Comtech Comments on ISS Report

MELVILLE, N.Y. –
December 7, 2021– Comtech Telecommunications Corp. (NASDAQ: CMTL), a leading global provider of next-generation 911 emergency systems and secure wireless communications technologies, today issued a statement in response to a report by Institutional Shareholder Services (“ISS”) regarding the election of directors to Comtech’s Board of Directors at the Company’s upcoming 2021 Annual Meeting of Stockholders:

ISS correctly recognizes the transformative actions Comtech’s Board and management have taken to strengthen corporate governance and strategically reposition the company to capitalize on secular growth opportunities. These actions include executing a multi-year Board refreshment process, completing a leadership succession plan, and developing an industry-leading portfolio of products and services in rapidly growing core markets. ISS also noted the strength of our incoming CEO’s knowledge of the industry and that the Board’s leadership change has put the company on a better trajectory poised to take advantage of sector tailwinds.

Where ISS misses the mark, however, is in its failure to attribute Comtech’s recent success to these critical actions, which Comtech’s current Board and management team have been implementing for the past five years. Over this period, Comtech has created clear value for shareholders, delivering five-year total shareholder returns of 126.7% – exceeding the S&P 600 (99.7%), the NASDAQ Telecommunications Index (87.5%), and the appropriate peer set (36.7%).¹ By contrast, Outerbridge’s only proven track record is trading its common stock and many short-term stock options in Comtech and Barnes & Noble Education at prices favorable to itself while creating volatility for long-term shareholders.

We believe ISS gravely underestimates the damage that would be done if Sidney Fuchs were to join the Comtech Board. ISS mistakenly dismisses Fuchs’ material conflict of interest as Chairman of Eutelsat America Corp. when several of Comtech’s largest customers have already voiced concerns about his potential appointment. While ISS suggests that Mr. Fuchs could recuse himself, we do not see how that could work when customer considerations are foundational to every strategic decision the Board makes, including investments in organic growth opportunities and M&A. In our view, to the extent Mr. Fuchs would have to recuse himself or would be conflicted from participating in committee or board meetings, it would likely be equivalent to his not serving on the Board at all.

A more comprehensive analysis of the candidates’ qualifications demonstrates that Mr. Fuchs lacks the skills and expertise to add incremental value for shareholders – and would indeed be value-destructive. We note that ISS chose not to support Outerbridge candidate Wendi Carpenter in part due to her lack of experience that is relevant to Comtech’s business.

Further, ISS fails to appreciate the importance of the $100 million strategic growth investment that Comtech secured from current shareholder White Hat Capital Partners, LP and Magnetar Capital LLC to accelerating our value creation strategy. ISS is incorrect about our borrowing capacity under our existing credit facility. Based on Comtech’s existing $200 million of debt, its $30 million of planned capital expenditures, its ongoing annual dividend program, its publicly announced fiscal 2022 guidance, and existing covenants, Comtech would not be able to make a request for a single dollar of incremental borrowing under the $250 million accordion feature. In light of this, we approached our key lending partners and they advised us to raise capital before seeking to obtain necessary additional borrowings.

This investment more than doubles our accessible capital to invest in a generational technology renewal cycle across core markets. It also offers us important financial flexibility and liquidity as we continue to navigate the impacts of COVID-19 and supply chain issues.

We urge shareholders to consider that electing any of Outerbridge’s nominees will introduce significant risk to the Company’s strategic direction. Outerbridge has nominated these candidates with no clear plan to enhance shareholder value but has made no secret of its self-serving objectives and has been willing to use blatant misinformation, seemingly for the purpose of bolstering its reputation as an activist and aiding its fundraising efforts. The underlying impact of voting for any of Outerbridge’s red-flag candidates is clear: a hedge fund with no experience in Comtech’s industry or understanding of our business will advocate for a near-term sale or announcement of a strategic alternatives process, tactics that would benefit Outerbridge’s trading strategy by allowing it to turn a quick profit on its near-term options holdings.

By comparison, both of Comtech’s nominees on the BLUE proxy card, Larry Waldman and Judy Chambers, have the experience, skills, and qualifications necessary to continue overseeing execution of the Company’s long-term strategic plan and creating shareholder value.

• Larry Waldman has been a critical independent voice in driving the Company’s successful transformation over the last six years. He has helped oversee the Company’s acquisition strategy (including building the NextGen 911 portfolio that Outerbridge asserts is the “crown jewel” of the company), Board refreshment, and leadership succession plan, among other value-enhancing initiatives undertaken over a number of years. Under his stewardship, the Company has generated total shareholder returns of over 120% over the last five years², and the Company is on significantly stronger footing with significant recurring revenues and a robust new business pipeline.

• Judy Chambers has already overseen significant corporate governance enhancements since joining the Board in August 2021 – including a plan for declassification, the completion of our leadership succession, and the appointment of two incoming directors with extensive industry experience. Her financial and M&A expertise, track record navigating infrastructure projects with public authorities, and demonstrated commitment to ESG will play an indispensable role in our value creation strategy moving forward.

Now is not the time to disrupt Comtech’s strong forward momentum and thoughtful value creation plan by supporting Outerbridge’s unqualified nominees and depriving our Board of critical skills and experience to achieve long-term growth.

Comtech reminds shareholders that their votes are extremely important, no matter how many or how few shares they own. Comtech strongly recommends that shareholders elect Comtech’s highly qualified director nominees, Judy Chambers and Larry Waldman, by voting the BLUE proxy card today.

关于康泰克

康泰科电信公司是全球领先的下一代911应急系统和安全无线通信技术供应商，为世界各地的商业和政府客户提供服务。总部设在纽约的梅尔维尔，本着为客户取得成功的热情，Comtech设计、生产和销售先进和安全的无线解决方案。欲了解更多信息，请访问：www.comtechtel.com。

前瞻性声明

本新闻稿中的某些信息包含具有前瞻性的陈述，涉及某些重大风险和不确定性，包括关于我们的业务轨迹、未来收入和销售、收购战略、管理和治理变革以及增长。实际结果可能与这些前瞻性信息有实质性的差异。可能影响这些前瞻性声明的风险和不确定因素包括最近的收购所带来的预期协同效应和利益可能不会完全实现，或者不会在预期时间内实现；被收购的业务不能成功地与公司整合的风险；最近的收购可能造成混乱，使维持业务和运营关系或保留关键人员更加困难；本公司在政府解决方案部门实施战术性转变的风险，即从竞标大型商品服务合同转向寻求利润率更高的利基产品合同；收到新订单或现有订单的性质和时间以及本公司在这些订单上的表现可能导致净销售额和经营业绩的大幅波动；政府合同的时间和供资；长期合同毛利的调整；与国际销售有关的风险；技术的快速变化；不断发展的行业标准；新产品的公布和改进；客户需求和/或采购策略的变化；当前经济和政治条件的变化；全球市场石油价格的变化；外币汇率的变化；与本公司的法律诉讼、客户赔偿要求和其他类似事项有关的风险；与本公司在其信用贷款下的义务有关的风险；与本公司的大型合同有关的风险；与COVID-19大流行病和相关供应链中断有关的风险；以及本文件和本公司提交给证券交易委员会的其他文件中描述的其他因素。我们不承担任何义务，也不打算更新这些前瞻性声明，或使这些声明符合实际结果或我们预期的变化。

其他信息和查找地点

Comtech has filed with the Securities and Exchange Commission (“SEC”) and mailed to the Company’s stockholders a definitive proxy statement, an accompanying BLUE proxy card and other relevant documents in connection with the Company’s Fiscal 2021 Annual Meeting of Stockholders (the “2021 Annual Meeting”). THE COMPANY’S STOCKHOLDERS ARE URGED TO READ THE PROXY STATEMENT, THE ACCOMPANYING BLUE PROXY CARD AND ANY OTHER DOCUMENTS TO BE FILED WITH THE SEC IN CONNECTION WITH THE COMPANY’S 2021 ANNUAL MEETING OR INCORPORATED BY REFERENCE IN THE PROXY STATEMENT BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE COMPANY’S 2021 ANNUAL MEETING AND THE PARTIES RELATED THERETO. The Company’s stockholders may obtain a free copy of documents filed with the SEC at the SEC’s website at https://www.sec.gov or the Company’s website at www.ComtechCreates.com.

征求意见的参与者

本公司、其董事和某些执行官是，以及本公司的某些其他管理层成员和员工可能被视为就2021年年会审议的事项向股东征集代表的 "参与者"。根据美国证券交易委员会的规则，被视为或可能被视为与本公司2021年年度会议有关的本公司股东征集活动的参与者的人，通过持有证券或其他方式在本公司的直接和间接利益的信息，载于本公司提交的与本公司2021年年度会议有关的最终代理声明和提交给美国证券交易委员会的其他相关文件。你也可以在本公司截至2021年7月31日的财政年度的10-K表年报、本公司和这些人向美国证券交易委员会提交的其他文件中找到有关本公司执行官员和董事的信息。

PCMTL

¹资料来源：截至2021年10月29日，彭博社的市场数据。所选同行是拥有商业和政府客户的全球通信解决方案和服务提供商；仅限于市值低于100亿美元的实体。选定的同行包括Elbit, Gilat, KVH Industries, ST Engineering, 和Viasat。股东总回报假设股息按无风险利率再投资。

² Source: Bloomberg market data as of October 29, 2021.

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