Anterix Inc. (ATEX) 2022年年度報告「NASDAQ」.pdf

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1、UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549_FORM 10-K _(Mark one)ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended March 31,2022OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 193

2、4For the transition period from to Commission file number:001-36827_Anterix Inc.(Exact name of registrant as specified in its charter)_Delaware 33-0745043(State or other jurisdiction ofincorporation or organization)(I.R.S.EmployerIdentification No.)3 Garret Mountain Plaza 07424Suite 401Woodland Park

3、,New Jersey(Address of principal executive offices)(Zip Code)(973)771-0300(Registrants telephone number,including area code)_Securities registered pursuant to Section 12(b)of the Act:Title of each classTrading symbolName of each exchange on which registeredCommon Stock,$0.0001 par valueATEXThe Nasda

4、q Stock Market LLC(Nasdaq Capital Market)Securities registered pursuant to Section 12(g)of the Act:None.Indicate by check mark if the registrant is a well-known seasoned issuer,as defined Rule 405 of the Securities Act.Yes NoIndicate by check mark if the registrant is not required to file reports pu

5、rsuant to Section 13 or Section 15(d)of the Act.Yes NoIndicate by check mark whether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 during the preceding 12months(or for such shorter period that the registrant was required to f

6、ile such reports),and(2)has been subject to such filing requirements for the past 90days.Yes NoIndicate by check mark whether the registrant has submitted electronically,every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T(232.405 of this chapter)during the pre

7、ceding 12 months(or for such shorter period that the registrant was required to submit such files).Yes NoIndicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,smaller reporting company,or an emerging growthcompany.See the definitions

8、of“large accelerated filer,”“accelerated filer,”“smaller reporting company,”and“emerging growth company”in Rule 12b-2 of the Exchange Act.Large accelerated filerAccelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company,indicate by check m

9、ark if the registrant has elected not to use the extended transition period for complying with any new or revised financialaccounting standards provided pursuant to Section 13(a)of the Exchange Act.Indicate by check mark whether the registrant has filed a report on the attestation to its managements

10、 assessment of the effectiveness of its internal control over financialreporting under Section 404(b)of the Sarbanes-Oxley Act(15 U.S.C.7262(b)by the registered public accounting firm that prepared or issued its audit report.Indicate by check mark whether the registrant is a shell company(as defined

11、 in Rule 12b-2 of the Exchange Act).Yes NoThe aggregate market value of the registrants voting common stock held by non-affiliates of the registrant based on the closing stock price of its common stock on the NasdaqCapital Market on the last business day of its most recently completed second fiscal

12、quarter,September 30,2021,was$775,403,925.For purposes of this computation only,allexecutive officers,directors and 10%or greater stockholders have been deemed affiliates of the registrant.As of May 24,2022,18,933,986 shares of the registrants common stock were outstanding.DOCUMENTS INCORPORATED BY

13、REFERENCEPortions of the registrants definitive proxy statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A in connection with the registrants2022 Annual Meeting of Stockholders,which will be filed subsequent to the date hereof,are incorporated by reference int

14、o Part III of this Form 10-K where indicated.Suchdefinitive proxy statement will be filed with the Securities and Exchange Commission not later than 120 days following the end of the registrants fiscal year ended March 31,2022.Anterix Inc.FORM 10-KFor the fiscal year ended March 31,2022 TABLE OF CON

15、TENTS PART I.Item 1.Business3Item 1A.Risk Factors17Item 1B.Unresolved Staff Comments29Item 2.Properties29Item 3.Legal Proceedings29Item 4.Mine Safety Disclosures29PART II.Item 5.Market for Registrants Common Equity,Related Stockholder Matters and Issuer Purchases of Equity Securities30Item 6.Reserve

16、d31Item 7.Managements Discussion and Analysis of Financial Condition and Results of Operations32Item 7A.Quantitative and Qualitative Disclosures about Market Risk39Item 8.Financial Statements and Supplementary Data39Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Dis

17、closure39Item 9A.Controls and Procedures39Item 9B.Other Information41Item 9C.Disclosure Regarding Foreign Jurisdictions that Prevent Inspections41PART III.Item 10.Directors,Executive Officers and Corporate Governance42Item 11.Executive Compensation42Item 12.Security Ownership of Certain Beneficial O

18、wners and Management and Related Stockholder Matters42Item 13.Certain Relationships and Related Transactions and Director Independence42Item 14.Principal Accountant Fees and Services42PART IV.Item 15.Exhibits and Financial Statement Schedules43Item 16.Form 10-K Summary46SIGNATURES47Glossary of Selec

19、ted TermsUnless otherwise noted or indicated by context,the following selected terms used in this Annual Report on Form 10-K have the following meanings:240 Channels:Equals 6 MHz of 900 MHz spectrum whether the individual 25 kHz channels are scattered throughout the 5x5/10 MHz 900 MHz bandor are con

20、tained within the contiguous 3x3/6 MHz broadband segment created by the Report and Order.3x3 or 6 MHz:The broadband segment of the 900 MHz band(897.5-900.5/936.5-939.5)is authorized for a total of 6 MHz of spectrum,with 3MHz designated for uplink transmissions and 3 MHz for downlink transmissions.5x

21、5 or 10 MHz:The 900 MHz band(896-901/935-940)is authorized for a total of 10 MHz of spectrum,with 5 MHz designated for uplinktransmissions and 5 MHz for downlink transmissions.600 MHz Auction:The FCCs 2016“incentive auction”in which licensees of television broadcast channels were incentivized to rel

22、inquish theirspectrum for defined payments so the spectrum could be repurposed for licensed wireless services.900 MHz:The 900 MHz band frequency ranges between 896-901/935-940.900 MHz Broadband Spectrum:The 900 MHz band authorized for broadband(897.5-900.5/936.5-939.5).Anti-Windfall Payment:A paymen

23、t to the U.S.Treasury from a 900 MHz broadband applicant for any full or fractional MHz less than six MHz ifthe applicant relinquishes less than 6 MHz(or 240 channels)of spectrum with the amount of the payment based on the per MHz-pop 600 MHz forward auctionprices for the Partial Economic Area in wh

24、ich the county applied for by the broadband applicant is included.B/ILT:Systems operated by,or spectrum licensed for,private land mobile use by business users.Complex System:As defined in the Report and Order,a Covered Incumbents system that consists of 45 or more functionally integrated sites as of

25、August 17,2020,when the new rules became effective.Covered Incumbent:Any 900 MHz site-based licensee in the broadband segment that is required under section 90.621(b)to be protected by abroadband licensee with a base station at any location within the county,or any 900 MHz geographic-based SMR licen

26、see in the broadband segment whoselicense area completely or partially overlaps the county.Eligibility Certification:A document filed as part of the broadband application that lists the licenses the applicant holds in the 900 MHz band todemonstrate that it holds the licenses for more than 50%of the

27、total licensed 900 MHz spectrum for the relevant county,including credit for spectrum includedin an application to acquire any covered incumbents filed on or after March 14,2019(i.e.,the 50%Licensed Spectrum Test)and to demonstrate that is holdsthe licenses for more than 90%of the total licensed 900

28、 MHz spectrum in the broadband segment in a particular county and within 70 miles of the countysboundaries,including credit for spectrum included in a contract to acquire,relocate or protect any covered incumbents or application filed on or after March14,2019(i.e.,the 90%Broadband Spectrum Test).FCC

29、 Form 601:FCC Application used for Wireless Telecommunications Bureau Radio Service Authorizations such as a 900 MHz broadbandlicense.Licensed Channel:Any of the 399 25 kHz narrowband 900 MHz channels for which the FCC has issued a license to an entity.Some channels in the900 MHz band remain in the

30、FCC inventory.Mandatory Retuning:A process by which a broadband licensee can mandatorily relocate a Covered Incumbent to channels outside of the broadbandsegment if the replacement channels provide comparable facilities to the Covered Incumbents existing system and the broadband applicant pays all r

31、easonableretuning costs.MTA:Major Trading Area;service areas based on the Rand McNally 1992 Commercial Atlas&Marketing Guide,that define 900 MHz SMRgeographic licenses.Narrowband Channel:A 900 MHz 25 kHz bandwidth channel.Railroads:The freight railroads that,through the AAR,hold an effectively natio

32、nwide license for six non-contiguous 900 MHz channels,three ofwhich are in the broadband segment.Retuning:Modifying a Covered Incumbents narrowband system to operate on channels outside the broadband segment established by the Report andOrder.Swapping:Exchanging narrowband channels outside the broad

33、band segment for the broadband segment channels held by a Covered Incumbent.Transition Plan:A document filed as part of the broadband application that demonstrates that the applicant holds or has agreements to acquire,relocate or protect at least 90%of the licensed channels in the Broadband Segment

34、of Covered Incumbents in or within 70 miles of the county(i.e.,the 90%Broadband Segment Test).Table of ContentsCAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTSVarious statements contained in this Annual Report on Form 10-K(the“Annual Report”),including those that express a belief,expectati

35、on,orintention,as well as those that are not statements of historical fact,are forward-looking statements.Our forward-looking statements are generally,but notalways,accompanied by words such as,but not limited to,“aim,”“anticipate,”“believe,”“can,”“continue,”“could,”“estimate,”“expect,”“goal,”“inten

36、d”“may,”“might,”“ongoing,”“plan,”“possible,”“predict,”“project,”“potential,”“seek,”“should,”“strategy,”“target,”“will,”“would”and similarexpressions or phrases,or the negative of those expressions or phrases,or other words that convey the uncertainty of future events or outcomes,which areintended to

37、 identify forward-looking statements,although not all forward-looking statements contain these identifying words.We have based these forward-looking statements on our current expectations and projections and related assumptions,about future events and financial trends.While our managementconsiders t

38、hese expectations,projections and assumptions to be reasonable,they are inherently subject to significant business,economic,competitive,regulatory and other risks,contingencies and uncertainties,most of which are difficult to predict and many of which are beyond our control.There can be noassurance

39、that actual developments will be as we anticipate.Actual results may differ materially from those expressed or implied in these statements as a resultof significant risks and uncertainties,including,but not limited to:our ability to qualify for and obtain broadband licenses from the Federal Communic

40、ations Commission(the“FCC”)in accordance with therequirements of the Report and Order approved by the FCC on May 13,2020(the“Report and Order”);our ability to successfully commercialize our spectrum assets to our targeted utility and critical infrastructure customers on a timely basis and oncommerci

41、ally favorable terms,including our ability to lease our spectrum on financial terms consistent with our business plan and assumptions;our ability to correctly estimate our operating expenses and future revenues;our ability to support our future operations and business plans and return capital to our

42、 stockholders through our share repurchase program with ourexisting cash resources and the proceeds we generate from our commercial operations without the need to raise additional capital through theissuance of stock or debt securities;the extent and duration of the impact of the COVID-19 pandemic o

43、n our business,results of operations,stock price,or overall financial condition;our ability to retune or relocate incumbent narrowband licensees in a timely manner and on commercially reasonable terms,or at all;our ability to satisfy our obligations,including the delivery of cleared spectrum and bro

44、adband licenses,and the other contingencies required by ourcommercial agreements with Ameren Corporation(“Ameren”),San Diego Gas&Electric Company,a subsidiary of Sempra Energy(“SDG&E”),and Evergy Services,Inc.(“Evergy”)on a timely basis and on commercially reasonable terms;whether federal and state

45、agencies and commissions will support the deployment of broadband networks and services by our targeted customers;our ability to maintain any narrowband and broadband licenses that we own and/or obtain from the FCC;government regulations or actions taken by governmental bodies could adversely affect

46、 our business prospects,liquidity and results of operations,including any changes by the FCC to the Report and Order or to the FCC rules and regulations governing the 900 MHz band;our ability to successfully compete against the third parties who offer spectrum and communication technologies,products

47、 and solutions to ourtargeted customers;our ability to successfully manage our planned growth;the ability to develop and sustain a robust market for our common stock;factors that may cause our common stock price to be volatile or cause the value of our common stock to decline;the expected timing and

48、 amount of purchases and the related impact to our common stock relating to our share repurchase program;andhow the concentrated ownership of our common stock may limit stockholders ability to influence corporate matters.These and other important factors,including those discussed under“Item 1.Busine

49、ss,”“Item 1A.Risk Factors”and“Item 7.ManagementsDiscussion and Analysis of Financial Condition and Results of Operations”within this Annual Report may cause our actual results,performance orachievements to differ materially from any future results,performance or achievements expressed or implied by

50、these forward-looking statements.Therefore,you are cautioned not to place undue reliance on such statements.Further,any forward-looking statement speaks only as of the date on which it is made,andexcept to the extent required by applicable law,we undertake no obligation to update any forward-looking

51、 statement to reflect events or circumstances after thedate on which the statement is made or to reflect the occurrence of unanticipated events,whether as a result of new information,future events or otherwise.Page 1Table of ContentsSUMMARY OF RISK FACTORSWe have prepared the following summary of th

52、e principal risks to our business and the risks associated with ownership of our common stock.Thissummary does not address all of the risks that we face.We encourage you to carefully review the full risk factors contained in this Annual Report in theirentirety for additional information regarding th

53、e material factors that make an investment in our securities speculative or risky.These risks and uncertaintiesinclude,but are not limited to,the following:our plans to commercialize our 900 MHz spectrum assets depend on our ability to qualify for and obtain broadband licenses from the FCC inaccorda

54、nce with the requirements of the Report and Order;the clearing process established by the FCC in the Report and Order,which exempts complex systems from mandatory retuning,may not allow usto retune or relocate some incumbents in a timely manner and on commercially reasonable terms,or at all;we may n

55、ot be able to qualify for and utilize the Mandatory Retuning process established by the Report and Order to clear incumbents;we may not be successful in commercializing our spectrum assets to our targeted utility and critical infrastructure customers,on a timely basis,onfavorable terms or in accorda

56、nce with our business plans and expectations;we are subject to contingencies and obligations under our commercial agreements with Ameren,SDG&E,and Evergy,including the delivery ofcleared spectrum and broadband licenses on a timely basis,and as a result,there is no assurance that we will receive paym

57、ents from Ameren and/orSDG&E in the amounts and on the timeline we currently expect,or that any payments we have received to date will not be subject to repayment,orthat we will not be subject to contract claims,including rights of termination;the COVID-19 pandemic has disrupted and could continue t

58、o adversely impact our business,including our broadband licensing andcommercialization efforts and our financial condition,liquidity and results of operations;we have limited operating history with our current business plan,which makes it difficult to evaluate our prospects and future financial resu

59、lts andour business activities,strategic approaches and plans may not be successful;our initiatives with the federal and state agencies and commissions that regulate electric utilities may not be successful;we may not be able to maintain any broadband licenses that we own and/or obtain from the FCC;

60、government regulations or actions taken by governmental bodies could adversely affect our business prospects,liquidity and results of operations,including any changes by the FCC to the Report and Order or to the FCC rules and regulations governing the 900 MHz band;the value of our spectrum assets ma

61、y fluctuate significantly based on supply and demand,as well as technical and regulatory changes;we may not generate funds through our commercialization operations as planned or correctly estimate our operating expenses or future revenues,which could lead to cash shortfalls,and may prevent us from r

62、eturning capital to our stockholders and require us to secure additional financing;many of the third parties who offer spectrum and communication technologies,products and solutions to our targeted customers have existing long-term relationships with these targeted customers and have significantly m

63、ore resources and greater political and regulatory influence than we do,and we may not be able to successfully compete with these third parties;if we are unable to attract new customers,our results of operations and our business will be adversely affected;we have had net losses each year since our i

64、nception and may not achieve or maintain profitability in the future;we will need to continue to expand our organization and we may experience difficulties in managing this growth,which could disrupt our operationsand financial results;there is no assurance that a robust market in our common stock w

65、ill develop or be sustained;our common stock prices may be volatile which could cause the value of our common stock to decline;the expected timing and amount of purchases and the related impact to our common stock relating to our share repurchase program;concentration of ownership will limit our sto

66、ckholders ability to influence corporate matters;andadverse market conditions,including as the result of wars and inflation,may adversely affect our business and our commercialization efforts.Page 2Table of ContentsPART I.Item 1.Business OverviewAnterix Inc(“Anterix,”“we,”“our,”or the“Company”)is a

67、wireless communications company focused on commercializing our spectrum assets toenable our targeted utility and critical infrastructure customers to deploy private broadband networks,technologies and solutions.We are the largest holder oflicensed spectrum in the 900 MHz band(896-901/935-940 MHz)wit

68、h nationwide coverage throughout the contiguous United States,Hawaii,Alaska andPuerto Rico.On May 13,2020,the FCC made a historic approval of the Report and Order to modernize and realign the 900 MHz band to increase its usabilityand capacity by allowing it to be utilized for the deployment of broad

69、band networks,technologies and solutions.The Report and Order was published in theFederal Register on July 16,2020,and became effective on August 17,2020.We are now engaged in qualifying for and securing broadband licenses from theFCC.At the same time,we are actively pursuing opportunities to lease

70、the broadband spectrum we secure to our targeted utility and critical infrastructurecustomers.Our Spectrum AssetsOur spectrum is our most valuable asset.We own licenses nationwide,including on average,approximately 66%of the 399 channels in the 900 MHzband in the top 20 metropolitan market areas in

71、the United States,which cover approximately 38%of the U.S.population.We acquired the majority of our 900MHz spectrum and certain related equipment from Sprint in September 2014 for$100 million,which we paid in the form of$90 million in cash and$10million in shares of our common stock.In the 900 MHz

72、band,the FCC historically allocated approximately 10 MHz of spectrum,sub-divided into 40 10-channel blocks(for a total of 399contiguous channels)alternating between blocks designated for the operation of Specialized Mobile Radio(“SMR”)commercial systems and blocks designatedfor B/ILT,with the FCCs r

73、ules also enabling B/ILT licenses to be converted to SMR use.Subsequently,the FCC conducted overlay auctions on the SMRdesignated blocks that awarded geographic-based licenses on a Major Trading Area(“MTA”)basis while affording operational protection to incumbent,site-based licensees in those areas.

74、Certain MTA licenses were not purchased at auction or have been returned to the FCC.In addition,the FCC never auctioned the20 blocks of B/ILT spectrum in some parts of the United States,therefore no users acquired site-based licenses utilizing this spectrum.As a result,the FCC iscurrently holding li

75、mited 900 MHz narrowband spectrum in its inventory in most counties throughout the United States.Broadband licensesDuring the year ended March 31,2022,we applied for,and were granted by the FCC,broadband licenses for 21 counties.As a result,we relinquishedto the FCC our narrowband licenses and made

76、the necessary Anti-Windfall payments for the same 21 counties as required by the Report and Order.Our Business StrategyOur mission is to deliver transformative broadband to enable the modernization of utilities and other critical infrastructure sectors through the powerof private wireless connectivi

77、ty on 900 MHz spectrum.To that end,we are pursuing a two-pronged strategy focused on:1)converting our nationwidenarrowband 900 MHz spectrum position into valuable broadband spectrum;and 2)adoption of our principal commercial business offering,the long-termleasing of our broadband spectrum by utility

78、 and critical infrastructure enterprises nationwide.Converting our Nationwide Narrowband 900 MHz Spectrum Position to Broadband Converting our spectrum from narrowband to broadband licenses nationwide is a foundational component of our two-pronged strategy as it providesthe platform for growing our

79、business.To achieve this conversion,we are focused on intentionally clearing incumbents out of the broadband license segmentand obtaining broadband licenses in those counties in which we have customer contracts,where we believe we have near-term commercial prospects,or wemay be strategically advanta

80、geous to achieve optimum costs for broadband licenses over time.Secure Broadband Licenses In the Report and Order,the FCC chose to make counties the“base unit of measure”for calculating whether an entity is eligible to hold a broadbandlicense.As a result of this decision and our extensive accumulate

81、d spectrum holdings,Anterixand only Anterixis an essential party in every one of thenations 3,233 counties.And while we intend to continue to prioritize our spectrum transactions in areas where we have customer opportunities,we also plan topursue spectrum transactions opportunistically to recognize

82、a positive return on our investments in spectrum clearing costs.We have been proactive in thiseffort and to date have completed,and intend to continue to pursue,spectrum transactions to support our efforts to satisfy the broadband license eligibilityrequirements.Page 3Table of ContentsClear Covered

83、Incumbents In anticipation of the efforts required to secure broadband licenses,we have been proactive in our clearing efforts in preparation for the broadbandlicensing process.Our dedicated clearing teams are focused on negotiating agreements to move Covered Incumbents from the recently allocated b

84、roadbandsegment of the 900 MHz spectrum band to the segments allocated for continued narrowband operations within the 900 MHz band or out of 900 MHz bandentirely.Our team has established contact with nearly all of the Covered Incumbents throughout the country.Deploying our Commercial Business Offeri

85、ngWith the Report and Order issued,paving the way for the deployment of broadband in the 900 MHz band,the second key prong of our strategy isestablishing our commercial positioning and accelerating adoption of our principal commercial business offering.We are implementing this strategy throughtarget

86、ed outreach and education by our sales and marketing organization,by participating in the Utilities Broadband Alliance(“UBBA”)and attracting vendorsto the Anterix Active Ecosystem Program(“AAEP”).UBBA membership includes twelve electric utilities among its nearly sixty members.AAEP currently has80 l

87、eading technology companies that will provide deployment and application solutions for private broadband among our Nations electric grid innovators.Werecently launched the AAEP to foster,strengthen,and expand the landscape of 900 MHz devices,services and solutions.Participation from the broad range

88、oftechnology innovators will bring extensive value to utilities and other critical infrastructure providers who deploy private LTE(“PLTE”).The primary intent ofour business is to lease the broadband licenses we secure to customers for long term leases(generally 20 years or longer),and additional lon

89、g-term renewaloptions.Based upon our analysis and discussions with potential customers to date,we are seeing strong initial demand.To fulfill our business offering,we willbe responsible for the costs of securing the broadband licenses from the FCC,including the costs of clearing and acquiring suffic

90、ient spectrum to meet thebroadband requirements.By contrast,we expect that most of our customers will bear the costs of deploying and operating their private broadband networks,technologies andsolutions.And,beyond our principal commercial business offering,we are also exploring opportunities to offe

91、r our prospective customers additional low-capital intensive,value-added services to support their network deployments and operations.Accordingly,our approach to driving the second key prong of our strategy includes:1)advancing our potential customers through the pipeline byassisting them with their

92、 decisions and evaluation process of private wireless networks;2)encouraging federal and state agencies to support the investment anddeployment of private LTE solutions in the 900 MHz band by utilities and critical infrastructure companies;3)participating in demonstrations and tests withlaboratories

93、 such as National Renewable Energy Lab(“NREL”)and National Institute of Standards and Technology(“NIST”);4)developing expanded value-added business offerings;5)enabling and growing the AAEP;6)participating in UBBA and other relevant industry associations to promote our solution;and 7)continually eva

94、luating potential opportunities to expand the application of private wireless broadband networks built on 900 MHz.Continue to Build the Customer PipelineOur sales and support teams are actively working with many of the largest Investor Owned Utilities(“IOU”).More specifically,these teams areworking

95、in coordination with representatives from our target customers,LTE infrastructure vendors,end-user device manufacturers,system integrators andother technology companies in addition to responding to Requests for Information(“RFIs”),Requests for Proposals(“RFPs”)and requests to supporttechnology trial

96、s related to using our 900 MHz spectrum for broadband services.To date,there have been eight experimental licenses granted to IOUs or theirsubsidiaries,an additional three experimental licenses to other utilities and five more experimental licenses to vendors and labs to showcase and promote 900MHz

97、broadband.Build Support with Federal and State Agencies Our targeted critical infrastructure customers are highly regulated by both federal and state agencies.Electrical utilities,for example,may be regulatedby the Federal Energy Regulatory Commission,the Public Utilities Commissions within the stat

98、es they serve and/or other state and municipal governance orregulatory bodies.Other agencies that guide utility regulations include the Department of Energy,the Department of Homeland Security,and NIST.We areworking with each of these agencies to educate them about the security,reliability and prior

99、ity access benefits that private broadband LTE networks,technologies and solutions can offer to utilities.We are also working with a number of state agencies and commissions who regulate electrical utilities,andhave a strong influence over electric utility buying decisions.Our goal with these state

100、agencies and commissions is to gain their support,with an eye towardallowing utilities to include the costs of leasing of our spectrum assets and deploying private broadband LTE networks,technologies and solutions into theirrespective rate bases.Utility control of communications for grid modernizati

101、on programs enhances their ability to provide safe,reliable,resilient and costeffective electricity for the ratepayers.If included in rate bases,this could allow utilities to recover that investment and earn a customary rate of return on thoseprudent investments.Page 4Table of ContentsDevelop a Road

102、map for Expanded Services Through our day-to-day interactions with prospective utility and critical infrastructure customers,and our responses and subsequent discussionsrelated to RFIs and RFPs,we have identified additional areas of opportunity to support our prospective customers in the implementat

103、ion and operation of PLTEnetworks.We are performing due diligence to determine how best to meet these customer needs,including using our internal expertise,collaborating withstrategic partners and working with specific service providers.Enable the Anterix Active Ecosystem with U.S.Band 8 Our spectru

104、m assets are located in the international 3GPP global standard Band 8 channel which is a frequency duplex(“FDD”)pair assigned to the880-915/925-960 MHz spectrum bands.This pairing is aligned for use with both 4G and 5G technologies and is currently being utilized with commercialLTE and 5G broadband

105、networks globally in Asia,Europe,and other parts of the world.Our efforts are ongoing to facilitate continued adoption of 900 MHzBand 8 radio access network(“RAN”)equipment and end-user devices in the U.S.by working with chipmakers and module and device vendors to help ensurethat customers who emplo

106、y 900MHz for PLTE have timely access to 3GPP standards-compliant Band 8 devices that meet the technical operating specificationsestablished in the FCCs Report and Order.We also worked with an FCC certification testing lab to develop testing protocols to enable quick certification ofBand 8 devices fo

107、r use in the United States.The benefit of working with a global standard is that many existing devices,network components,and solutionsare well suited for the working environment of our targeted critical infrastructure and enterprise customers.Global standards also provide a long-term evolutionpath

108、for the technology chosen by our customers.Identify and Evaluate New Opportunities for Our Spectrum The wireless communications industry is highly competitive and subject to rapid regulatory,technological and market changes.A key part of ourbusiness strategy is to continually monitor changes in the

109、wireless industry and to evaluate how these changes could enable us to maximize the value of ourspectrum assets.Additionally,although we are initially focusing on the electric utility industry,we have identified other customer groups,including ports,railroads,water,oil and gas facilities,and mining

110、operations,where we believe there is both customer demand and a good fit for the private wireless broadbandnetworks,technologies,and solutions that our spectrum assets could support.As proof of the potential demand for our spectrum assets,two recent FCCspectrum auctions exceeded consensus valuation

111、estimates and brought in the first and third highest auction proceeds for the U.S.Treasury which we believedemonstrates the continued demand for licensed broadband spectrum.Our Broadband Market OpportunityWe have identified utility and critical infrastructure enterprises as the primary customers for

112、 our future broadband spectrum assets.We have identifiedthe electric utility industry as our initial focused customer group.We believe that security,priority access,latency,redundancy,private ownership,control andunique coverage requirements are just some of the reasons utility and critical infrastr

113、ucture enterprises would be interested in obtaining rights to deploy theprivate wireless broadband networks,technologies and solutions that can be enabled through use of our spectrum.The electric utility industry is undergoing a fundamental transformation.Grid modernization efforts and the drive to

114、reduce carbon emissions havedisrupted the need for utilities to build new large-scale,centralized facilities.Today,power is generated by smaller,more geographically distributed facilitiesthat can switch from a power producer to a recipient of power generated by a variety of other disparate sources,i

115、ncluding wind and solar installations.Gridarchitecture must now accommodate end-users that are both generators and consumers,converting back and forth rapidly and carrying power in bothdirections,something the existing grid was not originally designed to handle.Technological advancements have produc

116、ed sensors and smart devices to enablethe new two-way grid and offer operators the ability to control and run the grid efficiently,safely and reliably.Utilities,however,need wireless communicationnetworks,technologies and solutions that can move the large volumes of data generated by these sensors a

117、nd smart devices to their control systems for decisionmaking,analytics and responsiveness to market demand and emergencies.The legacy communications systems utilized by many utilities cannot handle thisnew data load,have increasing interference and/or higher cyber threats,are inefficient and costly

118、to maintain,and,in many cases,have associated equipmentthat is approaching end of life.Our targeted customers have historically built,maintained and operated communication networks,including private Land Mobile Radio(“LMR”)networks and supervisory control and data acquisition(“SCADA”)networks on nar

119、rowband frequencies licensed exclusively to them by the FCC.Based onour discussions with these targeted customers,these entities commonly express their desire to retain the positive elements of their aging LMR and SCADAnetworks,namely private ownership,tight control and custom features(such as speci

120、alized coverage and priority access),while adding the benefits ofbroadband and other advanced technologies(such as solving a broader set of use cases,including high-speed data transmission,video services and economiesof scale).However,due to the general unavailability of low band spectrum(i.e.,below

121、 1 GHz),Page 5Table of Contentsthese entities have had limited opportunities to license or acquire the spectrum required to deploy cost-effective wireless broadband or other advancedtechnologies on their own.In contrast to legacy systems,the wireless broadband networks,technologies and solutions tha

122、t can be deployed by utilizing our spectrum assets canaddress the communication demands of the modern grid,both now and in the future.Our licensed 900 MHz spectrum offers the assurance of absolute controlover access to and use of that spectrum,allowing our spectrum to be utilized to provide customer

123、s with guaranteed levels of service and the ability to prescribeand enforce purpose-built“rules of the road”for the provision of those services.Our spectrum assets can also serve as the foundational element to allow ourcritical infrastructure and enterprise customers to implement LTE capabilities an

124、d evolve to 5G when there is a need.Recent FCC actions,including variousauctions,have created significant opportunities for blocks of shared,unlicensed spectrum and/or licensed spectrum in the mid and high spectrum bands.TheFCC also decided in 2020 to allow our spectrum to be converted to broadband.

125、The additional shared,unlicensed spectrum and/or licensed spectrum can enablefuture 5G networks,technologies and solutions.While we intend to build our existing and future business strategies around our 900 MHz licensed spectrum,the ability of our critical infrastructure and enterprise customers to

126、combine our licensed 900 MHz spectrum with additional spectrum in one or more licensed,shared and/or unlicensed bands can provide them with an advantageous solution.Business DevelopmentWe have invested in building our business development,sales and marketing teams,which include both external and int

127、ernal resources,to help fosterour evolving customer relationships in furtherance of growing and maturing our pipeline.Since the FCCs issuance of the Report and Order,our sales andmarketing efforts have been focused on pursuing spectrum lease arrangements with our targeted utility and critical infras

128、tructure customers.Our business development,sales and marketing organizations have the following three key focus areas:(i)direct account-based sales and marketingefforts to our targeted customers;(ii)regulatory outreach and support;and(iii)industry trade organization collaboration.We intend to enhan

129、ce these effortswith sales and marketing partnerships with a variety of third parties,such as integrators and technology and equipment vendors,with whom we will seek activepromotion of our broadband spectrum assets and support for our broadband spectrum assets with their products,technologies,soluti

130、ons and services.Additionally,our marketing team supports our sales efforts through collateral,product demonstrations,presentations and branded participation throughsponsorships and speaking engagements at major trade events,associations and organizations and customer meetings,to expand our brand aw

131、areness.Long-Term Leases of 900 MHz Broadband SpectrumAmeren AgreementsIn December 2020,we entered into our first long-term 900 MHz broadband spectrum lease agreements(the“Ameren Agreements”)coveringAmerens service territories.The Ameren Agreements will enable Ameren to deploy a PLTE network in its

132、service territories in Missouri and Illinois,coveringapproximately 7.5 million people.Each Ameren Agreement is for a term of up to 40 years,consisting of an initial term of 30 years,with a 10-year renewaloption for an additional payment.The scheduled prepayments for the 30-year initial terms of the

133、Ameren Agreements total$47.7 million,of which$0.3 millionwe received in February 2021,$5.4 million in September 2021 and$17.2 million in October 2021.The prepayments received to date encompass the initialupfront payment(s)due upon signing of the Ameren Agreements and payments for delivery of the rel

134、evant 1.4 x 1.4 cleared spectrum in several metropolitancounties throughout Missouri and Illinois,in accordance with the terms of the Ameren Agreements.The remaining prepayments of$24.8 million,excludingpotential penalties,for the 30-year initial term are due by mid-2026,per the terms of the Ameren

135、Agreements and as we deliver the relevant cleared 900 MHzBroadband Spectrum and the associated broadband licenses.We are working with incumbents to clear the 900 MHz Broadband Spectrum allocation inAmerens service territory.In August 2021,the FCC granted the first 900 MHz broadband licenses to us fo

136、r several counties in Amerens service territory,forwhich the Ameren Agreements were also subsequently approved by the FCC.In accordance with ASC 606,the payments of prepaid fees under the AmerenAgreements will be accounted for as deferred revenue on the Companys Consolidated Balance Sheets and will

137、be recognized ratably as we deliver cleared 900MHz Broadband Spectrum and the associated broadband licenses by county over the contractual term of approximately 30-years.Page 6Table of ContentsThe following table represents the delivery milestones as defined in the Missouri and Illinois Ameren Agree

138、ments and the allocated value ascribed foreach term of the milestone.AmerenMilestoneTotal allocated value(inmillions)*Expected start of revenuerecognition*Term*Upfront deposit$0.3 Q3 FY2230 yearsDelivery of area 1 1.4 x 1.4 spectrum1.7 Q3 FY223 yearsDelivery of area 1 3 x 3 spectrum21.0 Q1 FY2527 ye

139、arsDelivery of area 2 3 x 3 spectrum1.9 Q1 FY2527 yearsDelivery of area 3 3 x 3 spectrum22.8 Q1 FY2725 years*Total allocated value is subject to change based on final delivery date of the broadband licenses for the associated milestone,which may include penaltiesassociated with delayed deliveries.*R

140、evenue recognition occurs upon delivery of broadband licenses for the associated milestone,which may be delayed at Amerens request.Term iscalculated based on the expected delivery date,which correlates to the period of time the revenue will be recognized for the associated milestone.Evergy Agreement

141、In September 2021,we entered into a long-term lease agreement of 900 MHz broadband spectrum with Evergy,(the“Evergy Agreement”).TheEvergy service territories covered by the Evergy Agreement are in Kansas and Missouri with a population of approximately 3.9 million people.The EvergyAgreement is for a

142、term of up to 40 years,comprised of an initial term of 20 years with two 10-year renewal options for additional payments.Prepayment infull of the$30.2 million for the 20-year initial term,which was due and payable within thirty(30)days after execution of the Evergy Agreement,was receivedby us in Oct

143、ober 2021.The Evergy Agreement is subject to customary provisions regarding remedies for non-delivery,including refund of amounts paid andtermination rights,if Anterix fails to perform its contractual obligations,including failure to deliver the relevant cleared 900 MHz broadband spectrum,inaccordan

144、ce with the terms of the Evergy Agreement.We are working with incumbents to clear the 900 MHz broadband spectrum allocation covered by theEvergy Agreement.We expect to recognize revenue from the Evergy Agreement commencing in the first half of fiscal year 2023.In accordance with ASC 606,the payments

145、 of prepaid fees under the Evergy Agreement will be accounted for as deferred revenue on the Companys Consolidated Balance Sheets and willbe recognized ratably as we deliver cleared 900 MHz broadband spectrum and the associated broadband licenses by county over the contractual term ofapproximately 2

146、0-years.The following table represents the delivery milestones as defined in the Evergy Agreement and the allocated value ascribed for each term of themilestone.EvergyMilestoneTotal allocated value(inmillions)*Expected start of revenuerecognition*Term*Delivery of 1.4 x 1.4 spectrum$0.9 Q2 FY231 year

147、Delivery of 3 x 3 spectrum29.3 Q2 FY2419 years*Total allocated value is subject to change based on final delivery date of the broadband licenses for the associated milestone,which may include penaltiesassociated with delayed deliveries.*Revenue recognition occurs upon delivery of broadband licenses

148、for the associated milestone.Term is calculated based on the expected delivery date,whichcorrelates to the period of time the revenue will be recognized for the associated milestone.Sale of 900 MHz Broadband SpectrumSDG&E AgreementIn February 2021,we entered into an agreement with SDG&E to sell 900

149、MHz broadband spectrum throughout SDG&Es California service territory,including San Diego and Imperial Counties and portions of Orange County(the“SDG&E Agreement”)for a total payment of$50.0 million.The SDG&EAgreement will support SDG&Es deployment of a PLTE network for its California service territ

150、ory,with a population of approximately 3.6 million people.Aspart of the SDG&E Agreement,SDG&E and Anterix are collaborating to accelerate the utility industry momentum for private networks.The SDG&EAgreement includes the assignment of 6 MHz of 900 MHz broadband spectrum,936.5 939.5 MHz paired with 8

151、97.5 900.5 MHz,within SDG&Es serviceterritory following the FCCs issuance of the broadband licenses to us.Delivery of the relevant 900 MHz broadband spectrum and the associated broadbandlicenses by county is expected to commence in fiscal yearPage 7Table of Contents2023 and is scheduled for completi

152、on before the end of fiscal year 2024.The total payment of$50.0 million is comprised of an initial payment of$20.0million,received in February 2021 and the remaining$30.0 million payment,which is due through fiscal year 2024 as we deliver the relevant cleared 900 MHzbroadband spectrum and the associ

153、ated broadband licenses to SDG&E.We are working with incumbents to clear the 900 MHz broadband allocation inSDG&Es California service territory.The SDG&E Agreement is subject to customary provisions regarding remedies,including reduced payment amountsand/or refund of amounts paid,and termination rig

154、hts,if a party fails to perform its contractual obligations.A gain or loss on the sale of spectrum will berecognized for each county once we deliver the cleared 900 MHz broadband spectrum and the associated broadband licenses to SDG&E.CompetitionOur competitors include the Tier 1 carriers(Verizon,AT

155、&T and T-Mobile),private radio operators and other public and private companies who ownspectrum,supply communication networks,technologies,products and solutions to our targeted utility and critical infrastructure enterprises.Many of thesecompetitors have a long track record of providing technologie

156、s,products and solutions to our targeted customers and have greater political and regulatoryinfluence than we do.In addition,many of our competitors have more resources,substantially greater product development and marketing budgets,greatername and brand recognition,a significantly greater base of c

157、ustomers in which to spread their operating costs and more financial and personnel resources thanwe do.All of these factors could prevent,delay or increase the costs of commercializing the broadband licenses we secure to our targeted customers.In addition,these and other competitors have developed o

158、r may develop services,technologies,products and solutions that directly compete with thebroadband networks,technologies,products and solutions that can be deployed with our spectrum assets.If competitors offer services,technologies,productsand solutions to our targeted customers at prices and terms

159、 that make the licensing of our spectrum assets unattractive,we may be unable to attract customers atprices or on terms that would be favorable,or at all,which could have an adverse effect on our financial results and prospects.Further,the FCC and other federal,state and local governmental authoriti

160、es could adopt new regulations or take actions,including making additionalspectrum available that can be utilized by our targeted customers,which could harm our ability to license our spectrum assets.For example,the federalgovernment created and funded the First Responder Network Authority(“FRNA”),w

161、hich the federal government authorized to help accomplish,fund,andoversee the deployment of a dedicated Nationwide Public Safety Broadband Network(“NPSBN”),which is marketed as“FirstNet.”The NPSBN may providean additional source of competition to utilizing our 900 MHz spectrum assets by our targeted

162、 utility and critical infrastructure enterprises.Our Historical FCC InitiativesJoint Petition While our current licensed spectrum can support narrowband and wideband wireless services,the most significant business opportunities we identifiedrequire contiguous spectrum that allows for greater bandwid

163、th than allowed by the original configuration of the 900 MHz band.In November 2014,inconjunction with the Enterprise Wireless Alliance(“EWA”),we submitted a Joint Petition for Rulemaking(the“Joint Petition”)to the FCC proposing arealignment of a portion of the 900 MHz band to create a 6 MHz broadban

164、d segment,while retaining 4 MHz for continued narrowband operations.In May2015,we and the EWA filed proposed rules with the FCC related to our Joint Petition recommending procedural and technical operating parameters andprocesses related to the administration and technical sequencing of the proposed

165、 realignment of the 900 MHz band.Our proposed rules included therequirement for the broadband operator to provide comparable facilities to incumbent licensees,to pay the costs of their realignment and to utilize availablefiltering technologies to protect incumbents adjacent to the proposed broadband

166、 portion of the 900 MHz band.Notice of Inquiry In August 2017,the FCC issued a Notice of Inquiry(“NOI”)announcing that it had commenced a proceeding to examine whether it would be in thepublic interest to change the existing rules governing the 900 MHz band to increase access to spectrum,improve spe

167、ctrum efficiency and expand flexibility fora variety of potential uses and applications,including broadband and other advanced technologies and services.We and EWA filed a joint response to theFCCs NOI in October 2017 and submitted reply comments in November 2017.Notice of Proposed Rulemaking On Mar

168、ch 14,2019,the FCC unanimously adopted a Notice of Proposed Rulemaking(“NPRM”)endorsing our objective of creating a broadbandopportunity in the 900 MHz band for critical infrastructure and other enterprise users.In the NPRM,the FCC set to determine(i)what mechanism andrequirements should be imposed

169、before a broadband applicant can acquire the FCCs inventory of spectrum,including how to mitigate a windfall that might beattributed to the broadband applicant by the FCCs action;(ii)what mechanism should be used to enable the broadband applicant to clear sufficientPage 8Table of Contentsspectrum to

170、 qualify for a broadband license,including how to prevent potential holdouts;(iii)what size systems being operated by incumbents should bedeemed to be“Complex Systems”and exempt from any Mandatory Retuning requirements;and(v)what approaches,including potential overlay auctions,should be used in coun

171、ties where the broadband segment cannot be cleared of incumbents.We filed our comments to the NPRM in June 2019 and submitted reply comments in July 2019.The 900 MHz Report and OrderOn May 13,2020,the FCC approved the Report and Order to modernize and realign the 900 MHz band to increase its usabili

172、ty and capacity byallowing it to be utilized for the deployment of broadband networks,technologies and solutions.In the Report and Order,the FCC reconfigured the 900 MHzband to create a 6 MHz broadband segment(240 channels)and two narrowband segments,consisting of a 3 MHz narrowband segment(120 chan

173、nels)and a 1MHz narrowband segment(39 channels).FIGURE I below illustrates the FCC realignment as outlined in the Report and Order.FIGURE IThe Role of the CountyUnder the Report and Order,the FCC established the“county”as the base unit of measure in determining whether a broadband applicant is eligi

174、ble tosecure a broadband license.There are 3,233 counties in the United States,including Puerto Rico and other U.S.territories.Broadband License Eligibility Requirements The Report and Order establishes three eligibility requirements to obtain broadband licenses in a county,which we refer to herein

175、as(i)the“50%Licensed Spectrum Test,”(ii)the“90%Broadband Segment Test”and(iii)the“240 Channel Requirement.”Treatment of Complex Systems The Report and Order exempts Complex Systems from the Mandatory Retuning process,even when a broadband applicant meets the 90%BroadbandSegment Test,because retuning

176、 these systems would potentially be disruptive to the operators.MAP 1 below illustrates the current Complex Systems and ourstatus regarding swap agreements.Page 9Table of ContentsThe Association of American Railroads The nations railroads,particularly the major freight lines,operate on six narrowban

177、d 900 MHz channels licensed to their trade association,theAssociation of American Railroads(“AAR”).Three of these narrowband channels are located in the 900 MHz broadband segment created by the FCC.InJanuary 2020,we entered into an agreement with the AAR in which we agreed to cancel licenses in the

178、900 MHz band to enable the AAR to relocate itsoperations,including operations utilizing the three channels located in the 900 MHz broadband segment(the“AAR Agreement”).The FCC referenced theAAR agreement in the Report and Order and required us to cancel our licenses and return them to the FCC in acc

179、ordance with the AAR Agreement.Wecancelled these licenses in June 2020.The Report and Order provides that the FCC will make the channels associated with these licenses available to the AARto enable the AAR to relocate their current operations.The Report and Order also provides that the FCC will cred

180、it us for our cancelled licenses for purposes ofdetermining our eligibility to secure broadband licenses and the calculation of any Anti-Windfall Payments.Broadband Licensing ProcessIn May 2021,the Wireless Telecommunication Bureau released a Public Notice detailing the application requirements and

181、timeline for obtainingbroadband licenses.The broadband licensing process includes an FCC Form 601,an application used for new wireless licenses,an Eligibility Certification anda Transition Plan describing the agreements the prospective broadband applicant has entered into with Covered Incumbents.We

182、intend to pursue and fileapplications based on the timing of customer opportunities,strategic initiatives and our spectrum clearing results.Within 15 days of filing a broadbandapplication,we will surrender our underlying licenses.The Anti-Windfall payment to the U.S.Treasury for any spectrum we requ

183、ire from the FCCs inventoryto reach the 240 Channel Requirement will be made as soon as possible after the FCC provides us the amount due for these channels.In cases where we havesatisfied the 90%Broadband Segment Test but have not reached an agreement with all Covered Incumbents,the Mandatory Retun

184、ing process will commenceafter we receive the broadband license.1.50%Licensed Spectrum Test.To be eligible for a broadband license in a particular county,a broadband applicant must demonstrate that itholds more than 50%of the outstanding licensed channels in that county.As noted above,the 900 MHz ba

185、nd is made up of a maximum of 399 channels in eachcounty.The FCC has licensed less than the maximum number of 399 channels in all but the most populous counties.Because the 50%Licensed Spectrum Testis based on licensed channels,any channels that are not licensed by the FCC are not included in the de

186、nominator when determining whether the broadbandapplicant has satisfied this test.As of the date of this filing,we alone satisfy the 50%Licensed Spectrum Test in approximately 3,200 counties of the 3,233counties in the United States and its territories.MAP 2 below illustrates our licensed channels b

187、y county in the entire 900 MHz band segment created by theReport and Order.Page 10Table of Contents2.90%Broadband Segment Test.The second test,the 90%Broadband Segment Test,addresses the balance between a voluntary marketprocess to clear any“Covered Incumbent”(i.e.,holders of licenses in the broadba

188、nd segment)and the Mandatory Retuning process established by the FCC inthe Report and Order(which applies to all Covered Incumbents,except for those Covered Incumbents operating“Complex Systems”as defined above).Thistest requires the broadband applicant to hold or have agreements with Covered Incumb

189、ents for 90%of the licensed channels in the broadband segment in aparticular county and within 70 miles of the countys boundaries before the FCC will issue a broadband license and therefore commence the mandatoryretuning period.The broadband segment in the 900 MHz band has a total of 240 channels.Th

190、e 90%Broadband Segment Test is calculated using outstandinglicensed channels,which means that if the FCC has licensed all 240 channels,the broadband applicant would be required to have control of,or agreementscovering,216 channels within the broadband segment.In most counties in the United States,th

191、e FCC has licensed fewer than 240 channels in the broadbandsegment and these unlicensed channels are not included in the denominator when determining whether the broadband applicant has satisfied this 90%Broadband Segment Test.A broadband applicant can satisfy the 90%Broadband Segment Test by purcha

192、sing channels from Covered Incumbents for cash or otherconsideration,by paying to relocate Covered Incumbents to replacement spectrum channels outside the broadband segment,or by demonstrating that thebroadband applicants facilities will be far enough from the Covered Incumbents narrowband system to

193、 allow the two types of networks to co-exist.Before filing for a broadband license,the broadband applicant must satisfy the 90%Broadband Segment Test by utilizing its channel holdings andnegotiating with Covered Incumbents on a purely voluntary basis for any additional channels it requires to satisf

194、y this test.Only after the 50%LicensedSpectrum Test and the 90%Broadband Segment Test are satisfied will the FCC issue to the broadband applicant a broadband license and commence the“Mandatory Retuning”period.During this Mandatory Retuning period,any Covered Incumbents that remain in the broadband s

195、egment(other than ComplexSystems)are required to negotiate in good faith with the broadband applicant to sell their channels or otherwise clear the broadband segment,subject tointervention by the FCC if the parties cannot reach an agreement.MAP 3 below illustrates our licensed holdings and licensed

196、holdings we have under contract by county in the 6 MHz broadband segment created bythe Report and Order.This map does not reflect licenses that may meet the protection criteria as that is evaluated on a county basis as each broadband transitionplan is prepared.Page 11Table of Contents3.240 Channel R

197、equirement.The Report and Order requires the broadband applicant to surrender 6 MHz of narrowband spectrum(or 240channels)in the applicable county to the FCC in exchange for a broadband license.If the broadband applicant does not have sufficient channels in the county toreturn 240 channels to the FC

198、C,it can elect to make an Anti-Windfall Payment to the U.S.Treasury to effectively purchase unlicensed channels in the FCCsinventory.The Anti-Windfall Payment for these channels will be based on prices paid in the applicable county in the 600 MHz auction conducted by the FCC.To satisfy the 240 Chann

199、el Requirement,the broadband applicant has the option on a county-by-county basis to determine whether it is more cost-effective tomake the Anti-Windfall Payment,purchase channels from incumbents(where available),or possibly a combination of both.Importantly,the markets where the FCC has channels in

200、 inventory and where we may need to make Anti-Windfall Payments to effectively return 240channels to the FCC are generally in smaller urban,suburban and rural markets.Our spectrum position is greatest in the largest,most populated and thereforemost expensive markets,with a few exceptions as shown in

201、 MAP 4 below.Although we will need to make Anti-Windfall Payments to secure broadbandlicenses in some counties,the average cost in aggregate for the channels,will be lower than the nationwide average amount of$0.93 per MHz of populationcovered(“POP”)paid in the FCCs 600 MHz auction.Costs of Securing

202、 Broadband LicensesAs discussed above,to obtain a broadband license in a county,the broadband applicant must satisfy(i)the 50%Licensed Spectrum Test,(ii)the 90%Broadband Segment Test and(iii)the 240 Channel Requirement.As the broadband applicant,we can satisfy these channel requirements by including

203、 ourexisting licensed channels in the 900 MHz band and byPage 12Table of Contentsacquiring or clearing additional channels when necessary,through(i)spectrum purchases,(ii)spectrum retuning and/or(iii)by making Anti-WindfallPayments.Under the Report and Order,we have the option of using each of these

204、 options alone,or in any combination required,to satisfy the broadbandlicense eligibility requirements for a particular county.1.Spectrum Purchase.In 2015,we began acquiring targeted additional channels in the 900 MHz band in various markets in anticipation of theReport and Order.We have and will co

205、ntinue to employ spectrum acquisition as a tool for those situations where a Covered Incumbent desires to exit the 900MHz band.We may selectively acquire channels outside the 900 MHz broadband segment and use them to swap for channels within the broadband segment.For purposes of our broadband licens

206、e eligibility,any potential acquisitions we negotiate in the 900 MHz band may be included as part of our broadbandapplication,but the acquisition does not need to be consummated at the time we submit our broadband license application.2.Spectrum Retuning.Retuning is the exercise of modifying,broadban

207、d segment channels held by Covered Incumbents and moving them tochannels outside of the 900 MHz broadband segment established by the Report and Order.In cases where we cannot retune,we must swap our narrowbandchannels outside the broadband segment for the broadband segment channels held by a Covered

208、 Incumbent.A retune or swap adds to the number of channelswe hold for computational purposes of the 90%Broadband Segment Test.We began retuning or swapping channels with interested Covered Incumbents in2015 in anticipation of the Report and Order.We have continued retuning and swapping channels with

209、 Covered Incumbents since that time.For purposes ofbroadband license eligibility,any potential spectrum retuning or swapping agreements we negotiate in the 900 MHz band will be included as part of ourbroadband application,but we are not required to complete the retune or swap before we submit our br

210、oadband license application.3.Anti-Windfall Payment.To obtain a 6 MHz broadband license,we must surrender 240 licensed channels in the county.As this band has beenunderutilized historically,most counties in the United States do not have 240 outstanding licensed channels.To make up the difference,we

211、may effectively payfor channels from the FCCs spectrum inventory by making an Anti-Windfall Payment.As noted above,the FCC will use a reference per channel price basedon the average price paid in the FCCs 600 MHz auction in each given county.Our Historical BusinessesPrior to the Report and Order and

212、 our shift in business strategy,we generated our revenue principally from our pdvConnect and TeamConnectbusinesses.pdvConnect is a mobile communication and workforce management solution that enables businesses to locate and communicate with their fieldworkers and improve the documentation of work ev

213、ents and job status.We historically marketed pdvConnect primarily through two Tier 1 carriers in theUnited States.In the year ended March 31,2016,we began offering a commercial push-to-talk(“PTT”)service,which we marketed as TeamConnect,in sevenmajor metropolitan areas throughout the United States,i

214、ncluding Atlanta,Baltimore/Washington,Chicago,Dallas,Houston,New York and Philadelphia.Wedeveloped TeamConnect to address the needs of enterprises that value a tailored PTT solution addressing the management of their mobile workforce.Weprimarily offered our TeamConnect service to customers indirectl

215、y through third-party sales representatives who were primarily selected from Motorolasnationwide dealer network.In June 2018,we announced our plan to restructure the business to align and focus our business priorities on the spectrum initiatives aimed atmodernizing and realigning the 900 MHz band to

216、 increase its usability and capacity,including for the future deployment of broadband and other advancedtechnologies and services.In December 2018,our Board approved thePage 13Table of Contentstransfer of our TeamConnect and pdvConnect businesses to help reduce our operating costs and to allow our m

217、anagement team and Company to focus on ourFCC initiatives and future broadband opportunities.Specifically,we entered into:(i)a Customer Acquisition and Resale Agreement with A BEEP LLC(“ABEEP”)on January 2,2019,(ii)a Customer Acquisition,Resale and Licensing Agreement with Goosetown Enterprises,Inc.

218、(“Goosetown”)on January 2,2019 and(iii)a memorandum of understanding(“MOU”)with the principals of Goosetown on December 31,2018.Under the A BEEP and Goosetown agreements,we:(i)transferred our TeamConnect customers located in the Atlanta,Chicago,Dallas,Houston andPhoenix metropolitan markets to A BEE

219、P,(ii)transferred our TeamConnect customers located in the Baltimore/Washington DC,Philadelphia and New Yorkmetropolitan markets to Goosetown,(iii)provided A BEEP and Goosetown with access to our TeamConnect Metro and Campus Systems(the“MotoTRBO Systems”)and(iv)granted A BEEP and Goosetown the right

220、 to resell access to our MotoTRBO Systems pursuant to separate Mobile VirtualNetwork Operation arrangements for two years.We also granted Goosetown a license to sell the business applications we developed for our TeamConnectservice.Under these agreements,A BEEP and Goosetown agreed to provide custom

221、er care,billing and collection services for their respective acquiredcustomers.We continued to provide these services through April 1,2019,to help facilitate the transition of the acquired customers.Additionally,we wererequired to maintain and pay all site lease,backhaul and utility costs required t

222、o operate the MotoTRBO Systems for two years,which ended on January 2,2021.As part of our efforts to clear the 900 MHz spectrum for broadband use,A BEEP and Goosetown were required to migrate the acquired customers offthe MotoTRBO Systems by the end of this two year period.In consideration for the c

223、ustomers and rights we transferred,A BEEP and Goosetown wererequired to pay us a certain portion of the recurring revenues they receive from the acquired customers ranging from 20-100%during the terms of theagreements.Additionally,A BEEP was required to pay us a portion of recurring revenue from cus

224、tomers who utilize A BEEPs push-to-talk Diga-Talk Plusapplication service ranging from 15-35%for the two year period.Goosetown was required to pay us 20%of recurring revenues from the TeamConnectapplications we licensed to them for the two year period.As part of our obligations,we will continue oper

225、ating the TeamConnect networks in the markets inwhich customers are being transferred and trunked facilities in other markets in which we hold FCC licenses.Under the terms of the MOU,we assigned the intellectual property rights to our TeamConnect and pdvConnect applications to TeamConnect LLC(the“LL

226、C”),an entity formed by the principals of Goosetown,in exchange for a 19.5%ownership interest in the LLC upon the April 30,2019 execution of theLLCs Amended and Restated Limited Liability Company Agreement.The Goosetown principals agreed to fund the future operations of the LLC,subject tocertain lim

227、itations.The LLC assumed our software support and maintenance obligations under the A BEEP and Goosetown agreements.The LLC also assumedcustomer care services related to our pdvConnect application.On April 1,2020,we transferred our pdvConnect customers to the LLC and the LLC agreed topay us a certai

228、n portion of the recurring revenues from these customers.On April 1,2020,we entered into Amendment 2(“Amendment 2”)to the IP Assignment,Software Support,and Development Services Agreement,dated as of January 7,2019,as previously amended,by and between us and the LLC.Under Amendment 2,we transferred

229、our pdvConnect customers to theLLC except for one Tier 1 domestic carrier.In exchange for the customer transfer,the LLC agreed to pay us a certain portion of the recurring revenues fromthese customers.Motorola Lease In 2014,we entered into an agreement with Motorola to lease a portion of our 900 MHz

230、 licenses in exchange for an upfront,fully paid lease fee of$7.5 million.Additionally,Motorola invested$10 million in our subsidiary,PDV Spectrum Holding Company,LLC,that we formed to hold our 900 MHzspectrum licenses.Motorolas ownership interest in our subsidiary is convertible,at the option of eit

231、her party,into shares of our common stock at a price equalto$20.00 per share.Motorola is not entitled to any profits,dividends,or other distribution from the operations of our subsidiary.Under the terms of this leaseagreement with Motorola,Motorola can use the leased channels to provide narrowband s

232、ervices to certain qualified end-users.The end-users can only use theleased channels for their internal communication purposes.The end-users cannot sublease the channels to any other end-users or any commercial radio systemoperations or carriers.The lease agreement limits the total number of channel

233、s that Motorola can lease in any market area.The lease agreement provides uswith flexibility regarding the future use and management of our spectrum,including relocation and repurposing policies designed to facilitate any necessaryrealignment of frequencies that may be associated with our efforts to

234、 clear spectrum for broadband uses.Motorola cannot enter contracts with end-users after December 31,2020,involving new leases of spectrum from us without our consent and thepayment of an additional fee.The initial lease period for any end-user cannot last more than seven years,and the lease can only

235、 be renewed for up to threeyears for an aggregate lease period of up to ten years.Our Intellectual PropertyWe rely on a combination of patent,copyright,trademark and trade-secret laws,as well as confidentiality provisions in our contracts,to protect ourintellectual property.We have several trademark

236、s and service marks to protect our current andPage 14Table of Contentsfuture corporate name,services offerings,goodwill and brand.There are currently no claims or litigation regarding these trademarks,patents,copyrights,orservice marks.We also rely on trade secret protection of our intellectual prop

237、erty.We enter into confidentiality agreements with third parties,employees andconsultants when appropriate.Regulation of Our BusinessWe hold FCC spectrum licenses in the 900 MHz band throughout the contiguous United States,plus Hawaii,Alaska and Puerto Rico.The FCCregulates our wireless spectrum hol

238、dings,the issuance of broadband licenses in the 900 MHz band in accordance with the Report and Order,our future leasingor sale of any broadband licenses we secure,and the future construction and operation of wireless networks,technologies and solutions utilizing our spectrumassets.LicensingWe are au

239、thorized to provide our wireless communication services on specified frequencies within specified geographic areas and in doing so mustcomply with the rules,regulations and policies adopted by the FCC.The FCC issues each spectrum license for a fixed period,typically ten years in the case ofthe FCC n

240、arrowband licenses we currently hold and 15 years for any broadband licenses in accordance with the Report and Order.Any broadband licenses wesecure will also have performance requirements at the 6-and 12-year marks to demonstrate that the broadband spectrum is being used to serve the publicinterest

241、.While the FCC has generally renewed licenses held by operating companies like us,the FCC has the authority to both revoke a license for cause and todeny a license renewal if it determines that license renewal is not in the public interest.Furthermore,we could be subject to fines,forfeitures and oth

242、erpenalties for failure to comply with FCC regulations,even if any such non-compliance is unintentional.The loss of any licenses,or any related fines orforfeitures,could adversely affect our business,results of operations or financial condition.The Communications Act of 1934,as amended,and FCC rules

243、 and regulations require us to obtain the FCCs prior approval before assigning ortransferring control of wireless licenses,with limited exceptions.The FCCs rules and regulations also govern spectrum lease arrangements for a range ofwireless radio service licenses,including the licenses we hold.These

244、 same requirements apply to any licenses or leases we may wish to enter into,transfer,oracquire as part of our broadband initiatives.The FCC may prohibit or impose conditions on any proposed acquisitions,sales,or other transfers of control oflicenses or leases.The FCC engages in a case-by-case revie

245、w of transactions that involve the consolidation or sale of spectrum licenses or leases and may applya spectrum“screen”in examining such transactions.Because an FCC license is necessary to lawfully provide the wireless services we plan to enable,if theFCC were to disapprove any such request to acqui

246、re,assign,or otherwise transfer a license or lease,our business plans would be adversely affected.Approvalfrom the Federal Trade Commission and the Department of Justice,as well as state or local regulatory authorities,also may be required if we sell or acquirespectrum.FCC Regulations The FCC does n

247、ot currently regulate rates for services offered by wireless providers.However,we may be subject to other FCC regulations thatimpose obligations on wireless providers,such as Federal Universal Service Fund obligations,which require communications providers to contribute to a fundthat supports subsid

248、ized communications services to underserved areas and users;rules governing billing,subscriber privacy and customer proprietary networkinformation;roaming obligations;rules that require wireless service providers to configure their networks to facilitate electronic surveillance by lawenforcement off

249、icials;rules governing spam,telemarketing and truth-in-billing and rules requiring us to offer equipment and services that are accessible to andusable by persons with disabilities,among others.There are also pending proceedings that may affect spectrum aggregation limits and/or adjustment of theFCCs

250、 case-by-case spectrum screens;regulation surrounding the deployment of advanced wireless broadband infrastructure;the imposition of text-to-911capabilities;and the transition to IP networks,among others.Some of these requirements and pending proceedings(of which the previous examples are not anexha

251、ustive list)pose technical and operational challenges which we,and the industry as a whole,have not yet developed clear solutions.We are unable topredict how these pending or future FCC proceedings may affect our business,financial condition,or results of operations.Our failure to comply with anyapp

252、licable FCC regulations could subject us to significant fines or forfeitures.State and Local Regulation In addition to FCC regulation,we are subject to certain state regulatory requirements.The Communications Act of 1934,as amended,preempts stateand local regulation of the entry of,or the rates char

253、ged by,any wireless provider.State and local governments,however,are permitted to manage public rightsof way and can require fair and reasonable compensation from wireless providers for use of those rights of way so long as the compensation required ispublicly disclosed by the government.The siting

254、of base stations also remains subject to some degree of control by state and local jurisdiction.States also mayimpose competitively neutral requirements that,among other things,are necessary for universal service or to defray the costs of state E911 services programs,to protect the public safety and

255、 welfare and to safeguard the rights of customers.Page 15Table of ContentsTower Siting Our future customers who deploy broadband networks will be required to comply with various federal,state and local regulations that govern thesiting,lighting and construction of transmitter towers and antennas,inc

256、luding requirements imposed by the FCC and the Federal Aviation Administration(“FAA”).Federal rules subject certain tower site locations to extensive zoning,environmental and historic preservation requirements and mandate consultationwith various parties,including State and Tribal Historic Preservat

257、ion Offices,which can make it more difficult and expensive to deploy facilities.The FCCantenna structure registration process also imposes public notice requirements when plans are made for construction of,or modification to,antenna structuresthat require FAA approval,potentially adding to the delay

258、s and burdens associated with tower siting,including potential challenges from special interestgroups.To the extent governmental agencies continue to impose additional requirements like this on the tower siting process,the time and cost to constructtowers could be negatively impacted.The FCC has,how

259、ever,imposed a tower siting“shot clock”that requires local authorities to address tower applicationswithin a specific timeframe,which can assist carriers in more rapid deployment of towers.More recently,the FCC also has adopted rules intended to acceleratebroadband deployment by removing barriers to

260、 infrastructure investment,in particular for“small cell”equipment.Those rules have been challenged by certainmunicipalities and tribal nations both at the FCC and in court.National Security With a range of weather-related and cyber security impacts on the nations grid over the last several years,nat

261、ional security and disaster recoveryissues continue to receive attention at the federal,state and local levels.For example,Congress is expected to again consider cyber security legislation toincrease the security and resiliency of the nations digital infrastructure.Our future customers who deploy br

262、oadband networks may be required to comply withpotential federal,state and local regulations that govern elements of the electric grid.Report and Order The FCC regulates the issuance of broadband licenses in the 900 MHz band in accordance with the Report and Order.Human Capital ManagementWe believe

263、we have an experienced,talented,motivated and dedicated team.We are committed to supporting the development of all of our employeesand to continuing to build on our strong culture.As of March 31,2022,we had seventy-three full-time employees.We engage consultants and contract workerson an as-needed b

264、asis.We believe the relations with our employees and consultants are good.Company CultureWe are guided by our core values Integrity,Courage,Camaraderie,Transformative,and Excellence that express how we aspire to be when we areat our best.With these values as the backbone of our corporate culture,we

265、work tirelessly to act as responsible stewards to our employees,communities andother stakeholders who rely on us.In addition,we are committed to governing and operating our business with the highest levels of integrity and ethics.We are focused on regular evaluation of our culture.In 2021,we invited

266、 all employees to participate in a culture assessment by completing ananonymous survey.Eighty percent of our employees participated in the cultural survey providing a good basis to gauge employee sentiment.Our managementteam reviewed the feedback and shared the survey results with employees at a qua

267、rterly Town Hall meeting.The survey showed that we have a highly engagedworkforce that overwhelmingly views our work environment favorably.Where our employees identified areas for improvement,we worked with variousfunctional areas to create and implement action plans to address any issues.Diversity,

268、Equity and InclusionWe are committed to hiring inclusively,providing training and development opportunities,fostering an inclusive culture,ensuring equitable pay foremployees,and focusing on attracting and retaining diverse representation at every level within the Company.We formed our Diversity,Equ

269、ity and InclusionTaskforce in 2020,and it has among its objectives increasing cultural awareness,creating a pipeline of diverse candidates,and diversifying our supplier base.Additionally,in 2021,we launched our first employee resource group Anterix Women in Excellence(“AWE”).AWE has as its purpose c

270、onnecting thewomen of Anterix and providing a space for support and advocacy,networking,training,leadership,and community-building opportunities for both employeesand interns.Partnerships with organizations like INROADS and Talent Hue provide further avenues for recruiting diverse talent.As of March

271、 31,2022,twenty-nine percent of our independent Board members identify as diverse.Additionally,sixty percent of our new hires in Fiscal 2022 were females,up from twenty-five percent of new hires in Fiscal 2021,and as a result,thirty-eight percent of our Fiscal 2022 workforce was female versus thirty

272、-four percent in Fiscal 2021.In terms of racial diversity,in Fiscal 2022,twenty-nine percent of our workforce is non-white,up from twenty-seven percent in Fiscal 2021.Page 16Table of ContentsEmployee Growth and DevelopmentWe offer a meaningful work environment with experiences and opportunities to g

273、row and develop.This starts with the opportunity for continuouslearning and the opportunity to do challenging,transformative work that helps our team build skills at all levels,including leadership opportunities,coaching,and mentoring.In addition to mandatory training on insider trading,anti-harassm

274、ent,and our Code of Business Conduct,we provide(and encourageemployees to partake in)optional career development,health and wellness,and employee engagement activities and training.We conduct surveys that gauge employee sentiment in areas like career development,manager performance and inclusivity,a

275、nd we are committed totaking steps to address areas needing improvement.Employee Health and SafetyWe strive to provide a safe workplace environment and have implemented policies to support the health and safety of our employees,including awork-from-home policy.As we continue to manage our business p

276、roactively through the global coronavirus crisis,we initially transitioned our workforce towork from home and have moved to a hybrid model,except for employees needing in-person access to laboratories or other resources onsite.We believe thatwe have learned to operate successfully in this unique env

277、ironment,and we remain committed to supporting our teams new,more carbon-friendly,hybrid workprogram.Our Corporate InformationOur principal executive offices are located at 3 Garret Mountain Plaza,Suite 401,Woodland Park,New Jersey 07424 and 8260 Greensboro Drive,Suite 501,McLean,Virginia.Our main t

278、elephone number is(973)771-0300.We were originally incorporated in California in 1997 and reincorporated inDelaware in 2014.Our website is .Available InformationOur Annual Reports on From 10-K,Quarterly Reports on Form 10-Q,Current Reports on Form 8-K and amendments to reports filed pursuant toSecti

279、ons 13(a)and 15(d)of the Securities Exchange Act of 1934,as amended(the“Exchange Act”)are made available free of charge on our website as soon asreasonably practicable after we electronically file such material with,or furnish it to,the Securities and Exchange Commissions(“SEC”).The SEC maintainsan

280、internet site at www.sec.gov that contains reports,proxy and information statements,and other information regarding issuers that file electronically with theSEC.We include our website address in this Annual Report only as an inactive textual reference.The information on or accessible through our web

281、site is notincorporated into this Annual Report,and you should not consider any information on,or that can be accessed through,our website a part of this Annual Reportor our other filings with the SEC.Item 1A.Risk Factors.You should carefully consider the following risk factors,together with the oth

282、er information contained in this Annual Report and our other reports andfilings made with the SEC,in evaluating our business and prospects.If any of the risks discussed in this Annual Report occur,our business,prospects,liquidity,financial condition and results of operations could be materially and

283、adversely affected,in which case the trading price of our common stock could declinesignificantly.Some statements in this Annual Report,including statements in the following risk factors,constitute forward-looking statements.Please refer tothe section entitled“Cautionary Statement Concerning Forward

284、-Looking Statements.”Risks Related to Obtaining Broadband Licenses,the Retuning Process and the Use of Our SpectrumOur plans to commercialize our 900 MHz spectrum assets depend on our ability to qualify for and obtain broadband licenses from the FCC inaccordance with the requirements of the Report a

285、nd Order.If we are unable to obtain broadband licenses on favorable terms and on a timely basis,ourbusiness,liquidity,results of operations and prospects will be materially adversely affected.Our plans to commercialize our 900 MHz spectrum assets depend on our ability to obtain broadband licenses in

286、 accordance with the requirements ofthe Report and Order approved by the FCC in May 2020,and which became effective on August 17,2022.The Report and Order establishes three generaleligibility requirements to obtain a broadband license,which we refer to herein as(i)the“50%Licensed Spectrum Test,”(ii)

287、the“90%Broadband SegmentTest”and(iii)the“240 Channel Requirement.”We will need to satisfy all eligibility requirements in each county in the United States for which we desire toobtain a broadband license.Under the 50%Licensed Spectrum Test,we must demonstrate that we hold more than 50%of the license

288、d channels in the 900MHz band in the applicable county.Under the 90%Broadband Segment Test,we must provide the FCC with a plan demonstrating that we hold,or haveagreements with Covered Incumbents for,at least 90%of the licensed channels in the 6 MHz broadband segment designated by the FCC and within

289、 70 miles ofthe county boundary.Under the 240 Channel Requirement,we must surrender 6 MHz of broadband or narrowband spectrum(or 240 channels)in theapplicable county to the FCC.If we do not have a sufficient number of channels to satisfy any of these eligibility requirements,we will be required to p

290、urchasethe additional channels from incumbents in privately negotiated transactions,swap our existing channelsPage 17Table of Contentswith incumbents(including any required retuning of the incumbent radio systems),demonstrate the ability to protect Covered Incumbents or effectivelypurchase channels

291、not previously licensed by the FCC by making an Anti-Windfall Payment.The amount of spectrum we will be required to purchase and/orswap and the amount of any Anti-Windfall Payment will vary in each county based on our existing spectrum holdings in such county.Our ability to acquireand/or swap the ad

292、ditional spectrum necessary to secure broadband licenses in a desired county on a timely and cost-effective basis will depend on theincumbents who hold the additional spectrum we need to acquire or swap and their operations that we may need to retune or replace.Obtaining the requiredspectrum to qual

293、ify for broadband licenses may take longer and be more expensive than we currently anticipate.In addition,as discussed in more detail below,incumbents may elect not to sell or swap their existing channels on reasonable terms,or at all,and until we can satisfy the 90%Broadband Segment Test,wewill not

294、 be able to utilize the Mandatory Retuning procedures the FCC established in the Report and Order.If we are unable to obtain broadband licenses onfavorable terms and on a timely basis,or at all,our business,liquidity,results of operations and prospects will be materially adversely affected.In additi

295、on,significant costs or delays beyond what we have anticipated in our business plan will further delay us from commercializing our spectrum assets,and mayprevent us from returning capital to stockholders(through dividends or stock repurchases)and require us to seek additional sources of capital and

296、liquidity inorder to carry out our business and plans,which could cause significant dilution to our existing stockholders.See the risk factor entitled“We may not be able tocorrectly estimate our operating expenses or future revenues,which could lead to cash shortfalls and require us to secure additi

297、onal financing.”The voluntary exchange process established by the FCC in the Report and Order may not allow us to clear or relocate incumbents in a timelymanner and on commercially reasonable terms,or at all.The Report and Order establishes a market-driven,voluntary exchange process for clearing the

298、 channels in the broadband segment on a county-by-county basis.When we apply for a broadband license,we will need to demonstrate that we satisfy the 90%Broadband Segment Test.The fact that we will needto account for 90%of the licensed channels in the broadband segment before we can file for a broadb

299、and application,can lead to holdouts by CoveredIncumbents.For example,a Covered Incumbent may demand compensation in an amount that is disproportionate to the cost of relocating its system or anyreasonable reflection of the value of its spectrum holdings or may elect not to negotiate an agreement at

300、 all.In the Report and Order,the FCC has establishedthe 90%Broadband Segment Test,which if satisfied,triggers a Mandatory Retuning process to help a broadband applicant clear the remaining channels in thebroadband segment.There is no assurance,however,that we can swap or acquire sufficient channels,

301、including purchasing additional spectrum,swappingspectrum or entering into protective agreements with Covered Incumbents,to satisfy the 90%Broadband Segment Test on a timely basis and on commerciallyreasonable terms,or at all.Further,even if we satisfy the 90%Broadband Segment Test,as part of the Ma

302、ndatory Retuning process we will be required to payany costs associated with providing Covered Incumbents with comparable facilities and paying relocation costs.In addition,the FCC has exempted channels from the Mandatory Retuning process that are being utilized by incumbents operating Complex Syste

303、ms.The FCC exempted Complex Systems from the Mandatory Retuning requirements because retuning these systems could be complex and disruptive to theincumbent operators.Complex Systems are located in some of the largest business and population centers in the United States.Most are operated by electricu

304、tilities,including some utilities that actively opposed our 900 MHz broadband spectrum initiatives that resulted in the Report and Order.This exemptioneffectively prevents us from obtaining broadband licenses in counties where these Complex Systems are located(or if a Complex System is being operate

305、dwithin 70 miles of a county boundary for which we are attempting to obtain a broadband license)without the incumbents consent,which could be withheld forany reason,or for no reason.As a result,the incumbents operating Complex Systems can make demands that are not commercially reasonable(including t

306、hecommercial terms of any long-term lease of our spectrum),delay their decision or refuse to negotiate with us altogether.Our inability to obtain broadbandlicenses in counties where Complex Systems are currently being operated(or are being operated within 70 miles of a county boundary for which we a

307、reattempting to obtain a broadband license)could have a material adverse effect on our operations and business plan,our future prospects and opportunities andon our ability to develop a profitable business.The members of the AAR may delay or hinder our ability to commercialize broadband licenses.The

308、 AAR holds a nationwide geographic license for six non-contiguous channels in the 900 MHz band,three of which are located within thebroadband segment established by the FCC in the Report and Order.These channels are used by freight railroads for Advanced Train Control Systemoperations.We recognized

309、from the outset of the 900 MHz proceedings the importance of reaching agreements with the railroads about their relocation andworked with them throughout the FCC process.The Report and Order acknowledged the agreement we had reached with the AAR.In January 2020,weformalized our AAR Agreement with th

310、e AAR in which we agreed to cancel licenses in the 900 MHz band to enable the AAR to relocate its operations,including operations utilizing the three channels located in the 900 MHz broadband segment.We cancelled these licenses in June 2020 in accordance with theAAR Agreement.Delays by members of th

311、e AAR in clearing their channels in the broadband segment could delay or hinder our ability to commercializebroadband licenses and the ability of our customers toPage 18Table of Contentsdeploy 3/3 MHz broadband networks in the affected area,which could have a material adverse effect on our operation

312、s and business plan,our future prospectsand opportunities and on our ability to develop a profitable business.We may not be successful in commercializing our spectrum assets on a timely basis or in accordance with our business plans and expectations.We have identified utilities and other critical in

313、frastructure enterprises as our initial target customers.As of the date of this filing,we have signed long-term leases of our spectrum assets with Ameren and Evergy and have entered into a contract to sell our spectrum assets to SDG&E.Although we are indiscussions with other utilities and critical i

314、nfrastructure enterprises,there is no assurance that these discussions will continue to progress or eventually result incontracts with these entities or that we will be successful in our efforts to commercialize our spectrum assets and other service offerings.For example,utilitiesor other critical i

315、nfrastructure enterprises may not elect to lease any broadband licenses we secure on terms satisfactory to us or for a lease amount thatrepresents what we believe is the fair market value for the lease of our spectrum,on a timely basis,or at all.Similarly,there is no assurance that utilities orother

316、 critical infrastructure customers will retain us for any other value-added services we offer them.As a result,our prospects must be considered in light ofthe uncertainties,risks,expenses and difficulties frequently encountered by companies in their early stages of implementing a new business plan a

317、nd pursuingopportunities in highly competitive and rapidly developing markets.In addition,under our current business plan,we intend to enter long-term leasing or other transfer arrangements for our spectrum assets with onecustomer,or a limited number of customers,in each geographic area.We also expe

318、ct that our customers will pay what we believe is the fair market value forthe lease of the spectrum and bear the costs of deploying and operating their private broadband networks.As a result,many geographic areas may have onlyone or a limited number of potential customers and if we are not successf

319、ul with this customer or limited number of customers,our spectrum may not beutilized,and we will not be able to generate revenues from owning spectrum in that geographic area.In addition,even if we enter a long-term lease or transferarrangement for a geographic area,payments by our customer will be

320、contingent on our ability to clear incumbents and take the other necessary actions tosecure broadband licenses on a timely basis.Our customers also will typically require rights to all spectrum we have in its geographic operating area.Becauseof this,we may not have additional spectrum assets to leas

321、e in such geographical area to other potential customers.Further,other than our lease or transferarrangements,we will not generate revenue from the operation of the broadband networks or technologies deployed by our customers.As a result,there isconsiderable uncertainty as to whether we can generate

322、 sufficient revenues to develop a profitable business from leasing or otherwise transferring our licensed900 MHz spectrum on a timely basis,or at all.Our ability to successfully commercialize our spectrum assets will also depend on the commercial availability of technology,products and solutionsthat

323、 can both utilize the broadband licenses we secure and satisfy our customers demands.Our spectrum assets are located within the 3GPP global standard ofBand 8(also known as the E-GSM band,or 880-915 MHz paired with 925-960 MHz).Band 8 has been internationally approved and is currently beingutilized w

324、ith LTE broadband networks.However,we may not be able to continue to convince chipmakers and other technology,product and solutionmanufacturers and vendors to develop the technology,products and solutions required to satisfy our customers various use cases and meet the technicalspecifications establ

325、ished in the Report and Order.Further,adverse economic conditions,including as a result of COVID-19,may result in supply chain issueswhich limit our customers ability to obtain the necessary technology and products to deploy an LTE broadband network utilizing our spectrum.If suchtechnologies,product

326、s and solutions are not available or competitively priced or are significantly delayed,our customers may decide not to lease anybroadband licenses we secure on acceptable terms,on a timely basis,or at all.Further,our assessment that we should target utilities and other critical infrastructure entiti

327、es as customers for our spectrum is based on ourdetermination that these entities have regulatory and other incentives to install a significant number of new technologies,such as smart devices and sensors,that will generate an increasing amount of data that cannot be addressed well by their existing

328、 communication networks and systems.Our potential customers,however,are large organizations and a decision to implement private broadband networks,technologies and solutions is an involved decision and will requiresignificant capital outlays.Any negotiation and contract process with these potential

329、customers has taken,and likely will continue to take,a significant amountof time and effort to work through their approval and funding processes.In addition,there is no assurance that the governmental agencies that regulate theseentities will allow them to pass the capital costs of implementing broa

330、dband networks,technologies and solutions utilizing our spectrum on to their ratepayers,which could cause these entities to be unable to afford,or to elect not to pursue,rights to our spectrum assets.In addition,although there is broad availability ofbroadband LTE,there is no assurance that our targ

331、eted customers will be able to utilize existing broadband networks,technologies and solutions with ourspectrum for their desired use cases without requiring modifications to existing equipment or engaging in product and/or service development efforts,any ofwhich could result in deployment delays,req

332、uire them or us to invest in technology or other development activities or otherwise adversely limit the potentialbenefits or value of our spectrum assets.If any of these risks occur or continue beyond our plans and expectations,our plans to commercialize our spectrumassets may not be as valuable as

333、 we expect and we may experience significant delays in our commercialization plans,which will have an adverse effect on ourbusiness,liquidity,results of operations and prospects.Page 19Table of ContentsWe are subject to contingencies and obligations under our commercial agreements with Ameren,SDG&E and Evergy,including the delivery ofcleared spectrum and broadband licenses on a timely basis,and as