Aerkomm Inc. · OTC:AKOM
Aerkomm — Investor Presentation (May 2020)
44 slides from Aerkomm's investor presentation, May 5, 2020
Slide 1: Aerkomm Investment Memorandum
INVEST CORPORATE AERKGMM Fl NANCE SMARTER. SAFER. CONNECTED. CONFIDENTIAL ; NOT FOR DISTRIBUTION AERKOMM INVESTMENT MEMORANDUM AERKOMM
Slide 2: Disclaimer
DISCLAIMER 1/5 THIS CONFIDENTIAL PRESENTATION IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, FRANCE OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICT
Slide 3: Disclaimer
DISCLAIMER You acknowledge and agree that this Confidential Presentation is being provided to you solely to assist in the initiation of your independent investigation of an investment in the Company, and in particular, does not contain disclosure of the risks associated with such an investment. This
Slide 4: Disclaimer
DISCLAIMER This Confidential Presentation is only addressed to and directed to persons: (i) solely outside the United States who are not “U.S. persons” in “offshore transactions” in each case as defined in Rule 902 of Regulation S (“Regulation S”) under the U.S. Securities Act of 1933, as amended (t
Slide 5: Disclaimer
DISCLAIMER If you are not permitted to view this Confidential Presentation or other materials furnished in connection with this Confidential Presentation or are in any doubt as to whether you are permitted to view this Confidential Presentation or other materials furnished in connection with this Co
Slide 6: Disclaimer
DISCLAIMER We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and
Slide 7: Table of Contents
INVEST CORPORATE FINANCE TABLE OF CONTENTS 1. EXECUTIVE SUMMARY 2. A PROMISING UNDERLYING MARKET 3. A WIDE SERVICE OFFERING BASED ON AN INNOVATIVE TECHNOLOGY 4. DESCRIPTION OF THE BUSINESS MODEL 5. A STRATEGIC LAND ACQUISITION IN TAIWAN 6. CURRENT STATUS OF ONGOING AGREEMENTS 7. A SEASONED MANAGEMEN
Slide 8: Executive Summary
INVEST CORPORATE FINANCE EXECUTIVE SUMMARY m AERKOMM’s overview = Historical milestones = Investment criteria = Corporate structure | INVESTMENT MEMORANDUM | 2020 AERKOMM A\Y
Slide 9: Executive Summary: AERKOMM's overview
1. EXECUTIVE SUMMARY gm AERKOMM’s overview development stage service provider of In-Flight Entertainment and Connectivity (IFEC) x2 An underlying market set to _A full range of services: Both Built In-Flight double in size in 20 years streaming, search engine, entertainment systems (from 4 bn passen
Slide 10: Executive Summary: Historical milestones
10 1. EXECUTIVE SUMMARY m Historical milestones 2018.12 Signed Firm Agreement with = @ 2016.01 ~~ wy AIRBUS Entered into MOU with 1 Lety ‘yaxoot 2017.02 J ¢ Aircom Pacific 2019.03 = “ » completed reverse ‘ acquisition to become { } wholly owned subsidiary of publich a: SS ¢ traded romneaer ine ra En
Slide 11: Executive Summary: Investment criteria
a 1. EXECUTIVE SUMMARY = Investment criteria A promising underlying market ® According to LSE report, Inflight connectivity market generated c. $0.9bn of ancillary revenues in 2018 and is expected to reach $30bn by 2035 and number of passengers is expected to grow from 4 billion in 2018 to 8 billion
Slide 12: Executive Summary: Corporate structure
1. EXECUTIVE SUMMARY = Corporate structure Aerkomm Inc (Nevada) Aerkomm Taiwan Inc (Taiwan) Aircom P. A Aircom Telecom Aircom Japan, Inc. Aircom Pacific Ltd. Ltd (Hong LLC (Taiwan) (Japan) (Seychelles) Beijing Tatai mmunication Co Ltd (China) Aerkomm Pacific Ltd (Malta) Cc) Shareholders GD toiaing r
Slide 13: A Promising Underlying Market
INVEST CORPORATE FINANCE A PROMISING UNDERLYING MARKET m A steady increase in number of commercial aircraft as a key driver of the underlying market @ Expected in-flight Wi-Fi services revenue evolution m™ FOCUS on AERKOMM competitive framework | INVESTMENT MEMORANDUM | 2020 AERKOMM A\Y
Slide 14: Steady increase in number of commercial aircraft
2. A PROMISING UNDERLYING MARKET = A steady increase in number of commercial aircraft as a key driver of the underlying market COMMERCIAL AIRCRAFT FLEET Number of commercial aircraft = There are currently more than 23,000 commercial aircraft flying nanlaaen globally, a number that has been expected
Slide 15: Expected in-flight Wi-Fi services revenue evolution
15 2. A PROMISING UNDERLYING MARKET = Expected in-flight Wi-Fi services revenue evolution IN-FLIGHT WI-FI MARKET According to the London School of Economics (“LSE”) report, broadband enabled ancillary revenue was forecasted at USSO.9 billion for 2018. The LSE study estimates that this revenue would
Slide 16: Focus on AERKOMM competitive framework
2. A PROMISING UNDERLYING MARKET = FOCUS on AERKOMM competitive framework FASTER TECHNOLOGY FREE FOR PASSENGERS AND AIRLINES. AERKGMM oye Panasonic foe THALES ol = = (@) = on x x ¥ x x x x v x v v x v x ov x v v v v v v v v . re 7 ~ x x x v Po Cost of equipment/ connectivity for the _<Be\ —>5 —) > 5
Slide 17: Main competitors
2. A PROMISING UNDERLYING MARKET = FOCUS on AERKOMM competitive framework MAIN COMPETITORS ¢ p> GoGo Inflight Internet ° Launched in 2008 with Air to Ground (ATG) technology. ATG technology offers 3Mbit/s per flight. IPO on June 21, gogo 2013 at $17 per share. 2Ku band connectivity. GOGO is well est
Slide 18: A Wide Service Offering Based on an Innovative Technology
INVEST CORPORATE FINANCE A WIDE SERVICE OFFERING BASED ON AN INNOVATIVE TECHNOLOGY = Description of the services to be provided = From old-fashioned entertainment service to a full and up-to-date service = Anantenna produced in the United States = A competitive advantage due to hybrid GEO/LEO techno
Slide 19: Description of the services to be provided
19 3. A WIDE SERVICE OFFERING BASED ON AN INNOVATIVE TECHNOLOGY = Description of the services to be provided AERKOMM WILL BRING CONNECTIVITY ON BOARD AIRCRAFT AND PROVIDE IN-FLIGHT ENTERTAINMENT ig connectivity solutions on board aircraft wi satellite communi CULL QULLLLLLLLLLLLLLLLLOLLLL AirCinema
Slide 20: From old-fashioned entertainment to a full up-to-date service
3. A WIDE SERVICE OFFERING BASED ON AN INNOVATIVE TECHNOLOGY = From old-fashioned entertainment service to a full and up-to-date service jtes AERKOMM from exi g market players m= Partner with airlines and offer airline passengers free IFEC services m Expect to generate revenue through advertising an
Slide 21: An antenna produced in the United States
3. A WIDE SERVICE OFFERING BASED ON AN INNOVATIVE TECHNOLOGY = An antenna produced in the United States DESCRIPTION OF THE AERKOMM K++ SYSTEM m= The AERKOMM K++ system will be available in-flight thanks to the a DESCRIPTION OF THE ANTENNA ultra-low profile antenna, located at the back of the airplan
Slide 22: Simplified architecture of the equipment installation
3. A WIDE SERVICE OFFERING BASED ON AN INNOVATIVE TECHNOLOGY = Anantenna produced in the United States SIMPLIFIED ARCHITECTURE OF THE EQUIPMENT INSTALLATION 22 | INVESTMENT MEMORANDUM | 2020 AERKOMM A\Y
Slide 23: Competitive advantage due to hybrid GEO/LEO technology
3. A WIDE SERVICE OFFERING BASED ON AN INNOVATIVE TECHNOLOGY = A competitive advantage due to hybrid GEO/LEO technology Overview of current technology used by c: = Most in-flight connectivity systems currently rely on the Ku-band satellite signals for communication = Many players in the market are w
Slide 24: Description of the Business Model
INVEST CORPORATE FINANCE DESCRIPTION OF THE BUSINESS MODEL = The business model @ An innovative revenue sharing business model = A fee-based business model for private jets m= Other markets targeted by AERKOMM | INVESTMENT MEMORANDUM | 2020 AERKOMM A\Y
Slide 25: The business model
4. DESCRIPTION OF THE BUSINESS MODEL m= The business model AERKOMM WILL PROVIDE ON-BOARD CONNECTIVITY USING TWO DIFFERENT BUSINESS MODELS DEPENDING ON THE CAPACITY OF THE TARGET USER TO GENERATE TRAFFIC Free model Business Prepaid model model Targeted users Targeted users. SSSA Type of suppliers and
Slide 26: An innovative revenue sharing business model
26 4. DESCRIPTION OF THE BUSINESS MODEL m= An innovative revenue sharing business model A FREE BUSINESS MODEL BASED ON ADVERTISING REVENUES = Traditionally, providers of in-flight connectivity focus primarily on the profit margin deriving from the sale of hardware to airlines and of bandwidth to pas
Slide 27: A fee-based business model for private jets
27 4. DESCRIPTION OF THE BUSINESS MODEL u A fee-based business model for private jets A PAYING BUSINESS MODEL FOR PRIVATE JET CUSTOMERS = There is a strong demand by corporate jet owners to have high-speed internet connectivity installed on their aircraft. However, corporate jet customers would not
Slide 28: Other markets targeted by AERKOMM
28 4. DESCRIPTION OF THE BUSINESS MODEL = Other markets targeted by AERKOMM REMOTE LOCATION AND HOTELS AND THE MARITIME MARKET WILL ALSO BENEFIT FROM AERKOMM TECHNOLOGY In addition to the strong focus on IFEC systems for aircraft, AERKOMM started to develop related satellite based internet connectiv
Slide 29: A Strategic Land Acquisition in Taiwan
INVEST CORPORATE FINANCE A STRATEGIC LAND ACQUISITION IN TAIWAN = A mandatory land acquisition to build a ground station and obtain the telecommunication license = Expansion potential = A Strategic partnership with a Samoa based telecom company | INVESTMENT MEMORANDUM | 2020 AERKOMM A\Y
Slide 30: Land acquisition for ground station and telecom license
5. ASTRATEGIC LAND ACQUISITION IN TAIWAN = A mandatory land acquisition to build a ground station and obtain the telecommunication license AERKOMM choose to acquire a land parcel in Taiw: or purposes of providing efficient coverage Acquired ACQUIRED LAND Land ground station at a strategic location.
Slide 31: Expansion potential
5. ASTRATEGIC LAND ACQUISITION IN TAIWAN = Expansion potential ly 2019 Construction of Acquisition of Fully Ownership the ground the land of the land Sten initial payment of Payment of the First ground station in $33,850k to acquire remainder ($624k) partnership with a lessee ( the fand ) Geostation
Slide 32: Strategic partnership with a Samoa based telecom company
32 5. ASTRATEGIC LAND ACQUISITION IN TAIWAN = Astrategic partnership with a Samoa based telecom company AERKOMM will benefit fi strategic and sustainable partnership with a S. ja based telecom compa = At the moment, only a binding MOU is effective with the Samoa-based company specializing in Telecom
Slide 33: Current Status of Ongoing Agreements
INVEST CORPORATE FINANCE CURRENT STATUS OF ONGOING AGREEMENTS = Signed agreement with Hong Kong Airlines m AERKOMM has a competitive advantage due to the Service Bulletin with AIRBUS = Ongoing discussions with aircraft manufacturers | INVESTMENT MEMORANDUM | 2020 AERKOMM A\Y
Slide 34: Signed agreement with Hong Kong Airlines
6. CURRENT STATUS OF ONGOING AGREEMENTS m= Signed agreement with Hong Kong Airlines SMARTER. SAFER, CONNECTED. x © HONGKONG AIRLINES =f AERKGMM ig Beams = Aerkomm Inc. ("Aerkomm'" or "the Company"), a development stage service provider of In-Flight Entertainment and Connectivity solutions for the ai
Slide 35: Competitive advantage due to the Service Bulletin with Airbus
35 6. CURRENT STATUS OF ONGOING AGREEMENTS m AERKOMM has a competitive advantage due to the Service Bulletin with AIRBUS DIFFERENCE BETWEEN THE SERVICE BULLETIN AND THE SUPPLEMENTAL TYPE CERTIFICATE (“STC”) = The aeronautical industry is highly regulated. When an aeronautical product needs to be mod
Slide 36: Ongoing discussions with aircraft manufacturers
36 6. CURRENT STATUS OF ONGOING AGREEMENTS = Ongoing discussions with aircraft manufacturers CURRENT NEGOTIATIONS AIRCRAFT MANUFACTURERS = Service Bulletin with AIRBUS = On November 30, 2018, in furtherance of a memorandum of understanding (MOU) signed in March 2018, AERKOMM entered into an agreemen
Slide 37: A Seasoned Management Team and Board of Directors
INVEST CORPORATE FINANCE A SEASONED MANAGEMENT TEAM AND BOARD OF DIRECTORS = Executive Management team m Key members = Board of Directors
Slide 38: Executive Management team
7. A SEASONED MANAGEMENT TEAM AND BOARD OF DIRECTORS = Executive Management team ™ Experienced airline executive with more than 40+ years of experience in the aviation industry is GIORDIMAINA ™ Former CEO of Air Malta and of Lufthansa Technik CEO Malta = Fellow of the Royal Aeronautical Society and
Slide 39: Key members
7. A SEASONED MANAGEMENT TEAM AND BOARD OF DIRECTORS = Key members Joel Palhol John Yang Peter Ho Quality Manager Program Manager A320. Sales & Marketing Manager = Former Quality Manager of Airbus Industrie ™ 30+ Years of experience in software and ™ 30+ years of experience in, and Zodiac Aerospace
Slide 40: Board of Directors
7. A SEASONED MANAGEMENT TEAM AND BOARD OF DIRECTORS = Board of Directors prcccc eee | AuditCommittee -------------; ig = === Compensation Committee and Nominating & Governance Committee = = 1! Jeffrey WUN, CTO and Director of the Board i ~ > 4 ‘ 1 James J, BUSUTTIL, Chairman and Independent Directo
Slide 41: Notes
NOTES
Slide 42: Notes
NOTES
Slide 43: Notes
NOTES
Slide 44: Contacts
INVEST CORPORATE FINANCE INVEST SECURITIES Brokerage firm, investment service provider approved by the Banque de France 73, bd Haussmann - 75008 Paris +33 144 8877 88 Invest-securities.com INVEST CORPORATE FINANCE Financial engineering firm at the service of companies 73, bd Haussmann - 75008 Paris