**Exhibit 10.1**

 

**CONFIDENTIAL TREATMENT**

 

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

 

**PURCHASE AGREEMENT**

 

**BETWEEN**

 

**ERICSSON FEDERAL INC.**

 

**AND**

 

**GLOBALSTAR, INC.**

 

**FOR**

 

**GLOBALSTAR’SSECOND GENERATION GATEWAY**

**CORENETWORK DEVELOPMENT**

 

**CONTRACT NUMBER GINC-C-08-0400**

 

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**Contents**

 
| 1. Scope of  Agreement                                                                                                                                        | 3  |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------|----|
| 2. Order of Precedence                                                                                                                                        | 4  |
| 3. Options                                                                                                                                                    | 4  |
| 4. Term                                                                                                                                                       | 5  |
| 5. Statement of Work                                                                                                                                          | 5  |
| 6. Performance  Schedule                                                                                                                                      | 6  |
| 7. Acceptance                                                                                                                                                 | 6  |
| 8. Access to  Work in Progress                                                                                                                                | 7  |
| 9.  Delivery, Title and Risk of Loss                                                                                                                          | 8  |
| 10. Prices and Fees                                                                                                                                           | 8  |
| 11.  Out-of-Pocket Expenses                                                                                                                                   | 9  |
| 12. Taxes and Duties                                                                                                                                          | 9  |
| 13. Invoicing  and Payment                                                                                                                                    | 9  |
| 14.  Intellectual Property Rights                                                                                                                             | 10 |
| 15. Intellectual Property Rights Indemnity                                                                                                                    | 12 |
| 16. Indemnification and Insurance                                                                                                                             | 14 |
| 17. Globalstar-Furnished Facilities                                                                                                                           | 15 |
| 18. Warranty                                                                                                                                                  | 15 |
| 19.  Confidentiality                                                                                                                                          | 16 |
| 20.  Limitation of Liability                                                                                                                                  | 17 |
| 21.  Termination for Cause                                                                                                                                    | 18 |
| 22. Termination for Convenience/ Stop Work Orders                                                                                                             | 18 |
| 23. Government Authorizations                                                                                                                                 | 19 |
| 24. Restriction of Hazardous Substances (“ROHS”);  Waste Electrical and Electronic Equipment (“WEEE”); and Packaging and  Packaging Waste | 21 |
| 25.  Assignment of Agreement                                                                                                                                  | 22 |
| 26. Key  Personnel                                                                                                                                            | 22 |
| 27. Communication and Authority                                                                                                                               | 23 |
| 28.  Dispute Resolution                                                                                                                                       | 24 |
| 29. Changes                                                                                                                                                   | 24 |
| 30. Public Release of Information                                                                                                                             | 26 |
| 31.  Force Majeure                                                                                                                                            | 27 |
| 32.  Relationship                                                                                                                                             | 27 |
| 33.  Miscellaneous                                                                                                                                            | 27 |

 

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**PURCHASE AGREEMENT**

 

THIS PURCHASE AGREEMENT,GINC-C-08-0400 (this “Agreement”), effective as of October 1, 2008 (the “EffectiveDate of Contract” or “EDC”), is entered into by and between Ericsson FederalInc., a Delaware corporation (“Ericsson”), with a place of business at 1595Spring Hill Rd., Vienna, VA 22182 and Globalstar, Inc., a Delawarecorporation (“Globalstar”) with its principal place of business at 461 SouthMilpitas Boulevard, Milpitas, California 95035 (each a “party” and collectivelythe “parties”).

 

WHEREAS, Globalstar desires to retain a qualified supplier to provideProducts and Services with respect to Globalstar’s Second Generation GatewayCore Network Development; and

 

WHEREAS, Globalstar and Ericsson have agreed that the businessstructure established pursuant to this Agreement will achieve the objectivescontemplated by the parties in establishing the terms and conditions upon whichEricsson will provide to Globalstar, and Globalstar will purchase fromEricsson, those certain specified Products and Services.

 

NOW, THEREFORE, Ericsson and Globalstar hereby agree as follows:

 

# **1. Scopeof Agreement**

# ** **

Subjectto the terms and conditions of this Agreement and payment of $22,651,151 inaccordance with the Payment Milestones set forth in Exhibit C, PaymentMilestones, Ericsson agrees to deliver to Globalstar the Products and Serviceslisted in the attached Exhibit A, Pricing Schedule, as further set forthin Exhibit D, Statement of Work and defined in Exhibit E, Statementof Compliance.

 

Thefollowing Exhibits are incorporated into this Agreement and made a part hereof:

 
| Exhibit A |   | Pricing  Schedule                                                                      |
|----------------|--------|----------------------------------------------------------------------------------------|
| Exhibit B |   | Termination  Liability Schedule                                                        |
| Exhibit C |   | Payment  Milestones                                                                    |
| Exhibit D |   | Statement  of Work for Globalstar 2nd Generation Gateway Core Network Development |
| Exhibit E |   | Statement  of Compliance                                                               |
| Exhibit F |   | Expansion  Pricing and Options                                                         |
| Exhibit G |   | Statement  of Work for Expansion Products (as agreed to by the parties)                |
| Exhibit H |   | Spares  List                                                                           |
| Exhibit I |   | Definitions                                                                            |
| Exhibit J |   | Globalstar  Travel Policy                                                              |

 

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# ** **

# **2. Orderof Precedence**

# ** **

Shouldany ambiguity or conflict arise between any Exhibits hereto and the AgreementArticles of this document, such ambiguity or conflict shall be resolved byfollowing order of precedence as set forth below:

 

AgreementArticles of this document

 

Exhibit I– Definitions

Exhibit D– Statement of Work for Globalstar 2nd Generation Gateway Core Network Development

Exhibit G– Statement of Work for Expansion Products (as agreed to by the parties)

Exhibit J– Globalstar Travel Policy

Exhibit E– Statement of Compliance

Exhibit A– Pricing Schedule

Exhibit F– Expansion Pricing and Options

Exhibit B– Termination Liability Schedule

Exhibit C– Payment Milestones

Exhibit H– Spares List

 

# **3. Options**

# ** **

Globalstar shall have theunilateral right to exercise any option as set forth in Exhibit F,Expansion Pricing and Options. Globalstar may exercise such option by providing written notice toEricsson no later that the expiration of the Option Validity Period which ishereby defined to be the expiration of the term of this Agreement as set forthin Article 4, Term. The option price is firm fixed price for the durationof the Initial Term of this Agreement. If an option is exercised or an order for an optional item is placedafter the Initial Term of this Agreement, up to the 10th anniversary of EDC theprice for such item shall be subject to escalation to be capped at [*] perannum.  Following the tenth (10th)anniversary of EDC the availability of any optional items hereunder will besubject to mutually agreed terms and conditions. Such exercised options ororders will be incorporated into the Agreement through the written ChangeRequest process set forth in Article 29, Changes.  Each Contract Change Notice shall includeupdates, as required, to the Exhibits of the Agreement.  Globalstar shall provide a forecast toEricsson 3 months in advance of exercise of any option.  Delivery of Products under any exercisedoption is 8 weeks after exercise of option, provided Ericsson has received theforecast 3 months in advance as referenced above.

 

Forthe sake of clarification, Globalstar shall have the option to extend theCustomer Support as described in Exhibit F – Expansion Pricing andOptions, and consistent with Section 5 of Exhibit D, Statement ofWork for an additional three (3) years in one three year increment at theoption prices as set forth in Exhibit F – Expansion Pricing and Options.Support may be provided in additional three year increments subject to themutual agreement of the parties. Globalstar shall deliver written notice of its election to implementsuch extensions not less than 90 days prior to the end of the applicable period

 

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beingextended.  Payments for such extensionsshall be invoiced quarterly in advance of each quarterly period starting at thebeginning of the extension period with payment due in accordance with Article 13,Invoicing and Payments.

 

# **4. Term**

# ** **

The Initial Term of this Agreement will commence at EDC and willcontinue for a period of five (5) years, unless sooner terminated inaccordance with the provisions hereof. This Agreement will automatically extend for successive one (1) yearperiods unless sooner terminated in accordance with the provisions hereof.

 

# **5.Statement of Work**

# ** **

(A) Underthis Agreement, Ericsson shall deliver “Work” as set forth below:

 

(a)  Products as set forth in Exhibit A – Pricing Schedule

(i)   Hardware (includingthird party hardware);

(ii)  Software (software executable code and firmware, includingsame from third parties)

(iii) Documentation (technical data, manuals, drawings anddocuments, including same from third parties); and

 

(b)  Services (including Customer Support).

 

(B) AdditionalProducts and Services set forth in Exhibit F - Expansion Pricing andOptions, may be provided by Ericsson to Globalstar in accordance with aStatement of Work mutually agreed to by Ericsson and Globalstar from time totime during the term of this Agreement (“Statement of Work for ExpansionProducts”). Each such Statement of Work for Expansion Products will, at aminimum, include the following:

 

(a)           A reference to this Agreement, whichreference will be deemed to incorporate all applicable provisions of this Agreement.

 

(b)           The date as of which the Statement of Workfor Expansion Products will be effective, and, if applicable, the term orperiod of time during which Ericsson will provide the applicable Products andServices to Globalstar pursuant to that Statement of Work for ExpansionProducts.

 

(c)           A description of the Products and Services tobe provided by Ericsson to Globalstar pursuant to the Statement of Work forExpansion Products, including, but not limited to, the deliverables to beprovided as part of the applicable Products and Services pursuant to thatStatement of Work.

 

(d)           The amounts payable to Ericsson by Globalstar for the Products andServices to be provided under the applicable Statement of Work for ExpansionProducts.

 

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(e)           Additional payment milestones and termination liabilities for theExpansion Products provided under that Statement of Work for Expansion Productsthat are not otherwise set forth in this Agreement.

 

No Statement of Workfor Expansion Products will become effective until a formal amendment to theAgreement, incorporating such Statement of Work into this Agreement, has beenexecuted by an authorized representative of both Ericsson and Globalstar.

 

Inthe event of any express conflict or inconsistency between the provisions ofthis Agreement and the provisions of any Statement of Work for ExpansionProducts, the provisions of this Agreement will control with respect to theinterpretation of that Statement of Work.

 

# **6.Performance Schedule**

# ** **

TheWork, as defined in Article 5, Statement of Work, and as set forth in Exhibit D,Statement of Work, shall be performed in accordance with the schedule detailedin Exhibit D, Statement of Work, and Exhibit E, Statement ofCompliance.  Such schedule shall beadjusted on an equitable basis pursuant to the Change procedure set out in Article 29,Changes of this Agreement in respect of (i) any delays attributable to anyevents of excusable delay referenced in Article 31, Force Majeure, of thisAgreement or (ii) delays by Globalstar in acting or performing as requiredunder this Agreement including any delay or failure to furnish the requiredequipment, services or property pursuant to Section 4 of Exhibit D,  Statement of Work, of this Agreement

 

# **7.Acceptance**

# ** **

A.            All deliverable Work specified in Exhibit D,Statement of Work, and all Payment Milestones as defined is Exhibit C,Payment Milestones, shall be subject to acceptance of such Work by Globalstarin accordance with this Article 7.

 

Postponement of acceptance by Globalstar dueto any deficiencies not attributable to Ericsson will be deemed acceptance ofsuch Milestone.

 

B.            Installation/ Delivery Acceptance

 

   Upon installation of theapplicable Products for the lab and sites 1-3 and upon delivery of theapplicable Products for sites 4-9, Ericsson will conduct acceptance testing inaccordance with the procedures and requirements set forth in Exhibit D –Statement of Work and Exhibit E – Statement of Compliance to demonstratethat such Products operate in material conformance with the applicablespecifications in accordance with the applicable acceptance test plan andacceptance criteria as mutually agreed upon 60 days prior to the commencementof the installation. Upon successful completion of the applicable acceptancetesting, Ericsson will provide Globalstar with a Certificate of 

 

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Acceptance for such installation. Within ten (10) businessdays following its receipt of the Certificate of Acceptance, Globalstar willeither (i) sign and return to Ericsson the Certificate of Acceptance,confirming Globalstar ‘sacceptance of such installation, or (ii) notify Ericsson in writing ofGlobalstar’s rejection of such installation, together with the specificdeficiencies constituting the grounds for such rejection; provided that either (1) Globalstar ‘s failure to so provide Ericsson with suchwritten notification of rejection within such 10-business-day period, or (2) Globalstar’scommercial use of such Products, or a portion thereof, will constituteacceptance of such installation. Only service-affecting deficiencies shall begrounds for delay of the applicable acceptance of such installation. Prior toor upon Globalstar’s acceptance of the installation, Globalstar may provide Ericsson with a written punchlistof the non-conformities of such installed Product (the “Punchlist”). Withinfifteen (15) days following the acceptance of such Product, Globalstar may update such Punchlist by adding thenon-conformities of the Product identified by Globalstar after the acceptance. Ericsson shall promptlycorrect the non-conformities identified in the Punchlist. Upon Ericsson’ssuccessful correction of such non-conformities, Ericsson shall submit toGlobalstar, and Globalstar shallsign, a certificate verifying that no further Punchlist items remainunresolved.

 

C.            PaymentMilestone Acceptance

 

Acceptance of Payment Milestones as defined in Exhibit C– Payment Milestones, to the extent they are not included in 7 B above, shalloccur upon successful completion of the Payment Milestone in accordance withthe acceptance criteria as mutually agreed upon 60 days prior to the definedcompletion date of eachPayment Milestone. Upon successfulcompletion of the applicable acceptance criteria, Ericsson will provide Globalstar with a Certificate of Acceptance for eachsuch Payment Milestone. Within ten (10) business days following itsreceipt of the Certificate of Acceptance, Globalstar will either (i) sign and return toEricsson the Certificate of Acceptance, confirming Globalstar ‘s acceptance of such Milestone, or (ii) notifyEricsson in writing of Globalstar’s rejection of the Milestone, together withthe specific deficiencies constituting the grounds for such rejection; providedthat either (1) Globalstar ‘s failure to so provide Ericsson with such written notification ofrejection within such 10-business-day period, or (2) Globalstar’scommercial use of the deliverables, or a portion thereof, will constituteacceptance of the Payment Milestone. Prior to or upon Globalstar’s acceptanceof the Payment Milestone, Globalstar may provide Ericsson with a written punchlist of the non-conformities(the “Punchlist”). Within fifteen (15) days following the acceptance of thePayment Milestone, Globalstar may update such Punchlist by adding the non-conformities of the PaymentMilestone identified by Globalstar after the acceptance. Ericsson shall promptly correct thenon-conformities identified in the Punchlist. Upon Ericsson’s successfulcorrection of such non-conformities, Ericsson shall submit to Globalstar, andGlobalstar shall sign, acertificate verifying that no further Punchlist items remain unresolved.

 

# **8. Accessto Work in Progress**

# ** **

A.            Globalstar shall have the right, at all reasonabletimes during the performance of this Agreement, and at Globalstar’s soleexpense, to monitor the Work in progress

 

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atthe plants of Ericsson, provided that Globalstar gives reasonable notice toEricsson.  Visits shall be on anon-interfering basis subject to Ericsson’s standard security andconfidentiality procedures.

 

B.            To the extent necessary to implement thisArticle, and with the consent of any affected subcontractors, Ericsson shallpass through the provisions hereof into all subcontracts with suppliers ofcritical path items.

 

C.            In no event shallEricsson be liable if Globalstar’s monitoring delays or otherwise prevents theperformance, delivery or acceptance of Ericsson Work under this Agreement.

 

# **9.Delivery, Title and Risk of Loss**

# ** **

Exceptas the parties may otherwise agree to, Ericsson shall deliver the Productaccording to INCOTERMS 2000, Delivery Duty Unpaid named place of destinationand according to the agreed upon delivery schedule.  ‘Delivery Duty Unpaid’ (named place ofdestination) means that Ericsson delivers the Products to Globalstar, notcleared for import, and not unloaded from any arriving means of transport atthe ‘named place of destination’. Ericsson has to bear the costs and risks involved in the bringing theProducts thereto, other than, where applicable, any ‘duty’ (which term includesthe responsibility for and the risks of carrying out of customs formalities,and the payment of formalities, customs duties, taxes and other charges) forimport in the country of destination. Such ‘duty’ has to be borne by Globalstar as well as any costs and riskscaused by Globalstar’s failure to clear the Products for import in time.Ericsson will make reasonable commercial efforts to minimize the number ofshipments to each site.

 

Titleand risk of loss or damage to the Products will pass to Globalstar uponEricsson’s delivery to the named place of destination.  Notwithstanding the foregoing, Globalstarhereby grants to Ericsson a lien on and a security interest (which, to thefullest extent permitted by law, shall be deemed to be a purchase moneysecurity interest) in and to each such Product and any and all proceeds thereofto secure the payment in full of the purchase price for such Product.  Globalstar agrees to cooperate with Ericssonto create, preserve, perfect or validate such lien and security interest in anyjurisdiction, and Ericsson may at any time file a copy of this Agreement as afinancing statement with any filing office in any jurisdiction.

 

# **10. Pricesand Fees**

# ** **

TheTotal Purchase Price shall be a firm fixed-price Twenty Two Million Six HundredFifty One Thousand One Hundred Fifty One United States Dollars (US$22,651,151)for the Work which may be amended from time to time in accordance with thisAgreement.  For the sake ofclarification, there is an additional time and materials component of the Work.The commitment for the Total Purchase Price listed in Exhibit A, PaymentMilestones, shall arise upon execution of this Agreement by the parties,without 

 

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theneed to issue any purchase order or other similar documentation in connectionherewith. The commitment for the purchase price of any Expansion Products to belisted in a Statement of Work for Expansion Products shall arise upon executionby an authorized representative of both Ericsson and Globalstar of an amendmentincorporating such Statement of Work into this Agreement.

 

# **11.Out-of-Pocket Expenses**

# ** **

With regard to any mutually approved time-and-materials Work, Globalstarwill pay or reimburse Ericsson for any reasonable out-of-pocket expenses, suchas travel and associated expenses, reasonably incurred by Ericsson inconnection with the performance of this Agreement so long as Ericsson requestsand estimates the magnitude of such expenses and receives Globalstar approvalin advance. All travel must be consistent with Exhibit J, GlobalstarTravel Policy, and invoiced as direct “pass through” actual and reasonablecosts with no loading for indirect costs or profit.

 

# **12. Taxesand Duties**

# ** **

Globalstar shall be responsible for all sales and use taxes and export orimport duties or value-added taxes or similar charges under any present orfuture national, federal, state or local laws which may arise and which becomedue by reason of the delivery of any Product or Service and by reason of thesupply of any Globalstar equipment or other Globalstar property toEricsson.  Globalstar will pay and discharge,either directly to the governmental agency or as billed by Ericsson, theforegoing taxes, duties and charges.

 

# **13.Invoicing and Payment**

# ** **

A.            The Total Purchase Price referred to in Article 10,Prices and Fees, shall be paid by Globalstar in accordance with Exhibit A,Pricing Schedule, and Exhibit C, Payment Milestones, and with the terms ofthis Article.

 

B.            With respect to each amount specified in Exhibit C,Payment Milestones, Ericsson shall submit an invoice to Globalstar when therelevant milestone has been completed and accepted per the Acceptance procedurein Article 7.

 

C.            Globalstar shall pay each invoice for PaymentMilestones within 30 days of receiving each invoice after having providedEricsson with a signed Certificate of Acceptance or within 30 days of the dateof deemed Acceptance per Article 7. Globalstar shall pay each invoice fortime and material within 30 days of receiving such invoice.

 

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Unlessotherwise notified in writing by Ericsson, all transfers of funds to Ericssonin accordance with this Agreement shall be sent by wire transfer to thefollowing bank account:

 

Accountof Ericsson Federal Inc.

[*]

 

D.            All invoices shall be submitted by email to[*] with email copy to Globalstar employees to be identified at a later date.

 

E.             Any payment due from Globalstar shall bedeemed to have been paid when the funds are disbursed from Globalstar’s bank,destined to Ericsson’s bank account referenced above.  If any payment is due on any day that is nota business day, such payment shall be due on the succeeding business day.  A late payment charge, at an annual rate of[*], will be applied to any payment not received by the due date thereof.

 

F.             Invoicing by Ericsson and payment for anearly completion of a milestone is subject to Globalstar’s prior writtenapproval.

 

# **14.  Intellectual Property Rights**

# ** **

A.            Definitions

 

Asused in this Agreement, the following terms shall have the definitionsindicated:

 

(1)           “Ericsson Background IP” means all IP owned or controlled by Ericssonas of EDC, and all IP conceived or developed by Ericsson after EDC (other thanin performance under this Agreement), which is incorporated in or necessary forthe use (as provided for herein) of the Work being delivered pursuant to thisAgreement.

 

(2)           “Ericsson Foreground IP” means all IP conceived or developed by or onbehalf of Ericsson arising from Ericsson’s performance under this Agreement,which is incorporated in or necessary for the use of (as provided for herein)of the Work being delivered pursuant to this Agreement.

 

(3)           “Core Network System” or “CN” means the core network system and other network deliverables beingdeveloped and provided by Ericsson pursuant to this Agreement.

 

(4)           “Globalstar System” means the system including satellites, CN, RadioAccess Network (RAN), ground control network, network control centers,

 

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RemoteTerminal Diagnostic Monitor and User Terminals operated by Globalstar toprovide low earth orbit satellite based wireless telecommunication servicesworldwide.

 

(5)           “Intellectual Property” or “IP” means all information, data andtechnology (including all ideas, discoveries, inventions, methods, techniquesand processes, designs, improvements and innovations, all specifications,requirements, software and other works of authorship (including documentationsuch as manuals, drawings and documents), and all know-how), whether or notpatentable and whether or not reduced to practice, and all associated rights inand to any patents and patent applications, copyrights and trade secrets, andall other intellectual and industrial property rights and all forms ofprotection of any similar nature (including all such rights in software) whichmay subsist in any part of the world for the full term of such rights includingany extension to the term of such rights.

 

(6)           “User Terminal” means a mobile satellite terminal used for subscribercommunication over the Globalstar satellite network.

 

B.            Ownership of Intellectual Property Rights

 

(1) All Ericsson Background IP shall remain the sole and exclusive property ofEricsson.

 

(2)  All Ericsson Foreground IP shall be exclusively owned byEricsson, its suppliers or licensors.

 

C.            License Rights Granted by Ericsson

 

Subjectto fulfillment by Globalstar of its obligations under this Agreement, Ericssonhereby grants to Globalstar a worldwide, non-exclusive, perpetual, irrevocable,non-transferable, non-assignable, fully paid-up license to use, duplicate(Documentation and Software (for archival and backup purposes only)) anddisclose the Ericsson Background IP and the Ericsson Foreground IP associatedwith the CN solely for the purposes of the use, operation and maintenance ofthe Globalstar System.  The foregoinglicense rights include the right of Globalstar to sublicense to third partiesand to contract with a third party for the purposes set forth above. For thesake of clarification, Globalstar shall use the Software solely on or with asingle unit or arrangement of Hardware for which the Software was delivered.

 

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D.            Other Right and License Considerations

 

## **(1) **This Agreement applies to all updates, upgrades,maintenance releases, revisions and enhancements for theSoftware which Ericsson may supply to Globalstar from time to time.

## ** **

## **(2) Globalstar may make one copy ofany Software for backup and archival purposes if the copy contains all of theEricsson proprietary notices contained in the original Software.  Globalstar may make multiple copies of anyDocumentation if such copies contain all of the Ericsson proprietary notices containedin the original Documentation.**

## ** **

## **(3) Globalstar shall not directlyor indirectly: (a) modify, copy (except as allowed for backup and archivalpurposes), transmit, alter, merge, decompile, disassemble, reverse engineer oradapt any portion of the Software; (b) encumber, time-share, rent or leasethe rights granted herein; (c) manufacture, adapt, create derivative worksof, localize, port or otherwise modify any Software; or (d) disclose orotherwise make available the Software to any third party, without Ericsson’sprior written consent, except as permitted in Article 14 C (1) above.  For the sake of clarification, Globalstarshall have the right to utilize the open interfaces of the CN to addfunctionality or features (e.g., HLR/HSS and application servers) to the CN.**

## ** **

## **(4)  Exceptas expressly set forth in this Agreement, no right or license is either grantedor implied by either party to the other with respect to any technical orbusiness information, or with respect to rights in any patents, trademarks,copyrights, trade secrets, mask work protection rights, and other intellectualproperty.**

## ** **

## **(5)  In the event Ericsson fails tocontinue to offer or make available to Globalstar the 2G/3G roaming solution,as defined in Exhibit E, Statement of Compliance, then Ericsson agrees togrant Globalstar the right to use the design and engineering documentationcreated for Globalstar hereunder for the purposes of supporting, creatingand/or modifying the 2G/3G roaming solution. For clarification purposes, the rights granted herein do not apply tosoftware or hardware that is not produced by Ericsson.**

## ** **

# **15.  Intellectual Property Rights Indemnity**

# ** **

A.            Ericssonshall, at its own expense, (i) indemnify and defend Globalstar in anyclaim or legal action in the United States, alleging that the use, sale or offerfor sale of any Product provided by Ericsson to Globalstar hereunder or anyportion thereof, directly infringes any patent, trademark or copyright of anythird party (“Infringement Claim”); and (ii) pay any settlement reached orfinal award, including reasonable attorney’s fees, for infringement. As acondition of such defense or payment, Globalstar is required to (i) giveEricsson prompt written notice of any Infringement Claim; (ii) provideEricsson with the sole control of the defense and/or settlement of theInfringement Claim; (iii) cooperate fully with Ericsson in such defense orsettlement.  Globalstar may, at its ownexpense, 

 

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participatefully in the defense of any such Infringement Claim. For the sake ofclarification, the foregoing applies to Infringement Claims involving EricssonBackground IP and Ericsson Foreground IP.

 

B.            In the event Ericsson becomes aware of apotential Infringement Claim, Ericsson shall use its reasonable best efforts toavoid an interruption of Globalstar service and may (or in the case of an awardof an injunction, shall) at its sole option and expense:  (i) procure for Globalstar the right tocontinue using the alleged infringing Product(s); (ii) replace or modifythe alleged infringing Product(s) with an equivalent product(s) sothat Globalstar’ use is non-infringing; or (iii) if the remedies under theforegoing clauses (i) and (ii) are not commercially feasible, requireGlobalstar to return the affected portion of the Product(s) and refund toGlobalstar the depreciated value (as carried on the Globalstar’ books) of suchProduct(s).

 

C.            Ericsson has no obligation or liability inrespect to any Infringement Claim in the event that the affected Product: (i) ismanufactured, designed or supplied by Ericsson in accordance with any design orspecial instruction furnished by Globalstar where such forms the basis of theInfringement Claim; (ii) is used by Globalstar in a manner or for apurpose not contemplated by this Agreement or Ericsson’s Product documentation;(iii) is used by Globalstar in combination with other products orapplications not provided by Ericsson under this Agreement, including anysoftware developed by Globalstar through the permitted use of Products, providedthat the Infringement Claim arises from such combination or the use thereof; or(iv) is modified by Globalstar, provided the Infringement Claim arisesfrom such modification (“Other Claims”). If Globalstar continues use of theaffected Product notwithstanding Ericsson’s request to replace or modifypursuant to Article 15(B) (ii) or its requirement to returnpursuant to Article 15(B) (iii), Ericsson shall not be liable forsuch use.  Globalstar shall indemnifyEricsson against all liability and costs of defense, including reasonableattorneys’ fees, for any and all claims against Ericsson for infringement basedupon any of the foregoing.

 

D.            THE PROVISIONS OF THIS ARTICLE 15 CONSTITUTETHE EXCLUSIVE RECOURSE OF EACH PARTY AND THE ENTIRE OBLIGATION AND LIABILITY OFEACH PARTY WITH RESPECT TO ANY CLAIM FOR INFRINGEMENT OF INTELLECTUAL PROPERTYRIGHTS.

 

E.             Ericsson agrees that the provisions of this Article shallapply to any Product modified by Ericsson pursuant to Paragraph 15 B (ii) ofthis Article.

 

F.             Globalstar will indemnify Ericsson from anyand all damages and costs (including settlement costs) finally awarded oragreed upon for infringement of any United States patent or copyright in anylawsuit resulting from Other Claims, and for reasonable expenses incurred byEricsson in defense of such lawsuit if Globalstar does not undertake thedefense thereof.

 

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# **16.  Indemnification and Insurance**

# ** **

A.            Ericsson shall indemnify and hold harmlessGlobalstar, and its subsidiaries and affiliates, and its subcontractors (ifany), their respective officers, employees, agents, servants and assignees, orany of them (collectively “Globalstar Indemnitees”), from any direct orindirect loss, damage, liability and expense (including reasonable attorneysfees), on account of loss or damage to tangible personal property and injuries,including death, to all persons, including but not limited to employees oragents of Ericsson, its subcontractors and the Globalstar Indemnitees, and toall other persons, arising from any occurrence to the extent caused by anynegligent act or omission or willful misconduct of Ericsson, its subcontractorsor any of them.

 

(1)   At Ericsson’s expense, Ericsson shall defendany suits or other proceedings brought against the Globalstar Indemnitees onaccount thereof, and shall pay all reasonable expenses and satisfy alljudgments which may be incurred by or rendered against them, or any of them, inconnection therewith.

 

(2)   Ericsson shall have the sole right to settleany claim or litigation against which it indemnifies hereunder.  Further, the Globalstar Indemnitees shallprovide to Ericsson such reasonable cooperation and assistance as Ericsson mayrequest to perform its obligations hereunder.

 

B.            Globalstar shall indemnify and hold harmlessEricsson, and its subsidiaries and affiliates, its subcontractors, theirrespective officers, employees, agents, servants and assignees, or any of them(collectively “Ericsson Indemnitees”), from any direct or indirect loss, damage(including damage to property and injuries,including death), liability andexpense (including reasonable attorneys fees) incurred by any third party (including employees or agents of Globalstarand Ericsson Indemnitees) andarising from any occurrence caused by any negligent act or omission or willfulmisconduct of Globalstar, its officers,employees, agents, consultants, servants and assignees.

 

(1)   In addition, Globalstar shall waive any claimagainst and shall indemnify and hold harmless Ericsson Indemnitees from anydirect or indirect loss, damage (including damage to property and injuries,including death), liability and expense incurred by any third party and arisingfrom use, operation or performance of the deliverable Products afterAcceptance, including as a result of modification or improvements made byGlobalstar.

 

(2)   Globalstar shall, at Globalstar’s expense,defend any suits brought against the Ericsson Indemnitees referred to above andshall pay all expenses and satisfy all judgments which may be incurred by orrendered against them, or any of them, in connection therewith.  Globalstar shall have the right to settle anyclaim or litigation against which it indemnifies hereunder.  Further, the Ericsson Indemnitees shallprovide to Globalstar such reasonable cooperation and assistance as Globalstarmay request to perform its obligations hereunder.

 

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C.            Ericsson shall, at its own expense, provideand maintain a Commercial General Liability Insurance Policy (“CGL Policy”)which shall cover property damage and injuries, including death, caused tothird parties.  Upon written request byGlobalstar, Ericsson will provide a Certificate of Insurance to Globalstar.

 

# **17.Globalstar-Furnished Facilities**

# ** **

Withrespect to any facilities provided by Globalstar or any of its othercontractors pursuant to Exhibit D, Statement of Work, and Exhibit E -Statement of Compliance, whether for installation of the items to be deliveredby Ericsson under this Agreement or for any other purpose, Ericsson shallexercise all reasonable care to ensure that such facilities are suitable forthe purpose intended.

 

# **18.Warranty**

# ** **

A.            Notwithstanding any prior inspection oracceptance by Globalstar, Ericsson warrants that:

 

(1) All deliverable Hardware shall be in new or like new condition when firstdelivered to Globalstar and free from any defects in materials, workmanship anddesign; and

 

(2) All deliverable Work shall conform to the requirements specified in thisAgreement, including Exhibit D, Statement of Work****and Exhibit E, Statement of Compliance**.**

 

B.            Ericsson warrants that each Product provided by Ericsson toGlobalstar hereunder will, during the applicable warranty period, performmaterially in accordance with the applicable specifications.  The warranty period is: (i) twelve (12) months for the hardwarecomponents of the Product, commencing upon delivery of the Product, (ii) three(3) months for software and firmware components of the Product (includingsubsequent releases of the software) commencing upon delivery of the softwareor firmware, or (iii) twelve (12) months for services, commencing upon thedate the Service is performed.  Ifnotified by Globalstar of any Product’s failure to perform materially inaccordance with the applicable specifications within the applicable warrantyperiod, Ericsson shall, at its election and expense, repair or replace any suchdefective Product.  Such repair orreplacement includes material, labor and services, and shall be Globalstar’ssole and exclusive remedy and Ericsson’s sole and exclusive obligation in theevent this warranty is breached.  EXCEPTAS OTHERWISE EXPRESSLY PROVIDED HEREIN, THERE ARE NO, AND ERICSSON HEREBYDISCLAIMS ALL, OTHER WARRANTIES, WHETHER IMPLIED, EXPRESS OR STATUTORY, WITHRESPECT TO THE PRODUCTS AND SERVICES PROVIDED TO CUSTOMER HEREUNDER, INCLUDINGWITHOUT LIMITATION WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE.

 

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C.  Transportation and insurance costs fordefective parts returned to Ericsson shall be at Globalstar’s charge andtransportation and insurance costs for parts replaced or repaired by Ericssonshall be at Ericsson’s charge.

 

 Inthe event an on-site intervention is needed (e.g., fault cannot be locatedremotely by Ericsson or failure of a non-replaceable unit), Ericsson shall,upon request, provide on-site support at Globalstar’s additional cost on atime-and-materials basis at the hourly labor rates set forth in Exhibit F,Expansion Pricing and Options.

 

Allreturn of defective or non-conforming Work to Ericsson shall follow Ericsson’sReturn Material Authorization (RMA) process.

 

D.            Any corrections or replacements made pursuantto this Article shall be subject to Article 9, Delivery, Title andRisk of Loss.  With respect to any partor component that is corrected or replaced, the warranty period specified inthis Article shall be suspended from the date of notification of thedefect by Globalstar and shall recommence upon the date of satisfactorycompletion of the correction or replacement for the unexpired portion of thewarranty period.  Where such correctionor replacement renders the Work or any part thereof non-functional, thewarranty period shall be similarly extended for the Work or any partthereof.  Notwithstanding the foregoing,any part or component that is corrected or replaced shall have a warrantyperiod that is the greater of three (3) months or the unexpired portion ofthe warranty period.

 

E.             Notwithstanding the foregoing, Ericsson shallnot be obligated to provide the warranty services set forth herein ifGlobalstar has not satisfied all payment obligations due and outstanding as ofthe date of any claim by Globalstar under the above warranty.  If Globalstar has due but unpaid obligations,Ericsson may, at its sole discretion and without liability to Ericsson, inaddition to demanding that Globalstar fulfills all payment obligationscontained herein:  (i) reject Worksent for repairs; or (ii) hold any Work sent for repairs until Globalstarfulfills all payment obligations contained herein.  None of the foregoing options elected byEricsson shall result in an increase in the duration of the warranty period.

 

# **19.Confidentiality**

# ** **

A.                  Eachparty shall during the term of this Agreement and for a period of five (5) yearsthereafter, keep secret and confidential all know-how or other business,technical or commercial information, in connection with this Agreementdisclosed to it by the other party or otherwise belonging to the other party(and shall ensure that any employees or subcontractors are similarly bound) andshall not disclose the same to any person save to the extent necessary toperform its obligations in accordance with the terms of this Agreement.  All such information shall be identified asconfidential at the time it is so supplied or shall be such that shouldreasonably have been understood by the receiving party (based on thecircumstances of disclosure or the nature of the information itself) 

 

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tobe proprietary and confidential to the disclosing party.  For the sake of clarity, each party shallhave the right to use, duplicate and disclose, as permitted under this Article,the other party’s confidential information as required to fulfill the party’srequirements under this Agreement, subject to the nondisclosure and userestrictions provided herein.

 

B.                  Article 14,Intellectual Property Rights, shall take precedence over the provisions of thisArticle to the extent that there is any inconsistency.

 

C.                  The foregoingprovisions of this Article shall not apply to know-how and informationwhich:

 

(1) is or becomes public knowledge without breach of this Agreement;

 

(2) is already known to the receiving party at the time of its disclosure by thedisclosing party and was not otherwise acquired by the receiving party from thedisclosing party under any obligations of confidence;

 

(3) is independently developed by Ericsson or Globalstar, which fact can be shownby competent evidence; or

 

(4) Globalstar or Ericsson is compelled by legal process or government regulationor order to disclose, provided that the disclosing party is given prompt noticeof any proposed release of information under this sub-clause and that thedisclosing party be given ample opportunity to engage in legal action to resistand/or restrict any such disclosure.

 

# **20.Limitation of Liability**

# ** **

In any event andnotwithstanding anything contained within this Agreement, Ericsson’s liabilityin contract, equity, tort (including negligence or breach of statutory duty) orotherwise arising by reason of, or in conjunction with, this Agreement (exceptin relation to death or personal injury or intellectual property rightsindemnity) shall not exceed the price or fees then already paid by Globalstarto Ericsson for the Products or Services that give rise to such liability.

 

IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANYSPECIAL, EXEMPLARY, INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES IN CONNECTIONWITH THIS AGREEMENT, HOWEVER CAUSED AND REGARDLESS OF WHETHER BASED ON ACTIONOR CLAIM IN CONTRACT, EQUITY, INDEMNITY, TORT (INCLUDING NEGLIGENCE), INTENDEDCONDUCT, STRICT LIABILITY OR OTHERWISE, EVEN IF SUCH DAMAGES ARE FORESEEABLE.

 

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# **21.Termination for Cause**

# ** **

A.            Either party shall have the right toterminate this Agreement, in whole or in part, by notice (the “TerminationNotice”) in writing to the other party in the event that:

 

(1)   the other party defaults in the performanceof any of its material obligations hereunder and (in the case of a remediablebreach) fails to make significant progress in resolving same within sixty (60)working days (the “Cure Period”) of being requested by written notice (the “DefaultNotice”) to do so; or

 

(2)   the other party becomes insolvent or thesubject of proceedings under any law relating to bankruptcy or the relief ofdebtors or admits its inability to pay its debts as they become due.

 

TheTermination Notice will be effective immediately without further period forcure.

 

Ifsuch termination for cause occurs, upon payment by Globalstar to Ericsson ofall amounts owing up to the date of the Termination Notice, Globalstar mayelect to take over the completion of the terminated Work either itself or via athird party in which case Ericsson shall be liable for any reasonable covercosts for such Work up to a maximum of [*] of the remaining unpaid amounts dueunder this Agreement.  In addition,Ericsson shall provide up to twelve (12) months of termination assistance toGlobalstar or its designee at Globalstar’s request and reasonable expense (notto exceed Ericsson’s labor rate specified in Exhibit F, Expansion Pricingand Options).

 

B.            If Globalstar issues a Termination Notice toEricsson pursuant to this Article and it is subsequently determined thatEricsson was not in breach, the rights and obligations of the parties shall bethe same as if Globalstar had terminated for convenience pursuant to Article 22,Termination for Convenience/Stop Work Orders, unless the parties mutually agreeto reinstate the Agreement.

 

# **22.Termination for Convenience/ Stop Work Orders**

# ** **

A.            Globalstar may terminate this Agreement, inwhole or in part, for Globalstar’s convenience, at any time prior tocompletion, upon thirty (30) days written notice to Ericsson.  In such case, Ericsson shall immediately stopWork as directed in the termination notice and make its reasonable best effortsto mitigate costs.

 

B.            In the event of such termination byGlobalstar, Globalstar agrees to pay termination fees as set forth in Exhibit B,Termination Liability Schedule.

 

C.            Title to items that Globalstar has takenpossession of shall transfer to Globalstar after payment.

 

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D.            Stop Work Orders

 

(1)   Globalstarmay, at any time, upon reasonable prior written notice to Ericsson (“the StopWork Order”), direct Ericsson to suspend performance of the Work for a maximumcumulative duration of six (6) months and with a maximum number ofsuspensions of two (2).  Said Stop WorkOrder shall specify the date of suspension and the estimated duration of thesuspension.  Upon receiving any such StopWork Order, Ericsson shall promptly suspend further performance of the Work tothe extent specified, and during the period of such suspension shall properlycare for and protect all Work in process and materials, supplies, and hardwareEricsson has on hand for performance of the Work.

 

(2)   Globalstarmay, at any time during the stop Work, either (a) direct Ericsson toresume performance of the Work by written notice to Ericsson, and Ericssonshall resume diligent performance of the Work, provided that (x) theDelivery Schedule is adjusted to reflect the stop Work and the time required byEricsson to recommence performance, (y) other affected provisions of theAgreement shall be adjusted, and (z) Ericsson is compensated for its Workstoppage costs as defined in Paragraph (3) below; or (b) terminatethe Agreement for convenience in accordance with the foregoing provisions ofthis Article in which case the costs incurred by Ericsson and itssubcontractors as a result of the stop Work as defined below shall be added tothe termination charges to be paid pursuant to the foregoing provisions of thisArticle.

 

(3)   The TotalPurchase Price of this Agreement shall be equitably adjusted to compensateEricsson for actual costs reasonably incurred by Ericsson or its subcontractorsas a result of such suspension and resumption of Work plus a markup of[*].  Ericsson shall invoice Globalstarfor such costs, and Globalstar shall pay such invoice within thirty (30) daysfrom the date of invoice.  Invoices willnot be issued more frequently than one (1) per month during a stop Work.If after a period of 6 months from receipt of a Stop Work Order, Globalstardoes not direct Ericsson to resume Work, Globalstar shall be deemed to haveterminated the Agreement for convenience under the foregoing provisions of thisArticle and the applicable termination charges shall apply.

 

# **23.**   Government Authorizations

# ** **

A.            Site Licenses

 

Globalstar shall be responsible for obtaining andcomplying with all national authorizations or licenses as may be required tointroduce the Product at the sites. This includes, but is not limited to,obtaining and maintaining any license, permits, and/or other authorizations ofany kind required for installation, maintenance, testing, or operation of theWork, or any portion thereof, including Services related thereto.  Globalstar shall pay 

 

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all costs of such licenses, permits and authorizationsand all costs and expenses incurred in obtaining and maintaining them.  Globalstar’s obligation to pay Ericsson shallnot in any manner be waived by delay or failure to secure or renew, or by thecancellation of, any required licenses, permits or authorizations.

 

B.            Export Control Regulations

 

(1)   It is expressly agreed that the execution ofthis Agreement and the subsequent delivery of Products and Services under thisAgreement will be subject to all applicable export controls imposed oradministered by the U. S. Government. The parties shall comply with all applicable U.S. export control lawsand regulations and with all applicable administrative acts of the U.S.Government pursuant to such laws and regulations (cumulatively, “Export Laws”).

 

(2)   Performance by Ericsson under this Agreementis subject to appropriate authorization by the U.S. Government as may berequired, including receipt and continued effectiveness of any exportprivileges/licenses.

 

(3)   For work in the U.S. involving U.S. persons(defined as U.S. citizens and U.S. lawful permanent residents), export licensesor other export authorizations will not be required.

 

(4)   Ericsson shall submit requests for commodityclassifications for the Products, including any encryption algorithms, as maybe required under the Export Administration Regulations (“EAR”) of the U.S.Department of Commerce, Bureau of Industry and Security (“BIS”).  As applicable, Ericsson shall submit requestsfor authorization to use license exceptions. Globalstar shall cooperate with Ericsson to obtain such commodityclassifications and authorizations, including providing Ericsson with anyrequired information in Globalstar’s possession.  Ericsson agrees to provide copies of suchrequests and the formal determination (including, as applicable, identificationof all Export Classification Control Numbers (“ECCNs”) and all cases of NoLicense Required (“NLR”) and License Exception) of BIS to Globalstar.  Once BIS has issued a formal determination,any use of such classifications and/or license exceptions by Globalstar shallbe without recourse to Ericsson, and shall be at Globalstar’s own risk.  Ericsson assumes no liability for any damageswhether direct, consequential, incidental, or otherwise, that may be sufferedby Globalstar as a result of Globalstar’s using or relying upon suchclassifications or license exceptions for any purpose whatsoever.

 

(5)   To the extent a U.S. export license isrequired for any deliverable Products, Ericsson will apply for the requiredU.S. export license and will export such deliverable Products in accordancewith the export license as approved by BIS.

 

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(6)   Notwithstanding any other provision of thisAgreement, Globalstar shall not use, distribute, transfer or transmit theProducts (even if incorporated into other items) provided to it by Ericssonunder this Agreement except in compliance with Export Laws.  Globalstar shall not, directly or indirectly,export or re-export the Products to any country without the appropriate exportauthorization, as specified in the Export Laws. The obligations stated herein shall survive the expiration, cancellationor termination of this Agreement or any other related agreement orcontract.  If requested by Ericsson, Globalstar also agrees to sign writtenassurances and other export-related documents as may be required for Ericssonto comply with the Export Laws.

 

# **24.  Restriction of Hazardous Substances (“ROHS”);  Waste Electrical and Electronic Equipment (“WEEE”);and Packaging and Packaging Waste**

# ** **

A**.  **DeliverableHardware shall comply with environmental standards required by Directive2002/95/EC of the European Parliament and of the Council of 27 January 2003on the restriction of the use of certain hazardous substances in electrical andelectronic equipment (the “ROHS Directive”); Directive 2002/96/EC of the European Parliament and of the Council of 27January 2003 on waste electrical and electronic equipment (the “WEEEDirective”);  and Directive 94/62/EC ofthe European Parliament and of the Council of 20 December 1994 onpackaging and packaging waste (the “Packaging Directive”), including anyamendments by Commission Decision, Joint Declaration of EU authorities andDirective 2003/108/EC of 8 December 2003 as well as any statute orstatutory provision or subordinate legislation introduced or modified from timeto time to implement such Directives into EU Member State Law.

 

B.   Ericsson shall take all reasonable steps andexercise all due diligence needed to comply with the ROHS Directive, includingwithout limitation, utilizing only ROHS-compliant subcontractors, auditing ofsubcontractors for compliance, establishing quality assurance processes andprocedures for compliance, and maintaining proper documentation ofcompliance.  At the earliest opportunitybut in any case no later than shipment of the first deliverable Hardware,Ericsson shall provide Globalstar with (a) Certificate of Compliance withthe ROHS Directive, the WEEE Directive and the Packaging Directive;  and (b) Material CompositionDeclarations from suppliers in accordance with Forms IPC-1752-1 v1.0 andIPC-1752-2 v1.0 or approved updates. Ericsson shall keep records for traceability and compliancedocumentation purposes for at least five (5) years.

 

C.   Ericssonshall take commercially reasonable steps to comply with the WEEE Directiveinformation and product marking requirements, where applicable, including asymbol of the crossed-out wheelie bin, with a horizontal bar underneathsignifying that the Hardware has been manufactured after the WEEE Directivecame into force, and a marking properly identifying Ericsson as the producer ofthe Hardware, as instructed by Globalstar.

 

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D.   Upon request, Ericsson will furnish toGlobalstar, as soon as reasonably practical but in any event within 15 businessdays of such request, any information and assistance as Globalstar, in itsreasonable opinion, requires to comply with Globalstar’s obligations under theROHS Directive, the WEEE Directive and the Packaging Directive, includingwithout limitation, the following:

 

(a)          information or evidence of compliance as may from time to time berequired by any EU Member State Government relating to the Hardware;

(b)         Hardware or component design;

(c)          marking and labeling Hardware; and

(d)         EU audit requests of Globalstar.

 

# **25.  Assignment of Agreement**

# ** **

Each party hereby agrees that it will not, withoutthe prior written approval of the other party (such approval not to beunreasonably withheld or unduly delayed), assign or delegate any of theirrights, duties, and obligations under this Agreement, except to a wholly-ownedsubsidiary of such party or except in the event of a sale of all orsubstantially all of a party’s assets (which assignment or delegation shall notrelieve the assignor or delegator of liability).  In case of assignment by Globalstar,Globalstar shall demonstrate to Ericsson’s satisfaction that its successor orassignee possesses the financial resources to fulfill Globalstar’s obligationsunder this Agreement.  Upon suchassignment, the assignee shall assume all rights and obligations of theassignor existing under this Agreement at the time of such assignment.  This Article shall not preclude thegranting of a security interest by a party to a lender.

 

# **26.  Key Personnel**

# ** **

A.            No later than KOR, Ericsson shall identifythe Key Personnel to perform the services and staff the Work, until successfulcompletion of the Work performed hereunder (individually a “Key Person” andcollectively the “Key Personnel”).

 
| **Position**                     | ** ** | **Name** |
|----------------------------------|------------|----------|
| Program Manager                  |       | [*]      |
| System Integration and  Services |       | [*]      |

 

B.            Key Personnel shall not be removed fromperformance of the Work under this Agreement unless replaced with personnel ofsubstantially equal qualifications and ability. Globalstar shall have the right to review the qualifications of any proposedreplacements.  If Globalstar deems, inits reasonable judgment, the proposed replacements to be unsuitable, Globalstarmay require Ericsson to offer alternative candidates.  Notwithstanding its role in reviewing KeyPersonnel and their replacements, Globalstar shall have no supervisory controlover their performance and nothing in this Article shall 

 

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relieveEricsson of any of its obligations under this Agreement or of itsresponsibility for any acts or omissions of its personnel.

 

# **27.  Communication and Authority**

# ** **

A.            [*] is assigned as Globalstar’s ProgramManager with authority to issue technical direction within the scope of thisAgreement.  [*] is assigned as Ericsson’sProgram Manager with authority to accept such direction.  Notwithstanding Article 26(A), KeyPersonnel, the foregoing Program Managers are authorized (i) to initialthe Exhibits and any modifications thereto (except Exhibit A - PricingSchedule and Exhibit F - Expansion Pricing and Options), and (ii) toexecute the waivers of technical compliance with the specifications in theExhibits.

 

B.            All contractual correspondence to Globalstarwill be addressed to (with copy to the Program Manager):

 

[*]

 

Alltechnical correspondence to Globalstar will be addressed to:

 

[*]

 

All notices to Ericsson required to be sent pursuant to Article 15,Intellectual property Rights Indemnification, Article 19, Confidentiality,Article 21, Termination for Cause and Article 22, Termination forConvenience/ Stop Work Orders, shall be addressed to:

 

[*]

 

Allother contractual correspondence to Ericsson will be addressed to (with copy tothe Program Manager):

 

[*]

 

Allprogram and technical correspondence to Ericsson will be addressed to theProgram Manager.

 

C.            In a time critical situation, such asoperational or technical matters requiring immediate attention, notice may begiven by telephone.  Any notice givenverbally will be confirmed in writing as soon as practicable thereafter inaccordance with Paragraph D of this Article.

 

D.            Except as provided in Paragraph C of thisArticle, all notices, demands, reports, orders and requests hereunder by oneparty to the other shall be in writing and deemed to be duly given on the samebusiness day if sent by electronic means (i.e., electronic mail) or 

 

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deliveredby hand during the receiving party’s regular business hours, or on the date ofactual receipt if sent by pre-paid overnight, registered or certified mail.

 

E.             The parties agree to cooperate in implementingthe use of electronic signatures, provided that such use is consistent withapplicable law.

 

# **28.Dispute Resolution**

# ** **

Theparties shall attempt to resolve any dispute, controversy or difference thatmay arise between them through good faith negotiations.  In the event the parties fail to reachresolution of such dispute within thirty (30) days of entering intonegotiations, either party may refer such dispute to arbitration as set forthbelow.

 

Anydisputes arising under or relating to this Agreement shall be resolved inaccordance with the Commercial Arbitration Rules of the AmericanArbitration Association.  Arbitrationshall be held in the City of Denver, Colorado, or such other place as theparties may agree and shall include an award of attorneys’ fees (and the amountof such fees) to the prevailing party. The arbitration shall be conducted by one arbitrator whose selectionshall be based upon mutual agreement of the Parties.  The arbitrator’s award shall be final andbinding, and judgment thereon may be entered in any court having jurisdictionover the party against which enforcement is sought; provided that any suchaward rendered by the arbitrators shall be strictly in conformance to and inaccordance with the terms and conditions of this Agreement, including withoutlimitation the limitation of liability provisions contained herein.  Other than those matters involving injunctiverelief as a remedy or any action necessary to enforce the award of the arbitrators,the parties agree that the provisions of this Section are a completedefense to any suit, action or other proceedings instituted in any court orbefore any administrative tribunal with respect to any dispute or controversyarising under or relating to this Agreement. Nothing in this Section shall prevent either party from exercisingits rights to terminate this Agreement as specified herein.  The provisions of this Section shallsurvive the expiration or termination of this Agreement for any reason.

 

# **29.Changes**

# ** **

A.            At any time during this Agreement, Globalstarmay request changes in the Work, so long as such changes are within the generalscope of the Agreement.  Ericsson mayalso propose changes for consideration by Globalstar.

 

B.            A change request from Globalstar must beidentified as such, must be made or confirmed in writing, and must be signed bythe responsible officer identified in Article 27, Communication andAuthority.  If any other conduct by theresponsible officer or any other representative of Globalstar is construed byEricsson as possibly constituting a change request or an interpretation of theAgreement requirements inconsistent with Ericsson’s understanding of thoserequirements, Ericsson shall promptly notify Globalstar and requestclarification.

 

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C.            Within thirty (30) days after receiving achange request from Globalstar, Ericsson shall submit to Globalstar a writtenproposal in accordance with the requirements of Paragraph D of thisArticle.  On a case-by-case basis,Ericsson may request a longer period to prepare the proposal.  Globalstar shall not unreasonably withholdits consent to a request for such a longer period, taking into account thenature of the change request, but Globalstar may also take into account theimpact of such an extension on the performance schedule.

 

D.            Whether submitted in response to a changerequest initiated by Globalstar, or initiated by Ericsson, the proposal shallitemize, in a reasonable format specified by Globalstar, any impact that thechange would have on the technical requirements, price, performance schedule,or other terms and conditions of this Agreement.  Where appropriate, the proposal shall alsosuggest any revised language for the Agreement, including any of its Exhibits,which would be necessary to implement the change.

 

E.             Any claim by Ericsson for adjustment of thetechnical requirements, price, performance schedule, or other terms andconditions of this Agreement, attributable to a change, shall be deemed waivedunless asserted in the proposal.

 

F.             If the cost of any materials that would bemade obsolete as a result of a change is included in Ericsson’s claim foradjustment:

 

(1) To the extent that such materials haveresale, reuse, or salvage value to Ericsson or its subcontractors or suppliers,Globalstar shall be entitled to a credit.

 

(2) If such materials have no such resale,reuse, or salvage value, Globalstar shall have the right to prescribe theirmanner of disposition.

 

G.            After Globalstar receives a sufficiently detailedproposal, and after any negotiations with respect to the adjustments claimed byEricsson, the following outcomes are possible:

 

(1) Globalstar may decide not to proceed withimplementation of the change.

 

(2) Globalstar may decide to implement the change,in which case:

 

(a)          Ifthe parties have reached agreement about the adjustments to be made in theAgreement, the parties shall execute a formal amendment to the Agreement andEricsson shall proceed with implementation as agreed; or

 

(b)         Globalstar and Ericsson may agree to proceedwith implementation of a change prior to execution of a formal amendment,subject to any adjustments subsequently agreed or awarded.

 

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# **30. PublicRelease of Information**

# ** **

Eachparty agrees to submit to the other party all press releases and otherpublicity matters wherein the other party’s names or marks are mentioned orlanguage from which the connection of said names or marks therewith may beinferred or implied. Each party agrees not to publish such press releases orpublicity matters without the other party’s prior written approval.

 

A.            During the term of this Agreement, neitherparty, nor its affiliates, subcontractors, employees, agents and consultants,shall release items of publicity of any kind including, without limitation,news releases, articles, brochures, advertisements, prepared speeches, companyreports or other information releases related to the Work performed hereunder,including the denial or confirmation thereof, without the other party’s priorwritten consent.

 

B.            Nothing contained herein shall be deemed toprohibit either party from disclosing this Agreement, in whole or in part, orinformation relating thereto (i) as may be required by the rules andregulations of a government agency with jurisdiction over the disclosing partyor a stock exchange on which the disclosing party’s shares are then listed, (ii) asmay be required by a subpoena or other legal process (iii) in any actionto enforce its rights under this Agreement, (iv) to its lenders underappropriate assurances of confidentiality for the benefit of the disclosingparty or (v) to its auditors, attorneys and other professional advisors inthe ordinary course, provided that such auditors, attorney and advisors havecontractual or professional obligations to maintain the confidentiality of thedisclosed material.  The disclosing partyshall use reasonable commercial efforts to disclose only such information as itbelieves in good faith it is legally required to disclose pursuant to clauses (i) or(ii), above, and will seek, to the extent reasonably available under applicablerules, to obtain confidential treatment for any information either partyreasonably considers trade secrets and that is required to be disclosed.  To the extent practicable, the disclosingparty shall provide the other party with a reasonable opportunity in advance ofdisclosure to request redactions or deletions of specific terms and provisionsof the Agreement and shall accommodate those requests to the extent reasonablyconsistent with applicable confidential treatment rules.

 

C.            Within a reasonable time prior to a proposedissuance of news releases, articles, brochures, advertisements, preparedspeeches, and other such information releases concerning the Work performedhereunder, the party desiring to release such information shall request thewritten approval of the other party concerning the content and timing of suchreleases.  The parties anticipate theissuance of press releases in connection with the execution of the Agreement,which press releases shall be subject to approval by both parties prior torelease.

 

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# **31. ForceMajeure**

# ** **

Each party will be excused from performance hereunder (except for paymentobligation) for any period and to the extent that it is prevented from suchperformance, in whole or in part, as a result of delays caused by the otherparty or an act of God, natural disaster, war, civil disturbance, court order,labor dispute, or other cause beyond its reasonable control and which it couldnot have prevented by reasonable precautions, including failures orfluctuations in electrical power, heat, light, air conditioning ortelecommunications equipment, and such non-performance will not be a defaulthereunder or a ground for termination hereof.

 

# **32.Relationship**

# ** **

Therelationship between Globalstar and Ericsson is that of independentcontractor.  This Agreement does notcreate any employer-employee, agency, joint venture, or partnershiprelationship between Globalstar and Ericsson.

 

# **33.Miscellaneous**

# ** **

ThisAgreement shall be governed by the laws of the State of Colorado, other thanthe choice of law rules. The provisions of this Agreement shall be severable,and if any provisions shall be held unenforceable the remaining provisionsshall remain in full force and effect. Expiration or termination of this Agreement for any reason shall notrelease either party from any liability or obligation set forth in this Agreementwhich (i) the parties have expressly agreed will survive any suchexpiration or termination, or (ii) remain to be performed or by theirnature would be intended to be applicable following such expiration ortermination.  This Agreement, eachStatement of Work (or purchase order submitted by Globalstar and accepted byEricsson), and all Exhibits attached hereto or thereto, each of which is herebyincorporated herein or therein, as applicable, for all purposes, constitute theentire agreement between Ericsson and Globalstar with respect to the subjectmatter hereof and thereof, and there are no understandings or agreementsrelative hereto or thereto that are not fully expressed herein or therein. Anyother terms or conditions included in any quotes, acknowledgements, bills oflading, purchase orders, invoices or other forms utilized or exchanged by theparties hereto that are in addition to or in conflict with those set forth inthis Agreement or the applicable Statement of Work will be of no force or effectand will not be incorporated herein or be binding unless specifically andexpressly agreed to in writing by both parties. No change, waiver or discharge will be valid unless in writing signed byan authorized representative of the party against whom such change, waiver ordischarge is sought to be enforced.

 

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INWITNESS WHEREOF, the parties to this Agreement have caused their authorizedrepresentatives to execute this Agreement as of the Effective Date.

 

 
| **ERICSSON FEDERAL INC.** |                         |   |
|---------------------------|------------------------------|--------|
|                      |                         |   |
| By:                       | /s/  Douglas C. Smith        |   |   |
|                      |                         |   |
| Printed  Name:            | Douglas  C. Smith            |   |   |
|                      |                         |   |
| Title:                    | President,  Ericsson Federal |   |   |
|                      |                         |   |
| ** **                |                         |   |
| **GLOBALSTAR, INC.**      |                         |   |
|                      |                         |   |
| By:                       | /s/  Thomas M. Colby         |   |   |
|                      |                         |   |
| Printed  Name:            | Thomas  M. Colby             |   |   |
|                      |                         |   |
| Title:                    | Chief  Operating Officer     |   |   |
|                           |                              |        |  |  |  |  |

 

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