##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2011
 OR
 o
    
    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: 000-22839
 Globecomm Systems Inc.
  Delaware
(State or other jurisdiction of 
incorporation or organization)
    
    11-3225567
(I.R.S. Employer
Identification No.)
 45 Oser Avenue, 
Hauppauge, NY
(Address of principal executive offices)
    
    11788
(Zip Code)
 Registrants telephone number, including area code: (631) 231-9800
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ




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##### 



GLOBECOMM SYSTEMS INC.
   
 PagePart I  Financial InformationItem 1. Financial Statements
    
    
    3Consolidated Balance Sheets  As of March 31, 2011 (unaudited) and June 30, 2010
    
    
    3Consolidated Statements of Operations (unaudited)  For the three and nine months ended
March 31, 2011 and 2010
    
    
    4Consolidated Statement of Changes in Stockholders Equity (unaudited)  For the nine
months ended March 31, 2011
    
    
    5Consolidated Statements of Cash Flows (unaudited)  For the nine months ended
March 31, 2011 and 2010
    
    
    6Notes to Consolidated Financial Statements (unaudited)
    
    
    7Item 2. Managements Discussion and Analysis of Financial Condition and Results
of Operations
    
    
    16Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    24Item 4. Controls and Procedures
    
    
    25Part II  Other InformationItem 1. Legal Proceedings
    
    
    25Item 1A. Risk Factors
    
    
    25Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    34Item 3. Defaults Upon Senior Securities
    
    
    34Item 4. Removed and Reserved
    
    
    34Item 5. Other Information
    
    
    34Item 6. Exhibits
    
    
    34Signatures
    
    
    35EX-31.1EX-31.2EX-32
  2




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##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Item 1.
    
    Financial Statements
 GLOBECOMM
SYSTEMS INC.
 
 CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
 March 31,
    
    
    June 30,2011
    
    
    2010(Unaudited)AssetsCurrent assets:Cash and cash equivalents
    
    $
    39,521
    
    
    $
    42,863Restricted cash
    
    
    5,028
    
    
    
    5,025Accounts receivable, net
    
    
    55,515
    
    
    
    49,222Inventories
    
    
    47,445
    
    
    
    34,486Prepaid expenses and other current assets
    
    
    5,372
    
    
    
    3,100Deferred income taxes
    
    
    1,603
    
    
    
    1,602Total current assets
    
    
    154,484
    
    
    
    136,298Fixed assets, net
    
    
    39,447
    
    
    
    37,839Goodwill
    
    
    40,594
    
    
    
    40,594Intangibles, net
    
    
    14,542
    
    
    
    16,196Deferred income taxes
    
    
    3,679
    
    
    
    7,635Other assets
    
    
    2,232
    
    
    
    2,148Total assets
    
    $
    254,978
    
    
    $
    240,710Liabilities and Stockholders EquityCurrent liabilities:Accounts payable
    
    $
    31,035
    
    
    $
    36,929Deferred revenues
    
    
    9,400
    
    
    
    2,290Accrued payroll and related fringe benefits
    
    
    5,869
    
    
    
    6,390Other accrued expenses
    
    
    15,892
    
    
    
    11,477Current portion of long-term debt
    
    
    2,500
    
    
    
    2,500Total current liabilities
    
    
    64,696
    
    
    
    59,586Other liabilities
    
    
    801
    
    
    
    2,443Long term debt
    
    
    7,500
    
    
    
    9,375Deferred income taxes
    
    
    2,203
    
    
    
    2,203Commitments and contingenciesStockholders equity:Series A Junior Participating, shares
authorized, issued and outstanding: none at
March 31, 2011 and June 30, 2010
    
    
    
    
    
    
    Common stock, $.001 par value, 50,000,000
shares authorized, shares issued: 22,829,416
at March 31, 2011 and 22,050,635 at June 30,
2010
    
    
    23
    
    
    
    22Additional paid-in capital
    
    
    194,969
    
    
    
    189,401Accumulated deficit
    
    
    (12,516
    )
    
    
    (19,346
    )Treasury stock, at cost, 465,351 shares at
March 31, 2011 and June 30, 2010
    
    
    (2,781
    )
    
    
    (2,781
    )Accumulated other comprehensive income (loss)
    
    
    83
    
    
    
    (193
    )Total stockholders equity
    
    
    179,778
    
    
    
    167,103Total liabilities and stockholders equity
    
    $
    254,978
    
    
    $
    240,710
  3




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##### Table of Contents



GLOBECOMM
SYSTEMS INC.
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
 (Unaudited)
 Three Months Ended
    
    
    Nine Months EndedMarch 31,
    
    
    March 31,
    
    
    March 31,
    
    
    March 31,2011
    
    
    2010
    
    
    2011
    
    
    2010Revenues from services
    
    $
    45,963
    
    
    $
    34,018
    
    
    $
    136,159
    
    
    $
    96,196Revenues from infrastructure solutions
    
    
    16,520
    
    
    
    18,782
    
    
    
    49,771
    
    
    
    61,362Total revenues
    
    
    62,483
    
    
    
    52,800
    
    
    
    185,930
    
    
    
    157,558Costs and operating expenses:Costs from services
    
    
    31,691
    
    
    
    24,822
    
    
    
    95,768
    
    
    
    70,907Costs from infrastructure solutions
    
    
    12,866
    
    
    
    14,853
    
    
    
    40,073
    
    
    
    50,486Selling and marketing
    
    
    4,251
    
    
    
    3,943
    
    
    
    12,928
    
    
    
    10,817Research and development
    
    
    723
    
    
    
    760
    
    
    
    2,732
    
    
    
    2,272General and administrative
    
    
    7,547
    
    
    
    6,478
    
    
    
    20,533
    
    
    
    17,209Earn-out fair value adjustments
    
    
    400
    
    
    
    23
    
    
    
    2,549
    
    
    
    23Total costs and operating expenses
    
    
    57,478
    
    
    
    50,879
    
    
    
    174,583
    
    
    
    151,714Income from operations
    
    
    5,005
    
    
    
    1,921
    
    
    
    11,347
    
    
    
    5,844Interest income
    
    
    44
    
    
    
    58
    
    
    
    144
    
    
    
    326Interest expense
    
    
    (69
    )
    
    
    (27
    )
    
    
    (218
    )
    
    
    (27
    )Income before income taxes
    
    
    4,980
    
    
    
    1,952
    
    
    
    11,273
    
    
    
    6,143Provision for income taxes
    
    
    1,992
    
    
    
    707
    
    
    
    4,443
    
    
    
    2,256Net income
    
    $
    2,988
    
    
    $
    1,245
    
    
    $
    6,830
    
    
    $
    3,887Basic net income per common share
    
    $
    0.14
    
    
    $
    0.06
    
    
    $
    0.32
    
    
    $
    0.19Diluted net income per common share
    
    $
    0.14
    
    
    $
    0.06
    
    
    $
    0.31
    
    
    $
    0.19Weighted-average shares used in the
calculation of basic net income
per common share
    
    
    21,442
    
    
    
    20,601
    
    
    
    21,230
    
    
    
    20,466Weighted-average shares used in the
calculation of diluted net income
per common share
    
    
    22,104
    
    
    
    21,030
    
    
    
    21,830
    
    
    
    20,884
  4




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##### Table of Contents



GLOBECOMM
SYSTEMS INC.
 
 CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS EQUITY
FOR THE NINE MONTHS ENDED MARCH 31, 2011
 (In thousands)
(Unaudited)
 AccumulatedAdditional
    
    
    
    
    
    
    Other
    
    
    
    
    
    
    
    
    
    
    TotalCommon Stock
    
    
    Paid-in
    
    
    Accumulated
    
    
    Comprehensive
    
    
    Treasury Stock
    
    
    StockholdersShares
    
    
    Amount
    
    
    Capital
    
    
    Deficit
    
    
    Income (Loss)
    
    
    Shares
    
    
    Amount
    
    
    EquityBalance at June 30, 2010
    
    
    22,051
    
    
    $
    22
    
    
    $
    189,401
    
    
    $
    (19,346
    )
    
    $
    (193
    )
    
    
    465
    
    
    $
    (2,781
    )
    
    $
    167,103Proceeds from exercise of stock options
    
    
    237
    
    
    
    
    
    
    
    1,475
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,475Stock compensation expense
    
    
    
    
    
    
    
    
    
    
    2,513
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,513Grant of restricted shares
    
    
    428Tax benefit from stock compensation
plan
    
    
    
    
    
    
    
    
    
    
    9
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9Grant of shares for Telaurus earn-out
    
    
    113
    
    
    
    1
    
    
    
    895
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    896Grant of warrants for Telaurus earn-out
    
    
    
    
    
    
    
    
    
    
    676
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    676Comprehensive income:Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,830
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,830Gain from foreign currency translation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    276
    
    
    
    
    
    
    
    
    
    
    
    276Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,106Balance at March 31, 2011
    
    
    22,829
    
    
    $
    23
    
    
    $
    194,969
    
    
    $
    (12,516
    )
    
    $
    83
    
    
    
    465
    
    
    $
    (2,781
    )
    
    $
    179,778
  5




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##### Table of Contents



GLOBECOMM
SYSTEMS INC.
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
 (Unaudited)
 Nine Months EndedMarch 31,
    
    
    March 31,2011
    
    
    2010Operating Activities:Net income
    
    $
    6,830
    
    
    $
    3,887Adjustments to reconcile net income to net cash provided by
operating activities:Depreciation and amortization
    
    
    6,832
    
    
    
    5,391Provision for doubtful accounts
    
    
    496
    
    
    
    679Deferred income taxes
    
    
    3,956
    
    
    
    2,086Stock compensation expense
    
    
    2,513
    
    
    
    1,704Tax benefit from stock compensation plan
    
    
    9
    
    
    
    2Earn-out fair value adjustments
    
    
    2,549
    
    
    
    23Changes in operating assets and liabilities:Accounts receivable
    
    
    (6,354
    )
    
    
    1,969Inventories
    
    
    (12,867
    )
    
    
    (16,191
    )Prepaid expenses and other current assets
    
    
    (2,077
    )
    
    
    362Other assets
    
    
    (12
    )
    
    
    (156
    )Accounts payable
    
    
    (6,394
    )
    
    
    3,410Deferred revenue
    
    
    7,110
    
    
    
    1,361Accrued payroll and related fringe benefits
    
    
    (558
    )
    
    
    298Other accrued expenses
    
    
    1,980
    
    
    
    1,292Other liabilities
    
    
    17
    
    
    
    (131
    )Net cash provided by operating activities
    
    
    4,030
    
    
    
    5,986Investing Activities:Purchases of fixed assets
    
    
    (6,619
    )
    
    
    (6,823
    )Acquisition of business, net of cash received
    
    
    
    
    
    
    (13,901
    )Cash payment for Telaurus earn out
    
    
    (586
    )
    
    
    (353
    )Restricted cash
    
    
    
    
    
    
    (5,000
    )Net cash used in investing activities
    
    
    (7,205
    )
    
    
    (26,077
    )Financing Activities:Proceeds from exercise of stock options
    
    
    1,475
    
    
    
    181Borrowings under C2C acquisition loan
    
    
    
    
    
    
    12,500Proceeds from sale of common stock
    
    
    
    
    
    
    497Repayments of debt
    
    
    (1,875
    )
    
    
    Net cash (used in) provided by financing activities
    
    
    (400
    )
    
    
    13,178Effect of foreign currency translation on cash and cash equivalents
    
    
    233
    
    
    
    (45
    )Net decrease in cash and cash equivalents
    
    
    (3,342
    )
    
    
    (6,958
    )Cash and cash equivalents at beginning of period
    
    
    42,863
    
    
    
    44,034Cash and cash equivalents at end of period
    
    $
    39,521
    
    
    $
    37,076Supplemental Disclosure of Cash Flow Information:Cash paid for interest
    
    $
    221
    
    
    $
    Cash paid for income taxes
    
    
    693
    
    
    
    342
  6




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##### Table of Contents



GLOBECOMM
SYSTEMS INC.
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2011
(Unaudited)
 1. Basis of Presentation
   Principles of Consolidation
  Accounting Estimates
  Revenue Recognition
  7




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Costs from Services
  Costs from Infrastructure Solutions
  Research and Development
    Goodwill and Other Intangible Assets
  8




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Comprehensive Income
  Income Taxes
      Product Warranties
  9




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##### Table of Contents



Foreign Exchange Contracts
  Restricted Cash
  Recent Accounting Pronouncements
    2. Basic and Diluted Net Income Per Common Share
  10




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3. Inventories
  March 31,2011
    
    
    June 30,(Unaudited)
    
    
    2010(In thousands)Raw materials and component parts
    
    $
    1,212
    
    
    $
    1,392Work-in-progress
    
    
    47,520
    
    
    
    34,36848,732
    
    
    
    35,760Less progress payments
    
    
    1,287
    
    
    
    1,274$
    47,445
    
    
    $
    34,486
 4. Segment Information
   11




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##### Table of Contents



Three Months Ended
    
    
    Nine Months EndedMarch 31,
    
    
    March 31,
    
    
    March 31,
    
    
    March 31,2011
    
    
    2010
    
    
    2011
    
    
    2010(Unaudited)(In thousands)Revenues:Services
    
    $
    50,233
    
    
    $
    35,834
    
    
    $
    145,682
    
    
    $
    102,831Infrastructure solutions
    
    
    16,520
    
    
    
    18,849
    
    
    
    49,929
    
    
    
    62,193Intercompany eliminations
    
    
    (4,270
    )
    
    
    (1,883
    )
    
    
    (9,681
    )
    
    
    (7,466
    )Total revenues
    
    $
    62,483
    
    
    $
    52,800
    
    
    $
    185,930
    
    
    $
    157,558Income (loss) from operations:Services
    
    $
    6,642
    
    
    $
    4,307
    
    
    $
    16,487
    
    
    $
    11,225Infrastructure solutions
    
    
    (1,603
    )
    
    
    (2,388
    )
    
    
    (5,093
    )
    
    
    (5,327
    )Interest income
    
    
    44
    
    
    
    58
    
    
    
    144
    
    
    
    326Interest expense
    
    
    (69
    )
    
    
    (27
    )
    
    
    (218
    )
    
    
    (27
    )Intercompany eliminations
    
    
    (34
    )
    
    
    2
    
    
    
    (47
    )
    
    
    (54
    )Income before income taxes
    
    $
    4,980
    
    
    $
    1,952
    
    
    $
    11,273
    
    
    $
    6,143Depreciation and amortization:Services
    
    $
    2,066
    
    
    $
    1,535
    
    
    $
    5,529
    
    
    $
    4,006Infrastructure solutions
    
    
    445
    
    
    
    444
    
    
    
    1,320
    
    
    
    1,411Intercompany eliminations
    
    
    (6
    )
    
    
    (9
    )
    
    
    (17
    )
    
    
    (26
    )Total depreciation and amortization
    
    $
    2,505
    
    
    $
    1,970
    
    
    $
    6,832
    
    
    $
    5,391Expenditures for long-lived assets:Services
    
    $
    1,118
    
    
    $
    747
    
    
    $
    6,191
    
    
    $
    6,088Infrastructure solutions
    
    
    169
    
    
    
    193
    
    
    
    428
    
    
    
    735Total expenditures for long-lived assets
    
    $
    1,287
    
    
    $
    940
    
    
    $
    6,619
    
    
    $
    6,823
 March 31,2011
    
    
    June 30,(Unaudited)
    
    
    2010(In thousands)Assets:Services
    
    $
    146,962
    
    
    $
    130,866Infrastructure solutions
    
    
    225,458
    
    
    
    207,053Intercompany eliminations
    
    
    (117,442
    )
    
    
    (97,209
    )Total assets
    
    $
    254,978
    
    
    $
    240,710
 5. Long-Term Debt
 Line of Credit
  12




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C2C
  2011
    
    $
    6252012
    
    
    2,5002013
    
    
    2,5002014
    
    
    2,5002015
    
    
    1,875
 ComSource Acquisition Loan
  6. Acquisitions
    13




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Three months ended
    
    
    Nine months endedMarch 31, 2010
    
    
    March 31, 2010(in thousands, except per share data)Revenues
    
    $
    56,527
    
    
    $
    171,970Net income
    
    $
    1,312
    
    
    $
    4,568Basic net income per common share
    
    $
    0.06
    
    
    $
    0.22Diluted net income per common share
    
    $
    0.06
    
    
    $
    0.22
   7. Goodwill and Intangibles
  March 31,
    
    
    June 30,2011
    
    
    2010
    
    
    Est. useful life(In thousands)Customer relationships
    
    $
    16,279
    
    
    $
    16,279
    
    
    8-18 yearsSoftware
    
    
    1,287
    
    
    
    1,287
    
    
    5  yearsContracts backlog
    
    
    1,771
    
    
    
    1,771
    
    
    6 months-2 yearsCovenant not to compete
    
    
    125
    
    
    
    125
    
    
    3-4 yearsTrademark
    
    
    82
    
    
    
    82
    
    
    5  years19,544
    
    
    
    19,544Less accumulated amortization
    
    
    5,002
    
    
    
    3,348Intangibles, net
    
    $
    14,542
    
    
    $
    16,196
   14




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2011
    
    $
    5062012
    
    
    1,8892013
    
    
    1,6072014
    
    
    1,5822015
    
    
    1,289
 8. Fair Value Measurements
          9. Subsequent Events
    15




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.
  Overview
        16




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Critical Accounting Policies
  Revenue Recognition  Infrastructure Solutions
   17




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Costs from Infrastructure Solutions
  Goodwill and Other Intangible Assets Impairment
  Deferred tax assets
    18




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Stock-Based Compensation
   Allowances for Doubtful Accounts
  Inventories
  Valuation of contingent consideration
  Recent Accounting Pronouncements
   19




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Results of Operations
 Three and Nine Months Ended March 31, 2011 and 2010
  Revenues from Services.
 Revenues from Infrastructure Solutions.
 Costs from Services.
 Costs from Infrastructure Solutions.
 20




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Selling and Marketing.
 Research and Development
 General and Administrative
 Earn-out Fair Value Adjustments.
 Interest Income
 Interest Expense.
 Provision for Income Taxes
 21




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Liquidity and Capital Resources
        22




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Payments Due by PeriodContractual
Obligations
    
    Total
    
    
    Less than 1 year
    
    
    1-3 years
    
    
    4-5 years
    
    
    More than 5 yearsOperating leases
    
    $
    56,521
    
    
    $
    35,309
    
    
    $
    16,173
    
    
    $
    4,870
    
    
    $
    169Long-term debt
    
    
    10,000
    
    
    
    2,500
    
    
    
    5,000
    
    
    
    2,500
    
    
    
    Total
contractual obligations
    
    $
    66,521
    
    
    $
    37,809
    
    
    $
    21,173
    
    
    $
    7,370
    
    
    $
    169
 23




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Amount of Commitment Expiration Per PeriodOther
Commercial Commitments
    
    Total Amounts Committed
    
    
    Less than 1 year
    
    
    1-3 years
    
    
    4-5 years
    
    
    More Than 5 yearsStandby letters of credit
    
    $
    6,859
    
    
    $
    3,676
    
    
    $
    3,183
    
    
    $
    
    
    
    $
    Total commercial commitments
    
    $
    6,859
    
    
    $
    3,676
    
    
    $
    3,183
    
    
    $
    
    
    
    $
    
     Off-Balance Sheet Arrangements
  
 Item 3. Quantitative and Qualitative Disclosures About Market Risk
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Item 4. Controls and Procedures
 Evaluation of Disclosure Controls and Procedures.
 Changes in Internal Control Over Financial Reporting.
 
 Part II  Other Information
 
 Item 1. Legal Proceedings
 None
 
 Item 1A. Risk Factors
 Risks Related to Our Business
 Reductions in telecommunications equipment and systems spending have negatively affected our
revenues and profitability of our infrastructure solutions segment, which may not be offset by the
growth in our services segment.
  A limited number of customer contracts account for a significant portion of our revenues, and the
inability to replace a key customer contract or the failure of the customer to implement its plans
would adversely affect our results of operations, business and financial condition.
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We derive a substantial portion of our revenues from the government marketplace, and a downturn in
this marketplace would adversely affect us.
   We often act as a subcontractor, particularly in the government marketplace and our results could
be adversely affected by the prime contractors inability to obtain or renew its contracts with the
ultimate customer.
  Risks associated with operating in international markets, including areas of conflict, could
restrict our ability to expand globally and harm our business and prospects.
  
    
    general political and economic instability in international markets, including the
hostilities in Iraq and Afghanistan, could impede our ability to deliver our services
and products to customers;
    
    difficulties in collecting accounts receivable could affect our results of
operations;
    
    changes in regulatory requirements could restrict our ability to deliver services to
our international customers, including the addition of a country to the list of
sanctioned countries under the International Emergency Economic Powers Act or similar
legislation;
    
    export restrictions, tariffs, licenses and other trade barriers could prevent us
from adequately equipping our network facilities;
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
    
    differing technology standards across countries may impede our ability to integrate
our services and products across international borders;
    
    protectionist laws and business practices favoring local competition may give
unequal bargaining leverage to key vendors in countries where competition is scarce,
significantly increasing our operating costs;
    
    increased expenses associated with marketing services in foreign countries could
affect our ability to compete;
    
    relying on local subcontractors for installation of our services and products could
adversely impact the quality of our services and products;
    
    difficulties in staffing and managing foreign operations could affect our ability
to compete;
    
    complex foreign laws and treaties could affect our ability to compete; and
    
    potentially adverse taxes could affect our results of operations.
  Our service revenue has increased as a percentage of total revenue and if our service revenue
decreases or margins decrease, our results of operations will be harmed
  We derive a substantial portion of our revenues from fixed-price projects, under which we assume
greater financial risk if we fail to accurately estimate the costs of the projects.
  Future acquisitions and strategic investments may divert our resources and managements attention,
results may fall short of expectations and, as a result, our operating results may be difficult to
forecast and may be volatile.
  
    
    failure of the acquisition or investment to meet
the expectations upon which we made a decision to
proceed;
    
    difficulties in the integration of the operations,
technologies, products and personnel of an acquired
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business;
    
    diversion of managements attention from other business concerns;
    
    substantial transaction costs;
    
    the potential of significant goodwill and
intangibles write-offs in the future in the event that
an acquisition or investment does not meet
expectations;
    
    increased expenses associated with the consummation and integration of an acquisition; and
    
    loss of key employees, customers or suppliers of any acquired business.
  In the event of a catastrophic loss affecting our operations in Hauppauge, New York, Laurel,
Maryland or the Netherlands, our results of operations would be harmed.
  Our markets are highly competitive and we have many established competitors, and we may lose market
share as a result.
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If our services and products are not accepted in developing countries with emerging markets, our
revenues will be impaired.
  
    
    the speed at which communications infrastructure, including terrestrial microwave,
coaxial cable and fiber optic communications systems, which compete with
satellite-based services, is built;
    
    the effectiveness of our local resellers and sales representatives in marketing and
selling our services and products; and
    
    the acceptance of our services and products by customers.
  Since sales of satellite communications equipment are dependent on the growth of communications
networks, if market demand for these networks does not increase from recent depressed levels, our
revenue and profitability are likely to decline.
  We depend upon certain key personnel and may not be able to retain these employees. If we lose the
services of these individuals or cannot hire additional qualified personnel, our business will be
harmed.
   Satellites upon which we rely may malfunction or be damaged or lost.
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We depend on our suppliers, some of which are our sole or a limited source of supply, and the loss
of any of these suppliers could materially adversely affect our business, results of operations and
financial condition.
  Our network may experience security breaches, which could disrupt our services.
  If the satellite communications industry fails to continue to develop or new technology makes it
obsolete, our business and financial condition will be harmed.
  We may not be able to keep pace with technological changes, which would make our services and
products become non-competitive and obsolete.
  Unauthorized use of our intellectual property by third parties may damage our business.
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Defending against intellectual property infringement claims could be time consuming and expensive,
and if we are not successful, could cause substantial expenses and disrupt our business.
  Risks Related to the Securities Markets and Ownership of Our Common Stock
 Our stock price is volatile.
  
    
    quarterly variations in operating results;
    
    announcements of new technology, products or services by us or any of our
competitors;
    
    changes in financial estimates or recommendations by securities analysts;
    
    general market conditions, including periods of significant volatility; or
    
    domestic and international economic factors unrelated to our performance.
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Because our common stock is thinly traded, it may be difficult to sell shares of our common stock
into the markets without experiencing significant price volatility.
  A
third party could be prevented from acquiring shares of our stock at a premium to the market price because of our anti-takeover provisions.
  We have not paid dividends in the past and do not expect to pay dividends in the future, and any
return on investment may be limited to the value of our stock.
  Risks Related to Government Approvals
 We are subject to many government regulations, and failure to comply with them will harm our
business.
 Operations and Use of Satellites
  Foreign Regulations
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Regulation of the Internet
  Telecommunications Taxation, Support Requirements, and Access Charges
   Export of Telecommunications Equipment
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Foreign Ownership
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 4. Removed and Reserved
 
 Item 5. Other Information
  
 Item 6. Exhibits
 Exhibit No.
 3.1
    
    Amended and Restated Certificate of Incorporation of the Registrant, filed as Exhibit 3.1 to
the Annual Report on Form 10-K dated September 28, 1998 (Reg. No. 000-22839) (the Annual
Report), and hereby incorporated by reference.3.2
    
    Amended and Restated By-Laws of the Registrant, filed as Exhibit 3.3 to the Annual Report,
and hereby incorporated by reference.31.1
    
    Chief Executive Officer Certification required by Rules 13a-14 and 15d-14 under the
Securities Exchange Act of 1934, as amended (filed herewith).31.2
    
    Chief Financial Officer Certification required by Rules 13a- 14 and 15d- 14 under the
Securities Exchange Act of 1934, as amended (filed herewith).32
    
    Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 (filed herewith).
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SIGNATURES
  GLOBECOMM SYSTEMS INC.
(Registrant)Date: May 10, 2011
    /s/ DAVID E. HERSHBERGDavid E. HershbergChairman of the Board and
Chief Executive Officer
(Principal Executive Officer)Date: May 10, 2011
    /s/ ANDREW C. MELFIAndrew C. MelfiSenior Vice President, Chief Financial
Officer and Treasurer (Principal
Financial and Accounting Officer) 35




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Index to Exhibits:
 Exhibit No.
 31.1
    
    Chief Executive Officer Certification required by Rules 13a-14 and 15d-14 under the
Securities Exchange Act of 1934, as amended (filed herewith).31.2
    
    Chief Financial Officer Certification required by Rules 13a- 14 and 15d- 14 under the
Securities Exchange Act of 1934, as amended (filed herewith).32
    
    Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 (filed herewith).
 36