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4510 E. Thousand Oaks Blvd

Westlake Village, CA 91362

Exhibit 10.2

 

 

December 28, 2012

 

Globalstar, Inc.

300 Holiday Square Boulevard

Covington, Louisiana 70433

 

Re:  Engagement of Financial West Group   as Placement  Agent for Globalstar,
Inc.

 

Gentlemen:

 

This letter (this "Engagement Letter") will confirm our agreement with
Globalstar, Inc. (the “Company”) with respect to the engagement of Financial
West Group, member FINRA/SIPC (“FWG”) as the Company's placement agent, solely
in connection with the placement of the Company's voting common stock (the
"Common Stock" or "Common Shares") to Terrapin Opportunity, L.P. (collectively
with its affiliated funds, the "Investor"), as more fully described herein. FWG
hereby agrees, on a best efforts basis and subject to the satisfactory
completion of our continuing due diligence, to place up to Thirty Million
Dollars ($30,000,000) of the Company's authorized but unissued Common Stock with
the Investor, as more particularly set forth below and subject to the terms and
conditions of this Engagement Letter.

 

The Common Stock will be offered and sold on such terms as the Company and the
Investor may agree upon in that certain “Common Stock Purchase Agreement,” dated
as of December 28, 2012, by and between the Company and the Investor, a copy of
which is attached hereto as Exhibit A and incorporated herein by this reference
(the “Purchase Agreement”), and the offering and sale of such Common Stock shall
be made in reliance upon the provisions of Section 4(a)(2) of the Securities Act
of 1933 (the “Securities Act”) and Regulation D promulgated pursuant to the
Securities Act, as amended (“Regulation D”). FWG will use no offering materials
other than the Company's publicly filed reports and such other materials,
including the Purchase Agreement and a registration rights agreement, as the
Company will have approved prior to their use. The parties hereto agree that the
Common Shares will be offered and sold by the Company in compliance with all
applicable federal and state securities laws and regulations, including but not
limited to Regulation D. The Investor shall certify to the Company in writing in
the Purchase Agreement that it is an “accredited investor” as that term is
defined by Rule 501(c) of Regulation D. The placement of the Common Stock by FWG
to the Investor as contemplated hereby may be referred to herein as the
"Offering.”

 

30 Sunnyside Avenue | Mill Valley | CA 94941 | (415) 383-4700 | Fax (415)
383-4799

 

 

Globalstar, Inc. Page 2

 

The term of FWG's engagement (the "Engagement Period") as placement agent for
the offer and sale of the Common Stock to the Investor will commence on the date
of actual receipt by FWG of an executed copy of this Engagement Letter from the
Company and, unless extended pursuant to the further written agreement of the
parties, will expire upon the earliest of (i) January 1, 2015, (ii) the date
that all the shares of Common Stock under the Purchase Agreement have been
issued and sold, (iii) the date that the Investor has purchased an aggregate of
$30,000,000 of shares of Common Stock, or that number of shares which is one
share less than twenty percent (20.0%) of the total issued and outstanding
shares of Common Stock as of the effective date of the Purchase Agreement,
whichever occurs first, pursuant to the Purchase Agreement, (iv) the date that
the Offering is terminated by the Company or the Investor or (v) at the
Company’s election, the date that FWG breaches any representation or covenant in
this Engagement Letter. To the extent the Company so requests, FWG will assist
with each settlement of the purchase of the Common Stock pursuant to the
Offering (each, a “Closing”). There may be multiple Closings of the Offering
during the Engagement Period.

 

Upon the date of each Closing of the purchase of the Common Shares, the Company
hereby agrees to pay FWG a placement fee equal to One Thousand Five Hundred
Dollars ($1,500). Such placement fee shall be payable to FWG at the direction of
the Company via wire transfer in accordance with the wiring instructions annexed
hereto as Exhibit C. Additionally, within ten (10) days of FWG’s request, the
Company shall either (i) reimburse FWG for its reasonable, documented,
out-of-pocket legal expenses incurred in connection with the Offering, or (ii)
pay such legal invoice directly to FWG’s counsel, provided that FWG has not
previously paid such invoice itself, in each case up to a maximum of Two
Thousand Dollars ($2,000) in the aggregate.

 

This Engagement Letter is for the confidential use of the Company and FWG only,
and may not be disclosed by the Company or by FWG (in whole or in part) for any
reason to any person other than their respective Board of Directors, executive
management or its attorneys, accountants or financial advisors, and then only on
a confidential basis in connection with the proposed Offering, except where
disclosure is required by applicable law, stock exchange rule or regulation, or
is previously agreed to in writing to by the Company and FWG. The parties hereto
acknowledge and agree that, notwithstanding the preceding sentence, (i) the
arrangement contemplated hereby will be disclosed by the Company in its SEC
filings and this Engagement Letter may be filed with the SEC and (ii) the
arrangement contemplated hereby may also be disclosed by the Company in its
reports filed pursuant to the Securities Exchange Act of 1934, as amended.

 

The terms of this Engagement Letter will be governed by and interpreted in
accordance with the laws of the State of California, and any disputes arising
hereunder shall be exclusively and finally settled by an arbitration
administered by the American Arbitration Association in accordance with its
Commercial Arbitration Rules in San Francisco, California. The arbitration shall
be conducted by a single arbitrator mutually agreed upon by the parties. The
determination, finding, judgment, and/or award made by the arbitrator shall be
made in writing, shall state the basis for such determination, shall be signed
by the arbitrator and shall be final and binding on all parties, and there shall
be no appeal or reexamination thereof, except for fraud, perjury, evident
partiality, or misconduct by an arbitrator prejudicing the rights of any party
and to correct manifest clerical errors. The arbitrator shall award to the
prevailing party, if any, as determined by the arbitrator, its reasonable
attorneys’ fees and costs.

 

 

Globalstar, Inc. Page 3

 

During the Engagement Period and for 60 days thereafter, the Company agrees that
any reference to FWG in any press release or other written communications issued
by the Company to the public relating to the Offering will refer to FWG as
“Financial West Group, member FINRA/SIPC.” Additionally, the Company
acknowledges that FWG may at its option and expense (and only after the first
public disclosure or announcement of the Offering by the Company) place
announcements and advertisements or otherwise publicize FWG’s role in
facilitating the Offering (which may include the reproduction of the Company’s
logo), stating that FWG acted as placement agent in connection with such
transaction; provided, however, that FWG shall first submit a copy of any such
announcement or advertisement to the Company for its approval, which approval
shall not be unreasonably withheld.

 

The Company hereby agrees that: (1) within three (3) business days of each date
that the Company provides the Investor with a “Fixed Notice Request” (as defined
in the Purchase Agreement) it will provide FWG with a copy of such Fixed Notice
Request by facsimile to (415) 383-4799 (Attn: Jason Cohen), and (2) it will
comply in all material respects with all applicable federal and state securities
laws and regulations with respect to the Offering.

 

FWG hereby agrees and represents and warrants that: (1) FWG is a broker/dealer
registered by FINRA in accordance with all applicable laws and regulations in
each jurisdiction in which FWG intends to use its best efforts to place the
Offering, and payment of the commission contemplated under this agreement will
not jeopardize the Company's compliance with Regulation D and applicable federal
and state securities laws and regulations; (2) FWG will not make any
representations to the Investor about the Company other than information
included in the Company's public filings or otherwise conveyed to FWG by the
Company in writing for use in connection with the Offering; (3) FWG will not do
any advertising or make any general solicitation on behalf of the Company in
connection with the Offering; (4) FWG will comply with all applicable federal
and state securities laws and regulations with respect to the Offering; (5) FWG
is not affiliated with the Investor or the Company; and (6) FWG agrees to keep
confidential any nonpublic material information about the Company conveyed to
FWG by the Company. In further consideration of FWG's placement of the Common
Shares, the Company and FWG agree to be fully bound by all of the
indemnification provisions set forth on Exhibit B, a copy of which is attached
hereto and is fully incorporated herein by this reference.

 

The parties acknowledge and agree that nothing contained herein shall modify or
affect the rights or obligations of the Company and the Investor under the
Purchase Agreement. This Engagement Letter and all rights and obligations
hereunder may not be assigned by either party without the prior written consent
of the other party. This Engagement Letter may be executed in counterparts, and
any signature that is delivered by facsimile or electronic transmission will be
deemed to constitute delivery of a manually executed original.

 

 

 

 

If the foregoing is acceptable, please sign and return to us a copy of this
Engagement Letter, which will represent the entire agreement between the Company
and FWG with respect to the matters addressed herein and will supersede all
previous oral or written agreements or understandings of any nature whatsoever
between the parties. We look forward to working with you.

 

Sincerely,

 

Financial West Group   Globalstar, Inc.           By: /s/ Howard Davis   By /s/
James Monroe III   Howard Davis     Name: James Monroe III   Director of
Corporate Finance      Title: CEO

 

 

 

 

Exhibit A to Engagement Letter

 

Form of Common Stock Purchase Agreement

 

between Globalstar, Inc. and

Terrapin Opportunity Fund, L.P.

 

(copy attached)

 

Exhibit B to Engagement Letter

 

Company Indemnification Provisions

 

Globalstar, Inc. (the "Company") agrees to indemnify and hold harmless Financial
West Group, member FINRA/SIPC ("FWG"), and its directors, officers, and each
person, if any, who controls FWG within the meaning of Section 15 of the
Securities Act of 1933, as amended, or Section 20(a) of the Securities Exchange
Act of 1934, as amended (collectively, the "Indemnitees" and each individually
an "Indemnitee"), to the fullest extent permitted by applicable law, from and
against any and all claims, demands, causes of action, obligations, losses,
damages, liabilities, costs or expenses arising in law, equity or otherwise, of
any nature whatsoever, including without limitation, any and all reasonable
legal, accounting and other professional fees and related costs and
disbursements and other costs, expenses, or disbursements relating thereto
(collectively, the "Liabilities"), directly or indirectly, based upon or arising
out of, or in connection with:

 

(a)any act or omission of the Company (or any affiliate thereof) in violation of
the Engagement Letter between FWG and the Company to which this Exhibit B is an
integral part (the “Engagement Letter”) or the transactions contemplated
thereby, including, without limitation, any violation of applicable laws or
regulations by the Company (or any affiliate thereof); or

 

(b)any untrue or alleged untrue statement of a material fact contained in the
Registration Statement (as defined in the Purchase Agreement) or the omission or
alleged omission to state a material fact necessary to make the statements made
therein, in light of the circumstance under which the statements therein were
made, not misleading; or

 

(c)any untrue or alleged untrue statement of a material fact contained in the
Prospectus (as defined in the Purchase Agreement) as the same may be amended or
supplemented, or the omission or alleged omission to state a material fact
necessary to make the statements made therein, in light of the circumstance
under which the statements therein were made, not misleading; or

 

 

 

 

(d)any breach by the Company (or any affiliate thereof) of any of the terms of
the Engagement Letter between FWG and the Company, or any purchase and sale
agreement, registration rights agreement, or other agreement between the Company
and Terrapin Opportunity, L.P. (collectively with its affiliated funds, the
"Investor"), or the terms of the securities purchased or issuable pursuant
thereto.

 

The Company may, at its own expense, seek reimbursement of amounts already paid
to such Indemnitee once and to the extent the relevant Liabilities are
determined in a final judgment by court of competent jurisdiction (not subject
to further appeal) to have resulted from any Indemnitee’s gross negligence, bad
faith or willful or reckless misconduct. These indemnification provisions are in
addition to any liability that the Company may otherwise have to any Indemnitee
or the Investor.

 

The Company further agrees that no Indemnitee will have any liability for any
Liabilities (whether direct or indirect, in contract or tort or otherwise) to
the Company (or any affiliate thereof), or to any person (including, without
limitation, Company shareholders) claiming through the Company (or any affiliate
thereof) in connection with the engagement of FWG or for or in connection with
the acts or omissions of any such Indemnitee or any other Indemnitee, except to
the extent that any such Liabilities are found in final judgment by a court of
competent jurisdiction (not subject to further appeal) to have resulted from the
gross negligence, bad faith or willful or reckless misconduct (including a
breach of any of the representations, warranties, covenants or agreements of FWG
in the Engagement Letter) of the Indemnitee seeking indemnification.

 

In order to provide for just and equitable contribution, if a claim for
indemnification pursuant to these indemnification provisions is made but it is
found in final judgment by a court of competent jurisdiction (not subject to
further appeal) that such indemnification may not be enforced in such case, then
the Company, on the one hand, and the claiming Indemnitees on the other hand,
will contribute to the losses, claims, damages, obligations, penalties,
judgments, awards, liabilities, costs, expenses and disbursements (collectively,
the “Losses”) to which such Indemnitees may be subject. Said contribution will
be made in accordance with all relative benefits received by, and the fault of,
the Company on the one hand, and such Indemnitees on the other hand, in
connection with the statements, acts or omissions which resulted in such Losses,
together with the relevant equitable considerations and will be determined
pursuant to the arbitration provisions set forth in the Engagement Letter. No
person found liable for fraudulent misrepresentation will be entitled to
contribution from any person who is not also found liable for such fraudulent
misrepresentation.

 

If any action, suit, proceeding, or investigation commenced which gives rise to
a claim for indemnification and which, in any Indemnitee's reasonable judgment
upon written advice of counsel, gives rise to a conflict of interest between the
Company and the Indemnitees, then the Indemnitees will have the right to retain
legal counsel of their own choice to represent and advise them, and the Company
will pay the reasonable fees, expenses and disbursements of no more than one (1)
law firm for all Indemnitees incurred from time to time in the manner set forth
above. Such law firm will, to the extent consistent with their professional
responsibilities, cooperate with the Company and any counsel designated by the
Company. Notwithstanding anything herein to the contrary, the Company will not
be liable for any settlement of any claim, action suit or proceeding effected
without its prior written consent. Neither the Company nor any affiliate thereof
will, without the prior written consent of the Indemnitee seeking
indemnification, settle or compromise any actual, potential or threatened claim
for which indemnification is sought hereunder, or permit a default or consent to
the entry of any judgment in respect thereof, unless such settlement, compromise
or consent includes, as an unconditional term thereof, the giving by the
claimant to the Indemnitees of an unconditional release from all liability in
respect of such claim.

 

 

 

 

Neither termination nor completion of the engagement of FWG pursuant to the
Engagement Letter will affect these indemnification provisions, which will
survive any such termination or completion and remain operative and in full
force and effect. If any term, provision, covenant or restriction contained in
the Engagement Letter or this Exhibit B is held by a court of competent
jurisdiction or other authority to be invalid, void, unenforceable or against
its regulatory policy, the remainder of the terms, provisions, covenants and
restrictions contained herein shall remain in full force and effect and shall in
no way be affected, impaired or invalidated.

 

Exhibit C to Engagement Letter

 

FWG Wiring Instructions

 

(Financial West Group)

 

Chase Manhattan Bank N.Y.

ABA# 021-000-021

F/A/O – NFS

A/C #

F/B/O – NFS A/C