What changed in this filing

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Item 1A. Risk Factors

2024-02-29 compared with 2023-03-01 · 108 added, 117 removed, 357 unchanged (39% of the section changed)

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Revenue under the Service Agreements constitutes a substantial portion of our current revenues, and there is no assurance that we will receive the revenue expected under the Service Agreements.

The Service Agreements contributed approximately 24% of our revenue for the year ended December 31, 2022.

Consideration received under the Service Agreements constituted approximately 49% of our revenue for the year ended December 31, 2023.

The Service Agreements impose a number of substantial obligations on us, provide for certain of our fees to be payable only upon satisfaction of the conditions therein and are terminable by each party.

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• changes in technology which may make all or a portion of our satellite fleet obsolete.

It is possible that the actual orbital lives of one or more of our existing satellites may be shorter than originally anticipated.

Further, it is possible that the total available payload capacity of a satellite may need to be reduced prior to the satellite reaching its end-of-orbital life.

We periodically review the expected orbital life of each of our satellites using current engineering data.

It is also possible that the total available payload capacity of a satellite may need to be reduced prior to the satellite reaching its end-of-orbital life.

A reduction in the orbital life of any of our satellites could result in a reduction of revenue, the recognition of an impairment loss and an acceleration of capital expenditures.

The potential impact on our revenue from a reduction in the orbital life of one or more satellites may vary depending on the satellite's orbital location as well as the type of device and service a customer is using.

Our satellites may collide with space debris which could adversely affect the performance of our constellation.

Our satellites are exposed to a wide and unique range of risks, including collisions with space debris, natural disasters and other extreme space weather events, all of which could adversely affect the performance of our constellation.

Our ability to maneuver our satellites to avoid potential collisions with space debris is limited by, among other factors, uncertainties and inaccuracies in the projected orbit location of, and predicted conjunctions with, debris objects tracked and cataloged by the U.S.

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Any such collision could potentially expose us to significant losses.

A natural disaster could diminish our ability to provide communications service.

Natural disasters could damage or destroy our ground stations and disrupt service to our customers.

In addition, the collateral effects of disasters such as flooding may impair, damage or destroy our ground equipment.

If a natural disaster were to impair, damage or destroy any of our ground facilities, we may be rendered unable to provide service to our customers in the affected area, either temporarily or indefinitely.

Even if our gateways are not affected by natural disasters, our service could be disrupted if a natural disaster damages the public switch telephone network, terrestrial wireless networks or our ability to connect to the public switch telephone network or terrestrial wireless networks.

Natural disasters, including collateral effects, could damage or destroy our ground stations and disrupt service to our customers.

In addition, space weather, including coronal mass ejections and solar flares have the potential to impact the performance.

If we experience operational disruptions with respect to a natural disaster or space weather event, we may be unable to provide service to our customers in the affected area, either temporarily or indefinitely.

Additionally, there are inherent dangers and risk associated with our satellite operations, including the risk of increased radiation.

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We do not insure our satellites against in-orbit failures after an initial period of six months, whether the failures are caused by internal or external factors.

In-orbit failure may result from various causes, including component failure, solar array failures, telemetry transmitter failures, loss of power or fuel, inability to control positioning of the satellite, solar or other astronomical events, including solar radiation and flares, and collision with space debris or other satellites.

flares, and collision with space debris or other satellites.

These failures are commonly referred to as anomalies.

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Additionally, human operators may execute improper implementation commands that may negatively impact a satellite's performance.

If a satellite fails prior to the end of its estimated useful life, we record an impairment charge in our statement of operations to reduce the remaining net book value of that satellite to zero;

If a satellite fails prior to the end of its estimated useful life, we would record an impairment charge in our statement of operations to reduce the remaining net book value of that satellite to zero;

any such impairment charges could depress our net income (or increase our net loss) for the period in which the failure occurs.

The implementation of our business plan depends on increased demand for wireless communications services via satellite (including IoT applications) and via terrestrial mobile broadband networks, both for our existing services and products and for new services and products.

The implementation of our business plan depends on increased demand for wireless communications services via satellite and terrestrial mobile broadband networks, both for existing and new services and products.

We plan to introduce new products and services that work over our network as well as terrestrial mobile broadband services.

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• our ability to raise additional capital on acceptable terms when required.

Rapid and significant technological changes in the satellite communications industry may impair our competitive position and require us to make significant capital expenditures, which may require additional capital that has not been arranged.

Our business will be negatively impacted if we fail to adequately anticipate our satellite capacity needs or are unable to obtain satellite capacity.

In February 2022, we entered into a satellite procurement agreement with MDA pursuant to which we expect to acquire at least 17 satellites that will replenish our existing constellation and provide long-term continuity of our mobile satellite services.

We are acquiring the satellites to provide continuous satellite services and meet our obligations under the Service Agreements, as well as to provide services to our current and future customers.

We may not have sufficient satellite capacity available to

meet increases in demand, and we may not be able to quickly or easily adjust our capacity to such changes in demand.

In addition, satellites represent a significant capital expenditure.

Our business could be adversely affected if we are not able to anticipate or adapt to consumer demands for satellite capacity.

Rapid and significant technological changes in the satellite communications industry may impair our competitive position and require us to make significant capital expenditures.

The space and communications industries are subject to rapid advances and innovations in technology.

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New technologies may be protected by patents and therefore may not be available to us.

We expect to face competition from companies using new technologies and new satellite systems.

The hardware and software we utilize in operating our first-generation gateways were designed and manufactured over 20 years ago and portions have deteriorated.

This original equipment may become less reliable as it ages and will be more difficult and expensive to service.

It may be difficult or impossible to obtain all necessary replacement parts for the hardware before the new equipment and software is fully deployed.

Some of the hardware and software we use in operating our gateways are significantly customized and tailored to meet our requirements and specifications and could be difficult and expensive to service, upgrade or replace.

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Satellite-based Competitors

There are currently at least four other MSS operators providing services similar to ours on a global or regional basis:

Iridium, Thuraya, Inmarsat and ORBCOMM Inc.

Recently, the FCC partially approved SpaceX's application to launch a portion of its satellite constellation.

There are other MSS operators providing services similar to ours on a global or regional basis:

Iridium, Thuraya, Viasat (though its acquisition of Inmarsat) and ORBCOMM Inc.

The provision of satellite-based products and services is subject to downward price pressure when the capacity exceeds demand or as new competitors enter the marketplace with competitive pricing strategies.

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As a result, we may not grow our customer base and revenue.

Additionally, in connection with the Service Agreements, our direct to device service, also faces competition from other satellite service providers that are expected to provide similar satellite services to competitive smartphone devices.

Additionally, in connection with the Service Agreements, our direct to device service also faces competition from other satellite service providers that are expected to provide similar satellite services.

For instance, SpaceX has launched its Starlink constellation and has plans to enter the direct-to-cellular market through a series of partnerships.

Other satellite providers are in the process of establishing partnerships and network capabilities to offer additional service alternatives.

Terrestrial Competitors

In addition to our satellite-based competitors, terrestrial wireless voice and data service providers are continuing to expand into rural and remote areas, particularly in less developed countries.

They provide the same general types of services and products that we provide through our satellite-based system.

Many of these companies have greater resources, more name recognition and newer technologies than we do.

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DISH Network received FCC approval to offer terrestrial wireless services over the MSS spectrum that previously belonged to TerreStar and ICO Global.

Furthermore, Ligado Networks (formerly LightSquared) also received FCC approval to build out a wireless network utilizing its MSS spectrum.

Furthermore, Ligado Networks (formerly LightSquared) has received certain

approvals relating to the build out of its wireless network.

Any of these competitors could deploy terrestrial mobile broadband networks before we do, could combine with existing terrestrial networks that provide them with greater financial or operational flexibility than we have or could offer wireless services, including mobile broadband services, that customers prefer over ours.

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The government may also unlock new spectrum bands.

We could fail to achieve the strategic objectives of the XCOM transaction, and our new Chief Executive Officer may not succeed, which could negatively impact our business and results of operations.

In August 2023, we entered into an Intellectual Property License Agreement with XCOM pursuant to which we acquired a license to use certain intellectual property assets of XCOM.

In connection with the transaction, we appointed Dr.

Jacobs, founder of XCOM, as our Chief Executive Officer.

The XCOM transaction may not advance our business strategy in the way we intend, which could harm our growth or profitability.

In addition, we may not realize the expected benefits or synergies from the XCOM transaction or realize a satisfactory return on our investment in the XCOM assets or increase our revenue.

These risks may be exacerbated because we have a new Chief Executive Officer.

Our new Chief Executive Officer may not succeed at working with the current management team, growing revenue, or implementing a successful business plan.

All of the foregoing could negatively impact our results of operations and financial condition.

Uncertain global macro-economic and political conditions could materially adversely affect our results of operations and financial condition.

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In addition, deterioration of conditions in worldwide credit markets could limit our ability to obtain financing to fund our operations and capital expenditures.

The current invasion of Ukraine by Russia has escalated tensions among the United States, the North Atlantic Treaty Organization (“NATO”) and Russia.

The United States and other NATO member states, as well as non-member states, have announced new sanctions against Russia and certain Russian banks, enterprises and individuals.

These and any future additional sanctions and any resulting conflict between Russia, the United States and NATO countries could have an adverse impact on our current operations.

Further, such invasion, ongoing military conflict, resulting sanctions and related countermeasures by NATO states, the United States and other countries are likely to lead to market disruptions, including significant volatility in commodity prices, credit and capital markets, as well as supply chain interruptions for equipment, which could have an adverse impact on our operations and financial performance.

Volatility in the financial markets may impede our ability to access capital markets and may adversely affect our financial condition.

Our Service Agreements with Partner require us to raise additional financing, such as to refinance our 2019 Facility Agreement.

Turmoil in the capital markets, including the tightening of credit and increased interest rates, have impacted, and may continue to impact in the future, our ability to raise financing on terms and at a cost favorable to the Company.

We are, and may be again in the future, required to raise capital during a weak economy, and have little flexibility to wait for more favorable terms or economic conditions.

We are likely to face higher borrowing costs, less available capital, more stringent terms and tighter covenants.

Such unfavorable market conditions could have an adverse impact on our ability to fund our operations and capital expenditures in the future, including our obligations under the Service Agreements and the satellite procurement agreement with MDA.

Any adverse change in the terms of our financing, including increased costs, could have a negative impact on our financial condition.

The conflicts in Ukraine and Gaza, and any sanctions imposed as a result, could have an adverse impact on our current operations.

Further, such conflicts are likely to lead to market disruptions, including significant volatility in commodity prices, credit and capital markets, as well as supply chain interruptions for equipment, which could have an adverse impact on our operations and financial performance.

Lack of availability of components from the electronics industry, required in our retail products, gateways and satellites could delay or adversely impact our operations.

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Recent disruptions in the global supply chain have limited our ability to procure component parts timely and at reasonable prices.

During 2022, supply chain disruptions and production issues negatively impacted our ability to sell our most popular SPOT and Commercial IoT products.

We continue to fulfill customer orders, including the sell-through of safety stock, and maintain adequate margins on subscriber equipment sales as well as maintain our gateways;

however the continued impact of global component part shortages is unknown and may continue to adversely impact our business, financial condition and results of operations.

During 2022 and at times in 2023, supply chain disruptions and production issues negatively impacted our ability to sell our most popular SPOT and Commercial IoT products.

The future impact of global component part shortages is unknown and may adversely impact our business, financial condition and results of operations.

Our business is capital intensive.

We may not be able to raise adequate capital to finance our business strategies, or we may be able to do so only on terms that significantly restrict our ability to operate our business.

We may not be able to raise adequate capital on reasonable terms to finance our business strategies, or we may be able to do so only on terms that significantly restrict our ability to operate our business.

Implementation of our longer-term business strategy requires a substantial outlay of capital.

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In addition, if one of our satellites failed unexpectedly, there can be no assurance of insurance recovery for our losses or the timing thereof, and we may need to obtain additional financing to replace the satellite.

When we determine we need to obtain additional funds through external financing and are unable to do so on terms and conditions we determine favorable to us or at all, we may be prevented from fully implementing our business strategy.

If we do not develop, acquire and maintain proprietary information and intellectual property rights, it could limit the growth of our business and reduce our market share.

To the extent we are required to raise additional financing, turmoil in the capital markets, including the tightening of credit and increased interest rates, may impact our ability to raise financing on terms and at a cost favorable to the Company.

We may be required to raise capital during a weak economy, and have little flexibility to wait for more favorable terms or economic

We are likely to face higher borrowing costs, less available capital, more stringent terms and tighter covenants.

Such unfavorable market conditions could have an adverse impact on our ability to fund our operations and capital expenditures in the future.

Any adverse change in the terms of our financing, including increased costs, could have a negative impact on our financial condition.

If we do not develop, acquire, maintain and protect proprietary information and intellectual property rights, it could limit the growth of our business and reduce our market share.

Our business depends on technical knowledge, and we base our business plan in part on our ability to keep up with new technological developments and incorporate them in our products and services.

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Our proprietary information may be disclosed to others, or others may independently develop similar information, systems and know-how.

Our success depends, in part, on our ability to protect our proprietary intellectual property rights, including certain methodologies, practices, tools, technologies and technical expertise we utilize in designing, developing, implementing and maintaining our technologies.

The steps we take to protect our intellectual property may be inadequate, and we may choose not to pursue or maintain protection for our intellectual property.

We will not be able to protect our intellectual property if we are unable to enforce our rights or if we do not detect unauthorized use of our intellectual property.

Despite our precautions, it may be possible for unauthorized third parties to copy our technology and use information that we regard as proprietary to create technology that competes with ours.

Protection of our information, systems and know-how may result in litigation, the cost of which could be substantial.

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We face special risks by doing business in international markets and developing markets, including currency and expropriation risks, which could increase our costs or reduce our revenues in these areas.

Although our most economically important geographic markets currently are the United States and Canada, we have substantial markets for our mobile satellite services in, and our business plan includes, developing countries or regions that are underserved by existing telecommunications systems, such as rural Brazil, Central America, Argentina and Africa.

Developing countries are more likely than industrialized countries to experience market, currency and interest rate fluctuations and high inflation.

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• noncompliance with the Foreign Corrupt Practices Act ("FCPA"), UK Bribery Act, sanctions laws and export controls;

• violation by employees or suppliers in regards to our code of conduct and business ethics;

• exposure to varying legal standards in other jurisdictions, including intellectual property protection and other similar laws and regulations;

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Approximately 20% and 27% of our total revenue was to customers primarily located in Canada, Europe, Central America, and South America during 2023 and 2022, respectively.

Our results of operations for 2022 and 2021 included net losses of approximately $6.6 million and net losses of $6.3 million, respectively, on foreign currency transactions.

Our results of operations for 2023 and 2022 included net gains of approximately $4.9 million and net losses of $6.6 million, respectively, on foreign currency transactions.

We may be unable to offset unfavorable currency movements as they adversely affect our revenue and expenses.

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Our indebtedness may adversely affect our cash flow and our ability to operate our business, including our ability to incur additional indebtedness.

Our principal near-term liquidity requirements include primarily funding our operating costs, capital expenditures, including repayment of amounts being financed through MDA, and future amounts expected to be incurred, under the satellite procurement agreement;

repayment of the remaining principal balance due under the 2019 Facility Agreement;

and interest and dividends due on any debt or preferred equity instruments outstanding.

Our principal sources of liquidity during 2022 included cash on hand ($32.1 million), cash flows from operations and vendor financing.

Our principal sources of liquidity over the next twelve months are expected to include cash on hand, cash flows from operations, prepayments under the Service Agreements (discussed in Recent Developments below) and funds from a debt or equity financing that has not yet been arranged.

Our operating expenses for the twelve-month period ended December 31, 2022 were $369.5 million, which included nonrecurring, noncash impairment charges of $175.1 million as well as noncash depreciation, amortization and accretion of $93.9 million.

Another source of liquidity may include proceeds from the exercise of warrants under the Service Agreements.

We also expect sources of liquidity to include funds from other debt or equity financings that have not yet been arranged;

actively pursuing a new financing arrangement to refinance amounts due under the 2019 Facility Agreement.

On a longer-term basis, our liquidity requirements also include debt service obligations.

We cannot provide assurance that we will not experience a liquidity shortfall in the short or long-term.

As of December 31, 2022, the principal balance of our debt obligations was $203.0 million, consisting of $143.2 million under the 2019 Facility Agreement and $59.8 million under our vendor financing arrangement.

In February 2023, we executed a prepayment agreement under the Service Agreements, whereby Partner is obligated, subject to certain conditions, to fund an amount up to approximately $252.0 million (to be adjusted as required), which is required to be recouped by Globalstar beginning at the earlier of phase two service launch or the third quarter of 2025.

On a near-term and longer-term basis, principal liquidity requirements include primarily funding our operating costs, capital expenditures, and financing obligations, including scheduled recoupments under our Funding Agreements, interest on our 2023 13% Notes (as defined below), and dividends on our perpetual preferred stock.

Our principal sources of liquidity include cash on hand ($56.7 million at December 31, 2023), cash flows from operations and proceeds from the funding agreement under the Service Agreements.

Another source of liquidity may include proceeds from the exercise of warrants under the Service Agreements and the guaranty agreement with Thermo.

Our operating expenses for the year ended December 31, 2023 were $224.0 million, which included noncash items such as stock-based compensation of $22.5 million and depreciation, amortization and accretion of $88.2 million.

As of December 31, 2023, the principal balance of our debt obligations was $398.7 million, consisting of $117.3 million under the 2023 Funding Agreement, $75.5 million under the 2021 Funding Agreement and $206.0 million under the 2023 13% Notes.

Refer to Part II, Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resource s below for further discussion.

Our indebtedness could restrict us from making strategic acquisitions by limiting our ability to obtain additional financing for working capital, capital expenditures, product development, debt service requirements, acquisitions and general corporate purposes.

Our indebtedness could restrict us from paying dividends to our shareholders.

It could limit our flexibility in planning for, or reacting to, changes in our business or industry, placing us at a competitive disadvantage compared to competitors who are not as highly leveraged as us and who, therefore, may be able to take advantage of opportunities that our leverage prevents us from exploiting.

Our indebtedness could restrict us from paying dividends to our common shareholders.

It could limit our flexibility in planning for, or reacting to, changes in our business or industry, placing us at a competitive disadvantage compared to competitors who may be able to take advantage of opportunities that our leverage prevents us from exploiting.

Additionally, even though our current debt agreements place limits on our ability to incur additional debt, in the future we may incur additional debt which could further exacerbate these risks.

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the availability of such financing may be unavailable on terms and conditions we determine favorable to us or at all.

Restrictive covenants in our 2019 Facility Agreement and Service Agreements may limit our operating and financial flexibility and our inability to comply with these covenants could have significant implications.

Our 2019 Facility Agreement and prepayment agreement associated with the Service Agreements contain a number of significant restrictions and covenants.

Restrictive covenants in our financing arrangements may limit our operating and financial flexibility and our inability to comply with these covenants could have significant implications.

Our Funding Agreements and 2023 13% Notes contain a number of significant restrictions and covenants.

Long-Term Debt and Other Financing Arrangements in our Consolidated Financial Statements in Part II, Item 8 of this Report for further discussion of our debt covenants.

Complying with these restrictive covenants, including financial and non-financial covenants, as well as those that may be contained in any agreements governing future indebtedness, may impair our ability to finance our operations or capital needs or to take advantage of favorable business opportunities.

Our 2019 Facility Agreement includes a limitation on expenditures in connection with spectrum rights, which may prohibit us from making certain expenditures that we consider accretive to our business and would otherwise make.

Our financing arrangements include limitations on expenditures in connection with the incurrence of certain operating expenses and capital expenditures, which may prohibit us from making certain expenditures that we consider accretive to our business and would otherwise make.

Our ability to comply with these covenants will depend on our future performance, which may be affected by events beyond our control.

We have received waivers from our lenders in the past;

however, we may not be successful in obtaining waivers from the remaining lender in the future, which may result in noncompliance with restrictions and covenants.

Our failure to comply with these covenants would be an event of default.

An event of default under the 2019 Facility Agreement or the Service Agreements would permit the lender to accelerate the indebtedness under these agreements.

That acceleration would permit holders of our obligations under other agreements that contain cross-acceleration provisions to accelerate our obligations to them.

See Part II, Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources of this Report for further discussion.

Our networks and those of our third-party service providers and customers may be vulnerable to unauthorized or unlawful access.

An event of default under the financing arrangements would permit the lender to accelerate the indebtedness under these agreements.

Our networks and those of our third-party service providers and customers may be vulnerable to unauthorized or unlawful access, including cyber-attacks and other security breaches, that could have significant negative consequences.

Our use of personal information could give rise to costs and liabilities arising from developing data privacy laws.

Our network and those of our third-party service providers and our customers may be vulnerable to unauthorized access, attacks, malware, data breaches and other security problems.

Our business depends on our ability to limit and mitigate interruptions to or degradation of the security of our network.

Our network and those of our third-party service providers and our customers may be vulnerable to unauthorized access, computer viruses, cyber-attacks, malware, data breaches, distributed denial of services and other security breaches.

Persons who circumvent security measures could wrongfully obtain or use information from such networks or cause interruptions, delays or malfunctions in our operations.

A data breach or network disruption could harm our reputation, cause demand for our products and services to fall or compromise our ability to pursue our business plans.

An attack on, or security breach of our network could result in theft of trade secrets, intellectual property, or other company confidential information, the interruption, degradation, or cessation of services, an inability to meet our service requirements under the Service Agreements, and potentially compromise customer data stored on or transmitted over our network.

We cannot guarantee that our security measures will not be circumvented, thereby resulting in security events, network failures or interruptions that could impact our network security or availability and have a material adverse effect on our business, financial condition and operational results.

A number of significant, widespread security breaches have compromised companies and governmental agencies.

In some cases, these breaches originated from outside the United States.

We may be required to expend significant resources to protect against the threat of security breaches or to alleviate problems, including reputational harm and litigation, caused by any breaches.

We may be required to expend significant resources to protect against the threat of security breaches or to alleviate problems, including reputational harm and litigation, caused by any breaches, and we may experience a reduction in revenues, litigation and a diminution of goodwill, caused by a compromise of our cybersecurity.

In addition, our customer contracts may not adequately protect us against liability to third parties with whom our customers conduct business.

We cannot assure you that any measures we implement to protect against breaches will provide security, that we will be able to react in a timely manner, or that our remediation efforts following any attacks will be successful.

We collect and store data, including our customers' personal information.

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The interpretation of privacy and data protection laws and regulations regarding the collection, storage, transmission, use and disclosure of such information in some jurisdictions is unclear and ever evolving.

These laws may be interpreted and applied differently from country to country and in a manner that is not consistent with our current data protection practices.

These laws may be interpreted and applied differently from country to country and in a manner that presents a challenge to our current data protection practices.

Complying with these varying international

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The effect of an epidemic or pandemic, such as the COVID-19 pandemic, could have an adverse impact on our operations and the operations of our customers and may have a material adverse impact on our financial condition and results of operations.

An epidemic or pandemic could significantly disrupt our operations, including, but not limited to, our workforce, supply

chain, regulatory processes and market demand of our products.

An epidemic or pandemic could also significantly impact our

customers, including their demand for and ability to pay for our services and equipment.

The extent to which COVID-19 could

continue to impact our operations and financial condition will depend on future developments that are highly uncertain and cannot be predicted.

An epidemic or pandemic could significantly disrupt our operations, including, but not limited to, our workforce, supply chain, regulatory processes and market demand of our products.

An epidemic or pandemic could also significantly impact our customers, including their demand for and ability to pay for our services and equipment.

We operate in many tax jurisdictions, and changes in tax rates or adverse results of tax examinations could materially increase our costs.

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The process of determining our anticipated tax liabilities involves many calculations and estimates which are inherently complex.

Our tax obligations are subject to review and possible challenge by the taxing authorities of these jurisdictions, such as the ongoing income tax return audit being conducted by the Canada Revenue Agency of our Canadian subsidiary.

Our tax obligations are subject to review and possible challenge by the taxing authorities of these jurisdictions, such as the ongoing income tax return audits being conducted by the Canada Revenue Agency of our Canadian subsidiary.

If taxing authorities were to successfully challenge our current tax positions, or if we changed the manner in which we conduct certain activities, we could become subject to material, unanticipated tax liabilities.

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Many of our customers finance their activities through cash flows from operations, the incurrence of debt or the issuance of equity.

From time to time, credit is less available and available on more restrictive terms.

From time to time, credit is less available or available on more restrictive terms.

The combination of reduction of cash flow resulting from declines in commodity prices and the lack of availability of debt or equity financing may result in a significant reduction in our customers' liquidity and ability to make payments or perform on their obligations to us.

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Our MSS system is subject to significant regulation by the FCC in the United States, by the ARCEP and ANFR in France and in other foreign jurisdictions where we do business by similar authorities.

Additionally, the availability of globally

harmonized spectrum on which our MSS system depends is managed by the ITU.

The rules and regulations of these regulatory authorities are subject to change and may not continue to permit our operations as currently conducted or as we plan to conduct them.

Additionally, the availability of globally harmonized spectrum on which our MSS system depends is managed by the ITU and, to a certain extent, sovereign nations.

The rules and regulations of these regulatory authorities are subject to change and may not continue to permit our operations as

currently conducted or as we plan to conduct them.

Further, certain regulatory authorities may decide to allow additional uses within our ITU-allocation of spectrum that may be incompatible with our continued provision of MSS.

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In addition, we will need to comply with certain conditions in order to provide terrestrial broadband service under our MSS licenses, including obtaining FCC certifications for our equipment that will utilize this spectrum authority.

We are seeking similar approvals in various foreign jurisdictions, including applying for licenses and commencing due diligence efforts.

We are seeking similar approvals in various foreign jurisdictions.

We cannot guarantee that such efforts will be successful.

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Other future regulatory decisions could reduce our existing spectrum allocation or impose additional spectrum sharing agreements on us, which could adversely affect our services and operations.

The FCC may permit other MSS operators to operate in our frequency bands in the future.

The FCC may permit other MSS operators to operate in our frequency bands in the future despite its prior decisions.

To date, there are no other authorized CDMA-based MSS operators.

However, the FCC or other regulatory authorities may require us to share spectrum with other systems that are not currently licensed by the United States or any other jurisdiction.

From time to time, Globalstar has faced applications by other operators for access to its licensed spectrum.

From time to time, we have faced applications by other operators for access to its licensed spectrum.

We registered our second-generation constellation with the ITU through France rather than the United States.

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The FCC and other regulatory jurisdictions internationally are permitting expanded unlicensed use of the 5 GHz band including within our C-band forward link (earth station to satellite), which operates at 5091-5250 MHz which may have a significant adverse impact on our ability to provide mobile satellite services.

Additionally, the completion of the satellite navigation system in China could cause harmful interference to our existing and future services.

If the FCC, our French regulator, or any other regulator, revokes, modifies or fails to renew or amend our licenses, our ability to operate may be limited.

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customs procedures could result in an increase in the cost of our products.

Recently, the U.S.

For example, during 2018, the U.S.

imposed increased tariffs on certain imports from China, including several of our products, resulting in lower gross margin on impacted products.

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We cannot predict how any future tariffs or other trade restrictions will impact our business, but further trade restrictions on our products may result in further reductions to gross margin.

In response to the current tariffs and other relevant factors, we have commenced the process, together with our contract manufacturer, of moving our manufacturing from their facility located in China to their facility located in Vietnam.

This move may subject us to other risks in the manufacturing process.

Additionally, delays in goods clearing customs or the disruption of international transportation lines used by us could result in our inability to deliver goods to customers in a timely manner or the loss of sales altogether.

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Risks Related to Our Common Stock

Our common stock is traded on the NYSE American but could be delisted in the future, which may impair our ability to raise capital.

Our common stock is listed on the NYSE American under the symbol “GSAT.” Broker-dealers may be less willing or able to sell and/or make a market in our common stock if it were delisted, which may make it more difficult for shareholders to dispose of, or to obtain accurate quotations for the price of, our common stock.

Removal of our common stock from listing on the NYSE American may also make it more difficult for us to raise capital through the sale of our securities.

Restrictive covenants in our 2019 Facility Agreement and Service Agreements do not allow us to pay dividends on our common stock for the foreseeable future, which may affect the market for our shares.

Restrictive covenants in our financing arrangements restrict our ability to pay dividends on our common stock for the foreseeable future, which may affect the market for our shares.

We do not expect to pay cash dividends on our common stock.

Our 2019 Facility Agreement and Service Agreements currently prohibits the payment of cash dividends on our common stock.

Our Funding Agreements and 2023 13% Notes currently restrict our ability to pay cash dividends on our common stock.

During 2022, we issued shares of Series A Preferred Stock.

The terms of Series A Preferred Stock provides for the payment of cumulative cash dividends at a rate of 7% per annum, subject to certain terms and conditions.

The terms of Series A Preferred Stock provide for the payment of cumulative cash dividends at a rate of 7% per annum, subject to

certain terms and conditions.

If such dividends are not declared by our board of directors, the dividends will accrue and cumulative payment will be made on the next dividend payment date or upon liquidation.

The issuance of the Series A Preferred Stock required consent from the remaining lender of our 2019 Facility Agreement.

Any future dividend payments are within the discretion of our board of directors and will depend on, among other things, our results of operations, working capital requirements, capital expenditure requirements, financial condition, contractual restrictions, business opportunities, anticipated cash needs, provisions of applicable law and other factors that our board of directors may deem relevant.

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Our inability to pay dividends may limit the market for our shares.

The market price of our common stock is volatile, and there is a limited market for our shares.

There is a limited market for our common stock and our stock price may be volatile or may be subject to short selling.

The trading price of our common stock is subject to wide fluctuations.

Factors affecting the trading price of our common stock may include, but are not limited to:

• actual or anticipated variations in our operating results;

• failure in the performance of our current or future satellites;

• changes in financial estimates by research analysts, or any failure by us to meet or exceed any such estimates, or changes in the recommendations of any research analysts that elect to follow our common stock or the common stock of our competitors;

• actual or anticipated changes in economic, political or market conditions, such as recessions or international currency fluctuations;

• actual or anticipated changes in the regulatory environment affecting our industry;

• actual or anticipated changes in the value of terrestrial spectrum;

• actual or anticipated sales of common stock by our controlling stockholder or others;

• changes in the market valuations of our industry peers;

• announcement by us or our competitors of significant acquisitions, strategic partnerships, divestitures, joint ventures or other strategic initiatives.

There are a wide variety of factors, many of which are outside of our control, that could affect the trading price of our common stock.

The trading price of our common stock may also decline in reaction to events that affect other companies in our industry even if these events do not directly affect us.

Our stockholders may be unable to resell their shares of our common stock at or above the initial purchase price.

Additionally, because we are a controlled company, there is a limited market for our common stock, and we cannot assure our stockholders that a trading market will further develop or persist.

Because we are a controlled company, there is a limited market for our common stock, and we cannot assure our stockholders that a trading market will further develop or persist.

In periods of low trading volume, sales of significant amounts of shares of our common stock in the public market could lower the market price of our stock.

For instance, if we effect a reverse stock split, a higher market price of our common stock may help generate greater or broader investor interest;

however, we cannot assure you that a reverse stock split will result in a share price that will attract new investors.

Additionally, the liquidity of the shares of our common stock may be affected adversely by a reverse stock split given the reduced number of shares that will be outstanding following a reverse stock split, especially if the market price of our common stock does not increase as a result of the reverse stock split.

Additionally, selling short is a technique used by a stockholder to take advantage of an anticipated decline in the price of a security.

A significant number of short sales or a large volume of other sales within a relatively short period of time can create downward pressure on the market price of a security.

Further sales of common stock could cause even greater declines in the price of our common stock due to the number of additional shares available in the market, which could encourage short sales that could further undermine the value of our common stock.

Holders of our securities could, therefore, experience a decline in the value of their investment as a result of short sales of our common stock.

The future issuance of additional shares of our common stock could cause dilution of ownership interests and adversely affect our stock price.

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As of December 31, 2023, approximately 1.9 billion shares of common stock were issued and outstanding and 0.1 million shares of Series A Preferred Stock were issued and outstanding.

As of December 31, 2022, there were 0.4 billion shares of common stock available for future issuance, of which approximately 5.1 million shares were contingently issuable upon the exercise of stock options and the vesting of restricted stock awards and units and 49.1 million shares may be exercised by Partner from warrants issued under the Service Agreements to purchase up to 2.64% of our common stock (the "Warrants").

The number of Warrants issued to Partner is subject to certain adjustments, such as divided payments in shares of Globalstar common stock, stock splits, stock repurchases, merger, sale of assets or upon certain issuances of Globalstar common stock.

As of December 31, 2023, there were 0.4 billion shares of common and preferred stock available for future issuance, of which approximately 5.2 million shares were contingently issuable upon the exercise of stock options and the vesting of restricted stock awards and units, 44.5 million shares were contingently issuable upon the achievement and vesting of stock price targets for certain performance based restricted stock units, 5.0 million shares may be issued to Thermo if they exercise the warrants issued to them as consideration for their guarantee under the 2023 Funding Agreement and 49.1 million shares may be issued if the warrants issued in connection with the Service Agreements are exercised.

5.0 million warrants may vest if and when Thermo advances aggregate funds of $25.0 million or more to us or a permitted third party pursuant to the terms of Thermo's guarantee.

In the event Thermo is required to advance funds pursuant to its guarantee with us, we will also be required to issue it shares in respect of such advance.

We may issue additional shares of our common stock or other securities that are convertible into, or exercisable for, common stock for raising capital or other business purposes.

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Any preferred stock that is issued may rank ahead of our common stock in terms of dividends, priorities and liquidation premiums and have preferential voting rights to those held by the holders of our common stock.

If persons engage in short sales of our common stock, the price of our common stock may decline.

Selling short is a technique used by a stockholder to take advantage of an anticipated decline in the price of a security.

A significant number of short sales or a large volume of other sales within a relatively short period of time can create downward pressure on the market price of a security.

Holders of our securities could, therefore, experience a decline in the value of their investment as a result of short sales of our common stock.

Provisions in our charter documents, debt agreements and Delaware corporate law may discourage takeovers, which could affect the rights of holders of our common stock.

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• the requirement, at such time when Thermo does not own a majority of our outstanding capital stock entitled to vote in the election of directors, that our stockholders must obtain a super-majority vote to amend or repeal our amended and restated certificate of incorporation or bylaws;

• change of control provisions in our 2019 Facility Agreement, which provide that a change of control will constitute an event of default and, unless waived by the lenders, will result in the acceleration of the maturity of all indebtedness under that agreement;

• change of control provisions under our financing arrangements, which provide that a change of control will constitute a default and exercise remedies thereunder;

• change of control provisions in our 2006 Equity Incentive Plan, which provide that a change of control may accelerate the vesting of all outstanding stock options, stock appreciation rights and restricted stock.

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As of December 31, 2023, Thermo owned approximately 58% of our outstanding common stock.

Thermo's ownership of our outstanding common stock excludes the issuance of stock for warrants that have vested or may vest in connection with the Service Agreements as well as its ownership of perpetual preferred stock.

We have depended substantially on Thermo to provide capital to finance our business.

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These matters include the election of certain members of our board of directors and numerous other matters, including changes of control and other significant corporate transactions, so long as these transactions are not between Thermo and Globalstar and until such time as Thermo shall no longer be the beneficial owner of 45% or more of our outstanding common stock.

In addition, Thermo has guaranteed certain of our delegations related to the Service Agreements and has received warrants to purchase our common stock as consideration for providing such guarantee.

Thermo is controlled by James Monroe III, our Executive Chairman.

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The interests of Thermo may conflict with the interests of our other stockholders.

Thermo may take actions it believes will benefit its equity investment in us or loans to us even though such actions might not be in your best interests as a holder of our common stock.

Unresolved Staff Comments

Not Applicable

Thermo may take actions it believes will benefit its equity investment in us or in connection with its guarantees of our obligations even though such actions might not be in your best interests as a holder of our common stock.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors