Executives of Origin Materials Inc. disclosed that they received nearly 6 million stock options, potentially worth $50 million, as part of the transaction that made Origin a publicly traded company last month.
West Sacramento-based Origin Materials (Nasdaq: ORGN) became a publicly traded company in a merger with a special purpose acquisition company. The deal raised more than $900 million to help Origin commercialize its zero-carbon plastic technology.
The company’s top six executives were granted a total of 5.98 million options to buy shares of Origin stock, mostly at prices ranging from 14 to 37 cents, according to disclosures filed with the Securities and Exchange Commission.
Co-CEO Richard Riley has options to buy 2.5 million shares from 14 cents each.
The company's other co-CEO and co-founder John Bissell has 2.4 million options, with the vast majority able to be exercised at 14 cents, though he has more than 500,000 options he could exercise at prices ranging from 28 to 37 cents each.
Origin Materials stock closed Friday at $8.38, which means Riley and Bissell both have options currently worth around $20 million if they were exercised.
The options have a variety of lock-up dates, and some of them require the company to achieve milestones before the options can be exercised. Some of the milestones include company shares trading at more than $15 for 10 consecutive trading days in 2024; shares trading over $20 for 10 consecutive trading days in 2025; and shares trading at more than $25 for 10 days in 2026. Those longer-term increases are meant to keep management focused.
When asked for comment by the Business Journal, a public relations consultant to Origin Materials said the filings were routine and required and declined to comment further.
Four other executives have a total of $1.18 million in options, most of them exercisable at 14 cents, though one tranche of just under 17,000 options has exercise prices as high as $1.21.
Origin's merger with Artius Acquisition Inc. was announced in February and closed last month. As a special purpose acquisition company, or SPAC, Artius had no business operations of its own and was formed for the sole purpose of acquiring an operating business to bring it public.
Origin plans to use the proceeds of the merger to build its first two manufacturing plants. Executives have said they have nearly sold out the capacity of those two plants in advance. Some of Origin's original investors include future customers. Among them are international food companies Nestle SA, Danone SA and PepsiCo Inc. (Nasdaq: PEP).
After the merger was announced, Origin announced a string of partnerships, including with carmaker Ford Motor Co. (NYSE: F), fiber companies and packaging companies that are poised to be future users of Origin’s plastic, which is made from wood rather than petroleum.
