Globalstar, Inc. (Nasdaq:GSAT), Milpitas, Calif., a provider of
mobile satellite voice and data services to businesses, governments, and
individuals, has announced that Open Range Communications, Inc. has
secured approval for a $267 million broadband loan from the Department
of Agriculture's Rural Utilities Program.
In late 2007 Globalstar signed an agreement with Open Range
permitting Open Range to deploy wireless broadband service in rural
America using Globalstar's Ancillary Terrestrial Component (ATC)
authority. The agreement contemplates using the Globalstar spectrum to
offer dual mode mobile satellite based and terrestrial wireless WiMAX
services to over 500 rural American communities that currently do not
have adequate access to terrestrial-based broadband voice and data
services. Customers outside of the WiMAX coverage area will be able to
use Globalstar service over the satellites. The agreement is contingent
on various conditions, including Globalstar's receipt of authority
from the FCC to use an expanded portion of its licensed spectrum for ATC
services.
"Globalstar is extremely excited because this financing
approval moves Open Range a step closer to meeting the wireless
broadband needs of un-served and underserved rural Americans using our
ATC authorized spectrum," said Jay Monroe, Chairman and CEO of
Globalstar, Inc. Monroe added, "We expect the ATC agreement with
Open Range to open the door for rural consumers to make new, dependable,
and low-cost choices that will help provide ultimate flexibility in
their daily lives. We believe this agreement establishes a framework for
how global spectrum may be used more efficiently to the benefit of
Globalstar, our partners and our customers."
Open Range expects initially to deploy its infrastructure in more
than 500 rural communities which cover over 6 million people. The
business plan calls for coverage to be deployed in rural communities
with average populations of approximately 10,000 people and for
availability to begin in selected markets in 2008.
The term of the agreement is 30 years, is co-extensive with
Globalstar's ATC authority and is subject to renewal options
exercisable by Open Range. Using the build out schedule provided in its
application for the federally authorized loan program, the fixed and
variable payments to be made to Globalstar over the 30 year term
indicate a present value of between 30 and 40 cents per MHz/Pop. The
total amount of the payments made to Globalstar will depend on a number
of factors, including the eventual geographic coverage of, and the
number of customers on the Open Range system.
The USDA Rural Development's mission is to increase economic
opportunity and improve the quality of life for rural residents. Rural
Development has invested nearly $91 billion since 2001 for equity and
technical assistance to finance and foster growth in homeownership,
business development, and critical community and technology
infrastructure. More than 1.7 million jobs have been created or saved
through these investments.
About Globalstar, Inc.
Globalstar offers satellite voice and data services to commercial
and recreational users in more than 120 countries around the world. The
company's products include mobile and fixed satellite telephones,
simplex and duplex satellite data modems and flexible service packages.
Many land based and maritime industries benefit from Globalstar with
increased productivity from remote areas beyond cellular and landline
service. Global customer segments include: oil and gas, government,
mining, forestry, commercial fishing, utilities, military,
transportation, heavy construction, emergency preparedness, and business
continuity as well as individual recreational users. Globalstar data
solutions are ideal for various asset and personal tracking, data
monitoring and SCADA applications.
For more information, visit http://www.globalstar.com or call
408/933-4006.
About Open Range
Open Range is a broadband wireless Internet access provider
building a national network providing simply easier wireless broadband
to un-served and underserved rural American communities. Open Range
plans to deliver voice and data services on a portable and eventually
mobile basis to customers within its WiMAX footprint. Within the next
five years, Open Range intends to serve over 500 communities, making its
services available to approximately six million people. Open
Range's wireless broadband network solution will connect customers
through licensed or secured spectrum, enabling communities to improve
safety, economic growth, education, and quality of life and remain
competitive in the age of constant communications.
For more information, visit http://www.openrangecomm.com.
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