BlackSky Technology Inc.

Current report

The following risk factors supplement and should be read in conjunction with those risk factors referenced above.

Current report

Risks Related to Our Indebtedness and Alternative Financings

Current report

Our ability to generate the amount of cash needed to pay interest and principal on our outstanding indebtedness and our ability to refinance all or a portion of our indebtedness or obtain additional financing depend on many factors beyond our control.

Current report

Our ability to make scheduled payments on, or to refinance our obligations under, our existing debt agreements including convertible notes, depends on our financial and operating performance and prevailing economic and competitive conditions.

Current report

If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay capital expenditures, sell assets, restructure our debt, or obtain additional equity capital or debt financing on terms that may be onerous or highly dilutive. However, there is no assurance that such alternative measures may be successful or permitted under the agreements governing our indebtedness and, as a result, we may not be able to meet our scheduled debt service obligations. In the absence of such results of operations and resources, we could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations, which could harm our business, financial condition, and results of operations.

Current report

We cannot guarantee that we will be able to refinance our indebtedness or obtain additional financing on satisfactory terms or at all, including due to existing liens on our assets or our level of indebtedness and the debt incurrence restrictions imposed by the agreements governing our indebtedness. In addition, any of our future debt agreements may contain restrictive covenants that may prohibit us from adopting any of these alternatives. Our failure to comply with these covenants could result in an event of default which, if not cured or waived, could result in the acceleration of our debt.

Current report

Further, the cost and availability of credit are subject to changes in the economic and business environment. If conditions in major credit markets deteriorate, our ability to refinance our indebtedness or obtain additional financing on satisfactory terms, or at all, may be negatively affected.

Current report

In addition, upon conversion of the notes, unless we elect to deliver solely shares of our Class A common stock to settle such conversion (other than paying cash in lieu of delivering any fractional share), we will be required to make cash payments in respect of the notes being converted. However, we may not have enough available cash or be able to obtain financing at the time we are required to make repurchases of notes surrendered therefor or pay cash with respect to notes being converted. In addition, our ability to repurchase the notes or to pay cash upon conversions of the notes may be limited by law, by regulatory authority or by agreements governing our then-existing indebtedness. Our failure to repurchase notes at a time when the repurchase is required by the indenture covering the notes (the “Indenture”) or to pay any cash payable on future conversions of the notes as required by the Indenture would constitute a default under the Indenture. A default under the Indenture or the fundamental change itself could also lead to a default under agreements governing our then-existing indebtedness. If the repayment of the related indebtedness were to be accelerated after any applicable notice or grace periods, we may not have sufficient funds to repay the indebtedness and repurchase the notes or make cash payments upon conversions thereof.

Current report

The agreements governing our debt permit us, under some circumstances, to incur certain additional indebtedness or obligations. To the extent that we incur additional indebtedness or such other obligations, the risks associated with our leverage described above, including our possible inability to service our debt, would increase.

Current report

Our stock price may fluctuate significantly and you could lose all or part of your investment as a result.

Current report

The trading price of our Class A common stock has been, and may continue to be, volatile. The stock market has experienced extreme volatility in the past and may experience similar volatility moving forward. This volatility often has been unrelated or disproportionate to the operating performance of particular companies. You may not be able to resell your shares at an attractive price due to a number of factors such as those listed in this Risk Factors section and the following:

Current report

•recent and future disruptions in U.S. federal government operations and continued uncertainty regarding government policies, budget and appropriation decisions and processes, including with respect to defense spending, as a result of administration changes, recent Executive Orders and newly enacted laws, geopolitical events and macroeconomic conditions;

Current report

•strategic actions by us or our competitors;

Current report

•any significant change in our management;

Current report

•investor perceptions or the investment opportunity associated with our Class A common stock relative to other investment alternatives;

Current report

•actions by institutional or activist stockholders;

Current report

•general economic and political conditions such as recessions, interest rates, fuel prices, changes in laws and policies affecting trade, including tariffs and trade wars, pandemics, currency fluctuations and acts of war (including ongoing geopolitical tensions, resulting sanctions imposed by the United States and other countries, and retaliatory actions taken by other countries in response to such sanctions) or terrorism; and

Current report

•the effects of natural disasters, terrorist attacks and the spread and/or abatement of infectious diseases, including with respect to potential operational disruptions, labor disruptions, increased costs, and impacts to demand related thereto.

Current report

These broad market and industry fluctuations may adversely affect the market price of our Class A common stock, regardless of our actual operating performance. In addition, price volatility may be greater if the public float and trading volume of our Class A common stock is low.

Current report

In the past, following periods of market volatility, stockholders have instituted securities class action litigation. If we are involved in securities litigation, it could have a substantial cost and divert resources and the attention of our executive management from our business regardless of the outcome of such litigation. See Item 3. Legal Proceedings and Note 15 —“Commitments and Contingencies” of the notes to the consolidated financial statements for a discussion of current litigation.

Current report

If the estimates we make, or the assumptions on which we rely, in preparing our condensed consolidated financial statements are incorrect, our actual results may vary from those reflected in our projections and accruals.

Current report

Our condensed consolidated financial statements have been prepared in accordance with Generally Accepted Accounting Principles in the United States of America (“GAAP”). The preparation of these condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of our assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. We cannot assure you, however, that our estimates, or the assumptions underlying them, will be correct.

Current report

Further, from time to time we issue financial guidance relating to our expectations for certain financial measures, which guidance is based on estimates and the judgment of management. If, for any reason, our expectations differ materially from our guidance, we may have to adjust our publicly announced financial guidance. If we fail to meet, or if we are required to change or update any element of, our publicly disclosed financial guidance or other expectations about our business, our Class A common stock price could decline.

Current report

We currently benefit from smaller reporting company status pursuant to the rules and regulations promulgated under the Exchange Act, and the reduced disclosure requirements applicable to smaller reporting companies could make it more difficult to compare our performance with other public companies and make our Class A common stock less attractive to investors.

Current report

We currently benefit from smaller reporting company (“SRC”) status and we currently are a non-accelerated filer; therefore, we are eligible for and have in the past taken advantage of exemptions from various reporting requirements that are applicable to other public companies that are not SRCs or non-accelerated filers, including:

Current report

•reduced disclosure obligations regarding executive compensation in our periodic reports, including our Annual Report on Form 10-K, and proxy statements; and

Current report

•providing only two years of audited financial statements in our periodic reports, including our Annual Report on Form 10-K.

Current report

We will continue to benefit from SRC status until the earlier of:

Current report

•the last day of the fiscal year in which the market value of our Class A common stock held by non-affiliates is equal to or exceeds $250 million as of the end of that fiscal year’s second quarter; or

Current report

•our annual revenue for the prior fiscal year was equal to or exceeded $100 million; or the last day of the fiscal year in which the market value of our Class A common stock held by non-affiliates is equal to or exceeds $700 million as of the end of that fiscal year’s second quarter.

Current report

To the extent we take advantage of the exemptions afforded SRCs and non-accelerated filers, our stockholders may not have access to certain information that they may deem important and a comparison of our financial statements to those of other public companies may be difficult or impossible. We cannot predict if investors will find our Class A common stock less attractive if we choose to rely on any of these exemptions. If some investors find our Class A common stock less attractive because we rely on any of these exemptions, there may be a less active trading market for our Class A common stock and our stock price may be more volatile and may decline. We will no longer be able to benefit from SRC status for filings for periods beginning with January 1, 2026.

Current report

Anti-takeover provisions in our organizational documents and in the Indenture could delay or prevent a change of control.

Current report

These provisions provide for, among other things:

Current report

•a classified board of directors whose members serve staggered three-year terms;

Current report

•certain limitations on convening special stockholder meetings;

Current report

•limiting the ability of stockholders to act by written consent;

Current report

•providing that our board of directors is expressly authorized to make, alter or repeal our bylaws; and

Current report

•the removal of directors only for cause and only upon the affirmative vote of holders of at least 66 2/3% of the voting power of our issued and outstanding capital stock entitled to vote in the election of directors, voting together as a single class.

Current report

Certain provisions in the Indenture may also make it more difficult or expensive for a third party to acquire us. For example, the Indenture requires us, in certain circumstances, to repurchase the notes for cash upon the occurrence of a fundamental change and, in certain circumstances, to increase the conversion rate for a holder that converts its notes in connection with a make-whole fundamental change. A takeover of us may trigger the requirement that we repurchase the notes and/or increase the conversion rate, which could make it more costly for a potential acquirer to engage in such takeover. Such additional costs may have the effect of delaying or preventing a takeover of us that would otherwise be beneficial to investors.

Current report

These anti-takeover provisions could make it more difficult for a third party to acquire us, even if the third-party’s offer may be considered beneficial by many of our stockholders. As a result, our stockholders may be limited in their ability to obtain a premium for their shares. These provisions could also discourage proxy contests and make it more difficult for you and other stockholders to elect directors of your choosing and to cause us to take other corporate actions you desire. See “Description of Securities” filed as an Exhibit to our Annual Report on Form 10-K and the “Indenture” filed as an Exhibit to this Quarterly Report on Form 10-Q for more information.

Previous report — wording carried elsewhere

On December 15, 2022, we entered into an "at the market" (ATM) sales agreement with Jefferies LLC as our sales agent, under which we may offer and sell from time to time up to $75 million of shares of our common stock in negotiated transactions or transactions that are deemed to be an ATM offering. During the three months ended