Satellogic Announces $30M Strategic Investment From Tether Investments Limited

$30 Million Secured Convertible Notes Provides Additional Operating Liquidity and Financial Flexibility

Satellogic Inc. (NASDAQ:SATL) ("Satellogic" or the "Company"), a leader in sub-meter resolution Earth Observation ("EO") data collection, today announced that Nettar Group, Inc. (the "Borrower"), a wholly-owned subsidiary of the Company, entered into a Note Purchase Agreement (the "Note Purchase Agreement") led by Tether Investments Limited (the "Purchaser"), pursuant to which the Borrower agreed to issue floating rate secured convertible promissory notes in the aggregate principal amount of $30 million (the "Secured Convertible Notes") to the Purchaser (the "Offering"). The net proceeds from the Offering, after deducting transaction fees and other debt issuance costs, were approximately $27.6 million. The Borrower has the ability to issue additional Secured Convertible Notes, provided the aggregate principal amount outstanding does not exceed $50 million.

"The proceeds from Tether's investment in Satellogic will help advance our mission as we continue to focus on our U.S. strategy, the National Security market, and our global Space Systems opportunities," said Emiliano Kargieman, CEO & Founder of Satellogic.

"This new facility will provide necessary funding as we look to continue expanding in 2024," added Rick Dunn, CFO of Satellogic.

The Secured Convertible Notes initially bear interest at a rate of SOFR plus 6.50% per annum, subject to an additional 4.0% per annum if certain events of default occur and are continuing. The Secured Convertible Notes are guaranteed by the Company and each of the Company's material subsidiaries (other than the Borrower), and are secured by substantially all of the Company's and its subsidiaries' assets (including all of its and their intellectual property). As noted above, the Borrower may issue additional Secured Convertible Notes under the terms thereof to other third parties, provided the aggregate principal amount outstanding does not exceed $50 million. The Secured Convertible Notes mature on April 12, 2028.

The Secured Convertible Notes are convertible into shares of the Company's Class A ordinary share (the "Class A Ordinary Shares") at an initial conversion price of $1.20 (or 833 Class A Ordinary Shares per $1,000 principal amount of Secured Convertible Notes), subject to customary anti-dilution adjustments. Conversion of the Secured Convertible Notes held by the Purchaser into Class A Ordinary Shares is subject to CFIUS Approval (as defined in the Secured Convertible Notes).

In the event of an asset sale by the Company (outside the ordinary course of business) or an insurance or condemnation event that results in net proceeds to the Company in excess of $2 million, the Borrower will be required to offer to prepay the Secured Convertible Notes up to the amount of the relevant proceeds at par (unless such proceeds are used to purchase comparable assets within six months). In the event the Secured Convertible Notes are accelerated as a result of an event of default, the Borrower must pay a prepayment penalty equal to 5% of the greater of (i) the outstanding principal amount of Secured Convertible Notes and (ii) the then-prevailing conversion value. In connection with a change of control of the Company (including delisting of the Company's Class A Ordinary Shares), the holder has the right to require the Borrower to repurchase the Secured Convertible Notes for cash at a price equal to the greater of (a) 105% of the redemption value of the Secured Convertible Notes and (b) 105% of the then-prevailing conversion value, plus accrued but unpaid interest thereon, as well as any other amounts owed (the "Put Price"). The Borrower also has the right to repurchase or force-convert the Secured Convertible Notes in connection with a full acquisition of the Company at the Put Price.

The Secured Convertible Notes contain certain restrictive covenants, including restrictions on (i) incurring indebtedness, subject to certain exceptions (including the ability to issue additional Secured Convertible Notes; provided the aggregate principal outstanding amount does not exceed $50 million), (ii) creating certain liens, subject to certain exceptions, (iii) the payment of dividends or other restricted payments, (iv) the sale, transfer or otherwise conveyance of certain assets, subject to the asset sale prepayment described above, and (v) certain affiliate transactions.

In connection with the Offering, the Company also entered into with the Purchaser (i) a side letter, pursuant to which the Purchaser will be entitled to pre-emptive rights in order to maintain its as-converted ownership percentage on the same basis as new capital raised and (ii) a registration rights agreement, pursuant to which the Company agreed to register for resale the Class A Ordinary Shares issuable upon conversion of the Secured Convertible Notes.

The offer and sale of the Secured Convertible Notes are not being registered under the Securities Act of 1933, as amended (the "Securities Act"), or the securities laws of any other jurisdiction. The Secured Convertible Notes may not be offered or sold in the United States except in transactions exempt from, or not subject to, the registration requirements of the Securities Act and any applicable state securities laws.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of securities of the Borrower or the Company in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or jurisdiction.