LYLT Loyalty Ventures Inc

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

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SCHEDULE 14A

(Rule 14a-101)

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INFORMATION REQUIRED IN THE PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of

the Securities Exchange Act of 1934 (Amendment No. )

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Items of Business and Board Voting Recommendation

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YOUR VOTE IS IMPORTANT. You are cordially invited to attend the virtual meeting, but whether or not you plan to participate in the 2022 Annual Meeting, we urge you to grant your proxy to vote in advance of the meeting by following the instructions included on the Notice of Internet Availability of Proxy Materials you received, or if you received a paper copy of the proxy card, to mark, date, sign and return the proxy card in the envelope provided. You may still vote electronically if you attend the virtual meeting, even if you have given your proxy as your proxy is revocable at your option.

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The 2022 Annual Meeting will be held entirely online, where you will be able to vote your shares electronically and submit questions in advance of and during the virtual meeting. We are committed to providing expanded access and improved communication, allowing stockholders to participate from any location around the world the same as if attending in person, at no additional cost to them.

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To attend the 2022 Annual Meeting, examine our list of stockholders, vote and/or submit your questions in advance of or during the 2022 Annual Meeting, please register by visiting www.proxydocs.com/LYLT, and entering the unique control number on your proxy card, Notice of Internet Availability of Proxy Materials or instructions accompanying the proxy materials you previously received. Upon completing your registration, you will receive an email with additional instructions and a unique link that will allow you to access the 2022 Annual Meeting. If you have difficulty accessing the meeting, you may call the technical support number included in the instructional email and technicians will be available to assist you.

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The Notice of Internet Availability of Proxy Materials, or this proxy statement and the accompanying proxy card, notice of meeting and annual report on Form 10-K for the year ended December 31, 2021 were first mailed on or about April 14, 2022 to stockholders of record as of March 28, 2022.

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By order of the Board of Directors,

April 14, 2022

Loyalty Ventures Inc.

8235 Douglas Avenue, Suite 1200

Cynthia L. HagemanDallas, Texas 75225

Corporate Secretary

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Important Notice Regarding the Availability of Proxy Materials for the Annual Stockholders Meeting to be held on May 26, 2022. This Notice of Meeting, Proxy Statement, and Annual Report on Form 10-K for the year ended December 31, 2021 are available free of charge at https://www.loyaltyventures.com/investor-relations or on the Securities and Exchange Commission’s, or SEC’s, website at www.sec.gov. Alternatively, you may access our proxy materials at www.proxydocs.com/LYLT, a site that does not have “cookies” that identify visitors to the site.

: Go to www.proxypush.com/LYLT, enter your control number and follow the prompts. ​	​ 1-866-366-0987; have your control number handy and follow the prompts. ​	​ : If you received a paper copy of the proxy materials by mail, mark, sign, date, and promptly mail the enclosed proxy card in the postage-paid envelope. ​	QR Code: Scan the QR code using your mobile device; have your control number handy and follow the prompts. ​
By Internet: Go to www.proxypush.com/LYLT, enter your control number and follow the prompts.	By Toll-free Telephone: From the United States, U.S. territories, and Canada, call 1-866-366-0987; have your control number handy and follow the prompts.	​ ​ By Mail: If you received a paper copy of the proxy materials by mail, mark, sign, date, and promptly mail the enclosed proxy card in the postage-paid envelope.	By QR Code: Scan the QR code using your mobile device; have your control number handy and follow the prompts.

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CONTENTS

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Corporate Governance

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Loyalty Ventures Inc. began trading on the Nasdaq Global Select Market, or Nasdaq, as a new, independent publicly-traded company on November 8, 2021 following our spinoff from former parent company, Bread Financial Holdings, Inc. (formerly Alliance Data Systems Corporation), or ADS, with inclusion in the S&P SmallCap 600 index shortly thereafter. Loyalty Ventures’ advent coincides with a time of increased focus on corporate responsibility in environmental, social and governance, or ESG, matters. As our nascent corporation and board of directors assesses and builds on the strong foundation formed by our established operational businesses—the AIR MILES^® Reward Program and BrandLoyalty—our journey begins with their nearly thirty years experience and the fundamentals of effective corporate governance established while we were part of publicly-traded ADS prior to our spinoff. As a new company, our amended and restated certificate of incorporation provides certain protective features intended to shield our stockholders from coercive or otherwise unfair takeover tactics with the intent to provide our board of directors the opportunity to assess any acquisition proposal and negotiate directly with interested parties. A number of these provisions, including the classification of our board of directors, prohibition on stockholders calling special meetings and supermajority voting requirements for amendment of our current certificate of incorporation and bylaws, expire automatically following the completion of our annual meeting of stockholders in 2028. In addition, due to our “emerging growth company” status as defined in the Jumpstart Our Business Startups Act, or JOBS Act, our required disclosures in this proxy statement are reduced. As Loyalty Ventures progresses in its inaugural year, we intend to evaluate and address the diverse priorities and interests of all stakeholders in our business, from stockholders to sponsors, retailers, collectors, consumers, suppliers, employees and the communities where we live and work.

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Board Oversight Role

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Our board of directors oversees the financial strength and overall health of Loyalty Ventures, with the primary objective of optimizing stockholder value over the long term. In fulfillment of this core responsibility, the directors exercise their business judgment to fulfill their duty of care to make informed, deliberative decisions based on all material information reasonably available and their duty of loyalty to act (or not act) in a disinterested and independent basis, in good faith and with an honest belief that each action is in the best interests of Loyalty Ventures and our stockholders. Our directors must fulfill their responsibilities consistent with their fiduciary duties to the stockholders and in compliance with applicable laws, rules and regulations.

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Our board of directors oversees the senior management team, who are responsible for the day-to-day conduct of our business. The board of directors’ span of oversight includes advising on a range of matters including, but not limited to, business strategy, risk assessment and mitigation, compliance, leadership development and succession, operational performance, corporate governance, human capital and sustainability. Where appropriate, our board of directors will also take into consideration the interests of other stakeholders, including employees and the communities where we operate.

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Board Structure, Leadership and Committees

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Our amended and restated bylaws provide the size of our board of directors may be between three and twelve directors. We currently have five directors, including four non-employee directors. Assuming stockholders re-elect our director nominee, our board of directors will remain five directors.

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Our amended and restated certificate of incorporation classifies our board of directors into three classes of roughly equal size. The term for our initial directors designated as Class I, Class II and Class III directors expire at the annual meeting of stockholders in 2022, 2023 and 2024, respectively. After expiration of these initial terms, our directors will be elected by class for three-year terms. Our board of directors will transition to a fully declassified board through a phase-out, beginning with the annual meeting in 2029. Our five initial directors are distributed to Class I, Class II and Class III in groups of one, two and two, respectively, as follows:

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Class I:Barbara L. Rayner

Class II:Charles L. Horn; Richard A. Genovese

Class III:Graham Atkinson; Roger H. Ballou

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Pursuant to the terms of the Internal Revenue Service, or IRS, private letter ruling with respect to our spinoff from ADS, Roger H. Ballou currently serves as chair of our board of directors for a single three-year term ending in 2024, after which he will not seek re-election. Our corporate governance guidelines provide that while our board of directors currently believes best practice entails having a non-executive chair, the choice of whether the roles of chair of the board of directors and chief executive officer may be combined remain in the business judgment of the board of directors for consideration with respect to the relevant circumstances at the time of such decision. As discussed above, Mr. Ballou will remain the chair of our board of directors for the duration of his tenure. Following the annual meeting of stockholders in 2024, per our corporate governance guidelines, the board of directors will select the next chair of our board of directors from among its members at the time.

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As indicated previously, the classification of our board of directors protects our interests and that of our stockholders from takeover attempts by increasing the length of time necessary to change the composition of a majority of our board of directors. In general, at least two annual meetings of stockholders will be necessary to effect a change in a majority of the members of our board of directors. Based on the equal distribution criteria, the addition of any new director would be to Class I.

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Each director shall be elected by the vote of a plurality of the shares represented in person or by proxy at any meeting and entitled to vote in the election of directors. Until the declassification of our board of directors, no director will be removable by the stockholders except for cause, and directors may be removed for cause by the stockholders only by an affirmative vote of the majority of the total voting power of outstanding securities generally entitled to vote in the election of directors. Any vacancy occurring on the board of directors and any newly created directorship may be filled only by a majority of the remaining directors in office (although less than a quorum) or by the sole remaining director.

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Board Diversity

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New Nasdaq Rule 5605(f)(2)(A) requires listed companies to have (or publicly disclose why they do not have) at least two diverse directors, with at least one director that self identifies as female and at least one director that self identifies as an underrepresented minority or as LGBTQ+ all as defined by Nasdaq with certain phase-in, cure and grace periods. Further, new Nasdaq Rule 5606(a) requires that listed companies annually disclose and post to their website a board diversity matrix and subsequent to the first year provide information for both the current and prior year. Under new Nasdaq Rule 5605(f)(2)(D), listed companies with smaller boards of five directors or less may satisfy the diversity requirements with one diverse director.

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As provided in the Nasdaq continued listing standards, our board of directors maintains an audit committee and a compensation committee and our corporate governance guidelines also provide for a standing corporate governance and nominating committee. Our board of directors may from time to time establish or eliminate such other standing or special committees as it deems necessary or appropriate. Pursuant to our corporate governance guidelines, the board of directors appoints committee members. Consideration will be given to rotating committee members periodically, but rotation will not be mandated as a policy. Each committee member must satisfy the membership requirements set

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forth in the relevant committee charter consistent with Nasdaq and Securities and Exchange Commission, or SEC, requirements, including with respect to independence. The chair of each committee will determine the frequency and length of committee meetings and will develop the committee’s agenda for each meeting in accordance with the responsibilities or other parameters set out in their respective committee charters as discussed more fully below.

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Sustainability Strategy

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Sustainability – whether it refers to the ability to maintain growth, avoid depletion of natural resources or otherwise minimize our impact on our planet – benefits us all, from our investors to our employees, clients, consumers, reward suppliers and the communities where we live and work. These stakeholders look to Loyalty Ventures to design and implement long-term, sustainable policies that support growth while simultaneously addressing the environmental and social impacts of our company. With ESG already embedded in our performance goals for 2022 by the compensation committee of our board of directors, the corporate governance and nominating committee of our board of directors will oversee and work with management to assess and build on the strengths of our AIR MILES Reward Program and BrandLoyalty sustainability platforms, leveraging those strengths to develop a broader and more cohesive corporate strategy for Loyalty Ventures during 2022.

2021 ESG Highlights for Loyalty Ventures, the AIR MILES Reward Program and BrandLoyalty

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Board Committees

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The current membership and function of each standing committee is described below. Each committee operates under a written charter. Copies of these charters as well as our corporate governance guidelines and our Codes of Ethics for our senior financial officers, board of directors and employees are available on our website at https://www.loyaltyventures.com/corporate-governance/governance-overview. The committees may, when appropriate and in their discretion, delegate authority with respect to specific matters to one or more members. The committees report to the board of directors regularly, and will review and reassess the adequacy of their charters at least annually as well as conduct an annual evaluation of their performance.

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In connection with the spinoff, our board of directors was first appointed on November 4, 2021. During 2021, our board of directors met informally twice in advance of their appointment for informational and educational sessions about us and their upcoming duties and responsibilities and met formally one additional time following their appointment. The audit committee and compensation committees each met two times in 2021 and the corporate governance and nominating committee met once in 2021. Each of our directors attended at least 75% of the meetings of the board of directors and their respective standing committees. Our directors are expected to attend our annual stockholder meetings, including any virtual annual stockholder meeting. Our first annual meeting of stockholders will be held in a virtual format on May 26, 2022.

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Audit Committee	​
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Members: Graham W. Atkinson Richard A. Genovese Barbara L. Rayner	​ Chair: Barbara L. Rayner 2021 Meetings: 2 2021 Attendance: 100%

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Our board of directors has determined that each member of our audit committee meets the requirements for independence under Nasdaq’s current listing standards and SEC rules and regulations. In addition, the board of directors has determined that each member of our audit committee is financially literate, and further that Barbara L. Rayner is an “audit committee financial expert” as defined in Item 407(d)(5)(ii) of Regulation S-K under the Securities Act of 1934. This designation does not impose on such director any duties, obligations or liabilities that are greater than are generally imposed on members of our audit committee and our board of directors. Assuming stockholders re-elect our director nominee, our 2022 audit committee will continue with the current members and chair.

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The responsibilities of the audit committee are more fully described in our audit committee charter and include, among other duties:

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As discussed under the caption “Board Risk Oversight Function,” the audit committee oversees and evaluates the risk information provided by management, including with respect to any material financial and financial reporting risks as well as financial risks related to litigation or other legal, regulatory or compliance matters and technology, cybersecurity, physical security and data privacy matters.

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Compensation Committee	​
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Members: Graham W. Atkinson Roger H. Ballou Richard A. Genovese	​ Chair: Richard A. Genovese 2021 Meetings: 2 2021 Attendance: 100%

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Our board of directors has determined that each member of our compensation committee is a non-employee director, as defined by Rule 16b-3 promulgated under the Securities Exchange Act of 1934, and meets the requirements for independence under Nasdaq’s current listing standards and SEC rules and regulations. Our 2022 compensation committee will continue with the current members and chair. The compensation committee may delegate any of its responsibilities to one or more sub-committees comprised of one or more members of the compensation committee, provided such delegation is permitted under applicable laws, rules and regulations and any subcommittee consists of at least two members of the compensation committee who are non-employee directors.

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The responsibilities of our compensation committee are more fully described in our compensation committee charter and include, among other duties:

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Corporate Governance and Nominating Committee
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Members: Graham W. Atkinson Roger H. Ballou Barbara L. Rayner	​ Chair: Graham W. Atkinson 2021 Meetings: 1 2021 Attendance: 100%

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Our board of directors has determined that each member of our corporate governance and nominating committee meets the requirements for independence under Nasdaq’s current listing standards. Assuming the stockholders re-elect our director nominee, our 2022 corporate governance and nominating committee will continue with the current members and chair.

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The responsibilities of the corporate governance and nominating committee are more fully described in our corporate governance and nominating committee charter and include, among other duties:

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The corporate governance and nominating committee develops criteria for the selection of directors, including procedures for reviewing potential nominees proposed by stockholders. The corporate governance and nominating committee reviews with the board of directors the desired experience, mix of skills and other qualities, including diversity of race/ethnicity and gender, to assure appropriate composition of the board of directors, taking into account the current directors and the specific needs of our company and board of directors. The corporate governance and nominating committee also reviews and monitors the size and composition of the board of directors and its committees to ensure that the requisite number of directors are “independent directors” and “non-employee directors” within the meaning of rules, laws and listing standards applicable to us. For additional information on the role of the corporate governance and nominating committee with respect to the selection of directors, see “Director Selection Process.”

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Board Executive Sessions

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Our corporate governance guidelines provide that the non-management directors shall meet in executive session as a part of regularly scheduled board of director meetings, and the board of directors did so during 2021. In addition, each committee meeting may also conclude with an executive session at the election of the committee members. Further the board of directors or any committee may meet in executive session with select members of management, including our lead audit executive or representatives of our independent registered public accounting firm.

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Board Risk Oversight Function

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Management is responsible for the day-to-day handling of risks our company faces, implementing and supervising risk management processes and policies and reporting regularly to our board of directors and its committees, as appropriate. Our board of directors, as a whole and through its committees, maintains responsibility for the oversight of risk management. The audit committee has primary responsibility for overseeing our enterprise risk framework, evaluating the risk information provided by our management.

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While the audit committee has primary responsibility for oversight of enterprise risk management, the compensation

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and corporate governance and nominating committees also consider risks within their respective areas of responsibility. The audit committee maintains primary responsibility for oversight of the integrity of our financial statements, the qualification and independence of our independent registered public accounting firm, the performance of both the independent registered public accounting firm and our internal audit function, and other matters related to our financial reporting and accounting processes and controls.

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The compensation committee will review, at least annually, and take into account risks related to compensation matters to ensure the design of our compensation programs provide safeguards against (and do not promote) excessive or inappropriate risk-taking by program participants. The compensation committee’s responsibilities also include more specifically oversight of risks related to human capital management. The corporate governance and nominating committee considers and addresses governance matters that could impact our performance or reputation or that are of concern to stockholders, including, for example, board composition, corporate culture attributes and ESG and sustainability issues. For example, the corporate governance and nominating committee employs the same diversity considerations as those contemplated by the “Rooney Rule” in its review of potential director candidates; receives reports from and advises management regarding Loyalty Ventures’ sustainability and ESG strategies, policies and programs; seeks to assess and understand Loyalty Ventures’ corporate culture by reviewing ethics-related complaints received and investigated by our ethics office, if any; and promotes a positive culture by maintaining appropriate corporate governance guidelines, monitoring compliance with and enforcement of our Code of Ethics, and supporting our ethics-based approach to conducting business across the globe.

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Board Oversight of Information Security, Including Cybersecurity and Data Privacy

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Though Loyalty Ventures Inc.’s status as an independent, publicly-traded company just began in November 2021, protecting the privacy of our clients’ information and the security of our systems and networks has long been and will continue to be a priority at each of the component businesses of Loyalty Ventures. The board of directors is committed to maintaining strong and meaningful privacy and security protections across the company. The audit committee has primary responsibility for overseeing the company’s risk management program relating to privacy and cybersecurity. In this capacity, our board of directors and audit committee will receive periodic updates on both privacy and cybersecurity matters. These reports focus on, among other things, the evolving threat environment, vulnerability assessments, specific cyber incidents and management’s efforts to stay current and comply with applicable privacy regulations and monitor, detect and prevent cyber threats to our business.

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Data Privacy. We are committed to the responsible handling of personal information, and we balance our product development activities with a commitment to transparency, fairness and non-discrimination. We designed our multi-layered information security and data privacy programs and practices to ensure the secure and responsible use of the information and data our stakeholders entrust to us. Our programs leverage third-party assessments and advice regarding best practices from consultants, peer companies and advisors. We closely track proposed privacy legislative and regulatory changes and adjust the program as the privacy landscape evolves.

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Information Security, Including Cybersecurity. Our information security program, based upon the NIST Cybersecurity Framework, deploys a defense-in-depth strategy to ensure that security is an integral part of our technology investment. An essential component of our program is a regular cadence of tabletop exercises, employee training, testing employees through phishing simulations, and retraining when necessary. We maintain an active network of collaboration with law enforcement, industry groups, Information Sharing and Analysis Centers, and peers in the areas of threat intelligence, response and detection, and program best practices. We continuously assess the risks and threats and dynamically adjust our program and investments as required.

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Other Corporate Governance Policies and Procedures

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Term Limits; Mandatory Retirement. While we are in our first year, we have elected at this time not to have term limits for our board of directors as such limits may artificially cause the board to lose the contribution of one or more directors who have developed valuable institutional history and insight into our business. As an alternative to term limits, the board of directors, taking into consideration the recommendations of the corporate governance and nominating committee, will evaluate the qualifications and performance of each incumbent director before recommending the nomination of that director for an additional term. The mandatory retirement age from service on our board of directors is age 75; provided, however, that upon attaining the age of 75, a sitting director may continue to serve until the annual meeting of stockholders at which such director’s term is set to expire; and, provided further, that if the board of directors determines that it is in the best interests of Loyalty Ventures and its stockholders, the

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board of directors, taking into consideration the recommendations of the corporate governance and nominating committee, may nominate for re-election a director who has already attained the age of 75.

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Change in Status. When a director’s principal occupation or business association changes substantially during their tenure as a director, the director shall tender their resignation for consideration by the corporate governance and nominating committee. The corporate governance and nominating committee will recommend to our board of directors the action, if any, to be taken with respect to the resignation, which may be accepted, tabled or rejected.

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Policy Against Tax Gross Up Arrangements. Pursuant to our corporate governance guidelines, Loyalty Ventures will not enter into any contract, agreement or arrangement with an executive officer that obligates Loyalty Ventures to pay directly or reimburse such executive officer for any portion of the executive officer’s individual tax liability for benefits provided by Loyalty Ventures with the exception of any tax gross-up benefit provided pursuant to contracts, agreements, or arrangements assumed by Loyalty Ventures in connection with acquisitions or plans, policies, or arrangements applicable to Loyalty Ventures employees generally such as tax equalization programs for residence in multiple international jurisdictions.

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Alignment with Stockholders through Stock Ownership Guidelines. Directors and executive officers are expected to maintain at least a minimum position in our common stock so that their interests are aligned with those of our stockholders. The compensation committee adopted stock ownership guidelines in November 2021 and monitors compliance periodically. Our executive officers are required to maintain an investment position in our common stock equal to a multiple of their base salary. With compliance measured from the date of hire or promotion, the stock ownership guidelines include shares owned outright, vested but unexercised stock options and 70% of unvested time-based restricted stock units (50% for international executive officers with higher tax rates). Further, until compliance is achieved, executive officers must hold at least 50% of net shares acquired at vesting and are restricted from selling below the compliance threshold thereafter. While no period is provided to meet the threshold prior to measuring compliance, the board of directors expects executives to reach the prescribed thresholds within five years. Due to our recent spinoff, as of April 14, 2022, more than half of our executive officers have holdings that meet or exceed the guidelines while no executive officers have sold any shares of our common stock.

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Our directors are required to maintain an investment position in our common stock equal to five times their annual cash retainer, inclusive of all chair and committee retainers. Like executive officers, until compliance is achieved, directors must hold at least 50% of net shares acquired at vesting and are restricted from selling below the compliance threshold thereafter. Due to our recent spinoff, as of April 14, 2022, none of our non-employee directors have holdings that meet or exceed the guidelines and no directors have sold any shares of our common stock.

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Prohibitions on Hedging and Pledging of our Securities. Our insider trading policies prohibit directors, executive officers and employees, together with certain of their family members and controlled entities, from engaging in hedging transactions with respect to our securities. These prohibited transactions include the use of financial instruments, including prepaid variable forward contracts, equity swaps, collars and exchange funds, that are designed to hedge or offset any decrease in market value of such person’s holdings in our equity securities. Furthermore, our insider trading policies prohibit directors, executive officers and designated employees, together with certain of their family members and controlled entities, from (i) trading in puts, calls or other derivative securities; (ii) engaging in short sales with respect to our securities; (iii) holding our securities in a margin account; and (iv) pledging our securities as collateral for a loan. These policies help to ensure that the interests of our directors, executive officers and employees remain aligned with those of our other stockholders.

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Stakeholder Engagement. Our board of directors and management value our stakeholders’ opinions and feedback. In anticipation of and as a newly independent, publicly-traded company, Loyalty Ventures had a robust second half of 2021 conducting meaningful touchpoints with our stakeholders through ratings agency discussions, a virtual roadshow, analyst and investor calls, as well as client satisfaction surveys within the business segments and other channels of communication. We use the information and viewpoints gathered in our discussions to help inform our business and governance practices.

In 2022, we expect to continue our open dialogue with stakeholders. Further, we intend to identify ESG priorities; engage employees and external stakeholders to align on those priorities; seek to unify our segments’ sustainability

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reporting standards to strengthen our disclosure, as we work towards identification of key performance metrics and the ability to adopt goals for which targets can be established.

Stockholder or Other Communications with the Board. Stockholders and interested parties may send communications to our board of directors or any individual director by forwarding such communications to Loyalty Ventures’ corporate secretary. Communications should be addressed to Corporate Secretary, Loyalty Ventures Inc., 8235 Douglas Avenue, Suite 1200, Dallas, Texas 75225. All communications will be compiled by the office of the corporate secretary and submitted to the board of directors or individual directors on a periodic basis. The corporate secretary, however, reserves the right not to forward any abusive, threatening or otherwise inappropriate communications.  Stockholders and interested parties may also submit communications through our Ethics Office, including on an anonymous basis if desired, through our Ethics Helpline at (844) 951-5234 or online at www.loyaltyventures.ethicspoint.com. Concerns relating to accounting, internal control over financial reporting or auditing matters will be brought to the attention of the audit committee and handled in accordance with our procedures with respect to such matters.

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Code of Ethics. We have adopted codes of ethics that apply to our senior financial officers, board of directors and employees. The Loyalty Ventures Inc. Code of Ethics for Senior Financial Officers, the Code of Ethics for Board Members and the Code of Ethics for employees are posted on our website, found at https://www.loyaltyventures.com/corporate-governance/governance-overview. A copy of each is also available upon written request directed to Corporate Secretary, Loyalty Ventures Inc., 8235 Douglas Avenue, Suite 1200, Dallas, Texas 75225. We intend to satisfy the disclosure requirement under Item 5.05 of Form 8-K regarding an amendment to or waiver from a provision of our code of ethics, if any, by posting such information on our website.

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Identification, Qualification and Selection of Directors and Director Nominees

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Determination of Desired Nominee Qualifications. As a newly constituted board of directors, the corporate governance and nominating committee identifies nominees by first evaluating the current members of our board of directors willing to continue in service. The corporate governance and nominating committee developed and maintains a skills matrix based on our current operations and strategic plan to assist in the consideration of the appropriate balance of experience, skills and attributes required of a director and represented on the board of directors collectively. The corporate governance and nominating committee will evaluate candidates against the skills matrix when determining whether to recommend candidates for initial election to the board of directors and when determining whether to recommend currently serving directors for re-election. Current members of our board of directors with skills and experience that are relevant to our business and who are willing to continue in service are considered for re-nomination, balancing the value of continuity of service by existing members of our board of directors with that of obtaining relevant new skills, experience or perspective. In addition, Nasdaq’s new board diversity requirements and the inclusion in our corporate governance and nominating committee charter of the “Rooney Rule” concept—a commitment to include women and underrepresented minority candidates in every pool from which board nominees are chosen—means that our director nomination process will be fulsome and inclusive.

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Internal Identification of Director Nominees. The corporate governance and nominating committee has numerous methods, other than those proposed by our stockholders (discussed below) for identifying new candidates for possible inclusion in our recommended slate of director nominees. On a periodic basis, the corporate governance and nominating committee will solicit potential candidates from a number of sources—current members of our board of directors, individuals personally known to either our senior management or our current directors, and research, including subscription-based portal resources that contain search tools to identify specific skill sets, diversity and relationships of potential candidates to the company, members of management and current directors. Further, as a newly listed company, Nasdaq provides access to five platforms or resources to connect with diverse and qualified board candidates. The corporate governance and nominating committee may also utilize its authority under its charter to retain, at our expense, one or more third-party search firms to identify candidates. If the corporate governance and nominating committee retains one or more search firms, they may be asked to identify possible candidates who meet the minimum and desired qualifications, to interview and screen such candidates (including conducting appropriate background and reference checks), to act as a liaison among the board of directors, the corporate governance and nominating committee and each candidate during the screening and evaluation process, and thereafter to be available

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for consultation as needed. Regardless of the method by which new candidates are identified, every pool from which board nominees are chosen will include women and underrepresented minority candidates, consistent with our inclusion of the “Rooney Rule” concept in our governing documents.

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Identification of Director Nominees by Stockholders. In addition to the methods described above, any of our stockholders entitled to vote for the election of directors may nominate one or more persons for election to our board of directors at an annual meeting of stockholders if the stockholder complies with the nomination requirements set forth in our current bylaws and any applicable rules and regulations of the SEC. In accordance with Section 2.10 of our amended and restated bylaws, for consideration at our 2023 annual meeting, such nominations must be made by notice in writing and received by our Corporate Secretary no sooner than December 27, 2022 and no later than January 26, 2023. Such nominations will not be included in the proxy statement distributed by the board of directors. Nominations and recommendations should be addressed to: Corporate Secretary, Loyalty Ventures Inc., 8235 Douglas Avenue, Suite 1200, Dallas, Texas 75225.

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Evaluation of Candidates for Nomination to the Board of Directors. The corporate governance and nominating committee will consider all candidates identified through the processes described above, and will evaluate each of them, including incumbents, based on the same criteria. Once the corporate governance and nominating committee has identified a candidate, the committee makes an initial determination as to whether to conduct a full evaluation of the candidate. This initial determination is based on information provided to the corporate governance and nominating committee with the recommendation of the candidate, as well as the committee’s own knowledge of the candidate, which may be supplemented by inquiries to the person making the recommendation or others. The preliminary determination is based primarily on the need for additional board members to fill current or future vacancies or an expansion of the size of the board of directors and the likelihood that the candidate can satisfy the minimum and desired qualifications set forth in our corporate governance guidelines, as well as the applicable qualification requirements of Nasdaq and the SEC, an independence assessment and assessment against our skills matrix. There are no firm prerequisites to qualify as a candidate for our board of directors, but we seek a diverse group of candidates who possess the requisite background, knowledge, experience, expertise and time, as well as, diversity with respect to race/ethnicity and gender, that would strengthen and increase the diversity, skills and qualifications of the board of directors as set forth in our skills matrix. We seek director candidates who have the time to make a significant contribution to our board of directors, to our company, and to our stockholders. Each member of our board of directors is expected to ensure that other existing and planned future commitments do not materially interfere with their service as a director. Directors are expected to attend meetings of the board of directors and the committees on which they serve and to spend the time needed to prepare for meetings. If the corporate governance and nominating committee determines, in consultation with the board chair and other board members as appropriate, that additional consideration is warranted, it may request a third-party search firm to gather additional information about the candidate’s background and experience and to report its findings to the corporate governance and nominating committee.

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The corporate governance and nominating committee also considers such other relevant factors as it deems appropriate, including the current composition of the board of directors, the balance of management and independent directors and the need for audit committee or other particular expertise. In connection with this evaluation, the corporate governance and nominating committee determines whether to interview the candidate, and if warranted, one or more members of the corporate governance and nominating committee, and others as appropriate, will interview candidates in person or by videoconference or telephone. After completing this evaluation and interview, and the evaluations of other candidates, the corporate governance and nominating committee makes a recommendation to the full board of directors as to the persons who should be nominated, and the board of directors determines the nominees to recommend to our stockholders after considering the recommendation and report of the corporate governance and nominating committee and, in some cases, conducting additional interviews with such candidates.

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Director and Director Nominee Independence

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We adhere to the general standards for determination of director independence contained in the Nasdaq listing standards. For a director to be deemed independent, the board of directors must affirmatively determine that the director has no material relationship with us or our subsidiaries, affiliates or any member of our senior management or his or her affiliates. Our board of directors has reviewed and will annually review the independence of our non-employee directors and we will disclose the board’s determination in the proxy statement for each annual meeting of

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our stockholders. In making this determination, the board of directors considers relationships and transactions for up to the past three years between each director or any member of his or her immediate family, on the one hand, and our company, our subsidiaries, affiliates and senior management, on the other hand. For relationships not covered by certain bright-line criteria set forth in the Nasdaq listing standards, the determination of whether the relationship is material and, therefore, whether the director would be independent, is made by the board of directors. Directors have an affirmative obligation to inform the board of directors of any material changes in their circumstances or relationships that may impact their designation as “independent.” Additional independence requirements established by the SEC and Nasdaq apply to members of the audit committee and compensation committee, respectively.

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The board of directors undertook a review of director independence and considered transactions and relationships between each of the directors and director nominees and us (including our subsidiaries, affiliates and senior management). The audit committee and board of directors reviewed Ms. Rayner’s status as a contractor for Ernst & Young LLP. Loyalty Ventures engages in business transactions with Ernst & Young LLP. The payments made by Loyalty Ventures to Ernst & Young LLP following the Separation in November 2021 as well as those anticipated for 2022 fall below the Nasdaq independence standards’ thresholds of materiality for a director who is a current service provider for a company to which Loyalty Ventures made, or from which Loyalty Ventures received, payments, and Ms. Rayner had no direct or indirect material interest in those transactions and performed no work on matters for Loyalty Ventures. In addition, the audit committee and board of directors reviewed Mr. Ballou’s status as the chair of the board of directors of ADS. Pursuant to the IRS private letter ruling received in connection with our spinoff, or Separation, Mr. Ballou will serve as chair of our board of directors for a single three-year period ending in 2024. While Mr. Ballou will not be able to participate in decisions for either Loyalty Ventures or ADS with respect to any related party transactions (described further below), the board of directors determined that the relationship of Mr. Ballou with ADS, a significant stockholder of Loyalty Ventures, is not expected to interfere with his exercise of independent judgment in carrying out his responsibilities as a director for Loyalty Ventures. As a result of this review, the board of directors affirmatively determined that none of Atkinson, Ballou, Genovese or Rayner has a material relationship with us and, therefore, each is independent as defined by the rules and regulations of the SEC and Nasdaq’s listing standards.

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services have been provided during the 12-month period prior to the Distribution.

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Pursuant to the terms of the Tax Matters Agreement, ADS will be responsible for all pre-Distribution tax payables and tax reserves but will also be entitled to receive all pre-Distribution tax receivables when realized. As of December 31, 2021, the amounts due to and due from ADS related to the tax matters agreement were $81.0 million and $20.1 million, respectively. Pursuant to the terms of the Transition Services Agreement, during 2021 we incurred approximately $0.5 million in general and administrative expenses that were offset by certain de minimis amounts owed by ADS for services provided to ADS. Other than the agreements with ADS listed above, since Loyalty Ventures’ inception in 2021, we have not entered into any transactions, nor are there any proposed transactions, in which Loyalty Ventures was, or is to be, a participant and in which any related person had, or is expected to have, a direct or indirect material interest.

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Our board of directors has adopted a written related party transactions policy, which prohibits us from entering into any “related party transaction” unless the audit committee approves such transaction in accordance with the guidelines set forth in the policy, or the transaction is approved by a majority of disinterested directors of the company. In approving any related party transaction, the audit committee must determine that the transaction is beneficial to Loyalty Ventures and the terms of the related party transaction are fair to us.

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For purposes of our related party transactions policy, a “related party” is: (1) any director, director nominee or executive officer of the company; (2) any five percent or greater stockholder of the company; or (3) any immediate family member of any of these persons. A “related party transaction” includes any transaction (including any financial transaction, arrangement or relationship (including any indebtedness or guarantee of indebtedness)), or series of related transactions, or any material amendment to any such transaction, in which the company, or any of its subsidiaries, is a participant, the aggregate amount of which exceeds $120,000 and in which the related party has or will have a direct or indirect material interest (other than solely as a result of being a director or a less than 10 percent beneficial owner of another entity). Our related party transactions policy deems the following transactions to be pre-approved and does not require further review: (1) compensation of directors that has been approved in accordance with the compensation committee charter; (2) employment and compensation of an executive officer that has been approved in accordance with the compensation committee charter; (3) a transaction in which the interest of the related party arises solely from the ownership of a class of the company’s equity securities and all holders of that class receive the same benefit on a pro rata basis; (4) transactions involving certain indemnification payments and payments under directors and officers liability insurance policies; (5) a transaction in which the rates or charges involved therein are determined by competitive bids; (6) a transaction that involves services as a bank depositary of funds, transfer agent, registrar, trustee under a trust indenture, or similar services; and (7) certain company charitable contributions.

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At each audit committee meeting, management shall recommend any related party transactions, if applicable, to be entered into by the company. After review, the audit committee shall approve or disapprove such transactions and at each subsequently scheduled meeting, management shall update the audit committee as to any material change to those approved transactions. The audit committee shall establish such guidelines as it determines are necessary or appropriate for management to follow in its dealings with related parties in related party transactions.

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All related party transactions of which management is aware are required to be disclosed to the audit committee. If management becomes aware of an existing related party transaction that has not been pre-approved by the audit

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committee, management is required to promptly notify the chair of the audit committee and such transactions shall be submitted to the audit committee for its review and determination of whether to ratify such transaction. If management, in consultation with our chief executive officer or chief financial officer, determines that it is not practicable to wait until the next audit committee meeting, the chair of the audit committee has the delegated authority during the period between audit committee meetings, to review and determine whether any such transaction should be approved, or ratified, as the case may be. The chair of the audit committee shall report to the audit committee any transactions reviewed by them pursuant to this delegated authority at the next audit committee meeting.

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skills matrix AND DESCRIPTION OF DIRECTOR KNOWLEDGE, SKILLS AND EXPERIENCE

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The matrix below provides information regarding our director and director nominees’ knowledge, skills and experience that are most relevant in light of our company’s business, long-term strategies and risks. Additional description regarding each of these categories is available in the key following this matrix. The fact that a director is not designated as having a particular attribute does not indicate that the director does not possess that attribute or would not be able to make a meaningful contribution to the board’s decision-making or oversight in that area. Demographic information regarding our directors is also included in the matrix.

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Director Biographies

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Executive Officer Biographies (Other than President & Chief Executive Officer, see above)

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COMPONENTS OF All Other Compensation FOR Fiscal Year 2021

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OtHER PLANS OR AGREEMENTS GOVERNING EXECUTIVE AND DIRECTOR COMPENSATION

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2021 Omnibus Incentive Plan. In connection with the Separation, Loyalty Ventures and its sole stockholder adopted and approved the 2021 Omnibus Incentive Plan. The 2021 Omnibus Incentive Plan is intended to advance our interests and the interests of its stockholders by providing a means to attract, retain and reward certain employees and other key service providers and to enable such individuals to acquire or increase a proprietary interest in us, thereby promoting a closer identity of interest between such individuals and our stockholders. The 2021 Omnibus Incentive Plan provides for grants of incentive and non-equity qualified stock options, stock appreciation rights, restricted share awards and performance awards, restricted stock units, performance awards and cash incentive awards, cash-based awards and other share-based awards. The 2021 Omnibus Incentive Plan is administered by the compensation committee and any officers, employees, directors or consultants performing services for us or our affiliates who are selected by the compensation committee may participate in the 2021 Omnibus Incentive Plan, but only employees will be eligible to receive incentive stock options.

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Change in Control—Impact on Outstanding Equity. Under our 2021 Omnibus Incentive Plan, the compensation committee, as the plan administrator, may accelerate vesting of outstanding equity or other plan awards, including restricted stock units, in the event of a change in control. Further, if a participant’s employment or other service is terminated by the company or other surviving entity without cause or the participant resigns for good reason within 12 months after a change in control, all restrictions on any awards held by the participant will lapse and the awards will be immediately and fully vested. Further, stock options will be exercisable until the earlier of the end of the option term or the end of the one-year period following such event.

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Loyalty Ventures Inc. Pre-Approved Defined Contribution Plan (Profit Sharing/401(k) Plan). The Loyalty Ventures Inc. Pre-Approved Defined Contribution Plan (Profit Sharing/401(k) Plan) is a defined contribution plan that is qualified under IRC Section 401(k). Eligible employees can participate in the 401(k) plan immediately upon joining the company and after 180 days of employment begin receiving company matching contributions. The 401(k) plan covers eligible U.S. employees. Loyalty Ventures matches dollar-for-dollar up to six percent of an employee’s eligible compensation. All matching contributions are immediately vested.

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Indemnification Agreements. We have entered into indemnification agreements with each of our NEOs and non-employee directors so that they may serve the company without undue concern for their protection in connection with their services. These agreements provide that we indemnify such persons against certain liabilities that may arise by reason of their status or service as an officer or director, to advance their expenses incurred as a result of a proceeding as to which they may be indemnified and to cover such persons under any directors’ and officers’ liability insurance policy that we may choose to maintain. These indemnification agreements are intended to provide indemnification rights to the fullest extent permitted by Delaware law and are in addition to any other rights the indemnitee may have under our amended and restated certificate of incorporation, amended and restated bylaws and applicable law.

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Employee Matters Agreement, as amended. In connection with the Separation, we entered into an Employee Matters Agreement with ADS that governs each company’s respective compensation and benefit obligations with respect to current and former employees, directors and consultants, including with respect to the forfeiture and replacement of ADS equity grants held by employees included in the spinoff.

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Employee Covenants Agreement. We have entered into employee covenants agreements with each of our U.S.-based employees, including Mr. Horn. The agreement provides for the protection of the confidential information of Loyalty Ventures; assignment to Loyalty Ventures of any intellectual property developed as an employee of Loyalty Ventures; an agreement not to solicit Loyalty Ventures customers or other Loyalty Ventures employees for a period of one year after leaving Loyalty Ventures; an agreement not to interfere with vendors and suppliers of Loyalty Ventures for a period of one year after leaving Loyalty Ventures; and agreement to not directly provide services to a Loyalty Ventures customer on behalf of a competitor for a period of one year after leaving Loyalty Ventures; to return all Loyalty Ventures property and confidential information upon termination of employment; to avoid conflicts of interest while employed by Loyalty Ventures; and to (for VP’s and above only) provide a minimum 90 days notice (compensated) of any decision to voluntarily terminate employment with Loyalty Ventures, to provide for transition of responsibilities.

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Employment agreements. BrandLoyalty has entered into an employment agreement and an addendum to the employment agreement with Ms. Mennen, which is customary for employees in the Netherlands. The employment agreement and addendum with Ms. Mennen provide that she is entitled to receive an annual base salary and a holiday allowance equal to 8% of her base salary. Pursuant to the employment agreement, Ms. Mennen is eligible to participate in the Loyalty Ventures long-term incentive plan and receive an annual equity award with a value of $850,000, subject to her continued employment on the grant date. The employment agreement with Ms. Mennen also provides that each year a new, individual bonus agreement will be provided, consisting of company and personal performance targets. Ms. Mennen is also entitled to a car lease based on BrandLoyalty’s Car Policy. If Ms. Mennen’s employment is terminated at the initiative of the company (provided that such termination is not caused by an act or omission of Ms. Mennen that can be qualified as a negligent or culpable act or behavior), then she will be entitled to receive a severance payment in the gross amount of 100% of her base salary (including her holiday allowance), as well as a pro rata bonus based on actual performance of the financial targets set at the beginning of the applicable year. In connection with her employment agreement addendum, Ms. Mennen is subject to the following restrictive covenants: during employment and for one year thereafter, Ms. Mennen may not (i) compete with any person, institution, company or business which undertakes activities which compete with those of BrandLoyalty and/or its affiliates; (ii) maintain business contacts, directly or indirectly, with clients or potential clients with whom BrandLoyalty was in contact with during the last year of Ms. Mennen’s employment; and (iii) induce employees or persons who, in the period of a year prior to Ms. Mennen’s termination, are or have been employed by BrandLoyalty and/or its affiliates.

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Group retirement savings plan and deferred profit sharing plan (AIR MILES Reward Program). We maintain the Group Retirement Savings Plan of the Loyalty Group, or GRSP, which is a group retirement savings plan registered with the Canada Revenue Agency. Contributions made by Canadian employees on their behalf or on behalf of their spouse to the GRSP, and income earned on these contributions, are not taxable to employees until withdrawn from the GRSP. Employee contributions eligible for company match may not exceed the overall maximum allowed by the Income Tax Act (Canada); the maximum tax-deductible GRSP contribution is set by the Canada Revenue Agency each year. Eligible full-time employees can participate in the GRSP after three months of employment and eligible part-time employees after six months of employment. We also maintain the Deferred Profit Sharing Plan, or DPSP, which is a legal trust registered with the Canada Revenue Agency. Employees become eligible to receive company matching contributions into the DPSP on the first day of the calendar quarter following twelve months of employment. Based on the eligibility guidelines, the Company matches an employee’s contribution dollar-for-dollar up to five percent of the employee’s eligible compensation. Contributions made to the DPSP reduce an employee’s maximum contribution amounts to the GRSP under the Income Tax Act (Canada) for the following year. All company matching contributions into the DPSP vest after receipt of one continuous year of DPSP contributions.

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Canadian supplemental executive retirement plan. We maintain the Canadian Supplemental Executive Retirement Plan, which allows for a defined group of management and highly compensated employees of LoyaltyOne, Co. to defer on a pre-tax basis a portion of their compensation and bonuses payable for services rendered and to receive certain employer contributions.

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Compensation practices

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Following certain significant corporate events, unusual and non-recurring corporate events or changes in applicable laws, regulations or accounting principles, the compensation committee has the authority, subject to certain restrictions set forth in the 2021 Omnibus Incentive Plan to waive performance conditions relating to an award and to make adjustments to any award that the compensation committee feels are appropriate. Further, the compensation committee may reduce payout amounts under performance-based awards if, in the discretion of the compensation committee, such a reduction is appropriate. The compensation committee may not, however, increase the payout amount for any such performance-based award. In addition, this plan does not permit stock options to be “repriced” at a lower exercise price, or otherwise modified or amended in such a manner that would constitute a “repricing.”

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establishing THE Proxy PEER group

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Following the ADS board’s determination to spin off its LoyaltyOne segment in May 2021, ADS’ senior management team engaged compensation consultants from the Lockton-Dunning Series of Lockton Companies, LLC to establish a proxy peer group and perform an executive and director compensation analysis for Loyalty Ventures Inc. to ensure competitive pay levels were established. Since Loyalty Ventures has limited market peers, Lockton undertook a thorough review of companies in the sub-industry GICS code to which management expected Loyalty Ventures to be assigned and those most similar. Lockton further filtered the potential proxy peers based on revenue and market cap considerations, and from a pool of nearly 100 companies recommended the following 14 peer companies that were selected by the ADS compensation committee.

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