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Item 3. Legal Proceedings

2025-03-03 compared with 2022-11-07 · 66 added, 5 removed, 6 unchanged (92% of the section changed)

1 unchanged sentence

From time to time, we are involved in various legal proceedings arising from the normal course of business activities.

For example, on April 5, 2021, we received a letter from the counsel for Carl Harris, a former employee, alleging that Mr.

Harris’s failure to exercise his stock options in early 2020 was induced by our improper conduct, and requested that we reinstate Mr.

Harris’s stock options.

We deny any wrongdoing and the matter has now been resolved through a mediated settlement.

Other than as described above, we are not currently a party to any legal proceedings that, if determined adversely to us, would, in our opinion, have a material adverse effect on our business, results of operations, financial condition, or cash flows.

Stockholder Litigation

On August 20, 2024, we and two of our executive officers were named as defendants in a purported federal securities law class action filed in the United States District Court for the Eastern District of Virginia, captioned Michal Bousso v.

Spire Global, Inc.

et al., Court File No.

1:24-cv-1458 (the "Bousso Lawsuit").

On October 14, 2024, a second plaintiff filed a similar lawsuit against us and three current or former executive officers, also in the United States District Court for the Eastern District of Virginia, captioned Kohei Tagawa v.

Spire Global, Inc.

et al., Court File No.

1:24-cv-1810 (the “Tagawa Lawsuit”).

On November 22, 2024, the court consolidated the Bousso Lawsuit and the Tagawa Lawsuit, appointed Michal Bousso as lead plaintiff, and renamed the case to “In re Spire Global, Inc.

Securities Litigation,” Master File No.

1:24-cv-1458-MSN-WEF (the “Master Securities Lawsuit”).

On December 23, 2024, the plaintiff filed an amended complaint in the Master Securities Lawsuit, which alleges violations of Sections 10(b) and 20(a) of the Exchange Act (and Rule 10b-5 thereunder), arising from or relating to our announcements in August 2024 that certain of our previously issued audited and unaudited financial statements should not be relied upon.

Plaintiff alleges that we and the individual defendants made false or misleading statements relating to (1) how revenue was recognized for pre-space services for certain space contracts, and (2) how costs for certain contracts were characterized.

The plaintiff seeks to represent a class of shareholders who purchased or otherwise acquired our common stock

between May 11, 2022 and August 14, 2024.

The plaintiff seeks damages and other relief, including attorneys' fees and costs.

The defendants are vigorously defending this lawsuit.

On January 22, 2025, the defendants moved to dismiss the amended complaint in its entirety.

Briefing on Defendants’ motion to dismiss is scheduled to be completed by the end of February 2025, and the motion is presently scheduled to be heard by the Court on March 14, 2025.

By statute, discovery is stayed in the Master Securities Lawsuit until the resolution of Defendants’ motion to dismiss.

On September 5, 2024, a stockholder derivative lawsuit was filed in the United States District Court for the Eastern District of Virginia, purportedly on behalf of us against certain of our officers and directors and us (as a nominal defendant), captioned Lawrence Hollin v.

Platzer et al.

, Court File No.

1:24-cv-01558 (the “ Hollin Lawsuit”).

On September 10, 2024, a second stockholder derivative lawsuit was filed in the United States District Court for the Eastern District of Virginia, also purportedly on behalf of us against certain of our officers and directors and us (as a nominal defendant), captioned Richard Cobb v.

Platzer et al.

, Court File No.

1:24-cv-01596 (the “ Cobb Lawsuit”).

On November 12, 2024, a third stockholder derivative lawsuit was filed in the United States District Court for the Eastern District of Virginia, also purportedly on behalf of us against certain of our officers and directors and us (as a nominal defendant) captioned L.

Robert Oros v.

Platzer et al.

, 1:24-cv-02020 (the “ Oros Lawsuit”).

On November 14, 2024, the Court consolidated the Hollin Lawsuit and the Cobb Lawsuit and renamed the case to In re Spire Global, Inc.

Stockholder Derivative Litigation , No.

1:24-cv-01596 (the “Master Derivative Case”).

On December 2, 2024, the Court consolidated the Oros Lawsuit into the Master Derivative Case.

The lawsuits in the Master Derivative Case arise out of the same subject matter as the Master Securities Lawsuit, and they allege some or all of the following claims:

(1) breach of fiduciary duty;

(2) gross mismanagement;

(3) waste of corporate assets;

(4) unjust enrichment;

(5) as against the director defendants, violations of Section 14(a) of the Exchange Act and Rule 14a-9 promulgated thereunder;

(6) as against the officer defendants, contribution under Sections 10(b) and 21D of the Exchange Act;

and (7) aiding and abetting.

Each of the lawsuits in the Master Derivative Case seeks damages and other relief, including attorneys' fees and costs.

The Master Derivative Case is currently stayed pending the motion to dismiss in the Master Securities Lawsuit.

Share Purchase Agreement Litigation

As previously disclosed, on November 13, 2024, we entered into a Share Purchase Agreement (the “ Purchase Agreement ”) with Kpler Holding SA, a Belgian corporation (“ Buyer ”), pursuant to which we agreed to sell our maritime business to Buyer and enter into certain ancillary agreements (the “ Transactions ”).

The maritime business to be sold pursuant to the Transactions does not include any part of our satellite network or operations.

The purchase price to be paid by Buyer to us at the closing of the Transactions is a cash payment based upon an enterprise value of $233.5 million, subject to certain adjustments.

The Transactions also include a twelve-month transition service and data provision agreement for $7.5 million.

The Purchase Agreement provides that the closing of the Transactions is subject to the satisfaction or waiver of certain closing conditions set forth in the Purchase Agreement.

We believe all conditions to closing contained in the Purchase Agreement have been satisfied or could be satisfied.

Notwithstanding our notice to Buyer to that effect, Buyer has failed to consummate the closing.

Buyer has cited various reasons for declining to close, which we have rejected.

There is currently no governmental order in effect prohibiting closing and, in the Purchase Agreement, Buyer agreed to “use best efforts, and to take any and all actions necessary, to eliminate each and every impediment that is asserted” by relevant government entities so as to enable the parties to consummate the Transactions promptly.

We believe that Buyer’s failure to close is not consistent with the terms of the Purchase Agreement, which do not give Buyer the option to delay closing once all closing conditions have been met.

As a result of the foregoing, on February 10, 2025, we filed a complaint in the Delaware Court of Chancery against Buyer seeking a grant of specific performance ordering Buyer to satisfy its obligations under the Purchase Agreement and consummate the closing in accordance with the terms of the Purchase Agreement.

In the complaint, we also requested a declaratory judgment declaring that Buyer has breached its obligations under the Purchase Agreement and is not excused from performing its obligations under the Purchase Agreement, including proceeding with the closing.

Kpler removed the matter to the District of Delaware, pursuant to a contract term in the Purchase Agreement promising not to contest removal to that court.

The District of Delaware initially selected a March 4 trial date, but on February 26, 2025, the court set a trial date of May 28-30, 2025.

There is no assurance as to what action the District of Delaware will take with respect to the proceeding initiated by us and there is no assurance as to whether or not the Transactions will be consummated on the terms contemplated or at all.

Whether or not the Transactions are consummated as required, we reserve all of our rights under the Purchase Agreement and in law and equity, including the right to seek damages and other remedies from Buyer.

The amount of any damages which may be sought or obtained from Buyer cannot be determined at this time.

Except as disclosed above, Spire is not currently a party to any legal proceedings that, if determined adversely to us, would, in our opinion, have a material adverse effect on our business, results of operations, financial condition, or cash flows.

Future litigation may be necessary to defend ourselves, our partners, and our customers by determining the scope, enforceability, and validity of third-party proprietary rights, or to establish our proprietary rights.

3 unchanged sentences

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/A

Item 3. Legal Proceedings