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CoverageForm 410-K10-Q8-K13D13G13F

Fast Radius, Inc.

FSRDCIK 0001832351 · Every Form 4 filed by insiders at this issuer. See financials →

Annual report (10-K)

Latest 10-K filed Apr 15, 2022. Sentiment + YoY language diff vs prior year. Read sections →

Signal:No prior 10-K

Risk Factors:tone -0.0263

MD&A:tone -0.0061

Sentiment via Loughran-McDonald lexicon · YoY diff via Jaccard similarity + paragraph set difference.

YoY shift: Unscored

Year-over-year tone shift - average net-tone change across Risk Factors and MD&A vs the prior 10-K.

Why YoY instead of absolute: the LM lexicon has ~6.6× more negative words than positive (legal/risk-disclosure language is heavy on hedging), so every 10-K reads bearish on raw tone. Year-over-year change strips that bias and surfaces the actual shift in management's framing.

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Top insiders

Most active reporters at Fast Radius, Inc.

Name	Roles	Filings
McCusker Patrick	Officer	3
Rassey Louis	OfficerDirector10% Owner	3
Ecp Controlco, LLC	Director10% Owner	2
Ennv Holdings, LLC	Director10% Owner	2
Koch Steven	Director	2

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14 Form 4 / 4-A filings, newest first

Filed	Insider	Top transaction	Shares	Price	Value
Jun 3, 2022	Rassey Louis Chief Executive Officer · Director · 10% Owner	MExercise	2,522	-	-
Jun 3, 2022	McCusker Patrick Chief Operating Officer	MExercise	2,223	-	-
Apr 19, 2022	Rassey Louis Chief Executive Officer · Director · 10% Owner	Holdings only	-	-	-
Apr 19, 2022	Ziegler Elizabeth Director	Holdings only	-	-	-
Apr 19, 2022	Gandhi Prithvi Chief Financial Officer	Holdings only	-	-	-

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Real-time Form 4 intelligence. Smarter insider tracking.

Filed		Top transaction	Shares	Price	Value

MD&A (Item 7)

4,232 words

Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and related notes included in Part II, Item 8 of this Annual Report.

Unless otherwise indicated, references in this section to the terms “ENNV,” the “Company,” “we,” “our” and “us” refer to ECP Environmental Growth Corp. prior to the Business Combination. The term “Legacy Fast Radius” refers to privately-held Fast Radius Operations, Inc. prior to its merger with ENNV Merger Sub, Inc., a wholly owned subsidiary of ECP Environmental Growth Corp.

The financial information included in this Management’s Discussion and Analysis of Financial Condition and Results of Operations is that of ENNV prior to the Business Combination because the Business Combination was consummated after the period covered by the consolidated financial statements included in this Annual Report on Form

Accordingly, the historical financial information included in this Annual Report on Form

unless otherwise indicated or as the context otherwise requires, is that of the Company prior to the Business Combination.

Overview

Until February 4, 2022, we were a blank check company, originally incorporated in Delaware on October 29, 2020, and formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.

Recent Developments

On February 4, 2022 (the “Closing Date”), we consummated the previously announced merger pursuant to that certain Agreement and Plan of Merger, dated as of July 18, 2021, by and among the Company, ENNV Merger Sub, Inc., a Delaware corporation and a direct, wholly owned subsidiary of the Company (“Merger Sub”) and Fast Radius Operations, Inc., a Delaware corporation (formerly known as Fast Radius, Inc.) (“Legacy Fast Radius”), as amended by the Amendment to the Agreement and Plan of Merger (“Amendment No. 1”), dated as

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of December 26, 2021, by and among the Company, Merger Sub and Legacy Fast Radius and as further amended by Amendment No. 2 to the Agreement and Plan of Merger, dated as of January 31, 2022, by and among the Company, Merger Sub and Legacy Fast Radius (“Amendment No. 2” and as amended by Amendment No. 1 and Amendment No. 2, the “Merger Agreement”).

Pursuant to the terms of the Merger Agreement, a business combination of Legacy Fast Radius and the Company was effected by the merger of Merger Sub with and into Legacy Fast Radius, with Legacy Fast Radius surviving the Merger as a wholly owned subsidiary of the Company (the “Merger”). At the effective time of the Merger (the “Effective Time”), all of the issued and outstanding securities of Legacy Fast Radius were converted into an aggregate of (i) 65,000,000 shares of the Company’s common stock (including 11,196,271 shares of the Company’s common stock underlying exchanged options, vested RSUs and exchanged RSUs) and (ii) the contingent right to receive during the earnout period certain additional shares of the Company’s common stock as specified in the Merger Agreement (the “Merger Earnout Shares”), in two equal tranches of 5,000,000 shares of the Company’s common stock, upon the satisfaction of certain price targets set forth in the Merger Agreement, which price targets will be based upon the volume-weighted average closing sale price of one share of the Company’s common stock quoted on NASDAQ, for any twenty (20) trading days within any thirty (30) consecutive trading day period within the earnout period.

In connection with the Closing, the Company changed its name from ECP Environmental Growth Corp. to Fast Radius, Inc. The audited consolidated financial statements included herein are those of the Company prior to the Merger. Prior to the Merger, the Company neither engaged in any operations nor generated any revenue. Until the Merger, based on the Company’s business activities, it was a “shell company” as defined under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

Results of Operations

We neither engaged in any operations (other than searching for a Business Combination after the Company’s initial public offering (the “ENNV IPO” or the “Initial Public Offering”)) nor generated any revenues prior to the Merger. Our only activities from October 29, 2020 (inception) through December 31, 2021 were organizational activities, completion of the ENNV IPO and the evaluation of possible business combinations. We do not expect to generate any operating revenues until after the completion of the Business Combination. We expect to generate

non-operating

income in the form of interest income on the proceeds derived from the ENNV IPO and placed in our Trust Account. We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.

For the year ended December 31, 2021, we had a net income of $5,953,450, which consists of formation and operating costs of ($5,154,531), interest and dividends earned on marketable securities held in the Trust Account of $33,673, offering costs allocated to derivative warrant liabilities of ($750,743), and change in fair value of derivative warrant liabilities and forward purchase agreement of $13,074,810, and offering costs on Founder Shares issued to related party of ($1,249,759). For the year ended December 31, 2020, we had a net loss of $(20), which consists of formation and operating costs of $(20).

Liquidity and Capital Resources

As of December 31, 2021, we had cash of $82,234 outside of the Trust Account and a working capital deficiency of $3,359,143. Until the consummation of the Initial Public Offering, our only sources of liquidity were an initial purchase of common stock by the Sponsor and a loan from an affiliate of our Sponsor. Through December 31, 2021, the Company’s liquidity needs were satisfied through receipt of $25,000 from the sale of the Founder Shares, formation and offering costs paid by the Sponsor on the Company’s behalf in an aggregate amount of $188,149, which were repaid from the remaining net proceeds from the Initial Public Offering and Private Placement, and proceeds of $499,702 against the Working Capital Loan.

On February 11, 2021, we consummated the Initial Public Offering of 34,500,000 Units at a price of $10.00 per Unit, including 4,500,000 Units sold pursuant to the full exercise of the underwriters’ option to purchase

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additional Units to cover over-allotments, generating gross proceeds of $345,000,000. Simultaneously with the closing of the Initial Public Offering, we completed two private sales of an aggregate of 6,266,667 Private Placement Warrants at a price of $1.50 per Private Placement Warrant to the Sponsor and GSAM, in its capacity as investment adviser on behalf of the GSAM Client Accounts, generating gross proceeds of $9,400,000.

Following the Initial Public Offering and the sale of the Private Placement Warrants, a total of $345,000,000 was placed in the Trust Account and we had $1,991,625 of cash held outside of the Trust Account, after payment of costs related to the Initial Public Offering, available for working capital purposes. We paid a total of $6,900,000 in underwriting discounts and commissions and $652,069 for other cash offering costs related to the Initial Public Offering. In addition, the underwriters agreed to defer $12,075,000 in underwriting discounts and commissions until the consummation of a Business Combination.

On July 30, 2021, the Company issued an unsecured promissory note in the principal amount of $1,500,000 to an affiliate of the Sponsor, which could be drawn down by the Company from time to time upon written notice to the lender. The Note did not bear interest and was repayable in full upon consummation of a Business Combination. As of December 31, 2021, the Company had borrowed approximately $499,702 under the Note. The Note was repaid upon the consummation of the Business Combination.

Since inception, Legacy Fast Radius has generated recurring losses which have resulted in an accumulated deficit of $123 million as of December 31, 2021. Subsequent to the Merger, the combined company expects to incur additional losses in the future as it expects to continue to make substantial investments in its business, including in the expansion of its product portfolio and in its research and development, sales and marketing teams, in addition to incurring additional costs as a result of being a public company. The Company believes the cash it obtained from the Merger, net of redemptions, and the private placement that occurred substantially concurrently with the consummation of the Merger, are not sufficient to meet its working capital and capital expenditure requirements for a period of at least twelve months from the date of these financial statements.

Going Concern

As a result of Legacy Fast Radius’ history of losses and negative cash flows from operations, and because its plans to obtain additional capital have not been completed at the time of the issuance of these consolidated financial statements, substantial doubt exists about the Company’s ability to continue as a going concern within one year after the date that these consolidated financial statements are issued. The Company expects to generate additional cash to fund its growth through future debt or equity transactions; however, there can be no assurance that the Company will be able to obtain other debt or equity financing on terms acceptable to the Company, if at all. Failure to secure additional funding may require the Company to modify, delay, or abandon some of its planned future expansion or development, or to otherwise enact operating cost reductions available to management, which could have a material adverse effect on the Company’s business, operating results, financial condition, and ability to achieve its intended business objectives.

Off-Balance

Sheet Financing Arrangements

We did not have any

off-balance

sheet arrangements as of December 31, 2021.

Contractual Obligations

We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities.

The underwriters of the ENNV IPO were entitled to a deferred fee of $0.35 per Unit, or $12,075,000 in the aggregate in connection with the Closing, irrespective of the amount of redemptions by the public stockholders. As of February 4, 2022, approximately 91% of outstanding Public Shares were redeemed, as shareholders redeemed 31,512,573 Public Shares in connection with the Business Combination. The funds remaining in the Company’s trust account following such redemptions were approximately $29.9 million. As a result, the underwriters agreed to forfeit $7,046,415 of underwriting fees. We have since paid the underwriters $1,257,146 of the remaining $5,028,585 of fees due upon the consummation of the Business Combination and deferred the remaining $3,771,439 to a later date.

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In connection with the execution of the Merger Agreement, the Company entered into the Subscription Agreements with the PIPE Investors, pursuant to which the PIPE Investors agreed to subscribe for and purchase, and the Company agreed to issue and sell to the PIPE Investors, an aggregate of 7,500,000 shares of Class A common stock (1,000,000 shares of which were issued and sold to the Sponsor in its capacity as a PIPE Investor) for a purchase price of $10.00 per share, or an aggregate of $75,000,000, in the PIPE Investment. The Subscription Agreements provide for purchase of ENNV Class A common stock, however the Class A common stock was originally sold in the ENNV IPO as a component of the ENNV units for $10.00 per unit. The ENNV units consist of one share of Class A common stock and

one-quarter

of one ENNV warrant. As of January 5, 2022, the closing price on NASDAQ of the ENNV units was $10.05 per unit and the closing price of the Class A common stock was $9.89 per share.

In accordance with the terms of the Subscription Agreements, on February 4, 2022, the Company issued and sold 7.5 million unregistered securities to the PIPE Investors. The shares of common stock issued pursuant to the Subscription Agreements were not registered under the Securities Act and were issued in reliance upon the exemption provided in Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder.

On January 24, 2021, we entered into the Forward Purchase Agreement with GSAM, as amended by the First Amendment to Forward Purchase Agreement, dated as of January 31, 2021, pursuant to which GSAM committed to purchase an aggregate of up to 5,000,000 Forward Purchase Units in connection with ENNV’s initial business combination. Concurrently with the execution of the Merger Agreement, ENNV, the Sponsor and GSAM entered into the Side Letter, pursuant to which GSAM irrevocably consented to purchase from ENNV, and ENNV agreed to issue and sell to GSAM, 2,500,000 Forward Purchase Units, each consisting of one Forward Purchase Share and

one-quarter

of one Forward Purchase Warrant, at a price of $10.00 per Forward Purchase Unit, or an aggregate of $25,000,000, in a private placement to be consummated substantially concurrently with the consummation of the Business Combination. Each whole Forward Purchase Warrant is exercisable to purchase one share of common stock at an exercise price of $11.50 per share. The Forward Purchase Agreement included an obligation that GSAM would forfeit certain shares of ENNV Class B common stock it acquired from the Sponsor in connection with the ENNV IPO if, at the time GSAM provided or withheld its consent to ENNV’s initial business combination, it owned a number of shares of ENNV Class A common stock less than the number of Public Shares it purchased at closing of the ENNV IPO. Pursuant to the Side Letter, ENNV and the Sponsor waived GSAM’s potential obligation to forfeit such shares of ENNV Class B common stock in connection with the Business Combination.

On January 20, 2022, ENNV, the Sponsor and GSAM entered into the Side Letter pursuant to which, if GSAM acquired any shares of common stock (i) on or after January 20, 2022 but prior to the Cutoff Time and did not exercise any right to redeem such shares in connection with the Redemption or (ii) on or after the Cutoff Time but prior to February 1, 2022 and delivered evidence reasonably satisfactory to ENNV that (a) the stockholder from whom such shares were acquired had, prior to such acquisition, validly elected to redeem such shares in connection with the Redemption and (b) such stockholder or GSAM, as applicable, had, prior to Closing, validly revoked such election to redeem such shares in connection with the Redemption, and, in each case, did not transfer such Eligible Shares prior to the Closing Date, then such Eligible Shares would be

“Non-Redeemed Shares,”

and the number of Forward Purchase Units GSAM was obligated to purchase under the Forward Purchase Agreement would be reduced by the number

of Non-Redeemed Shares.

Notwithstanding any such reduction in the number of Forward Purchase Units that GSAM was obligated to purchase under the Forward Purchase Agreement, upon the consummation of the sale of such Forward Purchase Units, ENNV issued to GSAM a number of redeemable warrants, each of which is exercisable to purchase one share of ENNV Class A common stock at an exercise price of $11.50 per share, which warrants had the same terms as ENNV’s Warrants, such that GSAM received 625,000 Forward Purchase Warrants and Additional Warrants in the aggregate. On January 27, 2022, GSAM delivered to ENNV a notice that it had acquired 2,375,000

Non-Redeemed

Shares. The Company issued 125,000 Forward Purchase Units concurrently with the Closing of the Business Combination on the Closing Date.

Critical Accounting Policies and Estimates

The preparation of consolidated financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and

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assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and income and expenses during the periods reported. We have identified the following critical accounting policies effecting our consolidated financial statements:

Derivative Warrant Liabilities

We account for the ENNV warrants and the Forward Purchase Agreement as either equity-classified or liability-classified instruments based on an assessment of the specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the ENNV warrants and the Forward Purchase Agreement are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the ENNV warrants and the Forward Purchase Agreement meet all of the requirements for equity classification under ASC 815, including whether the ENNV warrants and the Forward Purchase Agreement are indexed to shares of ENNV common stock and whether the holders of ENNV warrants and the Forward Purchase Agreement could potentially require “net cash settlement” in a circumstance outside of our control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of issuance of the ENNV warrants and the time of entry into the Forward Purchase Agreement and as of each subsequent quarterly period end date while the ENNV warrants are outstanding and the Forward Purchase Agreement is effective. For issued or modified ENNV warrants that meet, and the Forward Purchase Agreement if it meets, all of the criteria for equity classification, such warrants and the Forward Purchase Agreement are required to be recorded as a component of additional

paid-in

capital at the time of issuance. For issued or modified warrants that do not, and the Forward Purchase Agreement if it does not, meet all the criteria for equity classification, such warrants and the Forward Purchase Agreement are required to be recorded as liabilities at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the liability-classified warrants or Forward Purchase Agreement are recognized as a

non-cash

gain or loss on the statements of operations.

We account for the ENNV warrants and the Forward Purchase Agreement in accordance with the guidance contained in ASC

under which the ENNV warrants and the Forward Purchase Agreement do not meet the criteria for equity treatment and must be recorded as liabilities.

Accordingly, we classify the ENNV warrants and the Forward Purchase Agreement as liabilities at their fair value and adjust such warrants and the Forward Purchase Agreement to fair value at each reporting period. This liability is subject to

re-measurement

at each balance sheet date until exercised, and any change in fair value is recognized in our consolidated statement of operations.

ENNV Class A Common Stock Subject to Possible Redemption

The Company accounts for its Class A common stock subject to possible redemption in accordance with the guidance in Accounting Standards Codification (“ASC”) Topic 480 “Distinguishing Liabilities from Equity.” Common stock subject to mandatory redemption is classified as a liability instrument and is measured at fair value. Conditionally redeemable common stock (including common stock that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company’s control) is classified as temporary equity. At all other times, common stock is classified as shareholders’ equity. The Company’s Class A common stock features certain redemption rights that are considered to be outside of the Company’s control and subject to occurrence of uncertain future events. Accordingly, at December 31, 2021, 34,500,000 shares of Class A common stock subject to possible redemption are presented as temporary equity outside of the shareholders’ equity section of the Company’s consolidated balance sheets.

As previously reported in the Current Report on

Form 8-K filed

by the Company with the SEC on February 7, 2022, the Company held a special meeting of the Company’s stockholders on February 2, 2022. At the special meeting, the Company’s stockholders considered and adopted, among other matters, the Merger Agreement. Prior to the special meeting, the holders of 31,512,573 shares of common stock exercised their right to redeem

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their shares for cash at a redemption price of approximately $10.01 per share for an aggregate redemption amount of approximately $315.4 million (the “

Redemptions

”). The Redemptions occurred concurrent with the Closing of the Business Combination.

As of the Closing Date and following the completion of the Business Combination, the Company had the following outstanding securities:

73,041,156 shares of common stock;

9,580,413 shares of common stock issuable upon exercise of Exchanged Options and Exchanged RSUs;

1,615,858 shares of common stock issuable upon settlement of fully vested RSUs;

8,625,000 Public Warrants; and

6,891,667 Private Placement Warrants.

Net Income Per Share

Net income per share is computed by dividing net income applicable to common stockholders by the weighted average number of common stock outstanding during the period, plus, to the extent dilutive, the incremental number of shares of common stock to settle warrants, as calculated using the treasury stock method.

At December 31, 2021, ENNV did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into ENNV common stock and then share in the earnings of ENNV under the treasury stock method. As a result, diluted income per share is the same as basic income per share for the periods presented.

Prior to the Business Combination, the Company had two classes of shares, which are referred to as ENNV Class A common stock and ENNV Class B common stock. Earnings are shared pro rata between the two classes of shares as long as the Business Combination is consummated. Accretion associated with the redeemable shares of ENNV Class A common stock is excluded from earnings per share as the redemption value approximates fair value.

Offering Costs

Offering costs consist of legal, accounting, underwriting and other costs incurred through the consolidated balance sheet date that are directly related to the ENNV IPO. Upon the completion of the ENNV IPO in February 2021, the offering costs are allocated using the relative fair values of the ENNV common stock and the ENNV warrants. The costs allocated to the ENNV warrants were recognized in other expenses and those related to ENNV common stock were recognized as a reduction to the carrying value of Class A common stock subject to possible redemption.

Recent Accounting Standards

In August 2020, the FASB issued Accounting Standards Update (“ASU”)

Debt—Debt with Conversion and Other Options (Subtopic

and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic

(“ASU

to simplify accounting for certain financial instruments. ASU

eliminates the current models that require only separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU

amends the diluted earnings per share guidance, including the requirement to use the

if-converted

method for all convertible instruments. ASU

is effective for fiscal years beginning after December 15, 2023 and should

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be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. ENNV is currently assessing the impact, if any, that ASU

would have on its financial position, results of operations or cash flows.

Management does not believe that any other recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on our consolidated financial statements.

JOBS Act

The Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”) contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We qualify as an “emerging growth company” and under the JOBS Act are allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for

non-emerging

growth companies. As a result, the consolidated financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.

Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an “emerging growth company,” we choose to rely on such exemptions we may not be required to, among other things, (i) provide an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of

non-emerging

growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the consolidated financial statements (auditor discussion and analysis) and (iv) disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO’s compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of our initial public offering or until we are no longer an “emerging growth company,” whichever is earlier.

Fast Radius, Inc.

Annual report (10-K)

Risk Factors (Item 1A)

Top insiders

All filings

Risk Factors (Item 1A)

MD&A (Item 7)

External resources

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