Sonim Technologies, Inc., a leading U.S. provider of ultra-rugged mobile devices, accessories and solutions designed specifically for task workers physically engaged in their work environments, announced that it has closed the first tranche of its subscription agreement with U.S.-based AJP Holding Company, LLC (“AJP”) whereby AJP will ultimately purchase an aggregate of $17.5 million in Sonim equity at a price of $0.84 per share.
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The first closing includes the purchase of approximately 14.9 million shares of Common Stock for an aggregate purchase price of $12.5 million. At the first closing, AJP acquired approximately 13.9 million shares of Common Stock and Mr. Peter Liu, Sonim’s Chief Executive Officer, acquired 952,381 shares of Common Stock, as designated by AJP. The second closing, for approximately 5.9 million shares of Common Stock for an aggregate purchase price of $5.0 million, is expected to occur on or around August 1, 2022. Upon completion of the transaction, which was approved by stockholders at a special meeting held on June 28, 2022, AJP and Mr. Liu, together, will own approximately 52% of Sonim‘s post-transaction outstanding capital stock based on an estimated 19.3 million shares outstanding prior to the transaction.
The agreement with AJP supports a new strategy whereby Sonim will expand from its core market in ultra-rugged mobile devices into the larger and faster growing semi-rugged and industrial 5G markets. This enhanced strategy proposed by AJP is expected to drive revenue growth, increase operating efficiency, accelerate ODM-based product development at lower cost and broaden Sonim’s addressable market opportunities.
“Sonim’s deep relationships with Tier One mobile carriers in North America have generated almost $16 million in confirmed orders for our next generation rugged devices over the past couple of months, demonstrating the exciting opportunity we hope to tap by bringing a wider array of 5G semi-rugged and industrial devices to market,” said Mr. Liu. “We are moving ahead to leverage our expanded ODM relationships to accelerate new products, reduce development and manufacturing costs and maximize the value of Sonim’s highly regarded brand as we work to make Sonim the top middle market rugged and industrial device provider in North America.”
“We remain on track to launch our new feature phone this summer and new 5G smartphone this fall, with orders for both devices now in hand from major carrier partners. These devices will complete the update of Sonim’s existing rugged product line, allowing us to increase attention on an expanded lineup of 5G products for the larger semi-rugged and industrial markets where carriers need additional product solutions,” added Mr. Liu.