Maritime Launch Services Issues Private Placement Offering

If Maritime Launch Services is going to keep to its revised development plan it will need to secure funding for the first phase of that plan. To that end, the company is offering a private placement of unsecured convertible debentures with a minimum gross proceeds of $2 million. Maritime Launch Services (MLS) announced the non-brokered private placement on November 17, 2023 and is expected to close on or before December 8, 2023. In the press release MLS said "the Debentures will bear cash interest ('Cash Interest') at a rate of 10% per annum, payable quarterly, as well as paid in-kind interest ('PIK Interest') consisting of 5% of the outstanding Debentures in common shares of the Company (a 'Common Share') at a price of $0.12 per Common Share and, unless repaid or converted, will mature 12 months from the date of issuance (the 'Maturity Date')." Should MLS be successful in raising the funds another measure will help the company as it invests those funds in building the additional needed infrastructure to support the launch of a small launch vehicle. In September, MLS received an initial qualification of more than $13 million from the Nova Scotia Capital Investment Tax Credit Program (CITC). Nova Scotia states the CITC “is a refundable corporate tax credit that can be claimed for capital costs directly related to acquiring qualified property for use in Nova Scotia as part of an approved project.” With 2024 almost upon us MLS stated in October that they would embark in the second quarter of 2024 the start of their Dedicated Altitude Research and Testing (DART) program. At the time MLS said Steve Matier, CEO told SpaceQ that the DART program will offer researchers a variety of opportunities including “building and testing new concepts, high speed tracking, conducting research, and testing payloads intended for future orbital missions as well as upper atmospheric monitoring and sampling.” On November 14th MLS released its interim financial statements along with the Management Discussion and Analysis (MD&A). For the three month period ending on September 30, 2023 the company showed a net loss and comprehensive loss of $1,001,323 and for the nine month period September 30, 2023 the company showed a net loss and comprehensive loss of $3,526,874. The net loss and comprehensive loss is down as compared to the previous nine month period in 2022 where the company reported a net loss and comprehensive loss of $6,288,011. Of note in the Management Discussion and Analysis is the following statement with regards to potential small class vehicles. "The Company is currently down selecting from no less than seven companies that have had successes with their vehicle development programs. Most of these have facility needs that are similar which allows for the site development for the launch support infrastructure to continue while the best in class becomes clear. The Company will complete the down selection for the first orbital launch in 2024 by the end of Q1 in 2024. Two candidates the Company is continuing to evaluate and have signed letters of intent with are Reaction Dynamics Lab Inc. ('Reaction Dynamics') and UK-based Skyrora Ltd ('Skyrora'). The other five are at similar or more advanced stages in their launch heritage development. Payload capacities range from 150 kg to 1,250 kg across the seven launch vehicles being evaluated and all represent solid prospects for early Flight Heritage and to generate revenue for the Company. All of these prospective vehicles are 'containerized', in that they come in trailers and require minimal facility infrastructure to begin early launches from Spaceport Nova Scotia. All of the facility support development required for the small class launchers also has direct applicability to all the future launch facility needs." With respect to the Cyclone 4M Medium class launch vehicle MLS wants to get into service sometime in 2025, the company stated the following. "The Russian invasion of Ukraine has not had any physical effect on the development of the Cyclone 4M but has delayed the development plans for the launch vehicle. As noted throughout this MD&A, the company has mitigated the delay by focusing on bringing other launchers to the site under a lease model that could serve the satellite market, generate revenue and add flight heritage for the company. This model requires no investment in a launch vehicle and requires significantly less investment in infrastructure to achieve flight readiness. This model has the ability to stand alone without the Ukrainian vehicle. We remain committed to the longer term medium launcher from Ukraine as that situation develops but is not vital to our ongoing plans. We remain in close contact with our suppliers Yuzhnoye and Yuzhmash in Dnipro, Ukraine and with the Ukrainian space agency including the completion of the preliminary design for the entire Space Launch System, development of the launch site concept of operations and the development of the Interface Control Documents (ICDs) necessary for integration into the spaceport complex."