MILPITAS, Calif., March 27, 2008 (PRIME NEWSWIRE) -- Globalstar, Inc. (Nasdaq:GSAT), a leading provider of mobile satellite voice and data services to businesses, governments, and individuals, today announced that Open Range Communications, Inc. has secured approval for a $267 million broadband loan from the Department of Agriculture's Rural Utilities Program.
In late 2007 Globalstar signed an agreement with Open Range permitting Open Range to deploy wireless broadband service in rural America using Globalstar's Ancillary Terrestrial Component (ATC) authority. The agreement contemplates using the Globalstar spectrum to offer dual mode mobile satellite based and terrestrial wireless WiMAX services to over 500 rural American communities that currently do not have adequate access to terrestrial-based broadband voice and data services. Customers outside of the WiMAX coverage area will be able to use Globalstar service over the satellites. The agreement is contingent on various conditions, including Globalstar's receipt of authority from the FCC to use an expanded portion of its licensed spectrum for ATC services.
"Globalstar is extremely excited because this financing approval moves Open Range a step closer to meeting the wireless broadband needs of un-served and underserved rural Americans using our ATC authorized spectrum," said Jay Monroe, Chairman and CEO of Globalstar, Inc. Mr. Monroe added, "We expect the ATC agreement with Open Range to open the door for rural consumers to make new, dependable, and low-cost choices that will help provide ultimate flexibility in their daily lives. We believe this agreement establishes a framework for how global spectrum may be used more efficiently to the benefit of Globalstar, our partners and our customers."
Open Range expects initially to deploy its infrastructure in more than 500 rural communities which cover over 6 million people. The business plan calls for coverage to be deployed in rural communities with average populations of approximately 10,000 people and for availability to begin in selected markets in 2008.
The term of the agreement is 30 years, is co-extensive with Globalstar's ATC authority and is subject to renewal options exercisable by Open Range. Using the build out schedule provided in its application for the federally authorized loan program, the fixed and variable payments to be made to Globalstar over the 30 year term indicate a present value of between 30 and 40 cents per MHz/Pop. The total amount of the payments made to Globalstar will depend on a number of factors, including the eventual geographic coverage of, and the number of customers on the Open Range system.
According to the USDA press release which announced the Open Range transaction, the USDA Rural Development's mission is to increase economic opportunity and improve the quality of life for rural residents. Rural Development has invested nearly $91 billion since 2001 for equity and technical assistance to finance and foster growth in homeownership, business development, and critical community and technology infrastructure. More than 1.7 million jobs have been created or saved through these investments.
About Globalstar, Inc.
Globalstar offers satellite voice and data services to commercial and recreational users in more than 120 countries around the world. The Company's products include mobile and fixed satellite telephones, simplex and duplex satellite data modems and flexible service packages. Many land based and maritime industries benefit from Globalstar with increased productivity from remote areas beyond cellular and landline service. Global customer segments include: oil and gas, government, mining, forestry, commercial fishing, utilities, military, transportation, heavy construction, emergency preparedness, and business continuity as well as individual recreational users. Globalstar data solutions are ideal for various asset and personal tracking, data monitoring and SCADA applications.
For more information regarding Globalstar, please visit Globalstar's web site at www.globalstar.com
About Open Range
Open Range is a broadband wireless Internet access provider building a national network providing simply easier wireless broadband to un-served and underserved rural American communities. Open Range plans to deliver voice and data services on a portable and eventually mobile basis to customers within its WiMAX footprint. Within the next five years, Open Range intends to serve over 500 communities, making its services available to approximately six million people. Open Range's wireless broadband network solution will connect customers through licensed or secured spectrum, enabling communities to improve safety, economic growth, education, and quality of life and remain competitive in the age of constant communications. For more information, please visit www.openrangecomm.com.
For further media information:
Globalstar, Inc. Dean Hirasawa (408) 933-4006 Dean.hirasawa@globalstar.com
Safe Harbor Language for Globalstar Releases
This press release contains certain statements such as, "Using the build out schedule provided in its application for the federally authorized loan program, the fixed and variable payments to be made to Globalstar over the initial term of 30 years indicate a present value of between 30 and 40 cents per MHz/Pop," that are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond Globalstar's control, including demand for the Company's products and services; problems relating to the construction, launch or in-orbit performance of its existing and future satellites, problems relating to the ground-based facilities operated by it or by independent gateway operators; its ability to attract sufficient additional funding if needed to meet its future capital requirements; competition and its competitiveness vis-a-vis other providers of satellite and ground-based communications products and services; the pace and effects of industry consolidation; the continued availability of launch insurance on commercially reasonable terms, and the effects of any insurance exclusions; changes in technology; its ability to continue to attract and retain qualified personnel; worldwide economic, geopolitical and business conditions and risks associated with doing business on a global basis; and legal, regulatory, and tax developments, including changes in domestic and international government regulation.
Any forward-looking statements made in this press release speak as of the date made and are not guarantees of future performance. Actual results or developments may differ materially from the expectations expressed or implied in the forward-looking statements, and the Company undertakes no obligation to update any such statements. Additional information on factors that could influence Globalstar's financial results is included in its filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.