Asset Purchase Agreement

9 Months Ended

Sep. 30, 2025

Asset Purchase Agreement

Asset Purchase Agreement

5. Asset Purchase Agreement

On March 7, 2024, the Company and its wholly-owned subsidiary Progeny LMS, LLC entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Telesaurus Holdings GB and Skybridge Spectrum Foundation to acquire (1) certain Multilateration Location and Monitoring Service licenses (the “M-LMS Licenses”) issued by the FCC and (2) rights to a petition for reconsideration, dated December 20, 2017, which, if granted, may reinstate additional M-LMS Licenses owned by the sellers and terminated by the FCC in 2017 (the "Transaction").

The consideration for the Transaction was as follows:

	$2.5  million in cash consideration within 30 days of the approval of the Transaction by the Superior Court of the State of California, County of Alameda (the “Alameda Court Approval”);
	$7.5 million in shares of NextNav common stock on the earlier of the approval by the FCC of the application seeking the transfer and assignment of the M-LMKS Licenses to the Company (the “FCC Approval”) or, if no action has been taken by the FCC, November 15, 2024 (payable regardless of whether the closing of the Transaction occurs  (the “Closing”) (“First Noncash Consideration”); and
	$20.0 million in shares of NextNav common stock within 30 days of the assignment of the M-LMS Licenses at Closing, contingent upon FCC Approval (the “Closing Consideration”).

On March 28, 2024, the Company received the Alameda Court Approval and made a cash payment of $2.5 million in April 2024. The Company also recognized a liability and asset of $9.8 million as of March 31, 2024 with respect to the fair value of shares expected to be issued (based on a 20-day volume weighted average price of $5.04 and share price of $6.58) equivalent to the $7.5 million First Noncash Consideration, as the payment obligation was based upon passage of time and was not contingent. On November 15, 2024, the Company settled the First Noncash Consideration liability by issuing 620,106 shares of NextNav common stock (based on a 20-day volume weighted average price of $12.09), which had a fair value of $8.8 million (based on a share price of $14.22 upon issuance) that resulted in a gain of $1.0 million, which is recorded in other income (loss), net in the consolidated statement of comprehensive loss for the year ended December 31, 2024, as a result of the difference between the fair value of the shares issued on November 15, 2024 and the fair value of the shares that were expected to be issued for the First Noncash Consideration liability based on the 20-day volume-weighted average price on March 31, 2024.

On June 20, 2025, the FCC issued a Memorandum and Order consenting to the assignment of 128 M-LMS licenses pursuant to the Asset Purchase Agreement.  Subsequently, an application for review was filed by a party with interests in terminated M-LMS licenses not related to this transaction. The Company filed a response to the application for review on August 4, 2025 and no further applications or objections were filed.

The Transaction closed on September 19, 2025 (“Closing”). In connection with the Closing, the Company issued 1,194,820 shares of common stock equivalent to the $20 million Closing Consideration.

Prior to Closing, the Company had a total of $12.6 million related to the Asset Purchase Agreement recognized within other assets in the Consolidated Balance Sheet, which was comprised of the $2.5 million cash consideration, $0.3 million in qualifying direct transaction costs, and $9.8 million related to the First Noncash Consideration.

Upon Closing, the Company:

         Released the prepaid consideration of $12.6 million from other assets in the Consolidated Balance Sheet; and

         Recognized the acquired M-LMS Licenses as intangible assets in the Consolidated Balance Sheet at a value of $33.0 million, which was comprised of (i) $12.6 million prepaid consideration and (ii) $20.4 million related to the fair value of shares issued for Closing Consideration (based on closing date share price of $17.07)

The acquired M-LMS Licenses are classified as indefinite-lived intangible assets in the Company’s Consolidated Balance Sheet. The Company reevaluates the useful life determination for wireless licenses each year to determine whether events and circumstances continue to support an indefinite useful life. See Note 2 — Summary of Significant Accounting Policies.

The Asset Purchase Agreement provides for additional contingent consideration in the amount of $20 million, payable in shares of NextNav common stock. Payment of this additional consideration is contingent upon the FCC granting additional flexibility in the use of M-LMS spectrum, including the M-LMS spectrum covered by the acquired M-LMS Licenses. On April 16, 2024, the Company petitioned the FCC to commence a rule making to reconfigure and update the rules governing the Lower 900 MHz band plan to allow additional flexibility in the use of M-LMS spectrum (the “Petition”). The FCC’s review of the Petition is pending.