Origin Materials, Inc.

Technology Behind Origin's patented platform for turning the carbon found in sustainable wood residues into useful materials for a wide range of end products, including clothing, textiles, plastics, packaging, car parts, tires, carpeting, toys, and more, while capturing the carbon in the process. The Green Chemistry Challenge Award is a key recognition for any technology at the forefront of environmental sustainability. The award spans multiple industries, from pharmaceuticals to basic commodity chemicals, and is recognized for impressive achievements. Since 1996, EPA and the American Chemical Society, which co-sponsored the awards, have received more than 1,800 nominations and presented awards to a small fraction of those that decreased the use of hazardous chemicals and resources, reduced costs, protect public health, and spur economic growth. The winning technologies have saved more than 20 billion gallons of water per year, almost 8 billion pounds of CO2 per year, and eliminated nearly a billion pounds of toxic and hazardous chemicals per year. For 2022, our fellow award winners include research powerhouses such as Amgen and Merck. Origin's journey as a company began in 2008 when we received a different EPA award called the People, Prosperity, and the Planet Award, which is focused on early stage research. Now, 14 years later, we are honored to receive this meaningful award from the EPA in the category of climate change. Next, starting on slide 12, I'm going to provide an update on Origin 1 and Origin 2. For those interested in the Origin 1 construction story, I would like to point you to a new construction update video that we posted today to the investor relations section of our website. For Origin 1, our first plant located in Sarnia, Ontario, construction is progressing well despite the challenging supply chain environment, and we remain on track for mechanical completion by the end of 2022 with preparations for commissioning and startup underway. We are maintaining our previously disclosed capital budget for Origin 1 of $125 million to $130 million. During the second quarter, we strengthened and added to the OriginOne operations leadership team and support staff. We accomplished a tremendous amount of construction since our last update. This is a large manufacturing plant with a lot of moving parts, and what we've been able to accomplish to date, despite COVID and macro supply chain issues, truly shows the capability, efficiency, and efficacy of our capital projects team. In our slides and in our construction video, you can see the progress we've made since our last update. We received additional major equipment onsite, including piping modules, which we have installed and interconnected alongside the plant's key production modules. The piping modules both interconnect our core chemical process modules and connect the OM1 plant with the utility supplied by the neighboring site. As we have discussed before, the modules were fabricated offsite using a modular construction approach and shipped in, which minimizes the work to be done in the field. Although installation is less complicated than the installation of our key production modules, these are nonetheless sizable racks and pipe modules. You can see that the team has largely interconnected them and connected them with the plant's utility systems and our ENCON evaporator unit. We receive tanks on site that will contain solvent that will be used and recycled as part of our core chemical process. Our site will have lots of integrated storage, which gives us the ability to manage our chemicals and materials. Our CMF storage tanks are in the final stages of fabrication and painting before shipment to the site. We started the construction of our biomass building, which is where we will store our sustainable wood residues entering the plant prior to processing and conveying to the reactor system. We started construction of our HTC building, where we will handle one of our platform products. Both the biomass building and the HTC building feature a significant amount of steel and a number of components and pieces connected together. The most interesting story here is that we received, lifted, and installed our filter press into the HTC building. The filter press utilizes the same HTC separation technique that is currently used at our pilot plant in California, but is much larger. As an additional note on a very important topic, the team has done an incredible job creating a great safety culture while executing this project. We will very much take what we have learned and the culture we've developed to Origin 2 and beyond. It's been a busy 18 months for the company, and the team has done an excellent job. We're not done yet, but from here, we have a clear path forward to mechanical completion, commissioning, and startups. With regard to Origin 2, our previously disclosed capital budget, construction timeline, and financing are unchanged. As discussed on prior calls, we are closely monitoring costs associated with the current high levels of inflation and the challenging supply chain environment. We continue to proactively manage our cost base and note that we have built appropriate contingencies into our initial production. We are not currently placing any equipment or construction orders for Origin 2, and we expect current inflation and supply chain conditions to likely change in our favor in the next 12 to 24 months. I would also note that materials companies generally benefit from higher product prices and margins in an inflationary environment, which can mitigate the impact of inflation on our capital budget. Origin two, our first world-scale manufacturing facility will produce carbon negative materials used to make PET plastic resin and fiber, which is used in packaging, textiles, apparel, and other applications. And HTC, which can be used as fuel, as activated carbon, and as a replacement for carbon black. Front-end design of the plant is underway, with detailed engineering set to begin in 2023. As previously announced, we've selected a site in Geismar, Louisiana, for Origin 2, subject to finalization of economic incentives. We expect the 150-acre facility will convert an estimated 1 million dry metric tons of sustainable wood residues each year into products for a wide range of end markets. Some of the reasons that we believe the Geismar site is the ideal location for Origin 2 include the extremely skilled labor pool in Louisiana, access to relevant infrastructure, and access to sustainable feedstock. Before I conclude, I'd like to give you some additional detail about what we are currently working on for Origin 2. The team is optimizing the scope and layout of the plant. We're evaluating contractors for FDL2 phase engineering and design work. We're also picking off environmental permitting, and we continue to work closely with landowners and fiber suppliers in Louisiana and Mississippi to put in place our feedstock strategy. To summarize, the team has continued to make considerable progress, and our expectation remains that Origin 1 will be completed by the end of 2022. Regarding Origin 2, the previously disclosed capital budget, construction timeline, and financing are unchanged. Origin 1 represents an important milestone for our mission to enable the world's transition to sustainable materials. We are excited by the progress our team has made as we approach commissioning and startup in the second half of the year. And with that, I'll turn it over to Nate to discuss some of the financial details.

Thanks, John. I'll begin with some commentary on our second quarter results, then our financing expectations for origin one and origin two, and finish with an update on our 2022 outlook. Speaking to slide 21, second quarter operating expenses were 8.7 million compared to 6.7 million during the same period in the prior year. Adjusted EBITDA loss was 6.9 million for the second quarter compared to a loss of 3.0 million in the same period in the prior year. And finally, net income was 46.9 million for the second quarter compared to a net income of $62.5 million in the same period in the prior year. Turning to our balance sheet, Origin ended the second quarter with $406.6 million in cash and cash equivalents and marketable securities. We maintain our expectation of fully funding the construction of both Origin 1 and Origin 2 using our existing balance sheet cash and cash equivalents and previously indicated traditional financing sources. With regard to the financing of Origin 2, as previously mentioned, the State of Louisiana, pending finalization, is expected to award a private activity bond. Tax exempt bonds authorized by state and local governments for the financing of qualified projects with private capital, the volume cap allocation to the company in the amount of 400 million. We also expect to receive more than 100 million in pending state and local incentives. We maintain our financing assumptions for Origin 2 remain reasonable and achievable, with Origin 2 fully funded from existing cash on hand and previously indicated traditional project financing sources. The $400 million private activity bond allocation from the state of Louisiana provides a strong foundation for the financing of Origin 2, and in combination with certain 2021 Infrastructure Investment and Jobs Act provisions and other non-volume cap tax-exempt financing could enable the debt financing of Origin 2 using entirely tax-exempt bonds. Origin also continues to work with leading financial institutions on other forms of traditional private financing and federal loan programs, including through the U.S. Department of Agriculture and Department of Energy. As we have highlighted in our previous earnings calls, inflationary pressure remains an area in focus. However, as John discussed, at this point we are not adjusting our overall capital budget for Origin 2. We acknowledge the situation remains fluid and we continue to closely monitor our cost estimates such that we can communicate any changes to the market at appropriate times as we progress through the project. I'll now wrap up with an update on our 2022 outlook. We are maintaining our prior outlook for an adjusted EBITDA loss of up to $36 million and capital expenditures of up to $175 million.

With that, I'll turn it back to Rich for closing remarks. Thank you, Nate.