Good afternoon, ladies and gentlemen, and welcome to the Anterix Second Quarter Update Conference Call. At this time, all participants have been placed on a listen-only mode and we will open the floor for your questions and comments after the presentation. It is now my pleasure to turn the floor over to your host, Natasha Vecchiarelli. Ma'am, the floor is yours.

Good afternoon, everyone and thank you for joining us. With me today are Brian McAuley, our Chairman; Morgan O'Brien, our CEO; Rob Schwartz, President and COO; and Tim Gray, our CFO. Before we begin, I'd like to highlight that during our call we will present both GAAP and non-GAAP financial measures. A reconciliation of non-GAAP to GAAP measures is included in today's 8-K which can be found on our Investor Relations page. Please also note that we may make reference to forward looking statements. And our actual results could differ materially from those implied. Information regarding the risk factors that could cause such differences can be found in our public filings, including our most recently filed Form 10-Q for the quarter ended September 30, 2019. With that, I'd like to turn the call over to Morgan O'Brien.

Thank you, Natasha. Thank you, everybody for joining us this afternoon. It's been five years since Anterix proposed to the FCC a modification of the rules at 900 megahertz to permit the operation of a 6 megahertz broadband segment in the band. While no decision is final until the vote of five FCC commissioners and the publication of the final order, we at Anterix are encouraged by recent signs that a positive outcome may be near. For example, on October 9, the wireless bureau of the FCC issued a decision granting a request by Anterix that the licensing freeze be lifted to permit incumbents to file applications to relocate out of the proposed broadband segment. This does not prejudge a rulemaking, of course, but to us, it suggests that the staff is actively considering a broadband allocation as proposed. In addition, the record in the proceeding reflects a number of recent meetings with the bureau staff on issues that we interpret as underlying a favorable decision on the merits of creating a broadband segment and focus on the details of how that process might work. As reflected in a series of ex-party filings made by Anterix, there have been discussions with the FCC on a wide range of technical and operational issues around repurposing the brand. Our experience suggest to us that the staff is getting ready to make final recommendations in the proceeding to the commissioners. And we're optimistic that the outcome will be consistent with the broadband allocation as we have sought. As we continue the regulatory process Anterix has been active on a number of other fronts. Of these, the most important are the steps necessary to be ready immediately upon a final order to clear spectrum and make it available for broadband use, after the recent…

Thanks Morgan and good afternoon, everyone. I'd summarize the theme for this first half of Anterix's fiscal year as momentum. You just heard from Morgan about the continued progress with the FCC and our belief that we're approaching the end zone for near-term report in order. In parallel, I want to highlight three other important areas of Anterix's momentum. First, we're working intensively with a large group of potential customers to both foster and satiate the growing commercial demand of a private LTE solutions. Second, we're continuing to build on our industry wide top-down initiatives are seeing expanding industry support and involvement. And third, we continue to build our operational organization to be commercially ready for a broadband future. So, let me start with our customer progress. Looking broadly at our targeted customer verticals and the critical infrastructure industries they represent, there continues to be increasing awareness movement toward private broadband networks to facilitate their mission critical communications needs. We're seeing this rising tide of interest from electric utilities as well as from other industrial enterprise sectors. There's a growing appreciation for the value of private LTE networks to solve an increasing number of vital use cases for these sectors and scarce options, if any, that provide the advantages of 900 megahertz low band spectrum that works within the existing LTE band standards to secure a cost effective solution. These factors increasingly elevate 900 megahertz to be a preferred choice. As result of this continued increase in market demand, coupled with our expanding team's hard work, we see a seasoning of our pipeline in anticipation of the FCC order as potential customers get a deeper understanding of the full possibilities and value creation of private LTE. Utilities are developing their business cases for more robust telecom capability identified the need…

Thanks, Rob. Good afternoon, everyone. We're more than halfway through our current fiscal year. And as Morgan and Rob discussed, we're pleased with all that we've accomplished. As you know, the second quarter of our fiscal year was highlighted by the equity raise, we completed in July, to provide us with the funding needed to move forward on our business plans. As we advance our retuning efforts for the 900 megahertz spectrum block. We're accelerating our market clearing activities and prioritizing those markets where you believe we have near term customer opportunities, thereby shortening the time to revenue, post an FCC report and order. Although our second quarter retuning spend was minimal, we expect to ramp up in the current quarter and accelerate as we move forward with the process. I've been asked several times about our planet accounting for retuning as we move forward, so I wanted to address it. Any acquisitions this spectrum will continue to be capitalized to our intangible asset, until the report and order is final, retuning costs will be expensed in the general and administrative operating expense line item of our income statement. Post the report in order, returning costs will be capitalized or intangible asset. Our balance sheet continues to be strong as of September 30, 2019 the Company had $157.5 million in available cash and is debt free, the increase in cash in the prior quarter was driven by the $94 million in net proceeds raised in July. Our spent for the quarter was approximately $6 million and was within our expectations before restructuring and spectrum related acquisitions. This spend did include $200,000 and retuning related items and $500,000 in restructuring related payments. Looking at our results, the second fiscal quarter ended September 30, 2019 the Company reported a net loss of $7.7 million or negative $0.46 per share, versus a net loss of $11.8 million or negative $0.81 per share for the same quarter in the previous year. Last year, second quarter included $4.1 million for restructuring related charges due to the realignment of our business. Adjusted EBITDA for the second quarter was negative $6.2 million, compared with negative $7.6 million for the same period in the prior year. The improved performance in fiscal 2020 resulted from lower restructuring related charges offset partially by lower revenue resulting from the transfer of our team Connect businesses, anticipating a decision by the FCC shortly, we're going to be ramping up expenses and returning, continuing to build our commercial team and enhancing our operational readiness. These expense increases will be within our previously mentioned spend parameters and will be necessary to drive our longer term objectives. That concludes our prepared remarks. I'll now turn it back over to the operator for questions.

Thank you ladies and gentlemen, the floor is now open for questions. [Operator Instructions] Your first question is coming from Mike Crawford. Your line is live.

Thanks, Mike Crawford from B. Riley FBR. Given that you are your pipeline is seasoning as you get deeper and discussions of business cases of potential 900 megahertz licensees. Have you found any reason to change your expectation for what revenue model might look like for Anterix with the spectrum leases you anticipate to be entering into?

Thanks, Mike. This is Rob Schwartz. No, I don't see any changes per se. I mean, clearly what we're seeing and we talked about seasoning, you know, we have a really great level of interest from all kinds of parties in the predominance, which are investor-owned utilities. And the level of demand in conversations has been great. The specific conversations around how they want to engage to be able to contract for the spectrum. As we've talked about the past, you know, our core offering is long-term spectrum lease is still there absolutely are folks who would, as you've seen on the record would rather own the spectrum if they could, but clearly, our core model is focused on how we can achieve the same kind of long-term revenue that we talked about it back to Investor Day.

Okay, thanks, Rob. And then also pursuant to your request, the SEC did grant a listing of the freeze to enable querying of incumbents. So, can you quantify, how many parties you might already be working with to do that voluntarily?

Mike, this is Morgan. There were certainly enough to make it worthwhile going in and asking. And, as I said, we were super pleased that bureau took the constructive step of going ahead and saying, don't use the waiver approach because it's too cumbersome. We'll just, permit these things. So enough to be very much worthwhile that we can -- as I say, we have, we now have a lot of the players in place to do this retuning and so they're out there talking to people.

Okay, thank you, Morgan. And then would you expect that the report Nora would come just via circulation or in an official FCC meeting, agenda and meeting?

Mike, I think it's always a question of what the chairman has going in the course of a particular period of time. He may want to bundle a number of spectrum related issues and do it all in a meeting, that's pretty common, or may just take the position that hey, something's ready. It's ready to go. There's an urgency, we've certainly tried to communicate that, let's put it out. So I think every time in the past, we've tried to predict. We haven't been very good about predicting which it is. And I think it's, we'll just have to wait and see. But to emphasize the point I was trying to make earlier, it certainly feels like we're approaching while we've been seeking for so long.

Okay, thank you. And then final question is, are we less likely now to see any kind of MOU with someone before a final report in order so that we would look for that first before we would see any what any potential lease or agreement might look like?

Yes, Mike, it's Rob. So I think clearly, you know, as we've talked about, these are parallel efforts, right. So we've got the FCC process, as we talked about being and we think close to the end zone. At the same time, we were also moving forward with a number of customers. Clearly there are those customers who are going to wait to see report in order before they transact for spectrum. But we're still optimistic that both are moving in parallel.

Your next question is coming from George Sutton. Your line is live.

Thank you. Nice to see the continued progress. So Rob you talked a little bit about PG&E and I just want to use the hypothetical example. If they had your, broadband in place and were sort of fully functional, how might they be operating differently today? Just to give us a perspective of some of the use case examples that would take place.

Sure. And I'll, I'll stick with your hypothetical versus specific to them, but you know, the functionality that a broadband van network and specifically a low band broadband network like our 900 megahertz can enable for utility, especially out in California and trying to combat the wildfires. There's kind of two sides of it. One is, what's done today at some level and clearly not enough is the detection of events occurring, right? So a lot of what you hear about from a technology and or surveillance standpoint is finding fires as fast as possible to put them out. And so sensors and things that there's heat sensors, there's cameras, they're using everything from satellite to helicopter sensing that stuff. So if you had a network available with greater level of sensors that can be deployed way more broadly, and there's these -- there's good maps that show exactly where it's needed. -- the high fire risk zones in those places, there absolutely should be more centers and you can be quicker to respond. But, but more importantly is really the technology that San Diego Gas and Electric has developed and put forward and their wildfire mitigation plan as I cited earlier that really is focused on preventing fires from starting in the first place. And so that's from if you can deploy this on polls that you can really de-power a line in the time it takes to fall to the ground -- before it falls to the ground, then you're preventing a fire from starting. And so that deployed widely also will add some, a much greater ability to prevent fires from starting the first place. The other thing is, we have talked to folks about these PSPS the power shutoffs that are occurring. Some of those happen because there's, there's no physical control of wide areas of, of territory and literally there's trucks rolling out to turn off power and turn back on power. Any greater command of control, which has to be remotely done, communications network is going to enhance that as well. And so those are of three areas where I think there's, there's strong capability to enhance the prevention of fires. Is it going to be perfect in that difficult environment? I don't think anything's going to be perfect, but clearly anytime you can reduce any of the fire incidences, it's going to be highly valued.

Just keeping on the Southern California theme, just today there was an application narrative statement from Southern California. Edison, could you just give us a sense of what that document means?

I'm, I'm not certain of the document referring to today. George, maybe you can give me a little more detail on?

It's a complicated one, which is why I ask. They want to convert to a non-common carrier SMR and add emissions and they want to also add an area of mobile operations?

Yes. Well, we'll have, well, we haven't seen it as we were preparing to go look at all. But we'll have you take a look at it and get back to George and give you a perspective.

Okay. Morgan, you mentioned in your prepared comments that there are other potentially uses of the spectrum, we've seen on the record some things related to oil and gas companies and chemical operators. Can you just give us a sense of what you're referring to in terms of the other potential users

Without, without going into specific discussions that we're having in the category of water and gas, you did see EPS exploration issues like that, perhaps something along the lines of railroads. I mean those are the, those are the kind of critical infrastructure players that are aware of -- newly aware I would say, of what's coming down the road. As I said, it's the positive, the negative amount of time it's taken for this thing to work through the FCC is that there has been a, an awakening as to what broadband does. And a point I want to make really stress is the latency because, I think a lot of people hear the expression latency. And they're really not sure, I know you are. But a lot of them are not sure what it means. It just means the ability of a technology to carry around trip message in milliseconds. And that's what's brand new to these folks, not just the ability to transmit a lot of data, but to deal with that kind of latency.

And, George, to add on to that another, I mentioned CBRS, with the considerable amount of recognition it's getting as it's progressing to the FCC and the industry support that's occurring, as more and more industries are becoming aware of it and the LTE technology that's utilizing, but it's really like campus solution. And so, if people look at it and say, wow, this is really interesting, but I need a wider area of coverage. Like a lot of the industries that Morgan mentioned, as you start looking for what other bands are able to do so. Again, it's a natural complimenting to say, well 900 is a potential solution for that. So it's been a good path for us to also get other folks aware and interested in what we're doing.

But I don't want to buy this kind of answer. I don't want to suggest that we don't still have a firm conviction that the electric utility industry, particularly as it's deployed nationally, there's just all sorts of economies of scale and other reasons why that industry ought to be really riveted on this opportunity. We've certainly done everything we could to divert their attention. I mean we haven't engineered any of these crises that they have. We just see a technology and a spectrum position that can really address these needs that are that are so obvious in places like California.

Great. I'd like to make a special prediction. When we speak next quarter on an earnings call will be talking about business models and potential deals. We won't be talking about FCC processes. Thanks, guys.

Well, let's just say that we're tireless in trying to make that prediction come true.

Your next question is coming from James Radcliffe. Your line is live.

Thanks for taking the question. On the -- mentioned the relatively limited number of areas where you don't have all the MTA blocks. How much of the country does that represent? And particularly, how much of an impediment is it for -- your most attractive or most -- for this advanced customer relationships? Thanks.

I'm glad you gave me an opportunity to clarify this because I want to make the distinction between having all 20 in any particular county when you go in and apply for broadband, and how many of those 20 per county we don't have. So it's, it's basically only 11. But having said that, and going right to your question, we have a long term, very respectful relationship with a major SMR who has positions in Miami and at Boston. And those are obviously major markets of which we have a lot of interest. But other than that, I would say that, I feel like we have that situation pretty well in hand. We, we know we know the players. We are flexible and what we can, what we can do and I don't really see any long term obstacle to getting to that rule of 20 with a one big exception being the railroads. If the FCC accepts the proposal to move the railroads to block A, then wherever it's says 20, it will really mean 19 because the railroads will be sitting on the first block and we've been solidly supportive of the railroads. And you can see if you look at the record that they've been in talking to the FCC about just how important this is to their industry, and we're solidly behind them, and we're hopeful that they will end up with those 10 channels that they can deploy Y band technologies on that.

There are no further questions from the lines at this time.

All right, thank you so much. We're with George and hoping to have plenty of opportunity in the future to talk about good news and thank you so much until next time.

Thank you. Ladies and gentleman this does conclude today's conference call. You may disconnect your phone lines at this time and have wonderful day. Thank you for your participation.