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What changed in Origin Materials, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Origin Materials, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+418 added−412 removedSource: 10-K (2025-03-13) vs 10-K (2024-03-05)

Top changes in Origin Materials, Inc.'s 2024 10-K

418 paragraphs added · 412 removed · 272 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

44 edited+39 added−90 removed11 unchanged
Biggest changeCMF is a chemically flexible intermediate that can be converted into a variety of products, including paraxylene (“PX”), that can “drop in” to current supply chains to produce purified terephthalic acid (“PTA”), and subsequently polyethylene terephthalate (“PET”). Alternatively, CMF can be used to produce furandicarboxylic acid (“FDCA”), which can be converted into polyethylene furanoate (“PEF”).
Biggest changeApplications include paraxylene (“PX”), which is a precursor to purified terephthalic acid (“PTA”) and subsequently PET; furandicarboxylic acid (“FDCA”), which can be converted into polyethylene furanoate (“PEF”). CMF target markets include food and beverage packaging, apparel, carpet fibers, adhesives, coatings and plasticizers. HTC is a diverse, high-potential material. Current applications of our HTC include a drop-in, energy-dense solid fuel.
Pursuant to the terms of the Merger Agreement, Artius effected a business combination with Legacy Origin through the merger of Merger Sub with and into Legacy Origin, with Legacy Origin surviving as the surviving company and as our wholly-owned subsidiary.
Pursuant to the terms of the Merger Agreement, Artius effected a business combination with Legacy Origin through the merger of Merger Sub with and into Legacy Origin, with Legacy Origin as the surviving company and as our wholly-owned subsidiary.
On June 25, 2021, we consummated a merger pursuant to that certain Agreement and Plan of Merger and Reorganization, dated as of February 16, 2021 (as amended by the letter agreement dated March 5, 2021, the “Merger Agreement”), by and among Artius, Zero Carbon Merger Sub Inc., a Delaware corporation and a direct, wholly owned subsidiary of Artius (the “Merger Sub”), and Micromidas, Inc., a Delaware corporation doing business as Origin Materials (“Legacy Origin”).
On June 25, 2021, we consummated a merger pursuant to that certain Agreement and Plan of Merger and Reorganization, dated as of February 16, 2021 (as amended by the letter agreement dated March 5, 2021, the “Merger Agreement”), by and among Artius, Zero Carbon Merger Sub Inc., a Delaware corporation and a direct, wholly owned subsidiary of Artius (the “Merger Sub”), and Micromidas, Inc., a Delaware 11 corporation doing business as Origin Materials (“Legacy Origin”).
Many of our products are drop-in replacements for traditional petrochemicals, enabling our customers to use our products in their existing manufacturing processes to produce chemically and physically identical end products with little to no change in customer behavior. 7 • Abundant, low-cost and historically price-stable feedstock.
Many of our products are drop-in replacements for traditional petrochemicals, enabling customers to use our products in their existing manufacturing processes to produce chemically and physically identical end products with little to no change in customer behavior. • Abundant, low-cost and historically price-stable feedstock.
Several states like California, Maine, and New Jersey, as well as Canada and the European Union, have enacted or are considering “minimum recycled content” regulations mandating certain minimum post-consumer recycled content in certain types of packaging, including, specifically, plastic beverage containers.
Regulatory Several states like California, Maine, and New Jersey, as well as Canada and the European Union, have enacted or are considering “minimum recycled content” regulations mandating certain minimum post-consumer recycled content in certain types of packaging, including, specifically, plastic beverage containers.
Our biomass conversion technology can use timber and forest residues such as pine pulpwood, which is currently abundant and renewable, as its base-case feedstock. The feedstock for the pulp industry in North America is plentiful and the cost has historically been relatively low and stable compared with the cost of oil.
Our furanics technology can use timber and forest residues such as pine pulpwood, which is currently abundant and renewable, as its base-case 6 feedstock. The feedstock for the pulp industry in North America is plentiful and the cost has historically been relatively low and stable compared with the cost of oil.
We were formerly known as Artius Acquisition Inc. (“Artius”). Artius was originally registered under the Companies Law of the Cayman Islands on January 24, 2020, as a special purpose acquisition company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or other similar business combination with one or more target businesses.
Artius was originally registered under the Companies Law of the Cayman Islands on January 24, 2020, as a special purpose acquisition company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or other similar business combination with one or more target businesses.
As we advance and scale up our biomass conversion technology and other application development, we expect to introduce manufacturing capacity, which may include acquiring production lines or construction of chemical plants, that can produce sustainable materials and product applications.
As we advance and scale up our PET closures business, furanics technology, and other application development, we expect to introduce manufacturing capacity, which may include acquiring production lines or construction of chemical plants, that can produce sustainable materials and product applications.
Our biomass conversion technology can enable companies to lower their overall CO2 emissions and meet their emissions reduction commitments by substituting decarbonizing Furanic Intermediates and their derivatives for all or a portion of the fossil-based content of materials like PET in their supply chains.
Our furanics technology can enable companies to lower their overall CO 2 emissions and meet their emissions reduction commitments by substituting decarbonizing Furanic Intermediates and their derivatives for all or a portion of the fossil-based content of materials in their supply chains.
Our process was designed to be able to take advantage of idled and aging pulp mills and may be co-located with such mills to secure access to existing site-specific feedstock supplies and skilled labor while lowering required capital investment.
Our process was designed to be able to take advantage of idled and aging pulp mills and may be co-located with such mills to secure access to existing site-specific feedstock supplies and skilled labor while lowering required capital investment. Research and Development Research and development is important to the success of our closures business.
We believe our competitors now significantly lag behind us and will be unable to replicate the efficiency, yield and quality of our process, as we expect to continue to improve our existing technology and processes. • Proprietary Packaging Solutions for Improved Recycling and Performance.
We believe our competitors now significantly lag behind us and will be unable to replicate the efficiency, yield and quality of our process, as we expect to continue to improve our existing technology and processes.
Competitive Landscape We expect our products to compete with traditional, petroleum-based materials currently used in Origin’s target markets, as well as compete with alternatives to these materials that both established and new companies seek to produce. In our near-term markets, we expect to compete with global oil and petrochemical companies and large international diversified chemical companies.
For our furanics technologies and biomass conversion platform, we expect our products to compete with traditional, petroleum-based materials currently used in our target markets, as well as compete with alternatives to these materials that both established and new companies seek to produce. We expect to compete with global oil and petrochemical companies and large international diversified chemical companies.
We also have three pending design patent application in the United States, Trade secrets. We maintain a secure digital vault of our trade secrets with heightened confidentiality protections. Access to this vault is limited to a select group and is granted on a need-to-know basis.
We maintain a secure digital vault of our trade secrets with heightened confidentiality protections. Access to this vault is limited to a select group and is granted on a need-to-know basis.
Further, the information in the vault is left strategically incomplete and requires corroboration from referenced internal documents to ensure that the entirety of any trade secret is known only by someone who has access to each such document.
Further, the information in the vault is left strategically incomplete and requires corroboration from referenced internal documents to ensure that the entirety of any trade secret is known only by someone who has access to each such document. Our employees are required to participate in invention assignment and non-disclosure protocols to further ensure the protection of our trade secrets. Know-how.
Environmental Protection Agency (the EPA), the Canadian Environmental Protection Act (CEPA) administered by Health Canada and Environment and Climate Change Canada, and the European Union’s regulation entitled the Registration, Evaluation, Authorization and Restriction of Chemicals (REACH). Our production processes are subject to regulations and permit requirements relating to air emissions, wastewater discharges, waste generation and disposal and other environmental matters.
Environmental Protection Agency (the "EPA") and the Canadian Environmental Protection Act ("CEPA") administered by Health Canada and Environment and Climate Change Canada. Our production processes are subject to regulations and permit requirements relating to air emissions, wastewater discharges, waste generation and disposal, and other environmental matters. Employees and Workplace Culture Intentional Culture and Leadership.
We believe our products can help enable prospective customers to achieve their net zero carbon emissions commitments by transitioning away from fossil-based materials towards materials made with our biomass conversion technology, which can use sustainable, non-food, plant-based feedstock. • High Barriers to Entry.
We believe our products can help enable prospective customers to achieve their net zero carbon emissions commitments by transitioning away from fossil-based materials towards materials made with our furanics technology, which can use sustainable, non-food, plant-based feedstock. • High Barriers to Entry. Over more than a decade, we have generated a robust patent portfolio as well as critical trade secrets.
Our Biomass Conversion Technology We have developed a proprietary biomass conversion technology to convert biomass, or plant-based carbon, into the versatile “building block” chemicals chloromethylfurfural (“CMF”) and hydrothermal carbon (“HTC”), which we collectively refer to as Furanic Intermediates, as well as other oils and extractives and other co-products.
These include our proprietary technology for transforming biomass, or plant-based carbon, into versatile intermediate chemicals. These intermediate chemicals include chloromethylfurfural ("CMF") and hydrothermal carbon (“HTC”), which we collectively refer to as Furanic Intermediates, as well as oils and extractives and other co-products.
Our biomass conversion technology produces versatile chemical “building blocks” that we anticipate, in the long term, can be converted into products to replace a broad range of chemicals and materials representing an addressable market that we believe is more than $750 billion. These markets include paints, coatings, soil additives, advanced polyesters, epoxies, plasticizers, polyurethanes, elastomers, emulsions and solvents.
Our furanics technology produces versatile chemical “building blocks” that we anticipate, in the long term, can be converted into products to replace a broad range of chemicals and materials representing an addressable market that we believe is more than $1 trillion.
We are deliberate, open, and transparent about our dedication to our core purpose; to enable the world’s transition to sustainable materials as the leading carbon negative materials company. We have assembled an exceptional team of scientists, engineers, and business leaders to develop and execute our strategic plans. Diversity, Equity & Inclusion.
At Origin, our values inform our decision making and how we act. We are deliberate, open, and transparent about our dedication to our core purpose; to enable the world’s transition to sustainable materials. We have assembled an exceptional team of operations specialists, scientists, engineers, and business leaders to develop and execute our strategic plans. Human Capital.
In the United States, a patent’s term may, in certain cases, be lengthened by patent term adjustment, which compensates a patent holder for administrative delays by the United States Patent and Trademark Office in examining and granting a patent or may be shortened if a patent is terminally disclaimed over a commonly owned patent or a patent naming a common inventor and having an earlier expiration date.
In the United States, a patent’s term may, in certain cases, be lengthened by patent term adjustment, which compensates a patent holder for administrative delays by the United States Patent and Trademark Office ("USPTO") in examining and granting a patent.
Raw Materials Supply Our biomass conversion technology can produce building block chemicals from a variety of abundant, low-cost bio-feedstocks including wood residues and wood processing waste.
We believe we will be able to source materials as needed to manufacture closures. Our furanics technology can produce building block chemicals from a variety of abundant, low-cost bio-feedstocks including wood residues and wood processing waste.
These competitors include electric vehicles, renewable power generation, and food technology. While we do not anticipate competing directly for market share with producers of these technologies, we expect to compete for wallet share from customers looking to reduce overall carbon emissions throughout their supply chain and operations.
While we do not anticipate competing directly for market share with producers of these technologies, we expect to compete for wallet share from customers looking to reduce overall carbon emissions throughout their supply chain and operations. Our Competitive Strengths We believe that our PET closure technology and products offer a breakthrough in performance and sustainability for packaging.
The chemicals and intermediates that we manufacture and use, including CMF and HTC, require (or as the products are further commercialized are anticipated to require) authorization or exemptions under the Toxic Substances Control Act (TSCA) administered by the U.S.
The production and sale of our chemicals and intermediates that we manufacture and use, including CMF and HTC, and our ongoing research and development activities require authorizations or exemptions under the Toxic Substances Control Act ("TSCA") administered by the U.S.
We have also developed other products that can enhance sustainability, such as our 100% PET circular caps and closures that can enable fully-recyclable PET containers and reduce waste through light-weighting, while providing enhanced performance such as greater oxygen and CO2 barrier properties that can increase shelf-life. These products complement our biomass conversion technology.
Our PET closures enable fully-recyclable PET beverage containers and reduce waste through light-weighting, while providing enhanced performance such as greater oxygen and CO 2 barrier properties that can increase shelf-life.
We expect to then use a portion of those profits to fund the further development of our biomass conversion technology and the requisite manufacturing capacity. Operation of Origin 1 and development of Origin 2: • Origin 1 is a strategic asset which we plan to use to qualify higher-value applications for our intermediates CMF and HTC.
Development of furanics technology and biomass conversion platform for long-term revenue generation: • Origin 1 is a strategic asset which we plan to use to qualify higher-value applications for our intermediates CMF and HTC.
Origin intends to retain exclusive rights to commercially work its biomass to CMF and HTC pathways. We also rely on trade secrets, know-how and continuing technological innovation to develop and maintain our proprietary position. Patents. As of February 8, 2024, we own 27 U.S. utility patents, 16 foreign patents, 7 pending U.S. non-provisional applications, and 10 pending international applications.
We intend to retain exclusive rights to commercially work its biomass to CMF and HTC pathways. We also rely on trade secrets, know-how and continuing technological innovation to develop and maintain our proprietary position. Patents. As of March 1, 2025, the issued patents in our portfolio are broken down as follows: Issued U.S.
Origin's all-PET caps offer improved performance compared with incumbent caps, enabling lighter cap weight and improved product shelf life. Business Strategy Our goal is to build a commercially successful business that can scale and meet current and future expected demand for carbon negative materials.
Business Strategy Our goal is to build a commercially successful business that can scale and meet current and future expected demand for sustainable and performance enhanced materials.
These regulations may present new opportunities for sustainable products like our all-PET caps and closures, which can be made from recycled PET and be recycled together with the PET containers on which they are used. Employees and Human Capital Resources Intentional Culture and Leadership. At Origin, our values inform our decision making and how we act.
These regulations may present new opportunities for sustainable products like our PET closures, which can be made from recycled PET and be recycled together with the PET containers on which they are used. PET closures may involve food contact and will be regulated by the U.S.
Item 1. Business Overview Origin is an innovative materials company with a mission to enable the world’s transition to sustainable materials.
Item 1. Business Overview Origin is a technology company with a mission to enable the world’s transition to sustainable materials. Our innovations include PET closures for an estimated global closures market opportunity of greater than $65 billion.
In the caps and closures market, we anticipate potential competition from other cap producers in the supply chain. At the same time, we believe there are opportunities for cooperation with these businesses to help commercialize and increase adoption of our all-PET caps and closures.
Apart from competition, we believe there are opportunities for cooperation with incumbent cap producers who could help commercialize and increase adoption of our PET closures.
Key elements of our strategy include: Near-term revenue generation: • We are focusing our available human and cash resources on developing near-term, recurring revenues through high value products like our all-PET caps and closures.
We also expect to continue to develop new materials and product applications, together with our partners, to maintain and increase our competitive advantages. Key elements of our strategy include: Near-term revenue generation through the sale of PET closures: • We are focusing our available human and cash resources on developing near-term, recurring revenues through our PET closures.
Finally, we have forty pending international applications directed to closures for containers including one pending utility patent application with the Patent Cooperative Treaty, and three pending design applications each in Australia, Brazil, Canada, China, Europe, India, Japan, Mexico, Saudi Arabia, South Korea, Taiwan, Turkey, and the United Kingdom that would expire in 2038.
We have 26 issued design patents in foreign jurisdictions including Australia, Brazil, Canada, the United Kingdom, India, Korea, Turkey, and Taiwan that will expire between 2039 and 2049. 10 Finally, we have 60 pending international applications directed to our closures technology in foreign jurisdictions including ARIPO, Australia, Brazil, Canada, China, Europe, India, Israel, Japan, Mexico, Saudi Arabia, South Africa, Taiwan, the United Kingdom, Trade secrets.
None of our employees is subject to a collective bargaining agreement and we believe we have a good relationship with our employees. Corporate Information Artius Acquisition Inc. (“Artius”) incorporated in the Cayman Islands on January 24, 2020. Legacy Origin was incorporated in 2008 as a Delaware corporation.
As of December 31, 2024, we had approximately 82 employees located in the United States and 27 employees in Canada, all of whom were full-time employees. None of our employees is subject to a collective bargaining agreement and we believe we have a good relationship with our employees. Corporate Information Origin was formerly known as Artius Acquisition Inc. (“Artius”).
Source: Press search and company websites. As previously reported on a Rule 425 filing of Artius Acquisition, Inc. dated April 19, 2021. Our Addressable Market According to the International Energy Agency, the chemical sector is the largest industrial consumer of both oil and gas. Currently, organic chemicals are predominantly derived from fossil sources such as petroleum.
According to the International Energy Agency, the chemical sector is the largest industrial consumer of both oil and gas. Currently, organic chemicals are predominantly derived from fossil sources such as petroleum. These chemicals are used to produce a wide array of materials from paints to plastics, space suits to solar panels, and from medicines to electronics.
Our current strategy for carrying out that development work and constructing Origin 2 depends on near-term revenue from products like our all-PET caps and closures and our ability to secure substantial financial support from strategic partners.
Our current strategy for carrying out development work and technology scale-up beyond Origin 1 depends on near-term revenue from products like our PET closures and our ability to secure substantial financial support from strategic partners. 8 Raw Materials Supply The Origin CapFormer System can produce PET closures from any type of PET, whether virgin PET, rPET, bio-based PET, or blends of these, depending on customer preference.
Origin’s near-term and long-term addressable markets together exceed $1.0 trillion. $65+ billion immediate opportunity - We expect our all-PET caps to begin to address a greater than $65 billion global caps and closures market. $390+ billion near-term market focus. We believe our technology can serve near-term markets representing an aggregate market opportunity that we believe is over $390 billion.
We expect our PET closures to begin to address a greater than $65 billion global closures market. • Approximately $1 trillion+ long-term market opportunity.
We operate an in-house laboratory and pilot-scale manufacturing facilities in West Sacramento, California and Sarnia, Ontario, Canada to conduct research and development work. Using its versatile biomass conversion technology, Origin has been developing commercialization pathways for higher-value applications for its intermediates CMF and HTC such as FDCA and carbon black, respectively.
For our furanics technologies, including our biomass conversion platform, and related intermediates, we have been developing commercialization pathways focused on high-value applications. We operate an in-house laboratory and pilot-scale manufacturing facilities in West Sacramento, California and Sarnia, Ontario. Our furanics development work has a characteristically longer development cycle than our closures R&D.
Our competitive strengths related to that technology. and to other Origin technologies, include: • Flexible platform enables drop-in solutions serving a large addressable market. We believe that our biomass conversion technology is well-positioned to address a substantial global market that is just beginning to transition from petroleum-based materials to sustainable materials.
We believe that our furanics technology is capable of helping to address a substantial global market that is just beginning to transition from petroleum-based materials to sustainable materials.
We also own 3 pending U.S. design applications and 39 pending international design applications. The term of individual patents depends upon the legal term of the patents in countries in which they are obtained.
Utility Patents Furanics Closures 28 0 Issued Foreign Utility Patents Furanics Closures 22 0 Issued Foreign Design Patents Furanics Closures 0 28 The term of individual patents depends upon the legal term of the patents in countries in which they are obtained.
Applications for CMF produced at Origin 2 are expected to include the FDCA-based polymers PEF and PETF for advanced packaging, textiles, and other potential applications. As of December 31, 2023, Origin 2 remains in the project development stage.
Origin 1 commenced commercial-scale production in October 2023. • Future Origin biomass conversion plants are expected to focus on supplying products that serve our markets of interest. CMF applications could include the FDCA-based polymers PEF and PETF for advanced packaging, textiles, and other potential applications.
We believe that products made using Origin’s biomass conversion technology at commercial scales will be able to compete directly with petroleum-derived products on both performance and price while being sustainable.
We believe that products made using our furanics technology at sufficient scale and maturity can compete directly with petroleum-derived products on both performance and price while being sustainable and lowering the carbon footprint. CMF is a chemically flexible intermediate that can be converted into a variety of products, including numerous commodity and specialty chemicals.
Current applications of our HTC include a drop-in, energy-dense solid fuel. HTC can also be calcined to produce a carbon-negative activated carbon for food and water treatment and filtration. Our HTC product development pipeline includes carbon black replacement for tires, foams and dyes, paint and coating applications, and agriculture and soil products.
Our HTC product development pipeline includes carbon black replacement for tires, foams and dyes, paint and coating applications, and agriculture and soil products. Further, we believe oils and extractives could be used to produce cellulose-derived, low carbon intensity biofuels for transportation and marine fuel, industrial applications, and heat and power generation.
In our long-term focus markets, we expect to face competition from, among others, incumbents that include large chemical companies that continue to rely on petroleum-based feedstocks in their production processes. Given our leading position in decarbonized materials, we also expect to compete with alternative technologies targeting different sources of emissions.
Given our leading position in decarbonized materials, we also expect to compete with alternative technologies targeting different sources of emissions. These competitors include electric vehicles, renewable power generation, and food technology.
We have pioneered a technology that has the potential to replace petroleum-based materials with decarbonized materials in a wide range of end products, such as food and beverage packaging, clothing, textiles, plastics, car parts, carpeting, tires, adhesives, soil amendments, fuels, and more.
Our furanics technologies include our furanics platform for transforming carbon into sustainable materials for a wide range of end products capable of addressing an estimated $1 trillion market opportunity, including food and beverage packaging, clothing, textiles, plastics, car parts, carpeting, tires, adhesives, soil amendments, and fuels.
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We believe that our biomass conversion technology can help make the world’s transition to “net zero” possible and support the fulfillment of greenhouse gas reduction pledges made by countries as part of the United Nations Paris Agreement as well as corporations that are committed to reducing emissions in their supply chains.
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Our Products and Technologies PET Closures Technology Platform Our PET closures and technologies for producing them reflect our mission to enable the world's transition to sustainable materials, as well as our polymer expertise and platform development capability. We are going to market with what we believe is the first commercially viable PET closure.
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Our proprietary biomass conversion technology can use sustainable feedstocks such as sustainably harvested wood residues, agricultural waste, wood waste and even corrugated cardboard to produce materials and products that are currently made from fossil feedstocks such as petroleum and natural gas.
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We anticipate that our PET closure solutions can be transformative for packaging by designing for recycling circularity and improving the performance and sustainability of packaging. Our product candidates for markets include the PCO 1881 compliant PET closure and a tethered PET closure designed to comply with European cap tethering mandates and keep caps connected to bottles.
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The ability to use sustainable feedstocks that are not used in food production is one of the things that differentiates our biomass conversion technology from other sustainable materials companies that are limited to feedstocks used in food production such as vegetable oils or high fructose corn syrup and other sugars.
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Our first Origin CapFormer System, a PET closure manufacturing system, successfully completed its Factory Acceptance Test (“FAT”), which involves a series of tests performed on the system to ensure that the system meets the requirements and functions as intended, in September 2024.
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Due to abundant and renewable wood supplies that have historically stable pricing, our cost of production when using these feedstocks is expected to be more stable than potential competing platforms that use other types of feedstocks.
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Since September 2024, our CapFormer System has produced caps for commercial qualification and has been delivered to our operations and manufacturing center in Reed City, Michigan, where it commenced commercial production in February 2025. We anticipate bringing online additional CapFormer Systems as part of our scale-up strategy.
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We believe that end products made at commercial scale using our biomass conversion technology and wood feedstocks will have a significant unit cost advantage over products made from other low carbon feedstocks. Our chemicals can be converted into both “drop-in” materials and new materials with differentiated functional performance.
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In February 2025, we announced that three new CapFormer lines were nearing completion, with eight total lines expected by the end of December 2025. 3 Furanics Technologies Including Biomass Conversion Platform In addition to our closures business, we have developed a number of technologies related to furanics, a class of chemicals with properties enabling the production of widespread and valuable materials, like plastics.
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The “drop-in” products are chemically fungible with those produced from petroleum-based raw materials, and therefore these “drop-in” products can be fed into existing supply chains without modification to the equipment or production processes of our customers.
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We continue to perform development work related to our furanics technology. Origin 1, our plant in Sarnia, Ontario, Canada, is currently operating “on demand” with reduced staffing, while preserving our ability to generate product at small volumes sufficient to explore scale-up with strategic partners.
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Origin’s capability to produce carbon negative materials is protected by an intellectual property portfolio comprised of over 40 patents as well as trade secrets covering non-discoverable aspects of Origin’s critical manufacturing processes. We have developed strong partnerships with large, brand-name corporations determined to transition to sustainable materials to help meet their emissions reduction goals.
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This decision was made in alignment with our near-term focus on PET closures as our path to profitability and our asset light strategy for our future plant to further scale up furanics technology.
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For example, in 2017, we founded the “NaturALL Bottle Alliance” with Danone and Nestlé Waters, with PepsiCo joining in 2018, to accelerate the development of innovative packaging 3 solutions made with 100% sustainable and renewable resources.
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For our future plant, we have explored a variety of plant designs and conducted testing and optimization of various feedstocks to generate data that could influence our scale-up strategy. Market Opportunity We believe that our near-term and long-term addressable markets together exceed $1.0 trillion. • Approximately $65 billion immediate opportunity.
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Each member of the NaturALL Bottle Alliance has agreed to assist in establishing a supply chain for the production of the sustainable materials being developed by the NaturALL Bottle Alliance.
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These markets include polyesters for textiles, resin for packaging, solid fuels, activated carbon, carbon black for tires and polymer fillers, paints, coatings, soil additives, advanced polyesters, epoxies, plasticizers, polyurethanes, elastomers, emulsions and solvents. 4 Our Addressable Markets Within the estimated $65 billion closures market, we believe there is strong and growing demand for solutions offering superior performance and sustainability characteristics, We believe there is particularly strong demand for those products that are designed for circularity, thus enabling the re-use and recycling of materials, as opposed to waste and downcycling.
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Each member also agreed to provide technical equipment, resources, know-how and scientific skills necessary for the performance of the NaturALL Bottle Alliance’s research and development program, and to be responsible for its own expenses.
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We designed our PET closures to outperform today’s incumbent HDPE and polypropylene caps in ways that can improve product shelf life without relying on custom polymers, which can compromise the purity of the recycling system. Our technology enables the lightest cap for a wide variety of containers, reducing plastic waste and improving sustainability.
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The members’ agreements with us provided additional financial support for the research and development program and the commercialization of sustainable materials under development by the NaturALL Bottle Alliance. In addition to being customers, Danone, Nestlé and PepsiCo also invested in Origin.
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We expect to make PET closures in a wide variety of formats for not only beverage containers but food containers and others as well. Our furanics technologies and biomass conversion platform address the chemicals market broadly due to the flexible chemistry, low carbon footprint, and competitive unit economics of our intermediates.
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We have also significantly expanded our customer and partnership base over time to other industries, including relationships with Ford Motor Company, Mitsubishi Gas Chemical, PrimaLoft, Solvay, AECI, Stepan, Mitsui & Co., Packaging Matters, Minafin Group, LVMH Beauty, Mitsubishi Chemical Group, Kuraray, Revlon, ATC Plastics, Intertex, and others.
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Competitive Landscape In the closures market, we anticipate potential competition from traditional HDPE and polypropylene cap producers and other companies who could develop and launch PET caps. Following the trend of lightweighting, competitors may continue to develop lighter weight caps.
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We also expect to accelerate the development of high-performance products through technology collaborations and joint development agreements, which are also referred to as service agreements, with current and prospective customers. In these relationships, we expect to supply expertise and materials, including products we manufacture at our Origin 1 plant, and our customer partner provides funding and its own expertise.
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We expect our caps to be among the lightest of their kind; however, if alternative caps continue to become lighter, this could reduce our currently expected advantage with respect to this trait. We may also face competition from manufacturers of non-plastic containers.
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Together, we work to test and establish market demand, product formulations, and specifications that meet the customer’s needs in anticipation of that customer’s purchase of commercial volumes of the co-developed product. For example, we have created an all-PET (polyethylene terephthalate) closure, making “100% recycled PET” possible from cap to container to improve post-consumer recycling.
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Our competitive strengths related to that technology and product portfolio include: • Mono-Material Solution for Improved Recycling Circularity. Mono-material products are made with one type of material. They are typically easier to recycle than products made from multiple materials.
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Our PET caps and closures are more sustainable than common alternatives because they may be produced with any type of PET, from recycled PET to Origin’s 100% bio-based, carbon-negative virgin PET. PET offers better oxygen and CO2 barrier than HDPE and PP, common materials used in the production of caps.
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For Origin PET closures, there is no need to separate caps from bottles during the recycling process, as there is with containers whose caps and bottles are made of different materials. We believe this could be especially valuable for tethered cap solutions.
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Our vision for the future is the replacement of fossil-based feedstocks and materials with non-food, plant-based feedstocks and materials, while capturing carbon in the process. Our decarbonizing biomass conversion technology potentially addresses an estimated $1.0 trillion dollar market opportunity, and we believe it can help revolutionize the production of a wide range of end products.
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We are developing a tethered PET closure, which we anticipate will be the first commercially produced tethered PET closure. • Can Make Products Last Longer.
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Our biomass conversion technology is capable, using wood feedstocks, of producing CMF and HTC with a negative carbon impact. We believe these chemicals can replace petroleum-based inputs, lowering the carbon footprint of a wide range of materials without increasing cost or sacrificing performance. CMF.
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We believe our caps have the potential to extend product shelf life because they are made from PET, which offers improved gas barrier properties compared with common cap materials HDPE (high-density polyethylene) and polypropylene, preventing oxygen from getting in and CO 2 from getting out. • Enables Lighter Weight Products.
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CMF and its derivatives can be used to produce numerous commodity and specialty chemicals. We have developed products made from CMF that can be used in applications such as food and beverage packaging and apparel and carpet fibers, and our product development pipeline includes applications such as adhesives, coatings and plasticizers. HTC. HTC is a diverse, high-potential material.
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Because PET offers improved mechanical properties compared with other common cap materials, less plastic is needed to achieve the same or better performance, such as gas barrier, when produced with our proprietary approach.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

148 edited+63 added−24 removed193 unchanged
Biggest changeWe and the third parties upon which we rely may be subject to a variety of evolving threats, including but not limited to social-engineering attacks (including through phishing attacks), malicious code (such as viruses and worms), malware (including as a result of advanced persistent threat intrusions), denial-of-service attacks (such as credential stuffing), credential harvesting, personnel misconduct or error, ransomware attacks, supply-chain attacks, software bugs, server malfunctions, software or hardware failures, loss of data or other information technology assets, adware, telecommunications failures, earthquakes, fires, floods, and other similar threats. 30 Ransomware attacks, including those perpetrated by organized criminal threat actors, nation-states, and nation-state-supported actors, are becoming increasingly prevalent and severe – particularly for companies like ours that are engaged in manufacturing – and can lead to significant interruptions in our operations, loss of data and income, reputational harm, and diversion of funds.
Biggest changeDuring times of war and other major conflicts, we and the third parties with whom we work may be vulnerable to a heightened risk of these attacks, including retaliatory cyber-attacks, that could materially disrupt our systems and operations, supply chain, and ability to produce, sell and distribute our products. 31 We and the third parties with whom we work are subject to a variety of evolving threats, including but not limited to social-engineering attacks (including through deep fakes, which may be increasingly more difficult to identify as fake, and phishing attacks), malicious code (such as viruses and worms), malware (including as a result of advanced persistent threat intrusions), denial-of-service attacks credential stuffing, credential harvesting, personnel misconduct or error, ransomware attacks, supply-chain attacks, software bugs, server malfunctions, software or hardware failures, loss of data or other information technology assets, adware, telecommunications failures, earthquakes, fires, floods, attacks enhanced or facilitated by AI and other similar threats.
If we are unable to obtain such financing and government incentives, or secure sufficient customer agreements, on commercially reasonable terms, or at all, we will not be able to execute our growth strategy.
If we are unable to obtain such financing and/or government incentives, or secure sufficient customer agreements, on commercially reasonable terms, or at all, we will not be able to execute our growth strategy.
We cannot assure you that the market price of Common Stock will not fluctuate widely or decline significantly in the future in response to a number of factors, including, among others, the following: • the realization of any of the risk factors presented in this Report; • actual or anticipated differences in our estimates, or in the estimates of analysts, for our revenues, results of operations, level of indebtedness, liquidity or financial condition; • additions and departures of key personnel; • failure to comply with the requirements of Nasdaq; • failure to comply with the Sarbanes-Oxley Act or other laws or regulations; • future issuances, sales, resales or repurchases or anticipated issuances, sales, resales or repurchases, of our securities; • publication of research reports about us; • the performance and market valuations of other similar companies; • commencement of, or involvement in, litigation involving us; 33 • broad disruptions in the financial markets, including sudden disruptions in the credit markets; • speculation in the press or investment community; • actual, potential or perceived control, accounting or reporting problems; • changes in accounting principles, policies and guidelines; and • other events or factors, including those resulting from infectious diseases, health epidemics and pandemics, natural disasters, war, acts of terrorism or responses to these events.
We cannot assure you that the market price of Common Stock will not fluctuate widely or decline significantly in the future in response to a number of factors, including, among others, the following: • the realization of any of the risk factors presented in this Report; • actual or anticipated differences in our estimates, or in the estimates of analysts, for our revenues, results of operations, level of indebtedness, liquidity or financial condition; • additions and departures of key personnel; • failure to comply with the requirements of Nasdaq; • failure to comply with the Sarbanes-Oxley Act or other laws or regulations; • future issuances, sales, resales or repurchases or anticipated issuances, sales, resales or repurchases, of our securities; • publication of research reports about us; • the performance and market valuations of other similar companies; • commencement of, or involvement in, litigation involving us; • broad disruptions in the financial markets, including sudden disruptions in the credit markets; • speculation in the press or investment community; • actual, potential or perceived control, accounting or reporting problems; • changes in accounting principles, policies and guidelines; and • other events or factors, including those resulting from infectious diseases, health epidemics and pandemics, natural disasters, war, acts of terrorism or responses to these events.
Our quarterly operating results may fluctuate significantly because of several factors, including: • labor availability and costs for hourly and management personnel; • profitability of our products; • changes in interest rates; • impairment of long-lived assets; • macroeconomic conditions, such as inflation and increasing interest rates, which may increase the risk of a potential recession; • negative publicity relating to products we serve; • changes in consumer preferences and competitive conditions; • expansion to new markets; and • fluctuations in commodity prices.
Our quarterly operating results may fluctuate significantly because of several factors, including: • labor availability and costs for hourly and management personnel; • profitability of our products; • changes in interest rates; • impairment of long-lived assets; • macroeconomic conditions, such as inflation and increasing interest rates, which may increase the risk of a potential recession; 35 • negative publicity relating to products we serve; • changes in consumer preferences and competitive conditions; • expansion to new markets; and • fluctuations in commodity prices.
We have entered into, and may enter into, strategic partnerships to develop and commercialize our current and future research and development programs with other companies to accomplish one or more of the following: • obtain capital, equipment, and facilities; 20 • obtain funding for research and development programs, product development programs, and commercialization activities; • obtain expertise in relevant markets; • obtain access to raw materials; • obtain sales and marketing services or support; • obtain conversion services and other supply chain support; and/or • obtain access to intellectual property and ensure freedom to operate.
We have entered into, and may enter into, strategic partnerships to develop and commercialize our current and future research and development programs with other companies to accomplish one or more of the following: • obtain capital, equipment, and facilities; • obtain funding for research and development programs, product development programs, and commercialization activities; • obtain expertise in relevant markets; • obtain access to raw materials; • obtain sales and marketing services or support; • obtain conversion services and other supply chain support; and/or • obtain access to intellectual property and ensure freedom to operate.
These consequences may include: government enforcement actions (for example, investigations, fines, penalties, audits, and inspections); additional reporting requirements and/or oversight; restrictions on processing data (including personal data); litigation (including class claims); indemnification obligations; negative publicity; reputational harm; monetary fund diversions; interruptions in our operations (including availability of data); financial loss; and other similar harms.
These consequences may include: government enforcement actions (for example, investigations, fines, penalties, audits, and inspections); additional reporting requirements and/or oversight; restrictions on processing data (including personal data); litigation (including class-action claims); indemnification obligations; negative publicity; reputational harm; monetary fund diversions; interruptions in our operations (including availability of data); financial loss; and other similar harms.
In addition, the expiration of a patent can result in increased competition with consequent erosion of profit margins. 26 The applicable governmental authorities may not approve our pending service mark and trademark applications. A failure to obtain trademark registrations in the U.S. and in other countries could limit our ability to obtain and retain our trademarks in those jurisdictions.
In addition, the expiration of a patent can result in increased competition with consequent erosion of profit margins. The applicable governmental authorities may not approve our pending service mark and trademark applications. A failure to obtain trademark registrations in the U.S. and in other countries could limit our ability to obtain and retain our trademarks in those jurisdictions.
Security incidents and attendant consequences may negatively impact our ability to grow and operate our business. Our contracts may not contain limitations of liability, and even where they do, there can be no assurance that limitations of liability in our contracts are sufficient to protect us from liabilities, damages, or claims related to our data privacy and security obligations.
Security incidents and attendant material consequences may negatively impact our ability to grow and operate our business. Our contracts may not contain limitations of liability, and even where they do, there can be no assurance that limitations of liability in our contracts are sufficient to protect us from liabilities, damages, or claims related to our data privacy and security obligations.
Because we will incur the costs and expenses from these efforts before receiving meaningful revenue, our losses in future periods could be significant. We may find that these efforts are more expensive than we currently estimate or that these efforts may not result in revenues, which would further increase our losses. We may not manage growth effectively.
Because we will incur the costs and expenses from these efforts before receiving meaningful revenue, our losses in future periods could be significant. We may find that these efforts are more expensive than we currently estimate or that these efforts may not result in revenues, which would further increase our losses. 12 We may not manage growth effectively.
In order to evaluate the effectiveness of internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act, management has conducted an assessment, including testing, using the criteria in Internal Control – Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) using the 2013 framework.
In order to evaluate the effectiveness of internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act, management has conducted an assessment, including testing, using the criteria in Internal Control – Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission using the 2013 framework.
For example, any failure by a third-party processor to comply with applicable law, regulations, or contractual obligations could result in adverse effects, including inability to or interruptions in our ability to operate our business and proceedings against us by governmental entities or others.
For example, any failure by a third-party processor to comply with applicable law, regulations, or contractual obligations could result in material adverse effects, including inability to or interruptions in our ability to operate our business and proceedings against us by governmental entities or others.
Any future determination to pay dividends on our capital stock will be at the discretion of our Board. In addition, our loan agreements contain restrictions on our ability to pay dividends. The market price and trading volume of our Common Stock has been and may be volatile and could decline significantly.
Any future determination to pay dividends on our capital stock will be at the discretion of our Board. In addition, our loan agreements contain restrictions on our ability to pay dividends. 34 The market price and trading volume of our Common Stock has been and may be volatile and could decline significantly.
Any violations of the laws and regulations described above may result in substantial civil and criminal fines and penalties, imprisonment, the loss of export or import privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm and other consequences. 25 Our operating plan may require us to source feedstock and supplies internationally, and foreign currency exchange rate fluctuations and changes to international trade agreements, tariffs, import and excise duties, taxes or other governmental rules and regulations could adversely affect our business, financial condition, results of operations and prospects.
Any violations of the laws and regulations described above may result in substantial civil and criminal fines and penalties, imprisonment, the loss of export or import privileges, debarment, tax reassessments, breach of contract and fraud litigation, reputational harm and other consequences. 24 Our operating plan may require us to source feedstock and supplies internationally, and foreign currency exchange rate fluctuations and changes to international trade agreements, tariffs, import and excise duties, taxes or other governmental rules and regulations could adversely affect our business, financial condition, results of operations and prospects.
Redemption of the outstanding Warrants could force you (a) to exercise your Warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (b) to sell your Warrants at the then-current market price when you might otherwise wish to hold your Warrants or (c) to accept the nominal redemption price which, at the time the outstanding Warrants are called for redemption, is likely to be substantially less than the market value of your Warrants. 36 In addition, we may redeem your Warrants after they become exercisable for a number of shares of Common Stock determined based on the redemption date and the fair market value of our Common Stock.
Redemption of the outstanding Warrants could force you (a) to exercise your Warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (b) to sell your Warrants at the then-current market price when you might otherwise wish to hold your Warrants or (c) to accept the nominal redemption price which, at the time the outstanding Warrants are called for redemption, is likely to be substantially less than the market value of your Warrants. 37 In addition, we may redeem your Warrants after they become exercisable for a number of shares of Common Stock determined based on the redemption date and the fair market value of our Common Stock.
Any shutdown or period of reduced production at these facilities, which may be caused by regulatory noncompliance or other issues, as well as other factors beyond our control, such as severe weather conditions, natural disaster, fire, power interruption, work stoppage, disease outbreaks or pandemics (such as COVID-19), equipment failure or delay in supply delivery, would, among other things, significantly disrupt our ability to recognize revenue, execute our expansion plans, and meet our contractual obligations and customer demand.
Any shutdown or period of reduced production at these facilities, which may be caused by regulatory noncompliance or other issues, as well as other factors beyond our control, such as severe weather conditions, natural disaster, fire, power interruption, work stoppage, disease outbreaks or pandemics, equipment failure or delay in supply delivery, would, among other things, significantly disrupt our ability to recognize revenue, execute our expansion plans, and meet our contractual obligations and customer demand.
The cost of raw materials and energy to produce steam required during feedstock processing comprises a significant amount of our total cost of goods sold and, as a result, movements in the cost of raw materials, and in the cost of other inputs, will impact our profitability.
The cost of raw materials and energy, such as to produce the steam required during feedstock processing comprises a significant amount of our total cost of goods sold and, as a result, movements in the cost of raw materials, and in the cost of other inputs, will impact our profitability.
The various bioindustrial markets in which we plan to operate are subject to frequent and extensive litigation regarding patents, trade secrets and other intellectual property rights. Many of our competitors have a substantial amount of intellectual property.
The various markets in which we plan to operate are subject to frequent and extensive litigation regarding patents, trade secrets and other intellectual property rights. Many of our competitors have a substantial amount of intellectual property.
We also could become subject to investigations by Nasdaq, the SEC or other regulatory authorities. 28 As a public company, we are also required, pursuant to Section 404 of the Sarbanes-Oxley Act, to furnish a report by management on, among other things, the effectiveness of its internal control over financial reporting for our annual reports on Form 10-K to be filed with the SEC.
We also could become subject to investigations by Nasdaq, the SEC or other regulatory authorities. 29 As a public company, we are also required, pursuant to Section 404 of the Sarbanes-Oxley Act, to furnish a report by management on, among other things, the effectiveness of its internal control over financial reporting for our annual reports on Form 10-K to be filed with the SEC.
We are subject to, among other things, the following factors that may negatively affect our operating results: • the announcement or introduction of new products by our competitors; • our ability to upgrade and develop our systems and infrastructure to accommodate growth; • our ability to attract and retain key personnel in a timely and cost-effective manner; • our ability to attract new customers and retain existing customers; 22 • technical difficulties; • the amount and timing of operating costs and capital expenditures relating to the expansion of our business, operations and infrastructure; • our ability to identify and enter into relationships with appropriate and qualified third-party providers of necessary testing and manufacturing services; • regulation by federal, state or local governments; and • general economic conditions, as well as economic conditions specific to the chemicals, plastics, carbon products, and fuels industries, and other industries related to compostable or biodegradable substitutes for non-biodegradable plastics, as well as changes to commodity prices to which prices in some of our contracts are indexed.
We are subject to, among other things, the following factors that may negatively affect our operating results: • the announcement or introduction of new products by our competitors; • our ability to upgrade and develop our systems and infrastructure to accommodate growth; • our ability to attract and retain key personnel in a timely and cost-effective manner; 21 • our ability to attract new customers and retain existing customers; • technical difficulties; • the amount and timing of operating costs and capital expenditures relating to the expansion of our business, operations and infrastructure; • our ability to identify and enter into relationships with appropriate and qualified third-party providers of necessary testing and manufacturing services; • regulation by federal, state or local governments; and • general economic conditions, as well as economic conditions specific to the closures industry, and the chemicals, plastics, carbon products, and fuels industries, and other industries related to compostable or biodegradable substitutes for non-biodegradable plastics, as well as changes to commodity prices to which prices in some of our contracts are indexed.
We have recorded a valuation allowance related to the majority of our NOL carryforwards and other deferred tax assets due to the uncertainty of the ultimate realization of the future benefits of those assets. 24 Risks Related to Government Regulation Compliance with extensive environmental, health and safety laws could require material expenditures, changes in our operations or site remediation.
We have recorded a valuation allowance related to the majority of our NOL carryforwards and other deferred tax assets due to the uncertainty of the ultimate realization of the future benefits of those assets. 23 Risks Related to Government Regulation Compliance with extensive environmental, health and safety laws could require material expenditures, changes in our operations or site remediation.
If Canadian taxation authorities successfully challenge such expenses or the correctness of such income tax credits claimed, our historical operating results could be adversely affected. As a public company, we will no longer be eligible for refundable tax credits under the Canadian federal Scientific Research and Experimental Development Program (“SR&ED”) credits.
If Canadian taxation authorities successfully challenge such expenses or the correctness of such income tax credits claimed, our historical operating results could be adversely affected. As a public company, we will no longer be eligible for refundable tax credits under the Canadian federal Scientific Research and Experimental Development Program credits.
Such changes may also apply retroactively to our historical operations and result in taxes greater than the amounts estimated and recorded in our financial statements. 23 Unanticipated changes in effective tax rates or adverse outcomes resulting from examination of our income or other tax returns could adversely affect our operating results and financial condition.
Such changes may also apply retroactively to our historical operations and result in taxes greater than the amounts estimated and recorded in our financial statements. 22 Unanticipated changes in effective tax rates or adverse outcomes resulting from examination of our income or other tax returns could adversely affect our operating results and financial condition.
Even if we are successful in our efforts to establish such collaborations, the terms that we agree upon may not be favorable to us, and we may not be able to maintain such collaborations. 21 In addition, any potential future collaborations may be terminable by our strategic partners, and we may not be able to adequately protect our rights under these agreements.
Even if we are successful in our efforts to establish such collaborations, the terms that we agree upon may not be favorable to us, and we may not be able to maintain such collaborations. 20 In addition, any potential future collaborations may be terminable by our strategic partners, and we may not be able to adequately protect our rights under these agreements.
We may issue additional shares of Common Stock or other equity securities without shareholder approval, which would dilute shareholders’ ownership interests and may depress the market price of the Common Stock. As of December 31, 2023 we have Warrants outstanding to purchase an aggregate of 35,476,627 shares of Common Stock.
We may issue additional shares of Common Stock or other equity securities without shareholder approval, which would dilute shareholders’ ownership interests and may depress the market price of the Common Stock. As of December 31, 2024 we have Warrants outstanding to purchase an aggregate of 35,476,627 shares of Common Stock.
Any decline in the value of carbon credits associated with our products could harm our results of operations, cash flow and financial condition. The value of our products may be dependent on the value of carbon credits, programs relating to low-carbon materials and products standards and other similar regulatory regimes or the implicit value of decarbonized materials.
A decline in the value of carbon credits associated with our products, if any, could harm our results of operations, cash flow and financial condition. The value of our products may be dependent on the value of carbon credits, programs relating to low-carbon materials and products standards and other similar regulatory regimes or the implicit value of decarbonized materials.
Errors, defects in materials, operating permit and license delays, customer product returns, interruption in our supply of materials or resources, and disruptions at our facilities due to accidents, maintenance issues, or unsafe working conditions, all could affect the timing, efficiency, or success of our production processes.
Errors, defects in materials, operating permit and license delays, customer product returns, interruption in our supply of materials or resources, and disruptions at our facilities or those of our partners due to accidents, maintenance issues, or unsafe working conditions, all could affect the timing, efficiency, or success of our production processes.
The unavailability of any raw materials could result in production delays, idle manufacturing facilities, product design changes and loss of access to important residues supporting our production, as well as impact our capacity to fulfill our obligations under our offtake agreements.
The unavailability of any raw materials could result in production delays, idle manufacturing facilities, product design changes and loss of access to important residues supporting our production, as well as impact our capacity to fulfill our obligations under our supply agreements.
The GDPR also allows for private litigation related to processing of personal data brought by classes of data subjects or consumer protection organizations authorized at law to represent their interests. Additionally, in Canada, the Personal Information Protection and Electronic Documents Act (“PIPEDA”) and various related provincial laws, as well as Canada’s Anti-Spam Legislation (“CASL”), may apply to our operations.
The GDPR also allows for private litigation related to processing of personal data brought by classes of data subjects or consumer protection organizations authorized at law to represent their interests. Additionally, in Canada, the Personal Information Protection and Electronic Documents Act and various related provincial laws, as well as Canada’s Anti-Spam Legislation, apply to our operations.
In addition, others may obtain knowledge of our trade secrets through independent development or other access by legal means. Other Risks Related to Our Business Our management has limited experience in operating a public company.
In addition, others may obtain knowledge of our trade secrets through independent development or other access by legal means. Other Risks Related to Our Business Our management team has relatively limited experience in operating a public company.
Parts of our supply chain currently are dependent on a limited number, and in some cases a single, third-party supplier or service provider for key inputs, equipment, and services including for conversion of our chemical intermediates produced by our Origin 1 plant into downstream derivatives and applications.
Parts of our supply chain currently are dependent on a limited number, and in some cases a single, third-party supplier or service provider for key inputs, equipment, and services including for conversion of our chemical intermediates produced by our Origin 1 plant into downstream derivatives and applications and for production of our PET closures.
Although we endeavor to comply with all applicable data privacy and security obligations, we may at times fail (or be perceived to have failed) to do so. Moreover, despite our efforts, our personnel or third parties upon whom we rely may fail to comply with such obligations, which could negatively impact our business operations and compliance posture.
Although we endeavor to comply with all applicable data privacy and security obligations, we may at times fail (or be perceived to have failed) to do so. Moreover, despite our efforts, our personnel or third parties with whom we work may fail to comply with such obligations, which could negatively impact our business operations and compliance posture.
Many of these laws and regulations have become more stringent over time and the costs of compliance with these requirements may increase, including costs associated with any necessary capital investments. In addition, our plants will require operating permits that are subject to renewal and, in some circumstances, revocation.
Many of these laws and regulations have become more stringent over time and the costs of compliance with these requirements may increase, including costs associated with any necessary capital investments. In addition, our manufacturing facilities will require operating permits that are subject to renewal and, in some circumstances, revocation.
There are significant technological and logistical challenges associated with producing, marketing, selling and distributing products in the specialty chemicals industry, including our products, and we may not be able to resolve all of the difficulties that may arise in a timely or cost-effective manner, or at all.
There are significant technological and logistical challenges associated with producing, marketing, selling, and distributing products in the specialty chemicals and closures industries, including our products, and we may not be able to resolve all of the difficulties that arise in a timely or cost-effective manner, or at all.
Based on our estimates and projections, which are subject to significant risks and uncertainties, we expect our commercial scale production to be limited for several years and challenges with the design, construction, funding, and labor and equipment supply for our plants may further delay this timeline.
Based on our estimates and projections, which are subject to significant risks and uncertainties, we expect our commercial scale production to be limited for several years and challenges with the design, construction, funding, and labor and equipment supply for our closures manufacturing lines and plants may further delay this timeline.
Our ability to utilize our NOL carryforwards and other tax attributes to offset future taxable income or tax liabilities may be limited as a result of ownership changes, including potential changes in connection with the Business Combination or other transactions. Similar rules may apply under state tax laws.
Our ability to utilize our NOL carryforwards and other tax attributes to offset future taxable income or tax liabilities may be limited as a result of ownership changes, including potential changes in connection with the Merger or other transactions. Similar rules may apply under state tax laws.
In connection with the audit of our consolidated financial statements for the fiscal years ended December 31, 2019 and December 31, 2020, during the course of preparing for the Business Combination, and during the second quarter 2021 and third quarter 2021 interim reviews, we identified a material weakness in our internal control over financial reporting.
In connection with the audit of our consolidated financial statements for the fiscal years ended December 31, 2019 and December 31, 2020, during the course of preparing for the Merger, and during the second quarter 2021 and third quarter 2021 interim reviews, we identified a material weakness in our internal control over financial reporting.
We may not be successful in our efforts to establish such strategic partnerships or other alternative arrangements for our products, technology, or plants because our research and development pipeline may be insufficient, our products or plant designs or manufacturing processes may be deemed to be at too early of a stage of development for collaborative effort, or third parties may not view our products or plants as having the requisite potential to demonstrate commercial success.
We may not be successful in our efforts to establish such strategic partnerships or other alternative arrangements for our products, technology, or manufacturing facilities because our research and development pipeline may be insufficient, our products or manufacturing facility designs or processes may be deemed to be at too early of a stage of development for collaborative effort, or third parties may not view our products or manufacturing facilities as having the requisite potential to demonstrate commercial success.
On January 4, 2023, we received a deficiency letter from the Listing Qualifications Department of the Nasdaq (the “Nasdaq Staff”), notifying us that, for the last 30 consecutive business days, the closing bid price for our Class A common stock had closed below the minimum $1.00 per share required for continued listing on the Nasdaq pursuant to Nasdaq Listing Rule 5550(a)(2) (“Rule 5550(a)(2)”).
On January 4, 2024, we received a deficiency letter from the Listing Qualifications Department of the Nasdaq, notifying us that, for the last 30 consecutive business days, the closing bid price for our Class A common stock had closed below the minimum $1.00 per share required for continued listing on the Nasdaq pursuant to Nasdaq Listing Rule 5550(a)(2) (“Rule 5550(a)(2)”).
We may expend significant resources or modify our business activities in an effort to protect against security incidents. Certain data privacy and security obligations may require us to implement and maintain specific security measures, industry-standard or reasonable security measures to protect our information technology systems and sensitive information.
We may expend significant resources or modify our business activities in an effort to protect against security incidents. Certain data privacy and security obligations have required us to implement and maintain specific security measures, industry-standard or reasonable security measures to protect our information technology systems and sensitive information.
We currently have commercial agreements with a limited number of customers from which we expect to derive a significant portion of near-term revenue.
We currently have commercial arrangements with a limited number of customers from which we expect to derive a significant portion of near-term revenue.
In addition, climate change may negatively impact the availability of our feedstock, for example, by increasing the prevalence of certain pests harmful to the growth or quality of the biomass we use in our processes.
In addition, climate change may negatively impact the availability of our feedstock, for example, by increasing the prevalence of certain pests harmful to the growth or quality of the biomass we use in our processes to produce Furanic Intermediates.
Our ability to use net operating loss carryforwards and other tax attributes may be limited in connection with the Business Combination or other ownership changes. We have incurred losses during our history.
Our ability to use net operating loss carryforwards and other tax attributes may be limited in connection with the Merger or other ownership changes. We have incurred losses during our history.
Some prospective customers are currently evaluating and testing our products prior to making large-scale purchase decisions. Other products we expect to develop have not yet started customer evaluation and testing. The successful commercialization of our products is dependent on our customers’ ability to commercialize the end-products that utilize our products, which may gain market acceptance slowly, if at all.
Some prospective customers are currently evaluating and testing our products prior to making large-scale purchase decisions. Other products we expect to develop have not yet started customer evaluation and testing. The successful commercialization of our products depends on our customers’ ability to commercialize the end-products that use our products, which may gain market acceptance slowly, if at all.
A security incident or other interruption could result in unauthorized, unlawful, or accidental acquisition, modification, destruction, loss, alteration, encryption, disclosure of, or access to our sensitive information. A security incident or other interruption could disrupt our ability (and that of third parties upon whom we rely) to provide our products.
A security incident or other interruption could result in unauthorized, unlawful, or accidental acquisition, modification, destruction, loss, alteration, encryption, disclosure of, or access to our sensitive information. A security incident or other interruption could disrupt our ability (and that of third parties with whom we work) to provide our products.
Furthermore, various petrochemical products, including plastics, have faced increased public scrutiny due to negative coverage of plastic waste in the environment, which has resulted in local, state, federal and foreign governments proposing and in some cases approving, restrictions or bans on the manufacture, consumption and disposal of certain petrochemical products.
Furthermore, various petrochemical products, including plastics like PET used in our closures products, have faced increased public scrutiny due to negative coverage of plastic waste in the environment, which has resulted in local, state, federal and foreign governments proposing and in some cases approving, restrictions or bans on the manufacture, consumption and disposal of certain petrochemical products.
We rely upon third-party service providers and technologies to operate critical business systems to process sensitive information in a variety of contexts, including, without limitation, third-party providers of cloud-based infrastructure, encryption and authentication technology, employee email, content delivery to customers, manufacturing processing, process orders and invoices, payments, inventory management and other functions.
We rely on third-parties to operate critical business systems to process sensitive information in a variety of contexts, including, without limitation, third-party providers of cloud-based infrastructure, encryption and authentication technology, employee email, content delivery to customers, manufacturing processing, process orders and invoices, payments, inventory management and other functions.
Our Certificate of Incorporation and Bylaws provide that we will indemnify our directors and officers, in each case to the fullest extent permitted by Delaware law. 32 In addition, as permitted by Section 145 of the DGCL, the Bylaws and its indemnification agreements that we entered into with our directors and officers provide that: • we will indemnify our directors and officers for serving us in those capacities or for serving other business enterprises at our request, to the fullest extent permitted by Delaware law.
In addition, as permitted by Section 145 of the DGCL, the Bylaws and its indemnification agreements that we entered into with our directors and officers provide that: • we will indemnify our directors and officers for serving us in those capacities or for serving other business enterprises at our request, to the fullest extent permitted by Delaware law.
While we believe that we understand the engineering and process characteristics necessary to successfully build and operate our additional planned facilities and to scale up to larger facilities, we may not be able to cost-effectively manage such construction and operation at a scale or quality consistent with customer demand in a timely or economical manner.
While we believe that we understand the engineering and process characteristics necessary to successfully build and operate additional planned facilities and scale up to larger and/or additional facilities, we may be unable to cost-effectively manage such construction and operation at a scale or quality consistent with customer demand in a timely or economical manner or at all.
Additionally, remote work has become more common and has increased risks to our information technology systems and data, as more of our employees utilize network connections, computers and devices outside our premises or network, including working at home, while in transit and in public locations.
Additionally, remote work has increased risks to our information technology systems and data, as our employees utilize network connections, computers and devices outside our premises or network, including working at home, while in transit and in public locations.
Concerns associated with bioplastics, including land usage, national security interests, deforestation, food crop usage and other environmental concerns, continue to receive legislative, industry and public attention. This attention could result in future legislation, regulation and/or administrative action that could adversely affect our business.
Concerns associated with bioplastics, including land usage, national security interests, deforestation, food crop usage, and other environmental concerns with bioplastics as well as plastic products generally, continue to receive legislative, industry and public attention. This attention could result in future legislation, regulation and/or administrative action that could adversely affect our business.
If our information technology systems or data, or those of third parties upon which we rely, are or were compromised, we could experience adverse consequences resulting from such compromise, including but not limited to regulatory investigations or actions; litigation; fines and penalties; disruptions of our business operations; reputational harm; loss of revenue or profits; loss of customers; and other adverse consequences.
If our information technology systems or data, or those of third parties with whom we work, are or were compromised, we could experience adverse consequences resulting from such compromise, including but not limited to regulatory investigations or actions; litigation; fines and penalties; disruptions of our business operations; reputational harm; loss of revenue or profits; loss of customers; and other adverse consequences.
We have not yet secured such project financing and government incentives, and they may not be available on commercially reasonable terms, if at all.
We have not yet secured all such project financing and government incentives, and may not in the future, and they may not be available on commercially reasonable terms, if at all.
The cost of these raw materials is generally influenced by supply and demand factors, and our operating plans include assumptions that the timber and forest residues we intend to use as feedstock will be available at prices similar to historic levels with low volatility.
The cost of these raw materials is generally influenced by supply and demand factors, and our operating plans include assumptions that the materials we intend to use as feedstocks will be available at prices similar to historic levels with low volatility.
We are, and may continue to be, involved in litigation and administrative actions to protect these rights, and such proceedings could be burdensome and costly, could result in counterclaims challenging our intellectual property (including validity or enforceability) or accusing us of infringement, and we may not prevail.
We have been, and may again be, involved in litigation and administrative actions to protect these rights, and such proceedings could be burdensome and costly, could result in counterclaims challenging our intellectual property (including validity or enforceability) or accusing us of infringement, and we may not prevail.
In particular, our ability to obtain financing for the construction of future plants may depend in part on our ability to first enter into customer agreements sufficient to demonstrate sufficient demand to justify the construction of such plants.
In particular, our ability to obtain financing for the construction of future manufacturing lines and plants may depend, in part, on our ability to first enter into customer agreements that demonstrate sufficient demand to justify such construction.
Preparing for and complying with these obligations may require us to devote significant resources (including, without limitation, financial and time-related resources). These obligations may necessitate changes to our information technologies, systems, and practices and to those of any third parties that process personal data on our behalf.
Preparing for and complying with these obligations requires us to devote significant resources (including, without limitation, financial and time-related resources). These obligations may necessitate changes to our information technologies, systems, and practices and to those of any third parties that process personal data on our behalf. In addition, these obligations may require us to change our business model.
Our operating plan assumes that we will rely on a limited number of plants to meet customer demand and that these plants will supply most of our products until additional plants come online. Adverse changes or developments affecting these facilities could impair our ability to produce our products.
Our operating plan assumes that we will rely on a limited number of manufacturing facilities to meet customer demand and that these facilities will supply most of our products until additional facilities can be brought online. Adverse changes or developments affecting these facilities could impair our ability to produce our products.
Additionally, our assessment of the projected benefits associated with the construction of new manufacturing facilities is subject to a number of estimates and assumptions, which in turn are subject to significant economic, competitive and other uncertainties that are beyond our control.
Additionally, our assessment of the projected benefits associated with the construction of new manufacturing facilities, including production lines for our PET closures, is subject to a number of estimates and assumptions, which in turn are subject to significant economic, competitive and other uncertainties that are beyond our control.
These provisions include: • initially providing for a classified Board with staggered, three-year terms; • authorizing our Board to issue Preferred Stock with voting or other rights or preferences that could discourage a takeover attempt or delay changes in control; • prohibiting cumulative voting in the election of directors; • providing that vacancies on our Board may generally be filled only by a majority of directors then in office, even though less than a quorum; • prohibiting the adoption, amendment or repeal of the Bylaws or the repeal of the provisions of our Certificate of Incorporation regarding the election and removal of directors without the required approval of at least two-thirds of the shares entitled to vote at an election of directors; • prohibiting stockholder action by written consent; • limiting the persons who may call special meetings of stockholders; and • requiring advance notification of stockholder nominations and proposals.
These provisions include: • initially providing for a classified Board with staggered, three-year terms; • authorizing our Board to issue Preferred Stock with voting or other rights or preferences that could discourage a takeover attempt or delay changes in control; • prohibiting cumulative voting in the election of directors; • providing that vacancies on our Board may generally be filled only by a majority of directors then in office, even though less than a quorum; • prohibiting the adoption, amendment or repeal of the Bylaws or the repeal of the provisions of our Certificate of Incorporation regarding the election and removal of directors without the required approval of at least two-thirds of the shares entitled to vote at an election of directors; • prohibiting stockholder action by written consent; • limiting the persons who may call special meetings of stockholders; and • requiring advance notification of stockholder nominations and proposals. 33 These provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our Board, which is responsible for appointing the members of our management.
In addition, supply-chain attacks have increased in frequency and severity, and we cannot guarantee that third parties’ infrastructure in our supply chain or our third-party partners’ supply chains have not been compromised. We may share or receive sensitive information with or from third parties.
In addition, supply-chain attacks have increased in frequency and severity, and we cannot guarantee that third parties’ infrastructure in our supply chain or that the third-parties with whom we work have not been compromised. We may share or receive sensitive information with or from third parties.
For example, the California Consumer Privacy Act of 2018 (“CCPA”) imposes obligations on businesses to which it applies, such as providing specific disclosures in privacy notices and affording California residents certain rights related to their personal data and applies to personal information of consumers, business representatives, and employees who are California residents.
For example, the California Consumer Privacy Act of 2018 (“CCPA”) imposes obligations on businesses to which it applies, such as providing specific disclosures in privacy notices and affording California residents certain rights related to their personal data.
Changes in these laws, regulations and policies or how these laws, regulations and policies are implemented and enforced could cause the demand for bioplastics to decline and deter investment in the research and development of bioplastics.
Changes in these laws, regulations and policies or how these laws, regulations and policies are implemented and enforced could cause the demand for our products to decline and deter investment in the research and development of such product.
Although our products are intended to replace petrochemical products, increased regulation on the use of such products or other products in the specialty chemicals industry, whatever their scope or form, could increase our costs of production, impact overall consumption of our products or result in misdirected negative publicity.
Although our biomass-derived chemical products and materials made from them are intended to replace petrochemical products, increased regulation on the use of such products or other products in the specialty chemicals industry, whatever their scope or form, could increase our costs of production, impact overall consumption of our products or result in misdirected negative publicity.
If we fail to enter into collaborations and do not have sufficient funds or expertise to undertake the necessary development and commercialization activities, we may not be able to develop additional products or plants, and our business, financial condition, results of operations and prospects may be materially and adversely affected.
If we fail to enter into collaborations and do not have sufficient funds or expertise to undertake the necessary development and commercialization activities, we may not be able to develop additional products or plants, and our business, financial condition, results of operations and prospects may be materially and adversely affected. 19 We may rely heavily on future collaborative and supply chain partners.
As we continue to expand our production, we will increase our demand for timber and forest residues which may alter the anticipated stability in the costs of our raw materials and potentially drive an increase in the cost of such raw materials.
As we continue to expand our production, we will increase our demand for PET to produce our PET closures, and of timber and forest residues to produce our chemical intermediates, which may alter the anticipated stability in the costs of our raw materials and potentially drive an increase in their cost.
If we fail, or are perceived to have failed, to address or comply with data privacy and security obligations, we could face significant consequences.
If we or the third parties with whom we work fail, or are perceived to have failed, to address or comply with data privacy and security obligations, we could face significant consequences.
If we fail to continue to satisfy the continued listing requirements of Nasdaq, such as the corporate governance or public float requirements, or the minimum closing bid price requirement, Nasdaq will take steps to delist our common stock. The per share price of our common stock has declined below the minimum bid price threshold required for continued listing.
If we fail to continue to satisfy the continued listing requirements of Nasdaq, such as the corporate governance or public float requirements, or the minimum closing bid price requirement, Nasdaq will take steps to delist our common stock.
Even if such insurance is available, product liability or other claims may exceed our insurance coverage limits. A successful product liability claim that exceeds our insurance coverage limits, for which we are not otherwise indemnified, could require us to pay substantial sums and could harm our business, financial condition or results of operations.
A successful product liability claim that exceeds our insurance coverage limits, for which we are not otherwise indemnified, could require us to pay substantial sums and could harm our business, financial condition or results of operations.
Pursuant to the Merger Agreement, we may issue up to 25,000,000 shares of our Common Stock as Earnout Shares. In addition, pursuant to the 2021 EIP Plan and the ESPP, we may issue an aggregate of up to 30,004,203 shares of Common Stock, which amount is subject to increase from time to time.
Pursuant to the Merger Agreement, we may issue up to 25,000,000 shares of our Common Stock as Earnout Shares. In addition, pursuant to the 2021 Equity Incentive Plan and the ESPP, we may issue an aggregate of up to 36,392,293 shares of Common Stock, which amount is subject to increase from time to time.
We are subject to stringent and changing U.S. and foreign laws, regulations, rules, contractual obligations, policies and other obligations related to data privacy and security.
We and the third parties with whom we work are subject to stringent and changing U.S. and foreign laws, regulations, rules, contractual obligations, policies and other obligations related to data privacy and security.
Our potential profitability is dependent upon many factors, including our ability to effectively operate our current plants, complete development of future plants, maintain an adequate supply chain, anticipate and react to demand for our products, 13 manufacture our products on a commercial scale, secure additional customer commitments, and otherwise execute our growth plan.
Our potential profitability is dependent upon many factors, including our ability to complete development of our closures manufacturing lines and effectively operate those lines, as well as our current Origin 1 plant, maintain an adequate supply chain, anticipate and react to demand for our products, manufacture our products on a commercial scale, secure additional customer commitments, and otherwise execute our growth plan.
We intend to make significant capital investments into the research and development of proprietary information and other intellectual property as we develop, improve and scale our processes, technologies and products, and failure to fund and make these investments, or underperformance of the technology funded by these investments, could severely impact our business, financial condition, results of operations and prospects.
We intend to make significant capital investments into the research and development of proprietary information and other intellectual property as we develop, improve and scale our processes, technologies and products, and failure to fund and make these investments, or underperformance of the technology funded by these investments, could severely impact our business, financial condition, results of operations and prospects. 26 If we fail to adequately protect our intellectual property rights, such failure could result in the reduction or loss of our competitive advantage.
While we may be entitled to damages if our third-party service providers fail to satisfy their privacy or security-related obligations to us, any award may be insufficient to cover our damages, or we may be unable to recover such award.
While we may be entitled to damages if a third party with whom we work fails to satisfy their privacy or security-related obligations to us, any award may be insufficient to cover our damages, or we may be unable to recover such award.
Market acceptance of our products will depend on numerous factors, many of which are outside of our control, including, among others: • public acceptance of such products; • our ability to produce products of consistent quality that offer functionality comparable or superior to existing or new products; • our ability to produce products fit for their intended purpose; • our ability to produce new products or customizations of existing products to match changes in public demand; • our ability to timely obtain necessary regulatory approvals for our products; • the speed at which potential customers qualify our products for use in their products; • the pricing of our products compared to competitive and alternative products, including petroleum-based plastics; • the strategic reaction of companies that market competitive products; • our reliance on third parties who support or control distribution channels; and • general market conditions, including fluctuating demand for our products.
Market acceptance of our products will depend on numerous factors, many of which are outside of our control, including, among others: • public acceptance of such products; • our ability to produce products of consistent quality that offer functionality comparable or superior to existing or new products; • our ability to produce products fit for their intended purpose; • our ability to produce new products or customizations of existing products to match changes in public demand; • our ability to timely obtain necessary regulatory approvals for our products; • the speed at which potential customers qualify our products for use in their products; • the pricing of our products compared to competitive and alternative products, including petroleum-based plastics or incumbent HDPE and polypropylene closures, as well as similar products made by different methods such as PET closures made using injection or compression molding methods; • the strategic reaction of companies that market competitive products or have intellectual property rights that may be necessary to produce our products economically, effectively, or at all; • our reliance on third parties who support or control distribution channels; and • general market conditions, including fluctuating demand for our products.
In the ordinary course of our business, we may process proprietary, confidential, and sensitive data, including personal data, intellectual property, and trade secrets (collectively, sensitive information). Cyberattacks, malicious internet-based activity, and online and offline fraud are prevalent and continue to increase. These threats are becoming increasingly difficult to detect.
In the ordinary course of our business, we and the third parties with whom we work process proprietary, confidential, and sensitive data, including personal data, intellectual property, and trade secrets (collectively, sensitive information). Cyberattacks, malicious internet-based activity, and online and offline fraud are prevalent and continue to increase.
The loss of one or more of our significant customers, a substantial reduction in their orders, their failure to exercise customer options to enter into new offtake agreements or purchase commitments or to purchase product, their unwillingness to extend contractual deadlines if we fail to meet production, product, or specification requirements, their inability to perform under their contracts or a significant deterioration in their financial condition could harm our business, results of operations and financial condition.
Our business, results of operations, and financial condition may be harmed by the loss of one or more of our significant customers, a substantial reduction in their orders, their failure to enter into offtake agreements or purchase commitments that support necessary financing, or at all, or to purchase product, their unwillingness to extend contractual deadlines if we fail to meet production, product, or specification requirements, their inability to perform under their contracts or a significant deterioration in their financial condition.
If any analyst who may cover us were to cease coverage of us, which occurred in November 2023 and may occur again in the future, or if any analyst fails to regularly publish reports on us, we could lose in the financial markets, which could cause our stock price or trading volume to decline. 34 Future issuances of debt securities and equity securities may adversely affect us, including the market price of our Common Stock and may be dilutive to existing stockholders.
If any analyst who may cover us were to cease coverage of us, which occurred in November 2023 and may occur again in the future, or if any analyst fails to regularly publish reports on us, we could lose in the financial markets, which could cause our stock price or trading volume to decline.
The rate at which we incur losses may be higher in future periods as we: • develop our all-PET cap and closure business; • increase our spending on strategic partnerships; • begin production at our OM1 plant; • increase our sales and marketing activities; and • decide to expand our commercial production capabilities and incur costs associated with developing our plants.
The rate at which we incur losses may be higher in future periods as we: • develop our PET closure business; • increase our spending on strategic partnerships; • increase production at our Origin 1 plant; • increase our sales and marketing activities; and • expand our commercial production capabilities and incur costs associated with developing and commercializing our closures and furanics technologies.
Our commercial success may be influenced by the cost of our products relative to petroleum-based products. The cost of petroleum-based products is in part based on the price of petroleum, which is subject to historically fluctuating prices. Our production plans assume use of biomass feedstocks such as timber and forest residues, which historically have experienced low volatility relative to petroleum.
The cost of petroleum-based products is in part based on the price of petroleum, which is subject to historically fluctuating prices. Our furanics technology is designed to use biomass feedstocks such as timber and forest residues, which historically have experienced low volatility relative to petroleum.
If we are unable to accurately match the timing and quantities of raw material purchases to our actual needs or successfully implement inventory management and warehousing systems, we may incur unexpected production disruption, storage, transportation and write-off costs, which may harm our business and operating results.
If we are unable to accurately match the timing and quantities of raw material purchases to our actual needs or successfully implement inventory management and warehousing systems, we may incur unexpected production disruption, storage, transportation and write-off costs, which may harm our business and operating results. 18 Maintenance, expansion and refurbishment of our facilities, the construction of new facilities and production lines, and the development and implementation of new manufacturing processes involve significant risks.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe also use third-party service providers to assist us from time to time to identify, assess, and manage material risks from cybersecurity threats, including for example cybersecurity consultants, data backup and recovery providers, cyber insurers, and legal counsel.
Biggest changeWe also use third-party service providers to assist us from time to time to identify, assess, and manage material risks from cybersecurity threats, including for example cybersecurity consultants, data backup and recovery providers, cyber insurers, and legal counsel. 38 For a description of the risks from cybersecurity threats that may materially affect the Company and how they may do so, see our risk factors under Part 1.
Risk Factors in this Annual Report on Form 10-K. 37 Governance Our Board of Directors addresses the Company’s cybersecurity risk management as part of its general oversight function and has delegated to the Audit Committee primary responsibility for monitoring the Company’s cybersecurity risk management processes, including mitigation of cybersecurity threats.
Item 1A. Risk Factors in this Annual Report on Form 10-K. Governance Our Board of Directors (the "Board") addresses the Company’s cybersecurity risk management as part of its general oversight function and has delegated to the Audit Committee primary responsibility for monitoring the Company’s cybersecurity risk management processes, including mitigation of cybersecurity threats.
In particular, the Director of IT and General Counsel are responsible for hiring appropriate personnel, helping to integrate cybersecurity risk considerations into the Company’s overall risk management strategy, and communicating key priorities to relevant personnel, helping prepare for cybersecurity incidents, approving cybersecurity processes and technologies, and reviewing security assessments and other security-related reports.
In particular, the VP of Technology and Director of IT are responsible for hiring appropriate personnel and helping to integrate cybersecurity risk considerations into the Company’s overall risk management strategy, and communicating key priorities to relevant personnel, helping prepare for cybersecurity incidents, approving cybersecurity processes and technologies, and reviewing security assessments and other security-related reports.
The General Counsel, Director of IT, and relevant department heads work with our incident response team to help the Company mitigate and remediate cybersecurity incidents of which they are notified. The SIRP provides for escalation of potentially material cybersecurity incidents to the Audit Committee.
Our VP of Technology, Director of IT, General Counsel, and MSP, along with relevant department heads, work with our incident response team to help the Company mitigate and remediate cybersecurity incidents of which they are notified. The SIRP provides for escalation of potentially material cybersecurity incidents to the Audit Committee.
Assessment and management of material risks from cybersecurity threats are integrated into the Company’s overall risk management processes. For example, the Director of IT coordinates with our General Counsel and representatives of the Company’s departments and teams to evaluate the Company’s risk profile and identify and mitigate cybersecurity threats.
Assessment and management of material risks from cybersecurity threats are integrated into the Company’s overall risk management processes. For example, the Director of IT coordinates with our VP of Technology and representatives of the Company’s departments and teams to evaluate the Company’s risk profile and identify and mitigate cybersecurity threats.
The Director of IT and General Counsel are responsible for helping to identify, assess and manage the Company’s cybersecurity threats and risks by monitoring and evaluating our threat environment using, among other things, manual processes, automated tools, internal audits, threat and vulnerability assessments, evaluating threats reported to us, evaluating our and our industry’s risk profile, and subscribing to reports and services that identify cybersecurity threats.
Our VP of Technology and Director of IT, together with our managed service provider ("MSP"), are responsible for helping to identify, assess and manage the Company’s cybersecurity threats and risks by monitoring and evaluating our threat environment using, among other things, manual processes, automated tools, internal audits, threat and vulnerability assessments, evaluating threats reported to us, evaluating our and our industry’s risk profile, and subscribing to reports and services that identify cybersecurity threats.
Removed
For a description of the risks from cybersecurity threats that may materially affect the Company and how they may do so, see our risk factors under Part 1. Item 1A.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThis facility, Origin 1, is on approximately two acres of land and contains a construction trailer complete with approximately 15,476 square feet of office space. The land is owned and the offices are leased by our wholly owned subsidiary, Origin Materials Canada Pioneer Limited.
Biggest changeThis facility, Origin 1, is on approximately two acres of land and contains a construction trailer complete with approximately 5,402 square feet of office space. The land is owned by our wholly owned subsidiary, Origin Materials Canada Pioneer Limited and the offices are leased by our wholly owned subsidiary, Origin Materials Canada Polyesters Limited.
Item 2. Properties Our corporate headquarters, pilot-scale plant and research and development laboratories are located in West Sacramento, California, where we occupy approximately 41,443 square feet of office, plant and laboratory space. Our leases for this facility were amended in August 2023 and will expire on December 31, 2033.
Item 2. Properties Our corporate headquarters, pilot-scale plant and research and development laboratories are located in West Sacramento, California, where we occupy approximately 41,443 square feet of office, plant and laboratory space. Our leases for this facility will expire on December 31, 2033.
Removed
We completed the purchase of approximately 183 acres in Geismar, Louisiana for Origin 2 in third quarter 2022 in the amount of $8.5 million. Item 3. Legal Proceedings Not applicable. Item 4. Mine Safety Disclosures Not applicable. Part II
Added
We purchased of approximately 183 acres in Geismar, Louisiana in third quarter 2022 in the amount of $8.5 million. The Company has concluded it will not construct an Origin 2 plant on the land owned in Geismar during the third quarter of 2024. As such, the Company obtained the approval from the Board to sell the property.
Added
The property is currently listed for sale, and it is the Company's intention to complete the sale of the land within the next 12 months. Item 3. Legal Proceedings Please see Note 16 “Commitments and Contingencies” in the notes to the consolidated financial statements in Item 8 of this Annual Report, which is incorporated herein by reference. Item 4.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our Common Stock and Public Warrants are listed on NASDAQ under symbols “ORGN” and “ORGNW”, respectively. The following table sets forth the high and low sales price per share of our common stock as reported in the consolidated transaction reporting system.
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our Common Stock and Public Warrants are listed on NASDAQ under symbols “ORGN” and “ORGNW”, respectively.
The actual number of holders of our Common Stock and Public Warrants is greater than the number of record holders, and includes holders who are beneficial owners, but whose shares or warrants are held in street name by brokers or other nominees. 38 Dividend Policy We have never declared or paid any dividends and do not anticipate paying any dividends on our common stock in the foreseeable future.
The actual number of holders of our Common Stock and Public Warrants is greater than the number of record holders, and includes holders who are beneficial owners, but whose shares or warrants are held in street name by brokers or other nominees. 39 Dividend Policy We have never declared or paid any dividends and do not anticipate paying any dividends on our common stock in the foreseeable future.
Holders As of close of business on February 23, 2024, there were 37 holders of record of our Common Stock and 1 holder of record for our Public Warrants.
Holders As of close of business on March 7, 2025, there were 32 holders of record of our Common Stock and 1 holder of record for our Public Warrants.
Removed
Securities Authorized for Issuance Under Equity Compensation Plans Information about our equity compensation plans in Item 12 of Part III of this Annual Report is incorporated by reference to the information to be set forth in our Proxy Statement. Recent Sales of Unregistered Equity Securities None. Issuer Purchases of Equity Securities None. Item 6. Reserved 39
Added
Recent Sales of Unregistered Equity Securities None. Issuer Purchases of Equity Securities None. Item 6. Reserved 40

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeOn February 5, 2024, the parties entered into a memorandum of understanding by which they agreed that the counterparty would be released from its obligation to pay the remaining $2.5 million of the prepayment and that Legacy Origin would refund the first $2.5 million within a certain period after reporting in its Quarterly Report on Form 10-Q that its cash on hand has crossed a specified threshold. 46 Cash Flows for the year ended December 31, 2023 Compared to the year ended December 31, 2022 The following table shows a summary of cash flows for the year ended December 31, 2023 and 2022: Year ended December 31, (in thousands) 2023 2022 Net cash used in operating activities $ (60,355) $ (26,092) Net cash provided by investing activities 26,232 88,847 Net cash provided by financing activities 146 1,248 Effects of foreign exchange rate changes on the balance of cash and cash equivalents, and restricted cash held in foreign currencies 1,131 (2,782) Net (decrease) increase in cash and cash equivalents, and restricted cash $ (32,846) $ 61,221 Cash Used in Operating Activities Net cash used in operating activities for the year ended December 31, 2023 was $60.4 million.
Biggest changeOn February 5, 2024, the parties entered into a memorandum of understanding (“MOU”) by which they agreed that the counterparty would be released from its obligation to pay the remaining $2.5 million of the prepayment and that Legacy Origin would refund the first $2.5 million within a certain period after reporting in its Quarterly Report on Form 10-Q that its cash on hand has crossed a specified threshold.
Other Income (Expenses) Our other income (expenses) consists of income from governmental grant programs, interest expenses for notes payable and other liabilities, interest income on marketable securities, realized gain or loss on marketable securities, investment fee, and income or expenses related to changes in the fair value of derivative assets and liabilities.
Other Income (Expenses) Our other income (expenses) consists of income from governmental grant programs, interest expenses for notes payable and other liabilities, interest and investment income (expenses) on marketable securities, realized gain or loss on marketable securities, investment fee, and gain or loss related to changes in the fair value of derivative assets and liabilities.
On February 5, 2024, the parties to the prepayment agreement entered into a memorandum of understanding by which they agreed that the counterparty would be released from its obligation to pay the remaining $2.5 million of the prepayment and that Legacy Origin would refund the first $2.5 million within a certain period after reporting in its Quarterly Report on Form 10-Q that its cash on hand has crossed a specified threshold.
On February 5, 2024, the parties to the prepayment agreement entered into a memorandum of understanding ("MOU") by which they agreed that the counterparty would be released from its obligation to pay the remaining $2.5 million of the prepayment and that Legacy Origin would refund the first $2.5 million within a certain period after reporting in its Quarterly Report on Form 10-Q that its cash on hand has crossed a specified threshold.
Adjusted EBITDA We believe that the presentation of Adjusted EBITDA is appropriate to provide additional information to investors about our operating profitability adjusted for certain non-cash items, non-routine items that we do not expect to continue at the same level in the future, as well as other items that are not core to our operations.
Adjusted EBITDA We believe that the presentation of Adjusted EBITDA is appropriate to provide additional information to investors about our operating profitability adjusted for certain non-cash items, non-routine items that we do not expect to continue at the 45 same level in the future, as well as other items that are not core to our operations.
Upon commencement of commercial operations, we expect to expand our operations substantially, including in the United States and Canada, and as a result, we expect Origin’s future results to be sensitive to foreign currency transaction and translation risks and other financial risks that are not reflected in Origin’s historical financial statements.
Upon commencement of commercial operations, we expect to expand our operations substantially, including in the United States and Canada, and as a result, we expect our future results to be sensitive to foreign currency transaction and translation risks and other financial risks that are not reflected in our historical financial statements.
Components of Results of Operations We are in the early stages of recognizing revenue and our historical results may not be indicative of our future results for reasons that may be difficult to anticipate.
Components of Results of Operations We are in the relatively early stages of recognizing revenue and our historical results may not be indicative of our future results for reasons that may be difficult to anticipate.
Additionally, as of December 31, 2023, we had liability balances consisting of $3.5 million notes payable, long-term, $1.7 million notes payable, short-term, $0.8 million unpaid accrued interest recorded in other liabilities, current, 45 $5.7 million other liabilities, long-term with unpaid accrued interest and a $2.5 million customer prepayment recorded in other liabilities, long-term.
As of December 31, 2023, we had liability balances consisting of $3.5 million notes payable, long-term, $1.7 million notes payable, short-term, $0.8 million unpaid accrued interest recorded in other liabilities, current, $5.7 million other liabilities, long-term with unpaid accrued interest and a $2.5 million customer prepayment recorded in other liabilities, long-term.
Unless the context otherwise requires, references in this section to “Legacy Origin”, “Origin”, “the Company”, “we”, “us” and “our” refer to the business and operations of Legacy Origin and its consolidated subsidiaries prior to the Business Combination and to Origin Materials, Inc. and its consolidated subsidiaries, following the Closing.
Unless the context otherwise requires, references in this section to “Legacy Origin”, “Origin”, “the Company”, “we”, “us” and “our” refer to the business and operations of Legacy Origin and its consolidated subsidiaries prior to the Merger and to Origin Materials, Inc. and its consolidated subsidiaries, following the closing of the Merger.
In November 2016, Legacy Origin received a $5.0 million prepayment from a legacy stockholder for product from Origin 1 pursuant to an "Offtake Agreement," a type of agreement that generally provided for binding take-or-pay commitments to purchase certain annual volumes of product from our planned manufacturing facilities at specified prices, subject to satisfaction of certain conditions precedent.
In November 2016, Legacy Origin received a $5.0 million prepayment from a legacy stockholder for product from Origin 1 pursuant to an “Offtake Agreement,” a type of agreement that generally provided for binding take-or-pay commitments to purchase certain annual volumes of product from our planned manufacturing facilities at specified prices, subject to satisfaction of certain conditions precedent.
Origin and the customer agreed to work in good faith to execute an Offtake Agreement, the agreed terms of which are set forth in the prepayment agreement, whereby 100% of the prepayment will be applied against future purchases.
We and the customer agreed to work in good faith to execute an Offtake Agreement, the agreed terms of which are set forth in the prepayment agreement, whereby 100% of the prepayment will be applied against future purchases.
Income Tax Expenses Our income tax expenses consist of an estimate for U.S. federal, state, and foreign income taxes based on enacted rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in deferred tax assets and liabilities, and changes in the tax law.
Income Tax (Expenses) Benefits Our income tax (provision) benefit consist of an estimate for U.S. federal, state, and foreign income taxes based on enacted rates, as adjusted for allowable credits, deductions, uncertain tax positions, changes in deferred tax assets and liabilities, and changes in the tax law.
This measure is not a financial measure calculated in accordance with U.S. GAAP, and it should not be considered as a substitute for net income, operating income, or any other measure calculated in accordance with U.S. GAAP, and may not be comparable to similarly titled measures reported by other companies.
GAAP, and it should not be considered as a substitute for net income, operating income, or any other measure calculated in accordance with U.S. GAAP, and may not be comparable to similarly titled measures reported by other companies.
Recent Accounting Pronouncements See Note 3 to the consolidated financial statements in this Annual Report for more information about recent accounting pronouncements, the timing of their adoption, and our assessment, to the extent we have made one, of their potential impact on our financial condition and results of operations and cash flows.
Recent Accounting Pronouncements See Note 3 “Recent Accounting Pronouncements” to the consolidated financial statements in Item 8 of this Annual Report for more information about recent accounting pronouncements, the timing of their adoption, and our assessment, to the extent we have made one, of their potential impact on our financial condition and results of operations and cash flows.
Treasury money market funds and our marketable securities are primarily U.S. government and agency securities, corporate bonds, asset-backed securities, foreign government and agency securities, and municipal bonds. We recently began generating revenue from our business operations.
Treasury money market funds and our marketable securities are primarily U.S. government and agency securities, corporate bonds, asset-backed securities, foreign government and agency securities, and municipal bonds. We began generating revenue from our business operations in 2023.
The repayment in the amount of $2.7 million is due on September 1, 2024, $1.9 million is due on September 1, 2025, and $1.8 million is due on September 1, 2026 (inclusive of accrued but unpaid interest). However, the prepayment could be used to credit against the purchase of products over the term of the Offtake Agreement.
The remaining repayment in the amount of $1.9 million is due on September 1, 2025, and $1.8 million is due on September 1, 2026 (inclusive of accrued but unpaid interest). However, the prepayment could be used to credit against the purchase of products over the term of the Offtake Agreement.
We recognize revenue from the service agreements over the period during which the services are performed and recognize the associated costs as they are incurred. In general, we recognize revenue when, or as, our performance obligations under the terms of a contract with our customer are satisfied. The Company considers this is a critical accounting policy and estimate.
We recognize revenue from the service agreements over the period during which the services are performed and recognize the associated costs as they are incurred. In general, we recognize revenue when, or as, our performance obligations under the terms of a contract with our customer are satisfied. We consider this to be is a critical accounting policy and estimate.
The core principle of ASC 606 requires that an entity recognize revenue to depict the transfer of promised goods or service to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.
The core principle of ASC 606 requires that an entity recognize revenue to depict the transfer of promised goods or service to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services.
The note is collateralized substantially by Origin 1 and other assets of Origin Materials Canada Pioneer Limited. If repaid in cash, the note bears an annual interest rate of the three-month Secured Overnight Financing Rate (“SOFR”) plus 0.25% (5.61% at December 31, 2023) and matures five years from the commercial operation date of Origin 1.
The note is collateralized substantially by Origin 1 and other assets of Origin Materials Canada Pioneer Limited. If repaid in cash, the note bears an annual interest rate of the three-month Secured Overnight Financing Rate (“SOFR”) plus 0.25% (4.94% at December 31, 2024) and matures five years from the commercial operation date of Origin 1.
Gain in Fair Value of Earnout Liability The gain in fair value of earnout liability consists of the change in fair value of the future contingent equity shares related to the Business Combination. We recognize incremental income (expense) for the fair value adjustments of the outstanding liability at the end of each reporting period.
(Loss) Gain in Fair Value of Earnout Liability The (loss) gain in fair value of earnout liability consists of the change in fair value of the future contingent equity shares related to the Merger. We recognize incremental income (expense) for the fair value adjustments of the outstanding liability at the end of each reporting period.
We expect that our general and administrative expenses will continue to increase as we develop our all-PET cap and closure business, increase our spending on strategic partnerships, increase our sales and marketing activities, produce materials and operate as a public company.
We expect that our general and administrative expenses will continue to increase as we develop our PET closures business, increase our spending on strategic partnerships, increase our sales and marketing activities, produce materials and operate as a public company.
As our service agreements include customers that are not in similar geographic markets and for different services, therefore the Company uses the expected cost plus margin approach to estimate the stand-alone selling price for each of our performance obligations.
As our service agreements include customers that are not in similar geographic markets and for different services, therefore we use the expected cost plus margin approach to estimate 50 the stand-alone selling price for each of our performance obligations.
We have released the valuation allowance previously recorded against some of the foreign net deferred tax assets as we believe it is more likely than not they will be recovered. 42 Results of Operations Comparison of the year ended December 31, 2023 and 2022 The following table summarizes the Company’s results of operations with respect to the items set forth in such table for the year ended December 31, 2023 and 2022 together with the change in such items in dollars and as a percentage.
We have released the valuation allowance previously recorded against some of the foreign net deferred tax assets as we believe it is more likely than not they will be recovered. 43 Results of Operations Comparison of the years ended December 31, 2024 and 2023 The following table summarizes our results of operations with respect to the items set forth in such table for the years ended December 31, 2024 and 2023 together with the change in such items in dollars and as a percentage.
On August 1, 2022, Legacy Origin and the legacy stockholder amended the note to provide for repayment in three installments consisting both principal and interest of $2.7 million on September 1, 2024, $1.9 million on September 1, 2025, and $1.8 million on September 1, 2026 and to allow the legacy stockholder to offset amounts owed for the purchase of product from Legacy Origin’s Origin 1 facility against amounts due under the note.
On August 1, 2022, the Company and the legacy stockholder amended the promissory note to provide for repayment in three installments consisting of both principal and interest (at 3.5% per annum) of $2.7 million on September 1, 2024, $1.9 million on September 1, 2025, and $1.8 million on September 1, 2026 and to allow the legacy stockholder to offset amounts owed for the purchase of product from Legacy Origin’s Origin 1 facility against amounts due under the promissory note.
At December 31, 2023, the outstanding note principal balance was $5.2 million of which $3.5 million was included in notes payable, long-term and $1.7 million was included in notes payable, short-term and the outstanding accrued interest of $0.8 million was included in other liabilities, current.
At December 31, 2024 the outstanding note principal balance was $3.5 million of which $1.7 million was included in notes payable, long-term and $1.8 million was included in notes payable, short-term and the outstanding accrued interest of less than $0.1 million was included in other liabilities, current.
The prepayment agreement provides the customer a capacity reservation of up to a specified annual volume of product from Origin 1 for a term of ten years, pursuant to the terms of an Offtake Agreement. At December 31, 2023 and 2022, the total amount outstanding on this agreement was $2.5 million was recorded in other liabilities, long-term.
The prepayment agreement provides the customer a capacity reservation of up to a specified annual volume of product from Origin 1 for a term of ten years, pursuant to the terms of an Offtake Agreement. At December 31, 2024 and 2023, the total amount outstanding on this agreement was $2.5 million.
In addition to our cash on hand, we anticipate that we will need substantial additional project financing, including from strategic partners, and government incentives to meet our financial projections, execute our growth strategy and expand our manufacturing capability. We anticipate that we will also enter into additional strategic partnerships to finance the construction of our Origin 2 plant.
In addition to our cash on hand, we anticipate that we will need substantial additional project financing, including from strategic partners, and government incentives to meet our financial projections, execute our growth strategy and expand our manufacturing capability. We may also enter into additional strategic partnerships to finance the development of closures manufacturing lines.
In February 2024, Legacy Origin and the customer amended the agreement to provide for repayment in three installments consisting of approximately $2.2 million on March 1, 2024, $1.6 million on September 1, 2024, and $2.1 million on March 1, 2025 instead of applying a credit to product purchases under the Offtake Agreement.
In February 2024, the Company and the legacy stockholder amended the agreement to provide for repayment with interest accrual in three installments consisting of approximately $2.2 million on March 1, 2024, $1.6 million on September 1, 2024, and $2.1 million on March 1, 2025 instead of applying a credit to product purchases under the Offtake Agreement.
Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in the sections titled “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” as set forth elsewhere in this Annual Report.
This discussion may contain forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in the sections titled “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” as set forth elsewhere in this Annual Report.
Our ability to obtain financing for the construction of future plants may depend in part on our ability to first enter into customer agreements sufficient to demonstrate adequate demand to justify the construction of such plants.
Our ability to obtain financing for the construction of future Origin manufacturing facilities may depend in part on our ability to first enter into customer agreements sufficient to demonstrate adequate demand to justify the capital expenditure.
For additional information regarding this repayment, see Note 11- Other Liabilities, Long-term to the consolidated financial statements in Item 8 of this Annual Report • Furthermore, the Company has a prepayment agreement with a counterparty with $2.5 million due within 30 days of the customer confirming that a sample from Origin 1 meets the customer’s specifications.
For additional information regarding this repayment, see Note 7 “Notes Payable” to the consolidated financial statements in Item 8 of this Annual Report. • We have a prepayment agreement with a counterparty for $2.5 million due within 30 days of the customer confirming that a sample from Origin 1 meets the customer’s specifications.
Gain (Loss) in fair value of derivatives, common stock warrants liability, and earnout liability The Company recognized an aggregate gain related to the gain (loss) in fair values of derivatives, common stock warrants liability, and earnout liability of $70.6 million during year ended December 31, 2023 compared to an aggregate gain of $107.0 million during 2022.
Changes in Fair Value of Derivatives, Common Stock Warrants Liability, and Earnout Liability We recognized an aggregate loss related to the changes in fair values of derivative, common stock warrant liability, and earnout liability of $3.6 million during the year ended December 31, 2024 compared to an aggregate gain of $70.6 million in 2023.
We believe that our performance and future success depend on several factors that present significant opportunities for us but also pose risks and challenges, including those discussed below and under “Risk Factors ” appearing elsewhere in this Annual Report.
Key Factors and Trends Affecting Our Operating Results We are in the early stages of generating revenue. We believe that our performance and future success depend on several factors that present significant opportunities for us but also pose risks and challenges, including those discussed below and under “Risk Factors ” appearing elsewhere in this Annual Report.
Indebtedness As of December 31, 2023 and 2022, we had $7.3 million and $7.2 million of indebtedness under a Canadian government program, respectively, of which zero and $0.8 million was received during the year ended December 31, 2023 and 2022, respectively.
Indebtedness As of December 31, 2024 and 2023, we had $14.4 million and $7.3 million of indebtedness under a Canadian government program, respectively, of which $8.1 million and zero was received during the years ended December 31, 2024 and 2023, respectively.
As of December 31, 2022, we had liability balances consisting of $5.8 million notes payable with unpaid accrued interest, $5.4 million other liabilities, long-term with unpaid accrued interest and a $2.5 million customer prepayment recorded in other liabilities, long-term.
Additionally, as of December 31, 2024, we had liability balances consisting of $1.7 million notes payable, long-term, $3.8 million notes payable, short-term, $0.1 million unpaid accrued interest recorded in other liabilities, current, and a $2.5 million customer prepayment recorded in other liabilities, current.
These adjustments were partially offset by additions for non-cash charges of $9.4 million for stock-based compensation and $3.4 million for depreciation and amortization, as well as $5.9 million for the increase in accrued expenses. Net cash used in operating activities for the year ended December 31, 2022 was $26.1 million.
These adjustments were partially offset by additions for non-cash charges of $9.4 million for stock-based compensation and $3.4 million for depreciation and amortization, as well as $5.9 million for the increase in accrued expenses.
Our future capital requirements will depend on many factors, including actual construction costs of the Origin 2 plant and the operation cost of Origin 1, changes in the costs in our supply chain, expanded operating activities and our ability to secure customers.
Our future capital requirements will depend on many factors, including actual costs of our manufacturing lines or plants, changes in the costs in our supply chain, expanded operating activities and our ability to secure customers.
Our ability to successfully develop the products, commence commercial operations and expand the business will depend on many factors, including our ability to meet the working capital needs, the availability of equity or debt financing and, over time, our ability to generate cash flows from operations.
Our ability to successfully develop the products, commence commercial operations and expand the business will depend on many factors, including our ability to meet the working capital needs, the availability of equity or debt financing and, over time, our ability to generate cash flows from operations. 46 We will require a significant amount of cash for capital expenditures as we invest in manufacturing lines for our PET closures business.
The repayment amount including both principal and accrued interest of $2.2 million is due on March 1, 2024, $1.6 million is due on September 1, 2024, and $2.1 million is due on March 1, 2025. Unlike the repayment agreement above, this prepayment cannot be used to credit against the purchase of products.
We paid the first two installments, and the remaining repayment amount, including both principal and accrued interest of $2.1 million, is due on March 1, 2025. Unlike the repayment agreement above, this prepayment cannot be repaid by means of a credit against the purchase of products.
At December 31, 2022, the note principal balance was $5.2 million with outstanding accrued interest of $0.6 million. Prepayments In November 2016, Legacy Origin received a $5.0 million prepayment from a legacy stockholder for product from Origin 1 pursuant to an Offtake Agreement.
At December 31, 2023, the outstanding note principal balance was $5.2 million of which $3.5 million was included in notes payable, long-term and $1.7 million was included in notes payable, short-term and the outstanding accrued interest of $0.8 million was included in other liabilities, current. 47 In November 2016, Legacy Origin received a $5.0 million prepayment from a legacy stockholder for product from Origin 1 pursuant to an Offtake Agreement.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Overview Origin is an innovative materials company with a mission to enable the world’s transition to sustainable materials.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Overview Origin is a technology company with a mission to enable the world’s transition to sustainable materials. Our innovations include PET closures for an estimated global closures market opportunity of greater than $65 billion.
We have developed a proprietary biomass conversion technology to convert biomass, or plant-based carbon, into the versatile “building block” chemicals CMF and hydrothermal carbon (“HTC”), which we collectively refer to as Furanic Intermediates, as well as oils and extractives and other co-products.
These include our proprietary technology for transforming biomass, or plant-based carbon, into versatile intermediate chemicals. These intermediate chemicals include CMF and HTC, which we collectively refer to as Furanic Intermediates, as well as oils and extractives and other co-products.
Adjusted EBITDA is also frequently used by analysts, investors, and other interested parties to evaluate companies in our industry, when considered alongside other U.S. GAAP measures. We use Adjusted EBITDA to supplement U.S. GAAP measures of performance to evaluate the effectiveness of our business strategies, make budgeting decisions and compare our performance against that of other companies using similar measures.
Adjusted EBITDA is a key metric used by management and our board to assess our financial performance. Adjusted EBITDA is also frequently used by analysts, investors, and other interested parties to evaluate companies in our industry, when considered alongside other U.S. GAAP measures. We use Adjusted EBITDA to supplement U.S.
For additional information regarding our 47 operating lease liabilities, see Note 17-Leases to the consolidated financial statements in Item 8 of this Annual Report. • In the near-term, the Company also expects to make payments related to the repayment agreement associated with the notes payable.
Operating lease liabilities of $0.3 million are short term and the remaining $3.9 million is long-term. For additional information regarding our operating lease liabilities, see Note 15 “Leases” to the consolidated financial statements in Item 8 of this Annual Report. • In the near-term, we anticipate making payments related to the repayment agreement associated with the notes payable.
We have also developed other products that can enhance sustainability, such as our 100% polyethylene terephthalate (“PET”) circular caps and closures that can enable fully-recyclable PET beverage containers and reduce waste through light-weighting, while providing enhanced performance such as greater oxygen and CO2 barrier properties that can increase shelf-life. These products complement our biomass conversion technology.
Our PET closures enable fully-recyclable PET beverage containers and reduce waste through light-weighting, while providing enhanced performance such as greater oxygen and CO 2 barrier properties that can increase shelf-life.
Liquidity and Capital Resources Sources of Liquidity Since inception, we have financed our operations principally from the sales and issuances of common stock, and governmental grant programs. Origin had $158.3 million in cash, cash equivalents, and marketable securities as of December 31, 2023. Our cash equivalents are invested primarily in U.S.
Liquidity and Capital Resources Sources of Liquidity Since inception, we have financed our operations principally from the sales and issuances of common stock, and governmental grant programs.
The increase in revenue is primarily attributable to our supply chain activation program. The Company did not recognize any revenue prior to 2023. Cost of Revenues Cost of revenues increased $23.6 million during the year ended December 31, 2023 compared to 2022. The increase is primarily attributable to the purchases associated with the Company’s supply chain activation program.
Cost of Revenues Cost of revenues increased $7.3 million, or 31%, during the year ended December 31, 2024 compared to 2023. The increase is primarily attributable to the purchases associated with our supply chain activation program. Research and Development Expenses Research and development expenses decreased $2.8 million, or (13)%, during the year ended December 31, 2024 compared to 2023.
We define Adjusted EBITDA as net income or loss adjusted for certain non-cash and non-recurring items, including (i) stock-based compensation expense, (ii) depreciation and amortization, (iii) interest income, (iv)interest expenses, (v) change in fair value of derivative, (vi) change in fair value of common stock warrants liability, (vii) change in fair value of earnout liability, (viii) other income, net, (ix) income tax benefits, and (x) cash severance. 44 Year ended December 31, (in thousands) 2023 2022 Net income $ 23,798 $ 78,569 Stock based compensation (1) 9,400 7,235 Depreciation and amortization 3,363 711 Interest income (6,303) (8,825) Interest expenses 131 — (Gain) loss in fair value of derivatives (69) 443 Gain in fair value of common stock warrants liability (29,531) (21,988) Gain in fair value of earnout liability (40,983) (85,437) Other income, net (838) (1,709) Income tax benefits (1,087) — Cash severance (1) 484 — Adjusted EBITDA $ (41,635) $ (31,001) (1) Please see Note 15- Stockholder's Equity to the consolidated financial statements in Item 8 of this Annual Report for further details.
Reconciliation of GAAP net loss to non-GAAP adjusted EBITDA Year ended December 31, (in thousands) 2024 2023 Net (loss) income $ (83,697) $ 23,798 Stock-based compensation (1) 10,080 9,400 Depreciation and amortization 10,715 3,363 Impairment of assets 15,246 — Investment income (6,783) (6,303) Interest expenses 371 131 Gain in fair value of derivatives (290) (69) Loss (gain) in fair value of common stock warrants liability 3,225 (29,531) Loss (gain) in fair value of earnout liability 703 (40,983) Other expenses (income), net 939 (838) Income tax provision (benefit) 669 (1,087) Cash severance (1) 455 484 Adjusted EBITDA $ (48,367) $ (41,635) (1) Please see Note 12- “Stockholder's Equity” to the consolidated financial statements in Item 8 of this Annual Report for further details.
The decrease in the gain related to the change in fair value of earnout liability of $44.4 million is the result of the revaluation of the earnout liability with the fair value of such liability decreasing less in 2023 as compared to 2022.
The aggregate loss related to the change in fair values decreased $74.2 million. The decrease related to the change in fair value of earnout liability of $41.7 million is the result of the revaluation of the earnout liability with the fair value of such liability increasing during the year ended December 31, 2024 as compared to decreasing in 2023.
At December 31, 2023 and December 31, 2022 the total amount outstanding was $5.1 million plus accrued interest of $0.6 million and $0.3 million, respectively, was recorded in other liabilities, long-term. In September 2019, Legacy Origin entered into a $5.0 million prepayment agreement with a counterparty for the purchase of products from Origin 2.
Prepayments In September 2019, Legacy Origin entered into a $5.0 million prepayment agreement with a counterparty for the purchase of products from Origin 2.
General and Administrative Expenses General and administrative expenses consist primarily of personnel-related costs, including stock-based compensation and professional fees, including, the costs of accounting, audit, legal, regulatory and tax compliance. 41 Gain in Fair Value of Common Stock Warrants Liability The gain in fair value of common stock warrants liability consists of the change in fair value of the Warrants (the Public Warrants together with the Private Placement Warrants, the “Common Stock Warrants” or “Warrants”).
(Loss) Gain in Fair Value of Common Stock Warrants Liability The (loss) gain in fair value of common stock warrants liability consists of the change in fair value of the Warrants (the Public Warrants together with the Private Placement Warrants, the “Common Stock Warrants” or “Warrants”).
These market dynamics, which we expect will continue into the foreseeable future, have and may continue to impact our business and financial results, including costs and revenues. We believe demand for our products, which our signed offtake agreements and capacity reservations have shown to be strong and broad based, is likely to continue to exceed supply for the foreseeable future.
In addition, several companies have announced products that may compete with our PET closures and biomass-derived chemicals and materials. These market dynamics, which we expect will continue into the foreseeable future, have and may continue to impact our business and financial results, including costs and revenues. Historically, demand for PET closures has been strong.
These adjustments were partially offset by additions for non-cash charges of $7.2 million for stock-based compensation and $0.7 million for depreciation and amortization. Cash Provided by Investing Activities Net cash provided by investing activities was $26.2 million for the year ended December 31, 2023, compared to net cash provided by investing activities of $88.8 million in 2022.
Cash Provided by Investing Activities Net cash provided by investing activities was $28.6 million for the year ended December 31, 2024, compared to net cash provided by investing activities of $26.2 million over the same period in 2023.
The $7.5 million increase in the gain from change in fair value of common stock warrants liability is the result of a larger decrease in the underlying fair value of common stock warrants in 2023 as compared to 2022. The fair values are driven by the value of the Company’s stock price.
The $32.8 million decrease related to the change in fair value of common stock warrant liability is the result of an increase in the fair value of the common stock warrants during the year ended December 31, 2024 as compared to a decrease in 2023.
Material Cash Requirements from Known Contractual and Other Obligations Our material cash requirements from known contractual and other obligations as of December 31, 2023, consisted of: • The operating cost of Origin 1 and project development cost of Origin 2, plus the ongoing operating loss of the Company is expected to be funded through a combination of Company cash and marketable securities in addition to substantial project financing and government incentives.
For additional information regarding this repayment, see Note 8 “Other Liabilities” to the consolidated financial statements in Item 8 of this Annual Report. • The operating cost of Origin 1 and our ongoing operating loss are expected to be funded through a combination of Company cash and marketable securities in addition to substantial project financing and government incentives.
For additional information regarding this repayment, see Note 11- Other Liabilities, Long-term to the consolidated financial statements in Item 8 of this Annual Report. Critical Accounting Policies and Estimates Our financial statements have been prepared in accordance with U.S. GAAP.
Critical Accounting Policies and Estimates Our financial statements have been prepared in accordance with U.S. GAAP.
Year Ended December 31, (in thousands) 2023 2022 Variance $ Variance % Revenues: Products $ 23,896 $ — $ 23,896 NA Services 4,909 — 4,909 NA Total revenues 28,805 — 28,805 NA Cost of revenues (exclusive of depreciation and amortization shown separately below) 23,591 — 23,591 NA Operating expenses Research and development 21,351 14,141 7,210 51 % General and administrative 35,382 24,095 11,287 47 % Depreciation and amortization 3,363 711 2,652 373 % Total operating expenses 60,096 38,947 21,149 54 % Loss from operations (54,882) (38,947) (15,935) 41 % Other income (expenses) Interest income 6,303 8,825 (2,522) (29) % Interest expenses (131) — (131) NA Gain (loss) in fair value of derivatives 69 (443) 512 (116) % Gain in fair value of common stock warrants liability 29,531 21,988 7,543 34 % Gain in fair value of earnout liability 40,983 85,437 (44,454) (52) % Other income, net 838 1,709 (871) (51) % Total other income, net 77,593 117,516 (39,923) (34) % Income before income tax benefits $ 22,711 $ 78,569 $ (55,858) (71) % Revenues Revenues increased $28.8 million during the year ended December 31, 2023 compared to 2022.
Year Ended December 31, (in thousands) 2024 2023 Variance $ Variance % Revenues: Products $ 31,279 $ 23,896 $ 7,383 31 % Services 3 4,909 (4,906) (100) % Total revenues 31,282 28,805 2,477 9 % Cost of revenues (exclusive of depreciation and amortization shown separately below) 30,864 23,591 7,273 31 % Operating expenses: Research and development 18,554 21,351 (2,797) (13) % General and administrative 40,766 35,382 5,384 15 % Depreciation and amortization 10,715 3,363 7,352 219 % Impairment of assets 15,246 — 15,246 100 % Total operating expenses 85,281 60,096 25,185 42 % Loss from operations (84,863) (54,882) (29,981) 55 % Other income (expenses): Investment income 6,783 6,303 480 8 % Interest expenses (371) (131) (240) 183 % Gain in fair value of derivatives 290 69 221 320 % (Loss) gain in fair value of common stock warrants liability (3,225) 29,531 (32,756) (111) % (Loss) gain in fair value of earnout liability (703) 40,983 (41,686) (102) % Other (expenses) income, net (939) 838 (1,777) (212) % Total other income, net 1,835 77,593 (75,758) (98) % (Loss) income before income tax (provision) benefit (83,028) 22,711 (105,739) (466) % Income tax (provision) benefit (669) 1,087 (1,756) (162) % Net (loss) income $ (83,697) $ 23,798 $ (107,495) (452) % Revenues Revenues increased $2.5 million, or 9%, during the year ended December 31, 2024 compared to 2023.
In addition to any lingering economic impacts of the COVID-19 pandemic, we have observed market uncertainty, civil unrest, global sanctions resulting from geopolitical conflicts, bank failures, increasing inflationary pressures, supply constraints and labor shortages in the past few quarters.
We continue to observe market uncertainty, civil unrest, global sanctions, bank failures, inflationary pressures, supply constraints and labor shortages in the past few quarters, and the potential changes in tariffs and trade barriers on major trading partners of the US including Canada and Mexico.
Our significant accounting policies are described in Note 2 to our consolidated financial statements included elsewhere in this Annual Report. We have the critical accounting policies and estimates which are described below. Earnout Liability The Company has recorded an earnout liability related to future contingent equity shares related to the Business Combination.
Our significant accounting policies are described in Note 2 “Summary of Significant Accounting Policies” to our consolidated financial statements included in Item 8 of this Annual Report. We have the critical accounting policies and estimates which are described below. Revenue Recognition We recognize revenue in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”) .
The increase of $0.5 million in the gain from change in fair value of derivative liabilities was associated with our foreign currency exchange purchases or sales. Non-GAAP Measures To provide investors with additional information in connection with our results as determined in accordance with U.S.
The movement in these instruments’ fair values are driven by the value of our stock price. This decrease was offset by the increase of $0.3 million in the gain from change in fair value of derivative associated with our foreign currency exchange purchases or sales.
For additional information regarding this repayment, see Note 10- Notes Payable to the consolidated financial statements in Item 8 of this Annual Report. • Additionally, the Company is anticipated to make payment related to the amended repayment agreements associated with the prepayment recorded in the other liabilities, long-term.
For additional information regarding this repayment, see Note 7 “Notes Payable” to the consolidated financial statements in Item 8 of this Annual Report. • We amended the agreement with another customer in February 2024 to provide for repayment in three installments.
We also expect to secure funding for plant construction under potential collaborations, strategic alliances or marketing, distribution or licensing arrangements or debt financings, which have not yet been secured. • Operating lease liabilities that are included in our consolidated balance sheets consists of future non-cancelable minimum rental payments under operating leases for our office space, research and development space, and leases of various office equipment, warehouse space, and temporary fencing.
Material Cash Requirements from Known Contractual and Other Obligations Our material cash requirements from known contractual and other obligations as of December 31, 2024 consisted of: • Operating lease liabilities that are included on our consolidated balance sheets consists of future non-cancelable minimum rental payments under operating leases for our office space, research and development space, and leases of various office equipment, and warehouse space.
We believe that products made using Origin’s biomass conversion technology at commercial scales can compete directly with petroleum-derived products on both performance and price while being sustainable.
We believe that products made using our furanics technology at sufficient scale and maturity can compete directly with petroleum-derived products on both performance and price while being sustainable and lowering the carbon footprint. The following discussion and analysis should be read in conjunction with our consolidated financial statements and the related notes appearing elsewhere in this Annual Report.
Our research and development expenses also include personnel-related costs like stock-based compensation and professional fees, investments associated with the operations of the Origin 1 plant and planning and project development of the Origin 2 plant, including the material and supplies to support product development and process engineering efforts.
Our research and development expenses also include personnel-related costs like stock-based compensation and professional fees. 42 General and Administrative Expenses General and administrative expenses consist primarily of personnel-related costs, including stock-based compensation and professional fees, including, the costs of accounting, audit, legal, regulatory and tax compliance.
For additional information regarding an earnout liability, see Note 12- Earnout Liability to the consolidated financial statements in Item 8 of this Annual Report. 48 Revenue Recognition The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers (“ASC 606”) .
The increase in product revenue is primarily generated by our supply chain activation program. For additional information regarding our supply chain activation program, see Note 4 - Revenues to the consolidated financial statements in Item 8 of this Annual Report.
GAAP, we disclose Adjusted Earnings before Interest, Taxes, Depreciation, and Amortization (“Adjusted EBITDA”) as a non-GAAP measure. Adjusted EBITDA is a key metric used by management and our board of directors (the “Board”) to assess our financial performance.
The increase is driven by the tax on income generated by the Canadian entities as a result of the establishment of intercompany transfer pricing. Non-GAAP Measures To provide investors with additional information in connection with our results as determined in accordance with U.S. GAAP, we disclose Adjusted Earnings before Interest, Taxes, Depreciation, and Amortization (“Adjusted EBITDA”) as a non-GAAP measure.
The increased net purchases of marketable securities of $13.5 million, offset by a decrease in maturities of marketable securities of $22.9 million in 2023 as compared to 2022.
These adjustments were offset by the increase in net purchases of marketable securities of $44.7 million and the decrease in maturities of marketable securities of $54.1 million.
We have pioneered a technology that has the potential to replace petroleum-based materials with decarbonized materials in a wide range of end products, such as food and beverage packaging, clothing, textiles, plastics, car parts, carpeting, tires, adhesives, soil amendments, fuels, and more.
Our furanics technologies include our furanics platform for transforming carbon into sustainable materials for a wide range of end products capable of addressing an estimated $1 trillion market opportunity, including food and beverage packaging, clothing, textiles, plastics, car parts, carpeting, tires, adhesives, soil amendments, and fuels.
The increase is mainly driven by the completion of Origin 1 during fourth quarter when we moved the assets from construction in process to the proper categories and began depreciating. Interest income Interest income decreased $2.5 million, or (29)%, in 2023 compared to 2022. The decrease is mainly driven by the amortization of premiums and discounts on marketable securities.
The increase is mainly driven by the completion of Origin 1 during the fourth quarter of 2023. Impairment of Assets Impairment of assets increased $15.2 million, or 100%, during the year ended December 31, 2024 compared to 2023.
Non-cash income recognized for the $85.4 million change in the fair value of earnout liability and $22.0 million for the change in fair value of common stock warrants liability were deducted from net income of $78.6 million, in addition to the $1.7 million increase in accounts and other receivables and the $5.0 million increase in other long-term assets.
Non-cash expenses recognized that were added back to the net loss of $83.7 million include $15.2 million impairment loss, $10.7 million depreciation and amortization, $10.1 million stock-based compensation and $3.2 million change in fair value of common stock warrants liability.
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Our biomass conversion technology can convert sustainable feedstocks such as sustainably harvested wood residues, agricultural waste, wood waste, and even corrugated cardboard into materials and products that are currently made from fossil feedstocks such as petroleum and natural gas.
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Our PET closures and technologies for producing them reflect our mission to enable the world's transition to sustainable materials, as well as our polymer expertise and platform development capability. We are going to market with what we believe is the first commercially viable PET closure.
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The ability of our technology to use sustainable feedstocks that are not used in food production differentiates our technology from other sustainable materials companies that are limited to feedstocks used in food production such as vegetable oils or high fructose corn syrup and other sugars.
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We anticipate that our PET closure solutions can be transformative for packaging by designing for recycling circularity and improving the performance and sustainability of packaging. Our product candidate for markets include the PCO 1881 compliant PET closure and a tethered PET closure designed to comply with European cap tethering mandates and keep caps connected to bottles.
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Due to abundant and renewable wood supplies that have historically stable pricing, our cost of production when using these feedstocks is expected to be more stable than potential competing platforms that use other types of feedstocks.
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Our first Origin CapFormer System, a PET closure manufacturing system, successfully completed its FAT, which involves a series of tests performed on the system to ensure that the system meets the requirements and functions as intended, in September 2024.
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We believe that end products made at commercial scale using our biomass conversion technology and wood feedstocks will have a significant unit cost advantage over products made from other low carbon feedstocks.
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Since September 2024, our CapFormer System has produced caps for commercial qualification and has been delivered to our operations and manufacturing center in Reed City, Michigan, where it commenced commercial production in February 2025. We anticipate bringing online additional CapFormer Systems as part of our scale-up strategy.
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At commercial scale, our biomass conversion technology with wood feedstocks is expected to be able to produce CMF and HTC with a negative carbon footprint. We believe these chemicals can replace petroleum-based inputs, lowering the carbon footprint of a wide range of materials without increasing cost or sacrificing performance.
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In February 2025, we announced that three new CapFormer lines were nearing completion, with eight total lines expected by December 2025. In addition to our closures business, we have developed a number of technologies related to furanics, a class of chemicals with properties enabling the production of widespread and valuable materials, like plastics.
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The following discussion and analysis should be read in conjunction with our consolidated financial statements and the related notes appearing elsewhere in this Annual Report. This discussion may contain forward-looking statements based upon current expectations that involve risks and uncertainties.

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