PARIS — Globalstar has made the first of two $7-million cash payments to contractor MDA Ltd. and agreed to pay a 7% annual interest on the outstanding amount due on its $327 million contract for 17 satellites Globalstar ordered for its Apple service contract.

The first payment, which MDA confirmed during a Nov. 11 investor call, was made Oct. 31. A second $7-million payment is due in November.

Globalstar has been working on a debt-financing package to pay the balance due on the MDA contract in December. MDA Chief Financial Officer Vito Culmone said MDA is confident that Globalstar will meet its end-year date for the next payment.

MDA is building 17 Globalstar satellites, with options for nine more, as part of the Globalstar upgrade made necessary by the Globalstar service-level agreement with Apple.

Apple has agreed to reimburse Globalstar 95% of the approved costs involved in building 10 new gateway Earth stations and the launch of a spare satellite. The launch has already occurred. Cobham Satcom of California is providing new antennas for the Globalstar Earth station sites.

The Apple Advanced Manufacturing Fund announced Nov. 10 that it was investing $450 million, most of it going to Globalstar, to improve the Emergency SOS service that is scheduled to begin in the coming weeks in the United States.

Globalstar has said it did not expect its reimbursement from Apple until 2025, when the satellites are scheduled to begin launching. Its agreement with MDA was for vendor financing by MDA, at zero interest rate, through August. That was extended.

The new satellites, to be launched in 2025, will mean Emergency SOS users do not have to wait as long to find a connection to a Globalstar satellite.

It remains unclear how many nations outside the United States will allow the Emergency SOS service, which involves a direct link between a Globalstar satellite in low Earth orbit and an Apple 14 smartphone that must be taken outside and oriented toward the sky to make the link.

The service presumably will be offered to Apple customers even in nations where Globalstar ground stations are not installed. The service does not include any involvement by terrestrial mobile network operators.

Some nations have already refused to allow Apple 14 phones sold in their territories equipped with the L- and S-band Emergency SOS feature out of concern that it’s the thin end of a wedge that leads to additional features that will be beyond their power to monitor.

In addition to the Globalstar contract, Canada-based MDA booked orders for steerable Ka-band antennas for relatively small satellites to be built by York Space Systems and Airbus OneWeb Satellites, through Airbus U.S. Space & Defence Inc., in two separate contracts.

The U.S. Space Development Agency (SDA) on Oct. 6 announced an award of up to $200 million to York for 12 satellites with experimental military communications payloads in UHF- and S-band.

Airbus OneWeb Satellites, based in Florida, is completing construction of the 648-satellite OneWeb Gen 1 constellation and has already begun to take on work for other satellite operators.

Airbus OneWeb has booked an order from Northrop Grumman for 42 ARROW platforms, derived from the OneWeb product, that will be fitted with Northrop payloads under contract to the SDA.

The Globalstar, Airbus and York contracts helped swell MDA’s backlog to 1.4 billion Canadian dollars ($1.02 billion) as of Sept. 30, more than double the company’s expected 2022 revenue of 646 million Canadian dollars at the midpoint of the company’s forecast.

That is a 30% revenue increase from 2021. The backlog figure is a 70% increase from a year ago.

It is orders like these that have bolstered MDA’s confidence that despite headwinds from higher interest rates and the liquidity stresses on some New Space companies, the market remains strong for LEO constellations. MDA is expanding its Montreal-based production facility as a result.

MDA hired 670 new full-time employees in 2021 and as of Sept. 30 had hired another 700 people.

Waiting for, but not really expecting, a Lightspeed contract

Canada-based Telesat on Nov. 8 said it was still negotiating with the French and Canadian export-credit agencies and other sources of potential financing for its $5-billion Lightspeed broadband constellation in low Earth orbit.

Telesat insisted it was still optimistic that Lightspeed would move forward and that an agreement on financing could be reached by the end of this year.

MDA initially expected a contract valued at around 800 million Canadian dollars to build Lightspeed satellite antennas and other hardware. As Lightspeed dragged on without a final contract signature, MDA removed the contract from its projected revenue for 2022.

MDA Chief Executive Mike Greenley said MDA continues to “work it [Lightspeed] as an opportunity in our pipeline. Lightspeed continues to advance efforts to arrange financing and we will continue to watch that. I’d say, we’ve been here before.”

Greenley said all the Lightspeed contractors, a team to be led by prime contractor Thales Alenia Space of France and Italy, have been updating their bids and quoted prices to Telesat. In the event financing is secured, Telesat will be able to conclude contracts relatively quickly.

Greenley did not provide details on MDA’s updated contract quotes and how far they differ from the original package.

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