EXHIBIT 10.12

 

CONFIDENTIAL TREATMENT

 

Portions of this exhibit have been omitted pursuant to a request for
confidential treatment filed with the Securities and Exchange Commission
pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.  Such Portions
are marked “[*]” in this document; they have been filed separately with the
Commission.

 

AMENDMENT N°5 TO CONTRACT N° GINC-C-06-0300

BY AND BETWEEN

GLOBALSTAR, INC. AND THALES ALENIA SPACE FRANCE

 

This Amendment N°5 to the Contract dated 8th December, 2008 (the “Amendment
Effective Date”) referenced GINC-C-06-0300 is made between Thales Alenia Space
France, a Company organised and existing under the laws of France, having its
registered office at 26 avenue Jean Francois Champollion 31100 Toulouse — FRANCE
(“Contractor”) and Globalstar, Inc., a Delaware corporation with offices at 461
South Milpitas Blvd., Milpitas, California 95035, U.S.A. (“Purchaser”).

 

The Purchaser and the Contractor being hereinafter individually referred to as a
“Party” or collectively as the “Parties”.

 

RECITALS

 

Whereas, by this Amendment, the Parties agree to minor modifications to certain
provisions of the Contract and its Exhibits and Appendices relating to
(i) payments, and the Escrow Agreement and associated conditions and (ii) the
Spacecraft Delivery Schedule as further described herein.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein
contained, and intending to be legally bound hereby, the Parties hereby modify
the Contract as set forth herein:

 

A.  Escrow Account Deposit, December Payment and January Payment

 

The Parties have made certain modifications with respect to a reduction in the.
Escrow Account Deposit Requirement pursuant to Amendment N°4 to the Contract,
and Amendment N°1 to the Escrow Agreement and associated Memorandum of
Understanding.

 

The Parties further acknowledge that on. November 18, 2008, Contractor drew from
the Escrow Account an amount of Nineteen Million Five Hundred Forty-two Thousand
Four Hundred ten Euros (€19,542,410) (the “Escrow Draw Amount”) pursuant to
Article 22.B of the Contract as payment for certain invoices.  As a result of
such drawing, the Purchaser has an obligation to replenish the Escrow Draw
Amount in the Escrow Account in order that. the Escrow Account Deposit
Requirement equal Fifty Million Euros (€50,000,000), failing which Contractor is
entitled to stop the Work by December 8th, 2008 as previously notified to
Purchaser by Contractor.

 

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The Parties have agreed that Contractor’s right to stop the Work as set forth
above shall follow the following steps:.

 

Step A: starting from the date of this Amendment, as a consequence of the above,
(i) Contractor shall adjust its internal program activities to comply with the
Parties agreement herein, (ii) Purchaser will grant to Contractor an additional
fourteen (14) day grace period with respect to a delay in the successful
completion of PSR for the last Spacecraft of each Batch for purposes of
assessing Liquidated Damages for Late Delivery as set forth in Article 18.1 (C).

 

Step B: starting from December 19th, 2008 start of business in France, and until
full replenishment of the Escrow Draw Amount, Contractor reserves the right,
upon the sending of a notice to Purchaser, to stop all or part of the Work.  The
non implementation of Step B will be subject to the timely payment of the
amounts described in paragraphs (i) to (v) below:

 

(i)                                   the Purchaser shall pay to .the
.:Contractor, an amount of Five Million Euros (£5,000,000) (corresponding to a
portion of the payment milestone N° 8b invoiced by Contractor on December 3rd,
2008 the (“December Payment”), as evidenced by providing a copy of the
Purchaser’s bank switch of transfer of such funds to Contractor’s bank account
on December 19th, 2008 close of business Pacific Standard Time, failing which
the Contractor shall upon written notice of one (1) business day be entitled to
immediately stop the Work under Step B; and

 

(ii)                                the Purchaser shall pay the balance of the
December Payment to the Contractor in an amount of Six Million Forty Thousand,
Euros (€6,040,000) on or before January 5th, 2009, failing which the Contractor
shall upon written notice of one (1) business day be entitled to immediately
stop the Work under Step B; and

 

(iii)                             the Purchaser shall deposit :into the Escrow
Account a portion of the Escrow Draw Amount for an amount of Five Million Euros
(€5,000,000) on or before January 15th, 2009, failing which the Contractor shall
upon written notice of one (1) business day be entitled to immediately stop the
Work under Step B; and

 

(iv)                             the Purchaser shall, deposit into the Escrow
Account the remaining portion of the Escrow Draw Amount in order for the Escrow
Account to reach the Deposit Requirement of Fifty Million Euros (€50,000,000) on
or before January 27th, 2009, failing which the Contractor shall upon written
notice of one (1) business day be entitled to immediately stop the Work under
Step B; and

 

(v)                                the Purchaser shall pay to the Contractor an
amount of Fifteen Million Forty Thousand Euros (€15,040,000) (corresponding to
nominal payment milestone N° 9a the (“January Payment”) on or before
February 5th, 2009, failing which the Contractor shall upon written notice in
accordance with Article 22 (B), be entitled to immediately stop the Work.

 

2

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Upon Purchaser’s full replenishment of the Escrow Draw Amount in (iv) above, the
Parties confirm that all activities shall revert to the Parties rights as per
the nominal contractual provisions of the Contract.

 

The Parties confirm that in any stop Work event resulting from Step B paragraphs
i, ii, iii, iv or v above, then the following shall apply:

 

If Purchaser fails to cure the breach within thirty (30) Days from the date
Contractor has stopped the Work as defined above, Contractor shall be entitled
to immediately terminate the Contract by written notice sent to Purchaser and
the provisions of Article 22(B)(iv) shall apply.

 

If Purchaser cures the breach on or before thirty (30) Days from the date
Contractor has stopped the Work as defined above, Contractor shall resume any
Work suspended as reasonably and promptly as possible provided that
(a) Purchaser has paid to Contractor all costs and expenses incurred as a result
of the stop Work hereunder and (b) the schedule of the Contract shall be
adjusted (provided such schedule adjustment shall not be less than one Day for
each Day of Work stoppage).

 

B. Spacecraft Delivery Schedule —

 

The Parties acknowledge that Contractor is currently proceeding with certain
activities to optimize Spacecraft deliveries to Purchaser in accordance with an
Early Delivery plan as authorized under Early Delivery ED2 Scope of Work Ref
2003 318 62 W Issue 01.  The Parties note that such Early Delivery plan
objective dates for Spacecraft Pre-Shipment Review (PSR) are earlier than the
baseline schedule commitment dates as set forth in Article 18 in the Contract.
 In addition, Purchaser has recently confirmed the current planning for the
Provisional Launch Periods as communicated to Purchaser’s selected Launch
Services Provider and to Contractor pursuant to a Purchaser’s letter reference
PJR1008-004, dated 22 October 2008.

 

1.         To allow closer alignment of the Early Delivery ED2 objective dates
to the planning of the Provisional Launch Periods, Purchaser hereby agrees to
grant to Contractor a fourteen (14) Days schedule delay in the PSR ED2 Objective
Dates and Launch ED2 Objective Dates for Spacecraft Batches 2, 3, and 4 as set
forth below:

 

Accordingly, Article 26 (A) and (B) Tables for PSR ED2 Early Delivery Incentives
are replaced by the following tables:

 

(A)  Table PSR ED2 Early Delivery Incentives

 

 

 

Required
Delivery Dates
for Regular
Schedule as per
Article 18 (B)

 

PSR ED2
Objective
Dates

 

PSR
Schedule
Savings Days
for 100%
Incentives

 

Max
Incentives
amount (in
Euro)

Batch 1 FM 2 to FM7*

 

Oct 13, 2009

 

Sept 03, 2009

 

40

 

[*]

Batch 2 FM 8 to FM13*

 

Dec 04, 2009

 

Oct 27, 2009

 

38

 

[*]

Batch 3 FM 14 to FM19*

 

Jan 15, 2010

 

Dec 8, 2009

 

38

 

[*]

Batch 4 FM 20 to FM 25*

 

Feb 26, 2010

 

Jan 29, 2010

 

28

 

[*]

 

3

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(*)For the avoidance of doubt a Batch shall be comprised of 6 Spacecraft
independently of FM numbers specified in the above table.

 

(B)  Table Launch ED2 Early Delivery Incentives

 

 

 

Nominal
Scheduled
Launch Dates

 

Launch ED2
Objective Dates

 

Launch
Schedule
Saving
Days for
100%
Incentives

 

Max
Incentives
amount (in
Euro)

Batch 1 FM 2 to FM7*

 

Dec 22, 2009

 

Nov 12, 2009

 

40

 

[*]

Batch 2 FM 8 to FM13*

 

Feb 04, 2010

 

Dec 28, 2009

 

38

 

[*]

Batch 3 FM 14 to FM19*

 

March 15, 2010

 

Feb 12, 2010

 

31

 

[*]

Batch 4 FM 20 to FM 25*

 

April 26, 2010

 

March 31, 2010

 

28

 

[*]

 

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(*)For the avoidance of doubt a Batch shall be comprised of 6 Spacecraft
independently of FM numbers specified in’ the above table.

 

All of the terms, covenants and conditions of the Contract as may already have
been amended shall remain in full force and effect except to the extent the same
have been expressly amended or modified by the terms of this Amendment N°5.

 

All capitalized terms not otherwise defined in this Amendment N°5 shall have the
meanings for such terms as set forth in the Contract.

 

EXECUTION

 

In witness whereof, the Parties have duly executed this Contract Amendment.

 

Globalstar, Inc.

 

Thales Alenia Space France

 

 

 

 

 

 

By:

/s/ Paul Rosati

 

By:

Blaise Jaeger

Name:  Paul Rosati

 

Name: Blaise Jaeger

Title: Contracts Manager

 

Title: EVP Telecom

Date:  December 9, 2008

 

Date:  December 9, 2008

 

4

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