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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Globalstar Inc | AMEX:GSAT | AMEX | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-0.02 | -1.54% | 1.28 | 1.31 | 1.26 | 1.29 | 2,132,743 | 21:41:44 |
☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
41-2116508
|
(State or Other Jurisdiction of
|
|
(I.R.S. Employer Identification No.)
|
Incorporation or Organization)
|
|
|
Large accelerated filer ☒
|
|
Accelerated filer ☐
|
|
|
|
Non-accelerated filer ☐
|
|
Smaller reporting company ☐
|
(Do not check if a smaller reporting company)
|
|
Emerging growth company ☐
|
|
Page
|
|
PART I - F
INANCIAL INFORMATION
|
|
|
|
|
|
Item 1.
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 3.
|
||
|
|
|
Item 4.
|
||
|
|
|
PART II - O
THER INFORMATION
|
|
|
|
|
|
Item 1.
|
||
|
|
|
Item 1A.
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 3.
|
||
|
|
|
Item 4.
|
||
|
|
|
Item 5.
|
||
|
|
|
Item 6.
|
||
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30,
2018 |
|
June 30,
2017 |
|
June 30,
2018 |
|
June 30,
2017 |
||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
||||||
Service revenue
|
$
|
27,995
|
|
|
$
|
24,301
|
|
|
$
|
54,005
|
|
|
$
|
45,782
|
|
Subscriber equipment sales
|
5,731
|
|
|
3,822
|
|
|
8,470
|
|
|
6,993
|
|
||||
Total revenue
|
33,726
|
|
|
28,123
|
|
|
62,475
|
|
|
52,775
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
||||||
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)
|
9,526
|
|
|
9,036
|
|
|
18,555
|
|
|
18,010
|
|
||||
Cost of subscriber equipment sales
|
4,170
|
|
|
2,778
|
|
|
6,342
|
|
|
4,874
|
|
||||
Marketing, general and administrative
|
15,944
|
|
|
9,473
|
|
|
27,219
|
|
|
18,891
|
|
||||
Revision to contract termination charge
|
(20,478
|
)
|
|
—
|
|
|
(20,478
|
)
|
|
—
|
|
||||
Depreciation, amortization and accretion
|
22,616
|
|
|
19,275
|
|
|
41,847
|
|
|
38,569
|
|
||||
Total operating expenses
|
31,778
|
|
|
40,562
|
|
|
73,485
|
|
|
80,344
|
|
||||
Operating income (loss)
|
1,948
|
|
|
(12,439
|
)
|
|
(11,010
|
)
|
|
(27,569
|
)
|
||||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
||||||
Gain on equity issuance
|
—
|
|
|
1,964
|
|
|
—
|
|
|
2,670
|
|
||||
Interest income and expense, net of amounts capitalized
|
(10,305
|
)
|
|
(8,850
|
)
|
|
(17,658
|
)
|
|
(17,678
|
)
|
||||
Derivative gain (loss)
|
(2,059
|
)
|
|
(77,130
|
)
|
|
106,885
|
|
|
(73,907
|
)
|
||||
Gain on legal settlement
|
6,779
|
|
|
—
|
|
|
6,779
|
|
|
—
|
|
||||
Other
|
(3,351
|
)
|
|
(2,173
|
)
|
|
(4,013
|
)
|
|
(2,269
|
)
|
||||
Total other income (expense)
|
(8,936
|
)
|
|
(86,189
|
)
|
|
91,993
|
|
|
(91,184
|
)
|
||||
Income (loss) before income taxes
|
(6,988
|
)
|
|
(98,628
|
)
|
|
80,983
|
|
|
(118,753
|
)
|
||||
Income tax expense
|
24
|
|
|
106
|
|
|
65
|
|
|
142
|
|
||||
Net income (loss)
|
$
|
(7,012
|
)
|
|
$
|
(98,734
|
)
|
|
$
|
80,918
|
|
|
$
|
(118,895
|
)
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments
|
2,630
|
|
|
(45
|
)
|
|
2,300
|
|
|
(865
|
)
|
||||
Total comprehensive income (loss)
|
$
|
(4,382
|
)
|
|
$
|
(98,779
|
)
|
|
$
|
83,218
|
|
|
$
|
(119,760
|
)
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) per common share:
|
|
|
|
|
|
|
|
|
|
||||||
Basic
|
$
|
(0.01
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
0.06
|
|
|
$
|
(0.11
|
)
|
Diluted
|
(0.01
|
)
|
|
(0.09
|
)
|
|
0.06
|
|
|
(0.11
|
)
|
||||
Weighted-average shares outstanding:
|
|
|
|
|
|
|
|
|
|
||||||
Basic
|
1,263,372
|
|
|
1,128,985
|
|
|
1,262,857
|
|
|
1,121,518
|
|
||||
Diluted
|
1,263,372
|
|
|
1,128,985
|
|
|
1,442,693
|
|
|
1,121,518
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
ASSETS
|
|
|
|
|
|
||
Current assets:
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
12,806
|
|
|
$
|
41,644
|
|
Restricted cash
|
52,692
|
|
|
63,635
|
|
||
Accounts receivable, net of allowance of $3,537 and $3,610, respectively
|
19,886
|
|
|
17,113
|
|
||
Inventory
|
7,742
|
|
|
7,273
|
|
||
Prepaid expenses and other current assets
|
8,879
|
|
|
6,745
|
|
||
Total current assets
|
102,005
|
|
|
136,410
|
|
||
Property and equipment, net
|
935,036
|
|
|
971,119
|
|
||
Intangible and other assets, net of accumulated amortization of $7,540 and $7,314, respectively
|
31,395
|
|
|
21,736
|
|
||
Total assets
|
$
|
1,068,436
|
|
|
$
|
1,129,265
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
||
Current portion of long-term debt
|
$
|
87,732
|
|
|
$
|
79,215
|
|
Accounts payable
|
6,988
|
|
|
6,048
|
|
||
Accrued contract termination charge
|
—
|
|
|
21,002
|
|
||
Accrued expenses
|
22,890
|
|
|
20,754
|
|
||
Derivative liabilities
|
939
|
|
|
1,326
|
|
||
Payables to affiliates
|
286
|
|
|
225
|
|
||
Deferred revenue
|
33,047
|
|
|
31,747
|
|
||
Total current liabilities
|
151,882
|
|
|
160,317
|
|
||
Long-term debt, less current portion
|
400,727
|
|
|
434,651
|
|
||
Employee benefit obligations
|
4,458
|
|
|
4,389
|
|
||
Derivative liabilities
|
120,161
|
|
|
226,659
|
|
||
Deferred revenue
|
5,777
|
|
|
6,052
|
|
||
Other non-current liabilities
|
4,088
|
|
|
5,973
|
|
||
Total non-current liabilities
|
535,211
|
|
|
677,724
|
|
||
|
|
|
|
||||
Contingencies (Note 7)
|
|
|
|
|
|
||
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
|
|
||
Preferred Stock of $0.0001 par value; 100,000,000 shares authorized and none issued and outstanding at June 30, 2018 and December 31, 2017, respectively
|
—
|
|
|
—
|
|
||
Series A Preferred Convertible Stock of $0.0001 par value; one share authorized and none issued and outstanding at June 30, 2018 and December 31, 2017, respectively
|
—
|
|
|
—
|
|
||
Voting Common Stock of $0.0001 par value; 1,500,000,000 shares authorized; 1,264,104,858 and 1,261,949,123 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively
|
126
|
|
|
126
|
|
||
Nonvoting Common Stock of $0.0001 par value; 400,000,000 shares authorized and none issued and outstanding at June 30, 2018 and December 31, 2017, respectively
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
1,873,147
|
|
|
1,869,339
|
|
||
Accumulated other comprehensive loss
|
(4,639
|
)
|
|
(6,939
|
)
|
||
Retained deficit
|
(1,487,291
|
)
|
|
(1,571,302
|
)
|
||
Total stockholders’ equity
|
381,343
|
|
|
291,224
|
|
||
Total liabilities and stockholders’ equity
|
$
|
1,068,436
|
|
|
$
|
1,129,265
|
|
|
Impact on change in accounting policy
|
||||||||||||||||||||||
|
Three months ended June 30, 2018
|
|
Six months ended June 30, 2018
|
||||||||||||||||||||
|
As
reported
|
|
Impact of
ASC 606
|
|
Legacy GAAP
|
|
As
reported
|
|
Impact of
ASC 606 |
|
Legacy GAAP
|
||||||||||||
Service revenue
|
$
|
27,995
|
|
|
$
|
333
|
|
|
$
|
28,328
|
|
|
$
|
54,005
|
|
|
$
|
1,145
|
|
|
$
|
55,150
|
|
Subscriber equipment sales
|
5,731
|
|
|
(117
|
)
|
|
5,614
|
|
|
8,470
|
|
|
(81
|
)
|
|
8,389
|
|
||||||
Cost of subscriber equipment sales
|
4,170
|
|
|
(83
|
)
|
|
4,087
|
|
|
6,342
|
|
|
(64
|
)
|
|
6,278
|
|
||||||
Marketing, general and administrative
|
15,944
|
|
|
(6
|
)
|
|
15,938
|
|
|
27,219
|
|
|
(150
|
)
|
|
27,069
|
|
||||||
Other
|
(3,351
|
)
|
|
7
|
|
|
(3,344
|
)
|
|
(4,013
|
)
|
|
(42
|
)
|
|
(4,055
|
)
|
||||||
Net income (loss)
|
(7,012
|
)
|
|
298
|
|
|
(6,714
|
)
|
|
80,918
|
|
|
1,320
|
|
|
82,238
|
|
||||||
Total comprehensive income (loss)
|
(4,382
|
)
|
|
298
|
|
|
(4,084
|
)
|
|
83,218
|
|
|
1,320
|
|
|
84,538
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net income (loss) per common share:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic
|
$
|
(0.01
|
)
|
|
$
|
—
|
|
|
$
|
(0.01
|
)
|
|
$
|
0.06
|
|
|
$
|
0.01
|
|
|
$
|
0.07
|
|
Diluted
|
(0.01
|
)
|
|
—
|
|
|
(0.01
|
)
|
|
0.06
|
|
|
—
|
|
|
0.06
|
|
|
Impact on change in accounting policy
|
||||||||||
|
June 30, 2018
|
||||||||||
|
As
reported
|
|
Impact of
ASC 606
|
|
Legacy
GAAP
|
||||||
Accounts receivable, net
|
$
|
19,886
|
|
|
$
|
(219
|
)
|
|
$
|
19,667
|
|
Prepaid expenses and other current assets
|
8,879
|
|
|
47
|
|
|
8,926
|
|
|||
Intangible and other assets, net
|
31,395
|
|
|
(1,994
|
)
|
|
29,401
|
|
|||
Deferred revenue, current and long-term
|
38,824
|
|
|
(473
|
)
|
|
38,351
|
|
|||
Retained earnings (deficit)
|
(1,487,291
|
)
|
|
1,773
|
|
|
(1,485,518
|
)
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30, 2018
|
|
June 30, 2017
(1)
|
|
June 30, 2018
|
|
June 30, 2017
(1)
|
||||||||
Service revenue:
|
|
|
|
|
|
|
|
||||||||
Duplex
|
$
|
10,134
|
|
|
$
|
9,322
|
|
|
$
|
18,917
|
|
|
$
|
16,920
|
|
SPOT
|
13,868
|
|
|
11,193
|
|
|
26,830
|
|
|
21,590
|
|
||||
Simplex
|
3,216
|
|
|
2,526
|
|
|
6,305
|
|
|
4,942
|
|
||||
IGO
|
216
|
|
|
376
|
|
|
425
|
|
|
587
|
|
||||
Other
|
561
|
|
|
884
|
|
|
1,528
|
|
|
1,743
|
|
||||
Total service revenue
|
27,995
|
|
|
24,301
|
|
|
54,005
|
|
|
45,782
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Subscriber equipment sales:
|
|
|
|
|
|
|
|
||||||||
Duplex
|
$
|
750
|
|
|
$
|
612
|
|
|
$
|
1,181
|
|
|
$
|
1,511
|
|
SPOT
|
1,908
|
|
|
1,815
|
|
|
3,341
|
|
|
3,051
|
|
||||
Simplex
|
2,846
|
|
|
1,072
|
|
|
3,650
|
|
|
1,979
|
|
||||
IGO
|
136
|
|
|
330
|
|
|
206
|
|
|
469
|
|
||||
Other
|
91
|
|
|
(7
|
)
|
|
92
|
|
|
(17
|
)
|
||||
Total subscriber equipment sales
|
5,731
|
|
|
3,822
|
|
|
8,470
|
|
|
6,993
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Total revenue
|
$
|
33,726
|
|
|
$
|
28,123
|
|
|
$
|
62,475
|
|
|
$
|
52,775
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30, 2018
|
|
June 30, 2017
(1)
|
|
June 30, 2018
|
|
June 30, 2017
(1)
|
||||||||
Service revenue:
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
20,106
|
|
|
$
|
16,657
|
|
|
$
|
38,485
|
|
|
$
|
31,935
|
|
Canada
|
4,794
|
|
|
4,457
|
|
|
9,280
|
|
|
8,158
|
|
||||
Europe
|
2,404
|
|
|
2,223
|
|
|
4,650
|
|
|
3,954
|
|
||||
Central and South America
|
612
|
|
|
840
|
|
|
1,181
|
|
|
1,490
|
|
||||
Others
|
79
|
|
|
124
|
|
|
409
|
|
|
245
|
|
||||
Total service revenue
|
27,995
|
|
|
24,301
|
|
|
54,005
|
|
|
45,782
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Subscriber equipment sales:
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
3,460
|
|
|
$
|
2,334
|
|
|
$
|
5,055
|
|
|
$
|
4,114
|
|
Canada
|
793
|
|
|
828
|
|
|
1,143
|
|
|
1,542
|
|
||||
Europe
|
1,040
|
|
|
358
|
|
|
1,428
|
|
|
775
|
|
||||
Central and South America
|
338
|
|
|
294
|
|
|
726
|
|
|
553
|
|
||||
Others
|
100
|
|
|
8
|
|
|
118
|
|
|
9
|
|
||||
Total subscriber equipment sales
|
5,731
|
|
|
3,822
|
|
|
8,470
|
|
|
6,993
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Total revenue
|
$
|
33,726
|
|
|
$
|
28,123
|
|
|
$
|
62,475
|
|
|
$
|
52,775
|
|
|
June 30, 2018
|
|
January 1, 2018
|
||||
Accounts receivable
|
$
|
19,886
|
|
|
$
|
17,113
|
|
Capitalized costs to obtain a contract
|
2,082
|
|
|
2,265
|
|
||
Contract liabilities
|
38,824
|
|
|
37,799
|
|
|
June 30,
2018 |
|
December 31,
2017 |
||||
Globalstar System:
|
|
|
|
|
|
||
Space component
|
|
|
|
|
|
||
First and second-generation satellites in service
|
$
|
1,195,291
|
|
|
$
|
1,195,426
|
|
Second-generation satellite, on-ground spare
|
32,481
|
|
|
32,481
|
|
||
Ground component
|
211,048
|
|
|
48,710
|
|
||
Construction in progress:
|
|
|
|
|
|
||
Ground component
|
71,145
|
|
|
227,167
|
|
||
Next-generation software upgrades
|
1,314
|
|
|
12,414
|
|
||
Other
|
1,712
|
|
|
2,575
|
|
||
Total Globalstar System
|
1,512,991
|
|
|
1,518,773
|
|
||
Internally developed and purchased software
|
25,689
|
|
|
16,132
|
|
||
Equipment
|
10,656
|
|
|
9,966
|
|
||
Land and buildings
|
3,174
|
|
|
3,322
|
|
||
Leasehold improvements
|
1,970
|
|
|
1,969
|
|
||
Total property and equipment
|
1,554,480
|
|
|
1,550,162
|
|
||
Accumulated depreciation
|
(619,444
|
)
|
|
(579,043
|
)
|
||
Total property and equipment, net
|
$
|
935,036
|
|
|
$
|
971,119
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
Principal
Amount
|
|
Unamortized Discount and Deferred Financing Costs
|
|
Carrying
Value
|
|
Principal
Amount
|
|
Unamortized Discount and Deferred Financing Costs
|
|
Carrying
Value
|
||||||||||||
Facility Agreement
|
$
|
428,323
|
|
|
$
|
29,277
|
|
|
$
|
399,046
|
|
|
$
|
467,256
|
|
|
$
|
34,459
|
|
|
$
|
432,797
|
|
Loan Agreement with Thermo
|
112,616
|
|
|
24,566
|
|
|
88,050
|
|
|
106,054
|
|
|
26,333
|
|
|
79,721
|
|
||||||
8.00% Convertible Senior Notes Issued in 2013
|
1,363
|
|
|
—
|
|
|
1,363
|
|
|
1,348
|
|
|
—
|
|
|
1,348
|
|
||||||
Total Debt
|
542,302
|
|
|
53,843
|
|
|
488,459
|
|
|
574,658
|
|
|
60,792
|
|
|
513,866
|
|
||||||
Less: Current Portion
|
87,732
|
|
|
—
|
|
|
87,732
|
|
|
79,215
|
|
|
—
|
|
|
79,215
|
|
||||||
Long-Term Debt
|
$
|
454,570
|
|
|
$
|
53,843
|
|
|
$
|
400,727
|
|
|
$
|
495,443
|
|
|
$
|
60,792
|
|
|
$
|
434,651
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
Derivative liabilities:
|
|
|
|
|
|
||
Compound embedded derivative with the 2013 8.00% Notes
|
$
|
(939
|
)
|
|
$
|
(1,326
|
)
|
Compound embedded derivative with the Loan Agreement with Thermo
|
(120,161
|
)
|
|
(226,659
|
)
|
||
Total derivative liabilities
|
$
|
(121,100
|
)
|
|
$
|
(227,985
|
)
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
June 30, 2018
|
|
June 30, 2017
|
|
June 30, 2018
|
|
June 30, 2017
|
||||||||
Interest rate cap
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
Compound embedded derivative with the 2013 8.00% Notes
|
(934
|
)
|
|
(11,354
|
)
|
|
387
|
|
|
(10,196
|
)
|
||||
Compound embedded derivative with the Loan Agreement with Thermo
|
(1,125
|
)
|
|
(65,775
|
)
|
|
106,498
|
|
|
(63,708
|
)
|
||||
Total derivative gain (loss)
|
$
|
(2,059
|
)
|
|
$
|
(77,130
|
)
|
|
$
|
106,885
|
|
|
$
|
(73,907
|
)
|
|
June 30, 2018
|
||||||||||||||
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
Total
Balance
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Compound embedded derivative with the 2013 8.00% Notes
|
—
|
|
|
—
|
|
|
(939
|
)
|
|
(939
|
)
|
||||
Compound embedded derivative with the Loan Agreement with Thermo
|
—
|
|
|
—
|
|
|
(120,161
|
)
|
|
(120,161
|
)
|
||||
Total liabilities measured at fair value
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(121,100
|
)
|
|
$
|
(121,100
|
)
|
|
December 31, 2017
|
||||||||||||||
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
Total
Balance
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Compound embedded derivative with the 2013 8.00% Notes
|
—
|
|
|
—
|
|
|
(1,326
|
)
|
|
(1,326
|
)
|
||||
Compound embedded derivative with the Loan Agreement with Thermo
|
—
|
|
|
—
|
|
|
(226,659
|
)
|
|
(226,659
|
)
|
||||
Total liabilities measured at fair value
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(227,985
|
)
|
|
$
|
(227,985
|
)
|
|
June 30, 2018
|
||||||||||||||
|
Stock Price
Volatility
|
|
Risk-Free
Interest
Rate
|
|
Note
Conversion
Price
|
|
Discount Rate
|
|
Market Price of Common Stock
|
||||||
Compound embedded derivative with the 2013 8.00% Notes
|
40% - 130%
|
|
2.7
|
%
|
|
$
|
0.73
|
|
|
25
|
%
|
|
$
|
0.49
|
|
Compound embedded derivative with the Loan Agreement with Thermo
|
40% - 130%
|
|
2.7
|
%
|
|
$
|
0.73
|
|
|
25
|
%
|
|
$
|
0.49
|
|
|
December 31, 2017
|
|||||||||||||||
|
Stock Price
Volatility
|
|
Risk-Free
Interest
Rate
|
|
Note
Conversion
Price
|
|
Discount Rate
|
|
Market Price of Common Stock
|
|||||||
Compound embedded derivative with the 2013 8.00% Notes
|
78
|
%
|
|
1.4
|
%
|
|
$
|
0.73
|
|
|
27
|
%
|
|
$
|
1.31
|
|
Compound embedded derivative with the Loan Agreement with Thermo
|
40% - 77%
|
|
|
2.2
|
%
|
|
$
|
0.73
|
|
|
27
|
%
|
|
$
|
1.31
|
|
|
Three Months Ended June 30,
|
|
Six months ended June 30,
|
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Balance at beginning of period
|
$
|
(119,041
|
)
|
|
$
|
(277,946
|
)
|
|
$
|
(227,985
|
)
|
|
$
|
(281,171
|
)
|
Unrealized gain (loss), included in derivative gain (loss)
|
(2,059
|
)
|
|
(77,129
|
)
|
|
106,885
|
|
|
(73,904
|
)
|
||||
Balance at end of period
|
$
|
(121,100
|
)
|
|
$
|
(355,075
|
)
|
|
$
|
(121,100
|
)
|
|
$
|
(355,075
|
)
|
|
June 30, 2018
|
|
December 31, 2017
|
||||||||||||
|
Carrying Value
|
|
Estimated Fair Value
|
|
Carrying Value
|
|
Estimated Fair Value
|
||||||||
Loan Agreement with Thermo
|
$
|
88,050
|
|
|
$
|
67,040
|
|
|
$
|
79,721
|
|
|
$
|
54,936
|
|
2013 8.00% Notes
|
1,363
|
|
|
751
|
|
|
1,348
|
|
|
1,295
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net income (loss)
|
$
|
(7,012
|
)
|
|
$
|
(98,734
|
)
|
|
$
|
80,918
|
|
|
$
|
(118,895
|
)
|
Effect of dilutive securities:
|
|
|
|
|
|
|
|
||||||||
2013 8.00% Notes
|
—
|
|
|
—
|
|
|
38
|
|
|
—
|
|
||||
Loan Agreement with Thermo
|
—
|
|
|
—
|
|
|
5,855
|
|
|
—
|
|
||||
Income (loss) to common stockholders plus assumed conversions
|
$
|
(7,012
|
)
|
|
$
|
(98,734
|
)
|
|
$
|
86,811
|
|
|
$
|
(118,895
|
)
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
||||||||
Basic shares outstanding
|
1,263,372
|
|
|
1,128,985
|
|
|
1,262,857
|
|
|
1,121,518
|
|
||||
Incremental shares from assumed exercises, conversions and other issuance of:
|
|
|
|
|
|
|
|
||||||||
Stock options, restricted stock, restricted stock units and ESPP
|
—
|
|
|
—
|
|
|
5,335
|
|
|
—
|
|
||||
2013 8.00% Notes
|
—
|
|
|
—
|
|
|
2,087
|
|
|
—
|
|
||||
Loan Agreement with Thermo
|
—
|
|
|
—
|
|
|
172,414
|
|
|
—
|
|
||||
Diluted shares outstanding
|
1,263,372
|
|
|
1,128,985
|
|
|
1,442,693
|
|
|
1,121,518
|
|
||||
Net income (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.01
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
0.06
|
|
|
$
|
(0.11
|
)
|
Diluted
|
(0.01
|
)
|
|
(0.09
|
)
|
|
0.06
|
|
|
(0.11
|
)
|
|
Parent
Company
|
|
Guarantor
Subsidiaries
|
|
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Service revenue
|
$
|
23,270
|
|
|
$
|
10,292
|
|
|
$
|
16,406
|
|
|
$
|
(21,973
|
)
|
|
$
|
27,995
|
|
Subscriber equipment sales
|
204
|
|
|
5,348
|
|
|
1,375
|
|
|
(1,196
|
)
|
|
5,731
|
|
|||||
Total revenue
|
23,474
|
|
|
15,640
|
|
|
17,781
|
|
|
(23,169
|
)
|
|
33,726
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)
|
6,745
|
|
|
1,498
|
|
|
2,294
|
|
|
(1,011
|
)
|
|
9,526
|
|
|||||
Cost of subscriber equipment sales
|
165
|
|
|
4,281
|
|
|
919
|
|
|
(1,195
|
)
|
|
4,170
|
|
|||||
Marketing, general and administrative
|
11,382
|
|
|
1,457
|
|
|
24,078
|
|
|
(20,973
|
)
|
|
15,944
|
|
|||||
Revision to contract termination charge
|
(20,478
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(20,478
|
)
|
|||||
Depreciation, amortization and accretion
|
21,349
|
|
|
68
|
|
|
1,199
|
|
|
—
|
|
|
22,616
|
|
|||||
Total operating expenses
|
19,163
|
|
|
7,304
|
|
|
28,490
|
|
|
(23,179
|
)
|
|
31,778
|
|
|||||
Income (loss) from operations
|
4,311
|
|
|
8,336
|
|
|
(10,709
|
)
|
|
10
|
|
|
1,948
|
|
|||||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest income and expense, net of amounts capitalized
|
(10,335
|
)
|
|
(2
|
)
|
|
3
|
|
|
29
|
|
|
(10,305
|
)
|
|||||
Derivative loss
|
(2,059
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,059
|
)
|
|||||
Gain on legal settlement
|
6,779
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,779
|
|
|||||
Equity in subsidiary earnings (loss)
|
(5,800
|
)
|
|
(6,241
|
)
|
|
—
|
|
|
12,041
|
|
|
—
|
|
|||||
Other
|
92
|
|
|
293
|
|
|
(3,725
|
)
|
|
(11
|
)
|
|
(3,351
|
)
|
|||||
Total other income (expense)
|
(11,323
|
)
|
|
(5,950
|
)
|
|
(3,722
|
)
|
|
12,059
|
|
|
(8,936
|
)
|
|||||
Income (loss) before income taxes
|
(7,012
|
)
|
|
2,386
|
|
|
(14,431
|
)
|
|
12,069
|
|
|
(6,988
|
)
|
|||||
Income tax expense
|
—
|
|
|
10
|
|
|
14
|
|
|
—
|
|
|
24
|
|
|||||
Net income (loss)
|
$
|
(7,012
|
)
|
|
$
|
2,376
|
|
|
$
|
(14,445
|
)
|
|
$
|
12,069
|
|
|
$
|
(7,012
|
)
|
Comprehensive income (loss)
|
$
|
(7,012
|
)
|
|
$
|
2,376
|
|
|
$
|
(11,793
|
)
|
|
$
|
12,047
|
|
|
$
|
(4,382
|
)
|
|
Parent
Company
|
|
Guarantor
Subsidiaries
|
|
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Service revenue
|
$
|
18,685
|
|
|
$
|
9,846
|
|
|
$
|
13,096
|
|
|
$
|
(17,326
|
)
|
|
$
|
24,301
|
|
Subscriber equipment sales
|
60
|
|
|
3,702
|
|
|
1,491
|
|
|
(1,431
|
)
|
|
3,822
|
|
|||||
Total revenue
|
18,745
|
|
|
13,548
|
|
|
14,587
|
|
|
(18,757
|
)
|
|
28,123
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)
|
6,415
|
|
|
1,403
|
|
|
1,974
|
|
|
(756
|
)
|
|
9,036
|
|
|||||
Cost of subscriber equipment sales
|
32
|
|
|
3,106
|
|
|
1,525
|
|
|
(1,885
|
)
|
|
2,778
|
|
|||||
Marketing, general and administrative
|
5,241
|
|
|
997
|
|
|
19,357
|
|
|
(16,122
|
)
|
|
9,473
|
|
|||||
Depreciation, amortization and accretion
|
19,101
|
|
|
120
|
|
|
54
|
|
|
—
|
|
|
19,275
|
|
|||||
Total operating expenses
|
30,789
|
|
|
5,626
|
|
|
22,910
|
|
|
(18,763
|
)
|
|
40,562
|
|
|||||
Income (loss) from operations
|
(12,044
|
)
|
|
7,922
|
|
|
(8,323
|
)
|
|
6
|
|
|
(12,439
|
)
|
|||||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Gain on equity issuance
|
1,964
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,964
|
|
|||||
Interest income and expense, net of amounts capitalized
|
(8,829
|
)
|
|
7
|
|
|
(32
|
)
|
|
4
|
|
|
(8,850
|
)
|
|||||
Derivative loss
|
(77,130
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(77,130
|
)
|
|||||
Equity in subsidiary earnings (loss)
|
(1,282
|
)
|
|
(4,076
|
)
|
|
—
|
|
|
5,358
|
|
|
—
|
|
|||||
Other
|
(1,413
|
)
|
|
(337
|
)
|
|
(418
|
)
|
|
(5
|
)
|
|
(2,173
|
)
|
|||||
Total other income (expense)
|
(86,690
|
)
|
|
(4,406
|
)
|
|
(450
|
)
|
|
5,357
|
|
|
(86,189
|
)
|
|||||
Income (loss) before income taxes
|
(98,734
|
)
|
|
3,516
|
|
|
(8,773
|
)
|
|
5,363
|
|
|
(98,628
|
)
|
|||||
Income tax expense
|
—
|
|
|
4
|
|
|
102
|
|
|
—
|
|
|
106
|
|
|||||
Net income (loss)
|
$
|
(98,734
|
)
|
|
$
|
3,512
|
|
|
$
|
(8,875
|
)
|
|
$
|
5,363
|
|
|
$
|
(98,734
|
)
|
Comprehensive income (loss)
|
$
|
(98,734
|
)
|
|
$
|
3,512
|
|
|
$
|
(8,911
|
)
|
|
$
|
5,354
|
|
|
$
|
(98,779
|
)
|
|
Parent
Company |
|
Guarantor
Subsidiaries |
|
Non-
Guarantor Subsidiaries |
|
Eliminations
|
|
Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Service revenue
|
$
|
43,804
|
|
|
$
|
19,366
|
|
|
$
|
32,014
|
|
|
$
|
(41,179
|
)
|
|
$
|
54,005
|
|
Subscriber equipment sales
|
251
|
|
|
7,397
|
|
|
2,571
|
|
|
(1,749
|
)
|
|
8,470
|
|
|||||
Total revenue
|
44,055
|
|
|
26,763
|
|
|
34,585
|
|
|
(42,928
|
)
|
|
62,475
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)
|
13,002
|
|
|
2,888
|
|
|
5,162
|
|
|
(2,497
|
)
|
|
18,555
|
|
|||||
Cost of subscriber equipment sales
|
206
|
|
|
6,091
|
|
|
1,794
|
|
|
(1,749
|
)
|
|
6,342
|
|
|||||
Marketing, general and administrative
|
18,467
|
|
|
2,521
|
|
|
44,941
|
|
|
(38,710
|
)
|
|
27,219
|
|
|||||
Revision to contract termination charge
|
(20,478
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(20,478
|
)
|
|||||
Depreciation, amortization and accretion
|
40,393
|
|
|
164
|
|
|
1,290
|
|
|
—
|
|
|
41,847
|
|
|||||
Total operating expenses
|
51,590
|
|
|
11,664
|
|
|
53,187
|
|
|
(42,956
|
)
|
|
73,485
|
|
|||||
Income (loss) from operations
|
(7,535
|
)
|
|
15,099
|
|
|
(18,602
|
)
|
|
28
|
|
|
(11,010
|
)
|
|||||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest income and expense, net of amounts capitalized
|
(17,721
|
)
|
|
(4
|
)
|
|
17
|
|
|
50
|
|
|
(17,658
|
)
|
|||||
Derivative gain
|
106,885
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
106,885
|
|
|||||
Gain on legal settlement
|
6,779
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,779
|
|
|||||
Equity in subsidiary earnings (loss)
|
(7,120
|
)
|
|
(9,628
|
)
|
|
—
|
|
|
16,748
|
|
|
—
|
|
|||||
Other
|
(370
|
)
|
|
117
|
|
|
(3,733
|
)
|
|
(27
|
)
|
|
(4,013
|
)
|
|||||
Total other income (expense)
|
88,453
|
|
|
(9,515
|
)
|
|
(3,716
|
)
|
|
16,771
|
|
|
91,993
|
|
|||||
Income (loss) before income taxes
|
80,918
|
|
|
5,584
|
|
|
(22,318
|
)
|
|
16,799
|
|
|
80,983
|
|
|||||
Income tax expense
|
—
|
|
|
16
|
|
|
49
|
|
|
—
|
|
|
65
|
|
|||||
Net income (loss)
|
$
|
80,918
|
|
|
$
|
5,568
|
|
|
$
|
(22,367
|
)
|
|
$
|
16,799
|
|
|
$
|
80,918
|
|
Comprehensive income (loss)
|
$
|
80,918
|
|
|
$
|
5,568
|
|
|
$
|
(20,039
|
)
|
|
$
|
16,771
|
|
|
$
|
83,218
|
|
|
Parent
Company |
|
Guarantor
Subsidiaries |
|
Non-
Guarantor Subsidiaries |
|
Eliminations
|
|
Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Service revenue
|
$
|
36,297
|
|
|
$
|
19,202
|
|
|
$
|
24,097
|
|
|
$
|
(33,814
|
)
|
|
$
|
45,782
|
|
Subscriber equipment sales
|
127
|
|
|
5,993
|
|
|
2,841
|
|
|
(1,968
|
)
|
|
6,993
|
|
|||||
Total revenue
|
36,424
|
|
|
25,195
|
|
|
26,938
|
|
|
(35,782
|
)
|
|
52,775
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cost of services (exclusive of depreciation, amortization, and accretion shown separately below)
|
12,543
|
|
|
2,828
|
|
|
5,147
|
|
|
(2,508
|
)
|
|
18,010
|
|
|||||
Cost of subscriber equipment sales
|
66
|
|
|
4,823
|
|
|
1,952
|
|
|
(1,967
|
)
|
|
4,874
|
|
|||||
Marketing, general and administrative
|
10,828
|
|
|
2,116
|
|
|
37,265
|
|
|
(31,318
|
)
|
|
18,891
|
|
|||||
Depreciation, amortization and accretion
|
38,052
|
|
|
402
|
|
|
115
|
|
|
—
|
|
|
38,569
|
|
|||||
Total operating expenses
|
61,489
|
|
|
10,169
|
|
|
44,479
|
|
|
(35,793
|
)
|
|
80,344
|
|
|||||
Income (loss) from operations
|
(25,065
|
)
|
|
15,026
|
|
|
(17,541
|
)
|
|
11
|
|
|
(27,569
|
)
|
|||||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Gain (loss) on equity issuance
|
2,706
|
|
|
—
|
|
|
(36
|
)
|
|
—
|
|
|
2,670
|
|
|||||
Interest income and expense, net of amounts capitalized
|
(17,584
|
)
|
|
(1
|
)
|
|
(101
|
)
|
|
8
|
|
|
(17,678
|
)
|
|||||
Derivative loss
|
(73,907
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(73,907
|
)
|
|||||
Equity in subsidiary earnings (loss)
|
(3,215
|
)
|
|
(7,510
|
)
|
|
—
|
|
|
10,725
|
|
|
—
|
|
|||||
Other
|
(1,830
|
)
|
|
(437
|
)
|
|
5
|
|
|
(7
|
)
|
|
(2,269
|
)
|
|||||
Total other income (expense)
|
(93,830
|
)
|
|
(7,948
|
)
|
|
(132
|
)
|
|
10,726
|
|
|
(91,184
|
)
|
|||||
Income (loss) before income taxes
|
(118,895
|
)
|
|
7,078
|
|
|
(17,673
|
)
|
|
10,737
|
|
|
(118,753
|
)
|
|||||
Income tax expense
|
—
|
|
|
9
|
|
|
133
|
|
|
—
|
|
|
142
|
|
|||||
Net income (loss)
|
$
|
(118,895
|
)
|
|
$
|
7,069
|
|
|
$
|
(17,806
|
)
|
|
$
|
10,737
|
|
|
$
|
(118,895
|
)
|
Comprehensive income (loss)
|
$
|
(118,895
|
)
|
|
$
|
7,069
|
|
|
$
|
(18,662
|
)
|
|
$
|
10,728
|
|
|
$
|
(119,760
|
)
|
|
Parent
Company
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
$
|
7,955
|
|
|
$
|
1,556
|
|
|
$
|
3,295
|
|
|
$
|
—
|
|
|
$
|
12,806
|
|
Restricted cash
|
52,692
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
52,692
|
|
|||||
Accounts receivable, net of allowance
|
6,451
|
|
|
9,595
|
|
|
3,840
|
|
|
—
|
|
|
19,886
|
|
|||||
Intercompany receivables
|
1,083,354
|
|
|
790,014
|
|
|
85,101
|
|
|
(1,958,469
|
)
|
|
—
|
|
|||||
Inventory
|
1,105
|
|
|
5,260
|
|
|
1,377
|
|
|
—
|
|
|
7,742
|
|
|||||
Prepaid expenses and other current assets
|
6,055
|
|
|
1,435
|
|
|
1,389
|
|
|
—
|
|
|
8,879
|
|
|||||
Total current assets
|
1,157,612
|
|
|
807,860
|
|
|
95,002
|
|
|
(1,958,469
|
)
|
|
102,005
|
|
|||||
Property and equipment, net
|
855,526
|
|
|
1,322
|
|
|
78,183
|
|
|
5
|
|
|
935,036
|
|
|||||
Intercompany notes receivable
|
5,600
|
|
|
—
|
|
|
6,436
|
|
|
(12,036
|
)
|
|
—
|
|
|||||
Investment in subsidiaries
|
(281,595
|
)
|
|
58,583
|
|
|
40,367
|
|
|
182,645
|
|
|
—
|
|
|||||
Intangible and other assets, net
|
28,005
|
|
|
387
|
|
|
3,015
|
|
|
(12
|
)
|
|
31,395
|
|
|||||
Total assets
|
$
|
1,765,148
|
|
|
$
|
868,152
|
|
|
$
|
223,003
|
|
|
$
|
(1,787,867
|
)
|
|
$
|
1,068,436
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current portion of long-term debt
|
$
|
87,732
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
87,732
|
|
Accounts payable
|
2,436
|
|
|
3,152
|
|
|
1,400
|
|
|
—
|
|
|
6,988
|
|
|||||
Accrued expenses
|
10,198
|
|
|
7,397
|
|
|
5,295
|
|
|
—
|
|
|
22,890
|
|
|||||
Intercompany payables
|
742,918
|
|
|
812,978
|
|
|
402,534
|
|
|
(1,958,430
|
)
|
|
—
|
|
|||||
Payables to affiliates
|
286
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
286
|
|
|||||
Derivative liabilities
|
939
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
939
|
|
|||||
Deferred revenue
|
1,498
|
|
|
24,073
|
|
|
7,476
|
|
|
—
|
|
|
33,047
|
|
|||||
Total current liabilities
|
846,007
|
|
|
847,600
|
|
|
416,705
|
|
|
(1,958,430
|
)
|
|
151,882
|
|
|||||
Long-term debt, less current portion
|
400,727
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
400,727
|
|
|||||
Employee benefit obligations
|
4,458
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,458
|
|
|||||
Intercompany notes payable
|
6,436
|
|
|
—
|
|
|
5,600
|
|
|
(12,036
|
)
|
|
—
|
|
|||||
Derivative liabilities
|
120,161
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
120,161
|
|
|||||
Deferred revenue
|
5,456
|
|
|
304
|
|
|
17
|
|
|
—
|
|
|
5,777
|
|
|||||
Other non-current liabilities
|
560
|
|
|
324
|
|
|
3,204
|
|
|
—
|
|
|
4,088
|
|
|||||
Total non-current liabilities
|
537,798
|
|
|
628
|
|
|
8,821
|
|
|
(12,036
|
)
|
|
535,211
|
|
|||||
Stockholders’ equity (deficit)
|
381,343
|
|
|
19,924
|
|
|
(202,523
|
)
|
|
182,599
|
|
|
381,343
|
|
|||||
Total liabilities and stockholders’ equity
|
$
|
1,765,148
|
|
|
$
|
868,152
|
|
|
$
|
223,003
|
|
|
$
|
(1,787,867
|
)
|
|
$
|
1,068,436
|
|
|
Parent
Company
|
|
Guarantor
Subsidiaries
|
|
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
$
|
32,864
|
|
|
$
|
4,942
|
|
|
$
|
3,838
|
|
|
$
|
—
|
|
|
$
|
41,644
|
|
Restricted cash
|
63,635
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
63,635
|
|
|||||
Accounts receivable, net of allowance
|
7,129
|
|
|
6,524
|
|
|
3,460
|
|
|
—
|
|
|
17,113
|
|
|||||
Intercompany receivables
|
979,942
|
|
|
755,847
|
|
|
64,477
|
|
|
(1,800,266
|
)
|
|
—
|
|
|||||
Inventory
|
1,182
|
|
|
4,610
|
|
|
1,481
|
|
|
—
|
|
|
7,273
|
|
|||||
Prepaid expenses and other current assets
|
3,149
|
|
|
2,414
|
|
|
1,182
|
|
|
—
|
|
|
6,745
|
|
|||||
Total current assets
|
1,087,901
|
|
|
774,337
|
|
|
74,438
|
|
|
(1,800,266
|
)
|
|
136,410
|
|
|||||
Property and equipment, net
|
962,756
|
|
|
3,855
|
|
|
4,503
|
|
|
5
|
|
|
971,119
|
|
|||||
Intercompany notes receivable
|
5,600
|
|
|
—
|
|
|
6,436
|
|
|
(12,036
|
)
|
|
—
|
|
|||||
Investment in subsidiaries
|
(280,745
|
)
|
|
84,244
|
|
|
38,637
|
|
|
157,864
|
|
|
—
|
|
|||||
Intangible and other assets, net
|
18,353
|
|
|
47
|
|
|
3,348
|
|
|
(12
|
)
|
|
21,736
|
|
|||||
Total assets
|
$
|
1,793,865
|
|
|
$
|
862,483
|
|
|
$
|
127,362
|
|
|
$
|
(1,654,445
|
)
|
|
$
|
1,129,265
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Current portion of long-term debt
|
$
|
79,215
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
79,215
|
|
Accounts payable
|
2,257
|
|
|
2,736
|
|
|
1,055
|
|
|
—
|
|
|
6,048
|
|
|||||
Accrued contract termination charge
|
21,002
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21,002
|
|
|||||
Accrued expenses
|
7,627
|
|
|
6,331
|
|
|
6,796
|
|
|
—
|
|
|
20,754
|
|
|||||
Intercompany payables
|
711,159
|
|
|
799,565
|
|
|
289,503
|
|
|
(1,800,227
|
)
|
|
—
|
|
|||||
Payables to affiliates
|
225
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
225
|
|
|||||
Derivative liabilities
|
1,326
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,326
|
|
|||||
Deferred revenue
|
1,164
|
|
|
23,282
|
|
|
7,301
|
|
|
—
|
|
|
31,747
|
|
|||||
Total current liabilities
|
823,975
|
|
|
831,914
|
|
|
304,655
|
|
|
(1,800,227
|
)
|
|
160,317
|
|
|||||
Long-term debt, less current portion
|
434,651
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
434,651
|
|
|||||
Employee benefit obligations
|
4,389
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,389
|
|
|||||
Intercompany notes payable
|
6,436
|
|
|
—
|
|
|
5,600
|
|
|
(12,036
|
)
|
|
—
|
|
|||||
Derivative liabilities
|
226,659
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
226,659
|
|
|||||
Deferred revenue
|
5,625
|
|
|
410
|
|
|
17
|
|
|
—
|
|
|
6,052
|
|
|||||
Other non-current liabilities
|
906
|
|
|
325
|
|
|
4,742
|
|
|
—
|
|
|
5,973
|
|
|||||
Total non-current liabilities
|
678,666
|
|
|
735
|
|
|
10,359
|
|
|
(12,036
|
)
|
|
677,724
|
|
|||||
Stockholders’ equity (deficit)
|
291,224
|
|
|
29,834
|
|
|
(187,652
|
)
|
|
157,818
|
|
|
291,224
|
|
|||||
Total liabilities and stockholders’ equity
|
$
|
1,793,865
|
|
|
$
|
862,483
|
|
|
$
|
127,362
|
|
|
$
|
(1,654,445
|
)
|
|
$
|
1,129,265
|
|
|
Parent
Company
|
|
Guarantor
Subsidiaries
|
|
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Cash flows provided by (used in) operating activities
|
$
|
10,592
|
|
|
$
|
(2,545
|
)
|
|
$
|
(242
|
)
|
|
$
|
—
|
|
|
$
|
7,805
|
|
Cash flows used in investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Second-generation network costs (including interest)
|
(4,254
|
)
|
|
—
|
|
|
(23
|
)
|
|
—
|
|
|
(4,277
|
)
|
|||||
Property and equipment additions
|
(2,207
|
)
|
|
(841
|
)
|
|
(173
|
)
|
|
—
|
|
|
(3,221
|
)
|
|||||
Purchase of intangible assets
|
(1,369
|
)
|
|
—
|
|
|
(32
|
)
|
|
—
|
|
|
(1,401
|
)
|
|||||
Net cash used in investing activities
|
(7,830
|
)
|
|
(841
|
)
|
|
(228
|
)
|
|
—
|
|
|
(8,899
|
)
|
|||||
Cash flows provided by (used in) financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Principal payments of the Facility Agreement
|
(38,933
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(38,933
|
)
|
|||||
Proceeds from issuance of common stock and exercise of options and warrants
|
319
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
319
|
|
|||||
Net cash used in financing activities
|
(38,614
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(38,614
|
)
|
|||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
—
|
|
|
—
|
|
|
(73
|
)
|
|
—
|
|
|
(73
|
)
|
|||||
Net decrease in cash, cash equivalents and restricted cash
|
(35,852
|
)
|
|
(3,386
|
)
|
|
(543
|
)
|
|
—
|
|
|
(39,781
|
)
|
|||||
Cash, cash equivalents and restricted cash, beginning of period
|
96,499
|
|
|
4,942
|
|
|
3,838
|
|
|
—
|
|
|
105,279
|
|
|||||
Cash, cash equivalents and restricted cash, end of period
|
$
|
60,647
|
|
|
$
|
1,556
|
|
|
$
|
3,295
|
|
|
$
|
—
|
|
|
$
|
65,498
|
|
|
Parent
Company
|
|
Guarantor
Subsidiaries
|
|
Non-
Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Cash flows provided by operating activities
|
$
|
4,008
|
|
|
$
|
1,068
|
|
|
$
|
1,180
|
|
|
$
|
—
|
|
|
$
|
6,256
|
|
Cash flows used in investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Second-generation network costs (including interest)
|
(6,498
|
)
|
|
—
|
|
|
(32
|
)
|
|
—
|
|
|
(6,530
|
)
|
|||||
Property and equipment additions
|
(1,637
|
)
|
|
(420
|
)
|
|
(59
|
)
|
|
—
|
|
|
(2,116
|
)
|
|||||
Purchase of intangible assets
|
(1,552
|
)
|
|
—
|
|
|
(492
|
)
|
|
—
|
|
|
(2,044
|
)
|
|||||
Net cash used in investing activities
|
(9,687
|
)
|
|
(420
|
)
|
|
(583
|
)
|
|
—
|
|
|
(10,690
|
)
|
|||||
Cash flows provided by (used in) financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Principal payments of the Facility Agreement
|
(21,695
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21,695
|
)
|
|||||
Proceeds from Thermo Common Stock Purchase Agreement
|
33,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33,000
|
|
|||||
Payment of debt restructuring fee
|
(20,795
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(20,795
|
)
|
|||||
Payment of debt amendment fee
|
(255
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(255
|
)
|
|||||
Proceeds from issuance of stock to Terrapin
|
12,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,000
|
|
|||||
Proceeds from issuance of common stock and exercise of options and warrants
|
635
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
635
|
|
|||||
Net cash provided by financing activities
|
2,890
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,890
|
|
|||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
—
|
|
|
—
|
|
|
84
|
|
|
—
|
|
|
84
|
|
|||||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
(2,789
|
)
|
|
648
|
|
|
681
|
|
|
—
|
|
|
(1,460
|
)
|
|||||
Cash, cash equivalents and restricted cash, beginning of period
|
45,242
|
|
|
1,327
|
|
|
1,644
|
|
|
—
|
|
|
48,213
|
|
|||||
Cash, cash equivalents and restricted cash, end of period
|
$
|
42,453
|
|
|
$
|
1,975
|
|
|
$
|
2,325
|
|
|
$
|
—
|
|
|
$
|
46,753
|
|
•
|
two-way voice communication and data transmissions using mobile or fixed devices, including our GSP-1700 phone, our Globalstar 9600
TM
hotspot, two generations of our Sat-Fi, and other fixed and data-only devices ("Duplex");
|
•
|
one-way or two-way communication and data transmissions using mobile devices, including our SPOT family of products, such as SPOT X
TM
, SPOT Gen3 and Trace, that transmit messages and the location of the device ("SPOT"); and
|
•
|
one-way data transmissions using a mobile or fixed device that transmits its location and other information to a central monitoring station, including our commercial Simplex products, such as our battery and solar-powered SmartOne, STX-3 and STINGR ("Simplex").
|
•
|
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.
|
|
Three Months Ended
June 30, 2018 |
|
Three Months Ended
June 30, 2017 |
|
Six Months Ended
June 30, 2018 |
|
Six Months Ended
June 30, 2017 |
||||||||||||||||||||
|
Revenue
|
|
% of Total
Revenue |
|
Revenue
|
|
% of Total
Revenue |
|
Revenue
|
|
% of Total
Revenue
|
|
Revenue
|
|
% of Total
Revenue
|
||||||||||||
Service revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Duplex
|
$
|
10,134
|
|
|
30
|
%
|
|
$
|
9,322
|
|
|
33
|
%
|
|
$
|
18,917
|
|
|
30
|
%
|
|
$
|
16,920
|
|
|
32
|
%
|
SPOT
|
13,868
|
|
|
41
|
|
|
11,193
|
|
|
40
|
|
|
26,830
|
|
|
43
|
|
|
21,590
|
|
|
41
|
|
||||
Simplex
|
3,216
|
|
|
10
|
|
|
2,526
|
|
|
9
|
|
|
6,305
|
|
|
10
|
|
|
4,942
|
|
|
9
|
|
||||
IGO
|
216
|
|
|
1
|
|
|
376
|
|
|
1
|
|
|
425
|
|
|
1
|
|
|
587
|
|
|
1
|
|
||||
Other
|
561
|
|
|
2
|
|
|
884
|
|
|
3
|
|
|
1,528
|
|
|
3
|
|
|
1,743
|
|
|
3
|
|
||||
Total
|
$
|
27,995
|
|
|
84
|
%
|
|
$
|
24,301
|
|
|
86
|
%
|
|
$
|
54,005
|
|
|
87
|
%
|
|
$
|
45,782
|
|
|
86
|
%
|
|
Three Months Ended
June 30, 2018 |
|
Three Months Ended
June 30, 2017 |
|
Six Months Ended
June 30, 2018 |
|
Six Months Ended
June 30, 2017 |
||||||||||||||||||||
|
Revenue
|
|
% of Total
Revenue |
|
Revenue
|
|
% of Total
Revenue |
|
Revenue
|
|
% of Total
Revenue
|
|
Revenue
|
|
% of Total
Revenue
|
||||||||||||
Subscriber equipment sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Duplex
|
$
|
750
|
|
|
2
|
%
|
|
$
|
612
|
|
|
2
|
%
|
|
$
|
1,181
|
|
|
2
|
%
|
|
$
|
1,511
|
|
|
3
|
%
|
SPOT
|
1,908
|
|
|
6
|
|
|
1,815
|
|
|
7
|
|
|
3,341
|
|
|
5
|
|
|
3,051
|
|
|
6
|
|
||||
Simplex
|
2,846
|
|
|
8
|
|
|
1,072
|
|
|
4
|
|
|
3,650
|
|
|
6
|
|
|
1,979
|
|
|
4
|
|
||||
IGO
|
136
|
|
|
—
|
|
|
330
|
|
|
1
|
|
|
206
|
|
|
—
|
|
|
469
|
|
|
1
|
|
||||
Other
|
91
|
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
92
|
|
|
—
|
|
|
(17
|
)
|
|
—
|
|
||||
Total
|
$
|
5,731
|
|
|
16
|
%
|
|
$
|
3,822
|
|
|
14
|
%
|
|
$
|
8,470
|
|
|
13
|
%
|
|
$
|
6,993
|
|
|
14
|
%
|
|
Three Months Ended June 30,
|
|
Six Months Ended
June 30, |
||||||||||||
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Average number of subscribers for the period:
|
|
|
|
|
|
|
|
|
|
||||||
Duplex
|
67,456
|
|
|
72,290
|
|
|
68,505
|
|
|
73,650
|
|
||||
SPOT
|
293,659
|
|
|
282,826
|
|
|
293,350
|
|
|
282,149
|
|
||||
Simplex
|
345,749
|
|
|
300,459
|
|
|
343,492
|
|
|
301,433
|
|
||||
IGO
|
25,988
|
|
|
37,162
|
|
|
30,917
|
|
|
37,596
|
|
||||
Other
|
1,112
|
|
|
1,483
|
|
|
1,172
|
|
|
1,543
|
|
||||
Total
|
733,964
|
|
|
694,220
|
|
|
737,436
|
|
|
696,371
|
|
||||
|
|
|
|
|
|
|
|
||||||||
ARPU (monthly):
|
|
|
|
|
|
|
|
|
|||||||
Duplex
|
$
|
50.08
|
|
|
$
|
42.98
|
|
|
$
|
46.02
|
|
|
$
|
38.29
|
|
SPOT
|
15.74
|
|
|
13.19
|
|
|
15.24
|
|
|
12.75
|
|
||||
Simplex
|
3.10
|
|
|
2.80
|
|
|
3.06
|
|
|
2.73
|
|
||||
IGO
|
2.77
|
|
|
3.37
|
|
|
2.29
|
|
|
2.60
|
|
|
Six Months Ended
|
||||||
|
June 30,
2018 |
|
June 30,
2017 |
||||
Net cash provided by operating activities
|
$
|
7,805
|
|
|
$
|
6,256
|
|
Net cash used in investing activities
|
(8,899
|
)
|
|
(10,690
|
)
|
||
Net cash provided by (used in) financing activities
|
(38,614
|
)
|
|
2,890
|
|
||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
(73
|
)
|
|
84
|
|
||
Net decrease in cash, cash equivalents and restricted cash
|
$
|
(39,781
|
)
|
|
$
|
(1,460
|
)
|
Exhibit
Number
|
|
Description
|
|
|
|
2.1 *
|
|
|
|
|
|
10.1 *
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
32.2
|
|
|
|
|
|
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
|
|
|
|
|
|
|
GLOBALSTAR, INC.
|
|
|
|
|
Date:
|
August 2, 2018
|
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)
|
1 Year Globalstar Chart |
1 Month Globalstar Chart |
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