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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
April 2, 1998
GLOBALSTAR TELECOMMUNICATIONS LIMITED
(Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
<S> <C> <C>
Islands of Bermuda 0-25456 13-3795510
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) Number
</TABLE>
Cedar House, 41 Cedar Avenue, Hamilton, Bermuda HM 12
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(441) 295-2244
GLOBALSTAR, L.P.
(Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
<S> <C> <C>
Delaware 333-25461 13-3759824
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) Number
</TABLE>
3200 Zanker Road, San Jose, California 95134
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(408) 933-4000
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Item 5. Other Events.
On April 27, 1998, the Board of Directors of Globalstar
Telecommunications Limited ("GTL"), general partner of Globalstar, L.P.
("Globalstar"), approved the issuance, pending shareholder approval of a
proposal to increase the number of GTL shares of common stock authorized for
issuance from 200 million to 600 million and a proposal to amend the bye-laws of
GTL to authorize the GTL Board of Directors to make stock distributions, of a
stock dividend to shareholders consisting of one share of common stock for each
outstanding share. At GTL's annual meeting held on April 28, 1998, shareholders
approved this proposal. The stock dividend will be paid on June 8, 1998 to
shareholders of record as of May 29, 1998.
On April 24, 1998, Globalstar launched its second group of
four satellites.
On April 21, 1998, Globalstar announced that China Telecom
(Hong Kong) Group Ltd. ("China Telecom") had exercised, effective April 8, 1998,
its option to acquire 937,500 Globalstar ordinary partnership interests for a
purchase price of $18,750,000. In addition, China Telecom has the right to
acquire an additional 937,500 Globalstar ordinary partnership interests for
$18,750,000 upon reaching certain target revenue levels. Globalstar had
previously granted these options to China Telecom in connection with service
provider arrangements in China under which China Telecommunications Broadcast
Satellite Corporation ("ChinaSat") will act as the sole distributor of
Globalstar services in China.
On April 3, 1998, Globalstar and Globalstar service providers
entered into contracts with Qualcomm Incorporated, L.M. Ericsson and Telital
S.r.L. totaling $353 million for the initial manufacture and delivery of more
than 300,000 production handheld and fixed user terminals.
On April 2, 1998, GTL announced that it called for the
redemption on April 30, 1998 of all of its $310,000,000 aggregate principal
amount outstanding 6-1/2% convertible preferred equivalent obligations due 2006
(the "CPEOs"). Prior to the redemption date, holders of $310,000,000 aggregate
principal amount of CPEOs converted their CPEOs into 10,061,430 shares of GTL
common stock at a conversion price of $30.81 per share. In addition, GTL is
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issuing 269,660 shares of common stock in the aggregate ($.0435 per CPEO) as an
interest make-whole payment to converting holders (representing an
interest make-whole payment of $2.68 per CPEO).
As of April 1998, Globalstar's budgeted expenditures for the
design, construction and deployment of the Globalstar System, including working
capital, cash interest on borrowings and operating expenses increased from
approximately $2.7 billion to approximately $2.8 billion, reflecting revised
cost estimates from Qualcomm and other increased Globalstar expenditures. In
addition to expenditures for operating costs, working capital and debt service,
Globalstar anticipates additional expenditures on system software following the
commencement of commercial service for the improvement of system functionality
and the addition of new features in response to future marketplace demands. As
of March 31, 1998, Globalstar had raised or received commitments for
approximately $2.6 billion.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
GLOBALSTAR TELECOMMUNICATIONS
LIMITED
(Registrant)
Date: May 5, 1998 By: /s/ Eric J. Zahler
-------------------
Eric J. Zahler
Vice President
GLOBALSTAR, L.P.
----------------
(Registrant)
By: Loral/QUALCOMM Satellite
Services, L.P.,
its General Partner
By: Loral/QUALCOMM
Partnership, L.P.,
its General Partner
By: Loral General Partner, Inc.
its General Partner
Date: May 5, 1998 By: /s/ Eric J. Zahler
-------------------
Eric J. Zahler
Vice President
