Kirkland & Ellis advised an ad hoc group of crossholders of over $4 billion in principal amount of debt and equity in Ligado Networks LLC (“Ligado”) in supporting Ligado’s comprehensive balance sheet restructuring, which includes a proposed commercial transaction between Ligado and AST SpaceMobile Inc. and certain of its affiliates (“AST”), through a pre-arranged chapter 11 and an approximately $940 million multi-draw DIP credit facility to finance operations during the pendency of the chapter 11 cases.

Satellite communications company Ligado announced on January 6, 2025 that it had entered into a restructuring support agreement (“RSA”) with stakeholders holding approximately 88% of Ligado’s funded indebtedness (including the ad hoc group represented by Kirkland) and a fully backstopped debtor-in-possession financing facility to support the comprehensive restructuring. The RSA provides, among other things, for the conversion of approximately $7.8 billion of existing debt into new preferred equity, preservation of the existing interests in the capital structure below the new preferred equity, and a commercial agreement with AST in respect of spectrum usage rights. The debtor-in-possession financing facility provides for access to new money financing for Ligado and refinances certain existing debt, subject to bankruptcy court approval and other conditions. To effectuate the restructuring and the financing, as contemplated by the RSA, Ligado commenced voluntary cases in the Bankruptcy Court for the District of Delaware under Chapter 11 of the United States Bankruptcy Code, and Ligado will file a recognition proceeding in Canada.

Under the commercial agreement with AST, AST has agreed to provide Ligado, subject to certain conditions precedent, with approximately $113 million of AST warrants and usage rights payments to fund Ligado’s payments under certain spectrum agreements. Additionally, Ligado will receive economic participation in AST’s direct-to-device business in the U.S. and Canada. In exchange for these payments, AST will receive usage rights to Ligado’s L-Band mobile satellite services (MSS) spectrum. The commercial transaction with AST is subject to court approval and entry into definitive documentation.