AST SpaceMobile CEO Publishes Letter To Shareholders

Author: Benzinga Newsdesk | January 23, 2024 12:35pm

AST SpaceMobile, Inc. ("AST SpaceMobile") (NASDAQ:ASTS), the company building the first and only space-based cellular broadband network accessible directly by everyday smartphones, today announced that Abel Avellan, Chairman and Chief Executive Officer of AST SpaceMobile, published a letter to shareholders. The full text of the letter is below.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20240123933920/en/

Dear Fellow Shareholders,

Last week's announcement of strategic investments from AT&T, Google and Vodafone and aggregate new financing of up to $306.5 million in gross proceeds, represents a major leap forward for AST SpaceMobile, not only providing new incremental capital, but perhaps more importantly defining the path forward for the company strategically and commercially.

The right long-term partners

AST SpaceMobile, the only company that has proven technology to deliver cellular broadband connectivity directly from space to your everyday smartphones, is now supported by global leaders in the wireless ecosystem.

• Being able to announce investment by AT&T, Google and Vodafone is humbling and a true testament to the company's achievements, and the opportunity ahead of us.
• AT&T and Google join existing strategic investors Vodafone, Rakuten, American Tower and Bell Canada, industry leaders own over 20% of AST SpaceMobile (on a fully-diluted economic basis). The support from these leaders, alongside the 40+ mobile network operators with whom we have agreements and understandings and who have over 2 billion subscribers around the world, is necessary for us to achieve our mission.
• Commercial revenue secured with AT&T and with Vodafone (subject to a definitive agreement), and anticipated government related revenues should enable AST SpaceMobile to attract long term, low-cost quasi-governmental funding.
• Google and AST SpaceMobile agreed to collaborate on product development, testing and implementation plans for SpaceMobile network connectivity on its Android and related devices.
• Lastly, we continue to advance discussions with additional strategic partners, following the blueprint of commercial payments alongside commercial agreements.

The right strategic and commercial investment model

• The largest piece of capital raised last week was 10-year subordinated convertible notes with 5.50% interest (which may be paid in kind), with a conversion price of $5.75 per share.
• AT&T and Vodafone, two of our prospective top customers, are not only investing in AST SpaceMobile, but also making $45.0 million of non-dilutive commercial payments (subject to conditions) on non-dilutive commercial payments and purchasing network equipment, actions which actively shape our commercial and go-to-market strategy and provide a structure for us to bring other customers onto the SpaceMobile network.
• Lastly, while these first commercial payments represent only a small portion of the revenue opportunity in front of us, we believe they are helpful tools for jump-starting the service and efficiently funding the company.

The right amount of capital to support the commercial roll out

• With our first five commercial satellites fully-funded, last year we turned our attention to building and launching the next-generation BlueBirds, which are designed for a 10x improvement in throughput.
• The series of simultaneous deals announced last week reflected our decision that $300 million was the right amount of capital to bring all together at once.
• Altogether, we announced up to $306.5 million in aggregate gross proceeds, including convertible notes, non-dilutive commercial payments, common equity and a planned future draw on the company's existing credit facility.
• With our new incremental cash, we continue to maintain momentum and we are also well positioned to finance AST SpaceMobile efficiently for shareholders.

Let's keep making history together

• I am confident that, over the long term, the value of our technology, our strategy, and our partner ecosystem will be fully recognized and realized.
• I, along with all of the members of the AST SpaceMobile board of directors and management team, could not be more excited for the future of space-based communications, and we are excited to be the team leading the first and only space-based cellular broadband network.
• Let's keep it up to achieve our mission of connecting the unconnected!

Sincerely,

Abel Avellan

Chairman and Chief Executive Officer

AST SpaceMobile

Posted In: ASTS