10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One) 

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2016

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                  to                

Commission file number 001-33117 

GLOBALSTAR, INC.

(Exact Name of Registrant as Specified in Its Charter) 

Delaware	41-2116508
(State or Other Jurisdiction of	(I.R.S. Employer Identification No.)
Incorporation or Organization)

300 Holiday Square Blvd.

Covington, Louisiana 70433

(Address of principal executive offices and zip code)

Registrant's Telephone Number, Including Area Code: (985) 335-1500

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  x  No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes  x  No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. 

Large accelerated filer x	Accelerated filer ¨
Non-accelerated filer ¨	Smaller reporting company  ¨
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨  No x

As of July 28, 2016, 946,270,691 shares of voting common stock and 134,008,656 shares of nonvoting common stock were outstanding. Unless the context otherwise requires, references to common stock in this Report mean the Registrant’s voting common stock. 

FORM 10-Q

GLOBALSTAR, INC.

TABLE OF CONTENTS

		Page
PART I -  FINANCIAL INFORMATION
Item 1.	Financial Statements.	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	30
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	40
Item 4.	Controls and Procedures.	41
PART II -  OTHER INFORMATION
Item 1.	Legal Proceedings.	41
Item 1A.	Risk Factors.	41
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	42
Item 3.	Defaults Upon Senior Securities.	42
Item 4.	Mine Safety Disclosures.	42
Item 5.	Other Information.	42
Item 6.	Exhibits.	42
Signatures		43

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

GLOBALSTAR, INC.  

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(In thousands, except per share data)

(Unaudited)

	Three Months Ended						Six Months Ended
	June 30, 2016			June 30, 2015			June 30, 2016			June 30, 2015
Revenue:
Service revenues	$	20,970		$	18,616		$	39,719		$	35,723
Subscriber equipment sales	4,116			4,407			7,203			8,322
Total revenue	25,086			23,023			46,922			44,045
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	7,937			8,027			15,528			15,461
Cost of subscriber equipment sales	2,886			2,983			5,064			6,114
Marketing, general and administrative	11,450			10,159			20,060			18,755
Depreciation, amortization, and accretion	19,224			19,271			38,379			38,317
Total operating expenses	41,497			40,440			79,031			78,647
Loss from operations	(16,411		)	(17,417		)	(32,109		)	(34,602		)
Other income (expense):
Loss on extinguishment of debt	—			(2,189		)	—			(2,254		)
Loss on equity issuance	(2,075		)	(2,912		)	(1,923		)	(2,912		)
Interest income and expense, net of amounts capitalized	(9,049		)	(9,244		)	(18,154		)	(17,761		)
Derivative gain	40,499			237,087			39,155			129,222
Other	685			(452		)	(76		)	3,681
Total other income (expense)	30,060			222,290			19,002			109,976
Income (loss) before income taxes	13,649			204,873			(13,107		)	75,374
Income tax expense (benefit)	(450		)	106			(259		)	334
Net income (loss)	$	14,099		$	204,767		$	(12,848	)	$	75,040
Other comprehensive income (loss):
Foreign currency translation adjustments	(925		)	447			(1,576		)	(843		)
Total comprehensive income (loss)	$	13,174		$	205,214		$	(14,424	)	$	74,197
Net income (loss) per common share:
Basic	$	0.01		$	0.20		$	(0.01	)	$	0.07
Diluted	0.01			0.17			(0.01		)	0.07
Weighted-average shares outstanding:
Basic	1,049,381			1,009,917			1,045,205			1,005,406
Diluted	1,249,672			1,205,450			1,045,205			1,199,182

See accompanying notes to unaudited interim condensed consolidated financial statements. 

1

GLOBALSTAR, INC.  

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value and share data)  

(Unaudited)

	June 30, 2016			December 31, 2015
ASSETS
Current assets:
Cash and cash equivalents	$	11,269		$	7,476
Accounts receivable, net of allowance of $4,330 and $5,270, respectively	16,164			14,536
Inventory	9,698			12,023
Prepaid expenses and other current assets	5,030			4,456
Total current assets	42,161			38,491
Property and equipment, net	1,059,019			1,077,560
Restricted cash	37,918			37,918
Prepaid second-generation ground costs	4,165			8,929
Intangible and other assets, net of accumulated amortization of $6,873 and $6,315, respectively	13,497			12,117
Total assets	$	1,156,760		$	1,175,015
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	38,112		$	32,835
Accounts payable	6,039			8,118
Accrued contract termination charge	19,468			19,121
Accrued expenses	26,955			22,439
Payables to affiliates	240			616
Deferred revenue	25,225			23,902
Total current liabilities	116,039			107,031
Long-term debt, less current portion	540,350			548,286
Employee benefit obligations	4,894			4,810
Derivative liabilities	200,482			239,642
Deferred revenue	6,125			6,413
Debt restructuring fees	20,795			20,795
Other non-current liabilities	11,931			10,907
Total non-current liabilities	784,577			830,853
Commitments and contingent liabilities (Notes 7 and 8)
Stockholders’ equity:
Preferred Stock of $0.0001 par value; 100,000,000 shares authorized and none issued and outstanding at June 30, 2016 and December 31, 2015, respectively	—			—
Series A Preferred Convertible Stock of $0.0001 par value; one share authorized and none issued and outstanding at June 30, 2016 and December 31, 2015, respectively	—			—
Voting Common Stock of $0.0001 par value; 1,200,000,000 shares authorized; 946,245,007 and 904,448,226 shares issued and outstanding at June 30, 2016 and December 31, 2015, respectively	95			90
Nonvoting Common Stock of $0.0001 par value; 400,000,000 shares authorized; 134,008,656 shares issued and outstanding at June 30, 2016 and December 31, 2015	13			13
Additional paid-in capital	1,624,875			1,591,443
Accumulated other comprehensive loss	(6,409		)	(4,833		)
Retained deficit	(1,362,430		)	(1,349,582		)
Total stockholders’ equity	256,144			237,131
Total liabilities and stockholders’ equity	$	1,156,760		$	1,175,015

See accompanying notes to unaudited interim condensed consolidated financial statements.

2

GLOBALSTAR, INC. 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Six Months Ended
	June 30, 2016			June 30, 2015
Cash flows provided by (used in) operating activities:
Net income (loss)	$	(12,848	)	$	75,040
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation, amortization and accretion	38,379			38,317
Change in fair value of derivative assets and liabilities	(39,155		)	(129,222		)
Stock-based compensation expense	1,848			1,472
Amortization of deferred financing costs	4,672			4,667
Provision for bad debts	396			1,900
Noncash interest and accretion expense	5,487			5,712
Loss on extinguishment of debt	—			2,254
Loss on equity issuance	1,923			2,912
Noncash expense related to legal settlement	1,094			—
Unrealized foreign currency gain	(77		)	(3,442		)
Other, net	262			618
Changes in operating assets and liabilities:
Accounts receivable	(2,144		)	(3,652		)
Inventory	2,924			2,562
Prepaid expenses and other current assets	(868		)	(788		)
Other assets	104			(493		)
Accounts payable and accrued expenses	(1,474		)	(63		)
Payables to affiliates	(377		)	(25		)
Other non-current liabilities	50			(429		)
Deferred revenue	805			1,398
Net cash provided by (used in) operating activities	1,001			(1,262		)
Cash flows used in investing activities:
Second-generation network costs (including interest)	(5,307		)	(10,344		)
Property and equipment additions	(6,345		)	(2,325		)
Purchase of intangible assets	(806		)	(1,343		)
Net cash used in investing activities	(12,458		)	(14,012		)
Cash flows provided by (used in) financing activities:
Principal payments of the Facility Agreement	(16,418		)	(3,225		)
Proceeds from issuance of stock to Terrapin	28,500			24,000
Proceeds from issuance of common stock and exercise of options and warrants	3,016			419
Net cash provided by financing activities	15,098			21,194
Effect of exchange rate changes on cash	152			(170		)
Net increase in cash and cash equivalents	3,793			5,750
Cash and cash equivalents, beginning of period	7,476			7,121
Cash and cash equivalents, end of period	$	11,269		$	12,871
Supplemental disclosure of cash flow information:
Cash paid for:
Interest	$	10,922		$	9,746
Income taxes	127			5
	Six Months Ended
	June 30, 2016			June 30, 2015
Supplemental disclosure of non-cash financing and investing activities:
Increase in capitalized accrued interest for second-generation satellites and ground costs	1,500			995
Increase in accrued second-generation network costs	191			—
Capitalization of the accretion of debt discount and amortization of prepaid financing costs	2,099			1,580
Payments made in convertible notes and common stock	—			735
Principal amount of debt converted into common stock	—			6,491
Reduction of debt discount and issuance costs due to note conversions	—			2,085
Fair value of common stock issued upon conversion of debt	—			26,669
Reduction in derivative liability due to conversion of debt	—			20,008
Fair value of common stock issued to vendor for payment of invoices	—			16,684

See accompanying notes to unaudited interim condensed consolidated financial statements.

3

GLOBALSTAR, INC.  

NOTES TO UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

Globalstar, Inc. (“Globalstar” or the “Company”) provides Mobile Satellite Services (“MSS”) including voice and data communications services through its global satellite network. Thermo Capital Partners LLC, through its affiliates (collectively, “Thermo”), is the principal owner and largest stockholder of Globalstar. The Company’s Chairman and Chief Executive Officer controls Thermo. Two other members of the Company's Board of Directors are also directors, officers or minority equity owners of various Thermo entities.

The Company has prepared the accompanying unaudited interim condensed consolidated financial statements in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information. Certain information and footnote disclosures normally in financial statements have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"); however, management believes the disclosures made are adequate to make the information presented not misleading. These financial statements and notes should be read in conjunction with the consolidated financial statements and notes thereto included in the Globalstar Annual Report on Form 10-K for the year ended December 31, 2015, as filed with the SEC on February 26, 2016 (the "2015 Annual Report"), and Management's Discussion and Analysis of Financial Condition and Results of Operations herein. 

The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from estimates. The Company evaluates estimates on an ongoing basis. Significant estimates include the value of derivative instruments, the allowance for doubtful accounts, the net realizable value of inventory, the useful life and value of property and equipment, the value of stock-based compensation and income taxes. The Company has made certain reclassifications to prior period condensed consolidated financial statements to conform to current period presentation.

These unaudited interim condensed consolidated financial statements include the accounts of Globalstar and all its subsidiaries. All significant intercompany transactions and balances have been eliminated in the consolidation. In the opinion of management, the information included herein includes all adjustments, consisting of normal recurring adjustments, that are necessary for a fair presentation of the Company’s condensed consolidated statements of operations, condensed consolidated balance sheets, and condensed consolidated statements of cash flows for the periods presented. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results that may be expected for the full year or any future period.

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers. ASU No. 2014-09 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. This ASU requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In August 2015, the FASB decided to delay the effective date of ASU No. 2014-09. With the one-year deferral, ASU No. 2014-09 is now effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Additionally, early adoption is now permitted. However, entities reporting under U.S. GAAP are not permitted to adopt the standard earlier than the original effective date of December 15, 2016. The standard permits the use of either the retrospective or cumulative effect transition method. In March 2016, the FASB issued ASU No. 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net), which does not change the core principle of the guidance in ASU No. 2014-09 but clarifies the implementation guidance on principal versus agent considerations. The effective date and transition requirements for ASU No. 2016-08 are the same as those of ASU No. 2014-09. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing, which amends the guidance on accounting for licenses of intellectual property and identifying performance obligations in its new revenue standard. In May 2016, the FASB issued ASU No. 2016-12 Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients, whichis intended to reduce the cost and complexity of applying the new revenue standard and result in more consistent application. The Company is currently evaluating the impact that these standards will have on its financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of these standards on its ongoing reporting.

4

In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory. ASU No. 2015-11 requires that inventory within the scope of the guidance be measured at the lower of cost and net realizable value. Inventory measured using last-in, first-out (LIFO) and retail inventory method (RIM) are excluded from this new guidance. This ASU replaces the concept of market with the single measurement of net realizable value and is intended to create efficiencies for preparers and more closely align U.S. GAAP with IFRS. This ASU is effective for public business entities in fiscal years, and interim periods within those years, beginning after December 15, 2016. Prospective application is required and early adoption is permitted as of the beginning of an interim or annual reporting period. The Company is currently evaluating the impact this standard will have on its financial statements and related disclosures, but does not expect this ASU to have a material effect on its consolidated financial statements and related disclosures.

In November 2015, the FASB issued ASU. No. 2015-17, Balance Sheet Classification of Deferred Taxes. ASU No. 2015-17 simplifies the presentation of deferred taxes on the balance sheet by requiring classification of all deferred tax items as noncurrent including valuation allowances by jurisdiction. The ASU is effective for public entities for annual and interim periods beginning after December 15, 2016. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company is currently evaluating the impact this standard will have on its financial statements and related disclosures, but does not expect the effect to be material.

In March 2016, the FASB issued ASU No. 2016-02, Leases. The main difference between the provisions of ASU No. 2016-02 and previous U.S. GAAP is the recognition of right-of-use assets and lease liabilities by lessees for those leases classified as operating leases under previous U.S. GAAP. ASU No. 2016-02 retains a distinction between finance leases and operating leases, and the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from previous U.S. GAAP. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize right-of-use assets and lease liabilities. The accounting applied by a lessor is largely unchanged from that applied under previous U.S. GAAP. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. This ASU is effective for public business entities in fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company has not yet determined the effect of the standard on its ongoing reporting.

In March 2016, the FASB issued ASU No. 2016-04, Liabilities-Extinguishment of Liabilities: Recognition of Breakage for Certain Prepaid Stored-Value Products. ASU No. 2016-04 contains specific guidance for the derecognition of prepaid stored-value product liabilities within the scope of this ASU. This ASU is effective for public entities for annual and interim periods beginning after December 15, 2017. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company does not expect this ASU to have a material effect on its consolidated financial statements and related disclosures.

In March 2016, the FASB issued ASU. No. 2016-06, Derivatives and Hedging: Contingent Put and Call Options in Debt Instruments. ASU No. 2016-06 clarifies the requirements for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. This ASU is effective for public entities for annual and interim periods beginning after December 15, 2016. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company has not yet determined the effect of this standard on its ongoing reporting.

In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation. ASU No. 2016-09 simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. This ASU is effective for public business entities for annual and interim periods beginning after December 15, 2016. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company has not yet determined the effect of this standard on its ongoing reporting.

In June 2016, the FASB issued ASU No. 2016-13, Credit Losses, Measurement of Credit Losses on Financial Instruments. ASU No. 2016-13 significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The standard will replace today’s incurred loss approach with an expected loss model for instruments measured at amortized cost. Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. This ASU is effective for public entities for annual and interim periods beginning after December 15, 2019. Early adoption is permitted for all entities for annual periods beginning after December 15, 2018, and interim periods therein. The Company has not yet determined the effect of this standard on its ongoing reporting.

5

2. PROPERTY AND EQUIPMENT

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

	June 30, 2016			December 31, 2015
Globalstar System:
Space component
First and second-generation satellites in service	$	1,211,226		$	1,211,768
Prepaid long-lead items	17,040			17,040
Second-generation satellite, on-ground spare	32,481			32,481
Ground component	48,184			46,870
Construction in progress:
Space component	81			81
Ground component	190,328			177,780
Next-generation software upgrades	8,435			3,440
Other	2,375			2,153
Total Globalstar System	1,510,150			1,491,613
Internally developed and purchased software	14,753			14,492
Equipment	11,996			10,802
Land and buildings	3,343			3,151
Leasehold improvements	1,731			1,671
Total property and equipment	1,541,973			1,521,729
Accumulated depreciation	(482,954		)	(444,169		)
Total property and equipment, net	$	1,059,019		$	1,077,560

Amounts in the above table consist primarily of costs incurred related to the construction of the Company’s second-generation constellation and ground upgrades. The ground component of construction in progress represents costs (including capitalized interest) associated with the Company's contracts with Hughes Network Systems, LLC ("Hughes") and Ericsson Inc. (“Ericsson”) to complete next-generation upgrades to the Company's ground infrastructure. The Company expects to begin depreciating this asset in the near future. See Note 7: Commitments for further discussion of these contracts.

Amounts included in the Company’s second-generation satellite, on-ground spare balance as of June 30, 2016 consist primarily of costs related to a spare second-generation satellite that has not been placed in orbit, but is capable of being included in a future launch. As of June 30, 2016, this satellite and the prepaid long-lead items ("LLI") have not been placed into service; therefore, the Company has not started to record depreciation expense for these items.

Pursuant to the Amended and Restated Contract for the construction of Globalstar Satellites for the Second Generation Constellation between the Company and Thales Alenia Space France ("Thales"), dated and executed in June 2009 (the "2009 Contract"), the Company paid €12 million in purchase price plus an additional €3.1 million in procurement costs for the LLI to be procured by Thales on the Company's behalf. The LLI were to be used in the construction of the Phase 3 satellites for the Company. As reflected on the Company's condensed consolidated balance sheets and in the above table, the Company believes that it owns the LLI and that title to them transferred upon payment. The Company has asked Thales to turn over the LLI. Despite historical statements to the contrary, Thales currently disputes the Company's ownership of the LLI and has asserted that the Company released its title to the LLI pursuant to that certain Release Agreement, dated as of June 24, 2012, which is described more fully in Note 8: Contingencies. Thales further asserts that the LLI belong to Thales and that Thales has no obligation to turn over possession of the LLI to the Company. The Company disputes Thales' assertions and is currently considering its rights and remedies to recover the LLI. At this time, the Company cannot predict the outcome related to this dispute, including, without limitation, the likelihood of any settlement or the probability of success with respect to any litigation that the Company may determine to commence with respect to the LLI.

6

Capitalized Interest and Depreciation Expense

The following table summarizes capitalized interest (in thousands):   

	Three Months Ended   June 30,						Six Months Ended   June 30,
	2016			2015			2016			2015
Interest costs eligible to be capitalized	$	11,947		$	10,589		$	23,792		$	20,705
Interest costs recorded in interest income (expense), net	(8,565		)	(8,125		)	(17,144		)	(16,049		)
Net interest capitalized	$	3,382		$	2,464		$	6,648		$	4,656

The following table summarizes depreciation expense (in thousands): 

	Three Months Ended   June 30,				Six Months Ended   June 30,
	2016		2015		2016		2015
Depreciation expense	$	19,118	$	19,127	$	38,168	$	38,030

3. LONG-TERM DEBT AND OTHER FINANCING ARRANGEMENTS

As required by U.S. GAAP, the Company adopted the provisions of ASU No. 2015-03, Interest - Imputation of Interest - Simplifying the Presentation of Debt Issue Costs during the quarter ended March 31, 2016. ASU 2015-03 requires that debt issuance costs related to a recognized debt liability be presented in the condensed consolidated balance sheets as a reduction in the carrying amount of the related debt liability, consistent with debt discounts. The Company has applied the provisions of this ASU on a retrospective basis, and therefore, the Company has reduced long-term debt on its condensed consolidated balance sheet as of December 31, 2015 by $57.9 million of deferred financing costs previously reported as assets.

Long-term debt consists of the following (in thousands): 

	June 30, 2016						December 31, 2015
	Principal Amount		Unamortized Discount and Deferred Financing Costs		Carrying Value		Principal Amount		Unamortized Discount and Deferred Financing Costs		Carrying Value
Facility Agreement	$	559,429	$	51,702	$	507,727	$	575,846	$	57,829	$	518,017
Thermo Loan Agreement	88,400		31,136		57,264		83,222		32,558		50,664
8.00% Convertible Senior Notes Issued in 2013	16,936		3,465		13,471		16,747		4,307		12,440
Total Debt	664,765		86,303		578,462		675,815		94,694		581,121
Less: Current Portion	38,112		—		38,112		32,835		—		32,835
Long-Term Debt	$	626,653	$	86,303	$	540,350	$	642,980	$	94,694	$	548,286

The principal amounts shown above include payment of in-kind interest, as applicable. The carrying value is net of deferred financing costs and any discounts to the loan amounts at issuance, including accretion, as further described below. The current portion of long-term debt represents the scheduled principal repayments under the Facility Agreement due within one year of the balance sheet date.

7

Facility Agreement

On July 31, 2013, the Company entered into a Global Deed of Amendment and Restatement with Thermo, the Company's domestic subsidiaries, a syndicate of bank lenders, including BNP Paribas, Société Générale, Natixis, Credit Agricole Corporate and Investment Bank and Credit Industrial et Commercial, as arrangers, and BNP Paribas, as the security agent and COFACE Agent, providing for the amendment and restatement of its former facility agreement and certain related credit documents effective August 22, 2013 (the amended and restated facility agreement is herein referred to as the "Facility Agreement"). On August 7, 2015, the Company, Thermo, the lenders and their agent entered into a Second Global Amendment and Restatement Agreement (the "2015 GARA").

The Facility Agreement is scheduled to mature in December 2022. As of June 30, 2016, the Facility Agreement was fully drawn. Semi-annual principal repayments began in December 2014. The facility bears interest at a floating rate of LIBOR plus 2.75% through June 2017, increasing by an additional 0.5% each year thereafter to a maximum rate of LIBOR plus 5.75%. Ninety-five percent of the Company’s obligations under the Facility Agreement are guaranteed by COFACE, the French export credit agency. The Company’s obligations under the Facility Agreement are guaranteed on a senior secured basis by all of its domestic subsidiaries and are secured by a first priority lien on substantially all of the assets of the Company and its domestic subsidiaries (other than their FCC licenses), including patents and trademarks, 100% of the equity of the Company’s domestic subsidiaries and 65% of the equity of certain foreign subsidiaries.  

The Facility Agreement contains customary events of default and requires that the Company satisfy various financial and non-financial covenants. Pursuant to the terms of the Facility Agreement, the Company has the ability to cure noncompliance with financial covenants with Equity Cure Contributions (as described below) through a date as late as June 2019. If the Company violates any of these covenants and is unable to make a sufficient Equity Cure Contribution or obtain a waiver, it would be in default under the agreement and payment of the indebtedness could be accelerated. The acceleration of the Company's indebtedness under one agreement may permit acceleration of indebtedness under other agreements that contain cross-acceleration provisions. The covenants in the Facility Agreement limit the Company's ability to, among other things, incur or guarantee additional indebtedness; make certain investments, acquisitions or capital expenditures above certain agreed levels; pay dividends or repurchase or redeem capital stock or subordinated indebtedness; grant liens on its assets; incur restrictions on the ability of its subsidiaries to pay dividends or to make other payments to the Company; enter into transactions with its affiliates; merge or consolidate with other entities or transfer all or substantially all of its assets; and transfer or sell assets. As of June 30, 2016, the Company was in compliance with respect to the covenants of the Facility Agreement.

The compliance calculations of the financial covenants of the Facility Agreement permit inclusion of certain cash funds contributed to the Company from the issuance of the Company's common stock and/or subordinated indebtedness. These funds are referred to as "Equity Cure Contributions" and may be funded in order to achieve compliance with financial covenants, subject to the conditions set forth in the Facility Agreement. Each Equity Cure Contribution must be made in a minimum amount of $10 million for each measurement period or in the aggregate for all periods until the date that such funding is no longer allowed by the Facility Agreement. In August 2015 and February 2016, the Company drew $15 million and $6.5 million, respectively, under its common stock purchase agreement with Terrapin Opportunity, L.P. ("Terrapin") (the "August 2015 Terrapin Agreement"). The Company used a portion of these funds as an Equity Cure Contribution under the Facility Agreement with respect to the calculation of compliance with financial covenants for the measurement period ended December 31, 2015. In June 2016, the Company drew $22 million under the August 2015 Terrapin Agreement. The Company used these funds as an Equity Cure Contribution under the Facility Agreement with respect to the calculation of compliance with financial covenants for the measurement period ended June 30, 2016. The Company may draw the remaining amounts available under the August 2015 Terrapin Agreement to achieve compliance with certain financial covenants under the Facility Agreement.

The Facility Agreement requires the Company to maintain a total of $37.9 million in a debt service reserve account, which is pledged to secure all of the Company's obligations under the Facility Agreement. The use of these funds is restricted to making principal and interest payments under the Facility Agreement. As of June 30, 2016, the balance in the debt service reserve account, which was established with the proceeds of the loan agreement with Thermo discussed below, was $37.9 million and classified as restricted cash on the Company's condensed consolidated balance sheets. 

Thermo Loan Agreement 

In connection with the amendment and restatement of the Facility Agreement, the Company amended and restated its loan agreement with Thermo (as amended and restated, the “Loan Agreement”). All obligations of the Company to Thermo under the Loan Agreement are subordinated to all of the Company’s obligations under the Facility Agreement.

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The Loan Agreement accrues interest at 12% per annum, which is capitalized and added to the outstanding principal in lieu of cash payments. The Company will make payments to Thermo only when permitted by the Facility Agreement. Principal and interest under the Loan Agreement become due and payable six months after the obligations under the Facility Agreement have been paid in full, or earlier if the Company has a change in control or if any acceleration of the maturity of the loans under the Facility Agreement occurs. As of June 30, 2016, $44.9 million of interest had accrued since 2009 with respect to the Loan Agreement; the Loan Agreement is included in long-term debt on the Company’s condensed consolidated balance sheets.

The Company evaluated the various embedded derivatives within the Loan Agreement (See Note 5: Fair Value Measurements for additional information about the embedded derivative in the Loan Agreement). The Company determined that the conversion option and the contingent put feature upon a fundamental change required bifurcation from the Loan Agreement. The conversion option and the contingent put feature were not deemed clearly and closely related to the Loan Agreement and were separately accounted for as a standalone derivative. The Company recorded this compound embedded derivative liability as a non-current liability on its condensed consolidated balance sheets with a corresponding debt discount, which is netted against the face value of the Loan Agreement.

The Company is accreting the debt discount associated with the compound embedded derivative liability to interest expense through the maturity of the Loan Agreement using an effective interest rate method. The fair value of the compound embedded derivative liability is marked-to-market at the end of each reporting period, with any changes in value reported in the condensed consolidated statements of operations. The Company determines the fair value of the compound embedded derivative using a blend of a Monte Carlo simulation model and market prices.

In connection with, and as a condition to the effectiveness of, the 2015 GARA, Thermo and certain of its affiliates executed and delivered to the agent under the Facility Agreement an undertaking (the “Second Thermo Group Undertaking Letter”) in which they agreed that, during the period commencing on the effective date of the 2015 GARA and ending on the later of March 31, 2018 and, if the Company's 8.00% Notes Issued in 2013 shall have been redeemed in full, September 30, 2019 (the “Commitment Period”), under certain circumstances, they will make, or cause to be made, available to the Company cash equity financing in the aggregate amount of up to $30.0 million.

The balance of this commitment is reduced by any cash equity financing received by the Company during the Commitment Period from Thermo or an external equity funding source, including Terrapin, if the Company uses the funds as an Equity Cure Contribution.

Simultaneously with the execution of the 2015 GARA and the Second Thermo Group Undertaking Letter, the Company entered into an Equity Commitment Agreement (the “Equity Agreement”) and the Loan Agreement.

Pursuant to the Equity Agreement, Thermo agreed to make, or cause to be made, available to the Company up to $30.0 million in additional cash equity investments as contemplated by the 2015 GARA and the Second Thermo Group Undertaking Letter. The price per share that Thermo will pay to purchase any shares of the Company's common stock pursuant to this equity commitment will be established using the same method as used to establish the price per share under the August 2015 Terrapin Agreement. If the issuance of shares of voting common stock to Thermo pursuant to the Equity Agreement would constitute a “Change of Control,” “Default” or “Event of Default” under any applicable agreement, the Company will issue instead an equal number of shares of non-voting common stock.

Since the inception of the 2015 GARA, the Company has received cash equity financing in excess of Thermo's equity commitment. This cash equity financing primarily includes draws under the August 2015 Terrapin Agreement in August 2015, February 2016, and June 2016 for $15.0 million, $6.5 million, and $22.0 million, respectively. As a result, Thermo has no remaining cash equity commitment under the Equity Agreement as of June 30, 2016.

All of the transactions between the Company and Thermo and its affiliates were reviewed and approved on the Company's behalf by a Special Committee of its independent directors, who were represented by independent counsel.

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8.00% Convertible Senior Notes Issued in 2013

The 8.00% Convertible Senior Notes Issued in 2013 (the "2013 8.00% Notes") initially were convertible into shares of common stock at a conversion price of $0.80 per share of common stock, or 1,250 shares of the Company’s common stock per $1,000 principal amount of the 2013 8.00% Notes, subject to adjustment. The conversion price of the 2013 8.00% Notes is adjusted in the event of certain stock splits or extraordinary share distributions, or as a reset of the base conversion and exercise price pursuant to the terms of the Fourth Supplemental Indenture between the Company and U.S. Bank National Association, as Trustee, dated May 20, 2013 (the "Indenture"). Due to common stock issuances by the Company since May 20, 2013 at prices below the then effective conversion rate, the base conversion price (rounded to the nearest cent) has been reduced to $0.73 per share of common stock as of June 30, 2016. 

The 2013 8.00% Notes are senior unsecured debt obligations of the Company with no sinking fund. The 2013 8.00% Notes will mature on April 1, 2028, subject to various call and put features, and bear interest at a rate of 8.00% per annum. Interest on the 2013 8.00% Notes is payable semi-annually in arrears on April 1 and October 1 of each year. Interest is paid in cash at a rate of 5.75% per annum and in additional notes at a rate of 2.25% per annum. The Indenture for the 2013 8.00% Notes provides for customary events of default. As of June 30, 2016, the Company was in compliance with respect to the terms of the 2013 8.00% Notes and the Indenture. 

Subject to certain conditions set forth in the Indenture, the Company may redeem the 2013 8.00% Notes, with the prior approval of the majority lenders under the Facility Agreement, in whole or in part, at any time on or after April 1, 2018, at a price equal to the principal amount of the 2013 8.00% Notes to be redeemed plus all accrued and unpaid interest thereon. 

A holder of the 2013 8.00% Notes has the right, at the holder’s option, to require the Company to purchase some or all of the 2013 8.00% Notes held by it on each of April 1, 2018 and April 1, 2023 at a price equal to the principal amount of the 2013 8.00% Notes to be purchased plus accrued and unpaid interest. 

Subject to the procedures for conversion and other terms and conditions of the Indenture, a holder may convert its 2013 8.00% Notes at its option at any time prior to the close of business on the business day immediately preceding April 1, 2028, into shares of common stock (or, at the option of the Company, cash in lieu of all or a portion thereof, provided that, under the Facility Agreement, the Company may pay cash only with the consent of the Majority Lenders). 

As of June 30, 2016, holders had converted a total of $39.4 million principal amount of the 2013 8.00% Notes, resulting in the issuance of approximately 72.1 million shares of voting common stock. There were no conversions during the three and six month periods ended June 30, 2016. During the three-month period ended June 30, 2015, holders converted a total of $6.3 million principal amount of the 2013 8.00% Notes, resulting in the issuance of approximately 10.4 million shares of voting common stock, and recognition of a loss on extinguishment of debt of $2.2 million. During the six-month period ended June 30, 2015, holders converted a total of $6.5 million principal amount of the 2013 8.00% Notes, resulting in the issuance of approximately 10.9 million shares of voting common stock, and recognition of a loss on extinguishment of debt of $2.3 million.

Holders who convert 2013 8.00% Notes receive conversion shares over a 40-consecutive trading day settlement period. Accordingly, the portion of converted debt is extinguished on an incremental basis over the 40-day settlement period, reducing the Company's outstanding debt balance. As of June 30, 2016, no conversions had been initiated but not yet fully settled.

The Company evaluated the various embedded derivatives within the Indenture for the 2013 8.00% Notes. The Company determined that the conversion option and the contingent put feature within the Indenture required bifurcation from the 2013 8.00% Notes. The Company did not deem the conversion option and the contingent put feature to be clearly and closely related to the 2013 8.00% Notes and separately accounted for them as a standalone derivative. The Company recorded this compound embedded derivative liability as a non-current liability on its condensed consolidated balance sheets with a corresponding debt discount which is netted against the face value of the 2013 8.00% Notes. 

The Company is accreting the debt discount associated with the compound embedded derivative liability to interest expense through the first put date of the 2013 8.00% Notes (April 1, 2018) using an effective interest rate method. The Company is marking to market the fair value of the compound embedded derivative liability at the end of each reporting period, with any changes in value reported in the condensed consolidated statements of operations. The Company determines the fair value of the compound embedded derivative using a blend of a Monte Carlo simulation model and market prices. 

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Warrants Outstanding

Warrants are outstanding to purchase shares of common stock as shown in the table below: 

	Outstanding Warrants		Strike Price
	June 30, 2016	December 31, 2015	June 30, 2016		December 31, 2015
Contingent Equity Agreement (1)	24,571,428	30,191,866	$	0.01	$	0.01
5.0% Warrants (2)	—	8,000,000	—		0.32
	24,571,428	38,191,866

(1) Pursuant to the terms of the Contingent Equity Agreement with Thermo (See Note 9: Related Party Transactions in the Consolidated Financial Statements in the 2015 Annual Report for a description of the Contingent Equity Agreement), the Company issued to Thermo warrants to purchase shares of common stock pursuant to the annual availability fee and subsequent reset provisions in the Contingent Equity Agreement. These warrants were issued between June 2009 and June 2012 and have a five-year exercise period from issuance. As of June 30, 2016, Thermo had exercised warrants to purchase approximately 16.9 million of these shares prior to the expiration of the associated warrants. In June 2016, Thermo exercised warrants to purchase 5.6 million shares of voting common stock for a total purchase price of $0.1 million. The exercise period for the remaining outstanding warrants expires in June 2017.

(2) In June 2011, the Company issued warrants (the “5.0% Warrants”) to purchase 15.2 million shares of its voting common stock in connection with the issuance of its 5.0% Convertible Senior Unsecured Notes. In June 2016, Thermo exercised all of the remaining warrants outstanding to purchase 8.0 million shares of voting common stock for a total purchase price of $2.5 million. See Note 3: Long-Term Debt and Other Financing Arrangements in the Consolidated Financial Statements in the 2015 Annual Report for a complete description of the 5.0% Warrants.

Terrapin Opportunity, L.P. Common Stock Purchase Agreement

On December 28, 2012 the Company entered into a common stock purchase agreement with Terrapin pursuant to which the Company, subject to certain conditions, could require Terrapin to purchase up to $30.0 million of shares of voting common stock over the 24-month term following the effectiveness of a resale registration statement, which became effective on August 2, 2013. When the Company made a draw under this Terrapin common stock purchase agreement, it issued Terrapin shares of common stock at a price per share calculated as specified in the agreement. During the six months ended June 30, 2015, the Company drew $24.0 million under the agreement and issued 11.1 million shares of voting common stock to Terrapin at an average price of $2.18 per share. Through the term of this agreement, Terrapin purchased a total of 17.2 million shares of voting common stock at a total purchase price of $30.0 million. No funds remain available under this agreement.

In conjunction with the amendment of the Facility Agreement in August 2015 (as discussed above), the Company entered into a new common stock purchase agreement with Terrapin pursuant to which the Company may require Terrapin to purchase up to $75.0 million of shares of the Company’s voting common stock over the 24-month term following the date of the agreement. From time to time over the 24-month term, in the Company’s discretion, the Company may present Terrapin with up to 24 draw notices requiring Terrapin to purchase a specified dollar amount of shares of voting common stock, based on the price per share per day over ten consecutive trading days (a "Draw Down Period"). The per share purchase price for these shares of voting common stock will equal the daily volume weighted average price of the common stock on each date during the Draw Down Period on which shares are purchased by Terrapin, but not less than a minimum price specified by the Company (a “Threshold Price”), less a discount ranging from 2.75% to 4.00% based on the Threshold Price. In addition, in the Company’s discretion, but subject to certain limitations, the Company may grant to Terrapin the option to purchase additional shares during a Draw Down Period. The Company has agreed not to sell to Terrapin a number of shares of voting common stock that, when aggregated with all other shares of voting common stock then beneficially owned by Terrapin and its affiliates, would result in their beneficial ownership of more than 9.9% of the then issued and outstanding shares of voting common stock. As discussed above in this Note 3: Long-Term Debt and Other Financing Arrangements and in Note 9: Related Party Transactions, Thermo committed, under certain conditions, to purchase equity securities of the Company on the same pricing terms as the August 2015 Terrapin Agreement.

In August 2015, the Company drew $15.0 million under the August 2015 Terrapin Agreement and issued 9.3 million shares of voting common stock to Terrapin at an average price of $1.61 per share. In February 2016, the Company drew $6.5 million under the August 2015 Terrapin Agreement and issued 6.4 million shares of voting common stock to Terrapin at an average price of $1.02 per share. In June 2016, the Company drew $22.0 million under the August 2015 Terrapin Agreement and issued 19.5 million

11

shares of voting common stock to Terrapin at an average price of $1.13 per share. As of June 30, 2016, $31.5 million remained available under the August 2015 Terrapin Agreement. The Company will make additional draws from time to time under the August 2015 Terrapin Agreement to be used as Equity Cure Contributions under the Facility Agreement or for general corporate purposes.

4. DERIVATIVES

In connection with certain existing and past borrowing arrangements, the Company was required to record derivative instruments on its condensed consolidated balance sheets. None of these derivative instruments is designated as a hedge. The following tables disclose the fair values of the derivative instruments on the Company’s condensed consolidated balance sheets (in thousands):

	June 30, 2016			December 31, 2015
Derivative assets:
Interest rate cap	$	1		$	6
Total derivative assets	$	1		$	6
Derivative liabilities:
Compound embedded derivative with 2013 8.00% Notes	$	(20,420	)	$	(26,203	)
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	(180,062		)	(213,439		)
Total derivative liabilities	$	(200,482	)	$	(239,642	)

 The following table discloses the changes in value recorded as derivative gain (loss) in the Company’s condensed consolidated statement of operations (in thousands): 

	Three Months Ended						Six Months Ended
	June 30, 2016			June 30, 2015			June 30, 2016			June 30, 2015
Interest rate cap	$	(1	)	$	(6	)	$	(5	)	$	(27	)
Compound embedded derivative with 2013 8.00% Notes	5,335			37,928			5,783			18,892
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	35,165			199,165			33,377			110,357
Total derivative gain	$	40,499		$	237,087		$	39,155		$	129,222

Intangible and Other Assets

Interest Rate Cap

In June 2009, in connection with entering into the Facility Agreement, under which interest accrues at a variable rate, the Company entered into fiveten-year interest rate cap agreements. The interest rate cap agreements reflect a variable notional amount at interest rates that provide coverage to the Company for exposure resulting from escalating interest rates over the term of the Facility Agreement. The interest rate cap provides limits on the six-month Libor rate (“Base Rate”) used to calculate the coupon interest on outstanding amounts on the Facility Agreement and is capped at 5.50% should the Base Rate not exceed 6.5%. Should the Base Rate exceed 6.5%, the Company’s Base Rate will be 1% less than the then six-month Libor rate. The Company paid an approximately $12.4 million upfront fee for the interest rate cap agreements. The interest rate cap did not qualify for hedge accounting treatment, and changes in the fair value of the agreements are included in the condensed consolidated statements of operations.

Derivative Liabilities

The Company has identified various embedded derivatives resulting from certain features in the Company’s debt instruments. These embedded derivatives required bifurcation from the debt host agreement. All embedded derivatives that required bifurcation are recorded as a derivative liability on the Company’s condensed consolidated balance sheets with a corresponding debt discount netted against the principal amount of the related debt instrument. The Company accretes the debt discount associated with each derivative liability to interest expense over the term of the related debt instrument using an effective interest rate method. The fair value of each embedded derivative liability is marked-to-market at the end of each reporting period with any changes in value reported in its condensed consolidated statements of operations. Each liability and the features embedded in the debt instrument, which required the Company to account for the instrument as a derivative, are described below.

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Compound Embedded Derivative with the 2013 8.00% Notes

As a result of the conversion option and the contingent put feature within the 2013 8.00% Notes, the Company recorded a compound embedded derivative liability on its condensed consolidated balance sheets with a corresponding debt discount that is netted against the face value of the 2013 8.00% Notes. The Company determined the fair value of the compound embedded derivative liability using a blend of a Monte Carlo simulation model and market prices. 

Compound Embedded Derivative with the Amended and Restated Thermo Loan Agreement

As a result of the conversion option and the contingent put feature within the Thermo Loan Agreement, the Company recorded a compound embedded derivative liability on its condensed consolidated balance sheets with a corresponding debt discount that is netted against the face value of the Amended and Restated Loan Agreement. The Company determined the fair value of the compound embedded derivative liability using a blend of a Monte Carlo simulation model and market prices.

5. FAIR VALUE MEASUREMENTS

The Company follows the authoritative guidance for fair value measurements relating to financial and non-financial assets and liabilities, including presentation of required disclosures herein. This guidance establishes a fair value framework requiring the categorization of assets and liabilities into three levels based upon the assumptions (inputs) used to price the assets and liabilities.  Level 1 provides the most reliable measure of fair value, whereas Level 3 generally requires significant management judgment.  The three levels are defined as follows:

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities.

Level 2: Quoted prices in markets that are not active or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability. 

Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).

Recurring Fair Value Measurements

The following table provides a summary of the financial assets and liabilities measured at fair value on a recurring basis (in thousands): 

	June 30, 2016
	(Level 1)		(Level 2)			(Level 3)			Total  Balance
Assets:
Interest rate cap	$	—	$	1		$	—		$	1
Total assets measured at fair value	$	—	$	1		$	—		$	1
Liabilities:
Liability for potential stock issuance to Hughes	$	—	$	(7,418	)	$	—		$	(7,418	)
Compound embedded derivative with 2013 8.00% Notes	—		—			(20,420		)	(20,420		)
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	—		—			(180,062		)	(180,062		)
Total liabilities measured at fair value	$	—	$	(7,418	)	$	(200,482	)	$	(207,900	)

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	December 31, 2015
	(Level 1)		(Level 2)			(Level 3)			Total  Balance
Assets:
Interest rate cap	$	—	$	6		$	—		$	6
Total assets measured at fair value	$	—	$	6		$	—		$	6
Liabilities:
Liability for potential stock issuance to Hughes	$	—	$	(5,495	)	$	—		$	(5,495	)
Compound embedded derivative with 2013 8.00% Notes	—		—			(26,203		)	(26,203		)
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	—		—			(213,439		)	(213,439		)
Total liabilities measured at fair value	$	—	$	(5,495	)	$	(239,642	)	$	(245,137	)

Assets 

Interest Rate Cap

The fair value of the interest rate cap is determined using observable pricing inputs including benchmark yields, reported trades, and broker/dealer quotes at the reporting date. See Note 4: Derivatives for further discussion.

Liabilities 

Liability for potential stock issuance to Hughes

The Company has one liability classified as Level 2. As described in Note 7: Commitments, the Company agreed to provide downside protection after the issuance of shares of common stock to Hughes in lieu of cash for contract payments in June 2015. This feature requires the Company to issue to Hughes additional shares of common stock equal to the difference, if any, between $15.5 million and the total amount of gross proceeds Hughes receives from the sale of any shares plus the market value of any shares still held by Hughes as of the close of trading on September 30, 2016. The value of this option is calculated using a Black-Scholes pricing model. This liability is marked-to-market at each balance sheet date and through the settlement date.

Derivative Liabilities

The Company has two derivative liabilities classified as Level 3. The Company marks-to-market these liabilities at each reporting date with the changes in fair value recognized in the Company’s condensed consolidated statements of operations. See Note 4: Derivatives for further discussion. 

The significant quantitative Level 3 inputs utilized in the valuation models are shown in the tables below: 

	June 30, 2016
	Stock Price Volatility	Risk-Free Interest Rate		Note Conversion Price		Market Price of Common Stock
Compound embedded derivative with the 2013 8.00% Notes	100% - 130%	0.5	%	$	0.73	$	1.21
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	40% - 130%	1.3	%	$	0.73	$	1.21

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	December 31, 2015
	Stock Price Volatility	Risk-Free Interest Rate		Note Conversion Price		Market Price of Common Stock
Compound embedded derivative with 2013 8.00% Notes	75% - 90%	1.1	%	$	0.73	$	1.44
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	50% - 90%	2.1	%	$	0.73	$	1.44

Fluctuation in the Company’s stock price is the primary driver for the changes in the derivative valuations during each reporting period. As the stock price decreases towards the current conversion price for each of the related derivative instruments, the value to the holder of the instrument generally decreases, thereby decreasing the liability on the Company’s condensed consolidated balance sheets. These valuations are sensitive to the weighting applied to each of the simulated values. Additionally, stock price volatility is one of the significant unobservable inputs used in the fair value measurement of each of the Company’s derivative instruments. The simulated fair value of these liabilities is sensitive to changes in the expected volatility of the Company's stock price. Decreases in expected volatility would generally result in a lower fair value measurement. 

Probability of a change of control is another significant unobservable input used in the fair value measurement of the Company’s derivative instruments. Subject to certain restrictions in each indenture, the Company’s debt instruments contain certain provisions whereby holders may require the Company to purchase all or any portion of the convertible debt instrument upon a change of control. A change of control will occur upon certain changes in the ownership of the Company or certain events relating to the trading of the Company’s common stock. The simulated fair value of the derivative liabilities above is sensitive to changes in the assumed probabilities of a change of control. Decreases in the assumed probability of a change of control would generally result in a lower fair value measurement. 

In addition to the inputs described above, the valuation model used to calculate the fair value measurement of the compound embedded derivatives within the Company’s 2013 8.00% Notes and Thermo Loan Agreement included the following inputs and features: payment in kind interest payments, make whole premiums, a 40-day stock issuance settlement period upon conversion, automatic conversions, and the principal balance of each loan at the balance sheet date. There are also certain put and call features within the 2013 8.00% Notes that impact the valuation model. The trading activity in the market provides the Company with additional valuation support. The Company uses a weight factor to calculate the fair value of the embedded derivatives to align the fair value produced from the Monte Carlo simulation model with the market value of the 2013 8.00% Notes. Due to the similarities of the debt instruments, the Company applies a similar weight to the embedded derivative in the Thermo Loan Agreement. These valuations are sensitive to the weighting applied to each of the simulated values.

The following table presents a rollforward for all liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in thousands):

	Three months ended June 30,						Six months ended June 30,
	2016			2015			2016			2015
Balance at beginning of period	$	(240,982	)	$	(548,526	)	$	(239,642	)	$	(441,550	)
Derivative adjustment related to conversions	—			19,140			—			20,008
Unrealized gain, included in derivative gain	40,500			237,093			39,160			129,249
Balance at end of period	$	(200,482	)	$	(292,293	)	$	(200,482	)	$	(292,293	)

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Fair Value of Debt Instruments

The Company believes it is not practicable to determine the fair value of the Facility Agreement. Unlike typical long-term debt, interest rates and other terms for the Facility Agreement are not readily available and generally involve a variety of factors, including due diligence by the debt holders. As such, it is not practicable to determine the fair value of the Facility Agreement without incurring significant additional costs. The following table sets forth the carrying values and estimated fair values of the Company's other debt instruments, which are classified as Level 3 financial instruments (in thousands):

	June 30, 2016				December 31, 2015
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Thermo Loan Agreement	$	57,264	$	29,207	$	50,664	$	17,244
2013 8.00% Notes	13,471		12,111		12,440		9,831

6. ACCRUED EXPENSES AND OTHER NON-CURRENT LIABILITIES

Accrued expenses consist of the following (in thousands): 

	June 30, 2016		December 31, 2015
Accrued interest	$	319	$	317
Accrued compensation and benefits	2,927		2,098
Accrued property and other taxes	4,391		4,125
Accrued customer liabilities and deposits	3,336		3,216
Accrued professional and other service provider fees	2,401		1,830
Accrued commissions	969		1,216
Accrued telecommunications expenses	865		1,487
Accrued inventory	217		502
Accrued liability for potential stock issuance to Hughes	7,418		5,495
Accrued liability for legal settlement	1,422		328
Other accrued expenses	2,690		1,825
Total accrued expenses	$	26,955	$	22,439

Accrued liability for potential stock issuance to Hughes includes the estimated value at June 30, 2016 of the downside protection that the Company provided to Hughes in connection with its April 2015 agreement (as amended).  See Note 5: Fair Value Measurements and Note 7: Commitments for further discussion.

Other accrued expenses include primarily capital lease obligations, occupancy costs, payments to independent gateway operators ("IGOs") and estimated payroll shortfall under the Cooperative Endeavor Agreement with the Louisiana Department of Economic Development. 

Other non-current liabilities consist of the following (in thousands):   

	June 30, 2016		December 31, 2015
Long-term accrued interest	$	96	$	96
Asset retirement obligation	1,373		1,302
Deferred rent and other deferred expense	561		593
Liability related to the Cooperative Endeavor Agreement with the State of Louisiana	616		716
Uncertain income tax positions	6,352		5,795
Foreign tax contingencies	2,706		2,311
Capital lease obligations	227		94
Total other non-current liabilities	$	11,931	$	10,907

16

As a result of the expiration of the statute of limitations associated with the tax position of one of the Company's foreign subsidiaries, the Company anticipates removing the total position of $6.4 million in the Company’s unrecognized tax benefits, inclusive of cumulative interest and penalties, from its non-current liabilities during the quarter ending September 30, 2016.

7. COMMITMENTS

Contractual Obligations - Second-Generation Satellites, Next-Generation Gateways and Other Ground Facilities 

As of June 30, 2016, the Company had purchase commitments with Thales, Hughes and Ericsson related to the procurement, deployment and maintenance of the second-generation network.  

Second-Generation Satellites

As of June 30, 2016, the Company had a contract with Thales for the construction of the Company’s second-generation low-earth orbit satellites and related services. The Company has successfully launched all of these second-generation satellites, excluding one on-ground spare. The Company and Thales have discussed the ownership of certain deliverables under this contract but have been unable to reach an agreement.

Effective October 24, 2014, the Company entered into a contract with Thales for in-orbit support services for the second-generation satellites delivered under the 2009 contract described in Note 2: Property and Equipment. These services will be performed over a three-year period for a total cost of approximately €1.9 million. A credit of €0.6 million was applied to the total cost, reducing the first annual payment to €0. This credit results from a settlement of amounts previously paid in conjunction with the 2009 contract.

Next-Generation Gateways and Other Ground Facilities

Hughes Network Systems

In May 2008, the Company entered into a contract with Hughes under which Hughes will design, supply and implement the Radio Access Network (RAN) ground network equipment and software upgrades for installation at a number of the Company’s satellite gateway ground stations and satellite interface chips to be used in various second-generation Globalstar devices.

In March 2015, the Company entered into an agreement with Hughes for the design, development, build, testing and delivery of four custom test equipment units for a total of $1.9 million. This test equipment was delivered during the fourth quarter of 2015. In April 2015, the Company extended the scope of work for delivery of two additional RANs for a total of $4.0 million. These RANs were delivered in February 2016. In July 2015, the Company and Hughes formally amended the contract to include the revised scope of work set forth in the March 2015 and April 2015 letter agreements.

In April 2015, Hughes exercised an option to be paid in shares of the Company's common stock (at a price 7% below market) in lieu of cash for certain of its remaining contract payments, including those related to the 2015 work mentioned above, totaling approximately $15.5 million. In June 2015, the Company issued 7.4 million shares of freely tradable common stock at the 7% discount pursuant to this option. The portion of these contract payments related to future milestone work is included in Prepaid second-generation ground costs on the condensed consolidated balance sheets as of June 30, 2016. As the contract milestones are achieved, the Company will reclassify the related costs from Prepaid second-generation ground costs to construction in progress within Property and equipment. In the April 2015 agreement (as amended), the Company agreed to provide downside protection through September 30, 2016. This feature requires that the Company issue additional shares of common stock equal to the difference, if any, between $15.5 million and the total amount of gross proceeds Hughes receives from the sale of any shares plus the market value of any shares still held by Hughes as of the close of trading on September 30, 2016. Pursuant to this agreement, the Company recorded a liability of $7.4 million as of June 30, 2016 and $5.5 million as of December 31, 2015, respectively. The Company calculated these estimates of the value of this option using a Black-Scholes pricing model. This liability is marked-to-market at each balance sheet date and through the settlement date. The Company records gains and losses resulting from changes in the value of this liability in its condensed consolidated statement of operations.

17

Ericsson

In October 2008, the Company entered into a contract with Ericsson to develop, implement and maintain a ground interface, or core network system, which will be installed at a number of the Company’s satellite gateway ground stations. In July 2014, the parties signed an amended and restated contract to specify the remaining contract value and a new milestone schedule to reflect a revised program timeline. Prior to the amended and restated contract being finalized, Ericsson and the Company agreed to defer certain milestone payments previously due under the 2008 contract to 2014 and beyond. The deferred payments were incurring interest at a rate of 6.5% per annum. In April 2015, the Company signed an amendment to the 2014 contract to incorporate certain changes in scope and timing identified as necessary by the parties. In conjunction with signing this amendment, the parties executed a new letter agreement under which Ericsson waived the remaining $1.0 million in deferred milestone payments and $0.4 million in interest accrued on the milestone payments under the 2008 contract. In the first quarter of 2015, the Company reversed these amounts from accounts payable, accrued expenses and construction in progress on the Company's condensed consolidated balance sheet. In August 2015, the Company and Ericsson executed a second amendment to the 2014 contract which incorporated revised payment and pricing schedules. This amendment also reflected an accelerated timeline for the project providing that the work was estimated to be completed in the second quarter, instead of the third quarter, of 2016. During the second quarter of 2016, the Company took possession of the final Ericsson hardware for the Company's global deployment. As of June 30, 2016, the remaining amount due under the contract is $6.0 million, which is related to the final acceptance of all contract deliverables.

Other Second-Generation Commitments

The Company has signed various licensing and royalty agreements necessary for the manufacture and distribution of its second-generation products. The Company will pay or has paid license fees for new product technology with royalty fees payable on a per unit basis as these units are manufactured, sold, or activated. 

8. CONTINGENCIES

Arbitration 

On June 3, 2011, Globalstar filed a demand for arbitration against Thales before the American Arbitration Association to enforce certain rights to order additional satellites under the 2009 Contract. The Company did not include within its demand any claims that it had against Thales for work previously performed under the contract to design, manufacture and timely deliver the first 25 second-generation satellites. On May 10, 2012, the arbitration tribunal issued its award in which it determined that the Company had terminated the 2009 Contract "for convenience" and had materially breached the contract by failing to pay to Thales the €51.3 million in termination charges required under the contract. The tribunal additionally determined that absent further agreement between the parties, Thales had no further obligation to manufacture or deliver satellites under Phase 3 of the 2009 Contract. Based on these determinations, the tribunal directed the Company to pay Thales approximately €53 million in termination charges, plus interest by June 9, 2012. On May 23, 2012, Thales commenced an action in the United States District Court for the Southern District of New York by filing a petition to confirm the arbitration award (the “New York Proceeding”). Thales and the Company entered into a tolling agreement as of June 13, 2013, under which Thales dismissed the New York Proceeding without prejudice. The tolling agreement has expired. Thales may refile the petition at a later date and pursue the confirmation of the arbitration award, which the Company would oppose. Should Thales be successful in confirming the arbitration award, this would have a material adverse effect on the Company's financial condition, results of operations and liquidity.

On June 24, 2012, the Company and Thales agreed to settle their prior commercial disputes, including those disputes that were the subject of the arbitration award. In order to effectuate this settlement, the Company and Thales entered into a Release Agreement, a Settlement Agreement and a Submission Agreement. Under the terms of the Release Agreement, Thales agreed unconditionally and irrevocably to release and forever discharge the Company from any and all claims and obligations (with the exception of those items payable under the Settlement Agreement or in connection with a new contract for the purchase of any additional second-generation satellites), including, without limitation, a full release from paying €35.6 million of the termination charges awarded in the arbitration together with all interest on the award amount effective upon the earlier of December 31, 2012, and the effective date of the financing for the purchase of any additional second-generation satellites. Under the terms of the Release Agreement, the Company agreed unconditionally and irrevocably to release and forever discharge Thales from any and all claims (with limited exceptions), including, without limitation, claims related to Thales’ work under the 2009 satellite construction contract, including any obligation to pay liquidated damages, effective upon the earlier of December 31, 2012, and the effective date of the financing for the purchase of any additional second-generation satellites. In connection with the Release Agreement and the Settlement Agreement, the Company recorded a contract termination charge of approximately €17.5 million which is recorded in the Company’s condensed consolidated balance sheets as of June 30, 2016 and December 31, 2015. The releases became effective on December 31, 2012.

18

Under the terms of the Settlement Agreement, the Company agreed to pay €17.5 million to Thales, representing one-third of the termination charges awarded to Thales in the arbitration, subject to certain conditions, on the later of the effective date of the new contract for the purchase of any additional second-generation satellites and the effective date of the financing for the purchase of these satellites. As of June 30, 2016, this condition had not been satisfied. Because the effective date of the new contract for the purchase of additional second-generation satellites did not occur on or prior to February 28, 2013, any party may terminate the Settlement Agreement. If any party terminates the Settlement Agreement, all parties’ rights and obligations under the Settlement Agreement shall terminate. The Release Agreement is a separate and independent agreement from the Settlement Agreement and provides that it supersedes all prior understandings, commitments and representations between the parties with respect to the subject matter thereof; therefore it would survive any termination of the Settlement Agreement. As of June 30, 2016, no party had terminated the Settlement Agreement.

Litigation

Due to the nature of the Company's business, the Company is involved, from time to time, in various litigation matters or subject to disputes or routine claims regarding its business activities. Legal costs related to these matters are expensed as incurred. During the second quarter of 2016, the Company increased an accrual related to the settlement of litigation incurred on behalf of the Company's Brazilian subsidiary. As of June 30, 2016, the Company expects the total settlement to be 4.5 million reais, or $1.4 million, which will be paid in Globalstar common stock. In management's opinion, there is no pending litigation, dispute or claim, other than those described in this report, which could be expected to have a material adverse effect on the Company's financial condition, results of operations or liquidity. 

9. RELATED PARTY TRANSACTIONS

Payables to Thermo and other affiliates related to normal purchase transactions were $0.2 million and $0.6 million at each of June 30, 2016 and December 31, 2015, respectively. 

Transactions with Thermo

Expenses incurred by Thermo on behalf of the Company, including non-cash expenses and those expenses charged to the Company, were $0.2 million and $0.4 million during the three months ended June 30, 2016 and 2015, respectively and were $0.3 million and $0.5 million during the six months ended June 30, 2016 and 2015, respectively. Non-cash expenses, which the Company accounts for as a contribution to capital, relate to services provided by two executive officers of Thermo (who are also directors of the Company and receive no cash compensation from the Company). The Thermo expense charges are based on actual amounts (with no mark-up) incurred or upon allocated employee time. 

As of June 30, 2016, the principal amount outstanding under the Loan Agreement with Thermo was $88.4 million, and the fair value of the compound embedded derivative liability associated with the Loan Agreement was $180.1 million. For the three months ended June 30, 2016 and 2015, interest on the Loan Agreement was approximately $2.6 million and $2.2 million, respectively. For the six months ended June 30, 2016 and 2015, interest on the Loan Agreement was approximately $5.2 million and $4.2 million, respectively. In addition, as of June 30, 2016, warrants to purchase approximately 24.6 million shares issued under the Contingent Equity Agreement remain outstanding, all of which are held by Thermo and are scheduled to expire in June 2017. In June 2016, Thermo exercised warrants to purchase 5.6 million and 8.0 million shares of voting common stock related to the Contingent Equity Agreement and the Company's 5.0% Warrants, respectively. As a result of these warrant exercises, the Company received aggregate proceeds of $2.6 million in June 2016.

In August 2015, the Company entered into an Equity Agreement with Thermo. Thermo agreed to purchase up to $30.0 million in equity securities of the Company if the Company so requests or if an event of default is continuing under the Facility Agreement and funds are not available under the August 2015 Terrapin Agreement. As of June 30, 2016, the Company has received cash equity financing in excess of Thermo's equity commitment. This cash equity financing primarily includes draws under the August 2015 Terrapin Agreement in August 2015, February 2016, and June 2016 for $15.0 million, $6.5 million, and $22.0 million, respectively. As a result, Thermo had no remaining cash equity commitment under the Equity Agreement as of June 30, 2016.

The Facility Agreement requires Thermo to maintain minimum and maximum ownership levels in the Company's common stock. Thermo may convert shares of nonvoting common stock into shares of voting common stock as needed to comply with these ownership limitations.

See Note 3: Long-Term Debt and Other Financing Arrangements and Note 4: Derivatives for further discussion of the Company's debt and financing transactions with Thermo.

19

10. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) 

Accumulated other comprehensive income (loss) includes all changes in equity during a period from non-owner sources.

The components of accumulated other comprehensive income (loss) were as follows (in thousands): 

	Three Months Ended June 30,						Six Months Ended June 30,
	2016			2015			2016			2015
Accumulated other comprehensive loss, beginning of period	$	(5,484	)	$	(4,188	)	$	(4,833	)	$	(2,898	)
Other comprehensive income (loss):
Foreign currency translation adjustments	(925		)	447			(1,576		)	(843		)
Accumulated other comprehensive loss, end of period	$	(6,409	)	$	(3,741	)	$	(6,409	)	$	(3,741	)

No amounts were reclassified out of accumulated other comprehensive loss for the periods shown above.

11.  GEOGRAPHIC INFORMATION

The Company attributes subscriber equipment sales to various countries based on the location where equipment is sold. Service revenue is generally attributed to the various countries based on the Globalstar entity that holds the customer contract. Property and equipment is attributed to the various countries based on the physical location of the asset at the end of a given period, except for the Company's satellites that are included in the property and equipment of the United States. The Company’s information by geographic area is as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2016		2015		2016		2015
Revenues:
Service revenue:
United States	$	14,407	$	12,468	$	27,676	$	24,183
Canada	4,066		3,771		7,310		7,204
Europe	1,805		1,541		3,263		2,743
Central and South America	570		688		1,188		1,302
Others	122		148		282		291
Total service revenue	$	20,970	$	18,616	$	39,719	$	35,723
Subscriber equipment sales:
United States	2,226		1,990		3,530		3,578
Canada	1,052		1,278		1,813		2,439
Europe	527		452		956		985
Central and South America	279		424		667		1,057
Others	32		263		237		263
Total subscriber equipment sales	$	4,116	$	4,407	$	7,203	$	8,322
Total revenue	$	25,086	$	23,023	$	46,922	$	44,045

20

	June 30, 2016		December 31, 2015
Property and equipment, net:
United States	$	1,054,493	$	1,073,327
Canada	626		510
Europe	454		484
Central and South America	3,126		2,782
Others	320		457
Total property and equipment, net	$	1,059,019	$	1,077,560

12. EARNINGS (LOSS) PER SHARE

Basic earnings (loss) per share are computed based on the weighted average number of shares of common stock outstanding during the period. Common stock equivalents are included in the calculation of diluted earnings per share only when the effect of their inclusion would be dilutive. 

The following table sets forth the calculation of basic and diluted earnings (loss) per share for the periods indicated (in thousands):

	Three Months Ended   June 30,				Six Months Ended   June 30,
	2016		2015		2016			2015
Net income (loss)	$	14,099	$	204,767	$	(12,848	)	$	75,040
Effect of dilutive securities:
2013 8.00% Notes	537		593		—			1,313
Thermo Loan Agreement	2,401		2,148		—			4,251
Income (loss) to common stockholders plus assumed conversions	$	17,037	$	207,508	$	(12,848	)	$	80,604
Weighted average common shares outstanding:
Basic shares outstanding	1,049,381		1,009,917		1,045,205			1,005,406
Incremental shares from assumed exercises, conversions and other issuances:
Stock options, restricted stock, restricted stock units and ESPP	5,793		8,667		—			8,534
2013 8.00% Notes	27,164		28,001		—			27,778
Thermo Loan Agreement	139,709		120,673		—			119,272
Warrants and other	27,625		38,192		—			38,192
Diluted shares outstanding	1,249,672		1,205,450		1,045,205			1,199,182
Income (loss) per share:
Basic	0.01		0.20		(0.01		)	0.07
Diluted	0.01		0.17		(0.01		)	0.07

For the six months ended June 30, 2016, 197.0 million shares of potential common stock were excluded from diluted shares outstanding because the effects of assuming issuance of these potentially dilutive securities would be anti-dilutive.

13. CONDENSED CONSOLIDATING FINANCIAL INFORMATION

In connection with the Company’s issuance of the 2013 8.00% Notes, certain of the Company’s 100% owned domestic subsidiaries (the “Guarantor Subsidiaries”), fully, unconditionally, jointly, and severally guaranteed the payment obligations under the 2013 8.00% Notes. The following financial information sets forth, on a consolidating basis, the balance sheets, statements of operations and statements of cash flows for Globalstar, Inc. (“Parent Company”), for the Guarantor Subsidiaries and for the Parent Company’s other subsidiaries (the “Non-Guarantor Subsidiaries”).   

The condensed consolidating financial information has been prepared pursuant to the rules and regulations for condensed financial information and does not include disclosures included in annual financial statements. The principal eliminating entries eliminate investments in subsidiaries, intercompany balances and intercompany revenues and expenses. 

21

Globalstar, Inc.

Condensed Consolidating Statement of Operations

Three Months Ended June 30, 2016

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
Revenue:
Service revenues	$	10,944		$	10,863		$	10,689		$	(11,526	)	$	20,970
Subscriber equipment sales	96			2,774			1,997			(751		)	4,116
Total revenue	11,040			13,637			12,686			(12,277		)	25,086
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	5,135			1,034			2,702			(934		)	7,937
Cost of subscriber equipment sales	43			2,112			1,478			(747		)	2,886
Marketing, general and administrative	5,430			1,322			16,219			(11,521		)	11,450
Depreciation, amortization, and accretion	18,851			206			288			(121		)	19,224
Total operating expenses	29,459			4,674			20,687			(13,323		)	41,497
Income (loss) from operations	(18,419		)	8,963			(8,001		)	1,046			(16,411		)
Other income (expense):
Loss on equity issuance	(2,075		)	—			—			—			(2,075		)
Interest income and expense, net of amounts capitalized	(9,000		)	(3		)	(47		)	1			(9,049		)
Derivative gain	40,499			—			—			—			40,499
Equity in subsidiary earnings (loss)	2,924			(968		)	—			(1,956		)	—
Other	170			92			328			95			685
Total other income (expense)	32,518			(879		)	281			(1,860		)	30,060
Income (loss) before income taxes	14,099			8,084			(7,720		)	(814		)	13,649
Income tax benefit	—			—			(450		)	—			(450		)
Net income (loss)	$	14,099		$	8,084		$	(7,270	)	$	(814	)	$	14,099
Comprehensive income (loss)	$	14,099		$	8,084		$	(8,195	)	$	(814	)	$	13,174

22

Globalstar, Inc.

Condensed Consolidating Statement of Operations

Three Months Ended June 30, 2015

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
Revenue:
Service revenues	$	15,932		$	6,865		$	11,213		$	(15,394	)	$	18,616
Subscriber equipment sales	296			2,615			2,993			(1,497		)	4,407
Total revenue	16,228			9,480			14,206			(16,891		)	23,023
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	4,969			1,652			3,037			(1,631		)	8,027
Cost of subscriber equipment sales	78			2,137			3,286			(2,518		)	2,983
Marketing, general and administrative	4,940			1,832			16,561			(13,174		)	10,159
Depreciation, amortization, and accretion	18,778			293			329			(129		)	19,271
Total operating expenses	28,765			5,914			23,213			(17,452		)	40,440
Income (loss) from operations	(12,537		)	3,566			(9,007		)	561			(17,417		)
Other income (expense):
Loss on extinguishment of debt	(2,189		)	—			—			—			(2,189		)
Loss on equity issuance	(2,912		)	—			—			—			(2,912		)
Interest income and expense, net of amounts capitalized	(9,107		)	(5		)	(138		)	6			(9,244		)
Derivative gain	237,087			—			—			—			237,087
Equity in subsidiary earnings (loss)	(5,035		)	1,161			—			3,874			—
Other	(674		)	(132		)	355			(1		)	(452		)
Total other income (expense)	217,170			1,024			217			3,879			222,290
Income (loss) before income taxes	204,633			4,590			(8,790		)	4,440			204,873
Income tax expense (benefit)	(134		)	(8		)	248						106
Net income (loss)	$	204,767		$	4,598		$	(9,038	)	$	4,440		$	204,767
Comprehensive income (loss)	$	204,767		$	4,598		$	(8,591	)	$	4,440		$	205,214

23

Globalstar, Inc.

Condensed Consolidating Statement of Operations

Six Months Ended June 30, 2016

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
Revenue:
Service revenues	$	27,882		$	18,358		$	20,114		$	(26,635	)	$	39,719
Subscriber equipment sales	424			4,466			3,674			(1,361		)	7,203
Total revenue	28,306			22,824			23,788			(27,996		)	46,922
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	9,948			2,070			5,597			(2,087		)	15,528
Cost of subscriber equipment sales	187			3,540			2,693			(1,356		)	5,064
Marketing, general and administrative	10,604			1,854			33,064			(25,462		)	20,060
Depreciation, amortization, and accretion	37,623			426			569			(239		)	38,379
Total operating expenses	58,362			7,890			41,923			(29,144		)	79,031
Income (loss) from operations	(30,056		)	14,934			(18,135		)	1,148			(32,109		)
Other income (expense):
Loss on equity issuance	(1,923		)	—			—			—			(1,923		)
Interest income and expense, net of amounts capitalized	(17,981		)	(12		)	(152		)	(9		)	(18,154		)
Derivative gain	39,155			—			—			—			39,155
Equity in subsidiary earnings (loss)	(1,427		)	2,079			—			(652		)	—
Other	(616		)	(112		)	604			48			(76		)
Total other income (expense)	17,208			1,955			452			(613		)	19,002
Income (loss) before income taxes	(12,848		)	16,889			(17,683		)	535			(13,107		)
Income tax benefit	—			—			(259		)	—			(259		)
Net income (loss)	$	(12,848	)	$	16,889		$	(17,424	)	$	535		$	(12,848	)
Comprehensive income (loss)	$	(12,848	)	$	16,889		$	(19,000	)	$	535		$	(14,424	)

24

Globalstar, Inc.

Condensed Consolidating Statement of Operations

Six Months Ended June 30, 2015

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
Revenue:
Service revenues	$	32,175		$	14,543		$	20,020		$	(31,015	)	$	35,723
Subscriber equipment sales	354			6,064			5,491			(3,587		)	8,322
Total revenue	32,529			20,607			25,511			(34,602		)	44,045
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	9,504			3,177			6,289			(3,509		)	15,461
Cost of subscriber equipment sales	60			5,443			5,732			(5,121		)	6,114
Marketing, general and administrative	9,449			2,991			32,305			(25,990		)	18,755
Depreciation, amortization, and accretion	37,327			591			652			(253		)	38,317
Total operating expenses	56,340			12,202			44,978			(34,873		)	78,647
Income (loss) from operations	(23,811		)	8,405			(19,467		)	271			(34,602		)
Other income (expense):
Loss on extinguishment of debt	(2,254		)	—			—			—			(2,254		)
Loss on equity issuance	(2,912		)	—			—			—			(2,912		)
Interest income and expense, net of amounts capitalized	(17,443		)	(15		)	(309		)	6			(17,761		)
Derivative gain	129,222			—			—			—			129,222
Equity in subsidiary earnings (loss)	(8,949		)	5,426			—			3,523			—
Other	1,132			394			2,102			53			3,681
Total other income (expense)	98,796			5,805			1,793			3,582			109,976
Income (loss) before income taxes	74,985			14,210			(17,674		)	3,853			75,374
Income tax expense (benefit)	(55		)	15			374			—			334
Net income (loss)	$	75,040		$	14,195		$	(18,048	)	$	3,853		$	75,040
Comprehensive income (loss)	$	75,040		$	14,195		$	(18,891	)	$	3,853		$	74,197

25

Globalstar, Inc.

Condensed Consolidating Balance Sheet

As of June 30, 2016

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	7,640		$	807		$	2,822		$	—		$	11,269
Accounts receivable	5,925			6,022			4,217			—			16,164
Intercompany receivables	869,736			644,878			63,659			(1,578,273		)	—
Inventory	2,128			5,058			2,512			—			9,698
Prepaid expenses and other current assets	2,393			330			2,307			—			5,030
Total current assets	887,822			657,095			75,517			(1,578,273		)	42,161
Property and equipment, net	1,051,013			3,479			4,649			(122		)	1,059,019
Restricted cash	37,918			—			—			—			37,918
Intercompany notes receivable	10,717			—			16,295			(27,012		)	—
Investment in subsidiaries	(272,351		)	23,009			34,404			214,938			—
Prepaid second-generation ground costs	4,165			—			—			—			4,165
Intangible and other assets, net	12,739			200			568			(10		)	13,497
Total assets	$	1,732,023		$	683,783		$	131,433		$	(1,390,479	)	$	1,156,760
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	38,112		$	—		$	—		$	—		$	38,112
Accounts payable	2,360			2,571			1,108			—			6,039
Accrued contract termination charge	19,468			—			—			—			19,468
Accrued expenses	13,378			6,047			7,530			—			26,955
Intercompany payables	620,440			725,974			241,038			(1,587,452		)	—
Payables to affiliates	240			—			—			—			240
Deferred revenue	2,007			17,691			5,527			—			25,225
Total current liabilities	696,005			752,283			255,203			(1,587,452		)	116,039
Long-term debt, less current portion	540,350			—			—			—			540,350
Employee benefit obligations	4,894			—			—			—			4,894
Intercompany notes payable	6,004			—			12,860			(18,864		)	—
Derivative liabilities	200,482			—			—			—			200,482
Deferred revenue	5,834			291			—			—			6,125
Debt restructuring fees	20,795			—			—			—			20,795
Other non-current liabilities	1,515			315			10,101			—			11,931
Total non-current liabilities	779,874			606			22,961			(18,864		)	784,577
Stockholders’ equity (deficit)	256,144			(69,106		)	(146,731		)	215,837			256,144
Total liabilities and stockholders’ equity	$	1,732,023		$	683,783		$	131,433		$	(1,390,479	)	$	1,156,760

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Globalstar, Inc.

Condensed Consolidating Balance Sheet

As of December 31, 2015

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	3,530		$	719		$	3,227		$	—		$	7,476
Accounts receivable	4,521			5,215			4,461			339			14,536
Intercompany receivables	859,370			465,488			34,742			(1,359,600		)	—
Inventory	2,148			6,321			3,554			—			12,023
Prepaid expenses and other current assets	2,399			291			1,766			—			4,456
Total current assets	871,968			478,034			47,750			(1,359,261		)	38,491
Property and equipment, net	1,069,605			3,722			4,587			(354		)	1,077,560
Restricted cash	37,918			—			—			—			37,918
Intercompany notes receivable	12,037			—			14,994			(27,031		)	—
Investment in subsidiaries	(298,976		)	9,512			32,946			256,518			—
Prepaid second-generation ground costs	8,929			—			—			—			8,929
Intangible and other assets, net	11,384			280			464			(11		)	12,117
Total assets	$	1,712,865		$	491,548		$	100,741		$	(1,130,139	)	$	1,175,015
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	32,835		$	—		$	—		$	—		$	32,835
Accounts payable	4,292			2,439			1,387			—			8,118
Accrued contract termination charge	19,121			—			—			—			19,121
Accrued expenses	9,816			6,949			5,674			—			22,439
Intercompany payables	580,383			604,999			179,105			(1,364,487		)	—
Payables to affiliates	616			—			—			—			616
Deferred revenue	1,980			17,722			4,200			—			23,902
Total current liabilities	649,043			632,109			190,366			(1,364,487		)	107,031
Long-term debt, less current portion	548,286			—			—			—			548,286
Employee benefit obligations	4,810			—			—			—			4,810
Intercompany notes payable	5,564			—			13,970			(19,534		)	—
Derivative liabilities	239,642			—			—			—			239,642
Deferred revenue	6,027			386			—			—			6,413
Debt restructuring fees	20,795			—			—			—			20,795
Other non-current liabilities	1,567			305			9,035			—			10,907
Total non-current liabilities	826,691			691			23,005			(19,534		)	830,853
Stockholders’ equity (deficit)	237,131			(141,252		)	(112,630		)	253,882			237,131
Total liabilities and stockholders’ equity	$	1,712,865		$	491,548		$	100,741		$	(1,130,139	)	$	1,175,015

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Globalstar, Inc.

Condensed Consolidating Statement of Cash Flows

Six Months Ended June 30, 2016

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations		Consolidated
	(In thousands)
Cash flows provided by (used in) operating activities	$	916		$	255		$	(170	)	$	—	$	1,001
Cash flows used in investing activities:
Second-generation network costs (including interest)	(5,161		)	—			(146		)	—		(5,307		)
Property and equipment additions	(5,937		)	(167		)	(241		)	—		(6,345		)
Purchase of intangible assets	(806		)	—			—			—		(806		)
Net cash used in investing activities	(11,904		)	(167		)	(387		)	—		(12,458		)
Cash flows provided by (used in) financing activities:
Principal payments of the Facility Agreement	(16,418		)	—			—			—		(16,418		)
Proceeds from issuance of stock to Terrapin	28,500			—			—			—		28,500
Proceeds from issuance of common stock and exercise of options and warrants	3,016			—			—			—		3,016
Net cash provided by financing activities	15,098			—			—			—		15,098
Effect of exchange rate changes on cash	—			—			152			—		152
Net increase (decrease) in cash and cash equivalents	4,110			88			(405		)	—		3,793
Cash and cash equivalents, beginning of period	3,530			719			3,227			—		7,476
Cash and cash equivalents, end of period	$	7,640		$	807		$	2,822		$	—	$	11,269

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Globalstar, Inc.

Condensed Consolidating Statement of Cash Flows

Six Months Ended June 30, 2015

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations		Consolidated
	(In thousands)
Cash flows provided by (used in) operating activities	$	(3,451	)	$	1,239		$	950		$	—	$	(1,262	)
Cash flows used in investing activities:
Second-generation network costs (including interest)	(10,344		)	—			—			—		(10,344		)
Property and equipment additions	(636		)	(1,452		)	(237		)	—		(2,325		)
Purchase of intangible assets	(1,343		)									(1,343		)
Net cash used in investing activities	(12,323		)	(1,452		)	(237		)	—		(14,012		)
Cash flows provided by (used in) financing activities:
Principal payments of the Facility Agreement	(3,225		)									(3,225		)
Proceeds from issuance of stock to Terrapin	24,000			—			—			—		24,000
Proceeds from issuance of common stock and exercise of options and warrants	419			—			—			—		419
Net cash provided by financing activities	21,194			—			—			—		21,194
Effect of exchange rate changes on cash	—			—			(170		)	—		(170		)
Net increase (decrease) in cash and cash equivalents	5,420			(213		)	543			—		5,750
Cash and cash equivalents, beginning of period	3,166			672			3,283			—		7,121
Cash and cash equivalents, end of period	$	8,586		$	459		$	3,826		$	—	$	12,871

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Forward-Looking Statements.

Certain statements contained in or incorporated by reference into this Quarterly Report on Form 10-Q (the "Report"), other than purely historical information, including, but not limited to, estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "estimate," "intend," "strategy," "plan," "may," "should," "will," "would," "will be," "will continue," "will likely result," and similar expressions, although not all forward-looking statements contain these identifying words. These forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Forward-looking statements, such as the statements regarding our ability to develop and expand our business (including our ability to monetize our spectrum rights), our anticipated capital spending, our ability to manage costs, our ability to exploit and respond to technological innovation, the effects of laws and regulations (including tax laws and regulations) and legal and regulatory changes (including regulation related to the use of our spectrum), the opportunities for strategic business combinations and the effects of consolidation in our industry on us and our competitors, our anticipated future revenues, our anticipated financial resources, our expectations about the future operational performance of our satellites (including their projected operational lives), the expected strength of and growth prospects for our existing customers and the markets that we serve, commercial acceptance of new products, problems relating to the ground-based facilities operated by us or by independent gateway operators, worldwide economic, geopolitical and business conditions and risks associated with doing business on a global basis and other statements contained in this Report regarding matters that are not historical facts, involve predictions. Risks and uncertainties that could cause or contribute to such differences include, without limitation, those in Item 1A. Risk Factors in our Annual Report on Form 10-K for the fiscal year ended December 31, 2015, as filed with the Securities and Exchange Commission (the "SEC") on February 26, 2016 (the "2015 Annual Report") and in Item 1A.Risk Factors of Part II in this Report. We do not intend, and undertake no obligation, to update any of our forward-looking statements after the date of this Report to reflect actual results or future events or circumstances. 

New risk factors emerge from time to time, and it is not possible for us to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. We undertake no obligation to update publicly or revise any forward-looking statements. You should not rely upon forward-looking statements as predictions of future events or performance. We cannot assure you that the events and circumstances reflected in the forward-looking statements will be achieved or occur. These cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf. 

This "Management's Discussion and Analysis of Financial Condition" should be read in conjunction with the "Management's Discussion and Analysis of Financial Condition" and information included in our 2015 Annual Report. 

Overview 

Mobile Satellite Services Business

Globalstar, Inc. (“we,” “us” or the “Company”) provides Mobile Satellite Services (“MSS”) including voice and data communications services globally via satellite. By providing wireless communications services in areas not served or underserved by terrestrial wireless and wireline networks and in circumstances where terrestrial networks are not operational due to natural or man-made disasters, we seek to meet our customers' increasing desire for connectivity. We offer voice and data communication services over our network of in-orbit satellites and our active ground stations (or “gateways”), which we refer to collectively as the Globalstar System.

We currently provide the following communications services via satellite. These services are available only with equipment designed to work on our network: 

• two-way voice communication and data transmissions (“Duplex”) using mobile or fixed devices; and

• one-way data transmissions ("Simplex") using a mobile or fixed device that transmits its location and other information to a central monitoring station, which includes certain SPOT and Simplex products.

We have integrated our second-generation satellites with our first-generation satellites to form our second-generation constellation of Low Earth Orbit (“LEO”) satellites. The restoration of our constellation’s Duplex capabilities was complete in August 2013 forming the world's most modern satellite network. This restoration of Duplex capabilities resulted in a substantial increase in service levels, making our products and services more desirable to existing and potential customers. We offer a range

30

of price-competitive products to the industrial, governmental and consumer markets. Due to the unique design of the Globalstar System (and based on customer input), we believe that we offer the best voice quality among our peer group.

We designed our second-generation satellites to last twice as long in space, have 40% greater capacity and be built at a significantly lower cost compared to our first-generation satellites. We achieved this longer life by increasing the solar array and battery capacity, using a larger fuel tank, adding redundancy for key satellite equipment, and improving radiation specifications and additional lot level testing for all susceptible electronic components, in order to account for the accumulated dosage of radiation encountered during a 15-year mission at the operational altitude of the satellites. The second-generation satellites use passive S-band antennas on the body of the spacecraft providing additional shielding for the active amplifiers which are located inside the spacecraft, unlike the first-generation amplifiers that were located on the outside as part of the active antenna array. Each satellite has a high degree of on-board subsystem redundancy, an on-board fault detection system and isolation and recovery for safe and quick risk mitigation.

We define a successful level of service for our customers as their ability to make uninterrupted calls of average duration for a system-wide average number of minutes per month. Our goal is to provide service levels and call success rates equal to or better than our MSS competitors so our products and services are attractive to potential customers. We define voice quality as the ability to easily hear, recognize and understand callers with imperceptible delay in the transmission. Due to the unique design of the Globalstar System, by this measure our system outperforms geostationary (“GEO”) satellites used by some of our competitors. Due to the difference in signal travel distance, GEO satellite signals must travel approximately 42,000 additional nautical miles, which introduces considerable delay and signal degradation to GEO calls. For our competitors using cross-linked satellite architectures, which require multiple inter-satellite connections to complete a call, signal degradation and delay can result in compromised call quality as compared to that experienced over the Globalstar System. 

We also compete aggressively on price. Our MSS handsets are priced lower than those of our main MSS competitors, providing access to MSS services to a broader range of subscribers. We expect to retain our position as the low cost, high quality leader in the MSS industry.  

Our satellite communications business, by providing critical mobile communications to our subscribers, serves principally the following markets: recreation and personal; government; public safety and disaster relief; oil and gas; maritime and fishing; natural resources, mining and forestry; construction; utilities; and transportation. 

Our products and services are sold through a variety of independent agents, dealers and resellers, and IGOs. We have distribution relationships with a number of "Big Box" and online retailers and other similar distribution channels which expands the diversification of our distribution channels. 

At June 30, 2016, we served approximately 693,000 subscribers, which increased 3% from June 30, 2015. We count "subscribers" based on the number of devices that are subject to agreements which entitle them to use our voice or data communications services rather than the number of persons or entities who own or lease those devices. With the release of new product and service offerings and expansion in new and legacy markets, we anticipate further growth in our subscriber base.

Regulatory Reform for Terrestrial Spectrum Authority

In November 2013, the Federal Communications Commission (the "FCC") proposed rules which, if adopted, would enable us to offer low power terrestrial broadband services over a portion of our licensed MSS spectrum.  We have termed these services Terrestrial Low Power Service ("TLPS"). We believe TLPS represents a differentiated, premium, and immediate solution to existing Wi-Fi congestion. Through the two TLPS deployments held during 2015, we demonstrated a material increase in user throughput and network levels. These deployments also provided additional data confirming the successful coexistence of TLPS with other existing services. With these real world deployments of our TLPS operations, we have shown the FCC the dramatic consumer benefits that are achievable. The proposed rules would substantially revise the gating criteria for terrestrial use of our spectrum and would allow us to provide TLPS over our licensed spectrum together with the non-exclusive use of adjacent unlicensed spectrum. On May 13, 2016, the FCC circulated an order containing the proposed rules. If the FCC adopts the proposed order, we plan to establish one or more partnerships to deploy commercial service promptly as well as to seek similar terrestrial authority in certain international jurisdictions.

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Performance Indicators

Our management reviews and analyzes several key performance indicators in order to manage our business and assess the quality of and potential variability of our earnings and cash flows. These key performance indicators include: 

• total revenue, which is an indicator of our overall business growth;

• subscriber growth and churn rate, which are both indicators of the satisfaction of our customers;

• average monthly revenue per user, or ARPU, which is an indicator of our pricing and ability to obtain effectively long-term, high-value customers. We calculate ARPU separately for each type of our Duplex, Simplex, SPOT and IGO revenue;

• operating income and adjusted EBITDA, both of which are indicators of our financial performance; and

• capital expenditures, which are an indicator of future revenue growth potential and cash requirements.

Comparison of the Results of Operations for the three and six months ended June 30, 2016 and 2015

Revenue

Total revenue increased by $2.1 million, or approximately 9%, to $25.1 million for the three months ended June 30, 2016 from $23.0 million for the three months ended June 30, 2015. This increase was driven by a $2.4 millionincrease in service revenue resulting from a 4%increase in our average subscriber base and increases in ARPU for all types of revenue. This increase in service revenue was offset partially by a $0.3 milliondecrease in revenue from subscriber equipment sales. This decrease was due primarily to a lower volume of Duplex and Simplex units sold, offset partially by a higher volume of SPOT equipment sales during the second quarter of 2016 compared to the second quarter of 2015. Additionally, revenue recognized during the three months ended June 30, 2016 was reduced by an additional $0.2 million, compared to the prior year's second quarter, due to appreciation of the U.S. dollar.

Total revenue increased by $2.9 million, or approximately 7%, to $46.9 million for the six months ended June 30, 2016 from $44.0 million for the six months ended June 30, 2015. This increase was driven by a $4.0 millionincrease in service revenue resulting from a 5%increase in our average subscriber base and increases in ARPU for all types of revenue. This increase in service revenue was offset partially by a $1.1 milliondecrease in revenue from subscriber equipment sales. This decrease was due primarily to a lower volume of Duplex and Simplex units sold, offset partially by a higher volume of SPOT equipment sales, during the second quarter of 2016 compared to the second quarter of 2015. Additionally, revenue recognized during the six months ended June 30, 2016 was reduced by an additional $0.7 million, compared to the prior year period, due to appreciation of the U.S. dollar.

The following table sets forth amounts and percentages of our revenue by type of service (dollars in thousands).

	Three Months Ended   June 30, 2016				Three Months Ended   June 30, 2015				Six Months Ended   June 30, 2016				Six Months Ended   June 30, 2015
	Revenue		% of Total Revenue		Revenue		% of Total Revenue		Revenue		% of Total Revenue		Revenue		% of Total Revenue
Service revenue:
Duplex	$	8,093	32	%	$	6,998	30	%	$	14,427	31	%	$	13,163	30	%
SPOT	9,489		38		8,345		36		18,590		39		15,861		36
Simplex	2,644		11		2,249		10		5,009		11		4,535		10
IGO	172		1		163		1		416		1		387		1
Other	572		2		861		4		1,277		3		1,777		5
Total	$	20,970	84	%	$	18,616	81	%	$	39,719	85	%	$	35,723	82	%

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The following table sets forth amounts and percentages of our revenue generated from equipment sales (dollars in thousands).

	Three Months Ended   June 30, 2016					Three Months Ended   June 30, 2015				Six Months Ended   June 30, 2016				Six Months Ended   June 30, 2015
	Revenue			% of Total Revenue		Revenue		% of Total Revenue		Revenue		% of Total Revenue		Revenue		% of Total Revenue
Subscriber equipment sales:
Duplex	$	1,171		4	%	$	1,316	6	%	$	2,019	4	%	$	2,825	6	%
SPOT	1,654			7		1,469		6		2,615		6		2,527		6
Simplex	1,072			4		1,209		5		2,006		4		2,396		5
IGO	229			1		351		2		531		1		473		1
Other	(10		)	—		62		—		32		—		101		—
Total	$	4,116		16	%	$	4,407	19	%	$	7,203	15	%	$	8,322	18	%

The following table sets forth our average number of subscribers and ARPU by type of revenue.

	Three Months Ended   June 30,				Six Months Ended   June 30,
	2016		2015		2016		2015
Average number of subscribers for the period:
Duplex	77,479		72,334		77,154		71,188
SPOT	272,698		251,092		271,073		247,961
Simplex	297,945		292,873		300,529		292,357
IGO	39,091		38,752		39,127		38,686
Other	2,662		5,756		2,703		5,776
Total	689,875		660,807		690,586		655,968
ARPU (monthly):
Duplex	$	34.82	$	32.25	$	31.16	$	30.82
SPOT	11.60		11.08		11.43		10.66
Simplex	2.96		2.56		2.78		2.59
IGO	1.46		1.40		1.77		1.67

The numbers reported in the above table are subject to immaterial rounding inherent in calculating averages.   

Other service revenue includes revenue generated primarily from engineering services and third party sources, which are not subscriber driven. Accordingly, we do not present ARPU for other service revenue in the table above. Effective April 1, 2016, we began classifying activation fees with the service revenue to which they relate.

Service Revenue

Duplex service revenue increased approximately 16% and 10% for the three and six months ended June 30, 2016, respectively, due to increases in both the average subscriber base and ARPU compared to the same periods in 2015. The average Duplex subscriber base increased 7% and 8% and ARPU increased 8% and 1% for the three and six months ended June 30, 2016, respectively, compared to the same periods in 2015. Higher ARPU was due primarily to increases in our legacy rate plans across a portion of our existing subscriber base, as well as higher revenue from annual, usage-based plans. Over the past several quarters, the popularity of our annual, usage-based plans has substantially increased. These plans result in higher service revenue recognized in seasonally stronger months due to increased usage and expiration of unused minutes on the anniversary date of the customer's contract. These increases were offset partially by the appreciation of the U.S. dollar. Due to our global footprint, a significant portion of our sales are generated internationally. For the three and six months ended June 30, 2016 compared to the same periods in 2015, the movement of foreign exchange rates decreased Duplex service revenue by $0.2 million and $0.5 million, respectively.

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SPOT service revenue increased14% and 17% for the three and six months ended June 30, 2016, compared to the same periods in 2015.  For the three and six months ended June 30, 2016, SPOT ARPU increased 5% and 7%, respectively, driven primarily by the significant number of SPOT Gen3^TM sales over the past 12 months. We sell SPOT Gen3^TM with a higher annual rate plan compared to other SPOT products due to its enhanced tracking features. Average SPOT subscribers increased 9% for the three and six months ended June 30, 2016, compared to the same periods in 2015.

Simplex service revenue increased18% and 10% for the three and six months ended June 30, 2016, compared to the same periods in 2015, due to increases in both the average subscriber base and ARPU. Average Simplex subscribers increased 2% and 3% for the three and six months ended June 30, 2016, respectively, compared to the same periods in 2015. The increase in average subscribers is due primarily to activations of units sold during the preceding months, offset partially by higher churn levels due to the impact that the decline in the oil and gas industry has had on our customers that operate in that sector. ARPU increased 16% and 7% for the three and six months ended June 30, 2016, respectively, compared to the same periods in 2015. The increase in ARPU is attributable primarily to a reclassification of activation fees from other revenue to Simplex service revenue, which contributed $0.2 million to the Simplex service revenue variance during the second quarter of 2016.

Other revenue decreased approximately $0.3 million, or 34%, and $0.5 million, or 28%, for the three and six months ended June 30, 2016, compared to the same periods in 2015. The decrease in other revenue is due primarily to a reclassification of activation fees from other revenue to Simplex and Duplex service revenue during the second quarter of 2016, which contributed $0.2 million to the total decrease. This decrease was offset partially by an increase in revenue generated from engineering service contracts.

Subscriber Equipment Sales

Revenue from Duplex equipment sales decreased by approximately 11% and 29% for the three and six months ended June 30, 2016 compared to the same periods in 2015. A higher sales volume of Duplex handsets during the three months ended June 30, 2015 was attributable to increased sales following the introduction of a new sales promotion in March 2015. The decrease in equipment sales revenue during the six month periods was also impacted by the reduction in the selling price of our phones as part of this promotion.

Revenue from SPOT equipment sales increased by approximately 13% and 3% for the three and six months ended June 30, 2016 compared to the same periods in 2015 due to an increase in the volume of units sold during the respective periods.

Revenue from Simplex equipment sales decreased by approximately 11% and 16% for the three and six months ended June 30, 2016 compared to the same periods in 2015. The recent downturn in the oil and gas industry has negatively impacted our Simplex business due to the concentration of Simplex customers who operate in this industry.

Operating Expenses

Total operating expenses increased$1.1 million, or approximately 3%, to $41.5 million for the three months ended June 30, 2016 from $40.4 million for the same period in 2015, due primarily to higher marketing, general and administrative costs, which increased approximately $1.3 million, or 13%. Total operating expenses increased$0.4 million, or approximately 1%, to $79.0 million for the six months ended June 30, 2016, from $78.6 million for the same period in 2015 due primarily to higher marketing, general and administrative costs, which increased approximately $1.3 million or 7%, offset partially by lower cost of subscriber equipment sales, which decreased approximately $1.0 million, or 16%. 

Cost of Services

Cost of services decreased$0.1 million, or approximately 1%, to $7.9 million for the three months ended June 30, 2016 from $8.0 million for the same period in 2015 due primarily to lower gateway maintenance expenses, offset partially by higher research and development costs related to new products. Cost of services were essentially flat for the six months ended June 30, 2016 compared to the same period in 2015 due primarily to an increase in research and development costs related to new products being offset by higher capitalized salaries associated with the upgrades to our ground infrastructure.

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Cost of Subscriber Equipment Sales

Cost of subscriber equipment sales decreased$0.1 million, or approximately 3%, to $2.9 million for the three months ended June 30, 2016 from $3.0 million for the same period in 2015. Cost of subscriber equipment sales decreased$1.0 million, or approximately 16%, to $5.1 million for the six months ended June 30, 2016 from $6.1 million for the same period in 2015. The decrease in cost of subscriber equipment sales is in line with the decrease in revenue from subscriber equipment sales over the same periods. Slight variations in the consolidated equipment margins are due to changes in the volume and mix of products sold during the respective periods.

Marketing, General and Administrative

Marketing, general and administrative expenses increased approximately $1.3 million for both the three and six months ended June 30, 2016 compared to the same periods in 2015, due primarily to a $1.1 million increase in the accrual for the settlement of litigation related to one of our international operations. This settlement, which is expected to occur in the third quarter of 2016, will be paid through the issuance of shares of our common stock. Also contributing to the increase in marketing, general and administrative expenses were higher professional fees, stock compensation costs and subscriber acquisition costs, which increased $0.2 million, $0.4 million and $0.2 million, respectively, when comparing the three month periods and $0.6 million, $0.4 million and $0.4 million, respectively, when comparing the six month periods. These increases were offset partially by reductions in bad debt expense of $0.8 million and $1.5 million during the three and six month periods, respectively, which were driven primarily by an accounts receivable balance that was reserved during the second quarter of 2015 and was recovered during the first quarter of 2016. The remaining variance was driven by individually immaterial items.

Depreciation, Amortization and Accretion

Depreciation, amortization, and accretion expense decreased$0.1 million, or approximately 1%, to $19.2 million for the three months ended June 30, 2016 from $19.3 million for the same period in 2015 and increased$0.1 million to $38.4 million for the six months ended June 30, 2016 from $38.3 million for the same period in 2015.

As of June 30, 2016, we had $190.3 million in construction in progress related to costs (including capitalized interest) associated with our contracts with Hughes and Ericsson to complete next-generation upgrades to our ground infrastructure. We expect to begin depreciating this asset in the near future.

Other Income (Expense)

Loss on Extinguishment of Debt

We incurred losses on extinguishment of debt of $2.2 million and $2.3 million for the three and six months ended June 30, 2015, respectively, due to the conversion of a portion of our 2013 8.00% Notes. During the second quarter of 2015, holders of $6.3 million principal amount of our 2013 8.00% Notes converted their Notes to common stock, resulting in a loss on extinguishment of debt of $2.2 million on the issuance of 10.4 million shares of voting common stock. During the first quarter of 2015, holders of $0.2 million principal amount of our 2013 8.00% Notes converted their Notes, resulting in a loss on extinguishment of debt of less than $0.1 million on the issuance of 0.5 million shares of voting common stock. These losses resulted from the fair value of shares issued to the holders upon conversion exceeding the carrying value of the debt and derivative liability written off due to these conversions.

Loss on Equity Issuance

For the three and six months ended June 30, 2016, loss on equity issuance decreased to $2.1 million and $1.9 million, respectively, from $2.9 million for the three and six months ended June 30, 2015. In June 2015, Hughes exercised its right to receive a pre-payment of certain payment milestones in shares of our common stock at a 7% discount to market value in lieu of cash. As previously discussed in Note 7: Commitments Contractual Obligations - Next-Generation Gateways and Other Ground Facilities, in valuing the shares issued to Hughes at the 7% discount and the related liability for the potential issuance of additional shares, we recorded a non-cash loss of approximately $2.9 million in loss on equity issuance in our condensed consolidated statements of operations for the second quarter of 2015. In conjunction with this agreement, we also provided Hughes downside protection through September 30, 2016. This agreement generally would require us to issue additional shares to Hughes if the market value of our common stock at the end of the downside protection period is less than the price at issuance. We mark this liability to market at each balance sheet date through the settlement date.

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Interest Income and Expense

Interest income and expense, net, increased$0.2 million to an expense of $9.0 million for the three months ended June 30, 2016 from an expense of $9.2 million for the same period in 2015. The decrease was due primarily to a $0.6 million make-whole interest payment related to the conversion of 2013 8% Notes during the second quarter of 2015, which did not recur during the three months ended June 30, 2016. The variance attributable to this make-whole interest payment was offset partially by an increase in interest costs due to a higher interest rate on our Facility Agreement, which floats based on LIBOR. Higher capitalized interest partially offset the impact of this rate increase.

Interest income and expense, net, increased$0.4 million to an expense of $18.2 million for the six months ended June 30, 2016 from an expense of $17.8 million for the same period in 2015. An increase in interest costs due to a higher LIBOR-based interest rate on our Facility Agreement and a higher principal balance outstanding on our Thermo Loan Agreement was offset partially by higher capitalized interest during 2016 and a make-whole interest payment made in the second quarter of 2015, which did not recur in 2016.

Derivative Gain

Derivative gain decreased by $196.6 million to $40.5 million for the three months ended June 30, 2016, compared to $237.1 million for the same period in 2015 and by $90.0 million to $39.2 million for the six months ended June 30, 2016, compared to $129.2 million for the same period in 2015. 

We recognize gains or losses due to the change in the value of certain embedded features within our debt instruments that require standalone derivative accounting. Fluctuation in our stock price is the most significant cause for the change in value of these derivative instruments. Although our stock price did not fluctuate significantly during the first quarter of 2016, it did fluctuate significantly during the second quarter of 2016. Our stock price fluctuated even more significantly during the three and six month periods ended June 30, 2015, resulting in the material non-cash derivative gains in those periods. See Note 5: Fair Value Measurements to our condensed consolidated financial statements for further discussion of the fair value computations of our derivatives.

Other

Other income (loss) fluctuated $1.2 million to income of $0.7 million for the three months ended June 30, 2016 from expense of $0.5 million for the same period in 2015.  Other income (loss) fluctuated $3.8 million to expense of $0.1 million for the six months ended June 30, 2016 from income of $3.7 million for the same period in 2015.  This fluctuation is due primarily to foreign currency gains and losses recognized during the respective periods given the significant financial statement items we have denominated in foreign currencies, including primarily the Brazilian real, euro and Canadian dollar. Additionally, in March 2016, the Venezuelan government introduced the DICOM rate, which is published by the Central Bank of Venezuela and replaced the SIMADI rate. We use the DICOM exchange rate to remeasure our Venezuelan subsidiary's bolivar-based transactions and net monetary assets in U.S. dollars.

Liquidity and Capital Resources

Overview

Our principal liquidity requirements include paying our debt service obligations, funding our operating costs and paying amounts related to our capital projects. Our principal sources of liquidity include cash on hand, cash flows from operations and funds available under our common stock purchase agreement with Terrapin. We also expect sources of liquidity to include funds from other debt or equity financings that have not yet been arranged. See Part I, Item 1A. Risk Factors in our 2015 Annual Report for a description of risks, some of which are beyond our control, affecting our ability to fulfill our liquidity requirements.

As of June 30, 2016, we held cash and cash equivalents of $11.3 million. We also had $37.9 million in restricted cash, which is the balance in our debt service reserve account. The Facility Agreement (as defined below) requires us to maintain $37.9 million in a debt service reserve account and restricts the use of these funds to making principal and interest payments under the Facility Agreement. In August 2015, we entered into a new $75.0 million common stock purchase agreement with Terrapin (the "August 2015 Terrapin Agreement"), which is available to be drawn over a 24-month period. As of June 30, 2016, $31.5 million remained available under this agreement. We anticipate that we will draw the remaining amounts available under the August 2015 Terrapin Agreement to achieve compliance with certain financial covenants in our Facility Agreement.

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As of December 31, 2015, we held cash and cash equivalents of $7.5 million and $60.0 million was available under the August 2015 Terrapin Agreement.

The carrying amount of our current and long-term debt outstanding was $38.1 million and $540.4 million, respectively, at June 30, 2016, compared to $32.8 million and $548.3 million, respectively, at December 31, 2015. The current portion of our long-term debt outstanding at these dates represents principal payments under our Facility Agreement scheduled to occur within 12 months. The decrease in our total debt balance was due primarily to a principal payment on our Facility Agreement, offset partially by a higher carrying value of the Thermo Loan Agreement due to interest accruing on that debt and amortization and accretion of the debt discounts and debt financing costs related to our Facility Agreement and convertible notes.

Indebtedness and Available Credit 

Facility Agreement

On August 7, 2015, we entered into a Second Global Amendment and Restatement Agreement (the "2015 GARA") providing for the amendment and restatement of our former senior credit facility and certain related credit documents (this amended and restated senior secured credit facility agreement is herein referred to as the "Facility Agreement"). The indebtedness under the Facility Agreement is scheduled to mature in December 2022. As of June 30, 2016, we had fully drawn all funds available under the Facility Agreement, and the principal amount outstanding was $559.4 million. Semi-annual principal repayments began in December 2014.

The Facility Agreement contains customary events of default and requires that we satisfy various financial and non-financial covenants. Pursuant to the terms of the Facility Agreement, we may cure noncompliance with certain financial covenants through Equity Cure Contributions (as described below) through a date as late as June 2019. If we were to violate any of these covenants and were unable to obtain a sufficient Equity Cure Contribution or a waiver, we would be in default under the Facility Agreement, and the lenders could accelerate payment of the indebtedness. The acceleration of our indebtedness under one agreement may permit acceleration of indebtedness under other agreements that contain cross-acceleration provisions. As of June 30, 2016, we were in compliance with respect to the covenants of the Facility Agreement.

The compliance calculations of the financial covenants of the Facility Agreement permit inclusion of certain cash funds contributed to us from the issuance of our common stock and/or subordinated indebtedness. We refer to these funds as "Equity Cure Contributions," and we may obtain them to achieve compliance with financial covenants, subject to the conditions set forth in the Facility Agreement. Each Equity Cure Contribution must be in a minimum amount of $10 million for each measurement period or in the aggregate for all periods until the date that such funding is no longer allowed by the Facility Agreement. In August 2015, February 2016 and June 2016, we drew $15 million, $6.5 million and $22 million, respectively, under the August 2015 Terrapin Agreement. We used these funds as Equity Cure Contributions under the Facility Agreement in the calculation of our compliance with financial covenants for the measurement periods ended December 31, 2015 and June 30, 2016.

The Facility Agreement requires that we maintain a total of $37.9 million in a debt service reserve account that is pledged to secure all of our obligations under the Facility Agreement. We may use these funds only to make principal and interest payments under the Facility Agreement. As of June 30, 2016, the balance in the debt service reserve account, which was established with the proceeds of the loan agreement with Thermo discussed below, was $37.9 million and classified as restricted cash on our condensed consolidated balance sheets.

The Facility Agreement bears interest at a floating rate of LIBOR plus 2.75% through June 2017, increasing by an additional 0.5% each year thereafter to a maximum rate of LIBOR plus 5.75%. Ninety-five percent of our obligations under the Facility Agreement are guaranteed by COFACE, the French export credit agency. Our obligations under the Facility Agreement are guaranteed on a senior secured basis by all of our domestic subsidiaries and are secured by a first priority lien on substantially all of our assets and our domestic subsidiaries (other than their FCC licenses), including patents and trademarks, 100% of the equity of our domestic subsidiaries and 65% of the equity of certain foreign subsidiaries. 

See discussion in Note 3: Long-Term Debt and Other Financing Arrangements in our condensed consolidated financial statements for further discussion of the Facility Agreement.

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Thermo Loan Agreement

We also have an amended and restated loan agreement with Thermo (the “Loan Agreement”). Our obligations to Thermo under the Loan Agreement are subordinated to all of our obligations under the Facility Agreement.  Amounts outstanding under the Loan Agreement accrue interest at 12% per annum, which we capitalize and add to the outstanding principal in lieu of cash payments. We will make payments to Thermo only when permitted by the Facility Agreement. Principal and interest under the Loan Agreement become due and payable six months after the obligations under the Facility Agreement have been paid in full, or earlier if a change in control or any acceleration of the maturity of the loans under the Facility Agreement occurs. As of June 30, 2016, the principal amount outstanding was $88.4 million, including $44.9 million of interest that had accrued since 2009 with respect to the Thermo Loan Agreement.

In connection with the 2015 GARA, Thermo and certain of its affiliates executed and delivered to the agent under the Facility Agreement the Second Thermo Group Undertaking Letter in which they agreed that, during the period commencing on the effective date of the 2015 GARA and ending on the later of March 31, 2018 and, if our 2013 8.00% Notes have been redeemed in full, September 30, 2019, they would make, or cause to be made, available to us cash equity financing in the aggregate amount of $30.0 million. Thermo was obligated to provide these funds if we requested the funds or an event of default occurred under the Facility Agreement, and Terrapin failed to purchase shares of our voting common stock to provide us with cash proceeds requested under the August 2015 Terrapin Agreement. The balance of this commitment was reduced by any cash equity financing that we received during the Commitment Period from Thermo or an external equity funding source, including Terrapin, and which we used as an Equity Cure Contribution. In August 2015, February 2016 and June 2016, we drew $15 million, $6.5 million and $22 million, respectively, under the August 2015 Terrapin Agreement. As a result, Thermo had no remaining cash equity commitment as of June 30, 2016 under this letter. All of the transactions between us and Thermo and its affiliates were reviewed and approved on our behalf by a Special Committee of our independent directors, who were represented by independent counsel.

See discussion in Note 3: Long-Term Debt and Other Financing Arrangements in our condensed consolidated financial statements for further discussion of the Second Thermo Group Undertaking Letter, the Equity Agreement, and the Thermo Loan Agreement.

8.00% Convertible Senior Notes Issued in 2013

Our 2013 8.00% Notes initially were convertible into shares of our common stock at a conversion price of $0.80 per share of common stock, or 1,250 shares of our common stock per $1,000 principal amount of 2013 8.00% Notes, subject to adjustment. Due to common stock issuances by us since May 20, 2013 at prices below the then effective conversion rate, the base conversion rate was $0.73 per share of common stock as of June 30, 2016. 

As of June 30, 2016, the principal amount outstanding of the 2013 8.00% Notes was $16.9 million. Interest on the 2013 8.00% Notes is payable semi-annually in arrears on April 1 and October 1 of each year. We pay interest in cash at a rate of 5.75% per annum and by issuing additional 2013 8.00% Notes at a rate of 2.25% per annum.

A holder of 2013 8.00% Notes has the right, at the holder’s option, to require us to purchase some or all of the 2013 8.00% Notes on each of April 1, 2018 and April 1, 2023 at a price equal to the principal amount of the 2013 8.00% Notes to be purchased plus accrued and unpaid interest. 

The indenture governing the 2013 8.00% Notes provides for customary events of default. If there is an event of default, the Trustee may, at the direction of the holders of 25% or more in aggregate principal amount of the 2013 8.00% Notes, accelerate the maturity of the 2013 8.00% Notes. As of June 30, 2016, we were not in default under the indenture governing the 2013 8.00% Notes. 

See Note 3: Long-Term Debt and Other Financing Arrangements in our Consolidated Financial Statements in Part II, Item 8 of our 2015 Annual Report for a complete description of our 2013 8.00% Notes.  

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Terrapin Opportunity, L.P. Common Stock Purchase Agreement

In conjunction with the amendment to the Facility Agreement in August 2015 (as discussed above), we entered into the August 2015 Terrapin Agreement pursuant to which we may require Terrapin to purchase up to $75.0 million of shares of voting common stock over the 24-month term following the date of the agreement. Over the 24-month term, in our discretion, we may present Terrapin with up to 24 draw notices requiring Terrapin to purchase a specified dollar amount of shares of our voting common stock, based on the price per share per day over ten consecutive trading days (a "Draw Down Period"). The per share purchase price for these shares will equal the daily volume weighted average price of common stock on each date during the Draw Down Period on which shares are purchased by Terrapin (but not less than a minimum price specified by us (a “Threshold Price”)), less a discount ranging from 2.75% to 4.00% based on the amount of the Threshold Price. In addition, in our discretion, but subject to certain limitations, we may grant to Terrapin the option to purchase additional shares during the Draw Down Period. We have agreed not to sell to Terrapin a number of shares of voting common stock that, when aggregated with all other shares of voting common stock then beneficially owned by Terrapin and its affiliates, would result in their beneficial ownership of more than 9.9% of the number of our shares of voting common stock issued and outstanding at the date of the sale.

In August 2015, we drew $15.0 million under the August 2015 Terrapin Agreement and issued 9.3 million shares of voting common stock to Terrapin at an average price of $1.61 per share. In February 2016, we drew $6.5 million under the August 2015 Terrapin Agreement and issued 6.4 million shares of voting common stock to Terrapin at an average price of $1.02 per share. In June 2016, we drew $22.0 million under the August 2015 Terrapin Agreement and issued 19.5 million shares of voting common stock to Terrapin at an average price of $1.13 per share. At June 30, 2016, $31.5 million remained available under the August 2015 Terrapin Agreement. We expect to make draws from time to time under the August 2015 Terrapin Agreement to be used as Equity Cure Contributions under the Facility Agreement or for general corporate purposes.

Capital Expenditures 

For the six months ended June 30, 2016, our capital expenditures, excluding interest, totaled approximately $9.4 million, of which $1.6 million were under our contractual agreements with Ericsson and Hughes related to the procurement and deployment of our second-generation gateways and other ground facilities and related products. As of June 30, 2016, the remaining estimated payment amounts of our contractual capital expenditures under our agreements with Ericsson and Hughes are $6.0 million and $0.8 million, respectively.

In addition to the contractual agreements mentioned above, we have a contract with Thales for the construction of the second-generation low-earth orbit satellites and related services. We successfully completed the launches of our second-generation satellites. We are engaged in ongoing discussions with Thales regarding certain deliverables under the contract.

Cash Flows for the six months ended June 30, 2016 and 2015

The following table shows our cash flows from operating, investing and financing activities (in thousands): 

	Six Months Ended
	June 30, 2016			June 30, 2015
Net cash provided by (used in) operating activities	$	1,001		$	(1,262	)
Net cash used in investing activities	(12,458		)	(14,012		)
Net cash provided by financing activities	15,098			21,194
Effect of exchange rate changes on cash	152			(170		)
Net increase in cash and cash equivalents	$	3,793		$	5,750

Cash Flows Provided by Operating Activities

Net cash provided by operating activities during the six months ended June 30, 2016 was $1.0 million compared to net cash used in operating activities of $1.3 million during the same period in 2015. During 2016, we experienced favorable changes in operating assets and liabilities, resulting primarily from favorable fluctuations in accounts receivable and other assets, offset partially by unfavorable fluctuations in accounts payable and accrued expenses.

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Cash Flows Used in Investing Activities 

Net cash used in investing activities was $12.5 million for the six months ended June 30, 2016 compared to $14.0 million for the same period in 2015. We experienced a decrease in cash used in investing activities related to our second-generation network costs as we are approaching the final milestones of our contracts with Hughes and Ericsson. This decrease was offset partially by an increase in other property and equipment additions related to software and other back office expenditures to prepare for the rollout of new products.

Cash Flows Provided by Financing Activities 

Net cash provided by financing activities was $15.1 million for the six months ended June 30, 2016 compared to $21.2 million for the same period in 2015. During the first six months of 2016 and 2015, we received proceeds from the sale of our common stock to Terrapin of $28.5 million and $24.0 million, respectively. In addition, we received cash of $2.6 million from Thermo related to warrants exercised in June 2016. The cash provided by financing activities was offset partially by principal payments under our Facility Agreement in June 2016 and 2015 in the amounts of $16.4 million and $3.2 million, respectively.

Contractual Obligations and Commitments

There have been no significant changes to our contractual obligations and commitments since December 31, 2015.

Off-Balance Sheet Transactions

We have no material off-balance sheet transactions.

Recently Issued Accounting Pronouncements

For a discussion of recently issued accounting guidance and the expected impact that the guidance could have on our Condensed Consolidated Financial Statements, see Recently Issued Accounting Pronouncements in Note 1: Basis of Presentation in our Condensed Consolidated Financial Statements in Part 1, Item 1 of this Report.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Our services and products are sold, distributed or available in over 120 countries. Our international sales are denominated primarily in Canadian dollars, Brazilian reais and euros. In some cases, insufficient supplies of U.S. currency may require us to accept payment in other foreign currencies. We reduce our currency exchange risk from revenues in currencies other than the U.S. dollar by requiring payment in U.S. dollars whenever possible and purchasing foreign currencies on the spot market when rates are favorable. We currently do not purchase hedging instruments to hedge foreign currencies. We are obligated to enter into currency hedges with the lenders to the Facility Agreement no later than 90 days after any fiscal quarter during which more than 25% of revenues is denominated in a single currency other than U.S. or Canadian dollars. Otherwise, we cannot enter into hedging agreements other than interest rate cap agreements or other hedges described above without the consent of the agent for the Facility Agreement, and with that consent the counterparties may only be the lenders to the Facility Agreement.

We also have operations in Venezuela. Since 2010, the Venezuelan government's frequent modifications to its currency laws have caused the bolivar to devalue significantly and resulted in Venezuela being considered a highly inflationary economy. At the end of each accounting period through June 30, 2015, we remeasured our Venezuelan subsidiary from the bolivar to the U.S. dollar at the official government rate of 6.3 bolivars per U.S. dollar. Effective July 1, 2015 we began using the SIMADI exchange rate published by the Central Bank of Venezuela to remeasure our Venezuelan subsidiary's bolivar based transactions and net monetary assets in U.S. dollars. We determined, based upon our specific facts and circumstances, that the SIMADI rate (renamed the DICOM rate in March 2016) is the most appropriate rate for financial reporting purposes, instead of the official exchange rate we previously used. We continue to monitor the significant uncertainty surrounding current Venezuela exchange mechanisms.

Our interest rate risk arises from our variable rate debt under our Facility Agreement, under which loans bear interest at a floating rate based on the LIBOR. In order to reduce the interest rate risk, we completed an arrangement with the lenders under the Facility Agreement to limit the interest to which we are exposed. The interest rate cap provides limits on the 6-month Libor rate (Base Rate) used to calculate the coupon interest on outstanding amounts on the Facility Agreement to be capped at 5.50% should the Base Rate not exceed 6.5%. Should the Base Rate exceed 6.5%, our Base Rate will be 1% less than the then 6-month LIBOR rate. We have $559.4 million in principal outstanding under the Facility Agreement. A 1.0% change in interest rates would result in a change to interest expense of approximately $5.6 million annually.

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See Note 5: Fair Value Measurements in our Condensed Consolidated Financial Statements for discussion of our financial assets and liabilities measured at fair market value and the market factors affecting changes in fair market value of each.

Item 4. Controls and Procedures.

(a) Evaluation of disclosure controls and procedures.

Our management, with the participation of our Principal Executive Officer and Principal Financial Officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15(b) under the Securities Exchange Act of 1934 as of June 30, 2016, the end of the period covered by this Report. This evaluation was based on the guidelines established in Internal Control - Integrated Framework issued in 2013 by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Based on this evaluation, our Principal Executive Officer and Principal Financial Officer concluded that as of June 30, 2016 our disclosure controls and procedures were effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Principal Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

We believe that the condensed consolidated financial statements included in this Report fairly present, in all material respects, our condensed consolidated financial position and results of operations for the six months ended June 30, 2016.

(b) Changes in internal control over financial reporting.

As of June 30, 2016, our management, with the participation of our Principal Executive Officer and Principal Financial Officer, evaluated our internal control over financial reporting. Based on that evaluation, our Principal Executive Officer and Principal Financial Officer concluded that no changes in our internal control over financial reporting occurred during the quarter ended June 30, 2016 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II: OTHER INFORMATION

Item 1. Legal Proceedings.

For a description of our material pending legal and regulatory proceedings and settlements, see Note 8: Contingencies in our Condensed Consolidated Financial Statements in Part I, Item 1 of this Report.

Item 1A. Risk Factors.

You should carefully consider the risks described in this Report and all of the other reports that we file from time to time with the SEC, in evaluating and understanding us and our business. Additional risks not presently known or that we currently deem immaterial may also impact our business operations and the risks identified in this Report may adversely affect our business in ways we do not currently anticipate. Our financial condition or results of operations also could be materially adversely affected by any of these risks. There have been no material changes to our risk factors disclosed in Part I. Item 1A."Risk Factors" of our 2015 Annual Report other than as set forth below.

The United Kingdom's vote to leave the European Union could adversely impact our business, results of operations and financial condition.

We sell our products and services in the United Kingdom (the “UK”) and throughout Europe. In particular, the United Kingdom is the largest market in Europe for our SPOT product family. On June 23, 2016, the UK voted in an advisory referendum for the UK to leave the European Union (the “EU”). The exit process (commonly referred to as “Brexit”) is expected to take approximately two years, and will involve the negotiation of new trade and other agreements.

Brexit creates legal, regulatory, and economic uncertainty that could have a negative impact on our business. If the UK changes the regulatory structure for telecommunications products, it is possible that we may not be able to comply or compliance will become cost prohibitive. Similarly, post-Brexit trade agreements could impose import taxes or other expenses on our products, which may increase the price of our products sold in the UK.

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We also have currency exchange risk as a result of the Brexit vote. Following the UK vote to leave the EU, the value of the British pound and the euro have declined relative to the U.S. dollar. While most of our sales are denominated in U.S. dollars, we also receive payments in international currencies, including the Pound and the euro. We therefore incur currency translation risk when currency values fluctuate and the U.S. dollar is strong relative to other currencies. Furthermore, a strong U.S. dollar increases the price of our products in international markets, which could reduce demand in those markets for our products.

Although the future impacts of Brexit are unknown at this time, the UK’s vote to leave the EU has created legal, regulatory, and currency risk that may have a materially adverse impact on our business. Furthermore, this uncertainty could negatively impact the economies of other countries in which we operate.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None

Item 3. Defaults upon Senior Securities.

None

Item 4. Mine Safety Disclosures.

Not Applicable

Item 5. Other Information.

None.

Item 6. Exhibits.

Exhibit Number	Description
3.1	Second Amended and Restated Bylaws of Globalstar, Inc.
10.1	Amendment to Letter Agreement regarding equity payment by and between Globalstar, Inc. and Hughes Network Systems, LLC dated as of June 14, 2016
31.1	Section 302 Certification of the Principal Executive Officer
31.2	Section 302 Certification of the Principal Financial Officer
32.1	Section 906 Certification of the Principal Executive Officer
32.2	Section 906 Certification of the Principal Financial Officer
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			GLOBALSTAR, INC.
Date:	August 4, 2016	By:	/s/ James Monroe III
			James Monroe III
			Chairman and Chief Executive Officer (Principal Executive Officer)
			/s/ Rebecca S. Clary
			Rebecca S. Clary
			Chief Financial Officer (Principal Financial Officer)

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EX-3.1

Exhibit 3.1

SECOND AMENDED AND RESTATED

BYLAWS

OF

GLOBALSTAR, INC.

ARTICLE I

OFFICES

Section 1. Registered Office. Globalstar, Inc., a Delaware corporation (the “Corporation”), shall maintain a registered office in the State of Delaware at such location as shall from time to time be determined by the Board of Directors of the Corporation (the “Board”).

Section 2. Other Offices. The Corporation may also have offices at such other locations both within and without the State of Delaware as the Board may from time to time determine.

ARTICLE II

STOCKHOLDERS

Section 1. Annual Meeting. The annual meeting of the stockholders shall be held on the third Tuesday in May in each year at such place (if any) and time as determined by the Board, or on such other date and at such other place and time as determined by the Board, for the purpose of electing directors and conducting such other proper business as may come before the meeting. Written notice of the annual meeting stating the place, date and hour of the meeting shall be given to each stockholder entitled to vote at such meeting not less than twenty (20) nor more than sixty (60) days before the date of the meeting. If mailed such notice shall be deemed to be given when deposited in the United States mail, postage prepaid, directed to the stockholder at such stockholder’s address as it appears on the records of the Corporation.

Section 2. Special Meetings. Unless otherwise provided by law, the Certificate of Incorporation or these Bylaws, special meetings of the stockholders, for any purpose or purposes, may be called only by the Board. Notice of a special meeting stating the place, date and hour of the meeting and the purpose or purposes for which the meeting is called, shall be given not less than ten (10) nor more than sixty (60) days before the date of the meeting to each stockholder entitled to vote at such meeting. Business transacted at any special meeting of the stockholders shall be limited to the purpose(s) stated in the notice.

Section 3. Quorum and Vote Required for Action. The holders of a majority of the capital stock issued and outstanding and entitled to vote at any meeting of the stockholders shall constitute a quorum for the transaction of business except as otherwise provided by law, the Certificate of Incorporation or these Bylaws. If the vote of a class or series is required, the presence of the holders of a majority of the capital stock of such class or series also shall be required to constitute a quorum. If, however, a quorum shall not be present or represented at any meeting of the stockholders, the stockholders entitled to vote at the meeting, present in person or represented by proxy, shall have power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented. At the adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally notified. If the adjournment is for more than thirty (30) days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.

Except as otherwise provided by law, the Certificate of Incorporation or the rules and regulations of any stock exchange applicable to the Corporation, if a quorum is present at any meeting, the vote of the holders of a majority of the capital stock having voting power present in person or represented by proxy at that meeting shall decide any question brought before the meeting. If the vote of a class or series is required on any question, the vote of the holders of a majority of the capital stock of such class or series also shall be required to decide that question.

Section 4. Voting of Shares. Except as provided in the Certificate of Incorporation or by law, at every meeting of the stockholders, each stockholder shall be entitled to one (1) vote in person or by proxy for each share of the capital stock having voting power held by such stockholder, but no proxy may be voted after three (3) years from its date, unless the proxy provides for a longer period. Any proxy shall be in writing and shall be filed with the Secretary of the Corporation before or at the time of the meeting.

Section 5. Action in Lieu of a Meeting. Any action that is required to be or that may be taken at any annual or special meeting of the stockholders of the Corporation may be taken without a meeting if and to the extent permitted by the Certificate of Incorporation.

Section 6. Place of Meetings. Meetings of the stockholders shall be held at such place (if any) within or without of the State of Delaware as is designated by the Board.

Section 7. Stockholders May Participate in Other Activities. Stockholders and their affiliates and directors, either individually or with others, may participate in other business ventures of every kind, whether or not such other business ventures compete with the Corporation. No stockholder, acting in the capacity of a stockholder, shall be obligated to offer to the Corporation or to the other stockholders any opportunity to participate in any other business venture. Neither the Corporation nor the other stockholders shall have any right to any income or profit derived from any other business venture of a stockholder.

Section 8. Record Date. For the purpose of determining stockholders entitled to notice of or to vote at any meeting of the stockholders or any adjournment thereof, or in order to make a determination of stockholders for any other purpose, the Board may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board, and which record date: (a) in the case of determining the stockholders entitled to vote at any meeting of stockholders or adjournment thereof, unless otherwise required by law, shall not be more than sixty (60) nor less than ten (10) days before the date of such meeting;

(b)    in the case of determining the stockholders entitled to express consent to corporate action in writing without a meeting, if action by written consent is then permitted by the Certificate of Incorporation, shall not be more than ten (10) days from the date upon which the resolution fixing the record date is adopted by the Board of Directors; and (c) in the case of any other action, shall not be more than sixty (60) days prior to such other action. If no record date is fixed: (x) the record date for determining the stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held; (y) the record date for determining the stockholders entitled to express consent to corporate action in writing without a meeting, if action by written consent is then permitted by the Certificate of Incorporation, when no prior action of the Board of Directors is required by law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the Corporation in accordance with applicable law, or, if prior action by the Board of Directors is required by law, shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action; and (z) the record date for determining the stockholders for any other purpose shall be at the close of business on the day on which the Board adopts the resolution relating thereto. When a determination of stockholders entitled to vote at any meeting of the stockholders has been made as provided in this Section 2.8, the determination shall apply to any adjournment thereof unless a new record date is fixed by the Board.

Section 9. List of Stockholders. The Secretary shall prepare and make a complete list of the stockholders entitled to vote at any meeting of the stockholders, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours at the principal place of business of the Corporation. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof and may be inspected by any stockholder who is present. The stock ledger shall be the only evidence as to who are the stockholders entitled to examine the stock ledger, the list of stockholders or the books of the Corporation, or to vote in person or by proxy at any meeting of the stockholders.

Section 10. Organization. Meetings of the stockholders shall be presided over by the Chairman of the Board, or in his absence by the Vice Chairman of the Board, if any, or in his absence by the President, or in his absence by a Vice President, or in the absence of the foregoing persons by a chairman designated by the Board, or in the absence of such designation by a chairman chosen at the meeting. The Secretary or any Assistant Secretary shall act as secretary of the meeting, but in his absence the chairman of the meeting may appoint any person to act as secretary of the meeting. The chairman of the meeting shall announce at the meeting the opening and the closing of the polls for each matter upon which the stockholders will vote.

Section 11. Conduct of Meetings. The Board may adopt by resolution such rules and regulations for the conduct of meetings of the stockholders as it shall deem appropriate. Except to the extent inconsistent with such rules and regulations as have been adopted by the Board, the chairman of any meeting of the stockholders shall have the right and authority to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such chairman, are appropriate for the proper conduct of the meeting. Such rules, regulations or procedures, whether adopted by the Board or prescribed by the chairman of the meeting, may include, without limitation, the following: (a) the establishment of an agenda or order of business for the meeting:

(b)    rules and procedures for maintaining order at the meeting and the safety of those present; (c) limitations on attendance at or participation in the meeting to stockholders of record of the corporation, their duly authorized and constituted proxies or such other persons as the chairman of the meeting shall determine; (d) restrictions on entry to the meeting after the time fixed for the commencement thereof; and (e) limitations on the time allotted to questions or comments by participants. Unless and to the extent determined by the Board or the chairman of the meeting, meetings of the stockholders shall not be required to be held in accordance with the rules of parliamentary procedure.

ARTICLE III

BOARD OF DIRECTORS

Section 1. Powers. The business and affairs of the Corporation shall be managed under the direction of the Board, except to the extent that the Board shall delegate its authority, powers and duties to one or more committees of its members.

The Board may exercise all such powers of the Corporation and do all such lawful acts and things as are not by law, the Certificate of Incorporation or these Bylaws directed or required to be exercised, done or approved by the stockholders of the Corporation.

Section 2. Composition, Classes, Election, and Term of Office. The Board shall be comprised of seven (7) directors. The directors shall be divided three (3) classes designated “Class A,” “Class B,” and “Class C” (each a “Class,” and collectively, the “Classes”). Class A and Class B shall have two (2) directors and Class C shall have three (3) directors.

The directors in office on the Effective Date (as defined in Section 9.4) shall divide themselves into the three Classes. The two Class A directors shall hold such office for an initial term expiring at the annual meeting of stockholders to be held in 2007; the two (2) Class B directors shall hold such office for an initial term expiring at the annual meeting of stockholders to be held in 2008; and the three (3) Class C directors shall hold such office for an initial term expiring at the annual meeting of stockholders to be held in 2009. Each director in office on the Effective Date shall continue to hold such office for the term prescribed by the immediately preceding sentence until his or her successor shall have been duly elected and qualified, or until his or her death, resignation, or removal in the manner hereafter provided.

At each annual meeting of stockholders, the stockholders shall vote on the election of directors to fill the positions of the Class of directors whose terms have expired. Each director elected at an annual meeting of stockholders shall hold such office for a term of three (3) years until his or her successor has been duly elected and qualified, or until his or her death, resignation, or removal in the manner hereafter provided. The election of directors shall be by Class, and the directors to be elected to any such Class shall be elected by a plurality of the votes of the stockholders entitled to vote at each meeting for the election of directors in such Class. The terms of each Class of directors shall be staggered such that the expiration of the terms of any two or more Classes of directors shall not occur during the same calendar year.

Any director may resign at any time upon notice to the Corporation. Any newly created directorship or any vacancy occurring in the Board for any cause may be filled only by the remaining directors through less than a majority of the whole authorized number of directors by vote of a majority of those remaining in office, and each director so elected shall hold office until the expiration of the term of office of the director whom he or she has replaced or until his or her successor is elected and qualified. Directors may be removed with or without cause if and to the extent permitted by the Certificate of Incorporation.

Section 3. Chairman of the Board. The Board shall elect a Chairman of the Board. The Chairman shall have such duties, authority and obligations as may be given to him by these Bylaws or by the Board.

Section 4. Meetings. The Board shall meet not less often than quarterly and immediately following the annual meeting of the stockholders. A time and place for regular meetings of the Board may be established by the Board. Meetings of the Board may be held upon call of the Chairman of the Board or any four (4) directors. Members of the Board or any committee designated by the Board may participate in a meeting of the Board or committee by conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at the meeting.

Section 5. Notice of Special Meetings. Notice of any special meeting of the Board shall be given at least three (3) days before the meeting in writing and by mail, facsimile transmission, electronic mail, personal delivery or private carrier, or telephonic means to each director at his or her business address or such other address as he or she may have advised the Secretary of the Corporation to use for such purpose. If hand delivered, notice shall be deemed to be given when delivered to such address or to the director to be notified. If mailed or sent by private carrier, such notice shall be deemed to be given five (5) business days after deposit in the United States mail, postage prepaid, of a letter addressed to the appropriate location. Notice given by telephonic means, electronic transmission or facsimile transmission shall be deemed to be given when actually received by the director to be notified.

Section 6. Quorum. The presence of a majority of the members of the Board then in office (present in person or by telephone) shall constitute a quorum at any meeting of the Board.

Section 7. Voting. Each director shall be entitled to one (1) vote. Except as otherwise provided by law, the Certificate of Incorporation or these Bylaws, the Board shall act by majority vote of those directors present and voting at any duly called meeting at which a quorum is present.

Section 8. Action without a Meeting. Any action which may be authorized or taken at a meeting of the Board may be authorized or taken without a meeting if all of the directors consent thereto in writing or by electronic transmission, and such writing(s) or electronic transmission(s) are filed with the minutes of proceedings of the Board.

Section 9. Organization. Meetings of the Board shall be presided over by the Chairman of the Board, if any, or in his or her absence by the Vice Chairman of the Board, if any, or in their absence by a chairman chosen at the meeting. The Secretary or any Assistant Secretary shall act as secretary of the meeting, but in his or her absence the chairman of the meeting may appoint any person to act as secretary of the meeting.

ARTICLE IV

COMMITTEES OF THE BOARD

Section 1. Number of Committees. The Board may by resolution establish one or more committees of the Board. To the extent permitted by law and provided in the resolution of the Board, any such committee shall have and may exercise all the powers and authority of the Board in the management of the business and affairs of the Corporation. All committees shall report their activities to the Board upon request of the Chairman of the Board or the Corporate Secretary.

Section 2. Appointment; Vacancies; and Removal. The Board shall appoint the members of the committees established in this Article IV to serve for terms expiring at the regular meeting of the Board following the next succeeding annual election meeting, and the Board may, at any time, with or without cause, remove any member of a committee so appointed. Any vacancy occurring in a committee shall be filled by the Board for the remainder of the term.

Section 3. Committee Procedures. Each committee shall determine its own time and manner of conducting its meetings; the presence of a majority of the members of the committee shall constitute a quorum; and the vote of a majority of the members of a committee present at a meeting at which a quorum is present shall be the act of the committee. A committee may act informally by written consent of all of its members.

ARTICLE V

OFFICERS

Section 1. Composition of Officers. The officers of the Corporation shall consist of at least a Chairman of the Board, a President, and a Secretary and may include such other officers as are appointed by the Board, including but not limited to a Chief Executive Officer, one or more Vice Presidents, a Chief Financial Officer, a Treasurer, one or more Assistant Secretaries and one or more Assistant Treasurers. Any two or more offices may be held by the same person, except that the Secretary may not hold the office of President.

Section 2. Tenure and Appointment; Removal. All officers shall be appointed by the Board and shall hold office for one (1) year or until their successors are elected and qualified, or for such other period as the Board may designate. Any officer may be removed by the Board with or without cause.

Section 3. Powers and Duties. Each of the officers of the Corporation shall, unless otherwise ordered by the Board, have such powers and duties as customarily pertain to the respective office, and such further powers and duties as from time to time may be conferred by the Board, or by an officer delegated such authority by the Board.

ARTICLE VI

AMENDMENTS

Bylaws. As set forth in the Certificate of Incorporation, the Board shall have the power to adopt, amend or repeal these Bylaws, from time to time. These Bylaws may also be amended or repealed or new bylaws of the Corporation may be adopted, by the vote of the holders of at least 66 2/3% in voting power of the shares of the Corporation then entitled to vote in the election of the directors. Notwithstanding the foregoing, if Thermo Capital Partners, L.L.C. and its Affiliates (as defined in the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder) (“Thermo”) owns beneficially a majority in voting power of the outstanding shares of the Corporation entitled to vote in the election of the directors, these Bylaws may be amended or repealed by the vote of the holders of a majority in voting power of the shares of the Corporation then entitled to vote in the election of the directors.

ARTICLE VII

CERTIFICATES OF STOCK AND THEIR TRANSFER

Section 1. Certificates. The interest of each stockholder of the Corporation shall be evidenced by certificates for shares of stock in such form as the Board of Directors may from time to time prescribe; provided that the Board of Directors may provide by resolution or resolutions that all or certain classes or series of the stock of the Corporation shall be represented by uncertificated shares. Notwithstanding the adoption of such a resolution by the Board of Directors, every holder of stock represented by certificates, and upon request every holder of uncertificated shares, shall be entitled to have a certificate or certificates for the holder’s shares of the Corporation.  Such certificates shall be signed as permitted by law.  Except as otherwise expressly provided by law, the rights and obligations of the holders of certificates representing stock of the same class and series shall be identical.

Section 2. Transfer. . Shares of stock of the Corporation represented by a certificate may be transferred on the books of the Corporation by delivery of the certificate accompanied either by an assignment in writing on the back of the certificate or by a written power of attorney to sell, assign, and transfer the same on the books of the Corporation, signed by the person identified on the certificate as the owner of the shares represented thereby. Upon receipt of proper transfer instructions from the registered owner of uncertificated shares, the transfer of the shares shall be recorded upon the books of the Corporation. Within a reasonable time after the issuance or transfer of uncertificated stock, the Corporation shall send to the registered owner thereof a written notice evidencing the shares and containing the information required to be set forth on a certificate for those shares by the Delaware General Corporation Law or, unless otherwise provided by the Delaware General Corporation Law, a statement that the Corporation will furnish without charge to each stockholder who so requests a statement of the powers, designations, preferences and relative participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of those preferences and/or rights. The person registered on the books of the Corporation as the owner of any shares shall be entitled to all the rights of ownership with respect to the shares.

Section 3. Lost Certificates. No certificate for shares or uncertificated shares of stock in the Corporation shall be issued in place of any certificate alleged to have been lost, destroyed or stolen, except on production of evidence of the loss, destruction or theft in a form as the Board of Directors or its designee may in its or his discretion require.

ARTICLE VIII

SEAL

The Corporation shall have no seal unless and until the Board adopts a seal in such form as the Board may designate or approve.

ARTICLE IX

GENERAL PROVISIONS

Section 1. Fiscal Year. The fiscal year of the Corporation shall be the calendar year unless otherwise determined from time to time by the Board.

Section 2. Severability. If any provision of these Bylaws, or the application of any provision of these Bylaws to any person or circumstance, is held invalid, the remainder of the Bylaws and the application of such provision to other persons or circumstances shall not be affected.

Section 3. Waiver of Notice of Meetings of Stockholders, Directors and Committees. Any waiver of notice, given by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at nor the purpose of any regular or special meeting of the stockholders, directors, or members of a committee of directors need be specified in any written waiver of notice.

Section 4. Effective Date. These Amended and Restated Bylaws shall be effective upon the filing of the Corporation’s first Amended and Restated Certificate of Incorporation with the Delaware Secretary of State (the “Effective Date”).

- 1 -

EX-10.1

Exhibit 10.1

June 14, 2016

Mr. Tim Taylor

Vice President, Finance, Business Operations, & Strategy

Globalstar, Inc.

300 Holiday Square Blvd.

Covington, Louisiana 70433

Ref: Contract Number GINC-C-08-0390 (“Contract”) between Globalstar, Inc. (“Globalstar”) and Hughes Network Systems, LLC (“Hughes”), as amended;

Letter Agreement between Globalstar and Hughes regarding equity payment option, dated April 20, 2015 (“Equity Payment Letter Agreement”), as amended on July 2, 2015, August 11, 2015, December 3, 2015 and March 7, 2016

Dear Tim:

Reference is made to the above-referenced Contract and Equity Payment Letter Agreement.

In consideration of the mutual promises and covenants contained in this letter, Globalstar and Hughes (each a “Party” and collectively, the “Parties”) agree as follows:

1. The Parties agree to delete Section 6 of the Equity Payment Letter Agreement (as amended) in its entirety and replace it with the following new Section 6:

6.    Globalstar will provide Hughes downside protection up to and including September 30, 2016 (“Downside Protection Period”), such that (A) the total amount of gross proceeds Hughes receives from the sale of any Payment Milestone Shares plus, if applicable, the market value of any Payment Milestone Shares still held by Hughes as of the close of trading on the last day of the Downside Protection Period shall be no less than (B) $15,516,236. In the event that, at the earlier of i) the date on which Hughes has sold all of the Payment Milestone Shares and ii) the close of trading on the last day of the Downside Protection Period, (A) is less than (B), Globalstar will provide downside protection to Hughes by issuing additional shares of Freely Tradable GSAT Stock having a total value equal to the difference between (B) and (A). The additional shares to be issued, if any, will be valued at a trailing volume weighted average price for the 5 trading days prior to the earlier of the date on which the Payment Milestone Shares have been finally sold or the close of trading on the last day of the Downside Protection Period, whichever is applicable. Globalstar shall issue any such additional shares of Freely Tradable GSAT Stock within 5 business days of written notice from Hughes to be sent no later than one business day following the end of the Downside Protection Period. Any shares of Freely Tradable GSAT Stock issued by Globalstar under this Section 6 shall be freely tradable, free and clear of any liens, encumbrances, legends or other restrictions.

2. Except as amended herein, all terms and conditions of the Equity Payment Letter Agreement and Contract shall remain in full force and effect. In the event of a discrepancy between the terms and conditions contained in the Equity Payment Letter Agreement, as herein amended, and those contained in the Contract, the terms and conditions contained in the Equity Payment Letter Agreement shall prevail.

Mr. Tim Taylor

June 14, 2016

Page 2

We would appreciate Globalstar acknowledging its agreement with the terms of this fifth amendment to the Equity Payment Letter Agreement by having a duly authorized representative sign in the signature block below.

Sincerely,

/s/ Sean P. Fleming

Sean P. Fleming

Vice President and Associate General Counsel

AGREED AND ACCEPTED BY:    

GLOBALSTAR, INC.            

Signature     /s/ Timothy Taylor            

Name     Timothy Taylor                    

Title     VP, Finance     

Date     June 14, 2016                    

EX-31.1

Exhibit 31.1

Certification of Chief Executive Officer

I, James Monroe III, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Globalstar, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15(d)-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report my conclusion about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	August 4, 2016
By:	/s/ James Monroe III
	James Monroe III
	Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

Certification of Chief Financial Officer

I, Rebecca S. Clary certify that:

1. I have reviewed this quarterly report on Form 10-Q of Globalstar, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15(d)-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report my conclusion about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	August 4, 2016
By:	/s/ Rebecca S. Clary
	Rebecca S. Clary
	Chief Financial Officer (Principal Financial Officer)

EX-32.1

Exhibit 32.1

Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), the undersigned officer of Globalstar, Inc. (the “Company”), does hereby certify that:

This quarterly report on Form 10-Q for the quarter ended June 30, 2016 of the Company fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	August 4, 2016	By:	/s/ James Monroe III
			James Monroe III
			Chief Executive Officer (Principal Executive Officer)

EX-32.2

Exhibit 32.2

Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), the undersigned officer of Globalstar, Inc. (the “Company”), does hereby certify that:

This quarterly report on Form 10-Q for the quarter ended June 30, 2016 of the Company fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	August 4, 2016	By:	/s/ Rebecca S. Clary
			Rebecca S. Clary
			Chief Financial Officer (Principal Financial Officer)

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2016	Jul. 28, 2016
Document and Entity Information [Line Items]
Document type	10-Q
Amendment flag	false
Document period end date	Jun. 30, 2016
Document fiscal year focus	2016
Document fiscal period focus	Q2
Trading symbol	GSAT
Entity registrant name	Globalstar, Inc.
Entity central index key	0001366868
Current fiscal year end date	--12-31
Entity filer category	Large Accelerated Filer
Voting common stock
Document and Entity Information [Line Items]
Entity common stock, shares outstanding (in shares)		946,270,691
Nonvoting common stock
Document and Entity Information [Line Items]
Entity common stock, shares outstanding (in shares)		134,008,656

XML

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Revenue:
Service revenues	$ 20,970	$ 18,616	$ 39,719	$ 35,723
Subscriber equipment sales	4,116	4,407	7,203	8,322
Total revenue	25,086	23,023	46,922	44,045
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	7,937	8,027	15,528	15,461
Cost of subscriber equipment sales	2,886	2,983	5,064	6,114
Marketing, general and administrative	11,450	10,159	20,060	18,755
Depreciation, amortization, and accretion	19,224	19,271	38,379	38,317
Total operating expenses	41,497	40,440	79,031	78,647
Loss from operations	(16,411)	(17,417)	(32,109)	(34,602)
Other income (expense):
Loss on extinguishment of debt	0	(2,189)	0	(2,254)
Loss on equity issuance	(2,075)	(2,912)	(1,923)	(2,912)
Interest income and expense, net of amounts capitalized	(9,049)	(9,244)	(18,154)	(17,761)
Derivative gain	40,499	237,087	39,155	129,222
Other	685	(452)	(76)	3,681
Total other income (expense)	30,060	222,290	19,002	109,976
Income (loss) before income taxes	13,649	204,873	(13,107)	75,374
Income tax expense (benefit)	(450)	106	(259)	334
Net income (loss)	14,099	204,767	(12,848)	75,040
Other comprehensive income (loss):
Foreign currency translation adjustments	(925)	447	(1,576)	(843)
Total comprehensive income (loss)	$ 13,174	$ 205,214	$ (14,424)	$ 74,197
Net income (loss) per common share:
Basic (USD per share)	$ 0.01	$ 0.20	$ (0.01)	$ 0.07
Diluted (USD per share)	$ 0.01	$ 0.17	$ (0.01)	$ 0.07
Weighted-average shares outstanding:
Basic (in shares)	1,049,381	1,009,917	1,045,205	1,005,406
Diluted (in shares)	1,249,672	1,205,450	1,045,205	1,199,182

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Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 11,269	$ 7,476
Accounts receivable, net of allowance of $4,330 and $5,270, respectively	16,164	14,536
Inventory	9,698	12,023
Prepaid expenses and other current assets	5,030	4,456
Total current assets	42,161	38,491
Property and equipment, net	1,059,019	1,077,560
Restricted cash	37,918	37,918
Prepaid second-generation ground costs	4,165	8,929
Intangible and other assets, net of accumulated amortization of $6,873 and $6,315, respectively	13,497	12,117
Total assets	1,156,760	1,175,015
Current liabilities:
Current portion of long-term debt	38,112	32,835
Accounts payable	6,039	8,118
Accrued contract termination charge	19,468	19,121
Accrued expenses	26,955	22,439
Payables to affiliates	240	616
Deferred revenue	25,225	23,902
Total current liabilities	116,039	107,031
Long-term debt, less current portion	540,350	548,286
Employee benefit obligations	4,894	4,810
Derivative liabilities	200,482	239,642
Deferred revenue	6,125	6,413
Debt restructuring fees	20,795	20,795
Other non-current liabilities	11,931	10,907
Total non-current liabilities	784,577	830,853
Commitments and contingent liabilities (Notes 7 and 8)
Stockholders’ equity:
Preferred Stock	0	0
Additional paid-in capital	1,624,875	1,591,443
Accumulated other comprehensive loss	(6,409)	(4,833)
Retained deficit	(1,362,430)	(1,349,582)
Total stockholders’ equity	256,144	237,131
Total liabilities and stockholders’ equity	1,156,760	1,175,015
Series A preferred stock
Stockholders’ equity:
Preferred Stock	0	0
Common stock
Stockholders’ equity:
Common Stock	95	90
Nonvoting common stock
Stockholders’ equity:
Common Stock	$ 13	$ 13

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Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Accounts receivable, allowance	$ 4,330	$ 5,270
Accumulated amortization	$ 6,873	$ 6,315
Preferred stock, par value (USD per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized (in shares)	100,000,000	100,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Series A preferred stock
Preferred stock, par value (USD per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized (in shares)	1	1
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock
Common stock, par value (USD per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	1,200,000,000	1,200,000,000
Common stock, shares issued (in shares)	946,245,007	904,448,226
Common stock, shares outstanding (in shares)	946,245,007	904,448,226
Nonvoting common stock
Common stock, par value (USD per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	400,000,000	400,000,000
Common stock, shares issued (in shares)	134,008,656	134,008,656
Common stock, shares outstanding (in shares)	134,008,656	134,008,656

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Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Cash flows provided by (used in) operating activities:
Net income (loss)	$ (12,848)	$ 75,040
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation, amortization, and accretion	38,379	38,317
Change in fair value of derivative assets and liabilities	(39,155)	(129,222)
Stock-based compensation expense	1,848	1,472
Amortization of deferred financing costs	4,672	4,667
Provision for bad debts	396	1,900
Noncash interest and accretion expense	5,487	5,712
Loss on extinguishment of debt	0	2,254
Loss on equity issuance	1,923	2,912
Noncash expense related to legal settlement	1,094	0
Unrealized foreign currency gain	(77)	(3,442)
Other, net	262	618
Changes in operating assets and liabilities:
Accounts receivable	(2,144)	(3,652)
Inventory	2,924	2,562
Prepaid expenses and other current assets	(868)	(788)
Other assets	104	(493)
Accounts payable and accrued expenses	(1,474)	(63)
Payables to affiliates	(377)	(25)
Other non-current liabilities	50	(429)
Deferred revenue	805	1,398
Net cash provided by (used in) operating activities	1,001	(1,262)
Cash flows used in investing activities:
Second-generation network costs (including interest)	(5,307)	(10,344)
Property and equipment additions	(6,345)	(2,325)
Purchase of intangible assets	(806)	(1,343)
Net cash used in investing activities	(12,458)	(14,012)
Cash flows provided by (used in) financing activities:
Principal payments of the Facility Agreement	(16,418)	(3,225)
Proceeds from issuance of stock to Terrapin	28,500	24,000
Proceeds from issuance of common stock and exercise of options and warrants	3,016	419
Net cash provided by financing activities	15,098	21,194
Effect of exchange rate changes on cash	152	(170)
Net increase in cash and cash equivalents	3,793	5,750
Cash and cash equivalents, beginning of period	7,476	7,121
Cash and cash equivalents, end of period	11,269	12,871
Supplemental disclosure of cash flow information:
Interest	10,922	9,746
Income taxes	127	5
Supplemental disclosure of non-cash financing and investing activities:
Increase in capitalized accrued interest for second-generation satellites and ground costs	1,500	995
Increase in accrued second-generation network costs	191	0
Capitalization of the accretion of debt discount and amortization of prepaid financing costs	2,099	1,580
Payments made in convertible notes and common stock	0	735
Principal amount of debt converted into common stock	0	6,491
Reduction of debt discount and issuance costs due to note conversions	0	2,085
Fair value of common stock issued upon conversion of debt	0	26,669
Reduction in derivative liability due to conversion of debt	0	20,008
Fair value of common stock issued to vendor for payment of invoices	$ 0	$ 16,684

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Basis of Presentation

6 Months Ended

Jun. 30, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

BASIS OF PRESENTATION

Globalstar, Inc. (“Globalstar” or the “Company”) provides Mobile Satellite Services (“MSS”) including voice and data communications services through its global satellite network. Thermo Capital Partners LLC, through its affiliates (collectively, “Thermo”), is the principal owner and largest stockholder of Globalstar. The Company’s Chairman and Chief Executive Officer controls Thermo. Two other members of the Company's Board of Directors are also directors, officers or minority equity owners of various Thermo entities.

The Company has prepared the accompanying unaudited interim condensed consolidated financial statements in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information. Certain information and footnote disclosures normally in financial statements have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"); however, management believes the disclosures made are adequate to make the information presented not misleading. These financial statements and notes should be read in conjunction with the consolidated financial statements and notes thereto included in the Globalstar Annual Report on Form 10-K for the year ended December 31, 2015, as filed with the SEC on February 26, 2016 (the "2015 Annual Report"), and Management's Discussion and Analysis of Financial Condition and Results of Operations herein. 

The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from estimates. The Company evaluates estimates on an ongoing basis. Significant estimates include the value of derivative instruments, the allowance for doubtful accounts, the net realizable value of inventory, the useful life and value of property and equipment, the value of stock-based compensation and income taxes. The Company has made certain reclassifications to prior period condensed consolidated financial statements to conform to current period presentation.

These unaudited interim condensed consolidated financial statements include the accounts of Globalstar and all its subsidiaries. All significant intercompany transactions and balances have been eliminated in the consolidation. In the opinion of management, the information included herein includes all adjustments, consisting of normal recurring adjustments, that are necessary for a fair presentation of the Company’s condensed consolidated statements of operations, condensed consolidated balance sheets, and condensed consolidated statements of cash flows for the periods presented. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results that may be expected for the full year or any future period.

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers. ASU No. 2014-09 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. This ASU requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In August 2015, the FASB decided to delay the effective date of ASU No. 2014-09. With the one-year deferral, ASU No. 2014-09 is now effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Additionally, early adoption is now permitted. However, entities reporting under U.S. GAAP are not permitted to adopt the standard earlier than the original effective date of December 15, 2016. The standard permits the use of either the retrospective or cumulative effect transition method. In March 2016, the FASB issued ASU No. 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net), which does not change the core principle of the guidance in ASU No. 2014-09 but clarifies the implementation guidance on principal versus agent considerations. The effective date and transition requirements for ASU No. 2016-08 are the same as those of ASU No. 2014-09. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing, which amends the guidance on accounting for licenses of intellectual property and identifying performance obligations in its new revenue standard. In May 2016, the FASB issued ASU No. 2016-12 Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients, whichis intended to reduce the cost and complexity of applying the new revenue standard and result in more consistent application. The Company is currently evaluating the impact that these standards will have on its financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of these standards on its ongoing reporting.

In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory. ASU No. 2015-11 requires that inventory within the scope of the guidance be measured at the lower of cost and net realizable value. Inventory measured using last-in, first-out (LIFO) and retail inventory method (RIM) are excluded from this new guidance. This ASU replaces the concept of market with the single measurement of net realizable value and is intended to create efficiencies for preparers and more closely align U.S. GAAP with IFRS. This ASU is effective for public business entities in fiscal years, and interim periods within those years, beginning after December 15, 2016. Prospective application is required and early adoption is permitted as of the beginning of an interim or annual reporting period. The Company is currently evaluating the impact this standard will have on its financial statements and related disclosures, but does not expect this ASU to have a material effect on its consolidated financial statements and related disclosures.

In November 2015, the FASB issued ASU. No. 2015-17, Balance Sheet Classification of Deferred Taxes. ASU No. 2015-17 simplifies the presentation of deferred taxes on the balance sheet by requiring classification of all deferred tax items as noncurrent including valuation allowances by jurisdiction. The ASU is effective for public entities for annual and interim periods beginning after December 15, 2016. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company is currently evaluating the impact this standard will have on its financial statements and related disclosures, but does not expect the effect to be material.

In March 2016, the FASB issued ASU No. 2016-02, Leases. The main difference between the provisions of ASU No. 2016-02 and previous U.S. GAAP is the recognition of right-of-use assets and lease liabilities by lessees for those leases classified as operating leases under previous U.S. GAAP. ASU No. 2016-02 retains a distinction between finance leases and operating leases, and the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from previous U.S. GAAP. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize right-of-use assets and lease liabilities. The accounting applied by a lessor is largely unchanged from that applied under previous U.S. GAAP. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. This ASU is effective for public business entities in fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company has not yet determined the effect of the standard on its ongoing reporting.

In March 2016, the FASB issued ASU No. 2016-04, Liabilities-Extinguishment of Liabilities: Recognition of Breakage for Certain Prepaid Stored-Value Products. ASU No. 2016-04 contains specific guidance for the derecognition of prepaid stored-value product liabilities within the scope of this ASU. This ASU is effective for public entities for annual and interim periods beginning after December 15, 2017. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company does not expect this ASU to have a material effect on its consolidated financial statements and related disclosures.

In March 2016, the FASB issued ASU. No. 2016-06, Derivatives and Hedging: Contingent Put and Call Options in Debt Instruments. ASU No. 2016-06 clarifies the requirements for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. This ASU is effective for public entities for annual and interim periods beginning after December 15, 2016. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company has not yet determined the effect of this standard on its ongoing reporting.

In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation. ASU No. 2016-09 simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. This ASU is effective for public business entities for annual and interim periods beginning after December 15, 2016. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company has not yet determined the effect of this standard on its ongoing reporting.

In June 2016, the FASB issued ASU No. 2016-13, Credit Losses, Measurement of Credit Losses on Financial Instruments. ASU No. 2016-13 significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The standard will replace today’s incurred loss approach with an expected loss model for instruments measured at amortized cost. Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. This ASU is effective for public entities for annual and interim periods beginning after December 15, 2019. Early adoption is permitted for all entities for annual periods beginning after December 15, 2018, and interim periods therein. The Company has not yet determined the effect of this standard on its ongoing reporting.

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Property and Equipment

6 Months Ended

Jun. 30, 2016

Property, Plant and Equipment [Abstract]

Property and Equipment

PROPERTY AND EQUIPMENT

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

	June 30, 2016			December 31, 2015
Globalstar System:
Space component
First and second-generation satellites in service	$	1,211,226		$	1,211,768
Prepaid long-lead items	17,040			17,040
Second-generation satellite, on-ground spare	32,481			32,481
Ground component	48,184			46,870
Construction in progress:
Space component	81			81
Ground component	190,328			177,780
Next-generation software upgrades	8,435			3,440
Other	2,375			2,153
Total Globalstar System	1,510,150			1,491,613
Internally developed and purchased software	14,753			14,492
Equipment	11,996			10,802
Land and buildings	3,343			3,151
Leasehold improvements	1,731			1,671
Total property and equipment	1,541,973			1,521,729
Accumulated depreciation	(482,954		)	(444,169		)
Total property and equipment, net	$	1,059,019		$	1,077,560

Amounts in the above table consist primarily of costs incurred related to the construction of the Company’s second-generation constellation and ground upgrades. The ground component of construction in progress represents costs (including capitalized interest) associated with the Company's contracts with Hughes Network Systems, LLC ("Hughes") and Ericsson Inc. (“Ericsson”) to complete next-generation upgrades to the Company's ground infrastructure. The Company expects to begin depreciating this asset in the near future. See Note 7: Commitments for further discussion of these contracts.

Amounts included in the Company’s second-generation satellite, on-ground spare balance as of June 30, 2016 consist primarily of costs related to a spare second-generation satellite that has not been placed in orbit, but is capable of being included in a future launch. As of June 30, 2016, this satellite and the prepaid long-lead items ("LLI") have not been placed into service; therefore, the Company has not started to record depreciation expense for these items.

Pursuant to the Amended and Restated Contract for the construction of Globalstar Satellites for the Second Generation Constellation between the Company and Thales Alenia Space France ("Thales"), dated and executed in June 2009 (the "2009 Contract"), the Company paid €12 million in purchase price plus an additional €3.1 million in procurement costs for the LLI to be procured by Thales on the Company's behalf. The LLI were to be used in the construction of the Phase 3 satellites for the Company. As reflected on the Company's condensed consolidated balance sheets and in the above table, the Company believes that it owns the LLI and that title to them transferred upon payment. The Company has asked Thales to turn over the LLI. Despite historical statements to the contrary, Thales currently disputes the Company's ownership of the LLI and has asserted that the Company released its title to the LLI pursuant to that certain Release Agreement, dated as of June 24, 2012, which is described more fully in Note 8: Contingencies. Thales further asserts that the LLI belong to Thales and that Thales has no obligation to turn over possession of the LLI to the Company. The Company disputes Thales' assertions and is currently considering its rights and remedies to recover the LLI. At this time, the Company cannot predict the outcome related to this dispute, including, without limitation, the likelihood of any settlement or the probability of success with respect to any litigation that the Company may determine to commence with respect to the LLI.

Capitalized Interest and Depreciation Expense

The following table summarizes capitalized interest (in thousands):   

	Three Months Ended   June 30,						Six Months Ended   June 30,
	2016			2015			2016			2015
Interest costs eligible to be capitalized	$	11,947		$	10,589		$	23,792		$	20,705
Interest costs recorded in interest income (expense), net	(8,565		)	(8,125		)	(17,144		)	(16,049		)
Net interest capitalized	$	3,382		$	2,464		$	6,648		$	4,656

The following table summarizes depreciation expense (in thousands): 

	Three Months Ended   June 30,				Six Months Ended   June 30,
	2016		2015		2016		2015
Depreciation expense	$	19,118	$	19,127	$	38,168	$	38,030

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Long-Term Debt and Other Financing Arrangements

6 Months Ended

Jun. 30, 2016

Debt Disclosure [Abstract]

Long-Term Debt and Other Financing Arrangements

LONG-TERM DEBT AND OTHER FINANCING ARRANGEMENTS

As required by U.S. GAAP, the Company adopted the provisions of ASU No. 2015-03, Interest - Imputation of Interest - Simplifying the Presentation of Debt Issue Costs during the quarter ended March 31, 2016. ASU 2015-03 requires that debt issuance costs related to a recognized debt liability be presented in the condensed consolidated balance sheets as a reduction in the carrying amount of the related debt liability, consistent with debt discounts. The Company has applied the provisions of this ASU on a retrospective basis, and therefore, the Company has reduced long-term debt on its condensed consolidated balance sheet as of December 31, 2015 by $57.9 million of deferred financing costs previously reported as assets.

Long-term debt consists of the following (in thousands): 

	June 30, 2016						December 31, 2015
	Principal Amount		Unamortized Discount and Deferred Financing Costs		Carrying Value		Principal Amount		Unamortized Discount and Deferred Financing Costs		Carrying Value
Facility Agreement	$	559,429	$	51,702	$	507,727	$	575,846	$	57,829	$	518,017
Thermo Loan Agreement	88,400		31,136		57,264		83,222		32,558		50,664
8.00% Convertible Senior Notes Issued in 2013	16,936		3,465		13,471		16,747		4,307		12,440
Total Debt	664,765		86,303		578,462		675,815		94,694		581,121
Less: Current Portion	38,112		—		38,112		32,835		—		32,835
Long-Term Debt	$	626,653	$	86,303	$	540,350	$	642,980	$	94,694	$	548,286

The principal amounts shown above include payment of in-kind interest, as applicable. The carrying value is net of deferred financing costs and any discounts to the loan amounts at issuance, including accretion, as further described below. The current portion of long-term debt represents the scheduled principal repayments under the Facility Agreement due within one year of the balance sheet date.

Facility Agreement

On July 31, 2013, the Company entered into a Global Deed of Amendment and Restatement with Thermo, the Company's domestic subsidiaries, a syndicate of bank lenders, including BNP Paribas, Société Générale, Natixis, Credit Agricole Corporate and Investment Bank and Credit Industrial et Commercial, as arrangers, and BNP Paribas, as the security agent and COFACE Agent, providing for the amendment and restatement of its former facility agreement and certain related credit documents effective August 22, 2013 (the amended and restated facility agreement is herein referred to as the "Facility Agreement"). On August 7, 2015, the Company, Thermo, the lenders and their agent entered into a Second Global Amendment and Restatement Agreement (the "2015 GARA").

The Facility Agreement is scheduled to mature in December 2022. As of June 30, 2016, the Facility Agreement was fully drawn. Semi-annual principal repayments began in December 2014. The facility bears interest at a floating rate of LIBOR plus 2.75% through June 2017, increasing by an additional 0.5% each year thereafter to a maximum rate of LIBOR plus 5.75%. Ninety-five percent of the Company’s obligations under the Facility Agreement are guaranteed by COFACE, the French export credit agency. The Company’s obligations under the Facility Agreement are guaranteed on a senior secured basis by all of its domestic subsidiaries and are secured by a first priority lien on substantially all of the assets of the Company and its domestic subsidiaries (other than their FCC licenses), including patents and trademarks, 100% of the equity of the Company’s domestic subsidiaries and 65% of the equity of certain foreign subsidiaries.  

The Facility Agreement contains customary events of default and requires that the Company satisfy various financial and non-financial covenants. Pursuant to the terms of the Facility Agreement, the Company has the ability to cure noncompliance with financial covenants with Equity Cure Contributions (as described below) through a date as late as June 2019. If the Company violates any of these covenants and is unable to make a sufficient Equity Cure Contribution or obtain a waiver, it would be in default under the agreement and payment of the indebtedness could be accelerated. The acceleration of the Company's indebtedness under one agreement may permit acceleration of indebtedness under other agreements that contain cross-acceleration provisions. The covenants in the Facility Agreement limit the Company's ability to, among other things, incur or guarantee additional indebtedness; make certain investments, acquisitions or capital expenditures above certain agreed levels; pay dividends or repurchase or redeem capital stock or subordinated indebtedness; grant liens on its assets; incur restrictions on the ability of its subsidiaries to pay dividends or to make other payments to the Company; enter into transactions with its affiliates; merge or consolidate with other entities or transfer all or substantially all of its assets; and transfer or sell assets. As of June 30, 2016, the Company was in compliance with respect to the covenants of the Facility Agreement.

The compliance calculations of the financial covenants of the Facility Agreement permit inclusion of certain cash funds contributed to the Company from the issuance of the Company's common stock and/or subordinated indebtedness. These funds are referred to as "Equity Cure Contributions" and may be funded in order to achieve compliance with financial covenants, subject to the conditions set forth in the Facility Agreement. Each Equity Cure Contribution must be made in a minimum amount of $10 million for each measurement period or in the aggregate for all periods until the date that such funding is no longer allowed by the Facility Agreement. In August 2015 and February 2016, the Company drew $15 million and $6.5 million, respectively, under its common stock purchase agreement with Terrapin Opportunity, L.P. ("Terrapin") (the "August 2015 Terrapin Agreement"). The Company used a portion of these funds as an Equity Cure Contribution under the Facility Agreement with respect to the calculation of compliance with financial covenants for the measurement period ended December 31, 2015. In June 2016, the Company drew $22 million under the August 2015 Terrapin Agreement. The Company used these funds as an Equity Cure Contribution under the Facility Agreement with respect to the calculation of compliance with financial covenants for the measurement period ended June 30, 2016. The Company may draw the remaining amounts available under the August 2015 Terrapin Agreement to achieve compliance with certain financial covenants under the Facility Agreement.

The Facility Agreement requires the Company to maintain a total of $37.9 million in a debt service reserve account, which is pledged to secure all of the Company's obligations under the Facility Agreement. The use of these funds is restricted to making principal and interest payments under the Facility Agreement. As of June 30, 2016, the balance in the debt service reserve account, which was established with the proceeds of the loan agreement with Thermo discussed below, was $37.9 million and classified as restricted cash on the Company's condensed consolidated balance sheets. 

Thermo Loan Agreement 

In connection with the amendment and restatement of the Facility Agreement, the Company amended and restated its loan agreement with Thermo (as amended and restated, the “Loan Agreement”). All obligations of the Company to Thermo under the Loan Agreement are subordinated to all of the Company’s obligations under the Facility Agreement.

The Loan Agreement accrues interest at 12% per annum, which is capitalized and added to the outstanding principal in lieu of cash payments. The Company will make payments to Thermo only when permitted by the Facility Agreement. Principal and interest under the Loan Agreement become due and payable six months after the obligations under the Facility Agreement have been paid in full, or earlier if the Company has a change in control or if any acceleration of the maturity of the loans under the Facility Agreement occurs. As of June 30, 2016, $44.9 million of interest had accrued since 2009 with respect to the Loan Agreement; the Loan Agreement is included in long-term debt on the Company’s condensed consolidated balance sheets.

The Company evaluated the various embedded derivatives within the Loan Agreement (See Note 5: Fair Value Measurements for additional information about the embedded derivative in the Loan Agreement). The Company determined that the conversion option and the contingent put feature upon a fundamental change required bifurcation from the Loan Agreement. The conversion option and the contingent put feature were not deemed clearly and closely related to the Loan Agreement and were separately accounted for as a standalone derivative. The Company recorded this compound embedded derivative liability as a non-current liability on its condensed consolidated balance sheets with a corresponding debt discount, which is netted against the face value of the Loan Agreement.

The Company is accreting the debt discount associated with the compound embedded derivative liability to interest expense through the maturity of the Loan Agreement using an effective interest rate method. The fair value of the compound embedded derivative liability is marked-to-market at the end of each reporting period, with any changes in value reported in the condensed consolidated statements of operations. The Company determines the fair value of the compound embedded derivative using a blend of a Monte Carlo simulation model and market prices.

In connection with, and as a condition to the effectiveness of, the 2015 GARA, Thermo and certain of its affiliates executed and delivered to the agent under the Facility Agreement an undertaking (the “Second Thermo Group Undertaking Letter”) in which they agreed that, during the period commencing on the effective date of the 2015 GARA and ending on the later of March 31, 2018 and, if the Company's 8.00% Notes Issued in 2013 shall have been redeemed in full, September 30, 2019 (the “Commitment Period”), under certain circumstances, they will make, or cause to be made, available to the Company cash equity financing in the aggregate amount of up to $30.0 million.

The balance of this commitment is reduced by any cash equity financing received by the Company during the Commitment Period from Thermo or an external equity funding source, including Terrapin, if the Company uses the funds as an Equity Cure Contribution.

Simultaneously with the execution of the 2015 GARA and the Second Thermo Group Undertaking Letter, the Company entered into an Equity Commitment Agreement (the “Equity Agreement”) and the Loan Agreement.

Pursuant to the Equity Agreement, Thermo agreed to make, or cause to be made, available to the Company up to $30.0 million in additional cash equity investments as contemplated by the 2015 GARA and the Second Thermo Group Undertaking Letter. The price per share that Thermo will pay to purchase any shares of the Company's common stock pursuant to this equity commitment will be established using the same method as used to establish the price per share under the August 2015 Terrapin Agreement. If the issuance of shares of voting common stock to Thermo pursuant to the Equity Agreement would constitute a “Change of Control,” “Default” or “Event of Default” under any applicable agreement, the Company will issue instead an equal number of shares of non-voting common stock.

Since the inception of the 2015 GARA, the Company has received cash equity financing in excess of Thermo's equity commitment. This cash equity financing primarily includes draws under the August 2015 Terrapin Agreement in August 2015, February 2016, and June 2016 for $15.0 million, $6.5 million, and $22.0 million, respectively. As a result, Thermo has no remaining cash equity commitment under the Equity Agreement as of June 30, 2016.

All of the transactions between the Company and Thermo and its affiliates were reviewed and approved on the Company's behalf by a Special Committee of its independent directors, who were represented by independent counsel.

8.00% Convertible Senior Notes Issued in 2013

The 8.00% Convertible Senior Notes Issued in 2013 (the "2013 8.00% Notes") initially were convertible into shares of common stock at a conversion price of $0.80 per share of common stock, or 1,250 shares of the Company’s common stock per $1,000 principal amount of the 2013 8.00% Notes, subject to adjustment. The conversion price of the 2013 8.00% Notes is adjusted in the event of certain stock splits or extraordinary share distributions, or as a reset of the base conversion and exercise price pursuant to the terms of the Fourth Supplemental Indenture between the Company and U.S. Bank National Association, as Trustee, dated May 20, 2013 (the "Indenture"). Due to common stock issuances by the Company since May 20, 2013 at prices below the then effective conversion rate, the base conversion price (rounded to the nearest cent) has been reduced to $0.73 per share of common stock as of June 30, 2016. 

The 2013 8.00% Notes are senior unsecured debt obligations of the Company with no sinking fund. The 2013 8.00% Notes will mature on April 1, 2028, subject to various call and put features, and bear interest at a rate of 8.00% per annum. Interest on the 2013 8.00% Notes is payable semi-annually in arrears on April 1 and October 1 of each year. Interest is paid in cash at a rate of 5.75% per annum and in additional notes at a rate of 2.25% per annum. The Indenture for the 2013 8.00% Notes provides for customary events of default. As of June 30, 2016, the Company was in compliance with respect to the terms of the 2013 8.00% Notes and the Indenture. 

Subject to certain conditions set forth in the Indenture, the Company may redeem the 2013 8.00% Notes, with the prior approval of the majority lenders under the Facility Agreement, in whole or in part, at any time on or after April 1, 2018, at a price equal to the principal amount of the 2013 8.00% Notes to be redeemed plus all accrued and unpaid interest thereon. 

A holder of the 2013 8.00% Notes has the right, at the holder’s option, to require the Company to purchase some or all of the 2013 8.00% Notes held by it on each of April 1, 2018 and April 1, 2023 at a price equal to the principal amount of the 2013 8.00% Notes to be purchased plus accrued and unpaid interest. 

Subject to the procedures for conversion and other terms and conditions of the Indenture, a holder may convert its 2013 8.00% Notes at its option at any time prior to the close of business on the business day immediately preceding April 1, 2028, into shares of common stock (or, at the option of the Company, cash in lieu of all or a portion thereof, provided that, under the Facility Agreement, the Company may pay cash only with the consent of the Majority Lenders). 

As of June 30, 2016, holders had converted a total of $39.4 million principal amount of the 2013 8.00% Notes, resulting in the issuance of approximately 72.1 million shares of voting common stock. There were no conversions during the three and six month periods ended June 30, 2016. During the three-month period ended June 30, 2015, holders converted a total of $6.3 million principal amount of the 2013 8.00% Notes, resulting in the issuance of approximately 10.4 million shares of voting common stock, and recognition of a loss on extinguishment of debt of $2.2 million. During the six-month period ended June 30, 2015, holders converted a total of $6.5 million principal amount of the 2013 8.00% Notes, resulting in the issuance of approximately 10.9 million shares of voting common stock, and recognition of a loss on extinguishment of debt of $2.3 million.

Holders who convert 2013 8.00% Notes receive conversion shares over a 40-consecutive trading day settlement period. Accordingly, the portion of converted debt is extinguished on an incremental basis over the 40-day settlement period, reducing the Company's outstanding debt balance. As of June 30, 2016, no conversions had been initiated but not yet fully settled.

The Company evaluated the various embedded derivatives within the Indenture for the 2013 8.00% Notes. The Company determined that the conversion option and the contingent put feature within the Indenture required bifurcation from the 2013 8.00% Notes. The Company did not deem the conversion option and the contingent put feature to be clearly and closely related to the 2013 8.00% Notes and separately accounted for them as a standalone derivative. The Company recorded this compound embedded derivative liability as a non-current liability on its condensed consolidated balance sheets with a corresponding debt discount which is netted against the face value of the 2013 8.00% Notes. 

The Company is accreting the debt discount associated with the compound embedded derivative liability to interest expense through the first put date of the 2013 8.00% Notes (April 1, 2018) using an effective interest rate method. The Company is marking to market the fair value of the compound embedded derivative liability at the end of each reporting period, with any changes in value reported in the condensed consolidated statements of operations. The Company determines the fair value of the compound embedded derivative using a blend of a Monte Carlo simulation model and market prices. 

Warrants Outstanding

Warrants are outstanding to purchase shares of common stock as shown in the table below: 

	Outstanding Warrants		Strike Price
	June 30, 2016	December 31, 2015	June 30, 2016		December 31, 2015
Contingent Equity Agreement (1)	24,571,428	30,191,866	$	0.01	$	0.01
5.0% Warrants (2)	—	8,000,000	—		0.32
	24,571,428	38,191,866

(1) Pursuant to the terms of the Contingent Equity Agreement with Thermo (See Note 9: Related Party Transactions in the Consolidated Financial Statements in the 2015 Annual Report for a description of the Contingent Equity Agreement), the Company issued to Thermo warrants to purchase shares of common stock pursuant to the annual availability fee and subsequent reset provisions in the Contingent Equity Agreement. These warrants were issued between June 2009 and June 2012 and have a five-year exercise period from issuance. As of June 30, 2016, Thermo had exercised warrants to purchase approximately 16.9 million of these shares prior to the expiration of the associated warrants. In June 2016, Thermo exercised warrants to purchase 5.6 million shares of voting common stock for a total purchase price of $0.1 million. The exercise period for the remaining outstanding warrants expires in June 2017.

(2) In June 2011, the Company issued warrants (the “5.0% Warrants”) to purchase 15.2 million shares of its voting common stock in connection with the issuance of its 5.0% Convertible Senior Unsecured Notes. In June 2016, Thermo exercised all of the remaining warrants outstanding to purchase 8.0 million shares of voting common stock for a total purchase price of $2.5 million. See Note 3: Long-Term Debt and Other Financing Arrangements in the Consolidated Financial Statements in the 2015 Annual Report for a complete description of the 5.0% Warrants.

Terrapin Opportunity, L.P. Common Stock Purchase Agreement

On December 28, 2012 the Company entered into a common stock purchase agreement with Terrapin pursuant to which the Company, subject to certain conditions, could require Terrapin to purchase up to $30.0 million of shares of voting common stock over the 24-month term following the effectiveness of a resale registration statement, which became effective on August 2, 2013. When the Company made a draw under this Terrapin common stock purchase agreement, it issued Terrapin shares of common stock at a price per share calculated as specified in the agreement. During the six months ended June 30, 2015, the Company drew $24.0 million under the agreement and issued 11.1 million shares of voting common stock to Terrapin at an average price of $2.18 per share. Through the term of this agreement, Terrapin purchased a total of 17.2 million shares of voting common stock at a total purchase price of $30.0 million. No funds remain available under this agreement.

In conjunction with the amendment of the Facility Agreement in August 2015 (as discussed above), the Company entered into a new common stock purchase agreement with Terrapin pursuant to which the Company may require Terrapin to purchase up to $75.0 million of shares of the Company’s voting common stock over the 24-month term following the date of the agreement. From time to time over the 24-month term, in the Company’s discretion, the Company may present Terrapin with up to 24 draw notices requiring Terrapin to purchase a specified dollar amount of shares of voting common stock, based on the price per share per day over ten consecutive trading days (a "Draw Down Period"). The per share purchase price for these shares of voting common stock will equal the daily volume weighted average price of the common stock on each date during the Draw Down Period on which shares are purchased by Terrapin, but not less than a minimum price specified by the Company (a “Threshold Price”), less a discount ranging from 2.75% to 4.00% based on the Threshold Price. In addition, in the Company’s discretion, but subject to certain limitations, the Company may grant to Terrapin the option to purchase additional shares during a Draw Down Period. The Company has agreed not to sell to Terrapin a number of shares of voting common stock that, when aggregated with all other shares of voting common stock then beneficially owned by Terrapin and its affiliates, would result in their beneficial ownership of more than 9.9% of the then issued and outstanding shares of voting common stock. As discussed above in this Note 3: Long-Term Debt and Other Financing Arrangements and in Note 9: Related Party Transactions, Thermo committed, under certain conditions, to purchase equity securities of the Company on the same pricing terms as the August 2015 Terrapin Agreement.

In August 2015, the Company drew $15.0 million under the August 2015 Terrapin Agreement and issued 9.3 million shares of voting common stock to Terrapin at an average price of $1.61 per share. In February 2016, the Company drew $6.5 million under the August 2015 Terrapin Agreement and issued 6.4 million shares of voting common stock to Terrapin at an average price of $1.02 per share. In June 2016, the Company drew $22.0 million under the August 2015 Terrapin Agreement and issued 19.5 million shares of voting common stock to Terrapin at an average price of $1.13 per share. As of June 30, 2016, $31.5 million remained available under the August 2015 Terrapin Agreement. The Company will make additional draws from time to time under the August 2015 Terrapin Agreement to be used as Equity Cure Contributions under the Facility Agreement or for general corporate purposes.

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Derivatives

6 Months Ended

Jun. 30, 2016

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives

DERIVATIVES

In connection with certain existing and past borrowing arrangements, the Company was required to record derivative instruments on its condensed consolidated balance sheets. None of these derivative instruments is designated as a hedge. The following tables disclose the fair values of the derivative instruments on the Company’s condensed consolidated balance sheets (in thousands):

	June 30, 2016			December 31, 2015
Derivative assets:
Interest rate cap	$	1		$	6
Total derivative assets	$	1		$	6
Derivative liabilities:
Compound embedded derivative with 2013 8.00% Notes	$	(20,420	)	$	(26,203	)
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	(180,062		)	(213,439		)
Total derivative liabilities	$	(200,482	)	$	(239,642	)

 The following table discloses the changes in value recorded as derivative gain (loss) in the Company’s condensed consolidated statement of operations (in thousands): 

	Three Months Ended						Six Months Ended
	June 30, 2016			June 30, 2015			June 30, 2016			June 30, 2015
Interest rate cap	$	(1	)	$	(6	)	$	(5	)	$	(27	)
Compound embedded derivative with 2013 8.00% Notes	5,335			37,928			5,783			18,892
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	35,165			199,165			33,377			110,357
Total derivative gain	$	40,499		$	237,087		$	39,155		$	129,222

Intangible and Other Assets

Interest Rate Cap

In June 2009, in connection with entering into the Facility Agreement, under which interest accrues at a variable rate, the Company entered into fiveten-year interest rate cap agreements. The interest rate cap agreements reflect a variable notional amount at interest rates that provide coverage to the Company for exposure resulting from escalating interest rates over the term of the Facility Agreement. The interest rate cap provides limits on the six-month Libor rate (“Base Rate”) used to calculate the coupon interest on outstanding amounts on the Facility Agreement and is capped at 5.50% should the Base Rate not exceed 6.5%. Should the Base Rate exceed 6.5%, the Company’s Base Rate will be 1% less than the then six-month Libor rate. The Company paid an approximately $12.4 million upfront fee for the interest rate cap agreements. The interest rate cap did not qualify for hedge accounting treatment, and changes in the fair value of the agreements are included in the condensed consolidated statements of operations.

Derivative Liabilities

The Company has identified various embedded derivatives resulting from certain features in the Company’s debt instruments. These embedded derivatives required bifurcation from the debt host agreement. All embedded derivatives that required bifurcation are recorded as a derivative liability on the Company’s condensed consolidated balance sheets with a corresponding debt discount netted against the principal amount of the related debt instrument. The Company accretes the debt discount associated with each derivative liability to interest expense over the term of the related debt instrument using an effective interest rate method. The fair value of each embedded derivative liability is marked-to-market at the end of each reporting period with any changes in value reported in its condensed consolidated statements of operations. Each liability and the features embedded in the debt instrument, which required the Company to account for the instrument as a derivative, are described below.

Compound Embedded Derivative with the 2013 8.00% Notes

As a result of the conversion option and the contingent put feature within the 2013 8.00% Notes, the Company recorded a compound embedded derivative liability on its condensed consolidated balance sheets with a corresponding debt discount that is netted against the face value of the 2013 8.00% Notes. The Company determined the fair value of the compound embedded derivative liability using a blend of a Monte Carlo simulation model and market prices. 

Compound Embedded Derivative with the Amended and Restated Thermo Loan Agreement

As a result of the conversion option and the contingent put feature within the Thermo Loan Agreement, the Company recorded a compound embedded derivative liability on its condensed consolidated balance sheets with a corresponding debt discount that is netted against the face value of the Amended and Restated Loan Agreement. The Company determined the fair value of the compound embedded derivative liability using a blend of a Monte Carlo simulation model and market prices.

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Fair Value Measurements

6 Months Ended

Jun. 30, 2016

Fair Value Disclosures [Abstract]

Fair Value Measurements

FAIR VALUE MEASUREMENTS

The Company follows the authoritative guidance for fair value measurements relating to financial and non-financial assets and liabilities, including presentation of required disclosures herein. This guidance establishes a fair value framework requiring the categorization of assets and liabilities into three levels based upon the assumptions (inputs) used to price the assets and liabilities.  Level 1 provides the most reliable measure of fair value, whereas Level 3 generally requires significant management judgment.  The three levels are defined as follows:

Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities.

Level 2: Quoted prices in markets that are not active or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability. 

Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).

Recurring Fair Value Measurements

The following table provides a summary of the financial assets and liabilities measured at fair value on a recurring basis (in thousands): 

	June 30, 2016
	(Level 1)		(Level 2)			(Level 3)			Total  Balance
Assets:
Interest rate cap	$	—	$	1		$	—		$	1
Total assets measured at fair value	$	—	$	1		$	—		$	1
Liabilities:
Liability for potential stock issuance to Hughes	$	—	$	(7,418	)	$	—		$	(7,418	)
Compound embedded derivative with 2013 8.00% Notes	—		—			(20,420		)	(20,420		)
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	—		—			(180,062		)	(180,062		)
Total liabilities measured at fair value	$	—	$	(7,418	)	$	(200,482	)	$	(207,900	)

	December 31, 2015
	(Level 1)		(Level 2)			(Level 3)			Total  Balance
Assets:
Interest rate cap	$	—	$	6		$	—		$	6
Total assets measured at fair value	$	—	$	6		$	—		$	6
Liabilities:
Liability for potential stock issuance to Hughes	$	—	$	(5,495	)	$	—		$	(5,495	)
Compound embedded derivative with 2013 8.00% Notes	—		—			(26,203		)	(26,203		)
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	—		—			(213,439		)	(213,439		)
Total liabilities measured at fair value	$	—	$	(5,495	)	$	(239,642	)	$	(245,137	)

Assets 

Interest Rate Cap

The fair value of the interest rate cap is determined using observable pricing inputs including benchmark yields, reported trades, and broker/dealer quotes at the reporting date. See Note 4: Derivatives for further discussion.

Liabilities 

Liability for potential stock issuance to Hughes

The Company has one liability classified as Level 2. As described in Note 7: Commitments, the Company agreed to provide downside protection after the issuance of shares of common stock to Hughes in lieu of cash for contract payments in June 2015. This feature requires the Company to issue to Hughes additional shares of common stock equal to the difference, if any, between $15.5 million and the total amount of gross proceeds Hughes receives from the sale of any shares plus the market value of any shares still held by Hughes as of the close of trading on September 30, 2016. The value of this option is calculated using a Black-Scholes pricing model. This liability is marked-to-market at each balance sheet date and through the settlement date.

Derivative Liabilities

The Company has two derivative liabilities classified as Level 3. The Company marks-to-market these liabilities at each reporting date with the changes in fair value recognized in the Company’s condensed consolidated statements of operations. See Note 4: Derivatives for further discussion. 

The significant quantitative Level 3 inputs utilized in the valuation models are shown in the tables below: 

	June 30, 2016
	Stock Price Volatility	Risk-Free Interest Rate		Note Conversion Price		Market Price of Common Stock
Compound embedded derivative with the 2013 8.00% Notes	100% - 130%	0.5	%	$	0.73	$	1.21
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	40% - 130%	1.3	%	$	0.73	$	1.21

	December 31, 2015
	Stock Price Volatility	Risk-Free Interest Rate		Note Conversion Price		Market Price of Common Stock
Compound embedded derivative with 2013 8.00% Notes	75% - 90%	1.1	%	$	0.73	$	1.44
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	50% - 90%	2.1	%	$	0.73	$	1.44

Fluctuation in the Company’s stock price is the primary driver for the changes in the derivative valuations during each reporting period. As the stock price decreases towards the current conversion price for each of the related derivative instruments, the value to the holder of the instrument generally decreases, thereby decreasing the liability on the Company’s condensed consolidated balance sheets. These valuations are sensitive to the weighting applied to each of the simulated values. Additionally, stock price volatility is one of the significant unobservable inputs used in the fair value measurement of each of the Company’s derivative instruments. The simulated fair value of these liabilities is sensitive to changes in the expected volatility of the Company's stock price. Decreases in expected volatility would generally result in a lower fair value measurement. 

Probability of a change of control is another significant unobservable input used in the fair value measurement of the Company’s derivative instruments. Subject to certain restrictions in each indenture, the Company’s debt instruments contain certain provisions whereby holders may require the Company to purchase all or any portion of the convertible debt instrument upon a change of control. A change of control will occur upon certain changes in the ownership of the Company or certain events relating to the trading of the Company’s common stock. The simulated fair value of the derivative liabilities above is sensitive to changes in the assumed probabilities of a change of control. Decreases in the assumed probability of a change of control would generally result in a lower fair value measurement. 

In addition to the inputs described above, the valuation model used to calculate the fair value measurement of the compound embedded derivatives within the Company’s 2013 8.00% Notes and Thermo Loan Agreement included the following inputs and features: payment in kind interest payments, make whole premiums, a 40-day stock issuance settlement period upon conversion, automatic conversions, and the principal balance of each loan at the balance sheet date. There are also certain put and call features within the 2013 8.00% Notes that impact the valuation model. The trading activity in the market provides the Company with additional valuation support. The Company uses a weight factor to calculate the fair value of the embedded derivatives to align the fair value produced from the Monte Carlo simulation model with the market value of the 2013 8.00% Notes. Due to the similarities of the debt instruments, the Company applies a similar weight to the embedded derivative in the Thermo Loan Agreement. These valuations are sensitive to the weighting applied to each of the simulated values.

The following table presents a rollforward for all liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in thousands):

	Three months ended June 30,						Six months ended June 30,
	2016			2015			2016			2015
Balance at beginning of period	$	(240,982	)	$	(548,526	)	$	(239,642	)	$	(441,550	)
Derivative adjustment related to conversions	—			19,140			—			20,008
Unrealized gain, included in derivative gain	40,500			237,093			39,160			129,249
Balance at end of period	$	(200,482	)	$	(292,293	)	$	(200,482	)	$	(292,293	)

Fair Value of Debt Instruments

The Company believes it is not practicable to determine the fair value of the Facility Agreement. Unlike typical long-term debt, interest rates and other terms for the Facility Agreement are not readily available and generally involve a variety of factors, including due diligence by the debt holders. As such, it is not practicable to determine the fair value of the Facility Agreement without incurring significant additional costs. The following table sets forth the carrying values and estimated fair values of the Company's other debt instruments, which are classified as Level 3 financial instruments (in thousands):

	June 30, 2016				December 31, 2015
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Thermo Loan Agreement	$	57,264	$	29,207	$	50,664	$	17,244
2013 8.00% Notes	13,471		12,111		12,440		9,831

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Accrued Expenses and Other Non-Current Liabilities

6 Months Ended

Jun. 30, 2016

Payables and Accruals [Abstract]

Accrued Expenses and Other Non-Current Liabilities

ACCRUED EXPENSES AND OTHER NON-CURRENT LIABILITIES

Accrued expenses consist of the following (in thousands): 

	June 30, 2016		December 31, 2015
Accrued interest	$	319	$	317
Accrued compensation and benefits	2,927		2,098
Accrued property and other taxes	4,391		4,125
Accrued customer liabilities and deposits	3,336		3,216
Accrued professional and other service provider fees	2,401		1,830
Accrued commissions	969		1,216
Accrued telecommunications expenses	865		1,487
Accrued inventory	217		502
Accrued liability for potential stock issuance to Hughes	7,418		5,495
Accrued liability for legal settlement	1,422		328
Other accrued expenses	2,690		1,825
Total accrued expenses	$	26,955	$	22,439

Accrued liability for potential stock issuance to Hughes includes the estimated value at June 30, 2016 of the downside protection that the Company provided to Hughes in connection with its April 2015 agreement (as amended).  See Note 5: Fair Value Measurements and Note 7: Commitments for further discussion.

Other accrued expenses include primarily capital lease obligations, occupancy costs, payments to independent gateway operators ("IGOs") and estimated payroll shortfall under the Cooperative Endeavor Agreement with the Louisiana Department of Economic Development. 

Other non-current liabilities consist of the following (in thousands):   

	June 30, 2016		December 31, 2015
Long-term accrued interest	$	96	$	96
Asset retirement obligation	1,373		1,302
Deferred rent and other deferred expense	561		593
Liability related to the Cooperative Endeavor Agreement with the State of Louisiana	616		716
Uncertain income tax positions	6,352		5,795
Foreign tax contingencies	2,706		2,311
Capital lease obligations	227		94
Total other non-current liabilities	$	11,931	$	10,907

As a result of the expiration of the statute of limitations associated with the tax position of one of the Company's foreign subsidiaries, the Company anticipates removing the total position of $6.4 million in the Company’s unrecognized tax benefits, inclusive of cumulative interest and penalties, from its non-current liabilities during the quarter ending September 30, 2016.

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Commitments

6 Months Ended

Jun. 30, 2016

COMMITMENTS [Abstract]

Commitments

COMMITMENTS

Contractual Obligations - Second-Generation Satellites, Next-Generation Gateways and Other Ground Facilities 

As of June 30, 2016, the Company had purchase commitments with Thales, Hughes and Ericsson related to the procurement, deployment and maintenance of the second-generation network.  

Second-Generation Satellites

As of June 30, 2016, the Company had a contract with Thales for the construction of the Company’s second-generation low-earth orbit satellites and related services. The Company has successfully launched all of these second-generation satellites, excluding one on-ground spare. The Company and Thales have discussed the ownership of certain deliverables under this contract but have been unable to reach an agreement.

Effective October 24, 2014, the Company entered into a contract with Thales for in-orbit support services for the second-generation satellites delivered under the 2009 contract described in Note 2: Property and Equipment. These services will be performed over a three-year period for a total cost of approximately €1.9 million. A credit of €0.6 million was applied to the total cost, reducing the first annual payment to €0. This credit results from a settlement of amounts previously paid in conjunction with the 2009 contract.

Next-Generation Gateways and Other Ground Facilities

Hughes Network Systems

In May 2008, the Company entered into a contract with Hughes under which Hughes will design, supply and implement the Radio Access Network (RAN) ground network equipment and software upgrades for installation at a number of the Company’s satellite gateway ground stations and satellite interface chips to be used in various second-generation Globalstar devices.

In March 2015, the Company entered into an agreement with Hughes for the design, development, build, testing and delivery of four custom test equipment units for a total of $1.9 million. This test equipment was delivered during the fourth quarter of 2015. In April 2015, the Company extended the scope of work for delivery of two additional RANs for a total of $4.0 million. These RANs were delivered in February 2016. In July 2015, the Company and Hughes formally amended the contract to include the revised scope of work set forth in the March 2015 and April 2015 letter agreements.

In April 2015, Hughes exercised an option to be paid in shares of the Company's common stock (at a price 7% below market) in lieu of cash for certain of its remaining contract payments, including those related to the 2015 work mentioned above, totaling approximately $15.5 million. In June 2015, the Company issued 7.4 million shares of freely tradable common stock at the 7% discount pursuant to this option. The portion of these contract payments related to future milestone work is included in Prepaid second-generation ground costs on the condensed consolidated balance sheets as of June 30, 2016. As the contract milestones are achieved, the Company will reclassify the related costs from Prepaid second-generation ground costs to construction in progress within Property and equipment. In the April 2015 agreement (as amended), the Company agreed to provide downside protection through September 30, 2016. This feature requires that the Company issue additional shares of common stock equal to the difference, if any, between $15.5 million and the total amount of gross proceeds Hughes receives from the sale of any shares plus the market value of any shares still held by Hughes as of the close of trading on September 30, 2016. Pursuant to this agreement, the Company recorded a liability of $7.4 million as of June 30, 2016 and $5.5 million as of December 31, 2015, respectively. The Company calculated these estimates of the value of this option using a Black-Scholes pricing model. This liability is marked-to-market at each balance sheet date and through the settlement date. The Company records gains and losses resulting from changes in the value of this liability in its condensed consolidated statement of operations.

Ericsson

In October 2008, the Company entered into a contract with Ericsson to develop, implement and maintain a ground interface, or core network system, which will be installed at a number of the Company’s satellite gateway ground stations. In July 2014, the parties signed an amended and restated contract to specify the remaining contract value and a new milestone schedule to reflect a revised program timeline. Prior to the amended and restated contract being finalized, Ericsson and the Company agreed to defer certain milestone payments previously due under the 2008 contract to 2014 and beyond. The deferred payments were incurring interest at a rate of 6.5% per annum. In April 2015, the Company signed an amendment to the 2014 contract to incorporate certain changes in scope and timing identified as necessary by the parties. In conjunction with signing this amendment, the parties executed a new letter agreement under which Ericsson waived the remaining $1.0 million in deferred milestone payments and $0.4 million in interest accrued on the milestone payments under the 2008 contract. In the first quarter of 2015, the Company reversed these amounts from accounts payable, accrued expenses and construction in progress on the Company's condensed consolidated balance sheet. In August 2015, the Company and Ericsson executed a second amendment to the 2014 contract which incorporated revised payment and pricing schedules. This amendment also reflected an accelerated timeline for the project providing that the work was estimated to be completed in the second quarter, instead of the third quarter, of 2016. During the second quarter of 2016, the Company took possession of the final Ericsson hardware for the Company's global deployment. As of June 30, 2016, the remaining amount due under the contract is $6.0 million, which is related to the final acceptance of all contract deliverables.

Other Second-Generation Commitments

The Company has signed various licensing and royalty agreements necessary for the manufacture and distribution of its second-generation products. The Company will pay or has paid license fees for new product technology with royalty fees payable on a per unit basis as these units are manufactured, sold, or activated.

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Contingencies

6 Months Ended

Jun. 30, 2016

CONTINGENCIES [Abstract]

Contingencies

CONTINGENCIES

Arbitration 

On June 3, 2011, Globalstar filed a demand for arbitration against Thales before the American Arbitration Association to enforce certain rights to order additional satellites under the 2009 Contract. The Company did not include within its demand any claims that it had against Thales for work previously performed under the contract to design, manufacture and timely deliver the first 25 second-generation satellites. On May 10, 2012, the arbitration tribunal issued its award in which it determined that the Company had terminated the 2009 Contract "for convenience" and had materially breached the contract by failing to pay to Thales the €51.3 million in termination charges required under the contract. The tribunal additionally determined that absent further agreement between the parties, Thales had no further obligation to manufacture or deliver satellites under Phase 3 of the 2009 Contract. Based on these determinations, the tribunal directed the Company to pay Thales approximately €53 million in termination charges, plus interest by June 9, 2012. On May 23, 2012, Thales commenced an action in the United States District Court for the Southern District of New York by filing a petition to confirm the arbitration award (the “New York Proceeding”). Thales and the Company entered into a tolling agreement as of June 13, 2013, under which Thales dismissed the New York Proceeding without prejudice. The tolling agreement has expired. Thales may refile the petition at a later date and pursue the confirmation of the arbitration award, which the Company would oppose. Should Thales be successful in confirming the arbitration award, this would have a material adverse effect on the Company's financial condition, results of operations and liquidity.

On June 24, 2012, the Company and Thales agreed to settle their prior commercial disputes, including those disputes that were the subject of the arbitration award. In order to effectuate this settlement, the Company and Thales entered into a Release Agreement, a Settlement Agreement and a Submission Agreement. Under the terms of the Release Agreement, Thales agreed unconditionally and irrevocably to release and forever discharge the Company from any and all claims and obligations (with the exception of those items payable under the Settlement Agreement or in connection with a new contract for the purchase of any additional second-generation satellites), including, without limitation, a full release from paying €35.6 million of the termination charges awarded in the arbitration together with all interest on the award amount effective upon the earlier of December 31, 2012, and the effective date of the financing for the purchase of any additional second-generation satellites. Under the terms of the Release Agreement, the Company agreed unconditionally and irrevocably to release and forever discharge Thales from any and all claims (with limited exceptions), including, without limitation, claims related to Thales’ work under the 2009 satellite construction contract, including any obligation to pay liquidated damages, effective upon the earlier of December 31, 2012, and the effective date of the financing for the purchase of any additional second-generation satellites. In connection with the Release Agreement and the Settlement Agreement, the Company recorded a contract termination charge of approximately €17.5 million which is recorded in the Company’s condensed consolidated balance sheets as of June 30, 2016 and December 31, 2015. The releases became effective on December 31, 2012.

Under the terms of the Settlement Agreement, the Company agreed to pay €17.5 million to Thales, representing one-third of the termination charges awarded to Thales in the arbitration, subject to certain conditions, on the later of the effective date of the new contract for the purchase of any additional second-generation satellites and the effective date of the financing for the purchase of these satellites. As of June 30, 2016, this condition had not been satisfied. Because the effective date of the new contract for the purchase of additional second-generation satellites did not occur on or prior to February 28, 2013, any party may terminate the Settlement Agreement. If any party terminates the Settlement Agreement, all parties’ rights and obligations under the Settlement Agreement shall terminate. The Release Agreement is a separate and independent agreement from the Settlement Agreement and provides that it supersedes all prior understandings, commitments and representations between the parties with respect to the subject matter thereof; therefore it would survive any termination of the Settlement Agreement. As of June 30, 2016, no party had terminated the Settlement Agreement.

Litigation

Due to the nature of the Company's business, the Company is involved, from time to time, in various litigation matters or subject to disputes or routine claims regarding its business activities. Legal costs related to these matters are expensed as incurred. During the second quarter of 2016, the Company increased an accrual related to the settlement of litigation incurred on behalf of the Company's Brazilian subsidiary. As of June 30, 2016, the Company expects the total settlement to be 4.5 million reais, or $1.4 million, which will be paid in Globalstar common stock. In management's opinion, there is no pending litigation, dispute or claim, other than those described in this report, which could be expected to have a material adverse effect on the Company's financial condition, results of operations or liquidity.

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Related Party Transactions

6 Months Ended

Jun. 30, 2016

Related Party Transactions [Abstract]

Related Party Transactions

RELATED PARTY TRANSACTIONS

Payables to Thermo and other affiliates related to normal purchase transactions were $0.2 million and $0.6 million at each of June 30, 2016 and December 31, 2015, respectively. 

Transactions with Thermo

Expenses incurred by Thermo on behalf of the Company, including non-cash expenses and those expenses charged to the Company, were $0.2 million and $0.4 million during the three months ended June 30, 2016 and 2015, respectively and were $0.3 million and $0.5 million during the six months ended June 30, 2016 and 2015, respectively. Non-cash expenses, which the Company accounts for as a contribution to capital, relate to services provided by two executive officers of Thermo (who are also directors of the Company and receive no cash compensation from the Company). The Thermo expense charges are based on actual amounts (with no mark-up) incurred or upon allocated employee time. 

As of June 30, 2016, the principal amount outstanding under the Loan Agreement with Thermo was $88.4 million, and the fair value of the compound embedded derivative liability associated with the Loan Agreement was $180.1 million. For the three months ended June 30, 2016 and 2015, interest on the Loan Agreement was approximately $2.6 million and $2.2 million, respectively. For the six months ended June 30, 2016 and 2015, interest on the Loan Agreement was approximately $5.2 million and $4.2 million, respectively. In addition, as of June 30, 2016, warrants to purchase approximately 24.6 million shares issued under the Contingent Equity Agreement remain outstanding, all of which are held by Thermo and are scheduled to expire in June 2017. In June 2016, Thermo exercised warrants to purchase 5.6 million and 8.0 million shares of voting common stock related to the Contingent Equity Agreement and the Company's 5.0% Warrants, respectively. As a result of these warrant exercises, the Company received aggregate proceeds of $2.6 million in June 2016.

In August 2015, the Company entered into an Equity Agreement with Thermo. Thermo agreed to purchase up to $30.0 million in equity securities of the Company if the Company so requests or if an event of default is continuing under the Facility Agreement and funds are not available under the August 2015 Terrapin Agreement. As of June 30, 2016, the Company has received cash equity financing in excess of Thermo's equity commitment. This cash equity financing primarily includes draws under the August 2015 Terrapin Agreement in August 2015, February 2016, and June 2016 for $15.0 million, $6.5 million, and $22.0 million, respectively. As a result, Thermo had no remaining cash equity commitment under the Equity Agreement as of June 30, 2016.

The Facility Agreement requires Thermo to maintain minimum and maximum ownership levels in the Company's common stock. Thermo may convert shares of nonvoting common stock into shares of voting common stock as needed to comply with these ownership limitations.

See Note 3: Long-Term Debt and Other Financing Arrangements and Note 4: Derivatives for further discussion of the Company's debt and financing transactions with Thermo.

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Accumulated Other Comprehensive Income (Loss)

6 Months Ended

Jun. 30, 2016

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated Other Comprehensive Income (Loss)

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) 

Accumulated other comprehensive income (loss) includes all changes in equity during a period from non-owner sources.

The components of accumulated other comprehensive income (loss) were as follows (in thousands): 

	Three Months Ended June 30,						Six Months Ended June 30,
	2016			2015			2016			2015
Accumulated other comprehensive loss, beginning of period	$	(5,484	)	$	(4,188	)	$	(4,833	)	$	(2,898	)
Other comprehensive income (loss):
Foreign currency translation adjustments	(925		)	447			(1,576		)	(843		)
Accumulated other comprehensive loss, end of period	$	(6,409	)	$	(3,741	)	$	(6,409	)	$	(3,741	)

No amounts were reclassified out of accumulated other comprehensive loss for the periods shown above.

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Geographic Information

6 Months Ended

Jun. 30, 2016

Segment Reporting [Abstract]

Geographic Information

GEOGRAPHIC INFORMATION

The Company attributes subscriber equipment sales to various countries based on the location where equipment is sold. Service revenue is generally attributed to the various countries based on the Globalstar entity that holds the customer contract. Property and equipment is attributed to the various countries based on the physical location of the asset at the end of a given period, except for the Company's satellites that are included in the property and equipment of the United States. The Company’s information by geographic area is as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2016		2015		2016		2015
Revenues:
Service revenue:
United States	$	14,407	$	12,468	$	27,676	$	24,183
Canada	4,066		3,771		7,310		7,204
Europe	1,805		1,541		3,263		2,743
Central and South America	570		688		1,188		1,302
Others	122		148		282		291
Total service revenue	$	20,970	$	18,616	$	39,719	$	35,723
Subscriber equipment sales:
United States	2,226		1,990		3,530		3,578
Canada	1,052		1,278		1,813		2,439
Europe	527		452		956		985
Central and South America	279		424		667		1,057
Others	32		263		237		263
Total subscriber equipment sales	$	4,116	$	4,407	$	7,203	$	8,322
Total revenue	$	25,086	$	23,023	$	46,922	$	44,045

	June 30, 2016		December 31, 2015
Property and equipment, net:
United States	$	1,054,493	$	1,073,327
Canada	626		510
Europe	454		484
Central and South America	3,126		2,782
Others	320		457
Total property and equipment, net	$	1,059,019	$	1,077,560

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Earnings (Loss) Per Share

6 Months Ended

Jun. 30, 2016

Earnings Per Share [Abstract]

Earnings (Loss) Per Share

EARNINGS (LOSS) PER SHARE

Basic earnings (loss) per share are computed based on the weighted average number of shares of common stock outstanding during the period. Common stock equivalents are included in the calculation of diluted earnings per share only when the effect of their inclusion would be dilutive. 

The following table sets forth the calculation of basic and diluted earnings (loss) per share for the periods indicated (in thousands):

	Three Months Ended   June 30,				Six Months Ended   June 30,
	2016		2015		2016			2015
Net income (loss)	$	14,099	$	204,767	$	(12,848	)	$	75,040
Effect of dilutive securities:
2013 8.00% Notes	537		593		—			1,313
Thermo Loan Agreement	2,401		2,148		—			4,251
Income (loss) to common stockholders plus assumed conversions	$	17,037	$	207,508	$	(12,848	)	$	80,604
Weighted average common shares outstanding:
Basic shares outstanding	1,049,381		1,009,917		1,045,205			1,005,406
Incremental shares from assumed exercises, conversions and other issuances:
Stock options, restricted stock, restricted stock units and ESPP	5,793		8,667		—			8,534
2013 8.00% Notes	27,164		28,001		—			27,778
Thermo Loan Agreement	139,709		120,673		—			119,272
Warrants and other	27,625		38,192		—			38,192
Diluted shares outstanding	1,249,672		1,205,450		1,045,205			1,199,182
Income (loss) per share:
Basic	0.01		0.20		(0.01		)	0.07
Diluted	0.01		0.17		(0.01		)	0.07

For the six months ended June 30, 2016, 197.0 million shares of potential common stock were excluded from diluted shares outstanding because the effects of assuming issuance of these potentially dilutive securities would be anti-dilutive.

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Condensed Consolidating Financial Information

6 Months Ended

Jun. 30, 2016

SUPPLEMENTAL CONSOLIDATING FINANCIAL INFORMATION [Abstract]

Condensed Consolidating Financial Information

CONDENSED CONSOLIDATING FINANCIAL INFORMATION

In connection with the Company’s issuance of the 2013 8.00% Notes, certain of the Company’s 100% owned domestic subsidiaries (the “Guarantor Subsidiaries”), fully, unconditionally, jointly, and severally guaranteed the payment obligations under the 2013 8.00% Notes. The following financial information sets forth, on a consolidating basis, the balance sheets, statements of operations and statements of cash flows for Globalstar, Inc. (“Parent Company”), for the Guarantor Subsidiaries and for the Parent Company’s other subsidiaries (the “Non-Guarantor Subsidiaries”).   

The condensed consolidating financial information has been prepared pursuant to the rules and regulations for condensed financial information and does not include disclosures included in annual financial statements. The principal eliminating entries eliminate investments in subsidiaries, intercompany balances and intercompany revenues and expenses. 

Globalstar, Inc.

Condensed Consolidating Statement of Operations

Three Months Ended June 30, 2016

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
Revenue:
Service revenues	$	10,944		$	10,863		$	10,689		$	(11,526	)	$	20,970
Subscriber equipment sales	96			2,774			1,997			(751		)	4,116
Total revenue	11,040			13,637			12,686			(12,277		)	25,086
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	5,135			1,034			2,702			(934		)	7,937
Cost of subscriber equipment sales	43			2,112			1,478			(747		)	2,886
Marketing, general and administrative	5,430			1,322			16,219			(11,521		)	11,450
Depreciation, amortization, and accretion	18,851			206			288			(121		)	19,224
Total operating expenses	29,459			4,674			20,687			(13,323		)	41,497
Income (loss) from operations	(18,419		)	8,963			(8,001		)	1,046			(16,411		)
Other income (expense):
Loss on equity issuance	(2,075		)	—			—			—			(2,075		)
Interest income and expense, net of amounts capitalized	(9,000		)	(3		)	(47		)	1			(9,049		)
Derivative gain	40,499			—			—			—			40,499
Equity in subsidiary earnings (loss)	2,924			(968		)	—			(1,956		)	—
Other	170			92			328			95			685
Total other income (expense)	32,518			(879		)	281			(1,860		)	30,060
Income (loss) before income taxes	14,099			8,084			(7,720		)	(814		)	13,649
Income tax benefit	—			—			(450		)	—			(450		)
Net income (loss)	$	14,099		$	8,084		$	(7,270	)	$	(814	)	$	14,099
Comprehensive income (loss)	$	14,099		$	8,084		$	(8,195	)	$	(814	)	$	13,174

Globalstar, Inc.

Condensed Consolidating Statement of Operations

Three Months Ended June 30, 2015

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
Revenue:
Service revenues	$	15,932		$	6,865		$	11,213		$	(15,394	)	$	18,616
Subscriber equipment sales	296			2,615			2,993			(1,497		)	4,407
Total revenue	16,228			9,480			14,206			(16,891		)	23,023
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	4,969			1,652			3,037			(1,631		)	8,027
Cost of subscriber equipment sales	78			2,137			3,286			(2,518		)	2,983
Marketing, general and administrative	4,940			1,832			16,561			(13,174		)	10,159
Depreciation, amortization, and accretion	18,778			293			329			(129		)	19,271
Total operating expenses	28,765			5,914			23,213			(17,452		)	40,440
Income (loss) from operations	(12,537		)	3,566			(9,007		)	561			(17,417		)
Other income (expense):
Loss on extinguishment of debt	(2,189		)	—			—			—			(2,189		)
Loss on equity issuance	(2,912		)	—			—			—			(2,912		)
Interest income and expense, net of amounts capitalized	(9,107		)	(5		)	(138		)	6			(9,244		)
Derivative gain	237,087			—			—			—			237,087
Equity in subsidiary earnings (loss)	(5,035		)	1,161			—			3,874			—
Other	(674		)	(132		)	355			(1		)	(452		)
Total other income (expense)	217,170			1,024			217			3,879			222,290
Income (loss) before income taxes	204,633			4,590			(8,790		)	4,440			204,873
Income tax expense (benefit)	(134		)	(8		)	248						106
Net income (loss)	$	204,767		$	4,598		$	(9,038	)	$	4,440		$	204,767
Comprehensive income (loss)	$	204,767		$	4,598		$	(8,591	)	$	4,440		$	205,214

Globalstar, Inc.

Condensed Consolidating Statement of Operations

Six Months Ended June 30, 2016

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
Revenue:
Service revenues	$	27,882		$	18,358		$	20,114		$	(26,635	)	$	39,719
Subscriber equipment sales	424			4,466			3,674			(1,361		)	7,203
Total revenue	28,306			22,824			23,788			(27,996		)	46,922
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	9,948			2,070			5,597			(2,087		)	15,528
Cost of subscriber equipment sales	187			3,540			2,693			(1,356		)	5,064
Marketing, general and administrative	10,604			1,854			33,064			(25,462		)	20,060
Depreciation, amortization, and accretion	37,623			426			569			(239		)	38,379
Total operating expenses	58,362			7,890			41,923			(29,144		)	79,031
Income (loss) from operations	(30,056		)	14,934			(18,135		)	1,148			(32,109		)
Other income (expense):
Loss on equity issuance	(1,923		)	—			—			—			(1,923		)
Interest income and expense, net of amounts capitalized	(17,981		)	(12		)	(152		)	(9		)	(18,154		)
Derivative gain	39,155			—			—			—			39,155
Equity in subsidiary earnings (loss)	(1,427		)	2,079			—			(652		)	—
Other	(616		)	(112		)	604			48			(76		)
Total other income (expense)	17,208			1,955			452			(613		)	19,002
Income (loss) before income taxes	(12,848		)	16,889			(17,683		)	535			(13,107		)
Income tax benefit	—			—			(259		)	—			(259		)
Net income (loss)	$	(12,848	)	$	16,889		$	(17,424	)	$	535		$	(12,848	)
Comprehensive income (loss)	$	(12,848	)	$	16,889		$	(19,000	)	$	535		$	(14,424	)

Globalstar, Inc.

Condensed Consolidating Statement of Operations

Six Months Ended June 30, 2015

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
Revenue:
Service revenues	$	32,175		$	14,543		$	20,020		$	(31,015	)	$	35,723
Subscriber equipment sales	354			6,064			5,491			(3,587		)	8,322
Total revenue	32,529			20,607			25,511			(34,602		)	44,045
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	9,504			3,177			6,289			(3,509		)	15,461
Cost of subscriber equipment sales	60			5,443			5,732			(5,121		)	6,114
Marketing, general and administrative	9,449			2,991			32,305			(25,990		)	18,755
Depreciation, amortization, and accretion	37,327			591			652			(253		)	38,317
Total operating expenses	56,340			12,202			44,978			(34,873		)	78,647
Income (loss) from operations	(23,811		)	8,405			(19,467		)	271			(34,602		)
Other income (expense):
Loss on extinguishment of debt	(2,254		)	—			—			—			(2,254		)
Loss on equity issuance	(2,912		)	—			—			—			(2,912		)
Interest income and expense, net of amounts capitalized	(17,443		)	(15		)	(309		)	6			(17,761		)
Derivative gain	129,222			—			—			—			129,222
Equity in subsidiary earnings (loss)	(8,949		)	5,426			—			3,523			—
Other	1,132			394			2,102			53			3,681
Total other income (expense)	98,796			5,805			1,793			3,582			109,976
Income (loss) before income taxes	74,985			14,210			(17,674		)	3,853			75,374
Income tax expense (benefit)	(55		)	15			374			—			334
Net income (loss)	$	75,040		$	14,195		$	(18,048	)	$	3,853		$	75,040
Comprehensive income (loss)	$	75,040		$	14,195		$	(18,891	)	$	3,853		$	74,197

Globalstar, Inc.

Condensed Consolidating Balance Sheet

As of June 30, 2016

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	7,640		$	807		$	2,822		$	—		$	11,269
Accounts receivable	5,925			6,022			4,217			—			16,164
Intercompany receivables	869,736			644,878			63,659			(1,578,273		)	—
Inventory	2,128			5,058			2,512			—			9,698
Prepaid expenses and other current assets	2,393			330			2,307			—			5,030
Total current assets	887,822			657,095			75,517			(1,578,273		)	42,161
Property and equipment, net	1,051,013			3,479			4,649			(122		)	1,059,019
Restricted cash	37,918			—			—			—			37,918
Intercompany notes receivable	10,717			—			16,295			(27,012		)	—
Investment in subsidiaries	(272,351		)	23,009			34,404			214,938			—
Prepaid second-generation ground costs	4,165			—			—			—			4,165
Intangible and other assets, net	12,739			200			568			(10		)	13,497
Total assets	$	1,732,023		$	683,783		$	131,433		$	(1,390,479	)	$	1,156,760
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	38,112		$	—		$	—		$	—		$	38,112
Accounts payable	2,360			2,571			1,108			—			6,039
Accrued contract termination charge	19,468			—			—			—			19,468
Accrued expenses	13,378			6,047			7,530			—			26,955
Intercompany payables	620,440			725,974			241,038			(1,587,452		)	—
Payables to affiliates	240			—			—			—			240
Deferred revenue	2,007			17,691			5,527			—			25,225
Total current liabilities	696,005			752,283			255,203			(1,587,452		)	116,039
Long-term debt, less current portion	540,350			—			—			—			540,350
Employee benefit obligations	4,894			—			—			—			4,894
Intercompany notes payable	6,004			—			12,860			(18,864		)	—
Derivative liabilities	200,482			—			—			—			200,482
Deferred revenue	5,834			291			—			—			6,125
Debt restructuring fees	20,795			—			—			—			20,795
Other non-current liabilities	1,515			315			10,101			—			11,931
Total non-current liabilities	779,874			606			22,961			(18,864		)	784,577
Stockholders’ equity (deficit)	256,144			(69,106		)	(146,731		)	215,837			256,144
Total liabilities and stockholders’ equity	$	1,732,023		$	683,783		$	131,433		$	(1,390,479	)	$	1,156,760

Globalstar, Inc.

Condensed Consolidating Balance Sheet

As of December 31, 2015

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	3,530		$	719		$	3,227		$	—		$	7,476
Accounts receivable	4,521			5,215			4,461			339			14,536
Intercompany receivables	859,370			465,488			34,742			(1,359,600		)	—
Inventory	2,148			6,321			3,554			—			12,023
Prepaid expenses and other current assets	2,399			291			1,766			—			4,456
Total current assets	871,968			478,034			47,750			(1,359,261		)	38,491
Property and equipment, net	1,069,605			3,722			4,587			(354		)	1,077,560
Restricted cash	37,918			—			—			—			37,918
Intercompany notes receivable	12,037			—			14,994			(27,031		)	—
Investment in subsidiaries	(298,976		)	9,512			32,946			256,518			—
Prepaid second-generation ground costs	8,929			—			—			—			8,929
Intangible and other assets, net	11,384			280			464			(11		)	12,117
Total assets	$	1,712,865		$	491,548		$	100,741		$	(1,130,139	)	$	1,175,015
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	32,835		$	—		$	—		$	—		$	32,835
Accounts payable	4,292			2,439			1,387			—			8,118
Accrued contract termination charge	19,121			—			—			—			19,121
Accrued expenses	9,816			6,949			5,674			—			22,439
Intercompany payables	580,383			604,999			179,105			(1,364,487		)	—
Payables to affiliates	616			—			—			—			616
Deferred revenue	1,980			17,722			4,200			—			23,902
Total current liabilities	649,043			632,109			190,366			(1,364,487		)	107,031
Long-term debt, less current portion	548,286			—			—			—			548,286
Employee benefit obligations	4,810			—			—			—			4,810
Intercompany notes payable	5,564			—			13,970			(19,534		)	—
Derivative liabilities	239,642			—			—			—			239,642
Deferred revenue	6,027			386			—			—			6,413
Debt restructuring fees	20,795			—			—			—			20,795
Other non-current liabilities	1,567			305			9,035			—			10,907
Total non-current liabilities	826,691			691			23,005			(19,534		)	830,853
Stockholders’ equity (deficit)	237,131			(141,252		)	(112,630		)	253,882			237,131
Total liabilities and stockholders’ equity	$	1,712,865		$	491,548		$	100,741		$	(1,130,139	)	$	1,175,015

Globalstar, Inc.

Condensed Consolidating Statement of Cash Flows

Six Months Ended June 30, 2016

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations		Consolidated
	(In thousands)
Cash flows provided by (used in) operating activities	$	916		$	255		$	(170	)	$	—	$	1,001
Cash flows used in investing activities:
Second-generation network costs (including interest)	(5,161		)	—			(146		)	—		(5,307		)
Property and equipment additions	(5,937		)	(167		)	(241		)	—		(6,345		)
Purchase of intangible assets	(806		)	—			—			—		(806		)
Net cash used in investing activities	(11,904		)	(167		)	(387		)	—		(12,458		)
Cash flows provided by (used in) financing activities:
Principal payments of the Facility Agreement	(16,418		)	—			—			—		(16,418		)
Proceeds from issuance of stock to Terrapin	28,500			—			—			—		28,500
Proceeds from issuance of common stock and exercise of options and warrants	3,016			—			—			—		3,016
Net cash provided by financing activities	15,098			—			—			—		15,098
Effect of exchange rate changes on cash	—			—			152			—		152
Net increase (decrease) in cash and cash equivalents	4,110			88			(405		)	—		3,793
Cash and cash equivalents, beginning of period	3,530			719			3,227			—		7,476
Cash and cash equivalents, end of period	$	7,640		$	807		$	2,822		$	—	$	11,269

Globalstar, Inc.

Condensed Consolidating Statement of Cash Flows

Six Months Ended June 30, 2015

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations		Consolidated
	(In thousands)
Cash flows provided by (used in) operating activities	$	(3,451	)	$	1,239		$	950		$	—	$	(1,262	)
Cash flows used in investing activities:
Second-generation network costs (including interest)	(10,344		)	—			—			—		(10,344		)
Property and equipment additions	(636		)	(1,452		)	(237		)	—		(2,325		)
Purchase of intangible assets	(1,343		)									(1,343		)
Net cash used in investing activities	(12,323		)	(1,452		)	(237		)	—		(14,012		)
Cash flows provided by (used in) financing activities:
Principal payments of the Facility Agreement	(3,225		)									(3,225		)
Proceeds from issuance of stock to Terrapin	24,000			—			—			—		24,000
Proceeds from issuance of common stock and exercise of options and warrants	419			—			—			—		419
Net cash provided by financing activities	21,194			—			—			—		21,194
Effect of exchange rate changes on cash	—			—			(170		)	—		(170		)
Net increase (decrease) in cash and cash equivalents	5,420			(213		)	543			—		5,750
Cash and cash equivalents, beginning of period	3,166			672			3,283			—		7,121
Cash and cash equivalents, end of period	$	8,586		$	459		$	3,826		$	—	$	12,871

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Basis of Presentation (Policies)

6 Months Ended

Jun. 30, 2016

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of presentation

Globalstar, Inc. (“Globalstar” or the “Company”) provides Mobile Satellite Services (“MSS”) including voice and data communications services through its global satellite network. Thermo Capital Partners LLC, through its affiliates (collectively, “Thermo”), is the principal owner and largest stockholder of Globalstar. The Company’s Chairman and Chief Executive Officer controls Thermo. Two other members of the Company's Board of Directors are also directors, officers or minority equity owners of various Thermo entities.

The Company has prepared the accompanying unaudited interim condensed consolidated financial statements in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information. Certain information and footnote disclosures normally in financial statements have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"); however, management believes the disclosures made are adequate to make the information presented not misleading. These financial statements and notes should be read in conjunction with the consolidated financial statements and notes thereto included in the Globalstar Annual Report on Form 10-K for the year ended December 31, 2015, as filed with the SEC on February 26, 2016 (the "2015 Annual Report"), and Management's Discussion and Analysis of Financial Condition and Results of Operations herein. 

The preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from estimates. The Company evaluates estimates on an ongoing basis. Significant estimates include the value of derivative instruments, the allowance for doubtful accounts, the net realizable value of inventory, the useful life and value of property and equipment, the value of stock-based compensation and income taxes. The Company has made certain reclassifications to prior period condensed consolidated financial statements to conform to current period presentation.

These unaudited interim condensed consolidated financial statements include the accounts of Globalstar and all its subsidiaries. All significant intercompany transactions and balances have been eliminated in the consolidation. In the opinion of management, the information included herein includes all adjustments, consisting of normal recurring adjustments, that are necessary for a fair presentation of the Company’s condensed consolidated statements of operations, condensed consolidated balance sheets, and condensed consolidated statements of cash flows for the periods presented. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results that may be expected for the full year or any future period.

Recently issued accounting pronouncements

Recently Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers. ASU No. 2014-09 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. This ASU requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In August 2015, the FASB decided to delay the effective date of ASU No. 2014-09. With the one-year deferral, ASU No. 2014-09 is now effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. Additionally, early adoption is now permitted. However, entities reporting under U.S. GAAP are not permitted to adopt the standard earlier than the original effective date of December 15, 2016. The standard permits the use of either the retrospective or cumulative effect transition method. In March 2016, the FASB issued ASU No. 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net), which does not change the core principle of the guidance in ASU No. 2014-09 but clarifies the implementation guidance on principal versus agent considerations. The effective date and transition requirements for ASU No. 2016-08 are the same as those of ASU No. 2014-09. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing, which amends the guidance on accounting for licenses of intellectual property and identifying performance obligations in its new revenue standard. In May 2016, the FASB issued ASU No. 2016-12 Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients, whichis intended to reduce the cost and complexity of applying the new revenue standard and result in more consistent application. The Company is currently evaluating the impact that these standards will have on its financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of these standards on its ongoing reporting.

In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory. ASU No. 2015-11 requires that inventory within the scope of the guidance be measured at the lower of cost and net realizable value. Inventory measured using last-in, first-out (LIFO) and retail inventory method (RIM) are excluded from this new guidance. This ASU replaces the concept of market with the single measurement of net realizable value and is intended to create efficiencies for preparers and more closely align U.S. GAAP with IFRS. This ASU is effective for public business entities in fiscal years, and interim periods within those years, beginning after December 15, 2016. Prospective application is required and early adoption is permitted as of the beginning of an interim or annual reporting period. The Company is currently evaluating the impact this standard will have on its financial statements and related disclosures, but does not expect this ASU to have a material effect on its consolidated financial statements and related disclosures.

In November 2015, the FASB issued ASU. No. 2015-17, Balance Sheet Classification of Deferred Taxes. ASU No. 2015-17 simplifies the presentation of deferred taxes on the balance sheet by requiring classification of all deferred tax items as noncurrent including valuation allowances by jurisdiction. The ASU is effective for public entities for annual and interim periods beginning after December 15, 2016. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company is currently evaluating the impact this standard will have on its financial statements and related disclosures, but does not expect the effect to be material.

In March 2016, the FASB issued ASU No. 2016-02, Leases. The main difference between the provisions of ASU No. 2016-02 and previous U.S. GAAP is the recognition of right-of-use assets and lease liabilities by lessees for those leases classified as operating leases under previous U.S. GAAP. ASU No. 2016-02 retains a distinction between finance leases and operating leases, and the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from previous U.S. GAAP. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize right-of-use assets and lease liabilities. The accounting applied by a lessor is largely unchanged from that applied under previous U.S. GAAP. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. This ASU is effective for public business entities in fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company has not yet determined the effect of the standard on its ongoing reporting.

In March 2016, the FASB issued ASU No. 2016-04, Liabilities-Extinguishment of Liabilities: Recognition of Breakage for Certain Prepaid Stored-Value Products. ASU No. 2016-04 contains specific guidance for the derecognition of prepaid stored-value product liabilities within the scope of this ASU. This ASU is effective for public entities for annual and interim periods beginning after December 15, 2017. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company does not expect this ASU to have a material effect on its consolidated financial statements and related disclosures.

In March 2016, the FASB issued ASU. No. 2016-06, Derivatives and Hedging: Contingent Put and Call Options in Debt Instruments. ASU No. 2016-06 clarifies the requirements for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. This ASU is effective for public entities for annual and interim periods beginning after December 15, 2016. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company has not yet determined the effect of this standard on its ongoing reporting.

In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation. ASU No. 2016-09 simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. This ASU is effective for public business entities for annual and interim periods beginning after December 15, 2016. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company has not yet determined the effect of this standard on its ongoing reporting.

In June 2016, the FASB issued ASU No. 2016-13, Credit Losses, Measurement of Credit Losses on Financial Instruments. ASU No. 2016-13 significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The standard will replace today’s incurred loss approach with an expected loss model for instruments measured at amortized cost. Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. This ASU is effective for public entities for annual and interim periods beginning after December 15, 2019. Early adoption is permitted for all entities for annual periods beginning after December 15, 2018, and interim periods therein. The Company has not yet determined the effect of this standard on its ongoing reporting.

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Property and Equipment (Tables)

6 Months Ended

Jun. 30, 2016

Property, Plant and Equipment [Abstract]

Property and equipment

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

	June 30, 2016			December 31, 2015
Globalstar System:
Space component
First and second-generation satellites in service	$	1,211,226		$	1,211,768
Prepaid long-lead items	17,040			17,040
Second-generation satellite, on-ground spare	32,481			32,481
Ground component	48,184			46,870
Construction in progress:
Space component	81			81
Ground component	190,328			177,780
Next-generation software upgrades	8,435			3,440
Other	2,375			2,153
Total Globalstar System	1,510,150			1,491,613
Internally developed and purchased software	14,753			14,492
Equipment	11,996			10,802
Land and buildings	3,343			3,151
Leasehold improvements	1,731			1,671
Total property and equipment	1,541,973			1,521,729
Accumulated depreciation	(482,954		)	(444,169		)
Total property and equipment, net	$	1,059,019		$	1,077,560

Capitalized interest

The following table summarizes capitalized interest (in thousands):   

	Three Months Ended   June 30,						Six Months Ended   June 30,
	2016			2015			2016			2015
Interest costs eligible to be capitalized	$	11,947		$	10,589		$	23,792		$	20,705
Interest costs recorded in interest income (expense), net	(8,565		)	(8,125		)	(17,144		)	(16,049		)
Net interest capitalized	$	3,382		$	2,464		$	6,648		$	4,656

Depreciation expense

The following table summarizes depreciation expense (in thousands): 

	Three Months Ended   June 30,				Six Months Ended   June 30,
	2016		2015		2016		2015
Depreciation expense	$	19,118	$	19,127	$	38,168	$	38,030

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Long-Term Debt and Other Financing Arrangements (Tables)

6 Months Ended

Jun. 30, 2016

Debt Disclosure [Abstract]

Schedule of long-term debt

Long-term debt consists of the following (in thousands): 

	June 30, 2016						December 31, 2015
	Principal Amount		Unamortized Discount and Deferred Financing Costs		Carrying Value		Principal Amount		Unamortized Discount and Deferred Financing Costs		Carrying Value
Facility Agreement	$	559,429	$	51,702	$	507,727	$	575,846	$	57,829	$	518,017
Thermo Loan Agreement	88,400		31,136		57,264		83,222		32,558		50,664
8.00% Convertible Senior Notes Issued in 2013	16,936		3,465		13,471		16,747		4,307		12,440
Total Debt	664,765		86,303		578,462		675,815		94,694		581,121
Less: Current Portion	38,112		—		38,112		32,835		—		32,835
Long-Term Debt	$	626,653	$	86,303	$	540,350	$	642,980	$	94,694	$	548,286

Summary of warrants outstanding

Warrants are outstanding to purchase shares of common stock as shown in the table below: 

	Outstanding Warrants		Strike Price
	June 30, 2016	December 31, 2015	June 30, 2016		December 31, 2015
Contingent Equity Agreement (1)	24,571,428	30,191,866	$	0.01	$	0.01
5.0% Warrants (2)	—	8,000,000	—		0.32
	24,571,428	38,191,866

(1) Pursuant to the terms of the Contingent Equity Agreement with Thermo (See Note 9: Related Party Transactions in the Consolidated Financial Statements in the 2015 Annual Report for a description of the Contingent Equity Agreement), the Company issued to Thermo warrants to purchase shares of common stock pursuant to the annual availability fee and subsequent reset provisions in the Contingent Equity Agreement. These warrants were issued between June 2009 and June 2012 and have a five-year exercise period from issuance. As of June 30, 2016, Thermo had exercised warrants to purchase approximately 16.9 million of these shares prior to the expiration of the associated warrants. In June 2016, Thermo exercised warrants to purchase 5.6 million shares of voting common stock for a total purchase price of $0.1 million. The exercise period for the remaining outstanding warrants expires in June 2017.

(2) In June 2011, the Company issued warrants (the “5.0% Warrants”) to purchase 15.2 million shares of its voting common stock in connection with the issuance of its 5.0% Convertible Senior Unsecured Notes. In June 2016, Thermo exercised all of the remaining warrants outstanding to purchase 8.0 million shares of voting common stock for a total purchase price of $2.5 million. See Note 3: Long-Term Debt and Other Financing Arrangements in the Consolidated Financial Statements in the 2015 Annual Report for a complete description of the 5.0% Warrants.

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Derivatives (Tables)

6 Months Ended

Jun. 30, 2016

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of fair values of derivative instruments

The following tables disclose the fair values of the derivative instruments on the Company’s condensed consolidated balance sheets (in thousands):

	June 30, 2016			December 31, 2015
Derivative assets:
Interest rate cap	$	1		$	6
Total derivative assets	$	1		$	6
Derivative liabilities:
Compound embedded derivative with 2013 8.00% Notes	$	(20,420	)	$	(26,203	)
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	(180,062		)	(213,439		)
Total derivative liabilities	$	(200,482	)	$	(239,642	)

Schedule of derivative gains (losses)

The following table discloses the changes in value recorded as derivative gain (loss) in the Company’s condensed consolidated statement of operations (in thousands): 

	Three Months Ended						Six Months Ended
	June 30, 2016			June 30, 2015			June 30, 2016			June 30, 2015
Interest rate cap	$	(1	)	$	(6	)	$	(5	)	$	(27	)
Compound embedded derivative with 2013 8.00% Notes	5,335			37,928			5,783			18,892
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	35,165			199,165			33,377			110,357
Total derivative gain	$	40,499		$	237,087		$	39,155		$	129,222

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Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2016

Fair Value Disclosures [Abstract]

Financial assets and liabilities measured at fair value on recurring basis

The following table provides a summary of the financial assets and liabilities measured at fair value on a recurring basis (in thousands): 

	June 30, 2016
	(Level 1)		(Level 2)			(Level 3)			Total  Balance
Assets:
Interest rate cap	$	—	$	1		$	—		$	1
Total assets measured at fair value	$	—	$	1		$	—		$	1
Liabilities:
Liability for potential stock issuance to Hughes	$	—	$	(7,418	)	$	—		$	(7,418	)
Compound embedded derivative with 2013 8.00% Notes	—		—			(20,420		)	(20,420		)
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	—		—			(180,062		)	(180,062		)
Total liabilities measured at fair value	$	—	$	(7,418	)	$	(200,482	)	$	(207,900	)

	December 31, 2015
	(Level 1)		(Level 2)			(Level 3)			Total  Balance
Assets:
Interest rate cap	$	—	$	6		$	—		$	6
Total assets measured at fair value	$	—	$	6		$	—		$	6
Liabilities:
Liability for potential stock issuance to Hughes	$	—	$	(5,495	)	$	—		$	(5,495	)
Compound embedded derivative with 2013 8.00% Notes	—		—			(26,203		)	(26,203		)
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	—		—			(213,439		)	(213,439		)
Total liabilities measured at fair value	$	—	$	(5,495	)	$	(239,642	)	$	(245,137	)

Schedule of significant quantitative level 3 inputs utilized

The significant quantitative Level 3 inputs utilized in the valuation models are shown in the tables below: 

	June 30, 2016
	Stock Price Volatility	Risk-Free Interest Rate		Note Conversion Price		Market Price of Common Stock
Compound embedded derivative with the 2013 8.00% Notes	100% - 130%	0.5	%	$	0.73	$	1.21
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	40% - 130%	1.3	%	$	0.73	$	1.21

	December 31, 2015
	Stock Price Volatility	Risk-Free Interest Rate		Note Conversion Price		Market Price of Common Stock
Compound embedded derivative with 2013 8.00% Notes	75% - 90%	1.1	%	$	0.73	$	1.44
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement	50% - 90%	2.1	%	$	0.73	$	1.44

Rollforward of liabilities measured at fair value

The following table presents a rollforward for all liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in thousands):

	Three months ended June 30,						Six months ended June 30,
	2016			2015			2016			2015
Balance at beginning of period	$	(240,982	)	$	(548,526	)	$	(239,642	)	$	(441,550	)
Derivative adjustment related to conversions	—			19,140			—			20,008
Unrealized gain, included in derivative gain	40,500			237,093			39,160			129,249
Balance at end of period	$	(200,482	)	$	(292,293	)	$	(200,482	)	$	(292,293	)

Schedule of carrying values and estimated fair values of debt instruments

The following table sets forth the carrying values and estimated fair values of the Company's other debt instruments, which are classified as Level 3 financial instruments (in thousands):

	June 30, 2016				December 31, 2015
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Thermo Loan Agreement	$	57,264	$	29,207	$	50,664	$	17,244
2013 8.00% Notes	13,471		12,111		12,440		9,831

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Accrued Expenses and Other Non-Current Liabilities (Tables)

6 Months Ended

Jun. 30, 2016

Payables and Accruals [Abstract]

Schedule of accrued expenses

Accrued expenses consist of the following (in thousands): 

	June 30, 2016		December 31, 2015
Accrued interest	$	319	$	317
Accrued compensation and benefits	2,927		2,098
Accrued property and other taxes	4,391		4,125
Accrued customer liabilities and deposits	3,336		3,216
Accrued professional and other service provider fees	2,401		1,830
Accrued commissions	969		1,216
Accrued telecommunications expenses	865		1,487
Accrued inventory	217		502
Accrued liability for potential stock issuance to Hughes	7,418		5,495
Accrued liability for legal settlement	1,422		328
Other accrued expenses	2,690		1,825
Total accrued expenses	$	26,955	$	22,439

Schedule of Other Non-current Liabilities

Other non-current liabilities consist of the following (in thousands):   

	June 30, 2016		December 31, 2015
Long-term accrued interest	$	96	$	96
Asset retirement obligation	1,373		1,302
Deferred rent and other deferred expense	561		593
Liability related to the Cooperative Endeavor Agreement with the State of Louisiana	616		716
Uncertain income tax positions	6,352		5,795
Foreign tax contingencies	2,706		2,311
Capital lease obligations	227		94
Total other non-current liabilities	$	11,931	$	10,907

XML

Accumulated Other Comprehensive Income (Loss) (Tables)

6 Months Ended

Jun. 30, 2016

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Components of accumulated other comprehensive loss

The components of accumulated other comprehensive income (loss) were as follows (in thousands): 

	Three Months Ended June 30,						Six Months Ended June 30,
	2016			2015			2016			2015
Accumulated other comprehensive loss, beginning of period	$	(5,484	)	$	(4,188	)	$	(4,833	)	$	(2,898	)
Other comprehensive income (loss):
Foreign currency translation adjustments	(925		)	447			(1,576		)	(843		)
Accumulated other comprehensive loss, end of period	$	(6,409	)	$	(3,741	)	$	(6,409	)	$	(3,741	)

XML

Geographic Information (Tables)

6 Months Ended

Jun. 30, 2016

Segment Reporting [Abstract]

Company's information on revenues and long-lived assets by geographic area

The Company’s information by geographic area is as follows (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2016		2015		2016		2015
Revenues:
Service revenue:
United States	$	14,407	$	12,468	$	27,676	$	24,183
Canada	4,066		3,771		7,310		7,204
Europe	1,805		1,541		3,263		2,743
Central and South America	570		688		1,188		1,302
Others	122		148		282		291
Total service revenue	$	20,970	$	18,616	$	39,719	$	35,723
Subscriber equipment sales:
United States	2,226		1,990		3,530		3,578
Canada	1,052		1,278		1,813		2,439
Europe	527		452		956		985
Central and South America	279		424		667		1,057
Others	32		263		237		263
Total subscriber equipment sales	$	4,116	$	4,407	$	7,203	$	8,322
Total revenue	$	25,086	$	23,023	$	46,922	$	44,045

	June 30, 2016		December 31, 2015
Property and equipment, net:
United States	$	1,054,493	$	1,073,327
Canada	626		510
Europe	454		484
Central and South America	3,126		2,782
Others	320		457
Total property and equipment, net	$	1,059,019	$	1,077,560

XML

Earnings (Loss) Per Share (Tables)

6 Months Ended

Jun. 30, 2016

Earnings Per Share [Abstract]

Reconciliation of basic weighted average share to diluted weighted average common shares outstanding

The following table sets forth the calculation of basic and diluted earnings (loss) per share for the periods indicated (in thousands):

	Three Months Ended   June 30,				Six Months Ended   June 30,
	2016		2015		2016			2015
Net income (loss)	$	14,099	$	204,767	$	(12,848	)	$	75,040
Effect of dilutive securities:
2013 8.00% Notes	537		593		—			1,313
Thermo Loan Agreement	2,401		2,148		—			4,251
Income (loss) to common stockholders plus assumed conversions	$	17,037	$	207,508	$	(12,848	)	$	80,604
Weighted average common shares outstanding:
Basic shares outstanding	1,049,381		1,009,917		1,045,205			1,005,406
Incremental shares from assumed exercises, conversions and other issuances:
Stock options, restricted stock, restricted stock units and ESPP	5,793		8,667		—			8,534
2013 8.00% Notes	27,164		28,001		—			27,778
Thermo Loan Agreement	139,709		120,673		—			119,272
Warrants and other	27,625		38,192		—			38,192
Diluted shares outstanding	1,249,672		1,205,450		1,045,205			1,199,182
Income (loss) per share:
Basic	0.01		0.20		(0.01		)	0.07
Diluted	0.01		0.17		(0.01		)	0.07

XML

Condensed Consolidating Financial Information (Tables)

6 Months Ended

Jun. 30, 2016

SUPPLEMENTAL CONSOLIDATING FINANCIAL INFORMATION [Abstract]

Supplemental condensed consolidating statement of operations

Globalstar, Inc.

Condensed Consolidating Statement of Operations

Six Months Ended June 30, 2016

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
Revenue:
Service revenues	$	27,882		$	18,358		$	20,114		$	(26,635	)	$	39,719
Subscriber equipment sales	424			4,466			3,674			(1,361		)	7,203
Total revenue	28,306			22,824			23,788			(27,996		)	46,922
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	9,948			2,070			5,597			(2,087		)	15,528
Cost of subscriber equipment sales	187			3,540			2,693			(1,356		)	5,064
Marketing, general and administrative	10,604			1,854			33,064			(25,462		)	20,060
Depreciation, amortization, and accretion	37,623			426			569			(239		)	38,379
Total operating expenses	58,362			7,890			41,923			(29,144		)	79,031
Income (loss) from operations	(30,056		)	14,934			(18,135		)	1,148			(32,109		)
Other income (expense):
Loss on equity issuance	(1,923		)	—			—			—			(1,923		)
Interest income and expense, net of amounts capitalized	(17,981		)	(12		)	(152		)	(9		)	(18,154		)
Derivative gain	39,155			—			—			—			39,155
Equity in subsidiary earnings (loss)	(1,427		)	2,079			—			(652		)	—
Other	(616		)	(112		)	604			48			(76		)
Total other income (expense)	17,208			1,955			452			(613		)	19,002
Income (loss) before income taxes	(12,848		)	16,889			(17,683		)	535			(13,107		)
Income tax benefit	—			—			(259		)	—			(259		)
Net income (loss)	$	(12,848	)	$	16,889		$	(17,424	)	$	535		$	(12,848	)
Comprehensive income (loss)	$	(12,848	)	$	16,889		$	(19,000	)	$	535		$	(14,424	)

Globalstar, Inc.

Condensed Consolidating Statement of Operations

Six Months Ended June 30, 2015

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
Revenue:
Service revenues	$	32,175		$	14,543		$	20,020		$	(31,015	)	$	35,723
Subscriber equipment sales	354			6,064			5,491			(3,587		)	8,322
Total revenue	32,529			20,607			25,511			(34,602		)	44,045
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	9,504			3,177			6,289			(3,509		)	15,461
Cost of subscriber equipment sales	60			5,443			5,732			(5,121		)	6,114
Marketing, general and administrative	9,449			2,991			32,305			(25,990		)	18,755
Depreciation, amortization, and accretion	37,327			591			652			(253		)	38,317
Total operating expenses	56,340			12,202			44,978			(34,873		)	78,647
Income (loss) from operations	(23,811		)	8,405			(19,467		)	271			(34,602		)
Other income (expense):
Loss on extinguishment of debt	(2,254		)	—			—			—			(2,254		)
Loss on equity issuance	(2,912		)	—			—			—			(2,912		)
Interest income and expense, net of amounts capitalized	(17,443		)	(15		)	(309		)	6			(17,761		)
Derivative gain	129,222			—			—			—			129,222
Equity in subsidiary earnings (loss)	(8,949		)	5,426			—			3,523			—
Other	1,132			394			2,102			53			3,681
Total other income (expense)	98,796			5,805			1,793			3,582			109,976
Income (loss) before income taxes	74,985			14,210			(17,674		)	3,853			75,374
Income tax expense (benefit)	(55		)	15			374			—			334
Net income (loss)	$	75,040		$	14,195		$	(18,048	)	$	3,853		$	75,040
Comprehensive income (loss)	$	75,040		$	14,195		$	(18,891	)	$	3,853		$	74,197

Globalstar, Inc.

Condensed Consolidating Statement of Operations

Three Months Ended June 30, 2016

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
Revenue:
Service revenues	$	10,944		$	10,863		$	10,689		$	(11,526	)	$	20,970
Subscriber equipment sales	96			2,774			1,997			(751		)	4,116
Total revenue	11,040			13,637			12,686			(12,277		)	25,086
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	5,135			1,034			2,702			(934		)	7,937
Cost of subscriber equipment sales	43			2,112			1,478			(747		)	2,886
Marketing, general and administrative	5,430			1,322			16,219			(11,521		)	11,450
Depreciation, amortization, and accretion	18,851			206			288			(121		)	19,224
Total operating expenses	29,459			4,674			20,687			(13,323		)	41,497
Income (loss) from operations	(18,419		)	8,963			(8,001		)	1,046			(16,411		)
Other income (expense):
Loss on equity issuance	(2,075		)	—			—			—			(2,075		)
Interest income and expense, net of amounts capitalized	(9,000		)	(3		)	(47		)	1			(9,049		)
Derivative gain	40,499			—			—			—			40,499
Equity in subsidiary earnings (loss)	2,924			(968		)	—			(1,956		)	—
Other	170			92			328			95			685
Total other income (expense)	32,518			(879		)	281			(1,860		)	30,060
Income (loss) before income taxes	14,099			8,084			(7,720		)	(814		)	13,649
Income tax benefit	—			—			(450		)	—			(450		)
Net income (loss)	$	14,099		$	8,084		$	(7,270	)	$	(814	)	$	14,099
Comprehensive income (loss)	$	14,099		$	8,084		$	(8,195	)	$	(814	)	$	13,174

Globalstar, Inc.

Condensed Consolidating Statement of Operations

Three Months Ended June 30, 2015

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
Revenue:
Service revenues	$	15,932		$	6,865		$	11,213		$	(15,394	)	$	18,616
Subscriber equipment sales	296			2,615			2,993			(1,497		)	4,407
Total revenue	16,228			9,480			14,206			(16,891		)	23,023
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	4,969			1,652			3,037			(1,631		)	8,027
Cost of subscriber equipment sales	78			2,137			3,286			(2,518		)	2,983
Marketing, general and administrative	4,940			1,832			16,561			(13,174		)	10,159
Depreciation, amortization, and accretion	18,778			293			329			(129		)	19,271
Total operating expenses	28,765			5,914			23,213			(17,452		)	40,440
Income (loss) from operations	(12,537		)	3,566			(9,007		)	561			(17,417		)
Other income (expense):
Loss on extinguishment of debt	(2,189		)	—			—			—			(2,189		)
Loss on equity issuance	(2,912		)	—			—			—			(2,912		)
Interest income and expense, net of amounts capitalized	(9,107		)	(5		)	(138		)	6			(9,244		)
Derivative gain	237,087			—			—			—			237,087
Equity in subsidiary earnings (loss)	(5,035		)	1,161			—			3,874			—
Other	(674		)	(132		)	355			(1		)	(452		)
Total other income (expense)	217,170			1,024			217			3,879			222,290
Income (loss) before income taxes	204,633			4,590			(8,790		)	4,440			204,873
Income tax expense (benefit)	(134		)	(8		)	248						106
Net income (loss)	$	204,767		$	4,598		$	(9,038	)	$	4,440		$	204,767
Comprehensive income (loss)	$	204,767		$	4,598		$	(8,591	)	$	4,440		$	205,214

Supplemental condensed consolidating balance sheet

Globalstar, Inc.

Condensed Consolidating Balance Sheet

As of June 30, 2016

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	7,640		$	807		$	2,822		$	—		$	11,269
Accounts receivable	5,925			6,022			4,217			—			16,164
Intercompany receivables	869,736			644,878			63,659			(1,578,273		)	—
Inventory	2,128			5,058			2,512			—			9,698
Prepaid expenses and other current assets	2,393			330			2,307			—			5,030
Total current assets	887,822			657,095			75,517			(1,578,273		)	42,161
Property and equipment, net	1,051,013			3,479			4,649			(122		)	1,059,019
Restricted cash	37,918			—			—			—			37,918
Intercompany notes receivable	10,717			—			16,295			(27,012		)	—
Investment in subsidiaries	(272,351		)	23,009			34,404			214,938			—
Prepaid second-generation ground costs	4,165			—			—			—			4,165
Intangible and other assets, net	12,739			200			568			(10		)	13,497
Total assets	$	1,732,023		$	683,783		$	131,433		$	(1,390,479	)	$	1,156,760
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	38,112		$	—		$	—		$	—		$	38,112
Accounts payable	2,360			2,571			1,108			—			6,039
Accrued contract termination charge	19,468			—			—			—			19,468
Accrued expenses	13,378			6,047			7,530			—			26,955
Intercompany payables	620,440			725,974			241,038			(1,587,452		)	—
Payables to affiliates	240			—			—			—			240
Deferred revenue	2,007			17,691			5,527			—			25,225
Total current liabilities	696,005			752,283			255,203			(1,587,452		)	116,039
Long-term debt, less current portion	540,350			—			—			—			540,350
Employee benefit obligations	4,894			—			—			—			4,894
Intercompany notes payable	6,004			—			12,860			(18,864		)	—
Derivative liabilities	200,482			—			—			—			200,482
Deferred revenue	5,834			291			—			—			6,125
Debt restructuring fees	20,795			—			—			—			20,795
Other non-current liabilities	1,515			315			10,101			—			11,931
Total non-current liabilities	779,874			606			22,961			(18,864		)	784,577
Stockholders’ equity (deficit)	256,144			(69,106		)	(146,731		)	215,837			256,144
Total liabilities and stockholders’ equity	$	1,732,023		$	683,783		$	131,433		$	(1,390,479	)	$	1,156,760

Globalstar, Inc.

Condensed Consolidating Balance Sheet

As of December 31, 2015

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	3,530		$	719		$	3,227		$	—		$	7,476
Accounts receivable	4,521			5,215			4,461			339			14,536
Intercompany receivables	859,370			465,488			34,742			(1,359,600		)	—
Inventory	2,148			6,321			3,554			—			12,023
Prepaid expenses and other current assets	2,399			291			1,766			—			4,456
Total current assets	871,968			478,034			47,750			(1,359,261		)	38,491
Property and equipment, net	1,069,605			3,722			4,587			(354		)	1,077,560
Restricted cash	37,918			—			—			—			37,918
Intercompany notes receivable	12,037			—			14,994			(27,031		)	—
Investment in subsidiaries	(298,976		)	9,512			32,946			256,518			—
Prepaid second-generation ground costs	8,929			—			—			—			8,929
Intangible and other assets, net	11,384			280			464			(11		)	12,117
Total assets	$	1,712,865		$	491,548		$	100,741		$	(1,130,139	)	$	1,175,015
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	32,835		$	—		$	—		$	—		$	32,835
Accounts payable	4,292			2,439			1,387			—			8,118
Accrued contract termination charge	19,121			—			—			—			19,121
Accrued expenses	9,816			6,949			5,674			—			22,439
Intercompany payables	580,383			604,999			179,105			(1,364,487		)	—
Payables to affiliates	616			—			—			—			616
Deferred revenue	1,980			17,722			4,200			—			23,902
Total current liabilities	649,043			632,109			190,366			(1,364,487		)	107,031
Long-term debt, less current portion	548,286			—			—			—			548,286
Employee benefit obligations	4,810			—			—			—			4,810
Intercompany notes payable	5,564			—			13,970			(19,534		)	—
Derivative liabilities	239,642			—			—			—			239,642
Deferred revenue	6,027			386			—			—			6,413
Debt restructuring fees	20,795			—			—			—			20,795
Other non-current liabilities	1,567			305			9,035			—			10,907
Total non-current liabilities	826,691			691			23,005			(19,534		)	830,853
Stockholders’ equity (deficit)	237,131			(141,252		)	(112,630		)	253,882			237,131
Total liabilities and stockholders’ equity	$	1,712,865		$	491,548		$	100,741		$	(1,130,139	)	$	1,175,015

Supplemental condensed consolidating statement of cash flows

Globalstar, Inc.

Condensed Consolidating Statement of Cash Flows

Six Months Ended June 30, 2016

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations		Consolidated
	(In thousands)
Cash flows provided by (used in) operating activities	$	916		$	255		$	(170	)	$	—	$	1,001
Cash flows used in investing activities:
Second-generation network costs (including interest)	(5,161		)	—			(146		)	—		(5,307		)
Property and equipment additions	(5,937		)	(167		)	(241		)	—		(6,345		)
Purchase of intangible assets	(806		)	—			—			—		(806		)
Net cash used in investing activities	(11,904		)	(167		)	(387		)	—		(12,458		)
Cash flows provided by (used in) financing activities:
Principal payments of the Facility Agreement	(16,418		)	—			—			—		(16,418		)
Proceeds from issuance of stock to Terrapin	28,500			—			—			—		28,500
Proceeds from issuance of common stock and exercise of options and warrants	3,016			—			—			—		3,016
Net cash provided by financing activities	15,098			—			—			—		15,098
Effect of exchange rate changes on cash	—			—			152			—		152
Net increase (decrease) in cash and cash equivalents	4,110			88			(405		)	—		3,793
Cash and cash equivalents, beginning of period	3,530			719			3,227			—		7,476
Cash and cash equivalents, end of period	$	7,640		$	807		$	2,822		$	—	$	11,269

Globalstar, Inc.

Condensed Consolidating Statement of Cash Flows

Six Months Ended June 30, 2015

(Unaudited)

	Parent Company			Guarantor Subsidiaries			Non- Guarantor Subsidiaries			Eliminations		Consolidated
	(In thousands)
Cash flows provided by (used in) operating activities	$	(3,451	)	$	1,239		$	950		$	—	$	(1,262	)
Cash flows used in investing activities:
Second-generation network costs (including interest)	(10,344		)	—			—			—		(10,344		)
Property and equipment additions	(636		)	(1,452		)	(237		)	—		(2,325		)
Purchase of intangible assets	(1,343		)									(1,343		)
Net cash used in investing activities	(12,323		)	(1,452		)	(237		)	—		(14,012		)
Cash flows provided by (used in) financing activities:
Principal payments of the Facility Agreement	(3,225		)									(3,225		)
Proceeds from issuance of stock to Terrapin	24,000			—			—			—		24,000
Proceeds from issuance of common stock and exercise of options and warrants	419			—			—			—		419
Net cash provided by financing activities	21,194			—			—			—		21,194
Effect of exchange rate changes on cash	—			—			(170		)	—		(170		)
Net increase (decrease) in cash and cash equivalents	5,420			(213		)	543			—		5,750
Cash and cash equivalents, beginning of period	3,166			672			3,283			—		7,121
Cash and cash equivalents, end of period	$	8,586		$	459		$	3,826		$	—	$	12,871

XML

Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 1,541,973	$ 1,521,729
Accumulated depreciation	(482,954)	(444,169)
Total property and equipment, net	1,059,019	1,077,560
Internally developed and purchased software
Property, Plant and Equipment [Line Items]
Property and equipment, gross	14,753	14,492
Equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	11,996	10,802
Land and buildings
Property, Plant and Equipment [Line Items]
Property and equipment, gross	3,343	3,151
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	1,731	1,671
Globalstar System
Property, Plant and Equipment [Line Items]
Property and equipment, gross	1,510,150	1,491,613
Globalstar System | Ground component
Property, Plant and Equipment [Line Items]
Property and equipment, gross	48,184	46,870
Globalstar System | First and second-generation satellites in service | Space component
Property, Plant and Equipment [Line Items]
Property and equipment, gross	1,211,226	1,211,768
Globalstar System | Prepaid long-lead items | Space component
Property, Plant and Equipment [Line Items]
Property and equipment, gross	17,040	17,040
Globalstar System | Second-generation satellite, on-ground spare | Space component
Property, Plant and Equipment [Line Items]
Property and equipment, gross	32,481	32,481
Globalstar System | Construction in progress | Space component
Property, Plant and Equipment [Line Items]
Property and equipment, gross	81	81
Globalstar System | Construction in progress | Ground component
Property, Plant and Equipment [Line Items]
Property and equipment, gross	190,328	177,780
Globalstar System | Construction in progress | Next-generation software upgrades
Property, Plant and Equipment [Line Items]
Property and equipment, gross	8,435	3,440
Globalstar System | Construction in progress | Other
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 2,375	$ 2,153

XML

Property and Equipment - Narrative (Details) (Details) € in Millions	1 Months Ended
	Jun. 30, 2009 EUR (€)
Property, Plant and Equipment [Abstract]
Payments to Acquire Machinery and Equipment (in euros)	€ 12.0
Payments for construction in process (in euros)	€ 3.1

XML

Property and Equipment - Capitalized Interest and Depreciation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Interest Costs Incurred [Abstract]
Interest costs eligible to be capitalized	$ 11,947	$ 10,589	$ 23,792	$ 20,705
Interest costs recorded in interest income (expense), net	(8,565)	(8,125)	(17,144)	(16,049)
Net interest capitalized	3,382	2,464	6,648	4,656
Depreciation expense	$ 19,118	$ 19,127	$ 38,168	$ 38,030

XML

Long-Term Debt and Other Financing Arrangements - ASU No. 2015-03 Update (Details) $ in Millions	Dec. 31, 2015 USD ($)
Accounting Standards Update 2015-03 | Long-term Debt
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Debt issuance costs, net	$ 57.9

XML

Long-Term Debt and Other Financing Arrangements - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Principal Amount
Total Debt	$ 664,765	$ 675,815
Less: Current Portion	38,112	32,835
Long-Term Debt	626,653	642,980
Unamortized Discount and Deferred Financing Costs	86,303	94,694
Carrying Value
Total Debt	578,462	581,121
Less: Current Portion	38,112	32,835
Long-term debt, less current portion	540,350	548,286
Facility Agreement
Principal Amount
Total Debt	559,429	575,846
Unamortized Discount and Deferred Financing Costs	51,702	57,829
Carrying Value
Total Debt	507,727	518,017
Thermo Loan Agreement
Principal Amount
Total Debt	88,400	83,222
Unamortized Discount and Deferred Financing Costs	31,136	32,558
Carrying Value
Total Debt	57,264	50,664
8.00% Convertible Senior Notes Issued in 2013
Principal Amount
Total Debt	16,936	16,747
Unamortized Discount and Deferred Financing Costs	3,465	4,307
Carrying Value
Total Debt	$ 13,471	$ 12,440

XML

Long-Term Debt and Other Financing Arrangements - Facility Agreement (Details) - USD ($)	1 Months Ended			6 Months Ended
	Jun. 30, 2016	Feb. 29, 2016	Aug. 31, 2015	Jun. 30, 2016	Jun. 30, 2015
Terrapin
Debt Instrument [Line Items]
Proceeds from lines of credit	$ 22,000,000	$ 6,500,000	$ 15,000,000		$ 24,000,000
Facility Agreement
Debt Instrument [Line Items]
Interest above LIBOR rate				2.75%
Percentage of guarantee provided by French export credit agency to lending syndicate				95.00%
Debt instrument, covenant, equity cure contribution, minimum amount				$ 10,000,000
Debt service reserve account	$ 37,900,000			$ 37,900,000
Facility Agreement | Domestic Subsidiaries
Debt Instrument [Line Items]
Percentage of equity pledged as collateral	100.00%			100.00%
Facility Agreement | Foreign Subsidiaries
Debt Instrument [Line Items]
Percentage of equity pledged as collateral	65.00%			65.00%
Facility Agreement | Minimum
Debt Instrument [Line Items]
Interest rate increase				0.50%
Facility Agreement | Maximum
Debt Instrument [Line Items]
Interest rate increase				5.75%

XML

Long-Term Debt and Other Financing Arrangements - Thermo Loan Agreement (Details) - USD ($)	1 Months Ended			6 Months Ended
	Jun. 30, 2016	Feb. 29, 2016	Aug. 31, 2015	Jun. 30, 2016	Jun. 30, 2015	Dec. 28, 2012
Debt Instrument [Line Items]
Maximum value of shares required to be purchased per terms of stock purchase agreement			$ 75,000,000.0			$ 30,000,000.0
Thermo
Debt Instrument [Line Items]
Maximum value of shares required to be purchased per terms of stock purchase agreement	$ 0		30,000,000.0	$ 0
Terrapin
Debt Instrument [Line Items]
Maximum value of shares required to be purchased per terms of stock purchase agreement	31,500,000.0			$ 31,500,000.0
Proceeds from lines of credit	$ 22,000,000	$ 6,500,000	$ 15,000,000		$ 24,000,000
Thermo Loan Agreement | Thermo
Debt Instrument [Line Items]
Loan interest rate	12.00%			12.00%
Maturity period after full payment of Facility Agreement				6 months
Outstanding interest	$ 44,900,000			$ 44,900,000

XML

Long-Term Debt and Other Financing Arrangements - 8.00% Convertible Senior Notes Issued in 2013 (Details)	3 Months Ended		6 Months Ended		12 Months Ended	30 Months Ended
	Jun. 30, 2016 USD ($) $ / shares	Jun. 30, 2015 USD ($) shares	Jun. 30, 2016 USD ($) $ / shares shares	Jun. 30, 2015 USD ($) shares	Dec. 31, 2013 USD ($) shares $ / shares	Jun. 30, 2016 USD ($) $ / shares
Debt Instrument [Line Items]
Principal Amount Converted			$ 0	$ 6,491,000
Loss on extinguishment of debt	$ 0	$ 2,189,000	$ 0	2,254,000
Debt conversion, converted instrument, settlement period			40 days
8.00% Convertible Senior Notes Issued in 2013
Debt Instrument [Line Items]
Loan interest rate					8.00%
Conversion price per share of common stock (USD per share) | $ / shares	$ 0.73		$ 0.73		$ 0.80	$ 0.73
Number of shares of common stock convertible into (in shares) | shares					1,250
Principal Amount Converted					$ 1,000
Interest rate, payable in cash					5.75%
Interest rate, payable in additional notes					2.25%
Debt conversion, converted instrument, amount	$ 0	$ 6,300,000	$ 0	$ 6,500,000		$ 39,400,000
Debt conversion, converted instrument, shares issued (in shares) | shares		10,400,000	72,100,000	10,900,000
Loss on extinguishment of debt		$ 2,200,000		$ 2,300,000

XML

Long-Term Debt and Other Financing Arrangements - Warrants Outstanding (Details) - USD ($) $ / shares in Units, $ in Millions	1 Months Ended	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2016	Dec. 31, 2015	Jun. 30, 2011
Class of Warrant or Right [Line Items]
Warrants outstanding (in shares)	24,571,428	24,571,428	38,191,866
Contingent Equity Agreement
Class of Warrant or Right [Line Items]
Warrants outstanding (in shares)	24,571,428	24,571,428	30,191,866
Exercise price of warrants (USD per share)	$ 0.01	$ 0.01	$ 0.01
Expiration period		5 years
Number of warrants exercised (in shares)	5,600,000	5,600,000
Proceeds from warrant exercises	$ 0.1
Contingent Equity Agreement | Thermo
Class of Warrant or Right [Line Items]
Warrants outstanding (in shares)	24,600,000	24,600,000
Number of shares issued (in shares)		16,900,000
Proceeds from warrant exercises	$ 2.6
5.00% Convertible Senior Unsecured Notes
Class of Warrant or Right [Line Items]
Warrants outstanding (in shares)	0	0	8,000,000
Exercise price of warrants (USD per share)	$ 0	$ 0	$ 0.32
Number of warrants exercised (in shares)	8,000,000	8,000,000		15,200,000
Proceeds from warrant exercises	$ 2.5
Loan interest rate				5.00%

XML

Long-Term Debt and Other Financing Arrangements - Terrapin Opportunity, L.P. Common Stock Purchase Agreement (Details)		1 Months Ended			6 Months Ended		12 Months Ended
	Dec. 28, 2012 USD ($)	Jun. 30, 2016 USD ($) $ / shares shares	Feb. 29, 2016 USD ($) $ / shares shares	Aug. 31, 2015 USD ($) draw_down_notice $ / shares shares	Jun. 30, 2016 USD ($) $ / shares	Jun. 30, 2015 USD ($) $ / shares shares	Dec. 31, 2015 USD ($) shares
Debt Instrument [Line Items]
Maximum value of shares required to be purchased per terms of stock purchase agreement	$ 30,000,000.0			$ 75,000,000.0
Stock purchase agreement term	24 months			24 months
Proceeds from issuance of stock to Terrapin					$ 28,500,000	$ 24,000,000
Number of draw down notices (in notices) | draw_down_notice				24
Draw down period	10 days
Minimum discount percentage per each share sold under the stock sold agreement				2.75%
Maximum discount percentage per each share sold under the stock purchase agreement				4.00%
Maximum beneficial ownership percentage allowed per terms of stock purchase agreement				9.90%
Terrapin
Debt Instrument [Line Items]
Maximum value of shares required to be purchased per terms of stock purchase agreement		$ 31,500,000.0			$ 31,500,000.0
Proceeds from lines of credit		$ 22,000,000	$ 6,500,000	$ 15,000,000		$ 24,000,000
Number of shares issued (in shares) | shares		19,500,000.0	6,400,000.0	9,300,000.0		11,100,000.0	17,200,000.0
Shares issued, price per share (USD per share) | $ / shares		$ 1.13	$ 1.02	$ 1.61	$ 1.13	$ 2.18
Proceeds from issuance of stock to Terrapin							$ 30,000,000

XML

Derivatives - Schedule of Fair Value of Derivative Instruments (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Derivative liabilities:
Derivative liabilities, non-current	$ (200,482)	$ (239,642)
Total derivative liabilities	(200,482)	(239,642)
Interest rate cap
Derivative assets:
Intangible and other assets	1	6
Compound embedded derivative with 2013 8.00% Notes
Derivative liabilities:
Derivative liabilities, non-current	(20,420)	(26,203)
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement
Derivative liabilities:
Derivative liabilities, non-current	$ (180,062)	$ (213,439)

XML

Derivatives - Schedule of Derivative Gain (Loss) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gain (loss)	$ 40,499	$ 237,087	$ 39,155	$ 129,222
Interest rate cap
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gain (loss)	(1)	(6)	(5)	(27)
Compound embedded derivative with 2013 8.00% Notes
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gain (loss)	5,335	37,928	5,783	18,892
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement
Derivative Instruments, Gain (Loss) [Line Items]
Derivative gain (loss)	$ 35,165	$ 199,165	$ 33,377	$ 110,357

XML

Derivatives - Narrative (Details) $ in Millions	1 Months Ended
	Jun. 30, 2009 USD ($) contract	Dec. 31, 2013
8.00% Convertible Senior Notes Issued in 2013
Derivative [Line Items]
Loan interest rate		8.00%
Interest rate cap
Derivative [Line Items]
Number of Interest rate cap agreements (in contracts) | contract	5
Maturity period	10 years
Interest rate cap | Six-month LIBOR Rate
Derivative [Line Items]
Base rate to be capped, should the Base Rate not exceed 6.50%	5.50%
Interest on outstanding amounts on the Facility Agreement	6.50%
Base rate to be lowered from LIBOR, should the base rate exceed 6.50%	1.00%
Fee for interest rate cap agreements | $	$ 12.4

XML

Fair Value Measurements - Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Fair value, measurements, recurring - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets measured at fair value	$ 1	$ 6
Total liabilities measured at fair value	(207,900)	(245,137)
Liability for potential stock issuance to Hughes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities measured at fair value	(7,418)	(5,495)
Interest rate cap
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets measured at fair value	1	6
Compound embedded derivative with 2013 8.00% Notes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities measured at fair value	(20,420)	(26,203)
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities measured at fair value	(180,062)	(213,439)
(Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets measured at fair value	0	0
Total liabilities measured at fair value	0	0
(Level 1) | Liability for potential stock issuance to Hughes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities measured at fair value	0	0
(Level 1) | Interest rate cap
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets measured at fair value	0	0
(Level 1) | Compound embedded derivative with 2013 8.00% Notes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities measured at fair value	0	0
(Level 1) | Compound embedded derivative with the Amended and Restated Thermo Loan Agreement
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities measured at fair value	0	0
(Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets measured at fair value	1	6
Total liabilities measured at fair value	(7,418)	(5,495)
(Level 2) | Liability for potential stock issuance to Hughes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities measured at fair value	(7,418)	(5,495)
(Level 2) | Interest rate cap
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets measured at fair value	1	6
(Level 2) | Compound embedded derivative with 2013 8.00% Notes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities measured at fair value	0	0
(Level 2) | Compound embedded derivative with the Amended and Restated Thermo Loan Agreement
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities measured at fair value	0	0
(Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities measured at fair value	(200,482)	(239,642)
(Level 3) | Liability for potential stock issuance to Hughes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities measured at fair value	0	0
(Level 3) | Interest rate cap
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets measured at fair value	0	0
(Level 3) | Compound embedded derivative with 2013 8.00% Notes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities measured at fair value	(20,420)	(26,203)
(Level 3) | Compound embedded derivative with the Amended and Restated Thermo Loan Agreement
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total liabilities measured at fair value	$ (180,062)	$ (213,439)

XML

Fair Value Measurements - Narratives (Details) $ in Thousands	1 Months Ended		6 Months Ended
	Jun. 30, 2015 USD ($)	Apr. 30, 2015 USD ($)	Jun. 30, 2016 USD ($) contract	Jun. 30, 2015 USD ($)	Dec. 31, 2013
Fair Value Measurements [Line Items]
Fair value of common stock issued to vendor for payment of invoices			$ 0	$ 16,684
Stock issuance settlement period			40 days
8.00% Convertible Senior Notes Issued in 2013
Fair Value Measurements [Line Items]
Loan interest rate					8.00%
(Level 3)
Fair Value Measurements [Line Items]
Number of derivatives (contract) | contract			2
Hughes Network Systems LLC
Fair Value Measurements [Line Items]
Fair value of common stock issued to vendor for payment of invoices	$ 15,500	$ 15,500

XML

Fair Value Measurements - Schedule of Significant Quantitative Level 3 Inputs Utilized (Details) - $ / shares	6 Months Ended	12 Months Ended
	Jun. 30, 2016	Dec. 31, 2015
Compound embedded derivative with 2013 8.00% Notes
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Risk-Free Interest Rate	0.50%	1.10%
Note Conversion Price/Warrant Exercise Price (USD per share)	$ 0.73	$ 0.73
Market Price of Common Stock (USD per share)	$ 1.21	$ 1.44
Compound embedded derivative with 2013 8.00% Notes | Minimum
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Stock Price Volatility	100.00%	75.00%
Compound embedded derivative with 2013 8.00% Notes | Maximum
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Stock Price Volatility	130.00%	90.00%
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Risk-Free Interest Rate	1.30%	2.10%
Note Conversion Price/Warrant Exercise Price (USD per share)	$ 0.73	$ 0.73
Market Price of Common Stock (USD per share)	$ 1.21	$ 1.44
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement | Minimum
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Stock Price Volatility	40.00%	50.00%
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement | Maximum
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items]
Stock Price Volatility	130.00%	90.00%

XML

Fair Value Measurements - Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance at beginning of period	$ (240,982)	$ (548,526)	$ (239,642)	$ (441,550)
Unrealized gain, included in derivative gain	40,500	237,093	39,160	129,249
Balance at end of period	(200,482)	(292,293)	(200,482)	(292,293)
Derivative Financial Instruments, Liabilities
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Derivative adjustment related to conversions	$ 0	$ 19,140	$ 0	$ 20,008

XML

Fair Value Measurements - Fair Value and Carrying Value of Debt (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, carrying value	$ 578,462	$ 581,121
Thermo Loan Agreement
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, carrying value	57,264	50,664
Thermo Loan Agreement | Estimated Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt instrument, fair value disclosure	29,207	17,244
8.00% Convertible Senior Notes Issued in 2013
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, carrying value	13,471	12,440
8.00% Convertible Senior Notes Issued in 2013 | Estimated Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt instrument, fair value disclosure	$ 12,111	$ 9,831

XML

Accrued Expenses and Other Non-Current Liabilities (Details) $ in Thousands, BRL in Millions	Jun. 30, 2016 USD ($)	Jun. 30, 2016 BRL	Dec. 31, 2015 USD ($)
Accrued expenses:
Accrued interest	$ 319		$ 317
Accrued compensation and benefits	2,927		2,098
Accrued property and other taxes	4,391		4,125
Accrued customer liabilities and deposits	3,336		3,216
Accrued professional and other service provider fees	2,401		1,830
Accrued commissions	969		1,216
Accrued telecommunications expenses	865		1,487
Accrued inventory	217		502
Accrued liability for potential stock issuance to Hughes	7,418		5,495
Accrued liability for legal settlement	1,422	BRL 4.5	328
Other accrued expenses	2,690		1,825
Total accrued expenses	26,955		22,439
Non-current liabilities:
Long-term accrued interest	96		96
Asset retirement obligation	1,373		1,302
Deferred rent and other deferred expense	561		593
Liability related to the Cooperative Endeavor Agreement with the State of Louisiana	616		716
Uncertain income tax positions	6,352		5,795
Foreign tax contingencies	2,706		2,311
Capital lease obligations	227		94
Total other non-current liabilities	$ 11,931		$ 10,907

XML

Accrued Expenses and Other Non-Current Liabilities - Narrative (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Jun. 30, 2016	Dec. 31, 2015
Income Tax Contingency [Line Items]
Unrecognized tax benefits		$ (6,352)	$ (5,795)
Scenario, Forecast
Income Tax Contingency [Line Items]
Unrecognized tax benefits	$ 6,400

XML

Commitments (Details) $ in Thousands		1 Months Ended			6 Months Ended
	Oct. 24, 2014 EUR (€)	Jun. 30, 2015 USD ($) shares	Apr. 30, 2015 USD ($)	Jul. 31, 2014	Jun. 30, 2016 USD ($)	Jun. 30, 2015 USD ($)	Dec. 31, 2015 USD ($)	Mar. 31, 2015 USD ($)
Commitments [Line Items]
Fair value of common stock issued to vendor for payment of invoices					$ 0	$ 16,684
Accrued liability for potential stock issuance to Hughes					7,418		$ 5,495
Hughes Network Systems LLC
Commitments [Line Items]
Contractual obligation								$ 1,900
Increase in contract amount			$ 4,000
Percentage discount when paid In stock		7.00%	7.00%
Contract amount			$ 15,500
Share-based goods and nonemployee services transaction, quantity of securities issued (in shares) | shares		7,400,000.0
Fair value of common stock issued to vendor for payment of invoices		$ 15,500	15,500
Accrued liability for potential stock issuance to Hughes					7,400		$ 5,500
Ericsson Inc.
Commitments [Line Items]
Contract amount			1,000		$ 6,000
Interest accrued rate				6.50%
Accounts payable, interest-bearing, current			$ 400
Support Services | Thales Alenia Space
Commitments [Line Items]
Long-term purchase commitment, period	3 years
Long-term purchase commitment, amount (in euros) | €	€ 1,900,000
Long-term purchase commitment, contract credit amount (in euros) | €	600,000
Long-term purchase commitment, first annual payment contract amount (in euros) | €	€ 0

XML

Contingencies (Details) $ in Thousands, € in Millions, BRL in Millions				6 Months Ended	12 Months Ended
	Jun. 24, 2012 EUR (€)	May 10, 2012 EUR (€)	Jun. 03, 2011 satellite	Jun. 30, 2016 EUR (€)	Dec. 31, 2015 EUR (€)	Jun. 30, 2016 USD ($)	Jun. 30, 2016 BRL	Dec. 31, 2015 USD ($)
Loss Contingencies [Line Items]
Number of satellites (in satellites) | satellite			25
Accrued liability for legal settlement						$ 1,422	BRL 4.5	$ 328
Thales Alenia Space
Loss Contingencies [Line Items]
Contract termination, damages awarded (in euros)		€ 51.3
Contract termination charge (in euros)		€ 53.0		€ 17.5	€ 17.5
Gain on release of liability (in euros)	€ 35.6
Settlement amount				€ 17.5

XML

Related Party Transactions - Narrative (Details) - USD ($)	1 Months Ended			3 Months Ended		6 Months Ended
	Jun. 30, 2016	Feb. 29, 2016	Aug. 31, 2015	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015	Dec. 31, 2015	Dec. 28, 2012	Jun. 30, 2011
Related Party Transaction [Line Items]
Payables to affiliates	$ 240,000			$ 240,000		$ 240,000		$ 616,000
Loss on equity issuance						1,923,000	$ 2,912,000
Debt instrument, face amount	664,765,000			664,765,000		664,765,000		675,815,000
Derivative liabilities	$ (200,482,000)			$ (200,482,000)		$ (200,482,000)		$ (239,642,000)
Warrants outstanding (in shares)	24,571,428			24,571,428		24,571,428		38,191,866
Maximum value of shares required to be purchased per terms of stock purchase agreement			$ 75,000,000.0						$ 30,000,000.0
Thermo Loan Agreement
Related Party Transaction [Line Items]
Debt instrument, face amount	$ 88,400,000			$ 88,400,000		$ 88,400,000		$ 83,222,000
Contingent Equity Agreement
Related Party Transaction [Line Items]
Warrants outstanding (in shares)	24,571,428			24,571,428		24,571,428		30,191,866
Number of warrants exercised (in shares)	5,600,000			5,600,000		5,600,000
Proceeds from warrant exercises	$ 100,000
5.00% Convertible Senior Unsecured Notes
Related Party Transaction [Line Items]
Warrants outstanding (in shares)	0			0		0		8,000,000
Number of warrants exercised (in shares)	8,000,000			8,000,000		8,000,000				15,200,000
Proceeds from warrant exercises	$ 2,500,000
Compound embedded derivative with the Amended and Restated Thermo Loan Agreement
Related Party Transaction [Line Items]
Derivative liabilities	(180,062,000)			$ (180,062,000)		$ (180,062,000)		$ (213,439,000)
Thermo
Related Party Transaction [Line Items]
Loss on equity issuance				200,000	$ 400,000	300,000	500,000
Maximum value of shares required to be purchased per terms of stock purchase agreement	$ 0		30,000,000.0	$ 0		$ 0
Thermo | Contingent Equity Agreement
Related Party Transaction [Line Items]
Warrants outstanding (in shares)	24,600,000			24,600,000		24,600,000
Proceeds from warrant exercises	$ 2,600,000
Thermo | Compound embedded derivative with the Amended and Restated Thermo Loan Agreement
Related Party Transaction [Line Items]
Interest Expense, Related Party				$ 2,600,000	$ 2,200,000	$ 5,200,000	4,200,000
Terrapin
Related Party Transaction [Line Items]
Maximum value of shares required to be purchased per terms of stock purchase agreement	31,500,000.0			$ 31,500,000.0		$ 31,500,000.0
Proceeds from lines of credit	$ 22,000,000	$ 6,500,000	$ 15,000,000				$ 24,000,000

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Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Accumulated other comprehensive loss, beginning of period	$ (5,484)	$ (4,188)	$ (4,833)	$ (2,898)
Other comprehensive income (loss):
Foreign currency translation adjustments	(925)	447	(1,576)	(843)
Accumulated other comprehensive loss, end of period	$ (6,409)	$ (3,741)	$ (6,409)	$ (3,741)

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Geographic Information - Information by Geographic Area Revenues (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Segment Reporting Information [Line Items]
Revenues	$ 25,086	$ 23,023	$ 46,922	$ 44,045
Operating Segments | Service
Segment Reporting Information [Line Items]
Revenues	20,970	18,616	39,719	35,723
Operating Segments | Service | United States
Segment Reporting Information [Line Items]
Revenues	14,407	12,468	27,676	24,183
Operating Segments | Service | Canada
Segment Reporting Information [Line Items]
Revenues	4,066	3,771	7,310	7,204
Operating Segments | Service | Europe
Segment Reporting Information [Line Items]
Revenues	1,805	1,541	3,263	2,743
Operating Segments | Service | Central and South America
Segment Reporting Information [Line Items]
Revenues	570	688	1,188	1,302
Operating Segments | Service | Others
Segment Reporting Information [Line Items]
Revenues	122	148	282	291
Operating Segments | Subscriber equipment
Segment Reporting Information [Line Items]
Revenues	4,116	4,407	7,203	8,322
Operating Segments | Subscriber equipment | United States
Segment Reporting Information [Line Items]
Revenues	2,226	1,990	3,530	3,578
Operating Segments | Subscriber equipment | Canada
Segment Reporting Information [Line Items]
Revenues	1,052	1,278	1,813	2,439
Operating Segments | Subscriber equipment | Europe
Segment Reporting Information [Line Items]
Revenues	527	452	956	985
Operating Segments | Subscriber equipment | Central and South America
Segment Reporting Information [Line Items]
Revenues	279	424	667	1,057
Operating Segments | Subscriber equipment | Others
Segment Reporting Information [Line Items]
Revenues	$ 32	$ 263	$ 237	$ 263

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Geographic Information - Information by Geographic Area, Property and Equipment (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Segment Reporting, Asset Reconciling Item [Line Items]
Property and equipment, net	$ 1,059,019	$ 1,077,560
Operating Segments
Segment Reporting, Asset Reconciling Item [Line Items]
Property and equipment, net	1,059,019	1,077,560
Operating Segments | United States
Segment Reporting, Asset Reconciling Item [Line Items]
Property and equipment, net	1,054,493	1,073,327
Operating Segments | Canada
Segment Reporting, Asset Reconciling Item [Line Items]
Property and equipment, net	626	510
Operating Segments | Europe
Segment Reporting, Asset Reconciling Item [Line Items]
Property and equipment, net	454	484
Operating Segments | Central and South America
Segment Reporting, Asset Reconciling Item [Line Items]
Property and equipment, net	3,126	2,782
Operating Segments | Others
Segment Reporting, Asset Reconciling Item [Line Items]
Property and equipment, net	$ 320	$ 457

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Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
Net income (loss)	$ 14,099	$ 204,767	$ (12,848)	$ 75,040
Income (loss) to common stockholders plus assumed conversions	$ 17,037	$ 207,508	$ (12,848)	$ 80,604
Weighted average common shares outstanding:
Basic (in shares)	1,049,381	1,009,917	1,045,205	1,005,406
Incremental shares from assumed exercises, conversions and other issuances:
Stock options, restricted stock, restricted stock units and ESPP (in shares)	5,793	8,667	0	8,534
Warrants (in shares)	27,625	38,192	0	38,192
Diluted (in shares)	1,249,672	1,205,450	1,045,205	1,199,182
Income (loss) per share:
Basic (USD per share)	$ 0.01	$ 0.20	$ (0.01)	$ 0.07
Diluted (USD per share)	$ 0.01	$ 0.17	$ (0.01)	$ 0.07
Antidilutive shares excluded from computation of earnings per share (in shares)			197,000
8.00% Convertible Senior Notes Issued in 2013
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
Dilutive Securities, Effect on Basic Earnings Per Share, Dilutive Convertible Securities	$ 537	$ 593	$ 0	$ 1,313
Incremental shares from assumed exercises, conversions and other issuances:
Conversion of debt securities (in shares)	27,164	28,001	0	27,778
Warrants Associated With Thermo Loan Agreement [Member]
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
Dilutive Securities, Effect on Basic Earnings Per Share, Dilutive Convertible Securities	$ 2,401	$ 2,148	$ 0	$ 4,251
Incremental shares from assumed exercises, conversions and other issuances:
Conversion of debt securities (in shares)	139,709	120,673	0	119,272

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Condensed Consolidating Financial Information - Narrative (Details)	Dec. 31, 2013
8.00% Convertible Senior Notes Issued in 2013
Condensed Financial Statements, Captions [Line Items]
Loan interest rate	8.00%

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Condensed Consolidating Statement of Operations (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Revenue:
Service revenues	$ 20,970	$ 18,616	$ 39,719	$ 35,723
Subscriber equipment sales	4,116	4,407	7,203	8,322
Total revenue	25,086	23,023	46,922	44,045
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	7,937	8,027	15,528	15,461
Cost of subscriber equipment sales	2,886	2,983	5,064	6,114
Marketing, general and administrative	11,450	10,159	20,060	18,755
Depreciation, amortization, and accretion	19,224	19,271	38,379	38,317
Total operating expenses	41,497	40,440	79,031	78,647
Loss from operations	(16,411)	(17,417)	(32,109)	(34,602)
Other income (expense):
Loss on extinguishment of debt	0	(2,189)	0	(2,254)
Loss on equity issuance	(2,075)	(2,912)	(1,923)	(2,912)
Interest income and expense, net of amounts capitalized	(9,049)	(9,244)	(18,154)	(17,761)
Derivative gain	40,499	237,087	39,155	129,222
Equity in subsidiary earnings (loss)	0	0	0	0
Other	685	(452)	(76)	3,681
Total other income (expense)	30,060	222,290	19,002	109,976
Income (loss) before income taxes	13,649	204,873	(13,107)	75,374
Income tax expense (benefit)	(450)	106	(259)	334
Net income (loss)	14,099	204,767	(12,848)	75,040
Comprehensive income (loss)	13,174	205,214	(14,424)	74,197
Reportable Legal Entities | Parent Company
Revenue:
Service revenues	10,944	15,932	27,882	32,175
Subscriber equipment sales	96	296	424	354
Total revenue	11,040	16,228	28,306	32,529
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	5,135	4,969	9,948	9,504
Cost of subscriber equipment sales	43	78	187	60
Marketing, general and administrative	5,430	4,940	10,604	9,449
Depreciation, amortization, and accretion	18,851	18,778	37,623	37,327
Total operating expenses	29,459	28,765	58,362	56,340
Loss from operations	(18,419)	(12,537)	(30,056)	(23,811)
Other income (expense):
Loss on extinguishment of debt		(2,189)		(2,254)
Loss on equity issuance	(2,075)	(2,912)	(1,923)	(2,912)
Interest income and expense, net of amounts capitalized	(9,000)	(9,107)	(17,981)	(17,443)
Derivative gain	40,499	237,087	39,155	129,222
Equity in subsidiary earnings (loss)	2,924	(5,035)	(1,427)	(8,949)
Other	170	(674)	(616)	1,132
Total other income (expense)	32,518	217,170	17,208	98,796
Income (loss) before income taxes	14,099	204,633	(12,848)	74,985
Income tax expense (benefit)	0	(134)	0	(55)
Net income (loss)	14,099	204,767	(12,848)	75,040
Comprehensive income (loss)	14,099	204,767	(12,848)	75,040
Reportable Legal Entities | Guarantor Subsidiaries
Revenue:
Service revenues	10,863	6,865	18,358	14,543
Subscriber equipment sales	2,774	2,615	4,466	6,064
Total revenue	13,637	9,480	22,824	20,607
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	1,034	1,652	2,070	3,177
Cost of subscriber equipment sales	2,112	2,137	3,540	5,443
Marketing, general and administrative	1,322	1,832	1,854	2,991
Depreciation, amortization, and accretion	206	293	426	591
Total operating expenses	4,674	5,914	7,890	12,202
Loss from operations	8,963	3,566	14,934	8,405
Other income (expense):
Loss on extinguishment of debt		0		0
Loss on equity issuance	0	0	0	0
Interest income and expense, net of amounts capitalized	(3)	(5)	(12)	(15)
Derivative gain	0	0	0	0
Equity in subsidiary earnings (loss)	(968)	1,161	2,079	5,426
Other	92	(132)	(112)	394
Total other income (expense)	(879)	1,024	1,955	5,805
Income (loss) before income taxes	8,084	4,590	16,889	14,210
Income tax expense (benefit)	0	(8)	0	15
Net income (loss)	8,084	4,598	16,889	14,195
Comprehensive income (loss)	8,084	4,598	16,889	14,195
Reportable Legal Entities | Non- Guarantor Subsidiaries
Revenue:
Service revenues	10,689	11,213	20,114	20,020
Subscriber equipment sales	1,997	2,993	3,674	5,491
Total revenue	12,686	14,206	23,788	25,511
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	2,702	3,037	5,597	6,289
Cost of subscriber equipment sales	1,478	3,286	2,693	5,732
Marketing, general and administrative	16,219	16,561	33,064	32,305
Depreciation, amortization, and accretion	288	329	569	652
Total operating expenses	20,687	23,213	41,923	44,978
Loss from operations	(8,001)	(9,007)	(18,135)	(19,467)
Other income (expense):
Loss on extinguishment of debt		0		0
Loss on equity issuance	0	0	0	0
Interest income and expense, net of amounts capitalized	(47)	(138)	(152)	(309)
Derivative gain	0	0	0	0
Equity in subsidiary earnings (loss)	0	0	0	0
Other	328	355	604	2,102
Total other income (expense)	281	217	452	1,793
Income (loss) before income taxes	(7,720)	(8,790)	(17,683)	(17,674)
Income tax expense (benefit)	(450)	248	(259)	374
Net income (loss)	(7,270)	(9,038)	(17,424)	(18,048)
Comprehensive income (loss)	(8,195)	(8,591)	(19,000)	(18,891)
Eliminations
Revenue:
Service revenues	(11,526)	(15,394)	(26,635)	(31,015)
Subscriber equipment sales	(751)	(1,497)	(1,361)	(3,587)
Total revenue	(12,277)	(16,891)	(27,996)	(34,602)
Operating expenses:
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)	(934)	(1,631)	(2,087)	(3,509)
Cost of subscriber equipment sales	(747)	(2,518)	(1,356)	(5,121)
Marketing, general and administrative	(11,521)	(13,174)	(25,462)	(25,990)
Depreciation, amortization, and accretion	(121)	(129)	(239)	(253)
Total operating expenses	(13,323)	(17,452)	(29,144)	(34,873)
Loss from operations	1,046	561	1,148	271
Other income (expense):
Loss on extinguishment of debt		0		0
Loss on equity issuance	0	0	0	0
Interest income and expense, net of amounts capitalized	1	6	(9)	6
Derivative gain	0	0	0	0
Equity in subsidiary earnings (loss)	(1,956)	3,874	(652)	3,523
Other	95	(1)	48	53
Total other income (expense)	(1,860)	3,879	(613)	3,582
Income (loss) before income taxes	(814)	4,440	535	3,853
Income tax expense (benefit)	0		0	0
Net income (loss)	(814)	4,440	535	3,853
Comprehensive income (loss)	$ (814)	$ 4,440	$ 535	$ 3,853

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Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015	Jun. 30, 2015	Dec. 31, 2014
Current assets:
Cash and cash equivalents	$ 11,269	$ 7,476	$ 12,871	$ 7,121
Accounts receivable	16,164	14,536
Intercompany receivables	0	0
Inventory	9,698	12,023
Prepaid expenses and other current assets	5,030	4,456
Total current assets	42,161	38,491
Property and equipment, net	1,059,019	1,077,560
Restricted cash	37,918	37,918
Intercompany notes receivable	0	0
Investment in subsidiaries	0	0
Prepaid second-generation ground costs	4,165	8,929
Intangible and other assets, net	13,497	12,117
Total assets	1,156,760	1,175,015
Current liabilities:
Current portion of long-term debt	38,112	32,835
Accounts payable	6,039	8,118
Accrued contract termination charge	19,468	19,121
Accrued expenses	26,955	22,439
Intercompany payables	0	0
Payables to affiliates	240	616
Deferred revenue	25,225	23,902
Total current liabilities	116,039	107,031
Long-term debt, less current portion	540,350	548,286
Employee benefit obligations	4,894	4,810
Intercompany notes payable	0	0
Derivative liabilities	200,482	239,642
Deferred revenue	6,125	6,413
Debt restructuring fees	20,795	20,795
Other non-current liabilities	11,931	10,907
Total non-current liabilities	784,577	830,853
Total stockholders’ equity	256,144	237,131
Total liabilities and stockholders’ equity	1,156,760	1,175,015
Reportable Legal Entities | Parent Company
Current assets:
Cash and cash equivalents	7,640	3,530	8,586	3,166
Accounts receivable	5,925	4,521
Intercompany receivables	869,736	859,370
Inventory	2,128	2,148
Prepaid expenses and other current assets	2,393	2,399
Total current assets	887,822	871,968
Property and equipment, net	1,051,013	1,069,605
Restricted cash	37,918	37,918
Intercompany notes receivable	10,717	12,037
Investment in subsidiaries	(272,351)	(298,976)
Prepaid second-generation ground costs	4,165	8,929
Intangible and other assets, net	12,739	11,384
Total assets	1,732,023	1,712,865
Current liabilities:
Current portion of long-term debt	38,112	32,835
Accounts payable	2,360	4,292
Accrued contract termination charge	19,468	19,121
Accrued expenses	13,378	9,816
Intercompany payables	620,440	580,383
Payables to affiliates	240	616
Deferred revenue	2,007	1,980
Total current liabilities	696,005	649,043
Long-term debt, less current portion	540,350	548,286
Employee benefit obligations	4,894	4,810
Intercompany notes payable	6,004	5,564
Derivative liabilities	200,482	239,642
Deferred revenue	5,834	6,027
Debt restructuring fees	20,795	20,795
Other non-current liabilities	1,515	1,567
Total non-current liabilities	779,874	826,691
Total stockholders’ equity	256,144	237,131
Total liabilities and stockholders’ equity	1,732,023	1,712,865
Reportable Legal Entities | Guarantor Subsidiaries
Current assets:
Cash and cash equivalents	807	719	459	672
Accounts receivable	6,022	5,215
Intercompany receivables	644,878	465,488
Inventory	5,058	6,321
Prepaid expenses and other current assets	330	291
Total current assets	657,095	478,034
Property and equipment, net	3,479	3,722
Restricted cash	0	0
Intercompany notes receivable	0	0
Investment in subsidiaries	23,009	9,512
Prepaid second-generation ground costs	0	0
Intangible and other assets, net	200	280
Total assets	683,783	491,548
Current liabilities:
Current portion of long-term debt	0	0
Accounts payable	2,571	2,439
Accrued contract termination charge	0	0
Accrued expenses	6,047	6,949
Intercompany payables	725,974	604,999
Payables to affiliates	0	0
Deferred revenue	17,691	17,722
Total current liabilities	752,283	632,109
Long-term debt, less current portion	0	0
Employee benefit obligations	0	0
Intercompany notes payable	0	0
Derivative liabilities	0	0
Deferred revenue	291	386
Debt restructuring fees	0	0
Other non-current liabilities	315	305
Total non-current liabilities	606	691
Total stockholders’ equity	(69,106)	(141,252)
Total liabilities and stockholders’ equity	683,783	491,548
Reportable Legal Entities | Non- Guarantor Subsidiaries
Current assets:
Cash and cash equivalents	2,822	3,227	3,826	3,283
Accounts receivable	4,217	4,461
Intercompany receivables	63,659	34,742
Inventory	2,512	3,554
Prepaid expenses and other current assets	2,307	1,766
Total current assets	75,517	47,750
Property and equipment, net	4,649	4,587
Restricted cash	0	0
Intercompany notes receivable	16,295	14,994
Investment in subsidiaries	34,404	32,946
Prepaid second-generation ground costs	0	0
Intangible and other assets, net	568	464
Total assets	131,433	100,741
Current liabilities:
Current portion of long-term debt	0	0
Accounts payable	1,108	1,387
Accrued contract termination charge	0	0
Accrued expenses	7,530	5,674
Intercompany payables	241,038	179,105
Payables to affiliates	0	0
Deferred revenue	5,527	4,200
Total current liabilities	255,203	190,366
Long-term debt, less current portion	0	0
Employee benefit obligations	0	0
Intercompany notes payable	12,860	13,970
Derivative liabilities	0	0
Deferred revenue	0	0
Debt restructuring fees	0	0
Other non-current liabilities	10,101	9,035
Total non-current liabilities	22,961	23,005
Total stockholders’ equity	(146,731)	(112,630)
Total liabilities and stockholders’ equity	131,433	100,741
Eliminations
Current assets:
Cash and cash equivalents	0	0	$ 0	$ 0
Accounts receivable	0	339
Intercompany receivables	(1,578,273)	(1,359,600)
Inventory	0	0
Prepaid expenses and other current assets	0	0
Total current assets	(1,578,273)	(1,359,261)
Property and equipment, net	(122)	(354)
Restricted cash	0	0
Intercompany notes receivable	(27,012)	(27,031)
Investment in subsidiaries	214,938	256,518
Prepaid second-generation ground costs	0	0
Intangible and other assets, net	(10)	(11)
Total assets	(1,390,479)	(1,130,139)
Current liabilities:
Current portion of long-term debt	0	0
Accounts payable	0	0
Accrued contract termination charge	0	0
Accrued expenses	0	0
Intercompany payables	(1,587,452)	(1,364,487)
Payables to affiliates	0	0
Deferred revenue	0	0
Total current liabilities	(1,587,452)	(1,364,487)
Long-term debt, less current portion	0	0
Employee benefit obligations	0	0
Intercompany notes payable	(18,864)	(19,534)
Derivative liabilities	0	0
Deferred revenue	0	0
Debt restructuring fees	0	0
Other non-current liabilities	0	0
Total non-current liabilities	(18,864)	(19,534)
Total stockholders’ equity	215,837	253,882
Total liabilities and stockholders’ equity	$ (1,390,479)	$ (1,130,139)

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Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Condensed Financial Statements, Captions [Line Items]
Cash flows provided by (used in) operating activities	$ 1,001	$ (1,262)
Cash flows used in investing activities:
Second-generation network costs (including interest)	(5,307)	(10,344)
Property and equipment additions	(6,345)	(2,325)
Purchase of intangible assets	(806)	(1,343)
Net cash used in investing activities	(12,458)	(14,012)
Cash flows provided by (used in) financing activities:
Principal payments of the Facility Agreement	(16,418)	(3,225)
Proceeds from issuance of stock to Terrapin	28,500	24,000
Proceeds from issuance of common stock and exercise of options and warrants	3,016	419
Net cash provided by financing activities	15,098	21,194
Effect of exchange rate changes on cash	152	(170)
Net increase in cash and cash equivalents	3,793	5,750
Cash and cash equivalents, beginning of period	7,476	7,121
Cash and cash equivalents, end of period	11,269	12,871
Reportable Legal Entities | Parent Company
Condensed Financial Statements, Captions [Line Items]
Cash flows provided by (used in) operating activities	916	(3,451)
Cash flows used in investing activities:
Second-generation network costs (including interest)	(5,161)	(10,344)
Property and equipment additions	(5,937)	(636)
Purchase of intangible assets	(806)	(1,343)
Net cash used in investing activities	(11,904)	(12,323)
Cash flows provided by (used in) financing activities:
Principal payments of the Facility Agreement	(16,418)	(3,225)
Proceeds from issuance of stock to Terrapin	28,500	24,000
Proceeds from issuance of common stock and exercise of options and warrants	3,016	419
Net cash provided by financing activities	15,098	21,194
Effect of exchange rate changes on cash	0	0
Net increase in cash and cash equivalents	4,110	5,420
Cash and cash equivalents, beginning of period	3,530	3,166
Cash and cash equivalents, end of period	7,640	8,586
Reportable Legal Entities | Guarantor Subsidiaries
Condensed Financial Statements, Captions [Line Items]
Cash flows provided by (used in) operating activities	255	1,239
Cash flows used in investing activities:
Second-generation network costs (including interest)	0	0
Property and equipment additions	(167)	(1,452)
Purchase of intangible assets	0
Net cash used in investing activities	(167)	(1,452)
Cash flows provided by (used in) financing activities:
Principal payments of the Facility Agreement	0
Proceeds from issuance of stock to Terrapin	0	0
Proceeds from issuance of common stock and exercise of options and warrants	0	0
Net cash provided by financing activities	0	0
Effect of exchange rate changes on cash	0	0
Net increase in cash and cash equivalents	88	(213)
Cash and cash equivalents, beginning of period	719	672
Cash and cash equivalents, end of period	807	459
Reportable Legal Entities | Non- Guarantor Subsidiaries
Condensed Financial Statements, Captions [Line Items]
Cash flows provided by (used in) operating activities	(170)	950
Cash flows used in investing activities:
Second-generation network costs (including interest)	(146)	0
Property and equipment additions	(241)	(237)
Purchase of intangible assets	0
Net cash used in investing activities	(387)	(237)
Cash flows provided by (used in) financing activities:
Principal payments of the Facility Agreement	0
Proceeds from issuance of stock to Terrapin	0	0
Proceeds from issuance of common stock and exercise of options and warrants	0	0
Net cash provided by financing activities	0	0
Effect of exchange rate changes on cash	152	(170)
Net increase in cash and cash equivalents	(405)	543
Cash and cash equivalents, beginning of period	3,227	3,283
Cash and cash equivalents, end of period	2,822	3,826
Eliminations
Condensed Financial Statements, Captions [Line Items]
Cash flows provided by (used in) operating activities	0	0
Cash flows used in investing activities:
Second-generation network costs (including interest)	0	0
Property and equipment additions	0	0
Purchase of intangible assets	0
Net cash used in investing activities	0	0
Cash flows provided by (used in) financing activities:
Principal payments of the Facility Agreement	0
Proceeds from issuance of stock to Terrapin	0	0
Proceeds from issuance of common stock and exercise of options and warrants	0	0
Net cash provided by financing activities	0	0
Effect of exchange rate changes on cash	0	0
Net increase in cash and cash equivalents	0	0
Cash and cash equivalents, beginning of period	0	0
Cash and cash equivalents, end of period	$ 0	$ 0