##### Table of Contents



United States Securities and Exchange Commission
 Washington, D.C. 20549
 FORM 10-Q
 (Mark One)
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the quarterly period ended June 30, 2010
 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 001-33118
 ORBCOMM INC.
  Delaware
    
    41-2118289(State or other jurisdiction 
of incorporation or organization)
    
    (I.R.S. Employer
Identification No.)
 
 
 
 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




---



##### 



Index
 Part I  Financial InformationItem 1. Condensed Consolidated Financial Statements (Unaudited):Condensed Consolidated Balance Sheets
    
    
    3Condensed Consolidated Statements of Operations
    
    
    4Condensed Consolidated Statements of Cash Flows
    
    
    5Condensed Consolidated Statements of Equity
    
    
    6Notes to Condensed Consolidated Financial Statements
    
    
    7Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    20Item 3. Quantitative and Qualitative Disclosures about Market Risks
    
    
    26Item 4. Controls and Procedures
    
    
    27Part II  Other InformationItem 1. Legal Proceedings
    
    
    27Item 1A. Risk Factors
    
    
    27Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    27Item 3. Defaults Upon Senior Securities
    
    
    27Item 5. Other Information
    
    
    27Item 6. Exhibits
    
    
    27Signatures
    
    
    28Exhibit Index
    
    
    28Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2




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##### Table of Contents



ORBCOMM Inc.
 
 Condensed Consolidated Balance Sheets
 (in thousands, except
share data)
 June 30,
    
    
    December 31,2010
    
    
    2009ASSETSCurrent assets:Cash and cash equivalents
    
    $
    15,629
    
    
    $
    65,292Restricted cash
    
    
    1,000
    
    
    
    1,000Marketable securities
    
    
    72,491
    
    
    
    26,145Accounts receivable, net of allowances for doubtful
accounts of $602 and $835
    
    
    3,945
    
    
    
    3,742Inventories
    
    
    69
    
    
    
    78Prepaid expenses and other current assets
    
    
    1,449
    
    
    
    1,253Current assets held for sale
    
    
    77
    
    
    
    575Total current assets
    
    
    94,660
    
    
    
    98,085Satellite network and other equipment, net
    
    
    74,662
    
    
    
    73,208Intangible assets, net
    
    
    1,857
    
    
    
    2,600Restricted cash
    
    
    3,030
    
    
    
    2,980Other investment
    
    
    2,250
    
    
    
    Other assets
    
    
    1,086
    
    
    
    1,354Long term assets held for sale
    
    
    
    
    
    
    2,832Total assets
    
    $
    177,545
    
    
    $
    181,059LIABILITIES AND EQUITYCurrent liabilities:Accounts payable
    
    $
    2,767
    
    
    $
    2,696Accrued liabilities
    
    
    4,914
    
    
    
    5,889Current portion of deferred revenue
    
    
    4,143
    
    
    
    3,849Current liabilities related to assets held for sale
    
    
    33
    
    
    
    79Total current liabilities
    
    
    11,857
    
    
    
    12,513Note payable  related party
    
    
    1,225
    
    
    
    1,398Deferred revenue, net of current portion
    
    
    5,833
    
    
    
    6,230Total liabilities
    
    
    18,915
    
    
    
    20,141Commitments and contingenciesEquity:ORBCOMM Inc. stockholders equityCommon stock, par value $0.001; 250,000,000 shares
authorized; 42,563,617 and 42,455,531
shares issued and outstanding
    
    
    43
    
    
    
    42Additional paid-in capital
    
    
    231,550
    
    
    
    230,512Accumulated other comprehensive income
    
    
    448
    
    
    
    76Accumulated deficit
    
    
    (75,446
    )
    
    
    (71,415
    )Total ORBCOMM Inc. stockholders equity
    
    
    156,595
    
    
    
    159,215Noncontrolling interests in ORBCOMM Japan
    
    
    2,035
    
    
    
    1,703Total equity
    
    
    158,630
    
    
    
    160,918Total liabilities and equity
    
    $
    177,545
    
    
    $
    181,059
 See notes to condensed consolidated financial statements.
  3




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##### Table of Contents



ORBCOMM Inc.
 
 Condensed Consolidated Statements of Operations
 (in thousands, except per share data)
 (Unaudited)
 Three months ended
    
    
    Six months endedJune 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Revenues:Service revenues
    
    $
    7,277
    
    
    $
    6,720
    
    
    $
    14,159
    
    
    $
    13,342Product sales
    
    
    560
    
    
    
    50
    
    
    
    1,095
    
    
    
    155Total revenues
    
    
    7,837
    
    
    
    6,770
    
    
    
    15,254
    
    
    
    13,497Costs and expenses(1):Costs of services
    
    
    3,060
    
    
    
    3,292
    
    
    
    6,196
    
    
    
    6,513Costs of product sales
    
    
    349
    
    
    
    36
    
    
    
    672
    
    
    
    96Selling, general and administrative
    
    
    4,020
    
    
    
    4,398
    
    
    
    8,182
    
    
    
    9,201Product development
    
    
    159
    
    
    
    152
    
    
    
    323
    
    
    
    341Impairment charge-satellite network
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,045Total costs and expenses
    
    
    7,588
    
    
    
    7,878
    
    
    
    15,373
    
    
    
    23,196Income (loss) from operations
    
    
    249
    
    
    
    (1,108
    )
    
    
    (119
    )
    
    
    (9,699
    )Other income (expense):Interest income
    
    
    55
    
    
    
    23
    
    
    
    92
    
    
    
    64Other income
    
    
    39
    
    
    
    388
    
    
    
    (81
    )
    
    
    339Interest expense
    
    
    (48
    )
    
    
    (48
    )
    
    
    (96
    )
    
    
    (96
    )Total other income (expense)
    
    
    46
    
    
    
    363
    
    
    
    (85
    )
    
    
    307Income (loss) from continuing operations
    
    
    295
    
    
    
    (745
    )
    
    
    (204
    )
    
    
    (9,392
    )Income (loss) from discontinued operations
    
    
    (3,479
    )
    
    
    412
    
    
    
    (3,570
    )
    
    
    (40
    )Net loss
    
    
    (3,184
    )
    
    
    (333
    )
    
    
    (3,774
    )
    
    
    (9,432
    )Less: Net income attributable to the noncontrolling interests
    
    
    112
    
    
    
    29
    
    
    
    257
    
    
    
    65Net loss attributable to ORBCOMM Inc.
    
    $
    (3,296
    )
    
    $
    (362
    )
    
    $
    (4,031
    )
    
    $
    (9,497
    )Net loss attributable to ORBCOMM Inc.:Income (loss) from continuing operations
    
    $
    183
    
    
    $
    (774
    )
    
    $
    (461
    )
    
    $
    (9,457
    )Income (loss) from discontinued operations
    
    
    (3,479
    )
    
    
    412
    
    
    
    (3,570
    )
    
    
    (40
    )Net loss attributable to ORBCOMM Inc.
    
    $
    (3,296
    )
    
    $
    (362
    )
    
    $
    (4,031
    )
    
    $
    (9,497
    )Per share information-basic:Income (loss) from continuing operations
    
    $
    0.00
    
    
    $
    (0.02
    )
    
    $
    (0.01
    )
    
    $
    (0.22
    )Income (loss) from discontinued operations
    
    
    (0.08
    )
    
    
    0.01
    
    
    
    (0.08
    )
    
    
    (0.00
    )Net loss attributable to ORBCOMM Inc.
    
    $
    (0.08
    )
    
    $
    (0.01
    )
    
    $
    (0.09
    )
    
    $
    (0.22
    )Per share information-diluted:Income (loss) from continuing operations
    
    $
    0.00
    
    
    $
    (0.02
    )
    
    $
    (0.01
    )
    
    $
    (0.22
    )Income (loss) from discontinued operations
    
    
    (0.08
    )
    
    
    0.01
    
    
    
    (0.08
    )
    
    
    (0.00
    )Net loss attributable to ORBCOMM Inc.
    
    $
    (0.08
    )
    
    $
    (0.01
    )
    
    $
    (0.09
    )
    
    $
    (0.22
    )Weighted average common shares outstanding:Basic
    
    
    42,563
    
    
    
    42,407
    
    
    
    42,561
    
    
    
    42,358Diluted
    
    
    42,613
    
    
    
    42,407
    
    
    
    42,561
    
    
    
    42,358(1) Stock-based compensation included in costs and expenses:Costs of services
    
    $
    29
    
    
    $
    14
    
    
    $
    43
    
    
    $
    34Selling, general and administrative
    
    
    557
    
    
    
    330
    
    
    
    973
    
    
    
    757Product development
    
    
    6
    
    
    
    
    
    
    
    8
    
    
    
    8$
    592
    
    
    $
    344
    
    
    $
    1,024
    
    
    $
    799
 See notes to condensed consolidated financial statements.
  4




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##### Table of Contents



ORBCOMM Inc.
 
 Condensed Consolidated Statements of Cash Flows
 (in thousands)
 (Unaudited)
 Six months endedJune 30,2010
    
    
    2009Cash flows from operating activities:Net loss
    
    $
    (3,774
    )
    
    $
    (9,432
    )Adjustments to reconcile net loss to net cash provided by
operating activities:Change in allowance for doubtful accounts
    
    
    (232
    )
    
    
    452Depreciation and amortization
    
    
    2,301
    
    
    
    2,580Accretion on note payable  related party
    
    
    66
    
    
    
    66Stock-based compensation
    
    
    1,024
    
    
    
    799Foreign
exchange losses (gains)
    
    
    83
    
    
    
    (337
    )Amortization of premium on marketable securities
    
    
    384
    
    
    
    Gain on settlement of vendor liabilities
    
    
    (220
    )
    
    
    Impairment charge-net assets held for sale
    
    
    3,261
    
    
    
    Impairment charge-satellite network
    
    
    
    
    
    
    7,045Changes in operating assets and liabilities:Accounts receivable
    
    
    (621
    )
    
    
    (360
    )Inventories
    
    
    11
    
    
    
    35Prepaid expenses and other assets
    
    
    (50
    )
    
    
    876Accounts payable and accrued liabilities
    
    
    (803
    )
    
    
    (8
    )Deferred revenue
    
    
    (359
    )
    
    
    (188
    )Net cash provided by operating activities of continuing operations
    
    
    1,071
    
    
    
    1,528Net cash provided by operating activities of discontinued operations
    
    
    23
    
    
    
    464Net cash provided by operating activities
    
    
    1,094
    
    
    
    1,992Cash flows from investing activities:Capital expenditures
    
    
    (2,655
    )
    
    
    (14,051
    )Purchases of marketable securities
    
    
    (91,800
    )
    
    
    Proceeds from maturities of marketable securities
    
    
    45,070
    
    
    
    Purchase of other investment
    
    
    (1,356
    )
    
    
    Increase in restricted cash
    
    
    (50
    )
    
    
    Net cash used in investing activities of continuing operations
    
    
    (50,791
    )
    
    
    (14,051
    )Net cash used in investing activities of discontinued operations
    
    
    
    
    
    
    (3
    )Net cash used in investing activities
    
    
    (50,791
    )
    
    
    (14,054
    )Cash flows from financing activities
    
    
    
    
    
    
    Effect of exchange rate changes on cash and cash equivalents
    
    
    34
    
    
    
    (374
    )Net decrease in cash and cash equivalents
    
    
    (49,663
    )
    
    
    (12,436
    )Cash and cash equivalents:Beginning of period
    
    
    65,292
    
    
    
    75,370End of period
    
    $
    15,629
    
    
    $
    62,934Supplemental cash flow disclosures:Noncash investing activities:Capital expenditures incurred not yet paid
    
    $
    1,260
    
    
    $
    1,126Stock-based compensation included in capital expenditures
    
    $
    14
    
    
    $
    Accounts receivable exchanged and deferred credit issued as part of
consideration for other investment
    
    $
    894
    
    
    $
    Gateway and components recorded in inventory in prior years which were used for
construction under satellite network and other equipment in 2010
    
    $
    129
    
    
    $
    
 See notes to condensed consolidated financial statements.
  5




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ORBCOMM Inc.
 
 Condensed Consolidated Statements of Equity
 Six months ended June 30, 2010 and 2009
 (in thousands, except share data)
 (Unaudited)
 Accumulated
    
    
    
    
    
    
    NoncontrollingAdditional
    
    
    other
    
    
    
    
    
    
    interestsCommon stock
    
    
    paid-in
    
    
    comprehensive
    
    
    Accumulated
    
    
    in ORBCOMM
    
    
    TotalShares
    
    
    Amount
    
    
    capital
    
    
    income
    
    
    deficit
    
    
    Japan
    
    
    equityBalances, January 1, 2010
    
    
    42,455,531
    
    
    $
    42
    
    
    $
    230,512
    
    
    $
    76
    
    
    $
    (71,415
    )
    
    $
    1,703
    
    
    $
    160,918Vesting of restricted stock units
    
    
    108,086
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    1,038
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,038Net income (loss)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,031
    )
    
    
    257
    
    
    
    (3,774
    )Cumulative translation adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    372
    
    
    
    
    
    
    
    75
    
    
    
    447Balances, June 30, 2010
    
    
    42,563,617
    
    
    $
    43
    
    
    $
    231,550
    
    
    $
    448
    
    
    $
    (75,446
    )
    
    $
    2,035
    
    
    $
    158,630Balances, January 1, 2009
    
    
    42,101,834
    
    
    $
    42
    
    
    $
    229,001
    
    
    $
    381
    
    
    $
    (67,976
    )
    
    $
    1,603
    
    
    $
    163,051Vesting of restricted stock units
    
    
    321,539
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    799
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    799Net income (loss)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (9,497
    )
    
    
    65
    
    
    
    (9,432
    )Cumulative translation adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (464
    )
    
    
    
    
    
    
    (85
    )
    
    
    (549
    )Balances, June 30, 2009
    
    
    42,423,373
    
    
    $
    42
    
    
    $
    229,800
    
    
    $
    (83
    )
    
    $
    (77,473
    )
    
    $
    1,583
    
    
    $
    153,869
 See notes to condensed consolidated financial statements.
  6




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##### Table of Contents



1. Overview
  2. Basis of Presentation
         7




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##### Table of Contents



Fair Value of Financial instruments
 Fair Value Measurement Disclosures,
  Marketable securities
  Concentration of credit risk
    Three Months ended
    
    
    Six Months endedJune 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Caterpillar Inc.
    
    
    13.8
    %
    
    
    16.7
    %
    
    
    13.5
    %
    
    
    16.1
    %Komatsu Ltd.
    
    
    15.4
    %
    
    
    11.2
    %
    
    
    13.7
    %
    
    
    11.0
    %AI, formerly a
division of General
Electric
    
    
    14.6
    %
    
    
    14.6
    %
    
    
    14.6
    %
    
    
    14.9
    %Hitachi Construction
Machinery Co., Ltd.
    
    
    11.8
    %
    
    
    
    
    
    
    12.8
    %
    
    
    
  8




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##### Table of Contents



June 30,
    
    
    December 31,2010
    
    
    2009Caterpillar Inc.
    
    
    11.3
    %
    
    
    13.9
    %AI, formerly a division of General Electric
    
    
    10.5
    %
    
    
    10.9
    %Hitachi Construction Machinery Co., Ltd.
    
    
    10.7
    %
    
    
    Komatsu Ltd.
    
    
    12.1
    %
    
    
    
 Inventories
  Income taxes
    Accounting Pronouncements
 Revenue Recognition Multiple Deliverable Revenue Arrangements
  9




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##### Table of Contents



3. Discontinued Operations
   Contingencies
  Quoted PricesIn Active
    
    
    SignificantBalance
    
    
    Markets for
    
    
    Other
    
    
    Significantas of
    
    
    Identical Assets
    
    
    Observable
    
    
    UnobservableJune 30,
    
    
    Assets
    
    
    Inputs
    
    
    Inputs
    
    
    Total2010
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)
    
    
    LossesNet assets held
for sale
    
    $
    44
    
    
    
    
    
    
    
    
    
    
    $
    44
    
    
    $
    3,261




Three months ended
    
    
    Six months endedJune 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Revenues- Product sales
    
    $
    184
    
    
    $
    375
    
    
    $
    429
    
    
    $
    1,009Income (loss) from
discontinued
operations
    
    $
    (3,479
    )
    
    $
    412
    
    
    $
    (3,570
    )
    
    $
    (40
    )




June 30,
    
    
    December 31,2010
    
    
    2009Inventories, current
    
    $
    77
    
    
    $
    575Current assets
    
    
    77
    
    
    
    575Other equipment, net
    
    
    
    
    
    
    707Inventories, long term
    
    
    
    
    
    
    2,125Current liabilities
    
    
    33
    
    
    
    79


10




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##### Table of Contents



4. Comprehensive Loss
  Three months ended
    
    
    Six months endedJune 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Net loss
    
    $
    (3,184
    )
    
    $
    (333
    )
    
    $
    (3,774
    )
    
    $
    (9,432
    )Foreign currency translation adjustment
    
    
    281
    
    
    
    (411
    )
    
    
    447
    
    
    
    (549
    )Comprehensive loss
    
    
    (2,903
    )
    
    
    (744
    )
    
    
    (3,327
    )
    
    
    (9,981
    )Comprehensive income (loss) attributable to
noncontrolling interests
    
    
    200
    
    
    
    (19
    )
    
    
    332
    
    
    
    (20
    )Comprehensive loss attributable to ORBCOMM Inc.
    
    $
    (3,103
    )
    
    $
    (725
    )
    
    $
    (3,659
    )
    
    $
    (9,961
    )
 5. Stock-based Compensation
   Three months ended
    
    
    Six months endedJune 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Stock appreciation
rights
    
    $
    454
    
    
    $
    226
    
    
    $
    766
    
    
    $
    476Restricted stock units
    
    
    138
    
    
    
    118
    
    
    
    258
    
    
    
    299Stock options
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    24Total
    
    $
    592
    
    
    $
    344
    
    
    $
    1,024
    
    
    $
    799
  Time-Based Stock Appreciation Rights
   11




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##### Table of Contents



Weighted-AverageRemaining
    
    
    AggregateNumber of
    
    
    Weighted-Average
    
    
    Contractual
    
    
    Intrinsic ValueShares
    
    
    Exercise Price
    
    
    Term (years)
    
    
    (In thousands)Outstanding at January 1,
2010
    
    
    1,166,667
    
    
    $
    5.23Granted
    
    
    828,000
    
    
    
    2.46Forfeited or expired
    
    
    
    
    
    
    Outstanding at June 30, 2010
    
    
    1,994,667
    
    
    $
    4.08
    
    
    
    8.51
    
    
    $
    3Exercisable at June 30, 2010
    
    
    755,000
    
    
    $
    5.46
    
    
    
    7.63
    
    
    $
    1Vested and expected to vest
at June 30, 2010
    
    
    1,994,667
    
    
    $
    4.08
    
    
    
    8.51
    
    
    $
    3
  Performance-Based Stock Appreciation Rights
   Weighted-AverageRemaining
    
    
    AggregateNumber of
    
    
    Weighted-Average
    
    
    Contractual
    
    
    Intrinsic ValueShares
    
    
    Exercise Price
    
    
    Term (years)
    
    
    (In thousands)Outstanding at January 1,
2010
    
    
    280,146
    
    
    $
    9.59Granted
    
    
    306,000
    
    
    
    2.46Forfeited or expired
    
    
    (21,000
    )
    
    
    1.86Outstanding at June 30, 2010
    
    
    565,146
    
    
    $
    6.02
    
    
    
    8.45
    
    
    $
    Exercisable at June 30, 2010
    
    
    259,146
    
    
    $
    10.22
    
    
    
    7.01
    
    
    $
    Vested and expected to vest
at June 30, 2010
    
    
    513,783
    
    
    $
    6.37
    
    
    
    8.33
    
    
    $
    
   12




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##### Table of Contents



Six months endedJune 30,2010
    
    
    2009Risk-free interest rate
    
    2.27% and 2.65%
    
    
    2.34%Expected life (years)
    
    5.50 and 6
    
    
    6Estimated volatility
    
    85.95% and 83.67%
    
    
    55.03%Expected dividends
    
    None
    
    
    None
 Time-Based Restricted Stock Units
   Weighted-AverageShares
    
    
    Grant Date Fair ValueBalance at January 1, 2010
    
    
    238,753
    
    
    $
    3.18Granted
    
    
    79,290
    
    
    
    2.27Vested
    
    
    (78,086
    )
    
    
    1.59Forfeited or expired
    
    
    
    
    
    
    Balance at June 30, 2010
    
    
    239,957
    
    
    $
    3.40
   Performance-Based Restricted Stock Units
    13




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##### Table of Contents



2004 Stock Option Plan
  Weighted-AverageRemaining
    
    
    AggregateNumber of
    
    
    Weighted-Average
    
    
    Contractual
    
    
    Intrinsic ValueShares
    
    
    Exercise Price
    
    
    Term (years)
    
    
    (In thousands)Outstanding at January 1, 2010
    
    
    782,079
    
    
    $
    2.98Granted
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    Forfeited or expired
    
    
    
    
    
    
    Outstanding at June 30, 2010
    
    
    782,079
    
    
    $
    2.98
    
    
    
    3.68
    
    
    $
    Exercisable at June 30, 2010
    
    
    782,079
    
    
    $
    2.98
    
    
    
    3.68
    
    
    $
    Vested and expected to vest at
June 30, 2010
    
    
    782,079
    
    
    $
    2.98
    
    
    
    3.68
    
    
    $
    
 6. Net Income (Loss) per Common Share
   Six Months endedJune 30,2010
    
    
    2009SARs
    
    
    2,559,813
    
    
    
    1,416,813RSUs
    
    
    239,957
    
    
    
    232,411Stock options
    
    
    782,079
    
    
    
    782,079Common stock warrants
    
    
    
    
    
    
    56,7243,581,849
    
    
    
    2,488,027
  14




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##### Table of Contents



7. Investments
  Marketable securities
  June 30, 2010
    
    
    December 31, 2009Gross
    
    
    Gross
    
    
    
    
    
    
    Gross
    
    
    GrossFair
    
    
    Unrealized
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    UnrealizedValue
    
    
    Losses
    
    
    Gains
    
    
    Value
    
    
    Losses
    
    
    GainsU.S. government and
agency obligations
    
    $
    42,121
    
    
    $
    2
    
    
    $
    6
    
    
    $
    13,009
    
    
    $
    
    
    
    $
    1Corporate obligations
    
    
    25,039
    
    
    
    55
    
    
    
    
    
    
    
    11,211
    
    
    
    7
    
    
    
    FDIC-insured
certificates of
deposit
    
    
    5,274
    
    
    
    6
    
    
    
    
    
    
    
    1,919
    
    
    
    
    
    
    
    $
    72,434
    
    
    $
    63
    
    
    $
    6
    
    
    $
    26,139
    
    
    $
    7
    
    
    $
    1
   Cost method investment
   15




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##### Table of Contents



8. Satellite Network and Other Equipment
  Useful life
    
    
    June 30,
    
    
    December 31,(years)
    
    
    2010
    
    
    2009Land
    
    
    
    
    
    $
    381
    
    
    $
    381Satellite network
    
    
    3-10
    
    
    
    28,249
    
    
    
    27,814Capitalized software
    
    
    3-5
    
    
    
    1,355
    
    
    
    1,318Computer hardware
    
    
    5
    
    
    
    1,208
    
    
    
    1,144Other
    
    
    5-7
    
    
    
    1,259
    
    
    
    1,105Assets under construction
    
    
    
    
    
    
    68,772
    
    
    
    66,450101,224
    
    
    
    98,212Less: accumulated depreciation and amortization
    
    
    
    
    
    
    (26,562
    )
    
    
    (25,004
    )$
    74,662
    
    
    $
    73,208
    9. Restricted Cash
     16




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##### Table of Contents



10. Intangible Assets
  March 31, 2010
    
    
    December 31, 2009Useful life
    
    
    
    
    
    
    Accumulated
    
    
    
    
    
    
    
    
    
    
    Accumulated(years)
    
    
    Cost
    
    
    amortization
    
    
    Net
    
    
    Cost
    
    
    amortization
    
    
    NetAcquired licenses
    
    
    6
    
    
    $
    8,115
    
    
    $
    (6,258
    )
    
    $
    1,857
    
    
    $
    8,115
    
    
    $
    (5,515
    )
    
    $
    2,600
   Years ending December 31,Remainder of 2010
    
    $
    7432011
    
    
    1,114$
    1,857
 11. Accrued Liabilities
  June 30,
    
    
    December 31,2010
    
    
    2009Accrued compensation and benefits
    
    $
    1,527
    
    
    $
    1,812Accrued interest
    
    
    827
    
    
    
    797Deferred rent payable
    
    
    447
    
    
    
    919Other accrued expenses
    
    
    2,113
    
    
    
    2,361$
    4,914
    
    
    $
    5,889
 12. Deferred Revenues
  June 30,
    
    
    December 31,2010
    
    
    2009Professional services
    
    $
    5,995
    
    
    $
    6,437Service activation fees
    
    
    2,450
    
    
    
    2,563Manufacturing license fees
    
    
    37
    
    
    
    44Prepaid services
    
    
    1,494
    
    
    
    1,0359,976
    
    
    
    10,079Less current portion
    
    
    (4,143
    )
    
    
    (3,849
    )Long-term portion
    
    $
    5,833
    
    
    $
    6,230
  13. Note Payable
   17




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##### Table of Contents



14. Stockholders Equity
  15. Geographic Information
  Three months ended
    
    
    Six months endedJune 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009United States
    
    
    79
    %
    
    
    87
    %
    
    
    79
    %
    
    
    86
    %Japan
    
    
    15
    %
    
    
    10
    %
    
    
    16
    %
    
    
    10
    %Other
    
    
    6
    %
    
    
    3
    %
    
    
    5
    %
    
    
    4
    %100
    %
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
 16. Commitments and Contingencies
 Procurement agreements in connection with next-generation satellites
      18




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##### Table of Contents



Airtime credits
  Litigation
   19




---



##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations
 Safe Harbor Statement Under the Private Securities Litigation Reform of Act 1995.
  Overview
      20




---



##### Table of Contents



Discontinued Operations
  Cost Method Investment
  Critical Accounting Policies
   21




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##### Table of Contents



EBITDA
   The following table (in thousands) reconciles our net loss to EBITDA for the periods shown:
 Three months ended June 30,
    
    
    Six months ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Net loss
    
    $
    (3,296
    )
    
    $
    (362
    )
    
    $
    (4,031
    )
    
    $
    (9,497
    )Interest income
    
    
    (55
    )
    
    
    (23
    )
    
    
    (92
    )
    
    
    (64
    )Interest expense
    
    
    48
    
    
    
    48
    
    
    
    96
    
    
    
    96Depreciation and
amortization
    
    
    904
    
    
    
    1,297
    
    
    
    2,301
    
    
    
    2,598$
    (2,399
    )
    
    $
    960
    
    
    $
    (1,726
    )
    
    $
    (6,867
    )
   Results of Operations
 Revenues
  i.e.
  22




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##### Table of Contents



Three months ended June 30,
    
    
    Six months ended June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009% of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % of
    
    
    
    
    
    
    % ofTotal
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    Total
    
    
    
    
    
    
    TotalService revenues
    
    $
    7,277
    
    
    
    92.9
    %
    
    $
    6,720
    
    
    
    99.3
    %
    
    $
    14,159
    
    
    
    92.8
    %
    
    $
    13,342
    
    
    
    98.9
    %Product sales
    
    
    560
    
    
    
    7.1
    %
    
    
    50
    
    
    
    0.7
    %
    
    
    1,095
    
    
    
    7.2
    %
    
    
    155
    
    
    
    1.1
    %$
    7,837
    
    
    
    100.0
    %
    
    $
    6,770
    
    
    
    100.0
    %
    
    $
    15,254
    
    
    
    100.0
    %
    
    $
    13,497
    
    
    
    100.0
    %
   Service revenues
     Product sales
    Costs of services
      23




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##### Table of Contents



Costs of product sales
     Selling, general and administrative expenses
    Product development expenses
    Impairment Charge  Satellite Network
  Other income (expense)
    Income
(loss) from continuing operations
    24




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##### Table of Contents



Income
(loss) from discontinued operations
    Noncontrolling interests
  Net loss attributable to ORBCOMM Inc.
   Liquidity and Capital Resources
 Overview
  Operating activities
    Investing activities
     25




---



##### Table of Contents



Financing activities
  Future Liquidity and Capital Resource Requirements
  Contractual Obligations
  Off-Balance Sheet Arrangements
  Recent accounting pronouncements
 Revenue Recognition Multiple Deliverable Revenue Arrangements.
 
 Item 3. Quantitative and Qualitative Disclosures about Market Risks
  Concentration of credit risk
  Three Months ended
    
    
    Six Months endedJune 30,
    
    
    June 30,2010
    
    
    2009
    
    
    2010
    
    
    2009Caterpillar Inc.
    
    
    13.8
    %
    
    
    16.7
    %
    
    
    13.5
    %
    
    
    16.1
    %Komatsu Ltd.
    
    
    15.4
    %
    
    
    11.2
    %
    
    
    13.7
    %
    
    
    11.0
    %AI, formerly a division of General Electric
    
    
    14.6
    %
    
    
    14.6
    %
    
    
    14.6
    %
    
    
    14.9
    %Hitachi Construction Machinery Co., Ltd.
    
    
    11.8
    %
    
    
    
    
    
    
    12.8
    %
    
    
    
  26




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##### Table of Contents



Item 4. Disclosure Controls and Procedures
 Evaluation of the Companys disclosure controls and procedures.
 Internal Control over Financial Reporting.
 
 PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 5. Other Information 
   
 Item 6. Exhibits
 31.1
    
    
    Certification of President and Chief Executive Officer required by Rule 13a-14(a).31.2
    
    
    Certification of Executive Vice President and Chief Financial Officer required by Rule 13a-14(a).32.1
    
    
    Certification of President and Chief Executive Officer required by Rule 13a-14(b) and 18 U.S.C.
Section 1350.32.2
    
    
    Certification of Executive Vice President and Chief Financial Officer required by Rule 13a-14(b)
and 18 U.S.C. Section 1350.
  27




---



##### Table of Contents



SIGNATURES
  ORBCOMM Inc.
(Registrant)Date: August 9, 2010
    /s/ Marc J. EisenbergMarc J. Eisenberg,President and Chief Executive Officer
(Principal Executive Officer)Date: August 9, 2010
    /s/ Robert G. CostantiniRobert G. Costantini,Executive Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer) 
 EXHIBIT INDEX
 ExhibitNo.
    
    Description31.1
    
    
    Certification of Chief Executive Officer and President required by Rule 13a-14(a).31.2
    
    
    Certification of Executive Vice President and Chief Financial Officer required by Rule 13a-14(a).32.1
    
    
    Certification of Chief Executive Officer and President required by Rule 13a-14(b) and 18 U.S.C.
Section 1350.32.2
    
    
    Certification of Executive Vice President and Chief Financial Officer required by Rule 13a-14(b)
and 18 U.S.C. Section 1350.
  28