Planet Labs PBCPL
Planet Labs PBC Debt Disclosure
Debt, Convertible Notes, and Warrants
Venture Loans
In November 2014, the Company entered into a secured term loan agreement with Venture Lending & Leasing, Inc. (“Venture”), an affiliate of Western Technology Investment, for a $25.0 million loan. The Company drew the full amount under the loan agreement, which was fully repaid in March 2019. In connection with the loan, the Company issued warrants to Venture for the purchase of up to 761,340 shares of Series B convertible preferred stock which were exercisable at any time until March 1, 2025, unless all other preferred stock issued by the Company had been converted into common stock, in which case the warrants automatically converted into common stock at a price not less than $9.3844 per share. In connection with the Business Combination (see Note 3), the Series B convertible preferred stock warrants discussed above converted into warrants for Class A common stock and were exercised on a cashless basis resulting in the issuance of 761,340 shares of Class A common stock.
In May 2017, the Company entered into two additional secured term loan agreements (the “2017 Loans”) with Venture for loan amounts of $25.0 million each. Each loan bore an interest rate of 11.0% per annum. The Company drew down a total of $25.0 million of the 2017 Loans in May 2017 which were set to mature in November 2021, with the remaining $25.0 million drawn down in February 2018 which was set to mature in August 2022.
In connection with the 2017 Loans, the Company issued warrants to Venture for the purchase of up to a total of 745,914 shares of Series D convertible preferred stock for the loan amounts drawn in 2018 and 2017. The warrants were exercisable by Venture at any time until April 1, 2028, unless all other preferred stock issued by the Company had been converted into common stock, in which case the warrants automatically converted into common stock at a price not less than $9.3844 per share. Venture was also able to exercise the warrants on a cashless or “net issuance” basis in return for a reduced preferred stock allocation. In connection with the Business Combination (see Note 3), the Series D convertible preferred stock warrants were converted into warrants for Class A common stock and were exercised on a cashless basis, resulting in the issuance of 745,914 shares of Class A common stock.
On June 21, 2019, the Company amended the 2017 Loans (the “Amendment”), bifurcating the loans into two tranches: Tranche A, in an amount of $49.0 million, representing the remaining principal amount of the 2017 Loans; and Tranche B, in an amount of $8.6 million, representing the 2017 Loans prepayment penalty. Tranche A was paid in full upon the execution of the Amendment. Tranche B, consisting of two separate subordinated contract liability instruments of $4.3 million each, remained outstanding.
The Tranche B loans bore no interest, had no maturity date or prepayment schedule, and were subordinate to SVB & Hercules Loan (defined below) for any enforcement of a security interest or lien. At the option of the lenders, the Tranche B loans were convertible into Series D convertible preferred stock at any time. In addition, the Tranche B loans included conversion features conditioned on future rounds of preferred equity financing, and bridge financing. The Tranche B loans were due and payable in full upon an Acceleration Event (as defined in the Tranche B loans) and included optional prepayment and conversion features contingent upon an additional debt issuance by the Company. The Company elected to apply the fair value option to the outstanding Tranche B loans. The loans were classified as a current liability and were measured at a fair value of $10.9 million at issuance. Changes in fair value were subsequently recognized in the consolidated statements of operations and comprehensive loss.
In July 2021, the Company amended certain terms of the Tranche B loans and certain terms of the warrants issued to Venture to provide for, among other things, (i) an amendment to the definition of an initial public offering to include the acquisition of the Company by a SPAC, (ii) immediately prior to the consummation of an initial public offering, the automatic conversion of the outstanding principal under the notes into bridge financing securities and (iii) immediately prior to the consummation of an initial public offering, the automatic exchange of the warrants for shares of the Company securities. The amended terms of the Venture Tranche B loans were not considered substantially different than the original terms of such loans. As such, the Tranche B loans continued to be recognized at fair value pursuant to the fair value option.
In connection with the Business Combination (see Note 3), the Tranche B loans converted into 754,378 shares of the Company’s Class A common stock, therefore there were no loan amounts outstanding as of January 31, 2024 or 2023.
SVB & Hercules Loan
On June 21, 2019, the Company entered into a Credit Agreement with SVB and Hercules for a $50.0 million secured loan with an interest rate of 11.0% per annum (the prime rate plus 5.5%, minimum of 11.0%), with a maturity date of June 21, 2022, or 91 days prior to the maturity date of the 2020 Convertible Notes, described below, if the outstanding 2020 Convertible Notes have not been converted into equity securities. With the proceeds, the Company paid back its Venture Tranche A of the 2017 Loans, amounting to $49.0 million. In connection with the loan, the Company issued warrants to the lenders and their affiliates for the purchase of 1,049,801 shares of the Company’s Class A common stock with an exercise price of $0.00001 per share, expiring in June 2029. The loan required the Company to make interest-only payments through the maturity date of June 21, 2022.
The Company incurred $0.3 million of loan fees associated with its entry into the agreement and accrued $1.5 million of final loan fees payable upon maturity. The proceeds of debt issuance were allocated between debt and the warrants based on their relative fair value. The difference between debt proceeds and the amount of those proceeds allocated to debt gave rise to a debt discount of $4.2 million. The discount amount due to the warrant of
$4.2 million along with the total loan fees of $1.8 million was being amortized as interest expense through maturity using the effective interest method.
On June 5, 2020, the Company obtained an additional $15.0 million secured loan from SVB and Hercules. The loan bore an interest rate of 11.0% per annum with a maturity date of June 21, 2022, or 91 days prior to the maturity date of the 2020 Convertible Notes, described below, if the outstanding 2020 Convertible Notes have not been converted into equity securities. With the proceeds, the Company paid back $2.6 million, or 30.0% of the face value of its Venture Tranche B loans. In connection with the loan, the Company issued warrants to the lenders and their affiliates for the purchase 384,155 shares of Class A common stock of the Company with an expiration date of June 2030.
The proceeds of debt issuance were allocated between debt and the warrants based on their relative fair value. The difference between debt proceeds and the amount of those proceeds allocated to debt gave rise to a debt discount of $1.6 million. The discount amount due to the warrant of $1.6 million along with the total loan fees of $0.6 million was being amortized as interest expense through maturity using the effective interest method.
In connection with the Business Combination (see Note 3), the outstanding principal, accrued interest and repayment fees of $67.1 million relating to the credit agreement with SVB and Hercules was repaid. As a result of the repayment, the Company recognized a debt extinguishment loss of $1.7 million during the fiscal year ended January 31, 2022. There were no loan amounts outstanding as of January 31, 2024 or 2023.
During the fiscal year ended January 31, 2022, the Class A common stock warrants discussed above were exercised on a net-basis resulting in the issuance of 1,433,567 shares of Class A common stock.
2020 Convertible Notes
During the fiscal year ended January 31, 2021, the Company entered into a Convertible Note and Warrant Purchase Agreement with certain investors, pursuant to which it issued convertible promissory notes (the “2020 Convertible Notes”). The 2020 Convertible Notes bore interest at a rate of 6% per annum, that compounded quarterly and had a June 22, 2022 maturity date. The principal amount of the 2020 Convertible Notes issued is $71.1 million in the aggregate. The Company issued warrants for the purchase of Series D convertible preferred stock, equal to 20% of the original principal amount of the notes, with an exercise price of $9.3844. The warrants expire on the tenth anniversary of the date of issuance. The number of shares of Series D convertible preferred stock issuable under the warrants is 1,515,799 in aggregate.
The 2020 Convertible Notes contained an automatic conversion features in the event of the closing of the Company’s next sale of preferred stock occurring on or prior to the 2020 Convertible Notes’ maturity date resulting in gross proceeds in excess of at least $75.0 million, (the “Next Equity Financing”), and an optional conversion feature upon an equity financing by the Company which does not constitute a Next Equity Financing (a “Non-Qualified Financing Conversion”).
The Company elected to apply the fair value option to the outstanding 2020 Convertible Notes. As such, the 2020 Convertible Notes were recognized at fair value with changes in fair value recognized in the consolidated statements of operations and comprehensive loss.
In July 2021, the Company amended certain terms of its 2020 Convertible Notes to provide for, among other things, the automatic conversion of the outstanding principal and accrued interest under the notes into shares of common stock immediately prior to the Business Combination. The amended terms of the 2020 Convertible Notes were not considered substantially different than the original terms of such notes. As such, the 2020 Convertible Notes continued to be recognized at fair value pursuant to the fair value option.
In connection with the Business Combination (see Note 3), the 2020 Convertible Notes converted into 9,824,143 shares of the Company’s Class A Common Stock, therefore there were no 2020 Convertible Notes outstanding as of January 31, 2024 or 2023.
In connection with the Business Combination (see Note 3), 450,205 of the Series D convertible preferred stock warrants discussed above converted into warrants for Class A common stock and were exercised on a cashless basis, resulting in the issuance of 27,713 shares of Class A common stock. The remaining 1,065,594 Series D convertible preferred stock warrants that were not exercised converted into warrants for Class A common stock shares and remained outstanding as of January 31, 2024 and 2023.
The following table presents the interest expense related to the contractual interest coupon, the amortization of debt issuance costs, the amortization of debt discounts and loss on extinguishment of debt:
Year Ended January 31, | |||||||||||||||||
| (in thousands) | 2024 | 2023 | 2022 | ||||||||||||||
| Contractual interest coupon | $ | — | $ | — | $ | 6,137 | |||||||||||
| Amortization of debt issuance costs | — | — | 768 | ||||||||||||||
| Amortization of debt discounts | — | — | 1,867 | ||||||||||||||
Debt extinguishment loss | — | — | 1,690 | ||||||||||||||
Total interest expense and extinguishment loss | $ | — | $ | — | $ | 10,462 | |||||||||||
A summary of warrants that remain outstanding as of January 31, 2024 in connection with the above transactions is as follows:
Number of Warrants Outstanding | Number of Warrants Exercisable | Weighted Average Exercise Price | Weighted Average Remaining Term (in Years) | ||||||||||||||||||||
| Warrants to purchase Class A Common Stock | 1,065,594 | 1,065,594 | $9.3844 | 6.2 | |||||||||||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2024 | Mar 29, 2024 | Showing above |
| 2023 | Mar 30, 2023 | |
| 2022 | Apr 14, 2022 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.