regarding fair value measurements.

Amounts payable to participants for contributions in excess of amounts allowed by the IRS are recorded as a liability with a corresponding reduction to contributions. The Plan distributed the 2020 and 2019 excess contributions to the applicable participants prior to March 15, 2021 and 2020, respectively.

At December 31, 2020 and 2019, the Plan held 784,035 shares (average cost per share of $6.44; market value per share of $19.03) and 657,794 shares (average cost per share of $5.80; market value per share of $12.87), respectively, of the Parent Company's common stock in the common trust fund, all of which was allocated to participant accounts. The common trust fund had cash and short-term investments of $646,185 and $373,296 of December 31, 2020 and December 31, 2019, respectively.

Effective March 1, 2019, Intertape Polymer Woven USA, Inc. was added as a participating employer to the Plan.

Through a group annuity contract, the Plan offers a fixed interest fund ("Fund"). The objective of this fund is to maintain a competitive fixed interest rate and a minimum guaranteed rate of return. The Fund is invested in the general asset account of

Massachusetts Mutual Life Insurance Company ("Mass Mutual") and is guaranteed by their claims paying ability. Mass Mutual credits the Fund with interest at a rate declared each calendar quarter, but not less than the minimum interest rate as specified in the contract. The contract has certain restrictions that impact the participants' ability to collect the full contract value. The Plan Administrator does not believe the occurrence of any event such as plant closings, plan termination or early retirement incentives which would limit the Plan's ability to transact at contract value with participants, is probable. The agreement does not allow transfers and surrenders from the Fund if the transactions in any 12-month period exceed one-sixth of the Fund values under the agreement as of the most recent month-end value from one year prior, unless Mass Mutual consents. Because the Fund is fully benefit-responsive, contract value is the relevant measurement attribute for that portion of the net assets available for benefits attributable to the fixed interest fund contract. The Fund is presented on the face of the statements of net assets available for benefits at contract value. Contract value, as reported to the Plan by Mass Mutual, represents contributions made under the contract, plus earnings, less participant withdrawals and administrative expenses. Participants may ordinarily direct the withdrawal or transfer of all or a portion of their investment at contract value.

The FASB Accounting Standards Codification (the “Codification”) provides a framework for measuring fair value. This framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3).

Transactions by the Plan with the common trust fund and notes receivable from participants qualify as parties-in-interest transactions. The fixed interest fund is managed by Mass Mutual and these transactions qualify as party-in-interest transactions.

Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event of Plan termination, participants would become 100 percent vested in their accounts.

The underlying volume submitter plan has received an opinion letter from the IRS dated March 31, 2014, stating that the form of the Plan is qualified under Section 401(a) of the IRC, and therefore, the related trust is tax-exempt. The Plan Administrator has determined that it is eligible to and has chosen to rely on the current IRS volume submitter plan opinion letter. The Plan Administrator believes that the Plan is designed and currently being operated in compliance with the applicable requirements of the IRC, in all material respects. As such, no provision for income taxes has been included in the Plan’s financial statements.

The Plan invests in various securities including mutual funds, bond funds, a fixed interest fund, and a common trust fund. Investment securities, in general, are exposed to various risks, such as interest rate, credit risk and overall market volatility. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect the amounts reported in the statements of net assets available for benefits.

The following is a reconciliation of net assets available for benefits per the financial statements to Form 5500:

The Company did not remit contributions of $50.68 timely for three participants for the December 5, 2019 pay date. The Plan funded missed earnings of $1.17 to the participants in 2020.