PROPERTY AND EQUIPMENT

3 Months Ended

Mar. 31, 2013

3. PROPERTY AND EQUIPMENT

Property and equipment consists of the following (in thousands):

	March 31,			December 31,
	2013			2012
Globalstar System:
Space component	$	1,029,932		$	934,900
Ground component		48,889			49,089
Construction in progress:
Space component		208,979			299,209
Ground component		105,386			84,423
Prepaid long-lead items and other		17,646			17,920
Total Globalstar System		1,410,832			1,385,541
Internally developed and purchased software		14,747			14,414
Equipment		12,714			12,800
Land and buildings		4,004			4,003
Leasehold improvements		1,504			1,512
		1,443,801			1,418,270
Accumulated depreciation and amortization		(222,658	)		(203,114	)
	$	1,221,143		$	1,215,156

Amounts in the table above consist primarily of costs incurred related to the construction of the Company's second-generation constellation, related launch services and ground upgrades. Amounts included in the Company's construction in progress - space component balance as of March 31, 2013 consists primarily of costs related to the remaining second-generation satellites launched in February 2013. The estimated cost per satellite will be transferred from construction in progress as each satellite is placed into commercial service. See Note 8 for further discussion of the Company's contractual obligations.

Capitalized Interest and Depreciation Expense

The following tables summarize capitalized interest for the periods indicated below (in thousands):

	As of
	March 31,		December 31,
	2013		2012
Total Interest Capitalized	$	223,615	$	216,477

	Three Months Ended
	March 31, 2013		March 31, 2012
Current Period Interest Capitalized	$	7,138	$	12,911

The following table summarizes depreciation expense for the periods indicated below (in thousands):

	Three Months Ended
	March 31, 2013		March 31, 2012
Depreciation Expense	$	19,873	$	14,466

- Definition

The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures.

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