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FOR IMMEDIATE RELEASE
ORBCOMM REVISES BUSINESS APPROACH
STAFF REDUCTION IMPLEMENTED, ADDITIONAL INTERIM FINANCING PROVIDED
Dulles, VA, August 4, 2000 - ORBCOMM Global, L.P. (ORBCOMM) today announced
that, after several months of review and assessment, it has adopted a revised
sales and marketing strategy for its low-Earth orbit satellite data
communication system in light of lower than expected subscriber ramp-up and
revenues. Under this new strategy, the company will focus on its top-tier
customers in a number of key industries and distribute its services through
value-added resellers and other partners, rather than through both direct and
indirect sales channels. In connection with the implementation of this new
strategy, ORBCOMM has reduced its US-based staff by approximately 100 employees.
In addition, ORBCOMM announced that its current partners have agreed on limited
interim debt financing that is expected to provide the company with $17 million
in additional cash from an affiliate of Teleglobe, which financing will support
near-term operations. Teleglobe will immediately provide a portion of the
financing in the form of a secured loan and will provide the remainder in a form
determined by Teleglobe. Due to the limited amount of funds available to
ORBCOMM, it is highly unlikely that the company will make the interest payment
scheduled to be paid on August 15, 2000 on its outstanding senior notes.
ORBCOMM is continuing to seek additional third party equity investors to join
ORBCOMM's existing partners. In addition, ORBCOMM is exploring a variety of
financing alternatives, including selling various assets and restructuring or
reorganizing its outstanding debt and/or its business.
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"ORBCOMM believes that the actions announced today will allow it to better focus
its resources on providing productivity-enhancing data communication services to
its major customers worldwide," said Scott L. Webster, Chairman and Chief
Executive Officer of ORBCOMM. "Over the past several years, we have developed
equipment and software applications for certain key markets and will make these
technologies available to our distribution partners. ORBCOMM believes that the
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reduction in force, while unfortunate, will not divert ORBCOMM from maintaining
and operating the ORBCOMM satellite constellation."
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This release contains forward-looking statements, including statements regarding
ORBCOMM's expected commercial operations. These forward-looking statements are
based on a number of assumptions and ORBCOMM's actual results and operations may
be materially different from those expressed or implied by such statements. For
a description of factors that may cause ORBCOMM's results to differ materially
from those expressed or implied by such forward-looking statements, please
consult the Securities and Exchange Act filings of ORBCOMM Global, L.P.
FOR MORE EDITORIAL INFORMATION, PLEASE CONTACT:
ORBCOMM
Michelle Ferris
(703) 433-6991
[email protected]
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