8-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K/A

(Amendment No. 1)

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 4, 2022

Fast Radius, Inc.

(Exact name of registrant as specified in its charter)

Delaware	001-40032	85-3692788
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

113 N. May Street Chicago, Illinois	60607
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (888) 787-1629

N/A

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.0001 per share	FSRD	The Nasdaq Stock Market LLC
Warrants, each whole warrant exercisable for one share of common stock at an exercise price of $11.50 per share	FSRDW	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Introductory Note

Overview

This Amendment No. 1 on Form 8-K/A (“Amendment No. 1”) amends the Current Report on Form 8-K of Fast Radius Inc., a Delaware corporation (formerly named ECP Environmental Growth Opportunities Corp. (“ENNV”)) (the “Company”), filed on February 10, 2022 (the “Original Report”), in which the Company reported, among other events, the completion of the Business Combination (as defined in the Original Report) between the Company and Fast Radius Operations, Inc., a Delaware corporation (formerly named Fast Radius, Inc.) (“Legacy Fast Radius”), on February 4, 2022 (the “Closing Date”).

This Amendment No. 1 is being filed in order to (i) update and supplement certain risk factors under the header “Risk Factors” in Item 2.01 of the Original Report and (ii) include (a) the Management’s Discussion and Analysis of Financial Condition and Results of Operations of Legacy Fast Radius for the years ended December 31, 2020 and 2021 and (b) the audited financial statements of Legacy Fast Radius as of and for the years ended December 31, 2020 and 2021.

Except as set forth herein, this Amendment No. 1 does not amend any other item of the Original Report or purport to provide an update or a discussion of any developments at the Company or its subsidiaries subsequent to the filing date of the Original Report. The information previously reported in or filed with the Original Report is hereby incorporated by reference to this Amendment No. 1.

Immediately following the filing of the Form 10-K (as defined below), the Company will amend the pro forma financial statements provided under Item 9.01(b) in the Original Report to include the unaudited pro forma condensed combined statement of operations of the Company and Legacy Fast Radius for the year ended December 31, 2021 and the unaudited pro forma condensed combined balance sheet of the Company and Legacy Fast Radius as of December 31, 2021 (the “Pro Formas”) and expects to file the Pro Formas on a further amendment to this Form 8-K as soon as practicable. The Company has filed a notification of late filing on Form 12b-25 with the Securities and Exchange Commission (the “SEC”) with respect to its Annual Report on Form 10-K for the fiscal year ended December 31, 2021 (the “Form 10-K”) because the Company has experienced unexpected delays in its completion of the audit of ENNV’s financial statements and related disclosures for the year ended December 31, 2021 due to the timing of the Business Combination and the substantial amount of internal resources required in connection therewith. The Company expects to file the Form 10-K as soon as practicable within the extension period provided by Rule 12b-25. As a result, the Company requires additional time to finalize ENNV’s financial statements and related disclosures to be filed as part of the Form 10-K, which is necessary for completion of the Pro Formas.

Restatement

In the process of preparing Legacy Fast Radius’ fourth quarter 2021 financial statements, the Company’s management discovered misstatements related to Legacy Fast Radius’ overstatement of revenue and overstatement and understatement of certain expenses related to the nine month period ended September 30, 2021. On March 28, 2022, the Audit Committee of the Company’s board of directors concluded that Legacy Fast Radius would restate its previously issued financial statements for the nine months ended September 30, 2021. The Company concluded that material weaknesses over financial reporting contributed to the following accounting errors at Legacy Fast Radius:

• Revenue was recorded incorrectly for transactions which Legacy Fast Radius could not assert that collection from the customer was probable under the requirements of Accounting Standard Codification (“ASC”) 606.

• Software capitalization costs and the associated amortization were incorrectly calculated and recorded due to errors in tracking the time period when the design, development and testing of the software occurs and is therefore capitalizable under ASC 350-40.

• Legacy Fast Radius incorrectly accrued certain transaction costs twice.

• Certain transaction-related fees that were paid were incorrectly classified as operating cash flows on the condensed consolidated statement of cash flows.

Please refer to Note 16 of the audited financial statements of Legacy Fast Radius included in Exhibit 99.1 to this Amendment No. 1 for additional information.

Item 2.01 Completion of Acquisition or Disposition of Assets.

Special Note Regarding Forward-Looking Statements

The Company makes forward-looking statements in this Amendment No. 1 and in documents incorporated herein by reference. All statements, other than statements of present or historical fact included in or incorporated by reference in this Amendment No. 1, regarding the Company’s future financial performance, as well as the Company’s strategy, future operations, financial position, estimated revenues, and losses, projected costs, prospects, plans and objectives of management are forward-looking statements. When used in this Amendment No. 1, the words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would” the negative of such terms and other similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on management’s current expectations, assumptions, hopes, beliefs, intentions and strategies regarding future events and are based on currently available information as to the outcome and timing of future events. The Company cautions you that these forward-looking statements are subject to all of the risks and uncertainties, most of which are difficult to predict and many of which are beyond the control of the Company, incident to its business.

These forward-looking statements are based on information available as of the date of this Amendment No. 1, and current expectations, forecasts and assumptions, and involve a number of risks and uncertainties. Accordingly, forward-looking statements in this Amendment No. 1 and in any document incorporated herein by reference should not be relied upon as representing the Company’s views as of any subsequent date, and the Company does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

As a result of a number of known and unknown risks and uncertainties, the Company’s actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause the Company’s actual results to differ include:

• the Company’s ability to execute its business strategy, including monetization of solutions and services provided;

• the Company’s ability to scale and adapt existing technology, processes, and infrastructure to meet the needs of its business;

• the Company’s ability to realize the benefits expected from the business combination with Legacy Fast Radius (the “Business Combination”);

• the Company’s ability to continue to develop new solutions and innovations to meet constantly evolving customer demands;

• the Company’s ability to acquire or make investments in other businesses, patents, technologies, solutions, or services to grow the business;

• the Company’s ability to compete in the markets it serves;

• the Company’s ability to increase brand awareness;

• the Company’s ability to develop, design, and sell solutions that are differentiated from those of competitors;

• the Company’s ability to anticipate the impact of the COVID-19 pandemic and its effect on business and financial conditions;

• the Company’s ability to manage risks associated with operational changes in response to the COVID-19 pandemic;

• the Company’s ability to retain and hire necessary employees;

• the Company’s ability to attract, train, and retain effective officers, key employees or directors;

• the Company’s ability to enhance future operating and financial results;

• the Company’s ability to comply with laws and regulations applicable to its business;

• the Company’s ability to stay abreast of modified or new laws and regulations applying to its business, including trade export and privacy regulations;

• the Company’s ability to anticipate the impact of, and response to, new accounting standards;

• the Company’s ability to respond to fluctuations in foreign currency exchange rates and political unrest and regulatory changes in international markets from various events;

• the Company’s ability to anticipate the significance and timing of contractual obligations;

• the Company’s ability to maintain key strategic relationships with customers and suppliers;

• the Company’s ability to respond to uncertainties associated with solution development and market acceptance;

• the Company’s ability to successfully defend litigation;

• the Company’s ability to upgrade and maintain information technology systems;

• the Company’s ability to acquire and protect intellectual property;

• the Company’s ability to anticipate rapid technological changes;

• the Company’s ability to meet future liquidity requirements and comply with restrictive covenants related to long-term indebtedness;

• the Company’s ability to maintain the listing of its securities on NASDAQ or another national securities exchange;

• the Company’s ability to effectively respond to general economic and business conditions;

• the Company’s ability to implement and maintain effective internal controls over financial reporting;

• the Company’s ability to obtain additional capital, including debt or equity financing;

• the Company’s ability to successfully deploy the proceeds from the Business Combination and the private placement that occurred substantially concurrently with the consummation of the Business Combination;

• the Company’s ability to continue as a going concern;

• the fluctuation of operating results from period to period due to a number of factors, including the pace of customer adoption of our solutions;

• increasing competition in the advanced manufacturing industry;

• the impact of changes in consumer spending patterns, consumer preferences, local, regional and national economic conditions, crime, weather, and demographic trends; and

• any defects in new solutions or enhancements to existing solutions.

In addition, statements that “the Company believes” and similar statements reflect the Company’s beliefs and opinions on the relevant subject. These statements are based upon information available to the Company as of the date of this Amendment No. 1, and while the Company believes such information forms a reasonable basis for such statements, such information may be limited or incomplete, and such statements should not be read to indicate that such party has conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements.

Although the Company believes the expectations reflected in the forward-looking statements were reasonable at the time made, it cannot guarantee future results, level of activity, performance or achievements. You should carefully consider the cautionary statements contained or referred to in this section in connection with the forward-looking statements contained in this Amendment No. 1 and any subsequent written or oral forward-looking statements that may be issued by the Company or persons acting on the Company’s behalf.

Risk Factors

Unless the context otherwise requires, all references in this subsection to “we”, “us” or “our” refer to the business of Legacy Fast Radius prior to the Closing and to the Company following the Closing.

The following risk factors supplement the risk factors previously provided under the heading “Risk Factors” in the Original Report:

We may face litigation and other risks as a result of the material weaknesses in our internal control over financial reporting.

We have restated our financial statements for the nine months ended September 30, 2021, in the accompanying financial statements included in this Amendment No. 1. As a result of the material weaknesses we have identified in our internal control over financial reporting, the restatement, the adjustments relating to the overstatement of revenue and overstatement and understatement of certain expenses, and other matters raised or that may in the future be raised by the SEC or others, we may be subject to potential litigation or other disputes which may include, among others, claims invoking the federal and state securities laws, contractual claims or other claims arising from the restatement and material weaknesses in our internal control over financial reporting and the preparation of our financial statements. We can provide no assurance that such litigation or dispute will not arise in the future. Any such litigation or dispute, whether successful or not, could have a material adverse effect on our business, results of operations and financial condition.

We have identified material weaknesses in our internal control over financial reporting. If we fail to remediate the material weaknesses, or if we experience additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls in the future, we may not be able to accurately or timely report our financial condition or results of operations, which may result in material misstatements of our consolidated financial statements or cause us to fail to meet our periodic reporting obligations.

In connection with the audits of our consolidated financial statements for the years ended December 31, 2021 and 2020, our management identified material weaknesses in our internal control over financial reporting. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis. The material weaknesses identified relate to the fact that we did not design or maintain an effective control environment commensurate with our financial reporting requirements, including (a) lack of a sufficient number of trained professionals with an appropriate level of accounting knowledge, training and experience to appropriately analyze, record and disclose accounting matters timely and accurately, and (b) lack of accounting processes, structures, reporting lines and appropriate authorities and responsibilities to achieve financial reporting objectives. This deficiency in our control environment contributed to the following additional deficiencies (each of which individually represents a material weakness) in our internal control over financial reporting:

• We did not design and maintain formal accounting policies, procedures, and controls to achieve complete, accurate and timely financial accounting, reporting and disclosures, including controls over the preparation and review of account reconciliations, journal entries, and complex transactions; and

• We did not design and maintain effective controls over segregation of duties for key financial processes and access within IT systems, which includes certain personnel having the ability to both prepare and post manual journal entries without an independent review by someone without the ability to prepare and post manual journal entries.

In addition, in the process of preparing our fourth quarter 2021 financial statements, management discovered misstatements related to the overstatement of revenue and overstatement and understatement of certain expenses related to the nine month period ended September 30, 2021. On March 28, 2022, the Audit Committee of our board of directors concluded that we would restate our previously issued financial statements for the nine months ended September 30, 2021. We concluded that material weaknesses over financial reporting contributed to the following accounting errors:

• Revenue was recorded incorrectly for transactions which we could not assert that collection from the customer was probable under the requirements of Accounting Standard Codification (“ASC”) 606.

• Software capitalization costs and the associated amortization were incorrectly calculated and recorded due to errors in tracking the time period when the design, development and testing of the software occurs and is therefore capitalizable under ASC 350-40.

• We incorrectly accrued certain transaction costs twice.

• Certain transaction-related fees that were paid were incorrectly classified as operating cash flows on the condensed consolidated statement of cash flows.

Please refer to Note 16 of the audited financial statements of Legacy Fast Radius included in Exhibit 99.1 to this Amendment No. 1 for additional information.

We have begun remediation and will continue to implement several measures, including, among others:

• engaging a third party to assist with the development of a Sarbanes-Oxley program;

• hiring additional competent and qualified accounting and reporting personnel with appropriate knowledge and experience of GAAP and SEC financial reporting requirements;

• establishing and designing internal financial reporting structures and authorizing certain departments or capable and responsible persons to be in charge of the overall financial management and financial objectives of the Company;

• establishing an ongoing program to provide sufficient additional training to our accounting staff, especially training related to GAAP and SEC financial reporting requirements;

• designing and preparing accounting policies in accordance with relevant rules, especially in relation to complex and major transactions; and

• updating our policies and procedures to address segregation of duties for key financial processes.

Although we have begun to implement measures to address the material weaknesses above, including hiring a new Chief Financial Officer and Chief Accounting Officer, the implementation of these measures may not fully address the material weaknesses and deficiencies in our internal controls over financial reporting and there can be no assurance that the measures we have taken to date and actions we may take in the future will be sufficient to remediate these matters. Further, in the future we may determine that we have additional material weaknesses. Our failure to remediate the material weaknesses or failure to identify and address any other material weaknesses or control deficiencies could result in inaccuracies in our consolidated financial statements and could also impair our ability to comply with applicable financial reporting requirements and related regulatory filings on a timely basis, which could cause investors to lose confidence in our reported financial information. At this time, we cannot provide an estimate of costs expected to be incurred in connection with implementing its remediation plan; however, these remediation measures will be time consuming, will result in the incurrence of significant costs, and will place significant demands on our financial and operational resources.

Without obtaining adequate capital funding or improving our financial performance, we may not be able to continue as a going concern.

Our recurring losses from operations and negative cash flows raise substantial doubt about our ability to continue as a going concern without additional capital raising activities. As a result, we have concluded that there is substantial doubt about our ability to continue as a going concern. Similarly, our independent registered public accounting firm included an explanatory paragraph in its report on our consolidated financial statements as of, and for the year ended, December 31, 2021, describing the existence of substantial doubt about our ability to continue as a going concern. We do not believe that the funds raised through the Business Combination will enable us to fund our expansion plans, realize our business objectives and to continue as a going concern for the next twelve months. Failure to secure additional funding may require us to modify, delay, or abandon some of our planned future expansion or development, or to otherwise enact operating cost reductions available to management, which could have a material adverse effect on our business, operating results, financial condition, and ability to achieve our intended business objectives.

Our bookings might not accurately predict our future revenue, and we might not realize all or any part of the anticipated revenues reflected in our bookings.

Our bookings represent the anticipated contract value of goods and services to be delivered in the future under contracts (or purchase orders) which have been executed as well as contracts under negotiation that are priced, fully scoped, verbally awarded, and expected to be executed shortly. Bookings vary from period to period depending on numerous factors, including the overall health of the manufacturing industry, industry consolidation, and sales performance. We expect that the majority of purchase orders included in bookings for a given fiscal quarter will be earned as revenues within the quarter or subsequent four fiscal quarters, with the specific timing determined by the nature and scope of each purchase order, but generally not to exceed one fiscal year. However, in some cases, larger than average, long-term purchase orders may have a delivery schedule that spans beyond four quarters. Executed purchase orders also may be terminated or delayed at any time by our customers for reasons beyond our control. To the extent projects are delayed, the anticipated timing of our revenues could be materially adversely affected.

In the event a customer terminates a contract or purchase order, we are generally entitled to be paid for performance rendered through the termination date and for performance provided in winding down the project. However, we are generally not entitled to receive the full amount of revenues reflected in our bookings in the event of a contract or purchase order termination. A number of factors may affect bookings and the revenues generated from our bookings, including:

• the size, complexity and duration of the products being manufactured;

• changes in delivery schedules; and

• the cancellation or delay of a contract or purchase order.

Although we expect an increase in bookings will generally result in an increase in future revenues to be recognized over time (depending on future contract modifications, contract cancellations and other adjustments), an increase in bookings over a particular period in time does not necessarily correspond to an increase in revenues during a particular period. The timing and extent to which bookings will result in revenues depends on many factors, including the timing of commencement of work, the rate at which we perform services, schedule changes, cancellations and delays, and the nature, duration, size and complexity of the products being manufactured. As a result of these factors, bookings are not necessarily a reliable indicator of future revenues and we might not realize all or any part of the revenues from the authorizations in bookings as of any point in time.

The manufacture and distribution of our products is subject to the risks of doing business in China, which could affect our ability to obtain products from suppliers or control the costs of our products.

The possibility of adverse changes in trade or political relations with China, political instability, increases in labor costs, or the continuation of the COVID-19 pandemic or the outbreak of another pandemic disease in China could severely interfere with the manufacturing and/or shipment of our products and would have a material adverse effect on our operations. Our business operations may be adversely affected by the current and future political environment in China. Our ability to source supplies and products from China may be adversely affected by changes in Chinese laws and regulations (or the interpretation thereof), including those relating to taxation, import and export tariffs, raw materials, environmental regulations, land use rights, property and other matters. Under its current leadership, China’s Communist Party has been pursuing economic reform policies; however, there is no assurance that China’s government will continue to pursue these policies, or that it will not significantly alter these policies without notice. Policy changes could adversely affect our interests through, among other factors: changes in laws and regulations, confiscatory taxation, restrictions on currency conversion, imports or sources of supplies, or the expropriation or nationalization of private enterprises. In addition, electrical shortages, labor shortages or work stoppages may extend the production time necessary to produce our orders. There may be circumstances in the future where we may have to incur higher freight charges to expedite the delivery of product to our customers which could negatively affect our gross profit if we are unable to pass on those charges to our customers.

Our existing and planned global operations subject us to a variety of risks and uncertainties that could adversely affect our business and operating results. Our business is subject to risks associated with selling custom parts and other products in non-United States locations.

For the year ended December 31, 2021, our products and services were distributed in over 25 countries around the world, and we derived approximately 5% of our revenue from these international markets. Accordingly, we face operational risks from doing business internationally.

Our operating results may be affected by volatility in currency exchange rates and our ability to effectively manage our currency transaction risks. Although we currently invoice customers in United States dollars, increases in the value of the dollar relative to foreign currencies may make our products less attractive to foreign customers. We may also incur currency transaction risks when we enter into either a purchase or a sale transaction using a different currency than United States dollars. In such cases, we may suffer an exchange loss because we do not currently engage in currency swaps or other currency hedging strategies to address this risk. As we realize our strategy to expand internationally, our exposure to currency risks may increase. Given the volatility of exchange rates, we can give no assurance that we will be able to effectively manage our currency transaction risks or that any volatility in currency exchange rates will not have an adverse effect on our results of operations.

The shipments of our products to foreign customers and/or end-users may be subject to tariffs and other restrictions imposed by the destination countries. As we procure equipment and materials from foreign suppliers, we may be required to pay import duties and comply with regulations imposed by the United States Customs and Border Protection (“CBP”). Both the U.S. and foreign tariff rates and import restrictions may change from time to time, which could adversely impact our global operations, for example, by decreasing the price competitiveness of our products in foreign markets and/or by increasing our manufacturing costs.

Other risks and uncertainties we face from our global operations include:

• difficulties in staffing and managing foreign operations;

• limited protection for the enforcement of contract and intellectual property rights in certain countries where we may sell our products or work with suppliers or other third parties;

• potentially longer sales and payment cycles and potentially greater difficulties in collecting accounts receivable;

• costs and difficulties of customizing products for foreign countries;

• challenges in providing solutions across a significant distance, in different languages and among different cultures;

• laws and business practices favoring local competition;

• being subject to a wide variety of complex foreign laws, treaties and regulations and adjusting to any unexpected changes in such laws, treaties, and regulations, including local labor laws;

• strict laws and regulations governing privacy and data security, including the European Union’s General Data Protection Regulation;

• uncertainty and resultant political, financial and market instability arising from the United Kingdom’s exit from the European Union;

• compliance with U.S. laws affecting activities of U.S. companies abroad, including the U.S. Foreign Corrupt Practices Act;

• tariffs, trade barriers and other regulatory or contractual limitations on our ability to sell or develop our products in certain foreign markets;

• operating in countries with a higher incidence of corruption and fraudulent business practices;

• changes in regulatory requirements, including export controls, tariffs and embargoes, other trade restrictions, competition, corporate practices, and data privacy concerns;

• failure by our distribution partners to comply with local laws or regulations, export controls, tariffs and embargoes or other trade restrictions;

• potential adverse tax consequences arising from global operations;

• seasonal reductions in business activity in certain parts of the world, particularly during the summer months in Europe and at year end globally;

• rapid changes in government, economic and political policies, and conditions; and

• political or civil unrest or instability, terrorism, war or epidemics and other similar outbreaks or events.

In October 2021, based on an internal review, we became aware of certain additional customs duties likely owed to CBP. We initiated a voluntary prior disclosure to CBP in late 2021 of certain possible errors in the declaration of imported products relating to value, classification, and other matters. As part of our disclosure, we conducted a comprehensive review of our import practices and in March 2022 made a further submission to CBP providing details regarding the possible errors. Based on currently known information, we recognized a $1.0 million charge within “Cost of revenues” in our Consolidated Statement of Operations for the year ended December 31, 2021. The information we submitted will be reviewed by CBP and we may be liable to CBP for additional unpaid duties and interest. The resolution of this prior disclosure could be material to our cash flows in a future period and to our results of operations for any period.

In addition, additive manufacturing has been identified by the U.S. government as an emerging technology and is currently being further evaluated for national security impacts. We expect additional regulatory changes to be implemented that will result in increased and/or new export controls related to additive manufacturing technologies, components and related materials and software. These changes, if implemented, may result in our being required to obtain additional approvals and/or licenses to sell products in the global market.

Our failure to effectively manage the risks and uncertainties associated with our global operations could limit the future growth of our business and adversely affect our business and operating results.

Uncertainty and instability resulting from the conflict between Russia and Ukraine could negatively impact our business, financial condition and operations.

Russia’s recent invasion of Ukraine and the uncertainty surrounding the escalating conflict could negatively impact global and regional financial markets which could result in businesses postponing spending in response to tighter credit, higher unemployment, financial market volatility, negative financial news, and other factors. In addition, our suppliers and contractors may have staff, operations, materials or equipment located in the Ukraine or Russia which could impact our supply chain or services being provided to us. Poor relations between the United States and Russia, sanctions by the United States and the European Union against Russia, and any escalation of political tensions or economic instability in the area could have an adverse impact on our suppliers and contractors. In particular, Russia’s invasion of Ukraine and the increased tensions among the United States, the North Atlantic Treaty Organization and Russia could increase the threat of armed conflict, cyberwarfare and economic instability that could disrupt or delay the operations of these resources in Russia and/or Ukraine, disrupt or delay communication with such resources or the flow of funds to support their operations, or otherwise render our resources unavailable.

We intend to use non-GAAP financial measures in reporting our annual and quarterly results of operations.

As part of our reporting of our annual and quarterly results of operations, we intend to publish measures compiled in accordance with GAAP as well as non-GAAP financial measures, along with a reconciliation between the GAAP and non-GAAP financial measures. The reconciling items adjust amounts reported in accordance with GAAP for certain items which are described in detail in our published results of operations. Our consolidated financial statements themselves do not and will not contain any non-GAAP financial measures.

We believe that our non-GAAP financial measures are meaningful to investors when analyzing our results of operations as this is how our business is managed. The market price of our stock may fluctuate based on future non-GAAP results if investors base their investment decisions on such non-GAAP financial measures. If we decide to alter or curtail the use of non-GAAP financial measures in our quarterly earnings press releases, the market price of our stock could be adversely affected if investors analyze our performance in a different manner.

Further, any failure to accurately report and present our non-GAAP financial measures could cause investors to lose confidence in our reported financial and other information, which would likely have a negative effect on the trading price of our common stock.

Financial Information

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

The information set forth in Exhibit 99.2 to this Amendment No. 1 is incorporated herein by reference.

Financial Statements and Supplementary Data

Reference is made to the disclosure set forth under Item 9.01 of this Amendment No. 1 concerning the Company’s consolidated financial statements and supplementary data.

Financial Statements and Exhibits

The information set forth in Item 9.01 of this Amendment No. 1 is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(a) Financial Statements of Business Acquired.

The audited financial statements of Legacy Fast Radius as of and for the years ended December 31, 2020 and 2021 and the related notes are attached as Exhibit 99.1 and are incorporated herein by reference. Also included as Exhibit 99.2 and incorporated herein by reference is the Management’s Discussion and Analysis of Financial Condition and Results of Operations of Legacy Fast Radius for the years ended December 31, 2020 and 2021.

(c) Exhibits.

Exhibit Number	Description
99.1*	Audited financial statements of Legacy Fast Radius as of and for the years ended December 31, 2020 and 2021.
99.2*	Management’s Discussion and Analysis of Financial Condition and Results of Operations of Legacy Fast Radius for the years ended December 31, 2020 and 2021.

* Filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	FAST RADIUS, INC.
Dated: March 30, 2022
	By:	/s/ Lou Rassey
		Lou Rassey
		Chief Executive Officer

EX-99.1

Exhibit 99.1

Consolidated Financial Statements
CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2021 AND DECEMBER 31, 2020	3
CONSOLIDATED STATEMENTS OF NET LOSS AND COMPREHENSIVE LOSS FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020	4
CONSOLIDATED STATEMENTS OF TEMPORARY EQUITY AND STOCKHOLDERS’ DEFICIT FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020	5
CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020	6
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS	7

1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the stockholders and the Board of Directors of Fast Radius Operations, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Fast Radius Operations, Inc. and subsidiary (the “Company”) as of December 31, 2021 and 2020, the related consolidated statements of net loss and comprehensive loss, temporary equity and stockholders’ deficit, and cash flows, for each of the two years in the period ended December 31, 2021, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2021, in conformity with accounting principles generally accepted in the United States of America.

Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, since inception, the Company has experienced recurring losses from operations and generated negative cash flows from operations that raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB and in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ Deloitte & Touche LLP

Chicago, Illinois

March 30, 2022

We have served as the Company’s auditor since 2021.

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Fast Radius Operations, Inc.

CONSOLIDATED BALANCE SHEETS

	December 31, 2021			December 31, 2020
Assets
Current assets
Cash and cash equivalents	$	8,701,895		$	18,494,248
Accounts receivable, net of allowances for doubtful accounts of $929,800 and $404,755, respectively		7,015,278			5,046,497
Inventories		448,771			274,311
Prepaid production costs		986,498			283,553
Prepaid expenses and other current assets		4,422,307			623,292
Total current assets	$	21,574,749		$	24,721,901
Non-current assets
Property and equipment, net		9,528,427			2,664,366
Other non-current assets		534,915			336,923
Total assets	$	31,638,091		$	27,723,190
Liabilities, temporary equity and stockholders’ deficit
Current liabilities
Accounts payable	$	3,987,129		$	1,528,790
Accrued compensation		3,096,556			1,350,539
Accrued and other liabilities		11,610,233			167,384
Advances from customers		258,089			25,012
Accrued liabilities – related parties		2,513,347			1,313,062
Deferred revenue		—			5,350
Warrant liability		2,968,435			199,408
Current portion of long-term debt		13,265,588			413,930
Total current liabilities	$	37,699,377		$	5,003,475
Other long-term liabilities		396,258			—
Term loans - net of current portion and debt issuance costs		16,775,836			314,389
Related party convertible notes and derivative liabilities		16,856,558			—
Total liabilities	$	71,728,029		$	5,317,864
Commitments and contingencies (Note 11)					—
Temporary equity
Series Seed Preferred stock; par value $0.0001, 400,000 shares authorized; 400,000 shares issued and outstanding as of December 31, 2021 and December 31, 2020, aggregate liquidation preference of $1,892,812 as of December 31, 2021 and December 31, 2020	$	1,892,812		$	1,892,812
Series Seed - 1 Preferred stock; par value $0.0001, 515,779 shares authorized; 515,779 shares issued and outstanding as of December 31, 2021 and December 31, 2020; aggregate liquidation preference of $2,892,300 as of December 31, 2021 and December 31, 2020		2,892,300			2,892,300
Series A - 1 Preferred stock; par value $0.0001, 5,706,349 shares authorized; 5,706,349 shares issued and outstanding as of December 31, 2021 and December 31, 2020; aggregate liquidation preference of $5,714,281 as of December 31, 2021 and December 31, 2020		5,714,281			5,714,281
Series A - 2 Preferred stock; par value $0.0001, 2,574,478 shares authorized; 2,574,478 shares issued and outstanding as of December 31, 2021 and December 31, 2020; aggregate liquidation preference of $2,778,882 as of December 31, 2021 and December 31, 2020		2,778,882			2,778,882
Series A - 3 Preferred stock; par value $0.0001, 2,713,324 shares authorized; 2,621,569 shares issued and outstanding as of December 31, 2021 and December 31, 2020; aggregate liquidation preference of $4,285,715 as of December 31, 2021 and December 31, 2020		4,285,715			4,285,715
Series B Preferred stock; par value $0.0001, 5,131,673 shares authorized; 4,205,059 shares issued and outstanding as of December 31, 2021 and December 31, 2020, respectively; aggregate liquidation preference of $56,726,260 as of December 31, 2021 and December 31, 2020, respectively		56,726,260			56,726,260
Total temporary equity	$	74,290,250		$	74,290,250
Stockholders’ deficit
Common Stock, $0.0001 par value, 31,000,000 authorized; 4,039,535 and 3,427,555 shares issued and outstanding as of December 31, 2021 and December 31, 2020, respectively		404			343
Treasury Stock, held at cost; 650,000 shares outstanding as of December 31, 2021 and December 31, 2020		(221,000	)		(221,000	)
Additional paid-in capital		9,112,781			3,724,208
Accumulated deficit		(123,272,373	)		(55,388,475	)
Total stockholders’ deficit		(114,380,188	)		(51,884,924	)
Total liabilities, temporary equity and stockholders’ deficit	$	31,638,091		$	27,723,190

See accompanying notes to the consolidated financial statements.

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Fast Radius Operations, Inc.

CONSOLIDATED STATEMENTS OF NET LOSS AND COMPREHENSIVE LOSS

For the years ended	December 31, 2021			December 31, 2020
Revenues	$	20,012,064		$	13,966,251
Cost of revenues		20,299,677			12,038,769
Gross profit		(287,613	)		1,927,482
Operating expenses
Sales and marketing		22,721,423			8,327,910
General and administrative		32,974,231			12,043,879
Research and development		5,035,963			2,959,330
Total operating expenses		60,731,617			23,331,119
Loss from operations		(61,019,230	)		(21,403,637	)
Change in fair value of warrants		(1,781,280	)		(80,040	)
Change in fair value of derivative liability		(208,000	)		—
Interest income and other income		1,318			120,549
Interest expense, including amortization of debt issuance costs		(4,876,706	)		(308,266	)
Loss before income taxes		(67,883,898	)		(21,671,394	)
Income tax expense (benefit)		—			—
Net loss and comprehensive loss	$	(67,883,898	)	$	(21,671,394	)
Net loss per share
Basic and diluted	$	(16.40	)	$	(7.34	)
Weighted average shares outstanding:
Basic and diluted		4,139,275			2,950,556

See accompanying notes to the consolidated financial statements.

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Fast Radius Operations, Inc.

CONSOLIDATED STATEMENTS OF TEMPORARY EQUITY AND STOCKHOLDERS’ DEFICIT

	Convertible Preferred Stock1				Common Stock				Treasury Stock						Additional paid- in capital		Accumulated Deficit			Total
	Shares		Amount		Shares		Amount		Shares			Amount			Amount		Amount			Amount
Balance at January 1, 2020		15,430,205	$	66,290,289		1,194,163	$	119		(650,000	)	$	(221,000	)	$	2,525,228	$	(33,717,081	)	$	(31,412,734	)
Net loss																		(21,671,394	)		(21,671,394	)
Issuance of equity warrants																200,373					200,373
Issuance preferred stock (Series B)		593,029		7,999,961
Exercise of stock options and release of notes’ recourse provision						2,233,392		224								6,527					6,751
Stock-based compensation																992,080					992,080
Balance at December 31, 2020		16,023,234	$	74,290,250		3,427,555	$	343		(650,000	)	$	(221,000	)	$	3,724,208	$	(55,388,475	)	$	(51,884,924	)
Balance at January 1, 2021		16,023,234	$	74,290,250		3,427,555	$	343		(650,000	)	$	(221,000	)	$	3,724,208	$	(55,388,475	)	$	(51,884,924	)
Net loss																		(67,883,898	)		(67,883,898	)
Issuance of equity warrants to related party																2,200,658					2,200,658
Issuance of equity warrants																2,245,000					2,245,000
Exercise of stock options and release of notes’ recourse provision						611,980		61								87,519					87,580
Stock-based compensation																855,396					855,396
Balance at December 31, 2021		16,023,234		74,290,250		4,039,535		404		(650,000	)		(221,000	)		9,112,781		(123,272,373	)		(114,380,188	)

See accompanying notes to the consolidated financial statements

¹ Refer to Note 7

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Fast Radius Operations, Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the years ended	December 31, 2021			December 31, 2020
Cash flows from operating activities
Net loss	$	(67,883,898	)	$	(21,671,394	)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization		1,653,318			841,736
Amortization of deferred financing fees and convertible debt discount		3,484,753			116,857
Stock-based compensation		855,396			992,082
Compensation expense related to equity classified warrants		—			200,373
Change in fair value of warrants		1,781,280			80,040
Change in fair value of derivative liability		208,000			—
Provision for doubtful accounts		641,357			710,882
Loss on disposal of assets		227,800			—
Changes in operating assets and liabilities
Accounts receivable		(2,610,138	)		(1,840,412	)
Inventories		(174,460	)		(12,676	)
Prepaid production costs		(702,945	)		96,734
Prepaid expenses and other current assets		(3,311,925	)		(635,941	)
Accounts payable		2,335,077			(138,229	)
Accrued compensation and other liabilities		14,785,409			550,733
Advances from customers		233,077			(85,466	)
Deferred revenue		(5,350	)		(102,845	)
Other		(287,872	)		(6,250	)
Cash used in operating activities	$	(48,771,121	)	$	(20,903,776	)
Cash flows from investing activities
Additions to property, plant and equipment		(8,621,917	)		(711,727	)
Cash used in investing activities	$	(8,621,917	)	$	(711,727	)
Cash flows from financing activities
Proceeds from term loans	$	31,486,824			427,615
Repayment of term loans		(948,928	)		(3,140,783	)
Proceeds from convertible notes and warrants with related parties		17,600,000			—
Proceeds from temporary equity contributions		—			7,999,961
Convertible notes issuance costs		(124,791	)		—
Proceeds from exercise of stock options		87,580			6,750
Payment of deferred financing costs		(500,000	)		—
Cash provided by financing activities	$	47,600,685		$	5,293,543
Change in cash and cash equivalents		(9,792,353	)		(16,321,960)
Cash and cash equivalents, beginning of period		18,494,248			34,816,208
Cash and cash equivalents, end of period	$	8,701,895		$	18,494,248
Supplemental disclosure of cash flow information
Issuance of liability classified warrants in connection with debt	$	987,747		$	86,963
Issuance of equity classified warrants in connection with debt	$	4,445,658		$	—
Capital expenditures not yet paid	$	239,261		$	116,000
Interest paid	$	854,078		$	110,420

See accompanying notes to the consolidated financial statements.

6

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Note 1 – Nature of Operations and Basis of Presentation

Fast Radius Operations, Inc., which was incorporated in the United States in 2017 (“Fast Radius” or the “Company”), is a cloud manufacturing and digital supply chain company. The Fast Radius solution combines a proprietary software platform with physical infrastructure to enable accelerated product development and digital tools for product engineers.

The Company is headquartered in Chicago, Illinois, with additional operating locations in Atlanta, Georgia; Louisville, Kentucky; and Singapore. The Company’s operations in Louisville, Kentucky are located within the Worldport facility of United Parcel Service, Inc. (“UPS”), enabling parts to be produced and shipped late into the evening for overnight distribution around the world. The Company has an operating subsidiary located in Singapore.

On July 18, 2021, ECP Environmental Growth Opportunities Corp., a Delaware corporation (“ENNV”), and ENNV Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of ENNV (“Merger Sub”), entered into an Agreement and Plan of Merger (as it was amended, supplemented or otherwise modified from time to time in accordance with its terms, the “Merger Agreement”) with Fast Radius, pursuant to which Merger Sub will merge with and into Fast Radius, with Fast Radius surviving the merger as a wholly owned subsidiary of ENNV (the “Merger” and, together with the other transactions contemplated by the Merger Agreement, the “Business Combination”).

On February 4, 2022, pursuant to the Merger Agreement, Fast Radius consummated the Business Combination. Subject to the terms of the Merger Agreement, all of the issued and outstanding shares of Fast Radius were converted into an aggregate of (i) 65,000,000 shares of Common Stock, par value $0.0001 per share, of ENNV at a deemed value of $10.00 per share (including 11,196,271 shares of 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. The transaction provided all holders of the Company’s Common Stock with shares of Common Stock of the continuing public company. Upon close of the Business Combination, ENNV changed its name to Fast Radius, Inc. and the Company changed its name to Fast Radius Operations, Inc. As of December 31, 2021, the Company capitalized $3.6 million in direct and incremental equity issuance-related transaction costs within prepaid expenses and other current assets on the consolidated balance sheet, of which $3.1 million was not yet paid as of December 31, 2021 and was presented within accrued and other liabilities on the consolidated balance sheet.

The Company’s basis of presentation within these consolidated financial statements do not reflect any adjustment as a result of the Merger closing. The Merger will be accounted for as a reverse recapitalization. Under this method of accounting, Fast Radius will be treated as the accounting acquirer for financial reporting purposes. Refer to Note 15 for further information regarding the Business Combination.

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). No transactions have been recorded to accumulated other comprehensive income or loss through December 31, 2021.

Principles of Consolidation

The Company’s consolidated financial statements reflect its financial statements and those of its wholly owned subsidiary. All intercompany transactions and balances have been eliminated in consolidation.

Risks and Uncertainties

The Company is subject to a number of risks similar to those of other companies of similar size in its industry, including, but not limited to, the need for successful development of products, new customer acquisition, the need for

7

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

additional funding, competition from substitute products and services from larger companies, protection of proprietary technology, dependence on key individuals, and risks associated with changes in information technology. The Company has financed its operations through issuances of debt and preferred stock since inception. The Company’s long-term success is dependent upon its ability to successfully market its products and services; grow revenue; control operating costs and expenses; meet its obligations; obtain additional capital when needed; and, ultimately, achieve profitable operations.

COVID-19 Impact

In March 2020, the World Health Organization declared the outbreak of the new strain of the coronavirus (“COVID-19”) to be a pandemic. The COVID-19 pandemic is having widespread, rapidly evolving, and unpredictable impacts on global society, economies, financial markets, and business practices. Federal and state governments have implemented measures in an effort to contain the virus, including social distancing, travel restrictions, border closures, limitations on public gatherings, work from home, supply chain logistical changes, and closure of non-essential businesses. To protect the health and well-being of its employees, suppliers, and customers, the Company has made substantial modifications to employee travel policies, implemented office closures as employees are advised to work from home, and cancelled or shifted its conferences and other events to virtual-only through the date of these consolidated financial statements. The COVID-19 pandemic has impacted and may continue to impact the Company’s business operations, including its employees, customers, partners, and communities, and there is substantial uncertainty in the nature and degree of the pandemic’s continued effects over time. COVID-19 and other similar outbreaks, epidemics or pandemics could have a material adverse effect on the Company’s business, financial condition, results of operations, cash flows and prospects as a result of any of the risks described above and other risks that the Company is not able to predict.

Going Concern Consideration

The accompanying consolidated financial statements are prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

Since inception, the Company has generated recurring losses which have resulted in an accumulated deficit of $123.3 million and $55.4 million as of December 31, 2021 and December 31, 2020, respectively, and expects to incur additional losses in the future. The Company is still in the growth stage of its business and expects to continue to make substantial investments in its business, including in the expansion of its product portfolio and 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 Business Combination and the private placement that occurred substantially concurrently with the consummation of the Business Combination (the “PIPE Investment”), are not sufficient to meet its working capital and capital expenditure requirements for a period of at least twelve months from the date of the issuance of these financial statements. As a result of the Company’s 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. The Company has concluded that management’s plans do not alleviate substantial doubt about the Company’s ability to continue as a going concern.

8

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.

Note 2 – Summary of Significant Accounting Policies

Emerging Growth Company

As an emerging growth company (“EGC”), the Jumpstart Our Business Startups Act (“JOBS Act”) allows the Company to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are applicable to private companies. The Company has elected to use this extended transition period under the JOBS Act until such time the Company is no longer considered to be an EGC. The adoption dates discussed below reflect this election.

Use of Estimates

The preparation of the consolidated interim financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, related disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses for the periods presented. The Company’s most significant estimates and judgements involve valuation of the Company’s debt and equity securities, including assumptions made in the fair value of warrants, derivatives, and stock-based compensation; the useful lives of fixed assets; and allowances for doubtful accounts. Although the Company regularly assesses these estimates, actual results could differ materially from these estimates. Changes in estimates are recorded in the period in which they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. Actual results may differ from management’s estimates if these results differ from historical experience or other assumptions prove not to be substantially accurate, even if such assumptions are reasonable when made.

Segment Information

The Company operates and manages its business as one operating and reportable segment. The Company’s chief executive officer, who is the chief operating decision maker, reviews financial information on an aggregate basis for purposes of evaluating financial performance and allocating resources. The Company’s long-lived assets and customers are all substantially located in the United States.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of 90 days or less, or with the ability to redeem amounts on demand, to be cash and cash equivalents. The carrying amount of cash equivalents are reported at cost, which approximates their fair value.

Accounts Receivable

In evaluating the collectability of accounts receivable, the Company assesses a number of factors, including specific customers’ abilities to meet their financial obligations, the length of time a receivable is past due, and historical collection experience. If circumstances related to specific customers change, or economic conditions deteriorate such that the Company’s past collection experience is no longer relevant, its estimate of the recoverability of accounts receivable could be further reduced from the levels provided for in the consolidated financial statements. All accounts or portions thereof considered uncollectible are written off to the allowance for doubtful accounts in the period this information becomes known. Recoveries of trade receivables previously written off are recorded when received.

9

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The components of accounts receivable are as follows:

	December 31, 2021			December 31, 2020
Trade receivables	$	7,945,078		$	5,451,252
Allowance for doubtful accounts		(929,800	)		(404,755	)
Total accounts receivable	$	7,015,278		$	5,046,497

The following table summarizes activity in the allowance for doubtful accounts:

	December 31, 2021			December 31, 2020
Balance at beginning of period	$	(404,755	)	$	(190,205	)
Provision for uncollectible accounts		(641,357	)		(710,882	)
Uncollectible accounts written off		116,312			496,332
Balance at end of period	$	(929,800	)	$	(404,755	)

Significant Customers and Concentration of Credit Risks

The Company is subject to credit risk primarily through its accounts receivable. Credit is extended to customers based on a credit review. The credit review considers each customer’s financial condition, including the customer’s established credit rating or the Company’s assessment of the customer’s creditworthiness based on their financial statements absent a credit rating, local industry practices, and business strategy. A credit limit and terms are established for each customer based on the outcome of this review. The Company performs on- going credit evaluations of its customers and maintains allowances for potential credit losses which, when realized, have been within the range of management’s expectations. The Company generally does not require collateral. The Company regularly evaluates the credit risk of its customers.

Significant customers are those that represent more than 10% of the Company’s total revenue or accounts receivable. For the customers identified, revenue as a percentage of total revenue and accounts receivable as a percentage of net accounts receivable are as follows:

	December 31, 2021			December 31, 2020
Revenue for the years ended
Customer A		<10	%		21.6	%

	December 31, 2021			December 31, 2020
Accounts receivable
Customer A		<10	%		24.2	%
Customer B		<10	%		13.3	%

10

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Inventories

The Company’s inventories consist of raw materials, work-in-process, and finished goods, and costs incurred directly or indirectly in production, which includes labor and overhead. Certain items in inventory require limited assembly procedures to be performed before shipping the items to customers. Inventories are stated at the lower of cost and net realizable value. As virtually all inventory is made to customers’ specific orders, finished goods inventory is typically shipped to the customer upon completion.

Inventories consisted of the following:

	December 31, 2021		December 31, 2020
Raw materials	$	432,461	$	162,397
Work-in-process		16,310		107,770
Finished goods		—		4,144
Total Inventories	$	448,771	$	274,311

Cost is determined using the weighted-average method. The Company performs on-going evaluations and records adjustments for slow-moving and obsolete items, based upon factors surrounding the inventory age, amount of inventory on hand and projected sales. Inventory provisions based on obsolescence and inventory in excess of forecasted demand are recorded through cost of revenues in the consolidated statements of net loss and comprehensive loss.

Property and Equipment, net

The Company’s property and equipment primarily consists of advanced manufacturing machinery, quality measurement equipment, other manufacturing infrastructure, office equipment and furniture, computer hardware, internally developed software, and networking equipment. Depreciation is computed using the straight-line method over the estimated useful life by asset category, or in the case of leasehold improvements, the shorter of the lease term including any renewal periods reasonably assured to be exercised at inception, or the estimated useful life of the asset category. Repairs and maintenance are expensed as incurred, while betterments and improvements that the Company determines extend the useful life or add functionality of property and equipment are capitalized. Property and equipment are depreciated over the estimated useful life of the asset categories as follows:

Advanced Manufacturing Machinery & Quality Equipment	5 – 10 Years
Computer & Office Hardware	5 Years
Furniture & Fixtures	7 Years
Internally Developed Software	3 – 5 years
Leasehold Improvements	Lesser of lease term or estimated useful life

The Company periodically reviews each asset category’s estimated useful life based upon actual experience and expected future utilization. A change in useful life is treated as a change in accounting estimate and is applied prospectively.

The Company reviews the carrying amounts of property and equipment for potential impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In evaluating recoverability, the Company groups assets and liabilities at the lowest level such that the identifiable cash flows

11

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

relating to the group are largely independent of the cash flows of other assets and liabilities, which are each determined to be an asset group. The Company then compares the carrying amount of each asset group to the estimated undiscounted future cash flows attributable to the asset group. If the estimated undiscounted future cash flows for the asset group are not at least equal to the carrying amount, the Company estimates the fair value

of the asset group and an impairment charge is recorded at the amount by which the carrying amount of the asset or asset group exceeds the fair value, if applicable. In addition, the remaining depreciation period for the impaired asset or asset group would be reassessed and, if necessary, revised. For the years ended December 31, 2021 and December 31, 2020, the Company did not recognize any impairment of its property and equipment. Refer to Note 4 for further information regarding property and equipment.

Software applications developed for internal use are capitalized as internally developed software. Costs are capitalized when: (i) the preliminary project stage is completed (i.e., the application development stage) and (ii) it is probable that the software will be completed and used for its intended function. The Company also capitalizes costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality. Costs incurred for maintenance, minor upgrades and enhancements are expensed as incurred within general and administrative expense in the consolidated statements of net loss and comprehensive loss.

Debt and Deferred Financing Fees

Debt discounts are presented on the balance sheet as a direct deduction from the carrying amount of that related debt. Refer to Note 5 for further information regarding debt.

Costs incurred in connection with the Company’s debt instruments consist principally of debt issuance costs and have been deferred and are being amortized over the terms of the related debt agreements using the effective interest method. Deferred financing fees are presented on the consolidated balance sheets as direct reductions to debt balances.

Research and Development Costs

Management invests resources to advance the development of its products and services for its customers, including the development of the cloud manufacturing software platform. Research and development costs represent costs incurred to support the advancement of new product platforms, consumables, and activities to enhance manufacturing capabilities. Research and development costs are comprised of prototype parts, design expense, employee-related personnel expense, and an allocated portion of overhead costs. Research and development costs are expensed as incurred.

Net Loss Per Share

The Company applies the two-class method to compute basic and diluted net loss per share attributable to Common Stockholders when shares meet the definition of participating securities. The two-class method determines net loss per share for each class of common and redeemable convertible preferred stock according to dividends declared or accumulated and participation rights in undistributed earnings. The two-class method requires income (loss) available to Common Stockholders for the period to be allocated between common and redeemable convertible preferred stock based upon their respective rights to share in the earnings as if all income (loss) for the period had been distributed. During periods of loss, there is no allocation required under the two-class method since the redeemable convertible preferred stock does not have a contractual obligation to share in the Company’s losses.

Basic net loss per share attributable to stockholders is computed by dividing net loss attributable to the Company’s stockholders by the weighted-average number of common shares outstanding during the period without consideration of potentially dilutive Common Stock. Diluted net loss per share attributable to the Company’s stockholders reflects the potential dilution that could occur if securities or other contracts to issue Common Stock were exercised or

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

converted into Common Stock or resulted in the issuance of Common Stock that then shared in the earnings of the Company unless inclusion of such shares would be anti-dilutive. For periods in which the Company reports net losses, diluted net loss per common share attributable to the Company’s stockholders is the same as basic net loss per common share attributable to the Company’s stockholders, because potentially dilutive common shares are not assumed to have been issued if their effect is anti-dilutive. Refer to Note 14 for further information regarding net loss per share.

Advertising Costs

Advertising costs are expensed as incurred. Advertising expenses consist primarily of media advertising costs, trade and customer marketing expenses, sales and marketing related personnel, and public relations expenses which aim to strengthen the leadership of the Company’s brand in key vertical markets. Advertising costs were approximately $7.9 million and $1.2 million for the years ended December 31, 2021 and 2020, respectively. All advertising expenses are recorded in Sales and marketing expense in the consolidated statements of net loss and comprehensive loss.

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and net operating loss and tax credit carry forwards. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of net loss and comprehensive loss in the period that includes the enactment date. Deferred income tax assets are reduced by a valuation allowance when it is more likely than not that some portion of the deferred income tax assets will not be realized. The Company does not have any uncertain tax positions.

A valuation allowance is provided unless it is more likely than not that the deferred tax asset will be realized. Assessing whether deferred tax assets are realizable requires significant judgement. In the determination of the appropriate valuation allowance, the Company considers future reversals of existing taxable temporary differences, the most recent projections of future business results, prior earnings history, carry back and carry forward periods, and prudent tax strategies. Assessments for the realization of deferred tax assets made at a given balance sheet date are subject to change in the future. Refer to Note 6 for further information regarding income taxes.

Stock-Based Compensation—Options, RSUs and Warrants

The Company accounts for stock-based compensation awards in accordance with Financial Accounting Standards Board (“FASB”) ASC 718, Compensation—Stock Compensation (“ASC 718”). ASC 718 requires all stock-based payments to employees and nonemployees, including grants of stock options, restricted stock, restricted stock units (“RSUs”), and modifications to existing stock awards, to be recognized in the statements of net loss and comprehensive loss based on their fair values. The Company’s stock-based awards are comprised of stock options and RSUs. The Company estimated the fair value of its Common Stock options when granted using the Black Scholes option-pricing model and RSUs when granted using the estimated Common Stock value.

The Company’s stock-based awards are subject to service and/or performance-based vesting conditions. The Company recognizes compensation expenses for awards with only a service condition over the explicit service period using the straight-line method. For awards subject to a service and performance condition, compensation cost is recognized over the longer of the explicit, implicit, or derived period using the accelerated attribution method for cost allocation, as long as the performance condition is probable of achievement. At each reporting period, the Company evaluates the probability that its performance-based stock options will be earned and adjusts its previously

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recognized compensation expense as necessary. If the achievement of the respective performance metrics is not probable or the respective performance goals are not met, the Company reverses its previously recognized compensation expense. In accordance with ASC 718, excess tax benefits realized from the exercise of stock-based awards are classified as cash flows from operating activities. All excess tax benefits and tax deficiencies (including tax benefits of dividends on share-based payment awards) are recognized as income tax expense or benefit in the consolidated statements of net loss and comprehensive loss.

The Company accounts for stock-based compensation awards issued to nonemployees for services, as prescribed by ASC 718, at either the fair value of the services rendered or the instruments issued in exchange for such services, whichever is more readily determinable using the measurement date guidelines enumerated in Accounting Standards Update (“ASU”) 2018-07, Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”).

The Company has elected to account for forfeitures as they occur for both employee and nonemployee awards. Refer to Note 9 for further information regarding stock-based compensation.

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A hierarchy has been established for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available.

The Company has determined the estimated fair value of its financial instruments including stock-based awards, derivatives, and certain warrants, which are accounted for as liabilities, based on appropriate valuation methodologies; however, considerable judgment is required to develop these estimates. Accordingly, these estimated fair values are not necessarily indicative of the amounts the Company could realize in a current market exchange. The estimated fair values can be materially affected by using different assumptions or methodologies.

The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents represent cost, which approximates fair value. The carrying amounts reported in the consolidated balance sheets for accounts receivable, accounts payable, and accrued liabilities approximate fair value due to their short-term maturities. With the exception of the Company’s Related Party Convertible Notes, the fair value of the Company’s debt approximates their carrying values based on the variable nature of interest rates and current market rates available. The Company considers its debt to be a Level 3 measurement in the fair value hierarchy as significant judgment is involved to determine the fair value of embedded conversion features. Refer to Note 10 for further information regarding fair value.

Redeemable Convertible Preferred Stock

The Series Seed, Seed-1, A-1, A-2, A-3, and B Convertible Preferred Stock (collectively the “Preferred Stock”) are classified in temporary equity as they contain terms that could force the Company to redeem the shares for cash or other assets upon the occurrence of an event not solely within the Company’s control. The Company adjusts the carrying values of the Preferred Stock each reporting period to the redemption value inclusive of any declared and unpaid dividends. As of December 31, 2021 and 2020, no adjustments to the Preferred Stock carrying values were required as no dividends had been declared. Refer to Note 7 for further information.

Warrants

The Company accounts for its warrants issued with other debt and equity instruments in accordance with ASC 480, Distinguishing Liabilities from Equity (“ASC 480”), and ASC 718. In the event the terms of the warrants qualify for classification as a liability rather than equity, the Company accounts for the instrument as a liability recorded at fair value each reporting period with the change in fair value recognized through earnings. Refer to Note 8 for further information regarding warrants.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Treasury stock

Treasury stock purchases are accounted for under the cost method whereby the entire cost of the acquired stock is recorded as treasury stock. Gains, and losses to the extent that gains were previously recorded, on the subsequent reissuance of shares are credited or charged to paid-in capital in excess of par value using the average-cost method. Any losses in excess of previously recorded gains are charged to accumulated deficit.

Revenue Recognition

The Company determines revenue recognition through the following steps:

• Identification of the contract, or contracts, with a customer;

• Identification of the performance obligations in the contract;

• Determination of the transaction price;

• Allocation of the transaction price to the performance obligations in the contracts; and

• Recognition of revenue when, or as, the Company satisfies a performance obligation

The Company’s primary source of revenue is from product sales of manufactured parts. Fast Radius has contracts with customers where the transfer of control of the specified good varies from contract to contract, but predominantly occurs upon shipment. The Company does not act as an agent in any of its revenue arrangements. Fast Radius seldom offers assurance-type warranties in the ordinary course of business; however, when such warranties are included, they generally have a service life of four years beginning from the date of product purchase. In the event of a failure of products covered under the warranties, the Company may repair or replace the products at the customer’s discretion. As of December 31, 2021 and 2020, the Company has not incurred any warranty related costs related to products covered by this warranty.

The Company also derives revenue from consulting agreements, in which the Company produces digital assets (CAD files) and physical assets (prototypes). For consulting contracts, the deliverables are combined to be one performance obligation within the context of the contract, and revenue is recognized over time or at a point-in- time based on contract terms. Revenue is recognized over time when the customer legally controls the work-in- process associated with the Company’s performance. Revenue is measured by the costs incurred to date relative to the estimated total direct costs to fulfill each contract (cost-to-cost method). Incurred costs represent work performed, which corresponds with, and thereby best depicts, the transfer of control to the customer. Contract costs include hourly labor, materials, and overhead. Otherwise revenues are recognized at a point-in-time when control has transferred to the customer.

Payments are generally due within a range of 30 to 90 days after the performance obligation has been satisfied. Revenue from consulting agreements is not material.

The Company charges certain customers shipping and handling fees. These fees are recorded within revenue after transfer of control of the products to customers. Revenues related to shipping and handling were $0.8 million and $0.4 million in 2021 and 2020, respectively. When shipping and handling services are performed before transfer of control to customers, they are accounted for as a fulfillment cost and are included in cost of revenues as incurred.

The Company will contract with third parties to produce certain components of a customer order. Costs paid in advance of production are recorded in current assets as prepaid production costs until control of the product is transferred to the customer. Under such outsourced manufacturing arrangements, the Company is the primary obligor to its customer.

Contract liabilities consist of fees paid by the Company’s customers for which the associated performance obligations have not been satisfied and revenue has not been recognized based on the Company’s revenue recognition criteria described above.

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Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Contract assets are recorded when the Company has a right to consideration in exchange for goods or services that it has transferred to a customer but for which payment is conditional on more than just the passage of time. Given the nature of the Company’s contracts, the Company did not have any contract assets as of December 31, 2021 or 2020, respectively. Refer to Note 3 for further information regarding revenue.

Leases

The Company leases certain equipment, office space and its corporate headquarters under non-cancelable lease agreements which are accounted for as operating leases. The Company recognizes operating lease minimum rentals on a straight-line basis over the lease term. Executory costs such as real estate taxes and maintenance, and contingent rentals based on the volume of actual utilization are recognized as incurred. The difference between cash rent payments and the recognition of straight-line rent expense is recorded as deferred rent. The Company records deferred rent in other non-current liabilities on the consolidated balance sheets. The lease term, which includes all renewal periods that are considered to be reasonably assured of being exercised, begins on the date the Company has access to the leased asset. Refer to Note 11 for further information regarding leases.

Recently issued accounting pronouncements

Recently Adopted Accounting Pronouncements

In August 2018, the FASB issued ASU No. 2018-15, Intangibles — Goodwill and Other — Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The standard was effective for annual reporting periods beginning after December 15, 2020 and interim periods within annual periods beginning after December 15, 2021. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements.

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, which simplifies accounting for convertible instruments. More convertible debt instruments will be reported as a single liability instrument and more convertible preferred stock as a single equity instrument with no separate accounting for embedded conversion features. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for the exception. The ASU also simplifies the diluted EPS calculation in certain circumstances. The ASU is effective for smaller reporting companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2023. Early adoption is permitted for all entities for fiscal years beginning after December 15, 2020. The ASU allows entities to use either a modified retrospective or full retrospective transition method. The Company early adopted this standard effective January 1, 2021 noting no material effects on its consolidated financial statements.

Recently Issued Accounting Pronouncements not yet adopted as of December 31, 2021

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740)—Simplifying the Accounting for Income Taxes, which simplifies the accounting for income taxes by eliminating some exceptions to the general approach in ASC 740, Income Taxes. It also clarifies certain aspects of the existing guidance to promote more consistent application. This standard is effective for calendar-year private companies with fiscal years beginning after December 15, 2022 and interim periods within that year, and early adoption is permitted. The Company is currently in the process of evaluating the impact the new standard will have on its consolidated financial statements.

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Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

In February 2016, the FASB issued ASU 2016-02, Leases (“ASC 842”), which requires lessees to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months. Recognition, measurement and presentation of expenses will depend on classification of the lease as a finance or operating lease. On April 8, 2020, the FASB, pursuant to ASU 2020-05, voted to defer the effective date for ASC 842 for one year. For private companies, the leasing standard will be effective for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022. Early adoption is permitted. The Company is in the process of evaluating the effects of adopting this ASU on its consolidated financial statements.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses: Measurement of Credit Losses on Financial Instruments, and subsequent related amendments, which requires the use of a new current expected credit loss (“CECL”) model in estimating allowances for doubtful accounts with respect to accounts receivable and notes receivable. Receivables from revenue transactions, or trade receivables, are recognized when the corresponding revenue is recognized under ASC 606. The CECL model requires that the Company estimate its lifetime expected credit loss with respect to these receivables and record allowances which are deducted from the balance of the receivables, which represent the estimated net amounts expected to be collected. Given the generally short-term nature of trade receivables, the Company does not expect to apply a discounted cash flow methodology. However, the Company will consider whether historical loss rates are consistent with expectations of forward-looking estimates for its trade receivables. This ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within those fiscal years. The Company is in the process of evaluating the effects of adopting this ASU on its consolidated financial statements.

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Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3 - REVENUES

The Company charges certain customers shipping and handling fees. These fees are recorded within revenue when incurred after transfer of control of the products to customers. Revenues related to shipping and handling fees were $0.8 million and $0.4 million for the years ended December 31, 2021 and 2020, respectively. When shipping and handling services are performed before transfer of control to customers, they are accounted for as a fulfillment cost and are included in cost of revenues when incurred.

The Company will contract with third parties to produce certain components of a customer order. Costs paid in advance of production are recorded in current assets as prepaid production costs until control of the product is transferred to the customer. Under such outsourced manufacturing arrangements, the Company is the primary obligor to its customer.

Contract assets are recorded when the Company has a right to consideration in exchange for goods or services that it has transferred to a customer but for which payment is conditional on more than just the passage of time. Contract liabilities consist of fees paid by the Company’s customers for which the associated performance obligations have not been satisfied and revenue has not been recognized based on the Company’s revenue recognition criteria. The Company did not have any contract assets as of December 31, 2021 or 2020, respectively. Deferred revenue (contract liabilities) is recognized when a customer pays consideration before the Company transfers goods or provide services and was $5 thousand as of December 31, 2020. There were no contract liabilities as of December 31, 2021. During the year ended December 31, 2021, the amount of revenue recognized that was included in deferred revenue as of December 31, 2020 was not significant.

Disaggregation of Revenues

The Company’s primary sources of revenue are from one revenue stream, product sales of manufactured parts. The Company is also presenting a disaggregation of revenue by geographical region (based on the external customer’s location) for the years ended December 31, 2021 and 2020:

	Years Ended December 31,
	2021		2020
Revenues
Americas	$	18,947,044	$	12,946,158
Europe		499,294		476,087
Asia Pacific		565,726		544,006
Total	$	20,012,064	$	13,966,251

NOTE 4 – PROPERTY AND EQUIPMENT

Property and equipment, net, consisted of the following:

	December 31, 2021			December 31, 2020
Advanced manufacturing machinery & quality equipment	$	5,705,034		$	3,016,377
Software		2,912,107			—
Computer & office hardware		1,148,944			657,972
Furniture and fixtures		38,473			34,753
Leasehold improvements		3,048,419			699,278
Total property and equipment	$	12,852,977		$	4,408,380
Less: accumulated depreciation and amortization		(3,324,550	)		(1,744,014	)
Property and equipment (Net)	$	9,528,427		$	2,664,366

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Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Depreciation and amortization expense for the years ended December 31, 2021 and 2020, was $1.7 million and $0.8 million, respectively.

NOTE 5 –DEBT

The following is a summary of short- and long-term debt:

	December 31, 2021			December 31, 2020
2018 ATEL Loan	$	—		$	359,594
2020 MFS Loan		314,637			384,604
Manufacturers Capital Promissory Notes		967,710			—
Related Party - Energize Convertible Debt		7,600,000			—
2020 SVB Loan		10,225,000			—
2021 SVB Loan		20,800,000			—
Related Party - Drive Capital Convertible Debt		3,000,000			—
Related Party - ECP Holdings Convertible Debt		7,000,000			—
Total Outstanding Principal	$	49,907,347		$	744,198
Less: Discounts		(6,816,026	)		—
Less: Deferred financing fees		(588,339	)		(15,879	)
Total Outstanding debt	$	42,502,982		$	728,319
Fair value of derivatives		4,395,000			—
Total Debt and derivative liabilities	$	46,897,982		$	728,319

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Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The following is the summary of future principal repayments of debt:

	Amounts
2022	$	15,059,584
2023		30,690,676
2024		3,949,970
2025		207,117
Total	$	49,907,347

2018 ATEL Loan

On October 4, 2018, the Company entered into a credit agreement with ATEL Ventures (“ATEL”) with a principal amount up to $3.0 million to finance equipment purchases (hereafter referred to as the “ATEL Loan”). All advances under the agreement are collateralized by the specific equipment financed in accordance with the agreement terms. On December 31, 2018, the Company financed the acquisition of advanced manufacturing equipment and machinery in the amount of $1.1 million. The loan required 36 monthly payments of principal and interest, with a maturity date of November 1, 2021. The loan did not have a stated interest rate; therefore, the Company calculated the imputed interest rate using the Yield-to-Maturity (YTM) method. The imputed interest rate for the periods ended December 31, 2021 and 2020, was approximately 5.8% and 5.6%, respectively. In conjunction with the agreement, the Company issued a warrant to ATEL to purchase up to 91,755 shares of the Company’s Series A-3 Preferred Stock. As the Company only borrowed one-third of the total available financing, only one- third of the total 91,755 warrants were granted. These warrants are accounted for pursuant to ASC 480. As of December 31, 2021, the Company has issued 32,405 warrants to ATEL in conjunction with the debt agreement. The agreement includes provisions allowing for an optional prepayment, default interest, and acceleration upon events of default that are outlined within the agreement. On November 1, 2021, the ATEL loan was paid in full, including the outstanding interest and principal balance.

2018 SVB Loan

On October 12, 2018, the Company entered into a term loan agreement with Silicon Valley Bank (“SVB”) for $3.0 million (hereafter referred to as the “2018 SVB loan”). The term loan required monthly payments of principal and interest, with all remaining principal and interest due on September 1, 2022. The term loan had an interest rate of prime rate + 1.25%. The loan was substantially collateralized by personal property and equity, as guaranteed by the Company. The term loan agreement did not contain financial covenants. In conjunction with the term loan, the Company issued warrants for the purchase of up to 46,636 shares of Common Stock at an exercise price of $0.45 per share. The warrants were recorded as a discount to the term note. Refer to Note 8 for information regarding redeemable warrants.

On February 19, 2020, the Company extinguished the 2018 SVB loan by repaying the outstanding interest and principal balance. The Company also expensed the remainder of the deferred financing fees associated with the loan.

2020 MFS Loan

On November 4, 2020, the Company entered into a secured loan agreement with Manufacturers Financing Services (“MFS”) for $0.4 million to finance the purchase of printing equipment. The loan required a 10% down payment at the time of origination, with 60 monthly payments of $7 thousand inclusive of principal and interest to be paid through December 1, 2025. The imputed interest rate for the periods ended December 31, 2021 and 2020 was approximately 3.4% and 4.1%, respectively. The loan agreement does not contain any financial covenants. The loan is substantially secured by the equipment serving as collateral. The outstanding balance of the loan was $315 thousand as of December 31, 2021.

2020 SVB Loan

On December 29, 2020, the Company entered into a term loan credit agreement with SVB with a maximum credit extension of $6.5 million (“2020 SVB loan”). On March 12, 2021, the agreement was amended to increase the

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Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

maximum credit extension to $10.0 million. The credit agreement defines two tranches of “availability” for advances. The first tranche must be drawn by May 31, 2021 and the second tranche must be drawn by September 30, 2021. The agreement requires monthly interest payments of 4.9% on the outstanding principal and monthly principal payments of $277.8 thousand beginning January 1, 2022. The term of the loan is the earlier to occur of the 36th month after the last tranche of funding and no later than December 1, 2024. The interest rate on the term loan is the greater of (a) the prime rate + 1.0%, or (b) 2.25%.

In connection with acquiring the financing from the 2020 SVB loan, the Company issued warrants for the purchase of 26,115 shares of Common Stock at an exercise price of $1.81 per share. On March 12, 2021, the Company issued 26,115 additional warrants for the purchase of common shares at an exercise price of $13.49 per share. On May 25, 2021, the Company issued 26,115 additional warrants for the purchase of common shares at an exercise price of $13.49 per share. The warrants were determined to be liability classified and were recorded at their issuance date fair value as a discount to the loan. See Note 8 for further discussion on redeemable warrants.

On May 25, 2021, the Company drew the full availability of the loan. The outstanding balance of the loan as of December 31, 2021 was $10.0 million.

2021 SVB Loan

On September 10, 2021, the Company entered into a term loan credit agreement with SVB with a maximum credit extension of $20.0 million. The first $10.0 million of the loan can be drawn upon immediately, and the remaining $10.0 million can only be drawn upon to the amount of other additional financing that the Company receives. The company will make interest-only payments until the term loan’s maturity date, which is the earlier of a merger with a special purpose acquisition company (“SPAC”) or March 10, 2022. The interest rate on the term loan is the prime rate + 6.0%.

On September 10, 2021, the Company drew the initial $10.0 million and an additional $3.0 million when the Drive Capital convertible debt was issued. The Company subsequently drew the remaining $7.0 million on October 26, 2021 when the ECP convertible debt was issued. As of November 8, 2021, the full $20 million has been drawn on the loan. On February 4, 2022, the 2021 SVB Loan was amended to extend the maturity date from March 10, 2022 to April 3, 2023. Refer to Note 15 for further information regarding the extension.

Manufacturers Capital Promissory Notes

On January 15, 2021, the Company entered into a note agreement with Manufacturers Capital to finance the purchase of machinery and equipment. The Company received proceeds of $299 thousand which required down payment of 10% at the time of origination. The agreement calls for 48 monthly payments of $5 thousand, inclusive of principal and interest to be paid through January 15, 2025. The imputed interest rate for the year ended December 31, 2021 was 2.8%. The loan agreement does not contain any financial covenants and is substantially secured by the equipment serving as collateral. The outstanding balance of the loan was $168 thousand as of December 31, 2021.

On March 24, 2021, the Company entered into a note agreement with Manufacturers Capital to finance the purchase of equipment. The Company received proceeds of $680 thousand which required down payment of 10% at the time of origination. The agreement calls for 48 monthly payments of $11.7 thousand, inclusive of principal and interest to be paid through March 24, 2025. The imputed interest rate for the year ended December 31, 2021 was 3.0%. The loan agreement does not contain any financial covenants and is substantially secured by the equipment serving as collateral. The outstanding balance of the loan was $389 thousand as of December 31, 2021.

On July 13, 2021, the Company entered into a note agreement with Manufacturers Capital to finance the purchase of equipment. The Company received proceeds of $253 thousand which required down payment of 10% at the time of origination. The agreement calls for 48 monthly payments of $5.7 thousand, inclusive of principal and interest to be paid through July 13, 2025. The imputed interest rate for the year ended December 31, 2021 was 2.4%. The loan agreement does not contain any financial covenants and is substantially secured by the equipment serving as collateral. The outstanding balance of the loan was $203 thousand as of December 31, 2021.

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On August 16, 2021, the Company entered into a note agreement with Manufacturers Capital to finance the purchase of equipment. The Company received proceeds of $253 thousand which required down payment of 10% at the time of origination. The agreement calls for 48 monthly payments of $5.7 thousand, inclusive of principal and interest to be paid through August 16, 2025. The imputed interest rate for the year ended December 31, 2021 was 2.0%. The loan agreement does not contain any financial covenants and is substantially secured by the equipment serving as collateral. The outstanding balance of the loan was $207 thousand as of December 31, 2021.

Related Party Convertible Notes – Energize Ventures Fund

On March 12, 2021, the Company entered into a note purchase agreement with Energize Ventures Fund LP, Energize Growth Fund I LP, EV FR SPV and Ironspring Venture Fund I-FR, LP, all of which are existing shareholders or affiliates of existing shareholders, for convertible promissory notes (collectively the “Related Party Convertible Notes I”). The Company received the principal of $7.6 million on April 13, 2021 at closing. The Related Party Convertible Notes have a stated interest rate of 6%, with all accrued interest and principal due at maturity, which is April 13, 2023. The Related Party Convertible Notes I are recorded at carrying value. Further, warrants to purchase a maximum of 140,000 shares with an exercise price of $0.01 were issued in conjunction with the closing of the Related Party Convertible Notes I. The warrants were determined to be equity classified and are recorded as a discount to the Related Party Convertible Notes I. For further details, please refer to Note 8. The Related Party Convertible Notes I contain a share settlement redemption feature that qualifies as a derivative liability and requires bifurcation. The derivative had a fair value of $2.5 million as of December 31, 2021 and was recorded in Related party convertible notes and derivative liability on the consolidated balance sheet. For the year ended December 31, 2021, the Company recognized a mark to market loss associated with the derivative of $75 thousand.

The following provides a summary of the interest expense of the Company’s Related Party Convertible Notes I and Related Party Derivative Liability with Energize Ventures:

	Year ended December 31,
(in thousands)	2021
Contractual interest expense	$	327
Amortization of deferred financing costs and convertible debt discount		1,102
Total Interest Expense	$	1,429
Effective interest rate		58.3	%

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Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The following provides a summary of the convertible notes and derivatives:

	As of
(in thousands)	December 31, 2021
Unamortized deferred issuance costs, derivative, and warrants	$	3,534
Net carrying amount of convertible note		4,066
Principal value of convertible note	$	7,600
Fair value of convertible note and derivative liability		9,936
Fair value of convertible note excluding the derivative liability	$	7,446
Fair value level		Level 3

For further information on fair value measurements, refer to Note 10.

Related Party Convertible Notes – Drive Capital Fund

On August 23, 2021, the Company entered into a Note Purchase Agreement with Drive Capital Fund II LP and Drive Capital Ignition Fund II LP (existing stockholders) for convertible promissory notes (collectively the “Related Party Convertible Notes II”). The Company received funding of $3.0 million on August 24, 2021 at closing. The Notes have a stated interest rate of 6%, with all accrued interest and principal due at maturity, which is August 23, 2023. These Related Party Convertible Notes II contain a share settlement redemption feature that qualifies as a derivative liability and requires bifurcation. The derivative had a fair value of $0.6 million as of December 31, 2021 and was recorded in Related party convertible notes and derivative liability on the consolidated balance sheet. For the year ended December 31, 2021, the Company recognized a mark to market loss associated with the derivative of $11 thousand.

The following provides a summary of interest expense on the Company’s Related Party Convertible Notes II and Related Party Derivative Liability with Drive Capital:

	Year ended December 31,
(in thousands)	2021
Contractual interest expense	$	63
Amortization of deferred financing costs and convertible debt discount		86
Total Interest Expense	$	149
Effective interest rate		17.1	%

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Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The following provides a summary of the convertible notes and derivatives:

	As of
(in thousands)	December 31, 2021
Unamortized deferred issuance costs, derivative, and warrants	$	474
Net carrying amount of convertible note		2,526
Principal value of convertible note	$	3,000
Fair value of convertible note and derivative liability		3,390
Fair value of convertible note excluding the derivative liability	$	2,830
Fair value level		Level 3

Related Party Convertible Notes – Energy Capital Partners Holdings

On October 26, 2021, the Company entered into a Note Purchase Agreement with Energy Capital Partners Holdings, LP for convertible promissory notes (collectively the “Related Party Convertible Notes III”). The Company received funding of $7.0 million on October 26, 2021 at closing. The Notes have a stated interest rate of 6%, with all accrued interest and principal due at maturity, which is October 26, 2023. These Related Party Convertible Notes III contain a share settlement redemption feature that qualifies as a derivative liability and requires bifurcation. The derivative had a value of $1.3 million as of December 31, 2021 and was recorded in Related party convertible notes and derivative liability on the consolidated balance sheet. For the year ended December 31, 2021, the Company recognized a mark to market loss associated with the derivative of $122 thousand.

The following provides a summary of the interest expense of the Company’s Related Party Convertible Notes III and Related Party Derivative Liability with Energy Capital Partners Holdings:

	Year ended December 31,
(in thousands)	2021
Contractual interest expense	$	76
Amortization of deferred financing costs and convertible debt discount		95
Total Interest Expense	$	171
Effective interest rate		16.3	%

24

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The following provides a summary of the convertible notes and derivatives:

(in thousands)	As of December 31, 2021
Unamortized deferred issuance costs, derivative, and warrants	$	1,130
Net carrying amount of convertible note		5,870
Principal value of convertible note	$	7,000
Fair value of convertible note and derivative liability		7,829
Fair value of convertible note excluding the derivative liability	$	6,484
Fair value level		Level 3

The Related Party Convertible Notes I, II, and III are convertible into common shares at the option of the holder within 90 days of maturity or are automatically converted upon closing of a SPAC Transaction. Upon a Qualified Financing event, the Related Party Convertible Notes I, II, and III are convertible into preferred equity (as such terms are defined in the Note Purchase Agreement). As of December 31, 2021, the conversion price of the notes was equal to 80% of the lowest price per share paid by the other purchasers of equity sold in any of those certain triggering events. The Related Party Convertible Notes I, II, and III were converted into common shares as part of the Business Combination. Refer to Note 15 for further information.

NOTE 6 – INCOME TAXES

The components of the Company’s loss before income taxes are as follows:

	Years Ended December 31,
	2021			2020
United States	$	(67,883,898	)	$	(21,671,394	)
Foreign		—			—
Total	$	(67,883,898	)	$	(21,671,394	)

The Company did not record any current or deferred federal, state or foreign income taxes for the years ended December 31, 2021 and 2020, respectively.

The reconciliation of the Federal statutory income tax provision to the Company’s effective income tax provision is as follows:

	Years Ended December 31,
	2021			2020
Federal statutory income tax rate		21	%		21	%
Federal income tax at statutory rates	$	(14,255,619	)	$	(4,550,993	)
Valuation Allowance		13,982,549			4,435,667
Other, permanent difference		273,070			115,326
Total income tax provision	$	—		$	—
Effective income tax rate		0	%		0	%

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Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Deferred income taxes reflect the net tax effects of loss and credit carry forwards and temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The Company’s deferred income tax assets and liabilities at December 31, 2021 and 2020 were comprised of the following:

	Years Ended December 31,
	2021			2020
Deferred Tax Assets:
Allowance for doubtful accounts	$	273,692		$	110,381
Accruals and reserves		4,448,488			733,051
Disallowed interest carryforwards		1,332,346			—
Net operating loss and other carryforwards		24,171,779			12,418,254
Stock based compensation		505,580			377,514
Other, net		40,507			16,364
Deferred tax assets before valuation allowance	$	30,772,392		$	13,655,564
Valuation Allowance		(30,739,829	)		(13,591,637	)
Total Deferred Tax Assets, net of valuation allowance		32,563			63,927
Deferred Tax Liabilities:
Depreciation		32,563			63,927
Total Deferred Tax Liabilities		32,563		$	63,927
Net Deferred Tax Assets (Liabilities)	$	—		$	—

A valuation allowance is required to be established when it is more likely than not that all or a portion of a deferred tax asset will not be realized. Realization of deferred tax assets is dependent upon future earnings, the timing and amount of which are uncertain. A full review of all positive and negative evidence needs to be considered, including the Company’s current and past performance, the market environments in which the Company operates, the utilization of past tax credits, length of carry back and carry forward periods, as well as tax planning strategies that might be implemented. Management believes that, based on a number of factors, it is more likely than not, that all of the deferred tax assets may not be realized; and accordingly, as of December 31, 2021 and 2020, the Company has provided a full valuation allowance against its net deferred tax assets.

On a gross basis, the Company has Federal net operating loss carry forwards of $89.8 million and $43.9 million as of December 31, 2021 and December 31, 2020, respectively, of which $1.0 million will expire in 2027 and the remainder of which may be carried forward indefinitely. The Company also has State gross net operating loss carry forwards of $79.3 million and $50.1 million as of December 31, 2021 and December 31, 2020, respectively, in various state jurisdictions which begin to expire in 2030. A full valuation allowance has been established for these net operating loss carry forwards as of December 31, 2021 and December 31, 2020. The increase in the valuation allowance in 2021 was due to an increase in the Federal valuation allowance of $14.0 million and an increase to State valuation allowances of $3.2 million. The following is a rollforward of the Company’s valuation allowances for the years ended December 31, 2021 and 2020, respectively:

Valuation allowance as of January 1, 2020	$	7,831,390
Adjustments to the valuation allowance		5,760,247
Valuation allowances as of December 31, 2020		13,591,637
Adjustments to the valuation allowance		17,148,192
Valuation allowance as of December 31, 2021	$	30,739,829

26

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The Company has no unrecognized tax benefits as of December 31, 2021 and December 31, 2020. The Company is subject to U.S. Federal income tax and various state income taxes. The Company is subject to examination in these jurisdictions for the 2017 year and beyond.

NOTE 7 – TEMPORARY EQUITY AND STOCKHOLDERS’ DEFICIT

Common Equity

The Board of Directors has authorized up to 31,000,000 shares of Common Stock at a $.0001 par value. As of December 31, 2021 and 2020, 4,039,535 and 3,427,555 shares of Common Stock were outstanding, respectively. The holders of record of Common Stock are entitled to elect one member to the Board of Directors.

On April 14, 2018, the Company repurchased 650,000 shares for $0.2 million. The Company had total treasury shares of 650,000 as of December 31, 2021 and 2020, respectively. The Company has not retired any treasury shares as of December 31, 2021.

Preferred Equity

All preferred equity is convertible at the option of the holder and automatically upon contingent events. All preferred equity participates in dividends with Common Stock on an as-converted basis when declared by the Board of Directors.

Series Seed Preferred Shares

The Board of Directors has authorized up to 400,000 Series Seed shares. As of December 31, 2021 and 2020, there were 400,000 Series Seed Preferred Shares issued and outstanding, at the original issuance price of $4.00/share. The Series Seed Preferred shares were entitled to receive a 6% cumulative dividend on the original issue price of the Series Seed Preferred Shares until the first issuance of Series A-1 Preferred Shares. The Series Seed Preferred Shares accrued $0.3 million of cumulative but unpaid dividends prior to the Series A-1 Preferred Share original issuance, for a total liquidation preference of $1.9 million as of December 31, 2021 and 2020. Per the terms of the Second Amended and Restated Certificate of Incorporation of Fast Radius, Inc., dated March 21, 2019, scenarios exist in which accrued but unpaid dividends would not be paid.

Series Seed-1 Preferred Shares

The Board of Directors has authorized up to 515,779 Series Seed-1 Preferred Shares. As of December 31, 2021 and 2020, there were 515,779 Series Seed-1 Preferred Shares issued and outstanding, at the original issuance price of $5.3911/share. The Series Seed-1 Preferred Shares were entitled to receive a 6% cumulative dividend on the original issue price of the Series Seed-1 Preferred Shares until the first issuance of Series A-1 Preferred Shares. The Series Seed-1 Preferred Shares accrued $0.2 million of cumulative but unpaid dividends prior to the Series A-1 Preferred Share original issuance, for a total liquidation preference of $2.9 million as of December 31, 2021 and 2020. Per the terms of the Second Amended and Restated Certificate of Incorporation of Fast Radius, Inc., dated March 21, 2019, scenarios exist in which accrued but unpaid dividends would not be paid.

27

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Series A Preferred Shares

The Board of Directors has authorized up to 5,706,349, 2,574,478, and 2,713,324 Series A-1, Series A-2, and Series A-3 preferred shares, respectively. The Preferred Shares are carried at their original issuance price of $1.00139, $1.20078, and $1.63479 for Series A-1, Series A-2, and Series A-3, respectively. As of December 31, 2021 and 2020, there are 5,706,349 Series A-1, 2,574,478 Series A-2 and 2,621,569 Series A-3 Preferred Shares issued and outstanding with overall liquidation preferences of $5.7 million, $2.8 million and $4.3 million, respectively. The holders of record of Series A Preferred Stock are entitled to elect one member to the Board of Directors.

Series B Preferred Shares

The Board of Directors has authorized up to 5,131,673 Series B Preferred Shares. As of December 31, 2021 and 2020, there were 4,205,059 Series B Preferred Shares issued and outstanding, respectively, at the original issue price of $13.49 per share for a total liquidation preference of $56.7 million as of December 31, 2021 and 2020. The holders of record of Series B Preferred Shares are entitled to elect one member to the Board of Directors.

Liquidation Preferences

In the event of voluntary or involuntary liquidation or dissolution, the remaining assets available for distribution are distributed in the following order pursuant to their respective liquidation preference amounts: Series B, Series A-1, Series A-2, Series A-3, Series Seed, and Series Seed-1. Remaining assets available for distribution after preferential payments have been made will be distributed to holders of Series B and common shares.

Redemption

The preferred shares are redeemable upon a liquidation event, deemed liquidation event, or pursuant to the redemption options (as defined in the underlying agreements) providing the holders of preferred shares the option to force the Company to redeem their shares after seven years from the Series B original issuance date at the original issuance price plus dividends declared. The redemption feature of each issuance of preferred shares is not solely within the control of the Company; they are each also redeemable at the option of the holder. As such, each issuance of preferred stock is classified in temporary equity as redeemable preferred stock and measured at redemption value. The preferred stock is not currently redeemable, but it is probable that the preferred stock will become redeemable in the future and therefore the Company has elected an accounting policy to subsequently measure the preferred stock at current redemption value. Details of redemption for each issuance of preferred stock is discussed below.

Series B Preferred Stock

Unless prohibited by Delaware law governing distributions to stockholders, shares of Series B Preferred Stock shall be redeemed by the Company at a price equal to the applicable Original Issue Price per share, plus all declared but unpaid dividends, in three (3) annual installments commencing on or after the date that is seven (7) years from the Original Issue Date of the Series B Preferred Stock from the holders of at least a majority of the then outstanding shares of Series B Preferred Stock (voting together as a single class).

Series A Preferred Stock

Unless prohibited by Delaware law governing distributions to stockholders, shares of Series A Preferred Stock shall be redeemed by the Company at a price equal to the applicable Original Issue Price per share, plus all declared but unpaid dividends, in three (3) annual installments commencing on or after the date that is seven (7) years from the Original Issue Date of the Series B Preferred Stock from (i) the holders of at least a majority of the then outstanding shares of Series A Stock (voting together as a single class), and (ii) if and only if the Series B Preferred Stock has not yet submitted a Series B Redemption Request, the holders of at least a majority of the then outstanding shares of Series B Preferred Stock (voting together as a single class).

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Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Series Seed-1 Preferred Stock and Series Seed Preferred Stock

Unless prohibited by Delaware law governing distributions to stockholders, shares of Series Seed-1 Preferred Stock and Series Seed Preferred Stock shall be redeemed by the Company at a price equal to the applicable Original Issue Price per share, plus all declared but unpaid dividends, in three (3) annual installments commencing on or after the date that is seven (7) years from the Original Issue Date of the Series B Preferred Stock from (i) the holders of at least a majority of the then outstanding shares of Series Seed-1 Preferred Stock and Series Seed Preferred Stock (voting together as a single class), and (ii) if and only if (A) the Series B Preferred Stock has not yet submitted a Series B Redemption Request, the holders of at least a majority of the then outstanding shares of Series B Preferred Stock (voting together as a single class) and (B) the Series A Stock has not yet submitted a Series A Redemption Request, the holders of at least a majority of the then outstanding shares of Series A Stock (voting together as a single class).

NOTE 8 – WARRANTS

Warrants issued to purchase Common Stock

On December 29, 2020, in connection with the 2020 SVB Loan, the Company issued warrants for the purchase of 26,115 shares of Common Stock at an exercise price of $1.81 per share. On March 12, 2021, the Company amended the December 29, 2020 warrant agreement such that there would be issuances of warrants upon execution of the amendment and on the draw date of the debt. On the date of the amendment, the Company issued 26,115 warrants at an exercise price of $13.49 per share with an expiration date of March 12, 2033. When the draw occurred on May 25, 2021, the Company issued warrants for the purchase of an additional 26,115 shares of Common Stock to SVB at an exercise price of $13.49 per share with an expiration date of March 12, 2033. As of December 31, 2021, the full amount of the debt has been drawn and 78,345 warrants were issued and outstanding associated with the amended agreement, comprised of 26,115 and 52,230 warrants issued in 2020 and 2021, respectively. The SVB warrants are classified as a derivative liability pursuant to ASC 815-40, Derivatives and Hedging (“ASC 815-40”) and adjusted to their fair value with changes in fair value recognized in earnings. Refer to Note 5 for further information regarding this loan.

On February 2, 2020, for UPS’s role in assisting to lead and secure the Series B Preferred Stock financing round, the Company issued UPS warrants to purchase up to 101,927 shares of the Company’s Common Stock. The exercise price for the warrants issued to UPS is $0.0001 per share. The warrants are classified as equity and were recorded at fair value upon issuance.

On April 13, 2021, the Company issued warrants for the purchase of 140,000 shares of Common Stock to holders of the Related Party Convertible Notes I, as further discussed in Note 5. The warrants have an exercise price of $0.01 per share with an expiration date of April 13, 2031. The warrants are classified as equity and were recorded at fair value upon issuance with a corresponding discount to the Related Party Convertible Notes I.

On September 10, 2021, the Company issued warrants for the purchase of 106,270 shares of Common Stock to SVB at an exercise price of $20.92 per share with an expiration date of September 10, 2033. These warrants were granted in conjunction with a term loan of up to $20.0 million. As of December 31, 2021, $20.0 million of the debt has been drawn. The SVB warrants are classified as equity and were recorded at fair value upon issuance with a corresponding discount to the notes. Refer to Note 5 for further information regarding this loan.

29

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

A summary of the Common Stock warrant activity for the years ended December 31, 2021 and 2020 is as follows:

	Number of warrants		Weighted average exercise price		Weighted average grant date fair value		Weighted average remaining contractual term (years)
Outstanding at January 1, 2020		809,001	$	0.84	$	1.68
Granted		128,042		0.37		2.24
Exercised		—		—		—
Outstanding at December 31, 2020		937,043	$	0.78	$	1.75		4.06
Exercisable		937,043
	Number of warrants		Weighted average exercise price		Weighted average grant date fair value		Weighted average remaining contractual term (years)
Outstanding at January 1, 2021		937,043	$	0.78	$	1.75
Granted		298,500		9.81		18.20
Exercised		—		—		—
Outstanding at December 31, 2021		1,235,543	$	2.96	$	5.73		4.84
Exercisable		1,235,543

As of December 31, 2021 and 2020, there are warrants allowing for the purchase of up to 1,235,543 and 937,043 shares of Common Stock, respectively. Warrants are exercisable at any time, at the option of the holder, into Common Stock at a rate of 1 to 1 initially, subject to adjustments for dilution.

Other than warrants accounted for under ASC 718, the Company evaluated the warrants for liability or equity classification in accordance with the provisions of ASC 480 and ASC 815-40. Based on the provisions governing the warrants in the applicable agreements, the Company determined that the warrants associated with the 2018 SVB loans, 2021 SVB loans, and Related Party Convertible Notes I meet the criteria required to be classified as an equity award. Accordingly, the warrants were recorded at their grant date fair value with no subsequent remeasurement. The 2020 SVB loan warrants associated with the financing agreement have been determined to be liability classified. Accordingly, the warrants were recorded at their initial fair value and are remeasured at fair value at each subsequent reporting date. Additionally, all warrants issued are immediately exercisable and expire on an expiration date specified in each agreement. Warrants issued to XMS Capital Partners, LLC (“XMS”) and UPS are accounted for pursuant to ASC 718, Compensation—Stock Compensation (“ASC 718”). Refer to Note 9 for further information regarding stock-based compensation.

30

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Warrants issued to purchase Series A-3 Preferred Stock

On October 4, 2018, in connection with obtaining a $3.0 million loan from ATEL to finance equipment purchases, the Company issued a warrant to purchase up to 91,755 Series A-3 Preferred shares at a price of $1.63 per share. 32,405 warrants were issued in conjunction with the term loan and have an expiration date that is the earlier of October 4, 2033 or the 5th anniversary of an initial public offering (“IPO”) closing. This warrant to purchase 32,405 shares represents all A-3 warrants outstanding as of December 31, 2021 and 2020, respectively.

The Company evaluated the Series A-3 warrants issued to ATEL for liability or equity classification in accordance with the provisions of ASC 480 and ASC 815-40. Based on the provisions governing the warrants in the applicable agreement, the ATEL Series A-3 warrants have been determined to be liability classified. Accordingly, the warrants were recorded at their initial fair value and are remeasured at fair value at each subsequent reporting date. All Series A-3 warrants issued are immediately exercisable and expire on the expiration date specified in the warrant agreement.

The Company recognized expense of $2.2 million and $83 thousand related to liability classified warrants during the years ended December 31, 2021 and 2020, respectively, which included changes in fair value and interest expense associated with the amortization of discounts allocated to the related debt liabilities. The Company recognized $1.8 million and $0.3 million of expense related to equity classified warrants (under ASC 718) during the years ended December 31, 2021 and 2020, respectively, which included the costs recognized upon issuance and interest expense associated with the amortization of discounts allocated to the related debt liabilities.

The number and kind of securities purchasable upon the exercise of these warrants and their exercise price shall be subject to adjustment from time to time upon the occurrence of certain events which may impact the exercise price and number of shares issued, including (a) stock dividends or splits, etc. (b) reclassification, exchange, combinations or substitution or (c) adjustments to conversion price.

NOTE 9 – STOCK BASED COMPENSATION

Stock Options

On December 4, 2017, the Company’s Board of Directors adopted its 2017 Incentive Plan which subsequently was amended and restated on July 29, 2020 (the “Plan”). The Plan was entered into with the objective of attracting and retaining key personnel, providing for additional performance incentives, and promoting the success of the Company by increasing the efforts of participants. The Plan seeks to achieve this purpose by providing for awards in the form of stock options (“options”) and RSUs to officers, employees, consultants, and directors of the Company. Pursuant to the Plan, the Company has issued the following stock-based payment awards to employees and nonemployees in exchange for services provided to the Company, (i) options to the Company’s founders, including options early exercised through a promissory note, (ii) stock options and RSUs to various employees and former employees, and (iii) options and warrants issued to various nonemployee consultants (collectively, the “Awards”). The underlying Awards pursuant to the Plan are administered by the Compensation and Management Development Committee of the Board of Directors.

12,258,817 shares are reserved and available for grant and issuance pursuant to the Plan as of the date of adoption of the amended Plan.

Stock-based compensation expense during the years ended December 31, 2021 and 2020, was $0.9 million and $1.0 million respectively. No income tax benefit was recognized in the consolidated statements of net loss and comprehensive loss and an immaterial amount of compensation was capitalized during 2021. Stock-based

31

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

compensation expense was recorded in the following financial statement lines within the consolidated statements of net loss and comprehensive loss:

	December 31, 2021		December 31, 2020
Cost of Revenues	$	13,402	$	14,383
General and Administrative	$	680,609	$	825,664
Selling and Marketing	$	79,695	$	104,985
Research & Development	$	81,690	$	47,048

In 2018, founders early exercised approximately 7.7 million stock options through execution of partial-recourse promissory notes. The options had an exercise price of $0.28 per share. The options contain various service and performance-based vesting conditions. Specifically, a portion of the options vest solely based on a graded four- year service condition, a portion vests based on both achievement of a performance condition as well as completion of a graded four-year service condition, and the remaining vest on achieving certain pre-money valuation in a financing event as well as completion of a graded five-year service condition. During the years ended December 31, 2021 and 2020, 505,500 and 2,218,392 of the shares associated with these early exercised options became outstanding for accounting purposes as they were released from the notes’ recourse provision. The release of the notes’ recourse provision was the result of the donation or sale of these early exercised options by the founders, resulting in an increase in Common Stock outstanding.

During fiscal year 2020, the Company issued 1,012,066 stock options to its employees and consultants collectively at exercise prices ranging between $1.63 and $1.81. Stock options granted to employees were subject to graded service-based vesting over the period of four years (primarily), subject, in each case, to the individual’s continued service through the applicable vesting date.

In 2019, the Company issued 58,203 stock options to nonemployees in connection with their respective advisory services to the Company at exercise prices of $1.63. There were no stock options issued to nonemployees during the years ended December 31, 2021 and 2020. Stock options granted to one of the nonemployees are subject to both performance and service-based conditions wherein vesting is contingent upon meeting certain business development goals per year and subject to continued services as senior advisor to the Company. Whereas stock options granted to another nonemployee is subject to a standard four-year time-based vesting schedule with 1/16 of the shares to vest each quarter subject to acceleration upon an initial public offering or a change of control event. With the exception of 341,494 options which had an expiration date of January 11, 2020, all options expire 10 years after the date of grant.

32

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

The following table summarizes activity in relation to the Company’s stock options issued to employees, founders and consultants:

	Number of Shares/Units		Weighted Average Exercise Price		Weighted Average Grant Date Fair Value		Weighted Average Remaining Contractual Life		Aggregate Intrinsic Value
							(years)
Balance at January 1, 2021		3,182,758	$	1.39	$	0.76		8.59	$	8,636,744
Granted		—		—		—				—
Exercised		106,480		0.97		0.54				2,882,631
Forfeited		224,250		1.44		0.78				5,965,765
Expired		25,629		1.68		0.91				675,649
Balance at December 31, 2021		2,826,399	$	1.40	$	0.77		7.60	$	75,296,955
Exercisable at December 31, 2021		1,392,684		1.15		0.62		7.31		37,456,625
Expected to vest at December 31, 2021		1,433,715		1.65		0.84		7.87		37,840,330

As of December 31, 2021, there was approximately $0.9 million of unrecognized compensation cost related to options under the Plan which is expected to be recognized over a weighted average period of 1.1 years.

The Company recognizes compensation expense for the options equal to the fair value of the equity-based compensation awards over the vesting period of such awards. The fair values associated with the options are estimated on the date of grant using the Black-Scholes option-pricing model using the following assumptions:

	2020
Expected annual dividend yield		0.00	%
Expected volatility		51.78	%
Risk-free rate of return		0.75	%
Expected option term (years)		5.98

The Black-Scholes option pricing model requires the input of certain subjective assumptions, including (a) the expected stock price volatility, (b) the calculation of expected term of the award, (c) the risk-free interest rate and (d) expected dividends. Due to the lack of company-specific historical and implied volatility data for trading the Company’s stock in the public market, the Company has based its estimate of expected volatility on the historical volatility of a group of similar companies that are publicly traded. The historical volatility is calculated based on a period of time commensurate with the expected term assumption. The computation of expected volatility is based on the historical volatility of a representative group of companies with similar characteristics to the Company, including stage of product development and digital manufacturing industry focus. The Company is a technology and services platform positioned as a supply chain solution and the representative group of companies has certain similar characteristics to the Company. The Company believes the group selected has sufficient similar economic and industry characteristics and includes companies that are most representative of the Company. The expected term is applied to the stock option grant group as a whole, as the Company does not expect substantially different exercise or post-vesting termination behavior among its employee population. For options granted to nonemployees, the Company

33

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

utilizes the contractual term of the arrangement as the basis for the expected term assumption. The risk-free interest rate is based on a treasury instrument whose term is consistent with the expected life of the options. The expected dividend yield is assumed to be zero as the Company has never paid dividends and has no current plans to pay any dividends on its Common Stock, which is similar to the Company’s peer group.

Restricted Stock Units

As of December 31, 2021 and 2020, the Company has issued 2,205,452 and 235,150, respectively, of RSUs with a weighted average grant date fair value of $16.93 and $1.97 per RSU, respectively. Of the 2,205,452 RSUs issued as of December 31, 2021, 1,219,695 are standard RSUs and 985,757 are founder RSUs.

Standard employee RSUs contain both service and performance conditions wherein vesting is generally subject to a requisite four year service period, whereby the award vests 25% on the one-year anniversary of the Vesting Commencement Date (as defined in the Company’s Stock Purchase Agreement) then ratably over 36 monthly installments, subject to continuous service by the individual and achievement of the performance target, as stipulated in the notice of grant (“Liquidity Event” as defined in the underlying agreements). Due to the nature of the performance condition, recognition of compensation cost has been deferred until the occurrence of a Liquidity Event.

As of December 31, 2021, unrecognized compensation costs associated with outstanding RSUs was approximately $35.8 million.

Founder RSUs include a portion that vests upon the closing of a SPAC transaction or the first IPO to occur following February 1, 2021, and a portion that will vest on the first day following the lapse of the Lock-up Period, the first 180 days from the consummation of a SPAC transaction or IPO, on which the Company Valuation equals or exceeds $1.5 billion. 597,430 of the founders RSUs will vest upon completion of the initial SPAC transaction or IPO and the remaining 388,327 will vest upon the achievement of a $1.5 billion valuation following a SPAC transaction or IPO. Due to the nature of the vesting conditions, recognition of compensation cost has been deferred until the applicable vesting conditions have been met.

34

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

See below for a summary of RSU activity for the year ended December 31, 2021:

	Number of units			Weighted average grant date fair value
Non-vested at January 1, 2021		219,252		$	1.97
Granted		1,970,302			18.72
Vested		—			—
Forfeited		(110,023	)		13.63
Non-vested at December 31, 2021		2,079,531		$	17.22

The stock-based compensation expense associated with RSUs will not be recognized until the completion of a Liquidity Event, at which time RSUs whose service conditions have been met will vest and the associated compensation costs will be recognized as stock-based compensation expense.

As of December 31, 2021, the service conditions for 166,800 of the outstanding 1,093,774 standard employee RSUs have been achieved. The remaining outstanding employee RSUs are expected to achieve their service conditions over a weighted average period of approximately 1.4 years.

Note 10 – Fair Value Measurements

The Company measures the fair value of financial instruments using a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. Each level of input has different levels of subjectivity and difficulty involved in determining fair value.

Level 1 - Inputs used to measure fair value are unadjusted quoted prices that are available in active markets for the identical assets or liabilities as of the reporting date. Therefore, determining fair value for Level 1 investments generally does not require significant judgment, and the estimation is not difficult.

Level 2 - Pricing is provided by third-party sources of market information obtained through investment advisors. The Company does not adjust for or apply any additional assumptions or estimates to the pricing information received from its advisors.

Level 3 - Inputs used to measure fair value are unobservable inputs that are supported by little or no market activity and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management’s estimates of market participant assumptions. The determination of fair value for Level 3 instruments involves the most management judgment and subjectivity.

The Company’s financial assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2021 and 2020 by level within the fair value hierarchy are as follows:

	December 31, 2021
	Quoted prices in active markets		Significant other observable inputs		Significant unobservable inputs
	(Level 1)		(Level 2)		(Level 3)
Cash sweep and money market accounts	$	8,701,895	$		$
Related party derivative liabilities	$	—	$	—	$	4,395,000
Warrant liability	$	—	$	—	$	2,968,435

35

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

	December 31, 2020
	Quoted prices in active markets		Significant other observable inputs		Significant unobservable inputs
	(Level 1)		(Level 2)		(Level 3)
Cash sweep and money market accounts	$	17,562,823	$	—	$	—
Warrant liability	$	—	$	—	$	199,408

There were no transfers between Level 1, 2 or 3 during the periods ended December 31, 2021 and December 31, 2020.

Fair Value of warrants issued to purchase Common Stock

The following table includes a summary of the changes in fair value of the Company’s liability classified warrants issued to purchase Common Stock measured at fair value using significant unobservable inputs (Level 3) for the years ended December 31, 2021 and 2020:

	December 31, 2021		December 31, 2020
Beginning balance	$	86,963	$	—
Additions		987,747		86,963
Change in fair value recorded in earnings		939,454		—
Ending balance	$	2,014,164	$	86,963

A summary of the weighted average significant unobservable inputs (Level 3 inputs) used in measuring the Company’s warrant liability for common share warrants categorized within Level 3 of the fair value hierarchy as of December 31, 2021 and 2020 is as follows:

	December 31, 2021			December 31, 2020
Stock Price	$	28.28		$	4.11
Term (Years)		10.71			12.00
Volatility		84.40	%		120.13	%
Risk-free rate of return		1.52	%		0.13	%
Dividend Yield		0.00	%		0.00	%

Fair Value of warrants issued to purchase series A-3 preferred stock

The following table includes a summary of changes in fair value of the Company’s liability classified warrants issued to purchase series A-3 preferred stock measured at fair value using significant unobservable inputs (Level 3) for the years ended December 31, 2021 and 2020:

	December 31, 2021		December 31, 2020
Beginning balance	$	112,445	$	32,405
Additions		—		—
Change in fair value recorded in earnings		841,826		80,040
Ending balance	$	954,271	$	112,445

36

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

A summary of the weighted average significant unobservable inputs (Level 3 inputs) used in measuring the Company’s warrant liability for A-3 preferred share warrants is categorized within Level 3 of the fair value hierarchy as of December 31, 2021 and 2020 are as follows:

	December 31, 2021			December 31, 2020
Stock/ Price	$	30.19		$	4.23
Term (Years)		11.26			12.50
Volatility		83.10	%		118.63	%
Risk-free rate of return		1.54	%		0.13	%
Dividend Yield		0.00	%		0.00	%

Related Party Derivative Liability

The following table includes a summary of changes in fair value of the Company’s Related party derivative liabilities related to the convertible notes measured at fair value using significant unobservable inputs (Level 3) for the year ended December 31, 2021:

	December 31, 2021
Beginning balance	$	—
Additions		4,187,000
Change in fair value recorded in earnings		208,000
Ending balance	$	4,395,000

A summary of the weighted average significant unobservable inputs (Level 3 inputs) used in measuring the Company’s derivative liability categorized within Level 3 of the fair value hierarchy as of December 31, 2021 and their inception dates are as follows:

Energize Ventures	December 31, 2021			April 13, 2021 (Inception)
Cost of debt		11.0	%		11.0	%
Term (Years)		0.08 – 0.25			0.25 – 0.50
Present value factor		0.98 – 0.99			0.95 – 0.97
Drive Capital	December 31, 2021			August 24, 2021 (Inception)
Cost of debt		11.0	%		11.0	%
Term (Years)		0.08 – 0.25			0.31 – 0.60
Present value factor		0.98 – 0.99			0.94 – 0.97
ECP Holdings	December 31, 2021			October 26, 2021 (Inception)
Cost of debt		11.0	%		10.0	%
Term (Years)		0.08 – 0.25			0.27 – 0.43
Present value factor		0.98 – 0.99			0.96 – 0.98

37

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 11 – COMMITMENTS AND CONTINGENCIES

The Company accounts for loss contingencies in accordance with ASC 450-20, Loss Contingencies. Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated.

Commitments

In May 2021, the Company entered into a master subscription agreement with Palantir Technologies Inc. (“Palantir”) in which the Company would commit to utilize software and services from Palantir over the next six years for a total of $45.0 million. The software and services are an integral part of the Company’s plan to provide automated intelligence solutions as a service upon commercialization of the Company’s Cloud Manufacturing Platform. The agreement is structured such that the Company committed to spend $50.0 thousand per month through the earlier of the closing of the Merger or December 31, 2021. Should the Merger not have been consummated, the Company had the option of terminating the agreement and no further commitments would have been required. Upon close of the Merger in February 2022, the Company made a payment to Palantir of $9.4 million and the remaining non-cancellable future minimum payments due on this firm purchase agreement are $10.1 million.

Contingencies

In October 2021, based on an internal review, the Company became aware of certain additional duties likely owed to the United States Customs and Border Protection (“CBP”). The Company initiated a voluntary prior disclosure to CBP in late 2021 of certain possible errors in the declaration of imported products relating to value, classification, and other matters. The Company’s comprehensive review of import practices and communication with CBP is ongoing to accurately complete the analysis and quantify the liability. As a result, related to additional duties primarily from 2021, the Company recognized a $1.0 million charge within Cost of revenues in the consolidated statement of net loss and comprehensive loss for the year ended December 31, 2021. The Company made a further submission to CBP in March 2022 providing details regarding the possible errors and is working diligently to resolve the matter. The resolution of this prior disclosure could be material to the Company’s cash flows in a future period and to its results of operations for any period.

Operating Leases

The Company leases certain equipment (3D printers), office space and its corporate headquarters under non-cancelable lease agreements with remaining terms that do not extend past 2026 which are accounted for as operating leases. Rent expense is recorded on a straight-line basis over the lease term. Certain of the operating lease agreements contain rent escalation provisions. The difference between cash rent payments and the recognition of straight-line rent expense is recorded as deferred rent. Rent expense for the years ended December 31, 2021 and 2020 was $3.1 million and $1.7 million, respectively.

Future minimum non-cancelable lease payments under the Company’s operating leases as of December 31, 2021 were as follows:

	Amounts
2022		2,895,231
2023		2,191,339
2024		779,456
2025		803,073
2026		67,087
Total	$	6,736,187

NOTE 12 – EMPLOYEE BENEFIT PLAN

The Company sponsors a defined contribution plan for its employees in the United States. This plan is qualified under Section 401(k) of the U.S. tax code. Currently, the Company does not match any employee contributions and no expense was recorded in the consolidated statements of net loss and comprehensive loss for the years ended December 31, 2021 and 2020, respectively.

38

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

NOTE 13 – RELATED PARTY TRANSACTIONS

United Parcel Service

Since the Company’s inception, UPS has contributed significant amounts of capital in the form of equity and debt to the Company. UPS currently has investments in Series Seed and Series Seed-1, Series A-2 and Series B Preferred Shares, with balances of $0.6 million, $1.8 million, $1.0 million and $35.0 million as of December 31, 2021 and 2020, respectively. The Company has multiple agreements with UPS, which are summarized below.

The Company entered into a Discount Agreement in 2016 with UPS, which was amended in March 2017 and March 2019. Under the agreement, UPS performs advertising and brand marketing services for the Company. In exchange for the services, the Company has agreed to compensate UPS in the form of equity royalties which are determined based on 6% of the Company’s gross revenues. The Company determined this arrangement qualifies as a nonmonetary transaction within ASC 718. In 2019, the Company issued 14,924 shares of Series B Preferred Stock for these services. As of December 31, 2021 and 2020, the Company recognized $2.5 million and $1.3 million as a related party accrued liability on the consolidated balance sheets. During the years ended December 31, 2021 and 2020, the Company recognized $1.2 million and $0.8 million, respectively, in sales and marketing expense on its consolidated statements of net loss and comprehensive loss.

The Company entered into a warehouse rental agreement with UPS in January 2015. The Company leases space in a warehouse in Louisville, KY that is used for printing equipment, supplies, packages and shipping space. The Company paid $66.7 thousand and $65.7 thousand in lease payments to UPS for the years ended December 31, 2021 and 2020, respectively.

The Company entered into a shipping service agreement with UPS in 2016 (as amended in both 2017 and 2019) for which the Company receives pickup and delivery services. The Company paid $1.0 and $0.5 million in fees to UPS for shipping services for the years ended December 31, 2021 and 2020, respectively.

The Company entered into a sub-lease agreement with UPS in August 2018. The Company sub-leases office space from UPS in Singapore. The Company paid $7.3 thousand and $6.7 thousand in lease payments to UPS for the years ended December 31, 2021 and 2020, respectively.

Energize Venture Fund & Ironspring Venture Fund

On February 3, 2020, Energize Venture Fund LP (“Energize”) purchased 1,371,428 and 444,773 shares of common stock and Series B Preferred Stock, with a balance of $4.8 million and $6.0 million, as of December 31, 2021 and 2020, respectively.

On February 3, 2020, Ironspring Venture Fund I, LP (“Ironspring”) purchased 148,256 shares of Series B Preferred Stock, with a balance of $2 million as of December 31, 2021 and 2020, respectively.

On March 12, 2021, the Company signed a convertible note agreement with Energize and Ironspring, which was funded on April 13, 2021. The Company received $7.6 million in proceeds related to these notes. The notes have a stated interest rate of 6% and an effective interest rate of 58%, with all principal and interest due at maturity. As of December 31, 2021, the Company recognized $1.4 million in interest expense related to these notes and has recorded a derivative liability with a fair market value of $2.5 million as of December 31, 2021. Please refer to Note 5 for further details.

The Company also issued warrants to purchase 140,000 shares of Common Stock to holders of Energize, as further discussed in Note 8.

Drive Capital

On November 13, 2017, Drive Capital purchased 3,994,445 shares of Series A - 1 Preferred Stock for $4.0 million. Drive Capital made additional purchases of 1,835,099 shares of Series A - 3 Preferred Stock on June 12, 2018 and of 741,289 shares of Series B Preferred Stock on March 21, 2019 for $3.0 million and $10.0 million, respectively. All shares purchased by Drive Capital remain outstanding as of December 31, 2021 and 2020, respectively.

39

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

On August 24, 2021, the Company signed a convertible note agreement with Drive Capital, which was funded on August 24, 2021. The Company received $3.0 million in proceeds related to these notes. The notes have a stated interest rate of 6% and an effective interest rate of 17%, with all principal and interest due at maturity. As of December 31, 2021, the Company recognized $0.1 million in interest expense related to these notes and has recorded a derivative liability with a fair market value of $0.6 million as of December 31, 2021. Please refer to Note 5 for further details.

ECP Holdings

On October 26, 2021, the Company signed a convertible note agreement with Energy Capital Partners Holdings LP (“ECP Holdings”), an affiliate of ENNV, which was funded on October 26, 2021. The Company received $7.0 million in proceeds related to these notes. The notes have a stated interest rate of 6% and an effective interest rate of 16%, with all principal and interest due at maturity. As of December 31, 2021, the Company recognized $0.2 million in interest expense related to these notes and has recorded a derivative liability with a fair market value of $1.3 million as of December 31, 2021. Please refer to Note 5 for further details.

Palantir

Concurrently with the execution of the Merger Agreement, ENNV entered into subscription agreements with certain third-party investors, including, among others, UPS, Palantir and ENNV (the “PIPE Investors”), pursuant to which the PIPE Investors agreed to subscribe for and purchase, and ENNV agreed to issue and sell, to the PIPE Investors an aggregate of 7,500,000 shares of Common Stock (the “PIPE Shares”) for a purchase price of $10.00 per share, or an aggregate purchase price of $75.0 million, in a private placement (the “PIPE Investment”). The Pipe Investment closed concurrently with the Business Combination on February 4, 2022. In May 2021, the Company entered into a master subscription agreement with Palantir in which the Company would commit to utilize software and services from Palantir over the next six years for a total of $45.0 million. The software and services are an integral part of the Company’s plan to provide automated intelligence solutions as a service upon commercialization of the Company’s Cloud Manufacturing Platform. The agreement is structured such that the Company committed to spend $50 thousand per month through the earlier of the closing of the Merger or December 31, 2021. Should the Merger not have been consummated, the Company had the option of terminating the agreement and no further commitments would have been required. Upon close of the Merger in February 2022, the Company made a payment to Palantir of $9.4 million and the remaining non-cancellable future minimum payments due on this firm purchase agreement are $10.1 million.

NOTE 14 – NET LOSS PER SHARE

The Company computes basic loss per share using net loss attributable to Common Stockholders and the weighted-average number of Common Stock shares outstanding during each period. Diluted earnings per share include shares issuable upon exercise of outstanding stock options and stock-based awards where the conversion of such instruments would be dilutive. The Company’s potentially dilutive securities, which include stock options, unvested restricted stock awards/units, convertible notes, redeemable convertible preferred stock and warrants to purchase shares of redeemable convertible preferred stock, have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share. Therefore, the weighted average number of common shares outstanding used to calculate both basic and diluted net loss per share attributable to the Company’s stockholders’ is the same.

40

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Presented in the table below is a reconciliation of the numerator and denominator for the basic and diluted earnings calculations for the years ended December 31, 2021 and 2020 is as follows:

	December 31, 2021			December 31, 2020
Income (loss) available to Common Stockholders per share:
Net loss	$	(67,883,898	)	$	(21,671,394	)
Weighted average common shares outstanding:
Basic and Diluted		4,139,275			2,950,556
Net loss per share – Basic and Diluted	$	(16.40	)	$	(7.34	)

The computation of diluted net loss per share excluded 23,081,483 and 17,205,650 shares in 2021 and 2020, respectively, because their inclusion would have had an anti-dilutive effect on net loss per share

NOTE 15 – SUBSEQUENT EVENTS

In connection with the preparation of the consolidated annual financial statements for the year ended December 31, 2021, management has evaluated events through March 30, 2022 which is the date the financial statements were issued, to determine whether any events required recognition or disclosure in the consolidated financial statements. The following subsequent events were identified through the date of these consolidated financial statements:

On February 4, 2022, Fast Radius consummated the Business Combination. The aggregate merger consideration issued by ENNV (such company, following the Business Combination, the “Combined Company”) was $750.0 million. In connection with the Closing:

• Each issued and outstanding share of Fast Radius capital stock was converted into and exchanged for 65,000,000 shares of the Combined Company’s Common Stock.

• Outstanding principal on the mandatorily redeemable Fast Radius convertible notes were converted into 989,539 shares of Fast Radius Common Stock (2,034,513 shares of the Combined Company’s Common Stock).

• 1,267,948 warrants were exercised and converted into 1,089,378 shares of the Combined Company’s Common Stock.

• 803,227 RSUs and 25,306 options vested upon the closing of the Business Combination. Compensation expense associated with these awards will be recognized in the first quarter of 2022.

• $3.6 million in transaction bonuses to certain founders and employees of the Company upon consummation of the Business Combination became due.

Upon the completion of the Business Combination, Lou Rassey, Chief Executive Officer, was granted a restricted stock unit award (“Closing RSU Award”) under the Plan. The Closing RSU Award will be in respect to the number of shares of Combined Company Common Stock equal to 5% of the sum of: (i) the total number of shares of Combined Company Common Stock as determined on a fully diluted basis as of the Closing, plus (ii) total number of Earn Out Shares. The Closing RSU Award is eligible to vest in installments contingent upon Mr. Rassey’s continued employment as Chief Executive Officer through the date of attainment of each of the Combined Company common stock share price performance goals. The aggregate estimated grant date fair value of the closing RSU award will be determined using a Monte Carlo Simulation model during the first quarter of 2022.

On February 4, 2022, the 2021 SVB Loan was amended to extend the maturity date from the Closing to April 3, 2023 and required payment of $2.0 million of the $20.0 million outstanding principal balance upon consummation of the Business Combination. This amendment also added the original $0.8 million fee due at the SPAC closing to the amended loan’s outstanding principal balance, deferring its repayment until maturity. In exchange for the extension of the loan, Fast Radius will pay an additional fee of $2.1 million due at maturity. The Company will make six interest-only payments beginning March 1, 2022 and will begin paying $2.4 million in principal beginning September 1, 2022. The interest rate on the term loan is the prime rate + 6.0%.

41

Fast Radius Operations, Inc.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

In conjunction with the close of the Business Combination, the Company paid approximately $9.4 million to Palantir related to services provided under the agreement as of the Closing. Please refer to Note 11 for further details.

The Company is not aware of any additional subsequent events, other than those described above, that would require recognition or disclosure in the consolidated financial statements.

Note 16 – RESTATEMENT OF FINANCIAL RESULTS AS OF AND FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2021 (UNAUDITED)

The Company has restated its financial statements as of and for the nine-month period ended September 30, 2021 in this Current Report on Form 8-K. The restatement resulted from the following items identified while preparing the consolidated financial statements as of and for the three and twelve months ended December 31, 2021:

• The Company identified that it recorded revenue in the third quarter of 2021 prior to the criteria for revenue recognition under U.S. generally accepted accounting principles being satisfied. Specifically, certain transactions were recorded as revenue for which the Company could not assert that collection from the customer was probable under the requirements of Accounting Standard Codification (“ASC”) 606. Accordingly, for the subject revenue transactions, revenue and accounts receivable balances were reduced by $2.1 million in the period that the sale was originally recorded as revenue and will be deferred to a future date until the requirements for revenue recognition under ASC 606 have been satisfied. As a result of the adjustment to revenue, the Company also adjusted its sales and marketing expense by $132 thousand related to its agreement with UPS that requires the Company to compensate UPS for services performed based on a percentage of the Company’s revenues.

• The Company identified that it had capitalized certain costs related to the development of internal-use software that were not eligible for capitalization during the nine-month period ended September 30, 2021. Accordingly, property and equipment, net has been reduced by $1.7 million with an offsetting increase to research and development expense. Related amortization expense of assets that were already placed into service was also reduced by $63 thousand.

• The Company identified that it over accrued certain expenses related to the Business Combination as of September 30, 2021. Accordingly, accrued and other liabilities was reduced by $1.1 million with an offsetting decrease to general and administrative expense.

• The Company identified that it classified certain cash payments related to direct and incremental equity issuance-related transaction costs within operating cash flows rather than financing cash flows on the condensed consolidated statement of cash flows for the nine months ended September 30, 2021. Accordingly, operating cash flows increased and financing cash flows decreased by $500 thousand.

The following summarizes the effect of the restatement on each financial statement line item for the period presented:

42

Fast Radius Operations, Inc.

CONDENSED CONSOLIDATED BALANCE SHEET

As of September 30, 2021	As previously reported			Restatement impact			As Restated
Assets
Current assets
Cash and cash equivalents	$	11,453,360		$			$	11,453,360
Accounts receivable, net of allowances for doubtful accounts of $610,001		8,208,471			(2,062,892	)		6,145,579
Inventories		550,174						550,174
Prepaid production costs		1,325,861						1,325,861
Prepaid expenses and other current assets		3,296,696						3,296,696
Total current assets	$	24,834,562		$	(2,062,892	)	$	22,771,670
Non-current assets
Property and equipment, net		9,487,287			(1,642,828	)		7,844,459
Other non-current assets		357,953						357,953
Total assets	$	34,679,802		$	(3,705,720	)	$	30,974,082
Liabilities, temporary equity and stockholders’ deficit
Current liabilities
Accounts payable	$	2,213,089		$			$	2,213,089
Accrued compensation		1,462,200						1,462,200
Accrued and other liabilities		9,753,335			(1,238,380	)		8,514,955
Advances from customers		215,399						215,399
Accrued liabilities – related parties		2,242,776						2,242,776
Warrant liability		2,713,024						2,713,024
Current portion of long-term debt		13,590,029						13,590,029
Total current liabilities	$	32,189,852		$	(1,238,380	)	$	30,951,472
Other long-term liabilities		230,630						230,630
Term loans - net of current portion and debt issuance costs		7,940,386						7,940,386
Related party convertible notes and derivative liabilities		9,244,326						9,244,326
Total liabilities	$	49,605,194		$	(1,238,380	)	$	48,366,814
Commitments and contingencies (Note 11)								—
Temporary equity
Series Seed Preferred stock; par value $0.0001, 400,000 shares authorized; 400,000 shares issued and outstanding as of September 30, 2021, aggregate liquidation preference of $1,892,812 as of September 30, 2021	$	1,892,812					$	1,892,812
Series Seed - 1 Preferred stock; par value $0.0001, 515,779 shares authorized; 515,779 shares issued and outstanding as of September 30, 2021; aggregate liquidation preference of $2,892,300 as of September 30, 2021		2,892,300						2,892,300
Series A - 1 Preferred stock; par value $0.0001, 5,706,349 shares authorized; 5,706,349 shares issued and outstanding as of September 30, 2021; aggregate liquidation preference of $5,714,281 as of September 30, 2021		5,714,281						5,714,281
Series A - 2 Preferred stock; par value $0.0001, 2,574,478 shares authorized; 2,574,478 shares issued and outstanding as of September 30, 2021; aggregate liquidation preference of $2,778,882 as of September 30, 2021		2,778,882						2,778,882
Series A - 3 Preferred stock; par value $0.0001, 2,713,324 shares authorized; 2,621,569 shares issued and outstanding as of September 30, 2021; aggregate liquidation preference of $4,285,715 as of September 30, 2021		4,285,715						4,285,715
Series B Preferred stock; par value $0.0001, 5,131,673 shares authorized; 4,205,059 shares issued and outstanding as of September 30, 2021; aggregate liquidation preference of $56,726,260 as of September 30, 2021		56,726,260						56,726,260
Total temporary equity	$	74,290,250		$			$	74,290,250
Stockholders’ deficit
Common Stock, $0.0001 par value, 31,000,000 authorized; 3,955,279 shares issued and outstanding as of September 30, 2021		396						396
Treasury Stock, held at cost; 650,000 shares outstanding as of September 30, 2021		(221,000	)					(221,000	)
Additional paid-in capital		8,910,554						8,910,554
Accumulated deficit		(97,905,592	)		(2,467,340	)		(100,372,932	)
Total stockholders’ deficit		(89,215,642	)		(2,467,340	)		(91,682,982	)
Total liabilities, temporary equity and stockholders’ deficit	$	34,679,802			$(3,705,720)		$	30,974,082

43

Fast Radius Operations, Inc.

CONDENSED CONSOLIDATED STATEMENT OF NET LOSS AND COMPREHENSIVE LOSS

For the nine months ended September 30, 2021	As previously reported			Restatement impact			As Restated
Revenues	$	15,642,101		$	(2,062,892	)	$	13,579,209
Cost of revenues		14,089,162			(11,830	)		14,077,332
Gross profit		1,552,939			(2,051,062	)		(498,123	)
Operating expenses
Sales and marketing		15,520,744			(185,133	)		15,335,611
General and administrative		23,605,547			(1,104,451	)		22,501,096
Research and development		1,441,856			1,705,862			3,147,718
Total operating expenses		40,568,147			416,278			40,984,425
Loss from operations		(39,015,208	)		(2,467,340	)		(41,482,548	)
Change in fair value of warrants		(1,525,870	)		—			(1,525,870	)
Change in fair value of derivative liability		(189,000	)		—			(189,000	)
Interest income and other income		418			—			418
Interest expense, including amortization of debt issuance costs		(1,787,457	)		—			(1,787,457	)
Loss before income taxes		(42,517,117	)		(2,467,340	)		(44,984,457	)
Income tax expense (benefit)		—						—
Net loss and comprehensive loss	$	(42,517,117	)	$	(2,467,340	)	$	(44,984,457	)
Net loss per share
Basic and diluted	$	(10.41	)		(0.60	)	$	(11.01	)
Weighted average shares outstanding:
Basic and diluted		4,085,640						4,085,640

44

Fast Radius Operations, Inc.

CONDENSED CONSOLIDATED STATEMENT OF TEMPORARY EQUITY AND STOCKHOLDERS’ DEFICIT

	Convertible Preferred Stock1				Common Stock				Treasury Stock						Additional paid- in capital		Accumulated Deficit			Total
As previously reported	Shares		Amount		Shares		Amount		Shares			Amount			Amount		Amount			Amount
Balance at January 1, 2021		16,023,234	$	74,290,250		3,427,555	$	343		(650,000	)	$	(221,000	)	$	3,724,208	$	(55,388,475	)	$	(51,884,924	)
Net loss																		(42,517,117	)		(42,517,117	)
Issuance of equity warrants to related party																2,200,658					2,200,658
Issuance of equity warrants																2,245,000					2,245,000
Exercise of stock options and release of notes’ recourse provision						527,724		53								40,528					40,581
Stock-based compensation																700,160					700,160
Balance at September 30, 2020		16,023,234	$	74,290,250		3,955,279	$	396		(650,000	)	$	(221,000	)	$	8,910,554	$	(97,905,592	)	$	(89,215,642	)
Restatement impact
Net income			$				$					$			$		$	(2,467,340	)	$	(2,467,340	)
As Restated
Balance at January 1, 2021		16,023,234	$	74,290,250		3,427,555	$	343		(650,000	)	$	(221,000	)	$	3,724,208	$	(55,388,475	)	$	(51,884,924	)
Net loss																		(44,984,457	)		(44,984,457	)
Issuance of equity warrants to related party																2,200,658					2,200,658
Issuance of equity warrants																2,245,000					2,245,000
Exercise of stock options and release of notes’ recourse provision						527,724		53								40,528					40,581
Stock-based compensation																700,160					700,160
Balance at September 30, 2021		16,023,234	$	74,290,250		3,955,279	$	396		(650,000	)	$	(221,000	)	$	8,910,554	$	(100,372,932	)	$	(91,682,982	)

45

Fast Radius Operations, Inc.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

For the nine months ended September 30, 2021	As previously reported			Restatement impact			As Restated
Cash flows from operating activities
Net loss	$	(42,517,117	)	$	(2,467,340	)	$	(44,984,457	)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization		1,092,227			(63,034	)		1,029,193
Amortization of deferred financing fees and convertible debt discount		1,232,320						1,232,320
Stock-based compensation		700,160						700,160
Loss on disposal of assets		227,800						227,800
Change in fair value of warrants		1,525,870						1,525,870
Change in fair value of derivative liability		189,000						189,000
Provision for doubtful accounts		241,638						241,638
Other		(110,911	)					(110,911	)
Changes in operating assets and liabilities
Accounts receivable		(3,403,613	)		2,062,892			(1,340,721	)
Inventories		(275,863	)					(275,863	)
Prepaid production costs		(1,042,308	)					(1,042,308	)
Prepaid expenses and other current assets		(2,686,314	)		500,000			(2,186,314	)
Accounts payable		684,300						684,300
Accrued compensation and other liabilities		10,857,955			(1,238,380	)		9,619,575
Advances from customers		190,387						190,387
Deferred revenue		(5,350	)					(5,350	)
Cash used in operating activities	$	(33,099,819	)	$	(1,205,862	)	$	(34,305,681	)
Cash flows from investing activities
Additions to property, plant and equipment		(8,142,947	)		1,705,862			(6,437,085	)
Cash used in investing activities	$	(8,142,947	)	$	1,705,862		$	(6,437,085	)
Cash flows from financing activities
Proceeds from term loans	$	24,486,824						24,486,824
Repayment of term loans		(803,372	)					(803,372	)
Proceeds from convertible notes and warrants with related parties		10,600,000						10,600,000
Convertible notes issuance costs		(122,155	)					(122,155	)
Deferred financing fees		—			(500,000	)		(500,000	)
Proceeds from exercise of stock options		40,581						40,581
Cash provided by financing activities	$	34,201,878		$	(500,000	)	$	33,701,878
Change in cash and cash equivalents		(7,040,888	)					(7,040,888	)
Cash and cash equivalents, beginning of period		18,494,248						18,494,248
Cash and cash equivalents, end of period	$	11,453,360		$			$	11,453,360

46

EX-99.2

Exhibit 99.2

FAST RADIUS’ MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis provides information which Fast Radius’ management believes is relevant to an assessment and understanding of Fast Radius’ consolidated results of operations and financial condition. The discussion should be read together with Fast Radius’ financial statements and the notes thereto filed as Exhibit 99.1 to the amendment to the report on Form 8-K. In addition to historical financial information, this discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties. Fast Radius’ actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under “Risk Factors” in the report on Form 8-K. References in this section to “Fast Radius,” “we,” “us,” “our” and “the Company” are intended to mean the business and operations of Fast Radius Operations, Inc. and its consolidated subsidiary prior to the Business Combination and to the combined company after giving effect to the Business Combination.

Overview

We are a leading cloud manufacturing and digital supply chain company. Founded in 2017, we are headquartered in Chicago with offices in Atlanta, Louisville, and Singapore and micro-factories in Chicago and at the UPS Worldport facility in Louisville, Kentucky. As of December 31, 2021, we have approximately 325 full-time employees and work with companies across industries and throughout the product design and manufacturing lifecycle.

We have built our Cloud Manufacturing Platform which includes both physical infrastructure – Fast Radius micro-factories and third-party supplier factories – and a proprietary digital infrastructure software layer. Our Cloud Manufacturing Platform supports engineers, product developers, and supply chain professionals across the product design and manufacturing lifecycle.

We offer a wide and growing range of manufacturing technologies, including additive manufacturing (often referred to as 3D printing), CNC machining, injection molding, sheet metal, urethane casting, and other manufacturing methods. We offer these manufacturing capabilities through our own micro-factories as well as a network of curated third-party suppliers.

Recent Developments

Business combination

On February 4, 2022 (“the Closing Date”), Fast Radius Inc. (formerly named ECP Environmental Growth Opportunities Corp. (“ENNV”)) (the “Company”) consummated a business combination with Fast Radius Operations, Inc. (formerly named Fast Radius, Inc.) (“Legacy Fast Radius”), pursuant to which ENNV Merger Sub, Inc., a wholly owned subsidiary of ENNV (“Merger Sub”), merged with and into Legacy Fast Radius, with Legacy Fast Radius surviving the Merger as a wholly owned subsidiary of ENNV (the “Business Combination”). After giving effect to the Business Combination, the Company owns, directly or indirectly, all of the issued and outstanding equity interests of Legacy Fast Radius and its subsidiary and the equity holders of Legacy Fast Radius immediately prior to the Business Combination own a portion of the Company’s common stock, par value $0.0001 per share (“Common Stock”).

While the legal acquirer in the Business Combination is ENNV, for financial accounting and reporting purposes under U.S. GAAP (“GAAP”), Legacy Fast Radius was the accounting acquirer and the Business Combination was accounted for as a “reverse recapitalization.” A reverse recapitalization (i.e., a capital transaction involving the issuance of stock by ENNV for Legacy Fast Radius’ stock) does not result in a new basis of accounting, and the consolidated financial statements of the combined entity represent the continuation of the consolidated financial statements of Legacy Fast Radius in many respects. Accordingly, the consolidated assets, liabilities and results of operations of Legacy Fast Radius became the historical consolidated financial statements of the combined company, and ENNV’s assets, liabilities and results of operations were consolidated with those of Legacy Fast Radius beginning on the acquisition date. Operations prior to the Business Combination will be presented as those of Legacy Fast Radius in future reports. The net assets of ENNV were recognized at historical cost, with no goodwill or other intangible assets recorded.

Concurrently with the execution of the Merger Agreement, ENNV entered into subscription agreements (collectively, the “Subscription Agreements”), with certain third-party investors, including, among others, UPS, Palantir and the Sponsor (the “PIPE Investors”), pursuant to which the PIPE Investors agreed to subscribe for and purchase, and ENNV agreed to issue and sell, to the PIPE Investors an aggregate of 7,500,000 shares of Common Stock (the “PIPE Shares”) for a purchase price of $10.00 per share, or an aggregate purchase price of $75.0 million, in a private placement (the “PIPE Investment”). Under the Subscription Agreements, ENNV granted certain registration rights to the PIPE Investors with respect to the PIPE Shares. The PIPE Shares were issued concurrently with the closing of the Business Combination on the Closing Date.

Upon consummation of the Business Combination, the closing of the PIPE Investment and payment of certain other amounts that were contingent on the closing of the Business Combination, the most significant change in the post-combination company’s future reported financial position is an increase in cash and cash equivalents (as compared to Legacy Fast Radius’ consolidated balance sheet at December 31, 2021) to approximately $82 million, primarily due to $75.0 million in gross proceeds from the PIPE Investment and $29.6 million in proceeds from the Trust Account, partially offset by cash payments that were disbursed at the Closing which included $8.3 million of transaction expenses, $2.5 million in debt repayments, $8.2 million in directors’ and officers’ (“D&O”) insurance premiums, and $12.8 million related to IT and other costs.

In connection with the Business Combination, over 31.5 million ENNV shares were submitted for redemption. As a result, the condition to Fast Radius’ obligation to consummate the Business Combination that the amount of cash available in ENNV’s trust account immediately prior to the effective time of the Business Combination, after deducting the amount required to satisfy payments to ENNV stockholders in connection with the redemptions, the payment of any deferred underwriting commissions being held in ENNV’s trust account and the payment of certain transaction expenses, plus the gross proceeds from the PIPE Investment to be consummated in connection with the closing of the Business Combination, is equal to or greater than $175 million (such condition, the “Minimum Cash Condition”) was not satisfied. Therefore, in connection with the closing of the Business Combination, we waived the Minimum Cash Condition.

The reduction in available cash upon closing of the Business Combination due to those share redemptions may reduce our ability to invest in our growth strategy. To the extent that our resources are insufficient to satisfy our cash requirements, we may need to seek additional equity or debt financing. If the needed financing is not available, or if the terms of financing are less desirable than we expect, we may be forced to make changes to our long-term growth strategy in the discretion of our management and board of directors. These changes may include, but are not limited to, decreasing our level of investment in new product launches and related marketing initiatives and scaling back our existing operations, which could have an adverse impact on our business and financial prospects. Our future capital requirements and the adequacy of available funds will depend on many factors, including those set forth in the section titled “Risk Factors.”

In addition, as a consequence of the Business Combination, we became the successor to an SEC-registered and Nasdaq-listed company, which requires us to hire additional personnel and implement procedures and processes to address public company regulatory requirements and customary practices. We expect to incur additional annual expenses as a public company for, among other things, D&O liability insurance, director fees and additional internal and external accounting, legal and administrative resources, including increased audit and legal fees. Our future results of operations and financial position may not be comparable to historical results as a result of the Business Combination.

COVID-19 pandemic

In March 2020, the World Health Organization declared the outbreak of COVID-19 to be a pandemic. The COVID-19 pandemic is having widespread, rapidly evolving, and unpredictable impacts on global society, economies, financial markets, and business practices. Federal and state governments have implemented measures in an effort to contain the virus, including social distancing, travel restrictions, border closures, limitations on public gatherings, work from home policies, supply chain logistical changes, and closure of non-essential businesses. To protect the health and well-being of our employees, suppliers, and customers, we have made substantial modifications to employee travel policies, implemented office closures as employees are advised to work from home, and cancelled or shifted our conferences and other events to virtual-only through the date the financial statements were issued. The COVID-19 pandemic has impacted and may continue to impact our business operations, including our employees,

customers, partners, and communities, and there is substantial uncertainty in the nature and degree of its continued effects over time. COVID-19 and other similar outbreaks, epidemics or pandemics could have a material adverse effect on our business, financial condition, results of operations, cash flows and prospects as a result of any of the risks described above and other risks that we are not able to predict.

If the COVID-19 pandemic continues for a prolonged duration, we or our customers may be unable to perform fully on our contracts, which will likely result in increases in costs and reductions in revenue. These cost increases may not be fully recoverable or adequately covered by insurance. The long-term effects of COVID-19 to the global economy and to us are difficult to assess or predict and may include a further decline in the market prices of our products, risks to employee health and safety, risks for the deployment of our products and services and reduced sales in geographic locations impacted. Any prolonged restrictive measures put in place in order to control COVID-19 or other adverse public health developments in any of our targeted markets may have a material and adverse effect on our business operations and results of operation.

Key Factors Affecting Results

We believe that our future success will be dependent upon many factors, including those further discussed below. While each of these factors presents significant opportunities for our business, they also pose important challenges that we must successfully address in order to sustain our growth and improve the results of our operations.

Cost-effectively attracting new customers

A key growth driver for us is on-boarding new customers to our Cloud Manufacturing Platform. In addition to customer referrals and brand marketing, we acquire customers through three primary acquisition channels:

(1) digital marketing, (2) inside sales, and (3) business development. In order to continue our growth and scale to profitability, these customer acquisition investments must continue to yield new customers at a cost that is well below the long-term value of these new customers. This includes scaling the breadth of the customer-facing elements of our software and driving adoption of these software elements to reduce cost-to-serve.

Growing revenue within existing customers

When we acquire a new customer, we typically start our new relationship with a small number of custom parts. Once we successfully produce the customer’s initial order, customers will typically return to us for part replenishment and for consideration across new parts. This often requires customers to certify us as a production supplier, a process which often includes on-site factory audits, in-depth review of our quality management systems, and industry-specific capability verification and part-specific production verification (i.e., “PPAP”, or part production approval process). In order to grow our business with customers that require a production certification, we need to pass these supplier on-boarding elements and maintain the requirements necessary to be considered a certified supplier.

In order to continue our growth across all existing customers, we must produce high quality parts, expand our relationships within existing customers, and ultimately increase the number of parts for which we are the customer’s production partner. If we are unable to accomplish one or more of these requirements, our growth within existing customers may be impaired which could negatively impact our overall growth trajectory.

Expanding our micro-factory network

As we further enhance the front-end customer experience of our Cloud Manufacturing Platform and on-board new customers and new parts, we will need to continue expanding both our Fast Radius-owned micro-factories and our network of third-party suppliers.

Our micro-factories have been architected for scale since inception. The combination of our proprietary software operating system, replicable manufacturing operations, and strict quality control procedures are designed to ramp up new micro-factories quickly and cost-effectively. Each micro-factory is a deployment of a specific manufacturing technology (e.g., a micro-factory specific for Carbon DLS, another distinct micro-factory for CNC machining, etc.).

We evaluate our micro-factory expansion in two primary categories: (1) geographic expansion and (2) manufacturing technology expansion:

Micro-factory geographic expansion

Our micro-factory operations, software, and quality processes have been designed to be “copy and pasted” to new locations around the world. Similar to how other advanced manufacturing technologies have successfully scaled their manufacturing footprint (e.g., semi-conductor companies), we operate under a principle of “copy exactly” where every element of an initial micro-factory will be copied to the next micro-factory of the same technology. We control and maintain critical aspects of the operation – from the factory layout to materials handling to the technician “morning huddle” routine. This principle allows us to maintain consistent quality for production parts regardless of the micro-factory location in which the parts are being produced. This enables us to deliver solutions such as our Virtual Warehouse so that customers can have the confidence that if they need their part produced at a micro-factory in Chicago or a micro-factory in Louisville, the quality and consistency of the part will be the same, regardless of the location of production. As we expand our micro-factory footprint to locations around the world, this consistent quality of our “copy exactly” model will become even more important and valuable to our customers looking to produce parts proximate to where they are needed.

In order to successfully scale our micro-factory network, we must maintain this “copy and paste” approach to deliver the high-quality solutions we believe our customers will demand. If we are unable to maintain this consistent quality, on-time delivery, and cost structure across our network of micro-factories, our growth and profitability may be impaired.

Micro-factory technology expansion

We will also invest in new micro-factories which operate on manufacturing equipment that is different than the equipment we currently operate. Our technical team continually evaluates potential manufacturing technologies to invest in and we are also guided by input from our customers. Once we determine a new technology for which to create a micro-factory, we rely on our proven approach across software and processes to onboard these new manufacturing technologies onto the Cloud Manufacturing Platform. This allows us to ramp up new micro-factories while ensuring the quality, cost structure, and operational efficiencies are maintained across both existing and new micro-factories.

In order to continue expanding our manufacturing technology footprint, we must successfully invest in the software, technical evaluation, people resources, and business processes to enable the efficient ramp-up of micro- factories with new technologies.

Expanding our third-party supplier network

Our micro-factories are complemented by a curated network of third-party suppliers who provide manufacturing capacity across a range of technologies. As we scale, we need to continue to expand both the breadth and depth of our supplier network partnerships, including further integrating our Cloud Manufacturing Platform software tools into the operations of our supplier partners.

Expanding software-driven workflows and applications

A key component of the Cloud Manufacturing Platform is the software-driven workflows and applications for our customers and internal operations. In order to continue designing and building this software platform, we need to recruit and retain high quality product and software engineers. The market for product and software talent is very competitive and if we are not able to attract and retain the talent we need, the expansion of our software capabilities and Cloud Manufacturing Platform may proceed slower than expected, if at all.

Increasing gross margins

We earn a gross margin through selling custom component parts, some of which are produced within our micro-factories and others which are produced by third-party suppliers of Fast Radius. The gross margin of these two production methods varies and both methods have a cost structure and competitive dynamic which may fluctuate, leading to gross margins which may be different than our projections.

Specifically, in order to establish the micro-factory cost structure we are forecasting, we will need to operate our internal micro-factories at the utilization rates we are assuming in our cost models and maintain the pricing in the market that we have seen historically and anticipate will continue.

In order to maintain our gross margins through parts that are produced by third-party suppliers, we will need to continue to source high-quality components at a competitive cost and maintain the pricing with our end customers that we have seen historically. See “Risk Factors— Increased consolidation among our customers, suppliers and competitors in the advanced manufacturing industry may have an adverse effect on our business and results of operations” for further information.

Our forecasted gross margins assume a mix between parts that are produced within our own micro-factories and parts that are produced with third-party suppliers. If the mix between these production methods varies from our forecasted mix, our gross margins may be better or worse than we are forecasting.

Extending international operations

We plan to expand our operations outside of the United States. As we execute this expansion, we will face risks and uncertainties related to the market and regulatory environment of these new geographies. As a result, we may not be able to replicate the business performance we have seen in the United States in these international locations which may impact the overall financial performance of the business. Future international expansion will depend on many factors as set forth in the section titled “Risk Factors.”

Components of Operations

Revenues

Our primary source of revenue is from product sales of manufactured parts. We record revenue upon transfer of control to the customer. We have contracts with customers where the transfer of control of the specified good varies from contract to contract, but predominantly occurs upon shipment. We do not act as an agent in any of our customer contracts. We also derive revenue from ancillary consulting agreements. Under these arrangements, we produce digital assets (e.g., CAD files, finite element analyses, manufacturability reports) and physical assets (prototypes). For consulting arrangements, the goods and services delivered are generally combined into a single performance obligation based on not meeting the criteria for the goods and services being distinct within the context of the contract, and revenue is recognized over time or at a point-in-time based on contract terms. We view consulting arrangements as a mechanism to develop meaningful customer relationships and a driver of future product sales.

We charge certain customers shipping and handling fees. These fees are recorded within revenue after transfer of control of the products to customers.

Cost of Revenues

Cost of revenues consists primarily of outsourced production costs, materials, salaries and benefits of internal production staff, micro-factory rent, and subscription expense, depreciation, facilities costs and overhead allocations associated with the manufacturing process.

When shipping and handling services are performed before transfer of control to customers, they are accounted for as a fulfillment cost and are included in cost of revenues when incurred.

Operating Expenses

Sales and Marketing

Sales and marketing expense primarily consists of advertising expenses. Advertising expenses consist primarily of media advertising costs, trade and customer marketing expenses, sales and marketing related personnel, and public relations expenses which aim to strengthen the leadership of our brand in key vertical markets. All advertising expenses are recorded in Sales and marketing expense in the consolidated statements of net loss and comprehensive loss. Other expenses recorded in Sales and marketing include employee-related personnel expense and an allocated portion of overhead costs.

General and Administrative

General and administrative expense consists primarily of corporate employee compensation, benefits, leasehold improvement expenses, computer expenses and supplies, and other related overhead.

Research and development costs

We invest resources to advance the development of our products and services for our customers, including the development of the Cloud Manufacturing Platform. Research and development costs represent costs incurred to support the advancement of new and existing software, consumables, and activities to enhance manufacturing capabilities. Research and Development expenses consists of prototype parts, design expense, employee-related personnel expense, rent expense for machines for which we are testing new production processes and new materials on prior to being placed into production, and personnel costs for time spent on research and development efforts. As required by GAAP, eligible software development costs incurred during the application development stage are capitalized and subsequently amortized over the asset’s useful life once it is ready for its intended use.

Other Income (Expenses)

Change in fair value of warrants

We account for our warrants issued with other debt and equity instruments in accordance with Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity, and ASC 718, Compensation – Stock Compensation. In the event the terms of the warrants qualify for classification as a liability rather than equity, we account for the instrument as a liability recorded at fair value each reporting period with the change in fair value recognized through earnings.

Change in fair value of derivatives

We account for our derivative liabilities issued with and embedded in other debt instruments in accordance with ASC 815, Derivatives and Hedge Accounting. We account for the instruments as a liability recorded at fair value each reporting period with the change in fair value recognized through earnings. All outstanding derivative liabilities, along with the related convertible debt instruments, were converted into Common Stock at the closing of the Business Combination.

Interest income (expense), including amortization of debt discounts and issuance costs

Interest income varies each reporting period depending on our average cash balances during the period and the current level of interest rates. Interest expense consists of interest on outstanding debt as well as the amortization of debt discounts and issuance costs over the terms of the related debt agreements.

Results of Operations

Fiscal Year 2021 Compared with Fiscal Year 2020

The following table sets forth a summary of our consolidated results of operations, as well as the dollar and percentage change for the period:

	For the Year Ended December 31,
(Dollars in thousands)	2021			2020			Change ($)			Change (%)
Revenues		20,012			13,966			6,046			43	%
Cost of revenues (1)		20,300			12,039			8,261			69	%
Gross Profit		(288	)		1,927			(2,215	)		-115	%
Operating expenses
Sales and marketing (1)		22,721			8,328			14,393			173	%
General and administrative (1)		32,974			12,044			20,930			174	%
Research and development (1)		5,036			2,959			2,077			70	%
Total operating expenses		60,731			23,331			37,400			160	%
Loss from Operations		(61,019	)		(21,404	)		(39,615	)		-185	%
Change in fair value of warrants		(1,781	)		(80	)		(1,701	)		N.M.
Change in fair value of derivatives		(208	)		—			(208	)		N.M.
Interest income and other income		1			121			(120	)		N.M.
Interest expense, including amortization of debt issuance costs		(4,877	)		(308	)		(4,569	)		1,483	%
Loss before income taxes		(67,884	)		(21,671	)		(46,213	)		213	%
Provision for income taxes		—			—			—			N.M.
Net Loss		(67,884	)		(21,671	)		(46,213	)		213	%

N.M.—Percentage change is not meaningful

⁽¹⁾ Includes stock-based compensation, as follows:

Cost of Revenues	$	13	$	14	(1	)	-7	%
General and Administrative		680		826	(146	)	-18	%
Selling and Marketing		80		105	(25	)	-24	%
Research & Development		82		47	35		74	%
Total		855		992	(137	)	-14	%

Revenues

Revenues increased 43% from $14.0 million to $20.0 million for the year ended December 31, 2021. The increase in 2021 was attributable to sales from new customers and an increase in revenue from existing customers.

Cost of Revenues

Cost of revenues increased 69% from $12.0 million to $20.3 million for the year ended December 31, 2021. The increase in 2021 of cost of revenues was primarily attributable to the increase in revenues. Cost of revenues was also negatively impacted in 2021 by the recognition of cost from the shipment of goods to a customer that did not meet the U.S. GAAP requirements to recognize the related revenue. In addition, based on an internal review, we became aware of certain additional duties likely owed to the United States Customs and Border Protection (“CBP”). As a result, we recognized a $1.0 million charge within ‘Cost of revenues’ in the Consolidated Statement of Operations for the year ended December 31, 2021. Refer to Note 11 of the consolidated financial statements included elsewhere in this Report for additional information.

Operating Expenses

Sales and Marketing

Sales and marketing expenses increased 173% from $8.3 million to $22.7 million for the year ended December 31, 2021. The increase in sales and marketing expenses in 2021 was primarily attributable to increases in spend related to online advertising and marketing and promotional activities combined with organizational headcount growth within the function.

General and Administrative

General and administrative expenses increased 174% from $12.0 million to $33.0 million for the year ended December 31, 2021. The most significant increase in 2021 was attributable to incremental legal, consulting and accounting costs of $8.5 million to support the Company’s growth, including costs related to the Business Combination. Salary expenses and placement costs increased $3.6 million and $1.1 million, respectively, in 2021 as we expanded the team to support our growth. Rent expense increased $1.2 million in 2021 due to the expansion of office space. Also contributing to the increase in 2021 was $0.9 million related to contract employees and $1.1 million of recruiting costs.

We expect to record various expenses in 2022 that were contingent upon the close of the Business Combination. Such expenses are material to our results of operations and include stock-based compensation expense, cash bonuses that were due to certain of our founders and employees and expenses related to our agreement with Palantir Technologies Inc. (“Palantir”). We also expect to incur additional annual expenses as a public company for, among other things, D&O liability insurance, director fees and additional internal and external accounting, legal and administrative resources, including increased audit and legal fees.

Research and Development

Research and development expenses increased 70% from $3.0 million to $5.0 million for the year ended December 31, 2021. The $5.0 million of research and development expenses for the year ended December 31, 2021 included $7.9 million of gross research and development expenses, primarily related to our Cloud Manufacturing Platform, that was offset by $2.9 million of internal-use software costs that were capitalized. No software development costs were capitalized in 2020. The increase in gross spend in 2021 is attributable to our continued focus on developing the Cloud Manufacturing Platform.

Change in fair value of warrants

The increase in expense related to mark to market adjustments on warrant liabilities in 2021 was attributable to a higher number of warrants outstanding due to 2021 issuances and an increase in our enterprise valuation. Refer to Note 8 and Note 10 of the consolidated financial statements included elsewhere in this Report for additional information on warrant liabilities.

Change in fair value of Derivatives

The expense recorded in 2021 was attributable to mark to market adjustments on embedded derivatives associated with 2021 convertible debt issuances. All outstanding derivative liabilities, along with the related convertible debt instruments, were converted into Common Stock at the closing of the Business Combination. Refer to Note 5 and Note 10 of the consolidated financial statements included elsewhere in this Report for additional information on derivative liabilities.

Interest income and other income

The decrease in interest income was primarily attributable to a decrease in our average money market account balance in 2021 as compared to 2020.

Interest expense, including amortization of debt issuance costs

The increase in interest expense was primarily attributable to higher outstanding debt levels in 2021 compared to 2020. Refer to Note 5 of the consolidated financial statements included elsewhere in this Report for additional information on debt issuances.

Non-GAAP Financial Measures

In addition to our results determined in accordance with GAAP, we believe the below non-GAAP financial measures are useful in evaluating our operational performance. We use this non-GAAP financial information to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that this non-GAAP financial information, when taken collectively, may be helpful to investors in assessing our operating performance.

We define “EBITDA” as net loss plus interest expense, income tax expense, depreciation and amortization expense.

We define “Adjusted EBITDA” as EBITDA adjusted for stock-based compensation, changes in the fair value of warrant liability, changes in the fair value of derivative liabilities, and transaction and related costs.

To provide investors with additional information regarding our financial results, we are presenting EBITDA and Adjusted EBITDA, non-GAAP financial measures, in the table below along with a reconciliation to net loss, the most directly comparable measure calculated and presented in accordance with GAAP.

Adjusted EBITDA

We consider Adjusted EBITDA to be an important measure because it helps illustrate underlying trends in our business and our historical operating performance on a more consistent basis.

Our definition of Adjusted EBITDA may differ from that used by other companies and therefore comparability may be limited. In addition, other companies may not present Adjusted EBITDA or similar metrics. Thus, our adjusted EBITDA should be considered in addition to, not as a substitute for, or in isolation from, measures prepared in accordance with GAAP, such as net loss.

In addition, Adjusted EBITDA has limitations as an analytical tool, including:

• although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and Adjusted EBITDA does not reflect cash used for capital expenditures for such replacements or for new capital expenditures;

• Adjusted EBITDA does not include the dilution that results from stock-based compensation or any cash outflows included in stock-based compensation, including from our purchases of shares of outstanding common stock;

• Adjusted EBITDA does not reflect tax payments that may represent a reduction in cash available to us; and other companies may calculate Adjusted EBITDA differently, which reduces its usefulness as a comparative measure.

We provide investors and other users of our financial information with a reconciliation of Adjusted EBITDA to net loss. We encourage investors and others to review our financial information in its entirety, not to rely on any single financial measure and to view Adjusted EBITDA in conjunction with net loss.

Stock-based compensation is a non-cash expense relating to stock-based awards issued to executive officers, employees, and outside directors, consisting of options and restricted stock units. We exclude this expense because it is a non-cash expense and we assess our internal operations excluding this expense, and we believe it facilitates comparisons to the performance of other companies in our industry.

Change in the fair value of warrant liability is a non-cash gain or loss impacted by the fair value of the issued liability-classified warrants. We believe the assessment of our operations excluding this activity is relevant to our assessment of internal operations and to comparisons with the performance of other companies in our industry.

Change in the fair value of derivative liabilities is a non-cash gain or loss impacted by the fair value of the derivative liabilities. We believe the assessment of our operations excluding this activity is relevant to our assessment of internal operations and to comparisons with the performance of other companies in our industry.

Transaction and related costs are costs for advisory, consulting, accounting and legal expenses in connection with the Business Combination.

Change in Non-GAAP Measurement

For the year ended December 31, 2021, we excluded from the definition of “Transaction and related costs” certain costs that were included in “Transaction costs” for the nine months ended September 30, 2021. Specifically, we excluded costs for advisory, consulting and other expenses that, while related to the Business Combination, were recurring in nature and incurred as part of the Company’s growth strategy. Therefore, we have excluded these costs as a non-GAAP adjustment for the year ended December 31, 2021 to illustrate underlying trends in our business and our historical operating performance on a more consistent basis. These costs amounted to approximately $2.6 million for the nine months ended September 30, 2021.

The following table provides a reconciliation of net loss, the most closely comparable GAAP financial measure, to EBITDA and Adjusted EBITDA:

	For the Year Ended, December 31
(Dollars in thousands)	2021			2020
Net loss	$	(67,884	)	$	(21,671	)
Interest expense		4,877			308
Income tax expense (benefit), net		—			—
Depreciation and amortization		1,653			842
EBITDA		(61,354	)		(20,521	)
Stock compensation expense		855			992
Change in fair value of warrant liability		1,781			80
Change in fair value of derivative liabilities		208			—
Transaction and related costs		5,194			—
Adjusted EBITDA		(53,316	)		(19,449	)

Liquidity and Capital Resources

We measure liquidity in terms of our ability to fund the cash requirements of our business operations, including working capital and capital expenditure needs, contractual obligations and other commitments, with cash flows from operations and other sources of funding. Our current liquidity needs include the working capital to support the purchase of custom component parts from our third-party supplier partners on behalf of our customers. In many cases, we pay our suppliers prior to being paid by our customers, resulting in a need for working capital. We also consume cash through other growth initiatives, including investing in new micro-factories, sales and marketing expenses and development of our Cloud Manufacturing Platform. Our ability to expand and grow our business will depend on many factors, including our working capital needs and the evolution of our operating cash flows.

We had $8.7 million in cash and cash equivalents as of December 31, 2021. Upon consummation of the Business Combination, we received approximately $73 million in cash, primarily due to $75.0 million in gross proceeds from the PIPE Investment and $29.6 million in proceeds from the Trust Account, partially offset by cash payments that were disbursed at the Closing which included $8.3 million of transaction expenses, $2.5 million in debt repayments, $8.2 million in D&O insurance premiums, and $12.8 million related to IT and other costs.

We expect our capital expenditures and working capital requirements to continue to increase in the immediate future as we are still in the growth stage of our business and expect to continue to make substantial investments in our business, including in the expansion of our product portfolio and research and development, sales and marketing teams, in addition to incurring additional costs as a result of being a public company. Our short-term liquidity priorities are to pay off existing indebtedness, to fund ongoing working capital needs, and to invest in the Combined Company’s growth strategy.

We believe the cash we obtained from the Business Combination and the PIPE Investment are not sufficient to meet our working capital and capital expenditure requirements for a period of at least twelve months from the date of these financial statements. We expect to generate additional cash to fund our growth through future debt or equity transactions; however, there can be no assurance that we will be able to obtain other debt or equity financing on terms acceptable to us, if at all, or that we will generate sufficient future revenues and cash flows to fund our operations. Failure to secure additional funding may require us to modify, delay, or abandon some of our planned future expansion or development, or to otherwise enact operating cost reductions available to management, which could have a material adverse effect on our business, operating results, financial condition, and ability to achieve our intended business objectives. Our future capital requirements and the adequacy of available funds will depend on many factors, including those set forth in the section titled “Risk Factors.”

Liquidity

As of December 31, 2021, excluding the derivative liabilities, we had $42.5 million in debt, net of discounts and issuance costs, outstanding. Refer to Note 5 of the consolidated financial statements included elsewhere in this Report for additional information on our outstanding debt liabilities.

On February 4, 2022, the 2021 SVB Loan was amended to extend the maturity date from the Closing Date to April 3, 2023 and required payment of $2.0 million of the $20.0 million outstanding principal balance upon consummation of the Business Combination. This amendment also added the original $0.8 million fee due at the SPAC closing to the amended loan’s outstanding principal balance, deferring its repayment until maturity. In exchange for the extension of the loan, we will pay an additional fee of $2.1 million due at maturity. We will make six interest-only payments beginning March 1, 2022 and will begin paying $2.4 million in principal beginning September 1, 2022.

Additionally, on February 4, 2022, as part of the closing of the Business Combination, the related party convertible notes that had a carrying value of $12.5 million as of December 31, 2021 were converted into Common Stock. 6,891,667 ENNV liability-classified warrants were also assumed as part of the Business Combination with a carrying and fair value of $10.4 million as of December 31, 2021.

Other commitments

In May 2021, we entered into a master subscription agreement with Palantir for access to Palantir’s proprietary software for a six-year period for a total of $45.0 million. The non-cancellable future minimum payments due on this firm purchase agreement are $10.1 million after taking into account the $9.4 million payment made to Palantir at Close. Refer to Note 11 of the consolidated financial statements included elsewhere in this Current Report on Form 8-K for additional information on our agreement with Palantir.

Cash Flows

The following table sets forth a summary of cash flows for the years ended December 31, 2021 and 2020:

	For the Year Ended, December 31
(Dollars in thousands)	2021			2020
Net cash used in operating activities	$	(48,771	)	$	(20,904	)
Net cash used in investing activities		(8,622	)		(712	)
Net cash provided by financing activities		47,601			5,294
Net decrease in cash	$	(9,792	)	$	(16,322	)

Operating Activities

Cash used in operating activities for the years ended December 31, 2021 and 2020 was $48.8 million and $20.9 million, respectively. The increase in operating cash outflows in 2021 was primarily due to higher operating losses in the current year.

In 2022, we used a portion of the proceeds from the Business Combination described below in Financing Activities to make cash payments related to various transaction and other costs of approximately $29.3 million that became due upon the close of the Business Combination.

Investing Activities

Cash used in investing activities for the years ended December 31, 2021 and 2020 was $8.6 million and $0.7 million, respectively. The increase was attributable to higher purchases of property and equipment and capitalized software development costs during the period.

Financing Activities

Cash provided by financing activities for the years ended December 31, 2021 and 2020 was $47.6 million and $5.3 million, respectively. The increase was primarily attributable to the proceeds from term loans and related party convertible notes, respectively, partially offset by term loan repayments.

In 2022, we received proceeds from the Business Combination of approximately $105.8 million. A portion of those proceeds were used to settle debt obligations of $2.5 million and to pay various transaction and other expenses as described in Operating Activities above. Refer to Note 15 of the consolidated financial statements included elsewhere in this Report for additional information on the Business Combination.

Off-Balance Sheet Arrangements

As of December 31, 2021 and 2020, we did not have any off-balance sheet arrangements, as defined in Regulation S-K, Item 303(a)(4)(ii).

Critical Accounting Policies and Estimates

The preparation of consolidated financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Our most significant estimates and judgements involve valuation of our equity, including assumptions made in the fair value of stock-based compensation and warrants, and convertible debt, including assumptions made in the fair value of embedded derivative liabilities. Although we regularly assess these estimates, actual results could differ materially from these estimates. Changes in estimates are recorded in the period in which they become known. We base our estimates on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ from management’s estimates if these results differ from historical experience or other assumptions prove not to be substantially accurate, even if such assumptions are reasonable when made.

Our significant accounting policies are described in Note 2 of the consolidated financial statements included elsewhere in this Report. Our critical accounting policies are described below.

Stock-Based Compensation

We account for stock-based compensation awards in accordance with FASB ASC Topic 718, Compensation—Stock Compensation (“ASC 718”). ASC 718 requires all stock-based payments to employees and nonemployees, including grants of stock options, restricted stock, restricted stock units (“RSUs”), and modifications to existing stock awards, to be recognized in the statements of net loss and comprehensive loss based on their fair values. Our stock-based awards are comprised of stock options and RSUs. Stock options and RSUs are assigned a fair market value when granted. The fair value of the common stock options and RSUs are estimated using the Black Scholes option-pricing model or the Monte Carlo Simulation model.

Our stock-based awards are subject to service and/or performance-based vesting conditions. We recognize compensation expenses for awards with only a service condition, over the explicit service period using the straight-line method. For awards subject to a service and performance condition, compensation cost is recognized over the longer of the explicit, implicit, or derived period using the accelerated attribution method for cost allocation, as long as the performance condition is probable of achievement. At each reporting period, we evaluate the probability that our performance-based stock options will be earned and adjust our previously recognized compensation expense as necessary. If the achievement of the respective performance condition is not probable or the respective performance goals are not met, we reverse our previously recognized compensation expense.

We account for stock-based compensation awards issued to nonemployees for services, as prescribed by ASC 718-10, at either the fair value of the services rendered or the instruments issued in exchange for such services, whichever is more readily determinable using the measurement date guidelines enumerated in ASU 2018-07, Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-07”). Refer to Note 9 of the consolidated financial statements included elsewhere in this Report for further detail.

Enterprise valuations

We are required to estimate the enterprise value underlying our equity-based awards when performing fair value calculations. Due to the prior absence of a market for our equity interests, our enterprise value was determined by management with the assistance of valuation specialists. Our management considers the following factors in the determination of our enterprise value:

• Material changes in milestones established by the entity

• Material changes in management’s forecast

• Material changes in strategic relationships with major suppliers or customers

• Material changes in enterprise cost structure and financial condition

• Material change in the state of the industry and economy

• Material changes in competence of management team

• Material changes in workforce and workforce skills

• Material changes in existing proprietary technology, products, or services

• Material third-party arm’s-length transactions in the entity’s equity

• Material changes in valuation assumptions used in the last valuation

In determining the March 2019 and March 2020 valuations, we used an option pricing model (“OPM”) using a market-based valuation approach to determine the common stock fair value, while incorporating a Back solve approach to the Series B Preferred Equity issuances that took place at an arms-length in March 2019 and March 2020.

On December 22, 2020, we formally decided to pursue a transaction with a SPAC and held an initial meeting with prospective legal, investment banking and other advisors to communicate the intention to start discussions with a SPAC. On January 18, 2021, we formally engaged our investment banking advisor to support a prospective SPAC transaction. As a result, commencing with the December 31, 2020 and subsequent valuations, we applied a Probability Weighted Expected Return Valuation Method (“PWERM”). The PWERM model applies an estimation of future potential outcomes for a company, as well as values and probabilities associated with each respective potential outcome. We were valued under both “Remain Private” and “SPAC Acquisition” scenarios. The inputs to the valuation under the “SPAC Acquisition” scenario are based on the higher fair value implied by the Business Combination. As of December 31, 2020, our management estimated a 5.0% probability associated with a SPAC transaction occurring within 2021 and a 95.0% probability of remaining private for approximately two years. The probability of a SPAC increased as the SPAC transaction became more likely. Details of the Company’s recent enterprise valuations are as follows:

Valuation Date	Common Stock Per Share Value		Valuation Model		Enterprise Value of Company (Private)		Enterprise Value of Company (SPAC)		SPAC Likelihood			Enterprise Value of Company (Weighted Average)
March 31, 2019	$	1.77		OPM		—		—		—		$	105,227,000
March 31, 2020	$	1.97		OPM		—		—		—		$	123,389,000
December 31, 2020	$	4.11		PWERM	$	128,300,000	$	809,322,034		10	%	$	196,402,203
February 14, 2021	$	16.53		PWERM	$	405,100,000	$	1,000,390,383		40	%	$	643,216,153
May 17, 2021	$	21.21		PWERM	$	498,000,000	$	951,000,000		65	%	$	792,450,000
September 7, 2021	$	25.77		PWERM	$	578,000,000	$	973,000,000		85	%	$	913,750,000
December 31, 2021	$	28.05		PWERM	$	586,000,000	$	970,000,000		95	%	$	950,800,000

Based on the per share merger consideration to be paid by ENNV pursuant to the Merger Agreement, after accounting for the conversion exchange ratio that will be used in calculating the amount of such per share merger consideration, the implied fully diluted share price for our common stock immediately prior to Closing was $10.00 per share. The private company valuations of our board of directors differ from the public company valuation of us by ENNV and the PIPE Investors principally due to the private company discount for the lack of marketability and probability of various scenarios/liquidity events at various points in time.

Preferred Stock Subject to Possible Redemption

We account for our preferred stock subject to possible redemption in accordance with the guidance in ASC Topic 480 Distinguishing Liabilities from Equity. Conditionally redeemable preferred stock (including preferred 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 our control) is classified as temporary equity. Our preferred stock features certain redemption rights that are considered to be outside of our control and subject to occurrence of uncertain future events. Accordingly, preferred stock subject to possible redemption is presented at redemption value as temporary equity, outside of the stockholders’ equity section of our consolidated balance sheets. The preferred stock is not currently redeemable, but it is probable that the preferred stock will become redeemable in the future and therefore, we have elected an accounting policy to subsequently measure the preferred stock at current redemption value. Upon close of the Business Combination, all preferred stock was converted into Common Stock.

Warrants

We account for our warrants issued with other debt and equity instruments in accordance with ASC 480, Distinguishing Liabilities from Equity (“ASC 480”), and ASC 718. In the event the terms of the warrants qualify for classification as a liability rather than in equity, we account for the instrument as a liability recorded at fair value each reporting period with the change in fair value recognized through earnings. For the years ended December 31, 2021 and 2020, we measured the fair value of warrants using significant unobservable inputs (Level 3 inputs). Refer to Note 8 of the consolidated financial statements included elsewhere in this Report for further information regarding warrants.

Derivative Liabilities

We account for our derivative liabilities issued with and embedded in other debt instruments in accordance with ASC 815, Derivatives and Hedge Accounting. We account for the instruments as a liability recorded at fair value using Level 3 inputs each reporting period with the change in fair value recognized through earnings. All outstanding derivative liabilities, along with the related debt instruments, were converted into Common Stock at the closing of the Business Combination. Refer to Note 5 of the consolidated financial statements included elsewhere in this Report for further information regarding derivative liabilities issued with and embedded in other debt instruments.

Recent Accounting Pronouncements and EGC status

As an emerging growth company (“EGC”), the Jumpstart Our Business Startups Act (“JOBS Act”) allows us to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are applicable to private companies. We have elected to use this extended transition period under the JOBS Act until such time we are no longer considered to be an EGC. The adoption dates discussed below reflect this election. Accordingly, the information contained herein may be different than the information you receive from other public companies.

We also intend to take advantage of some of the reduced regulatory and reporting requirements of emerging growth companies pursuant to the JOBS Act so long as we qualify as an emerging growth company, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act, and reduced disclosure obligations regarding executive compensation.

From time to time, new accounting pronouncements are issued by the FASB under its ASC or other standard setting bodies. Recent accounting pronouncements are described in the Recently Issued Accounting Pronouncements section of Note 2 – Summary of Significant Accounting Policies included elsewhere in this Report.

XML

Document and Entity Information	Feb. 04, 2022
Document And Entity Information [Line Items]
Amendment Flag	true
Entity Central Index Key	0001832351
Document Type	8-K/A
Document Period End Date	Feb. 04, 2022
Entity Registrant Name	Fast Radius, Inc.
Entity Incorporation State Country Code	DE
Entity File Number	001-40032
Entity Tax Identification Number	85-3692788
Entity Address, Address Line One	113 N. May Street
Entity Address, City or Town	Chicago
Entity Address, State or Province	IL
Entity Address, Postal Zip Code	60607
City Area Code	(888)
Local Phone Number	787-1629
Written Communications	false
Soliciting Material	false
Pre Commencement Tender Offer	false
Pre Commencement Issuer Tender Offer	false
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Amendment Description	This Amendment No. 1 on Form 8-K/A (“Amendment No. 1”) amends the Current Report on Form 8-K of Fast Radius Inc., a Delaware corporation (formerly named ECP Environmental Growth Opportunities Corp. (“ENNV”)) (the “Company”), filed on February 10, 2022 (the “Original Report”), in which the Company reported, among other events, the completion of the Business Combination (as defined in the Original Report) between the Company and Fast Radius Operations, Inc., a Delaware corporation (formerly named Fast Radius, Inc.) (“Legacy Fast Radius”), on February 4, 2022 (the “Closing Date”). This Amendment No. 1 is being filed in order to (i) update and supplement certain risk factors under the header “Risk Factors” in Item 2.01 of the Original Report and (ii) include (a) the Management’s Discussion and Analysis of Financial Condition and Results of Operations of Legacy Fast Radius for the years ended December 31, 2020 and 2021 and (b) the audited financial statements of Legacy Fast Radius as of and for the years ended December 31, 2020 and 2021. Except as set forth herein, this Amendment No. 1 does not amend any other item of the Original Report or purport to provide an update or a discussion of any developments at the Company or its subsidiaries subsequent to the filing date of the Original Report. The information previously reported in or filed with the Original Report is hereby incorporated by reference to this Amendment No. 1.
Class A Common Stock Par Value 0.0001 Per Share 1 [Member]
Document And Entity Information [Line Items]
Security 12b Title	Common Stock, par value $0.0001 per share
Trading Symbol	FSRD
Security Exchange Name	NASDAQ
Warrants Each Whole Warrant Exercisable For One Share Of Class A Common Stock At An Exercise Price Of 11.50 Per Share [Member]
Document And Entity Information [Line Items]
Security 12b Title	Warrants, each whole warrant exercisable for one share of common stock at an exercise price of $11.50 per share
Trading Symbol	FSRDW
Security Exchange Name	NASDAQ