Origin Materials, Inc.ORGN
Origin Materials, Inc. Fair Value Disclosure
Fair Value Measurement
The Company’s financial assets and liabilities subject to fair value measurements on a recurring basis and the level of inputs used for such measurements were as follows:
Fair Value as of December 31, 2024 | |||||||||||||||||||||||
| (in thousands) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Cash equivalents | $ | 46,953 | $ | — | $ | — | $ | 46,953 | |||||||||||||||
| Marketable securities | — | 46,613 | — | 46,613 | |||||||||||||||||||
| Derivative asset | — | 15 | — | 15 | |||||||||||||||||||
| Total fair value | $ | 46,953 | $ | 46,628 | $ | — | $ | 93,581 | |||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Common stock warrants (Public) | $ | 3,108 | $ | — | $ | — | $ | 3,108 | |||||||||||||||
| Common stock warrants (Private Placement) | — | 1,458 | — | 1,458 | |||||||||||||||||||
| Earnout liability | — | — | 2,486 | 2,486 | |||||||||||||||||||
| Total fair value | $ | 3,108 | $ | 1,458 | $ | 2,486 | $ | 7,052 | |||||||||||||||
Fair Value as of December 31, 2023 | |||||||||||||||||||||||
| (in thousands) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||
| Assets: | |||||||||||||||||||||||
| Cash and cash equivalents | $ | 75,502 | $ | — | $ | — | $ | 75,502 | |||||||||||||||
| Marketable securities | — | 82,761 | — | 82,761 | |||||||||||||||||||
| Total fair value | $ | 75,502 | $ | 82,761 | $ | — | $ | 158,263 | |||||||||||||||
| Liabilities: | |||||||||||||||||||||||
| Common stock warrants (Public) | $ | 913 | $ | — | $ | — | $ | 913 | |||||||||||||||
| Common stock warrants (Private Placement) | — | 428 | — | 428 | |||||||||||||||||||
| Earnout liability | — | — | 1,783 | 1,783 | |||||||||||||||||||
| Derivative liability | — | 300 | — | 300 | |||||||||||||||||||
| Total fair value | $ | 913 | $ | 728 | $ | 1,783 | $ | 3,424 | |||||||||||||||
The Company performs routine procedures such as comparing prices obtained from independent sources to ensure that appropriate fair values are recorded. The cash equivalents and Public Warrants are categorized as Level 1 instruments as the fair value was determined based on the unadjusted quoted prices are available in active markets for identical assets or liabilities as of the reporting date. The marketable securities, derivative asset and derivative liability are categorized as Level 2 instruments as the estimated fair value was determined based on the estimated or actual bids and offers of the marketable securities in an over-the-counter market on the last business day of the year. The Private Placement Warrants are classified within Level 2 because the transfer of Private Placement Warrants to anyone outside of certain permitted transferees of Artius Acquisition Partners LLC (the “Sponsor”) would result in the Private Placement Warrants having substantially the same terms as the Public Warrants, the Company determined that the fair value of each Private Placement Warrant is consistent with that of a Public Warrant. Accordingly, the Private Placement Warrants are classified as Level 2 financial instruments.
The value of the earnout liability is classified as Level 3 measurements under the fair value hierarchy, as these liabilities have been valued based on significant inputs not observable in the market (see Note 9 for additional details). A loss of $0.7 million and a gain of $41.0 million for the years ended December 31, 2024 and 2023, respectively, was recorded on the consolidated statements of operations and comprehensive (loss) income in the (loss) gain in fair value of earnout liability.
The following table summarizes the activities for the earnout liability for the years ended:
| (in thousands) | December 31, 2024 | December 31, 2023 | |||||||||
| Balance at beginning of year | $ | 1,783 | $ | 42,533 | |||||||
| Loss (gain) in fair value of earnout liability | 703 | (40,983) | |||||||||
| Other | — | 233 | |||||||||
| Balance at end of year | $ | 2,486 | $ | 1,783 | |||||||
As of December 31, 2024 and 2023, the carrying values of accounts receivable and unbilled receivable, other receivables, accounts payable, and accrued expenses approximate their respective fair values due to their short-term nature. We have determined the fair value of notes payable and Canadian government research and development program liability approximates the carrying value due to the standard terms of the arrangement including but not limited to the amount borrowed, the term, and the interest rate.
Marketable Securities
The Company’s marketable securities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. Amortized cost net of unrealized gain (loss) is equal to fair value. The following table summarizes the marketable securities by major security type as follows:
As of December 31, 2024 | |||||||||||||||||||||||
| (in thousands) | Amortized Cost | Unrealized Gains | Unrealized Losses | Fair Value | |||||||||||||||||||
| Corporate bonds | $ | 3,741 | $ | 30 | $ | — | $ | 3,771 | |||||||||||||||
| Asset-backed securities | 36,309 | 39 | (1,349) | 34,999 | |||||||||||||||||||
| U.S. government and agency securities | 7,829 | 14 | — | 7,843 | |||||||||||||||||||
| Total marketable securities | $ | 47,879 | $ | 83 | $ | (1,349) | $ | 46,613 | |||||||||||||||
As of December 31, 2023 | |||||||||||||||||||||||
| (in thousands) | Amortized Cost | Unrealized Gains | Unrealized Losses | Fair Value | |||||||||||||||||||
| Corporate bonds | $ | 21,869 | $ | 26 | $ | (847) | $ | 21,048 | |||||||||||||||
| Asset-backed securities | 52,199 | 26 | (2,289) | 49,936 | |||||||||||||||||||
| U.S. government and agency securities | 11,706 | — | (270) | 11,436 | |||||||||||||||||||
| Foreign government and agency securities | 372 | — | (31) | 341 | |||||||||||||||||||
| Total marketable securities | $ | 86,146 | $ | 52 | $ | (3,437) | $ | 82,761 | |||||||||||||||
The realized gains and losses are included in other (expenses) income, net in the consolidated statements of operations and comprehensive (loss) income.
We sold marketable securities for proceeds of $1,751.5 million and $3,605.2 million for the years ended December 31, 2024 and 2023, respectively. As a result of those sales, we realized a loss of $0.9 million and a gain of $1.0 million for the years ended December 31, 2024 and 2023, respectively. We regularly review our available-for-sale marketable securities in an unrealized loss position and evaluate the current expected credit loss by considering factors such as historical experience, market data, issuer-specific factors, and current economic conditions. The aggregate fair value of the marketable securities in an unrealized loss position was $26.6 million and $73.2 million as of December 31, 2024 and 2023, respectively. The unrealized losses were attributable to changes in interest rates that impacted the value of the investments, and not related to increased credit risk. Accordingly, we have not recorded an allowance for credit losses associated with these investments.
The contractual maturities of the investments classified as marketable securities are as follows:
As of December 31, 2024 | |||||||||||||||||||||||
| (in thousands) | Mature within one year | Mature after one year through two years | Mature over two years | Fair Value | |||||||||||||||||||
| Corporate bonds | $ | — | $ | 2,869 | $ | 902 | $ | 3,771 | |||||||||||||||
| Asset-backed securities | — | — | 34,999 | 34,999 | |||||||||||||||||||
| U.S. government and agency securities | 5,984 | — | 1,859 | 7,843 | |||||||||||||||||||
| Total marketable securities | $ | 5,984 | $ | 2,869 | $ | 37,760 | $ | 46,613 | |||||||||||||||
As of December 31, 2023 | |||||||||||||||||||||||
| (in thousands) | Mature within one year | Mature after one year through two years | Mature over two years | Fair Value | |||||||||||||||||||
| Corporate bonds | $ | 20,756 | $ | 292 | $ | — | $ | 21,048 | |||||||||||||||
| Asset-backed securities | 238 | 1,806 | 47,892 | 49,936 | |||||||||||||||||||
| U.S. government and agency securities | 8,929 | — | 2,507 | 11,436 | |||||||||||||||||||
| Foreign government and agency securities | 341 | — | — | 341 | |||||||||||||||||||
| Total marketable securities | $ | 30,264 | $ | 2,098 | $ | 50,399 | $ | 82,761 | |||||||||||||||
Derivative Asset and Liabilities
The Company entered into foreign currency derivative contracts with financial institutions to reduce foreign exchange risk related to certain marketable securities denominated in foreign currency. Foreign currency derivative contracts are marked-to-market at the end of each reporting period with gains and losses recognized as other income (expenses). For the years ended December 31, 2024 and 2023, the Company recognized a net gain of $0.3 million and $0.1 million, respectively, on the fair value adjustment of the foreign currency derivative contracts. The notional amount of foreign currency derivative contracts as of December 31, 2024 and 2023 was $1.2 million and $14.7 million, respectively.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2024 | Mar 13, 2025 | Showing above |
| 2023 | Mar 5, 2024 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.