Globalstar, Inc. Common StockGSAT

Credit and liquidity · Credit risk and customer defaults

We are exposed to trade credit risk in the ordinary course of our business activities. We are exposed to risk of loss in the event of nonperformance by our customers of their obligations to us. Our Commercial IoT business is heavily concentrated in the oil and gas industry and was negatively impacted by the downturn in this industry.

International and currency · Foreign exchange and currency exposure

Our operations involve transactions in a variety of currencies. Sales denominated in foreign currencies involve primarily the Canadian dollar, the euro and the Brazilian real. Accordingly, our operating results may be significantly affected by fluctuations in the exchange rates for these currencies.

Credit and liquidity · Debt service and covenant compliance

Restrictive covenants in our debt agreements may limit our operating and financial flexibility and our inability to comply with these covenants could have significant implications. Our First Lien Facility Agreement and Second Lien Facility Agreement contain a number of significant restrictions and covenants.

International and currency · International operations and emerging markets

Our operations are subject to certain regulations of the United States State Department's Directorate of Defense Trade Controls, United States Treasury Department's Office of Foreign Assets Control and the United States Commerce Department's Bureau of Industry and Security. These U.S. and foreign obligations and regulations may limit or delay our ability to offer products and services in a particular country.

Market and investment · Interest rate and yield curve risk

In July 2017, the Financial Conduct Authority in the United Kingdom announced that the Libor rate would be phased out and financial institutions would no longer need to make Libor submissions after 2021. At this time, we cannot provide assurance of the impact this Libor phase out will have on our financial statements and internal processes.

International and currency · Emerging markets exposure

We face special risks by doing business in international markets and developing markets, including currency and expropriation risks, which could increase our costs or reduce our revenues in these areas. Developing countries are more likely than industrialized countries to experience market, currency and interest rate fluctuations and high inflation.

Innovation and product development · Intellectual property protection and infringement

If we do not develop, acquire and maintain proprietary information and intellectual property rights, it could limit the growth of our business and reduce our market share. Our proprietary information may be disclosed to others, or others may independently develop similar information, systems and know-how.

Market position and competition · Competitive pressure and market share loss

We face intense competition in all of our markets, which could result in a loss of customers, lower revenues and difficulty entering new markets. There are currently at least four other MSS operators providing services similar to ours on a global or regional basis: Iridium, Thuraya, Inmarsat and ORBCOMM Inc.

Information management · Technology vendor dependence

We license much of the software we require to support critical gateway operations from third parties. If the third-party licensors cease to support and service our software, or our licenses are no longer available on commercially reasonable terms, it might be difficult, expensive or impossible for us to obtain such services from alternative vendors.

Technology infrastructure · Legacy systems and technical debt

The hardware and software we utilize in operating our first-generation gateways were designed and manufactured over 20 years ago and portions have deteriorated. This original equipment may become less reliable as it ages and will be more difficult and expensive to service.

Technology infrastructure · Network connectivity and telecommunications

Our satellites may experience temporary outages or otherwise may not be fully functioning at any given time. In-orbit failure may result from various causes, including component failure, solar array failures, telemetry transmitter failures, loss of power or fuel, inability to control positioning of the satellite, solar or other astronomical events, including solar radiation and flares, and collision with space debris or other satellites.

Cybersecurity and data protection · Third party data security and vendors

Our network and those of our third-party service providers and our customers may be vulnerable to unauthorized access, attacks, malware, data breaches and other security problems. A data breach or network disruption could harm our reputation, cause demand for our products and services to fall or compromise our ability to pursue our business plans.

Supply chain and procurement · Supplier operation and dependance

We source our products from both domestic and foreign contract manufacturers, with the largest concentration in China. Policies were put in place in China to reduce the transmission of COVID-19, which may impact the availability of labor at our manufacturing facility as well as the interruption of components and products moving through our supply chain.

Industry regulation · Safety and environmental regulations

Wireless devices' radio frequency emissions are the subject of regulation and litigation concerning their environmental effects, which includes alleged health and safety risks. Lawsuits have been filed against participants in the wireless communications industry alleging a number of adverse health consequences, including cancer, as a result of wireless phone usage.

Legal and litigation · Product liability and warranty claims

We are subject to product liability and product recall claims if any of our products and services are alleged to have caused injury to persons or damage to property. Because consumers may use SPOT products and services in isolated or dangerous locations, users of our devices who suffer injury or death may seek to assert claims against us.

Data and privacy · Data protection and privacy laws

We collect and store data, including our customers' personal information. In jurisdictions around the world, personal information is increasingly becoming the subject of extensive legislation and regulations to protect consumers' privacy and security, including the EU's General Data Protection Regulation that became effective in 2018.

Data and privacy · Regulatory investigations and penalties

We have been in the past from time to time, and may be in the future, subject to litigation and investigations that could have a substantial, adverse impact on our business. We have also been in the past, and may be in the future, subject to investigations by regulators and governmental agencies.

Tax and financial reporting · Tax compliance and changes in tax law

We operate in many tax jurisdictions, and changes in tax rates or adverse results of tax examinations could materially increase our costs. Our tax obligations are subject to review and possible challenge by the taxing authorities of these jurisdictions.

Stakeholder relations · Investor relations and market confidence

Our common stock is traded on the NYSE American but could be delisted in the future, which may impair our ability to raise capital. Broker-dealers may be less willing or able to sell and/or make a market in our common stock if it were delisted.

Natural and catastrophic events · Natural disasters and extreme weather

A natural disaster could diminish our ability to provide communications service. Natural disasters could damage or destroy our ground stations and disrupt service to our customers. If a natural disaster were to impair, damage or destroy any of our ground facilities, we may be rendered unable to provide service to our customers.