What changed in this filing

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

2023-03-15 compared with 2022-03-30 · 593 added, 547 removed, 729 unchanged (61% of the section changed)

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We continue to experience foreign currency fluctuations primarily due to the periodic re-measurement of our foreign currency monetary account balances that are denominated in currencies other than the functional currency of the entities in which they are recorded.

Changes in exchange rates may negatively affect our revenue and other operating results as expressed in U.S.

Changes in exchange rates may negatively affect our revenue and other results of operations as expressed in U.S.

We do not currently engage in foreign exchange hedging contracts.

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We have experienced and will continue to experience fluctuations in our net loss as a result of gains or losses related to revaluing certain asset and current liability balances that are denominated in currencies other than the functional currency of the entities in which they are recorded.

For our fiscal years 2021 and 2020, we had a loss of $1.9 million and $0.1 million, respectively.

For fiscal year 2022 and fiscal year 2021, we had a loss due to changes in foreign currency exchange rates of $0.9 million and $1.9 million, respectively.

A hypothetical 10% strengthening or weakening of the U.S.

dollar relative to the currencies in which our revenue and expenses are denominated would have resulted in an increase or decrease, respectively, in our reported fiscal year 2021 pre-tax loss of approximately $1.8 million.

dollar relative to the currencies in which our revenue and expenses are denominated would have resulted in an increase or decrease in our reported fiscal year 2022 pre-tax loss of approximately $2.6 million.

Interest rate sensitivity

We had cash and cash equivalents totaling $109.3 million as of December 31, 2021.

This amount was held primarily in demand deposit accounts.

We had cash and cash equivalents totaling $47.2 million and short-term marketable securities of $23.1 million as of December 31, 2022.

These amounts were held primarily in demand deposit accounts and short-term marketable securities.

The cash and cash equivalents are held for working capital purposes or strategic investment purposes.

We do not enter into investments for trading or speculative purposes.

As of December 31, 2021, the FP Term Loan had a fixed rate of 9.0% with no exposure to interest rate fluctuations.

We are exposed to market risks related to fluctuations in interest rates related to the Blue Torch Credit Facility.

The Blue Torch Credit Facility accrues interest at a floating rate, to be based, at our election, on either a reference rate or a 3-month Term SOFR rate (subject to a 1.0% floor), plus an interest rate margin of 7.0% for reference rate borrowings and 8.0% for 3-month Term SOFR borrowings, plus an incremental Term SOFR margin of 0.26161% .

Accordingly, increases in SOFR could increase our interest payments under the Blue Torch Credit Facility.

For example, a hypothetical increase of 100 basis points in the interest rate of the Blue Torch Credit Facility would have an approximately $1.2 million impact on an annual basis on our results of operations.

The SIF loan is interest free.

Inflation Risk

We are exposed to inflation risk.

Inflationary factors, such as increases in component parts, labor and other overhead expenses, could impair our operating results.

Although there has been a significant increase in inflation in the recent period, it has not had a substantial impact on our results of operations for fiscal years 2022 or 2021.

However, a higher rate of inflation in the future may have a negative impact on our operational and capital expenditures which we may not be able to pass along as cost increases to our customers.

Financi al Statements and Supplemental Data

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We have audited the accompanying consolidated balance sheets of Spire Global, Inc.

and its subsidiaries (the “Company”) as of December 31, 2021 and 2020, and the related consolidated statements of operations, of comprehensive loss, of changes in stockholders’

equity (deficit) and of cash flows for the years then ended, including the related notes (collectively referred to as the “consolidated financial statements”).

and its subsidiaries (the “Company”) as of December 31, 2022 and 2021, and the related consolidated statements of operations, of comprehensive loss, of changes in stockholders' equity (deficit) and of cash flows for the years then ended, including the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

Change in Accounting Principle

As discussed in Note 2 to the consolidated financial statements, the Company changed the manner in which it accounts for leases as of January 1, 2022.

Basis for Opinion

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Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated 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 consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

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Cash and cash equivalents

Marketable securities

Accounts receivable, net (including allowance of $ 395 and $ 339 as of December 31,

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Property and equipment, net

Operating lease right-of-use assets

Customer relationships

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Liabilities and Stockholders’

Equity (Deficit)

Current liabilities

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Contingent earnout liability

Convertible notes payable, net (including related parties of $ 0 and $ 7,498 as of December 31,

2021 and 2020, respectively)

Deferred income tax liabilities

Warrant liability

Operating lease liabilities, net of current portion

Other long-term liabilities

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Stockholders’

equity (deficit)

Series A preferred stock, $ 0.0001 par value, none authorized, issued and outstanding at

December 31, 2021 and 12,671,911 shares authorized, 21,615,723 shares issued and outstanding

at December 31, 2020 (liquidation value of $ 52,809 at December 31, 2020)

Series B preferred stock, $ 0.0001 par value, none authorized, issued and outstanding at

December 31, 2021 and 4,869,754 shares authorized, 8,306,818 shares issued and outstanding

at December 31, 2020 (liquidation value of $ 35,228 at December 31, 2020)

Series C preferred stock, $ 0.0001 par value, none authorized, issued and outstanding at

December 31, 2021 and 9,126,525 shares authorized, 12,804,176 shares issued and outstanding

at December 31, 2020 (liquidation value of $ 65,222 at December 31, 2020)

Common stock, $ 0.0001 par value, 1,000,000,000 Class A and 15,000,000 Class B shares

authorized, 139,096,000 Class A and 12,058,614 Class B shares issued and outstanding at

December 31, 2021;

55,000,000 shares authorized, 17,664,015 Class A shares issued and

outstanding at December 31, 2020

Common stock, $ 0.0001 par value, 1,000,000,000 Class A and 15,000,000 Class

B shares authorized, 143,679,385 Class A and 12,058,614 Class B shares issued

and outstanding at December 31, 2022;

139,096,000 Class A and 12,058,614 Class

B shares issued and outstanding at December 31, 2021

Additional paid-in capital

Accumulated other comprehensive income (loss)

Accumulated other comprehensive (loss) income

Accumulated deficit

Total stockholders’

equity (deficit)

Total liabilities and stockholders’

equity (deficit)

The accompanying notes are an integral part of these consolidated financial statements.

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General and administrative

Loss on satellite deorbit and launch failure

Loss on decommissioned satellites

Total operating expenses

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Change in fair value of warrant liabilities

Other (expense) income, net

Total other income (expense), net

Loss on extinguishment of debt

Other expense, net

Total other (expense) income, net

Loss before income taxes

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Year Ended December 31,

Other comprehensive loss:

Other comprehensive gain (loss):

Foreign currency translation adjustments

Net unrealized loss on investments

Comprehensive loss

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Stockholders'

Balance, January 1, 2020

Exercise of stock options

Stock compensation

Issuance of stock warrants

Foreign currency

translation adjustments

Income (Loss)

Equity (Deficit)

Balance, December 31, 2020

Exercise of stock options

Exercise of stock

Stock compensation

Issuance of common stock

relating to the acquisition

Issuance of shares to FP

Lenders (Note 8)

Exercise of Series C

preferred warrants

Conversion of warrants to

Conversion of Series A

preferred stock to

common stock upon the

reverse recapitalization

Conversion of Series B

preferred stock to

common stock upon the

reverse recapitalization

Conversion of Series C

preferred stock to

common stock upon the

reverse recapitalization

Conversion of convertible

notes to common stock

Issuance of common

stock relating to

the acquisition

Partners, L.P.

Conversion of

upon the reverse

recapitalization,

Issuance of common stock

upon the reverse

recapitalization and PIPE

financing, net of merger

Contingent earnout liability

upon closing of the

net of issuance

Contingent earnout

liability recognized

upon the closing of

recapitalization

Foreign currency

translation adjustments

Balance, December 31, 2021

Exercise of stock

Release of Restricted

Issuance of common

stock under Employee

Stock Purchase Plan

Stock compensation

Conversion of

Foreign currency

Net unrealized loss

on investments

Balance, December 31, 2022

(1) The shares of the Company’s common and convertible preferred stock, prior to the Merger (as defined in Note 1) have been retroactively restated to reflect the exchange ratio of approximately 1.7058 established in the Merger.

as described in Note 3.

(2) Included in the share number is 12,058,614 shares of Class B common stock.

The accompanying notes are an integral part of these consolidated financial statements.

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Depreciation and amortization

Loss on disposal of property and equipment

Loss on impairment of intangible assets

Stock-based compensation

Amortization of operating lease right-of-use assets

Accretion on carrying value of convertible notes

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Deferred income tax liabilities

Loss on impairment of assets and decommissioned satellites

Loss on extinguishment of debt

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Other accrued expenses

Operating lease liabilities

Other long-term liabilities

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Cash flows from investing activities

Purchases of short-term investments

Maturities of short-term investments

Purchase of property and equipment

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Proceeds from long-term debt

Payments on long-term debt

Proceeds from issuance of convertible notes payable

Payments on redemption of long-term debt

Payments on redemption of warrants

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Proceeds from exercise of stock options

Proceeds from employee stock purchase plan

Net cash provided by financing activities

Effect of foreign currency translation on cash, cash equivalent and restricted cash

Net increase (decrease) in cash, cash equivalents and restricted cash

Net (decrease) increase in cash, cash equivalents and restricted cash

Cash, cash equivalents and restricted cash

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Cash paid for interest

Income taxes paid

Noncash investing and financing activities

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Issuance of shares in the acquisition

Conversion of warrants to Class A common stock

Exercise of Series C preferred stock warrants

Property and equipment purchased but not yet paid

Issuance of stock warrants with long-term debt

Issuance of stock warrants with long-term debt (Note 8)

The accompanying notes are an integral part of these consolidated financial statements.

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(Luxembourg), Spire Global Singapore Pte.

(Singapore) and Spire Global Canada Acquisition Corp.

(Singapore), Spire Global Australia Pty Ltd.

(Australia), and Spire Global Canada Acquisition Corp.

Spire Global Canada Acquisition Corp.

is the sole owner of exactEarth Ltd.

(Canada), which in turn is the sole owner of exactEarth Europe Ltd.

(Canada) ("exactEarth"), which in turn is the sole owner of exactEarth Europe Ltd.

(England and Wales).

The Company currently operates offices in seven locations:

San Francisco, Boulder, Washington D.C.

(U.S.), Glasgow (U.K.), Luxembourg, Cambridge, Ontario, and Singapore.

The Company currently operates offices in nine locations:

San Francisco (U.S.), Boulder (U.S.), Vienna (U.S.), Glasgow (U.K.), Oxfordshire (U.K.), Luxembourg, Cambridge (U.K.), Ontario (Canada), and Singapore.

On August 16, 2021 (the “Closing Date”), Spire Global Subsidiary, Inc.

(formerly known as Spire Global, Inc.) (“Old Spire”) closed its previously announced merger with NavSight Holdings, Inc.

(“NavSight”), a special purpose acquisition company, pursuant to the terms of the Business Combination Agreement, dated as of February 28, 2021, by and among Spire, NavSight, NavSight Merger Sub, Inc., a wholly owned subsidiary of NavSight (“NavSight Merger Sub”), and Peter Platzer, Theresa Condor, Jeroen Cappaert, and Joel Spark (collectively, the “Old Spire Founders,”

(formerly known as Spire Global, Inc.) (“Legacy Spire”) closed its previously announced merger with NavSight Holdings, Inc.

and such agreement, the “Merger Agreement”).

As a result, NavSight Merger Sub merged with and into Old Spire, the separate corporate existence of NavSight Merger Sub ceased, and Old Spire continued as the surviving corporation and a wholly owned subsidiary of NavSight (the “Merger”).

As a result, NavSight Merger Sub merged with and into Legacy Spire, the separate corporate existence of NavSight Merger Sub ceased, and Legacy Spire continued as the surviving corporation and a wholly owned subsidiary of NavSight (the “Merger,”

and such consummation, the “Closing”).

NavSight then changed its name to Spire Global, Inc.

(together with its consolidated subsidiary, “New Spire”

or “Spire”) and Old Spire changed its name to Spire Global Subsidiary, Inc.

Please refer to Note 3 “Reverse Recapitalization”

for further details of the Merger.

In November 2021, the Company acquired exactEarth, a leading provider of global maritime vessel data for ship tracking and maritime situational awareness solutions in Canada for a combination of cash and Spire stock.

Please refer to Note 4 "Business Acquisition" for further details of the acquisition.

or “Spire”) and Legacy Spire changed its name to Spire Global Subsidiary, Inc.

In November 2021, the Company acquired exactEarth, a leading provider of global maritime vessel data for ship tracking and maritime situational awareness solutions in Canada, for a combination of cash and Spire stock (the "Acquisition").

The Acquisition was accounted for as a business combination.

On September 14, 2022, the Company entered into an Equity Distribution Agreement (the “Equity Distribution Agreement”) with Canaccord Genuity LLC, as sales agent (the “Agent”

or “Canaccord”).

In accordance with the terms of the Equity Distribution Agreement, the Company may offer and sell its Class A common stock, having an aggregate offering price of up to $ 85,000 from time to time through the Agent pursuant to a registration statement on Form S-3, which became effective on September 26, 2022.

There had been no sales under the Equity Distribution Agreement as of December 31, 2022.

Summary of Significant Accounting Policies

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The consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and regulations of the U.S.

Securities and Exchange commission.

Securities and Exchange Commission (the "SEC").

The Company’s consolidated financial statements include the accounts of Spire Global, Inc.

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All significant intercompany accounts and transactions have been eliminated in consolidation.

The consolidated financial statements for the year ended December 31, 2021 include the accounts of Spire Global, Inc.

former NavSight) and its wholly-owned subsidiary, Old Spire, following the Reverse Recapitalization as further discussed in Note 3 “Reverse Recapitalization.”

For periods prior to the Merger, the reported share and per share amounts have been retroactively converted by applying the Exchange Ratio with the exception of authorized shares.

Issued and outstanding shares and warrants as disclosed herein have been adjusted reflecting the Exchange Ratio.

All other accompanying financial statements as of December 31, 2020 include only the accounts of Old Spire.

The consolidated financial statements for the years ended December 31, 2022 and 2021 include the accounts of Spire Global, Inc.

former NavSight) and its wholly-owned subsidiary, Legacy Spire, following the reverse recapitalization as further discussed in Note 3 “Reverse Recapitalization.”

For periods prior to the Merger, the reported share and per share amounts have been retroactively converted by applying the Exchange Ratio (as defined in Note 3) with the exception of authorized shares.

Issued and outstanding shares and warrants as disclosed herein have been adjusted to reflect the Exchange Ratio.

Liquidity Risks and Uncertainties

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In August 2021, the Company received net proceeds of approximately $ 236,632 from Private Investment in Public Equity (“PIPE”) investors (the “PIPE Investors”) and the Merger.

The Company held cash and cash equivalents of $ 109,256 , excluding restricted cash, at December 31, 2021.

The Company believes that it will have sufficient working capital to operate for a period of one year from the issuance of the 2021 consolidated financial statements based on the borrowings under the FP Term Loan Agreement (as defined in Note 8) and the funds raised associated with the closing of the Merger (the “Closing”) (Note 3).

The Company held cash and cash equivalents of $ 47,196 , excluding restricted cash of $ 373 , and investment in marketable securities of $ 23,084 as of December 31, 2022.

The Company believes that it will have sufficient working capital to operate for a period of at least one year from the issuance of the December 31, 2022 consolidated financial statements.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

The Company’s assessment of the period of time through which its financial resources will be adequate to support its operations is a forward-looking statement and involves risks and uncertainties.

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The Company may be required to seek additional equity or debt financing.

Future liquidity and cash requirements will depend on numerous factors, including market penetration, the introduction of new products, and potential acquisitions of

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

related businesses or technology.

Future liquidity and cash requirements will depend on numerous factors, including market penetration, the introduction of new products, and potential acquisitions of related businesses or technology.

In the event that additional financing is required from outside sources, the Company may not be able to raise it on acceptable terms or at all.

If the Company is unable to raise additional capital when desired, or if it cannot expand its operations or otherwise capitalize on its business opportunities because it lacks sufficient capital, its business, results of operations, and financial condition would be adversely affected.

COVID-19 Impact

In March 2020, the World Health Organization declared the outbreak of COVID-19 a pandemic, which continues to spread throughout the United States and the world and has resulted in authorities implementing numerous measures to contain the virus, including travel bans and restrictions, quarantines, shelter-in-place orders, and business limitations and shutdowns.

While the Company is unable to accurately predict the full impact that the COVID-19 pandemic will have on its results of operations, financial condition, liquidity and cash flows due to numerous uncertainties, including the duration and severity of the pandemic or any resurgences of the pandemic locally or globally, the Company’s compliance with these measures has impacted its day-to-day operations and could continue to disrupt its business and operations, as well as that of certain of the Company’s customers whose industries are more severely impacted by these measures, for an indefinite period of time.

During the fiscal year ending December 31, 2021, the Company has experienced adverse changes in customer buying behavior that began in March 2020 as a result of the impact of the COVID-19 pandemic, including decreased customer engagement, delayed sales cycles, and deterioration in near-term demand.

In 2021, the Delta and the Omicron variants of COVID-19 have become the dominant strains in numerous countries around the world, including the United States, and is believed to be more contagious than other previously identified COVID-19 strains.

Despite these headwinds, the Company experienced an increase in revenue for fiscal year 2021, as compared to fiscal year 2020.

As a result of the impact of the COVID-19 pandemic, the Company experienced delays and re-work due to third party satellite launch providers schedule shifts, delays and increased expenses in its hiring process, some attrition from adjusting company policies due to the COVID-19 pandemic and additional time and expenses supporting customer contracts.

M acroeconomic, Geopolitical and COVID-19 Impact

Over the past two years, the Company has been impacted by the macroeconomic environment, such as fluctuations in foreign currencies, the COVID-19 pandemic, increasing interest rates and the Russian invasion of Ukraine.

A strong U.S.

dollar relative to the Company's foreign subsidiaries' local functional currency for most of 2022 negatively impacted the Company’s revenue, since approximately one-third of the Company’s sales are transacted in foreign currencies, though it positively impacted the Company’s expenses, since a majority of the Company’s employees reside in countries outside of the United States.

The COVID-19 pandemic has caused existing or potential customers to re-evaluate their decision to purchase the Company's offerings, at times resulting in additional customer discounts, extended payment terms, longer sales cycles, and a few contract cancellations.

The pandemic also led to reduced company-wide travel, resulted in a move to a hybrid work model, created a more difficult hiring process and at times resulted in employee attrition.

Increasing interest rates in 2022 resulted in higher interest expenses, as the Company’s credit facility is based on a floating interest rate.

The Russian invasion of Ukraine and the continued conflict created additional global sanctions, which at times caused scheduling shifts or launch cancellations by third-party satellite launch providers, which has delayed revenue recognition of certain sales contracts.

If any of these factors continue or worsen, and/or if new macroeconomic or geopolitical issues arise, the Company's results and financial condition could be further negatively impacted.

The Company cannot predict the timing, strength, or duration of any economic slowdown, downturn, instability, or recovery, generally or within any particular industry or geography.

Any downturn of the general economy or industries in which the Company operates would adversely affect its business, financial condition, and results of operations.

Segment Information

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Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the dates of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period.

Management’s significant estimates include assumptions in revenue recognition, allowance for credit losses, valuation of certain assets and liabilities acquired from the business combination, realizability of deferred income tax assets, and fair value of equity awards, contingent earnout liabilities and warrant liabilities.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosures of contingent assets and liabilities at the dates of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period.

Management’s significant estimates include assumptions in revenue recognition, allowance for credit losses, valuation of certain assets and liabilities acquired from the Acquisition, realizability of deferred income tax assets, and fair value of equity awards, contingent earnout liabilities and warrant liabilities.

Actual results could differ from those estimates.

Management assessed the impact of COVID-19 on the estimates and assumptions and determined there was no material impact.

Management assessed the impact of COVID-19 on the estimates and assumptions and determined there was no material impact in the reporting periods.

Foreign Currency Translation

The Company’s foreign subsidiaries, which have defined their functional currency as their local currency, translate their assets and liabilities into

The Company’s foreign subsidiaries, which have defined their functional currency as their local currency, translate their assets and liabilities into U.S.

Dollars at the exchange rate existing at the balance sheet date, and translate their results from operations at the average exchange rate for each period.

The resulting translation adjustments are included as a component of Accumulated other comprehensive loss on the Consolidated Balance Sheets, Consolidated Statements of Changes in Stockholders’

Equity (Deficit) and as Other comprehensive loss in the Consolidated Statements of Comprehensive Loss.

Gains and losses from foreign currency transactions are included in Other (expense) income, net in the Consolidated Statements of Operations.

The resulting translation adjustments are included as a component of accumulated other comprehensive loss on the consolidated balance sheets, consolidated statements of changes in stockholders' equity (deficit) and as other comprehensive loss in the consolidated statements of comprehensive loss.

Gains and losses from foreign currency transactions are included in other expense, net in the consolidated statements of operations.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

Fair Value Measurements

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The Company uses the following valuation techniques to measure fair value for its assets and liabilities:

Level 1 Quoted market prices for identical assets and liabilities in active markets.

Level 1 Quoted prices in active markets for identical assets or liabilities.

Level 2 Significant other observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data.

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These valuations require significant judgment.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

Cash, Cash Equivalents and Restricted Cash

Cash, Cash Equivalents, Marketable Securities and Restricted Cash

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.

Restricted cash included in other long-term assets, including restricted cash on the consolidated balance sheets, represents amounts pledged as guarantees or collateral for financing arrangements and lease agreements, as contractually required.

The Company invests in highly rated securities, with the primary objective of minimizing the potential risk of principal loss.

The Company’s investment policy generally requires securities to be investment grade and limits the amount of credit exposure to any one issuer.

The Company’s investments in marketable debt securities have been classified and accounted for as available-for-sale.

The Company classifies its marketable debt securities as either short-term or long-term based on each instrument’s underlying contractual maturity date.

Unrealized gains and losses on marketable debt securities classified as available-for-sale are recognized in accumulated other comprehensive (loss) income.

Interest on securities classified as available-for-sale is included in interest income in the consolidated statements of operations.

The following table shows components of cash, cash equivalents, and restricted cash reported on the consolidated balance sheets and in the consolidated statements of cash flows as of and for the years then ended:

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An allowance for credit losses is recorded based on historical loss experience, consideration of current and future economic conditions, and evaluation of a customer’s current and future financial condition.

Increases and decreases in the allowance for credit losses are included as a component of general and administrative expense in the consolidated statements of income.

Increases and decreases in the allowance for credit losses are included as a component of general and administrative expense in the consolidated statements of operations.

Recoveries of accounts receivable for which an allowance exists, or those that were previously written off, are recorded when received.

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Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash, cash equivalents and restricted cash, and accounts receivable.

Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash, cash equivalents and restricted cash, marketable securities, and accounts receivable.

The Company typically has cash accounts in excess of Federal Deposit Insurance Corporation insurance coverage.

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The Company had the following customers whose revenue and accounts receivable balances individually represented 10% or more of the Company’s total revenue and/or accounts receivable:

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

Year Ended December 31,

* Revenue and/or accounts receivable from these customers were less than 10 % of total revenue and/or accounts receivable during the period.

* Revenue and/or accounts receivable from these customers were less than 10 % of total revenue and/or accounts receivable during the year.

The Company has a concentration in vendor purchases.

The Company believes its reliance on its vendors could be shifted over a period of time to alternative vendors should such a change be necessary.

If the Company were to be unable to obtain alternative vendors due to factors beyond its control, operations would be disrupted in the short term while alternative vendors were secured.

The Company has the following vendors where purchases of equipment, components and services individually represented 10% or more of the Company’s total purchases:

Year Ended December 31,

* Purchases from these vendors were less than 10 % of total purchased during the period.

If the Company were to be unable to obtain alternative vendors due to factors beyond its control, operations would be disrupted until alternative vendors were secured.

The Company did not have any vendors for the year ended December 31, 2022, and one vendor for the year ended December 31, 2021, from which purchases of equipment, components and services individually represented 10% or more of the Company’s total purchases.

The Company is dependent on third parties to launch its satellites into space, and any launch delay, malfunction, or failure could have a negative impact on revenue and might cause the Company not to be able to accommodate customers with sufficient data to meet minimum service level agreements until replacement satellites are available.

The Company also incorporates technology and terrestrial data sets from third parties into its platform and its inability to maintain rights and access to such technology and data sets would harm its business and results of operations.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

Property and Equipment

Property and equipment are stated at cost, less accumulated depreciation and amortization.

In-service satellites and related launch costs are capitalized based on its commission date of the underlying asset.

In-service satellites and related launch costs are capitalized based on the commission date of the underlying asset.

Capitalized launch costs for each satellite are allocated based on the total cost of the launch divided by the number of satellites included on that launch.

In-service ground stations and related costs are capitalized once signals are transmitted with in-service satellites.

In the event of a failed launch or deployment of satellites, the related equipment impairment and launch costs are expensed and recorded in Loss on satellite deorbit and launch failure in the Consolidated Statements of Operations.

In the event of a failed launch or deployment of satellites, the related equipment impairment and launch costs are expensed and recorded in the consolidated statements of operations.

The Company also capitalizes certain software costs incurred in connection with developing internal-use software during the project development stage so long as management with the relevant authority authorizes the project, it is probable the project will be completed, and the software will be used to perform the function intended.

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General maintenance and repairs are charged to expense as incurred.

Significant refurbishment, renewal and betterments are capitalized.

When assets are retired or disposed of, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is reflected as Other income (expense) in the Company’s Consolidated Statements of Operations.

Significant refurbishments, renewals and betterments are capitalized.

When assets are retired or disposed of, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is reflected as other expense, net in the Company’s consolidated statements of operations.

Depreciation and amortization are computed utilizing the straight-line method over the estimated useful lives of depreciable assets in the table below.

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Capitalized satellite launch costs and in-service satellites

As of December 31, 2021 and 2020, 37 % and 74 %, respectively, of the Company’s long-lived assets were located in the U.S., 41 % and none , respectively were located in Canada, and 22 % and 26 %, respectively were located in Europe, Middle East and Africa (collectively, “EMEA”).

Within EMEA, 20 % of the Company’s long-lived assets were located in the UK at December 31, 2021.

Within EMEA, 19 % of the Company’s long-lived assets were located in the UK at December 31, 2020.

As of December 31, 2022 and 2021, 34 % and 37 %, respectively, of the Company’s long-lived assets were located in the U.S., 27 % and 41 %, respectively were located in Canada, and 39 % and 22 %, respectively were located in Europe, the Middle East and Africa (collectively, “EMEA”).

Within EMEA, 30 % and 20 % of the Company’s long-lived assets were located in the UK at December 31, 2022 and 2021, respectively.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

Equity Method Investments

The Company accounts for equity investments in which it has significant influence, but not a controlling financial interest, using the equity method of accounting.

Under the equity method of accounting, investments are initially recorded at cost, less impairment, and subsequently adjusted to recognize the Company’s share of earnings or losses as a component of Other (expense) income, net in the Consolidated Statements of Operations.

Under the equity method of accounting, investments are initially recorded at cost, less impairment, and subsequently adjusted to recognize the Company’s share of earnings or losses as a component of other expense, net in the consolidated statements of operations.

The Company’s equity method investments are required to be reviewed for impairment when it is determined there may be an other-than-temporary loss in value.

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Goodwill is measured as the excess of the consideration transferred over the fair value of assets acquired and liabilities assumed on the acquisition date.

Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred included in the General and administrative expenses in the Consolidated Statements of Operations.

Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred included in the general and administrative expenses line item in the consolidated statements of operations.

The authoritative guidance allows a measurement period of up to one year from the date of acquisition to make adjustments to the preliminary allocation of the purchase price.

As a result, during the measurement period the Company may record adjustments to the fair values of assets acquired and liabilities assumed, with the corresponding offset to goodwill to the extent that it identifies adjustments to the preliminary purchase price allocation.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

Goodwill and Intangible Assets

Goodwill represents the excess of the purchase price over the estimated fair value of net tangible and identifiable intangible assets acquired in business acquisitions.

The Company performs a qualitative assessment on goodwill annually in the fourth quarter or if events or changes in circumstances indicate that the carrying value of goodwill may not be recoverable.

If it is determined in the qualitative assessment that the fair value of the Company's single reportable unit is more likely than not below its carrying amount, then the Company will perform a quantitative impairment test.

The Company first performs a qualitative assessment of goodwill annually in the fourth quarter, and more frequently if events or changes in circumstances indicate that the carrying value of goodwill may not be recoverable.

If it is determined in the qualitative assessment that the fair value of the Company's single reporting unit is more likely than not below its carrying amount, then the Company will perform a quantitative impairment test.

The quantitative goodwill impairment test is performed by comparing the fair value of the reporting unit with its carrying amount.

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For purposes of goodwill impairment testing, the Company has one reporting unit.

Due to the timing of the acquisition of goodwill, this was not applicable for the year ended December 31, 2021.

There were no goodwill impairments recorded during the years ended December 31, 2021 and 2020.

The annual goodwill impairment assessment performed in the fourth quarter of 2022 indicated that the fair value significantly exceeded the carrying value of goodwill.

Intangible assets consist of acquired intangible assets which include customer relationships, developed technology and trade names and the costs to obtain patents and perpetual nonexclusive license rights for the use of intellectual property.

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Intangible assets are tested for impairment whenever there are indicators of impairment.

The Company recognized impairment charges of $ 91 for intangible assets for the year ended December 31, 2021 and no ne for the year ended December 31, 2020.

The Company recognized impairment charges of $ 72 and $ 91 for intangible assets relating to patents for the years ended December 31, 2022 and 2021, respectively.

Impairment of Long-Lived Assets

The Company assesses potential impairments to long-lived and intangible assets whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable.

The Company assesses potential impairments to long-lived assets whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable.

An impairment is considered to exist if the total estimated future cash flows on an undiscounted basis are less than the carrying amount of the assets or asset groups.

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In estimating future cash flows, assets are grouped at the lowest levels for which there are identifiable cash flows that are largely independent of cash flows from other asset groups.

The Company did no t recognize any impairment charges for long-lived assets for the years ended December 31, 2021 and 2020.

The Company recognized impairment charges of $ 549 on decommissioned satellites and $ 143 of other long-lived assets for the year ended December 31, 2022 and no impairment charges for long-lived assets for the year ended December 31, 2021.

Deferred Offering Costs and Merger Costs

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There were no deferred offering costs capitalized as of December 31, 2022 and 2021.

During the year ended December 31, 2021, the Company also incurred $ 6,591 of costs related to the Merger, including $ 4,846 for professional services and $ 1,745 of other merger related costs.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

During the year ended December 31, 2021, the Company incurred $ 6,591 of costs related to the Merger, including $ 4,846 for professional services and $ 1,745 of other merger related costs.

These amounts have been included in general and administrative expenses in the consolidated statements of operations for the year ended December 31, 2021.

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Debt Issuance Costs

For Long-term debt and Convertible notes payable, the Company presents debt issuance costs on the Consolidated Balance Sheets as a direct deduction from their carrying amounts.

Debt issuance costs and the fair value assigned to stock warrants issued related to term loans and convertible notes payable are amortized over the respective term of the debt facility using the effective interest method.

The Company generally classifies warrants for the purchase of shares of its common stock and preferred stock as liabilities on its Consolidated Balance Sheets unless the warrants meet certain specific criteria that require the warrants to be classified within stockholders’

For long-term debt, the Company presents debt issuance costs on the consolidated balance sheets as a direct deduction from the carrying amount of the related debt facility.

Debt issuance costs and the fair value assigned to stock warrants issued related to term loans are amortized over the respective term of the debt facility using the effective interest method.

The Company generally classifies warrants for the purchase of shares of its common stock as liabilities on its consolidated balance sheets unless the warrants meet certain specific criteria that require the warrants to be classified within stockholders’

Those warrants accounted for as liabilities are freestanding financial instruments that may require the Company to transfer assets upon exercise.

The warrant liability is initially recorded at fair value upon the date of issuance of each warrant and is subsequently remeasured to fair value at each reporting date.

Changes in the fair value of the warrant liability are recognized as a component of Other income, net in the Consolidated Statements of Operations.

Changes in the fair value of the warrant liabilities are recognized as a component in other income (expense) in the consolidated statements of operations.

Changes in the fair value of the warrant liabilities will continue to be recognized until the warrants are exercised, expire or qualify for equity classification.

Warrants classified as equity are initially recorded at fair value on the date of issuance and recorded in additional paid-in capital on the Company’s consolidated balance sheets until the warrants are exercised or expire.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

The Company assumed 11,499,992 publicly-traded warrants (“Public Warrants”) and 6,600,000 private placement warrants issued by NavSight (“Private Warrants”

and, together with the Public Warrants, the “Common Stock Warrants”) upon the Merger, all of which were issued in connection with NavSight’s initial public offering and entitled the holder to purchase one share of the Company’s common stock, par value $ 0.0001 (“Common Stock”) at an exercise price of $ 11.50 per share.

and, together with the Public Warrants, the “Common Stock Warrants”) upon the Merger, all of which were issued in connection with NavSight’s initial public offering and entitled holders to purchase one share of the Company's Class A common stock, par value $ 0.0001 (“Common Stock”) at an exercise price of $ 11.50 per share.

The Public Warrants are publicly traded and are exercisable for cash unless certain conditions occur, such as the failure to have an effective registration statement related to the shares issuable upon exercise or redemption by the Company under certain conditions, at which time the warrants may be cashless exercised.

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As the Common Stock Warrants meet the definition of a derivative, the Company recorded these warrants as liabilities on the consolidated balance sheets at fair value (Note 10), with subsequent changes in their respective fair values recognized in the consolidated statements of operations at each reporting date.

On November 16, 2022, the Company commenced a warrant exchange (Note 10), pursuant to which 9,956,489 Public Warrants and 6,600,000 Private Warrants were each exchanged for 0.2 shares of the Company's Class A common stock on December 19, 2022.

On December 19, 2022, the Company also entered into an amendment to the warrant agreement (the “Warrant Amendment”) that provided the Company with the right to require the exchange of the Company’s remaining outstanding Public Warrants for Class A common stock at an exchange ratio of 0.18 shares for each Public Warrant.

The Company exercised its exchange right on December 19, 2022 and the remaining 1,543,493 Public Warrants were exchanged on January 4, 2023.

Contingent Earnout Liability

In connection with the Reverse Recapitalization and pursuant to the Merger Agreement, eligible Spire equity holders are entitled to receive additional shares of the Company’s Common Stock upon the Company achieving certain Earnout Triggering Events (as described in the Merger Agreement and Note 3).

In accordance with ASC 815-40, the earnout shares are not indexed to the Common Stock and therefore are accounted for as a liability and an offset to Additional paid-in capital on the Consolidated Balance Sheets at the reverse recapitalization date and subsequently remeasured at each reporting date with changes in fair value recorded as a component of Other income (expense), net in the Consolidated Statements of Operations.

In connection with the Reverse Recapitalization and pursuant to the Merger Agreement, eligible Spire equity holders are entitled to receive additional shares of the Company's Class A common stock upon the Company achieving certain Earnout Triggering Events (as described in the Merger Agreement and Note 3).

In accordance with Accounting Standards Codification (“ASC”) 815-40, the earnout shares are not indexed to the Company's common stock and therefore were accounted for as a liability and an offset to additional paid-in capital on the consolidated balance sheets at the reverse recapitalization date and subsequently remeasured at each reporting date with changes in fair value recorded as a component of other income (expense) in the consolidated statements of operations.

The contingent earnout liability is categorized as a Level 3 fair value measurement using the Monte Carlo model (Note 10) because the Company estimates projections during the Earnout Period utilizing unobservable inputs.

Contingent earnout payments involve certain assumptions requiring significant judgment and actual results may differ from assumed and estimated amounts.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

Revenue Recognition

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In some data access contracts, the Company provides multiple project-based services to a customer, most commonly when a contract covers multiple phases of the Space Services solution (e.g., development, manufacturing, launch and satellite operations).

In those cases, the Company accounts for each distinct project-based deliverables as a separate performance obligation and allocates the transaction price to each performance obligation based on its relative standalone selling price, which is generally estimated using cost plus a reasonable margin.

In those cases, the Company accounts for each distinct project-based deliverable as a separate performance obligation and allocates the transaction price to each performance obligation based on its relative standalone selling price, which is generally estimated using cost plus a reasonable margin based on value added to the customer.

The Company recognizes revenue when (or as) the performance obligation is satisfied, either over time or at a point in time.

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If customer acceptance is required, revenue is recognized upon receipt of notice of customer acceptance, which is generally a short period of time after delivery.

For certain project-based performance obligations (e.g., manufacturing and launch phases), revenue is recognized over time, using the output method, specifically contract

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

milestones, which we have determined to be the most direct and reasonable measure of progress as they reflect the results achieved and value transferred to the customer.

For certain project-based performance obligations (e.g., manufacturing and launch phases), revenue is recognized over time, using the output method, specifically contract milestones, which we have determined to be the most direct and reasonable measure of progress as they reflect the results achieved and value transferred to the customer.

Contract Assets and Liabilities

For each of the Company’s contracts, the timing of revenue recognition, customer billings, and cash collections determines the recorded accounts receivables, contract assets, and contract liabilities on the Company’s Consolidated Balance Sheets.

For each of the Company’s contracts, the timing of revenue recognition, customer billings, and cash collections determines the recorded accounts receivable, contract assets, and contract liabilities on the Company’s consolidated balance sheets.

Payment terms and conditions generally include a requirement to pay within 30 days.

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Deferred contract costs are included in other current assets, for the current portion, and other long-term assets, for the non-current portion, on the Company’s consolidated balance sheets.

Deferred contract costs at December 31, 2021 and 2020 were $ 1,419 and $ 1,004 , respectively, of which $ 885 and $ 657 were classified as current, respectively.

During the years ended December 31, 2021 and 2020, the Company recognized $ 730 and $ 396 , respectively, as amortization of deferred contract costs in Sales and marketing expense.

Deferred contract costs at December 31, 2022 and 2021 were $ 890 and $ 1,419 , respectively, of which $ 439 and $ 885 , respectively, were classified as current.

During the years ended December 31, 2022 a nd 2021, the Company recognized $ 809 and $ 730 , respectively, as amortization of deferred contract costs in sales and marketing expense.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

Cost of Revenue

Costs directly related to providing project-based services and producing data that is subscribed by the customers, including cost of third-party data sets, and allocated overhead costs, are included in Cost of revenue in the Consolidated Statements of Operations.

Cost of revenue consists primarily of personnel costs, depreciation, hosted infrastructure and high-power computing costs, third-party operating and royalty costs associated with delivering data and services to customers, allocated overhead costs and amortization of purchased intangibles customer relationships and developed technology associated with the Acquisition.

Overhead costs primarily include allocable amounts of utilities, rent, depreciation expense on assets used directly in revenue producing activities, indirect materials, production and test administration expenses, and repairs and maintenance.

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Sales and Marketing

Sales and marketing expenses consist primarily of employee-related expenses, sales commissions, marketing and advertising costs, costs incurred in the development of customer relationships, brand development costs and travel-related expenses.

The Company expenses advertising costs as incurred.

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Plan matching contributions, discretionary profit-sharing contributions, and qualified nonelective contributions may be made to the 401(k) salary deferral plan at the discretion of the Company’s Board of Directors.

The Company did no t make any matching contributions, discretionary profit-sharing contributions and/or qualified nonelective contributions during the years ended December 31, 2021 and 2020.

The Company has defined contribution pension plans at its foreign subsidiaries which covers all employees who meet certain eligibility requirements.

The contributions made by the Company under these plans during the years ended December 31, 2021 and 2020 were not material.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

The Company did no t make any matching contributions, discretio nary profit-sharing contributions and/or qualified nonelective contributions during the years ended December 31, 2022 and 2021.

The Company has defined contribution pension plans at its foreign subsidiaries which cover all employees who meet certain eligibility requirements.

The contributions made by the Company under these plans during the years ended December 31, 2022 and 2021 were $ 737 and $ 506 , respectively.

Stock-Based Compensation

The Company has an equity incentive plan under which the Company grants stock-based awards to employees and non-employees.

The Company accounts for stock-based awards in accordance with FASB Accounting Standards Codification (“ASC”) 718, Stock-Based Compensation , which requires the measurement and recognition of compensation expense, based on estimated fair values, for all stock-based awards made to employees and non-employees for stock options.

Restricted Stock Units ("RSU") with service-based vesting conditions, the fair value is calculated based upon the Company’s closing stock price on the date of grant using the intrinsic value method.

The Company accounts for stock-based awards in accordance with ASC 718, Stock-Based Compensation , which requires the measurement and recognition of compensation expense, based on estimated fair values, for all stock-based awards made to employees and non-employees.

For stock options, the fair value is calculated using the Black-Scholes option pricing model.

The Black-Scholes option pricing model requires the input of assumptions, including the fair value of the underlying common stock, the expected term of the option, the expected volatility of the price of the Company’s common stock, risk-free interest rates, and the expected dividend yield of the Company’s common stock.

For restricted stock units ("RSU") with service-based vesting conditions, the fair value is calculated based upon the Company’s closing stock price on the date of grant using the intrinsic value method.

Stock-based compensation expense is recognized on a straight-line basis over the requisite service period and forfeitures are accounted for as they occur.

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The Company bases its interest rate on a treasury instrument for which the term is consistent with the expected life of the stock options.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

The Company was incorporated in the state of Delaware as a C corporation.

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The Company recognizes interest accrued related to unrecognized tax benefits in interest expense and penalties, if any, in general and administrative expenses in the accompanying consolidated statements of operations.

Beginning in 2022, the Tax Cuts and Jobs Act (the "Tax Act") requires taxpayers to capitalize research and development expenses with amortization periods over five and fifteen years, which reduced the Company’s taxable loss, and created a new deferred tax asset for capitalized research and development costs, and corresponding adjustments to tax on foreign source income through global intangible low-taxed income ("GILTI"), all of which have been accounted for in determining the Company’s tax provision or benefit.

The Company reports income taxes in accordance with Financial Accounting Standards Board ("FASB") ASC 740, Income Taxes, which requires an asset and liability approach in accounting for income taxes.

Deferred 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, as well as net operating loss and tax credit carryforwards.

Deferred tax amounts are determined by using the enacted tax rates expected to be in effect when the temporary differences are expected to be recovered or settled.

The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

A valuation allowance reduces the deferred tax assets to the amount that is more likely than not to be realized.

Related Parties

In November 2021, in conjunction with the acquisition of exactEarth, Myriota, a Spire customer, became a related party, as exactEarth has 14 % ownership of Myriota.

As of December 31, 2021, $ 4,101 of investment in Myriota is included in Other long-term assets, including restricted cash on the Consolidated Balance Sheets.

The Company generated $ 408 in revenue during the year ended December 31, 2021 and $ 170 accounts receivable as of December 31, 2021 from Myriota.

One of the Company’s stockholders and debtors is also a customer from which the Company generated $ 871 of revenue for the year ended December 31, 2020.

No revenue was generated from this customer for the year ended December 31, 2021.

The Company borrowed gross proceeds of $ 1,232 of Convertible notes payable in February 2021 and $ 6,414 of Convertible notes payable during the year ended December 31, 2019, from certain stockholders (Note 9).

Interest expense recognized on related party Convertible notes payable is $ 413 and $ 783 for the years ended December 31, 2021 and 2020, respectively.

Immediately prior to the effective time of the Merger, the Convertible Notes were automatically converted into shares of common stock of Old Spire (“Old Spire Common Stock”) (Note 3 and Note 9).

Total carrying value of the related party balance included as Convertible notes payable, net on the Consolidated Balance Sheets was $ 0 and $ 7,498 as of December 31, 2021 and 2020, respectively.

As a result of the Acquisition in November 2021, Spire's customer, Myriota Pty Ltd ("Myriota"), became a related party, as exactEarth has a 14 % ownership stake in Myriota.

As of December 31, 2022, the Company's investment in Myriota, in the amount of $ 3,296 , was included in other long-term assets on the consolidated balance sheets.

The Company accounts for this investment using the equity method of accounting.

The Company's share of earnings or losses on the investment is recorded based on a one-month lag, due to the timing of receipt of financial statements from Myriota, as a component of other (expense) income, net in the consolidated statements of operations.

The Company generated $ 2,278 and $ 408 in revenue during the years ended December 31, 2022 and 2021, respectively, and had $ 170 and $ 170 accounts receivable as of December 31, 2022 and 2021, respectively, from Myriota.

The Company borrowed gross proceeds of $ 1,232 of Convertible Notes (defined in Note 8) payable in February 2021 and $ 6,414 of Convertible Notes payable during the year ended December 31, 2019, from certain stockholders (Note 8).

Immediately prior to the effective time of the Merger, the Convertible Notes were automatically converted into shares of common stock of Legacy Spire (“Legacy Spire Common Stock”) (Note 3 and Note 8).

Interest expense recognized on the related party Convertible Notes payable was $ 413 for the year ended December 31, 2021.

No interest expense was recognized on the related party Convertible Notes payable for the year ended December 31, 2022.

Comprehensive Loss

Comprehensive loss is comprised of Net loss and Other comprehensive loss consisting of Foreign currency translation adjustments.

Comprehensive loss is comprised of net loss and other comprehensive loss consisting of foreign currency translation adjustments and net unrealized loss on investments.

Net Loss Per Share

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The Company has two types of common stock, Class A and Class B.

Class B common stock has no economic rights, therefore has been excluded from the computation of basic and diluted net loss per share.

The two-class method determines net income (loss) per share for each class of

Class B common stock has no economic rights, and therefore has been excluded from the computation of basic and diluted net loss per share.

The two-class method determines net income (loss) per share for each class of common and participating securities according to dividends declared, if any, and participating rights in undistributed earnings.

The two-class method requires income available to common stockholders for the period to be allocated between common and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed.

Basic net income (loss) per share is computed by dividing the net income (loss) by the weighted-average number of common shares

Spire Global, Inc.

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(In thousands, except shares and per share data, unless otherwise noted)

common and participating securities according to dividends declared, if any, and participating rights in undistributed earnings.

The Company’s convertible preferred stock contractually entitles the holders of such shares to participate in dividends but does not contractually require the holders of such shares to participate in losses of the Company.

Accordingly, in periods in which the Company reports a net loss, such losses are not allocated to participating securities.

In such periods, diluted net loss per share is the same as basic net loss per share, since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive.

Upon the Closing Date of the merger, the preferred stock two-class method is no longer applicable.

Basic net income (loss) per share is computed by dividing the net income (loss) by the weighted-average number of common shares outstanding during the period.

outstanding during the period.

Diluted net income (loss) is computed by adjusting net income (loss) to reallocate undistributed earnings based on the potential impact of dilutive securities.

Diluted net income (loss) per share is computed by dividing the diluted net income (loss) by the weighted-average number of common shares outstanding during the period, including potential dilutive common shares assuming the dilutive effect of common stock equivalents.

Prior Period Reclassifications

Certain amounts in prior periods have been reclassified to conform with current period presentation.

JOBS Act Accounting Election

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Accounting Pronouncements Recently Adopted

In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments—Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments, as amended (“ASU 2016-13”), which requires the measurement and recognition of expected credit losses for financial assets not held at fair value.

ASU 2016-13 replaces the existing incurred loss impairment model with a forward-looking expected credit loss model which will result in earlier recognition of credit losses.

The Company adopted the requirements of ASU 2016-13 effective January 1, 2021 and determined that the financial impact from the adoption of this standard was immaterial to its consolidated financial statements.

In August 2018, the FASB issued ASU 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 (A Consensus of the FASB Emerging Issues Task Force) (“ASU 2018-15”), which aligns the requirements for capitalizing implementation costs incurred in a cloud computing hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal use software.

The Company adopted the requirements of ASU 2018-15 effective January 1, 2021 and determined that the financial impact from the adoption of this standard was immaterial to its consolidated financial statements.

In March 2020 and January 2021, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848):

Facilitation of the Effects of Reference Rate Reform on Financial Reporting, and ASU 2021-01, Reference Rate Reform (Topic 848), respectively, which refine the scope of ASC Topic 848 and clarify some of its guidance as part of the FASB’s monitoring of global reference rate reform activities.

These standards permit entities to elect certain optional expedients and exceptions when accounting for derivative contracts and certain hedging relationships affected by changes in the interest rates used for discounting cash flows, for computing variation margin settlements, and for calculating price alignment interest in connection with reference rate reform activities under way in global financial markets.

The amendments in ASU 2020-04 were effective for all entities as of March 12, 2020 through December 31, 2022 and the amendments in ASU 2021-01 are effective immediately for all entities.

The Company determined that the financial impact from the adoption of these standards was immaterial to its consolidated financial statements.

Accounting Pronouncements Not Yet Adopted

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors).

Since this standard was originally issued, there have been improvements and clarification released by the FASB.

Under the new standard, a lessee should recognize in the statement of financial position a liability to make lease payments and a right-of-use asset representing its right to use the underlying asset for the lease term.

This standard is effective for fiscal years beginning after December 15, 2021, with early adoption permitted.

The Company will adopt the new standard on January 1, 2022 using a modified retrospective approach with a cumulative-effect adjustment to opening retained earnings.

Therefore, upon adoption, the Company will not adjust its comparative period financial statements or disclose ASC 842 lease disclosures for periods before January 1, 2022.

The Company has evaluated the available accounting policy elections and practical expedients permitted by the standard and will adopt the package of practical expedients to not reassess prior conclusions related to contracts containing leases, lease classification and initial direct costs.

While the Company is still finalizing its evaluation of the impact of the new lease accounting guidance, the Company expects a material impact to the consolidated financial statements as a result of the recognition of right-of-use assets and leases liabilities.

In addition, the Company does not expect the standard to have a material impact on the Company's liquidity or debt covenant compliance under its current agreement.

The new standard also provides practical expedients for a company's ongoing accounting.

The Company will elect the short-term lease recognition exemption for all leases that qualify.

This means, for those leases that qualify, the Company will not recognize ROU assets or lease liabilities including

In February 2016, FASB issued Accounting Standards Update ("ASU") No.

2016-02, Leases ("ASC 842"), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors).

Since this standard was originally issued, there have been improvements and clarifications released by the FASB.

Under the new guidance, at the commencement date, lessees are required to recognize a lease liability with a corresponding right-of-use ("ROU") asset.

On January 1, 2022, the Company adopted ASC 842 using the modified retrospective approach with the effective date as of the date of initial application.

Consequently, results for the year ended December 31, 2022 are presented under ASC 842.

Prior period amounts were not adjusted and continue to be reported in accordance with previous lease guidance under ASC Topic 840, Leases .

The Company elected the following practical expedients as permitted per the guidance:

The "package of practical expedients" which permits the Company not to reassess under the new standard its prior conclusions about lease identification, lease classification and initial direct costs.

The Company has elected this package of practical expedients in its entirety.

The short-term lease recognition exemption for all leases that qualify.

This means, for those leases that qualify, the Company will not recognize ROU assets or lease liabilities for existing short-term leases of assets in transition.

The practical expedient to not separate lease and non-lease components for all of the Company's leases.

Adoption of ASC 842 resulted in the recording of $ 11,775 in ROU assets and $ 12,611 in lease liabilities, as of January 1, 2022.

The difference between the ROU assets and lease liabilities is driven primarily by lease incentives and deferred rent balances that were reclassified from liabilities, presented in other accrued expenses for the current portion and other long-term liabilities for the long-term portion, to the ROU asset balance, presented in operating lease assets.

The standard did not materially impact retained earnings, consolidated net loss, and the statements of cash flows.

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes , by removing certain exceptions to the general principles which is intended to improve consistent application.

A franchise tax that is partially based on income will be recognized as an income-based tax and any incremental amount will be recognized as non-income-based tax.

This standard was effective for fiscal years beginning after December 15, 2021 (January 1, 2022 for the Company), with early adoption permitted.

The adoption of ASU 2019-12 as of January 1, 2022 did not materially impact the Company's consolidated financial statements.

In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832) , guidance on modifying the disclosure requirements to increase the transparency of government assistance including disclosure of the types of assistance, an entity's accounting for the assistance and the effect of the assistance on an entity's financial statements.

The amendments in this update are effective for financial statements issued for annual periods beginning after December 15, 2021 and should be applied either prospectively or retrospectively.

The adoption of ASU 2021-10 as of December 31, 2022 did not have a material impact on Company’s consolidated financial statements.

Spire Global, Inc.

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(In thousands, except shares and per share data, unless otherwise noted)

for existing short-term leases of assets in transition.

The Company also currently expects to elect the practical expedient to not separate lease and non-lease components for all its leases.

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes, by removing certain exceptions to the general principles and its intended to improve consistent application.

A franchise tax that is partially based on income will be recognized as an income-based tax and any incremental amount will be recognized as non-income-based tax.

This standard is effective for fiscal years beginning after December 15, 2021 (January 1, 2022 for the Company), with early adoption permitted.

The Company does not expect the standard to have a material impact on the Company's Consolidated Financial Statements.

Accounting Pronouncements Not Yet Adopted

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805) , Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, to improve the accounting for acquired revenue contracts with customers in a business combination by addressing diversity in practice and inconsistency related to recognition of an acquired contract liability and payment terms and their effect on subsequent revenue recognized by the acquirer.

The guidance is effective for annual reporting periods beginning after December 15, 2022, including interim periods within that reporting period and should be applied prospectively to business combinations occurring on or after the effective date of the amendments.

The Company did not early adopt for the most recent acquisition of exactEarth.

In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832), guidance on modifying the disclosure requirements to increase the transparency of government assistance including disclosure of the types of assistance, an entity's accounting for the assistance and the effect of the assistance on an entity's financial statements.

The Company did not early adopt for the Acquisition.

In September 2022, the FASB issued ASU 2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50), guidance on modifying the disclosure requirements to enhance the transparency of supplier finance programs including disclosure of the key terms of the program, the amount outstanding that remains unpaid by the buyer as of the end of the annual period, a description of where those obligations are presented in the balance sheet, and a roll forward of those obligations during the annual period.

The amendments in this update are effective for financial statements issued for annual periods beginning after December 15, 2022.

The Company does not expect this accounting standard update to have a material impact on its consolidated financial statements.

Reverse Capitalization

The Company does not expect this ASU to have a material impact on its consolidated financial statements.

Reverse Recapitalization

On August 16, 2021, Spire Global Subsidiary, Inc., merged with NavSight.

As a result of the Merger, NavSight changed its name to Spire Global, Inc.

and Legacy Spire changed its name to Spire Global Subsidiary, Inc.

Immediately prior to the Closing:

All 12,671,911 outstanding shares of Old Spire Series A Convertible Preferred Stock were converted into an equivalent number of shares of Old Spire Common Stock on a one-to-one basis .

All 4,869,754 outstanding shares of Old Spire Series B Convertible Preferred Stock were converted into an equivalent number of shares of Old Spire Common Stock on a one-to-one basis

All 7,592,402 outstanding shares of Old Spire Series C Convertible Preferred Stock were converted into an equivalent number of shares of Old Spire Common Stock on a one-to-one basis

Each of the Convertible Notes (as defined in Note 9) automatically converted into shares of Old Spire Common Stock.

All 12,671,911 outstanding shares of Legacy Spire Series A Convertible Preferred Stock were converted into an equivalent number of shares of Legacy Spire Common Stock on a one-to-one basis .

All 4,869,754 outstanding shares of Legacy Spire Series B Convertible Preferred Stock were converted into an equivalent number of shares of Legacy Spire Common Stock on a one-to-one basis

All 7,592,402 outstanding shares of Legacy Spire Series C Convertible Preferred Stock were converted into an equivalent number of shares of Legacy Spire Common Stock on a one-to-one basis

Each of the Convertible Notes automatically converted into shares of Legacy Spire Common Stock.

The conversion ratio for the 2019 and 2020 Convertible Notes was 2.4808 and the conversion ratio for the 2021 Convertible Notes was 13.6466 .

Old Spire Warrants (with the exception of warrants for 909,798 shares issued to European Investment Bank (“EIB,”

and such warrants, the “EIB Warrants”)) were exercised in full on a cashless basis into the right to receive shares of Old Spire Common Stock, which was settled on a net-basis.

Legacy Spire Warrants (with the exception of warrants for 909,798 shares issued to European Investment Bank (“EIB,”

and such warrants, the “EIB Warrants”)) were exercised in full on a cashless basis into the right to receive shares of Legacy Spire Common Stock, which was settled on a net-basis.

The EIB Warrants were settled as of December 31, 2021 (Note 8).

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Each share of outstanding Class A common stock and Class B common stock of NavSight was exchanged for one share of Class A common stock of New Spire, par value $ 0.0001 per share (“New Spire Class A common stock”).

Each share of Old Spire Common Stock, including shares of Old Spire Common Stock issued pursuant to the conversion of the Old Spire Preferred Stock, the Convertible Notes and the Old Spire Warrants (excluding the EIB warrants), was converted into a number of shares of New Spire Class A Common Stock equal to the Per Share Closing Consideration (“the exchange ratio”) of 1.7058 , as defined in the Merger Agreement.

Each share of Old Spire Common Stock is entitled to the contingent earnout right to receive a number of shares of New Spire Class A Common Stock equal to a Per Share Earnout Consideration of 0.1236 , as defined in the Merger Agreement, payable in four equal tranches if the trading price of the New Spire Class A Common Stock is greater than or equal to $ 13.00 , $ 16.00 , $ 19.00 , or $ 22.00 for any 20 trading days within any 30 consecutive trading day period on or prior to the date that is five years following the Closing Date, as adjusted based on the formula defined in the Merger Agreement with respect to the portion of earnout value allocated to holders of options to purchase shares of Old Spire Common Stock (“Old Spire Options”) assumed by NavSight.

All outstanding Old Spire Options were assumed and converted into option awards that are exercisable for shares of New Spire Class A Common Stock pursuant to an option exchange ratio of 1.8282 .

Each share of Legacy Spire Common Stock, including shares of Legacy Spire Common Stock issued pursuant to the conversion of the Legacy Spire Preferred Stock, the Convertible Notes and the Legacy Spire Warrants (excluding the EIB warrants), was converted into a number of shares of New Spire Class A common stock equal to the Per Share Closing Consideration (“the exchange ratio”) of 1.7058 , as defined in the Merger Agreement.

Each share of Legacy Spire Common Stock is entitled to the contingent earnout right to receive a number of shares of New Spire Class A common stock equal to a Per Share Earnout Consideration of 0.1236 , as defined in the Merger Agreement, payable in four equal tranches if the trading price of the New Spire Class A common stock is greater than or equal to $ 13.00 , $ 16.00 , $ 19.00 , or $ 22.00 for any 20 trading days within any 30 consecutive trading day period on or prior to the date that is five years following the Closing Date, as adjusted based on the formula defined in the Merger Agreement with respect to the portion of earnout value allocated to holders of options to purchase shares of Legacy Spire Common Stock (“Legacy Spire Options”) assumed by NavSight.

All outstanding Legacy Spire Options were assumed and converted into option awards that are exercisable for shares of New Spire Class A common stock pursuant to an option exchange ratio of 1.8282 .

The outstanding EIB Warrants were assumed by New Spire and converted into warrants that are exercisable for a number of shares of New Spire Class A common stock equal to the exchange ratio of 1.7058 .

The Old Spire Founders purchased 12,058,614 shares of New Spire Class B Common Stock, which equal the number of shares of New Spire Class A Common Stock that each Founder received at the Closing.

The Legacy Spire Founders purchased 12,058,614 shares of New Spire Class B Common Stock, which equal the number of shares of New Spire Class A common stock that each Founder received at the Closing.

Shares of New Spire Class B Common Stock carry nine votes per share, do not have dividend rights, are entitled to receive a maximum of $ 0.0001 per share of New Spire Class B Common Stock upon liquidation, are subject to certain additional restrictions on transfer, and are subject to forfeiture in certain circumstances.

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Number of Shares

Old Spire Common Stock (excluding Founders)

Old Spire Convertible Preferred Stock

Old Spire Convertible Notes

Old Spire Warrants (excluding EIB warrants)

Total Class A common shares to Old Spire stockholders (excluding Founders)

New Spire Class A Common Stock issued to Old Spire Founders

Legacy Spire Common Stock (excluding Founders)

Legacy Spire Convertible Preferred Stock

Legacy Spire Convertible Notes

Legacy Spire Warrants (excluding EIB warrants)

Total Class A common shares to Legacy Spire stockholders (excluding Founders)

New Spire Class A common stock issued to Legacy Spire Founders

New Spire Class A common stock issued to PIPE Investors

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Total Shares of New Spire Class A Common Stock

New Spire Class B Common Stock issued to Old Spire Founders

New Spire Class B common stock issued to Legacy Spire Founders

Total Shares of New Spire Common Stock

The Merger is accounted for as a reverse recapitalization under GAAP.

This determination is primarily based on Old Spire stockholders comprising a relative majority of the voting power of New Spire and having the ability to nominate the members of the board of directors of New Spire, Old Spire’s operations prior to the acquisition comprising the only ongoing operations of New Spire, and Old Spire’s senior management comprising a majority of the senior management of New Spire.

This determination is primarily based on Legacy Spire stockholders comprising a relative majority of the voting power of New Spire and having the ability to nominate the members of the board of directors of New Spire, Legacy Spire’s operations prior to the acquisition comprising the only ongoing operations of New Spire, and Legacy Spire’s senior management comprising a majority of the senior management of New Spire.

Under this method of accounting, NavSight is treated as the “acquired”

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Accordingly, for accounting purposes, the financial statements of Spire Global, Inc.

represent a continuation of the financial statements of Old Spire with the Merger being treated as the equivalent of Old Spire issuing stock for the net assets of NavSight, accompanied by a recapitalization.

represent a continuation of the financial statements of Legacy Spire with the Merger being treated as the equivalent of Legacy Spire issuing stock for the net assets of NavSight, accompanied by a recapitalization.

The net assets of NavSight are stated at historical costs, with no goodwill or other intangible assets recorded.

Operations prior to the Merger are presented as those of Old Spire.

Operations prior to the Merger are presented as those of Legacy Spire.

All periods prior to the Merger have been retrospectively adjusted using the exchange ratio for the equivalent number of shares outstanding immediately after the Merger to affect the reverse recapitalization.

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Business Acquisition

On November 30, 2021, through the execution of a share purchase agreement, the Company acquired 100 % of the voting equity interest of exactEarth for a purchase price of $ 128,953 , and was accounted for as a business combination.

On November 30, 2021, through the execution of a share purchase agreement, the Company acquired 100 % of the voting equity interests of exactEarth for a purchase price of $ 128,953 , accounted for as a business combination.

The acquisition of exactEarth accelerates growth of Spire’s existing maritime business with additional data solutions, cross-selling opportunities, and expansion of the Company’s geographic footprint.

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In 2021, the Company incurred $ 4,733 of acquisition-related costs.

These expenses are included in General and administrative expense on the Consolidated Statement of Operations for the year ended December 31, 2021 and are reflected in pro forma earnings for the year ende d December 31, 2020, in the table below.

These expenses are included in general and administrative expense in the consolidated statements of operations for the year ended December 31, 2021.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

The purchase price components are summarized in the following table:

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Total purchase consideration

(1) Represents the fair value of 5,230,167 shares of Spire Class A common share transferred as of the November 30, 2021 ("acquisition date") as consideration (based on the closing market price of $ 4.27 per share on the acquisition date) consisting of 4,984,225 shares issued for outstanding exactEarth shares, in addition to 100,047 and 145,895 shares to settle exactEarth stock options and restricted stock units ("RSU"), respectively .

(2) Included in the cash consideration are:

$ 97,454 for outstanding exactEarth shares,

$ 8,888 cash settlement of exactEarth stock options, RSU and deferred stock units, and

$ 8,888 cash settlement of exactEarth stock options, RSUs and deferred stock units, and

$ 3,250 related to acquisition fees of exactEarth paid by Spire upon the closing of the acquisition.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

(3) $ 2,972 was treated as post-combination expense in connection with the replacement of exactEarth’s outstanding equity awards.

This amount has been reflected in the Consolidated Statement of Operations for the year ended December 31, 2021.

This amount has been reflected in the consolidated statements of operations for the year ended December 31, 2021.

Purchase Price Allocation

The purchase price was allocated to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date, with the excess recorded to goodwill.

The recognition of goodwill, none of which is expected to be deductible for income tax purposes, was made attributable to the workforce of the acquired business on synergies expected to arise and strategic benefits the Company expects to realize from the acquisition.

The allocation of the purchase price has not been finalized, mainly due to the period of time between the acquisition of exactEarth and the date of this filing, and is based upon the best available information at the current time.

The final determination of the fair values of the customer relationships, other intangible assets and investment in Myriota acquired is dependent upon certain valuation and other studies that have not yet been finalized, and will be completed as soon as practicable, but no later than one year after the consummation of the acquisition of exactEarth.

The following table summarizes the preliminary estimated acquisition date fair value of the exactEarth assets acquired and liabilities assumed:

The recognition of goodwill, none of which is deductible for income tax purposes, was made attributable to the workforce of the acquired business on synergies expected to arise and strategic benefits the Company expects to realize from the acquisition.

The following table summarizes the acquisition date fair value allocation of the exactEarth assets acquired and liabilities assumed:

Cash and cash equivalents

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The Company applied the relief-from-royalty method to estimate the fair values of the developed technology and trade names, and the multi-period excess earnings method to estimate the fair values of the customer relationships and backlog for the acquired intangible assets.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

Unaudited Pro Forma Financial Information

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The unaudited pro forma results include adjustments primarily related to the following:

(i) amortization associated with preliminary estimates for the acquired intangible assets;

(i) amortization associated with estimates for the acquired intangible assets;

(ii) depreciation of the property plant and equipment step-up in fair value (iii) expense relating to replacement awards;

and (iv) the inclusion of acquisition costs as of the earliest period presented.

The nonrecurring adjustments of $ 4,733 related to acquisition costs incurred and $ 2,972 related to replacement awards have been included in the pro forma income statement for the year ended December 31, 2020.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

The unaudited pro forma results do not reflect any cost saving synergies from operating efficiencies or the effect of the incremental costs incurred from integrating exactEarth.

Accordingly, these unaudited pro forma results are presented for informational purposes only and are not necessarily indicative of what the actual results of operations of the combined company would have been if the acquisitions had occurred at the beginning of the period presented, nor are they indicative of future results of operations:

Revenues and losses attributable to the acquired business since the date of the acquisition recognized within the Consolidate Statement of Operations for the year ended December 31, 2021 were $ 1,479 and $ 1,470 , respectively.

December 31, 2021

Revenues and losses attributable to the acquired business recognized within the consolidated statements of operations between the date of the acquisition and December 31, 2021 were $ 1,479 and $ 1,470 , respectively.

Revenue, Contract Assets, Contract Liabilities and Remaining Performance Obligations Disaggregation of Revenue

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Revenue from non-subscription-based contracts was $ 23,186 and represented 29 % of total revenue for the year ended December 31, 2022.

Revenue from non-subscription-based contracts was $ 20,813 , representing 73 % of total revenue for the year ended December 31, 2020.

Revenue from non-subscription-based contracts was $ 21,909 , representing 51 % of total r evenue for the year ended December 31, 2021.

The following revenue disaggregated by geography was recognized:

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Asia Pacific (3)

(1) Netherlands represented 24 % and 37 % for the years ended December 31, 2021 and 2020, respectively.

represented 36 % and 38 % for the years ended December 31 2021 and 2020, respectively.

(3) Australia represented 11 % and 9 % for the years ended December 31, 2021 and 2020, respectively.

(1) Netherlands represented 24 % for the year ended December 31, 2021.

represented 35 % and 36 % for the years ended December 31, 2022 and 2021, respectively, and Canada represented 10 % for the year ended December 31, 2022.

(3) Australia represented 11 % for the year ended December 31, 2021.

Contract Assets

The increase in contract assets is due to the acquisition of exactEarth.

At December 31, 2022 and 2021, contract assets were $ 3,353 and $ 2,084 , respectively, on the consolidated balance sheets.

The increase in contract assets was primarily due to the increase in revenue.

Changes in contract assets were as follows:

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Contract Liabilities

At December 31, 2021, Contract liabilities were $ 9,255 of which $ 8,627 is reported in current portion of Contract liabilities and $ 628 is reported in non-current potion in Other long-term liabilities on the Company’s Consolidated Balance Sheets.

At December 31, 2020, Contract liabilities were $ 8,110 and is reported in current portion of Contract liabilities on the Consolidated Balance Sheets.

At December 31, 2022, contract liabilities were $ 16,628 of which $ 15,856 was reported in contract liabilities, current portion, and $ 772 was reported in other long-term liabilities on the Company’s consolidated balance sheets.

At December 31, 2021, contract liabilities were $ 9,255 , of which $ 8,627 was reported in contract liabilities, current portion, and $ 628 was reported in other long-term liabilities on the Company’s consolidated balance sheets.

The increase in contract liabilities was primarily due to the increase in revenue.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

Changes in contract liabilities were as follows:

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Balance at the end of the year

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

Remaining Performance Obligations

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These commitments for future services exclude (i) contracts with an original term of one year or less, and (ii) cancellable contracts.

As of December 31, 2021, the amount not yet recognized as revenue from these commitments is $ 83,171 .

As of December 31, 2022, the amount not yet recognized as revenue from these commitments was $ 167,164 .

The Company expects to recognize 39 % of these future commitments over the next 12 months and the remaining 61 % thereafter as revenue when the performance obligations are met.

Other Balance Sheet Components

Other current assets, including restricted cash consisted of the following:

Other current assets consisted of the following:

Technology and other prepaid contracts

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Other current assets

Other accrued expenses consisted of the following:

Professional services

Satellite/launch/ground station material

Property and equipment, net consisted of the following:

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Property and equipment, net

Depreciation and amortization expense related to property and equipment for the years ended December 31, 2021 and 2020, was $ 8,509 and $ 5,330 , respectively, including amortization of internal-use software of $ 34 and $ 144 , respectively.

There were no costs incurred from failed launches and losses from satellite deorbit and other equipment failure during the year ended December 31, 2021 and $ 666 for the year ended December 31, 2020.

Costs related to failed launches are not capitalized and are included in Loss on satellite deorbit and launch failure in the Consolidated Statements of Operations.

Depreciation and amortization expense related to property and equipment for the years ended December 31, 2022 and 2021, was $ 11,771 and $ 8,509 , respectively.

For the year ended December 31, 2022 there was a $ 549 loss from decommissioned satellites.

Other accrued expenses consisted of the following:

Professional services

Operating lease liabilities, current

Third-party operating costs

Corporate and sales tax

Accrued interest

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

Goodwill and Intangible Assets

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Balance at December 31, 2021

Goodwill related to exactEarth acquisition

Impact of foreign currency translation

Balance at December 31, 2022

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

Intangible assets consisted of the following:

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Accumulated amortization

In conjunction with the exactEarth acquisition, the Company acquired intangible assets for a total of $ 43,621 in November 2021.

As of December 31, 2021, the weighted-average amortization period for Customer relationships and Developed technology was 11.9 years, Trade names was 4.9 years, Backlog was 0.9 years and patents and FCC licenses was 7.6 years.

Amortization expense related to intangible assets for the years ended December 31, 2021 and 2020, was $ 666 and $ 81 , respectively.

During the year ended December 31, 2021, the Company recognized im pairment charges of $ 91 for intangible assets relating to patent costs.

No impairment charges were recognized for the year ended December 31, 2020.

As part of the Acquisition, the Company acquired intangible assets for a total of $ 43,621 in November 2021.

As of December 31, 2022, the weighted-average amortization period for customer relationships and developed technology was 10.9 years, trade names was 3.9 years, and patents and FCC licenses was 7.0 years.

Amortization expense related to intangible assets for the years ended December 31, 2022 and 2021, was $ 6,570 an d $ 666 , respectively.

During the years ended December 31, 2022 and 2021, the Company recognized im pairment charges o f $ 72 and $ 91 , respectively, for intangible assets relating to patent costs which are included in other expense, net in the consolidated statements of operations.

The patents asset balance as of December 31, 2022 and 2021 includes $ 57 and $ 196 of capitalized patent costs, respectively, that will begin amortization upon the issuance of an official patent right to the Company.

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Years ending December 31,

2027 and thereafter

Capitalized patent costs, unissued

Long-Term Debt

Long-Term Debt and Convertible Notes

Long-term debt consisted of the following:

Eastward Loan Facility

EIB Loan Facility

Blue Torch term loan

Total long-term debt

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Non-current portion of long-term debt

The Company recorded $ 8,368 and $ 1,406 of interest expense from long-term debt for the years ended December 31, 2021 and 2020, respectively.

In April 2020, the Company received loan proceeds in the amount of $ 1,709 under the Paycheck Protection Program (“PPP”).

The PPP, established as part of the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act, provides for loans to qualifying businesses for amounts up to 2.5 times the average monthly payroll expenses of the qualifying business.

The loan under the PPP was in the form of a note payable to SVB (the “PPP Loan”) originally scheduled to mature in April 2022, which has been classified as Long-term debt on the Consolidated Balance Sheet at December 31, 2020.

The PPP Loan incurred interest at a rate of 1.00 % per annum payable monthly.

The PPP Loan and accrued interest are forgivable as long as the borrower uses the loan proceeds for eligible purposes.

The Company’s PPP Loan and accrued interest were forgiven in January 2021.

The Company recorded $ 13,955 and $ 8,368 of interest expense which included amortization of deferred issuance costs of $ 3,781 and $ 3,471 from long-term debt for the years ended December 31, 2022 and 2021, respectively.

Spire Global, Inc.

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(In thousands, except shares and per share data, unless otherwise noted)

EIB Loan Facility

In August 2020, the Company’s Luxembourg subsidiary entered into a loan agreement with the European Investment Bank (“EIB”) that provided for a total loan facility of EUR 20,000 distributable in three tranches (the “EIB Loan Facility”) and was collateralized by substantially all assets of the Company.

In connection with the EIB debt agreement, on August 20, 2020, the Company issued to EIB 454,899 warrants exercisable into the Company’s common stock at a price of $ 0.0001 per share (Note 13) and drew EUR 5,000 under the Tranche A of the EIB Loan Facility on September 23, 2020.

Borrowing under Tranche A did not carry an interest component.

On October 29, 2020, the Company issued an additional 454,899 warrants to EIB exercisable into the Company’s common stock at a price of $ 0.0001 per share (Note 13) and drew EUR 7,000 under Tranche B of the EIB Loan Facility on November 23, 2020.

Borrowing under Tranche B carried interest at EURIBOR plus 5 % per annum ( 4.457 % at December 31, 2020).

The borrowings under the EIB Loan Facility were due in full five years from the disbursement date of the relevant tranche, which have been classified in non-current portion of Long-term debt on the Consolidated Balance Sheet at December 31, 2020, with interest payable quarterly in arrears.

The prepayment premium on the EIB Loan Facility for Tranches B was 3 % in the first year, 2 % in the second year and 1 % in the third year on the principal amount of the loan repaid.

The EIB Loan Facility included covenants that limit the Company’s ability to, among other things, dispose assets, consummate mergers and acquisitions, incur additional indebtedness, grant liens, pay dividends or other distributions without preapproval by EIB.

The Company incurred $ 551 of debt issuance costs and issued common stock warrants with an estimated fair value of $ 3,612 at their dates of issuance, the total of which has been presented as a deduction from the carrying amounts of the EIB Loan Facility on the Consolidated Balance sheet and were being amortized to interest expense over the term of the EIB Loan Facility.

In May 2021, the outstanding balance of the EIB Loan Facility was paid off.

On September 24, 2021, EIB submitted a notice of cancellation for 775,966 EIB warrants (Tranche A).

The valuation for settlement of these warrants was based on a 20 -day volume weighted average price (“VWAP”) valuation method using the Company’s publicly traded stock price as of September 30, 2021.

On October 18, 2021, EIB submitted a notice of cancellation for the remaining 775,966 EIB warrants (Tranche B).

The valuation for settlement of these warrants was based on the VWAP 20-day trading price method as of October 14, 2021, as stated in the notice of cancellation.

These warrants were settled in November 2021 for $ 19,942 .

Eastward Loan Facility

In December 2020, the Company entered into a loan agreement with Eastward Fund Management, LLC (“Eastward”) to borrow up to $ 25,000 (the “Eastward Loan Facility”).

On December 30, 2020, the Company drew $ 15,000 of the available loan facility under the Eastward Loan Facility and incurred a $ 300 repayment fee due upon maturity of the Eastward Loan Facility.

In conjunction with the Eastward loan agreement, the Company agreed to issue to Eastward up to a total of 314,861 warrants to acquire the Company’s common stock if the full facility was drawn.

The Company paid a 1 % commitment fee on the principal amount borrowed.

The Company would have paid interest only for the first 24 months this loan was outstanding and then $ 625 plus interest during each of the final 24 months this loan was outstanding.

The interest rate for the Eastward Loan Facility was 11.75 % per annum and the total term of this loan was 48 months.

The prepayment premium on the Eastward Loan Facility was 3 % during the first two years, 2 % in the third year and 1 % thereafter on the principal amount of the loan repaid.

The Eastward Loan Facility included covenants that limit the Company’s ability to, among other things, dispose assets, consummate mergers and acquisitions, incur additional indebtedness, grant liens, pay dividends or other distributions without preapproval by Eastward.

On December 30, 2020, the Company issued to Eastward 188,916 warrants exercisable into the Company’s common stock at a price of $ 3.97 per share (Note 13).

These warrants have been determined to be accounted for as equity at their estimated fair value at the date of issuance.

The Company recorded $ 542 as Additional paid-in capital and presented the related debt issuance costs as a deduction from the carrying amounts of the Eastward Loan Facility on the Consolidated Balance Sheet which are being amortized to interest expense over the term of the Eastward Loan Facility.

In May 2021, the outstanding balance of Eastward Loan Facility was paid off.

FP Term Loan Facility

On April 15, 2021, the Company entered into a credit agreement with FP Credit Partners, L.P., as agent for several lenders (the “FP Lenders”) (as amended on May 17, 2021, the “FP Credit Agreement”), for a $ 70,000 term loan facility (the “FP Term Loan”).

Upon funding in May 2021, the FP Term Loan was used (i) to pay off the Company's existing credit facilities with Eastward Fund Management, LLC (the “Eastward Loan Facility”) and EIB (the “EIB Loan Facility”) and (ii) to fund working capital and for general corporate purposes.

The Company incurred $ 12,277 of debt issuance costs relating to the FP Term Loan.

The FP Lenders had the option to elect to convert a portion of their specified contractual return into common stock of the Company immediately preceding the Merger, at a conversion price specified in the FP Term Loan Agreement by submitting a notice to convert on or prior to the funding date in May 2021 (the “Conversion Election”).

If the FP Lenders had exercised the Conversion Election, and the Company did not elect to repay the outstanding principal amount of the FP Term Loan at the Closing, then the interest rate would have increased to 9 % per annum.

However, the FP Lenders did not make the Conversion Election and so the interest rate would have decreased to 4 % per annum upon the occurrence of the Merger under the original terms of the FP Term Loan Agreement.

At the date of the closing of the FP Term Loan Agreement, the contingent interest feature described immediately above was determined to be an embedded derivative asset with an associated debt premium recorded.

The fair value of this financial instrument of $ 8,922 was presented net within Long-term Debt on the Consolidated Balance Sheets at June 30, 2021.

However, because of the interest rate increase under the FP Amendment (as defined below), the contingent interest embedded derivative asset and associated debt premium were derecognized upon the execution of the FP Amendment.

The FP Term Loan includes covenants that limit the Company’s ability to, among other things, make investments, dispose of assets, consummate mergers and acquisitions, incur additional indebtedness, grant liens, enter into transactions with affiliates, pay dividends or other distributions without preapproval by the FP Lenders.

The Company was required to maintain minimum unrestricted cash of at least $ 15,000 as of each fiscal quarter end, except for the

Blue Torch Credit Agreement

On June 13, 2022, the Company, as borrower, and Spire Global Subsidiary, Inc.

and Austin Satellite Design, LLC, as guarantors, entered into a Financing Agreement (the “Blue Torch Financing Agreement”) with Blue Torch Finance LLC, a Delaware limited liability company (“Blue Torch”), as administrative agent and collateral agent, and certain lenders (the “Lenders”).

The Blue Torch Financing Agreement provides for, among other things, a term loan facility in an aggregate principal amount of up to $ 120,000 (the “Blue Torch Credit Facility”).

A portion of the proceeds of the term loan was used to repay the Company’s then-existing $ 70,000 credit facility with FP Credit Partners, L.P., and the remainder of the proceeds of the term loan may be used for general corporate purposes.

The Blue Torch Credit Facility is scheduled to mature on June 13, 2026, upon which the Company must repay the outstanding principal amount of any outstanding loans thereunder, together with all accrued but unpaid interest, fees and other obligations owing under the Blue Torch Credit Facility.

Subject to certain exceptions, prepayments of the Blue Torch Credit Facility will be subject to early termination fees in an amount equal to 3.0% of the principal prepaid if prepayment occurs on or prior to the first anniversary of the closing date, 2.0% of principal prepaid if prepayment occurs after the first anniversary of the closing date but on or prior to the second anniversary of the closing date and 1.0% of principal prepaid if prepayment occurs after the second anniversary of the closing date but on or prior to the third anniversary of the closing date, plus if prepayment occurs on or prior to the first anniversary of the closing date, a make-whole amount equal to the amount of interest that would have otherwise been payable through the maturity date of the Blue Torch Credit Facility.

The $120,000 term loan was available and drawn at closing, of which $19,735 was placed in an escrow account by Blue Torch with such amount to be released upon the Company achieving certain metrics related to annualized recurring revenue and a total annualized recurring revenue leverage ratio.

These metrics were achieved and the $19,735 was released from the escrow account and delivered to the Company in February 2023 (Note 16).

The term loan accrues interest at a floating rate, to be based, at the Company's election, on either a reference rate or a 3-month Term Secured Overnight Financing Rate ("SOFR") (subject to a 1.0% floor), plus an interest rate margin of 7.0% for reference rate borrowings and 8.0% for 3-month Term SOFR borrowings, plus an incremental Term SOFR margin of 0.26161%.

The Company elected the Term SOFR rate which was 12.75713 % as of December 31, 2022.

Principal on the term loan is only payable at maturity and interest on the term loan is due and payable monthly for reference rate borrowings and quarterly for Term SOFR borrowings.

The Company is also required to pay other customary fees and costs in connection with the Blue Torch Credit Facility, including a commitment fee in an amount equal to $ 2,400 on the closing date, a $ 250 agency fee annually and an exit fee in an amount equal to $ 1,800 upon termination of the Blue Torch Financing Agreement.

The Company’s obligations under the Blue Torch Financing Agreement are or will be guaranteed by certain of its domestic and foreign subsidiaries meeting materiality thresholds set forth in the Blue Torch Financing Agreement.

Such obligations, including the guarantees, are secured by substantially all of the personal property of the Company and the Company's subsidiary guarantors, including pursuant to a Security Agreement entered into on June 13, 2022 among the Company, Spire Global Subsidiary, Inc., Austin Satellite Design, LLC and Blue Torch.

As of the closing date, such subsidiary guarantors were Spire Global Subsidiary, Inc., Austin Satellite Design, LLC, Spire Global Canada Subsidiary Corp.

and exactEarth Ltd.

The Blue Torch Financing Agreement contains customary affirmative covenants and customary negative covenants limiting the Company's ability and the ability of its subsidiaries to, among other things, dispose of assets, undergo a change in control, merge or consolidate, make acquisitions, incur debt, incur liens, pay dividends, repurchase stock and make investments, in each case subject to certain exceptions.

The Company must also comply with a maximum debt to annualized recurring revenue leverage ratio financial covenant tested monthly during the first two years of the Blue Torch Financing Agreement, a maximum debt to EBITDA leverage ratio financial covenant tested monthly during the third and fourth years of the Blue Torch Financing Agreement and a minimum liquidity financial covenant tested at all times.

The Blue Torch Financing Agreement also contains customary events of default that include, among other things, certain payment defaults, cross defaults to other indebtedness, inaccuracy of representations and warranties, covenant defaults, change of control defaults, judgment defaults, and bankruptcy and insolvency defaults.

If an event of default exists, Blue Torch as agent on behalf of the Lenders may require immediate payment of all obligations under the Blue Torch Financing Agreement and may exercise certain other rights and remedies provided for under the Blue Torch Financing Agreement, the other loan documents and applicable law.

Under certain circumstances, a default interest rate will apply on all obligations during the existence of an event of default under the Blue Torch Financing Agreement at a per annum rate equal to 2.00 % above the applicable interest rate.

On June 13, 2022, in connection with the Blue Torch Financing Agreement, the Company granted warrants to affiliates of the Lenders to purchase fully paid and non-assessable shares of Class A common stock (the “Blue Torch Warrants”), which are exercisable for an aggregate of 3,496,205 shares of the Company’s Class A common stock with a per share exercise price of $ 2.01 .

In addition, on June 13, 2022, in connection with the closing of the financing, the Company paid Urgent Capital LLC, a Delaware limited liability company, a fee for introducing the Company to the Lenders, for the purpose of loan financing, in the amount equal to $ 600 in cash and a warrant to purchase fully paid and non-assessable shares of Class A common stock (the “GPO Warrant”

and, collectively with the Blue Torch Warrants, the “Credit Agreement Warrants”), which is exercisable for an aggregate of 198,675 shares of the Company's Class A common stock with a per share exercise price of $ 2.01 .

Spire Global, Inc.

2 unchanged sentences

(In thousands, except shares and per share data, unless otherwise noted)

quarter immediately following the first quarter where the Company reports positive EBITDA, until the closing of a qualifying IPO, which includes the Merger.

The Company issued an equity grant of 977,723 shares of New Spire Class A Common Stock with a value of $ 8,065 to the FP Lenders upon funding of the FP Term Loan.

On August 5, 2021, the Company and FP Lenders executed an amendment (the “FP Amendment”) to the FP Term Loan to modify certain terms.

Among other things, the FP Amendment waived the instance of the noncompliance with provisions for the timely notification of the Company’s election to add accrued unpaid interest as of June 30, 2021 to the outstanding principal.

The FP Lenders also waived any default interest that would have applied as a result of the noncompliance.

The FP Amendment also reinstated the previously expired Conversion Election and served as formal notice of this election by the FP Lenders.

As a result, the FP Lenders received 1,490,769 shares of New Spire Class A Common Stock.

In connection with FP’s exercise of the Conversion Election, the interest rate on the FP Term Loan increased to 9 % per annum following the Closing.

The Company has determined that the FP Amendment represents an accounting modification of the original FP Term Loan.

In connection with the debt modification accounting, no gain or loss was recorded related to the FP Amendment, and the Company capitalized the fair value of $ 14,803 for the 1,490,769 shares of New Spire Class A Common Stock issued to the FP Lenders to be amortized over the remaining life of the FP Term Loan as part of the effective yield of the FP Term Loan beginning in the third quarter of 2021.

The FP Term Loan matures on April 15, 2026 and is collateralized by substantially all assets of the Company.

The Company has the option to prepay the loan in advance of its final maturity, which was subject to a prepayment penalty under the original terms of the FP Term Loan Agreement that varied between $ 17,500 and $ 49,000 based on the timing and circumstances of the repayment.

During the year ended December 31, 2021, the Company recognized within Other (expense) income, net on the Consolidated Statement of Operations, $ 4,954 as a loss on extinguishment of debt, resulting from paying off the EIB Loan Facility and the Eastward Loan Facility, and $ 1,699 as a gain from extinguishment of debt resulting from the U.S.

government’s forgiveness of the Company’s loan under the Paycheck Protection Program (“PPP”) established as part of the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act.

The Company evaluated the Credit Agreement Warrants and concluded that they do not meet the criteria to be classified within stockholders’

The agreements governing the Credit Agreement Warrants include a provision that could result in a different settlement value for the Credit Agreement Warrants depending on their holder.

The exercise price is $ 2.01 per share subject to standard stock split, dividend, and routine anti-dilution adjustment provisions.

Because the holder of an instrument is not an input into the pricing of a fixed-for-fixed option on the Company’s Class A common stock, the Credit Agreement Warrants are not considered to be indexed to the Company’s Class A common stock.

As the Credit Agreement Warrants meet the definition of a derivative, the Company recorded these warrants as liabilities on the consolidated balance sheets at fair value (Note 10) based on the Black-Scholes model as of June 13, 2022 with inputs that include the Company’s Class A common stock price in an actively traded market, making this fair value classified as a Level 2 financial instrument.

The other significant assumptions used in the model are the exercise price, expected term, volatility, interest rate, and dividend yield.

Subsequent changes in their respective fair values are recognized in the consolidated statements of operations at each reporting date.

Changes in the fair value of the warrant liabilities will continue to be recognized until the warrants are exercised, expire, or qualify for equity classification.

The Company incurred $ 4,516 of debt issuance costs, inclusive of fees paid to the Lenders, and issued Credit Agreement Warrants with an estimated fair value of $ 3,579 at the date of issuance, the total of which has been presented as a deduction from the carrying amounts of the Blue Torch Credit Facility on the consolidated balance sheets and is being amortized to interest expense over the term of the Blue Torch Credit Facility.

The Credit Agreement Warrants may be exercised on a cashless basis.

The Credit Agreement Warrants are exercisable for a term beginning on the date of issuance and ending on the earlier to occur of ten years from the date of issuance or the consummation of certain of the Company's acquisitions as set forth in the Credit Agreement Warrants.

The number of shares for which the Credit Agreement Warrants are exercisable and the associated exercise price are subject to certain proportional adjustments as set forth in the Credit Agreement Warrants.

FP Term Loan Facility

On April 15, 2021, the Company entered into a credit agreement with FP Credit Partners, L.P., as agent for several lenders (the “FP Lenders”), for a $ 70,000 term loan facility (as amended on May 17, 2021, the “FP Term Loan”).

The FP Term Loan included covenants that limited the Company’s ability to, among other things, make investments, dispose of assets, consummate mergers and acquisitions, incur additional indebtedness, grant liens, enter into transactions with affiliates, or pay dividends or other distributions without preapproval by the FP Lenders.

The Company was required to maintain minimum unrestricted cash of at least $ 15,000 as of each fiscal quarter end, except for the quarter immediately following the first quarter where the Company reports positive earnings before interest, taxes, depreciation, and amortization (EBITDA), until the closing of a qualifying initial public offering (IPO), which included the Merger.

On June 13, 2022, the Company repaid in full all obligations and all amounts borrowed, and all obligations have terminated, under the FP Term Loan, which was replaced by the Blue Torch Financing Agreement.

The outstanding principal and interest under the FP Term Loan in an aggregate amount equal to approximately $ 72,835 was repaid with proceeds of the term loan under the Blue Torch Credit Facility.

The Company recognized $ 22,510 as a loss on extinguishment of debt on the consolidated statements of operations during the year ended December 31, 2022, upon extinguishing the FP Term Loan facility.

The Company incurred no early termination penalties in connection with the termination of the FP Term Loan.

During the year ended December 31, 2021, the Company recognized $ 4,954 as a loss on extinguishment of debt in the consolidated statements of operations, resulting from cash settlement of then-existing loan facilities from European Investment Bank and Eastward Fund Management, LLC using the proceeds received from the FP Term Loan facility.

The loss on extinguishment of debt was partially offset by a $ 1,699 gain from extinguishment of debt resulting from the U.S.

government’s forgiveness of the Company’s loan under the Paycheck Protection Program established as part of the Coronavirus Aid, Relief, and Economic Security Act.

Government Loan

In November 2021, the Company completed its acquisition of exactEarth and assumed an interest free loan agreement with the Strategic Innovation Fund ("SIF") which was recorded at an amount equal to the proceeds received.

As of December 31, 2021 $ 4,464 was included in Long-term debt, non-current on the Consolidated Balance Sheets.

In November 2021, the Company completed the Acquisition and assumed an interest free loan agreement with the Strategic Innovation Fund ("SIF") which was recorded at an amount equal to the proceeds received.

As of December 31, 2022 and 2021, $ 4,857 and $ 4,464 , respectively, was included in long-term debt, non-current on the consolidated balance sheets related to the SIF loan agreement.

Under this agreement and subsequent amendment, the Company is eligible to receive funding for certain expenditures incurred from February 13, 2018 to May 12, 2023 to a maximum of $ 5,701 .

The loan is repayable in 15 annual payments beginning February 28, 2026.

Any amount outstanding under this loan is repayable in 15 annual payments beginning February 28, 2026.

Convertible Notes

Between July 2019 and October 2020, the Company entered into several subordinated convertible note purchase agreements for gross proceeds totaling $ 42,884 (the “2019 and 2020 Convertible Notes”).

The 2019 and 2020 Convertible Notes accrue interest at 8 % per annum, compounded quarterly.

In May 2021, the Company and the holders of the 2019 and 2020 Convertible Notes agreed to extend the maturity date of all convertible promissory notes outstanding at December 31, 2020 from January 29, 2022 to July 31, 2022 .

If not converted, at the option of the holders, all unpaid principal, interest and a balloon payment of 5 % of the principal balance is due on the stated maturity date of July 31, 2022.

The accretion of the carrying value of the Convertible Notes for the additional balloon payment is recorded as additional interest expense over the term of the 2019 and 2020 Convertible Notes.

In connection with securing the 2019 and 2020 Convertible Notes, the Company incurred debt issuance costs of $ 392 that have been recorded as a deduction of the carrying amount of convertible debt and are being amortized to interest expense over the term of the 2019 and 2020 Convertible Notes.

Conversion of the 2019 and 2020 Convertible Notes can be automatic based on events such as an initial public offering (“IPO”) by the Company or voluntary based on events such as a change of control or maturity.

The 2019 and 2020 Convertible Notes accrued interest at 8 % per annum, compounded quarterly.

The accretion of the carrying value of the Convertible Notes for the additional balloon payment was recorded as additional interest expense over the term of the 2019 and 2020 Convertible Notes.

In connection with securing the 2019 and 2020 Convertible

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

Notes, the Company incurred debt issuance costs of $ 392 that were recorded as a deduction of the carrying amount of convertible debt and were being amortized to interest expense over the term of the 2019 and 2020 Convertible Notes.

From January 2021 through February 2021, the Company issued and sold several convertible promissory notes in the aggregate amount of $ 20,000 (the “2021 Convertible Notes”, and together with the 2019 and 2020 Convertible Notes, the “Convertible Notes”).

The 2021 Convertible Notes mature four years from the date of issuance and accrue interest at 8 % per annum, compounded quarterly.

In connection with securing the 2021 Convertible Notes, the Company incurred debt issuance costs of $ 62 that have been recorded as a deduction of the carrying amount of convertible debt and are being amortized to interest expense over the life of the 2021 Convertible Notes.

Conversion of the 2021 Convertible Notes can be automatic based on events such as an IPO by the Company or voluntary based on events such as a change of control or maturity.

Immediately prior to the effective time of the Merger, the Convertible Notes were automatically converted into shares of Old Spire Common Stock.

The conversion ratio to Old Spire Common Stock for the 2019 and 2020 Convertible Notes was 2.4808 whereas the conversion ratio to Old Spire Common Stock for the 2021 Convertible Notes was 13.6466 .

This conversion then gave the right to receive shares of New Spire Class A Common Stock equal to the number of shares of Old Spire Common Stock received from such conversion multiplied exchange ratio of 1.7058 .

Total accrued interest on Convertible Notes was $ 0 and $ 5,944 as of December 31, 2021 and 2020, respectively, and included in Convertible notes payable, net on the Consolidated Balance Sheets.

The 2021 Convertible Notes would have matured four years from the date of issuance and accrued interest at 8 % per annum, compounded quarterly.

In connection with securing the 2021 Convertible Notes, the Company incurred debt issuance costs of $ 62 that were recorded as a deduction of the carrying amount of convertible debt and were amortized to interest expense over the life of the 2021 Convertible Notes.

Conversion of the 2019, 2020 and 2021 Convertible Notes could be automatic based on events such as an IPO by the Company or voluntary based on events such as a change of control or maturity.

Immediately prior to the effective time of the Merger, the Convertible Notes were automatically converted into shares of Legacy Spire Common Stock.

The conversion ratio to Legacy Spire Common Stock for the 2019 and 2020 Convertible Notes was 2.4808 whereas the conversion ratio to Legacy Spire Common Stock for the 2021 Convertible Notes was 13.6466 .

This conversion then gave the right to receive shares of New Spire Class A common stock equal to the number of shares of Legacy Spire Common Stock received from such conversion multiplied exchange ratio of 1.7058 .

After the conversion of the Convertible Notes, the balloon interest accrual of $ 1,698 was reversed in August 2021, which was only payable upon full maturity of the Convertible Notes.

The Company recorded $ 2,103 and $ 4,490 of interest expense on the Convertible Notes for the years ended December 31, 2021 and 2020, respectively.

The Company recorded $ 2,103 of interest expense on the Convertible Notes for the year ended December 31, 2021 and no interest expense was recorded for the year ended.

December 31, 2022.

The Company adopted ASC 842 on January 1, 2022 and included below is the Company's accounting policy for lessee accounting.

The Company leases office facilities, ground station facilities, and office equipment.

At the inception of a contract, the Company determines whether the contract is or contains a lease.

Leases are classified as operating or finance leases at the commencement date of the lease.

Operating leases with a term greater than one year are recognized on the consolidated balance sheet as ROU assets and lease liabilities, which are reported as separate line items.

Lease liabilities are classified between current and long-term liabilities based on the portion of the total payments that are due in the next 12 months that are attributed to principal payments.

The Company does not currently have any leases that are classified as finance leases.

The Company has elected the short-term leases practical expedient which allows any leases with a term of 12 months or less to be considered short-term and thus will not have an ROU asset or lease liability recognized on the balance sheet in respect of such leases.

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease.

Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the lease commencement date.

As these leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments.

The incremental borrowing rate is the rate incurred to borrow on a collateralized basis over a similar term and amount equal to the lease payments in a similar economic environment.

Operating lease ROU assets also include any lease payments made in advance of lease expense and excludes lease incentives and initial direct costs incurred.

Lease terms may include options to extend or terminate the leases, which the Company does not include in its minimum lease terms unless the options are reasonably certain to be exercised.

The majority of office facilities leases have an initial non-cancelable term of one to ten years with several renewal options that can extend the lease term from three to ten years .

Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

ROU assets are subject to evaluation for impairment of disposal on a basis consistent with other long-lived assets.

The amortization period for a ROU asset is from the lease commencement date to the earlier of the end of the lease term or the end of the useful life of the asset.

The Company has lease agreements with lease and non-lease components which the Company has elected to account for as a single lease component.

The Company's lease agreements do not contain any material residual value guarantees.

Lease expenses for the year ended December 31, 2022 were $ 3,409 .

Aggregate variable lease expenses and short-term lease expenses were $ 548 for the year ended December 31, 2022.

The following table provides the required information regarding the Company's leases for which the Company is the lessee:

As of December 31, 2022

As of January 1, 2022

Total ROU assets

Total lease liabilities

Weighted-average remaining lease term (years)

Weighted-average discount rate

Spire Global, Inc.

2 unchanged sentences

(In thousands, except shares and per share data, unless otherwise noted)

The majority of the Company's ROU assets and lease liabilities, approximate ly 80 %, relate to office facilities leases, with the remaining amounts representing primarily ground station leases.

As of December 31, 2022, the maturity of operating leases are as follows:

Years ending December 31,

Total lease payments

Interest on lease payments

Present value of lease liabilities

Operating cash flows paid included in the measurement of operating lease liabilities for the year ended December 31, 2022 was $ 1,632 and was included in net cash used in operating activities in the consolidated statements of cash flows.

Amortization of ROU assets was $ 2,344 for the year ended December 31, 2022.

Information as of December 31, 2021 under historical lease accounting guidance:

Although the Company has adopted ASC 842 using the modified retrospective approach, prior periods presented in the Company's consolidated financial statements continue to be in accordance with the former lease standard, ASC 840, Leases.

These disclosures include:

Under the previous lease standard, the Company leases office facilities and sites for its ground stations under noncancelable operating leases.

As of December 31, 2021, these leases expire at various dates through 2029.

Rent expense, including ground station leases, for the year ended December 31, 2021 was $ 3,313 .

Future minimum lease payments under noncancelable operating leases that have initial or remaining noncancelable lease terms greater than one year as of December 31, 2021 are as follows:

Years ending December 31,

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

Fair Value Measurement

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following tables present the Company’s fair value hierarchy for its financial instruments that are measured at fair value on a recurring basis:

December 31, 2022

Long-term liabilities

Cash and cash equivalents:

Money market funds

Commercial paper

Marketable securities:

treasury bills and bonds

Corporate securities

Commercial paper

government and agency securities

Current liabilities:

Public Warrants

Private Placement warrants

Long-term liabilities:

Credit Agreement Warrants

Contingent earnout liability

1 unchanged sentence

Long-term liabilities:

EIB warrant liability

Public Warrants

The fair value of the Public Warrants is based on quoted market prices and is classified as a Level 1 financial instrument.

Private Warrants

Contingent earnout liability

(1) There were no cash equivalents or marketable securities as of December 31, 2021.

Financial Assets

The Company values its Level 1 assets, consisting of money market funds and U.S.

treasury bills and bonds, using quoted prices in active markets for identical instruments.

Financial assets whose fair values that are measured on a recurring basis using Level 2 inputs consist of commercial paper, corporate securities, and U.S.

government and agency securities.

The Company measures the fair values of these assets with the help of a pricing service that either provides quoted market prices in active markets for identical or similar securities or uses observable inputs for their pricing without applying significant adjustments.

Public and Private Placement Warrants

In November 2022, the Company announced the commencement of an exchange offer (the "Offer") and consent solicitation relating to all holders of the Public Warrants and Private Warrants ("Warrants") to receive 0.2 shares of Class A common stock in exchange for each outstanding Warrant tendered by the holder.

On December 19, 2022, a total of 16,556,489 Warrants were tendered and exchanged for 3,311,286 shares of Class A common stock.

Concurrently with the Offer, the Company also solicited consents from holders of the Public Warrants to amend the Warrant Agreement to permit the Company to require that each Warrant that is outstanding upon the closing of the Offer be exchanged for 0.18 shares of Class A common stock, which is a ratio 10 % less than the exchange ratio applicable to the Offer (such amendment, the “Warrant Amendment”).

Because consents were received from holders of more than 65 % of the Company’s outstanding Public Warrants, the Warrant Amendment was approved.

On December 19, 2022, the Company exercised its right to acquire and retire all remaining outstanding Warrants in exchange for shares of Class A common stock in accordance with the terms of the Warrant Amendment, which occurred on January 4, 2023 (Note 16).

Public Warrants

The Company assumed 11,499,992 publicly-traded warrants (“Public Warrants”) upon the Merger, all of which were issued in connection with

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

NavSight’s initial public offering and entitled the holder to purchase one share of the Company’s Class A common stock at an exercise price of $ 11.50 per share.

The fair value of the Public Warrants is based on the quoted market price and is classified as a Level 1 financial instrument.

On December 19, 2022, a total of 9,956,489 Public Warrants were tendered for 1,991,298 shares of the Company's Class A common stock.

On the same day, the Company exercised its right, pursuant to the Warrant Amendment, to acquire and retire all remaining outstanding Public Warrants in exchange for shares of Class A common stock in accordance with the terms of the Warrant Amendment, which occurred on January 4, 2023.

Private Placement Warrants

The Company assumed 6,600,000 private placement warrants issued by NavSight (“Private Warrants”) upon the Merger, all of which were issued in connection with NavSight’s initial public offering and entitled the holder to purchase one share of the Company’s Class A common stock at an exercise price of $ 11.50 per share.

The Private Warrants are non-redeemable for cash so long as they are held by the initial purchasers or their permitted transferees.

If the Private Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Warrants are redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.

The fair value of the Private Warrants is estimated using the Black-Scholes model with inputs that include the Company’s stock price in an actively traded market, making this fair value classified as a Level 2 financial instrument.

The other significant assumptions used in the model are the exercise price, expected term, volatility, interest rate, and dividend yield.

The other significant assumptions used in the model are the exercise price, expected term, volatility, interest rate, and expected dividend yield.

On December 19, 2022, a total of 6,600,000 Private Warrants were tendered for 1,320,000 shares of the Company's Class A common stock.

The table below quantifies the significant inputs used for the Private Warrants:

Fair value of the Company’s common stock

Fair value of the Company’s Class A common stock

Exercise price

3 unchanged sentences

Remaining contractual term (in years)

Contingent Earnout Liability

The estimated fair value of the contingent earnout liability was determined using a Monte Carlo simulation using a distribution of potential outcomes on a monthly basis over the Earnout Period (Note 3) prioritizing the most reliable information available.

The assumptions utilized in the calculation are based on the achievement of certain stock price milestones, including the current price of the Company’s common stock, expected volatility, risk-free rate, expected term and dividend rate.

The table below quantifies the significant inputs used for the Contingent Earnout Liability:

Fair value of the Company’s common stock

Credit Agreement Warrants

In connection with the Blue Torch Financing Agreement, the Company issued the Blue Torch Warrants, which are exercisable for an aggregate of 3,496,205 shares of the Company’s Class A common stock with a per share exercise price of $ 2.01 .

Additionally, in connection with the closing of the financing, the Company issued the GPO Warrant, which is exercisable for an aggregate of 198,675 shares of the Company's Class A common stock with a per share exercise price of $ 2.01 .

The fair value of the Credit Agreement Warrants is estimated using the Black-Scholes model with inputs that include the Company’s Class A common stock price in an actively traded market, making this fair value classified as a Level 2 financial instrument.

The other significant assumptions used in the model are the exercise price, expected term, volatility, interest rate, and expected dividend yield.

The table below quantifies the significant inputs used for the Credit Agreement Warrants:

Fair value of the Company’s Class A common stock

Exercise price

Risk-free interest rate

2 unchanged sentences

Remaining contractual term (in years)

EIB Warrant Liabilities

The warrant liability in the tables above consisted of the fair value of warrants to purchase the Company’s common stock at a price of $ 0.0001 per share (or redeem for cash) and preferred stock and was based on the significant inputs not observable in the market, which prior to the Merger represented a Level 3 measurement within the fair value hierarchy.

The Company’s valuation of the stock warrants utilized the Black-Scholes option-pricing model, which incorporates assumptions and estimates to value the stock warrants.

Changes in the fair value of the stock warrants are recognized in Other income (expense), net in the Consolidated Statements of Operations.

The quantitative inputs utilized in the fair value measurement of the stock warrant liability include the fair value per share of the Company’s common stock, the remaining contractual term of the warrants, risk-free interest rate, expected dividend yield and expected volatility of the price of the Company’s common stock.

Prior to the Merger, the Company determined the fair value per share of the Company’s common and preferred stock using a hybrid

Contingent Earnout Liability

In connection with the Merger, eligible Spire equity holders are entitled to receive additional shares of the Company's Class A common stock upon the achievement of certain earnout triggering events.

The estimated fair value of the contingent earnout liability is determined using a Monte Carlo simulation using a distribution of potential outcomes on a monthly basis over the earnout period, which is a period up to five years post-closing of the Merger, prioritizing the most reliable information available, making this fair value classified as a Level 3 liability.

The assumptions utilized in the calculation are based on the achievement of certain stock price milestones, including the current price of the Company’s Class A common stock, expected volatility, risk-free interest rate, expected term and expected dividend yield.

Spire Global, Inc.

2 unchanged sentences

(In thousands, except shares and per share data, unless otherwise noted)

valuation method that utilized a combination of an option pricing model method and the Probability-Weighted Expected Return Method (“PWERM”).

The PWERM is a scenario-based methodology that estimates the fair value of equity securities based upon an analysis of future values, assuming various outcomes.

As the probability of the Merger closing increased, the fair value of the EIB warrant liability increased as of the date of the exercise.

The risk-free interest rate is based on a treasury instrument for which the term is consistent with the expected life of the warrants.

As there was no public market for the Company’s common and preferred stock, the Company determined the expected volatility for warrants granted based on an analysis of reported data for a peer group of companies.

After the Merger, the EIB warrant liabilities moved from Level 3 to Level 2, as a result of the Company’s common stock now being traded on the New York Stock Exchange, until the date of settlement.

In November 2021, EIB warrants were settled for a cash amount of $ 19,942 .

As of December 31, 2021 no EIB warrants remained outstanding.

The table below quantifies the inputs used for the EIB warrants:

Fair value of the Company’s common stock

The table below quantifies the significant inputs used for the contingent earnout liability:

Fair value of the Company’s Class A common stock

Risk-free interest rate

Expected volatility factor

Remaining contractual term (in years)

The following table provides a roll-forward of the aggregate fair values of the Level 3 financial instruments:

Fair value at December 31, 2019

Issuance of warrants to EIB

Change in fair value

Fair value at December 31, 2020

Issuance of warrants to Silicon Valley Bank

Conversion of Silicon Valley Bank warrants to common stock

Exercise of Series C preferred warrants

Contingent interest embedded derivative recognized relating to the FP Term Loan agreement

Contingent interest embedded derivative derecognized upon the execution of the FP amendment

Contingent earnout liability recognized upon the closing of the reverse recapitalization

Change in fair value included in other income (expense), net

Transferred to Level 2 upon the closing of the reverse recapitalization

Fair value at December 31, 2021

During the year ended December 31, 2021, the Company issued 32,412 warrants at a fair value of $ 308 to Silicon Valley Bank with an exercise price of $ 1.60 .

The warrants allow the holder to acquire the Company’s common stock.

Silicon Valley Bank exercised the Series C warrants and they were converted into common stock upon the Closing.

Certain holders of Series C preferred stock exercised their warrants at a nominal amount to purchase 146,919 shares of the Company’s common stock at a fair value of $ 891 during the year ended December 31, 2021.

Based on the recent rounds of debt financing during the years ended December 31, 2021 and 2020 and the terms of those debt agreements, current market conditions and the Company’s financial condition, the carrying amounts for Long-term debt and Convertible notes payable approximate fair value.

The carrying amounts reported on the Consolidated Balance Sheets of other assets and liabilities which are considered to be financial instruments approximate fair value based on their short-term nature and current market indicators are classified as Level 3.

Earnout expiration date

August 16, 2026

The following table presents a summary of the changes in the fair value of the Company’s Level 3 financial instruments that are measured at fair value on a recurring basis:

Fair value as of December 31, 2021

Change in fair value of contingent earnout liability

Fair value as of December 31, 2022

Cash and Cash Equivalents and Marketable Securities

The following table summarizes the Company's cash, cash equivalents and available-for-sale securities by significant marketable securities category:

December 31, 2022

Amortized Cost

Unrealized Gains

Unrealized Losses

Cash and cash equivalents:

Cash equivalents:

Money market funds

Commercial paper

Marketable Securities:

treasury bills and bonds

Corporate securities

Commercial paper

government and agency securities

There were no cash equivalents or marketable securities as of December 31, 2021.

The following table represents amortized cost and estimated fair value of marketable securities, by contractual maturity:

December 31, 2022

Amortized Cost

Due in one year or less

In accordance with the Company's investment policy, investments are placed in investment grade securities with high credit quality issuers, and generally limit the amount of credit exposure to any one issuer.

The Company evaluates securities for impairment at the end of each reporting period.

The Company did not record any impairment charges related to its available-for-sale securities during the year ended December 31, 2022.

Commitments and Contingencies

L3Harris Commitment

In conjunction with the Acquisition, the Company acquired the agreement with L3Harris ("L3Harris Agreement") to receive satellite automatic identification system ("S-AIS") data from the L3Harris AppStar payloads on-board Iridium NEXT Constellation, Iridium's Real-Time Second-Generation satellite constellation with 58 AppStar payloads.

Under the Amended and Restated L3Harris Agreement dated January 21, 2020

Spire Global, Inc.

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(In thousands, except shares and per share data, unless otherwise noted)

Warrant Equity

The following tables present the Company’s fair value hierarchy for its warrants classified as equity that are measured at fair value on a nonrecurring basis:

December 31, 2021

December 31, 2020

The warrant liability in the table above classified as equity was recorded at fair value on the date of issuance and is not remeasured.

The fair value of warrants was based on significant inputs not observable in the market, which represents a Level 3 measurement within the fair value hierarchy.

The Company’s valuation of the stock warrants utilized the Black-Scholes option-pricing model, which incorporates assumptions and estimates to value the stock warrants.

Commitments and Contingencies Operating Leases

The Company leases office facilities and sites for its ground stations under noncancelable operating leases.

These leases expire at various dates through 2029 .

Rent expense, including ground station leases, for the years ended December 31, 2021 and 2020, was $ 3,313 and $ 2,418 , respectively.

Future minimum lease payments under noncancelable operating leases that have initial or remaining noncancelable lease terms greater than one-year as of December 31, 2021 are as follows:

Years ending December 31,

2027 and thereafter

L3Harris Commitment

In conjunction with the exactEarth acquisition, the Company acquired the agreement with L3Harris ("L3Harris Agreement") to receive satellite automatic identification system ("S-AIS") data from the L3Harris AppStar payloads on-board Iridium NEXT Constellation, Iridium's Real-Time Second-Generation satellite constellation with 58 AppStar payloads.

Under the Amended and Restated L3Harris Agreement dated January 21, 2020 ("A&R L3Harris Agreement"), the Company incurs a fixed fee of $ 358 per month.

("A&R L3Harris Agreement"), the Company incurs a fixed fee of $ 358 per month.

The A&R L3Harris Agreement concludes on August 7, 2031.

Under the A&R L3Harris Agreement, the Company will pay a 30 % share of S-AIS data revenues for the portion of exactEarth annual S-AIS data revenue which is in excess of $ 16,000 .

No revenue share was owed to L3Harris under the A&R L3Harris Agreement, with respect to AIS Analytics sales during the year ended December 31, 2021.

For the year ended December 31, 2021, $ 417 was recognized in Cost of revenue on the Consolidated Statements of Operations.

No revenue share was owed to L3Harris under the A&R L3Harris Agreement, with respect to AIS Analytics sales, during the years ended December 31, 2022 and 2021.

For the years ended December 31, 2022 and 2021, $ 5,045 and $ 417 was recognized in cost of revenue in the consolidated statements of operations for the initial costs incurred to acquire exclusive access rights to data generated from satellites.

The following table summarizes the operational fees commitment under the A&R L3Harris Agreement, which includes the fixed payments to L3Harris:

Years ending December 31,

2027 and thereafter

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

At times, the Company is party to various claims and legal actions arising in the normal course of business.

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In connection with the Closing, the Company adopted the 2021 Equity Incentive Plan (the “2021 Plan”) and the 2021 Employee Stock Purchase Plan (“2021 ESPP”).

The number of shares available for issuance under the 2021 Plan will be increased on the first day of each fiscal year, beginning on January 1, 2022, in an amount equal to the lesser of (i) 23,951,000 shares of New Spire Class A Common Stock, (ii) a number of shares of New Spire Class A Common Stock equal to 5 % of the total number of shares of all of New Spire Class A Common Stock outstanding as of the last day of the immediately preceding fiscal year, or (iii) such number of shares of New Spire Class A Common Stock as the Company’s board of directors or its designated committee may determine no later than the last day of the immediately preceding fiscal year.

The number of shares available for issuance under the 2021 Plan will be increased on the first day of each fiscal year, beginning on January 1, 2022, in an amount equal to the lesser of (i) 23,951,000 shares of Class A common stock, (ii) a number of shares of Class A common stock equal to 5 % of the total number of shares of all of Class A common stock outstanding as of the last day of the immediately preceding fiscal year, or (iii) such number of shares of Class A common stock as the Company’s board of directors or its designated committee may determine no later than the last day of the immediately preceding fiscal year.

The 2021 Plan permits the grant of incentive stock options, nonstatutory stock options, stock appreciation rights, restricted stock, restricted stock units, and performance awards to employees, directors, or consultants under the 2021 Plan.

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As of December 31, 2022 , 5,685,295 and 4,059,162 shares were available for grant under the 2021 Plan and 2021 ESPP, respectively.

The following table summarizes stock option activity under the Plan:

Options outstanding at December 31, 2020 (1)

The following table summarizes stock option activity under the 2021 Plan and the 2012 Plan:

Options outstanding as of December 31, 2021

Forfeited, canceled, or expired

Options outstanding at December 31, 2021

Options outstanding as of December 31, 2022

Vested and expected to vest at December 31, 2022

Exercisable at December 31, 2022

(1) These amounts have been adjusted to correctly present the prior period activity and options outstanding at December 31, 2020.

The Company’s option award quantities and prices prior to the Merger have been retroactively restated to reflect the exchange ratio of approximately 1.8282 established in the Merger as described in Note 3.

The Company’s option award quantities and prices prior to the Merger have been retroactively restated to reflect the exchange ratio of

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

approximately 1.8282 established in the Merger as described in Note 3.

The aggregate intrinsic value of options exercised as of December 31, 2022 and 2021, was $ 483 and $ 5,339 , respectively.

The aggregate fair value of options vested as of December 31, 2021 and 2020 was $ 3,908 and $ 940 , respectively.

The aggregate fair value of options vested as of December 31, 2022 and 2021 wa s $ 6,072 and $ 3,908 , respectively.

The Company received $ 806 and $ 1,289 in cash proceeds from options exercised during the years ended December 31, 2022 and 2021, respectively.

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The following table summarizes stock RSU activity under the 2021 Plan:

Number of Shares

Number of RSUs

Weighted Average Grant Date Fair Value per Share

Outstanding as of December 31, 2021

RSU forfeited

RSUs forfeited

Outstanding as of December 31, 2022

For RSUs with service-based vesting conditions, the fair value is calculated based upon the Company’s closing stock price on the date of grant, and the stock-based compensation expense is recognized over the four-year vesting period.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

As of December 31, 2022, there was $ 31,518 of total unrecognized compensation expense related to options and RSUs expected to be recognized over a weighted average-period of 2.3 years.

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Stock-based compensation expense for options is recognized over their respective vesting period, which ranges from one to four years .

The fair value of all stock-based compensation was estimated using the following assumptions at the date of the grant:

The fair value of stock options was estimated using the following assumptions at the date of the grant:

Year Ended December 31,

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0.6 % - 1.4 %

0.4 % - 1.5 %

Expected volatility factor

66.9 % - 70.0 %

44.9 % - 68.4 %

Expected option life

5.0 - 6.08 years

5.1 - 6.8 years

Expected dividend yield

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

Stockholders’

In August 2021, the Company’s Board of Directors approved the amended and restated certificate of incorporation which states the Company’s authority to issue 1,000,000,000 shares of Class A and 15,000,000 shares of Class B common stock with a par value of $ 0.0001 per share.

The total number of shares of Preferred Stock authorized to be issued is 100,000,000 shares with a par value of $ 0.0001 per share.

The total number of shares of preferred stock authorized to be issued is 100,000,000 shares, par value $ 0.0001 per share, and no ne was outstanding as of December 31, 2022 and 2021.

Shares of Class A common stock have both economic and voting rights.

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In the event of liquidation, dissolution, distribution of assets or winding-up of the Company, the holders of common stock would receive payment on a pro rata basis on the number of shares held by each such holder, after the rights of the holders of the preferred stock have been satisfied.

Preferred Stock

On May 15, 2014, the Company issued 5,506,734 shares of Series A preferred stock with an original issuance price of $ 4.1767 per share for $ 22,900 .

In conjunction with the Series A preferred stock financing, convertible promissory notes of $ 8,000 , including principal and accrued interest, were converted into 7,165,177 shares of Series A preferred stock.

On June 15, 2015, the Company issued 4,869,754 shares of Series B preferred stock at an issuance price of $ 7.2615 per share for $ 35,228 .

Beginning on August 17, 2017, and at various subsequent closings in 2017, the Company issued 5,270,120 shares of Series C preferred stock with an original issuance price of $ 8.7078 per share for $ 45,800 .

In conjunction with the Series C preferred stock financing, convertible promissory notes of $ 15,600 , including principal and accrued interest, were converted into 2,236,153 shares of Series C preferred stock.

Upon the Closing Date of the merger, all preferred stock were converted into Class A Common Stock of New Spire (Note 3)

The following were the rights and privileges of the Company’s preferred stock:

Holders of preferred stock, in preference to the holders of common stock, shall be entitled to receive, but only out of funds legally available thereof, cash dividends at a rate of 8 % of the original issue price per annum on each outstanding share of preferred stock.

Such dividends shall be payable only when, as and if declared by the Board of Directors and shall be noncumulative.

As long as shares of preferred stock are outstanding, the Company is precluded

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

from declaring, paying or setting aside any dividends, or making any other distribution on the common stock, or purchasing, redeeming or otherwise acquiring for value any shares of common stock, unless all dividends on the preferred stock then have been paid or declared and set apart and the holders of the preferred stock then outstanding shall first receive, or simultaneously receive, a dividend on each outstanding share of preferred stock in an amount at least equal to the dividend payable on each share.

No dividends have been declared or paid out as of the Closing Date.

Voting Rights

Each holder of outstanding shares of preferred stock shall be entitled to cast the number of votes equal to the number of each share of common stock into which the shares of preferred stock held by each holder are convertible as of the record date for determining shareholders entitled to vote on such matter.

Holders of preferred stock shall vote together with the holders of common stock as a single class.

In the event of any voluntary or involuntary liquidation, the holders of preferred stock shall be entitled to receive, prior and in preference to any distribution of the proceeds of such liquidation to the holders of common stock, an amount per share equal to the sum of the applicable original issue price for the preferred stock, plus declared but unpaid dividends on such share.

Upon completion of the distribution to the preferred stockholders, all of the remaining proceeds available for distribution to stockholders shall be distributed among the holders of common stock pro rata based on the number of shares of common stock held by each holder.

The Long-term debt and Convertible Notes are senior in order of preference to the Company’s preferred stock and then common stock in the event of a liquidation.

Each share of preferred stock shall be convertible, at the option of the holder, at any time after the date of issuance of such share, into shares of common stock as is determined by dividing the applicable original issue price for such share of preferred stock by the applicable conversion price for such share of preferred stock.

The initial conversion price per share for each series of preferred stock shall be the original issue price applicable to such series.

The Company’s preferred stock is not redeemable at either the option of the Company or the holder.

Common and Preferred Stock Warrants

On September 29, 2017, the Company entered into a development agreement with an investor in the Series C preferred stock financing to develop an enhanced version of the Company’s hosted services which provides access to the Company’s satellite data.

In accordance with the terms of the Development Agreement, the Company issued warrants to purchase additional shares of the Series C preferred stock at the original issuance price.

The Series C warrants vest upon achievement of certain terms of the contract.

As of December 31, 2020, the Series C warrants were fully vested and unexercised.

As the Series C warrants were free-standing financial instruments that may require the Company to transfer assets upon exercise, these warrants were classified as liabilities and included in Other long-term liabilities on the Consolidated Balance Sheets at their estimated fair value as of each reporting date.

Under the terms of the EIB Loan Facility, on August 20, 2020, the Company issued to EIB 454,899 warrants exercisable into common shares at a price of $ 0.0001 per share.

On October 29, 2020, the Company issued to EIB an additional 454,899 warrants exercisable into common shares at a price of $ 0.0001 per share.

These common stock warrants were determined to be derivative liabilities due to EIB’s put option and are included in Other long-term liabilities on the Consolidated Balance Sheets at their estimated fair value.

As of December 31, 2020, the liability for these warrants was valued at $ 3,810 .

These warrants were settled in November 2021 for $ 19,942 (Note 8).

Under the terms of the Eastward Loan Facility, on December 30, 2020, the Company issued to Eastward 188,916 warrants exercisable into common shares at a price of $ 3.97 per share.

These common stock warrants have been determined to be accounted for as equity classified warrants and the Company recorded $ 542 as Additional paid-in capital in the Statement of Changes in Stockholders Equity (Deficit) for the year ended December 31, 2020 at their estimated fair value as of the date of issuance.

The Eastward warrants were settled upon the Closing Date of the Merger (Note 3).

Income (loss) before income taxes consisted of the following:

Loss before income taxes consisted of the following:

Year Ended December 31,

Domestic income (loss)

Income (loss) before income taxes

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

Domestic loss

Loss before income taxes

The income tax provision consists of the following:

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Effective tax rate

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

For 2022 and 2021, our effective tax rate differs from the amount computed by applying the statutory federal and state income tax rates to net loss before income tax, primarily as the result of state income taxes, R&D credits, foreign income taxes and changes in our valuation allowance.

The significant components of deferred tax assets (liabilities) are as follows:

5 unchanged sentences

Property and equipment

Operating lease liabilities

Sec 174 Capitalized R&D

Other accruals

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Deferred tax liabilities

Operating lease right-of-use assets

Foreign property and equipment and intangibles

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Realization of the deferred tax assets is dependent upon the generation of future taxable income, if any, the amount and timing of which are uncertain.

The Company could not conclude that it was more likely than not that tax benefits from operating losses would be realized and, accordingly, has provided a full valuation allowance against its United States, Singapore, Luxemburg, Canada, and a portion of their United Kingdom deferred tax assets.

The Company could not conclude that it was more likely than not that tax benefits from operating losses would be realized and, accordingly, has provided a full valuation allowance against its Spire Global United States, Australia, Singapore, Luxemburg, and exactEarth Canada and UK deferred tax assets.

There is no valuation allowance on Spire Global UK.

The valuation allowance as of December 31, 2021 was $ 74,558 , which increased to $ 102,480 a s of December 31, 2022.

The increase in the valuation allowance of $ 31,228 includes $ 10,347 related to the acquisition of exactEarth's deferred tax assets subjected to a valuation allowance through purchase accounting.

The increase in the valuation allowance of $ 27,922 includes $ 1 re lated to the acquisition of exactEarth's deferred tax assets subjected to a valuation allowance through purchase accounting.

The remaining valuation allowance change of $ 27,921 is mostly related to current year losses.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2021 and 2020

(In thousands, except shares and per share data, unless otherwise noted)

At December 31, 2022, the Company had $ 251,889 and $ 102,954 of federal and state net operating losses available to reduce future taxable income, which will begin to expire in 2032 for federal and state tax purposes.

1 unchanged sentence

At December 31, 2021, the Company ha d $ 189,313 and $ 64,739 of federal and state net operating losses available to reduce future taxable income.

The Company also has federal research and development tax credit carryforward o f $ 3,332 a nd $ 2,454 as of December 31, 2021 and 2020, respectively.

The Company also has federal research and development tax credit carryforwards o f $ 3,732 a nd $ 3,332 as of December 31, 2022 and 2021, respectively.

These federal tax credits begin to expire in 2039.

5 unchanged sentences

that exceeds 50 percentage points over a rolling three-year period.

The Company has not yet undertaken an analysis of whether the past equity financing transactions constitute an “ownership change”

The Company has not yet undertaken an analysis of whether the Merger constitutes an “ownership change”

for purposes of Internal Revenue Code Section 382 and Section 383.

The Company may experience ownership changes in the future from the sale of its equity or business combination transactions.

As of December 31, 2021, the Company had $ 12,063 , $ 2,685 , $ 16,793 and $ 188 of Luxembourg, Singapore, Canada and United Kingdom foreign net operating losses available to reduce future taxable income, which will begin to expire in 2035 for Luxembourg and in 2029 for Canada, while Singapore and United Kingdom have indefinite carry forward period.

The Company may experience ownership changes in the future as a result of subsequent shifts in its stock ownership.

As of December 31, 2022, the Company had $ 16,350 , $ 3,125 , $ 18,631 , $ 232 and $ 84 of Luxembourg, Singapore, Canada, United Kingdom and Australia foreign net operating losses available to reduce future taxable income, which will begin to expire in 2035 for Luxembourg and in 2029 for Canada, while Singapore, United Kingdom and Australia have indefinite carry forward periods.

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The Company does not have any significant uncertain tax positions.

Spire Global, Inc.

Notes to Consolidated Financial Statements

December 31, 2022 and 2021

(In thousands, except shares and per share data, unless otherwise noted)

The Company recognizes interest accrued related to unrecognized tax benefits in interest expense and penalties, if any, in general and administrative expense on the accompanying consolidated statements of operations.

2 unchanged sentences

The Company is subject to audit by the Internal Revenue Service for income tax returns filed since inception due to net operating loss carryforwards.

The Company is subject to audit in Singapore and the United Kingdom from tax years 2017 and 2018, respectively, and in Luxembourg from tax year 2019.

The Company is subject to audit in Singapore and the United Kingdom from tax years 2018 and 2019, respectively, and in Luxembourg from tax year 2020 and in Australia from tax year 2018.

Net Loss per Share

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Year Ended December 31,

Stock options to purchase common stock

Stock options and 2021 ESPP to purchase Class A common stock

Public and Private Warrants

Convertible preferred stock (if-converted)

Warrants for the purchase of Series C convertible preferred stock (if-converted)

Warrants for the purchase of common stock

Convertible notes (if-converted)

Credit Agreement Warrants

Subsequent Events

On December 19, 2022, the Company exercised its right to acquire and retire all remaining outstanding Public Warrants in exchange for shares of Class A common stock in accordance with the terms of the Warrant Amendment.

The remaining 1,543,493 of Public Warrants were exchanged on January 4, 2023 for 277,828 shares of the Company's Class A common stock.

Following the exchange, none of the Public Warrants or Private Warrants remain outstanding.

The Company has a $ 120,000 term loan with Blue Torch which was available and drawn at closing, of which $ 19,735 was placed in an escrow account by Blue Torch with such amount to be released upon the Company achieving certain metrics related to annualized recurring revenue and a total annualized recurring revenue leverage ratio.

Subsequent to December 31, 2022, these metrics were achieved and the $ 19,735 was released from the escrow account and delivered to the Company in February 2023.

On March 10, 2023, Silicon Valley Bank (“SVB”) was closed by the California Department of Financial Protection and Innovation, which appointed the Federal Deposit Insurance Corporation (“FDIC”) as receiver.

On March 13, 2023, the FDIC announced that it had transferred all deposits –

both insured and uninsured –

and substantially all assets of the former SVB to a newly created, full-service FDIC-operated “bridge bank”

called Silicon Valley Bank, N.A.

As of the close of business on March 14, 2023, the Company had approximately $ 31.2 million in cash and cash equivalents at Silicon Valley Bank, N.A., of which approximately $ 30.8 million was invested in BlackRock money market mutual funds.

The Company is in the process of transferring substantially all of its cash and cash equivalents out of Silicon Valley Bank, N.A.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7A. Quantitative and Qualitative Disclosures About Market Risk